WGU C237 Taxation I Review for Final Exam 67
Questions with Verified Answers
The U.S. Federal Income Tax System is:
A) Regressive tax rate structure
B) Progressive tax rate structure
C)Proportional tax rate structure
D)Possessive tax rate structure - CORRECT ANSWER B) Progressive tax rate
structure
U.S. Federal and State Income Taxes use a progressive tax rate structure.
Progressive tax rate structures increase the ______________ as the tax base
increases. - CORRECT ANSWER marginal tax rate
_______________structures decrease the marginal tax rate as the tax bases
increases. - CORRECT ANSWER Regressive tax rate
Our Social Security Tax and federal and state unemployment taxes
are____________. Ex. Social Security is capped at $135,200 in 2018. You will be
taxed up to that income, any money you make over that amount will not be taxed.
- CORRECT ANSWER Regressive
__________ structure is also known as a flat tax. It is a constant tax rate
throughout the tax base. Sales taxes and excise taxes are examples of a
proportional tax. - CORRECT ANSWER Proportional Tax rate
,The 16th amendment established that congress has the power to lay and collect
taxes on incomes, from whatever source derived, without apportionment among
the several States, and without regard to any census or enumeration. The
amendment was ratified in:
A) 1861
B) 1892
C) 1909
D) 1913 - CORRECT ANSWER D) 1913
Currently using _____ Tax Code (last major overhaul)- (previous overhauls were
1939, 1954) - CORRECT ANSWER 1986
Tax law codified US Code Title __ - CORRECT ANSWER 26
Judging the _______________ of a tax system means assessing the amount of the
tax revenues it must generate to pay governmental expenditures.
A) Sufficiency
B) Equity
C) Certainty
D) Convenience
E) Economy - CORRECT ANSWER A) Sufficiency
, How tax burden should be distributed across taxpayers. - CORRECT ANSWER
Equity
Taxpayer should be able to determine when to pay taxes, where to pay taxes, and
how to determine taxes. - CORRECT ANSWER Certainty
System should be designed to collect tax revenue without undue hardship on the
taxpayer. Ex. Collecting from wages as earned, or sales tax when purchasing item -
CORRECT ANSWER Convenience
Compliance cost should be reasonable - CORRECT ANSWER Economy
What is the Old Age, Survivors, and Disability Insurance (OASDI) tax rate to an
employee?
A) 12.4%
B) 2.9%
C) 6.2%
D) 6.0% - CORRECT ANSWER C) 6.2%
Old Age, Survivors, and Disability Insurance (OASDI) Tax is social security tax. The
rate for the tax is ______. 6.2% is paid by the employee from their paycheck the
other 6.2% is paid by the employer. There is a cap on how much income you are
taxed on, tax is capped at $135,200 for 2018. This is a regressive Tax. - CORRECT
ANSWER 12.4%
Questions with Verified Answers
The U.S. Federal Income Tax System is:
A) Regressive tax rate structure
B) Progressive tax rate structure
C)Proportional tax rate structure
D)Possessive tax rate structure - CORRECT ANSWER B) Progressive tax rate
structure
U.S. Federal and State Income Taxes use a progressive tax rate structure.
Progressive tax rate structures increase the ______________ as the tax base
increases. - CORRECT ANSWER marginal tax rate
_______________structures decrease the marginal tax rate as the tax bases
increases. - CORRECT ANSWER Regressive tax rate
Our Social Security Tax and federal and state unemployment taxes
are____________. Ex. Social Security is capped at $135,200 in 2018. You will be
taxed up to that income, any money you make over that amount will not be taxed.
- CORRECT ANSWER Regressive
__________ structure is also known as a flat tax. It is a constant tax rate
throughout the tax base. Sales taxes and excise taxes are examples of a
proportional tax. - CORRECT ANSWER Proportional Tax rate
,The 16th amendment established that congress has the power to lay and collect
taxes on incomes, from whatever source derived, without apportionment among
the several States, and without regard to any census or enumeration. The
amendment was ratified in:
A) 1861
B) 1892
C) 1909
D) 1913 - CORRECT ANSWER D) 1913
Currently using _____ Tax Code (last major overhaul)- (previous overhauls were
1939, 1954) - CORRECT ANSWER 1986
Tax law codified US Code Title __ - CORRECT ANSWER 26
Judging the _______________ of a tax system means assessing the amount of the
tax revenues it must generate to pay governmental expenditures.
A) Sufficiency
B) Equity
C) Certainty
D) Convenience
E) Economy - CORRECT ANSWER A) Sufficiency
, How tax burden should be distributed across taxpayers. - CORRECT ANSWER
Equity
Taxpayer should be able to determine when to pay taxes, where to pay taxes, and
how to determine taxes. - CORRECT ANSWER Certainty
System should be designed to collect tax revenue without undue hardship on the
taxpayer. Ex. Collecting from wages as earned, or sales tax when purchasing item -
CORRECT ANSWER Convenience
Compliance cost should be reasonable - CORRECT ANSWER Economy
What is the Old Age, Survivors, and Disability Insurance (OASDI) tax rate to an
employee?
A) 12.4%
B) 2.9%
C) 6.2%
D) 6.0% - CORRECT ANSWER C) 6.2%
Old Age, Survivors, and Disability Insurance (OASDI) Tax is social security tax. The
rate for the tax is ______. 6.2% is paid by the employee from their paycheck the
other 6.2% is paid by the employer. There is a cap on how much income you are
taxed on, tax is capped at $135,200 for 2018. This is a regressive Tax. - CORRECT
ANSWER 12.4%
