Welcome to our first edition of FUN FACT FRIDAY where we bring you the random, the fun, and the factual. Every Friday, we’ll be sharing some of our favorite tax facts. Get ready to be pleasantly surprised!
1 – The IRS will award you up 30% of the amount of money collected for blowing the whistle on taxpayers who fail to pay the tax that they owe. Before you begin spending away your winnings though, don’t forget to include this award amount on your tax return!
2 – Even criminals need to pay taxes. The IRS taxes stolen property and income from illegal activities. After years of leading the crime ring in Chicago, legendary crime boss Alfonse Capone was finally put behind bars for none other than tax evasion.
3 – If you thought getting taxed once was painful enough, investors in corporations get taxed twice–once at the corporate level for company earnings and then again at the individual level from dividends.
4 – Seven states do not have income taxes: Alaska, Florida, Neveda, South Dakota, Texas, Washington & Wyoming. Additionally, Tennessee & New Hampshire do not tax earned income.
5 – You might have heard that the United States operates under a voluntary tax system. But contrary to common misconception, it is not the payment of taxes that’s voluntary (darn!), but the calculation of taxes (say what?!). Taxpayers are expected to voluntarily comply with the tax code by reporting their taxes to the government (aka the IRS) and paying their respective liabilities.