What is Income?

 

Today TaxMama hears from Jude in the Tax Quips Forum, with a wise question. “After reading about how barter and other unthought-of things are considered taxable, I started wondering. Are any of the following considered taxable – and how much is worth worrying about?” And Jude lists a few common happenings – which you can read.

 

 

 Chuckle, that’s a good question, Jude.

Technically, all of those things are in some way income, perhaps they should be reported – except for the loan repayment.

 But, no. Instances where you volunteer and need to be at an event because you’re volunteering to work at it – not income. The free class because you’re low-income – and the benefit is available to all people in the same situation – not income. (It costs the organization nothing extra for the extra bodies, anyway.)

The leftover shingles and such are a gift from a friend.

Now…that scratcher ticket is income and should, technically, be reported. However, winning a couple of bucks now and then – especially since it’s rolled back in… I wouldn’t sweat it. Particularly if the total winnings are under $100 or so a year.

 But…those freebie CDs, etc? Those might be considered income. It depends on why you are getting them for free. If they are free as part of a general promotion to the public, not income.  If they come to you without your request – free stuff in the mail you never ordered – not only are you not required to return unsolicited merchandise, it’s not taxable income either.

If they are free because you are a reviewer and they send you these things to try out and write about – they are taxable income. Of course, you could always donate them to charity and get the corresponding charitable contribution write-off!

 Anyway, you get the general idea.

And remember, you can find answers to all kinds of questions about income and other tax issues, free. Where? Where else? At www.TaxMama.com.

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