1. Personal Finance
Day18

2. Learning Objectives Answer questions on 1040EZ
Definitions related to Tax forms and Filing

3. Tax Terms
Earned income--- money received for personal effort, such as wages, salary, commission, fees, tips or bonuses
Line one of the 1040EZ or Box 1 of the W-2
Adjusted Gross Income --- gross income reduced by certain adjustments, such as contributions to a retirement account or alimony payments
Line 4 of the 1040EZ
Tax Deduction--- an amount subtracted from adjusted gross income to arrive at taxable income
Line 5 of the 10401EZ

4. Tax Terms
Taxable Income --- The net amount of income, after allowable deductions, on which income tax is computed
Line 6 of the 1040EZ
Tax Credit--- an amount subtracted directly from the amount of taxes owed
Line 8 of the 1040EZ

5. Tax Terms
Tax avoidance--- the use of legitimate methods to reduce your taxes
Tax Evasion--- the use of illegal methods to reduce your taxes

6. Work time Study the 1040EZ --- Test Tuesday
Make sure you ask questions if you don’t know where the numbers come from or what to do with them
Chapter 4 review --- Test on Wednesday
Seven topics assignment