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2012 Irs Tax Return Forms

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2012 Irs Tax Return Forms

2012 irs tax return forms 32. 2012 irs tax return forms   Child and Dependent Care Credit Table of Contents Reminders Introduction Useful Items - You may want to see: Tests To Claim the CreditQualifying Person Test Earned Income Test Work-Related Expense Test Joint Return Test Provider Identification Test How To Figure the CreditFiguring Total Work-Related Expenses Earned Income Limit Dollar Limit Amount of Credit How To Claim the CreditTax credit not refundable. 2012 irs tax return forms Employment Taxes for Household Employers Reminders Taxpayer identification number needed for each qualifying person. 2012 irs tax return forms  You must include on line 2 of Form 2441 the name and taxpayer identification number (generally the social security number) of each qualifying person. 2012 irs tax return forms See Taxpayer identification number under Qualifying Person Test, later. 2012 irs tax return forms You may have to pay employment taxes. 2012 irs tax return forms  If you pay someone to come to your home and care for your dependent or spouse, you may be a household employer who has to pay employment taxes. 2012 irs tax return forms Usually, you are not a household employer if the person who cares for your dependent or spouse does so at his or her home or place of business. 2012 irs tax return forms See Employment Taxes for Household Employers , later. 2012 irs tax return forms Introduction This chapter discusses the credit for child and dependent care expenses and covers the following topics. 2012 irs tax return forms Tests you must meet to claim the credit. 2012 irs tax return forms How to figure the credit. 2012 irs tax return forms How to claim the credit. 2012 irs tax return forms Employment taxes you may have to pay as a household employer. 2012 irs tax return forms You may be able to claim the credit if you pay someone to care for your dependent who is under age 13 or for your spouse or dependent who is not able to care for himself or herself. 2012 irs tax return forms The credit can be up to 35% of your expenses. 2012 irs tax return forms To qualify, you must pay these expenses so you can work or look for work. 2012 irs tax return forms This credit should not be confused with the child tax credit discussed in chapter 34. 2012 irs tax return forms Dependent care benefits. 2012 irs tax return forms   If you received any dependent care benefits from your employer during the year, you may be able to exclude from your income all or part of them. 2012 irs tax return forms You must complete Form 2441, Part III, before you can figure the amount of your credit. 2012 irs tax return forms See Dependent Care Benefits under How To Figure the Credit, later. 2012 irs tax return forms Useful Items - You may want to see: Publication 501 Exemptions, Standard Deduction, and Filing Information 503 Child and Dependent Care Expenses 926 Household Employer's Tax Guide Form (and Instructions) 2441 Child and Dependent Care Expenses Schedule H (Form 1040) Household Employment Taxes W-7 Application for IRS Individual Taxpayer Identification Number W-10 Dependent Care Provider's Identification and Certification Tests To Claim the Credit To be able to claim the credit for child and dependent care expenses, you must file Form 1040 or Form 1040A, not Form 1040EZ, and meet all the following tests. 2012 irs tax return forms The care must be for one or more qualifying persons who are identified on Form 2441. 2012 irs tax return forms (See Qualifying Person Test . 2012 irs tax return forms ) You (and your spouse if filing jointly) must have earned income during the year. 2012 irs tax return forms (However, see Rule for student-spouse or spouse not able to care for self under Earned Income Test, later. 2012 irs tax return forms ) You must pay child and dependent care expenses so you (and your spouse if filing jointly) can work or look for work. 2012 irs tax return forms (See Work-Related Expense Test , later. 2012 irs tax return forms ) You must make payments for child and dependent care to someone you (and your spouse) cannot claim as a dependent. 2012 irs tax return forms If you make payments to your child, he or she cannot be your dependent and must be age 19 or older by the end of the year. 2012 irs tax return forms You cannot make payments to: Your spouse, or The parent of your qualifying person if your qualifying person is your child and under age 13. 2012 irs tax return forms (See Payments to Relatives or Dependents under Work-Related Expense Test, later. 2012 irs tax return forms ) Your filing status may be single, head of household, or qualifying widow(er) with dependent child. 2012 irs tax return forms If you are married, you must file a joint return, unless an exception applies to you. 2012 irs tax return forms (See Joint Return Test , later. 2012 irs tax return forms ) You must identify the care provider on your tax return. 2012 irs tax return forms (See Provider Identification Test , later. 2012 irs tax return forms ) If you exclude or deduct dependent care benefits provided by a dependent care benefits plan, the total amount you exclude or deduct must be less than the dollar limit for qualifying expenses (generally, $3,000 if one qualifying person was cared for or $6,000 if two or more qualifying persons were cared for). 2012 irs tax return forms (If two or more qualifying persons were cared for, the amount you exclude or deduct will always be less than the dollar limit, since the total amount you can exclude or deduct is limited to $5,000. 2012 irs tax return forms See Reduced Dollar Limit under How To Figure the Credit, later. 2012 irs tax return forms ) These tests are presented in Figure 32-A and are also explained in detail in this chapter. 2012 irs tax return forms Figure 32-A. 2012 irs tax return forms Can You Claim the Credit? Please click here for the text description of the image. 2012 irs tax return forms Figure 32-A Can You Claim the Credit? Qualifying Person Test Your child and dependent care expenses must be for the care of one or more qualifying persons. 2012 irs tax return forms A qualifying person is: Your qualifying child who is your dependent and who was under age 13 when the care was provided (but see Child of divorced or separated parents or parents living apart, later), Your spouse who was not physically or mentally able to care for himself or herself and lived with you for more than half the year, or A person who was not physically or mentally able to care for himself or herself, lived with you for more than half the year, and either: Was your dependent, or Would have been your dependent except that: He or she received gross income of $3,900 or more, He or she filed a joint return, or You, or your spouse if filing jointly, could be claimed as a dependent on someone else's 2013 return. 2012 irs tax return forms Dependent defined. 2012 irs tax return forms   A dependent is a person, other than you or your spouse, for whom you can claim an exemption. 2012 irs tax return forms To be your dependent, a person must be your qualifying child (or your qualifying relative). 2012 irs tax return forms Qualifying child. 2012 irs tax return forms   To be your qualifying child, a child must live with you for more than half the year and meet other requirements. 2012 irs tax return forms More information. 2012 irs tax return forms   For more information about who is a dependent or a qualifying child, see chapter 3. 2012 irs tax return forms Physically or mentally not able to care for oneself. 2012 irs tax return forms   Persons who cannot dress, clean, or feed themselves because of physical or mental problems are considered not able to care for themselves. 2012 irs tax return forms Also, persons who must have constant attention to prevent them from injuring themselves or others are considered not able to care for themselves. 2012 irs tax return forms Person qualifying for part of year. 2012 irs tax return forms   You determine a person's qualifying status each day. 2012 irs tax return forms For example, if the person for whom you pay child and dependent care expenses no longer qualifies on September 16, count only those expenses through September 15. 2012 irs tax return forms Also see Yearly limit under Dollar Limit, later. 2012 irs tax return forms Birth or death of otherwise qualifying person. 2012 irs tax return forms   In determining whether a person is a qualifying person, a person who was born or died in 2013 is treated as having lived with you for more than half of 2013 if your home was the person's home for more than half the time he or she was alive in 2013. 2012 irs tax return forms Taxpayer identification number. 2012 irs tax return forms   You must include on your return the name and taxpayer identification number (generally the social security number) of the qualifying person(s). 2012 irs tax return forms If the correct information is not shown, the credit may be reduced or disallowed. 2012 irs tax return forms Individual taxpayer identification number (ITIN) for aliens. 2012 irs tax return forms   If your qualifying person is a nonresident or resident alien who does not have and cannot get a social security number (SSN), use that person's ITIN. 2012 irs tax return forms The ITIN is entered wherever an SSN is requested on a tax return. 2012 irs tax return forms To apply for an ITIN, see Form W-7. 2012 irs tax return forms   An ITIN is for tax use only. 2012 irs tax return forms It does not entitle the holder to social security benefits or change the holder's employment or immigration status under U. 2012 irs tax return forms S. 2012 irs tax return forms law. 2012 irs tax return forms Adoption taxpayer identification number (ATIN). 2012 irs tax return forms   If your qualifying person is a child who was placed in your home for adoption and for whom you do not have an SSN, you must get an ATIN for the child. 2012 irs tax return forms File Form W-7A, Application for Taxpayer Identification Number for Pending U. 2012 irs tax return forms S. 2012 irs tax return forms Adoptions. 2012 irs tax return forms Child of divorced or separated parents or parents living apart. 2012 irs tax return forms   Even if you cannot claim your child as a dependent, he or she is treated as your qualifying person if: The child was under age 13 or was not physically or mentally able to care for himself or herself, The child received over half of his or her support during the calendar year from one or both parents who are divorced or legally separated under a decree of divorce or separate maintenance, are separated under a written separation agreement, or lived apart at all times during the last 6 months of the calendar year, The child was in the custody of one or both parents for more than half the year, and You were the child's custodial parent. 2012 irs tax return forms   The custodial parent is the parent with whom the child lived for the greater number of nights in 2013. 2012 irs tax return forms If the child was with each parent for an equal number of nights, the custodial parent is the parent with the higher adjusted gross income. 2012 irs tax return forms For details and an exception for a parent who works at night, see Pub. 2012 irs tax return forms 501. 2012 irs tax return forms   The noncustodial parent cannot treat the child as a qualifying person even if that parent is entitled to claim the child as a dependent under the special rules for a child of divorced or separated parents. 2012 irs tax return forms Earned Income Test To claim the credit, you (and your spouse if filing jointly) must have earned income during the year. 2012 irs tax return forms Earned income. 2012 irs tax return forms   Earned income includes wages, salaries, tips, other taxable employee compensation, and net earnings from self-employment. 2012 irs tax return forms A net loss from self-employment reduces earned income. 2012 irs tax return forms Earned income also includes strike benefits and any disability pay you report as wages. 2012 irs tax return forms   Generally, only taxable compensation is included. 2012 irs tax return forms However, you can elect to include nontaxable combat pay in earned income. 2012 irs tax return forms If you are filing a joint return and both you and your spouse received nontaxable combat pay, you can each make your own election. 2012 irs tax return forms (In other words, if one of you makes the election, the other one can also make it but does not have to. 2012 irs tax return forms ) You should figure your credit both ways and make the election if it gives you a greater tax benefit. 2012 irs tax return forms Members of certain religious faiths opposed to social security. 2012 irs tax return forms   Certain income earned by persons who are members of certain religious faiths that are opposed to participation in Social Security Act programs and have an IRS-approved form that exempts certain income from social security and Medicare taxes may not be considered earned income for this purpose. 2012 irs tax return forms See Earned Income Test in Publication 503. 2012 irs tax return forms Not earned income. 2012 irs tax return forms   Earned income does not include: Pensions and annuities, Social security and railroad retirement benefits, Workers' compensation, Interest and dividends, Unemployment compensation, Scholarship or fellowship grants, except for those reported on a Form W-2 and paid to you for teaching or other services, Nontaxable workfare payments, Child support payments received by you, Income of nonresident aliens that is not effectively connected with a U. 2012 irs tax return forms S. 2012 irs tax return forms trade or business, or Any amount received for work while an inmate in a penal institution. 2012 irs tax return forms Rule for student-spouse or spouse not able to care for self. 2012 irs tax return forms   Your spouse is treated as having earned income for any month that he or she is: A full-time student, or Physically or mentally not able to care for himself or herself. 2012 irs tax return forms (Your spouse also must live with you for more than half the year. 2012 irs tax return forms )   If you are filing a joint return, this rule also applies to you. 2012 irs tax return forms You can be treated as having earned income for any month you are a full-time student or not able to care for yourself. 2012 irs tax return forms   Figure the earned income of the nonworking spouse described under (1) or (2) above as explained under Earned Income Limit , later. 2012 irs tax return forms   This rule applies to only one spouse for any one month. 2012 irs tax return forms If, in the same month, both you and your spouse do not work and are either full-time students or not physically or mentally able to care for yourselves, only one of you can be treated as having earned income in that month. 2012 irs tax return forms Full-time student. 2012 irs tax return forms   You are a full-time student if you are enrolled at a school for the number of hours or classes that the school considers full time. 2012 irs tax return forms You must have been a full-time student for some part of each of 5 calendar months during the year. 2012 irs tax return forms (The months need not be consecutive. 2012 irs tax return forms ) School. 2012 irs tax return forms   The term “school” includes high schools, colleges, universities, and technical, trade, and mechanical schools. 2012 irs tax return forms A school does not include an on-the-job training course, correspondence school, or school offering courses only through the Internet. 2012 irs tax return forms Work-Related Expense Test Child and dependent care expenses must be work-related to qualify for the credit. 2012 irs tax return forms Expenses are considered work-related only if both of the following are true. 2012 irs tax return forms They allow you (and your spouse if filing jointly) to work or look for work. 2012 irs tax return forms They are for a qualifying person's care. 2012 irs tax return forms Working or Looking for Work To be work-related, your expenses must allow you to work or look for work. 2012 irs tax return forms If you are married, generally both you and your spouse must work or look for work. 2012 irs tax return forms One spouse is treated as working during any month he or she is a full-time student or is not physically or mentally able to care for himself or herself. 2012 irs tax return forms Your work can be for others or in your own business or partnership. 2012 irs tax return forms It can be either full time or part time. 2012 irs tax return forms Work also includes actively looking for work. 2012 irs tax return forms However, if you do not find a job and have no earned income for the year, you cannot take this credit. 2012 irs tax return forms See Earned Income Test , earlier. 2012 irs tax return forms An expense is not considered work-related merely because you had it while you were working. 2012 irs tax return forms The purpose of the expense must be to allow you to work. 2012 irs tax return forms Whether your expenses allow you to work or look for work depends on the facts. 2012 irs tax return forms Example 1. 2012 irs tax return forms The cost of a babysitter while you and your spouse go out to eat is not normally a work-related expense. 2012 irs tax return forms Example 2. 2012 irs tax return forms You work during the day. 2012 irs tax return forms Your spouse works at night and sleeps during the day. 2012 irs tax return forms You pay for care of your 5-year-old child during the hours when you are working and your spouse is sleeping. 2012 irs tax return forms Your expenses are considered work-related. 