Chapter 6. Paying Taxes Pearson Education, Inc. All rights reserved

Size: px
Start display at page:

Download "Chapter 6. Paying Taxes Pearson Education, Inc. All rights reserved"

Transcription

1 Chapter 6 Paying Taxes 2010 Pearson Education, Inc. All rights reserved

2 Learning Objectives Describe the basic principles of taxation and the major categories of taxes. Explain payroll taxes Describe the purpose and process of filing tax returns Explain how taxes affect your financial plan 2010 Pearson Education, Inc. All rights reserved 0-2

3 Tax Basics Tax is money collected by a government from its citizens for the purpose of operating the government Gross pay is the total amount of money you earn Take-home pay is the amount of money you get to keep and use Net Pay is the amount of money you take home 2010 Pearson Education, Inc. All rights reserved 0-3

4 Tax Basics Everyone pays taxes Taxes pay the cost of government The government levies taxes on different things States can have different taxes too There are all different types of taxes, such as: Sales Taxes Real Estate Taxes Payroll Taxes 2010 Pearson Education, Inc. All rights reserved 0-4

5 Math for Personal Finance Ryan s take-home or net pay was $ and his gross pay was $ Assume the FICA withholdings are How much did Ryan pay in FICA from this check? 2010 Pearson Education, Inc. All rights reserved 0-5

6 Math for Personal Finance Solution: Solution: Ryan paid 7.65 percent of the $60 or $12.24 in FICA from this check Pearson Education, Inc. All rights reserved 0-6

7 Sales Tax Sales tax is tax on purchases at a store Some of the price we pay for an item is a tax The merchant collects this money and sends it to the government The federal government does not impose a sales tax Many state governments do impose a sales tax 2010 Pearson Education, Inc. All rights reserved 0-7

8 Real Estate Tax Governments calculate real estate taxes based on the value of the property The government sends the property owner a bill for this tax These taxes are primarily used to fund local schools They also vary significantly from state to state and county to county Pearson Education, Inc. All rights reserved 0-8

9 Payroll Taxes Payroll Taxes are taxes on your paycheck Many people pay taxes every time they get paid These taxes can include federal and state income taxes and social security (or FICA) withholdings. People who are self employed do not have taxes withheld from their earnings. See figure 6.1 for an example of a pay stub 2010 Pearson Education, Inc. All rights reserved 0-9

10 Figure Pearson Education, Inc. All rights reserved 0-10

11 The Internal Revenue Service Internal revenue service (IRS) is the government body that carries out the federal tax system The IRS is a branch of the United States Treasury Department They enforce the tax laws and collect taxes Each year in which you earn an income over a certain amount, you need to file a federal tax return with the IRS 2010 Pearson Education, Inc. All rights reserved 0-11

12 The Internal Revenue Service Tax returns report to the IRS all the information relative to your income taxes A tax return consists of a form called 1040 or 1040EZ (see Figure 6.2 a &b) On this form you need to include how much income you earned and how much you paid to the IRS You will either receive a refund or pay the difference to the government if you owe money 2010 Pearson Education, Inc. All rights reserved 0-12

13 Figure 6.2a 2010 Pearson Education, Inc. All rights reserved 0-13

14 Figure 6.2b 2010 Pearson Education, Inc. All rights reserved 0-14

15 The Internal Revenue Service Taxes are figured based on your earnings from January to December When the year is over, you have until April 15 th to file your return Many careers involve helping people take advantage of tax laws to pay the lowest possible tax Attorneys and accountants make good incomes by helping people with tax issues 2010 Pearson Education, Inc. All rights reserved 0-15

16 Check Your Financial IQ What is the major purpose of taxes? 2010 Pearson Education, Inc. All rights reserved 0-16

17 Check Your Financial IQ Taxes pay the cost of government 2010 Pearson Education, Inc. All rights reserved 0-17

18 Understanding Payroll Taxes Personal Income Taxes are federal income taxes and state income taxes (the states that have them) Social Security provides payments to eligible retirees and disabled people Medicare provides health care coverage to mostly older Americans and some younger disabled people Payroll taxes include: Social Security and Medicare taxes Personal income taxes (state and federal) 2010 Pearson Education, Inc. All rights reserved 0-18

19 Social Security and Medicare For most Americans, earned income is subject to FICA taxes FICA taxes are withheld from your paychecks and sent to the government These withholdings fund Social Security and Medicare For both Social Security and Medicare, your employer matches your contributions and sends the total amount to the government 2010 Pearson Education, Inc. All rights reserved 0-19

20 Social Security and Medicare Your portion of the Social security tax is equal to 6.20 percent of your salary up to a specific income level This amount is linked to inflation and increases slightly every year There is no cap on the amount of earnings subject to the Medicare tax 2010 Pearson Education, Inc. All rights reserved 0-20

21 Math for Personal Finance Brogan s grandfather made $112,000 in 2007, and the Social Security cap in 2007 was $97,5000. How much Social Security was withheld from his pay and how much Medicare was withheld from his pay? 2010 Pearson Education, Inc. All rights reserved 0-21

22 Math for Personal Finance Solution: Brogran s grandfather had 6.2% withheld from his pay for the first $97,500 he made during 2007 for a total of $6,045 or (.062 x $97,500). However, Medicare was withheld on the entire amount so Medicare withholdings were $112,000 x.0145 = $1, Pearson Education, Inc. All rights reserved 0-22

23 Personal Income Taxes Personal income taxes is the income reported on your tax return Many people use a tax professional or tax preparation software for returns. These programs guide you through preparing your tax returns and include all the necessary forms Refer to Figure 6.3 for the IRS table of individual tax rates 2010 Pearson Education, Inc. All rights reserved 0-23

24 Figure Pearson Education, Inc. All rights reserved 0-24

25 Other Income Taxes Many people pay a state income tax, depending on where they live Some cities also collect income taxes Take a look at figure 6.4 for a listing of states with the highest and lowest tax rates 2010 Pearson Education, Inc. All rights reserved 0-25

