Financial Algebra Vocabulary #2 (Taxes, Living, & Investing)

What are Tax-Deferred Contributions?

• Contributions that are made after paying taxes.

• Contributions that allow you to defer paying taxes until a later date.

• Contributions that are tax-free.

• Contributions that are deducted after retirement.

What is a Flexible Spending Account (FSA)?

• An account where you can set aside pre-tax dollars for healthcare expenses.

• An account used for non-taxable retirement contributions.

• An account for saving on luxury purchases.

• An account where unused funds roll over each year.

What is Sales Tax?

• A tax paid by sellers on their gross sales.

• A tax on income earned from sales.

• A tax on corporate earnings.

• A tax levied on goods and services purchased by consumers.

What is the Internal Revenue Service (IRS)?

• An agency that issues driver's licenses.

• A federal agency responsible for collecting taxes and enforcing tax laws in the United States.

• A private tax consultancy firm.

• A state-level tax agency.

What is a Tax?

• A mandatory financial charge imposed by a government on individuals or entities.

• A fee for using public facilities.

• A voluntary contribution to the government.

• A donation to public services.

What does Filing Status determine?

• Whether you need to file taxes online or on paper.

• The type of audit you may face.

• The tax rate and standard deduction you qualify for based on your marital and family situation.

• The amount of sales tax you owe.

What is a Tax Exemption?

• A deduction from taxable income.

• A tax credit for qualifying expenses.

• An amount you can subtract from your taxable income to reduce your tax liability.

• A fee paid to avoid certain taxes.

What is Income Tax?

• A tax on the value of personal property.

• A tax imposed on an individual’s or business’s earnings.

• A tax levied on goods and services sold.

• A tax on capital gains.

What does Form 1099 report?

• Wages and salary paid to employees.

• Property tax assessments.

• Tax deductions and credits.

• Various types of income other than wages, salaries, and tips.

What is the role of the Ohio Department of Taxation?

• Managing federal tax filings for Ohio residents.

• Collecting and administering state taxes in Ohio.

• Overseeing international trade taxes.

• Regulating financial markets in Ohio.