material participation

material participation definition - business

material participation

An IRS classification for working in a business on a regular, continuous, and substantial basis. Without material participation, a taxpayer is considered an investor, and losses are considered passive and generally not deductible except against passive income.

The American Heritage® Dictionary of Business Terms Copyright © 2009 by Houghton Mifflin Harcourt Publishing Company. Published by Houghton Mifflin Harcourt Publishing Company. All rights reserved.

Comments
Improve this definition.
Do you have more to add? Share your linguistic knowledge or observation.
/Register to save your comments.