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How Do I Do My 2012 Taxes

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How Do I Do My 2012 Taxes

How do i do my 2012 taxes Accelerated Cost Recovery System (ACRS) Table of Contents Topics - This chapter discusses: Useful Items - You may want to see: ACRS Defined What Can and Cannot Be Depreciated Under ACRSRecovery Property Nonrecovery Property How To Figure the DeductionUnadjusted Basis Classes of Recovery Property Recovery Periods Alternate ACRS Method (Modified Straight Line Method) ACRS Deduction in Short Tax Year DispositionsEarly dispositions of ACRS property other than 15-, 18-, or 19-year real property. How do i do my 2012 taxes Dispositions — mass asset accounts. How do i do my 2012 taxes Early dispositions — 15-year real property. How do i do my 2012 taxes Early dispositions — 18- and 19-year real property. How do i do my 2012 taxes Depreciation Recapture Topics - This chapter discusses: The definition of ACRS What can and cannot be depreciated under ACRS How to figure the deduction Dispositions Useful Items - You may want to see: Publication 544 Sales and Other Dispositions of Assets 551 Basis of Assets 583 Starting a Business and Keeping Records Form (and Instructions) 3115 Application for Change in Accounting Method 4562 Depreciation and Amortization The Accelerated Cost Recovery System (ACRS) applies to property first used before 1987. How do i do my 2012 taxes It is the name given to tax rules for getting back (recovering) through depreciation deductions the cost of property used in a trade or business or to produce income. How do i do my 2012 taxes These rules are mandatory and generally apply to tangible property placed in service after 1980 and before 1987. How do i do my 2012 taxes If you placed property in service during this period, you must continue to figure your depreciation under ACRS. How do i do my 2012 taxes If you used listed property placed in service after June 18, 1984, less than 50% for business in 1995, see Predominant Use Test in chapter 3. How do i do my 2012 taxes Listed property includes cars, other means of transportation, and certain computers. How do i do my 2012 taxes Any additions or improvements placed in service after 1986, including any components of a building (such as plumbing, wiring, storm windows, etc. How do i do my 2012 taxes ), are depreciated using MACRS, discussed in chapter 3 of Publication 946. How do i do my 2012 taxes It does not matter that the underlying property is depreciated under ACRS or one of the other methods. How do i do my 2012 taxes ACRS Defined ACRS consists of accelerated depreciation methods and an alternate ACRS method that could have been elected. How do i do my 2012 taxes The alternate ACRS method used a recovery percentage based on a modified straight line method. How do i do my 2012 taxes The law prescribes fixed percentages to be uses for each class of property. How do i do my 2012 taxes Property depreciable under ACRS is called recovery property. How do i do my 2012 taxes The recovery class of property determines the recovery period. How do i do my 2012 taxes Generally, the class life of property places it in a 3-year, 5-year, 10-year, 15-year, 18-year, or 19-year recovery class. How do i do my 2012 taxes Under ACRS, the prescribed percentages are used to recover the unadjusted basis of recovery property. How do i do my 2012 taxes To figure a depreciation deduction, you multiply the prescribed percentage for the recovery class by the unadjusted basis of the recovery property. How do i do my 2012 taxes You must continue to figure your depreciation under ACRS for property placed in service after 1980 and before 1987. How do i do my 2012 taxes For property you placed in service after 1986, you must use MACRS, discussed in chapter 3 of Publication 946. How do i do my 2012 taxes What Can and Cannot Be Depreciated Under ACRS ACRS applies to most depreciable tangible property placed in service after 1980 and before 1987. How do i do my 2012 taxes It includes new or used and real or personal property. How do i do my 2012 taxes The property must be for use in a trade or business or for the production of income. How do i do my 2012 taxes Property you acquired before 1981 or after 1986 is not ACRS recovery property. How do i do my 2012 taxes For information on depreciating property acquired before 1981, see chapter 2. How do i do my 2012 taxes For information on depreciating property acquired after 1986, see chapter 3 of Publication 946. How do i do my 2012 taxes Recovery Property Recovery property under ACRS is tangible depreciable property placed in service after 1980 and before 1987. How do i do my 2012 taxes It generally includes new or used property that you acquired after 1980 and before 1987 for use in your trade or business or for the production of income. How do i do my 2012 taxes Nonrecovery Property You cannot use ACRS for property you placed in service before 1981 or after 1986. How do i do my 2012 taxes Nonrecovery property also includes: Intangible property, Property you elected to exclude from ACRS that is properly depreciated under a method of depreciation that is not based on a term of years, Certain public utility property, and Certain property acquired and excluded from ACRS because of the antichurning rules. How do i do my 2012 taxes Intangible property. How do i do my 2012 taxes   Intangible property is not depreciated under ACRS. How do i do my 2012 taxes Property depreciated under methods not expressed in a term of years. How do i do my 2012 taxes   Certain property depreciated under a method not expressed in a term of years is not depreciated under ACRS. How do i do my 2012 taxes This included any property: If you made an irrevocable election to exclude such property, and In the first year that you could have claimed depreciation, you properly used the unit-of-production method or any method of depreciation not expressed in a term of years (not including the retirement-replacement-betterment method). How do i do my 2012 taxes Public utility property. How do i do my 2012 taxes   Public utility property for which the taxpayer does not use a normalization method of accounting is excluded from ACRS and is subject to depreciation under a special rule. How do i do my 2012 taxes Additions or improvements to ACRS property after 1986. How do i do my 2012 taxes   Any additions or improvements placed in service after 1986, including any components of a building (plumbing, wiring, storm windows, etc. How do i do my 2012 taxes ) are depreciated using MACRS, discussed in chapter 3 of Publication 946. How do i do my 2012 taxes It does not matter that the underlying property is depreciated under ACRS or one of the other methods. How do i do my 2012 taxes How To Figure the Deduction After you determine that your property can be depreciated under ACRS, you are ready to figure your deduction. How do i do my 2012 taxes Because the conventions are built into the percentage table rates, you only need to know the following: The unadjusted basis of your recovery property, The classes of recovery property, The recovery periods, and Whether to use the prescribed percentages based on accelerated methods or percentages based on using the alternate ACRS method. How do i do my 2012 taxes Unadjusted Basis To figure your ACRS deduction, you multiply the unadjusted basis in your recovery property by its applicable percentage for the year. How do i do my 2012 taxes Unadjusted basis is the same amount you would use to figure gain on a sale, but it is figured without taking into account any depreciation taken in earlier years. How do i do my 2012 taxes However, reduce your original basis by the amount of amortization taken on the property and by any section 179 deduction claimed as discussed in chapter 2 of Publication 946. How do i do my 2012 taxes If you buy property, your unadjusted basis is usually its cost minus any amortized amount and minus any section 179 deduction elected. How do i do my 2012 taxes If you acquire property in some other way, such as by inheriting it, getting it as a gift, or building it yourself, you figure your unadjusted basis under other rules. How do i do my 2012 taxes See Publication 