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15 Cards in this Set
- Front
- Back
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Adjusted gross income (AGI) |
Adjusted gross income equals gross income less reductions that are allowed, regardless of whether personal deductions are itemized |
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Credits |
Deductions of tax liability allowed for various purposes to taxpayers who meet the qualifications |
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Earned income |
Income from personal services as distinguished from income generated by property or other sources. Earned income includes all amounts received as wages, tips, bonuses, other employee compensation, and self-employment income, whether in the form of money, services, or property. |
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Exemption |
An amount (3,950 for 2014) allowed by law as a reduction of income that would otherwise be taxed |
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Federal income tax withheld |
The amount taken out the income by payer and submitted to the IRS as an advanced payment of the taxpayer's federal income tax |
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Gross income |
Total worldwide income received in the form of money, property, or services that is subject to tax |
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Income |
The word "income" in its broad sense, is the gain derived from capital, labor, or combination of the two |
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Medicare Part A |
The Medicare tax taken out of an employee's wages, or the same tax paid by self employed person on net self employment income. The Medicare a tax is 1.45% |
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Social Security tax withheld |
Time please share of Social Security tax that was taking out of the employees pay and submitted along with employees share to the IRS by the employer and employee pays 4.2% and employer pays 6.2% of the first 117000 of the employees gross wage |
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Social Security wage |
Total wages paid to an employee that are subject to the tax. This amount does not include tips. Wages or closed subject to the Medicare tax |
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Tax liability |
The amount of total tax to the IRS after any credits and before taking into account any advance payment made by the taxpayer. |
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Taxable income |
Adjusted gross income, less itemized deductions or the standard deduction, less allowable personal independent exemption amounts. |
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Unearned income |
Taxable income other than that received for services performed. Unearned income involves money received for the investment of money or other property, such as interest, dividends, and royalty. It also includes pensions, alimony, unemployment compensation, and other income that is not earned |
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Wage |
A compensation, usually financial, received by workers in exchange for their work |
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Schedules and forms |
Are official IRS documents used to report various types of income, deductions, and credits. |
