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File My 2011 Taxes Online Free

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File My 2011 Taxes Online Free

File my 2011 taxes online free Publication 509 - Introductory Material Table of Contents Future Developments What's New Reminders IntroductionOrdering forms and publications. File my 2011 taxes online free Tax questions. File my 2011 taxes online free Background Information for Using the Tax CalendarsElectronic deposit requirement. File my 2011 taxes online free Legal holidays. File my 2011 taxes online free Statewide legal holidays. File my 2011 taxes online free Future Developments For the latest information about developments related to Publication 509, such as legislation enacted after it was published, go to www. File my 2011 taxes online free irs. File my 2011 taxes online free gov/pub509. File my 2011 taxes online free What's New Publication 1518 discontinued after 2013. File my 2011 taxes online free  Publication 1518, IRS Tax Calendar for Small Businesses and Self-Employed, is discontinued after 2013. File my 2011 taxes online free An IRS Tax Calendar and most of the information previously contained in Publication 1518 can be found at www. File my 2011 taxes online free irs. File my 2011 taxes online free gov/taxcalendar. File my 2011 taxes online free Reminders Photographs of missing children. File my 2011 taxes online free  The Internal Revenue Service is a proud partner with the National Center for Missing and Exploited Children. File my 2011 taxes online free Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. File my 2011 taxes online free 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. File my 2011 taxes online free Introduction A tax calendar is a 12-month calendar divided into quarters. File my 2011 taxes online free The calendar gives specific due dates for: Filing tax forms, Paying taxes, and Taking other actions required by federal tax law. File my 2011 taxes online free What does this publication contain?   This publication contains the following. File my 2011 taxes online free A section on how to use the tax calendars. File my 2011 taxes online free Three tax calendars: General Tax Calendar, Employer's Tax Calendar, and Excise Tax Calendar. File my 2011 taxes online free A table showing the semiweekly deposit due dates for payroll taxes for 2014. File my 2011 taxes online free   Most of the due dates discussed in this publication are also included in the IRS Tax Calendar available at www. File my 2011 taxes online free irs. File my 2011 taxes online free gov/taxcalendar. File my 2011 taxes online free Who should use this publication?   Primarily, employers need to use this publication. File my 2011 taxes online free However, the General Tax Calendar has important due dates for all businesses and individuals. File my 2011 taxes online free Anyone who must pay excise taxes may need the Excise Tax Calendar . File my 2011 taxes online free What are the advantages of using a tax calendar?   The following are advantages of using a calendar. File my 2011 taxes online free You do not have to figure the due dates yourself. File my 2011 taxes online free You can file or pay timely and avoid penalties. File my 2011 taxes online free You do not have to adjust the due dates for Saturdays, Sundays, and legal holidays. File my 2011 taxes online free You do not have to adjust the due dates for special banking rules if you use the Employer's Tax Calendar or Excise Tax Calendar . File my 2011 taxes online free Which calendar(s) should I use?   To decide which calendar(s) to use, first look at the General Tax Calendar and highlight the dates that apply to you. File my 2011 taxes online free If you are an employer, also use the Employer's Tax Calendar . File my 2011 taxes online free If you must pay excise taxes, use the Excise Tax Calendar . File my 2011 taxes online free Depending on your situation, you may need to use more than one calendar. File my 2011 taxes online free Table 1. File my 2011 taxes online free Useful Publications IF you are. File my 2011 taxes online free . File my 2011 taxes online free . File my 2011 taxes online free THEN you may need. File my 2011 taxes online free . File my 2011 taxes online free . File my 2011 taxes online free An employer • Publication 15 (Circular E), Employer's Tax Guide. File my 2011 taxes online free  • Publication 15-A, Employer's Supplemental Tax Guide. File my 2011 taxes online free  • Publication 15-B, Employer's Tax Guide to Fringe Benefits. File my 2011 taxes online free  • Publication 926, Household Employer's Tax Guide. File my 2011 taxes online free A farmer • Publication 51 (Circular A), Agricultural Employer's Tax Guide. File my 2011 taxes online free  • Publication 225, Farmer's Tax Guide. File my 2011 taxes online free An individual • Publication 505, Tax Withholding and Estimated Tax. File my 2011 taxes online free Required to pay excise taxes • Publication 510, Excise Taxes. File my 2011 taxes online free What is not in these calendars?   