How do tax forms typically vary between states?


Quick Answer

State tax forms vary based on the type and amount of taxes that specific jurisdictions impose; some states in the United States have tiered tax brackets with taxes adjusted to income levels, while others have a single tax rate for all citizens and some have no income tax at all. When establishing income tax levels, states generally follow the federal standards, states TaxPolicyCenter.org. However, they may impose alternative tax rules that control what percentage and type of income qualifies for taxation.

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Full Answer

Most states and the District of Columbia require contributions from individual citizens for taxes. Some impose a flat rate, and charge all citizens the same amount in taxes regardless of income. Others have tax brackets and tax citizens on a graduated scale according to taxable income, according to TaxPolicyCenter.org.

In addition to determining the type of income that qualifies for taxation, states have the discretion to adjust their own tax brackets. In some states, such as Alabama, the top tax bracket starts at a very low income level, around $3,000 as of 2015. Other states, such as New York and California, have millionaire's taxes, which require additional tax payments from individuals earning seven figures each year.

Some states exclusively impose state taxes on citizens, while others add on local or municipal taxes. In 13 states, local governments tack on an additional tax requirement for citizens, states TaxPolicyCenter.org. These rates range from five percent to over 15 percent of state income.

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