Adjusted gross income
Gross income after specified adjustments and before the standard or itemized deduction.
Explore related resourceForms & References · Last reviewed August 3, 2026
Tax Glossary for Freelancers and 1099 Workers
Short definitions for terms used across the calculators and guides. Definitions are educational summaries, not eligibility conclusions.
Additional Medicare Tax
An additional federal Medicare-related tax that may apply above filing-status-specific thresholds.
Explore related resourceAmended return
A return filed to change certain information on a previously filed return.
Explore related resourceAnnualized income
A method that considers when income was earned during the year, often relevant to uneven estimated payments.
Explore related resourceBasis
A tax measure of investment in property or an account used in calculations such as gain, loss, or depreciation.
Explore related resourceBillable hours
Working time that can be charged to a client, excluding administrative and other nonbillable time.
Explore related resourceBusiness expense
A cost connected with operating a business whose tax treatment depends on facts and current rules.
Explore related resourceBusiness income
Receipts or earnings from business activity before or after expenses depending on context.
Explore related resourceBusiness-use percentage
The supported share of mixed-use property or service attributable to business activity.
Explore related resourceCapital asset
Property treated as a capital asset under federal tax rules, subject to definitions and exceptions.
Explore related resourceCapitalization
Recording a cost as an asset rather than deducting the entire cost immediately.
Explore related resourceCash method
An accounting method that generally recognizes income when received and expenses when paid, subject to rules and exceptions.
Explore related resourceChargeback
A reversal of a payment that may require reconciliation with gross processor reports.
Explore related resourceCredit
An amount that may reduce tax, subject to eligibility, limitations, and whether it is refundable.
Explore related resourceDeduction
An allowed amount that may reduce income used in a tax calculation; it is not normally a dollar-for-dollar refund.
Explore related resourceDependent
A person who meets current relationship, residency, support, and other requirements for a claimed tax benefit.
Explore related resourceDepreciation
A method of recovering the cost or other basis of qualifying property over time.
Explore related resourceDirect expense
A home-office cost tied specifically to the business part of a home.
Explore related resourceEffective tax rate
Total tax divided by the relevant income measure; the chosen numerator and denominator should be stated.
Explore related resourceEmployee
A worker whose classification depends on control and other facts under applicable law, not payment preference.
Explore related resourceEstimated tax
Periodic payments used to pay income and other taxes not sufficiently covered by withholding.
Explore related resourceExpense reimbursement
Repayment of a cost, whose reporting and deduction treatment depends on the arrangement and facts.
Explore related resourceFiling status
A federal return category based on marital and household facts that affects several tax calculations.
Explore related resourceFiscal year
A twelve-month accounting period ending on a date other than December 31, subject to applicable rules.
Explore related resourceForm 1040
The main U.S. federal individual income-tax return.
Explore related resourceForm 1040-ES
The IRS estimated-tax package for individuals.
Explore related resourceForm 1099-K
An information return reporting gross payment-card or certain third-party-network transactions.
Explore related resourceForm 1099-NEC
An information return used for certain nonemployee compensation.
Explore related resourceForm W-9
A request for taxpayer identification number and certification supplied to a requester, not filed through this site.
Explore related resourceFreelancer
A person providing services independently; tax and worker classification depend on the actual arrangement.
Explore related resourceGross income
Income before deductions or adjustments, with scope depending on the tax context.
Explore related resourceGross profit
Net receipts minus cost of goods sold, before other business expenses.
Explore related resourceGross receipts
Total business receipts before returns, allowances, fees, and expenses are considered.
Explore related resourceHome office
A part of a home used for business whose deduction eligibility depends on current requirements and facts.
Explore related resourceIndependent contractor
A worker classification based on facts and law rather than a label or preference.
Explore related resourceIndirect expense
A home cost that may benefit the entire home and require allocation for an actual-method home-office calculation.
Explore related resourceInformation return
A form a payer or institution provides to a recipient and the IRS to report specified transactions.
Explore related resourceInstallment agreement
An IRS payment arrangement subject to current eligibility, fees, and terms.
Explore related resourceInventory
Goods held for sale whose accounting and cost treatment may differ from ordinary operating expenses.
Explore related resourceItemized deduction
A qualifying deduction claimed through itemization instead of the standard deduction.
Explore related resourceListed property
Certain property subject to special substantiation or business-use rules under current law.
Explore related resourceMarginal tax rate
The rate applying to the next portion of taxable income within a progressive bracket system.
Explore related resourceMedicare tax
A federal payroll-related tax component included in self-employment tax calculations.
