Indefinite Assignment
An assignment that is realistically expected to last for more than one year, whether or not it actually lasts for more than one year, or an assignment that is realistically expected to last for one year or less but actually lasts longer. If your assignment or job away from your main place of work is indefinite, your tax home changes and you cannot deduct your travel expenses. You must include in your income any amounts you receive from your employer for living expenses, even if they are called travel allowances and you account to your employer for them. However, you may be able to deduct the cost of relocating to your new tax home as a moving expense.
Independent Contractor
Generally, a person is considered to be an independent contractor if the employer has the right to control or direct the result of the work but not the means and methods of accomplishing the result. People such as lawyers, contractors, subcontractors, public stenographers, and auctioneers who follow an independent trade, business, or profession in which they offer their services to the public are generally not employees. However, whether such people are employees or independent contractors depends on the facts in each case.
Injured Spouse
When a joint return is filed and only one spouse owes a past-due amount, the other spouse can be considered an injured spouse. An injured spouse can get a refund for their share of the overpayment that would otherwise be used to pay the past-due amount.
Innocent Spouse
By requesting innocent spouse relief, you can be relieved of responsibility for paying tax, interest, and penalties if your spouse did something wrong on your tax return. The tax, interest, and penalties that qualify for relief can only be collected from your spouse. However, you are jointly and individually responsible for any tax, interest, and penalties that do not qualify for relief. The Internal Revenue Service can collect these amounts from either you or your spouse.
Installment Sale
Sales made under arrangements that provide for part or all of the selling price to be paid in a later year. If you finance the buyer’s purchase of your rental property yourself instead of having the buyer get a loan or mortgage from a bank, you probably have an installment sale.
Interest Income
In general, any interest that you receive or that is credited to your account and can be withdrawn is taxable income. (It does not have to be entered in your passbook.)
Inventory
Goods or property held for sale in the course of business or trade. You will generally have inventory if you are a manufacturer, wholesaler, or retailer or if you are engaged in any business that makes, buys, or sells goods to produce income. If you make or buy goods to sell, you can deduct the cost of goods sold from your gross receipts on Schedule C, Profit or Loss From Business. However, to determine these costs, you must value your inventory at the beginning and end of each tax year. If you must account for an inventory in your business, you must use an accrual method of accounting for your purchases and sales.
Investment Interest
Interest paid on loans for which the proceeds are used for investment purposes, such as to buy stock on margin. You can deduct this interest up to the amount of investment income (not including capital gains) you report.
Involuntary Conversion
The receipt of money or other property as reimbursement for the forced disposition of property as a result of theft, casualty, or condemnation. If you receive property as a result of an involuntary conversion, you can calculate the basis of the replacement property using the basis of the converted property.
Itemized Deductions
Personal expenses allowed to be claimed on your tax return as deductions from your adjusted gross income. Examples are medical expenses, mortgage interest, real estate taxes, and charitable contributions. Taxpayers who itemize deductions may not claim the standard deduction.