Guam § 34104 - Definition of Earned Income.

§ 34104. Definition of Earned Income.

For purposes of this Chapter, the term earned income means wages,

salaries or professional fees and other amounts received as compensation

for personal services actually rendered, but does not include that part of

the compensation derived by the taxpayer for personal services rendered

by him to a corporation which represents a distribution of earnings or

profits rather than a reasonable allowance as compensation for the

personal services actually rendered. In the case of a taxpayer engaged in

a trade or business in which both personal services and capital are

material income-producing factors, under regulations prescribed by the

Director of Revenue and Taxation (the Director), a reasonable allowance

as compensation for the personal service rendered by the taxpayer, not in

excess of thirty percent (30%) of his share of the net profits of such trade

or business, shall be considered as earned income.