Taxes and Tax Preparation
Income Taxes

Is federal income tax direct or indirect?


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2014-05-14 22:29:42
2014-05-14 22:29:42

Federal income tax is a direct tax on income and not an indirect tax. Direct taxes are paid directly to the government.


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Income tax is a direct tax levied on your earnings. An indirect tax is the tax you pay if you buy something, after all, you don't have to buy the goods and so pay the indirect tax.

A direct tax is one that is taken directly from the individual, such as income tax. Indirect taxes, such as sales tax, are collected by merchants and taken from the consumer. Indirect taxes also lead to inequalities while direct taxes do not.

In India... the list of direct and indirect taxes.. is as following.. Direct Tax: Income tax corporation tax property tax inheritence (estate) tax & gift tax Indirect tax: customs duty, central excise duty, service tax, sales tax, value added tax (VAT), securities transaction tax

State Income Tax is an extension of the Federal Income Tax. The ability to collect a State income tax requires that the Indirect Excise Taxable event has occurred within the borders of such State with an income tax and that there is federally adjusted gross income. ** See my other responses on what is the income tax to understand the nature of the income tax ** State income taxes are not separate from the Federal income tax, but are merely an extension of the federal tax where otherwise federal income tax liability exists, the State collects a share, that's it.

As many people know, the state and federal government level taxes are the direct form of taxation;for example, corporate taxes are another form of direct tax--those taxes levied against income earned by corporations. soc sec , medicare, estate and gift taxes are more types of direct tax, as is the income tax charged by the state you live in. The simple definition of a direct tax is one that you have no choice in paying.

A direct tax is a tax exacted directly from the persons who will bear the burden of it (without reimbursement to them at the MORE?.An example of direct taxation would be income taxes that are collected from the people who actually earn their income...more

Toll tax is a direct tax

One example of indirect tax is Income Tax.

iam not sure about the answer 1.income tax tax 3.indirect tax 4.corpration tax

federal income tax people

Indirect tax because they are impose on goods and services

No. It is indirect tax.

...not sure but an direct tax is when you are taxed right then and there and you know about it ...a indirect tax is when you are taxed later on and don't know about it

The 16th Amendment prohibited congress from labeling the Federal Income tax a direct tax from whatever source derived. A direct tax is a tax on property. The Federal Income Tax is a tax on Activities . Specifically and in legal terms the subject of the Federal Income Tax are certain privilege activities, such as corporations, the manufacture of alcohol, tobacco, and firearms. All those activities that are taxable are properly indicated in title 26 (Internal Revenue Code). Title 26 does not contain a law such as this: "There shall be assessed, levied, collected, and paid annually upon the gains, profits, and income received in the preceding calendar year by every citizen of the United States . . . from any profession, trade, employment, or vocation carried on in the United States or elsewhere, or from any other source whatsoever, a tax" The Authority for congress to tax activities by an income tax comes from article 1 section 8 of the United States Constitution. All indirect taxes must be uniform. Indirect taxes do not need to be apportioned. There are only two cited direct taxes in the United States: Taxes on property and capitation taxes. There does not exist one single supreme court case, after the 16th Amendment, that defines the federal income tax as a direct tax.

difference b/w direct tax and indirect tax

These are direct taxes to the person who purchases the cigarettes. An indirect tax could be property tax paid by the cigarette manufacturer to the local government for the factory. This expense is figured into the cost of the cigarettes and is therefore an indirect tax to the purchaser of the cigarettes at a retail store. The local property tax is not paid by the buyer of the cigarettes but he does pay more for the cigarettes due to the tax paid by the manufacturer as well as income for the employees, power and all other expenses that go into the ultimate costs of the end product.

A direct tax is tax paid directly to the Government, by a person whom the tax is imposed on. An indirect tax is paid indirectly to the Government, trough a third party.A direct tax would be taxes like income taxes, where a person must personally pay a certain amount to the government. Indirect taxes are taxes such as property, social security, and sales tax, where there price of tax is either deducted from wages or added onto the payment of an item. The indirect taxes are paid the Government by the business that collects the tax.

It is difficult to classify it because some times it is direct tax while on other times it becomes indirect tax. If dividend tax is imposed on company itself then it is an example of indirect tax because the company can shift it towards market/ consumers by increasing the prices. Mostly dividend is paid to share holders. If dividend is distributed among share holders then definitely it increases their income, they will have to pay income tax i.e. it is direct tax. Now a days dividends are exempted from tax in order to motivate the companies to increase their production, income

ECO-WAS levy is a direct tax

sales tax is an indirect tax. the person paying the tax passes the incidence to another person.

Direct taxation is defined as the tax which is directly levied on the citizens of a country. All individuals and business concerns have to pay direct taxes to the government on a regular basis. These direct taxes are calculated on every source of income that accrues to the business of individual.On the other hand, the citizens of a country are charged certain levies indirectly as well. These indirect levies are known as indirect taxes. These are the taxes payable on an activity or a commodity. Some common examples of indirect taxes are sales tax and excise tax.

The federal personal income tax is an example of progressive tax.

Direct Taxes- Income tax, Wealth tax, Gift tax, Corporation taxThese taxes are considered as direct taxes because such taxes are borne by the person on whom it is imposed and the burden of such taxes cannot be shifted from the payer to the bearer.Indirect Taxes- Sales tax, Excise duties, Custom duties, Entertainment taxThese taxes are considered as indirect taxes because the burden of such taxes can be shifted from the payer to the bearer

A direct tax is a tax that is paid directly to the government by the person who is working. An indirect tax is when a person pays taxes to a store and then the store has to pay the taxes to the government.

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