Tax Facts & Figures
As we begin a new year, many people create budgets so they manage their finances well and then refine them through out the year. We are strong advocates of the Dave Ramsey Financial Peace University program and highly recommend it regardless if you are just beginning your journey, trying to work your way out of debt, or are nearing retirement. In that vain, it’s always a good idea to understand the impact taxes have on our cash flow. The U.S. has a graduated federal income tax system at both the corporate and individual level. Social security tax impacts employers and employees. Many states also have an income tax. In general, overall tax rates range from 30-50% of income.
The individual rate is impacted by a number of factors including the following:
–Marital status (residency can impact this)
–Income type (wages, self-employed, ordinary, capital gain)
–Thresholds which determine phase outs of exemptions and itemized deductions as well as other taxes such as Additional Medicare tax and net investment income tax
The 2017 Tax Facts and Figures provides an overview of the federal individual income tax system which can be used to help you create and fine tune your 2017 budget. The 2016 Tax Facts and Figures is a great tool to aid in understanding the final results of the current individual tax returns which are due April 18th.
- Copyright© 2016 Tax Materials, Inc.