12-2 Flashcards

1
Q

payroll taxes

A

Taxes based on the payroll of a business

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2
Q

payroll deduction

A

Any amount withheld from an employee’s gross earnings

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3
Q

withholding allowance

A

A deduction from total earnings for each person legally supported by a taxpayer, including the employee.

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4
Q

social security tax

A

A federal tax paid for old-age, survivors, and disability insurance.

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5
Q

Medicare tax

A

A federal tax paid for hospital insurance.

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6
Q

accumulated earnings

A

The total gross earnings year to date for an employee.

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7
Q

tax base

A

The maximum amount of earnings on which a tax is calculated.

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8
Q

qualified retirement plan

A

A retirement savings plan approved by the Internal Revenue Service that provides individuals with a tax benefit.

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9
Q

401(k)

A

A qualified retirement plan sponsored by an employer.

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10
Q

individual retirement account (IRA)

A

A qualified retirement plan that provides most individuals with a deferred federal income tax benefit.

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11
Q

Roth individual retirement account (Roth IRA)

A

A qualified retirement plan that allows tax-free withdrawals from the account.

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