Nolo's Plain-English Law Dictionary

Legal Dictionary Home

Need Professional Help? Talk to a Lawyer

Enter Your Zip Code to Connect with a Lawyer Serving Your Area

searchbox small
Dividend
A portion of profits distributed by a corporation to its shareholders based on the type of stock and number of shares owned. Dividends are usually paid in cash, though they may also be paid in the form of additional shares of stock or other property. The amount of a dividend is established by the corporation's board of directors; however, state laws often restrict a corporation's ability to declare dividends by requiring a minimum level of profits or assets before the dividend can be approved.
LA-NOLO3:DRU.1.6.1.20140626.27175