Analyzing Government Tax Assignment Discussion
Analyzing Government Tax Assignment Discussion
Former Supreme Court Chief Justice John Marshall once stated, “The power to tax is the power to destroy.” The power to tax, the principle of taxation, and the effect taxes have on citizens has existed since the inception of America itself. However, much of it is misunderstood.
Use the sample property tax bill, pay stub, utility bill, and sales tax receipt below to complete the Analyzing Tax Worksheet. Analyzing Government Tax Assignment Discussion
Complete all five parts of the worksheet.
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Part One: Income Tax
Use the sample pay stub provided to fill in the table below.
| Who Determines the Amount of Tax? | Services the Tax is Applied Towards | |
| Federal Tax | The internal revenue service (IRS) determines the federal income tax under the federal government after applying the adjusted gross income (AGI), deductions, and exemptions within the taxable income. | Mandatory spending
Social security retirement benefit and income for disabled workers, Medicare subsidized healthcare services, welfare services that include food stamps, child tax credits, child nutrition programs, housing assistance, the earned income tax credit, unemployment benefits, student loans, and programs for veterans (Steuerle & Smith, 2022)Analyzing Government Tax Assignment Discussion. Discretionary spending: Defense and Nondefense Defense: Department of protection, state department, and homeland security. Nondefense: Education, veteran assistance, and housing and urban development. |
| State Tax | Each state government determines the taxable income | State taxes are applied to the following services: –
Education – k-12 and higher education, healthcare – Medicare and children’s healthcare insurance program, transportation, public assistance, correction, and others that include care for a resident with disabilities, pensions, health benefits for public employees, economic development, environmental project, state police, parks and recreation, and general aid to local government (Center on Budget and Policy Priorities, 2018, p.1)Analyzing Government Tax Assignment Discussion. |
| Social Security Tax | The federal government determines the amount of the social security tax. It takes an equal percentage of 6.2% from both the employee and the employer. | Social security taxes provide benefits to retirees, people unable to work due to diseases or disabilities, and children of deceased workers (Steuerle & Smith, 2022). |
| Medicare Tax | The federal government determines a Medicare tax amount of 2.9% is split between an employee and their employer (Flynn, 2022, p. 1). | Medicare tax funds hospitals, hospice, and nursing home expenses for the elderly, disabled individuals, and people with medical conditions. |
Part Two: Sales Tax
Use the sample sales receipt provided to answer the questions below.
- List all the taxes (percent, amount, etc.) on the receipt.
Sales Tax: $0.77
Total price for (2) items: $8.99
Total Tax: $0.77
Total $9.76
- Who determines the amount of each tax?
Arizona (5.6%), Maricopa County (0.7%), and the city of Phoenix (2.3%) determine the amount of sales tax on the receipt for the purchase made in Phoenix, AZ. A city tax rate of 8.6% is used to compute the city’s sales tax rate (Avalara, 2022)Analyzing Government Tax Assignment Discussion.
- Where does revenue from this tax go? What does it fund?
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This tax generates cash for the local and state governments, which they use to support their operations and pay for general expenses. Each local government can decide whether to impose a sales tax on goods made inside its boundaries.
Part Three: Utility Tax
Use the sample utility bill provided to answer the questions below.
- List all the taxes (percent, amount, etc.) on the bill.
Water Base Fee: $4.36
Water Usage Fee: $7.54
Environmental Mandates – Water: $4.5
City service tax: $1.50
Sewer Fee: $15.89
Environmental Mandates – Sewer: $3.62
State Mandated Jail Costs: $1.00
City sales tax: $0.97
State and other tax: $1.80
Refuse: $26.80
State Landfill Disposal Fee: $0.05
- Who determines the amount of each tax?
Because the individual resides in Phoenix, AZ, the utility tax rate is determined by Arizona, Maricopa County, and the city of Phoenix. The gross sales of electricity, gas, and water generated outside of Arizona and transported to a location within Arizona are also included in the utility tax base.
- Where does revenue from this tax go? What does it fund?
City Services Tax $ 1.50 – This tax is used to maintain essential city services inside city bounds, including public safety and criminal justice.
City Sales Tax $ 0.97 – financing for maintaining city streets and other items. Contributes to funding city-run services or initiatives.
State and Other Taxes $ 1.80 – This tax supports several state-run initiatives by going to the state Analyzing Government Tax Assignment Discussion.
Part Four: Property Tax
Use the sample property tax statement provided to answer the questions below.
- List all the taxes (percent, amount, etc.) on the statement.
