Earned Income


DEFINITION of 'Earned Income'

Income derived from active participation in a trade or business, including wages, salary, tips, commissions and bonuses. This is the opposite of unearned income.

BREAKING DOWN 'Earned Income'

Earned income includes any income that a person or company receives for work they have done. If your boss gives you an advance on your next check, this would be considered unearned income because you haven't yet done anything to earn it.

  1. Passive Income

    Earnings an individual derives from a rental property, limited ...
  2. Suspended Loss

    A capital loss that cannot be realized in a given tax year due ...
  3. Unearned Income

    Any income that comes from investments and other sources unrelated ...
  4. Earned Income Credit - EIC

    A tax credit in the United States which benefits certain taxpayers ...
  5. Unearned Revenue

    When an individual or company receives money for a service or ...
  6. Active Income

    Income for which services have been performed. This includes ...
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