File your Taxes for Free!
  • Get your maximum refund*
  • 100% accurate calculations guaranteed*

TurboTax Federal Free Edition - File Taxes Online

Don't let filing your taxes get you down! We'll help make it as easy as possible. With e-file and direct deposit, there's no faster way to get your refund!

Approved TurboTax Affiliate Site. TurboTax and TurboTax Online, among others, are registered trademarks and/or service marks of Intuit Inc. in the United States and other countries. Other parties' trademarks or service marks are the property of the respective owners.


© 2012 - 2018 All rights reserved.

This is an Approved TurboTax Affiliate site. TurboTax and TurboTax Online, among other are registered trademarks and/or service marks of Intuit, Inc. in the United States and other countries. Other parties' trademarks or service marks are the property of the respective owners.
When discussing "Free e-file", note that state e-file is an additional fee. E-file fees do not apply to New York state returns. Prices are subject to change without notice. E-file and get your refund faster
*If you pay an IRS or state penalty or interest because of a TurboTax calculations error, we'll pay you the penalty and interest.
*Maximum Refund Guarantee - or Your Money Back: If you get a larger refund or smaller tax due from another tax preparation method, we'll refund the applicable TurboTax federal and/or state purchase price paid. TurboTax Federal Free Edition customers are entitled to payment of $14.99 and a refund of your state purchase price paid. Claims must be submitted within sixty (60) days of your TurboTax filing date and no later than 6/15/14. E-file, Audit Defense, Professional Review, Refund Transfer and technical support fees are excluded. This guarantee cannot be combined with the TurboTax Satisfaction (Easy) Guarantee. *We're so confident your return will be done right, we guarantee it. Accurate calculations guaranteed. If you pay an IRS or state penalty or interest because of a TurboTax calculations error, we'll pay you the penalty and interest.
https://turbotax.intuit.com/corp/guarantees.jsp

2008 Tax Software

Print Free 1040ez Tax FormFile 2005 TaxesH&r Block Military Key Code1040ez ComIrs Form 1040ez 2013H&r Block 2011 Tax Software Download2010 Form 1040 EzH&r Block Tax FilingFree Turbo Tax 2013 DownloadForm 1040My 1040ezFree Amended Tax ReturnState Tax Forms 2012Is It Too Late To File 2012 Tax ReturnAmended 1040 EzIrs Tax Form 1040How To Fill Out Tax Form 1040xFederal Tax Forms 1040xHow To File 1040nr Ez1040ez Tax Forms To PrintIrs Estimated Tax Form 20122012 Tax Return Turbotax2011 1040ez FormIrs 1040ez 2012Filing 1040x With Form 982Federal And State Tax FormsDefinition Amended Tax ReturnIrs Ez Form Online1040ez Tax TableIrs State Tax Forms 20131040 Easy Form1040ez2012Can I Efile 1040xFile Back Taxes Free OnlineH&r FreeHow Do I Fill Out A 1040x FormForm 1040 Federal Tax FormIrs Tax Form 1040xFree Tax FileTaxact 1040ez

