Q:

How do you use an income tax return calculator?

A:

Quick Answer

Individuals enter information about filing status and taxable income into a tax return calculator to determine how much federal income tax they owe, according to TaxAct. After entering the information, the tax calculator provides an estimate of the income tax owed, tax percentage and tax bracket.

Continue Reading

Full Answer

To use a federal income tax calculator, individuals must first determine their filing status, which can be single, married filing jointly, married filing separately or head of household. Filers must select the status that is applicable to their tax circumstances. Once filing status is selected, individuals must enter their taxable income into the calculator. People determine taxable income by taking the regularly taxed income and subtracting deductions and exemptions, explains TaxAct. The calculator evaluates this information and provides an estimate of income tax owed, the rate at which taxes are calculated, and the applicable tax bracket.

Some tax calculators request additional information in order to provide a more accurate estimate of income tax owed. For example, some calculators request more detailed information about income, such as total wages, income tax already withheld and income other than wages earned. Additionally, some calculators collect information about expenses such as charitable donations, student loan interest payments and child care expenses to help determine applicable deductions, according to H&R Block.

Learn more about Income Tax

Related Questions

Explore