2012 irs tax return forms Volunteer work. 2012 irs tax return forms    For this purpose, you are not considered to be working if you do unpaid volunteer work or volunteer work for a nominal salary. 2012 irs tax return forms Work for part of year. 2012 irs tax return forms   If you work or actively look for work during only part of the period covered by the expenses, then you must figure your expenses for each day. 2012 irs tax return forms For example, if you work all year and pay care expenses of $250 a month ($3,000 for the year), all the expenses are work-related. 2012 irs tax return forms However, if you work or look for work for only 2 months and 15 days during the year and pay expenses of $250 a month, your work-related expenses are limited to $625 (2½ months × $250). 2012 irs tax return forms Temporary absence from work. 2012 irs tax return forms   You do not have to figure your expenses for each day during a short, temporary absence from work, such as for vacation or a minor illness, if you have to pay for care anyway. 2012 irs tax return forms Instead, you can figure your credit including the expenses you paid for the period of absence. 2012 irs tax return forms   An absence of 2 weeks or less is a short, temporary absence. 2012 irs tax return forms An absence of more than 2 weeks may be considered a short, temporary absence, depending on the circumstances. 2012 irs tax return forms Example. 2012 irs tax return forms You pay a nanny to care for your 2-year-old son and 4-year-old daughter so you can work. 2012 irs tax return forms You become ill and miss 4 months of work but receive sick pay. 2012 irs tax return forms You continue to pay the nanny to care for the children while you are ill. 2012 irs tax return forms Your absence is not a short, temporary absence, and your expenses are not considered work-related. 2012 irs tax return forms Part-time work. 2012 irs tax return forms   If you work part-time, you generally must figure your expenses for each day. 2012 irs tax return forms However, if you have to pay for care weekly, monthly, or in another way that includes both days worked and days not worked, you can figure your credit including the expenses you paid for days you did not work. 2012 irs tax return forms Any day when you work at least 1 hour is a day of work. 2012 irs tax return forms Example 1. 2012 irs tax return forms You work 3 days a week. 2012 irs tax return forms While you work, your 6-year-old child attends a dependent care center, which complies with all state and local regulations. 2012 irs tax return forms You can pay the center $150 for any 3 days a week or $250 for 5 days a week. 2012 irs tax return forms Your child attends the center 5 days a week. 2012 irs tax return forms Your work-related expenses are limited to $150 a week. 2012 irs tax return forms Example 2. 2012 irs tax return forms The facts are the same as in Example 1 except the center does not offer a 3-day option. 2012 irs tax return forms The entire $250 weekly fee may be a work-related expense. 2012 irs tax return forms Care of a Qualifying Person To be work-related, your expenses must be to provide care for a qualifying person. 2012 irs tax return forms You do not have to choose the least expensive way of providing care. 2012 irs tax return forms The cost of a paid care provider may be an expense for the care of a qualifying person even if another care provider is available at no cost. 2012 irs tax return forms Expenses are for the care of a qualifying person only if their main purpose is the person's well-being and protection. 2012 irs tax return forms Expenses for household services qualify if part of the services is for the care of qualifying persons. 2012 irs tax return forms See Household services , later. 2012 irs tax return forms Expenses not for care. 2012 irs tax return forms   Expenses for care do not include amounts you pay for food, lodging, clothing, education, and entertainment. 2012 irs tax return forms However, you can include small amounts paid for these items if they are incidental to and cannot be separated from the cost of caring for the qualifying person. 2012 irs tax return forms   Child support payments are not for care and do not qualify for the credit. 2012 irs tax return forms Education. 2012 irs tax return forms   Expenses for a child in nursery school, preschool, or similar programs for children below the level of kindergarten are expenses for care. 2012 irs tax return forms Expenses to attend kindergarten or a higher grade are not expenses for care. 2012 irs tax return forms Do not use these expenses to figure your credit. 2012 irs tax return forms   However, expenses for before- or after-school care of a child in kindergarten or a higher grade may be expenses for care. 2012 irs tax return forms   Summer school and tutoring programs are not for care. 2012 irs tax return forms Example 1. 2012 irs tax return forms You take your 3-year-old child to a nursery school that provides lunch and educational activities as a part of its preschool childcare service. 2012 irs tax return forms The lunch and educational activities are incidental to the childcare, and their cost cannot be separated from the cost of care. 2012 irs tax return forms You can count the total cost when you figure the credit. 2012 irs tax return forms Example 2. 2012 irs tax return forms You place your 10-year-old child in a boarding school so you can work full time. 2012 irs tax return forms Only the part of the boarding school expense that is for the care of your child is a work-related expense. 2012 irs tax return forms You can count that part of the expense in figuring your credit if it can be separated from the cost of education. 2012 irs tax return forms You cannot count any part of the amount you pay the school for your child's education. 2012 irs tax return forms Care outside your home. 2012 irs tax return forms   You can count the cost of care provided outside your home if the care is for your dependent under age 13 or any other qualifying person who regularly spends at least 8 hours each day in your home. 2012 irs tax return forms Dependent care center. 2012 irs tax return forms   You can count care provided outside your home by a dependent care center only if the center complies with all state and local regulations that apply to these centers. 2012 irs tax return forms   A dependent care center is a place that provides care for more than six persons (other than persons who live there) and receives a fee, payment, or grant for providing services for any of those persons, even if the center is not run for profit. 2012 irs tax return forms Camp. 2012 irs tax return forms   The cost of sending your child to an overnight camp is not considered a work-related expense. 2012 irs tax return forms The cost of sending your child to a day camp may be a work-related expense, even if the camp specializes in a particular activity, such as computers or soccer. 2012 irs tax return forms Transportation. 2012 irs tax return forms   If a care provider takes a qualifying person to or from a place where care is provided, that transportation is for the care of the qualifying person. 2012 irs tax return forms This includes transportation by bus, subway, taxi, or private car. 2012 irs tax return forms However, transportation not provided by a care provider is not for the care of a qualifying person. 2012 irs tax return forms Also, if you pay the transportation cost for the care provider to come to your home, that expense is not for care of a qualifying person. 2012 irs tax return forms Fees and deposits. 2012 irs tax return forms   Fees you paid to an agency to get the services of a care provider, deposits you paid to an agency or preschool, application fees, and other indirect expenses are work-related expenses if you have to pay them to get care, even though they are not directly for care. 2012 irs tax return forms However, a forfeited deposit is not for the care of a qualifying person if care is not provided. 2012 irs tax return forms Example 1. 2012 irs tax return forms You paid a fee to an agency to get the services of the nanny who cares for your 2-year-old daughter while you work. 2012 irs tax return forms The fee you paid is a work-related expense. 2012 irs tax return forms Example 2. 2012 irs tax return forms You placed a deposit with a preschool to reserve a place for your 3-year-old child. 2012 irs tax return forms You later sent your child to a different preschool and forfeited the deposit. 2012 irs tax return forms The forfeited deposit is not for care and so is not a work-related expense. 2012 irs tax return forms Household services. 2012 irs tax return forms   Expenses you pay for household services meet the work-related expense test if they are at least partly for the well-being and protection of a qualifying person. 2012 irs tax return forms   Household services are ordinary and usual services done in and around your home that are necessary to run your home. 2012 irs tax return forms They include the services of a housekeeper, maid, or cook. 2012 irs tax return forms However, they do not include the services of a chauffeur, bartender, or gardener. 2012 irs tax return forms See Household Services in Publication 503 for more information. 2012 irs tax return forms   In this chapter, the term housekeeper refers to any household employee whose services include the care of a qualifying person. 2012 irs tax return forms Taxes paid on wages. 2012 irs tax return forms   The taxes you pay on wages for qualifying child and dependent care services are work-related expenses. 2012 irs tax return forms See Employment Taxes for Household Employers , later. 2012 irs tax return forms Payments to Relatives or Dependents You can count work-related payments you make to relatives who are not your dependents, even if they live in your home. 2012 irs tax return forms However, do not count any amounts you pay to: A dependent for whom you (or your spouse if filing jointly) can claim an exemption, Your child who was under age 19 at the end of the year, even if he or she is not your dependent, A person who was your spouse any time during the year, or The parent of your qualifying person if your qualifying person is your child and under age 13. 2012 irs tax return forms Joint Return Test Generally, married couples must file a joint return to take the credit. 2012 irs tax return forms However, if you are legally separated or living apart from your spouse, you may be able to file a separate return and still take the credit. 2012 irs tax return forms Legally separated. 2012 irs tax return forms   You are not considered married if you are legally separated from your spouse under a decree of divorce or separate maintenance. 2012 irs tax return forms You may be eligible to take the credit on your return using head of household filing status. 2012 irs tax return forms Married and living apart. 2012 irs tax return forms   You are not considered married and are eligible to take the credit if all the following apply. 2012 irs tax return forms You file a return apart from your spouse. 2012 irs tax return forms Your home is the home of a qualifying person for more than half the year. 2012 irs tax return forms You pay more than half the cost of keeping up your home for the year. 2012 irs tax return forms Your spouse does not live in your home for the last 6 months of the year. 2012 irs tax return forms Costs of keeping up a home. 2012 irs tax return forms   The costs of keeping up a home normally include property taxes, mortgage interest, rent, utility charges, home repairs, insurance on the home, and food eaten at home. 2012 irs tax return forms   The costs of keeping up a home do not include payments for clothing, education, medical treatment, vacations, life insurance, transportation, or mortgage principal. 2012 irs tax return forms   They also do not include the purchase, permanent improvement, or replacement of property. 2012 irs tax return forms For example, you cannot include the cost of replacing a water heater. 2012 irs tax return forms However, you can include the cost of repairing a water heater. 2012 irs tax return forms Death of spouse. 2012 irs tax return forms   If your spouse died during the year and you do not remarry before the end of the year, you generally must file a joint return to take the credit. 2012 irs tax return forms If you do remarry before the end of the year, the credit can be claimed on your deceased spouse's return. 2012 irs tax return forms Provider Identification Test You must identify all persons or organizations that provide care for your child or dependent. 2012 irs tax return forms Use Form 2441, Part I, to show the information. 2012 irs tax return forms If you do not have any care providers and you are filing Form 2441 only to report taxable income in Part III, enter “none” in line 1, column (a). 2012 irs tax return forms Information needed. 2012 irs tax return forms   To identify the care provider, you must give the provider's: Name, Address, and Taxpayer identification number. 2012 irs tax return forms   If the care provider is an individual, the taxpayer identification number is his or her social security number or individual taxpayer identification number. 2012 irs tax return forms If the care provider is an organization, then it is the employer identification number (EIN). 2012 irs tax return forms   You do not have to show the taxpayer identification number if the care provider is a tax-exempt organization (such as a church or school). 2012 irs tax return forms In this case, enter “Tax-Exempt” in the space where Form 2441 asks for the number. 2012 irs tax return forms   If you cannot provide all of the information or if the information is incorrect, you must be able to show that you used due diligence (discussed later) in trying to furnish the necessary information. 2012 irs tax return forms Getting the information. 2012 irs tax return forms   You can use Form W-10 to request the required information from the care provider. 2012 irs tax return forms If you do not use Form W-10, you can get the information from one of the other sources listed in the instructions for Form W-10 including: A copy of the provider's social security card, A copy of the provider's completed Form W-4 if he or she is your household employee, A copy of the statement furnished by your employer if the provider is your employer's dependent care plan, or A letter or invoice from the provider if it shows the information. 2012 irs tax return forms    You should keep this information with your tax records. 2012 irs tax return forms Do not send Form W-10 (or other document containing this information) to the Internal Revenue Service. 2012 irs tax return forms Due diligence. 2012 irs tax return forms   If the care provider information you give is incorrect or incomplete, your credit may not be allowed. 2012 irs tax return forms However, if you can show that you used due diligence in trying to supply the information, you can still claim the credit. 2012 irs tax return forms   You can show due diligence by getting and keeping the provider's completed Form W-10 or one of the other sources of information just listed. 2012 irs tax return forms Care providers can be penalized if they do not provide this information to you or if they provide incorrect information. 2012 irs tax return forms Provider refusal. 2012 irs tax return forms   If the provider refuses to give you their identifying information, you should report on Form 2441 whatever information you have (such as the name and address). 2012 irs tax return forms Enter “See Attached Statement” in the columns calling for the information you do not have. 2012 irs tax return forms Then attach a statement explaining that you requested the information from the care provider, but the provider did not give you the information. 2012 irs tax return forms Be sure to write your name and social security number on this statement. 2012 irs tax return forms The statement will show that you used due diligence in trying to furnish the necessary information. 2012 irs tax return forms U. 2012 irs tax return forms S. 2012 irs tax return forms citizens and resident aliens living abroad. 2012 irs tax return forms   If you are living abroad, your care provider may not have, and may not be required to get, a U. 2012 irs tax return forms S. 2012 irs tax return forms taxpayer identification number (for example, an SSN or EIN). 2012 irs tax return forms If so, enter “LAFCP” (Living Abroad Foreign Care Provider) in the space for the care provider's taxpayer identification number. 2012 irs tax return forms How To Figure the Credit Your credit is a percentage of your work-related expenses. 2012 irs tax return forms Your expenses are subject to the earned income limit and the dollar limit. 2012 irs tax return forms The percentage is based on your adjusted gross income. 2012 irs tax return forms Figuring Total Work-Related Expenses To figure the credit for 2013 work-related expenses, count only those you paid by December 31, 2013. 2012 irs tax return forms Expenses prepaid in an earlier year. 2012 irs tax return forms   If you pay for services before they are provided, you can count the prepaid expenses only in the year the care is received. 2012 irs tax return forms Claim the expenses for the later year as if they were actually paid in that later year. 2012 irs tax return forms Expenses not paid until the following year. 2012 irs tax return forms   Do not count 2012 expenses that you paid in 2013 as work-related expenses for 2013. 2012 irs tax return forms You may be able to claim an additional credit for them on your 2013 return, but you must figure it separately. 2012 irs tax return forms See Payments for prior year's expenses under Amount of Credit in Publication 503. 