Personal Finance: Ch. 2, 3

arbitration

A formal process that uses a neutral third party with expertise in legal issues to make a formal decision that had the same effect as a court order

union

A group of people working in the same or similar occupations, organized for the benefit of all

job rotation

A job design in which employees are trained to do more than one specialized task

voluntary compliance

A tax system that requires all citizens to be responsible for preparing and filing their tax returns on time and paying taxes due

flextime

A type of work schedule that allows employees to choose their working hours outside of core time periods

taxable income

After the standard deduction and exemptions are subtracted from adjusted gross income, you arrive at your

deductions

Amounts that are subtracted from your gross pay

tax credit

An amount subtracted directly from tax owed

exemption

An amount you may subtract from your income for each person who depends on your income to live

lobbying

An effort made to influence legislation in a way that benefits a profession

audit

An examination of tax returns by the IRS

profit sharing

An incentive plan that allows employees to receive a portion of the company's profit at the end of the corporate year

benefits

Company-provided supplements to salaries such as sick pay, vacation time, and health insurance

itemized deductions

Expenses that can be subtracted from adjusted gross income to determine your taxable income

itemized deductions

Expenses that can subtracted from adjusted gross income to determine your taxable income

flextime

Flexible schedules that allow employees to choose their working hours within defined limits

standard deduction

In order to avoid itemizing deductions, a person may elect to take the (a flat amount)

industrial union

Membership of skilled, semi skilled, or unskilled workers in a particular place, industry, or group of industries

revenue

Money collected by the government from citizens and businesses in the form of taxes

child support

Money paid to a former spouse (not taxable income) for the support of dependent children

alimony

Money paid to former spouse (taxable income) for that person's support

proportional taxes

Taxes for which the rate remains constant, regardless of income

progressive taxes

Taxes that take a larger share of income as the amount of income grows

net pay

The amount left over after all deductions have been taken out of your gross pay

adjusted gross income

The amount remaining when adjustments are subtracted from gross income

seniority

The policy that the last workers hired will be the first ones laid off when jobs must be cut

collective bargaining

The process of negotiating the terms of employment for union members

overtime

The time worked beyond the standard 40 hours in a typical five day period

self-employment tax

The total Social Security and Medicare tax, including employer matching contributions, paid by people who work for themselves

gross pay

The total amount you earn before any deductions are subtracted

regressive taxes

The type of tax that requires those who can least afford it to pay the most in proportion to their income

incentive

To encourage employees to strive for higher levels of performance

vested

When employees are entitled to receive a full retirement account after a specified period of time

strike

When employers and union officials cannot agree on the terms of a new labor contract, the result is often a

refund

When the amount of taxes withheld is larger than your total tax owed

job sharing

When two people share what was originally a full time position

tax evasion

Willful failure to pay taxes

April 15

You must file your federal income tax by this date