In Gas City, Indiana, income tax is imposed on most sources of income that a person receives in a certain year. Under federal, state, and most local laws income from all sources may be taxed. The federal government imposes an income tax on all persons and entities present in the United States. The authority to tax incomes was granted to the federal government in 1913 with the ratification of the 16th Amendment to the Constitution. Before that time, the Supreme Court had found a federal income tax unconstitutional, prompting the passage of the amendment. Of course, individual states, including Indiana, were allowed to impose income taxes as they saw fit.
Everyone in the United States must pay the federal income tax. However, you only have to pay the state income tax of the state in which you reside. You should speak with an accountant or tax lawyer in Gas City, Indiana if you aren't clear about what system your state has.
Income Tax Deductions in Gas City, Indiana
A tax deduction is a reduction in your taxable income. It results in less of one's income being taxable, which causes a reduced tax liability.
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.
Lots of expenses that are common in Gas City are tax deductible. Federal tax deductions include mortgage interest, union dues, interest paid on mortgages, and others.
How Can A Gas City, Indiana Tax Attorney Help?
Income tax law can get fairly complex in Gas City, Indiana. If you have any questions about your income tax liability, you should not hesitate to speak with a tax lawyer sooner, rather than later.