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WorksheetsCrystal Clear Tax Test
Total questions: 71
Worksheet time: 1hrs 7mins
What item would you DEFINITELY see on a paystub?
Retirement
Healthcare
Gross Pay
Your occupation/role
True or False: A teen's earned income can be reported on a parent's tax return.
True
False
Luisa earned $1,200 at her part-time job, and $500 from babysitting in cash. Which is TRUE?
She will report her total income as $1,700.
She will report her total income as $1,200.
She will report her total income as $500.
Luisa is required to file a tax return.
Who primarily uses our tax money? (hint: choose 2 correct answers)
Your employer
Large corporations
Federal and state government
Local Businesses
Our tax money is spent on all of the following EXCEPT:
Social Security
The Military
Private School Education
National Parks
Which of the following is NOT a category in the Federal government's spending?
Mandatory spending
Discretionary spending
Interest on loans issued
Interest on national debt
Which of the following taxes is applied to wages, salaries, dividends, and interest earned?
Corporate Income Tax
Income Tax
Estate Tax
Excise Tax
The W-4 form lets...
the government know how much you paid in taxes last year
your employer know how much to withhold from your paycheck
the 3 major credit bureaus know how many dependents you have
you know how much you paid in taxes last year
Jess is 21, in college, & has a job that provides 65% of her support. Is she a dependent?
Yes
No
What item would you DEFINITELY see on a paystub?
Retirement
Healthcare
Gross Pay
Your occupation/role
By claiming "exempt" on the W-4 form...
You are paying all income taxes upfront at the START of the year.
You are requesting an extension to file your taxes
You will NOT have income taxes withheld from your paycheck.
You are paying all income taxes at the END of the calendar year.
Jason filed his 2022 tax return and owes money. If he doesn't want to pay a fee, when should he pay this amount by?
April 18th
October 15th
December 31st
January 1st of the next year
True or False: All wages, tips, and bonuses are taxable unless specifically excluded.
True
False
Which of the following things is TRUE about the W-2 form EXCEPT...
You get 1 W-2 form every year, even if you had multiple jobs
It contains information you'll need to fill out a 1040
It lets you know how much you earned last year
It lets you know how much was withheld from your paychecks
Jason is 15 and earned $1450 at his job last summer. Should he file a tax return?
No, because he didn't earn enough.
No, because you have to be 16 and older to file taxes.
Yes, because he may get a refund.
Yes. You must file taxes even if you didn't earn enough.
What do you need to file your 1040 form?
Your W-2
Your W-4
Your prior year's tax return
Income of $50,000 or more
Which of the following is NOT a way you can file your taxes?
Through a tax professional
Mailing in a paper tax return to the Federal government
Using tax software like TurboTax
Through your employer's HR department
True or False: A teen's earned income can be reported on a parent's tax return.
True
False
If a teen files a tax return, can the parent still claim him/her as a dependent?
Yes. All teens are dependents until they are 18 years old
No. If a teen files a tax return, he/she cannot be claimed
Yes, as long as the teen meets the dependency requirements
Yes, but the parent has to add the teen's income to theirs
Luisa earned $1,200 at her part-time job, and $500 from babysitting in cash. Which is TRUE?
She will report her total income as $1,700.
She will report her total income as $1,200.
She will report her total income as $500.
Luisa is required to file a tax return.
Earned income is any money you make from things like interest and dividends.
True
False
If you owe taxes, which of the following is FALSE?
You can make a payment using cash
You can delay your payment deadline
With an agreement, you can pay it in installments
You can make a payment with a debit, but not credit card
Which is TRUE if you do not pay your taxes?
You owe twice as much the following year
You're more likely to be approved for low interest loans
You cannot go to jail (but you will be heavily fined)
Your credit score may be impacted
Ken, a single taxpayer, has a gross income of $79,685. He claims one exemption and can take a deduction of $1,257 for medical expenses, a deduction of $2,181 for interest on his mortgage, an adjustment of $800 for alimony, a deduction of $1,419 for property taxes, an adjustment of $1,722 for business expenses, and an adjustment of $2,511 for contributions to his retirement fund. The standard deduction for a single filer is $5,700, and exemptions are worth $3,650 apiece. Using the table below, how much does Ken owe in income tax?
