Chapter 3- Federal Income Taxes Quizlet, Personal Finance Management
Child Support
Money paid to a former spouse (which is not taxable income) for the support of dependent children is called ______ __________.
Alemoney
Money paid to a former spouse (which is taxable income) for that person's support is called __________.
Adjusted Gross Income
The amount remaining when adjustments are subtracted from gross income.
Tax Evasion
To intentionally fail to pay taxes owed is to commit a serious crime called ____ _______.
Gross Income
When all sources of taxable income are added together, the total is called ________ ___________.
IRS (Internal Revenue Service)
An administrative agency of the federal government that collects taxes and enforces tax laws.
Exemption
An amount that can be subtracted from your income for each person who depends on your income to live is an ___________.
Audit
An examination of tax returns by the IRS.
Standard Deduction
In order to avoid itemizing deductions, a person may elect to take the __________ _________, which is a flat amount.
Itemized Deductions
Expenses that can be subtracted from adjusted gross income to determine your taxable income.
Revenue
Incoming taxes, which are treated as income by the government, are called _________.
Tax Credit
A _____ _________ is an amount subtracted directly from tax owed.
Regressive Tax
A ____________ _____ allows a higher-income person to pay a lower percentage of income in taxes than a lower-income person.
Voluntary Compliance
A tax system that is based on ____________ ____________ requires all citizens to be responsible for preparing and filing their tax returns on time and paying taxes due.
Progressive Tax
A tax that increase in proportion to increase in income is known as a __________ _____.
Proportional Tax
A type of tax for which the rate stays the same regardless of income is called _______________ _____.
Taxable
After the standard deduction and exemptions are subtracted from adjusted gross income, you arrive at your _______ income.
