Payroll and Tax Quiz

What is the Federal Insurance Contributions Act (FICA) designed to fund?

• A voluntary paycheck withholding for retirement investment funds

• A document detailing an employee's earnings and withholdings

• Federal and state taxes for social services

• Social Security and Medicare programs

What is Earned Income?

• Profit from the sale of an asset

• A child or adult that you support financially

• Any income (wages/salary) that is generated by working

• The portion of an employee's wages not included in their paycheck

What is a Paycheck Stub?

• A federal law requiring employers to withhold taxes from wages

• A document attached to every paycheck that details your earnings and the amount withheld for taxes, health insurance, retirement funds, etc.

• A category that defines the type of tax return an individual will use

• The standard IRS form for filing annual income tax returns

What does the term "Withholding" refer to in the context of payroll?

• The process of electing officials to approve government spending

• The portion of an employee's wages that is not included in their paycheck because it goes directly to federal, state and local taxes

• A voluntary contribution to a retirement investment fund

• The profit from the sale of an asset, such as a stock or a bond

Which program provides healthcare assistance to low income Americans?

• Social Security program

• Medicare program

• Medicaid program

• Payroll Tax

What is the purpose of a 401(k) contribution?

• To fund discretionary spending by the federal government

• To provide monthly benefits to Americans, including retirees

• To put money into a retirement investment fund

• To support financially a child or adult

What determines an individual's Filing Status for tax returns?

• The amount withheld for taxes, health insurance, retirement funds, etc.

• The type of tax return an individual will use, primarily based on marital status

• The size of the paycheck received by an individual

• The amount of earned income generated by working

What is a 1040 form used for?

• To calculate capital gains from the sale of assets

• To determine the amount of Social Security benefits one is eligible for

• To file annual income tax returns

• To document the earnings and withholdings on an employee's paycheck

How is Capital Gain defined?

• The amount of money withheld from a paycheck for taxes and other deductions

• The profit from the sale of an asset, calculated by subtracting the purchase price from the sale price

• The total amount of income earned from working

• The funds allocated to support a dependent

What is the current amount for Standard Deduction?

• $12,000

• $13,850

• $14,000

• $15,000