The Facts About Income Tax Millions faithfully file their 1040 forms each April. But some things about federal income taxes may surprise you. Share | Related Content Tax Freedom Day Assess how many days you'll work to pay your federal tax liability. What Is a 1035 Exchange? 1035 exchanges provide a way to trade-in an annuity contract or life insurance policy without triggering a tax liability. Comparing Investments This calculator compares the net gain of a taxable investment versus a tax-favored one.