Paying taxes is something that most Americans dread each year. Most people think that taxes are something that we are only required to pay or file once a year but in reality we pay taxes every day. These taxes come in many forms and can add up overtime making it important to become aware of any existing exemptions or reductions on taxes.
The state tax law in Indiana covers most items that are needed every day. Any clothes you buy for your children or school supplies you get for them throughout the year are taxed at 7%. This means no matter how much you spend you can expect to spend an additional 7% just to help the government out. Luckily there are two items that are totally exempt from sales tax and these items are food and drugs.
While many people wish that other items were exempt from sales tax quite a few are happy to be freed from these two additional expenses. Purchasing food is something that the average family does at least once a month and when you spend $400.00 month on groceries the additional seven per cent you have to pay in taxes can really start to add up. Also, if you are someone that is sick or has a chronically ill family member, paying for prescription drugs each month can also get to be expensive. Avoiding seven per cent in these two situations is something that everyone in Indiana should be thankful for.
The state of Illinois and certain counties collect taxes on income each year. There are some welcome exemptions and reductions available to all people. Single and married people plus their dependents are legally able to receive an exemption of a certain set amount ranging from $1,000 to $2,000. Certain forms of income such as social security are also completely exempt from income taxes. Veteran compensation pays are also exempt from state taxes. Some counties also have additional exemptions and the county tax offices must be contacted for details.
The state taxation laws in Illinois also extend to property. The property taxes are controlled by counties with the state overseeing all activity. Homeowners are able to receive a credit for property taxes for approximately ten per cent of their liability. There is another deduction available to anyone who receives the credit and this deduction is usually one-half of the assessed value of the home. If a person receiving the credit and deduction passes away their spouse might be eligible to receive it.