Chapter 2 Income, Benefits, and Taxes

Slide 2 What Is Unearned Income? 2-2 Unearned Income and Benefits Earned IncomeUnearned IncomeVariable Income Salaries and wagesInterestBusiness profits TipsDividendsRents CommissionsCapital gainsRoyalties BonusesGambling winningsFarm Income Professional feesAlimony Social security benefits Pensions Annuities Unemployment compensation

Slide 3 What Type of Taxes Do You Pay? 2-2 Unearned Income and Benefits Taxes are based on consumption, income, and wealth. Direct taxes are paid directly to the government. o Examples: income and property taxes Indirect taxes are charged on goods or services bought by the consumer. o Examples: use, excise, and sales taxes

Slide 4 How Do You Benefit from Paying Taxes? Direct benefits o Examples: social security, police, national parks 2-2 Unearned Income and Benefits Indirect benefits o Examples: public education for citizens, free vaccines

Slide 5 Building Communications Skills 2-2 Unearned Income and Benefits Critical Listening Evaluate the information you hear. Consider only important or relevant information. Make good decisions based on what is accurate and useful.

Slide 6 Focus On... Social Security Benefits 2-2 Unearned Income and Benefits Workers pay into the social security fund through payroll deductions. A social security number is assigned to each person. Employers match the payments. Upon retirement, workers receive a monthly benefit check.