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LSDefine
Simple English definitions for legal terms
personal income
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A quick definition of personal income:
Personal income refers to the money or other forms of payment that a person receives from various sources such as employment, business, investments, gifts, and more. It is the total income received by an individual from all sources. Some types of personal income include wages, salary, dividends, interest, and capital gains. Taxable income is calculated by subtracting allowable deductions and exemptions from gross income.A more thorough explanation:
Personal income refers to the money or other forms of payment that an individual receives from various sources such as employment, business, investments, royalties, gifts, and more. It can be received periodically or as a lump sum.
Examples of personal income include:
- Wages or salary earned from a job
- Income earned from a business
- Interest earned from savings accounts or investments
- Dividends received from stocks
- Rental income from a property
- Gifts or inheritances received
These examples illustrate how personal income can come from various sources and can be earned or received in different ways. Personal income is important because it is used to pay for living expenses, save for the future, and invest in assets that can generate more income.