loophole

noun
loop·​hole | \ ˈlüp-ˌhōl How to pronounce loophole (audio) \

Definition of loophole

 (Entry 1 of 2)

1a : a small opening through which small arms may be fired
b : a similar opening to admit light and air or to permit observation
2 : a means of escape especially : an ambiguity or omission in the text through which the intent of a statute, contract, or obligation may be evaded

loophole

verb
loopholed; loopholing; loopholes

Definition of loophole (Entry 2 of 2)

transitive verb

: to make loopholes in

Examples of loophole in a Sentence

Noun

She took advantage of a loophole in the tax law. His attorney has been hunting for a loophole that would allow him to get out of the deal. tried to close a loophole in the new legislation
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Recent Examples on the Web: Noun

There are so many loopholes in gun laws that don’t protect women. Jennifer Wright, Harper's BAZAAR, "Why Gun Violence Is a Women's Issue," 27 Mar. 2019 There's a loophole in the 1994 Brady Bill that exempts places like gun shows and the internet from having to conduct background checks. Rachel Epstein, Marie Claire, "How to Get the H.R. 8 Universal Background Checks Bill Passed in the Senate," 28 Feb. 2019 Section 232 is basically a trade loophole that Trump has used to impose steel and aluminum tariffs on Canada, Mexico, and the European Union. Jen Kirby, Vox, "The three countries signed the deal at the G20 on Friday.," 30 Nov. 2018 But there is a potential loophole amidst these limits, Ossorio told Ars. John Timmer, Ars Technica, "Scientists, ethicists slam decisions behind gene-edited twins," 30 Nov. 2018 And maybe this is a tax loophole that is being exploited. Theodore Schleifer, Recode, "The new hotness for tech billionaires? Do-gooder investments they can write off on their taxes.," 16 Oct. 2018 There are loopholes in all of this, but there’s an unassailable consensus that these rules are far better than the alternative. Franklin Foer, The Atlantic, "It’s Time to Regulate the Internet," 21 Mar. 2018 A few classmates said there should not be a ban on assault weapons and argued that there are too many loopholes for gun buyers to avoid scrutiny, Kaufman said. Linda Trischitta, Sun-Sentinel.com, "After Parkland shooting, kids tell of anger, loss and hope," 1 Mar. 2018 The bill still closes a loophole created by the state’s 2015 medical marijuana law that allows patients to possess the drug but provides them no legal avenue to obtain it. Sanya Mansoor, The Seattle Times, "Medical marijuana oil bill clears Georgia Senate," 29 Mar. 2019

These example sentences are selected automatically from various online news sources to reflect current usage of the word 'loophole.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.

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First Known Use of loophole

Noun

1591, in the meaning defined at sense 1a

Verb

1664, in the meaning defined above

History and Etymology for loophole

Noun

loop entry 1

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Dictionary Entries near loophole

looped

looper

loop hinge

loophole

loop in

looping snail

loop jump

Statistics for loophole

Last Updated

23 May 2019

Look-up Popularity

Time Traveler for loophole

The first known use of loophole was in 1591

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More Definitions for loophole

loophole

noun

Financial Definition of loophole

What It Is

A loophole is an exception that allows a system to be circumvented or avoided.  It usually refers to legal, taxation, or security strategies that are exploited for personal gain.

How It Works

Loopholes are failures of a system to account for all conditions, variables, or exceptions.   To illustrate a legal loophole, consider a local development law that requires even an unoccupied building to pay real estate taxes so long as it receives a certificate of completion.  In order to avoid paying taxes, a builder may exploit this loophole and choose not to "complete" the building.

An example of a tax loophole is the tax break for small businesses who invest in "heavy vehicles". The tax break applies if the vehicle is used at least 50% of the time for the business.   Business owners may exploit this loophole by upgrading their own vehicles to SUVs, which are considered "heavy" under the tax law, and thereby gain a personal financial advantage.

In most instances, loopholes that lead to excessive abuse are corrected by subsequent regulations and laws.

Why It Matters

While loopholes may save money or allow a purchase that would otherwise not be economical, the use of loopholes is considered questionable. Exploiting loopholes may lead to intensive scrutiny and audits, or even just a feeling of bad faith.  For example, a tax payer should be aware when a tax consultant advises of specific tax advantage of whether the advantage is claimed on the basis of an allowable deduction or a loophole.

Source: Investing Answers

loophole

noun

English Language Learners Definition of loophole

: an error in the way a law, rule, or contract is written that makes it possible for some people to legally avoid obeying it

loophole

noun
loop·​hole | \ ˈlüp-ˌhōl How to pronounce loophole (audio) \

Kids Definition of loophole

: a way of avoiding something a loophole in the law

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More from Merriam-Webster on loophole

Rhyming Dictionary: Words that rhyme with loophole

Spanish Central: Translation of loophole

Nglish: Translation of loophole for Spanish Speakers

Britannica English: Translation of loophole for Arabic Speakers

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