Every year, tax time rolls around, whether you are ready, or not. Some people detest filling out all of the required tax forms. Income tax forms must be filed each year, if you have earned a certain amount of money.
Tax Forms will require you claim income from all sources. This includes money you earned from an employer, or as an independent contractor. You also need to claim any earnings from interest, capital gains, or other sources.
Normally, you will receive your tax forms in the mail if you have filed income tax returns in prior years. If you are self employed, have a new job, or have relocated, you may need to find the necessary tax forms online. You can also find these forms at your local federal revenue outlet. Talk to your accounting or human resources department at work if you have tax questions.
Certain earnings will qualify as exclusions. This can include interest from certain investments and bonds that are exempt from taxes. If your employer pays health insurance on your behalf, you will not have to pay tax on this benefit.
There are a number of tax forms to fill out to claim deductions such as moving expenses, business deductions or alimony. Medical expenses and charitable donations can also decrease the amount of taxes you will have to pay.
The percentage of your income due in tax will depend on your income level. Tax brackets range from 10 per cent for low income earners, to up to 35 per cent for people who earn hundreds of thousands of dollars. Everyone is allowed a personal tax exemption. You can earn this amount of money tax-free. You will also need to fill out forms to claim deductions for dependents such as your spouse or children.
If you experienced capital gains and losses, you will also have to file an income tax form. Generally, you will acquire capital gains through the sale of investment property. The amount of time you hold the property will help determine the level of tax. If you are married, you will likely need to file a joint tax return, which effectively treats your partnership as a single return.