Income Basics
Money you earn from working?
What is Income
Money collected by the government to pay for public services like roads and schools.
What are taxes?
A tax added to the price of many goods at the time of purchase.
What is sales tax?
Money taken out of your paycheck for taxes or benefits?
What are deductions/ withholdings?
A plan for how you will spend and save your money.
What is a budget?
The total amount you earn before any taxes or deductions are taken out.
What is Gross Income?
The level of government that collects federal income tax.
What is the federal government?
If an item costs $10 and the sales tax rate is 8% this is the amount of tax paid.
What is $.0.80?
The document that shows your earnings and deductions for a pay period.
What is a pay stub?
Money you set aside for future goals or emergencies.
What is savings?
Getting paid based on the number of hours worked.
What is Wage/ Hourly pay?
Taxes collected by state or local governments to fund community services.
What are state and local taxes?
The total cost of a $50 item with a 6% sales tax
What is $53.00?
A payroll tax that helps fund retirement benefits.
What is social security tax?
Why knowing your net income is important when creating a budget.
What is...because it shows how much money you actually have to spend?
Getting paid the same amount each pay period regardless of hours worked.
What is a salary?
This type of tax is based on how much income you earn.
What is income tax?
Items that are usually not subject to sales tax, such as groceries or prescription medicine.
What are tax exempt item?
A payroll tax that helps pay for healthcare for seniors.
What is Medicare tax?
Choosing between wants and needs when money is limited is an example of this skill.
What is prioritizing?
The amount of money you actually take home after taxes and deductions.
What is net income (take home pay)?
Two programs funded by payroll taxes that support retirees and healthcare for older adults.
What are social security and Medicare?
Why sales tax makes budgeting important when shopping?
What is...because it increases the final cost of purchases?
Deductions taken out before taxes are calculated, such as retirement contributions.
What are pre-tax deductions?
How tracking deductions can help you make better financial decisions.
What is... understanding where your money goes and planning accordingly?