Personal Finance Courses: Taxes

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1.
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. When you do the math, you will find that tax credits get you more money back than tax deductions do.
2.
All other factors being equal, waiting until which age would let you receive the most Social Security benefits?
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70. The longer you wait, up until age 70, the more you will receive in Social Security benefits.
3.
Personal information you will need to prepare your tax return includes _______.
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Your Social Security number. Personal information you will need to prepare your tax return includes your Social Security number.
4.
What type of tax increases as your income increases?
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Progressive tax. Income tax is an example of a progressive tax.
5.
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.