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- Government Payments
- Gambling Winnings
- Gambling Losses
- Alimony Received
- Unreported Tips
- Taxable Scholarship & Household Income
- Alaska Permanent Funds
- Net Operating Losses
- Other Income
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Generally, property you receive as a gift, bequest, or inheritance is not included in your income. However, if property you receive this way later produces income such as interest, dividends, or rentals, that income is taxable to you. If the gift, bequest or inheritance is the income from the property, that income is taxable to you.
If you received any inherited pension or IRA, you may have to include part of the inherited amount in your income. |
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If you receive a scholarship or fellowship grant, all or part of the amounts you receive may be tax–free if you use for qualified education expenses.
Qualified scholarship and fellowship grants are treated as tax–free amounts if all the following conditions are met:
1. You are a candidate for a degree at an educational institution;
2. Amounts you receive as a scholarship or fellowship are used for tuition and fees required for enrollment or attendance at the educational institution, or for books, supplies, and equipment required for courses of instruction; and
3. The amounts received are not a payment for your services.
4. You use the scholarship or fellowship to pay qualified education expense.
If your scholarship or fellowship does not meet the following requirements described earlier, it is taxable like:-
- Amounts used to pay expenses that do not qualify,
- payments for service
- Scholarship prizes if earlier requirement not meet.
For more information refer Publication 970. |
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If you win a prize in a lucky number drawing, television or radio quiz program, beauty contest, or other event, you must include it in your income. For example, if you win a $50 prize in a photography contest, you must report this income as other income. If you receive merchandise, you must report the fair market value of the item(s) as income.
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Unemployment compensation generally includes any amounts received under the unemployment compensation laws of the United States or of a state. You received Form 1099-G showing the amount paid by you. It includes state unemployment insurance benefits and benefits paid to you by a state or the District of Columbia from the Federal Unemployment Trust Fund. It also includes railroad unemployment compensation benefits, but not worker's compensation. It also includes disability payments from a government program paid as a substitute for unemployment compensation. It also includes trade readjustment allowance under the trade act of 1974 and unemployment assistance under the disaster Relief and Emergency Assistance Act.
More information refers Publication 17. |
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Yes, any unemployment compensation benefits that you receive in 2008 from the state or federal government are taxable income and must be reported on your tax return. You'll receive a Form 1099-G. Unemployment compensation benefits received from a union or private fund to which you contribute are taxable on your tax return only to the extent that your unemployment compensation benefits exceed your contributions to the union or private fund. |
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Unemployment benefits from a private fund to which you voluntarily contribute are taxable only if the amounts you receive are more than your total payments into the fund. This taxable amount is not unemployment compensation; it is reported as other income. |
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If you received a state or local income tax refund in 2008, you generally must include it in income if you deducted the tax in a earlier year.
For 2008, the refund that you must include in income is limited to the excess of the tax you chose to deduct over the tax you did not choose to deduct. (More information sees Publication 525 page 20)
If you did not itemize your deductions on your Federal tax return for the same year as the state or local tax refund applies to, do not report any of the refund as income.
If you itemized deductions on your Federal tax return for 2004, and received a refund of state or local taxes in 2004, you may have to include all or part of the refund as income on your 2008 tax return. |
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If you repaid on 2008 unemployment compensation you received in 2008, subtract the amount you repaid from the total amount you received and enter the difference in from 1040. If you repaid unemployment compensation in 2008 that you included in your income in an earlier year, you can deduct the amount repaid. |
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Gambling winnings are fully taxable and must be reported on your tax return. You can deduct gambling losses you had during the year, but only up to the amount of your winnings. |
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Gambling income includes winnings from lotteries, raffles, horse races, and casinos |
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You can deduct gambling losses only if you itemize deductions. However, the amount of losses you deduct cannot be more than the amount of gambling income you have reported on your return. |
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It is important to keep an accurate diary or similar record of your gambling winnings and losses. To deduct your losses, you must be able to provide receipts, tickets, statements or other records that show the amount of both your winnings and losses.
* The records should include a diary of your gambling activities noting
* The date
* The location (name of the establishment and address)
* The names of other people who were there with you
* The amount you wagered
* The type of gambling
* Your winnings
* Your losses |
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Alimony, separate maintenance, and similar payments from your spouse or former spouse are taxable to you in the year received.
A payment to or for a spouse or former spouse under a divorce or separation instrument is alimony, if the spouses do not file a joint return with each other, if the following conditions are met:
1. Payments are required by a divorce or separation instrument.
2. Payer and recipient spouse do not file a joint return with each other.
3. The payment must be made by cash, check, money order, etc.
4. Payment is not designated in the instrument as not alimony.
The spouses are not members of the same household at the time the payments are made or Spouse legally separated under a decree of divorce.
- There is no liability for payments after the death of the recipient spouse.
- The payment is not treated as child support.
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No. When you report the actual tips you have received in the form of cash, check, or charge, in a signed and dated report, you are complying with your legal requirement. Your employer cannot legally ask you to do otherwise.
You employer can use a tip rate lower than 8% (But not lower than 2%) to figure allocated tips only if the IRS approves the lower rate. Either the employer or the employees can request approval of a lower rate by filing a petition with the IRS. The petition must include specific information about the business that will justify the lower rate. A user fee must be paid with the petition. |
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A qualified scholarship is any amount you receive as a scholarship or fellowship grant that is used under the terms of the grant for:
* Tuition and fees required to enroll in, or to attend, an educational institution, or
* Fees, books, supplies, and equipment that is required for the courses at the educational institution. These items must be required of all students in your course of instruction.
Your scholarship or fellowship grant can still qualify as tax free even if the terms do not provide that it be used only for tuition and course-related expenses. It will qualify if you use the grant proceeds for tuition and course-related expenses. However, if the terms of the grant require its use for other purposes, such as room and board, or specify that the grant cannot be used for tuition or course-related expenses, the amounts received under the grant are not tax free. |
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Qualified scholarships and fellowships are treated as tax-free amounts if all of the following conditions are met:
You are a candidate for a degree at an educational institution.
Amounts you receive as a scholarship or fellowship are used for tuition and fees required for enrollment or attendance at the educational institution, or for books, supplies, and equipment required for courses of instruction, and the amounts received are not a payment for your services |
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Yes if you are enrolled in a state or local work-training program & payments received as compensation for services should be seen as wages and thus includable in gross income. |
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The following are examples of Other Income:
* Prizes and awards received other than in connection with your trade or business.
* Fees for jury duty, or as an executor or administrator of an estate.
* Canceled debts – If a debt you owe is canceled or forgiven, other than as a gift or bequest, you may have to include it in income.
* Qualified state tuition program earnings.
* Income from rental of personal property, if you engaged in the rental for profit but are not in the business of renting property.
* Income from an activity not engaged in for profit, such as a hobby.
* Damages received for personal nonphysical injuries or sickness or punitive damages. Damages for emotional distress in a case not involving personal physical injury, except to the extent the damages are paid for medical care.
* Reimbursements or other amounts received for items deducted in an earlier year, such as medical expenses, real estate taxes, or home mortgage interest.
* Loss on certain corrective distributions of excess deferrals
For more information see Publication 525, |
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- A copy of last years tax return
- Personal identification (driver's license, social security card) for you and your spouse, if applicable, showing the SSN (s).
- W-2s from all of your employers
- Forms 1099 & 1099-G, 1099-DIV, 1099-R.
- All receipts pertaining to your small business
- Social security benefits
- Unemployment Compensation
- Other Income
- Income receipts from rental real estate, royalties, partnerships, s corporation, trusts
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