ordinary income
- It refers to revenue that one generates from usual sources like remuneration, dividends, interest, or short-term profits from the sale of assets, and it does not include income made from selling capital assets or properties utilized in their profession
- A business's ordinary income will typically consist of its revenue from its main operations, minus any direct costs and expenses.
- John, an individual, earns ordinary income through his salary, interests from his savings, and dividends from his investments.
- Profits from the sale of newly developed software is considered as ordinary income for the software development company.
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