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2005 Tax Return Online

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2005 Tax Return Online

2005 tax return online 18. 2005 tax return online   Alimony Table of Contents IntroductionSpouse or former spouse. 2005 tax return online Divorce or separation instrument. 2005 tax return online Useful Items - You may want to see: General RulesMortgage payments. 2005 tax return online Taxes and insurance. 2005 tax return online Other payments to a third party. 2005 tax return online Instruments Executed After 1984Payments to a third party. 2005 tax return online Exception. 2005 tax return online Substitute payments. 2005 tax return online Specifically designated as child support. 2005 tax return online Contingency relating to your child. 2005 tax return online Clearly associated with a contingency. 2005 tax return online How To Deduct Alimony Paid How To Report Alimony Received Recapture Rule Introduction This chapter discusses the rules that apply if you pay or receive alimony. 2005 tax return online It covers the following topics. 2005 tax return online What payments are alimony. 2005 tax return online What payments are not alimony, such as child support. 2005 tax return online How to deduct alimony you paid. 2005 tax return online How to report alimony you received as income. 2005 tax return online Whether you must recapture the tax benefits of alimony. 2005 tax return online Recapture means adding back in your income all or part of a deduction you took in a prior year. 2005 tax return online Alimony is a payment to or for a spouse or former spouse under a divorce or separation instrument. 2005 tax return online It does not include voluntary payments that are not made under a divorce or separation instrument. 2005 tax return online Alimony is deductible by the payer and must be included in the spouse's or former spouse's income. 2005 tax return online Although this chapter is generally written for the payer of the alimony, the recipient can use the information to determine whether an amount received is alimony. 2005 tax return online To be alimony, a payment must meet certain requirements. 2005 tax return online Different requirements generally apply to payments under instruments executed after 1984 and to payments under instruments executed before 1985. 2005 tax return online This chapter discusses the rules for payments under instruments executed after 1984. 2005 tax return online If you need the rules for payments under pre-1985 instruments, get and keep a copy of the 2004 version of Publication 504. 2005 tax return online That was the last year the information on pre-1985 instruments was included in Publication 504. 2005 tax return online Use Table 18-1 in this chapter as a guide to determine whether certain payments are considered alimony. 2005 tax return online Definitions. 2005 tax return online   The following definitions apply throughout this chapter. 2005 tax return online Spouse or former spouse. 2005 tax return online   Unless otherwise stated, the term “spouse” includes former spouse. 2005 tax return online Divorce or separation instrument. 2005 tax return online   The term “divorce or separation instrument” means: A decree of divorce or separate maintenance or a written instrument incident to that decree, A written separation agreement, or A decree or any type of court order requiring a spouse to make payments for the support or maintenance of the other spouse. 2005 tax return online This includes a temporary decree, an interlocutory (not final) decree, and a decree of alimony pendente lite (while awaiting action on the final decree or agreement). 2005 tax return online Useful Items - You may want to see: Publication 504 Divorced or Separated Individuals General Rules The following rules apply to alimony regardless of when the divorce or separation instrument was executed. 2005 tax return online Payments not alimony. 2005 tax return online   Not all payments under a divorce or separation instrument are alimony. 2005 tax return online Alimony does not include: Child support, Noncash property settlements, Payments that are your spouse's part of community income, as explained under Community Property in Publication 504, Payments to keep up the payer's property, or Use of the payer's property. 2005 tax return online Payments to a third party. 2005 tax return online   Cash payments, checks, or money orders to a third party on behalf of your spouse under the terms of your divorce or separation instrument can be alimony, if they otherwise qualify. 2005 tax return online These include payments for your spouse's medical expenses, housing costs (rent, utilities, etc. 2005 tax return online ), taxes, tuition, etc. 2005 tax return online The payments are treated as received by your spouse and then paid to the third party. 2005 tax return online Life insurance premiums. 2005 tax return online   Alimony includes premiums you must pay under your divorce or separation instrument for insurance on your life to the extent your spouse owns the policy. 2005 tax return online Payments for jointly-owned home. 2005 tax return online   If your divorce or separation instrument states that you must pay expenses for a home owned by you and your spouse, some of your payments may be alimony. 2005 tax return online Mortgage payments. 2005 tax return online   If you must pay all the mortgage payments (principal and interest) on a jointly-owned home, and they otherwise qualify as alimony, you can deduct one-half of the total payments as alimony. 2005 tax return online If you itemize deductions and the home is a qualified home, you can claim one-half of the interest in figuring your deductible interest. 2005 tax return online Your spouse must report one-half of the payments as alimony received. 2005 tax return online If your spouse itemizes deductions and the home is a qualified home, he or she can claim one-half of the interest on the mortgage in figuring deductible interest. 2005 tax return online Taxes and insurance. 2005 tax return online   If you must pay all the real estate taxes or insurance on a home held as tenants in common, you can deduct one-half of these payments as alimony. 2005 tax return online Your spouse must report one-half of these payments as alimony received. 2005 tax return online If you and your spouse itemize deductions, you can each claim one-half of the real estate taxes and none of the home insurance. 2005 tax return online    If your home is held as tenants by the entirety or joint tenants, none of your payments for taxes or insurance are alimony. 2005 tax return online But if you itemize deductions, you can claim all of the real estate taxes and none of the home insurance. 2005 tax return online Other payments to a third party. 2005 tax return online   If you made other third-party payments, see Publication 504 to see whether any part of the payments qualifies as alimony. 2005 tax return online Instruments Executed After 1984 The following rules for alimony apply to payments under divorce or separation instruments executed after 1984. 2005 tax return online Exception for instruments executed before 1985. 2005 tax return online   There are two situations where the rules for instruments executed after 1984 apply to instruments executed before 1985. 2005 tax return online A divorce or separation instrument executed before 1985 and then modified after 1984 to specify that the after-1984 rules will apply. 2005 tax return online A temporary divorce or separation instrument executed before 1985 and incorporated into, or adopted by, a final decree executed after 1984 that: Changes the amount or period of payment, or Adds or deletes any contingency or condition. 2005 tax return online   For the rules for alimony payments under pre-1985 instruments not meeting these exceptions, get the 2004 version of Publication 504 at www. 2005 tax return online irs. 2005 tax return online gov/pub504. 2005 tax return online Example 1. 2005 tax return online In November 1984, you and your former spouse executed a written separation agreement. 2005 tax return online In February 1985, a decree of divorce was substituted for the written separation agreement. 2005 tax return online The decree of divorce did not change the terms for the alimony you pay your former spouse. 2005 tax return online The decree of divorce is treated as executed before 1985. 2005 tax return online Alimony payments under this decree are not subject to the rules for payments under instruments executed after 1984. 2005 tax return online Example 2. 2005 tax return online Assume the same facts as in Example 1 except that the decree of divorce changed the amount of the alimony. 2005 tax return online In this example, the decree of divorce is not treated as executed before 1985. 2005 tax return online The alimony payments are subject to the rules for payments under instruments executed after 1984. 2005 tax return online Alimony requirements. 2005 tax return online   A payment to or for a spouse under a divorce or separation instrument is alimony if the spouses do not file a joint return with each other and all the following requirements are met. 2005 tax return online The payment is in cash. 2005 tax return online The instrument does not designate the payment as not alimony. 2005 tax return online Spouses legally separated under a decree of divorce or separate maintenance are not members of the same household. 2005 tax return online There is no liability to make any payment (in cash or property) after the death of the recipient spouse. 2005 tax return online The payment is not treated as child support. 2005 tax return online Each of these requirements is discussed below. 2005 tax return online Cash payment requirement. 2005 tax return online   Only cash payments, including checks and money orders, qualify as alimony. 2005 tax return online The following do not qualify as alimony. 2005 tax return online Transfers of services or property (including a debt instrument of a third party or an annuity contract). 2005 tax return online Execution of a debt instrument by the payer. 2005 tax return online The use of the payer's property. 2005 tax return online Payments to a third party. 2005 tax return online   Cash payments to a third party under the terms of your divorce or separation instrument can qualify as cash payments to your spouse. 2005 tax return online See Payments to a third party under General Rules, earlier. 2005 tax return online   Also, cash payments made to a third party at the written request of your spouse may qualify as alimony if all the following requirements are met. 2005 tax return online The payments are in lieu of payments of alimony directly to your spouse. 2005 tax return online The written request states that both spouses intend the payments to be treated as alimony. 2005 tax return online You receive the written request from your spouse before you file your return for the year you made the payments. 2005 tax return online Payments designated as not alimony. 2005 tax return online   You and your spouse can designate that otherwise qualifying payments are not alimony. 2005 tax return online You do this by including a provision in your divorce or separation instrument that states the payments are not deductible as alimony by you and are excludable from your spouse's income. 2005 tax return online For this purpose, any instrument (written statement) signed by both of you that makes this designation and that refers to a previous written separation agreement is treated as a written separation agreement (and therefore a divorce or separation instrument). 2005 tax return online If you are subject to temporary support orders, the designation must be made in the original or a later temporary support order. 2005 tax return online   Your spouse can exclude the payments from income only if he or she attaches a copy of the instrument designating them as not alimony to his or her return. 2005 tax return online The copy must be attached each year the designation applies. 2005 tax return online Spouses cannot be members of the same household. 2005 tax return online    Payments to your spouse while you are members of the same household are not alimony if you are legally separated under a decree of divorce or separate maintenance. 2005 tax return online A home you formerly shared is considered one household, even if you physically separate yourselves in the home. 2005 tax return online   You are not treated as members of the same household if one of you is preparing to leave the household and does leave no later than 1 month after the date of the payment. 2005 tax return online Exception. 2005 tax return online   If you are not legally separated under a decree of divorce or separate maintenance, a payment under a written separation agreement, support decree, or other court order may qualify as alimony even if you are members of the same household when the payment is made. 2005 tax return online Table 18-1. 2005 tax return online Alimony Requirements (Instruments Executed After 1984) Payments ARE alimony if all of the following are true: Payments are NOT alimony if any of the following are true: Payments are required by a divorce or separation instrument. 2005 tax return online Payments are not required by a divorce or separation instrument. 2005 tax return online Payer and recipient spouse do not file a joint return with each other. 2005 tax return online Payer and recipient spouse file a joint return with each other. 2005 tax return online Payment is in cash (including checks or money orders). 2005 tax return online Payment is: Not in cash, A noncash property settlement, Spouse's part of community income, or To keep up the payer's property. 2005 tax return online Payment is not designated in the instrument as not alimony. 2005 tax return online Payment is designated in the instrument as not alimony. 2005 tax return online Spouses legally separated under a decree of divorce or separate maintenance are not members of the same household. 2005 tax return online Spouses legally separated under a decree of divorce or separate maintenance are members of the same household. 2005 tax return online Payments are not required after death of the recipient spouse. 2005 tax return online Payments are required after death of the recipient spouse. 2005 tax return online Payment is not treated as child support. 2005 tax return online Payment is treated as child support. 2005 tax return online These payments are deductible by the payer and includible in income by the recipient. 2005 tax return online These payments are neither deductible by the payer nor includible in income by the recipient. 2005 tax return online Liability for payments after death of recipient spouse. 2005 tax return online   If any part of payments you make must continue to be made for any period after your spouse's death, that part of your payments is not alimony, whether made before or after the death. 2005 tax return online If all of the payments would continue, then none of the payments made before or after the death are alimony. 2005 tax return online   The divorce or separation instrument does not have to expressly state that the payments cease upon the death of your spouse if, for example, the liability for continued payments would end under state law. 2005 tax return online Example. 2005 tax return online You must pay your former spouse $10,000 in cash each year for 10 years. 2005 tax return online Your divorce decree states that the payments will end upon your former spouse's death. 2005 tax return online You must also pay your former spouse or your former spouse's estate $20,000 in cash each year for 10 years. 2005 tax return online The death of your spouse would not terminate these payments under state law. 2005 tax return online The $10,000 annual payments may qualify as alimony. 2005 tax return online The $20,000 annual payments that do not end upon your former spouse's death are not alimony. 2005 tax return online Substitute payments. 2005 tax return online   If you must make any payments in cash or property after your spouse's death as a substitute for continuing otherwise qualifying payments before the death, the otherwise qualifying payments are not alimony. 2005 tax return online To the extent that your payments begin, accelerate, or increase because of the death of your spouse, otherwise qualifying payments you made may be treated as payments that were not alimony. 2005 tax return online Whether or not such payments will be treated as not alimony depends on all the facts and circumstances. 2005 tax return online Example 1. 2005 tax return online Under your divorce decree, you must pay your former spouse $30,000 annually. 2005 tax return online The payments will stop at the end of 6 years or upon your former spouse's death, if earlier. 2005 tax return online Your former spouse has custody of your minor children. 2005 tax return online The decree provides that if any child is still a minor at your spouse's death, you must pay $10,000 annually to a trust until the youngest child reaches the age of majority. 2005 tax return online The trust income and corpus (principal) are to be used for your children's benefit. 2005 tax return online These facts indicate that the payments to be made after your former spouse's death are a substitute for $10,000 of the $30,000 annual payments. 2005 tax return online Of each of the $30,000 annual payments, $10,000 is not alimony. 2005 tax return online Example 2. 2005 tax return online Under your divorce decree, you must pay your former spouse $30,000 annually. 2005 tax return online The payments will stop at the end of 15 years or upon your former spouse's death, if earlier. 2005 tax return online The decree provides that if your former spouse dies before the end of the 15-year period, you must pay the estate the difference between $450,000 ($30,000 × 15) and the total amount paid up to that time. 2005 tax return online For example, if your spouse dies at the end of the tenth year, you must pay the estate $150,000 ($450,000 − $300,000). 2005 tax return online These facts indicate that the lump-sum payment to be made after your former spouse's death is a substitute for the full amount of the $30,000 annual payments. 2005 tax return online None of the annual payments are alimony. 2005 tax return online The result would be the same if the payment required at death were to be discounted by an appropriate interest factor to account for the prepayment. 2005 tax return online Child support. 2005 tax return online   A payment that is specifically designated as child support or treated as specifically designated as child support under your divorce or separation instrument is not alimony. 2005 tax return online The amount of child support may vary over time. 2005 tax return online Child support payments are not deductible by the payer and are not taxable to the recipient. 2005 tax return online Specifically designated as child support. 2005 tax return online   A payment will be treated as specifically designated as child support to the extent that the payment is reduced either: On the happening of a contingency relating to your child, or At a time that can be clearly associated with the contingency. 2005 tax return online A payment may be treated as specifically designated as child support even if other separate payments are specifically designated as child support. 2005 tax return online Contingency relating to your child. 2005 tax return online   A contingency relates to your child if it depends on any event relating to that child. 2005 tax return online It does not matter whether the event is certain or likely to occur. 2005 tax return online Events relating to your child include the child's: Becoming employed, Dying, Leaving the household, Leaving school, Marrying, or Reaching a specified age or income level. 2005 tax return online Clearly associated with a contingency. 2005 tax return online   Payments that would otherwise qualify as alimony are presumed to be reduced at a time clearly associated with the happening of a contingency relating to your child only in the following situations. 2005 tax return online The payments are to be reduced not more than 6 months before or after the date the child will reach 18, 21, or local age of majority. 2005 tax return online The payments are to be reduced on two or more occasions that occur not more than 1 year before or after a different one of your children reaches a certain age from 18 to 24. 2005 tax return online This certain age must be the same for each child, but need not be a whole number of years. 2005 tax return online In all other situations, reductions in payments are not treated as clearly associated with the happening of a contingency relating to your child. 2005 tax return online   Either you or the IRS can overcome the presumption in the two situations above. 2005 tax return online This is done by showing that the time at which the payments are to be reduced was determined independently of any contingencies relating to your children. 2005 tax return online For example, if you can show that the period of alimony payments is customary in the local jurisdiction, such as a period equal to one-half of the duration of the marriage, you can overcome the presumption and may be able to treat the amount as alimony. 2005 tax return online How To Deduct Alimony Paid You can deduct alimony you paid, whether or not you itemize deductions on your return. 2005 tax return online You must file Form 1040. 2005 tax return online You cannot use Form 1040A or Form 1040EZ. 2005 tax return online Enter the amount of alimony you paid on Form 1040, line 31a. 2005 tax return online In the space provided on line 31b, enter your spouse's social security number (SSN) or individual taxpayer identification number (ITIN). 2005 tax return online If you paid alimony to more than one person, enter the SSN or ITIN of one of the recipients. 2005 tax return online Show the SSN or ITIN and amount paid to each other recipient on an attached statement. 2005 tax return online Enter your total payments on line 31a. 2005 tax return online You must provide your spouse's SSN or ITIN. 2005 tax return online If you do not, you may have to pay a $50 penalty and your deduction may be disallowed. 2005 tax return online For more information on SSNs and ITINs, see Social Security Number (SSN) in chapter 1. 2005 tax return online How To Report Alimony Received Report alimony you received as income on Form 1040, line 11. 2005 tax return online You cannot use Form 1040A or Form 1040EZ. 2005 tax return online You must give the person who paid the alimony your SSN or ITIN. 2005 tax return online If you do not, you may have to pay a $50 penalty. 2005 tax return online Recapture Rule If your alimony payments decrease or end during the first 3 calendar years, you may be subject to the recapture rule. 2005 tax return online If you are subject to this rule, you have to include in income in the third year part of the alimony payments you previously deducted. 2005 tax return online Your spouse can deduct in the third year part of the alimony payments he or she previously included in income. 2005 tax return online The 3-year period starts with the first calendar year you make a payment qualifying as alimony under a decree of divorce or separate maintenance or a written separation agreement. 2005 tax return online Do not include any time in which payments were being made under temporary support orders. 2005 tax return online The second and third years are the next 2 calendar years, whether or not payments are made during those years. 2005 tax return online The reasons for a reduction or end of alimony payments that can require a recapture include: A change in your divorce or separation instrument, A failure to make timely payments, A reduction in your ability to provide support, or A reduction in your spouse's support needs. 2005 tax return online When to apply the recapture rule. 2005 tax return online   You are subject to the recapture rule in the third year if the alimony you pay in the third year decreases by more than $15,000 from the second year or the alimony you pay in the second and third years decreases significantly from the alimony you pay in the first year. 2005 tax return online   When you figure a decrease in alimony, do not include the following amounts. 2005 tax return online Payments made under a temporary support order. 2005 tax return online Payments required over a period of at least 3 calendar years that vary because they are a fixed part of your income from a business or property, or from compensation for employment or self-employment. 2005 tax return online Payments that decrease because of the death of either spouse or the remarriage of the spouse receiving the payments before the end of the third year. 2005 tax return online Figuring the recapture. 2005 tax return online   You can use Worksheet 1 in Publication 504 to figure recaptured alimony. 2005 tax return online Including the recapture in income. 2005 tax return online   If you must include a recapture amount in income, show it on Form 1040, line 11 (“Alimony received”). 2005 tax return online Cross out “received” and enter “recapture. 2005 tax return online ” On the dotted line next to the amount, enter your spouse's last name and SSN or ITIN. 2005 tax return online Deducting the recapture. 2005 tax return online   If you can deduct a recapture amount, show it on Form 1040, line 31a (“Alimony paid”). 2005 tax return online Cross out “paid” and enter “recapture. 2005 tax return online ” In the space provided, enter your spouse's SSN or ITIN. 2005 tax return online Prev  Up  Next   Home   More Online Publications

