Different Types of Taxes in United States
The U.S. tax system is complex, with various types of taxes levied at the federal, state, and local levels. These taxes serve to fund government operations, infrastructure, public services, and social programs. Below is an overview of the different types of taxes that U.S. citizens encounter: Income Taxes Federal Income Tax : The U.S. federal government imposes a tax on individual income, which is the largest source of revenue for the government. Income taxes are progressive, meaning that the more you earn, the higher your tax rate. The Internal Revenue Service (IRS) is the agency responsible for collecting these taxes. Tax Rates : The tax rates vary by income bracket. As of recent years, there are seven income tax brackets ranging from 10% to 37%. The amount of tax you owe depends on your taxable income after deductions and exemptions. State Income Tax : Many U.S. states also levy their own income taxes. State income tax rates can vary widely. Some states, like Florida and Tex...