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Free 2011 Tax Filing

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Free 2011 Tax Filing

Free 2011 tax filing Publication 584 - Introductory Material Table of Contents What's New Introduction How To Use This Workbook What's New Future developments. Free 2011 tax filing  The IRS has created a page on IRS. Free 2011 tax filing gov for information about Publication 584, at www. Free 2011 tax filing irs. Free 2011 tax filing gov/pub584. Free 2011 tax filing Information about any future developments affecting Publication 584 (such as legislation enacted after we release it) will be posted on that page. Free 2011 tax filing Introduction This workbook is designed to help you figure your loss on personal-use property in the event of a disaster, casualty, or theft. Free 2011 tax filing It contains schedules to help you figure the loss to your main home, its contents, and your motor vehicles. Free 2011 tax filing However, these schedules are for your information only. Free 2011 tax filing You must complete Form 4684, Casualties and Thefts, to report your loss. Free 2011 tax filing How To Use This Workbook You can use this workbook by following these five steps. Free 2011 tax filing Read Publication 547 to learn about the tax rules for casualties, disasters, and thefts. Free 2011 tax filing Know the definitions of cost or other basis and fair market value, discussed later. Free 2011 tax filing Fill out Schedules 1 through 20. Free 2011 tax filing Read the instructions for Form 4684. Free 2011 tax filing Fill out Form 4684 using the information you entered in Schedules 1 through 20. Free 2011 tax filing Use the chart below to find out how to use Schedules 1 through 19 to fill out Form 4684. Free 2011 tax filing Take what's in each row of. Free 2011 tax filing . Free 2011 tax filing . Free 2011 tax filing And enter it on Form 4684. Free 2011 tax filing . Free 2011 tax filing . Free 2011 tax filing Column 1 Line 1 Column 2 Line 2 Column 3 Line 3 Column 4 Line 4 Column 5 Line 5 Column 6 Line 6 Column 7 Line 7 Column 8 Line 8 Column 9 Line 9 Prev  Up  Next   Home   More Online Publications
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Page Last Reviewed or Updated: 28-Mar-2014

The Free 2011 Tax Filing

Free 2011 tax filing 2. Free 2011 tax filing   Source of Income Table of Contents Introduction Topics - This chapter discusses: Resident Aliens Nonresident AliensInterest Income Dividends Guarantee of Indebtedness Personal Services Transportation Income Scholarships, Grants, Prizes, and Awards Pensions and Annuities Rents or Royalties Real Property Personal Property Community Income Introduction After you have determined your alien status, you must determine the source of your income. Free 2011 tax filing This chapter will help you determine the source of different types of income you may receive during the tax year. Free 2011 tax filing This chapter also discusses special rules for married individuals who are domiciled in a country with community property laws. Free 2011 tax filing Topics - This chapter discusses: Income source rules, and Community income. Free 2011 tax filing Resident Aliens A resident alien's income is generally subject to tax in the same manner as a U. Free 2011 tax filing S. Free 2011 tax filing citizen. Free 2011 tax filing If you are a resident alien, you must report all interest, dividends, wages, or other compensation for services, income from rental property or royalties, and other types of income on your U. Free 2011 tax filing S. Free 2011 tax filing tax return. Free 2011 tax filing You must report these amounts from sources within and outside the United States. Free 2011 tax filing Nonresident Aliens A nonresident alien usually is subject to U. Free 2011 tax filing S. Free 2011 tax filing income tax only on U. Free 2011 tax filing S. Free 2011 tax filing source income. Free 2011 tax filing Under limited circumstances, certain foreign source income is subject to U. Free 2011 tax filing S. Free 2011 tax filing tax. Free 2011 tax filing See Foreign Income in chapter 4. Free 2011 tax filing The general rules for determining U. Free 2011 tax filing S. Free 2011 tax filing source income that apply to most nonresident aliens are shown in Table 2-1. Free 2011 tax filing The following discussions cover the general rules as well as the exceptions to these rules. Free 2011 tax filing Not all items of U. Free 2011 tax filing S. Free 2011 tax filing source income are taxable. Free 2011 tax filing See chapter 3. Free 2011 tax filing Interest Income Generally, U. Free 2011 tax filing S. Free 2011 tax filing source interest income includes the following items. Free 2011 tax filing Interest on bonds, notes, or other interest-bearing obligations of U. Free 2011 tax filing S. Free 2011 tax filing residents or domestic corporations. Free 2011 tax filing Interest paid by a domestic or foreign partnership or foreign corporation engaged in a U. Free 2011 tax filing S. Free 2011 tax filing trade or business at any time during the tax year. Free 2011 tax filing Original issue discount. Free 2011 tax filing Interest from a state, the District of Columbia, or the U. Free 2011 tax filing S. Free 2011 tax filing