Deduction

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Deduction

That which is deducted; the part taken away; abatement; as in deductions from gross income in arriving at net income for tax purposes.

In Civil Law, a portion or thing that an heir has a right to take from the mass of the succession before any partition takes place.

A contribution to a charity can be used as a deduction to reduce income for Income Tax purposes if the taxpayer meets the requirements imposed by law.

West's Encyclopedia of American Law, edition 2. Copyright 2008 The Gale Group, Inc. All rights reserved.

deduction

n. an expenditure which an income tax payer may subtract from gross (total) income to determine taxable income. This is not the same as an exemption which is for one's marital status, age over 65, blindness and number of dependents (e.g. children), which, added together, reduce the tax owed.

Copyright © 1981-2005 by Gerald N. Hill and Kathleen T. Hill. All Right reserved.
References in periodicals archive ?
A factory worker, who declined to be named, said: 'My wages were not deducted for the two days when I went to vote.
3) Fees deducted from an IRA are not tax deductible on IRS Form 1040; Schedule A (i.e., itemized deductions).
Even when a contract does exist, however, it is not clear that advance payments may be deducted in the year of payment if, for example, monthly payment options are available.
(5) She cannot deduct these medical expenses because 7.5 percent of adjusted gross income (exclusion) is $2,694.
94-12 (which deals with the treatment of incidental repairs), the IRS confirmed that INDOPCO did not "change the fundamental legal principles for determining whether a particular expenditure can be deducted." Similar guidance was provided in respect of advertising expenditures (in Rev.
By so doing, they could easily jeopardize their eligibility to deduct forestry expenditures.
The shareholder can only deduct the health insurance as an itemized deduction subject to the 7.5% adjusted-gross-income limit.
Thus, for a taxpayer to currently deduct employment taxes on accrued vacation/bonus pay that is paid in the subsequent year, it must meet the all events test and economic performance must have occurred with respect to the liability.
Shareholders who lend money to an S corporation can deduct losses in excess of the stock basis.
This means you can deduct $15,000 for a $45,000 piece of equipment, then depreciate the remaining $30,000 as you normally would.
69-21 supplies taxpayers an alternative method (apart from section 162) under which they may deduct expenditures to remedy year-2000 software problems.
* A self-employed individual can deduct 25 percent of his/her medical insurance as a deduction to adjusted gross income.