FICEP Study Guide (Final) QUESTIONS AND ANSWERS 100% ACCURATE

FICEP Study Guide (Final) QUESTIONS AND ANSWERS 100% ACCURATE operating costs A tax is defined as a contribution that supports the _____ of a government. progressive A _____ tax requires a taxpayer to pay more tax as their income increases. (Federal and state income taxes are examples) regressive A _____ tax charges the same percentage of the cost of a good or service, no matter what the taxpayer earns. (Sales tax, gas taxes, and liquor taxes are examples) fees or surcharges Sometimes taxes are called _____. fee A _____ could include the cost of a driver's license or a hunting license. surcharge A _____ could be a gasoline tax, tobacco tax, or liquor tax. tax obligations Taking care of _____ is as important for a member's financial well-being as it is to pay their bills on time. correspondence Any _____ from the IRS should be reviewed and dealt with as soon as possible. taxpayer advocate service. If you have not been able to resolve a problem with the IRS, seek assistance from the _____. tax professional Complex tax situations might require members to hire a _____. 70 _____% of taxpayers may be eligible for free tax filing assistance. filing status If members get a large refund, they might want to change their _____ if the money is needed in their monthly budget. costly Caution members that using refund anticipation loans can be a _____ way to get instant access to their refund. pay down debt The first choice for using a tax refund is to _____. self-employment quarterly taxes Other tax authorities that members must pay attention to are state income tax, property tax, and _____. taxable income Examples of _____ are wages, salaries and tips, interest income, alimony, business income, capital gains, pensions and annuities, other forms of income, and distributions from a traditional IRA. non-taxable income Examples of ____ are child support payments, life insurance benefits paid to a beneficiary, gifts and inheritances from parents, social security benefits, benefits from welfare, and qualified distributions from roth IRAs. filing status _____ can make a difference in the taxes paid. filing status Examples of _____ are single, married filing jointly, married filing separately, head of household, and qualified widow or widower with dependent children. 401(k) plan Saving for retirement can also save taxes by making contributions to a _____. traditional IRA If a person is in a 25% income bracket, they could save 25% of the money they deposit into a _____. insurance Financial counseling clients can manage some of the risks in life by having the right types and amounts of _____. insurable interest An _____ in a car you financed at the credit union could be held by both you and the credit union. risks You can make a better choice about insurance coverage if you evaluate your _____. umbrella liability policy An _____ can give you protection if someone sues you for an accident on your property. deductibles and policy limits _____ can help manage the costs of insurance. cobra _____ provides the right for an employee that is terminated or resigns to keep their medical insurance for 18 months if they pay the cost (full amount of the premium).