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Oklahoma Tax Brackets 2020 from www.tax-brackets.org

Understanding Income Tax in Oklahoma

Introduction

Income tax is a tax that is levied on the income earned by an individual or business entity. The tax rate varies depending on the income level and the state in which the income is earned. In this article, we will discuss income tax in Oklahoma, its rates, and how to file your income tax return.

Oklahoma Income Tax Rates

Oklahoma has a progressive income tax system, which means that the tax rate increases as the income level increases. The tax rates range from 0.5% to 5.0%, and the income tax brackets are as follows: - For single filers, the tax rate is 0.5% for income up to $1,000, 1.0% for income between $1,001 and $2,500, 2.0% for income between $2,501 and $3,750, 3.0% for income between $3,751 and $4,900, 4.0% for income between $4,901 and $7,200, and 5.0% for income over $7,200. - For married couples filing jointly, the tax rate is 0.5% for income up to $2,000, 1.0% for income between $2,001 and $5,000, 2.0% for income between $5,001 and $7,500, 3.0% for income between $7,501 and $9,800, 4.0% for income between $9,801 and $14,400, and 5.0% for income over $14,400.

Deductions and Credits

Oklahoma residents are eligible for various deductions and credits that can help lower their income tax liability. Some of the most common deductions and credits are: - Standard Deduction: Oklahoma residents can claim a standard deduction of $6,350 for single filers and $12,700 for married couples filing jointly. - Itemized Deductions: Oklahoma residents can also claim itemized deductions for expenses such as mortgage interest, property taxes, and charitable contributions. - Child Tax Credit: Oklahoma residents can claim a child tax credit of up to $1,000 per child. - Earned Income Tax Credit: Oklahoma residents who have low to moderate income levels can claim the Earned Income Tax Credit, which can help reduce their tax liability.

Filing Your Income Tax Return

To file your income tax return in Oklahoma, you can either do it online or by mail. The deadline for filing your return is April 15th of each year. When filing your return, you will need to provide information about your income, deductions, and credits. You will also need to pay any taxes that you owe.

Penalties for Late Filing or Payment

If you fail to file your income tax return or pay your taxes by the deadline, you may be subject to penalties and interest. The penalty for late filing is 5% of the tax due per month, up to a maximum of 25%. The penalty for late payment is 1% of the tax due per month, up to a maximum of 12%.

Conclusion

Understanding income tax in Oklahoma is essential for residents who earn income in the state. By knowing the tax rates, deductions, and credits, you can reduce your tax liability and avoid penalties. Make sure to file your income tax return by the deadline to avoid any unnecessary fees.

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