Tax Vocabulary

Vocabulary flashcards covering key personal finance and income tax terms and their definitions.

Audit

When the IRS examines a tax return

Tax Brackets

Tax rates that apply to income ranges

Exemption

The amount you may subtract from your income for each person who depends on your income to live

Dependent

A person who lives with you and for whom you pay more than half of the living expenses

Progressive Taxes

Takes a larger share of income as the amount of income grows

Gross Income

Amount of money before anything is taken out

Proportional Taxes

The taxes stay the same, regardless of income

Tax Evasion

Failure to pay taxes

Itemized Deductions

Expenses subtracted from adjusted gross income to determine taxable income

Regressive Taxes

Takes a smaller share of income as the amount of income grows

Standard Deductions

Stated amount that you may subtract from adjusted gross income instead of itemizing

Filing Status

Describes your tax-filing group

Taxable Income

The income on which you will pay tax