The calendars do not cover the employment or excise tax deposit rules. File my 2011 taxes online free You can find the deposit rules for employment taxes in Publication 15 (Circular E), Employer's Tax Guide. File my 2011 taxes online free The deposit rules for excise taxes are in Publication 510, Excise Taxes, and in the Instructions for Form 720, Quarterly Federal Excise Tax Return. File my 2011 taxes online free In addition, the calendars do not cover filing forms and other requirements for: Estate taxes, Gift taxes, Trusts, Exempt organizations, Certain types of corporations, or Foreign partnerships. File my 2011 taxes online free What other publications and tax forms will I need?   Table 1 lists other publications you may need to order. File my 2011 taxes online free Each calendar lists the forms you may need. File my 2011 taxes online free   See How To Get Tax Help near the end of this publication for information about getting publications and forms. File my 2011 taxes online free Comments and suggestions. File my 2011 taxes online free   We welcome your comments about this publication and your suggestions for future editions. File my 2011 taxes online free   You can write to us at the following address: Internal Revenue Service Tax Forms and Publications Division 1111 Constitution Ave. File my 2011 taxes online free NW, IR-6526 Washington, DC 20224   We respond to many letters by telephone. File my 2011 taxes online free Therefore, it would be helpful if you would include your daytime phone number, including the area code, in your correspondence. File my 2011 taxes online free   You can send us comments from www. File my 2011 taxes online free irs. File my 2011 taxes online free gov/formspubs. File my 2011 taxes online free Click on More Information and then click on Comment on Tax Forms and Publications. File my 2011 taxes online free   Although we cannot respond individually to each comment received, we do appreciate your feedback and will consider your comments as we revise our forms and publications. File my 2011 taxes online free Ordering forms and publications. File my 2011 taxes online free   Visit www. File my 2011 taxes online free irs. File my 2011 taxes online free 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. File my 2011 taxes online free Internal Revenue Service 1201 N. File my 2011 taxes online free Mitsubishi Motorway Bloomington, IL 61705-6613 Tax questions. File my 2011 taxes online free   If you have a tax question, check the information available on IRS. File my 2011 taxes online free gov or call 1-800-829-1040. File my 2011 taxes online free We cannot answer tax questions sent to either of the above addresses. File my 2011 taxes online free Background Information for Using the Tax Calendars The following brief explanations may be helpful to you in using the tax calendars. File my 2011 taxes online free IRS e-services make taxes easier. File my 2011 taxes online free   Now more than ever before, businesses can enjoy the benefits of filing and paying their federal taxes electronically. File my 2011 taxes online free Whether you rely on a tax professional or handle your own taxes, the IRS offers you convenient programs to make taxes easier. File my 2011 taxes online free    You can e-file your Form 1040; certain business tax returns such as Forms 1120, 1120S, and 1065; certain employment tax returns such as Forms 940 and 941; certain excise tax returns such as Forms 720, 2290, and 8849; and Form 1099 and other information returns. File my 2011 taxes online free Visit www. File my 2011 taxes online free irs. File my 2011 taxes online free gov/efile for more information. File my 2011 taxes online free You can pay taxes online or by phone using the Electronic Federal Tax Payments System (EFTPS). File my 2011 taxes online free For detailed information about using this free service, see Electronic deposit requirement below. File my 2011 taxes online free   Use these electronic options to make filing and paying taxes easier. File my 2011 taxes online free For more information on electronic payments, visit the IRS website at www. File my 2011 taxes online free irs. File my 2011 taxes online free gov/e-pay. File my 2011 taxes online free Tax deposits. File my 2011 taxes online free   Some taxes can be paid with the return on which they are reported. File my 2011 taxes online free However, in many cases, you have to deposit the tax before the due date for filing the return. File my 2011 taxes online free Tax deposits are figured for periods of time that are shorter than the time period covered by the return. File my 2011 taxes online free See Publication 15 (Circular E) for the employment tax deposit rules. File my 2011 taxes online free For the excise tax deposit rules, see Publication 510 or the Instructions for Form 720. File my 2011 taxes online free    Electronic