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How To Amend 2012 Tax Return

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How To Amend 2012 Tax Return

How to amend 2012 tax return 10. How to amend 2012 tax return   Retirement Savings Contributions Credit (Saver's Credit) Table of Contents Full-time student. How to amend 2012 tax return Adjusted gross income. How to amend 2012 tax return Distributions received by spouse. How to amend 2012 tax return Testing period. How to amend 2012 tax return If you or your employer make eligible contributions (defined later) to a retirement plan, you may be able to take a credit of up to $1,000 (up to $2,000 if filing jointly). How to amend 2012 tax return This credit could reduce the federal income tax you pay dollar for dollar. How to amend 2012 tax return Can you claim the credit?   If you or your employer make eligible contributions to a retirement plan, you can claim the credit if all of the following apply. How to amend 2012 tax return You are not under age 18. How to amend 2012 tax return You are not a full-time student (explained next). How to amend 2012 tax return No one else, such as your parent(s), claims an exemption for you on their tax return. How to amend 2012 tax return Your adjusted gross income (defined later) is not more than: $59,000 for 2013 ($60,000 for 2014) if your filing status is married filing jointly, $44,250 for 2013 ($45,000 for 2014) if your filing status is head of household (with qualifying person), or $29,500 for 2013 ($30,000 for 2014) if your filing status is single, married filing separately, or qualifying widow(er) with dependent child. How to amend 2012 tax return Full-time student. How to amend 2012 tax return   You are a full-time student if, during some part of each of 5 calendar months (not necessarily consecutive) during the calendar year, you are either: A full-time student at a school that has a regular teaching staff, course of study, and regularly enrolled body of students in attendance, or A student taking a full-time, on-farm training course given by either a school that has a regular teaching staff, course of study, and regularly enrolled body of students in attendance, or a state, county, or local government. How to amend 2012 tax return You are a full-time student if you are enrolled for the number of hours or courses the school considers to be full-time. How to amend 2012 tax return Adjusted gross income. How to amend 2012 tax return   This is generally the amount on line 38 of your 2013 Form 1040 or line 22 of your 2013 Form 1040A. How to amend 2012 tax return However, you must add to that amount any exclusion or deduction claimed for the year for: Foreign earned income, Foreign housing costs, Income for bona fide residents of American Samoa, and Income from Puerto Rico. How to amend 2012 tax return Eligible contributions. How to amend 2012 tax return   These include: Contributions to a traditional or Roth IRA, Elective deferrals, including amounts designated as after-tax Roth contributions, to: A 401(k) plan (including a SIMPLE 401(k)), A section 403(b) annuity, An eligible deferred compensation plan of a state or local government (a governmental 457 plan), A SIMPLE IRA plan, or A salary reduction SEP, and Contributions to a section 501(c)(18) plan. How to amend 2012 tax return They also include voluntary after-tax employee contributions to a tax-qualified retirement plan or a section 403(b) annuity. How to amend 2012 tax return For purposes of the credit, an employee contribution will be voluntary as long as it is not required as a condition of employment. How to amend 2012 tax return Reducing eligible contributions. How to amend 2012 tax return   Reduce your eligible contributions (but not below zero) by the total distributions you received during the testing period (defined later) from any IRA, plan, or annuity included earlier under Eligible contributions. How to amend 2012 tax return Also reduce your eligible contributions by any distribution from a Roth IRA that is not rolled over, even if the distribution is not taxable. How to amend 2012 tax return      Do not reduce your eligible contributions by any of the following: The portion of any distribution which is not includible in income because it is a trustee-to-trustee transfer or a rollover distribution. How to amend 2012 tax return Any distribution that is a return of a contribution to an IRA (including a Roth IRA) made during the year for which you claim the credit if: The distribution is made before the due date (including extensions) of your tax return for that year, You do not take a deduction for the contribution, and The distribution includes any income attributable to the contribution. How to amend 2012 tax return Loans from a qualified employer plan treated as a distribution. How to amend 2012 tax return Distributions of excess contributions or deferrals (and income attributable to excess contributions and deferrals). How to amend 2012 tax return Distributions of dividends paid on stock held by an employee stock ownership plan under section 404(k). How to amend 2012 tax return Distributions from an eligible retirement plan that are converted or rolled over to a Roth IRA. How to amend 2012 tax return Distributions from a military retirement plan. How to amend 2012 tax return Distributions received by spouse. How to amend 2012 tax return   Any distributions your spouse receives are treated as received by you if you file a joint return with your spouse both for the year of the distribution and for the year for which you claim the credit. How to amend 2012 tax return Testing period. How to amend 2012 tax return   The testing period consists of: The year in which you claim the credit, The 2 years before the year in which you claim the credit, and The period after the end of the year in which you claim the credit and before the due date of the return (including extensions) for filing your return for the year in which you claimed the credit. How to amend 2012 tax return Example. How to amend 2012 tax return You and your spouse filed joint returns in 2011 and 2012, and plan to do so in 2013 and 2014. How to amend 2012 tax return You received a taxable distribution from a qualified plan in 2011 and a taxable distribution from an eligible section 457(b) deferred compensation plan in 2012. How to amend 2012 tax return Your spouse received taxable distributions from a Roth IRA in 2013 and tax-free distributions from a Roth IRA in 2014 before April 15. How to amend 2012 tax return You made eligible contributions to an IRA in 2013 and you otherwise qualify for this credit. How to amend 2012 tax return You must reduce the amount of your qualifying contributions in 2013 by the total of the distributions you and your spouse received in 2011, 2012, 2013, and 2014. How to amend 2012 tax return Maximum eligible contributions. How to amend 2012 tax return   After your contributions are reduced, the maximum annual contribution on which you can base the credit is $2,000 per person. How to amend 2012 tax return Effect on other credits. How to amend 2012 tax return   The amount of this credit will not change the amount of your refundable tax credits. How to amend 2012 tax return A refundable tax credit, such as the earned income credit or the additional child tax credit, is an amount that you would receive as a refund even if you did not otherwise owe any taxes. How to amend 2012 tax return Maximum credit. How to amend 2012 tax return   This is a nonrefundable credit. How to amend 2012 tax return The amount of the credit in any year cannot be more than the amount of tax that you would otherwise pay (not counting any refundable credits or the adoption credit) in any year. How to amend 2012 tax return If your tax liability is reduced to zero because of other nonrefundable credits, such as the education credits, then you will not be entitled to this credit. How to amend 2012 tax return How to figure and report the credit. How to amend 2012 tax return   The amount of the credit you can get is based on the contributions you make and your credit rate. How to amend 2012 tax return The credit rate can be as low as 10% or as high as 50%. How to amend 2012 tax return Your credit rate depends on your income and your filing status. How to amend 2012 tax return See Form 8880, Credit for Qualified Retirement Savings Contributions, to determine your credit rate. How to amend 2012 tax return   The maximum contribution taken into account is $2,000 per person. How to amend 2012 tax return On a joint return, up to $2,000 is taken into account for each spouse. How to amend 2012 tax return   Figure the credit on Form 8880. How to amend 2012 tax return Report the credit on line 50 of your Form 1040 or line 32 of your Form 1040A, and attach Form 8880 to your return. How to amend 2012 tax return Prev  Up  Next   Home   More Online Publications
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The How To Amend 2012 Tax Return

How to amend 2012 tax return 1. How to amend 2012 tax return   Tax Withholding for 2014 Table of Contents Introduction Useful Items - You may want to see: Salaries and WagesDetermining Amount of Tax Withheld Using Form W-4 Completing Form W-4 and Worksheets Getting the Right Amount of Tax Withheld Rules Your Employer Must Follow Exemption From Withholding Supplemental Wages Penalties Tips Taxable Fringe BenefitsSpecial rule. How to amend 2012 tax return Exceptions. How to amend 2012 tax return Sick Pay Pensions and AnnuitiesPeriodic Payments Nonperiodic Payments Eligible Rollover Distributions Choosing Not To Have Income Tax Withheld Gambling WinningsException. How to amend 2012 tax return Identical wagers. How to amend 2012 tax return Unemployment Compensation Federal Payments Backup WithholdingTaxpayer identification number. How to amend 2012 tax return Underreported interest or dividends. How to amend 2012 tax return Introduction This chapter discusses income tax withholding on: Salaries and wages, Tips, Taxable fringe benefits, Sick pay, Pensions and annuities, Gambling winnings, Unemployment compensation, and Certain federal payments. How to amend 2012 tax return This chapter explains in detail the rules for withholding tax from each of these types of income. How to amend 2012 tax return The discussion of salaries and wages includes an explanation of how to complete Form W-4. How to amend 2012 tax return This chapter also covers backup withholding on interest, dividends, and other payments. How to amend 2012 tax return Useful Items - You may want to see: Form (and Instructions) W-4 Employee's Withholding Allowance Certificate W-4P Withholding Certificate for Pension or Annuity Payments W-4S Request for Federal Income Tax Withholding From Sick Pay W-4V Voluntary Withholding Request See chapter 5 of this publication for information about getting these publications and forms. How to amend 2012 tax return Salaries and Wages Income tax is withheld from the pay of most employees. How to amend 2012 tax return Your pay includes your regular pay, bonuses, commissions, and vacation allowances. How to amend 2012 tax return It also includes reimbursements and other expense allowances paid under a nonaccountable plan. How to amend 2012 tax return See Supplemental Wages , later, for definitions of accountable and nonaccountable plans. How to amend 2012 tax return If your income is low enough that you will not have to pay income tax for the year, you may be exempt from withholding. How to amend 2012 tax return This is explained under Exemption From Withholding , later. How to amend 2012 tax return You can ask your employer to withhold income tax from noncash