Chapter 13 Chapter Test Study

Which is NOT a type of payroll deduction?

• 401(k)

• Tax credit

• Social Security tax

• Federal income tax

Which tax form is used to determine the amount of income tax deducted from your paycheck?

• Form W-2

• Form W-4

• Form I-9

• Form 1040

Why is it important to determine how much of your income should be withheld?

• To match your correct tax liability

• To reduce the amount of taxes you pay

• To verify that you are eligible for employment

• To ensure your taxes remain the same throughout your career

Which element is NOT included on Form 1040?

• Whether you are due a refund

• How your gross pay is calculated

• Your total wages, salaries, and tips

• The amount of taxes withheld from your pay

What is a way to reduce an individual’s tax liability?

• Claim a tax credit

• Consult tax tables

• Complete Form 1040

• Adjust your withholdings

Define the term: Federal income tax.

• The amount of federal tax on earnings imposed by the IRS based on tax tables.

• A state tax on property ownership.

• A local tax on sales transactions.

• A tax on imported goods.

Define the term: Form W-2.

• A form that reports an employee’s annual wages and the amount of taxes withheld from paychecks.

• A form used to apply for a job.

• A form that reports business expenses.

• A form used to file personal income tax returns.

Define the term: Gross income.

• All of the income an individual receives in a year.

• The total income after taxes and deductions.

• Income from investments only.

• The net profit from a business.

Define the term: Pay stub.

• An attachment to your paycheck that shows the amount earned and details the payroll deductions.

• A summary of your annual tax returns.

• A document that outlines your job responsibilities.

• A receipt for a purchase made with a credit card.

Tags

CCSS.RI.8.7

CCSS.RI.9-10.7

CCSS.RL.7.7

CCSS.RL.8.7

CCSS.RL.9-10.7

Define the term: Tax liability.

• The amount of tax an individual owes.

• A type of tax refund.

• An investment strategy.

• A government grant.