Video: Tax Filing

In this lesson, Nick Palazzolo, CPA, unpacks the complexities of marginal tax brackets, offering easy-to-understand explanations that demystify the progression from one tax bracket to another. Emphasizing that while memorizing exact tax brackets isn't essential, Nick reveals the critical importance of grasping the general concept for the exam, including the difference between a taxpayer's marginal tax rate and their effective tax rate. Furthermore, he clearly differentiates between the legal practice of tax avoidance and the criminal act of tax evasion. The lesson also covers the standard tax filing deadline, what constitutes a need to file a return, and the procedural know-how for requesting an extension, ensuring that when it comes to taxes, viewers are kept firmly within the bounds of the law.

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Video Transcript

Instructor: Nick Palazzolo

Nick Palazzolo is head instructor of ExamPrep.ai CPA Review. Nick's teaching style is engaging & upbeat, combining practical Big 4 tax & assurance expertise with years of 1-on-1 coaching. His lessons are concise and emphasize what you need to know to pass. Whether you're a recent grad or working full-time, we’re confident you can conquer your CPA exams with Nick’s review.

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Marginal tax brackets, again, this might be something you're familiar with just from school, just understanding how the tax system works. However, if you're not, we're going to dive through it and make sure you understand. So you might think, and these tax brackets change year to year, not day to day. I mean, they change. It'd be nice if they stayed the same, but inflation happens and things change all the time. Now the marginal tax brackets do, like I said, they do change. I would be familiar with them. We'll include them in our resources as they do change year to year. So make sure you're looking in the resources and memorizing the current tax brackets. Now I say memorize, there's a lot to memorize within that. And you likely won't really need to know the exact numbers for tax purposes, unless you memorize every other threshold, every other number you need to memorize, phase out, everything like that. I wouldn't worry about specifically and perfectly memorizing these. However, I would get a general idea of knowing that, okay, the first zero to $10,000 of income is taxed at 10%, right? Or the next $10,000 to $20,000 is taxed at 5%, whatever it is. I would get a general idea for how that all works. And on a question on the exam, you're likely to get a made up one like we have here. This is a simplified tax bracket, three brackets with our real system. There's a lot more brackets and a lot more nuance. Now you might think, and this is what I thought when I started taking accounting courses all the way back in college is, oh, I have income over $20,000. As such, all of that income is taxed at 30%. That's not how

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Federal Taxation of Individuals: Filing Status, Gross Income, & Adjustments

Module: 3 Concepts, 54 Videos

Filing Status Overview

0:26

Introduction to Filing Status

4:27

Tax Filing Options

12:16

Married Filing Separately vs. Filing Jointly