Taxes

W-2

• Definition: Form showing how much you earned and taxes taken out.
  Sentence: I used my W-2 to file my taxes.

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W-4

Definition: Form you fill out to tell your job how much tax to take.
Sentence: I filled out a W-4 when I got hired.

1040 Frorm

Definition: The main tax form people use to file their income taxes.
Sentence: I used a 1040 Form to report my earnings.

1099 INT

1099 INT
Definition: Form that shows interest earned from a bank.
Sentence: My bank sent me a 1099 INT for my savings account.

Tax Table

Definition: Chart that shows how much tax you owe based on income.
Sentence: I checked the Tax Table to see how much I owed.

Individual income tax

Definition: A tax you pay on money you earn.
Sentence: I paid Individual Income Tax based on my salary.

Tax Evasion

Definition: Illegally not paying taxes.
Sentence: Tax evasion is a serious crime.

Social security

Definition: Government program that gives money to retired and disabled people.
Sentence: I pay into Social Security from every paycheck.

Gross pay

Definition: Total money you earn before taxes.
Sentence: My gross pay was $500, but I took home less.

Net Pay

Definition: Money you take home after taxes.
Sentence: My net pay was $420 after deductions.

Progressive Tax

• Definition: Tax that takes more from people who earn more.
  Sentence: The U.S. uses a progressive tax system.

Regressive tax

Definition: Tax that takes more from people who earn less.
Sentence: Sales tax is a regressive tax because it affects the poor more.

Adjusted Gross Income

Definition: Your income after certain deductions.
Sentence: I lowered my taxes by reducing my adjusted gross income.

Tax Refund

1. Definition: Money the government gives back if you overpaid taxes.
   Sentence: I got a tax refund of $300 this year.