Taxes

A:

Public works are financed using tax dollars. The largest portion of tax revenues (24 percent) are spent on Social Security by way of payments to the elderly and disabled.

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  • Do You Pay Taxes on Life Insurance Payouts?

    Q: Do You Pay Taxes on Life Insurance Payouts?

    A: Life insurance that pays out on the death of an insured person is not taxable unless the policy was turned over to the recipient for a price, according IRS Publication 525. Any amount received in excess of the value of the insurance is interest and is taxable.
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  • What Is Taxation?

    Q: What Is Taxation?

    A: Taxation is when governments require citizens to pay a certain amount of money to help fund public institutions. Taxes are used to pay for things like public education, welfare programs, transportation infrastructure, defense funds and libraries.
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  • Why Are Taxes Important?

    Q: Why Are Taxes Important?

    A: The IRS indicates that taxes are vital to support the infrastructure that citizens rely on at the local, state and federal levels. Taxes support national defense programs, roadway construction, social service programs, public health and education. Without taxpayer support, many of these programs cannot exist.
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  • Can I Claim My Dog on My Taxes?

    Q: Can I Claim My Dog on My Taxes?

    A: People cannot claim their dogs as dependents on their federal income taxes. According to the Internal Revenue Service Publication 501, a dependent must have a valid tax identification number to be claimed.
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  • What Is France's "Google Tax"?

    Q: What Is France's "Google Tax"?

    A: France's so-called "Google tax" isn't aimed at the search-engine company but rather at the international tech industry as a whole. The tax allows the French government to levy taxes on Internet companies that operate in France like traditional businesses.
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  • What Are the Characteristics of a Good Tax System?

    Q: What Are the Characteristics of a Good Tax System?

    A: The strongest tax systems create fairness, assure adequacy, simplicity, transparency and promote administrative ease according to the Oklahoma Policy Institute. Ultimately, strong and healthy tax systems create healthy and vibrant economies, and may even promote peace and create strong and stable governments.
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  • What Are Energy Tax Credits?

    Q: What Are Energy Tax Credits?

    A: Energy tax credits are incentives to lower taxes for people who use alternative energy resources. These are authorized by the U.S. Congress. They work by reducing income tax owed by a dollar-for-dollar basis. In contrast, a tax deduction lowers the amount of income subject to tax.
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  • How Can You Find Out Whether You Owe Money to the IRS?

    Q: How Can You Find Out Whether You Owe Money to the IRS?

    A: The IRS Tax Help Line for individual taxpayers, available at 1-800-829-1040, provides information about prior-year tax returns and any account balances due to the IRS. This line is designed for taxpayers who submitted a Form 1040 return.
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  • What Is a Luxury Tax?

    Q: What Is a Luxury Tax?

    A: A luxury tax is essentially a tax placed on any goods or services the United States government as well as many state governments deem as non-essential. Such a tax is aimed at only those who are wealthy enough to afford luxury items. Despite the fact that many items formerly considered luxury goods no longer are viewed that way, the term persists.
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  • How Do You Get an EIN Number?

    Q: How Do You Get an EIN Number?

    A: Contact the Internal Revenue Service to apply for an Employee Identification Number (EIN). Apply online, by mail, fax or phone. Business owners who apply over the phone should be prepared to answer the same questions included on the IRS Form SS-4, Application for an Employer Identification Number.
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  • How Can You Tell If the IRS Received Your Tax Return?

    Q: How Can You Tell If the IRS Received Your Tax Return?

    A: One simple way to see if the IRS has received your tax return, especially if you are anticipating a refund, is to use the IRS's "Where's My Refund" tool. The IRS updates refund statuses every 24 hours.
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  • What Kinds of Things Might Get You Audited?

    Q: What Kinds of Things Might Get You Audited?

    A: While only about 1 percent of taxpayers get audited every year, there are a few red flags the IRS tends to look out for in order to determine the unlucky few who fall under that category. These include tax filings that point to carelessness or dishonesty.
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  • Can You Deduct Healthcare Costs From Your Taxes?

    Q: Can You Deduct Healthcare Costs From Your Taxes?

    A: While there are some ways to deduct medical expenses from federal taxes, the rules for who and what qualifies for these deductions are strict and may be a bit confusing to some taxpayers. For example, there is a rule stating that taxpayers and the spouses of taxpayers who are 65 years and older may deduct medical expenses that are more than 7.5 percent of the taxpayer's gross income so long as those expenses were not reimbursed. This rule only applies during the period of Jan. 1, 2013 through Dec. 31, 2016, further narrowing the field of which senior citizen taxpayers qualify to claim medical expenses on a tax return.
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  • What Country Had a Beard Tax?

    Q: What Country Had a Beard Tax?

    A: Though the law is no longer in place, in the 1700s Russia had a federal tax on people with beards. The motivation for this strange revenue source stemmed from the country's then-ruler, Peter the Great, and his crusade against facial hair.
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  • What Are Some Examples of Indirect Tax?

    Q: What Are Some Examples of Indirect Tax?

    A: One example of an indirect tax is sales tax, which is imposed entirely on the buyer rather than both on the seller and the buyer. Indirect taxes are taken from stakeholders that are generally not thought to be entirely responsible for the amount being taxed.
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  • What Is the Purpose of an Audit?

    Q: What Is the Purpose of an Audit?

    A: An audit is a process that the Internal Revenue Service uses to check that the numbers of an account correspond with the tax return. While the IRS chooses to audit those with suspicious activity on their returns, there are also audits on a random sample of people and companies.
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  • What Is the "cow Flatulence Tax"?

    Q: What Is the "cow Flatulence Tax"?

    A: In the United States, a cow flatulence tax does not exist, but some European nations have imposed taxes on cow owners. The main argument for a cow flatulence tax is that cows release methane, one of the greenhouse gases that causes climate change.
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  • What Is the Percentage Taken Out for Taxes on a Paycheck?

    Q: What Is the Percentage Taken Out for Taxes on a Paycheck?

    A: Precise percentages vary based on state, but according to the Ventures Scholars Program, four primary taxes are withheld from paychecks: federal income tax, state income tax, social security tax and Medicare tax. According to The Law Dictionary, taxes are withheld on a sliding scale that extracts more income from higher-earning individuals, topping out at 39.6 percent in 2014.
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  • How Does One Check If One Owes IRS Back Taxes?

    Q: How Does One Check If One Owes IRS Back Taxes?

    A: People can check to see if they owe the Internal Revenue Service (IRS) taxes by calling the toll-free number for the IRS, which is (800) 829-1040. People can also visit a local IRS office.
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  • How Many Years Can You File Back Taxes?

    Q: How Many Years Can You File Back Taxes?

    A: Back taxes can be filed for up to 10 years after the tax year in which the resident neglected to file income taxes, according to ETaxes.com. After 10 years, the statute of limitations runs out for the Internal Revenue Service to collect back taxes in most states. In a few states, the statute of limitations never runs out, meaning back taxes can be filed at any point in the resident's life.
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  • How Much Is the Import Tax From China to the USA?

    Q: How Much Is the Import Tax From China to the USA?

    A: The import tax from China to the United States varies based on the product. For instance, the maximum amount of tariff for imported eel products is 16 percent, while the same maximum for imported zinc oxide is 5.5 percent.
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