deposit requirement. File my 2011 taxes online free   You must use electronic funds transfer to make all federal tax deposits (such as deposits of employment tax, excise tax, and corporate income tax). File my 2011 taxes online free Generally, electronic fund transfers are made using the Electronic Federal Tax Payment System (EFTPS). File my 2011 taxes online free EFTPS is a free service provided by the Department of Treasury. File my 2011 taxes online free If you do not want to use EFTPS, you can arrange for your tax professional, financial institution, payroll service, or other trusted third party to make electronic deposits on your behalf. File my 2011 taxes online free   To get more information or to enroll in EFTPS, call 1-800-555-4477 (business), 1-800-316-6541 (individual), or 1-800-733-4829 (TDD/TTY). File my 2011 taxes online free You can also visit the EFTPS website at www. File my 2011 taxes online free eftps. File my 2011 taxes online free gov. File my 2011 taxes online free Additional information about EFTPS is also available in Publication 966, Electronic Federal Tax Payment System: A Guide to Getting Started. File my 2011 taxes online free    If you fail to timely, properly, and in full make your federal tax deposit, you may be subject to a failure-to-deposit penalty. File my 2011 taxes online free For an EFTPS deposit to be on time, you must initiate the deposit by 8 p. File my 2011 taxes online free m. File my 2011 taxes online free Eastern time the day before the date the deposit is due. File my 2011 taxes online free Saturday, Sunday, or legal holiday. File my 2011 taxes online free   Generally, if a due date for performing any act for tax purposes falls on a Saturday, Sunday, or legal holiday, the act is considered to be performed timely if it is performed no later than the next day that is not a Saturday, Sunday, or legal holiday. File my 2011 taxes online free The term legal holiday means any legal holiday in the District of Columbia. File my 2011 taxes online free The calendars provided in this publication make the adjustment for Saturdays, Sundays, and legal holidays. File my 2011 taxes online free But you must make any adjustments for statewide legal holidays, as discussed next. File my 2011 taxes online free An exception to this rule for certain excise taxes is noted later under the Excise Tax Calendar. File my 2011 taxes online free Legal holidays. File my 2011 taxes online free   Legal holidays for 2014 are listed below. File my 2011 taxes online free January 1— New Year's Day January 20— Birthday of Martin Luther King, Jr. File my 2011 taxes online free / Inauguration Day February 17— Washington's Birthday April 16— District of Columbia Emancipation Day May 26— Memorial Day July 4— Independence Day September 1— Labor Day October 13— Columbus Day November 11— Veterans Day November 27— Thanksgiving Day December 25— Christmas Day Statewide legal holidays. File my 2011 taxes online free   A statewide legal holiday delays a due date for filing a return only if the IRS office where you are required to file is located in that state. File my 2011 taxes online free A statewide legal holiday does not delay a due date for making a federal tax deposit. File my 2011 taxes online free Extended due date for Forms 1098, 1099, and W-2 if filed electronically. File my 2011 taxes online free   If you file Forms 1098, 1099, or W-2 electronically, your due date for filing them with the IRS or the Social Security Administration (SSA) will be extended to March 31. File my 2011 taxes online free   For 2014, the due date for giving the recipient these forms is January 31. File my 2011 taxes online free   For information about filing Forms 1098, 1099, or W-2G electronically, see Publication 1220, Specifications for Filing Forms 1097, 1098, 1099, 3921, 3922, 5498, 8935, and W-2G Electronically. File my 2011 taxes online free For information about filing Form W-2 electronically with the SSA, visit www. File my 2011 taxes online free ssa. File my 2011 taxes online free gov/employer or call 1-800-772-6270. File my 2011 taxes online free Penalties. File my 2011 taxes online free   Whenever possible, you should take action before the listed due date. File my 2011 taxes online free If you are late, you may have to pay a penalty as well as interest on any overdue taxes. File my 2011 taxes online free   Be sure to follow all the tax laws that apply to you. File my 2011 taxes online free In addition to civil penalties, criminal penalties may be imposed for intentionally not paying taxes, for intentionally filing a false return, or for not filing a required return. File my 2011 taxes online free Use of private delivery services. File my 2011 taxes online free   You can use certain private delivery services designated by the IRS to meet the timely mailing as timely filing/paying rule for tax returns and payments. File my 2011 taxes online free These private delivery services include only the