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2011 tax software download Publication 3920 - Main Contents Table of Contents Tax ForgivenessYears Eligible for Tax Forgiveness Amount of Tax Forgiven Refund of Taxes Paid How To Claim Tax Forgiveness Payments to SurvivorsSeptember 11th Victim Compensation Fund of 2001 Qualified Disaster Relief Payments Disability Payments Death Benefits Canceled Debt Payments to Survivors of Public Safety Officers Postponed Tax DeadlinesCovered area. 2011 tax software download Disaster Area Losses Estate Tax Reduction Structured Settlement Factoring Transactions Illustrated Worksheets B and C Additional Worksheets How To Get Tax Help Tax Forgiveness The IRS will forgive the federal income tax liabilities of decedents who died as a result of the Oklahoma City attack, September 11 attacks, and anthrax attacks. 2011 tax software download Income tax is forgiven for these decedents whether they were killed in an attack or in rescue or recovery operations. 2011 tax software download Any forgiven tax liability owed to the IRS will not have to be paid. 2011 tax software download Any forgiven tax liability that has already been paid will be refunded. 2011 tax software download (See Refund of Taxes Paid, later. 2011 tax software download ) To determine the amount of tax to be forgiven, read Years Eligible for Tax Forgiveness first. 2011 tax software download Then read Amount of Tax Forgiven. 2011 tax software download Decedents whose total forgiven tax liability for all eligible years is less than $10,000 are entitled to $10,000 minimum relief. 2011 tax software download Even decedents who were not required to file tax returns for the eligible tax years are entitled to $10,000 minimum relief. 2011 tax software download See Minimum Amount of Relief later under Amount of Tax Forgiven. 2011 tax software download Years Eligible for Tax Forgiveness The following paragraphs explain which years are eligible for tax forgiveness. 2011 tax software download Oklahoma City attack. 2011 tax software download   For those who died from this attack, income tax is forgiven for 1994 and all later years up to and including the year of death. 2011 tax software download Example 1. 2011 tax software download A man was killed in the bombing of the federal building in Oklahoma City on April 19, 1995. 2011 tax software download His income tax is forgiven for 1994 and 1995. 2011 tax software download Example 2. 2011 tax software download A woman was wounded while walking outside the federal building in Oklahoma City on April 19, 1995. 2011 tax software download She subsequently died of her wounds in 1996. 2011 tax software download Her income tax is forgiven for 1994, 1995, and 1996. 2011 tax software download September 11 attacks and anthrax attacks. 2011 tax software download   For those who die from these attacks, income tax is forgiven for 2000 and all later years up to and including the year of death. 2011 tax software download Example 1. 2011 tax software download A Pentagon employee died in the September 11 attack. 2011 tax software download Her income tax is forgiven for 2000 and 2001. 2011 tax software download Example 2. 2011 tax software download A visitor to the World Trade Center died in 2002 of wounds he sustained in the September 11 attack. 2011 tax software download His income tax liability is forgiven for 2000, 2001, and 2002. 2011 tax software download Amount of Tax Forgiven The IRS will forgive the decedent's income tax liability for all years eligible for tax forgiveness. 2011 tax software download On a joint return, only the decedent's part of the joint income tax liability is eligible for forgiveness. 2011 tax software download To figure the tax to be forgiven, use the following worksheets. 2011 tax software download Use Worksheet A for any eligible year the decedent filed a return as single, married filing separately, head of household, or qualifying widow(er). 2011 tax software download Use Worksheet B for any eligible year the decedent filed a joint return. 2011 tax software download See the illustrated Worksheet B near the end of this publication. 2011 tax software download Do not complete Worksheet A or B if the decedent was not required to file tax returns for the eligible tax years. 2011 tax software download Instead, complete Worksheet C and file a return for the decedent's last tax year. 2011 tax software download See Minimum Amount of Relief, later. 2011 tax software download If you need assistance, call the IRS at 1–866–562–5227 Monday through Friday during the following times. 2011 tax software download In English–7 a. 2011 tax software download m. 2011 tax software download to 10 p. 2011 tax software download m. 2011 tax software download local time. 2011 tax software download In Spanish–8 a. 2011 tax software download m. 2011 tax software download to 9:30 p. 2011 tax software download m. 2011 tax software download local time. 2011 tax software download Both spouses died. 2011 tax software download   If both spouses died as a result of a terrorist attack and they filed a joint return for an eligible tax year, fill out Worksheet B for each spouse for that year. 2011 tax software download Do this to determine if each spouse qualifies for the minimum relief of $10,000 (discussed later under Minimum Amount of Relief). 2011 tax software download If you are certain that neither spouse's total forgiven tax liability for all eligible years is less than $10,000, skip Worksheet B. 2011 tax software download However, attach a computation of the forgiven tax liability to the final income tax return or amended tax return for each eligible year. 2011 tax software download The forgiven tax liability is the total tax shown on the joint return minus the taxes listed in the instructions for line 4 of Worksheet B. 2011 tax software download Residents of community property states. 2011 tax software download   If the decedent was domiciled in a community property state and the spouse reported half the community income on a separate return, the surviving spouse can get a refund of taxes paid on his or her share of the decedent's income for the eligible years. 2011 tax software download Also, all of the decedent's income taxes paid for the eligible years will be refunded to either the executor or administrator of the estate, or to the surviving spouse if there is no legal representative. 2011 tax software download Worksheet B. 2011 tax software download Figuring the Tax To Be Forgiven (For Decedents Who Filed a Joint Return)       (A) First Eligible Year (1994 or 2000) (B) Second Eligible Year (1995 or 2001) (C) Third Eligible Year (1996 or 2002) 1 Enter the years eligible for forgiveness. 2011 tax software download 1       2 Enter the decedent's taxable income. 2011 tax software download Figure taxable income as if a separate return had been filed. 2011 tax software download See the instructions. 2011 tax software download 2       3 Enter the decedent's total tax. 2011 tax software download See the instructions. 2011 tax software download 3       4 Enter the total, if any, of the decedent's taxes not eligible for forgiveness. 2011 tax software download See the instructions. 2011 tax software download 4       5 Subtract line 4 from line 3. 2011 tax software download 5       6 Enter the surviving spouse's taxable income. 2011 tax software download Figure taxable income as if a separate return had been filed. 2011 tax software download See the instructions. 2011 tax software download 6       7 Enter the surviving spouse's total tax. 2011 tax software download See the instructions. 2011 tax software download 7       8 Enter the total, if any, of the surviving spouse's taxes listed in the instructions for line 4. 2011 tax software download 8       9 Subtract line 8 from line 7. 2011 tax software download 9       10 Add lines 5 and 9. 2011 tax software download 10       11 Enter the total tax from the joint return. 2011 tax software download See Table 1 on page 5 for the line number for years before 2002. 2011 tax software download 11       12 Add lines 4 and 8. 2011 tax software download 12       13 Subtract line 12 from line 11. 2011 tax software download 13       14 Divide line 5 by line 10. 2011 tax software download Enter the result as a decimal. 2011 tax software download 14       15 Tax to be forgiven. 2011 tax software download Multiply line 13 by line 14 and enter the result. 2011 tax software download 15       Note. 2011 tax software download If the total of columns (A), (B), and (C) of line 15 (including any amounts shown on line 5 of Worksheet A) is less than $10,000, also complete Worksheet C. 2011 tax software download Attach the computation of the tax to be forgiven or a copy of this worksheet to the decedent's final income tax return or amended tax return (Form 1040X) for each year listed on line 1. 2011 tax software download If filing Form 1040X for an eligible year, enter the amount from line 15 above on Form 1040X in column B of line 10 as a decrease in tax. 2011 tax software download The IRS will determine the amount to be refunded. 2011 tax software download Worksheet B. 2011 tax software download Figuring the Tax To Be Forgiven (For Decedents Who Filed a Joint Return)       (A) First Eligible Year (1994 or 2000) (B) Second Eligible Year (1995 or 2001) (C) Third Eligible Year (1996 or 2002) 1 Enter the years eligible for forgiveness. 2011 tax software download 1       2 Enter the decedent's taxable income. 2011 tax software download Figure taxable income as if a separate return had been filed. 2011 tax software download See the instructions. 2011 tax software download 2       3 Enter the decedent's total tax. 2011 tax software download See the instructions. 2011 tax software download 3       4 Enter the total, if any, of the decedent's taxes not eligible for forgiveness. 2011 tax software download See the instructions. 2011 tax software download 4       5 Subtract line 4 from line 3. 2011 tax software download 5       6 Enter the surviving spouse's taxable income. 2011 tax software download Figure taxable income as if a separate return had been filed. 2011 tax software download See the instructions. 2011 tax software download 6       7 Enter the surviving spouse's total tax. 2011 tax software download See the instructions. 2011 tax software download 7       8 Enter the total, if any, of the surviving spouse's taxes listed in the instructions for line 4. 2011 tax software download 8       9 Subtract line 8 from line 7. 2011 tax software download 9       10 Add lines 5 and 9. 2011 tax software download 10       11 Enter the total tax from the joint return. 2011 tax software download See Table 1 on page 5 for the line number for years before 2002. 2011 tax software download 11       12 Add lines 4 and 8. 2011 tax software download 12       13 Subtract line 12 from line 11. 2011 tax software download 13       14 Divide line 5 by line 10. 2011 tax software download Enter the result as a decimal. 2011 tax software download 14       15 Tax to be forgiven. 2011 tax software download Multiply line 13 by line 14 and enter the result. 2011 tax software download 15       Note. 2011 tax software download If the total of columns (A), (B), and (C) of line 15 (including any amounts shown on line 5 of Worksheet A) is less than $10,000, also complete Worksheet C. 2011 tax software download Attach the computation of the tax to be forgiven or a copy of this worksheet to the decedent's final income tax return or amended tax return (Form 1040X) for each year listed on line 1. 2011 tax software download If filing Form 1040X for an eligible year, enter the amount from line 15 above on Form 1040X in column B of line 10 as a decrease in tax. 2011 tax software download The IRS will determine the amount to be refunded. 2011 tax software download Instructions for Worksheet B Table 1. 2011 tax software download Total Tax Line on Decedent's Return Note: Use this table to find the total tax line on the decedent's income tax return. 2011 tax software download * Form 1994 1995 1996 2000 2001 1040 Line 53 Line 54 Line 51 Line 57 Line 58 1040A Line 27 Line 28 Line 28 Line 35 File Form 1040 1040EZ Line 9 Line 10 Line 10 Line 10 TeleFile Tax Record ** Line E Line J Line K 1040NR Line 51 Line 52 Line 49 Line 54 Line 54 1040NR–EZ N/A Line 17 Line 17 Line 18 File Form 1040NR * Line numbers for the 2002 forms were not available when this publication went to print. 2011 tax software download ** File Form 4506 to get a transcript of the decedent's account. 2011 tax software download Table 1. 2011 tax software download Total Tax Line on Decedent's Return Note: Use this table to find the total tax line on the decedent's income tax return. 2011 tax software download * Form 1994 1995 1996 2000 2001 1040 Line 53 Line 54 Line 51 Line 57 Line 58 1040A Line 27 Line 28 Line 28 Line 35 File Form 1040 1040EZ Line 9 Line 10 Line 10 Line 10 TeleFile Tax Record ** Line E Line J Line K 1040NR Line 51 Line 52 Line 49 Line 54 Line 54 1040NR–EZ N/A Line 17 Line 17 Line 18 File Form 1040NR * Line numbers for the 2002 forms were not available when this publication went to print. 2011 tax software download ** File Form 4506 to get a transcript of the decedent's account. 2011 tax software download Lines 2 and 6. 2011 tax software download   Allocate income and deductions in the same manner they would have been allocated if the spouses had filed separate returns. 2011 tax software download   Allocate wages and salaries to the spouse who performed the services and received the Form W-2. 2011 tax software download Business and investment income (including capital gains) are generally allocated to the spouse who owned the business or investment that produced the income. 2011 tax software download Income from a jointly owned business or investment should be allocated equally between the spouses unless there is evidence that shows a different allocation is appropriate. 2011 tax software download   Allocate business deductions to the owner of the business. 2011 tax software download Allocate personal deductions (such as itemized deductions for mortgage interest and taxes) equally between the spouses unless there is evidence that shows a different allocation is appropriate. 2011 tax software download Lines 3 and 7. 2011 tax software download   Figure the total tax as if a separate return had been filed. 2011 tax software download The total tax is the tax that would have been entered on the tax return line shown in Table 1 if a separate return had been filed. 2011 tax software download When figuring the tax using the Tax Table or Tax Rate Schedule, use the “Married filing separately” column in the Tax Table or Tax Rate Schedule Y-2. 2011 tax software download   When figuring the total tax, allocate credits and other taxes, if any, in the same manner as they would have been allocated if the spouses had filed separate returns. 2011 tax software download If a credit would not have been allowed on a separate return, allocate the credit shown on the joint return between the spouses. 2011 tax software download Examples of credits generally not allowed on a separate return are the child and dependent care credit, credit for the elderly, adoption credit, education credits, and earned income credit. 2011 tax software download Line 4. 2011 tax software download   Enter the total, if any, of the following taxes. 2011 tax software download Self-employment tax. 2011 tax software download Social security and Medicare tax on tip income not reported to employer. 2011 tax software download Tax on excess contributions to IRAs, Coverdell education savings accounts (formerly Ed IRAs), or Archer MSAs (formerly medical savings accounts). 2011 tax software download Tax on excess accumulation in qualified retirement plans. 2011 tax software download Household employment taxes. 2011 tax software download Uncollected social security and Medicare or RRTA tax on tips or group-term life insurance. 2011 tax software download Tax on golden parachute payments. 2011 tax software download Minimum Amount of Relief The minimum amount of relief is $10,000. 2011 tax software download If the decedent's total forgiven tax liability for all eligible years is less than $10,000, the difference between $10,000 and the total forgiven tax liability for those years will be treated as a tax payment for the decedent's last tax year. 2011 tax software download The IRS will refund the difference as explained under Refund of Taxes Paid. 2011 tax software download Use Worksheet C to figure the additional tax payment. 2011 tax software download But first complete Worksheet A or B, unless the decedent was not required to file tax returns for the eligible tax years. 2011 tax software download Example 1. 2011 tax software download An individual who died in the September 11 attacks had an income tax liability of $-0- for 2000 and $6,400 for 2001. 2011 tax software download The $6,400 is eligible for forgiveness. 2011 tax software download The IRS will forgive $6,400 and treat the difference between $10,000 and $6,400 ($3,600) as a tax payment for 2001. 2011 tax software download Example 2. 2011 tax software download A child who died in the September 11 attacks had no (-0-) income tax liability for 2000 or 2001. 2011 tax software download The IRS will treat $10,000 as a tax payment for 2001. 2011 tax software download Income received after date of death. 2011 tax software download   Generally, income of the decedent received after the date of death must be reported on Form 1041 if the estate has gross income for the tax year of $600 or more. 2011 tax software download Examples are the final paycheck or dividends on stock owned by the decedent. 2011 tax software download However, this income is exempt from income tax and is not included on Form 1041 if it is received: After the date of the decedent's death, and Before the end of the decedent's tax year (determined without regard to death). 2011 tax software download Nonqualifying income. 2011 tax software download   The following income is not exempt from tax. 2011 tax software download The tax on it is not eligible for forgiveness. 2011 tax software download Deferred compensation that would have been payable if the death had occurred because of an event other than these attacks. 2011 tax software download Amounts that would not have been payable but for an action taken after September 11, 2001. 2011 tax software download The following are examples of nonqualifying income. 2011 tax software download Amounts payable from a qualified retirement plan or IRA to the beneficiary or estate of the decedent. 2011 tax software download Amounts payable only as death or survivor's benefits from pre-existing arrangements that would have been paid if the death had occurred for another reason. 2011 tax software download Income received as a result of adjustments made by the decedent's employer to a plan or arrangement to accelerate the vesting of restricted property or the payment of nonqualified deferred compensation after the date of the attack. 2011 tax software download Interest on savings bonds cashed by the beneficiary of the decedent. 2011 tax software download If you are responsible for the estate of a decedent, see Publication 559. 2011 tax software download Publication 559 discusses how to complete and file federal income tax returns and explains your responsibility to pay any taxes due. 2011 tax software download Instructions for lines 2–9 of Worksheet C. 2011 tax software download   The tax that would have been payable on the exempt income (discussed earlier) must be considered when determining whether a decedent is entitled to the $10,000 minimum relief. 2011 tax software download To figure the tax that would have been payable, you can use lines 2 through 9 of Worksheet C. 2011 tax software download Or, if special requirements are met, you can use the alternative computation instead. 2011 tax software download See Alternative computation, later. 2011 tax software download   You have to use lines 2–9 (or the alternative computation) to figure the tax that would have been payable even if Form 1041 was not required to be filed. 2011 tax software download Use Form 1041 to figure what the taxable income would be without including the exempt income. 2011 tax software download Then enter that taxable income (even if a negative number) on line 2 of Worksheet C (or line 1 of Worksheet D, Alternative Computation of Tax on Exempt Income (Line 9 of Worksheet C)). 2011 tax software download Alternative computation. 2011 tax software download   Instead of using lines 2–8 of Worksheet C to figure the tax on exempt income (line 9 of Worksheet C), you may be able to use Worksheet D. 2011 tax software download You can use Worksheet D to figure the tax on the exempt income payable by the estate and its beneficiaries only if both of the following requirements are met. 2011 tax software download The estate claimed an income distribution deduction on line 18 (Form 1041). 2011 tax software download Each beneficiary submits the information necessary to refigure the income tax payable on the exempt income received from the decedent's estate. 