OK as this board is quite well informed many of you may know this however, for those who are interested I wanted to give you this update.
1. Medicare tax: The amount withheld by your employer from your paycheck (often under the line item "FICA," which stands for Federal Insurance Contributions Act) helps cover the cost of running the Medicare program, the federal system of health insurance for people over the age of 65. Employers pay one half of the FICA tax and employees pay the other half. The employee contribution is 6.2 percent for Social Security and 1.45 percent for Medicare on wages up to $110,100. The temporary payroll tax cut for tax years 2011 and 2012 reduced the employee portion for Social Security by 2 percent but... Whoa its back on as last pay check.
2. Self-employment tax: A Social Security and Medicare tax for individuals who work for themselves. It is similar to the Social Security and Medicare taxes withheld from the pay of most wage earners. The self-employment tax consists of two parts: 12.4 percent for Social Security and 2.9 percent for Medicare (hospital insurance) on income up to $110,100. However, the temporary payroll tax cut for tax years 2011 and 2012 reduced self-employment tax by 2 percent. You can deduct the employer-equivalent portion of your self-employment tax in figuring your adjusted gross income. This deduction only affects your income tax. It does not affect either your net earnings from self-employment or your self-employment tax.
3. Alternative minimum tax (AMT): The alternative minimum tax was created in 1969 to ensure that wealthy taxpayers pay at least some minimum amount of federal income tax, regardless of deductions, credits or exemptions. In essence, it is a flat tax with two brackets, 26 percent and 28 percent. The problem with AMT is that it now ensnares not only the wealthiest Americans, but 4 million to 5 million taxpayers with annual incomes between $200,000 and $1 million. Congress has yet to approve a new inflation "patch" that would allow millions to escape AMT (the last patch expired in December). If a new one is not enacted, the AMT will hit 31 million taxpayers this year, reaching deeply into the middle class.
The utility taxes that Americans pay can add up quickly, as do the so-called "sin taxes" on alcohol and tobacco products.
4. Electricity or natural gas tax: A tax collected by energy suppliers based on consumption during the billing period.
5. Cable tax: Tax imposed on cable television subscribers.
6. Landline phone tax: Federal and state tax associated with use of a fixed phone line.
7. Cellphone tax: Federal and state tax imposed on mobile telephone users.
8. Federal and state gasoline tax: A tax on every gallon of gasoline sold, which account for 11 percent of the cost of a gallon of gas, according to the Energy Information Administration. Federal excise taxes are 18.4 cents per gallon and state excise taxes average 23.44 cents per gallon.
9. Cigarette tax: The tax on cigarette use varies from state to state. New York City has the highest rate, charging $4.35 per package of 20 cigarettes on the state level, plus an additional local excise tax of $1.50 per package of 20 cigarettes, bringing the combined tax rate in New York City to $5.85.
10. State alcohol tax: The tax imposed on the purchase of beer, wine and spirits varies state by state. The highest rate for spirits can be found in Washington and the highest for beer is Alaska. Wyoming has the lowest rate.