Which of the following is an example of a progressive tax system? A) Social security tax B) A sales tax C) A proportional tax D) U.S. Federal Income Tax | Homework.Study.com (2024)

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• Which of the following is defined as a tax rate that decreases when the tax base increases? a. Average tax b. Proportional tax c. Marginal tax d. Progressive tax e. Regressive tax
• Assume a tax system with a tax of $1,000 on taxable income of $10,000 and a $1,500 tax on taxable income of $20,000. Is the tax rate system: A. Progressive B. Regressive C. Proportional D. None of the above.
• (a) What is a regressive tax? (b) Why is the social security tax considered a regressive tax?
• Assume a tax system with a tax of $1,000 on taxable income of $1,500 tax on taxable income of $20,000. Is the tax rate system: a. None of the above. b. Progressive c. Regressive d. Proportional
• Which of the following taxes are likely to be regressive taxes? a. Income taxes based on ability to pay. b. Sales taxes and use taxes. c. Additional sales and use taxes imposed on luxury vehicles. d. None of the above.
• Which of the following taxes are likely to be regressive taxes? a) Sales taxes and use taxes. b) Income taxes based on ability to pay. c) Additional sales and use taxes imposed on luxury vehicles. d) None of the above.
• What is a progressive tax? Why is the federal estate tax illustrative of a progressive tax?
• Which, if any, of the following taxes are proportional (rather than progressive)? A) State general sales tax B) Federal corporate income tax C) Federal estate tax D) Federal individual income tax E) All of these
• Which of the following taxes has a ceiling on the amount of annual earnings subject to tax? a. Sale tax. b. Federal income tax. c. FICA - OASDI taxes. d. FICA Medicare taxes.
• Describe an alternate tax system such as the flat income tax, national sales tax, or a hybrid of the two, and compare it to the current tax code.
• Which of the following statements about the FICA tax is not true? (a) The FICA tax is composed of two parts, Social Security and Medicare. (b) Self-employed individuals may elect to pay either FICA taxes or self-employment taxes. (c) FICA taxes are paid b
• A progressive income tax is one where: A. All taxpayers pay the same rate of tax. B. Tax rates increase when the tax base increases. C. The rate of tax decreases as the tax base increases. D. None of these.
• Is a property tax generally a progressive, proportional, or a regressive tax? Explain.
• Which of the following payroll taxes has a maximum of earnings subject to the tax? A. State unemployment tax B. FICA Social Security C. FICA Medicare D. All of these E. Both state unemployment tax and FICA Social Security
• Which of the following statements regarding Social Security tax is false? a. Social Security tax was first levied on employees in 1937. b. All earnings of an employee that exceed the taxable wage base
• Which of the following would be used to compute the federal income taxes to be withheld from an employee's earnings? a. FICA tax rate b. Wage and tax statement c. FUTA tax rate d. Wage bracket and withholding table
• Which of the following statement is correct? A) The benefit of a tax credit depends on the taxpayer's marginal tax rate. B) Tax deductions are less valuable for high-income taxpayers than for low-income taxpayers. C) Tax credits reduce tax liability on
• A tax rate that remains the same as the tax base increases is an example of what kind of tax rate structure: a- progressive b- proportional c- regressive d- recessive
• Which is not a source of federal revenue? Income taxes on Corporations Library Tax FICA taxes Estate and Gift Taxes
• Which of the following is paid by the employer only? A. OASDI tax B. Employee income tax C. Medicare tax D. Federal unemployment tax
• Which of the following taxes does not represent a payroll deduction a company may incur? a. Federal income taxes b. FICA taxes c. State unemployment taxes d. State income taxes
• Which of the following statements is true? A. The transfer tax rate schedule is regressive in nature. B. The same transfer tax rate schedule is used to calculate both the estate tax and the gift tax. C. The exemption equivalent automatically offsets tr
• Based on a tax system that has been proposed to replace the current tax system, the Value Added Tax system, tax savings strategies to avoid Estate Tax or the Fair Tax Act Proposal. Explain the expected impact on the economy, the IRS and other factors that
• The following taxes are regressive except: A. FICA and self-employment taxes B. federal income tax for individuals C. All of these. D. unemployment taxes
• Although the primary purpose of a tax system is to raise revenue, Congress uses the federal tax system for other purposes as well. Describe the other ways in which Congress uses the federal tax system. Be specific.
