File your Taxes for Free!
  • Get your maximum refund*
  • 100% accurate calculations guaranteed*

TurboTax Federal Free Edition - File Taxes Online

Don't let filing your taxes get you down! We'll help make it as easy as possible. With e-file and direct deposit, there's no faster way to get your refund!

Approved TurboTax Affiliate Site. TurboTax and TurboTax Online, among others, are registered trademarks and/or service marks of Intuit Inc. in the United States and other countries. Other parties' trademarks or service marks are the property of the respective owners.


© 2012 - 2018 All rights reserved.

This is an Approved TurboTax Affiliate site. TurboTax and TurboTax Online, among other are registered trademarks and/or service marks of Intuit, Inc. in the United States and other countries. Other parties' trademarks or service marks are the property of the respective owners.
When discussing "Free e-file", note that state e-file is an additional fee. E-file fees do not apply to New York state returns. Prices are subject to change without notice. E-file and get your refund faster
*If you pay an IRS or state penalty or interest because of a TurboTax calculations error, we'll pay you the penalty and interest.
*Maximum Refund Guarantee - or Your Money Back: If you get a larger refund or smaller tax due from another tax preparation method, we'll refund the applicable TurboTax federal and/or state purchase price paid. TurboTax Federal Free Edition customers are entitled to payment of $14.99 and a refund of your state purchase price paid. Claims must be submitted within sixty (60) days of your TurboTax filing date and no later than 6/15/14. E-file, Audit Defense, Professional Review, Refund Transfer and technical support fees are excluded. This guarantee cannot be combined with the TurboTax Satisfaction (Easy) Guarantee. *We're so confident your return will be done right, we guarantee it. Accurate calculations guaranteed. If you pay an IRS or state penalty or interest because of a TurboTax calculations error, we'll pay you the penalty and interest.
https://turbotax.intuit.com/corp/guarantees.jsp

Income Tax Form 1040ez

Taxslayer MilitaryFile Free State And Federal Taxes OnlineIrs Form 1040ez 2010Hr Block Taxes Online2012 State Tax FormsAmend TaxAmend My Taxes Free OnlineDo I File Taxes Past Years1040ez Form 2013Where Amend 1040xHow To File Amended Tax Return1040 State Tax FormTax Return 2012Irs E FileState Tax Return AddressAmend 2012 Tax Return Free2012 Amended 1040xHelp Me File 1040ezAmendment TaxesFile State Tax Returns Free1040 Ez Form 2012Free E File 2012 Taxes2012 Form 1040ez1040ez Form For 2010Filing A 1040xH&rblockFree Federal TaxesHow To File Taxes For 2012Fillable 1040xCan Still E File 2011 TaxesAmended Tax Return 2012Military Income Tax2011 1040 Ez FormCan I Do My State Taxes Online For FreeWhere Can I File My 2012 Taxes Online For FreeE Filing Income TaxHr BlockIrs Amended Return FormE File State Tax Only For FreeFreefilefillableforms

Income Tax Form 1040ez

Income tax form 1040ez 31. Income tax form 1040ez   Tax on Unearned Income of Certain Children Table of Contents What's New Introduction Useful Items - You may want to see: Which Parent's Return To UseParents Who Do Not File a Joint Return Parent's Election To Report Child's Interest and DividendsEffect of Making the Election Figuring Child's Income Figuring Additional Tax Tax for Certain Children Who Have Unearned IncomeProviding Parental Information (Form 8615, lines A–C) Step 1. Income tax form 1040ez Figuring the Child's Net Unearned Income (Form 8615, Part I) Step 2. Income tax form 1040ez Figuring Tentative Tax at the Parent's Tax Rate (Form 8615, Part II) Step 3. Income tax form 1040ez Figuring the Child's Tax (Form 8615, Part III) What's New Net Investment Income Tax. Income tax form 1040ez . Income tax form 1040ez  For tax years beginning after December 31, 2012, a child whose tax is figured on Form 8615 may be subject to the Net Investment Income Tax (NIIT). Income tax form 1040ez NIIT is a 3. Income tax form 1040ez 8% tax on the lesser of the net investment income or the excess of the child's modified adjusted gross income (MAGI) over the threshold amount. Income tax form 1040ez Use Form 8960, Net Investment Income Tax, to figure this tax. Income tax form 1040ez For more information on NIIT, go to www. Income tax form 1040ez irs. Income tax form 1040ez gov and enter “Net Investment Income Tax” in the search box. Income tax form 1040ez Introduction This chapter discusses the following two rules that may affect the tax on unearned income of certain children. Income tax form 1040ez If the child's interest and dividend income (including capital gain distributions) total less than $10,000, the child's parent may be able to choose to include that income on the parent's return rather than file a return for the child. Income tax form 1040ez (See Parent's Election To Report Child's Interest and Dividends , later. Income tax form 1040ez ) If the child's interest, dividends, and other unearned income total more than $2,000, part of that income may be taxed at the parent's tax rate instead of the child's tax rate. Income tax form 1040ez (See Tax for Certain Children Who Have Unearned Income , later. Income tax form 1040ez ) For these rules, the term “child” includes a legally adopted child and a stepchild. Income tax form 1040ez These rules apply whether or not the child is a dependent. Income tax form 1040ez Useful Items - You may want to see: Publication 929 Tax Rules for Children and Dependents Form (and Instructions) 8615 Tax for Certain Children Who Have Unearned Income 8814 Parents' Election To Report Child's Interest and Dividends Which Parent's Return To Use If a child's parents are married to each other and file a joint return, use the joint return to figure the tax on the child's unearned income. Income tax form 1040ez The tax rate and other return information from that return are used to figure the child's tax as explained later under Tax for Certain Children Who Have Unearned Income . Income tax form 1040ez Parents Who Do Not File a Joint Return For parents who do not file a joint return, the following discussions explain which parent's tax return must be used to figure the tax. Income tax form 1040ez Only the parent whose tax return is used can make the election described under Parent's Election To Report Child's Interest and Dividends . Income tax form 1040ez Parents are married. Income tax form 1040ez   If the child's parents file separate returns, use the return of the parent with the greater taxable income. Income tax form 1040ez Parents not living together. Income tax form 1040ez   If the child's parents are married to each other but not living together, and the parent with whom the child lives (the custodial parent) is considered unmarried, use the return of the custodial parent. Income tax form 1040ez If the custodial parent is not considered unmarried, use the return of the parent with the greater taxable income. Income tax form 1040ez   For an explanation of when a married person living apart from his or her spouse is considered unmarried, see Head of Household in chapter 2. Income tax form 1040ez Parents are divorced. Income tax form 1040ez   If the child's parents are divorced or legally separated, and the parent who had custody of the child for the greater part of the year (the custodial parent) has not remarried, use the return of the custodial parent. Income tax form 1040ez Custodial parent remarried. Income tax form 1040ez   If the custodial parent has remarried, the stepparent (rather than the noncustodial parent) is treated as the child's other parent. Income tax form 1040ez Therefore, if the custodial parent and the stepparent file a joint return, use that joint return. Income tax form 1040ez Do not use the return of the noncustodial parent. Income tax form 1040ez   If the custodial parent and the stepparent are married, but file separate returns, use the return of the one with the greater taxable income. Income tax form 1040ez If the custodial parent and the stepparent are married but not living together, the earlier discussion under Parents not living together applies. Income tax form 1040ez Parents never married. Income tax form 1040ez   If a child's parents have never been married to each other, but lived together all year, use the return of the parent with the greater taxable income. Income tax form 1040ez If the parents did not live together all year, the rules explained earlier under Parents are divorced apply. Income tax form 1040ez Widowed parent remarried. Income tax form 1040ez   If a widow or widower remarries, the new spouse is treated as the child's other parent. Income tax form 1040ez The rules explained earlier under Custodial parent remarried apply. Income tax form 1040ez Parent's Election To Report Child's Interest and Dividends You may be able to elect to include your child's interest and dividend income (including capital gain distributions) on your tax return. Income tax form 1040ez If you do, your child will not have to file a return. Income tax form 1040ez You can make this election only if all the following conditions are met. Income tax form 1040ez Your child was under age 19 (or under age 24 if a full-time student) at the end of the year. Income tax form 1040ez Your child had income only from interest and dividends (including capital gain distributions and Alaska Permanent Fund dividends). Income tax form 1040ez The child's gross income was less than $10,000. Income tax form 1040ez The child is required to file a return unless you make this election. Income tax form 1040ez The child does not file a joint return for the year. Income tax form 1040ez No estimated tax payment was made for the year, and no overpayment from the previous year (or from any amended return) was applied to this year under your child's name and social security number. Income tax form 1040ez No federal income tax was taken out of your child's income under the backup withholding rules. Income tax form 1040ez You are the parent whose return must be used when applying the special tax rules for children. Income tax form 1040ez (See Which Parent's Return To Use , earlier. Income tax form 1040ez ) These conditions are also shown in Figure 31-A. Income tax form 1040ez Certain January 1 birthdays. Income tax form 1040ez   A child born on January 1, 1995, is considered to be age 19 at the end of 2013. Income tax form 1040ez You cannot make this election for such a child unless the child was a full-time student. Income tax form 1040ez   A child born on January 1, 1990, is considered to be age 24 at the end of 2013. Income tax form 1040ez You cannot make this election for such a child. Income tax form 1040ez Full-time student. Income tax form 1040ez   A full-time student is a child who during some part of each of any 5 calendar months of the year was enrolled as a full-time student at a school, or took a full-time on-farm training course given by a school or a state, county, or local government agency. Income tax form 1040ez A school includes a technical, trade, or mechanical school. Income tax form 1040ez It does not include an on-the-job training course, correspondence school, or school offering courses only through the Internet. Income tax form 1040ez How to make the election. Income tax form 1040ez   Make the election by attaching Form 8814 to your Form 1040. Income tax form 1040ez (If you make this election, you cannot file Form 1040A or Form 1040EZ. Income tax form 1040ez ) Attach