H&R Block Ch. 1&2 Questions And
Answer With Verified Solutions Already
Passed (GRADED A+)
Wage
Answer: Compensation, usually in the form of money, received by
employees in exchange for their work.
Adjusted Gross Income (AGI)
Answer: The total gross income minus allowable reductions, regardless of
itemized deductions.
Credits
Answer: Tax reductions provided for specific purposes, available to
qualifying taxpayers. Some are refundable, while others are not. Some
credits may also be carried forward.
Refundable Credits
Answer: Credits where any excess over the tax liability is refunded by the
IRS.
Non-refundable Credits
Answer: Credits that reduce the tax liability to zero but cannot provide a
refund.
Earned Income
Answer: Income generated from personal work, such as wages, tips,
bonuses, and self-employment income, in contrast to income from property
or investments.
Exemption
Answer: A deduction from taxable income, such as the $3,650 exemption
allowed in 2009.
Federal Income Tax Withheld
, Answer: The portion of income withheld by an employer to prepay federal
taxes on behalf of the employee.
Gross Income
Answer: The total income received by a taxpayer, from all sources,
including money, property, or services, that is subject to tax.
Income
Answer: The gain obtained from capital, labor, or both, typically used
within terms like gross income, taxable income, and adjusted gross income.
Medicare Part A
Answer: The tax deducted from wages or self-employment income for
Medicare, typically 1.45% for employees and 2.9% for self-employed
individuals.
Social Security Tax Withheld
Answer: The employee’s portion of Social Security tax, withheld by the
employer, and submitted to the IRS.
Social Security Wages
Answer: The total wages paid to an employee that are subject to Social
Security tax, excluding tips.
Tax Liability
Answer: The total amount of tax owed to the IRS after accounting for any
credits but before considering any prepayments, like withholdings.
Taxable Income
Answer: The amount of income that is taxable after deductions, exemptions,
and adjustments are applied.
Unearned Income
Answer: Income from investments, like interest, dividends, and royalties, or
other sources not related to personal services, such as pensions or
unemployment compensation.
Resident Alien
Answer With Verified Solutions Already
Passed (GRADED A+)
Wage
Answer: Compensation, usually in the form of money, received by
employees in exchange for their work.
Adjusted Gross Income (AGI)
Answer: The total gross income minus allowable reductions, regardless of
itemized deductions.
Credits
Answer: Tax reductions provided for specific purposes, available to
qualifying taxpayers. Some are refundable, while others are not. Some
credits may also be carried forward.
Refundable Credits
Answer: Credits where any excess over the tax liability is refunded by the
IRS.
Non-refundable Credits
Answer: Credits that reduce the tax liability to zero but cannot provide a
refund.
Earned Income
Answer: Income generated from personal work, such as wages, tips,
bonuses, and self-employment income, in contrast to income from property
or investments.
Exemption
Answer: A deduction from taxable income, such as the $3,650 exemption
allowed in 2009.
Federal Income Tax Withheld
, Answer: The portion of income withheld by an employer to prepay federal
taxes on behalf of the employee.
Gross Income
Answer: The total income received by a taxpayer, from all sources,
including money, property, or services, that is subject to tax.
Income
Answer: The gain obtained from capital, labor, or both, typically used
within terms like gross income, taxable income, and adjusted gross income.
Medicare Part A
Answer: The tax deducted from wages or self-employment income for
Medicare, typically 1.45% for employees and 2.9% for self-employed
individuals.
Social Security Tax Withheld
Answer: The employee’s portion of Social Security tax, withheld by the
employer, and submitted to the IRS.
Social Security Wages
Answer: The total wages paid to an employee that are subject to Social
Security tax, excluding tips.
Tax Liability
Answer: The total amount of tax owed to the IRS after accounting for any
credits but before considering any prepayments, like withholdings.
Taxable Income
Answer: The amount of income that is taxable after deductions, exemptions,
and adjustments are applied.
Unearned Income
Answer: Income from investments, like interest, dividends, and royalties, or
other sources not related to personal services, such as pensions or
unemployment compensation.
Resident Alien