wages and other wages not subject to withholding. How to amend 2012 tax return If your employer does not agree to withhold tax, or if not enough is withheld, you may have to pay estimated tax, as discussed in chapter 2. How to amend 2012 tax return Military retirees. How to amend 2012 tax return   Military retirement pay is treated in the same manner as regular pay for income tax withholding purposes, even though it is treated as a pension or annuity for other tax purposes. How to amend 2012 tax return Household workers. How to amend 2012 tax return   If you are a household worker, you can ask your employer to withhold income tax from your pay. How to amend 2012 tax return A household worker is an employee who performs household work in a private home, local college club, or local fraternity or sorority chapter. How to amend 2012 tax return   Tax is withheld only if you want it withheld and your employer agrees to withhold it. How to amend 2012 tax return If you do not have enough income tax withheld, you may have to pay estimated tax, as discussed in chapter 2. How to amend 2012 tax return Farmworkers. How to amend 2012 tax return   Generally, income tax is withheld from your cash wages for work on a farm unless your employer both: Pays you cash wages of less than $150 during the year, and Has expenditures for agricultural labor totaling less than $2,500 during the year. How to amend 2012 tax return Differential wage payments. How to amend 2012 tax return   When employees are on leave from employment for military duty, some employers make up the difference between the military pay and civilian pay. How to amend 2012 tax return Payments to an employee who is on active duty for a period of more than 30 days will be subject to income tax withholding, but not subject to social security or Medicare taxes. How to amend 2012 tax return The wages and withholding will be reported on Form W-2, Wage and Tax Statement. How to amend 2012 tax return Determining Amount of Tax Withheld Using Form W-4 The amount of income tax your employer withholds from your regular pay depends on two things. How to amend 2012 tax return The amount you earn in each payroll period. How to amend 2012 tax return The information you give your employer on Form W-4. How to amend 2012 tax return Form W-4 includes four types of information that your employer will use to figure your withholding. How to amend 2012 tax return Whether to withhold at the single rate or at the lower married rate. How to amend 2012 tax return How many withholding allowances you claim (each allowance reduces the amount withheld). How to amend 2012 tax return Whether you want an additional amount withheld. How to amend 2012 tax return Whether you are claiming an exemption from withholding in 2014. How to amend 2012 tax return See Exemption From Withholding , later. How to amend 2012 tax return Note. How to amend 2012 tax return You must specify a filing status and a number of withholding allowances on Form W-4. How to amend 2012 tax return You cannot specify only a dollar amount of withholding. How to amend 2012 tax return New Job When you start a new job, you must fill out a Form W-4 and give it to your employer. How to amend 2012 tax return Your employer should have copies of the form. How to amend 2012 tax return If you need to change the information later, you must fill out a new form. How to amend 2012 tax return If you work only part of the year (for example, you start working after the beginning of the year), too much tax may be withheld. How to amend 2012 tax return You may be able to avoid overwithholding if your employer agrees to use the part-year method. How to amend 2012 tax return See Part-Year Method , later, for more information. How to amend 2012 tax return Employee also receiving pension income. How to amend 2012 tax return   If you receive pension or annuity income and begin a new job, you will need to file Form W-4 with your new employer. How to amend 2012 tax return However, you can choose to split your withholding allowances between your pension and job in any manner. How to amend 2012 tax return Changing Your Withholding During the year changes may occur to your marital status, exemptions, adjustments, deductions, or credits you expect to claim on your tax return. How to amend 2012 tax return When this happens, you may need to give your employer a new Form W-4 to change your withholding status or number of allowances. How to amend 2012 tax return If the changes reduce the number of allowances you are allowed to claim or changes your marital status from married to single, you must give your employer a new Form W-4 within 10 days. How to amend 2012 tax return See Marital Status (Line 3 of Form W-4) and Withholding Allowances (Line 5 of Form W-4) , later. How to amend 2012 tax return Generally, you can submit a new Form W-4 whenever you wish to change your withholding allowances for any other reason. How to amend 2012 tax return See Table 1-1 for examples of personal and financial changes you should consider. How to amend 2012 tax return Table 1-1. How to amend 2012 tax return Personal and Financial Changes Factor Examples Lifestyle change Marriage Divorce Birth or adoption of child Loss of an exemption Purchase of a new home Retirement Filing chapter 11 bankruptcy Wage income You or your spouse start or stop working, or start or stop a second job Change in the amount of taxable income not subject to withholding Interest income Dividends Capital gains Self-employment income IRA (including certain Roth  IRA) distributions Change in the amount of adjustments to income IRA deduction Student loan interest deduction Alimony expense Change in the amount of itemized deductions or tax credits Medical expenses Taxes Interest expense Gifts to charity Job expenses Dependent care expenses Education credit Child tax credit Earned income credit If you change the number of your withholding allowances, you can request that your employer withhold using the Cumulative Wage Method , explained later. How to amend 2012 tax return Checking Your Withholding After you have given your employer a Form W-4, you can check to see whether the amount of tax withheld from your pay is too much or too little. How to amend 2012 tax return If too much or too little tax is being withheld, you should give your employer a new Form W-4 to change your withholding. How to amend 2012 tax return You can get a blank Form W-4 from your employer or print the form from IRS. How to amend 2012 tax return gov. How to amend 2012 tax return You should try to have your withholding match your actual tax liability. How to amend 2012 tax return If not enough tax is withheld, you will owe tax at the end of the year and may have to pay interest and a penalty. How to amend 2012 tax return If too much tax is withheld, you will lose the use of that money until you get your refund. How to amend 2012 tax return Always check your withholding if there are personal or financial changes in your life or changes in the law that might change your tax liability. How to amend 2012 tax return See Table 1-1 for examples. How to amend 2012 tax return Note. How to amend 2012 tax return You cannot give your employer a payment to cover federal income tax withholding on salaries and wages for past pay periods or a payment for estimated tax. How to amend 2012 tax return When Should You Check Your Withholding? The earlier in the year you check your withholding, the easier it is to get the right amount of tax withheld. How to amend 2012 tax return You should check your withholding when any of the following situations occur. How to amend 2012 tax return You receive a paycheck stub (statement) covering a full pay period in 2014, showing tax withheld based on 2014 tax rates. How to amend 2012 tax return You prepare your 2013 tax return and get a: Big refund, or Balance due that is: More than you can comfortably pay, or Subject to a penalty. How to amend 2012 tax return There are changes in your life or financial situation that affect your tax liability. How to amend 2012 tax return See Table 1-1. How to amend 2012 tax return There are changes in the tax law that affect your tax liability. How to amend 2012 tax return How Do You Check Your Withholding? You can use the worksheets and tables in this publication to see if you are having the right amount of tax withheld. How to amend 2012 tax return You can also use the IRS Withholding calculator at www. How to amend 2012 tax return irs. How to amend 2012 tax return gov/individuals. How to amend 2012 tax return If you use the worksheets and tables in this publication, follow these steps. How to amend 2012 tax return Fill out Worksheet 1-5 to project your total federal income tax liability for 2014. How to amend 2012 tax return Fill out Worksheet 1-7 to project your total federal withholding for 2014 and compare that with your projected tax liability from Worksheet 1-5. How to amend 2012 tax return If you are not having enough tax withheld, line 6 of Worksheet 1-7 will show you how much more to have withheld each payday. How to amend 2012 tax return For ways to increase the amount of tax withheld, see How Do You Increase Your Withholding? If line 5 of Worksheet 1-7 shows that you are having more tax withheld than necessary, see How Do You Decrease Your Withholding, for ways to decrease the amount of tax you have withheld each payday. How to amend 2012 tax return How Do You Increase Your Withholding? There are two ways to increase your withholding. How to amend 2012 tax return You can: Decrease the number of allowances you claim on Form W-4, or Enter an additional amount that you want withheld from each paycheck on Form W-4. How to amend 2012 tax return Requesting an additional amount withheld. How to amend 2012 tax return   You can request that an additional amount be withheld from each paycheck by following these steps. How to amend 2012 tax return Complete Worksheets 1-5 and 1-7. How to amend 2012 tax return Complete a new Form W-4 if the amount on Worksheet 1-7, line 5: Is more than you want to pay with your tax return or in estimated tax payments throughout the year, or Would cause you to pay a penalty when you file your tax return for 2014. How to amend 2012 tax return Enter on your new Form W-4, the same number of withholding allowances your employer now uses for your withholding. How to amend 2012 tax return This is the number of allowances you entered on the last Form W-4 you gave your employer. How to amend 2012 tax return Enter on your new Form W-4, the amount from Worksheet 1-7, line 6. How to amend 2012 tax return Give your newly completed Form W-4 to your employer. How to amend 2012 tax return   If you have this additional amount withheld from your pay each payday, you should avoid owing a large amount at the end of the year. How to amend 2012 tax return Example. How to amend 2012 tax return Early in 2014, Steve Miller used Worksheets 1-5, 1-6, and 1-7 to project his 2014 tax liability ($4,316) and his withholding for the year ($3,516). How to amend 2012 tax return Steve's tax will be underwithheld by $800 ($4,316 − $3,516). How to amend 2012 tax return His choices are to pay this amount when he files his 2014 tax return, make estimated tax payments, or increase his withholding now. How to amend 2012 tax return Steve gets a new Form W-4 from his employer, who tells him that there are 50 paydays remaining in 2014. How to amend 2012 tax return Steve completes the new Form W-4 as before, entering the same number of withholding allowances as before, but, in addition, entering $16 ($800 ÷ 50) on the form as the additional amount to be withheld from his pay each payday. How to amend 2012 tax return He gives the completed form to his employer. How to amend 2012 tax return What if I have more than one job or my spouse also has a job?   