IPA: /ˈsɛtˌɔf/
KK: /ˈsɛtˌɔf/
A thing that balances or compensates for another; it can also refer to a projection from a wall or a decorative element that enhances contrast.
The tax setoff helped reduce the amount I owed this year.
Setoff is formed from "set" (from Old English *settan*, meaning to place or put) and "off" (meaning away or apart). The term refers to the act of placing something away or apart, often in a financial context where one debt is set against another.
Think of 'placing' something ('set') 'away' ('off') — that's why setoff means to offset or counterbalance debts.