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1040x 2010 Instructions

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1040x 2010 Instructions

1040x 2010 instructions 1. 1040x 2010 instructions   Filing Information Table of Contents What's New Reminders Introduction Do I Have To File a Return?Individuals—In General Dependents Certain Children Under Age 19 or Full-Time Students Self-Employed Persons Aliens Who Should File Which Form Should I Use?Form 1040EZ Form 1040A Form 1040 Does My Return Have To Be on Paper?IRS e-file When Do I Have To File?Private delivery services. 1040x 2010 instructions Extensions of Time To File How Do I Prepare My Return?When Do I Report My Income and Expenses? Social Security Number (SSN) Presidential Election Campaign Fund Computations Attachments Third Party Designee Signatures Paid Preparer Refunds Amount You Owe Gift To Reduce Debt Held by the Public Name and Address Where Do I File? What Happens After I File?What Records Should I Keep? Why Keep Records? Kinds of Records to Keep Basic Records How Long to Keep Records Refund Information Interest on Refunds Change of Address What If I Made a Mistake?Amended Returns and Claims for Refund Penalties Identity Theft What's New Filing status for same-sex married couple. 1040x 2010 instructions   If you have a same-sex spouse whom you legally married in a state (or foreign country) that recognizes same-sex marriage, you and your spouse generally must use the married filing jointly or married filing separately filing status on your 2013 return, even if you and your spouse now live in a state (or foreign country) that does not recognize same-sex marriage. 1040x 2010 instructions See Publication 501 for more information. 1040x 2010 instructions Additional Medicare Tax. 1040x 2010 instructions  Beginning in 2013, a 0. 1040x 2010 instructions 9% Additional Medicare Tax applies to Medicare wages, Railroad Retirement Tax Act (RRTA) compensation, and self-employment income over a threshold amount based on your filing status. 1040x 2010 instructions For more information, see the Instructions for Form 1040, line 60, and Form 8959. 1040x 2010 instructions Net Investment Income Tax. 1040x 2010 instructions  Beginning in 2013, you may be subject to Net Investment Income Tax (NIIT). 1040x 2010 instructions NIIT is a 3. 1040x 2010 instructions 8% tax on the lesser of net investment income or the excess of your modified adjusted gross income over a threshold amount. 1040x 2010 instructions For more information, see the Instructions for Form 1040, line 60, and Form 8960. 1040x 2010 instructions Refundable credit for prior year minimum tax. 1040x 2010 instructions  The refundable portion of the credit for prior year minimum tax is no longer available. 1040x 2010 instructions Who must file. 1040x 2010 instructions  Generally, the amount of income you can receive before you must file a return has been increased. 1040x 2010 instructions See Table 1-1, Table 1-2, and Table 1-3 for the specific amounts. 1040x 2010 instructions Reminders File online. 1040x 2010 instructions  Rather than filing a return on paper, you may be able to file electronically using IRS e-file. 1040x 2010 instructions Create your own personal identification number (PIN) and file a completely paperless tax return. 1040x 2010 instructions For more information, see Does My Return Have To Be on Paper , later. 1040x 2010 instructions Change of address. 1040x 2010 instructions  If you change your address, you should notify the IRS. 1040x 2010 instructions You can use Form 8822 to notify the IRS of the change. 1040x 2010 instructions See Change of Address , later, under What Happens After I File. 1040x 2010 instructions Enter your social security number. 1040x 2010 instructions  You must enter your social security number (SSN) in the spaces provided on your tax return. 1040x 2010 instructions If you file a joint return, enter the SSNs in the same order as the names. 1040x 2010 instructions Direct deposit of refund. 1040x 2010 instructions  Instead of getting a paper check, you may be able to have your refund deposited directly into your account at a bank or other financial institution. 1040x 2010 instructions See Direct Deposit under Refunds, later. 1040x 2010 instructions If you choose direct deposit of your refund, you may be able to split the refund among two or three accounts. 1040x 2010 instructions Pay online or by phone. 1040x 2010 instructions  If you owe additional tax, you may be able to pay online or by phone. 1040x 2010 instructions See How To Pay , later. 1040x 2010 instructions Installment agreement. 1040x 2010 instructions  If you cannot pay the full amount due with your return, you may ask to make monthly installment payments. 1040x 2010 instructions See Installment Agreement , later, under Amount You Owe. 1040x 2010 instructions You may be able to apply online for a payment agreement if you owe federal tax, interest, and penalties. 1040x 2010 instructions Automatic 6-month extension. 1040x 2010 instructions  You can get an automatic 6-month extension to file your tax return if, no later than the date your return is due, you file Form 4868, Application for Automatic Extension of Time To File U. 1040x 2010 instructions S. 1040x 2010 instructions Individual Income Tax Return. 1040x 2010 instructions See Automatic Extension , later. 1040x 2010 instructions Service in combat zone. 1040x 2010 instructions  You are allowed extra time to take care of your tax matters if you are a member of the Armed Forces who served in a combat zone, or if you served in the combat zone in support of the Armed Forces. 1040x 2010 instructions See Individuals Serving in Combat Zone , later, under When Do I Have To File. 1040x 2010 instructions Adoption taxpayer identification number. 1040x 2010 instructions  If a child has been placed in your home for purposes of legal adoption and you will not be able to get a social security number for the child in time to file your return, you may be able to get an adoption taxpayer identification number (ATIN). 1040x 2010 instructions For more information, see Social Security Number (SSN) , later. 1040x 2010 instructions Taxpayer identification number for aliens. 1040x 2010 instructions  If you or your dependent is a nonresident or resident alien who does not have and is not eligible to get a social security number, file Form W-7, Application for IRS Individual Taxpayer Identification Number, with the IRS. 1040x 2010 instructions For more information, see Social Security Number (SSN) , later. 1040x 2010 instructions Frivolous tax submissions. 1040x 2010 instructions  The IRS has published a list of positions that are identified as frivolous. 1040x 2010 instructions The penalty for filing a frivolous tax return is $5,000. 1040x 2010 instructions Also, the $5,000 penalty will apply to other specified frivolous submissions. 1040x 2010 instructions For more information, see Civil Penalties , later. 1040x 2010 instructions Introduction This chapter discusses the following topics. 1040x 2010 instructions Whether you have to file a return. 1040x 2010 instructions Which form to use. 1040x 2010 instructions How to file electronically. 1040x 2010 instructions When, how, and where to file your return. 1040x 2010 instructions What happens if you pay too little or too much tax. 1040x 2010 instructions What records you should keep and how long you should keep them. 1040x 2010 instructions How you can change a return you have already filed. 1040x 2010 instructions Do I Have To File a Return? You must file a federal income tax return if you are a citizen or resident of the United States or a resident of Puerto Rico and you meet the filing requirements for any of the following categories that apply to you. 1040x 2010 instructions Individuals in general. 1040x 2010 instructions (There are special rules for surviving spouses, executors, administrators, legal representatives, U. 1040x 2010 instructions S. 1040x 2010 instructions citizens and residents living outside the United States, residents of Puerto Rico, and individuals with income from U. 1040x 2010 instructions S. 1040x 2010 instructions possessions. 1040x 2010 instructions ) Dependents. 1040x 2010 instructions Certain children under age 19 or full-time students. 1040x 2010 instructions Self-employed persons. 1040x 2010 instructions Aliens. 1040x 2010 instructions The filing requirements for each category are explained in this chapter. 1040x 2010 instructions The filing requirements apply even if you do not owe tax. 1040x 2010 instructions Even if you do not have to file a return, it may be to your advantage to do so. 1040x 2010 instructions See Who Should File, later. 1040x 2010 instructions File only one federal income tax return for the year regardless of how many jobs you had, how many Forms W-2 you received, or how many states you lived in during the year. 1040x 2010 instructions Do not file more than one original return for the same year, even if you have not gotten your refund or have not heard from the IRS since you filed. 1040x 2010 instructions Individuals—In General If you are a U. 1040x 2010 instructions S. 1040x 2010 instructions citizen or resident, whether you must file a return depends on three factors: Your gross income, Your filing status, and Your age. 1040x 2010 instructions To find out whether you must file, see Table 1-1, Table 1-2, and Table 1-3. 1040x 2010 instructions Even if no table shows that you must file, you may need to file to get money back. 1040x 2010 instructions (See Who Should File , later. 1040x 2010 instructions ) Gross income. 1040x 2010 instructions   This includes all income you receive in the form of money, goods, property, and services that is not exempt from tax. 1040x 2010 instructions It also includes income from sources outside the United States or from the sale of your main home (even if you can exclude all or part of it). 1040x 2010 instructions Include part of your social security benefits if: You were married, filing a separate return, and you lived with your spouse at any time during 2013; or Half of your social security benefits plus your other gross income and any tax-exempt interest is more than $25,000 ($32,000 if married filing jointly). 1040x 2010 instructions If either (1) or (2) applies, see the instructions for Form 1040 or 1040A, or Publication 915, Social Security and Equivalent Railroad Retirement Benefits, to figure the social security benefits you must include in gross income. 1040x 2010 instructions   Common types of income are discussed in Part Two of this publication. 1040x 2010 instructions Community income. 1040x 2010 instructions   If you are married and your permanent home is in a community property state, half of any income described by state law as community income may be considered yours. 1040x 2010 instructions This affects your federal taxes, including whether you must file if you do not file a joint return with your spouse. 1040x 2010 instructions See Publication 555, Community Property, for more information. 1040x 2010 instructions Nevada, Washington, and California domestic partners. 1040x 2010 instructions   A registered domestic partner in Nevada, Washington, or California generally must report half the combined community income of the individual and his or her domestic partner. 1040x 2010 instructions See Publication 555. 1040x 2010 instructions Self-employed individuals. 1040x 2010 instructions   If you are self-employed, your gross income includes the amount on line 7 of Schedule C (Form 1040), Profit or Loss From Business; line 1 of Schedule C-EZ (Form 1040), Net Profit From Business; and line 9 of Schedule F (Form 1040), Profit or Loss From Farming. 1040x 2010 instructions See Self-Employed Persons , later, for more information about your filing requirements. 1040x 2010 instructions    If you do not report all of your self-employment income, your social security benefits may be lower when you retire. 1040x 2010 instructions Filing status. 1040x 2010 instructions   Your filing status depends on whether you are single or married and on your family situation. 1040x 2010 instructions Your filing status is determined on the last day of your tax year, which is December 31 for most taxpayers. 1040x 2010 instructions See chapter 2 for an explanation of each filing status. 1040x 2010 instructions Age. 1040x 2010 instructions   If you are 65 or older at the end of the year, you generally can have a higher amount of gross income than other taxpayers before you must file. 1040x 2010 instructions See Table 1-1. 1040x 2010 instructions You are considered 65 on the day before your 65th birthday. 1040x 2010 instructions For example, if your 65th birthday is on January 1, 2014, you are considered 65 for 2013. 1040x 2010 instructions Table 1-1. 1040x 2010 instructions 2013 Filing Requirements for Most Taxpayers IF your filing status is. 1040x 2010 instructions . 1040x 2010 instructions . 1040x 2010 instructions AND at the end of 2013 you  were. 1040x 2010 instructions . 1040x 2010 instructions . 1040x 2010 instructions * THEN file a return if  your gross income  was at least. 1040x 2010 instructions . 1040x 2010 instructions . 1040x 2010 instructions ** single under 65 $10,000     65 or older $11,500   married filing jointly*** under 65 (both spouses) $20,000     65 or older (one spouse) $21,200     65 or older (both spouses) $22,400   married filing separately any age $3,900   head of household under 65 $12,850     65 or older $14,350   qualifying widow(er) with dependent child under 65 $16,100   65 or older $17,300   * If you were born on January 1, 1949, you are considered to be age 65 at the end of 2013. 1040x 2010 instructions ** Gross income means all income you received in the form of money, goods, property, and services that is not exempt from tax, including any income from sources outside the United States or from the sale of your main home (even if you can exclude part or all of it). 1040x 2010 instructions Do not include any social security benefits unless (a) you are married filing a separate return and you lived with your spouse at any time during 2013 or (b) one-half of your social security benefits plus your other gross income and any tax-exempt interest is more than $25,000 ($32,000 if married filing jointly). 1040x 2010 instructions If (a) or (b) applies, see the Instructions for Form 1040 or 1040A or Publication 915 to figure the taxable part of social security benefits you must include in gross income. 1040x 2010 instructions Gross income includes gains, but not losses, reported on Form 8949 or Schedule D. 1040x 2010 instructions Gross income from a business means, for example, the amount on Schedule C, line 7, or Schedule F, line 9. 1040x 2010 instructions But, in figuring gross income, do not reduce your income by any losses, including any loss on Schedule C, line 7, or Schedule F, line 9. 1040x 2010 instructions *** If you did not live with your spouse at the end of 2013 (or on the date your spouse died) and your gross income was at least $3,900, you must file a return regardless of your age. 1040x 2010 instructions Surviving Spouses, Executors, Administrators, and Legal Representatives You must file a final return for a decedent (a person who died) if both of the following are true. 1040x 2010 instructions You are the surviving spouse, executor, administrator, or legal representative. 1040x 2010 instructions The decedent met the filing requirements at the date of death. 1040x 2010 instructions For more information on rules for filing a decedent's final return, see Publication 559, Survivors, Executors, and Administrators. 1040x 2010 instructions U. 1040x 2010 instructions S. 1040x 2010 instructions Citizens and Resident Aliens Living Abroad To determine whether you must file a return, include in your gross income any income you received abroad, including any income you can exclude under the foreign earned income exclusion. 1040x 2010 instructions For information on special tax rules that may apply to you, see Publication 54, Tax Guide for U. 1040x 2010 instructions S. 1040x 2010 instructions Citizens and Resident Aliens Abroad. 1040x 2010 instructions It is available online and at most U. 1040x 2010 instructions S. 1040x 2010 instructions embassies and consulates. 1040x 2010 instructions See How To Get Tax Help in the back of this publication. 1040x 2010 instructions Residents of Puerto Rico If you are a U. 1040x 2010 instructions S. 1040x 2010 instructions citizen and also a bona fide resident of Puerto Rico, you generally must file a U. 1040x 2010 instructions S. 1040x 2010 instructions income tax return for any year in which you meet the income requirements. 1040x 2010 instructions This is in addition to any legal requirement you may have to file an income tax return with Puerto Rico. 1040x 2010 instructions If you are a bona fide resident of Puerto Rico for the entire year, your U. 1040x 2010 instructions S. 1040x 2010 instructions gross income does not include income from sources within Puerto Rico. 1040x 2010 instructions It does, however, include any income you received for your services as an employee of the United States or a U. 1040x 2010 instructions S. 1040x 2010 instructions agency. 1040x 2010 instructions If you receive income from Puerto Rican sources that is not subject to U. 1040x 2010 instructions S. 1040x 2010 instructions tax, you must reduce your standard deduction. 1040x 2010 instructions As a result, the amount of income you must have before you are required to file a U. 1040x 2010 instructions S. 1040x 2010 instructions income tax return is lower than the applicable amount in Table 1-1 or Table 1-2. 1040x 2010 instructions For more information, see Publication 570, Tax Guide for Individuals With Income From U. 1040x 2010 instructions S. 1040x 2010 instructions Possessions. 1040x 2010 instructions Individuals With Income From U. 1040x 2010 instructions S. 1040x 2010 instructions Possessions If you had income from Guam, the Commonwealth of the Northern Mariana Islands, American Samoa, or the U. 1040x 2010 instructions S. 1040x 2010 instructions Virgin Islands, special rules may apply when determining whether you must file a U. 1040x 2010 instructions S. 1040x 2010 instructions federal income tax return. 1040x 2010 instructions In addition, you may have to file a return with the individual island government. 1040x 2010 instructions See Publication 570 for more information. 1040x 2010 instructions Dependents If you are a dependent (one who meets the dependency tests in chapter 3), see Table 1-2 to find out whether you must file a return. 1040x 2010 instructions You also must file if your situation is described in Table 1-3. 1040x 2010 instructions Responsibility of parent. 1040x 2010 instructions   Generally, a child is responsible for filing his or her own tax return and for paying any tax on the return. 1040x 2010 instructions If a dependent child must file an income tax return but cannot file due to age or any other reason, then a parent, guardian, or other legally responsible person must file it for the child. 1040x 2010 instructions If the child cannot sign the return, the parent or guardian must sign the child's name followed by the words “By (your signature), parent for minor child. 1040x 2010 instructions ” Child's earnings. 1040x 2010 instructions   Amounts a child earns by performing services are included in his or her gross income and not the gross income of the parent. 1040x 2010 instructions This is true even if under local law the child's parent has the right to the earnings and may actually have received them. 1040x 2010 instructions But if the child does not pay the tax due on this income, the parent is liable for the tax. 1040x 2010 instructions Certain Children Under Age 19 or Full-Time Students If a child's only income is interest and dividends (including capital gain distributions and Alaska Permanent Fund dividends), the child was under age 19 at the end of 2013 or was a full-time student under age 24 at the end of 2013, and certain other conditions are met, a parent can elect to include the child's income on the parent's return. 1040x 2010 instructions If this election is made, the child does not have to file a return. 1040x 2010 instructions See Parent's Election To Report Child's Interest and Dividends in chapter 31. 1040x 2010 instructions Self-Employed Persons You are self-employed if you: Carry on a trade or business as a sole proprietor, Are an independent contractor, Are a member of a partnership, or Are in business for yourself in any other way. 1040x 2010 instructions Self-employment can include work in addition to your regular full-time business activities, such as certain part-time work you do at home or in addition to your regular job. 1040x 2010 instructions You must file a return if your gross income is at least as much as the filing requirement amount for your filing status and age (shown in Table 1-1). 