Internal Revenue Bulletin:  2014-9 

February 24, 2014 

Notice 2014–10

Section 5000A Transition Relief for Individuals with Certain Government-Sponsored Limited-Benefit Health Coverage


This notice provides relief from the individual shared responsibility payment required under § 5000A of the Internal Revenue Code for months in 2014 in which individuals have, under Medicaid and chapter 55 of Title 10, U.S.C., limited-benefit health coverage that is not minimum essential coverage.

BACKGROUND

For each month beginning after December 31, 2013, § 5000A requires individuals to either maintain minimum essential coverage for themselves and any nonexempt family members, qualify for an exemption, or include an individual shared responsibility payment with their Federal income tax return. A taxpayer is liable under § 5000A for any nonexempt individual whom the taxpayer may claim as a dependent.

Under § 5000A(f)(1)(A), minimum essential coverage includes coverage under certain specified government-sponsored programs (“government-sponsored minimum essential coverage”). On August 30, 2013, the Treasury Department and the Internal Revenue Service (IRS) published final regulations under § 5000A. The final regulations provide that government-sponsored minimum essential coverage includes coverage under the Medicaid program under Title XIX of the Social Security Act (42 U.S.C. 1396 and following sections), other than the following limited coverage under Medicaid:

optional coverage of family planning services under section 1902(a)(10)(A)(ii)(XXI) of the Social Security Act (42 U.S.C. 1396a(a)(10)(A)(ii)(XXI)) (“family planning services Medicaid”), optional coverage of tuberculosis-related services under section 1902(a)(10)(A)(ii)(XII) of the Social Security Act (42 U.S.C. 1396a(a)(10)(A)(ii)(XII) (“tuberculosis-related services Medicaid”), coverage of pregnancy-related services under section 1902(a)(10)(A)(i)(IV) and (a)(10)(A)(ii)(IX) of the Social Security Act (42 U.S.C. 1396a(a)(10)(A)(i)(IV), (a)(10)(A)(ii)(IX)) (“pregnancy-related Medicaid”), and coverage limited to treatment of emergency medical conditions in accordance with 8 U.S.C. 1611(b)(1)(A), as authorized by section 1903(v) of the Social Security Act (42 U.S.C. 1396b(v)) (“emergency medical conditions Medicaid”). The final § 5000A regulations also provide that government-sponsored minimum essential coverage includes medical coverage under chapter 55 of Title 10, U.S.C., including coverage under the TRICARE program.

The final § 5000A regulations reserve on whether certain government-sponsored programs that provide limited benefits are minimum essential coverage, including (i) coverage authorized under section 1115 of the Social Security Act (“Section 1115 demonstration projects”); (ii) coverage for medically needy individuals, see section 1902(a)(10)(C) of the Social Security Act (42 U.S.C. 1396a(a)(10)(C)) and 42 CFR 435.300 and following sections; (iii) coverage under section 1079(a), 1086(c)(1), or 1086(d)(1) of Title 10, U.S.C., for certain individuals who are excluded from TRICARE coverage for health care services from private sector providers and only eligible for space available care in a facility for the uniformed services (“space available care”); and (iv) coverage under sections 1074a and 1074b of Title 10, U.S.C., for individuals not on active duty who are entitled to episodic care for an injury, illness, or disease incurred or aggravated in the line of duty (“line-of-duty care”). See § 1.5000A–2(b)(2) (78 FR 53646, 53658).

