| A | B |
|---|
| revenue | money collected by the government from citizens and companies in the form of taxes |
| progressive taxes | taxes that take a larger share of income as the amount of income grows |
| regressive taxes | taxes that take a smaller share of income as the amount of income grows |
| excise tax | sales taxes imposed on specific goods and services |
| proportional taxes | also called flat taxes(tax rate stays the same regardless of the amount on which the tax is imposed. |
| tax brackets | income ranges on which tax rates apply |
| tax evasion | willful failure to pay taxes |
| audit | examination of a taxpayer's tax return |
| exemption | an amount you may subtract from your income for each person who depends on your income to live |
| gross income | all the taxable income you receive including wages, tips, salaries, etc. |
| child support | money paid to a former spouse for support of dependent children |
| alimony | money paid to support a former spouse |
| adjusted gross income | income minus allowable exclusions (such as IRA's and alimony) |
| IRA | Individual Retirement Account |
| deductions | expenses the law allows you to subtract free from your adjusted gross income to determine your taxable income |
| itemize | to list allowable expenses on your tax return |
| standard deduction | a stated amount that you may subtract from adjusted gross income instead of itemizing your deductions |
| taxable income | the income on which you will pay tax |
