In 2001, the tax laws were changed to lower the tax rates across the board and create a new 10 percent income rate. The tax rates are lowered further under the Jobs and Growth Tax Relief Reconciliation Act of 2003, which accelerates to 2003 rate reductions that were otherwise to take effect in 2006.

For tax years 2003 through 2010, the tax rates are set at 10, 15, 25, 28, 33, and 35 percent.

Each succeeding rate applies to a tier of your income. For example, a certain amount of your initial income is taxed at 10 percent, then a certain amount of income above that is taxed at the 15 percent rate, and so on.

Although the six rates are the same for everyone, the dollar levels at which the different tax rates kick in depend on your "filing status" - that is, whether you file your tax return as a single individual, as a head of household, or as married filing jointly or separately. For almost any given income level, the IRS tax tables provide four different amounts of tax that will apply, depending on filing status.

Your filing status is the first item you need to complete on your tax return, after your name, address, and Social Security number. This is appropriate, because your filing status is the starting point for determining whether you need to file a tax return at all, and, if you must file a return, the tax rates that will apply to your income.

Your status also has a wide-ranging effect in determining how numerous other tax rules will apply to you including the standard deduction, IRA contribution limits, credits for children or for education expenses, taxation of Social Security benefits, credits for the elderly or disabled, the adoption credit, the earned income credit and the phaseouts of exemptions and deductions for high-income taxpayers.

Once you've determined your filing status, you need to know how many personal exemptions you can claim, since the law allows you to exempt $3,300 of your income from tax for each member of your family in 2006.

The rules are fairly straightforward for most people. You can claim one exemption for yourself, one for your spouse if married and filing jointly, and one for each minor child living with you. But suprisingly complex rules apply to your older children, parents, extended family members you support, or children from a previous marriage.

For more information, check out any of the following:

• choosing your filing status
• who must file a return
• which tax form should be used
• exemptions and the dependency test
• filing returns for the deceased