Taxes
1040
A form used by U.S. taxpayers to file an annual income tax.
Interest Income
The money earned from lending money to others or from savings accounts, bonds, or certificates of deposit (CDs).
Standard Deduction
A fixed amount that reduces taxable income that tax filers can claim without providing specific details.
E-Filing
means submitting your tax return to the IRS electronically.
Benefits
a form of employee compensation in addition to pay.
1099
Form that reports gross income from self-employment or freelance work; does not account for tax withholdings
Itemized Deductions
Various expenses that lower taxable income
Tax Credit
Dollar-for-dollar reductions in the amount of tax owed. It's a type of incentive that reduces tax liability and is usually offered to promote certain economic or social behaviors.
Gross Pay
The total amount you earn before any deductions are subtracted.
Labor Union
A labor union is a group of people who work in the same or similar occupations, organized for the benefit of all employees in these occupations.
Adjusted Gross Income
A taxpayer's total income from all sources minus specific deductions known as "adjustments to income."
Payroll Taxes
Deducted from employees' salaries and are used to fund programs such as Social Security, Medicare, and unemployment insurance.
Tax Deduction
An expense that lowers taxable income, which means paying taxes on a smaller portion of earnings.
Overtime
the time you work beyond regular hours
Collective Bargaining
the process of negotiating a work contract for union members
Capital Gains
Profits made from selling investments such as stocks, bonds, or real estate.
Property Taxes
Based on the value of real estate properties and are used to fund local services like schools, police and fire departments, road maintenance, and public parks.
Unearned Income
Refers to money obtained from sources other than work, including interest, dividends, rental income, and capital gains.
Deductions
the amount subtracted from your gross pay.
W-2
an IRS form that employers must send to an employee and the IRS every year. The form reports an employee's annual wages and the taxes withheld. Employees also use the form to file their taxes every year.
Earned Income
Refers to money earned through active work or services provided, such as wages, salaries, tips, or self-employment income.
Sales Tax
Imposed on the sale of goods and services and vary from state to state and is used to fund state-level services and programs, including education, transportation infrastructure, healthcare, and public safety.
W-4
Form is filled by an employee to indicate his or her tax situation to the employer.
Net Pay
the amount left after all deductions are taken out of gross pay.
APR (Annual Percentage Rate)
represents the annual cost of borrowing money, including fees.