Income tax is charged to both people and businesses alike. In either case it is calculated on the amount of money that the business or person makes. In the Unites States of America, the tax system is based on a progressive scale. It simply means that the more you make the higher percentage that you have to pay. The highest rate is 38% while the lowest is 0%. The guidelines for 2016 earned income tax credit table were recently liberalized; therefore many more families meet the requirements and can claim the credit. If you spare an ample time checking these conditions, the results can be worth the efforts. If your income is under $39, 783, this tax credit is very useful for you.A tax credit is always good because it puts money in your pocket and reduces the amount of tax you pay. In most cases, people and business are treated very similar in the eyes of tax law. If a business does not earn much money, then its tax liability will be less than one that might earn millions. The progressive tax system was created as a way to be fair to all people. The idea is if you are not making enough money to live off, then you should not be liable to pay income tax. On the other side, if you are making hundreds of thousands of dollars a year then you are more able to pay taxes that others cannot.
Checking your Eligibility for EIC
Earned income credit amount 2016 has no effect on certain welfare benefits like supplemental security income, Medicaid and food stamps. People who are eligible for EIC generally don’t have cash to hire a consultant and they are unable to claim EIC on their own due to its complicated criteria. However IRS offers an online program to help these people. So just check the eligibility criteria and you may be able to fit in yourself.Fortunately, affordable tax companies are starting to pop up all over the country. They will help walk you through what you owe, how much you made, and what deductions are open to you. Even though they charge a fee, they can often save you enough money in deductions that it will be worth in the end. It should be noted that income tax laws vary from country to country. It is always a good idea to seek the opinion of a professional before submitting your tax returns.