The preamble to the final § 5000A regulations indicates that future guidance will provide that the government-sponsored limited-benefit coverage reserved on in the final § 5000A regulations is not minimum essential coverage. However, the preamble to the final § 5000A regulations also indicates that, if future rulemaking clarifies that such limited-benefit coverage is not minimum essential coverage, individuals with that coverage for a month in 2014 will not be subject to the § 5000A individual shared responsibility payment for that month. See T.D. 9632 (78 FR 53646, 53648–53650).

Proposed regulations (REG–141036–13) published concurrently with this notice provide that coverage under certain Section 1115 demonstration projects authorized under section 1115(a)(2) of the Social Security Act (42 U.S.C. 1315(a)(2)), coverage for medically needy individuals, space available care, and line-of-duty care is not government-sponsored minimum essential coverage.

DISCUSSION

Individuals enrolled in family planning services Medicaid, tuberculosis-related services Medicaid, pregnancy-related Medicaid, emergency medical conditions Medicaid, certain Section 1115 demonstration projects, coverage for medically needy individuals, space available care, or line-of-duty care may not know when enrolling for the 2014 coverage year that such coverage is not minimum essential coverage. Accordingly, to provide relief to individuals in this situation (or to taxpayers who are liable under § 5000A for other individuals in this situation), and consistent with the preamble to the final regulations, the § 5000A shared responsibility payment is not imposed with respect to an individual for months in 2014 when the individual has coverage under family planning services Medicaid, tuberculosis-related services Medicaid, pregnancy-related Medicaid, emergency medical conditions Medicaid, a Section 1115 demonstration project authorized under section 1115(a)(2) of the Social Security Act (42 U.S.C. 1315(a)(2)), coverage for medically needy individuals, space available care, or line-of-duty care.

The relief provided by this notice applies only for determining a taxpayer’s § 5000A individual shared responsibility payment for not maintaining minimum essential coverage in 2014. Solely for the purpose of determining whether a period without coverage qualifies as a short coverage gap described in § 5000A(e)(4), an individual will be treated as having minimum essential coverage for any month in 2014 when that individual is eligible for the transition relief provided by this notice.

DRAFTING INFORMATION

The principal author of this notice is John B. Lovelace of the Office of Associate Chief Counsel (Income Tax & Accounting). For further information regarding this notice contact Mr. Lovelace at (202) 317-7006 (not a toll-free number).


