query: how many us states have no income tax

pos: State income tax limits on certain deductions, especially depreciation of business assets. Most of the states allow non-business deductions in a manner similar to federal rules. Few allow a deduction for state income taxes, though some states allow a deduction for local income taxes. Six of the states allow a full or partial deduction for federal income tax. In addition, some states allow cities and/or counties to impose income taxes. For example, most Ohio cities and towns impose an income tax on individuals and corporations. By contrast, in New York, only New York City and Yonkers impose a municipal income tax. Nine U.S.

pos: Political debates about the United States federal budget Warren Buffett has argued that taxes have little to do with job creation, writing in August 2011: "And to those who argue that higher rates hurt job creation, I would note that a net of nearly 40 million jobs were added between 1980 and 2000. You know what's happened since then: lower tax rates and far lower job creation." From 2002 to 2011, the nine US states with the highest income taxes grew their economy 8.2%, all states with an income tax grew 6.3%, and the nine states without an income tax grew 5.2%. A more specific, frequently debated, proposal

neg: Offshore bank tax laws of many countries (e.g., France, Malaysia, and the United States) make no distinction between interest earned in local banks and that earned abroad. Persons subject to US income tax, for example, are required to declare, on penalty of perjury, any foreign bank accounts—which may or may not be numbered bank accounts—they may have. Although offshore banks may decide not to report income to other tax authorities and have no legal obligation to do so, as they are protected by bank secrecy, this does not make the non-declaration of the income by the taxpayer or the evasion of the

neg: Brushaber v. Union Pacific Railroad Co. be apportioned among the states. No income tax enacted by the US Congress (either before or after the Sixteenth Amendment) has ever been apportioned among the states by population. All income taxes enacted after the Amendment have been treated as excises (they have been imposed with geographic uniformity but have not been required to be apportioned). Since the income tax may be imposed on income from whatever source and without regard to any apportionment requirement (by virtue of the wording of the 16th Amendment), an income tax cannot be treated as a direct tax (as income taxes on income from

neg: Employee stock ownership plan States sanctioned an income tax on all citizens, one of the biggest debates was about how to treat stock set aside for an employee by his employer under the new US income tax laws. ESOPs were developed as a way to encourage capital expansion and economic equality. Many of the early proponents of ESOPs believed that capitalism's viability depended upon continued growth and that there was no better way for economies to grow than by distributing the benefits of that growth to the workforce. In 1956, Louis Kelso invented the first ESOP, which allowed the employees of "Peninsula Newspapers" to

neg: Franchise tax sales or otherwise derives an economic benefit from activities within their borders. About half the U.S. states do not impose a franchise tax. For states that have a franchise tax, the amount is often either a flat fee or based on the size of the business's total holdings. States with higher corporate income taxes usually have low or no franchise taxes and vice versa. The state of Delaware has a significant franchise tax. Other states have either nominal taxes or none at all. Franchise tax A franchise tax is a government levy (tax) charged by some US states to certain

neg: Shell corporation As the shell company is not based in the United States, its profit is not subject to US income tax, and as it is an offshore company in the tax haven jurisdiction, it is not taxed there either. Under the tax haven law, the profits are deemed not to have been made in the jurisdiction, with the sale deemed to have taken place in the United States. As US personal income tax is significantly less important than corporate income tax, US company executives would claim a salary (or fees, consulting fees, etc.) from the company's profits. In addition, there are

neg: Property tax in the United States or income tax is that the revenue always equals the tax levy, unlike the other taxes. The property tax typically produces the required revenue for municipalities' tax levies. A disadvantage to the taxpayer is that the tax liability is fixed, while the taxpayer's income is not. The tax is administered at the local government level. Many states impose limits on how local jurisdictions may tax property. Because many properties are subject to tax by more than one local jurisdiction, some states provide a method by which values are made uniform among such jurisdictions. Property tax is rarely self-computed by the

neg: State income tax for federal income tax purposes. For example, many states do not allow the additional first year depreciation deduction. Most states tax capital gain and dividend income in the same manner as other investment income. In this respect, individuals and corporations not resident in the state generally are not required to pay any income tax to that state with respect to such income. Some states have alternative measures of tax. These include analogs to the federal Alternative Minimum Tax in 14 states, as well as measures for corporations not based on income, such as capital stock taxes imposed by many states.

neg: Income tax in the United States tax policies of the mid-1980s were the least progressive period since 1979. Government transfer payments contributed more to reducing inequality than taxes. Other Federal taxation: US State taxes: Politics: General: Government sources: Law & regulations: Texts: Monographs: Reference works (annual): Consumer publications (annual): Income tax in the United States Income taxes in the United States are imposed by the federal, most state, and many local governments. The income taxes are determined by applying a tax rate, which may increase as income increases, to taxable income, which is the total income less allowable deductions. Income is broadly defined. Individuals and corporations

neg: Income tax than 10% of households would pay any. The purpose of the income tax was to make up for revenue that would be lost by tariff reductions. The US Supreme Court ruled the income tax unconstitutional, the 10th amendment forbidding any powers not expressed in the US Constitution, and there being no power to impose any other than a direct tax by apportionment. In 1913, the Sixteenth Amendment to the United States Constitution made the income tax a permanent fixture in the U.S. tax system. In fiscal year 1918, annual internal revenue collections for the first time passed the billion-dollar mark,

neg: State income tax with no income tax, has a state taxing authority with power to examine (audit) and adjust returns filed with it. Most tax authorities have appeals procedures for audits, and all states permit taxpayers to go to court in disputes with the tax authorities. Procedures and deadlines vary widely by state. All states have a statute of limitations prohibiting the state from adjusting taxes beyond a certain period following filing returns. All states have tax collection mechanisms. States with an income tax require employers to withhold state income tax on wages earned within the state. Some states have other withholding mechanisms,

neg: Tax cut and how the government adjusts to its reduced income. Depending on the original tax rate, tax cuts may provide individuals and corporations with an incentive investments which stimulate economic activity. Some politically conservative opinion-makers, such as Art Laffer, have theorized that this could generate so much additional taxable income that a lower tax can generate more revenue than was collected at the higher rate. However, basic math states that cutting tax rates in half would require an economy twice the size to generate the same amount of tax revenue. This claim has been contested by many think tanks and academics

