Income Tax question

sandy · Apprentice Joined: 03 Sep 2004 Posts: 3

Hello! I have a problem regarding income tax. In a matter of fact, it is not really a problem. It is more my curios nature about income tax in general. I work hard for that money and I have to give it away to some tax officer. I am beginning to ask myself where that money goes. Could you please explain to me the whole procedure? I'm tired of writing those checks and not have a clue where my money goes.

ewell · Apprentice Joined: 14 Apr 2006 Posts: 6

That question is bothering many of us. An income tax is gathered on the financial income of persons, companies or other legal entities. There are many income tax systems with varying tax rates. Income tax can be progressive, proportional and repressive. The rates for different types of income may be different and some may not be taxed at all. Tax rates may be progressive, regressive or flat. A progressive tax is based on how much has been earned. For example, the first 10,000 is taxed at 5%, the next 10,000 is taxed at 10% and any more income on 20%. A flat tax taxes all earning at the same rates. A regressive income tax may tax income up to certain amount. The money that government receives from taxes has a various functions. It goes for a retirement cash, military funding, health care, and so on.

Income Tax question

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