Financial Literacy Month Part 4: Taxes

How To Explain the Concept to Your Children:

Taxes pay for all kinds of government jobs and services. Federal taxes help pay for national things like Congress, government healthcare, and the military. State taxes pay for roads and state parks. County and city taxes help pay for schools, fire trucks, and the police. Without taxes, the government couldn't run.

Federal taxes are paid as part of a progressive federal income tax system. This  means that higher-income people are asked to pay a higher average tax rate than lower-income people.

How to Teach Your Children:

Ask your students about the last time they visited a national park, they played in a local playground, or any other neighborhood activity they enjoyed. Ask them to share their experiences and memories about the event/day.

Then ask them how much it costs to maintain parks, playgrounds, roads, or even their school (if they attend a public school). This is a great opportunity to explain that the activity was funded by taxes.