Tax is the amount of money demanded by governments to support services and facilities to run a country. The government pays its employees while tax levies support government projects like police activities and firefighters. You might have heard and read so much about taxes, which is why we analyze which of these statements about taxes is false.
Paying taxes is not voluntary and evading the payment is illegal. Some people evade these requirements by not disclosing their actual income. The Internal Revenue Service(IRS) has regulations that allow eligible taxpayers to get deductions and adjustments to their income. Through these levies, the government maintains infrastructures like roads, public amenities like libraries, and government hospitals.
Which of the following statements about taxes is FALSE?
A)Taxes are collected at the local, state, and federal level
B)Some states don’t collect income tax
C)Some states don’t collect sales tax.
D)Local, state and federal taxes are equal.
The last statement is incorrect (D). Taxes at the local, state, and federal level are different from the local taxes being the lowest while federal is highest.
In what circumstances can you complete 1040 instead of a 1040ez?
a. You own a home
b. You make less than $100,000
C. You don’t claim any dependents
D. None of the above
a. You own a home – Owning a home does not attract more taxes.
When can one receive a tax refund from the IRS?
a). When previous payments and applicable credits are higher than the tax owed.
b). The total of previous payments and applicable credits is lower tax owed.
c). The total of previous payments and applicable credits is the same as the tax owed.
d). none of the above.
The first statement is true. Paying tax in excess attracts a refund from the IRS. Confirm this by comparing your total previous payments and any applicable credits to the total income tax that is due. If your submissions are higher than what is owed, then you are eligible for a refund.
The other two statements are incorrect because the second one(B) is the opposite of the real situation. When you owe taxes, it means the government expects you to pay. The third statement (C) is incorrect because there are no overpayments; thus, no refund!
What does the government do with taxes?
a). Assert and remind citizens of its power.
b). Add more expenses to burden citizens.
c). Finance services and infrastructure to enable the smooth running of the nation.
d). None of the above.
A government does not need to assert its power on citizens through taxes; neither is it looking to add a financial burden to its citizens through tax collection, as demonstrated in statements A and B. However, through tax collection, a government runs all public services, builds and maintains infrastructure, and pays salaries to government employees.
Which of these exercises both sales and excise tax?
Both Excise taxes and Sales taxes apply to specific products, but they take a small part of state revenues compared to income and property taxes. They lack a base because they are levied on particular products like tobacco, alcohol, and gasoline.
What is the Internal Revenue Service (IRS) responsible for?
A) Reducing unemployment rates
B) Making tax laws
C) Filling out tax forms for taxpayers
D) Collecting tax and enforcing tax laws
The Internal Revenue Service (IRS) has three main functions: enforcing tax laws, processing tax returns, and taxpayer services. They also conduct criminal investigations on tax malpractices. Statements A and B are false.
Tax is a mandatory levy paid to the government by an individual or a legal entity. As you fathom which of the following statements about taxes is false, keep in mind all the above insights. The finances are used to run or fund government functions, services, and expenditures. Evading taxes or failure to pay taxes is illegal, and one can be prosecuted for it. Also, paying for taxes in excess warrants a refund by the IRS, which regulates the tax laws in a country.