2011 tax software download If requirement (2) is met but requirement (1) is not, you can still use Worksheet D if: Form 1041 was not required because exempt income was received, and The estate would have claimed an income distribution deduction if the exempt income were taxable. 2011 tax software download If you use this alternative computation, skip lines 2–8 of Worksheet C and enter the amount from line 8 of Worksheet D on line 9 of Worksheet C. 2011 tax software download Complete the rest of Worksheet C to determine the additional payment allowed. 2011 tax software download Worksheet C. 2011 tax software download Amount Treated as Tax Payment for Decedent's Last Tax Year Caution: The decedent is entitled to minimum relief of $10,000. 2011 tax software download Complete this worksheet only if the total tax forgiven for all eligible years is less than $10,000. 2011 tax software download 1 Minimum relief amount. 2011 tax software download Note: Before completing lines 2–9, see Instructions for lines 2–9 of Worksheet C. 2011 tax software download 1 $10,000 2 Enter the taxable income from line 22 (Form 1041) 2       3 Enter the distribution deduction from line 18 (Form 1041) . 2011 tax software download 3       4 Add lines 2 and 3. 2011 tax software download 4       5 Enter exempt income received after death minus expenses allocable to exempt income. 2011 tax software download (See Income received after date of death on page 5. 2011 tax software download ) 5       6 Add lines 4 and 5. 2011 tax software download 6       7 Figure the tax on line 6 using Schedule G (Form 1041). 2011 tax software download 7       8 Figure the tax on line 4 using Schedule G (Form 1041). 2011 tax software download 8       9 Tax on exempt income. 2011 tax software download Subtract line 8 from line 7. 2011 tax software download 9       10 Enter the total of columns (A)–(C) from line 5 of Worksheet A or line 15 of Worksheet B. 2011 tax software download If the decedent was not required to file tax returns for the eligible tax years, enter -0-. 2011 tax software download 10       11 Add lines 9 and 10. 2011 tax software download 11   12 Additional payment allowed. 2011 tax software download If line 11 is $10,000 or more, enter -0- and stop here. 2011 tax software download No additional amount is allowed as a tax payment. 2011 tax software download Otherwise, subtract line 11 from line 1 and enter the result. 2011 tax software download 12   Note. 2011 tax software download The amount on line 12 is allowed as a tax payment for the decedent's last tax year (usually 1995 or 2001). 2011 tax software download Attach the computation of the additional payment allowed or a copy of this worksheet to the original or amended income tax return for the decedent's last tax year. 2011 tax software download If filing Form 1040, include the amount from line 12 above on the “Other payments” line of the form. 2011 tax software download Write "Sec. 2011 tax software download 692(d)(2) Payment" and the amount to the right of the entry space. 2011 tax software download Also indicate whether a Form 1041 is being filed for the decedent's estate. 2011 tax software download If filing Form 1040X, include the amount from line 12 above on Form 1040X on line 15, columns (B) and (C). 2011 tax software download Write “Sec. 2011 tax software download 692(d)(2) Payment” on the dotted line to the left of the entry space. 2011 tax software download Worksheet C. 2011 tax software download Amount Treated as Tax Payment for Decedent's Last Tax Year Caution: The decedent is entitled to minimum relief of $10,000. 2011 tax software download Complete this worksheet only if the total tax forgiven for all eligible years is less than $10,000. 2011 tax software download 1 Minimum relief amount. 2011 tax software download Note: Before completing lines 2–9, see Instructions for lines 2–9 of Worksheet C. 2011 tax software download 1 $10,000 2 Enter the taxable income from line 22 (Form 1041) 2       3 Enter the distribution deduction from line 18 (Form 1041) . 2011 tax software download 3       4 Add lines 2 and 3. 2011 tax software download 4       5 Enter exempt income received after death minus expenses allocable to exempt income. 2011 tax software download (See Income received after date of death on page 5. 2011 tax software download ) 5       6 Add lines 4 and 5. 2011 tax software download 6       7 Figure the tax on line 6 using Schedule G (Form 1041). 2011 tax software download 7       8 Figure the tax on line 4 using Schedule G (Form 1041). 2011 tax software download 8       9 Tax on exempt income. 2011 tax software download Subtract line 8 from line 7. 2011 tax software download 9       10 Enter the total of columns (A)–(C) from line 5 of Worksheet A or line 15 of Worksheet B. 2011 tax software download If the decedent was not required to file tax returns for the eligible tax years, enter -0-. 2011 tax software download 10       11 Add lines 9 and 10. 2011 tax software download 11   12 Additional payment allowed. 2011 tax software download If line 11 is $10,000 or more, enter -0- and stop here. 2011 tax software download No additional amount is allowed as a tax payment. 2011 tax software download Otherwise, subtract line 11 from line 1 and enter the result. 2011 tax software download 12   Note. 2011 tax software download The amount on line 12 is allowed as a tax payment for the decedent's last tax year (usually 1995 or 2001). 2011 tax software download Attach the computation of the additional payment allowed or a copy of this worksheet to the original or amended income tax return for the decedent's last tax year. 2011 tax software download If filing Form 1040, include the amount from line 12 above on the “Other payments” line of the form. 2011 tax software download Write "Sec. 2011 tax software download 692(d)(2) Payment" and the amount to the right of the entry space. 2011 tax software download Also indicate whether a Form 1041 is being filed for the decedent's estate. 2011 tax software download If filing Form 1040X, include the amount from line 12 above on Form 1040X on line 15, columns (B) and (C). 2011 tax software download Write “Sec. 2011 tax software download 692(d)(2) Payment” on the dotted line to the left of the entry space. 2011 tax software download Worksheet D. 2011 tax software download Alternative Computation of Tax on Exempt Income (Line 9 of Worksheet C) 1 Enter the taxable income from line 22 (Form 1041) 1   2 Enter exempt income received after death minus expenses allocable to exempt income. 2011 tax software download (See Income received after date of death on page 5. 2011 tax software download ) 2   3 Add lines 1 and 2 3   4 Figure the tax on line 3 using Schedule G (Form 1041). 2011 tax software download 4   5 Figure the tax on line 1 using Schedule G (Form 1041). 2011 tax software download 5   6 Estate's tax on exempt income. 2011 tax software download Subtract line 5 from line 4 6   7 Beneficiaries' tax on exempt income. 2011 tax software download Figure the total tax that would have been payable by all beneficiaries. 2011 tax software download Do this by including in each beneficiary's gross income the exempt income received from the decedent's estate and refiguring the income tax. 2011 tax software download Add the amounts by which each beneficiary's income tax is increased. 2011 tax software download 7   8 Add lines 6 and 7. 2011 tax software download Enter this amount on line 9 of Worksheet C. 2011 tax software download 8   Worksheet D. 2011 tax software download Alternative Computation of Tax on Exempt Income (Line 9 of Worksheet C) 1 Enter the taxable income from line 22 (Form 1041) 1   2 Enter exempt income received after death minus expenses allocable to exempt income. 2011 tax software download (See Income received after date of death on page 5. 2011 tax software download ) 2   3 Add lines 1 and 2 3   4 Figure the tax on line 3 using Schedule G (Form 1041). 2011 tax software download 4   5 Figure the tax on line 1 using Schedule G (Form 1041). 2011 tax software download 5   6 Estate's tax on exempt income. 2011 tax software download Subtract line 5 from line 4 6   7 Beneficiaries' tax on exempt income. 2011 tax software download Figure the total tax that would have been payable by all beneficiaries. 2011 tax software download Do this by including in each beneficiary's gross income the exempt income received from the decedent's estate and refiguring the income tax. 2011 tax software download Add the amounts by which each beneficiary's income tax is increased. 2011 tax software download 7   8 Add lines 6 and 7. 2011 tax software download Enter this amount on line 9 of Worksheet C. 2011 tax software download 8   Refund of Taxes Paid The IRS will refund the following forgiven income tax liabilities. 2011 tax software download Income tax liabilities that have been paid. 2011 tax software download Income tax liabilities treated as paid because the total tax liability for all years eligible for tax forgiveness is less than $10,000. 2011 tax software download See Minimum Amount of Relief, earlier. 2011 tax software download Example 1. 2011 tax software download A man who died in the September 11 attacks had an income tax liability of $7,500 for 2000 and $6,500 for 2001. 2011 tax software download The total, $14,000, is eligible for tax forgiveness. 2011 tax software download However, he paid only $13,000 of that amount. 2011 tax software download The IRS will refund the $13,000 paid. 2011 tax software download Example 2. 2011 tax software download A child who died in the September 11 attacks had no income tax liability for 2000 or 2001. 2011 tax software download The child qualifies for the minimum relief of $10,000. 2011 tax software download The $10,000 is treated as a tax payment for 2001 and will be refunded. 2011 tax software download Period for filing a claim for credit or refund. 2011 tax software download   To obtain a tax refund on a previously filed income tax return, file an amended return (Form 1040X or an amended Form 1041) within 3 years from the time the return was filed or 2 years from the time the tax was paid, whichever is later. 2011 tax software download For example, you have until April 15, 2004, to file an amended return on a 2000 Form 1040, 1040A, or 1040EZ that was filed by April 16, 2001, and for which the tax was paid when due. 2011 tax software download To obtain a refund on a return that has not been filed, file the return within 3 years of the original due date of the return. 2011 tax software download Extension of time for victims of Oklahoma City attack. 2011 tax software download   The period described above has been extended for victims of the Oklahoma City attack. 2011 tax software download Survivors and personal representatives of these victims have until January 22, 2003, to file an original or amended return. 2011 tax software download How To Claim Tax Forgiveness Use the following procedures to claim income tax forgiveness. 2011 tax software download Which Form To Use The form you use depends on whether an income tax return for the eligible year was already filed for the decedent. 2011 tax software download Return required but not yet filed. 2011 tax software download   File Form 1040 if the decedent was a U. 2011 tax software download S. 2011 tax software download citizen or resident. 2011 tax software download File Form 1040NR if the decedent was a nonresident alien. 2011 tax software download A nonresident alien is someone who is not a U. 2011 tax software download S. 2011 tax software download citizen or resident. 2011 tax software download Return required and already filed. 2011 tax software download   File a separate Form 1040X for each year you are claiming tax relief. 2011 tax software download Return not required and not filed. 2011 tax software download   File Form 1040 only for the year of death if the decedent was a U. 2011 tax software download S. 2011 tax software download citizen or resident. 2011 tax software download File Form 1040NR if the decedent was a nonresident alien. 2011 tax software download Return not required but already filed. 2011 tax software download   File Form 1040X only for the year of death. 2011 tax software download How to complete the returns. 2011 tax software download   Fill out Form 1040 or 1040NR according to its instructions but do not reduce the decedent's tax liability by any taxes that will be forgiven. 2011 tax software download Attach to each return a computation of the income tax to be forgiven or a copy of Worksheet A or B. 2011 tax software download If filing Form 1040 or Form 1040NR, also attach any Forms W–2. 2011 tax software download If the total forgiven tax liability for all eligible years is less than $10,000, attach to the decedent's final return a computation of the additional tax payment allowed or a copy of Worksheet C. 2011 tax software download Also, please write one of the following across the top of page 1 of each return. 2011 tax software download KITA—Oklahoma City KITA—9/11 KITA—Anthrax “KITA” means “killed in terrorist attack. 2011 tax software download ” Need a copy of a previously filed return?   You will find it easier to prepare Form 1040X if you have a copy of the decedent's previously filed tax return. 2011 tax software download If you need a copy, use Form 4506. 2011 tax software download The IRS will provide a free copy of the tax return if you write “DISASTER” in the top margin of Form 4506. 2011 tax software download Attach Letters Testamentary or other evidence to establish that you are authorized to act for the decedent's estate. 2011 tax software download Send Form 4506 to the address shown in the form instructions. 2011 tax software download Taxpayer identification number. 2011 tax software download   A taxpayer identification number must be furnished on the decedent's returns. 2011 tax software download This is usually the decedent's social security number (SSN). 2011 tax software download However, a nonresident alien who is not eligible to get an SSN should have an individual taxpayer identification number (ITIN). 2011 tax software download If the decedent was a nonresident alien, had neither an SSN nor an ITIN, and was not required to file a U. 2011 tax software download S. 2011 tax software download income tax return for any tax year, do not apply for an ITIN. 2011 tax software download You may claim a refund by filing Form 1040NR without an SSN or ITIN. 2011 tax software download Necessary Documents Please attach the following documents to the return or amended return. 2011 tax software download Proof of death. 2011 tax software download   Attach a copy of the death certificate. 2011 tax software download If the Department of Defense issued DD Form 1300, Report of Casualty, you can attach that form instead of the death certificate. 2011 tax software download Form 1310. 2011 tax software download   You must send Form 1310 with all returns and claims for refund, unless either of the following applies. 2011 tax software download You are a surviving spouse filing an original or amended joint return with the decedent. 2011 tax software download You are a personal representative filing an original Form 1040 or Form 1040NR for the decedent and a court certificate showing your appointment is attached to the return. 2011 tax software download A personal representative is an executor or administrator of a decedent's estate, as certified or appointed by the court. 2011 tax software download A copy of the decedent's will cannot be accepted as evidence that you are the personal representative. 2011 tax software download      If you have proof of death but do not have enough tax information to file a timely claim for a refund, file Form 1040X with Form 1310. 2011 tax software download Include a statement saying an amended return will be filed as soon as the necessary tax information is available. 2011 tax software download Where To File The IRS has set up a special office for processing returns and claims for tax forgiveness. 2011 tax software download Use one of the addresses shown below. 2011 tax software download Where you file the returns or claims depends on whether you use the U. 2011 tax software download S. 2011 tax software download Postal Service or a private delivery service. 2011 tax software download Please do not send these returns or claims to any of the addresses shown in the tax form instructions. 2011 tax software download U. 2011 tax software download S. 2011 tax software download Postal Service. 2011 tax software download   If you use the U. 2011 tax software download S. 2011 tax software download Postal Service, file these returns and claims at the following address. 2011 tax software download Internal Revenue Service P. 2011 tax software download O. 2011 tax software download Box 4053 Woburn, MA 01888 Private delivery service. 2011 tax software download   Private delivery services cannot deliver items to P. 2011 tax software download O. 2011 tax software download boxes. 2011 tax software download If you use a private delivery service, file these returns and claims at the following address. 2011 tax software download Internal Revenue Service Stop 661 310 Lowell St. 2011 tax software download Andover, MA 01810 Designated private delivery services. 2011 tax software download   You can use the following private delivery services to file these returns and claims. 2011 tax software download Airborne Express (Airborne): Overnight Air Express Service, Next Afternoon Service, and Second Day Service. 2011 tax software download DHL Worldwide Express (DHL): DHL “Same Day” Service, and DHL USA Overnight. 2011 tax software download Federal Express (FedEx): FedEx Priority Overnight, FedEx Standard Overnight, and FedEx 2Day. 2011 tax software download United Parcel Service (UPS): UPS Next Day Air, UPS Next Day Air Saver, UPS 2nd Day Air, UPS 2nd Day Air A. 2011 tax software download M. 2011 tax software download , UPS Worldwide Express Plus, and UPS Worldwide Express. 2011 tax software download The private delivery service can tell you how to get written proof of the mailing date. 2011 tax software download Payments to Survivors The following section discusses the tax treatment of certain amounts received by survivors. 2011 tax software download September 11th Victim Compensation Fund of 2001 Payments from the September 11th Victim Compensation Fund of 2001 are not included in income. 2011 tax software download Qualified Disaster Relief Payments Qualified disaster relief payments are not included in income. 2011 tax software download These payments are not subject to income tax, self-employment tax, or employment taxes (social security, Medicare, and federal unemployment taxes). 2011 tax software download No withholding applies to these payments. 2011 tax software download Qualified disaster relief payments include payments you receive (regardless of the source) after September 10, 2001, for the following expenses. 2011 tax software download Reasonable and necessary personal, family, living, or funeral expenses incurred as a result of a terrorist attack. 2011 tax software download Reasonable and necessary expenses incurred for the repair or rehabilitation of a personal residence due to a terrorist attack. 2011 tax software download (A personal residence can be a rented residence or one you own. 2011 tax software download ) Reasonable and necessary expenses incurred for the repair or replacement of the contents of a personal residence due to a terrorist attack. 2011 tax software download Qualified disaster relief payments also include the following. 2011 tax software download Payments made by common carriers (for example, American Airlines and United Airlines regarding the September 11 attacks) because of death or physical injury incurred as a result of a terrorist attack. 2011 tax software download Amounts paid by a federal, state, or local government in connection with a terrorist attack to those affected by the attack. 2011 tax software download Qualified disaster relief payments do not include: Insurance or other reimbursements for expenses, or Income replacement payments, such as payments of lost wages, lost business income, or unemployment compensation. 2011 tax software download Disability Payments For tax years ending after September 10, 2001, disability payments for injuries incurred as a direct result of a terrorist attack directed against the United States (or its allies), whether outside or within the United States, are not included in income. 2011 tax software download Death Benefits Payments received by an individual or the estate of a decedent from the employer of an employee who died as a result of the Oklahoma City or September 11 terrorist attacks, or as a result of the anthrax attacks, are not included in income. 2011 tax software download Only the amount that exceeds the benefits that would have been payable if the death had occurred for a reason other than a terrorist or anthrax attack is excludable. 2011 tax software download However, the exclusion does apply to incidental death benefits paid under a qualified retirement plan even if these amounts would have been payable if the death had occurred for a reason other than a terrorist or anthrax attack. 2011 tax software download If you included death benefits in income on a previously filed return and they are now excludable under the above rule, file Form 1040X to amend that return. 