Most Income Received is Taxable - But Not All of It

1. Non-Taxable/Partially Taxed Income
   • Reimbursement for Qualifying Adoption Expenses
   • Child Support Payments
   • Gifts, bequests & inheritances
   • Workers' Compensation Benefits
   • Meals & Lodging for the Convenience of one's Employer
   • Compensatory Damages Awarded for Physical Injury or Physical Sickness
   • Welfare Benefits
   • Cash Rebates from a Dealer or Manufacturer


2. Life Insurance Proceeds
   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.


3. Scholarships & Fellowship Grants
   Another example of income that you may or may not exclude is a scholarship or fellowship grant. Those who are candidates for a degree can exclude amounts received as a qualified scholarship or fellowship. Amounts used for room and board do not qualify.

Disclaimer: Any US tax advice included in this written or electronic communication was not intended or written to be used, and it cannot be used by the taxpayer, for purpose of avoiding any penalties that may be imposed under the Internal Revenue Code or applicable state or local tax law provisions.

The content of this transmission does not constitute a professional service. Always consult with a competent professional service provider for advice on tax, accounting and other financial matters specific to your situation. If you wish to engage our firm for this purpose, please contact our office.