Calculate Your — Income Tax

: Up to $2,500 in interest paid on qualified loans.

: Payments to a Traditional IRA or 401(k).

Calculating your income tax involves a multi-step process that transforms your total earnings into a final amount owed or a refund. For the 2026 tax year, recent legislation like the One, Big, Beautiful Bill (OBBB) has permanently set tax rates while adjusting brackets and deductions for inflation. 🏗️ Step 1: Calculate Your Gross Income calculate your income tax

: Rental income, gambling winnings, and distributions from retirement accounts. 📉 Step 2: Determine Your Adjusted Gross Income (AGI)

Start by adding up every dollar you earned throughout the year. This is your "raw" income before any reductions. : Up to $2,500 in interest paid on qualified loans

You must decide between taking a fixed "standard" deduction or listing specific "itemized" expenses. Choose whichever is higher to lower your taxable income the most. Filing Status Deduction Amount Single / Married Filing Separately Married Filing Jointly Head of Household

: If you are 65+, you can claim an additional "bonus" deduction of up to $6,000 (single) or $12,000 (joint) depending on your income. Common Itemized Deductions For the 2026 tax year, recent legislation like

: State and local taxes, now capped at $40,400 for most filers. Mortgage Interest : Interest on up to $750,000 of home debt.