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Chapter 5

Gross income

Allowance A number that you calculate on a Form W-4 that reduces the amount withheld from your pay
Deduction Any expenses you can legally subtract from your income when figuring you taxes
Dependent For tax purposes, the people support financially
Form W-2 A summary of your earnings and withholding for the year for a job
Form W-4 A form that you fill out to provide the information your employer needs to determine the proper amount to withhold from your paycheck.
Gross Income Amount you earn before taxes are withheld
Internal Revenue Service Federal agency responsible for collecting income taxes
Net Income Amount you receive after withholding's are subtracted from your gross pay
Withholding Employer deductions from employees' earnings to pay employees' taxes
Created by: Ortizj41