There are two main ways for governments to collect taxes. One is by taxing income directly. This is known as an income tax. The other is taxing only income that is spent.
Currently, some types of income are either taxed at lower rates than ordinary income or are exempt from taxation to some degree.
In general, only cash income is subject to the income tax.
Tax credits and deductions are two ways to reduce tax liability. Tax credits directly reduce the amount of taxes owed, dollar-for-dollar.
The federal estate taxA tax based on the value of the estate of someone
State and local governments issue bonds to finance important projects that meet social goals and benefit communities.
Social Security benefits are paid through a self-financing system.
Social Security program administration has multiple functions. It processes applications and payments and operates field offices around the country.
Some proposals to address Social Security solvency would adjust the calculation of initial benefits. Others adjust benefit growth over time.