More Internal Revenue Bulletins

The 2005 Tax Return Online

2005 tax return online Publication 536 - Main Content Table of Contents NOL Steps How To Figure an NOLNonbusiness deductions (line 6). 2005 tax return online Nonbusiness income (line 7). 2005 tax return online Nonbusiness capital losses. 2005 tax return online Business capital losses. 2005 tax return online Illustrated Form 1045, Schedule A When To Use an NOLExceptions to 2-Year Carryback Rule Waiving the Carryback Period How To Carry an NOL Back or Forward How To Claim an NOL DeductionDeducting a Carryback Deducting a Carryforward Change in Marital Status Change in Filing Status Illustrated Form 1045 How To Figure an NOL CarryoverIllustrated Form 1045, Schedule B NOL Carryover From 2013 to 2014Worksheet Instructions How To Get Tax HelpLow Income Taxpayer Clinics NOL Steps Follow Steps 1 through 5 to figure and use your NOL. 2005 tax return online Step 1. 2005 tax return online   Complete your tax return for the year. 2005 tax return online You may have an NOL if a negative figure appears on the line below: Individuals — Form 1040, line 41, or Form 1040NR, line 39. 2005 tax return online Estates and trusts — Form 1041, line 22. 2005 tax return online   If the amount on that line is not negative, stop here — you do not have an NOL. 2005 tax return online Step 2. 2005 tax return online   Determine whether you have an NOL and its amount. 2005 tax return online See How To Figure an NOL , later. 2005 tax return online If you do not have an NOL, stop here. 2005 tax return online Step 3. 2005 tax return online   Decide whether to carry the NOL back to a past year or to waive the carryback period and instead carry the NOL forward to a future year. 2005 tax return online See When To Use an NOL , later. 2005 tax return online Step 4. 2005 tax return online   Deduct the NOL in the carryback or carryforward year. 2005 tax return online See How To Claim an NOL Deduction , later. 2005 tax return online If your NOL deduction is equal to or less than your taxable income without the deduction, stop here — you have used up your NOL. 2005 tax return online Step 5. 2005 tax return online   Determine the amount of your unused NOL. 2005 tax return online See How To Figure an NOL Carryover , later. 2005 tax return online Carry over the unused NOL to the next carryback or carryforward year and begin again at Step 4. 2005 tax return online Note. 2005 tax return online   If your NOL deduction includes more than one NOL amount, apply Step 5 separately to each NOL amount, starting with the amount from the earliest year. 2005 tax return online How To Figure an NOL If your deductions for the year are more than your income for the year, you may have an NOL. 2005 tax return online There are rules that limit what you can deduct when figuring an NOL. 2005 tax return online In general, the following items are not allowed when figuring an NOL. 2005 tax return online Any deduction for personal exemptions. 2005 tax return online Capital losses in excess of capital gains. 2005 tax return online The section 1202 exclusion of the gain from the sale or exchange of qualified small business stock. 2005 tax return online Nonbusiness deductions in excess of nonbusiness income. 2005 tax return online The net operating loss deduction. 2005 tax return online The domestic production activities deduction. 2005 tax return online Form 1045, Schedule A. 2005 tax return online   Use Form 1045, Schedule A, to figure an NOL. 2005 tax return online The following discussion explains Schedule A and includes an illustrated example. 2005 tax return online   First, complete Form 1045, Schedule A, line 1, using amounts from your return. 2005 tax return online If line 1 is a negative amount, you may have an NOL. 2005 tax return online   Next, complete the rest of Form 1045, Schedule A, to figure your NOL. 2005 tax return online Nonbusiness deductions (line 6). 2005 tax return online   Enter on line 6 deductions that are not connected to your trade or business or your employment. 2005 tax return online Examples of deductions not related to your trade or business are: Alimony paid, Deductions for contributions to an IRA or a self-employed retirement plan, Health savings account deduction, Archer medical savings account deduction, Most itemized deductions (except for casualty and theft losses, state income tax on trade and business income, and any employee business expenses), and The standard deduction. 2005 tax return online   Do not include on line 6 the deduction for personal exemptions for you, your spouse, or your dependents. 2005 tax return online   Do not enter business deductions on line 6. 2005 tax return online These are deductions that are connected to your trade or business. 2005 tax return online They include the following. 2005 tax return online State income tax on income attributable to trade or business (including wages, salary, and unemployment compensation). 2005 tax return online Moving expenses. 2005 tax return online Educator expenses. 2005 tax return online The deduction for the deductible part of self-employed health insurance. 2005 tax return online Domestic production activities deduction. 2005 tax return online Rental losses. 2005 tax return online Loss on the sale or exchange of business real estate or depreciable property. 2005 tax return online Your share of a business loss from a partnership or an S corporation. 2005 tax return online Ordinary loss on the sale or exchange of stock in a small business corporation or a small business investment company. 2005 tax return online If you itemize your deductions, casualty and theft losses (even if they involve nonbusiness property) and employee business expenses (such as union dues, uniforms, tools, education expenses, and travel and transportation expenses). 2005 tax return online Loss on the sale of accounts receivable (if you use an accrual method of accounting). 2005 tax return online Interest and litigation expenses on state and federal income taxes related to your business. 2005 tax return online Unrecovered investment in a pension or annuity claimed on a decedent's final return. 2005 tax return online Payment by a federal employee to buy back sick leave used in an earlier year. 2005 tax return online Nonbusiness income (line 7). 2005 tax return online   Enter on line 7 only income that is not related to your trade or business or your employment. 2005 tax return online For example, enter your annuity income, dividends, and interest on investments. 2005 tax return online Also, include your share of nonbusiness income from partnerships and S corporations. 2005 tax return online   Do not include on line 7 the income you receive from your trade or business or your employment. 2005 tax return online This includes salaries and wages, self-employment income, unemployment compensation included in your gross income, and your share of business income from partnerships and S corporations. 2005 tax return online Also, do not include rental income or ordinary gain from the sale or other disposition of business real estate or depreciable business property. 2005 tax return online Adjustment for section 1202 exclusion (line 17). 2005 tax return online   Enter on line 17 any gain you excluded under section 1202 on the sale or exchange of qualified small business stock. 2005 tax return online Adjustments for capital losses (lines 19–22). 2005 tax return online   The amount deductible for capital losses is limited based on whether the losses are business capital losses or nonbusiness capital losses. 2005 tax return online Nonbusiness capital losses. 2005 tax return online   You can deduct your nonbusiness capital losses (line 2) only up to the amount of your nonbusiness capital gains without regard to any section 1202 exclusion (line 3). 2005 tax return online If your nonbusiness capital losses are more than your nonbusiness capital gains without regard to any section 1202 exclusion, you cannot deduct the excess. 2005 tax return online Business capital losses. 2005 tax return online   You can deduct your business capital losses (line 11) only up to the total of: Your nonbusiness capital gains that are more than the total of your nonbusiness capital losses and excess nonbusiness deductions (line 10), and Your total business capital gains without regard to any section 1202 exclusion (line 12). 2005 tax return online Domestic production activities deduction (line 23). 2005 tax return online   You cannot take the domestic production activities deduction when figuring your NOL. 2005 tax return online Enter on line 23 any domestic production activities deduction claimed on your return. 2005 tax return online NOLs from other years (line 24). 2005 tax return online   You cannot deduct any NOL carryovers or carrybacks from other years. 2005 tax return online Enter the total amount of your NOL deduction for losses from other years. 2005 tax return online Illustrated Form 1045, Schedule A The following example illustrates how to figure an NOL. 2005 tax return online It includes filled-in pages 1 and 2 of Form 1040 and Form 1045, Schedule A. 2005 tax return online Example. 2005 tax return online Glenn Johnson is in the retail record business. 2005 tax return online He is single and has the following income and deductions on his Form 1040 for 2013. 2005 tax return online See the illustrated Form 1040 , later. 2005 tax return online INCOME   Wages from part-time job $1,225 Interest on savings 425 Net long-term capital gain on sale of real estate used in business 2,000 Glenn's total income $3,650 DEDUCTIONS   Net loss from business (gross income of $67,000 minus expenses of $72,000) $5,000 Net short-term capital loss on sale of stock 1,000 Standard deduction 6,100 Personal exemption 3,900 Glenn's total deductions $16,000 Glenn's deductions exceed his income by $12,350 ($16,000 − $3,650). 2005 tax return online However, to figure whether he has an NOL, certain deductions are not allowed. 2005 tax return online He uses Form 1045, Schedule A, to figure his NOL. 2005 tax return online See the Illustrated Form 1045, Schedule A , later. 2005 tax return online The following items are not allowed on Form 1045, Schedule A. 2005 tax return online Nonbusiness net short-term capital loss $1,000 Nonbusiness deductions (standard deduction, $6,100) minus nonbusiness income (interest, $425) 5,675 Deduction for personal exemption 3,900 Total adjustments to net loss $10,575     Therefore, Glenn's NOL for 2013 is figured as follows: Glenn's total 2013 income $3,650 Less:     Glenn's original 2013 total deductions $16,000   Reduced by the disallowed items − 10,575 − 5,425 Glenn's NOL for 2013 $1,775 This image is too large to be displayed in the current screen. 2005 tax return online Please click the link to view the image. 2005 tax return online Form 1040, page 1 This image is too large to be displayed in the current screen. 2005 tax return online Please click the link to view the image. 2005 tax return online Form 1040, page 2 This image is too large to be displayed in the current screen. 2005 tax return online Please click the link to view the image. 2005 tax return online Form 1045, page 2 When To Use an NOL Generally, if you have an NOL for a tax year ending in 2013, you must carry back the entire amount of the NOL to the 2 tax years before the NOL year (the carryback period), and then carry forward any remaining NOL for up to 20 years after the NOL year (the carryforward period). 2005 tax return online You can, however, choose not to carry back an NOL and only carry it forward. 2005 tax return online See Waiving the Carryback Period , later. 2005 tax return online You cannot deduct any part of the NOL remaining after the 20-year carryforward period. 2005 tax return online NOL year. 2005 tax return online   This is the year in which the NOL occurred. 2005 tax return online Exceptions to 2-Year Carryback Rule Eligible losses, farming losses, qualified disaster losses, and specified liability losses, all defined next, qualify for longer carryback periods. 2005 tax return online Eligible loss. 2005 tax return online   The carryback period for eligible losses is 3 years. 2005 tax return online Only the eligible loss portion of the NOL can be carried back 3 years. 2005 tax return online An eligible loss is any part of an NOL that: Is from a casualty or theft, or Is attributable to a federally declared disaster for a qualified small business or certain qualified farming businesses. 2005 tax return online Qualified small business. 2005 tax return online   A qualified small business is a sole proprietorship or a partnership that has average annual gross receipts (reduced by returns and allowances) of $5 million or less during the 3-year period ending with the tax year of the NOL. 2005 tax return online If the business did not exist for this entire 3-year period, use the period the business was in existence. 2005 tax return online   An eligible loss does not include a farming loss or a qualified disaster loss. 2005 tax return online Farming loss. 2005 tax return online   The carryback period for a farming loss is 5 years. 2005 tax return online Only the farming loss portion of the NOL can be carried back 5 years. 2005 tax return online A farming loss is the smaller of: The amount that would be the NOL for the tax year if only income and deductions attributable to farming businesses were taken into account, or The NOL for the tax year. 2005 tax return online Farming business. 2005 tax return online   A farming business is a trade or business involving cultivation of land or the raising or harvesting of any agricultural or horticultural commodity. 2005 tax return online A farming business can include operating a nursery or sod farm or raising or harvesting most ornamental trees or trees bearing fruit, nuts, or other crops. 2005 tax return online The raising, shearing, feeding, caring for, training, and management of animals is also considered a farming business. 2005 tax return online   A farming business does not include contract harvesting of an agricultural or horticultural commodity grown or raised by someone else. 2005 tax return online It also does not include a business in which you merely buy or sell plants or animals grown or raised entirely by someone else. 2005 tax return online Waiving the 5-year carryback. 2005 tax return online   You can choose to figure the carryback period for a farming loss without regard to the special 5-year carryback rule. 2005 tax return online To make this choice for 2013, attach to your 2013 income tax return filed by the due date (including extensions) a statement that you are choosing to treat any 2013 farming losses without regard to the special 5-year carryback rule. 2005 tax return online If you filed your original return on time but did not file the statement with it, you can make this choice on an amended return filed within 6 months after the due date of the return (excluding extensions). 2005 tax return online Attach an election statement to your amended return, and write “Filed pursuant to section 301. 2005 tax return online 9100-2” at the top of the statement. 2005 tax return online Once made, this choice is irrevocable. 2005 tax return online Qualified disaster loss. 2005 tax return online   The carryback period for a qualified disaster loss is 5 years. 2005 tax return online Only the qualified disaster loss portion of the NOL can be carried back 5 years. 2005 tax return online A qualified disaster loss is the smaller of: The sum of: Any losses attributable to a federally declared disaster and occurring before January 1, 2010, in the disaster area, plus Any allowable qualified disaster expenses (even if you did not choose to treat those expenses as deductions in the current year), or The NOL for the tax year. 2005 tax return online Qualified disaster expenses. 