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Today's Terms
Federal income tax
Definition:
The federal government levies a tax on personal income. The federal income tax provides for national programs such as defense, foreign affairs, law enforcement, and interest on the national debt.
Subchapter S
Definition:
The S-Corporation must complete and file IRS Form 1120s to report its annual income to the IRS each year.
Dependency exemption
Definition:
Amount that taxpayers can claim for their eligible dependents. Each exemption reduces the income subject to tax. The exemption amount is a set amount that changes from year to year.
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