Key Terms
Each year tax payers submit a _______ to the IRS with the goal of getting as close to zero as possible
Tax Return
The form which you use to calculate how much income tax should be withheld from your pay over the fiscal year.
Form W-4
Withholdings and deductions are....
a. examples of deficit spending
b. expenses that are taken out of paychecks
c. categories of a good budget
d. money that the government gives back to you
B. EXPENSES THAT ARE TAKEN OUT OF PAYCHECKS
TRUE OR FALSE
TRUE
Parks, Libraries, Roads, Police, Fire Dept., Schools, Zoos.
Getting a large tax refund is such a good trick to saving money
TRUE OR FALSE
FALSE,
completing the W-4 correctly can allow you to get access to all your money throughout the entire year and not letting it sit with the government
Due to the 2018 tax reforms, most tax filers can just take the _________
Standard Deduction
The form shows important information about the income you've earned from your employer, amount of taxes withheld from your paycheck, benefits provided and other information for the year. You use this form to file your federal and state taxes.
Form W-2
The tax on the purchase of goods or services is called....
a. consumption tax
b. purchase tax
c. income tax
d. goods and service tax
A. CONSUMPTION TAX
When someone says they need to file their taxes, they are talking about filling out the W-2 form
TRUE OR FALSE
FALSE
W-2 Form is from your employer with your income information that you will use to fill out the 1040 form to file taxes
Explain the difference between your gross and net income.
Gross pay is what employees earn before taxes, benefits and other payroll deductions are withheld from their wages. The amount remaining after all withholdings are accounted for is net income or take-home pay.
You can produce ______ by buying and selling stocks, bonds, mutual funds, and real estate.
a. large income
b. tax deductions
c. HSA
d. Investment Income
D. Investment Income
The taxes you pay for snacks, or any other items at a gas station would be an example of_________
sales tax
The form is used to report non-employment income to the Internal Revenue Service (IRS). Businesses are typically required to issue a this to a taxpayer (other than a corporation) who has received at least $600 or more in non-employment income during the tax year.
Form 1099
The money you earn hourly for your time and effort is called your.....
a. wages
b. salary
c. minimum wage
d. income tax
April 15th is the deadline for filing your income tax return
TRUE OR FALSE
TRUE
What is the difference between earned income, passive income, and investment income?
Earned income is any money you make working, passive income ins any money you make without requiring too much effort, and investment income is money you make from investments as they grow
Why are people required to give a portion of their income to the government. Give examples of government services that taxes fund.
LONG ANSWER
We are basically paying to be a citizen of USA. As citizens we have access to things roads, public education, law enforcement, jails, fire dept., libraries, zoos, parks, museums, social services. Tax revenue is how the government pays for all of those things and we give up a portion of our income so we can enjoy those benefits.
The 12 month period used for reporting financial activity is known as ________
Fiscal Year
Form 1040
When you make more money, you will....
a. pay more in taxes
b. pay less in taxes
c. pay the same in taxes
d. not pay taxes
Property tax, inheritance tax, estate tax, and gift tax are all examples of wealth tax
TRUE OR FALSE
TRUE
Why should you NOT want to have a large tax refund?
it just means that you gave too much of your pay away during the actual year. It was sitting with the government without any growth. If filling out the W-4 correctly at the beginning of your job, you can avoid large refunds.
Describe some of the arguments that supporters and opponents of wealth tax make
LONG ANSWER
Advocates if wealth tax say that it increases revenues by taxing real estate and investment holdings, encourages people to spend wealth that would sit and be worn down by taxes, and can reduce wealth inequality since the wealthiest 1% of Americans hold a majority of the country's wealth.
Critics of wealth tac say it causes citizens to pay taxes on the same assets multiple times, reduces the incentives to keep working for money that will be taken away by taxes, and encourages wealthy business owners and investors to leave the US
Planning to spend more money than you actually have coming in is called ________
Deficit spending
The form is used to report types of income that aren't listed on the 1040, such as capital gains, alimony, unemployment payments, and gambling winnings. This also includes some common adjustments to income, like the student loan interest deduction and deductions for educator expenses.
a. with you credit card
b. excise tax
c. income tax
d. sales tax
D. SALES TAX
All states have inheritance tax
TRUE OR FALSE
FALSE
only a few states have this, it requires you to pay tax on an asset you receive when someone passes away.
Why shouldn't people let tricky tax situations get in the way of being outrageously generous?
Giving allows us to be a blessing to others. You can always be generous and look for ways to give back, even if you do not feel like you have the cash.
Free points!!!
+200