Government. Free 2011 tax filing The place or manner of payment is immaterial in determining the source of the income. Free 2011 tax filing A substitute interest payment made to the transferor of a security in a securities lending transaction or a sale-repurchase transaction is sourced in the same manner as the interest on the transferred security. Free 2011 tax filing Exceptions. Free 2011 tax filing   U. Free 2011 tax filing S. Free 2011 tax filing source interest income does not include the following items. Free 2011 tax filing Interest paid by a resident alien or a domestic corporation on obligations issued before August 10, 2010, if for the 3-year period ending with the close of the payer's tax year preceding the interest payment, at least 80% of the payer's total gross income: Is from sources outside the United States, and Is attributable to the active conduct of a trade or business by the individual or corporation in a foreign country or a U. Free 2011 tax filing S. Free 2011 tax filing possession. Free 2011 tax filing However, the interest will be considered U. Free 2011 tax filing S. Free 2011 tax filing source interest income if either of the following apply. Free 2011 tax filing The recipient of the interest is related to the resident alien or domestic corporation. Free 2011 tax filing See section 954(d)(3) for the definition of related person. Free 2011 tax filing The terms of the obligation are significantly modified after August 9, 2010. Free 2011 tax filing Any extension of the term of the obligation is considered a significant modification. Free 2011 tax filing Interest paid by a foreign branch of a domestic corporation or a domestic partnership on deposits or withdrawable accounts with mutual savings banks, cooperative banks, credit unions, domestic building and loan associations, and other savings institutions chartered and supervised as savings and loan or similar associations under federal or state law if the interest paid or credited can be deducted by the association. Free 2011 tax filing Interest on deposits with a foreign branch of a domestic corporation or domestic partnership, but only if the branch is in the commercial banking business. Free 2011 tax filing Dividends In most cases, dividend income received from domestic corporations is U. Free 2011 tax filing S. Free 2011 tax filing source income. Free 2011 tax filing Dividend income from foreign corporations is usually foreign source income. Free 2011 tax filing Exceptions to both of these rules are discussed below. Free 2011 tax filing A substitute dividend payment made to the transferor of a security in a securities lending transaction or a sale-repurchase transaction is sourced in the same manner as a distribution on the transferred security. Free 2011 tax filing Dividend equivalent payments. Free 2011 tax filing   U. Free 2011 tax filing S. Free 2011 tax filing source dividends also include all dividend equivalent payments. Free 2011 tax filing Dividend equivalent payments include substitute dividends, payments made pursuant to a specified notional principal contract, and all similar payments that, directly or indirectly, are contingent on or determined by reference to, the payment of a dividend from U. Free 2011 tax filing S. Free 2011 tax filing sources. Free 2011 tax filing    The Internal Revenue Service has issued final regulations that would affect the treatment of dividend equivalent payments and specified notional principal contracts. Free 2011 tax filing You can view this regulation at www. Free 2011 tax filing irs. Free 2011 tax filing gov/irb/2013-52_IRB/ar08. Free 2011 tax filing html. Free 2011 tax filing First exception. Free 2011 tax filing   Dividends received from a domestic corporation are not U. Free 2011 tax filing S. Free 2011 tax filing source income if the corporation elects to take the American Samoa economic development credit. Free 2011 tax filing Second exception. Free 2011 tax filing   Part of the dividends received from a foreign corporation is U. Free 2011 tax filing S. Free 2011 tax filing source income if 25% or more of its total gross income for the 3-year period ending with the close of its tax year preceding the declaration of dividends was effectively connected with a trade or business in the United States. Free 2011 tax filing If the corporation was formed less than 3 years before the declaration, use its total gross income from the time it was formed. Free 2011 tax filing Determine the part that is U. Free 2011 tax filing S. Free 2011 tax filing source income by multiplying the dividend by the following fraction. Free 2011 tax filing   Foreign corporation's gross income connected with a U. Free 2011 tax filing S. Free 2011 tax filing trade or business for the 3-year period     Foreign corporation's gross income from all sources for that period   Guarantee of Indebtedness Certain amounts received directly or indirectly, for the provision of a guarantee of indebtedness issued after September 27, 2010, are U. Free 2011 tax filing S. Free 2011 tax filing source income. Free 2011 tax filing They must be paid by a noncorporate resident or U. Free 2011 tax filing S. Free 2011 tax filing corporation or by any foreign person if the amounts are effectively