pro rata


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Pro Rata

[Latin, Proportionately.] A phrase that describes a division made according to a certain rate, percentage, or share.

In a Bankruptcy case, when the debtor is insolvent, creditors generally agree to accept a pro rata share of what is owed to them. If the debtor has any remaining funds, the money is divided proportionately among the creditors, according to the amount of the individual debts.

A pro rata clause in an automobile insurance policy provides that when an insured person has other insurance policies covering the same type of risk, the company issuing the policy with the pro rata clause will be liable only for a proportion of the loss represented by the ratio between its policy limit and the total limits of all the available insurance.

pro rata

(proh rat-ah or proh ray-tah) adj. from Latin for "in proportion," referring to a share to be received or an amount to be paid based on the fractional share of ownership, responsibility, or time used. Examples: an heir who receives one-quarter of an estate may be responsible for one quarter of the estate taxes as his/her pro rata share. A buyer of a rental property will pay his/her pro rata share of the property taxes for that portion of the year in which he/she holds title.

pro rata

adjective alloted, apportioned, distributed, equivalently, in proportion, on even terms, proportionate
Associated concepts: apportionment, pro rata share

pro rata

adverb each to each, in equal shares, respectively, to each according to his share
See also: per capita

PRO RATA. According to the rate, proportion or allowance. A creditor of an insolvent estate, is to be paid pro rata with creditors of the same class.

References in periodicals archive ?
There are occasions, he said, where Home Savings will make loans over its 35 percent pro rata figure.
88-11 What are some of those transactions for which pro rata cost allocation may be inappropriate?
They claimed Keogh retirement plan deductions of over $9,000 in each of those years, which was 15% of their combined Schedule C income plus their pro rata share of the S corporations' income.
If CS did not make the election to treat its tax year as separate tax years, the entire year's income of $15,000 would be allocated pro rata among the shares based on the number of days the shares were held by A and B.
Issuers of debt obligations also have specific guidance with respect to partial redemptions of a debt obligation that qualify as pro rata prepayments.
Instead, for federal income tax purposes, stockholders of AmeriVest on the Record Date will be deemed to own a pro rata share of the assets transferred by AmeriVest to the Trust.
A spinoff may involve either a pro rata or a non-pro rata distribution of stock.
Interest payments on the notes will be made monthly on a sequential basis but pro rata among the class A-1 and A-2 notes.
1295 to treat the PFIC as a QEF and currently includes his pro rata share of the PFIC's realized earnings and gains in the shareholder's income in years for which the PFIC test is met.
The SL Green merger agreement also provides that as part of the merger consideration shareholders of Reckson at the closing of the merger will be paid an amount equal to an adjusted pro rata dividend.
The tax adviser determines that corporate items of income, loss, deduction or credit normally are allocated between the S corporation portion of the year and the C corporation portion of the year on a pro rata basis.