BUISENESS MANAGEMENT
TAXES
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Tax on Earned Income
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Tax on Unearned Income
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Tax on Earned and Unearned Income
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Taxes on the Wages you earn from your Employer
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Detailed explanation-1: -° Earned income: Money made from working for someone who pays you or from running a business or farm. This includes all the income, wages, and tips you get from working. ° Unearned income: Income people receive even if they don’t work for pay.
Detailed explanation-2: -(Accounting: Financial statements, Balance sheet) Unearned income is income that is received before it is earned by goods being delivered or services performed, or income that you do not have to work to earn, such as from property and investment.
Detailed explanation-3: -Unearned income works differently than earned income. You don’t have to pay any payroll taxes, including Social Security and Medicare, on the various forms of unearned income. However, your unearned income (line 37 of your Form 1040) will count toward your adjusted gross income on your state and federal tax returns.