US Money Guides

Understanding US Tax

The US tax system is one of the most complex in the world. Federal income tax, FICA, state taxes, capital gains, self-employment tax, estate tax, and dozens of credits and deductions all interact in ways that are hard to understand without help. Our guides break down the most common areas into plain English.

Each guide is paired with one or more calculators so you can see how the rules apply to your specific numbers.

Key US Tax Concepts

• Standard deduction ($15,000 single filer): The amount subtracted from your income before calculating federal tax. Most taxpayers take the standard deduction rather than itemizing.
• Progressive tax brackets: Your income is divided into portions, each taxed at a different rate. Only the income within each bracket is taxed at that rate — not your entire income. Rates range from 10% to 37%.
• FICA (Social Security + Medicare): Taken from every paycheck. Social Security is 6.2% up to $176,100. Medicare is 1.45% with no cap, plus 0.9% above $200,000.
• Self-employment tax: If you are freelance or 1099, you pay both the employee and employer portions of FICA — 15.3% total on 92.35% of net earnings.
• Capital gains: Profits from selling investments. Long-term (held over 1 year) gets preferential rates of 0%, 15%, or 20%. Short-term is taxed as ordinary income.
• Tax year: January 1 to December 31. Filing deadline: April 15 of the following year.
• Quarterly estimated taxes: Self-employed people and those with significant non-wage income must pay quarterly (April 15, June 15, September 15, January 15).

Tax Calculators

Every concept above has a calculator to go with it:

• Salary Calculator — take-home pay after federal tax and FICA
• Self-Employment Tax — 1099/freelance tax bill
• Capital Gains Tax — short-term and long-term rates
• Tax Refund Estimator — will you get a refund or owe?
• W-4 Withholding — per-paycheck federal tax
• Child Tax Credit — $2,000 per child credit

Retirement & Savings

• 401(k) Calculator — contributions, employer match, and tax savings
• Roth IRA Calculator — tax-free retirement growth projections
• Social Security — benefit estimates at different claiming ages

Property & Loans

• Mortgage Calculator — monthly payments and total interest
• Auto Loan Calculator — car payment estimates
• Property Tax — annual tax by home value and rate
• Student Loan — monthly payments and total cost

Work & Everyday

• Hourly to Salary — convert hourly wage to annual pay
• Overtime — FLSA time-and-a-half calculations
• Minimum Wage — federal and state rates
• Sales Tax — state-by-state rates
• Tip Calculator — tip amount and bill splitting
• Inflation — purchasing power over time