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Amended 2009 Tax Return

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Amended 2009 Tax Return

Amended 2009 tax return 3. Amended 2009 tax return   Exclusions From Gross Income Table of Contents Introduction Topics - This chapter discusses: Useful Items - You may want to see: Resident AliensForeign Earned Income and Housing Amount Nonresident AliensInterest Income Dividend Income Services Performed for Foreign Employer Gambling Winnings From Dog or Horse Racing Gain From the Sale of Your Main Home Scholarships and Fellowship GrantsExpenses that do not qualify. Amended 2009 tax return Introduction Resident and nonresident aliens are allowed exclusions from gross income if they meet certain conditions. Amended 2009 tax return An exclusion from gross income is generally income you receive that is not included in your U. Amended 2009 tax return S. Amended 2009 tax return income and is not subject to U. Amended 2009 tax return S. Amended 2009 tax return tax. Amended 2009 tax return This chapter covers some of the more common exclusions allowed to resident and nonresident aliens. Amended 2009 tax return Topics - This chapter discusses: Nontaxable interest, Nontaxable dividends, Certain compensation paid by a foreign employer, Gain from sale of home, and Scholarships and fellowship grants. Amended 2009 tax return Useful Items - You may want to see: Publication 54 Tax Guide for U. Amended 2009 tax return S. Amended 2009 tax return Citizens and Resident Aliens Abroad 523 Selling Your Home See chapter 12 for information about getting these publications. Amended 2009 tax return Resident Aliens Resident aliens may be able to exclude the following items from their gross income. Amended 2009 tax return Foreign Earned Income and Housing Amount If you are physically present in a foreign country or countries for at least 330 full days during any period of 12 consecutive months, you may qualify for the foreign earned income exclusion. Amended 2009 tax return The exclusion is $97,600 in 2013. Amended 2009 tax return In addition, you may be able to exclude or deduct certain foreign housing amounts. Amended 2009 tax return You may also qualify if you are a bona fide resident of a foreign country and you are a citizen or national of a country with which the United States has an income tax treaty. Amended 2009 tax return For more information, see Publication 54. Amended 2009 tax return Foreign country. Amended 2009 tax return    A foreign country is any territory under the sovereignty of a government other than that of the United States. Amended 2009 tax return   The term “foreign country” includes the country's territorial waters and airspace, but not international waters and the airspace above them. Amended 2009 tax return It also includes the seabed and subsoil of those submarine areas adjacent to the country's territorial waters over which it has exclusive rights under international law to explore and exploit the natural resources. Amended 2009 tax return   The term “foreign country” does not include U. Amended 2009 tax return S. Amended 2009 tax return possessions or territories. Amended 2009 tax return It does not include the Antarctic region. Amended 2009 tax return Nonresident Aliens Nonresident aliens can exclude the following items from their gross income. Amended 2009 tax return Interest Income Interest income that is not connected with a U. Amended 2009 tax return S. Amended 2009 tax return trade or business is excluded from income if it is from: Deposits (including certificates of deposit) with persons in the banking business, Deposits or withdrawable accounts with mutual savings banks, cooperative banks, credit unions, domestic building and loan associations, and other savings institutions chartered and supervised as savings and loan or similar associations under federal or state law (if the interest paid or credited can be deducted by the association), and Amounts held by an insurance company under an agreement to pay interest on them. Amended 2009 tax return State and local government obligations. Amended 2009 tax return   Interest on obligations of a state or political subdivision, the District of Columbia, or a U. Amended 2009 tax return S. Amended 2009 tax return possession, generally is not included in income. Amended 2009 tax return However, interest on certain private activity bonds, arbitrage bonds, and certain bonds not in registered form is included in income. Amended 2009 tax return Portfolio interest. Amended 2009 tax return   Interest and original issue discount that qualifies as portfolio interest is not subject to NRA withholding. Amended 2009 tax return To qualify as portfolio interest, the interest must be paid on obligations issued after July 18, 1984, and otherwise subject to NRA withholding. Amended 2009 tax return Note. Amended 2009 tax return For obligations issued after March 18, 2012, portfolio interest does not include interest paid on debt that is not in registered form. Amended 2009 tax return Before March 19, 2012, portfolio interest included interest on certain registered and nonregistered (bearer) bonds if the obligations meet the requirements described below. Amended 2009 tax return Obligations in registered form. Amended 2009 tax return   Portfolio interest includes interest paid on an obligation that is in registered form, and for which you have received documentation that the beneficial owner of the obligation is not a United States person. Amended 2009 tax return   Generally, an obligation is in registered form if: (i) the obligation is registered as to both principal and any stated interest with the issuer (or its agent) and any transfer of the obligation may be effected only by surrender of the old obligation and reissuance to the new holder; (ii) the right to principal and stated interest with respect to the obligation may be transferred only through a book entry system maintained by the issuer or its agent; or (iii) the obligation is registered as to both principal and stated interest with the issuer or its agent and can be transferred both by surrender and reissuance and through a book entry system. Amended 2009 tax return   