Warning
Info
Warning
Info
Simple English definitions for legal terms
aggregate concept
Read a random definition: passing on
A quick definition of aggregate concept:
An aggregate concept is a way of taxing businesses where the organization is seen as a group of its owners, rather than a separate entity that is taxed on its own. This means that the owners are responsible for paying taxes on the profits they receive from the business, rather than the business itself being taxed.
A more thorough explanation:
Definition: Aggregate concept is an approach to taxing business organizations where the organization is seen as a group of its individual owners, rather than a separate taxable entity.
Example: Let's say there is a small business with three owners. Under the aggregate concept, each owner would report their share of the business's profits and losses on their personal tax returns. The business itself would not be taxed as a separate entity.
This approach is commonly used for partnerships and limited liability companies (LLCs) where the owners are also the managers of the business. It allows for a simpler tax structure and avoids double taxation.