Earnings and Profits

Earnings and Profits

Earnings and Profits means:
a term referring to the economic capacity of a corporation to make a distribution to shareholders that is not a return of capital. Such a distribution would constitute a taxable dividend to the shareholder to the extent of current and accumulated earnings and profit. The concept is similar to retained earnings; however, although the calculation of earnings and profits starts with taxable income, the amount in the account more closely resembles the economist's approach to income (i.e., inflow and outflow of wealth). Former IRC (check if this IRC provision is current here) §312.

See also other Tax Terms and Definitions in U.S.A.

current earnings and profits.

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





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