after-tax income

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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 ?
The probability of food insecurity was halved from one end of the observed after-tax income distribution to the other.
after-tax income of a credit union that qualified for the small business deduction; and
Analysis of Variance (ANOVA) was used to determine differences in total effective tax rates, share of after-tax income, and amount of after-tax income by presidential term (Reagan, G.
In a longer time perspective young singles had the slowest rise in household income with an average after-tax income of NOK166,200 in 2001, an increase of 14% as compared to the year 1990.
20) The progressivity of the current income tax makes the distribution of after-tax income somewhat less unequal than the distribution of pretax income.
9 million in after-tax income from Longs' wholly owned RxAmerica pharmacy benefits management company (PBM), versus $600,000 in the fiscal 2001 period, when the PBM was a joint venture of Longs and Albertson's Inc.
Bureau of Labor Statistics, they found the average household real after-tax income of married single earner households fell $1,600 (1986 dollars) between 1973 and 1986, while the same measure rose $800 for married dual earner households (Rubin and Riney 1995, 102-103).
Before their August recess, Congress approved a tax bill that gives most of the tax cuts to the households at the top whose after-tax income already has risen sharply.
For instance, before the 1986 Tax Reform Act, many high-income parents shifted some of their income to their children to maximize the family's after-tax income.
This represents about 5 percent of that individual's after-tax income.
Reaves Utility Income Fund is a diversified closed-end management investment company that aims to provide an after-tax income and total return consisting primarily of tax-advantaged dividend income and capital appreciation.