Tax as determined by the taxpayer may be adjusted by the taxing jurisdiction. April 15 following the tax year is the deadline for individuals to file tax returns for federal and many state and local returns. Due dates and other administrative procedures vary by jurisdiction. Taxes are determined separately by each jurisdiction imposing tax. Advance payments of tax are required in the form of withholding tax or estimated tax payments. Taxpayers generally must self assess income tax by filing tax returns. Capital gains are currently taxable at a lower rate than wages, and capital losses reduce taxable income to the extent of gains. " Payroll taxes" are only levied on wages, and usually refer to FICA taxes that fund Social Security and Medicare. "Income taxes" are levied on wages as well as capital gains, and go to federal and state government general funds. Some deductions are subject to limits, and an Alternative Minimum Tax (AMT) applies at the federal and some state levels. Individuals may deduct certain personal expenses, including home mortgage interest, state taxes, contributions to charity, and some other items. Several types of credits reduce tax, and some types of credits may exceed tax before credits. Residents and citizens are taxed on worldwide income, while nonresidents are taxed only on income within the jurisdiction. Partnerships are not taxed (with some exceptions in the case of federal income taxation), but their partners are taxed on their shares of partnership income. Individuals and corporations are directly taxable, and estates and trusts may be taxable on undistributed income. They are determined by applying a tax rate, which may increase as income increases, to taxable income, which is the total income less allowable deductions. The United States federal government and most state governments impose an income tax.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |