Personal Finance Courses: Taxes

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1.
Social Security is a federal _______.
Choose wisely. There is only one correct answer.
Retirement and disability income program.
2.
Which of the following is true regarding tax credits?
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A tax credit reduces the actual tax you owe. Within limits, a dollar of credit reduces your tax by a dollar.
3.
Many retirement plans are tax-deferred. This means that the earnings that build up in them are not taxed until you take them out.
Choose wisely. There is only one correct answer.
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.
4.
The various income tax filing statuses include _______.
Choose wisely. There is only one correct answer.
All of the above. There are several statuses that determine your rate.
5.
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.