1040x 2010 instructions Also, you must file Form 1040 and Schedule SE (Form 1040), Self-Employment Tax, if: Your net earnings from self-employment (excluding church employee income) were $400 or more, or You had church employee income of $108. 1040x 2010 instructions 28 or more. 1040x 2010 instructions (See Table 1-3. 1040x 2010 instructions ) Use Schedule SE (Form 1040) to figure your self-employment tax. 1040x 2010 instructions Self-employment tax is comparable to the social security and Medicare tax withheld from an employee's wages. 1040x 2010 instructions For more information about this tax, see Publication 334, Tax Guide for Small Business. 1040x 2010 instructions Employees of foreign governments or international organizations. 1040x 2010 instructions   If you are a U. 1040x 2010 instructions S. 1040x 2010 instructions citizen who works in the United States for an international organization, a foreign government, or a wholly owned instrumentality of a foreign government, and your employer is not required to withhold social security and Medicare taxes from your wages, you must include your earnings from services performed in the United States when figuring your net earnings from self-employment. 1040x 2010 instructions Ministers. 1040x 2010 instructions   You must include income from services you performed as a minister when figuring your net earnings from self-employment, unless you have an exemption from self-employment tax. 1040x 2010 instructions This also applies to Christian Science practitioners and members of a religious order who have not taken a vow of poverty. 1040x 2010 instructions For more information, see Publication 517, Social Security and Other Information for Members of the Clergy and Religious Workers. 1040x 2010 instructions Table 1-2. 1040x 2010 instructions 2013 Filing Requirements for Dependents See chapter 3 to find out if someone can claim you as a dependent. 1040x 2010 instructions If your parents (or someone else) can claim you as a dependent, use this table to see if you must file a return. 1040x 2010 instructions (See Table 1-3 for other situations when you must file. 1040x 2010 instructions ) In this table, earned income includes salaries, wages, tips, and professional fees. 1040x 2010 instructions It also includes taxable scholarship and fellowship grants. 1040x 2010 instructions (See Scholarships and fellowships in chapter 12. 1040x 2010 instructions ) Unearned income includes investment-type income such as taxable interest, ordinary dividends, and capital gain distributions. 1040x 2010 instructions It also includes unemployment compensation, taxable social security benefits, pensions, annuities, cancellation of debt, and distributions of unearned income from a trust. 1040x 2010 instructions Gross income is the total of your earned and unearned income. 1040x 2010 instructions   Single dependents—Were you either age 65 or older or blind? □ No. 1040x 2010 instructions You must file a return if any of the following apply. 1040x 2010 instructions     • Your unearned income was more than $1,000. 1040x 2010 instructions     • Your earned income was more than $6,100. 1040x 2010 instructions     • Your gross income was more than the larger of:       • $1,000, or       • Your earned income (up to $5,750) plus $350. 1040x 2010 instructions □ Yes. 1040x 2010 instructions You must file a return if any of the following apply. 1040x 2010 instructions     • Your unearned income was more than $2,500 ($4,000 if 65 or older and blind). 1040x 2010 instructions     • Your earned income was more than $7,600 ($9,100 if 65 or older and blind). 1040x 2010 instructions     • Your gross income was more than the larger of:       • $2,500 ($4,000 if 65 or older and blind), or       • Your earned income (up to $5,750) plus $1,850 ($3,350 if 65 or older and blind). 1040x 2010 instructions Married dependents—Were you either age 65 or older or blind? □ No. 1040x 2010 instructions You must file a return if any of the following apply. 1040x 2010 instructions     • Your unearned income was more than $1,000. 1040x 2010 instructions     • Your earned income was more than $6,100. 1040x 2010 instructions     • Your gross income was at least $5 and your spouse files a separate return and itemizes deductions. 1040x 2010 instructions     • Your gross income was more than the larger of:       • $1,000, or       • Your earned income (up to $5,750) plus $350. 1040x 2010 instructions □ Yes. 1040x 2010 instructions You must file a return if any of the following apply. 1040x 2010 instructions     • Your unearned income was more than $2,200 ($3,400 if 65 or older and blind). 1040x 2010 instructions     • Your earned income was more than $7,300 ($8,500 if 65 or older and blind). 1040x 2010 instructions     • Your gross income was at least $5 and your spouse files a separate return and itemizes deductions. 1040x 2010 instructions     • Your gross income was more than the larger of:       • $2,200 ($3,400 if 65 or older and blind), or       • Your earned income (up to $5,750) plus $1,550 ($2,750 if 65 or older and blind). 1040x 2010 instructions Aliens Your status as an alien—resident, nonresident, or dual-status—determines whether and how you must file an income tax return. 1040x 2010 instructions The rules used to determine your alien status are discussed in Publication 519, U. 1040x 2010 instructions S. 1040x 2010 instructions Tax Guide for Aliens. 1040x 2010 instructions Resident alien. 1040x 2010 instructions   If you are a resident alien for the entire year, you must file a tax return following the same rules that apply to U. 1040x 2010 instructions S. 1040x 2010 instructions citizens. 1040x 2010 instructions Use the forms discussed in this publication. 1040x 2010 instructions Nonresident alien. 1040x 2010 instructions   If you are a nonresident alien, the rules and tax forms that apply to you are different from those that apply to U. 1040x 2010 instructions S. 1040x 2010 instructions citizens and resident aliens. 1040x 2010 instructions See Publication 519 to find out if U. 1040x 2010 instructions S. 1040x 2010 instructions income tax laws apply to you and which forms you should file. 1040x 2010 instructions Dual-status taxpayer. 1040x 2010 instructions   If you are a resident alien for part of the tax year and a nonresident alien for the rest of the year, you are a dual-status taxpayer. 1040x 2010 instructions Different rules apply for each part of the year. 1040x 2010 instructions For information on dual-status taxpayers, see Publication 519. 1040x 2010 instructions Table 1-3. 1040x 2010 instructions Other Situations When You Must File a 2013 Return You must file a return if any of the four conditions below apply for 2013. 1040x 2010 instructions 1. 1040x 2010 instructions   You owe any special taxes, including any of the following. 1040x 2010 instructions   a. 1040x 2010 instructions Alternative minimum tax. 1040x 2010 instructions   b. 1040x 2010 instructions Additional tax on a qualified plan, including an individual retirement arrangement (IRA), or other tax-favored account. 1040x 2010 instructions But if you are filing a return only because you owe this tax, you can file Form 5329 by itself. 1040x 2010 instructions   c. 1040x 2010 instructions Household employment taxes. 1040x 2010 instructions But if you are filing a return only because you owe this tax, you can file Schedule H by itself. 1040x 2010 instructions   d. 1040x 2010 instructions Social security and Medicare tax on tips you did not report to your employer or on wages you received from an employer who did not withhold these taxes. 1040x 2010 instructions   e. 1040x 2010 instructions Recapture of first-time homebuyer credit. 1040x 2010 instructions   f. 1040x 2010 instructions Write-in taxes, including uncollected social security and Medicare or RRTA tax on tips you reported to your employer or on group-term life insurance and additional taxes on health savings accounts. 1040x 2010 instructions   g. 1040x 2010 instructions Recapture taxes. 1040x 2010 instructions 2. 1040x 2010 instructions   You (or your spouse, if filing jointly) received HSA, Archer MSA, or Medicare Advantage MSA distributions. 1040x 2010 instructions 3. 1040x 2010 instructions   You had net earnings from self-employment of at least $400. 1040x 2010 instructions 4. 1040x 2010 instructions   You had wages of $108. 1040x 2010 instructions 28 or more from a church or qualified church-controlled organization that is exempt from employer social security and Medicare taxes. 1040x 2010 instructions Who Should File Even if you do not have to file, you should file a federal income tax return to get money back if any of the following conditions apply. 1040x 2010 instructions You had federal income tax withheld or made estimated tax payments. 1040x 2010 instructions You qualify for the earned income credit. 1040x 2010 instructions See chapter 36 for more information. 1040x 2010 instructions You qualify for the additional child tax credit. 1040x 2010 instructions See chapter 34 for more information. 1040x 2010 instructions You qualify for the health coverage tax credit. 1040x 2010 instructions See chapter 37 for more information. 1040x 2010 instructions You qualify for the American opportunity credit. 1040x 2010 instructions See chapter 35 for more information. 1040x 2010 instructions You qualify for the credit for federal tax on fuels. 1040x 2010 instructions See chapter 37 for more information. 1040x 2010 instructions Which Form Should I Use? You must use one of three forms to file your return: Form 1040EZ, Form 1040A, or Form 1040. 1040x 2010 instructions (But also see Does My Return Have To Be on Paper , later. 1040x 2010 instructions ) See the discussion under Form 1040 for when you must use that form. 1040x 2010 instructions Form 1040EZ Form 1040EZ is the simplest form to use. 1040x 2010 instructions You can use Form 1040EZ if all of the following apply. 1040x 2010 instructions    Your filing status is single or married filing jointly. 1040x 2010 instructions If you were a nonresident alien at any time in 2013, your filing status must be married filing jointly. 1040x 2010 instructions You (and your spouse if married filing a joint return) were under age 65 and not blind at the end of 2013. 1040x 2010 instructions If you were born on January 1, 1949, you are considered to be age 65 at the end of 2013. 1040x 2010 instructions You do not claim any dependents. 1040x 2010 instructions Your taxable income is less than $100,000. 1040x 2010 instructions Your income is only from wages, salaries, tips, unemployment compensation, Alaska Permanent Fund dividends, taxable scholarship and fellowship grants, and taxable interest of $1,500 or less. 1040x 2010 instructions You do not claim any adjustments to income, such as a deduction for IRA contributions or student loan interest. 1040x 2010 instructions You do not claim any credits other than the earned income credit. 1040x 2010 instructions You do not owe any household employment taxes on wages you paid to a household employee. 1040x 2010 instructions If you earned tips, they are included in boxes 5 and 7 of your Form W-2. 1040x 2010 instructions You are not a debtor in a chapter 11 bankruptcy case filed after October 16, 2005. 1040x 2010 instructions   You must meet all of these requirements to use Form 1040EZ. 1040x 2010 instructions If you do not, you must use Form 1040A or Form 1040. 1040x 2010 instructions Figuring tax. 1040x 2010 instructions   On Form 1040EZ, you can use only the tax table to figure your income tax. 1040x 2010 instructions You cannot use Form 1040EZ to report any other tax. 1040x 2010 instructions Form 1040A If you do not qualify to use Form 1040EZ, you may be able to use Form 1040A. 1040x 2010 instructions You can use Form 1040A if all of the following apply. 1040x 2010 instructions    Your income is only from: Wages, salaries, and tips, Interest, Ordinary dividends (including Alaska Permanent Fund dividends), Capital gain distributions, IRA distributions, Pensions and annuities, Unemployment compensation, Taxable social security and railroad retirement benefits, and Taxable scholarship and fellowship grants. 1040x 2010 instructions If you receive a capital gain distribution that includes unrecaptured section 1250 gain, section 1202 gain, or collectibles (28%) gain, you cannot use Form 1040A. 1040x 2010 instructions You must use Form 1040. 1040x 2010 instructions Your taxable income is less than $100,000. 1040x 2010 instructions Your adjustments to income are for only the following items. 1040x 2010 instructions Educator expenses. 1040x 2010 instructions IRA deduction. 1040x 2010 instructions Student loan interest deduction. 1040x 2010 instructions Tuition and fees. 1040x 2010 instructions You do not itemize your deductions. 1040x 2010 instructions You claim only the following tax credits. 1040x 2010 instructions The credit for child and dependent care expenses. 1040x 2010 instructions (See chapter 32. 1040x 2010 instructions ) The credit for the elderly or the disabled. 1040x 2010 instructions (See chapter 33. 1040x 2010 instructions ) The education credits. 1040x 2010 instructions (See chapter 35. 1040x 2010 instructions ) The retirement savings contribution credit. 1040x 2010 instructions (See chapter 37. 1040x 2010 instructions ) The child tax credit. 1040x 2010 instructions (See chapter 34. 1040x 2010 instructions ) The earned income credit. 1040x 2010 instructions (See chapter 36. 1040x 2010 instructions ) The additional child tax credit. 1040x 2010 instructions (See chapter 34. 1040x 2010 instructions ) You did not have an alternative minimum tax adjustment on stock you acquired from the exercise of an incentive stock option. 1040x 2010 instructions (See Publication 525, Taxable and Nontaxable Income. 1040x 2010 instructions )   You can also use Form 1040A if you received employer-provided dependent care benefits or if you owe tax from the recapture of an education credit or the alternative minimum tax. 1040x 2010 instructions   You must meet all these requirements to use Form 1040A. 1040x 2010 instructions If you do not, you must use Form 1040. 1040x 2010 instructions Form 1040 If you cannot use Form 1040EZ or Form 1040A, you must use Form 1040. 1040x 2010 instructions You can use Form 1040 to report all types of income, deductions, and credits. 1040x 2010 instructions You may pay less tax by filing Form 1040 because you can take itemized deductions, some adjustments to income, and credits you cannot take on Form 1040A or Form 1040EZ. 1040x 2010 instructions You must use Form 1040 if any of the following apply. 1040x 2010 instructions    Your taxable income is $100,000 or more. 1040x 2010 instructions You itemize your deductions on Schedule A. 1040x 2010 instructions You had income that cannot be reported on Form 1040EZ or Form 1040A, including tax-exempt interest from private activity bonds issued after August 7, 1986. 1040x 2010 instructions You claim any adjustments to gross income other than the adjustments listed earlier under Form 1040A. 1040x 2010 instructions Your Form W-2, box 12, shows uncollected employee tax (social security and Medicare tax) on tips (see chapter 6) or group-term life insurance (see chapter 5). 1040x 2010 instructions You received $20 or more in tips in any 1 month and did not report all of them to your employer. 1040x 2010 instructions (See chapter 6. 1040x 2010 instructions ) You were a bona fide resident of Puerto Rico and exclude income from sources in Puerto Rico. 1040x 2010 instructions You claim any credits other than the credits listed earlier under Form 1040A. 1040x 2010 instructions You owe the excise tax on insider stock compensation from an expatriated corporation. 1040x 2010 instructions Your Form W-2 shows an amount in box 12 with a code Z. 1040x 2010 instructions You had a qualified health savings account funding distribution from your IRA. 1040x 2010 instructions You are an employee and your employer did not withhold social security and Medicare tax. 1040x 2010 instructions You have to file other forms with your return to report certain exclusions, taxes, or transactions, such as Form 8959 or Form 8960. 1040x 2010 instructions You are a debtor in a bankruptcy case filed after October 16, 2005. 1040x 2010 instructions You must repay the first-time homebuyer credit. 1040x 2010 instructions You have adjusted gross income of more than $150,000 and must reduce the dollar amount of your exemptions. 1040x 2010 instructions Does My Return Have To Be on Paper? You may be able to file a paperless return using IRS e-file (electronic filing). 1040x 2010 instructions If your 2013 adjusted gross income (AGI) is less than a certain amount, you are eligible for Free File. 1040x 2010 instructions See your tax return instructions for details. 1040x 2010 instructions If you do not qualify for Free File, then you should check out IRS. 1040x 2010 instructions gov for low-cost e-file options or Free File Fillable Forms. 1040x 2010 instructions IRS e-file Table 1-4 lists the benefits of IRS e-file. 1040x 2010 instructions IRS e-file uses automation to replace most of the manual steps needed to process paper returns. 1040x 2010 instructions As a result, the processing of e-file returns is faster and more accurate than the processing of paper returns. 1040x 2010 instructions However, as with a paper return, you are responsible for making sure your return contains accurate information and is filed on time. 1040x 2010 instructions Using e-file does not affect your chances of an IRS examination of your return. 1040x 2010 instructions Free File Fillable Forms. 1040x 2010 instructions   If you do not need the help of a tax preparer, then Free File Fillable Forms may be for you. 1040x 2010 instructions These forms: Do not have an income requirement so everyone is eligible, Are easy to use, Perform basic math calculations, Are available only at IRS. 1040x 2010 instructions gov, and Apply only to a federal tax return. 1040x 2010 instructions Electronic return signatures. 1040x 2010 instructions   To file your return electronically, you must sign the return electronically using a personal identification number (PIN). 1040x 2010 instructions If you are filing online, you must use a Self-Select PIN. 1040x 2010 instructions If you are filing electronically using a tax practitioner, you can use a Self-Select PIN or a Practitioner PIN. 1040x 2010 instructions Self-Select PIN. 1040x 2010 instructions   The Self-Select PIN method allows you to create your own PIN. 1040x 2010 instructions If you are married filing jointly, you and your spouse will each need to create a PIN and enter these PINs as your electronic signatures. 1040x 2010 instructions   A PIN is any combination of five digits you choose except five zeros. 1040x 2010 instructions If you use a PIN, there is nothing to sign and nothing to mail—not even your Forms W-2. 1040x 2010 instructions   To verify your identity, you will be prompted to enter your adjusted gross income (AGI) from your originally filed 2012 federal income tax return, if applicable. 1040x 2010 instructions Do not use your AGI from an amended return (Form 1040X) or a math error correction made by the IRS. 1040x 2010 instructions AGI is the amount shown on your 2012 Form 1040, line 38; Form 1040A, line 22; or Form 1040EZ, line 4. 1040x 2010 instructions If you do not have your 2012 income tax return, you can quickly request a transcript by using our automated self-service tool. 1040x 2010 instructions Visit us at IRS. 1040x 2010 instructions gov and click on Order a Return or Account Transcript or call 1-800-908-9946 to get a free transcript of your return. 1040x 2010 instructions (If you filed electronically last year, you may use your prior year PIN to verify your identity instead of your prior year AGI. 1040x 2010 instructions The prior year PIN is the five digit PIN you used to electronically sign your 2012 return. 1040x 2010 instructions ) You will also be prompted to enter your date of birth. 1040x 2010 instructions Table 1-4. 1040x 2010 instructions Benefits of IRS e-file • Free File allows qualified taxpayers to prepare and e-file their own tax returns for free. 1040x 2010 instructions • Free File is available in English and Spanish. 1040x 2010 instructions • Free File is available online 24 hours a day, 7 days a week. 1040x 2010 instructions • Get your refund faster by e-filing using Direct Deposit. 1040x 2010 instructions • Sign electronically with a secure self-selected PIN and file a completely paperless return. 1040x 2010 instructions • Receive an acknowledgement that your return was received and accepted. 1040x 2010 instructions • If you owe, you can e-file and pay electronically either online or by phone, using your bank account or a credit or debit card. 1040x 2010 instructions You can also file a return early and pay the amount you owe by the due date of your return. 1040x 2010 instructions • Save time by preparing and e-filing federal and state returns together. 1040x 2010 instructions • IRS computers quickly and automatically check for errors or other missing information. 