busniss final 2 Flashcards
(25 cards)
Which of the following have typically been the three largest categories of federal
government spending?
A. Infrastructure, Defense, and Science
B. Health, Military, and Interest on Debt
C. Veterans, Infrastructure, and Education
D. Education, Defense, and Food/Agriculture
Health, Military, and Interest on Debt
What does the term “withholding” mean in reference to your paycheck?
A. It is the amount of your paycheck that you are NOT being taxed on.
B. It is how much is being taken out of your paycheck in taxes.
C. It is how much you are going to owe the government when you file your
annual tax return.
D. It is how much you earn and includes salary, bonus, and commissions.
It is how much is being taken out of your paycheck in taxes.
Why is it important to be extremely careful when completing your 1040 form?
A. Making even one mistake on your federal taxes can result in your being
convicted of a crime.
B. The 1040 form determines whether you owe additional taxes or are entitled to
receive a refund from the government.
C. Completing the 1040 incorrectly will mean the wrong amount of taxes will be
withheld from your paychecks going forward.
D. Mistakes on your 1040 form make you ineligible for unemployment during the
next year
B. The 1040 form determines whether you owe additional taxes or are entitled to
receive a refund from the government.
You are starting your first job and you are asked to complete some paperwork on your
first day. Which form will determine how much money is withheld from your paycheck
for federal and state income taxes?
A. W-2
B. W-4
C. I-9
D. 1040
W-4
Which of the following paycheck withholdings puts money into a retirement investment
fund that you will manage?
A. Social Security
B. Medicare
C. 401(k) contribution
D. Federal income taxes
C. 401(k) contribution
When determining whether you NEED to file a federal tax return, each of these
questions matters EXCEPT:
A. How much income did you earn this year?
B. What type of income did you earn this year?
C. What state do you live in?
D. Are you claimed as a dependent on anyone else’s tax return?
C. What state do you live in?
Juanita has a part-time job that pays $12/hour and works about 50 hours every month.
Her withholdings are social Security (6.2%), Medicare (1.45%), and federal income tax
(10%). What is her approximate net pay every month?
A. $120
B. $500
C. $600
D. $700
500
What form am I? I am received when you start a job. You use me to prove that you are
eligible to work in the U.S., and you must provide forms of identification when
submitting me.
A. I-9
B. 1099
C. 1040
D. W-4
I-9
Upon completing your 1040, you realize that you owe the IRS $427. Each of the
following is a possible way to pay the taxes you owe EXCEPT:
A. Write a check and mail it to the IRS.
B. Tell the IRS to take out more taxes next year to pay back the $427.
C. Use your debit card or credit card online or by phone.
D. Set up a direct payment from your bank account.
Tell the IRS to take out more taxes next year to pay back the $427.
Which of the following statements about the W-2 form is TRUE?
A. A W-2 lists all the money you earned in cash over the last year.
B. The total wages you earned from ALL jobs you worked in the previous year
appear on ONE W-2 form.
C. You need a separate W-2 form from EACH of your employers in order to file
your taxes.
D. The W-2 includes information about the interest you earned from your
investments.
You need a separate W-2 form from EACH of your employers in order to file
your taxes.
When you complete your 1040 form, if you overpaid your taxes and the government
owes you money, that is called a __________.
A. withholding
B. direct deposit
C. deduction
D. refund
Refund
Akshay worked at a cafe while he was a college senior in Boston, Massachusetts. After
graduating in June, he moved back to his home in California and started a full-time job
in September. Which of the following statements is true?
A. Akshay will need to file only a federal tax return.
B. Akshay will need to file a federal tax return and a state tax return for
Massachusetts.
C. Akshay will need to file a federal tax return and a state tax return for both
Massachusetts and California.
D. Akshay will need to file a federal tax return this year and file state returns the
following year.
Akshay will need to file a federal tax return and a state tax return for both
Massachusetts and California.
