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2012 Tax Forms Irs

2012 tax forms irs Publication 530 - Introductory Material Table of Contents What's New Reminders IntroductionOrdering forms and publications. 2012 tax forms irs Tax questions. 2012 tax forms irs Useful Items - You may want to see: What's New Simplified method for business use of home deduction. 2012 tax forms irs  The IRS now provides a simplified method to determine your expenses for business use of your home. 2012 tax forms irs For more information, see the Instructions for Schedule C (Form 1040). 2012 tax forms irs Reminders Future developments. 2012 tax forms irs  For the latest information about developments related to Publication 530, such as legislation enacted after it was published, go to www. 2012 tax forms irs irs. 2012 tax forms irs gov/pub530. 2012 tax forms irs Residential energy credits. 2012 tax forms irs  You may be able to take a credit if you made energy saving improvements to your home located in the United States in 2013. 2012 tax forms irs See Form 5695, Residential Energy Credits, for more information. 2012 tax forms irs Home Affordable Modification Program (HAMP). 2012 tax forms irs  If you benefit from Pay-for-Performance Success Payments, the payments are not taxable under HAMP. 2012 tax forms irs Hardest Hit Fund and Emergency Homeowners' Loan Programs. 2012 tax forms irs  If you are a homeowner who received assistance under a State Housing Finance Agency Hardest Hit Fund program or an Emergency Homeowners' Loan Program, you may be able to deduct all of the payments you made on your mortgage during the year. 2012 tax forms irs For details, see Hardest Hit Fund and Emergency Homeowners' Loan Programs under What You Can and Cannot Deduct, later. 2012 tax forms irs Mortgage debt forgiveness. 2012 tax forms irs  You can exclude from gross income any discharges of qualified principal residence indebtedness made after 2006 and before 2014. 2012 tax forms irs You must reduce the basis of your principal residence (but not below zero) by the amount you exclude. 2012 tax forms irs See Discharges of qualified principal residence indebtedness , later, and Form 982, Reduction of Tax Attributes Due to Discharge of Indebtedness (and Section 1082 Basis Adjustment), for more information. 2012 tax forms irs Repayment of first-time homebuyer credit. 2012 tax forms irs  Generally, you must repay any credit you claimed for a home you bought if you disposed of the home or it ceased to be your main home in 2013. 2012 tax forms irs If you bought the home in 2008 and you owned and used it as your main home for all of 2013, you generally must continue repaying the credit with your 2013 tax return, but you do not have to attach Form 5405, Repayment of the First-Time Homebuyer Credit. 2012 tax forms irs See Form 5405 and its instructions for details and for exceptions to the repayment rule. 2012 tax forms irs Photographs of missing children. 2012 tax forms irs  The Internal Revenue Service is a proud partner with the National Center for Missing and Exploited Children. 2012 tax forms irs Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. 2012 tax forms irs You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child. 2012 tax forms irs Introduction This publication provides tax information for homeowners. 2012 tax forms irs Your home may be a house, condominium, cooperative apartment, mobile home, houseboat, or house trailer that contains sleeping space and toilet and cooking facilities. 2012 tax forms irs The following topics are explained. 2012 tax forms irs How you treat items such as settlement and closing costs, real estate taxes, sales taxes, home mortgage interest, and repairs. 2012 tax forms irs What you can and cannot deduct on your tax return. 2012 tax forms irs The tax credit you can claim if you received a mortgage credit certificate when you bought your home. 2012 tax forms irs Why you should keep track of adjustments to the basis of your home. 2012 tax forms irs (Your home's basis generally is what it cost; adjustments include the cost of any improvements you might make. 2012 tax forms irs ) What records you should keep as proof of the basis and adjusted basis. 2012 tax forms irs Comments and suggestions. 2012 tax forms irs   We welcome your comments about this publication and your suggestions for future editions. 2012 tax forms irs   You can write to us at the following address: Internal Revenue Service Tax Forms and Publications Division 1111 Constitution Ave. 2012 tax forms irs NW, IR-6526 Washington, DC 20224   We respond to many letters by telephone. 2012 tax forms irs Therefore, it would be helpful if you would include your daytime phone number, including the area code, in your correspondence. 2012 tax forms irs   You can send your comments from www. 2012 tax forms irs irs. 2012 tax forms irs gov/formspubs/. 2012 tax forms irs Click on “More Information” and then on “Comment on Tax Forms and Publications”. 2012 tax forms irs   Although we cannot respond individually to each comment received, we do appreciate your feedback and will consider your comments as we revise our tax products. 2012 tax forms irs Ordering forms and publications. 2012 tax forms irs   Visit www. 2012 tax forms irs irs. 2012 tax forms irs gov/formspubs/ to download forms and publications, call 1-800-TAX-FORM (1-800-829-3676), or write to the address below and receive a response within 10 days after your request is received. 2012 tax forms irs Internal Revenue Service 1201 N. 2012 tax forms irs Mitsubishi Motorway Bloomington, IL 61705-6613 Tax questions. 2012 tax forms irs   If you have a tax question, check the information available on IRS. 2012 tax forms irs gov or call 1-800-829-1040. 2012 tax forms irs We cannot answer tax questions sent to either of the above addresses. 2012 tax forms irs Useful Items - You may want to see: Publication 523 Selling Your Home 527 Residential Rental Property 547 Casualties, Disasters, and Thefts 551 Basis of Assets 555 Community Property 587 Business Use of Your Home 936 Home Mortgage Interest Deduction Form (and Instructions) 5405 Repayment of the First-Time Homebuyer Credit 5695 Residential Energy Credits 8396 Mortgage Interest Credit See How To Get Tax Help , near the end of this publication, for information about getting publications and forms. 2012 tax forms irs Prev  Up  Next   Home   More Online Publications
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Answers to Frequently Asked Questions for Registered Domestic Partners and Individuals in Civil Unions