551. How do i do my 2012 taxes Classes of Recovery Property All recovery property under ACRS is in one of the following classes. How do i do my 2012 taxes The class for your property was determined when you began to depreciate it. How do i do my 2012 taxes 3-Year Property 3-year property includes automobiles, light-duty trucks (actual unloaded weight less than 13,000 pounds), and tractor units for use over-the-road. How do i do my 2012 taxes Race horses over 2 years old when placed in service are 3-year property. How do i do my 2012 taxes Any other horses over 12 years old when you placed them in service are also included in the 3-year property class. How do i do my 2012 taxes The ACRS percentages for 3-year recovery property are: Recovery Period Percentage 1st year 25% 2nd year 38% 3rd year 37% If you used the percentages above to depreciate your 3-year recovery property, your property, except for certain passenger automobiles, is fully depreciated. How do i do my 2012 taxes You cannot claim depreciation for this property after 1988. How do i do my 2012 taxes 5-Year Property 5-year property includes computers, copiers, and equipment, such as office furniture and fixtures. How do i do my 2012 taxes It also includes single purpose agricultural or horticultural structures and petroleum storage facilities (other than buildings and their structural components). How do i do my 2012 taxes The ACRS percentages for 5-year recovery property are: Recovery period Percentage 1st year 15% 2nd year 22% 3rd through 5th year 21% If you used the percentages above to depreciate your 5-year recovery property, it is fully depreciated. How do i do my 2012 taxes You cannot claim depreciation for this property after 1990. How do i do my 2012 taxes 10-Year Property 10-year property includes certain real property such as theme-park structures and certain public utility property. How do i do my 2012 taxes Manufactured homes (including mobile homes) and railroad tank cars are also 10-year property. How do i do my 2012 taxes You do not treat a building, and its structural components, as 10-year property by reason of a change in use after you placed the property in service. How do i do my 2012 taxes For example, a building (15-year real property) that was placed in service in 1981 and was converted to a theme-park structure in 1986 remains 15-year real property. How do i do my 2012 taxes The ACRS percentages for 10-year recovery property are: Recovery Period Percentage 1st year 8% 2nd year 14% 3rd year 12% 4th through 6th year 10% 7th through 10th year 9% If you used the percentages above, you cannot claim depreciation for this property after 1995. How do i do my 2012 taxes Example. How do i do my 2012 taxes On April 21, 1986, you bought and placed in service a new mobile home for $26,000 to be used as rental property. How do i do my 2012 taxes You paid $10,000 cash and signed a note for $16,000 giving you an unadjusted basis of $26,000. How do i do my 2012 taxes On June 8, 1986, you bought and placed in service a used mobile home for use as rental property at a total cost of $11,500. How do i do my 2012 taxes The total unadjusted basis of your 10-year recovery property placed in service in 1986 was $37,500 ($26,000 + $11,500). How do i do my 2012 taxes Your ACRS deduction was $3,000 (8% × $37,500). How do i do my 2012 taxes In 1987, your ACRS deduction was $5,250 (14% × $37,500). How do i do my 2012 taxes In 1988, your ACRS deduction was $4,500 (12% × $37,500). How do i do my 2012 taxes In 1989, 1990, and 1991, your ACRS deduction was $3,750 (10% × $37,500). How do i do my 2012 taxes In 1992, 1993, 1994, and 1995 your deduction for each year is $3,375 (9% × $37,500). How do i do my 2012 taxes 15-Year Real Property 15-year real property is real property that is recovery property placed in service before March 16, 1984. How do i do my 2012 taxes It includes all real property, such as buildings, other than that designated as 5-year or 10-year property. How do i do my 2012 taxes Unlike the 3-, 5-, or 10-year classes of property, the percentages for 15-year real property depend on when you placed the property in service during your tax year. How do i do my 2012 taxes You could group 15-year real property by month and year placed in service. How do i do my 2012 taxes In Table 1, at the end of this publication in the Appendix, find the month in your tax year that you placed the property in service in your trade or business or for the production of income. How do i do my 2012 taxes You use the percentages listed under that month for each year of the recovery period to determine your depreciation deduction each year. How do i do my 2012 taxes Example. How do i do my 2012 taxes On March 5, 1984, you placed an apartment building in service in your business. How do i do my 2012 taxes It is 15-year real property. How do i do my 2012 taxes After subtracting the value of the land, your unadjusted basis in the building is $250,000. How do i do my 2012 taxes You use the calendar year as your tax year. How do i do my 2012 taxes March is the third month of your tax year. How do i do my 2012 taxes Your ACRS deduction for 1984 was $25,000 (10% × $250,000). How do i do my 2012 taxes For 1985, the percentage for the third month of the second year of the recovery period is 11%. How do i do my 2012 taxes Your deduction was $27,500 (11% × $250,000). How do i do my 2012 taxes For the third, fourth, and fifth years of the recovery period (1986, 1987, and 1988), the percentages are 9%, 8%, and 7%. How do i do my 2012 taxes For 1989 through 1992, the percentage for the third month is 6%. How do i do my 2012 taxes Your deduction each year is $15,000 (6% × $250,000). How do i do my 2012 taxes For 1993, 1994, and 1995, the percentage for the third month is 5%. How do i do my 2012 taxes Your depreciation deduction is $12,500 (5% × $250,000) for 1993, 1994, and 1995. How do i do my 2012 taxes Low-Income Housing Low-income housing that was assigned a 15-year recovery period under ACRS includes the following types of property: Federally assisted housing projects where the mortgage is insured under section 221(d)(3) or 236 of the National Housing Act, or housing financed or assisted by direct loan or tax abatement under similar provisions of state or local laws. How do i do my 2012 taxes Low-income rental housing for which a depreciation deduction for rehabilitation expenditures is allowed. How do i do my 2012 taxes Low-income rental housing held for occupancy by families or individuals eligible to receive subsidies under section 8 of the United States Housing Act of 1937, as amended, or under the provisions of state or local laws that authorize similar subsidies for low-income families. How do i do my 2012 taxes Housing financed or assisted by direct loan or insured under Title V of the Housing Act of 1949. How do i do my 2012 taxes The ACRS percentages for low-income housing real property, like the regular 15-year real property percentages, depend on when you placed the property in service. How do i do my 2012 taxes Find the month in your tax year in Table 2 or 3 at the end of this publication in the Appendix that you first placed the property in service as rental housing. How do i do my 2012 taxes Use the percentages listed under that month for each year of the recovery period. How do i do my 2012 taxes Table 2 shows percentages for low-income housing placed in service before May 9, 1985. How do i do my 2012 taxes Table 3 shows percentages for low-income housing placed in service after May 8, 1985, and before 1987. How do i do my 2012 taxes Example. How do i do my 2012 taxes In May 1986, you acquired and placed in service a house that qualified as low-income rental housing under item 3) of the above listing. How do i do my 2012 taxes You use the calendar year as your tax year. How do i do my 2012 taxes You use Table C–3 because the property was placed in service after May 8, 1985. How do i do my 2012 taxes Your unadjusted basis for the property, not including the land, was $59,000. How do i do my 2012 taxes Your deduction for 1986 through 2001 is shown in the following table. How do i do my 2012 taxes Year Rate Deduction 1986 8. How do i do my 2012 taxes 9% $5,251 1987 12. How do i do my 2012 taxes 