Taxes Review

Health expenses funded by federal income taxes.

• Medicare and Medicaid

• Private health insurance

• Out-of-pocket expenses

• Employer-sponsored health plans

W-2 Form

• A form that reports an employee's annual wages and the amount of taxes withheld from their paycheck.

• A document used to report self-employment income.

• A form for filing personal income tax returns.

• A statement of earnings for independent contractors.

Employer Contributions

• Contributions made by an employer to an employee's retirement plan.

• Payments made by employees to their own retirement accounts.

• Bonuses given to employees based on performance.

• Funds allocated by the government for employee training.

Freelancers or contractors are considered self-employed.

• They must manage their own taxes and benefits.

• They receive a fixed salary from an employer.

• They are entitled to paid vacation days.

• They work only part-time hours.

401(k)

• A retirement savings plan sponsored by an employer.

• A type of insurance policy.

• A government tax incentive for home buyers.

• A loan program for small businesses.

A person whose income falls in the 24% tax bracket will pay a total of 24% of their income in taxes.

• True

• False

• 30%

• 20%

1040 Form

• A tax form used for individual income tax returns in the U.S.

• A form for corporate tax returns in the U.S.

• A form used for reporting foreign income to the IRS.

• A form for estate tax returns in the U.S.

Net Pay

• The total earnings before any deductions.

• The amount of money you take home after all deductions are made from your gross pay.

• The amount deducted for taxes and other withholdings.

• The gross pay minus only the voluntary deductions.

FICA Taxes

• Federal Insurance Contributions Act taxes that fund Social Security and Medicare.

• Federal Income Tax Act taxes that fund unemployment benefits.

• Federal Insurance Contributions Act taxes that fund public education.

• Federal Income Contributions Act taxes that fund healthcare for veterans.

Taxable Income

• The total income before any deductions.

• The portion of your income that is subject to income tax after deductions and exemptions.

• The amount of money you save on taxes each year.

• The income that is not subject to any tax.