Retirement Plans
A tax-deferred retirement plan account that provides some tax advantages for retirement savings in the United States.
individual retirement account (IRA)
A tax imposed by the federal government on any money earned during a fiscal year.
Income tax
All of the property, assets, and debts left by a deceased person.
Estate
A word that describes someone who dies without a legal will in place.
intestate
Income that is available after all necessities (food, shelter, etc.) have been paid for.
Discretionary Income
A company retirement plan, such as a 401(k) plan or 403(b) plan, in which the employee elects to defer some amount of his or her salary into the plan, and he or she bears the investment risk
defined contribution plan
A tax imposed on the transfer of property from a deceased person.
inheritance tax
The act of preparing for passing assets and decision-making responsibility on to heirs or other individuals in case of death or incapacitating injury or illness.
estate planning
An authorization to act on someone else's behalf in a legal or business matter. The person authorizing the other to act is the principal or granter (of the power), and the one authorized to act is the agent or attorney-in-fact.
power of attorney
A social insurance program funded through dedicated payroll taxes called the Federal Insurance Contributions Act (FICA)
Social Security
An individual retirement account that provides tax-free growth, with contributions to the account made post-tax. ____ may be opened through various investment options, including stocks or mutual funds.
Roth IRA
A form of taxation where people who earn more are charged a higher percentage of their income than people with lower incomes.
progressive taxes
A name given to various taxes that arise on the death of an individual, also called inheritance tax or death duty.
Estate tax
A legal arrangement in which one person holds title to money or property, subject to an obligation to keep or use the property for the benefit of another.
trust
A specific power of attorney that allows an agent to make health care decisions in the event that the primary individual is incapable of executing such decisions.
health care proxy
A type of employer-sponsored defined contribution retirement plan under section ___ of the Internal Revenue Code. It allows a worker to save for retirement while deferring income taxes on the saved money and earnings until withdrawal. The employee elects to have a portion of wages paid directly, or deferred, into the account.
401(k)
A tax paid by owners of property, based on the estimate of the property's value.
Property tax
A person tasked with carrying out the instructions laid out in the will. The executor's most common task is to guide the decedent's assets throughout the probate process. If there is no will, or if the will does not name an _____, the probate or other court can appoint one.
executor
A document by which a person regulates the rights of others over his or her property or family after death.
Will
The divisions at which tax rates change in a progressive tax system. Income past a certain point will be taxed at a higher rate.
tax brackets
A company retirement plan, such as a pension plan, in which a retired employee receives a specific amount based on salary history and years of service, and in which the employer bears the investment risk. Contributions may be made by the employee, the employer, or both.
defined benefit plan
Amounts subtracted directly from the taxes due, not from income as deductions are. There are many types of _____, including the Earned Income Tax Credit and the Child Tax Credit.
Tax credits
A dollar-value threshold over which estate taxes are required.
Exemption amount
The legal process of settling the estate of a deceased person, resolving all claims and distributing the decedent's property.
probate
Amounts subtracted directly from the taxes due, not from income as deductions are. There are many types of tax credits, including the Earned Income Tax Credit and the Child Tax Credit.
tax credits