is there anyone know that how many percentage of tax we should pay for the interest we earn from the bank?
2007-09-23 14:31:33 · 4 answers · asked by alex4travel 1 in Business & Finance ➔ Taxes ➔ United States
Interest income is your ordinary income. It is unearned income so it is not subject to social security and medicare taxes. You will pay federal tax and state tax on this income. Generally, you report all of your taxable interest income on Form 1040, line 8a; Form 1040A, line 8a; or Form 1040EZ, line 2.
About how much provision you should make to pay the taxes on interest income depends upon your maximum tax rate. For example for a Single the taxable income between $7,825 and $31,850 is taxed at 15% (federal tax). And income between $31,850 and $77,100 is taxed at 25%.
2007-09-23 20:02:33 · answer #1 · answered by MukatA 6 · 2⤊ 0⤋
Unless you are filing as a nonresident (in which the bank -and only bank -interest would be exempt), it will be taxed at your marginal rate - which is based off of your overall taxable income.
2007-09-23 15:26:19 · answer #2 · answered by IlDeluXeIl 2 · 1⤊ 0⤋
10%-35% depending on your marginal tax rate.
2007-09-23 15:23:13 · answer #3 · answered by Wayne Z 7 · 0⤊ 0⤋
Whatever your tax bracket is - from zero to 35%.
2007-09-23 15:42:38 · answer #4 · answered by Judy 7 · 0⤊ 0⤋