Income Tax Lawyers in Globe, Arizona
In Globe, Arizona, an income tax is imposed on a certain percentage of the income of all individuals and businesses. Generally, income from all sources can be taxed. The federal government has the power 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 Arizona were free to impose income taxes of their own.
The federal income tax must be paid by everybody in the U.S. However, you must only pay the state income tax of the state you live in. You should talk with a financial adviser or tax attorney in Globe, Arizona if you are not clear about what your state and federal tax liability.
There are many rumors floating about which claim that you don't actually have to pay a federal income tax. These "tax protestors" rely on the false notion that the income tax is unconstitutional, or otherwise invalid. This is based on some fairly bizarre interpretations of the constitution and tax code, and suffice it to say, none of them have had much legal success. You should know that if you don't pay your federal taxes in Globe, Arizona, you will face criminal charges.
Income Tax Deductions in Globe, Arizona
A tax deduction is a reduction in the portion of a person's income that is taxable, resulting in a lower tax liability. For example, suppose your income tax rate is 10%, and you had $50,000 in income last year. If you got a $1,000 tax deduction, your taxable income would be $49,000, and you would have to pay 10% on that. So, it would reduce your tax liability from $5000 to $4900.
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 lower tax burden than a tax deduction of the same amount.
Many common expenses in Globe can be deducted from your taxable income. They include mortgage interest, charitable donations (if property documented, of course), the cost of tax advice, union dues, and many others.
If your state imposes an income tax, some or all of these expenses might be deductible, as well. However, this will depend on the law of Arizona
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How Can A Globe, Arizona Tax Attorney Help?
Income tax laws can get quite complex, especially when large amounts of money from multiple sources are involved. It would not be a bad idea to call a Globe, Arizona tax attorney to avoid the consequences of under-paying, and to prevent you from over-paying.