taxes

Question 1

Income

Answer 1

How much money you make; your gross income

Question 2

Deductions

Answer 2

How much money you can “write off”

Question 3

write off

Answer 3

is an expense that can be subtracted from your reported taxable income

• Charity, childcare, job-related expenses

Question 4

Credits

Answer 4

Any extra money you get (education, children, green energy)

Question 5

Rate

Answer 5

What percentage of tax you pay based on your adjusted gross income

Question 6

W-4

Answer 6

This form allows you to document their tax situation (Are they married? Do they have dependents? Do they get a tax exemption?)

Question 7

W-2

Answer 7

employers send this form to employees with income earned and taxes paid.

Question 8

1098/1099

Answer 8

a form that is sent to you with any income earned from investments, banking (interest), or any other source of income

Question 9

1040

Answer 9

Tax form that includes all the information from a W2 & a 1098 to file state/federal income taxes.

Question 10

Payroll tax-

Answer 10

tax on what you earned

Question 11

Social Insurance taxes

Answer 11

contribution to FICA, Social Security (6.2%), Medicare (1.45%)

Question 12

proportional taxes

Answer 12

as income goes up, the percentage paid in taxes stays the same

Question 13

Withholding

Answer 13

money taken out of paycheck to prepay for federal and state income taxes.

Question 14

progressive taxes

Answer 14

as income goes up, the percentage paid in taxes go up

Question 15

regressive taxes

Answer 15

as income goes up, the percentage paid in taxes go down