In New London, New Hampshire, the income tax is a tax imposed on money received (income) during a certain set time period. Under federal law, and the laws of most states, income from any source can be taxed. The federal government has the power 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 New Hampshire were free to impose income taxes of their own.
The federal income tax must be paid by everybody 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 attorney in New London, New Hampshire if you are not clear about what your state and federal tax liability.
Income Tax Deductions in New London, New Hampshire
A tax deduction is simply a reduction in the portion of a person's income which is taxable. For example, if someone makes ,000 per year, and gets a ,000 tax deduction, their taxable income is ,000.
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.
Lots of expenses that are common in New London are tax deductible. Federal tax deductions include mortgage interest, union dues, interest paid on mortgages, and others.
How Can A New London, New Hampshire Tax Attorney Help?
Income tax laws can get pretty complex. If you are in New London, New Hampshire 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.