26 Figure Pearson Education, Inc. All rights reserved 0-26

27 Check Your Financial IQ What are the payroll taxes? 2010 Pearson Education, Inc. All rights reserved 0-27

28 Check Your Financial IQ Federal and state income taxes, Social Security, and Medicare are payroll taxes 2010 Pearson Education, Inc. All rights reserved 0-28

29 Filing Taxes A tax return form allows you to record several different categories of information, including: Filing Status Exemptions Gross Income Adjusted gross income Tax and credits 2010 Pearson Education, Inc. All rights reserved 0-29

30 Filing Status Taxpayers need to specify a filing status when they submit their income tax return They must choose one of the following options: Single Married filing jointly Married filing separately Head of household Qualifying widow(er) with dependent child 2010 Pearson Education, Inc. All rights reserved 0-30

31 Filing Status Tax rules and rates differ depending on which status you choose Until the age of 18, most of you will be considered dependents by the IRS 2010 Pearson Education, Inc. All rights reserved 0-31

32 Gross Income or Total Income Gross income is the total income consisting of the total amount of a person s income from (almost) any source The first step in calculating the federal tax you owe is to determine your gross income Your employer will send you a W-2 form that details how much money you made See Figure 6.5 for a sample W-2 form 2010 Pearson Education, Inc. All rights reserved 0-32

33 Figure Pearson Education, Inc. All rights reserved 0-33

34 Gross Income or Total Income Capital gains occur when you sell an asset for more than what you paid for it Other forms of income include interest income, dividend income, and capital gains Gross income also includes income from tips, rental properties, and business income. Some types of income are not included in gross income and therefore are not taxes, such as: Insurance reimbursements Child support payments Veteran s welfare benefits 2010 Pearson Education, Inc. All rights reserved 0-34

35 Adjusted Gross Income Adjusted gross income is figured by taking the total income and subtracting certain allowable amounts The next step in filing a tax return is to figure your adjusted gross income, or AGI. The allowable amounts include : contributions to certain retirement accounts alimony payments interest paid on student loans 2010 Pearson Education, Inc. All rights reserved 0-35

36 Math for Personal Finance Last year Colt s salary was $32,000 but he also received $1,200 in dividend income and lost $400 on the sale of one stock and gained $650 on the sale of another stock. What was Colt s gross income? 2010 Pearson Education, Inc. All rights reserved 0-36

37 Math for Personal Finance Solution: Colt s gross income was $32,000 + $1,200 - $400 +$650 = $33, Pearson Education, Inc. All rights reserved 0-37

38 Deductions and Exemptions Standard deduction is a fixed amount all people are allowed to deduct from their AGI to reduce their tax liability Itemized deductions are specific expenses that, under tax law, can be deducted from income to reduce the amount of income subject to income tax You may be able to claim various deductions and exemptions that will reduce the amount of your AGI that is subject to your income taxes. These deductions include: Standard deduction Itemized deduction 2010 Pearson Education, Inc. All rights reserved 0-38

39 Deductions and Exemptions Congress has approved certain items as tax deductible in order to encourage certain behaviors For example, Congress encourages home ownership Homeowners can deduct the interest paid on a mortgage loan and the real estate taxes they pay 2010 Pearson Education, Inc. All rights reserved 0-39

40 Refund or Payment Accurate completion of your tax return will show you if you need to pay additional income taxes or if you will receive a refund In most cases, you will not receive a refund unless you pay taxes during the year 2010 Pearson Education, Inc. All rights reserved 0-40

41 Check Your Financial IQ When does a person file his or her taxes? 2010 Pearson Education, Inc. All rights reserved 0-41

42 Check Your Financial IQ A person fills out a tax return by April 15 of each year 2010 Pearson Education, Inc. All rights reserved 0-42

43 Taxes and Your Financial Plan People want to lower their tax liability to the lowest possible level for their income They will keep more of their own money rather than paying it to the government in taxes Tax planning influences both your short-term and long-term future Consider the tax implications of your financial life at all stages 2010 Pearson Education, Inc. All rights reserved 0-43

44 Check Your Financial IQ Why are taxes an important part of your financial plan? 2010 Pearson Education, Inc. All rights reserved 0-44

45 Check Your Financial IQ You must consider the tax consequences of all your financial decisions because the tax impact may make one course of action better than another 2010 Pearson Education, Inc. All rights reserved 0-45

46 Summary Taxes are monies the government collects from citizens for the purpose of operation the government The government collects taxes in a variety of ways and forms: Sales taxes Real estate taxes Payroll taxes The IRS is the governmental body that carries out the federal tax system 2010 Pearson Education, Inc. All rights reserved 0-46

47 Summary Payroll taxes include personal income taxes (state and federal) and Social Security and Medicare taxes Social Security and Medicare taxes are also known as FICA Filing taxes involves reporting your earnings for the year on a tax return. This is sent to the IRS and to any appropriate state or local tax collection agency 2010 Pearson Education, Inc. All rights reserved 0-47

48 Summary Tax planning is another important step in your financial plan Taking full advantage of the ways to reduce your taxable income takes planning 2010 Pearson Education, Inc. All rights reserved 0-48

49 Key Terms and Vocabulary Adjusted gross income Capital gain Gross income Gross pay Internal Revenue Service (IRS) Itemized deduction Medicare Net pay Payroll tax Personal income tax Sales tax Social security Standard deduction Take-home pay Tax Tax return 2010 Pearson Education, Inc. All rights reserved 0-49

50 Websites Pearson Education, Inc. All rights reserved 0-50

Introduction. Income Tax: percentage of your income collected by the government to fund its services and programs

Introduction. Income Tax: percentage of your income collected by the government to fund its services and programs Introduction Income Tax: percentage of your income collected by the government to fund its services and programs Tax revenue pays for national defense, fire and police protection, road construction, schools,

More information

14-1: How Taxes Work NOTES

14-1: How Taxes Work NOTES 14-1: How Taxes Work NOTES Learning Target 1. I will demonstrate my understanding of the different types of taxes and what tax revenue is used for. Government Revenue Tax: a mandatory payment to a local,

More information

Chapter. Federal Income Tax. 7.1 Our Tax System 7.2 Filing Tax Returns South-Western, Cengage Learning

Chapter. Federal Income Tax. 7.1 Our Tax System 7.2 Filing Tax Returns South-Western, Cengage Learning Chapter 7 Federal Income Tax 7.1 Our Tax System 7.2 Filing Tax Returns 2010 South-Western, Cengage Learning Lesson 7.1 Our Tax System GOALS Why do we pay taxes? What are the different types of taxes? Describe

More information

Understanding Taxes. and understanding your paycheck!

