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An income tax is a tax imposed on individuals or entities (taxpayers) in respect of the income or profits earned by them (commonly called taxable income). Income tax generally is computed as the product of a tax rate times the taxable income. Taxation rates may vary by type or characteristics of the taxpayer and the type of income.
Individual income taxes (purple), payroll taxes/FICA (azure), corporate income taxes (green), excise taxes (orange), estate and gift taxes (yellow), other receipts (blue). [ 12 ] Adjustments (usually reductions) to gross income of individuals are made for contributions to many types of retirement or health savings plans, certain student loan ...
Personal income tax is a tax levied on income earned by individuals, and its rates are adjusted according to the jurisdiction of each country. It serves as a significant source of revenue for the government, which is then utilized for funding public goods and services.
For example, personal income taxes help fund Social Security, schools and roads. Types of income tax. Individual income tax, also called personal income tax, is placed on a person's wages, salary ...
Tax collectors would literally go door to door and ask if the individual had income during the year. If so, the tax was computed on the spot. The income tax raised little revenue, and was viewed as a supplement to more traditional forms of property taxation. [5]
Personal income also includes income received by nonprofit institutions serving households, by private non-insured welfare funds, and by private trust funds. BEA also publishes disposable personal income, which measures the income available to households after paying federal and state and local government income taxes.
For 2009, the personal income tax exemption amount is $3,650. That's per person, not per family. That amount applies so long as your adjusted gross income (AGI) falls under the phaseout amount.
One of the most impactful proposed tax cuts is the elimination of personal income taxes. Here’s a look at some data to see the impact of the possible elimination of income taxes.