6 Taxes You May Not Know You’re Paying
Tax season is over and you may not think about taxes until it’s time to file next season, but did you know there are myriad of other taxes that are not just on your tax return?
Most of us don’t think about that, but those taxes may tap into our wallets nonetheless. Here are just a few.
1. Sales Tax - Unless you live in a state that has no sales tax, you pay this one every day on most of the things you buy. Even goods purchased online are increasingly subject to sales tax.
2. Sin Tax – Oh wow, there’s a tax on sinners? Well, sort of. The two major taxes dubbed “sin taxes” are alcohol tax and cigarette tax. Every time you take a drink or light up, you are paying a tax that is hidden in the cost of the cigarettes and alcohol you buy. The tax is meant to deter people from indulging in these habits and to help the government pay for the cost of illnesses caused by smoking and alcoholism.
3. Social Security Tax and Medicare Tax - If you are employed, these taxes are taken out of each of your paycheck, so most people don’t really notice them. If you’re self-employed, these taxes show up on your tax return as self-employment tax.
4. Telephone Tax - Did you ever have to pay a luxury tax when you played Monopoly ? The telephone tax is one of those taxes, though telephones have now become a necessity, not a luxury. Originally imposed on landline telephones, it now applies to cell phones as well. And if you have cable television, you’ll find special taxes on your cable bill as well.
5. Gas Tax - As if gasoline prices weren’t high enough on their own, the state and federal government build in an average of 49 cents per gallon into the price of each gallon. Next time you are filling up, check out the sticker on the pump that lists what makes up the cost of each gallon – you’ll be amazed.
6. Utility Tax - Check your utility bills for various taxes imposed on gas, water and electricity. That will make you remember to turn out the lights each time you leave the room.
Knowing about these taxes may help you take control of your spending habits and cut down some of your expenses to reduce some of these unknown taxes.