connected with the conduct of a U. Free 2011 tax filing S. Free 2011 tax filing trade or business. Free 2011 tax filing For more information, see Internal Revenue Code sections 861(a)(9) and 862(a)(9). Free 2011 tax filing Personal Services All wages and any other compensation for services performed in the United States are considered to be from sources in the United States. Free 2011 tax filing The only exceptions to this rule are discussed in chapter 3 under Employees of foreign persons, organizations, or offices, and under Crew members. Free 2011 tax filing If you are an employee and receive compensation for labor or personal services performed both inside and outside the United States, special rules apply in determining the source of the compensation. Free 2011 tax filing Compensation (other than certain fringe benefits) is sourced on a time basis. Free 2011 tax filing Certain fringe benefits (such as housing and education) are sourced on a geographical basis. Free 2011 tax filing Or, you may be permitted to use an alternative basis to determine the source of compensation. Free 2011 tax filing See Alternative Basis , later. Free 2011 tax filing Multi-level marketing. Free 2011 tax filing   Certain companies sell products through a multi-level marketing arrangement, such that an upper-tier distributor, who has sponsored a lower-tier distributor, is entitled to a payment from the company based on certain activities of that lower-tier distributor. Free 2011 tax filing Generally, depending on the facts, payments from such multi-level marketing companies to independent (non-employee) distributors (upper-tier distributors) that are based on the sales or purchases of persons whom they have sponsored (lower-tier distributors) constitute income for the performance of personal services in recruiting, training, and supporting the lower-tier distributors. Free 2011 tax filing The source of such income is generally based on where the services of the upper-tier distributor are performed, and may, depending on the facts, be considered multi-year compensation, with the source of income determined over the period to which such compensation is attributable. Free 2011 tax filing Self-employed individuals. Free 2011 tax filing   If you are self-employed, you determine the source of compensation for labor or personal services from self-employment on the basis that most correctly reflects the proper source of that income under the facts and circumstances of your particular case. Free 2011 tax filing In many cases, the facts and circumstances will call for an apportionment on a time basis as explained next. Free 2011 tax filing Time Basis Use a time basis to figure your U. Free 2011 tax filing S. Free 2011 tax filing source compensation (other than the fringe benefits discussed later). Free 2011 tax filing Do this by multiplying your total compensation (other than the fringe benefits discussed later) by the following fraction:   Number of days you performed services in the United States during the year     Total number of days you performed services during the year   You can use a unit of time less than a day in the above fraction, if appropriate. Free 2011 tax filing The time period for which the compensation is made does not have to be a year. Free 2011 tax filing Instead, you can use another distinct, separate, and continuous time period if you can establish to the satisfaction of the IRS that this other period is more appropriate. Free 2011 tax filing Example 1. Free 2011 tax filing Christina Brooks, a resident of the Netherlands, worked 240 days for a U. Free 2011 tax filing S. Free 2011 tax filing company during the tax year. Free 2011 tax filing She received $80,000 in compensation. Free 2011 tax filing None of it was for fringe benefits. Free 2011 tax filing Christina performed services in the United States for 60 days and performed services in the Netherlands for 180 days. Free 2011 tax filing Using the time basis for determining the source of compensation, $20,000 ($80,000 × 60/240) is her U. Free 2011 tax filing S. Free 2011 tax filing source income. Free 2011 tax filing Example 2. Free 2011 tax filing Rob Waters, a resident of South Africa, is employed by a corporation. Free 2011 tax filing His annual salary is $100,000. Free 2011 tax filing None of it is for fringe benefits. Free 2011 tax filing During the first quarter of the year he worked entirely within the United States. Free 2011 tax filing On April 1, Rob was transferred to Singapore for the remainder of the year. Free 2011 tax filing Rob is able to establish that the first quarter of the year and the last 3 quarters of the year are two separate, distinct, and continuous periods of time. Free 2011 tax filing Accordingly, $25,000 of Rob's annual salary is attributable to the first quarter of the year (. Free 2011 tax filing 25 × $100,000). Free 2011 tax filing All of it is U. Free 2011 tax filing S. Free 2011 tax filing source income because he worked entirely within the United States during that quarter. Free 2011 tax filing The remaining $75,000 is attributable to the last three quarters of the year. Free 2011 tax filing During those quarters, he worked 150 days in Singapore and 30 days in the United States. Free 