How Income Gets Taxed

All income is presumed to be taxable. However, America's tax laws provide that income is taxed in a variety of ways. Here's how different types of income are taxed in the U.S., and how to take advantage of these differences in your tax planning.
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Quick Facts: Filing Taxes for Interest Income. No matter how insignificant the amount may seem, any interest income that you earn during the year is taxable. Sources of interest income may include money in a bank account, bonds, and loans you made to others if the interest charged exceeds $600. Exceptions do exist, like for U.S. Treasury and savings bonds, depending on whether they're at the federal or state level. Report it on Schedule B of Form 1040 if you have multiple sources of interest or if you have more than $1,500 in interest or dividends
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