Distribution In Kind

AAA

DEFINITION of 'Distribution In Kind'

A payment made in the form of securities or other property, rather than in cash. A distribution in kind may be made in several different situations, including a stock dividend, inheritance or taking securities out of a tax-deferred account. It can also refer to the transferal of an asset to a beneficiary over the option of liquidating the position and transferring the cash.


Also referred to as a "distribution in specie."

INVESTOPEDIA EXPLAINS 'Distribution In Kind'

The most common form of a distribution in kind occurs when a company pays a dividend in stock, rather than in cash. A distribution in kind may also be employed for tax reasons. In certain situations, receiving appreciated property directly can result in a lower tax bill versus selling the property and receiving the value of the property in cash.

RELATED TERMS
  1. Manufactured Payment

    A payment made to pass through dividend and interest payments ...
  2. Payment-In-Kind - PIK

    1. The use of a good or service as payment instead of cash. 2. ...
  3. Stock Dividend

    A dividend payment made in the form of additional shares, rather ...
  4. In Specie

    A phrase describing the distribution of an asset in its present ...
  5. Accelerated Dividend

    Special dividends paid by a company ahead of an imminent change ...
  6. Sucker Yield

    When an investor has essentially risked all of his capital for ...
Related Articles
  1. Which is better a cash dividend or a ...
    Investing

    Which is better a cash dividend or a ...

  2. How Dividends Work For Investors
    Investing Basics

    How Dividends Work For Investors

  3. How Advisors Can Protect Inherited IRAs
    Investing Basics

    How Advisors Can Protect Inherited IRAs

  4. What's the difference between a financial ...
    Retirement

    What's the difference between a financial ...

Hot Definitions
  1. Gross Rate Of Return

    The total rate of return on an investment before the deduction of any fees or expenses. The gross rate of return is quoted ...
  2. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
  3. Leading Indicator

    A measurable economic factor that changes before the economy starts to follow a particular pattern or trend. Leading indicators ...
  4. Wage-Price Spiral

    A macroeconomic theory to explain the cause-and-effect relationship between rising wages and rising prices, or inflation. ...
  5. Accelerated Depreciation

    Any method of depreciation used for accounting or income tax purposes that allows greater deductions in the earlier years ...
  6. Call Risk

    The risk, faced by a holder of a callable bond, that a bond issuer will take advantage of the callable bond feature and redeem ...
Trading Center