Calculating your taxes using the tax rate table provided by the Internal Revenue Service gives you an idea of your income tax before you file a return. You might want this information out of curiosity, but you can also use the information as a tool to determine if you’re having the right amount of income tax withheld from your pay. If you discover you’re having too little or too much withheld, you can make adjustments to the withholding allowance certificate you give your employer.
Download a Form 1040 and the tax table for the most recent year from the IRS website. You’ll use the 1040 to estimate some of your deductions.
Calculate your gross income from all sources for the year. Your gross income equals amounts you are paid before taxes, expenses and other deductions.
Subtract expenses. If you’re self-employed or receive a 1099-MISC for nonemployee compensation, estimate your expenses related to the 1099 income.
Subtract your personal exemption amount and the standard deduction for your filing status. On page two of the 1040 form, you’ll see standard deduction amounts in the upper left margin and personal exemption amounts on line 42. Multiply the personal exemption amount by the number of people you’re claiming on your tax return. For example, if you and a spouse file a joint return, multiply the personal exemption amount by two. The result after this subtraction is your taxable income.
Look at the tax rate tables. Find the table for your taxable income range and scroll over to the column for your filing status. The tax shown is an estimate of your income taxes for the year. These taxes may be offset by federal income taxes withheld from your pay and other credits.
- You may qualify for deductions on lines 23 through 36 of Form 1040. These deductions reduce your taxable income and income taxes. If you're eligible for any of the deductions, review Form 1040 instructions to estimate additional amounts you can deduct.
With a background in taxation and financial consulting, Alia Nikolakopulos has over a decade of experience resolving tax and finance issues. She is an IRS Enrolled Agent and has been a writer for these topics since 2010. Nikolakopulos is pursuing Bachelor of Science in accounting at the Metropolitan State University of Denver.