The United States has several different types of taxes. The main ones to be aware of are sales tax, state income tax, and federal income tax. Other taxes, such as social security and Medicare taxes, only apply to a small number of international students.
Sales tax is applied to goods or services you purchase in the United States. For instance, if you purchase a shirt from a store or lunch from a restaurant, there will be a tax charge applied. The sales tax for Knoxville is 9.25 percent. We recommend that you do the math before making a purchase to make sure you are comfortable with the cost.
State income tax
State income tax is a percentage of money that you pay to the state government based on the income that you make in your job. This is typically taken out of your paycheck before you are paid. State income tax rates vary by state. Tennessee does not have state income tax, but if you work in another state for an internship or other job, you may have to pay state income tax.
Federal income tax
Federal income tax is a percentage of money that you pay to the federal government based on the income that you make in your job. This is typically taken out of your paycheck before you are paid.
Tax Deadline Update
The Internal Revenue Service (IRS) announced on Friday, March 20 that the tax deadline has been extended to July 15, 2020 instead of April 15, 2020. All tax documents must be postmarked by the July 15, 2020 date.