Is it true if your income is low enough, you don't pay any federal income tax? I've always heard that there are a large group of Americans who aren't required to pay any federal taxes, and that the top five percential pay over 50% of all federal taxes. But looking at these tax tables, I noticed that all income levels are taxed at about at leat 10%. Can anyone clear this up please?
2007-04-10 10:43:10 · 3 answers · asked by diamond_kursed 4 in Business & Finance ➔ Taxes ➔ United States
The tax table is based on TAXABLE income. That is income AFTER deductions and personal exemptions. The standard deduction is $5150 for a single and $10300 for married filing jointly. Personal exemptions are $3300 per person. Some lower income earners are eligible for the EIC which is a 'refundable credit' that means you can receive a refund larger than your withholding. I recently saw an article that claimed the net taxes paid by people earning $40,000 or less is ZERO. for every dollar paid by people under that income a dollar in 'refunded' though the EIC.
The link below is the IRS tax statistics page. Have fun exploring.
2007-04-10 13:49:48 · answer #1 · answered by STEVEN F 7 · 1⤊ 0⤋
True with kids your income low you get extra money from the irs. The taxable income is after deductions yourself, wife, dependents
2007-04-10 17:51:57 · answer #2 · answered by retired_afmil 6 · 0⤊ 0⤋
if your income is low enough and you have a couple of kids,, you can actually get money back that you didn't pay in,, a lot of money.
many people don't pay taxes at all...
the tax tables you are looking at is for taxable income, that is after all deductions and exemptions are deducted from adjusted gross income.
2007-04-10 18:29:52 · answer #3 · answered by Jo Blo 6 · 0⤊ 1⤋