2011 tax filing His periodic performance of services in the United States did not result in distinct, separate, and continuous periods of time. Free 2011 tax filing Of this $75,000, $12,500 ($75,000 × 30/180) is U. Free 2011 tax filing S. Free 2011 tax filing source income. Free 2011 tax filing Multi-year compensation. Free 2011 tax filing   The source of multi-year compensation is generally determined on a time basis over the period to which the compensation is attributable. Free 2011 tax filing Multi-year compensation is compensation that is included in your income in one tax year but that is attributable to a period that includes two or more tax years. Free 2011 tax filing   You determine the period to which the compensation is attributable based on the facts and circumstances of your case. Free 2011 tax filing For example, an amount of compensation that specifically relates to a period of time that includes several calendar years is attributable to the entire multi-year period. Free 2011 tax filing   The amount of compensation treated as from U. Free 2011 tax filing S. Free 2011 tax filing sources is figured by multiplying the total multi-year compensation by a fraction. Free 2011 tax filing The numerator of the fraction is the number of days (or unit of time less than a day, if appropriate) that you performed labor or personal services in the United States in connection with the project. Free 2011 tax filing The denominator of the fraction is the total number of days (or unit of time less than a day, if appropriate) that you performed labor or personal services in connection with the project. Free 2011 tax filing Geographical Basis Compensation you receive as an employee in the form of the following fringe benefits is sourced on a geographical basis. Free 2011 tax filing Housing. Free 2011 tax filing Education. Free 2011 tax filing Local transportation. Free 2011 tax filing Tax reimbursement. Free 2011 tax filing Hazardous or hardship duty pay as defined in Regulations section 1. Free 2011 tax filing 861-4(b)(2)(ii)(D)(5). Free 2011 tax filing Moving expense reimbursement. Free 2011 tax filing The amount of fringe benefits must be reasonable and you must substantiate them by adequate records or by sufficient evidence. Free 2011 tax filing Principal place of work. Free 2011 tax filing   The above fringe benefits, except for tax reimbursement and hazardous or hardship duty pay, are sourced based on your principal place of work. Free 2011 tax filing Your principal place of work is usually the place where you spend most of your working time. Free 2011 tax filing This could be your office, plant, store, shop, or other location. Free 2011 tax filing If there is no one place where you spend most of your working time, your main job location is the place where your work is centered, such as where you report for work or are otherwise required to “base” your work. Free 2011 tax filing   If you have more than one job at any time, your main job location depends on the facts in each case. Free 2011 tax filing The more important factors to be considered are: The total time you spend at each place, The amount of work you do at each place, and How much money you earn at each place. Free 2011 tax filing Housing. Free 2011 tax filing   The source of a housing fringe benefit is determined based on the location of your principal place of work. Free 2011 tax filing A housing fringe benefit includes payments to you or on your behalf (and your family's if your family resides with you) only for the following. Free 2011 tax filing Rent. Free 2011 tax filing Utilities (except telephone charges). Free 2011 tax filing Real and personal property insurance. Free 2011 tax filing Occupancy taxes not deductible under section 164 or 216(a). Free 2011 tax filing Nonrefundable fees for securing a leasehold. Free 2011 tax filing Rental of furniture and accessories. Free 2011 tax filing Household repairs. Free 2011 tax filing Residential parking. Free 2011 tax filing Fair rental value of housing provided in kind by your employer. Free 2011 tax filing   A housing fringe benefit does not include: Deductible interest and taxes (including deductible interest and taxes of a tenant-stockholder in a cooperative housing corporation), The cost of buying property, including principal payments on a mortgage, The cost of domestic labor (maids, gardeners, etc. Free 2011 tax filing ), Pay television subscriptions, Improvements and other expenses that increase the value or appreciably prolong the life of property, Purchased furniture or accessories, Depreciation or amortization of property or improvements, The value of meals or lodging that you exclude from gross income, or The value of meals or lodging that you deduct as moving expenses. Free 2011 tax filing Education. Free 2011 tax filing   The source of an education fringe benefit for the education expenses of your dependents is determined based on the location of your principal place of work. Free 2011 tax filing An education fringe benefit includes payments only for the following expenses for education at an elementary or secondary school. Free 2011 tax filing Tuition, fees, academic tutoring, special needs services for a special needs