$12,663
$12,825
$12,675
$12,838
Who should fill out the W-2 form?
the taxpayer’s employer
the taxpayer
a qualified tax professional
the IRS
Sandy and Alex are married, with no dependents. They wish to file a joint tax return. Both of them work, but their combined salaries only put them at a slightly above-average income. They would also like to deduct interest paid on their student loans. Recommend an appropriate 1040 form for Sandy and Alex to fill out. (Answer: 1040 A)
1040
1040-EZ
1040-2
1040-A
What is the difference between a tax credit and a tax deduction?
A tax credit represents money owed to you, while a tax deduction represents money you owe.
A tax credit reduces the amount of money you must pay, while a tax deduction reduces your taxable income.
A tax credit is owed money that collects interest, while a tax deduction is money that you do not have to pay.
A tax credit occurs if you underpaid during the year, and a tax deduction occurs if you overpaid.
A tax return is...
Money you get back for working really hard
a report containing information used to calculate taxes owed by the taxpayer
The Internal Revenue Service (IRS)
Not filing a tax return is a crime.
True
False
_________________ is the primary source of revenue for the federal government.
Individual income tax
sales tax
food
What does voluntary mean?
Done, given, or acting by force. You do not have a choice.
Done, given, or acting of one's own free will. By choice.
Filing status is a category that determines which tax form to use and the tax liability. It is based on your...
job
marital status
unemployment
house
The Wage and Tax Statement, which shows a person’s earnings and the amounts of income, is also known as the Form _-_.
W-2
1099
W-4
•Taxable income is the amount on which taxes are calculated.
True
False
__________ is calculated by subtracting adjustments from total income.
net pay
gross pay
adjusted gross income
taxable income
Adjusted gross income is calculated by subtracting adjustments from total income. If your total income was $34,000 and your adjustments are $2,000. What is your adjusted gross income?
$33,000
$32,000
$31,500
A tax deduction is....
an amount of extra taxes to pay
an amount that is added to adjusted gross income
an amount that is subtracted from adjusted gross income
Two types of tax deductions are:
(Choose 2)
itemized deduction
income deduction
tax beak
standard deduction
An amount that a taxpayer can claim for each person who is dependent on that person’s income is called an ________.
tax break
exemption
liability
A dependent is...
an adult individual who pays taxes and takes care of themselves
someone who is lazy
an individual who relies on someone else for financial support, such as a child, a spouse, or an elderly parent.
Your tax liability is..
the amount of total tax owed on income for the year.
the amount of tax income you saved.
the number of dependents you have.
What information do you think is required for an individual to complete a tax return?
A dependent is...
Someone who is lazy
Someone who works hard
an adult individual who pays taxes and takes care of themselves
an individual who relies on someone else for financial support, such as a child, a spouse, or an elderly parent
List three basic forms used to file income taxes.
1040, 1040A, 1040EZ
1040, 1040EZ, 1099
W-2,W-4, W-12
I-35, 290, Mopac
Ellie is a 21 year old full-time college student. She earned $12,500 at her year-long internship. Can she be claimed as a dependent?
Yes
No
As taxable income decreases, income tax _____.
Decreases
Increases
Remain the same
You move up in _____ as your taxable income increases.
tax brackets
credits
refund amount
allowances
On the Roger's year 2022 1040 tax return, Tax Line 24 exceeds Total tax payments Line 33. Does Roger have a refund or amount owed?
owes money to the IRS
should increase his payroll allowances
will get a refund
should increase his salary
William received a letter in the mail from the IRS requesting tax documentation. Which term describes this process?
Audit
Tax evasion
Tax exemption
Proportional tax
Which entity has the power to create or alter federal income tax and tax laws?
Congress
Supreme Court
Internal Revenue Service
State governor
Which of the following is NOT on the 1040EZ?
Wages, salaries, and tips
Taxable income
Head of the household tax filing status
Earned Income Credit (EIC)
On your tax return, which of the following is EXCLUDED from gross income on a tax return?
Unemployment compensation
Child support you receive
Interest earned on a Certificate of Deposit (CD)
Tips
Your paycheck is largest if you elect which of the following allowances on your Form W4? (Ch2)
4
2
5
3
____ is the deadline to file your tax return.
January 31
January 1
December 31
April 15
Which of the following is NOT included in gross income (on your tax return)?
Wages
Tips earned as wait staff
Interest earned on savings/ bonds
Alimony you paid
