Which payment is classified as nontaxable income?

Child support payments are classified as nontaxable income because the IRS does not require recipients to report them as taxable income. This means that while the person receiving the child support does benefit financially from these payments, they are not subjected to income tax in the same way that wages or other forms of income are.

In contrast, Social Security benefits can sometimes be taxable, depending on the recipient's overall income level. Investment income, which includes interest, dividends, and capital gains, is generally taxable. Income from hobbies is also typically taxable if there is a profit, although hobby income is often reported differently than business income. Thus, child support payments stand out as a distinct category of nontaxable income in comparison to the other options presented.