| A | B |
|---|
| withholding | taking tax payments out of employee’s pay before he or she receives it |
| tax return | a form used to file income taxes |
| taxable income | the earnings on which tax must be paid total income minus exemptions and deductions |
| personal exemption | a set amount that taxpayers may subtract from their gross income for themselves, their spouse and other dependents |
| tax deduction | a variable amount that taxpayers may subtract from their gross income |
| tax credit | a variable amount that taxpayers may subtract from the total amount of their income tax |
| estate tax | a tax on the total value of the money and property of a person who has died |
| gift tax | a tax on the money or property that one living person gives to another |
| tariff | a tax on imported goods |
| tax incentive | the use of taxation to discourage or encourage certain types of behavior |
| mandatory spending | spending that Congress is required by existing laws to do |
| discretionary spending | spending about which Congress is free to make choices |
| entitlement | social welfare program that people are “entitled to” benefit from if they meet certain eligibility requirements |
