Types of Taxable Income

What is Taxable Income?

• Taxable income refers to the amount of income that is subject to taxation by the government.
• It is the income that is earned by an individual or business during a tax year that is liable to taxation.

Types of Taxable Income:

• Earned Income: Wages, salaries, bonuses, commissions, and tips received from an employer.
• Unearned Income: Interest, dividends, capital gains, and rents received from investments and assets.
• Self-Employment Income: Income earned from running a business or profession, including income from freelance work.

Taxable Income Sources:

• Employment Income: Salaries, wages, bonuses, and other forms of compensation received from an employer.
• Investments: Interest, dividends, and capital gains from investments in stocks, bonds, mutual funds, and other financial instruments.
• Business Income: Income earned from running a business, including income from sales, services, and other business activities.
• Rental Income: Income earned from renting out properties, such as apartments, houses, or commercial buildings.

What is Not Taxable Income?

• Gifts: Gifts received from others, such as inheritances, bequests, and gifts from friends and family.
• Life Insurance Proceeds: Proceeds from life insurance policies, including death benefits and cash surrender values.
• Scholarships: Scholarships and fellowship grants received for education and research purposes.
• Welfare Benefits: Government welfare benefits, such as social security benefits, unemployment benefits, and worker's compensation benefits.

Note: The specific definitions and exclusions of taxable income may vary depending on the jurisdiction and tax laws.

What is Taxable Income?

• Taxable income is the amount of income subject to taxation by the government.
• It is the income earned by an individual or business during a tax year that is liable to taxation.

Types of Taxable Income

• Earned income includes wages, salaries, bonuses, commissions, and tips received from an employer.
• Unearned income includes interest, dividends, capital gains, and rents received from investments and assets.
• Self-employment income includes income earned from running a business or profession, including freelance work.

Taxable Income Sources

• Employment income includes salaries, wages, bonuses, and other forms of compensation received from an employer.
• Investments include interest, dividends, and capital gains from investments in stocks, bonds, mutual funds, and other financial instruments.
• Business income includes income earned from running a business, including income from sales, services, and other business activities.
• Rental income includes income earned from renting out properties, such as apartments, houses, or commercial buildings.

What is Not Taxable Income?

• Gifts received from others, such as inheritances, bequests, and gifts from friends and family, are not taxable.
• Life insurance proceeds, including death benefits and cash surrender values, are not taxable.
• Scholarships and fellowship grants received for education and research purposes are not taxable.
• Government welfare benefits, such as social security benefits, unemployment benefits, and worker's compensation benefits, are not taxable.