Different Types of Taxes (Business Information)

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--written by thewriter197
--employed by Ashford University




Chapter 1 Discussion Question 6
What is the definition of tax base, and how does it affect the amount of tax levied?

    The total amount of assets or money made that can be taxed by tax authority. The base tax is used for letting the tax authority know how much to charge someone for taxes. Now, tax levied is a tax to satisfy all liabilities. So, a higher tax base would mean a higher levied amount. Assets are connected to liabilities. Some of your assets is borrowed and some of it is on land owned by the government. You are going to pay taxes one way or another. The government can take more to satisfy the liability as your tax bill goes up.

Chapter 1 Discussion Question 9
Explain what is meant by regressive tax.  Why is the social security tax considered a regressive tax?

Taking income from low income earners is called regressive tax. It supports the low earners at the bottom and helps pay for retirement. Most people at the bottom need social security because they are the ones that work for the people at the top.

Chapter 1 Discussion Question 10
Define and compare these terms: average tax rate and marginal tax rate.

Average tax rate is percentages divided by taxable income. Marginal tax rate is rate of tax on an additional dollar. The amount increases as a person makes more money. These terms are similar because they require a person to pay taxes for making money. They are different because one is based on percentages and the other is based on single dollar amount.

Chapter 2 Discussion Question 3
What qualifications are necessary to file as head of household?

"To file as head of household, you must: Pay for more than half of the household expenses. Be considered unmarried for the tax year, and. You must have a qualifying child or dependent (2018)."

Chapter 2 Discussion Question 6
What are the three general tests that a qualifying person must meet to be a dependent of the taxpayer?

They must first pass a dependent payer test. The person must also pass a citizen or resident test. They must also pass a joint return test. These are the three tests a person needs to pass in order to be a dependent of a tax payer.

Chapter 2 Discussion Question 9
What are the four specific tests necessary to be a qualifying relative of the taxpayer?

The four tests are support Test, gross income test, not  a qualify child test, and relationship or member of a household test.

Chapter 2 Discussion Question 10
What is a multiple support agreement, and what is its purpose?
An agreement that means that multiple people support someone and no on supports the same person for %50 support. This agreement is to find out who supports the child or person the most. Agreement is suppose to be made in written form.



References:

(2018). Guide to Filing Taxes as Head of Household. Retrieved from URL: https://turbotax.intuit.com/tax-tips/family/guide-to-filing-taxes-as-head-of-household/L4Nx6DYu9 (Links to an external site.)Links to an external site..
Cruz, A., Deschamps, M., Niswander, F., Prendergast, D., & Schisler, D. (2017). Fundamentals of taxation 2017. Retrieved from https://vitalsource.com