What is taxable income?


Quick Answer

Taxable income is any money that an individual or company receives from providing goods or services, states the US Tax Center. The IRS considers gross income minus any standard or itemized deductions as taxable income, as of 2015.

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Full Answer

There are several types of income that individuals receive without providing goods or services; therefore, that income is not taxable, according to the IRS. Individuals who receive child support, welfare benefits or generate their income from a worker?s compensation claim do not pay taxes on that money. However, individuals or companies who receive money from investments such as 401(k) plans, dividends from purchasing stocks or generating positive rental income from investment properties are subject to taxes.

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