Do you have to pay taxes on unearned income?

ANSWER

The BIDaWIZ Team's Answer:

It depends: unearned income is a very generic definition

that encompasses many types of passive income. Some types

of passive income are subject to taxation; such as, interest, and

dividends. Conversely, social security benefits are only taxable

if one's total taxable income exceeds a certain threshhold. The first

$2,500, of unemployment income, is exempt from federal taxation.

Life insurance proceeds are exempt from taxation; etc. So, the answer,

to the question, depends on the type of unearned income.