In Monroe, 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 has the authority 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 North Carolina were allowed to impose income taxes of their own.
While the federal income tax applies to everyone in the United States, the income taxes imposed by individual states vary widely, and some states have no income tax at all. You should consult with a Monroe, North Carolina tax Lawyer or accountant to find out if your state is one of them.
Income Tax Deductions in Monroe, North Carolina
A tax deduction is a reduction in one's taxable income. For example, if a person makes ,000 per year, and receives a ,000 tax deduction, they will only have to pay taxes on the remaining ,000.
This should not be conflated with a tax credit, which is a reduction in your tax bill. A tax credit usually results in a greater reduction in tax liability than a reduction in the same amount.
Many common expenses in Monroe 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 Monroe, North Carolina Tax Attorney Help?
Income tax laws in Monroe, North Carolina can get very complex. You should speak with an accountant or tax Attorney if you have any questions about your income tax liability.