2008 Tax Software

2008 tax software 7. 2008 tax software   How To Get Tax Help Table of Contents 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. 2008 tax software Free help with your tax return. 2008 tax software   You can get free help preparing your return nationwide from IRS-certified volunteers. 2008 tax software The Volunteer Income Tax Assistance (VITA) program helps low-to-moderate income, elderly, people with disabilities, and limited English proficient taxpayers. 2008 tax software The Tax Counseling for the Elderly (TCE) program helps taxpayers age 60 and older with their tax returns. 2008 tax software 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. 2008 tax software In addition, some VITA and TCE sites provide taxpayers the opportunity to prepare their own return with help from an IRS-certified volunteer. 2008 tax software To find the nearest VITA or TCE site, you can use the VITA Locator Tool on IRS. 2008 tax software gov, download the IRS2Go app, or call 1-800-906-9887. 2008 tax software   As part of the TCE program, AARP offers the Tax-Aide counseling program. 2008 tax software To find the nearest AARP Tax-Aide site, visit AARP's website at www. 2008 tax software aarp. 2008 tax software org/money/taxaide or call 1-888-227-7669. 2008 tax software For more information on these programs, go to IRS. 2008 tax software gov and enter “VITA” in the search box. 2008 tax software Internet. 2008 tax software    IRS. 2008 tax software gov and IRS2Go are ready when you are —24 hours a day, 7 days a week. 2008 tax software Download the free IRS2Go app from the iTunes app store or from Google Play. 2008 tax software Use it to check your refund status, order transcripts of your tax returns or tax account, watch the IRS YouTube channel, get IRS news as soon as it's released to the public, subscribe to filing season updates or daily tax tips, and follow the IRS Twitter news feed, @IRSnews, to get the latest federal tax news, including information about tax law changes and important IRS programs. 2008 tax software Check the status of your 2013 refund with the Where's My Refund? application on IRS. 2008 tax software gov or download the IRS2Go app and select the Refund Status option. 2008 tax software The IRS issues more than 9 out of 10 refunds in less than 21 days. 2008 tax software Using these applications, you can start checking on the status of your return within 24 hours after we receive your e-filed return or 4 weeks after you mail a paper return. 2008 tax software You will also be given a personalized refund date as soon as the IRS processes your tax return and approves your refund. 2008 tax software The IRS updates Where's My Refund? every 24 hours, usually overnight, so you only need to check once a day. 2008 tax software Use the Interactive Tax Assistant (ITA) to research your tax questions. 2008 tax software No need to wait on the phone or stand in line. 2008 tax software The ITA is available 24 hours a day, 7 days a week, and provides you with a variety of tax information related to general filing topics, deductions, credits, and income. 2008 tax software When you reach the response screen, you can print the entire interview and the final response for your records. 2008 tax software New subject areas are added on a regular basis. 2008 tax software  Answers not provided through ITA may be found in Tax Trails, one of the Tax Topics on IRS. 2008 tax software gov which contain general individual and business tax information or by searching the IRS Tax Map, which includes an international subject index. 2008 tax software You can use the IRS Tax Map, to search publications and instructions by topic or keyword. 2008 tax software The IRS Tax Map integrates forms and publications into one research tool and provides single-point access to tax law information by subject. 2008 tax software 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. 2008 tax software 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. 2008 tax software You can also ask the IRS to mail a return or an account transcript to you. 2008 tax software Only the mail option is available by choosing the Tax Records option on the IRS2Go app by selecting Mail Transcript on IRS. 2008 tax software gov or by calling 1-800-908-9946. 2008 tax software Tax return and tax account transcripts are generally available for the current year and the past three years. 2008 tax software Determine if you are eligible for the EITC and estimate the amount of the credit with the Earned Income Tax Credit (EITC) Assistant. 2008 tax software Visit Understanding Your IRS Notice or Letter to get answers to questions about a notice or letter you received from the IRS. 2008 tax software 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. 2008 tax software Check the status of your amended return using Where's My Amended Return? Go to IRS. 2008 tax software gov and enter Where's My Amended Return? in the search box. 2008 tax software You can generally expect your amended return to be processed up to 12 weeks from the date we receive it. 2008 tax software It can take up to 3 weeks from the date you mailed it to show up in our system. 2008 tax software Make a payment using one of several safe and convenient electronic payment options available on IRS. 2008 tax software gov. 2008 tax software Select the Payment tab on the front page of IRS. 2008 tax software gov for more information. 2008 tax software Determine if you are eligible and apply for an online payment agreement, if you owe more tax than you can pay today. 2008 tax software Figure your income tax withholding with the IRS Withholding Calculator on IRS. 2008 tax software gov. 2008 tax software 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. 2008 tax software Determine if you might be subject to the Alternative Minimum Tax by using the Alternative Minimum Tax Assistant on IRS. 2008 tax software gov. 2008 tax software Request an Electronic Filing PIN by going to IRS. 2008 tax software gov and entering Electronic Filing PIN in the search box. 2008 tax software Download forms, instructions and publications, including accessible versions for people with disabilities. 2008 tax software Locate the nearest Taxpayer Assistance Center (TAC) using the Office Locator tool on IRS. 2008 tax software gov, or choose the Contact Us option on the IRS2Go app and search Local Offices. 2008 tax software An employee can answer questions about your tax account or help you set up a payment plan. 2008 tax software Before you visit, check the Office Locator on IRS. 2008 tax software gov, or Local Offices under Contact Us on IRS2Go to confirm the address, phone number, days and hours of operation, and the services provided. 2008 tax software If you have a special need, such as a disability, you can request an appointment. 