Understanding Taxes. and understanding your paycheck! Understanding Taxes and understanding your paycheck! Summarize the purpose of paying taxes. Recognize the parts of a paystub. Differentiate between net and gross income. Explain what W-2 and W-4 forms

More information

Federal Individual Income Tax Terms: An Explanation Mark P. Keightley Specialist in Economics. May 31, 2017

Federal Individual Income Tax Terms: An Explanation Mark P. Keightley Specialist in Economics. May 31, 2017 Federal Individual Income Tax Terms: An Explanation Mark P. Keightley Specialist in Economics May 31, 2017 Congressional Research Service 7-5700 www.crs.gov RL30110 Summary Described in this report are

More information

Sponsored by University Student Financial Services PERSONAL TAXES. Jodi R. Kessler, LLM Tax Manager Harvard University

Sponsored by University Student Financial Services PERSONAL TAXES. Jodi R. Kessler, LLM Tax Manager Harvard University Sponsored by University Student Financial Services PERSONAL TAXES Jodi R. Kessler, LLM Tax Manager Harvard University 1 DISCLAIMER Federal income tax; states may differ Information is specific to US citizens

More information

Business and Personal Finance Unit 4 Chapter Glencoe/McGraw-Hill

Business and Personal Finance Unit 4 Chapter Glencoe/McGraw-Hill 0 Chapter 12 Planning Your Tax Strategy What You ll Learn Section 12.1 Discuss the importance of tax planning. Identify your taxable income. Explain deductions and tax credits. Explain the W-4 form. Section

More information

Paying Your Income Taxes. Advanced Level

Paying Your Income Taxes. Advanced Level Paying Your Income Taxes Advanced Level What are taxes? A sum of money demanded by a government for support of itself and specific programs and services; paid by taxpayers Take Charge Today February 2017

More information

Personal Finance G

Personal Finance G Personal Finance 1.13.1.G Almost 31% of an individual s paycheck is deducted Taxes are the largest expense most individuals will have Therefore, it is important to understand the systematic deductions

More information

2) Knowledge of individual income taxes is crucial to sound financial planning. Answer: TRUE Diff: 1 Question Status: Previous edition

2) Knowledge of individual income taxes is crucial to sound financial planning. Answer: TRUE Diff: 1 Question Status: Previous edition Personal Finance, 6e (Madura) Chapter 4 Using Tax Concepts for Planning 4.1 Background on Taxes 1) Knowledge of tax laws can help you conserve your income. 2) Knowledge of individual income taxes is crucial

More information

Table of contents. 2 Federal income tax rates 12 Required minimum distributions. 4 Child credits 13 Roth IRAs

Table of contents. 2 Federal income tax rates 12 Required minimum distributions. 4 Child credits 13 Roth IRAs 2017 tax guide Table of contents 2 Federal income tax rates 12 Required minimum distributions 4 Child credits 13 Roth IRAs 5 Taxes: estates, gifts, Social Security 15 SEPs, Keoghs 6 Rules on retirement

More information

Chapter 14 Section 2: Federal Taxes

Chapter 14 Section 2: Federal Taxes Chapter 14 Section 2: Federal Taxes Objectives: o Objectives: Describe the process of paying individual income taxes o Identify: the basic characteristics of corporate income taxes. o Explain: the purpose

More information

Tax Determination, Payments, and Reporting Procedures

Tax Determination, Payments, and Reporting Procedures CCH Essentials of Federal Income Taxation Tax Determination, Payments, and Reporting Procedures 2002, CCH INCORPORATED 4025 West Peterson Ave. Chicago, IL 60646-6085 http://tax.cchgroup.com Taxpayer Filing

More information

Don t fill in cents. Round off cents to the nearest dollar. For example, $99.49 becomes $99.00, and $99.50 becomes $

Don t fill in cents. Round off cents to the nearest dollar. For example, $99.49 becomes $99.00, and $99.50 becomes $ Page 1 of 3, 150-206-643 (Rev. 08-18) Oregon Department of Revenue 04131801010000 Instructions: Read Oregon Income Tax Withholding Information prior to completing this worksheet. Complete Part A to determine

More information

The IRS Will Figure Your Tax

The IRS Will Figure Your Tax Department of the Treasury Internal Revenue Service Publication 967 Cat. No. 22402M The IRS Will Figure Your Tax Introduction You can have the IRS figure your tax on Form 1040EZ, Form 1040A, or Form 1040

More information

Preparing 2018 Individual Income Tax Returns

Preparing 2018 Individual Income Tax Returns Preparing 2018 Individual Income Tax Returns Published and Distributed by The CPE Store, Inc. www.cpestore.com Module 1 Chapters 1-4 Chapter 1 Filing Information... 1 Learning Objectives... 1 Introduction...

