Individuals, corporations, and other civil bodies are subject to the federal income tax, which is a tax on taxable profits. Federal income tax applies to all earnings, pensions, cash prizes from employees, corporate income, tips, poker income, incentives, and unemployment insurance. The federal income tax is the government's most important source of taxation. Except for Washington, Florida, Nevada, Alaska, Texas, South Dakota, and Wyoming, states withhold federal and state income taxes. State income tax rates differ from one state to another.
Federal taxes paid by employee(s) are used by the government to provide goods and services to civilians, invest in technology and education, and also in,