Personal Finance Courses: Taxes

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1.
Retired workers receive more in benefits from Social Security than they contributed to it during their working years.
Choose wisely. There is only one correct answer.
True. They receive more; this is a big advantage during one's retirement years.
2.
Having taxes withheld from your paycheck means you do not need to pay any more taxes.
Choose wisely. There is only one correct answer.
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.
3.
How do IRAs, 401k plans, health savings accounts and flexible spending accounts help lower your income taxes?
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You get to deduct the money you contribute to them from your income. When you deduct the contributions you make to them, there is less money for you to be taxed on.
4.
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.
5.
There is one federal income tax rate that all taxpayers pay.
Choose wisely. There is only one correct answer.
False. As you earn more money, your rate increases.