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what taxes pay for
government goods and services
services provided by the gov through taxes
national defense, police and fire, public schools, public parks
criteria required for something to be a public good or service
nonexcludable (citizens can’t be prevented from using), nonrivalrous (can be used by many or all citizens at the same time)
example of public assistance program
Supplemental Nutrition Assistance Program (SANP), provides money in form of debit card for poor people to buy food
purpose of public assistance programs
help keep society stable
deregulation
stopping or decreasing government regulation of an economic activity
possible positives of deregulation
creates competition, lowers prices
possible negatives of deregulation
less workplace safety, manufacturing practices damage the environment, unfair labor policies
social security
provide income to individuals who have reached the age of legal requirement or are unable to work
FICA taxes
taxes taken out of you check for social security and medicare (6.2% for SS, 1.45% for medicare, paid by employee and employer)
excise taxes
taxes on specific products to pay for the cost of a product or to discourage use of the product (ex. airline ticket, cigarettes, alcohol)
estate taxes
taxes placed on the value of a person’s property after they die, tax on wealth
corporate taxes
taxes placed on business profits
capital gains tax
tax paid when an investment such as stocks are sold for a profit
progressive tax
tax paid at a different rate depending on income level (more money means higher taxes)
gas tax
pays for road and bridge construction/repair, 18.3 cents per gallon of gasoline, 24.3 cents per gallon of diesel
income tax
tax paid on wages and any other sources of income, 4.99%
flat tax
tax paid in the same proportion regardless of income
sales tax
tax paid at certain percentage of the price of the product being purchased (state is 4.75%, county is 2-2.75%)
only local tax in NC
property tax (tax on value of property, supports local gov)
fees we pay
registering a business, filing a civil lawsuit, renewing car registration, camp in state park, college fees (tuition, book, meal plan, room and board)
surplus
gov that raises more in funds in taxes than it spends
deficit
gov that spends more than it takes in through taxes
spending controlled by congress and percent of federal budget
discretionary spending, 35%
mandatory spending items
social security and medicare, interest on federal debt, entitlement programs
reason for mandatory spending increase to more than 60%
aging US population and growing national debt
economic development
grants, loans, and reimbursements for businesses that create jobs
infrastructure development
repairing and rebuilding roads, airports, bridges, public transportation, rail lines, and facilities needed by businesses in order to encourage development
education
provide money for different educational programs
general welfare/quality of life cooperative extension service
partnership between NCSU, NC A&T, and community agencies to help NC with nutrition, health, gardening, conservation and environmental issues, and to help farmers through research and technology
government operation board of election
each county has one that is responsible for carrying out the election process efficiently
emergency management agencies
agencies concerned with public safety and those concerned with natural disasters
jails, prisons, youth detention centers
Jails, those accused of a crime and awaiting trial or convicted of a misdemeanor. Prison, those convicted of felonies. Detention centers are where convicted juveniles are housed
tax assessment
assess the value of property within a given county for the purpose of properly levying taxes
social services
provide services such as placement for abused children, investigating alleged child abuse, helping underprivileged families, assisting with mental illness, helping families faced with crisis
opposing viewpoint on the state lottery
raises money for education without raising taxes, entices the poor to spend money they need to live in hopes of getting rich
W-4 forms
withholding certificate to estimate how much of their paycheck should be deducted for taxes so that none are owed at the end of the year
exemptions
situation that keep people or organizations form paying taxes on some or all of their income
dependent
child or relative who relies on a taxpayer for support
deductions
expenses taxpayers can claim and take off their income when they file their taxes to reduce their taxable income
head of household
an unmarried person with dependents
premiums
payments people make for insurance
health insurance
helps to cover medical care
affordable care act
federal program that provides assistance in finding health insurance
medicare
government run health insurance program for seniors and disabled
medicaid
government run health insurance program for lower income people
retirement accounts
long-term investments designed to pay money to people when they are older and no longer work at a job
pensions
retirement accounts established for workers but heir employers
401(k)
retirement plan offered by employers where money is automatically taken out of your paycheck and often the amount is matched by the employer, only taxed when money is taken out
403(b)
plan that covers public schools and nonprofits, annuity that pays a fixed amount per month, contributions are sheltered
individual retirement account (IRA)
retirement program that can be offered by employers or an employee can invest in on their own
traditional IRA
contributions are a tax deduction, when money is withdrawn it is then taxed, must start taking money out at age 72
Roth IRA
contributions are taxed when taken out of your paycheck, you do not pay taxes on any money withdrawn after age 59.5
flexible savings accounts for healthcare
money used to pay for medical expenses not covered by health insurance
529 plan
savings for college
union dues
pays for membership in a union
involunt
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