Personal Finance

A general sales tax is also referred to as an excise tax

false

The principle purpose of taxes is to control economic conditions

false

A drawback of Flexible Spending Accounts is that any account funds must be used to pay for expenses incurred before year's end or the money is lost.

true

A person's filing status is affected by marital status and dependents.

true

An estate tax is imposed on the value of an individual's property at the time of their death

true

An exclusion is earnings not included in gross income

true

An office audit requires that a person visit an IRS office to clarify some aspect of his or her tax return.

true

Capital gains refer to profits from the sale of stocks, bonds, or real estate.

true

Real estate property taxes are the major source of revenue for local governments

true

State and local governments may impose a personal property tax on the value of automobiles.

true

Tax evasion is the use of illegal actions to reduce one's taxes.

true

Taxable income is a result of subtracting adjustments to income and standard (or itemized) deductions from gross income.

true

Taxpayers should beware of tax preparers who offer your refund in advance (refund anticipation loans) and charge interest rates exceeding 300 percent.

true

The Tax Cuts and Jobs Act simplified the basic form used when filing your taxes, so that there is now only one form, Form 1040, to report your income.

true