1. You and Taxes

2. What are taxes?
1. Income Tax
Is taxes that are taken directly out of
your check.
Other types of taxes:
Property Tax, Real estate tax,
Sales tax, inheritance tax

3. What’s the point?
Why do we pay taxes?
Taxes pay for things like roads, national
defense, government jobs, schools,
public libraries, law enforcement, government programs

4. How do you they know?
W-4:
A form you fill out before you start working. The
employer uses this to see how much money to
with hold from your check.
In a W-4 you will specify:
whether you’re married or single
how many allowance you claim
how many dependents you have

5. What do you need to file?
W-2:
you receive this in Jan. that tells
how much you made last year
and how much you paid in taxes.
You need this form to get your taxes done.
You can do your own taxes or you can pay an accountant
to do your taxes for you.
Ever heard of H & R block???

6. What they use to file..
1040EZ:
This is what most of you would use to do your taxes.
If you do not have children and make less than $100,000
When you receive money after you file your taxes that mean
that you were taxed more than you should have been.
If you have to pay taxes that means that you were not
taxed enough that year.

7. What are deductions?
Itemized deductions:
Things that you can take off your income.
Ex. paying interest, charitable donations,
education credits.
The more itemized deductions you have, the more
you will receive back in taxes.
Standard Deduction:
A $ amount that you do not have to
pay taxes on if you can’t itemize.

8. Itemized Deductions
Itemized Deduction:
Things like paying Interest on mortgage
or student loans.
Giving to charities
Education expenses
If you total up all of those amounts and they are
more than the standard deduction ($5000)
then you would want to itemize.

9. Other information
• AGI (Adjusted Gross Income) this is the
amount after you subtract your reductions.
• Dependent: Someone who depends on a
tax payer (usually a child)
• Gross Income: when you get paid, it’s the
money before taxes are taken out.
• Joint Return: When you file with your
husband or wife.