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IRS Publication 519: U.S. Tax Guide for Aliens IRS Publication 519 explains U.S. federal tax rules for noncitizens. The publication defines tax residency, explains how different types of income are taxed, and identifies filing requirements and options that affect aliens (noncitizens) in the United States. Key points Tax treatment depends on whether you are a…

IRS Publication 463: Travel, Gift, and Car Expenses What Publication 463 covers IRS Publication 463 explains which business-related travel, gift, and vehicle expenses an individual taxpayer can deduct. It is most relevant to: Sole proprietors and other self-employed taxpayers reporting business income on Schedule C. Certain employees who may still deduct business expenses using Form…

IRS Publication 15: Employer’s Tax Guide IRS Publication 15 (also known as Circular E) explains employer responsibilities for withholding, depositing, reporting, paying, and correcting federal employment taxes. It is the primary federal reference employers use to manage payroll tax compliance. Key takeaways Publication 15 covers federal employment taxes only (not state or local taxes). Employers…

IRS Form 4868: Application for Automatic Extension of Time to File U.S. Individual Income Tax Return Form 4868 lets U.S. citizens and residents request an automatic extension to file their federal individual income tax return. The extension applies only to the filing deadline—not to payment of any tax owed. Key points Grants an automatic extension…

Irrevocable Trust An irrevocable trust is a legal arrangement in which a grantor transfers assets out of their ownership into a trust that generally cannot be changed, amended, or revoked without the consent of the beneficiaries or a court order. Because ownership shifts to the trust and a trustee manages the assets for beneficiaries, irrevocable…

Irrevocable Letter of Credit An irrevocable letter of credit (ILOC) is a bank-issued guarantee that a buyer’s payment to a seller will be made on time and for the agreed amount. Once issued, it cannot be canceled or changed without the consent of all parties involved (applicant/buyer, beneficiary/seller, and the issuing bank). ILOCs are commonly…

Irrevocable Beneficiary Key takeaways * An irrevocable beneficiary is a person or entity named to receive proceeds from a life insurance policy or similar contract whose status cannot be changed without that beneficiary’s consent. * Irrevocable designations generally override wills and avoid probate, delivering funds more quickly to the recipient. * The main advantage is…

Irrational Exuberance What it means Irrational exuberance describes investor enthusiasm that pushes asset prices well beyond what fundamentals justify. The phrase was popularized by Federal Reserve Chair Alan Greenspan in a 1996 speech as markets — notably technology shares — were beginning to show bubble-like behavior. Explore More Resources › Read more Government Exam Guru…

Internal Rate of Return (IRR) Rule — Definition and How to Use It The internal rate of return (IRR) rule is a capital-budgeting guideline: accept a project if its IRR exceeds the required rate of return (hurdle rate); reject it if the IRR is below that rate. IRR is the discount rate that makes the…

Iron Butterfly (Iron Fly): Definition and Overview An iron butterfly is a neutral options strategy that profits when the underlying asset’s price remains within a narrow range through option expiration and when implied volatility falls. It combines a short at-the-money straddle with out-of-the-money protective options (a long strangle), using four option legs with the same…

Iranian Rial (IRR) The Iranian rial (IRR) is the official currency of the Islamic Republic of Iran. Named after the Spanish real, the rial was first introduced in 1798 and is issued by the Central Bank of the Islamic Republic of Iran. Its Arabic symbol is ﷼. Although the rial is subdivided into 100 dinars,…

IRA Rollover An IRA rollover moves retirement funds from one qualified account (for example, a 401(k) or 403(b)) into an individual retirement account (IRA) while preserving the tax‑deferred status of the money. Rollovers are commonly done after changing jobs or when you want broader investment choices or different account features. Types of rollovers Direct rollover…

IOU — Definition, Use, and Practical Guidance What is an IOU? An IOU (“I owe you”) is a written acknowledgment that one party owes a debt to another. It is an informal record of a loan or unpaid obligation that documents the existence and amount of the debt but often omits detailed repayment terms. IOUs…

What Is IOTA (MIOTA)? IOTA is a distributed ledger protocol designed for machine-to-machine transactions and data exchange within the Internet of Things (IoT). Instead of a traditional blockchain, IOTA uses a directed acyclic graph (DAG) called the Tangle to confirm transactions. Its native token, MIOTA, is used to account for value and activity on the…

Invoice Financing Invoice financing lets businesses convert unpaid customer invoices into immediate cash. It’s a short-term financing option that improves working capital without waiting for customers to pay, and is commonly used by companies with slow-paying clients or seasonal cash flow needs. How it works A business issues goods or services on credit and generates…

Understanding Invoices: Definition, Key Parts, and Business Role What is an invoice? An invoice is a time-stamped commercial document that itemizes a transaction between a buyer and a seller. It records goods or services provided, the amounts due, and the payment terms. Invoices are essential for bookkeeping, accounts payable/receivable, tax reporting, and audit trails. Explore…

Invisible Hand: A Clear Overview The “invisible hand” is a metaphor introduced by Adam Smith to describe how individuals pursuing their own interests in free markets can unintentionally produce outcomes that benefit society. Through voluntary exchange and price signals, decentralized decisions coordinate production and consumption without central direction. Key takeaways The invisible hand explains how…

