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How Do College Students File Taxes

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How Do College Students File Taxes

How do college students file taxes Publication 503 - Main Content Table of Contents Tests To Claim the CreditQualifying Person Test Earned Income Test Work-Related Expense Test Joint Return Test Provider Identification Test How To Figure the CreditFiguring Total Work-Related Expenses Earned Income Limit Dollar Limit Amount of Credit How To Claim the CreditTax credit not refundable. How do college students file taxes Employment Taxes for Household Employers How To Get Tax HelpLow Income Taxpayer Clinics Tests To Claim the Credit To be able to claim the credit for child and dependent care expenses, you must file Form 1040, Form 1040A, or Form 1040NR, not Form 1040EZ or Form 1040NR-EZ, and meet all the following tests. How do college students file taxes The care must be for one or more qualifying persons who are identified on Form 2441. How do college students file taxes (See Qualifying Person Test. How do college students file taxes ) You (and your spouse if filing jointly) must have earned income during the year. How do college students file taxes (However, see Rule for student-spouse or spouse not able to care for self under Earned Income Test, later. How do college students file taxes ) You must pay child and dependent care expenses so you (and your spouse if filing jointly) can work or look for work. How do college students file taxes (See Work-Related Expense Test, later. How do college students file taxes ) You must make payments for child and dependent care to someone you (and your spouse) cannot claim as a dependent. How do college students file taxes If you make payments to your child, he or she cannot be your dependent and must be age 19 or older by the end of the year. How do college students file taxes You cannot make payments to: Your spouse, or The parent of your qualifying person if your qualifying person is your child and under age 13. How do college students file taxes See Payments to Relatives or Dependents under Work-Related Expense Test, later. How do college students file taxes Your filing status may be single, head of household, or qualifying widow(er) with dependent child. How do college students file taxes If you are married, you must file a joint return, unless an exception applies to you. How do college students file taxes See Joint Return Test, later. How do college students file taxes You must identify the care provider on your tax return. How do college students file taxes (See Provider Identification Test, later. How do college students file taxes ) If you exclude or deduct dependent care benefits provided by a dependent care benefit plan, the total amount you exclude or deduct must be less than the dollar limit for qualifying expenses (generally, $3,000 if one qualifying person was cared for or $6,000 if two or more qualifying persons were cared for). How do college students file taxes (If two or more qualifying persons were cared for, the amount you exclude or deduct will always be less than the dollar limit, since the total amount you can exclude or deduct is limited to $5,000. How do college students file taxes See Reduced Dollar Limit under How To Figure the Credit, later. How do college students file taxes ) These tests are presented in Figure A and are also explained in detail in this publication. How do college students file taxes Qualifying Person Test Your child and dependent care expenses must be for the care of one or more qualifying persons. How do college students file taxes A qualifying person is: Your qualifying child who is your dependent and who was under age 13 when the care was provided (but see Child of divorced or separated parents or parents living apart , later), Your spouse who was not physically or mentally able to care for himself or herself and lived with you for more than half the year, or A person who was not physically or mentally able to care for himself or herself, lived with you for more than half the year, and either: Was your dependent, or Would have been your dependent except that: He or she received gross income of $3,900 or more, He or she filed a joint return, or You, or your spouse if filing jointly, could be claimed as a dependent on someone else's 2013 return. How do college students file taxes Dependent defined. How do college students file taxes   A dependent is a person, other than you or your spouse, for whom you can claim an exemption. How do college students file taxes To be your dependent, a person must be your qualifying child (or your qualifying relative). How do college students file taxes Qualifying child. How do college students file taxes   To be your qualifying child, a child must live with you for more than half the year and meet other requirements. How do college students file taxes More information. How do college students file taxes   For more information about who is a dependent or a qualifying child, see Publication 501. How do college students file taxes Physically or mentally not able to care for oneself. How do college students file taxes   Persons who cannot dress, clean, or feed themselves because of physical or mental problems are considered not able to care for themselves. How do college students file taxes Also, persons who must have constant attention to prevent them from injuring themselves or others are considered not able to care for themselves. How do college students file taxes Person qualifying for part of year. How do college students file taxes   You determine a person's qualifying status each day. How do college students file taxes For example, if the person for whom you pay child and dependent care expenses no longer qualifies on September 16, count only those expenses through September 15. How do college students file taxes Also see Yearly limit under Dollar Limit, later. How do college students file taxes Birth or death of otherwise qualifying person. How do college students file taxes   In determining whether a person is a qualifying person, a person who was born or died in 2013 is treated as having lived with you for more than half of 2013 if your home was the person's home more than half the time he or she was alive in 2013. How do college students file taxes Taxpayer identification number. How do college students file taxes   You must include on your return the name and taxpayer identification number (generally the social security number) of the qualifying person(s). How do college students file taxes If the correct information is not shown, the credit may be reduced or disallowed. How do college students file taxes Individual taxpayer identification number (ITIN) for aliens. How do college students file taxes   If your qualifying person is a nonresident or resident alien who does not have and cannot get a social security number (SSN), use that person's ITIN. How do college students file taxes The ITIN is entered wherever an SSN is requested on a tax return. How do college students file taxes If the alien does not have an ITIN, he or she must apply for one. How do college students file taxes See Form W-7, Application for IRS Individual Taxpayer Identification Number, for details. How do college students file taxes   An ITIN is for tax use only. How do college students file taxes It does not entitle the holder to social security benefits or change the holder's employment or immigration status under U. How do college students file taxes S. How do college students file taxes law. How do college students file taxes Adoption taxpayer identification number (ATIN). How do college students file taxes   If your qualifying person is a child who was placed in your home for adoption and for whom you do not have an SSN, you must get an ATIN for the child. How do college students file taxes File Form W-7A, Application for Taxpayer Identification Number for Pending U. How do college students file taxes S. How do college students file taxes Adoptions. How do college students file taxes Child of divorced or separated parents or parents living apart. How do college students file taxes   Even if you cannot claim your child as a dependent, he or she is treated as your qualifying person if: The child was under age 13 or was not physically or mentally able to care for himself or herself, The child received over half of his or her support during the calendar year from one or both parents who are divorced or legally separated under a decree of divorce or separate maintenance, are separated under a written separation agreement, or lived apart at all times during the last 6 months of the calendar year, The child was in the custody of one or both parents for more than half the year, and You were the child's custodial parent. How do college students file taxes   The custodial parent is the parent with whom the child lived for the greater number of nights in 2013. How do college students file taxes If the child was with each parent for an equal number of nights, the custodial parent is the parent with the higher adjusted gross income. How do college students file taxes For details and an exception for a parent who works at night, see Publication 501. How do college students file taxes   The noncustodial parent cannot treat the child as a qualifying person even if that parent is entitled to claim the child as a dependent under the special rules for a child of divorced or separated parents. How do college students file taxes Please click here for the text description of the image. How do college students file taxes Figure a. How do college students file taxes Can you claim the credit Earned Income Test To claim the credit, you (and your spouse if filing jointly) must have earned income during the year. How do college students file taxes Earned income. How do college students file taxes   Earned income includes wages, salaries, tips, other taxable employee compensation, and net earnings from self-employment. How do college students file taxes A net loss from self-employment reduces earned income. How do college students file taxes Earned income also includes strike benefits and any disability pay you report as wages. How do college students file taxes   Generally, only taxable compensation is included. How do college students file taxes However, you can elect to include nontaxable combat pay in earned income. How do college students file taxes If you are filing a joint return and both you and your spouse received nontaxable combat pay, you can each make your own election. How do college students file taxes (In other words, if one of you makes the election, the other one can also make it but does not have to. How do college students file taxes ) Including this income will give you a larger credit only if your (or your spouse's) other earned income is less than the amount entered on line 3 of Form 2441. How do college students file taxes You should figure your credit both ways and make the election if it gives you a greater tax benefit. How do college students file taxes    You can choose to include your nontaxable combat pay in earned income when figuring your credit for child and dependent care expenses, even if you choose not to include it in earned income for the earned income credit or the exclusion or deduction for dependent care benefits. How do college students file taxes Members of certain religious faiths opposed to social security. How do college students file taxes   This section is for persons who are members of certain religious faiths that are opposed to participation in Social Security Act programs and have an IRS-approved form that exempts certain income from social security and Medicare taxes. How do college students file taxes These forms are: Form 4361, Application for Exemption From Self-Employment Tax for Use by Ministers, Members of Religious Orders and Christian Science Practitioners, and Form 4029, Application for Exemption From Social Security and Medicare Taxes and Waiver of Benefits, for use by members of recognized religious groups. How do college students file taxes   Each form is discussed here in terms of what is or is not earned income for purposes of the child and dependent care credit. How do college students file taxes For information on the use of these forms, see Publication 517, Social Security and Other Information for Members of the Clergy and Religious Workers. How do college students file taxes Form 4361. How do college students file taxes   Whether or not you have an approved Form 4361, amounts you received for performing ministerial duties as an employee are earned income. How do college students file taxes This includes wages, salaries, tips, and other taxable employee compensation. How do college students file taxes   However, amounts you received for ministerial duties, but not as an employee, do not count as earned income. How do college students file taxes Examples include fees for performing marriages and honoraria for delivering speeches. How do college students file taxes   Any amount you received for work that is not related to your ministerial duties is earned income. How do college students file taxes Form 4029. How do college students file taxes   Whether or not you have an approved Form 4029, all wages, salaries, tips, and other taxable employee compensation are earned income. How do college students file taxes   However, amounts you received as a self-employed individual do not count as earned income. How do college students file taxes What is not earned income?   