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Filing 2011 Tax Return

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Filing 2011 Tax Return

Filing 2011 tax return 35. Filing 2011 tax return   Education Credits Table of Contents Introduction Useful Items - You may want to see: Who Can Claim an Education Credit Qualified Education ExpensesNo Double Benefit Allowed Adjustments to Qualified Education Expenses Introduction For 2013, there are two tax credits available to persons who pay expenses for higher (postsecondary) education. Filing 2011 tax return They are: The American opportunity credit, and The lifetime learning credit. Filing 2011 tax return The chapter will present an overview of these education credits. Filing 2011 tax return To get the detailed information you will need to claim either of the credits, and for examples illustrating that information, see chapters 2 and 3 of Publication 970. Filing 2011 tax return Can you claim more than one education credit this year?   For each student, you can choose for any year only one of the credits. Filing 2011 tax return For example, if you choose to take the American opportunity credit for a child on your 2013 tax return, you cannot, for that same child, also claim the lifetime learning credit for 2013. Filing 2011 tax return   If you are eligible to claim the American opportunity credit and you are also eligible to claim the lifetime learning credit for the same student in the same year, you can choose to claim either credit, but not both. Filing 2011 tax return   If you pay qualified education expenses for more than one student in the same year, you can choose to take the American opportunity and the lifetime learning credits on a per-student, per-year basis. Filing 2011 tax return This means that, for example, you can claim the American opportunity credit for one student and the lifetime learning credit for another student in the same year. Filing 2011 tax return Table 35-1. Filing 2011 tax return Comparison of Education Credits Caution. Filing 2011 tax return You can claim both the American opportunity credit and the lifetime learning credit on the same return—but not for the same student. Filing 2011 tax return   American Opportunity Credit Lifetime Learning Credit Maximum credit Up to $2,500 credit per eligible student Up to $2,000 credit per return Limit on modified adjusted gross income (MAGI) $180,000 if married filing jointly;  $90,000 if single, head of household, or qualifying widow(er) $127,000 if married filing jointly;  $63,000 if single, head of household, or qualifying widow(er) Refundable or nonrefundable 40% of credit may be refundable Credit limited to the amount of tax you must pay on your taxable income Number of years of postsecondary education Available ONLY if the student had not completed the first 4 years of postsecondary education before 2013 Available for all years of postsecondary education and for courses to acquire or improve job skills Number of tax years credit available Available ONLY for 4 tax years per eligible student (including any year(s) the Hope credit was claimed) Available for an unlimited number of years Type of program required Student must be pursuing a program leading to a degree or other recognized education credential Student does not need to be pursuing a program leading to a degree or other recognized education credential Number of courses Student must be enrolled at least half time for at least one academic period beginning during the tax year Available for one or more courses Felony drug conviction At the end of 2013, the student had not been convicted of a felony for possessing or distributing a controlled substance Felony drug convictions do not make the student ineligible Qualified expenses Tuition, required enrollment fees, and course materials that the student needs for a course of study whether or not the materials are bought at the educational institution as a condition of enrollment or attendance Tuition and fees required for enrollment or attendance (including amounts required to be paid to the institution for course-related books, supplies, and equipment) Payments for academic periods Payments made in 2013 for academic periods beginning in 2013 or beginning in the first 3 months of 2014 Differences between the American opportunity and lifetime learning credits. Filing 2011 tax return   There are several differences between these two credits. Filing 2011 tax return These differences are summarized in Table 35-1, later. Filing 2011 tax return Useful Items - You may want to see: Publication 970 Tax Benefits for Education Form (and Instructions) 8863 Education Credits (American Opportunity and Lifetime Learning Credits) Who Can Claim an Education Credit You may be able to claim an education credit if you, your