An obligation that would otherwise be considered to be in registered form is not considered to be in registered form as of a particular time if it can be converted at any time in the future into an obligation that is not in registered form. Amended 2009 tax return For more information on whether obligations are considered to be in registered form, see Portfolio interest in Publication 515. Amended 2009 tax return Obligations not in registered form. Amended 2009 tax return    For obligations issued before March 19, 2012, interest on an obligation that is not in registered form (bearer obligation) is portfolio interest if the obligation is foreign-targeted. Amended 2009 tax return A bearer obligation is foreign-targeted if: There are arrangements to ensure that the obligation will be sold, or resold in connection with the original issue, only to a person who is not a United States person, Interest on the obligation is payable only outside the United States and its possessions, and The face of the obligation contains a statement that any United States person who holds the obligation will be subject to limits under the United States income tax laws. Amended 2009 tax return   Documentation is not required for interest on bearer obligations to qualify as portfolio interest. Amended 2009 tax return In some cases, however, you may need documentation for purposes of Form 1099 reporting and backup withholding. Amended 2009 tax return Interest that does not qualify as portfolio interest. Amended 2009 tax return   Payments to certain persons and payments of contingent interest do not qualify as portfolio interest. Amended 2009 tax return You must withhold at the statutory rate on such payments unless some other exception, such as a treaty provision, applies. Amended 2009 tax return Contingent interest. Amended 2009 tax return   Portfolio interest does not include contingent interest. Amended 2009 tax return Contingent interest is either of the following: Interest that is determined by reference to: Any receipts, sales, or other cash flow of the debtor or related person, Income or profits of the debtor or related person, Any change in value of any property of the debtor or a related person, or Any dividend, partnership distributions, or similar payments made by the debtor or a related person. Amended 2009 tax return For exceptions, see Internal Revenue Code section 871(h)(4)(C). Amended 2009 tax return Any other type of contingent interest that is identified by the Secretary of the Treasury in regulations. Amended 2009 tax return Related persons. Amended 2009 tax return   Related persons include the following. Amended 2009 tax return Members of a family, including only brothers, sisters, half-brothers, half-sisters, spouse, ancestors (parents, grandparents, etc. Amended 2009 tax return ), and lineal descendants (children, grandchildren, etc. Amended 2009 tax return ). Amended 2009 tax return Any person who is a party to any arrangement undertaken for the purpose of avoiding the contingent interest rules. Amended 2009 tax return Certain corporations, partnerships, and other entities. Amended 2009 tax return For details, see Nondeductible Loss in chapter 2 of Publication 544. Amended 2009 tax return Exception for existing debt. Amended 2009 tax return   Contingent interest does not include interest paid or accrued on any debt with a fixed term that was issued: On or before April 7, 1993, or After April 7, 1993, pursuant to a written binding contract in effect on that date and at all times thereafter before that debt was issued. Amended 2009 tax return Dividend Income The following dividend income is exempt from the 30% tax. Amended 2009 tax return Certain dividends paid by foreign corporations. Amended 2009 tax return   There is no 30% tax on U. Amended 2009 tax return S. Amended 2009 tax return source dividends you receive from a foreign corporation. Amended 2009 tax return See Second exception under Dividends in chapter 2 for how to figure the amount of U. Amended 2009 tax return S. Amended 2009 tax return source dividends. Amended 2009 tax return Certain interest-related dividends. Amended 2009 tax return   There is no 30% tax on interest-related dividends from sources within the United States that you receive from a mutual fund or other regulated investment company in 2013. Amended 2009 tax return The mutual fund will designate in writing which dividends are interest-related dividends. Amended 2009 tax return Certain short-term capital gain dividends. Amended 2009 tax return   There may not be any 30% tax on certain short-term capital gain dividends from sources within the United States that you receive from a mutual fund or other regulated investment company. Amended 2009 tax return The mutual fund will designate in writing which dividends are short-term capital gain dividends. Amended 2009 tax return This tax relief will not apply to you if you are present in the United States for 183 days or more during your tax year. Amended 2009 tax return Services Performed for Foreign Employer If you were paid by a foreign employer, your U. Amended 2009 tax return S. Amended 2009 tax return source income may be exempt from U. Amended 2009 tax return S. Amended 2009 tax return tax, but only if you meet one of the situations discussed next. Amended 2009 tax return Employees of foreign persons, organizations, or offices. Amended 2009 tax return   Income for personal services performed in the United States as a nonresident alien is not considered to be from U. Amended 2009 tax return S. Amended 2009 tax return sources and is tax exempt if you meet all three of the following conditions. Amended 2009 tax return You perform personal services as an employee of or under a contract with a nonresident alien individual, foreign partnership, or foreign corporation, not engaged in a trade or business in the United States; or you work for an office or place of business maintained in a foreign country or possession of the United States by a U. Amended 2009 tax return S. Amended 2009 tax return corporation, a U. Amended 2009 tax return S. Amended 2009 tax return partnership, or a U. Amended 2009 tax return S. Amended 2009 tax return citizen or resident. Amended 