More information

CHAPTER 12 PREPARING PAYROLL RECORDS

CHAPTER 12 PREPARING PAYROLL RECORDS I. Paying Employees CHAPTER 12 PREPARING PAYROLL RECORDS A. Hobby Shack employs several people to work in the business, and they record the time they work each day. B. Periodically they pay its employees

More information

Chapter 12. Objectives:

Chapter 12. Objectives: Chapter 12 Objectives: 1. Define accounting terms related to payroll records 2. Identify accounting practices related to payroll records 3. Complete a payroll time card 4. Calculate payroll taxes 5. Complete

More information

7.4: FORMS 1040 EZ AND 1040A OBJECTIVES

7.4: FORMS 1040 EZ AND 1040A OBJECTIVES Section 7.4: FORMS 1040 EZ AND 1040A OBJECTIVES Complete form 1040EZ. Complete form 1040A. Key Terms Form 1040EZ Form 1040A Form 1040 dependent exemption itemize standard deduction Chapter 7: Income Taxes

More information

Preparing 2016 Individual Income Tax Returns

Preparing 2016 Individual Income Tax Returns Preparing 2016 Individual Income Tax Returns Published and Distributed by The CPE Store, Inc. www.cpestore.com Module 1 Chapters 1-4 Chapter 1 Filing Information... 1 Learning Objectives... 1 Introduction...

More information

Earned Income Table. Earned Income

Earned Income Table. Earned Income Earned Income Table Includes Taxable wages, salaries, and tips Union strike benefits Taxable long-term disability benefits received prior to minimum retirement age Net earnings from self-employment Gross

More information

Federal Income Taxes. Today s Approach. Your Tax Knowledge. Process. Process Continued. Filing Requirements. Fall 2014 VITA Training

Federal Income Taxes. Today s Approach. Your Tax Knowledge. Process. Process Continued. Filing Requirements. Fall 2014 VITA Training Federal Income Taxes Fall 2014 VITA Training Dr. Cathy Bowen Dr. Barbara Yener Today s Approach Use Form 1040 and common tax forms to discuss key areas of completing a tax return for VITA taxpayers. Not

More information

Accounting 1. Lesson Plan. Topic: Preparing Payroll Records Unit: 3 Chapter 14

Accounting 1. Lesson Plan. Topic: Preparing Payroll Records Unit: 3 Chapter 14 Accounting 1 Lesson Plan Name: Terry Wilhelmi Day/Date: Topic: Preparing Payroll Records Unit: 3 Chapter 14 I. Objective(s): By the end of today s lesson, the student will be able to: define accounting

More information

WHAT S NEW IN TAXES FOR 2016 by Robert D Flach, the internet s Wandering Tax Pro

WHAT S NEW IN TAXES FOR 2016 by Robert D Flach, the internet s Wandering Tax Pro WHAT S NEW IN TAXES FOR 2016 by Robert D Flach, the internet s Wandering Tax Pro Here is the inflation-adjusted and COLA numbers for tax year 2016. Many items have not changed from 2015 - THE STANDARD

More information

A tax is:,, and taxes account for. For many workers, are their single annual. expense, even more than, shelter, transportation,

A tax is:,, and taxes account for. For many workers, are their single annual. expense, even more than, shelter, transportation, Taxes Guided Notes: What are Taxes: A tax is:.,, and taxes account for more than 35% of the average families expenses. For many workers, are their single annual expense, even more than, shelter, transportation,,

More information

Nonresident Alien State of Hawaii Tax Workshop

Nonresident Alien State of Hawaii Tax Workshop Nonresident Alien State of Hawaii Tax Workshop University of Hawaii J-1 State of Hawaii Tax Workshop March 23, 2017 Major Differences: Federal & Hawaii Federal Tax treaties Green card test Substantial

More information

Chapter 3. Objective 1 Identify the Major Taxes Paid by People in Our Society Planning Your Tax Strategy. Chapter Objectives

Chapter 3. Objective 1 Identify the Major Taxes Paid by People in Our Society Planning Your Tax Strategy. Chapter Objectives Chapter 3 Taxes in Your Financial Plan McGraw-Hill/Irwin Copyright 2010 by The McGraw-Hill Companies, Inc. All rights reserved. Taxes in Your Financial Plan Chapter Objectives 1. Identify the major taxes

More information

Chapter 7. Federal Income Tax. "In this world nothing is certain but death and taxes. - Benjamin Franklin

Chapter 7. Federal Income Tax. In this world nothing is certain but death and taxes. - Benjamin Franklin Chapter 7 Federal Income Tax "In this world nothing is certain but death and taxes. - Benjamin Franklin Lesson 7.1 Our Tax System GOALS Discuss the purpose of taxes, different types of taxes, and the history

More information

LEARNING TASKS These tasks match pages in Student Guide 3.

LEARNING TASKS These tasks match pages in Student Guide 3. STUDENT LEARNING PLAN Lesson 3-3: Pay and Taxes OVERVIEW If your job pays $8 an hour and you work 20 hours, your paycheck will be $160, right? The reality is, what you earn is not the same as what you

More information

Social Security: With You through Life s Journey. Produced at U.S. taxpayer expense

Social Security: With You through Life s Journey. Produced at U.S. taxpayer expense Social Security: With You through Life s Journey Produced at U.S. taxpayer expense Topics - Working, Paying in - Taking Your Benefits? - Working & Receiving - Family Benefits Payroll (FICA) Tax 6.2 % Social

More information

2012 Filing Season Opens with Tax Questions and Answers

2012 Filing Season Opens with Tax Questions and Answers Media Relations Office Georgia, South Carolina, Mississippi Media Contact: 404.338.7886 For Release: ATL. 2013-15 mark.green@irs.gov Public Contact: 800.829.1040 2012 Filing Season Opens with Tax Questions

More information

Tax Withholding and Estimated Tax

Tax Withholding and Estimated Tax This publication was cited in a footnote at the Bradford Tax Institute. ClLICK HERE to go to the home page. Department of the Treasury Internal Revenue Service Publication 505 Cat. No. 15008E Tax Withholding

