When it comes to the imposition of income tax, it is important that the taxpayers pay equally, not based on absolute figures but rather based on their capacity to pay their obligations. Tax can be very confusing which is why people often employ the services of an affordable tax attorney in Orlando.
The income tax, much more than any other type of taxes being levied on the taxpayers, seeks to differentiate its burden according to the circumstances of the taxpayers, or in other words, based on their income that they earn on a certain period of time. Considerations being included on the imposition of this tax are the source of his income, the number of people that depends on his income for living, the medical expenses that they incur, and in some cases, his age [for instance, if over 65 years]. The devices that the income tax employs to make distinctions are exclusions from gross income, personal exemption, deductions of non-business expenditures, credits against tax, and graduation of the tax rates. The price of these refinements is a relatively narrow base to tax; in the United States the next annual income tax base often has included less than half of personal income.
In the income tax system of the United States, incomes are not generally distinguished according to source. In the traditional British system, which is copied by some of the Commonwealth countries, much has been made of the contention that so-called earned income [from services rendered, as by a wage earner] is not so potent, dollar for dollar, as unearned income [from property owned]. Service income is dependent on the uncertain tenure of life and working ability. Accordingly, income tax laws have sometimes provided abatement for service income. Some countries go much further than this, starting with separate schedules of income from different sources and adding a “supertax,”, or in other words, an aggregate income of taxpayers, with graduation confined mainly to the later tax.
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