1% 7,139 1988 10. How do i do my 2012 taxes 5% 6,195 1989 9. How do i do my 2012 taxes 1% 5,369 1990 7. How do i do my 2012 taxes 9% 4,661 1991 6. How do i do my 2012 taxes 9% 4,071 1992 5. How do i do my 2012 taxes 9% 3,481 1993 5. How do i do my 2012 taxes 2% 3,068 1994 4. How do i do my 2012 taxes 6% 2,714 1995 4. How do i do my 2012 taxes 6% 2,714 1996 4. How do i do my 2012 taxes 6% 2,714 1997 4. How do i do my 2012 taxes 6% 2,714 1998 4. How do i do my 2012 taxes 6% 2,714 1999 4. How do i do my 2012 taxes 5% 2,655 2000 4. How do i do my 2012 taxes 5% 2,655 2001 1. How do i do my 2012 taxes 5% 885 18-Year Real Property 18-year real property is real property that is recovery property placed in service after March 15, 1984, and before May 9, 1985. How do i do my 2012 taxes It includes real property, such as buildings, other than that designated as 5-year, 10-year, 15-year real property, or low-income housing. How do i do my 2012 taxes The ACRS percentages for 18-year real property depend on when you placed the property in service in your trade or business or for the production of income during your tax year. How do i do my 2012 taxes There are also tables for 18-year real property in the Appendix. How do i do my 2012 taxes Table 4 shows the percentages for 18-year real property you placed in service after June 22, 1984, and before May 9, 1985. How do i do my 2012 taxes Table 5 is for 18-year real property placed in service after March 15, 1984, and before June 23, 1984. How do i do my 2012 taxes Find the month in your tax year that you placed the property in service in a trade or business or for the production of income. How do i do my 2012 taxes Use the percentages listed under that month for each year of the recovery period. How do i do my 2012 taxes Example. How do i do my 2012 taxes On April 28, 1985, you bought and placed in service a rental house. How do i do my 2012 taxes The house, not including the land, cost $95,000. How do i do my 2012 taxes This is your unadjusted basis for the house. How do i do my 2012 taxes You use the calendar year as your tax year. How do i do my 2012 taxes Because the house was placed in service after June 22, 1984, and before May 9, 1985, it is 18-year real property. How do i do my 2012 taxes You use Table 4 to figure your deduction for the house. How do i do my 2012 taxes April is the fourth month of your tax year. How do i do my 2012 taxes Your deduction for 1985 through 2003 is shown in the following table. How do i do my 2012 taxes Year Rate Deduction 1985 7. How do i do my 2012 taxes 0% $6,650 1986 9. How do i do my 2012 taxes 0% 8,550 1987 8. How do i do my 2012 taxes 0% 7,600 1988 7. How do i do my 2012 taxes 0% 6,650 1989 7. How do i do my 2012 taxes 0% 6,650 1990 6. How do i do my 2012 taxes 0% 5,700 1991 5. How do i do my 2012 taxes 0% 4,750 1992 5. How do i do my 2012 taxes 0% 4,750 1993 5. How do i do my 2012 taxes 0% 4,750 1994 5. How do i do my 2012 taxes 0% 4,750 1995 5. How do i do my 2012 taxes 0% 4,750 1996 5. How do i do my 2012 taxes 0% 4,750 1997 5. How do i do my 2012 taxes 0% 4,750 1998 4. How do i do my 2012 taxes 0% 3,800 1999 4. How do i do my 2012 taxes 0% 3,800 2000 4. How do i do my 2012 taxes 0% 3,800 2001 4. How do i do my 2012 taxes 0% 3,800 2002 4. How do i do my 2012 taxes 0% 3,800 2003 1. How do i do my 2012 taxes 0% 950 19-Year Real Property 19-year real property is real property that is recovery property placed in service after May 8, 1985, and before 1987. How do i do my 2012 taxes It includes all real property, other than that designated as 5-year, 10-year, 15-year, or 18-year real property, or low-income housing. How do i do my 2012 taxes The ACRS percentages for 19-year real property depend on when you placed the property in service in a trade or business or for the production of income during your tax year. How do i do my 2012 taxes Table 6 shows the percentages for 19-year real property. How do i do my 2012 taxes You find the month in your tax year that you placed the property in service. How do i do my 2012 taxes You use the percentages listed under that month for each year of the recovery period. How do i do my 2012 taxes Recovery Periods Each item of recovery property is assigned to a class of property. How do i do my 2012 taxes The classes of recovery property establish the recovery periods over which the unadjusted basis of items in a class is recovered. How do i do my 2012 taxes The classes of property are: 3-Year property 5-Year property 10-Year property 15-Year real property Low-income housing 18-Year real property 19-Year real property Alternate ACRS Method (Modified Straight Line Method) ACRS provides an alternate ACRS method that could be elected. How do i do my 2012 taxes This alternate ACRS method uses a recovery percentage based on a modified straight line method. How do i do my 2012 taxes This alternate ACRS method generally uses percentages other than those from the tables. How do i do my 2012 taxes If you elected the alternate ACRS method, you determine the recovery period by using the following schedule. How do i do my 2012 taxes This schedule is for other than 18- and 19-year real property and low-income housing: In the case of: You could have elected a recovery period of: 3-year property 3, 5, or 12 years 5-year property 5, 12, or 25 years 15-year real property 15, 35, or 45 years Percentages. How do i do my 2012 taxes   The straight-line percentages for the alternate ACRS method are: Recovery Period Percentage 5 years 20. How do i do my 2012 taxes 00% 10 years 10. How do i do my 2012 taxes 00% 12 years 8. How do i do my 2012 taxes 333% 15 years 6. How do i do my 2012 taxes 667% 25 years 4. How do i do my 2012 taxes 00% 35 years 2. How do i do my 2012 taxes 857%   You apply the percentage to the unadjusted basis(defined earlier) of the property to figure your ACRS deduction. How do i do my 2012 taxes There are tables for 18- and 19-year real property later in this publication in the Appendix. How do i do my 2012 taxes For 15-year real property, see 15-year real property, later. How do i do my 2012 taxes 3-, 5-, and 10-year property. How do i do my 2012 taxes   If you elected to use an alternate recovery percentage, you have to use the same recovery percentage for all property in that class that you placed in service in that tax year. How do i do my 2012 taxes This applies throughout the recovery period you selected. How do i do my 2012 taxes Half-year convention. How do i do my 2012 taxes   If you elected the alternate method, only a half-year of depreciation was deducted for the year you placed the property in service. How do i do my 2012 taxes This applied regardless of when in the tax year you placed the property in service. How do i do my 2012 taxes For each of the remaining years in the recovery period, you take a full year's deduction. How do i do my 2012 taxes If you hold the property for the entire recovery period, a half-year of depreciation is allowable for the year following the end of the recovery period. How do i do my 2012 taxes Example. How do i do my 2012 taxes You operate a small upholstery business. How do i do my 2012 taxes On March 19, 1986, you bought and placed in service a $13,000 light-duty panel truck to be used in your business and a $500 electric saw. How do i do my 2012 taxes You elected to use the alternate ACRS method. How do i do my 2012 taxes You did not elect to take a section 179 deduction. How do i do my 2012 taxes You decided to recover the cost of the truck, which is 3-year recovery property, over 5 years. How do i do my 2012 taxes The saw is 5-year property, but you decided to recover its cost over 12 years. How do i do my 2012 taxes For 1986, your ACRS deduction reflected the half-year convention. How do i do my 2012 taxes In the first year, you deducted half of the amount determined for a full year. How do i do my 2012 taxes Your ACRS deduction for 1986 is as follows: Light-duty truck   5 years straight line = 20% 20% ÷ $13,000 = $2,600 Half-year convention -½ of $2,600= $1,300. How do i do my 2012 taxes 00     Electric saw   12 years straight line = 8. How do i do my 2012 taxes 333% 8. How do i do my 2012 taxes 333% ÷ $500 = $41. How do i do my 2012 taxes 67 Half-year convention -½ of $41. How do i do my 2012 taxes 67= 20. How do i do my 2012 taxes 84 Total ACRS deduction for 1986 $1,320. How do i do my 2012 taxes 84       You take a full year of depreciation for both the truck and the saw for the years 1987 through 1990. How do i do my 2012 taxes Your ACRS deduction for each of those years is as follows: Light-duty truck   5 years straight line = 20% 20% ÷ $13,000 = $2,600     Electric saw     12 years straight line = 8. How do i do my 2012 taxes 333% 8. How do i do my 2012 taxes 333% ÷ $500 = $41. How do i do my 2012 taxes 67 Total annual ACRS deduction for 1987 through 1990 $2,641. How do i do my 2012 taxes 67       In 1991, you take a half-year of depreciation for the truck and a full year of depreciation for the saw. How do i do my 2012 taxes Your ACRS deduction for 1991 is as follows: Light-duty truck   5 years straight line = 20% 20% ÷ $13,000 = $2,600 Half-year convention -½ of $2,600= $1,300. How do i do my 2012 taxes 00     Electric saw   12 years straight line = 8. How do i do my 2012 taxes 333% 8. How do i do my 2012 taxes 333% ÷ $500 = $41. How do i do my 2012 taxes 67 Total ACRS deduction for 1991 $1,341. How do i do my 2012 taxes 67       The truck is fully depreciated after 1991. How do i do my 2012 taxes You take a full year of depreciation for the saw for the years 1992 through 1997. How do i do my 2012 taxes Your ACRS deduction for each of those years is as follows: Electric saw     12 years straight line = 8. How do i do my 2012 taxes 333% 8. How do i do my 2012 taxes 333% ÷ $500 = $41. How do i do my 2012 taxes 67 Total annual ACRS deduction for 1992 through 1997 $41. How do i do my 2012 taxes 67       You take a half-year of depreciation for the saw for 1998. How do i do my 2012 taxes Your ACRS deduction for 1998 is as follows: Electric saw   12 years straight line = 8. How do i do my 2012 taxes 333% 8. How do i do my 2012 taxes 333% ÷ $500 = $41. How do i do my 2012 taxes 67 Half-year convention -½ of $41. How do i do my 2012 taxes 67= 20. How do i do my 2012 taxes 84 Total ACRS deduction for 1998 $20. How do i do my 2012 taxes 84       The saw is fully depreciated after 1998. How do i do my 2012 taxes 15-year real property. How do i do my 2012 taxes   Under ACRS, you could also elect to use the alternate ACRS method for 15-year real property. How do i do my 2012 taxes The alternate ACRS method allows you to depreciate your 15-year real property using the straight line ACRS method over the alternate recovery periods of 15, 35, or 45 years. How do i do my 2012 taxes If you selected a 15-year recovery period, you use the percentage (6. How do i do my 2012 taxes 667%) from the schedule above. How do i do my 2012 taxes You prorate this percentage for the number of months the property was in service in the first year. How do i do my 2012 taxes If you selected a 35- or 45-year recovery period, you use either Table 11 or 15. How do i do my 2012 taxes Alternate periods for 18-year real property. How do i do my 2012 taxes   For 18-year real property, the alternate recovery periods are 18, 35, or 45 years. How do i do my 2012 taxes The percentages for 18-year real property under the alternate method are in Tables 7, 8, 10, 11, 14, and 15 in the Appendix. How do i do my 2012 taxes There are two tables for each alternate recovery period. How do i do my 2012 taxes One table shows the percentage for property placed in service after June 22, 1984. How do i do my 2012 taxes The other table has the percentages for property placed in service after March 15, 1984, and before June 23, 1984. How do i do my 2012 taxes Alternate periods for 19-year real property. How do i do my 2012 taxes   For 19-year real property, the alternate recovery periods are 19, 35, or 45 years. How do i do my 2012 taxes If you selected a 19-year recovery period, use Table 9 to determine your deduction. How do i do my 2012 taxes If you select a 35- or 45-year recovery period, use either Table 13 or 14. How do i do my 2012 taxes Example. How do i do my 2012 taxes You placed in service an apartment building on August 3, 1986. How do i do my 2012 taxes The building is 19-year real property. How do i do my 2012 taxes The sales contract allocated $300,000 to the building and $100,000 to the land. How do i do my 2012 taxes You use the calendar year as your tax year. How do i do my 2012 taxes You chose the alternate ACRS method over a recovery period of 35 years. How do i do my 2012 taxes For 1986, you figure your ACRS deduction usingTable 13. How do i do my 2012 taxes August is the eighth month of your tax year. How do i do my 2012 taxes The percentage from Table 13 for the eighth month is 1. How do i do my 2012 taxes 1%. How do i do my 2012 taxes Your deduction was $3,300 ($300,000 ÷ 1. How do i do my 2012 taxes 1%). How do i do my 2012 taxes The deduction rate from ACRS Table 13 for years 2 through 20 is 2. How do i do my 2012 taxes 9% so that your deduction in 1987 through 2005 is $8,700 ($300,000 ÷ 2. How do i do my 2012 taxes 9%). How do i do my 2012 taxes Alternate periods for low-income housing. How do i do my 2012 taxes   For low-income housing, the alternate recovery periods are 15, 35, or 45 years. How do i do my 2012 taxes If you selected a 15-year period for this property, use 6. How do i do my 2012 taxes 667% as the percentage. How do i do my 2012 taxes If you selected a 35- or 45-year period, use either Table 11, 12, or 15. How do i do my 2012 taxes Election. How do i do my 2012 taxes   You had to make the election to use the alternate ACRS method by the return due date (including extensions) for the tax year you placed the property in service. How do i do my 2012 taxes Revocation of election. How do i do my 2012 taxes   Your election to use an alternate ACRS method, once made, can be changed only with the consent of the Commissioner. How do i do my 2012 taxes The Commissioner grants consent only in extraordinary circumstances. How do i do my 2012 taxes Any request for a revocation will be considered a request for a ruling. How do i do my 2012 taxes ACRS Deduction in Short Tax Year For a tax year that is less than 12 months, the ACRS deduction is prorated on a 12-month basis. How do i do my 2012 taxes Figure the amount of the ACRS deduction for a short tax year as follows: First, you figure the ACRS deduction for a full year. How do i do my 2012 taxes You figure this by multiplying the unadjusted basis by the recovery percentage. How do i do my 2012 taxes You then multiply the ACRS deduction determined for a full tax year by a fraction. How do i do my 2012 taxes The numerator (top number) of the fraction is the number of months in the short tax year and the denominator (bottom number) is 12. How do i do my 2012 taxes For example, a corporation placed in service in June 1986 an item of 3-year property with an unadjusted basis of $10,000. How do i do my 2012 taxes The corporation files a tax return, because of a change in its accounting period, for the 6-month short tax year ending June 30, 1986. How do i do my 2012 taxes The full year's ACRS deduction for this item is $2,500 ($10,000 ÷ 25%), the first year percentage from the 3-year table. How do i do my 2012 taxes The ACRS deduction for the short tax year is $1,250 ($2,500 ÷ 6/12). How do i do my 2012 taxes You use the full ACRS percentages during the remaining years of the recovery period. How do i do my 2012 taxes For the first tax year after the recovery period, the unrecovered basis will be deductible. How do i do my 2012 taxes Exception. How do i do my 2012 taxes   For the tax year in which you placed 15-, 18-, or 19-year real property in service or in the tax year you dispose of it, you compute the ACRS deduction for the number of months that the property is in service during that tax year. How do i do my 2012 taxes You compute the number of months using either a full month or mid-month convention. How do i do my 2012 taxes This is true regardless of the number of months in the tax year and the recovery period and method used. How do i do my 2012 taxes Dispositions A disposition is the permanent withdrawal of property from use in your trade or business or in the production of income. How do i do my 2012 taxes You can make a withdrawal by sale, exchange, retirement, abandonment, or