1. What items must be included in your notebook ? What items must be included in your notebook ? When is the notebook due? When is the notebook due? When is your homework due When is your homework due If you are absent on the day of a test, how long do you have to make it up? If you are absent on the day of a test, how long do you have to make it up? What must be on warm up and notes papers? What must be on warm up and notes papers? What must be on homework papers? What must be on homework papers? Tests account for what % of your total grade? Tests account for what % of your total grade? When can you use electronic devices? When can you use electronic devices? What is the most important change that needs to be made? What is the most important change that needs to be made?

2. 2.1 Federal Income Tax, Slide 2 of 43 TIMES UP

3. What items must be included in your notebook ? What items must be included in your notebook ? When is the notebook due? When is the notebook due? When is your homework due When is your homework due If you are absent on the day of a test, how long do you have to make it up? If you are absent on the day of a test, how long do you have to make it up? What must be on warm up and notes papers? What must be on warm up and notes papers? What must be on homework papers? What must be on homework papers? Tests account for what % of your total grade? Tests account for what % of your total grade? When can you use electronic devices? When can you use electronic devices? What is the most important change that needs to be made? What is the most important change that needs to be made?

4. 2.1 Federal Income Tax, Slide 4 of 43

5. 2.1 Federal Income Tax, Slide 5 of 43

6. 2.1 Federal Income Tax, Slide 6 of 43

7. 2.1 Federal Income Tax, Slide 7 of 43 2.1 Federal Income Tax

8. 2.1 Federal Income Tax, Slide 8 of 43 Section Objective The focus of this lesson is to learn how to use tables to find the amount withheld for federal income tax

9. 2.1 Federal Income Tax, Slide 9 of 43 Federal Income Tax (FIT) Money withheld by an employer from an employee’s paycheck Key Words to Know

10. 2.1 Federal Income Tax, Slide 10 of 43 FIT Is calculated using the tables in the back of the book. The tables are displayed based on WEEKLY salary. There are separate tables for married and singles.

11. 2.1 Federal Income Tax, Slide 11 of 43 Allowances The number of dependants you claim for purpose of calculating federal income taxes. Key Words to Know

12. 2.1 Federal Income Tax, Slide 12 of 43 Withholding The amount of money that is “held” from your paycheck. Key Words to Know

13. 2.1 Federal Income Tax, Slide 13 of 43 Annual Salary The salary that you make YEARLY. Bi-weekly Every other week Semi-monthly Twice a month

14. 2.1 Federal Income Tax, Slide 14 of 43 Gross Pay The amount of your salary before deductions. Net Pay The amount of your paycheck.

15. 2.1 Federal Income Tax, Slide 15 of 43 If you get paid every week, how many checks will you get in annually? If you get paid every month, how many checks will you get in annually? If you get paid every other week, how many checks will you get in annually? If you get paid twice a month, how many checks will you get in annually?

16. 2.1 Federal Income Tax, Slide 16 of 43 If you get paid $300 every week, what would be your annual salary? If you get paid $62,000 annually, what would be your monthly pay? If you get paid $2,500 every other week, what would be your annual salary? If you get paid $40,000 annually, what would be your semi-monthly pay?

17. 2.1 Federal Income Tax, Slide 17 of 43 If Mike makes $125 per week, he is single and claims 1 allowance, what is his weekly FIT withholding?

18. 2.1 Federal Income Tax, Slide 18 of 43 If Paul makes $985 per week, is married and claims 6 allowance, what is his weekly FIT withholding?

19. 2.1 Federal Income Tax, Slide 19 of 43 Carla Garza’s annual pay is $39, 600. She is married and claims 2 allowances—herself and her husband. What amount will be withheld from Garza’s pay for FIT? Example 1

20. 2.1 Federal Income Tax, Slide 20 of 43 WHAT DO I DO NOW? HER PAY IS ANNUAL, BUT THE TABLE IS IN WEEKS…..

