What is income tax?
In US the federal, most states and local governments impose tax on income. The income tax is calculated by applying the tax rates, which normally increase as income increases. Income generated by Individuals, companies, nonprofit organization and trusts are directly taxable based on the Tax rated defined by the Federal Government. For US citizen or a resident alien of the US and lives abroad, the worldwide income is taxable. Married couples may calculate income tax as a couple or individually. Individuals and corporations must file income tax returns in each year on their income.