Most surprises, such as surprise parties, surprise gifts, and surprise reunions, are pleasant experiences. A surprise tax bill, though, is usually an unpleasant event. Many taxpayers receive income from sources they mistakenly believe are tax-free, so receiving a larger tax bill at the end of the year can be quite an unwelcome surprise. Here are a few income sources that you may be surprised to learn are taxable. 

Alimony

The IRS considers alimony to be a fully taxable source of income. Unlike child support, which is free from taxation, alimony is considered a deduction for the person who pays it and a taxable gain to the person who receives it. Since there is no way to have federal income taxes withheld from your alimony at the time of payment, you'll need to save up money and submit estimated taxes throughout the year to cover any additional tax liability.

Unemployment Benefits

Unemployment benefits are also completely taxable as far as the IRS is concerned. When you fill out your benefits application, you can request to have taxes withheld at the time of payment. Doing this will ensure that enough taxes are withheld to cover your tax at the end of the year. If you find that too little tax is being withheld from your benefits, you can adjust your withholding as needed.

Life Insurance Proceeds

According to the IRS, most life insurance proceeds are completely taxable. This can pose a serious hardship on a grieving family, particularly if the funds were used to pay necessary expenses after a loved one's death. The good news is that if you use the proceeds to cover out-of-pocket medical costs, you may be able to deduct the expenses on your return if you itemize your deductions. Claiming the medical costs can defray some of the additional tax you owe.

Prizes and Cash Winnings

Did you hit the lottery? Or did you win a great prize such as a free television? Both prizes and lottery winnings are taxable sources of income. In the case of a lottery prize, you can often request that the appropriate taxes be withheld right away, which will make sure that you cover your liability. If you win a physical prize, though, such as a free product or luxury item, you'll be taxed on the retail value of the item, which means you'll have to pay the appropriate taxes out of your own pocket.

Studying the tax code to find out which sources of income are taxable may be boring, but it's better than being caught off guard by your bill at IRS tax deadlines. If you prepare for these taxes during the year, you can save up the money you'll need to cover your additional payments to Uncle Sam, or else you may need to hire a criminal tax defense professional.