1 / 20

“Taxes are what we pay for civilized society” Oliver Wendell Holmes Jr., 1904

TAXES. “Taxes are what we pay for civilized society” Oliver Wendell Holmes Jr., 1904. Essential Questions. Are taxes necessary in society? How does the government collect taxes from its citizens? How do taxes impact our lives

miriam-hamilton
Download Presentation

“Taxes are what we pay for civilized society” Oliver Wendell Holmes Jr., 1904

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. TAXES “Taxes are what we pay for civilized society” Oliver Wendell Holmes Jr., 1904 Essential Questions Are taxes necessary in society? How does the government collect taxes from its citizens? How do taxes impact our lives (Tax, income tax, sales tax, property tax, W-2, W-4, I-9, 1040 EZ, IRS, tax bracket, payroll deductions, tax evasion, tax avoidance, tax deductible, tax credit, dependent, allowance)

  2. Taxes:Required charges imposed on citizens by local, state, & federal governments. Used to provide public goods and services. Sales Tax: Tax on sale of items - (regressive) Income Tax: Tax on earnings - (progressive) Property Tax: Tax on property (Ex. land, cars) Capital Gains Tax: Tax on sale of assets (Ex. stocks) Gift Tax: Tax collected on money/property valued over $11,000 Estate Tax: Fed. tax on value of someone’s property upon death Internal Revenue Service (IRS): Collects federal taxes Enforces tax laws written by US Congress.

  3. Government Taxes Where it goes Surplus to Pay Down the Debt 6% Law Enforcement and General Government 2% Social Security, Medicare and other Retirement 36% Where it comes from Social Programs 18% National Defense, Veterans and Foreign Affairs 18% Personal Income Taxes 50% Community Development 10% Interest on the Debt, 10% SS, Med, & unemployment 35% Excise, customs, estate, gift, and miscellaneous Taxes 8% Corporate Income Taxes 7%

  4. Taxes Fund Public Goods and Services Health Care for Elderly National Defense Social Services State and Local Police Public Education Financial Aid

  5. Sales Tax A sales tax is a tax, usually paid by the consumer at the point of purchase for certain goods and services. % of value * Dif. states & cities have different tax rates that vary depending on item Excise Tax: applied to select group of products like gas Alcohol & tobacco (sin tax)

  6. Property Taxes • Levied on property, especially real estate • - If value of property goes up, so does tax • Can also be levied on cars, boats, RVs • Fund schools, local services, welfare programs

  7. Federal & State Income Taxes • Come from earned and unearned income (1099 Form) • Levied on individuals and corporations • Support federal & state expenses, education programs, welfare, national defense, police & fire, roads… • The more you make, the higher percentage you pay

  8. 2011 Tax Brackets

  9. I have a job, now what???? W-4 1. Complete a W-4 Form (Employee’s Withholding Allowance Certificate) • Used to determine the amount of federal taxes withheld from the paycheck • Claim how many dependents you have • The more allowances you have, the more of your paycheck you may keep (allowances or dependents allow you to keep more of your money = pay less tax) Dependent:Person who relies on the taxpayer for financial support

  10. Pay-As-You-Go Withholding • Taxes are paid as income is earned • Taxes are withheld based on Form W-4 information

  11. 2. Complete an I-9 Form (Employment Eligibility Verification) • Employment Eligibility Verification Form • Used to verify the eligibility of individuals to avoid hiring undocumented workers or others who are not eligible to work in the United States • Must provide documentation which establishes identity and employment eligibility • Examples include driver’s license, passport, Social Security card, and birth certificate

  12. Ways you may be paid • Paycheck: Check for salary or wages made out to an employee • Employee must deposit/cash check • Check and paystub given to employee • 2. Direct Deposit: Electronic transfer of an employee paycheck by • an employer • Automatically puts paycheck into employee designated account • Paystub may be given or accessed electronically • Secure & quick

  13. Employee Pay How often you are paid? Pay Period : Weekly: 52 per year Bi-weekly: 26 per year Semi-Monthly: 24 per year Monthly: 12 per year • How are people paid? • Hourly: based on # hours in period • Overtime: Hours worked beyond the regular work week. • Salary: Fixed amount paid each pay period regardless of hours worked. • Commission:Amount made based on percentage of employee sales. Standard workday: 8 hours Standard work week: 40 hours.

  14. What happens to my money?? About 1/3rd of more of your paycheck will go to taxes Taxes are immediately paid on income earned http://www.bankrate.com/calculators/tax-planning/hourly-paycheck-tax-calculator.aspx

  15. Document included each pay period which outlines deductions Paycheck Stub

  16. Form W-2 • Shows how much employees earn • Copy must be attached to tax return

  17. Tax Avoidance versus Tax Evasion Tax Avoidance: Legal means of decreasing your tax bill Tax Evasion: Failure to pay legally due taxes

  18. Tax Breaks Deductions: Reduce income subject to tax Exemptions: Part of income that isn’t taxed Credits: Dollar for dollar reduction in tax

More Related