a separate Form 8814 for each child for whom you make the election. Income tax form 1040ez You can make the election for one or more children and not for others. Income tax form 1040ez Effect of Making the Election The federal income tax on your child's income may be more if you make the Form 8814 election. Income tax form 1040ez Rate may be higher. Income tax form 1040ez   If your child received qualified dividends or capital gain distributions, you may pay up to $100 more tax if you make this election instead of filing a separate tax return for the child. Income tax form 1040ez This is because the tax rate on the child's income between $1,000 and $2,000 is 10% if you make this election. Income tax form 1040ez However, if you file a separate return for the child, the tax rate may be as low as 0% (zero percent) because of the preferential tax rates for qualified dividends and capital gain distributions. Income tax form 1040ez Deductions you cannot take. Income tax form 1040ez   By making the Form 8814 election, you cannot take any of the following deductions that the child would be entitled to on his or her return. Income tax form 1040ez The additional standard deduction if the child is blind. Income tax form 1040ez The deduction for a penalty on an early withdrawal of your child's savings. Income tax form 1040ez Itemized deductions (such as your child's investment expenses or charitable contributions). Income tax form 1040ez Reduced deductions or credits. Income tax form 1040ez   If you use Form 8814, your increased adjusted gross income may reduce certain deductions or credits on your return including the following. Income tax form 1040ez Deduction for contributions to a traditional individual retirement arrangement (IRA). Income tax form 1040ez Deduction for student loan interest. Income tax form 1040ez Itemized deductions for medical expenses, casualty and theft losses, and certain miscellaneous expenses. Income tax form 1040ez Credit for child and dependent care expenses. Income tax form 1040ez Child tax credit. Income tax form 1040ez Education tax credits. Income tax form 1040ez Earned income credit. Income tax form 1040ez Penalty for underpayment of estimated tax. Income tax form 1040ez   If you make this election for 2013 and did not have enough tax withheld or pay enough estimated tax to cover the tax you owe, you may be subject to a penalty. Income tax form 1040ez If you plan to make this election for 2014, you may need to increase your federal income tax withholding or your estimated tax payments to avoid the penalty. Income tax form 1040ez See chapter 4 for more information. Income tax form 1040ez Figuring Child's Income Use Form 8814, Part I, to figure your child's interest and dividend income to report on your return. Income tax form 1040ez Only the amount over $2,000 is added to your income. Income tax form 1040ez The amount over $2,000 is shown on Form 8814, line 6. Income tax form 1040ez Unless the child's income includes qualified dividends or capital gain distributions (discussed next), the same amount is shown on Form 8814, line 12. Income tax form 1040ez Include the amount from Form 8814, line 12, on Form 1040, line 21. Income tax form 1040ez Enter “Form 8814” on the dotted line next to line 21. Income tax form 1040ez If you file more than one Form 8814, include the total amounts from line 12 of all your Forms 8814 on Form 1040, line 21. Income tax form 1040ez Capital gain distributions and qualified dividends. Income tax form 1040ez   If your child's dividend income included any capital gain distributions, see Capital gain distributions under Figuring Child's Income in Publication 929, Part 2. Income tax form 1040ez If your child's dividend income included any qualified dividends, see Qualified dividends under Figuring Child's Income in Publication 929, Part 2. Income tax form 1040ez Figuring Additional Tax Use Form 8814, Part II, to figure the tax on the $2,000 of your child's interest and dividends that you do not include in your income. Income tax form 1040ez This tax is added to the tax figured on your income. Income tax form 1040ez This additional tax is the smaller of: 10% × (your child's gross income − $1,000), or $100. Income tax form 1040ez Include the amount from line 15 of all your Forms 8814 in the total on Form 1040, line 44. Income tax form 1040ez Check box a on Form 1040, line 44. Income tax form 1040ez Figure 31-A. Income tax form 1040ez Can You Include Your Child's Income On Your Tax Return? Please click here for the text description of the image. Income tax form 1040ez Figure 31–A. Income tax form 1040ez Can You Include Your Child's Income On Your Tax Return? Tax for Certain Children Who Have Unearned Income If a child's interest, dividends, and other unearned income total more than $2,000, part of that income may be taxed at the parent's tax rate instead of the child's tax rate. Income tax form 1040ez If the parent does not or cannot choose to include the child's income on the parent's return, use Form 8615 to figure the child's tax. Income tax form 1040ez Attach the completed form to the child's Form 1040 or Form 1040A. Income tax form 1040ez When Form 8615 must be filed. Income tax form 1040ez   Form 8615 must be filed for a child if all of the following statements are true. Income tax form 1040ez The child's investment income was more than $2,000. Income tax form 1040ez The child is required to file a return for 2013. Income tax form 1040ez The child either: Was under age 18 at the end of the year, Was age 18 at the end of the year and did not have earned income that was more than half of his or her support, or Was over age 18 and under age 24 at the end of the year, was a full-time student, and did not have earned income that was more than half of his or her support. Income tax form 1040ez At least one of the child's parents was alive at the end of 2013. Income tax form 1040ez The child does not file a joint return for 2013. Income tax form 1040ez These conditions are also shown in  Figure 31-B. Income tax form 1040ez Earned income. Income tax form 1040ez   Earned income includes salaries, wages, tips, and other payments received for personal services performed. Income tax form 1040ez It does not include unearned income as defined later in this chapter. Income tax form 1040ez Support. Income tax form 1040ez   Your child's support includes all amounts spent to provide the child with food, lodging, clothing, education, medical and dental care, recreation, transportation, and similar necessities. Income tax form 1040ez To figure your child's support, count support provided by you, your child, and others. Income tax form 1040ez However, a scholarship received by your child is not considered support if your child is a full-time student. Income tax form 1040ez See chapter 3 for details about support. Income tax form 1040ez Certain January 1 birthdays. Income tax form 1040ez   Use the following chart to determine whether certain children with January 1 birthdays meet condition 3 under When Form 8615 must be filed. Income tax form 1040ez Figure 31-B. Income tax form 1040ez Do You Have To Use Form 8615 To Figure Your Child's Tax? Please click here for the text description of the image. Income tax form 1040ez Figure 31-B. Income tax form 1040ez Do You Have To Use Form 8615 To Figure Your Child's Tax?    IF a child was born on. Income tax form 1040ez . Income tax form 1040ez . Income tax form 1040ez THEN, at the end of 2013, the child is considered to be. Income tax form 1040ez . Income tax form 1040ez . Income tax form 1040ez January 1, 1996 18* January 1, 1995 19** January 1, 1990 24*** *This child is not under age 18. Income tax form 1040ez The child meets condition 3 only if the child did not have earned income that was more than half of the child's support. Income tax form 1040ez  **This child meets condition 3 only if the child was a full-time student who did not have earned income that was more than half of the child's support. Income tax form 1040ez  ***Do not use Form 8615 for this child. Income tax form 1040ez Providing Parental Information (Form 8615, lines A–C) On Form 8615, lines A and B, enter the parent's name and social security number. Income tax form 1040ez (If the parents filed a joint return, enter the name and social security number listed first on the joint return. Income tax form 1040ez ) On line C, check the box for the parent's filing status. Income tax form 1040ez See Which Parent's Return To Use at the beginning of this chapter for information on which parent's return information must be used on Form 8615. Income tax form 1040ez Parent with different tax year. Income tax form 1040ez   If the parent and the child do not have the same tax year, complete Form 8615 using the information on the parent's return for the tax year that ends in the child's tax year. Income tax form 1040ez Parent's return information not known timely. Income tax form 1040ez   If the information needed from the parent's return is not known by the time the child's return is due (usually April 15), you can file the return using estimates. Income tax form 1040ez   You can use any reasonable estimate. Income tax form 1040ez This includes using information from last year's return. Income tax form 1040ez If you use an estimated amount on Form 8615, enter “Estimated” on the line next to the amount. Income tax form 1040ez    When you get the correct information, file an amended return on Form 1040X, Amended U. Income tax form 1040ez S. Income tax form 1040ez Individual Income Tax Return. Income tax form 1040ez   Instead of using estimates, you can get an automatic 6-month extension of time to file if, by the date your return is due, you file Form 4868, Application for Automatic Extension of Time To File U. Income tax form 1040ez S. Income tax form 1040ez Individual Income Tax Return. Income tax form 1040ez Extensions are discussed in chapter 1. Income tax form 1040ez Step 1. Income tax form 1040ez Figuring the Child's Net Unearned Income (Form 8615, Part I) The first step in figuring a child's tax using Form 8615 is to figure the child's net unearned income. Income tax form 1040ez To do that, use Form 8615, Part I. Income tax form 1040ez Line 1 (unearned income). Income tax form 1040ez   If the child had no earned income, enter on this line the adjusted gross income shown on the child's return. Income tax form 1040ez Adjusted gross income is shown on Form 1040, line 38, or Form 1040A, line 22. Income tax form 1040ez Form 1040EZ cannot be used if Form 8615 must be filed. Income tax form 1040ez   If the child had earned income, figure the amount to enter on Form 8615, line 1, by using the worksheet in the instructions for the form. Income tax form 1040ez   However, if the child has: excluded any foreign earned income, deducted either a loss from self-employment, or deducted a net operating loss from another year, then use the Alternate Worksheet for Form 8615, Line 1, in Publication 929 to figure the amount to enter on Form 8615, line 1. Income tax form 1040ez Unearned income defined. Income tax form 1040ez   Unearned income is generally all income other than salaries, wages, and other amounts received as pay for work actually done. Income tax form 1040ez It includes taxable interest, dividends (including capital gain distributions), capital gains, unemployment compensation, the taxable part of social security and pension payments, and certain distributions from trusts. Income tax form 1040ez Unearned income includes amounts produced