ordinary income
Standard taxable pay
Ordinary income is earnings taxed at standard income tax rates rather than preferential rates.
It includes wages, salaries, tips, commissions, bonuses, and interest—essentially most income that isn't classified as capital gains or qualified dividends.
His ordinary income put him in the 24% bracket, but his stock profits were taxed at the lower capital gains rate.
The distinction matters primarily for tax planning.
- wagesPayment for work
- salaryFixed periodic employment payment
- taxableSubject to government levy
- tax bracketTaxable income category
- earningsMoney gained from work
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