tax-deferred income


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Related to tax-deferred income: Tax deferral

Tax-deferred income

Dividends, interest, and unrealized capital gains on investments in an account such as a qualified retirement plan, where income is not subject to taxation until a withdrawal is made.

Tax-Deferred Income

Any income that one earns but does not receive until a later date, resulting in a situation in which taxes on the income are not paid until later. Common examples of tax-deferred income fall into two broad categories. The first is income in certain retirement accounts; the account holder is not liable for taxes until funds are disbursed. The second is the capital gain on some bonds such as U.S. Treasury securities; taxes on these gains are deferred until maturity. It is important to note that tax-deferred income is not the same as tax-free income, which has no tax liability at all.

tax-deferred income

The income that is earned but that is neither received nor taxed until a later date. For example, interest earned on U.S. Treasury bills is received and taxed at maturity. Likewise, U.S. savings bonds provide appreciation of value on which holders may defer paying taxes until the security is cashed in. Compare tax-free income, tax-sheltered income.
References in periodicals archive ?
Regardless of what income-tax bracket, tax-deferred income is almost always considered better than taxable.
Current-Year Tax-Deferred Income.--This amount represented the IC-DISC's taxable income after all current year taxable income amounts deemed distributed under Internal Revenue Code section 995(b)(1) were subtracted.
Producer's Loans.--This qualified asset generally consisted of loans made from the IC-DISC's accumulated tax-deferred income to its parent company or any other U.S.
where: ar = The accumulation rate after tax on the currently taxable component of return (usually ordinary income), but before tax on the accumulating and tax-deferred capital gains or tax-deferred income component of return
g = The proportion of total before-tax return, r, attributable to tax-deferred capital gain (or tax-deferred income)
This allowed the daughter to receive the benefits of continuous, tax-deferred income growth by "stretching" distributions over her life expectancy.
He's paying too much in taxes and missing opportunities for tax-deferred income by failing to set up a retirement plan.
To Permit Petitioner to increase basis in the stock of the corporation on account of such tax-deferred income would produce a windfall to him.
1366(a)(1)(A) and 1367 and increases their stock bases, or is some other type of tax-deferred income that does not increase basis.
Individual retirement accounts (IRAs) are, by design, supposed to be simple, uncomplicated vehicles by which to make tax-deferred contributions (and obtain tax-deferred income growth) into a retirement nest egg.
108 income, the cancellation of indebtedness income excluded at the shareholder level passes through to the shareholders as tax-deferred income, through an asset basis adjustment or offset of a tax attribute, not as tax-exempt increase their stock basis under Sec.
They provide a tax deduction for contributions, tax-deferred income and often, tax-favored payouts.