Research federal, state and local income taxes.

Income taxes are administered at the federal, state and local levels. Whether you pay state or local income taxes depends on where you live and work.

• Federal income taxes are paid to the U.S. Treasury in support of federal government programs and services. Based on the notion that higher earners can afford to pay more in taxes than lower earners, the U.S. tax system is founded on a progressive system to allocate taxable income into different marginal rates. Marginal tax rates currently range from 10 percent to 37 percent, depending on your level of earning and filing status. Marginal tax rates do not take into account adjustments, deductions and exemptions.
• State income taxes are paid to your state government for state-funded programs and services. Forty-three states currently collect state income taxes, some at a single rate and others at graduated rates. Find your tax rate at the Department of Revenue for your state Links to an external site..
• Local income taxes are paid to a city, county or other jurisdiction to complement property, sales or other taxes used to bolster the revenues in that area. Rates vary, usually as a percentage of your income. Nonresidents working in the area may be subject to paying the tax.

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