The U.S Treasury Department sets tax collection policy and tax laws. A branch of the U.S. Treasury is the Internal Revenue Service (IRS) that has adjusted tax brackets for the next year, which moves you into the next higher tax bracket than where you are now. Also, the federal government has released cost of living numbers and determined the inflation rate to be 4% annually. Both of these situations impact your budget and your financial plan. What parts of your budget and plan need adjusting? What alternatives are available to reduce taxes? How will you ensure the modifications to your budget and plan are effective?

You will use the 5-step critical thinking problem-solving process, IDEAS, to work through any problems to determine a solution for a given problem and for any other problems you encounter.

I IDENTIFY the Problem and Set Priorities (Step 1)

D DEEPEN Understanding and Gather Relevant Information (Step 2)

E ENUMERATE Options and Anticipate Consequences (Step 3)

A ASSESS the Situation and Make a Preliminary Decision (Step 4)

S SCRUTINIZE the Process and Self-Correct as Needed (Step 5)