Tax Tips: Income Tax On Which Income?
March 6, 2009 by Be Safe Insure
Filed under 2. Personal Insurance
I came across this neat little article on taxes and insurance. It was posted on msn.com from KHQ-TV. I thought that some tax tips would be timely and appreciated.
“While most income you receive is generally considered taxable, there are some situations when certain types of income are partially taxed or not taxed at all.
Common Examples of Items Not included in your income
* Adoption Expense Reimbursements for qualifying expenses
* Child support payments
* Gifts, bequests and inheritances
* Workers’ compensation benefits
* Meals and Lodging for the convenience of your employer
* Compensatory Damages awarded for physical injury or physical sickness
* Welfare Benefits
* Cash Rebates from a dealer or manufacturer
* Economic Stimulus Payment received in 2008
Some income may be taxable under certain circumstance, but not taxable in other situations.
An important examples of money that may or may not be included in your income is Life Insurance.
Here is how it is dealt with:
If you surrender a life insurance policy for cash, you must include in income any proceeds that are more than the cost of the life insurance policy. Life insurance proceeds paid to you because of the death of the insured person are not taxable unless the policy was turned over to you for a price.
This is just an example.
More info
- The IRS has an all-inclusive informative brochure, which you can download from their website: Publication 525, Taxable and Nontaxable Income (PDF 1178.2KB)
- If you want other information in written form, the IRS’s official government site is http://www.irs.gov/.
- There is also an IRS Tax hotline: Tel. 800-TAX-FORM (800-829-3676).
