H&R Block Tax Term questions and
answers
adjusted gross income AGI✔✔gross income less reductions that are allowable,
regardless of whether personal deductions are itemized.
deductions✔✔amounts that may be subtracted from income that is otherwise
taxable.
earned income✔✔income from personal services as distinguished from
income generated by property or other sources. earned income includes all
amounts received as wages, tips, bonuses, other employee compensation, and
self-employment income, whether in the form of money, services, or property.
federal income tax withheld✔✔The amount taken out of income by the payer
and submitted to the IRS as an advanced payment of the taxpayers federal
income tax.
gross income✔✔total worldwide income received in the form of money,
property, or services that is subject to tax.
Medicare part A✔✔Medicare insurance for individuals who are age 65 or older
or disabled. Medicare part A covers hospital expenses, care in skilled nursing
facility, hospice care and some health care. most do not pay a monthly
premium, if they or their spouse paid Medicare taxes while working.
non-refundable credit✔✔A credit which cannot exceed the taxpayers tax
liability.
,social security tax withheld✔✔if a taxpayer worked for more than one
employer during 2019, and more than $8,329.80 was withheld for social
security tax, the excess over the maximum is included in the payments section
of the return. The excess amount has the same character as withholding tax.
social security wages✔✔Total wages paid to an employee that are subject to
this tax. This amount does not include tips. Wages are also subject to Medicare
Tax.
tax liability✔✔The amount of total tax due to the IRS after any credits and
before taking into account any advanced payments (withholding, estimated
payments, ect.) made by the taxpayer.
taxable income✔✔Adjusted gross income, less itemized deductions or the
standard deduction, less the qualified business income deduction, if applicable.
this term is also used to refer to income that is not exempt or excluded from
taxation. example wages equals taxable gifts equal non-taxable.
unearned income✔✔taxable income other than that received for services
performed (earned income). unearned income includes money received for the
investment of money or other property, such as interest, dividends, and
royalties. it also includes pensions, alimony, unemployment compensation,
and other income that is not earned.
resident alien✔✔a citizen of another country who lives in the US and or has a
resident status by law or visa or passes the substantial presence test. (1040)
non-resident alien✔✔A person who is not a US citizen and does not live in the
US or lives in the US under a non-resident visa or does not meet the substantial
presence test. (1040NR)
, schedules✔✔official IRS forms to report various types of income, deductions,
and/or credits.
statements✔✔explanations of various types of income, deductions, and/or
credits reported on a schedule or directly on a 1040 form. statements may or
may not be official IRS forms.
AGI✔✔adjusted gross income
QBI✔✔qualified business income
PTIN✔✔prepare tax identification number
community income✔✔Income of a married couple, living in a community
property state, that is considered to belong equally to each spouse, regardless
of which spouse receives the income.
community property✔✔Property considered to belong in equal shares to a
husband and wife. This concept of ownership for property acquired after
marriage is followed in Arizona, California, Idaho, Louisiana, New Mexico,
Nevada, Texas, Washington, and Wisconsin.
dependent✔✔An individual who may be claimed on another person's income
tax return. To be claimed as a dependent, a person must meet the qualifying
child or qualifying relative test
gross income✔✔Total worldwide income received in the form of money,
property, or services that is subject to tax.
answers
adjusted gross income AGI✔✔gross income less reductions that are allowable,
regardless of whether personal deductions are itemized.
deductions✔✔amounts that may be subtracted from income that is otherwise
taxable.
earned income✔✔income from personal services as distinguished from
income generated by property or other sources. earned income includes all
amounts received as wages, tips, bonuses, other employee compensation, and
self-employment income, whether in the form of money, services, or property.
federal income tax withheld✔✔The amount taken out of income by the payer
and submitted to the IRS as an advanced payment of the taxpayers federal
income tax.
gross income✔✔total worldwide income received in the form of money,
property, or services that is subject to tax.
Medicare part A✔✔Medicare insurance for individuals who are age 65 or older
or disabled. Medicare part A covers hospital expenses, care in skilled nursing
facility, hospice care and some health care. most do not pay a monthly
premium, if they or their spouse paid Medicare taxes while working.
non-refundable credit✔✔A credit which cannot exceed the taxpayers tax
liability.
,social security tax withheld✔✔if a taxpayer worked for more than one
employer during 2019, and more than $8,329.80 was withheld for social
security tax, the excess over the maximum is included in the payments section
of the return. The excess amount has the same character as withholding tax.
social security wages✔✔Total wages paid to an employee that are subject to
this tax. This amount does not include tips. Wages are also subject to Medicare
Tax.
tax liability✔✔The amount of total tax due to the IRS after any credits and
before taking into account any advanced payments (withholding, estimated
payments, ect.) made by the taxpayer.
taxable income✔✔Adjusted gross income, less itemized deductions or the
standard deduction, less the qualified business income deduction, if applicable.
this term is also used to refer to income that is not exempt or excluded from
taxation. example wages equals taxable gifts equal non-taxable.
unearned income✔✔taxable income other than that received for services
performed (earned income). unearned income includes money received for the
investment of money or other property, such as interest, dividends, and
royalties. it also includes pensions, alimony, unemployment compensation,
and other income that is not earned.
resident alien✔✔a citizen of another country who lives in the US and or has a
resident status by law or visa or passes the substantial presence test. (1040)
non-resident alien✔✔A person who is not a US citizen and does not live in the
US or lives in the US under a non-resident visa or does not meet the substantial
presence test. (1040NR)
, schedules✔✔official IRS forms to report various types of income, deductions,
and/or credits.
statements✔✔explanations of various types of income, deductions, and/or
credits reported on a schedule or directly on a 1040 form. statements may or
may not be official IRS forms.
AGI✔✔adjusted gross income
QBI✔✔qualified business income
PTIN✔✔prepare tax identification number
community income✔✔Income of a married couple, living in a community
property state, that is considered to belong equally to each spouse, regardless
of which spouse receives the income.
community property✔✔Property considered to belong in equal shares to a
husband and wife. This concept of ownership for property acquired after
marriage is followed in Arizona, California, Idaho, Louisiana, New Mexico,
Nevada, Texas, Washington, and Wisconsin.
dependent✔✔An individual who may be claimed on another person's income
tax return. To be claimed as a dependent, a person must meet the qualifying
child or qualifying relative test
gross income✔✔Total worldwide income received in the form of money,
property, or services that is subject to tax.
