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Simple English definitions for legal terms
transfer payment
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A quick definition of transfer payment:
Transfer Payment: A type of payment made by the government to a person who has not provided any goods or services or invested any money in exchange for the payment. Examples of transfer payments include unemployment compensation and welfare payments.
A more thorough explanation:
A transfer payment is a type of payment made by the government to an individual who has not provided any goods or services in exchange for the payment. These payments are usually made to support individuals who are in need of financial assistance.
Examples of transfer payments include:
- Unemployment compensation
- Welfare payments
- Social security benefits
- Disability benefits
These examples illustrate the definition of transfer payments because they are all payments made by the government to individuals who have not provided any goods or services in exchange for the payment. For example, unemployment compensation is paid to individuals who have lost their jobs and are actively seeking employment. Welfare payments are made to individuals who are unable to support themselves financially. Social security benefits and disability benefits are paid to individuals who are retired or disabled and unable to work.