2011 tax software download For information on the period for filing Form 1040X, see Period for filing claim for credit or refund earlier under Refund of Taxes Paid. 2011 tax software download If that period has expired, you are granted an extension. 2011 tax software download You have until January 22, 2003, to file Form 1040X to exclude the death benefits. 2011 tax software download On top of page 1 of Form 1040X, write “Extension of Limitations Under PL 107–134, sec. 2011 tax software download 102(b)(2). 2011 tax software download ” Canceled Debt Canceled debt is not included in your income (or the income of the estate) if: You (or the estate) were liable, or became liable, for the debt of a decedent, and The debt was canceled after September 10, 2001, and before January 1, 2002, because the decedent died as a result of the September 11 attacks or anthrax attacks. 2011 tax software download The lender is not required to report the canceled debt on Form 1099–C, Cancellation of Debt. 2011 tax software download Payments to Survivors of Public Safety Officers If you are a survivor of a public safety officer who died in the line of duty, certain amounts you receive are not included in income. 2011 tax software download Bureau of Justice Assistance payments. 2011 tax software download   If you are a surviving dependent of a public safety officer (law enforcement officer or firefighter) who died in the line of duty, do not include in your income the death benefit paid to you by the Bureau of Justice Assistance. 2011 tax software download Government plan annuity. 2011 tax software download   If you receive a survivor annuity as the child or spouse (or former spouse) of a public safety officer who was killed in the line of duty, you generally do not have to include it in income. 2011 tax software download This exclusion applies to the amount of the annuity based on the officer's service as a public safety officer. 2011 tax software download For this purpose, the term public safety officer includes police and law enforcement officers, firefighters, and rescue squad and ambulance crews. 2011 tax software download More information. 2011 tax software download   For more information, see Publication 559. 2011 tax software download Postponed Tax Deadlines The IRS may postpone for up to 1 year certain tax deadlines of taxpayers who are affected by a terrorist attack. 2011 tax software download The tax deadlines the IRS may postpone include those for filing income and employment tax returns, paying income and employment taxes, and making contributions to a traditional IRA or Roth IRA. 2011 tax software download If any tax deadline is postponed, the IRS will publicize the postponement in the affected area and publish a news release, revenue ruling, revenue procedure, notice, announcement, or other guidance in the Internal Revenue Bulletin (IRB). 2011 tax software download Affected taxpayers. 2011 tax software download   If the IRS postpones a tax deadline, the following taxpayers are eligible for the postponement. 2011 tax software download Any individual whose main home is located in a covered area (defined later). 2011 tax software download Any business entity or sole proprietor whose principal place of business is located in a covered area. 2011 tax software download Any individual, business entity, or sole proprietor whose records needed to meet a postponed deadline are maintained in a covered area. 2011 tax software download The main home or principal place of business does not have to be located in the covered area. 2011 tax software download Any estate or trust whose tax records necessary to meet a postponed tax deadline are maintained in a covered area. 2011 tax software download Any individual who is a relief worker affiliated with a recognized government or philanthropic organization and who is assisting in a covered area. 2011 tax software download The spouse on a joint return with a taxpayer who is eligible for postponements. 2011 tax software download Any other person determined by the IRS to be affected by a terrorist attack. 2011 tax software download Covered area. 2011 tax software download   This is an area in which a terrorist attack took place and in which the IRS has decided to postpone tax deadlines for up to 1 year. 2011 tax software download Abatement of interest. 2011 tax software download   The IRS may abate (forgive) the interest on any underpaid income tax for the length of any postponement. 2011 tax software download Disaster Area Losses If your property was damaged or destroyed as a result of the September 11 attacks, you can choose to deduct your disaster loss on your 2000 return (or amended return) rather than on your 2001 return. 2011 tax software download You must make this choice to deduct your loss on your 2000 return by the later of the following dates. 2011 tax software download The due date (without extensions) for filing your 2001 income tax return (April 15, 2002, if you are a calendar year taxpayer). 2011 tax software download The due date (with extensions) for the 2000 return. 2011 tax software download For more information about disaster area losses, see Publication 547. 2011 tax software download Estate Tax Reduction The federal estate tax is reduced for taxable estates of individuals who died as a result of the Oklahoma City attack, the September 11 attacks, and the anthrax attacks. 2011 tax software download The estate tax is computed using a new rate schedule on page 25 of the November 2001 revision of the instructions for Form 706. 2011 tax software download The estate tax is reduced by credits against the estate tax, including the unified credit and the state death tax credit. 2011 tax software download These credits may reduce or eliminate the estate tax due. 2011 tax software download A special rule extends until January 22, 2003, the period of time allowed to file a claim for a refund of estate taxes that have been paid. 2011 tax software download Recovery from the September 11th Victim Compensation Fund. 2011 tax software download   The value of claims for a decedent's pain and suffering is normally included in the gross estate. 2011 tax software download However, if the estate chooses to seek recovery from this fund, the IRS has determined that, in view of the unique circumstances of this situation and the high likelihood that such claims will be valued at a nominal or zero amount, the claims will be valued at zero for estate tax purposes. 2011 tax software download Thus, there are no federal estate tax consequences if an estate or beneficiary receives a recovery from this fund. 2011 tax software download Which estates must file a return. 2011 tax software download   For decedents dying in 2001, Form 706 must be filed by the executor for the estate of every U. 2011 tax software download S. 2011 tax software download citizen or resident whose gross estate, plus adjusted taxable gifts and specific exemption, is more than $675,000. 2011 tax software download Form 706 must be filed within 9 months after the date of decedent's death unless you receive an extension of time to file. 2011 tax software download Use Form 4768, Application for Extension of Time To File a Return and/or Pay U. 2011 tax software download S. 2011 tax software download Estate (and Generation-Skipping Transfer) Taxes, to apply for an extension. 2011 tax software download Where to file. 2011 tax software download   Returns on which the new rate schedule is used should be sent to the following address, which was not available when Form 706 went to print. 2011 tax software download Internal Revenue Service E & G Department/Stop 824T 201 W. 2011 tax software download Rivercenter Blvd. 2011 tax software download Covington, KY 41011 More information. 2011 tax software download   For more information on the federal estate tax, see the instructions for Form 706. 2011 tax software download Structured Settlement Factoring Transactions A person who acquires payment rights in a structured settlement arrangement after February 21, 2002, may be subject to a 40% excise tax unless the transfer of the payment rights was approved in advance in a qualified order. 2011 tax software download The excise tax is figured on the excess of the undiscounted amount of the payments being acquired over the total amount actually paid to acquire them. 2011 tax software download However, this tax will not apply to transactions entered into from February 22, 2002, to July 1, 2002, if certain requirements are met. 2011 tax software download For information about these requirements, see Internal Revenue Code section 5891. 2011 tax software download Worksheet B Illustrated. 2011 tax software download Figuring the Tax To Be Forgiven (For Decedents Who Filed a Joint Return)       (A) First Eligible Year (1994 or 2000) (B) Second Eligible Year (1995 or 2001) (C) Third Eligible Year (1996 or 2002) 1 Enter the years eligible for forgiveness. 2011 tax software download 1 2000 2001   2 Enter the decedent's taxable income. 2011 tax software download Figure taxable income as if a separate return had been filed. 2011 tax software download See the instructions. 2011 tax software download 2 $17,259 $14,295   3 Enter the decedent's total tax. 2011 tax software download See the instructions. 2011 tax software download 3 6,123 5,250   4 Enter the total, if any, of the decedent's taxes not eligible for forgiveness. 2011 tax software download See the instructions. 2011 tax software download 4 3,532 3,109   5 Subtract line 4 from line 3. 2011 tax software download 5 2,591 2,141   6 Enter the surviving spouse's taxable income. 2011 tax software download Figure taxable income as if a separate return had been filed. 2011 tax software download See the instructions for line 2. 2011 tax software download 6 29,025 29,850   7 Enter the surviving spouse's total tax. 2011 tax software download See the instructions. 2011 tax software download 7 5,277 5,391   8 Enter the total, if any, of the surviving spouse's taxes listed in the instructions for line 4. 2011 tax software download 8 0 0   9 Subtract line 8 from line 7. 2011 tax software download 9 5,277 5,391   10 Add lines 5 and 9. 2011 tax software download 10 7,868 7,532   11 Enter the total tax from the joint return. 2011 tax software download See Table 1 on page 5 for the line number for years before 2002. 2011 tax software download 11 10,789 9,728   12 Add lines 4 and 8. 2011 tax software download 12 3,532 3,109   13 Subtract line 12 from line 11. 2011 tax software download 13 7,257 6,619   14 Divide line 5 by line 10. 2011 tax software download Enter the result as a decimal. 2011 tax software download 14 . 2011 tax software download 329 . 2011 tax software download 284   15 Tax to be forgiven. 2011 tax software download Multiply line 13 by line 14 and enter the result. 2011 tax software download 15 $2,388 $1,880   Note. 2011 tax software download If the total of columns (A), (B), and (C) of line 15 (including any amounts shown on line 5 of Worksheet A) is less than $10,000, also complete Worksheet C. 2011 tax software download Attach the computation of the tax to be forgiven or a copy of this worksheet to the decedent's final income tax return or amended tax return (Form 1040X) for each year listed on line 1. 2011 tax software download If filing Form 1040X for an eligible year, enter the amount from line 15 above on Form 1040X in column B of line 10 as a decrease in tax. 2011 tax software download The IRS will determine the amount to be refunded. 2011 tax software download Worksheet B Illustrated. 2011 tax software download Figuring the Tax To Be Forgiven (For Decedents Who Filed a Joint Return)       (A) First Eligible Year (1994 or 2000) (B) Second Eligible Year (1995 or 2001) (C) Third Eligible Year (1996 or 2002) 1 Enter the years eligible for forgiveness. 2011 tax software download 1 2000 2001   2 Enter the decedent's taxable income. 2011 tax software download Figure taxable income as if a separate return had been filed. 2011 tax software download See the instructions. 2011 tax software download 2 $17,259 $14,295   3 Enter the decedent's total tax. 2011 tax software download See the instructions. 2011 tax software download 3 6,123 5,250   4 Enter the total, if any, of the decedent's taxes not eligible for forgiveness. 2011 tax software download See the instructions. 2011 tax software download 4 3,532 3,109   5 Subtract line 4 from line 3. 2011 tax software download 5 2,591 2,141   6 Enter the surviving spouse's taxable income. 2011 tax software download Figure taxable income as if a separate return had been filed. 2011 tax software download See the instructions for line 2. 2011 tax software download 6 29,025 29,850   7 Enter the surviving spouse's total tax. 2011 tax software download See the instructions. 2011 tax software download 7 5,277 5,391   8 Enter the total, if any, of the surviving spouse's taxes listed in the instructions for line 4. 2011 tax software download 8 0 0   9 Subtract line 8 from line 7. 2011 tax software download 9 5,277 5,391   10 Add lines 5 and 9. 2011 tax software download 10 7,868 7,532   11 Enter the total tax from the joint return. 2011 tax software download See Table 1 on page 5 for the line number for years before 2002. 2011 tax software download 11 10,789 9,728   12 Add lines 4 and 8. 2011 tax software download 12 3,532 3,109   13 Subtract line 12 from line 11. 2011 tax software download 13 7,257 6,619   14 Divide line 5 by line 10. 2011 tax software download Enter the result as a decimal. 2011 tax software download 14 . 2011 tax software download 329 . 2011 tax software download 284   15 Tax to be forgiven. 2011 tax software download Multiply line 13 by line 14 and enter the result. 2011 tax software download 15 $2,388 $1,880   Note. 2011 tax software download If the total of columns (A), (B), and (C) of line 15 (including any amounts shown on line 5 of Worksheet A) is less than $10,000, also complete Worksheet C. 2011 tax software download Attach the computation of the tax to be forgiven or a copy of this worksheet to the decedent's final income tax return or amended tax return (Form 1040X) for each year listed on line 1. 2011 tax software download If filing Form 1040X for an eligible year, enter the amount from line 15 above on Form 1040X in column B of line 10 as a decrease in tax. 2011 tax software download The IRS will determine the amount to be refunded. 2011 tax software download Illustrated Worksheets B and C A wife lost her husband in the September 11 attack on the World Trade Center. 2011 tax software download They filed a joint return for 2000 and the wife chose to file a joint return as a surviving spouse for 2001. 2011 tax software download The returns for 2000 and 2001 showed the following income, deductions, and tax liabilities. 2011 tax software download After the husband died, his estate received income of $4,000. 2011 tax software download Of that amount, $1,000 is net profit from Schedule C received before the end of 2001. 2011 tax software download This net profit is exempt from income tax as explained earlier under Income received after date of death. 2011 tax software download The wife files Form 1041 because the gross income of the estate for the tax year ($3,000) is $600 or more. 2011 tax software download To determine how much of the husband's tax liability for 2000 and 2001 is to be forgiven, the wife completes Worksheet B. 2011 tax software download She also completes Worksheet C because the forgiven tax liabilities for 2000 and 2001 (line 15 of Worksheet B) total less than $10,000. 2011 tax software download To claim tax relief for 2000, the wife files Form 1040X and attaches a copy of Worksheet B. 2011 tax software download To claim tax relief for 2001, she files Form 1040 and attaches copies of Worksheets B and C. 2011 tax software download   2000 2001 Wages (wife) $35,000 $36,000 Net profit from Schedule C, Profit or Loss From Business (husband) 25,000 22,000 Interest income (joint account) 1,000 1,100 Deduction for ½ of self-employment tax (husband) (1,766) (1,555) Standard deduction (7,350) (7,600) Personal exemptions (2) (5,600) (5,800) Taxable income $46,284 $44,145 Joint income tax liability $7,257 $6,619 Plus: Self-employment tax (husband) 3,532 3,109 Total tax liability $10,789 $9,728   2000 2001 Wages (wife) $35,000 $36,000 Net profit from Schedule C, Profit or Loss From Business (husband) 25,000 22,000 Interest income (joint account) 1,000 1,100 Deduction for ½ of self-employment tax (husband) (1,766) (1,555) Standard deduction (7,350) (7,600) Personal exemptions (2) (5,600) (5,800) Taxable income $46,284 $44,145 Joint income tax liability $7,257 $6,619 Plus: Self-employment tax (husband) 3,532 3,109 Total tax liability $10,789 $9,728 Worksheet C Illustrated. 2011 tax software download Amount Treated as Tax Payment for Decedent's Last Tax Year Caution: The decedent is entitled to minimum relief of $10,000. 2011 tax software download Complete this worksheet only if the total tax forgiven for all eligible years is less than $10,000. 2011 tax software download 1 Minimum relief amount. 2011 tax software download Note: Before completing lines 2–9, see Instructions for lines 2–9 of Worksheet C. 2011 tax software download 1 $10,000 2 Enter the taxable income from line 22 (Form 1041) 2 2,400     3 Enter the distribution deduction from line 18 (Form 1041) . 2011 tax software download 3 0     4 Add lines 2 and 3. 2011 tax software download 4 2,400     5 Enter exempt income received after death minus expenses allocable to exempt income. 2011 tax software download (See Income received after date of death on page 5. 2011 tax software download ) 5 1,000     6 Add lines 4 and 5. 2011 tax software download 6 3,400     7 Figure the tax on line 6 using Schedule G (Form 1041). 2011 tax software download 7 710     8 Figure the tax on line 4 using Schedule G (Form 1041). 2011 tax software download 8 435     9 Tax on exempt income. 2011 tax software download Subtract line 8 from line 7. 2011 tax software download 9 275     10 Enter the total of columns (A)–(C) from line 5 of Worksheet A or line 15 of Worksheet B. 2011 tax software download If the decedent was not required to file tax returns for the eligible tax years, enter -0-. 2011 tax software download 10 4,268     11 Add lines 9 and 10. 2011 tax software download 11 $4,543 12 Additional payment allowed. 2011 tax software download If line 11 is $10,000 or more, enter -0- and stop here. 2011 tax software download No additional amount is allowed as a tax payment. 2011 tax software download Otherwise, subtract line 11 from line 1 and enter the result. 2011 tax software download 12 $5,457 Note. 2011 tax software download The amount on line 12 is allowed as a tax payment for the decedent's last tax year (usually 1995 or 2001). 2011 tax software download Attach the computation of the additional payment allowed or a copy of this worksheet to the original or amended income tax return for the decedent's last tax year. 2011 tax software download If filing Form 1040, include the amount from line 12 above on the “Other payments” line of the form. 2011 tax software download Write "Sec. 2011 tax software download 692(d)(2) Payment" and the amount to the right of the entry space. 2011 tax software download Also indicate whether a Form 1041 is being filed for the decedent's estate. 2011 tax software download If filing Form 1040X, include the amount from line 12 above on Form 1040X on line 15, columns (B) and (C). 2011 tax software download Write “Sec. 2011 tax software download 692(d)(2) Payment” on the dotted line to the left of the entry space. 2011 tax software download Worksheet C Illustrated. 2011 tax software download Amount Treated as Tax Payment for Decedent's Last Tax Year Caution: The decedent is entitled to minimum relief of $10,000. 2011 tax software download Complete this worksheet only if the total tax forgiven for all eligible years is less than $10,000. 2011 tax software download 1 Minimum relief amount. 2011 tax software download Note: Before completing lines 2–9, see Instructions for lines 2–9 of Worksheet C. 2011 tax software download 1 $10,000 2 Enter the taxable income from line 22 (Form 1041) 2 2,400     3 Enter the distribution deduction from line 18 (Form 1041) . 2011 tax software download 3 0     4 Add lines 2 and 3. 2011 tax software download 4 2,400     5 Enter exempt income received after death minus expenses allocable to exempt income. 2011 tax software download (See Income received after date of death on page 5. 2011 tax software download ) 5 1,000     6 Add lines 4 and 5. 2011 tax software download 6 3,400     7 Figure the tax on line 6 using Schedule G (Form 1041). 2011 tax software download 7 710     8 Figure the tax on line 4 using Schedule G (Form 1041). 2011 tax software download 8 435     9 Tax on exempt income. 2011 tax software download Subtract line 8 from line 7. 2011 tax software download 9 275     10 Enter the total of columns (A)–(C) from line 5 of Worksheet A or line 15 of Worksheet B. 2011 tax software download If the decedent was not required to file tax returns for the eligible tax years, enter -0-. 