Preferred stock is best thought of as being somewhere between debt (bonds) and equity (common stock). Like debt, preferred stock imposes a fixed charge on the firm, affords its holders no voting rights, and has priority over common stock in the event of bankruptcy. However, like equity, its payments are considered dividends from both legal and tax standpoints, it has no maturity date, and it is carried on the firm's balance sheet in the equity section. From a creditor's viewpoint, preferred stock is more like common stock, but from a common stockholder's standpoint, preferred stock is more like debt.