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.
The purpose of the W-4 form that you fill out when starting a new job is to determine _______.
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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.
3.
Several different tax forms that get sent to you will list the income you received during the year. Which of the following does NOT list income that you received?
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W-4. Your W-4 does not list income you received. But your W-2s and any 1099s you receive will.
4.
You can take a tax deduction for some education-related expenses. Which of the following does that include?
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All of the above. All of these expenses qualify.
5.
Retired workers receive more in benefits from Social Security than they contributed to it during their working years.
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True. They receive more; this is a big advantage during one's retirement years.