2011 tax software download 10 4,268     11 Add lines 9 and 10. 2011 tax software download 11 $4,543 12 Additional payment allowed. 2011 tax software download If line 11 is $10,000 or more, enter -0- and stop here. 2011 tax software download No additional amount is allowed as a tax payment. 2011 tax software download Otherwise, subtract line 11 from line 1 and enter the result. 2011 tax software download 12 $5,457 Note. 2011 tax software download The amount on line 12 is allowed as a tax payment for the decedent's last tax year (usually 1995 or 2001). 2011 tax software download Attach the computation of the additional payment allowed or a copy of this worksheet to the original or amended income tax return for the decedent's last tax year. 2011 tax software download If filing Form 1040, include the amount from line 12 above on the “Other payments” line of the form. 2011 tax software download Write "Sec. 2011 tax software download 692(d)(2) Payment" and the amount to the right of the entry space. 2011 tax software download Also indicate whether a Form 1041 is being filed for the decedent's estate. 2011 tax software download If filing Form 1040X, include the amount from line 12 above on Form 1040X on line 15, columns (B) and (C). 2011 tax software download Write “Sec. 2011 tax software download 692(d)(2) Payment” on the dotted line to the left of the entry space. 2011 tax software download Additional Worksheets The following additional worksheets are provided for your convenience. 2011 tax software download Worksheet A. 2011 tax software download Figuring the Tax To Be Forgiven (For Decedents Who Filed a Return as Single, Married Filing Separately, Head of Household, or Qualifying Widow(er))         (A) First Eligible Year (1994 or 2000) (B) Second Eligible Year (1995 or 2001) (C) Third Eligible Year (1996 or 2002) 1 Enter the years eligible for tax forgiveness. 2011 tax software download 1       2 Enter the total tax from the decedent's income tax return. 2011 tax software download See Table 1 on page 5 for the line number for years before 2002. 2011 tax software download 2       3 Enter the following taxes, if any, shown on the decedent's income tax return. 2011 tax software download (These taxes are not eligible for forgiveness. 2011 tax software download )           a Self-employment tax. 2011 tax software download 3a         b Social security and Medicare tax on tip income not reported to employer. 2011 tax software download 3b         c Tax on excess contributions to IRAs, Coverdell education savings accounts (formerly Ed IRAs), or Archer MSAs (formerly medical savings accounts). 2011 tax software download 3c         d Tax on excess accumulation in qualified retirement plans. 2011 tax software download 3d         e Household employment taxes. 2011 tax software download 3e         f Uncollected social security and Medicare or RRTA tax on tips or group-term life insurance. 2011 tax software download 3f         g Tax on golden parachute payments. 2011 tax software download 3g       4 Add lines 3a through 3g. 2011 tax software download 4       5 Tax to be forgiven. 2011 tax software download Subtract line 4 from line 2. 2011 tax software download 5       Note. 2011 tax software download If the total of columns (A), (B), and (C) of line 5 (including any amounts shown on line 15 of Worksheet B) is less than $10,000, also complete Worksheet C. 2011 tax software download Attach the computation of the tax to be forgiven or a copy of this worksheet to the decedent's final income tax return or amended tax return (Form 1040X) for each year listed on line 1. 2011 tax software download If filing Form 1040X for an eligible year, enter the amount from line 5 above on Form 1040X in column B of line 10 as a decrease in tax. 2011 tax software download The IRS will determine the amount to be refunded. 2011 tax software download Worksheet A. 2011 tax software download Figuring the Tax To Be Forgiven (For Decedents Who Filed a Return as Single, Married Filing Separately, Head of Household, or Qualifying Widow(er))         (A) First Eligible Year (1994 or 2000) (B) Second Eligible Year (1995 or 2001) (C) Third Eligible Year (1996 or 2002) 1 Enter the years eligible for tax forgiveness. 2011 tax software download 1       2 Enter the total tax from the decedent's income tax return. 2011 tax software download See Table 1 on page 5 for the line number for years before 2002. 2011 tax software download 2       3 Enter the following taxes, if any, shown on the decedent's income tax return. 2011 tax software download (These taxes are not eligible for forgiveness. 2011 tax software download )           a Self-employment tax. 2011 tax software download 3a         b Social security and Medicare tax on tip income not reported to employer. 2011 tax software download 3b         c Tax on excess contributions to IRAs, Coverdell education savings accounts (formerly Ed IRAs), or Archer MSAs (formerly medical savings accounts). 2011 tax software download 3c         d Tax on excess accumulation in qualified retirement plans. 2011 tax software download 3d         e Household employment taxes. 2011 tax software download 3e         f Uncollected social security and Medicare or RRTA tax on tips or group-term life insurance. 2011 tax software download 3f         g Tax on golden parachute payments. 2011 tax software download 3g       4 Add lines 3a through 3g. 2011 tax software download 4       5 Tax to be forgiven. 2011 tax software download Subtract line 4 from line 2. 2011 tax software download 5       Note. 2011 tax software download If the total of columns (A), (B), and (C) of line 5 (including any amounts shown on line 15 of Worksheet B) is less than $10,000, also complete Worksheet C. 2011 tax software download Attach the computation of the tax to be forgiven or a copy of this worksheet to the decedent's final income tax return or amended tax return (Form 1040X) for each year listed on line 1. 2011 tax software download If filing Form 1040X for an eligible year, enter the amount from line 5 above on Form 1040X in column B of line 10 as a decrease in tax. 2011 tax software download The IRS will determine the amount to be refunded. 2011 tax software download Worksheet B. 2011 tax software download Figuring the Tax To Be Forgiven (For Decedents Who Filed a Joint Return)       (A) First Eligible Year (1994 or 2000) (B) Second Eligible Year (1995 or 2001) (C) Third Eligible Year (1996 or 2002) 1 Enter the years eligible for forgiveness. 2011 tax software download 1       2 Enter the decedent's taxable income. 2011 tax software download Figure taxable income as if a separate return had been filed. 2011 tax software download See the instructions. 2011 tax software download 2       3 Enter the decedent's total tax. 2011 tax software download See the instructions. 2011 tax software download 3       4 Enter the total, if any, of the decedent's taxes not eligible for forgiveness. 2011 tax software download See the instructions. 2011 tax software download 4       5 Subtract line 4 from line 3. 2011 tax software download 5       6 Enter the surviving spouse's taxable income. 2011 tax software download Figure taxable income as if a separate return had been filed. 2011 tax software download See the instructions. 2011 tax software download 6       7 Enter the surviving spouse's total tax. 2011 tax software download See the instructions. 2011 tax software download 7       8 Enter the total, if any, of the surviving spouse's taxes listed in the instructions for line 4. 2011 tax software download 8       9 Subtract line 8 from line 7. 2011 tax software download 9       10 Add lines 5 and 9. 2011 tax software download 10       11 Enter the total tax from the joint return. 2011 tax software download See Table 1 on page 5 for the line number for years before 2002. 2011 tax software download 11       12 Add lines 4 and 8. 2011 tax software download 12       13 Subtract line 12 from line 11. 2011 tax software download 13       14 Divide line 5 by line 10. 2011 tax software download Enter the result as a decimal. 2011 tax software download 14       15 Tax to be forgiven. 2011 tax software download Multiply line 13 by line 14 and enter the result. 2011 tax software download 15       Note. 2011 tax software download If the total of columns (A), (B), and (C) of line 15 (including any amounts shown on line 5 of Worksheet A) is less than $10,000, also complete Worksheet C. 2011 tax software download Attach the computation of the tax to be forgiven or a copy of this worksheet to the decedent's final income tax return or amended tax return (Form 1040X) for each year listed on line 1. 2011 tax software download If filing Form 1040X for an eligible year, enter the amount from line 15 above on Form 1040X in column B of line 10 as a decrease in tax. 2011 tax software download The IRS will determine the amount to be refunded. 2011 tax software download Worksheet B. 2011 tax software download Figuring the Tax To Be Forgiven (For Decedents Who Filed a Joint Return)       (A) First Eligible Year (1994 or 2000) (B) Second Eligible Year (1995 or 2001) (C) Third Eligible Year (1996 or 2002) 1 Enter the years eligible for forgiveness. 2011 tax software download 1       2 Enter the decedent's taxable income. 2011 tax software download Figure taxable income as if a separate return had been filed. 2011 tax software download See the instructions. 2011 tax software download 2       3 Enter the decedent's total tax. 2011 tax software download See the instructions. 2011 tax software download 3       4 Enter the total, if any, of the decedent's taxes not eligible for forgiveness. 2011 tax software download See the instructions. 2011 tax software download 4       5 Subtract line 4 from line 3. 2011 tax software download 5       6 Enter the surviving spouse's taxable income. 2011 tax software download Figure taxable income as if a separate return had been filed. 2011 tax software download See the instructions. 2011 tax software download 6       7 Enter the surviving spouse's total tax. 2011 tax software download See the instructions. 2011 tax software download 7       8 Enter the total, if any, of the surviving spouse's taxes listed in the instructions for line 4. 2011 tax software download 8       9 Subtract line 8 from line 7. 2011 tax software download 9       10 Add lines 5 and 9. 2011 tax software download 10       11 Enter the total tax from the joint return. 2011 tax software download See Table 1 on page 5 for the line number for years before 2002. 2011 tax software download 11       12 Add lines 4 and 8. 2011 tax software download 12       13 Subtract line 12 from line 11. 2011 tax software download 13       14 Divide line 5 by line 10. 2011 tax software download Enter the result as a decimal. 2011 tax software download 14       15 Tax to be forgiven. 2011 tax software download Multiply line 13 by line 14 and enter the result. 2011 tax software download 15       Note. 2011 tax software download If the total of columns (A), (B), and (C) of line 15 (including any amounts shown on line 5 of Worksheet A) is less than $10,000, also complete Worksheet C. 2011 tax software download Attach the computation of the tax to be forgiven or a copy of this worksheet to the decedent's final income tax return or amended tax return (Form 1040X) for each year listed on line 1. 2011 tax software download If filing Form 1040X for an eligible year, enter the amount from line 15 above on Form 1040X in column B of line 10 as a decrease in tax. 2011 tax software download The IRS will determine the amount to be refunded. 2011 tax software download Worksheet C. 2011 tax software download Amount Treated as Tax Payment for Decedent's Last Tax Year Caution: The decedent is entitled to minimum tax forgiveness of $10,000. 2011 tax software download Complete this worksheet only if the total tax forgiven for all eligible years is less than $10,000. 2011 tax software download 1 Minimum tax forgiveness. 2011 tax software download Note. 2011 tax software download Before completing lines 2–9, see Instructions for lines 2–9 of Worksheet C. 2011 tax software download 1 $10,000 2 Enter the taxable income from line 22 (Form 1041) 2       3 Enter the distribution deduction from line 18 (Form 1041) . 2011 tax software download 3       4 Add lines 2 and 3. 2011 tax software download 4       5 Enter exempt income received after death minus expenses allocable to exempt income. 2011 tax software download (See Income received after date of death on page 5. 2011 tax software download ) 5       6 Add lines 4 and 5. 2011 tax software download 6       7 Figure the tax on line 6 using Schedule G (Form 1041). 2011 tax software download 7       8 Figure the tax on line 4 using Schedule G (Form 1041). 2011 tax software download 8       9 Tax on exempt income. 2011 tax software download Subtract line 8 from line 7. 2011 tax software download 9       10 Enter the total of columns (A)–(C) from line 5 of Worksheet A or line 15 of Worksheet B. 2011 tax software download If the decedent was not required to file tax returns for the eligible tax years, enter -0-. 2011 tax software download 10       11 Add lines 9 and 10. 2011 tax software download 11   12 Additional payment allowed. 2011 tax software download If line 11 is $10,000 or more, enter -0- and stop here. 2011 tax software download No additional amount is allowed as a tax payment. 2011 tax software download Otherwise, subtract line 11 from line 1 and enter the result. 2011 tax software download 12   Note. 2011 tax software download The amount on line 12 is allowed as a tax payment for the decedent's last tax year (usually 1995 or 2001). 2011 tax software download Attach the computation of the additional payment allowed or a copy of this worksheet to the original or amended income tax return for the decedent's last tax year. 2011 tax software download If filing Form 1040, include the amount from line 12 above on the “Other payments” line of the form. 2011 tax software download Write "Sec. 2011 tax software download 692(d)(2) Payment" and the amount to the right of the entry space. 2011 tax software download Also indicate whether a Form 1041 is being filed for the decedent's estate. 2011 tax software download If filing Form 1040X, include the amount from line 12 above on Form 1040X on line 15, columns (B) and (C). 2011 tax software download Write “Sec. 2011 tax software download 692(d)(2) Payment” on the dotted line to the left of the entry space. 2011 tax software download Worksheet C. 2011 tax software download Amount Treated as Tax Payment for Decedent's Last Tax Year Caution: The decedent is entitled to minimum tax forgiveness of $10,000. 2011 tax software download Complete this worksheet only if the total tax forgiven for all eligible years is less than $10,000. 2011 tax software download 1 Minimum tax forgiveness. 2011 tax software download Note. 2011 tax software download Before completing lines 2–9, see Instructions for lines 2–9 of Worksheet C. 2011 tax software download 1 $10,000 2 Enter the taxable income from line 22 (Form 1041) 2       3 Enter the distribution deduction from line 18 (Form 1041) . 2011 tax software download 3       4 Add lines 2 and 3. 2011 tax software download 4       5 Enter exempt income received after death minus expenses allocable to exempt income. 2011 tax software download (See Income received after date of death on page 5. 2011 tax software download ) 5       6 Add lines 4 and 5. 2011 tax software download 6       7 Figure the tax on line 6 using Schedule G (Form 1041). 2011 tax software download 7       8 Figure the tax on line 4 using Schedule G (Form 1041). 2011 tax software download 8       9 Tax on exempt income. 2011 tax software download Subtract line 8 from line 7. 2011 tax software download 9       10 Enter the total of columns (A)–(C) from line 5 of Worksheet A or line 15 of Worksheet B. 2011 tax software download If the decedent was not required to file tax returns for the eligible tax years, enter -0-. 2011 tax software download 10       11 Add lines 9 and 10. 2011 tax software download 11   12 Additional payment allowed. 2011 tax software download If line 11 is $10,000 or more, enter -0- and stop here. 2011 tax software download No additional amount is allowed as a tax payment. 2011 tax software download Otherwise, subtract line 11 from line 1 and enter the result. 2011 tax software download 12   Note. 2011 tax software download The amount on line 12 is allowed as a tax payment for the decedent's last tax year (usually 1995 or 2001). 2011 tax software download Attach the computation of the additional payment allowed or a copy of this worksheet to the original or amended income tax return for the decedent's last tax year. 2011 tax software download If filing Form 1040, include the amount from line 12 above on the “Other payments” line of the form. 2011 tax software download Write "Sec. 2011 tax software download 692(d)(2) Payment" and the amount to the right of the entry space. 2011 tax software download Also indicate whether a Form 1041 is being filed for the decedent's estate. 2011 tax software download If filing Form 1040X, include the amount from line 12 above on Form 1040X on line 15, columns (B) and (C). 2011 tax software download Write “Sec. 2011 tax software download 692(d)(2) Payment” on the dotted line to the left of the entry space. 2011 tax software download How To Get Tax Help Special IRS assistance. 2011 tax software download   The IRS is providing special help for those affected by the terrorist attacks, as well as survivors and personal representatives of the victims. 2011 tax software download We have set up a special toll-free number for people who may have trouble filing or paying their taxes because they were affected by the terrorist attacks, or who have other tax issues related to the attacks. 2011 tax software download Call 1–866–562–5227 Monday through Friday In English–7 a. 2011 tax software download m. 2011 tax software download to 10 p. 2011 tax software download m. 2011 tax software download local time In Spanish–8 a. 2011 tax software download m. 2011 tax software download to 9:30 p. 2011 tax software download m. 2011 tax software download local time   The IRS web site at www. 2011 tax software download irs. 2011 tax software download gov has notices and other tax relief information. 2011 tax software download Check it periodically for any new guidance or to see if Congress has enacted new legislation. 2011 tax software download   Business taxpayers affected by the attacks can e-mail their questions to corp. 2011 tax software download disaster. 2011 tax software download relief@irs. 2011 tax software download gov. 2011 tax software download   For current information on Presidentially declared disaster areas, check the Federal Emergency Management Agency Web site at www. 2011 tax software download fema. 2011 tax software download gov. 2011 tax software download Other help from the IRS. 2011 tax software download   You can get help with unresolved tax issues, order free publications and forms, ask tax questions, and get more information from the IRS in several ways. 2011 tax software download By selecting the method that is best for you, you will have quick and easy access to tax help. 2011 tax software download Contacting your Taxpayer Advocate. 2011 tax software download   If you have attempted to deal with an IRS problem unsuccessfully, you should contact your Taxpayer Advocate. 2011 tax software download   The Taxpayer Advocate represents your interests and concerns within the IRS by protecting your rights and resolving problems that have not been fixed through normal channels. 2011 tax software download While Taxpayer Advocates cannot change the tax law or make a technical tax decision, they can clear up problems that resulted from previous contacts and ensure that your case is given a complete and impartial review. 2011 tax software download   To contact your Taxpayer Advocate: Call the Taxpayer Advocate at 1–877–777–4778. 2011 tax software download Call the IRS at 1–800–829–1040. 2011 tax software download Call, write, or fax the Taxpayer Advocate office in your area. 2011 tax software download Call 1–800–829–4059 if you are a TTY/TDD user. 2011 tax software download   For more information, see Publication 1546, The Taxpayer Advocate Service of the IRS. 2011 tax software download Free tax services. 2011 tax software download   To find out what services are available, get Publication 910, Guide to Free Tax Services. 2011 tax software download It contains a list of free tax publications and an index of tax topics. 2011 tax software download It also describes other free tax information services, including tax education and assistance programs and a list of TeleTax topics. 2011 tax software download Personal computer. 2011 tax software download With your personal computer and modem, you can access the IRS on the Internet at www. 2011 tax software download irs. 2011 tax software download gov. 2011 tax software download While visiting our web site, you can: Find answers to questions you may have. 2011 tax software download Download forms and publications or search for forms and pub
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Tax Relief for Victims of Hurricane Irene in Vermont