1040x 2010 instructions • Help the environment, use less paper, and save taxpayer money—it costs less to process an e-filed return than a paper return. 1040x 2010 instructions You cannot use the Self-Select PIN method if you are a first-time filer under age 16 at the end of 2013. 1040x 2010 instructions If you cannot locate your prior year AGI or prior year PIN, use the Electronic Filing PIN Request. 1040x 2010 instructions This can be found at IRS. 1040x 2010 instructions gov. 1040x 2010 instructions Click on Request an Electronic Filing PIN. 1040x 2010 instructions Or you can call 1-866-704-7388. 1040x 2010 instructions Practitioner PIN. 1040x 2010 instructions   The Practitioner PIN method allows you to authorize your tax practitioner to enter or generate your PIN. 1040x 2010 instructions The practitioner can provide you with details. 1040x 2010 instructions Form 8453. 1040x 2010 instructions   You must send in a paper Form 8453 if you have to attach certain forms or other documents that cannot be electronically filed. 1040x 2010 instructions For details, see Form 8453. 1040x 2010 instructions For more details, visit www. 1040x 2010 instructions irs. 1040x 2010 instructions gov/efile and click on “ Individuals. 1040x 2010 instructions ” Identity Protection PIN. 1040x 2010 instructions   If the IRS gave you an identity protection personal identification number (PIN) because you were a victim of identity theft, enter it in the spaces provided on your tax form. 1040x 2010 instructions If the IRS has not given you this type of number, leave these spaces blank. 1040x 2010 instructions For more information, see the Instructions for Form 1040A or Form 1040. 1040x 2010 instructions Power of attorney. 1040x 2010 instructions   If an agent is signing your return for you, a power of attorney (POA) must be filed. 1040x 2010 instructions Attach the POA to Form 8453 and file it using that form's instructions. 1040x 2010 instructions See Signatures , later, for more information on POAs. 1040x 2010 instructions State returns. 1040x 2010 instructions   In most states, you can file an electronic state return simultaneously with your federal return. 1040x 2010 instructions For more information, check with your local IRS office, state tax agency, tax professional, or the IRS website at  www. 1040x 2010 instructions irs. 1040x 2010 instructions gov/efile. 1040x 2010 instructions Refunds. 1040x 2010 instructions   You can have a refund check mailed to you, or you can have your refund deposited directly to your checking or savings account or split among two or three accounts. 1040x 2010 instructions With e-file, your refund will be issued faster than if you filed on paper. 1040x 2010 instructions   As with a paper return, you may not get all of your refund if you owe certain past-due amounts, such as federal tax, state income tax, state unemployment compensation debts, child support, spousal support, or certain other federal nontax debts, such as student loans. 1040x 2010 instructions See Offset against debts under Refunds, later. 1040x 2010 instructions Refund inquiries. 1040x 2010 instructions   Information about your return will generally be available within 24 hours after the IRS receives your e-filed return. 1040x 2010 instructions See Refund Information , later. 1040x 2010 instructions Amount you owe. 1040x 2010 instructions   To avoid late-payment penalties and interest, pay your taxes in full by April 15, 2014. 1040x 2010 instructions See How To Pay , later, for information on how to pay the amount you owe. 1040x 2010 instructions Using Your Personal Computer You can file your tax return in a fast, easy, and convenient way using your personal computer. 1040x 2010 instructions A computer with Internet access and tax preparation software are all you need. 1040x 2010 instructions Best of all, you can e-file from the comfort of your home 24 hours a day, 7 days a week. 1040x 2010 instructions IRS approved tax preparation software is available for online use on the Internet, for download from the Internet, and in retail stores. 1040x 2010 instructions For information, visit www. 1040x 2010 instructions irs. 1040x 2010 instructions gov/efile. 1040x 2010 instructions Through Employers and Financial Institutions Some businesses offer free e-file to their employees, members, or customers. 1040x 2010 instructions Others offer it for a fee. 1040x 2010 instructions Ask your employer or financial institution if they offer IRS e-file as an employee, member, or customer benefit. 1040x 2010 instructions Free Help With Your Return Free help in preparing your return is available nationwide from IRS-trained volunteers. 1040x 2010 instructions The Volunteer Income Tax Assistance (VITA) program is designed to help low to moderate income taxpayers and the Tax Counseling for the Elderly (TCE) program is designed to assist taxpayers age 60 or older with their tax returns. 1040x 2010 instructions Many VITA sites offer free electronic filing and all volunteers will let you know about the credits and deductions you may be entitled to claim. 1040x 2010 instructions To find a site near you, call 1-800-906-9887. 1040x 2010 instructions Or to find the nearest AARP TaxAide site, visit AARP's website at www. 1040x 2010 instructions aarp. 1040x 2010 instructions org/taxaide or call 1-888-227-7669. 1040x 2010 instructions For more information on these programs, go to IRS. 1040x 2010 instructions gov and enter keyword “VITA” in the search box. 1040x 2010 instructions Using a Tax Professional Many tax professionals electronically file tax returns for their clients. 1040x 2010 instructions You may personally enter your PIN or complete Form 8879, IRS e-file Signature Authorization, to authorize the tax professional to enter your PIN on your return. 1040x 2010 instructions Note. 1040x 2010 instructions Tax professionals may charge a fee for IRS e-file. 1040x 2010 instructions Fees can vary depending on the professional and the specific services rendered. 1040x 2010 instructions When Do I Have To File? April 15, 2014, is the due date for filing your 2013 income tax return if you use the calendar year. 1040x 2010 instructions For a quick view of due dates for filing a return with or without an extension of time to file (discussed later), see Table 1-5. 1040x 2010 instructions Table 1-5. 1040x 2010 instructions When To File Your 2013 Return For U. 1040x 2010 instructions S. 1040x 2010 instructions citizens and residents who file returns on a calendar year. 1040x 2010 instructions   For Most Taxpayers For Certain Taxpayers Outside the U. 1040x 2010 instructions S. 1040x 2010 instructions No extension requested April 15, 2014 June 16, 2014 Automatic extension October 15, 2014 October 15, 2014 If you use a fiscal year (a year ending on the last day of any month except December, or a 52-53-week year), your income tax return is due by the 15th day of the 4th month after the close of your fiscal year. 1040x 2010 instructions When the due date for doing any act for tax purposes—filing a return, paying taxes, etc. 1040x 2010 instructions —falls on a Saturday, Sunday, or legal holiday, the due date is delayed until the next business day. 1040x 2010 instructions Filing paper returns on time. 1040x 2010 instructions   Your paper return is filed on time if it is mailed in an envelope that is properly addressed, has enough postage, and is postmarked by the due date. 1040x 2010 instructions If you send your return by registered mail, the date of the registration is the postmark date. 1040x 2010 instructions The registration is evidence that the return was delivered. 1040x 2010 instructions If you send a return by certified mail and have your receipt postmarked by a postal employee, the date on the receipt is the postmark date. 1040x 2010 instructions The postmarked certified mail receipt is evidence that the return was delivered. 1040x 2010 instructions Private delivery services. 1040x 2010 instructions   If you use a private delivery service designated by the IRS to send your return, the postmark date generally is the date the private delivery service records in its database or marks on the mailing label. 1040x 2010 instructions The private delivery service can tell you how to get written proof of this date. 1040x 2010 instructions   For the IRS mailing address to use if you are using a private delivery service, go to IRS. 1040x 2010 instructions gov and enter “private delivery service” in the search box. 1040x 2010 instructions   The following are designated private delivery services. 1040x 2010 instructions DHL Express (DHL): Same Day Service. 1040x 2010 instructions Federal Express (FedEx): FedEx Priority Overnight, FedEx Standard Overnight, FedEx 2Day, FedEx International Priority, and FedEx International First. 1040x 2010 instructions United Parcel Service (UPS): UPS Next Day Air, UPS Next Day Air Saver, UPS 2nd Day Air, UPS 2nd Day Air A. 1040x 2010 instructions M. 1040x 2010 instructions , UPS Worldwide Express Plus, and UPS Worldwide Express. 1040x 2010 instructions Filing electronic returns on time. 1040x 2010 instructions   If you use IRS e-file, your return is considered filed on time if the authorized electronic return transmitter postmarks the transmission by the due date. 1040x 2010 instructions An authorized electronic return transmitter is a participant in the IRS e-file program that transmits electronic tax return information directly to the IRS. 1040x 2010 instructions   The electronic postmark is a record of when the authorized electronic return transmitter received the transmission of your electronically filed return on its host system. 1040x 2010 instructions The date and time in your time zone controls whether your electronically filed return is timely. 1040x 2010 instructions Filing late. 1040x 2010 instructions   If you do not file your return by the due date, you may have to pay a failure-to-file penalty and interest. 1040x 2010 instructions For more information, see Penalties , later. 1040x 2010 instructions Also see Interest under Amount You Owe. 1040x 2010 instructions   If you were due a refund but you did not file a return, you generally must file within 3 years from the date the return was due (including extensions) to get that refund. 1040x 2010 instructions Nonresident alien. 1040x 2010 instructions    If you are a nonresident alien and earn wages subject to U. 1040x 2010 instructions S. 1040x 2010 instructions income tax withholding, your 2013 U. 1040x 2010 instructions S. 1040x 2010 instructions income tax return (Form 1040NR or Form 1040NR-EZ) is due by: April 15, 2014, if you use a calendar year, or The 15th day of the 4th month after the end of your fiscal year if you use a fiscal year. 1040x 2010 instructions   If you do not earn wages subject to U. 1040x 2010 instructions S. 1040x 2010 instructions income tax withholding, your return is due by: June 16, 2014, if you use a calendar year, or The 15th day of the 6th month after the end of your fiscal year, if you use a fiscal year. 1040x 2010 instructions See Publication 519 for more filing information. 1040x 2010 instructions Filing for a decedent. 1040x 2010 instructions   If you must file a final income tax return for a taxpayer who died during the year (a decedent), the return is due by the 15th day of the 4th month after the end of the decedent's normal tax year. 1040x 2010 instructions See Publication 559. 1040x 2010 instructions Extensions of Time To File You may be able to get an extension of time to file your return. 1040x 2010 instructions There are three types of situations where you may qualify for an extension: Automatic extensions, You are outside the United States, or You are serving in a combat zone. 1040x 2010 instructions Automatic Extension If you cannot file your 2013 return by the due date, you may be able to get an automatic 6-month extension of time to file. 1040x 2010 instructions Example. 1040x 2010 instructions If your return is due on April 15, 2014, you will have until October 15, 2014, to file. 1040x 2010 instructions If you do not pay the tax due by the regular due date (generally, April 15), you will owe interest. 1040x 2010 instructions You may also be charged penalties, discussed later. 1040x 2010 instructions How to get the automatic extension. 1040x 2010 instructions   You can get the automatic extension by: Using IRS e-file (electronic filing), or Filing a paper form. 1040x 2010 instructions E-file options. 1040x 2010 instructions   There are two ways you can use e-file to get an extension of time to file. 1040x 2010 instructions Complete Form 4868, Application for Automatic Extension of Time To File U. 1040x 2010 instructions S. 1040x 2010 instructions Individual Income Tax Return, to use as a worksheet. 1040x 2010 instructions If you think you may owe tax when you file your return, use Part II of the form to estimate your balance due. 1040x 2010 instructions If you e-file Form 4868 to the IRS, do not also send a paper Form 4868. 1040x 2010 instructions E-file using your personal computer or a tax professional. 1040x 2010 instructions    You can use a tax software package with your personal computer or a tax professional to file Form 4868 electronically. 1040x 2010 instructions You will need to provide certain information from your tax return for 2012. 1040x 2010 instructions If you wish to make a payment by direct transfer from your bank account, see Pay online , under How To Pay, later in this chapter. 1040x 2010 instructions E-file and pay by credit or debit card or by direct transfer from your bank account. 1040x 2010 instructions   You can get an extension by paying part or all of your estimate of tax due by using a credit or debit card or by direct transfer from your bank account. 1040x 2010 instructions You can do this by phone or over the Internet. 1040x 2010 instructions You do not file Form 4868. 1040x 2010 instructions See Pay online , under How To Pay, later in this chapter. 1040x 2010 instructions Filing a paper Form 4868. 1040x 2010 instructions   You can get an extension of time to file by filing a paper Form 4868. 1040x 2010 instructions Mail it to the address shown in the form instructions. 1040x 2010 instructions   If you want to make a payment with the form, make your check or money order payable to “United States Treasury. 1040x 2010 instructions ” Write your SSN, daytime phone number, and “2013 Form 4868” on your check or money order. 1040x 2010 instructions When to file. 1040x 2010 instructions   You must request the automatic extension by the due date for your return. 1040x 2010 instructions You can file your return any time before the 6-month extension period ends. 1040x 2010 instructions When you file your return. 1040x 2010 instructions   Enter any payment you made related to the extension of time to file on Form 1040, line 68. 1040x 2010 instructions If you file Form 1040EZ or Form 1040A, include that payment in your total payments on Form 1040EZ, line 9, or Form 1040A, line 41. 1040x 2010 instructions Also enter “Form 4868” and the amount paid in the space to the left of line 9 or line 41. 1040x 2010 instructions Individuals Outside the United States You are allowed an automatic 2-month extension, without filing Form 4868, (until June 16, 2014, if you use the calendar year) to file your 2013 return and pay any federal income tax due if: You are a U. 1040x 2010 instructions S. 1040x 2010 instructions citizen or resident, and On the due date of your return: You are living outside the United States and Puerto Rico, and your main place of business or post of duty is outside the United States and Puerto Rico, or You are in military or naval service on duty outside the United States and  Puerto Rico. 1040x 2010 instructions However, if you pay the tax due after the regular due date (generally, April 15), interest will be charged from that date until the date the tax is paid. 1040x 2010 instructions If you served in a combat zone or qualified hazardous duty area, you may be eligible for a longer extension of time to file. 1040x 2010 instructions See Individuals Serving in Combat Zone , later, for special rules that apply to you. 1040x 2010 instructions Married taxpayers. 1040x 2010 instructions   If you file a joint return, only one spouse has to qualify for this automatic extension. 1040x 2010 instructions If you and your spouse file separate returns, this automatic extension applies only to the spouse who qualifies. 1040x 2010 instructions How to get the extension. 1040x 2010 instructions   To use this automatic extension, you must attach a statement to your return explaining what situation qualified you for the extension. 1040x 2010 instructions (See the situations listed under (2), earlier. 1040x 2010 instructions ) Extensions beyond 2 months. 1040x 2010 instructions   If you cannot file your return within the automatic 2-month extension period, you may be able to get an additional 4-month extension, for a total of 6 months. 1040x 2010 instructions File Form 4868 and check the box on line 8. 1040x 2010 instructions No further extension. 1040x 2010 instructions   An extension of more than 6 months will generally not be granted. 1040x 2010 instructions However, if you are outside the United States and meet certain tests, you may be granted a longer extension. 1040x 2010 instructions For more information, see When To File and Pay in Publication 54. 1040x 2010 instructions Individuals Serving in Combat Zone The deadline for filing your tax return, paying any tax you may owe, and filing a claim for refund is automatically extended if you serve in a combat zone. 1040x 2010 instructions This applies to members of the Armed Forces, as well as merchant marines serving aboard vessels under the operational control of the Department of Defense, Red Cross personnel, accredited correspondents, and civilians under the direction of the Armed Forces in support of the Armed Forces. 1040x 2010 instructions Combat zone. 1040x 2010 instructions   For purposes of the automatic extension, the term “combat zone” includes the following areas. 1040x 2010 instructions The Arabian peninsula area, effective January 17, 1991. 1040x 2010 instructions The Kosovo area, effective March 24, 1999. 1040x 2010 instructions Afghanistan area, effective September 19, 2001. 1040x 2010 instructions   See Publication 3, Armed Forces' Tax Guide, for more detailed information on the locations comprising each combat zone. 1040x 2010 instructions The publication also has information about other tax benefits available to military personnel serving in a combat zone. 1040x 2010 instructions Extension period. 1040x 2010 instructions   The deadline for filing your return, paying any tax due, and filing a claim for refund is extended for at least 180 days after the later of: The last day you are in a combat zone or the last day the area qualifies as a combat zone, or The last day of any continuous qualified hospitalization for injury from service in the combat zone. 1040x 2010 instructions   In addition to the 180 days, your deadline is also extended by the number of days you had left to take action with the IRS when you entered the combat zone. 1040x 2010 instructions For example, you have 3½ months (January 1 – April 15) to file your tax return. 1040x 2010 instructions Any days left in this period when you entered the combat zone (or the entire 3½ months if you entered it before the beginning of the year) are added to the 180 days. 1040x 2010 instructions See Extension of Deadlines in Publication 3 for more information. 1040x 2010 instructions   The rules on the extension for filing your return also apply when you are deployed outside the United States (away from your permanent duty station) while participating in a designated contingency operation. 1040x 2010 instructions How Do I Prepare My Return? This section explains how to get ready to fill in your tax return and when to report your income and expenses. 1040x 2010 instructions It also explains how to complete certain sections of the form. 1040x 2010 instructions You may find Table 1-6 helpful when you prepare your paper return. 1040x 2010 instructions Table 1-6. 1040x 2010 instructions Six Steps for Preparing Your Paper Return 1 — Get your records together for income and expenses. 1040x 2010 instructions 2 — Get the forms, schedules, and publications you need. 1040x 2010 instructions 3 — Fill in your return. 1040x 2010 instructions 4 — Check your return to make sure it is correct. 1040x 2010 instructions 5 — Sign and date your return. 1040x 2010 instructions 6 — Attach all required forms and schedules. 1040x 2010 instructions Electronic returns. 1040x 2010 instructions   For information you may find useful in preparing a paperless return, see Does My Return Have To Be on Paper , earlier. 1040x 2010 instructions Substitute tax forms. 1040x 2010 instructions   You cannot use your own version of a tax form unless it meets the requirements explained in Publication 1167, General Rules and Specifications for Substitute Forms and Schedules. 