by assets the child obtained with earned income (such as interest on a savings account into which the child deposited wages). Income tax form 1040ez Nontaxable income. Income tax form 1040ez   For this purpose, unearned income includes only amounts the child must include in total income. Income tax form 1040ez Nontaxable unearned income, such as tax-exempt interest and the nontaxable part of social security and pension payments, is not included. Income tax form 1040ez Income from property received as a gift. Income tax form 1040ez   A child's unearned income includes all income produced by property belonging to the child. Income tax form 1040ez This is true even if the property was transferred to the child, regardless of when the property was transferred or purchased or who transferred it. Income tax form 1040ez   A child's unearned income includes income produced by property given as a gift to the child. Income tax form 1040ez This includes gifts to the child from grandparents or any other person and gifts made under the Uniform Gift to Minors Act. Income tax form 1040ez Example. Income tax form 1040ez Amanda Black, age 13, received the following income. Income tax form 1040ez Dividends — $800 Wages — $2,100 Taxable interest — $1,200 Tax-exempt interest — $100 Net capital gains — $100 The dividends were qualified dividends on stock given to her by her grandparents. Income tax form 1040ez Amanda's unearned income is $2,100. Income tax form 1040ez This is the total of the dividends ($800), taxable interest ($1,200), and net capital gains ($100). Income tax form 1040ez Her wages are earned (not unearned) income because they are received for work actually done. Income tax form 1040ez Her tax-exempt interest is not included because it is nontaxable. Income tax form 1040ez Trust income. Income tax form 1040ez   If a child is the beneficiary of a trust, distributions of taxable interest, dividends, capital gains, and other unearned income from the trust are unearned income to the child. Income tax form 1040ez   However, for purposes of completing Form 8615, a taxable distribution from a qualified disability trust is considered earned income, not unearned income. Income tax form 1040ez Line 2 (deductions). Income tax form 1040ez   If the child does not itemize deductions on Schedule A (Form 1040), enter $2,000 on line 2. Income tax form 1040ez   If the child does itemize deductions, enter on line 2 the larger of: $1,000 plus the portion of the child's itemized deductions on Schedule A (Form 1040), line 29, that are directly connected with the production of unearned income entered on line 1, or $2,000. Income tax form 1040ez Directly connected. Income tax form 1040ez   Itemized deductions are directly connected with the production of unearned income if they are for expenses paid to produce or collect taxable income or to manage, conserve, or maintain property held for producing income. Income tax form 1040ez These expenses include custodian fees and service charges, service fees to collect taxable interest and dividends, and certain investment counsel fees. Income tax form 1040ez   These expenses are added to certain other miscellaneous itemized deductions on Schedule A (Form 1040). Income tax form 1040ez Only the amount greater than 2% of the child's adjusted gross income can be deducted. Income tax form 1040ez See chapter 28 for more information. Income tax form 1040ez Example 1. Income tax form 1040ez Roger, age 12, has unearned income of $8,000, no other income, no adjustments to income, and itemized deductions of $300 (net of the 2% limit) that are directly connected with his unearned income. Income tax form 1040ez His adjusted gross income is $8,000, which is entered on Form 1040, line 38, and on Form 8615, line 1. Income tax form 1040ez Roger enters $2,000 on line 2 because that is more than the total of $1,000 plus his directly connected itemized deductions of $300. Income tax form 1040ez Example 2. Income tax form 1040ez Eleanor, age 8, has unearned income of $16,000 and an early withdrawal penalty of $100. Income tax form 1040ez She has no other income. Income tax form 1040ez She has itemized deductions of $1,050 (net of the 2% limit) that are directly connected with the production of her unearned income. Income tax form 1040ez Her adjusted gross income, entered on line 1, is $15,900 ($16,000 − $100). Income tax form 1040ez The amount on line 2 is $2,050. Income tax form 1040ez This is the larger of: $1,000 plus the $1,050 of directly connected itemized deductions, or $2,000. Income tax form 1040ez Line 3. Income tax form 1040ez   Subtract line 2 from line 1 and enter the result on this line. Income tax form 1040ez If zero or less, do not complete the rest of the form. Income tax form 1040ez However, you must still attach Form 8615 to the child's tax return. Income tax form 1040ez Figure the tax on the child's taxable income in the normal manner. Income tax form 1040ez Line 4 (child's taxable income). Income tax form 1040ez   Enter on line 4 the child's taxable income from Form 1040, line 43, or Form 1040A, line 27. Income tax form 1040ez   However, if the child files Form 2555 or 2555-EZ to claim the foreign earned income exclusion, housing exclusion, or housing deduction, see the Form 8615 instructions or Pub. Income tax form 1040ez 929. Income tax form 1040ez Line 5 (net unearned income). Income tax form 1040ez   A child's net unearned income cannot be more than his or her taxable income. Income tax form 1040ez Enter on Form 8615, line 5, the smaller of line 3 or line 4. Income tax form 1040ez This is the child's net unearned income. Income tax form 1040ez   If zero or less, do not complete the rest of the form. Income tax form 1040ez However, you must still attach Form 8615 to the child's tax return. Income tax form 1040ez Figure the tax on the child's taxable income in the normal manner. Income tax form 1040ez Step 2. Income tax form 1040ez Figuring Tentative Tax at the Parent's Tax Rate (Form 8615, Part II) The next step in completing Form 8615 is to figure a tentative tax on the child's net unearned income at the parent's tax rate. Income tax form 1040ez The tentative tax at the parent's tax rate is the difference between the tax on the parent's taxable income figured with the child's net unearned income (plus the net unearned income of any other child whose Form 8615 includes the tax return information of that parent) and the tax figured without it. Income tax form 1040ez When figuring the tentative tax at the parent's tax rate on Form 8615, do not refigure any of the exclusions, deductions, or credits on the parent's return because of the child's net unearned income. Income tax form 1040ez For example, do not refigure the medical expense deduction. Income tax form 1040ez Figure the tentative tax on Form 8615, lines 6 through 13. Income tax form 1040ez Note. Income tax form 1040ez If the child or parent has any capital gains or losses, get Publication 929 for help in completing Form 8615, Part II. Income tax form 1040ez Line 6 (parent's taxable income). Income tax form 1040ez   Enter on line 6 the parent's taxable income from Form 1040, line 43, Form 1040A, line 27, or Form 1040EZ, line 6. Income tax form 1040ez   If the Foreign Earned Income Tax Worksheet (in the Form 1040 instructions) was used to figure the parent's tax, enter the amount from line 3 of that worksheet instead of the parent's taxable income. Income tax form 1040ez Line 7 (net unearned income of other children). Income tax form 1040ez   If the tax return information of the parent is also used on any other child's Form 8615, enter on line 7 the total of the amounts from line 5 of all the other children's Forms 8615. Income tax form 1040ez Do not include the amount from line 5 of the Form 8615 being completed. Income tax form 1040ez Example. Income tax form 1040ez Paul and Jane Persimmon have three children, Sharon, Jerry, and Mike, who must attach Form 8615 to their tax returns. Income tax form 1040ez The children's net unearned income amounts on line 5 of their Forms 8615 are: Sharon — $800 Jerry — $600 Mike — $1,000 Line 7 of Sharon's Form 8615 will show $1,600, the total of the amounts on line 5 of Jerry's and Mike's Forms 8615. Income tax form 1040ez Line 7 of Jerry's Form 8615 will show $1,800 ($800 + $1,000). Income tax form 1040ez Line 7 of Mike's Form 8615 will show $1,400 ($800 + $600). Income tax form 1040ez Other children's information not available. Income tax form 1040ez   If the net unearned income of the other children is not available when the return is due, either file the return using estimates or get an extension of time to file. Income tax form 1040ez See Parent's return information not known timely , earlier. Income tax form 1040ez Line 11 (tentative tax). Income tax form 1040ez   Subtract line 10 from line 9 and enter the result on this line. Income tax form 1040ez This is the tentative tax. Income tax form 1040ez   If line 7 is blank, skip lines 12a and 12b and enter the amount from line 11 on line 13. Income tax form 1040ez Also skip the discussion for lines 12a and 12b that follows. Income tax form 1040ez Lines 12a and 12b (dividing the tentative tax). Income tax form 1040ez   If an amount is entered on line 7, divide the tentative tax shown on line 11 among the children according to each child's share of the total net unearned income. Income tax form 1040ez This is done on lines 12a, 12b, and 13. Income tax form 1040ez Add the amount on line 7 to the amount on line 5 and enter the total on line 12a. Income tax form 1040ez Divide the amount on line 5 by the amount on line 12a and enter the result, as a decimal, on line 12b. Income tax form 1040ez Example. Income tax form 1040ez In the earlier example under Line 7 (net unearned income of other children), Sharon's Form 8615 shows $1,600 on line 7. Income tax form 1040ez The amount entered on line 12a is $2,400, the total of the amounts on lines 5 and 7 ($800 + $1,600). Income tax form 1040ez The decimal on line 12b is  . Income tax form 1040ez 333, figured as follows and rounded to three places. Income tax form 1040ez   $800 = . Income tax form 1040ez 333     $2,400   Step 3. Income tax form 1040ez Figuring the Child's Tax (Form 8615, Part III) The final step in figuring a child's tax using Form 8615 is to determine the larger of: The total of: The child's share of the tentative tax based on the parent's tax rate, plus The tax on the child's taxable income in excess of net unearned income, figured at the child's tax rate, or The tax on the child's taxable income, figured at the child's tax rate. Income tax form 1040ez This is the child's tax. Income tax form 1040ez It is figured on Form 8615, lines 14 through 18. Income tax form 1040ez Alternative minimum tax. Income tax form 1040ez   A child may be subject to alternative minimum tax (AMT) if he or she has certain items given preferential treatment under the tax law. Income tax form 1040ez See Alternative Minimum Tax (AMT) in chapter 30. Income tax form 1040ez    For more information on who is liable for AMT and how to figure it, see Form 6251, Alternative Minimum Tax—Individuals. Income tax form 1040ez For information on special limits that apply to a child who files Form 6251, see Certain Children Under Age 24 in the Instructions for Form 6251. Income tax form 1040ez Prev  Up  Next   Home   More Online Publications
Español

Currency and Economy

Find information on coins, currency exchange rates, changes to U.S. bills, budget, key economic indicators and more.