student, books, supplies, and other equipment. Free 2011 tax filing Room and board and uniforms that are required or provided by the school in connection with enrollment or attendance. Free 2011 tax filing Local transportation. Free 2011 tax filing   The source of a local transportation fringe benefit is determined based on the location of your principal place of work. Free 2011 tax filing Your local transportation fringe benefit is the amount that you receive as compensation for local transportation for you or your spouse or dependents at the location of your principal place of work. Free 2011 tax filing The amount treated as a local transportation fringe benefit is limited to actual expenses incurred for local transportation and the fair rental value of any employer-provided vehicle used predominantly by you, your spouse, or your dependents for local transportation. Free 2011 tax filing Actual expenses do not include the cost (including interest) of any vehicle purchased by you or on your behalf. Free 2011 tax filing Tax reimbursement. Free 2011 tax filing   The source of a tax reimbursement fringe benefit is determined based on the location of the jurisdiction that imposed the tax for which you are reimbursed. Free 2011 tax filing Moving expense reimbursement. Free 2011 tax filing   The source of a moving expense reimbursement is generally based on the location of your new principal place of work. Free 2011 tax filing However, the source is determined based on the location of your former principal place of work if you provide sufficient evidence that such determination of source is more appropriate under the facts and circumstances of your case. Free 2011 tax filing Sufficient evidence generally requires an agreement between you and your employer, or a written statement of company policy, which is reduced to writing before the move and which is entered into or established to induce you or other employees to move to another country. Free 2011 tax filing The written statement or agreement must state that your employer will reimburse you for moving expenses that you incur to return to your former principal place of work regardless of whether you continue to work for your employer after returning to that location. Free 2011 tax filing It may contain certain conditions upon which the right to reimbursement is determined as long as those conditions set forth standards that are definitely ascertainable and can only be fulfilled prior to, or through completion of, your return move to your former principal place of work. Free 2011 tax filing Alternative Basis If you are an employee, you can determine the source of your compensation under an alternative basis if you establish to the satisfaction of the IRS that, under the facts and circumstances of your case, the alternative basis more properly determines the source of your compensation than the time or geographical basis. Free 2011 tax filing If you use an alternative basis, you must keep (and have available for inspection) records to document why the alternative basis more properly determines the source of your compensation. Free 2011 tax filing Also, if your total compensation from all sources is $250,000 or more, check “Yes” to both questions on line K on page 5 of Form 1040NR, and attach a written statement to your tax return that sets forth all of the following. Free 2011 tax filing Your name and social security number (written across the top of the statement). Free 2011 tax filing The specific compensation income, or the specific fringe benefit, for which you are using the alternative basis. Free 2011 tax filing For each item in (2), the alternative basis of allocation of source used. Free 2011 tax filing For each item in (2), a computation showing how the alternative allocation was computed. Free 2011 tax filing A comparison of the dollar amount of the U. Free 2011 tax filing S. Free 2011 tax filing compensation and foreign compensation sourced under both the alternative basis and the time or geographical basis discussed earlier. Free 2011 tax filing Transportation Income Transportation income is income from the use of a vessel or aircraft or for the performance of services directly related to the use of any vessel or aircraft. Free 2011 tax filing This is true whether the vessel or aircraft is owned, hired, or leased. Free 2011 tax filing The term “vessel or aircraft” includes any container used in connection with a vessel or aircraft. Free 2011 tax filing All income from transportation that begins and ends in the United States is treated as derived from sources in the United States. Free 2011 tax filing If the transportation begins or ends in the United States, 50% of the transportation income is treated as derived from sources in the United States. Free 2011 tax filing For transportation income from personal services, 50% of the income is U. Free 2011 tax filing S. Free 2011 tax filing source income if the transportation is between the United States and a U. Free 2011 tax filing S. Free 2011 tax filing possession. Free 2011 tax filing For nonresident aliens, this only applies to income derived from, or in connection with, an aircraft. Free 2011 tax filing For information on how U. Free 2011 tax filing S. Free 2011 tax filing