You are more likely to need to increase your withholding if you have more than one job or if you are married filing jointly and your spouse also works. How to amend 2012 tax return If this is the case, you can increase your withholding for one or more of the jobs. How to amend 2012 tax return   You can apply the amount on Worksheet 1-7, line 5, to only one job or divide it between the jobs any way you wish. How to amend 2012 tax return For each job, determine the extra amount that you want to apply to that job and divide that amount by the number of paydays remaining in 2014 for that job. How to amend 2012 tax return This will give you the additional amount to enter on the Form W-4 you will file for that job. How to amend 2012 tax return You need to give your employer a new Form W-4 for each job for which you are changing your withholding. How to amend 2012 tax return Example. How to amend 2012 tax return Meg Green works in a store and earns $46,000 a year. How to amend 2012 tax return Her husband, John, works full-time in manufacturing and earns $68,000 a year. How to amend 2012 tax return In 2014, they will also have $184 in taxable interest and $1,000 of other taxable income. How to amend 2012 tax return They expect to file a joint income tax return. How to amend 2012 tax return Meg and John complete Worksheets 1-5, 1-6, and 1-7. How to amend 2012 tax return Line 5 of Worksheet 1-7 shows that they will owe an additional $4,459 after subtracting their withholding for the year. How to amend 2012 tax return They can divide the $4,459 any way they want. How to amend 2012 tax return They can enter an additional amount on either of their Forms W-4, or divide it between them. How to amend 2012 tax return They decide to have the additional amount withheld from John's wages, so they enter $91 ($4,459 ÷ 49 remaining paydays) on his Form W-4. How to amend 2012 tax return Both claim the same number of allowances as before. How to amend 2012 tax return How Do You Decrease Your Withholding? If your completed Worksheets 1-5 and 1-7 show that you may have more tax withheld than your projected tax liability for 2014, you may be able to decrease your withholding. How to amend 2012 tax return There are two ways to do this. How to amend 2012 tax return You can: Decrease any additional amount you are having withheld, or Increase the number of allowances you claim on Form W-4. How to amend 2012 tax return You can claim only the number of allowances to which you are entitled. How to amend 2012 tax return To see if you can decrease your withholding by increasing your allowances, see the Form W-4 instructions and the rest of this publication. How to amend 2012 tax return Increasing the number of allowances. How to amend 2012 tax return   Figure and increase the number of withholding allowances you can claim as follows. How to amend 2012 tax return On a new Form W-4, complete the Personal Allowances Worksheet. How to amend 2012 tax return If you plan to itemize deductions, claim adjustments to income, or claim tax credits, complete a new Deductions and Adjustments Worksheet. How to amend 2012 tax return If you plan to claim tax credits, see Converting Credits to Withholding Allowances, later. How to amend 2012 tax return If you meet the criteria on line H of the Form W-4 Personal Allowances Worksheet, complete a new Two-Earners/Multiple Jobs Worksheet. How to amend 2012 tax return If the number of allowances you can claim on Form W-4, is different from the number you already are claiming, give the newly completed Form W-4 to your employer. How to amend 2012 tax return Converting Credits to Withholding Allowances Table 1-2 , later, shows many of the tax credits you may be able to use to decrease your withholding. How to amend 2012 tax return The Form W-4 Personal Allowances Worksheet provides only rough adjustments for the child and dependent care credit and the child tax credit. How to amend 2012 tax return Complete Worksheet 1-8 to figure these credits more accurately and also take other credits into account. How to amend 2012 tax return Include the amount from line 12 of Worksheet 1-8 in the total on line 5 of the Deductions and Adjustments Worksheet. How to amend 2012 tax return Then complete the Deductions and Adjustments Worksheet and the rest of Form W-4. How to amend 2012 tax return If you take the child and dependent care credit into account on Worksheet 1-8, enter -0- on line F of the Personal Allowances Worksheet. How to amend 2012 tax return If you take the child tax credit into account on Worksheet 1-8, enter -0- on line G of the Personal Allowances Worksheet. How to amend 2012 tax return Example. How to amend 2012 tax return Brett and Alyssa Davis are married and expect to file a joint return for 2014. How to amend 2012 tax return Their expected taxable income from all sources is $68,000. How to amend 2012 tax return They expect to have $15,900 of itemized deductions. How to amend 2012 tax return Their projected tax credits include a child and dependent care credit of $960 and an adoption credit of $1,500. How to amend 2012 tax return The Davis' complete Worksheet 1-8, as follows, to see whether they can convert their tax credits into additional withholding allowances. How to amend 2012 tax return Line 1, expected child and dependent care credit—$960. How to amend 2012 tax return Line 9, expected adoption credit—$1,500. How to amend 2012 tax return Line 10, total estimated tax credits—$2,460. How to amend 2012 tax return Line 11. How to amend 2012 tax return Their combined total income from all sources, $68,000, falls between $42,001 and $98,000 on the table for married filing jointly or qualifying widow(er). How to amend 2012 tax return The number to the right of this range is 6. How to amend 2012 tax return 7. How to amend 2012 tax return Line 12, multiply line 10 by line 11—$16,482. How to amend 2012 tax return Then the Davis' complete the Form W-4 worksheets. How to amend 2012 tax return Because they choose to account for their child and dependent care credit on the Deductions and Adjustments Worksheet, they enter -0- on line F of the Personal Allowances Worksheet and figure a new total for line H. How to amend 2012 tax return They take the result on line 12 of Worksheet 1-8, add it to their other adjustments on line 5 of the Form W-4 Deductions and Adjustments Worksheet, and complete the Form W-4 worksheets. How to amend 2012 tax return When Will Your New Form W-4 Go Into Effect? If the change is for the current year, your employer must put your new Form W-4 into effect no later than the start of the first payroll period ending on or after the 30th day after the day on which you give your employer your revised Form W-4. How to amend 2012 tax return If the change is for next year, your new Form W-4 will not take effect until next year. How to amend 2012 tax return Retirees Returning to the Workforce When you first began receiving your pension, you told the payer how much tax to withhold, if any, by completing Form W-4P, Withholding Certificate for Pension or Annuity Payments (or similar form). How to amend 2012 tax return However, if your retirement pay is from the military or certain deferred compensation plans, you completed Form W-4 instead of Form W-4P. How to amend 2012 tax return You completed either form based on your projected income at that time. How to amend 2012 tax return Now that you are returning to the workforce, your new Form W-4 (given to your employer) and your Form W-4 or W-4P (on file with your pension plan) must work together to determine the correct amount of withholding for your new amount of income. How to amend 2012 tax return The worksheets that come with Forms W-4 and W-4P are basically the same, so you can use either set of worksheets to figure out how many withholding allowances you are entitled to claim. How to amend 2012 tax return Start off with the Personal Allowances Worksheet. How to amend 2012 tax return Then, if you will be itemizing your deductions, claiming adjustments to income, or claiming tax credits when you file your tax return, complete the Deductions and Adjustments Worksheet. How to amend 2012 tax return The third worksheet is the most important for this situation. How to amend 2012 tax return Form W-4 calls it the Two-Earners/Multiple Jobs Worksheet, Form W-4P calls it the Multiple Pensions/More-Than-One-Income Worksheet—both are the same. How to amend 2012 tax return If you have more than one source of income, in order to have enough withholding to cover the tax on your higher income, you may need to claim fewer withholding allowances or request your employer to withhold an additional amount from each paycheck. How to amend 2012 tax return Once you have figured out how many allowances you are entitled to claim, look at the income from both your pension and your new job, and how often you receive payments. How to amend 2012 tax return It is your decision how to divide up your withholding allowances between these sources of income. How to amend 2012 tax return For example, you may want to “take home” most of your weekly paycheck to use as spending money and use your monthly pension to “pay the bills. How to amend 2012 tax return ” In that case, change your Form W-4P to zero allowances and claim all that you are entitled to on your Form W-4. How to amend 2012 tax return There are a couple of ways you can get a better idea of how much tax will be withheld when claiming a certain number of allowances. How to amend 2012 tax return Use the withholding tables in Publication 15 (Circular E), Employer's Tax Guide. How to amend 2012 tax return Contact your pension provider and your employer's payroll department. How to amend 2012 tax return And remember, this is not a final decision. How to amend 2012 tax return If you do not get the correct amount of withholding with the first Forms W-4 and W-4P you submit, you should refigure your allowances (or divide them differently) using the information and worksheets in this publication, or the resources mentioned above. How to amend 2012 tax return You should go through this same process each time your life situation changes, whether it be for personal or financial reasons. How to amend 2012 tax return You may need more tax withheld, or you may need less. How to amend 2012 tax return Table 1-2. How to amend 2012 tax return Tax Credits for 2014 For more information about the . How to amend 2012 tax return . How to amend 2012 tax return . How to amend 2012 tax return See . How to amend 2012 tax return . How to amend 2012 tax return . How to amend 2012 tax return Adoption credit Form 8839 instructions Child and dependent care expenses, credit for Publication 503, Child and Dependent Care Expenses Child tax credit (including the additional child tax credit) Instructions for Form 1040 or Form 1040A Earned income credit Publication 596, Earned Income Credit Education credits Publication 970, Tax Benefits for Education Elderly or the disabled, credit for the Publication 524, Credit for the Elderly or the Disabled Foreign tax credit (except any credit that applies to wages not subject to U. How to amend 2012 tax return S. How to amend 2012 tax return income tax withholding because they are subject to income tax withholding by a foreign country) Publication 514, Foreign Tax Credit for Individuals General business credit Form 3800, General Business Credit Mortgage interest credit Publication 530, Tax Information for First-Time Homeowners Qualified electric vehicle