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Compulsory payroll tax
An automatic tax collected from employers and employees to finance specific programs.
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.
Dependency exemption
Amount that taxpayers can claim for their eligible dependents. 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.
Dependent
A person, other than the taxpayer or spouse, who entitles the taxpayer to claim a dependency exemption.
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.
Subchapter S
The S-Corporation must complete and file IRS Form 1120s to report its annual income to the IRS each year.
Family daycare providers
A family daycare provider is a person engaged in the business of providing family daycare.
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.
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.
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