Ficep Final: CUNA Review Questions And Answers | Complete Solution Graded A+ Select the statement that correctly describes a progressive tax. A progressive tax requires people to pay more as they earn more. Pick the statement that best describes a regressive tax. A regressive tax charges the same t...
Ficep Final CUNA Review Questions And Answers |
Complete Solution Graded A+
Select the statement that correctly describes a progressive tax. - ANS-A progressive tax
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g requires people to pay more as they earn more.
g g g g g g g g
Pick the statement that best describes a regressive tax. - ANS-A regressive tax charges the
g g g g g g g g g g g g g g
g same tax rate regardless of the taxpayer's income.
g g g g g g g
Why are government fees and surcharges sometimes described as a form of tax? - ANS-
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Because they generate income for the government.
g g g g g g
Which taxing authorities are worthy of the member's attention? - ANS-The member must
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g attend to all tax authorities at all levels of government to maintain their financial well-
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being.
,How do taxes impact your personal spending? - ANS-Taxes can make personal spending go
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g up or down.
g g
Which is larger: the penalty for failing to pay federal income taxes on time, or the penalty
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g for failing to file a tax return when taxes are owed? - ANS-The penalty for failing to file a
g g g g g g g g g g g g g g g g g g
g tax return is significantly higher.
g g g g
What is the right attitude to take toward taxes to protect your financial well-being? - ANS-
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Taxes are an essential financial responsibility.
g g g g g
When is the IRS most likely to impose the maximum penalty on taxpayers? - ANS-When
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g they are forced to track down the taxpayer.
g g g g g g g
What is a good rule to follow when dealing with a tax auditor or another issue involving
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g the IRS? - ANS-Never assume the IRS is always correct.
g g g g g g g g g
What is the financial counselor's role in aiding members with complex tax issues? - ANS-
g g g g g g g g g g g g g g
The counselor provides basic information and refers members to tax programs or tax
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g experts.
,What happens when taxpayers who file a late return for any or all of the 4 most recent tax
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g years are owed a refund? - ANS-No penalty is charged and the taxpayer gets the full refund
g g g g g g g g g g g g g g g g
g amount.
What tax services are provided by the Volunteer Income Tax Assistance (VITA) program? -
g g g g g g g g g g g g g
g ANS-Free tax return assistance to low- or moderate-income taxpayers.
g g g g g g g g
What benefit is offered when VITA services are combined with credit union programs that
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g encourage taxpayers to open accounts for direct deposit of tax refunds? - ANS-Direct
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g deposit reduces the time required to get a refund, which counters the appeal of refund
g g g g g g g g g g g g g g
g anticipation loans. g
What is the name of the organization that offers free tax assistance to taxpayers age 60 or
g g g g g g g g g g g g g g g g
g older, those with disabilities or special needs, or who qualify for earned income or
g g g g g g g g g g g g g
g homestead tax credits? - ANS-Tax Counseling for the Elderly (TCE)
g g g g g g g g g
What percent of tax payers are eligible to use the "Free File Online" service offered as a
g g g g g g g g g g g g g g g g
g partnership between the IRS and tax software companies? - ANS-70% are eligible
g g g g g g g g g g g
, When members use tax refunds to pay down debts, which debts should be paid first? -
g g g g g g g g g g g g g g g
g ANS-Always pay the debts with high interest rates or that could prompt garnishments.
g g g g g g g g g g g g
How have education, information, and direct deposit programs impacted taxpayers' use of
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g refund anticipation loans? - ANS-The use of refund anticipation loans is decreasing.
g g g g g g g g g g g
What rule of thumb should be used when defining taxable income? - ANS-If you benefit
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g financially, you are likely to be taxed for it.
g g g g g g g g
Which type of qualified IRA withdrawal is exempt from income tax? - ANS-Roth IRA
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g withdrawals are exempt. g g
How do different tax authorities treat items excluded from federal taxable income? - ANS-
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Exclusions vary from state to state.g g g g g
What is the first step for effectively managing income taxes? - ANS-Determining your filing
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g status.
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