Different types of taxes

Taxes are money paid by citizens and residents to federal, state, and local governments. The money collected from these taxes help fund or support services provided by the government. It is the one of the main sources of government revenue. Taxes paid by an individual include income tax, sales tax, and property tax. Income Tax is paid on a federal level and in few cases to state or local governments as well. "Taxable income" is primarily money obtained through wages, self-employment, and from things like sale of property. The large majority of people pay their income taxes by having the money deducted from their paychecks. Income tax rates are generally lower for those who earn less money. Social security and Healthcare (Medicare) taxes are usually deducted from paycheck.

Social security benefits are granted to retired workers and their families, for disabled workers and their families and for certain family members of expired workers. Medicare (healthcare) taxes provide financial aid for medical services (this is applicable for people aged 65 and above). Sales taxes are more or less state or local taxes and usually added to the buying cost of certain things. These taxes will be based on the cost of items and help in funding for services provided by state and local government, such as roads, police, and firefighters. Property taxes are also state and local taxes that are charged on your home and land and contribute to funding of local public schools and other services in the area. Taxes improve our overall quality of life.