TAX 2026 FINAL EXAM PAPER COMPLETE
REVENUE AND COMPLIANCE BLUEPRINT
◉ Payroll Tax
Answer: Federal and state taxes that all employers must pay, based
on a percentage of the employee's salary. They go to such things as
Social Security and Medicare/Medicaid.
◉ Corporate Income Tax
Answer: A percentage of profits paid by a business to the federal and
state government.
◉ Excise Tax
Answer: A tax paid on purchases of a specific good, like gasoline.
◉ Estate Tax
Answer: A tax on property (cash, real estate, stock, or other assets)
transferred from deceased persons to their heirs.
◉ Social Security
, Answer: A program that provides monthly benefits to almost 60
million Americans, including retirees, military families, surviving
families of deceased workers, and disabled individuals.
◉ Medicare
Answer: A government-run insurance program that provides
healthcare assistance to elderly Americans.
◉ Mandatory Spending
Answer: Spending by the federal government required by previously
existing laws. This includes funding programs like Social Security
and Medicare/Medicaid.
◉ Discretionary Spending
Answer: Spending by the federal government determined by
legislative action. In other words, spending approved through votes
by elected officials (i.e. Congress).
◉ Cost of Living
Answer: The amount of money needed to sustain a certain level of
living, including basic expenses such as housing, food, taxes, and
healthcare. Cost of living is often used when comparing how
expensive it is to live in one city versus another.
REVENUE AND COMPLIANCE BLUEPRINT
◉ Payroll Tax
Answer: Federal and state taxes that all employers must pay, based
on a percentage of the employee's salary. They go to such things as
Social Security and Medicare/Medicaid.
◉ Corporate Income Tax
Answer: A percentage of profits paid by a business to the federal and
state government.
◉ Excise Tax
Answer: A tax paid on purchases of a specific good, like gasoline.
◉ Estate Tax
Answer: A tax on property (cash, real estate, stock, or other assets)
transferred from deceased persons to their heirs.
◉ Social Security
, Answer: A program that provides monthly benefits to almost 60
million Americans, including retirees, military families, surviving
families of deceased workers, and disabled individuals.
◉ Medicare
Answer: A government-run insurance program that provides
healthcare assistance to elderly Americans.
◉ Mandatory Spending
Answer: Spending by the federal government required by previously
existing laws. This includes funding programs like Social Security
and Medicare/Medicaid.
◉ Discretionary Spending
Answer: Spending by the federal government determined by
legislative action. In other words, spending approved through votes
by elected officials (i.e. Congress).
◉ Cost of Living
Answer: The amount of money needed to sustain a certain level of
living, including basic expenses such as housing, food, taxes, and
healthcare. Cost of living is often used when comparing how
expensive it is to live in one city versus another.