E-file to Remain Open through Oct. 31 for Irene Victims

Updated 9/16/11 to add a link to Notice 2011-74.
Updated 9/15/11 to add Franklin, Lamoille and Orleans counties.
Updated 9/7/11 to add Caledonia county.
Updated 9/6/11 to add Addison, Bennington, Orange and Windham counties.

VT-2011-34, Sept. 2, 2011

BOSTON — Victims of Hurricane Irene that began on Aug. 29, 2011 in parts of Vermont may qualify for tax relief from the Internal Revenue Service.

The President has declared the following counties a federal disaster area: Addison, Bennington, Caledonia, Chittenden, Franklin, Lamoille, Orleans, Orange, Rutland, Washington, Windham and Windsor. Individuals who reside or have a business in these counties may qualify for tax relief.

The declaration permits the IRS to postpone certain deadlines for taxpayers who reside or have a business in the disaster area. For instance, certain deadlines falling on or after Aug. 29, and on or before Oct. 31, have been postponed to Oct. 31, 2011. This includes corporations and other businesses that previously obtained an extension until Sept. 15 to file their 2010 returns, and individuals and businesses that received a similar extension until Oct. 17. It also includes the estimated tax payment for the third quarter, normally due Sept. 15.  

In addition, the IRS is waiving the failure-to-deposit penalties for employment and excise tax deposits due on or after Aug. 29, and on or before Sept. 13, as long as the deposits are made by Sept. 13, 2011.

If an affected taxpayer receives a penalty notice from the IRS, the taxpayer should call the telephone number on the notice to have the IRS abate any interest and any late filing or late payment penalties that would otherwise apply. Penalties or interest will be abated only for taxpayers who have an original or extended filing, payment or deposit due date, including an extended filing or payment due date, that falls within the postponement period.

The IRS automatically identifies taxpayers located in the covered disaster area and applies automatic filing and payment relief. But affected taxpayers who reside or have a business located outside the covered disaster area must call the IRS disaster hotline at 1-866-562-5227 to request this tax relief.

Covered Disaster Area

The counties listed above constitute a covered disaster area for purposes of Treas. Reg. § 301.7508A-1(d)(2) and are entitled to the relief detailed below.

Affected Taxpayers

Taxpayers considered to be affected taxpayers eligible for the postponement of time to file returns, pay taxes and perform other time-sensitive acts are those taxpayers listed in Treas. Reg. § 301.7508A-1(d)(1), and include individuals who live, and businesses whose principal place of business is located, in the covered disaster area. Taxpayers not in the covered disaster area, but whose records necessary to meet a deadline listed in Treas. Reg. § 301.7508A-1(c) are in the covered disaster area, are also entitled to relief. In addition, all relief workers affiliated with a recognized government or philanthropic organization assisting in the relief activities in the covered disaster area and any individual visiting the covered disaster area who was killed or injured as a result of the disaster are entitled to relief.

Grant of Relief

Under section 7508A, the IRS gives affected taxpayers until Oct. 31 to file most tax returns (including individual, corporate, and estate and trust income tax returns; partnership returns, S corporation returns, and trust returns; estate, gift, and generation-skipping transfer tax returns; and employment and certain excise tax returns), or to make tax payments, including estimated tax payments, that have either an original or extended due date occurring on or after Aug. 29 and on or before Oct. 31.

The IRS also gives affected taxpayers until Oct. 31 to perform other time-sensitive actions described in Treas. Reg. § 301.7508A-1(c)(1) and Rev. Proc. 2007-56, 2007-34 I.R.B. 388 (Aug. 20, 2007), that are due to be performed on or after Aug. 29 and on or before Oct. 31.

This relief also includes the filing of Form 5500 series returns, in the manner described in section 8 of Rev. Proc. 2007-56. The relief described in section 17 of Rev. Proc. 2007-56, pertaining to like-kind exchanges of property, also applies to certain taxpayers who are not otherwise affected taxpayers and may include acts required to be performed before or after the period above.

The postponement of time to file and pay does not apply to information returns in the W-2, 1098, 1099 series, or to Forms 1042-S or 8027. Penalties for failure to timely file information returns can be waived under existing procedures for reasonable cause. Likewise, the postponement does not apply to employment and excise tax deposits. The IRS, however, will abate penalties for failure to make timely employment and excise tax deposits due on or after Aug. 29 and on or before Sept. 13 provided the taxpayer makes these deposits by Sept. 13.

Casualty Losses

Affected taxpayers in a federally declared disaster area have the option of claiming disaster-related casualty losses on their federal income tax return for either this year or last year. Claiming the loss on an original or amended return for last year will get the taxpayer an earlier refund, but waiting to claim the loss on this year’s return could result in a greater tax saving, depending on other income factors.

Individuals may deduct personal property losses that are not covered by insurance or other reimbursements. For details, see Form 4684 and its instructions.

Affected taxpayers claiming the disaster loss on last year’s return should put the Disaster Designation “Vermont /Hurricane Irene” at the top of the form so that the IRS can expedite the processing of the refund.

Other Relief

The IRS will waive the usual fees and expedite requests for copies of previously filed tax returns for affected taxpayers. Taxpayers should put the assigned Disaster Designation in red ink at the top of Form 4506, Request for Copy of Tax Return, or Form 4506-T, Request for Transcript of Tax Return, as appropriate, and submit it to the IRS.

Affected taxpayers who are contacted by the IRS on a collection or examination matter should explain how the disaster impacts them so that the IRS can provide appropriate consideration to their case.

Taxpayers may download forms and publications from the official IRS website, irs.gov, or order them by calling 1-800-TAX-FORM (1-800-829-3676). The IRS toll-free number for general tax questions is 1-800-829-1040.

