4.29.2010

about taxes

Tax money is used to pay for…


• Roads.

• Schools.

• Disability.

• Bailouts.

Tax terms

• Withholding – money an employer deducts from a pay check to pay taxes,

• Exempt – do not have to pay taxes.

• Gross pay – earnings before taxes or any other deductions taken out.

• Net pay – take home pay-money left over after taxes are taken out.

• W4 – the form filled out when you are first hired claiming your exemptions.

• W2 – form that employers are required to give each employee by January 31st each year which tells you how much money was taking out of income for taxes, etc.

• 1040 Tax Return Form – Form filled out yearly to report taxes and may result in a refund or payment to IRS.

• Dependent – person who relies on another for at least ½ of his or her support.

- Support includes…

o Food.

o Shelter.

o Clothing.

o Dental care.

o Education.

• You can be a dependent if you…

- Are under 19 years old.

- Make less than a certain amount each year.

- Full time college (taking 12 credit hours) student between the ages of 19 & 24.

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