Learn How Taxes Work and the Forms You Need
We’re celebrating Financial Literacy Month this April with blog posts about the importance of financial empowerment – check out our last post about credit cards and credit scores here. Financial Literacy Month coincides with Tax Day (which is on Tuesday, April 18 this year), so today we’re taking a look at taxes!
Each topic in our Financial Literacy Month series corresponds to our free online financial education courses, so be sure to explore all TEN of our short, self-paced modules.
Second in our Financial Literacy Month series? TALKING TAXES!
A tax is a government-regulated fee that you pay on money you earn or on things you purchase. Direct taxes go to the government while indirect taxes like sales taxes do not. Your taxes help to pay for essential state and federal services (learn more about the services you tax pay for in the taxes module.
What are some common Federal Tax Forms?
- W-2: A summary of the previous year’s earnings that you’ll receive from your employer by January 31 each year
- 1040: The US Individual Federal Tax Return form. The info on this form is based off your W-2 and must be filled out and sent to the IRS by the April deadline.
- W-4: The form that gives you some control over how much money the government withholds from your paycheck (you fill this out when you start a new job).
- 1099: The federal tax form used to report income other than salaries, for example freelancers and contractors often use 1099s. This form is filed with the IRS by the person who paid the money (don’t worry – there’s more detail on all these forms in our taxes module).
Learn more about how taxes impact your paycheck, including details on gross income versus taxable income, how to calculate your taxes, and how to determine your tax bracket in our short Taxes Course.
Click here to create your login and take our Taxes Module.
Ready to celebrate Financial Literacy month?
Click here to create your login and get started on all TEN of our free financial empowerment modules!
Want more info on financial education? Check out our fiscal fitness bog post from New Year’s, or head over to the SBA website for some great resources about financial literacy and stay tuned for more in this financial education series.