Glossary
Quick definitions for terms used in our tax education articles.
WorkMinty publishes general educational information for small business owners. It is not tax, legal, or accounting advice. Tax rules change and vary by state and situation. Consult a qualified CPA, enrolled agent, or attorney before making decisions or responding to a government audit.
- 1099-NEC
- Form used to report nonemployee compensation of $600 or more in a calendar year (1099-NEC).
- ABC test
- California test with three prongs (A, B, C) used to determine if a worker is an employee or independent contractor.
- DE 9
- California Quarterly Contribution Return and Report of Wages (DE 9)—employer payroll tax filing.
- DIF score
- IRS Discriminant Information Function score—a computer model that flags returns for potential review.
- EDD
- California Employment Development Department—administers UI, SDI, ETT, and conducts payroll tax audits.
- IDR
- Information Document Request—a formal IRS request for records during an audit.
- Schedule C
- IRS form for profit or loss from a sole proprietorship, attached to Form 1040.
- SDI
- State Disability Insurance—California employee wage withholding for disability benefits.
- UI
- Unemployment Insurance—state payroll tax funding unemployment benefits.
- W-2
- Form reporting annual wages and withholdings for employees.
- PTE elective tax
- California optional tax paid at the partnership or S corporation level, with owners claiming a personal credit—often used in SALT cap planning.
- SALT cap
- Federal limit on deducting state and local taxes on Schedule A (amount varies by tax year and income).
- Trump Account
- Tax-deferred custodial-style traditional IRA for U.S. children under 18, established under federal law including OBBBA provisions.
- TACP
- Trump Account Contribution Program—employer plan for qualified contributions to employees' or dependents' Trump Accounts.