Earned income does not include: Pensions and annuities, Social security and railroad retirement benefits, Workers' compensation, Interest and dividends, Unemployment compensation, Scholarships or fellowship grants, except for those reported on Form W-2 and paid to you for teaching or other services, Nontaxable workfare payments, Child support payments received, Income of a nonresident alien that is not effectively connected with a U. How do college students file taxes S. How do college students file taxes trade or business, or Any amount received for work while an inmate in a penal institution. How do college students file taxes Rule for student-spouse or spouse not able to care for self. How do college students file taxes   Your spouse is treated as having earned income for any month that he or she is: A full-time student, or Physically or mentally not able to care for himself or herself. How do college students file taxes (Your spouse also must live with you for more than half the year. How do college students file taxes )   If you are filing a joint return, this rule also applies to you. How do college students file taxes You can be treated as having earned income for any month you are a full-time student or not able to care for yourself. How do college students file taxes   Figure the earned income of the nonworking spouse, described under (1) or (2) above, as shown under Earned Income Limit under How To Figure the Credit, later. How do college students file taxes   This rule applies to only one spouse for any one month. How do college students file taxes If, in the same month, both you and your spouse do not work and are either full-time students or not physically or mentally able to care for yourselves, only one of you can be treated as having earned income in that month. How do college students file taxes Full-time student. How do college students file taxes    You are a full-time student if you are enrolled at a school for the number of hours or classes that the school considers full time. How do college students file taxes You must have been a full-time student for some part of each of 5 calendar months during the year. How do college students file taxes (The months need not be consecutive. How do college students file taxes ) School. How do college students file taxes   The term “school” includes high schools, colleges, universities, and technical, trade, and mechanical schools. How do college students file taxes A school does not include an on-the-job training course, correspondence school, or school offering courses only through the Internet. How do college students file taxes Work-Related Expense Test Child and dependent care expenses must be work-related to qualify for the credit. How do college students file taxes Expenses are considered work-related only if both of the following are true. How do college students file taxes They allow you (and your spouse if filing jointly) to work or look for work. How do college students file taxes They are for a qualifying person's care. How do college students file taxes Working or Looking for Work To be work-related, your expenses must allow you to work or look for work. How do college students file taxes If you are married, generally both you and your spouse must work or look for work. How do college students file taxes One spouse is treated as working during any month he or she is a full-time student or is not physically or mentally able to care for himself or herself. How do college students file taxes Your work can be for others or in your own business or partnership. How do college students file taxes It can be either full time or part time. How do college students file taxes Work also includes actively looking for work. How do college students file taxes However, if you do not find a job and have no earned income for the year, you cannot take this credit. How do college students file taxes See Earned Income Test, earlier. How do college students file taxes An expense is not considered work-related merely because you had it while you were working. How do college students file taxes The purpose of the expense must be to allow you to work. How do college students file taxes Whether your expenses allow you to work or look for work depends on the facts. How do college students file taxes Example 1. How do college students file taxes The cost of a babysitter while you and your spouse go out to eat is not normally a work-related expense. How do college students file taxes Example 2. How do college students file taxes You work during the day. How do college students file taxes Your spouse works at night and sleeps during the day. How do college students file taxes You pay for care of your 5-year-old child during the hours when you are working and your spouse is sleeping. How do college students file taxes Your expenses are considered work-related. How do college students file taxes Volunteer work. How do college students file taxes   For this purpose, you are not considered to be working if you do unpaid volunteer work or volunteer work for a nominal salary. How do college students file taxes Work for part of year. How do college students file taxes   If you work or actively look for work during only part of the period covered by the expenses, then you must figure your expenses for each day. How do college students file taxes For example, if you work all year and pay care expenses of $250 a month ($3,000 for the year), all the expenses are work related. How do college students file taxes However, if you work or look for work for only 2 months and 15 days during the year and pay expenses of $250 a month, your work-related expenses are limited to $625 (2½ months × $250). How do college students file taxes Temporary absence from work. How do college students file taxes   You do not have to figure your expenses for each day during a short, temporary absence from work, such as for vacation or a minor illness, if you have to pay for care anyway. How do college students file taxes Instead, you can figure your credit including the expenses you paid for the period of absence. How do college students file taxes   An absence of 2 weeks or less is a short, temporary absence. How do college students file taxes An absence of more than 2 weeks may be considered a short, temporary absence, depending on the circumstances. How do college students file taxes Example. How do college students file taxes You pay a nanny to care for your 2-year-old son and 4-year-old daughter so you can work. How do college students file taxes You become ill and miss 4 months of work but receive sick pay. How do college students file taxes You continue to pay the nanny to care for the children while you are ill. How do college students file taxes Your absence is not a short, temporary absence, and your expenses are not considered work-related. How do college students file taxes Part-time work. How do college students file taxes   If you work part-time, you generally must figure your expenses for each day. How do college students file taxes However, if you have to pay for care weekly, monthly, or in another way that includes both days worked and days not worked, you can figure your credit including the expenses you paid for days you did not work. How do college students file taxes Any day when you work at least 1 hour is a day of work. How do college students file taxes Example 1. How do college students file taxes You work 3 days a week. How do college students file taxes While you work, your 6-year-old child attends a dependent care center, which complies with all state and local regulations. How do college students file taxes You can pay the center $150 for any 3 days a week or $250 for 5 days a week. How do college students file taxes Your child attends the center 5 days a week. How do college students file taxes Your work-related expenses are limited to $150 a week. How do college students file taxes Example 2. How do college students file taxes The facts are the same as in Example 1 except the center does not offer a 3-day option. How do college students file taxes The entire $250 weekly fee may be a work-related expense. How do college students file taxes Care of a Qualifying Person To be work-related, your expenses must be to provide care for a qualifying person. How do college students file taxes You do not have to choose the least expensive way of providing the care. How do college students file taxes The cost of a paid care provider may be an expense for the care of a qualifying person even if another care provider is available at no cost. How do college students file taxes Expenses are for the care of a qualifying person only if their main purpose is the person's well-being and protection. How do college students file taxes Expenses for household services qualify if part of the services is for the care of qualifying persons. How do college students file taxes See Household Services, later. How do college students file taxes Expenses not for care. How do college students file taxes   Expenses for care do not include amounts you pay for food, lodging, clothing, education, and entertainment. How do college students file taxes However, you can include small amounts paid for these items if they are incidental to and cannot be separated from the cost of caring for the qualifying person. How do college students file taxes Otherwise, see the discussion of Expenses partly work-related, later. How do college students file taxes   Child support payments are not for care and do not qualify for the credit. How do college students file taxes Education. How do college students file taxes   Expenses for a child in nursery school, preschool, or similar programs for children below the level of kindergarten are expenses for care. How do college students file taxes   Expenses to attend kindergarten or a higher grade are not expenses for care. How do college students file taxes Do not use these expenses to figure your credit. How do college students file taxes   However, expenses for before- or after-school care of a child in kindergarten or a higher grade may be expenses for care. How do college students file taxes   Summer school and tutoring programs are not for care. How do college students file taxes Example 1. How do college students file taxes You take your 3-year-old child to a nursery school that provides lunch and a few educational activities as part of its preschool childcare service. How do college students file taxes The lunch and educational activities are incidental to the childcare, and their cost cannot be separated from the cost of care. How do college students file taxes You can count the total cost when you figure the credit. How do college students file taxes Example 2. How do college students file taxes You place your 10-year-old child in a boarding school so you can work full time. How do college students file taxes Only the part of the boarding school expense that is for the care of your child is a work-related expense. How do college students file taxes You can count that part of the expense in figuring your credit if it can be separated from the cost of education. How do college students file taxes You cannot count any part of the amount you pay the school for your child's education. How do college students file taxes Care outside your home. How do college students file taxes   You can count the cost of care provided outside your home if the care is for your dependent under age 13 or any other qualifying person who regularly spends at least 8 hours each day in your home. How do college students file taxes Dependent care center. How do college students file taxes   You can count care provided outside your home by a dependent care center only if the center complies with all state and local regulations that apply to these centers. How do college students file taxes   A dependent care center is a place that provides care for more than six persons (other than persons who live there) and receives a fee, payment, or grant for providing services for any of those persons, even if the center is not run for profit. How do college students file taxes Camp. How do college students file taxes   The cost of sending your child to an overnight camp is not considered a work-related expense. How do college students file taxes    The cost of sending your child to a day camp may be a work-related expense, even if the camp specializes in a particular activity, such as computers or soccer. How do college students file taxes Transportation. How do college students file taxes   If a care provider takes a qualifying person to or from a place where care is provided, that transportation is for the care of the qualifying person. How do college students file taxes This includes transportation by bus, subway, taxi, or private car. How do college students file taxes However, transportation not provided by a care provider is not for the care of a qualifying person. How do college students file taxes Also, if you pay the transportation cost for the care provider to come to your home, that expense is not for care of a qualifying person. How do college students file taxes Fees and deposits. How do college students file taxes   Fees you paid to an agency to get the services of a care provider, deposits you paid to an agency or preschool, application fees, and other indirect expenses are work-related expenses if you have to pay them to get care, even though they are not directly for care. How do college students file taxes However, a forfeited deposit is not for the care of a qualifying person if care is not provided. How do college students file taxes Example 1. How do college students file taxes You paid a fee to an agency to get the services of the nanny who cares for your 2-year-old daughter while you work. How do college students file taxes The fee you paid is a work-related expense. How do college students file taxes Example 2. How do college students file taxes You placed a deposit with a preschool to reserve a place for your 3-year-old child. How do college students file taxes You later sent your child to a different preschool and forfeited the deposit. How do college students file taxes The forfeited deposit is not for care and so is not a work-related expense. How do college students file taxes Household Services Expenses you pay for household services meet the work-related expense test if they are at least partly for the well-being and protection of a qualifying person. How do college students file taxes Definition. How do college students file taxes   Household services are ordinary and usual services done in and around your home that are necessary to run your home. How do college students file taxes They include the services of a housekeeper, maid, or cook. How do college students file taxes However, they do not include the services of a chauffeur, bartender, or gardener. How do college students file taxes Housekeeper. How do college students file taxes   In this publication, the term housekeeper refers to any household employee whose services include the care of a qualifying person. How do college students file taxes Expenses partly work-related. How do college students file taxes   If part of an expense is work-related (for either household services or the care of a qualifying person) and part is for other purposes, you have to divide the expense. How do college students file taxes To figure your credit, count only the part that is work-related. How do college students file taxes However, you do not have to divide the expense if only a small part is for other purposes. How do college students file taxes Example. How do college students file taxes You pay a housekeeper to care for your 9-year-old and 15-year-old children so you can work. How do college students file taxes The housekeeper spends most of the time doing normal household work and spends 30 minutes a day driving you to and from work. How do college students file taxes You do not have to divide the expenses. How do college students file taxes You can treat the entire expense of the housekeeper as work-related because the time spent driving is minimal. How do college students file taxes Nor do you have to divide the expenses between the two children, even though the expenses are partly for the 15-year-old child who is not a qualifying person, because the expense is also partly for the care of your 9-year-old child, who is a qualifying person. How do college students file taxes However, the dollar limit (discussed later) is based on one qualifying person, not two. How do college students file taxes Meals and lodging provided for housekeeper. How do college students file taxes   If you have expenses for meals that your housekeeper eats in your home because of his or her employment, count these as work-related expenses. How do college students file taxes If you have extra expenses for providing lodging in your home to the housekeeper, count these as work-related expenses also. How do college students file taxes Example. How do college students file taxes To provide lodging to the housekeeper, you move to an apartment with an extra bedroom. How do college students file taxes You can count the extra rent and utility expenses for the housekeeper's bedroom as work-related. How do college students file taxes However, if your housekeeper moves into an existing bedroom in your home, you can count only the extra utility expenses as work-related. How do college students file taxes Taxes paid on wages. How do college students file taxes   The taxes you pay on wages for qualifying child and dependent care services are work-related expenses. How do college students file taxes For more information on a household employer's tax responsibilities, see Employment Taxes for Household Employers, later. How do college students file taxes Payments to Relatives or Dependents You can count work-related payments you make to relatives who are not your dependents, even if they live in your home. How do college students file taxes However, do not count any amounts you pay to: A dependent for whom you (or your spouse if filing jointly) can claim an exemption, Your child who was under age 19 at the end of the year, even if he or she is not your dependent, A person who was your spouse any time during the year, or The parent of your qualifying person if your qualifying person is your child and under age 13. How do college students file taxes Joint Return Test Generally, married couples must file a joint return to take the credit. How do college students file taxes However, if you are legally separated or living apart from your spouse, you may be able to file a separate return and still take the credit. How do college students file taxes Legally separated. How do college students file taxes   You are not considered married if you are legally separated from your spouse under a decree of divorce or separate maintenance. How do college students file taxes You may be eligible to take the credit on your return using head of household filing status. How do college students file taxes Married and living apart. How do college students file taxes   You are not considered married and are eligible to take the credit if all the following apply. How do college students file taxes You file a return apart from your spouse. How do college students file taxes Your home is the home of a qualifying person for more than half the year. How do college students file taxes You pay more than half the cost of keeping up your home for the year. How do college students file taxes Your spouse does not live in your home for the last 6 months of the year. How do college students file taxes Costs of keeping up a home. How do college students file taxes   The costs of keeping up a home normally include property taxes, mortgage interest, rent, utility charges, home repairs, insurance on the home, and food eaten at home. How do college students file taxes   The costs of keeping up a home do not include payments for clothing, education, medical treatment, vacations, life insurance, transportation, or mortgage principal. How do college students file taxes   They also do not include the purchase, permanent improvement, or replacement of property. How do college students file taxes For example, you cannot include the cost of replacing a water heater. How do college students file taxes However, you can include the cost of repairing a water heater. How do college students file taxes Death of spouse. How do college students file taxes   If your spouse died during the year and you do not remarry before the end of the year, you generally must file a joint return to take the credit. How do college students file taxes If you do remarry before the end of the year, the credit can be claimed on your deceased spouse's own return. How do college students file taxes Provider Identification Test You must identify all persons or organizations that provide care for your child or dependent. How do college students file taxes Use Form 2441, Part I, to show the information. How do college students file taxes If you do not have any care providers and you are filing Form 2441 only to report taxable income in Part III, enter “none” in line 1, column (a). How do college students file taxes Information needed. How do college students file taxes   To identify the care provider, you must give the provider's: Name, Address, and Taxpayer identification number. How do college students file taxes    If the care provider is an individual, the taxpayer identification number is his or her social security number or individual taxpayer identification number. How do college students file taxes If the care provider is an organization, then it is the employer identification number (EIN). How do college students file taxes   You do not have to show the taxpayer identification number if the care provider is a tax-exempt organization (such as a church or school). How do college students file taxes In this case, enter “Tax-Exempt” in the space where Form 2441 asks for the number. How do college students file taxes   If you cannot provide all of the information or the information is incorrect, you must be able to show that you used due diligence (discussed later) in trying to furnish the necessary information. How do college students file taxes Getting the information. How do college students file taxes    You can use Form W-10, Dependent Care Provider's Identification and Certification, to request the required information from the care provider. How do college students file taxes If you do not use Form W-10, you can get the information from one of the other sources listed in the instructions for Form W-10, including: A copy of the provider's social security card, A copy of the provider's completed Form W-4, Employee's Withholding Allowance Certificate, if he or she is your household employee, A copy of the statement furnished by your employer if the provider is your employer's dependent care plan, or A letter or invoice from the provider if it shows the necessary information. How do college students file taxes    You should keep this information with your tax records. How do college students file taxes Do not send Form W-10 (or other document containing this information) to the Internal Revenue Service. How do college students file taxes Due diligence. How do college students file taxes   If the care provider information you give is incorrect or incomplete, your credit may not be allowed. How do college students file taxes However, if you can show that you used due diligence in trying to supply the information, you can still claim the credit. How do college students file taxes   You can show due diligence by getting and keeping the provider's completed Form W-10 or one of the other sources of information just listed. How do college students file taxes Care providers can be penalized if they do not provide this information to you or if they provide incorrect information. How do college students file taxes Provider refusal. How do college students file taxes    If the provider refuses to give you the identifying information, you should report on Form 2441 whatever information you have (such as the name and address). How do college students file taxes Enter “See Attached Statement” in the columns calling for the information you do not have. How do college students file taxes Then attach a statement explaining that you requested the information from the care provider, but the provider did not give you the information. How do college students file taxes Be sure to write your name and social security number on this statement. How do college students file taxes The statement will show that you used due diligence in trying to furnish the necessary information. How do college students file taxes U. How do college students file taxes S. How do college students file taxes citizens and resident aliens living abroad. How do college students file taxes   If you are living abroad, your care provider may not have, and may not be required to get, a U. How do college students file taxes S. How do college students file taxes taxpayer identification number (for example, an SSN or an EIN). How do college students file taxes If so, enter “LAFCP” (Living Abroad Foreign Care Provider) in the space for the care provider's taxpayer identification number. How do college students file taxes How To Figure the Credit Your credit is a percentage of your work-related expenses. How do college students file taxes Your expenses are subject to the earned income limit and the dollar limit. How do college students file taxes The percentage is based on your adjusted gross income. How do college students file taxes Figuring Total Work-Related Expenses To figure the credit for 2013 work-related expenses, count only those you paid by December 31, 2013. How do college students file taxes Expenses prepaid in an earlier year. How do college students file taxes   If you pay for services before they are provided, you can count the prepaid expenses only in the year the care is received. How do college students file taxes Claim the expenses for the later year as if they were actually paid in that later year. How do college students file taxes Expenses not paid until the following year. How do college students file taxes   Do not count 2012 expenses that you paid in 2013 as work-related expenses for 2013. How do college students file taxes You may be able to claim an additional credit for them on your 2013 return, but you must figure it separately. How do college students file taxes See Payments for prior year's expenses under Amount of Credit, later. How do college students file taxes If you had expenses in 2013 that you did not pay until 2014, you cannot count them when figuring your 2013 credit. How do college students file taxes You may be able to claim a credit for them on your 2014 return. How do college students file taxes Expenses reimbursed. How do college students file taxes   If a state social services agency pays you a nontaxable amount to reimburse you for some of your child and dependent care expenses, you cannot count the expenses that are reimbursed as work-related expenses. How do college students file taxes Example. How do college students file taxes You paid work-related expenses of $3,000. How do college students file taxes You are reimbursed $2,000 by a state social services agency. How do college students file taxes You can use only $1,000 to figure your credit. How do college students file taxes Medical expenses. How do college students file taxes   Some expenses for the care of qualifying persons who are not able to care for themselves may qualify as work-related expenses and also as medical expenses. How do college students file taxes You can use them either way, but you cannot use the same expenses to claim both a credit and a medical expense deduction. How do college students file taxes   If you use these expenses to figure the credit and they are more than the earned income limit or the dollar limit, discussed later, you can add the excess to your medical expenses. How do college students file taxes However, if you use your total expenses to figure your medical expense deduction, you cannot use any part of them to figure your credit. How do college students file taxes For information on medical expenses, see Publication 502, Medical and Dental Expenses. How do college students file taxes    Amounts excluded from your income under your employer's dependent care benefits plan cannot be used to claim a medical expense deduction. How do college students file taxes Dependent Care Benefits If you receive dependent care benefits, your dollar limit for purposes of the credit may be reduced. How do college students file taxes See Reduced Dollar Limit, later. How do college students file taxes But, even if you cannot take the credit, you may be able to take an exclusion or deduction for the dependent care benefits. How do college students file taxes Dependent care benefits. How do college students file taxes    Dependent care benefits include: Amounts your employer paid directly to either you or your care provider for the care of your qualifying person while you work, The fair market value of care in a daycare facility provided or sponsored by your employer, and Pre-tax contributions you made under a dependent care flexible spending arrangement. How do college students file taxes Your salary may have been reduced to pay for these benefits. How do college students file taxes If you received benefits as an employee, they should be shown in box 10 of your Form W-2, Wage and Tax Statement. How do college students file taxes See Statement for employee, later. How do college students file taxes Benefits you received as a partner should be shown in box 13 of your Schedule K-1 (Form 1065) with code O. How do college students file taxes   Enter the amount of these benefits on Form 2441, Part III, line 12. How do college students file taxes Exclusion or deduction. How do college students file taxes   If your employer provides dependent care benefits under a qualified plan, you may be able to exclude these benefits from your income. How do college students file taxes Your employer can tell you whether your benefit plan qualifies. How do college students file taxes To claim the exclusion, you must complete Part III of Form 2441. How do college students file taxes You cannot use Form 1040EZ. How do college students file taxes   If you are self-employed and receive benefits from a qualified dependent care benefit plan, you are treated as both employer and employee. How do college students file taxes Therefore, you would not get an exclusion from wages. How do college students file taxes Instead, you would get a deduction on Form 1040, Schedule C, line 14; Schedule E, line 19 or 28; or Schedule F, line 15. How do college students file taxes To claim the deduction, you must use Form 2441. How do college students file taxes   The amount you can exclude or deduct is limited to the smallest of: The total amount of dependent care benefits you received during the year, The total amount of qualified expenses you incurred during the year, Your earned income, Your spouse's earned income, or $5,000 ($2,500 if married filing separately). How do college students file taxes   The definition of earned income for the exclusion or deduction is the same as the definition used when figuring the credit except that earned income for the exclusion or deduction does not include any dependent care benefits