2008 tax software Call the local number listed in the Office Locator, or look in the phone book under United States Government, Internal Revenue Service. 2008 tax software Apply for an Employer Identification Number (EIN). 2008 tax software Go to IRS. 2008 tax software gov and enter Apply for an EIN in the search box. 2008 tax software Read the Internal Revenue Code, regulations, or other official guidance. 2008 tax software Read Internal Revenue Bulletins. 2008 tax software Sign up to receive local and national tax news and more by email. 2008 tax software Just click on “subscriptions” above the search box on IRS. 2008 tax software gov and choose from a variety of options. 2008 tax software Phone. 2008 tax software    You can call the IRS, or you can carry it in your pocket with the IRS2Go app on your smart phone or tablet. 2008 tax software Download the free IRS2Go app from the iTunes app store or from Google Play. 2008 tax software Call to locate the nearest volunteer help site, 1-800-906-9887 or you can use the VITA Locator Tool on IRS. 2008 tax software gov, or download the IRS2Go app. 2008 tax software 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. 2008 tax software The Tax Counseling for the Elderly (TCE) program helps taxpayers age 60 and older with their tax returns. 2008 tax software Most VITA and TCE sites offer free electronic filing. 2008 tax software Some VITA and TCE sites provide IRS-certified volunteers who can help prepare your tax return. 2008 tax software Through the TCE program, AARP offers the Tax-Aide counseling program; call 1-888-227-7669 to find the nearest Tax-Aide location. 2008 tax software 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. 2008 tax software 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. 2008 tax software The IRS issues more than 9 out of 10 refunds in less than 21 days. 2008 tax software Where's My Refund? will give you a personalized refund date as soon as the IRS processes your tax return and approves your refund. 2008 tax software 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. 2008 tax software The IRS updates Where's My Refund? every 24 hours, usually overnight, so you only need to check once a day. 2008 tax software Note, the above information is for our automated hotline. 2008 tax software 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. 2008 tax software Call the Amended Return Hotline, 1-866-464-2050, to check the status of your amended return. 2008 tax software You can generally expect your amended return to be processed up to 12 weeks from the date we receive it. 2008 tax software It can take up to 3 weeks from the date you mailed it to show up in our system. 2008 tax software 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). 2008 tax software You should receive your order within 10 business days. 2008 tax software Call TeleTax, 1-800-829-4477, to listen to pre-recorded messages covering general and business tax information. 2008 tax software 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. 2008 tax software Call using TTY/TDD equipment, 1-800-829-4059 to ask tax questions or order forms and publications. 2008 tax software The TTY/TDD telephone number is for people who are deaf, hard of hearing, or have a speech disability. 2008 tax software These individuals can also contact the IRS through relay services such as the Federal Relay Service. 2008 tax software Walk-in. 2008 tax software   You can find a selection of forms, publications and services — in-person. 2008 tax software Products. 2008 tax software You can walk in to some post offices, libraries, and IRS offices to pick up certain forms, instructions, and publications. 2008 tax software Some IRS offices, libraries, and city and county government offices have a collection of products available to photocopy from reproducible proofs. 2008 tax software Services. 2008 tax software You can walk in to your local TAC for face-to-face tax help. 2008 tax software An employee can answer questions about your tax account or help you set up a payment plan. 2008 tax software Before visiting, use the Office Locator tool on IRS. 2008 tax software gov, or choose the Contact Us option on the IRS2Go app and search Local Offices for days and hours of operation, and services provided. 2008 tax software Mail. 2008 tax software   You can send your order for forms, instructions, and publications to the address below. 2008 tax software You should receive a response within 10 business days after your request is received. 2008 tax software Internal Revenue Service 1201 N. 2008 tax software Mitsubishi Motorway Bloomington, IL 61705-6613    The Taxpayer Advocate Service Is Here to Help You. 2008 tax software The Taxpayer Advocate Service (TAS) is your voice at the IRS. 2008 tax software Our job is to ensure that every taxpayer is treated fairly and that you know and understand your rights. 2008 tax software   What can TAS do for you? We can offer you free help with IRS problems that you can't resolve on your own. 2008 tax software 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. 2008 tax software You face (or your business is facing) an immediate threat of adverse action. 2008 tax software You've tried repeatedly to contact the IRS but no one has responded, or the IRS hasn't responded by the date promised. 2008 tax software   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. 2008 tax software Here's why we can help: TAS is an independent organization within the IRS. 2008 tax software Our advocates know how to work with the IRS. 2008 tax software Our services are free and tailored to meet your needs. 2008 tax software We have offices in every state, the District of Columbia, and Puerto Rico. 2008 tax software   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. 2008 tax software   How else does TAS help taxpayers?  TAS also works to resolve large-scale, systemic problems that affect many taxpayers. 2008 tax software If you know of one of these broad issues, please report it to us through our Systemic Advocacy Management System. 2008 tax software Low Income Taxpayer Clinics. 2008 tax software   Low Income Taxpayer Clinics (LITCs) serve individuals whose income is below a certain level and need to resolve tax problems such as audits, appeals, and tax collection disputes. 2008 tax software Some clinics can provide information about taxpayer rights and responsibilities in different languages for individuals who speak English as a second language. 2008 tax software Visit www. 2008 tax software TaxpayerAdvocate. 2008 tax software irs. 2008 tax software gov or see IRS Publication 4134, Low Income Taxpayer Clinic List. 2008 tax software Prev  Up  Next   Home   More Online Publications
Print - Click this link to Print this page