passive activity credit Form 8834 Prior year minimum tax, credit for (if you paid alternative minimum tax in an earlier year) Form 8801 instructions Retirement savings contributions credit (saver's credit) Publication 590, Individual Retirement Arrangements (IRAs) Tax credit bonds, credit to holders of Form 8912 instructions Completing Form W-4 and Worksheets When reading the following discussion, you may find it helpful to refer to Form W-4. How to amend 2012 tax return Marital Status There is a lower withholding rate for people who qualify to check the “Married” box on line 3 of Form W-4. How to amend 2012 tax return Everyone else must have tax withheld at the higher single rate. How to amend 2012 tax return Single. How to amend 2012 tax return   You must check the “Single” box if any of the following applies. How to amend 2012 tax return You are single. How to amend 2012 tax return If you are divorced, or separated from your spouse under a court decree of separate maintenance, you are considered single. How to amend 2012 tax return You are married, but neither you nor your spouse is a citizen or resident of the United States. How to amend 2012 tax return You are married, either you or your spouse is a nonresident alien, and you have not chosen to have that person treated as a resident alien for tax purposes. How to amend 2012 tax return For more information, see Nonresident Spouse Treated as a Resident in chapter 1 of Publication 519. How to amend 2012 tax return Married. How to amend 2012 tax return   You qualify to check the “Married” box if any of the following applies. How to amend 2012 tax return You are married and neither you nor your spouse is a nonresident alien. How to amend 2012 tax return You are considered married for the whole year even if your spouse died during the year. How to amend 2012 tax return You are married and either you or your spouse is a nonresident alien who has chosen to be treated as a resident alien for tax purposes. How to amend 2012 tax return For more information, see Nonresident Spouse Treated as a Resident in chapter 1 of Publication 519. How to amend 2012 tax return You expect to be able to file your return as a qualifying widow or widower. How to amend 2012 tax return You usually can use this filing status if your spouse died within the previous 2 years and you provide more than half the cost of keeping up a home for the entire year that was the main home for you and your child whom you can claim as a dependent. How to amend 2012 tax return However, you must file a new Form W-4 showing your filing status as single by December 1 of the last year you are eligible to file as a qualifying widow or widower. How to amend 2012 tax return For more information on this filing status, see Qualifying Widow(er) With Dependent Child under Filing Status in Publication 501, Exemptions, Standard Deduction, and Filing Information. How to amend 2012 tax return Married, but withhold at higher single rate. How to amend 2012 tax return   Some married people find that they do not have enough tax withheld at the married rate. How to amend 2012 tax return This can happen, for example, when both spouses work. How to amend 2012 tax return To avoid this, you can check the “Married, but withhold at higher Single rate” box (even if you qualify for the married rate). How to amend 2012 tax return Also, you may find that more tax is withheld if you fill out the Two-Earners/Multiple Jobs Worksheet, explained later. How to amend 2012 tax return Withholding Allowances The more allowances you claim on Form W-4, the less income tax your employer will withhold. How to amend 2012 tax return You will have the most tax withheld if you claim “0” allowances. How to amend 2012 tax return The number of allowances you can claim depends on the following factors. How to amend 2012 tax return How many exemptions you can take on your tax return. How to amend 2012 tax return Whether you have income from more than one job. How to amend 2012 tax return What deductions, adjustments to income, and credits you expect to have for the year. How to amend 2012 tax return Whether you will file as head of household. How to amend 2012 tax return If you are married (filing jointly), it also depends on whether your spouse also works and claims any allowances on his or her own Form W-4. How to amend 2012 tax return Or, if married filing separately, whether or not your spouse also works. How to amend 2012 tax return Form W-4 worksheets. How to amend 2012 tax return    Form W-4 has worksheets to help you figure how many withholding allowances you can claim. How to amend 2012 tax return The worksheets are for your own records. How to amend 2012 tax return Do not give them to your employer. How to amend 2012 tax return   Complete only one set of Form W-4 worksheets, no matter how many jobs you have. How to amend 2012 tax return If you are married and will file a joint return, complete only one set of worksheets for you and your spouse, even if you both earn wages and each must give Form W-4 to your employers. How to amend 2012 tax return Complete separate sets of worksheets only if you and your spouse will file separate returns. How to amend 2012 tax return   If you are not exempt from withholding (see Exemption From Withholding , later), complete the Personal Allowances Worksheet on page 1 of the form. How to amend 2012 tax return Also, use the worksheets on page 2 of the form to adjust the number of your withholding allowances for itemized deductions and adjustments to income, and for two-earner or multiple-job situations. How to amend 2012 tax return If you want to adjust the number of your withholding allowances for certain tax credits, use the Deductions and Adjustments Worksheet on page 2 of Form W-4, even if you do not have any deductions or adjustments. How to amend 2012 tax return   Complete all worksheets that apply to your situation. How to amend 2012 tax return The worksheets will help you figure the maximum number of withholding allowances you are entitled to claim so that the amount of income tax withheld from your wages will match, as closely as possible, the amount of income tax you will owe at the end of the year. How to amend 2012 tax return Multiple jobs. How to amend 2012 tax return   If you have income from more than one job at the same time, complete only one set of Form W-4 worksheets. How to amend 2012 tax return Then split your allowances between the Forms W-4 for each job. How to amend 2012 tax return You cannot claim the same allowances with more than one employer at the same time. How to amend 2012 tax return You can claim all your allowances with one employer and none with the other(s), or divide them any other way. How to amend 2012 tax return Married individuals. How to amend 2012 tax return   If both you and your spouse are employed and expect to file a joint return, figure your withholding allowances using your combined income, adjustments, deductions, exemptions, and credits. How to amend 2012 tax return Use only one set of worksheets. How to amend 2012 tax return You can divide your total allowances any way, but you cannot claim an allowance that your spouse also claims. How to amend 2012 tax return   If you and your spouse expect to file separate returns, figure your allowances using separate worksheets based on your own individual income, adjustments, deductions, exemptions, and credits. How to amend 2012 tax return Alternative method of figuring withholding allowances. How to amend 2012 tax return   You do not have to use the Form W-4 worksheets if you use a more accurate method of figuring the number of withholding allowances. How to amend 2012 tax return   The method you use must be based on withholding schedules, the tax rate schedules, and the 2014 Estimated Tax Worksheet in chapter 2. How to amend 2012 tax return It must take into account only the items of income, adjustments to income, deductions, and tax credits that are taken into account on Form W-4. How to amend 2012 tax return   You can use the number of withholding allowances determined under an alternative method rather than the number determined using the Form W-4 worksheets. How to amend 2012 tax return You still must give your employer a Form W-4 claiming your withholding allowances. How to amend 2012 tax return Employees who are not citizens or residents. How to amend 2012 tax return   If you are neither a citizen nor a resident of the United States, you usually can claim only one withholding allowance. How to amend 2012 tax return However, this rule does not apply if you are a resident of Canada or Mexico, or if you are a U. How to amend 2012 tax return S. How to amend 2012 tax return national. How to amend 2012 tax return It also does not apply if your spouse is a U. How to amend 2012 tax return S. How to amend 2012 tax return citizen or resident and you have chosen to be treated as a resident of the United States for tax purposes. How to amend 2012 tax return Special rules apply to residents of South Korea and India. How to amend 2012 tax return For more information, see Withholding From Compensation in chapter 8 of Publication 519. How to amend 2012 tax return Personal Allowances Worksheet Use the Personal Allowances Worksheet on page 1 of Form W-4 to figure your withholding allowances based on all of the following that apply. How to amend 2012 tax return Exemptions. How to amend 2012 tax return Only one job. How to amend 2012 tax return Head of household filing status. How to amend 2012 tax return Child and dependent care credit. How to amend 2012 tax return Child tax credit. How to amend 2012 tax return Exemptions (worksheet lines A, C, and D). How to amend 2012 tax return   You can claim one withholding allowance for each exemption you expect to claim on your tax return. How to amend 2012 tax return Self. How to amend 2012 tax return   You can claim an allowance for your exemption on line A unless another person can claim an exemption for you on his or her tax return. How to amend 2012 tax return If another person is entitled to claim an exemption for you, you cannot claim an allowance for your exemption even if the other person will not claim your exemption. How to amend 2012 tax return Spouse. How to amend 2012 tax return   You can claim an allowance for your spouse's exemption on line C unless your spouse is claiming his or her own exemption or another person can claim an exemption for your spouse. How to amend 2012 tax return Do not claim this allowance if you and your spouse expect to file separate returns. How to amend 2012 tax return Dependents. How to amend 2012 tax return   You can claim one allowance on line D for each exemption you will claim for a dependent on your tax return. How to amend 2012 tax return Only one job (worksheet line B). How to amend 2012 tax return    You can claim an additional withholding allowance if any of the following apply for 2014. How to amend 2012 tax return You are single and you have only one job at a time. How to amend 2012 tax return You are married, you have only one job at a time, and your spouse does not work. How to amend 2012 tax return Your wages from a second job or your spouse's wages (or the total of both) are $1,500 or less. How to amend 2012 tax return If you qualify for this allowance, enter “1” on line B of the worksheet. How to amend 2012 tax return Head of household filing status (worksheet line E). How to amend 2012 tax return   Generally, you can file as head of household if you are unmarried and pay more than half the cost of keeping up a home that: Was the main home for all of 2014 of your parent whom you can claim as a dependent, or You lived in for