Taxation

Fee Simple TaxationTaxation is a government entity that rules fee simple. Every property owner must pay taxes on the federal and state level. Taxes consist of direct and indirect taxes and must be paid in the form of money. A tax is an enforced payment by the government.

Taxation has four main purposes also called the four R’s. Revenue, Redistribution, Repricing, and Representation. Revenue is the taxes paid that help certain government or state systems such as building roads, helping to pay for schools or hospitals, or helping to pay for government systems. Redistribution is the means of transferring revenue from the richer sections to the poorer sections. Taxes are also used as a means of repricing. Repricing is taxing certain goods to help discourage the use of them. One example of repricing is the tax on tobacco. The last R is representation. This was put in place to help representative parties become accountable for their taxes. Depending on the state, that you live in tax rates may be different. Tax rates are also calculated by amount of income.

Corporate taxation refers to the tax that is placed on a particular corporation that is calculated by the corporation’s profits. Many companies have shareholders who help to offset that corporations tax expenditures. Depending on the country, the corporation taxes may be different for the company itself as well as for the shareholders. In Austria and Germany, the tax rate is halved. In the Netherlands, certain distributions are exempt from tax. In Canada, shareholders may get a tax credit.

Investment taxation is used when someone may invest in a company also called a shareholder, or if a person has investment properties. Investment properties can be difficult for calculating how many taxes that you have to pay. There are certain things that you can and cannot deduct, but if circumstances change, you may be able to deduct them later. When handling an investment property that is when it is important to possibly hire a property manager to keep all of your expenses in line for tax purposes. There are many tax services out there to help with all of your tax needs. They will help you in most cases get the best return possible for your property.