you receive. How do college students file taxes    You can choose to include your nontaxable combat pay in earned income when figuring your exclusion or deduction, even if you choose not to include it in earned income for the earned income credit or the credit for child and dependent care expenses. How do college students file taxes Statement for employee. How do college students file taxes   Your employer must give you a Form W-2 (or similar statement), showing in box 10 the total amount of dependent care benefits provided to you during the year under a qualified plan. How do college students file taxes Your employer will also include any dependent care benefits over $5,000 in your wages shown on your Form W-2 in box 1. How do college students file taxes Effect of exclusion on credit. How do college students file taxes   If you exclude dependent care benefits from your income, the amount of the excluded benefits: Is not included in your work-related expenses, and Reduces the dollar limit, discussed later. How do college students file taxes Earned Income Limit The amount of work-related expenses you use to figure your credit cannot be more than: Your earned income for the year, if you are single at the end of the year, or The smaller of your or your spouse's earned income for the year if you are married at the end of the year. How do college students file taxes Earned income for the purpose of figuring the credit is defined under Earned Income Test, earlier. How do college students file taxes For purposes of item (2), use your spouse's earned income for the entire year, even if you were married for only part of the year. How do college students file taxes Example. How do college students file taxes You remarried on December 3. How do college students file taxes Your earned income for the year was $18,000. How do college students file taxes Your new spouse's earned income for the year was $2,000. How do college students file taxes You paid work-related expenses of $3,000 for the care of your 5-year-old child and qualified to claim the credit. How do college students file taxes The amount of expenses you use to figure your credit cannot be more than $2,000 (the smaller of your earned income or that of your spouse). How do college students file taxes Separated spouse. How do college students file taxes   If you are legally separated or married and living apart from your spouse (as described under Joint Return Test, earlier), you are not considered married for purposes of the earned income limit. How do college students file taxes Use only your income in figuring the earned income limit. How do college students file taxes Surviving spouse. How do college students file taxes   If your spouse died during the year and you file a joint return as a surviving spouse, you may, but are not required to, take into account the earned income of your spouse who died during the year. How do college students file taxes Community property laws. How do college students file taxes   Disregard community property laws when you figure earned income for this credit. How do college students file taxes Self-employment earnings. How do college students file taxes   If you are self-employed, include your net earnings in earned income. How do college students file taxes For purposes of the child and dependent care credit, net earnings from self-employment generally means the amount from Schedule SE (either Section A or Section B), line 3, minus any deduction for self-employment tax on Form 1040 or Form 1040NR, line 27. How do college students file taxes Include your self-employment earnings in earned income, even if they are less than $400 and you did not file Schedule SE. How do college students file taxes Clergy or church employee. How do college students file taxes   If you are a member of the clergy or a church employee, see the Instructions for Form 2441 for details. How do college students file taxes Statutory employee. How do college students file taxes   If you filed Schedule C (Form 1040) or C-EZ (Form 1040) to report income as a statutory employee, also include as earned income the amount from line 1 of that Schedule C (Form 1040) or C-EZ (Form 1040). How do college students file taxes Net loss. How do college students file taxes   You must reduce your earned income by any net loss from self-employment. How do college students file taxes Optional method if earnings are low or a net loss. How do college students file taxes   If your net earnings from self-employment are low or you have a net loss, you may be able to figure your net earnings by using an optional method instead of the regular method. How do college students file taxes Get Publication 334, Tax Guide for Small Business, for details. How do college students file taxes If you use an optional method to figure net earnings for self-employment tax purposes, include those net earnings in your earned income for this credit. How do college students file taxes In this case, subtract any deduction you claimed on Form 1040 or Form 1040NR, line 27, from the total of the amounts on Schedule SE, Section B, lines 3 and 4b, to figure your net earnings. How do college students file taxes You or your spouse is a student or not able to care for self. How do college students file taxes   Your spouse who is either a full-time student or not able to care for himself or herself is treated as having earned income. How do college students file taxes His or her earned income for each month is considered to be at least $250 if there is one qualifying person in your home, or at least $500 if there are two or more. How do college students file taxes Spouse works. How do college students file taxes   If your spouse works during that month, use the higher of $250 (or $500) or his or her actual earned income for that month. How do college students file taxes Spouse qualifies for part of month. How do college students file taxes   If your spouse is a full-time student or not able to care for himself or herself for only part of a month, the full $250 (or $500) still applies for that month. How do college students file taxes You are a student or not able to care for self. How do college students file taxes   These rules also apply if you are a student or not able to care for yourself and are filing a joint return. How do college students file taxes For each month or part of a month you are a student or not able to care for yourself, your earned income is considered to be at least $250 (or $500). How do college students file taxes If you also work during that month, use the higher of $250 (or $500) or your actual earned income for that month. How do college students file taxes Both spouses qualify. How do college students file taxes   If, in the same month, both you and your spouse are either full-time students or not able to care for yourselves, only one spouse can be considered to have this earned income of $250 (or $500) for that month. How do college students file taxes Example. How do college students file taxes Jim works and keeps up a home for himself and his wife Sharon. How do college students file taxes Because of an accident, Sharon is not able to care for herself for 11 months during the tax year. How do college students file taxes During the 11 months, Jim pays $3,300 of work-related expenses for Sharon's care. How do college students file taxes These expenses also qualify as medical expenses. How do college students file taxes Their adjusted gross income is $29,000 and the entire amount is Jim's earned income. How do college students file taxes Jim and Sharon's earned income limit is the smallest of the following amounts. How do college students file taxes   Jim and Sharon's Earned Income Limit   1) Work-related expenses Jim paid $   3,300   2) Jim's earned income $   29,000   3) Income considered earned by Sharon (11 × $250) $    2,750   Jim and Sharon can use $2,750 to figure the credit and treat the balance of $550 ($3,300 − $2,750) as a medical expense. How do college students file taxes However, if they use the $3,300 first as a medical expense, they cannot use any part of that amount to figure the credit. How do college students file taxes Dollar Limit There is a dollar limit on the amount of your work-related expenses you can use to figure the credit. How do college students file taxes This limit is $3,000 for one qualifying person, or $6,000 for two or more qualifying persons. How do college students file taxes If you paid work-related expenses for the care of two or more qualifying persons, the applicable dollar limit is $6,000. How do college students file taxes This limit does not need to be divided equally among them. How do college students file taxes For example, if your work-related expenses for the care of one qualifying person are $3,200 and your work-related expenses for another qualifying person are $2,800, you can use the total, $6,000, when figuring the credit. How do college students file taxes Yearly limit. How do college students file taxes   The dollar limit is a yearly limit. How do college students file taxes The amount of the dollar limit remains the same no matter how long, during the year, you have a qualifying person in your household. How do college students file taxes Use the $3,000 limit if you paid work-related expenses for the care of one qualifying person at any time during the year. How do college students file taxes Use $6,000 if you paid work-related expenses for the care of more than one qualifying person at any time during the year. How do college students file taxes Example 1. How do college students file taxes You pay $500 a month for after-school care for your son. How do college students file taxes He turned 13 on May 1 and is no longer a qualifying person. How do college students file taxes You can use the $2,000 of expenses for his care January through April to figure your credit because it is not more than the $3,000 yearly limit. How do college students file taxes Example 2. How do college students file taxes In July of this year, to permit your spouse to begin a new job, you enrolled your 3-year-old daughter in a nursery school that provides preschool childcare. How do college students file taxes You paid $300 per month for the childcare. How do college students file taxes You can use the full $1,800 you paid ($300 × 6 months) as qualified expenses because it is not more than the $3,000 yearly limit. How do college students file taxes Reduced Dollar Limit If you received dependent care benefits that you exclude or deduct from your income, you must subtract that amount from the dollar limit that applies to you. How do college students file taxes Your reduced dollar limit is figured on Form 2441, Part III. How do college students file taxes See Dependent Care Benefits, earlier, for information on excluding or deducting these benefits. How do college students file taxes Example 1. How do college students file taxes George is a widower with one child and earns $24,000 a year. How do college students file taxes He pays work-related expenses of $2,900 for the care of his 4-year-old child and qualifies to claim the credit for child and dependent care expenses. How do college students file taxes His employer pays an additional $1,000 under a qualified dependent care benefit plan. How do college students file taxes This $1,000 is excluded from George's income. How do college students file taxes Although the dollar limit for his work-related expenses is $3,000 (one qualifying person), George figures his credit on only $2,000 of the $2,900 work-related expenses he paid. How do college students file taxes This is because his dollar limit is reduced as shown next. How do college students file taxes   George's Reduced Dollar Limit 1) Maximum allowable expenses for one qualifying person $3,000 2) Minus: Dependent care benefits George excludes from income −1,000 3) Reduced dollar limit on expenses George can use for the credit $2,000 Example 2. How do college students file taxes Randall is married and both he and his wife are employed. How do college students file taxes Each has earned income in excess of $6,000. How do college students file taxes They have two children, Anne and Andy, ages 2 and 4, who attend a daycare facility licensed and regulated by the state. How do college students file taxes Randall's work-related expenses are $6,000 for the year. How do college students file taxes Randall's employer has a dependent care assistance program as part of its cafeteria plan, which allows employees to make pre-tax contributions to a dependent care flexible spending arrangement. How do college students file taxes Randall has elected to take the maximum $5,000 exclusion from his salary to cover dependent care expenses through this program. How do college students file taxes Although the dollar limit for his work-related expenses is $6,000 (two or more qualifying persons), Randall figures his credit on only $1,000 of the $6,000 work-related expense paid. How do college students file taxes This is because his dollar limit is reduced as shown next. How do college students file taxes   Randall's Reduced Dollar Limit 1) Maximum allowable expenses for two qualifying persons $6,000 2) Minus: Dependent care benefits selected from employer's cafeteria plan and  excluded from Randall's income −5,000 3) Reduced dollar limit on work-related expenses Randall can use for the credit $1,000 Amount of Credit To determine the amount of your credit, multiply your work-related expenses (after applying the earned income and dollar limits) by a percentage. How do college students file taxes This percentage depends on your adjusted gross income shown on Form 1040, line 38; Form 1040A, line 22; or Form 1040NR, line 37. How do college students file taxes The following table shows the percentage to use based on adjusted gross income. How do college students file taxes   IF your adjusted gross income is: THEN the       Over:       But not over:   percentage is:       $0   —   $15,000   35%       15,000   —   17,000   34%       17,000   —   19,000   33%       19,000   —   21,000   32%       21,000   —   23,000   31%       23,000   —   25,000   30%       25,000   —   27,000   29%       27,000   —   29,000   28%       29,000   —   31,000   27%       31,000   —   33,000   26%       33,000   —   35,000   25%       35,000   —   37,000   24%       37,000   —   39,000   23%       39,000   —   41,000   22%       41,000   —   43,000   21%       43,000   —   No limit   20%   To qualify for the credit, you must have one or more qualifying persons. How do college students file taxes You should show the expenses for each person on Form 2441, line 2, column (c). How do college students file taxes However, it is possible a qualifying person could have no expenses and a second qualifying person could have expenses exceeding $3,000. How do college students file taxes You should list -0- for the one person and the actual amount for the second person. How do college students file taxes The $6,000 limit that applies