If you provide child care, either in the child's home or in your home or other place of business, the pay you receive must be included in your income. You should receive a Form W-2, Wage and Tax Statement, from your employer showing the pay you received for your services.Ĭhildcare providers. Generally, you must include in gross income everything you receive in payment for personal services. In addition to wages, salaries, commissions, fees, and tips, this includes other forms of compensation such as fringe benefits and stock options. In this case, you include the payment in your income as you earn it by performing the services. However, if you use an accrual method of accounting, you can defer prepaid income you receive for services to be performed before the end of the next tax year. Prepaid income, such as compensation for future services, is generally included in your income in the year you receive it. You must include that amount in your income when your former spouse receives it. You and your employer agree that part of your salary is to be paid directly to your former spouse. If you agree by contract that a third party is to receive income for you, you must include the amount in your income when the party receives it.Įxample.
Income received by an agent for you is income you constructively received in the year the agent received it. If the check was mailed so that it could not possibly reach you until after the end of the tax year, and you could not otherwise get the funds before the end of the year, you include the amount in your income for the next year.Īssignment of income. For example, if the postal service tries to deliver a check to you on the last day of the tax year but you are not at home to receive it, you must include the amount in your income for that tax year. You are generally taxed on income that is available to you, regardless of whether it is actually in your possession.Ī valid check that you received or that was made available to you before the end of the tax year is considered income constructively received in that year, even if you do not cash the check or deposit it to your account until the next year.
A list is available in Publication 525, Taxable and Nontaxable Income.Ĭonstructively-received income. Income that is nontaxable may have to be shown on your tax return but is not taxable.
Income that is taxable must be reported on your return and is subject to tax. Generally, an amount included in your income is taxable unless it is specifically exempted by law. Other steps may be appropriate for your specific type of business. The information on this page should not be construed as all-inclusive. It includes discussions on employee wages and fringe benefits, and income from bartering, partnerships, S corporations, and royalties. This section discusses many kinds of income that are taxable or nontaxable. You can receive income in the form of money, property, or services.
0 kommentar(er)
