Stimulus Check Taxable...?

Stimulus Check Taxable?  Well, Biden, on his Friday press briefing, said "The third stimulus checks $1400 per person could start going out as soon as this weekend to those who qualify for a payment..." (Friday, 3-12-2021)

According to CNBC and IRS, neither of the two previous stimulus checks delivered in 2020 is considered taxable, ″...the Payment is not includible in your gross income. Therefore, you will not include the Payment in your taxable income on your Federal income tax return or pay income tax on your Payment. It will not reduce your refund or increase the amount you owe when you file your 2020 Federal income tax return.”

What is Taxable and Nontaxable Income? According to IRS, you can receive income in the form of money, property, or services. IRS explains and discusses many kinds of income that are taxable or nontaxable… Generally, an amount included in your income is taxable unless it is specifically exempted by law. Taxable income must be reported on your return and is subject to tax. Income that is nontaxable may have to be shown on your tax return but is not taxable. A list is available in Publication 525, Taxable and Nontaxable Income.

Employee Compensation (Generally, you must include in gross income everything you receive in payment for personal services. In addition to wages, salaries, commissions, fees, and tips, this includes other forms of compensation such as fringe benefits and stock options.), Fringe Benefits, Business and Investment Income, Partnership Income, S Corporation Income, Royalties, Virtual Currencies, Bartering 

On Retirement Income:  Is Retirement Income taxable? It depends on where your retirement income comes from and how much of it you will have. The major types of retirement income are either taxable, partially taxable, or tax-free. Learn which types of retirement income you will need to pay tax on, including pensions, retirement plans, Roth IRAs, and more. Taxable Sources of Retirement Income: Withdrawals from retirement plans: If a plan was funded with pretax dollars, whether by you or your employer, it will result in taxable retirement income when withdrawn. Expect withdrawal from traditional IRA, 401(k)s, 403(b)s, SEPs, and other similar types of plans to be taxable such as Pension income, Investment income in non-retirement accounts, Withdrawals from an annuity, Social Security (Anywhere from 0% to 85% of your SSA may be taxable), Nondeductible IRA withdrawals, Income from an immediate annuity that was purchased with after-tax money, Cashing in a cash-value life insurance policy: Cash-value life insurance policies have a cost basis, usually the total of all premiums you have paid. If your cash value exceeds your basis when you cash in the policy, that portion will be taxable.

Tax-Free Retirement Income: The following sources of retirement income are generally tax-free: (Roth IRA withdrawals, Interest income from municipal bonds, Income from a reverse mortgage, Any return of principal or cost basis, Gain from the sale of your home…)

Calculating Taxes in Retirement, in all cases, refer to IRS guidelines when paying estimated taxes or preparing your tax returns. The rules for what are and is not taxable may change unexpectedly, depending on new state and federal laws. And, if you are unsure whether your retirement income is taxable, and at what rate, consult a tax specialist to ensure that you avoid any IRS penalties or audits. 

Tax filing also begins a little later this year: The IRS will begin accepting and processing 2020 tax year returns on Feb. 12 — as opposed to late January as it does most years — to give the agency time to prepare for the new stimulus paperwork. The deadline to file still remains April 15.

Note. The information contained in this article is not tax or legal advice and is not a substitute for such advice. State and federal laws change frequently, and the information in this article may not reflect your own state’s laws or the most recent changes to the law. For current tax or legal advice, please consult with an accountant or an attorney.

More information: 

What is Taxable and Nontaxable Income? | Internal Revenue Service (irs.gov)

What Types of Retirement Income Are Taxable? (thebalance.com)

https://a.msn.com/00/en-us/BB1ew8h2?ocid=se

And other State resources...

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US Market on 3/12/2021:   DOW-32,778; S&P500-3,943; NASDAQ-13,319; Gold-1,725.80;    Oil: 65.56;   US 10-Year: 1.625% 

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