Income Tax Lawyers in Fort Payne, Alabama
In Fort Payne, Alabama, an income tax is imposed on a certain percentage of the income of all individuals and businesses. Generally, income from all sources may be taxed. The federal government has the authority to impose an income tax thanks to the 16th Amendment to the U.S. Constitution, enacted in 1916 after the Supreme Court had, on more than one occasion, found a federal income tax to be unconstitutional. Of course, before and after the creation of the federal income tax, states, including Alabama were allowed to impose income taxes of their own.
Everyone in the U.S. is subject to the federal income tax. But you are only subject to the income tax of the state in which you live. Some states have no income tax at all. You should speak with an accountant or tax lawyer in Fort Payne, Alabama if you don't know what the tax system is here.
For years, rumors have circulated that the federal income tax is illegal or unconstitutional. These rumors are false: the federal government has explicit constitutional power to tax income under the 16th Amendment. Still, "tax protesters" employ some fringe constitutional arguments, none of which have been successful. In Fort Payne, Alabama, refusing to pay your income tax can, and likely will, result in criminal prosecution.
Income Tax Deductions in Fort Payne, Alabama
A tax deduction is simply a reduction in the part of a person's income that is taxable. For example, if someone makes $50,000 per year, and gets a $1,000 tax deduction, their taxable income is $49,000.
This should not be confused with a tax credit, which is simply a reduction in somebody's tax bill. A tax credit will usually reduce your tax liability far more than a tax reduction of the same amount.
Many expenses in Fort Payne are tax-deductible, such as interest paid on mortgages, charitable contributions, the cost of tax advice, and union dues, among others.
If one's state has an income tax, some or all of these expenses may be deductible from your state income tax. The exact nature and extent of any deductions will depend on the laws of Alabama.
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How Can A Fort Payne, Alabama Tax Attorney Help?
Income tax law can get fairly complex in Fort Payne, Alabama. If you have any questions about your income tax liability, you should not hesitate to speak with a tax lawyer sooner, rather than later.