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2011 Taxes

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2011 Taxes

2011 taxes 2. 2011 taxes   Employees' Pay Table of Contents Introduction Topics - This chapter discusses: Useful Items - You may want to see: Tests for Deducting PayTest 1—Reasonableness Test 2—For Services Performed Kinds of PayAwards Bonuses Education Expenses Fringe Benefits Loans or Advances Property Reimbursements for Business Expenses Sick and Vacation Pay Introduction You can generally deduct the amount you pay your employees for the services they perform. 2011 taxes The pay may be in cash, property, or services. 2011 taxes It may include wages, salaries, bonuses, commissions, or other non-cash compensation such as vacation allowances and fringe benefits. 2011 taxes For information about deducting employment taxes, see chapter 5. 2011 taxes You can claim employment credits, such as the following, if you hire individuals who meet certain requirements. 2011 taxes Empowerment zone employment credit (Form 8844). 2011 taxes Indian employment credit (Form 8845). 2011 taxes Work opportunity credit (Form 5884). 2011 taxes Credit for employer differential wage payments (Form 8932). 2011 taxes Reduce your deduction for employee wages by the amount of employment credits you claim. 2011 taxes For more information about these credits, see the form on which the credit is claimed. 2011 taxes Topics - This chapter discusses: Tests for deducting pay Kinds of pay Useful Items - You may want to see: Publication 15 (Circular E), Employer's Tax Guide 15-A Employer's Supplemental Tax Guide 15-B Employer's Tax Guide to Fringe Benefits See chapter 12 for information about getting publications and forms. 2011 taxes Tests for Deducting Pay To be deductible, your employees' pay must be an ordinary and necessary business expense and you must pay or incur it. 2011 taxes These and other requirements that apply to all business expenses are explained in chapter 1. 2011 taxes In addition, the pay must meet both of the following tests. 2011 taxes Test 1. 2011 taxes It must be reasonable. 2011 taxes Test 2. 2011 taxes It must be for services performed. 2011 taxes The form or method of figuring the pay does not affect its deductibility. 2011 taxes For example, bonuses and commissions based on sales or earnings, and paid under an agreement made before the services were performed, are both deductible. 2011 taxes Test 1—Reasonableness You must be able to prove that the pay is reasonable. 2011 taxes Whether the pay is reasonable depends on the circumstances that existed when you contracted for the services, not those that exist when reasonableness is questioned. 2011 taxes If the pay is excessive, the excess pay is disallowed as a deduction. 2011 taxes Factors to consider. 2011 taxes   Determine the reasonableness of pay by the facts and circumstances. 2011 taxes Generally, reasonable pay is the amount that a similar business would pay for the same or similar services. 2011 taxes   To determine if pay is reasonable, also consider the following items and any other pertinent facts. 2011 taxes The duties performed by the employee. 2011 taxes The volume of business handled. 2011 taxes The character and amount of responsibility. 2011 taxes The complexities of your business. 2011 taxes The amount of time required. 2011 taxes The cost of living in the locality. 2011 taxes The ability and achievements of the individual employee performing the service. 2011 taxes The pay compared with the gross and net income of the business, as well as with distributions to shareholders if the business is a corporation. 2011 taxes Your policy regarding pay for all your employees. 2011 taxes The history of pay for each employee. 2011 taxes Test 2—For Services Performed You must be able to prove the payment was made for services actually performed. 2011 taxes Employee-shareholder salaries. 2011 taxes   If a corporation pays an employee who is also a shareholder a salary that is unreasonably high considering the services actually performed, the excessive part of the salary may be treated as a constructive dividend to the employee-shareholder. 2011 taxes The excessive part of the salary would not be allowed as a salary deduction by the corporation. 2011 taxes For more information on corporate distributions to shareholders, see Publication 542, Corporations. 