Related Information

Page Last Reviewed or Updated: 24-Mar-2014

The 2011 Tax Software Download

2011 tax software download 1. 2011 tax software download   Fuel Taxes Table of Contents Definitions Information Returns Registration RequirementsAdditional information. 2011 tax software download Gasoline and Aviation GasolineTaxable Events Gasoline Blendstocks Diesel Fuel and KeroseneTaxable Events Dyed Diesel Fuel and Dyed Kerosene Alaska and Feedstocks Back-up Tax Diesel-Water Fuel Emulsion Kerosene for Use in AviationTaxable Events Liability For Tax Surtax on any liquid used in a fractional ownership program aircraft as fuel Certificate for Commercial Aviation and Exempt UsesExempt use. 2011 tax software download Reseller statement. 2011 tax software download Other Fuels (Including Alternative Fuels)Taxable Events Compressed Natural Gas (CNG)Taxable Events Fuels Used on Inland WaterwaysFishing vessels. 2011 tax software download Deep-draft ocean-going vessels. 2011 tax software download Passenger vessels. 2011 tax software download Ocean-going barges. 2011 tax software download State or local governments. 2011 tax software download Cellulosic or Second Generation Biofuel Not Used as Fuel Biodiesel Sold as But Not Used as Fuel Definitions Excise taxes are imposed on all the following fuels. 2011 tax software download Gasoline, including aviation gasoline and gasoline blendstocks. 2011 tax software download Diesel fuel, including dyed diesel fuel. 2011 tax software download Diesel-water fuel emulsion. 2011 tax software download Kerosene, including dyed kerosene and kerosene used in aviation. 2011 tax software download Other Fuels (including alternative fuels). 2011 tax software download Compressed natural gas (CNG). 2011 tax software download Fuels used in commercial transportation on inland waterways. 2011 tax software download Any liquid used in a fractional ownership program aircraft as fuel. 2011 tax software download The following terms are used throughout the discussion of fuel taxes. 2011 tax software download Other terms are defined in the discussion of the specific fuels to which they pertain. 2011 tax software download Agri-biodiesel. 2011 tax software download   Agri-biodiesel means biodiesel derived solely from virgin oils, including esters derived from virgin vegetable oils from corn, soybeans, sunflower seeds, cottonseeds, canola, crambe, rapeseeds, safflowers, flaxseeds, rice bran, mustard seeds, and camelina, and from animal fats. 2011 tax software download Approved terminal or refinery. 2011 tax software download   This is a terminal operated by a registrant that is a terminal operator or a refinery operated by a registrant that is a refiner. 2011 tax software download Biodiesel. 2011 tax software download   Biodiesel means the monoalkyl esters of long chain fatty acids derived from plant or animal matter that meet the registration requirements for fuels and fuel additives established by the Environmental Protection Agency (EPA) under section 211 of the Clean Air Act, and the requirements of the American Society of Testing Materials (ASTM) D6751. 2011 tax software download Blended taxable fuel. 2011 tax software download   This means any taxable fuel produced outside the bulk transfer/terminal system by mixing taxable fuel on which excise tax has been imposed and any other liquid on which excise tax has not been imposed. 2011 tax software download This does not include a mixture removed or sold during the calendar quarter if all such mixtures removed or sold by the blender contain less than 400 gallons of a liquid on which the tax has not been imposed. 2011 tax software download Blender. 2011 tax software download   This is the person that produces blended taxable fuel. 2011 tax software download Bulk transfer. 2011 tax software download   This is the transfer of taxable fuel by pipeline or vessel. 2011 tax software download Bulk transfer/terminal system. 2011 tax software download   This is the taxable fuel distribution system consisting of refineries, pipelines, vessels, and terminals. 2011 tax 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the time of entry into the United States is the enterer. 2011 tax software download Entry. 2011 tax software download   Taxable fuel is entered into the United States when it is brought into the United States and applicable customs law requires that it be entered for consumption, use, or warehousing. 2011 tax software download This does not apply to fuel brought into Puerto Rico (which is part of the U. 2011 tax software download S. 2011 tax software download customs territory), but does apply to fuel brought into the United States from Puerto Rico. 2011 tax software download Fractional ownership aircraft program and fractional program aircraft. 2011 tax software download   See later, under Surtax on any liquid used in a fractional ownership program aircraft as fuel. 2011 tax software download Measurement of taxable fuel. 2011 tax software download   Volumes of taxable fuel can be measured on the basis of actual volumetric gallons or gallons adjusted to 60 degrees Fahrenheit. 2011 tax software download Other fuels. 2011 tax software download   See Other Fuels (Including Alternative Fuels), later, and Alternative Fuel Credit and Alternative Fuel Mixture Credit in chapter 2. 2011 tax software download Pipeline operator. 2011 tax software download   This is the person that operates a pipeline within the bulk transfer/terminal system. 2011 tax software download Position holder. 2011 tax software download   This is the person that holds the inventory position in the taxable fuel in the terminal, as reflected in the records of the terminal operator. 2011 tax software download You hold the inventory position when you have a contractual agreement with the terminal operator for the use of the storage facilities and terminaling services for the taxable fuel. 2011 tax software download A terminal operator that owns taxable fuel in its terminal is a position holder. 2011 tax software download Rack. 2011 tax software download   This is a mechanism capable of delivering fuel into a means of transport other than a pipeline or vessel. 2011 tax software download Refiner. 2011 tax software download   This is any person that owns, operates, or otherwise controls a refinery. 2011 tax software download Refinery. 2011 tax software download   This is a facility used to produce taxable fuel and from which taxable fuel may be removed by pipeline, by vessel, or at a rack. 2011 tax software download However, this term does not include a facility where only blended fuel, and no other type of fuel, is produced. 2011 tax software download For this purpose, blended fuel is any mixture that would be blended taxable fuel if produced outside the bulk transfer/terminal system. 2011 tax software download Registrant. 2011 tax software download   This is a taxable fuel registrant (see Registration Requirements, later). 2011 tax software download Removal. 2011 tax software download   This is any physical transfer of taxable fuel. 2011 tax software download It also means any use of taxable fuel other than as a material in the production of taxable fuel or Other Fuels. 2011 tax software download However, taxable fuel is not removed when it evaporates or is otherwise lost or destroyed. 2011 tax software download Renewable diesel. 2011 tax software download   See Renewable Diesel Credits in chapter 2. 2011 tax software download Sale. 2011 tax software download   For taxable fuel not in a terminal, this is the transfer of title to, or substantial incidents of ownership in, taxable fuel to the buyer for money, services, or other property. 2011 tax software download For taxable fuel in a terminal, this is the transfer of the inventory position if the transferee becomes the position holder for that taxable fuel. 2011 tax software download Second generation biofuel. 2011 tax software download   This is any liquid fuel derived by, or from, qualified feedstocks, and meets the registration requirements for fuels and fuel additives established by the Environmental Protection Agency under section 211 of the Clean Air Act (42 U. 2011 tax software download S. 2011 tax software download C. 2011 tax software download 7545). 2011 tax software download It also includes certain liquid fuel which is derived by, or from, any cultivated algae, cyanobacteria, or lemna. 2011 tax software download It is not alcohol of less than 150 proof (disregard any added denaturants). 2011 tax software download See Form 6478 for more information. 2011 tax software download State. 2011 tax software download   This includes any state, any of its political subdivisions, the District of Columbia, and the American Red Cross. 2011 tax software download An Indian tribal government is treated as a state only if transactions involve the exercise of an essential tribal government function. 2011 tax software download Taxable fuel. 2011 tax software download   This means gasoline, diesel fuel, and kerosene. 2011 tax software download Terminal. 2011 tax software download   This is a storage and distribution facility supplied by pipeline or vessel, and from which taxable fuel may be removed at a rack. 2011 tax software download It does not include a facility at which gasoline blendstocks are used in the manufacture of products other than finished gasoline if no gasoline is removed from the facility. 2011 tax software download A terminal does not include any facility where finished gasoline, diesel fuel, or kerosene is stored if the facility is operated by a registrant and all such taxable fuel stored at the facility has been previously taxed upon removal from a refinery or terminal. 2011 tax software download Terminal operator. 2011 tax software download   This is any person that owns, operates, or otherwise controls a terminal. 2011 tax software download Throughputter. 2011 tax software download   This is any person that is a position holder or that owns taxable fuel within the bulk transfer/terminal system (other than in a terminal). 2011 tax software download Vessel operator. 2011 tax software download   This is the person that operates a vessel within the bulk transfer/terminal system. 2011 tax software download However, vessel does not include a deep draft ocean-going vessel. 2011 tax software download Information Returns Form 720-TO and Form 720-CS are information returns used to report monthly receipts and disbursements of liquid products. 2011 tax software download A liquid product is any liquid transported into storage at a terminal or delivered out of a terminal. 2011 tax software download For a list of products, see the product code table in the Instructions for Forms 720-TO and 720-CS. 2011 tax software download The returns are due the last day of the month following the month in which the transaction occurs. 2011 tax software download Generally, these returns can be filed on paper or electronically. 2011 tax software download For information on filing electronically, see Publication 3536, Motor Fuel Excise Tax EDI Guide. 2011 tax software download Publication 3536 is only available on the IRS website. 2011 tax software download Form 720-TO. 2011 tax software download   This information return is used by terminal operators to report receipts and disbursements of all liquid products to and from all approved terminals. 2011 tax software download Each terminal operator must file a separate form for each approved terminal. 2011 tax software download Form 720-CS. 2011 tax software download   This information return must be filed by bulk transport carriers (barges, vessels, and pipelines) who receive liquid product from an approved terminal or deliver liquid product to an approved terminal. 2011 tax software download Registration Requirements The following discussion applies to excise tax registration requirements for activities relating to fuels only. 2011 tax software download See Form 637 for other persons who must register and for more information about registration. 2011 tax software download Persons that are required to be registered. 2011 tax software download   You are required to be registered if you are a: Blender; Enterer; Pipeline operator; Position holder; Refiner; Terminal operator; Vessel operator; Producer or importer of alcohol, biodiesel, agri-biodiesel, and renewable diesel; or Producer of cellulosic or second generation biofuel. 2011 tax software download Persons that may register. 2011 tax software download   You may, but are not required to, register if you are a: Feedstock user, Industrial user, Throughputter that is not a position holder, Ultimate vendor, Diesel-water fuel emulsion producer, Credit card issuer, or Alternative fuel claimant. 2011 tax software download Ultimate vendors, credit card issuers, and alternative fuel claimants do not need to be registered to buy or sell fuel. 2011 tax software download However, they must be registered to file claims for certain sales and uses of fuel. 2011 tax software download See Form 637 for more information. 2011 tax software download Taxable fuel registrant. 2011 tax software download   This is an enterer, an industrial user, a refiner, a terminal operator, or a throughputter who received a Letter of Registration under the excise tax registration provisions and whose registration has not been revoked or suspended. 2011 tax software download The term registrant as used in the discussions of these fuels means a taxable fuel registrant. 2011 tax software download Additional information. 2011 tax software download   See the Form 637 instructions for the information you must submit when you apply for registration. 2011 tax software download Failure to register. 2011 tax software download   The penalty for failure to register if you must register, unless due to reasonable cause, is $10,000 for the initial failure, and then $1,000 each day thereafter you fail to register. 2011 tax software download Gasoline and Aviation Gasoline Gasoline. 2011 tax software download   Gasoline means all products commonly or commercially known or sold as gasoline with an octane rating of 75 or more that are suitable for use as a motor fuel. 2011 tax software download Gasoline includes any gasoline blend other than: Qualified ethanol and methanol fuel (at least 85 percent of the blend consists of alcohol produced from coal, including peat), Partially exempt ethanol and methanol fuel (at least 85 percent of the blend consists of alcohol produced from natural gas), or Denatured alcohol. 2011 tax software download Gasoline also includes gasoline blendstocks, discussed later. 2011 tax software download Aviation gasoline. 2011 tax software download   This means all special grades of gasoline suitable for use in aviation reciprocating engines and covered by ASTM specification D910 or military specification MIL-G-5572. 2011 tax software download Taxable Events The tax on gasoline is $. 2011 tax software download 184 per gallon. 2011 tax software download The tax on aviation gasoline is $. 2011 tax software download 194 per gallon. 2011 tax software download When used in a fractional ownership program aircraft, gasoline also is subject to a surtax of $. 2011 tax software download 141 per gallon. 2011 tax software download See Surtax on any liquid used in a fractional ownership program aircraft as fuel, later. 2011 tax software download Tax is imposed on the removal, entry, or sale of gasoline. 2011 tax software download Each of these events is discussed later. 2011 tax software download Also, see the special rules that apply to gasoline blendstocks, later. 2011 tax software download If the tax is paid on the gasoline in more than one event, a refund may be allowed for the “second” tax paid. 2011 tax software download See Refunds of Second Tax in chapter 2. 2011 tax software download Removal from terminal. 2011 tax software download   All removals of gasoline at a terminal rack are taxable. 2011 tax software download The position holder for that gasoline is liable for the tax. 2011 tax software download Two-party exchanges. 2011 tax software download   In a two-party exchange, the receiving person, not the delivering person, is liable for the tax imposed on the removal of taxable fuel from the terminal at the terminal rack. 2011 tax software download A two-party exchange means a transaction (other than a sale) where the delivering person and receiving person are both taxable fuel registrants and all of the following apply. 2011 tax software download The transaction includes a transfer from the delivering person, who holds the inventory position for the taxable fuel in the terminal as reflected in the records of the terminal operator. 2011 tax software download The exchange transaction occurs before or at the same time as removal across the rack by the receiving person. 2011 tax software download The terminal operator in its records treats the receiving person as the person that removes the product across the terminal rack for purposes of reporting the transaction on Form 720-TO. 2011 tax software download The transaction is subject to a written contract. 2011 tax software download Terminal operator's liability. 2011 tax software download   The terminal operator is jointly and severally liable for the tax if the position holder is a person other than the terminal operator and is not a registrant. 2011 tax software download   However, a terminal operator meeting all the following conditions at the time of the removal will not be liable for the tax. 2011 tax software download The terminal operator is a registrant. 2011 tax software download The terminal operator has an unexpired notification certificate (discussed later) from the position holder. 2011 tax software download The terminal operator has no reason to believe any information on the certificate is false. 2011 tax software download Removal from refinery. 2011 tax software download   The removal of gasoline from a refinery is taxable if the removal meets either of the following conditions. 2011 tax software download It is made by bulk transfer and the refiner, the owner of the gasoline immediately before the removal, or the operator of the pipeline or vessel is not a registrant. 2011 tax software download It is made at the refinery rack. 2011 tax software download The refiner is liable for the tax. 2011 tax software download Exception. 2011 tax software download   The tax does not apply to a removal of gasoline at the refinery rack if all the following requirements are met. 2011 tax software download The gasoline is removed from an approved refinery not served by pipeline (other than for receiving crude oil) or vessel. 2011 tax software download The gasoline is received at a facility operated by a registrant and located within the bulk transfer/terminal system. 2011 tax software download The removal from the refinery is by railcar. 2011 tax software download The same person operates the refinery and the facility at which the gasoline is received. 2011 tax software download Entry into the United States. 2011 tax software download   The entry of gasoline into the United States is taxable if the entry meets either of the following conditions. 2011 tax software download It is made by bulk transfer and the enterer or the operator of the pipeline or vessel is not a registrant. 2011 tax software download It is not made by bulk transfer. 2011 tax software download The enterer is liable for the tax. 2011 tax software download Importer of record's liability. 2011 tax software download   The importer of record is jointly and severally liable for the tax with the enterer if the importer of record is not the enterer of the taxable fuel and the enterer is not a taxable fuel registrant. 2011 tax software download   However, an importer of record meeting both of the following conditions at the time of the entry will not be liable for the tax. 2011 tax software download The importer of record has an unexpired notification certificate (discussed later) from the enterer. 2011 tax software download The importer of record has no reason to believe any information in the certificate is false. 2011 tax software download Customs bond. 2011 tax software download   The customs bond will not be charged for the tax imposed on the entry of the gasoline if at the time of entry the surety has an unexpired notification certificate from the enterer and has no reason to believe any information in the certificate is false. 2011 tax software download Removal from a terminal by unregistered position holder or unregistered pipeline or vessel operator. 2011 tax software download   The removal by bulk transfer of gasoline from a terminal is taxable if the position holder for the gasoline or the operator of the pipeline or vessel is not a registrant. 2011 tax software download The position holder is liable for the tax. 2011 tax software download The terminal operator is jointly and severally liable for the tax if the position holder is a person other than the terminal operator. 2011 tax software download However, see Terminal operator's liability under Removal from terminal, earlier, for an exception. 2011 tax software download Bulk transfers not received at approved terminal or refinery. 2011 tax software download   The removal by bulk transfer of gasoline from a terminal or refinery, or the entry of gasoline by bulk transfer into the United States, is taxable if the following conditions apply. 2011 tax software download No tax was previously imposed (as discussed earlier) on any of the following events. 2011 tax software download The removal from the refinery. 2011 tax software download The entry into the United States. 2011 tax software download The removal from a terminal by an unregistered position holder. 2011 tax software download Upon removal from the pipeline or vessel, the gasoline is not received at an approved terminal or refinery (or at another pipeline or vessel). 2011 tax software download   The owner of the gasoline when it is removed from the pipeline or vessel is liable for the tax. 2011 tax software download However, an owner meeting all the following conditions at the time of the removal will not be liable for the tax. 2011 tax software download The owner is a registrant. 2011 tax software download The owner has an unexpired notification certificate (discussed later) from the operator of the terminal or refinery where the gasoline is received. 2011 tax software download The owner has no reason to believe any information on the certificate is false. 2011 tax software download The operator of the facility where the gasoline is received is liable for the tax if the owner meets these conditions. 2011 tax software download The operator is jointly and severally liable if the owner does not meet these conditions. 2011 tax software download Sales to unregistered person. 2011 tax software download   The sale of gasoline located within the bulk transfer/terminal system to a person that is not a registrant is taxable if tax was not previously imposed under any of the events discussed earlier. 2011 tax software download   The seller is liable for the tax. 2011 tax software download However, a seller meeting all the following conditions at the time of the sale will not be liable for the tax. 2011 tax software download   The seller is a registrant. 2011 tax software download The seller has an unexpired notification certificate (discussed later) from the buyer. 2011 tax software download The seller has no reason to believe any information on the certificate is false. 2011 tax software download The buyer of the gasoline is liable for the tax if the seller meets these conditions. 2011 tax software download The buyer is jointly and severally liable if the seller does not meet these conditions. 2011 tax software download Exception. 2011 tax software download   The tax does not apply to a sale if all of the following apply. 2011 tax software download The buyer's principal place of business is not in the United States. 2011 tax software download The sale occurs as the fuel is delivered into a transport vessel with a capacity of at least 20,000 barrels of fuel. 2011 tax software download The seller is a registrant and the exporter of record. 2011 tax software download The fuel was exported. 2011 tax software download Removal or sale of blended gasoline. 2011 tax software download   The removal or sale of blended gasoline by the blender is taxable. 2011 tax software download See Blended taxable fuel under Definitions, earlier. 2011 tax software download   The blender is liable for the tax. 2011 tax software download The tax is figured on the number of gallons not previously subject to the tax on gasoline. 2011 tax software download   Persons who blend alcohol with gasoline to produce an alcohol fuel mixture outside the bulk transfer/terminal system must pay the gasoline tax on the volume of alcohol in the mixture. 2011 tax software download See Form 720 to report this tax. 2011 tax software download You also must be registered with the IRS as a blender. 2011 tax software download See Form 637. 2011 tax software download   However, if an untaxed liquid is sold as taxed taxable fuel and that untaxed liquid is used to produce blended taxable fuel, the person that sold the untaxed liquid is jointly and severally liable for the tax imposed on the blender's sale or removal of the blended taxable fuel. 2011 tax software download Notification certificate. 2011 tax software download   The notification certificate is used to notify a person of the registration status of the registrant. 2011 tax software download A copy of the registrant's letter of registration cannot be used as a notification certificate. 2011 tax software download A model notification certificate is shown in the Appendix as Model Certificate C. 2011 tax software download A notification certificate must contain all information necessary to complete the model. 2011 tax software download   The certificate may be included as part of any business records normally used for a sale. 2011 tax software download A certificate expires on the earlier of the date the registrant provides a new certificate, or the date the recipient of the certificate is notified that the registrant's registration has been revoked or suspended. 2011 tax software download The registrant must provide a new certificate if any information on a certificate has changed. 2011 tax software download Additional persons liable. 2011 tax software download   When the person liable for the tax willfully fails to pay the tax, joint and several liability for the tax is imposed on: Any officer, employee, or agent of the person who is under a duty to ensure the payment of the tax and who willfully fails to perform that duty, or Anyone who willfully causes the person to fail to pay the tax. 2011 tax software download Gasoline Blendstocks Gasoline blendstocks may be subject to $. 