Glossary articles
Roll call vote definition
A roll call vote is a vote in which each member of a legislative body votes individually, and their vote is entered into the official record. During a roll call vote, members’ names are either called aloud or electronically recorded by a voting station, and each of their votes is documented:s “yea,” “nay,” or sometimes, “present.”Roll call votes create an official public record of how lawmakers vote on legislation, amendments, nominations, and procedural matters. They promote transparency and accountability by allowing constituents to review their representatives’ voting decisions.When is a roll call vote required?Roll call votes aren’t used for every decision in Congress; lots of routine matters are decided by oral vote or unanimous consent. Chamber rules require roll call votes when members formally request a recorded vote, or for certain types of legislative action as defined in the Constitution or chamber rules, or when leadership and/or chamber agreements specify it.1. When members request a recorded voteThe Constitution gives lawmakers in both chambers the right to force a roll call vote if enough of their colleagues support the request.House of RepresentativesIn the House, a roll call vote is required when at least one-fifth of a quorum present supports it. A quorum in the House is a majority of members present (218 people, if all seats are filled).SenateIn the Senate, a roll call vote is required when one-fifth of senators present request it. Senate proceedings often rely on voice votes or unanimous consent, so allowing roll call votes means that senators can demand a public, recorded vote when desired.2. When the US Constitution requires recorded votesIn certain cases, roll call votes are mandatory because the Constitution requires them. These include:Overriding of a Presidential vetoExpelling a member of Congress3. When chamber rules require recorded votes for specific actionsCertain legislative procedures require roll call votes under congressional rules or long-standing practice. Examples include:Senate cloture votes (the process of formally ending a debate or filibuster) Confirmation of presidential nominations Treaty approval in the Senate4. When Leadership or Chamber Agreements Require Recorded VotesSometimes, leadership or negotiated agreements specify that votes must be recorded. This often occurs with:Major or controversial legislationBudget measuresHigh-profile amendmentsWhat is the procedure for a roll call vote?The procedure for a roll call vote varies slightly between the House and Senate, but follows the same general steps.A Representative or Senator requests a roll call vote under their chamber’s rules.The presiding officer determines whether the request meets the chamber’s requirements. If it does, they order the vote.The presiding officer announces the voting period. In the House, electronic votes typically last at least 15 minutes for the first vote in a series, though later votes may be shorter. Senate votes usually remain open until all senators have had an opportunity to vote.Members cast their votes. In the House, most roll call votes occur electronically. Reps insert voting cards into electronic voting stations and select their vote. In the Senate, the clerk typically calls senators’ names alphabetically, and each senator states their vote orally.The presiding officer announces the final tally, which is entered into the official Congressional Record.
Legislative rider definition
A rider is a legislative provision added to a bill or resolution that is often not directly related to the legislation’s main purpose. Riders are frequently attached to larger or must-pass bills to increase the likelihood that the provision will become law.Riders are commonly used to change policy, funding, or regulatory issues that might not pass if considered as standalone legislation. Because they are included in broader legislation, riders are typically debated and voted on as part of the full bill.What are some examples of a rider?Riders frequently appear in appropriations bills, which fund federal government operations. Lawmakers sometimes add provisions that limit how federal funds may be used or require agencies to take or avoid certain actions.Congress has periodically included riders in appropriations legislation that restrict the use of federal funds for specific activities. These riders become legally binding when the larger appropriations bill is enacted into law, even though the rider may address a different policy issue than government funding.What's the difference between a rider and an omnibus bill?Although riders and omnibus bills are both legislative tools that combine multiple issues into a single measure, they serve different purposes.RiderA rider is a single provision attached to a larger bill. Riders often address a policy issue that is separate from or only loosely related to the main subject of the bill. Riders are frequently used to influence policy by attaching provisions to must-pass legislation, such as funding bills.Omnibus billAn omnibus bill is a single piece of legislation that combines multiple measures or subjects into one large bill. Omnibus bills are often used to package numerous appropriations measures or policy provisions together to streamline the legislative process.Unlike a rider, which is typically an add-on provision, an omnibus bill is intentionally structured from the beginning to include multiple topics or legislative initiatives.
Federal Employee Assistance Programs (EAP) definition
A federal Employee Assistance Program (EAP) provides employees with free, confidential support for dealing with both personal or job-related issues. EAPs are voluntary and are meant to help with a range of concerns: stress, grief, family issues, substance use, mental health. They may also advise managers on employee or organizational challenges and assist with preventing or responding to workplace trauma. Services can include assessments, short-term counseling, referrals, and follow-up care.