The following questions and answers provide information to individuals of the same sex and opposite sex who are in registered domestic partnerships, civil unions or other similar formal relationships that are not marriages under state law. These individuals are not considered as married or spouses for federal tax purposes. For convenience, these individuals are referred to as “registered domestic partners” in these questions and answers. Questions and answers 9 through 27 concern registered domestic partners who reside in community property states and who are subject to their state’s community property laws. These questions and answers have been updated since the Supreme Court issued its decision in United States v. Windsor. As a result of the Court’s decision, the Service has ruled that same-sex couples who are married under state law are married for federal tax purposes. See Revenue Ruling 2013-17 in 2013‑38 IRB 201.

Q1. Can registered domestic partners file federal tax returns using a married filing jointly or married filing separately status?

A1. No. Registered domestic partners may not file a federal return using a married filing separately or jointly filing status. Registered domestic partners are not married under state law. Therefore, these taxpayers are not married for federal tax purposes.

Q2. Can a taxpayer use the head-of-household filing status if the taxpayer’s only dependent is his or her registered domestic partner?

A2. No. A taxpayer cannot file as head of household if the taxpayer’s only dependent is his or her registered domestic partner. A taxpayer’s registered domestic partner is not one of the specified related individuals in section 152(c) or (d) that qualifies the taxpayer to file as head of household, even if the registered domestic partner is the taxpayer’s dependent.

Q3. If registered domestic partners have a child, which parent may claim the child as a dependent?

A3. If a child is a qualifying child under section 152(c) of both parents who are registered domestic partners, either parent, but not both, may claim a dependency deduction for the qualifying child. If both parents claim a dependency deduction for the child on their income tax returns, the IRS will treat the child as the qualifying child of the parent with whom the child resides for the longer period of time during the taxable year. If the child resides with each parent for the same amount of time during the taxable year, the IRS will treat the child as the qualifying child of the parent with the higher adjusted gross income.

Q4. Can a registered domestic partner itemize deductions if his or her partner claims a standard deduction? 

A4. Yes. A registered domestic partner may itemize or claim the standard deduction regardless of whether his or her partner itemizes or claims the standard deduction. Although the law prohibits a taxpayer from itemizing deductions if the taxpayer’s spouse claims the standard deduction (section 63(c)(6)(A)), this provision does not apply to registered domestic partners, because registered domestic partners are not spouses for federal tax purposes.

Q5. If registered domestic partners adopt a child together, can one or both of the registered domestic partners qualify for the adoption credit?