The Income Tax Form 1040ez

Income tax form 1040ez Publication 939 - Main Content Table of Contents General Information Taxation of Periodic PaymentsInvestment in the Contract Expected Return Computation Under the General Rule How To Use Actuarial TablesUnisex Annuity Tables Special Elections Worksheets for Determining Taxable Annuity Actuarial Tables Requesting a Ruling on Taxation of Annuity How To Get Tax HelpLow Income Taxpayer Clinics General Information Some of the terms used in this publication are defined in the following paragraphs. Income tax form 1040ez A pension is generally a series of payments made to you after you retire from work. Income tax form 1040ez Pension payments are made regularly and are for past services with an employer. Income tax form 1040ez An annuity is a series of payments under a contract. Income tax form 1040ez You can buy the contract alone or you can buy it with the help of your employer. Income tax form 1040ez Annuity payments are made regularly for more than one full year. Income tax form 1040ez Note. Income tax form 1040ez Distributions from pensions and annuities follow the same rules as outlined in this publication unless otherwise noted. Income tax form 1040ez Types of pensions and annuities. Income tax form 1040ez   Particular types of pensions and annuities include: Fixed period annuities. Income tax form 1040ez You receive definite amounts at regular intervals for a definite length of time. Income tax form 1040ez Annuities for a single life. Income tax form 1040ez You receive definite amounts at regular intervals for life. Income tax form 1040ez The payments end at death. Income tax form 1040ez Joint and survivor annuities. Income tax form 1040ez The first annuitant receives a definite amount at regular intervals for life. Income tax form 1040ez After he or she dies, a second annuitant receives a definite amount at regular intervals for life. Income tax form 1040ez The amount paid to the second annuitant may or may not differ from the amount paid to the first annuitant. Income tax form 1040ez Variable annuities. Income tax form 1040ez You receive payments that may vary in amount for a definite length of time or for life. Income tax form 1040ez The amounts you receive may depend upon such variables as profits earned by the pension or annuity funds or cost-of-living indexes. Income tax form 1040ez Disability pensions. Income tax form 1040ez You are under minimum retirement age and receive payments because you retired on disability. Income tax form 1040ez If, at the time of your retirement, you were permanently and totally disabled, you may be eligible for the credit for the elderly or the disabled discussed in Publication 524. Income tax form 1040ez If your annuity starting date is after November 18, 1996, the General Rule cannot be used for the following qualified plans. Income tax form 1040ez A qualified employee plan is an employer's stock bonus, pension, or profit-sharing plan that is for the exclusive benefit of employees or their beneficiaries. Income tax form 1040ez This plan must meet Internal Revenue Code requirements. Income tax form 1040ez It qualifies for special tax benefits, including tax deferral for employer contributions and rollover distributions. Income tax form 1040ez However, you must use the General Rule if you were 75 or over and the annuity payments are guaranteed for more than 5 years. Income tax form 1040ez A qualified employee annuity is a retirement annuity purchased by an employer for an employee under a plan that meets Internal Revenue Code requirements. Income tax form 1040ez A tax-sheltered annuity is a special annuity plan or contract purchased for an employee of a public school or tax-exempt organization. Income tax form 1040ez   The General Rule is used to figure the tax treatment of various types of pensions and annuities, including nonqualified employee plans. Income tax form 1040ez A nonqualified employee plan is an employer's plan that does not meet Internal Revenue Code requirements. Income tax form 1040ez It does not qualify for most of the tax benefits of a qualified plan. Income tax form 1040ez Annuity worksheets. Income tax form 1040ez   The worksheets found near the end of the text of this publication may be useful to you in figuring the taxable part of your annuity. Income tax form 1040ez Request for a ruling. Income tax form 1040ez   If you are unable to determine the income tax treatment of your pension or annuity, you may ask the Internal Revenue Service to figure the taxable part of your annuity payments. Income tax form 1040ez This is treated as a request for a ruling. Income tax form 1040ez See Requesting a Ruling on Taxation of Annuity near the end of this publication. Income tax form 1040ez Withholding tax and estimated tax. Income tax form 1040ez   Your pension or annuity is subject to federal income tax withholding unless you choose not to have tax withheld. Income tax form 1040ez If you choose not to have tax withheld from your pension or annuity, or if you do not have enough income tax withheld, you may have to make estimated tax payments. Income tax form 1040ez Taxation of Periodic Payments This section explains how the periodic payments you receive under a pension or annuity plan are taxed under the General Rule. Income tax form 1040ez Periodic payments are amounts paid at regular intervals (such as weekly, monthly, or yearly) for a period of time greater than one year (such as for 15 years or for life). Income tax form 1040ez These payments are also known as amounts received as an annuity. Income tax form 1040ez If you receive an amount from your plan that is a nonperiodic payment (amount not received as an annuity), see Taxation of Nonperiodic Payments in Publication 575. Income tax form 1040ez In general, you can recover your net cost of the pension or annuity tax free over the period you are to receive the payments. Income tax form 1040ez The amount of each payment that is more than the part that represents your net cost is taxable. Income tax form 1040ez Under the General Rule, the part of each annuity payment that represents your net cost is in the same proportion that your investment in the contract is to your expected return. Income tax form 1040ez These terms are explained in the following discussions. Income tax form 1040ez Investment in the Contract In figuring how much of your pension or annuity is taxable under the General Rule, you must figure your investment in the contract. Income tax form 1040ez First, find your net cost of the contract as of the annuity starting date (defined later). Income tax form 1040ez To find this amount, you must first figure the total premiums, contributions, or other amounts paid. Income tax form 1040ez This includes the amounts your employer contributed if you were required to include these amounts in income. Income tax form 1040ez It also includes amounts you actually contributed (except amounts for health and accident benefits and deductible voluntary employee contributions). Income tax form 1040ez From this total cost you subtract: Any refunded premiums, rebates, dividends, or unrepaid loans (any of which were not included in your income) that you received by the later of the annuity starting date or the date on which you received your first payment. Income tax form 1040ez Any additional premiums paid for double indemnity or disability benefits. Income tax form 1040ez Any other tax-free amounts you received under the contract or plan before the later of the dates in (1). Income tax form 1040ez The annuity starting date   is the later of the first day of the first period for which you receive payment under the contract or the date on which the obligation under the contract becomes fixed. Income tax form 1040ez Example. Income tax form 1040ez On January 1 you completed all your payments required under an annuity contract providing for monthly payments starting on August 1, for the period beginning July 1. Income tax form 1040ez The annuity starting date is July 1. Income tax form 1040ez This is the date you use in figuring your investment in the contract and your expected return (discussed later). Income tax form 1040ez Adjustments If any of the following items apply, adjust (add or subtract) your total cost to find your net cost. Income tax form 1040ez Foreign employment. Income tax form 1040ez   If you worked abroad, your cost may include contributions by your employer to the retirement plan, but only if those contributions would be excludible from your gross income had they been paid directly to you as compensation. Income tax form 1040ez The contributions that apply are: Contributions before 1963 by your employer, Contributions after 1962 by your employer if the contributions would be excludible from your gross income (without regard to the foreign earned income exclusion) had they been paid directly to you, or Contributions after 1996 by your employer on your behalf if you performed the services of a foreign missionary (a duly ordained, commissioned, or licensed minister of a church or a lay person) if the contributions would be excludible from your gross income had they been paid directly to you. Income tax form 1040ez Foreign employment contributions while a nonresident alien. Income tax form 1040ez   In determining your cost, special rules apply if you are a U. Income tax form 1040ez S. Income tax form 1040ez citizen or resident alien who received distributions from a plan to which contributions were made while you were a nonresident alien. Income tax form 1040ez Your contributions and your employer's contributions are not included in your cost if the contributions: Were made based on compensation which was for services performed outside the United States which you were a nonresident alien, and Were not subject to income tax under the laws of the United States or any foreign country, but only if the contribution would have been subject to income tax if they had been paid as cash compensation when the services were performed. Income tax form 1040ez Death benefit exclusion. Income tax form 1040ez   If you are the beneficiary of a deceased employee (or former employee), who died before August 21, 1996, you may qualify for a death benefit exclusion of up to $5,000. Income tax form 1040ez The beneficiary of a deceased employee who died after August 20, 1996, will not qualify for the death benefit exclusion. Income tax form 1040ez How to adjust your total cost. Income tax form 1040ez   If you are eligible, treat the amount of any allowable death benefit exclusion as additional cost paid by the employee. Income tax form 1040ez Add it to the cost or unrecovered cost of the annuity at the annuity starting date. Income tax form 1040ez See Example 3 under Computation Under General Rule for an illustration of the adjustment to the cost of the contract. Income tax form 1040ez Net cost. Income tax form 1040ez   Your total cost plus certain adjustments and minus other amounts already recovered before the annuity starting date is your net cost. Income tax form 1040ez This is the unrecovered investment in the contract as of the annuity starting date. Income tax form 1040ez If your annuity starting date is after 1986, this is the maximum amount that you may recover tax free under the contract. Income tax form 1040ez Refund feature. Income tax form 1040ez   Adjustment for the value of the refund feature is only applicable when you report your pension or annuity under the General Rule. Income tax form 1040ez Your annuity contract has a refund feature if: The expected return ( discussed later) of an annuity depends entirely or partly on the life of one or more individuals, The contract provides that payments will be made to a beneficiary or the estate of an annuitant on or after the death of the annuitant if a stated amount or a stated number of payments has not been paid to the annuitant or annuitants before death, and The payments are a refund of the amount you paid for the annuity contract. Income tax form 1040ez   If your annuity has a refund feature, you must reduce your net cost of the contract by the value of the refund feature (figured using Table III or VII at the end of this publication, also see How To Use Actuarial Tables , later) to find the investment in the contract. Income tax form 1040ez Zero value of refund feature. Income tax