following. File my 2011 taxes online free DHL Express (DHL): DHL Same Day Service. File my 2011 taxes online free Federal Express (FedEx): FedEx Priority Overnight, FedEx Standard Overnight, FedEx 2 Day, FedEx International Priority, and FedEx International First. File my 2011 taxes online free United Parcel Service (UPS): UPS Next Day Air, UPS Next Day Air Saver, UPS 2nd Day Air, UPS 2nd Day Air A. File my 2011 taxes online free M. File my 2011 taxes online free , UPS Worldwide Express Plus, and UPS Worldwide Express. File my 2011 taxes online free   For the IRS mailing address to use if you are using a private delivery service, go to IRS. File my 2011 taxes online free gov and enter “private delivery service” in the search box. File my 2011 taxes online free   The private delivery service can tell you how to get written proof of the mailing date. File my 2011 taxes online free    The U. File my 2011 taxes online free S. File my 2011 taxes online free Postal Service advises that private delivery services cannot deliver items to P. File my 2011 taxes online free O. File my 2011 taxes online free boxes. File my 2011 taxes online free You must use the U. File my 2011 taxes online free S. File my 2011 taxes online free Postal Service to mail any item to an IRS P. File my 2011 taxes online free O. File my 2011 taxes online free box address. File my 2011 taxes online free Prev  Up  Next   Home   More Online Publications
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File my 2011 taxes online free 4. File my 2011 taxes online free   Special Situations Table of Contents Condominiums CooperativesDepreciation Property Changed to Rental UseBasis of Property Changed to Rental Use Figuring the Depreciation Deduction Renting Part of Property Not Rented for ProfitPostponing decision. File my 2011 taxes online free Example—Property Changed to Rental Use This chapter discusses some rental real estate activities that are subject to additional rules. File my 2011 taxes online free Condominiums A condominium is most often a dwelling unit in a multi-unit building, but can also take other forms, such as a townhouse or garden apartment. File my 2011 taxes online free If you own a condominium, you also own a share of the common elements, such as land, lobbies, elevators, and service areas. File my 2011 taxes online free You and the other condominium owners may pay dues or assessments to a special corporation that is organized to take care of the common elements. File my 2011 taxes online free Special rules apply if you rent your condominium to others. File my 2011 taxes online free You can deduct as rental expenses all the expenses discussed in chapters 1 and 2. File my 2011 taxes online free In addition, you can deduct any dues or assessments paid for maintenance of the common elements. File my 2011 taxes online free You cannot deduct special assessments you pay to a condominium management corporation for improvements. File my 2011 taxes online free However, you may be able to recover your share of the cost of any improvement by taking depreciation. File my 2011 taxes online free Cooperatives If you live in a cooperative, you do not own your apartment. File my 2011 taxes online free Instead, a corporation owns the apartments and you are a tenant-stockholder in the cooperative housing corporation. File my 2011 taxes online free If you rent your apartment to others, you usually can deduct, as a rental expense, all the maintenance fees you pay to the cooperative housing corporation. File my 2011 taxes online free In addition to the maintenance fees paid to the cooperative housing corporation, you can deduct your direct payments for repairs, upkeep, and other rental expenses, including interest paid on a loan used to buy your stock in the corporation. File my 2011 taxes online free Depreciation You will be depreciating your stock in the corporation rather than the apartment itself. File my 2011 taxes online free Figure your depreciation deduction as follows. File my 2011 taxes online free Figure the depreciation for all the depreciable real property owned by the corporation. File my 2011 taxes online free (Depreciation methods are discussed in chapter 2 of this publication and Publication 946. File my 2011 taxes online free ) If you bought your cooperative stock after its first offering, figure the depreciable basis of this property as follows. File my 2011 taxes online free Multiply your cost per share by the total number of outstanding shares. File my 2011 taxes online free Add to the amount figured in (a) any mortgage debt on the property on the date you bought the stock. File my 2011 taxes online free Subtract from the amount figured in (b) any mortgage debt that is not for the depreciable real property, such as the part for the land. File my 2011 taxes online free Subtract from the amount figured in (1) any depreciation for space owned by the corporation that can be rented but cannot be lived in by