Jessica is 16 years old and earned $1,100 through her photography side gig. Her
parents can claim her as a dependent on their tax return. All of the following
statements are true EXCEPT:
A. Jessica is required to file an income tax return.
B. Jessica should expect to receive a W-2 in January.
C. Jessica is required to pay a 15.3% self-employment tax.
D. Jessica can file her own tax return even though her parents are claiming her
as a dependent
Jessica should expect to receive a W-2 in January.
Out of the following group, who does NOT have to file a tax return?
A. Janet, who earned $28,200 but was paid entirely in cash.
B. Max, whose total income from three separate part-time jobs was $9,500.
C. Isaiah, who owns his own business and generated an income of $7,000.
D. Dani, who is a cafe barista and earned $13,000 in wages and $250 in tips
. Max, whose total income from three separate part-time jobs was $9,500.
Marquis started a fast-food job during his senior year of high school. He lives with his
parents and they will claim him as a dependent on their taxes this year. He earned
$2,000 during the year. Based on how he completed his W-4, his employer withheld
$200 in federal income taxes from his paychecks. What will happen if Marquis doesn’t
file taxes in April?
A. The IRS will refund his $200 directly to him.
B. The IRS will refund his $200 to his parents.
C. The IRS will fine Marquis $75 or more for not filing taxes.
D. Nothing will happen, but Marquis will miss out on his potential refund.
Nothing will happen, but Marquis will miss out on his potential refund.
The United States government agency responsible for the collection and enforcement
of federal taxes is known as the __________.
A. Federal Reserve System (Fed)
B. Securities and Exchange Commission (SEC)
C. U.S. Internal Revenue Service (IRS)
D. Consumer Financial Protection Bureau (CFPB)
. U.S. Internal Revenue Service (IRS)
Which of the following best explains how income taxes reduce your income?
A. They are subtracted from net income.
B. They are subtracted from gross income.
C. You must save money to pay for them.
B. They are subtracted from gross income.
When do you start paying taxes?
A. When you turn 18.
B. When you make more than the minimum income requirement.
C. When you get a full-time job (part-time does not count).
D. When you are notified by the IRS that you are required to pay federal income
taxes.
When you make more than the minimum income requirement.
your friend Laila is talking to you about the benefits of tax filing software. Which of
the following is true?
A. Filing your taxes using the software is always free of charge.
B. You can avoid the costs of having to pay a professional, though you may have
to pay for the software and/or e-filing online.
C. You are guaranteed a higher refund than if you were to use a paper form or
hire a professional.
D. You are 50% less likely to make a mistake when e-filing your taxes than if you
were to file them using paper forms.
You can avoid the costs of having to pay a professional, though you may have
to pay for the software and/or e-filing online.
Which of the following describes what a “dependent” is for tax purposes?
A. Someone under the age of 19 whom you financially support.
B. Someone who is temporarily disabled.
C. Someone who financially supports you.
D. Someone who is a full-time student under the age of 30.
A. Someone under the age of 19 whom you financially support.
When you prepare governmental income tax forms for submission, why should you use
tax deductions to reduce your taxable income?
A. You can qualify for a higher tax rate.
B. You won’t have to pay any taxes.
C. You can increase your gross income.
D. You can decrease your taxable income.
D. You can decrease your taxable income.
A person earned a salary of $70,000 last year. Additionally, he had $1,000 in interest
income and $2,000 in dividend income. His total income for the year is __________.
A. $70,000
B. $71,000
C. $72,000
D. $73,000
D. $73,000
A flat tax rate where the tax rate is the same regardless of income is called a
__________.
A. Progressive tax
B. Proportional tax
C. Regressive tax
D. Tax bracket
B. Proportional tax
A tax that taxes a larger share of income as income grows is called a __________.
A. Progressive tax
B. Proportional tax
C. Regressive tax
D. Tax bracket
A. Progressive tax
