“How much tax will I pay if I take $30,000 out of my IRA?” sounds like it should have a one-line answer. It doesn’t. The withdrawal stacks on top of your other income, it can drag your Social Security into tax with it, and before 59½ there’s a penalty on top. I built a retirement withdrawal tax calculator to do that arithmetic properly for one year, and to show the number most people never see: what the next dollar costs.
It’s free, no signup, and it uses the 2026 federal brackets. I’m 58, single, retired early, and planning my own drawdown, so I use it too.
What the retirement withdrawal tax calculator does
Money out of a traditional IRA or 401(k) is ordinary income, taxed like a paycheck. The IRS spells that out in Publication 590-B on IRA distributions, along with the 10% additional tax on most withdrawals before 59½. Because the withdrawal sits on top of everything else you earned, the rate that matters is the marginal one, not the average.
So the calculator doesn’t just run the withdrawal through the brackets. It works out your federal tax twice, once with the withdrawal and once without, and reports the difference. You give it six things: filing status (single or married filing jointly), the withdrawal, your other taxable income (pensions, wages, interest and the like), your Social Security benefits for the year, how many people are 65 or older, and whether you’re under 59½.
It gives back the tax the withdrawal adds, the 10% penalty if you ticked the box, the effective rate on the withdrawal, your bracket, the tax on the next $1,000, and your total federal tax for the year. Underneath, it tells you your taxable income, how much room is left in your bracket, and how much more of your Social Security the withdrawal made taxable.
The deductions it uses are the 2026 ones: a $16,100 standard deduction single or $32,200 married, plus $2,050 for a single filer 65 or older ($1,650 per spouse 65 or older if married), plus the 2025–2028 senior deduction of $6,000 per person 65 or older, which shrinks by 6% of income above $75,000 single or $150,000 married. For a single filer the 2026 brackets are 10% up to $12,400 of taxable income, 12% up to $50,400, 22% up to $105,700 and 24% up to $201,775, with 32%, 35% and 37% above that.
A worked example: $30,000 out, with Social Security
Single, 67, $30,000 a year of Social Security, $5,000 of interest, and a $30,000 IRA withdrawal. That’s the screenshot above. Here is the math the tool does, step by step.
Without the withdrawal. The test for taxing Social Security uses “provisional income”: other income plus half of the benefits. That’s $5,000 + $15,000 = $20,000. For a single filer, below $25,000 none of the benefits are taxable. AGI is $5,000, the deductions are far bigger than that, and the tax is zero.
With the withdrawal. Other income is now $35,000 and provisional income is $35,000 + $15,000 = $50,000. That’s $16,000 above the second threshold of $34,000. Taxable Social Security is 85% of that $16,000 ($13,600) plus the $4,500 from the band between $25,000 and $34,000, so $18,100, which is under the 85% cap of $25,500. AGI is $35,000 + $18,100 = $53,100. The deduction is $16,100 + $2,050 + $6,000 = $24,150 (the senior deduction is whole, since income is under $75,000). Taxable income is $28,950.
Tax: 10% of the first $12,400 is $1,240, plus 12% of the remaining $16,550 is $1,986. Total $3,226. Against a $30,000 withdrawal, that’s a 10.8% effective rate, and the bracket is 12%. So far, nothing alarming.
The next $1,000. This is where it gets interesting. Another $1,000 of withdrawal raises provisional income by $1,000, which makes another $850 of Social Security taxable. Taxable income goes up by $1,850, all at 12%: $222. That’s a 22.2% marginal rate in the 12% bracket. The calculator flags it in plain words: your rate on the next dollar is above your bracket because each extra dollar also makes more Social Security taxable.
Both numbers are right, and they answer different questions. The 10.8% is what this withdrawal cost. The 22.2% is what one more dollar costs, In this example it lasts for about another $8,700 of withdrawals, until 85% of the benefits are taxable. After that, the next dollars drop back to 12% until the bracket runs out. So the cheapest dollars are not where the bracket table says they are. (I find that a bit insulting, honestly, but it’s the law.)
The same idea before 59½
Early retirees have a different problem. Take a single filer under 59½ with no other income and no Social Security yet, pulling $40,000 from an IRA. Taxable income is $40,000 − $16,100 = $23,900. Tax is $1,240 + 12% of $11,500 = $2,620. The penalty is 10% of $40,000, or $4,000. Total $6,620, a 16.6% effective rate, and the penalty is bigger than the tax.
The IRS has exceptions, such as leaving your job in or after the year you turn 55 (for a 401(k)) and substantially equal periodic payments. The calculator applies the penalty whenever you tick the box, so leave it unticked if an exception covers you. A lot of early retirees get around the penalty a different way, with a Roth conversion ladder, which has its own blind spot.
What it leaves out
It’s a federal, one-year, ordinary-income calculator. I’d rather say what it skips than have someone trust it past its edge:
- State income tax.
- Long-term capital gains and qualified dividends, which have their own rates. If you sell from a brokerage account in the same year, the real picture is different.
- Itemized deductions and credits. It uses the standard deduction, the 65+ add-on and the senior deduction, nothing else.
- Head of household and married filing separately. Only single and married filing jointly.
- Medicare IRMAA premiums, which also rise with income, two years later. The IRMAA calculator covers those.
- Anything about future years: RMDs, next year’s brackets, or whether you should take more this year so less comes out later.
That last item is the one that actually matters, and it’s not a one-year problem.
From one year to the whole drawdown
The “room left in your bracket” number is the core of most retirement tax planning. Fill it in low-income years, with withdrawals or Roth conversions, and less is left to come out later at a higher rate when RMDs start. One year at a time, that’s arithmetic. Across thirty years it isn’t, because how much you take from the IRA, the brokerage and the Roth each year depends on every other year. I learned that the slow way, running my own optimizer 34 times to see how full to fill each tax bracket (the short answer: to an edge, never the middle, and which edge depends on the rate that money would pay later).
The Roth conversion calculator solves that as one optimization problem. It chooses the withdrawal order and the conversion amount every year to leave you the most after tax, on the same 2026 federal brackets. And if the question is how much you can spend rather than what it costs in tax, I wrote about a withdrawal rate calculator that draws down to zero.
For one year, though, start with the retirement withdrawal tax calculator. Look at the tax on the next $1,000 before you look at anything else.
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