Do You Understand the Basics of Filing Taxes?

1. What are W-2 and W-4 forms used for?

A. A W-2 is used to adjust or establish withholding, and a W-4 is a report of wages earned and taxes withheld

B. A W-2 is used by single people, and a W-4 by married people to adjust withholding

C. A W-2 is a report of wages earned and taxes withheld, and a W-4 is used to adjust or establish withholding

D. A W-2 is a single person’s tax return form, and a W-4 is a married person’s tax return form

Correct!

Wrong!

2. You should start gathering tax documents...

A. As soon as they arrive in your mail or email

B. An hour before you plan to file the return

C. A week before you plan to file the return

D. None of the above

Correct!

Wrong!

3. How much student loan interest can you deduct on your 2019 taxes?

A. Up to $2,000

B. Up to $2,500

C. Up to $2,750

D. Up to $2,250

Correct!

Wrong!

4. The standard deduction and itemized deductions are:

A. Two methods you use in conjunction for tax avoidance

B. The standard deduction is $10,000, and the itemized deduction is $4,050 per person

C. The standard deduction is a deduction for workers, and the itemized deduction is a deduction for businesses

D. Both the standard and itemized deductions are used to reduce taxable income; you select either a fixed (standard) amount or variable (itemized)amount depending on what’s best for your situation

Correct!

Wrong!

5. If you owe the IRS, but can’t afford to pay the balance in full you should...

A. Change your address so they can’t find you

B. File an automatic extension

C. Apply for an installment agreement

D. Hold off filing to gain time to get the dough together

Correct!

Wrong!

6. The filing deadline is in...

A. June, for the tax year ending in April

B. April, for the tax year which ended in December

C. March, unless you file an automatic extension

D. May, but you can always file sooner to get your refund

Correct!

Wrong!

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Do You Understand the Basics of Filing Taxes?