Tax Exemption
/ˈtæks ɪɡˌzɛmpʃən/
Definitions
- (n.) A legal provision that exempts a person, organization, or transaction from the obligation to pay certain taxes.
Nonprofit organizations often qualify for tax exemption under federal law.
- (n.) Status granted by law that excludes a taxpayer from some or all tax liabilities.
The property received tax exemption due to its use for public purposes.
Related terms
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Commentary
Tax exemption is distinct from tax deduction and credit; it entirely removes the tax obligation rather than reducing taxable income or tax due.
This glossary is for general informational and educational purposes only. Definitions are jurisdiction-agnostic but reflect terminology and concepts primarily drawn from English and American legal traditions. Nothing herein constitutes legal advice or creates a lawyer-client relationship. Users should consult qualified counsel for advice on specific matters or jurisdictions.