tenant-stockholders. File my 2011 taxes online free Divide the number of your shares of stock by the total number of shares outstanding, including any shares held by the corporation. File my 2011 taxes online free Multiply the result of (2) by the percentage you figured in (3). File my 2011 taxes online free This is your depreciation on the stock. File my 2011 taxes online free Your depreciation deduction for the year cannot be more than the part of your adjusted basis (defined in chapter 2) in the stock of the corporation that is allocable to your rental property. File my 2011 taxes online free Payments added to capital account. File my 2011 taxes online free   Payments earmarked for a capital asset or improvement, or otherwise charged to the corporation's capital account are added to the basis of your stock in the corporation. File my 2011 taxes online free For example, you cannot deduct a payment used to pave a community parking lot, install a new roof, or pay the principal of the corporation's mortgage. File my 2011 taxes online free   Treat as a capital cost the amount you were assessed for capital items. File my 2011 taxes online free This cannot be more than the amount by which your payments to the corporation exceeded your share of the corporation's mortgage interest and real estate taxes. File my 2011 taxes online free   Your share of interest and taxes is the amount the corporation elected to allocate to you, if it reasonably reflects those expenses for your apartment. File my 2011 taxes online free Otherwise, figure your share in the following manner. File my 2011 taxes online free Divide the number of your shares of stock by the total number of shares outstanding, including any shares held by the corporation. File my 2011 taxes online free Multiply the corporation's deductible interest by the number you figured in (1). File my 2011 taxes online free This is your share of the interest. File my 2011 taxes online free Multiply the corporation's deductible taxes by the number you figured in (1). File my 2011 taxes online free This is your share of the taxes. File my 2011 taxes online free Property Changed to Rental Use If you change your home or other property (or a part of it) to rental use at any time other than the beginning of your tax year, you must divide yearly expenses, such as taxes and insurance, between rental use and personal use. File my 2011 taxes online free You can deduct as rental expenses only the part of the expense that is for the part of the year the property was used or held for rental purposes. File my 2011 taxes online free You cannot deduct depreciation or insurance for the part of the year the property was held for personal use. File my 2011 taxes online free However, you can include the home mortgage interest, qualified mortgage insurance premiums, and real estate tax expenses for the part of the year the property was held for personal use as an itemized deduction on Schedule A (Form 1040). File my 2011 taxes online free Example. File my 2011 taxes online free Your tax year is the calendar year. File my 2011 taxes online free You moved from your home in May and started renting it out on June 1. File my 2011 taxes online free You can deduct as rental expenses seven-twelfths of your yearly expenses, such as taxes and insurance. File my 2011 taxes online free Starting with June, you can deduct as rental expenses the amounts you pay for items generally billed monthly, such as utilities. File my 2011 taxes online free When figuring depreciation, treat the property as placed in service on June 1. File my 2011 taxes online free Basis of Property Changed to Rental Use When you change property you held for personal use to rental use (for example, you rent your former home), the basis for depreciation will be the lesser of fair market value or adjusted basis on the date of conversion. File my 2011 taxes online free Fair market value. File my 2011 taxes online free   This is the price at which the property would change hands between a willing buyer and a willing seller, neither having to buy or sell, and both having reasonable knowledge of all the relevant facts. File my 2011 taxes online free Sales of similar property, on or about the same date, may be helpful in figuring the fair market value of the property. File my 2011 taxes online free Figuring the basis. File my 2011 taxes online free   The basis for depreciation is the lesser of: The fair market value of the property on the date you changed it to rental use, or Your adjusted basis on the date of the change—that is, your original cost or other basis of the property, plus the cost of permanent additions or improvements since you acquired it, minus deductions for any casualty or theft losses claimed on earlier years' income tax returns and other decreases to basis. File my 2011 taxes online free For other increases and decreases to basis, see Adjusted Basis in chapter 2. File my 2011 taxes online free Example. File