Question

what does fica stand for and what is its primary purpose? *
federal investment contribution agreement; managing pension funds
federal insurance contribution act; funding retirement and medical benefits
federal income tax administration; collecting government revenue

in a graduated state income tax system, what happens to the tax rate as income increases? *
the tax rate decreases progressively
the tax rate increases for each income level
the tax rate remains constant

what determines the amount of federal income tax (fit) withheld from an employees paycheck? *
age of the employee
income, marital status, and number of dependents
only total income

Explanation:

FICA stands for Federal Insurance Contribution Act, which funds Social - Security (retirement) and Medicare (medical benefits) programs. In a graduated income - tax system, tax rates increase as income rises to ensure those with higher incomes pay a larger proportion in taxes. The amount of Federal Income Tax withheld from an employee's paycheck is determined by income, marital status, and number of dependents as these factors affect an individual's tax liability.

Answer:

1. B. Federal Insurance Contribution Act; funding retirement and medical benefits
2. B. The tax rate increases for each income level
3. B. Income, marital status, and number of dependents