unearned income

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Unearned Income

Any income that comes from investments and other sources unrelated to employment services.

Notes:

Examples of unearned income include interest from a savings account, bond interest, tips, alimony, and dividends from stock. As long as this income is "realized" then it is taxable.

See also: Earned Income, Passive Income

Unearned income (revenue)

Income received in advance of the time at which it is earned, such as prepaid rent.

unearned income

Individual income, such as dividends, pension payments, and capital gains, that is derived from something other than personal services. Compare earned income.

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