Understanding Business and Tax Concepts

Which term refers to an individual who starts and runs a new business?

• Venture Capitalist

• Founder

• Accredited Investor

• Limited Partner

What is the main purpose of a 401k?

• To pay income tax

• To provide retirement savings

• To report freelance income

• To determine tax brackets

Which form is typically used to report income for independent contractors?

• W2

• 1099

• 401k

• S Corporation

Which type of corporation allows profits and losses to be passed through to shareholders’ personal tax returns?

• C Corporation

• S Corporation

• Limited Partnership

• Sole Proprietor

What does the term "liquidity event" refer to in business?

• A period when trading is not allowed

• An event where assets are converted to cash

• A type of stock

• A tax deduction

Which of the following is a retirement savings plan offered by employers?

• 1099

• 401k

• W2

• Preferred Stock

Which type of stock typically gives shareholders voting rights in a company?

• Preferred Stock

• Common Stock

• Liquidity Event

• Blackout Period

What is the main advantage of a Limited Liability Corporation (LLC)?

• Unlimited liability for owners

• Pass-through taxation and limited liability

• Double taxation

• Only one owner allowed

Which document is used by employees to report their annual wages and taxes withheld?

• 1099

• W2

• 401k

• S Corporation

What is a "tax bracket"?

• A type of investment

• A range of income taxed at a specific rate

• A retirement plan

• A business structure