Types of Federal Taxes Administered by the IRS
The Internal Revenue Service administers the federal tax system under authority granted by the Internal Revenue Code (IRC), codified at Title 26 of the United States Code. That code organizes federal taxes into distinct subtitles, each governing a separate category of taxable activity. Understanding which tax types apply to a given situation — and how each operates mechanically — is foundational to meeting federal filing and payment obligations. This page covers the major categories of federal tax, how each is assessed and collected, the scenarios that trigger each type, and the boundaries that distinguish one category from another.
Definition and scope
The IRC divides federal tax authority across six primary subtitles, four of which contain substantive tax obligations that the IRS directly administers. As the IRS mission and authority framework makes clear, the agency cannot assess or collect any tax that lacks a specific statutory basis in the IRC — every tax type traces to an explicit code section.
The four substantive tax subtitles are:
- Subtitle A (IRC §§ 1–1564) — Income taxes, covering individuals, corporations, trusts, and estates
- Subtitle B (IRC §§ 2001–2801) — Estate and gift taxes
- Subtitle C (IRC §§ 3101–3510) — Employment taxes, including payroll and self-employment taxes
- Subtitle D (IRC §§ 4001–5000D) — Excise taxes on specific goods, services, and activities
Together, these subtitles define the scope of what the IRS collects. The federal tax types overview provides a broader structural map of how these categories interact within the federal revenue system.
For a reference point on scale: individual income tax and payroll taxes together accounted for approximately 90 percent of federal revenue in fiscal year 2022, according to the Congressional Budget Office.
How it works
Each tax category operates through a distinct assessment and collection mechanism.
Individual Income Tax (IRC Subtitle A)
Individual income tax applies to wages, salaries, investment income, business profits, and other taxable income received by natural persons. The tax is progressive, with rates ranging from 10 percent to 37 percent across seven brackets (IRC § 1). Liability is self-assessed through an annual return (Form 1040) and satisfied through withholding during the year, estimated tax payments, or a combination of both. For details on withholding mechanics, see tax withholding rules.
Corporate Income Tax (IRC Subtitle A)
Corporations taxed as C-corporations face a flat 21 percent federal rate (IRC § 11, as amended by the Tax Cuts and Jobs Act of 2017, Public Law 115-97). Pass-through entities — S-corporations, partnerships, and LLCs — do not pay corporate income tax at the entity level; instead, income flows to owners' individual returns.
Payroll and Employment Taxes (IRC Subtitle C)
Payroll taxes fund Social Security and Medicare under the Federal Insurance Contributions Act (FICA). Employees and employers each contribute 6.2 percent for Social Security (on wages up to the annual wage base, set at $168,600 for 2024 per IRS Publication 15) and 1.45 percent for Medicare, with no wage cap. Self-employed individuals pay the combined 15.3 percent rate under the Self-Employment Contributions Act (SECA), subject to a deduction for the employer-equivalent portion. See self-employment tax and payroll tax requirements for operational detail.
Estate and Gift Tax (IRC Subtitle B)
The federal estate tax applies to the transfer of a decedent's taxable estate exceeding the applicable exclusion amount — $13,610,000 per individual for 2024 (IRC § 2010; IRS Revenue Procedure 2023-34). The gift tax, unified with the estate tax, applies to lifetime transfers exceeding the annual exclusion of $18,000 per recipient for 2024. See estate and gift tax for the full unified credit calculation.
Excise Taxes (IRC Subtitle D)
Excise taxes are transaction-based taxes on specific goods or activities — fuel, tobacco, alcohol, firearms, air transportation, and certain healthcare-related items among them. Unlike income taxes, excise taxes are typically embedded in the price of goods and remitted by manufacturers, importers, or retailers rather than end consumers directly filing returns.
Common scenarios
Three operational scenarios illustrate how multiple tax types intersect for a single taxpayer:
- Sole proprietor earning $85,000 in net profit — Owes individual income tax on that profit (at marginal rates starting at 10 percent), plus self-employment tax at 15.3 percent on the full net earnings, subject to the SECA deduction. The gig economy tax requirements page addresses this scenario in detail for platform workers.
- Small business with 12 employees — The business must withhold federal income tax and the employee share of FICA from wages, remit the employer share of FICA, and file quarterly Form 941 returns. Failure to remit withheld taxes triggers the Trust Fund Recovery Penalty under IRC § 6672. See small business tax obligations.
- Estate of a decedent with $15 million in assets — Approximately $1.39 million of the estate (the amount exceeding the 2024 exclusion) would be subject to the 40 percent maximum estate tax rate, requiring Form 706 to be filed within 9 months of the date of death (IRC § 6075(a)).
The irsauthority.com home resource provides entry points to compliance guidance across all of these scenario types.
Decision boundaries
Several distinctions determine which tax type — or combination of types — applies in a given situation.
Employee vs. self-employed worker
An employee's Social Security and Medicare obligations are split equally between worker and employer. A self-employed individual bears the full 15.3 percent rate but may deduct 50 percent of that amount as an above-the-line deduction under IRC § 164(f). Misclassification of employees as independent contractors is one of the IRS's identified compliance focus areas, documented in IRS Publication 1976.
C-corporation vs. pass-through entity
A C-corporation pays the 21 percent corporate rate at the entity level; shareholders then pay individual income tax on dividends (double taxation). An S-corporation or partnership pays no entity-level federal income tax; the IRC §§ 1366 and 702 flow-through rules allocate income directly to owners' returns. The choice of entity structure determines which tax liability regime applies.
Taxable gifts vs. excluded transfers
Not all gifts trigger gift tax. Transfers that fall within the annual $18,000 per-recipient exclusion, payments made directly to educational institutions for tuition under IRC § 2503(e), and payments made directly to medical providers for another person's care are excluded from gift tax entirely — even if they exceed $18,000.
Excise tax applicability
Excise tax liability turns on the specific transaction, not on the taxpayer's overall income. A business that sells 1,000 gallons of diesel fuel in a taxable transaction owes federal excise tax on those gallons regardless of its profitability. The excise tax overview details the applicable rates by category.
The relationship between these categories is not always exclusive. A taxpayer may simultaneously owe individual income tax, self-employment tax, and excise tax on different streams of activity — each governed by separate IRC subtitle provisions, separate forms, and separate filing deadlines. For a consolidated view of filing obligations across tax types, see tax filing requirements.