spouse, or a dependent you claim on your tax return was a student enrolled at or attending an eligible educational institution. Filing 2011 tax return The credits are based on the amount of qualified education expenses paid for the student in 2013 for academic periods beginning in 2013 and in the first 3 months of 2014. Filing 2011 tax return For example, if you paid $1,500 in December 2013 for qualified tuition for the spring 2014 semester beginning in January 2014, you may be able to use that $1,500 in figuring your 2013 education credit(s). Filing 2011 tax return Academic period. Filing 2011 tax return   An academic period includes a semester, trimester, quarter, or other period of study (such as a summer school session) as reasonably determined by an educational institution. Filing 2011 tax return In the case of an educational institution that uses credit hours or clock hours and does not have academic terms, each payment period can be treated as an academic period. Filing 2011 tax return Eligible educational institution. Filing 2011 tax return   An eligible educational institution is any college, university, vocational school, or other postsecondary educational institution eligible to participate in a student aid program administered by the U. Filing 2011 tax return S. Filing 2011 tax return Department of Education. Filing 2011 tax return It includes virtually all accredited public, nonprofit, and proprietary (privately owned profit-making) postsecondary institutions. Filing 2011 tax return The educational institution should be able to tell you if it is an eligible educational institution. Filing 2011 tax return   Certain educational institutions located outside the United States also participate in the U. Filing 2011 tax return S. Filing 2011 tax return Department of Education's Federal Student Aid (FSA) programs. Filing 2011 tax return Who can claim a dependent's expenses. Filing 2011 tax return   If an exemption is allowed as a deduction for any person who claims the student as a dependent, all qualified education expenses of the student are treated as having been paid by that person. Filing 2011 tax return Therefore, only that person can claim an education credit for the student. Filing 2011 tax return If a student is not claimed as a dependent on another person's tax return, only the student can claim a credit. Filing 2011 tax return Expenses paid by a third party. Filing 2011 tax return   Qualified education expenses paid on behalf of the student by someone other than the student (such as a relative) are treated as paid by the student. Filing 2011 tax return However, qualified education expenses paid (or treated as paid) by a student who is claimed as a dependent on your tax return are treated as paid by you. Filing 2011 tax return Therefore, you are treated as having paid expenses that were paid by the third party. Filing 2011 tax return For more information and an example see Who Can Claim a Dependent's Expenses in Pub. Filing 2011 tax return 970, chapter 2 or 3. Filing 2011 tax return Who cannot claim a credit. Filing 2011 tax return   You cannot take an education credit if any of the following apply. Filing 2011 tax return You are claimed as a dependent on another person's tax return, such as your parent's return. Filing 2011 tax return Your filing status is married filing separately. Filing 2011 tax return You (or your spouse) were a nonresident alien for any part of 2013 and did not elect to be treated as a resident alien for tax purposes. Filing 2011 tax return Your MAGI is one of the following. Filing 2011 tax return American opportunity credit: $180,000 or more if married filing jointly, or $90,000 or more if single, head of household, or qualifying widow(er). Filing 2011 tax return Lifetime learning credit: $127,000 or more if married filing jointly, or $63,000 or more if single, head of household, or qualifying widow(er) . Filing 2011 tax return   Generally, your MAGI is the amount on your Form 1040, line 38, or Form 1040A, line 22. Filing 2011 tax return However, if you are filing Form 2555, Form 2555–EZ, or Form 4563, or are excluding income from Puerto RIco, add to the amount on your Form 1040, line 38, or Form 1040A, line 22, the amount of income you excluded. Filing 2011 tax return For details, see Pub. Filing 2011 tax return 970. Filing 2011 tax return    Figure 35-A may be helpful in determining if you can claim an education credit on your tax return. Filing 2011 tax return The American opportunity credit will always be greater than or equal to the lifetime learning credit for any student who is eligible for both credits. Filing 2011 tax return However, if any of the conditions for the American opportunity credit, listed in Table 35-1 earlier, are not met for any student, you cannot take the American