Income, Deductions, and Exclusions



Abstract

The research paper throws light on the tax system of the United States of America. The policies of the present, as well as, the previous governments regarding imposition of taxes are also discussed. Moreover, the planning and execution of the plans regarding the implementation of progressive income taxes is also brought under discussion. Income, Deductions, and Exclusions

Introduction

The United States of America is an autonomous federal republic that has many local governments and autonomous states. Taxes are imposed in the country at all the mentioned levels. The taxes imposed include property, income, estates, imports, payroll, sales, and gifts. There also are various fees at these different levels. The percentage of taxes collected in the year 2012 was about 26% of GDP. The United States of America has the one of the most progressive system of taxed in the entire industrialized world. The authority of imposing taxes rests with the local government, the states, as well as, the federal government (www.law.cornell.edu). The residents of Unites States of America, as well as, the citizens are allowed a credit for the foreign taxes and are taxed on the worldwide income that they have. For the determination of the income under tax, the accounting principles, as well as, rules are used. This determining of income under tax is not determined by the financial principles, and in most of the cases, the income from all the resources are included in the taxes. Property taxes are imposed by the special purpose authorities, as well as, the local governments based on their fair market value. The state and the federal governments impose the payroll taxes. The sales tax is imposed based in the retail sales of some services and many goods (www.nber.org).

Discussion

Taxing the Rich Heavily

The current government of the United States thinks that the solution ...