Taxable income is money, property or services that taxpayers receive. Most types of income are taxable with a few exceptions. Nontaxable income is may have to be reported on your taxes but is not taxable and is given to an employee or individual without any taxes held. Taxes laws are constantly changing so check with your accountant or the Internal Revenue Service to verify if you income qualifies are taxable or nontaxable. This article will describe a few of the more common categories of nontaxable income.
Government Benefits
- Disability benefits that includes SSI or disability benefits received are not taxable
- Social security benefits but varies by individual and income
- Welfare benefits (TANF)
- Medicare/Medicaid benefits
- Veterans benefits
- Military combat pay
Employer Provided
- Paid meals and lodging, gym membership, corporate credit card, education assistance, adoption assistance, workers compensation, dependent care benefits under certain circumstances
- Employer paid long-term care insurance or health savings account
- Employee achievement award up to $1,600
- Employer paid moving expenses
- Employer transportation benefits
Monies from Legal Actions
- Payments from a state crime victims fund
- Casualty insurance and other reimbursements
- Court awards and damages for emotional distress due to a physical injury or physical sickness
- Court awards and damages you receive for lost pay, punitive damages, business damages
Financial Products
- Death benefits
- Insurance policy payouts
- Dividends that are a return of capital
- Health insurance and accident policy premiums you paid on your own
- ROTH IRA
- Municipal bonds
- Scholarships and fellowships
- Debt included in a bankruptcy