1. Taxes Using the IRS “1040EZ” Form
"Taxes are the price we pay for civilization."
What does this quote mean?

2. What do you already know?
Based on what you know, how would you explain income taxes in the United States?
What could be done to improve the taxation system in the United States?
How would you justify taxation; someone that is getting paid more, as a result is getting taxed more (fair/unfair)?

3. Expectations-Taxes Unit
It is expected that students will…establish the meaning of vocabulary terms, analyze key points, and understand the practical analysis of 1040EZs and W-4s as they are used in relating to filing taxes.
It is expected that students will…Formulate a 1040EZ with 100% Accuracy.
Essential Questions
What is a W-4 form, explain the reasoning for higher allowances?
What is the difference between earned income and unearned income? Give an example of each.
For what reasons is the 1040 EZ the most used tax form for high school students?

4. Do You Know…
What form do you get from your employer at the end of the tax year if you had federal tax withheld from your paycheck?
V-1
V-2
W-1
W-2

5. Do You Know… Where can you most likely NOT get the 1040EZ form?
Local Library
Post Office
School Library
Online

6. Do You Know…
This is price that most tax preparers will charge for a 1040 Tax Form with itemized deductions (Schedule A) plus a state tax return.
$260
$100
$200
$75
260!

7. Taxes –
A sum of money demanded by a
government to support the
government itself as well as
specific facilities or services

8. United States Community State County City/Town
Common Interests and concern for the common good. What are some benefits of being part of a community?

9. Military for national security
Community
Military for national security
Roads
Public Schools
Police and Fire departments
Libraries
Recreation (Parks and Trails)
What are some ways we would pay for the different luxuries we are afforded if we did not have taxes? What do you think the USA would look like without taxes?

10. Take home pay How much money is a good decent living?
How much do you plan on making when you first get out of college?

11. How we pay taxes… Income Tax Payroll Property Sales Excise
Excise tax, on gasoline its included in price.

12. Debt now equals $17.075 trillion

13. Where does revenue come from?
Higher income = more tax paid.
Payroll taxes (set Percentage)
Based on earnings, paid to government by your employer.
Supports Social Security and Medicare (FICA).
Income Taxes
You pay on income you receive, Varies on financial and family situation
Earned Income – money from working
Unearned Income – other sources other than employment
You are responsible for calculating
Unearned Income: Interest, investments, Social security, Unemployment benefits, Alimony

14. SS and FICA Social Security FICA 24% Social Security
Income for Retirees
People with profound disability
Children who lost a parent
Death of Spouse
FICA
Helps pay for health care
24% Social Security
15% Medicare
15% Defense
13% Health
13% Income Security
6% Net Interest
5% Veterans Benefits
6% Other
3% Education

15. So you got the job! W-4 Allowance
Tells the employer the correct amount of tax to withhold from an employee's paycheck based on the employee's marital status, number of exemptions and dependents and other factors
Allowance
Number that reduces the amount of money withheld from your pay
The larger the allowances the less amount withheld
0,1

16. Allowances Claiming Zero Allowances
The maximum amount of taxes is withheld. Meaning, when it comes time to file your tax return you will most likely receive a refund.
If you are claimed as a dependent on someone else’s tax return, you should claim zero allowances.
Claiming One Allowance (best option if you are single with one job)
 If you are single and have one job, by claiming one allowance will most likely result in a refund when you file your taxes.
Claiming two Allowances
If you’re married, you can claim two allowances – one for you and one for your spouse.

17. Withholding Withholding too much Withholding too little
Payroll calculated on ANTICIPATED annual salary
Results in refund
Withholding too little
Funds due to government when taxes are filed
Payments can be made
Reduce allowances (0, 1, 2)
Specify extra $$ withheld on W-4
(Claiming zero allowances means less take home pay, but a bigger tax refund during tax season.)

18. Tax Documents W-2 Form 1099-INT
Given to you by your employer by Jan 31.
Form 1099-INT
Interest from the bank. Counts as income
Form 1040 – Used to file taxes if you have many itemized deductions
Form 1040-EZ – Used to file taxes if
You have no dependents (people you support financially)
You and your spouse are under 65
Neither you nor your spouse is blind
Your taxable income is less than $100,000
You earned no more than $1500 in interest
You had no income other than wages, interest, tips, scholarships, or unemployment compensation

19. Dependents
A dependent is a person other than the taxpayer or spouse who entitles the taxpayer to claim a dependency exemption. Each dependency exemption decreases income subject to tax by the exemption amount. The exemption amount for is $4050.
A dependent may be either a "Qualifying Child" or a "Qualifying Relative."

20. Tax Table
$57,311

21. Tax Table
$57,311-$4050 = $53,261

23. Tax Return You are responsible for calculating
A tax return is a form that individual taxpayers file with the federal, state or local governments to declare what they owe in taxes or to calculate the refund the government owes because the taxpayers paid too much during the year.
You are responsible for calculating

24. Review Essential Questions Do I need to File?
Justify the reasons for taxation.
What is a W-4 form, why do people choose a higher allowance?
What is the difference between earned income and unearned income? Give a real world example of each.
Do I need to File?

25. When is the filing deadline for taxes?
April 15 of the following year…But that’s a Sunday this year…so it’s on the 17th.

26. Expectations It is expected that students will:
Formulate a 1040 EZ with 100% Accuracy.
Every 1040 EZ submitted on Moodle (can be re done)
Project Grade (40%) & It is part of your Final Exam
A 1st Attempt 100%
B 2nd Attempt 80%
C 3rd Attempt 70%
D 4th Attempt 60%
New w-2 form for each attempt

27. Laura Lou

28. Billy Bob

29. IRS Scam

30. Jay-Z on Taxes
Do you support this view?
Is it fair/unfair?