Law Dictionary Definitions

A tax credit against U.S. income taxes for a taxpayer who earns income overseas and has paid foreign taxes on that income. See FOREIGN-EARNED-INCOME EXCLUSIONN. [Cases: Internal Revenue 4098. C.J.S. Internal Revenue § 481.] “Since direct foreign investments and business operations of United States persons often attract foreign income taxes along with the baseline U.S.…

A refundable federal tax credit on the earned income of a low-income worker with dependent children. • The credit is paid to the taxpayer even if it exceeds the total tax liability. [Cases: Internal Revenue 3532. C.J.S. Internal Revenue § 346.] [Blacks Law 8th]

tax credit.An amount subtracted directly from one’s total tax liability, dollar for dollar, as opposed to a deduction from gross income. — Often shortened to credit. Cf. DEDUCTION(2). [Cases: Internal Revenue 3520–3537; Taxation 1047. C.J.S. Internal Revenue §§ 58, 336–357, 489–492; Taxation § 1758.] child- and dependent-care tax credit.A tax credit available to a person…

Tax Court, U.S. A federal court that hears appeals by taxpayers from adverse IRS decisions about tax deficiencies. • The Tax Court was created in 1942, replacing the Board of Tax Appeals. — Abbr. T.C. [Cases: Internal Revenue 4645–4655. C.J.S. Internal Revenue §§ 680–687.] [Blacks Law 8th]

tax court. 1.TAX COURT, U.S.2. In some states, a court that hears appeals in nonfederal tax cases and can modify or change any valuation, assessment, classification, tax, or final order that is appealed. [Cases: Taxation 492.6, 1085.5, 1318.5. C.J.S. Taxation §§ 729, 1770–1772, 2048–2054.] [Blacks Law 8th]

tax certificate.An instrument issued to the buyer of property at a tax sale, certifying the sale and entitling the buyer to a tax deed and possession of the property upon the expiration of the redemption period. • If the property is redeemed, the tax certificate is voided. See REDEMPTION PERIOD; tax sale under SALE. Cf.…

tax bracket.A categorized level of income subject to a particular tax rate under federal or state law . [Cases: Internal Revenue 3545–3552; Taxation 1061–1065. C.J.S. Internal Revenue §§ 331–333, 335, 358–361, 797; Taxation § 1698.] [Blacks Law 8th]

tax-benefit rule.The principle that if a taxpayer recovers a loss or expense that was deducted in a previous year, the recovery must be included in the current year’s gross income to the extent that it was previously deducted. — Also termed tax-benefit doctrine. [Cases: Internal Revenue 3089, 3138. C.J.S. Internal Revenue § 78.] [Blacks Law…

tax basis.See BASIS(2). [Blacks Law 8th]

tax base.The total property, income, or wealth subject to taxation in a given jurisdiction; the aggregate value of the property being taxed by a particular tax. Cf. BASIS(2). [Blacks Law 8th]