Hello everyone, I hope all is well, as I sit here studying for my Enrolled Agent Qualification you begin to realize there is more to Accounting and Preparing Taxes than just numbers you must know what INCOME IS TAXABLE, AND What INCOME MEANS ACCORDING TO THE IRS TAX FORM 1040. That is what this post will be about. I will do a basic run down of what Qualifies as Income for anyone interested in defining definitions. Income for Business Owners, Fund Managers, Individual W-2 employee’s, 1099 Contractors, Resident Aliens, or even Part time Aliens abroad. I will also detail, explain and provide some free resources for you as I detail INCOME detailed stated by the IRS Form 1040. Tax Advisors absolutely add value in the Board Room and in the Operations Office. This will be a-lot of fun! Let’s get the party started!
Free TAX Resources For Tax Preparers and Individuals or even Investment Firms Shops/IAR’s to Family Office Advisors.
If your not well versed in Accounting talk? Don’t worry Neither am I? However if there is one Publication that needs to be read and put on your Desk as a Employee or in your Household for the stay at home Mom we see on shows like lovely Oprah, this Publication needs to be consumbed in it’s entirety. That publication provided by the United States IRS is “Publication 17”. According to the IRS they describe Publication 17 as: “Publication 17 covers the general rules for filing a federal income tax return. It supplements the information contained in your tax form instruction booklet.” BOOK HERE
TYPES OF TAXABLE INCOME (KA-CHING!)
First of all what is Taxable Income According to the IRS? According to IRS Content on the IRS website states: Internal Revenue Service Most income is taxable unless it’s specifically exempted by law. Income can be money, property, goods or services. Even if you don’t receive a form reporting income, you should report it on your tax return.
Income is taxable when you receive it, even if you don’t cash it or use it right away. It’s considered your income even if it’s paid to someone else on your behalf.
Types of taxable income
Taxable income can include payments you receive from: EMPLOYMENT
WAGES and Employment Benefits: Included on IRS FORM W-2,
Self-employment or side jobs
Freelance or independent contractor work
Goods or services you sell online
Gig work or side jobs, often through apps
Renting out personal property
Bartering services or goods
Royalties
Businesses
Partnerships or other business entities
Investments – “INVESTMENT PROFESSIONALS PAY ATTENTION!”
Capital gains
Stock options, splits or trades
Interest
Dividends
Digital assets or cryptocurrency
Benefits paid to you
Retirement plan distributions, pensions or annuities
Unemployment benefits
Social Security income
Some life insurance proceeds
Some survivor benefits
Other types of income
Tax refunds, reimbursements and rebates
Canceled debts
Alimony payments
Court awards and damages
Some scholarships
Gambling winnings
Prizes and awards
Related
Taxable and Nontaxable Income, Publication 525
Your Federal Income Tax, Publication 17
FREE TAX RESOURCES YOU NEED!
I must give a nice Thank you to all the Enrolled Agents out there and Accountants an Tax Attorneys for providing great content as I continue to build my path moving forward as a Professional earning my Enrolled Agent Qualification. There are free resources avaliable. And this short list is really helpful to other Investment, Family Office, Bankers, and Accountants, Tax Professionals or just anyone who is in the Professional Space. This resource guide is meant for you!
Publication 17 by the IRS, Instruction For Forms 1040-1040SR, Publication 501, Exemptions, Standard Deductions and Filing Info, Publication 504 by the IRS covers Divorced or Separated Individuals,IRS Publication 519 US TAX Guide for Aliens, IRS Publication 54 Tax Guide for US Citizens and Resident Aliens Abroad, Publication 552 Record Keeping for Individuals.
Tax Influencers on Youtube and Social Media you should be following and watching.
The Tax Advisor Space is a niche space and you better believe your Institution and or Small Business owned Family preparing their employment W-2 for tax day will find great content and tips to strategy to lighten and educate themselves on the Tax side we all must deal with as US Citizens. Here are a few Tax Professionals I watch, and you should watch as well!
Mark Kohler is a Tax Attorney his channel has millions of views and incredible content. I advocate watching Mark and his Guests.He does a great job instructing and I enjoy his channel.
https://www.youtube.com/@MarkJKohler
Jasmine Delucci is another Tax Attorney and Enrolled Agent I watch on Instagram. She is fantastic with her Social Strategy.
https://www.youtube.com/@taxleverage/shorts
In Conclusion
With all the Free Resources I just provided, and answering the basic question “What is taxble Income?” You should be well on your way as a Accountant Major Studying for your CPA exam, Individual Employed Tax Payer, Small Buisness Owner or even a new budding Tax Attorney or Enrolled Agent seeking resources in one location to get you moving in the right direction. This is meant to keep you curious and educate the Tax Payer on basic terms like “What is Taxable Income” and share some entertaining resources and content for you to consume as you run your business or maybe you have a question that needs answered and if you do? You will find these resources more than adequate to develop and find a answer. And with all this information I just provided? Thank you for reading. I wish you well and please do come back soon. Good Night and Good Luck! JS.