neg: Multiple citizenship being owed, although a US tax return would still have to be filed. In instances where the Australian tax was less than the US tax, and if there was income that could not be exempted from US tax, the US would expect any tax due to be paid. The United States Internal Revenue Service has excluded some regulations such as Alternative Minimum Tax (AMT) from tax treaties that protect double taxation. In its current format even if US citizens are paying income taxes at a rate of 56%, far above the maximum US marginal tax rate, the citizen can be

neg: Basic income in the United States and support for, basic income and the related system negative income tax, rose substantially. This debate and interest was highly linked to general debate on poverty and how to deal with it. In 1968, James Tobin, Paul Samuelson, John Kenneth Galbraith and another 1,200 economists signed a document calling for the US Congress to introduce in that year a system of income guarantees and supplements. Milton Friedman endorsed the negative income tax in 1962 and again in 1980, and he connected his support for the negative income tax to support for basic income in an interview with Eduardo Suplicy in

neg: Tax resistance tax, a resister may reduce their income below the tax threshold by embracing simple living or a freegan lifestyle. For example, UK citizens pay no income tax if their income is below the personal allowance. In the US the equivalent tax-free annual income is the sum of the standard deduction and personal exemption, though many deductions and credits allow people to earn much more than this and still avoid income tax. Opposition to war has led some, such as Ammon Hennacy and Ellen Thomas, to a form of tax resistance in which they reduce their income below the tax threshold

neg: Tax policy and economic inequality in the United States Tax policy and economic inequality in the United States Tax policy and economic inequality in the United States discusses how tax policy affects the distribution of income and wealth in the United States. Income inequality can be measured before- and after-tax; this article focuses on the after-tax aspects. Income tax rates applied to various income levels and tax expenditures (i.e., deductions, exemptions, and preferential rates that modify the outcome of the rate structure) primarily drive how market results are redistributed to impact the after-tax inequality. After-tax inequality has risen in the United States markedly since 1980, following a more egalitarian

neg: Tax the level of taxation but also the pattern of taxation. With the increase of larger tax bases and the diminish of the importance of trading tax, while income tax gains more importance. According to Tilly's argument, state capacity evolves as response to the emergence of war. War is an incentive for states to raise tax and strengthen states capacity. Historically, many taxation breakthroughs took place during the wartime. The introduction of income tax in Britain was due to the Napoleonic War in 1798. US first introduce income tax during Civil War. Taxation is constrained by the fiscal and legal capacities

neg: Income inequality in the United States income exclusions for healthcare insurance premiums paid for by employers and tax deductions for mortgage interest, are distributed unevenly across the income spectrum. They are often what the Congress offers to special interests in exchange for their support. According to a report from the CBO that analyzed the 2013 data: Understanding how each tax expenditure is distributed across the income spectrum can inform policy choices. Economist Dean Baker argues that the existence of tax loopholes, deductions, and credits for the corporate income tax contributes to rising income inequality by permitting large corporations with many accountants to reduce their tax burden

neg: Economy of Texas collected in 2005. Texas is one of the seven states of the United States with no personal state income tax. In addition, Texas does not allow any lower level of government (counties, cities, etc.) to impose an income tax. This means that, for the residents of Texas, the maximum rate of income taxation is the top rate set by the US Government. Businesses, except for sole proprietorships and partnerships, are subject to a gross margins tax. The state sales tax is set at 6.25 percent. Cities are allowed to impose an additional 1% tax, and additional taxes not to exceed

neg: Tax protester arguments therefore be invalid. These protesters claim that without clear definitions, Chapter 1 of Title 26 of the Code of Federal Regulations suggests IRS agents must rely on voluntary compliance. No court has upheld this argument, and many courts have rejected it, and 26 U.S.C. §§ 61-64 "does" define various classes of income ("Gross income", "[a]djusted gross income", "[t]axable income", and "[o]rdinary income defined"). Some tax protesters claim that since the year 1913 (the year of the inception of the modern Federal income tax), several generations of IRS employees, Department of Justice employees, the United States Congress, Federal court judges, lawyers,

neg: Fin 48 Fin 48 FIN 48 (mostly codified at ASC 740-10) is an official interpretation of United States accounting rules that requires businesses to analyze and disclose income tax risks. It was effective in 2007 for publicly traded entities, and is now effective for all entities adhering to US GAAP. A business may recognize an income tax benefit only if it is more likely than not that the benefit will be sustained. The amount of benefit recognized is based on relative probable outcomes. Income for financial statements may differ from taxable income for many valid reasons. U.S. Generally Accepted Accounting Principles have

neg: An Inconvenient Tax An Inconvenient Tax An Inconvenient Tax is a 2010 documentary film produced by Life Is My Movie Entertainment. The film explores the history of the income tax in the United States and the causes of its many complexities. "An Inconvenient Tax" examines the Federal Income Tax and how Congress uses the complex tax code to achieve political goals that are unrelated to raising revenue. The result of 95 years of additions, subtractions, deductions, and exclusions, the 62,000 page tax code is so complex that many are voicing their desire to greatly simplify it or to even completely remove it. Currently,

neg: Involuntary servitude terms "The Cult Of Forced Schooling". Many libertarians consider income taxation a form of involuntary servitude. Republican Congressman Ron Paul has described income tax as "a form of involuntary servitude, and has written, "... things like Selective Service and the income tax make me wonder how serious we really are in defending just basic freedoms. Some have also argued that, should "Roe v. Wade", 410 U.S. 113 (1973), be overturned by the United States Supreme Court, a constitutional right to abortion could still be sustained on the basis that denying it would subject women to involuntary servitude contrary to the

neg: Causes of income inequality in the United States progressive tax is a tax in which the effective tax rate increases as the taxable base amount increases. Overall income tax rates in the U.S. are below the OECD average, and until 2005 have been declining. How much tax policy change over the last thirty years has contributed to income inequality is disputed. In their comprehensive 2011 study of income inequality ("Trends in the Distribution of Household Income Between 1979 and 2007"), the CBO found that, The top fifth of the population saw a 10-percentage-point increase in their share of after-tax income. Most of that growth went to the top

