What is Miscellaneous Income and (most importantly) is it taxable income?
Almost everybody understands that wages, salaries, tips, commissions,
interest and dividends earned are included as income on their tax
return. But what about that “side job†where CASH was received? This, as
well as awards, prizes, contest winnings & gambling winnings, just to
name a few, is fully TAXABLE!
It is a common /misconception/ that if one does not receive a Form
1099-Misc or if one does not receive greater than $600 in “cashâ€, then
that income is not taxable. _*There is no minimum amount that may be
excluded from gross income.*_ Cash received for housecleaning, lawn
cutting and yes, even babysitting are all examples of fully taxable
income, even if you have received less than $600 for the year. Do you
repair computers in your spare time? Fully taxable! Do you style hair in
your basement? Fully taxable! Do you work selling fireworks in the
summer time? Fully taxable! Do you paint houses for extra spending cash?
Fully taxable!
Gambling winnings are fully taxable and includes, but is not limited to,
lottery winnings, raffles, horse races, poker tournaments, casino
winnings prizes such as trips, TVs, cars. Additionally, if you “barterâ€,
trade your services for other services, the fair market value of the
goods or services exchanged is fully taxable to both parties.
So remember, *all income from any source received from anywhere*, even
if you earn those funds while in a foreign country, is fully reportable
and subsequently taxable.
