Advanced earned income credit:
Eligible employees can receive the earned income tax credit (EIC) when they file their tax return. Or, by completing Form W-5, Earned Income Credit Advance Payment Certificate, they can get a portion of the credit in advance with their pay. Form W-5 expires on December 31 of each year. A new form must be filed each year in order to continue receiving advance EIC in the next year.

Automated Clearing House (ACH):
Federal Reserve Bank or private financial institution acting on behalf of an association operating a facility that serves as a clearinghouse for direct deposit.

Compensation:
All cash and non-cash remuneration given to an employee for services performed for the employer.

Constructive Receipt:
Occurs when wages are made available to an employee, not when they are earned (paycheck, direct deposit advice form).

Deduction:
An amount subtracted from an employee's gross pay to reach net pay.

Direct Deposit :
The electronic transfer of an employee's net pay directly into financial institutions accounts designated by the employee, thus avoiding the need for a paycheck.

Disposable Earnings:
The part of the employee's check remaining after deductions required by law (taxes); it is used to determine the amount of an employee's pay that is subject to a garnishment, attachment, or child support withholding.

Earned Income Credit:
A tax credit that is available to low-income employees; it may be taken when the employee files his or her individual tax return.

Federal Income Tax Withholding (FITW):
FIT withheld from an employee's wages when they are paid.

Federal Insurance Contribution Act (FICA):
Describes the combined taxes levied for Social Security and Medicare.

Form 1042-S:
A 1042-S Form is a year-end tax document given to a Non-Resident Alien who received wages protected by a tax treaty, or received a Qualified or Non-Qualified Scholarship

Form 8233:
"Exemption from Withholding on Compensation for Independent Personal Services of a Non-Resident Alien Individual" is an IRS-issued form that must be filed by any NRA claiming exemption from Federal income tax withholding based on a tax treaty.

Form I-9:
Immigration & Reform Act Form used to verify identification and eligibility to work.

Form W-2:
Wages and Tax Statement: employers must file a form W-2 to report the total amount of wages paid and taxes withheld for each employee in a calendar year.

Form W-4:
Employee's Withholding Allowance Certificate; the W-4 tells the employer how many withholding allowance the employee is claiming along with the employee's marital status; it also tells the employer if the employee claims exemption from withholding.

Form W-5:
Earned Income Credit Advance Payment Certificate; must be filed by employees who want to take advantage of advanced EIC payments and who attest to their eligibility for the advance payment.

Garnishment:
A legal proceeding that authorizes an involuntary transfer of an employee's wages to a creditor to satisfy debt.

Gross Income:
The compensation for services, including fees, commissions, fringe benefits, and similar items.

Gross Pay:
The total amount received from the employer before any deductions are made.

Medicare:
Federal Hospital Insurance program for individuals age 65 or older and some disabled persons; it is funded through he hospital insurance component of FICA tax

Net Pay:
The part of an employee's wages that remains after all deductions have been subtracted.

Non-Cash Fringe Benefits:
The benefits provided to employees in some form other than cash.

Non-Qualified Scholarship ('Stipend'):
A scholarship received by a non-resident alien via a 'stipend' check.

Non-Resident Alien (NRA):
A foreign national who is on a temporary visa and not making a permanent resident in the U.S.

Qualified Scholarship:
Awards in Qualified Scholarships are applied directly to the student's account - this includes tuition, fees, books, supplies, and equipment.

Resident Alien:
A non-US Citizen making a permanent home in the U.S. A Resident Alien is taxed the same as a US Citizen.

Social Security (OASDI):
Old age, Survivors, and Disability Insurance; a component of FICA

Tax Levy:
Requires employers to deduct an amount of money that the employee owes, plus any penalties and interest payments, from the employee's wages and remit to the proper government agency.

Withholding Tax Calculator:
The purpose of this application is to help employees to ensure that they do not have too much or too little income tax withheld from their pay.