The Tax Questions Blog

Posts Tagged ‘ubit’

Question: is non compete income taxable?

Answer: Yes. It's considered the same as payment for services. If you are in the same business elsewhere, you can include it on your schedule C.

Understanding Your Tax Returns: Your Income, And Your Adjustments To Income Understanding Your Tax Returns is a new series of tax publications designed to help taxpayers across the USA. The objective of these publications is to help taxpayers to understand United States income tax code as far as Form 1040; US Individual Tax Returns is concerned. With a good basic knowledge of the tax code, taxpayers will potentially be in the position to literally increase their income ta...

Non-taxable incomes; a book of important information for investo ...

Non-taxable incomes; a book of important information for investors (1913) This book, "Non-taxable incomes; a book of important information for investors (1913)", by Geiger-Jones Co. (Canton, Ohio), is a replication of a book originally published before 1913. It has been restored by human beings, page by page, so that you may enjoy it in a form as close to the original as possible. This book was created using print-on-demand technology. Thank you for supporting classic l...

A tax regime that works | Nizar Manek

Speculation is growing that the next budget will narrow the gap between the rates of income tax and capital gains (CGT). This might seem irrelevant to most taxpayers, but the

Alex Jones Tv {Sunday Edition} 7/8:Pelosi "Buy a $15,000 Policy or Go to Jail"

Question: What is considered taxable income?

I may have some income resulting from (three different) lawsuits and/or pre-trial settlements for three unrelated things:

1. Bodily injury from a car accident
2. Civil Rights violation (improper actions by police)
3. Illegal termination due to violation of FMLA

What are the tax implications from each of these lawsuits? What suggestions can you provide to structure settlements so they result in the minimum amount of tax owed (if any at all)?
For #3 above, the employer offered a severance package which if accepted, would result in normal payroll taxes as if I had actually worked during that period. I want to specifically structure the settlement so the monetary award is for something other than those wages to avoid the payroll taxes.

Answer: Section 61(a) of the internal revenue code specifies that gross income includes all income from whatever source derived. Thus, all income is included unless there is a specific exclusion.

The only exclusion that seems applicable for your situation is IRC section 104(a)(2) which excludes damages for physical injury. However, punitive damages from such an accident are not excluded. Thus, you should structure the settlement so that as much as possible is for compensation of the injury: including physical injury, non-pecuniary damages, and lost wages.

Unfortunately, a lost wages settlement from a non-physical injury do not appear to be excluded. Neither do damages from a civil rights suit.

Royalty from sale of interest in scholarly journal not taxable.: An article from: The Tax Adviser $5.95 This digital document is an article from The Tax Adviser, published by Thomson Gale on May 1, 2006. The length of the article is 863 words. The page length shown above is based on a typical 300-word page. The article is delivered in HTML format and is available in your Amazon.com Digital Locker immediately after purchase. You can view it with any web browser.Citation DetailsTitle: Royalty from sal...

Charitable trust's receipt of UBTI caused all income to be taxable. (unrelated business taxable income): An article from: The Tax Adviser $5.95 This digital document is an article from The Tax Adviser, published by American Institute of CPA's on June 1, 1997. The length of the article is 861 words. The page length shown above is based on a typical 300-word page. The article is delivered in HTML format and is available in your Amazon.com Digital Locker immediately after purchase. You can view it with any web browser.From the supplier: The ...

Affinity card income not UBTI. (unrelated business taxable income): An article from: The Tax Adviser $5.95 This digital document is an article from The Tax Adviser, published by American Institute of CPA's on January 1, 1998. The length of the article is 709 words. The page length shown above is based on a typical 300-word page. The article is delivered in HTML format and is available in your Amazon.com Digital Locker immediately after purchase. You can view it with any web browser.From the supplier: T...

Finance and Banking

The best thing we can say about this edition of Tax Talk is that, from the standpoint of the global capital markets, things are not as bad as they were a year ago. When we published our Q4, 2008 issue, the financial world, it seemed, stood at the edge of economic collapse.