What Happened to My Money?
What is gross income?
The total amount of money that you earn
What is the purpose of income taxes?
To fund government programs
What is the importance of April 15th?
It is the annual deadline for filing taxes
What is a tax credit?
An amount of money a taxpayer can subtract from the taxes they owe
Is there a limit to how much you can give a nonprofit organization?
No
What is net income?
The amount of money that you receive after your taxes and other deductibles are taken out of your paycheck
When should you make a budget?
After you calculate your net income
What is a tax refund?
Money that you get back from the federal government that you overpaid on your income tax
What are the two common tax forms?
Form/Usage and Schedule/Usage
What is consumption tax?
A tax on the purchase of goods or services in the form of sales tax, excise tax, and other special taxes
What is NET INCOME reffered to as?
Take Home Pay
What determines the amount of money you pay in taxes?
Your income and your w-4 form
What is a tax bracket?
A tax bracket is a range of income that is taxed at a specific rate, with higher rates applying to higher income ranges.
What is a W-2 form?
A document that your employer fills out to report how much money was withheld from your income for taxes
What is Capital Gains Tax?
Tax on profits made from selling assets that have risen in value
When your job withholds money from your paycheck and instead directly gives the proper amount you owe in taxes to the government
What two government programs are funded by FICA?
Social Security and Medicare
What happens when you fail to pay your taxes properly?
If you do not properly file your taxes, you may face penalties, interest on unpaid taxes, audits, and potential legal consequences, including fines or even criminal charges in severe cases.
What is an audit?
An official IRS inspection of a tax return to ensure the income and deductions are accurate
Do renters pay property tax?
No, only people who own properties have to pay property tax
What is a fiscal year?
A fiscal year is a 12-month period used by governments and businesses for accounting and financial reporting
Why is it important to never have large tax returns?
You earn no interest on the money you store in the government.
How much total money gets unclaimed in tax refunds per year?
Over $1 Billion
What should you do with your tax files?
You should keep your tax files for at least 3 years in case the IRS conducts an audit
What is the limit for a gift tax?
$16,000 per individual