1. A tax is a payment or charge that citizens owe to the government.
2. Taxes are collected by the government to fund public services and infrastructure.
3. A progressive tax system means that individuals with higher incomes pay a larger percentage of their income in taxes.
4. A regressive tax system means that individuals with lower incomes pay a larger percentage of their income in taxes.
5. An example of a progressive tax is the federal income tax.
6. An example of a regressive tax is the sales tax.
7. The purpose of taxation is to generate revenue for the government to provide public goods and services.
8. A flat tax system applies the same tax rate to all income levels.
9. Tax evasion is the illegal non-payment or underpayment of taxes.
10. Tax avoidance is the legal use of tax laws to reduce one’s tax liability.
11. The IRS (Internal Revenue Service) is responsible for collecting federal taxes in the United States.
12. Property taxes are typically used to fund local services such as schools and police departments.
13. Payroll taxes fund Social Security and Medicare programs.
14. Excise taxes are levied on specific goods like gasoline, tobacco, and alcohol.
15. The Laffer Curve illustrates the relationship between tax rates and tax revenue.
16. A tax credit reduces the amount of tax owed dollar-for-dollar.
17. A tax deduction reduces taxable income, which lowers the tax owed based on the taxpayer’s tax bracket.
18. The U.S. Constitution grants Congress the power to levy taxes.
19. State governments may impose their own income taxes in addition to federal taxes.
20. Local governments often rely on property taxes as a primary source of revenue.
Parent Tip: Review the logic above to help your child master the concept of types of force worksheet.
