What is generally considered taxable income?

Taxable income is defined as all income received by an individual in the form of cash or property that is not specifically exempted by tax law. This encompasses a broad range of income sources, including wages, salaries, dividends, rental income, and self-employment income. The phrase "not exempt from tax" is crucial because it indicates that while some types of income may be excluded from taxation, such as certain gifts or inheritances, most forms of income are indeed subject to tax.

The distinction in understanding taxable income lies in recognizing that it includes various streams rather than being limited to one specific category. This comprehensive definition ensures that taxpayers report all income effectively, promoting fairness and adherence to tax regulations.