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Taxes Review

Total questions: 35

Worksheet time: 18mins

Name
Class
Date
1.
How does paying taxes benefit you? (What does the government provide for you)?
4 lines
2.
Grace has decided to e-file her taxes this year. Why should she file her state and Federal taxes together through the same software?
a)
Both tax returns are actually reviewed by the Federal government, so filing them together expedites the process.
b)
If she files them together, she's more likely to receive a larger refund or get a tax credit.
c)
A majority of e-filing software companies provide a significant discount if you file both returns together.
d)
Grace will have just one submission ID, which makes it less likely that the state will reject her state tax return.
3.
Why should you accurately complete a W-4 form any time you start a new job or change your tax status?
a)
You need a copy of your W-4 to file your tax return annually
b)
Your W-4 determines how much Federal income tax money your employer should withhold
c)
Your W-4 determines your total tax bill at the end of the year
d)
Completing a W-4 will guarantee you receive a large tax refund
4.
Jay filed his taxes and found out he owes money. What is the most reasonable explanation as to why she owes money in taxes?
a)
Not enough money was withheld from his paychecks.
b)
Too much money was withheld from his paychecks.
c)
When filing his taxes, Jay accidentally checked “Married filing jointly” instead of “Single”.
d)
The IRS is asking Jay for a future advance on his possible taxes for next year.
5.
The Federal government spends the most amount of tax money on...
a)
Science
b)
Veterans
c)
Education
d)
Health
6.
Which of the following people might want to claim EXEMPT on their W-4 form?
a)
John, who is 20 and expects to earn $12,850 from his internship.
b)
Stacey, who is 16 and expects to earn $7,500 from her part-time job.
c)
David, who is 23 and expects to earn $15,000 from his part-time job.
d)
Hannah, who is 25 and expects to earn $55,000 from her full-time job.
7.
All of the following are factors that impact the amount someone may pay in taxes EXCEPT...
a)
Income
b)
Political party
c)
State
d)
Marital status
8.
Tamara found out that she owes $3,200 in taxes. She cannot afford to pay the entire amount right now, so she is going to arrange an installment plan with the IRS. What is the one thing that Tamara should be prepared for?
a)
She'll have to redo her tax return so that she can note she'll be using an installment plan.
b)
She will pay more than $3,200 because she will be paying additional money in interest with each payment.
c)
Her credit score may decrease because of her inability to pay back the total she owes to the IRS.
d)
She will have to meet an earlier tax filing deadline next year in case she owes money again.
9.
Which of the following is the largest source of income for the Federal government?
a)
Payroll tax
b)
Income tax
c)
Corporate tax
d)
Property tax
10.
Which person should expect to receive a W-2 form from their employer by January 31st, 2021?
a)
Marcy, who has sold handcrafted vases online for the past 5 years
b)
Jose, whose first job started on January 10, 2021
c)
Arnie, who did an unpaid internship in summer 2020 for a local newspaper
d)
Kelly, who has worked for the same department store for the last 15 years
11.
Which of the statements about the current U.S. tax system is TRUE?
a)
Our current system is described as being a progressive system because it imposes higher rates on those who earn more.
b)
Your friend tells you his marginal tax rate is 22%. That means that he pays 22% on all of his income.
c)
Everyone in the US who makes more than $12,400 pays one flat tax rate.
d)
Our current system is described as being a regressive system because it imposes higher rates on those who earn less.
12.
Jeremy just started a new job and completed his W-4 form. Who should he submit it to?
a)
His employer
b)
His spouse
c)
The IRS
d)
No one - he keeps it for his records
13.
All of the following information should appear on your W-2 form EXCEPT...
a)
Your name, address, and employer information
b)
Your interest earned on savings and investments
c)
Your wages, tips, and compensation from that particular employer
d)
The amount you paid during the last year for Medicare and Social Security
14.
Who is legally required to file a tax return? (Note: All of the following people can be claimed as a dependent.)
a)
Madison, who earned $350 from her cake business.
b)
Matthew, who received $800 in investment income.
c)
Greg, who earned $1,250 from his part-time job.
d)
Risha, who earned $14,600 from her internship.
15.
Samantha was able to lower her overall tax burden by directly reducing the amount of money she owes to the IRS. Which of the following most likely explains what happened?
a)
She received tax CREDITS.
b)
She claimed EXEMPT on her W-4 form.
c)
She received a tax DEDUCTION.
d)
She is considered a household employee, and is therefore exempt from self-employment taxes.
16.
When is "Tax Day", the deadline to file your taxes?
a)
January 1
b)
April 15
c)
December 31
d)
Whatever day your tax refund comes in the mail
17.
Which statement about filing a tax return is FALSE?
a)
Paper filing your tax return is free, but it takes a lot longer to process and get back a refund if you are owed one.
b)
Filing with a tax professional may be good for those people who got a divorce, bought a house, or changed their financial situation in another major way.
c)
People who are not familiar with filing taxes should not use e-filing software, because there is no access for support if they need it.
d)
Filing with a tax professional is often the method that is most susceptible to scams.
18.
A dependent is someone who...
a)
relies on someone else to provide a quarter or less of their financial support.
b)
relies on someone else to provide more than half of their financial support.
c)
is able to financially support themself fully.
d)
provides financial support for someone else.
19.
When you sit down to file your 1040 form, which document(s) should you have in front of you?
a)
W-2 form(s)
b)
W-4 form(s)
c)
I-9 form(s)
d)
Checking account statements from last year
20.
All of the following are ways to pay any taxes you owe EXCEPT...
a)
Using your debit or credit card to make an online payment
b)
Sending a check
c)
Make a payment directly from your bank account
d)
Use an app or website like PayPal or Venmo
21.
Which of the following high schoolers would be considered a self-employed contractor?
a)
Kelly, who makes homemade jewelry in her spare time and sells them through her online store.
b)
Amy, who babysits during the week and weekends.
c)
Shrini, who mows lawns for his neighbors after school.
d)
Joel, who delivers his neighborhood's newspapers on weekday mornings.
22.
What form do you use to file a tax return with the IRS?
a)
W-2
b)
W-4
c)
1040
d)
I-9
23.
Which is a type of EARNED income?
a)
Social Security Benefits
b)
Retirement Account Distributions
c)
Money Received from Bonuses
d)
Unemployment Compensation
24.