• Which of the following statements is incorrect? a. The AMTI is calculated by modifying the regular tax Taxable Income. b.The AMT is a flat-rate alternative to the regular tax. c. Taxpayers may choose to pay either the regular tax or the AMT. d. Only b
• Which of the following payroll taxes is not paid by the employee? A. federal unemployment tax B. federal income tax C. state income tax D. FICA (Social Security and Medicare)
• Which of the following is not an employer payroll cost? (a) FICA taxes. (b) Employer contributions to a retirement plan. (c) Federal and state income taxes. (d) Federal and state unemployment taxes.
• Which of the following statements concerning taxation is accurate? A. Only the owners must pay taxes on corporate income. B. Corporations pay federal income taxes but not state income taxes. C. Corporations pay federal and state income taxes. D. Partn
• Which of the following statements about marginal tax rates is true? a. A taxpayer's marginal rate can change with every transaction. b. As the marginal rate increases, the tax savings of an income-ge
• Which of the following is referred to as net pay? a. Gross pay minus federal and state income taxes. b. Gross pay minus all deductions. c. Take-home pay plus all deductions. d. All deductions plus all with holdings.
• Which of the following statements is true about FICA Social Security and Medicare? A. Employers match the employee's deduction for FICA Medicare but pay a higher percentage for FICA Social Security. B. Only employees have this deduction. C. Only employers
• Which of the following payroll taxes are usually filled and remitted annually? a. Federal unemployment taxes. b. FICA taxes. c. State unemployment taxes. d. Federal and state unemployment taxes.
• If the incremental federal income tax rate is 38% and the incremental state income tax rate is 6%, what is the effective combined income tax rate (t)? If state income taxes are 14% of taxable income,
• Which of the following is not true regarding income tax credits? (a) Tax credits have the ability to protect a larger amount of income from taxation on individuals with lower taxable income than those with higher taxable income. (b) Individual tax credits
• Which of the following have the same monetary after-tax value to all taxpayers: deductions or credits? Explain.
• Which of the following is classified as an accrued payroll liability? a. Federal Income Tax Withheld: yes, Employee's Share of F.I.C.A. Taxes: yes b. Federal Income Tax Withheld: yes, Employee's Share of F.I.C.A. Taxes: no c. Federal Income Tax Withheld:
• Consider the idea of replacing the federal income tax with a national sales tax or value-added tax. Would this make the system more fair or less fair? Give example.
• Explain an income tax topic of your choice. For example, you can explain about tax-free fringe benefits or the sources of tax law authority or the education tax credits, etc.
• Which of the following is not a payroll tax expense to the employer? a. State unemployment taxes. b. Federal unemployment taxes. c. Social Security and Medicare taxes. d. Federal income taxes withheld from employee paychecks.
• Which of the following will cause the reported effective tax rate to differ from the federal statutory tax rate? I. Foreign tax rates that are lower than federal statutory tax rate. II. Tax-exempt income. III. Different depreciation methods for tax and
• Which of the following taxpayers benefit most in terms of dollars saved as a result of tax planning to reduce taxes? (a) An individual taxpayer who has a marginal tax rate of 28 percent (b) An individual taxpayer who has an average tax rate of 28 percent
• Identify the statement below that is not true regarding social security tax. A. Both the employee and the employer pay an equal amount of social security tax on the employee's wages. B. The social security tax provides benefits for retirement as well as
• Which is not a source of federal revenue? a. Employment taxes. b. Estate and gift taxes. c. Sales tax. d. Income taxes and individuals.
• Which of the following entities are never subject to federal tax on its income: A. A tax exempt investor. B. A state government sponsored pension plan that is an integral part of the state. C. An individual who is a real estate professional. D. Only A and
• Which of the following is not an adjustment to income? a. a penalty on early withdrawal from savings b. sales taxes paid c. a portion of the self-employment tax paid by a self-employed taxpayer d. qualifying moving expenses
• Assume a Social Security tax rate of 6.2% is applied to maximum earnings of $118,500 and a Medicare tax rate of 1.45% is applied to all earnings. Calculate the Social Security and Medicare taxes for the following situations: Cumulative payment before curr
• Payroll taxes typically include all of the following except: \\ a. Social Security tax b. Federal excise tax c. Medicare tax d. Federal income tax
• Which of the following is a result of a permanent difference? a. DTA (deferred tax asset). b. DTL (deferred tax liability). c. Effective tax rate equal to the statutory tax rate. d. None of the above.
