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Common Tax Phrases for
Pilots and Flight Attendants
2% Limit
A.G.I. (Adjusted Gross Income)
Above the Line Deductions
Accountable Plan
Actual Cost Meal Deduction
Adequate Records
Alternative Minimum Tax
Below the Line Deductions
CONUS
CPA (Certified Public Accountant)
City-by-City
Commuting Expenses
D.O.T. (Department of Transportation)
Day Trips
Department of State
Displaced
Documentary Evidence
Domicile
Effective Date
Effective Tax Rate
Employee Business Expenses
Enrolled Agent
Expiration Date
General Services Agency
Gross Income
Hours of Service Limits
IRS
IRS Form 1040
IRS Form 2106
IRS Publication 1542
IRS Publication 463
IRS Publication 529
Incidental Expenses
Indefinate Duty
Itemized Tax Deduction
Itenerant
M&IE
Meals
Necessary Expense
Non Taxable Per Diem
Nonaccountable Plan
OCONUS
Ordinary Expense
Per Diem
Per Diem Calculator
Per Diem Deduction
Per Diem Rates
Personal Expense
Prorate
Recordkeeping
Reimbursement
Rest
Schedule A
Seasonal End Date
Seasonal Start Date
Special Per Diem Rates
Standard Deduction
Standard Meal Allowance
Standard Per Diem Rates
Substantiated Expenses
TDY
Tax Attorney
Tax Audit
Tax Bracket
Tax Credit
Tax Deduction
Tax Home
Tax Liability
Tax Preparer
Tax Software
Taxable Income
Taxable Per Diem
Temporary Duty
Transition Period
Transportation Workers
Travel Expenses

Taxable Income

Taxable income is the amount of income a taxpayer uses to calculate tax liability.  Another way of phrasing it would be to say that taxable income is the portion of a taxpayer's income that is subject to taxation.  Not all of a pilot or flight attendant's gross income is taxed.  Various above-the-line deductions and below-the-line deductions affect gross income, thus making taxable income lower.  In the case of pilots and flight attendants, employee business expenses for airline crewmembers are helpful in lowering taxable income and tax liability.

Taxable income is the income amount used in determining tax liability via tax rate tables for a given tax bracket.  If taxable income is too low compared to gross income (meaning the taxpayer had many write-offs and itemized deductions), it is possible that the taxpayer could be subject to the AMT (Alternative Minimum Tax), which affects higher income individuals with many deductions.

Unless the AMT applies, taxable income is related to adjusted gross income as follows:

Adjusted Gross Income - Below-the-Line Deductions = Taxable Income

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