form 1040ez   For a joint and survivor annuity, the value of the refund feature is zero if: Both annuitants are age 74 or younger, The payments are guaranteed for less than 2½ years, and The survivor's annuity is at least 50% of the first annuitant's annuity. Income tax form 1040ez   For a single-life annuity without survivor benefit, the value of the refund feature is zero if: The payments are guaranteed for less than 2½ years, and The annuitant is: Age 57 or younger (if using the new (unisex) annuity tables), Age 42 or younger (if male and using the old annuity tables), or Age 47 or younger (if female and using the old annuity tables). Income tax form 1040ez   If you do not meet these requirements, you will have to figure the value of the refund feature, as explained in the following discussion. Income tax form 1040ez Examples. Income tax form 1040ez The first example shows how to figure the value of the refund feature when there is only one beneficiary. Income tax form 1040ez Example 2 shows how to figure the value of the refund feature when the contract provides, in addition to a whole life annuity, one or more temporary life annuities for the lives of children. Income tax form 1040ez In both examples, the taxpayer elects to use Tables V through VIII. Income tax form 1040ez If you need the value of the refund feature for a joint and survivor annuity, write to the Internal Revenue Service as explained under Requesting a Ruling on Taxation of Annuity near the end of this publication. Income tax form 1040ez Example 1. Income tax form 1040ez At age 65, Barbara bought for $21,053 an annuity with a refund feature. Income tax form 1040ez She will get $100 a month for life. Income tax form 1040ez Barbara's contract provides that if she does not live long enough to recover the full $21,053, similar payments will be made to her surviving beneficiary until a total of $21,053 has been paid under the contract. Income tax form 1040ez In this case, the contract cost and the total guaranteed return are the same ($21,053). Income tax form 1040ez Barbara's investment in the contract is figured as follows: Net cost $21,053 Amount to be received annually $1,200   Number of years for which payment is guaranteed ($21,053 divided by $1,200) 17. Income tax form 1040ez 54   Rounded to nearest whole number of years 18   Percentage from Actuarial Table VII for age 65 with 18 years of guaranteed payments 15%   Value of the refund feature (rounded to the nearest dollar)—15% of $21,053 3,158 Investment in the contract, adjusted for value of refund feature $17,895       If the total guaranteed return were less than the $21,053 net cost of the contract, Barbara would apply the appropriate percentage from the tables to the lesser amount. Income tax form 1040ez For example, if the contract guaranteed the $100 monthly payments for 17 years to Barbara's estate or beneficiary if she were to die before receiving all the payments for that period, the total guaranteed return would be $20,400 ($100 × 12 × 17 years). Income tax form 1040ez In this case, the value of the refund feature would be $2,856 (14% of $20,400) and Barbara's investment in the contract would be $18,197 ($21,053 minus $2,856) instead of $17,895. Income tax form 1040ez Example 2. Income tax form 1040ez John died while still employed. Income tax form 1040ez His widow, Eleanor, age 48, receives $171 a month for the rest of her life. Income tax form 1040ez John's son, Elmer, age 9, receives $50 a month until he reaches age 18. Income tax form 1040ez John's contributions to the retirement fund totaled $7,559. Income tax form 1040ez 45, with interest on those contributions of $1,602. Income tax form 1040ez 53. Income tax form 1040ez The guarantee or total refund feature of the contract is $9,161. Income tax form 1040ez 98 ($7,559. Income tax form 1040ez 45 plus $1,602. Income tax form 1040ez 53). Income tax form 1040ez The adjustment in the investment in the contract is figured as follows: A) Expected return:*       1) Widow's expected return:         Annual annuity ($171 × 12) $2,052       Multiplied by factor from Table V         (nearest age 48) 34. Income tax form 1040ez 9 $71,614. Income tax form 1040ez 80   2) Child's expected return:         Annual annuity ($50 × 12) $600       Multiplied by factor from         Table VIII (nearest age 9         for term of 9 years) 9. Income tax form 1040ez 0 5,400. Income tax form 1040ez 00   3) Total expected return   $77,014. Income tax form 1040ez 80 B) Adjustment for refund feature:       1) Contributions (net cost) $7,559. Income tax form 1040ez 45   2) Guaranteed amount (contributions of $7,559. Income tax form 1040ez 45 plus interest of $1,602. Income tax form 1040ez 53) $9,161. Income tax form 1040ez 98   3) Minus: Expected return under child's (temporary life) annuity (A(2)) 5,400. Income tax form 1040ez 00   4) Net guaranteed amount $3,761. Income tax form 1040ez 98   5) Multiple from Table VII (nearest age 48 for 2 years duration (recovery of $3,761. Income tax form 1040ez 98 at $171 a month to nearest whole year)) 0%   6) Adjustment required for value of refund feature rounded to the nearest whole dollar  (0% × $3,761. Income tax form 1040ez 98, the smaller of B(3) or B(6)) 0 *Expected return is the total amount you and other eligible annuitants can expect to receive under the contract. Income tax form 1040ez See the discussion of expected return, later in this publication. Income tax form 1040ez Free IRS help. Income tax form 1040ez   If you need to request assistance to figure the value of the refund feature, see Requesting a Ruling on Taxation of Annuity near the end of this publication. Income tax form 1040ez Expected Return Your expected return is the total amount you and other eligible annuitants can expect to receive under the contract. Income tax form 1040ez The following discussions explain how to figure the expected return with each type of annuity. Income tax form 1040ez A person's age, for purposes of figuring the expected return, is the age at the birthday nearest to the annuity starting date. Income tax form 1040ez Fixed period annuity. Income tax form 1040ez   If you will get annuity payments for a fixed number of years, without regard to your life expectancy, you must figure your expected return based on that fixed number of years. Income tax form 1040ez It is the total amount you will get beginning at the annuity starting date. Income tax form 1040ez You will receive specific periodic payments for a definite period of time, such as a fixed number of months (but not less than 13). Income tax form 1040ez To figure your expected return, multiply the fixed number of months for which payments are to be made by the amount of the payment specified for each period. Income tax form 1040ez Single life annuity. Income tax form 1040ez   If you are to get annuity payments for the rest of your life, find your expected return as follows. Income tax form 1040ez You must multiply the amount of the annual payment by a multiple based on your life expectancy as of the annuity starting date. Income tax form 1040ez These multiples are set out in actuarial Tables I and V near the end of this publication (see How To Use Actuarial Tables , later). Income tax form 1040ez   You may need to adjust these multiples if the payments are made quarterly, semiannually, or annually. Income tax form 1040ez See Adjustments to Tables I, II, V, VI, and VIA following Table I. Income tax form 1040ez Example. Income tax form 1040ez Henry bought an annuity contract that will give him an annuity of $500 a month for his life. Income tax form 1040ez If at the annuity starting date Henry's nearest birthday is 66, the expected return is figured as follows: Annual payment ($500 × 12 months) $6,000 Multiple shown in Table V, age 66 × 19. Income tax form 1040ez 2 Expected return $115,200 If the payments were to be made to Henry quarterly and the first payment was made one full month after the annuity starting date, Henry would adjust the 19. Income tax form 1040ez 2 multiple by +. Income tax form 1040ez 1. Income tax form 1040ez His expected return would then be $115,800 ($6,000 × 19. Income tax form 1040ez 3). Income tax form 1040ez Annuity for shorter of life or specified period. Income tax form 1040ez   With this type of annuity, you are to get annuity payments either for the rest of your life or until the end of a specified period, whichever period is shorter. Income tax form 1040ez To figure your expected return, multiply the amount of your annual payment by a multiple in Table IV or VIII for temporary life annuities. Income tax form 1040ez Find the proper multiple based on your sex (if using Table IV), your age at the annuity starting date, and the nearest whole number of years in the specified period. Income tax form 1040ez Example. Income tax form 1040ez Harriet purchased an annuity this year that will pay her $200 each month for five years or until she dies, whichever period is shorter. Income tax form 1040ez She was age 65 at her birthday nearest the annuity starting date. Income tax form 1040ez She figures the expected return as follows: Annual payment ($200 × 12 months) $2,400 Multiple shown in Table VIII, age 65, 5-year term × 4. Income tax form 1040ez 9 Expected return $11,760 She uses Table VIII (not Table IV) because all her contributions were made after June 30, 1986. Income tax form 1040ez See Special Elections, later. Income tax form 1040ez Joint and survivor annuities. Income tax form 1040ez   If you have an annuity that pays you a periodic income for life and after your death provides an identical lifetime periodic income to your spouse (or some other person), you figure the expected return based on your combined life expectancies. Income tax form 1040ez To figure the expected return, multiply the annual payment by a multiple in Table II or VI based on your joint life expectancies. Income tax form 1040ez If your payments are made quarterly, semiannually, or annually, you may need to adjust these multiples. Income tax form 1040ez See Adjustments to Tables I, II, V, VI, and VIA following Table I near the end of this publication. Income tax form 1040ez Example. Income tax form 1040ez John bought a joint and survivor annuity providing payments of $500 a month for his life, and, after his death, $500 a month for the remainder of his wife's life. Income tax form 1040ez At John's annuity starting date, his age at his nearest birthday is 70 and his wife's at her nearest birthday is 67. Income tax form 1040ez The expected return is figured as follows: Annual payment ($500 × 12 months) $6,000 Multiple shown in Table VI, ages 67 and 70 × 22. Income tax form 1040ez 0 Expected return $132,000 Different payments to survivor. Income tax form 1040ez   If your contract provides that payments to a survivor annuitant will be different from the amount you receive, you must use a computation which accounts for both the joint lives of the annuitants and the life of the survivor. Income tax form 1040ez Example 1. Income tax form 1040ez Gerald bought a contract providing for payments to him of $500 a month for life and, after his death, payments to his wife, Mary, of $350 a month for life. Income tax form 1040ez If, at the annuity starting date, Gerald's nearest birthday is 70 and Mary's is 67, the expected return under the contract is figured as follows: Combined multiple for Gerald and Mary, ages 70 and 67 (from Table VI)   22. Income tax form 1040ez 0 Multiple for Gerald, age 70 (from Table V)   16. Income tax form 1040ez 0 Difference: Multiple applicable to Mary   6. Income tax form 1040ez 0 Gerald's annual payment ($500 × 12) $6,000   Gerald's multiple 16. Income tax form 1040ez 0   Gerald's expected return   $96,000 Mary's annual payment ($350 × 12) $4,200   Mary's multiple 6. Income tax form 1040ez 0   Mary's expected return   25,200 Total expected return under the contract   $121,200 Example 2. Income tax form 1040ez Your husband died while still employed. Income tax form 1040ez Under the terms of his employer's retirement plan, you are entitled to get an immediate annuity of $400 a month for the rest of your life or until you remarry. Income tax form 1040ez Your daughters, Marie and Jean, are each entitled to immediate temporary life annuities of $150 a month until they reach age 18. Income tax form 1040ez You were 50 years