Glossary

An insurance policy rider that waives premium payments if the insured becomes permanently disabled.

If you need help preparing your taxes visit the Volunteer Income Tax Assistance (VITA) office nearest you. Many VITA offices have IRS representatives who can help you fill out your forms and then transmit the information on your forms electronically.

A type of life insurance that provides coverage for the insured's entire life as long as the policyholder pays the premiums. Whole life insurance also has a cash value component that can be drawn upon to meet financial needs.

A system that takes a certain amount from an employee's paycheck to pay for, completely or partially, that employee's income tax for the year. This money is used to pay for federal income taxes, state and local income taxes, federal social security and Medicare taxes.

An allowance an individual claims on a W-4 Form. It is mainly used to assist an employer in calculating the amount of income tax to withhold from an employee's paycheck. The more allowances you wish to claim, the less income tax will be withheld from your paycheck. You can claim one allowance for yourself, one for your spouse, and one for each of your dependents.

Money that ensures a business's ability to operate on a daily basis.

To transfer an item that was an asset to an expense account. For example, to transfer an uncollectable account receivable to bad debts expense.