In New Milford, Connecticut, an income tax is imposed on a certain percentage of the income of all individuals and businesses. Usually, income from all sources can be taxed. The federal government has had the constitutional power to impose an income tax since 1916, since the passage of the 16th Amendment. Before then, states could, and still can, impose whatever income tax they like, including in Connecticut.
While the federal government levies an income tax against every person and corporation in the U.S., the income taxes imposed by the states vary widely. Some states have relatively high income taxes, and a few have none at all. You should consult with a New Milford, Connecticut tax Attorney if you don't know what type of tax system your state has.
Income Tax Deductions in New Milford, Connecticut
A tax deduction is a reduction in one's taxable income. It results in less of your income being taxable, which causes a lower tax liability.
There is also something called a tax credit, which is treated as a partial payment of the income tax. A tax credit almost always results in a lower tax bill than a deduction of the same amount.
Under federal law, many expenses in New Milford are tax-deductible, including interest paid on a mortgage, charitable contributions, the cost of tax advice, and union or professional dues, among many others.
How Can A New Milford, Connecticut Tax Attorney Help?
Income tax laws in New Milford, Connecticut can get fairly complex. You should speak with an accountant or tax Lawyer if you have any questions about your income tax liability.