destruction. How do i do my 2012 taxes You generally recognize gain or loss on the disposition of an asset by sale. How do i do my 2012 taxes However, nonrecognition rules can allow you to postpone some gain. How do i do my 2012 taxes See Publication 544. How do i do my 2012 taxes If you physically abandon property, you can deduct as a loss the adjusted basis of the asset at the time of its abandonment. How do i do my 2012 taxes Your intent must be to discard the asset so that you will not use it again or retrieve it for sale, exchange, or other disposition. How do i do my 2012 taxes Early dispositions. How do i do my 2012 taxes   The disposal of an asset before the end of its specified recovery period, is referred to as an early disposition. How do i do my 2012 taxes When an early disposition occurs, the depreciation deduction in the year of disposition depends on the class of property involved. How do i do my 2012 taxes Early dispositions of ACRS property other than 15-, 18-, or 19-year real property. How do i do my 2012 taxes   Generally, you get no ACRS deduction for the tax year in which you dispose of or retire recovery property, except for 15-, 18-, and 19-year real property. How do i do my 2012 taxes This means there is no depreciation deduction under ACRS in the year you dispose of or retire any of your 3-, 5-, or 10-year recovery property. How do i do my 2012 taxes Dispositions — mass asset accounts. How do i do my 2012 taxes   The law provides a special rule to avoid the calculation of gain on the disposition of assets from mass asset accounts. How do i do my 2012 taxes A mass asset account includes items usually minor in value in relation to the group, numerous in quantity, impractical to separately identify, and not usually accounted for on a separate basis, but on a total dollar value. How do i do my 2012 taxes Examples of mass assets include minor items of office, plant, and store furniture and fixtures. How do i do my 2012 taxes   Under the special rule, if you elected to use a mass asset account, you recognize gain to the extent of the proceeds from the disposition of the asset. How do i do my 2012 taxes You leave the unadjusted basis of the property in the account until recovered in future years. How do i do my 2012 taxes If you did this, include the total proceeds realized from the disposition in income on the tax return for the year of disposition. How do i do my 2012 taxes Early dispositions — 15-year real property. How do i do my 2012 taxes   If you dispose of 15-year real property, you base your ACRS deduction for the year of disposition on the number of months in use. How do i do my 2012 taxes You use a full-month convention. How do i do my 2012 taxes For a disposition at any time during a particular month before the end of the recovery period, no deduction is allowed for the month of disposition. How do i do my 2012 taxes This applies whether you use the regular ACRS method or elected the alternate ACRS method. How do i do my 2012 taxes Example. How do i do my 2012 taxes You purchased and placed in service a rental house on March 2, 1984, for $98,000 (not including the cost of land). How do i do my 2012 taxes You file your return based on a calendar year. How do i do my 2012 taxes Your rate from Table 1 for the third month is 10%. How do i do my 2012 taxes Your ACRS deduction for 1984 was $9,800 ($98. How do i do my 2012 taxes 000 ÷ 10%). How do i do my 2012 taxes For 1985 through 1988, you figured your ACRS deductions using 11%, 9%, 8%, and 7% ÷ $98,000. How do i do my 2012 taxes For 1989 through 1992, you figured your ACRS deductions using 6% for each year. How do i do my 2012 taxes The deduction each year was $98,000 ÷ 6%. How do i do my 2012 taxes For 1993 and 1994, the ACRS deduction is ($98,000 ÷ 5%) $4,900 for each year. How do i do my 2012 taxes You sell the house on June 1, 1995. How do i do my 2012 taxes You figure your ACRS deduction for 1995 for the full year and then prorate that amount for the months of use. How do i do my 2012 taxes The full ACRS deduction for 1995 is $4,900 ($98,000 ÷ 5%). How do i do my 2012 taxes You then prorate this amount to the 5 months in 1995 during which it was rented. How do i do my 2012 taxes Your ACRS deduction for 1995 is $2,042 ($4,900 ÷ 5/12). How do i do my 2012 taxes Early dispositions — 18- and 19-year real property. How do i do my 2012 taxes   If you dispose of 18- or 19-year real property, you base your ACRS deduction for the year of disposition on the number of months in use. How do i do my 2012 taxes For 18-year property placed in service before June 23, 1984, use a full-month convention on a disposition. How do i do my 2012 taxes For 18-year property placed in service after June 22, 1984, and for 19-year property, determine the number of months in use by using the mid-month convention. How do i do my 2012 taxes Under the mid-month convention,treat real property disposed of any time during a month as disposed of in the middle of that month. How do i do my 2012 taxes Count the month of disposition as half a month of use. How do i do my 2012 taxes Example. How do i do my 2012 taxes You purchased and placed in service a rental house on July 2, 1984, for $100,000 (not including the cost of land). How do i do my 2012 taxes You file your return based on a calendar year. How do i do my 2012 taxes Your rate from Table 4 for the seventh month is 4%. How do i do my 2012 taxes You figured your ACRS deduction for 1984 was $4,000 ($100,000 ÷ 4%). How do i do my 2012 taxes In 1985 through 1994, your ACRS deductions were 9%, 8%, 8%, 7%, 6%, 6%, 5%, 5%, and 5% ÷ $100,000. How do i do my 2012 taxes You sell the house on September 24, 1995. How do i do my 2012 taxes Figure your ACRS deduction for 1995 for the months of use. How do i do my 2012 taxes The full ACRS deduction for 1995 is $5,000 ($100,000 ÷ 5%). How do i do my 2012 taxes Prorate this amount for the 8. How do i do my 2012 taxes 5 months in 1995 that you held the property. How do i do my 2012 taxes Under the mid-month convention, you count September as half a month. How do i do my 2012 taxes Your ACRS deduction for 1995 is $3,542 ($5,000 ÷ 8. How do i do my 2012 taxes 5/12). How do i do my 2012 taxes Depreciation Recapture If you dispose of property depreciated under ACRS that is section 1245 recovery property, you will generally recognize gain or loss. How do i do my 2012 taxes Gain recognized on a disposition is ordinary income to the extent of prior depreciation deductions taken. How do i do my 2012 taxes This recapture rule applies to all personal property in the 3-year, 5-year, and 10-year classes. How do i do my 2012 taxes You recapture gain on manufactured homes and theme park structures in the 10-year class as section 1245 property. How do i do my 2012 taxes Section 1245 property generally includes all personal property. How do i do my 2012 taxes See Section 1245 property in chapter 4 of Publication 544 for more information. How do i do my 2012 taxes You treat dispositions of section 1250 real property on which you have a gain as section 1245 recovery property. How do i do my 2012 taxes You recognize gain on this property as ordinary income to the extent of prior depreciation deductions taken. How do i do my 2012 taxes Section 1250 property includes most real property. How do i do my 2012 taxes See Section 1250 property in chapter 4 of Publication 544 for more information. How do i do my 2012 taxes This rule applies to all section 1250 real property except the following property: Any 15-, 18-, or 19-year real property that is residential rental property. How do i do my 2012 taxes Any 15-, 18-, or 19-year real property that you elected to depreciate using the alternate ACRS method. How do i do my 2012 taxes Any 15-, 18-, or 19-year real property that is subsidized low-income housing. How do i do my 2012 taxes For these recapture rules, you treat the section 179 deduction and 50% of the investment credit that reduced your basis as depreciation. How do i do my 2012 taxes See Publication 544 for further discussion of dispositions of section 1245 and 1250 property. How do i do my 2012 taxes Prev  Up  Next   Home   More Online Publications
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Should I itemize?