1040x 2010 instructions Form W-2. 1040x 2010 instructions   If you were an employee, you should receive Form W-2 from your employer. 1040x 2010 instructions You will need the information from this form to prepare your return. 1040x 2010 instructions See Form W-2 under Credit for Withholding and Estimated Tax in chapter 4. 1040x 2010 instructions   Your employer is required to provide or send Form W-2 to you no later than January 31, 2014. 1040x 2010 instructions If it is mailed, you should allow adequate time to receive it before contacting your employer. 1040x 2010 instructions If you still do not get the form by February 15, the IRS can help you by requesting the form from your employer. 1040x 2010 instructions When you request IRS help, be prepared to provide the following information. 1040x 2010 instructions Your name, address (including ZIP code), and phone number. 1040x 2010 instructions Your SSN. 1040x 2010 instructions Your dates of employment. 1040x 2010 instructions Your employer's name, address (including ZIP code), and phone number. 1040x 2010 instructions Form 1099. 1040x 2010 instructions   If you received certain types of income, you may receive a Form 1099. 1040x 2010 instructions For example, if you received taxable interest of $10 or more, the payer is required to provide or send Form 1099 to you no later than January 31, 2014 (or by February 18, 2014, if furnished by a broker). 1040x 2010 instructions If it is mailed, you should allow adequate time to receive it before contacting the payer. 1040x 2010 instructions If you still do not get the form by February 18 (or by March 5, 2014, if furnished by a broker), call the IRS for help. 1040x 2010 instructions When Do I Report My Income and Expenses? You must figure your taxable income on the basis of a tax year. 1040x 2010 instructions A “tax year” is an annual accounting period used for keeping records and reporting income and expenses. 1040x 2010 instructions You must account for your income and expenses in a way that clearly shows your taxable income. 1040x 2010 instructions The way you do this is called an accounting method. 1040x 2010 instructions This section explains which accounting periods and methods you can use. 1040x 2010 instructions Accounting Periods Most individual tax returns cover a calendar year—the 12 months from January 1 through December 31. 1040x 2010 instructions If you do not use a calendar year, your accounting period is a fiscal year. 1040x 2010 instructions A regular fiscal year is a 12-month period that ends on the last day of any month except December. 1040x 2010 instructions A 52-53-week fiscal year varies from 52 to 53 weeks and always ends on the same day of the week. 1040x 2010 instructions You choose your accounting period (tax year) when you file your first income tax return. 1040x 2010 instructions It cannot be longer than 12 months. 1040x 2010 instructions More information. 1040x 2010 instructions   For more information on accounting periods, including how to change your accounting period, see Publication 538, Accounting Periods and Methods. 1040x 2010 instructions Accounting Methods Your accounting method is the way you account for your income and expenses. 1040x 2010 instructions Most taxpayers use either the cash method or an accrual method. 1040x 2010 instructions You choose a method when you file your first income tax return. 1040x 2010 instructions If you want to change your accounting method after that, you generally must get IRS approval. 1040x 2010 instructions Cash method. 1040x 2010 instructions   If you use this method, report all items of income in the year in which you actually or constructively receive them. 1040x 2010 instructions Generally, you deduct all expenses in the year you actually pay them. 1040x 2010 instructions This is the method most individual taxpayers use. 1040x 2010 instructions Constructive receipt. 1040x 2010 instructions   Generally, you constructively receive income when it is credited to your account or set apart in any way that makes it available to you. 1040x 2010 instructions You do not need to have physical possession of it. 1040x 2010 instructions For example, interest credited to your bank account on December 31, 2013, is taxable income to you in 2013 if you could have withdrawn it in 2013 (even if the amount is not entered in your records or withdrawn until 2014). 1040x 2010 instructions Garnisheed wages. 1040x 2010 instructions   If your employer uses your wages to pay your debts, or if your wages are attached or garnisheed, the full amount is constructively received by you. 1040x 2010 instructions You must include these wages in income for the year you would have received them. 1040x 2010 instructions Debts paid for you. 1040x 2010 instructions   If another person cancels or pays your debts (but not as a gift or loan), you have constructively received the amount and generally must include it in your gross income for the year. 1040x 2010 instructions See Canceled Debts in chapter 12 for more information. 1040x 2010 instructions Payment to third party. 1040x 2010 instructions   If a third party is paid income from property you own, you have constructively received the income. 1040x 2010 instructions It is the same as if you had actually received the income and paid it to the third party. 1040x 2010 instructions Payment to an agent. 1040x 2010 instructions   Income an agent receives for you is income you constructively received in the year the agent receives it. 1040x 2010 instructions If you indicate in a contract that your income is to be paid to another person, you must include the amount in your gross income when the other person receives it. 1040x 2010 instructions Check received or available. 1040x 2010 instructions   A valid check that was made available to you before the end of the tax year is constructively received by you in that year. 1040x 2010 instructions A check that was “made available to you” includes a check you have already received, but not cashed or deposited. 1040x 2010 instructions It also includes, for example, your last paycheck of the year that your employer made available for you to pick up at the office before the end of the year. 1040x 2010 instructions It is constructively received by you in that year whether or not you pick it up before the end of the year or wait to receive it by mail after the end of the year. 1040x 2010 instructions No constructive receipt. 1040x 2010 instructions   There may be facts to show that you did not constructively receive income. 1040x 2010 instructions Example. 1040x 2010 instructions Alice Johnson, a teacher, agreed to her school board's condition that, in her absence, she would receive only the difference between her regular salary and the salary of a substitute teacher hired by the school board. 1040x 2010 instructions Therefore, Alice did not constructively receive the amount by which her salary was reduced to pay the substitute teacher. 1040x 2010 instructions Accrual method. 1040x 2010 instructions   If you use an accrual method, you generally report income when you earn it, rather than when you receive it. 1040x 2010 instructions You generally deduct your expenses when you incur them, rather than when you pay them. 1040x 2010 instructions Income paid in advance. 1040x 2010 instructions   An advance payment of income is generally included in gross income in the year you receive it. 1040x 2010 instructions Your method of accounting does not matter as long as the income is available to you. 1040x 2010 instructions An advance payment may include rent or interest you receive in advance and pay for services you will perform later. 1040x 2010 instructions   A limited deferral until the next tax year may be allowed for certain advance payments. 1040x 2010 instructions See Publication 538 for specific information. 1040x 2010 instructions Additional information. 1040x 2010 instructions   For more information on accounting methods, including how to change your accounting method, see Publication 538. 1040x 2010 instructions Social Security Number (SSN) You must enter your SSN on your return. 1040x 2010 instructions If you are married, enter the SSNs for both you and your spouse, whether you file jointly or separately. 1040x 2010 instructions If you are filing a joint return, include the SSNs in the same order as the names. 1040x 2010 instructions Use this same order in submitting other forms and documents to the IRS. 1040x 2010 instructions Check that both the name and SSN on your Form 1040, W-2, and 1099 agree with your social security card. 1040x 2010 instructions If they do not, certain deductions and credits on your Form 1040 may be reduced or disallowed and you may not receive credit for your social security earnings. 1040x 2010 instructions If your Form W-2 shows an incorrect SSN or name, notify your employer or the form-issuing agent as soon as possible to make sure your earnings are credited to your social security record. 1040x 2010 instructions If the name or SSN on your social security card is incorrect, call the SSA at 1-800-772-1213. 1040x 2010 instructions Name change. 1040x 2010 instructions   If you changed your name because of marriage, divorce, etc. 1040x 2010 instructions , be sure to report the change to your local Social Security Administration (SSA) office before filing your return. 1040x 2010 instructions This prevents delays in processing your return and issuing refunds. 1040x 2010 instructions It also safeguards your future social security benefits. 1040x 2010 instructions Dependent's SSN. 1040x 2010 instructions   You must provide the SSN of each dependent you claim, regardless of the dependent's age. 1040x 2010 instructions This requirement applies to all dependents (not just your children) claimed on your tax return. 1040x 2010 instructions Exception. 1040x 2010 instructions    If your child was born and died in 2013 and did not have an SSN, enter “DIED” in column (2) of line 6c (Form 1040 or 1040A) and include a copy of the child's birth certificate, death certificate, or hospital records. 1040x 2010 instructions The document must show that the child was born alive. 1040x 2010 instructions No SSN. 1040x 2010 instructions   File Form SS-5, Application for a Social Security Card, with your local SSA office to get an SSN for yourself or your dependent. 1040x 2010 instructions It usually takes about 2 weeks to get an SSN. 1040x 2010 instructions If you or your dependent is not eligible for an SSN, see Individual taxpayer identification number (ITIN) , later. 1040x 2010 instructions   If you are a U. 1040x 2010 instructions S. 1040x 2010 instructions citizen or resident alien, you must show proof of age, identity, and citizenship or alien status with your Form SS-5. 1040x 2010 instructions If you are 12 or older and have never been assigned an SSN, you must appear in person with this proof at an SSA office. 1040x 2010 instructions   Form SS-5 is available at any SSA office, on the Internet at www. 1040x 2010 instructions socialsecurity. 1040x 2010 instructions gov, or by calling 1-800-772-1213. 1040x 2010 instructions If you have any questions about which documents you can use as proof of age, identity, or citizenship, contact your SSA office. 1040x 2010 instructions   If your dependent does not have an SSN by the time your return is due, you may want to ask for an extension of time to file, as explained earlier under When Do I Have To File . 1040x 2010 instructions   If you do not provide a required SSN or if you provide an incorrect SSN, your tax may be increased and any refund may be reduced. 1040x 2010 instructions Adoption taxpayer identification number (ATIN). 1040x 2010 instructions   If you are in the process of adopting a child who is a U. 1040x 2010 instructions S. 1040x 2010 instructions citizen or resident and cannot get an SSN for the child until the adoption is final, you can apply for an ATIN to use instead of an SSN. 1040x 2010 instructions    File Form W-7A, Application for Taxpayer Identification Number for Pending U. 1040x 2010 instructions S. 1040x 2010 instructions Adoptions, with the IRS to get an ATIN if all of the following are true. 1040x 2010 instructions You have a child living with you who was placed in your home for legal adoption. 1040x 2010 instructions You cannot get the child's existing SSN even though you have made a reasonable attempt to get it from the birth parents, the placement agency, and other persons. 1040x 2010 instructions You cannot get an SSN for the child from the SSA because, for example, the adoption is not final. 1040x 2010 instructions You are eligible to claim the child as a dependent on your tax return. 1040x 2010 instructions After the adoption is final, you must apply for an SSN for the child. 1040x 2010 instructions You cannot continue using the ATIN. 1040x 2010 instructions   See Form W-7A for more information. 1040x 2010 instructions Nonresident alien spouse. 1040x 2010 instructions   If your spouse is a nonresident alien, your spouse must have either an SSN or an ITIN if: You file a joint return, You file a separate return and claim an exemption for your spouse, or Your spouse is filing a separate return. 1040x 2010 instructions If your spouse is not eligible for an SSN, see the following discussion on ITINs. 1040x 2010 instructions Individual taxpayer identification number (ITIN). 1040x 2010 instructions   The IRS will issue you an ITIN if you are a nonresident or resident alien and you do not have and are not eligible to get an SSN. 1040x 2010 instructions This also applies to an alien spouse or dependent. 1040x 2010 instructions To apply for an ITIN, file Form W-7 with the IRS. 1040x 2010 instructions It usually takes about 6 to 10 weeks to get an ITIN. 1040x 2010 instructions Enter the ITIN on your tax return wherever an SSN is requested. 1040x 2010 instructions    If you are applying for an ITIN for yourself, your spouse, or a dependent in order to file your tax return, attach your completed tax return to your Form W-7. 1040x 2010 instructions See the Form W-7 instructions for how and where to file. 1040x 2010 instructions You cannot e-file a return using an ITIN in the calendar year the ITIN is issued; however, you can e-file returns in the following years. 1040x 2010 instructions ITIN for tax use only. 1040x 2010 instructions   An ITIN is for tax use only. 1040x 2010 instructions It does not entitle you or your dependent to social security benefits or change the employment or immigration status of either of you under U. 1040x 2010 instructions S. 1040x 2010 instructions law. 1040x 2010 instructions Penalty for not providing social security number. 1040x 2010 instructions   If you do not include your SSN or the SSN of your spouse or dependent as required, you may have to pay a penalty. 1040x 2010 instructions See the discussion on Penalties , later, for more information. 1040x 2010 instructions SSN on correspondence. 1040x 2010 instructions   If you write to the IRS about your tax account, be sure to include your SSN (and the name and SSN of your spouse, if you filed a joint return) in your correspondence. 1040x 2010 instructions Because your SSN is used to identify your account, this helps the IRS respond to your correspondence promptly. 1040x 2010 instructions Presidential Election Campaign Fund This fund helps pay for Presidential election campaigns. 1040x 2010 instructions If you want $3 to go to this fund, check the box. 1040x 2010 instructions If you are filing a joint return, your spouse can also have $3 go to the fund. 1040x 2010 instructions If you check a box, your tax or refund will not change. 1040x 2010 instructions Computations The following information may be useful in making the return easier to complete. 1040x 2010 instructions Rounding off dollars. 1040x 2010 instructions   You can round off cents to whole dollars on your return and schedules. 1040x 2010 instructions If you do round to whole dollars, you must round all amounts. 1040x 2010 instructions To round, drop amounts under 50 cents and increase amounts from 50 to 99 cents to the next dollar. 1040x 2010 instructions For example, $1. 1040x 2010 instructions 39 becomes $1 and $2. 1040x 2010 instructions 50 becomes $3. 1040x 2010 instructions   If you have to add two or more amounts to figure the amount to enter on a line, include cents when adding the amounts and round off only the total. 1040x 2010 instructions Example. 1040x 2010 instructions You receive two Forms W-2: one showing wages of $5,000. 1040x 2010 instructions 55 and one showing wages of $18,500. 1040x 2010 instructions 73. 1040x 2010 instructions On Form 1040, line 7, you would enter $23,501 ($5,000. 1040x 2010 instructions 55 + $18,500. 1040x 2010 instructions 73 = $23,501. 1040x 2010 instructions 28), not $23,502 ($5,001 + $18,501). 1040x 2010 instructions Equal amounts. 1040x 2010 instructions   If you are asked to enter the smaller or larger of two equal amounts, enter that amount. 1040x 2010 instructions Example. 1040x 2010 instructions Line 1 is $500. 1040x 2010 instructions Line 3 is $500. 1040x 2010 instructions Line 5 asks you to enter the smaller of line 1 or 3. 1040x 2010 instructions Enter $500 on line 5. 1040x 2010 instructions Negative amounts. 1040x 2010 instructions   If you file a paper return and you need to enter a negative amount, put the amount in parentheses rather than using a minus sign. 1040x 2010 instructions To combine positive and negative amounts, add all the positive amounts together and then subtract the negative amounts. 1040x 2010 instructions Attachments Depending on the form you file and the items reported on your return, you may have to complete additional schedules and forms and attach them to your paper return. 1040x 2010 instructions You may be able to file a paperless return using IRS e-file. 1040x 2010 instructions There's nothing to attach or mail, not even your Forms W-2. 1040x 2010 instructions See Does My Return Have To Be on Paper, earlier. 1040x 2010 instructions Form W-2. 1040x 2010 instructions   Form W-2 is a statement from your employer of wages and other compensation paid to you and taxes withheld from your pay. 1040x 2010 instructions You should have a Form W-2 from each employer. 1040x 2010 instructions If you file a paper return, be sure to attach a copy of Form W-2 in the place indicated on the front page of your return. 1040x 2010 instructions Attach it to the front page of your paper return, not to any attachments. 1040x 2010 instructions For more information, see Form W-2 in chapter 4. 1040x 2010 instructions   If you received a Form 1099-R, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc. 1040x 2010 instructions , showing federal income tax withheld, and you file a paper return, attach a copy of that form in the place indicated on the front page of your return. 1040x 2010 instructions Form 1040EZ. 1040x 2010 instructions   There are no additional schedules to file with Form 1040EZ. 1040x 2010 instructions Form 1040A. 1040x 2010 instructions   If you file a paper return, attach any forms and schedules behind Form 1040A in order of the “Attachment Sequence Number” shown in the upper right corner of the form or schedule. 1040x 2010 instructions Then arrange all other statements or attachments in the same order as the forms and schedules they relate to and attach them last. 1040x 2010 instructions Do not attach items unless required to do so. 1040x 2010 instructions Form 1040. 1040x 2010 instructions   If you file a paper return, attach any forms and schedules behind Form 1040 in order of the “Attachment Sequence Number” shown in the upper right corner of the form or schedule. 1040x 2010 instructions Then arrange all other statements or attachments in the same order as the forms and schedules they relate to and attach them last. 1040x 2010 instructions Do not attach items unless required to do so. 1040x 2010 instructions Third Party Designee You can authorize the IRS to discuss your return with your preparer, a friend, family member, or any other person you choose. 1040x 2010 instructions If you check the “Yes” box in the Third party designee area of your 2013 tax return and provide the information required, you are authorizing: The IRS to call the designee to answer any questions that arise during the processing of your return, and The designee to: Give information that is missing from your return to the IRS, Call the IRS for information about th
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IRS Virtual Currency Guidance : Virtual Currency Is Treated as Property for U.S. Federal Tax Purposes; General Rules for Property Transactions Apply

IR-2014-36, March. 25, 2014

WASHINGTON — The Internal Revenue Service today issued a notice providing answers to frequently asked questions (FAQs) on virtual currency, such as bitcoin. These FAQs provide basic information on the U.S. federal tax implications of transactions in, or transactions that use, virtual currency.

