Payment made to the parents for the wages of their child is taxable to the child. All unemployment benefits received from state or Federal agencies are taxable. Those received from a union are generally taxable to the extent they exceed dues paid in. Supplemental unemployment benefits paid from the employer are included as salary and wage payments. This is especially true when benefits are paid as a condition to participating in strike related activities.
Corporate dividends paid out of earnings and profits are subject to regular income tax.
In certain situations, these payments may receive special capital gain treatment. Dividends received via partnerships, S Corporations, and estates and trusts flow through to the individual tax return and retain their same character for Form 1040. That is, they are taxed as dividends. Included are earnings from deposits in credit unions, savings and loan associations, mutual dividends and others which might be called dividends by the institution but are in fact interest income. Unless the lump sum distribution is rolled over to a qualified plan within the required time frame, it is typically taxable under a set of complex rules.