my 2011 taxes online free Several years ago you built your home for $140,000 on a lot that cost you $14,000. File my 2011 taxes online free Before changing the property to rental use this year, you added $28,000 of permanent improvements to the house and claimed a $3,500 casualty loss deduction for damage to the house. File my 2011 taxes online free Part of the improvements qualified for a $500 residential energy credit, which you claimed on your 2010 tax return. File my 2011 taxes online free Because land is not depreciable, you can only include the cost of the house when figuring the basis for depreciation. File my 2011 taxes online free The adjusted basis of the house at the time of the change in its use was $164,000 ($140,000 + $28,000 − $3,500 − $500). File my 2011 taxes online free On the date of the change in use, your property had a fair market value of $168,000, of which $21,000 was for the land and $147,000 was for the house. File my 2011 taxes online free The basis for depreciation on the house is the fair market value on the date of the change ($147,000), because it is less than your adjusted basis ($164,000). File my 2011 taxes online free Cooperatives If you change your cooperative apartment to rental use, figure your allowable depreciation as explained earlier. File my 2011 taxes online free (Depreciation methods are discussed in chapter 2 of this publication and Publication 946. File my 2011 taxes online free ) The basis of all the depreciable real property owned by the cooperative housing corporation is the smaller of the following amounts. File my 2011 taxes online free The fair market value of the property on the date you change your apartment to rental use. File my 2011 taxes online free This is considered to be the same as the corporation's adjusted basis minus straight line depreciation, unless this value is unrealistic. File my 2011 taxes online free The corporation's adjusted basis in the property on that date. File my 2011 taxes online free Do not subtract depreciation when figuring the corporation's adjusted basis. File my 2011 taxes online free If you bought the stock after its first offering, the corporation's adjusted basis in the property is the amount figured in (1) under Depreciation (under Cooperatives, near the beginning of this chapter). File my 2011 taxes online free The fair market value of the property is considered to be the same as the corporation's adjusted basis figured in this way minus straight line depreciation, unless the value is unrealistic. File my 2011 taxes online free Figuring the Depreciation Deduction To figure the deduction, use the depreciation system in effect when you convert your residence to rental use. File my 2011 taxes online free Generally, that will be MACRS for any conversion after 1986. File my 2011 taxes online free Treat the property as placed in service on the conversion date. File my 2011 taxes online free Example. File my 2011 taxes online free Your converted residence (see previous example under Figuring the basis) was available for rent on August 1. File my 2011 taxes online free Using Table 2-2d (see chapter 2), the percentage for Year 1 beginning in August is 1. File my 2011 taxes online free 364% and the depreciation deduction for Year 1 is $2,005 ($147,000 × . File my 2011 taxes online free 01364). File my 2011 taxes online free Renting Part of Property If you rent part of your property, you must divide certain expenses between the part of the property used for rental purposes and the part of the property used for personal purposes, as though you actually had two separate pieces of property. File my 2011 taxes online free You can deduct the expenses related to the part of the property used for rental purposes, such as home mortgage interest, qualified mortgage insurance premiums, and real estate taxes, as rental expenses on Schedule E (Form 1040). File my 2011 taxes online free You can also deduct as rental expenses a portion of other expenses that normally are nondeductible personal expenses, such as expenses for electricity, or painting the outside of the house. File my 2011 taxes online free There is no change in the types of expenses deductible for the personal-use part of your property. File my 2011 taxes online free Generally, these expenses may be deducted only if you itemize your deductions on Schedule A (Form 1040). File my 2011 taxes online free You cannot deduct any part of the cost of the first phone line even if your tenants have unlimited use of it. File my 2011 taxes online free You do not have to divide the expenses that belong only to the rental part of your property. File my 2011 taxes online free For example, if you paint a room that you rent, or if you pay premiums for liability insurance in connection with renting a room in your home, your entire cost is a rental expense. File my 2011 taxes online free If you install a second phone line strictly for your tenant's use, all of the cost of