Understanding Paychecks

What is gross income?

• Income after taxes

• Income before taxes

• Income that is tax free

• Income tax for the state

What is Net income?

• Income before taxes
• Income after taxes
• Income that is not taxed
• State taxes

What does IRS stand for?

• Income ready standards
• Income research service 
• Internet resource service 
• Internal revenue service

When should you fill out a W-4?

• When you quit a job
• When you have 401K benefits 
• When you start a new job
• Whenever you feel like it

Taxes are deducted from all employees paychecks

• true
• false

Roads, police, schools, governmental agencies, fire and emergency services are all funded by taxes

• true
• false

How much income did John earn during his first pay period?

• $168.00
• $43.09
• $25.20
• $2.44

According to John's paystub, how much federal income tax was withheld from John's check?

• $10.42
• $124.91
• $2.44
• $25.20

Why do you need to fill out a W-4?

• It lets your employer determine what kind of health insurance you need.
• It helps your employer determine what percentage of your income should be deducted for taxes.

Deductions are also known as.....?

• withdrawals

• Withholdings

• Subtractions

• None of the above