How Our Tax Calculator Works
Transparent, accurate, and based on official IRS guidelines
Calculation Methodology
Our Head-of-Household tax calculator uses the official 2025 IRS tax brackets and formulas to provide accurate tax estimates. Here's exactly how we calculate your taxes:
Calculate Adjusted Gross Income (AGI)
We start with your gross income and subtract pre-tax deductions:
Apply Standard or Itemized Deduction
For 2025, the HOH standard deduction is $22,500. We use the higher of:
- Standard deduction ($22,500)
- Your itemized deductions (if you provide them)
Calculate Federal Tax by Bracket
Federal taxes use a progressive bracket system. We calculate tax for each bracket your income reaches:
| Income Range | Tax Rate |
|---|---|
| $0 - $11,925 | 10% |
| $11,925 - $45,500 | 12% |
| $45,500 - $93,350 | 22% |
| $93,350 - $177,650 | 24% |
| $177,650 - $225,950 | 32% |
| $225,950 - $626,350 | 35% |
| Over $626,350 | 37% |
Apply Tax Credits
We calculate and apply eligible tax credits:
- Child Tax Credit: $2,000 per qualifying child (phases out above $200,000 AGI)
- Earned Income Credit: For lower-income filers with children (up to $7,830 for 3+ children)
Calculate FICA Taxes
FICA taxes are calculated on gross income:
- Social Security: 6.2% on income up to $176,100 (2025 wage base)
- Medicare: 1.45% on all income
- Additional Medicare: 0.9% on income over $200,000 for HOH
Calculate State Taxes
State tax calculation varies by state:
- No Income Tax States: 9 states (AK, FL, NV, NH, SD, TN, TX, WA, WY)
- Flat Rate States: Single rate applied to all income (e.g., IL at 4.95%)
- Progressive States: Multiple brackets like federal (e.g., CA, NY)
Calculate Final Results
We provide comprehensive results:
Data Sources
Our tax calculations are based on official government sources:
- IRS.gov: Federal tax brackets, standard deductions, and credit amounts from official IRS publications
- State Revenue Departments: Each state's tax rates from their official Department of Revenue websites
- SSA.gov: Social Security wage base and FICA rates from the Social Security Administration
Last updated: November 15, 2024 for tax year 2025
Accuracy & Limitations
What we include: Federal income tax, state income tax, FICA (Social Security and Medicare), standard/itemized deductions, Child Tax Credit, and Earned Income Credit.
What we don't include: Additional credits (education, retirement savings, etc.), Alternative Minimum Tax (AMT), self-employment tax beyond standard FICA, local/city taxes, or complex scenarios like multiple jobs or capital gains.
Disclaimer: This calculator provides estimates only. Your actual tax liability may differ based on your specific circumstances. Consult a tax professional for official tax advice.