Each type of tax is different and is calculated differently, paid at different times, and supports different agendas. It is imperative that tax professionals and individuals know tax laws. Learning to use tax laws effectively can make the difference between avoiding tax and committing tax evasion.

In the overall picture, taxes affect your personal finances, your investment choices, your business success, and even your politics. Learning about taxes is essential to your financial future.

Address the following questions in your response.

1. What are some of the notable characteristics of tax?
2. What is not considered a tax base used by government agencies to collect tax?
3. Federal income taxes include a variety of different tax bases. What tax base is not a federal tax?
4. Like federal income taxes, state and local taxes include a variety of different tax bases. What tax base is neither a state nor local tax?
5. Even though transfer taxes do not affect all individuals, individuals affected by a transfer tax can experience a high tax liability. What taxes are not considered a transfer tax?
6. Tangible personal property is taxed by state and local governments. What is an example of something that is not considered tangible personal property?
7. What is an example of something that excise tax is not levied on?
8. It is not unusual for people to make a mistake on their individual tax returns. When an individual taxpayer realizes that a mistake has been made, an amended tax return should be filed. Due to the statute of limitations in the Internal Revenue Code (IRC), what is the latest date that the amended return can be filed without causing a filing penalty?
9. Income-shifting transactions between family members have limitations. In the list below, what concept does not relate to family member transactions?
10. Tax rates can vary with different types of income. What are some examples of income that are taxed differently than the others?
11. Tax evasion is defined as a willful attempt to defraud the government. What are some examples of an attempt to commit fraud?
12. In many cases, there is a fine line between tax avoidance and tax evasion. In a situation where the distinction between the two is not clear, professional judgment must be used. Other tools can also be used. What tools can be used to distinguish between tax avoidance and tax evasion?