What is considered nontaxable income?

The following items are deemed nontaxable by the IRS:

  • Inheritances, gifts, and bequests
  • Alimony payments (for divorce decrees finalized after 2018)
  • Child support payments
  • Most healthcare benefits
  • Money that is reimbursed from qualifying adoptions
  • Welfare payments
  • Money from a life insurance policy
  • Money from a qualified scholarship that is used to pay tuition (not room and board or personal expenses)
  • For the 2020 tax year, up to $10,200 of unemployment benefits (per spouse) is excluded from income.
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