AGLS EXAM 1 Review - Taxes

Question 1

What are individuals taxed on?

Answer 1

Earnings
Purchases
Assets
Gifts

Question 2

What are name of tax

Answer 2

Income tax
Sales tax
Property taxes
Gift and estate taxes

Question 3

What are state sales exempted on?

Answer 3

Groceries

Prescription and non-prescription dogs

Question 4

What are exercise tax?

Answer 4

Taxes paid by merchants to the State of Texas on specific consumer goods (increases the purchase price)

Question 5

Types of earned income

Answer 5

Wages, salaries, tips, and contract work

Question 6

Types of unearned income

Answer 6

Interest, dividends, capital gains, IRA, Pension, and Annuity distributions, unemployment, and social security

Question 7

What form is used by employers to withhold income tax from your wages or salary during the year?

Answer 7

Form W-4

Question 8

What does a W-4 form do?

Answer 8

Helps employers approximate your income taxes due based upon your income level, marital status, etc.

Question 9

What form would be used if your employer withheld too little or too much? Tax return

Answer 9

Form 1040

Question 10

When does a 1040 be submitted by?

Answer 10

Before April 15 to pay or receive the difference

Question 11

What are the filing options?

Answer 11

By mail
E-file
IRS free-file (AGI is less than $73,000)
IRS fillable forms
Commercial software
Authorized e file provider

Question 12

A form if needed to file a tax return

Answer 12

W-2

Question 13

What is AGI?

Answer 13

Adjusted Gross Income

your income minus some deductions, like 401(k) or IRA contributions