Examples of Nontaxable Income Some investments earn tax-free income, such as the interest on municipal bonds. Typically, withdrawals from your retirement account are taxable, except for Roth retirement accounts. Public assistance programs that offer income to the financially needy are often nontaxable, such as needs-based public assistance from Supplemental Security Income. Also, public welfare funds, no-fault auto insurance disability insurance payments, or disability benefits for which your employer paid the insurance premiums are considered nontaxable....

Definition and Examples of Senior Debt A company issues debt when it needs to raise capital. Senior debt is money the company borrows that will take the highest priority during bankruptcy proceedings if a company goes out of business. Senior debt can be secured debt or unsecured debt. Secured senior debt is backed by collateral. An example of secured debt is a building that’s financed by a mortgage. Such a claim would take the highest priority in bankruptcy because the creditor can foreclose on the building to satisfy its claim....

As far as taxes are concerned, there is no distinction between the business and the individual owner in a sole proprietorship. The owner is entitled to all business profits and is also personally responsible for all debts, losses, and other liabilities. Unlike a limited liability company (LLC) or an S-Corporation, sole proprietors are considered unincorporated. A sole proprietor can exist in a variety of industries. A few common examples include: A freelance graphic designer is considered a sole proprietor of their business....

For example, the following types of income are all taxable for federal income tax purposes: Business and self-employment income Dividends Gambling winnings Most interest income Pass-through income Rental income Royalties Tips Unemployment compensation Wages, salaries, bonuses, and commissions Keep in mind that just because you received a taxable item of income during the year does not necessarily mean you have to pay taxes on it. This is because you are permitted to subtract relevant adjustments and deductions from the amount of your income subject to tax when calculating your tax liability on your tax return, such as Form 1040 for federal income tax purposes....

The Bureau of Labor Statistics (BLS) computes the CPI by taking the average weighted cost of a basket of goods in a given month and dividing it by the weighted cost of the same basket the previous month. It then multiplies this percentage by 100 to get the number for the index. The equation works like this: Alternate Name: CPI for All Urban Consumers (CPI-U)Acronym: CPI How the CPI Works The Consumer Price Index represents the prices of a cross-section of goods and services commonly bought by urban households....

“This federal law prevents debt collection companies from collecting debts from individuals through deceptive, harassing, or abusive processes,” Leslie Tayne, founder and head attorney at debt solutions law firm Tayne Law Group, told The Balance in an email. “This includes using harassing language, calling individuals late at night, and pursuing them for a debt they don’t actually owe.” Some of the practices forbidden by the FDCPA include: Threatening or using violence or other criminal means against the borrower, or the borrower’s reputation or propertyUsing obscene or profane languagePublishing a list of borrowers (except to a credit reporting agency)....

For stocks and higher-risk assets, it usually is. Both foreign and domestic stock markets usually exhibit weak price performance when the headlines are unfavorable. However, U.S. Treasuries — due to their status as one of the lowest-risk investments in the world — actually benefit when the investment backdrop becomes unstable. This phenomenon is known as the “flight to quality” or “flight to safety.” What Is the Flight to Quality, and How Can You Profit When It Takes Place?...

Definition and Examples of the Industrial Goods Sector Industrial goods sector stocks are shares of companies within the capital goods sector. These companies might construct buildings, or manufacture tools and machinery for construction and manufacturing purchase. As of December 2018, this sector represents 9.2% of the S&P 500. Alternate name: Capital goods sector A few examples of companies within the industrial goods sector include: Caterpillar (CAT)Corning (GLW)Emerson Electric (EMR)Deere & Company (DE)...

Definition and Examples of Modified Accelerated Cost Recovery System (MACRS) MACRS is a depreciation method that helps business owners recover tax depreciation costs on equipment and property through deductions taken over a period of time. MACRS is the only depreciation method the IRS accepts. MACRS was enacted in 1987 with the Tax Reform Act of 1986, and it’s been the main method of depreciation for taxpayers ever since. Although there are some exceptions, the MACRS method is used for most properties used for business....

