The U.S. tax system can be rather confusing to the untrained eye, or brain for that matter. Maybe it is because of its separate city, state, and federal tax brackets. Everyone has to file taxes, annually, and the IRS provides help and support with filling out the proper forms whether online or by mail. Employers MUST mail out W-2’s to all employees by the end of January. A “W-2” document lists an employee’s annual gross and net earnings for the year. A copy of this form is also sent to the IRS for their record. All tax returns must be filed by April 15th, unless an extension has been granted by IRS. The IRS provides helpful handbooks that are mailed to every household. Additional handbooks can be picked up from libraries and/or post offices.
Most “simple” tax returns can be filed online. The more complicated returns, such as for the self-employed (1099), and others, may need the additional assistance of an accountant or tax service, such as H&R Block.
Expats are taxed like everyone else in the USA but most countries have formed a partnership with the USA to avoid double taxation.
The 2011 Federal income tax brackets for a single person are as follows:
- 10%: from $0 to $8,500
- 15%: from $8,501 to $34,500
- 25%: from $34,501 to $83,600
- 28%: from $83,601 to $174,400
- 33%: from $174,401 to $379,150
- 35%: over $379,150
Local government taxes are different from state to state, sales tax and property tax included. For sales tax, remember that the price you see in a shop or in a restaurant is the price BEFORE sales tax is added. California has the highest sales tax in the union at 9.25% with additional Los Angeles taxes hiking it up to around 10.25%.
The IRS has detailed information on which tax return to file, and other major information needed to properly file your return online: http://www.irs.gov/individuals/index.html
The annual property tax bill is mailed out every November. Property tax information can be found on the L.A. County website: http://www.lacountypropertytax.com