A5. Yes. Each registered domestic partner may qualify to claim the adoption credit for the amount of the qualified adoption expenses paid for the adoption. The partners may not both claim a credit for the same qualified adoption expenses, and the sum of the credit taken by each registered domestic partner may not exceed the total amount paid. The adoption credit is limited to $12,970 per child in 2013. Thus, if both registered domestic partners paid qualified adoption expenses to adopt the same child, and the total of those expenses exceeds $12,970, the maximum credit available for the adoption is $12,970. The registered domestic partners may allocate this maximum between them in any way they agree, and the amount of credit claimed by one registered domestic partner can exceed the adoption expenses paid by that person, as long as the total credit claimed by both registered domestic partners does not exceed the total amount paid by them. The same rules generally apply in the case of a special needs adoption. 

Q6. If a taxpayer adopts the child of his or her registered domestic partner as a second parent or co-parent, may the taxpayer (“adopting parent”) claim the adoption credit for the qualifying adoption expenses he or she pays to adopt the child?

A6. Yes. The adopting parent may be eligible to claim an adoption credit. A taxpayer may not claim an adoption credit for the expenses of adopting the child of the taxpayer’s spouse (section 23) .  However, this limitation does not apply to adoptions by registered domestic partners because registered domestic partners are not spouses for federal tax purposes.

Q7. Do provisions of the federal tax law such as section 66 (treatment of community income) and section 469(i)(5) ($25,000 offset for passive activity losses for rental real estate activities) that apply to married taxpayers apply to registered domestic partners?

A7. No. Like other provisions of the federal tax law that apply only to married taxpayers, section 66 and section 469(i)(5) do not apply to registered domestic partners because registered domestic partners are not married for federal tax purposes.

Q8. Is a registered domestic partner the stepparent of his or her partner’s child?

A8. If a registered domestic partner is the stepparent of his or her partner’s child under state law, the registered domestic partner is the stepparent of the child for federal income tax purposes.


Publication 555, Community Property, provides general information for taxpayers, including registered domestic partners, who reside in community property states. The following questions and answers provide additional information to registered domestic partners (including same-sex and opposite-sex registered domestic partners) who reside in community property states and are subject to community property laws.

Q9. How do registered domestic partners determine their gross income?

A9. Registered domestic partners must each report half the combined community income earned by the partners.  In addition to half of the community income, a partner who has income that is not community income must report that separate income. 

Q10.  Can a registered domestic partner qualify to file his or her tax return using head-of-household filing status?

A10. Generally, to qualify as a head-of-household, a taxpayer must provide more than half the cost of maintaining his or her household during the taxable year, and that household must be the principal place of abode of the taxpayer’s dependent for more than half of the taxable year (section 2(b)). If registered domestic partners pay all of the costs of maintaining the household from community funds, each partner is considered to have incurred half the cost and neither can qualify as head of household. Even if one of the partners pays more than half by contributing separate funds, that partner cannot file as head of household if the only dependent is his or her registered domestic partner. A taxpayer’s registered domestic partner is not one of the specified related individuals in section 152(c) or (d) that qualifies the taxpayer to file as head of household, even if the partner is the taxpayer’s dependent.    

Q11. Can a registered domestic partner be a dependent of his or her partner for purposes of the dependency deduction under section 151?

A11. A registered domestic partner can be a dependent of his or her partner if the requirements of sections 151 and 152 are met. However, it is unlikely that registered domestic partners will satisfy the gross income requirement of section 152(d)(1)(B) and the support requirement of section 152(d)(1)(C). To satisfy the gross income requirement, the gross income of the individual claimed as a dependent must be less than the exemption amount ($3,900 for 2013). Because registered domestic partners each report half the combined community income earned by both partners, it is unlikely that a registered domestic partner will have gross income that is less than the exemption amount.   

To satisfy the support requirement, more than half of an individual’s support for the year must be provided by the person seeking the dependency deduction. If a registered domestic partner’s (Partner A’s) support comes entirely from community funds, that partner is considered to have provided half of his or her own support and cannot be claimed as a dependent by another. However, if the other registered domestic partner (Partner B) pays more than half of the support of Partner A by contributing separate funds, Partner A may be a dependent of Partner B for purposes of section 151, provided the other requirements of sections 151 and 152 are satisfied. 

