An incentive that lets taxpayers reduce the overall amount of taxes they owe by meeting certain qualifications. Examples of tax credits offered by the IRS include the Child Tax Credit and tax credits for first-time home buyers.
A type of tax professional who is permitted to practice before the Internal Revenue Service (IRS) and can represent taxpayers in audits, collections, and appeals.
Also called the Waxman-Markey Bill, this legislation sought to address climate change while building a clean energy economy. Among other things, this bill established a national cap-and-trade system for greenhouse gases and promoted renewable sources of energy.
A federal law that attempted to avoid or mitigate an economic recession. The Act authorized federal payments of $300 to $1,200 to approximately 130 million American individuals and families. In addition, households received $300 for each qualifying child under the child tax credit. The law also included tax cuts to help the auto industry and to encourage spending by businesses.
The dollar amount a public tax assessor sets in deciding what a piece of property is worth; this figure is used as the basis for calculating how much property tax is owed on the property.
A common law rule whereby taxpayers, when unable to produce records of actual expenditures, may rely on reasonable estimates provided there is some factual basis for it. "Absolute certainty in such matters is usually impossible and is not necessary; the Board should make as close an approximation as it can, bearing heavily if it chooses upon the taxpayer whose inexactitude is of his own making." See Cohan v. Commissioner, 39 F. 2d 540 (2d Cir. 1930).
A tax-deductible expense, usually referring to depreciating the cost of an asset used in business or taking a Section179 expense for that asset.
The selling and repurchasing of an asset, usually stocks or bonds, within a very short time frame. People used to do this to realize a loss for tax purposes, but the IRS caught on and made such losses nondeductible for most taxpayers.