Real Estate Investment Flashcards Preview

SCC REA 201 > Real Estate Investment > Flashcards

Flashcards in Real Estate Investment Deck (16)
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1
Q

Adjusted Gross Income

A

A federal income tax amount that is determined by subtracting amounts specifically authorized by the internal Revenue Code from gross income

2
Q

Capital Gain or Loss

A

A gain or loss on the sale of a capital asset

3
Q

Cash on Cash Return

A

This shows the return on cash invested. It is calculated by dividing your annual pre-tax cash flow by total cash invested

4
Q

Cost of Recovery

A

The recovery of cost through depreciation for accounting and tax purchases

5
Q

Earned Income

A

Includes wages, salaries, income from a business or profession, and other earned income

6
Q

Effective Rate

A

The average tax rate on all of the individuals’s taxable income

7
Q

Gross Income

A

Includes earned income, portfolio income, passive income, and capital gains and losses

8
Q

Investing

A

Committing capital to a business in order to earn a financial return or profit based on the business entity’s increase in value

9
Q

Itemized Deductions

A

Personal expenses that can be deducted on an income tax return when computing taxable income

10
Q

Leveraging

A

Borrowing money from another source to supplement your own funds in completing the acquisition of property

11
Q

Marginal Rate

A

The rate of tax on the next dollar of income

12
Q

Passive Income

A

Income from a business in which the owner does not materially participate

13
Q

Portfolio Income

A

Income that is a return on invested capital, such as interest and dividends

14
Q

Risk

A

The degree or possibility of loss on an investment

15
Q

Speculation

A

A transaction where the profits are subject to chance; to buy or sell with the hope of profiting through the fluctuations in price

16
Q

Taxable Income

A

The amount for federal income tax purposes computed as follows; gross income less deductions for adjusted gross income less itemized or standard deductions less personal exemptions equals taxable income

Decks in SCC REA 201 Class (75):