Tax Glossary

A loss from the worthlessness of a debt.

The amount owed to the IRS after subtracting total tax payments from the total tax liability on a tax return.

Any person or an organization with members or clients that contract with each other (or with the barter exchange), who jointly trades or barters property or services.

An exchange or property or services.

The amount of an individual's investment in property for tax purposes.

A person designated to receive all or a portion of a benefit after the owner dies.

Cash or fair market value of unlike property received in an exchange.

A business bad debt that is either of the following: created or acquired in the taxpayer's trade or business or closely related to the taxpayer's trade or business when it became partly or totally worthless (a debt is closely related to the taxpayer's trade or business if the taxpayer's primary motive for incurring the debt is business related).

The intangible value of technical manuals; training manuals or programs; data files; accounting or inventory control systems; customer lists; subscription lists; insurance expirations; patient or client files; and lists of newspaper, magazine, radio, and television advertisers.

Costs that do not have to be capitalized or included in the cost of goods sold. To be deductible, business expenses must be both ordinary and necessary.