The Individual Shared Responsibility Provision

Under the Affordable Care Act, the Federal government, State governments, insurers, employers, and individuals share the responsibility for health insurance coverage beginning in 2014. Many people already have qualifying health insurance coverage (called minimum essential coverage) and do not need to do anything more than maintain that coverage.

The individual shared responsibility provision requires you and each member of your family to either:

  • Have minimum essential coverage, or
  • Have an exemption from the responsibility to have minimum essential coverage, or
  • Make a shared responsibility payment when you file your 2014 federal income tax return in 2015.  

You will report minimum essential coverage, report exemptions, or make any individual shared responsibility payment when you file your 2014 federal income tax return in 2015.

Minimum Essential Coverage

 

If you and your family need to acquire minimum essential coverage, you may have several options.  They include:

  • Health insurance coverage provided by your employer,
  • Health insurance purchased through the Health Insurance Marketplace in the area where you live, where you may qualify for financial assistance,
  • Coverage provided under a government-sponsored program for which you are eligible (including Medicare, Medicaid, and health care programs for veterans),
  • Health insurance purchased directly from an insurance company, and
  • Other health insurance coverage that is recognized by the Department of Health & Human Services as minimum essential coverage.

U.S. citizens who are residents of a foreign country for an entire year, and residents of U.S. territories, are deemed to have minimum essential coverage. See questions 11 and 12 of our Questions and Answers for more information.  

For purposes of the individual shared responsibility payment, you are considered to have minimum essential coverage for the entire month as long as you have minimum essential coverage for at least one day during that month. For example, if you start a new job on June 26 and are covered under your employer’s health coverage starting on that day, you’re treated as having coverage for the entire month of June. Similarly, if you’re eligible for an exemption for any one day of a month, you’re treated as exempt for the entire month.

For more information about minimum essential coverage, check this minimum essential coverage chart and see questions 14-20 of our Questions and Answers.  

