Income Taxes

Which of the following statements is TRUE?

• Many people are able to cheat the government and avoid paying taxes by using phony deductions or failing to report their income appropriately.

• Taxes paid provide services that impact only quality of life in the United States, not the standard of living.

• Everyone who receives a paycheck is required to submit a tax return to the IRS by April 15.

• Individuals do not have to pay taxes if they believe it is a violation of their religious beliefs.

If people in Group A are taxed MORE than people in Group B, it may

• decrease Group A’s incentive to earn more money

• have no effect on either group’s incentive to earn more money

• increase the Group B’s incentive to earn more money

• increase Group A’s incentive to earn more money

The federal income tax has different tax bracket percentages and income levels for single individual. As a result of this practice,

• the federal income tax is based on the benefits-received theory of taxation

• you pay different percentages of taxes as your income increases

• all of your income is taxed at the highest percentage rate

• the federal income tax is a regressive tax

The ability to pay tax principle says that

• people who can afford to pay taxes should pay more than those with limited ability to pay

• people who use certain public goods and services should pay for them with taxes

• the proportion of income paid in taxes decreases as income decreases

• the proportion of income paid in taxes increases as income increases

Oklahoma has a _____ income tax system.

• outdated

• passive

• progressive

• regressive

Employees receive a form from their employers each year with information required for their federal income taxes. This form is called a

• W2

• WD40

• CPD2

• NP4

The Internal Revenue Service (IRS) is the federal government agency responsible for:

• Keeping the unemployment rate low

• Writing tax laws

• Filling out your tax forms

• Tax collection and tax law enforcement

The day that income tax filings are due in the United States:

• June 15

• December 1

• April 15

• January 1

When a company hires you, you will fill out a ________ form. The information on this form is the

basis for determining how much income tax should be withheld from your paycheck.

• 1040EZ

• W-2

• 1040

• W-4

What is the primary purpose of income taxes in a society?

• To fund public services and infrastructure

• To penalize high earners

• To encourage savings

• To control inflation