source transportation income is taxed, see chapter 4. Free 2011 tax filing Scholarships, Grants, Prizes, and Awards Generally, the source of scholarships, fellowship grants, grants, prizes, and awards is the residence of the payer regardless of who actually disburses the funds. Free 2011 tax filing However, see Activities to be performed outside the United States , later. Free 2011 tax filing For example, payments for research or study in the United States made by the United States, a noncorporate U. Free 2011 tax filing S. Free 2011 tax filing resident, or a domestic corporation, are from U. Free 2011 tax filing S. Free 2011 tax filing sources. Free 2011 tax filing Similar payments from a foreign government or foreign corporation are foreign source payments even though the funds may be disbursed through a U. Free 2011 tax filing S. Free 2011 tax filing agent. Free 2011 tax filing Payments made by an entity designated as a public international organization under the International Organizations Immunities Act are from foreign sources. Free 2011 tax filing Activities to be performed outside the United States. Free 2011 tax filing   Scholarships, fellowship grants, targeted grants, and achievement awards received by nonresident aliens for activities performed, or to be performed, outside the United States are not U. Free 2011 tax filing S. Free 2011 tax filing source income. Free 2011 tax filing    These rules do not apply to amounts paid as salary or other compensation for services. Free 2011 tax filing See Personal Services, earlier, for the source rules that apply. Free 2011 tax filing Pensions and Annuities If you receive a pension from a domestic trust for services performed both in and outside the United States, part of the pension payment is from U. Free 2011 tax filing S. Free 2011 tax filing sources. Free 2011 tax filing That part is the amount attributable to earnings of the pension plan and the employer contributions made for services performed in the United States. Free 2011 tax filing This applies whether the distribution is made under a qualified or nonqualified stock bonus, pension, profit-sharing, or annuity plan (whether or not funded). Free 2011 tax filing If you performed services as an employee of the United States, you may receive a distribution from the U. Free 2011 tax filing S. Free 2011 tax filing Government under a plan, such as the Civil Service Retirement System, that is treated as a qualified pension plan. Free 2011 tax filing Your U. Free 2011 tax filing S. Free 2011 tax filing source income is the otherwise taxable amount of the distribution that is attributable to your total U. Free 2011 tax filing S. Free 2011 tax filing Government basic pay other than tax-exempt pay for services performed outside the United States. Free 2011 tax filing Rents or Royalties Your U. Free 2011 tax filing S. Free 2011 tax filing source income includes rent and royalty income received during the tax year from property located in the United States or from any interest in that property. Free 2011 tax filing U. Free 2011 tax filing S. Free 2011 tax filing source income also includes rents or royalties for the use of, or for the privilege of using, in the United States, intangible property such as patents, copyrights, secret processes and formulas, goodwill, trademarks, franchises, and similar property. Free 2011 tax filing Real Property Real property is land and buildings and generally anything built on, growing on, or attached to land. Free 2011 tax filing Gross income from sources in the United States includes gains, profits, and income from the sale or other disposition of real property located in the United States. Free 2011 tax filing Natural resources. Free 2011 tax filing   The income from the sale of products of any farm, mine, oil or gas well, other natural deposit, or timber located in the United States and sold in a foreign country, or located in a foreign country and sold in the United States, is partly from sources in the United States. Free 2011 tax filing For information on determining that part, see section 1. Free 2011 tax filing 863-1(b) of the regulations. Free 2011 tax filing Table 2-1. Free 2011 tax filing Summary of Source Rules for Income of Nonresident Aliens Item of income Factor determining source Salaries, wages, other compensation Where services performed Business income:   Personal services Where services performed Sale of inventory—purchased Where sold Sale of inventory—produced Allocation Interest Residence of payer Dividends Whether a U. Free 2011 tax filing S. Free 2011 tax filing or foreign corporation* Rents Location of property Royalties:   Natural resources Location of property Patents, copyrights, etc. Free 2011 tax filing Where property is used Sale of real property Location of property Sale of personal property Seller's tax home (but see Personal Property , later, for exceptions) Pension distributions attributable to contributions Where services were performed that earned the pension Investment earnings on pension contributions Location of pension trust Sale of natural resources Allocation based on fair market value of product at export terminal. Free 2011 tax filing For more information, see section 1. Free 2011 tax