An automatic extension provides taxpayers with additional time to file their tax return by submitting IRS Form 4868 or Form 7004 by the original due date. However, the estimated tax payment remains due on the original filing date.
The average tax rate is calculated by dividing total taxes paid by total income. It indicates the amount of tax paid per dollar earned, serving as a key measure in understanding overall tax burden.
A budget mortgage is a type of mortgage that necessitates monthly payments covering property taxes and insurance alongside principal and interest.
Capital gains refer to the profit realized from the sale of assets or investments, which exceeds the purchase price. They can apply to stocks, bonds, real estate, and other types of investments.
Cash outflows are the financial transactions where a business expends cash, which is essential for managing liquidity and business operations.
A Concession Agreement is a contract between a host government's government and a foreign firm that outlines the terms under which the firm will invest in the host country, covering aspects like taxes, profit remittance, and ownership transfer.
Deadweight loss represents the cost to society created by market inefficiency, which can occur in different forms, such as monopoly pricing, externalities, taxes, subsidies, and scarcity pricing.
A deferred account is a financial account that postpones tax obligations until a later date, allowing the account holder to potentially reduce their current tax burden.
Economic costs represent the projected costs revealed by an economic appraisal, excluding transfer payments within the economy such as taxes and subsidies.
A financial plan is a comprehensive strategy designed to help individuals or businesses achieve specific financial goals, both short and long-term. Financial planning covers aspects such as budgeting, investments, savings, taxes, and retirement planning.
Gross earnings refer to an employee's salary or wages before any deductions for taxes, Social Security, and employee benefit contributions are made.
Gross Income refers to the total earnings from all sources before any deductions or taxes. It encompasses income from employment, self-employment, rental property, alimony, child support, public assistance payments, and retirement benefits.
A part of the Earned Income Credit that is based on health insurance premiums that provide coverage for one or more qualifying children.
Local taxation is a form of taxation levied by a local government authority rather than by central government. In the UK, council tax and business rates are the main forms of local taxation.
A term used in finance to denote secured rates of return, commodities positions in static markets, and investor withholding due to tax implications.
Net yield is the return on an investment after all expenses, taxes, and costs have been subtracted. It provides a more accurate measure of an investment's profitability than gross yield.
A payroll deduction refers to the reduction of the amounts paid to a worker from their gross earnings to cover various costs, such as taxes, savings, pension contributions, union dues, and insurance premiums. The paycheck reflects the gross pay minus these deductions.
PITI is an acronym representing the four primary components that make up a borrower's monthly mortgage payments: Principal, Interest, Taxes, and Insurance. Understanding PITI is crucial for both lenders and borrowers to ensure accurate financial planning and loan repayment.
Property management involves the operation of real estate as a business, including activities such as rental, rent collection, maintenance, and numerous other tasks related to the ownership and oversight of properties.
Return can have varied meanings in different contexts, including finance, investment, retailing, taxes, and trade. Generally, it refers to profits, exchanges, and refunds or credits, often associated with securities, merchandise, or taxpayer information.
Self-employment income refers to the earnings generated by individuals who work for themselves rather than being employed by a company or organization. This income is subject to Social Security taxes if the net profit from the trade or business is at least $400 for the year. In some cases, earnings less than $400 might still be considered for Social Security purposes.
Stamp Duty Reserve Tax (SDRT) is a tax on electronic paperless transactions of UK shares, debenture stock, and other securities. SDRT is charged at a rate of 0.5% of the transaction's value.
Take-home pay is the amount of wages a worker actually receives after all deductions, including taxes, have been made from their gross income.
A tax voucher is a document provided by an organization, typically to its shareholders, that outlines details of the dividend income and any associated tax credits. It assists in accurately reporting income for tax purposes.
Underestimation in the context of taxation occurs when taxpayers pay less tax than they owe, which can lead to underpayment penalties and is often linked to terms such as underpayment penalty and underwithholding.
Unearned income or revenue is income received by a business but not yet earned. It is typically classified as a current liability on a company's balance sheet.
A financial statement displaying the wealth created by a company through the collective efforts of capital, employees, and others, along with its allocation over an accounting period.
Withholding refers to the portion of an employee's wages retained by the employer for the purpose of paying various taxes, insurance plans, pension plans, union dues, and other deductions.