Q12. Can a registered domestic partner be a dependent of his or her partner for purposes of the exclusion in section 105(b) for reimbursements of expenses for medical care?

A12. A registered domestic partner (Partner A) may be a dependent of his or her partner (Partner B) for purposes of the exclusion in section 105(b) only if the support requirement (discussed in Question 11, above) is satisfied. Unlike the requirements for section 152(d) (dependency deduction for a qualifying relative), section 105(b) does not require that Partner A's gross income be less than the exemption amount in order for Partner A to qualify as a dependent.                   

Q13. How should registered domestic partners report wages, other income items, and deductions on their federal income tax returns?

A13. Registered domestic partners should report wages, other income items, and deductions according to the instructions to Form 1040, U.S. Individual Income Tax Return, and related schedules, and Form 8958, Allocation of Tax Amounts Between Certain Individuals in Community Property States. Form 8958 is used to determine the allocation of tax amounts between registered domestic partners. Each partner must complete and attach Form 8958 to his or her Form 1040.

Q14. Should registered domestic partners report social security benefits as community income for federal tax purposes? 

A14. Generally, state law determines whether an item of income constitutes community income. Accordingly, if Social Security benefits are community income under state law, then they are also community income for federal income tax purposes. If Social Security benefits are not community income under state law, then they are not community income for federal income tax purposes. 

Q15. How should registered domestic partners report community income from a business on Schedule C, Profit or Loss From Business?

A15. Half of the income, deductions, and net earnings of a business operated by a registered domestic partner must be reported by each registered domestic partner on a Schedule C (or Schedule C-EZ). In addition, each registered domestic partner owes self-employment tax on half of the net earnings of the business. The self-employment tax rule under section 1402(a)(5) that overrides community income treatment and attributes the income, deductions, and net earnings to the spouse who carries on the trade or business does not apply to registered domestic partners.

Q16.  Are registered domestic partners each entitled to half of the credits for income tax withholding from the combined wages of the registered domestic partners?

A16. Yes. Because each registered domestic partner is taxed on half the combined community income earned by the partners, each is entitled to a credit for half of the income tax withheld on the combined wages.

Q17.  Are registered domestic partners each entitled to take credit for half of the total estimated tax payments paid by the partners?

A17. No. Unlike withholding credits, which are allowed to the person who is taxed on the income from which the tax is withheld, a registered domestic partner can take credit only for the estimated tax payments that he or she made.       

Q18. Are community property laws taken into account in determining earned income for purposes of the dependent care credit, the refundable portion of the child tax credit, the earned income credit, and the making work pay credit?   

A18. No. The federal tax laws governing these credits specifically provide that earned income is computed without regard to community property laws in determining the earned income amounts described in section 21(d) (dependent care credit), section 24(d) (the refundable portion of the child tax credit), section 32(a) (earned income credit), and section 36A(d) (making work pay credit).

Q19. Are community property laws taken into account in determining adjusted gross income (or modified adjusted gross income) for purposes of the dependent care credit, the child tax credit, the earned income credit, and the making work pay credit?

A19. Yes. Community property laws must be taken into account in determining the adjusted gross income (or modified adjusted gross income) amounts in section 21(a) (dependent care credit), section 24(b) (child tax credit), section 32(a) (earned income credit), and section 36A(b) (making work pay credit).

Q20. Are amounts a registered domestic partner receives for education expenses that cannot be excluded from the partner’s gross income (includible education benefits) considered to be community income? 

A20. Generally, state law determines whether an item of income constitutes community income. Accordingly, whether includible education benefits are community income for federal income tax purposes depends on whether they are community income under state law. If the includible education benefits are community income under state law, then they are community income for federal income tax purposes. If not community income under state law, they are not community income for federal income tax purposes. 

Q21. If only one registered domestic partner is a teacher and pays qualified out-of-pocket educator expenses from community funds, do the registered domestic partners split the educator expense deduction?

A21. No. Section 62(a)(2)(D) allows only eligible educators to take a deduction for qualified out-of-pocket educator expenses. If only one registered domestic partner is an eligible educator (the eligible partner), then only the eligible partner may claim a section 62(a)(2)(D) deduction. If the eligible partner uses community funds to pay educator expenses, the eligible partner may determine the deduction as if he or she made the entire expenditure. In that case, the eligible partner has received a gift from his or her partner equal to one-half of the expenditure.  

