MANAGEMENT

Detailed explanation-1: -Unearned income is not acquired through work or business activities. Examples of unearned income include inheritance money and interest or dividends earned from investments. Tax rates on unearned income are different from rates on earned income.

Detailed explanation-2: -Unearned income is cash received in advance of earning income. Unearned income is income that is received before it is earned by goods being delivered or services being performed, or income that you do not have to work to earn, such as income from property and investment.

Detailed explanation-3: -Unearned Income. Unearned income includes investment-type income such as taxable interest, ordinary dividends, and capital gain distributions. It also includes unemployment compensation, taxable social security benefits, pensions, annuities, cancellation of debt, and distributions of unearned income from a trust.

Detailed explanation-4: -Where is unearned income reported on your tax form? You’ll report unearned income on the IRS Form 1040. You may have to include Schedule 1 with your return and report it there as well. The total from Schedule 1 is then transferred to your Form 1040 tax return.

Detailed explanation-5: -This unearned income is usually related to prior work or service. It includes, for example, private pensions, Social Security benefits, disability benefits, veterans’ benefits, workers’ compensation, railroad retirement annuities and unemployment insurance benefits.