Methodology & Sources
What tax codes power
this calculator.
Every number this calculator produces traces back to a specific IRC section, IRS revenue procedure, or enacted legislation. This page documents each parameter, its source authority, and when we last updated it.
Federal Tax Parameters
IRS revenue procedures & enacted legislation
Federal parameters live in in our backend, but our methodologies are displayed below.
7 rates: 10% – 37%
Thresholds inflation-adjusted annually. 2025: single 10% bracket ends at $11,925.
7 rates: 10% – 37%
Rates unchanged; thresholds stepped up ~2%. 2026: single 10% bracket ends at $12,400.
Single $15,750 · MFJ $31,500 · HOH $23,625
OBBBA retroactively raised the 2025 amounts above the Rev. Proc. 2024-40 baseline of $15,000 / $30,000 / $22,500.
Single $16,100 · MFJ $32,200 · HOH $24,150
$40,000 (MFJ/Single/HOH) · $20,000 (MFS); 30% phase-down above $500k MAGI; 1% annual growth; reverts to $10k in 2030
Pre-OBBBA cap was $10,000 (TCJA 2017). Phase-down: every dollar of MAGI above $500k reduces the cap by $0.30, floored at $10k.
$750,000 acquisition debt ($375,000 for MFS)
Applies to loans originated after Dec 15, 2017. Pre-TCJA limit was $1M.
Not available (deduction lapsed)
OBBBA reinstated the deduction effective tax year 2026. It had lapsed after 2021.
Full deduction up to AGI $100,000; linear phase-out to $110,000 (MFS: $50k/$55k)
Single $88,100 · MFJ $137,000
Phase-out begins at $626,350 (single) / $1,252,700 (MFJ) at 25% rate.
Single $90,100 · MFJ $140,200; phaseout starts $500k (single) / $1M (MFJ) at 50% rate
Critical OBBBA change: phaseout thresholds compressed and rate doubled (25% → 50%). The exemption now disappears twice as fast for high earners.
26% up to threshold · 28% above
2025 threshold: $239,100. 2026 threshold: $244,500.
State Tax Parameters
50-state bracket database
State parameters live in src/lib/state-tax-parameters.ts. States are encoded individually — no external API is called at runtime. The entries below highlight states with notable recent changes or non-standard rules.
Each state's brackets are encoded directly. 7 states have no income tax (AK, FL, NV, SD, TN, TX, WY).
Simplified from 7 brackets (top 6.1%) to 3 brackets: 0% / 4.7% / 5.9%. Zero-rate band reflects MT standard deduction baked into withholding.
Top rate reduced from 6.84% → 4.6% as part of the LB 754 multi-year reduction. Prior code had an outdated 8.4% top rate.
Top rate reduced from 5.5% → 4.5%; structure simplified from 6 to 4 brackets.
CA has its own AMT at 7% with separate exemptions ($92,749 single / $123,667 MFJ) and phaseout thresholds.
CA allows interest on up to $1,000,000 of acquisition debt ($500k MFS) — higher than the federal $750k limit.
Calculation Engine
How each module works
All calculation logic is pure TypeScript with no side effects. The pipeline runs on every input change — there is no submit button and no server round-trip for calculations.
OBBBA phase-down: 30% reduction on MAGI above threshold; 1% annual cap growth 2026–2029; reverts to $10k floor in 2030
Year-1 interest computed by full amortization schedule; pro-rated if loan > $750k acquisition debt cap
Limited to remaining SALT bucket after state income tax and personal property tax are applied
Linear phase-out between $100k (full) and $110k (zero) AGI; unavailable before 2026
AMTI computed, exemption phased out per year-specific rate, tentative minimum tax at 26%/28%; actual tax = max(regular, AMT)
Standard marginal progression using year-specific brackets from federal-tax-parameters.ts
State bracket progression using state-specific parameters; state homeowner deductions applied separately
Official References
Primary sources
2025 inflation adjustments — brackets, AMT, standard deduction baselines
2026 inflation adjustments — brackets, AMT, standard deduction final values
Signed 2025-07-04 — SALT, PMI reinstatement, AMT restructure, std deduction increases
Qualified residence interest and acquisition debt limits
State and local tax deduction limitation
Alternative minimum tax computation, exemption, and preferences
AMT computation worksheet — mirrors our AMT calculation logic
Home mortgage interest deduction — amortisation and debt limit rules
Disclaimer
This page documents our sources and methodology. It does not constitute tax advice. Tax law is complex and fact-specific — calculator outputs are estimates for educational purposes. Always verify with a licensed CPA or tax attorney before making financial decisions. If you spot an error or an out-of-date value, let us know.