You can learn more at HealthCare.gov about which health insurance options are available to you, how to purchase health insurance coverage, and how to get financial assistance with the cost of insurance. If you purchase health insurance through the Marketplace and you meet certain requirements, you may be eligible for a premium tax credit to help pay your premiums. Learn more about the premium tax credit. The deadline for the initial open enrollment period is March 31, 2014. You may also qualify for a special enrollment period (e.g., you move to a different state). See HealthCare.gov to learn about special enrollment periods.

Exemptions

 

You may be exempt from the requirement to maintain minimum essential coverage and thus will not have to make a shared responsibility payment when you file your 2014 federal income tax return in 2015, if you meet certain criteria.

You may be exempt if you:

  • Have no affordable coverage options because the minimum amount you must pay for the annual premiums is more than eight percent of your household income,
  • Have a gap in coverage for less than three consecutive months, or
  • Qualify for an exemption for one of several other reasons, including having a hardship that prevents you from obtaining coverage, or belonging to a group explicitly exempt from the requirement.

Because of the Affordable Care Act, more Americans have access to coverage that is affordable. However, if there is no coverage available to you and your family that costs less than eight percent of your household income, you can qualify for an exemption.  

An exemption applies to individuals who purchase their insurance through the Marketplace during the initial enrollment period for 2014, which runs through March 31, 2014. This hardship exemption will apply from January 1, 2014, until the start of your health care coverage, which if you enroll between March 16 and March 31 would generally be May 1. (See this HHS Question and Answer  for more information.) Another hardship exemption may apply if you have been notified that your health insurance policy will not be renewed and you consider the other plans available to you unaffordable. (See this HHS guidance and Questions and Answers  for more information.)

How you get an exemption depends upon the type of exemption for which you are eligible. You can obtain some exemptions only from the Marketplace, others only from the IRS, and yet others from either the Marketplace or the IRS. 

Learn more about exemptions in this chart and in questions 21-24 of our Questions and Answers. Also, see Healthcare.gov for more information on hardship exemptions.

Reporting Coverage or Exemptions

 

The individual shared responsibility provision goes into effect in 2014. You won’t need to report minimum essential coverage or exemptions or make any individual shared responsibility payment until you file your 2014 federal income tax return in 2015. Information will be made available later about how to report your coverage or exemption (or make a payment) on your 2014 income tax return.

Making a Payment

 

If you or any of your dependents don’t have minimum essential coverage and don’t have an exemption, you will need to make an individual shared responsibility payment on your tax return. It is important to remember that choosing to make the individual shared responsibility payment instead of purchasing minimum essential coverage means you will also have to pay the entire cost of all your medical care. You won't be protected from the kind of very high medical bills that can sometimes lead to bankruptcy.

If you must make an individual shared responsibility payment, the annual payment amount is the greater of a percentage of your household income or a flat dollar amount, but is capped at the national average premium for a bronze level health plan available through the Marketplace. You will owe 1/12th of the annual payment for each month you or your dependent(s) don’t have either coverage or an exemption.

For 2014, the annual payment amount is:

  • The greater of:
    • 1 percent of your household income that is above the tax return filing threshold for your filing status, or
    • Your family's flat dollar amount, which is $95 per adult and $47.50 per child, limited to a family maximum of $285,
  • But capped at the cost of the national average premium for a bronze level health plan available through the Marketplace in 2014.

Check out these basic examples of the payment calculation and the federal tax filing requirement thresholds. For more detailed examples, see the individual shared responsibility provision final regulations.

The percentages and flat dollar amounts increase over the first three years. In 2015, the income percentage increases to 2 percent of household income and the flat dollar amount increases to $325 per adult ($162.50 per child under 18). In 2016, these figures increase to 2.5 percent of household income and $695 per adult ($347.50 per child under 18). After 2016, these figures increase with inflation. 

Information will be made available later about how you will account for the payment on your 2014 federal income tax return filed in 2015.

