Tax FactsThomas Jones, Kristin Martin,

Tierney Gill, Tobi Sieglaff

Corporate Tax Gift Tax Transfer Tax Property Tax Consumption Tax Toll Tax

Tax Overview

Payroll Tax Capital Gains Tax Sales Tax Estate Tax Excise Tax Death Tax

Why Taxation?

Taxation is often a country’s main source of revenue.

Historical OverviewAmerican Revolution

• “No Taxation Without Representation!”

The Federal Constitution• “lay and collect taxes, duties, imposts, and excises,

pay the Debts and provide for the common Defense and general Welfare of the United States”.

The American Civil War• 1861 Revenue Act allowed for a direct tax on

income above $800/year. • This was abolished in 1872 as the war debts

were paid off.

Historical Overview, cont. 16th Amendment

• “The Income Tax fundamentally changed this relationship between the government and the individual, giving the government the right and the need to know about all manner of an individual or business’ economic life.”

Welcome the 20th and 21st Century!• “Great Depression, World Wars, Korea, Vietnam

and the Sixties, Jimmy Carter and Ronald Reagan, the Cold War, Persian Gulf War, September 11th, War on Terror, The Great Recession, fiscal cliffs, healthcare takeovers, and Barack Obama.

Tax Systems Progressive Tax System

• The more that is made, the more is paid in taxes.

• Current tax brackets are 10-15-25-28-33-35-39.6%

Tax Systems, cont. Regressive Tax System

• The tax rate decreases as the amount of income subject to taxation increases.

Tax Systems, cont. Flat Tax System

• The tax rate is fixed as the amount subject to taxation increases.

Rate at which your adjusted gross income is taxed

Money taxed in the bracket it falls under

Americans taxed at two levels

What is the Marginal Tax Rate?

Federal Tax Rate

Wisconsin Tax Rate

TAXABLE INCOME- DEDUCTIONS

Adjusted Gross Income

SalaryCapital gains on stocksDividends receivedInterest receivedRetirement benefits

Taxable Income

Unreimbursed business expenses

Medical expensesDeductible retirement plan contributions

STUDENT LOAN INTEREST

Deductions

JointLower tax liability

Tax BreaksMay tax shelter larger amounts of income

SeparateLower tax bracket

Large itemized deductions

Filing Jointly vs Separately

Divisions of Federal Tax

Medicare Social Security Income Security

http://www.wheredidmytaxdollarsgo.com/

Divisions of State Tax

Department of Transportation

Municipalities Education

Where Taxes Go

Health Insurance Over age of 65 Disabilities

Medicare

Insurance Program Retired Unemployed Disabled

Social Security

Investments Bonds Trust Funds

Income Security

DOT◦ Roads◦ Gas Tax◦ Vehicle Registration

Municipalities ◦ Police/Fire◦ Protect◦ Serve

DOT/Municipalities

Schools◦ Testing◦ Materials◦ Special Needs◦ Trips

Education

Part of a $325,000 National Science Foundation grant went to the creation of “Robosquirrel”

Results?

Taxes Believe it or Not?

NASA’s Advanced Food Technology Project is working to create a menu for Mars.

NASA spends $1 million annually researching and building the menu.

NASA gave Cornell University and the University of Hawaii $947,000 to study the best foods to eat on Mars.

Taxes Believe it or Not?

Taxes Believe it or Not? National Science

Foundation used part of a $516,000 grant to fund creation of Prom Week.

“a new and powerful mode of personal expression”

National Science Foundation gave $30,000 to the University of Washington and Cornell University

“Novel finding”- greater accuracy guessing the sexual orientation of women (64%) than men (57%)

Taxes Believe it or Not?

The Oklahoma Aeronautics Commission voted to keep the rarely used Lake Murray State Park Airport open to get federal funds.

$150,000 yearly from the Federal Aviation Administration

Taxes Believe it or Not?

What are the three tax systems?

Progressive Regressive Flat Tax

What two items are in the Adjusted Gross Income?

Taxable Income Deductions

Gained Insight

What are the two divisions of taxes?

Federal State

Which of these programs are real?

A. A $450,000 program to run an Oklahoma airport that gets one flight per month

B. A $97,000 contest for the best 30-second video on the value of fruits and vegetables

C. A $939,771 study of the sex lives of fruit flies

D. A $1.2 million study on the effects that playing “World of Warcraft” has on elderly people

Gained Insight