Tax Terms Glossary | Gain Power With Knowledge

Tax: Property taken away from a taxpayer to support a government.
Taxable Event: An occurrence that affects a person’s tax liability.
Taxable Income: Income that is subject to taxation under law.
Tax Bracket: A range of income levels subject to a marginal tax rate.
Tax Court: A court to determine disputes about tax, penalties, interest, transferee liability, partnership items, and other litigation costs.
Tax Exempt: Something that is not taxed.
Tax Exempt Organization: An organization that is tax exempt.
Tax Gap: The difference between what taxpayers owe and what taxpayers voluntarily pay.
Taxing Authority: A tax authority is a government institution charged with the responsibility of collecting tax.
Taxing Statutes (Tax Laws): A body of laws requiring the payment of tax.
Tax Liability (Tax): The amount of tax due.
Taxpayer: Any person subject to tax. See 26 U.S.C. §7701(a)(14).
Taxpayer Advocate: An office within the IRS designed to assist taxpayers who are having trouble in their dealings with the IRS.
Tax Penalty: An addition to tax imposed by a taxing authority on a taxpayer for violating the taxing statutes.
Tax Planning: An arrangement of a person’s financial affairs in order to minimize their overall tax burden.
Tax Return: A report provided to a taxing authority containing information used to calculate income, or other taxes.
Tax Shelter: A legal structure that reduces the tax liability for an entity or person.
Tax Treaty: An agreement between two or more countries regarding the taxation of their subjects, designed to avoid double taxation. A treaty can be referred to as a convention, treaty, or agreement.
Thing: A thing is more than property, but less than everything.
Trade Date: The date on which a taxpayer executes a trade and contracts to buy or sell a security.
Trade or Business: A regular and continuous activity taken-up for profits.
Trader: Someone who buys and sells financial instruments, such as stocks, bonds, commodities, and derivatives.
Trading: The active buying and selling of financial instruments.
Transaction: A deal or exchange of ideas, currency, commodities, goods, or assets.
Transfer: Voluntarily, or involuntarily, disposing of or parting with property, or an interest in property. See 11 U.S.C. §101(54)
Transfer Pricing: The price that is used on the books of an organization when transferring products, services, or goods from one part of the organization to another.
Trust: A trust is a legal instrument where a settlor transfers property into the name of the trustee who cares for that property pursuant to the settlor’s instructions for the benefit of the beneficiaries.
Trustee: A person who receives property and must act as a fiduciary to care for that property for the benefit of a beneficiary.