old at the annuity starting date. Income tax form 1040ez Marie was 16 and Jean was 14. Income tax form 1040ez Using the multiples shown in Tables V and VIII at the end of this publication, the total expected return on the annuity starting date is $169,680, figured as follows: Widow, age 50 (multiple from Table V—33. Income tax form 1040ez 1 × $4,800 annual payment) $158,880 Marie, age 16 for 2 years duration (multiple from Table VIII—2. Income tax form 1040ez 0 × $1,800 annual payment) 3,600 Jean, age 14 for 4 years duration (multiple from Table VIII—4. Income tax form 1040ez 0 × $1,800 annual payment) 7,200 Total expected return $169,680 No computation of expected return is made based on your husband's age at the date of death because he died before the annuity starting date. Income tax form 1040ez Computation Under the General Rule Note. Income tax form 1040ez Variable annuities use a different computation for determining the exclusion amounts. Income tax form 1040ez See Variable annuities later. Income tax form 1040ez Under the General Rule, you figure the taxable part of your annuity by using the following steps: Step 1. Income tax form 1040ez   Figure the amount of your investment in the contract, including any adjustments for the refund feature and the death benefit exclusion, if applicable. Income tax form 1040ez See Death benefit exclusion , earlier. Income tax form 1040ez Step 2. Income tax form 1040ez   Figure your expected return. Income tax form 1040ez Step 3. Income tax form 1040ez   Divide Step 1 by Step 2 and round to three decimal places. Income tax form 1040ez This will give you the exclusion percentage. Income tax form 1040ez Step 4. Income tax form 1040ez   Multiply the exclusion percentage by the first regular periodic payment. Income tax form 1040ez The result is the tax-free part of each pension or annuity payment. Income tax form 1040ez   The tax-free part remains the same even if the total payment increases due to variation in the annuity amount such as cost of living increases, or you outlive the life expectancy factor used. Income tax form 1040ez However, if your annuity starting date is after 1986, the total amount of annuity income that is tax free over the years cannot exceed your net cost. Income tax form 1040ez   Each annuitant applies the same exclusion percentage to his or her initial payment called for in the contract. Income tax form 1040ez Step 5. Income tax form 1040ez   Multiply the tax-free part of each payment (step 4) by the number of payments received during the year. Income tax form 1040ez This will give you the tax-free part of the total payment for the year. Income tax form 1040ez    In the first year of your annuity, your first payment or part of your first payment may be for a fraction of the payment period. Income tax form 1040ez This fractional amount is multiplied by your exclusion percentage to get the tax-free part. Income tax form 1040ez Step 6. Income tax form 1040ez   Subtract the tax-free part from the total payment you received. Income tax form 1040ez The rest is the taxable part of your pension or annuity. Income tax form 1040ez Example 1. Income tax form 1040ez You purchased an annuity with an investment in the contract of $10,800. Income tax form 1040ez Under its terms, the annuity will pay you $100 a month for life. Income tax form 1040ez The multiple for your age (age 65) is 20. Income tax form 1040ez 0 as shown in Table V. Income tax form 1040ez Your expected return is $24,000 (20 × 12 × $100). Income tax form 1040ez Your cost of $10,800, divided by your expected return of $24,000, equals 45. Income tax form 1040ez 0%. Income tax form 1040ez This is the percentage you will not have to include in income. Income tax form 1040ez Each year, until your net cost is recovered, $540 (45% of $1,200) will be tax free and you will include $660 ($1,200 − $540) in your income. Income tax form 1040ez If you had received only six payments of $100 ($600) during the year, your exclusion would have been $270 (45% of $100 × 6 payments). Income tax form 1040ez Example 2. Income tax form 1040ez Gerald bought a joint and survivor annuity. Income tax form 1040ez Gerald's investment in the contract is $62,712 and the expected return is $121,200. Income tax form 1040ez The exclusion percentage is 51. Income tax form 1040ez 7% ($62,712 ÷ $121,200). Income tax form 1040ez Gerald will receive $500 a month ($6,000 a year). Income tax form 1040ez Each year, until his net cost is recovered, $3,102 (51. Income tax form 1040ez 7% of his total payments received of $6,000) will be tax free and $2,898 ($6,000 − $3,102) will be included in his income. Income tax form 1040ez If Gerald dies, his wife will receive $350 a month ($4,200 a year). Income tax form 1040ez If Gerald had not recovered all of his net cost before his death, his wife will use the same exclusion percentage (51. Income tax form 1040ez 7%). Income tax form 1040ez Each year, until the entire net cost is recovered, his wife will receive $2,171. Income tax form 1040ez 40 (51. Income tax form 1040ez 7% of her payments received of $4,200) tax free. Income tax form 1040ez She will include $2,028. Income tax form 1040ez 60 ($4,200 − $2,171. Income tax form 1040ez 40) in her income tax return. Income tax form 1040ez Example 3. Income tax form 1040ez Using the same facts as Example 2 under Different payments to survivor, you are to receive an annual annuity of $4,800 until you die or remarry. Income tax form 1040ez Your two daughters each receive annual annuities of $1,800 until they reach age 18. Income tax form 1040ez Your husband contributed $25,576 to the plan. Income tax form 1040ez You are eligible for the $5,000 death benefit exclusion because your husband died before August 21, 1996. Income tax form 1040ez Adjusted Investment in the Contract Contributions $25,576 Plus: Death benefit exclusion 5,000 Adjusted investment in the contract $30,576 The total expected return, as previously figured (in Example 2 under Different payments to survivor), is $169,680. Income tax form 1040ez The exclusion percentage of 18. Income tax form 1040ez 0% ($30,576 ÷ $169,680) applies to the annuity payments you and each of your daughters receive. Income tax form 1040ez Each full year $864 (18. Income tax form 1040ez 0% × $4,800) will be tax free to you, and you must include $3,936 in your income tax return. Income tax form 1040ez Each year, until age 18, $324 (18. Income tax form 1040ez 0% × $1,800) of each of your daughters' payments will be tax free and each must include the balance, $1,476, as income on her own income tax return. Income tax form 1040ez Part-year payments. Income tax form 1040ez   If you receive payments for only part of a year, apply the exclusion percentage to the first regular periodic payment, and multiply the result by the number of payments received during the year. Income tax form 1040ez   If you receive amounts during the year that represent 12 payments, one for each month in that year, and an amount that represents payments for months in a prior year, apply the exclusion percentage to the first regular periodic payment, and multiply the result by the number of payments the amounts received represent. Income tax form 1040ez For instance, if you received amounts during the year that represent the 12 payments for that year plus an amount that represents three payments for a prior year, multiply that amount by the 15 (12 + 3) payments received that the year. Income tax form 1040ez   If you received a fractional payment, follow Step 5, discussed earlier. Income tax form 1040ez This gives you the tax-free part of your total payment. Income tax form 1040ez Example. Income tax form 1040ez On September 28, Mary bought an annuity contract for $22,050 that will give her $125 a month for life, beginning October 30. Income tax form 1040ez The applicable multiple from Table V is 23. Income tax form 1040ez 3 (age 61). Income tax form 1040ez Her expected return is $34,950 ($125 × 12 × 23. Income tax form 1040ez 3). Income tax form 1040ez Mary's investment in the contract of $22,050, divided by her expected return of $34,950, equals 63. Income tax form 1040ez 1%. Income tax form 1040ez Each payment received will consist of 63. Income tax form 1040ez 1% return of cost and 36. Income tax form 1040ez 9% taxable income, until her net cost of the contract is fully recovered. Income tax form 1040ez During the first year, Mary received three payments of $125, or $375, of which $236. Income tax form 1040ez 63 (63. Income tax form 1040ez 1% × $375) is a return of cost. Income tax form 1040ez The remaining $138. Income tax form 1040ez 37 is included in income. Income tax form 1040ez Increase in annuity payments. Income tax form 1040ez   The tax-free amount remains the same as the amount figured at the annuity starting date, even if the payment increases. Income tax form 1040ez All increases in the installment payments are fully taxable. Income tax form 1040ez   However, if your annuity payments are scheduled to increase at a definite date in the future you must figure the expected return for that annuity using the method described in section 1. Income tax form 1040ez 72-5(a)(5) of the regulations. Income tax form 1040ez Example. Income tax form 1040ez Joe's wife died while she was still employed and, as her beneficiary, he began receiving an annuity of $147 per month. Income tax form 1040ez In figuring the taxable part, Joe elects to use Tables V through VIII. Income tax form 1040ez The cost of the contract was $7,938, consisting of the sum of his wife's net contributions, adjusted for any refund feature. Income tax form 1040ez His expected return as of the annuity starting date is $35,280 (age 65, multiple of 20. Income tax form 1040ez 0 × $1,764 annual payment). Income tax form 1040ez The exclusion percentage is $7,938 ÷ $35,280, or 22. Income tax form 1040ez 5%. Income tax form 1040ez During the year he received 11 monthly payments of $147, or $1,617. Income tax form 1040ez Of this amount, 22. Income tax form 1040ez 5% × $147 × 11 ($363. Income tax form 1040ez 83) is tax free as a return of cost and the balance of $1,253. Income tax form 1040ez 17 is taxable. Income tax form 1040ez Later, because of a cost-of-living increase, his annuity payment was increased to $166 per month, or $1,992 a year (12 × $166). Income tax form 1040ez The tax-free part is still only 22. Income tax form 1040ez 5% of the annuity payments as of the annuity starting date (22. Income tax form 1040ez 5% × $147 × 12 = $396. Income tax form 1040ez 90 for a full year). Income tax form 1040ez The increase of $228 ($1,992 − $1,764 (12 × $147)) is fully taxable. Income tax form 1040ez Variable annuities. Income tax form 1040ez   For variable annuity payments, figure the amount of each payment that is tax free by dividing your investment in the contract (adjusted for any refund feature) by the total number of periodic payments you expect to get under the contract. Income tax form 1040ez   If the annuity is for a definite period, you determine the total number of payments by multiplying the number of payments to be made each year by the number of years you will receive payments. Income tax form 1040ez If the annuity is for life, you determine the total number of payments by using a multiple from the appropriate actuarial table. Income tax form 1040ez Example. Income tax form 1040ez Frank purchased a variable annuity at age 65. Income tax form 1040ez The total cost of the contract was $12,000. Income tax form 1040ez The annuity starting date is January 1 of the year of purchase. Income tax form 1040ez His annuity will be paid, starting July 1, in variable annual installments for his life. Income tax form 1040ez The tax-free amount of each payment, until he has recovered his cost of his contract, is: Investment in the contract $12,000 Number of expected annual payments (multiple for age 65 from Table V) 20 Tax-free amount of each payment ($12,000 ÷ 20) $600 If Frank's first payment is $920, he includes only $320 ($920 − $600) in his gross income. Income tax form 1040ez   If the tax-free amount for a year is more than the payments you receive in that year, you may choose, when you receive the next payment, to refigure the tax-free part. Income tax form 1040ez Divide the amount of the periodic tax-free part that is more than the payment you