Order of business definition
The “order of business” is the structured sequence a legislative body uses to conduct its official work during a session. It establishes the schedule and procedural steps for introducing legislation, debating bills, voting, committee reports, and taking other official actions.The order of business ensures that proceedings are organized, predictable, and compliant with each chamber’s rules and precedents. The exact order is governed by the body's standing rules, precedents, and daily leadership decisions.What is the order of business in the House of Representatives?The US House of Representatives order of business is a structured daily sequence established in House rules, though House leadership frequently modifies it with special rules adopted by the House. What does a standard legislative day in the House typically include? 1. Prayer and pledge of allegianceThe session begins with a prayer from the House Chaplain or a guest, followed by the Pledge of Allegiance.2. Approval of the journalReps approve the official record of the previous day’s proceedings.3. One-minute speechesReps have an opportunity to speak briefly on the topic of their choice.4. Introduction and referral of bills and resolutionsLegislation is formally introduced and sent to committees.5. Committee reportsCommittees report legislation or other matters to the House floor.6. Morning hour debate (optional)Reps may give longer speeches on legislation, policy, or public issues of their choosing7. Legislative businessReps debate and vote on bills, resolutions, amendments, and motions.8. Special ordersReps can speak for extended periods after legislative business ends.9. AdjournmentThe House formally ends the legislative day.What is the order of business in the Senate?Senate rules have more flexibility than the House. It has a traditional order of business described in Senate Rule VII but frequently departs from that order through unanimous consent or leadership negotiation, so its order of business is often customized.What does a typical order of business look like in the Senate? 1. Prayer and pledge of allegianceThe Senate session begins with a prayer from the Senate Chaplain or a guest chaplain, followed by the Pledge of Allegiance.2. Approval of the journalSenators approve the official record of proceedings from the previous legislative day.3. Morning businessSenators may deliver speeches, introduce legislation, submit committee reports, and present communications from the President or executive agencies.4. Legislative calendar businessSenators debate, amend, and vote on bills, resolutions, and other legislative measures. 5. Executive businessSenators consider, debate, and vote on presidential nominations and treaties.6. Adjournment or recessThe Senate formally ends or pauses the legislative day.
Shutdown furlough definition
A shutdown furlough happens when there is a lapse in annual appropriations — funding approved by Congress. Shutdown furloughs can happen at the beginning of a fiscal year if no funds have been appropriated, or after expiration of a continuing resolution (CR), if Congress has not passed a new CR or appropriations law.In a shutdown furlough, the affected agency has to stop any activities funded by annual appropriations that are not excepted by law. Employees paid by other non-lapsed sources of funding may be exempt from a shutdown furlough.
Antideficiency Act definition
The Antideficiency Act prohibits federal agencies from spending federal funds during a funding lapse, and from accepting voluntary services. The Act also prohibits agencies from obligating or spending more than the amount Congress has appropriated.A funding lapse happens when Congress hasn’t passed a regular appropriations bill or a continuing resolution (CR) to provide money for a program or agency. A lapse can happen if a CR expires before new funding is approved.
Employment Authorization Document (EAD) definition
An Employment Authorization Document (EAD) is an official card issued by the US Citizenship and Immigration Services (USCIS) that proves a non-US citizen is authorized to work in the United States for a specific period of time. An EAD is also known as Form I-766, or a work permit. EADs are typically issued to individuals in certain immigration categories who are not US citizens or lawful permanent residents but have permission to work in the US.An EAD can be used to apply for a Social Security number, allowing holders to legally accept employment from any US employer.
Congressional recess definition
A congressional recess is a temporary break in the proceedings of the House or Senate during which the chamber is not conducting official legislative business. Unlike adjournment at the end of a congressional session, a recess is a pause within a session, and Congress can return without starting a new session.How long can Congress stay in recess?Under the Constitution, neither the House nor the Senate may recess for more than three days without the consent of the other chamber. If both chambers agree, they can recess for longer periods. The length of a recess can vary widely, from a few days to several weeks, depending on the congressional calendar, holidays, or scheduled district work periods. What are recess appointments?A recess appointment is a temporary appointment made by the President when the Senate is in recess and unavailable to confirm nominees. Recess appointments allow the President to fill vacancies without Senate approval, but they expire at the end of the next Senate session unless the nominee is formally confirmed. Recess appointments are authorized by Article II, Section 2 of the Constitution.
Federal Employees’ Compensation Act (FECA) definition
The Federal Employees’ Compensation Act (FECA) provides disability, survivor, and medical benefits to federal workers injured or made ill on the job, regardless of fault. It also pays them to families of federal employees who die from work-related causes. The Department of Labor (DOL) manages FECA, while individual agencies cover the benefit costs for its employees.In fiscal year 2022–2023, FECA paid $3.3 billion in benefits, including about $2.4 billion in disability benefits, $761 million in medical benefits, and $148 million to the survivors of federal employees.
Continuation of Pay (COP) definition
Continuation of Pay (COP) is a benefit for employees who experience a traumatic injury while working for the government. COP continues the employee’s regular pay for up to 45 days while they are unable to work, as confirmed by an incident report and doctor’s evaluation.COP is part of the Federal Employees’ Compensation Act (FECA), which is the government’s workers’ compensation program. The act provides disability, survivor, and medical benefits to employees injured or made ill on the job, regardless of fault, and to survivors of people who died at work.
Government spending bill definition
A government spending bill is legislation that gives federal agencies the authority to spend money for specific purposes. These bills usually cover one fiscal year and must be passed annually to keep the government running. Government spending bills are officially known as appropriations bills. Who writes the government spending bill?Government spending bills are drafted in Congress, mainly by the House and Senate Appropriations Committees. These committees determine how much money is allocated to each department and program.How does a spending bill become law?At the start of each fiscal year, the president submits a budget proposal to Congress. The House and Senate Appropriations Committees consider, refine, and draft appropriations bills based on the budget, proposing which federal agencies receive funding and how much. There are usually 12 separate annual appropriations bills, but Congress may also roll some or all of them into one, called an omnibus bill. The full House and Senate debate, amend, and vote on their respective versions of the appropriations bills. Then they compare the two bills, reconcile differences, and pass identical versions. Ideally, this happens before October 1 — the first day of the government’s fiscal year.Finally, the spending bill goes to the president for approval or veto. If the president vetoes, Congress can override it with a two-thirds vote in both chambers.