• What is adjusted gross income (AGI)? a) The taxable income after deductions b) The taxable income before deductions c) The taxpayer's after-tax income d) The amount that is subject to tax.
• Which of the following options correctly completes the sentence? The social security lump-sum election means the taxpayer elects to treat the lump-sum social security benefit as if the benefits: a) F
• Which of the following taxpayers will benefit most in terms of dollars saved as a result of tax planning to reduce taxes? a. An individual taxpayer who has a marginal tax rate of 28 percent. b. An i
• Which statement best describes the concept of the "double taxation" of corporation income? a. Corporate income is subject to two levels of taxation: the regular tax and the alternative minimum tax. b. Corporate income is taxed twice at the corporate level
• With regard to tax burdens, which of the following statements is most accurate? a. Gas taxes are an example of a tax that adheres to the benefits received principal. b. Tolls are an example of a tax that adheres to the ability to pay principal. c. Incom
• Discuss the advisability of having the United States adopt a flat tax system, rather than our present progressive tax system. Our present system has caused significant controversies and contains many
• Which of the following federal taxes does not have a comparable California tax? a. Income tax b. Self-employment tax c. Early distribution penalty on an IRA d. California has a comparable tax on all of the above.
• Which of the following statements regarding FICA taxes is true? A. Low income employees are not required to pay FICA taxes. B. An employee who has two different employers during the year may be enti
• Which of the following is true of the alternative minimum tax? a. The alternative minimum tax is designed to ensure that high-income taxpayers do not pay excessive amounts of income tax. b. For 2015, the alternative minimum tax rates are 20 percent and
• Which of the following statements is correct? a) Under the tax laws as they existed in 2014, a dollar received by an individual taxpayer as interest income is taxed at the same rate as a dollar rece
• Which statement best describes the concept of the double taxation of corporation income? a. Subject to two levels of taxation: regular tax and the alternative minimum tax. b. Corporate income is taxed twice at the corporate level: first when earned and th
• Which of the following is NOT a tax that most people pay? A) Local taxes on property B) Federal taxes on possessions C) Federal taxes on earnings D) State taxes on purchases
• Which of the following statements concerning the exemption phaseout is true? a. The phaseout applies only to taxpayers with a 39.6% marginal income tax rate. b. The phaseout can reduce a taxpayer's exemption amount to zero. c. The phaseout doesn't appl
• Which of the following statements is incorrect? a. If the tentative minimum tax exceeds the regular income tax liability, the AMT is $0. b. The exemption amount increases as AMTI increases. c. The AMT tax rate for an individual taxpayer can be as high
• Progressive taxation: a. is inherently unfair. b. was common in pre-Civil War America. c. is a method of flat taxation with minor modifications. d. none of the above.
• The income tax law established which of the following as a basis for taxation? A) Economic income B) Increase in wealth C) Business income D) Accounting income
• Which one of the following payroll taxes are not withheld from an employee's wages? A. Federal unemployment tax B. State income tax C. FICA tax D. Federal income tax
• Which one of the following payroll taxes is not withheld from the employee's wages because it is not levied on the employee? a. Federal income tax b. Federal unemployment tax c. State income tax d. FICA tax
• Which of the following is NOT true regarding income tax credits? a. The credits have the ability to protect a larger amount of income from taxation on individuals with lower taxable income than those with higher taxable income. b. Individual tax credits a
• Which one of the following payroll taxes is not withheld from an employee's wages because it is not levied on the employee? a. Federal income tax. b. FICA tax c. Federal unemployment tax. d. State income tax.
• "Marginal income tax rates" a) are nearly always lower than effective income tax rates. b) refers to the tax rate or bracket on the first dollar earned. c) refers to the tax rate or bracket on the last dollar earned and in a progressive income tax system,
• Which of the following taxes would not be withheld from an employee's paycheck? a. Medicare taxes. b. Federal unemployment taxes. c. Social Security taxes. d. Federal income taxes.
• Which of the following are included in the employer's payroll taxes? a. SUTA taxes b. FUTA taxes c. social security taxes d. All are included in employer taxes.
• Which of the following taxes is not subject to a maximum amount per employee per year? a. State unemployment tax. b. Medicare tax. c. Federal unemployment tax. d. Social security tax.
• Explain why are taxable social security earnings and medicare earnings be the same amount.
