Income Tax Calculator
Wondering how to estimate your 2021 tax refund?
Just answer a few simple questions about your life, income, and expenses, and our free tax calculator will give you an idea if you should expect a refund and how much, or if you’ll owe the IRS when you file taxes in 2021.
- Basic Info
Officially known as the Tax Cuts and Jobs Act, 2018 tax reform included many adjustments to tax law and how taxpayers are affected. Find up-to-date information on tax reform and answers to commonly asked questions.
The purpose of tax deductions is to decrease your taxable income, which then decreases the amount of taxes you need to pay to the federal government. To help you reduce your taxable income, we aggregated a huge list of deductions many people often overlook or aren’t sure how to use them to their advantage.
For tax purposes, your adjusted gross income or AGI is essentially your total or gross income minus eligible deductions. You can use our AGI calculator to estimate your adjusted gross income using the most common income and deductions for US taxpayers.
Your tax bracket shows you the tax rate that you will pay for each portion of your income. For example, if you are a single person, the lowest possible tax rate of 10 percent is applied to the first $9,525 of your income in 2021 . The next portion of your income is taxed at the next tax bracket of 12 percent. That continues for each tax bracket up to the top of your taxable income. Find yours with our helpful tax bracket calculator.
Most income is taxable, whether you earn it or are paid as a return on your investment. Also, you generally have to pay tax on income when you sell something for more than your basis (usually the amount you paid for something).
If a type of income is taxable, it doesn't matter if you receive payment in cash, by check or electronic payment, or in the form of goods or services. You still pay tax on it.
Certain types of income are excluded from tax. This generally includes income you or someone else has already paid tax on, or income from special situations, such as combat pay.
Your tax filing status makes a big difference in your tax return when you file.
Many people simply choose the status they believe best fits their personal situation, but in some cases, you may have more than one option. At that point, it’s up to you to pick the status that offers you the most tax advantages. Filing status options are:
Head of Household
Married Filing Jointly
Married Filing Separately
Qualified Widow or Widower
Credits differ from deductions and exemptions because credits reduce your tax bill directly. After calculating your total taxes, you can subtract any credits for which you qualify. Some credits address social concerns for taxpayers, like The Child Tax Credit, and others can influence behavior, like education credits that help with the costs of continuing your education.
There are numerous credits available for a wide range of causes, and all reduce your tax liability dollar for dollar. That means a $1,000 tax credit reduces your tax bill by $1,000. Reviewing all the options may be time-consuming, but could also prove to be profitable.
Some major tax credits are:
Foreign tax credit
Credit for child and dependent care expenses
Retirement savings contribution credit (Saver's Credit)
Child tax credit
Residential energy credits
Exemptions are portions of your personal or family income that are ‘exempt’ from taxation. The Internal Revenue Code allows taxpayers to claim exemptions that reduce their taxable income. Both personal and dependent exemptions lower the amount of your taxable income. That ultimately reduces the amount of total tax you owe for the year.
For tax purposes, all dependents receive exemptions, including you and your spouse. To the Internal Revenue Service (IRS), these are the people for whom you are financially responsible. A higher number of exemptions reduces your taxable income. In most cases, dependents must be:
A family member or qualified relative
Age 18 or below (except for full-time college students under age 24)
Cannot provide over half of their economic support.
You can reduce your taxable income by multiplying the dollar value of a personal exemption, which is a predetermined amount, by the number of your dependents. For example, in 2017, the personal exemption is $4,050. It’s the same amount for your spouse and each dependent as well. These exemptions are reduced if your adjusted gross income (AGI) exceeds $261,500 as a single filer or 313,800 if you’re married and file a joint return.
Example: Josh and Kristen are married with a combined income of $90,000. They have three children whom they claim as dependents. That means they can claim five exemptions of $4,050 each. That reduces their taxable income by $20,250.
TaxAct Costs Less: “File for less” and percentage savings claims based on comparison with TurboTax federal pricing for paid consumer online 1040 filing products on 09/23/2022.
