2.4 Online class.pdf - Study Guide a What is individual income tax percentage of an individual's earnings that must be paid to the government b Name two

2.4 Online class.pdf - Study Guide a What is individual...

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Study Guide a) What is individual income tax? percentage of an individual's earnings that must be paid to the government b) Name two things that affect how much income tax you pay. Adjustments, deductions, exemptions a) What is total taxable income? individual's income after adjustments, deductions, and exemptions are considered. The portion of total income on which taxes are based. b) Is total taxable income the same as total income? Why or why not? No, total income is higher then total taxable income because deductions and exemptions have to be taken off. a) What is a progressive tax system? type of taxation in which people and businesses with higher incomes have higher tax rates. b) What are pay-as-you-go taxes ? the requirement that your employer deduct money from each paycheck and send it to the Treasury
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a) What is a W-4 form? IRS form that all employees must fill out when starting a new job. It is used by employers to calculate the amount of federal and state income tax to withhold from employees' paychecks. b) What is a W-2 form? an official document from your employer that tells you how much you made in gross and net income that year. It also includes any deductions that were made from your regular paychecks.
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