2012 irs tax return forms    If you had expenses in 2013 that you did not pay until 2014, you cannot count them when figuring your 2013 credit. 2012 irs tax return forms You may be able to claim a credit for them on your 2014 return. 2012 irs tax return forms Expenses reimbursed. 2012 irs tax return forms   If a state social services agency pays you a nontaxable amount to reimburse you for some of your child and dependent care expenses, you cannot count the expenses that are reimbursed as work-related expenses. 2012 irs tax return forms Example. 2012 irs tax return forms You paid work-related expenses of $3,000. 2012 irs tax return forms You are reimbursed $2,000 by a state social services agency. 2012 irs tax return forms You can use only $1,000 to figure your credit. 2012 irs tax return forms Medical expenses. 2012 irs tax return forms   Some expenses for the care of qualifying persons who are not able to care for themselves may qualify as work-related expenses and also as medical expenses. 2012 irs tax return forms You can use them either way, but you cannot use the same expenses to claim both a credit and a medical expense deduction. 2012 irs tax return forms   If you use these expenses to figure the credit and they are more than the earned income limit or the dollar limit, discussed later, you can add the excess to your medical expenses. 2012 irs tax return forms However, if you use your total expenses to figure your medical expense deduction, you cannot use any part of them to figure your credit. 2012 irs tax return forms    Amounts excluded from your income under your employer's dependent care benefits plan cannot be used to claim a medical expense deduction. 2012 irs tax return forms Dependent Care Benefits If you receive dependent care benefits, your dollar limit for purposes of the credit may be reduced. 2012 irs tax return forms See Reduced Dollar Limit , later. 2012 irs tax return forms But, even if you cannot take the credit, you may be able to take an exclusion or deduction for the dependent care benefits. 2012 irs tax return forms Dependent care benefits. 2012 irs tax return forms   Dependent care benefits include: Amounts your employer paid directly to either you or your care provider for the care of your qualifying person while you work, The fair market value of care in a daycare facility provided or sponsored by your employer, and Pre-tax contributions you made under a dependent care flexible spending arrangement. 2012 irs tax return forms Your salary may have been reduced to pay for these benefits. 2012 irs tax return forms If you received benefits as an employee, they should be shown in box 10 of your Form W-2. 2012 irs tax return forms See Statement for employee , later. 2012 irs tax return forms Benefits you received as a partner should be shown in box 13 of your Schedule K-1 (Form 1065) with code O. 2012 irs tax return forms Enter the amount of these benefits on Form 2441, Part III, line 12. 2012 irs tax return forms Exclusion or deduction. 2012 irs tax return forms   If your employer provides dependent care benefits under a qualified plan, you may be able to exclude these benefits from your income. 2012 irs tax return forms Your employer can tell you whether your benefit plan qualifies. 2012 irs tax return forms To claim the exclusion, you must complete Part III of Form 2441. 2012 irs tax return forms You cannot use Form 1040EZ. 2012 irs tax return forms   If you are self-employed and receive benefits from a qualified dependent care benefit plan, you are treated as both employer and employee. 2012 irs tax return forms Therefore, you would not get an exclusion from wages. 2012 irs tax return forms Instead, you would get a deduction on Form 1040, Schedule C, line 14; Schedule E, line 19 or 28; or Schedule F, line 15. 2012 irs tax return forms To claim the deduction, you must use Form 2441. 2012 irs tax return forms   The amount you can exclude or deduct is limited to the smallest of: The total amount of dependent care benefits you received during the year, The total amount of qualified expenses you incurred during the year, Your earned income, Your spouse's earned income, or $5,000 ($2,500 if married filing separately). 2012 irs tax return forms The definition of earned income for the exclusion or deduction is the same as the definition used when figuring the credit except that earned income for the exclusion or deduction does not include any dependent care benefits you receive. 2012 irs tax return forms See Earned Income Limit, later. 2012 irs tax return forms    You can choose to include your nontaxable combat pay in earned income when figuring your exclusion or deduction, even if you choose not to include it in earned income for the earned income credit or the credit for child and dependent care expenses. 2012 irs tax return forms Statement for employee. 2012 irs tax return forms   Your employer must give you a Form W-2 (or similar statement) showing in box 10 the total amount of dependent care benefits provided to you during the year under a qualified plan. 2012 irs tax return forms Your employer will also include any dependent care benefits over $5,000 in your wages shown on your Form W-2 in box 1. 2012 irs tax return forms Effect of exclusion on credit. 2012 irs tax return forms   If you exclude dependent care benefits from your income, the amount of the excluded benefits: Is not included in your work-related expenses, and Reduces the dollar limit, discussed later. 2012 irs tax return forms Earned Income Limit The amount of work-related expenses you use to figure your credit cannot be more than: Your earned income for the year if you are single at the end of the year, or The smaller of your or your spouse's earned income for the year if you are married at the end of the year. 2012 irs tax return forms Earned income is defined under Earned Income Test , earlier. 2012 irs tax return forms For purposes of item (2), use your spouse's earned income for the entire year, even if you were married for only part of the year. 2012 irs tax return forms Separated spouse. 2012 irs tax return forms   If you are legally separated or married and living apart from your spouse (as described under Joint Return Test , earlier), you are not considered married for purposes of the earned income limit. 2012 irs tax return forms Use only your income in figuring the earned income limit. 2012 irs tax return forms Surviving spouse. 2012 irs tax return forms   If your spouse died during the year and you file a joint return as a surviving spouse, you may, but are not required to, take into account the earned income of your spouse who died during the year. 2012 irs tax return forms Community property laws. 2012 irs tax return forms   You should disregard community property laws when you figure earned income for this credit. 2012 irs tax return forms You or your spouse is a student or not able to care for self. 2012 irs tax return forms   Your spouse who is either a full-time student or not able to care for himself or herself is treated as having earned income. 2012 irs tax return forms His or her earned income for each month is considered to be at least $250 if there is one qualifying person in your home, or at least $500 if there are two or more. 2012 irs tax return forms Spouse works. 2012 irs tax return forms   If your spouse works during that month, use the higher of $250 (or $500) or his or her actual earned income for that month. 2012 irs tax return forms Spouse qualifies for part of month. 2012 irs tax return forms    If your spouse is a full-time student or not able to care for himself or herself for only part of a month, the full $250 (or $500) still applies for that month. 2012 irs tax return forms You are a student or not able to care for self. 2012 irs tax return forms   These rules also apply if you are a student or not able to care for yourself and you are filing a joint return. 2012 irs tax return forms For each month or part of a month you are a student or not able to care for yourself, your earned income is considered to be at least $250 (or $500). 2012 irs tax return forms If you also work during that month, use the higher of $250 (or $500) or your actual earned income for that month. 2012 irs tax return forms Both spouses qualify. 2012 irs tax return forms   If, in the same month, both you and your spouse are either full-time students or not able to care for yourselves, only one spouse can be considered to have this earned income of $250 (or $500) for that month. 2012 irs tax return forms Dollar Limit There is a dollar limit on the amount of your work-related expenses you can use to figure the credit. 2012 irs tax return forms This limit is $3,000 for one qualifying person, or $6,000 for two or more qualifying persons. 2012 irs tax return forms If you paid work-related expenses for the care of two or more qualifying persons, the applicable dollar limit is $6,000. 2012 irs tax return forms This $6,000 limit does not need to be divided equally among them. 2012 irs tax return forms For example, if your work-related expenses for the care of one qualifying person are $3,200 and your work-related expenses for another qualifying person are $2,800, you can use the total, $6,000, when figuring the credit. 2012 irs tax return forms Yearly limit. 2012 irs tax return forms   The dollar limit is a yearly limit. 2012 irs tax return forms The amount of the dollar limit remains the same no matter how long, during the year, you have a qualifying person in your household. 2012 irs tax return forms Use the $3,000 limit if you paid work-related expenses for the care of one qualifying person at any time during the year. 2012 irs tax return forms Use $6,000 if you paid work-related expenses for the care of more than one qualifying person at any time during the year. 2012 irs tax return forms Reduced Dollar Limit If you received dependent care benefits that you exclude or deduct from your income, you must subtract that amount from the dollar limit that applies to you. 2012 irs tax return forms Your reduced dollar limit is figured on Form 2441, Part III. 2012 irs tax return forms See Dependent Care Benefits , earlier, for information on excluding or deducting these benefits. 2012 irs tax return forms Example 1. 2012 irs tax return forms George is a widower with one child and earns $24,000 a year. 2012 irs tax return forms He pays work-related expenses of $2,900 for the care of his 4-year-old child and qualifies to claim the credit for child and dependent care expenses. 2012 irs tax return forms His employer pays an additional $1,000 under a dependent care benefit plan. 2012 irs tax return forms This $1,000 is excluded from George's income. 2012 irs tax return forms Although the dollar limit for his work-related expenses is $3,000 (one qualifying person), George figures his credit on only $2,000 of the $2,900 work-related expenses he paid. 2012 irs tax return forms This is because his dollar limit is reduced as shown next. 2012 irs tax return forms   George's Reduced Dollar Limit 1) Maximum allowable expenses for one qualifying person $3,000 2) Minus: Dependent care benefits George excludes from income −1,000 3) Reduced dollar limit on expenses George can use for the credit $2,000 Example 2. 2012 irs tax return forms Randall is married and both he and his wife are employed. 2012 irs tax return forms Each has earned income in excess of $6,000. 2012 irs tax return forms They have two children, Anne and Andy, ages 2 and 4, who attend a daycare facility licensed and regulated by the state. 2012 irs tax return forms Randall's work-related expenses are $6,000 for the year. 2012 irs tax return forms Randall's employer has a dependent care assistance program as part of its cafeteria plan, which allows employees to make pre-tax contributions to a dependent care flexible spending arrangement. 2012 irs tax return forms Randall has elected to take the maximum $5,000 exclusion from his salary to cover dependent care expenses through this program. 2012 irs tax return forms Although the dollar limit for his work- related expenses is $6,000 (two or more qualifying persons), Randall figures his credit on only $1,000 of the $6,000 work-related expense paid. 2012 irs tax return forms This is because his dollar limit is reduced as shown next. 2012 irs tax return forms   Randall's Reduced Dollar Limit 1) Maximum allowable expenses for two qualifying persons $6,000 2) Minus: Dependent care benefits Randall selects from employer's cafeteria plan and excludes from income −5,000 3) Reduced dollar limit on expenses Randall can use for the credit $1,000 Amount of Credit To determine the amount of your credit, multiply your work-related expenses (after applying the earned income and dollar limits) by a percentage. 2012 irs tax return forms This percentage depends on your adjusted gross income shown on Form 1040, line 38, or Form 1040A, line 22. 2012 irs tax return forms The following table shows the percentage to use based on adjusted gross income. 2012 irs tax return forms   IF your adjusted gross income is: THEN the percentage is:       Over   But not over         $0   $15,000   35%       15,000   17,000   34%       17,000   19,000   33%       19,000   21,000   32%       21,000   23,000   31%       23,000   25,000   30%       25,000   27,000   29%       27,000   29,000   28%       29,000   31,000   27%       31,000   33,000   26%       33,000   35,000   25%       35,000   37,000   24%       37,000   39,000   23%       39,000   41,000   22%       41,000   43,000   21%       43,000   No limit   20%   How To Claim the Credit To claim the credit, you can file Form 1040 or Form 1040A. 2012 irs tax return forms You cannot claim the credit on Form 1040EZ. 2012 irs tax return forms Form 1040 or 1040A. 2012 irs tax return forms   You must complete Form 2441 and attach it to your Form 1040 or 1040A. 2012 irs tax return forms Enter the credit on Form 1040, line 48, or Form 1040A, line 29. 2012 irs tax return forms Limit on credit. 2012 irs tax return forms   The amount of credit you can claim is generally limited to the amount of your tax. 2012 irs tax return forms For more information, see the Instructions for Form 2441. 2012 irs tax return forms Tax credit not refundable. 2012 irs tax return forms   You cannot get a refund for any part of the credit that is more than this limit. 2012 irs tax return forms Recordkeeping. 2012 irs tax return forms You should keep records of your work-related expenses. 2012 irs tax return forms Also, if your dependent or spouse is not able to care for himself or herself, your records should show both the nature and the length of the disability. 2012 irs tax return forms Other records you should keep to support your claim for the credit are described earlier under Provider Identification Test . 2012 irs tax return forms Employment Taxes for Household Employers If you pay someone to come to your home and care for your dependent or spouse, you may be a household employer. 2012 irs tax return forms If you are a household employer, you will need an employer identification number (EIN) and you may have to pay employment taxes. 2012 irs tax return forms If the individuals who work in your home are self-employed, you are not liable for any of the taxes discussed in this section. 2012 irs tax return forms Self-employed persons who are in business for themselves are not household employees. 2012 irs tax return forms Usually, you are not a household employer if the person who cares for your dependent or spouse does so at his or her home or place of business. 2012 irs tax return forms If you use a placement agency that exercises control over what work is done and how it will be done by a babysitter or companion who works in your home, the worker is not your employee. 2012 irs tax return forms This control could include providing rules of conduct and appearance and requiring regular reports. 2012 irs tax return forms In this case, you do not have to pay employment taxes. 2012 irs tax return forms But, if an agency merely gives you a list of sitters and you hire one from that list, and pay the sitter directly, the sitter may be your employee. 2012 irs tax return forms If you have a household employee, you may be subject to: Social security and Medicare taxes, Federal unemployment tax, and Federal income tax withholding. 2012 irs tax return forms Social security and Medicare taxes are generally withheld from the employee's pay and matched by the employer. 2012 irs tax return forms Federal unemployment (FUTA) tax is paid by the employer only and provides for payments of unemployment compensation to workers who have lost their jobs. 2012 irs tax return forms Federal income tax is withheld from the employee's total pay if the employee asks you to do so and you agree. 2012 irs tax return forms For more information on a household employer's tax responsibilities, see Publication 926 and Schedule H (Form 1040) and its instructions. 2012 irs tax return forms State employment tax. 2012 irs tax return forms   You may also have to pay state unemployment tax. 2012 irs tax return forms Contact your state unemployment tax office for information. 2012 irs tax return forms You should also find out whether you need to pay or collect other state employment taxes or carry workers' compensation insurance. 2012 irs tax return forms For a list of state unemployment tax agencies, visit the U. 2012 irs tax return forms S. 2012 irs tax return forms Department of Labor's website. 2012 irs tax return forms A link to that website is in Publication 926, or you can find it with an online search. 2012 irs tax return forms Prev  Up  Next   Home   More Online Publications
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Abusive Tax Schemes - Criminal Investigation (CI)

