Income Tax Lawyers in Childersburg, Alabama
In Childersburg, 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 Childersburg, Alabama if you don't know what the tax system is here.
You might have heard rumors claiming that you don't really have to pay your federal income tax. These rumors are false. "Tax protesters" rely on bizarre and discredited legal arguments in their claims that the federal income tax is somehow illegal. None of these arguments have ever been successful in U.S. Courts, and deliberately refusing to pay your income tax in Childersburg, Alabama is a good way to end up in federal prison.
Income Tax Deductions in Childersburg, Alabama
A tax deduction is an expense which, in whole or in part, is subtracted from a person's taxable income. For example, if you make $50,000 in a year, and the tax rate is 10%, a reduction of $1,000 results in only $49,000 being taxed. This means that you will pay $4,900 instead of $5,000.
This should not be confused with a tax credit, which is a reduction of a person's tax bill. A tax credit almost always results in a reduced tax burden than a tax reduction of the same amount.
Many common expenses in Childersburg can be deducted, in whole or in part, from your taxable income. Federal tax deductions include charitable contributions, union dues, interest paid on a mortgage, and state and local taxes.
If one's state has an income tax, it likely has many of the same deductions, though they could vary widely. This will depend on the particular laws of Alabama.
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How Can A Childersburg, Alabama Tax Attorney Help?
Income tax laws can get quite complex, particularly when large amounts of money from multiple sources are involved. It would not be a bad idea to call a Childersburg, Alabama tax lawyer to avoid the consequences of under-paying, and to prevent you from over-paying.