The difference is that the FIT is Federal Taxable Income. I am retired and part of my retirement income is taxable and the part that comes from my savings is not because it was a personal injury settlement that is not allowed to be taxed. But it is still part of my gross income. While I was still working.. my gross income included ALL of the incomer I earned. But my FIT income was less because part of my paycheck went directly into a 401k account BEFORE it was taxed and is not taxable until it is withdrawn from the account. That is the portion of my retirement that is now taxed. |