Tax law is the branch of law that deals with the laws and regulations that govern the assessment and collection of taxes. It is a complex and multifaceted area of law that touches on many different aspects of the legal system, including business law, public finance, and administrative law. Tax law is an important area of law because it plays a central role in the functioning of modern governments, which rely on tax revenue to fund their operations and provide public goods and services.
There are many different types of taxes that are imposed by governments at various levels, including federal, state, and local. Some common types of taxes include:
The deadline to file taxes is typically April 15 of the year, but this is only one half of the tax filing window. According to the IRS, tax season begins on January 24, but either end of this window can be extended depending on the calendar year. For example, in 2022, Emancipation Day fell on April 15, causing a slight extension of the deadline to April 18. Additionally, some local holidays may also extend the deadline. In 2022, taxpayers in Maine and Massachusetts received an extension of the deadline to April 19, due to Patriot’s Day.
Sometimes you need more time to file your tax return. In order to file for an extension, you will need to submit Form 4868, Application for Automatic Extension of Time To File U.S. Individual Income Tax Return. This application, which can be filed digitally, extends your deadline to file your taxes until October 15. This does not move the deadline to pay taxes, only to file taxes.
Capital gains tax is a levy placed on the profits that an individual makes when their investment is sold. Capital gains tax is not paid until an investment is sold and the investment must have been held for at least one year. For individuals selling an investment that is less than a year old, short-term capital gains tax will apply instead. Capital gains tax is based on the income level of the individual paying the tax.
For individuals who make between $0 - $41,675 annually, the tax rate is 0%. For people making between $41,675 and $459,750 the capital gains tax rate is 15%. Finally, anyone who makes more than $459,750 annually will pay a 20% tax on their investment profits.
Income tax is a type of tax that is based on the amount of money that an individual is paid. In general, income tax is levied by the federal government with some state and local governments having income taxes as well. For people working in an hourly or salaried position, most employers will remove their income taxes automatically.
Income tax is levied on a progressive basis. That means that as an individual makes more money, they will owe more taxes. The progressive tax rate ranges from 10% at the low end to 37% at the high end. Additionally, some individuals who live beneath the poverty line may be exempted from income taxation.
The Internal Revenue Service (IRS) is a federal agency in the United States that is responsible for enforcing tax laws and collecting tax revenue. The IRS administers the tax laws enacted by Congress and is responsible for interpreting and implementing these laws. This includes issuing guidance on tax issues, conducting audits, and enforcing compliance with tax laws through penalties and fines. The IRS also provides assistance to individuals and businesses in understanding and complying with tax laws.
If you have a dispute with a tax authority, it is important to seek legal assistance as soon as possible in order to protect your interests and resolve the dispute. This can involve negotiating with the tax authority, appealing a tax decision, or even taking legal action in court. A qualified tax attorney or accountant can help you navigate the process and represent your interests in the dispute. It is important to act promptly and to carefully follow the procedures and deadlines set by the tax authority in order to maximize your chances of a successful outcome.