KeenHeartbreakingRattlesnake
22:55
Warning
Info
Warning
Info
LSDefine
Simple English definitions for legal terms
disallowance
Read a random definition: common fine
A quick definition of disallowance:
Disallowance: When someone is told they can't have something they asked for. This word is often used when talking about taxes, which are the money people pay to the government. If the government thinks someone asked for too much money back on their taxes, they might say that person's request is disallowed. This can also happen in a situation called bankruptcy, which is when someone can't pay their bills and needs help from the government. If the government decides that someone's request for help is not allowed by the law, they might say that request is disallowed.
A more thorough explanation:
Disallowance means to deny or reject something. In legal terms, disallowance can refer to:
- The IRS denying a deduction or tax benefit claimed on a tax return after an audit
- A court ruling that a claim is not allowable by law in a bankruptcy case
Here are some examples to help illustrate the definition of disallowance:
Let's say a business claims a large deduction on their tax return for expenses that are not actually related to their business. After an audit, the IRS may issue a disallowance, meaning they deny the deduction and the business will owe more taxes.
In a bankruptcy case, a creditor may file a claim for money owed to them by the debtor. If the court determines that the claim is not valid or allowable by law, they may issue a disallowance, meaning the creditor will not receive any payment from the bankruptcy estate.
Overall, disallowance is a legal term that means to deny or reject something, often in the context of taxes or bankruptcy cases.