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Instructions For the Fair Tax Calculatorupdated 2/28/15
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The Fair Tax calculator is based on the information in HR 25 as presented in the House of Representatives in the 114th Congress. It should probably be called the the Fair Tax estimator as the tax you will pay will be based on how much you spend. Everyone's spending habits vary from year to year, the user can only estimate how much money they will actually spend in a typical year. Most people only know the following criteria for sure, 1) how many people are supported from their income in their household, 2) what their total income is for a year or what it should be 3) if they have designated savings coming out of their income that they do not touch 4) if and how much they will withdraw from a retirement account to supplement their income 5) how much cash donations are planned from the total income and 6) if and how much state and local taxes they owe.
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The estimator uses these figures to estimate how much federal sales tax you would pay if you spend everything that is left after deducting your savings and donations from your income. Another way to put it is the amount in cell D7 should equal the amount of money your household spends in a typical year based on the total income you entered in cell A9. Further instructions are below. For comparison purposes the results should be compared to the income and FICA taxes YOU paid in 2013.
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1) If you are using Microsoft's Excel, you are asked if you want to enable macros when you open the spreadsheet. If you chose disable macros, the only difference will be that the Reset Input Values button will not work. The button will not work with most other spreadsheet programs.
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2) The only cells that allow any change in their contents are cells B4, A7, B7, C7, D7 and A9 in bold blue and with a blue border.
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3) In cell B4, select the number of people in your household. The calculator/estimator only supports families up to 6.
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4) If you plan to supplement your available spendable income with a withdrawal from a retirement account, enter that amount in cell A7.
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5) Enter Enter the amount you plan to save this tax year out of your total income in cell B7
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6) If you plan to make any cash donations from your income for the tax year, input that amount into cell C7
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7) If you will have to pay any state, count, city or local taxes excluding any sales taxes, enter that amount into cell D7
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8) Enter your total income from all sources in cell A9.
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For example, let's say you typically save $5,000, donate $3,000, pay $2,000 in state and local taxes and have a total income from all sources of $50,000 then the amount you should enter $5,000 in cell B7, $3,000 in cell C7 and $2,000 in cell D7 leaving $40,000 the amount in cell F7 the actual amount you would have available to spend in a year based on your total income in cell A9 ($50,000). The bottom line here is cell F7 should be the amount of money you would actually spend of your total income. This is necessary because the tax is based on how much money you spend and not on how much money you make. If you make a withdrawal from any savings from previous years to supplement your income, this goes into cell A7. This will be added to your total income as if you are supplementing your income, you will likely spend it.
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CLICK HERE TO BEGIN
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Just added to the Fair Tax Calculator is the Flat Tax Calculator as proposed by S 173. Click on the link in the lower right or the tab below to go to the Flat Tax Calculator. The Flat Tax basically exempts a basic amount plus an additional amount for more dependents from the 17% tax.Click here to go to The Flat Tax Calculator
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Just added (1/11/15) The Automated Payment Transaction Tax (APTT). There is no bill before congress for this tax currently. This tax assesses a 0.0035% tax on every financial transaction. It also replaces the income tax.Click here to go to the Automated Payment Transaction Tax
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