Patronage Dividend

Patronage Dividend means:
a payment to a patron of a cooperative that is (1) based on the quantity or value of the business done with or for that patron, (2) made under an obligation of the cooperative to pay such amount, and (3) determined by reference to the net earnings of the cooperative from business done with or for its patrons. Patronage dividends are taxable except on property bought for personal and business use. Former IRC (check if this IRC provision is current here) § 1388(a).

See Dividend in the American Legal Encyclopedia and Dividend in the World Legal Encyclopedia.

Description and Definition of Patronage Dividend

Taxable distributions of a cooperative's profits to its members or patrons.

Resources

See Also

Further Reading

• Patronage Dividend in the West's Tax Law Dictionary
• Patronage Dividend in “A Dictionary of Taxation”