And how do I know which one I'm on?
No it's not right. Only the amount of your additional income that goes above the limit for the next bracket is taxed at the higher rate. Everything else is taxed at the same rates it was before. You don't pay the higher bracket percent on your entire income. So no, it's not possible to make less net income because you are now in a higher bracket.
A tax bracket is an interval of income that is taxed at a flat rate. For example, for a single person, taxable income between: $0 and $8,025 is taxed at 10% $8,026 and $32,550 is taxed at 15% $32,551 and $78,850 is taxed at 25% and so on.
It's the rate that your last dollar of income is taxed at. To see which bracket you're in, look at the Taxable Income line of your tax return and compare it to this chart: irs /formspubs/article/0,,
Actuallythe use of the term bracket is a very old one and it is really a percentage. The best way to find out what your exact tax percentage is would be to look at your last tax return. Divide the total tax by your taxable income.
