The US tax system can look quite daunting because of its separate city, state, and federal tax system. Everyone has to file their annual taxes and the IRS provides help and support in filling out your tax return whether you are filing online or by mail. The tax year runs from January 1st to December 31st.
When you begin employment, you will be required to fill in a W-4 form that will help the employer withhold your estimated taxes. These are withheld from every pay check for the State and Federal income taxes. Employers will then send out W-2’s to all employees in January and February. A W-2 lists an employee’s annual gross and net earnings, a copy is also sent to the IRS. Individuals must file by April 15th and work out their own tax return (if one is due) from one of the helpful IRS handbooks or the website (http://www.irs.gov/). Additional handbooks can be picked up from libraries and post offices.
Simple tax returns can be filed online. More complicated returns, such as for the self-employed, may need the additional help of an accountant. If you have paid more tax in the year than necessary and are eligible to receive a refund through direct deposit, allow 2 weeks or so. If you request paper checks, allow 3 weeks to arrive.
Expats are taxed like everyone else in the USA but most countries have formed a partnership with the USA to insure that their expats are not taxed twice. Be sure to consult your human resources department to understand the implications of your taxibility in America and/or your home country.
The 2011 Federal income tax brackets are as follows:
Single
10%: $0 – $8,500
15%: $8,500 – $34,500
25%: $34,500 – $83,600
28%: $83,600 – $174,400
33%: $174,400 – $379,150
35%: $379,150+
Married Filing Jointly
10%: $0 – $17,000
15%: $17,000 – $69,000
25%: $69,000 – $139,500
28%: $139,500 – $212,300
33%: $212,300 – $379,150
35%: 379,150+
