Phantom Taxed: What Is Phantom Income and How to Avoid Being Taxed on Money You Never Received
Warren Team
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Key terms
- Debt-to-Income Ratio (DTI)The percentage of your gross monthly income that goes toward paying debts. Lenders use DTI to assess your ability to manage monthly payments and repay borrowed money.
- Gross IncomeTotal income earned before taxes and deductions. For individuals, it includes wages, tips, investment income, and other earnings.
- Money Market AccountA savings account that typically offers higher interest rates than regular savings accounts but requires higher minimum balances. May include limited check-writing privileges.
- Net IncomeIncome remaining after all deductions, taxes, and expenses are subtracted from gross income. Also called take-home pay for individuals or net profit for businesses.
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