2009 tax return You perform these services while you are a nonresident alien temporarily present in the United States for a period or periods of not more than a total of 90 days during the tax year. Amended 2009 tax return Your pay for these services is not more than $3,000. Amended 2009 tax return If you do not meet all three conditions, your income from personal services performed in the United States is U. Amended 2009 tax return S. Amended 2009 tax return source income and is taxed according to the rules in chapter 4. Amended 2009 tax return   If your pay for these services is more than $3,000, the entire amount is income from a trade or business within the United States. Amended 2009 tax return To find if your pay is more than $3,000, do not include any amounts you get from your employer for advances or reimbursements of business travel expenses, if you were required to and did account to your employer for those expenses. Amended 2009 tax return If the advances or reimbursements are more than your expenses, include the excess in your pay for these services. Amended 2009 tax return   A day means a calendar day during any part of which you are physically present in the United States. Amended 2009 tax return Example 1. Amended 2009 tax return During 2013, Henry Smythe, a nonresident alien from a nontreaty country, worked for an overseas office of a U. Amended 2009 tax return S. Amended 2009 tax return partnership. Amended 2009 tax return Henry, who uses the calendar year as his tax year, was temporarily present in the United States for 60 days during 2013 performing personal services for the overseas office of the partnership. Amended 2009 tax return That office paid him a total gross salary of $2,800 for those services. Amended 2009 tax return During 2013, he was not engaged in a trade or business in the United States. Amended 2009 tax return The salary is not considered U. Amended 2009 tax return S. Amended 2009 tax return source income and is exempt from U. Amended 2009 tax return S. Amended 2009 tax return tax. Amended 2009 tax return Example 2. Amended 2009 tax return The facts are the same as in Example 1, except that Henry's total gross salary for the services performed in the United States during 2013 was $4,500. Amended 2009 tax return He received $2,875 in 2013, and $1,625 in 2014. Amended 2009 tax return During 2013, he was engaged in a trade or business in the United States because the compensation for his personal services in the United States was more than $3,000. Amended 2009 tax return Henry's salary is U. Amended 2009 tax return S. Amended 2009 tax return source income and is taxed under the rules in chapter 4. Amended 2009 tax return Crew members. Amended 2009 tax return   Compensation for services performed by a nonresident alien in connection with the individual's temporary presence in the United States as a regular crew member of a foreign vessel (for example, a boat or ship) engaged in transportation between the United States and a foreign country or U. Amended 2009 tax return S. Amended 2009 tax return possession is not U. Amended 2009 tax return S. Amended 2009 tax return source income and is exempt from U. Amended 2009 tax return S. Amended 2009 tax return tax. Amended 2009 tax return This exemption does not apply to compensation for services performed on foreign aircraft. Amended 2009 tax return Students and exchange visitors. Amended 2009 tax return   Nonresident alien students and exchange visitors present in the United States under “F,” “J,” or “Q” visas can exclude from gross income pay received from a foreign employer. Amended 2009 tax return   This group includes bona fide students, scholars, trainees, teachers, professors, research assistants, specialists, or leaders in a field of specialized knowledge or skill, or persons of similar description. Amended 2009 tax return It also includes the alien's spouse and minor children if they come with the alien or come later to join the alien. Amended 2009 tax return   A nonresident alien temporarily present in the United States under a “J” visa includes an alien individual entering the United States as an exchange visitor under the Mutual Educational and Cultural Exchange Act of 1961. Amended 2009 tax return Foreign employer. Amended 2009 tax return   A foreign employer is: A nonresident alien individual, foreign partnership, or foreign corporation, or An office or place of business maintained in a foreign country or in a U. Amended 2009 tax return S. Amended 2009 tax return possession by a U. Amended 2009 tax return S. Amended 2009 tax return corporation, a U. Amended 2009 tax return S. Amended 2009 tax return partnership, or an individual who is a U. Amended 2009 tax return S. Amended 2009 tax return citizen or resident. Amended 2009 tax return   The term “foreign employer” does not include a foreign government. Amended 2009 tax return Pay from a foreign government that is exempt from U. Amended 2009 tax return S. Amended 2009 tax return income tax is discussed in chapter 10. Amended 2009 tax return Income from certain annuities. Amended 2009 tax return   Do not include in income any annuity received under a qualified annuity plan or from a qualified trust exempt from U. Amended 2009 tax return S. Amended 2009 tax return income tax if you meet both of the following conditions. Amended 2009 tax return You receive the annuity only because: You performed personal services outside the United States while you were a nonresident alien, or You performed personal services inside the United States while you were a nonresident alien and you met the three conditions, described earlier, under Employees of foreign persons, organizations, or offices . Amended 2009 tax return At the time the first amount is paid as an annuity under the plan (or by the trust), 90% or more of the employees for whom contributions or benefits are provided under the annuity plan (or under the plan of which the trust is a part) are U. Amended 2009 tax return S. Amended 2009 tax return citizens or residents. Amended 2009 tax return   If the annuity qualifies under condition (1) but not condition (2) above, you do not have to include the amount in income if: You are a