inaccurately representing that the taxpayer sat-
isfies them, the taxpayer may not exclude the
amount of the forgiven loan from gross income
under 15 U.S.C. section 636m(i) or section
276(b)(1) of the COVID-related Tax Relief Act of
2020. For more information, see Forgiveness of
Paycheck Protection Program (PPP) Loans.
Emergency financial aid grants. Certain
emergency financial aid grants under the
CARES Act are excluded from the income of
college and university students, effective for
grants made after March 26, 2020. (See P.L.
116-136 and P.L. 116-260.)
Other loan forgiveness under the CARES
Act. Gross income does not include any
amount arising from the forgiveness of certain
loans, emergency Economic Injury Disaster
Loan (EIDL) grants, and certain loan repayment
assistance, each as provided by the CARES
Act, effective for tax years ending after March
27, 2020. (See P.L. 116-136 and P.L. 116-260.)
Exclusion of income for volunteer firefight-
ers and emergency medical responders. If
you are a volunteer firefighter or emergency
medical responder, you may be able to exclude
from gross income certain rebates or reductions
of state or local property or income taxes and
up to $50 per month provided by a state or local
government. For more information, see
Volun-
teer firefighters and emergency medical res-
ponders.
Repeal of deduction for alimony payments
and corresponding inclusion in gross in-
come. Alimony received under a divorce or
separation instrument executed after 2018
won't be includible in your income. The same is
true of alimony received under a divorce or sep-
aration instrument executed before 2019 and
modified after 2018, if the modification ex-
pressly states that the alimony isn't deductible
to the payer or includible in your income. For
more information, see Pub. 504.
Forms 1040A and 1040EZ no longer availa-
ble. Forms 1040A and 1040EZ aren't available
to file your 2023 taxes. If you used one of these
forms in the past, you’ll now file Form 1040 or
1040-SR.
Qualified equity grants. For tax years begin-
ning after 2017, certain qualified employees can
make a new election to defer income taxation
for up to 5 years for the qualified stocks re-
ceived. See Qualified Equity Grants under Em-
ployee Compensation, later.
Suspension of qualified bicycle commuting
reimbursement exclusion. For tax years be-
ginning after 2017, reimbursement you receive
from your employer for the purchase, repair, or
storage of a bicycle you regularly use for travel
between your residence and place of employ-
ment must be included in your gross income.
Unemployment compensation. If you re-
ceived unemployment compensation but did not
receive Form 1099-G, Certain Government Pay-
ments, through the mail, you may need to ac-
cess your information through your state’s web-
site to get your electronic Form 1099-G.
Achieving a Better Life Experience (ABLE)
account. This is a type of savings account for
individuals with disabilities and their families.
Distributions are tax free if used to pay the ben-
eficiary's qualified disability expenses. See Pub.
907 for more information.
Certain amounts received by wrongfully in-
carcerated individuals. Certain amounts you
receive due to a wrongful incarceration may be
excluded from gross income. See IRS.gov/
Newsroom/IRS-Updates-Frequently-Asked-
Questions-Related-to-Wrongful-Incarceration
for more information.
Foreign income. If you're a U.S. citizen or resi-
dent alien, you must report income from sour-
ces outside the United States (foreign income)
on your tax return unless it’s exempt by U.S. law.
This is true whether you reside inside or outside
the United States and whether or not you re-
ceive a Form W-2, Wage and Tax Statement, or
Form 1099 from the foreign payer. This applies
to earned income (such as wages and tips) as
well as unearned income (such as interest, divi-
dends, capital gains, pensions, rents, and royal-
ties).
If you reside outside the United States, you
may be able to exclude part or all of your foreign
source earned income. For details, see Pub. 54,
Tax Guide for U.S. Citizens and Resident Aliens
Abroad.
Olympic and Paralympic medals and United
States Olympic Committee (USOC) prize
money. If you receive Olympic and Paralympic
medals and USOC prize money, the value of the
medals and the amount of the prize money may
be nontaxable. See the Instructions for Sched-
ule 1 (Form 1040), line 8m, at IRS.gov/
Form1040 for more information.