opportunity credit for that student. Filing 2011 tax return You may be able to take the lifetime learning credit for part or all of that student's qualified education expenses instead. Filing 2011 tax return See Pub. Filing 2011 tax return 970 for information on other education benefits. Filing 2011 tax return Qualified Education Expenses Generally, qualified education expenses are amounts paid in 2013 for tuition and fees required for the student's enrollment or attendance at an eligible educational institution. Filing 2011 tax return It does not matter whether the expenses were paid in cash, by check, by credit or debit card, or with borrowed funds. Filing 2011 tax return For course-related books, supplies, and equipment, only certain expenses qualify. Filing 2011 tax return American opportunity credit: Qualified education expenses include amounts spent on books, supplies, and equipment needed for a course of study, whether or not the materials are purchased from the educational institution as a condition of enrollment or attendance. Filing 2011 tax return Lifetime learning credit: Qualified education expenses include amounts for books, supplies, and equipment only if required to be paid to the institution as a condition of enrollment or attendance. Filing 2011 tax return Qualified education expenses include nonacademic fees, such as student activity fees, athletic fees, or other expenses unrelated to the academic course of instruction, only if the fee must be paid to the institution as a condition of enrollment or attendance. Filing 2011 tax return However, fees for personal expenses (described below) are never qualified education expenses. Filing 2011 tax return Qualified education expenses for either credit do not include amounts paid for: Personal expenses. Filing 2011 tax return This means room and board, insurance, medical expenses (including student health fees), transportation, and other similar personal, living, or family expenses. Filing 2011 tax return Any course or other education involving sports, games, or hobbies, or any noncredit course, unless such course or other education is part of the student's degree program or (for the lifetime learning credit only) helps the student acquire or improve job skills. Filing 2011 tax return You should receive Form 1098–T, Tuition Statement, from the institution reporting either payments received in 2013 (box 1) or amounts billed in 2013 (box 2). Filing 2011 tax return However, the amount in box 1 or 2 of Form 1098–T may be different from the amount you paid (or are treated as having paid). Filing 2011 tax return In completing Form 8863, use only the amounts you actually paid (plus any amounts you are treated as having paid) in 2013, reduced as necessary, as described in Adjustments to Qualified Education Expenses , later. Filing 2011 tax return Qualified education expenses paid on behalf of the student by someone other than the student (such as a relative) are treated as paid by the student. Filing 2011 tax return Qualified education expenses paid (or treated as paid) by a student who is claimed as a dependent on your tax return are treated as paid by you. Filing 2011 tax return If you or the student takes a deduction for higher education expenses, such as on Schedule A or C (Form 1040), you cannot use those expenses in your qualified education expenses when figuring your education credits. Filing 2011 tax return Qualified education expenses for any academic period must be reduced by any tax-free educational assistance allocable to that academic period. Filing 2011 tax return See Adjustments to Qualified Education Expenses, later. Filing 2011 tax return Prepaid Expenses. Filing 2011 tax return   Qualified education expenses paid in 2013 for an academic period that begins in the first 3 months of 2014 can be used in figuring an education credit for 2013 only. Filing 2011 tax return See Academic period , earlier. Filing 2011 tax return For example, if you pay $2,000 in December 2013 for qualified tuition for the 2014 winter quarter that begins in January 2014, you can use that $2,000 in figuring an education credit for 2013 only (if you meet all the other requirements). Filing 2011 tax return    You cannot use any amount you paid in 2012 or 2014 to figure the qualified education expenses you use to figure your 2013 education credit(s). Filing 2011 tax return Paid with borrowed funds. Filing 2011 tax return   You can claim an education credit for qualified education expenses paid with the proceeds of a loan. Filing 2011 tax return Use the expenses to figure the credit for the year in which the expenses are paid, not the year in which the loan is repaid. Filing 2011 tax return Treat loan payments sent directly to the educational institution as paid on the date the institution credits