Q22. If a registered domestic partner incurs indebtedness for his or her qualified education expenses or the expenses of a dependent and pays interest on the indebtedness out of community funds, do the registered domestic partners split the interest deduction?

A22. No. To be a qualified education loan, the indebtedness must be incurred by a taxpayer to pay the qualified education expenses of the taxpayer, the taxpayer’s spouse, or a dependent of the taxpayer (section 221(d)(1)). Thus, only the partner who incurs debt to pay his or her own education expenses or the expenses of a dependent may deduct interest on a qualified education loan (the student partner). If the student partner uses community funds to pay the interest on the qualified education loan, the student partner may determine the deduction as if he or she made the entire expenditure. In that case, the student partner has received a gift from his or her partner equal to one-half of the expenditure. 

Q23.  If registered domestic partners pay the qualified educational expenses of one of the partners or a dependent of one of the partners with community funds, do the registered domestic partners split the section 25A credits (education credits)?

A23. No. Only the partner who pays his or her own education expenses or the expenses of his or her dependent is eligible for an education credit (the student partner). If the student partner uses community funds to pay the education expenses, the student partner may determine the credit as if he or she made the entire expenditure. In that case, the student partner has received a gift from his or her partner equal to one-half of the expenditure. Similarly, if the student partner is allowed a deduction under section 222 (deduction for qualified tuition and related expenses), and uses community funds to pay the education expenses, the student partner may determine the qualified tuition expense deduction as if he or she made the entire expenditure. In that case, the student partner has received a gift from his or her partner equal to one-half of the expenditure.     

Q24. Are community property laws taken into account in determining compensation for purposes of the IRA deduction?

A24. No. The federal tax laws governing the IRA deduction (section 219(f)(2)) specifically provide that the maximum IRA deduction (under section 219(b)) is computed separately for each individual, and that these IRA deduction rules are applied without regard to any community property laws. Thus, each individual determines whether he or she is eligible for an IRA deduction by computing his or her individual compensation (determined without application of community property laws). 

Q25. If a registered domestic partner is self-employed and pays health insurance premiums for both partners out of community property funds, are both partners allowed a deduction under section 162(l) (deduction for self-employed health insurance)?

A25. If one of the registered domestic partners is a self-employed individual treated as an employee within the meaning of section 401(c)(1)(the employee partner) and the other partner is not (the non-employee partner), the employee partner may be allowed a deduction under section 162(l) for the cost of the employee partner’s health insurance paid out of community funds. If the non-employee partner is also covered by the health insurance, the portion of the cost attributable to the non-employee partner’s coverage is not deductible by either the employee partner or the non-employee partner under section 162(l).  

Q26. If a registered domestic partner has a dependent and incurs employment-related expenses that are paid out of community funds, how does the registered domestic partner calculate the dependent care credit?  How about the child tax credit?

A26. If a registered domestic partner has a qualifying individual as defined in section 21(b)(1) and incurs employment-related expenses as defined in section 21(b)(2) for the care of the qualifying individual that are paid with community funds, the partner (employee partner) may determine the dependent care credit as if he or she made the entire expenditure. In that case, the employee partner has received a gift from his or her partner equal to one-half of the expenditure. In computing the dependent care credit, the following rules apply:

  • The employee partner must reduce the employment-related expenses by any amounts he or she excludes from income under section 129 (exclusion for employees for dependent care assistance furnished pursuant to a program described in section 129(d));
  • The earned income limitation described in section 21(d) is determined without regard to community property laws; and
  • The adjusted gross income of the employee partner is determined by taking into account community property laws.

A child tax credit is allowed for each qualifying child of a taxpayer for whom the taxpayer is allowed a personal exemption deduction. Thus, if a registered domestic partner has one or more dependents who is a qualifying child, the registered domestic partner may be allowed a child tax credit for each qualifying child. In determining the amount of the allowable credit, the modified adjusted gross income of the registered domestic partner with the qualifying child is determined by taking into account community property laws. Community property laws are ignored, however, in determining the refundable portion of the child tax credit.

