Tax Liability Analyzer

Calculator Core Concepts Tax Rates NIIT Explained Strategies

Interactive Tax Calculator (2024)

This section brings the tax calculation process to life. The form below is pre-filled with the case study from the report. Change any value to instantly see how it affects the entire tax liability calculation, from Gross Income to the final amount due. Use the info icons ? for a quick explanation of each term.

Your Financial Profile

Filing Status Married Filing Jointly Single Head of Household Married Filing Separately

Total Wages

Qualified Dividends

Long-Term Capital Gains

Above-the-Line Deductions

Deduction Method Standard Deduction Itemized Deductions

Tax Liability Breakdown

Gross Income ?

All income from whatever source derived, including wages, dividends, and gains. Tax-exempt interest is excluded.

-

Adjusted Gross Income (AGI) ?

Gross Income minus "above-the-line" deductions like 401(k) contributions and student loan interest. AGI is a key figure that determines eligibility for many tax benefits.

-

Taxable Income ?

AGI minus the greater of the Standard Deduction or Itemized Deductions. This is the final income amount upon which tax is calculated.

---

Regular Income Tax

Net Investment Income Tax

Total Federal Tax Liability

Total Tax Composition

Core Concepts

Understanding your tax calculation requires knowing the key terms. Click on any concept below to learn more about its role in the U.S. tax system. This section breaks down the foundational building blocks of your tax return.

Tax Rates & Brackets

The U.S. has a progressive tax system, meaning higher income is taxed at higher rates. Use the controls below to visualize the tax brackets for different years and filing statuses. Hover over a bracket in the chart to see the specific income range and tax rate. This demonstrates how only a portion of your income falls into each bracket.

Tax Year: 2024 2025

Filing Status: Single Married Filing Jointly Head of Household Married Filing Separately

The 3.8% Net Investment Income Tax (NIIT)

The NIIT is an additional surtax on investment income for higher-income individuals. Liability depends on a two-part test. The flowchart below explains this test, and the mini-calculator demonstrates the crucial "lesser of" rule used in the final calculation.

NIIT Liability Flowchart

Step 1: MAGI Test

Is your Modified Adjusted Gross Income (MAGI) over the threshold for your filing status?

• $250,000 for MFJ
• $200,000 for Single / HOH
• $125,000 for MFS

AND

Step 2: NII Test

Do you have Net Investment Income (NII)? This includes interest, dividends, capital gains, rental income, etc.

⬇

If YES to both...

You are subject to the NIIT. The tax is 3.8% of the lesser of your NII or the amount your MAGI exceeds the threshold.

"Lesser Of" Rule Calculator

Your MAGI

Your Net Investment Income (NII)

NIIT Owed

Tax Mitigation Strategies

Proactive planning can help reduce your overall tax liability, especially the NIIT. Strategies generally focus on reducing your MAGI or your NII. Explore the common techniques below to learn more about advanced tax planning.