Payroll and Taxes exam 2024/2025 with 100% correct answers
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Course
Payroll and Taxes
Institution
Payroll And Taxes
Why does the government need taxes? correct answers- To provide services that people want and need
- Payroll taxes are collected from both you and your employer to pay for things such as FICA (Social Security and Medicare).
What is one example of "mandatory" spending? correct answersSocial Secu...
Why does the government need taxes? correct answers- To provide services that people want and need
- Payroll taxes are collected from both you and your employer to pay for things such as FICA (Social
Security and Medicare).
What is one example of "mandatory" spending? correct answersSocial Security is required by the
government
What is one example of "discretionary" spending? correct answers57% of all discretionary spending goes
to fund the military
What is one benefit that you (or someone you personally know) receives as a result of government
spending? correct answersthe support and services provided to me
What is the purpose of a W-4? correct answers- Lets your employer know how much money to withhold
from your paycheck for federal taxes
- Determines the percentage of gross pay which will be withheld for taxes
What is an allowance? correct answersused to determine the amount of federal taxes withheld from the
paycheck
What is a dependent? correct answersa person who relies on the taxpayer for financial support, like a
child or nonworking adult
Why is it helpful to the taxpayer to have your taxes deducted from every paycheck? correct answersit
allows them to not have to worry about paying them all at once at the end of the year
Why do we pay taxes? correct answerspay for public goods, police, roads, schools, etc.
, Identify and explain two deductions you will see on your pay stub. correct answers- Federal income tax/
state income tax helps pay for things like roads, military, school, police departments, etc.
- FICA includes Medicare and Social Security, which helps fund federal government programs for
retirement and disability
Net pay correct answersthe amount of money you take home after taxes and other expenses are taken
out
Gross Pay correct answersthe money you make before taxes and other expenses are taken out
List and Explain the most important information that the W-2 form tells you correct answers- received in
January
- tells you exactly how much money you made, including tips and wages, and how much was withheld
from your paycheck
What's an advantage to always filing a tax return, regardless of how much money you made? correct
answersit lets the government know how much money you made that year
Why might it be beneficial to file a tax return even if you don't meet the requirements to file? correct
answers- when you file a tax return, you might find that you qualify for tax credits or deductions that
could get you a refund
- the federal income taxes withheld from your paycheck might be more than you actually owe
True or False: The federal government will reach out to you if you are owed a refund. correct
answersFalse; The federal government will not reach out to you if you are owed a refund
Jesse is a full-time college student and is 20 years old. Can he be claimed as a dependent? correct
answersJesse can be claimed as a dependent because he is a student under the age of 24 and he is a full-
time college student.
Wages earned by a worker at a casual fast-food restaurant correct answersTaxable
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