An examiner may require the immediate production of records. Make sure your companyâs data storage and networking infrastructure is up to date. Prepare for unannounced compliance audit by obtaining a copy of an inspection checklist from a specific regulatory or governing agency. Compliance is a multifaceted and complex matter.
Federal taxable income is the adjusted gross income less the deduction for personal exemptions and itemized deductions, which include items such as home mortgage interest, property taxes and charitable donations. Taxable income is the figure used to determine the actual taxes due.
The difference between taxable income and income tax is an individual's net income. For example, imagine someone has $60,000 in gross income, and he qualifies for $10,000 in deductions. His taxable income is $50,000, and he has an effective tax rate of 15%, making his income tax payment $7,500 and his net income $42,500. Net Income on Tax Returns