1
1031 exchange
A tax-deferred swap of investment real estate for like-kind property under IRC § 1031, executed through a qualified intermediary on strict deadlines.
4
401(k)
An employer-sponsored defined-contribution plan funded largely by employee salary deferrals.
403(b)
A retirement plan for public-school and certain tax-exempt employees, similar to a 401(k).
457(b)
A deferred-compensation plan for state, local government, and some nonprofit employees.
A
Accredited investor
An investor who meets income or net-worth thresholds allowing access to certain private offerings.
Accumulation trust
A trust that may retain retirement-account distributions rather than passing them out — stronger protection, taxed at compressed trust rates. Design guide.
Algorithmic stablecoin
A stablecoin that tries to hold its peg through supply-and-demand mechanisms rather than hard reserves; historically the most failure-prone design.
Alternative asset
An investment outside traditional public markets, such as real estate, private equity, private credit, metals, or digital assets.
Anti-money laundering (AML)
Laws and controls that detect and prevent money laundering and terrorist financing — sanctions screening, transaction monitoring, and reporting of suspicious activity. In the U.S. the framework rests on the Bank Secrecy Act, enforced by FinCEN.
Asset allocation
How a portfolio is divided among asset classes to balance risk and return.
Assets under administration (AUA)
Assets a firm administers but does not necessarily manage — distinct from assets under management.
Assets under management (AUM)
Assets a firm manages on an investor’s behalf.
Authorized signer
A person permitted to execute transactions for an account or entity, within a defined scope. The Investor Passport maps signer authority and enforces it per record.
B
Bank Secrecy Act (BSA)
The 1970 U.S. statute that anchors anti-money-laundering law: financial institutions must keep records, verify identities, and file reports (SARs and CTRs) that help regulators detect financial crime.
Basis
After-tax money in an account; tracked so it isn’t taxed again on withdrawal.
Basis point
One hundredth of one percent (0.01%); 100 basis points equal 1%.
Beneficial ownership
The natural persons who ultimately own or control an entity. Verified once and reused when opening entity accounts.
Beneficiary
The person or entity designated to receive an account after the owner’s death.
Beneficiary designation
The form that names who inherits an account, which generally overrides a will.
Blockchain
A distributed, tamper-resistant digital ledger that records transactions across a network of computers.
Broken object-level authorization (BOLA)
A common flaw where a system checks who is calling but not whether they may access the specific record; the gap per-record authorization closes.
Business development company (BDC)
A regulated vehicle that lends to smaller U.S. companies, and a common route into private credit for an individual account. Listed BDCs trade on an exchange; non-traded BDCs offer periodic repurchases. Typically leveraged, which can create UDFI in a retirement account.
C
Capital call
A request from a private fund for investors to contribute committed capital.
Capital commitment
The total amount an investor agrees to contribute to a fund, drawn over time via capital calls.
Carried interest
The general partner’s share of fund profits, typically paid after a preferred return.
Catch-up contribution
An additional contribution allowed for participants at or above a set age.
Change of circumstance
An event — a new address, citizenship, ownership change, or expired document — that can invalidate a verified credential and trigger a refresh.
Checkbook control
An arrangement where an IRA owns an entity the owner manages — which adds responsibilities and risks, not a shortcut around the rules.
COBRA
The right to continue employer group health coverage after qualifying events, at full unsubsidized cost, with a 60-day retroactive election window. The decision.
Complexity premium
Return attributed to manager skill in genuinely difficult situations rather than to holding an asset class. It is earned, not paid automatically — which is why sponsor evaluation matters. See vetting a sponsor.
Conduit trust
A trust required to pass each retirement-account distribution straight to its beneficiary — simpler taxes, protection that ends where the money lands.
Consent grant
Your explicit, revocable permission to release specific profile records to a specific recipient for a specific purpose.
Cost basis
The amount used to measure gain or loss on an investment, generally what you paid plus adjustments.
CRS (Common Reporting Standard)
An international framework for the automatic exchange of financial-account information between tax authorities. Your tax classification is captured once and reused.
Currency transaction report (CTR)
A report a financial institution must file with FinCEN for cash transactions exceeding $10,000 in a single day. Structuring deposits to stay just under the threshold is itself a crime.
Custodial agreement
The contract governing how an account is held and administered by the custodian.
