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1. Increasing your 401k deduction will ________ your gross pay and __________your federal taxes in the current year. |
Not change, decrease |
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2. Decreasing W-4 allowances will ________ the net pay in your paycheck and ______ your total tax burden. |
Decrease, not change |
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3. Suppose you filed your taxes and received a small refund from the IRS. What would have been the impact on the refund amount if you had increased the W-4 allowances for that tax year? |
The refund would be smaller or you may owe taxes |
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4. Assume you are participating in your employer’s direct deposit program. On payday, the employer deposits your ________ into your bank account. |
Net pay |
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5. Many tax professionals and advisors recommend adjusting your W-4 allowances so that… |
you minimize your tax liability |
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