Small Business Taxes & Management


Other Income Items Form 1040


Small Business Taxes & ManagementTM--Copyright 2015, A/N Group, Inc.


There are a number of items that are includable in income where there's no specific place on the tax return. These items are generally reported on Line 21 of Form 1040. Keep in mind that many of these items require special treatment. For example, cancellation of debt income may be nontaxable or partially taxable. Business related items are generally excluded in the list below and may get different treatment. For example, a rebate on the purchase of a car is nontaxable to an individual, but a business must reduce it's cost basis in the vehicle by the amount of the rebate. Finally, the list below includes the most commonly encountered.


Other Income (and Losses), Form 1040, Line 21

___ Prizes and awards (there are some limited exceptions)
___ Jury duty pay (special rules apply)
___ Gambling winnings (gross amount; with or without W-2G; lotteries; raffles; etc. deduct losses on Schedule A)
___ Net operating loss (NOL) carryforward
___ Cancellation of debt income (COD) (nonbusiness)
___ Cancellation of debt income (business) from Schedule K-1
___ Other income from Schedule K-1
___ Reimbursements for amounts deducted in prior years including
     ___ Real estate taxes
     ___ Medical expenses
     ___ Home mortgage interest
     ___ General sales tax
___ Child's income amount from Form 8814, line 12
___ Amounts on 1099-MISC in boxes 3 or 8
___ Rental of personal property (if not in the business of renting such property)
___ Income from an activity not engaged in for profit (hobby income)
___ Reemployment trade adjustment assistance payments (RTTA)
___ Dividends on life insurance policies that exceed all net premiums
___ Recapture of charitable contributions relating to fractional interest in tangible personal property
___ Recapture of charitable contributions where organization disposes of property within 3 years
___ Recapture of prior year tuition and fees deduction
___ Long-Term care distribution (Form 8853)
___ Loss on excess deferral distribution
___ Income from foreign corporation (Form 5471)
___ Alaska Permanent Fund dividends
___ Taxable distributions from a Coverdell education savings account
___ Taxable distributions from a qualified tuition program (QTP; Sec. 529)
___ Taxable distributions from a health savings account
___ Taxable distributions from an Archer MSA
___ Medicare Advantage MSA distributions (Form 8853)
___ Deemed income from HSA individual not eligible during testing (Form 8889)
___ Taxable part of disaster relief payments (Pub. 525)
___ Credit adjustment biofuels; Form 6478 and Form 8864
___ Value of free tour for organizing group (unless trade or business; then Schedule C)
___ Found property (taxable at fair market value in year in undisputed possession)
___ Bribes, kickbacks, embezzlement income, etc.
___ Rewards for providing information
___ Personal expenses paid by another party (may be excludable in certain circumstances)
___ Credit card insurance benefits received under a credit card disability or unemployment insurance plan


Nontaxable Income

Certain other amounts received are generally nontaxable. They include:

___ Child support
___ Help to pay a mortgage under HFA Hardest Hit Fund or Emergency Home Affordable Loan Program or state program
___ Pay for Performance Success Payments that reduce balance of home mortgage under Home Affordable Modification Program
___ Life insurance proceeds (other than certain employer-owned plans)
___ Gifts and inheritances (gifts from foreign persons exceeding $15,358 (2014 amount) reportable Form 3520)
___ Disability income (if you paid the policy premiums; part or all taxable if premiums paid by someone else)
___ Certain noncash employee achievement awards
___ Utility rebates or credits (e.g., for energy conservation)
___ Qualified scholarships and fellowships
___ Amounts received to travel to a job interview
___ Disaster mitigation payments


Copyright 2015 by A/N Group, Inc. This publication is designed to provide accurate and authoritative information in regard to the subject matter covered. It is distributed with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional service. If legal advice or other expert assistance is required, the services of a competent professional should be sought. The information is not necessarily a complete summary of all materials on the subject. Copyright is not claimed on material from U.S. Government sources.--ISSN 1089-1536

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--Last Update 03/05/15