The income tax in South Williamsport, Pennsylvania is a tax imposed on all money earned and received during the year. Under federal law, income through 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 Pennsylvania were allowed to impose income taxes of their own.
Everyone in the U.S. is subject to the federal income tax. But you are only subject to the income tax of the state in which you live. Some states have no income tax at all. You should speak with an accountant or tax Lawyer in South Williamsport, Pennsylvania if you don't know what the tax system is here.
Income Tax Deductions in South Williamsport, Pennsylvania
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 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.
Many common expenses in South Williamsport 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 South Williamsport, Pennsylvania 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 South Williamsport, Pennsylvania tax Lawyer to avoid the consequences of under-paying, and to prevent you from over-paying.