Industry Related Definitions
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H
Head of Household
The filing
status used by an unmarried taxpayer who pays over half the cost of
maintaining his home that is the principal residence for over half the
tax year of his unmarried child or other lineal descendent (this child
does not have to be a dependent) or of his dependent married child or
other qualified relative. A dependent parent who does not live with
the taxpayer may also qualify the taxpayer for the head of household
status if qualifications are met.
Historical
Cost
An
accounting principle requiring all financial statement items to be
based on original cost.
Hobby Loss
A
nondeductible loss arising from a personal hobby as contrasted with a
loss arising from an activity engaged in for profit.
Holding Period
The period of time property has been owned for income tax purposes.
The holding period determines if gain or loss from the sale or
exchange of a capital asset is long or short term.
Home Office Expenses
Expenses
of operating a portion of a residence used for business or
employment-related purposes. Several restrictions limit the deduction
for home-office expenses.
Hope Scholarship Credit
A nonrefundable credit of up to $1,500 per qualified student for
tuition and fees paid for the first two years of post-secondary
education.
Household Employee
An
individual who performs nonbusiness services for the taxpayer in or
around the taxpayer's home. Such services include child and dependent
care, house cleaning, cooking, and yard work.
Household Expenses
A portion
of total support; the value of lodging plus food consumed in the home,
utilities paid, and repairs made. The total is divided equally among
all family members. Each member's share of household expenses is part
of his or her total support.
Husband and Wife
A status
that, among other things, entitles a couple to file a joint income tax
return. For the purpose of joint returns, common-law marriages are
recognized only if the state in which the two persons reside
recognizes such marriages or if the state in which the marriage began
recognizes common-law marriages. The status as husband and wife on the
last day of the tax year governs the right to file a joint return.
Hybrid Method of Accounting
A
combination of accounting methods, usually of the cash and accrual
methods.
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