Custodian
An entity that holds assets and processes transactions; it does not, by holding an asset, recommend or approve it.
Custody
The safekeeping and administration of assets on an owner’s behalf.
Customer due diligence (CDD)
The baseline verification every customer receives: identity, the nature of the relationship, and screening against watchlists. Higher-risk customers get enhanced due diligence.
Customer identification program (CIP)
The federal requirement — often just called KYC — that a financial institution verify the identity of every customer before opening an account: name, date of birth, address, and identification number.
D
Data minimization
Sharing a verified conclusion rather than the underlying document.
De-peg
When a stablecoin trades away from the value it targets (for example, a dollar-pegged token moving off $1), usually a sign of reserve or confidence problems.
Defined benefit plan
A plan that promises a specified retirement benefit, with the employer bearing investment risk.
Defined contribution plan
A plan where contributions are defined and the ending benefit depends on investment results.
Designated Roth account
The Roth sub-account within an employer plan, funded with after-tax salary deferrals.
Digital asset
A cryptographic asset such as a cryptocurrency or token; availability and custody depend on the platform and rules.
Digital dollar
An informal term for a dollar-pegged stablecoin — a token that holds and moves the value of a U.S. dollar on a blockchain.
Disqualified person
A person or entity whose dealings with a retirement account can create a prohibited transaction — including the owner and certain family and controlled entities.
Distribution
A withdrawal from an account; tax treatment depends on the account type and circumstances.
Distribution waterfall
The order in which fund cash flows are paid to investors and the general partner.
Diversification
Spreading investments across assets to reduce the impact of any single one on the whole portfolio.
Due diligence
The investigation an investor performs before committing capital — and, separately, the verification a custodian performs before accepting an asset. Neither substitutes for the other.
E
Elective deferral
The portion of salary an employee chooses to contribute to a retirement plan.
Eligible designated beneficiary
A beneficiary category (such as a spouse or certain others) with distribution options that differ from the general 10-year rule.
Employer match
Employer contributions made in proportion to an employee’s deferrals.
Enhanced due diligence (EDD)
Deeper scrutiny applied to higher-risk customers — source-of-funds review, closer monitoring, and screening of associates. Politically exposed persons are a classic trigger.
Escheatment
The transfer of unclaimed property to the state after dormancy periods — the eventual fate of forgotten accounts nobody claims.
Evergreen fund
An open-ended private fund with no fixed termination date, usually funded in full at entry rather than through capital calls, offering periodic repurchases subject to caps. Simpler for an account to administer than a drawdown fund.
Evidence artifact
A document or authoritative record supporting a claim — an ID, trust agreement, formation document, or bank verification.
Excess contribution
A contribution above the allowed limit, which can incur an excise tax until corrected.
Excise tax
A penalty tax, such as the tax on a missed RMD or an excess contribution.
Expense ratio
The annual cost of a fund, expressed as a percentage of assets.
F
Fair market valuation
A periodic estimate of an asset’s current value, required for reporting on hard-to-value holdings.
FATCA
The Foreign Account Tax Compliance Act, which drives the W-9 / W-8 tax classification captured in your profile.
FBO (for the benefit of)
The titling format that keeps account-owned assets legally the account’s — e.g., custodian FBO owner’s IRA. Why it matters.
FDIC insurance
Federal deposit insurance that covers qualifying bank deposits up to set limits; investments, and stablecoins, are not FDIC-insured.
Fiat-backed stablecoin
A stablecoin fully backed by reserves of cash and cash-equivalents — such as short-term U.S. Treasuries — held by the issuer; the mainstream, regulated model.
Fiduciary
A party that has accepted a duty to act in another’s interest; status depends on function and authority, not title alone.
FinCEN
The Financial Crimes Enforcement Network — the U.S. Treasury bureau that enforces the Bank Secrecy Act, collects SARs and CTRs, and safeguards the financial system against illicit use.
Five-year rule
A Roth timing rule; separate five-year periods determine tax-free earnings and penalty-free access to converted amounts.
Flexible spending account (FSA)
A pre-tax employer account for eligible health or dependent-care expenses, generally use-it-or-lose-it on the plan year.
Form 1099-R
The IRS form reporting distributions from retirement accounts — cash or in-kind, it documents what left and why.
Form 5498
The IRS form on which custodians report IRA contributions and year-end fair market value — where your private assets’ annual valuations end up.
