chapter 4: planning: taxes study guide\nthis guide is structured around the learning objectives and key…
chapter 4: planning: taxes study guide\nthis guide is structured around the learning objectives and key topics in the chapter on tax planning.\ni. major tax types and financial planning (l o 4.1)\na. the role of taxes in financial planning\nwhat is the primary goal of tax planning?\nwhat three actions are involved in the tax planning process?\nwhat is \tax freedom day\ and what does it represent?\nb. types of taxes\ntaxes on purchases:\nwhat is a general sales tax?\nwhat is an excise tax, and what are some examples of goods and services subject to it?\ntaxes on property:\nwhat is real estate property tax based on?\nwhat is a personal property tax?\ntaxes on wealth:\nwhat is an estate tax and by which level of government is it typically imposed?\nwhat is an inheritance tax and by which level of government is it typically imposed?\ntaxes on earnings:\nwhat are the typical combined percentages for social security and medicare taxes?\nwho is responsible for contributing to these taxes besides the worker?\nwhich levels of government may impose an income tax?\nii. calculating taxable income and federal income tax owed (l o 4.2)\na. step 1: determining adjusted gross income (agi)
Answer
Brief Explanations:
The primary goal of tax planning is to minimize tax liability legally. The three - actions in the tax planning process are: 1) Analyzing current tax situation, 2) Identifying tax - saving opportunities, 3) Implementing tax - saving strategies. Tax Freedom Day represents the day when the average taxpayer has earned enough money to pay off their total tax obligations for the year. A general sales tax is a tax on the sale of goods and services, and examples of goods and services subject to it include clothing and restaurant meals. An excise tax is a tax on specific goods and services like gasoline and tobacco. Real estate property tax is based on the assessed value of real property. Personal property tax is a tax on movable personal assets. An estate tax is a tax on the transfer of a deceased person's estate, typically imposed by the federal government. An inheritance tax is a tax on property received by an heir, also often imposed by state governments. The typical combined percentages for Social Security and Medicare taxes are around 15.3% (with the employer also contributing). Besides the worker, the employer is responsible for contributing to Social Security and Medicare taxes. Federal, state, and in some cases local governments may impose an income tax.
Answer:
- What is the primary goal of tax planning? Minimize tax liability legally.
- What three actions are involved in the tax planning process? Analyze current tax situation, identify tax - saving opportunities, implement tax - saving strategies.
- What is "Tax Freedom Day" and what does it represent? The day when the average taxpayer has earned enough money to pay off total tax obligations for the year.
- What is a general sales tax? A tax on the sale of goods and services. Examples: clothing, restaurant meals.
- What is an excise tax, and what are some examples of goods and services subject to it? A tax on specific goods and services. Examples: gasoline, tobacco.
- What is real estate property tax based on? Assessed value of real property.
- What is a personal property tax? A tax on movable personal assets.
- What is an estate tax and by which level of government is it typically imposed? A tax on the transfer of a deceased person's estate, typically federal.
- What is an inheritance tax and by which level of government is it typically imposed? A tax on property received by an heir, typically state.
- What are the typical combined percentages for Social Security and Medicare taxes? Around 15.3%.
- Who is responsible for contributing to these taxes besides the worker? The employer.
- Which levels of government may impose an income tax? Federal, state, and in some cases local.