Individual FAQs - Taxable / Nontaxable Income

The following list is not all-inclusive and should be used as a guide:

  • Wages, salaries and other compensation.
  • Bonuses, stipends and tip income.
  • Commissions, fees and other earned income.
  • Employer provided supplemental unemployment benefits (sub pay).
  • * Stock options (taxed when exercised).
  • Severance pay.
  • Sick pay (excluding 3rd party sick pay).
  • Vacation pay.
  • Employee contributions to retirement plans and tax deferred annuity plans (including Sec. 401k, Sec. 403b, Sec. 457b, etc.).
  • * Any amount attributable to a non-qualified deferred compensation plan included in qualified wages.
  • Self-employment income (Schedule C).
  • Net farm income (Schedule F).
  • * Income from pass-through entities, estates or trusts (Schedule E Part II and Part III).  For RITA residents that are owners of S-Corporations, please refer to the S-Corp. Residence Tax Treatment Summary.
  • * Net rental income.
  • * Lottery/gambling winnings.
  • Oil and gas rights income.
  • Royalties from a tangible income source.
  • Ordinary gains as reported on Federal Form 4797.
  • Employer paid premiums for group term life insurance over $50,000.
  • Compensation paid in goods or services or property usage. Taxed at fair market value.
  • Prizes and gifts if connected with employment to the same extent as taxable for federal income tax purposes.
  • Strike pay.
  • Profit sharing.
  • Uniform, automobile and travel allowances.
  • Reimbursements in excess of deductible expenses.
  • Employer provided educational assistance to the same extent as taxable for federal income tax purposes.

* Exceptions exist. For more information, visit RITA Municipalities, click on your municipality and select the Special Notes section that relates to the appropriate tax year.

The following list is not all-inclusive and should be used as a guide:

  • Interest.
  • Dividends.
  • Capital gains.
  • Social Security.  Note:  If you are retired and have no taxable income you are required to file an Exemption Form the first year that this applies.  You are required to resume filing a Form 37 if your status changes and you receive or earn taxable income.
  • Pension distributions.  Note:  If you are retired and have no taxable income you are required to file an Exemption Form the first year that this applies.  You are required to resume filing a form 37 if your status changes and you receive or earn taxable income.
  • Income from Boards of Elections (voting booth) up to $1,000.00.
  • Workers compensation.
  • Third-party sick pay.
  • Public assistance.
  • State unemployment compensation.
  • Military pay or allowance of members of the Armed Forces of the United States and members of their reserve components, including the National Guard.  Note:  If you are a member of the U.S. Armed Forces (including the National Guard) and had no other taxable income for all of the tax year, you are required to annually file an Exemption Form.  You are required to resume filing a Form 37 if your status changes and you receive or earn taxable income.
  • Alimony received.
  • * Income earned by someone under 18 years of age.
  • Royalties from intangible income sources.
  • Contributions made to Section 125 cafeteria plans.
  • Annuity distributions.
  • Retirement plan distributions.  Note:  If you are retired and have no taxable income you are required to file an Exemption Form the first year that this applies.  You are required to resume filing a form 37 if your status changes and you receive or earn taxable income.
  • IRA distributions.
  • Insurance proceeds.
  • Gross income and gross receipts of religious, fraternal, charitable, scientific, literary or educational institutions to the extent that such income and receipts are derived from real estate, tangible or intangible property or other activities that are tax-exempt.
  • Health and welfare benefits distributed by charitable, religious or educational organizations.

* Exceptions exist. For more information, visit RITA Municipalities, click on your municipality and select the Special Notes section that relates to the appropriate tax year.