the student's account. Filing 2011 tax return Student withdraws from class(es). Filing 2011 tax return   You can claim an education credit for qualified education expenses not refunded when a student withdraws. Filing 2011 tax return No Double Benefit Allowed You cannot do any of the following. Filing 2011 tax return Deduct higher education expenses on your income tax return (as, for example, a business expense) and also claim an education credit based on those same expenses. Filing 2011 tax return Claim more than one education credit based on the same qualified education expenses. Filing 2011 tax return Claim an education credit based on the same expenses used to figure the tax-free portion of a distribution from a Coverdell education savings account (ESA) or qualified tuition program (QTP). Filing 2011 tax return Claim an education credit based on qualified education expenses paid with educational assistance, such as a tax-free scholarship, grant, or employer-provided educational assistance. Filing 2011 tax return See Adjustments to Qualified Education Expenses, next. Filing 2011 tax return Adjustments to Qualified Education Expenses For each student, reduce the qualified education expenses paid in 2013 by or on behalf of that student under the following rules. Filing 2011 tax return The result is the amount of adjusted qualified education expenses for each student. Filing 2011 tax return Tax-free educational assistance. Filing 2011 tax return   For tax-free educational assistance received in 2013, reduce the qualified educational expenses for each academic period by the amount of tax-free educational assistance allocable to that academic period. Filing 2011 tax return See Academic period , earlier. Filing 2011 tax return      Tax-free educational assistance includes:    Tax-free parts of scholarships and fellowships (see chapter 12 of this publication and chapter 1 of Pub. Filing 2011 tax return 970), The tax-free part of Pell grants (see chapter 1 of Pub. Filing 2011 tax return 970), The tax-free part of employer-provided educational assistance (see Pub. Filing 2011 tax return 970), Veterans' educational assistance (see chapter 1 of Pub. Filing 2011 tax return 970), and Any other nontaxable (tax-free) payments (other than gifts or inheritances) received as educational assistance. Filing 2011 tax return Generally, any scholarship or fellowship is treated as tax-free educational assistance. Filing 2011 tax return However, a scholarship or fellowship is not treated as tax-free educational assistance to the extent the student includes it in gross income (if the student is required to file a tax return) for the year the scholarship or fellowship is received and either: The scholarship or fellowship (or any part of it) must be applied (by its terms) to expenses (such as room and board) other than qualified education expenses as defined in Qualified education expenses in Pub. Filing 2011 tax return 970, chapter 1; or The scholarship or fellowship (or any part of it) may be applied (by its terms) to expenses (such as room and board) other than qualified education expenses as defined in Qualified education expenses in Pub. Filing 2011 tax return 970, chapter 1. Filing 2011 tax return You may be able to increase the combined value of an education credit and certain educational assistance if the student includes some or all of the educational assistance in income in the year received. Filing 2011 tax return For details, see Adjustments of Qualified Education Expenses, in chapters 2 and 3 of Pub. Filing 2011 tax return 970. Filing 2011 tax return Some tax-free educational assistance received after 2013 may be treated as a refund of qualified education expenses paid in 2013. Filing 2011 tax return This tax-free educational assistance is any tax-free educational assistance received by you or anyone else after 2013 for qualified education expenses paid on behalf of a student in 2013 (or attributable to enrollment at an eligible educational institution during 2013). Filing 2011 tax return If this tax-free educational assistance is received after 2013 but before you file your 2013 income tax return, see Refunds received after 2013 but before your income tax return is filed, later. Filing 2011 tax return If this tax-free educational assistance is received after 2013 and after you file your 2013 income tax return, see Refunds received after 2013 and after your income tax return is filed, later. Filing 2011 tax return Refunds. Filing 2011 tax return   A refund of qualified education expenses may reduce qualified education expenses for the tax year or may require you to repay (recapture) the credit that you claimed in an earlier year. Filing 2011 tax return Some tax-free educational assistance received after 2013 may be treated as a refund. Filing 