More information

During fiscal year 2004, the federal government

During fiscal year 2004, the federal government Preview Objectives After studying this section you will be able to: 1. Describe the process of paying individual income. 2. Explain the basic characteristics of corporate income. 3. Understand the purpose

More information

Paying Your Income Taxes

Paying Your Income Taxes Paying Your Income Taxes Advanced Level Taxes they re a part of everyday life. Perhaps you ve overheard a significant adult in your life talk about taxes, sometimes accompanied by a groan. For many people,

More information

Tax. and Estimated Tax. Contents. For use in. Introduction. Publication

Tax. and Estimated Tax. Contents. For use in. Introduction. Publication Publication 505 Contents Tax Withholding and Estimated Tax Introduction 1 Cat No 15008E Department of the Treasury Internal Revenue Service For use in 2016 What's New for 2016 2 Reminders 2 Chapter 1 Tax

More information

Econ Ch. 9 Practice Test II

Econ Ch. 9 Practice Test II Econ Ch. 9 Practice Test II Multiple Choice Identify the choice that best completes the statement or answers the question. 1. The incidence of a tax can more effectively be shifted from the supplier to

More information

Overview of the Tax Cuts and Jobs Act

Overview of the Tax Cuts and Jobs Act Overview of the Tax Cuts and Jobs Act Changes to the tax laws affecting individuals for this filing season. Basics for Individuals and Families As part of our client and community outreach we have prepared

More information

Profit Sense YEAR-END PLANNING INDIVIDUALS. In This Issue

Profit Sense YEAR-END PLANNING INDIVIDUALS. In This Issue Never ignore an IRS notice. It won t go away. Deal with it promptly to reduce any penalties and interest. Penalty Increase You should be aware that the penalty for failure to maintain qualifying health

More information

This is a list of items you should gather for the Income Tax Preparation

This is a list of items you should gather for the Income Tax Preparation This is a list of items you should gather for the Income Tax Preparation 1. Social Security Card(s) - Your Social Security number, which is your taxpayer identification number, is printed on your Social

More information

You must file your 2012 tax return

You must file your 2012 tax return ADR Department of the Treasury Internal Revenue Service PO BOX 149338 Austin TX 78714-9338 Notice 2566 Tax Year 2012 Social Security number 999-99-9999 To contact us Phone 1-866-681-4271 Hours of operation

More information

Arizona Form 2011 Property Tax Refund (Credit) Claim 140PTC

Arizona Form 2011 Property Tax Refund (Credit) Claim 140PTC Arizona Form 2011 Property Tax Refund (Credit) Claim 140PTC NOTICE: If you are age 70 or over and meet certain tests, you may be able to defer the payment of your property taxes on your home. You should

More information

Arizona Form 2012 Property Tax Refund (Credit) Claim 140PTC

Arizona Form 2012 Property Tax Refund (Credit) Claim 140PTC Arizona Form 2012 Property Tax Refund (Credit) Claim 140PTC NOTICE: If you are age 70 or over and meet certain tests, you may be able to defer the payment of your property taxes on your home. You should

More information

Questions and Answers on Additional Medicare Tax

Questions and Answers on Additional Medicare Tax Brought to you by Crest Insurance Group, LLC Questions and Answers on Additional Medicare Tax The Affordable Care Act (ACA) increases the Medicare hospital insurance tax rate for high-income individuals

More information

Part 4. Comprehensive Example and Sample Forms Example One: Senior Minister

Part 4. Comprehensive Example and Sample Forms Example One: Senior Minister Part 4. Comprehensive Example and Sample Forms Example One: Senior Minister Note: This example is based on an illustrated example contained at the end of IRS Publication 517. Rev. John Michaels is the

More information

Employee s Withholding Allowance Certificate North Carolina Department of Revenue

Employee s Withholding Allowance Certificate North Carolina Department of Revenue NC-4 Web 11-13 Employee s Withholding Allowance Certificate North Carolina Department of Revenue! Important: You must complete a new Form NC-4 EZ or NC-4 for tax year 2014. As a result of recent law changes,

More information

Sign Here Joint return? See instructions. Keep a copy for your records.

Sign Here Joint return? See instructions. Keep a copy for your records. Form 1040 (99) U.S. Individual Income Tax Return IRS Use Only Do not write or staple in this space. Filing status: Single Married filing jointly Married filing separately Head of household Qualifying widow(er)

More information

QUESTIONS AND ANSWERS ABOUT THE EARNED INCOME TAX CREDIT TAX YEAR 2010

QUESTIONS AND ANSWERS ABOUT THE EARNED INCOME TAX CREDIT TAX YEAR 2010 QUESTIONS AND ANSWERS ABOUT THE EARNED INCOME TAX CREDIT TAX YEAR 2010 The federal Earned Income Tax Credit is designed to boost the wages of working families. The following questions and answers will

More information

GENERAL INCOME TAX INFORMATION

GENERAL INCOME TAX INFORMATION GENERAL INCOME TAX INFORMATION TABLE OF CONTENTS Taxes on Loans from the Annuity Savings Fund 1 (Tier 1 and 2 Members Only) Taxes on the Withdrawal of the Annuity Savings Fund at Retirement 2 (Tier 1 and

More information

TAX FACTS. and Tables 2017 AT A GLANCE

TAX FACTS. and Tables 2017 AT A GLANCE TAX FACTS and Tables 2017 AT A GLANCE Are you making smart financial decisions that can help reduce your taxes The first step in reducing the amount of tax you pay on your savings and personal finances

More information

TAX FACTS. and Tables 2018 AT A GLANCE

TAX FACTS. and Tables 2018 AT A GLANCE TAX FACTS and Tables 2018 AT A GLANCE Are you making smart financial decisions that can help reduce your taxes The first step in reducing the amount of tax you pay on your savings and personal finances

More information

TAX FACTS. and Tables 2018 AT A GLANCE

TAX FACTS. and Tables 2018 AT A GLANCE TAX FACTS and Tables 2018 AT A GLANCE Are you making smart financial decisions that can help reduce your taxes The first step in reducing the amount of tax you pay on your savings and personal finances

More information

Terms. Write down as many payroll terms or payroll taxes that you can think of in 2 minutes. Ready, Set, Go!

