Assignment of income
Certified Financial Planner glossary · Certified Financial Planner
Definition
The doctrine taxing income to the person who earns it or who owns the property producing it, regardless of who receives payment.
Assignment of income in plain English
A surgeon tries to route this month's fees to a child's trust to "shift the bracket." Assignment of income says the tax follows the person who earns the income or who owns the property that produces it, regardless of who cashes the check. You can gift the underlying asset; you generally cannot gift the paycheck after it is earned. On stems, separate assigning a right to future property income from trying to redirect already-earned services income.
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