filing 863-1(b) of the regulations. Free 2011 tax filing *Exceptions include: a) Dividends paid by a U. Free 2011 tax filing S. Free 2011 tax filing corporation are foreign source if the corporation elects the  American Samoa economic development credit. Free 2011 tax filing  b) Part of a dividend paid by a foreign corporation is U. Free 2011 tax filing S. Free 2011 tax filing source if at least 25% of the  corporation's gross income is effectively connected with a U. Free 2011 tax filing S. Free 2011 tax filing trade or business for the  3 tax years before the year in which the dividends are declared. Free 2011 tax filing Personal Property Personal property is property, such as machinery, equipment, or furniture, that is not real property. Free 2011 tax filing Gain or loss from the sale or exchange of personal property generally has its source in the United States if you have a tax home in the United States. Free 2011 tax filing If you do not have a tax home in the United States, the gain or loss generally is considered to be from sources outside the United States. Free 2011 tax filing Tax home. Free 2011 tax filing   Your tax home is the general area of your main place of business, employment, or post of duty, regardless of where you maintain your family home. Free 2011 tax filing Your tax home is the place where you permanently or indefinitely work as an employee or a self-employed individual. Free 2011 tax filing If you do not have a regular or main place of business because of the nature of your work, then your tax home is the place where you regularly live. Free 2011 tax filing If you do not fit either of these categories, you are considered an itinerant and your tax home is wherever you work. Free 2011 tax filing Inventory property. Free 2011 tax filing   Inventory property is personal property that is stock in trade or that is held primarily for sale to customers in the ordinary course of your trade or business. Free 2011 tax filing Income from the sale of inventory that you purchased is sourced where the property is sold. Free 2011 tax filing Generally, this is where title to the property passes to the buyer. Free 2011 tax filing For example, income from the sale of inventory in the United States is U. Free 2011 tax filing S. Free 2011 tax filing source income, whether you purchased it in the United States or in a foreign country. Free 2011 tax filing   Income from the sale of inventory property that you produced in the United States and sold outside the United States (or vice versa) is partly from sources in the United States and partly from sources outside the United States. Free 2011 tax filing For information on making this allocation, see section 1. Free 2011 tax filing 863-3 of the regulations. Free 2011 tax filing   These rules apply even if your tax home is not in the United States. Free 2011 tax filing Depreciable property. Free 2011 tax filing   To determine the source of any gain from the sale of depreciable personal property, you must first figure the part of the gain that is not more than the total depreciation adjustments on the property. Free 2011 tax filing You allocate this part of the gain to sources in the United States based on the ratio of U. Free 2011 tax filing S. Free 2011 tax filing depreciation adjustments to total depreciation adjustments. Free 2011 tax filing The rest of this part of the gain is considered to be from sources outside the United States. Free 2011 tax filing   For this purpose, “U. Free 2011 tax filing S. Free 2011 tax filing depreciation adjustments” are the depreciation adjustments to the basis of the property that are allowable in figuring taxable income from U. Free 2011 tax filing S. Free 2011 tax filing sources. Free 2011 tax filing However, if the property is used predominantly in the United States during a tax year, all depreciation deductions allowable for that year are treated as U. Free 2011 tax filing S. Free 2011 tax filing depreciation adjustments. Free 2011 tax filing But there are some exceptions for certain transportation, communications, and other property used internationally. Free 2011 tax filing   Gain from the sale of depreciable property that is more than the total depreciation adjustments on the property is sourced as if the property were inventory property, as discussed above. Free 2011 tax filing   A loss is sourced in the same way as the depreciation deductions were sourced. Free 2011 tax filing However, if the property was used predominantly in the United States, the entire loss reduces U. Free 2011 tax filing S. Free 2011 tax filing source income. Free 2011 tax filing   The basis of property usually means the cost (money plus the fair market value of other property or services) of property you acquire. Free 2011 tax filing Depreciation is an amount deducted to recover the cost or other basis of a trade or business asset. Free 2011 tax filing The amount you can deduct depends on the property's cost, when you began using the property, how long it will take to recover your cost, and which depreciation method you use. Free 2011 tax filing A depreciation deduction is any deduction for depreciation or amortization or any other allowable deduction that treats a capital expenditure as a