resident of a country that gives a substantially equal exclusion to U. Amended 2009 tax return S. Amended 2009 tax return citizens and residents, or You are a resident of a beneficiary developing country under Title V of the Trade Act of 1974. Amended 2009 tax return   If you are not sure whether the annuity is from a qualified annuity plan or qualified trust, ask the person who made the payment. Amended 2009 tax return Income affected by treaties. Amended 2009 tax return   Income of any kind that is exempt from U. Amended 2009 tax return S. Amended 2009 tax return tax under a treaty to which the United States is a party is excluded from your gross income. Amended 2009 tax return Income on which the tax is only limited by treaty, however, is included in gross income. Amended 2009 tax return See chapter 9. Amended 2009 tax return Gambling Winnings From Dog or Horse Racing You can exclude from your gross income winnings from legal wagers initiated outside the United States in a parimutuel pool with respect to a live horse or dog race in the United States. Amended 2009 tax return Gain From the Sale of Your Main Home If you sold your main home, you may be able to exclude up to $250,000 of the gain on the sale of your home. Amended 2009 tax return If you are married and file a joint return, you may be able to exclude up to $500,000. Amended 2009 tax return For information on the requirements for this exclusion, see Publication 523. Amended 2009 tax return This exclusion does not apply to nonresident aliens who are subject to the expatriation tax rules discussed in chapter 4. Amended 2009 tax return Scholarships and Fellowship Grants If you are a candidate for a degree, you may be able to exclude from your income part or all of the amounts you receive as a qualified scholarship. Amended 2009 tax return The rules discussed here apply to both resident and nonresident aliens. Amended 2009 tax return If a nonresident alien receives a grant that is not from U. Amended 2009 tax return S. Amended 2009 tax return sources, it is not subject to U. Amended 2009 tax return S. Amended 2009 tax return tax. Amended 2009 tax return See Scholarships, Grants, Prizes, and Awards in chapter 2 to determine whether your grant is from U. Amended 2009 tax return S. Amended 2009 tax return sources. Amended 2009 tax return A scholarship or fellowship is excludable from income only if: You are a candidate for a degree at an eligible educational institution, and You use the scholarship or fellowship to pay qualified education expenses. Amended 2009 tax return Candidate for a degree. Amended 2009 tax return   You are a candidate for a degree if you: Attend a primary or secondary school or are pursuing a degree at a college or university, or Attend an accredited educational institution that is authorized to provide: A program that is acceptable for full credit toward a bachelor's or higher degree, or A program of training to prepare students for gainful employment in a recognized occupation. Amended 2009 tax return Eligible educational institution. Amended 2009 tax return   An eligible educational institution is one that maintains a regular faculty and curriculum and normally has a regularly enrolled body of students in attendance at the place where it carries on its educational activities. Amended 2009 tax return Qualified education expenses. Amended 2009 tax return   These are expenses for: Tuition and fees required to enroll at or attend an eligible educational institution, and Course-related expenses, such as fees, books, supplies, and equipment that are required for the courses at the eligible educational institution. Amended 2009 tax return These items must be required of all students in your course of instruction. Amended 2009 tax return However, in order for these to be qualified education expenses, the terms of the scholarship or fellowship cannot require that it be used for other purposes, such as room and board, or specify that it cannot be used for tuition or course-related expenses. Amended 2009 tax return Expenses that do not qualify. Amended 2009 tax return   Qualified education expenses do not include the cost of: Room and board, Travel, Research, Clerical help, or Equipment and other expenses that are not required for enrollment in or attendance at an eligible educational institution. Amended 2009 tax return This is true even if the fee must be paid to the institution as a condition of enrollment or attendance. Amended 2009 tax return Scholarship or fellowship amounts used to pay these costs are taxable. Amended 2009 tax return Amounts used to pay expenses that do not qualify. Amended 2009 tax return   A scholarship amount used to pay any expense that does not qualify is taxable, even if the expense is a fee that must be paid to the institution as a condition of enrollment or attendance. Amended 2009 tax return Payment for services. Amended 2009 tax return   You cannot exclude from income the portion of any scholarship, fellowship, or tuition reduction that represents payment for past, present, or future teaching, research, or other services. Amended 2009 tax return This is true even if all candidates for a degree are required to perform the services as a condition for receiving the degree. Amended 2009 tax return Example. Amended 2009 tax return On January 7, Maria Gomez is notified of a scholarship of $2,500 for the spring semester. Amended 2009 tax return As a condition for receiving the scholarship, Maria must serve as a part-time teaching assistant. Amended 2009 tax return Of the $2,500 scholarship, $1,000 represents payment for her services. Amended 2009 tax return Assuming that Maria meets all other conditions, she can exclude no more than $1,500 from income as a qualified scholarship. Amended 2009 tax return Prev  Up  Next   Home   More Online Publications
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Medical advances have resulted in an increased need for nursing home care and assisted living. Most health insurance plans and Medicare severely limit or exclude long-term care. You should consider these costs as you plan for retirement. Here are some questions to ask when considering a separate long-term care insurance policy.

