Types of Taxes By: Alison Giffen (Websites Used (https://www.investopedia…
Types of Taxes By: Alison Giffen
An income tax is a tax that government impose on incomes of businesses and individuals
The amount one is taxed is based off of how much income they make
A sales tax is a consumption tax imposed by the government on the sale of goods and services.
Sales taxes can vary from state to state and some, like New Hampshire, don't have it
Flat vs Progressive Taxes
Flat taxes are assigned one rate and is the same among all taxpayers.
Progressive taxes are tiered rates that charge higher income, higher percentages of their income and the lowest rates to lowest incomes.
An inheritance tax is imposed by certain states on those who inherit assets from the estate of a deceased person
Its tax rate depends on the state of residence, the value of the inheritance, and the beneficiary's relationship to the decedent
An estate tax is a levy on estates whose value exceeds an exclusion limit set by law. Only the amount that exceeds that minimum threshold is subject to tax.
The tax is levied by the state in which the deceased person was living at the time of their death
A payroll tax is a tax withheld from an employee's salary by an employer who remits it to the government on their behalf.
The amount withheld is based on wages, salaries, and tips paid to employees and is directly deducted from an employees pay check
Gift taxes are placed on the person giving the gift when it is over a certain amount of money
Property tax is a tax paid on property owned by an individual or other legal entity, such as a corporation
The tax is usually based on the value of the owned property, including land.