BACKUP WITHHOLDING Definition

Bookmark and Share

BACKUP WITHHOLDING is a mandatory withholding that may be imposed when rules regarding taxpayer identification numbers, (usually a Social Security number) are not met by the individual. Another way for these withholdings to take effect is when a notice is issued by the IRS to withhold on payments to that individual. Backup withholding may be claimed as a credit by taxpayers on their federal income tax return.

Learn new Accounting Terms

MARGINAL TAX RATE is the top rate of income tax that is charged to individuals on their earnings.

STOCK DIVIDEND is a dividend paid in stock rather than in cash. The additional shares can be in the form of a stock split, additional shares of the issuing company, or of a subsidiary.

Suggest a Term

Enter Search Term

Enter a term, then click the entry you would like to view.