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| Businesses, Politicians,individuals |
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| A payment required by a government agency that is unrelated to any specific benefit or service received from the government agency |
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| level of taxes imposed on the tax base and is usually expressed as a percentage |
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| defines what is actually taxed and is usually expressed in monetary terms |
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| Formula for calculating tax |
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| 3 different ways to measure tax rates |
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| Marginal Tax Rate, Average Tax Rate, Effective Tax Rate |
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| the tax rate that applies to the next additional increment of a taxpayers taxable income |
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| the taxpayers average level of taxation on each dollar of taxable income |
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| the taxpayers average rate of taxation on each dollar of total income (both taxable and non-taxable) |
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| total tax / taxable income |
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| the base is divided into a serious of monetary accounts, or brackets, a portion of the tax base is subject to a specific tax rate |
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| flat tax, progressive tax, regressive tax |
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| imposes a constant tax rate throughout the tax base |
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Definition
| flat tax rate (proportional tax rate) |
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| imposes an increasing marginal tax rate as the tax base increases |
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Definition
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| imposes a decreasing marginal tax rate as the tax base increases |
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Definition
| income taxes, employment and unemployment taxes, excise taxes, and transfer taxes |
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| federal tax used to cover government programs |
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Definition
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| federal tax used to fund social security, medicare, and unemployment payments |
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Definition
| employment and unemployment tax |
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| federal tax that is the quantity of product sold (alcohol, gasoline) |
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| federal tax against transfers of wealth (estate taxes, gift taxes) |
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Definition
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| types of state and local taxes |
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Definition
| sales and use, property, income |
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| state and local tax used for retail sales made in and out of the state |
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| state and local tax on real and personal property |
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| state and local tax used to fund state govt programs |
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| a tax not paid directly to the government |
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Definition
| indirect tax (implicit tax) |
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| indirect taxes that result from a tax advantage the govt grants to certain transactions to satisfy social, economic , or other objectives |
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| income never included in taxable income |
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| income included in a subsequent tax year |
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| the US uses what type of tax rate schedule |
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| payments already made towards tax liability |
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Definition
| income taxes withheld from wages by employer, estimated tax payments made during the year, taxes over payed in prior year and applied toward current year |
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Definition
| for taxpayer and spouse if married filing jointly |
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Definition
| for those who qualify as the taxpayers dependents |
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| dependency requirements are |
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Definition
| citizen of the US or resident of the US, Canada or mexico. Must be qualifying child or qualifying relative of taxpayer |
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| Test to determine if qualifying child |
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Definition
| Relationship test, age test, residence test, support test |
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| taxpayers son, daughter, stepchild, eligible foster child, brother, sister, half brother, half sister, step brother, step sister, or a descendant of any of these relatives is used to determine what qualifying child test |
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Definition
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| child must be under younger than the individual claiming the child to qualify for what test |
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| child must share the same residence as taxpayer for more than half the year. qualifying test- |
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| child must not provide more than half or his or her own support. qualifying test- |
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Definition
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| qualifying relative must pass what tests |
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Definition
| relationship test, support test, and grow income test |
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| 5 different filing statuses |
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Definition
| married filing jointly, married filing separately, qualifying widow or widower, single, head of household |
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| to file and married filing jointly you must be married on the last day of the year true or false |
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Definition
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| If one spouse dies within the year how do you file |
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| if taxpayers are married but file separate returns they are called |
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Definition
| married filing separately |
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Term
Jeremy and Annie are married. During the year Jeremy dies. When Annie files her tax return for the year, she may file under the married filing jointly filing status.
true or false |
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Definition
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An individual may meet the relationship test to be a taxpayer's qualifying relative even if the individual is unrelated to the taxpayer.
true or false |
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Definition
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To be considered a qualifying child of a taxpayer, the individual must be the son or daughter of the taxpayer.
true or false |
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Definition
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Term
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Definition
| When two taxpayers in similar situations pay the same tax. |
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| When taxpayers use existing tax law to minimize their tax liability. |
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Definition
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| When taxpayers deliberately misrepresent or conceal the true state of their affairs to a tax authority to reduce their tax liability. |
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| AGI- Deducted in determining adjusted gross income |
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Definition
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| AGI- Deducted from adjusted gross income to determine taxable income |
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Definition
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