earned income

Earned Income

Income derived from active participation in a trade or business, including wages, salary, tips, commissions and bonuses. This is the opposite of unearned income.

Investopedia Commentary

Basically, this is any income a person or company gets for which they have done the work or put through the effort to obtain. If your boss gives you an advance on your next check, this would be considered unearned income because you haven't yet done anything to earn it.

See also: Active Income, Earned Income, Passive Income, Tip Income, Unearned income

earned income

Individual income, such as commissions, salaries, and bonuses, that is derived as compensation for personal services. Compare unearned income.

Main Entry: earned income
Function: noun
: income (as wages, salary, professional fees, or commissions) that results from the personal labor or services of an individual —compare UNEARNED INCOME