Money Management Skills



Lecture 9: Essential Tax Principles

% ,I\RX¿QGWKDW\RX¶UHFRQVLVWHQWO\JHWWLQJDELJUHIXQG\RXFDQ

FKDQJH\RXU:IRUPZKLFKWHOOV\RXUHPSOR\HUKRZPXFKWRVHW

DVLGHIURPDSD\FKHFN,WPLJKWEHEHVWWRJHWVRPHKHOSGRLQJWKLV

EHFDXVH\RX¶OOEHSHQDOL]HGLI\RXGRQ¶WZLWKKROGHQRXJK0DQ\

SHRSOHGRQ¶WPLQGJHWWLQJDUHIXQGEHFDXVHLW¶VDIRUFHGVDYLQJV

GHYLFHDQGWKHUHLVQ¶WPXFKRIDWUDGHRIIWROHWWLQJWKHJRYHUQPHQW

NHHS\RXUPRQH\ZKHQLQWHUHVWUDWHVDUHORZ

% %HFDXVHPRVWZRUNHUVKDYHPRUHPRQH\ZLWKKHOGWKDQWKH\RZH

LQWD[HVWKH\¶OOJHWDWD[UHEDWH,I\RXKDYH\RXUUHIXQGGLUHFW

deposited, then it will take about one to two weeks for the money to

VKRZXSLQDQDFFRXQW,WPLJKWEHDJRRGLGHDWRSODQLQDGYDQFH

IRUKRZ\RXZLOOVSHQGDUHIXQGLI\RXQHHGDIRUFHGVDYLQJVGHYLFH

% Other households may have to pay extra because they make money

LQDGGLWLRQWRWKHVDODU\WKH\UHFHLYHGIURPDQHPSOR\HU,QWKLV

case, you will need to estimate your tax bill and make regular

TXDUWHUO\SD\PHQWVLQRUGHUWRDYRLGLQWHUHVWFKDUJHVDQGSHQDOWLHV

IRU XQGHUSD\PHQW ,I \RX KDYH UHQWDO RU RWKHU VHOIHPSOR\PHQW

income, an easy solution is to have your primary employer withhold

DOLWWOHPRUHIURP\RXUSD\FKHFNE\XVLQJWKH:IRUP

% 2QFH \RX¶YH ¿QLVKHG \RXU IHGHUDO WD[ IRUP \RX¶OO KDYH WKH

QXPEHUV\RXQHHGWR¿OORXWWKHVWDWHWD[IRUPIRUPRVWVWDWHV

$QRWKHUDGYDQWDJHWRKDYLQJDORZHUDGMXVWHGJURVVLQFRPHLVWKDW

PDQ\VWDWHVXVHWKDWQXPEHUWRHVWLPDWHVWDWHWD[HV7KHUHLVDORWRI

YDULDWLRQLQVWDWHLQFRPHWD[HV

Payroll Taxes and Property Taxes

% While taxes make up half of federal revenue, payroll taxes make

XSDERXWDWKLUG3D\UROOWD[HVDUHZLWKGUDZQWRSD\IRU0HGLFDUH

DQG6RFLDO6HFXULW\3D\UROOWD[HVDUHOHVVSURJUHVVLYHWKDQLQFRPH

WD[HVEHFDXVHHYHU\RQHSD\VWKHVDPHSHUFHQWDJH

% )RU6RFLDO6HFXULW\ZHSD\SHUFHQWRIRXUJURVVZDJHLQFRPH

DQGVRGRHVRXUHPSOR\HU6RWKLQJVOLNHSXWWLQJPRQH\LQDN

ZRQ¶WUHGXFHWKHDPRXQW\RXSD\LQWR6RFLDO6HFXULW\7KH6RFLDO