Federal budget definition
The federal budget is the US government’s detailed financial plan for one fiscal year (October 1-September 30). It specifies how much the government will spend, how it will fund that spending, and whether it will run a surplus or a deficit. It’s both a financial plan and a policy statement that reflects national priorities through the allocation of roughly $6 to $7 trillion annually.The federal budget includes mandatory spending (which is required by existing laws like Social Security), discretionary spending (which requires annual congressional approval), and interest on the national debt. It details how the government will collect money (primarily through income taxes) and how it will spend that money. The budget process formally begins with proposals from federal agencies, which are compiled by the Office of Management and Budget (OMB) and submitted to Congress by the president. Congress then debates, amends, and passes the budget through appropriations bills, which the President must sign into law. Creating and approving the federal budget typically takes over a year.
Redistricting definition
Redistricting is the process of redrawing the boundaries of electoral districts to reflect changes in population over time. The redistricting process determines how communities are grouped for political representation and influences who is elected to Congress, state legislatures, and local governing bodies.Redistricting is a state process governed by federal law. States have broad authority to establish and adjust their own redistricting practices, including the timing of redistricting.
Ranking member definition
A ranking member is the most senior member of a congressional committee or subcommittee from the minority party (the party with fewer seats in that chamber). The ranking member serves as the lead spokesperson and coordinator for the minority party on the committee and works opposite the committee chair.Ranking members help shape the minority party’s legislative strategy, negotiate with the chair, and represent their party’s positions during hearings, markups, and investigations.What is the difference between a chair and a ranking member?
Immigration parole definition
Immigration parole is a temporary permission granted by the US government to allow a noncitizen to enter the United States without being formally admitted under standard immigration procedures. Parole is used in urgent humanitarian cases or for significant public benefit. Immigration parole is granted on a case-by-case basis by the Department of Homeland Security (DHS), typically through the US Citizenship and Immigration Services (USCIS) or Customs and Border Protection (CBP).Parole does not confer immigration status and does not constitute admission into the US under the Immigration and Nationality Act. TPS vs. immigration paroleThere are different programs and policies that allow people to enter or remain in the US without granting legal admission. One such program is temporary protected status (TPS), and it provides a helpful point of comparison. While both TPS and immigration parole allow a person to be in the US temporarily, they are different in purpose, legal effect, and eligibility.
Reconciliation bill definition
A reconciliation bill is a special type of legislation Congress may use to make changes to spending, revenue, or the federal debt limit. Reconciliation bills are considered under expedited procedures in the Senate, meaning they can pass with a simple majority (51 votes) and cannot be filibustered. Reconciliation is intended to help Congress more easily align federal laws with the annual budget resolution.How do reconciliation bills fit into the budget process?Each year, Congress passes a budget resolution, which sets overall spending and revenue targets but does not change any laws. If achieving those targets requires modifying existing laws, such as adjusting tax rates, altering mandatory spending programs, or changing the debt ceiling, the budget resolution can include reconciliation instructions.These instructions tell specific congressional committees to draft legislation that meets the budgetary goals. The resulting legislation is typically combined into a single reconciliation bill, which moves through Congress using special fast-track procedures. How often can Congress do a reconciliation bill?Congress can typically pass up to three reconciliation bills per budget resolution, one each for:SpendingRevenue (taxes)The debt ceilingHowever, these can also be combined, meaning Congress often ends up passing one major reconciliation bill per fiscal year. The process is tied to the budget resolution, so if no budget resolution is adopted, reconciliation cannot occur.What is the difference between a reconciliation bill and an appropriations bill?A reconciliation bill is used when Congress’s budget resolution instructs committees to change existing laws related to spending, revenues, or the debt limit so that federal laws match the budget plan.By contrast, appropriations bills provide new discretionary funding for federal agencies each year. If appropriations bills require changes to permanent law (which is uncommon), Congress passes authorization or stand-alone legislation, not a reconciliation bill.
Undocumented immigrant definition
An unauthorized immigrant — also sometimes referred to as undocumented immigrant or illegal immigrant — is someone born in another country and is living in the United States (not a tourist) who does not have the permission of the Federal government to do so.Examples include people who:Enter the country without inspection by immigration authorities by crossing the border undetected between legal ports of entry.Were inspected and admitted to the country on a valid visa, but overstay the specified length of stay.Are temporarily permitted to be in the country without being legally admitted, like while an asylum claim is being processed or through programs like immigration parole, Deferred Action for Childhood Arrivals (DACA), or Temporary Protected Status (TPS). These individuals are allowed to enter or remain in the US by immigration officials, but are considered unauthorized immigrants unless they are granted some other legal immigration status.