neg: Income trust have taken action to shut down flow-through structures. In his research paper "Digging Deeper" he gives a perspective on how the United States taxes publicly traded flow-through entities and master limited partnerships, the US equivalent of Canadian income trusts. Analyst Dirk Lever wrote on January 15, 2007: "We cannot understand why any Canadians would support double taxation of retirement benefits - it affects all of us eventually." Mr. Lever also looked at the Conservative government's policy in his research paper "Deep Dive into Tax Issues: Canadian Pensioners Taxed Twice on Canadian Corporate Dividends". In the report Mr. Lever questions the

neg: Partnership taxation in the United States Partnership taxation in the United States The rules governing partnership taxation, for purposes of the U.S. Federal income tax, are codified according to Subchapter K of Chapter 1 of the U.S. Internal Revenue Code (Title 26 of the United States Code). Partnerships are "flow-through" entities. Flow-through taxation means that the entity does not pay taxes on its income. Instead, the owners of the entity pay tax on their "distributive share" of the entity's taxable income, even if no funds are distributed by the partnership to the owners. Federal tax law permits the owners of the entity to agree how the

neg: Tuition Assistance Program Because TAP is a grant, the aid does not need to be repaid. There are several determining factors that influence how much aid students receive, such as family income and tax status (independent or dependent). Dependent students qualify for TAP if their family net tax income is below $80,000, and independent students who are married but have no parental income qualify if their income is below $40,000. Single independent students qualify for TAP if they have no parental income and their personal income is below $10,000. Other qualifications include number of college credits and grade point average for individuals who

neg: Basic income around the world big debate in the United States regarding poverty and how to deal with it. One of the solutions that came up during this time was some form of guaranteed income, mostly in the form of a negative income tax but sometimes in the form of basic income. In 1968, James Tobin, Paul Samuelson, John Kenneth Galbraith and another 1,200 economists signed a document calling for the US Congress to introduce in that year a system of income guarantees and supplements. Milton Friedman endorsed the negative income tax in 1962 and again in 1980, and he connected his support for the

neg: Income tax rising to $5.4 billion by 1920. The amount of income collected via income tax has varied dramatically, from 1% in the early days of US income tax to taxation rates of over 90% during WW2. While tax rules vary widely, there are certain basic principles common to most income tax systems. Tax systems in Canada, China, Germany, Singapore, the United Kingdom, and the United States, among others, follow most of the principles outlined below. Some tax systems, such as India, may have significant differences from the principles outlined below. Most references below are examples; see specific articles by jurisdiction ("e.g.",

neg: Multiple citizenship their non-resident citizens on foreign income; examples include the United States and Eritrea. U.S. persons living outside of the United States are still subject to tax on all of their worldwide income, although US law provides measures to reduce or eliminate double taxation issues for some. It has been reported that some US citizens have relinquished US citizenship in order to avoid possible taxes, the expense and complexity of compliance, or because they have been deemed unacceptable to financial institutions in the wake of FATCA. A person with multiple citizenship may have a tax liability to his country of residence

neg: Income tax in the United States is applied. As the name implies, the "last-in-time rule" states that the authority that was issued later in time is controlling. Regulations and case law serve to interpret the statutes. Additionally, various sources of law attempt to do the same thing. Revenue Rulings, for example, serves as an interpretation of how the statutes apply to a very specific set of facts. Treaties serve in an international realm. United States tax law attempts to define a comprehensive system of measuring income in a complex economy. Many provisions defining income or granting or removing benefits require significant definition of terms. Further, many

neg: Share Incentive Plan in the SIP for more than 5 years, there will be no Income Tax or National Insurance liability when the shares are removed from the SIP. In certain circumstances, prescribed by HMRC, there will be no Income Tax or National Insurance liability when the employee leaves the company, no matter how long the shares have been held in the plan. Employees can use their pre-tax salary to buy shares up to a maximum of £1,800 or 10% of salary (whichever is the lower) each year. Partnership Shares will be free of Income Tax and National Insurance at the date of

neg: State income tax State income tax Most individual U.S. states collect a state income tax in addition to federal income tax. The two are separate entities. Some local governments also impose an income tax, often based on state income tax calculations. Forty-three states and many localities in the United States may impose an income tax on individuals. Forty-seven states and many localities impose a tax on the income of corporations. State income tax is imposed at a fixed or graduated rate on taxable income of individuals, corporations, and certain estates and trusts. The rates vary by state. Taxable income conforms closely to federal

neg: State income tax most states is defined, at least in part, by reference to federal taxable income. According to www.taxfoundation.org these states have no state corporate income tax as of Feb 1, 2010: Nevada, Washington, Wyoming, Texas, and South Dakota. However, Texas has a franchise tax based on "taxable margin", generally defined as sales less either cost of goods sold less compensation, with complete exemption (no tax owed) for less than $1MM in annual earnings and gradually increasing to a maximum tax of 1% based on net revenue, where net revenue can be calculated in the most advantageous of four different ways. States

neg: Kiddie tax have earned income that is less than 50 percent of their support. Kiddie tax The kiddie tax rule exists in the United States of America and can be found in Internal Revenue Code § 1(g), which "taxes certain unearned income of a child at the parent's marginal rate, no matter whether the child can be claimed as a dependent on the parent's return". The United States federal income tax system is progressive, meaning, the higher the income the higher percentage of that income is paid to the government in the form of a tax. The progressivity of the income tax

neg: Exchange-traded note gains are treated more favorably than short-term capital gains and interest in the US (> 1 year holdings are taxed at a capital gains rate of 20%). There is no way to avoid paying capital gains tax, but there can be great advantage in wealth building by delaying it. Recent tax rulings have suggested that ETNs may be qualified tax shelters for the purpose of changing current interest income into deferred capital gains income. ETNs give investors a broad-based index without any tracking error to the index, doing away with the discrepancies that exist between the returns of many ETFs

neg: Connecticut the state's income tax, even if earned outside the state. However, in those cases, Connecticut income tax must be withheld only to the extent the Connecticut tax exceeds the amount withheld by the other jurisdiction. Since New York and Massachusetts have higher tax rates than Connecticut, this effectively means that Connecticut residents that work in those states have no Connecticut income tax withheld. Connecticut permits a credit for taxes paid to other jurisdictions, but since residents who work in other states are still subject to Connecticut income taxation, they may owe taxes if the jurisdictional credit does not fully offset

