Taxes Practice Quiz

What does "Voluntary Compliance" refer to in tax terminology?

• The amount of pay remaining after deductions have been taken out.

• When the total tax payments are greater than the total tax.

• The idea that taxpayers are responsible for declaring all their income, calculating their tax liability correctly, and filing a tax return on time.

• A percentage of money that you pay to the state government based on the income you make.

What are "Transaction Taxes"?

• Taxes on economic transactions.

• Taxes on the annual earnings of businesses, individuals, trusts, and legal entities, forming the largest source of revenue for the federal government.

• A US federal payroll tax payable by both employees and employers to fund Social Security and Medicare.

• The amount of pay remaining after deductions have been taken out.

Which definition best describes "Property Taxes"?

• Taxes on personal and business property.

• Taxes on income both earned and unearned.

• The individual responsible for calculating taxes and filing tax returns.

• A bureau of the Dept. of Treasury that is tasked with the enforcement of income tax laws and oversees the collection of federal income taxes.

What is the definition of "Income Taxes"?

• A tax on the annual earnings of businesses, individuals, trusts, and legal entities, forming the largest source of revenue for the federal government.

• Taxes on economic transactions.

• Taxes on personal and business property.

• The amount of pay remaining after deductions have been taken out.

What does "FICA" stand for?

• A US federal payroll tax payable by both employees and employers to fund Social Security and Medicare.

• Taxes on economic transactions.

• The individual responsible for calculating taxes and filing tax returns.

• A bureau of the Dept. of Treasury that is tasked with the enforcement of income tax laws and oversees the collection of federal income taxes.

Which tax system does the US federal government use?

• Progressive

• Proportional

• Regressive

• Voluntary

Which equation below shows how gross pay relates to net pay?

• Gross Pay = Net Pay * Deductions

• Gross Pay = Net Pay - Deductions

• Net Pay = Gross Pay + Deductions

• Net Pay = Gross Pay - Deductions

What is one of the two FICA taxes?

• FUTA

• Federal Income Tax

• SUTA

• Medicare Tax

Your parents pay $3500 in taxes each year based off of the value of your home. Which type of tax is this?

• Payroll tax

• Property tax

• Sales tax

• Income tax