Medicaid definition
Medicaid is a joint federal and state program that provides free or low-cost health coverage to eligible low-income individuals and families. Coverage includes certain children, pregnant people, seniors, and people with disabilities, and states may cover additional groups at their discretion. Eligibility is primarily based on a person’s income and financial resources..The program covers a comprehensive range of health services: hospital care, doctor visits, preventive care, prescription drugs, mental health services, and long-term care. Each state administers its own Medicaid program within the federal guidelines, so benefits, eligibility, and coverage do vary from state to state, sometimes significantly.
Pocket veto definition
A pocket veto is a passive form of presidential veto where the president chooses not to sign a bill while Congress is adjourned. Because Congress isn’t in session to receive the bill back, the legislation automatically expires and cannot become law.When a bill is passed by both houses of Congress and presented to the president, the president has 10 days (excluding Sundays) to sign it into law or return it with objections (a regular veto). However, if Congress adjourns during that 10-day period, the president may simply allow the bill to expire. This inaction is considered a pocket veto, and the bill dies.Can Congress override a pocket veto?No, Congress cannot override a pocket veto, because if a pocket veto is executed, Congress is not in session to act. However, Congress can reintroduce the bill and restart the approval process. Who was the last president to use a pocket veto?The last unambiguous use of a recognized pocket veto was by Bill Clinton in December 2000. He allowed the “Bankruptcy Reform Act of 2000” to expire without his signature as Congress adjourned.
Entitlement programs definition
Entitlement programs are government programs, funded federally or jointly with states, that guarantee payments or services to all individuals in the US who meet eligibility rules set by law. Once qualified, people are legally entitled to receive the promised benefits. Funding for most entitlement programs is mandatory, meaning the federal budget automatically includes the funds needed to cover all eligible claims — they’re not subject to the annual spending limits set in the budget appropriations process. The funding comes from a range of sources:Medicaid, Supplemental Security Income, and some other programs are financed by general funds of the US Treasury.Social Security and Medicare are financed through dedicated trust funds that get their money from payroll taxes and, in Medicare’s case, insurance premiums and general revenues.Some veterans' benefits and the Supplemental Nutrition Assistance Program (SNAP) are appropriated entitlements, meaning their eligibility rules are mandatory, but Congress must still pass appropriations to finance them.
Capital gains definition
Capital gains are the profits made when a capital asset — large items that people keep for long periods of time, like personal property, stocks, bonds, mutual funds, collectibles, or real estate — is sold. There are two kinds of capital gains:Short-term capital gains are profits realized from selling an asset a person or organization has held for one year or less.Long-term capital gains are profits realized from selling an asset a person or organization has held for more than one year.If a capital asset is sold at a loss, it’s called a capital loss. How much are capital gains taxed?The amount of capital gains tax depends on which type it is: Short-term gains are taxed at the seller’s ordinary income tax brackets (10%-37% for most taxpayers).Long-term gains are taxed at 0%, 15%, or 20%, depending on the seller’s taxable income and filing status.An additional 3.8% net investment income tax may apply to individuals with modified adjusted gross incomes above $200,000 (for people who are single or head of the household or $250,000 (for married couples filing jointly).What is the capital gains home sale tax exclusion?Selling a house typically triggers a capital gains tax. However, someone selling their main home may be able to exclude (not pay tax on) up to:$250,000 of capital gain if they are single$500,000 of capital gain if they are married filing jointlyAny profit above the $250,000/$500,000 limit is taxable as a capital gain.To qualify for the exclusion, a taxpayer generally must have:Owned the home for at least two years in the five years before selling.Used in the home as their main residence for at least two years during that same five-year period.Not claimed the exclusion on the sale of another home in the past two years.If a taxpayer doesn’t meet the full two-year residency requirement, they may still qualify for a partial exclusion if the sale was due to a change in job, health, or certain unforeseen circumstances.
Alternative minimum tax definition
Some higher-income taxpayers can significantly reduce their tax liability with deductions and credits. The alternative minimum tax (AMT) was created to ensure that these taxpayers still pay a base amount by requiring a separate tax calculation that disallows or limits certain deductions and exclusions that are generally available.Taxpayers whose financial situations trigger AMT calculate their tax liability twice: once using regular income tax rules and once using AMT rules. They then pay whichever amount is greater.
ACA Marketplace definition
The Affordable Care Act (ACA) is a 2010 law that made several changes to the US health insurance system, including expanding Medicaid in some states, allowing young adults to stay on their parents’ plans until age 26, prohibiting coverage denials for preexisting conditions, and creating new health insurance marketplaces.The ACA Marketplace is one part of that law. It is the platform where individuals and families can shop for and enroll in private health insurance plans that meet ACA standards, often with income-based subsidies that lower costs. The Marketplace is a purchasing platform, not a single insurance program.
