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Facts about Tax Refund in U.S. in 2018

The United States of America tax system is not complicated if you know exactly what to do and how to go about it. However, you need to understand certain things about the entire tax system and how it works. PDFelement has created an infographic to do justice to the whole workings of the U.S tax system. It tells you about the tax revenue and their sources and how the compare to other advanced economies all backed by adequate statistics and data. It also shows the steps on how to file a tax return and the deadlines around the tax filing exercise.

The essence of tax is to provide the government with adequate funds to provide goods and services to the public and this is collected by the Internal Revenue Service for the government of the United States. Tax refund arises when the tax paid is higher than the tax liability for that tax season. The US received about $3.46 trillion in tax revenue from different sources in 2017, the highest since 2013. The largest percentage of this revenue comes from income taxes and closely followed by payroll taxes which make up to more than 80% of revenues. Other sources include corporate taxes, estate taxes, custom excise taxes and the federal reserve net all together contribute 15 to 20% of the total revenue of the US government. The tax revenue continues to rise and it is expected to hit about $3.6 trillion according to the 2018 forecast. When the total tax revenue is compared to percentage of GDP, the US surprising ranks lower than a lot of advanced economies.

Filing a tax refund happens yearly and April 17th 2018 is the deadline for this year for filing federal income tax returns. However, filing a tax return should not be difficult with the right steps and this infographic provides the 11 steps required to successfully file a tax refund. At the end, Americans get their tax refund and have the choice to use them for anything they like. In fact, survey shows that a lot of Americans use their tax refund for debt payment and savings.

This infographic is very rich in content and puts the whole tax system of the United States into context with statistically backed figures. At the end, you will understand how the tax system works and how to file your tax return at a glance.

This infographic will comprehensively present key facts about the U.S. Tax.

infographic truths about filing tax in US 

How to file tax in United States:

1. Gather your tax forms and paperwork:  Make sure you have all the IRS forms you need to file. This includes your W-2 form and other income statements. You may also need proof of health insurance coverage to complete your return. Gather all your supporting documents, such as earning statements, interest statements, and receipts for charitable donations. Keep organized records to make the process easier and help avoid issues with your return.

2. Determine your filing status : Your marital status and how much your household members pay towards keeping up a home can help you figure out your correct filing status.

3. See if you qualify for free tax return preparation: The IRS offers free tax help to low-income individuals, military servicemembers and their families, persons with disabilities, the elderly, or taxpayers with limited English.

4. Choose the simplest form for your tax situation: Determine the correct form to use to file your return. If you file your return using IRS e-file, the system will automatically decide which form you need.

5. Figure your taxes and credits: Add up your sources of income, such as your salary, interest earned from your banking or investment accounts, and your pension or retirement-related accounts. Check to see if you are eligible for credits and deductions, including charitable contributions, education, and child care expenses.

6. Claim your dependents and exemptions: It's important to understand the rules on claiming dependents (a qualifying child or relative) and exemptions (deductions from you and your dependents' taxable income).

7. Determine if you need to pay quarterly estimated taxes: Find out if you need to pay taxes on income that is not subject to withholding, such as self-employment, interest, and dividends.

8. File your taxes online or mail your paper tax return: Choose the filing method that best suits your needs: online, a mailed paper return, or through a tax professional.

9. Check your IRS refund status: Use the IRS Online Tool or download the IRS2Go App.

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