Small Business & Real Estate Glossary

All terms (15)

• BRRRR Strategy
  Also called: Buy, Rehab, Rent, Refinance, Repeat

  A real estate investment strategy: buy a distressed property, renovate it, rent it out, cash-out refinance, and use the proceeds to repeat.

  Used for: rental portfolio scaling, value-add real estate investing, distressed property acquisition
• Cap Rate
  Also called: Capitalization Rate, Cap. Rate

  The ratio of a rental property's net operating income to its purchase price, expressed as a percentage.

  Used for: real estate investing, commercial property valuation, portfolio comparison
• Cash-on-Cash Return
  Also called: CoC Return, Cash-on-Cash

  The ratio of annual pre-tax cash flow to the total cash invested in a rental property, expressed as a percentage.

  Used for: leveraged real estate investing, BRRRR strategy analysis, rental portfolio metrics
• Cost of Goods Sold (COGS)
  Also called: COGS, Cost of Sales

  The direct cost of producing or acquiring the goods a business sells, reported as a deduction from gross revenue on Schedule C.

  Used for: product-based business bookkeeping, Etsy seller tax filing, handmade business margins
• Debt Service Coverage Ratio (DSCR)
  Also called: DSCR, Debt Service Coverage

  The ratio of a property's net operating income to its debt service, used by lenders to underwrite investment property loans.

  Used for: rental property loan underwriting, portfolio lender qualification, commercial real estate financing
• Depreciation (Real Estate)
  Also called: Straight-Line Depreciation, Real Estate Depreciation

  The IRS-allowed annual deduction for the wear-and-tear of a rental property's building portion, spread over 27.5 years for residential and 39 years for commercial.

  Used for: rental property tax planning, real estate investor deductions, cost segregation studies
• Financial Independence Retire Early (FIRE)
  Also called: FIRE Movement, FIRE, Coast FIRE, Barista FIRE

  A financial strategy focused on aggressive saving and low expenses to reach a portfolio large enough to cover living expenses indefinitely without working.

  Used for: retirement planning, financial independence tracking, long-horizon investment planning
• Form 1099-NEC
  Also called: 1099-NEC, Nonemployee Compensation

  The IRS form businesses use to report payments of $600 or more to non-employee contractors during a tax year.

  Used for: freelancer income tracking, contractor tax reporting, business owner 1099 issuance
• Gross Rent Multiplier (GRM)
  Also called: GRM

  The ratio of a property's purchase price to its gross annual rental income, used as a quick valuation screen.

  Used for: initial deal screening, market comparison, portfolio valuation
• Health Savings Account (HSA)
  Also called: HSA

  A tax-advantaged account that lets people with high-deductible health plans save pre-tax dollars for medical expenses.

  Used for: health expense tracking, solo retirement planning, tax-advantaged saving
• Net Operating Income (NOI)
  Also called: NOI, Net Operating Income

  A rental property's gross income minus operating expenses, excluding debt service, depreciation, and capital expenditures.

  Used for: property valuation, loan underwriting, portfolio performance tracking
• Quarterly Estimated Tax
  Also called: Estimated Tax Payments, 1040-ES, Quarterlies

  Federal income tax and self-employment tax paid in four annual installments by taxpayers whose income isn't subject to withholding.

  Used for: freelancer tax compliance, landlord tax planning, self-employed tax scheduling
• Schedule C
  Also called: IRS Schedule C, Form 1040 Schedule C, Profit or Loss from Business

  The IRS form sole proprietors and single-member LLCs use to report business income and expenses on their personal tax return.

  Used for: sole proprietor tax filing, single-member LLC tax filing, solo business bookkeeping
• Schedule E
  Also called: IRS Schedule E, Supplemental Income and Loss

  The IRS form landlords and real estate investors use to report rental property income and expenses.

  Used for: rental property tax reporting, landlord bookkeeping, real estate investor tax planning
• Self-Employment Tax
  Also called: SE Tax, SECA Tax

  The 15.3% federal tax on net earnings from self-employment, covering the employer + employee portions of Social Security and Medicare.

  Used for: freelancer tax planning, solo business quarterly estimates, gig worker tax filing