Ten Things You May Not Be Aware of Are Taxable
Tax rules can be complex and there are some items and expenses that you don’t even know you have to pay taxes about. Investopedia lists a number of taxable items that may come as a surprise.
For example, if you pay off your debt, you probably owe taxes on the forgiven amount if it exceeds $ 600.
And it’s not just student loan debt. Investopedia explains:
Forgiven loans . In most cases, you will need to report the amount forgiven as income, whether you have been forgiven by a private company (such as a bank) or the federal government. However, there are some exceptions, for example, if the loan was received from a loved one – they are considered a gift. Also, forgiven debt may not be taxed if it is part of bankruptcy, insolvency, or primary mortgage debt.
And here are a few more general things that might surprise you:
Scholarships and work, study . If you receive a scholarship that pays for anything other than tuition, fees, and textbooks, you must pay taxes on it. Work-study income will also be taxed, although not always at the state level.
Income from unemployment. Will your unemployment benefits be taxed? It depends on which state you live in . In addition to states that do not tax income in any way, some such as Montana, Virginia, New Jersey, California, Pennsylvania are Oregon states that are completely exempt from such benefits. Others require you to pay taxes. To minimize the pain of paying taxes, you can withhold taxes every time you get unemployed, or pay all at once when you file your tax return.
Alimony . Alimony must be listed as income on your tax return. This is confusing to some people who believe it will be treated like alimony that is tax-free.
There are a few more items out there, so you should definitely follow the link below to see the full list.
10 Surprisingly Taxable Articles | Investopedia