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WorksheetsIncome Benefits and Taxes Test
Total questions: 54
Worksheet time: 28mins
What is the lowest pay rate allowed by law for each regular hour of work?
Overtime pay
Minimum wage
Salary
Commission
What type of payment is made by an employer to an employee on a regular basis, often expressed as an annual sum?
Wages
Tips
Salary
Commission
What is disposable income?
Money earned before taxes
Money available to spend or save after taxes have been paid
Money received as a bonus
Money saved for retirement
Which of the following is NOT a mandatory benefit that employers are legally required to provide?
Social Security and Medicare
Unemployment Insurance
Workers Compensation Insurance
Health Insurance
What is the most important factor to consider when evaluating an employer's compensation package?
The base salary offered for the position.
The availability of paid time off and vacation days.
The employer's contribution to retirement savings plans.
The total compensation package, including both salary and benefits.
What percentage of an employee's Social Security and Medicare contributions is matched by their employer?
25%
50%
75%
100%
What is unearned income?
Money received from working a job
Money received from sources other than working a job
Money received from selling goods
Money received from investments
Which of the following is a form of unearned income from private sources?
Salary
Interest
Freelance earnings
Business profits
Which of the following is NOT a form of unearned income?
Dividends
Pension funds
Individual retirement accounts
Wages
Which of the following is an example of a government transfer payment?
Salary
Financial aid
Business profits
Freelance earnings
What type of tax is a sales tax?
Income tax
Wealth tax
Consumption tax
Property tax
Which of the following is a direct tax based on income?
Sales tax
Use tax
Excise tax
Progressive tax
What is a property tax?
A tax based on the purchase price of goods
A tax based on the assessed value of owned real estate
A tax on the use of goods
A tax on business profits
What is gross pay?
The amount after deductions
Total salary or wages earned during a pay period
The amount of taxes paid
Net pay
What are deductions?
Amounts added to the gross pay
Amounts subtracted from the gross pay
Total salary or wages earned
Net pay
What is net pay?
Total salary or wages earned during a pay period
The amount of your paycheck after deductions
The amount before deductions
The total amount of deductions
What is the tax rate for Social Security Tax?
12.4%
6.2%
1.45%
2.9%
Who pays the Social Security Tax?
Only the employee
Only the employer
Both the employee and the employer
The federal government
What is E-Verify used for?
To calculate taxes
To confirm employees are eligible to work in the U.S.
To determine net pay
To track deductions
What is the purpose of Medicare Tax?
To fund Social Security benefits
To pay for medical care for retired persons aged 65 and older
To support unemployment benefits
To fund workers' compensation
What are FICA Taxes?
Federal and state income taxes
Social Security and Medicare combined
Optional payroll deductions
State-required deductions
Which of the following is an optional payroll deduction?
Income tax
Social Security Tax
Health Insurance
Medicare Tax
What is the primary purpose of filing a tax return?
To apply for a loan
To claim a refund
To register to vote
To open a bank account
When must employers send workers their W-2 forms?
By December 31 of the current year
By January 31 of the following year
By April 15 of the following year
By June 30 of the following year
Which form is used to report taxable income received during the calendar year?
Form 1040EZ
Form 1099-INT
Form W-2
Form 1040A
What is the maximum taxable income allowed to use Form 1040EZ?
$50,000
$75,000
$100,000
$150,000
Which form is designed for single and joint filers with no dependents or itemized deductions?
Form 1040EZ
Form 1040A
Form 1099-INT
Form W-2
What type of income does Form 1099-INT report?
Salary income
Dividend income
Interest income
Rental income
What date must taxes be filed each year?
January 31
March 15
April 15
June 30
What is one advantage of e-filing tax returns?
It is more expensive
Refunds are received slower
Refunds are deposited directly into a bank account
It requires more paperwork
Which form allows more options for entering income, credits, and deductions than Form 1040EZ?
Form 1040
Form 1040A
Form 1099-INT
Form W-2
What is not subject to federal income taxes until withdrawn, usually during retirement?
Salary income
Interest income
Money paid into a 401(k) plan
Dividend income
What is the significance of the tax table provided in the 1040 instructions?
It helps determine your tax liability based on your taxable income.
It lists all the deductions and credits you can claim.
It provides information about your filing status.
It outlines the different income sources you can report.
What is the primary purpose of the second page of Form 1040?
To calculate your total income for the year.
To determine your tax liability.
To report your income sources.
To claim deductions and credits.
What is the significance of the 'standard deduction'?
It's a fixed amount that can be deducted from your taxable income.
It's a specific amount that can be deducted for charitable contributions.
It's a percentage of your income that can be deducted for medical expenses.
It's a fixed amount that can be deducted for mortgage interest.
What does the term "withholding" mean in reference to your paycheck?
The amount of your paycheck that you are NOT being taxed on
How much you are going to owe the government when you file your annual tax return
How much you earn and includes salary, bonus and commissions
How much is being taken out of your paycheck for things like taxes, employer sponsored health insurance, and retirement
Which of the following is NOT considered a government transfer payment?
Social Security benefits
Unemployment benefits
Food stamps
Salaries of government employees
Which of the following is considered an indirect payment to the government?
Income tax
Property tax
Sales tax
Social Security contributions
Which of the following is a direct payment to the government?
Social Security benefits
Income tax
Unemployment benefits
Food stamps
The quality of service provided by a server can significantly affect the amount of tip they receive.
True
False
South Carolina requires its residents to pay state income tax.
True
False
Myrtle Beach and Conway require its residents to pay a city income tax.
True
False
Taxpayers can choose to itemize their deductions if their total allowable itemized deductions are greater than their standard deduction.
True
False
Independent contractors typically receive a Form 1099 from the businesses that pay them for their services.
True
False
Part-time employment is typically defined as working between 20 to 25 hours per week.
True
False
Match the list of tax forms letters with their descriptions: I am received in January. There is one of me for every job you work. You can tell how much you earned and how much you paid in taxes by reading me.
(a)
Match the list of tax forms letters with their descriptions: I am received in January. You get me if you are not an employee, but were paid by a company. You can also get me for other types of income, such as gains and losses in brokerage accounts, dividend and interest payments, and more. You probably didn’t get taxes withheld if you got me, so you may have a big tax bill coming up.
(a)
Match the list of tax forms letters with their descriptions: I am completed every April. Anyone can use me. Beware, there is a LOT to fill out.
(a)
I am a...
(a)
I am a...
(a)
Money paid to an employee on an hourly basis is
A wage
A salary
Compensation
A commission
Income paid as a percentage of sales made by a salesperson is called ________________.
commission
salary
hourly wages
goals
Income received from employment is called ________.
earned income
a job
tax write-off
a career
Money that a person has available to spend or save after taxes are paid is:
earned income
disposable income
wages
salary