21. 2.1 Federal Income Tax, Slide 21 of 43 Example 1 Answer Step 1: Calculate Weekly Salary. $761.54

22. 2.1 Federal Income Tax, Slide 22 of 43 Step 2: Find the income range from the federal tax tables

23. 2.1 Federal Income Tax, Slide 23 of 43 Lance Han’s annual gross pay is $31,252. He is single and claims 4 allowance. What amount will be withheld from Han’s pay for FIT? Example 2

24. 2.1 Federal Income Tax, Slide 24 of 43 Example 1 Answer Step 1: Calculate Weekly Salary. $601.00 $31,252 ÷ 52 =

25. 2.1 Federal Income Tax, Slide 25 of 43 Step 2:

26. 2.1 Federal Income Tax, Slide 26 of 43 EmployeeWeekly IncomeAllowancesAmount Withheld D. Caine390.501 A. Kim435.952 D. Cadena399.952 H. Nguyen444.231 G. Ginn382.231 K. Morris421.980 C. Dubinski371.094 Assuming they are married, complete the following table:

27. 2.1 Federal Income Tax, Slide 27 of 43 2.2 STATE INCOME TAX

28. 2.1 Federal Income Tax, Slide 28 of 43 The focus of this lesson is to learn how to calculate state income tax based on a straight percent basis SECTION OBJECTIVE

29. 2.1 Federal Income Tax, Slide 29 of 43 personal exemptions (p. 119) The number of people an employee supports, on which taxes are based KEY WORDS TO KNOW

30. 2.1 Federal Income Tax, Slide 30 of 43 Taxable wages ONLY used for state tax purpose, taxable wages are your wages minus (-) your personal exemptions KEY WORDS TO KNOW

31. 2.1 Federal Income Tax, Slide 31 of 43 How do I calculate taxable wages Taxable Wages Annual Gross Pay Personal Exemptions = –

32. 2.1 Federal Income Tax, Slide 32 of 43 Patricia Line’s gross pay is $65,800 a year. Line takes a married exemption for herself and her husband. What are her taxable wages?

33. 2.1 Federal Income Tax, Slide 33 of 43 Tomoko Nakazawa. Earns $38,657 annually. Married, no dependents. What is the amount of her personal exemptions? What are her taxable wages ?

34. 2.1 Federal Income Tax, Slide 34 of 43 Stephanie Vanderham. Earns $96,315annually. Married, 4 children. What is the amount of her personal exemptions? What are her taxable wages ?

35. 2.1 Federal Income Tax, Slide 35 of 43 How do I calculate annual taxes withheld Annual Taxes Withheld Taxable Wages Tax Rate = X

36. 2.1 Federal Income Tax, Slide 36 of 43 Patricia Line’s gross pay is $65,800 a year. The state income tax rate is 3 percent of taxable wages. Line takes a married exemption for herself and her husband. How much is withheld from her gross pay for state income tax within the year. EXAMPLE 1

37. 2.1 Federal Income Tax, Slide 37 of 43 EXAMPLE 1 (CONTD) Personal Exemptions Single:$2,000 Married: 4,000 Each Dependent: 2,000

38. 2.1 Federal Income Tax, Slide 38 of 43 Step 1: Find the taxable wages. Annual Gross Pay – Personal Exemptions $65,800.00 – $4,000.00 = $61,800.00 EXAMPLE 1 ANSWER:

39. 2.1 Federal Income Tax, Slide 39 of 43 Find the annual tax withheld. Taxable Wages × Tax Rate $61,800.00 × 3% = $1,854.00 How much monthly? $154.50 EXAMPLE 1 ANSWER:

40. 2.1 Federal Income Tax, Slide 40 of 43 Tomoko Nakazawa. Earns $38,657 annually. Married, no dependents. State Tax rate of 5% How much does she pay annually in state tax? EXAMPLE 2

41. 2.1 Federal Income Tax, Slide 41 of 43 Annual Tax $1,732.85 EXAMPLE 1 ANSWER: If she was paid weekly, how much would be withheld each paycheck?

42. 2.1 Federal Income Tax, Slide 42 of 43 Paul Chamello earns $168,000. He is single. His personal exemptions include himself and his five children. The state tax rate is 2.5 percent of taxable income. What amount is withheld yearly for state income tax? ON YOUR OWN 1

43. 2.1 Federal Income Tax, Slide 43 of 43 If her gets paid MONTHLY, how much withholdings each pay check? $325.00 EXAMPLE 1 ANSWER: Yearly State Income Tax $3,900