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17 Cards in this Set
- Front
- Back
Revenue
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In a free enterprise system such as ours, the government collects money from citizens and businesses in the form of taxes.
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Progressive Taxes
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Are taxes tht take a larger share of income as the amount of income grows. Federal income taxes are progressive.
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Regressive Taxes
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Are taxes that take a smaller share of income as the amount of income grows. Sales taxes are regressive because people with lowere incomes pay a larger percentage of their income for sales taxes than do people with higher income.
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Proportional Taxes
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Or Flat taxes, are taxes for which the rate stays the same, regardless of income.
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Tax Brackets
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Our income tax system is graduated. This means that tax rates increase as taxable income increases. Tax rates apply to income, ranges, or tax brackets.
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Tax Evasion
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Failure to pay taxes, which is a serious crime punishable by a fine or imprisonment or both.
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Audit
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Or examination of their tax returns.
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Exemption
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Is an amount you may subtract form your income for each person who depends on your income to live.
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Gross income
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Is all the taxable income you receive, including wages,tips,salaries, interest, dividends,unemployment compensation, alimony, workers' compensation benefits, and so forth.
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Child Support
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Money paid to a former spouse for support of dependent children.
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Alimony
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Money paid to support a former spouse.
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Adjusted Gross Income
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After these adjustments are subtracted from gross income.
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Deductions
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Are expenses that law allows you to subtract from your adjusted gross income to determine your taxable income.
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Itemize
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To get the tax benefit from your deductions you must list or itemize these allowable expenses on your tax return.
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Standard Deductions
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This is a stated amount that you may subtract form adjusted gross income instead of itemizing your deductions.
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Taxable Income
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which is the income on which you will pay tax.
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Tax Credit
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Is an amount subtracted directly from the tax owed.
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