human
Can you explain how the US tax system works?
assistant
The US tax system is an income-based system which requires individuals to submit an annual tax return to the Internal Revenue Service, or IRS. All US citizens, residents, and non-residents must report their income and other taxes such as payroll taxes, sales taxes, estate and inheritance taxes, and capital gains taxes. Depending on their income level and filing status, US taxpayers may be eligible to claim credits, deductions, and other incentives which can lower the total amount of taxes owed. Generally, US taxpayers must calculate their taxable income by subtracting their deductions from their gross income. Finally, the total tax owed is calculated by multiplying the taxpayer's taxable income by the applicable tax rate. Depending on the amount of taxes owed, US taxpayers may be required to pay estimated taxes throughout the year. Payment of these taxes is often done through online payment platforms, mail, or in-person.