Taxation Quiz

Which government body is responsible for collecting income taxes in the United States?

• IRS

• FBI

• CIA

• NSA

Which of the following is considered earned income?

• Birthday money

• Allowance

• Wages from a job

• Stock dividends

What type of tax is based on the taxpayer's ability to pay?

• Regressive tax

• Proportional tax

• Progressive tax

• Sales tax

Which of the following taxes are calculated based on the salaries paid to employees?

• Income tax

• Payroll tax

• Property tax

• Sales tax

What is a tax credit?

• An amount subtracted from taxable income

• An amount added to taxable income

• An amount subtracted directly from taxes owed

• An amount added directly to taxes owed

Which form is commonly used to report income for employees in the United States?

• W-4

• W-2

• 1099

• 1040

What does an exemption allow you to do?

• Subtract a specific amount from your taxes

• Subtract a specific amount from your income

• Add a specific amount to your income

• Add a specific amount to your taxes

Which type of income is earned without directly having to work for it?

• Wages

• Salary

• Unearned income

• Overtime pay

Which type of tax applies the same percentage to everyone regardless of income?

• Proportional tax

• Progressive tax

• Regressive tax

• Sales tax

What is the term used for the money you take home after all deductions?

• Gross pay

• Net pay

• Overtime pay

• Bonus pay