1. State and local taxes are generally deductible in computing federal taxable income. 2. Any amount beyond the original investment becomes taxable income to the beneficiary. 3. High unemployment translates into less taxable income and more spending on benefits. 4. Amounts withdrawn must be included in the taxable income of that year. 5. Last year, Mannesmann used losses carried forward to lower its taxable income. 6. Corporations must pay tax on their taxable income independently of their shareholders. 7. Misclassifying expenses would have depressed what the business reported as taxable income. 8. A : It's important to distinguish between taxable income and gross income. 9. Second, the ranges mentioned are for amounts that constitute your taxable income. 10. Financial assets generated about 12 percent of individuals' taxable income in 2002.