the second line is deductible as a rental expense. File my 2011 taxes online free You can deduct depreciation on the part of the house used for rental purposes as well as on the furniture and equipment you use for rental purposes. File my 2011 taxes online free How to divide expenses. File my 2011 taxes online free   If an expense is for both rental use and personal use, such as mortgage interest or heat for the entire house, you must divide the expense between rental use and personal use. File my 2011 taxes online free You can use any reasonable method for dividing the expense. File my 2011 taxes online free It may be reasonable to divide the cost of some items (for example, water) based on the number of people using them. File my 2011 taxes online free The two most common methods for dividing an expense are (1) the number of rooms in your home, and (2) the square footage of your home. File my 2011 taxes online free Example. File my 2011 taxes online free You rent a room in your house. File my 2011 taxes online free The room is 12 × 15 feet, or 180 square feet. File my 2011 taxes online free Your entire house has 1,800 square feet of floor space. File my 2011 taxes online free You can deduct as a rental expense 10% of any expense that must be divided between rental use and personal use. File my 2011 taxes online free If your heating bill for the year for the entire house was $600, $60 ($600 × . File my 2011 taxes online free 10) is a rental expense. File my 2011 taxes online free The balance, $540, is a personal expense that you cannot deduct. File my 2011 taxes online free Duplex. File my 2011 taxes online free   A common situation is the duplex where you live in one unit and rent out the other. File my 2011 taxes online free Certain expenses apply to the entire property, such as mortgage interest and real estate taxes, and must be split to determine rental and personal expenses. File my 2011 taxes online free Example. File my 2011 taxes online free You own a duplex and live in one half, renting the other half. File my 2011 taxes online free Both units are approximately the same size. File my 2011 taxes online free Last year, you paid a total of $10,000 mortgage interest and $2,000 real estate taxes for the entire property. File my 2011 taxes online free You can deduct $5,000 mortgage interest and $1,000 real estate taxes on Schedule E (Form 1040), and if you itemize your deductions, you can deduct the other $5,000 mortgage interest and $1,000 real estate taxes on Schedule A (Form 1040). File my 2011 taxes online free Not Rented for Profit If you do not rent your property to make a profit, you can deduct your rental expenses only up to the amount of your rental income. File my 2011 taxes online free You cannot deduct a loss or carry forward to the next year any rental expenses that are more than your rental income for the year. File my 2011 taxes online free Where to report. File my 2011 taxes online free   Report your not-for-profit rental income on Form 1040 or 1040NR, line 21. File my 2011 taxes online free For example, if you are filing Form 1040, you can include your mortgage interest and any qualified mortgage insurance premiums (if you use the property as your main home or second home), real estate taxes, and casualty losses on the appropriate lines of Schedule A (Form 1040) if you itemize your deductions. File my 2011 taxes online free   If you itemize your deductions, claim your other rental expenses, subject to the rules explained in chapter 1 of Publication 535, as miscellaneous itemized deductions on Schedule A (Form 1040), line 23, or Schedule A (Form 1040NR), line 9. File my 2011 taxes online free You can deduct these expenses only if they, together with certain other miscellaneous itemized deductions, total more than 2% of your adjusted gross income. File my 2011 taxes online free Presumption of profit. File my 2011 taxes online free   If your rental income is more than your rental expenses for at least 3 years out of a period of 5 consecutive years, you are presumed to be renting your property to make a profit. File my 2011 taxes online free Postponing decision. File my 2011 taxes online free   If you are starting your rental activity and do not have 3 years showing a profit, you can elect to have the presumption made after you have the 5 years of experience required by the test. File my 2011 taxes online free You may choose to postpone the decision of whether the rental is for profit by filing Form 5213. File my 2011 taxes online free You must file Form 5213 within 3 years after the due date of your return (determined without extensions) for the year in which you first carried on the activity or, if earlier, within 60 days after receiving written notice from the Internal Revenue Service proposing to disallow deductions attributable to the activity. File my 2011 taxes online free More information. File my 2011 taxes online free   For more information about the rules