2011 taxes Kinds of Pay Some of the ways you may provide pay to your employees in addition to regular wages or salaries are discussed next. 2011 taxes For specialized and detailed information on employees' pay and the employment tax treatment of employees' pay, see Publications 15, 15-A, and 15-B. 2011 taxes Awards You can generally deduct amounts you pay to your employees as awards, whether paid in cash or property. 2011 taxes If you give property to an employee as an employee achievement award, your deduction may be limited. 2011 taxes Achievement awards. 2011 taxes   An achievement award is an item of tangible personal property that meets all the following requirements. 2011 taxes It is given to an employee for length of service or safety achievement. 2011 taxes It is awarded as part of a meaningful presentation. 2011 taxes It is awarded under conditions and circumstances that do not create a significant likelihood of disguised pay. 2011 taxes Length-of-service award. 2011 taxes    An award will qualify as a length-of-service award only if either of the following applies. 2011 taxes The employee receives the award after his or her first 5 years of employment. 2011 taxes The employee did not receive another length-of-service award (other than one of very small value) during the same year or in any of the prior 4 years. 2011 taxes Safety achievement award. 2011 taxes    An award for safety achievement will qualify as an achievement award unless one of the following applies. 2011 taxes It is given to a manager, administrator, clerical employee, or other professional employee. 2011 taxes During the tax year, more than 10% of your employees, excluding those listed in (1), have already received a safety achievement award (other than one of very small value). 2011 taxes Deduction limit. 2011 taxes   Your deduction for the cost of employee achievement awards given to any one employee during the tax year is limited to the following. 2011 taxes $400 for awards that are not qualified plan awards. 2011 taxes $1,600 for all awards, whether or not qualified plan awards. 2011 taxes   A qualified plan award is an achievement award given as part of an established written plan or program that does not favor highly compensated employees as to eligibility or benefits. 2011 taxes   A highly compensated employee is an employee who meets either of the following tests. 2011 taxes The employee was a 5% owner at any time during the year or the preceding year. 2011 taxes The employee received more than $115,000 in pay for the preceding year. 2011 taxes You can choose to ignore test (2) if the employee was not also in the top 20% of employees ranked by pay for the preceding year. 2011 taxes   An award is not a qualified plan award if the average cost of all the employee achievement awards given during the tax year (that would be qualified plan awards except for this limit) is more than $400. 2011 taxes To figure this average cost, ignore awards of nominal value. 2011 taxes Deduct achievement awards as a nonwage business expense on your return or business schedule. 2011 taxes You may not owe employment taxes on the value of some achievement awards you provide to an employee. 2011 taxes See Publication 15-B. 2011 taxes Bonuses You can generally deduct a bonus paid to an employee if you intended the bonus as additional pay for services, not as a gift, and the services were performed. 2011 taxes However, the total bonuses, salaries, and other pay must be reasonable for the services performed. 2011 taxes If the bonus is paid in property, see Property , later. 2011 taxes Gifts of nominal value. 2011 taxes    If, to promote employee goodwill, you distribute food or merchandise of nominal value to your employees at holidays, you can deduct the cost of these items as a nonwage business expense. 2011 taxes Your deduction for de minimis gifts of food or drink are not subject to the 50% deduction limit that generally applies to meals. 2011 taxes For more information on this deduction limit, see Meals and lodging , later. 2011 taxes Education Expenses If you pay or reimburse education expenses for an employee, you can deduct the payments if they are part of a qualified educational assistance program. 2011 taxes Deduct them on the “Employee benefit programs” or other appropriate line of your tax return. 2011 taxes For information on educational assistance programs, see Educational Assistance in section 2 of Publication 15-B. 2011 taxes Fringe Benefits A fringe benefit is a form of pay for the performance of services. 