neg: Ferenc Fricsay USA, where he conducted the Boston Symphony Orchestra and San Francisco Symphony. He was appointed musical director of the Houston Symphony in 1954, but resigned halfway through the season over "disagreements on musical policy." The true reason involved US tax policy. He discovered that under the Internal Revenue Code he would have to declare income earned throughout the world in his US tax return as long as he spent more than 6 months residing in the United States. His contract with the Houston Symphony would have resulted in having his income becoming subject to prohibitive US tax rates. When he

neg: Constitutional basis of taxation in Australia "States Grants (Income Tax Reimbursement) Act 1942". The first act purported to impose Commonwealth income tax. The latter act said Commonwealth funding would be provided to the States only if they imposed no income tax. This latter act was premised on section 96. Since 1942 no state has imposed income taxes; instead the states have largely relied on section 96 grants. Section 90 gives the Commonwealth the exclusive, as opposed to concurrent with the States, power to impose "duties of customs and of excise". Any state taxing law which can be characterized as a duty of customs or excise is

neg: Income tax in the United States and qualified dividends may be taxed as part of taxable income. However, the tax is limited to a lower tax rate. Capital gains include gains on selling stocks and bonds, real estate, and other capital assets. The gain is the excess of the proceeds over the adjusted basis (cost less depreciation deductions allowed) of the property. This limit on tax also applies to dividends from U.S. corporations and many foreign corporations. There are limits on how much net capital loss may reduce other taxable income. Tax credits: All taxpayers are allowed a credit for foreign taxes and for a percentage

neg: Economic policy of Donald Trump time of the announcement, it was unclear "how such a tax break might be structured, how it would complement existing credits and whether it would be available to tens of millions of families that don't pay income taxes because they have lower incomes." A tax deduction of the kind that Trump proposes (as opposed to a tax credit) would primarily benefit high-income people; families who pay no federal income taxes—the families most likely to be unable to afford child care—would not benefit from this plan. In September 2016, Trump presented additional details regarding his proposal, which was influenced by his

neg: Kepner Income Tax corporate income tax, which supporters argue would make the United States a tax haven and boost the economy. Critics claim that the Kepner Income Tax system could penalize work and discourage saving and investment. Phil Hinson stated that the Kepner tax would provide many benefits over the current system; however, Hinson argued that the tax rates would need to be higher than the FairTax proposal (often criticized by Kepner), that special interests would manipulate the tax, and that no formal proposal or research exists. The principles of an income tax are also argued by critics. Frank Chodorov wrote "... you

neg: Tax policy and economic inequality in the United States raising taxes on the wealthy and corporations to expand aid to the poor. By party, 29% of Republicans and 75% of Democrats supported this action. Tax policy and economic inequality in the United States Tax policy and economic inequality in the United States discusses how tax policy affects the distribution of income and wealth in the United States. Income inequality can be measured before- and after-tax; this article focuses on the after-tax aspects. Income tax rates applied to various income levels and tax expenditures (i.e., deductions, exemptions, and preferential rates that modify the outcome of the rate structure) primarily drive

neg: Jock tax tax are not the stereotypical highly-paid athletes: Many trainers and scouts do not earn much more than the national median income, and players earning the league minimum in some leagues, such as Major League Soccer, earn only around $35,000 per year. This can lead to a substantial tax complexity burden because many team members have to file income taxes in around 15-20 states each year. ... the tax hits many people who may not be able to easily absorb the substantial compliance costs associated with the tax. Jock tax In the United States, the jock tax is the colloquially named

neg: Georgia (U.S. state) income tax rates that range from 1% to 6%. In 2009, Georgians paid 9% of their income in state and local taxes, compared to the US average of 9.8% of income. This ranks Georgia 25th among the states for total state and local tax burden. The state sales tax in Georgia is 4% with additional percentages added through local options (e.g. Special-purpose local-option sales tax or SPLOST), but there is no sales tax on prescription drugs, certain medical devices, or food items for home consumption. The state legislature may allow municipalities to institute local sales taxes and special local taxes,

neg: Value-added tax chain. In many developing countries such as India, sales taxes are key revenue sources as high unemployment and low per capita income render other income sources inadequate. However, there is strong opposition to converting to VAT by many sub-national governments as the conversion leads to an overall reduction in the revenue they collect as well as of some autonomy. In principle, sales tax is only levied at the point of sale to the consumer. In practice, in some US states, it is sometimes levied at various stages during the production process. States collecting sales tax define who the consumer is.

neg: Tax avoidance tax their citizens on their worldwide income regardless of where they reside. , only the United States and Eritrea have such a practice, whilst Finland, France, Hungary, Italy and Spain apply it in limited circumstances. In cases such as the US, taxation cannot be avoided by simply transferring assets or moving abroad. The United States is unlike almost all other countries in that its citizens and permanent residents are subject to U.S. federal income tax on their worldwide income even if they reside temporarily or permanently outside the United States. U.S. citizens therefore cannot avoid U.S. taxes simply by emigrating

neg: F visa or Individual Taxpayer Identification Number, and at 30% otherwise. The student must report the tax on Line 12 of the Form 1040NR and use it in calculating his or her tax liability. Many states do not require state tax withholding on scholarship income. If the student is a resident for tax purposes, there is no federal or state tax withholding, and no form need be issued to the student. However, the student is still obliged to report the income in Line 7 of the Form 1040, and it is part of the student's taxable income. A student may engage in

neg: Hollander tax of the Puerto Rican Peso by US authorities. Hollander tax The Hollander Tax was a land tax put in place in 1900 by the Puerto Rico's US-appointed Treasurer, Jacob Hollander shortly after the acquisition of the island by the United States following the Spanish American War. It exempted lands priced below $100 and thus fell squarely on middle- and high-income landowners. Because there were no usury laws applicable in Puerto Rico like there were in the United States, interest rates spiked. It is often attributed as being a cause of the shift of land ownership to US banks. The implementation

neg: Davis v. Commissioner (constructive receipt) Davis v. Commissioner (constructive receipt) Davis v. Commissioner, T.C. Memo. 1978-12 (1978), was a case in which the United States Tax Court held that in order to have constructive receipt, a taxpayer must have notice of the attempt to transfer funds to the taxpayer. The US tax code treats every tax year separately. It is important to determine exactly when income should be attributed to a taxpayer because that will determine in which tax year they must report the income on their tax return. It is usually better for taxpayers to be able to say that they received income in