G
General partner (GP)
The managing partner of a fund or partnership, responsible for operations and decisions.
GENIUS Act
2025 U.S. federal law establishing a framework for payment stablecoins, requiring full reserve backing, regular disclosures, redemption rights, and issuer oversight.
Grace period (FSA)
An optional plan feature extending the deadline to incur FSA-eligible expenses briefly into the new year — one of the softenings of use-it-or-lose-it.
H
Health reimbursement arrangement (HRA)
An employer-funded arrangement reimbursing qualified medical expenses; employer money, employer rules.
Health savings account (HSA)
A triple-tax-advantaged account for medical costs, available with qualifying high-deductible coverage; portable for life and investable. The account.
High-deductible health plan (HDHP)
A health plan meeting statutory deductible and out-of-pocket rules — the coverage that unlocks HSA contributions.
I
Illiquidity
The difficulty of converting an asset to cash quickly without loss of value.
Illiquidity premium
The additional return an investor may require for giving up the ability to sell on demand. An expectation rather than an entitlement, and the reason long-duration assets are often paired with long-duration retirement money.
Immutable audit log
A tamper-evident record of who accessed what and when, used for compliance and reporting.
In-kind distribution
Distributing an asset itself — a fractional deed, shares of a fund — rather than cash; valued at fair market value on the date and taxed like cash.
In-kind transfer
Moving an asset between accounts without selling it, so the investment itself changes custodians.
Infrastructure
Private-market exposure to the physical systems an economy runs on — power, midstream energy, water, transport, data centres, fibre, towers. Long duration and typically leveraged at the asset level, so it is a frequent source of UDFI. See infrastructure.
Inherited IRA
A retirement account received as a beneficiary, operating under distribution rules — and deadlines — different from the owner’s. When it holds illiquid assets.
Interval fund
A registered closed-end fund that commits in its charter to repurchase a stated percentage of shares at set intervals, commonly 5% per quarter. The commitment is real and it is capped: oversubscribed requests are pro-rated.
Investor Passport
A reusable, investor-controlled profile of verified identity, entity, ownership, tax, banking, and authority information — used to open and administer accounts without starting over. Learn more.
IRA aggregation
The rule letting you total RMDs across your IRAs and take the sum from whichever has the cash — a liquid account can carry an illiquid one’s obligation.
K
Know your business (KYB)
The entity equivalent of KYC: verifying a company, trust, or fund’s formation, good standing, and ownership.
Know your customer (KYC)
The identity-verification and risk-assessment process a custodian must complete before opening an account.
Know your transactions (KYT)
The third leg of the verification triad after KYC and KYB: ongoing monitoring of transactions — amount, frequency, timing, counterparties — to flag patterns that suggest financial crime rather than ordinary activity.
L
Limited partner (LP)
A passive investor in a partnership whose liability is generally limited to the amount invested.
Limited-purpose FSA
An FSA restricted to dental and vision so it can pair with an HSA without breaking eligibility. The pairing.
Liquidity
How easily an asset can be converted to cash without moving its price.
M
Modified adjusted gross income (MAGI)
Adjusted gross income with certain items added back; used to determine eligibility for many tax benefits and phase-outs.
Money market fund
A fund that invests in short-term, high-quality debt and aims to preserve a stable value while earning yield.
N
Net asset value (NAV)
A fund’s assets minus liabilities, usually per unit — the number periodic fund reporting and custodial valuations revolve around.
Never Trust architecture
An approach that authorizes each request against the specific record it touches and refuses by default.
Non-recourse loan
A loan secured only by the pledged asset, with no personal guarantee; generally required for leverage inside an IRA.
Non-traded fund
A registered fund that does not list on an exchange, so liquidity comes only from the fund’s own repurchase programme, which may be capped, pro-rated, or suspended.
Nondeductible contribution
A traditional IRA contribution for which no deduction is taken, creating basis tracked on Form 8606.
O
OFAC
The Office of Foreign Assets Control — the U.S. Treasury office that administers sanctions. Financial institutions screen customers and counterparties against OFAC lists before and during the relationship.
On-chain settlement
Completing a transaction directly on a blockchain — often near-instant and available around the clock, including weekends.
