What is a Tax Bracket? 🤔
Tax brackets are different rates of income tax based on how much you earn over a year. When you make more money, only the extra amount is taxed at a higher rate, not all of your money.
Why Tax Brackets Matter 💡
Tax brackets help make sure you don’t pay a higher rate on all your income, just on the extra money you make that falls into a higher bracket. WorkMade keeps track of the rates, and will average your income out over all that apply, so that you don't have an increasing tax rate over the year.
How Tax Brackets Work
How Taxes Increase 📈
As your income goes up, only the part that moves into the next bracket is taxed at a higher rate.
For example, if you move from 10% to 12%, only the extra money above 10% is taxed at 12%.
Big Freelance Payments 🏄
Large payments might push some of your income into a higher tax bracket, but only the extra amount will be taxed more.
How Tax Rates Work 💵
Everyone starts in the lowest bracket (10%). As your income grows, only the income above each limit is taxed at the next higher rate.
Why It Looks Higher 🤗
In regular jobs, taxes are taken out evenly. But with freelance income, big payments can look like they’re taxed more since they weren’t spread out.
How WorkMade Helps 🤝
Automatic Tax Calculations 🤖
We do the math for you to make tax time easier.
No Surprises 🎊
WorkMade helps keep track of your income so you know how much to save for taxes and avoid any unexpected bills.
Finding Deductions 🔍
WorkMade helps you find ways to lower your taxes with deductions.
Help with Payments ❓
We calculate your taxes and help you pay the IRS and state taxes on time.
Example
If you earn $50,000, most of your income is taxed at 12%. If you get a $10,000 bonus, only the extra $10,000 is taxed at 22% (the next bracket up), not the entire $60,000.
WorkMade makes taxes simple, helping you manage them easily and save money.
📓 Each tax situation is unique. WorkMade provides general info based on guidelines from tax authorities, which may change over time. For more details, refer to Regulation CC.