Deduction

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Related to deductions: Tax deductions, Payroll deductions, Standard Deductions

Deduction

An expense that is allowable as a reduction of gross taxable income by the IRS e.g., charity donations.

Deduction

An amount of money that one may subtract from one's gross annual income when calculating one's income tax liability. A common misconception about tax deductions is that they represent a dollar-for-dollar reduction of one's tax liability. Rather, a deduction removes a certain dollar amount from the income the IRS uses to calculate the percentage of one's income that is owed in taxes. Common deductions are charitable contributions, business expenses, and interest on mortgages. See also: Tax credit.

deduction

An expenditure that may legally be used to reduce an individual's income-tax liability. Potential deductions of particular interest to investors are expenditures for subscriptions to financial publications, a lock box for storing securities, and computer software for investment-related activities. These deductions, combined with employee business expenses and miscellaneous deductions, may be subtracted from a person's taxable income only to the extent their total exceeds 2% of that person's adjusted gross income. Interest paid on loans used to finance investments is deductible only against investment income. Also called itemized deduction, tax deduction. See also charitable contribution deduction.

Deduction.

A deduction is an amount you can subtract from your gross income or adjusted gross income to lower your taxable income when you file your income tax return.

Certain deductions, such as money contributed to a traditional IRA or interest payments on a college loan, are available only to taxpayers who qualify for these deductions based on specific expenditures or income limits, or both.

Other deductions are more widely available. For example, you can take a standard deduction, an amount that's fixed each year. And if your expenses for certain things, such as home mortgage interest, real estate taxes, and state and local income taxes, total more than the standard deduction, it may pay for you to itemize deductions instead.

However, if your adjusted gross income is above the limit Congress sets for the year, you may lose some of or all these deductions.

Deduction

An amount that may be subtracted from income that is otherwise taxable.
References in classic literature ?
I know not," continued Dupin, "what impression I may have made, so far, upon your own understanding; but I do not hesitate to say that legitimate deductions even from this portion of the testimony - the portion respecting the gruff and shrill voices - are in themselves sufficient to engender a suspicion which should give direction to all farther progress in the investigation of the mystery.
You may not be aware that the deduction of a man's age from his writing is one which has brought to considerable accuracy by experts.
So that no logic, or logical deductions, had anything to do with my resolve;--it was simply a matter of disgust.
Familiar as I was with my friend's methods, it was not difficult for me to follow his deductions, and to observe the untidiness of attire, the sheaf of legal papers, the watch-charm, and the breathing which had prompted them.
So sure was Tarzan that the body was that of he who had robbed him that he made no effort to verify his deductions by scent among the conglomerate odors of the great carnivore and the fresh blood of the victim.
Nowhere had he found any sign that men had stopped even temporarily upon this shore, though, of course, he knew that so quickly does the rank vegetation of the tropics erase all but the most permanent of human monuments that he might be in error in his deductions.
Remember," he continued, "that I have to put this story together, partly from facts which came to my knowledge afterwards, and partly from reasonable deductions.
Anne was miserably silent, hampered by her deductions from her conversation with Owen.
Long habit of weighing and noting well what clients said, and nicely balancing chances in his mind and calculating odds to their faces, without the least appearance of being so engaged, had rendered Gride quick in forming conclusions, and arriving, from puzzling, intricate, and often contradictory premises, at very cunning deductions.
Hence it has been argued that no deductions can be drawn from domestic races to species in a state of nature.
I am speaking now as an investigator--a man of deductions.
When the editor-in-chief was in possession of the precious foot and informed as to the train of intelligent deductions the boy had been led to make, he was divided between the admiration he felt for such detective cunning in a brain of a lad of sixteen years, and delight at being able to exhibit, in the "morgue window" of his paper, the left foot of the Rue Oberskampf.