Understanding Taxes Worksheet
Resources: The United Stated Internal Revenue Service at www.IRS.gov
Directions Use the links provided for each tax form to answer the corresponding questions in at least 50 words each.
Understanding the 1040 Form
Visit the 1040A Form at https://www.irs.gov/pub/irs-pdf/f1040a.pdf
1. Compare and contrast the 1040, 1040A, and 1040EZ forms. Which form would a single student use? If the student was married with children which form would most likely be used?
2. If a person is single and the head of household, why would he or she be able to file "head of household?" Are there any benefits from filing as head of household, rather than single?
3. Define capital gains. What impact can they have on a refund or payment of taxes?
4. What is adjusted gross income? On which line on the tax form is total income located?
5. On what lines are student loan interest deductions and tuition and fees located on the 1040A form? What form is used to help with a student's tuition and fees?
6. What is a tax credit and tax deduction? Explain.
7. When would a person use third party designees?
Visit the W-2 Wage and Tax Form at https://www.irs.gov/pub/irs-pdf/fw2.pdf.
8. What is the primary purpose of the W-2 Wage and Tax Forms?
9. When does a taxpayer receive the W-2? Who will provide this form to the taxpayer?
10. What items on the W-2 make up the Federal Insurance Contributions Act or FICA?
11. What form should accompany the W-2 for Child and Dependent Care Expense? This will be a two-word answer.
12. What is the date that taxes are due? If you need an extension what form would you use? How long is the extension? Are there any penalties for requesting an extension?