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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