Overview - Abusive Tax Schemes
Since the mid-1990s, the IRS has witnessed a proliferation of abusive tax schemes, particularly those with offshore components. 

What are some of the Most Common Abusive Tax Schemes?
The most common abusive tax schemes involve numerous domestic and foreign trusts, partnerships, or nominees.

How Does the Taxpayer Access the Funds in Offshore Accounts? - Abusive Tax Schemes
There are two methods commonly used to get funds back to the taxpayers. They are through credit/debit cards and fraudulent loans. 

In Partnership - IRS Criminal and Civil Enforcement and Department of Justice - Abusive Tax Schemes
Parallel civil and criminal investigations are an effective and aggressive approach that halts these schemes quickly and permanently.

Civil and Criminal Penalties - Abusive Tax Schemes
Investors of abusive tax schemes that improperly evade tax are still liable for taxes, interest, and civil penalties.

Statistical Data - Abusive Tax Schemes
Enforcement statistics on investigations initiated, prosecutions recommended, indictments, sentenced, and months to serve in prison.

Examples of Abusive Tax Scheme
Examples have been written from public record documents filed in the district courts where the case was prosecuted.

 


Criminal Enforcement Home Page

How to Report Suspected Tax Fraud Activities

Page Last Reviewed or Updated: 30-Oct-2013

The 2012 Irs Tax Return Forms

2012 irs tax return forms Publication 529 - Main Content Table of Contents Deductions Subject to the 2% LimitUnreimbursed Employee Expenses Tax Preparation Fees Other Expenses Deductions Not Subject to the 2% LimitList of Deductions Nondeductible ExpensesList of Nondeductible Expenses How To ReportWho can use Form 2106-EZ. 2012 irs tax return forms Computer used in a home office. 2012 irs tax return forms Example How To Get Tax HelpLow Income Taxpayer Clinics Deductions Subject to the 2% Limit You can deduct certain expenses as miscellaneous itemized deductions on Schedule A (Form 1040 or Form 1040NR). 2012 irs tax return forms You can claim the amount of expenses that is more than 2% of your adjusted gross income. 2012 irs tax return forms You figure your deduction on Schedule A by subtracting 2% of your adjusted gross income from the total amount of these expenses. 2012 irs tax return forms Your adjusted gross income is the amount on Form 1040, line 38, or Form 1040NR, line 37. 2012 irs tax return forms Generally, you apply the 2% limit after you apply any other deduction limit. 2012 irs tax return forms For example, you apply the 50% (or 80%) limit on business-related meals and entertainment (discussed later under Travel, Transportation, Meals, Entertainment, Gifts, and Local Lodging ) before you apply the 2% limit. 2012 irs tax return forms Deductions subject to the 2% limit are discussed in the following three categories. 2012 irs tax return forms Unreimbursed employee expenses (Schedule A (Form 1040), line 21 or Schedule A (Form 1040NR), line 7). 2012 irs tax return forms Tax preparation fees (Schedule A (Form 1040), line 22 or Schedule A (Form 1040NR), line 8). 2012 irs tax return forms Other expenses (Schedule A (Form 1040), line 23 or Schedule A (Form 1040NR), line 9). 2012 irs tax return forms Unreimbursed Employee Expenses Generally, the following expenses are deducted on Schedule A (Form 1040), line 21, or Schedule A (Form 1040NR), line 7. 2012 irs tax return forms You can deduct only unreimbursed employee expenses that are: Paid or incurred during your tax year, For carrying on your trade or business of being an employee, and Ordinary and necessary. 2012 irs tax return forms An expense is ordinary if it is common and accepted in your trade, business, or profession. 2012 irs tax return forms An expense is necessary if it is appropriate and helpful to your business. 2012 irs tax return forms An expense does not have to be required to be considered necessary. 2012 irs tax return forms You may be able to deduct the following items as unreimbursed employee expenses. 2012 irs tax return forms Business bad debt of an employee. 2012 irs tax return forms Business liability insurance premiums. 2012 irs tax return forms Damages paid to a former employer for breach of an employment contract. 2012 irs tax return forms Depreciation on a computer your employer requires you to use in your work. 2012 irs tax return forms Dues to a chamber of commerce if membership helps you do your job. 2012 irs tax return forms Dues to professional societies. 2012 irs tax return forms Educator expenses. 2012 irs tax return forms Home office or part of your home used regularly and exclusively in your work. 2012 irs tax return forms Job search expenses in your present occupation. 2012 irs tax return forms Laboratory breakage fees. 2012 irs tax return forms Legal fees related to your job. 2012 irs tax return forms Licenses and regulatory fees. 2012 irs tax return forms Malpractice insurance premiums. 2012 irs tax return forms Medical examinations required by an employer. 2012 irs tax return forms Occupational taxes. 2012 irs tax return forms Passport for a business trip. 2012 irs tax return forms Repayment of an income aid payment received under an employer's plan. 2012 irs tax return forms Research expenses of a college professor. 2012 irs tax return forms Rural mail carriers' vehicle expenses. 2012 irs tax return forms Subscriptions to professional journals and trade magazines related to your work. 2012 irs tax return forms Tools and supplies used in your work. 2012 irs tax return forms Travel, transportation, meals, entertainment, gifts, and local lodging related to your work. 2012 irs tax return forms Union dues and expenses. 2012 irs tax return forms Work clothes and uniforms if required and not suitable for everyday use. 2012 irs tax return forms Work-related education. 2012 irs tax return forms Business Bad Debt A business bad debt is a loss from a debt created or acquired in your trade or business. 2012 irs tax return forms Any other worthless debt is a business bad debt only if there is a very close relationship between the debt and your trade or business when the debt becomes worthless. 2012 irs tax return forms A debt has a very close relationship to your trade or business of being an employee if your main motive for incurring the debt is a business reason. 2012 irs tax return forms Example. 2012 irs tax return forms You make a bona fide loan to the corporation you work for. 2012 irs tax return forms It fails to pay you back. 2012 irs tax return forms You had to make the loan in order to keep your job. 2012 irs tax return forms You have a business bad debt as an employee. 2012 irs tax return forms More information. 2012 irs tax return forms   For more information on business bad debts, see chapter 10 in Publication 535. 2012 irs tax return forms For information on nonbusiness bad debts, see chapter 4 in Publication 550, Investment Income and Expenses. 2012 irs tax return forms Business Liability Insurance You can deduct insurance premiums you paid for protection against personal liability for wrongful acts on the job. 2012 irs tax return forms Damages for Breach of Employment Contract If you break an employment contract, you can deduct damages you pay your former employer if the damages are attributable to the pay you received from that employer. 2012 irs tax return forms Depreciation on Computers You can claim a depreciation deduction for a computer that you use in your work as an employee if its use is: For the convenience of your employer, and Required as a condition of your employment. 2012 irs tax return forms For the convenience of your employer. 2012 irs tax return forms   This means that your use of the computer is for a substantial business reason of your employer. 2012 irs tax return forms You must consider all facts in making this determination. 2012 irs tax return forms Use of your computer during your regular working hours to carry on your employer's business is generally for the convenience of your employer. 2012 irs tax return forms Required as a condition of your employment. 2012 irs tax return forms   This means that you cannot properly perform your duties without the computer. 2012 irs tax return forms Whether you can properly perform your duties without it depends on all the facts and circumstances. 2012 irs tax return forms It is not necessary that your employer explicitly requires you to use your computer. 2012 irs tax return forms But neither is it enough that your employer merely states that your use of the item is a condition of your employment. 2012 irs tax return forms Example. 2012 irs tax return forms You are an engineer with an engineering firm. 2012 irs tax return forms You occasionally take work home at night rather than work late at the office. 2012 irs tax return forms You own and use a computer that is similar to the one you use at the office to complete your work at home. 2012 irs tax return forms Since your use of the computer is not for the convenience of your employer and is not required as a condition of your employment, you cannot claim a depreciation deduction for it. 2012 irs tax return forms Which depreciation method to use. 2012 irs tax return forms   The depreciation method you use depends on whether you meet the more-than-50%-use test. 2012 irs tax return forms More-than-50%-use test met. 2012 irs tax return forms   You meet this test if you use the computer more than 50% in your work. 2012 irs tax return forms If you meet this test, you can claim accelerated depreciation under the General Depreciation System (GDS). 2012 irs tax return forms In addition, you may be able to take the section 179 deduction for the year you place the item in service. 2012 irs tax return forms More-than-50%-use test not met. 2012 irs tax return forms   If you do not meet the more-than-50%-use test, you are limited to the straight line method of depreciation under the Alternative Depreciation System (ADS). 2012 irs tax return forms You also cannot claim the section 179 deduction. 2012 irs tax return forms (But if you use your computer in a home office, see the exception below. 2012 irs tax return forms ) Investment use. 2012 irs tax return forms   Your use of a computer in connection with investments (described later under Other Expenses ) does not count as use in your work. 2012 irs tax return forms However, you can combine your investment use with your work use in figuring your depreciation deduction. 2012 irs tax return forms Exception for computer used in a home office. 2012 irs tax return forms   The more-than-50%-use test does not apply to a computer used only in a part of your home that meets the requirements described later under Home Office . 2012 irs tax return forms You can claim accelerated depreciation using GDS for a computer used in a qualifying home office, even if you do not use it more than 50% in your work. 2012 irs tax return forms You also may be able to take a section 179 deduction for the year you place the computer in service. 2012 irs tax return forms See Computer used in a home office under How To Report, later. 2012 irs tax return forms More information. 2012 irs tax return forms   For more information on depreciation and the section 179 deduction for computers and other items used in a home office, see Business Furniture and Equipment in Publication 587. 2012 irs tax return forms Publication 946 has detailed information about the section 179 deduction and depreciation deductions using GDS and ADS. 2012 irs tax return forms Reporting your depreciation deduction. 2012 irs tax return forms    See How To Report, later, for information about reporting a deduction for depreciation. 2012 irs tax return forms You must keep records to prove your percentage of business and investment use. 2012 irs tax return forms Dues to Chambers of Commerce and Professional Societies You may be able to deduct dues paid to professional organizations (such as bar associations and medical associations) and to chambers of commerce and similar organizations, if membership helps you carry out the duties of your job. 2012 irs tax return forms Similar organizations include: Boards of trade, Business leagues, Civic or public service organizations, Real estate boards, and Trade associations. 2012 irs tax return forms Lobbying and political activities. 2012 irs tax return forms    You may not be able to deduct that part of your dues that is for certain lobbying and political activities. 2012 irs tax return forms See Lobbying Expenses under Nondeductible Expenses, later. 2012 irs tax return forms Educator Expenses If you were an eligible educator in 2013, you can deduct up to $250 of qualified expenses you paid in 2013 as an adjustment to gross income on Form 1040, line 23, rather than as a miscellaneous itemized deduction. 2012 irs tax return forms If you file Form 1040A, you can deduct these expenses on line 16. 2012 irs tax return forms If you and your spouse are filing jointly and both of you were eligible educators, the maximum deduction is $500. 2012 irs tax return forms However, neither spouse can deduct more than $250 of his or her qualified expenses. 2012 irs tax return forms Eligible educator. 2012 irs tax return forms   An eligible educator is a kindergarten through grade 12 teacher, instructor, counselor, principal, or aide in school for at least 900 hours during a school year. 2012 irs tax return forms Qualified expenses. 2012 irs tax return forms   Qualified expenses include ordinary and necessary expenses paid in connection with books, supplies, equipment (including computer equipment, software, and services), and other materials used in the classroom. 2012 irs tax return forms An ordinary expense is one that is common and accepted in your educational field. 2012 irs tax return forms A necessary expense is one that is helpful and appropriate for your profession as an educator. 2012 irs tax return forms An expense does not have to be required to be considered necessary. 2012 irs tax return forms   Qualified expenses do not include expenses for home schooling or for nonathletic supplies for courses in health or physical education. 2012 irs tax return forms You must reduce your qualified expenses by the following amounts. 2012 irs tax return forms Excludable U. 2012 irs tax return forms S. 2012 irs tax return forms series EE and I savings bond interest from Form 8815. 2012 irs tax return forms Nontaxable qualified state tuition program earnings. 2012 irs tax return forms Nontaxable earnings from Coverdell education savings accounts. 2012 irs tax return forms Any reimbursements you received for those expenses that were not reported to you on your Form W-2, box 1. 2012 irs tax return forms Educator expenses over limit. 2012 irs tax return forms   If you were an educator in 2013 and you had qualified expenses that you cannot take as an adjustment to gross income, you can deduct the rest as an itemized deduction subject to the 2% limit. 2012 irs tax return forms Home Office If you use a part of your home regularly and exclusively for business purposes, you may be able to deduct a part of the operating expenses and depreciation of your home. 2012 irs tax return forms You can claim this deduction for the business use of a part of your home only if you use that part of your home regularly and exclusively: As your principal place of business for any trade or business, As a place to meet or deal with your patients, clients, or customers in the normal course of your trade or business, or In the case of a separate structure not attached to your home, in connection with your trade or business. 2012 irs tax return forms The regular and exclusive business use must be for the convenience of your employer and not just appropriate and helpful in your job. 2012 irs tax return forms Principal place of business. 2012 irs tax return forms   If you have more than one place of business, the business part of your home is your principal place of business if: You use it regularly and exclusively for administrative or management activities of your trade or business, and You have no other fixed location where you conduct substantial administrative or management activities of your trade or business. 2012 irs tax return forms   Otherwise, the location of your principal place of business generally depends on the relative importance of the activities performed at each location and the time spent at each location. 