Confused about a specific term or acronym? Solve the mysteries of terminology with this informative resource. Updated regularly with industry-specific vocabulary and concepts, the Glossary provides easy-to-understand definitions of tax-related terms.


Fair Labor Standards Act (FLSA) The Fair Labor Standards Act (1938) regulates minimum wage, overtime pay, and child labor laws for employers and employees covered by the law.

Family Medical Leave Act The Family and Medical Leave Act (FMLA) requires that all covered employers provide their eligible employees with 12 weeks of unpaid leave during any 12-month period for one or more of the following reasons: the birth of a child, placement with the employee of an adopted child, to take care of an immediate family member with a serious health condition, or for leave when the employee has a serious medical condition. This generically refers to both Federal and State laws.

Federal Employer Identification Number (FEIN) The identification number assigned to employers by the Internal Revenue Service to control reporting and accounting functions. Some states will use the FEIN as the core for employer account numbers, but they are not interchangeable.

Federal Income Tax (FIT) A withholding tax levied against employees. The amount of withholding varies with the amount of earnings, frequency of pay, number of claimed exemptions, and marital status.

Federal Information Processing Standard (FIPS) Cod The code on a child support order that identifies the support agency receiving the payment.

Federal Insurance Contribution Act (FICA) FICA is a tax consisting of Social Security and Medicare taxes levied against employers and employees. Employers must match employee Social Security and Medicare tax contributions, using the same rate and taxable wage amounts.

Federally-Assisted Foster Care A program funded in part by the federal government that enables a child to be raised in a household by someone other than his or her own parent.

Federal Parent Locator Service (FPLS) FPLS obtains employer and home address information from federal agencies. The service is operated by the Office of Child Support Enforcement in the U.S. Department of Health and Human Services and assists the states in locating persons responsible for making child support payments. It is also used in cases of parental kidnapping related to custody and visitation disputes.

Federal Reserve Bank (FRB) An independent agency of the U.S. government that plays a central role in monetary policy, the regulation of domestic payment systems (such as Fedwire and ACH), and the regulation of financial institutions. The FRB also acts as the fiscal agent for the U.S. Treasury.

Federal Supplemental Benefits (FSB) A temporary Federal program totally financed by Federal funds that pays supplemental compensation during specified periods of high unemployment to individuals who have exhausted their regular compensation, State-financed additional benefits, and/or the jointly financed Federal/State extended benefits.

Federal Tax Deposit (FTD) The Federal Tax Deposit consists of Federal Income Tax and Social Security/Medicare.

Federal Unemployment Account (FUA) An account in the Unemployment Trust Fund from which repayable advances are available to States whose unemployment fund reserves are temporarily unable to meet current benefit payments.

Federal Unemployment Account (FUA) An account in the Unemployment Trust Fund from which repayable advances are available to States whose unemployment fund reserves are temporarily unable to meet current benefit payments.

Federal Unemployment Tax Act (FUTA) Federal law first enacted in 1939, which sets guidelines for the administration of unemployment compensation programs. All liable employers pay a federal tax to fund administration of State and Federal unemployment insurance programs. These monies are also used to fund extended benefits. States must adhere to the minimum FUTA guidelines in terms of taxation and benefit administration but may set higher standards.


Fedwire An electronic payment system that allows businesses to deposit tax payments using a same-day payment method. Fedwire is currently restricted to taxpayers who are mandated to use the Electronic Federal Tax Payment System (EFTPS). The process must be initiated by a financial institution.

FEIN See Federal Employer Identification Number.

FICA See Federal Insurance Contribution Act.

FICA Tip Credit See Business Tax Credit for Employer-paid FICA on Tips.

Filing Status Marital status of an employee for withholding purposes.

Final Funds Funds that cannot be recalled from the receiving bank using the wire collection method.

FIPS Code The Federal Information Processing Standard code used to identify the child support enforcement agency that issued an order. Not all support orders specify a FIPS code

FIPS Code See Federal Information Processing Standard (FIPS) Code.

Fiscal Year Typically July 1 through June 30 generally, the federal government and some states use October 1 through September 30. (Also see: Calendar Year)

FIT See Federal Income Tax.

Flexible Spending Account A plan in which your employer reduces your earnings to pay for your enhanced medical insurance coverage or child care. Under this plan, you receive medical insurance and child care tax free.

FMLA See "Family Medical Leave Act"

FPLS See Federal Parent Locator Service.

Fraudulent Claim A claim where the claimant has fraudulently claimed benefits by furnishing false information, or has withheld pertinent information deliberately, for the purpose of receiving benefits.

FRB See Federal Reserve Bank.

Fringe Benefit Compensation other than wages provided to an employee such as health and life insurance, vacation, employer-provided vehicles, public transportation subsidies, etc., that may be taxable or non-taxable.

Frozen Wage Credits Under certain circumstances, state law allows for the creation of special benefit year for individuals who were injured, allowing use of a base year prior to the injury. This effectively ìfreezesî those wage credits. Such benefits are not charged to base year employers.

FSDD See Full Service Direct Deposit.

FTD See Federal Tax Deposit.

Full Service Direct Deposit An ADP banking service that enables employers to deposit their employees' wages directly into banks accounts using ADP partner banks.

Fund Balance Ratio The computation each June 30 of the balance in the UI Trust Fund divided by total wages in the preceding calendar year. This calculation determines the tax schedule for the following year; the higher the fund balance ratio, the lower the average tax.

Funds Disbursement A WGPS feature that has ADP make lien payments to the appropriate payee

FUTA See Federal Unemployment Tax.

FUTA Tax Return (Form 940) Annual federal unemployment tax return filed during January of each year. The report calculates the total federal unemployment tax for the completed calendar year. The return details each SUI account number, corresponding taxable wages, tax rate and contributions made.