The marginal tax rate is the rate you pay on an additional dollar of income. This is the same rate as your tax bracket.
The effective tax rate is your average tax rate or the percentage of your taxable income that you’ll pay in taxes. In other words, the share of your total annual income you’ll need to pay in taxes.
Average Tax Rate = Total Tax Paid / Taxable Income
This is the more accurate representation of how much you pay in taxes.
This graphic from Nerd Wallet illustrates the point clearly.
With an income of 50k, your total tax bill is $6800, which is 14% of your income.
Hence your effective tax rate is 14%, while your marginal tax rate is 22%.