You should itemize deductions if your total deductions are more than the standard deduction amount. Also, if your standard deduction is zero, you should itemize any deductions you have if:

  • You are married and filing a separate return, and your spouse itemizes deductions,
  • You are filing a tax return for a short tax year because of a change in your annual accounting period, or
  • You are a nonresident or dual-status alien during the year. You are considered a dual-status alien if you were both a nonresident and resident alien during the year.

NOTE: If you are a nonresident alien who is married to a U.S. citizen or resident at the end of the year, you can choose to be treated as a U.S. resident. (See Publication 519, U.S. Tax Guide for Aliens.) If you make this choice, you can take the standard deduction.

When to itemize

You may benefit from itemizing your deductions on Schedule A (Form 1040) if you:

  • Do not qualify for the standard deduction, or the amount you can claim is limited,
  • Had large uninsured medical and dental expenses during the year,
  • Paid interest and taxes on your home,
  • Had large unreimbursed employee business expenses or other miscellaneous deductions,
  • Had large uninsured casualty or theft losses,
  • Made large contributions to qualified charities, or
  • Have total itemized deductions that are more than the standard deduction to which you otherwise are entitled.

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Page Last Reviewed or Updated: 12-Nov-2013

The How Do I Do My 2012 Taxes

How do i do my 2012 taxes 20. How do i do my 2012 taxes   Standard Deduction Table of Contents What's New Introduction Standard Deduction Amount Standard Deduction for Dependents Who Should ItemizeWhen to itemize. How do i do my 2012 taxes Married persons who filed separate returns. How do i do my 2012 taxes What's New Standard deduction increased. How do i do my 2012 taxes  The standard deduction for some taxpayers who do not itemize their deductions on Schedule A (Form 1040) is higher for 2013 than it was for 2012. How do i do my 2012 taxes The amount depends on your filing status. How do i do my 2012 taxes You can use the 2013 Standard Deduction Tables in this chapter to figure your standard deduction. How do i do my 2012 taxes Introduction This chapter discusses the following topics. How do i do my 2012 taxes How to figure the amount of your standard deduction. How do i do my 2012 taxes The standard deduction for dependents. How do i do my 2012 taxes Who should itemize deductions. How do i do my 2012 taxes Most taxpayers have a choice of either taking a standard deduction or itemizing their deductions. How do i do my 2012 taxes If you have a choice, you can use the method that gives you the lower tax. How do i do my 2012 taxes The standard deduction is a dollar amount that reduces your taxable income. How do i do my 2012 taxes It is a benefit that eliminates the need for many taxpayers to itemize actual deductions, such as medical expenses, charitable contributions, and taxes, on Schedule A (Form 1040). How do i do my 2012 taxes The standard deduction is higher for taxpayers who: Are 65 or older, or Are blind. How do i do my 2012 taxes You benefit from the standard deduction if your standard deduction is more than the total of your allowable itemized deductions. How do i do my 2012 taxes Persons not eligible for the standard deduction. How do i do my 2012 taxes   Your standard deduction is zero and you should itemize any deductions you have if: Your filing status is married filing separately, and your spouse itemizes deductions on his or her return, You are filing a tax return for a short tax year because of a change in your annual accounting period, or You are a nonresident or dual-status alien during the year. How do i do my 2012 taxes You are considered a dual-status alien if you were both a nonresident and resident alien during the year. How do i do my 2012 taxes Note. How do i do my 2012 taxes If you are a nonresident alien who is married to a U. How do i do my 2012 taxes S. How do i do my 2012 taxes citizen or resident alien at the end of the year, you can choose to be treated as a U. How do i do my 2012 taxes S. How do i do my 2012 taxes resident. How do i do my 2012 taxes (See Publication 519, U. How do i do my 2012 taxes S. How do i do my 2012 taxes Tax Guide for Aliens. How do i do my 2012 taxes ) If you make this choice, you can take the standard deduction. How do i do my 2012 taxes If an exemption for you can be claimed on another person's return (such as your parents' return), your standard deduction may be limited. How do i do my 2012 taxes See Standard Deduction for Dependents, later. How do i do my 2012 taxes Standard Deduction Amount The standard deduction amount depends on your filing status, whether you are 65 or older or blind, and whether an exemption can be claimed for you by another taxpayer. How do i do my 2012 taxes Generally, the standard deduction amounts are adjusted each year for inflation. How do i do my 2012 taxes The standard deduction amounts for most people are shown in Table 20-1. How do i do my 2012 taxes Decedent's final return. How do i do my 2012 taxes   The standard deduction for a decedent's final tax return is the same as it would have been had the decedent continued to live. How do i do my 2012 taxes However, if the decedent was not 65 or older at the time of death, the higher standard deduction for age cannot be claimed. How do i do my 2012 taxes Higher Standard Deduction for Age (65 or Older) If you are age 65 or older on the last day of the year and do not itemize deductions, you are entitled to a higher standard deduction. How do i do my 2012 taxes You are considered 65 on the day before your 65th birthday. How do i do my 2012 taxes Therefore, you can take a higher standard deduction for 2013 if you were born before January 2, 1949. How do i do my 2012 taxes Use Table 20-2 to figure the standard deduction amount. How do i do my 2012 taxes Higher Standard Deduction for Blindness If you are blind on the last day of the year and you do not itemize deductions, you are entitled to a higher standard deduction. How do i do my 2012 taxes Not totally blind. How do i do my 2012 taxes   If you are not totally blind, you must get a certified statement from an eye doctor (ophthalmologist or optometrist) that: You cannot see better than 20/200 in the better eye with glasses or contact lenses, or Your field of vision is 20 degrees or less. How do i do my 2012 taxes   If your eye condition is not likely to improve beyond these limits, the statement should include this fact. How do i do my 2012 taxes You must keep the statement in your records. How do i do my 2012 taxes   If your vision can be corrected beyond these limits only by contact lenses that you can wear only briefly because of pain, infection, or ulcers, you can take the higher standard deduction for blindness if you otherwise qualify. How do i do my 2012 taxes Spouse 65 or Older or Blind You can take the higher standard deduction if your spouse is age 65 or older or blind and: You file a joint return, or You file a separate return and can claim an exemption for your spouse because your spouse had no gross income