Category: Financial Terms

Technical Analyst What is a technical analyst? A technical analyst (also called a chartist or market technician) evaluates securities by studying past market prices, trading volume, and chart patterns to identify trends and trading opportunities. Rather than focusing on a security’s intrinsic fundamentals, technical analysts infer the balance of buyers and sellers from price action…

Technical Analysis of Stocks and Trends Technical analysis is a method for forecasting future price movements by studying historical market data—primarily price and volume. Traders use charts, patterns, and statistical indicators to identify likely entry and exit points and to judge whether a trend will continue or reverse. Key takeaways Technical analysis relies on price…

Technical Analysis Key takeaways * Technical analysis examines historical price and volume data to identify trends, patterns, and potential entry/exit points. * It rests on three core assumptions: the market discounts everything, prices move in trends, and history tends to repeat itself. * Common tools include trendlines, support/resistance, moving averages, momentum indicators (e.g., RSI, MACD),…

What is TIAA? TIAA (Teachers Insurance and Annuity Association) is a financial services organization originally created to provide retirement and insurance solutions for people working in the nonprofit sector—especially educators. Founded in 1918 with support from the Carnegie Foundation, TIAA’s mission is helping people who serve others secure reliable retirement income. History and evolution Founded…

Understanding the Teacher Retirement System (TRS) Overview The Teacher Retirement System (TRS) refers to the network of state- and city-level pension systems that administer retirement benefits for public school educators and other education employees (for example, administrators, custodial staff and support personnel). TRS programs typically combine a defined-benefit pension with optional defined-contribution accounts (often a…

Taylor’s Rule Key takeaways Taylor’s Rule is a simple guideline for setting a short-term nominal interest rate based on inflation and the output gap. It links the policy rate to current inflation and the deviation of real GDP from its long-run trend (the output gap), placing substantial weight on inflation. The rule works well as…

Taxpayer Identification Number (TIN) A Taxpayer Identification Number (TIN) is a unique nine-digit identifier used to identify taxpayers for tax administration. The Internal Revenue Service (IRS) uses TINs to process tax returns, report income, and track taxpayer accounts. Social Security numbers (SSNs) are one common type of TIN. Key points TINs are nine-digit numbers used…

Taxpayer: Definition, Overview, and Types Key takeaways * A taxpayer is an individual or business legally required to pay taxes to federal, state, or local governments. * Tax obligations and filing rules differ for individuals, self‑employed persons, partnerships, and corporations. * Filing status, tax brackets, deductions, credits, and special rules (for example, self‑employment tax) determine…

Taxes: Definition, Types, and How They Work Taxes are mandatory contributions levied by governments on individuals and businesses. They fund public goods and services—roads, schools, emergency services, Social Security, Medicare—and support the operation of government. Understanding how taxes are assessed and collected helps taxpayers manage finances and reduce tax burdens legally. Key takeaways Taxes are…

Taxation Without Representation Understanding the concept “Taxation without representation” describes being subject to government taxes while lacking a vote or voice in that government’s decision-making body. The phrase became a rallying cry for American colonists in the 18th century and remains relevant today in parts of the United States where residents pay federal taxes but…

Understanding Taxation Key takeaways * Taxation is the compulsory levy imposed by governments to raise revenue for public goods and services. * Taxes take many forms: income, corporate, capital gains, property, sales/VAT, excise, and inheritance taxes. * Justifications for taxation include funding government functions, promoting equity, correcting externalities, and discouraging harmful consumption. * Tax systems…

Taxable Wage Base: What It Is and How It Works Key takeaways The taxable wage base is the maximum annual earned income subject to Social Security tax (also called the Social Security wage base). Social Security tax is 12.4% of earnings (6.2% paid by the employee, 6.2% by the employer). The Medicare portion (2.9% total;…

Taxable Income: What It Is, What Counts, and How to Calculate What is taxable income? Taxable income is the portion of your gross income that is subject to income tax. It equals your adjusted gross income (AGI) minus either the standard deduction or allowable itemized deductions. Taxable income includes both earned (wages, salaries, tips) and…

Tax Wedge A tax wedge is the difference between before‑tax and after‑tax earnings. It captures how much of labor compensation is taken by taxes (and payroll contributions), and it also describes the gap created between buyer and seller prices when a tax is imposed on a good or service. How the tax wedge is measured…

Tax Treaties: What They Are and How They Work Definition A tax treaty (also called a double tax agreement, or DTA) is a bilateral agreement between two countries that allocates taxing rights to prevent the same income from being taxed twice. Treaties typically cover income, capital, estate, and wealth taxation and set rules for cross-border…

Tax-to-GDP Ratio The tax-to-GDP ratio compares a country’s total tax revenue to its gross domestic product (GDP). It shows what share of a nation’s economic output is collected by the government and helps assess fiscal capacity, public-service funding, and trends in tax policy. Key takeaways The ratio measures tax revenue as a share of economic…

Tax Tables A tax table is a chart that shows how much tax is owed based on taxable income. Tax tables are published by the IRS and by many state revenue agencies to help taxpayers determine their tax liability by income range and filing status. Key takeaways Tax tables map taxable income ranges to tax…