deductible expense. Free 2011 tax filing Intangible property. Free 2011 tax filing   Intangible property includes patents, copyrights, secret processes or formulas, goodwill, trademarks, trade names, or other like property. Free 2011 tax filing The gain from the sale of amortizable or depreciable intangible property, up to the previously allowable amortization or depreciation deductions, is sourced in the same way as the original deductions were sourced. Free 2011 tax filing This is the same as the source rule for gain from the sale of depreciable property. Free 2011 tax filing See Depreciable property , earlier, for details on how to apply this rule. Free 2011 tax filing   Gain in excess of the amortization or depreciation deductions is sourced in the country where the property is used if the income from the sale is contingent on the productivity, use, or disposition of that property. Free 2011 tax filing If the income is not contingent on the productivity, use, or disposition of the property, the income is sourced according to your tax home as discussed earlier. Free 2011 tax filing If payments for goodwill do not depend on its productivity, use, or disposition, their source is the country in which the goodwill was generated. Free 2011 tax filing Sales through offices or fixed places of business. Free 2011 tax filing   Despite any of the earlier rules, if you do not have a tax home in the United States, but you maintain an office or other fixed place of business in the United States, treat the income from any sale of personal property (including inventory property) that is attributable to that office or place of business as U. Free 2011 tax filing S. Free 2011 tax filing source income. Free 2011 tax filing However, this rule does not apply to sales of inventory property for use, disposition, or consumption outside the United States if your office or other fixed place of business outside the United States materially participated in the sale. Free 2011 tax filing   If you have a tax home in the United States but maintain an office or other fixed place of business outside the United States, income from sales of personal property, other than inventory, depreciable property, or intangibles, that is attributable to that foreign office or place of business may be treated as U. Free 2011 tax filing S. Free 2011 tax filing source income. Free 2011 tax filing The income is treated as U. Free 2011 tax filing S. Free 2011 tax filing source income if an income tax of less than 10% of the income from the sale is paid to a foreign country. Free 2011 tax filing This rule also applies to losses if the foreign country would have imposed an income tax of less than 10% had the sale resulted in a gain. Free 2011 tax filing Community Income If you are married and you or your spouse is subject to the community property laws of a foreign country, a U. Free 2011 tax filing S. Free 2011 tax filing state, or a U. Free 2011 tax filing S. Free 2011 tax filing possession, you generally must follow those laws to determine the income of yourself and your spouse for U. Free 2011 tax filing S. Free 2011 tax filing tax purposes. Free 2011 tax filing But you must disregard certain community property laws if: Both you and your spouse are nonresident aliens, or One of you is a nonresident alien and the other is a U. Free 2011 tax filing S. Free 2011 tax filing citizen or resident and you do not both choose to be treated as U. Free 2011 tax filing S. Free 2011 tax filing residents as explained in chapter 1. Free 2011 tax filing In these cases, you and your spouse must report community income as explained later. Free 2011 tax filing Earned income. Free 2011 tax filing   Earned income of a spouse, other than trade or business income and a partner's distributive share of partnership income, is treated as the income of the spouse whose services produced the income. Free 2011 tax filing That spouse must report all of it on his or her separate return. Free 2011 tax filing Trade or business income. Free 2011 tax filing   Trade or business income, other than a partner's distributive share of partnership income, is treated as the income of the spouse carrying on the trade or business. Free 2011 tax filing That spouse must report all of it on his or her separate return. Free 2011 tax filing Partnership income (or loss). Free 2011 tax filing   A partner's distributive share of partnership income (or loss) is treated as the income (or loss) of the partner. Free 2011 tax filing The partner must report all of it on his or her separate return. Free 2011 tax filing Separate property income. Free 2011 tax filing   Income derived from the separate property of one spouse (and which is not earned income, trade or business income, or partnership distributive share income) is treated as the income of that spouse. Free 2011 tax filing That spouse must report all of it on his or her separate return. Free 2011 tax filing Use the appropriate community property law to determine what is separate property. Free 2011 tax filing Other community income. Free 2011 tax filing   All other community income is treated as provided by the applicable community property laws. Free 2011 tax filing Prev  Up  Next   Home   More Online Publications