  • What qualifies you for benefits? Some insurers say you must be unable to perform a specific number of the following activities of daily living: eating, walking, getting from bed to a chair, dressing, bathing, using a toilet and remaining continent.
  • What type of care is covered? Does the policy cover nursing home care? What about coverage for assisted living facilities that provide less client care than a nursing home? If you want to stay in your home, will it pay for care provided by visiting nurses and therapists? What about help with food preparation and housecleaning?
  • What will the benefit amount be? Most plans are written to provide a specific dollar benefit per day. The benefit for home care is usually about half the nursing-home benefit. But some policies pay the same for both forms of care. Other plans pay only for your actual expenses.
  • What is the benefit period? It is possible to get a policy with lifetime benefits but this can be very expensive. Other options for coverage are from one to six years. The average nursing home stay is about 2.5 years.
  • Is the benefit adjusted for inflation? If you buy a policy prior to age 60, you face the risk that a fixed daily benefit will not be enough by the time you need it.
  • Is there a waiting period before benefits begin? A 20 to 100 day period is not unusual.

Other Insurance

  • Travel Insurance. There are four kinds of travel insurance: Travel Cancellation Insurance, Baggage or Personal Effects Coverage, Emergency Medical Coverage and Accidental Death. One helpful website is insuremytrip.com.
  • Identity Theft Insurance. This type of insurance provides reimbursement to crime victims for the cost of restoring their identity and repairing credit reports. Some companies now include this as part of their homeowner's insurance policy. Others sell it as a stand-alone policy. Ask your homeowner policy company for information.
  • International Healthcare Insurance. A policy that provides health coverage no matter where you are in the world. The policy term is flexible so you can purchase only for the time you will be out of the country. Contact your current healthcare provider for coverage information.
  • Catastrophic Health Care Insurance. A health plan that only cover certain types of expensive care, like hospitalizations.
  • Liability Insurance. Insurance for what the policyholder is legally obligated to pay because of bodily injury or property damage caused to another person. Search online or ask your personal insurance agent for more information.
  • Umbrella insurance A policy that supplements the insurance you already have for home, auto, and other personal property. can help cover costs that exceed the limits of other policies.

The Amended 2009 Tax Return

Amended 2009 tax return 6. Amended 2009 tax return   Tip Income Table of Contents Introduction Useful Items - You may want to see: Keeping a Daily Tip RecordElectronic tip record. Amended 2009 tax return Reporting Tips to Your EmployerElectronic tip statement. Amended 2009 tax return Final report. Amended 2009 tax return Reporting Tips on Your Tax Return Allocated Tips Introduction This chapter is for employees who receive tips. Amended 2009 tax return All tips you receive are income and are subject to federal income tax. Amended 2009 tax return You must include in gross income all tips you receive directly, charged tips paid to you by your employer, and your share of any tips you receive under a tip-splitting or tip-pooling arrangement. Amended 2009 tax return The value of noncash tips, such as tickets, passes, or other items of value, is also income and subject to tax. Amended 2009 tax return Reporting your tip income correctly is not difficult. Amended 2009 tax return You must do three things. Amended 2009 tax return Keep a daily tip record. Amended 2009 tax return Report tips to your employer. Amended 2009 tax return Report all your tips on your income tax return. Amended 2009 tax return  This chapter will explain these three things and show you what to do on your tax return if you have not done the first two. Amended 2009 tax return This chapter will also show you how to treat allocated tips. Amended 2009 tax return For information on special tip programs and agreements, see Publication 531. Amended 2009 tax return Useful Items - You may want to see: Publication 531 Reporting Tip Income 1244 Employee's Daily Record of Tips and Report to Employer Form (and Instructions) 4137 Social Security and Medicare Tax on Unreported Tip Income 4070 Employee's Report of Tips to Employer Keeping a Daily Tip Record Why keep a daily tip record. Amended 2009 tax return   You must keep a daily tip record so you can: Report your tips accurately to your employer, Report your tips accurately on your tax return, and Prove your tip income if your return is ever questioned. Amended 2009 tax return How to keep a daily tip record. Amended 2009 tax return   There are two ways to keep a daily tip record. Amended 2009 tax return You can either: Write information about your tips in a tip diary, or Keep copies of documents that show your tips, such as restaurant bills and credit or debit card charge slips. Amended 2009 tax return You should keep your daily tip record with your tax or other personal records. Amended 2009 tax return You must keep your records for as long as they are important for administration of the federal tax law. Amended 2009 tax return For information on how long to keep records, see How long to keep records in chapter 1. Amended 2009 tax return    If you keep a tip diary, you can use Form 4070A, Employee's Daily Record of Tips. Amended 2009 tax return To get Form 4070A, ask the Internal Revenue Service (IRS) or your employer for Publication 1244. Amended 2009 tax return