Capital Contributions

What does Capital Contributions mean in American Law?

The definition of Capital Contributions in the law of the United States, as defined by the lexicographer Arthur Leff in his legal dictionary is:

Things of value (cash, property, services) contributed by partners to a partnership, ordinarily measuring their interest therein. With respect to corporations, while the term might refer generally to capital invested by the shareholders, its more precise reference is to capital, especially additional capital, invested in the corporation but not reflected by the issuance of further stock. For income tax purposes, the capital contribution is added to the stockholder”s basis for his stock, and is not treated as income to the corporation. See I.R.C. § 118.