Legal Definition of Dividend: A fund set aside by a corporation composed of profits that will be apportioned to its various stockholders. When a corporation is profitable, its board of directors will usually declare a dividend. When the corporation fails to make money for any prolonged period of time, it may skip or fail to declare dividends | Learn the legal definition of dividend and why it matters for business owners. Discover how profits are distributed to stockholders and why failing to declare dividends can have negative effects. Make informed decisions for the long-term success of your corporation. Click to learn more