What Is a Tax Lien? A tax lien is a legal claim against the assets of an individual or business that fails to pay taxes owed to the government. In general, a lien serves to guarantee payment of a debt such as a loan, or in this case, taxes. If the obligation is not satisfied
Taxable Event: An Overview A taxable event is any action or transaction that may result in taxes owed to the government. Common examples of federal taxable events include receiving a payment of interest and dividends, selling stock shares for a profit, and exercising stock options. Receipt of a paycheck is a taxable event. Understanding the
What Is Taxable Income? Taxable income is the portion of your gross income used to calculate how much tax you owe in a given tax year. It can be described broadly as adjusted gross income (AGI) minus allowable itemized or standard deductions. Taxable income includes wages, salaries, bonuses, and tips, as well as investment income and various
What are Taxable Preferred Securities? Taxable preferred securities refers to preferred stock whose dividend payments are not exempt from taxation. Key Takeaways Taxable preferred securities refers to preferred stock whose dividend payments are not exempt from taxation.Taxable preferred securities are usually junior level liabilities, and the coupons tied to them can either be fixed or
What Is the Taxable Wage Base? The term taxable base refers to the maximum amount of earned income on which employees must pay Social Security taxes. The employee’s gross wages are generally equal to the taxable wage base. An employer typically handles this calculation and withholds the correct amount of taxes from each of the
What Is a Tax Advisor? A tax advisor is a financial expert with advanced training and knowledge of tax accounting and tax law. The services of a tax advisor are usually retained in order to minimize taxes payable while remaining compliant with the law in complicated financial situations. Tax advisors can include Certified Public Accounts
What Does Tax And Price Index Mean? The tax and price index (TPI) is a measure of the percentage that a consumer’s income must rise in order for them to maintain the same level of purchasing power. The tax and price index (TPI) takes into account changes in retail prices due to inflation, as well
What Is Tax Arbitrage? Tax arbitrage is the practice of profiting from differences that arise from the ways various types of income, capital gains, and transactions are taxed. The complexity of many countries tax codes allows for individuals to seek out legal loopholes or restructure their transactions in such a way that they are able
What Is Taxation? Taxation is a term for when a taxing authority, usually a government, levies or imposes a financial obligation on its citizens or residents. Paying taxes to governments or officials has been a mainstay of civilization since ancient times. The term “taxation” applies to all types of involuntary levies, from income to capital gains to
What Is a Tax Attribute? Tax attribute refers to certain losses, tax credits, and the adjusted basis of property that must be reduced because of the exclusion of debt cancellation from a taxpayer’s gross income. Tax attributes are adjusted when a taxpayer is insolvent or declares bankruptcy. Key Takeaways Tax attributes are specific economic benefits
