Tax Bracket
Also called: tax brackets, income tax bands, tax rate bands
A tax bracket is a band of income taxed at a particular rate. The persistent myth is that entering a higher bracket taxes all your income at the higher rate — it doesn't. Only the dollars inside each band are taxed at that band's rate, so a raise can never leave you worse off through brackets alone. What can create a genuine cliff is a benefit or credit that phases out abruptly at an income threshold.