more than half the year with your qualifying child or any other person you can claim as a dependent. How to amend 2012 tax return For more information, see Publication 501. How to amend 2012 tax return   If you expect to file as head of household on your 2014 tax return, enter “1” on line E of the worksheet. How to amend 2012 tax return Reduction of personal allowances. How to amend 2012 tax return   For 2014, your deduction for personal exemptions on your tax return is reduced if your adjusted gross income (AGI) is more than the AGI shown next for your filing status. How to amend 2012 tax return Personal Allowance Phaseout Threshold Single $254,200 Married filing jointly or qualifying widow(er) $305,050 Married filing separately $152,525 Head of household $279,650   If you expect your AGI to be more than the amount listed, use Worksheet 1-1 to figure your reduced number of personal allowances on lines A, C, and D of the Personal Allowances Worksheet. How to amend 2012 tax return Worksheet 1-1. How to amend 2012 tax return Personal Allowances Worksheet (Form W-4) Reduction of Personal Allowances if AGI Above Phaseout Threshold 1. How to amend 2012 tax return Enter the total amount of allowances on lines A, C, and D of the Personal Allowance Worksheet without regard to the phaseout rule 1. How to amend 2012 tax return   2. How to amend 2012 tax return Enter your expected AGI 2. How to amend 2012 tax return       3. How to amend 2012 tax return Enter $254,200 if single $305,050 if married filing jointly or qualifying widow(er) $152,525 if married filing separately $279,650 if head of household 3. How to amend 2012 tax return       4. How to amend 2012 tax return Subtract line 3 from line 2 4. How to amend 2012 tax return       5. How to amend 2012 tax return Divide line 4 by $125,000 ($62,500 if married filing separately). How to amend 2012 tax return Enter the result as a decimal 5. How to amend 2012 tax return   6. How to amend 2012 tax return Multiply line 1 by line 5. How to amend 2012 tax return If the result is not a whole number, increase it to the next higher whole number 6. How to amend 2012 tax return   7. How to amend 2012 tax return Subtract line 6 from line 1. How to amend 2012 tax return The total of the numbers you enter on A, C, and D of the Personal Allowances Worksheet can not be more than this amount 7. How to amend 2012 tax return     Child and dependent care credit (worksheet line F). How to amend 2012 tax return   Enter “1” on line F if you expect to claim a credit for at least $2,000 of qualifying child or dependent care expenses on your 2014 return. How to amend 2012 tax return Generally, qualifying expenses are those you pay for the care of your dependent who is your qualifying child under age 13 or for your spouse or dependent who is not able to care for himself or herself so that you can work or look for work. How to amend 2012 tax return For more information, see Publication 503, Child and Dependent Care Expenses. How to amend 2012 tax return   Instead of using line F, you can choose to take the credit into account on line 5 of the Deductions and Adjustments Worksheet, as explained under Tax credits , later. How to amend 2012 tax return Child tax credit (worksheet line G). How to amend 2012 tax return   If your total income will be less than $65,000 ($95,000 if married), enter “2” on line G for each eligible child. How to amend 2012 tax return Subtract “1” from that amount if you have three to six eligible children. How to amend 2012 tax return Subtract “2” from that amount if you have seven or more eligible children. How to amend 2012 tax return   If your total income will be between $65,000 and $84,000 ($95,000 and $119,000 if married), enter “1” on line G for each eligible child. How to amend 2012 tax return   An eligible child is any child: Who is your son, daughter, stepchild, foster child, brother, sister, stepbrother, stepsister, half brother, half sister, or a descendant of any of them (for example, your grandchild, niece, or nephew), Who will be under age 17 at the end of 2014, Who is younger than you (or your spouse if filing jointly) or permanently and totally disabled, Who will not provide over half of his or her own support for 2014, Who will not file a joint return, unless the return is filed only as a claim for refund, Who will live with you for more than half of 2014, Who is a U. How to amend 2012 tax return S. How to amend 2012 tax return citizen, U. How to amend 2012 tax return S. How to amend 2012 tax return national, or U. How to amend 2012 tax return S. How to amend 2012 tax return resident alien, and Who will be claimed as a dependent on your return. How to amend 2012 tax return If you are a U. How to amend 2012 tax return S. How to amend 2012 tax return citizen or U. How to amend 2012 tax return S. How to amend 2012 tax return national and your adopted child lived with you all year as a member of your household, that child meets the citizenship test. How to amend 2012 tax return   Also, if any other person can claim the child as an eligible child, see Qualifying child of more than one person in the 2013 instructions for Form 1040 or 1040A, line 6c. How to amend 2012 tax return   For more information about the child tax credit, see the instructions for Form 1040 or Form 1040A. How to amend 2012 tax return   Instead of using line G, you can choose to take the credit into account on line 5 of the Deductions and Adjustments Worksheet, as explained under Tax credits , later. How to amend 2012 tax return Total personal allowances (worksheet line H). How to amend 2012 tax return    Add lines A through G and enter the total on line H. How to amend 2012 tax return If you do not use either of the worksheets on the back of Form W-4, enter the number from line H on line 5 of Form W-4. How to amend 2012 tax return Deductions and Adjustments Worksheet Use the Deductions and Adjustments Worksheet on page 2 of Form W-4 if you plan to itemize your deductions, claim certain credits, or claim adjustments to the income on your 2014 tax return and you want to reduce your withholding. How to amend 2012 tax return Also, complete this worksheet when you have changes to those items to see if you need to change your withholding. How to amend 2012 tax return Use the amount of each item you reasonably can expect to show on your return. How to amend 2012 tax return However, do not use more than: The amount shown for that item on your 2013 return (or your 2012 return if you have not yet filed your 2013 return), plus Any additional amount related to a transaction or occurrence (such as payments already made, the signing of an agreement, or the sale of property) that you can prove has happened or will happen during 2013 or 2014. How to amend 2012 tax return Do not include any amount shown on your last tax return that has been disallowed by the IRS. How to amend 2012 tax return Example. How to amend 2012 tax return On June 30, 2013, you bought your first home. How to amend 2012 tax return On your 2013 tax return, you claimed itemized deductions of $6,600, the total mortgage interest and real estate tax you paid during the 6 months you owned your home. How to amend 2012 tax return Based on your mortgage payment schedule and your real estate tax assessment, you reasonably can expect to claim deductions of $13,200 for those items on your 2014 return. How to amend 2012 tax return You can use $13,200 to figure the number of your withholding allowances for itemized deductions. How to amend 2012 tax return Not itemizing deductions. How to amend 2012 tax return   If you expect to claim the standard deduction on your tax return, skip lines 1 and 2, and enter “0” on line 3 of the worksheet. How to amend 2012 tax return Itemized deductions (worksheet line 1). How to amend 2012 tax return   Enter your estimated total itemized deductions on line 1 of the worksheet. How to amend 2012 tax return   Listed below are some of the deductions you can take into account when figuring additional withholding allowances for 2014. How to amend 2012 tax return You normally claim these deductions on Schedule A of Form 1040. How to amend 2012 tax return Medical and dental expenses that are more than 10% (7. How to amend 2012 tax return 5% if either you or your spouse was born before January 2, 1950) of your 2014 AGI (defined under AGI , later). How to amend 2012 tax return State and local income or property taxes. How to amend 2012 tax return Deductible home mortgage interest. How to amend 2012 tax return Investment interest up to net investment income. How to amend 2012 tax return Charitable contributions. How to amend 2012 tax return Casualty and theft losses that are more than $100 and 10% of your AGI. How to amend 2012 tax return Fully deductible miscellaneous itemized deductions, including: Impairment-related work expenses of persons with disabilities, Federal estate tax on income in respect of a decedent, Repayment of more than $3,000 of income held under a claim of right that you included in income in an earlier year because at the time you thought you had an unrestricted right to it, Unrecovered investments in an annuity contract under which payments have ceased because of the annuitant's death, Gambling losses up to the amount of gambling winnings reported on your return, and Casualty and theft losses from  income-producing property. How to amend 2012 tax return Other miscellaneous itemized deductions that are more than 2% of your AGI, including: Unreimbursed employee business expenses, such as education expenses, work clothes and uniforms, union dues and fees, and the cost of work-related small tools and supplies, Safe deposit box rental, Tax counsel and assistance, and Certain fees paid to an IRA trustee or custodian. How to amend 2012 tax return AGI. How to amend 2012 tax return   For the purpose of estimating your itemized deductions, your AGI is your estimated total income for 2014 minus any estimated adjustments to income (discussed later) that you include on line 4 of the Deductions and Adjustments Worksheet. How to amend 2012 tax return Phaseout of itemized deductions. How to amend 2012 tax return   For 2014, your total itemized deductions may be phased out (reduced) if your AGI is more than the following thresholds. How to amend 2012 tax return    Itemized Deduction Phaseout Threshold Single $254,200 Married filing jointly or qualifying widow(er) $305,050 Married filing separately $152,525 Head of household $279,650   If you expect your AGI to be more than the amount listed, use Worksheet 1–2 to figure your reduction in itemized deductions. How to amend 2012 tax return Worksheet 1-2. How to amend 2012 tax return Deductions and Adjustments Worksheet (Form W-4)—Line 1 Phaseout of Itemized Deductions 1. How to amend 2012 tax return Enter the estimated total of your itemized deductions 1. How to amend 2012 tax return   2. How to amend 2012 tax return Enter the amount included in line 1 for medical and dental expenses, investment interest, casualty or theft losses, and gambling losses 2. How to amend 2012 tax return   3. How to amend 2012 tax return Is the amount on line 2 less than the amount on line 1? ❑ No. How to amend 2012 tax return Stop here. How to amend 2012 tax return Your deduction is not limited. How to amend 2012 tax return Enter the amount from line 1 above on line 1 of the Deductions and Adjustments Worksheet. How to amend 2012 tax return  ❑ Yes. How to amend 2012 tax return Subtract line 2 from line 1. How to amend 2012 tax return 3. How to amend 2012 tax return       4. How to amend 2012 tax return Multiply line 3 by 80% (. How to amend 2012 tax return 80) 4. How to amend 2012 