Chapter 9 Quiz

What are taxes?

• A loan to the government with a return

• A law stating how much of your earned income or profits the government takes to contribute to society

• How much credit is available on your credit card

• A fee included on your bill. (service fee, shipping fee, etc.)

A reduction of your taxable income

• Tax avoidance

• Tax evasion

• Tax deduction

• Tax credit

The amount of money you 'make' before taxes and deductions

• Net Income

• Gross Income

Surtaxes are....

• A tax paid for the sale of surtain goods or services

• Any money you still owe after filing your Form 1040

• Any money owed to you after filing your Form 1040

• Additional taxes paid by higher earners for certain programs

What is tax avoidance?

• Building a plan to U.S.E taxes and reduce your tax liability

• Attempting to trick or defraud the IRS into not paying your taxes

• Avoiding taxes

• Avoiding the process of determining the money you owe by hiring a tax professional

Tax ___________ are the groups that determine what fraction of your income you pay in taxes based off of which group your income falls into. (lowercase)

What is the highest percent that can be taxed off of someone's income?

• 35%

• 61%

• 37%

• 25%

What is the difference between a tax credit and a tax deduction?

• A tax credit is applied to your total taxable income, while a tax deduction is applied to the tax money you owe

• A tax credit is applied to the tax money you owe, while a tax deduction is applied to your total taxable income

• A tax credit gives you a free pass off of your taxes, while a tax deduction reduces your rate

• A tax credit is a tax on your credit card, while a tax deduction is a tax on your deductables

Which tax document is sent to an employee at the end of the year which summarizes what they were paid during the year?

• Form 1098

• W9

• W4

• W2

What do taxes do for society?

• Fund schools

• Fund public services

• Fund Medicare, Medicaid, and Social Security

• All of the above