In some environments, virtual currency operates like “real” currency -- i.e., the coin and paper money of the United States or of any other country that is designated as legal tender, circulates, and is customarily used and accepted as a medium of exchange in the country of issuance -- but it does not have legal tender status in any jurisdiction.

The notice provides that virtual currency is treated as property for U.S. federal tax purposes.  General tax principles that apply to property transactions apply to transactions using virtual currency.  Among other things, this means that:

  • Wages paid to employees using virtual currency are taxable to the employee, must be reported by an employer on a Form W-2, and are subject to federal income tax withholding and payroll taxes.
  • Payments using virtual currency made to independent contractors and other service providers are taxable and self-employment tax rules generally apply.  Normally, payers must issue Form 1099.
  • The character of gain or loss from the sale or exchange of virtual currency depends on whether the virtual currency is a capital asset in the hands of the taxpayer.
  • A payment made using virtual currency is subject to information reporting to the same extent as any other payment made in property. 

Further details, including a set of 16 questions and answers, are in Notice 2014-21, posted today on IRS.gov.

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Page Last Reviewed or Updated: 25-Mar-2014

The 1040x 2010 Instructions

1040x 2010 instructions Internal Revenue Bulletin:  2009-36  September 8, 2009  Rev. 1040x 2010 instructions Proc. 1040x 2010 instructions 2009-37 Table of Contents SECTION 1. 1040x 2010 instructions PURPOSE SECTION 2. 1040x 2010 instructions BACKGROUND SECTION 3. 1040x 2010 instructions SCOPE SECTION 4. 1040x 2010 instructions ELECTION PROCEDURES SECTION 5. 1040x 2010 instructions REQUIRED INFORMATION STATEMENT SECTION 6. 1040x 2010 instructions EFFECTIVE DATE SECTION 7. 1040x 2010 instructions TRANSITION RULE SECTION 8. 1040x 2010 instructions PAPERWORK REDUCTION ACT DRAFTING INFORMATION SECTION 1. 1040x 2010 instructions PURPOSE . 1040x 2010 instructions 01 This revenue procedure provides the exclusive procedures for taxpayers to make an election to defer recognizing discharge of indebtedness income (“COD income”) under § 108(i) of the Internal Revenue Code. 1040x 2010 instructions . 1040x 2010 instructions 02 This revenue procedure also requires taxpayers making the § 108(i) election to provide additional information on returns beginning with the taxable year following the taxable year for which the taxpayer makes the election. 1040x 2010 instructions This revenue procedure describes the time and manner of providing this additional information. 1040x 2010 instructions . 1040x 2010 instructions 03 The Internal Revenue Service and Treasury Department intend to issue additional guidance under § 108(i) that may include regulations addressing matters in this revenue procedure. 1040x 2010 instructions Taxpayers should be aware that these regulations may be retroactive. 1040x 2010 instructions See § 7805(b)(2). 1040x 2010 instructions This revenue procedure may be modified to provide procedures consistent with additional guidance. 1040x 2010 instructions SECTION 2. 1040x 2010 instructions BACKGROUND . 1040x 2010 instructions 01 Section 108(i), Generally. 1040x 2010 instructions Section 108(i) was added to the Code by § 1231 of the American Recovery and Reinvestment Tax Act of 2009, Pub. 1040x 2010 instructions L. 1040x 2010 instructions No. 1040x 2010 instructions 111-5, 123 Stat. 1040x 2010 instructions 338. 1040x 2010 instructions In general, § 108(i) provides that, at the election of a taxpayer, COD income realized in connection with a reacquisition after December 31, 2008, and before January 1, 2011, of an applicable debt instrument is includible in gross income ratably over a 5-taxable-year inclusion period, beginning with the taxpayer’s fourth or fifth taxable year following the taxable year of the reacquisition. 1040x 2010 instructions Generally, if a taxpayer makes a § 108(i) election and reacquires (or is treated as reacquiring) the applicable debt instrument generating the COD income for a new debt instrument with original issue discount (“OID”), then interest deductions for this OID also are deferred, as provided in § 108(i)(2). 1040x 2010 instructions The OID deferral rule, however, does not apply if the amount of OID is less than a de minimis amount, as determined under § 1273(a)(3) and § 1. 1040x 2010 instructions 1273-1(d) of the Income Tax Regulations. 1040x 2010 instructions The OID deferral rule in § 108(i)(2) applies at the entity level for a pass-through entity. 1040x 2010 instructions For example, a partnership (and therefore its partners) may not deduct currently the OID described in § 108(i)(2)(A)(i). 1040x 2010 instructions A taxpayer must take into account any item of income or deduction deferred under § 108(i), and not previously taken into account, in the taxable year in which certain events occur (such as the liquidation of the taxpayer and upon other events specified in administrative guidance). 1040x 2010 instructions See § 108(i)(5)(D). 1040x 2010 instructions The rule regarding acceleration of deferred COD income and OID deductions also applies in the case of certain dispositions by persons holding ownership interests in pass-through entities. 1040x 2010 instructions Section 108(i)(5)(D)(ii). 1040x 2010 instructions For purposes of § 108(i), regulated investment companies (as defined in § 851(a)) and real estate investment trusts (as defined in § 856(a)) are not pass-through entities. 1040x 2010 instructions . 1040x 2010 instructions 02 Applicable Debt Instrument. 1040x 2010 instructions Section 108(i)(3)(A) defines the term “applicable debt instrument” to mean any debt instrument issued by a C corporation or by any other person in connection with the conduct of a trade or business by that person. 1040x 2010 instructions The term “debt instrument” means any bond, debenture, note, certificate, or any other instrument or contractual arrangement constituting indebtedness within the meaning of § 1275(a)(1). 1040x 2010 instructions Section 108(i)(3)(B). 1040x 2010 instructions For purposes of § 108(i), in the case of an intercompany obligation (as defined in § 1. 1040x 2010 instructions 1502-13(g)(2)(ii)), an applicable debt instrument includes only an instrument for which COD income is realized upon the instrument’s deemed satisfaction under § 1. 1040x 2010 instructions 1502-13(g)(5). 1040x 2010 instructions . 1040x 2010 instructions 03 Reacquisition. 1040x 2010 instructions Section 108(i)(4)(A) defines the term “reacquisition” to mean, with respect to any applicable debt instrument, any acquisition of the debt instrument by the debtor that issued (or is otherwise the obligor under) the debt instrument, or a person related to the debtor under § 108(e)(4). 1040x 2010 instructions The term “acquisition” includes an acquisition of the debt instrument for cash or other property, the exchange of the debt instrument for another debt instrument (including an exchange resulting from a modification of the debt instrument), the exchange of the debt instrument for corporate stock or a partnership interest, the contribution of the debt instrument to capital, and the complete forgiveness of the indebtedness by the holder of the debt instrument. 1040x 2010 instructions See § 108(i)(4)(B). 1040x 2010 instructions The term “acquisition” also includes an indirect acquisition within the meaning of § 1. 1040x 2010 instructions 108-2(c) if a direct acquisition of the debt instrument would qualify for an election under § 108(i). 1040x 2010 instructions For example, if a corporation acquires debt of a partnership that the partnership issued in connection with its trade or business, and the partnership and corporation become related within six months of the corporation’s acquisition of the debt, the indirect acquisition is an acquisition for which an election under § 108(i) may be made. 1040x 2010 instructions . 1040x 2010 instructions 04 General Requirements for the Section 108(i) Election. 1040x 2010 instructions Section 108(i)(5)(B) provides, in general, that a taxpayer makes the § 108(i) election by including a statement that clearly identifies the applicable debt instrument with the return of tax imposed for the taxable year in which the reacquisition of the instrument occurs. 1040x 2010 instructions (For purposes of this revenue procedure, a return of tax or income tax return includes an information return, and a taxpayer includes a person that files an information return. 1040x 2010 instructions ) The statement must include the amount of income to which § 108(i)(1) applies and other information the Service may prescribe. 1040x 2010 instructions Once made, a § 108(i) election is irrevocable and, except as provided in section 7 of this revenue procedure, may not be modified. 1040x 2010 instructions . 1040x 2010 instructions 05 Section 108(i) Elections Made by Pass-through Entities. 1040x 2010 instructions In the case of COD income realized by a pass-through entity from the reacquisition of an applicable debt instrument, the pass-through entity makes the § 108(i) election. 1040x 2010 instructions Section 108(i)(5)(B)(iii). 1040x 2010 instructions . 1040x 2010 instructions 06 Additional Information on Subsequent Years’ Returns. 1040x 2010 instructions Section 108(i)(7) authorizes the Service to issue guidance necessary or appropriate for applying § 108(i), including requiring reporting the election and other information on returns of tax for subsequent taxable years. 1040x 2010 instructions . 1040x 2010 instructions 07 Exclusivity. 1040x 2010 instructions Section 108(i)(5)(C) provides that if a taxpayer elects to apply § 108(i) to an applicable debt instrument, § 108(a)(1)(A), (B), (C), and (D) do not apply to COD income deferred under § 108(i). 1040x 2010 instructions . 1040x 2010 instructions 08 Allocation of Deferred COD Income on Partnership Indebtedness. 1040x 2010 instructions Section 4. 1040x 2010 instructions 04(3) of this revenue procedure describes how a partnership may elect under § 108(i) to defer a portion of the COD income realized from the reacquisition of an applicable debt instrument. 1040x 2010 instructions If a partnership elects to defer all or any portion of COD income realized from the reacquisition of an applicable debt instrument, all of the COD income with respect to that debt instrument, without regard to § 108(i), is allocated to the partners in the partnership immediately before the reacquisition in the manner in which the income would be included in the distributive shares of these partners under § 704 and the regulations thereunder, including § 1. 1040x 2010 instructions 704-1(b)(2)(iii). 1040x 2010 instructions Each partner’s share of this COD income is the partner’s COD income amount (“COD income amount”). 1040x 2010 instructions The partner’s COD income amount that is deferred under § 108(i) is the partner’s deferred amount (“deferred amount”). 1040x 2010 instructions The partner’s COD income amount that is not deferred and is included in the partner’s distributive share of partnership income for the taxable year of the partnership in which the reacquisition occurs is the partner’s included amount (“included amount”). 1040x 2010 instructions . 1040x 2010 instructions 09 Partner’s Deferred § 752 Amount. 1040x 2010 instructions A decrease in a partner’s share of a partnership liability resulting from the reacquisition of an applicable debt instrument that is not treated as a current distribution of money to the partner under § 752 by reason of § 108(i)(6) is the partner’s deferred § 752 amount (“deferred § 752 amount”). 1040x 2010 instructions A partner’s deferred § 752 amount may not exceed the lesser of (i) the partner’s deferred amount or (ii) gain that the partner would recognize in the year of reacquisition under § 731 as a result of the reacquisition absent § 108(i)(6). 1040x 2010 instructions To determine the amount of gain the partner would recognize under clause (ii) of the preceding sentence, the amount of any deemed distribution of money under § 752(b) resulting from the decrease in the partner’s share of a reacquired applicable debt instrument that is treated as an advance or draw of money under § 1. 1040x 2010 instructions 731-1(a)(1)(ii) is determined as if no COD income resulting from the reacquisition of the applicable debt instrument is deferred under § 108(i). 1040x 2010 instructions See Rev. 1040x 2010 instructions Rul. 1040x 2010 instructions 92-97, 1992-2 C. 1040x 2010 instructions B. 1040x 2010 instructions 124, and Rev. 1040x 2010 instructions Rul. 1040x 2010 instructions 94-4, 1994-1 C. 1040x 2010 instructions B. 1040x 2010 instructions 195. 1040x 2010 instructions A partner’s deferred § 752 amount is treated as a distribution of money to the partner under § 752 at the same time, and to the extent remaining in the same amount, as the partner recognizes the COD income deferred under § 108(i). 1040x 2010 instructions . 1040x 2010 instructions 10 Allocation of Deferred COD Income on S Corporation Indebtedness. 1040x 2010 instructions For purposes of § 108(i), an S corporation’s COD income deferred under § 108(i) is shared pro rata only among those shareholders that are shareholders of the S corporation immediately before the reacquisition transaction. 1040x 2010 instructions . 1040x 2010 instructions 11 Deferred COD Income, Earnings and Profits, and Alternative Minimum Taxable Income. 1040x 2010 instructions (1) In general. 1040x 2010 instructions The Service and Treasury Department intend to issue regulations regarding the computation of a corporation’s earnings and profits with respect to COD income and OID deductions that are deferred under § 108(i). 1040x 2010 instructions These regulations generally will provide that deferred COD income increases earnings and profits in the taxable year that it is realized and not in the taxable year or years that the deferred COD income is includible in gross income. 1040x 2010 instructions OID deductions deferred under § 108(i) generally will decrease earnings and profits in the taxable year or years in which the deduction would be allowed without regard to § 108(i). 1040x 2010 instructions COD income and OID deductions that are deferred increase or decrease adjusted current earnings under § 56(g)(4) in the taxable year or years that the income or deduction is includible or deductible in determining taxable income. 1040x 2010 instructions See § 1. 1040x 2010 instructions 56(g)-1(c)(1). 1040x 2010 instructions (2) Exceptions for certain special status corporations. 1040x 2010 instructions The Service and Treasury Department intend to issue regulations providing that in the case of regulated investment companies and real estate investment trusts, COD income deferred under § 108(i) generally increases earnings and profits in the taxable year or years in which the deferred COD income is includible in gross income and not in the year that the deferred COD income is realized. 1040x 2010 instructions OID deductions deferred under § 108(i) generally decrease earnings and profits in the taxable year or years that the deferred OID deductions are deductible. 1040x 2010 instructions . 1040x 2010 instructions 12 Extension of Time to Make Election. 1040x 2010 instructions Under § 301. 1040x 2010 instructions 9100-1 of the Procedure and Administration Regulations, the Service may grant an extension of time to make a regulatory election. 1040x 2010 instructions An election is a regulatory election if the due date is prescribed by regulation or other published guidance of general applicability. 1040x 2010 instructions Section 301. 1040x 2010 instructions 9100-2(a) provides an automatic 12-month extension from the due date for making certain regulatory elections. 1040x 2010 instructions SECTION 3. 1040x 2010 instructions SCOPE This revenue procedure applies to taxpayers that realize COD income from a reacquisition after December 31, 2008, and before January 1, 2011, of an applicable debt instrument, as provided in § 108(i). 1040x 2010 instructions SECTION 4. 1040x 2010 instructions ELECTION PROCEDURES . 1040x 2010 instructions 01 In General. 1040x 2010 instructions (1) A taxpayer within the scope of this revenue procedure makes the § 108(i) election by— (a) Attaching a statement meeting the requirements of section 4. 1040x 2010 instructions 05 of this revenue procedure to the taxpayer’s timely filed (including extensions) original federal income tax return for the taxable year in which the reacquisition of the applicable debt instrument occurs, and (b) If applicable, satisfying the additional requirements of section 4. 1040x 2010 instructions 07, 4. 1040x 2010 instructions 08, 4. 1040x 2010 instructions 09, or 4. 1040x 2010 instructions 10 of this revenue procedure. 1040x 2010 instructions (2) The Service grants an automatic extension of 12 months from the due date prescribed in section 4. 1040x 2010 instructions 01(1)(a) of this revenue procedure for making the § 108(i) election. 1040x 2010 instructions The rules that apply to an automatic extension under § 301. 1040x 2010 instructions 9100-2(a) apply to this automatic extension. 1040x 2010 instructions . 1040x 2010 instructions 02 Section 108(i) Elections Made by Members of Consolidated Groups. 1040x 2010 instructions The common parent of a consolidated group makes the § 108(i) election on behalf of all members of the group. 1040x 2010 instructions See § 1. 1040x 2010 instructions 1502-77(a). 1040x 2010 instructions . 1040x 2010 instructions 03 Aggregation Rule. 1040x 2010 instructions A taxpayer within the scope of this revenue procedure may treat two or more applicable debt instruments that are part of the same issue and that are reacquired during the same taxable year as one applicable debt instrument for purposes of this revenue procedure. 1040x 2010 instructions A pass-through entity may not treat two or more applicable debt instruments as one applicable debt instrument under this section 4. 1040x 2010 instructions 03 if the owners and their ownership interests in the pass-through entity immediately prior to the reacquisition of each applicable debt instrument are not identical. 1040x 2010 instructions . 1040x 2010 instructions 04 Partial Elections. 1040x 2010 instructions (1) A taxpayer within the scope of this revenue procedure may make an election for any portion of COD income realized from the reacquisition of any applicable debt instrument. 1040x 2010 instructions Thus, for example, if a taxpayer realizes $100 of COD income from the reacquisition of an applicable debt instrument, the taxpayer may elect under § 108(i)(1) to defer only $40 of the $100 of COD income. 