to two or more qualifying persons would still be used to compute your credit unless you already excluded or deducted, in Part III of Form 2441, certain dependent care benefits paid to you (or on your behalf) by your employer. How do college students file taxes Example. How do college students file taxes Roger and Megan Paris have two qualifying children. How do college students file taxes They received $1,000 of dependent care benefits from Megan's employer during 2013, but they incurred a total of $19,500 of child and dependent care expenses. How do college students file taxes They complete Part III of Form 2441 to exclude the $1,000 from their taxable income (offsetting $1,000 of their expenses). How do college students file taxes Roger and Megan continue to line 27 to figure their credit using the remaining $18,500 of expenses. How do college students file taxes Line 30 tells them to complete line 2 without including any dependent care benefits. How do college students file taxes They complete line 2 of Form 2441, listing both Susan and James, as shown in the Line 2 example above. How do college students file taxes Line 2 Example (a) Qualifying person's name (b) Qualifying person's social security number (c) Qualified expenses you incurred and paid in 2013 for the person listed in column (a) First Last Susan Paris 123-00-6789 -0- James Paris 987-00-4321 18,500. How do college students file taxes 00 All of Susan's expenses were covered by the $1,000 of employer-provided dependent care benefits. How do college students file taxes However, their son James has special needs and they paid $18,500 for his care. How do college students file taxes Line 3 imposes a $5,000 limit for two or more children ($6,000 limit, minus $1,000 already excluded from income = $5,000) and Roger and Megan continue to complete the form. How do college students file taxes Even though line 2 indicates one of the Paris children did not have any dependent care expenses, it does not change the fact that they had two qualifying children for the purposes of Form 2441. How do college students file taxes Payments for prior year's expenses. How do college students file taxes   If you had work-related expenses in 2012 that you paid in 2013, you may be able to increase the credit on your 2013 return. How do college students file taxes Attach a statement to your form showing how you figured the additional amount from 2012. How do college students file taxes Then enter “CPYE” (Credit for Prior Year Expenses) and the amount of the credit on the dotted line next to line 9 on Form 2441. How do college students file taxes Also enter the name and taxpayer identification number of the person for whom you paid the prior year's expenses. How do college students file taxes Then add this credit to the amount on line 9, and replace the amount on line 9 with the total. How do college students file taxes See Worksheet A. How do college students file taxes Example. How do college students file taxes In 2012, Sam and Kate had childcare expenses of $2,600 for their 12-year-old child. How do college students file taxes Of the $2,600, they paid $2,000 in 2012 and $600 in 2013. How do college students file taxes Their adjusted gross income for 2012 was $30,000. How do college students file taxes Sam's earned income of $14,000 was less than Kate's earned income. How do college students file taxes A credit for their 2012 expenses paid in 2013 is not allowed in 2012. How do college students file taxes It is allowed for the 2013 tax year, but they must use their adjusted gross income for 2012 to compute the amount. How do college students file taxes The filled-in Worksheet A they used to figure this credit is shown later. How do college students file taxes Sam and Kate add the $162 from line 13 of this worksheet to their 2013 credit and enter the total on their Form 2441, line 9. How do college students file taxes They enter “CPYE $162” and their child's name and SSN in the space to the left of line 9. How do college students file taxes Worksheet A. How do college students file taxes Worksheet for 2012 Expenses Paid in 2013 Use this worksheet to figure the credit you may claim for 2012 expenses paid in 2013. How do college students file taxes 1. How do college students file taxes   Enter your 2012 qualified expenses paid in 2012 1. How do college students file taxes     2. How do college students file taxes   Enter your 2012 qualified expenses paid in 2013 2. How do college students file taxes     3. How do college students file taxes   Add the amounts on lines 1 and 2 3. How do college students file taxes     4. How do college students file taxes   Enter $3,000 if care was for one qualifying person ($6,000 if for two or more) 4. How do college students file taxes     5. How do college students file taxes   Enter any dependent care benefits received for 2012 and excluded from your income (from your 2012 Form 2441, line 25) 5. How do college students file taxes     6. How do college students file taxes   Subtract the amount on line 5 from the amount on line 4 and enter the result 6. How do college students file taxes     7. How do college students file taxes   Compare your earned income for 2012 and your spouse's earned income for 2012 and enter the smaller amount 7. How do college students file taxes     8. How do college students file taxes   Compare the amounts on lines 3, 6, and 7 and enter the smallest amount 8. How do college students file taxes     9. How do college students file taxes   Enter the amount on which you figured the credit for 2012 (from your 2012 Form 2441, line 6) 9. How do college students file taxes     10. How do college students file taxes   Subtract the amount on line 9 from the amount on line 8 and enter the result. How do college students file taxes If zero or less, stop here. How do college students file taxes You cannot increase your 2013 credit by any previous year's expenses 10. How do college students file taxes     11. How do college students file taxes   Enter your 2012 adjusted gross income (from your 2012 Form 1040, line 38; Form 1040A, line 22; or Form 1040NR, line 37) 11. How do college students file taxes     12. How do college students file taxes   Find your 2012 adjusted gross income in the table below and enter the corresponding decimal amount here 12. How do college students file taxes             IF your 2012 adjusted gross income is:   THEN the decimal                 Over:   But not over:     amount is:                 $0 — $15,000     . How do college students file taxes 35                 15,000 — 17,000     . How do college students file taxes 34                 17,000 — 19,000     . How do college students file taxes 33                 19,000 — 21,000     . How do college students file taxes 32                 21,000 — 23,000     . How do college students file taxes 31                 23,000 — 25,000     . How do college students file taxes 30                 25,000 — 27,000     . How do college students file taxes 29                 27,000 — 29,000     . How do college students file taxes 28                 29,000 — 31,000     . How do college students file taxes 27                 31,000 — 33,000     . How do college students file taxes 26                 33,000 — 35,000     . How do college students file taxes 25                 35,000 — 37,000     . How do college students file taxes 24                 37,000 — 39,000     . How do college students file taxes 23                 39,000 — 41,000     . How do college students file taxes 22                 41,000 — 43,000     . How do college students file taxes 21                 43,000 — No limit     . How do college students file taxes 20           13. How do college students file taxes   Multiply line 10 by line 12. How do college students file taxes Add this amount to your 2013 credit and enter the total on your 2013 Form 2441, line 9. How do college students file taxes Enter the following on the dotted line next to line 9 of Form 2441: “CPYE” The amount of this credit for a prior year's expenses           Also, attach a statement to your tax return showing the name and taxpayer identification number of the person for whom you paid the prior year's expenses and how you figured the credit 13. How do college students file taxes       Worksheet A. How do college students file taxes Filled-in Worksheet for 2012 Expenses Paid in 2013 Use this worksheet to figure the credit you may claim for 2012 expenses paid in 2013. How do college students file taxes 1. How do college students file taxes   Enter your 2012 qualified expenses paid in 2012 1. How do college students file taxes   $2,000 2. How do college students file taxes   Enter your 2012 qualified expenses paid in 2013 2. How do college students file taxes   600 3. How do college students file taxes   Add the amounts on lines 1 and 2 3. How do college students file taxes   2,600 4. How do college students file taxes   Enter $3,000 if care was for one qualifying person ($6,000 if for two or more) 4. How do college students file taxes   3,000 5. How do college students file taxes   Enter any dependent care benefits received for 2012 and excluded from your income (from your 2012 Form 2441, line 25) 5. How do college students file taxes   0 6. How do college students file taxes   Subtract the amount on line 5 from the amount on line 4 and enter the result 6. How do college students file taxes   3,000 7. How do college students file taxes   Compare your earned income for 2012 and your spouse's earned income for 2012 and enter the smaller amount 7. How do college students file taxes   14,000 8. How do college students file taxes   Compare the amounts on lines 3, 6, and 7 and enter the smallest amount 8. How do college students file taxes   2,600 9. How do college students file taxes   Enter the amount on which you figured the credit for 2012 (from your 2012 Form 2441, line 6) 9. How do college students file taxes   2,000 10. How do college students file taxes   Subtract the amount on line 9 from the amount on line 8 and enter the result. How do college students file taxes If zero or less, stop here. How do college students file taxes You cannot increase your 2013 credit by any previous year's expenses 10. How do college students file taxes   600 11. How do college students file taxes   Enter your 2012 adjusted gross income (from your 2012 Form 1040, line 38; Form 1040A, line 22; or Form 1040NR, line 37) 11. How do college students file taxes   30,000 12. How do college students file taxes   Find your 2012 adjusted gross income in the table below and enter the corresponding decimal amount here 12. How do college students file taxes   . How do college students file taxes 27         IF your 2012 adjusted gross income is:   THEN the decimal                 Over   But not over     amount is:                 $0 — $15,000     . How do college students file taxes 35                 15,000 — 17,000     . How do college students file taxes 34                 17,000 — 19,000     . How do college students file taxes 33                 19,000 — 21,000     . How do college students file taxes 32                 21,000 — 23,000     . How do college students file taxes 31                 23,000 — 25,000     . How do college students file taxes 30                 25,000 — 27,000     . How do college students file taxes 29                 27,000 — 29,000     . How do college students file taxes 28                 29,000 — 31,000     . How do college students file taxes 27                 31,000 — 33,000     . How do college students file taxes 26                 33,000 — 35,000     . How do college students file taxes 25                 35,000 — 37,000     . How do college students file taxes 24                 37,000 — 39,000     . How do college students file taxes 23                 39,000 — 41,000     . How do college students file taxes 22                 41,000 — 43,000     . How do college students file taxes 21                 43,000 — No limit     . How do college students file taxes 20           13. How do college students file taxes   Multiply line 10 by line 12. How do college students file taxes Add this amount to your 2013 credit and enter the total on your 2013 Form 2441, line 9. How do college students file taxes Enter the following on the dotted line next to line 9 of Form 2441: “CPYE” The amount of this credit for a prior year's expenses             Also, attach a statement to your tax return showing the name and taxpayer identification number of the person for whom you paid the prior year's expenses and how you figured the credit 13. How do college students file taxes   $162   How To Claim the Credit To claim the credit, you can file Form 1040, Form 1040A, or Form 1040NR. How do college students file taxes You cannot claim the credit on Form 1040EZ or Form 1040NR-EZ. How do college students file taxes Form 1040, Form 1040A, or Form 1040NR. How do college students file taxes    You must complete Form 2441 and attach it to your Form 1040, Form 1040A, or Form 1040NR. How do college students file taxes Enter the credit on your Form 1040, line 48; Form 1040A, line 29; or Form 1040NR, line 46. How do college students file taxes Limit on credit. How do college students file taxes    The amount of credit you can claim is limited to your tax. How do college students file taxes For more information, see the Instructions for Form 2441. How do college students file taxes Tax credit not refundable. How do college students file taxes   You cannot get a refund for any part of the credit that is more than this limit. How do college students file taxes Recordkeeping. How do college students file taxes You should keep records of your work-related expenses. How do college students file taxes Also, if your dependent or spouse is not able to care for himself or herself, your records should show both the nature and length of the disability. How do college students file taxes Other records you should keep to support your claim for the credit are described under Provider Identification Test, earlier. How do college students file taxes Employment Taxes for Household Employers If you pay someone to come to your home and care for your dependent or spouse, you may be a household employer. How do college students file taxes If you are a household employer, you will need an employer identification number (EIN) and you may have to pay employment taxes. How do college students file taxes If the individuals who work in your home are self-employed, you are not liable for any of the taxes discussed in this section. How do college students file taxes Self-employed persons who are in business for themselves are not household employees. How do college students file taxes Usually, you are not a household employer if the person who cares for your dependent or spouse does so at his or her home or place of business. How do college students file taxes If you use a placement agency that exercises control over what work is done and how it will be done by a babysitter or companion