2011 tax return See Tax-free educational assistance, earlier. Filing 2011 tax return Refunds received in 2013. Filing 2011 tax return   For each student, figure the adjusted qualified education expenses for 2013 by adding all the qualified education expenses paid in 2013 and subtracting any refunds of those expenses received from the eligible educational institution during 2013. Filing 2011 tax return Refunds received after 2013 but before your income tax return is filed. Filing 2011 tax return   If anyone receives a refund after 2013 of qualified education expenses paid on behalf of a student in 2013 and the refund is received before you file your 2013 income tax return, reduce the amount of qualified education expenses for 2013 by the amount of the refund. Filing 2011 tax return Refunds received after 2013 and after your income tax return is filed. Filing 2011 tax return   If anyone receives a refund after 2013 of qualified education expenses paid on behalf of a student in 2013 and the refund is received after you file your 2013 income tax return, you may need to repay some or all of the credit that you claimed. Filing 2011 tax return See Credit recapture, next. Filing 2011 tax return Credit recapture. Filing 2011 tax return    If any tax-free educational assistance for the qualified education expenses paid in 2013, or any refund of your qualified education expenses paid in 2013, is received after you file your 2013 income tax return, you must recapture (repay) any excess credit. Filing 2011 tax return You do this by refiguring the amount of your adjusted qualified education expenses for 2013 by reducing the expenses by the amount of the refund or tax-free educational assistance. Filing 2011 tax return You then refigure your education credit(s) for 2013 and figure the amount by which your 2013 tax liability would have increased if you had claimed the refigured credit(s). Filing 2011 tax return Include that amount as an additional tax for the year the refund or tax-free assistance was received. Filing 2011 tax return Example. Filing 2011 tax return    You paid $8,000 tuition and fees in December 2013 for your child's Spring semester beginning in January 2014. Filing 2011 tax return You filed your 2013 tax return on February 3, 2014, and claimed a lifetime learning credit of $1,600 ($8,000 qualified education expense paid x . Filing 2011 tax return 20). Filing 2011 tax return You claimed no other tax credits. Filing 2011 tax return After you filed your return, your child withdrew from two courses and you received a refund of $1,400. Filing 2011 tax return You must refigure your 2013 lifetime learning credit using $6,600 ($8,000 qualified education expenses − $1,400 refund). Filing 2011 tax return The refigured credit is $1,320 and your tax liability increased by $280. Filing 2011 tax return You must include the difference of $280 ($1,600 credit originally claimed − $1,320 refigured credit) as additional tax on your 2014 income tax return. Filing 2011 tax return See the instructions for your 2014 income tax return to determine where to include this tax. Filing 2011 tax return If you also pay qualified education expenses in 2014 for an academic period that begins in the first 3 months of 2014 and you receive tax-free educational assistance, or a refund, as described above, you may choose to reduce your qualified education expenses for 2014 instead of reducing your expenses for 2013. Filing 2011 tax return Amounts that do not reduce qualified education expenses. Filing 2011 tax return   Do not reduce qualified education expenses by amounts paid with funds the student receives as: Payment for services, such as wages, A loan, A gift, An inheritance, or A withdrawal from the student's personal savings. Filing 2011 tax return   Do not reduce the qualified education expenses by any scholarship or fellowship reported as income on the student's tax return in the following situations. Filing 2011 tax return The use of the money is restricted, by the terms of the scholarship or fellowship, to costs of attendance (such as room and board) other than qualified education expenses, as defined in Chapter 1 of Pub. Filing 2011 tax return 970. Filing 2011 tax return The use of the money is not restricted. Filing 2011 tax return   For examples, see chapter 2 in Pub. Filing 2011 tax return 970. Filing 2011 tax return Figure 35-A. Filing 2011 tax return Can You Claim an Education Credit for 2013? This image is too large to be displayed in the current screen. Filing 2011 tax return Please click the link to view the image. Filing 2011 tax return Figure 35-A. Filing 2011 tax return Can You Claim an Education Credit for 2013? Prev  Up  Next   Home   More Online Publications

The Filing 2011 Tax Return

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