Maximum Refund Guarantee: If an error in our software causes you to receive a smaller refund or larger tax liability than you receive using the same data with another tax preparation product, we will pay you the difference in the refund or liability up to $100,000 and refund the applicable software fees you paid us. Find out more about our Maximum Refund Guarantee.
$100k Accuracy Guarantee: If you pay an IRS or state penalty or interest because of a TaxAct calculation error, we'll pay you the difference in the refund or liability up to $100,000. This guarantee applies only to errors contained in our consumer prepared tax return software; it doesn't apply to errors the customer makes. Find out more about our $100k Accuracy Guarantee.
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Deduction Maximizer: TaxAct's Deduction Maximizer guides you step by step through the process of completing your return in a way that helps you uncover additional tax advantages and helps you maximize your deductions by checking dozens of additional deductions we know from experience folks don't think to look for. Each deduction you claim may reduce the amount of tax you owe, resulting in a lower IRS bill overall.
All-Inclusive: All-inclusive is a collection of select products and services that may be used to enhance your DIY 1040 tax preparation and filing experience. The offer does not include additional state(s) returns or TaxAct Full Service℠ where a tax professional prepares a return on your behalf. TaxAct® Xpert Assist Offer for free TaxAct Xpert Assist™ may expire at any time without notice. TaxAct Xpert Assist™ available as an added service . If you choose to pay for your bundle using Refund Transfer, then the Refund Transfer is no additional cost to you and will be included in the bundle price. 50% savings based on a la carte pricing. Final price, including added sales taxes, is determined at the time of filing and subject to change without notice.
My TaxPlan™: Your customized My TaxPlan features potential refund-growing opportunities and easy-to-follow instructions based on information you provide for your current tax return. Refund boost claimed in advertising calculated using recent IRS statistics and trade press regarding contributions to retirement accounts. We will highlight other potential savings, too, so your refund boost could be bigger.
Refund Transfer: Refund Transfers are fee- based products offered by Republic Bank & Trust Company, Member FDIC. A Refund Transfer Fee and all other authorized amounts will be deducted from the taxpayer’s tax refund.
Audit Defense: See Audit Defense provided by Tax Protection Plus (PDF) for further details of services and requirements. May not apply to certain forms and credits. Certain customers may not qualify for services based on past tax audit history, residency, or other factors. Audit Defense is not insurance. Audit Defense is subject to terms and conditions (PDF) located on Tax Protection Plus's website.
Refer-A-Friend: Offer valid through October 15, 2022. For each friend you refer to TaxAct who did not prepare and file using us last year, you get a $20 Amazon.com Gift Card after they file their taxes using TaxAct’s 2021 Deluxe, Premier or Self-Employed product. Even better, they get 20% off our federal tax filing products by using the share link you provide! It’s not every day you get to be somebody’s hero and make money doing it.
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Over 85 Million Returns Filed: Based on e-filed federal returns through TaxAct Consumer and TaxAct Professional software since 2000.
Return Import: TaxAct can import the data you filed last year with us or your return from PDF files of 1040 returns prepared by many but not all tax prep software solutions.
Quick Start Options: Quick start options include PDF import, prior year import, and W-2 photo capture. To import your prior year return, you must either have a PDF copy of a return available or have filed your return the previous year with TaxAct. To capture your W-2 with a camera with your phone, you must be able to download and install TaxAct's mobile app and grant it the necessary camera and image privileges. To ensure accuracy, we will ask you to review any information we're able to import (either through PDF import, prior year import, or W-2 photo capture) and review it for accuracy. These quick start options save time by not requiring you to enter some of your information manually.
Most Popular: TaxAct Deluxe is our most popular product among our online customers with more complex tax situations.
Refund Amounts Shown: Actual refund amounts vary based on your tax situation. Number shown in illustrations are based on IRS published data stating that average 2021 tax refunds were more than $2800. See IRS article for more information.
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