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Tax Vocabulary
IRS Forms
Business Structures
Sales & Use Taxes
Gift & Estate Taxes
100

A reduction in the amount of money you need to pay.

What is a DEDUCTION

100
Used for a small business to register as an S Corporation rather than the default C Corporation.

What is IRS FORM 2553

100
Single owner of an unincorporated business who takes on all the responsibilities, including profits and debts, of that company.

What is SOLE PROPRIETOR

100

A consumption tax imposed by the government on the sale of goods and services.

What is SALES TAX

100

Federal tax applied to an individual giving anything of value to another person.

What is GIFT TAX

200

Municipal tax levied by counties, cities, or special tax districts on most types of real estate.

What is PROPERTY TAX

200
Informational form used to report partners share of income, deductions, credits, etc.

What is IRS FORM 1065 (SCHEDULE K-1)

200

Consists of two or more people, or other entities, who contribute money and property to start a business.

What is a PARTNERSHIP

200

Sales tax that state governments impose on consumers who do not pay sales tax at the time of purchase.

What is USE TAX

200

 Tax on your right to transfer property at your death.

What is an ESTATE TAX
300
A unique identification number that is assigned to a business entity so it can be easily identified by the IRS.
What is an EMPLOYER IDENTIFICATION NUMBER (EIN)
300

Form used by an executor of a decedent's estate to calculate estate tax owed.

What is IRS FORM 706

300
Hybrid between a partnership and an LLC.
What is a LIMITED LIABILITY PARTNERSHIP (LLP)
300

Tax that is usually collected from sales of motor fuel, tobacco, airline tickets, alcohol, and other goods and services. 

What is EXCISE TAX

300
An additional tax on top of the estate or gift tax on the property given to a "skip" person.

What is GENERATION-SKIPPING TRANSFER TAX (GST)

400

Legal business entity that passes any income made straight to owners, shareholders, or investors.

What is FLOW-THROUGH ENTITY
400
Form used to report transfers subject to the federal gift and certain generation-skipping transfer (GST) taxes.

What is IRS FORM 709

400

Donations to these organizations are tax-deductible for donors.

What is a 501(c)(3) NON-PROFIT

400
Type of state where each sale is considered to take place in the jurisdiction where the product is ultimately used-where it's shipped to or picked up from.

What is DESTINATION-BASED TAX STATE

400

Paid by the person receiving the property and vary depending on how the heir was related to the deceased.

What is INHERITANCE TAXES

500
Certain amount of assets that each person is allowed to gift to other parties without having to pay gift, estate, or generation skipping transfer taxes.

What is UNIFIED TAX CREDIT

500
An S Corporation reports activity on this IRS form.

What is IRS FORM 1120-S

500
Hybrid entities that combine the characteristics of a corporation with those of a partnership or sole proprietorship.

What is a LIMITED LIABILITY COMPANY (LLC)

500

Type of state where sales tax is collected based on the seller's location.

What is ORIGIN-BASED TAX STATE

500

Occurs when the value of property reported on IRS form 706 is 65% or less of the actual value of the property.

What is VALUATION UNDERSTATEMENT