received by the remaining number of payments you expect. Income tax form 1040ez The result is added to the previously figured periodic tax-free part. Income tax form 1040ez The sum is the amount of each future payment that will be tax free. Income tax form 1040ez Example. Income tax form 1040ez Using the facts of the previous example about Frank, assume that after Frank's $920 payment, he received $500 in the following year, and $1,200 in the year after that. Income tax form 1040ez Frank does not pay tax on the $500 (second year) payment because $600 of each annual pension payment is tax free. Income tax form 1040ez Since the $500 payment is less than the $600 annual tax-free amount, he may choose to refigure his tax-free part when he receives his $1,200 (third year) payment, as follows: Amount tax free in second year $600. Income tax form 1040ez 00 Amount received in second year 500. Income tax form 1040ez 00 Difference $100. Income tax form 1040ez 00 Number of remaining payments after the first 2 payments (age 67, from Table V) 18. Income tax form 1040ez 4 Amount to be added to previously determined annual tax-free part ($100 ÷ 18. Income tax form 1040ez 4) $5. Income tax form 1040ez 43 Revised annual tax-free part for third and later years ($600 + $5. Income tax form 1040ez 43) $605. Income tax form 1040ez 43 Amount taxable in third year ($1,200 − $605. Income tax form 1040ez 43) $594. Income tax form 1040ez 57 If you choose to refigure your tax-free amount,   you must file a statement with your income tax return stating that you are refiguring the tax-free amount in accordance with the rules of section 1. Income tax form 1040ez 72–4(d)(3) of the Income Tax Regulations. Income tax form 1040ez The statement must also show the following information: The annuity starting date and your age on that date. Income tax form 1040ez The first day of the first period for which you received an annuity payment in the current year. Income tax form 1040ez Your investment in the contract as originally figured. Income tax form 1040ez The total of all amounts received tax free under the annuity from the annuity starting date through the first day of the first period for which you received an annuity payment in the current tax year. Income tax form 1040ez Exclusion Limits Your annuity starting date determines the total amount of annuity income that you can exclude from income over the years. Income tax form 1040ez Exclusion limited to net cost. Income tax form 1040ez   If your annuity starting date is after 1986, the total amount of annuity income that you can exclude over the years as a return of your cost cannot exceed your net cost (figured without any reduction for a refund feature). Income tax form 1040ez This is the unrecovered investment in the contract as of the annuity starting date. Income tax form 1040ez   If your annuity starting date is after July 1, 1986, any unrecovered net cost at your (or last annuitant's) death is allowed as a miscellaneous itemized deduction on the final return of the decedent. Income tax form 1040ez This deduction is not subject to the 2%-of-adjusted-gross-income limit. Income tax form 1040ez Example 1. Income tax form 1040ez Your annuity starting date is after 1986. Income tax form 1040ez Your total cost is $12,500, and your net cost is $10,000, taking into account certain adjustments. Income tax form 1040ez There is no refund feature. Income tax form 1040ez Your monthly annuity payment is $833. Income tax form 1040ez 33. Income tax form 1040ez Your exclusion ratio is 12% and you exclude $100 a month. Income tax form 1040ez Your exclusion ends after 100 months, when you have excluded your net cost of $10,000. Income tax form 1040ez Thereafter, your annuity payments are fully taxable. Income tax form 1040ez Example 2. Income tax form 1040ez The facts are the same as in Example 1, except that there is a refund feature, and you die after 5 years with no surviving annuitant. Income tax form 1040ez The adjustment for the refund feature is $1,000, so the investment in the contract is $9,000. Income tax form 1040ez The exclusion ratio is 10. Income tax form 1040ez 8%, and your monthly exclusion is $90. Income tax form 1040ez After 5 years (60 months), you have recovered tax free only $5,400 ($90 x 60). Income tax form 1040ez An itemized deduction for the unrecovered net cost of $4,600 ($10,000 net cost minus $5,400) may be taken on your final income tax return. Income tax form 1040ez Your unrecovered investment is determined without regard to the refund feature adjustment, discussed earlier, under Adjustments. Income tax form 1040ez Exclusion not limited to net cost. Income tax form 1040ez   If your annuity starting date was before 1987, you could continue to take your monthly exclusion for as long as you receive your annuity. Income tax form 1040ez If you choose a joint and survivor annuity, your survivor continues to take the survivor's exclusion figured as of the annuity starting date. Income tax form 1040ez The total exclusion may be more than your investment in the contract. Income tax form 1040ez How To Use Actuarial Tables In figuring, under the General Rule, the taxable part of your annuity payments that you are to get for the rest of your life (rather than for a fixed number of years), you must use one or more of the actuarial tables in this publication. Income tax form 1040ez Unisex Annuity Tables Effective July 1, 1986, the Internal Revenue Service adopted new annuity Tables V through VIII, in which your sex is not considered when determining the applicable factor. Income tax form 1040ez These tables correspond to the old Tables I through IV. Income tax form 1040ez In general, Tables V through VIII must be used if you made contributions to the retirement plan after June 30, 1986. Income tax form 1040ez If you made no contributions to the plan after June 30, 1986, generally you must use only Tables I through IV. Income tax form 1040ez However, if you received an annuity payment after June 30, 1986, you may elect to use Tables V through VIII (see Annuity received after June 30, 1986, later). Income tax form 1040ez Special Elections Although you generally must use Tables V through VIII if you made contributions to the retirement plan after June 30, 1986, and Tables I through IV if you made no contributions after June 30, 1986, you can make the following special elections to select which tables to use. Income tax form 1040ez Contributions made both before July 1986 and after June 1986. Income tax form 1040ez   If you made contributions to the retirement plan both before July 1986 and after June 1986, you may elect to use Tables I through IV for the pre-July 1986 cost of the contract, and Tables V through VIII for the post-June 1986 cost. Income tax form 1040ez (See the examples below. Income tax form 1040ez )    Making the election. Income tax form 1040ez Attach this statement to your income tax return for the first year in which you receive an annuity:    “I elect to apply the provisions of paragraph (d) of section 1. Income tax form 1040ez 72–6 of the Income Tax Regulations. Income tax form 1040ez ”   The statement must also include your name, address, social security number, and the amount of the pre-July 1986 investment in the contract. Income tax form 1040ez   If your investment in the contract includes post-June 1986 contributions to the plan, and you do not make the election to use Tables I through IV and Tables V through VIII, then you can only use Tables V through VIII in figuring the taxable part of your annuity. Income tax form 1040ez You must also use Tables V through VIII if you are unable or do not wish to determine the portions of your contributions which were made before July 1, 1986, and after June 30, 1986. Income tax form 1040ez    Advantages of election. Income tax form 1040ez In general, a lesser amount of each annual annuity payment is taxable if you separately figure your exclusion ratio for pre-July 1986 and post-June 1986 contributions. Income tax form 1040ez    If you intend to make this election, save your records that substantiate your pre-July 1986 and post-June 1986 contributions. Income tax form 1040ez If the death benefit exclusion applies (see discussion, earlier), you do not have to apportion it between the pre-July 1986 and the post-June 1986 investment in the contract. Income tax form 1040ez   The following examples illustrate the separate computations required if you elect to use Tables I through IV for your pre-July 1986 investment in the contract and Tables V through VIII for your post-June 1986 investment in the contract. Income tax form 1040ez Example 1. Income tax form 1040ez Bill, who is single, contributed $42,000 to the retirement plan and will receive an annual annuity of $24,000 for life. Income tax form 1040ez Payment of the $42,000 contribution is guaranteed under a refund feature. Income tax form 1040ez Bill is 55 years old as of the annuity starting date. Income tax form 1040ez For figuring the taxable part of Bill's annuity, he chose to make separate computations for his pre-July 1986 investment in the contract of $41,300, and for his post-June 1986 investment in the contract of $700. Income tax form 1040ez       Pre- July 1986   Post- June 1986 A. Income tax form 1040ez Adjustment for refund feature         1) Net cost $41,300   $700   2) Annual annuity—$24,000  ($41,300/$42,000 × $24,000) $23,600       ($700/$42,000 × $24,000)     $400   3) Guarantee under contract $41,300   $700   4) No. Income tax form 1040ez of years payments  guaranteed (rounded), A(3) ÷ A(2) 2   2   5) Applicable percentage from  Tables III and VII 1%   0%   6) Adjustment for value of refund  feature, A(5) × smaller of A(1)  or A(3) $413   $0 B. Income tax form 1040ez Investment in the contract         1) Net cost $41,300   $700   2) Minus: Amount in A(6) 413   0   3) Investment in the contract $40,887   $700 C. Income tax form 1040ez Expected return         1) Annual annuity receivable $24,000   $24,000   2) Multiples from Tables I and V 21. Income tax form 1040ez 7   28. Income tax form 1040ez 6   3) Expected return, C(1) × C(2) $520,800   $686,400 D. Income tax form 1040ez Tax-free part of annuity         1) Exclusion ratio as decimal,  B(3) ÷ C(3) . Income tax form 1040ez 079   . Income tax form 1040ez 001   2) Tax-free part, C(1) × D(1) $1,896   $24 The tax-free part of Bill's total annuity is $1,920 ($1,896 plus $24). Income tax form 1040ez The taxable part of his annuity is $22,080 ($24,000 minus $1,920). Income tax form 1040ez If the annuity starting date is after 1986, the exclusion over the years cannot exceed the net cost (figured without any reduction for a refund feature). Income tax form 1040ez Example 2. Income tax form 1040ez Al is age 62 at his nearest birthday to the annuity starting date. Income tax form 1040ez Al's wife is age 60 at her nearest birthday to the annuity starting date. Income tax form 1040ez The joint and survivor annuity pays $1,000 per month to Al for life, and $500 per month to Al's surviving wife after his death. Income tax form 1040ez The pre-July 1986 investment in the contract is $53,100 and the post-June 1986 investment in the contract is $7,000. Income tax form 1040ez Al makes the election described in Example 1 . Income tax form 1040ez For purposes of this example, assume the refund feature adjustment is zero. Income tax form 1040ez If an adjustment is required, IRS will figure the amount. Income tax form 1040ez See Requesting a Ruling on Taxation of Annuity near the end of this publication. Income tax form 1040ez       Pre-  July 1986   Post-  June 1986 A. Income tax form 1040ez Adjustment for refund feature         1) Net cost $53,100   $7,000   2) Annual annuity—$12,000  ($53,100/$60,100 × $12,000) $10,602       ($7,000/$60,100 × $12,000)     $1,398   3) Guaranteed under the contract $53,100   $7,000   4) Number of years guaranteed,  rounded, A(3) ÷ A(2) 5   5   5) Applicable percentages 0%   0%   6) Refund feature adjustment, A(5) × smaller of A(1) or A(3) 0   0 B. Income tax form 1040ez Investment in the contract         1) Net cost $53,100   $7,000   2) Refund feature adjustment 0   0   3) Investment in the contract adjusted for refund feature $53,100   $7,000 C. Income tax form 1040ez Expected return         1) Multiple for both annuitants from Tables II and VI 25. Income tax form 