CHAPTER9

Tax-Free “Unordinary” Income from Non-Investment Sources

What Name Do We Give It?

There are several sources of income that don’t fit nicely into a particular category, such as employment income, investment income, or business income. These sources don’t really even fit into the “other ordinary income” category, in large part because these sources of income are often tax-free and don’t come as a result of normal income-generating activities. Thus I group all of these sources into one chapter and called them “unordinary” income. Included in this newly named category are:

  • Workers’ Compensation
  • Disability income
  • Gifts and inheritance
  • Scholarships and grants
  • Insurance proceeds
  • Lawsuit proceeds

The first two items on the list, Workers’ ...

Get Tax Insight: For Tax Year 2014 and Beyond, THIRD EDITION now with O’Reilly online learning.

O’Reilly members experience live online training, plus books, videos, and digital content from 200+ publishers.