Figuring the Regular Tax
A taxpayer's regular income tax is based on taxable income, which is gross income reduced by various adjustments (such as individual retirement account [IRA] deductions and alimony), the standard deduction or itemized deductions, and personal and dependent exemptions. Taxable income is calculated before taking into account any tax credits that the taxpayer may claim.
The method used to determine a taxpayer's tax liability depends on whether taxable income equals or exceeds $100,000 and whether taxable income includes certain types of income.
Keep in mind that the regular tax is only a tentative number. The final tax liability depends on whether the taxpayer owes any alternative minimum tax (see Chapter 33), other taxes, and whether the taxpayer qualifies for any tax credits.
Taxable income is the result of several computations:
Regular Tax Computation Options ...