2005 tax return online   A qualified disaster expense is any capital expense paid or incurred in connection with a trade or business or with business-related property which is: For the abatement or control of hazardous substances that were released as a result of a federally declared disaster occurring before January 1, 2010, For the removal of debris from, or the demolition of structures on, real property which is business-related property damaged or destroyed as a result of a federally declared disaster occurring before January 1, 2010, or For the repair of business-related property damaged as a result of a federally declared disaster occurring before January 1, 2010. 2005 tax return online Business-related property is property held for use in a trade or business, property held for the production of income, or inventory property. 2005 tax return online Note. 2005 tax return online Section 198A allows taxpayers to treat certain capital expenses (qualified disaster expenses) as deductions in the year the expenses were paid or incurred. 2005 tax return online Excluded losses. 2005 tax return online   A qualified disaster loss does not include any losses from property used in connection with any private or commercial golf course, country club, massage parlor, hot tub facility, suntan facility, or any store for which the principal business is the sale of alcoholic beverages for consumption off premises. 2005 tax return online   A qualified disaster loss also does not include any losses from any gambling or animal racing property. 2005 tax return online Gambling or animal racing property is any equipment, furniture, software, or other property used directly in connection with gambling, the racing of animals, or the on-site viewing of such racing, and the portion of any real property (determined by square footage) that is dedicated to gambling, the racing of animals, or the on-site viewing of such racing, unless this portion is less than 100 square feet. 2005 tax return online Specified liability loss. 2005 tax return online   The carryback period for a specified liability loss is 10 years. 2005 tax return online Only the specified liability loss portion of the NOL can be carried back 10 years. 2005 tax return online Generally, a specified liability loss is a loss arising from: Product liability and expenses incurred in the investigation or settlement of, or opposition to, product liability claims, or An act (or failure to act) that occurred at least 3 years before the beginning of the loss year and resulted in a liability under a federal or state law requiring: Reclamation of land, Dismantling of a drilling platform, Remediation of environmental contamination, or Payment under any workers compensation act. 2005 tax return online   Any loss from a liability arising from (1) through (4) above can be taken into account as a specified liability loss only if you used an accrual method of accounting throughout the period in which the act (or failure to act) occurred. 2005 tax return online For details, see section 172(f). 2005 tax return online Waiving the 10-year carryback. 2005 tax return online   You can choose to figure the carryback period for a specified liability loss without regard to the special 10-year carryback rule. 2005 tax return online To make this choice for 2013 attach to your 2013 income tax return filed by the due date (including extensions) a statement that you are choosing to treat any 2013 specified liability losses without regard to the special 10-year carryback rule. 2005 tax return online If you filed your original return on time but did not file the statement with it, you can make this choice on an amended return filed within 6 months after the due date of the return (excluding extensions). 2005 tax return online Attach a statement to your amended return and write “Filed pursuant to section 301. 2005 tax return online 9100-2” at the top of the statement. 2005 tax return online Once made, this choice is irrevocable. 2005 tax return online Waiving the Carryback Period You can choose not to carry back your NOL. 2005 tax return online If you make this choice, then you can use your NOL only in the 20-year carryforward period. 2005 tax return online (This choice means you also choose not to carry back any alternative tax NOL. 2005 tax return online ) To make this choice, attach a statement to your original return filed by the due date (including extensions) for the NOL year. 2005 tax return online This statement must show that you are choosing to waive the carryback period under section 172(b)(3). 2005 tax return online If you filed your original return on time but did not file the statement with it, you can make this choice on an amended return filed within 6 months of the due date of the return (excluding extensions). 2005 tax return online Attach a statement to your amended return, and write “Filed pursuant to section 301. 2005 tax return online 9100-2” at the top of the statement. 2005 tax return online Once you choose to waive the carryback period, it generally is irrevocable. 2005 tax return online If you choose to waive the carryback period for more than one NOL, you must make a separate choice and attach a separate statement for each NOL year. 2005 tax return online If you do not file this statement on time, you cannot waive the carryback period. 2005 tax return online How To Carry an NOL Back or Forward If you choose to carry back the NOL, you must first carry the entire NOL to the earliest carryback year. 2005 tax return online If your NOL is not used up, you can carry the rest to the next earliest carryback year, and so on. 2005 tax return online If you waive the carryback period or do not use up the NOL in the carryback period, carry forward what remains of the NOL to the 20 tax years following the NOL year. 2005 tax return online Start by carrying it to the first tax year after the NOL year. 2005 tax return online If you do not use it up, carry the unused part to the next year. 2005 tax return online Continue to carry any unused part of the NOL forward until the NOL is used up or you complete the 20-year carryforward period. 2005 tax return online Example 1. 2005 tax return online You started your business as a sole proprietor in 2013 and had a $42,000 NOL for the year. 2005 tax return online No part of the NOL qualifies for the 3-year, 5-year, or 10-year carryback. 2005 tax return online You begin using your NOL in 2011, the second year before the NOL year, as shown in the following chart. 2005 tax return online Year   Carryback/  Carryover Unused  Loss 2011 $42,000 $40,000 2012 40,000 37,000 2013 (NOL year)     2014 37,000 31,500 2015 31,500 22,500 2016 22,500 12,700 2017 12,700 4,000 2018 4,000 -0- If your loss were larger, you could carry it forward until the year 2033. 2005 tax return online If you still had an unused 2013 carryforward after the year 2033, you would not be allowed to deduct it. 2005 tax return online Example 2. 2005 tax return online Assume the same facts as in Example 1 , except that $4,000 of the NOL is attributable to a casualty loss and this loss qualifies for a 3-year carryback period. 2005 tax return online You begin using the $4,000 in 2010. 2005 tax return online As shown in the following chart, $3,000 of this NOL is used in 2010. 2005 tax return online The remaining $1,000 is carried to 2011 with the $38,000 NOL that you must begin using in 2011. 2005 tax return online Year   Carryback/  Carryover Unused  Loss 2010 $4,000 $1,000 2011 39,000 37,000 2012 37,000 34,000 2013 (NOL year)     2014 34,000 28,500 2015 28,500 19,500 2016 19,500 9,700 2017 9,700 1,000 2018 1,000 -0- How To Claim an NOL Deduction If you have not already carried the NOL to an earlier year, your NOL deduction is the total NOL. 2005 tax return online If you carried the NOL to an earlier year, your NOL deduction is the carried over NOL minus the NOL amount you used in the earlier year or years. 2005 tax return online If you carry more than one NOL to the same year, your NOL deduction is the total of these carrybacks and carryovers. 2005 tax return online NOL resulting in no taxable income. 2005 tax return online   If your NOL is more than the taxable income of the year you carry it to (figured before deducting the NOL), you generally will have an NOL carryover to the next year. 2005 tax return online See How To Figure an NOL Carryover , later, to determine how much NOL you have used and how much you carry to the next year. 2005 tax return online Deducting a Carryback If you carry back your NOL, you can use either Form 1045 or Form 1040X. 2005 tax return online You can get your refund faster by using Form 1045, but you have a shorter time to file it. 2005 tax return online You can use Form 1045 to apply an NOL to all carryback years. 2005 tax return online If you use Form 1040X, you must use a separate Form 1040X for each carryback year to which you apply the NOL. 2005 tax return online Estates and trusts that do not file Form 1045 must file an amended Form 1041 (instead of Form 1040X) for each carryback year to which NOLs are applied. 2005 tax return online Use a copy of the appropriate year's Form 1041, check the “Amended return” box, and follow the Form 1041 instructions for amended returns. 2005 tax return online Include the NOL deduction with other deductions not subject to the 2% limit (line 15a). 2005 tax return online Also, see the special procedures for filing an amended return due to an NOL carryback, explained under Form 1040X , later. 2005 tax return online Form 1045. 2005 tax return online   You can apply for a quick refund by filing Form 1045. 2005 tax return online This form results in a tentative adjustment of tax in the carryback year. 2005 tax return online See the Illustrated Form 1045 . 2005 tax return online at the end of this discussion. 2005 tax return online   If the IRS refunds or credits an amount to you from Form 1045 and later determines that the refund or credit is too much, the IRS may assess and collect the excess immediately. 2005 tax return online   Generally, you must file Form 1045 on or after the date you file your tax return for the NOL year, but not later than one year after the end of the NOL year. 2005 tax return online If the last day of the NOL year falls on a Saturday, Sunday, or holiday, the form will be considered timely if postmarked on the next business day. 2005 tax return online For example, if you are a calendar year taxpayer with a carryback from 2013 to 2011, you must file Form 1045 on or after the date you file your tax return for 2013, but no later than December 31, 2014. 2005 tax return online Form 1040X. 2005 tax return online   If you do not file Form 1045, you can file Form 1040X to get a refund of tax because of an NOL carryback. 2005 tax return online File Form 1040X within 3 years after the due date, including extensions, for filing the return for the NOL year. 2005 tax return online For example, if you are a calendar year taxpayer and filed your 2011 return by the April 15, 2012, due date, you must file a claim for refund of 2008 tax because of an NOL carryback from 2011 by April 15, 2015. 2005 tax return online   Attach a computation of your NOL using Form 1045, Schedule A, and, if it applies, your NOL carryover using Form 1045, Schedule B, discussed later . 2005 tax return online Refiguring your tax. 2005 tax return online   To refigure your total tax liability for a carryback year, first refigure your adjusted gross income for that year. 2005 tax return online (On Form 1045, use lines 10 and 11 and the “After carryback” column for the applicable carryback year. 2005 tax return online ) Use your adjusted gross income after applying the NOL deduction to refigure income or deduction items that are based on, or limited to, a percentage of your adjusted gross income. 2005 tax return online Refigure the following items. 2005 tax return online The special allowance for passive activity losses from rental real estate activities. 2005 tax return online Taxable social security and tier 1 railroad retirement benefits. 2005 tax return online IRA deductions. 2005 tax return online Excludable savings bond interest. 2005 tax return online Excludable employer-provided adoption benefits. 2005 tax return online The student loan interest deduction. 2005 tax return online The tuition and fees deduction. 2005 tax return online   If more than one of these items apply, refigure them in the order listed above, using your adjusted gross income after applying the NOL deduction and any previous item. 2005 tax return online (Enter your NOL deduction on Form 1045, line 10. 2005 tax return online On line 11, using the “After carryback” column, enter your adjusted gross income refigured after applying the NOL deduction and after refiguring any above items. 2005 tax return online )   Next, refigure your taxable income. 2005 tax return online (On Form 1045, use lines 12 through 15 and the “After carryback” column. 2005 tax return online ) Use your refigured adjusted gross income (Form 1045, line 11, using the “After carryback” column) to refigure certain deductions and other items that are based on or limited to a percentage of your adjusted gross income. 2005 tax return online Refigure the following items. 2005 tax return online The itemized deduction for medical expenses. 2005 tax return online The itemized deduction for qualified mortgage insurance premiums. 2005 tax return online The itemized deduction for casualty losses. 2005 tax return online Miscellaneous itemized deductions subject to the 2% limit. 2005 tax return online The overall limit on itemized deductions (do not apply to carryback years beginning after December 31, 2009). 2005 tax return online The phaseout of the deduction for exemptions (do not apply to carryback years beginning after December 31, 2009). 2005 tax return online Qualified motor vehicle tax (do not apply to carryback years beginning after December 31, 2009). 2005 tax return online    Do not refigure the itemized deduction for charitable contributions. 2005 tax return online   Finally, use your refigured taxable income (Form 1045, line 15, using the “After carryback” column) to refigure your total tax liability. 2005 tax return online Refigure your income tax, your alternative minimum tax, and any credits that are based on or limited by your adjusted gross income (AGI), modified adjusted gross income (MAGI), or tax liability. 2005 tax return online (On Form 1045, use lines 16 through 25, and the “After carryback” column. 2005 tax return online ) The earned income credit, for example, may be affected by changes to adjusted gross income or the amount of tax (or both) and, therefore, must be recomputed. 2005 tax return online If you become eligible for a credit because of the carryback, complete the form for that specific credit (such as the EIC Worksheet) for that year. 2005 tax return online   While it is necessary to refigure your income tax, alternative minimum tax, and credits, do not refigure your self-employment tax. 2005 tax return online Deducting a Carryforward If you carry forward your NOL to a tax year after the NOL year, list your NOL deduction as a negative figure on the “Other income” line of Form 1040 or Form 1040NR (line 21 for 2013). 2005 tax return online Estates and trusts include an NOL deduction on Form 1041 with other deductions not subject to the 2% limit (line 15a for 2013). 2005 tax return online You must attach a statement that shows all the important facts about the NOL. 2005 tax return online Your statement should include a computation showing how you figured the NOL deduction. 