tax return       5. How to amend 2012 tax return Enter your expected AGI 5. How to amend 2012 tax return       6. How to amend 2012 tax return Enter $305,050 If married filing jointly or qualifying widow(er), $279,650 if head of household, $254,200 if single, or $152,525 if married filing separately 6. How to amend 2012 tax return   7. How to amend 2012 tax return Is the amount on line 6 less than the amount on line 5? ❑ No. How to amend 2012 tax return Stop here. How to amend 2012 tax return Your deduction is not limited. How to amend 2012 tax return Enter the amount from line 1 above on line 1 of the Deductions and Adjustments Worksheet. How to amend 2012 tax return  ❑ Yes. How to amend 2012 tax return Subtract line 6 from line 5. How to amend 2012 tax return 7. How to amend 2012 tax return       8. How to amend 2012 tax return Multiply line 7 by 3% (. How to amend 2012 tax return 03) 8. How to amend 2012 tax return       9. How to amend 2012 tax return Enter the smaller of line 4 or line 8 9. How to amend 2012 tax return     10. How to amend 2012 tax return Subtract line 9 from line 1. How to amend 2012 tax return Enter the result here and on line 1 of the Deductions and Adjustments Worksheet 10. How to amend 2012 tax return     Adjustments to income (worksheet line 4). How to amend 2012 tax return   Enter your estimated total adjustments to income on line 4 of the Deductions and Adjustments Worksheet. How to amend 2012 tax return   You can take the following adjustments to income into account when figuring additional withholding allowances for 2014. How to amend 2012 tax return These adjustments appear on page 1 of your Form 1040 or 1040A. How to amend 2012 tax return Net losses from Schedules C, D, E, and F of Form 1040 and from Part II of Form 4797, line 18b. How to amend 2012 tax return Net operating loss carryovers. How to amend 2012 tax return Certain business expenses of reservists, performing artists, and fee-based government officials. How to amend 2012 tax return Health savings account or medical savings account deduction. How to amend 2012 tax return Certain moving expenses. How to amend 2012 tax return Deduction for self-employment tax. How to amend 2012 tax return Deduction for contributions to self-employed SEP, and qualified SIMPLE plans. How to amend 2012 tax return Self-employed health insurance deduction. How to amend 2012 tax return Penalty on early withdrawal of savings. How to amend 2012 tax return Alimony paid. How to amend 2012 tax return IRA deduction. How to amend 2012 tax return Student loan interest deduction. How to amend 2012 tax return Jury duty pay given to your employer. How to amend 2012 tax return Reforestation amortization and expenses. How to amend 2012 tax return Deductible expenses related to income reported on line 21 from the rental of personal property engaged in for profit. How to amend 2012 tax return Repayment of certain supplemental unemployment benefits. How to amend 2012 tax return Contributions to IRC 501(c)(18)(D) pension plans. How to amend 2012 tax return Contributions by certain chaplains to IRC 403(b) plans. How to amend 2012 tax return Attorney fees and court costs for certain unlawful discrimination claims. How to amend 2012 tax return Attorney fees and court costs for certain whistleblower awards. How to amend 2012 tax return Estimated amount of decrease in tax attributable to income averaging using Schedule J (Form 1040). How to amend 2012 tax return Tax credits (worksheet line 5). How to amend 2012 tax return   Although you can take most tax credits into account when figuring withholding allowances, the Personal Allowances Worksheet uses only the child and dependent care credit (line F) and the child tax credit (line G). How to amend 2012 tax return But you can take these credits and others into account by adding an extra amount on line 5 of the Deductions and Adjustments Worksheet. How to amend 2012 tax return   If you take the child and dependent care credit into account on line 5, do not use line F. How to amend 2012 tax return If you take the child tax credit into account on line 5, do not use line G. How to amend 2012 tax return   In addition to the child and dependent care credit and the child tax credit, you can generally take into account the following credits. How to amend 2012 tax return See the individual tax form instructions for more details. How to amend 2012 tax return Foreign tax credit, except any credit that applies to wages not subject to U. How to amend 2012 tax return S. How to amend 2012 tax return income tax withholding because they are subject to income tax withholding by a foreign country. How to amend 2012 tax return See Publication 514, Foreign Tax Credit for Individuals. How to amend 2012 tax return Credit for the elderly or the disabled. How to amend 2012 tax return See Publication 524, Credit for the Elderly or the Disabled. How to amend 2012 tax return Education credits. How to amend 2012 tax return See Publication 970, Tax Benefits for Education. How to amend 2012 tax return Retirement savings contributions credit (saver's credit). How to amend 2012 tax return See Publication 590. How to amend 2012 tax return Mortgage interest credit. How to amend 2012 tax return See Publication 530, Tax Information for Homeowners. How to amend 2012 tax return Adoption credit. How to amend 2012 tax return See the Instructions for Form 8839. How to amend 2012 tax return Credit for nonrefundable portion of prior year minimum tax if you paid alternative minimum tax in an earlier year. How to amend 2012 tax return See the Instructions for Form 8801. How to amend 2012 tax return General business credit. How to amend 2012 tax return See the Instructions for Form 3800. How to amend 2012 tax return Earned income credit. How to amend 2012 tax return See Publication 596. How to amend 2012 tax return Figuring line 5 entry. How to amend 2012 tax return   To figure the amount to add on line 5 for tax credits, multiply your estimated total credits by the appropriate number from Table 1-3 . How to amend 2012 tax return Example. How to amend 2012 tax return You are married and expect to file a joint return for 2014. How to amend 2012 tax return Your combined estimated wages are $68,000. How to amend 2012 tax return Your estimated tax credits include a child and dependent care credit of $960 and a mortgage interest credit of $1,700 (total credits = $2,660). How to amend 2012 tax return In Table 1-3, the number corresponding to your combined estimated wages ($42,001 – $98,000) is 6. How to amend 2012 tax return 7. How to amend 2012 tax return Multiply your total estimated tax credits of $2,660 by 6. How to amend 2012 tax return 7. How to amend 2012 tax return Add the result, $17,822, to the amount you otherwise would show on line 5 of the Deductions and Adjustments Worksheet and enter the total on line 5. How to amend 2012 tax return Because you choose to account for your child and dependent care credit this way, do not make an entry on line F of the Personal Allowances Worksheet. How to amend 2012 tax return Nonwage income (worksheet line 6). How to amend 2012 tax return   Enter on line 6 your estimated total nonwage income (other than tax-exempt income). How to amend 2012 tax return Nonwage income includes interest, dividends, net rental income, unemployment compensation, alimony, gambling winnings, prizes and awards, hobby income, capital gains, royalties, and partnership income. How to amend 2012 tax return   If line 6 is more than line 5, you may not have enough income tax withheld from your wages. How to amend 2012 tax return See Getting the Right Amount of Tax Withheld , later. How to amend 2012 tax return Net deductions and adjustments (worksheet line 8). How to amend 2012 tax return    If line 7 is less than $3,950, enter “0” on line 8. How to amend 2012 tax return If line 7 is $3,950 or more, divide it by $3,950, drop any fraction, and enter the result on line 8. How to amend 2012 tax return Example. How to amend 2012 tax return If line 7 is $5,200, $5,200 ÷ $3,950 = 1. How to amend 2012 tax return 32. How to amend 2012 tax return Drop the fraction (. How to amend 2012 tax return 32) and enter “1” on line 8. How to amend 2012 tax return Two-Earners/Multiple Jobs Worksheet Complete the Two-Earners/Multiple Jobs Worksheet on page 2 of Form W-4 if you have more than one job or are married and you and your spouse both work and the combined earnings from all jobs are more than $50,000 ($20,000 if married). How to amend 2012 tax return Reducing your allowances (worksheet lines 1-3). How to amend 2012 tax return   On line 1 of the worksheet, enter the number from line H of the Personal Allowances Worksheet (or line 10 of the Deductions and Adjustments Worksheet, if used). How to amend 2012 tax return Using Table 1 in the Two-Earners/Multiple Jobs Worksheet, find the number listed beside the amount of your estimated wages for the year from your lowest paying job (or if lower and you are filing jointly, your spouse's job). How to amend 2012 tax return Enter that number on line 2. How to amend 2012 tax return However, if you are married filing jointly and estimated wages from the highest paying job are $65,000 or less, do not enter more than “3. How to amend 2012 tax return ”    Table 1-3. How to amend 2012 tax return Deductions and Adjustments Worksheet (Form W-4)—Line 5 a. How to amend 2012 tax return  Married Filing Jointly or Qualifying Widow(er) If combined income from all sources is:   Multiply credits by: $0 – 42,000 10. How to amend 2012 tax return 0 $42,001 – 98,000 6. How to amend 2012 tax return 7 $98,001 – 180,000 4. How to amend 2012 tax return 0 $180,001 – 270,000 3. How to amend 2012 tax return 6 $270,001 – 440,000 3. How to amend 2012 tax return 0 $440,001 – 490,000. How to amend 2012 tax return . How to amend 2012 tax return . How to amend 2012 tax return . How to amend 2012 tax return 2. How to amend 2012 tax return 9 $490,001 and over 2. How to amend 2012 tax return 5 b. How to amend 2012 tax return  Single If combined income from all sources is:   Multiply credits by: $0 – 19,000 10. How to amend 2012 tax return 0 $19,001 – 47,000 6. How to amend 2012 tax return 7 $47,001 – 104,000 4. How to amend 2012 tax return 0 $104,001 – 205,000 3. How to amend 2012 tax return 6 $205,001 – 430,000 3. How to amend 2012 tax return 0 $430,001 and over 2. How to amend 2012 tax return 5 c. How to amend 2012 tax return  Head of Household If combined income from all sources is:   Multiply credits by: $0 – 30,000 10. How to amend 2012 tax return 0 $30,001 – 66,000 6. How to amend 2012 tax return 7 $66,001 – 150,000 4. How to amend 2012 tax return 0 $150,001 – 235,000 3. How to amend 2012 tax return 6 $235,001 – 430,000 3. How to amend 2012 tax return 0 $430,001 – 460,000 2. How to amend 2012 tax return 9 $460,001 and over 2. How to amend 2012 tax return 5 d. How to amend 2012 tax return  Married Filing Separately   If combined income from all sources is:   Multiply credits by: $0 – 21,000 10. How to amend 2012 tax return 0 $21,001 – 49,000 6. How to amend 2012 tax return 7 $49,001 – 90,000 4. How to amend 2012 tax return 0 $90,001 – 135,000 3. How to amend 2012 tax return 6 $135,001 – 220,000 3. How to amend 2012 tax return 0 $220,001 – 245,000 2. How to amend 2012 tax return 9 $245,001 and over 2. How to amend 2012 tax return 5   Subtract line 2 from line 1 and enter the result (but not less than zero) on line 3 and on Form W-4, line 5. How to amend 2012 tax return If line 1 is more than or equal to line 2, do not use the rest of the worksheet. How to amend 2012 tax return   If line 1 is less than line 2, enter “0” on Form W-4, line 5. How