Q27. Does Rev. Proc. 2002-69, 2002-2 C.B. 831, apply to registered domestic partners?

A27. No. Rev. Proc. 2002-69 allows spouses to classify certain entities solely owned by the spouses as community property, as either a disregarded entity or a partnership for federal tax purposes. Rev. Proc. 2002-69 applies only to spouses. Because registered domestic partners are not spouses for federal tax purposes, Rev. Proc. 2002-69 does not apply to registered domestic partners.

Related Item: Forms and Publications

Page Last Reviewed or Updated: 19-Sep-2013

The 2012 Tax Forms Irs

2012 tax forms irs 1. 2012 tax forms irs   Importance of Records Table of Contents Introduction Topics - This chapter discusses: Useful Items - You may want to see: Benefits of Recordkeeping Kinds of Records To Keep How Long To Keep Records Introduction A farmer, like other taxpayers, must keep records to prepare an accurate income tax return and determine the correct amount of tax. 2012 tax forms irs This chapter explains the benefits of keeping records, what kinds of records you must keep, and how long you must keep them for federal tax purposes. 2012 tax forms irs Tax records are not the only type of records you need to keep for your farming business. 2012 tax forms irs You should also keep records that measure your farm's financial performance. 2012 tax forms irs This publication only discusses tax records. 2012 tax forms irs The Farm Financial Standards Council has produced a publication that provides a detailed explanation of the recommendations of the Council for financial reporting and analysis. 2012 tax forms irs For information on recordkeeping, you can purchase and download Financial Guidelines for Agricultural Producers at www. 2012 tax forms irs ffsc. 2012 tax forms irs org. 2012 tax forms irs For more information, contact Countryside Marketing, Inc. 2012 tax forms irs in the following manner. 2012 tax forms irs Call 262-253-6902. 2012 tax forms irs Send a fax to 262-253-6903. 2012 tax forms irs Write to: Farm Financial Standards Council N78 W14573 Appleton Ave. 2012 tax forms irs , #287 Menomonee Falls, WI 53051. 2012 tax forms irs Topics - This chapter discusses: Benefits of recordkeeping Kinds of records to keep How long to keep records Useful Items - You may want to see: Publication 51 (Circular A), Agricultural Employer's Tax Guide 463 Travel, Entertainment, Gift, and Car Expenses See chapter 16 for information about getting publications. 2012 tax forms irs Benefits of Recordkeeping Everyone in business, including farmers, must keep appropriate records. 2012 tax forms irs Recordkeeping will help you do the following. 2012 tax forms irs Monitor the progress of your farming business. 2012 tax forms irs   You need records to monitor the progress of your farming business. 2012 tax forms irs Records can show whether your business is improving, which items are selling, or what changes you need to make. 2012 tax forms irs Records can help you make better decisions that may increase the likelihood of business success. 2012 tax forms irs Prepare your financial statements. 2012 tax forms irs   You need records to prepare accurate financial statements. 2012 tax forms irs These include income (profit and loss) statements and balance sheets. 2012 tax forms irs These statements can help you in dealing with your bank or creditors and help you to manage your farm business. 2012 tax forms irs Identify source of receipts. 2012 tax forms irs   You will receive money or property from many sources. 2012 tax forms irs Your records can identify the source of your receipts. 2012 tax forms irs You need this information to separate farm from nonfarm receipts and taxable from nontaxable income. 2012 tax forms irs Keep track of deductible expenses. 2012 tax forms irs   You may forget expenses when you prepare your tax return unless you record them when they occur. 2012 tax forms irs Prepare your tax returns. 2012 tax forms irs   You need records to prepare your tax return. 2012 tax forms irs For example, your records must support the income, expenses, and credits you report. 2012 tax forms irs Generally, these are the same records you use to monitor your farming business and prepare your financial statements. 2012 tax forms irs Support items reported on tax returns. 2012 tax forms irs   You must keep your business records available at all times for inspection by the IRS. 2012 tax forms irs If the IRS examines any of your tax returns, you may be asked to explain the items reported. 2012 tax forms irs A complete set of records will speed up the examination. 2012 tax forms irs Kinds of Records To Keep Except in a few cases, the law does not require any specific kind of records. 2012 tax forms irs You can choose any recordkeeping system suited to your farming business that clearly shows, for example, your income and expenses. 