Wouldn't it be nice to have a source of nontaxable income? You may be more fortunate than you realize. Listed here are a number of income items that the IRS does not tax.
5. Child support received. Unlike alimony you receive, child support income is free from federal tax.
6. Car pool revenue. While commuting expenses are not generally deductible, any reimbursement of your commuting expenses by fellow passengers is not reportable as income.
7. Home sale gains. Up to $250,000 ($500,000 for married filing jointly) of capital gains on a sale of your principal residence can be tax free.
8. Up to 14 days of rental income. If you rent out your home or vacation property, up to 14 days of this rental income each year can be tax free.
9. Certain employer compensation. In addition to health care premiums there are a number of employee benefits that are not taxable. All have limits, but every tax-free dollar is money in your pocket. These include:
Remember when you pay for something in pre-tax dollars it's like giving yourself a raise. Because of this, be sure you take advantage of as many tax-free income opportunities as possible.
Should any of these situations apply to you, please ask for a review of your circumstances, as establishing basis can become fairly complex.
As always, feel free to pass this Tip along to friends, and reach out if you need help with your personal tax and finance situation.
The IRS has announced collection activity will now be starting, so be prepared and ask for help if you are impacted by this change within the IRS.
DiSabatino CPA
Michael DiSabatino
651 Via Alondra Suite 715
Camarillo, CA 93012
Phone: 805-389-7300
ww.sharpcpa.com
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