Brief Definition
The Internal Revenue Code (IRC) is the comprehensive set of tax laws created by the United States Congress. It governs federal tax administration, including income tax, estate tax, gift tax, employment tax, and excise tax.
Further Explanation
The Internal Revenue Code (IRC) is the comprehensive set of tax laws created by the United States Congress. It governs federal tax administration, including income tax, estate tax, gift tax, employment tax, and excise tax. The IRC provides the legal framework for how taxes are calculated, collected, and enforced. It is regularly updated and amended to address changes in the economy, policy priorities, and court rulings.
Example:
The IRC specifies how much individuals and businesses owe in taxes based on their income and other factors. For instance, the IRC outlines the tax brackets that determine the percentage of income individuals must pay in taxes. If you earn $50,000 a year, the IRC will tell you how much of that income falls into different tax brackets and how much you owe in total federal taxes.