Tax Basics

Understand the tax terms of the debate with the Principles of Sound Tax Policy and our comprehensive tax glossary library, including over 70 tax terms and concepts.

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Tax Basics Glossary

Featured Term

Tax Bracket

A tax bracket is the range of incomes taxed at given rates, which typically differ depending on filing status. In a progressive individual or corporate income tax system, rates rise as income increases. There are seven federal individual income tax brackets; the federal corporate income tax system is flat.

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Top Terms


Windfall Profits Tax

Child Tax Credit (CTC)

Sales Tax Holiday

OECD Pillar 2 (Global Minimum Tax)

Adjusted Gross Income (AGI)

After-Tax Income

Alternative Minimum Tax (AMT)



Average Tax Rate

Base Broadening

Base Erosion and Anti-Abuse Tax (BEAT)

Bonus Depreciation

Book Income

Bracket Creep

C Corporation (C corp)

Cadillac Tax

Capital Allowance

Capital Gains Tax

Capital Stock Tax (Franchise Tax)

Carbon Tax

Child Tax Credit (CTC)

Congressional Budget Office (CBO)

Consumption Tax

Corporate Income Tax

Cost Recovery


Direct Tax

Double Taxation

Dynamic Scoring

Earned Income Tax Credit (EITC)

Estate Tax

Excise Tax


Financial Transaction Tax (FTT)

Flat Tax

Foreign Derived Intangible Income (FDII)

Foreign Direct Investment (FDI)

Full Expensing

Gas Tax

Gift Tax

Global Intangible Low Tax Income (GILTI)

Graduated Rate Income Tax

Gross Receipts Tax

Head Tax

Indirect Tax

Individual Income Tax


Inflation Indexing

Inheritance Tax

Internal Revenue Service (IRS)

International Tax Rule

Internet Sales Tax

Itemized Deduction

Joint Committee on Taxation (JCT)

Last-In, First-Out (LIFO)

Marginal Tax Rate

Mark-to-Market (MTM)

Marriage Bonus

Marriage Penalty

Mortgage Interest Deduction

Net Operating Loss Carryback

Net Operating Loss Carryforward

OECD Pillar 1

OECD Pillar 2 (Global Minimum Tax)

Pass-through Business

Pass-Through Business Deduction (Sec. 199A Deduction)

Patent Box

Payroll Tax

Pigouvian Tax

Profit Shifting

Progressive Tax

Property Tax

Qualified Business Asset Investment (QBAI) Exemption


Refundable Tax Credit

Regressive Tax


S Corporation

Sales Tax

Sales Tax Holiday

Soda Tax

South Dakota v. Wayfair

Standard Deduction

State and Local Tax (SALT) Deduction

Static Scoring

Step-Up In Basis


Supernormal Return




Tax Base

Tax Bracket

Tax Credit

Tax Cuts and Jobs Act (TCJA)

Tax Deduction

Tax Exemption

Tax Expenditure

Tax Gap

Tax Incidence

Tax Pyramiding

Tax Reciprocity Agreement

Tax Refund

Tax Wedge

Taxable Income

Territorial Tax System

Undertaxed Profits Rule (UTPR)

Unemployment Insurance (UI) Taxes

User Fee

Value-Added Tax (VAT)

Ways and Means Committee

Wealth Tax

Windfall Profits Tax


Worldwide Tax System

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