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BASIC PERSONAL INCOME TAX. 3

Total questions: 20

Worksheet time: 20mins

Name
Class
Date
1.

The filing status with the highest standard deduction is

a)

single

b)

married filing a joint return

c)

married filing a separate return

d)

head of household

2.
The form _______tells you how much was taken out of your pay for the year.
a)
W-2
b)
W-4
c)
1040
d)
1040EZ
3.
You should keep your tax records for how long in case of an audit?
a)
10 years
b)
20 years
c)
1 year
d)
3-5 years
4.
To get your refund, which is faster: Direct Deposit or by Mail?
a)
Mail
b)
Direct Deposit
5.
Filling out the form ________ tells your employer how much to take off of your pay each week.
a)
W-2
b)
W-4
c)
1040EZ
d)
1040
6.
IRS stands for what when talking about taxes?
a)
Internal Revenue Service
b)
Individual Return System
c)
I'm Really Sorry
d)
International Revenue System
7.

The Standard Deduction for being Single is what?

a)

8,000

b)

12,000

c)

18,000

d)

24,000

8.
What is the filing status for someone who has a child but is not married?
a)
Single
b)
Head of Household
c)
Super Mom/Dad
d)
Married -Filing Separate
9.
A tax credit is taken
a)
in determination of taxable income.
b)
as a deduction against tax liability.
c)
on Schedule A as an itemized deduction.
d)
is only available on Schedule SE - self-employment income.
10.
The earned income credit:
a)
is refundable.
b)
attempts to provide income tax equity to the working poor.
c)
increases depending on the number of qualifying children.
d)
All of these answers are correct.
11.
The Lifetime Learning Credit
a)
is only available for the first 4 years of higher education.
b)
is a flat amount of $2,500.
c)
is available for taxpayers who are beyond the first 4 years of higher education.
d)
can be taken in the same year as the American Opportunity Tax Credit.
12.

Select three items that can be used as itemized deductions

a)

Medical and Dental Expenses

b)

Home Mortgage Interest

c)

State and Local Taxes

d)

Personal Food and Rent Expenses

13.

The Child Tax Credit amount for a dependent child under 17 is

a)

2,500

b)

1,500

c)

2,000

d)

500

14.

When total tax payments are greater than the total tax, taxpayers has a(n)

a)

Amount Due

b)

Equal Balance

c)

Refund

d)

Credit

15.

A taxpayer can use their refund to (select all the apply)

a)

buy U.S. Treasury Securities

b)

buy U.S. Series I Savings Bonds

c)

Save in a retirement program

d)

Buy a Gucci bag

16.

What information do you need to Direct Deposit your refund? (select all that apply)

a)

Routing number (nine digits)

b)

Account Balance

c)

Account Number

d)

Check Number

17.

Only taxpayers who file electronically can pay an amount due by:

a)

check

b)

credit card

c)

money order

d)

Electronic funds withdrawal (direct debit)

18.

Which is not a benefit of a direct deposit of a refund?

a)

There is a convenience fee for having a refund deposited directly into a bank account.

b)

Refunds that are directly deposited to an account in a bank account are received faster than by mail.

c)

Refunds that are directly deposited to an account in a bank account save taxpayer time by eliminating trips to financial institutions.

d)

Refunds made by direct deposit cost less than issuing checks.

19.

When the total tax is greater than the total tax payments, taxpayers has a(an)

a)

Amount due

b)

Refund

c)

Tax Credit

d)

Tax Proportion

20.

Taxpayers who cannot make payment for an amount due in full need to

a)

Send their tax return and wait for the IRS to send a bill

b)

Report to tax debtor prison

c)

Contact the IRS to discuss payment options

d)

Leave the USA, change their names, and never come back