2011 taxes You can generally deduct the cost of fringe benefits. 2011 taxes You may be able to exclude all or part of the value of some fringe benefits from your employees' pay. 2011 taxes You also may not owe employment taxes on the value of the fringe benefits. 2011 taxes See Table 2-1, Special Rules for Various Types of Fringe Benefits, in Publication 15-B for details. 2011 taxes Your deduction for the cost of fringe benefits for activities generally considered entertainment, amusement, or recreation, or for a facility used in connection with such an activity (for example, a company aircraft) for certain officers, directors, and more-than-10% shareholders is limited. 2011 taxes Certain fringe benefits are discussed next. 2011 taxes See Publication 15-B for more details on these and other fringe benefits. 2011 taxes Meals and lodging. 2011 taxes   You can usually deduct the cost of furnishing meals and lodging to your employees. 2011 taxes Deduct the cost in whatever category the expense falls. 2011 taxes For example, if you operate a restaurant, deduct the cost of the meals you furnish to employees as part of the cost of goods sold. 2011 taxes If you operate a nursing home, motel, or rental property, deduct the cost of furnishing lodging to an employee as expenses for utilities, linen service, salaries, depreciation, etc. 2011 taxes Deduction limit on meals. 2011 taxes   You can generally deduct only 50% of the cost of furnishing meals to your employees. 2011 taxes However, you can deduct the full cost of the following meals. 2011 taxes Meals whose value you include in an employee's wages. 2011 taxes Meals that qualify as a de minimis fringe benefit as discussed in section 2 of Publication 15-B. 2011 taxes This generally includes meals you furnish to employees at your place of business if more than half of these employees are provided the meals for your convenience. 2011 taxes Meals you furnish to your employees at the work site when you operate a restaurant or catering service. 2011 taxes Meals you furnish to your employees as part of the expense of providing recreational or social activities, such as a company picnic. 2011 taxes Meals you are required by federal law to furnish to crew members of certain commercial vessels (or would be required to furnish if the vessels were operated at sea). 2011 taxes This does not include meals you furnish on vessels primarily providing luxury water transportation. 2011 taxes Meals you furnish on an oil or gas platform or drilling rig located offshore or in Alaska. 2011 taxes This includes meals you furnish at a support camp that is near and integral to an oil or gas drilling rig located in Alaska. 2011 taxes Employee benefit programs. 2011 taxes   Employee benefit programs include the following. 2011 taxes Accident and health plans. 2011 taxes Adoption assistance. 2011 taxes Cafeteria plans. 2011 taxes Dependent care assistance. 2011 taxes Education assistance. 2011 taxes Life insurance coverage. 2011 taxes Welfare benefit funds. 2011 taxes   You can generally deduct amounts you spend on employee benefit programs on the applicable line of your tax return. 2011 taxes For example, if you provide dependent care by operating a dependent care facility for your employees, deduct your costs in whatever categories they fall (utilities, salaries, etc. 2011 taxes ). 2011 taxes Life insurance coverage. 2011 taxes   You cannot deduct the cost of life insurance coverage for you, an employee, or any person with a financial interest in your business, if you are directly or indirectly the beneficiary of the policy. 2011 taxes See Regulations section 1. 2011 taxes 264-1 for more information. 2011 taxes Welfare benefit funds. 2011 taxes   A welfare benefit fund is a funded plan (or a funded arrangement having the effect of a plan) that provides welfare benefits to your employees, independent contractors, or their beneficiaries. 2011 taxes Welfare benefits are any benefits other than deferred compensation or transfers of restricted property. 2011 taxes   Your deduction for contributions to a welfare benefit fund is limited to the fund's qualified cost for the tax year. 2011 taxes If your contributions to the fund are more than its qualified cost, carry the excess over to the next tax year. 2011 taxes   Generally, the fund's “qualified cost” is the total of the following amounts, reduced by the after-tax income of the fund. 2011 taxes The cost you would have been able to deduct using the cash method of accounting if you had paid for the benefits directly. 