and cannot be claimed as a dependent by another taxpayer. How do i do my 2012 taxes You cannot claim the higher standard deduction for an individual other than yourself and your spouse. How do i do my 2012 taxes Examples The following examples illustrate how to determine your standard deduction using Tables 20-1 and 20-2. How do i do my 2012 taxes Example 1. How do i do my 2012 taxes Larry, 46, and Donna, 33, are filing a joint return for 2013. How do i do my 2012 taxes Neither is blind, and neither can be claimed as a dependent. How do i do my 2012 taxes They decide not to itemize their deductions. How do i do my 2012 taxes They use Table 20-1. How do i do my 2012 taxes Their standard deduction is $12,200. How do i do my 2012 taxes Example 2. How do i do my 2012 taxes The facts are the same as in Example 1 except that Larry is blind at the end of 2013. How do i do my 2012 taxes Larry and Donna use Table 20-2. How do i do my 2012 taxes Their standard deduction is $13,400. How do i do my 2012 taxes Example 3. How do i do my 2012 taxes Bill and Lisa are filing a joint return for 2013. How do i do my 2012 taxes Both are over age 65. How do i do my 2012 taxes Neither is blind, and neither can be claimed as a dependent. How do i do my 2012 taxes If they do not itemize deductions, they use Table 20-2. How do i do my 2012 taxes Their standard deduction is $14,600. How do i do my 2012 taxes Standard Deduction for Dependents The standard deduction for an individual who can be claimed as a dependent on another person's tax return is generally limited to the greater of: $1,000, or The individual's earned income for the year plus $350 (but not more than the regular standard deduction amount, generally $6,100). How do i do my 2012 taxes However, if the individual is 65 or older or blind, the standard deduction may be higher. How do i do my 2012 taxes If you (or your spouse, if filing jointly) can be claimed as a dependent on someone else's return, use Table 20-3 to determine your standard deduction. How do i do my 2012 taxes Earned income defined. How do i do my 2012 taxes   Earned income is salaries, wages, tips, professional fees, and other amounts received as pay for work you actually perform. How do i do my 2012 taxes    For purposes of the standard deduction, earned income also includes any part of a scholarship or fellowship grant that you must include in your gross income. How do i do my 2012 taxes See Scholarships and fellowships in chapter 12 for more information on what qualifies as a scholarship or fellowship grant. How do i do my 2012 taxes Example 1. How do i do my 2012 taxes Michael is single. How do i do my 2012 taxes His parents can claim an exemption for him on their 2013 tax return. How do i do my 2012 taxes He has interest income of $780 and wages of $150. How do i do my 2012 taxes He has no itemized deductions. How do i do my 2012 taxes Michael uses Table 20-3 to find his standard deduction. How do i do my 2012 taxes He enters $150 (his earned income) on line 1, $500 ($150 + $350) on line 3, $1,000 (the larger of $500 and $1,000) on line 5, and $6,100 on line 6. How do i do my 2012 taxes His standard deduction, on line 7a, is $1,000 (the smaller of $1,000 and $6,100). How do i do my 2012 taxes Example 2. How do i do my 2012 taxes Joe, a 22-year-old full-time college student, can be claimed as a dependent on his parents' 2013 tax return. How do i do my 2012 taxes Joe is married and files a separate return. How do i do my 2012 taxes His wife does not itemize deductions on her separate return. How do i do my 2012 taxes Joe has $1,500 in interest income and wages of $3,800. How do i do my 2012 taxes He has no itemized deductions. How do i do my 2012 taxes Joe finds his standard deduction by using Table 20-3. How do i do my 2012 taxes He enters his earned income, $3,800 on line 1. How do i do my 2012 taxes He adds lines 1 and 2 and enters $4,150 on line 3. How do i do my 2012 taxes On line 5, he enters $4,150, the larger of lines 3 and 4. How do i do my 2012 taxes Because Joe is married filing a separate return, he enters $6,100 on line 6. How do i do my 2012 taxes On line 7a he enters $4,150 as his standard deduction because it is smaller than $6,100, the amount on line 6. How do i do my 2012 taxes Example 3. How do i do my 2012 taxes Amy, who is single, can be claimed as a dependent on her parents' 2013 tax return. How do i do my 2012 taxes She is 18 years old and blind. How do i do my 2012 taxes She has interest income of $1,300 and wages of $2,900. How do i do my 2012 taxes She has no itemized deductions. How do i do my 2012 taxes Amy uses Table 20-3 to find her standard deduction. How do i do my 2012 taxes She enters her wages of $2,900 on line 1. How do i do my 2012 taxes She adds lines 1 and 2 and enters $3,250 on line 3. How do i do my 2012 taxes On line 5, she enters $3,250, the larger of lines 3 and 4. How do i do my 2012 taxes Because she is single, Amy enters $6,100 on line 6. How do i do my 2012 taxes She enters $3,250 on line 7a. How do i do my 2012 taxes This is the smaller of the amounts on lines 5 and 6. How do i do my 2012 taxes Because she checked one box in the top part of the worksheet, she enters $1,500 on line 7b. How do i do my 2012 taxes She then adds the amounts on lines 7a and 7b and enters her standard deduction of $4,750 on line 7c. How do i do my 2012 taxes Example 4. How do i do my 2012 taxes Ed is single. How do i do my 2012 taxes His parents can claim an exemption for him on their 2013 tax return. How do i do my 2012 taxes He has wages of $7,000, interest income of $500, and a business loss of $3,000. How do i do my 2012 taxes He has no itemized deductions. How do i do my 2012 taxes Ed uses Table 20-3 to figure his standard deduction. How do i do my 2012 taxes He enters $4,000 ($7,000 - $3,000) on line 1. How do i do my 2012 taxes He adds lines 1 and 2 and enters $4,350 on line 3. How do i do my 2012 taxes On line 5 he enters $4,350, the larger of lines 3 and 4. How do i do my 2012 taxes Because he is single, Ed enters $6,100 on line 6. How do i do my 2012 taxes On line 7a he enters $4,350 as his standard deduction because it is smaller than $6,100, the amount on line 6. How do i do my 2012 taxes Who Should Itemize You should itemize deductions if your total deductions are more than the standard deduction amount. How do i do my 2012 taxes Also, you should itemize if you do not qualify for the standard deduction, as discussed earlier under Persons not eligible for the standard deduction . How do i do my 2012 taxes You should first figure your itemized deductions and compare that amount to your standard deduction to make sure you are using the method that gives you the greater benefit. How do i do my 2012 taxes You may be subject to a limit on some of your itemized deductions if your adjusted gross income is more than: $250,000 if single ($275,000 if head of household, $300,000 if married filing jointly or qualifying widow(er); or $150,000 if married filing separately). How do i do my 2012 taxes See chapter 29 or the instructions for Schedule A (Form 1040) for more information on figuring the correct amount of your itemized deductions. How do i do my 2012 taxes When to itemize. How do i do my 2012 taxes   You