Investor Relations: Role, Functions, Goals, and Legislative Impact What is Investor Relations (IR)? Investor relations (IR) is the corporate function that communicates a company’s financial performance, strategy, and governance to current and prospective investors, analysts, and the broader financial community. IR helps ensure that a company’s securities are fairly valued by providing timely, accurate, and…

Investor An investor is an individual or organization that commits capital with the expectation of earning a financial return. Investors deploy funds across assets such as stocks, bonds, real estate, funds, commodities, and alternative investments to achieve goals like retirement savings, education funding, or wealth accumulation. Returns come primarily from appreciation (selling assets for more…

Investment Vehicles An investment vehicle is any product or method used to invest money with the goal of earning a return. Vehicles vary widely in structure, risk, liquidity, and return potential — from cash-equivalent accounts to stocks, bonds, real estate, pooled funds, and alternative investments. Key takeaways Investment vehicles let investors pursue growth, income, or…

Investment Thesis What is an investment thesis? An investment thesis is a concise, research-backed argument for why a particular investment or strategy should be pursued. It summarizes the rationale, expected outcomes, key assumptions, risks, time horizon, and metrics for success. Written explicitly, it guides decision-making, limits emotional reactions, and provides a reference to evaluate outcomes….

What Is an Investment Strategy? An investment strategy is a structured plan that guides how you allocate capital to meet specific financial goals while reflecting your risk tolerance and time horizon. It determines what asset classes to use (stocks, bonds, real estate, cash equivalents), how much to allocate to each, and when to rebalance or…

Investment Securities Investment securities are tradable financial assets purchased primarily for investment purposes. They include equities (common and preferred stock), debt instruments (bonds and debentures), and short-term money-market instruments. Financial institutions—particularly banks—use these securities to generate income, manage liquidity, and satisfy regulatory or pledge requirements. How banks use investment securities Liquidity management: Marketable securities can…

Investment properties are real estate assets bought to generate a financial return through rental income, appreciation (future resale), or both. They may be held by individual investors, partnerships, or corporations and used as long-term income-producing holdings or short-term flips. Key takeaways * Investment properties produce income but are not the owner’s primary residence. * Common…

Investment Products: Definition and Examples Key takeaways * An investment product is any financial instrument purchased with the expectation of earning a return. * Products are typically chosen for capital appreciation, income generation, or a mix of both. * Common categories include stocks, bonds, derivatives, and pooled/structured vehicles (mutual funds, ETFs, annuities). * Investor objectives,…

Investment Policy Statement (IPS) An Investment Policy Statement (IPS) is a written roadmap that defines how an investment portfolio will be structured, managed, and reviewed. It aligns the investor’s goals and constraints with the investment strategy used by advisors or portfolio managers and helps prevent reactionary decisions during market volatility. How an IPS works Documents…

Investment Objective An investment objective is a clear statement of financial goals that guides how a portfolio is built and managed. Financial advisors and asset managers use an investor’s objective to determine the appropriate strategy, asset allocation, and specific investments consistent with that goal. How it works An investor (or advisor) completes a questionnaire covering…

Investment Multiplier The investment multiplier is a Keynesian concept that describes how an initial increase in investment spending leads to a larger total increase in aggregate income. Because recipients of the initial spending (workers, suppliers, businesses) spend a portion of that income, successive rounds of spending create a multiplied impact on the economy. Key takeaways…

What is an investment manager? An investment manager is an individual or firm that designs and implements investment strategies, manages portfolios, and handles day‑to‑day buying and selling of securities on behalf of clients. They monitor markets, measure performance, settle transactions, and adjust holdings to meet clients’ goals and risk tolerances. Key takeaways Investment managers handle…

Investment Management Investment management is the professional oversight of financial assets and securities to meet specific goals for individual or institutional clients. It includes portfolio construction, asset allocation, security selection, risk management, tax-aware strategies, and ongoing monitoring and reporting. Key takeaways Professional service that manages portfolios for individuals and institutions. Involves strategy design, executing trades,…

Investment income is the money you receive from assets you own—above the amount you originally invested. It includes interest, dividends, rents, royalties, and capital gains realized when you sell an asset for more than its cost. Understanding what counts as investment income, how it’s realized, and how it’s taxed helps with planning, reporting, and deciding…

Investment Horizon: Considerations for Your Portfolio What is an investment horizon? An investment horizon is the length of time an investor expects to hold a security or a portfolio before needing to convert it to cash. Horizons range from minutes or days (short-term traders) to decades (retirement savers). Why it matters The investment horizon shapes…

Investment Grade: What It Means and Why It Matters What is investment grade? Investment grade is a credit rating category indicating that a bond issuer (corporate, municipal, or sovereign) has a relatively low risk of default. Ratings are assigned by agencies such as Standard & Poor’s (S&P), Moody’s, and Fitch and help investors gauge credit…

What is an investment fund? An investment fund is a pooled collection of capital from multiple investors used to buy a diversified portfolio of securities. Each investor owns shares of the fund rather than the underlying assets. Funds offer broader diversification, professional management, and cost efficiencies that individual investors often cannot achieve alone. How investment…

Investment Consultant: Role, Types, Qualifications, Pay What is an investment consultant? An investment consultant is a financial professional who helps individuals, businesses, and institutions develop and implement investment strategies. They evaluate a client’s financial situation, construct and maintain portfolios, monitor performance, and adjust recommendations as goals or market conditions change. Many financial planners and advisors…