Earned Income Tax Credit (EITC) definition
The Earned Income Tax Credit (EITC) is a refundable tax credit that helps low-to moderate-income workers. The EITC reduces the amount of federal income taxes they owe. Some taxpayers can also get a refund, even if they owe no taxes.To qualify for the Earned Income Tax Credit, taxpayers must:Have earned income from working (such as wages, salaries, tips, or self-employment).Meet income limits based on filing status and the number of qualifying children they have. (The IRS updates these thresholds each year.)Have a valid Social Security number. Spouses and qualifying children must also have Social Security numbersFile taxes using an allowable status — taxpayers who file as Married Filing Separately are not eligible for the EITC.Be a US citizen or resident alien for the entire filing year (or meet certain special rules, if the filer is a nonresident alien).Not be claimed as a dependent or qualifying child on someone else’s tax return.Have investment income below the annual limit set by the IRS. (This limit is also updated annually).Meet three criteria, if they do not have a qualifying child:Be at least 25 years old but under 65 at the end of the tax yearLive in the US for more than half the yearNot qualify as someone else’s dependent
Standard deduction vs. itemized deduction definition
Standard deductions and itemized deductions are two different ways to reduce the taxable income reported on federal income tax returns. The standard deduction is a fixed dollar amount available to nearly all taxpayers based on filing status. By contrast, itemized deductions are specific expenses that taxpayers may claim instead of the standard deduction.The standard deduction lets filers deduct a fixed dollar amount from their taxable income. The amount changes based on a person’s filing status (Single, Married Filing Jointly, Head of Household, etc.), with increases possible for taxpayers who are blind or age 65 or older. Amounts for all statuses are typically adjusted each year for inflation. No additional tax forms are needed to take the standard deduction.Itemized deductions let taxpayers deduct specific expenses from a list of allowable deductions. Common itemized deductions include state and local income or sales taxes, gifts to a qualified charity, and home mortgage interest. Filers itemizing deductions need an additional tax form: itemized deductions must be listed on Schedule A (Form 1040 or 1040-SR).Itemized deductions may be affected by a taxpayer’s income level. While the standard deduction is a fixed amount determined by filing status, many itemized deductions have income-based limitations. Certain deductions, such as medical expenses, casualty losses, and charitable contributions, can only be claimed to the extent they exceed a percentage of Adjusted Gross Income (AGI), while others are capped at a statutory dollar limit (such as the $10,000 cap on state and local taxes). As a result, the amount of allowable itemized deductions often varies with the taxpayer’s income.Taxpayers must choose one deduction method; it’s not possible to take the standard deduction and itemize.
Fiscal policy definition
US fiscal policy is the sum of all the federal government decisions on how spending and taxation should influence economic growth, employment, and inflation. It involves decisions on how much money the government collects (through taxes) and how much it spends (on programs, services, and infrastructure).
Continuing resolution definition
A continuing resolution (sometimes called a CR) is an act of Congress providing temporary funding that keeps federal agencies and programs operating when Congress hasn’t passed any regular appropriations bills by the start of the fiscal year (October 1).Continuing resolutions typically continue funding the government at roughly the same levels as the prior year (or with minor adjustments) for a limited time. They’re often passed as joint resolutions.
Budget resolution definition
A budget resolution (also known as a concurrent resolution) is the second step in the government budget process. It's preceded by the president’s budget request and followed by budget hearings in both the House and Senate. The resolution itself is a blueprint, adopted separately by the House of Representatives and the Senate, for federal spending, revenues, deficits or surpluses, and public debt for the upcoming fiscal year — along with projected plans for at least the next five years. The budget resolution gives Congress a framework for considering subsequent spending, revenue, and debt-limit legislation. It establishes overall totals, not line-item details. Congress is supposed to pass a budget resolution by April 15 each year (but they frequently miss the deadline).
Debt ceiling definition
The debt ceiling (or debt limit) is the legal maximum amount of money the US Treasury is allowed to borrow to meet the government’s existing financial obligations. These obligations include Social Security and Medicare benefits, military salaries, interest on the national debt, tax refunds, and other payments. The debt ceiling does not authorize new spending; it allows the government to finance obligations Congress and the president have already approved.
Asylum definition
Asylum — permission to stay in the US — a protection available to people already in the country (or who are arriving at a port of entry) who meet the legal definition of “refugee,” someone unable or unwilling to return home because of persecution or a well-founded fear of persecution. To request asylum, an individual files Form I-589 with US Citizenship and Immigration Services (USCIS) or raises the claim during immigration court proceedings. The government reviews the application, interviews the applicant, and checks whether the claim fits US asylum law. A decision is then made to grant asylum, deny it, or continue the case in immigration court.
Tax credit vs. tax deduction definition
Tax credits and deductions are similar but different methods of reducing one’s income tax liability. Tax deductions are subtracted from a taxpayer’s adjusted gross income (AGI), which reduces taxable income. Tax credits are subtracted directly from the total amount of taxes someone owes. Tax credits are generally granted for specific situations and are for a specified amount. For example, the Child Tax Credit allows eligible taxpayers to claim up to $2,000 per qualifying child under age 17, directly reducing the amount of federal income tax they owe.
Customs definition
Customs refers to the rules and procedures of moving goods in and out of countries. A country’s customs organization facilitates international trade by ensuring its compliance with relevant laws and regulations and collecting tariffs. Customs includes:Enforcing import and export lawsCollecting duties and taxesScreening goods and travelers at ports of entrySeizing prohibited or dangerous itemsVerifying documentation of imports and exportsProtecting a country’s economic, health and security interests at the border
Tariff classification definition
A tariff classification is the process of identifying and categorizing an imported good. When goods are imported into the US, the importer must declare them to US Customs and Border Protection (CBP). As part of this process, the importer is responsible for correctly classifying the goods under the US Harmonized Tariff Schedule, assigning them a value, and providing accurate information so CBP can assess duties, collect trade data, and apply any restrictions like quotas or embargoes.