STATE EQUALIZATION TAX
Rate: (51%)
Year: 2014 $8.70
Year: 2015 $8.58
Change: -1.4%
FIRE DISTRICT ASSISTANCE TAX
Rate: (1%) Year: 2014 $0.20
Year: 2015 $0.20
Change: -1.4%
- Who determines the amount of each tax?
These taxes are determined by the total or partial tax levy raised by a taxing district and that district’s taxable assessed value. The evaluated Property tax is calculated in September using the value multiplied by 100 and the tax rate (which is established in August of every year). Property taxes are billed, gathered, and dispersed by the county treasurer.
- Where does revenue from this tax go? What does it fund?
The proceeds from these taxes support county and local government. Additionally, it helps to pay for amenities like the police/fire department and the waste disposal facility. Local and state governments’ operating budget or maintenance is funded through direct property taxes (Hickman, 2022)Analyzing Government Tax Assignment Discussion. Voters’ approved expenditures (such as school budget overrides) or special district levies are paid for by secondary property taxes.
Part Five: Summary and Analysis
Write a 200-350-word summary below of your findings and what you have learned about how you are taxed.
Tax payment is regarded as a civic obligation, but it is also a legal requirement. The Internal Revenue Service, or IRS, is the federal body managing taxes. Among the many penalties for failing to pay taxes include fines, jail time, and the need to do so in the future. The money spend in taxes and benefits goes toward funding the police and fire departments and supporting government employees by paying their salaries (Selafristy & Rahman, 2022). Additionally, tax money is used to build and renovate our roads, ensuring their safety and upkeep. Taxes are used to pay for community services like parks, public libraries, Habitat of Humanity, and the Salvation Army, to name a few.
There are numerous taxation methods and taxation forms. For instance, we earn money by working at a job, and as a result, we pay any income tax. Additionally, a fixed amount of tax is deducted from your earnings and administered by the government. Everything depends on how much money you make. Furthermore, if a person’s paychecks are not withheld from enough yearly taxes to cover the amount of taxes due, they will likely need to pay more taxes or send the government more money (Selafristy & Rahman, 2022)Analyzing Government Tax Assignment Discussion. On the other hand, if the level of taxes withheld from a person’s paycheck is too high, the person will be entitled to compensation from the government.
References
Hickman, K. E. (2022). The Federal Tax System’s Administrative Law Woes Grow. American Bar Association Tax Times, 41(2).
Selafristy, T., & Rahman, A. (2022). The Effectiveness of Technology Innovation In Tax Payment Services on Compliance of Land and Building Tax. https://scholar.archive.org/work/pns72t664nggxm2i4bsadid66q/access/wayback/https://eudl.eu/pdf/10.4108/eai.15-9-2021.2315246
Steuerle, C. E., & Smith, K. E. (2022). Social Security & Medicare Lifetime Benefits and Taxes: 2021. https://www.urban.org/sites/default/files/publication/105465/social-security-medicare-lifetime-benefits-and-taxes-2021.pdf
Former Supreme Court Chief Justice John Marshall once stated, “The power to tax is the power to destroy.” The power to tax, the principle of taxation, and the effect taxes have on citizens has existed since the inception of America itself. However, much of it is misunderstood.
Use the sample property tax bill, pay stub, utility bill, and sales tax receipt below to complete the Analyzing Tax Worksheet.
Complete all five parts of the worksheet.
Part One: Income Tax
Use the sample pay stub provided to fill in the table below.
| Who Determines the Amount of Tax? | Services the Tax is Applied Towards | |
| Federal Tax | The internal revenue service (IRS)determines the federal income tax under the federal government after applying the adjusted gross income (AGI), deductions, and exemptions within the taxable income. | Mandatory spending
Social security retirement benefit and income for disabled workers, Medicare subsidized healthcare services, welfare services that include food stamps, child tax credits, child nutrition programs, housing assistance, the earned income tax credit, unemployment benefits, student loans, and programs for veterans (Steuerle & Smith, 2022). Discretionary spending: Defense and Nondefense Defense: Department of protection, state department, and homeland security. Nondefense: Education, veteran assistance, and housing and urban development. |
| State Tax | Each state government determines the taxable income | State taxes are applied to the following services: –
Education – k-12 and higher education, healthcare – medicare and children’s healthcare insurance program, transportation, public assistance, correction, and others that include care for a resident with disabilities, pensions, health benefits for public employees, economic development, environmental project, state police, parks and recreation, and general aid to local government (Center on Budget and Policy Priorities, 2018, p.1). |
| Social Security Tax | The federal government determines the amount of the social security tax. It takes an equal percentage of 6.2% from both the employee and the employer. | Social security taxes provide benefits to retirees, people unable to work due to diseases or disabilities, and children of deceased workers (Steuerle & Smith, 2022). |
| Medicare Tax | The federal government determines a medicare tax amount of 2.9% is split between an employee and their employer (Flynn, 2022, p. 1). | Medicare tax funds hospitals, hospice, and nursing home expenses for the elderly, disabled individuals, and people with medical conditions. |
Part Two: Sales Tax
Use the sample sales receipt provided to answer the questions below.