2012 tax forms irs You should set up your recordkeeping system using an accounting method that clearly shows your income for your tax year. 2012 tax forms irs See  chapter 2. 2012 tax forms irs If you are in more than one business, you should keep a complete and separate set of records for each business. 2012 tax forms irs A corporation should keep minutes of board of directors' meetings. 2012 tax forms irs Your recordkeeping system should include a summary of your business transactions. 2012 tax forms irs This summary is ordinarily made in accounting journals and ledgers. 2012 tax forms irs For example, they must show your gross income, as well as your deductions and credits. 2012 tax forms irs In addition, you must keep supporting documents. 2012 tax forms irs Purchases, sales, payroll, and other transactions you have in your business generate supporting documents such as invoices and receipts. 2012 tax forms irs These documents contain the information you need to record in your journals and ledgers. 2012 tax forms irs It is important to keep these documents because they support the entries in your journals and ledgers and on your tax return. 2012 tax forms irs Keep them in an orderly fashion and in a safe place. 2012 tax forms irs For instance, organize them by year and type of income or expense. 2012 tax forms irs Electronic records. 2012 tax forms irs   All requirements that apply to hard copy books and records also apply to electronic storage systems that maintain tax books and records. 2012 tax forms irs When you replace hard copy books and records, you must maintain the electronic storage systems for as long as they are material to the administration of tax law. 2012 tax forms irs An electronic storage system is any system for preparing or keeping your records either by electronic imaging or by transfer to an electronic storage media. 2012 tax forms irs The electronic storage system must index, store, preserve, retrieve and reproduce the electronically stored books and records in legible format. 2012 tax forms irs All electronic storage systems must provide a complete and accurate record of your data that is accessible to the IRS. 2012 tax forms irs Electronic storage systems are also subject to the same controls and retention guidelines as those imposed on your original hard copy books and records. 2012 tax forms irs The original hard copy books and records may be destroyed provided that the electronic storage system has been tested to establish that the hard copy books and records are being reproduced in compliance with IRS requirements for an electronic storage system and procedures are established to ensure continued compliance with all applicable rules and regulations. 2012 tax forms irs You still have the responsibility of retaining any other books and records that are required to be retained. 2012 tax forms irs The IRS may test your electronic storage system, including the equipment used, indexing methodology, software and retrieval capabilities. 2012 tax forms irs This test is not considered an examination and the results must be shared with you. 2012 tax forms irs If your electronic storage system meets the requirements mentioned earlier, you will be in compliance. 2012 tax forms irs If not, you may be subject to penalties for non-compliance, unless you continue to maintain your original hard copybooks and records in a manner that allows you and the IRS to determine your correct tax. 2012 tax forms irs For details on electronic storage system requirements, see Rev. 2012 tax forms irs Proc. 2012 tax forms irs 97-22. 2012 tax forms irs You can find Rev. 2012 tax forms irs Proc. 2012 tax forms irs 97-22 on page 9 of Internal Revenue Bulletin 1997-13 at  www. 2012 tax forms irs irs. 2012 tax forms irs gov/pub/irs-irbs/irb97-13. 2012 tax forms irs pdf. 2012 tax forms irs Travel, transportation, entertainment, and gift expenses. 2012 tax forms irs   Specific recordkeeping rules apply to these expenses. 2012 tax forms irs For more information, see Publication 463. 2012 tax forms irs Employment taxes. 2012 tax forms irs   There are specific employment tax records you must keep. 2012 tax forms irs For a list, see Publication 51 (Circular A). 2012 tax forms irs Excise taxes. 2012 tax forms irs   See How To Claim a Credit or Refund in chapter 14 for the specific records you must keep to verify your claim for credit or refund of excise taxes on certain fuels. 2012 tax forms irs Assets. 2012 tax forms irs   Assets are the property, such as machinery and equipment, you own and use in your business. 2012 tax forms irs You must keep records to verify certain information about your business assets. 2012 tax forms irs You need records to figure your annual depreciation deduction and the gain or (loss) when you sell the assets. 2012 tax forms irs Your records should show all the following. 2012 tax forms irs When and how you acquired the asset. 2012 tax forms irs Purchase price. 2012 tax forms irs Cost of any improvements. 