We receive call, text, and email messages every year asking if filing certain earnings, in addition to child tax credit, is acceptable. We're going to talk about taxable income today, but before we do, let me just remind you that every case needs to be examined and taken into account using the client intake forms. As with any bookkeeping, payroll, and income tax services, we must advise you that the content provided in the blogs is just that—information.

Use the intake form to get started if you require a professional to review them. 

Having said that, the following income is often not subject to taxes. There are always exceptions. For instance, inheritances are not usually taxed; however, if you received an IRA as a bequest, you will be subject to taxes on the distributions from the account. However certain kinds of income are not taxable for the majority of people:

1. Life insurance proceeds
2. IRA and Pension rollovers
3. Child support payments
4. Inheritances
5. Gifts
6. Workers Compensation
7. Disability payments if you paid the premiums on the policy. If your employer paid the policy, then the disability payments are taxable. If you paid part of the policy, then part of the disability payments you paid are nontaxable.
8. Court damages for personal physical injuries or physical sickness. Punitive payments are taxable.
9. Health and accident benefits
10. Federal income tax refund
11. State income tax refund (if you took the standard deduction last year)
12. Most scholarships, fellowships, and Pell grants
13. Foster care payments (certain restrictions for individuals over age 18 in foster care)
14. Gain on the sale of your personal residence is usually nontaxable. The gain might be taxable if you lived in the residence less than two years or if the residence has ever been used as a rental property or home office
15. Roth IRA qualified distributions
16. Welfare payments
17. Supplemental Security Income (SSI)
18. Social security benefits are either nontaxable or partially taxable. Enter your social security benefits on the Social Security Benefits screen and we'll calculate how much, if any, of your benefits are taxable
19. Cancellation of debt because of bankruptcy or insolvency. Enter your 1099-C or 1099-A on the Canceled Debt screen and we'll calculate how much, if any, of the canceled debt is taxable
20. Veterans Administration disability benefits
21. Pay-for-Performance Success Payments that reduce the principal balance of your home mortgage under the Home Affordable Modification Program
22. Black lung benefits
23. Cash rebates. For example, if you receive a cash rebate of $100 after you purchase a new washing machine
24. Insurance proceeds for theft or damage to your property
25. Utility rebates
26. Long-term care insurance benefits
27. Military allowances
28. Peace Corps living allowances
29. Reimbursement for medical care