Worksheets10.4 Q individual #4-11deductions, filing returns
Total questions: 40
Worksheet time: 3hrs 29mins
Put these in order of highest to lowest
1) (a)
2) (b)
3) (c)
https://drive.google.com/file/d/1_6aSqVHqMn5dgfNVZDoHLvJ4wxVzGVdN/view
Adjusted gross income - (a) = taxable income
Tax bill - (b) = Final tax bill
https://drive.google.com/file/d/1_6aSqVHqMn5dgfNVZDoHLvJ4wxVzGVdN/view
According to this example, your (a) will be lower if you have a $10,000 (b) . A $10,000 (c) will reduce your taxable income but your tax bill would be higher.
https://drive.google.com/file/d/1_6aSqVHqMn5dgfNVZDoHLvJ4wxVzGVdN/view
Which of these is deducted from your AGI? (a)
https://drive.google.com/file/d/1_6aSqVHqMn5dgfNVZDoHLvJ4wxVzGVdN/view
Which of these is deducted from your calculated tax bill? (a)
Would you rather want to take a tax deduction or a tax credit?
Tax deduction
Tax credit
Not sure
When filing your tax return, you can lower your tax bill by claiming a tax deduction. You can either:
Take the standard deduction: a large, fixed dollar amount determined by federal government that tax year,
OR
Itemize your deductions: the government provides a list of hundreds of smaller deductions, and you deduct all those that you qualify for. This usually takes longer, and you need written proof for every deduction you are claiming.
Why would someone itemize deductions instead of using the standard, fixed amount?
If the total itemized deductions are higher than the fixed standard deduction
If the fixed standard deduction is higher than the itemized amount
If the standard deduction increases for that tax year
If they want to look good to the IRS and would like an audit
https://taxfoundation.org/wp-content/uploads/2020/07/Tax-Basics-How-Is-Tax-Liability-Calculated.png
In order to have a lower taxable income, which should this person choose?
itemized
standard
don't pay taxes this year
one person can be taxed in a few different tax brackets.
all of your money is always taxed at one percent in one bracket.
in scenario 1, this person would pay 22% tax on $100,200 which is $22,044.
in scenario 2, this person would pay 10% tax on $97,000 which is $9,700.
https://taxfoundation.org/wp-content/uploads/2020/07/Tax-Basics-How-Is-Tax-Liability-Calculated.png
If this person wants the lowest tax liability (lowest amount of money to pay for taxes), what should they do?
itemize deductions.
use the standard deduction.
What are the drawbacks of the standard deduction? You might not take it if
married filing separately and your spouse itemizes
you are claimed as a dependent by someone
the standard deduction might be lower than an itemized deduction
the standard deduction might be lower than your gross income so you do not have to file
you have to subtract the itemized deduction from the standard deduction
https://www.creditkarma.com/tax/i/filing-state-income-taxes
Does MICHIGAN require you to file a state income tax return?
Yes
No
https://www.creditkarma.com/tax/i/filing-state-income-taxes
Select all states below that have no income tax.
Alaska
Florida
South Dakota
Michigan
Ohio
You have to file a tax return for the federal government and the state if you live in Michigan.
True
False
If you are e-filing your tax returns, explain why it is beneficial to file your federal and state taxes through the same e-filing service.
You (a) have to file separate returns, one for federal taxes and one for the (b) , if you e-file because the returns will be (c) .
8)
https://pocketsense.com/happens-mistakes-tax-return-19664.html
How will you know if there was an error on your tax return and the IRS has made a change? Select all that apply.
your refund amount may change
you will receive a letter about your mistakes
they will always fine you 5% of your tax refund
you will definitely go to jail
if your refund is adjusted you will have to respond with a letter back to the IRS
What should someone do first if they do not agree with the adjustments the IRS made?
write a nasty letter
call the IRS
complain about the how this is the president's fault
10) Under which of these circumstances would you incur fees from the IRS? (Select all that apply)
When you owe taxes and filed your tax return 3 days after the filing deadline.
When you are owed a tax refund and you file 3 days after the filing deadline.
When you owe taxes and fail to pay the amount owed by the tax deadline.
https://ttlc.intuit.com/turbotax-support/en-us/help-article/taxation/irs-penalty-miss-april-18-filing-deadline/L8nJR52P5_US_en_US
Complete this sentence: Failing to file your tax return is (a) severe than failing to pay back any taxes you owe. If you fail to file your tax return, you will be charged (b) per month, whereas if you fail to pay any taxes you owe, you will be charged (c) per month.
less
https://www.irs.gov/taxtopics/tc202
If you can't pay your taxes that are due, what should you do? Will you end up paying more or less in the end if you cannot pay up front?
Google: If you are owed a tax refund, you have ________ to file your tax return. After that, it belongs to the treasury.
3 years
3 days
3 months
7 years
5 years
Let's say we all got a tax refund this year. What would you do with it?
Now, think about yourself as a 22-year old. How would you spend your tax refund?
https://drive.google.com/file/d/1_6aSqVHqMn5dgfNVZDoHLvJ4wxVzGVdN/view
REVIEW: Adjusted gross income - (a) = taxable income
Tax bill - (b) = Final tax bill
Look at this W-2. What is the employee's name?
Borris
High-Five
Marcus
Look at this W-2. What was his income (wages)? No commas. No dollar signs.
(a)
Look at this W-2. How much federal income tax was withheld? No commas, no dollar signs, no cents.
(a)
Over $5,000 was withheld, is this per month or per year?
month
year
Did he pay state income tax?
No
Yes
https://drive.google.com/file/d/1zVXkvPyj2LIfai2Ba6X6eFPfWcBrZlXk/view?usp=sharing
Open his 1040. What is his filing status?
Blind
Single
Married jointly
Married separate
HOH
https://drive.google.com/file/d/1zVXkvPyj2LIfai2Ba6X6eFPfWcBrZlXk/view?usp=sharing
How many dependents is he claiming?
(a)
https://drive.google.com/file/d/1zVXkvPyj2LIfai2Ba6X6eFPfWcBrZlXk/view?usp=sharing
What exact line does he put "Total amount from Form(s) W-2, box 1"? (number and letter)
(a)
https://drive.google.com/file/d/1zVXkvPyj2LIfai2Ba6X6eFPfWcBrZlXk/view?usp=sharing
Did he do itemized or standard deduction?
itemized
standard
not enough info
https://drive.google.com/file/d/1zVXkvPyj2LIfai2Ba6X6eFPfWcBrZlXk/view?usp=sharing
What is his taxable income? No commas, no dollar signs, no cents.
(a)
https://drive.google.com/file/d/1zVXkvPyj2LIfai2Ba6X6eFPfWcBrZlXk/view?usp=sharing
Which is higher, AGI or taxable income?
AGI
taxable
they are equal
https://drive.google.com/file/d/1zVXkvPyj2LIfai2Ba6X6eFPfWcBrZlXk/view?usp=sharing
What is the total tax he owes on line 24?
(a)
https://drive.google.com/file/d/1zVXkvPyj2LIfai2Ba6X6eFPfWcBrZlXk/view?usp=sharing
Will he get a refund or have to pay taxes?
pay
refund
neither
https://drive.google.com/file/d/1zVXkvPyj2LIfai2Ba6X6eFPfWcBrZlXk/view?usp=sharing
What should he do right now?
change his W-4 to withhold more taxes
nothing he's good
just go in hiding so he doesn't have to pay