More Information

 

More detailed information about the individual shared responsibility provision is available in our Questions and Answers. The Department of the Treasury and the IRS have issued the following legal guidance related to the individual shared responsibility provision, including detailed examples of the payment calculation:

  • Final regulations on the individual shared responsibility provision.
  • Notice 2013-42, which provides transition relief from the individual shared responsibility provision for employees and their families who are eligible to enroll in employer-sponsored health plans with a plan year other than a calendar year if the plan year begins in 2013 and ends in 2014.
  • Proposed regulations on minimum essential coverage and other rules regarding the shared responsibility provision.
  • Notice 2014-10, which provides transition relief for individuals enrolled in coverage under certain limited-benefit Medicaid and TRICARE programs that are not minimum essential coverage.

Additional information on exemptions and minimum essential coverage is available in final regulations issued by the Department of Health & Human Services.

Page Last Reviewed or Updated: 25-Mar-2014

The 2008 Tax Software

2008 tax software 3. 2008 tax software   Abandonments Table of Contents You abandon property when you voluntarily and permanently give up possession and use of the property with the intention of ending your ownership but without passing it on to anyone else. 2008 tax software Whether an abandonment has occurred is determined in light of all the facts and circumstances. 2008 tax software You must both show an intention to abandon the property and affirmatively act to abandon the property. 2008 tax software A voluntary conveyance of the property in lieu of foreclosure is not an abandonment and is treated as the exchange of property to satisfy a debt. 2008 tax software For more information, see Sales and Exchanges in Publication 544. 2008 tax software The tax consequences of abandonment of property that secures a debt depend on whether you were personally liable for the debt (recourse debt) or were not personally liable for the debt (nonrecourse debt). 2008 tax software See Publication 544 if you abandoned property that did not secure debt. 2008 tax software This publication only discusses the tax consequences of abandoning property that secured a debt. 2008 tax software Abandonment of property securing recourse debt. 2008 tax software    In most cases, if you abandon property that secures debt for which you are personally liable (recourse debt), you do not have gain or loss until the later foreclosure is completed. 2008 tax software For details on figuring gain or loss on the foreclosure, see chapter 2. 2008 tax software Example 1—abandonment of personal-use property securing recourse debt. 2008 tax software In 2009, Anne purchased a home for $200,000. 2008 tax software She borrowed the entire purchase price, for which she was personally liable, and gave the bank a mortgage on the home. 2008 tax software In 2013, Anne lost her job and was unable to continue making her mortgage loan payments. 2008 tax software Because her mortgage loan balance was $185,000 and the FMV of her home was only $150,000, Anne decided to abandon her home by permanently moving out on August 1, 2013. 2008 tax software Because Anne was personally liable for the debt and the bank did not complete a foreclosure of the property in 2013, Anne has neither gain nor loss in tax year 2013 from abandoning the home. 2008 tax software If the bank sells the house at a foreclosure sale in 2014, Anne will have to figure her gain or nondeductible loss for tax year 2014 as discussed earlier in chapter 2. 2008 tax software Example 2—abandonment of business or investment property securing recourse debt. 2008 tax software In 2009, Sue purchased business property for $200,000. 2008 tax software She borrowed the entire purchase price, for which she was personally liable, and gave the lender a security interest in the property. 2008 tax software In 2013, Sue was unable to continue making her loan payments. 2008 tax software Because her loan balance was $185,000 and the FMV of the property was only $150,000, Sue abandoned the property on August 1, 2013. 2008 tax software Because Sue was personally liable for the debt and the lender did not complete a foreclosure of the property in 2013, Sue has neither gain nor loss in tax year 2013 from abandoning the property. 2008 tax software If the lender sells the property at a foreclosure sale in 2014, Sue will have to figure her gain or deductible loss for tax year 2014 as discussed earlier in chapter 2. 2008 tax software Abandonment of property securing nonrecourse debt. 2008 tax software    If you abandon property that secures debt for which you are not personally liable (nonrecourse debt), the abandonment is treated as a sale or exchange. 