2005 tax return online If you deduct more than one NOL in the same year, your statement must cover each of them. 2005 tax return online Change in Marital Status If you and your spouse were not married to each other in all years involved in figuring NOL carrybacks and carryovers, only the spouse who had the loss can take the NOL deduction. 2005 tax return online If you file a joint return, the NOL deduction is limited to the income of that spouse. 2005 tax return online For example, if your marital status changes because of death or divorce, and in a later year you have an NOL, you can carry back that loss only to the part of the income reported on the joint return (filed with your former spouse) that was related to your taxable income. 2005 tax return online After you deduct the NOL in the carryback year, the joint rates apply to the resulting taxable income. 2005 tax return online Refund limit. 2005 tax return online   If you are not married in the NOL year (or are married to a different spouse), and in the carryback year you were married and filed a joint return, your refund for the overpaid joint tax may be limited. 2005 tax return online You can claim a refund for the difference between your share of the refigured tax and your contribution toward the tax paid on the joint return. 2005 tax return online The refund cannot be more than the joint overpayment. 2005 tax return online Attach a statement showing how you figured your refund. 2005 tax return online Figuring your share of a joint tax liability. 2005 tax return online   There are five steps for figuring your share of the refigured joint tax liability. 2005 tax return online Figure your total tax as though you had filed as married filing separately. 2005 tax return online Figure your spouse's total tax as though your spouse had also filed as married filing separately. 2005 tax return online Add the amounts in (1) and (2). 2005 tax return online Divide the amount in (1) by the amount in (3). 2005 tax return online Multiply the refigured tax on your joint return by the amount figured in (4). 2005 tax return online This is your share of the joint tax liability. 2005 tax return online Figuring your contribution toward tax paid. 2005 tax return online   Unless you have an agreement or clear evidence of each spouse's contributions toward the payment of the joint tax liability, figure your contribution by adding the tax withheld on your wages and your share of joint estimated tax payments or tax paid with the return. 2005 tax return online If the original return for the carryback year resulted in an overpayment, reduce your contribution by your share of the tax refund. 2005 tax return online Figure your share of a joint payment or refund by the same method used in figuring your share of the joint tax liability. 2005 tax return online Use your taxable income as originally reported on the joint return in steps (1) and (2) above, and substitute the joint payment or refund for the refigured joint tax in step (5). 2005 tax return online Change in Filing Status If you and your spouse were married and filed a joint return for each year involved in figuring NOL carrybacks and carryovers, figure the NOL deduction on a joint return as you would for an individual. 2005 tax return online However, treat the NOL deduction as a joint NOL. 2005 tax return online If you and your spouse were married and filed separate returns for each year involved in figuring NOL carrybacks and carryovers, the spouse who sustained the loss may take the NOL deduction on a separate return. 2005 tax return online Special rules apply for figuring the NOL carrybacks and carryovers of married people whose filing status changes for any tax year involved in figuring an NOL carryback or carryover. 2005 tax return online Separate to joint return. 2005 tax return online   If you and your spouse file a joint return for a carryback or carryforward year, and were married but filed separate returns for any of the tax years involved in figuring the NOL carryback or carryover, treat the separate carryback or carryover as a joint carryback or carryover. 2005 tax return online Joint to separate returns. 2005 tax return online   If you and your spouse file separate returns for a carryback or carryforward year, but filed a joint return for any or all of the tax years involved in figuring the NOL carryover, figure each of your carryovers separately. 2005 tax return online Joint return in NOL year. 2005 tax return online   Figure each spouse's share of the joint NOL through the following steps. 2005 tax return online Figure each spouse's NOL as if he or she filed a separate return. 2005 tax return online See How To Figure an NOL , earlier. 2005 tax return online If only one spouse has an NOL, stop here. 2005 tax return online All of the joint NOL is that spouse's NOL. 2005 tax return online If both spouses have an NOL, multiply the joint NOL by a fraction, the numerator of which is spouse A's NOL figured in (1) and the denominator of which is the total of the spouses' NOLs figured in (1). 2005 tax return online The result is spouse A's share of the joint NOL. 2005 tax return online The rest of the joint NOL is spouse B's share. 2005 tax return online Example 1. 2005 tax return online Mark and Nancy are married and file a joint return for 2013. 2005 tax return online They have an NOL of $5,000. 2005 tax return online They carry the NOL back to 2011, a year in which Mark and Nancy filed separate returns. 2005 tax return online Figured separately, Nancy's 2013 deductions were more than her income, and Mark's income was more than his deductions. 2005 tax return online Mark does not have any NOL to carry back. 2005 tax return online Nancy can carry back the entire $5,000 NOL to her 2011 separate return. 2005 tax return online Example 2. 2005 tax return online Assume the same facts as in Example 1 , except that both Mark and Nancy had deductions in 2013 that were more than their income. 2005 tax return online Figured separately, his NOL is $1,800 and her NOL is $3,000. 2005 tax return online The sum of their separate NOLs ($4,800) is less than their $5,000 joint NOL because his deductions included a $200 net capital loss that is not allowed in figuring his separate NOL. 2005 tax return online The loss is allowed in figuring their joint NOL because it was offset by Nancy's capital gains. 2005 tax return online Mark's share of their $5,000 joint NOL is $1,875 ($5,000 × $1,800/$4,800) and Nancy's is $3,125 ($5,000 − $1,875). 2005 tax return online Joint return in previous carryback or carryforward year. 2005 tax return online   If only one spouse had an NOL deduction on the previous year's joint return, all of the joint carryover is that spouse's carryover. 2005 tax return online If both spouses had an NOL deduction (including separate carryovers of a joint NOL, figured as explained in the previous discussion ), figure each spouse's share of the joint carryover through the following steps. 2005 tax return online Figure each spouse's modified taxable income as if he or she filed a separate return. 2005 tax return online See Modified taxable income under How To Figure an NOL Carryover , later. 2005 tax return online Multiply the joint modified taxable income you used to figure the joint carryover by a fraction, the numerator of which is spouse A's modified taxable income figured in (1) and the denominator of which is the total of the spouses' modified taxable incomes figured in (1). 2005 tax return online This is spouse A's share of the joint modified taxable income. 2005 tax return online Subtract the amount figured in (2) from the joint modified taxable income. 2005 tax return online This is spouse B's share of the joint modified taxable income. 2005 tax return online Reduce the amount figured in (3), but not below zero, by spouse B's NOL deduction. 2005 tax return online Add the amounts figured in (2) and (4). 2005 tax return online Subtract the amount figured in (5) from spouse A's NOL deduction. 2005 tax return online This is spouse A's share of the joint carryover. 2005 tax return online The rest of the joint carryover is spouse B's share. 2005 tax return online Example. 2005 tax return online Sam and Wanda filed a joint return for 2011 and separate returns for 2012 and 2013. 2005 tax return online In 2013, Sam had an NOL of $18,000 and Wanda had an NOL of $2,000. 2005 tax return online They choose to carry back both NOLs 2 years to their 2011 joint return and claim a $20,000 NOL deduction. 2005 tax return online Their joint modified taxable income (MTI) for 2011 is $15,000, and their joint NOL carryover to 2012 is $5,000 ($20,000 – $15,000). 2005 tax return online Sam and Wanda each figure their separate MTI for 2011 as if they had filed separate returns. 2005 tax return online Then they figure their shares of the $5,000 carryover as follows. 2005 tax return online Step 1. 2005 tax return online   Sam's separate MTI $9,000 Wanda's separate MTI + 3,000 Total MTI $12,000 Step 2. 2005 tax return online   Joint MTI $15,000 Sam's MTI ÷ total MTI ($9,000 ÷ $12,000) × . 2005 tax return online 75 Sam's share of joint MTI $11,250 Step 3. 2005 tax return online   Joint MTI $15,000 Sam's share of joint MTI − 11,250 Wanda's share of joint MTI $3,750 Step 4. 2005 tax return online   Wanda's share of joint MTI $3,750 Wanda's NOL deduction − 2,000 Wanda's remaining share $1,750 Step 5. 2005 tax return online   Sam's share of joint MTI $11,250 Wanda's remaining share + 1,750 Joint MTI to be offset $13,000 Step 6. 2005 tax return online   Sam's NOL deduction $18,000 Joint MTI to be offset − 13,000 Sam's carryover to 2012 $5,000 Joint carryover to 2012 $5,000 Sam's carryover − 5,000 Wanda's carryover to 2012 $-0- Wanda's $2,000 NOL deduction offsets $2,000 of her $3,750 share of the joint modified taxable income and is completely used up. 2005 tax return online She has no carryover to 2012. 2005 tax return online Sam's $18,000 NOL deduction offsets all of his $11,250 share of joint modified taxable income and the remaining $1,750 of Wanda's share. 2005 tax return online His carryover to 2012 is $5,000. 2005 tax return online Illustrated Form 1045 The following example illustrates how to use Form 1045 to claim an NOL deduction in a carryback year. 2005 tax return online It includes a filled-in page 1 of Form 1045. 2005 tax return online Example. 2005 tax return online Martha Sanders is a self-employed contractor. 2005 tax return online Martha's 2013 deductions are more than her 2013 income because of a business loss. 2005 tax return online She uses Form 1045 to carry back her NOL 2 years and claim an NOL deduction in 2011. 2005 tax return online Her filing status in both years was single. 2005 tax return online See the filled-in Form 1045 later. 2005 tax return online Martha figures her 2013 NOL on Form 1045, Schedule A (not shown). 2005 tax return online (For an example using Form 1045, Schedule A, see Illustrated Form 1045, Schedule A under How To Figure an NOL , earlier. 2005 tax return online ) She enters the $10,000 NOL from Form 1045, Schedule A, line 25, on Form 1045, line 1a. 2005 tax return online Martha completes lines 10 through 25, using the “Before carryback” column under the column for the second preceding tax year ended 12/31/11 on page 1 of Form 1045 using the following amounts from her 2011 return. 2005 tax return online 2011 Adjusted gross income $50,000 Itemized deductions:     Medical expenses [$6,000 − ($50,000 × 7. 2005 tax return online 5%)] $2,250   State income tax + 2,000   Real estate tax + 4,000   Home mortgage interest + 5,000   Total itemized deductions $13,250 Exemption $3,700 Income tax $4,550 Self-employment tax $6,120   Martha refigures her taxable income for 2011 after carrying back her 2013 NOL as follows: 2011 Adjusted gross income $50,000 Less:     NOL from 2013 −10,000 2011 Adjusted gross income after carryback $40,000 Less:     Itemized deductions:     Medical expenses [$6,000 − ($40,000 × 7. 2005 tax return online 5%)] $3,000   State income tax + 2,000   Real estate tax + 4,000   Home mortgage interest + 5,000   Total itemized deductions −14,000 Less:     Exemption − 3,700 2011 Taxable income after carryback $22,300 Martha then completes lines 10 through 25, using the “After carryback” column under the column for the second preceding tax year ended 12/31/11. 2005 tax return online On line 10, Martha enters her $10,000 NOL deduction. 2005 tax return online Her new adjusted gross income on line 11 is $40,000 ($50,000 − $10,000). 2005 tax return online To complete line 12, she must refigure her medical expense deduction using her new adjusted gross income. 2005 tax return online Her refigured medical expense deduction is $3,000 [$6,000 − ($40,000 × 7. 2005 tax return online 5%)]. 2005 tax return online This increases her total itemized deductions to $14,000 [$13,250 + ($3,000 − $2,250)]. 2005 tax return online Martha uses her refigured taxable income ($22,300) from line 15, and the tax tables in her 2011 Form 1040 instructions to find her income tax. 2005 tax return online She enters the new amount, $2,924, on line 16, and her new total tax liability, $9,044, on line 25. 2005 tax return online Martha used up her $10,000 NOL in 2011 so she does not complete a column for the first preceding tax year ended 12/31/2012. 2005 tax return online The decrease in tax because of her NOL deduction (line 27) is $1,612. 2005 tax return online Martha files Form 1045 after filing her 2013 return, but no later than December 31, 2014. 2005 tax return online She mails it to the Internal Revenue Service Center for the place where she lives as shown in the 2013 instructions for Form 1040 and attaches a copy of her 2013 return (including the applicable forms and schedules). 2005 tax return online This image is too large to be displayed in the current screen. 2005 tax return online Please click the link to view the image. 2005 tax return online Form 1045, page 1 How To Figure an NOL Carryover If your NOL is more than your taxable income for the year to which you carry it (figured before deducting the NOL), you may have an NOL carryover. 2005 tax return online You must make certain modifications to your taxable income to determine how much NOL you will use up in that year and how much you can carry over to the next tax year. 2005 tax return online Your carryover is the excess of your NOL deduction over your modified taxable income for the carryback or carryforward year. 2005 tax return online If your NOL deduction includes more than one NOL, apply the NOLs against your modified taxable income in the same order in which you incurred them, starting with the earliest. 2005 tax return online Modified taxable income. 2005 tax return online   Your modified taxable income is your taxable income figured with the following changes. 2005 tax return online You cannot claim an NOL deduction for the NOL carryover you are figuring or for any later NOL. 2005 tax return online You cannot claim a deduction for capital losses in excess of your capital gains. 2005 tax return online Also, you must increase your taxable income by the amount of any section 1202 exclusion. 2005 tax return online You cannot claim the domestic production activities deduction. 2005 tax return online You cannot claim a deduction for your exemptions for yourself, your spouse, or dependents. 2005 tax return online You must figure any item affected by the amount of your adjusted gross income after making the changes in (1), (2), and (3), above, and certain other changes to your adjusted gross income that result from (1), (2), and (3). 2005 tax return online This includes income and deduction items used to figure adjusted gross income (for example, IRA deductions), as well as certain itemized deductions. 