Tag: Tax Definitions
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Points
Points means:an upfront fee charged by a lender and intended to increase his or her overall yield. A point is 1% of the total principal amount of a loan. For example, on a $100,000 mortgage loan, a charge of three points equals $3,000. If the payment is only for the use of money, it is…
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Ten-year Averaging
Ten-year Averaging Ten-year Averaging means:a method of calculating income tax on a lump-sum distribution from a qualified plan that reduces a beneficiary's tax liability on the distribution. It is available only to a participant who was age 50 years or older before January 1, 1986, […]
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Home Office
Home Office means:an office in the taxpayer's residence used exclusively for business on a regular and continuing basis. The office must be the taxpayer's principal place of business (i.e., where the majority of his or her work is performed) or serve as a place to meet customers […]
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Child
Child means:an individual who is a son, daughter, stepson, or stepdaughter of a taxpayer. See also qualifying person. Former IRC (check if this IRC provision is current here) § 151(c)(3). Description and Definition of Child For income tax purposes, your child is your son, stepson, […]
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Revocable Trust
Revocable Trust means:a trust the provisions of which may be altered as many times as the grantor pleases, or the entire trust agreement can be canceled. A revocable trust differs from an irrevocable trust, which permanently transfers assets from the estate during the grantor's […]
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Dual-status Taxpayer
Dual-status Taxpayer Dual-status Taxpayer means:an alien who is both a nonresident alien and a resident alien during the same tax year. Description and Definition of Dual-Status Taxpayer An alien who is a resident part of the tax year and a non-resident the other part of the tax year. […]
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Tax
Tax means:a rate or sum of money assessed on a citizen's person, property, or activity for the support of government, levied upon assets or real property, upon income, or upon the sale or purchase of goods. Examples include the Ad Valorem tax, excise tax, income tax, property tax, […]
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Short Tax Year
Short Tax Year means:a tax year of a taxpayer that is less than 12 months. Former IRC (check if this IRC provision is current here) §443. See also other Tax Terms and Definitions in U.S.A. annualizing; short period. Description and Definition of Short Tax Year A tax year of less […]
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Annualized Income Installment Method
Annualized Income Installment Method means:a method used to calculate an individual taxpayer's required quarterly estimated tax payment when income is not received evenly throughout the year. The payment for each quarter is calculated using the cumulative taxable income through that […]
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Deferred Compensation
Deferred Compensation means:a plan under whose terms an employee defers payment of a portion of salary in return for the employer's promise to pay the employee the salary at some time in the future. Deferred compensation is common in the sports and entertainment industries. Former […]