Wages and Taxes

Front

Which statement BEST describes marginal tax rates? Options: Your income may fall into more than one tax bracket, so more than one tax rate can apply (e.g. fill up the first pocket and then move to the next pocket), Your income is equally split among the tax brackets (e.g. divide your income by # of brackets and apply the rates of each tax bracket), Your income is always taxed at the lowest rate of that tax year (e.g. all of your income is placed and taxed in the first pocket), Your income is taxed at the highest rate that applies to your income amount (e.g. all of your income is taxed in the highest pocket)

Back

Your income may fall into more than one tax bracket, so more than one tax rate can apply (e.g. fill up the first pocket and then move to the next pocket)

Front

A tax deduction...

Back

LOWERS a person's tax liability by LOWERING their taxable income

Front

These taxes are calculated at 6.2% and 1.45% of gross earnings

Back

FICA Social Security and FICA Medicare

Front

FICA - Social Security Tax is considered....

Back

Regressive - After the first $168,600 of annual earnings, wage earners are not subject to this tax

Front

Federal income tax is considered....

Back

Progressive - as taxable income increases, federal income tax also increases

Front

Why is it important to review your paystub every pay period?

Back

All of the answers are correct

Front

A paycheck is...

Back

A check or direct deposit for salary or wages paid to an employee

Front

Which statement below accurately describes the calculation of gross wages for an hourly employee? Options: Annual salary divided by number of pay periods, Number of hours worked times hourly pay rate, Net wages times FICA withholding, Gross income minus taxes and deductions

Back

Number of hours worked times hourly pay rate

Front

What is the difference between gross pay and net pay?

Back

Gross pay is before taxes and deductions are subtracted; Net pay is your take-home pay.

Front

All of the following options are benefits we receive as a result of government spending EXCEPT… National Defense, Public Education, National Parks Maintenance, Personal wardrobe

Back

Personal wardrobe