Income taxes are calculated and withheld on employee paychecks and are imposed by federal and state governments. See Taxes and rates: wage bases and limits for more information on calculation and rates.

Income tax terminologies

  • Income tax may be abbreviated as FIT (Federal Income Tax) or SIT (State Income Tax)
  • Income tax may also have been labeled as withholding tax (e.g., Federal Withholding Tax or FWT).