The Cedar Mountain Kid Income Tax

Did you know that when people earn money, they don't receive the full amount when they get paid?  When their paycheck should be $200, they may only get $180.  Why does this happen?  Where does the money go?

Well, the government demands that everyone must pay a tax on the money they earn.  It's your money and you earned it, yet you must pay a part of it to the government.  The reason for this is because everyone must pay taxes to help keep our country running smoothly.  Our country needs an army, roads, schools, and even the President has to be paid.  All of this is paid for by your personal tax money.  This tax money is called income tax.  Everyone must pay their personal income tax by April 15th each year.

Just how much must we pay each time we earn money?  Well, it depends on how much you earn.  The more you make, the more they take.  It's that simple.  But before we get into that, you must first understand percentage.  A percentage (%) is a part of a whole, or a piece of the pie.

If you divide a pie into four equal parts, one part of that is 25% (just like a quarter).  If you divide it into ten equal parts, one part of that is 10% (just like a dime).  How big or how small and how many parts determines the percentage.

Now, let's pretend you have a job selling newspapers and you're going to be taxed by the government.  You make $10 a week.  Uncle Sam (the U.S. government) wants his cut.  Because you only make $10, he will take it easy on you.  Your tax will be only 10% of what you earn.  To find out how much your tax is, multiply 10 by .10.  To do this we will need a calculator.

To get to the calculator on this computer, follow these directions very carefully: 1. Go to the start menu at the lower left hand corner of this page 2. Go to programs 3. Go to accessories 4. Go to calculator

The calculator should appear in the upper left hand corner of this page. But anytime you click the mouse, the calculator may disappear.  But don't worry, it's at the bottom of the page (minimized), waiting to be used later.

Type 10 X .10 = ? on your calculator.  The answer should be your tax.  $10 X .10 = $1, so therefore your tax should be $1.  How much money will you actually be paid?  $10 - $1 = $9.  Your actual pay is $9.  That wasn't too bad, was it?  Let's try another one. 

Tax can be as low as 5% and as high as 50%.  Remember, the more you make, the more they take.

Answer the following questions on a separate sheet of paper. Show all of your work.  Show all of your work by writing math equations like $100 - $15 = $85 you actually get paid or $200 x .10 = $20 is your tax.   Don’t forget to label your answers.  You may use the calculator on this computer to check your equations.

You make $80 in one week and your tax is 10%.  How much is your tax, and how much do you actually get paid?

You make $500 in one week and your tax is 15%.  How much is your tax, and how much do you actually get paid?

You make $1000 in one week and your tax is 20%.  How much is your tax, and how much do you actually get paid?

You make $2000 in one week and your tax is 30%.  How much is your tax, and how much do you actually get paid?

You won the $1,000,000 lottery and your tax is 50%.  How much is your tax, and how much do you actually get paid?

Now check over your paper, and hand it into your teacher. Remember, your tax dollars are hard at work.