Why Do We Pay Taxes?

In this lesson, we will explore why we pay taxes and how our money is used. The federal, state, and local governments enact tax laws that provide for a variety of government services, but what are the differences?

Read the first article and the second article just through the second section titled “Understanding Local Tax”. Then, answer the questions.

How Are My State Taxes Spent?

Local Tax Definition

If Paychecks Could Talk

Now that you’ve learned about how tax money is used at the federal, state, and local level, let’s take a deeper dive specifically into our federal tax dollars. Watch this video to learn where federal tax revenue comes from and what exactly the federal government is spending that money on.

NOTE: EdPuzzle videos shuffle answer choices and do not always match the order provided in the lesson here.

Payroll Tax [vs. Income Tax]

In the previous resource, you learned that you pay Payroll, or FICA taxes, and Income taxes. Let’s take a deeper look at the differences between these two important taxes! Skim through this article and then answer the questions.

Flat Tax vs. Progressive Tax

9 Types of Taxes in the US

Let’s take a look at some different ways we pay our taxes. Review this infographic and answer the questions.

Three Types of Tax Systems

You now know more about where tax money comes from and how it’s being spent. But how does it all work? There are 3 main types of tax systems. Watch this video to learn about the differences between regressive, proportional, and progressive taxes. Then, answer the questions.

How Tax Brackets Actually Work

Because the U.S. uses a specific type of tax system that you learned about in the previous resource, people are taxed on a rate schedule that breaks down their income into tax brackets. Watch this video and follow your teacher's directions to answer the questions either in your student activity packet or within the EdPuzzle itself.

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