States may impose a tax on the sale of goods and services. Rates may vary by county. Typically you pay sales tax when you purchase goods or services.
Exclusions and Exemptions
Exclusions in sales tax often include food, clothing, medicine, newspapers, and utilities. In addition, certain groups are often exempt from paying sales tax. Charitable, religious, and educational groups are often excused under certain conditions.
Many states also have a use tax. Similar to a sales tax, a use tax is imposed for the storage, use, or purchase of personal property that is not covered by sales tax. Typically this applies to lease and rental transactions or to major items purchased outside of the state, such as automobiles.
Sales and Use Tax Resources
Learn more about sales and use tax, including state sales tax rates and other important information:
Property taxes are typically levied by your state or local government. However, your state establishes the guidelines under which local government can impose property taxes. Each of the 50 states has its own criteria for what property is taxable.
Some states allow local communities to tax real property. This includes land and items that are permanently attached to the land. Real property includes homes, factories, wharves, and condominiums.
States can also permit local governments to tax personal property. This consists of property that is movable, such as boats, cars, jewelry, airplanes, computer, equipment, tools, and furniture.
The amount of tax to be paid is figured on the total value of the property or on a certain percentage of the value.
In addition to the federal government, 43 states and many local municipalities require their residents to pay a personal income tax. Generally, states use one of two methods to determine income tax: the graduated income tax or the flat rate income tax. Both methods first require you to figure your taxable income.
State and Local Personal Income Tax Resources
To learn more about state and local personal income tax:
Your State Taxpayer Advocate helps protect your rights, privacy, and property during the assessment and collection of taxes. Contact your state department of revenue to find out your rights and whether you have a taxpayer advocate or ombudsman.