2012 irs tax return forms You should keep records that will give the information needed to figure the deduction according to these rules. 2012 irs tax return forms Also keep canceled checks, substitute checks, or account statements and receipts of the expenses paid to prove the deductions you claim. 2012 irs tax return forms More information. 2012 irs tax return forms   See Publication 587 for more detailed information and a worksheet for figuring the deduction. 2012 irs tax return forms Job Search Expenses You can deduct certain expenses you have in looking for a new job in your present occupation, even if you do not get a new job. 2012 irs tax return forms You cannot deduct these expenses if: You are looking for a job in a new occupation, There was a substantial break between the ending of your last job and your looking for a new one, or You are looking for a job for the first time. 2012 irs tax return forms Employment and outplacement agency fees. 2012 irs tax return forms    You can deduct employment and outplacement agency fees you pay in looking for a new job in your present occupation. 2012 irs tax return forms Employer pays you back. 2012 irs tax return forms   If, in a later year, your employer pays you back for employment agency fees, you must include the amount you receive in your gross income up to the amount of your tax benefit in the earlier year. 2012 irs tax return forms See Recoveries in Publication 525. 2012 irs tax return forms Employer pays the employment agency. 2012 irs tax return forms   If your employer pays the fees directly to the employment agency and you are not responsible for them, you do not include them in your gross income. 2012 irs tax return forms Résumé. 2012 irs tax return forms   You can deduct amounts you spend for preparing and mailing copies of a résumé to prospective employers if you are looking for a new job in your present occupation. 2012 irs tax return forms Travel and transportation expenses. 2012 irs tax return forms   If you travel to an area and, while there, you look for a new job in your present occupation, you may be able to deduct travel expenses to and from the area. 2012 irs tax return forms You can deduct the travel expenses if the trip is primarily to look for a new job. 2012 irs tax return forms The amount of time you spend on personal activity compared to the amount of time you spend in looking for work is important in determining whether the trip is primarily personal or is primarily to look for a new job. 2012 irs tax return forms   Even if you cannot deduct the travel expenses to and from an area, you can deduct the expenses of looking for a new job in your present occupation while in the area. 2012 irs tax return forms    You can choose to use the standard mileage rate to figure your car expenses. 2012 irs tax return forms The 2013 rate for business use of a vehicle is 56½ cents per mile. 2012 irs tax return forms See Publication 463 for more information on travel and car expenses. 2012 irs tax return forms Legal Fees You can deduct legal fees related to doing or keeping your job. 2012 irs tax return forms Licenses and Regulatory Fees You can deduct the amount you pay each year to state or local governments for licenses and regulatory fees for your trade, business, or profession. 2012 irs tax return forms Occupational Taxes You can deduct an occupational tax charged at a flat rate by a locality for the privilege of working or conducting a business in the locality. 2012 irs tax return forms If you are an employee, you can claim occupational taxes only as a miscellaneous deduction subject to the 2% limit; you cannot claim them as a deduction for taxes elsewhere on your return. 2012 irs tax return forms Repayment of Income Aid Payment An “income aid payment” is one that is received under an employer's plan to aid employees who lose their jobs because of lack of work. 2012 irs tax return forms If you repay a lump-sum income aid payment that you received and included in income in an earlier year, you can deduct the repayment. 2012 irs tax return forms Research Expenses of a College Professor If you are a college professor, you can deduct your research expenses, including travel expenses, for teaching, lecturing, or writing and publishing on subjects that relate directly to your teaching duties. 2012 irs tax return forms You must have undertaken the research as a means of carrying out the duties expected of a professor and without expectation of profit apart from salary. 2012 irs tax return forms However, you cannot deduct the cost of travel as a form of education. 2012 irs tax return forms Rural Mail Carriers' Vehicle Expenses If your expenses to use a vehicle in performing services as a rural mail carrier are more than the amount of your reimbursements, you can deduct the unreimbursed expenses. 2012 irs tax return forms See chapter 4 of Publication 463 for more information. 2012 irs tax return forms Tools Used in Your Work Generally, you can deduct amounts you spend for tools used in your work if the tools wear out and are thrown away within 1 year from the date of purchase. 2012 irs tax return forms You can depreciate the cost of tools that have a useful life substantially beyond the tax year. 2012 irs tax return forms For more information about depreciation, see Publication 946. 2012 irs tax return forms Travel, Transportation, Meals, Entertainment, Gifts, and Local Lodging If you are an employee and have ordinary and necessary business-related expenses for travel away from home, local transportation, entertainment, and gifts, you may be able to deduct these expenses. 2012 irs tax return forms Generally, you must file Form 2106 or Form 2106-EZ to claim these expenses. 2012 irs tax return forms Travel expenses. 2012 irs tax return forms   Travel expenses are those incurred while traveling away from home for your employer. 2012 irs tax return forms You can deduct travel expenses paid or incurred in connection with a temporary work assignment. 2012 irs tax return forms Generally, you cannot deduct travel expenses paid or incurred in connection with an indefinite work assignment. 2012 irs tax return forms   Travel expenses may include: The cost of getting to and from your business destination (air, rail, bus, car, etc. 2012 irs tax return forms ), Meals and lodging while away from home, Taxi fares, Baggage charges, and Cleaning and laundry expenses. 2012 irs tax return forms   Travel expenses are discussed more fully in chapter 1 of Publication 463. 2012 irs tax return forms Temporary work assignment. 2012 irs tax return forms    If your assignment or job away from home in a single location is realistically expected to last (and does in fact last) for 1 year or less, it is temporary, unless there are facts and circumstances that indicate it is not. 2012 irs tax return forms Indefinite work assignment. 2012 irs tax return forms   If your assignment or job away from home in a single location is realistically expected to last for more than 1 year, it is indefinite, whether or not it actually lasts for more than 1 year. 2012 irs tax return forms If your assignment or job away from home in a single location is realistically expected to last for 1 year or less, but at some later date it is realistically expected to exceed 1 year, it will be treated as temporary (in the absence of facts and circumstances indicating otherwise) until the date that your realistic expectation changes, and it will be treated as indefinite after that date. 2012 irs tax return forms Federal crime investigation and prosecution. 2012 irs tax return forms   If you are a federal employee participating in a federal crime investigation or prosecution, you are not subject to the 1-year rule for deducting temporary travel expenses. 2012 irs tax return forms This means that you may be able to deduct travel expenses even if you are away from your tax home for more than 1 year. 2012 irs tax return forms   To qualify, the Attorney General must certify that you are traveling: For the Federal Government, In a temporary duty status, and To investigate, prosecute, or provide support services for the investigation or prosecution of a federal crime. 2012 irs tax return forms Armed Forces reservists traveling more than 100 miles from home. 2012 irs tax return forms   If you are a member of a reserve component of the Armed Forces of the United States and you travel more than 100 miles away from home in connection with your performance of services as a member of the reserves, you can deduct some of your travel expenses as an adjustment to gross income rather than as a miscellaneous itemized deduction. 2012 irs tax return forms The amount of expenses you can deduct as an adjustment to gross income is limited to the regular federal per diem rate (for lodging, meals, and incidental expenses) and the standard mileage rate (for car expenses) plus any parking fees, ferry fees, and tolls. 2012 irs tax return forms The balance, if any, is reported on Schedule A. 2012 irs tax return forms   You are a member of a reserve component of the Armed Forces of the United States if you are in the Army, Naval, Marine Corps, Air Force, Coast Guard Reserve, the Army National Guard of the United States, the Air National Guard of the United States, or the Reserve Corps of the Public Health Service. 2012 irs tax return forms   For more information on travel expenses, see Publication 463. 2012 irs tax return forms Local transportation expenses. 2012 irs tax return forms   Local transportation expenses are the expenses of getting from one workplace to another when you are not traveling away from home. 2012 irs tax return forms They include the cost of transportation by air, rail, bus, taxi, and the cost of using your car. 2012 irs tax return forms   You can choose to use the standard mileage rate to figure your car expenses. 2012 irs tax return forms The 2013 rate for business use of a vehicle is 56½ cents per mile. 2012 irs tax return forms    In general, the costs of commuting between your residence and your place of business are nondeductible. 2012 irs tax return forms Work at two places in a day. 2012 irs tax return forms   If you work at two places in a day, whether or not for the same employer, you can generally deduct the expenses of getting from one workplace to the other. 2012 irs tax return forms Temporary work location. 2012 irs tax return forms   You can deduct expenses incurred in going between your home and a temporary work location if at least one of the following applies. 2012 irs tax return forms The work location is outside the metropolitan area where you live and normally work. 2012 irs tax return forms You have at least one regular work location (other than your home) for the same trade or business. 2012 irs tax return forms (If this applies, the distance between your home and the temporary work location does not matter. 2012 irs tax return forms )   For this purpose, a work location is generally considered temporary if your work there is realistically expected to last (and does in fact last) for 1 year or less. 2012 irs tax return forms It is not temporary if your work there is realistically expected to last for more than 1 year, even if it actually lasts for 1 year or less. 2012 irs tax return forms If your work there initially is realistically expected to last for 1 year or less, but later is realistically expected to last for more than 1 year, the work location is generally considered temporary until the date your realistic expectation changes and not temporary after that date. 2012 irs tax return forms For more information, see chapter 1 of Publication 463. 2012 irs tax return forms Home office. 2012 irs tax return forms   You can deduct expenses incurred in going between your home and a workplace if your home is your principal place of business for the same trade or business. 2012 irs tax return forms (In this situation, whether the other workplace is temporary or regular and its distance from your home do not matter. 2012 irs tax return forms ) See Home Office , earlier, for a discussion on the use of your home as your principal place of business. 2012 irs tax return forms Meals and entertainment. 2012 irs tax return forms   Generally, you can deduct entertainment expenses (including entertainment-related meals) only if they are directly related to the active conduct of your trade or business. 2012 irs tax return forms However, the expense only needs to be associated with the active conduct of your trade or business if it directly precedes or follows a substantial and bona fide business-related discussion. 2012 irs tax return forms   You can deduct only 50% of your business-related meal and entertainment expenses unless the expenses meet certain exceptions. 2012 irs tax return forms You apply this 50% limit before you apply the 2%-of-adjusted-gross-income limit. 2012 irs tax return forms Meals when subject to “hours of service” limits. 2012 irs tax return forms   You can deduct 80% of your business-related meal expenses if you consume the meals during or incident to any period subject to the Department of Transportation's “hours of service” limits. 2012 irs tax return forms You apply this 80% limit before you apply the 2%-of-adjusted-gross-income limit. 2012 irs tax return forms Gift expenses. 2012 irs tax return forms   You can generally deduct up to $25 of business gifts you give to any one individual during the year. 2012 irs tax return forms The following items do not count toward the $25 limit. 2012 irs tax return forms Identical, widely distributed items costing $4 or less that have your name clearly and permanently imprinted. 2012 irs tax return forms Signs, racks, and promotional materials to be displayed on the business premises of the recipient. 2012 irs tax return forms Local lodging. 2012 irs tax return forms   If your employer provides or requires you to obtain lodging while you are not traveling away from home, you can deduct the cost of the lodging if it is: on a temporary basis, necessary for you to participate in or be available for a business meeting or employer function, and the costs are ordinary and necessary, but not lavish or extravagant. 2012 irs tax return forms   If your employer provides the lodging or reimburses you for the cost of the lodging, you can deduct the cost only if the value or the reimbursement is included in your gross income because it is reported as wages on your Form W-2. 2012 irs tax return forms Additional information. 2012 irs tax return forms    See Publication 463 for more information on travel, transportation, meal, entertainment, and gift expenses, and reimbursements for these expenses. 2012 irs tax return forms Union Dues and Expenses You can deduct dues and initiation fees you pay for union membership. 2012 irs tax return forms You can also deduct assessments for benefit payments to unemployed union members. 2012 irs tax return forms However, you cannot deduct the part of the assessments or contributions that provides funds for the payment of sick, accident, or death benefits. 2012 irs tax return forms Also, you cannot deduct contributions to a pension fund even if the union requires you to make the contributions. 2012 irs tax return forms You may not be able to deduct amounts you pay to the union that are related to certain lobbying and political activities. 2012 irs tax return forms See Lobbying Expenses under Nondeductible Expenses, later. 2012 irs tax return forms Work Clothes and Uniforms You can deduct the cost and upkeep of work clothes if the following two requirements are met. 2012 irs tax return forms You must wear them as a condition of your employment. 2012 irs tax return forms The clothes are not suitable for everyday wear. 2012 irs tax return forms It is not enough that you wear distinctive clothing. 2012 irs tax return forms The clothing must be specifically required by your employer. 2012 irs tax return forms Nor is it enough that you do not, in fact, wear your work clothes away from work. 2012 irs tax return forms The clothing must not be suitable for taking the place of your regular clothing. 2012 irs tax return forms Examples of workers who may be able to deduct the cost and upkeep of work clothes are: delivery workers, firefighters, health care workers, law enforcement officers, letter carriers, professional athletes, and transportation workers (air, rail, bus, etc. 2012 irs tax return forms ). 