2012 tax forms irs Section 179 deduction taken. 2012 tax forms irs Deductions taken for depreciation. 2012 tax forms irs Deductions taken for casualty losses, such as losses resulting from fires or storms. 2012 tax forms irs How you used the asset. 2012 tax forms irs When and how you disposed of the asset. 2012 tax forms irs Selling price. 2012 tax forms irs Expenses of sale. 2012 tax forms irs   The following are examples of records that may show this information. 2012 tax forms irs Purchase and sales invoices. 2012 tax forms irs Real estate closing statements. 2012 tax forms irs Canceled checks. 2012 tax forms irs Bank statements. 2012 tax forms irs Financial account statements as proof of payment. 2012 tax forms irs   If you do not have a canceled check, you may be able to prove payment with certain financial account statements prepared by financial institutions. 2012 tax forms irs These include account statements prepared for the financial institution by a third party. 2012 tax forms irs These account statements must be legible. 2012 tax forms irs The following table lists acceptable account statements. 2012 tax forms irs IF payment is by. 2012 tax forms irs . 2012 tax forms irs . 2012 tax forms irs THEN the statement must show the. 2012 tax forms irs . 2012 tax forms irs . 2012 tax forms irs Check Check number. 2012 tax forms irs Amount. 2012 tax forms irs Payee's name. 2012 tax forms irs Date the check amount was posted to the account by the financial institution. 2012 tax forms irs Electronic funds  transfer Amount transferred. 2012 tax forms irs Payee's name. 2012 tax forms irs Date the transfer was posted to the account by the financial institution. 2012 tax forms irs Credit card Amount charged. 2012 tax forms irs Payee's name. 2012 tax forms irs Transaction date. 2012 tax forms irs    Proof of payment of an amount, by itself, does not establish you are entitled to a tax deduction. 2012 tax forms irs You should also keep other documents, such as credit card sales slips and invoices, to show that you also incurred the cost. 2012 tax forms irs Tax returns. 2012 tax forms irs   Keep copies of your filed tax returns. 2012 tax forms irs They help in preparing future tax returns and making computations if you file an amended return. 2012 tax forms irs Keep copies of your information returns such as Form 1099, Schedule K-1, and Form W-2. 2012 tax forms irs How Long To Keep Records You must keep your records as long as they may be needed for the administration of any provision of the Internal Revenue Code. 2012 tax forms irs Keep records that support an item of income or a deduction appearing on a return until the period of limitations for the return runs out. 2012 tax forms irs A period of limitations is the period of time after which no legal action can be brought. 2012 tax forms irs Generally, that means you must keep your records for at least 3 years from when your tax return was due or filed or within 2 years of the date the tax was paid, whichever is later. 2012 tax forms irs However, certain records must be kept for a longer period of time, as discussed below. 2012 tax forms irs Employment taxes. 2012 tax forms irs   If you have employees, you must keep all employment tax records for at least 4 years after the date the tax becomes due or is paid, whichever is later. 2012 tax forms irs Assets. 2012 tax forms irs   Keep records relating to property until the period of limitations expires for the year in which you dispose of the property in a taxable disposition. 2012 tax forms irs You must keep these records to figure any depreciation, amortization, or depletion deduction and to figure your basis for computing gain or (loss) when you sell or otherwise dispose of the property. 2012 tax forms irs   You may need to keep records relating to the basis of property longer than the period of limitation. 2012 tax forms irs Keep those records as long as they are important in figuring the basis of the original or replacement property. 2012 tax forms irs Generally, this means as long as you own the property and, after you dispose of it, for the period of limitations that applies to you. 2012 tax forms irs For example, if you received property in a nontaxable exchange, you must keep the records for the old property, as well as for the new property, until the period of limitations expires for the year in which you dispose of the new property in a taxable disposition. 2012 tax forms irs For more information on basis, see chapter 6. 2012 tax forms irs Records for nontax purposes. 2012 tax forms irs   When your records are no longer needed for tax purposes, do not discard them until you check to see if you have to keep them longer for other purposes. 2012 tax forms irs For example, your insurance company or creditors may require you to keep them longer than the IRS does. 2012 tax forms irs Prev  Up  Next   Home   More Online Publications