Glossary

The U.S. Tax Court allows taxpayers to dispute IRS assessments and decisions, providing an independent forum for resolving tax controversies.

A tax credit directly reduces a taxpayer’s tax liability, potentially resulting in a refund or lowering the amount of taxes owed.

Tax debt forgiveness refers to programs that allow taxpayers to reduce or eliminate their tax debt based on financial hardship or inability to pay.

A tax deduction reduces a taxpayer’s taxable income, thereby lowering their overall tax liability.

A Tax Deed is a legal document granting ownership of a property to a government entity when the property owner fails to pay the property taxes.

Tax deferment allows taxpayers to delay paying taxes on income or gains until a future date, such as with retirement accounts or investment gains.

A tax deficiency is the difference between the amount of tax the IRS determines you owe and the amount you reported on your return.

Tax evasion is the illegal act of deliberately avoiding paying taxes owed to the IRS, resulting in severe penalties, fines, and potential imprisonment.

A tax extension gives taxpayers an additional six months to file their tax return, but they must still pay any taxes owed by the original deadline.

Tax forgiveness is when the IRS cancels part or all of a taxpayer’s debt, often through an Offer in Compromise or similar program.

Tax forgiveness for the deceased may relieve some tax liabilities if a taxpayer dies with unpaid taxes, though the estate is generally responsible for the debt.

Tax garnishment is a legal process through which the IRS seizes a portion of a taxpayer’s wages, bank accounts, or other assets to satisfy unpaid tax debts.

A tax levy allows the IRS to seize a taxpayer’s assets, including wages and bank accounts, to satisfy unpaid tax debt.

A tax levy release halts the IRS from seizing assets like wages or bank accounts to collect unpaid tax debt, providing temporary relief to the taxpayer.

A tax lien is a legal claim placed by the IRS on a taxpayer’s property, giving the government the right to collect unpaid taxes from the property’s value.

A Tax Lien Certificate is a certificate of claim against a property due to unpaid property taxes, providing the certificate holder with potential financial benefits such as interest and eventual

Tax lien foreclosure occurs when a government entity sells a property to recover unpaid taxes. It plays a significant role in enforcing tax compliance.

A Tax Lien Investment involves purchasing a lien on a property due to unpaid taxes, potentially yielding high returns if property owners fail to pay owed taxes.

A Tax Lien Sale is a process where delinquent property taxes are collected by selling a lien to an interested buyer. This helps municipalities recover unpaid taxes efficiently.

Tax lien subordination allows a federal tax lien to be moved to a lower priority, helping taxpayers refinance or sell property while still owing tax debt.