2012 irs tax return forms Musicians and entertainers can deduct the cost of theatrical clothing and accessories that are not suitable for everyday wear. 2012 irs tax return forms However, work clothing consisting of white cap, white shirt or white jacket, white bib overalls, and standard work shoes, which a painter is required by his union to wear on the job, is not distinctive in character or in the nature of a uniform. 2012 irs tax return forms Similarly, the costs of buying and maintaining blue work clothes worn by a welder at the request of a foreman are not deductible. 2012 irs tax return forms Protective clothing. 2012 irs tax return forms   You can deduct the cost of protective clothing required in your work, such as safety shoes or boots, safety glasses, hard hats, and work gloves. 2012 irs tax return forms   Examples of workers who may be required to wear safety items are: carpenters, cement workers, chemical workers, electricians, fishing boat crew members, machinists, oil field workers, pipe fitters, steamfitters, and truck drivers. 2012 irs tax return forms Military uniforms. 2012 irs tax return forms   You generally cannot deduct the cost of your uniforms if you are on full-time active duty in the armed forces. 2012 irs tax return forms However, if you are an armed forces reservist, you can deduct the unreimbursed cost of your uniform if military regulations restrict you from wearing it except while on duty as a reservist. 2012 irs tax return forms In figuring the deduction, you must reduce the cost by any nontaxable allowance you receive for these expenses. 2012 irs tax return forms   If local military rules do not allow you to wear fatigue uniforms when you are off duty, you can deduct the amount by which the cost of buying and keeping up these uniforms is more than the uniform allowance you receive. 2012 irs tax return forms   If you are a student at an armed forces academy, you cannot deduct the cost of your uniforms if they replace regular clothing. 2012 irs tax return forms However, you can deduct the cost of insignia, shoulder boards, and related items. 2012 irs tax return forms    You can deduct the cost of your uniforms if you are a civilian faculty or staff member of a military school. 2012 irs tax return forms Work-Related Education You can deduct expenses you have for education, even if the education may lead to a degree, if the education meets at least one of the following two tests. 2012 irs tax return forms It maintains or improves skills required in your present work. 2012 irs tax return forms It is required by your employer or the law to keep your salary, status, or job, and the requirement serves a business purpose of your employer. 2012 irs tax return forms You cannot deduct expenses you have for education, even though one or both of the preceding tests are met, if the education: Is needed to meet the minimum educational requirements to qualify you in your trade or business, or Is part of a program of study that will lead to qualifying you in a new trade or business. 2012 irs tax return forms If your education qualifies, you can deduct expenses for tuition, books, supplies, laboratory fees, and similar items, and certain transportation costs. 2012 irs tax return forms If the education qualifies you for a new trade or business, you cannot deduct the educational expenses even if you do not intend to enter that trade or business. 2012 irs tax return forms Travel as education. 2012 irs tax return forms   You cannot deduct the cost of travel that in itself constitutes a form of education. 2012 irs tax return forms For example, a French teacher who travels to France to maintain general familiarity with the French language and culture cannot deduct the cost of the trip as an educational expense. 2012 irs tax return forms More information. 2012 irs tax return forms    See Publication 970, Tax Benefits for Education, for a complete discussion of the deduction for work-related education expenses. 2012 irs tax return forms Education Expenses During Unemployment If you stop working for a year or less in order to get education in order to maintain or improve skills needed in your present work and then return to the same general type of work, your absence is considered temporary. 2012 irs tax return forms Education that you get during a temporary absence is qualifying work-related education if it maintains or improves skills needed in your present work. 2012 irs tax return forms Tax Preparation Fees You can usually deduct tax preparation fees on the return for the year in which you pay them. 2012 irs tax return forms Thus, on your 2013 return, you can deduct fees paid in 2013 for preparing your 2012 return. 2012 irs tax return forms These fees include the cost of tax preparation software programs and tax publications. 2012 irs tax return forms They also include any fee you paid for electronic filing of your return. 2012 irs tax return forms See Tax preparation fees under How To Report, later. 2012 irs tax return forms Other Expenses You can deduct certain other expenses as miscellaneous itemized deductions subject to the 2%-of-adjusted-gross-income limit. 2012 irs tax return forms On Schedule A (Form 1040), line 23, or Schedule A (Form 1040NR), line 9, you can deduct the ordinary and necessary expenses that you pay: To produce or collect income that must be included in your gross income, To manage, conserve, or maintain property held for producing such income, or To determine, contest, pay, or claim a refund of any tax. 2012 irs tax return forms You can deduct expenses you pay for the purposes in (1) and (2) above only if they are reasonable and closely related to these purposes. 2012 irs tax return forms These other expenses include the following items. 2012 irs tax return forms Appraisal fees for a casualty loss or charitable contribution. 2012 irs tax return forms Casualty and theft losses from property used in performing services as an employee. 2012 irs tax return forms Clerical help and office rent in caring for investments. 2012 irs tax return forms Depreciation on home computers used for investments. 2012 irs tax return forms Excess deductions (including administrative expenses) allowed a beneficiary on termination of an estate or trust. 2012 irs tax return forms Fees to collect interest and dividends. 2012 irs tax return forms Hobby expenses, but generally not more than hobby income. 2012 irs tax return forms Indirect miscellaneous deductions from pass-through entities. 2012 irs tax return forms Investment fees and expenses. 2012 irs tax return forms Legal fees related to producing or collecting taxable income or getting tax advice. 2012 irs tax return forms Loss on deposits in an insolvent or bankrupt financial institution. 2012 irs tax return forms Loss on traditional IRAs or Roth IRAs, when all amounts have been distributed to you. 2012 irs tax return forms Repayments of income. 2012 irs tax return forms Repayments of social security benefits. 2012 irs tax return forms Safe deposit box rental, except for storing jewelry and other personal effects. 2012 irs tax return forms Service charges on dividend reinvestment plans. 2012 irs tax return forms Tax advice fees. 2012 irs tax return forms Trustee's fees for your IRA, if separately billed and paid. 2012 irs tax return forms If the expenses you pay produce income that is only partially taxable, see Tax-Exempt Income Expenses, later, under Nondeductible Expenses. 2012 irs tax return forms Appraisal Fees You can deduct appraisal fees if you pay them to figure a casualty loss or the fair market value of donated property. 2012 irs tax return forms Casualty and Theft Losses You can deduct a casualty or theft loss as a miscellaneous itemized deduction subject to the 2% limit if you used the damaged or stolen property in performing services as an employee. 2012 irs tax return forms First report the loss in Section B of Form 4684, Casualties and Thefts. 2012 irs tax return forms You may also have to include the loss on Form 4797, Sales of Business Property, if you are otherwise required to file that form. 2012 irs tax return forms To figure your deduction, add all casualty or theft losses from this type of property included on Form 4684, lines 32 and 38b, or Form 4797, line 18a. 2012 irs tax return forms For more information on casualty and theft losses, see Publication 547, Casualties, Disasters, and Thefts. 2012 irs tax return forms Clerical Help and Office Rent You can deduct office expenses, such as rent and clerical help, that you have in connection with your investments and collecting the taxable income on them. 2012 irs tax return forms Credit or Debit Card Convenience Fees You can deduct the convenience fee charged by the card processor for paying your income tax (including estimated tax payments) by credit or debit card. 2012 irs tax return forms The fees are deductible on the return for the year in which you paid them. 2012 irs tax return forms For example, fees charged to payments made in 2013 can be claimed on the 2013 tax return. 2012 irs tax return forms Depreciation on Home Computer You can deduct depreciation on your home computer if you use it to produce income (for example, to manage your investments that produce taxable income). 2012 irs tax return forms You generally must depreciate the computer using the straight line method over the Alternative Depreciation System (ADS) recovery period. 2012 irs tax return forms But if you work as an employee and also use the computer in that work, see Depreciation on Computers under Unreimbursed Employee Expenses, earlier. 2012 irs tax return forms For more information on depreciation, see Publication 946. 2012 irs tax return forms Excess Deductions of an Estate If an estate's total deductions in its last tax year are more than its gross income for that year, the beneficiaries succeeding to the estate's property can deduct the excess. 2012 irs tax return forms Do not include deductions for the estate's personal exemption and charitable contributions when figuring the estate's total deductions. 2012 irs tax return forms The beneficiaries can claim the deduction only for the tax year in which, or with which, the estate terminates, whether the year of termination is a normal year or a short tax year. 2012 irs tax return forms For more information, see Termination of Estate in Publication 559, Survivors, Executors, and Administrators. 2012 irs tax return forms Fees To Collect Interest and Dividends You can deduct fees you pay to a broker, bank, trustee, or similar agent to collect your taxable bond interest or dividends on shares of stock. 2012 irs tax return forms But you cannot deduct a fee you pay to a broker to buy investment property, such as stocks or bonds. 2012 irs tax return forms You must add the fee to the cost of the property. 2012 irs tax return forms You cannot deduct the fee you pay to a broker to sell securities. 2012 irs tax return forms You can use the fee only to figure gain or loss from the sale. 2012 irs tax return forms See the instructions for Schedule D (Form 1040) for information on how to report the fee. 2012 irs tax return forms Hobby Expenses You can generally deduct hobby expenses, but only up to the amount of hobby income. 2012 irs tax return forms A hobby is not a business because it is not carried on to make a profit. 2012 irs tax return forms See Not-for-Profit Activities in chapter 1 of Publication 535. 2012 irs tax return forms Indirect Deductions of Pass-Through Entities Pass-through entities include partnerships, S corporations, and mutual funds that are not publicly offered. 2012 irs tax return forms Deductions of pass-through entities are passed through to the partners or shareholders. 2012 irs tax return forms The partners or shareholders can deduct their share of passed-through deductions for investment expenses as miscellaneous itemized deductions subject to the 2% limit. 2012 irs tax return forms Example. 2012 irs tax return forms You are a member of an investment club that is formed solely to invest in securities. 2012 irs tax return forms The club is treated as a partnership. 2012 irs tax return forms The partnership's income is solely from taxable dividends, interest, and gains from sales of securities. 2012 irs tax return forms In this case, you can deduct your share of the partnership's operating expenses as miscellaneous itemized deductions subject to the 2% limit. 2012 irs tax return forms However, if the investment club partnership has investments that also produce nontaxable income, you cannot deduct your share of the partnership's expenses that produce the nontaxable income. 2012 irs tax return forms Publicly offered mutual funds. 2012 irs tax return forms   Publicly offered mutual funds do not pass deductions for investment expenses through to shareholders. 2012 irs tax return forms A mutual fund is “publicly offered” if it is: Continuously offered pursuant to a public offering, Regularly traded on an established securities market, or Held by or for at least 500 persons at all times during the tax year. 2012 irs tax return forms   A publicly offered mutual fund will send you a Form 1099-DIV, Dividends and Distributions, or a substitute form, showing the net amount of dividend income (gross dividends minus investment expenses). 2012 irs tax return forms This net figure is the amount you report on your return as income. 2012 irs tax return forms You cannot further deduct investment expenses related to publicly offered mutual funds because they are already included as part of the net income amount. 2012 irs tax return forms Information returns. 2012 irs tax return forms   You should receive information returns from pass-through entities. 2012 irs tax return forms Partnerships and S corporations. 2012 irs tax return forms   These entities issue Schedule K-1, which lists the items and amounts you must report, and identifies the tax return schedules and lines to use. 2012 irs tax return forms Nonpublicly offered mutual funds. 2012 irs tax return forms   These funds will send you a Form 1099-DIV, or a substitute form, showing your share of gross income and investment expenses. 2012 irs tax return forms You can claim the expenses only as a miscellaneous itemized deduction subject to the 2% limit. 2012 irs tax return forms Investment Fees and Expenses You can deduct investment fees, custodial fees, trust administration fees, and other expenses you paid for managing your investments that produce taxable income. 2012 irs tax return forms Legal Expenses You can usually deduct legal expenses that you incur in attempting to produce or collect taxable income or that you pay in connection with the determination, collection, or refund of any tax. 2012 irs tax return forms You can also deduct legal expenses that are: Related to either doing or keeping your job, such as those you paid to defend yourself against criminal charges arising out of your trade or business, For tax advice related to a divorce if the bill specifies how much is for tax advice and it is determined in a reasonable way, or To collect taxable alimony. 2012 irs tax return forms You can deduct expenses of resolving tax issues relating to profit or loss from business (Schedule C or C-EZ), rentals or royalties (Schedule E), or farm income and expenses (Schedule F) on the appropriate schedule. 2012 irs tax return forms You deduct expenses of resolving nonbusiness tax issues on Schedule A (Form 1040 or Form 1040NR). 2012 irs tax return forms See Tax Preparation Fees, earlier. 2012 irs tax return forms Unlawful discrimination claims. 2012 irs tax return forms   You may be able to deduct, as an adjustment to income on Form 1040, line 36, or Form 1040NR, line 35, rather than as a miscellaneous itemized deduction, attorney fees and court costs for actions settled or decided after October 22, 2004, involving a claim of unlawful discrimination, a claim against the U. 2012 irs tax return forms S. 2012 irs tax return forms Government, or a claim made under section 1862(b)(3)(A) of the Social Security Act. 2012 irs tax return forms However, the amount you can deduct on Form 1040, line 36, or Form 1040NR, line 35, is limited to the amount of the judgment or settlement you are including in income for the tax year. 2012 irs tax return forms See Publication 525 for more information. 2012 irs tax return forms Loss on Deposits A loss on deposits can occur when a bank, credit union, or other financial institution becomes insolvent or bankrupt. 