Taxability of Income List

[Lion]

Have any of you already prepared a list of types of income ranked by their tax hits?

Self-employment Income -- income tax + self-employment tax
Retirement distributions prior to 59.5 yrs -- income tax + 10% penalty
Wages, interest, blah, blah -- income tax
Capital gains, capital gain dividends -- 15%
Tax-exempt investment earnings
Loan proceeds
Etc.
Etc.
(Probably need to flip this upside down.)

Started a list for a young widow living off early withdrawals from her IRA; she lost her job as well as her husband and is starting to consult, too. If one of you has a simple one-pager covering the taxability of different types of income with simple annotations, I'd love a copy. Why reinvent the wheel if one of you learned folks has already designed a list?

Thanks for any leads. I'm bouncing back and forth from too simple for a novice (her husband had handled everything financial, especially taxes) to getting too wordy explaining the exceptions and differences.

[solomon]

All income is taxable unless specifically excluded by law. The normal exclusions are §101 - §139B with a few repealed.

[OtisMozzetti]

Such a chart would end up almost misleadingly simple

Self-employment Income -- income tax + self-employment tax
Retirement distributions prior to 59.5 yrs -- income tax + 10% penalty
Wages, interest, blah, blah -- income tax
Capital gains, capital gain dividends -- 15%

Most of us tax professionals realize these really aren't quite as simple as "category of income: percentage".

"Self-employment income" is "self-employment revenues, net of allowable expenses".

"Wages: X%" is "Wages: X% plus whatever capital gain and qualified dividend percentage might be pushed out of the lower two tax brackets" For example, wages which fall into the 15% tax rate bracket may actually incur a rate of 15% + 15%/10% = 30%/25% if there are enough capital gains and/or qualified dividends getting pushed up into a higher rate bracket.

"Capital Gains" is "Net Long-Term Capital Gains other than Collectibles Gains, Unrecaptured 1250 Gains, etc....:15% or 0% during 2009 and 2010, plus possible impact upon the Alt. Min. Tax, and then ...X% and Y% and Z%...starting in 2011"

In order to be accurate, it might go on and on and on.

EA in California

[Lion]

Exactly

A too-simple list/comparison won't be enough, and when I start explaining, it gets too unwieldy. I'm just trying to educate a young widow on why she owes taxes for 2008 when she had very little income, but all of it from an IRA pre 59.5. And, how 2009 won't improve with the same IRA withdrawals plus consulting income in the five figures (working from home with few expenses). Her friends (and broker) told her she can take money from her IRA for hardships; she heard that she can take with no taxes. I'm trying to get her to consider a mix of sources which would include her taxable investments, especially capital gains and a few tax-exempt bonds, her home equity loan, etc., as well as early IRA withdrawals and consulting income. Also, trying to help her price her consulting. In addition, I have some young couples who have inherited IRAs. Just trying to outline a hierarchy of income sources with corresponding taxes, range of tax rates, etc....