Accounting Final pt 1

also called "Head Tax" during the wars; Form Examples are 1040, 1040A, 1040EZ; Coporate Income Tax, Partnerships Income Tax, Individual Income Tax

buying goods outside of state, you have to pay a use tax

real estate (realty), based on teh value of the property, also known as "Ad Valorem" Latin for based on value; is also called personal property tax in some states (personalty)

also known as employment taxes

• A tax on the value of the estate left behind upon your death; federal tax; employer costs-
• examples are
• 1 social security (6.2% of gross pay) and 2 Medicare (1.45% of gross pay) which equals 7.65% taxes outo f yoru pocket; 3 state unemployment (.25% to 5.4%) and 4 federal unemployment (8% of 1st 7,000)

imposed by the state

federal + state; imposed on gas, alcohol, tobacco

• 1. Primary: to raise revenue for the government
• 2. Secondary:
• a. Social:
• Example: donations to church
• $10,000
• x 25% tax rate
• $2,500 tax savings
• $7,500 after-tax
• b. Economic: changes in taxes laws to effect oil and gas industries

• Gross Income: tangible items (those things that are taxable)
• Taxable NotTaxable
• Salaries Gifts
• Rewards Inheritance

• - Form 1040 – what we use now, called the “Long Form” the summary form
• Form 1040EZ and 1040A – shorter versions
• the schedules provide the details for the 1040 and the other forms provide the details of the schedules

• attached to return if have itemized deductions instead of scheduler deductions
• use standardized deductions when is more than $5,000 if single and $10,000 if married

• if interest and/or dividends are greater than $1,000 must attach -
• Merrill Lynch: 1099-Int

• - is used by those who are self-employed
• is like income statement “self-propriorship”

• is for capital gains and capital losses
• - sale of capital assets (stocks, bonds, land , other properties)
• - selling price – tax basis = if pos. is a gain and if neg. is a loss
• - 1099-B tells how much sold it for, must keep records for what paid

• - miscellaneous income from – used to report other misc.
• - ex. Partnership Income (K-1) – the partners pay the
• income on the partnership income ex. Royalties, Rental Income, Trust Fund, Estate

• - household employment taxes
• - if have maid, sitter, gardeners, etc must pay employment taxes on them (report wages pay them and taxes withheld)

• - supports Schedule A
• - “Employee Business Expenses” – incur expenses that your business does not reimburse you for are allowed to deduct 45 cents per business mile

• - child and dependent care credit
• - ex. daycare – are allowed to claim $3,000 for one child and $6,000 for two or more children – claim a tax credit or tax savings
• - ex. summer camps
• - eligible only if both parents are working

• - gives you extension to file taxes in Oct. 15 instead of Aug 15
• - must give explanation of why

for those who are deducting depreciation

• gives you extension to file taxes in August 15 instead of April 15
• - don’t have to give an explanation “automatic”

1040 and Schedule A and B

- False – Form 2441