Terms. Write down as many payroll terms or payroll taxes that you can think of in 2 minutes. Ready, Set, Go! Payroll Unit Terms Write down as many payroll terms or payroll taxes that you can think of in 2 minutes. Ready, Set, Go! Payroll Pay Periods Weekly 52 checks a year Biweekly 26 checks a year, every other

More information

Chapter 01 Introduction to Taxation, the Income Tax Formula, and Form 1040EZ

Chapter 01 Introduction to Taxation, the Income Tax Formula, and Form 1040EZ Chapter 01 Introduction to Taxation, the Income Tax Formula, and Form 1040EZ True / False Questions 1. The U.S. individual income tax system is an example of a progressive tax rate structure. 2. A proportional

More information

Example Two: Retired Minister

Example Two: Retired Minister Example Two: Retired Minister Form 1040 Rev. William K. Green is a retired minister. He is 69 years old. He is married to Sarah J. Green. She is 65 years old and is also retired. For 2010, Rev. Green received

More information

COVER PAGE. Filing Checklist For 2008 Tax Return Filed On Standard Forms. Prepared on: 01/13/ :55:49 am

COVER PAGE. Filing Checklist For 2008 Tax Return Filed On Standard Forms. Prepared on: 01/13/ :55:49 am COVER PAGE Filing Checklist For 28 Tax Return Filed On Standard Forms Prepared on: 1/13/29 12:55:49 am Return: C:\Documents and Settings\Owner.gateway\My Documents\TaxCut\Donna Harp 28 Tax Return.T8 To

More information

G1. Income & Paychecks. Taxes, W-4, Reading a Paycheck

G1. Income & Paychecks. Taxes, W-4, Reading a Paycheck Income & Paychecks Taxes, W-4, Reading a Paycheck Sources of Income Gifts Investments Financial Aid/Scholarships Self Employment Wages A PAYCHECK! What are the advantages/disadvantages of self-employment?

More information

Why Keep Records? Kinds of Records To Keep

Why Keep Records? Kinds of Records To Keep Why Keep Records? There are many reasons to keep records. In addition to tax purposes, you may need to keep records for insurance purposes or for getting a loan. Good records will help you: Identify sources

More information

2015 Continuing Education Course. THE TAX INSTITUTE th St Bakersfield CA THE TAX INSTITUTE S ANNUAL CPE COURSE 15HR COURSE

2015 Continuing Education Course. THE TAX INSTITUTE th St Bakersfield CA THE TAX INSTITUTE S ANNUAL CPE COURSE 15HR COURSE THE TAX INSTITUTE 424 18 th St Bakersfield CA 93301. 2015 Continuing Education Course THE TAX INSTITUTE S ANNUAL CPE COURSE 15HR COURSE IRS # N56QT-T-00018-15-S, N56QT-U-00017-15-S, & N56QT-E-00019-15-S

More information

MANAGING YOUR TAXES. After Studying This Chapter, You ll Be Able To

MANAGING YOUR TAXES. After Studying This Chapter, You ll Be Able To 3 MANAGING YOUR TAXES The Basics of the U.S. Tax System Starting Point Go to www.wiley.com/college/bajtelsmit to assess your knowledge of managing your taxes. Determine where you need to concentrate your

More information

Arizona Form 2016 Property Tax Refund (Credit) Claim 140PTC

Arizona Form 2016 Property Tax Refund (Credit) Claim 140PTC Arizona Form 2016 Property Tax Refund (Credit) Claim 140PTC NOTICE: If you are age 70 or over and meet certain tests, you may be able to defer the payment of your property taxes on your home. You should

More information

Prepare, print, and e-file your federal tax return for free!

Prepare, print, and e-file your federal tax return for free! Prepare, print, and e-file your federal tax return for free! www.freetaxusa.com Form 1040 Department of the Treasury Internal Revenue Service (99) U.S. Individual Income Tax Return 2017 OMB No. 1545-0074

More information

Withholding, Estimated Payments & Payroll Taxes

Withholding, Estimated Payments & Payroll Taxes CHAPTER 9 Withholding, Estimated Payments & Payroll Taxes Compute income tax withholding from employee wages Determine taxpayers quarterly estimated payments Understand FICA, federal deposit system and

More information

Federal Income Tax and Railroad Retirement Benefits

Federal Income Tax and Railroad Retirement Benefits FROM THE DESK OF Walter A. BARROWS LABOR MEMBER U.S. RAILROAD RETIREMENT BOARD For Publication For Publication February 2012 Federal Income Tax and Railroad Retirement Benefits The following questions

More information

US Tax Information for Diplomatic Families at the Australian Embassy

US Tax Information for Diplomatic Families at the Australian Embassy US Tax Information for Diplomatic Families at the Australian Rick Ward LLC January 25, 2018 Disclosure This presentation has been prepared by LLC. The information in this presentation is current as of

More information

Earned Income Table. Earned Income for EIC, Additional Child Tax Credit and Dependent Care Credit. Common EIC Filing Errors

Earned Income Table. Earned Income for EIC, Additional Child Tax Credit and Dependent Care Credit. Common EIC Filing Errors Earned Income Table Includes Taxable wages, salaries, and tips Union strike benefits Taxable long-term disability benefits received prior to minimum retirement age Net earnings from selfemployment Gross

More information

The Mysteries of Income Tax Returns. MFSRC September 25, 2012 Amy A. Anderson J. D., C.P.A. Assistant Ramsey County Attorney

The Mysteries of Income Tax Returns. MFSRC September 25, 2012 Amy A. Anderson J. D., C.P.A. Assistant Ramsey County Attorney The Mysteries of Income Tax Returns MFSRC September 25, 2012 Amy A. Anderson J. D., C.P.A. Assistant Ramsey County Attorney Where to start Gross income minus above the line deductions, minus personal exemptions,

More information

Avoiding. Social Security Taxation. with Proper Retirement Planning

Avoiding. Social Security Taxation. with Proper Retirement Planning Avoiding Social Security Taxation with Proper Retirement Planning Social Security Background Social Security was established in 1935 to alleviate poverty among the elderly during the Great Depression.

