This Glossary provides a helpful list of definitions, some of which are unique to this program and others that are IRS-defined.
Acknowledgment A message from the IRS or the State Agency that a Return has been accepted via electronic filing.
Adjust Gross income (AGI) This amount is the Taxpayer`s total income reduced by certain deductions, such as contributions made to an IRA, student loan interest payments and other available deductions.
Adjustments to Income This amount is the Taxpayer`s total deductions that are subtracted from gross income to calculate Adjusted Gross Income (AGI). These include, but are not limited to, deductions for moving expenses, alimony paid, a penalty on early withdrawal of savings, and contributions to an individual retirement arrangement (IRA). Adjustments to income can be subtracted from gross income even if itemized deductions are not available or claimed.
Amount Due This is the amount the Taxpayer owes to the IRS when the total tax due for the year is greater than the total tax payments already made for the year.
Asset Any item of economic value owned by an individual or corporation which must be depreciated for tax purposes.
Audits These functions are used to configure the diagnostic validations.
Bank This is the Bank you have chosen to process your bank products related to Tax Returns. This is independent of a Client`s bank where a direct deposit might be made or the bank where you conduct normal bank business.
Bank Product A loan product purchased from the Bank enabling the Taxpayer to receive their tax refund earlier than would be provided by the IRS.
Basis The Basis is the amount of the taxpayer`s monetary investment for tax purposes in real or personal property used for business. The Basis is normally cost, however it could be different depending on how and when the property was purchased, and if the property is used for both business and personal purposes. Basis is used to determine the amount of expense available for the current year from depreciation (regular and special) and Section 179, and to calculate a taxable gain or loss on the sale or other disposition of the property.
Bulletins Messages received from Central Site during communications containing important, recently released information for all Tax Preparers.
Care Provider A person or entity who provides care for an individual and whose income can be expensed by the Taxpayer who makes the payments of income.
Central Site This is the home base where all communications between the Tax Preparer and the IRS and State Agencies take place. This is also how Remote offices communicate with their Main office.
Child and Dependent Care Credit This is a nonrefundable credit available to certain taxpayers to claim a credit for paying someone to care for their qualifying Dependents under the age of 13 or Spouses or dependents who are unable to care for themselves.
Client The Client is the person for whom the Preparer is preparing Tax Returns. The Client is interchangeably referred to as the Taxpayer.
Communications The process which occurs during Transmit/Transmission when information is sent to Central Site from the User and information is sent back to the User from Central Site.
Dependent This is a person, other than the Taxpayer or Spouse, who entitles the Taxpayer to claim a dependency exemption.
Depreciation This is a deduction taken for the business use of certain items which lose value over a period of time longer than one year, such as office furniture.
Direct Deposit This is an electronic transfer of a Refund into a Taxpayer`s financial institution account directly from the IRS.
Due Diligence This is a process, which when used in the context of the Earned Income Tax Credit (EITC), refers to requirements that Preparers must follow when preparing returns that involve the EITC.
Donee A Donee is a non-profit organization that is authorized by the federal government to accept tax deductible charitable contributions.
EFIN The Electronic Filing Identification Number assigned to an ERO by the IRS used for identity purposes when a Return is electronically filed.
EIC The Earned Income Tax Credit or Earned Income Credit is a refundable tax credit available to some taxpayers.
EIN The Employer Identification Number, also known as the Federal Employer Identification Number (FEIN) is assigned to all businesses who hire employees, pay wages, and deposit employment taxes to the IRS on behalf of those employees.
Electronic Signature Pad This is an electronic device with a touch sensitive LCD screen which allows users to acquire and register a signature or any other physical signature capture device that captures and converts a signature into an electronic format.
Employer/Payer A person or entity who has paid wages to an employee and deposited employment taxes to the IRS on behalf of that employee.
ERO An Electronic Return Originator is a person or entity who has been authorized by the IRS to electronically file Tax Returns and has been assigned an EFIN.
Exemption This is a fixed amount a Taxpayer can claim and subtract from income for his or herself, the spouse, and any eligible Dependents.
Export To move data from this program to an outside program for sorting, formatting, and printing.
Feeder Site Also known as a Remote Computer that will transmit directly to Central Site to communicate with the Main Office or Service Bureau.
Filing Status The Filing Status of the Taxpayer determines the rate at which taxable income is taxed. The five filing statuses are as follows: Single, Married Filing a Joint return, Married Filing a Separate return, Head of Household, and Qualifying Widow(er) with dependent child.
FTIN The Federal Tax Identification Number is synonymous with the TIN, and is generic for any type of Identification number assigned by the IRS for reporting purposes.
Gross Income This amount includes money, goods, services, and property a person receives that must be reported as taxable. This also includes unemployment compensation and certain scholarships. It does not include welfare benefits and nontaxable Social Security benefits.
Import This function moves Returns prepared by other tax programs into this program.
