In Reno, Nevada, 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 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 Nevada.
While the federal government levies an income tax against every person and corporation in the U.S., the income taxes imposed by the states vary widely. Some states have relatively high income taxes, and a few have none at all. You should consult with a Reno, Nevada tax Attorney if you don't know what type of tax system your state has.
Income Tax Deductions in Reno, Nevada
A tax deduction is an expense which, in whole or in part, is subtracted from a person's taxable income. For example, if you make ,000 in a year, and the tax rate is 10%, a deduction of ,000 results in only ,000 being taxed. This means that you will pay ,900 instead of ,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.
Many common expenses in Reno can be deducted, in whole or in part, from your taxable income. Federal tax deductions include charitable donations, union dues, interest paid on a mortgage, and state and local taxes.
How Can A Reno, Nevada Tax Attorney Help?
Income tax laws can get pretty complex. If you are in Reno, Nevada 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.