2012 irs tax return forms If you can reasonably estimate the amount of your loss on money you have on deposit in a financial institution that becomes insolvent or bankrupt, you can generally choose to deduct it in the current year even though its exact amount has not been finally determined. 2012 irs tax return forms If elected, the casualty loss is subject to certain deduction limitations. 2012 irs tax return forms The election is made on Form 4684. 2012 irs tax return forms Once you make this choice, you cannot change it without IRS approval. 2012 irs tax return forms If none of the deposit is federally insured, you can deduct the loss in either of the following ways. 2012 irs tax return forms As an ordinary loss (as a miscellaneous itemized deduction subject to the 2% limit). 2012 irs tax return forms Write the name of the financial institution and “Insolvent Financial Institution” beside the amount on Schedule A (Form 1040), line 23, or Schedule A (Form 1040NR), line 9. 2012 irs tax return forms This deduction is limited to $20,000 ($10,000 if you are married filing separately) for each financial institution, reduced by any expected state insurance proceeds. 2012 irs tax return forms As a casualty loss. 2012 irs tax return forms Report it on Form 4684 first and then on Schedule A (Form 1040). 2012 irs tax return forms See Publication 547 for details. 2012 irs tax return forms As a nonbusiness bad debt. 2012 irs tax return forms Report it on Schedule D (Form 1040). 2012 irs tax return forms If any part of the deposit is federally insured, you can deduct the loss only as a casualty loss. 2012 irs tax return forms Exception. 2012 irs tax return forms   You cannot make this choice if you are a 1%-or-more-owner or an officer of the financial institution, or are related to such owner or officer. 2012 irs tax return forms For a definition of “related,” see Deposit in Insolvent or Bankrupt Financial Institution in chapter 4 of Publication 550. 2012 irs tax return forms Actual loss different from estimated loss. 2012 irs tax return forms   If you make this choice and your actual loss is less than your estimated loss, you must include the excess in income. 2012 irs tax return forms See Recoveries in Publication 525. 2012 irs tax return forms If your actual loss is more than your estimated loss, treat the excess loss as explained under Choice not made, next. 2012 irs tax return forms Choice not made. 2012 irs tax return forms   If you do not make this choice (or if you have an excess actual loss after choosing to deduct your estimated loss), treat your loss (or excess loss) as a nonbusiness bad debt (deductible as a short-term capital loss) in the year its amount is finally determined. 2012 irs tax return forms See Nonbusiness Bad Debts in chapter 4 of Publication 550. 2012 irs tax return forms Loss on IRA If you have a loss on your traditional IRA (or Roth IRA) investment, you can deduct the loss as a miscellaneous itemized deduction subject to the 2% limit, but only when all the amounts in all your traditional IRA (or Roth IRA) accounts have been distributed to you and the total distributions are less than your unrecovered basis. 2012 irs tax return forms For more information, see Publication 590, Individual Retirement Arrangements (IRAs). 2012 irs tax return forms Repayments of Income If you had to repay an amount that you included in income in an earlier year, you may be able to deduct the amount you repaid. 2012 irs tax return forms If the amount you had to repay was ordinary income of $3,000 or less, the deduction is subject to the 2% limit. 2012 irs tax return forms If it was more than $3,000, see Repayments Under Claim of Right under Deductions Not Subject to the 2% Limit, later. 2012 irs tax return forms Repayments of Social Security Benefits If the total of the amounts in box 5 (net benefits for 2013) of all your Forms SSA-1099, Social Security Benefit Statement, and Forms RRB-1099, Payments By the Railroad Retirement Board, is a negative figure (a figure in parentheses), you may be able to take a miscellaneous itemized deduction subject to the 2% limit. 2012 irs tax return forms The amount you can deduct is the part of the negative figure that represents an amount you included in gross income in an earlier year. 2012 irs tax return forms The amount in box 5 of Form SSA-1099 or RRB-1099 is the net amount of your benefits for the year. 2012 irs tax return forms It will be a negative figure if the amount of benefits you repaid in 2013 (box 4) is more than the gross amount of benefits paid to you in 2013 (box 3). 2012 irs tax return forms If the deduction is more than $3,000, you will have to use a special computation to figure your tax. 2012 irs tax return forms See Publication 915, Social Security and Equivalent Railroad Retirement Benefits, for additional information. 2012 irs tax return forms Safe Deposit Box Rent You can deduct safe deposit box rent if you use the box to store taxable income-producing stocks, bonds, or investment-related papers and documents. 2012 irs tax return forms You cannot deduct the rent if you use the box only for jewelry, other personal items, or tax-exempt securities. 2012 irs tax return forms Service Charges on Dividend Reinvestment Plans You can deduct service charges you pay as a subscriber in a dividend reinvestment plan. 2012 irs tax return forms These service charges include payments for: Holding shares acquired through a plan, Collecting and reinvesting cash dividends, and Keeping individual records and providing detailed statements of accounts. 2012 irs tax return forms Trustee's Administrative Fees for IRA Trustee's administrative fees that are billed separately and paid by you in connection with your IRA are deductible (if they are ordinary and necessary) as a miscellaneous itemized deduction subject to the 2% limit. 2012 irs tax return forms Deductions Not Subject to the 2% Limit You can deduct the items listed below as miscellaneous itemized deductions. 2012 irs tax return forms They are not subject to the 2% limit. 2012 irs tax return forms Report these items on Schedule A (Form 1040), line 28, or Schedule A (Form 1040NR), line 14. 2012 irs tax return forms List of Deductions Amortizable premium on taxable bonds. 2012 irs tax return forms Casualty and theft losses from income-producing property. 2012 irs tax return forms Federal estate tax on income in respect of a decedent. 2012 irs tax return forms Gambling losses up to the amount of gambling winnings. 2012 irs tax return forms Impairment-related work expenses of persons with disabilities. 2012 irs tax return forms Loss from other activities from Schedule K-1 (Form 1065-B), box 2. 2012 irs tax return forms Losses from Ponzi-type investment schemes. 2012 irs tax return forms Repayments of more than $3,000 under a claim of right. 2012 irs tax return forms Unrecovered investment in an annuity. 2012 irs tax return forms Amortizable Premium on Taxable Bonds In general, if the amount you pay for a bond is greater than its stated principal amount, the excess is bond premium. 2012 irs tax return forms You can elect to amortize the premium on taxable bonds. 2012 irs tax return forms The amortization of the premium is generally an offset to interest income on the bond rather than a separate deduction item. 2012 irs tax return forms Pre-1998 election to amortize bond premium. 2012 irs tax return forms   Generally, if you first elected to amortize bond premium before 1998, the above treatment of the premium does not apply to bonds you acquired before 1988. 2012 irs tax return forms Bonds acquired after October 22, 1986, and before 1988. 2012 irs tax return forms   The amortization of the premium on these bonds is investment interest expense subject to the investment interest limit, unless you chose to treat it as an offset to interest income on the bond. 2012 irs tax return forms Bonds acquired before October 23, 1986. 2012 irs tax return forms   The amortization of the premium on these bonds is a miscellaneous itemized deduction not subject to the 2% limit. 2012 irs tax return forms Deduction for excess premium. 2012 irs tax return forms   On certain bonds (such as bonds that pay a variable rate of interest or that provide for an interest-free period), the amount of bond premium allocable to a period may exceed the amount of stated interest allocable to the period. 2012 irs tax return forms If this occurs, treat the excess as a miscellaneous itemized deduction that is not subject to the 2% limit. 2012 irs tax return forms However, the amount deductible is limited to the amount by which your total interest inclusions on the bond in prior periods exceed the total amount you treated as a bond premium deduction on the bond in prior periods. 2012 irs tax return forms If any of the excess bond premium cannot be deducted because of the limit, this amount is carried forward to the next period and is treated as bond premium allocable to that period. 2012 irs tax return forms    Pre-1998 choice to amortize bond premium. 2012 irs tax return forms If you made the choice to amortize the premium on taxable bonds before 1998, you can deduct the bond premium amortization that is more than your interest income only for bonds acquired during 1998 and later years. 2012 irs tax return forms More information. 2012 irs tax return forms    For more information on bond premium, see Bond Premium Amortization in chapter 3 of Publication 550. 2012 irs tax return forms Casualty and Theft Losses of Income-Producing Property You can deduct a casualty or theft loss as a miscellaneous itemized deduction not subject to the 2% limit if the damaged or stolen property was income-producing property (property held for investment, such as stocks, notes, bonds, gold, silver, vacant lots, and works of art). 2012 irs tax return forms First report the loss in Section B of Form 4684. 2012 irs tax return forms You may also have to include the loss on Form 4797, Sales of Business Property, if you are otherwise required to file that form. 2012 irs tax return forms To figure your deduction, add all casualty or theft losses from this type of property included on Form 4684, lines 32 and 38b, or Form 4797, line 18a. 2012 irs tax return forms For more information on casualty and theft losses, see Publication 547. 2012 irs tax return forms Federal Estate Tax on Income in Respect of a Decedent You can deduct the federal estate tax attributable to income in respect of a decedent that you as a beneficiary include in your gross income. 2012 irs tax return forms Income in respect of the decedent is gross income that the decedent would have received had death not occurred and that was not properly includible in the decedent's final income tax return. 2012 irs tax return forms See Publication 559 for information about figuring the amount of this deduction. 2012 irs tax return forms Gambling Losses Up to the Amount of Gambling Winnings You must report the full amount of your gambling winnings for the year on Form 1040, line 21. 2012 irs tax return forms You deduct your gambling losses for the year on Schedule A (Form 1040), line 28. 2012 irs tax return forms You cannot deduct gambling losses that are more than your winnings. 2012 irs tax return forms Generally, nonresident aliens cannot deduct gambling losses on Schedule A (Form 1040NR). 2012 irs tax return forms You cannot reduce your gambling winnings by your gambling losses and report the difference. 2012 irs tax return forms You must report the full amount of your winnings as income and claim your losses (up to the amount of winnings) as an itemized deduction. 2012 irs tax return forms Therefore, your records should show your winnings separately from your losses. 2012 irs tax return forms Diary of winnings and losses. 2012 irs tax return forms You must keep an accurate diary or similar record of your losses and winnings. 2012 irs tax return forms Your diary should contain at least the following information. 2012 irs tax return forms The date and type of your specific wager or wagering activity. 2012 irs tax return forms The name and address or location of the gambling establishment. 2012 irs tax return forms The names of other persons present with you at the gambling establishment. 2012 irs tax return forms The amount(s) you won or lost. 2012 irs tax return forms Proof of winnings and losses. 2012 irs tax return forms   In addition to your diary, you should also have other documentation. 2012 irs tax return forms You can generally prove your winnings and losses through Form W-2G, Certain Gambling Winnings, Form 5754, Statement by Person(s) Receiving Gambling Winnings, wagering tickets, canceled checks, substitute checks, credit records, bank withdrawals, and statements of actual winnings or payment slips provided to you by the gambling establishment. 2012 irs tax return forms   For specific wagering transactions, you can use the following items to support your winnings and losses. 2012 irs tax return forms    These recordkeeping suggestions are intended as general guidelines to help you establish your winnings and losses. 2012 irs tax return forms They are not all-inclusive. 2012 irs tax return forms Your tax liability depends on your particular facts and circumstances. 2012 irs tax return forms Keno. 2012 irs tax return forms   Copies of the keno tickets you purchased that were validated by the gambling establishment, copies of your casino credit records, and copies of your casino check cashing records. 2012 irs tax return forms Slot machines. 2012 irs tax return forms   A record of the machine number and all winnings by date and time the machine was played. 2012 irs tax return forms Table games (twenty-one (blackjack), craps, poker, baccarat, roulette, wheel of fortune, etc. 2012 irs tax return forms ). 2012 irs tax return forms   The number of the table at which you were playing. 2012 irs tax return forms Casino credit card data indicating whether the credit was issued in the pit or at the cashier's cage. 2012 irs tax return forms Bingo. 2012 irs tax return forms   A record of the number of games played, cost of tickets purchased, and amounts collected on winning tickets. 2012 irs tax return forms Supplemental records include any receipts from the casino, parlor, etc. 2012 irs tax return forms Racing (horse, harness, dog, etc. 2012 irs tax return forms ). 2012 irs tax return forms   A record of the races, amounts of wagers, amounts collected on winning tickets, and amounts lost on losing tickets. 2012 irs tax return forms Supplemental records include unredeemed tickets and payment records from the racetrack. 2012 irs tax return forms Lotteries. 2012 irs tax return forms   A record of ticket purchases, dates, winnings, and losses. 2012 irs tax return forms Supplemental records include unredeemed tickets, payment slips, and winnings statements. 2012 irs tax return forms Impairment-Related Work Expenses If you have a physical or mental disability that limits your being employed, or substantially limits one or more of your major life activities, such as performing manual tasks, walking, speaking, breathing, learning, and working, you can deduct your impairment-related work expenses. 2012 irs tax return forms Impairment-related work expenses are ordinary and necessary business expenses for attendant care services at your place of work and other expenses in connection with your place of work that are necessary for you to be able to work. 2012 irs tax return forms Example. 2012 irs tax return forms You are blind. 2012 irs tax return forms You must use a reader to do your work. 2012 irs tax return forms You use the reader both during your regular working hours at your place of work and outside your regular working hours away from your place of work. 2012 irs tax return forms The reader's services are only for your work. 2012 irs tax return forms You can deduct your expenses for the reader as impairment-related work expenses. 2012 irs tax return forms Self-employed. 2012 irs tax return forms   If you are self-employed, enter your impairment-related work expenses on the appropriate form (Schedule C, C-EZ, E, or F) used to report your business income and expenses. 2012 irs tax return forms See Impairment-related work expenses. 2012 irs tax return forms , later under How To Report. 2012 irs tax return forms Loss From Other Activities From Schedule K-1 (Form 1065-B), Box 2 If the amount reported in Schedule K-1 (Form 1065-B), box 2, is a loss, report it on Schedule A (Form 1040), line 28, or Schedule A (Form 1040NR), line 14 (only if effectively connected with a U. 2012 irs tax return forms S. 2012 irs tax return forms trade or business). 