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Earned Income Credit
A tax credit for certain people who work, meet certain requirements, and have earned income under a specified limit.
Federal Insurance Contributions Act (FICA) Tax
Provides benefits for retired workers and their dependents as well as for disabled workers and their dependents. Also known as the Social Security tax.
Estate and Gift Tax
One of the oldest and most common forms of taxation is the taxation of property held by an individual at the time of their death. Such a tax can take the form, among others, of estate tax (a tax levied on the estate before any transfers). An estate tax is a charge upon the decedent's entire estate, regardless of how it is disbursed.
Dependent
A person, other than the taxpayer or spouse, who entitles the taxpayer to claim a dependency exemption.
Acquisition
The purchase of one corporation by another, through either the purchase of its shares, or the purchase of its assets.
Excise tax
A tax on the sale or use of specific products or transactions.
Subchapter S
The S-Corporation must complete and file IRS Form 1120s to report its annual income to the IRS each year.
Standard Mileage Rate
For 2004, the standard mileage rate for the cost of operating your car, van, pickup, or panel truck is increased to 37.5 cents a mile for all business miles.
Exemptions
Amount that taxpayers can claim for themselves, their spouses, and eligible dependents. There are two types of exemptions-personal and dependency. Each exemption reduces the income subject to tax. The exemption amount is a set amount that changes from year to year.
Gross income
Money, goods, services, and property a person receives that must be reported on a tax return. Includes unemployment compensation and certain scholarships. It does not include welfare benefits and nontaxable Social Security benefits.
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