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Different Types Of Taxes To Pay
Taxes are paid when one is working or buying any item. The government operates on tax on social security benefits provided by the citizens to be functional. The US government collects trillions of dollars in federal taxes. When you include any other type of tax is the total income becomes much more. Keep reading to know more about the different forms of taxes that you are should plan to pay.
Income tax is what many people who are working are familiar with. You need to file for tax returns which is a requirement set by the government. When you pay such taxes you will qualify for a refund where necessary. It is possible to get more than you expected from your taxes when you understand the tax credits and deductions that you should qualify for. Income taxes exist in different types like the FICA, payroll, local, state and federal taxes. The percentages are not the same depending on the state you currently live in.
Another form of tax is the capital gain taxes which means that anytime you want to sell an asset it is a requirement for you to pay taxes. The main determinant will be the amount of time you have had ownership of the assets. You will be required to pay short-term rates if you have had the property for less than a year. Consider long term capital gain taxes if you have owned the assets for many years.
Investment taxes for those who enjoy trading stocks and bonds. Before investing you will fill out a form that shows you have ordinary income and qualified to do investment.
There is also have property taxes which is calculated based on the value of the land and home. Your state will determine what percentage will be paying yearly. The money is budgeted for local issues that occur in your area like sewage drainage, road maintenance, schools and other things. Estate tax is meant to be paid by whoever will inherit your assets when you are no longer there.
Inheritance and wealth tax is transferred also to another person upon your demise. The tax is usually charged depending on the amount inherited and is applicable in about six states only. You are required to pay goods and services tax when you go and buy goods or services.
Additionally, there is the sales tax that is charged on any item no purchase at the point of sale. Value added tax is much more similar like that are only that they are added at the final sale. Each person pays taxes every year. Knowing what to pay will help you plan your finances better.