to amend 2012 tax return Then complete lines 4 through 9 of the worksheet to figure the additional withholding needed to avoid underwithholding. How to amend 2012 tax return Other amounts owed. How to amend 2012 tax return   If you expect to owe amounts other than income tax, such as self-employment tax, include them on line 8. How to amend 2012 tax return The total is the additional withholding needed for the year. How to amend 2012 tax return Getting the Right Amount of Tax Withheld In most situations, the tax withheld from your pay will be close to the tax you figure on your return if you follow these two rules. How to amend 2012 tax return You accurately complete all the Form W-4 worksheets that apply to you. How to amend 2012 tax return You give your employer a new Form W-4 when changes occur. How to amend 2012 tax return But because the worksheets and withholding methods do not account for all possible situations, you may not be getting the right amount withheld. How to amend 2012 tax return This is most likely to happen in the following situations. How to amend 2012 tax return You are married and both you and your spouse work. How to amend 2012 tax return You have more than one job at a time. How to amend 2012 tax return You have nonwage income, such as interest, dividends, alimony, unemployment compensation, or self-employment income. How to amend 2012 tax return You will owe additional amounts with your return, such as self-employment tax. How to amend 2012 tax return Your withholding is based on obsolete Form W-4 information for a substantial part of the year. How to amend 2012 tax return Your earnings are more than $130,000 if you are single or $180,000 if you are married. How to amend 2012 tax return You work only part of the year. How to amend 2012 tax return You change the number of your withholding allowances during the year. How to amend 2012 tax return You are subject to Additional Medicare Tax or Net Investment Income Tax. How to amend 2012 tax return If you anticipate liability for Additional Medicare Tax or Net Investment Income Tax, you may request that your employer withhold an additional amount of income tax withholding on Form W-4. How to amend 2012 tax return Part-Year Method If you work only part of the year and your employer agrees to use the part-year withholding method, less tax will be withheld from each wage payment than would be withheld if you worked all year. How to amend 2012 tax return To be eligible for the part-year method, you must meet both of the following requirements. How to amend 2012 tax return You must use the calendar year (the 12 months from January 1 through December 31) as your tax year. How to amend 2012 tax return You cannot use a fiscal year. How to amend 2012 tax return You must not expect to be employed for more than 245 days during the year. How to amend 2012 tax return To figure this limit, count all calendar days that you are employed (including weekends, vacations, and sick days) beginning with the first day you are on the job for pay and ending with your last day of work. How to amend 2012 tax return If you are temporarily laid off for 30 days or less, count those days too. How to amend 2012 tax return If you are laid off for more than 30 days, do not count those days. How to amend 2012 tax return You will not meet this requirement if you begin working before May 1 and expect to work for the rest of the year. How to amend 2012 tax return How to apply for the part-year method. How to amend 2012 tax return   You must ask your employer in writing to use this method. How to amend 2012 tax return The request must state all three of the following. How to amend 2012 tax return The date of your last day of work for any prior employer during the current calendar year. How to amend 2012 tax return That you do not expect to be employed more than 245 days during the current calendar year. How to amend 2012 tax return That you use the calendar year as your tax year. How to amend 2012 tax return Cumulative Wage Method If you change the number of your withholding allowances during the year, too much or too little tax may have been withheld for the period before you made the change. How to amend 2012 tax return You may be able to compensate for this if your employer agrees to use the cumulative wage withholding method for the rest of the year. How to amend 2012 tax return You must ask your employer in writing to use this method. How to amend 2012 tax return To be eligible, you must have been paid for the same kind of payroll period (weekly, biweekly, etc. How to amend 2012 tax return ) since the beginning of the year. How to amend 2012 tax return Aids for Figuring Your Withholding IRS Withholding Calculator. How to amend 2012 tax return   If you had too much or too little income tax withheld from your pay, the IRS provides a withholding calculator on its website. How to amend 2012 tax return Go to www. How to amend 2012 tax return irs. How to amend 2012 tax return gov/Individuals/IRS-Withholding-Calculator. How to amend 2012 tax return It can help you determine the correct amount to be withheld any time during the year. How to amend 2012 tax return Rules Your Employer Must Follow It may be helpful for you to know some of the withholding rules your employer must follow. How to amend 2012 tax return These rules can affect how to fill out your Form W-4 and how to handle problems that may arise. How to amend 2012 tax return New Form W-4. How to amend 2012 tax return   When you start a new job, your employer should give you a Form W-4 to fill out. How to amend 2012 tax return Beginning with your first payday, your employer will use the information you give on the form to figure your withholding. How to amend 2012 tax return   If you later fill out a new Form W-4, your employer can put it into effect as soon as possible. How to amend 2012 tax return The deadline for putting it into effect is the start of the first payroll period ending 30 or more days after you turn it in. How to amend 2012 tax return No Form W-4. How to amend 2012 tax return   If you do not give your employer a completed Form W-4, your employer must withhold at the highest rate, as if you were single and claimed no withholding allowances. How to amend 2012 tax return Repaying withheld tax. How to amend 2012 tax return   If you find you are having too much tax withheld because you did not claim all the withholding allowances you are entitled to, you should give your employer a new Form W-4. How to amend 2012 tax return Your employer cannot repay any of the tax previously withheld. How to amend 2012 tax return Instead, claim the full amount withheld when you file your tax return. How to amend 2012 tax return   However, if your employer has withheld more than the correct amount of tax for the Form W-4 you have in effect, you do not have to fill out a new Form W-4 to have your withholding lowered to the correct amount. How to amend 2012 tax return Your employer can repay the amount that was withheld incorrectly. How to amend 2012 tax return If you are not repaid, your Form W-2 will reflect the full amount actually withheld, which you would claim when you file your tax return. How to amend 2012 tax return IRS review of your withholding. How to amend 2012 tax return   Whether you are entitled to claim a certain number of allowances or a complete exemption from withholding is subject to review by the IRS. How to amend 2012 tax return Your employer may be required to send a copy of the Form W-4 to the IRS. How to amend 2012 tax return There is a penalty for supplying false information on Form W-4. How to amend 2012 tax return See Penalties , later. How to amend 2012 tax return   If the IRS determines that you cannot claim more than a specified number of withholding allowances or claim a complete exemption from withholding, the IRS will issue a notice of the maximum number of withholding allowances permitted (commonly referred to as a “lock-in letter”) to both you and your employer. How to amend 2012 tax return   The IRS will provide a period of time during which you can dispute the determination before your employer adjusts your withholding. How to amend 2012 tax return If you believe that you are entitled to claim complete exemption from withholding or claim more withholding allowances than the maximum number specified by the IRS in the lock-in letter, you must submit a new Form W-4 and a written statement to support your claims to the IRS. How to amend 2012 tax return Contact information (a toll-free number and an IRS office address) will be provided in the lock-in letter. How to amend 2012 tax return At the end of this period, if you have not responded or if your response is not adequate, your employer will be required to withhold based on the original lock-in letter. How to amend 2012 tax return   After the lock-in letter takes effect, your employer must withhold tax on the basis of the withholding rate (marital status) and maximum number of withholding allowances specified in that letter. How to amend 2012 tax return   If you later believe that you are entitled to claim exemption from withholding or more allowances than the IRS determined, you can complete a new Form W-4 and a written statement to support the claims made on the Form W-4 and send them directly to the IRS address shown on the lock-in letter. How to amend 2012 tax return Your employer must continue to figure your withholding on the basis of the number of allowances previously determined by the IRS until the IRS advises your employer otherwise. How to amend 2012 tax return   At any time, either before or after the lock-in letter becomes effective, you may give your employer a new Form W-4 that does not claim complete exemption from withholding and results in more income tax withheld than specified in the lock-in letter. How to amend 2012 tax return Your employer must then withhold tax based on this new Form W-4. How to amend 2012 tax return   Additional information is available at IRS. How to amend 2012 tax return gov. How to amend 2012 tax return Enter “withholding compliance questions” in the search box. How to amend 2012 tax return Exemption From Withholding If you claim exemption from withholding, your employer will not withhold federal income tax from your wages. How to amend 2012 tax return The exemption applies only to income tax, not to social security or Medicare tax. How to amend 2012 tax return You can claim exemption from withholding for 2014 only if both of the following situations apply. How to amend 2012 tax return For 2013 you had a right to a refund of all federal income tax withheld because you had no tax liability. How to amend 2012 tax return For 2014 you expect a refund of all federal income tax withheld because you expect to have no tax liability. How to amend 2012 tax return Use Figure 1-A to help you decide whether you can claim exemption from withholding. How to amend 2012 tax return Do not use Figure 1-A if you: Are 65 or older, Are blind, Will itemize deductions on your 2014 return, Will claim an exemption for a dependent on your 2014 return, or Will claim any tax credits on your 2014 return. How to amend 2012 tax return These situations are discussed later. How to amend 2012 tax return Students. How to amend 2012 tax return   If you are a student, you are not automatically exempt. How to amend 2012 tax return If you work only part time or during the summer, you may qualify for exemption from withholding. How to amend 2012 tax return Example 1. How to amend 2012 tax return You are a high school student and expect to earn $2,500 from a summer job. How to amend 2012 tax return You do not expect to have