What’s NOT Included in Your Gross Income

Here is a list of what’s NOT included in your gross income (line 22 of your tax return).  These are the best types of income to receive because you don’t have to pay taxes on it!:

  • gifts (like money you receive for your wedding gift, your birthday, Chinese New Year, etc.)
  • inheritance
  • non-cash fringe benefits (these are perks you get at work like free donuts, free coffee, etc.)
  • return of basis (this is the original amount you put into your investments)
  • employer contributions to certain health insurance plans (i.e. HSA, MSA, or cafeteria plan)
  • when your employer pays for the premiums of your group term life insurance (up to a death benefit of $50,000)
  • workers compensation (income you receive from getting injured at work)
  • child support
  • benefits received under your health plan
  • educator assistance up to $5,250 (when your employer pays for your education, you don’t have to pay taxes on the first $5,250)
  • death benefit of life insurance
  • personal injury damages
  • scholarships & fellowships
  • employer provided dependent care up to $5,000
  • employer contribution to a qualified retirement plan (like when your employer matches your 401k)
  • Roth IRA distributions (because you used after-tax dollars to fund this account)

Click here for a list of income you DO have to pay taxes on.


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