neg: Social Security (United States) Earned Income Tax Credit (FICA refunds) and federal child credits and may pay little or no FICA tax or Income tax. By Congressional Budget Office (CBO) calculations the lowest income quintile (0–20%) and second quintile (21–40%) of households in the U.S. pay an average income tax of −9.3% and −2.6% and Social Security taxes of 8.3% and 7.9% respectively. By CBO calculations the household incomes in the first quintile and second quintile have an average Total Federal Tax rate of 1.0% and 3.8% respectively. Higher income retirees will have to pay income taxes on 85% of their Social Security benefits

neg: Property Tax Circuit Breaker programs are limited to only the elderly or disabled and in all 18 states there is a maximum income level after which a taxpayer no longer qualifies for a refund. Although some states have a much more generous income ceiling, participation in these programs is limited by a requirement that the property tax liability be a certain percentage of the taxpayers yearly income. In turn, it is believed by researchers that this type of tax relief is more beneficial to low income families rather than middle or high income families. Property Tax Circuit Breaker A Property Tax Circuit Breaker is

neg: Arthur Laffer increased tax revenue. When asked whether a "cut in federal income tax rates in the US right now would raise taxable income enough so that the annual total tax revenue would be higher within five years than without the tax cut," 96% of economists surveyed in 2012 disagreed. According to Greg Mankiw, chairman of the Council of Economic Advisers under President George W. Bush, most economists have been very skeptical of Laffer's contention that decreases in tax rates could increase tax revenue, at least in the United States. In his textbook, Mankiw states, "there was little evidence for Laffer's view

neg: Fin 48 with complex tax legislation. . Fin 48 FIN 48 (mostly codified at ASC 740-10) is an official interpretation of United States accounting rules that requires businesses to analyze and disclose income tax risks. It was effective in 2007 for publicly traded entities, and is now effective for all entities adhering to US GAAP. A business may recognize an income tax benefit only if it is more likely than not that the benefit will be sustained. The amount of benefit recognized is based on relative probable outcomes. Income for financial statements may differ from taxable income for many valid reasons. U.S.

neg: Basic income the first to develop the negative income tax model. In the 1960s and 1970s, some welfare debates in the United States and Canada included discussions of basic income. Six pilot projects were also conducted with negative income tax. Then US president Richard Nixon once even proposed a negative income tax in a bill to the US Congress—but Congress eventually only approved a guaranteed income for the elderly and the disabled, not for all citizens. In the late 1970s and the 1980s, basic income was more or less forgotten in the United States, but on the other hand it started to

neg: Economic policy of the Stephen Harper government to shut down flow-through structures. In his research paper Digging Deeper he gives a perspective on how the United States taxes publicly traded flow-through entities and Master limited partnerships, the US equivalent of Canadian Income Trusts. In a January 12, 2007 paper Yves Fortin outlines his concerns regarding the claim of tax leakage. Finance Minister Jim Flaherty stated in his October 31, 2006 policy statement "If left unchecked, these corporate decisions would result in billions of dollars in less tax revenue for the federal government to invest in the priorities of Canadians, including more personal income tax relief" but Minister

neg: New Mexico 4.9%, within four income brackets. As of 2007, active-duty military salaries are exempt from state income tax. New Mexico is one of the largest tax havens in the U.S., offering numerous economic incentives and tax breaks on personal and corporate income. It does not have inheritance tax, estate tax, or sales taxes. New Mexico imposes a Gross Receipts Tax (GRT) on many transactions, which may even include some governmental receipts. This resembles a sales tax but, unlike the sales taxes in many states, it applies to services as well as tangible goods. Normally, the provider or seller passes the tax

neg: Dannel Malloy various taxes, including the income tax, the gas tax, the sales tax, and the estate tax, as well as $1 billion each year in union concessions. Malloy chose not to reduce aid to municipalities as part of his budget agenda, although such aid would have been jeopardized if labor concessions were not reached. After two months of negotiations, in May 2011, Malloy won $1.6 billion in union givebacks. The budget deal meant that, in contrast to many other states, there were no layoffs. Many of Malloy's proposed tax increases were unpopular, despite a statewide "listening tour" to promote the budget.

neg: Multiple citizenship its residents, and he would be subject to U.S. taxation because he holds US citizenship. In general, he would be allowed to subtract the Australian income tax he paid from the US tax that would be due. Plus, the U.S. will allow some parts of foreign income to be exempt from taxation; for instance, in 2006 the foreign earned income exclusion allowed up to US$82,400 of foreign salaried income to be exempt from income tax (in 2014, this has now increased to US$97,600). This exemption, plus the credit for foreign taxes paid mentioned above, often results in no US taxes

neg: State income tax taxable income in most states, with limited modifications. The states are prohibited from taxing income from federal bonds or other obligations. Most do not tax Social Security benefits or interest income from obligations of that state. Several states require different useful lives and methods be used by businesses in computing the deduction for depreciation. Many states allow a standard deduction or some form of itemized deductions. States allow a variety of tax credits in computing tax. Each state administers its own tax system. Many states also administer the tax return and collection process for localities within the state that impose

neg: State income tax Income tax is self assessed, and individual and corporate taxpayers in all states imposing an income tax must file tax returns in each year their income exceeds certain amounts determined by each state. Returns are also required by partnerships doing business in the state. Many states require that a copy of the federal income tax return be attached to at least some types of state income tax returns. The time for filing returns varies by state and type of return, but for individuals in many states is the same (typically April 15) as the federal deadline. Every state, including those

neg: State income tax taxpayers. The "substantial nexus" requirement of "Complete Auto", supra, has been applied to corporate income tax by numerous state supreme courts. The courts have held that the requirement for fair apportionment may be met by apportioning between jurisdictions all business income of a corporation based on a formula using the particular corporation's details. Many states use a three factor formula, averaging the ratios of property, payroll, and sales within the state to that overall. Some states weight the formula. Some states use a single factor formula based on sales. Some states tax resident corporations on nonbusiness income regardless of apportionment.

