Dividend income is the income from dividend. A dividend is paid by a company to its shareholders. Dividend income can be incurred in many forms.
The common forms of dividend income are as follows:
Cash � Cash dividend income is received through checks. This investment income is liable to be taxed and this is the most common form of dividend income
Property � This income is in the form of assets received from the issuing company or its subsidiary company. Various products and services offered by companies to their shareholders also come under this category
Stock � This is the income accrued through the additional stock shares provided by the companies to their shareholders. The amount of shares owned by the shareholders in a particular company settles the amount of income of the shareholders in the form of stocks
The income from dividend accruing to the owner is the amount that is obtained from calculating the amount of money that is received from each individual share. The higher growth companies are not exactly the right place to receive dividend income because they rarely offer dividends to their shareholders. A dividend income is also the income generated from the capital gains of investors in mutual funds. The shareholders get dividend income from the mutual funds. These capital gains are distributed at the end of each year.
Income from dividend results from the distribution of company assets among its shareholders. No dividend income gets generated if the company re-invests the profits into its business. The income that is obtained from dividend reaches the shareholder directly and this income is not dependent on the rise of stock price. Dividend income is received from companies that achieve high profit levels because this makes a lot of cash available at their disposal.
The following are the companies from which high dividend income can be made:
Bristol Myers Squibb
Bank of America