The above terms have specific meaning in specific contexts. It may even be compensation in the ordinary meaning of the term, but given the meaning in legal contexts, I would shy away from that term.

We really need more context here.


http://www.investopedia.com/terms/s/set-off-clause.asp#axzz2...

Definition of 'Set-Off Clause'
A legal clause that gives a lender the authority to seize a debtor's deposits when they default on a loan. A set-off clause can also refer to a settlement of mutual debt between a creditor and a debtor through offsetting transaction claims. This allows creditors to collect a greater amount than they usually could under bankruptcy proceedings.

Investopedia explains 'Set-Off Clause'
If a debtor is unable to meet an obligation to his or her bank, the bank can seize the customer's current deposit. Set-off provisions are not limited to loans between banks and their customers, but are also widely used in other industries, such as construction.

The Truth in Lending Act prohibits set-off clauses from applying to credit card transactions; this protects consumers who decline to pay for defective merchandise.


Read more: http://www.investopedia.com/terms/s/set-off-clause.asp#ixzz2...


http://financial-dictionary.thefreedictionary.com/Setoff

Setoff
Money held on behalf of a borrower that may be applied to repay the loan, but usually without the permission of the borrower.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.
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Setoff
1. The ability of a debtor to reduce the amount of one's debt by an amount the creditor owes to the debtor. Thus, if a debtor owes a creditor $20,000 but the creditor owes the debtor $5,000 in an unrelated matter, setoff allows the debtor effectively to owe only $15,000.

2. In banking, the right of a bank to seize a debtor's account balance held at that bank if a debt is in or near default. Some jurisdictions limit the right of setoff; for example, the United States does not allow it to apply for commercial loans or credit card debt.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved


http://www.investopedia.com/terms/o/offset.asp#axzz2MZDZabKt

Definition of 'Offset'
1. To liquidate a futures position by entering an equivalent, but opposite, transaction which eliminates the delivery obligation.

2. To reduce an investor's net position in an investment to zero, so that no further gains or losses will be experienced from that position.

Investopedia explains 'Offset'
1. Investors will offset futures contracts and other investment positions in order to remove themselves from any associated liabilities. Almost all futures positions are offset before the terms of the futures contract are realized. Despite the fact that most positions are offset near the delivery term, the benefits of the futures contract as a hedging mechanism are still realized.

2. If the initial investment was a purchase, a sale is made to neutralize the position; to offset an initial sale, a purchase is made to neutralize the position. For example, if you wanted to offset a long position in a stock, you could short sell an identical number of shares. By doing so, your net ownership of the stock would be zero, and you would not incur any further gains or losses from the position

Read more: http://www.investopedia.com/terms/o/offset.asp#ixzz2MZF9CrtC

http://financial-dictionary.thefreedictionary.com/Offset

Offset
Elimination of a long or short position by making an opposite transaction. Related: Liquidation.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

ffset
To change from a long position to ashort position or from a short position to a long position. A long position is ownership of a security, while a short position is debt. Thus, to offset a long position is to sell a security, and to close a short position is to buy out the debt.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

ffset. You offset an options or futures position by taking a second position in a contract with identical terms, buying if you sold initially or selling if you bought initially.

With the offset, you neutralize any potential obligation you had to fulfill the terms of the contract, and you may make a profit or reduce a loss with the transaction.

For example, if you'd sold an equity call option that is close to being in-the-money, you might buy an offsetting call option. That neutralizes your obligation to deliver the underlying stock if the option you sold is exercised.

In a tax context, you can use capital losses to offset an equivalent dollar amount of capital gains, or up to $3,000 in capital losses to offset ordinary income. In either case, the offset allows you to reduce the tax you owe.

Further, banks have the right of offset if a borrower defaults on a loan. That right allows a bank to seize assets in the borrower's deposit accounts with the bank to reduce or eliminate any loss on the loan.

Dictionary of Financial Terms. Copyright © 2008 Lightbulb Press, Inc. All Rights Reserved.