Understanding Income and Taxes

Please match each definition with the correct term:

Amounts of money subtracted from an employee's total pay.

• Deductions

• Exemption

• Form W-2

• Form W-4

• Gross Pay

Please match each definition with the correct term:

A form that tells the employer how much tax to withhold from an employee's paycheck.

• Deductions

• Exemption

• Form W-2

• Form W-4

• Gross Pay

Please match each definition with the correct term:

A form that states the amount the employee was paid in the previous year.

• Deductions

• Exemption

• Form W-2

• Form W-4

• Gross Pay

Please match each definition with the correct term:

Take-home pay.

• Deductions

• Exemption

• Net Pay

• Medicare

• Gross Pay

Please match each definition with the correct term:

A set amount of money in which a person does not have to pay tax.

• Deductions

• Exemption

• Net Pay

• Medicare

• Gross Pay

Please match each definition with the correct term:

The total amount an employee earns for a pay period before any deductions are subtracted.

• Deductions

• Exemption

• Net Pay

• Medicare

• Gross Pay

Please match each definition with the correct term:

The federal government's insurance program for people over age 65 or for certain people with disabilities.

• Deductions

• Exemption

• Net Pay

• Medicare

• Gross Pay

True or False: All the net income a person earns is his or hers to keep.

• True

• False

True or False: Minimum wage is the lowest amount of money an employer is allowed to pay a worker per hour for most jobs.

• True

• False

True or False: Earning tips can encourage a worker to continue to provide good service.

• True

• False