英语翻译Thebasicstructureofthefederalincometaxissimple.Thetaxpayeraddsupallhistaxablesourcesofincome,subtractscertainallowabledeductionsandexemptionsforhimself,hiswife,children,andotherdcpendents,andthenappliesthet
英语翻译
Thebasicstructureofthefederalincometaxissimple.Thetaxpayeraddsupallhistaxablesourcesofincome,subtractscertainallowabledeductionsandexemptionsforhimself,hiswife,children,andotherdcpendents,andthenappliesthetaxratestothedifference.Butthisprocedurehasmanypitfallsforthetaxpayer,anddifficultquestionsoftaxpolicyariseatalmosteverystage.Consequently,itisimportanttounderstandthemainfeaturesoftheincometaxstructure.
AdjustedGrossIncomeandTaxableIncome
Thetwomajorconceptsofincomethatappearonthetaxreturnare:adjustedgrossincomeandtaxableincome.
Adjustedgrossincomeistheclosestapproachintaxlawtowhatalleconomistmightcall“totalincome.”Butitdepartsfromaneconomicdefinitionofincomeinsomeimportantrespects.Itrepresentsthetotalincomefromalltaxablesources,lesscertainexpensesincurredinearningthatincome.Ingeneral,onlymoneyincomeistreatedastaxable,butmanyitemsareexcluded.Suchexclusionsincludeone-halfofrealizedcapitalgainsonassetsheldsixmonthsormore,interestonstateandlocalgovernmentbonds,alltransferpayments(forexample,socialsecuritybenefitsandunemploymentcompensation),fringebenefitsreceivedbyemployeesfromtheiremployers(themostimportantofthesearecontributionstopensionplans),andincomeonsavingsthroughlifeinsurance.Theemphasisonmoneyincomeautomaticallyexcludesunrealizedcapitalgainsandsuchimputedincomeastherentalvalueofowner-occupiedhomes.
Adjustedgrossincomeisusedonthetaxreturnintwoways.First,itistheincomeconceptbuiltintothesimplifiedtaxtable,whichisusedfordeterminingtaxonmorethan25millionreturns.Second,itprovedesthebasisforplacinglimitsonsomeofthepersonaldeductionswhicharesubrtactedincomputingtaxableincome.
Taxableincomeiscomputedbymakingtwosetsofdeductionsfromadjustedgrossincome.Therirstarepersonalexpenditureswhichareallowedasdeductionsbylaw—charitablecontributions,interestpaid,state-localincome,generalsales,propertyandgasolinetaxes,medicalanddentalexpensesabove3percentofadjustedgrossincome,andcasualtyandtheftlossesabove$100foreachlo