Yes it is based on salary, the tax liability calculation is something like this: gross income-deductions=adjusted gross income-deductions-exemptions=tax liability(less any credits you have). that is summarized, but you can get deductions from your taxable income for having a home and for being in school and for having a business. these things lower the number they use to figure out how much tax you will owe if any. so for example, say you made 100,000 dollars gross income and you have some business expenses that qualify, you would be able to subtract those and the number they use to multiply against the tax rates goes down. Let's say you have a 25 percent tax rate, and your expenses were 50,000. Without the expenses, you would multiply 25 percent times 100,000, and owe 25,000 in taxes. With the expenses deducted, you would multiply 25 percent and then owe much less. But this is all oversimplified. Use the calculator like i said and if you really have questions about lowering it, then go to a cpa.
