The federal tax schedule or table is a chart devised by the Internal Revenue System that aids the taxpayers in determining the federal income tax incurred for a particular year. The tax table is divided into three columns. The first two columns denote the range of the income of the taxpayer. The last column indicates the tax rate for a given income bracket. The federal tax table is based on the filing status of the taxpayer. The federal tax table utilizes for filing status, these are: single (Schedule X), married filing jointly or qualifying widow or widower (Schedule Y-1), married filing separately (Schedule Y-2) and the head of household (Schedule Z).
Here is the 2007 Federal Income Tax Schedule (based on IRS):
Schedule X (Single)
Lowest ValueHighest ValueTax Rate$0$7,82510.0%$7,826$31,85015.0%$31,851$77,10025.0%$77,101$160,85028.0%$160,851 $349,70033.0%$349,701Above35.0%
Schedule Y-1 (Married filing jointly or qualified widow or widower)
Lowest ValueHighest ValueTax Rate$0$15,65010.0%$15,651$63,70015.0%$63,701$128,50025.0%$128,501$195,85028.0%$195,851 $349,70033.0%$349,701above35.0%
Schedule Y-2 (Married filing separately)
Lowest ValueHighest ValueTax Rate$0$7,82510.0%$7,826$31,85015.0%$31,851$64,25025.0%$64,251$97,92528.0%$97,926$174,85033.0%$174,851above35.0%
Schedule Z (Head of Household)
Lowest ValueHighest ValueTax Rate$0$11,20010.0%$11,201$42,65015.0%$42,651$110,10025.0%$110,101 $178,35028.0%$178,351$349,70033.0%$349,701above35.0%
In order to fully utilize the 2007 Federal tax table, the taxpayer should know the proper filing status where he or she belongs. A careful examination of income value should be done in order to properly assess which income bracket should used to computer for the tax. For example, a taxpayer belongs to the head of household filing status and has an income of $42,652. The proper table to be used is Schedule Z since this table is for head of household filers. The table suggests that the taxpayer is on the income bracket of $42,651 to $110,100; this corresponds to a tax rate of 25.0%. To compute for the total amount of tax to be paid, the taxpayer should deduct the highest value of the first bracket with the lowest value of the same bracket and multiply it with tax rate for that bracket. This will be repeated until the taxpayer's bracket is reached. For the bracket of the taxpayer, instead of using the highest amount, the income value will be used and then it will be subtracted with the lowest value for that bracket and multiply it by the tax rate. All the products will be added and the sum will be the amount of tax to be paid. In the case of our example, the amount of tax is $5,838.