DEFINITION of 'Year'

A period of time that is comprised of 12 consecutive months. A year is a 12-month period whose start date can vary. For individual taxation purposes (for annual federal income tax returns, for example), "year" typically refers to the calendar year that begins on January 1 and ends on December 31. A fiscal year is a period that is used for corporate or government accounting purposes and the preparing of financial statements. A fiscal year might coincide with the calendar year, or the time period that it represents could begin and end on different dates (as long as it involves 12 consecutive months).

BREAKING DOWN 'Year'

Corporations can elect to use the calendar year as their fiscal year (i.e., January 1 - December 31); however, they may choose any period to use for reporting and accounting purposes. By default, the IRS considers taxpayers to be calendar-year taxpayers; fiscal-year taxpayers (with other than January 1 - December 31 years) may have different deadlines for payments and for the filing of certain forms. The U.S. government's fiscal year, for example, begins on October 1 and ends on September 30. If a fiscal year ends during the next calendar year, it is referred to as the year in which it ends. For example, if the fiscal year runs from June 1, 2012, to May 31, 2013, it would be designated "fiscal year 2013" or "FY2013."

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