The US tax system is setup on both the federal and the state level. There are several taxes which the people of US have to face they are income tax, capital gains, sales tax. The federal tax and the state tax are two different taxation systems, where the state tax has other divisions too under the various states payment system.
Each state has its own taxation system which is different from the other states and the state does not interferes in the taxation matters of the other states and the government too does not interfere in the state affairs.
Taxes are imposed on the net incomes of the individuals and the corporations by the federals and most of the state and some local governments. Citizens and the …show more content…
School and the other properties of the authorities are separately governed under various different taxation systems. Property tax is generally imposed on the property and the other business properties under different heads.
Property tax rules and the rates generally keeping on varying on the yearly basis ranging between 0.2% to 1.9% of the property’s value as per the state 's rules and regulations of taxation system.
The sales tax is charged by the state and the other locals on the amount of sale of goods and services rendered to the customers. Sales tax rates vary widely ranging from 0% to 16%, and may vary within a jurisdiction on the various goods and services. The sales tax is collected by the seller at the time of sales from the customers and is then paid to the taxation authorities at the time of making the tax payment.
The sales tax is even levied or charged on the goods and services being imported from the other countries, and the payment of this tax needs to be paid before they are legally imported. The rates of tariff or the duties vary from 0% to more than 20% depending upon the country of the origin. The sales tax is a state tax which is charged from the customer and varies from the state to state.
ESTATE AND THE GIFT …show more content…
The taxation system for the individuals and the businesses is different as the incomes generated from the sole proprietorship business is charged as the personal income of the individual, the income being generated from the partnership form of a business is also charged as the personal income of the individual partner, as the tax is levied down on the partner’s income and not on the partnership. Partnerships are required to file a return, but it is just an informational return.
Corporations are a separate legal entity and are charged different tax rate from the personal tax rates. Corporate taxation is subject to a double taxation system, which means that the corporations pay their taxes on the earnings and then what is left after the payment of taxes is then distributed as dividends to the stakeholders and then the taxes are charged on the capital gains.
The taxation system is quite interesting if understood by the individuals and needs to be followed to get proper benefits from the government. It is always better to be on a safer side and abide by the taxation