who works in your home, the worker is not your employee. How do college students file taxes This control could include providing rules of conduct and appearance and requiring regular reports. How do college students file taxes In this case, you do not have to pay employment taxes. How do college students file taxes But, if an agency merely gives you a list of sitters and you hire one from that list, and pay the sitter directly, the sitter may be your employee. How do college students file taxes If you have a household employee, you may be subject to: Social security and Medicare taxes, Federal unemployment tax, and Federal income tax withholding. How do college students file taxes Social security and Medicare taxes are generally withheld from the employee's pay and matched by the employer. How do college students file taxes Federal unemployment (FUTA) tax is paid by the employer only and provides for payments of unemployment compensation to workers who have lost their jobs. How do college students file taxes Federal income tax is withheld from the employee's total pay if the employee asks you to do so and you agree. How do college students file taxes For more information on a household employer's tax responsibilities, see Publication 926 and Schedule H (Form 1040) and its instructions. How do college students file taxes State employment tax. How do college students file taxes   You may also have to pay state unemployment tax. How do college students file taxes Contact your state unemployment tax office for information. How do college students file taxes You should also find out whether you need to pay or collect other state employment taxes or carry worker's compensation insurance. How do college students file taxes For a list of state unemployment tax agencies, visit the U. How do college students file taxes S. How do college students file taxes Department of Labor's website. How do college students file taxes To find that website, use the link in Publication 926 or search online. How do college students file taxes How To Get Tax Help Whether it's help with a tax issue, preparing your tax return or a need for a free publication or form, get the help you need the way you want it: online, use a smart phone, call or walk in to an IRS office or volunteer site near you. How do college students file taxes Free help with your tax return. How do college students file taxes   You can get free help preparing your return nationwide from IRS-certified volunteers. How do college students file taxes The Volunteer Income Tax Assistance (VITA) program helps low-to-moderate income, elderly, people with disabilities, and limited English proficient taxpayers. How do college students file taxes The Tax Counseling for the Elderly (TCE) program helps taxpayers age 60 and older with their tax returns. How do college students file taxes Most VITA and TCE sites offer free electronic filing and all volunteers will let you know about credits and deductions you may be entitled to claim. How do college students file taxes In addition, some VITA and TCE sites provide taxpayers the opportunity to prepare their own return with help from an IRS-certified volunteer. How do college students file taxes To find the nearest VITA or TCE site, you can use the VITA Locator Tool on IRS. How do college students file taxes gov, download the IRS2Go app, or call 1-800-906-9887. How do college students file taxes   As part of the TCE program, AARP offers the Tax-Aide counseling program. How do college students file taxes To find the nearest AARP Tax-Aide site, visit AARP's website at www. How do college students file taxes aarp. How do college students file taxes org/money/taxaide or call 1-888-227-7669. How do college students file taxes For more information on these programs, go to IRS. How do college students file taxes gov and enter “VITA” in the search box. How do college students file taxes Internet. How do college students file taxes    IRS. How do college students file taxes gov and IRS2Go are ready when you are —24 hours a day, 7 days a week. How do college students file taxes Download the free IRS2Go app from the iTunes app store or from Google Play. How do college students file taxes Use it to check your refund status, order transcripts of your tax returns or tax account, watch the IRS YouTube channel, get IRS news as soon as it's released to the public, subscribe to filing season updates or daily tax tips, and follow the IRS Twitter news feed, @IRSnews, to get the latest federal tax news, including information about tax law changes and important IRS programs. How do college students file taxes Check the status of your 2013 refund with the Where's My Refund? application on IRS. How do college students file taxes gov or download the IRS2Go app and select the Refund Status option. How do college students file taxes The IRS issues more than 9 out of 10 refunds in less than 21 days. How do college students file taxes Using these applications, you can start checking on the status of your return within 24 hours after we receive your e-filed return or 4 weeks after you mail a paper return. How do college students file taxes You will also be given a personalized refund date as soon as the IRS processes your tax return and approves your refund. How do college students file taxes The IRS updates Where's My Refund? every 24 hours, usually overnight, so you only need to check once a day. How do college students file taxes Use the Interactive Tax Assistant (ITA) to research your tax questions. How do college students file taxes No need to wait on the phone or stand in line. How do college students file taxes The ITA is available 24 hours a day, 7 days a week, and provides you with a variety of tax information related to general filing topics, deductions, credits, and income. How do college students file taxes When you reach the response screen, you can print the entire interview and the final response for your records. How do college students file taxes New subject areas are added on a regular basis. How do college students file taxes  Answers not provided through ITA may be found in Tax Trails, one of the Tax Topics on IRS. How do college students file taxes gov which contain general individual and business tax information or by searching the IRS Tax Map, which includes an international subject index. How do college students file taxes You can use the IRS Tax Map, to search publications and instructions by topic or keyword. How do college students file taxes The IRS Tax Map integrates forms and publications into one research tool and provides single-point access to tax law information by subject. How do college students file taxes When the user searches the IRS Tax Map, they will be provided with links to related content in existing IRS publications, forms and instructions, questions and answers, and Tax Topics. How do college students file taxes Coming this filing season, you can immediately view and print for free all 5 types of individual federal tax transcripts (tax returns, tax account, record of account, wage and income statement, and certification of non-filing) using Get Transcript. How do college students file taxes You can also ask the IRS to mail a return or an account transcript to you. How do college students file taxes Only the mail option is available by choosing the Tax Records option on the IRS2Go app by selecting Mail Transcript on IRS. How do college students file taxes gov or by calling 1-800-908-9946. How do college students file taxes Tax return and tax account transcripts are generally available for the current year and the past three years. How do college students file taxes Determine if you are eligible for the EITC and estimate the amount of the credit with the Earned Income Tax Credit (EITC) Assistant. How do college students file taxes Visit Understanding Your IRS Notice or Letter to get answers to questions about a notice or letter you received from the IRS. How do college students file taxes If you received the First Time Homebuyer Credit, you can use the First Time Homebuyer Credit Account Look-up tool for information on your repayments and account balance. How do college students file taxes Check the status of your amended return using Where's My Amended Return? Go to IRS. How do college students file taxes gov and enter Where's My Amended Return? in the search box. How do college students file taxes You can generally expect your amended return to be processed up to 12 weeks from the date we receive it. How do college students file taxes It can take up to 3 weeks from the date you mailed it to show up in our system. How do college students file taxes Make a payment using one of several safe and convenient electronic payment options available on IRS. How do college students file taxes gov. How do college students file taxes Select the Payment tab on the front page of IRS. How do college students file taxes gov for more information. How do college students file taxes Determine if you are eligible and apply for an online payment agreement, if you owe more tax than you can pay today. How do college students file taxes Figure your income tax withholding with the IRS Withholding Calculator on IRS. How do college students file taxes gov. How do college students file taxes Use it if you've had too much or too little withheld, your personal situation has changed, you're starting a new job or you just want to see if you're having the right amount withheld. How do college students file taxes Determine if you might be subject to the Alternative Minimum Tax by using the Alternative Minimum Tax Assistant on IRS. How do college students file taxes gov. How do college students file taxes Request an Electronic Filing PIN by going to IRS. How do college students file taxes gov and entering Electronic Filing PIN in the search box. How do college students file taxes Download forms, instructions and publications, including accessible versions for people with disabilities. How do college students file taxes Locate the nearest Taxpayer Assistance Center (TAC) using the Office Locator tool on IRS. How do college students file taxes gov, or choose the Contact Us option on the IRS2Go app and search Local Offices. How do college students file taxes An employee can answer questions about your tax account or help you set up a payment plan. How do college students file taxes Before you visit, check the Office Locator on IRS. How do college students file taxes gov, or Local Offices under Contact Us on IRS2Go to confirm the address, phone number, days and hours of operation, and the services provided. How do college students file taxes If you have a special need, such as a disability, you can request an appointment. How do college students file taxes Call the local number listed in the Office Locator, or look in the phone book under Unit
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How do college students file taxes 2. How do college students file taxes   Entertainment Table of Contents Directly-Related Test Associated TestMeetings at conventions. How do college students file taxes 50% LimitExceptions to the 50% Limit What Entertainment Expenses Are Deductible?A meal as a form of entertainment. How do college students file taxes Deduction may depend on your type of business. How do college students file taxes Exception for events that benefit charitable organizations. How do college students file taxes Food and beverages in skybox seats. How do college students file taxes What Entertainment Expenses Are Not Deductible?Out-of-pocket expenses. How do college students file taxes You may be able to deduct business-related entertainment expenses you have for entertaining a client, customer, or employee. How do college students file taxes The rules and definitions are summarized in Table 2-1 . How do college students file taxes You can deduct entertainment expenses only if they are both ordinary and necessary and meet one of the following tests. How do college students file taxes Directly-related test. How do college students file taxes Associated test. How do college students file taxes Both of these tests are explained later. How do college students file taxes An ordinary expense is one that is common and accepted in your trade or business. How do college students file taxes A necessary expense is one that is helpful and appropriate for your business. How do college students file taxes An expense does not have to be required to be considered necessary. How do college students file taxes The amount you can deduct for entertainment expenses may be limited. How do college students file taxes Generally, you can deduct only 50% of your unreimbursed entertainment expenses. How do college students file taxes This limit is discussed later under 50% Limit. How do college students file taxes Directly-Related Test To meet the directly-related test for entertainment expenses (including entertainment-related meals), you must show that: The main purpose of the combined business and entertainment was the active conduct of business, You did engage in business with the person during the entertainment period, and You had more than a general expectation of getting income or some other specific business benefit at some future time. How do college students file taxes Business is generally not considered to be the main purpose when business and entertainment are combined on hunting or fishing trips, or on yachts or other pleasure boats. How do college students file taxes Even if you show that business was the main purpose, you generally cannot deduct the expenses for the use of an entertainment facility. How do college students file taxes See Entertainment facilities under What Entertainment Expenses Are Not Deductible? later in this chapter. How do college students file taxes You must consider all the facts, including the nature of the business transacted and the reasons for conducting business during the entertainment. How do college students file taxes It is not necessary to devote more time to business than to entertainment. How do college students file taxes However, if the business discussion is only incidental to the entertainment, the entertainment expenses do not meet the directly-related test. How do college students file taxes Table 2-1. How do college students file taxes When Are Entertainment Expenses Deductible? General rule You can deduct ordinary and necessary expenses to entertain a client, customer, or employee if the expenses meet the directly-related test or the associated test. How do college students file taxes Definitions Entertainment includes any activity generally considered to provide entertainment, amusement, or recreation, and includes meals provided to a customer or client. How do college students file taxes An ordinary expense is one that is common and accepted in your trade or business. How do college students file taxes A necessary expense is one that is helpful and appropriate. How do college students file taxes Tests to be met Directly-related test