2011 taxes The contributions added to a reserve account that are needed to fund claims incurred but not paid as of the end of the year. 2011 taxes These claims can be for supplemental unemployment benefits, severance pay, or disability, medical, or life insurance benefits. 2011 taxes   For more information, see sections 419(c) and 419A of the Internal Revenue Code and the related regulations. 2011 taxes Loans or Advances You generally can deduct as wages an advance you make to an employee for services performed if you do not expect the employee to repay the advance. 2011 taxes However, if the employee performs no services, treat the amount you advanced as a loan. 2011 taxes If the employee does not repay the loan, treat it as income to the employee. 2011 taxes Below-market interest rate loans. 2011 taxes   On certain loans you make to an employee or shareholder, you are treated as having received interest income and as having paid compensation or dividends equal to that interest. 2011 taxes See Below-Market Loans in chapter 4. 2011 taxes Property If you transfer property (including your company's stock) to an employee as payment for services, you can generally deduct it as wages. 2011 taxes The amount you can deduct is the property's fair market value on the date of the transfer less any amount the employee paid for the property. 2011 taxes You can claim the deduction only for the tax year in which your employee includes the property's value in income. 2011 taxes Your employee is deemed to have included the value in income if you report it on Form W-2, Wage and Tax Statement, in a timely manner. 2011 taxes You treat the deductible amount as received in exchange for the property, and you must recognize any gain or loss realized on the transfer, unless it is the company's stock transferred as payment for services. 2011 taxes Your gain or loss is the difference between the fair market value of the property and its adjusted basis on the date of transfer. 2011 taxes These rules also apply to property transferred to an independent contractor for services, generally reported on Form 1099-MISC, Miscellaneous Income. 2011 taxes Restricted property. 2011 taxes   If the property you transfer for services is subject to restrictions that affect its value, you generally cannot deduct it and do not report gain or loss until it is substantially vested in the recipient. 2011 taxes However, if the recipient pays for the property, you must report any gain at the time of the transfer up to the amount paid. 2011 taxes    “Substantially vested” means the property is not subject to a substantial risk of forfeiture. 2011 taxes This means that the recipient is not likely to have to give up his or her rights in the property in the future. 2011 taxes Reimbursements for Business Expenses You can generally deduct the amount you pay or reimburse employees for business expenses incurred for your business. 2011 taxes However, your deduction may be limited. 2011 taxes If you make the payment under an accountable plan, deduct it in the category of the expense paid. 2011 taxes For example, if you pay an employee for travel expenses incurred on your behalf, deduct this payment as a travel expense. 2011 taxes If you make the payment under a nonaccountable plan, deduct it as wages and include it in the employee's Form W-2. 2011 taxes See Reimbursement of Travel, Meals, and Entertainment in chapter 11 for more information about deducting reimbursements and an explanation of accountable and nonaccountable plans. 2011 taxes Sick and Vacation Pay Sick pay. 2011 taxes   You can deduct amounts you pay to your employees for sickness and injury, including lump-sum amounts, as wages. 2011 taxes However, your deduction is limited to amounts not compensated by insurance or other means. 2011 taxes Vacation pay. 2011 taxes   Vacation pay is an employee benefit. 2011 taxes It includes amounts paid for unused vacation leave. 2011 taxes You can deduct vacation pay only in the tax year in which the employee actually receives it. 2011 taxes This rule applies regardless of whether you use the cash or accrual method of accounting. 2011 taxes Prev  Up  Next   Home   More Online Publications
