Tag Archives: CL

Clifford Trust

Clifford Trust

Clifford Trust means:
a type of inter vivos trust, set up for at least 10 years and a day, that makes it possible to turn over title to income-producing assets. Parents put bonds and stocks in such a trust for their children because the children's income is lower and the taxes are therefore also lower. The income from the trust goes to the children for the duration of the trust. When the trust expires, the parents can reclaim the stocks and bonds. Investment income above $600 received by a child under age 14 is taxed at the parents' highest marginal rate under the Tax Reform Act of 1986. Because of the reversionary interest, the assets will be included in the gross estate of the parent. Former IRC (check if this IRC provision is current here) §§671-679.

Description and Definition of Clifford Trust

A short-term trust in which the principal is reserved by the grantor and current income is paid to the beneficiary. Current tax law makes such trusts ineffective.

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Closing Price

Closing Price

About Closing Price:

Closing Price Or Closing Quote are the price of the last transaction completed during a day's trading session on an organized securities exchange. For purposes of valuation of stock, as in the case of charitable contributions and estates, the closing quote is used.

Closing Costs

Closing Costs

About Closing Costs:

Closing Costs (transaction Costs) are various fees and expenses payable by the seller and buyer at the time of a real estate closing. Closing costs include brokerage commissions, lender discount points and other fees, title insurance premium, deed recording fees, loan prepayment penalty, inspection and appraisal fees, and attorney's fees. With the possible exception of discount points on a home mortgage loan, these costs are normally not deductible, but are added to the basis of the real estate.

Claim for Refund

Claim for Refund

Claim for Refund means:
a claim by a taxpayer to the U.S. Internal Revenue Service for a refund of all or part of the taxes paid in earlier years. Such a claim can result from the correction of an error or the availability of a loss or credit that can be carried back and used to reduce the tax liability of a prior year. An Application for Tentative Refund (Form 1045 for individuals and Former Federal Tax Form (check here if the Form is current) 1139 for corporations) must be filed within 12 months of the end of the tax year that generated the loss or credit. An Application for Tentative Refund is used only to carry back a loss or credit to a prior year in order to recover taxes previously paid.

An amended return (Form 1040X for individuals or Former Federal Tax Form (check here if the Form is current) 1120X for corporations) must be filed within 3 years from the date the original return was filed or within 2 years from the date the tax was paid, whichever is later. An amended return can be used to correct an error or carry back a loss or credit.

A Claim for Refund and Request for Abatement (Form 843) is used to recover overpaid taxes (except income taxes), interest, penalties, and additions to tax. It is also used to request abatement of an overassessment of tax (except income, estate, and gift taxes), interest, additions to tax, or penalty.

See also other Tax Terms and Definitions in U.S.A.

claim-of-right doctrine. Former IRC (check if this IRC provision is current here) §6402.

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See the entries Income Tax and State Income Tax in the American Encyclopedia of Law.

See Tax Forms in the Encyclopedia.

Clergy

Clergy

Clergy means:
a duly ordained, commissioned, or licensed minister of a church, a member of a religious order, or a Christian Science practitioner; may elect to be exempted from the Social Security system by filing an exemption certificate, Former Federal Tax Form (check here if the Form is current) 4361. See also Former IRC (check if this IRC provision is current here) § 1402(e)(1). Further, the rental value of a dwelling provided to clergy is exempt from the income tax, as is a rental allowance to the extent that the allowance is used to rent or obtain a house or other dwelling. Both rental value and rental allowance, however, are subject to the Social Security tax. Former IRC (check if this IRC provision is current here) §3121.

See the entries Income Tax and State Income Tax in the American Encyclopedia of Law.

See Tax Forms in the Encyclopedia.

Club Dues

Club Dues

Club Dues means:
membership fees. No deduction is permitted after 1993- Earlier, deduction was permitted for club dues if the taxpayer establishes that the club is used primarily for the furtherance of his or her trade or business. After this test is met, the taxpayer may then deduct only that portion of the dues that qualifies as “directly related” to the active conduct of such trade or business. No deduction is permitted for an initiation or similar fee that is payable only upon joining a club if the useful life of the fee extends over more than 1 year. Such initiation fees are nondeductible capital expenditures. Former IRC (check if this IRC provision is current here) §274(a)(3).