N                                                                                INCOME has different meanings for different purposes, or as applies to        certain Internal Revenue Code Sections.  Below are some common definitions    from IRS publications:                                                                                                                                      For purposes of filing requirements:                                            GROSS INCOME - includes all income you receive in the form of money,          goods, property, and services that is not exempt from tax.  If you            are married and live in a community property state, half of any income        described by state law as community income may be considered to be yours.     If you are self-employed, your gross income includes the gross income         amount from line 7 of Schedule C.                                                                                                                           EARNED INCOME - is salaries, wages, tips, professional fees, and other        amounts received as pay for work actually done.                                                                                                             UNEARNED INCOME - This is income that does not meet the definition of         earned income.  It includes investment-type income such as interest,          dividends, and capital gains.  It also includes social security benefits,     pensions, and annuities.  Distributions of interest, dividends, capital       gains, and other unearned income from a trust are also unearned income        to a beneficiary of the trust.                                                                                      << PgDn for next page >>  Pg 1 of 3                                                                                 For purposes of claiming the earned income credit:                              EARNED INCOME - includes wages, salaries, tips, other employee                compensation, and net earnigns from self-employment.  Earned income also      includes strike benefits and any disability pay you report as wages.          Income exempt from self-employment tax as a result of the filing and          approval of Form 4363 (generally relating to the clergy) is earned            income if it is wages, salaries, tips, or other employee compensation.        This includes a housing allowance or the rental value of a parsonage          that you get as part of your pay for services as an employee.                 Income exempt from self-employment tax a result of the filing and             approval of Form 4020 (relating to members of certain religious faiths)       is not earned income.  Wages, salaries, tips or other employee compensa-      tion that is exempt from social security tax as a result of filing            Form 4029 is earned income.                                                                                                                                 Earned income DOES include voluntary salary deferrals (for example, 401(k)    plans).  The amount of SOCIAL SECURITY WAGES from form W2 will contain        these amounts; TAXABLE WAGES will not.                                        Earned income DOES NOT include pensions or annuities, social security         payments, workers' compensation, interest, dividends, or unemployment         compensation.                                                                                                       << PgDn for next page >> Pg 2 of 3                                                                                  For purposes of determining your IRA deduction:                                 COMPENSATION - includes wages, salaries, commissions, tips, professional      fees, bonuses, and other amounts you receive for providing personal           services.  Compensation also includes taxable alimony and separate            maintenance payments.                                                         If you are self-employed, compensation is your net earnings from your         trade or business (provided your personal services are a material             income-producing factor), reduced by your deduction for contributions         on your behalf to retirement plans and the deduction allowed for one-half     your self-employment taxes.  Compensation includes earnings from self-        employment that are not subject to self-employment because of your            religious beliefs.                                                                                                                                          Compensation does not include:                                                 * Earnings and profits from property, such as rental income, interest           income, and dividend income;                                                * Pension or annuity income;                                                  * Deferred compensation;                                                      * Foreign earned income and housing cost amounts that are excluded              from gross income;                                                          * Any other amounts that are excluded from income.                                                                 << End of File >>        Pg 3 of 3  