2005 tax return online To figure a charitable contribution deduction, do not include deductions for NOL carrybacks in the change in (1) but do include deductions for NOL carryforwards from tax years before the NOL year. 2005 tax return online   Your taxable income as modified cannot be less than zero. 2005 tax return online Form 1045, Schedule B. 2005 tax return online   You can use Form 1045, Schedule B, to figure your modified taxable income for carryback years and your carryover from each of those years. 2005 tax return online Do not use Form 1045, Schedule B, for a carryforward year. 2005 tax return online If your 2013 return includes an NOL deduction from an NOL year before 2013 that reduced your taxable income to zero (to less than zero, if an estate or trust), see NOL Carryover From 2013 to 2014 , later. 2005 tax return online Illustrated Form 1045, Schedule B The following example illustrates how to figure an NOL carryover from a carryback year. 2005 tax return online It includes a filled-in Form 1045, Schedule B. 2005 tax return online Example. 2005 tax return online Ida Brown runs a small clothing shop. 2005 tax return online In 2013, she has an NOL of $36,000 that she carries back to 2011. 2005 tax return online She has no other carrybacks or carryforwards to 2011. 2005 tax return online Ida's adjusted gross income in 2011 was $35,000, consisting of her salary of $36,000 minus a $1,000 capital loss deduction. 2005 tax return online She is single and claimed only one personal exemption of $3,700. 2005 tax return online During that year, she gave $1,450 in charitable contributions. 2005 tax return online Her medical expenses were $3,000. 2005 tax return online She also deducted $1,650 in taxes and $3,125 in home mortgage interest. 2005 tax return online Her deduction for charitable contributions was not limited because her contributions, $1,450, were less than 50% of her adjusted gross income. 2005 tax return online The deduction for medical expenses was limited to expenses over 7. 2005 tax return online 5% of adjusted gross income (. 2005 tax return online 075 × $35,000 = $2,625; $3,000 − $2,625 = $375). 2005 tax return online The deductions for taxes and home mortgage interest were not subject to any limits. 2005 tax return online She was able to claim $6,600 ($1,450 + $375 + $1,650 + $3,125) in itemized deductions and a personal exemption deduction of $3,700 for 2011. 2005 tax return online She had no other deductions in 2011 (except the NOL deduction). 2005 tax return online Her taxable income (figured without the NOL deduction) for the year was $24,700. 2005 tax return online Ida's adjusted gross income in 2012 was $9,325, consisting of net business income from the clothing shop of $12,325 and a net capital loss of $3,000. 2005 tax return online She did not itemize her deductions in 2012. 2005 tax return online She deducted the standard deduction of $5,950 and the personal exemption deduction of $3,800. 2005 tax return online She had no other deductions in 2012 (other than the NOL deduction). 2005 tax return online Her taxable income, therefore, was ($425). 2005 tax return online Ida's $36,000 carryback will result in her having 2011 taxable income of zero. 2005 tax return online She then completes the column for the second preceding tax year ended 12/31/11 on Form 1045, Schedule B, to figure how much of her NOL she uses up in 2011 and how much she can carry over to 2012. 2005 tax return online She completes the column for the first preceding tax year ended 12/31/12. 2005 tax return online See the illustrated Form 1045, Schedule B , shown later. 2005 tax return online Column 1, line 1. 2005 tax return online Ida enters $36,000, her 2013 net operating loss, on line 1. 2005 tax return online Column 1, line 2. 2005 tax return online She enters $24,700, her 2011 taxable income (figured without the NOL deduction), on line 2. 2005 tax return online Column 1, line 3. 2005 tax return online Ida enters her net capital loss deduction of $1,000 on line 3. 2005 tax return online Column 1, lines 4 and 5. 2005 tax return online Ida had no section 1202 exclusion or domestic production activities deduction in 2011. 2005 tax return online She enters zero on lines 4 and 5. 2005 tax return online Column 1, line 6. 2005 tax return online Although Ida's entry on line 3 modifies her adjusted gross income, that does not affect any other items included in her adjusted gross income. 2005 tax return online Ida enters zero on line 6. 2005 tax return online Column 1, line 7. 2005 tax return online Ida had itemized deductions and entered $1,000 on line 3, so she completes lines 11 through 38 to figure her adjustment to itemized deductions. 2005 tax return online On line 7, she enters the total adjustment from line 38. 2005 tax return online Column 1, line 8. 2005 tax return online Ida enters the deduction for her personal exemption of $3,700 for 2011. 2005 tax return online Column 1, line 9. 2005 tax return online After combining lines 2 through 8, Ida's modified taxable income is $29,475. 2005 tax return online Column 1, line 10. 2005 tax return online Ida figures her carryover to 2012 by subtracting her modified taxable income (line 9) from her NOL deduction (line 1). 2005 tax return online She enters the $6,525 carryover on line 10. 2005 tax return online She also enters the $6,525 as her NOL deduction for 2012 on Form 1045, page 1, line 10, in the “After carryback” column under the column for the first preceding tax year ended 12/31/12. 2005 tax return online (For an illustrated example of page 1 of Form 1045, see Illustrated Form 1045 under How To Claim an NOL Deduction , earlier. 2005 tax return online ) Next, Ida completes column 2 for the first preceding tax year ended 12/31/12. 2005 tax return online Column 1, line 11. 2005 tax return online Ida's adjusted gross income for 2011 was $35,000. 2005 tax return online Column 1, line 12. 2005 tax return online She adds lines 3 through 6 and enters $1,000 on line 12. 2005 tax return online (This is her net capital loss deduction added back, which modifies her adjusted gross income. 2005 tax return online ) Column 1, line 13. 2005 tax return online Her modified adjusted gross income for 2011 is now $36,000. 2005 tax return online Column 1, line 14. 2005 tax return online On her 2011 tax return, she deducted $375 as medical expenses. 2005 tax return online Column 1, line 15. 2005 tax return online Her actual medical expenses were $3,000. 2005 tax return online Column 1, line 16. 2005 tax return online She multiplies her modified adjusted gross income, $36,000, by . 2005 tax return online 075. 2005 tax return online She enters $2,700 on line 16. 2005 tax return online Column 1, line 17. 2005 tax return online She substracts $2,700 from her actual medical expenses, $3,000. 2005 tax return online She enters $300 on line 17. 2005 tax return online This is her modified medical deduction. 2005 tax return online Column 1, line 18. 2005 tax return online The difference between her medical deduction and her modified medical deduction is $75. 2005 tax return online She enters this on line 18. 2005 tax return online Column 1, lines 19 through 21. 2005 tax return online Ida had no deduction for qualified mortgage insurance premiums in 2011. 2005 tax return online She skips lines 19 and 20 and enters zero on line 21. 2005 tax return online Column 1, line 22. 2005 tax return online She enters her modified adjusted gross income of $36,000 on line 22. 2005 tax return online Column 1, line 23. 2005 tax return online She had no other carrybacks to 2011 and enters zero on line 23. 2005 tax return online Column 1, line 24. 2005 tax return online Her modified adjusted gross income remains $36,000. 2005 tax return online Column 1, line 25. 2005 tax return online Her actual contributions for 2011 were $1,450, which she enters on line 25. 2005 tax return online Column 1, line 26. 2005 tax return online She now refigures her charitable contributions based on her modified adjusted gross income. 2005 tax return online Her contributions are well below the 50% limit, so she enters $1,450 on line 26. 2005 tax return online Column 1, line 27. 2005 tax return online The difference is zero. 2005 tax return online Column 1, lines 28 through 37. 2005 tax return online Ida had no casualty losses or deductions for miscellaneous items in 2011. 2005 tax return online She skips lines 28 through 31 and lines 33 through 36. 2005 tax return online Ida enters zero on lines 32 and 37. 2005 tax return online Column 1, line 38. 2005 tax return online She combines lines 18, 21, 27, 32, and 37 and enters $75 on line 38. 2005 tax return online She carries this figure to line 7. 2005 tax return online Column 2, line 1. 2005 tax return online Ida enters $6,525, the carryback of her 2013 NOL to 2012, from column 1, line 10, on line 1. 2005 tax return online Column 2, line 2. 2005 tax return online She enters ($425), her 2012 taxable income, on line 2. 2005 tax return online Column 2, line 3. 2005 tax return online Ida enters her net capital loss deduction of $3,000 on line 3. 2005 tax return online Column 2, lines 4 and 5. 2005 tax return online Ida had no section 1202 exclusion or domestic production activities deduction in 2012. 2005 tax return online She enters zero on lines 4 and 5. 2005 tax return online Column 2, line 6. 2005 tax return online Although Ida's entry on line 3 modifies her adjusted gross income, that does not affect any other items included in her adjusted gross income. 2005 tax return online Ida enters zero on line 6. 2005 tax return online Column 2, line 7. 2005 tax return online Because Ida did not itemize deductions on her 2012 tax return, she enters zero on line 7. 2005 tax return online Column 2, line 8. 2005 tax return online Ida enters the deduction for her personal exemption of $3,800 for 2012. 2005 tax return online Column 2, line 9. 2005 tax return online After combining lines 2 through 8, Ida's modified taxable income is $6,375. 2005 tax return online Column 2, line 10. 2005 tax return online Ida figures her carryforward to 2014 by subtracting her modified taxable income (line 9) from her NOL deduction (line 1). 2005 tax return online She enters the $150 carryover on line 10. 2005 tax return online This image is too large to be displayed in the current screen. 2005 tax return online Please click the link to view the image. 2005 tax return online Form 1045, page 3 This image is too large to be displayed in the current screen. 2005 tax return online Please click the link to view the image. 2005 tax return online Form 1045, page 4 NOL Carryover From 2013 to 2014 If you had an NOL deduction carried forward from a year prior to 2013 that resulted in your having taxable income on your 2013 return of zero (of less than zero, if an estate or trust), complete Table 1 , Worksheet for NOL Carryover From 2013 to 2014, on the following pages. 2005 tax return online It will help you figure your NOL to carry to 2014. 2005 tax return online Keep the worksheet for your records. 2005 tax return online Worksheet Instructions At the top of the worksheet, enter the NOL year for which you are figuring the carryover. 2005 tax return online More than one NOL. 2005 tax return online   If your 2013 NOL deduction includes amounts for more than one loss year, complete this worksheet only for one loss year. 2005 tax return online To determine which year, start with your earliest NOL and subtract each NOL separately from your taxable income figured without the NOL deduction. 2005 tax return online Complete this worksheet for the earliest NOL that results in your having taxable income below zero. 2005 tax return online Your NOL carryover to 2014 is the total of the amount on line 10 of the worksheet and all later NOL amounts. 2005 tax return online Example. 2005 tax return online Your taxable income for 2013 is $5,000 without your $9,000 NOL deduction. 2005 tax return online Your NOL deduction includes a $2,000 carryover from 2011 and a $7,000 carryover from 2012. 2005 tax return online Subtract your 2011 NOL of $2,000 from $5,000. 2005 tax return online This gives you taxable income of $3,000. 2005 tax return online Your 2011 NOL is now completely used up. 2005 tax return online Subtract your $7,000 2012 NOL from $3,000. 2005 tax return online This gives you taxable income of ($4,000). 2005 tax return online You now complete the worksheet for your 2012 NOL. 2005 tax return online Your NOL carryover to 2014 is the unused part of your 2012 NOL from line 10 of the worksheet. 2005 tax return online Line 2. 2005 tax return online   Treat your NOL deduction for the NOL year entered at the top of the worksheet and later years as a positive amount. 2005 tax return online Add it to your negative taxable income (figured without the NOL deduction). 2005 tax return online Enter the result on line 2. 2005 tax return online Line 6. 2005 tax return online   You must refigure the following income and deductions based on adjusted gross income. 2005 tax return online The special allowance for passive activity losses from rental real estate activities. 2005 tax return online Taxable social security and tier 1 railroad retirement benefits. 2005 tax return online IRA deductions. 2005 tax return online Excludable savings bond interest. 2005 tax return online Excludable employer-provided adoption benefits. 2005 tax return online The student loan interest deduction. 2005 tax return online The tuition and fees deduction. 2005 tax return online   If none of these items apply to you, enter zero on line 6. 2005 tax return online Otherwise, increase your adjusted gross income by the total of lines 3 through 5 and your NOL deduction for the NOL year entered at the top of the worksheet and later years. 2005 tax return online Using this increased adjusted gross income, refigure the items that apply, in the order listed above. 2005 tax return online Your adjustment for each item is the difference between the refigured amount and the amount included on your return. 2005 tax return online Combine the adjustments for previous items with your adjusted gross income before refiguring the next item. 2005 tax return online Keep a record of your computations. 2005 tax return online   Enter your total adjustments for the above items on line 6. 2005 tax return online Line 7. 2005 tax return online   Enter zero if you claimed the standard deduction or the amounts on lines 3 through 5 are zero. 2005 tax return online Otherwise, use lines 11 through 33 of the worksheet to figure the amount to enter on this line. 2005 tax return online Complete only those sections that apply to you. 2005 tax return online Estates and trusts. 2005 tax return online   Enter zero on line 7 if you did not claim any miscellaneous deductions on Form 1041, line 15c, or a casualty or theft loss. 2005 tax return online Otherwise, refigure these deductions by substituting modified adjusted gross income (see below ) for adjusted gross income. 2005 tax return online Subtract the recomputed deductions from those claimed on the return. 2005 tax return online Enter the result on line 7. 2005 tax return online Modified adjusted gross income. 2005 tax return online   To refigure miscellaneous itemized deductions of an estate or trust (Form 1041, line 15c), modified adjusted gross income is the total of the following amounts. 2005 tax return online The adjusted gross income on the return. 2005 tax return online The amounts from lines 3 through 5 of the worksheet. 2005 tax return online The exemption amount from Form 1041, line 20. 2005 tax return online The NOL deduction for the NOL year entered at the top of the worksheet and for later years. 2005 tax return online   To refigure the casualty and theft loss deduction of an estate or trust, modified adjusted gross income is the total of the following amounts. 