1. Accounting: Business expenses or losses which are legally permitted to be subtracted from the gross revenue of a firm in computing its taxable income.
2. Logic: See deductive reasoning.
3. Taxation: Fixed amount or percentage permitted by taxation authorities that a tax payer can subtract from his or her adjusted gross income to arrive at the taxable income.
Use 'deduction' in a Sentence
Mitzi was relieved to hear all employees at Flotsam & Jetsam would be receiving health coverage, but miffed when told it would result in yet another deduction from her weekly take home pay.
I was doing my taxes and realized I have spent money in charitable ways so I decided to use a deduction.
When the warehouse was flooded, and all the goods there lost, the company was able to take a deduction in their taxes for the cost of the goods lost.
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Notable Quotable
Deducting Business Travel Expenses
"You can deduct travel costs related to setting up a new business as long as the trade or business you are in is the same as you engaged in previously, as someone else’s employee. For example, if you work for a management consulting firm and decide to go out on your own, incurred costs while setting up your new business are deductible."