for an activity not engaged in for profit, see Not-for-Profit Activities in chapter 1 of Publication 535. File my 2011 taxes online free Example—Property Changed to Rental Use In January, Eileen Johnson bought a condominium apartment to live in. File my 2011 taxes online free Instead of selling the house she had been living in, she decided to change it to rental property. File my 2011 taxes online free Eileen selected a tenant and started renting the house on February 1. File my 2011 taxes online free Eileen charges $750 a month for rent and collects it herself. File my 2011 taxes online free Eileen also received a $750 security deposit from her tenant. File my 2011 taxes online free Because she plans to return it to her tenant at the end of the lease, she does not include it in her income. File my 2011 taxes online free Her rental expenses for the year are as follows. File my 2011 taxes online free   Mortgage interest $1,800     Fire insurance (1-year policy) 100     Miscellaneous repairs (after renting) 297     Real estate taxes imposed and paid 1,200   Eileen must divide the real estate taxes, mortgage interest, and fire insurance between the personal use of the property and the rental use of the property. File my 2011 taxes online free She can deduct eleven-twelfths of these expenses as rental expenses. File my 2011 taxes online free She can include the balance of the allowable taxes and mortgage interest on Schedule A (Form 1040) if she itemizes. File my 2011 taxes online free She cannot deduct the balance of the fire insurance because it is a personal expense. File my 2011 taxes online free Eileen bought this house in 1984 for $35,000. File my 2011 taxes online free Her property tax was based on assessed values of $10,000 for the land and $25,000 for the house. File my 2011 taxes online free Before changing it to rental property, Eileen added several improvements to the house. File my 2011 taxes online free She figures her adjusted basis as follows:   Improvements Cost     House $25,000     Remodeled kitchen 4,200     Recreation room 5,800     New roof 1,600     Patio and deck 2,400     Adjusted basis $39,000   On February 1, when Eileen changed her house to rental property, the property had a fair market value of $152,000. File my 2011 taxes online free Of this amount, $35,000 was for the land and $117,000 was for the house. File my 2011 taxes online free Because Eileen's adjusted basis is less than the fair market value on the date of the change, Eileen uses $39,000 as her basis for depreciation. File my 2011 taxes online free As specified for residential rental property, Eileen must use the straight line method of depreciation over the GDS or ADS recovery period. File my 2011 taxes online free She chooses the GDS recovery period of 27. File my 2011 taxes online free 5 years. File my 2011 taxes online free She uses Table 2-2d to find her depreciation percentage. File my 2011 taxes online free Since she placed the property in service in February, the percentage is 3. File my 2011 taxes online free 182%. File my 2011 taxes online free On April 1, Eileen bought a new dishwasher for the rental property at a cost of $425. File my 2011 taxes online free The dishwasher is personal property used in a rental real estate activity, which has a 5-year recovery period. File my 2011 taxes online free She uses Table 2-2a to find the percentage for Year 1 under “Half-year convention” (20%) to figure her depreciation deduction. File my 2011 taxes online free On May 1, Eileen paid $4,000 to have a furnace installed in the house. File my 2011 taxes online free The furnace is residential rental property. File my 2011 taxes online free Because she placed the property in service in May, the percentage from Table 2-2d is 2. File my 2011 taxes online free 273%. File my 2011 taxes online free Eileen figures her net rental income or loss for the house as follows: Total rental income received  ($750 × 11) $8,250 Minus: Expenses     Mortgage interest ($1,800 × 11/12) $1,650   Fire insurance ($100 × 11/12) 92   Miscellaneous repairs 297   Real estate taxes ($1,200 × 11/12) 1,100   Total expenses 3,139 Balance $5,111 Minus: Depreciation     House ($39,000 × . File my 2011 taxes online free 03182) $1,241   Dishwasher ($425 × . File my 2011 taxes online free 20) 85   Furnace ($4,000 × . File my 2011 taxes online free 02273) 91   Total depreciation 1,417 Net rental income for house   $3,694       Eileen uses Schedule E, Part I, to report her rental income and expenses. File my 2011 taxes online free She enters her income, expenses, and depreciation for the house in the column for Property A. File my 2011 taxes online free Since all property was placed in service this year, Eileen must use Form 4562 to figure the depreciation. File my 2011 taxes online free See the Instructions for Form 4562 for more information on preparing the form. File my 2011 taxes online free Prev  Up  Next   Home   More Online Publications