Understanding Taxes and Income

Front

What is income tax?

Back

A tax taken from money people earn from working.

Front

What type of tax is added to the price of items at a store?

Back

Sales Tax.

Front

What do property taxes help pay for?

Back

Schools, fire departments, and roads.

Front

What is an example of payroll tax?

Back

Money taken out of your paycheck for Social Security.

Front

How do you calculate net income?

Back

Gross income minus taxes and deductions.

Front

What is gross income?

Back

The total amount of money earned before any deductions.

Front

What is the purpose of sales tax?

Back

To generate revenue for state and local governments.

Front

What is a deduction?

Back

An amount that is subtracted from gross income to determine taxable income.

Front

What is the difference between gross income and net income?

Back

Gross income is the total earnings, while net income is what remains after taxes and deductions.

Front

What is property tax?

Back

A tax paid by property owners based on the value of their property.