2011 tax software download 001 per gallon LUST tax as discussed below. 2011 tax software download Gasoline includes gasoline blendstocks. 2011 tax software download The previous discussions apply to these blendstocks. 2011 tax software download However, if certain conditions are met, the removal, entry, or sale of gasoline blendstocks are taxed at $. 2011 tax software download 001 per gallon or are not subject to the excise tax. 2011 tax software download Blendstocks. 2011 tax software download   Gasoline blendstocks are: Alkylate, Butane, Butene, Catalytically cracked gasoline, Coker gasoline, Ethyl tertiary butyl ether (ETBE), Hexane, Hydrocrackate, Isomerate, Methyl tertiary butyl ether (MTBE), Mixed xylene (not including any separated isomer of xylene), Natural gasoline, Pentane, Pentane mixture, Polymer gasoline, Raffinate, Reformate, Straight-run gasoline, Straight-run naphtha, Tertiary amyl methyl ether (TAME), Tertiary butyl alcohol (gasoline grade) (TBA), Thermally cracked gasoline, and Toluene. 2011 tax software download   However, gasoline blendstocks do not include any product that cannot be used without further processing in the production of finished gasoline. 2011 tax software download Not used to produce finished gasoline. 2011 tax software download   Gasoline blendstocks not used to produce finished gasoline are not taxable (other than LUST) if the following conditions are met. 2011 tax software download Removals and entries not connected to sale. 2011 tax software download   Nonbulk removals and entries are not taxable if the person otherwise liable for the tax (position holder, refiner, or enterer) is a registrant. 2011 tax software download Removals and entries connected to sale. 2011 tax software download   Nonbulk removals and entries are not taxable if the person otherwise liable for the tax (position holder, refiner, or enterer) is a registrant, and at the time of the sale, meets the following requirements. 2011 tax software download The person has an unexpired certificate (discussed later) from the buyer. 2011 tax software download The person has no reason to believe any information in the certificate is false. 2011 tax software download Sales after removal or entry. 2011 tax software download   The sale of a gasoline blendstock that was not subject to tax on its nonbulk removal or entry, as discussed earlier, is taxable. 2011 tax software download The seller is liable for the tax. 2011 tax software download However, the sale is not taxable if, at the time of the sale, the seller meets the following requirements. 2011 tax software download The seller has an unexpired certificate (discussed next) from the buyer. 2011 tax software download The seller has no reason to believe any information in the certificate is false. 2011 tax software download Certificate of buyer. 2011 tax software download   The certificate from the buyer certifies the gasoline blendstocks will not be used to produce finished gasoline. 2011 tax software download The certificate may be included as part of any business records normally used for a sale. 2011 tax software download A model certificate is shown in the Appendix as Model Certificate D. 2011 tax software download The certificate must contain all information necessary to complete the model. 2011 tax software download   A certificate expires on the earliest of the following dates. 2011 tax software download The date 1 year after the effective date (not earlier than the date signed) of the certificate. 2011 tax software download The date a new certificate is provided to the seller. 2011 tax software download The date the seller is notified that the buyer's right to provide a certificate has been withdrawn. 2011 tax software download The buyer must provide a new certificate if any information on a certificate has changed. 2011 tax software download   The IRS may withdraw the buyer's right to provide a certificate if that buyer uses the gasoline blendstocks in the production of finished gasoline or resells the blendstocks without getting a certificate from its buyer. 2011 tax software download Received at approved terminal or refinery. 2011 tax software download   The nonbulk removal or entry of gasoline blendstocks received at an approved terminal or refinery is not taxable if the person otherwise liable for the tax (position holder, refiner, or enterer) meets all the following requirements. 2011 tax software download The person is a registrant. 2011 tax software download The person has an unexpired notification certificate (discussed earlier) from the operator of the terminal or refinery where the gasoline blendstocks are received. 2011 tax software download The person has no reason to believe any information on the certificate is false. 2011 tax software download Bulk transfers to registered industrial user. 2011 tax software download   The removal of gasoline blendstocks from a pipeline or vessel is not taxable (other than LUST) if the blendstocks are received by a registrant that is an industrial user. 2011 tax software download An industrial user is any person that receives gasoline blendstocks by bulk transfer for its own use in the manufacture of any product other than finished gasoline. 2011 tax software download Credits or Refunds. 2011 tax software download   A credit or refund of the gasoline tax may be allowable if gasoline is used for a nontaxable purpose or exempt use. 2011 tax software download For more information, see chapter 2. 2011 tax software download Diesel Fuel and Kerosene Generally, diesel fuel and kerosene are taxed in the same manner as gasoline (discussed earlier). 2011 tax software download However, special rules (discussed later) apply to dyed diesel fuel and dyed kerosene, and to undyed diesel fuel and undyed kerosene sold or used in Alaska for certain nontaxable uses and undyed kerosene used for a feedstock purpose. 2011 tax software download Diesel fuel means: Any liquid that without further processing or blending is suitable for use as a fuel in a diesel-powered highway vehicle or train, and Transmix. 2011 tax software download A liquid is suitable for this use if the liquid has practical and commercial fitness for use in the propulsion engine of a diesel-powered highway vehicle or diesel-powered train. 2011 tax software download A liquid may possess this practical and commercial fitness even though the specified use is not the predominant use of the liquid. 2011 tax software download However, a liquid does not possess this practical and commercial fitness solely by reason of its possible or rare use as a fuel in the propulsion engine of a diesel-powered highway vehicle or diesel-powered train. 2011 tax software download Diesel fuel does not include gasoline, kerosene, excluded liquid, No. 2011 tax software download 5 and No. 2011 tax software download 6 fuel oils covered by ASTM specification D396, or F-76 (Fuel Naval Distillate) covered by military specification MIL-F-16884. 2011 tax software download An excluded liquid is either of the following. 2011 tax software download A liquid that contains less than 4% normal paraffins. 2011 tax software download A liquid with all the following properties. 2011 tax software download Distillation range of 125 degrees Fahrenheit or less. 2011 tax software download Sulfur content of 10 ppm or less. 2011 tax software download Minimum color of +27 Saybolt. 2011 tax software download Transmix means a by-product of refined products created by the mixing of different specification products during pipeline transportation. 2011 tax software download Kerosene. 2011 tax software download   This means any of the following liquids. 2011 tax software download One of the two grades of kerosene (No. 2011 tax software download 1-K and No. 2011 tax software download 2-K) covered by ASTM specification D3699. 2011 tax software download Kerosene-type jet fuel covered by ASTM specification D1655 or military specification MIL-DTL-5624T (Grade JP-5) or MIL-DTL-83133E (Grade JP-8). 2011 tax software download See Kerosene for Use in Aviation, later. 2011 tax software download   However, kerosene does not include excluded liquid, discussed earlier. 2011 tax software download   Kerosene also includes any liquid that would be described above but for the presence of a dye of the type used to dye kerosene for a nontaxable use. 2011 tax software download Diesel-powered highway vehicle. 2011 tax software download   This is any self-propelled vehicle designed to carry a load over public highways (whether or not also designed to perform other functions) and propelled by a diesel-powered engine. 2011 tax software download Specially designed mobile machinery for nontransportation functions and vehicles specially designed for off-highway transportation are generally not considered diesel-powered highway vehicles. 2011 tax software download For more information about these vehicles and for information about vehicles not considered highway vehicles, see Off-Highway Business Use (No. 2011 tax software download 2) in chapter 2. 2011 tax software download Diesel-powered train. 2011 tax software download   This is any diesel-powered equipment or machinery that rides on rails. 2011 tax software download The term includes a locomotive, work train, switching engine, and track maintenance machine. 2011 tax software download Taxable Events The tax on diesel fuel and kerosene is $. 2011 tax software download 244 per gallon. 2011 tax software download It is imposed on the removal, entry, or sale of diesel fuel and kerosene. 2011 tax software download Each of these events is discussed later. 2011 tax software download Only the $. 2011 tax software download 001 LUST tax applies to dyed diesel fuel and dyed kerosene, discussed later. 2011 tax software download If the tax is paid on the diesel fuel or kerosene in more than one event, a refund may be allowed for the “second” tax paid. 2011 tax software download See Refunds of Second Tax in chapter 2. 2011 tax software download Use in certain intercity and local buses. 2011 tax software download   Dyed diesel fuel and dyed kerosene cannot be used in certain intercity and local buses. 2011 tax software download A claim for $. 2011 tax software download 17 per gallon may be made by the registered ultimate vendor (under certain conditions) or the ultimate purchaser for undyed diesel fuel or undyed kerosene sold for use in certain intercity or local buses. 2011 tax software download An intercity or local bus is a bus engaged in furnishing (for compensation) passenger land transportation available to the general public. 2011 tax software download The bus must be engaged in one of the following activities. 2011 tax software download Scheduled transportation along regular routes regardless of the size of the bus. 2011 tax software download Nonscheduled transportation if the seating capacity of the bus is at least 20 adults (not including the driver). 2011 tax software download A bus is available to the general public if the bus is available for hire to more than a limited number of persons, groups, or organizations. 2011 tax software download Removal from terminal. 2011 tax software download   All removals of diesel fuel and kerosene at a terminal rack are taxable. 2011 tax software download The position holder for that fuel is liable for the tax. 2011 tax software download Two-party exchanges. 2011 tax software download   In a two-party exchange, the receiving person, not the delivering person, is liable for the tax imposed on the removal of taxable fuel from the terminal at the terminal rack. 2011 tax software download A two-party exchange means a transaction (other than a sale) where the delivering person and receiving person are both taxable fuel registrants and all of the following apply. 2011 tax software download The transaction includes a transfer from the delivering person, who holds the inventory position for the taxable fuel in the terminal as reflected in the records of the terminal operator. 2011 tax software download The exchange transaction occurs before or at the same time as completion of removal across the rack by the receiving person. 2011 tax software download The terminal operator in its records treats the receiving person as the person that removes the product across the terminal rack for purposes of reporting the transaction on Form 720-TO. 2011 tax software download The transaction is subject to a written contract. 2011 tax software download Terminal operator's liability. 2011 tax software download   The terminal operator is jointly and severally liable for the tax if the terminal operator provides any person with any bill of lading, shipping paper, or similar document indicating that diesel fuel or kerosene is dyed (discussed later). 2011 tax software download   The terminal operator is jointly and severally liable for the tax if the position holder is a person other than the terminal operator and is not a registrant. 2011 tax software download However, a terminal operator will not be liable for the tax in this situation if, at the time of the removal, the following conditions are met. 2011 tax software download The terminal operator is a registrant. 2011 tax software download The terminal operator has an unexpired notification certificate (discussed under Gasoline) from the position holder. 2011 tax software download The terminal operator has no reason to believe any information on the certificate is false. 2011 tax software download Removal from refinery. 2011 tax software download   The removal of diesel fuel or kerosene from a refinery is taxable if the removal meets either of the following conditions. 2011 tax software download It is made by bulk transfer and the refiner, the owner of the fuel immediately before the removal, or the operator of the pipeline or vessel is not a registrant. 2011 tax software download It is made at the refinery rack. 2011 tax software download The refiner is liable for the tax. 2011 tax software download Exception. 2011 tax software download   The tax does not apply to a removal of diesel fuel or kerosene at the refinery rack if all the following conditions are met. 2011 tax software download The diesel fuel or kerosene is removed from an approved refinery not served by pipeline (other than for receiving crude oil) or vessel. 2011 tax software download The diesel fuel or kerosene is received at a facility operated by a registrant and located within the bulk transfer/terminal system. 2011 tax software download The removal from the refinery is by: Railcar and the same person operates the refinery and the facility at which the diesel fuel or kerosene is received, or For diesel fuel only, a trailer or semi-trailer used exclusively to transport the diesel fuel from a refinery (described in (1)) to a facility (described in (2)) less than 20 miles from the refinery. 2011 tax software download Entry into the United States. 2011 tax software download   The entry of diesel fuel or kerosene into the United States is taxable if the entry meets either of the following conditions. 2011 tax software download It is made by bulk transfer and the enterer or the operator of the pipeline or vessel is not a registrant. 2011 tax software download It is not made by bulk transfer. 2011 tax software download The enterer is liable for the tax. 2011 tax software download Importer of record's liability. 2011 tax software download   The importer of record is jointly and severally liable for the tax with the enterer if the importer of record is not the enterer of the taxable fuel and the enterer is not a taxable fuel registrant. 2011 tax software download   However, an importer of record meeting both of the following conditions at the time of the entry will not be liable for the tax. 2011 tax software download The importer of record has an unexpired notification certificate (discussed under Gasoline) from the enterer. 2011 tax software download The importer of record has no reason to believe any information in the certificate is false. 2011 tax software download Customs bond. 2011 tax software download   The customs bond will not be charged for the tax imposed on the entry of the diesel fuel or kerosene if at the time of entry the surety has an unexpired notification certificate from the enterer and has no reason to believe any information in the certificate is false. 2011 tax software download Removal from a terminal by unregistered position holder or unregistered pipeline or vessel operator. 2011 tax software download   The removal by bulk transfer of diesel fuel or kerosene from a terminal is taxable if the position holder for that fuel or the operator of the pipeline or vessel is not a registrant. 2011 tax software download The position holder is liable for the tax. 2011 tax software download The terminal operator is jointly and severally liable for the tax if the position holder is a person other than the terminal operator. 2011 tax software download However, see Terminal operator's liability under Removal from terminal, earlier, for an exception. 2011 tax software download Bulk transfers not received at approved terminal or refinery. 2011 tax software download   The removal by bulk transfer of diesel fuel or kerosene from a terminal or refinery or the entry of diesel fuel or kerosene by bulk transfer into the United States is taxable if the following conditions apply. 2011 tax software download No tax was previously imposed (as discussed earlier) on any of the following events. 2011 tax software download The removal from the refinery. 2011 tax software download The entry into the United States. 2011 tax software download The removal from a terminal by an unregistered position holder. 2011 tax software download Upon removal from the pipeline or vessel, the diesel fuel or kerosene is not received at an approved terminal or refinery (or at another pipeline or vessel). 2011 tax software download   The owner of the diesel fuel or kerosene when it is removed from the pipeline or vessel is liable for the tax. 2011 tax software download However, an owner meeting all the following conditions at the time of the removal will not be liable for the tax. 2011 tax software download The owner is a registrant. 2011 tax software download The owner has an unexpired notification certificate (discussed under Gasoline) from the operator of the terminal or refinery where the diesel fuel or kerosene is received. 2011 tax software download The owner has no reason to believe any information on the certificate is false. 2011 tax software download The operator of the facility where the diesel fuel or kerosene is received is liable for the tax if the owner meets these conditions. 2011 tax software download The operator is jointly and severally liable if the owner does not meet these conditions. 2011 tax software download Sales to unregistered person. 2011 tax software download   The sale of diesel fuel or kerosene located within the bulk transfer/terminal system to a person that is not a registrant is taxable if tax was not previously imposed under any of the events discussed earlier. 2011 tax software download   The seller is liable for the tax. 2011 tax software download However, a seller meeting all the following conditions at the time of the sale will not be liable for the tax. 2011 tax software download The seller is a registrant. 2011 tax software download The seller has an unexpired notification certificate (discussed under Gasoline) from the buyer. 2011 tax software download The seller has no reason to believe any information on the certificate is false. 2011 tax software download The buyer of the diesel fuel or kerosene is liable for the tax if the seller meets these conditions. 2011 tax software download The buyer is jointly and severally liable if the seller does not meet these conditions. 2011 tax software download Exception. 2011 tax software download   The tax does not apply to a sale if all of the following apply. 2011 tax software download The buyer's principal place of business is not in the United States. 2011 tax software download The sale occurs as the fuel is delivered into a transport vessel with a capacity of at least 20,000 barrels of fuel. 2011 tax software download The seller is a registrant and the exporter of record. 2011 tax software download The fuel was exported. 2011 tax software download Removal or sale of blended diesel fuel or kerosene. 2011 tax software download   The removal or sale of blended diesel fuel or blended kerosene by the blender is taxable. 2011 tax software download Blended taxable fuel produced using biodiesel is subject to the tax. 2011 tax software download See Blended taxable fuel under Definitions, earlier. 2011 tax software download   The blender is liable for the tax. 2011 tax software download The tax is figured on the number of gallons not previously subject to the tax. 2011 tax software download   Persons who blend biodiesel with undyed diesel fuel to produce and sell or use a biodiesel mixture outside the bulk transfer/terminal system must pay the diesel fuel tax on the volume of biodiesel in the mixture. 2011 tax software download Generally, the biodiesel mixture must be diesel fuel (defined earlier). 2011 tax software download See Form 720 to report this tax. 2011 tax software download You also must be registered by the IRS as a blender. 2011 tax software download See Form 637 for more information. 2011 tax software download   However, if an untaxed liquid is sold as taxable fuel and that untaxed liquid is used to produce blended taxable fuel, the person that sold the untaxed liquid is jointly and severally liable for the tax imposed on the blender's sale or removal of the blended taxable fuel. 2011 tax software download Additional persons liable. 2011 tax software download   When the person liable for the tax willfully fails to pay the tax, joint and several liability for the tax applies to: Any officer, employee, or agent of the person who is under a duty to ensure the payment of the tax and who willfully fails to perform that duty; or Anyone who willfully causes the person to fail to pay the tax. 2011 tax software download Credits or Refunds. 2011 tax software download   A credit or refund is allowable for the tax on undyed diesel fuel or undyed kerosene used for a nontaxable use. 2011 tax software download For more information, see chapter 2. 2011 tax software download Dyed Diesel Fuel and Dyed Kerosene Dyed diesel fuel and dyed kerosene are subject to $. 2011 tax software download 001 per gallon LUST tax as discussed below, unless the fuel is for export. 2011 tax software download The excise tax is not imposed on the removal, entry, or sale of diesel fuel or kerosene (other than the LUST tax) if all the following tests are met. 2011 tax software download The person otherwise liable for tax (for example, the position holder) is a registrant. 2011 tax software download In the case of a removal from a terminal, the terminal is an approved terminal. 2011 tax software download The diesel fuel or kerosene satisfies the dyeing requirements (described next). 2011 tax software download Dyeing requirements. 2011 tax software download   Diesel fuel or kerosene satisfies the dyeing requirements only if it satisfies the following requirements. 2011 tax software download It contains the dye Solvent Red 164 (and no other dye) at a concentration spectrally equivalent to at least 3. 2011 tax software download 9 pounds of the solid dye standard Solvent Red 26 per thousand barrels of fuel or any dye of a type and in a concentration that has been approved by the Commissioner. 2011 tax software download Is indelibly dyed by mechanical injection. 2011 tax software download See section 6 of Notice 2005-80 for transition rules that apply until final regulations are issued by the IRS. 2011 tax software download Notice required. 2011 tax software download   A legible and conspicuous notice stating either: DYED DIESEL FUEL, NONTAXABLE USE ONLY, PENALTY FOR TAXABLE USE or DYED KEROSENE, NONTAXABLE USE ONLY, PENALTY FOR TAXABLE USE must be: Provided by the terminal operator to any person that receives dyed diesel fuel or dyed kerosene at a terminal rack of that operator, and Posted by a seller on any retail pump or other delivery facility where it sells dyed diesel fuel or dyed kerosene for use by its buyer. 2011 tax software download   The notice under item (1) must be provided by the time of the removal and must appear on all shipping papers, bills of lading, and similar documents accompanying the removal of the fuel. 2011 tax software download   Any seller that fails to post the required notice under item (2) is presumed to know that the fuel will be used for a taxable use (a use other than a nontaxable use listed later). 2011 tax software download That seller is subject to the penalty described next. 2011 tax software download Penalty. 2011 tax software download   A penalty is imposed on a person if any of the following situations apply. 2011 tax software download Any dyed fuel is sold or held for sale by the person for a use the person knows or has reason to know is not a nontaxable use of the fuel. 2011 tax software download Any dyed fuel is held for use or used by the person for a use other than a nontaxable use and the person knew, or had reason to know, that the fuel was dyed. 2011 tax software download The person willfully alters, chemically or otherwise, or attempts to so alter, the strength or composition of any dye in dyed fuel. 2011 tax software download The person has knowledge that a dyed fuel that has been altered, as described in (3) above, sells or holds for sale such fuel for any use for which the person knows or has reason to know is not a nontaxable use of the fuel. 2011 tax software download   The penalty is the greater of $1,000 or $10 per gallon of the dyed diesel fuel or dyed kerosene involved. 2011 tax software download After the first violation, the $1,000 portion of the penalty increases depending on the number of violations. 2011 tax software download   This penalty is in addition to any tax imposed on the fuel. 2011 tax software download   If the penalty is imposed, each officer, employee, or agent of a business entity who willfully participated in any act giving rise to the penalty is jointly and severally liable with that entity for the penalty. 2011 tax software download   There is no administrative appeal or review allowed for the third and subsequent penalty imposed by section 6715 on any person except for: Fraud or a mistake in the chemical analysis, or Mathematical calculation of the penalty. 