Public safety officers. A spouse, former
spouse, and child of a public safety officer killed
in the line of duty can exclude from gross in-
come survivor benefits received from a govern-
mental section 401(a) plan attributable to the of-
ficer's service. See section 101(h).
A public safety officer that's permanently
and totally disabled or killed in the line of duty
and a surviving spouse or child can exclude
from income death or disability benefits re-
ceived from the federal Bureau of Justice Assis-
tance or death benefits paid by a state program.
See section 104(a)(6).
Qualified Medicaid waiver payments. Cer-
tain payments you receive for providing care to
an eligible individual in your home under a
state's Medicaid waiver program may be exclu-
ded from your income under Notice 2014-7.
See also Instructions for Schedule 1 (Form
1040), line 8s.
Qualified settlement income. If you're a
qualified taxpayer, you can contribute all or part
of your qualified settlement income, up to
$100,000, to an eligible retirement plan, includ-
ing an IRA. Contributions to eligible retirement
plans, other than a Roth IRA or a designated
Roth contribution, reduce the qualified settle-
ment income that you must include in income.
See Exxon Valdez settlement income under
Other Income, later. Also, see Pub. 590-A for
more information.
Taxpayer identification number (TIN). A TIN
is your social security number (SSN), individual
taxpayer identification number (ITIN), adoption
taxpayer identification number (ATIN), or em-
ployer identification number (EIN).
Terrorist attacks. You can exclude from in-
come certain disaster assistance, disability, and
death payments received as a result of a terro-
rist or military action. For more information, see
Sickness and Injury Benefits, later; Pub. 3920,
Tax Relief for Victims of Terrorist Attacks; and
Pub. 907, Tax Highlights for Persons With Disa-
bilities.
Photographs of missing children. The Inter-
nal Revenue Service is a proud partner with the
National Center for Missing & Exploited
Children® (NCMEC). Photographs of missing
children selected by the Center may appear in
this publication on pages that would otherwise
be blank. You can help bring these children
home by looking at the photographs and calling
800-THE-LOST (800-843-5678) if you recog-
nize a child.
Introduction
You can receive income in the form of money,
property, or services. This publication discusses
many kinds of income and explains whether
they are taxable or nontaxable. It includes dis-
cussions on employee wages and fringe bene-
fits, and income from bartering, partnerships, S
corporations, and royalties. It also includes in-
formation on disability pensions, life insurance
proceeds, and welfare and other public assis-
tance benefits. Check the index for the location
of a specific subject.
In most cases, an amount included in your
income is taxable unless it is specifically ex-
empted by law. Income that is taxable must be
reported on your return and is subject to tax. In-
come that is nontaxable may have to be shown
on your tax return but isn’t taxable.
Constructively received income. If you are a
cash method taxpayer, you are generally taxed
on income that is available to you, regardless of
whether it is actually in your possession.
A valid check that you received or that was
made available to you before the end of the tax
year is considered income constructively re-
ceived in that year, even if you don’t cash the
check or deposit it to your account until the next
year. For example, if the postal service tries to
deliver a check to you on the last day of the tax
year but you aren’t at home to receive it, you
must include the amount in your income for that
tax year. If the check was mailed so that it
couldn’t possibly reach you until after the end of
the tax year, and you otherwise couldn’t get the
funds before the end of the year, you include the
amount in your income for the next tax year.
Assignment of income. Income received
by an agent for you is income you constructively
received in the year the agent received it. If you
agree by contract that a third party is to receive
income for you, you must include the amount in
your income when the third party receives it.
Example 1. You and your employer agree
that part of your salary is to be paid directly to
one of your creditors. You must include that
amount in your income when your creditor re-
ceives it.
Advance payments. Generally, you report an
advance payment for goods, services, or other
items as income in the year you receive the pay-
ment. However, if you use an accrual method of
accounting and are otherwise eligible, you can
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2 Publication 525 (2023)