Entertainment took place in a clear business setting, or Main purpose of entertainment was the active conduct of business, and You did engage in business with the person during the entertainment period, and You had more than a general expectation of getting income or some other specific business benefit. How do college students file taxes   Associated test Entertainment is associated with your trade or business, and Entertainment is directly before or after a substantial business discussion. How do college students file taxes Other rules You cannot deduct the cost of your meal as an entertainment expense if you are claiming the meal as a travel expense. How do college students file taxes You cannot deduct expenses that are lavish or extravagant under the circumstances. How do college students file taxes You generally can deduct only 50% of your unreimbursed entertainment expenses (see 50% Limit ). How do college students file taxes You do not have to show that business income or other business benefit actually resulted from each entertainment expense. How do college students file taxes Clear business setting. How do college students file taxes   If the entertainment takes place in a clear business setting and is for your business or work, the expenses are considered directly related to your business or work. How do college students file taxes The following situations are examples of entertainment in a clear business setting. How do college students file taxes Entertainment in a hospitality room at a convention where business goodwill is created through the display or discussion of business products. How do college students file taxes Entertainment that is mainly a price rebate on the sale of your products (such as a restaurant owner providing an occasional free meal to a loyal customer). How do college students file taxes Entertainment of a clear business nature occurring under circumstances where there is no meaningful personal or social relationship between you and the persons entertained. How do college students file taxes An example is entertainment of business and civic leaders at the opening of a new hotel or play when the purpose is to get business publicity rather than to create or maintain the goodwill of the persons entertained. How do college students file taxes Expenses not considered directly related. How do college students file taxes   Entertainment expenses generally are not considered directly related if you are not there or in situations where there are substantial distractions that generally prevent you from actively conducting business. How do college students file taxes The following are examples of situations where there are substantial distractions. How do college students file taxes A meeting or discussion at a nightclub, theater, or sporting event. How do college students file taxes A meeting or discussion during what is essentially a social gathering, such as a cocktail party. How do college students file taxes A meeting with a group that includes persons who are not business associates at places such as cocktail lounges, country clubs, golf clubs, athletic clubs, or vacation resorts. How do college students file taxes Associated Test Even if your expenses do not meet the directly-related test, they may meet the associated test. How do college students file taxes To meet the associated test for entertainment expenses (including entertainment-related meals), you must show that the entertainment is: Associated with the active conduct of your trade or business, and Directly before or after a substantial business discussion (defined later). How do college students file taxes Associated with trade or business. How do college students file taxes   Generally, an expense is associated with the active conduct of your trade or business if you can show that you had a clear business purpose for having the expense. How do college students file taxes The purpose may be to get new business or to encourage the continuation of an existing business relationship. How do college students file taxes Substantial business discussion. How do college students file taxes   Whether a business discussion is substantial depends on the facts of each case. How do college students file taxes A business discussion will not be considered substantial unless you can show that you actively engaged in the discussion, meeting, negotiation, or other business transaction to get income or some other specific business benefit. How do college students file taxes   The meeting does not have to be for any specified length of time, but you must show that the business discussion was substantial in relation to the meal or entertainment. How do college students file taxes It is not necessary that you devote more time to business than to entertainment. How do college students file taxes You do not have to discuss business during the meal or entertainment. How do college students file taxes Meetings at conventions. How do college students file taxes   You are considered to have a substantial business discussion if you attend meetings at a convention or similar event, or at a trade or business meeting sponsored and conducted by a business or professional organization. How do college students file taxes However, your reason for attending the convention or meeting must be to further your trade or business. How do college students file taxes The organization that sponsors the convention or meeting must schedule a program of business activities that is the main activity of the convention or meeting. How do college students file taxes Directly before or after business discussion. How do college students file taxes   If the entertainment is held on the same day as the business discussion, it is considered to be held directly before or after the business discussion. How do college students file taxes   If the entertainment and the business discussion are not held on the same day, you must consider the facts of each case to see if the associated test is met. How do college students file taxes Among the facts to consider are the place, date, and duration of the business discussion. How do college students file taxes If you or your business associates are from out of town, you must also consider the dates of arrival and departure, and the reasons the entertainment and the discussion did not take place on the same day. How do college students file taxes Example. How do college students file taxes A group of business associates comes from out of town to your place of business to hold a substantial business discussion. How do college students file taxes If you entertain those business guests on the evening before the business discussion, or on the evening of the day following the business discussion, the entertainment generally is considered to be held directly before or after the discussion. How do college students file taxes The expense meets the associated test. How do college students file taxes 50% Limit In general, you can deduct only 50% of your business-related meal and entertainment expenses. How do college students file taxes (If you are subject to the Department of Transportation's “hours of service” limits, you can deduct 80% of your business-related meal and entertainment expenses. How do college students file taxes See Individuals subject to “hours of service” limits , later. How do college students file taxes ) The 50% limit applies to employees or their employers, and to self-employed persons (including independent contractors) or their clients, depending on whether the expenses are reimbursed. How do college students file taxes Figure A summarizes the general rules explained in this section. How do college students file taxes The 50% limit applies to business meals or entertainment expenses you have while: Traveling away from home (whether eating alone or with others) on business, Entertaining customers at your place of business, a restaurant, or other location, or Attending a business convention or reception, business meeting, or business luncheon at a club. How do college students file taxes Included expenses. How do college students file taxes   Expenses subject to the 50% limit include: Taxes and tips relating to a business meal or entertainment activity, Cover charges for admission to a nightclub, Rent paid for a room in which you hold a dinner or cocktail party, and Amounts paid for parking at a sports arena. How do college students file taxes However, the cost of transportation to and from a business meal or a business-related entertainment activity is not subject to the 50% limit. How do college students file taxes Figure A. How do college students file taxes Does the 50% Limit Apply to Your Expenses? There are exceptions to these rules. How do college students file taxes See Exceptions to the 50% Limit . How do college students file taxes Please click here for the text description of the image. How do college students file taxes Figure A. How do college students file taxes Does the 50% limit apply to Your Expenses?TAs for Figure A are: Notice 87-23; Form 2106 instructions Application of 50% limit. How do college students file taxes   The 50% limit on meal and entertainment expenses applies if the expense is otherwise deductible and is not covered by one of the exceptions discussed later. How do college students file taxes   The 50% limit also applies to certain meal and entertainment expenses that are not business related. How do college students file taxes It applies to meal and entertainment expenses you have for the production of income, including rental or royalty income. How do college students file taxes It also applies to the cost of meals included in deductible educational expenses. How do college students file taxes When to apply the 50% limit. How do college students file taxes   You apply the 50% limit after determining the amount that would otherwise qualify for a deduction. How do college students file taxes You first have to determine the amount of meal and entertainment expenses that would be deductible under the other rules discussed in this publication. How do college students file taxes Example 1. How do college students file taxes You spend $200 for a business-related meal. How do college students file taxes If $110 of that amount is not allowable because it is lavish and extravagant, the remaining $90 is subject to the 50% limit. How do college students file taxes Your deduction cannot be more than $45 (50% × $90). How do college students file taxes Example 2. How do college students file taxes You purchase two tickets to a concert and give them to a client. How do college students file taxes You purchased the tickets through a ticket agent. How do college students file taxes You paid $200 for the two tickets, which had a face value of $80 each ($160 total). How do college students file taxes Your deduction cannot be more than $80 (50% × $160). How do college students file taxes Exceptions to the 50% Limit Generally, business-related meal and entertainment expenses are subject to the 50% limit. How do college students file taxes Figure A can help you determine if the 50% limit applies to you. How do college students file taxes Expenses not subject to 50% limit. How do college students file taxes   Your meal or entertainment expense is not subject to the 50% limit if the expense meets one of the following exceptions. How do college students file taxes 1 - Employee's reimbursed expenses. How do college students file taxes   If you are an employee, you are not subject to the 50% limit on expenses for which your employer reimburses you under an accountable plan. How do college students file taxes Accountable plans are discussed in chapter 6. How do college students file taxes 2 - Self-employed. How do college students file taxes   If you are self-employed, your deductible meal and entertainment expenses are not subject to the 50% limit if all of the following requirements are met. How do college students file taxes You have these expenses as an independent contractor. How do college students file taxes Your customer or client reimburses you or gives you an allowance for these expenses in connection with services you perform. How do college students file taxes You provide adequate records of these expenses to your customer or client. How do college students file taxes (See chapter 5 . How do college students file taxes )   In this case, your client or customer is subject to the 50% limit on the expenses. How do college students file taxes Example. How do college students file taxes You are a self-employed attorney who adequately accounts for meal and entertainment expenses to a client who reimburses you for these expenses. How do college students file taxes You are not subject to the directly-related or associated test, nor are you subject to the 50% limit. How do college students file taxes If the client can deduct the expenses, the client is subject to the 50% limit. How do college students file taxes If you (as an independent contractor) have expenses for meals and entertainment related to providing services for a client but do not adequately account for and seek reimbursement from the client for those expenses, you are subject to the directly-related or associated test and to the 50% limit. How do college students file taxes 3 - Advertising expenses. How do college students file taxes   You are not subject to the 50% limit if you provide meals, entertainment, or recreational facilities to the general public as a means of advertising or promoting goodwill in the community. How do college students file taxes For example, neither the expense of sponsoring a television or radio show nor the expense of distributing free food and beverages to the general public is subject to the 50% limit. How do college students file taxes 4 - Sale of meals or entertainment. How do college students file taxes   You are not subject to the 50% limit if you actually sell meals, entertainment, goods and services, or use of facilities to the public. How do college students file taxes For example, if you run a nightclub, your expense for the entertainment you furnish to your customers, such as a floor show, is not subject to the 50% limit. How do college students file taxes 5 - Charitable sports event. How do college students file taxes   You are not subject to the 50% limit if you pay for a package deal that includes a ticket to a qualified charitable sports event. How do college students file taxes For the conditions the sports event must meet, see Exception for events that benefit charitable organizations under What Entertainment Expenses Are Deductible?, later. How do college students file taxes Individuals subject to “hours of service” limits. How do college students file taxes   You can deduct a higher percentage of your meal expenses while traveling away from your tax home if the meals take place during or incident to any period subject to the Department of Transportation's “hours of service” limits. How do college students file taxes The