Schedule A —
An IRS form you would use to calculate and describe the itemized tax-deductible expenses on your income tax as opposed to standardized deductions.
Schedule C —
When you have an unincorporated business and are a sole proprietor of the business, you are required to file taxes on Schedule C attached to Form 1040. Schedule C allows a business owner to deduct expenses incurred during the tax year they conducted business from their gross income. As a Schedule C taxpayer, you are required to pay half of your Self-Employment tax since you are self-employed.
Schedule D —
When you make a profit or take a loss from a sale of an asset, this is called respectively a capital gains or a capital loss. The IRS provides the Schedule D for you to report your capital gains and losses.
Schedule E —
When you have additional income or a financial loss from a trust, estate, real estate rental, royalties, an S-Corporation, or Partnership, this income or loss should be reported on the IRS form called a Schedule E.
Schedule K-1 —
Within a partnership, each partner uses the Schedule K-1 to report his or her share of the income, credits, and deductions. This form is not filed with IRS; it is for record keeping only and is a requirement. Even though partnerships are not generally subject to income tax, each individual partner is liable for tax on their share of the partnership income.
Secured Loan —
A loan in which you as the borrower pledge an asset you own as collateral for the repayment of the loan.
Self-Employment —
Simply when you work for yourself, when you decide your work schedule, and when you obtain your own jobs and make your own sales. You then receive social security and Medicare coverage through the payment of the Federal self-employment tax.
Self Employment Tax —
The Social Security and Medicare tax for people who are self-employed is called the self-employment tax. When an individual pays this tax, they are contributing to their coverage under the social security system. As opposed to wage earners who have social security taxes taken from their wages, an individual must pay self-employment tax if their net earnings from self-employment are $400 or more.
Social Security Number —
If you are an American citizen, this is your taxpayer identification number.
Status 53 —
Also referred to as Currently Non-Collectible or CNC, status 53 allows you to make no monthly payments to their delinquent tax debt due to minimal income below Federal standards to provide for yourself and your family. The IRS reviews status 53 on a regular basis and your status can be changed back to “Collectible” if there is a change in the client’s financial situation. While designated as being under Status 53, the penalties and interest on your tax liability continue to accrue.
Statute of Limitation —
The specific time periods set by the IRS for the expiration of certain actions that can be taken to collect a tax, assess a tax account, request a refund, or file bankruptcy. The current statute of limitation for IRS collection and collection actions is 10 years from the date of assessment. The IRS, however, can extend the statute when the taxpayer has taken certain actions.
Streamlined Installment Agreement —
A monthly payment plan with the IRS to cover your back tax debt that does not require you to disclose your financial information. Since a Streamlined Installment Agreement does not require the approval of an IRS manager, it is one of the fastest of all the IRS tax debt solutions. Such an agreement is available only if you meet the following requirements: 1) your tax liability is less than $25,000, and 2) the monthly payment will cover the total amount of the tax liability in under five years or before the statute of limitations on the debt expires.
Subordination of Federal Tax Lien —
The legal process when the IRS subordinates a Federal Tax Lien to a third party, temporarily setting aside the lien to enable a refinance or sale of a piece of property. Such a decision of subordination is made only if the IRS believes it will further the repayment of a tax debt and help close a delinquent account.
Substitute for Return —
The SFR law actually allows the IRS to take the income reported under your SSN and file a tax return for you. Ignoring any deductions or dependents, this by-the-numbers return is designed to assess the highest amount of tax possible for the IRS. In addition, since you failed to file your own return, the tax period remains open indefinitely for possible future assessment.
