(WETM) – Tax season is upon us, and if you’re filing yourself, it’s time to get all those documents together to crunch the numbers. With so many boxes to check and numbers to enter, it can be hard to keep track of just how much money is changing hands.

Things are made all the more confusing when it comes to tax brackets. Depending on how much income you make, you’ll be taxed different amounts. If you make a higher income, you’re taxed at a higher rate because you fall into a higher tax bracket.

However, just because you’re in a higher tax bracket, not all of your income is getting taxed at that amount.

NerdWallet has a breakdown of income tax rates for both 2023 filings and 2024 filings. The brackets work by only taxing the amount of income that falls within that range.

Here is the breakdown for single filers’ tax brackets for your 2022 income. This is your income that will be filed this current season (due April 18, 2023):

Tax RateIncome BracketTax Owed
10%$0-$10,27510% of taxable income
12%$10,276-$41,775$1,027.50 plus 12% of the amount over $10,275
22%$41,776-$89,075$4,807.50 plus 22% of the amount over $41,775
24%$89,076-$170,050$15,213.50 plus 24% of the amount over $89,075
32%$170,051-$215,950$34,647.50 plus 32% of the amount over $170,050
35%$215,951-$539,900$49,335.50 plus 35% of the amount over $215,950
37%$539,901 or more$162,718 plus 37% of the amount over $539,900
Source: IRS and NerdWallet

Crunching the numbers

Let’s put these numbers into perspective with a hypothetical scenario.

If you make $100,000 of taxable income each year, you fall into the 24% tax bracket. However, not all of your $100,000 is getting taxed at 24%. For the sake of this explanation, let’s pretend there are no other factors like deductions or retirement contributions.

Only the first $10,275 will be taxed at 10%; only the amount of income from $10,276 to $41,775 will be taxed at 12%; then, only the amount from $41,776 to $89,075 will be taxed at 22%; only the amount from $89,076 to $100,000 will be taxed at 24%.

Then, all these are added together for your total amount of income owed. In the end, with $100,000 of taxable income, you would pay a total of $17,835.26.

Since this system combines several tax brackets into a single amount, there’s no official percentage you’re getting taxed on; it’s unique to each person’s taxable income.

With some simple math, Bank of America explains a way to find your “effective tax rate”, a calculation that determines what percentage of your income you’re paying in taxes. Once you find the total tax your paying, divide that number by your total taxable income.

In our $100,000 hypothetical, the solution would be a 17.8% effective tax rate.

It’s important to keep in mind that this is the simplest explanation of tax brackets. Many numbers and factors can change depending on how much you deduct from your income, and whether you’re filing as a single person, a married couple, the head of household, etc.