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Internal Revenue Code of 1986

The official set of laws that govern federal taxes in the United States.

Above-the-line deduction

A deduction that reduces a taxpayer's gross income before calculating their Adjusted Gross Income (AGI). This is beneficial because it doesn't require itemizing and can affect eligibility for other tax credits or deductions.

Miscellaneous itemized deduction

A category of deductions for various expenses that can be subtracted from a taxpayer's income if they choose to itemize their deductions. These expenses must exceed 2% of the taxpayer's Adjusted Gross Income (AGI).

Unreimbursed expenses

Costs that an employee pays out of their own pocket for job-related items or services, for which their employer does not pay them back.

Taxable year

The period for which taxes are calculated, typically the calendar year (January 1 to December 31) for most individual taxpayers.

Adjusted Gross Income (AGI)

A key figure on your tax return, calculated by subtracting certain "above-the-line" deductions from your gross income. AGI is used to determine eligibility for many other tax benefits and deductions.