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PAYDAY

What are Taxes?. Taxes are required payments of money to governmentsThat are used to provide public goods and services and for the benefit of the community as a whole.. What are ?public goods and services"?. 1) Benefits that cannot be withheld from those who don't payEven if you do not make enough

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PAYDAY

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    1. PAYDAY! “Nothing is certain but death and taxes.” -Benjamin Franklin

    2. What are Taxes? Taxes are required payments of money to governments That are used to provide public goods and services and for the benefit of the community as a whole.

    3. What are “public goods and services”? 1) Benefits that cannot be withheld from those who don’t pay Even if you do not make enough money to pay taxes, you can still count on the fire department to put out the fire in your house.

    4. 2) Benefits that may be “consumed “ by one person without reducing the amount of the product or service available for others. It will not use up all the fire service if they put out the fire in your house!

    5. Other examples of public goods and services are: National defense Streetlights, roads and highways Public services including welfare programs Public libraries Law enforcement Monitoring and regulating trade and the economy.

    6. Anycity USA

    7. How does the government collect taxes? The main way that the government collects revenue is through payroll taxes and the Federal Income tax. (There are other ways the government collects revenue, for example sales tax, property tax, etc.)

    8. Payroll Taxes and Federal Income Tax Withholding Let’s take a look at the taxes that are withheld from your paycheck: Social Security Tax Medicare Tax Federal Income Tax

    9. Social Security Taxes Taxes collected to fund federal programs which provide: Retirement benefits Benefits for dependents of retired workers Benefits for the disabled and their dependents

    10. Medicare Tax Used to provide medical benefits for individuals when they reach the age of 65 Workers Retired workers Spouses of workers and retired workers

    11. Income Taxes All income from wages, salaries, commissions and tips is taxable. Federal – supports national programs State – supports state programs (WA has sales tax instead of income tax!)

    12. These taxes are the reason you take home less than you make Your GROSS PAY is the amount of money you earn before payroll deductions. Your NET PAY or TAKE-HOME pay is the amount you receive after deductions. Your NET PAY is what you use to “Pay yourself first” (PYF) Pay your bills Treat yourself to special things you enjoy

    13. How does your employer know how much to withhold from your paycheck? You complete FORM W-4 Your employer uses FORM W-4 to determine how much to withhold from your pay

    14. The amount of federal income tax withholding depends on If you are married or single The number of withholding allowances you claim Any exemptions from withholding that you claim Any additional amount you want withheld (investments, benefits, etc.)

    15. Before January 31st… Your employer reports your wage, salary, tips and tax information on FORM W-2 Wage and Tax Statement Your employer provides FORM W-2 to you and to the federal government. You use FORM W-2 to complete your tax returns

    16. TOMORROW… We get to learn how to calculate our own taxes!!! WOOHOO!

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