How to Find Your New Tax Bracket

The document from 1982 provided guidance on determining one's tax bracket and marginal tax rate, which are crucial for financial planning. It explained that the marginal tax rate is the rate at which the next dollar of income is taxed and that this rate increases as income rises. The text offered examples of how to apply knowledge of tax brackets and marginal rates to assess the financial impact of salary increases, investments, and tax-deductible expenses. It also covered the tax treatment of capital gains and the calculation of the real cost of loan interest after taxes. The impact of state income taxes on the overall tax rate was discussed, including a formula for calculating the total marginal tax rate with both federal and state taxes. Tables for tax rates applicable to individuals and corporations were included, pointing out the tax benefits of corporate formation.