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The 2011 Taxes

2011 taxes Internal Revenue Bulletin:  2013-12  March 18, 2013  Rev. 2011 taxes Proc. 2011 taxes 2013-21 Table of Contents SECTION 1. 2011 taxes PURPOSE SECTION 2. 2011 taxes BACKGROUND SECTION 3. 2011 taxes SCOPE SECTION 4. 2011 taxes APPLICATION. 2011 taxes 01 Limitations on Depreciation Deductions for Certain Automobiles. 2011 taxes . 2011 taxes 02 Inclusions in Income of Lessees of Passenger Automobiles. 2011 taxes SECTION 5. 2011 taxes EFFECTIVE DATE SECTION 6. 2011 taxes DRAFTING INFORMATION SECTION 1. 2011 taxes PURPOSE This revenue procedure provides: (1) limitations on depreciation deductions for owners of passenger automobiles first placed in service by the taxpayer during calendar year 2013, including separate tables of limitations on depreciation deductions for trucks and vans; and (2) the amounts that must be included in income by lessees of passenger automobiles first leased by the taxpayer during calendar year 2013, including a separate table of inclusion amounts for lessees of trucks and vans. 2011 taxes The tables detailing these depreciation limitations and lessee inclusion amounts reflect the automobile price inflation adjustments required by § 280F(d)(7) of the Internal Revenue Code. 2011 taxes SECTION 2. 2011 taxes BACKGROUND . 2011 taxes 01 For owners of passenger automobiles, § 280F(a) imposes dollar limitations on the depreciation deduction for the year the taxpayer places the passenger automobile in service and for each succeeding year. 2011 taxes For passenger automobiles placed in service after 1988, § 280F(d)(7) requires the Internal Revenue Service to increase the amounts allowable as depreciation deductions by a price inflation adjustment amount. 2011 taxes The method of calculating this price inflation amount for trucks and vans placed in service in or after calendar year 2003 uses a different CPI “automobile component” (the “new trucks” component) than that used in the price inflation amount calculation for other passenger automobiles (the “new cars” component), resulting in somewhat higher depreciation deductions for trucks and vans. 2011 taxes This change reflects the higher rate of price inflation for trucks and vans since 1988. 2011 taxes . 2011 taxes 02 Section 331(a) of the American Taxpayer Relief Act of 2012, Pub. 2011 taxes L. 2011 taxes No. 2011 taxes 112-240, 126 Stat. 2011 taxes 2313 (Jan. 2011 taxes 2, 2013) (the “Act”) extended the 50 percent additional first year depreciation deduction under § 168(k) to qualified property acquired by the taxpayer after December 31, 2007, and before January 1, 2014, if no written binding contract for the acquisition of the property existed before January 1, 2008, and if the taxpayer places the property in service generally before January 1, 2014. 2011 taxes Section 168(k)(2)(F)(i) increases the first year depreciation allowed under § 280F(a)(1)(A)(i) by $8,000 for passenger automobiles to which the additional first year depreciation deduction under § 168(k) (hereinafter, referred to as “§ 168(k) additional first year depreciation deduction”) applies. 2011 taxes . 2011 taxes 03 Section 168(k)(2)(D)(i) provides that the § 168(k) additional first year depreciation deduction does not apply to any property required to be depreciated under the alternative depreciation system of § 168(g), including property described in § 280F(b)(1). 2011 taxes Section 168(k)(2)(D)(iii) permits a taxpayer to elect out of the § 168(k) additional first year depreciation deduction for any class of property. 2011 taxes Section 168(k)(4), as amended by the Act, permits a corporation to elect to increase the alternative minimum tax (“AMT”) credit limitation under § 53(c), instead of claiming the § 168(k) additional first year depreciation deduction for all eligible qualified property placed in service after December 31, 2012, that is round 3 extension property (as defined in § 168(k)(4)(J)(iv)). 2011 taxes Accordingly, this revenue procedure provides tables for passenger automobiles for which the § 168(k) additional first year depreciation deduction applies. 2011 taxes This revenue procedure also provides tables for passenger automobiles for which the § 168(k) additional first year depreciation deduction does not apply, either because taxpayer: (1) purchased the passenger automobile used; (2) did not use the passenger automobile during 2013 more than 50 percent for business purposes; (3) elected out of the § 168(k) additional first year depreciation deduction pursuant to § 168(k)(2)(D)(iii); or (4) elected to increase the § 53 AMT credit limitation in lieu of claiming § 168(k) additional first year depreciation. 