What Is Considered Taxable Income

2006-01-12

Many people these days are looking for ways to earn additional money. Some earn their living by all cash transactions, like waiters, doormen, and other service related positions. When it comes to paying taxes, here is a list that is typically considered as taxable income.

1. Any income that is earned from an employer in exchange for services rendered.
2. Tips
3. Odd, spare, or part time jobs
4. Interest earned on money from banks, investments, etc.
5. Profits from the sale of investments, real estate or stocks
6. Alimony
7. Social Security checks and some forms of retirement savings.
8. Lawsuit settlements
9. Lottery or gambling winnings

There are a few sources of income that are not taxable. These nontaxable income sources include:

1. Scholarships received for the pursuit of higher education
2. Inheritance – Money received after the estate taxes have been paid.
3. Life insurance payouts to which you are the beneficiary
4. Supplemental Health Insurance benefits if the premiums were paid for with after tax dollars

It is the responsibly of the taxpayer to file all income received. Companies are only required to issue 1099 forms for earning of $600 or more in a calendar year.

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