Personal Finance Courses: Taxes

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1.
If you had more income tax taken out of your paycheck than you actually owe in taxes, what can you expect to happen?
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You will get a refund. You had too much taken out. When you do your taxes in the spring, you will find out how much you will get back.
2.
Many retirement plans are tax-deferred. This means that the earnings that build up in them are not taxed until you take them out.
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True. To be tax-deferred means that taxes are not levied until sometime later; in the case of retirement plans, that means when you finally take the money out.
3.
Which saves you more money -- the standard deduction or itemized deductions?
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It depends. For most people, the standard deduction saves more money. But for others, itemized deductions save more. When you do your taxes, you will find out which is better for you.
4.
There is one federal income tax rate that all taxpayers pay.
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False. As you earn more money, your rate increases.
5.
Only employees pay Social Security taxes on their earnings.
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False. Employers pay the same amount on behalf of their employees, according to how much the employees pay.