Household
Second income calculator
A second salary is taxed on top of the first. So it keeps far less per dollar than it looks.
When a second earner takes a job, that income does not start at the 0% bracket, it stacks on top of the first income and is taxed at the household's marginal rate. Then childcare, commuting and work costs come out. What is left is often a surprisingly small fraction of the salary. This shows the real keep-rate.
Daycare, after-school, the big one.
Enter both incomes and the costs of the second job.
Worked example, a $40,000 second job
A household with $90,000 of first income adds a $40,000 second salary that needs $12,000 of childcare and $3,000 of commuting:
| Line | Amount |
|---|---|
| Second salary | $40,000 |
| FICA (7.65%) | − $3,060 |
| Federal tax (marginal) | − $4,800 |
| State tax | − $1,100 |
| Childcare + work costs | − $15,000 |
| Actually kept | $16,040 |
| Keep-rate | 40.1% |
Of the $40,000 salary, the household keeps just $16,040, a 40.1% keep-rate, because the income is taxed at the marginal rate and childcare eats much of the rest. This is the number to weigh, not the gross salary. It also leaves out the long-term career value of staying employed and any dependent-care credit, both of which push the other way.
Questions
Why does a second income keep so little?
Because it is taxed from the top, not the bottom. The first income already used up the low brackets, so every dollar of the second is taxed at the household's highest rate, plus 7.65% FICA. Childcare needed to work the second job then comes straight off the top.
Does childcare cost really change the decision?
Often it is the decision. Full-time childcare for young children can cost $12,000-$24,000 a child, and it is paid with after-tax dollars. For a modest second salary, childcare plus marginal tax can leave almost nothing, which is why some families find the second job barely breaks even while children are young.
What is this leaving out?
Two things that favor working: the child-and-dependent-care credit and a dependent-care FSA can offset some childcare cost, and staying in the workforce protects future earnings, raises and retirement contributions. Weigh those against the low short-term keep-rate.
Would filing separately help?
Almost never. Married filing separately usually raises the combined tax and disallows credits like the dependent-care credit and the earned income credit. The second income is taxed at the marginal rate either way; separate filing does not carve it out at low brackets.
Related tools
- Marriage tax calculator two incomes, joint vs single
- Child & dependent care credit
- Paycheck calculator the second salary's take-home
Estimate for the 2026 tax year, married filing jointly. Excludes the dependent-care credit and the long-term value of working. Not financial advice.