Glossary

The IRS CP91 Notice notifies taxpayers that 15% of their Social Security benefits will be levied to settle unpaid tax debts unless they respond by the deadline.

The IRS CP92 Notice informs taxpayers that their state tax refund has been levied to satisfy federal tax debts, with instructions on next steps.

IRS CP92 Notice informs taxpayers that their state tax refund has been seized to satisfy unpaid federal tax debt, and provides instructions for resolving the balance.

IRS CP98 Notice notifies taxpayers that their refund has been used to cover unpaid tax debt from a previous year.

Currently Not Collectible (CNC) status temporarily suspends IRS collection actions for taxpayers who cannot afford to pay their tax debt.

A delinquent tax return is a return that was not filed on time, which may result in penalties, interest, and enforcement actions by the IRS.

A Dependent Care FSA allows employees to use pre-tax income to cover eligible childcare and dependent care expenses, reducing taxable income.

The dependent exemption allowed taxpayers to reduce their taxable income for each qualifying dependent before it was suspended by tax reform in 2018.

The Earned Income Credit (EIC) is a refundable tax credit for low- and moderate-income earners, helping reduce their tax liability and providing a possible refund.

The Earned Income Tax Credit (EITC) is a tax credit designed to help low- to moderate-income taxpayers by reducing their tax liability.

Estimated tax payments are required for taxpayers who do not have taxes withheld from their income, such as self-employed individuals, to avoid penalties.

The Failure to Deposit Penalty is imposed on employers who fail to make timely federal tax deposits for payroll taxes, resulting in fines and interest charges.

The IRS Failure to File Penalty is imposed on taxpayers who fail to file their tax return by the due date, typically 5% of the unpaid tax for each month

The IRS Failure to Pay Penalty is imposed when taxpayers do not pay their taxes by the due date, typically 0.5% of the unpaid tax for each month late.

Federal income tax brackets are used to determine how much tax a taxpayer owes based on their taxable income, with rates ranging from 10% to 37%.

FICA is a law requiring payroll taxes for Social Security and Medicare, with contributions shared by employers and employees.

The Federal Payment Levy Program (FPLP) allows the IRS to levy federal payments, such as Social Security benefits, to collect unpaid tax debt.

A Federal Tax Deposit (FTD) is a payment made to the IRS by employers to cover payroll taxes, including income tax withholdings, Social Security, and Medicare taxes.

The Federal Unemployment Tax Act (FUTA) imposes a tax on employers to fund unemployment compensation programs.

The filing deadline is the date by which taxpayers must file their tax returns or request an extension to avoid late-filing penalties.