In Lighthouse Point, Florida, an income tax is imposed on a certain percentage of the income of all individuals and businesses. Typically, 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 Florida.
Everybody 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 reside. Some states have no income tax at all. You should speak with an accountant or tax Attorney in Lighthouse Point, Florida if you don't know what the tax system is here.
Income Tax Deductions in Lighthouse Point, Florida
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 ,000 in income last year. If you got a ,000 tax deduction, your taxable income would be ,000, and you would have to pay 10% on that. So, it would reduce your tax liability from to .
This should not be conflated with a tax credit, which is a reduction in one's tax bill. A tax credit normally results in a greater reduction in tax liability than a deduction in the same amount.
Lots of expenses that are common in Lighthouse Point are tax deductible. Federal tax deductions include mortgage interest, union dues, interest paid on mortgages, and others.
How Can A Lighthouse Point, Florida Tax Attorney Help?
Income tax laws can get pretty complex. If you are in Lighthouse Point, Florida and have any questions about your taxes, you should consult with an accountant or local tax Attorney to avoid tax problems, such as audit or wage garnishment.