Chapter 3

Question 1

Sales tax and excise tax

Answer 1

Taxes on Purchases

Question 2

is income that will be taxed at a later date.

Answer 2

Tax-deferred income

Question 3

is an amount not included in gross income.

Answer 3

exclusion

Question 4

is not subject to tax.

Answer 4

Tax-exempt income

Question 5

is an amount subtracted from adjusted
gross income (AGI) to arrive at taxable income.

Answer 5

Tax deduction

Question 6

reduced by certain adjustments, described below

Answer 6

Gross income

Question 7

is an investment that provides immediate tax benefits.

Answer 7

A tax shelter

Question 8

an investment that provides immediate tax benefits.

Answer 8

tax shelter

Question 9

is an amount subtracted from adjusted
gross income (AGI) to arrive at taxable income.

Answer 9

Tax deduction

Question 10

subtracted from AGI

Answer 10

Exemptions

Question 11

is a deduction for yourself, your spouse, or qualified dependents

Answer 11

Exemptions

Question 12

Tax table rates

Answer 12

marginal rates

Question 13

is the total tax due divided by taxable income.

Answer 13

average tax rate

Question 14

Paid by taxpayers with high amounts of certain deductions and various types of income

Answer 14

Alternative Minimum Tax (AMT)

Question 15

Designed to ensure that those who receive tax breaks also pay their fair share of taxes

Answer 15

Alternative Minimum Tax (AMT)

Question 16

Amount subtracted directly from the amount of taxes owed

Answer 16

Tax credit

Question 17

automaticsix-monthextension

Answer 17

Form 4868

Question 18

Underpayment of quarterly estimated taxes may require paying interest on the amount owed.

Answer 18

Penalties and interest

Question 19

Real estate property tax
Personal property tax

Answer 19

Taxes on property

Question 20

Federal estate tax

Answer 20

Attacks impose on the value of a persons property at the time of death

Question 21

What are the two types of taxes on the wealth

Answer 21

Federal estate tax
State inheritance tax

Question 22

 A tax levied on the value of property bequeathed by a
deceased

Answer 22

State inheritance tax

Question 23

What are the four types of taxes?

Answer 23

Texas on purchase
Taxes on property
Taxis in the wealth
Texas on earnings

Question 24

a detailed examination of your tax return by the IRS.

Answer 24

Tax audit

Question 25

Legitimate methods to reduce your tax obligation to
your fair share but no more

Answer 25

Practice tax avoidance

Question 26

Illegally not paying all the taxes you owe, such as not
reporting all income

Answer 26

TaxEvasion