In order to calculate an individual federal income tax for the 2013 to 2014 fiscal year, first take the taxpayer's tax bracket, analyze the filling status, remove gross deductions and make final adjustments based on dependants and other factors. Without proper planning and knowledge, the tax burden appears uncertain, according to CalcXML.
The most important factor in determining annual income taxes is discovering the taxpayer's tax bracket. These brackets are divided according to gross salary earned for the previous year, according to Tax Act. The lowest bracket starts at a tax rate of 10 percent, and the highest rate is nearly 40 percent. After determining the bracket, the taxpayer must determine what type of filing he must do. The different modes are single filers, married filing jointly, married filing individually, widows and widowers, and head of household. The different modes provide different caps for each tax bracket.
After determining the tax bracket and tax mode, the taxpayer removes any specific itemized deductions. Types of deductions include charitable donations, loss of income via investments and dependent children, states Tax Act. Finally, it is possible to include specific contributions such as a 401(k) plan or an IRA contribution. It is possible to receive a strong estimate through online calculators, such as Tax Act.