Tax liability refers to the amount of tax that an individual or entity owes to a government authority, such as the Internal Revenue Service (IRS) in the United States.

Tax liability is calculated based on the applicable tax laws and regulations and is determined by factors such as income, deductions, credits, and tax rates.

In general, individuals and businesses are required to pay taxes on their income, profits, and other types of taxable transactions, and failure to do so can result in penalties and interest charges.

Tax liability can be reduced through deductions, credits, and other tax planning strategies, but it cannot be completely avoided. It is important for individuals and businesses to accurately calculate and pay their tax liability in order to avoid legal and financial consequences.