Amortization vs. Capitalization — What's the Difference?

Amortization (or amortisation; see spelling differences) is paying off an amount owed over time by making planned, incremental payments of principal and interest. To amortise a loan means "to kill it off".

Capitalization (American English) or capitalisation (British English) is writing a word with its first letter as a capital letter (uppercase letter) and the remaining letters in lower case, in writing systems with a case distinction. The term also may refer to the choice of the casing applied to text.

The act or process of amortizing.

The practice or act of capitalizing.

The money set aside for this purpose.

The sum that results from capitalizing.

In reckoning the yield of a bond bought at a premium, the periodic subtraction from its current yield of a proportionate share of the premium between the purchase date and the maturity date.

The amounts and types of long-term financing used by a firm, including common stock, preferred stock, retained earnings, and long-term debt.

The reduction of loan principal over a series of payments.

The total par value or stated value of no-par capital stock issues.

The distribution of the cost of an intangible asset, such as an intellectual property right, over the projected useful life of the asset.

The use of capital letters in writing or printing.

The act or right of alienating lands to a corporation, which was considered formerly as transferring them to dead hands, or in mortmain.

Standard spelling of from2=Oxford British spelling

The extinction of a debt, usually by means of a sinking fund; also, the money thus paid.

The act or process of capitalizing.

The reduction of the value of an asset by prorating its cost over a period of years

Writing in capital letters

Payment of an obligation in a series of installments or transfers

An estimation of the value of a business

The act of capitalizing on an opportunity

The sale of capital stock