Other Income: Form 1040 Line 21

What You Should Report on Line 21 of Your 1040

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“Other income” sounds like something we’d all love to have – extra financial streams into our households to do with as we see fit. In tax terms, this isn't far off. Other income is a catchall category for income sources that don't neatly fit anywhere else on a 1040 tax return. Think one-and-done payments made to you for one reason or another that are not likely to be repeated multiple times over the course of the tax year, if at all.

This income is reported on line 21 of Form 2040 -- and yes, it's taxable. 

Examples of Other Income

If you receive money or goods that are not included on a W-2 or most 1099s, you’ll probably have to report it as other income. Child support, Roth IRA distributions, gifts and inheritances are exceptions. Child support is tax-neutral – it’s neither deductible to the parent paying it nor reportable by the parent receiving it. Many retirement plan distributions are not taxed. Gifts may be taxed, but the donor is liable, not the recipient, and the federal government does not impose an inheritance tax.

Do not report self-employment income as other income, even if you don’t receive a 1099-MISC for payments you received. This income is reported on Schedule C, Profit or Loss From Business.

Some sources of income you might report as other income include:

  • Foreign earned income
  • Cash earned from odd jobs
  • Barter exchanges. Use the value of goods or services exchanged.
  • Prizes like lottery winnings
  • Canceled debts. You may receive Form 1099-Cs for these amounts, but they are nonetheless reported as other income
  • Dividends on insurance policies if they exceed the premiums you paid
  • Hobby income
  • Recaptures of deductions you erroneously claimed on past tax returns
  • Gambling winnings
  • Jury duty pay
  • Alaska Permanent Fund dividends. These may be reported on Form 1099-MISC, but the income should not go on Schedule C because it’s not self-employment income. Enter it as other income instead, or as unemployment compensation.
  • Reimbursements for previously deducted expenses. See IRS Publication 525, page 19, "Recoveries" 
  • The taxable portions of disaster relief payments
  • Distributions from a Coverdell education savings account (ESA) or a qualified tuition program (QTP).

How to Report Other Income

Other income goes on line 21 of your Form 1040 tax return. The IRS requires that you list “type and amount” here and enter the total. If you were paid $40 for performing jury duty, enter $40 and “jury duty.” If you have many sources of other income, you would enter the total and may have to attach a statement to your tax return to itemize what sources of income contributed to the total. 

You can’t report other income on Forms 1040EZ or 1040A. If you receive money from any of these sources, you must file the longer Form 1040 so you can report it.

NOTE: Tax laws change periodically, and you should consult with a tax professional for the most up-to-date advice. The information contained in this article is not intended as tax advice and is not a substitute for tax advice.