Test your knowledge

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If you had more income tax taken out of your paycheck than you actually owe in taxes, what can you expect to happen?

Choose wisely. There is only one correct answer.

You will get a refund.

You will owe more taxes.

The government will call it even.

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.

The federal tax rate you pay will vary depending on your age.

Choose wisely. There is only one correct answer.

True

False

False. It varies depending on your filing status.

Only employees pay Social Security taxes on their earnings.

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True

False

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

The difference between a tax deduction and a tax credit is that _______.

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A tax deduction reduces your taxable income, and a tax credit reduces your actual tax

A tax deduction reduces your actual tax, and a tax credit reduces your taxable income

A tax deduction always gets you more money at tax time

None of the above

A tax deduction reduces your taxable income, and a tax credit reduces your actual tax. When you do the math, you will find that tax credits get you more money back than tax deductions do.

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

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Interest paid on student loans

Tuition

Fees

All of the above

All of the above. All of these expenses qualify.

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