2011 taxes . 2011 taxes 04 Section 280F(c) requires a reduction in the deduction allowed to the lessee of a leased passenger automobile. 2011 taxes The reduction must be substantially equivalent to the limitations on the depreciation deductions imposed on owners of passenger automobiles. 2011 taxes Under § 1. 2011 taxes 280F-7(a) of the Income Tax Regulations, this reduction requires a lessee to include in gross income an amount determined by applying a formula to the amount obtained from a table. 2011 taxes One table applies to lessees of trucks and vans and another table applies to all other passenger automobiles. 2011 taxes Each table shows inclusion amounts for a range of fair market values for each taxable year after the passenger automobile is first leased. 2011 taxes SECTION 3. 2011 taxes SCOPE . 2011 taxes 01 The limitations on depreciation deductions in section 4. 2011 taxes 01(2) of this revenue procedure apply to passenger automobiles (other than leased passenger automobiles) that are placed in service by the taxpayer in calendar year 2013, and continue to apply for each taxable year that the passenger automobile remains in service. 2011 taxes . 2011 taxes 02 The tables in section 4. 2011 taxes 02 of this revenue procedure apply to leased passenger automobiles for which the lease term begins during calendar year 2013. 2011 taxes Lessees of these passenger automobiles must use these tables to determine the inclusion amount for each taxable year during which the passenger automobile is leased. 2011 taxes See Rev. 2011 taxes Proc. 2011 taxes 2008-22, 2008-1 C. 2011 taxes B. 2011 taxes 658, for passenger automobiles first leased during calendar year 2008; Rev. 2011 taxes Proc. 2011 taxes 2009-24, 2009-17 I. 2011 taxes R. 2011 taxes B. 2011 taxes 885, for passenger automobiles first leased during calendar year 2009; Rev. 2011 taxes Proc. 2011 taxes 2010-18, 2010-09 I. 2011 taxes R. 2011 taxes B. 2011 taxes 427, as amplified and modified by section 4. 2011 taxes 03 of Rev. 2011 taxes Proc. 2011 taxes 2011-21, 2011-12 I. 2011 taxes R. 2011 taxes B. 2011 taxes 560, for passenger automobiles first leased during calendar year 2010; Rev. 2011 taxes Proc. 2011 taxes 2011-21, for passenger automobiles first leased during calendar year 2011; and Rev. 2011 taxes Proc. 2011 taxes 2012-23, 2012-14 I. 2011 taxes R. 2011 taxes B. 2011 taxes 712, for passenger automobiles first leased during calendar year 2012. 2011 taxes SECTION 4. 2011 taxes APPLICATION . 2011 taxes 01 Limitations on Depreciation Deductions for Certain Automobiles. 2011 taxes (1) Amount of the inflation adjustment. 2011 taxes (a) Passenger automobiles (other than trucks or vans). 2011 taxes Under § 280F(d)(7)(B)(i), the automobile price inflation adjustment for any calendar year is the percentage (if any) by which the CPI automobile component for October of the preceding calendar year exceeds the CPI automobile component for October 1987. 2011 taxes Section 280F(d)(7)(B)(ii) defines the term “CPI automobile component” as the automobile component of the Consumer Price Index for all Urban Consumers published by the Department of Labor. 2011 taxes The new car component of the CPI was 115. 2011 taxes 2 for October 1987 and 143. 2011 taxes 787 for October 2012. 2011 taxes The October 2012 index exceeded the October 1987 index by 28. 2011 taxes 587. 2011 taxes Therefore, the automobile price inflation adjustment for 2013 for passenger automobiles (other than trucks and vans) is 24. 2011 taxes 8 percent (28. 2011 taxes 587/115. 2011 taxes 2 x 100%). 2011 taxes The dollar limitations in § 280F(a) are multiplied by a factor of 0. 2011 taxes 248, and the resulting increases, after rounding to the nearest $100, are added to the 1988 limitations to give the depreciation limitations applicable to passenger automobiles (other than trucks and vans) for calendar year 2013. 2011 taxes This adjustment applies to all passenger automobiles (other than trucks and vans) that are first placed in service in calendar year 2013. 2011 taxes (b) Trucks and vans. 2011 taxes To determine the dollar limitations for trucks and vans first placed in service during calendar year 2013, the Service uses the new truck component of the CPI instead of the new car component. 