Presentation on theme: " 16 th Amendment: Was ratified in 1913. Before this amendment the federal government could not levy income tax. Payroll Deduction: A system requiring."— Presentation transcript:
16 th Amendment: Was ratified in 1913. Before this amendment the federal government could not levy income tax. Payroll Deduction: A system requiring employers to take income taxes from a paycheck and send it directly to the government (IRS). This is how most income taxes are paid throughout the year Tax returns are filed yearly, as a summary of taxes to see if you owe the government money or if they owe you.
A Progressive Income Tax: Our income taxes are progressive, meaning as one makes more money, they pay a higher percentage of income taxes. Indexing: An upward revision of tax brackets to allow employees to receive raises to match inflation without being put in a higher tax bracket
FICA: Federal Insurance Contributions Goes to pay for retirement benefits/benefits for the elderly Also deducted from your paycheck Payroll Taxes Social Security Taxes: This is a capped income, meaning the percentage paid stops going up after a certain point. Covers benefits such as retirement (pension) Medicare: Federal medical insurance for the elderly Meant to cover the major share of eligible persons’ medical bills. Not capped, meaning the amount taxes continues to rise as a person’s income rises
Corporations must pay income taxes as well Corporations are their own legal entity (they are and have always been legally considered to be people), they are responsible for their own profits, loses, and taxes.
Excise Tax: Federal sales tax levied on the manufacture and sale of many items (gas, tires, phone services, tobacco, etc.) Estate and Gift Taxes: Taxes levied on the transfer of property when one dies, ranging from 18-50%. Custom Duties: A charge on goods brought in from other countries. Miscellaneous Fees: User fees such as fees paid to visit a national park.
Intergovernmental Revenues: Funds that are collected by one level of government (national), and distributed to another level (state). Taxes and Fees: State taxes on things such as income, sales, and other various fees. Other Revenues: Usually interest on surplus funds. The Choice of Tax: Optional means of income such as the lottery.
Intergovernmental Revenues: Revenues collected by federal and state governments can also be passed to local governments. Property Taxes: Yearly taxes assessed on your property (land) based upon the value of your property. Other Sources: Revenue from sources such as public utilities, state-owned liquor stores, and local sales tax.