1040x 2010 instructions The taxpayer may exclude from income the portion of COD income that the taxpayer does not elect to defer under § 108(i) ($60 in this example) under § 108(a)(1)(A), (B), (C), or (D), if applicable. 1040x 2010 instructions (2) A taxpayer is not required to make an election for the same portion of COD income arising from each applicable debt instrument that it reacquires, but may make an election for different portions of COD income arising from different applicable debt instruments (whether or not part of the same issue). 1040x 2010 instructions Thus, for example, if a taxpayer realizes $100 of COD income from the reacquisition of an applicable debt instrument (Instrument A) and $100 of COD income from the reacquisition of a different applicable debt instrument (Instrument B), the taxpayer may elect to defer all or a portion of the COD income associated with Instrument A and none or a different portion of the COD income associated with Instrument B. 1040x 2010 instructions (3) A partnership that elects to defer less than all of the COD income realized from the reacquisition of an applicable debt instrument may determine, in any manner, the portion, if any, of a partner’s COD income amount that is the partner’s deferred amount and the portion, if any, of a partner’s COD income amount that is the partner’s included amount. 1040x 2010 instructions Thus, for example, one partner’s deferred amount may be zero while another partner’s deferred amount may equal that partner’s COD income amount (or any portion thereof). 1040x 2010 instructions A partner may exclude from income the partner’s included amount under § 108(a)(1)(A), (B), (C), or (D), if applicable. 1040x 2010 instructions The provisions of this section 4. 1040x 2010 instructions 04(3) apply for purposes of § 108(i) only and are not intended as an interpretation of or a change to existing law under § 704. 1040x 2010 instructions . 1040x 2010 instructions 05 Contents of Election Statement. 1040x 2010 instructions A statement meets the requirements of this section 4. 1040x 2010 instructions 05 if the statement— (1) Label. 1040x 2010 instructions States “Section 108(i) Election” across the top. 1040x 2010 instructions (2) Required information. 1040x 2010 instructions Provides, for each applicable debt instrument the reacquisition of which generates COD income that the taxpayer is electing to defer under § 108(i)— (a) The name and taxpayer identification numbers, if any, of the issuer or issuers of the applicable debt instrument; (b) A general description of the applicable debt instrument (including the issue and maturity dates) and, in the case of any person other than a C corporation, a general description of the person’s trade or business to which the applicable debt instrument is connected; (c) A general description of the reacquisition transaction or transactions generating the COD income (including the date(s) of the transaction(s)); (d) The total amount of COD income for the applicable debt instrument that results from the reacquisition (in the case of a partnership, the aggregate of the partners’ COD income amounts) and a general description of the manner in which this amount is calculated; (e) The amount of COD income for the applicable debt instrument that the taxpayer is electing to defer under § 108(i); (f) In the case of a partnership, a list of partners that have a deferred amount, their identifying information and each partner’s deferred amount; and in the case of an S corporation, a list of shareholders with COD income deferred under § 108(i), their identifying information and each shareholder’s share of the S corporation’s deferred COD income; and (g) In cases in which a new debt instrument is issued or deemed issued in exchange for the applicable debt instrument (including exchanges under § 108(e)(4), § 108(i)(2)(B), and § 1. 1040x 2010 instructions 1001-3), the issuer’s name, the issuer’s taxpayer identification number, if any, a general description of the new debt instrument and whether the new debt instrument has OID, and if the new debt instrument has OID, a schedule of the OID that the issuer expects to accrue each taxable year on the instrument and the amount of OID that the issuer expects to defer under § 108(i)(2) each taxable year. 1040x 2010 instructions . 1040x 2010 instructions 06 Supplemental information. 1040x 2010 instructions The statement described in section 4. 1040x 2010 instructions 05 of this revenue procedure may specify for each applicable debt instrument an amount greater than the amount identified in section 4. 1040x 2010 instructions 05(2)(e) of this revenue procedure that the taxpayer elects to defer under § 108(i) in the event the Service subsequently concludes that the taxpayer understated the amount of COD income described in section 4. 1040x 2010 instructions 05(2)(d) of this revenue procedure. 1040x 2010 instructions This additional amount of COD income the taxpayer elects to defer may be described as the entire additional COD income, or as a percentage of any additional COD income. 1040x 2010 instructions If the taxpayer is a partnership, the partnership must specify each partner’s share of the partnership’s additional COD income that would be deferred (the partner’s additional deferred amount), which the partnership may describe for each partner as the partner’s entire share of the partnership’s additional COD income or as a percentage of the partner’s share of the partnership’s additional COD income. 1040x 2010 instructions If the taxpayer is an S corporation, the S corporation must specify each shareholder’s share of the S corporation’s additional COD income that would be deferred, which the S corporation may describe for each shareholder as the shareholder’s entire share of the S corporation’s additional COD income or as a percentage of the shareholder’s share of the S corporation’s additional COD income. 1040x 2010 instructions In the case of partnerships and S corporations, the additional COD income and the portion of additional COD income that would be deferred are allocated or determined as provided in sections 2. 1040x 2010 instructions 08, 2. 1040x 2010 instructions 10 and, if applicable, 4. 1040x 2010 instructions 04(3) of this revenue procedure, respectively, as if the additional COD income was realized. 1040x 2010 instructions . 1040x 2010 instructions 07 Additional Requirements for Certain Partnerships Making a § 108(i) Election. 1040x 2010 instructions The rules of this section 4. 1040x 2010 instructions 07 apply to partnerships other than partnerships described in section 4. 1040x 2010 instructions 10 of this revenue procedure. 1040x 2010 instructions (1) Information filing on Schedule K-1 (Form 1065 and Form 1065-B). 1040x 2010 instructions For the taxable year in which the § 108(i) election is made, the partnership must report on the Schedule K-1 (Form 1065 or Form 1065-B), Partner’s Share of Income, Deductions, Credits, etc. 1040x 2010 instructions , in the manner specified in the instructions to the forms, for each partner § 108(i) information on an aggregate basis for all applicable debt instruments for which a § 108(i) election is made. 1040x 2010 instructions Partnerships reporting § 108(i) information on the 2008 Schedule K-1 (Form 1065 or Form 1065-B) must report for each partner on an aggregate basis for all applicable debt instruments for which a § 108(i) election is made: (a) The partner’s deferred amount that the partner must include in income in the current taxable year under § 108(i)(1) or § 108(i)(5)(D)(i) or (ii), in box 11 (“other income”) using code F for Schedule K-1 (Form 1065) or in box 9 (“other”) using code U for Schedule K-1 (Form 1065-B); (b) The partner’s share of the partnership’s OID deduction deferred under § 108(i)(2)(A)(i) that is allowable as a deduction in the current taxable year under § 108(i)(2)(A)(ii) or § 108(i)(5)(D)(i) or (ii), in box 13 (“other deductions”) using code W for Schedule K-1 (Form 1065) or in box 9 (“other”) using code U for Schedule K-1 (Form 1065-B); (c) The partner’s deferred amount that has not been included in income in the current or prior taxable years, in box 20 (“other information”) using code X for Schedule K-1 (Form 1065) or in box 9 (“other”) using code U for Schedule K-1 (Form 1065-B); (d) The partner’s share of the partnership’s OID deduction deferred under § 108(i)(2)(A)(i) that has not been deducted in the current or prior taxable years, in box 20 (“other information”) using code X for Schedule K-1 (Form 1065) or in box 9 (“other”) using code U for Schedule K-1 (Form 1065-B); (e) The partner’s deferred § 752 amount that is treated as a distribution of money to the partner under § 752 in the current taxable year, in box 20 (“other information”) using code X for Schedule K-1 (Form 1065) or in box 9 (“other”) using code U for Schedule K-1 (Form 1065-B); and (f) The partner’s deferred § 752 amount remaining as of the end of the current taxable year, in box 20 (“other information”) using code X for Schedule K-1 (Form 1065) or in box 9 (“other”) using code U for Schedule K-1 (Form 1065-B). 1040x 2010 instructions (2) Election information statement provided to partners. 1040x 2010 instructions The partnership must attach to the Schedule K-1 (Form 1065 or Form 1065-B) provided to each partner for the taxable year in which the § 108(i) election is made a statement satisfying the requirements of this section 4. 1040x 2010 instructions 07(2). 1040x 2010 instructions The partnership should not attach these statements to the Schedules K-1 that are filed with the Service, but must retain these statements, and each partner must retain that partner’s statement, in their respective books and records. 1040x 2010 instructions A statement meets the requirements of this section 4. 1040x 2010 instructions 07(2) if the statement— (a) Label. 1040x 2010 instructions States “Section 108(i) Election Information Statement for Partners” across the top. 1040x 2010 instructions (b) Required information. 1040x 2010 instructions Clearly identifies for each applicable debt instrument to which an election under § 108(i) applies— (i) The partner’s COD income amount, the partner’s deferred amount, and the partner’s included amount; (ii) The partner’s deferred amount that the partner must include in income in the current taxable year under § 108(i)(5)(D)(i) or (ii); (iii) The partner’s share of the partnership’s OID deduction deferred under § 108(i)(2)(A)(i) in the current taxable year; (iv) The partner’s share of the partnership’s OID deduction deferred under § 108(i)(2)(A)(i) that is allowable as a deduction in the current taxable year under § 108(i)(5)(D)(i) or (ii); (v) The partner’s share of each liability of the partnership described in section 4. 1040x 2010 instructions 05(2)(g) of this revenue procedure; (vi) The partner’s share of the decrease in the partnership liability that results from the reacquisition of the applicable debt instrument; (vii) The partner’s share of the decrease in the partnership liability that results from the reacquisition of the applicable debt instrument that is treated as a distribution of money to the partner under § 752 in the current taxable year; (viii) The partner’s deferred § 752 amount as described in section 2. 1040x 2010 instructions 09 of this revenue procedure; (ix) The partner’s additional deferred amount as described in section 4. 1040x 2010 instructions 06 of this revenue procedure; and (x) The date of the reacquisition transaction generating the COD income. 1040x 2010 instructions (c) If a partner fails to provide the written statement required by section 4. 1040x 2010 instructions 07(3) of this revenue procedure, the partnership must indicate that the amounts described in section 4. 1040x 2010 instructions 07(2)(b)(vii) and (viii) of this revenue procedure cannot be calculated because the partner did not provide the information necessary to report these amounts. 1040x 2010 instructions (3) Partner reporting requirements. 1040x 2010 instructions The partnership must make reasonable efforts prior to making a § 108(i) election to secure from each partner with a deferred amount for which it does not have the information necessary to compute the partner’s basis in its partnership interest (and its deferred § 752 amount as described in section 2. 1040x 2010 instructions 09 of this revenue procedure) a written statement signed under penalties of perjury that includes this information. 1040x 2010 instructions Each partner with a deferred amount must provide this written statement to the partnership within 30 days of the date of request by the partnership. 1040x 2010 instructions A partner’s failure to comply with this reporting requirement does not invalidate the partnership’s election under § 108(i) for an applicable debt instrument only if the partnership makes reasonable efforts before making the § 108(i) election to obtain the written statement from the partner and otherwise complies with the requirements of section 4 of this revenue procedure. 1040x 2010 instructions If a partner provides its written statement under this section 4. 1040x 2010 instructions 07(3) after the partnership has provided to the partner the Section 108(i) Election Information Statement for Partners, the partnership must provide to the partner a revised Section 108(i) Election Information Statement for Partners reporting the information required under section 4. 1040x 2010 instructions 07(2)(b)(vii) and (viii) of this revenue procedure and report the partner’s deferred § 752 amount on the partner’s Schedule K-1 (Form 1065 or Form 1065-B) in subsequent taxable years. 1040x 2010 instructions . 1040x 2010 instructions 08 Additional Requirements for an S Corporation Making a § 108(i) Election. 1040x 2010 instructions (1) Information filing on Schedule K-1 (Form 1120S). 1040x 2010 instructions For the taxable year in which the § 108(i) election is made, the S corporation must report on the Schedule K-1 (Form 1120S), Shareholder’s Share of Income, Deductions, Credits, etc. 1040x 2010 instructions , in the manner specified in the instructions to the forms, for each shareholder § 108(i) information on an aggregate basis for all applicable debt instruments for which a § 108(i) election is made. 1040x 2010 instructions S corporations reporting § 108(i) information on the 2008 Schedule K-1 (Form 1120S) must report for each shareholder, on an aggregate basis for all applicable debt instruments for which a § 108(i) election is made, the shareholder’s share of the S corporation’s: (a) COD income deferred under § 108(i) that the shareholder must include in income in the current taxable year under § 108(i)(1) or § 108(i)(5)(D)(i) or (ii), in box 10 (“other income”) using code E; (b) OID deduction deferred under § 108(i)(2)(A)(i) that is allowable as a deduction in the current taxable year under § 108(i)(2)(A)(ii), or § 108(i)(5)(D)(i) or (ii), in box 12 (“other deductions”) using code S; (c) COD income deferred under § 108(i) that has not been included in income in the current or prior taxable years, in box 17 (“other information”) using code T; and (d) OID deduction deferred under § 108(i)(2)(A)(i) that has not been deducted in the current or prior taxable years, in box 17 (“other information”) using code T. 1040x 2010 instructions (2) Election information statement provided to shareholders. 1040x 2010 instructions The S corporation must attach to the Schedule K-1 (Form 1120S) provided to each shareholder for the taxable year in which the § 108(i) election is made, a statement satisfying the requirements of this section 4. 1040x 2010 instructions 08(2). 1040x 2010 instructions The S corporation should not attach these statements to the Schedules K-1 that are filed with the Service, but must retain these statements, and each shareholder must retain that shareholder’s statement, in their respective books and records. 1040x 2010 instructions A statement meets the requirements of this section 4. 1040x 2010 instructions 08(2) if the statement— (a) Label. 1040x 2010 instructions States “Section 108(i) Election Information Statement for Shareholders” across the top. 1040x 2010 instructions (b) Required information. 1040x 2010 instructions Clearly identifies for each applicable debt instrument to which an election under § 108(i) applies, the shareholder’s share of the S corporation’s— (i) COD income that the S corporation elects to defer under § 108(i); (ii) COD income deferred under § 108(i) that the shareholder must include in income in the current taxable year under § 108(i)(5)(D)(i) or (ii); (iii) OID deduction deferred under § 108(i)(2)(A)(i) in the current taxable year; (iv) OID deduction deferred under § 108(i)(2)(A)(i) that is allowable as a deduction in the current taxable year under § 108(i)(5)(D)(i) or (ii); and (v) Additional COD income that would be deferred as described in section 4. 1040x 2010 instructions 06 of this revenue procedure. 1040x 2010 instructions . 1040x 2010 instructions 09 Section 108(i) Elections Made on Behalf of Certain Foreign Corporations. 1040x 2010 instructions The controlling domestic shareholder(s) (or common parent of the controlling domestic shareholder(s), if applicable) of a controlled foreign corporation or a noncontrolled § 902 corporation not otherwise required to file a return of tax may make the § 108(i) election on behalf of the foreign corporation by satisfying the requirements of § 1. 1040x 2010 instructions 964-1(c)(3). 1040x 2010 instructions Each controlling domestic shareholder must attach a statement identifying the foreign corporation and satisfying the requirements of section 4. 1040x 2010 instructions 05 of this revenue procedure and, if applicable, section 4. 1040x 2010 instructions 06 of this revenue procedure, to its federal income tax return for the taxable year ending within or with the taxable year of the foreign corporation for which the § 108(i) election is made. 1040x 2010 instructions . 1040x 2010 instructions 10 Section 108(i) Elections Made By Certain Foreign Partnerships. 1040x 2010 instructions The rules of this section 4. 1040x 2010 instructions 10 apply to a foreign partnership making a § 108(i) election that is not otherwise required to file a federal partnership return (“nonfiling foreign partnership”). 1040x 2010 instructions See § 1. 1040x 2010 instructions 6031(a)-1(b). 1040x 2010 instructions (1) A nonfiling foreign partnership making the election must attach a statement satisfying the requirements of section 4. 1040x 2010 instructions 05 of this revenue procedure and, if applicable, section 4. 