Personal Finance/Unit 2 Vocab

Taxes a sum of money demanded by a government to support the gov’t itself as well as specific facilities or services
Paid by taxpayers a person who pays a tax to national, state, county, or municipal (city/town) gov’t
Community a group of people with common interest and concern for the common good. EX: United States, State, County, City/town
Types of taxes income tax, sales tax, excise tax, payroll tax, property tax
Taxes are a way members of a community provide for one another. True OR false True
How do you benefit from taxes.? Make a list of things you use or benefit from that were funded, at least in part, by taxes. How do these items contribute to your well-being? social, emotional, financial, physical, intellectual
Income tax tax on earned and unearned income
Earned income money earned from working for pay EX: wages & salaries earned from employment
Unearned income income received from sources other than employment EX:
Excise tax taxes collected from the seller or retailer and as such often remain “hidden” in the price of a product of service, rather than being listed separately
Payroll tax a tax on earned income that supports the Social Security & Medicare programs (known as FICA)
Property tax a tax on property such has land, buildings (including homes) and automobiles
Sales tax a tax on purchased goods and services
Tax payer a person who pays a tax to national, state, county or municipal gov’t
You are better off being a community than by yourself a group of people with common interest and concern for the common good, It would be difficult, individually,to create many of the benefits provided
What are two benefits you receive from the taxes you pay attending a public school, driving on roads, law enforcement/fire dept/military to keep you safe
What are two items or services that federal income tax help pay for? roads, schools, stoplights, sidewalks, parks, trails
What is the Social Security program? a federal govt program that helps citizens fund retirement, as well as helps people who have a profound disability, are under the age of 18 & experience the premature death of a parent, or spouse in a family with minor children
What is the Medicare program? main purpose is to help pay for health care for senior citizens in the USA
Federal Income Tax Earned & unearned income. the higher your income the more tax paid. Helps fund programs sponsored by the federal govt, including the operations of the three federal govt branches
State Income Tax Earned & unearned income. the higher your income the more tax paid. On education & health care as well as fund state highways the operation of state govt
How do taxes relate to the principle “You are better off being in a community than by yourself?” Taxes help fund the creation of roads, public schools, libraries, police and fire dept. military for national security, govt safety net programs,
As a person living in the US you are a taxpayer. What are two benefits you receive from the taxes you pay? attending a public school, driving on roads, law enforcement/fire dept./military to keep you safe
What is the difference between earned & unearned income. Provide examples Earned from working for pay such as wages or salaries. Unearned income received from sources other than employment such as the interest from a savings account
What are two items or services that federal income tax helps pay for? roads schools, stoplights, sidewalks, parks, trails
What is one difference between income & payroll tax? Income tax is paid on both earned & unearned income whereas payroll tax is paid on only earned income
Two examples of what you pay property tax on? House, land, boat, camper, motorcycle
What is one difference between sales tax and excise tax? Sales tax is added to the price of an item when it is bought. Excise tax is usually already included within the price of an time, such as when you purchase gas

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