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Real Estate Glossary
Our glossary is the largest dictionary of real estate and construction terms on the Internet with almost 10,000 definitions.
- A dark petroleum residue used as a sealant and in paving.
- A bright, easily visible object used in surveying to allow easy sighting.
- A trade name for a binder used in paving.
- A paving material consisting of crushed rock and asphalt.
- A water resistant covering.
- A charge levied upon persons or things by a government.
- Tax and Insurance Escrow
- When a mortgage loan is provided to a borrower, the lender establishes a fund called a tax and insurance escrow to accumulate the debtor's monthly payments for property taxes and insurance premiums for the mortgaged property.
- Tax Assessor
- Government official who values real estate property for tax purposes and ascertains the annual property tax assessments that must be collected.
- Tax Avoidance
- Payment of the minimum tax by using legal tax planning opportunities such as estate planning.
- Tax Base
- The collective value of property, income or other taxable activity or assets subject to a tax. Tax revenues are computed as the tax base times the tax rate. For property taxation, the tax base is the total assessed value of all taxable property less exemptions.
- Tax Basis
- The cost basis of property, such as a home owned for tax purposes.
- Tax Book
- Compilation of all tax maps of a given tax district that are bound together and kept at the local tax office. The tax book is a public record that may be accessed by an individual for review upon request.
- Tax Credit
- A reduction against income tax payments that would otherwise be due.
- Tax Deduction
- Tax break that is allowed by the government and used to reduce taxable income. Items such as mortgage interest, loan points that are paid and property taxes.
- Tax Deed
- The type of instrument given to a grantee by a government that had claimed the property for unpaid taxes.
- Tax District
- Region or locality that assessed real estate taxes on the properties located within its borders. Frequently, the local county or city is the property taxing jurisdiction that is empowered, by law, to assess taxes on real estate.
- Tax Equity and Fiscal Responsibility Act of 1982 (TEFRA)
- Federal tax legislation notably establishing 19% withholding on interest and dividends.
- Tax Evasion
- Failure to pay taxes legally due the government, often by failure to report some income received or claiming false deductions.
- Tax Exempt
- Tax-free status given to certain nonprofit organizations and governmental entities.
- Tax Exempt Bond
- Bond whose interest is free of federal, state or local tax in the state of the issuer and is typically a municipal bond of a state or county agency.
- Tax Exempt Property
- Real estate that is not subject , in whole or part, to ad valorem property taxes. Churches, charities and government buildings do not pay property tax because of their tax-free status.
- Tax Flaw
- Defect in the tax law that either may provide a loophole to minimize the tax payment or result in higher taxes than there should be.
- Tax Foreclosure
- Property taken over by the government because the owner has failed to pay taxes on it. The property may revert back to the owner when the taxes are paid. If not, the government may sell the property to collect the amount due.
- Tax Free Exchange
- Transfers of real estate from one taxpayer to another that are exempt from federal income taxes.
- Tax Liability
- Legal obligation to pay taxes associated with owning property or earning income.
- Tax Lien
- Legal claim placed on a property for nonpayment of taxes.
- Tax Map
- Map which documents the area, perimeter location, dimensions and other data relating to land for purposes of assessing annual real estate taxes.
- Tax Participation
- Standard portion of a lease which indicates that in the event of an increase in annual assessed real estate taxes during the lease term the lessee will be responsible for higher monthly payments to cover the increase.
- Tax Planning
- Evaluation of different tax options of investing in real estate with the purpose of reducing the tax liability in current and future years.
- Tax Preference Item
- Item falling under Section 57 of the Internal Revenue Code that may result in the imposition of the alternative minimum tax (AMT). These items of otherwise exempt income or deductions or of special tax benefit were targeted to ensure that taxpayers who benefit should pay the minimum amount of tax.
- Tax Rate
- The ratio of a tax assessment to the amount being taxed. Amount of tax to be paid based on taxable income. The tax rate usually changes as the unit of the tax base changes.
- Tax Refund
- Amount the taxpayer gets back when he/she files the tax return at the end of the reporting year because taxes were overpaid for that year. The tax overpayment equals the tax payments remitted less the tax actually due.
- Tax Return
- Generic name of the form used to file taxes payable to a federal, state or local government. The tax return includes items such as gross income, deductions, tax credits and tax due. Individual taxpayers file on a calendar year basis using Form 1040, which is due 3 ½ months after the tax year. Corporations prepare Form 1120 on a calendar year or fiscal year basis. It is due 2 ½ months after the tax year. The partnership tax return is Form 1065.
- Tax Roll
- The list of all properties subject to a tax in a county or other property taxing jurisdiction. It identifies al properties and indicates their assessed values.
- Tax Sale
- Public sale of property, by the government, for nonpayment of taxes.
- Tax Shelter
- Term that refers to various tax advantages, one of which is often real estate investment.
- Tax Shield
- Deductions that result in a reduction of tax payments. The tax shield equals the amount of the deduction times the tax rate.
- Tax Stop
- Clause in a lease that sets a maximum limit on the amount of property taxes that a lessor will pay. The lessee is required to pay any taxes in excess of that limit.
- Taxable Income
- For the individual, adjusted gross income less itemized deductions and personal exemptions. After taxable income is computed, the tax to be paid can be determined by looking at the tax rate schedules. For corporations, gross income less allowable business deductions.