neg: Income tax in the United States which include pensions, unemployment and other benefits. The United States had the highest "concentration coefficient" in income tax, a measure of progressiveness, before adjusting for income inequality. The United States was not at the top of either measure for cash transfers. Adjusting for income inequality, Ireland had the highest concentration coefficient for income taxes. In 2008, overall income tax rates for the US were below the OECD average. According to the CBO, U.S. federal tax policies substantially reduce income inequality measured after taxes. Taxes became less progressive (i.e., they reduced income inequality relatively less) measured from 1979 to 2011. The

neg: Earned income tax credit assisted banks in determining whether RAL applications were approved. Beginning with the 2013 tax season, major banks are no longer offering RALs but only RACs. However, a March 2013 article in "CNN Money" reported that tax prep companies are offering a hodgepodge of financial products similar to RALs. The article further states that, "The NCLC [National Consumer Law Center] also found that some shady tax preparers are even offering tax refund loans to lure taxpayers into their offices, but have no intention of lending them the money." Taxpayer info/tools: Organizations/campaigns: Background: Policy analysis: Earned income tax credit The United States

neg: Competitive Tax Plan Cardin's Progressive Consumption Tax Act has many similar features. Competitive Tax Plan The Competitive Tax Plan is an approach to taxation, suggested in the United States, that would impose a 10–15% value added tax (VAT) and reduce personal and corporate income taxes. The plan was created by Michael J. Graetz, professor at Columbia law school, and a former Deputy Assistant Secretary of the Treasury for Tax Policy. Graetz states that it would generate enough revenue so that families with $100,000 of annual income or less — almost 90% of all current filers — would not have to pay income taxes

neg: Foreign tax credit sub-federal (provincial, cantonal, state) jurisdictions. Thus, for example, Canadian and US federal governments allow credits from all foreign levels, while Canadian provinces and US states tend to allow a credit for income taxes paid to other provinces and states but not for taxes paid to sovereign jurisdictions (countries). Sub-federal taxes may or may not be covered by income tax treaties. Most systems limit FTC in some manner. A common limitation is based on the domestic income tax considered generated by the foreign source income subject to tax. This limitation may be applied overall or at one or more of the

neg: Income tax in the United States state income tax laws do not conform with federal tax law in material respects. These factors and others have resulted in substantial complexity. Even venerable legal scholars like Judge Learned Hand have expressed amazement and frustration with the complexity of the U.S. income tax laws. In the article, "Thomas Walter Swan", 57 Yale Law Journal No. 2, 167, 169 (December 1947), Judge Hand wrote: In my own case the words of such an act as the Income Tax ... merely dance before my eyes in a meaningless procession: cross-reference to cross-reference, exception upon exception—couched in abstract terms that offer [me]

neg: Hollander tax Hollander tax The Hollander Tax was a land tax put in place in 1900 by the Puerto Rico's US-appointed Treasurer, Jacob Hollander shortly after the acquisition of the island by the United States following the Spanish American War. It exempted lands priced below $100 and thus fell squarely on middle- and high-income landowners. Because there were no usury laws applicable in Puerto Rico like there were in the United States, interest rates spiked. It is often attributed as being a cause of the shift of land ownership to US banks. The implementation of this law coincided with an artificial devaluation

neg: Progressivity in United States income tax so this sort of "tax break" is anti-progressive. Further clouding the issue of progressivity is that far more deductions and tax credits are available to higher-income taxpayers. A taxpayer with $40,000 of wage income may only have the "standard" deductions available to him, whereas a taxpayer with $200,000 of wage income might easily have $50,000 or more of "itemized" deductions. Allowable itemized deductions include payments to doctors, premiums for medical insurance, prescription drugs and insulin expenses, state taxes paid, property taxes, and charitable contributions. In those two scenarios, assuming no other income, the tax calculations would be as follows for

neg: Negative income tax notion has long been popular in some circles, its implementation has never been politically feasible. This is partly because of the very complex and entrenched nature of most countries' current tax laws: they would have to be rewritten under any NIT system. However, some countries have seen the introduction of refundable (or non-wastable) tax credits which can be paid even when there is no tax liability to be offset, such as the Earned Income Tax Credit in the United States and working tax credit in the UK. In 1971, President Richard Nixon proposed a negative income tax as the centerpiece

neg: Corporate tax in the United States failing to withhold and pay over such taxes. Nearly all of the states and some localities impose a tax on corporation income. The rules for determining this tax vary widely from state to state. Many of the states compute taxable income with reference to federal taxable income, with specific modifications. The states do not allow a tax deduction for income taxes, whether federal or state. Further, most states deny tax exemption for interest income that is tax exempt at the federal level. Most states tax domestic and foreign corporations on taxable income derived from business activities apportioned to the state

neg: 529 plan although contributions are not deductible from the donor's federal income tax liability, many states provide state income tax benefits for all or part of the contributions of the donor. Beyond the potential state income tax deduction possibilities, a prime benefit of the 529 plan is that the principal grows tax-deferred and distributions for the beneficiary's college costs are exempt from tax. Many states give the account owner a full or partial state income tax deduction or tax credit for their contributions to the state's section 529 plans. So far a total of 34 states and the District of Columbia offer

neg: Americans Standing for the Simplification of the Estate Tax capital gains rate at the time of the actual sale, regardless of how long the individual has been deceased. This program would be completely voluntary and therefore would not involve a new tax being imposed by the United States Congress. Those taxpayers who opt in to the ASSET plan would pay surcharge on their annual income while they are alive and no estate tax would be assessed once they have died, only when an heir sells an asset. Diana Furchgott-Roth, former chief economist for the U.S. Department of Labor and a senior fellow at the Manhattan Institute, mentioned the ASSET

neg: State income tax states do not level a broad-based individual income tax. Some of these do tax certain forms of personal income: The following eight states have a flat rate individual income tax as of 2016: The following states have local income taxes. These are generally imposed at a flat rate and tend to apply to a limited set of income items. Alabama: California: Colorado: Delaware: Indiana (all local taxes reported on state income tax form): Iowa (all local taxes reported on state income tax form): Kansas: Kentucky: Maryland (all local taxes reported on state income tax form): Michigan: Missouri (all other cities

neg: Double taxation pro-rated. (See IRS form 2555.) Second, the United States allows a foreign tax credit by which income tax paid to foreign countries can be offset against U.S. income tax liability attributable to any foreign income not covered by this exclusion. This can be a complex issue that often requires the services of a tax advisor. The foreign tax credit is not allowed for tax paid on earned income that is excluded under the rules described in the preceding paragraph (i.e. no double dipping). Double taxation can also happen within a single country. This typically happens when subnational jurisdictions have taxation