- List all the taxes (percent, amount, etc.) on the receipt.
Sales Tax: $0.77
Total price for (2) items: $8.99
Total Tax: $0.77
Total $9.76
- Who determines the amount of each tax?
Arizona (5.6%), Maricopa County (0.7%), and the city of Phoenix (2.3%) determine the amount of sales tax on the receipt for the purchase made in Phoenix, AZ. A city tax rate of 8.6% is used to compute the city’s sales tax rate (Avalara, 2022)Analyzing Government Tax Assignment Discussion.
- Where does revenue from this tax go? What does it fund?
This tax generates cash for the local and state governments, which they use to support their operations and pay for general expenses. Each local government can decide whether to impose a sales tax on goods made inside its boundaries.
Part Three: Utility Tax
Use the sample utility bill provided to answer the questions below.
- List all the taxes (percent, amount, etc.) on the bill.
Water Base Fee: $4.36
Water Usage Fee: $7.54
Environmental Mandates – Water: $4.5
City service tax: $1.50
Sewer Fee: $15.89
Environmental Mandates – Sewer: $3.62
State Mandated Jail Costs: $1.00
City sales tax: $0.97
State and other tax: $1.80
Refuse: $26.80
State Landfill Disposal Fee: $0.05
- Who determines the amount of each tax?
Because the individual resides in Phoenix, AZ, the utility tax rate is determined by Arizona, Maricopa County, and the city of Phoenix. The gross sales of electricity, gas, and water generated outside of Arizona and transported to a location within Arizona are also included in the utility tax base.
- Where does revenue from this tax go? What does it fund?
City Services Tax $ 1.50 – This tax is used to maintain essential city services inside city bounds, including public safety and criminal justice.
City Sales Tax $ 0.97 – financing for maintaining city streets and other items. Contributes to funding city-run services or initiatives.
State and Other Taxes $ 1.80 – This tax supports several state-run initiatives by going to the state.
Part Four: Property Tax
Use the sample property tax statement provided to answer the questions below.
- List all the taxes (percent, amount, etc.) on the statement.
STATE EQUALIZATION TAX
Rate: (51%)
Year: 2014 $8.70
Year: 2015 $8.58
Change: -1.4%
FIRE DISTRICT ASSISTANCE TAX
Rate: (1%) Year: 2014 $0.20
Year: 2015 $0.20
Change: -1.4%
- Who determines the amount of each tax?
These taxes are determined by the total or partial tax levy raised by a taxing district and that district’s taxable assessed value. The evaluated Property tax is calculated in September using the value multiplied by 100 and the tax rate (which is established in August of every year). Property taxes are billed, gathered, and dispersed by the county treasurer.
- Where does revenue from this tax go? What does it fund?
The proceeds from these taxes support county and local government. Additionally, it helps to pay for amenities like the police/fire department and the waste disposal facility. Local and state governments’ operating budget or maintenance is funded through direct property taxes (Hickman, 2022). Voters’ approved expenditures (such as school budget overrides) or special district levies are paid for by secondary property taxes. Analyzing Government Tax Assignment Discussion
ORDER TODAY
Part Five: Summary and Analysis
Write a 200-350-word summary below of your findings and what you have learned about how you are taxed.
Tax payment is regarded as a civic obligation, but it is also a legal requirement. The Internal Revenue Service, or IRS, is the federal body managing taxes. Among the many penalties for failing to pay taxes include fines, jail time, and the need to do so in the future. The money spend in taxes and benefits goes toward funding the police and fire departments and supporting government employees by paying their salaries (Selafristy & Rahman, 2022). Additionally, tax money is used to build and renovate our roads, ensuring their safety and upkeep. Taxes are used to pay for community services like parks, public libraries, Habitat of Humanity, and the Salvation Army, to name a few.
There are numerous taxation methods and taxation forms. For instance, we earn money by working at a job, and as a result, we pay any income tax. Additionally, a fixed amount of tax is deducted from your earnings and administered by the government. Everything depends on how much money you make. Furthermore, if a person’s paychecks are not withheld from enough yearly taxes to cover the amount of taxes due, they will likely need to pay more taxes or send the government more money (Selafristy & Rahman, 2022). On the other hand, if the level of taxes withheld from a person’s paycheck is too high, the person will be entitled to compensation from the government Analyzing Government Tax Assignment Discussion