Harmonized System (HS) definition
The Harmonized Commodity Description and Coding Systems, generally referred to as the Harmonized System or HS, is an international product nomenclature developed by the World Customs Organization (WCO). The HS contains about 5,000 commodity groups, each identified by a six-digit code, with specific rules to enable uniform classification. The Harmonized System is used by more than 200 countries as the basis for their customs tariffs and international trade statistics. More than 98% of internationally traded merchandise is classified in the Harmonized System.
Smuggling definition
Smuggling refers to the illegal importation or concealment of goods or people in violation of laws or customs regulations.What is goods smuggling?Goods smuggling refers to bringing undeclared products into a country. People arriving in the US, whether citizens, residents or visitors, must notify authorities of the goods they are bringing with them by filling out a Customs Declaration. Attempting to import goods that must be declared by using false invoices or documents, or knowingly importing, hiding, selling, or helping move goods that were brought in illegally, can result in fines and/or detention. US Customs and Border Protection (CBP) enforces the laws regarding bringing prohibited or restricted items into the US. Prohibited items are forbidden by law from entering the US. Examples include dangerous toys, cars that don’t meet US safety standards, bush meat, and illegal drugs. Restricted items require special licenses or permits to import to the US. These include firearms, certain fruits and vegetables, plants, biological specimens, and pets. What is human smuggling?Human smuggling refers to illegally bringing foreign people into a country. Vulnerable people pay smugglers to get them into a country because they don’t have a legal immigration pathway. This can lead to violence, abuse, or extortion. US law prohibits knowingly smuggling unauthorized immigrants into the country, and it can result in penalties including fines and/or imprisonment. US Immigration and Custom Enforcement’s (ICE) Homeland Security Investigations investigates and prosecutes human smuggling.
Cost basis definition
The cost basis of an asset is generally the amount paid for it, including fees, taxes, or commissions; in some cases, as with inherited property, it may be the fair market value of the asset at the time of acquisition. Cost basis is used to calculate taxes owed on any capital gain or loss resulting from the asset’s sale. What is the difference between cost basis and purchase price?For most assets, the cost basis is the original purchase price plus any allowable acquisition costs, plus/minus adjustments over time. Adjustments may include improvements to or depreciation of the asset. How is cost basis determined when selling a home?The cost basis of a home when selling it depends on how the seller first acquired the property. The cost basis of purchased property includes the purchase price, closing costs, settlement fees, and any improvements made, minus casualty loss and any other decreases; for self-built property, it’s the total cost of constructionThe cost basis of inherited and gifted properties is generally based on the fair market value of the home at the time of the original owner’s death or of the gift. Some additional Internal Revenue Service (IRS) rules also apply to gifts.
Tariff rate definition
A tariff is a tax on certain imports set by law. A tariff rate can be either a fixed amount (a “specific” tariff) or a percentage of value (an “ad valorem” tariff). The government can set different tariff rates on different products based on the exporting country. When goods cross the US border, the importer pays the relevant tariff to Customs and Border Protection (CBP) based on the rate for the type of goods, their quantity or value, and which country they’re coming from.
Appropriations bill definition
An appropriations bill is a type of legislation Congress passes to grant budget authority from the US Treasury, allowing federal agencies and programs to incur sending obligations and make payments for specific purposes over a set period (typically one federal fiscal year).Appropriations bills are a key part of the discretionary spending process. They determine how much funding each department, agency, or program receives and under what conditions.Congress has 12 appropriations subcommittees, and each is responsible for drafting one annual appropriations bill covering its area of government. Sometimes, instead of being passed individually, these 12 bills are packaged together into a single measure called an omnibus appropriations bill.Appropriations bills are part of the government budget process. Before appropriations bills are drafted, the President annually submits a budget request to Congress, which informs the budget resolution and appropriations process.After both chambers of Congress pass an appropriations bill, it is sent to the President for approval. If signed, it becomes law and provides funding authority.
Customs union definition
A customs union is a trade agreement among countries that removes tariffs on trade among members while requiring them to adopt a common external tariff (or customs duties) and coordinated border policies for trade with states that are non-members. The oldest is the Southern African Customs Union, founded in 1910. Its members, Eswatini, Botswana, Lesotho, Namibia and South Africa, have a common external tariff, and each country has an internal tax that applies to imports from the other member states as well as from third countries.
Export tariff definition
An export tariff, also called an export duty, is a tax imposed by a government on domestic goods that are being sold abroad. Export tariffs can be charged as a percentage of the item’s value or as a fixed fee per unit.
Bonded warehouse definition
A US Customs bonded warehouse is a secure facility where imported goods can be stored, processed, or manufactured for up to five years without paying duties. Using a bonded warehouse to store imported goods has some financial advantages, such as delaying the tariffs due until domestic buyers are found. Duties do not apply if the goods are reshipped to foreign markets.
Merit Systems Protection Board (MSPB) definition
The Merit Systems Protection Board (MSPB) is an independent executive branch agency that oversees federal employee merit systems. The MSPB’s mission is to protect merit-system-based hiring and ensure the federal workforce is free from prohibited personnel practices. The MSPB handles employee appeals, conducts merit system studies, and reviews Office of Personnel Management (OPM) actions that may impact merit principles.
