What Is the Gift Tax?
06/04/2026
The federal gift tax is a regulatory levy imposed by the IRS on the transfer of money, property, or assets to another individual while receiving nothing or less than full market value in return. Under this system, the person giving the asset—not the recipient—is typically responsible for reporting the transfer and paying any tax due.
What Is “Gift Basis”?
06/04/2026
A gift basis is the asset value assigned to property received as a gift, which the IRS uses to calculate future capital gains or losses if the new owner decides to sell it. Unlike inherited assets, which usually reset to current market rates, gifted items typically retain the original owner’s purchase price and financial history.
What Is “Generation-Skipping Transfer Tax”?
06/04/2026
The Generation-Skipping Transfer Tax (GSTT) is a federal tax imposed on wealth transfers made to a “skip person,” which includes grandchildren, great-grandchildren, or any unrelated individual who is at least 37½ years younger than the donor. This tax functions as a secondary backstop to the standard gift and estate tax system, ensuring that families cannot
What Is “Franchise Tax”?
06/04/2026
A franchise tax is a state-level tax levied on corporations, LLCs, and other formal business entities for the privilege of existing as a legal entity and operating within that state’s boundaries. Unlike standard corporate income taxes, it is not strictly based on a business’s net profits, meaning it can be due even if the company
What Is “Form W-8ECI”?
06/04/2026
Form W-8ECI is an IRS document used by foreign individuals or business entities to declare that the income they receive from U.S. sources is “effectively connected” with an active U.S. trade or business. By submitting this form to an American payer, the foreign person claims a complete exemption from the standard 30% automatic withholding tax
What Is “Form W-8BEN-E”?
06/04/2026
Form W-8BEN-E is an IRS tax document used by foreign (non-U.S.) business entities to certify their foreign status and claim tax treaty benefits. When an international company receives income from a U.S. source, this form prevents the U.S. payer from automatically withholding a standard 30% tax on the payment. It is a self-certification form that
What Is “Form W-8BEN”?
06/04/2026
Form W-8BEN is an IRS tax document used by foreign (non-U.S.) individuals to verify their non-U.S. status for tax purposes. By completing this form, a non-resident alien confirms they are not a U.S. taxpayer and can claim tax treaty benefits to reduce or eliminate U.S. withholding taxes on income earned from U.S. sources. It is
What Is “Form 990-N”?
06/04/2026
IRS Form 990-N, officially known as the Electronic Notice (e-Postcard) for Tax-Exempt Organizations Not Required to File Form 990 or 990-EZ, is an ultra-short annual digital notice submitted to the IRS by small nonprofits. It is designed specifically for organizations with low annual gross receipts, allowing them to satisfy their yearly federal reporting obligations quickly
What Is “Form 990-EZ”?
06/04/2026
IRS Form 990-EZ is a shortened, simplified version of the standard annual informational return that mid-sized tax-exempt organizations and nonprofits file with the federal government. It is designed specifically for entities whose annual gross receipts and total assets fall below certain IRS financial thresholds, allowing them to satisfy their reporting duties with less paperwork. Like
What Is “Form 990”?
06/04/2026
IRS Form 990, officially titled the “Return of Organization Exempt From Income Tax,” is an annual informational return that tax-exempt organizations and nonprofits must file with the federal government. This form tracks the organization’s income, expenses, board governance, and core community programs. Instead of calculating a tax bill, Form 990 serves to demonstrate to the