Are taxes deducted from gross income or net income?

Basically, taxes are deducted from your net income. Net income is what's left after taking deductions from your gross income. These deductions could be things like taxes, retirement contributions, and other costs.

Gross income is everything you earn before any deductions or exemptions are taken out such as your salary, profits from a business, rental income, capital gains, dividends, pension, etc.

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