neg: Progressivity in United States income tax Progressivity in United States income tax In general, the United States federal income tax is progressive, as rates of tax generally increase as taxable income increases, at least with respect to individuals that earn wage income. As a group, the lowest earning workers, especially those with dependents, pay no income taxes and may actually receive a small subsidy from the federal government (from child credits and the Earned Income Tax Credit). "Progressivity" as it pertains to tax is usually defined as meaning that the higher a person's level of income, the higher a tax rate that person pays. In the

neg: Tax because a high level of consumption means that people are already spending many hours working, so, in this situation, they need more free time than consume and it implies that they have to be paid with a higher salary to work an additional hour. A proportional income tax, changing budget constraint's slope (now Y = "w"(1 - "t")(H - F)), implies both substitution and income effects. The problem now is that the two effects go in opposite ways: income effect tells us that, with an income tax, the consumer feels poorer and for this reason he wants to work more,

neg: Property tax in the United States on sprawl include: Property tax has been shown to be regressive (that is, to fall disproportionately on those of lower income) when not correctly implemented because of its impact on particular low-income/high-asset groups such as pensioners and farmers. Because these persons have high-assets accumulated over time, they have a high property tax liability, although their realized income is low. Therefore, a larger proportion of their income goes to paying the tax. In areas with speculative land appreciation (such as California in the 1970s and 2000s), there may be little or no relationship between property taxes and a homeowner's ability to

neg: Taxation in India Article 246 of the Indian Constitution, distributes legislative powers including taxation, between the Parliament of India and the State Legislature. Schedule VII enumerates these subject matters with the use of three lists: Separate heads of taxation are no head of taxation in the Concurrent List (Union and the States have no concurrent power of taxation). The list of thirteen Union heads of taxation and the list of nineteen State heads are given below: Income Tax is a tax imposed on individuals or entities (taxpayers) that varies with respective income or profits (taxable income). Income tax generally is computed as the

neg: Direct tax applied to all forms of income until the 16th Amendment was ratified in 1913. After the Sixteenth Amendment, no Federal income taxes are required to be apportioned, regardless of whether they are direct taxes (taxes on income from property) or indirect taxes (all other income taxes). Tax policy in the European Union (EU) consists of two components: direct taxation, which remains the sole responsibility of member states, and indirect taxation, which affects free movement of goods and the freedom to provide services. With regard to European Union direct taxes, Member States have taken measures to prevent tax avoidance and double

neg: Supply-side economics effects of income tax cuts on pre-tax income inequality, although one 2013 study indicated a strong correlation between how much top marginal tax rates were cut and greater pre-tax inequality across many countries. However, an important side effect of income tax cuts in the U.S. is an increase in after-tax income inequality (other things equal), meaning the top earners receive a greater share of the after-tax income. This is due to several tax policy factors: For example, the Tax Policy Center evaluated a detailed supply-side tax cut proposal from presidential candidate Jeb Bush in 2015. Their conclusion was that the

neg: Tax-free shopping use taxes, several US states have been working to implement a "streamlined" interstate use tax agreement. To effectuate this multilateral interstate compact, many states have enacted, or are considering enacting, statutory changes that require residents to disclose, under penalty of perjury, their annual use tax liability for out-of-state purchases. The focus on use tax collection has increased because the U.S. Supreme Court has placed significant hurdles in the path of state efforts to collect sales taxes on transactions in other no-tax or lower-tax jurisdictions. In "National Bellas Hess, Inc. v. Department of Revenue of the State of Illinois" and "Quill

neg: Conservation easement tried to enact additional tax incentives for landowners to donate easements, above the federal charitable deduction (and state tax deduction in states that conform to federal tax process). There has been discussion of creating a federal income tax credit for easement donors since around 1980. However, no federal tax credit has been enacted. States, however, have moved ahead to grant credits that can be used to pay state income tax to donors of qualified conservation easements. In 1983, North Carolina became the first state to establish such a program. Attorney Philip Tabas of The Nature Conservancy promoted the state tax

neg: Cancellation of Debt (COD) Income Cancellation of Debt (COD) Income Taxpayers in the United States may have tax consequences when debt is cancelled. This is commonly known as COD (Cancellation of Debt) Income. According to the Internal Revenue Code, the discharge of indebtedness must be included in a taxpayer's gross income. There are exceptions to this rule, however, so a careful examination of one's COD income is important to determine any potential tax consequences. Billions of dollars of cancelled debts will generate many unexpected tax bills, due to debt cancellations that financial institutions have started accelerating in 2012. The standard definition of income is found

neg: Basic income for the state and cities to fund public projects. The degree of any disincentive to employment because of basic income would likely depend on how generous the basic income was. Some studies have looked at employment levels during the experiments with basic income and negative income tax, and similar systems. In the negative income tax-experiments in United States in the 1970s, for example, there was a five percent decline in the hours worked. The work reduction was largest for second earners in two-earner households and weakest for the main earner. The reduction in hours was higher when the benefit was

neg: Sales taxes in the United States many local jurisdictions require separate reporting. Some jurisdictions permit or require electronic filing of returns. Purchasers of goods who have not paid sales tax in their own jurisdiction must file use tax returns to report taxable purchases. Many states permit such filing for individuals as part of individual income tax returns. Purchasers are required to pay sales tax unless they present the seller with certification that the purchase is exempt from tax (exemption certificate). The certificate must be on a form approved by the state. 38 states have approved use of the Multistate Tax Commission's Uniform Sales and Use Tax

neg: Income tax in the United States individuals and corporations in some jurisdictions. Some states impose alternative or additional taxes based on a second measure of income or capital. States and localities tend to tax all income of residents. States and localities only tax nonresidents on income allocated or apportioned to the jurisdiction. Generally, nonresident individuals are taxed on wages earned in the state based on the portion of days worked in the state. Many states require partnerships to pay tax for nonresident partners. Tax returns are filed separately for states and localities imposing income tax, and may be due on dates that differ from federal due

