United States

Individual - Sample personal income tax calculation

Last reviewed - 06 February 2021

Assumptions

Calendar year 2021

Resident alien husband and wife with two children, both of whom qualify for the child tax credit; one spouse earns all the income, none of which is foreign-source income. A joint return is filed. AMT liability is less than regular tax liability.

Calculations based on 2020 tax tables.

Tax computation

USD
Gross income:
Salary 150,000
Interest 18,500
Long-term capital gain (on assets held for more than one year) 3,000
Total gross income 171,500
Adjustments 0
Adjusted gross income (AGI) 171,500
Less:
Standard deduction (25,100)
Taxable income 146,400
Tax thereon:
On taxable income of 143,400 (146,400 less capital gain of 3,000) at joint-return rates 22,045
On 3,000 capital gain at 15% 450
Total tax before credits 22,495
Less:
Credits (child tax credit equal to 2,000 per child) (4,000)
Net tax 18,495