An income tax shall be levied and collected annually on incomes derived by way of dividends from stocks or by way of interest on bonds of each person, partnership, association, trust and corporation in this state who received, or to whom accrued, or to whom was credited during any year income from the sources enumerated in this section, except as otherwise provided in this chapter. The rate of the tax imposed by this chapter shall be:

(1) For any tax year that begins on or after January 1, 2017, and prior to January 1, 2018, four percent (4%);

Terms Used In Tennessee Code 67-2-102

  • Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
  • Partnership: A voluntary contract between two or more persons to pool some or all of their assets into a business, with the agreement that there will be a proportional sharing of profits and losses.
  • Person: includes a corporation, firm, company or association. See Tennessee Code 1-3-105
  • State: when applied to the different parts of the United States, includes the District of Columbia and the several territories of the United States. See Tennessee Code 1-3-105
  • Stocks: means shares of stock issued by corporations chartered and organized under the laws of the state of Tennessee, or of any other state, or of the United States, or of any foreign government, and all interests in partnerships, associations, or trusts represented by transferable evidence of such interest. See Tennessee Code 67-2-101
  • Year: means a calendar year, unless otherwise expressed. See Tennessee Code 1-3-105
(2) For any tax year that begins on or after January 1, 2018, and prior to January 1, 2019, three percent (3%);
(3) For any tax year that begins on or after January 1, 2019, and prior to January 1, 2020, two percent (2%);
(4) For any tax year that begins on or after January 1, 2020, and prior to January 1, 2021, one percent (1%); and
(5) For any tax year that begins on or after January 1, 2021, and for subsequent tax years, zero percent (0%).
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