Personal Finance Ch. 6 Final

An employer matches employees' contributions to ____ and sends the total amount to the government.

FICA taxes

Shortly after the end of the year, you will receive a ___ form summarizing all of your relevant income and tax withholding information from each employer you worked for during the year.

W2

Real estate taxes are calculated based on the

estimated value of the property

If you are claimed as a dependent on a parent's or guardian's tax return, then you will NOT be required to file your own tax return.

false

Individuals pay a variety of taxes to the government, but businesses do not

false

Real estate taxes are relatively constant from state to state, and even city to city.

false

Taxes are money collected by a government from other countries for the purpose of operating the government.

false

The federal and state governments may collect income tax, but city governments may only collect sales and real estate taxes.

false

The tax rate a person must pay is not affected by the person's total earned income.

false

There is a cap on the amount of wages subject to the Medicare tax.

false

Whether you choose to file a tax return with the 1040EZ form or the 1040 form, you will have the option of itemizing your deductions.

false

Your adjusted gross income will always be greater than or equal to your total income.

false

Your tax filing status is determined by the IRS.

false

You would use a 1040 or a 1040EZ to

file a tax return

In general, your applicable tax rate and rules differ depending on which ___ you choose.

filing status

Single, head of household, and married filing joint return are all examples of

filing status

The total amount of money a worker earns in a pay period is his or her

gross pay

Medicare is a government ____ program.

health insurance

In general, the more money a person earns, the _____ he or she must pay taxes.

higher the rate is at which

When your parent or guardian claims you as a dependent on a tax return, he or she is able to

lower what he or she owes in taxes

The total amount of money a worker takes home in a pay period is his or her

net pay

Accurate completion of your tax return will show whether you underpaid your taxes and need to pay additional income tax or if you overpaid and will receive a

refund

Another term for net pay is

take-home pay

Taxes are figured based on your earnings during which of the following time periods?

the calendar year

A sales tax is sent to the government by

the merchant who sold the item

Because the tax code is extremely complex, you are more likely to want and need the services of a tax professional as your income increases and you begin to make investments.

true

In some cases, it may be financially advantageous for a married couple to file separate tax returns.

true

The total amount of money a worker earns is not the same as the total amount of money the worker receives as "take home pay."

true

Under current tax laws, if you paid $2,000 in interest on student loans, you can reduce your gross income by $2,000.

true

The deadline for filing your federal tax return each year is

April 15th

Most people are considered dependents of their parents or guardians by the IRS until they reach the age of

18

The ____ is the government body that enforces federal tax laws and collects the taxes.

Internal Revenue Service

Federal income taxes, state income taxes, and Social Security withholding's are all

Payroll taxes

FICA refers to payroll taxes withheld for

Social Security and Medicare

Public programs such as national defense, public schools, Social Security, and fire and police protection are all paid for through

Tax revenue