1040x 2010 instructions 06 of this revenue procedure, to a partnership return satisfying the requirements of § 1. 1040x 2010 instructions 6031(a)-1(b)(5) it files with the Service. 1040x 2010 instructions In addition, a nonfiling foreign partnership must include in the information required in section 4. 1040x 2010 instructions 05(2)(d) and (e) of this revenue procedure the aggregate amounts for all partners as well as the aggregate amounts for all U. 1040x 2010 instructions S. 1040x 2010 instructions persons (as defined in § 7701(a)(30)) and controlled foreign corporation(s) that are partners with deferred amounts in the nonfiling foreign partnership (“affected partners”). 1040x 2010 instructions (2) The nonfiling foreign partnership must make the election, in accordance with § 1. 1040x 2010 instructions 6031(a)-1(b)(5), by the date provided in section 4. 1040x 2010 instructions 01(1)(a) of this revenue procedure, as if it had a filing obligation for the taxable year in which the reacquisition of the applicable debt instrument occurs. 1040x 2010 instructions (3) For each affected partner, the partnership must file with the Service a Schedule K-1 (Form 1065) and report on the Schedule K-1 (Form 1065) for the affected partner as provided in section 4. 1040x 2010 instructions 07(1) of this revenue procedure. 1040x 2010 instructions Except for this § 108(i) information, the partnership need not complete Part III of the Schedule K-1 (Form 1065). 1040x 2010 instructions The partnership must provide a copy of the respective Schedule K-1 (Form 1065) to each affected partner and must also attach to the Schedule K-1 (Form 1065) provided to each affected partner a statement satisfying the requirements of section 4. 1040x 2010 instructions 07(2) of this revenue procedure by the date provided in section 4. 1040x 2010 instructions 01(1)(a) of this revenue procedure. 1040x 2010 instructions The partnership should not attach any statement described in section 4. 1040x 2010 instructions 07(2) of this revenue procedure to the Schedules K-1 that are filed with the Service. 1040x 2010 instructions However, the partnership must retain the statements provided to the affected partners, and each affected partner must retain that partner’s statement, in their respective books and records. 1040x 2010 instructions (4) The partnership and each affected partner must satisfy the requirements of section 4. 1040x 2010 instructions 07(3) of this revenue procedure. 1040x 2010 instructions . 1040x 2010 instructions 11 Protective § 108(i) Election. 1040x 2010 instructions (1) In general. 1040x 2010 instructions A taxpayer may make a protective election under § 108(i) for an applicable debt instrument if the taxpayer concludes that a particular transaction does not result in the realization of COD income, reports the transaction on its federal income tax return in a manner consistent with the taxpayer’s conclusion, and would be within the scope of this revenue procedure if the taxpayer’s conclusion were incorrect. 1040x 2010 instructions If the Service at any time determines the taxpayer’s conclusion that the particular transaction does not result in the realization of COD income is incorrect, the taxpayer’s protective election is treated as a valid, irrevocable election under § 108(i). 1040x 2010 instructions Thus, if a taxpayer makes a protective election, the Service subsequently may require the taxpayer to report COD income deferred pursuant to the valid and irrevocable protective election even if the statute of limitations has expired for the year in which the COD income was realized and the protective election was made. 1040x 2010 instructions A taxpayer makes a protective election by attaching a statement satisfying the requirements of this section 4. 1040x 2010 instructions 11(1) to the taxpayer’s original federal income tax return within the period described in section 4. 1040x 2010 instructions 01(1)(a) of this revenue procedure. 1040x 2010 instructions The taxpayer also must attach the election to its federal income tax return in each of the 8 or 9 taxable years, as applicable, following the taxable year of the election. 1040x 2010 instructions A statement meets the requirements of this section 4. 1040x 2010 instructions 11(1) if the statement— (a) States “Section 108(i) Protective Election” across the top; (b) Provides the information required under section 4. 1040x 2010 instructions 05(2)(a), (b), and (c) of this revenue procedure; (c) Provides that the amounts described in sections 4. 1040x 2010 instructions 05(2)(d) and (e) of this revenue procedure are zero; and (d) Provides the information described in section 4. 1040x 2010 instructions 06 of this revenue procedure. 1040x 2010 instructions (2) Statements provided to shareholders and partners. 1040x 2010 instructions (a) For each applicable debt instrument, a partnership or S corporation that makes a protective election must attach to the Schedule K-1 (Form 1065, Form 1065-B, or Form 1120S) it provides each of its partners or shareholders, as the case may be, for the taxable year in which the protective election is made a statement containing the information described in section 4. 1040x 2010 instructions 11(1)(b) of this revenue procedure (an S corporation need not provide its shareholders with the date(s) of the transaction(s) that would constitute the reacquisition transaction or transactions) and the partner’s or shareholder’s share of the additional COD income that would be deferred as described in section 4. 1040x 2010 instructions 11(1)(d) of this revenue procedure. 1040x 2010 instructions (b) The partnership or S corporation should not attach the statements described in this section 4. 1040x 2010 instructions 11(2) to the Schedules K-1 that are filed with the Service but must retain these statements, and each partner and shareholder must retain that partner’s or shareholder’s statement, in their respective books and records. 1040x 2010 instructions . 1040x 2010 instructions 12 Election-Year Reporting by Tiered Pass-Through Entities. 1040x 2010 instructions (1) A partnership required to file a U. 1040x 2010 instructions S. 1040x 2010 instructions partnership return other than under § 1. 1040x 2010 instructions 6031(a)-1(b)(5), or an S corporation, that receives a Schedule K-1 (Form 1065 or Form 1065-B) reflecting its share of any items listed in section 4. 1040x 2010 instructions 07(1) of this revenue procedure, must report on the Schedules K-1 (Form 1065, Form 1065-B, or Form 1120S) to its partners or shareholders, as the case may be, each partner’s or shareholder’s share of those items (an S corporation only reports to its shareholders the items described in section 4. 1040x 2010 instructions 07(1)(a) through (d) of this revenue procedure). 1040x 2010 instructions (2) If a partnership described in section 4. 1040x 2010 instructions 12(1) of this revenue procedure receives a statement described in sections 4. 1040x 2010 instructions 07(2) or 4. 1040x 2010 instructions 10(3) of this revenue procedure or this section 4. 1040x 2010 instructions 12(2), it must provide each of its partners a statement containing the partner’s share of each of the items listed on each statement received by the partnership, including the information described in section 4. 1040x 2010 instructions 07(2)(b)(x) of this revenue procedure. 1040x 2010 instructions If an S corporation receives a statement described in sections 4. 1040x 2010 instructions 07(2) or 4. 1040x 2010 instructions 10(3) of this revenue procedure or this section 4. 1040x 2010 instructions 12(2), it must provide each of its shareholders a statement containing the shareholder’s share of each of the items listed on each statement received by the S corporation that are described in section 4. 1040x 2010 instructions 07(2)(b)(i), (ii), (iii), (iv) and (ix) of this revenue procedure. 1040x 2010 instructions The partnership or S corporation must attach this statement or statements to the Schedule K-1 (Form 1065, Form 1065-B, or Form 1120S) that it provides to each of its partners or shareholders, as the case may be, for the taxable year of the partnership or S corporation. 1040x 2010 instructions The partnership or S corporation should not attach these statements to the Schedules K-1 that are filed with the Service but must retain these statements, and each partner and shareholder must retain that partner’s or shareholder’s statement, in their respective books and records. 1040x 2010 instructions (3) A partnership that receives a statement described in this section 4 identifying its COD income amount with respect to an applicable debt instrument must allocate its COD income amount, without regard to § 108(i), to the partners in the partnership immediately before the reacquisition transaction in the manner in which the income would be included in the distributive shares of these partners under § 704 and the regulations thereunder, including § 1. 1040x 2010 instructions 704-1(b)(2)(iii). 1040x 2010 instructions The partnership may determine in any manner the portion, if any, of a partner’s COD income amount that is the partner’s deferred amount and the portion, if any, of a partner’s COD income amount that is the partner’s included amount. 1040x 2010 instructions No partner’s deferred amount with respect to an applicable debt instrument may exceed its COD income amount with respect to the applicable debt instrument, and the aggregate of deferred amounts of its partners with respect to an applicable debt instrument must equal the partnership’s deferred amount with respect to the applicable debt instrument. 1040x 2010 instructions The partnership allocates amounts described in section 4. 1040x 2010 instructions 06 of this revenue procedure under this section 4. 1040x 2010 instructions 12(3) as if the additional COD income was realized. 1040x 2010 instructions (4) The deferred § 752 amount for partners in a partnership making a § 108(i) election is calculated only for the partnership’s direct partners. 1040x 2010 instructions No further adjustment to the deferred § 752 amount is made to reflect the basis or other attributes of partners that are indirect partners in the partnership. 1040x 2010 instructions (5) If an S corporation receives a statement described in this section 4 identifying its COD income amount, deferred amount, included amount or additional COD income that would be deferred with respect to an applicable debt instrument, these amounts are shared pro rata only among those shareholders that are shareholders in the S corporation immediately before the reacquisition transaction. 1040x 2010 instructions (6) This paragraph 4. 1040x 2010 instructions 12(6) provides the rules for Category 1 and Category 2 filers of Form 8865, Return of U. 1040x 2010 instructions S. 1040x 2010 instructions Persons With Respect to Certain Foreign Partnerships, as defined in the instructions for Form 8865, if the foreign partnership, for which the Category 1 or Category 2 filer has a filing requirement, receives a Schedule K-1 (Form 1065 or Form 1065-B) reflecting the partnership’s share of any items listed in section 4. 1040x 2010 instructions 07(1) of this revenue procedure, or a statement described in sections 4. 1040x 2010 instructions 07(2) or 4. 1040x 2010 instructions 10(3) of this revenue procedure (because the foreign partnership owns an interest directly or indirectly in another partnership in which an election was made under § 108(i) with respect to that foreign partnership’s distributive share from the other entity). 1040x 2010 instructions (a) For each partner for whom the Category 1 filer is required to complete a Schedule K-1 (Form 8865) (which includes the Category 1 filer itself), the Category 1 filer must: (i) Include the information described in section 4. 1040x 2010 instructions 07(1) of this revenue procedure in the Schedule K-1 (Form 8865) that the Category 1 filer files with the Service and completes for the partner; (ii) Produce a statement containing the partner’s share of the items listed on each statement received by the partnership; and (iii) Attach the statement described in section 4. 1040x 2010 instructions 12(6)(a)(ii) of this revenue procedure to each Schedule K-1 (Form 8865) that it is required to provide to a partner of the foreign partnership. 1040x 2010 instructions (b) A Category 2 filer must include its share of the information described in section 4. 1040x 2010 instructions 07(1) on the Schedule K-1 (Form 8865) that it is required to complete. 1040x 2010 instructions Category 2 filers also must complete a statement containing their share of the items listed on each statement received by the partnership. 1040x 2010 instructions (c) The Category 1 and Category 2 filers should not attach the statements described in sections 4. 1040x 2010 instructions 12(6)(a)(ii) and 4. 1040x 2010 instructions 12(6)(b) of this revenue procedure, respectively, to the Schedules K-1 that are filed with the Service. 1040x 2010 instructions However, Category 1 filers must retain the statements they complete and each partner must retain its own statement, in their respective books and records. 1040x 2010 instructions (7) If as a result of § 108(i)(5)(D)(ii), a partner of a partnership described in section 4. 1040x 2010 instructions 12(1) of this revenue procedure or a shareholder of an S corporation described in section 4. 1040x 2010 instructions 12(1) of this revenue procedure must recognize items deferred under § 108(i), the partnership or S corporation must report these items on the Schedule K-1 (Form 1065, Form 1065-B, or Form 1120S) and statements provided to the partner or shareholder pursuant to section 4. 1040x 2010 instructions 12(1) and (2) of this revenue procedure. 1040x 2010 instructions Similar rules apply to Category 1 and Category 2 filers (Form 8865) described in section 4. 1040x 2010 instructions 12(6) of this revenue procedure. 1040x 2010 instructions (8) The provisions of section 4. 1040x 2010 instructions 12(2), (3), (5) and (6) of this revenue procedure also apply to a statement received that is described in section 4. 1040x 2010 instructions 11(2) of this revenue procedure, except that the information that must be provided are those items described in section 4. 1040x 2010 instructions 11(1)(b) of this revenue procedure (an S corporation need not provide its shareholders with the date(s) of the transaction(s) that would constitute the reacquisition transaction or transactions) and the share of the partner or shareholder in the amounts described in section 4. 1040x 2010 instructions 11(1)(d) of this revenue procedure. 1040x 2010 instructions SECTION 5. 1040x 2010 instructions REQUIRED INFORMATION STATEMENT . 1040x 2010 instructions 01 Annual Information Statements. 1040x 2010 instructions Pursuant to § 108(i)(7)(B), a taxpayer that makes an election under § 108(i) (except for a protective election under section 4. 1040x 2010 instructions 11(1) of this revenue procedure) must attach a statement meeting the requirements of section 5. 1040x 2010 instructions 02 of this revenue procedure to its federal income tax return for each taxable year beginning with the taxable year following the taxable year for which the taxpayer makes the election and ending with the first taxable year in which all items deferred under § 108(i) have been recognized. 1040x 2010 instructions . 1040x 2010 instructions 02 Contents of Statement. 1040x 2010 instructions A statement meets the requirements of this section 5. 1040x 2010 instructions 02 if the statement— (1) Label. 1040x 2010 instructions States “Section 108(i) Information Statement” across the top; (2) Required information. 1040x 2010 instructions Clearly identifies for each applicable debt instrument to which an election under § 108(i) applies— (a) COD income deferred under § 108(i) that is included in income in the current taxable year under § 108(i)(1); (b) COD income deferred under § 108(i) that is included in income in the current taxable year under § 108(i)(5)(D), including a description and date of the acceleration event described in § 108(i)(5)(D); (c) COD income deferred under § 108(i) that has not been included in income in the current or prior taxable years (in the case of a partnership, the aggregate of the partners’ deferred amounts that have not been included in income in the current or prior taxable years, and in the case of an S corporation, the S corporation’s COD income deferred under § 108(i) that has not been included in income in the current or prior taxable years); (d) OID deduction deferred under § 108(i)(2)(A)(i) that is allowable as a deduction in the current taxable year under § 108(i)(2)(A)(ii); (e) OID deduction deferred under § 108(i)(2)(A)(i) that is allowable as a deduction in the current taxable year under § 108(i)(5)(D); and (f) OID deduction deferred under § 108(i)(2)(A)(i) that has not been deducted in the current or prior taxable years. 1040x 2010 instructions (3) Election attached. 1040x 2010 instructions Includes a copy of the election statement described in section 4. 1040x 2010 instructions 05 of this revenue procedure. 1040x 2010 instructions . 1040x 2010 instructions 03 Additional Annual Reporting Requirements for Certain Partnerships. 1040x 2010 instructions The rules of this section 5. 1040x 2010 instructions 03 apply to partnerships other than partnerships described in section 5. 1040x 2010 instructions 05 of this revenue procedure. 1040x 2010 instructions (1) In general. 1040x 2010 instructions A partnership that makes an election under § 108(i) (except for a protective election under section 4. 1040x 2010 instructions 11(1) of this revenue procedure) must attach to its federal income tax returns the statements required under section 5. 1040x 2010 instructions 01 of this revenue procedure. 1040x 2010 instructions In addition, for each taxable year in which a statement is required under section 5. 1040x 2010 instructions 01 of this revenue procedure, the partnership must report on the Schedule K-1 (Form 1065 or Form 1065-B) for each partner § 108(i) information in the manner described in section 4. 1040x 2010 instructions 07(1) of this revenue procedure. 1040x 2010 instructions (2) Annual information statements provided to partners. 1040x 2010 instructions The partnership must attach to the Schedule K-1 (Form 1065) provided to each partner for each taxable year in which a statement is required under section 5. 1040x 2010 instructions 01 of this revenue procedure, a statement meeting the requirements of this section 5. 1040x 2010 instructions 03(2). 1040x 2010 instructions The partnership should not attach these statements to the Schedules K-1 that are filed with the Service, but must retain these statements, and each partner must retain that partner’s statement, in their respective books and records. 