What is the Federal Income Tax Table?

The Federal Income Tax Table, otherwise known as tax brackets, is a table designed by the IRS to indicate the amount of taxes you are responsible for paying to the IRS. The number used to find your position in the tax table is not based on your gross income, but rather your AGI. 

The Federal Income Tax Table

This table is made up of an ascending list of possible taxable income, in $1,000 blocks, from $0 to $99,000. The number on line 43 of your tax return is used on the Federal Income Tax Table to determine how much tax you owe, which depends on your filing status and other numbers. You arrive at the number on line 43 by carrying over your AGI from the first page to the second page and subtracting your number of dependants (exemptions) and your itemized or standard deductions.

What Is AGI?

AGI stands for Adjusted Gross Income. Your AGI is calculated on the first page of your tax return using all your income and credit for dependents minus certain deductible expenses. If you've ever filled out your own tax return forms, it is the final number you arrive at on the first page of your return. You carry that one over to the top of the second page.  

Itemized Vs. Standard Deductions

If you have your own business, chances are you will choose to itemize your tax return. This requires a Schedule C. If you have worked for someone else during the tax year, you are provided with a W-2 form, which tells you your yearly income to report. In that case, you will use a number for your standard deduction that is in alignment with your filing status.