More information

Employer FAQs on new Form W-4

Employer FAQs on new Form W-4 Employer FAQs on new Form W-4 Form W-4 Withholding Allowance Frequently Asked Questions Q: What is a Form W-4? A: Form W-4 is an IRS form that employees give to their employers that provides information

More information

Cut here and give this certificate to your employer. Keep the top portion for your records.

Cut here and give this certificate to your employer. Keep the top portion for your records. Web 10-17 NC-4 Employee s Withholding Allowance Certificate PURPOSE - Complete Form NC-4 so that your employer can withhold the correct amount of State income tax from your pay. If you do not provide an

More information

THE AFFORDABLE CARE ACT Frequently Asked Questions

THE AFFORDABLE CARE ACT Frequently Asked Questions THE AFFORDABLE CARE ACT Frequently Asked Questions We are providing basic information on the ACA in order for you to best prepare for your tax appointment. While we strive to give you complete and accurate

More information

Part-year resident of SD# above Enter date. Tax Type Check one (for an explanation, see instructions)

Part-year resident of SD# above Enter date. Tax Type Check one (for an explanation, see instructions) Do not staple or paper clip. Rev. 10/18 2018 Ohio SD 100 School District Income Tax Return Use only black ink and UPPERCASE letters. File a separate Ohio SD 100 for each taxing school district in which

More information

TAX FACTS AND TABLES at a glance

TAX FACTS AND TABLES at a glance TAX FACTS AND TABLES 2013 at a glance Are you making smart investment decisions that can help Reduce your taxes The first step in reducing the amount of tax you pay on your investments is to get the facts.

More information

US Tax Information for Diplomatic Families at the Canadian Embassy

US Tax Information for Diplomatic Families at the Canadian Embassy US Tax Information for Diplomatic Families at the Canadian Rick Ward LLC January 16, 2018 Disclosure This presentation has been prepared by LLC. The information in this presentation is current as of January

More information

In the District Court of County, Utah. Court Address

In the District Court of County, Utah. Court Address My Name This is a private record. Address City, State, Zip Phone Email I am the In the District Court of County, Utah Court Address Financial Declaration v. Case Number Judge Commissioner Instructions:

More information

UMB BANK, N.A INFORMATION KIT

UMB BANK, N.A INFORMATION KIT UMB BANK, N.A UNIVERSAL INDIVIDUAL RETIREMENT ACCOUNT INFORMATION KIT (EFFECTIVE DECEMBER 1, 2016) 600 University Street, Suite 2412 Seattle, WA 98101 Main: 206.838.9850 Toll Free: 877.701.2883 Fax: 206.838.9851

More information

What s In My Paycheck? compensation package: all of the wages (salary, bonus, commission) and benefits provided by an employer. What s In My Paycheck?

What s In My Paycheck? compensation package: all of the wages (salary, bonus, commission) and benefits provided by an employer. What s In My Paycheck? compensation package: all of the wages (salary, bonus, commission) and benefits provided by an employer wages: money paid or received for work or services completed, usually by the hour, day, or week hourly

More information

US Tax Information for Diplomatic Families at the German Embassy

US Tax Information for Diplomatic Families at the German Embassy US Tax Information for Diplomatic Families at the German Rick Ward LLC February 26, 2018 Disclosure This presentation has been prepared for employees of the World Bank by LLC. The information in this presentation

More information

Part 4. Comprehensive Examples and Forms Example One: Active minister

Part 4. Comprehensive Examples and Forms Example One: Active minister Part 4. Comprehensive Examples and Forms Example One: Active minister Note: This example is based on an illustrated example contained at the end of IRS Publication 517. Rev. John Michaels is the minister

More information

US Tax Information for Diplomatic Families at the Swiss Embassy

US Tax Information for Diplomatic Families at the Swiss Embassy US Tax Information for Diplomatic Families at the Swiss Rick Ward LLC October 18, 2018 Disclosure This presentation has been prepared by LLC. The information in this presentation is current as of October

More information

How Do I Adjust My Tax Withholding?

How Do I Adjust My Tax Withholding? Contents Department of the Treasury Internal Revenue Service What s New for 2011... 2 Reminder.... Publication 919 Introduction... 3 Cat. No. 63900P How Do I Adjust My Tax Withholding? Checking Your Withholding...

More information

2017 Take Home Quiz #1

2017 Take Home Quiz #1 Employee/Independent Contractor 1. To satisfy the Reasonable Basis test and treat a worker as an independent contractor, a company can rely on all of the following methods EXCEPT: A. a private letter ruling

More information

Earned Income Table. Earned Income

Earned Income Table. Earned Income Includes Taxable wages, salaries, and tips Union strike benefits Taxable long-term disability benefits received prior to minimum retirement age Net earnings from self-employment Gross income of a statutory

More information

How to Read Your W-2 Form

How to Read Your W-2 Form How to Read Your W-2 Form Form W-2, Wage and Tax Statement, is used to report your wages for the year and the taxes withheld from them. CSG is required to send you a W-2 by January 31st of each calendar

More information

Deferred Compensation Plan Request for Distribution of Funds

Deferred Compensation Plan Request for Distribution of Funds Deferred Compensation Plan Request for Distribution of Funds 1. Personal Information Name Social Security # Address City State Zip Code Date of Birth Telephone Number (day) (night) 2. Eligibility Termination

More information

Client Newsletter. 551 West 78th Street, Ste. 204, P.O. Box 254 Chanhassen, MN Office: Fax:

Client Newsletter. 551 West 78th Street, Ste. 204, P.O. Box 254 Chanhassen, MN Office: Fax: Client Newsletter 2015 TAX HIGHLIGHTS WITH COMPLIMENTS FROM: RODENZ ACCOUNTING & TAX SERVICE LLC Accounting Business Consulting Tax Preparation Payroll Services Darrell E. Rodenz Certified Public Accountant

More information

State of New Jersey DEPARTMENT OF THE TREASURY DIVISION OF TAXATION P. O. BOX 251 TRENTON, NEW JERSEY 08695

State of New Jersey DEPARTMENT OF THE TREASURY DIVISION OF TAXATION P. O. BOX 251 TRENTON, NEW JERSEY 08695 State of New Jersey DEPARTMENT OF THE TREASURY DIVISION OF TAXATION P. O. BOX 251 TRENTON, NEW JERSEY 08695 October, 2017 Property Administration Fax: 609-292-9439 TO: FROM: RE: County Tax Board Commissioners,

More information

City of Detroit City of Detroit. Forms and Instructions. Filing Due Date: April 18, 2016

City of Detroit City of Detroit. Forms and Instructions.  Filing Due Date: April 18, 2016 City of Detroit 2015 City of Detroit aa aa Income Tax Returns Forms and Instructions Starting with tax year 2015, the Michigan Department of Treasury will begin processing City of Detroit Individual Income

More information

7.3: INCOME STATEMENTS OBJECTIVES

7.3: INCOME STATEMENTS OBJECTIVES Section 7.3: INCOME STATEMENTS OBJECTIVES Interpret and use the information on a pay stub, W-2 form, and 1099 form. Key Terms gross pay net pay take home pay paycheck pay stub Form W 4 withholding tax

More information

University of Utah Payments to Non Resident Aliens

University of Utah Payments to Non Resident Aliens University of Utah Payments to Non Resident Aliens Nonresident Alien Visitors Non-Employee Payments Visa Types: B-1 Business visitor B-2 Tourist visitor WB Business visitor (through visa waiver program)

More information

TAX QUESTIONS

TAX QUESTIONS This Questionnaire is one of the FIVE Minimum Tax Packet Items Page 1 of 7 Taxpayer Names This short questionnaire covers most of the tax reporting areas that I need to know about to prepare accurate tax

More information

Form1040-ES/V (OCR) Department of the Treasury Internal Revenue Service

Form1040-ES/V (OCR) Department of the Treasury Internal Revenue Service Form1040-ES/V (OCR) Department Treasury Internal Revenue Service Purpose of This Package Use this package to figure and pay your estimated tax. If you are not required to make estimated tax payments for

More information

P A R N A S S U S F U N D S

P A R N A S S U S F U N D S PARNASSUS FUNDS P A R N A S S U S F U N D S Useful information about IRAs What is a Traditional IRA? A traditional IRA is an Individual Retirement Account that allows you to put away money for your retirement

More information

NAME: CLASS PERIOD: What Are All These Deductions from My Paycheck?

NAME: CLASS PERIOD: What Are All These Deductions from My Paycheck? 7.1 NAME: CLASS PERIOD: What Are All These Deductions from My Paycheck? It's exciting to receive your first paycheck. But for many young people, that first rush of excitement soon yields to disappointment.

More information

Section 6 Withholding Taxes (Student Guide) Table of Contents Introduction

Section 6 Withholding Taxes (Student Guide) Table of Contents Introduction Section 6 Withholding Taxes (Student Guide) Table of Contents Introduction... - 2 - Topics from Content Outline... - 2 - The Principle of Actual or Constructive Payment... - 2 - Social Security Numbers...

More information

Here are the numbers for :

Here are the numbers for : Page 1 of 7 Here are the numbers for 2017-2018: 1) FICA & Self Employment taxes are comprised of two components: a) Social Security (OASDI) Maximum Earnings Subject $ 127,200 $ 128,400 Tax Rate (Employee)

More information

Basic Information 1. What is the individual shared responsibility provision?

Basic Information 1. What is the individual shared responsibility provision? Affordable Care Act Topics Individuals and Families Employers Other Organizations For Tax Pros What's Trending News Health Care Tax Tips Questions and Answers Legal Guidance and Other Resources Affordable

More information

ATTENTION: NEW NC-4 WITHHOLDING FORMS ENCLOSED

ATTENTION: NEW NC-4 WITHHOLDING FORMS ENCLOSED North Carolina Department of Revenue ATTENTION: NEW NC-4 WITHHOLDING FORMS ENCLOSED IMMEDIATE ACTION REQUIRED North Carolina Department of Revenue TO: IMPORTANT NOTICE: NEW NC-4 REQUIRED FOR PAYMENTS BEGINNING

More information

2017 Fingertip Tax Guide

2017 Fingertip Tax Guide 2017 Fingertip Tax Guide INCOME TAXES 2017 If Taxable Income Is: 1 Married Filing Jointly Estates and Trusts Single $0 $18,650 $0 + 10% $0 $18,650 $75,900 $1,865 + 15% $18,650 $75,900 $153,100 $10,452.50

More information

TY2018 VITA Advanced Certification Test - Study Guide

TY2018 VITA Advanced Certification Test - Study Guide Scenario 1: Smith TY2018 VITA Advanced Certification Test - Study Guide Issue #1 Qualified Education Expenses, Taxable Scholarships (p4012 Tab J) When a taxpayer has more scholarships than Qualified Educational

More information

Client Newsletter 2018 TAX HIGHLIGHTS WITH COMPLIMENTS FROM:

Client Newsletter 2018 TAX HIGHLIGHTS WITH COMPLIMENTS FROM: Client Newsletter 2018 TAX HIGHLIGHTS WITH COMPLIMENTS FROM: A publication of the Minnesota Association of Public Accountants The Minnesota Association of Public Accountants has prepared this newsletter.

More information