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Income Taxes
Question | Answer |
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A deviation from the basis grade or location allowable when delivering commodities under the terms of a futures contract. Allowances represent a premium or discount to the standards outlined in the futures agreement. | Allowance |
An accounting term applicable to stockholders of closely held businesses. Accumulated earnings and profits are a company's net profits after deducting distributions to the stockholders. This is calculated as of the beginning of the year. | Accumulated Earnings |
An individual who a taxpayer can claim for credits and/or exemptions. | Dependent |
Electronic funds that are deposited directly into your bank account rather than through a paper check. | Direct Deposit |
Income derived from active participation in a trade or business, including wages, salary, tips, commissions and bonuses. | Earned Income |
a person working for another person or a business firm for pay. | Employee |
a person or business that employs one or more people, especially for wages or salary. | Employer |
A deduction allowed by law to reduce the amount of income that would otherwise be taxed. | Exemptions |
A tax levied by the United States Internal Revenue Service (IRS) on the annual earnings of individuals, corporations, trusts and other legal entities. | FICA |
A U.S. law requiring a deduction from paychecks and income that goes toward the Social Security program and Medicare. | Federal Income Tax |
An individual's total personal income before taking taxes or deductions into account. | Gross Income |
Economic wealth that is generated in exchange for an individual's performance of agreed upon activities or through investing capital. | Income |
An employee's earnings that are subject to a U.S. payroll tax, similar to the other U.S. payroll tax. | Medicare Tax |
A company's total earnings (or profit). | Net Income |
The tax levied on both employers and employees used to fund the Social Security program. | Social Security Tax |
The form that an employer must send to an employee and the IRS at the end of the year. Read more: http://www.investopedia.com/terms/w/w2form.asp#ixzz2H23MD8aW | W-2 Form |
A form completed by an employee to indicate his or her tax situation (exemptions, status, etc.) to the employer. | W-4 Form |
The portion of an employee's wages that is not included in his or her paycheck because it is remitted directly to the federal, state and local tax authorities. | Withholding |
money earned by a person who sells things for someone else. | Commission |
Any item or expenditure subtracted from gross income to reduce the amount of income subject to tax. | Deduction |