The income tax in Aberdeen, South Dakota 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 had explicit constitutional authority to impose an income tax since 1916, with the passage of the 16th Amendment. This came after the Supreme Court had consistently found a federal income tax to be unconstitutional. States, including South Dakota, have always been allowed to impose whatever type of income tax they liked.
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 an Aberdeen, South Dakota tax lawyer or accountant to find out if your state is one of them.
Income Tax Deductions in Aberdeen, South Dakota
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 Aberdeen 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 Aberdeen, South Dakota Tax Attorney Help?
Income tax laws in Aberdeen, South Dakota can get very complex. You should speak with an accountant or tax attorney if you have any questions about your income tax liability.