Taxation Activity

Directions: Answer each question to see how you might have to pay each of the three types of taxes some day.
For each section, use your notes to answer questions a and b.

Income tax

1. What is it? (pg. 4)

Answer: payments made by individuals and corporations based on income recieved

2. Which level(s) of government collects it? (pg. 4)

Answer:Federal & State

Click on the following link https://www.ziprecruiter.com/Salaries Then choose one job to type into the box titled
“job title.” Then click “find salary”

3. What job did you choose

Answer: Accounting Manager

4. What is the average salary of that job?

Answer: 105,000

Click on this link. Insert the average salary from the previous answer into the income section, then click
calculate. Scroll down until you find a chart similar to the example below, and use the chart you created to
answer the following questions:

Example: (Don’t use these values, it is just a

reference to see where to look on your chart)

5. What is the federal income tax?

Answer: $15,360

6. What is the state income tax?

Answer:$5,267
 7. What is the total income tax?

Answer: $20,627.

Continue to next page to complete the section on sales tax:

Sales tax

8. What is it? (pg. 4)

Answer: A tax consumers pay on many items they purchase. It is a percentage of the sale price

9. Which level(s) of government collects it? (pg. 4)

Answer: State & Local Government

10. What is one thing that you would like to buy?

Answer: Pandora bracelet

11. Google search what is the price of that good that you want to purchase?

‘Answer: $52.50

12. In Stafford County, the combined sales tax rate is 5.3%. 1% is for the county and 4.3% is for the state.
Use the formula below to calculate how much sales tax you would have to pay on that good.

.053 x (price of good you want to purchase) = sales tax for that good

Answer: $2.78

Continue to next page to complete the section on property tax:

Property tax

13. What is it? (pg. 4)

Answer: A tax levied on land and buildings. Property tax may also be levied on personal property

14. Which level(s) of government collects it? (pg. 4)

Answer: Local Government

You have been very successful in your career and decide to buy the house below in Stafford County. It is
valued at $1,350,000. But now you must pay property taxes on that home. In 2023, the tax rate for Stafford
County was set at $0.93 per 100 dollars of assessed value. Follow the steps below to find how much you’d
pay in property tax each year.

15. Step 1 Complete the formula: 1,350,000 ÷ 100 = ________1,3500________

16. Step 2 Complete the formula: (Step 1 answer) x 0.93 = _ 1255.5______ yearly property tax
Continue to next page to complete the section on public goods and services:

Public Goods and Services

17. Other than tax revenue, what are the other three ways the government pays for public goods and
services? (Notes pg. 5)

Answer: Borrowed funds, Fees paid and fines

18. What is one characteristic of public goods and services? (Notes pg. 5, write the whole phrase not just
one word)

Answer: Provide benefits to many simultaneously

19. Go to page 4 of your notes. Look at the section titled “Part II: What does each level of tax pay for?”. If
you could only choose one public good/service from the federal list and one public good/service from
the state/local list to keep, which would you choose from each list and why? (Notes pg. 4)

Answer:
Federal: National defense, Homeland security, Medical expenditures, Social security and interest
payments on national debt. State and local: Education, Public Health and welfare, Road construction and
repair and public safety. I would choose national defense from the federal government because we need
people to protect our country. I would choose public health and welfare from the state and local government
because without public health no one would get cured from their sickness