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PayrollandTaxesWorkshop

Name:Thane

Period:6th

PartI:Vocabterms(defineeach):
GrossPay:
Totalamountmadebeforetaxes
NetPay
Totalamountmadeaftertaxesanddeductions
YTD
Yeartodate
Deductions
Reductionsfrompayoftaxablepay
Allowances
Amountofmoneypermittedwithinasetregulationsorrules
Withholdings
TheamountofmoneytakenfromyourincomeforIRS
SocialSecurity
Afederalinsuranceprogramthatprovidesbenefitstoretired,unemployed,ordisabledpeople
Cafeteriaplan
abenefitprovidedbyanemployerwhichallowsanemployeetocontributeacertainamountof
hisorhergrossincometoadesignated"account"beforetaxes
Asset
CapitalGains
aprofitfromthesaleofproperty
Privatecontractor
isanaturalperson,business,orcorporationthatprovidesgoodsorservicestoanotherentity
undertermsspecifiedinacontractorwithinaverbalagreement

Basedonfederal
taxbrackets
,howmuchtaxdoessomeoneoweontaxableincomeof
$309,741?Showyourwork
.
309,741
189,301=120,440
120,440/00.33=364969.69

PayrollandTaxesWorkshop
Name:Thane

Period:6th

PartII:Payroll
Jobtitle
:Cook
Hourlywage/salary
:$30
Hoursperweek
:40

Frequencyofpaychecks
:2weeks
Numberofpaychecksperyear
:26

Whatmandatorywithholdingswillappearonyourpaycheck
?

1. FederalWithholdingTax
2. SocialSecurityTax
3. MedicareTax
4. StateTax

Whatotherpayrolldeductionswouldyouliketakenoutofyourpaycheck
?
Chooseatleast2
.

RetirementFund
FSA

Simulatedpaystub
:
Besuretoaccountforyournumberofallowances

Employer:McDonalds

Employee:Sir.ThaneMcGrath

HrWage:$30.00
HrperWeek:40
GrossIncome:$2400.00

Medicare:430.34
SSTax:100.64
CoStIncomeTax:28291.02
FedIncomeTax:6687.25
Total:

Assumingeachpaycheckisthesame,createaW2showingendofyearreporting
:

PayrollandTaxesWorkshop
Name:Thane

Period:6th

PayrollandTaxesWorkshop
Name:Thane

Period:6th

Whatarethetotalcontributionstoyourretirementandcafeteriaaccounts?Rememberto
includeemployermatchtoanIRA
.

PayrollandTaxesWorkshop
Name:Thane

Period:6th

$100.64

PartII:OtherIncome
Respondtoeachofthesewithacompletesentence.

CapitalGainsTax
Identifytwoassets(house,collectorsitem,stock,property,gold,patents,jewelry,etc.)
Declareoneofthemasashorttermgain,theotherasalongtermgain
.

Myhouseisalongtermassetpricedat$50,000andmygrandfather'sgoldwatchisashort
termassetpricedat$1000.

1099income
Createasourceof1099incomeforyourself,includingsourceanddollaramount.Thisis
yourscheduleCtotal
.

Sellingartwork,made$500

Itemizeddeductions
Listatleastthreeitemizeddeductions,includingdollaramount.ThisisyourScheduleA
total
.

PartIII:Filingform1040
Completeapapercopyoftaxform
1040
.Scanitinorturninthepapercopy.
Papercopy

PayrollandTaxesWorkshop
Name:Thane

Period:6th

PartIV:Analysis
Whatisthedifferencebetweenataxdeductionandataxcredit
?

Taxcreditsprovideareductionofyourincometaxliability.Taxdeductionsloweryour
monthlyincome.

Howmuchmoneycanyoumakeasan
independent
adultandnotpayincometax
?

$0

HowdoesthenumberofW4allowancesaffectpayrollandyourtaxreturn
?
ThemoreW4allowancesyouhavethemoreyouwillgetbackattheendoftheyear.

Vanessahasbuiltanewcompanyandherstocksharesarenowvalued$1.2million.
Doesshepaytaxonthatgrowth
?

Theymaynotpayonthatgrowthbutthereisataxondividends.

Ititeverbeneficialtomakelessmoneyandmoveintoalowertaxbracket
?

Yesbecausedependingonhowmuchmoneyyoumade.

Whatissomethingelseyoulearnedfromthisproject
?

Taxesareanecessaryevilbecauseasmuchastheyareannoyingtheyareimportanttomylife.

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