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WHAT TYPE OF A TAX IS A INCOME TAX?
Income Tax is an Indirect Excise Tax. Congress has imposed the tax on 3 classes of persons which are NON-Resident Aliens, Foreign Corporations deriving US Domestic source income and US Citizens residing abroad with foreign earned income. The term "US Person" denotes an US entity that has control, receipt, custody, disposal, or payment of any item of income of a foreign person that is subject to withholding. From IRS.GOV "You are a withholding agent if you are a U.S. or foreign person that has control, receipt, custody, disposal, or payment of any item of income of a foreign person that is subject to withholding."
Is a retired person's income subject to Social Security taxes?
According to IRS publication 54 (2007), pensions are "unearned income" and thus in the same category as capital gains, dividends and interest income. Withholding tax is not assessed on pensions, capital gains, dividends and interest.
What is the difference between taxable and tax-exempt bonds?
Taxable bonds are subject to federal income tax on the interest earned, while tax-exempt bonds are not subject to federal income tax on the interest earned.
Withholding tax rates on interest payment?
When you dont give bank etc. your tax file number they end up withholding tax of about 45%, but dont worry you can claim back the correct amount at the end of the year on your income tax return - you just have to write down the amount of interest you earned under the section that states "tax withheld."
What is the formula for times interest earned ratio?
Times Interest Earned = Operating Income/ Interest Expense.
Interest earned on interest is known as?
Compound Interest
Do UK banks automatically deduct basit rate tax from fixed deposit interest?
Yes, UK banks automatically deduct basic rate tax from fixed deposit interest payments. This means that the interest earned is subject to a 20% tax withholding for individuals who are within the basic rate tax band. However, due to the Personal Savings Allowance, some savers may not owe tax on their interest if it falls within the allowance limits. It's important for account holders to check their tax status and entitlements.
Do you pay taxes on a certificate of deposit (CD)?
Yes, interest earned on a certificate of deposit (CD) is subject to taxation as income.
Compound interest is interest paid on interest previously earned?
yes
Is foreign earned income reported on state tax returns?
No, it is not. Also, Did you know there is an online test you can take that determines your eligibility for the foreign earned income exclusion? (Click on the link to take the test): <a href="http://taxplannercpa.com/foreign-earned-income-exclusion-eligilibility.php">Foreign earned income exclusion</a>
How is interest different from compound interest?
Simple interest is interest paid on the original principle only, Compound interest is the interest earned not only on the original principal, but also on all interests earned previously.
Does cooperative society pay withholding tax?
A Cooperative Society does not pay withholding taxes. Withholding taxes are taxes deducted at source from incomes earned by individuals and corporate bodies that are subject to payment of taxes. The taxess so withheld are subsequently deducted from the final tax liabilities of such individuals/corporate bodies. Since Cooperative Societies do not pay taxes on theirprofits it will beimpossible to deduct such withheld taxes and so the Cooperative suffers.
