Taxable Income vs. Here's what you should know.
The following items are deemed nontaxable by the IRS: Inheritances, gifts and bequests Cash rebates on items you purchase from a retailer, manufacturer or dealer Alimony payments for divorce decrees finalized after Child support payments Money that is reimbursed from qualifying adoptions Welfare payments Under certain circumstances, the following items may be nontaxable. TurboTax can help additional income definition determine what should be included in your return.
Money you receive from a life insurance policy when someone dies is not taxable. However, if you cash in a life insurance policy, then a portion, if not all of it, is likely taxable.
Money from a qualified scholarship is not taxable. However, if you use the money for room and board, or use it to pay other personal expenses, that portion is normally taxable.
Compensation Generally, income can be received in three ways: money, services and property.
But, you can also pay tax on income not yet in your possession. The IRS requires that you declare all income on your return. This can include: Wages.