neg: Income tax in the United States nature of the taxpayer's affairs. Many individuals are able to use the one page Form 1040-EZ, which requires no attachments except wage statements from employers (Forms W-2). Individuals claiming itemized deductions must complete Schedule A. Similar schedules apply for interest (B), dividends (B), business income (C), capital gains (D), farm income (F), and self-employment tax (SE). All taxpayers must file those forms for credits, depreciation, AMT, and other items that apply to them. Electronic filing of tax returns may be done for taxpayers by registered tax preparers. If a taxpayer discovers an error on a return, or determines that tax

neg: Tax protester history in the United States to follow these dead arguments will only result in disaster". Furthermore, in addition to those who express heartfelt beliefs about the tax laws, some con artists have been known to take advantage of the beliefs of tax protesters by profitably engaging in "tax scams". Such scams have included "the marketing of bogus trusts, 'untax' kits or other devices that would ostensibly allow people to avoid paying income taxes". Some people who do not pay income taxes have been able to do so successfully for many years. Others have been arrested for tax evasion or other tax crimes, and have been

neg: Income tax in the United States increase complexity, irrespective of the system's flatness or lack thereof. Income tax is also levied by most U.S. states and many localities on individuals, corporations, estates, and trusts. These taxes are in addition to federal income tax and are deductible for federal tax purposes. State and local income tax rates vary from 1% to 16% of taxable income. Some state and local income tax rates are flat (single rate) and some are graduated. State and local definitions of what income is taxable vary highly. Some states incorporate the federal definitions by reference. Taxable income is defined separately and differently for

neg: Progressivity in United States income tax and paid 9.6%. The lowest quintile earned 9.8% and paid 4.3% of total taxes. Progressivity in United States income tax In general, the United States federal income tax is progressive, as rates of tax generally increase as taxable income increases, at least with respect to individuals that earn wage income. As a group, the lowest earning workers, especially those with dependents, pay no income taxes and may actually receive a small subsidy from the federal government (from child credits and the Earned Income Tax Credit). "Progressivity" as it pertains to tax is usually defined as meaning that the higher a

neg: Elizabeth Wilks However Elizabeth, who as a doctor, earned more than her husband refused to tell her husband how much she earned. This put the authorities into a quandary as Elizabeth was not liable to pay tax and her husband was nominally willing to pay the tax but he said that he had no idea how much to pay. There was no legal requirement for Elizabeth to tell her husband about her income. In 1910 the authorities illegally seized some of her goods in an attempt to levy the tax on her income. The authorities then tried to claim the tax either

neg: Income tax in the United States pay income tax due without waiting for an assessment. Many taxpayers are subject to withholding taxes when they receive income. To the extent withholding taxes do not cover all taxes due, all taxpayers must make estimated tax payments. Tax penalties: Failing to make payments on time, or failing to file returns, can result in substantial penalties. Certain intentional failures may result in jail time. Tax returns may be examined and adjusted by tax authorities. Taxpayers have rights to appeal any change to tax, and these rights vary by jurisdiction. Taxpayers may also go to court to contest tax changes. Tax

neg: New Hampshire power, hydroelectricity, and wood fuel. The state has no general sales tax and no personal state income tax (the state does tax, at a 5 percent rate, income from dividends and interest), and the legislature has exercised fiscal restraint. Efforts to diversify the state's general economy have been ongoing. New Hampshire's lack of a broad-based tax system has resulted in the state's local communities having some of the nation's highest property taxes. However, the state's overall tax burden is relatively low; in 2010 New Hampshire ranked 44th highest among states in combined average state and local tax burden. As of

neg: Snowbird (person) climate. Many of these "snowbirds" also use their vacation time to declare permanent residency in low- or no-tax income tax states (where the tax bases are augmented by high tourism taxes), and claim lower non-resident income taxes in their home states. Canadian snowbirds usually retain residency in Canada in order to retain health benefits. Due to the implementation of the Patient Protection and Affordable Care Act there are now additional implications for Canadian snowbirds in the United States. In the United States, the right to vote for local office is governed by local and state law, so it may be

neg: Income tax in the United States income above £200. The tax proposal was developed in 1814. Because the treaty of Ghent was signed in 1815, ending hostilities and the need for additional revenue, the tax was never imposed in the United States. In order to help pay for its war effort in the American Civil War, Congress imposed its first personal income tax in 1861. It was part of the Revenue Act of 1861 (3% of all incomes over US $800). This tax was repealed and replaced by another income tax in 1862. In 1894, Democrats in Congress passed the Wilson-Gorman tariff, which imposed the first

neg: Credit unions in the United States first organizing in the US in the early 20th century, the banking industry was opposed, remaining so ever since. Banks and bank trade associations consistently put anti-credit union legislation at the top of their agendas. Due to their status as not-for-profit, member-owned financial institutions with no source of secondary investment capital, credit unions in the US are exempt from federal and state income taxes (but not from other forms of tax, such as payroll, sales, or property taxes). Credit union members themselves pay income tax on dividends earned through financial participation in the credit union; this is similar to the

neg: Taxation in the United States level. Some states have alternative measures of taxable income, or alternative taxes, especially for corporations. States imposing an income tax generally tax all income of corporations organized in the state and individuals residing in the state. Taxpayers from another state are subject to tax only on income earned in the state or apportioned to the state. Businesses are subject to income tax in a state only if they have sufficient nexus in (connection to) the state. Foreign individuals and corporations not resident in the United States are subject to federal income tax only on income from a U.S. business and

neg: Haig–Simons income contributions to employee health insurance are not included in taxable employee income. Under the Haig–Simons definition of income, such contributions would be included in income. Such contributions might not be included in a Haig–Simons income tax base, however, if their exclusion reflected "an appropriate adjustment in measuring ability to pay." The European Union and most states in the USA employ a tax on Haig–Simons income with a consumption tax. In the European Union, a value added tax applies to purchases of goods and services on each level of exchange until it reaches the ultimate consumer. In the US, most states

neg: Tax withholding in the United States the amount of tax being collected, i.e. it reduced the transparency of the tax, which made it easier to raise taxes in the future. In the US, withholding by employers of tax on wages is required by the federal, most state, and some local governments. Taxes withheld include federal income tax, Social Security and Medicare taxes, state income tax, and certain other levies by a few states. Income tax withheld on wages is based on the amount of wages less an amount for declared withholding allowances (often called exemptions). Amounts of tax withheld are determined by the employer. Tax rates