consent dividend

Consent Dividend

A dividend that is not actually paid to a shareholder but is kept as part of a company's retained earnings. A shareholder may agree to have a dividend added to his/her gross income even if it not paid. This may increase the shareholder's personal tax liability but may decrease the company's corporate tax liability, which may in turn help the share price.

consent dividend

The retained earnings that are credited to paid-in surplus by a personal holding company. The consent dividend is taxed to stockholders as an ordinary dividend; however, this tax liability is partially offset by the stockholders' increasing the cost basis of the stock by the same amount.
Mentioned in ?
References in periodicals archive ?
The second charge was a $1,229,000 reduction related to a Real Estate Investment Trust (REIT) consent dividend deduction available to California banks for the tax years 2001 and 2002.
The Company does not plan to record any benefits related to the REIT consent dividend going forward until the courts resolve this tax issue.
The second adjustment relates to the Bank REIT consent dividend and the state of California Voluntary Compliance Initiative (VCI) program announced in early 2004.
shareholders agree to a consent dividend election with respect to such earnings.
The IRS allowed a deemed consent dividend at the end of the third year and thereby eliminated the corporation's AE&P.
The consent dividend mechanism is a hypothetical distribution of a specified amount made by a corporation that has a reasonable basis to believe that it is subject to the AET.
The proposed regulations provide three ways to facilitate the distribution of E&P: (1) an AAA bypass election, (2) a PTI bypass election and (3) a deemed dividend election (25) This last election works like a consent dividend (Sec.
Form 973 - Corporation Claim for Deduction for Consent Dividends
Chapter 6 of the book addresses basis issues, and covers deemed dividends, the new investment adjustment regime, excess loss accounts, and consent dividends.
Form 973, Corporation Claim for Deduction for Consent Dividends.
This seems a harsh and unfair result, because E&P is not frozen as to distributions, redemptions, consent dividends, etc.
SCRA Section 223 would statutorily allow consent dividends, which are currently permitted only by Regs.