An Overview of Personal Income Taxes
What you need to know to file and pay your taxes.
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With the possible exception of accountants, nobody likes taxes. But most of us recognize that our taxes are necessary to keep the country running, and pay for necessities like national security, infrastructure, education, food and drug safety, Social Security, Medicare, and so on.
As an individual, you're responsible for paying taxes on any income that you earn. In most cases, your employer will deduct your income from your paychecks, so you're not likely to owe much income tax at the end of the year. The important thing is to file a return on time, and to pay the taxes you owe by the deadline. If you can't, the IRS does offer payment plans, though it will charge you interest. Here are some questions about taxes that you may need answered.
Filing Tax Returns
- What if I can't meet the April 15 th deadline? (For information, see Filing and Paying Taxes Late.)
- What if I'm not having taxes withheld from all or some of my income? (For information, see Paying Estimated Taxes.)
- Are there certain "audit triggers" I should avoid? (For information, see How to Reduce the Chance of an Audit.)
- What should I do if I missed filing taxes one or more years? (For information, see Tax Returns: If You Haven't Filed in a While.)
- If I'm living outside the country, do I have to file a tax return? (For information, see Filing a Tax Return When You Live Outside the United States.)
Dealing With High Tax Bills
- What happens if I can't pay my tax bill? (For more information, see Tax Bill & IRS FAQ.)
- Can I pay the IRS the taxes owed in installments? (For more information, see IRS Installment Payment Plans.)
- Will the IRS settle for less money than I owe? (For more information, see Using an Offer in Compromise to Settle a Tax Bill.)
- What should I do if I'm contacted by an IRS collector? (For more information, see IRS Tax Bill Collections: What You Can Do.)
- Does it make sense to file for bankruptcy to deal with a tax bill? (For more information, see Eliminating Tax Debts in Bankruptcy.)
You may feel tempted to rebel against the system, but it isn't worth it. The IRS is especially good at hunting down scofflaws and holding on tenaciously. If you choose not to pay taxes, or if you cheat on your taxes, you risk getting caught and suffering the consequences -- which aren't pretty.
To Learn More
For secrets, tips, and insider information on how to deal with the IRS, get Stand Up to the IRS, by Federick Daily (Nolo).