Open rails
Standardised, documented, interoperable financial infrastructure other applications can connect to without a custom integration. Open describes the interface, not eligibility — account and securities restrictions still apply to every record.
P
Peg
The fixed value a stablecoin is designed to hold, most often one U.S. dollar per token.
Per-record authorization
Checking each request against the specific record it tries to access, and refusing it by default.
Perpetual KYC (pKYC)
Re-verification driven by events — a sanctions-list update, a change of ownership, an unusual transaction — instead of a fixed calendar review. The identity-side analogue of continuous authorization.
Plan administrator
The party responsible for specified administrative functions of a retirement plan.
Plan sponsor
The employer or entity that establishes and maintains a retirement plan.
Politically exposed person (PEP)
A person in a prominent public role who warrants extra scrutiny under anti-money-laundering rules.
Post-quantum cryptography
Cryptographic methods designed to remain secure against future quantum computers.
Power of attorney
A legal authorization for one person to act for another. Recorded in the profile and enforced per record.
Precious metals
Certain gold, silver, platinum, and palladium products meeting purity and custody rules can be held in an IRA.
Preferred return
A minimum return paid to investors before the general partner shares in profits.
Private credit
Lending to companies outside public bond markets, often through funds.
Private equity
Ownership in companies that are not publicly traded, typically illiquid and long-horizon.
Private key
The secret cryptographic key that controls a digital-asset holding; whoever holds it controls the asset.
Pro-rata rule
A rule that prorates the taxable portion of an IRA distribution or conversion across all your traditional IRA balances, pre-tax and after-tax.
Profit-sharing contribution
A discretionary employer contribution not tied to employee deferrals.
Prohibited transaction
Improper dealing between a retirement account and a disqualified person, which can disqualify the account.
Promissory note
A written promise to repay a loan on set terms; can be held as an investment.
Q
Qualified charitable distribution (QCD)
A direct IRA-to-charity transfer that can satisfy an RMD without adding to taxable income, available from age 70 and a half.
Qualified custody
Holding digital assets with a regulated custodian, in the account’s name, rather than in a personal wallet.
Qualified distribution
A withdrawal that meets the conditions for favorable tax treatment (for example, a qualified Roth distribution).
Qualified intermediary
The independent party that holds proceeds between the sale and purchase legs of a 1031 exchange — touch the money yourself and the deferral dies.
Qualified purchaser
An investor meeting high asset thresholds, eligible for certain private offerings beyond accredited status.
Qualifying life event
A defined change — marriage, birth, job loss, and kin — that unlocks otherwise-locked benefits elections mid-year. What counts.
R
Real estate IRA
A self-directed IRA that holds real property; all income and expenses must flow through the IRA.
Recharacterization
Treating a contribution to one type of IRA as if made to the other; note that conversions can no longer be recharacterized.
Recordkeeper
A party that maintains participant accounts, balances, and transaction data for a plan.
Redemption
Exchanging a stablecoin back to fiat currency with its issuer, at the pegged value.
Regulation D
SEC rules permitting private securities offerings without full public registration.
Reliance letter
A signed statement from a qualified reviewer confirming an investor’s status, which a recipient can rely on.
Reliance package
A point-in-time bundle of credentials, evidence, and approvals showing exactly what was verified and when.
Required beginning date
The deadline for taking your first required minimum distribution.
Required minimum distribution (RMD)
The minimum amount that must be withdrawn from certain retirement accounts beginning at the applicable age.
Reserves (stablecoin)
The cash and cash-equivalent assets an issuer holds to back every stablecoin in circulation and honor redemptions.
Rollover
Moving retirement funds from one account to another; a direct rollover avoids withholding, while an indirect rollover has stricter rules.
Rollover IRA
A traditional IRA that holds funds rolled over from an employer plan.
Roth conversion
Moving pre-tax funds into a Roth account, creating taxable income in the year of conversion.
Roth IRA
An individual retirement account funded with after-tax dollars; qualified withdrawals, including earnings, can be tax-free.
S
Sanctions screening
Checking a party against government sanctions lists. A clear result is time-stamped and re-run over the relationship, not permanent.
Schedule K-1
A tax form reporting a partner’s share of a partnership’s income, deductions, and credits.
SECURE 2.0 Act
2022 legislation that changed RMD ages, catch-up rules, and many retirement-plan provisions, phased in over several years.
