Tag: TERM

Protective Tariff A tax levied on imported goods with the purpose of reducing domestic consumption of foreign-produced goods.

Proportional Tax A tax that takes the same percentage of income from all income groups.

Property Taxes Taxes on property, especially real estate, but also can be on boats, automobiles (often paid along with license fees), recreational vehicles, and business inventories.

Progressive Tax A tax that takes a larger percentage of income from high-income groups than from low-income groups.

Personal Identification Number (PIN) Allow taxpayers to “sign” their tax returns electronically. The PIN, a five-digit self-selected number, ensures that electronically submitted tax returns are authentic. Most taxpayers can qualify to use a PIN.

Personal Exemption Can be claimed for the taxpayer and spouse. Each personal exemption reduces the income subject to tax by the exemption amount.

Payroll Taxes Include Social Security and Medicare taxes.

Nullification A state’s refusal to recognize or obey a federal law.

Nonrefundable Credit When the amount of a credit is greater than the tax owed, taxpayers can only reduce their tax to zero; they cannot receive a “refund” for any excess nonrefundable credit.

Medicare Tax Used to provide medical benefits for certain individuals when they reach age 65. Workers, retired workers, and the spouses of workers and retired workers are eligible to receive Medicare benefits upon reaching age 65.