• Which option correctly completes this sentence? The social security lump-sum election means the taxpayer elects the lump sum social security benefit as if the benefits: a) For prior years had been re
• What are employment taxes? What are Social Security taxes and how do these taxes work? Does it make a difference if you are self-employed, or employed by a business? If you are a lender, do you think you may rely on any payroll data to assess business so
• The single biggest federal tax is the: a. excise tax. b. federal income tax. c. estate tax. d. corporate income tax.
• What are the two parts of FICA taxes? A. Medical and Disability B. Social Security and Disability C. Social Security and Medicare D. FUTA and SUTA
• Which of the following is not an additional company expense? a. Charitable contribution from employees. b. Pension benefit costs. c. Employer FICA. d. Unemployment tax.
• Which statement is correct? A) Tax credits reduce tax liability on a dollar-for-dollar basis. B) Tax deductions reduce tax liability on a dollar-for-dollar basis. C) The benefit of a tax credit depends on the taxpayer's marginal tax rate. D) Tax deduction
• Immediate post-World War II income tax policy could accurately be said a) to de-emphasize progressive taxation and promote capital investment by high bracket (marginal rate) taxpayers. b) to decrease government reliance on the income tax. c) to emphasi
• Which of the following is not an objective of the federal income tax law? A) Stimulate private investment. B) Redistribution of wealth. C) Encourage research and development activities. D) Prevent taxpayers from paying a higher percentage of their income
• What are the alternative tax system proposed to replace the current US tax system? What would be the expected impact on the economy, the IRS and other factors?
• Suppose a tax reform bill is enacted that causes the corporate tax rate to change from 34% to 36%. How would this affect an existing deferred tax liability? How would the change be reflected in income?
• Which of the following statements regarding tax credits is true? A) Tax credits reduce taxable income dollar for dollar. B) Tax credits provide a greater tax benefit the greater the taxpayer's marginal tax rate. C) Tax credits reduce taxes payable doll
• Using the table of Progressive Taxes below, compute the taxable income and taxes for the following taxpayers. Which taxpayer has a. the highest nominal tax rate? b. the highest effective tax rate? c.
• Which of the following is correct? a) Social Security tax is employer-paid only. b) Income taxes withheld from employees' paychecks are liabilities of the employer. c) Vacation benefits should be recognized as expenses when employees take a vacation.
• Which of the following is a type of common tax service used in tax research? A) Annotated tax service B) Antiquated tax service C) Analytical tax service D) Technical tax service E) All of the above
• Broadening the income tax base and lowering marginal income tax rates provided the intellectual and political foundations for a) the Revenue Act of 1964. b) the Tax Reform Act of 1969. c) the Tax Reform Act of 1986. d) all of the above.
• Which of the below allowances would have the least amount of taxes withheld for federal income tax purposes? - S-0 - S-3 - S-2 - S-1
• Why tax reforms are needed? A) For public welfare B) To make tax filing simple and easy C) To make everyone accountable D) None of the Above
• Which of the following best describes vertical equity? 1. all taxpayers should pay some taxes on their income 2. as income increases, taxes should increase 3. persons with equal incomes should pay the same amount of taxes 4. a person with capital gain
• Which of the following is not a social objective of the tax law? a. Prohibition of a deduction for illegal bribes, fines, and penalties. b. Creation of tax-favored pension plans. c. A deduction for charitable contributions. d. An exclusion for interest e
• How does the FICA tax compare to the self-employment tax? How are these two taxes similar and how do they differ? Explain using examples.
• Arthur pays tax of $5,000 on taxable income of $50,000 while taxpayer Barbara pays tax of $12,000 on $120,000. The tax is a: a) progressive tax b) proportional tax c) regressive tax d) none of the above
• For which of the following taxes is there no ceiling on the amount of employee annual earnings subject to the tax? a. only FICA tax b. only federal income tax c. only federal unemployment compensation tax d. only state unemployment compensation tax
• The best example of a direct tax is a(n): a. excise tax b. liquor tax c. sales tax d. income tax
• What are the taxes paid in 2014? Assume the firm pays equal to 35% of taxable income.
• Which of the following taxes would be deducted in determining an employee's net pay? a. FUTA taxes b. SUTA taxes c. FICA taxes d. all of the above
• Which one is not correct in the context of tax accounting? a. Corporate income tax is an expense, not a distribution of the profits to the government. b. Deferred tax assets might be resulted from loss carryback. c. Non-taxable expense causes permanent