The Taxes You May Need To Pay – Smb Suggestions

The Taxes You May Need To Pay

  1. Individual Income Tax

Individual income tax is one of the big heads of US taxation. It is divided into federal income tax according to the level of collection. Federal Income Tax, State Income Tax, and Local Income Tax, which is mainly Federal Income Tax.

Federal individual income tax is within the scope of Federal Tax. The common federal tax also includes the Medicare Tax and the Social Security Tax.

Seven states in the United States don’t impose income taxes: Alaska, Florida, Nevada, South Dakota, Texas, Washington, and Wyoming.

As long as you have earned income, you need to pay the tax; this includes students with F-1 visas who receive scholarships.

  1. Corporate Income Tax

Corporate income tax is the third-largest tax revenue of the federal government following the federal income tax and the social security tax (the overall amount is declining).

Corporate income tax is also collected at the federal and state level.

Corporate income tax is levied on domestic corporations and foreign corporations, and the legal persons in the country refer to corporations incorporated in the United States under the laws of the United States federal government and state laws, except for foreign corporations.

As a company incorporated in the United States, whether its legal person is working in the United States or whether the company is established in the United States, the company’s legal person is considered a domestic legal person.

Domestic corporations pay taxes on income worldwide, while foreign corporations pay tax on the company’s trade and operations in the United States. A company established outside the United States with a foreign legal person also pays taxes, as long as it has a taxable business in the United States.

The scope of corporate income tax includes, but is not limited to, the company’s operating income, capital gains, dividends, rent, royalties, labor income, etc.

  1. FICA Tax

The FICA tax consists of a social security tax and a health care tax, collected by the US federal government as a source of funds for old age, survivors, disability, and medical insurance, including federal insurance tax, railway company retirement tax, federal unemployment tax, individual owner tax, etc. Employers and employees are taxpayers, and self-employed operators are also expropriators.

The tax base for employees is the total annual salary, including bonuses, handling fees, in-kind wages, etc. The tax base for employers is the sum of their employees’ wages. The proportional tax rate is not levied on wages above the prescribed maximum.

  1. Property Tax

Property tax is imposed by the US state and local governments on natural and legal persons who own real estate or movable property, especially real estate in the US.

Property tax accounts for over 80% of local government tax revenue. The federal government does not impose property taxes. States have independent legislative powers over state taxes such as property taxes, so the regulations vary from state to state.

In general, states in the US divide property into movable, immovable, and intangible assets. Real estate includes permanent buildings and structures on land and the land itself; movable property is any tangible property other than immovable property, such as aircraft, vehicles, boats, etc.; intangible property refers to intangible financial assets, such as in the stock market and bond investment.

Property taxes are imposed on real estate in all states, and most states impose taxes on movable property. In addition, the law stipulates that property taxes at all levels of government, as well as property owned by religions, charities, and educational institutions, are exempt from property taxes. Many governments stipulate property tax reductions for the elderly.

  1. Estate and Gift Tax

The US federal estate tax applies to the transfer of property when a citizen dies. The federal estate tax is based on the total estate tax system, and the taxpayer is the executor of the will. The uniform credit means that the tax law allows each taxpayer to deduct a certain amount of credit from the amount of the estate tax.

The gift tax is the total amount of the gifted property as the tax amount, and the taxpayer is the property giver. In 1976, the tax legislation merged the two to be unified, and the same progressive tax rate table and unified credit amount were applied to the property transfer of the deceased before and after the death. Although an inheritance tax is imposed on an individual’s assets and estates after death, the grant tax paid during the taxpayer’s residence is subject to a gift tax. A gift tax prevents individuals with large estates from handing over all their assets to their heirs during their lifetime to avoid estate taxes.

  1. Consumption Tax and Excise Duty

Consumption tax is an indirect tax on the sale of a particular good or service (such as fuel, tobacco, and alcohol), meaning that taxes are not paid directly by individual consumers. Instead, the US Internal Revenue Service (IRS) taxes producers or merchants and passes them on to consumers by including them in the price of the product.

Featured image: DepositPhotos – VadimVasenin

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