All Legal Terms by letter T

Tacking :- Refers to the joining together of successive time periods such that someone can claim the entire period applies. For example, in adverse possession cases, the present possessor may be able to add the time spent in possession by the prior possessor in order to add the time periods together.

Tail :- In real property law, a Tail refers to the limitation found in deeds that describes or limits those who can inherit the property. For example, a "tail male" limits the inheritance to male heirs, and a "tail female" is a limitation to female heirs. A "tail general" is simply a limitation to heirs of the person.

Taking :- In condemnation practice, this is the actual wresting of ownership in land from an individual to the government, for some public purpose.

Tangible Asset :- Tangible assets are assets with actual physical existence, such as property, cash, equipment, etc. Tangible assets are distinguishable from intangible assets, such as goodwill.

Tangible Property :- The class of property that has a physical form that can be described objectively. Tangible personal property can be weighed, measured, counted, etc.

Tariff :- A tax that is imposed on the import or export of goods into a country. This is an indirect tax and the cost of the goods ultimately includes the tax. Since it is embedded in the price, the tax paid by the consumer is not deductible.

Taxable :- An item or situation resulting in gain that is subject to the imposition of a tax or to taxation by a government.

Taxable Income :- Taxable income is the taxpayer's adjusted gross income minus all allowable tax deductions. This taxable income amount is the figure used to calculate actual tax owed. Examples of allowable deductions for an individual taxpayer are state and local tax expense, charitable contributions, and home mortgage interest. Finding all the allowable deductions is the job of every tax planner.

Tax Attorney:- Most lawyers will specialize into certain areas of interest during their careers. Those few that venture into tax practice are usually highly skilled and well versed in both tax law and tax accounting. Tax law is detailed intensive and a meticulous practice. A tax attorney can be very helpful when contesting a tax lien, a tax arrearage, a tax penalty, and is essential in cases of a criminal charge for a violation of the tax code.

Tax Audit :- A tax audit is an investigation conducted by the internal revenue service done to determine whether the taxpayer has paid the correct amount in tax. Some tax audits are triggered by IRS computers detecting an unusual amount of deductions or unreasonably low income. Some audits are random. The tax audit itself may be an informal matter but it can be greatly detailed and intrusive.

Tax Avoidance:- This is what privately employed tax lawyers are best employed to do: avoiding tax by taking full and complete advantage of all legally available tax planning opportunities. If you go over the line, it is called tax evasion. For a more complete summary on this term please see the article at Legal Term Topics and Issues - Income Tax Law.
Tax Basis :- The value assigned to a taxpayer's investment in particular property. This amount is used to compute the gain or loss from the transfer of the property and is called the taxpayer's tax basis in the property.

Tax Bracket :- The US uses a graduated tax system where tax rates increase as does taxable income. As a person goes from stage to stage on the tax scale, they are going from one tax bracket to another. For a more complete summary on this term please see the article at Legal Term Topics and Issues - Income Tax Law.

Internal Revenue Code :- The Internal Revenue Code, sometimes called the tax code, is the large body of statutes and regulations that make up the United States Tax law. Each time a tax law is changed it becomes part of the body of the Internal Revenue Code. While large and complicated, it can be navigated by the persistent and the patient.

Credit (Tax Credit) :- A tax credit is a dollar-for-dollar reduction in the amount of actual tax liability for a taxpayer. Tax credits are allowed for certain low-income persons, and persons adopting a child, among others. Tax credits need to be distinguished from tax deductions, which are not dollar-for-dollar. Tax deductions reduce the amount of taxable income while tax credits reduce the amount of tax payable.

Tax Deduction :- A tax deduction is any allowable expense that may be subtracted from the taxpayer's adjusted gross income to calculate the amount of actual taxable income. Examples of allowable deductions for an individual taxpayer are state and local tax expense, charitable contributions, and home mortgage interest. Finding all the allowable deductions is the job of every tax planner.

Tax Deferred :- Present income that is taxable, but under the provisions of a particular regulation or tax code provision, may be postponed to be taxed in the future. For example, income presently taxable may be put into various special retirement accounts and may not be subject to tax until withdrawn (presumably at a lower rate when the taxpayer has retired). For a more complete summary on this term please see the article at Legal Term Topics and Issues - Income Tax Law.

Tax Evasion :- The intentional attempt to not pay a tax otherwise due by using tax planning devices and schemes to circumvent the tax code. Tax evasion is a crime and has both civil and criminal penalties. For a more complete summary on this term please see the article at Legal Term Topics and Issues - Income Tax Law.

Tax Exempt :- Something that is not subject to a tax, such as churches and interest on municipal bonds.

Tax Haven :- A Tax Haven is really a slang term meant to identify particular countries that will offer businesses and individuals a place to deposit assets with little or no tax consequence. In addition, there is little to no regulation in a tax haven. Privacy is also greatly protected. Some island nations in the Caribbean are well known tax havens used my many sophisticated investors.
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Tax Law :- The area of law practice dealing with the internal revenue code and taxation issues. Tax lawyers find employment in many areas, from prosecution of white collar crime, to corporation, finance, accounting, and securities law. For a more complete summary on this term please see the article at Legal Term Topics and Issues - Income Tax Law.

Tax Liability :- The amount of unpaid taxes due, or the amount of tax that is owed after taking all allowable deductions and credits. For a more complete summary on this term please see the article at Legal Term Topics and Issues - Income Tax Law.

Federal Tax Lien :- An unpaid tax liability owed to the Federal Government may be filed as a lien on the real property owned by the delinquent taxpayer. The effect of the Federal Tax Lien is to encumber the property and make it impossible to sell the real estate without first taking care of the lien from the sale proceeds. Unlike a judgment lien, a Federal Tax Lien can be imposed prior to a court ruling. Federal Tax Liens are a very powerful IRS enforcement tool .