2008 tax software   The amount you realize on the abandonment of property that secured nonrecourse debt is the amount of the nonrecourse debt. 2008 tax software If the amount you realize is more than your adjusted basis, then you have a gain. 2008 tax software If your adjusted basis is more than the amount you realize, then you have a loss. 2008 tax software For more information on how to figure gain and loss, see Gain or Loss from Sales or Exchanges in Publication 544. 2008 tax software   Loss from abandonment of business or investment property is deductible as a loss. 2008 tax software The character of the loss depends on the character of the property. 2008 tax software The amount of deductible capital loss may be limited. 2008 tax software For more information, see Treatment of Capital Losses in Publication 544. 2008 tax software You cannot deduct any loss from abandonment of your home or other property held for personal use. 2008 tax software Example 1—abandonment of personal-use property securing nonrecourse debt. 2008 tax software In 2009, Timothy purchased a home for $200,000. 2008 tax software He borrowed the entire purchase price, for which he was not personally liable, and gave the bank a mortgage on the home. 2008 tax software In 2013, Timothy lost his job and was unable to continue making his mortgage loan payments. 2008 tax software Because his mortgage loan balance was $185,000 and the FMV of his home was only $150,000, Timothy decided to abandon his home by permanently moving out on August 1, 2013. 2008 tax software Because Timothy was not personally liable for the debt, the abandonment is treated as a sale or exchange of the home in tax year 2013. 2008 tax software Timothy's amount realized is $185,000 and his adjusted basis in the home is $200,000. 2008 tax software Timothy has a $15,000 nondeductible loss in tax year 2013. 2008 tax software (Had Timothy’s adjusted basis been less than the amount realized, Timothy would have had a gain that he would have to include in gross income. 2008 tax software ) The bank sells the house at a foreclosure sale in 2014. 2008 tax software Timothy has neither gain nor loss from the foreclosure sale. 2008 tax software Because he was not personally liable for the debt, he also has no cancellation of debt income. 2008 tax software Example 2—abandonment of business or investment property securing nonrecourse debt. 2008 tax software In 2009, Robert purchased business property for $200,000. 2008 tax software He borrowed the entire purchase price, for which he was not personally liable, and gave the lender a security interest in the property. 2008 tax software In 2013, Robert was unable to continue making his loan payments. 2008 tax software Because his loan balance was $185,000 and the FMV of the property was only $150,000, Robert decided to abandon the property on August 1, 2013. 2008 tax software Because Robert was not personally liable for the debt, the abandonment is treated as a sale or exchange of the property in tax year 2013. 2008 tax software Robert's amount realized is $185,000 and his adjusted basis in the property is $180,000 (as a result of $20,000 of depreciation deductions on the property). 2008 tax software Robert has a $5,000 gain in tax year 2013. 2008 tax software (Had Robert’s adjusted basis been greater than the amount realized, he would have had a deductible loss. 2008 tax software ) The lender sells the property at a foreclosure sale in 2014. 2008 tax software Robert has neither gain nor loss from the foreclosure sale. 2008 tax software Because he was not personally liable for the debt, he also has no cancellation of debt income. 2008 tax software Canceled debt. 2008 tax software    If the abandoned property secures a debt for which you are personally liable and the debt is canceled, you will realize ordinary income equal to the canceled debt. 2008 tax software This income is separate from any amount realized from abandonment of the property. 2008 tax software You must report this income on your return unless one of the exceptions or exclusions described in chapter 1 applies. 2008 tax software See chapter 1 for more details. 2008 tax software Forms 1099-A and 1099-C. 2008 tax software    In most cases, if you abandon real property (such as a home), intangible property, or tangible personal property held (wholly or partly) for use in a trade or business or for investment, that secures a loan and the lender knows the property has been abandoned, the lender should send you Form 1099-A showing information you need to figure your gain or loss from the abandonment. 2008 tax software Also, if your debt is canceled and the lender must file Form 1099-C, the lender can include the information about the abandonment on that form instead of on Form 1099-A. 2008 tax software The lender must file Form 1099-C and send you a copy if the amount of debt canceled is $600 or more and the lender is a financial institution, credit union, federal government agency, or any organization that has a significant trade or business of lending money. 2008 tax software For abandonments of property and debt cancellations occurring in 2013, these forms should be sent to you by January 31, 2014. 2008 tax software Prev  Up  Next   Home   More Online Publications