percentage is 80%. How do college students file taxes   Individuals subject to the Department of Transportation's “hours of service” limits include the following persons. How do college students file taxes Certain air transportation workers (such as pilots, crew, dispatchers, mechanics, and control tower operators) who are under Federal Aviation Administration regulations. How do college students file taxes Interstate truck operators and bus drivers who are under Department of Transportation regulations. How do college students file taxes Certain railroad employees (such as engineers, conductors, train crews, dispatchers, and control operations personnel) who are under Federal Railroad Administration regulations. How do college students file taxes Certain merchant mariners who are under Coast Guard regulations. How do college students file taxes What Entertainment Expenses Are Deductible? This section explains different types of entertainment expenses you may be able to deduct. How do college students file taxes Entertainment. How do college students file taxes   Entertainment includes any activity generally considered to provide entertainment, amusement, or recreation. How do college students file taxes Examples include entertaining guests at nightclubs; at social, athletic, and sporting clubs; at theaters; at sporting events; on yachts; or on hunting, fishing, vacation, and similar trips. How do college students file taxes   Entertainment also may include meeting personal, living, or family needs of individuals, such as providing meals, a hotel suite, or a car to customers or their families. How do college students file taxes A meal as a form of entertainment. How do college students file taxes   Entertainment includes the cost of a meal you provide to a customer or client, whether the meal is a part of other entertainment or by itself. How do college students file taxes A meal expense includes the cost of food, beverages, taxes, and tips for the meal. How do college students file taxes To deduct an entertainment-related meal, you or your employee must be present when the food or beverages are provided. How do college students file taxes    You cannot claim the cost of your meal both as an entertainment expense and as a travel expense. How do college students file taxes    Meals sold in the normal course of your business are not considered entertainment. How do college students file taxes Deduction may depend on your type of business. How do college students file taxes   Your kind of business may determine if a particular activity is considered entertainment. How do college students file taxes For example, if you are a dress designer and have a fashion show to introduce your new designs to store buyers, the show generally is not considered entertainment. How do college students file taxes This is because fashion shows are typical in your business. How do college students file taxes But, if you are an appliance distributor and hold a fashion show for the spouses of your retailers, the show generally is considered entertainment. How do college students file taxes Separating costs. How do college students file taxes   If you have one expense that includes the costs of entertainment and other services (such as lodging or transportation), you must allocate that expense between the cost of entertainment and the cost of other services. How do college students file taxes You must have a reasonable basis for making this allocation. How do college students file taxes For example, you must allocate your expenses if a hotel includes entertainment in its lounge on the same bill with your room charge. How do college students file taxes Taking turns paying for meals or entertainment. How do college students file taxes   If a group of business acquaintances takes turns picking up each others' meal or entertainment checks primarily for personal reasons, without regard to whether any business purposes are served, no member of the group can deduct any part of the expense. How do college students file taxes Lavish or extravagant expenses. How do college students file taxes   You cannot deduct expenses for entertainment that are lavish or extravagant. How do college students file taxes An expense is not considered lavish or extravagant if it is reasonable considering the facts and circumstances. How do college students file taxes Expenses will not be disallowed just because they are more than a fixed dollar amount or take place at deluxe restaurants, hotels, nightclubs, or resorts. How do college students file taxes Allocating between business and nonbusiness. How do college students file taxes   If you entertain business and nonbusiness individuals at the same event, you must divide your entertainment expenses between business and nonbusiness. How do college students file taxes You can deduct only the business part. How do college students file taxes If you cannot establish the part of the expense for each person participating, allocate the expense to each participant on a pro rata basis. How do college students file taxes Example. How do college students file taxes You entertain a group of individuals that includes yourself, three business prospects, and seven social guests. How do college students file taxes Only 4/11 of the expense qualifies as a business entertainment expense. How do college students file taxes You cannot deduct the expenses for the seven social guests because those costs are nonbusiness expenses. How do college students file taxes Trade association meetings. How do college students file taxes   You can deduct entertainment expenses that are directly related to and necessary for attending business meetings or conventions of certain exempt organizations if the expenses of your attendance are related to your active trade or business. How do college students file taxes These organizations include business leagues, chambers of commerce, real estate boards, trade associations, and professional associations. How do college students file taxes Entertainment tickets. How do college students file taxes   Generally, you cannot deduct more than the face value of an entertainment ticket, even if you paid a higher price. How do college students file taxes For example, you cannot deduct service fees you pay to ticket agencies or brokers or any amount over the face value of the tickets you pay to scalpers. How do college students file taxes Exception for events that benefit charitable organizations. How do college students file taxes   Different rules apply when the cost of a ticket to a sports event benefits a charitable organization. How do college students file taxes You can take into account the full cost you pay for the ticket, even if it is more than the face value, if all of the following conditions apply. How do college students file taxes The event's main purpose is to benefit a qualified charitable organization. How do college students file taxes The entire net proceeds go to the charity. How do college students file taxes The event uses volunteers to perform substantially all the event's work. How do college students file taxes    The 50% limit on entertainment does not apply to any expense for a package deal that includes a ticket to such a charitable sports event. How do college students file taxes Example 1. How do college students file taxes You purchase tickets to a golf tournament organized by the local volunteer fire company. How do college students file taxes All net proceeds will be used to buy new fire equipment. How do college students file taxes The volunteers will run the tournament. How do college students file taxes You can deduct the entire cost of the tickets as a business expense if they otherwise qualify as an entertainment expense. How do college students file taxes Example 2. How do college students file taxes You purchase tickets to a college football game through a ticket broker. How do college students file taxes After having a business discussion, you take a client to the game. How do college students file taxes Net proceeds from the game go to colleges that qualify as charitable organizations. How do college students file taxes However, since the colleges also pay individuals to perform services, such as coaching and recruiting, you can only use the face value of the tickets in determining your business deduction. How do college students file taxes Skyboxes and other private luxury boxes. How do college students file taxes   If you rent a skybox or other private luxury box for more than one event at the same sports arena, you generally cannot deduct more than the price of a nonluxury box seat ticket. How do college students file taxes   To determine whether a skybox has been rented for more than one event, count each game or other performance as one event. How do college students file taxes For example, renting a skybox for a series of playoff games is considered renting it for more than one event. How do college students file taxes All skyboxes you rent in the same arena, along with any rentals by related parties, are considered in making this determination. How do college students file taxes   Related parties include: Family members (spouses, ancestors, and lineal descendants), Parties who have made a reciprocal arrangement involving the sharing of skyboxes, Related corporations, A partnership and its principal partners, and A corporation and a partnership with common ownership. How do college students file taxes Example. How do college students file taxes You pay $3,000 to rent a 10-seat skybox at Team Stadium for three baseball games. How do college students file taxes The cost of regular nonluxury box seats at each event is $30 a seat. How do college students file taxes You can deduct (subject to the 50% limit) $900 ((10 seats × $30 each) × 3 events). How do college students file taxes Food and beverages in skybox seats. How do college students file taxes   If expenses for food and beverages are separately stated, you can deduct these expenses in addition to the amounts allowable for the skybox, subject to the requirements and limits that apply. How do college students file taxes The amounts separately stated for food and beverages must be reasonable. How do college students file taxes You cannot inflate the charges for food and beverages to avoid the limited deduction for skybox rentals. How do college students file taxes What Entertainment Expenses Are Not Deductible? This section explains different types of entertainment expenses you generally may not be able to deduct. How do college students file taxes Club dues and membership fees. How do college students file taxes   You cannot deduct dues (including initiation fees) for membership in any club organized for: Business, Pleasure, Recreation, or Other social purpose. How do college students file taxes This rule applies to any membership organization if one of its principal purposes is either: To conduct entertainment activities for members or their guests, or To provide members or their guests with access to entertainment facilities, discussed later. How do college students file taxes   The purposes and activities of a club, not its name, will determine whether or not you can deduct the dues. How do college students file taxes You cannot deduct dues paid to: Country clubs, Golf and athletic clubs, Airline clubs, Hotel clubs, and Clubs operated to provide meals under circumstances generally considered to be conducive to business discussions. How do college students file taxes Entertainment facilities. How do college students file taxes   Generally, you cannot deduct any expense for the use of an entertainment facility. How do college students file taxes This includes expenses for depreciation and operating costs such as rent, utilities, maintenance, and protection. How do college students file taxes   An entertainment facility is any property you own, rent, or use for entertainment. How do college students file taxes Examples include a yacht, hunting lodge, fishing camp, swimming pool, tennis court, bowling alley, car, airplane, apartment, hotel suite, or home in a vacation resort. How do college students file taxes Out-of-pocket expenses. How do college students file taxes   You can deduct out-of-pocket expenses, such as for food and beverages, catering, gas, and fishing bait, that you provided during entertainment at a facility. How do college students file taxes These are not expenses for the use of an entertainment facility. How do college students file taxes However, these expenses are subject to the directly-related and associated tests and to the 50% limit , all discussed earlier. How do college students file taxes Expenses for spouses. How do college students file taxes   You generally cannot deduct the cost of entertainment for your spouse or for the spouse of a customer. How do college students file taxes However, you can deduct these costs if you can show you had a clear business purpose, rather than a personal or social purpose, for providing the entertainment. How do college students file taxes Example. How do college students file taxes You entertain a customer. How do college students file taxes The cost is an ordinary and necessary business expense and is allowed under the entertainment rules. How do college students file taxes The customer's spouse joins you because it is impractical to entertain the customer without the spouse. How do college students file taxes You can deduct the cost of entertaining the customer's spouse. How do college students file taxes If your spouse joins the party because the customer's spouse is present, the cost of the entertainment for your spouse is also deductible. How do college students file taxes Gift or entertainment. How do college students file taxes   Any item that might be considered either a gift or entertainment generally will be considered entertainment. How do college students file taxes However, if you give a customer packaged food or beverages that you intend the customer to use at a later date, treat it as a gift. How do college students file taxes   If you give a customer tickets to a theater performance or sporting event and you do not go with the customer to the performance or event, you have a choice. How do college students file taxes You can treat the tickets as either a gift or entertainment, whichever is to your advantage. How do college students file taxes   You can change your treatment of the tickets at a later date by filing an amended return. How do college students file taxes Generally, an amended return must be filed within 3 years from the date the original return was filed or within 2 years from the time the tax was paid, whichever is later. How do college students file taxes   If you go with the customer to the event, you must treat the cost of the tickets as an entertainment expense. How do college students file taxes You cannot choose, in this case, to treat the tickets as a gift. How do college students file taxes Prev  Up  Next   Home   More Online Publications