The effective tax rate is the percent of income or pre-tax profits that an individual or a corporation pays in taxes.

The Internal Revenue Service has released its new marginal tax rates for next year. For 2025, tax adjustments will generally apply to income tax returns to be filed starting in the 2026 tax season.

The highest marginal income tax rates in 2026 reach as high as 13.3 percent, with California leading the nation—making location one of the biggest financial factors for high earners this year. If ...