See-through trust
A trust transparent enough under tax rules to be treated as its human beneficiaries for inherited-IRA distribution purposes; drafting for it is specialist work.
Selective disclosure
Releasing only the specific fields a recipient needs, rather than an entire profile.
Self-dealing
Using a retirement account for the owner’s present-day benefit, a category of prohibited transaction.
Self-directed IRA
A custody and investment model that lets an IRA hold a broader range of assets; it is not a separate tax type.
SEP IRA
A simplified employer-funded retirement plan for businesses and the self-employed.
Settlement
The completion of a transaction, when cash and ownership actually change hands.
SIMPLE IRA
A small-employer plan allowing employee salary deferrals plus employer contributions.
Smart contract
Self-executing code on a blockchain that runs automatically when its conditions are met — used for conditional payouts, escrow, and automated workflows.
Solo 401(k)
A one-participant 401(k) for an owner-only business, allowing both employee and employer contributions.
Source of funds
Where the money for a transaction originates. Documenting it is part of anti-money-laundering review.
Sponsor
The party organizing and managing an investment offering — the fund manager, syndicator, or operator whose competence and honesty are the real asset. How to vet one.
Spousal IRA
An IRA funded for a lower- or non-earning spouse based on the couple’s joint earned income.
Stablecoin
A blockchain token designed to hold a steady value by tracking a reference asset — most often the U.S. dollar, one token to one dollar.
Subscription agreement
The contract by which an investor commits to purchase an interest in a fund or offering.
Successor custodian
A custodian that takes over administration if the prior custodian resigns or is replaced.
Suspicious activity report (SAR)
A confidential report a financial institution files with FinCEN when it detects potentially suspicious transactions. The customer is never told a SAR was filed.
Sweat equity
Value contributed through personal labor — which, applied to an asset your IRA owns, is a contribution the rules don’t permit.
T
Ten-year rule
The requirement that most non-spouse beneficiaries empty an inherited retirement account within ten years of the owner’s death.
Tender-offer fund
A fund whose board may run periodic repurchase tenders but is not required to, unlike an interval fund. Liquidity is discretionary, which matters when an account has a required distribution to pay.
Third-party administrator (TPA)
A provider of plan services such as design, compliance testing, and filings, distinct from a recordkeeper.
Titling
How an account or asset is legally named, which affects ownership and control.
Tokenization
Replacing sensitive data with a non-sensitive placeholder, revealed only on an authorized grant.
Traditional IRA
A tax-deferred individual retirement account; contributions may be deductible and withdrawals are generally taxed as ordinary income.
Transaction monitoring
Automated review of money movement against expected behavior — the operational machinery behind KYT and AML programs, and the source of most SAR filings.
Transfer
Moving assets between like accounts without a taxable distribution.
Triple tax advantage
The HSA’s signature: deductible contributions, tax-free growth, and tax-free qualified withdrawals — all three, in one account.
Trustee
A party that holds legal title and administers assets under a trust or plan; distinct from a custodian unless it performs both roles.
U
UBIT
Unrelated business income tax — tax a retirement account may owe on certain business income.
UDFI
Unrelated debt-financed income — income from debt-financed property that can create tax inside a retirement account.
Ultimate beneficial owner (UBO)
The individual who ultimately owns or controls a legal entity — generally 25% or more ownership. Identifying UBOs is the heart of KYB and the reason shell companies cannot hide their principals from a custodian.
V
Verified credential
A signed assertion issued after a defined verification process — distinct from self-declared data or the documents behind it.
Vesting
The process by which a participant earns a non-forfeitable right to employer contributions.
Vintage year
The year a fund makes its first investment or holds its final close. Returns are only meaningfully compared within a vintage, because entry pricing and the cycle drive much of the result.
Volatility
The degree to which an asset’s price fluctuates over time; higher volatility means larger swings.
W
W-8 (series)
IRS forms (W-8BEN, W-8BEN-E, and others) used by non-U.S. persons to certify tax status. Generally valid through the third year after signing unless circumstances change.
W-9
The IRS form used by U.S. persons to certify their taxpayer identification number and tax status.
Wallet
Software or hardware that stores the cryptographic keys used to access digital assets.
Y
Yield
The income an investment produces, expressed as a percentage of its price or value.
Z
Zero trust
A security model that never assumes trust and verifies every request; identity-centric access control.