after-tax income


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Profit

A company's total revenue less its operating expenses, interest paid, depreciation, and taxes. For example, suppose a widget manufacturer earns $1,000,000 in total revenue. The widgets cost $200,000 to make and his administrative and payroll expenses total $250,000. He also must subtract $50,000 in depreciation on his widget manufacturing equipment and pay $200,000 in taxes. His net income is stated as: $1,000,000 - $200,000 - $250,000 - $50,000 - $200,000 = $300,000.

After-tax income.

After-tax income, sometimes called post-tax dollars, is the amount of income you have left after federal income taxes (plus state and local income taxes, if they apply) have been withheld.

If you contribute to a nondeductible individual retirement account (IRA), a Roth IRA, or a 529 college savings plan, purchase an annuity, or invest in a taxable account, you are using after-tax income.

In contrast, if you contribute money to an employer sponsored retirement plan or flexible spending account, you are investing pretax income.

after-tax income

Income after deducting taxes.After-tax income is not the same thing as after-tax cash flow.The major difference between the two will usually occur because depreciation is a deduction from income but not cash flow.You don't write a check for depreciation.The other major difference arises because you write a check for mortgage principal payments, which reduces cash flow, but you can't deduct it,so it does not reduce taxable income.

References in periodicals archive ?
after-tax income of a credit union that qualified for the small business deduction; and
To what extent did different lower income household types, for example those with children and those headed by seniors, contribute disproportionately more or less shares of the Federal tax burden and after-tax income than comparably structured upper income households under the Reagan, G.
This paper addresses a part of these issues by focusing on two questions: (1) Has the real consumption and real after-tax income of married single worker households fallen in recent decades, while the real consumption and real after-tax income of married dual worker households stabilized or risen?
7 million Americans with the highest incomes will have as much after-tax income as the 100 million Americans with the lowest incomes.
This represents about 5 percent of that individual's after-tax income.
0 million net income after-tax for the twelve months ended December 31, 2006, compared to $887,000 after-tax income for the same period 2005, a 12.
According to the Congressional Budget Office, between 1979 and 2007 the average after-tax income of the top 1 percent of the population nearly quadrupled, from $347,000 to more than $1.
0 After-tax income from continuing operations, excluding restructuring and other income and charges 91.
419 and 419A, an employer's deductible costs are limited to the "qualified direct cost" of the benefit(s) provided, a limited extra amount to fund incurred but unpaid claims, and a reserve for retiree benefits, reduced by any after-tax income the trust earned.
Female lone-parent families recorded one of the largest increases in after-tax income in 2001 with a boost of 4.
This may still be unpopular, however, since after-tax income is taxed again when distributed to shareholders as dividends.
The combination of a large personal income increase and a small spending gain meant Americans' personal savings rate - savings as a percentage of after-tax income - was 0.