Income tax in the United States

**In the United States**, people have to pay **income taxes** to the United States government, most state governments, and many local governments.  This means that people have to pay taxes to these governments, based on how much money they earn.

## Introduction
Income taxes are based on what a person earns in one calendar year  between January 1 and December 31.

When it takes income taxes, the government takes a percentage of a person's income.  This percentage is called an income tax rate.  In other words, the income tax rate is the part, or , of a person's income that the government takes.

The United States government, and most states, use *progressive* tax rates.  This means that as a person earns more income, their income tax rate gets higher.  In other words, as a person earns more money, they have to pay more taxes.

Every year, the government divides incomes into categories.  These categories are called tax brackets.  Each tax bracket includes a range of incomes  the lowest and highest amounts a person could earn to be in that tax bracket.

Tax brackets are important because each one is taxed at a different tax rate.  In other words, a person in a higher income category has to pay a larger percentage of their income in taxes.  The tax rates for each different tax bracket are called marginal tax rates.

Sometimes people have other deductions that will add up to more than the standard deduction.  These can also be used to decrease the amount of income the government can tax a person on. 

#### Personal exemptions
The federal government allows each person who files taxes to take a tax deduction called a "personal exemption."  When the United States Congress created tax rules in 1954, they thought a certain amount of money should not be taxed so that a person could spend that money on food, housing, and other basic needs.  In 2015, the personal exemption for one person was $4,000.  Most people can take another exemption for their spouse, and another for each child in their home.

#### State deductions
Many states have their own deductions.  For example, if a person in Massachusetts pays rent to a landlord, they can deduct half of their rent (up to $3,000) from the amount of income the government can tax them on.

### Credits
The federal government also offers tax credits.  This means that if a person spends money on certain things, and meets all the rules of the credit program, the credit can be up to 35 percent of your qualifying expenses, depending upon your adjusted gross income.  For example, the Child and Dependent Care Credit is for parents who work, but have to pay over $3,000 a year for someone to take care of their children while they are working.  Each credit has many different rules that people must meet.  However, if they do meet them, the federal government will take $3,000 off of their taxes, to help the parents continue to work.

## Filing taxes
Every year, most people in the United States must file a report of their income from the year, their deductions, credits, and any other special tax issues.  This report is called a tax return. The tax return helps work out what a person might owe the government in taxes.  On the other hand, if a person has been paying their taxes bit by bit, the government may owe *them* money.  This is called a tax refund.

Usually, all tax returns are due by April 15.  However, because of holidays in Washington, D.C., sometimes "Tax Day" comes a few days later.

### Filing status
There are a five different ways that a person, or a couple, can file their tax returns:

#### Importance
Filing status is important because many things change based on what filing status a person files their taxes under.  For example:

File:Doctor uses a stethoscope to examine a young patient.JPEG|Federal income taxes help pay for poor children to get health care through Medicaid

File:Aircraft Rescue Firefighting training.jpg|They help pay soldiers like these Marine Corps firefighters

File:FBI Evidence Response Team.jpg|They help pay the FBI and other federal law enforcement agencies

File:RPG wounded Iraq veteran exercising Army-dot-mil-2007-02-07-103140.jpg|They pay for benefits for veterans like this Iraq War vet

File:ACID WATER, OIL AND ACID CLAY SLUDGE ARE EVIDENT IN THIS FIVE ACRE POND ALSO CLUTTERED WITH JUNKED CARS AND OTHER... - NARA - 555852.jpg|They pay for the EPA to clean up pollution like this 

## What state and local income taxes pay for
Every state gets to decide where to spend the income tax it collects (its income tax revenue).  Different states use this money for different things, at different times.

### Education and health care
In 2015, a report looked at what every state spent its income tax revenue on.  It found that most of state income tax dollars went to pay for education and health care.

Specifically, states spent over half of their income tax revenues on three different things:
* Public safety
** Police departments, and certain fire departments and emergency medical services
**  for these departments, like ambulances
** Salaries for police officers, firefighters, and Emergency Medical Technicians (EMTs)
* Trash collection and street lighting
* Free public libraries and public parks
* Paying the costs needed to keep the state government working, including paying the salaries of government workers

## Graphs

File:Income tax rate in develop nation.png|Graph showing how the United States's average income tax rates (in green) compare to other countries'
File:US Income Tax Rate.png|Graph showing how the tax rate for the highest income bracket has changed from 19132013
File:State and Local Income Tax in the United States.png|Graph showing average state income tax rates (in dark blue), and local tax rates in those states (in light blue) (2014)
File:Map of USA highlighting states with no income tax on wages.PNG|States with no personal income taxes

## Notes
## References
## Other websites
* The Internal Revenue Service (IRS)  Official website
** IRS Help and Resource Center 
** [Find Answers to Your Tax Questions  IRS Online Tax Assistant](https://www.irs.gov/uac/Interactive-Tax-Assistant-(ITA)-1)
** Get Free Help Filing Your Taxes
* Your Tax Receipt: Understand Where and How Your Tax Dollars Are Being Spent  (from WhiteHouse.gov  based on 2014 taxes)