Adjusted Gross Income (AGI) definition
Adjusted Gross Income (AGI) is the total of a taxpayer’s income from all sources, minus any allowable adjustments to income, as listed on Schedule 1 of Form 1040. Adjustments to income may include things like contributions to a traditional Individual Retirement Account (IRA) or student loan interest.AGI is calculated before either the standard deduction or itemized deductions are applied.
State and Local Tax (SALT) deduction definition
The state and local tax (SALT) deduction is a federal itemized tax deduction that lets taxpayers subtract certain state and local income, property, or sales taxes from their federal taxable income. This helps reduce double taxation on the same income.According to the Internal Revenue Service (IRS), the allowable deduction for SALT on Schedule A is currently capped at $10,000 per year ($5,000 if you’re married and file separately). However, for tax year 2025, the SALT deduction changes as a result of the One Big Beautiful Bill Act.
Immigrant visa definition
There are two US visa categories: immigrant and nonimmigrant. Immigrant visas are issued to foreign nationals who intend to live in the US permanently. Nonimmigrant visas are for foreign nationals to come to the US temporarily, such as for tourism, business, short-term work, study, medical treatment, or other reasons.An immigrant visa is issued by a US embassy or consulate abroad to a person who has been approved to live permanently in the United States. The immigrant visa allows a foreign national to travel to the US, where they will be inspected by a Customs and Border Protection (CBP) officer at a port of entry. Once admitted to the United States, they become a lawful permanent resident, also known as a green card holder.
Deferred Action for Childhood Arrivals (DACA) definition
Deferred Action for Childhood Arrivals (DACA) is a US immigration policy, announced in 2012, that allows certain undocumented immigrants who came to the country as children to receive temporary protection from deportation and eligibility for a renewable work permit. DACA does not provide lawful immigration status or a path to citizenship.Is a DACA recipient considered a US citizen?No. DACA recipients are not US citizens or lawful permanent residents. They have temporary, renewable protection from deportation for two years and can apply for permission to work, but they do not have the same rights and benefits as citizens.DACA recipients are foreign nationals without permanent resident status (green card), but are considered lawfully present while their temporary protection status is in place. DACA recipients cannot vote, receive federal financial aid for college, or access many federal benefits that are available to citizens and legal permanent residents.
Resident alien, nonresident alien definition
“Resident alien” and “nonresident alien” are terms the Internal Revenue Service (IRS) uses for tax purposes. They are not immigration classifications, although they can overlap with immigration status. A resident alien is a noncitizen who meets IRS criteria for tax residency. A nonresident alien does not meet those criteria, even if they reside in the United States temporarily.In other words:A resident alien is a noncitizen who meets certain conditions that require them to pay taxes to the United States. These conditions include holding a green card or being physically present in the US for a specified time.A nonresident alien is a noncitizen who does not meet those conditions and is only subject to US taxes on income from US sources.
Economic indicators definition
Economic indicators measure the performance and health of an economy. Policymakers and economists use this economic data to assess current conditions and predict future trends. Common economic indicators include gross domestic product (GDP), unemployment rates, inflation, and consumer spending.Classifying economic indicators Economic indicators are divided into three categories:Leading indicators: these predict future economic activityLagging indicators: measure trends after they occurCoincident indicators: fluctuate as the overall economy movesEconomic indicators examplesHere are some of the most common economic indicators, grouped by type.Leading economic indicatorsConsumer confidence index: measures how optimistic consumers are about the economy.Stock market performance: reflects investor sentiment and expectations.Building permits: indicates future construction activity.Manufacturers' new orders: suggests future production volume.Average Weekly Hours (Manufacturing): longer hours often signal upcoming growth.Lagging economic indicatorsUnemployment rate: measures the percentage of the labor force that is jobless and actively seeking work.Corporate profits: reflects past economic activity and business performance.Labor cost per unit of output: indicates changes in wage pressures and productivity.Outstanding loans to businesses and consumers: tracks borrowing activity after economic shifts.
Fiscal year definition
A fiscal year is an accounting period businesses, governments, and other organizations use to track and report on their financial performance. Fiscal years can begin at any point in a calendar year and are typically 12 months long. A fiscal year allows an entity to accommodate seasonal demands and lends flexibility to the financial reporting process. Organizations may choose a fiscal year that is different from a calendar year because some industries, like retailers, for example, have clear busy and slow seasons. Aligning the fiscal year to end right after the busy season makes it easier to measure performance and forecast for the year ahead. Likewise, agricultural businesses often start their fiscal year after harvest to match revenue recognition with the production cycle.Companies often match their fiscal year with others in the same industry so that investors, analysts, and regulators can compare performance more easily. Many tech companies use a July-to-June fiscal year to align with budgeting and product release cycles common in the sector.What is the difference between a calendar year and a fiscal year?While a calendar year starts in January and ends in December, a fiscal year might begin at another time. For example, Microsoft’s fiscal year runs from July 1 to June 30. Other organizations might choose a fiscal year that runs from July 1 to June 30, or another 12-month period that suits their operations.Fiscal year for governmentThe fiscal year for the United States government begins in October and ends in September of the following year. State and local governments often follow a similar fiscal year calendar, but some do not. How long is a fiscal year?A standard fiscal year spans 12 consecutive months or 52 to 53 weeks. However, if a business starts mid-year or changes its accounting cycle, its fiscal year may be shorter or adjusted accordingly. Also, if a business changes its accounting period, that may affect the length of its fiscal year.
