You know about taxes. You experience the seemingly endless bite from your paycheck for federal, state, and sometimes local income taxes. You see the chunk of your wages that go to Social Security and Medicare. You write checks for property taxes, and you pay sales tax on virtually every purchase you make. You know the reality (and, to be fair, the necessity) of taxes, but does your teenager?

Kids pay sales tax, of course. Teens who work part-time or at summer jobs often experience their first taste of taxes when they see their first paycheck and learn the true meaning of "take-home pay." But few kids really understand the enormous impact of taxes on one's financial life.

I've written before about my belief in the responsibility of parents to teach their children about personal finance - saving, budgeting and investing - and the reality of taxes should be on that list. As you prepare this year for April 15, consider giving your teenager a little insight into the world of taxes.

But before I begin, I do want to acknowledge that some of my suggestions involve sharing your financial information with your teen, which may make some of you uncomfortable. You always have to use your best judgment about such matters, but in my view, openness and honesty about money and your family's finances are pretty good lessons for teens to learn. And it's certainly better for your teen to learn about taxes now rather than when they enter the work force.

SHOW THEM YOUR PAY STUB

Here's a good way to get started: Take one of your pay stubs and show it to your kid, explaining the difference between your income and your take-home pay. Review each deduction so they can see just how big a chunk the government takes from your salary or wages.

This is a good time to discuss the process of tax money. Explain how income tax, at the federal and state levels, provide the funding for public resources such as highways and the armed forces, medical safety, education and anti-terrorism. Talk about the other major payroll deductions - payments to Social Security (the government-sponsored pension plan) and Medicare (the government-sponsored health care plan for retirees and others); these payments are sometimes lumped under the term FICA or Federal Insurance Contributions Act.

Your pay stub might also reflect deductions for your 401(k) plan. Now would be a great time to start teaching your child about the wisdom of 401(k) participation, and other programs like unemployment insurance or a "flexible spending account," that lets you use pretax dollars for things like health care. And if your teen has experienced the shock of "take-home" pay, compare your pay stubs to show the bigger burden on larger salaries.

SHOW THEM YOUR TAX RETURN

Another way to start teaching your teens about taxes is to show them your completed tax return. Go through it line by line, particularly if you itemize deductions, so they can see how the tax code works. Talk about what kinds of items are tax-deductible. Continued...