ordinary income


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Ordinary income

The income derived from the regular operating activities of a firm or individual.

Ordinary Income

In taxation, income from wages or salaries, interest, or commissions. Ordinary income is received in the short-term; for example, one usually receives a paycheck every two weeks or interest on a bond a few times per year. Ordinary income differs from capital gain, which is income from investment and is usually realized over a longer period of time. Most ordinary income is taxed at a higher rate than capital gain, so as to encourage long-term investment. In the United States, dividends were taxed as ordinary income, but this changed in 2003. One may think of ordinary income as income from one's job and/or standard business transactions.

ordinary income

Income that does not qualify for special tax treatment. Wages, dividends, and interest are ordinary income.

ordinary income

Income subject to full or ordinary taxation rates. Contrast with capital gains.
References in periodicals archive ?
FAIRX distributed an ordinary income dividend of USD0.
Long reported $1,896,824 of the $5,750,000 proceeds on his 2006 Schedule C as ordinary income and did not report the remainder.
75 million in lieu of future ordinary income payments and, therefore, that money should be counted as ordinary income under the "substitution for ordinary income doctrine.
Currently, the character of income at the partnership level flows through to the partner when tax time rolls around--ordinary income for the partnership is taxed as ordinary income for the partner, and a capital gain for the partnership is taxed as a capital gain for the partner.
The Bill would create a special rule that taxes a portion of the net income allocated to a partner in respect of an "investment services partnership interest" as ordinary income, regardless of the character of that income to the partnership.
The company's previous forecast had projected operating income, ordinary income and net income at 49 billion yen, 49 billion yen and 10 billion yen, respectively.
If the gain is part ordinary income and part capital gain, the deduction equals basis plus capital gain.
Since these proposals would require the entire gain or loss to be immediately recognized, each subsequent annuity payment would consist only of an excludible portion and a taxable ordinary income portion.
5) Nonetheless, Judge Fisher's opinion for the Ninth Circuit, which sets out a two-factor test for whether a gain is ordinary income under the "substitute for ordinary income" doctrine, is problematic.
Ordinary income would be increased by a 338(g) election (for the amount of gain), and thus would usually result in an increase in U.
6% differential, the 1993 Act contains several provisions intended to prevent the conversion of ordinary income into capital gain.
The proliferation of derivative financial products permits taxpayers to enter into hedges of streams of ordinary income.