Cash Liquidation Distribution


DEFINITION of 'Cash Liquidation Distribution'

The amount of capital that is returned to the investor or business owner when a business is liquidated. Cash liquidation distributions are usually considered a nontaxable return of principal. Credit unions send this sort of distribution to their depositors when they are liquidated as well.

BREAKING DOWN 'Cash Liquidation Distribution'

Proceeds from cash liquidation distributions are reported on Form 1099-DIV. However, only the amount of distribution that is in excess of the recipient's original investment is taxable. The gain is then reported on schedule D.

  1. Cash

    Legal tender or coins that can be used to exchange goods, debt ...
  2. Liquidation Value

    The total worth of a company's physical assets when it goes out ...
  3. Cash Concentration And Disbursement ...

    A type of electronic payment used to transfer funds between remote ...
  4. Distribution

    1. When trading volume is higher than that of the previous day ...
  5. Liquidation

    1. When a business or firm is terminated or bankrupt, its assets ...
  6. Liquidity

    The degree to which an asset or security can be quickly bought ...
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