Also, Publication 1244 is available online at www. Amended 2009 tax return irs. Amended 2009 tax return gov/pub/irs-pdf/p1244. Amended 2009 tax return pdf. Amended 2009 tax return Publication 1244 includes a 1-year supply of Form 4070A. Amended 2009 tax return Each day, write in the information asked for on the form. Amended 2009 tax return   In addition to the information asked for on Form 4070A, you also need to keep a record of the date and value of any noncash tips you get, such as tickets, passes, or other items of value. Amended 2009 tax return Although you do not report these tips to your employer, you must report them on your tax return. Amended 2009 tax return   If you do not use Form 4070A, start your records by writing your name, your employer's name, and the name of the business (if it is different from your employer's name). Amended 2009 tax return Then, each workday, write the date and the following information. Amended 2009 tax return Cash tips you get directly from customers or from other employees. Amended 2009 tax return Tips from credit and debit card charge customers that your employer pays you. Amended 2009 tax return The value of any noncash tips you get, such as tickets, passes, or other items of value. Amended 2009 tax return The amount of tips you paid out to other employees through tip pools or tip splitting, or other arrangements, and the names of the employees to whom you paid the tips. Amended 2009 tax return Electronic tip record. Amended 2009 tax return   You can use an electronic system provided by your employer to record your daily tips. Amended 2009 tax return If you do, you must receive and keep a paper copy of this record. Amended 2009 tax return Service charges. Amended 2009 tax return    Do not write in your tip diary the amount of any service charge that your employer adds to a customer's bill and then pays to you and treats as wages. Amended 2009 tax return This is part of your wages, not a tip. Amended 2009 tax return See examples below. Amended 2009 tax return Example 1. Amended 2009 tax return Good Food Restaurant adds an 18% charge to the bill for parties of 6 or more customers. Amended 2009 tax return Jane’s bill for food and beverages for her party of 8 includes an amount on the tip line equal to 18% of the charges for food and beverages, and the total includes this amount. Amended 2009 tax return Because Jane did not have an unrestricted right to determine the amount on the “tip line,” the 18% charge is considered a service charge. Amended 2009 tax return Do not include the 18% charge in your tip diary. Amended 2009 tax return Service charges that are paid to you are considered wages, not tips. Amended 2009 tax return Example 2. Amended 2009 tax return Good Food Restaurant also includes sample calculations of tip amounts at the bottom of its bills for food and beverages provided to customers. Amended 2009 tax return David’s bill includes a blank “tip line,” with sample tip calculations of 15%, 18%, and 20% of his charges for food and beverages at the bottom of the bill beneath the signature line. Amended 2009 tax return Because David is free to enter any amount on the “tip line” or leave it blank, any amount he includes is considered a tip. Amended 2009 tax return Be sure to include this amount in your tip diary. Amended 2009 tax return Reporting Tips to Your Employer Why report tips to your employer. Amended 2009 tax return   You must report tips to your employer so that: Your employer can withhold federal income tax and social security, Medicare, Additional Medicare, or railroad retirement taxes, Your employer can report the correct amount of your earnings to the Social Security Administration or Railroad Retirement Board (which affects your benefits when you retire or if you become disabled, or your family's benefits if you die), and You can avoid the penalty for not reporting tips to your employer (explained later). Amended 2009 tax return What tips to report. Amended 2009 tax return   Report to your employer only cash, check, and debit and credit card tips you receive. Amended 2009 tax return   If your total tips for any 1 month from any one job are less than $20, do not report the tips for that month to that employer. Amended 2009 tax return   If you participate in a tip-splitting or tip-pooling arrangement, report only the tips you receive and retain. Amended 2009 tax return Do not report to your employer any portion of the tips you receive that you pass on to other employees. Amended 2009 tax return However, you must report tips you receive from other employees. Amended 2009 tax return    Do not report the value of any noncash tips, such as tickets or passes, to your employer. Amended 2009 tax return You do not pay social security, Medicare, Additional Medicare or railroad retirement taxes on these tips. Amended 2009 tax return How to report. Amended 2009 tax return    If your employer does not give you any other way to report tips, you can use Form 4070. Amended 2009 tax return Fill in the information asked for on the form, sign and date the form, and give it to your employer. Amended 2009 tax return To get a 1-year supply of the form, ask the IRS or your employer for Publication 1244. Amended 2009 tax return   If you do not use Form 4070, give your employer a statement with the following information. Amended 2009 tax return Your name, address, and social security number. Amended 2009 tax return Your employer's name, address, and business name (if it is different from your employer's name). Amended 2009 tax return The month (or the dates of any shorter period) in which you received tips. Amended 2009 tax return The total tips required to be reported for that period. Amended 2009 tax return You must sign and date the statement. Amended 2009 tax