Unit 2 Taxes Vocabulary

What is the standard Internal Revenue Service (IRS) form that individuals can use to file their annual income tax returns?

• 1040

• I-9

Which form details all "non-employee" compensation, including for specific jobs like freelancers or contractors?

• 1040

• 1099

What is an inspection of a filer's tax return by the IRS called?

• Exemption

• Audit

Who is someone you financially support and can be "claimed" on a tax return to reduce your taxable income?

• Dependent

• Earned Income

What term describes any income (wages/salary) that is generated by working?

• Exemption

• Earned Income

What is the set amount of money, per dependent, you can subtract from your taxable income?

• Exemption

• Filing Status

Which federal law requires an employer to withhold taxes from the wages they pay their employees, with funds going toward Social Security and Medicare?

• FICA

• 1099

What defines the type of tax return an individual will use, primarily based on marital status, and determines the size of your tax brackets and how much of your income is taxed at each rate?

• Filing Status

• Earned Income

Which form is used by an employer to verify an employee's identity and to establish that the worker is eligible to accept employment in the United States?

• 1040

• I-9

Taxes paid by employees to federal and state government through a direct deduction from their paycheck

• Income Tax

• Excise Tax