2005 tax return online The adjusted gross income amount you used to figure the deduction claimed on the return. 2005 tax return online The amounts from lines 3 through 5 of the worksheet. 2005 tax return online The NOL deduction for the NOL year entered at the top of the worksheet and for later years. 2005 tax return online Line 11. 2005 tax return online   Treat your NOL deduction for the NOL year entered at the top of the worksheet and for later years as a positive amount. 2005 tax return online Add it to your adjusted gross income. 2005 tax return online Enter the result on line 11. 2005 tax return online Line 20. 2005 tax return online   Is your modified adjusted gross income from line 13 of this worksheet more than $100,000 ($50,000 if married filing separately)?   □ Yes. 2005 tax return online Your deduction is limited. 2005 tax return online Refigure your deduction using the Mortgage Insurance Premiums Deduction Worksheet in the 2013 Instructions for Form 1045. 2005 tax return online On line 2 of the Mortgage Insurance Premiums Deduction Worksheet, enter the amount from line 13 of this worksheet. 2005 tax return online   □ No. 2005 tax return online Your deduction is not limited. 2005 tax return online Enter the amount from line 19 on line 20 and enter -0- on line 21. 2005 tax return online Line 23. 2005 tax return online   If you had a contributions carryover from 2012 to 2013 and your NOL deduction includes an amount from an NOL year before 2012, you may have to reduce your contributions carryover. 2005 tax return online Reduce the contributions carryover by the amount of any adjustment you made to your 2012 charitable contributions deduction when figuring your NOL carryover to 2013. 2005 tax return online Use the reduced contributions carryover to figure the amount to enter on line 23. 2005 tax return online Please click here for the text description of the image. 2005 tax return online Worksheet for NOL Carryover Worksheet for NOL Carryover (Continued) How To Get Tax Help Whether it's help with a tax issue, preparing your tax return or a need for a free publication or form, get the help you need the way you want it: online, use a smart phone, call or walk in to an IRS office or volunteer site near you. 2005 tax return online Free help with your tax return. 2005 tax return online   You can get free help preparing your return nationwide from IRS-certified volunteers. 2005 tax return online The Volunteer Income Tax Assistance (VITA) program helps low-to-moderate income, elderly, people with disabilities, and limited English proficient taxpayers. 2005 tax return online The Tax Counseling for the Elderly (TCE) program helps taxpayers age 60 and older with their tax returns. 2005 tax return online Most VITA and TCE sites offer free electronic filing and all volunteers will let you know about credits and deductions you may be entitled to claim. 2005 tax return online In addition, some VITA and TCE sites provide taxpayers the opportunity to prepare their own return with help from an IRS-certified volunteer. 2005 tax return online To find the nearest VITA or TCE site, you can use the VITA Locator Tool on IRS. 2005 tax return online gov, download the IRS2Go app, or call 1-800-906-9887. 2005 tax return online   As part of the TCE program, AARP offers the Tax-Aide counseling program. 2005 tax return online To find the nearest AARP Tax-Aide site, visit AARP's website at www. 2005 tax return online aarp. 2005 tax return online org/money/taxaide or call 1-888-227-7669. 2005 tax return online For more 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response for your records. 2005 tax return online New subject areas are added on a regular basis. 2005 tax return online  Answers not provided through ITA may be found in Tax Trails, one of the Tax Topics on IRS. 2005 tax return online gov which contain general individual and business tax information or by searching the IRS Tax Map, which includes an international subject index. 2005 tax return online You can use the IRS Tax Map to search publications and instructions by topic or keyword. 2005 tax return online The IRS Tax Map integrates forms and publications into one research tool and provides single-point access to tax law information by subject. 2005 tax return online When the user searches the IRS Tax Map, they will be provided with links to related content in existing IRS publications, forms and instructions, questions and answers, and Tax Topics. 2005 tax return online Coming this filing season, you can immediately view and print for free all 5 types of individual federal tax transcripts (tax returns, tax account, record of account, wage and income statement, and certification of non-filing) using Get Transcript. 2005 tax return online You can also ask the IRS to mail a return or an account transcript to you. 2005 tax return online Only the mail option is available by choosing the Tax Records option on the IRS2Go app by selecting Mail Transcript on IRS. 2005 tax return online gov or by calling 1-800-908-9946. 2005 tax return online Tax return and tax account transcripts are generally available for the current year and the past three years. 2005 tax return online Determine if you are eligible for the EITC and estimate the amount of the credit with the Earned Income Tax Credit (EITC) Assistant. 2005 tax return online Visit Understanding Your IRS Notice or Letter to get answers to questions about a notice or letter you received from the IRS. 2005 tax return online If you received the First Time Homebuyer Credit, you can use the First Time Homebuyer Credit Account Look-up tool for information on your repayments and account balance. 2005 tax return online Check the status of your amended return using Where's My Amended Return? Go to IRS. 2005 tax return online gov and enter Where's My Amended Return? in the search box. 2005 tax return online You can generally expect your amended return to be processed up to 12 weeks from the date we receive it. 2005 tax return online It can take up to 3 weeks from the date you mailed it to show up in our system. 2005 tax return online Make a payment using one of several safe and convenient electronic payment options available on IRS. 2005 tax return online gov. 2005 tax return online Select the Payment tab on the front page of IRS. 2005 tax return online gov for more information. 2005 tax return online Determine if you are eligible and apply for an online payment agreement, if you owe more tax than you can pay today. 2005 tax return online Figure your income tax withholding with the IRS Withholding Calculator on IRS. 2005 tax return online gov. 2005 tax return online Use it if you've had too much or too little withheld, your personal situation has changed, you're starting a new job or you just want to see if you're having the right amount withheld. 2005 tax return online Determine if you might be subject to the Alternative Minimum Tax by using the Alternative Minimum Tax Assistant on IRS. 2005 tax return online gov. 2005 tax return online Request an Electronic Filing PIN by going to IRS. 2005 tax return online gov and entering Electronic Filing PIN in the search box. 2005 tax return online Download forms, instructions and publications, including accessible versions for people with disabilities. 2005 tax return online Locate the nearest Taxpayer Assistance Center (TAC) using the Office Locator tool on IRS. 2005 tax return online gov, or choose the Contact Us option on the IRS2Go app and search Local Offices. 2005 tax return online An employee can answer questions about your tax account or help you set up a payment plan. 2005 tax return online Before you visit, check the Office Locator on IRS. 2005 tax return online gov, or Local Offices under Contact Us on IRS2Go to confirm the address, phone number, days and hours of operation, and the services provided. 2005 tax return online If you have a special need, such as a disability, you can request an appointment. 2005 tax return online Call the local number listed in the Office Locator, or look in the phone book under United States Government, Internal Revenue Service. 2005 tax return online Apply for an Employer Identification Number (EIN). 2005 tax return online Go to IRS. 2005 tax return online gov and enter Apply for an EIN in the search box. 2005 tax return online Read the Internal Revenue Code, regulations, or other official guidance. 2005 tax return online Read Internal Revenue Bulletins. 2005 tax return online Sign up to receive local and national tax news and more by email. 2005 tax return online Just click on “subscriptions” above the search box on IRS. 2005 tax return online gov and choose from a variety of options. 2005 tax return online Phone. 2005 tax return online    You can call the IRS, or you can carry it in your pocket with the IRS2Go app on your smart phone or tablet. 2005 tax return online Download the free IRS2Go app from the iTunes app store or from Google Play. 2005 tax return online Call to locate the nearest volunteer help site, 1-800-906-9887 or you can use the VITA Locator Tool on IRS. 2005 tax return online gov, or download the IRS2Go app. 2005 tax return online Low-to-moderate income, elderly, people with disabilities, and limited English proficient taxpayers can get free help with their tax return from the nationwide Volunteer Income Tax Assistance (VITA) program. 2005 tax return online The Tax Counseling for the Elderly (TCE) program helps taxpayers age 60 and older with their tax returns. 2005 tax return online Most VITA and TCE sites offer free electronic filing. 2005 tax return online Some VITA and TCE sites provide IRS-certified volunteers who can help prepare your tax return. 2005 tax return online Through the TCE program, AARP offers the Tax-Aide counseling program; call 1-888-227-7669 to find the nearest Tax-Aide location. 2005 tax return online Call the automated Where's My Refund? information hotline to check the status of your 2013 refund 24 hours a day, 7 days a week at 1-800-829-1954. 2005 tax return online If you e-file, you can start checking on the status of your return within 24 hours after the IRS receives your tax return or 4 weeks after you've mailed a paper return. 2005 tax return online The IRS issues more than 9 out of 10 refunds in less than 21 days. 2005 tax return online Where's My Refund? will give you a personalized refund date as soon as the IRS processes your tax return and approves your refund. 2005 tax return online Before you call this automated hotline, have your 2013 tax return handy so you can enter your social security number, your filing status, and the exact whole dollar amount of your refund. 2005 tax return online The IRS updates Where's My Refund? every 24 hours, usually overnight, so you only need to check once a day. 2005 tax return online Note, the above information is for our automated hotline. 2005 tax return online Our live phone and walk-in assistors can research the status of your refund only if it's been 21 days or more since you filed electronically or more than 6 weeks since you mailed your paper return. 2005 tax return online Call the Amended Return Hotline, 1-866-464-2050, to check the status of your amended return. 2005 tax return online You can generally expect your amended return to be processed up to 12 weeks from the date we receive it. 2005 tax return online It can take up to 3 weeks from the date you mailed it to show up in our system. 2005 tax return online Call 1-800-TAX-FORM (1-800-829-3676) to order current-year forms, instructions, publications, and prior-year forms and instructions (limited to 5 years). 2005 tax return online You should receive your order within 10 business days. 2005 tax return online Call TeleTax, 1-800-829-4477, to listen to pre-recorded messages covering general and business tax information. 2005 tax return online If, between January and April 15, you still have questions about the Form 1040, 1040A, or 1040EZ (like filing requirements, dependents, credits, Schedule D, pensions and IRAs or self-employment taxes), call 1-800-829-1040. 2005 tax return online Call using TTY/TDD equipment, 1-800-829-4059 to ask tax questions or order forms and publications. 2005 tax return online The TTY/TDD telephone number is for people who are deaf, hard of hearing, or have a speech disability. 2005 tax return online These individuals can also contact the IRS through relay services such as the Federal Relay Service. 2005 tax return online Walk-in. 2005 tax return online   You can find a selection of forms, publications and services — in person. 2005 tax return online Products. 2005 tax return online You can walk in to some post offices, libraries, and IRS offices to pick up certain forms, instructions, and publications. 2005 tax return online Some IRS offices, libraries, and city and county government offices have a collection of products available to photocopy from reproducible proofs. 2005 tax return online Services. 2005 tax return online You can walk in to your local TAC for face-to-face tax help. 2005 tax return online An employee can answer questions about your tax account or help you set up a payment plan. 2005 tax return online Before visiting, use the Office Locator tool on IRS. 2005 tax return online gov, or choose the Contact Us option on the IRS2Go app and search Local Offices for days and hours of operation, and services provided. 2005 tax return online Mail. 2005 tax return online   You can send your order for forms, instructions, and publications to the address below. 2005 tax return online You should receive a response within 10 business days after your request is received. 2005 tax return online Internal Revenue Service 1201 N. 2005 tax return online Mitsubishi Motorway Bloomington, IL 61705-6613    The Taxpayer Advocate Service Is Here to Help You. 2005 tax return online The Taxpayer Advocate Service (TAS) is your voice at the IRS. 2005 tax return online Our job is to ensure that every taxpayer is treated fairly and that you know and understand your rights. 2005 tax return online   What can TAS do for you? We can offer you free help with IRS problems that you can't resolve on your own. 2005 tax return online We know this process can be confusing, but the worst thing you can do is nothing at all! TAS can help if you can't resolve your tax problem and: Your problem is causing financial difficulties for you, your family, or your business. 2005 tax return online You face (or your business is facing) an immediate threat of adverse action. 2005 tax return online You've tried repeatedly to contact the IRS but no one has responded, or the IRS hasn't responded by the date promised. 2005 tax return online   If you qualify for our help, you'll be assigned to one advocate who'll be with you at every turn and will do everything possible to resolve your problem. 2005 tax return online Here's why we can help: TAS is an independent organization within the IRS. 2005 tax return online Our advocates know how to work with the IRS. 2005 tax return online Our services are free and tailored to meet your needs. 2005 tax return online We have offices in every state, the District of Columbia, and Puerto Rico. 2005 tax return online   How can you reach us? If you think TAS can help you, call your local advocate, whose number is in your local directory and at Taxpayer Advocate, or call us toll-free at 1-877-777-4778. 2005 tax return online   How else does TAS help taxpayers?  TAS also works to resolve large-scale, systemic problems that affect many taxpayers. 2005 tax return online If you know of one of these broad issues, please report it to us through our Systemic Advocacy Management System. 2005 tax return online Low Income Taxpayer Clinics Low Income