Tax Shield A tax shield is the reduction in taxable income that results from claiming allowable deductions. Common tax shields include mortgage interest, student loan interest, medical expenses, charitable donations, amortization, and depreciation. By lowering taxable income, tax shields reduce the amount of tax owed or defer tax liability to future periods. Key takeaways Tax…

Tax-Sheltered Annuity (TSA / 403(b)): What It Is and How It Works What is a TSA? A tax-sheltered annuity (TSA), commonly called a 403(b) plan, is a retirement savings plan that lets eligible employees make pre-tax contributions from their pay. Contributions and investment earnings grow tax-deferred; the IRS taxes distributions as ordinary income when withdrawn…

Tax Shelter: Definition, Examples, and Legal Issues Key takeaways * A tax shelter is any strategy or vehicle used to reduce or defer taxable income and lower tax liabilities. * Tax shelters can be legal (using deductions, credits, or tax-favored accounts) or illegal (schemes intended to evade taxes). * Common legal shelters include retirement accounts,…

Tax Selling (Tax-Loss Harvesting): What It Is and How It Works Tax selling, often called tax-loss harvesting, is the practice of selling investments that have unrealized losses to realize a capital loss for tax purposes. Realized capital losses can offset realized capital gains, reducing an investor’s tax bill. How it works Realized capital losses offset…

Tax Season: Definition, Dates, and What to Know Key takeaways * Tax season is the period when taxpayers prepare and file returns for the previous tax year—typically Jan. 1 through around April 15. * Federal Tax Day in the U.S. is generally April 15 (when it falls on a weekend the deadline moves to the…

Tax Return: What It Is and How Long to Keep It What is a tax return? A tax return is a form filed with a tax authority that reports a taxpayer’s income, expenses, deductions, and credits so the authority can determine tax liability. Individuals in the U.S. typically file Form 1040 (or 1040‑SR); corporations file…

Tax Relief: What It Is and How It Works Tax relief refers to government policies and programs that reduce tax burdens or help resolve tax-related debts for individuals and businesses. Relief can take the form of deductions, credits, exclusions, targeted incentives, or collection-relief programs. How governments provide tax relief Policy incentives that change the tax…

What Is a Tax Refund? A tax refund is the reimbursement you receive when you paid more in federal or state taxes during the year than you owed. Refunds commonly result from employer withholding that exceeds your actual tax liability or from refundable tax credits. While a refund feels like a windfall, it often reflects…

Tax Reform Act of 1986 — Overview The Tax Reform Act of 1986 was a major overhaul of the U.S. federal income tax system enacted to simplify the tax code, broaden the tax base, and lower marginal tax rates. Signed into law by President Ronald Reagan on October 22, 1986, the law sought to reduce…

Tax Rate Key takeaways * A tax rate is the percentage applied to income, sales, property, or capital gains to determine tax owed. * The United States uses a progressive income tax: higher income is taxed at higher marginal rates. * Marginal rates apply to portions of income; the effective tax rate is the total…

Tax Planning: Strategies, Benefits, and Examples What is tax planning? Tax planning is the process of arranging your finances to minimize tax liability while supporting long-term financial goals. A tax-efficient plan times income, deductions, and investments to reduce current taxes and maximize after-tax wealth. Key takeaways Tax planning coordinates income timing, investment choices, and retirement…

Tax-Loss Harvesting What is tax-loss harvesting? Tax-loss harvesting is the practice of selling investments that have declined in value to realize a capital loss, and using that loss to offset capital gains from profitable investments. The goal is to reduce current tax liability while preserving the portfolio’s overall risk/return profile. Explore More Resources › Read…

Tax Loss Carryforward What it is A tax loss carryforward (or carryover) lets individuals or businesses apply a tax loss from one year to reduce taxable income in future years. It helps smooth tax obligations across profitable and unprofitable periods. Key takeaways Two main types: net operating loss (NOL) carryforwards and capital loss carryforwards. NOL…

Tax Lien Certificate: What It Is and How It Works Key takeaways * A tax lien certificate is a claim against a property created when property taxes go unpaid; local governments may sell these certificates to investors. * Investors earn returns through interest and penalties paid by the property owner during a redemption period; if…

Tax Lien Key takeaways * A tax lien is a legal claim by a government against a taxpayer’s assets for unpaid taxes. * A lien secures the government’s interest; a levy permits the government to seize and sell assets to satisfy the debt. * Liens can be resolved by paying the tax, negotiating with the…

Tax Liability What is tax liability? Tax liability is the amount of tax debt owed to a government by an individual, business, or other entity. It includes federal, state, and local obligations such as: * Income tax * Capital gains tax * Sales and use taxes * Payroll taxes (Social Security and Medicare) Tax liability…

Tax Incidence Key takeaways Tax incidence describes who legally pays a tax and who ultimately bears its economic burden. The division of burden between buyers and sellers depends mainly on the price elasticity of supply and demand. Taxes on inelastic goods tend to be borne by consumers; taxes on elastic goods tend to fall more…

Tax Identification Number (TIN) A Tax Identification Number (TIN) is a unique nine-digit identifier used by tax authorities to identify taxpayers and administer the tax system. In the U.S., the Internal Revenue Service (IRS) issues most TINs; Social Security numbers (SSNs) are issued by the Social Security Administration. Key takeaways TINs are nine-digit numbers used…