Flood Warning expires at 5:29 PM on 4/22, issued at 5:29 PM Argyle, NY | Buskirk, NY | Cambridge, NY | Clemons, NY
A home office
The Internal Revenue Service allows certain deductions to be made on your taxable income if you use your home as a principle place of business. These deductions can include a portion of your real-estate taxes, mortgage payments, and utility expenses.
About alimony
Alimony can be either taxable or deductible. Whichever category it falls into depends on how your divorce settlement was negotiated. Alimony payments that meet tax law tests may be deductible if you pay them, and they may be taxable if you receive them.
Business expenses and income
If you're a sole proprietor of a business or a professional who owns a practice, you must report your income and expenses on Schedule C of Form 1040. If you own more than one business, you must prepare a separate Schedule C for each business.
Capital gains and losses
Capital gains and losses are monetary amounts that result from the sale or exchange of a capital asset. Generally, for individuals in tax brackets of 28 percent or less, capital gains are taxed like regular income.
Estimated tax
Estimating your tax liability to derive an 'estimated tax' is the method you use to pay tax on income not subject to withholding. If you don't pay enough tax through withholding, you might have to pay estimated tax.
Income from interest
You have to pay taxes on just about all the income you receive from interest, regardless of the source. This includes interest on savings accounts, notes, loans, and bonds, except for state and municipal bonds.
Income from partnerships
The IRS does not consider a partnership a taxable entity. Income from a partnership is dispersed to the partners based on each partner's distributive share.
Income from your job
Income from your job is any payment you received for performing services. These payments can be in the form of wages and salary, property, or services.
Inheritances and gifts
Any money or property you receive as an inheritance or a gift is not considered taxable income. However, if the inheritance or gift is used to produce income such as interest, dividends, or rent, then that income becomes taxable.
Insurance settlements
Income received from an insurance settlement generally isn't subject to tax unless you paid to have the policy transferred to you. The interest paid when dividends are left with an insurance company, however, is reported to the taxpayer as interest and is taxable.
Lottery and gambling winnings
You may have gotten lucky at the track or by scratching off a lottery ticket, but your winnings are still taxable. Assuming you're not a professional gambler, you should report your winnings as 'other income' on line 21, Form 1040.
Pension income
If you receive income from a pension, you must report it on your Federal Income Tax return. How your pension income is taxed depends on a variety of factors.
Rental income
Though all income received from rental property is taxable, the IRS (I-R-S) allows for many possible deductions to be made on the income. These deductions can include depreciation costs of your building, furniture, and appliances, as well as utility expenses, mortgage interest, and insurance premiums.
Social Security income
Taxable Social Security benefits include monthly disability and survivor benefits. Supplemental Security Income, or SSI (S-S-I) payments are not taxable.
Tax for the self-employed
If you're self-employed, most likely, you do not have taxes automatically withheld for Social Security and Medicare. Therefore, you're required to pay a self-employment tax to support these two programs.
Tax withholding
Tax withholding is the amount of income your employer withholds from your earnings to pay income tax. Certain other income, including pensions, bonuses, commissions, and gambling winnings may also be subject to tax withholding.
Unemployment benefits
The IRS (I-R-S) considers unemployment benefits to be income, which means you will have to pay taxes on them. Taxable unemployment benefits include state unemployment insurance benefits; benefits paid from the Federal Unemployment Trust Fund; railroad unemployment compensation benefits, disability payments from a government program; Trade readjustment allowances under the Trade Act of 1974; benefits under the Airline Deregulation Act of 1978; and benefits under the Disaster Relief Act Amendments of 1974.


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