Tax Concept
When calculating federal income taxes, "income" includes all of the following categories EXCEPT:
active income
Gross income after certain reductions have been made is
adjusted gross income
When calculating federal income taxes, what increases "income"?
alimony
Adjustments to income include all of the following EXCEPT:
charitable contributions
A tax due on the purchase of gasoline is called a(n):
excise tax
This tax is a major financial planning factor for most people because it is sometimes imposed at the federal, state, and local levels.
income tax
Shannon is working on her federal income tax form and wants to determine if she should itemize her deductions. She has identified several possible deductions. Which of the following is an acceptable deduction? - $10,000 gift to her cousin - credit card interest - medical and dental expenses less than 10% of AGI - miscellaneous expenses in excess fo 2% of AGI - moving expenses for a new job that is 25 miles from her old home
miscellaneous expenses in excess fo 2% of AGI
Payroll deductions for federal government retirement benefits (such as old age, survivor, and disability insurance) are called
social security taxes
Joseph needs to complete his income taxes for the year. He has already calculated his adjusted gross income. What does he need to do next?
subtract his itemized deductions
Income that is never subject to tax is called
tax-exempt income