Where Do My Tax Dollars Go?

We pay taxes to help our government raise income (called "revenue") to meet its expenses. The revenue raised by the personal income tax and other federal taxes, such as employment taxes (including social security and Medicare taxes), excise taxes, and estate and gift taxes, is used to provide a wide variety of services to the public. Among these are our national defense, conservation of our natural resources, and aid to public education.

The social security tax pays for old age, survivor, and disability pension payments when you become eligible for them. The Medicare tax pays for basic Medicare insurance coverage. Both employees and employers pay these taxes.

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