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Tax Facts

Tax Facts. Thomas Jones, Kristin Martin, Tierney Gill, Tobi Sieglaff. Tax Overview. Corporate Tax Gift Tax Transfer Tax Property Tax Consumption Tax Toll Tax. Payroll Tax Capital Gains Tax Sales Tax Estate Tax Excise Tax Death Tax. Why Taxation?.

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Tax Facts

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  1. Tax Facts Thomas Jones, Kristin Martin, Tierney Gill, Tobi Sieglaff

  2. Tax Overview • Corporate Tax • Gift Tax • Transfer Tax • Property Tax • Consumption Tax • Toll Tax • Payroll Tax • Capital Gains Tax • Sales Tax • Estate Tax • Excise Tax • Death Tax

  3. Why Taxation? Taxation is often a country’s main source of revenue.

  4. Historical Overview • American Revolution • “No Taxation Without Representation!” • The Federal Constitution • “lay and collect taxes, duties, imposts, and excises, pay the Debts and provide for the common Defense and general Welfare of the United States”. • The American Civil War • 1861 Revenue Act allowed for a direct tax on income above $800/year. • This was abolished in 1872 as the war debts were paid off.

  5. Historical Overview, cont. • 16th Amendment • “The Income Tax fundamentally changed this relationship between the government and the individual, giving the government the right and the need to know about all manner of an individual or business’ economic life.” • Welcome the 20th and 21st Century! • “Great Depression, World Wars, Korea, Vietnam and the Sixties, Jimmy Carter and Ronald Reagan, the Cold War, Persian Gulf War, September 11th, War on Terror, The Great Recession, fiscal cliffs, healthcare takeovers, and Barack Obama.

  6. Tax Systems • Progressive Tax System • The more that is made, the more is paid in taxes. • Current tax brackets are 10-15-25-28-33-35-39.6%

  7. Tax Systems, cont. • Regressive Tax System • The tax rate decreases as the amount of income subject to taxation increases.

  8. Tax Systems, cont. • Flat Tax System • The tax rate is fixed as the amount subject to taxation increases.

  9. What is the Marginal Tax Rate? • Rate at which your adjusted gross income is taxed • Money taxed in the bracket it falls under • Americans taxed at two levels

  10. Federal Tax Rate

  11. Wisconsin Tax Rate

  12. Adjusted Gross Income TAXABLE INCOME - DEDUCTIONS

  13. Taxable Income • Salary • Capital gains on stocks • Dividends received • Interest received • Retirement benefits

  14. Deductions • Unreimbursed business expenses • Medical expenses • Deductible retirement plan contributions • STUDENT LOAN INTEREST

  15. Filing Jointly vs Separately Separate • Lower tax bracket • Large itemized deductions Joint • Lower tax liability • Tax Breaks • May tax shelter larger amounts of income

  16. Where Taxes Go Divisions of State Tax • Department of Transportation • Municipalities • Education Divisions of Federal Tax • Medicare • Social Security • Income Security • http://www.wheredidmytaxdollarsgo.com/

  17. Medicare • Health Insurance • Over age of 65 • Disabilities

  18. Social Security • Insurance Program • Retired • Unemployed • Disabled

  19. Income Security • Investments • Bonds • Trust Funds

  20. DOT/Municipalities • DOT • Roads • Gas Tax • Vehicle Registration • Municipalities • Police/Fire • Protect • Serve

  21. Education • Schools • Testing • Materials • Special Needs • Trips

  22. Taxes Believe it or Not? • Part of a $325,000 National Science Foundation grant went to the creation of “Robosquirrel” • Results?

  23. Taxes Believe it or Not? • NASA’s Advanced Food Technology Project is working to create a menu for Mars. • NASA spends $1 million annually researching and building the menu. • NASA gave Cornell University and the University of Hawaii $947,000 to study the best foods to eat on Mars.

  24. Taxes Believe it or Not? • National Science Foundation used part of a $516,000 grant to fund creation of Prom Week. • “a new and powerful mode of personal expression”

  25. Taxes Believe it or Not? • National Science Foundation gave $30,000 to the University of Washington and Cornell University • “Novel finding”- greater accuracy guessing the sexual orientation of women (64%) than men (57%)

  26. Taxes Believe it or Not? • The Oklahoma Aeronautics Commission voted to keep the rarely used Lake Murray State Park Airport open to get federal funds. • $150,000 yearly from the Federal Aviation Administration

  27. Gained Insight What two items are in the Adjusted Gross Income? • Taxable Income • Deductions What are the three tax systems? • Progressive • Regressive • Flat Tax

  28. Gained Insight Which of these programs are real? • A. A $450,000 program to run an Oklahoma airport that gets one flight per month • B. A $97,000 contest for the best 30-second video on the value of fruits and vegetables • C. A $939,771 study of the sex lives of fruit flies • D. A $1.2 million study on the effects that playing “World of Warcraft” has on elderly people What are the two divisions of taxes? • Federal • State

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