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A tax is a charge levied the government on citizens, corporations, or other legal entities. A tax is typically assessed on the following:

- Income (salaried income found on W-2, self-employment income, etc.)
- Assets (i.e. capital gains on investments, etc.)
- Products, upon its purchase or sale (i.e. consumer goods, house, etc.)

Governments use various forms of a tax to raise the revenues needed to fund public expenditures such as defense costs, capital expenditures (i.e. highways), and social programs. A tax can be assessed at the federal level, at the state level, and at the local level. In the US, the federal government depends mostly on the income tax to fund its budget. The federal government uses a graduated income tax system whereby different tax rates apply at different levels of taxable income. Federal taxes are collected and enforced by the Internal Revenue Services (IRS). At the state level, some states use a flat rate tax and others use a graduated income tax. Although a few states don't impose an income tax on its residents, most state governments use income tax as well as a sales tax to raise revenues. Some states also levy a use tax on its residents to be applied to the costs of goods purchased outside the state (i.e online purchases). At the local level, county and city government will levy property tax and sometimes a school tax to raise revenues.

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