According to the IRS, Social Media Influencers are considered _____

a)

Part-time Employees

b)

Independent Contractors

c)

Freelance Employees

d)

Side Hustlers

25.

Everyone who has a job or once you turn 18 should file a tax return every year.

a)

True

b)

False

26.

A tax is a ____

a)

is a form or forms filed with a tax authority that reports income, expenses, and other pertinent tax information. Tax returns allow taxpayers to calculate their tax liability, schedule tax payments, or request refunds for the overpayment of taxes.

b)

Calculates the total amount of income per pay period following deductions (taxes, social security, retirement, and insurance)

c)

A charge usually of money imposed by authority on persons or property for public purposes

d)

manages federal finances by collecting taxes and paying bills and by managing currency, government accounts and public debt. The Department of the Treasury also enforces finance and tax laws.

27.

What information does a W-2 form include?

a)

Your filing status and dependents.

b)

The amount of money you've earned from self-employment.

c)

The total amount of taxes withheld from your paycheck.

d)

Your bank account information.

28.

What is the purpose of the W-2 form?

a)

To report your annual earnings and taxes withheld from your paycheck to the IRS.

b)

To calculate your state taxes.

c)

To itemize your deductions.

d)

To report earnings from self-employment.

29.

When is the W-2 form typically issued by employers?

a)

By January 31st of the following year.

b)

At the end of each quarter.

c)

By April 15th of the following year.

d)

Upon the employee's request at any time.

30.

Which of the following is NOT an example of liability?

a)

Wages owed to employees

b)

Dividends owed to stockholders

c)

Taxes owed to government

d)

Revenue received from customers

31.

Five months ago, Korey bought 500 shares of stock at $25 per share. Today, he sold all 500 shares for $48 per share. What type of tax is Korey obligated to pay as a result of this financial transaction?

a)

capital gains tax

b)

luxury tax

c)

excise tax

d)

sales tax

32.

Withholding too much in taxes will result in:

a)

owing money during tax season

b)

allowing the government to borrow your money interest-free

c)

a higher paycheck

d)

none of these

33.

Withholding too much in taxes will result in:

a)

owing money during tax season

b)

a tax refund

c)

a higher paycheck

d)

none of these

34.

Why should you complete a W-4 form any time you start a new job or change your tax status?

a)

You need a copy of your W-4 to file your tax return annually

b)

Your W-4 determines how much Federal income tax money your employer should withhold

c)

Your W-4 determines your total tax bill at the end of the year

d)

Completing a W-4 will guarantee you receive a large tax refund

35.
A health care program for the elderly and disabled
a)
social security
b)
medicare
c)
state income tax
d)
federal income tax

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