any other income during the year, and your parents will be able to claim an exemption for you on their tax return. How to amend 2012 tax return You worked last summer and had $375 federal income tax withheld from your pay. How to amend 2012 tax return The entire $375 was refunded when you filed your 2013 return. How to amend 2012 tax return Using Figure 1-A, you find that you can claim exemption from withholding. How to amend 2012 tax return Please click here for the text description of the image. How to amend 2012 tax return Figure 1-A: Exemption From Withholding on Form W-4 Example 2. How to amend 2012 tax return The facts are the same as in Example 1, except that you also have a savings account and expect to have $400 interest income during the year. How to amend 2012 tax return Using Figure 1-A, you find that you cannot claim exemption from withholding because your unearned income will be more than $350 and your total income will be more than $1,000. How to amend 2012 tax return    You may have to file a tax return, even if you are exempt from withholding. How to amend 2012 tax return See Publication 501 to see whether you must file a return. How to amend 2012 tax return    Age 65 or older or blind. How to amend 2012 tax return If you are 65 or older or blind, use Worksheet 1-3 or Worksheet 1-4, to help you decide whether you can claim exemption from withholding. How to amend 2012 tax return Do not use either worksheet if you will itemize deductions, claim exemptions for dependents, or claim tax credits on your 2014 return. How to amend 2012 tax return Instead, see Itemizing deductions or claiming exemptions or credits, next. How to amend 2012 tax return Itemizing deductions or claiming exemptions or credits. How to amend 2012 tax return   If you had no tax liability for 2013, and you will: Itemize deductions, Claim an exemption for a dependent, or Claim a tax credit, use the 2014 Estimated Tax Worksheet (also see chapter 2), to figure your 2014 expected tax liability. How to amend 2012 tax return You can claim exemption from withholding only if your total expected tax liability (line 13c of the worksheet) is zero. How to amend 2012 tax return Claiming exemption from withholding. How to amend 2012 tax return   To claim exemption, you must give your employer a Form W-4. How to amend 2012 tax return Do not complete lines 5 and 6. How to amend 2012 tax return Enter “Exempt” on line 7. How to amend 2012 tax return   If you claim exemption, but later your situation changes so that you will have to pay income tax after all, you must file a new Form W-4 within 10 days after the change. How to amend 2012 tax return If you claim exemption in 2014 but you expect to owe income tax for 2015, you must file a new Form W-4 by December 1, 2014. How to amend 2012 tax return   Your claim of exempt status may be reviewed by the IRS. How to amend 2012 tax return See IRS review of your withholding , earlier. How to amend 2012 tax return An exemption is good for only 1 year. How to amend 2012 tax return   You must give your employer a new Form W-4 by February 15 each year to continue your exemption. How to amend 2012 tax return Supplemental Wages Supplemental wages include bonuses, commissions, overtime pay, vacation allowances, certain sick pay, and expense allowances under certain plans. How to amend 2012 tax return The payer can figure withholding on supplemental wages using the same method used for your regular wages. How to amend 2012 tax return However, if these payments are identified separately from regular wages, your employer or other payer of supplemental wages can withhold income tax from these wages at a flat rate. How to amend 2012 tax return Expense allowances. How to amend 2012 tax return   Reimbursements or other expense allowances paid by your employer under a nonaccountable plan are treated as supplemental wages. How to amend 2012 tax return A nonaccountable plan is a reimbursement arrangement that does not require you to account for, or prove, your business expenses to your employer or does not require you to return your employer's payments that are more than your proven expenses. How to amend 2012 tax return   Reimbursements or other expense allowances paid under an accountable plan that are more than your proven expenses are treated as paid under a nonaccountable plan if you do not return the excess payments within a reasonable period of time. How to amend 2012 tax return Accountable plan. How to amend 2012 tax return   To be an accountable plan, your employer's reimbursement or allowance arrangement must include all three of the following rules. How to amend 2012 tax return Your expenses must have a business connection. How to amend 2012 tax return That is, you must have paid or incurred deductible expenses while performing services as an employee of your employer. How to amend 2012 tax return You must adequately account to your employer for these expenses within a reasonable period of time. How to amend 2012 tax return You must return any excess reimbursement or allowance within a reasonable period of time. How to amend 2012 tax return    An excess reimbursement or allowance is any amount you are paid that is more than the business-related expenses that you adequately accounted for to your employer. How to amend 2012 tax return   The definition of reasonable period of time depends on the facts and circumstances of your situation. How to amend 2012 tax return However, regardless of those facts and circumstances, actions that take place within the times specified in the following list will be treated as taking place within a reasonable period of time. How to amend 2012 tax return You receive an advance within 30 days of the time you have an expense. How to amend 2012 tax return You adequately account for your expenses within 60 days after they were paid or incurred. How to amend 2012 tax return You return any excess reimbursement within 120 days after the expense was paid or incurred. How to amend 2012 tax return You are given a periodic statement (at least quarterly) that asks you to either return or adequately account for outstanding advances and you comply within 120 days of the statement. How to amend 2012 tax return Nonaccountable plan. How to amend 2012 tax return   Any plan that does not meet the definition of an accountable plan is considered a nonaccountable plan. How to amend 2012 tax return For more information about accountable and nonaccountable plans, see chapter 6 of Publication 463, Travel, Entertainment, Gift, and Car Expenses. How to amend 2012 tax return Penalties You may have to pay a penalty of $500 if both of the following apply. How to amend 2012 tax return You make statements or claim withholding allowances on your Form W-4 that reduce the amount of tax withheld. How to amend 2012 tax return You have no reasonable basis for those statements or allowances at the time you prepare your Form W-4. How to amend 2012 tax return There is also a criminal penalty for willfully supplying false or fraudulent information on your Form W-4 or for willfully failing to supply information that would increase the amount withheld. How to amend 2012 tax return The penalty upon conviction can be either a fine of up to $1,000 or imprisonment for up to 1 year, or both. How to amend 2012 tax return These penalties will apply if you deliberately and knowingly falsify your Form W-4 in an attempt to reduce or eliminate the proper withholding of taxes. How to amend 2012 tax return A simple error or an honest mistake will not result in one of these penalties. How to amend 2012 tax return For example, a person who has tried to figure the number of withholding allowances correctly, but claims seven when the proper number is six, will not be charged a Form W-4 penalty. How to amend 2012 tax return However, see chapter 4 for information on the penalty for underpaying your tax. How to amend 2012 tax return Tips The tips you receive while working on your job are considered part of your pay. How to amend 2012 tax return You must include your tips on your tax return on the same line as your regular pay. How to amend 2012 tax return However, tax is not withheld directly from tip income, as it is from your regular pay. How to amend 2012 tax return Nevertheless, your employer will take into account the tips you report when figuring how much to withhold from your regular pay. How to amend 2012 tax return Reporting tips to your employer. How to amend 2012 tax return   If you receive tips of $20 or more in a month while working for any one employer, you must report to your employer the total amount of tips you receive on the job during the month. How to amend 2012 tax return The report is due by the 10th day of the following month. How to amend 2012 tax return   If you have more than one job, make a separate report to each employer. How to amend 2012 tax return Report only the tips you received while working for that employer, and only if they total $20 or more for the month. How to amend 2012 tax return How employer figures amount to withhold. How to amend 2012 tax return   The tips you report to your employer are counted as part of your income for the month you report them. How to amend 2012 tax return Your employer can figure your withholding in either of two ways. How to amend 2012 tax return By withholding at the regular rate on the sum of your pay plus your reported tips. How to amend 2012 tax return By withholding at the regular rate on your pay plus a percentage of your reported tips. How to amend 2012 tax return Not enough pay to cover taxes. How to amend 2012 tax return   If your regular pay is not enough for your employer to withhold all the tax (including income tax and social security and Medicare taxes (or the equivalent railroad retirement tax)) due on your pay plus your tips, you can give your employer money to cover the shortage. How to amend 2012 tax return   If you do not give your employer money to cover the shortage, your employer first withholds as much Medicare tax and social security or railroad retirement tax as possible, up to the proper amount, and then withholds income tax up to the full amount of your pay. How to amend 2012 tax return If not enough tax is withheld, you may have to pay estimated tax. How to amend 2012 tax return When you file your return, you also may have to pay any Medicare and social security tax or railroad retirement tax your employer could not withhold. How to amend 2012 tax return Tips not reported to your employer. How to amend 2012 tax return   On your tax return, you must report all the tips you receive during the year, even tips you do not report to your employer (this includes the value of any noncash tips you received, such as tickets, passes, or other items of value). How to amend 2012 tax return Make sure you are having enough tax withheld, or are paying enough estimated tax (see chapter 2), to cover all your tip income. How to amend 2012 tax return Allocated tips. How to amend 2012 tax return   If you work in a large food or beverage establishment, your employer may have to report an allocated amount of tips on your Form W-2. How to amend 2012 tax return   Your employer should not withhold income tax, Medicare tax, and social security or railroad retirement tax on the allocated amount. How to amend 2012 tax return Withholding is based only on your pay plus your reported tips. How to amend 2012 tax return Your employer should refund to you any incorrectly withheld tax. How to amend 2012 tax return More information. How to amend 2012 tax return   For more information on the reporting and withholding rules for tip income and on tip allocation, see Publi