What Is a Tax Table?

A tax table is a chart that displays the amount of tax due based on income received. The tax rate in the table may be shown as a discrete amount, a percentage rate, or a combination of both. Tax tables are used by individuals, companies, and estates for both standard income and capital gains.

Understanding Tax Tables

Business and individual taxpayers pay an effective tax rate on their income every year. The tax paid by each entity depends on a number of factors, such as filing status, applicable tax deductions and credits, exemptions, and the amount of income earned in a given tax year. Based on these factors and the tax rates set for the year, taxpayers and taxing authorities can determine the amount of tax to be paid by each taxpayer.

A typical tax table will show breakpoint income levels, above and below which different tax rates will apply. However, the income used in tax tables is taxable income, not the gross income. Taxable income refers to gross income minus deductions. Thus, only the dollar amount that is left after factoring in deductions is subject to income tax. For example, the standard deduction for 2020 is $12,400 for single taxpayers. A taxpayer that earns $65,000 for the year and only qualifies for the standard deduction will pay income tax on $65,000 - $12,400 = $52,600. Generally speaking, the higher a taxpayer’s taxable income, the more s/he is taxed.

Tax tables are set up with different columns for each filing status and rows of various taxable income amounts on the left. Depending on one’s filing status – single, married filing separately, married filing jointly, or head of household – his or her tax liability can be traced on the table, and the amount transferred to the individual's income tax form. Qualifying widows or widowers can use the married filing jointly category. The following is an example of a 2017 tax table for taxpayers in the $46,000 taxable income range:

IRS Tax Table for 2017

IRS Tax Table for 2017
 

46,000

 

46,050

 

7,245

 

5,971

 

7,245

 

6,236

 

46,050

 

46,100

 

7,258

 

5,979

 

7,258

 

6,244

 

46,100

 

46,150

 

7,270

 

5,986

 

7,270

 

6,251

 

46,150

 

46,200

 

7,283

 

5,994

 

7,283

 

6,259

 

46,200

 

46,250

 

7,295

 

6,001

 

7,295

 

6,266

 

46,250

 

46,300

 

7,308

 

6,009

 

7,308

 

6,274

 

46,300

 

46,350

 

7,320

 

6,016

 

7,320

 

6,281

 

46,350

 

46,400

 

7,333

 

6,024

 

7,333

 

6,289

 

46,400

 

46,450

 

7,345

 

6,031

 

7,345

 

6,296

 

46,450

 

46,500

 

7,358

 

6,039

 

7,358

 

6,304

 

46,500

 

46,550

 

7,370

 

6,046

 

7,370

 

6,311

 

46,550

 

46,600

 

7,383

 

6,054

 

7,383

 

6,319

 

46,600

 

46,650

 

7,395

 

6,061

 

7,395

 

6,326

 

46,650

 

46,700

 

7,408

 

6,069

 

7,408

 

6,334

 

46,700

 

46,750

 

7,420

 

6,076

 

7,420

 

6,341

 

46,750

 

46,800

 

7,433

 

6,084

 

7,433

 

6,349

 

46,800

 

46,850

 

7,445

 

6,091

 

7,445

 

6,356

 

46,850

 

46,900

 

7,458

 

6,099

 

7,458

 

6,364

 

46,900

 

46,950

 

7,470

 

6,106

 

7,470

 

6,371

 

46,950

 

47,000

 

7,483

 

6,114

 

7,483

 

6,379

Tax tables are used most often by individuals and companies with modest levels of income. High-income earners, whether individuals or corporations, tend to use more detailed tax rate schedules in conjunction with itemized deductions.

Most states use tax tables to determine personal income tax. The seven states that do not assess personal income tax are Nevada, Texas, Washington, Alaska, Florida, South Dakota, and Wyoming. Tennessee and New Hampshire only assess a tax on dividend and interest income. Tax tables will change from year to year and will vary from state to state. Investors should always be sure that they are using the correct tax tables based on their income sources and area of residence.