Nonimmigrant visa definition
A nonimmigrant visa allows a foreign national to travel to the US temporarily for purposes like tourism, business, study, or certain types of temporary work. There are dozens of nonimmigrant visa categories, each with its own eligibility requirements and rules. Having a nonimmigrant visa does not guarantee entry to the United States. Final admission is determined by a Customs and Border Protection (CBP) officer at the port of entry.Foreign nationals generally obtain nonimmigrant visas at a US embassy or consulate abroad.
Deportation vs. voluntary departure definition
Deportation is an informal term for what the US government calls a removal. A removal is a formal process where the government forces a non-US citizen to leave the country because they have violated immigration laws. Deportation results in an official removal order, is recorded in immigration databases, and usually carries a reentry bar of several years or more.Voluntary departure is when a non-US citizen agrees to leave the United States at their own expense, within a set time frame, before or during removal proceedings. Voluntary departure is granted by an immigration judge or the Department of Homeland Security (DHS) under certain conditions.
Birthright citizenship definition
Birthright citizenship is the legal right to US citizenship for anyone born in the United States or its territories (except American Samoa), regardless of the parents’ citizenship or immigration status. There are limited exceptions, such as for the children of foreign diplomats. This principle is established in the 14th Amendment to the US Constitution and clarified in federal law.What is the difference between naturalized and birthright citizenship?Birthright citizens are US citizens from the moment of birth, either because they were born in the US (jus soli) or born abroad to US citizen parents who meet certain residency or physical presence requirements (jus sanguinis).Naturalized citizens are people not US citizens at birth but became citizens later through the legal process of naturalization.Both have the same rights, protections, and responsibilities, except that only natural-born citizens are eligible to serve as president or vice president.What is the Birthright Citizenship Act of 2025?The Birthright Citizenship Act of 2025 refers to two related but distinct actions taken in January 2025:1. Executive Order: President Trump signed an executive order titled “Protecting the Meaning and Value of American Citizenship” that attempts to restrict birthright citizenship for children born in the United States after February 19, 2025. The order directs federal agencies not to recognize US citizenship for children born when the mother was unlawfully present and the father was not a US citizen or lawful permanent resident, or the mother's presence was lawful but temporary, and the father was not a US citizen or lawful permanent resident. The executive order has faced immediate and widespread legal challenges. Litigation is ongoing, and the executive order is not currently in effect pending court decisions.2. Congressional Legislation: The Birthright Citizenship Act of 2025 was introduced by Sen. Lindsey Graham (R-South Carolina) in the Senate (S. 304) and Rep. Brian Babin (R-Texas) in the House (H.R. 569), aiming to limit US citizenship at birth to children with at least one parent who is a US citizen or national, a lawful permanent resident residing in the US, or a non-US national with lawful immigration status performing active service in the Armed Forces. As of now, neither bill has been passed into law; both remain pending in Congress.Does a baby born in the US get citizenship?Yes, under current law, almost every baby born in the United States or its territories automatically becomes a US citizen at birth, regardless of the parents’ immigration status, except for certain children of foreign diplomats or enemy forces in hostile occupation.
Temporary visa overstay definition
A visa is a document issued by a US embassy or consulate that allows a foreign national to travel to the US for a specific purpose (such as tourism, study, or work) and for a limited period of time. A temporary visa overstay occurs when a non-US citizen remains in the country past the expiration date of their authorized stay. The date a temporary visa overstay begins is determined by the date shown on the Form I-94 Arrival/Departure Record, not the expiration date printed on the visa in the passport. Someone who overstays their visa is considered no longer in lawful immigration status, with a few exceptions.
Naturalization definition
Naturalization is the legal process through which a non-US citizen voluntarily becomes a US citizen after meeting specific eligibility requirements. These typically include a period of lawful permanent residence, good moral character, and passing English and civics tests.Upon naturalization, individuals receive a Certificate of Naturalization as proof of their US citizenship and gain all the rights and responsibilities of citizenship, including the right to vote and hold most public offices.
Healthcare, health insurance definition
Healthcare refers to the maintenance or improvement of health through prevention, diagnosis, treatment, and management of illness, injury, and other physical or mental conditions. It includes services provided by medical professionals, hospitals, clinics, pharmacies, and other facilities.In everyday conversation, “healthcare” is sometimes used to mean health insurance, but they are not the same. Health insurance is a financial product, a contract between you and an insurance provider, that helps pay for healthcare. Health insurance is the means to pay for healthcare, not healthcare itself.
Green card definition
A green card is the unofficial name for a Permanent Resident Card, issued by the United States Citizenship and Immigration Services (USCIS). Green card holders are lawful permanent residents (LPRs) and have the right to live and work permanently in the United States.Green card holders have many of the same responsibilities and protections as US citizens, but they do not have full political rights, such as voting or holding certain federal jobs.
Budget deficit definition
A budget deficit occurs when a government’s annual spending (also called “outlays”) exceeds its annual revenue (“receipts”). In other words, the government spends more money than it collects through taxes and other income sources in a given fiscal year. To cover this shortfall, the government borrows money, which increases the national debt.