Explore related resourceMixed-use expense
A cost serving both business and personal purposes that may require supported allocation.
Explore related resourceModified adjusted gross income
An adjusted income measure modified for a particular rule; the additions vary by provision.
Explore related resourceNexus
A connection that may allow a jurisdiction to impose filing, collection, or tax obligations, depending on current law.
Explore related resourceNet earnings
The Schedule SE concept used to determine the earnings subject to self-employment tax.
Explore related resourceNet profit
Business income remaining after supported business costs, before considering every tax adjustment.
Explore related resourceNonemployee compensation
Compensation for services provided outside an employee relationship, subject to classification facts.
Explore related resourceNonrefundable credit
A credit generally limited by the tax it is allowed to offset under current rules.
Explore related resourceOrdinary and necessary
A federal business-expense standard whose application depends on the business and facts.
Explore related resourceOverpayment
Payments and refundable credits exceeding the tax shown, before other offsets or adjustments.
Explore related resourcePayroll tax
A general term for employment-related taxes such as Social Security and Medicare taxes.
Explore related resourcePlaced in service
The point when property is ready and available for its intended use, relevant to depreciation timing.
Explore related resourcePrincipal place of business
A concept used in several tax contexts, including some home-office determinations.
Explore related resourceQualified business income
A defined amount from qualifying pass-through business activity used in the QBI deduction calculation.
Explore related resourceQuarterly payment
A common planning label for estimated payments, although federal payment periods are not equal calendar quarters.
Explore related resourceRecordkeeping
Maintaining support for income, expenses, classifications, payments, and positions reported on a return.
Explore related resourceRefundable credit
A credit that may produce an amount beyond tax liability when current eligibility rules are met.
Explore related resourceReimbursement
Payment that repays a cost and may change who reports or deducts the expense.
Explore related resourceReturn and allowance
A reduction of gross receipts for customer returns, refunds, or allowances where applicable.
Explore related resourceSafe harbor
A rule offering specified treatment when exact legal requirements are met; a planning comparison is not a determination.
Explore related resourceSales tax collected
Tax collected from customers that may need to be separated from business revenue and remitted under applicable law.
Explore related resourceSchedule 1
The Form 1040 schedule for certain additional income and adjustments.
Explore related resourceSchedule 2
The Form 1040 schedule for certain additional taxes.
Explore related resourceSchedule 3
The Form 1040 schedule for certain additional credits and payments.
Explore related resourceSchedule C
The federal schedule used to report profit or loss from a sole proprietorship.
Explore related resourceSchedule E
The federal schedule for specified supplemental income and loss categories.
Explore related resourceSchedule SE
The federal schedule used to figure self-employment tax on net earnings.
Explore related resourceSelf-employment tax
Federal Social Security and Medicare taxes calculated on qualifying net earnings from self-employment.
Explore related resourceSocial Security wage base
The annual maximum earnings subject to the Social Security component, coordinated with covered wages.
Explore related resourceSole proprietor
An individual who owns an unincorporated business, subject to entity and classification facts.
Explore related resourceStandard deduction
A filing-status-based deduction amount that may be used instead of itemized deductions under current rules.
Explore related resourceStandard mileage rate
An IRS-set per-mile amount for qualifying use, with year and effective period that must be verified.
Explore related resourceState sourcing
Rules a state uses to determine whether income is connected to that state.
Explore related resourceTaxable income
The income measure remaining after applicable deductions and used for income-tax calculations.
Explore related resourceTax credit
An amount that may reduce tax and may be refundable or nonrefundable under current rules.
Explore related resourceTax deduction
An allowed reduction in an income measure, not generally a dollar-for-dollar payment.
Explore related resourceTax liability
The tax determined under applicable rules before or after credits depending on context.
Explore related resourceTax reserve
Cash set aside for planning; it is not itself a payment or legal safe-harbor determination.
Explore related resourceTax year
The annual accounting period to which forms, rates, limits, and instructions apply.
Explore related resourceUnderpayment
A shortfall in required timely tax payments under applicable rules.
Explore related resourceUtilization
The share of available working time expected to be billable.
Explore related resourceWithholding
Tax retained from a payment and remitted on the recipient’s behalf, subject to reporting rules.
Explore related resourceWorker classification
The legal determination of whether work is performed as an employee or independent contractor based on facts.
Explore related resourceOfficial reference
For controlling definitions, use current IRS forms, instructions, and publications. Terms can have different meanings in different provisions.
Tax disclaimer
General education only. This glossary does not determine classification, eligibility, filing requirements, or tax treatment.