2011 taxes The new truck component of the CPI was 112. 2011 taxes 4 for October 1987 and 149. 2011 taxes 386 for October 2012. 2011 taxes The October 2012 index exceeded the October 1987 index by 36. 2011 taxes 986. 2011 taxes Therefore, the automobile price inflation adjustment for 2013 for trucks and vans is 32. 2011 taxes 9 percent (36. 2011 taxes 986/112. 2011 taxes 4 x 100%). 2011 taxes The dollar limitations in § 280F(a) are multiplied by a factor of 0. 2011 taxes 329, and the resulting increases, after rounding to the nearest $100, are added to the 1988 limitations to give the depreciation limitations for trucks and vans. 2011 taxes This adjustment applies to all trucks and vans that are first placed in service in calendar year 2013. 2011 taxes (2) Amount of the limitation. 2011 taxes Tables 1 through 4 contain the dollar amount of the depreciation limitation for each taxable year for passenger automobiles a taxpayer places in service in calendar year 2013. 2011 taxes Use Table 1 for a passenger automobile (other than a truck or van), and Table 2 for a truck or van, placed in service in calendar year 2013 for which the § 168(k) additional first year depreciation deduction applies. 2011 taxes Use Table 3 for a passenger automobile (other than a truck or van), and Table 4 for a truck or van, placed in service in calendar year 2013 for which the § 168(k) additional first year depreciation deduction does not apply. 2011 taxes REV. 2011 taxes PROC. 2011 taxes 2013-21 TABLE 1 DEPRECIATION LIMITATIONS FOR PASSENGER AUTOMOBILES (THAT ARE NOT TRUCKS OR VANS) PLACED IN SERVICE IN CALENDAR YEAR 2013 FOR WHICH THE § 168(k) ADDITIONAL FIRST YEAR DEPRECIATION DEDUCTION APPLIES Tax Year Amount 1st Tax Year $11,160 2nd Tax Year $5,100 3rd Tax Year $3,050 Each Succeeding Year $1,875 REV. 2011 taxes PROC. 2011 taxes 2013-21 TABLE 2 DEPRECIATION LIMITATIONS FOR TRUCKS AND VANS PLACED IN SERVICE IN CALENDAR YEAR 2013 FOR WHICH THE § 168(k) ADDITIONAL FIRST YEAR DEPRECIATION DEDUCTION APPLIES Tax Year Amount 1st Tax Year $11,360 2nd Tax Year $5,400 3rd Tax Year $3,250 Each Succeeding Year $1,975 REV. 2011 taxes PROC. 2011 taxes 2013-21 TABLE 3 DEPRECIATION LIMITATIONS FOR PASSENGER AUTOMOBILES (THAT ARE NOT TRUCKS OR VANS) PLACED IN SERVICE IN CALENDAR YEAR 2013 FOR WHICH THE § 168(k) ADDITIONAL FIRST YEAR DEPRECIATION DEDUCTION DOES NOT APPLY Tax Year Amount 1st Tax Year $3,160 2nd Tax Year $5,100 3rd Tax Year $3,050 Each Succeeding Year $1,875 REV. 2011 taxes PROC. 2011 taxes 2013-21 TABLE 4 DEPRECIATION LIMITATIONS FOR TRUCKS AND VANS PLACED IN SERVICE IN CALENDAR YEAR 2013 FOR WHICH THE § 168(k) ADDITIONAL FIRST YEAR DEPRECIATION DEDUCTION DOES NOT APPLY Tax Year Amount 1st Tax Year $3,360 2nd Tax Year $5,400 3rd Tax Year $3,250 Each Succeeding Year $1,975 . 2011 taxes 02 Inclusions in Income of Lessees of Passenger Automobiles. 2011 taxes A taxpayer must follow the procedures in § 1. 2011 taxes 280F-7(a) for determining the inclusion amounts for passenger automobiles first leased in calendar year 2013. 2011 taxes In applying these procedures, lessees of passenger automobiles other than trucks and vans should use Table 5 of this revenue procedure, while lessees of trucks and vans should use Table 6 of this revenue procedure. 2011 taxes REV. 2011 taxes PROC. 2011 taxes 2013-21 TABLE 5 DOLLAR AMOUNTS FOR PASSENGER AUTOMOBILES (THAT ARE NOT TRUCKS OR VANS) WITH A LEASE TERM BEGINNING IN CALENDAR YEAR 2013 Fair Market Value of Passenger Automobile Tax Year During Lease Over Not Over 1st 2nd 3rd 4th 5th & later $19,000 $19,500 2 4 6 7 8 19,500 20,000 2 5 6 9 9 20,000 20,500 2 5 8 9 11 20,500 21,000 3 6 8 10 12 21,000 21,500 3 6 10 11 13 21,500 22,000 3 7 10 13 14 22,000 23,000 4 8 11 14 16 23,000 24,000 4 9 14 16 18 24,000 25,000 5 10 15 18 21 25,000 26,000 5 12 16 21 23 26,000 27,000 6 12 19 23 25 27,000 28,000 6 14 20 25 28 28,000 29,000 7 15 22 27 30 29,000 30,000 7 16 24 29 33 30,000 31,000 8 17 26 31 35 31,000 32,000 8 19 27 33 38 32,000 33,000 9 20 29 35 40 33,000 34,000 10 21 31 37 43 34,000 35,000 10 22 33 39 45 35,000 36,000 11 23 35 41 48 36,000 37,000 11 25 36 43 50 37,000 38,000 12 26 38 45 53 38,000 39,000 12 27 40 47 55 39,000 40,000 13 28 42 49 58 40,000 41,000 13 29 44 52 59 41,000 42,000 14 30 45 54 63 42,000 43,000 14 32 47 56 64 43,000 44,000 15 33 48 59 67 44,000 45,000 15 