ordinary income

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.

Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.

ordinary income

Income subject to full or ordinary taxation rates. Contrast with capital gains.

References in periodicals archive ?

Also, the Fairholme Focused Income Fund (NASDAQ:FOCIX) distributed a dividend of USD0.15528 per share on its ordinary income dividend, distribution of USD0.00299 per share that is a short-term capital gain and a long-term capital gain distribution of USD0.04287 per share, which totalled USD0.20114 per share.

Three Fairholme Funds announces dividends and distributions for December 2016

The amount of gain between the grant price of the option to the actual selling market price of the stock at exercise, is the amount reported as ordinary income on an employee's W-2, boxes 1,3, 5 as wages, with box 12, code V, denoting the specific stock option amount.

How to Avoid Your Client's Highest Risk for Double Taxation

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.

Right to purchase land is a capital asset: a taxpayer's sale of his position in a lawsuit resulted in capital gain rather than ordinary income

In Tax Court, the IRS argued that Long received the $5.75 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.

Assignment of rights in lawsuit results in capital gain

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.

Pure carried interest on brink of extinction

Ordinary income is now expected to land at JPY19bn against a previous forecast of JPY15.5bn.

Dainippon Sumitomo's Apr-Sep 2011 net income rises 10.6% Y/Y

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Gain from the sale of an income interest in a trust

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.

House passes carried interest tax law; Senate prospects uncertain

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.

Ajinomoto Increases FY Guidance on Higher Sales of Umami and Nucleotides

You will be taxed on the original cost of the stock as if it were ordinary income ($17,500 tax in this example) and the remaining $450,000 would be considered taxable as a capital gain.

Roth IRA plus NUA equals danger

If the gain is all ordinary income, then the deduction equals basis; and if it is all long-term capital gain, then the deduction is the fair market value of the policy.

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Suzuki sets new record highs in consolidated financial results for fiscal year 2007 Net sales up for ninth consecutive year while operating income, ordinary income and net income likewise maintain year-on-year gains Suzuki Motors Corp.

Suzuki sets new record highs in consolidated financial results for fiscal year 2007