2011 tax software download   If you are liable for the penalty, you may also be liable for the back-up tax, discussed later. 2011 tax software download However, the penalty applies only to dyed diesel fuel and dyed kerosene, while the back-up tax may apply to other fuels. 2011 tax software download The penalty may apply if the fuel is held for sale or use for a taxable use while the back-up tax does not apply unless the fuel is delivered into a fuel supply tank. 2011 tax software download Exception to penalty. 2011 tax software download   The penalty under item (3) will not apply in any of the following situations. 2011 tax software download Diesel fuel or kerosene meeting the dyeing requirements (described earlier) is blended with any undyed liquid and the resulting product meets the dyeing requirements. 2011 tax software download Diesel fuel or kerosene meeting the dyeing requirements (described earlier) is blended with any other liquid (other than diesel fuel or kerosene) that contains the type and amount of dye required to meet the dyeing requirements. 2011 tax software download The alteration or attempted alteration occurs in an exempt area of Alaska. 2011 tax software download See Removal for sale or use in Alaska, later. 2011 tax software download Diesel fuel or kerosene meeting the dyeing requirements (described earlier) is blended with diesel fuel or kerosene not meeting the dyeing requirements and the blending occurs as part of a nontaxable use (other than export), discussed later. 2011 tax software download Alaska and Feedstocks Tax of $. 2011 tax software download 001 per gallon is imposed on: Undyed diesel fuel or undyed kerosene sold or used in Alaska for certain nontaxable uses (see Later sales on page 10). 2011 tax software download Undyed kerosene used for feedstock purposes. 2011 tax software download Removal for sale or use in Alaska. 2011 tax software download   No tax is imposed on the removal, entry, or sale of diesel fuel or kerosene in Alaska for ultimate sale or use in certain areas of Alaska for certain nontaxable uses. 2011 tax software download The removal or entry of any diesel fuel or kerosene is not taxed if all the following requirements are satisfied. 2011 tax software download The person otherwise liable for the tax (position holder, refiner, or enterer): Is a registrant, Can show satisfactory evidence of the nontaxable nature of the transaction, and Has no reason to believe the evidence is false. 2011 tax software download In the case of a removal from a terminal, the terminal is an approved terminal. 2011 tax software download The owner of the fuel immediately after the removal or entry holds the fuel for its own use in a nontaxable use (discussed later) or is a qualified dealer. 2011 tax software download   If all three of the requirements above are not met, then tax is imposed at $. 2011 tax software download 244 per gallon. 2011 tax software download   A qualified dealer is any person that holds a qualified dealer license from the state of Alaska or has been registered by the IRS as a qualified retailer. 2011 tax software download Satisfactory evidence may include copies of qualified dealer licenses or exemption certificates obtained for state tax purposes. 2011 tax software download Later sales. 2011 tax software download   The excise tax applies to diesel fuel or kerosene sold by a qualified dealer after the removal or entry. 2011 tax software download The tax is imposed at the time of the sale and the qualified dealer is liable for the tax. 2011 tax software download However, the sale is not taxable (other than the LUST tax at $. 2011 tax software download 001 per gallon) if all the following requirements are met. 2011 tax software download The fuel is sold in Alaska for certain nontaxable uses. 2011 tax software download The buyer buys the fuel for its own use in a nontaxable use or is a qualified dealer. 2011 tax software download The seller can show satisfactory evidence of the nontaxable nature of the transaction and has no reason to believe the evidence is false. 2011 tax software download Feedstock purposes. 2011 tax software download   The $. 2011 tax software download 001 per gallon LUST tax is imposed on the removal or entry of undyed kerosene if all the following conditions are met. 2011 tax software download The person otherwise liable for tax (position holder, refiner, or enterer) is a registrant. 2011 tax software download In the case of a removal from a terminal, the terminal is an approved terminal. 2011 tax software download Either: The person otherwise liable for tax uses the kerosene for a feedstock purpose, or The kerosene is sold for use by the buyer for a feedstock purpose and, at the time of the sale, the person otherwise liable for tax has an unexpired certificate (described later) from the buyer and has no reason to believe any information on the certificate is false. 2011 tax software download   If all of the requirements above are not met, then tax is imposed at $. 2011 tax software download 244 per gallon. 2011 tax software download   Kerosene is used for a feedstock purpose when it is used for nonfuel purposes in the manufacture or production of any substance other than gasoline, diesel fuel, or Other Fuels. 2011 tax software download For example, kerosene is used for a feedstock purpose when it is used as an ingredient in the production of paint, but is not used for a feedstock purpose when it is used to power machinery at a factory where paint is produced. 2011 tax software download A feedstock user is a person that uses kerosene for a feedstock purpose. 2011 tax software download A registered feedstock user is a person that has been registered by the IRS as a feedstock user. 2011 tax software download See Registration Requirements, earlier. 2011 tax software download Later sales. 2011 tax software download   The excise tax ($. 2011 tax software download 244 per gallon) applies to kerosene sold for use by the buyer for a feedstock purpose (item (3)(b) above) if the buyer in that sale later sells the kerosene. 2011 tax software download The tax is imposed at the time of the later sale and that seller is liable for the tax. 2011 tax software download Certificate. 2011 tax software download   The certificate from the buyer certifies the buyer is a registered feedstock user and the kerosene will be used by the buyer for a feedstock purpose. 2011 tax software download The certificate may be included as part of any business records normally used for a sale. 2011 tax software download A model certificate is shown in the Appendix as Model Certificate G. 2011 tax software download Your certificate must contain all information necessary to complete the model. 2011 tax software download   A certificate expires on the earliest of the following dates. 2011 tax software download The date 1 year after the effective date (not earlier than the date signed) of the certificate. 2011 tax software download The date the seller is provided a new certificate or notice that the current certificate is invalid. 2011 tax software download The date the seller is notified the buyer's registration has been revoked or suspended. 2011 tax software download   The buyer must provide a new certificate if any information on a certificate has changed. 2011 tax software download Back-up Tax Tax is imposed on the delivery of any of the following into the fuel supply tank of a diesel-powered highway vehicle. 2011 tax software download Any dyed diesel fuel or dyed kerosene for other than a nontaxable use. 2011 tax software download Any undyed diesel fuel or undyed kerosene on which a credit or refund (for fuel used for a nontaxable purpose) has been allowed. 2011 tax software download Any liquid other than gasoline, diesel fuel, or kerosene. 2011 tax software download Generally, this back-up tax is imposed at a rate of $. 2011 tax software download 244 per gallon. 2011 tax software download Liability for tax. 2011 tax software download   Generally, the operator of the vehicle into which the fuel is delivered is liable for the tax. 2011 tax software download In addition, the seller of the diesel fuel or kerosene is jointly and severally liable for the tax if the seller knows or has reason to know that the fuel will be used for other than a nontaxable use. 2011 tax software download Exemptions from the back-up tax. 2011 tax software download   The back-up tax does not apply to a delivery of diesel fuel or kerosene for uses 1, 2, 6, 7, 12, 13, 14, and 15 listed under Definitions of Nontaxable Uses in chapter 2. 2011 tax software download   In addition, since the back-up tax is imposed only on the delivery into the fuel supply tank of a diesel-powered vehicle or train, the tax does not apply to diesel fuel or kerosene used as heating oil or in stationary engines. 2011 tax software download Diesel-Water Fuel Emulsion Diesel-water fuel emulsion means diesel fuel at least 14% of which is water and for which the emulsion additive is registered by a United States manufacturer with the EPA under section 211 of the Clean Air Act as in effect on March 31, 2003. 2011 tax software download A reduced tax rate of $. 2011 tax software download 198 per gallon is imposed on a diesel-water fuel emulsion. 2011 tax software download To be eligible for the reduced rate, the person who sells, removes, or uses the diesel-water fuel emulsion must be registered by the IRS. 2011 tax software download If the diesel-water fuel emulsion does not meet the requirements above, or if the person who sells, removes, or uses the fuel is not registered, the diesel-water fuel emulsion is taxed at $. 2011 tax software download 244 per gallon. 2011 tax software download Credits or refunds. 2011 tax software download   The allowance for a credit or refund on a diesel-water fuel emulsion is discussed in chapter 2. 2011 tax software download Kerosene for Use in Aviation Taxable Events Generally, kerosene is taxed at $. 2011 tax software download 244 per gallon unless a reduced rate applies (see Diesel Fuel and Kerosene, earlier). 2011 tax software download For kerosene removed directly from a terminal into the fuel tank of an aircraft for use in noncommercial aviation, the tax rate is $. 2011 tax software download 219. 2011 tax software download The rate of $. 2011 tax software download 219 also applies if kerosene is removed into any aircraft from a qualified refueler truck, tanker, or tank wagon that is loaded with the kerosene from a terminal that is located within an airport. 2011 tax software download The airport terminal does not need to be a secured airport terminal for this rate to apply. 2011 tax software download However, the refueler truck, tanker, or tank wagon must meet the requirements discussed under Certain refueler trucks, tankers, and tank wagons, treated as terminals, later. 2011 tax software download For kerosene removed directly into the fuel tank of an aircraft for use in commercial aviation, the rate of tax is $. 2011 tax software download 044 per gallon. 2011 tax software download For kerosene removed into an aircraft from a qualified refueler truck, tanker, or tank wagon, the $. 2011 tax software download 044 rate applies only if the truck, tanker, or tank wagon is loaded at a terminal that is located in a secured area of the airport. 2011 tax software download See Terminal located within a secured area of an airport, later. 2011 tax software download In addition, the operator must provide the position holder with a certificate similar to Model Certificate K in the Appendix. 2011 tax software download For kerosene removed directly into the fuel tank of an aircraft for a use exempt from tax under section 4041(c) (such as use in an aircraft for the exclusive use of a state or local government), the rate of tax is $. 2011 tax software download 001. 2011 tax software download There is no tax on kerosene removed directly into the fuel tank of an aircraft for use in foreign trade. 2011 tax software download The kerosene must be removed from a qualifying refueler truck, tanker, or tank wagon loaded at a terminal located within a secured area of an airport. 2011 tax software download See Terminal located within a secured area of an airport, later. 2011 tax software download In addition, the operator must provide the position holder with a certificate similar to Model Certificate K in the Appendix. 2011 tax software download The position holder is liable for the $. 2011 tax software download 001 per gallon tax. 2011 tax software download For kerosene removed directly from a terminal into the fuel tank of an fractional ownership program aircraft after March 31, 2012, a surtax of $. 2011 tax software download 141 per gallon applies. 2011 tax software download Certain refueler trucks, tankers, and tank wagons treated as terminals. 2011 tax software download   For purposes of the tax imposed on kerosene for use in aviation removed directly into the fuel tank of an aircraft for use in commercial aviation, certain refueler trucks, tankers, and tank wagons are treated as part of a terminal if the following conditions are met. 2011 tax software download Such terminal is located within an area of an airport. 2011 tax software download Any kerosene for use in aviation that is loaded in a refueler truck, tanker, or tank wagon at a terminal is for delivery into aircraft at the airport in which the terminal is located. 2011 tax software download Except in exigent circumstances, such as those identified in Notice 2005-80, no vehicle registered for highway use is loaded with kerosene for use in aviation at the terminal. 2011 tax software download The refueler truck, tanker, or tank wagon meets the following requirements: Has storage tanks, hose, and coupling equipment designed and used for fueling aircraft, Is not registered for highway use, and Is operated by the terminal operator or a person that makes a daily accounting to the terminal operator of each delivery of fuel from the refueler truck, tanker, or tank wagon. 2011 tax software download Information reporting will be required by terminal operators regarding this provision. 2011 tax software download Until the format of this information reporting is issued, taxpayers are required to retain records regarding the daily accounting, but are not required to report such information. 2011 tax software download Terminal located within a secured area of an airport. 2011 tax software download   See Notice 2005-4 and Notice 2005-80 for the list of terminals located within a secured area of an airport. 2011 tax software download This list refers to fueling operations at airport terminals as it applies to the federal excise tax on kerosene for use in aviation, and has nothing to do with the general security of airports either included or not included in the list. 2011 tax software download Liability For Tax If the kerosene is removed directly into the fuel tank of an aircraft for use in commercial aviation, the operator of the aircraft in commercial aviation is liable for the tax on the removal at the rate of $. 2011 tax software download 044 per gallon. 2011 tax software download However, the position holder is liable for the LUST tax for kerosene for use in aviation removed directly into the fuel tank of an aircraft for use exempt from tax under section 4041(c) (except foreign trade). 2011 tax software download For example, for kerosene removed directly into the aircraft for use in military aircraft, the position holder is liable for the tax. 2011 tax software download For the aircraft operator to be liable for the tax $. 2011 tax software download 044 rate, the position holder must meet the following requirements: Is a taxable fuel registrant, Has an unexpired certificate (a model certificate is shown in the Appendix as Model Certificate K) from the operator of the aircraft, and Has no reason to believe any of the information in the certificate is false. 2011 tax software download Commercial aviation. 2011 tax software download   Commercial aviation is any use of an aircraft in the business of transporting persons or property by air for pay. 2011 tax software download However, commercial aviation does not include any of the following uses. 2011 tax software download Any use exclusively for the purpose of skydiving. 2011 tax software download Certain air transportation by seaplane. 2011 tax software download See Seaplanes under Transportation of Persons by Air in chapter 4. 2011 tax software download Any use of an aircraft owned or leased by a member of an affiliated group and unavailable for hire by nonmembers. 2011 tax software download For more information, see Aircraft used by affiliated corporations under Special Rules on Transportation Taxes in chapter 4. 2011 tax software download Any use of an aircraft that has a maximum certificated takeoff weight of 6,000 pounds or less, unless the aircraft is operated on an established line. 2011 tax software download For more information, see Small aircraft under Special Rules on Transportation Taxes in chapter 4. 2011 tax software download Any use where the surtax on fuel used in a fractional ownership program aircraft is imposed. 2011 tax software download See Surtax on any liquid used in a fractional ownership program aircraft as fuel below. 2011 tax software download Surtax on any liquid used in a fractional ownership program aircraft as fuel Fuel used in a fractional ownership program aircraft (as defined below) after March 31, 2012, is subject to a surtax of $. 2011 tax software download 141 per gallon. 2011 tax software download The fractional ownership program manager is liable for the tax. 2011 tax software download The surtax applies in addition to any other taxes imposed on the removal, entry, use, or sale of the fuel. 2011 tax software download If the surtax is imposed, the following air transportation taxes do not apply. 2011 tax software download Transportation of persons by air. 2011 tax software download Transportation of property by air. 2011 tax software download Use of international air travel facilities. 2011 tax software download These taxes are described under Air Transportation Taxes, later. 2011 tax software download A fractional ownership program aircraft flight is considered noncommercial aviation, for the rules for kerosene used in noncommercial aviation, see Kerosene for Use in Aviation above. 2011 tax software download Fractional ownership aircraft program    is a program under which:  A single fractional ownership program manager provides fractional ownership program management services on behalf of the fractional owners; There are one or more fractional owners per fractional program aircraft, with at least one fractional program aircraft having more than one owner; For at least two fractional program aircraft, none of the ownership interests in the aircraft are less than the minimum fractional ownership interest or held by the program manager; There exists a dry-lease aircraft exchange arrangement among all of the fractional owners; and There are multi-year program agreements covering the fractional ownership, fractional ownership program management services, and dry-lease aircraft exchange aspects of the program. 2011 tax software download Fractional program aircraft. 2011 tax software download   Any aircraft that, in any fractional ownership aircraft program, is listed as a fractional program aircraft in the management specifications issued to the manager of such program by Federal Aviation Administration under subpart K of part 91 title 14, Code of Federal Regulations, and is registered in the U. 2011 tax software download S. 2011 tax software download   Fractional program aircraft are not considered used for transportation of a qualified fractional owner, or on account of such qualified fractional owner when they are used for flight demonstration, maintenance or crew training. 2011 tax software download In such situations, the flight is not commercial aviation. 2011 tax software download Instead, the tax on the fuel used in the flight is imposed at the non-commercial aviation rate. 2011 tax software download Fractional owner. 2011 tax software download   Any person owning any interest (including the entire interest) in a fractional program aircraft. 2011 tax software download Dry lease aircraft exchange. 2011 tax software download   An agreement, documented by the written program agreements, under which the fractional program aircraft are available, on an as-needed basis without crew, to each fractional owner. 2011 tax software download Special rule relating to deadhead service. 2011 tax software download   A fractional program aircraft will not be considered to be used on account of a qualified fractional owner when it is used in deadhead service and a person other than a qualified fractional owner is separately charged for such service. 2011 tax software download More information. 2011 tax software download   See section 4043 for more information on the surtax. 2011 tax software download Certificate for Commercial Aviation and Exempt Uses A certificate is required from the aircraft operator: To support aircraft operator liability for tax on removal of kerosene for use in aviation directly into the fuel tank of an aircraft in commercial aviation, or For exempt uses. 2011 tax software download Certificate. 2011 tax software download   The certificate may be included as part of any business records normally used for a sale. 2011 tax software download See Model Certificate K in the Appendix. 2011 tax software download   A certificate expires on the earliest of the following dates. 2011 tax software download The date 1 year after the effective date (not earlier than the date signed) of the certificate. 2011 tax software download The date the buyer provides the seller a new certificate or notice that the current certificate is invalid. 2011 tax software download The date the IRS or the buyer notifies the seller that the buyer's right to provide a certificate has been withdrawn. 2011 tax software download   The buyer must provide a new certificate if any information on a certificate has changed. 2011 tax software download   The IRS may withdraw the buyer's right to provide a certificate if the buyer uses the kerosene for use in aviation to which a certificate relates other than as stated in the certificate. 2011 tax software download Exempt use. 2011 tax software download   The rate on kerosene for use in aviation is $. 2011 tax software download 001 (LUST tax) if it is removed from any refinery or terminal directly into the fuel tank of an aircraft for an exempt use. 2011 tax software download An exempt use includes kerosene for the exclusive use of a state or local government. 2011 tax software download There is no tax on kerosene removed directly into the fuel tank of an aircraft for use in foreign trade. 2011 tax software download Flash title transaction. 2011 tax software download   A position holder is not liable for tax if, among other conditions, it obtains a certificate (described above) from the operator of the aircraft into which the kerosene is delivered. 2011 tax software download In a “flash title transaction” the position holder sells the kerosene to a wholesale distributor (reseller) that in turn sells the kerosene to the aircraft operator as the kerosene is being removed from a terminal into the fuel tank of an aircraft. 2011 tax software download In this case, the position holder will be treated as having a certificate from the operator of the aircraft if: The aircraft operator puts the reseller's name, address, and EIN on the certificate in place of the position holder's information; and The reseller provides the position holder with a statement of the kerosene reseller. 2011 tax software download Reseller statement. 2011 tax software download   This is a statement that is signed under penalties of perjury by a person with authority to bind the reseller; is provided at the bottom or on the back of the certificate (or in an attached document); and contains: The reseller's name, address, and EIN; The position holder's name, address, and EIN; and A statement that the reseller has no reason to believe that any information in the accompanying aircraft operator's certificate is false. 2011 tax software download Credits or Refunds. 2011 tax software download   A claim may be made by the ultimate purchaser (the operator) for taxed kerosene for use in aviation used in commercial aviation (other than foreign trade) and noncommercial aviation (other than nonexempt, noncommercial aviation and exclusive use by a state, political subdivision of a state, or the District of Columbia). 2011 tax software download A claim may be made by a registered ultimate vendor for certain sales. 2011 tax software download For more information, see chapter 2. 2011 tax software download Other Fuels (Including Alternative Fuels) Other Fuels means any liquid except gas oil, fuel oil, or any product taxable under section 4081. 2011 tax software download Other Fuels include alternative fuels. 2011 tax software download Alternative fuels are: Liquefied petroleum gas (LPG), “P Series” fuels, Compressed natural gas (CNG) (discussed later), Liquefied hydrogen, Any liquid fuel derived from coal (including peat) through the Fischer-Tropsch process, Liquid fuel derived from biomass, Liquefied natural gas (LNG), and Liquefied gas derived from biomass. 2011 tax software download Liquefied petroleum gas includes propane, butane, pentane, or mixtures of those products. 2011 tax software download Qualified methanol and ethanol fuels. 2011 tax software download   Qualified ethanol and methanol means any liquid at least 85 percent of which consists of alcohol produced from coal, including peat. 2011 tax software download The tax rates are listed in the Instructions for Form 720. 2011 tax software download Partially exempt methanol and ethanol fuels. 2011 tax software download   A reduced tax rate applies to these fuels. 2011 tax software download Partially exempt ethanol and methanol means any liquid at least 85 percent of which consists of alcohol produced from natural gas. 2011 tax software download The tax rates are listed in the Instructions for Form 720. 2011 tax software download Motor vehicles. 2011 tax software download   Motor vehicles include all types of vehicles, whether or not registered (or required to be registered) for highway use, that have both the following characteristics. 2011 tax software download They are propelled by a motor. 2011 tax software download They are designed for carrying or towing loads from one place to another, regardless of the type of material or load carried or t