What does personal holding company income mean on the CPA exam?
Personal holding company income. Mostly passive income -- dividends, interest, rents, royalties -- which, with concentrated ownership, triggers a penalty tax on undistributed amounts.
Defined against Sec. 543.
Which CPA exam sections use personal holding company income?
Personal holding company income appears in the TCP section of the CPA exam.
Related terms
- net investment income: Interest, dividends, capital gains, rents, royalties and income from passive businesses, less the deductions allocable to them.
- passive income: Income from an activity the taxpayer does not materially participate in, plus most rental income.
- ordinary income: Income taxed at the regular graduated rates rather than at preferential capital gain rates.
- operating income: Profit from the core business, before interest and tax.
- earned income: Compensation for personal services -- wages, or net earnings from self-employment.
- gross income: All income from whatever source derived, unless the Code specifically excludes it.