In Farmville, North Carolina, the income tax is a tax imposed on money received (income) during a given set time period. Under federal law, and the laws of most states, income from any source 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 North Carolina, were allowed to impose income taxes as they saw fit.

The federal income tax must be paid by everyone 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 lawyer in Farmville, North Carolina if you are not clear about what your state and federal tax liability.

Income Tax Deductions in Farmville, North Carolina

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.

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 reduced tax bill than a reduction of the same amount.

Many common expenses in Farmville 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.

How Can A Farmville, North Carolina 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 Farmville, North Carolina tax lawyer to avoid the consequences of under-paying, and to prevent you from over-paying.