return Be sure to keep a copy with your tax or other personal records. Amended 2009 tax return   Your employer may require you to report your tips more than once a month. Amended 2009 tax return However, the statement cannot cover a period of more than 1 calendar month. Amended 2009 tax return Electronic tip statement. Amended 2009 tax return   Your employer can have you furnish your tip statements electronically. Amended 2009 tax return When to report. Amended 2009 tax return   Give your report for each month to your employer by the 10th of the next month. Amended 2009 tax return If the 10th falls on a Saturday, Sunday, or legal holiday, give your employer the report by the next day that is not a Saturday, Sunday, or legal holiday. Amended 2009 tax return Example. Amended 2009 tax return You must report your tips received in September 2014 by October 10, 2014. Amended 2009 tax return Final report. Amended 2009 tax return   If your employment ends during the month, you can report your tips when your employment ends. Amended 2009 tax return Penalty for not reporting tips. Amended 2009 tax return   If you do not report tips to your employer as required, you may be subject to a penalty equal to 50% of the social security, Medicare, and Additional Medicare taxes or railroad retirement tax you owe on the unreported tips. Amended 2009 tax return (For information about these taxes, see Reporting social security, Medicare, Additional Medicare, or railroad retirement taxes on tips not reported to your employer under Reporting Tips on Your Tax Return, later. Amended 2009 tax return ) The penalty amount is in addition to the taxes you owe. Amended 2009 tax return   You can avoid this penalty if you can show reasonable cause for not reporting the tips to your employer. Amended 2009 tax return To do so, attach a statement to your return explaining why you did not report them. Amended 2009 tax return Giving your employer money for taxes. Amended 2009 tax return   Your regular pay may not be enough for your employer to withhold all the taxes you owe on your regular pay plus your reported tips. Amended 2009 tax return If this happens, you can give your employer money until the close of the calendar year to pay the rest of the taxes. Amended 2009 tax return   If you do not give your employer enough money, your employer will apply your regular pay and any money you give in the following order. Amended 2009 tax return All taxes on your regular pay. Amended 2009 tax return Social security, Medicare, and Additional Medicare taxes or railroad retirement taxes on your reported tips. Amended 2009 tax return Federal, state, and local income taxes on your reported tips. Amended 2009 tax return    Any taxes that remain unpaid can be collected by your employer from your next paycheck. Amended 2009 tax return If withholding taxes remain uncollected at the end of the year, you may be subject to a penalty for underpayment of estimated taxes. Amended 2009 tax return See Publication 505, Tax Withholding and Estimated Tax, for more information. Amended 2009 tax return    Uncollected taxes. Amended 2009 tax return You must report on your tax return any social security and Medicare taxes or railroad retirement tax that remained uncollected at the end of 2013. Amended 2009 tax return These uncollected taxes will be shown on your 2013 Form W-2. Amended 2009 tax return See Reporting uncollected social security, Medicare, or railroad retirement taxes on tips reported to your employer under Reporting Tips on Your Tax Return, later. Amended 2009 tax return Reporting Tips on Your Tax Return How to report tips. Amended 2009 tax return    Report your tips with your wages on Form 1040, line 7; Form 1040A, line 7; or Form 1040EZ, line 1. Amended 2009 tax return What tips to report. Amended 2009 tax return   You must report all tips you received in 2013 on your tax return, including both cash tips and noncash tips. Amended 2009 tax return Any tips you reported to your employer for 2013 are included in the wages shown in box 1 of your Form W-2. Amended 2009 tax return Add to the amount in box 1 only the tips you did not report to your employer. Amended 2009 tax return    If you received $20 or more in cash and charge tips in a month and did not report all of those tips to your employer, see Reporting social security, Medicare, Additional Medicare, or railroad retirement taxes on tips not reported to your employer, later. Amended 2009 tax return    If you did not keep a daily tip record as required and an amount is shown in box 8 of your Form W-2, see Allocated Tips, later. Amended 2009 tax return   If you kept a daily tip record and reported tips to your employer as required under the rules explained earlier, add the following tips to the amount in box 1 of your Form W-2. Amended 2009 tax return Cash and charge tips you received that totaled less than $20 for any month. Amended 2009 tax return The value of noncash tips, such as tickets, passes, or other items of value. Amended 2009 tax return Example. Amended 2009 tax return Ben Smith began working at the Blue Ocean Restaurant (his only employer in 2013) on June 30 and received $10,000 in wages during the year. Amended 2009 tax return Ben kept a daily tip record showing that his tips for June were $18 and his tips for the rest of the year totaled $7,000. Amended 2009 tax return He was not required to report his June tips to his employer, but he reported all of the rest of his tips to his employer as required. Amended 2009 tax return Ben's Form W-2 from Blue Ocean Restaurant shows $17,000 ($10,000 wages plus $7,000 reported tips) in box 1. Amended 2009 tax return He adds the $18 unreported tips to that amount and reports $17,018 as wages on his tax return. Amended 2009 tax return Reporting social