What is true about the expense reimbursement Meghan receives from her brother?

The expense reimbursement that Meghan receives from her brother is not considered taxable income because reimbursements for personal expenses typically do not fall under the definition of income for tax purposes. Generally, when individuals receive money to cover expenses they incurred on behalf of someone else, such as a family member, it is viewed as a repayment rather than income earned.

In the context of personal transactions, amounts received as reimbursement from friends or family do not have tax implications, unlike wages or payments for services, which are taxable. This is crucial in understanding the nature of personal reimbursements versus income-generating transactions.

While gifts between family members can sometimes raise different considerations, a reimbursement is specifically meant to cover costs rather than to provide personal gain, and as such remains non-taxable under IRS guidelines.