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Personal Finance: Tax Planning and Strategies
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The basic methods of tax planning are: reducing your overall income, increasing your number of tax deductions throughout the year, and taking advantage of certain tax credits.
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Personal Finance: Tax Planning and Strategies
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25 Questions

1. Craig Ripley sold his stock in Gandy Corporation for a price less than what he paid for it- Craig will experience
2. The percentage of the last dollar you earn that goes toward your taxes is your
3. If you are an unmarried taxpayer, with at least one child or dependent living with you, your filing status should be
4. Which of the following would offset your tax liability in a direct dollar for dollar manner and may actually increase your tax refund beyond the amount paid during the tax year?
5. Free File is configured in a way that allows ________ of U.S- taxpayers who are eligible to use it.
6. If you're in the 15% marginal tax bracket, what is the equivalent taxable yield on an 8% municipal bond?
7. A source of tax-free income is
8. Which indicates the correct order for completing your tax returns?
9. You wish to make a charitable contribution of $2,000 to a qualified organization- You are currently in the 28 percent marginal tax bracket- By how much would this contribution lower your tax bill assuming your other itemized deductions exceed the standard deduction?
10. Understanding how tax planning affects your personal finances is actually important for most taxpayers, not just the wealthy, because
11. Income on which the payment of taxes is postponed until some future date is called
12. If you are in a 25 percent tax bracket then every dollar of your adjusted gross income will be taxed at 25 percent.
13. The Federal Insurance Contributions Act (FICA) tax deducted from your salary goes to pay for unemployment insurance.
14. Taxes are collected on a pay-as-you-go basis.
15. Standard deductions need yearlong record-keeping and thorough and accurate documentation.
16. A tax system in which tax rates increase as income increases is called a(n) ________ system.
17. A child tax credit reduces the federal income tax you owe by up to $1,000 for each qualifying child under the age of
18. According to the Tax Policy Center, approximately ________ of American households did not pay any federal income taxes in the 2013 tax year.
19. Which of the following is a source of tax-free income?
20. In 2010 you purchased a share of stock for $125 and you sold it this year for $250- Legally, you don't need to pay any taxes on this transaction.
21. Assets you own, including such items as stocks, bonds, or real estate, are commonly termed
22. The movement into a higher tax bracket as a result of inflation increasing wages is called
23. Tax credits reduce your taxes on a dollar-for-dollar basis.
24. Your dependent is claimed as an approved exemption on ________ tax return.
25. When considering a principal residence as a tax shelter, remember that you can

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