1040x 2010 instructions A statement meets the requirements of this section 5. 1040x 2010 instructions 03(2) if the statement— (a) Label. 1040x 2010 instructions States “Section 108(i) Annual Information Statement for Partners” across the top of the statement. 1040x 2010 instructions (b) Required information. 1040x 2010 instructions Clearly identifies for each applicable debt instrument to which a § 108(i) election applies— (i) The partner’s deferred amount that has not been included in income as of the end of the prior taxable year; (ii) The partner’s deferred amount that the partner must include in income in the current taxable year under § 108(i)(1); (iii) The partner’s deferred amount that the partner must include in income in the current taxable year under § 108(i)(5)(D)(i) or (ii); (iv) The partner’s deferred amount that has not been included in income in the current or prior taxable years; (v) The partner’s share of the partnership’s OID deduction deferred under § 108(i)(2)(A)(i) in the current taxable year; (vi) The partner’s share of the partnership’s OID deduction deferred under § 108(i)(2)(A)(i) that is allowable as a deduction in the current taxable year under § 108(i)(2)(A)(ii); (vii) The partner’s share of the partnership’s OID deduction deferred under § 108(i)(2)(A)(i) that is allowable as a deduction in the current taxable year under § 108(i)(5)(D)(i) or (ii); (viii) The partner’s share of the partnership’s OID deduction deferred under § 108(i)(2)(A)(i) that has not been deducted in the current or prior taxable years; and (ix) The partner’s deferred § 752 amount that is treated as a distribution of money to the partner under § 752 in the current taxable year and any remaining deferred § 752 amount. 1040x 2010 instructions If a partner fails to provide the written statement required by section 4. 1040x 2010 instructions 07(3) of this revenue procedure, the partnership must indicate that the amounts described in this section 5. 1040x 2010 instructions 03(2)(b)(ix) cannot be calculated because the partner did not provide the information necessary to report these amounts. 1040x 2010 instructions . 1040x 2010 instructions 04 Additional Annual Reporting Requirements for an S Corporation. 1040x 2010 instructions (1) In general. 1040x 2010 instructions An S corporation that makes an election under § 108(i) (except for a protective election under section 4. 1040x 2010 instructions 11(1) of this revenue procedure) must attach to its federal income tax returns the statements required under section 5. 1040x 2010 instructions 01 of this revenue procedure. 1040x 2010 instructions In addition, for each taxable year in which a statement is required under section 5. 1040x 2010 instructions 01 of this revenue procedure, the S corporation must report on the Schedule K-1 (Form 1120S) for each shareholder § 108(i) information in the manner described in section 4. 1040x 2010 instructions 08(1) of this revenue procedure. 1040x 2010 instructions (2) Annual information statements provided to shareholders. 1040x 2010 instructions The S corporation must attach to the Schedule K-1 (Form 1120S) provided to each shareholder for each taxable year in which a statement is required under section 5. 1040x 2010 instructions 01 of this revenue procedure a statement meeting the requirements of this section 5. 1040x 2010 instructions 04(2). 1040x 2010 instructions The S corporation should not attach these statements to the Schedules K-1 that are filed with the Service, but must retain these statements, and each shareholder must retain that shareholder’s statement, in their respective books and records. 1040x 2010 instructions A statement meets the requirements of this section 5. 1040x 2010 instructions 04(2) if the statement— (a) Label. 1040x 2010 instructions States “Section 108(i) Annual Information Statement for Shareholders” across the top; (b) Required information. 1040x 2010 instructions Clearly identifies for each applicable debt instrument to which an election under § 108(i) applies, the shareholder’s share of the S corporation’s— (i) COD income deferred under § 108(i) that has not been included in income as of the end of the prior taxable year; (ii) COD income deferred under § 108(i) that the shareholder must include in income in the current taxable year under § 108(i)(1); (iii) COD income deferred under § 108(i) that the shareholder must include in income in the current taxable year under § 108(i)(5)(D)(i) or (ii); (iv) COD income deferred under § 108(i) that has not been included in income in the current or prior taxable years; (v) OID deduction deferred under § 108(i)(2)(A)(i) in the current taxable year; (vi) OID deduction deferred under § 108(i)(2)(A)(i) that is allowable as a deduction in the current taxable year under § 108(i)(2)(A)(ii); (vii) OID deduction deferred under § 108(i)(2)(A)(i) that is allowable as a deduction in the current taxable year under § 108(i)(5)(D)(i) or (ii); and (viii) OID deduction deferred under § 108(i)(2)(A)(i) that has not been deducted in the current or prior taxable years. 1040x 2010 instructions . 1040x 2010 instructions 05 Additional Annual Reporting Requirements for Certain Foreign Partnerships. 1040x 2010 instructions (1) The rules of this section 5. 1040x 2010 instructions 05 apply to nonfiling foreign partnerships. 1040x 2010 instructions (2) A nonfiling foreign partnership that makes an election under § 108(i) (except for a protective election under section 4. 1040x 2010 instructions 11(1) of this revenue procedure) must file federal income tax returns with the Service containing the information under § 1. 1040x 2010 instructions 6031(a)-1(b)(5) for each taxable year in which a statement is required by section 5. 1040x 2010 instructions 01 of this revenue procedure. 1040x 2010 instructions (3) The nonfiling foreign partnership must attach to its federal income tax returns the statements required under section 5. 1040x 2010 instructions 01 of this revenue procedure, but only for that portion of the COD income allocated to affected partners. 1040x 2010 instructions (4) For each taxable year in which a statement is required under section 5. 1040x 2010 instructions 01 of this revenue procedure, the nonfiling foreign partnership must provide each affected partner a Schedule K-1 (Form 1065) reporting § 108(i) information in the manner described in section 4. 1040x 2010 instructions 07(1) of this revenue procedure. 1040x 2010 instructions Except for this § 108(i) information, the partnership need not complete Part III of the Schedule K-1 (Form 1065). 1040x 2010 instructions The partnership must provide each affected partner with a copy of the Schedule K-1 (Form 1065) by the date provided in § 1. 1040x 2010 instructions 6031(b)-1T(b). 1040x 2010 instructions The partnership must attach the Schedules K-1 (Form 1065) to the federal income tax returns filed with the Service pursuant to section 5. 1040x 2010 instructions 05(2) of this revenue procedure. 1040x 2010 instructions (5) For each taxable year for which a statement is required under section 5. 1040x 2010 instructions 01 of this revenue procedure, the nonfiling foreign partnership must attach to each affected partner’s Schedule K-1 (Form 1065) a statement meeting the requirements of section 5. 1040x 2010 instructions 03(2) of this revenue procedure. 1040x 2010 instructions The partnership should not attach these statements to the Schedules K-1 that are filed with the Service, but must retain the statements, and each partner must retain that partner’s statement, in their respective books and records. 1040x 2010 instructions . 1040x 2010 instructions 06 Information Statements Made on Behalf of Certain Foreign Corporations. 1040x 2010 instructions Each controlling domestic shareholder must attach a statement identifying the foreign corporation and meeting the requirements of section 5. 1040x 2010 instructions 02 of this revenue procedure to the shareholder’s federal income tax return for each taxable year for which a statement is required under section 5. 1040x 2010 instructions 01 of this revenue procedure. 1040x 2010 instructions . 1040x 2010 instructions 07 Additional Annual Reporting Requirements for Tiered Pass-Through Entities. 1040x 2010 instructions (1) A partnership required to file a U. 1040x 2010 instructions S. 1040x 2010 instructions partnership return other than under § 1. 1040x 2010 instructions 6031(a)-1(b)(5), or an S corporation, that receives a Schedule K-1 (Form 1065 or Form 1065-B) described in the second sentence of section 5. 1040x 2010 instructions 03(1) of this revenue procedure reflecting its share of any § 108(i) information must report on the Schedules K-1 (Form 1065, Form 1065-B, or Form 1120S) to its partners or shareholders, as the case may be, each partner’s or shareholder’s share of those items (an S corporation only reports to its shareholders the items described in section 4. 1040x 2010 instructions 07(1)(a) through (d) of this revenue procedure). 1040x 2010 instructions (2) If a partnership described in section 5. 1040x 2010 instructions 07(1) of this revenue procedure receives a statement described in sections 5. 1040x 2010 instructions 03(2) or 5. 1040x 2010 instructions 05(5) of this revenue procedure or this section 5. 1040x 2010 instructions 07(2), it must provide each of its partners a statement containing the partner’s share of each of the items listed on each statement received by the partnership. 1040x 2010 instructions If an S corporation receives a statement described in sections 5. 1040x 2010 instructions 03(2) or 5. 1040x 2010 instructions 05(5) of this revenue procedure or this section 5. 1040x 2010 instructions 07(2), it must provide each of its shareholders a statement containing the shareholder’s share of each of the items listed on each statement received by the S corporation that are described in section 5. 1040x 2010 instructions 03(2)(b)(i) through (viii) of this revenue procedure. 1040x 2010 instructions The partnership or S corporation must attach the statement or statements to the Schedule K-1 (Form 1065 or Form 1065-B) or Schedule K-1 (Form 1120S) that is provided to each of its partners or shareholders, as the case may be, for the taxable year of the partnership or S corporation. 1040x 2010 instructions The partnership or S corporation should not attach these statements to the Schedules K-1 that are filed with the Service, but must retain these statements, and each partner and shareholder must retain that partner’s or shareholder’s statement, in their respective books and records. 1040x 2010 instructions (3) This paragraph 5. 1040x 2010 instructions 07(3) provides the rules for persons described in section 4. 1040x 2010 instructions 12(6) of this revenue procedure if the foreign partnership, for which the Category 1 or 2 filer has a filing requirement, receives a Schedule K-1 (Form 1065 or Form 1065-B) reflecting the partnership’s share of any items described in the second sentence of section 5. 1040x 2010 instructions 03(1) of this revenue procedure, or a statement described in sections 5. 1040x 2010 instructions 03(2) or 5. 1040x 2010 instructions 05(5) of this revenue procedure (because the foreign partnership owns an interest directly or indirectly in another partnership in which an election was made under § 108(i) with respect to that foreign partnership’s distributive share from the other entity). 1040x 2010 instructions (a) For each partner for whom the Category 1 filer is required to complete a Schedule K-1 (Form 8865) (which includes the Category 1 filer itself), the Category 1 filer must: (i) Include the information described in section 4. 1040x 2010 instructions 07(1) of this revenue procedure in the Schedule K-1 (Form 8865) that the Category 1 filer files with the Service and completes for the partner; (ii) Produce a statement containing the partner’s share of the items listed on each statement received by the partnership; and (iii) Attach the statement described in section 5. 1040x 2010 instructions 07(3)(a)(ii) of this revenue procedure to each Schedule K-1 (Form 8865) that it is required to provide to a partner of the foreign partnership. 1040x 2010 instructions (b) A Category 2 filer must include its share of the information described in section 4. 1040x 2010 instructions 07(1) on the Schedule K-1 (Form 8865) that it is required to complete. 1040x 2010 instructions Category 2 filers also must complete a statement containing their share of the items listed on each statement received by the partnership. 1040x 2010 instructions (c) The Category 1 and Category 2 filers should not attach the statements described in sections 5. 1040x 2010 instructions 07(3)(a)(ii) and 5. 1040x 2010 instructions 07(3)(b) of this revenue procedure, respectively, to the Schedules K-1 that are filed with the Service. 1040x 2010 instructions However, Category 1 filers must retain the statements they complete and each partner must retain its own statement, in their respective books and records. 1040x 2010 instructions (4) If as a result of § 108(i)(5)(D)(ii), a partner of a partnership described in section 5. 1040x 2010 instructions 07(1) of this revenue procedure or a shareholder of an S corporation described in section 5. 1040x 2010 instructions 07(1) of this revenue procedure must recognize items deferred under § 108(i), the partnership or S corporation must report these items on the Schedule K-1 (Form 1065, Form 1065-B, or Form 1120S) and statements provided to the partner or shareholder pursuant to section 5. 1040x 2010 instructions 07(1) and (2) of this revenue procedure. 1040x 2010 instructions Similar rules apply to Category 1 and Category 2 filers (Form 8865) described in section 4. 1040x 2010 instructions 12(6) of this revenue procedure. 1040x 2010 instructions SECTION 6. 1040x 2010 instructions EFFECTIVE DATE This revenue procedure is effective for reacquisitions of applicable debt instruments in taxable years ending after December 31, 2008. 1040x 2010 instructions SECTION 7. 1040x 2010 instructions TRANSITION RULE . 1040x 2010 instructions 01 Noncomplying Election. 1040x 2010 instructions Except as otherwise provided in this section 7. 1040x 2010 instructions 01, the Service will treat a § 108(i) election as effective if a taxpayer files an election with the taxpayer’s federal income tax return filed on or before September 16, 2009, using any reasonable procedure to make the election. 1040x 2010 instructions However, an election that does not comply with section 4 of this revenue procedure will not be effective unless the taxpayer on or before November 16, 2009, files an amended return for the taxable year of the election and complies with the requirements of section 4 of this revenue procedure. 1040x 2010 instructions . 1040x 2010 instructions 02 Modification of Election. 1040x 2010 instructions A taxpayer that files a § 108(i) election on or before September 16, 2009, may modify that election by filing an amended return on or before November 16, 2009 (for example, to modify the amount of COD income the taxpayer elects to defer). 1040x 2010 instructions To be effective, a modification of an election described in the preceding sentence must satisfy the requirements for an election described in section 4 of this revenue procedure. 1040x 2010 instructions . 1040x 2010 instructions 03 Notations. 1040x 2010 instructions A taxpayer that files the amended return on paper must write “Section 108(i) Election” on the top of the first page. 1040x 2010 instructions A taxpayer that files the amended return electronically should indicate “Section 108(i) Election” on the return. 1040x 2010 instructions See Publication 4163, Modernized e-File (MeF) Information for Authorized IRS e-file Providers for Business Returns Tax Year 2008 for more details. 1040x 2010 instructions SECTION 8. 1040x 2010 instructions PAPERWORK REDUCTION ACT The collection of information contained in this revenue procedure has been reviewed and approved by the Office of Management and Budget in accordance with the Paperwork Reduction Act (44 U. 1040x 2010 instructions S. 1040x 2010 instructions C. 1040x 2010 instructions 3507) under control number 1545-2147. 1040x 2010 instructions An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless the collection of information displays a valid OMB control number. 1040x 2010 instructions The collection of information in this revenue procedure is in sections 4, 5 and 7. 1040x 2010 instructions This information is required to determine the amount of income and deductions a taxpayer elects to defer and to track those amounts until the taxpayer has reported all deferred income and deductions on the taxpayer’s tax return. 1040x 2010 instructions This information will be used during examination to verify that a taxpayer has correctly deferred income and deductions. 1040x 2010 instructions The collection of information is required to obtain a benefit. 1040x 2010 instructions The likely respondents are C corporations, shareholders of S corporations, partners of partnerships, and other individuals engaged in a trade or business, that reacquire applicable debt instruments in 2009 or 2010. 1040x 2010 instructions The estimated total annual reporting burden is 300,000 hours. 1040x 2010 instructions The estimated annual burden per respondent varies from 1 to 8 hours, depending on individual circumstances, with an estimated average of 6 hours. 1040x 2010 instructions The estimated number of respondents is 50,000. 1040x 2010 instructions Books or records relating to a collection of information must be retained as long as their contents may become material in the administration of any internal revenue law. 1040x 2010 instructions Generally, tax returns and return information are confidential, as required by § 6103. 1040x 2010 instructions DRAFTING INFORMATION The principal authors of this revenue procedure are Megan A. 1040x 2010 instructions Stoner of the Office of Associate Chief Counsel (Passthroughs & Special Industries) and Craig Wojay of the Office of Associate Chief Counsel (Income Tax & Accounting). 1040x 2010 instructions For further information regarding this revenue procedure, contact Megan A. 1040x 2010 instructions Stoner at (202) 622-3070 for questions involving partnerships and S corporations, William E. 1040x 2010 instructions Blanchard at (202) 622-3950 for questions involving OID, Ronald M. 1040x 2010 instructions Gootzeit at (202) 622-3860 for questions involving foreign entities, Robert Rhyne at (202) 622-7790 for questions involving earnings and profits and consolidated groups, and Craig Wojay at (202) 622-4920 for questions on § 108(i) generally (not toll-free calls). 1040x 2010 instructions Prev  Up  Next   Home   More Internal Revenue Bulletins