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You can take a tax deduction for some education-related expenses. Which of the following does that include?

Interest paid on student loans

Tuition

Fees

All of the above

All of the above. All of these expenses qualify.

Only employees pay Social Security taxes on their earnings.

True

False

False. Employers pay the same amount on behalf of their employees, according to how much the employees pay.

Which of the following is true regarding tax credits?

A tax credit reduces your taxable income as reported on Form 1040.

A tax credit reduces the actual tax you owe.

For most taxpayers, the standard tax credit will be larger and more valuable than itemizing your credits.

A tax credit reduces the actual tax you owe. Within limits, a dollar of credit reduces your tax by a dollar.

The purpose of the W-4 form that you fill out when starting a new job is to determine _______.

How much you will earn during the year

How much should be withheld from your paycheck for federal income taxes

Whether you will get a refund when doing your taxes

How much should be withheld from your paycheck for federal income taxes. The W-4 helps you and your employer avoid overpaying or underpaying throughout the year.

Having taxes withheld from your paycheck means you do not need to pay any more taxes.

True

False

False. The taxes that are withheld from your paycheck are estimates of how much tax you must pay. Once you have filled out your tax return and determined the actual amount you owe, you will find that you owe more money or that you will get some money back.