security, Medicare, Additional Medicare, or railroad retirement taxes on tips not reported to your employer. Amended 2009 tax return    If you received $20 or more in cash and charge tips in a month from any one job and did not report all of those tips to your employer, you must report the social security, Medicare, and Additional Medicare taxes on the unreported tips as additional tax on your return. Amended 2009 tax return To report these taxes, you must file a return even if you would not otherwise have to file. Amended 2009 tax return You must use Form 1040. Amended 2009 tax return (You cannot file Form 1040EZ or Form 1040A. Amended 2009 tax return )    Use Form 4137 to figure social security and Medicare taxes. Amended 2009 tax return Enter the tax on your return as instructed, and attach the completed Form 4137 to your return. Amended 2009 tax return Use Form 8959 to figure Additional Medicare Tax. Amended 2009 tax return    If you are subject to the Railroad Retirement Tax Act, you cannot use Form 4137 to pay railroad retirement tax on unreported tips. Amended 2009 tax return To get railroad retirement credit, you must report tips to your employer. Amended 2009 tax return Reporting uncollected social security, Medicare, or railroad retirement taxes on tips reported to your employer. Amended 2009 tax return   You may have uncollected taxes if your regular pay was not enough for your employer to withhold all the taxes you owe and you did not give your employer enough money to pay the rest of the taxes. Amended 2009 tax return For more information, see Giving your employer money for taxes , under Reporting Tips to Your Employer, earlier. Amended 2009 tax return   If your employer could not collect all the social security and Medicare taxes or railroad retirement tax you owe on tips reported for 2013, the uncollected taxes will be shown in box 12 of your Form W-2 (codes A and B). Amended 2009 tax return You must report these amounts as additional tax on your return. Amended 2009 tax return Unlike the uncollected portion of the regular (1. Amended 2009 tax return 45%) Medicare tax, the uncollected Additional Medicare Tax is not reported in box 12 of Form W-2 with code B. Amended 2009 tax return    To report these uncollected taxes, you must file a return even if you would not otherwise have to file. Amended 2009 tax return You must report these taxes on Form 1040, line 60. Amended 2009 tax return See the instructions for Form 1040, line 60. Amended 2009 tax return (You cannot file Form 1040EZ or Form 1040A. Amended 2009 tax return ) Allocated Tips If your employer allocated tips to you, they are shown separately in box 8 of your Form W-2. Amended 2009 tax return They are not included in box 1 with your wages and reported tips. Amended 2009 tax return If box 8 is blank, this discussion does not apply to you. Amended 2009 tax return What are allocated tips. Amended 2009 tax return   These are tips that your employer assigned to you in addition to the tips you reported to your employer for the year. Amended 2009 tax return Your employer will have done this only if: You worked in an establishment (restaurant, cocktail lounge, or similar business) that must allocate tips to employees, and The tips you reported to your employer were less than your share of 8% of food and drink sales. Amended 2009 tax return No income, social security, Medicare, Additional Medicare or railroad retirement taxes are withheld on allocated tips. Amended 2009 tax return How were your allocated tips figured. Amended 2009 tax return   The tips allocated to you are your share of an amount figured by subtracting the reported tips of all employees from 8% (or an approved lower rate) of food and drink sales (other than carryout sales and sales with a service charge of 10% or more). Amended 2009 tax return Your share of that amount was figured using either a method provided by an employer-employee agreement or a method provided by IRS regulations based on employees' sales or hours worked. Amended 2009 tax return For information about the exact allocation method used, ask your employer. Amended 2009 tax return Must you report your allocated tips on your tax return. Amended 2009 tax return   You must report all tips you received in 2013 on your tax return, including both cash tips and noncash tips. Amended 2009 tax return Any tips you reported to your employer for 2013 are included in the wages shown in box 1 of your Form W-2. Amended 2009 tax return Add to the amount in box 1 only the tips you did not report to your employer. Amended 2009 tax return This should include any allocated tips shown in box 8 on your Form(s) W-2, unless you have adequate records to show that you received less tips in the year than the allocated figures. Amended 2009 tax return   See What tips to report under Reporting Tips on Your Tax Return, and Keeping a Daily Tip Record , earlier. Amended 2009 tax return How to report allocated tips. Amended 2009 tax return   Report the amount in box 1 and the allocated tips in box 8 of your Form(s) W-2 as wages on Form 1040, line 7; Form 1040NR, line 8; or Form 1040NR-EZ, line 3. Amended 2009 tax return (You cannot file Form 1040A or Form 1040EZ when you have allocated tips. Amended 2009 tax return )    Because social security, Medicare, and Additional Medicare taxes were not withheld from the allocated tips, you must report those taxes as additional tax on your return. Amended 2009 tax return Complete Form 4137, and include the allocated tips on line 1 of the form. Amended 2009 tax return See Reporting social security, Medicare, Additional Medicare, or railroad retirement taxes on tips not reported to your employer under Reporting Tips on Your Tax Return, earlier. 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