What is an Overhead Expense?

We work with small business owners and entrepreneurs. Some are seasoned, others are just growing their side hustle. Their skills are varied and they have a wide variety of talents. We often get asked to explain the ins and outs of financial reports and have found that providing our favorite clients with a working knowledge … Continued

What Are Costs of Goods Sold?

We work with small business owners and entrepreneurs. Some are seasoned, others are just growing their side hustle. Their skills are varied and they have a wide variety of talents. We often get asked to explain the ins and outs of financial reports and have found that providing our favorite clients with a working knowledge … Continued

What Are Operating Costs?

We work with small business owners and entrepreneurs. Some are seasoned, others are just growing their side hustle. Their skills are varied and they have a wide variety of talents. We often get asked to explain the ins and outs of financial reports and have found that providing our favorite clients with a working knowledge … Continued

What is the Widow’s Exemption?

What is the Widow’s Exemption? The widow’s exemption reduces the tax burden on widows by reducing the amount of a widow’s taxable income. States individually determine the widow’s exemption rules and laws for themselves. It is not a federal exemption. Most commonly, the widow’s exemption effects the state inheritance taxes. When one spouse dies, he … Continued

What is Underwithholding?

What is Underwithholding? Underwithholding is when you haven’t had enough income taxes withheld during a year. If a tax payer’s incomes taxes are underwithheld, it does not mean that tax payers doesn’t have to pay the taxes. Tax payers pay the underwithheld taxes when he or she files a tax return. The withholding amount is determined by how … Continued

What is a Tax Credit?

What is a Tax Credit? A tax credit reduces the amount of tax a business or individual has to pay. The government uses tax credits to encourage or reward behavior that they find beneficial. For example, the government can give a tax credit to people for replacing old appliances with new, energy efficient ones. Most tax … Continued

What is Sales Tax?

What is Sales Tax? Sales tax is a consumption tax on goods and services. State governments, along with county and local governments, set the sales tax; however, not every state has sales tax. The purpose of sales tax is to fund government projects. The revenues from sales tax are used to fix roads, improve communities, … Continued

What is the Rehabilitation Tax Credit?

What is the Rehabilitation Tax Credit? The rehabilitation tax credit is a federal tax credit that encourages real estate developers to renovate or restore older buildings. Buildings built before 1936 are the target of the rehabilitation tax credit. Any renovations made on buildings from 1936 or earlier are eligible for a 10% tax credit. Any … Continued

What are Pretax Earnings?

What are Pretax Earnings? Pretax earnings can be applied to individuals or businesses. In each case, pretax earnings refer to the amount of money an individual or business earns before income tax is taken out. Pretax earnings are also referred to as pretax income or earnings before tax. In order to determine the pretax earnings for … Continued

Glossary: Accounting & Tax Terms

This glossary of accounting & tax terms will hep you understand basic accounting vocabulary. Click on any of the terms for a expanded definition and examples. Accounting & Tax Terms After-tax income: The amount of disposable income that a person or company has left over after all federal, state and withholding taxes have been deducted … Continued