Taxable and Nontaxable Income

In accordance with the Internal revenue guidelines, the following are some pertinent information that must be considered in determining taxable and nontaxable income for individuals. Also, a description of business entities is provided for guidance.

Individuals

Most types of income are taxable, but some are not. Income can include money, property or services that you receive. Examples of income that are usually not taxable:

Child support payments;
Gifts, bequests and inheritances;
Welfare benefits;
Damage awards for physical injury or sickness;
Cash rebates from a dealer or manufacturer for an item you buy; and
Reimbursements for qualified adoption expenses.

Some income is not taxable except under certain conditions. Examples include:

Life insurance proceeds paid to you because of an insured person’s death are usually not taxable. However, if you redeem a life insurance policy for cash, any amount that is more than the cost of the policy …