Topic 2 Volcab

Question 0

Tax rates that apply to income each text record range I’ll soon as marginal tax bracket

Answer 0

Marginal tax rate

Question 1

One of six income range segments and which income is taxed at increasing rates also known as marginal tax rate

Answer 1

Marginal tax bracket marginal tax ratw

Question 2

Yearly adjustments to tax brackets the reduce inflation is effects on tax brackets

Answer 2

Indexing

Question 3

Total marginal rate reflects all taxes on a person’s income including federal state and local taxes as well Social Security and Medicare

Answer 3

Effective marginal tax rate

Question 4

Proportion of total income paid and income taxes

Answer 4

Average tax rate

Question 5

Compensation from all sources

Answer 5

Total income

Question 6

Compensation for performing personal services

Answer 6

Earned income

Question 7

Net income received from the sale of an asset above the costs incurred to purchase and sell it

Answer 7

Capital gain

Question 8

Profit loss on the sale of an asset that is been held for more than a year

Answer 8

Long-term gain or loss

Question 9

All income in the form of money, goods, service, property

Answer 9

Gross income

Question 10

Income not subject to federal taxation

Answer 10

Exclusions

Question 11

Allowable subtractions from gross income

Answer 11

Adjustments to income

Question 12

Gross income less any exclusions and adjustments

Answer 12

Adjusted gross income AGI

Question 13

I just been subtracted from gross income with her taxpayer itemizes deductions are not

Answer 13

Above the line deductions

Question 14

Fixed amount that all taxpayers my subtract from the adjusted gross income if they do not itemize their deductions

Answer 14

Standard deduction

Question 15

Legally permitted amount deducted from AGI based on the number of people that the taxpayers income supports

Answer 15

Exemption or personal exemption

Question 16

Dollar for dollar decrease in tax liability also known as credit

Answer 16

Tax credit

Question 17

Tax credit they can reduce ones tax liability only to zero if credit is more than tax liability access is not refunded

Answer 17

Non-refundable tax credit

Question 18

Text credit they can reduce ones income tax liability to below zero with access being refunded to taxpayer

Answer 18

Refundable tax credit

Question 19

Partially refundable tax credit up to $2500 a year to help defray college expenses for first four years of post secondary education

Answer 19

American opportunity tax credit

Question 20

Non-refundable tax credit that may be cleaned every year for tuition and related expenses paid for all years post secondary undertaken to acquire or improve job skills

Answer 20

Lifetime learning credit

Question 21

Refundable tax credit that may be claimed by workers with a qualifying child and in certain cases my child is workers

Answer 21

Earned income credit EIC

Question 22

Reducing tax liability through legal techniques

Answer 22

Tax avoidance

Question 23

Special tax return form maybe file to obtain deserved a refund or correct mistakes from past three years 1040 X

Answer 23

Amended return

Question 24

Most valuable alternative that must be sacrificed to satisfy I want or need

Answer 24

Opportunity cost

Question 25

Iris regulation requiring unspent dollars a flexible spending account at end of calendar year before fitted and less employer allows 2 1/2 month grace period for spending funds

Answer 25

Use it or lose it rule

Question 26

Amount of income withheld from work or salary before taxes are calculated

Answer 26

Pretax income

Question 27

Income, dividends, capital gains that are allowed to grow without taxes until distributions are taken

Answer 27

Tax-deferred

Question 28

Iris approved way to pay for future education cost per child younger than age 18 where my earnings accumulate tax-free and withdraws qualified expenses are tax free

Answer 28

Coverdell education savings account or education savings account

Question 29

Percentage yield on a taxable investment after subtracting the effect of federal income taxes that will need to be paid on the investment

Answer 29

After-tax field

Question 30

Income tax having that a single rate for all taxpayers regardless of income level and type

Answer 30

Flat tax

Question 31

Federal retail sales tax on the estimated value added to the product or material and stage of manufacture or distribution

Answer 31

Value added tax

Question 32

Technique to save income taxes by preparing tax-deductible expenses here in advance so as to increase ones itemization higher than the standard deduction threshold and taking the center deduction in the following year

Answer 32

Accelerating deductions

Question 33

Investment returns in the form of rents, dividends, capital gains, interest, royalties

Answer 33

Unearned income

Question 34

Paper losses that may not represent actual losses created when deductions generated from investment exceed and come from the investment

Answer 34

Tax losses