This approach to home valuation, also known as SCA, can be used to set one’s list price, in which a real estate agent analyzes the market and determines a smart price. The sales comparison approach can also be used by professional appraisers who are working for lenders. Their analysis is not focused on how much someone might possibly pay but rather how safe an investment this home is for the lender who will be offering the loan....

The dot plot is published quarterly as a chart showing where each of the 12 members of the FOMC, the rate-setting body within the Fed, expect the federal funds rate to be for each of the next three years and the long term. The Fed is not bound by these predictions, and they change regularly. How the Fed Dot Plot Works The committee is made of up of the seven members of the Fed’s bBoard of Governors, and the president of the Federal Reserve Bank of New York....

The concept is that “unequals should be taxed unequally” and the higher your income, the higher your tax bill should be. Vertical equity goes hand-in-hand with the theory of horizontal equity, which states that “equals should be taxed equally.” Vertical equity is the basis of the United States’ progressive income tax system. This system holds that those who earn more should contribute more to the country’s public services because they can afford to do so....

Klaus Vedfelt / Getty Images Examples of wholesale banking services include: Large fund management Bulk currency exchange Trade transactions Consultancy Working capital financing Mergers and acquisitions Bank-to-bank lending Services Not Provided by Wholesale Banks Wholesale banking doesn’t offer retail and consumer products that are popular among small businesses and consumers, such as: Home mortgagesPersonal deposit accountsSmall-business loansSmall-farm loansConsumer loans Alternate name: Wholesale funding How Wholesale Banking Works Wholesale banking provides much-needed services to institutions that are too large to be effectively managed under retail banking....

Let’s start from the top. Basically, saving money is putting money aside on a regular basis. You spend less money than you earn and put the rest in a savings account at your bank. This should be an automatic part of your monthly budget. Remember, saving money is an important part of being financially successful. Investing is taking this a step further, and putting money into the stock market by buying stocks, bonds, mutual funds, or other investment vehicles....

Typically, warnings ratchet up. First, your boss may informally tell you that there’s a problem. The next step is either a verbal or written warning, both of which are documented. This is a more formal action and can involve human resources. If the behavior is not addressed, the next step may be termination from employment. Here’s what you need to know about what it means to receive a warning at work, and how to respond when you receive one, whether it’s verbal or written....

Here is a step-by-step description of a typical interview, with details on what to expect throughout the process. The Pre-Interview Phase Before going to the interview, you will have already completed a number of steps in the job application process; this is known as the “pre-interview phase.” During this phase, you will have sent a cover letter, resume, and any other required application materials to the hiring manager. You even may have had a phone interview with the manager before being invited in for an in-person interview....

How Financially Sound Is the Homeowner Association? To determine this, ask for and read—yes, they are long, at least 50 pages or more—copies of the following documents: Covenants, Conditions, and Restrictions (CC&Rs) By-Laws and Regulations Meeting Minutes for the last year HOA Financial Statement These documents will tell you about: Special assessments being planned to address deferred maintenanceCapital improvements plannedAmount of cash reservesWhether the association is being or has been suedHistory and likelihood of dues increases...

After you’ve been in business for a year or more, you may be able to get short-term business loans or other forms of short-term financing arises. Short-term loans are usually needed by small businesses for working capital. In addition to loans for working capital, other types of short-term debt financing exist for small businesses. What Is Debt Financing? Debt financing is money that a business owner borrows to operate a business....

Learn more about the discount rate, how it is implemented, and how it affects monetary policy. How Does the Discount Rate Work? Banks are subject to reserve requirements. This means they must maintain adequate deposits to meet potential withdrawals. At the end of each night, some banks fall below this requirement; others have surplus funds. Banks that need to boost their funds overnight often borrow from other banks at the federal funds rate....

It’s important to find out precisely why your employment is being terminated, if there are any steps you can take to have the decision reversed, and what compensation you might be entitled to receive following the firing. Questions to Ask When You’ve Been Fired After you’ve been fired or laid off, the conversation with your employer will depend on the circumstances surrounding your termination, in addition to your personal and professional goals....