2012 irs tax return forms It is not subject to the passive activity limitations. 2012 irs tax return forms Officials Paid on a Fee Basis If you are a fee-basis official, you can claim your expenses in performing services in that job as an adjustment to income rather than as a miscellaneous itemized deduction. 2012 irs tax return forms See Publication 463 for more information. 2012 irs tax return forms Performing Artists If you are a qualified performing artist, you can deduct your employee business expenses as an adjustment to income rather than as a miscellaneous itemized deduction. 2012 irs tax return forms If you are an employee, complete Form 2106 or Form 2106-EZ. 2012 irs tax return forms See Publication 463 for more information. 2012 irs tax return forms Losses From Ponzi-type Investment Schemes These losses are deductible as theft losses of income-producing property on your tax return for the year the loss was discovered. 2012 irs tax return forms You figure the deductible loss in Section B of Form 4684. 2012 irs tax return forms However, if you qualify to use Revenue Procedure 2009-20 (as modified by Revenue Procedure 2011-58) and you choose to follow the procedures in the guidance, complete Section C of Form 4684 before completing Section B. 2012 irs tax return forms Section C of Form 4684 replaces Appendix A in Revenue Procedure 2009-20. 2012 irs tax return forms You do not need to complete Appendix A. 2012 irs tax return forms See the Form 4684 instructions and Publication 547, Casualties, Disasters, and Thefts, for more information. 2012 irs tax return forms Repayments Under Claim of Right If you had to repay more than $3,000 that you included in your income in an earlier year because at the time you thought you had an unrestricted right to it, you may be able to deduct the amount you repaid, or take a credit against your tax. 2012 irs tax return forms See Repayments in Publication 525 for more information. 2012 irs tax return forms Unrecovered Investment in Annuity A retiree who contributed to the cost of an annuity can exclude from income a part of each payment received as a tax-free return of the retiree's investment. 2012 irs tax return forms If the retiree dies before the entire investment is recovered tax free, any unrecovered investment can be deducted on the retiree's final income tax return. 2012 irs tax return forms See Publication 575, Pension and Annuity Income, for more information about the tax treatment of pensions and annuities. 2012 irs tax return forms Nondeductible Expenses You cannot deduct the following expenses. 2012 irs tax return forms List of Nondeductible Expenses Adoption expenses. 2012 irs tax return forms Broker's commissions. 2012 irs tax return forms Burial or funeral expenses, including the cost of a cemetery lot. 2012 irs tax return forms Campaign expenses. 2012 irs tax return forms Capital expenses. 2012 irs tax return forms Check-writing fees. 2012 irs tax return forms Club dues. 2012 irs tax return forms Commuting expenses. 2012 irs tax return forms Fees and licenses, such as car licenses, marriage licenses, and dog tags. 2012 irs tax return forms Fines and penalties, such as parking tickets. 2012 irs tax return forms Health spa expenses. 2012 irs tax return forms Hobby losses—but see Hobby Expenses, earlier. 2012 irs tax return forms Home repairs, insurance, and rent. 2012 irs tax return forms Home security system. 2012 irs tax return forms Illegal bribes and kickbacks—see Bribes and kickbacks in chapter 11 of Publication 535. 2012 irs tax return forms Investment-related seminars. 2012 irs tax return forms Life insurance premiums paid by the insured. 2012 irs tax return forms Lobbying expenses. 2012 irs tax return forms Losses from the sale of your home, furniture, personal car, etc. 2012 irs tax return forms Lost or misplaced cash or property. 2012 irs tax return forms Lunches with co-workers. 2012 irs tax return forms Meals while working late. 2012 irs tax return forms Medical expenses as business expenses other than medical examinations required by your employer. 2012 irs tax return forms Personal disability insurance premiums. 2012 irs tax return forms Personal legal expenses. 2012 irs tax return forms Personal, living, or family expenses. 2012 irs tax return forms Political contributions. 2012 irs tax return forms Professional accreditation fees. 2012 irs tax return forms Professional reputation, expenses to improve. 2012 irs tax return forms Relief fund contributions. 2012 irs tax return forms Residential telephone line. 2012 irs tax return forms Stockholders' meeting, expenses of attending. 2012 irs tax return forms Tax-exempt income, expenses of earning or collecting. 2012 irs tax return forms The value of wages never received or lost vacation time. 2012 irs tax return forms Travel expenses for another individual. 2012 irs tax return forms Voluntary unemployment benefit fund contributions. 2012 irs tax return forms Wristwatches. 2012 irs tax return forms Adoption Expenses You cannot deduct the expenses of adopting a child but you may be able to take a credit for those expenses. 2012 irs tax return forms For details, see Form 8839, Qualified Adoption Expenses. 2012 irs tax return forms Commissions Commissions paid on the purchase of securities are not deductible, either as business or nonbusiness expenses. 2012 irs tax return forms Instead, these fees must be added to the taxpayer's cost of the securities. 2012 irs tax return forms Commissions paid on the sale are deductible as business expenses only by dealers. 2012 irs tax return forms Campaign Expenses You cannot deduct campaign expenses of a candidate for any office, even if the candidate is running for reelection to the office. 2012 irs tax return forms These include qualification and registration fees for primary elections. 2012 irs tax return forms Legal fees. 2012 irs tax return forms   You cannot deduct legal fees paid to defend charges that arise from participation in a political campaign. 2012 irs tax return forms Capital Expenses You cannot currently deduct amounts paid to buy property that has a useful life substantially beyond the tax year or amounts paid to increase the value or prolong the life of property. 2012 irs tax return forms If you use such property in your work, you may be able to take a depreciation deduction. 2012 irs tax return forms See Publication 946. 2012 irs tax return forms If the property is a car used in your work, also see Publication 463. 2012 irs tax return forms Check-Writing Fees on Personal Account If you have a personal checking account, you cannot deduct fees charged by the bank for the privilege of writing checks, even if the account pays interest. 2012 irs tax return forms Club Dues Generally, you cannot deduct the cost of membership in any club organized for business, pleasure, recreation, or other social purpose. 2012 irs tax return forms This includes business, social, athletic, luncheon, sporting, airline, hotel, golf, and country clubs. 2012 irs tax return forms You cannot deduct dues paid to an organization if one of its main purposes is to: Conduct entertainment activities for members or their guests, or Provide members or their guests with access to entertainment facilities. 2012 irs tax return forms Dues paid to airline, hotel, and luncheon clubs are not deductible. 2012 irs tax return forms Commuting Expenses You cannot deduct commuting expenses (the cost of transportation between your home and your main or regular place of work). 2012 irs tax return forms If you haul tools, instruments, or other items in your car to and from work, you can deduct only the additional cost of hauling the items, such as the rent on a trailer to carry the items. 2012 irs tax return forms Fines or Penalties You cannot deduct fines or penalties you pay to a governmental unit for violating a law. 2012 irs tax return forms This includes an amount paid in settlement of your actual or potential liability for a fine or penalty (civil or criminal). 2012 irs tax return forms Fines or penalties include parking tickets, tax penalties, and penalties deducted from teachers' paychecks after an illegal strike. 2012 irs tax return forms Health Spa Expenses You cannot deduct health spa expenses, even if there is a job requirement to stay in excellent physical condition, such as might be required of a law enforcement officer. 2012 irs tax return forms Home Security System You cannot deduct the cost of a home security system as a miscellaneous deduction. 2012 irs tax return forms However, you may be able to claim a deduction for a home security system as a business expense if you have a home office. 2012 irs tax return forms See Home Office under Unreimbursed Employee Expenses, earlier, and Publication 587. 2012 irs tax return forms Investment-Related Seminars You cannot deduct any expenses for attending a convention, seminar, or similar meeting for investment purposes. 2012 irs tax return forms Life Insurance Premiums You cannot deduct premiums you pay on your life insurance. 2012 irs tax return forms You may be able to deduct, as alimony, premiums you pay on life insurance policies assigned to your former spouse. 2012 irs tax return forms See Publication 504, Divorced or Separated Individuals, for information on alimony. 2012 irs tax return forms Lobbying Expenses You generally cannot deduct amounts paid or incurred for lobbying expenses. 2012 irs tax return forms These include expenses to: Influence legislation, Participate, or intervene, in any political campaign for, or against, any candidate for public office, Attempt to influence the general public, or segments of the public, about elections, legislative matters, or referendums, or Communicate directly with covered executive branch officials in any attempt to influence the official actions or positions of those officials. 2012 irs tax return forms Lobbying expenses also include any amounts paid or incurred for research, preparation, planning, or coordination of any of these activities. 2012 irs tax return forms Covered executive branch official. 2012 irs tax return forms   A covered executive branch official, for the purpose of (4) above, is any of the following officials. 2012 irs tax return forms The President. 2012 irs tax return forms The Vice President. 2012 irs tax return forms Any officer or employee of the White House Office of the Executive Office of the President, and the two most senior level officers of each of the other agencies in the Executive Office. 2012 irs tax return forms Any individual serving in a position in Level I of the Executive Schedule under section 5312 of Title 5, United States Code, any other individual designated by the President as having Cabinet-level status, and any immediate deputy of one of these individuals. 2012 irs tax return forms Dues used for lobbying. 2012 irs tax return forms   If a tax-exempt organization notifies you that part of the dues or other amounts you pay to the organization are used to pay nondeductible lobbying expenses, you cannot deduct that part. 2012 irs tax return forms Exceptions. 2012 irs tax return forms   You can deduct certain lobbying expenses if they are ordinary and necessary expenses of carrying on your trade or business. 2012 irs tax return forms You can deduct expenses for attempting to influence the legislation of any local council or similar governing body (local legislation). 2012 irs tax return forms An Indian tribal government is considered a local council or similar governing body. 2012 irs tax return forms You can deduct in-house expenses for influencing legislation or communicating directly with a covered executive branch official if the expenses for the tax year are not more than $2,000 (not counting overhead expenses). 2012 irs tax return forms If you are a professional lobbyist, you can deduct the expenses you incur in the trade or business of lobbying on behalf of another person. 2012 irs tax return forms Payments by the other person to you for lobbying activities cannot be deducted. 2012 irs tax return forms Lost or Mislaid Cash or Property You cannot deduct a loss based on the mere disappearance of money or property. 2012 irs tax return forms However, an accidental loss or disappearance of property can qualify as a casualty if it results from an identifiable event that is sudden, unexpected, or unusual. 2012 irs tax return forms See Publication 547. 2012 irs tax return forms Example. 2012 irs tax return forms A car door is accidentally slammed on your hand, breaking the setting of your diamond ring. 2012 irs tax return forms The diamond falls from the ring and is never found. 2012 irs tax return forms The loss of the diamond is a casualty. 2012 irs tax return forms Lunches With Co-workers You cannot deduct the expenses of lunches with co-workers, except while traveling away from home on business. 2012 irs tax return forms See Publication 463 for information on deductible expenses while traveling away from home. 2012 irs tax return forms Meals While Working Late You cannot deduct the cost of meals while working late. 2012 irs tax return forms However, you may be able to claim a deduction if the cost of the meals is a deductible entertainment expense, or if you are traveling away from home. 2012 irs tax return forms See Publication 463 for information on deductible entertainment expenses and expenses while traveling away from home. 2012 irs tax return forms Personal Legal Expenses You cannot deduct personal legal expenses such as those for the following. 2012 irs tax return forms Custody of children. 2012 irs tax return forms Breach of promise to marry suit. 2012 irs tax return forms Civil or criminal charges resulting from a personal relationship. 2012 irs tax return forms Damages for personal injury (except certain whistleblower claims and unlawful discrimination claims). 2012 irs tax return forms For more information about unlawful discrimination claims, see Deductions Subject to the 2% Limit, earlier. 2012 irs tax return forms Preparation of a title (or defense or perfection of a title). 2012 irs tax return forms Preparation of a will. 2012 irs tax return forms Property claims or property settlement in a divorce. 2012 irs tax return forms You cannot deduct these expenses even if a result of the legal proceeding is the loss of income-producing property. 2012 irs tax return forms Political Contributions You cannot deduct contributions made to a political candidate, a campaign committee, or a newsletter fund. 2012 irs tax return forms Advertisements in convention bulletins and admissions to dinners or programs that benefit a political party or political candidate are not deductible. 2012 irs tax return forms Professional Accreditation Fees You cannot deduct professional accreditation fees such as the following. 2012 irs tax return forms Accounting certificate fees paid for the initial right to practice accounting. 2012 irs tax return forms Bar exam fees and incidental expenses in securing initial admission to the bar. 2012 irs tax return forms Medical and dental license fees paid to get initial licensing. 2012 irs tax return forms Professional Reputation You cannot deduct expenses of radio and TV appearances to increase your personal prestige or establish your professional reputation. 2012 irs tax return forms Relief Fund Contributions You cannot deduct contributions paid to a private plan that pays benefits to any covered employee who cannot work because of any injury or illness not related to the job. 2012 irs tax return forms Residential Telephone Service You cannot deduct any charge (including taxes) for basic local telephone service for the first telephone line to your residence, even if it is used in a trade or business. 2012 irs tax return forms Stockholders' Meetings You cannot deduct transportation and other expenses you pay to attend stockholders' meetings of companies in which you own stock but have no other interest. 2012 irs tax return forms You cannot deduct these expenses even if you are attending the meeting to get information that would be useful in making further investments. 2012 irs tax return forms Tax-Exempt Income Expenses You cannot deduct expenses to produce tax-exempt income. 2012 irs tax return forms You cannot deduct interest on a debt incurred or continued to buy or carry tax-exempt securities. 2012 irs tax return forms If you have expenses to p