Investment IncomeThis amount includes taxable and tax-exempt interest, dividends, capital gains distributions, and rental income.
Main Office The office in a Multi-Office Organization or Service Bureau that is the administrator of all Remote Offices and has overall control of the operation.
Master User This is the User ID of the Main Office in a Multi-Office Organization or Service Bureau.
MeF This refers to Modernized e-File.
Multi-Tier Office This is a Remote Office of the Main Office that can have other Remote Offices organized under it. Under this system, three tiers are available: The Main Office, Multi-Tier Offices, and Remote Offices which may be assigned to a Multi-Tier Office or the Main Office.
Name Control This is the first four significant letters of a Taxpayer`s last name that the IRS uses in connection with the Taxpayer SSN to identify the Taxpayer, Spouse and Dependents.
Non-Transmitting Computer A computer which prepares Returns, but does not communicate with Central Site via Transmitting. Instead, the Non-Transmitting computer transfers information to the Transmitting Computer.
Occupation A description of what the Taxpayer does to earn income.
Paid Preparer This is an individual who is paid to prepare Tax Returns. A Paid Preparer is not necessarily also an ERO, but instead may work for an ERO.
Part-Year Resident This is a person who lived in a particular state for only part of the year, and may have to file a state income tax return for that state if he or she lived there a specific amount of time and/or made a certain amount of income from a source in that state.
Personal Exemption An exemption claimed for yourself and, if married filing jointly, for your spouse.
PIN A Personal Identification Number used by a Taxpayer and/or an ERO as a replacement to a signature in some cases. This number is not assigned by any agency, but rather is chosen by the person using the pin.
PTIN A Preparer Tax Identification Number can be used by Preparers who are not working as a business entity, and therefore, do not have a separate FEIN, so that they do not have to share their Social Security Number with their Clients.
Qualifying Widow(er) This is a filing status claimed by a Taxpayer whose Spouse has died during the tax year and entitles the Taxpayer to the tax rates and benefits of a joint return. If a widow(er) has Dependents and does not remarry, that person may be allowed to claim Qualifying Widow(er) status for 2 additional years.
RAC A Refund Anticipation Check is a check issued by the Bank after funds have been received by the IRS and requires no out of pocket fees from the Client.
Refund This is the amount owed to a Taxpayer when the total tax payments made for the year are greater than the total tax due for the year.
Remote Computer See Feeder Site above.
Remote Office An office whose registration and setup is controlled by a Main Office. The level of access granted to a Remote Office will be controlled by the Main Office.
Rejection A message from the IRS or the State Agency that a Return has not been accepted via electronic filing. The Return must be corrected and retransmitted.
Retrieve The process which occurs when a Transmitting Computer uploads Return data from a Non-Transmitting Computer.
RTN A Routing Transit Number is a unique number to every bank and is used to identify that bank for direct deposit of a Tax Refund.
SBIN The Service Bureau Identification Number is used when a Tax Preparer has many sites and many different EFIN`s, and is assigned by the IRS.
Site ID This is the code for a particular Site assigned by the User so that activity at different Sites can be delineated.
SSN The Social Security Number is what most Taxpayers use for identification purposes.
Standard Deduction This is an amount that reduces the taxable income subject to tax and varies according to filing status, age, blindness, and dependency of the Taxpayer, Spouse and any Dependents.
Submission ID This is a globally unique 20 digit number assigned to electronically filed tax returns with the following format: EFIN + ccyyddd + 7-digit alphanumeric sequence number.
Status Codes These Codes indicate the status of a current Return, such as whether it has been acknowledged, accepted, or completed.
Taxpayer The Taxpayer is the person for whom the Preparer is preparing Tax Returns. The Taxpayer is interchangeably referred to as the Client.
TIN The Taxpayer Identification Number is a generic name for any type of Identification number that is used to represent a Taxpayer. A TIN could be assigned by a Federal Agency or a State Agency.
Transfer(ring) The process which occurs when Return data is sent from a Non-Transmitting Computer to a Transmitting Computer.
Transmit(ting)/Transmission The process which occurs when a Transmitting Computer sends information to and receives information from Central Site.
Transmitting Computer This is a computer capable of Transmitting to and from Central Site. A Transmitting Computer does not necessarily have an associated Non-Transmitting Computer.
Transmitter Add-on Fee This fee is subtracted from Tax Preparation fees and deposited into the User`s account for purchase of next year`s program.
Updates Data received from Central Site which makes alterations to the program during the tax season in order to keep up with changes in the tax laws and regulations, or to make the program work more efficiently.
User A person who is using this program. This person could be a Paid Preparer, an ERO, a Data Entry person, or any other person using the program. This person could have Administrator status allowing them access to all functions or a very limited access allowing only a few specific functions.
User ID This is the identification code assigned to an office in a Multi-Office Organization or Service Bureau.
Verify(ing) - The internal process which occurs within the program before Transmitting to Central Site in order to catch errors at an early stage. This process is also used for paper Returns.