34 51 60 69 45,000 46,000 16 35 52 63 72 46,000 47,000 17 36 54 65 74 47,000 48,000 17 38 55 67 77 48,000 49,000 18 39 57 69 79 49,000 50,000 18 40 59 71 82 50,000 51,000 19 41 61 73 84 51,000 52,000 19 42 63 75 87 52,000 53,000 20 43 65 77 89 53,000 54,000 20 45 66 79 92 54,000 55,000 21 46 68 81 94 55,000 56,000 21 47 70 84 96 56,000 57,000 22 48 72 85 99 57,000 58,000 22 50 73 88 101 58,000 59,000 23 51 75 90 103 59,000 60,000 24 52 76 92 106 60,000 62,000 24 54 79 95 110 62,000 64,000 25 56 83 99 115 64,000 66,000 27 58 87 103 120 66,000 68,000 28 60 90 108 125 68,000 70,000 29 63 93 112 130 70,000 72,000 30 65 97 117 134 72,000 74,000 31 68 100 121 139 74,000 76,000 32 70 104 125 144 76,000 78,000 33 73 107 129 149 78,000 80,000 34 75 111 133 154 80,000 85,000 36 79 117 141 162 85,000 90,000 39 85 126 151 174 90,000 95,000 41 91 135 162 186 95,000 100,000 44 97 144 172 199 100,000 110,000 48 106 157 188 217 110,000 120,000 53 118 174 210 241 120,000 130,000 59 129 193 230 266 130,000 140,000 64 141 210 252 290 140,000 150,000 70 153 227 273 315 150,000 160,000 75 165 245 294 339 160,000 170,000 80 177 263 315 363 170,000 180,000 86 189 280 336 388 180,000 190,000 91 201 298 357 412 190,000 200,000 97 212 316 378 436 200,000 210,000 102 224 333 400 461 210,000 220,000 107 236 351 420 486 220,000 230,000 113 248 368 442 509 230,000 240,000 118 260 386 463 534 240,000 And up 124 272 403 484 558 REV. 2011 taxes PROC. 2011 taxes 2013-21 TABLE 6 DOLLAR AMOUNTS FOR TRUCKS AND VANS WITH A LEASE TERM BEGINNING IN CALENDAR YEAR 2013 Fair Market Value of Truck or Van Tax Year During Lease Over Not Over 1st 2nd 3rd 4th 5th & later $19,000 $19,500 1 3 4 5 6 19,500 20,000 2 3 5 6 7 20,000 20,500 2 4 6 7 8 20,500 21,000 2 5 7 8 9 21,000 21,500 2 5 8 9 11 21,500 22,000 3 6 8 10 12 22,000 23,000 3 7 10 11 14 23,000 24,000 4 8 11 14 16 24,000 25,000 4 9 14 16 18 25,000 26,000 5 10 15 18 21 26,000 27,000 5 12 17 20 23 27,000 28,000 6 13 18 23 25 28,000 29,000 6 14 20 25 28 29,000 30,000 7 15 22 27 30 30,000 31,000 7 16 24 29 33 31,000 32,000 8 17 26 31 35 32,000 33,000 8 19 27 33 38 33,000 34,000 9 20 29 35 41 34,000 35,000 10 21 31 37 43 35,000 36,000 10 22 33 39 46 36,000 37,000 11 23 35 41 48 37,000 38,000 11 25 36 43 51 38,000 39,000 12 26 38 45 53 39,000 40,000 12 27 40 48 55 40,000 41,000 13 28 42 49 58 41,000 42,000 13 29 44 52 60 42,000 43,000 14 30 46 54 62 43,000 44,000 14 32 47 56 65 44,000 45,000 15 33 48 59 67 45,000 46,000 15 34 51 60 70 46,000 47,000 16 35 52 63 72 47,000 48,000 17 36 54 65 74 48,000 49,000 17 38 55 67 77 49,000 50,000 18 39 57 69 79 50,000 51,000 18 40 59 71 82 51,000 52,000 19 41 61 73 84 52,000 53,000 19 42 63 75 87 53,000 54,000 20 43 65 77 89 54,000 55,000 20 45 66 80 91 55,000 56,000 21 46 68 81 94 56,000 57,000 21 47 70 84 96 57,000 58,000 22 48 72 86 98 58,000 59,000 22 50 73 88 101 59,000 60,000 23 51 75 90 103 60,000 62,000 24 52 78 93 108 62,000 64,000 25 55 81 97 113 64,000 66,000 26 57 85 101 118 66,000 68,000 27 60 88 106 122 68,000 70,000 28 62 92 110 127 70,000 72,000 29 64 96 114 132 72,000 74,000 30 67 99 118 137 74,000 76,000 31 69 103 122 142 76,000 78,000 32 72 105 127 147 78,000 80,000 34 73 110 131 151 80,000 85,000 35 78 116 138 160 85,000 90,000 38 84 124 149 172 90,000 95,000 41 90 133 160 184 95,000 100,000 44 95 142 171 196 100,000 110,000 48 104 156 186 214 110,000 120,000 53 116 173 207 240 120,000 130,000 58 128 191 228 264 130,000 140,000 64 140 208 249 288 140,000 150,000 69 152 226 270 313 150,000 160,000 75 164 243 292 336 160,000 170,000 80 176 261 312 361 170,000 180,000 85 188 278 334 386 180,000 190,000 91 199 296 355 410 190,000 200,000 96 211 314 376 434 200,000 210,000 101 223 332 397 459 210,000 220,000 107 235 349 418 483 220,000 230,000 112 247 367 439 507 230,000 240,000 118 259 384 460 532 240,000 And up 123 271 401 482 556 SECTION 5. 2011 taxes EFFECTIVE DATE This revenue procedure applies to passenger automobiles that a taxpayer first places in service or first leases during calendar year 2013. 2011 taxes SECTION 6. 2011 taxes DRAFTING INFORMATION The principal author of this revenue procedure is Bernard P. 2011 taxes Harvey of the Office of Associate Chief Counsel (Income Tax & Accounting). 2011 taxes For further information regarding this revenue procedure, contact Mr. 2011 taxes Harvey at (202) 622-4930 (not a toll-free call). 2011 taxes Prev  Up  Next   Home   More Internal Revenue Bulletins