Glossary


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.


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  • ABA/Trans Code A nine-digit numeric code created by the American Bankers Association that identifies an employer's bank and routing for electronic transactions.

  • Abate Term most often used when requesting an agency to reverse or cancel a penalty charge.

  • Absent Parent The parent who does not live with or have custody of a child but does have responsibility for financial support. A non-custodial parent.

  • Account Balance The sum of all contributions made to an employer SUI account minus benefit charges. Monies in the account are not refundable to the employer.

  • Accrual The recognition of assets, expenses, liabilities or revenues after the cash value has been determined, but before it is transferred.

  • ACH See Automated Clearing House.

  • ACH Credit An electronic payment system where an employer initiates a credit against its bank account one day prior to the payment due date, as requested by the financial institution.

  • ACH Debit An electronic payment system where a company authorizes a debit against its bank account for payments such as payroll taxes.

  • Acquisition See Merger / Acquisition / Divestiture Analysis.

  • Additional Claim An additional claim is a notice of new unemployment filed after a series of claims within a benefit year. There must be a break in filing of one or more weeks with intervening employment and there must be a documented separation.

  • Addressee of Record The address to which the state agency will send unemployment related correspondence. Regulations vary by state as to who can be address of record for different types of documents. Generally, ADP-UCS will act as address of record for clients utilizing the UCM and Total Tax Plus services.

  • Administrative Procedure Method by which support orders are made and enforced by an executive agency rather than by a court and judge.

  • ADP Check An ADP service that enables employers to pay their employees with checks drawn on a bank account maintained and reconciled by ADP.

  • ADP® Automatic Data Processing. (NYSE-ADP).

  • Advance Earned Income Credit (AEIC) Payments of earned income credit during the year to employees who expect to be eligible for the credit. Employers make the payments out of federal income, Social Security and Medicate taxes withheld from the employees’ wages.

  • Advice Number An identifying number for bank purposes. Used on direct deposit vouchers.

  • Advice of Credit (AOC) A government form or coupon indicating the amount of a federal tax deposit. It is to be used by employers when making payments.

  • AE (Account Executive) An ADP associate responsible for converting new clients to ADP's Payroll System and completing the required legal documents for Tax Filing Service clients.

  • AFDC See Aid to Families with Dependent Children.

  • After-Tax Deduction A deduction from an employee’s pay that does not reduce the employee’s taxable wages. It is taken out only after all applicable taxes and other deductions have been withheld (e.g., union dues, garnishments, charitable contributions).

  • Agency Any governmental taxing authority.

  • Agent Bank A bank having a direct working relationship with ADP.

  • Aid to Families with Dependent Children (AFDC) Assistance payments made by state welfare agencies to qualifying families who are deprived of financial support by reason of the death, disability, or continued absence (including desertion) of one of the parents. AFDC is known in many states as ADC (Aid to Dependent Children).

  • Alien An individual living in or visiting the United States who is not a citizen of the U.S. More information can be found in the Alien Immigration, Payments, and Taxation Guide.

  • Alimony Payments made by one spouse to the other, often during or after a legal separation or divorce (also known as spousal support). See also Support Order

  • Allowable Lien Limits Federal and state limitations on the amount of an employee’s wages that can be attached for a lien

  • Alternate Base Year (ABY) Claimants unable to establish a valid claim using a regular base period may use an alternate base period of the last four completed quarters.

  • Amended Rate Once the employer has established an unemployment history, states calculate tax rates annually. An amended rate notice may be issued to reflect a change in any of the components used in calculating the original tax rate. Changes in the tax rate may occur due to voluntary contributions, transfers of experience, employer adjustments to amended quarterly tax filings, removal of benefit charges and/or receipt of a favorable determination resulting from a protest of the components as they appeared on the initial tax rate notice. Changes resulting from state legislation, approved after the issuance of the original tax rate, may also affect the tax rate.

  • Amendment A corrected tax return intended to replace a previously filed quarterly or annual tax return.

  • AOC See Advice of Credit.

  • Applied For Employer Identification Number An Employer Tax Identification Number (EIN) that has been requested from an agency but not yet received.

  • Arrearages Unpaid child support payments and related assessments owed by a parent who is obligated to pay.

  • Assignment of Support Rights When a person receiving public assistance agrees to turn over to the state any right to child support, including arrearages, paid by the obligated parent in exchange for receipt of an AFDC grant and other benefits.

  • Automated Clearing House (ACH) A Federal Reserve Bank acting on behalf of an association of financial institutions that operates a facility (system) that serves as a clearinghouse for direct deposit or other electronic payment transactions; entries are received and transmitted by the ACH under the rules of the association. Funds moved from bank A to bank B must go through the ACH.

  • AutoPay® ADP's primary payroll processing system. AutoPay is used in conjunction with ADP products and services typically targeted to companies with more than 100 employees.

  • Average Taxable Payroll The average of the taxable payrolls of an employer for a specified period immediately preceding the tax rate computation date.