What countries have a flat tax1/31/2024 100% Accurate Calculations Guarantee – Individual Returns: If you pay an IRS or state penalty or interest because of a TurboTax calculation error, we'll pay you the penalty and interest. Whichever way you choose, get your maximum refund guaranteed. Just answer simple questions, and we’ll guide you through filing your taxes with confidence. Or you can get your taxes done right, with experts by your side with TurboTax Live Assisted.įile your own taxes with confidence using TurboTax. Let an expert do your taxes for you, start to finish with TurboTax Live Full Service. But under a flat tax system, both would pay the same exact amount of tax. This means that two tax payers that earn the same salary for the year may end up paying different amounts of tax. Usually for behaviors the government wants to encourage, like buying a home or donating to charity. However, unlike the flat tax, progressive systems allow you to reduce your taxes with credits, deductions, and exemptions. The next 25,625 dollars is taxed at 15 percent, and the remaining 56,775 dollars is taxed at 25 percent. If you are a single taxpayer who earns 90,775 dollars during 2010, the first 8,375 dollars of income is taxed at ten percent. This means that as your income increases, so does the amount of tax you have to pay.Ĭurrently there six tax brackets that range from ten to 35 percent. Here in the US, we use what is called a progressive system. Some people argue the system is more fair while others say it places an undue burden on people with lower incomes. The jury is still out on whether this is a better way to collect tax. Generally, a flat tax system requires you to pay a fixed percentage of your income to the government, regardless of how much you earn, how many people you support, or the amount of personal expenses you have. Hello, I'm Sara from TurboTax with some information about how a flat tax system works.Īlthough the US does not use any type of flat tax, more than 20 countries, mainly in eastern Europe collect taxes this way.
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