Which type of income is not considered taxable?

Imputed income is indeed not considered taxable in the traditional sense, making it the correct answer. Imputed income refers to the economic benefit that a person receives but does not involve an actual cash transaction. For example, if an employer provides an employee with a vehicle for personal use, the value of that use is considered imputed income. However, it is typically not subject to income tax because it does not represent cash or a cash-equivalent transaction received directly by the taxpayer.

In contrast, the other types of income listed—interest from savings accounts, wages from employment, and dividends from stocks—are considered taxable income. Interest earned from savings accounts generates actual earnings that are fully taxable; wages from employment represent compensation that employees on which income tax is due; and dividends from stocks are payments made to shareholders from corporate earnings, which are also subject to taxation. This distinction highlights the unique nature of imputed income in relation to taxable income.