may benefit from itemizing your deductions on Schedule A (Form 1040) if you: Do not qualify for the standard deduction, or the amount you can claim is limited, Had large uninsured medical and dental expenses during the year, Paid interest and taxes on your home, Had large unreimbursed employee business expenses or other miscellaneous deductions, Had large uninsured casualty or theft losses, Made large contributions to qualified charities, or Have total itemized deductions that are more than the standard deduction to which you otherwise are entitled. How do i do my 2012 taxes These deductions are explained in chapters 21–28. How do i do my 2012 taxes    If you decide to itemize your deductions, complete Schedule A and attach it to your Form 1040. How do i do my 2012 taxes Enter the amount from Schedule A, line 29, on Form 1040, line 40. How do i do my 2012 taxes Electing to itemize for state tax or other purposes. How do i do my 2012 taxes   Even if your itemized deductions are less than your standard deduction, you can elect to itemize deductions on your federal return rather than take the standard deduction. How do i do my 2012 taxes You may want to do this if, for example, the tax benefit of itemizing your deductions on your state tax return is greater than the tax benefit you lose on your federal return by not taking the standard deduction. How do i do my 2012 taxes To make this election, you must check the box on line 30 of Schedule A. How do i do my 2012 taxes Changing your mind. How do i do my 2012 taxes   If you do not itemize your deductions and later find that you should have itemized — or if you itemize your deductions and later find you should not have — you can change your return by filing Form 1040X, Amended U. How do i do my 2012 taxes S. How do i do my 2012 taxes Individual Income Tax Return. How do i do my 2012 taxes See Amended Returns and Claims for Refund in chapter 1 for more information on amended returns. How do i do my 2012 taxes Married persons who filed separate returns. How do i do my 2012 taxes   You can change methods of taking deductions only if you and your spouse both make the same changes. How do i do my 2012 taxes Both of you must file a consent to assessment for any additional tax either one may owe as a result of the change. How do i do my 2012 taxes    You and your spouse can use the method that gives you the lower total tax, even though one of you may pay more tax than you would have paid by using the other method. How do i do my 2012 taxes You both must use the same method of claiming deductions. How do i do my 2012 taxes If one itemizes deductions, the other should itemize because he or she will not qualify for the standard deduction. How do i do my 2012 taxes See Persons not eligible for the standard deduction , earlier. How do i do my 2012 taxes 2013 Standard Deduction Tables If you are married filing a separate return and your spouse itemizes deductions, or if you are a dual-status alien, you cannot take the standard deduction even if you were born before January 2, 1949, or are blind. How do i do my 2012 taxes Table 20-1. How do i do my 2012 taxes Standard Deduction Chart for Most People* If your filing status is. How do i do my 2012 taxes . How do i do my 2012 taxes . How do i do my 2012 taxes Your standard deduction is: Single or Married filing separately $6,100 Married filing jointly or Qualifying widow(er) with dependent child 12,200 Head of household 8,950 *Do not use this chart if you were born before January 2, 1949, are blind, or if someone else can claim you (or your spouse if filing jointly) as a dependent. How do i do my 2012 taxes Use Table 20-2 or 20-3 instead. How do i do my 2012 taxes Table 20-2. How do i do my 2012 taxes Standard Deduction Chart for People Born Before January 2, 1949, or Who are Blind Check the correct number of boxes below. How do i do my 2012 taxes Then go to the chart. How do i do my 2012 taxes You: Born before January 2, 1949 □ Blind □ Your spouse, if claiming spouse's exemption: Born before January 2, 1949 □ Blind □ Total number of boxes checked   IF  your filing status is. How do i do my 2012 taxes . How do i do my 2012 taxes . How do i do my 2012 taxes AND the number in the box above is. How do i do my 2012 taxes . How do i do my 2012 taxes . How do i do my 2012 taxes THEN your standard deduction is. How do i do my 2012 taxes . How do i do my 2012 taxes . How do i do my 2012 taxes Single 1 $7,600   2 9,100 Married filing jointly 1 $13,400 or Qualifying 2 14,600 widow(er) with 3 15,800 dependent child 4 17,000 Married filing 1 $7,300 separately 2 8,500   3 9,700   4 10,900 Head of household 1 $10,450   2 11,950 *If someone else can claim you (or your spouse if filing jointly) as a dependent, use Table 20-3 instead. How do i do my 2012 taxes Table 20-3. How do i do my 2012 taxes Standard Deduction Worksheet for Dependents Use this worksheet only if someone else can claim you (or your spouse if filing jointly) as a dependent. How do i do my 2012 taxes Check the correct number of boxes below. How do i do my 2012 taxes Then go to the worksheet. How do i do my 2012 taxes You:   Born before January 2, 1949 □ Blind □ Your spouse, if claiming spouse's exemption: Born before January 2, 1949 □ Blind □ Total number of boxes checked 1. How do i do my 2012 taxes Enter your earned income (defined below). How do i do my 2012 taxes If none, enter -0-. How do i do my 2012 taxes 1. How do i do my 2012 taxes   2. How do i do my 2012 taxes Additional amount. How do i do my 2012 taxes 2. How do i do my 2012 taxes $350 3. How do i do my 2012 taxes Add lines 1 and 2. How do i do my 2012 taxes 3. How do i do my 2012 taxes   4. How do i do my 2012 taxes Minimum standard deduction. How do i do my 2012 taxes 4. How do i do my 2012 taxes $1,000 5. How do i do my 2012 taxes Enter the larger of line 3 or line 4. How do i do my 2012 taxes 5. How do i do my 2012 taxes   6. How do i do my 2012 taxes Enter the amount shown below for your filing status. How do i do my 2012 taxes Single or Married filing separately—$6,100 Married filing jointly—$12,200 Head of household—$8,950 6. How do i do my 2012 taxes   7. How do i do my 2012 taxes Standard deduction. How do i do my 2012 taxes         a. How do i do my 2012 taxes Enter the smaller of line 5 or line 6. How do i do my 2012 taxes If born after January 1, 1949, and not blind, stop here. How do i do my 2012 taxes This is your standard deduction. How do i do my 2012 taxes Otherwise, go on to line 7b. How do i do my 2012 taxes 7a. How do i do my 2012 taxes     b. How do i do my 2012 taxes If born before January 2, 1949, or blind, multiply $1,500 ($1,200 if married) by the number in the box above. How do i do my 2012 taxes 7b. How do i do my 2012 taxes     c. How do i do my 2012 taxes Add lines 7a and 7b. How do i do my 2012 taxes This is your standard deduction for 2013. How do i do my 2012 taxes 7c. How do i do my 2012 taxes   Earned income includes wages, salaries, tips, professional fees, and other compensation received for personal services you performed. How do i do my 2012 taxes It also includes any amount received as a scholarship that you must include in your income. How do i do my 2012 taxes Prev  Up  Next   Home   More Online Publications