Federal Income Tax Chapter 7 Questions
and Answers Rated A+
A tax that increases in proportion to increases in income is known as a(n)
_____________ tax. - ANSWER-progressive
A taxpayer's filing status is unrelated to his or her marital status. - ANSWER-False
A type of tax for which the rate stays the same regardless of income is called -
ANSWER-proportional tax
A(n) __________ tax allows a higher-income person to pay a lower percentage of
income in taxes than a lower-income person. - ANSWER-regressive
A(n) ___________ is an amount subtracted directly from tax owed. - ANSWER-tax
credit
Alimony is taxable to the person receiving it and is ductile to the one paying it. -
ANSWER-True
An administrative agency of the federal government that collects taxes and enforces tax
laws is the ___________. - ANSWER-IRS
An amount that can be subtracted from your income for each person who depends on
your income to live is a(n) ____________. - ANSWER-exemption
An examination of tax returns by the IRS is called a(n) ____________. - ANSWER-audit
As an alternative to itemizing deductions, taxpayers may - ANSWER-claim the standard
deduction
Expenses that can be subtracted from gross income are called ___________. -
ANSWER-deductions
For people who use Form 1040EZ or 1040A, the IRS allows - ANSWER-electronic filing
of tax returns and electronic payment of taxes due
In order to avoid itemizing deductions, a person may elect to take the __________,
which is a flat amount. - ANSWER-standard deduction
Money collected by the government from various sources is known as __________. -
ANSWER-revenue
and Answers Rated A+
A tax that increases in proportion to increases in income is known as a(n)
_____________ tax. - ANSWER-progressive
A taxpayer's filing status is unrelated to his or her marital status. - ANSWER-False
A type of tax for which the rate stays the same regardless of income is called -
ANSWER-proportional tax
A(n) __________ tax allows a higher-income person to pay a lower percentage of
income in taxes than a lower-income person. - ANSWER-regressive
A(n) ___________ is an amount subtracted directly from tax owed. - ANSWER-tax
credit
Alimony is taxable to the person receiving it and is ductile to the one paying it. -
ANSWER-True
An administrative agency of the federal government that collects taxes and enforces tax
laws is the ___________. - ANSWER-IRS
An amount that can be subtracted from your income for each person who depends on
your income to live is a(n) ____________. - ANSWER-exemption
An examination of tax returns by the IRS is called a(n) ____________. - ANSWER-audit
As an alternative to itemizing deductions, taxpayers may - ANSWER-claim the standard
deduction
Expenses that can be subtracted from gross income are called ___________. -
ANSWER-deductions
For people who use Form 1040EZ or 1040A, the IRS allows - ANSWER-electronic filing
of tax returns and electronic payment of taxes due
In order to avoid itemizing deductions, a person may elect to take the __________,
which is a flat amount. - ANSWER-standard deduction
Money collected by the government from various sources is known as __________. -
ANSWER-revenue