1040ez 4   28. Income tax form 1040ez 8   2) Multiple for first annuitant from Tables I and V 16. Income tax form 1040ez 9   22. Income tax form 1040ez 5   3) Multiple applicable to surviving annuitant, subtract C(2) from C(1) 8. Income tax form 1040ez 5   6. Income tax form 1040ez 3   4) Annual annuity to surviving annuitant $6,000   $6,000   5) Portion of expected return for surviving annuitant, C(4) × C(3) $51,000   $37,800   6) Annual annuity to first annuitant $12,000   $12,000   7) Plus: Portion of expected return for first annuitant, C(6) × C(2) $202,800   $270,000   8) Expected return for both annuitants, C(5) + C(7) $253,800   $307,800 D. Income tax form 1040ez Tax-free part of annuity         1) Exclusion ratio as a decimal, B(3) ÷ C(8) . Income tax form 1040ez 209   . Income tax form 1040ez 023   2) Retiree's tax-free part of annuity, C(6) × D(1) $2,508   $276   3) Survivor's tax-free part of annuity, C(4) × D(1) $1,254   $138 The tax-free part of Al's total annuity is $2,784 ($2,508 + $276). Income tax form 1040ez The taxable part of his annuity is $9,216 ($12,000 − $2,784). Income tax form 1040ez The exclusion over the years cannot exceed the net cost of the contract (figured without any reduction for a refund feature) if the annuity starting date is after 1986. Income tax form 1040ez After Al's death, his widow will apply the same exclusion percentages (20. Income tax form 1040ez 9% and 2. Income tax form 1040ez 3%) to her annual annuity of $6,000 to figure the tax-free part of her annuity. Income tax form 1040ez Annuity received after June 30, 1986. Income tax form 1040ez   If you receive an annuity payment after June 30, 1986, (regardless of your annuity starting date), you may elect to treat the entire cost of the contract as post-June 1986 cost (even if you made no post-June 1986 contributions to the plan) and use Tables V through VIII. Income tax form 1040ez Once made, you cannot revoke the election, which will apply to all payments during the year and in any later year. Income tax form 1040ez    Make the election by attaching the following statement to your income tax return. Income tax form 1040ez    “I elect, under section 1. Income tax form 1040ez 72–9 of the Income Tax Regulations, to treat my entire cost of the contract as a post-June 1986 cost of the plan. Income tax form 1040ez ”   The statement must also include your name, address, and social security number. Income tax form 1040ez   You should also indicate you are making this election if you are unable or do not wish to determine the parts of your contributions which were made before July 1, 1986, and after June 30, 1986. Income tax form 1040ez Disqualifying form of payment or settlement. Income tax form 1040ez   If your annuity starting date is after June 30, 1986, and the contract provides for a disqualifying form of payment or settlement, such as an option to receive a lump sum in full discharge of the obligation under the contract, the entire investment in the contract is treated as post-June 1986 investment in the contract. Income tax form 1040ez See regulations section 1. Income tax form 1040ez 72–6(d)(3) for additional examples of disqualifying forms of payment or settlement. Income tax form 1040ez You can find the Income Tax Regulations in many libraries and at Internal Revenue Service Offices. Income tax form 1040ez Worksheets for Determining Taxable Annuity Worksheets I and II. Income tax form 1040ez   Worksheets I and II follow for determining your taxable annuity under Regulations Section 1. Income tax form 1040ez 72–6(d)(6) Election. Income tax form 1040ez Worksheet I For Determining Taxable Annuity Under Regulations Section 1. Income tax form 1040ez 72-6(d)(6) Election For Single Annuitant With No Survivor Annuity               Pre-July 1986   Post-June 1986 A. Income tax form 1040ez   Refund Feature Adjustment             1)   Net cost (total cost less returned premiums, dividends, etc. Income tax form 1040ez )             2)   Annual annuity allocation:                   Portion of net cost in A(1) x annual annuity                   Net cost             3)   Guaranteed under the contract             4)   Number of years guaranteed, rounded to whole years:                   A(3) divided by A(2)             5)   Applicable percentages* from Tables III and VII                   *If your annuity meets the three conditions listed in Zero value of refund feature in Investment in the Contract, earlier, both percentages are 0. Income tax form 1040ez If not, the IRS will calculate the refund feature percentage. Income tax form 1040ez             6)   Refund feature adjustment:                   A(5) times lesser of A(1) or A(3)                             B. Income tax form 1040ez   Investment in the Contract             1)   Net cost:                   A(1)             2)   Refund feature adjustment:                   A(6)             3)   Investment in the contract adjusted for refund feature:                   B(1) minus B(2)                             C. Income tax form 1040ez   Expected Return             1)   Annual Annuity:                   12 times monthly annuity**             2)   Expected return multiples from Tables I and V             3)     Expected return:                   C(1) times C(2)                             D. Income tax form 1040ez   Tax-Free Part of Annuity             1)     Exclusion ratio, as a decimal rounded to 3 places:                   B(3) divided by C(3)             2)     Tax-free part of annuity:                   C(1) times D(1)             **If the annuity is not paid monthly, figure the amount to enter by using the total number of periodic payments for the year times the amount of the periodic payment. Income tax form 1040ez     Worksheet II For Determining Taxable Annuity Under Regulations Section 1. Income tax form 1040ez 72-6(d)(6) Election For Joint and Survivor Annuity               Pre-July 1986   Post-June 1986 A. Income tax form 1040ez   Refund Feature Adjustment             1)   Net cost (total cost less returned premiums, dividends, etc. Income tax form 1040ez )             2)   Annual annuity allocation:                   Portion of net cost in A(1) x annual annuity                   Net cost             3)   Guaranteed under the contract             4)     Number of years guaranteed, rounded to whole years:                   A(3) divided by A(2)             5)   Applicable percentages*                   *If your annuity meets the three conditions listed in Zero value of refund feature in Investment in the Contract, earlier, both percentages are 0. Income tax form 1040ez If not, the IRS will calculate the refund feature percentage. Income tax form 1040ez             6)   Refund feature adjustment:                   A(5) times lesser of A(1) or A(3)                             B. Income tax form 1040ez   Investment in the Contract             1)   Net cost:                   A(1)             2)   Refund feature adjustment:                   A(6)             3)   Investment in the contract adjusted for refund future:                   B(1) minus B(2)                             C. Income tax form 1040ez   Expected Return             1)   Multiples for both annuitants, Tables II and VI             2)   Multiple for retiree. Income tax form 1040ez Tables I and VI             3)   Multiple for survivor:                   C(1) minus C(2)             4)   Annual annuity to survivor:                   12 times potential monthly rate for survivor**             5)   Expected return for survivor:                   C(3) times C(4)             6)   Annual annuity to retiree:                   12 times monthly rate for retiree**             7)   Expected return for retiree:                   C(2) times C(6)             8)   Total expected return:                   C(5) plus C(7)                             D. Income tax form 1040ez   Tax-Free Part of Annuity             1)   Exclusion ratio, as a decimal rounded to 3 places:                   B(3) divided by C(8)             2)   Retiree's tax-free part of annuity:                   C(6) times D(1)             3)   Survivor's tax-free part of annuity, if surviving after death of retiree:                   C(4) times D(1)             **If the annuity is not paid monthly, figure the amount to enter by using the total number of periodic payments for the year times the amount of the periodic payment. Income tax form 1040ez   Actuarial Tables Please click here for the text description of the image. Income tax form 1040ez Actuarial Tables Please click here for the text description of the image. Income tax form 1040ez Actuarial Tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Please click here for the text description of the image. Income tax form 1040ez Actuarial tables Requesting a Ruling on Taxation of Annuity If you are a retiree, or the survivor of an employee or retiree, you may ask the Internal Revenue Service to help you determine the taxation of your annuity. Income tax form 1040ez If you make this request, you are asking for a ruling. Income tax form 1040ez User fee. Income tax form 1040ez   Under the law in effect at the time this publication went to print, the IRS must charge a user fee for all ruling requests. Income tax form 1040ez You should call the IRS for the proper fee. Income tax form 1040ez A request solely for the value of the refund feature is not treated as a ruling request and requires no fee. Income tax form 1040ez Send your request to:     Internal Revenue Service  Attention: EP Letter Rulings P. Income tax form 1040ez O. Income tax form 1040ez Box 27063 McPherson Station Washington, DC 20038 The user fee is allowed as a miscellaneous itemized deduction, subject to the 2%-of-adjusted-gross-income limit. Income tax form 1040ez When to make the request. Income tax form 1040ez   Please note that requests sent between February 1 and April 15 may experience some delay. Income tax form 1040ez We process requests in the order received, and we will reply to your request as soon as we can process it. Income tax form 1040ez If you do not receive your ruling by the required filing date, you may use Form 4868, Application for Automatic Extension of Time To File U. Income tax form 1040ez S. Income tax form 1040ez Individual Income Tax Return, to get an extension of time to file. Income tax form 1040ez Information you must furnish. Income tax form 1040ez   You must furnish the information listed below so the IRS can comply with your request. Income tax form 1040ez Failure to furnish the information will result in a delay in processing your request. Income tax form 1040ez Please send only copies of the following documents, as the IRS retains all material sent for its records: A letter explaining the question(s) you wish to have resolved or the information you need from the ruling. Income tax form 1040ez Copies of any documents showing distributions, annuity rates, and annuity options available to you. Income tax form 1040ez A copy of any Form 1099–R you received since your annuity began. Income tax form 1040ez A statement indicating whether you have filed your return for the year for which you are making the request. Income tax form 1040ez If you have requested an extension of time to file that return, please indicate the extension date. Income tax form 1040ez Your daytime phone number. Income tax form 1040ez Your current mailing address. Income tax form 1040ez A power of attorney if someone other than you, an attorney, a certified public accountant, or an enrolled agent is signing this request. Income tax form 1040ez Form 2848, Power of Attorney and Declaration of Representative, may be used for this purpose. Income tax form 1040ez A completed Tax Information Sheet (or facsimile) shown on the next page. Income tax form 1040ez Sign and date the Disclosure and Perjury Statement (or facsimile) at the end of the tax information sheet. Income tax form 1040ez This statement must be signed by the retiree or the survivor annuitant. Income tax form 1040ez It cannot be signed by a representative. Income tax form 1040ez Tax Information Sheet Please click here for the text description of the image. Income tax form 1040ez Tax Information Sheet Please click here for the text description of the image. Income tax form 1040ez Tax Information Sheet (continued) How To Get Tax Help Whether it's help with a tax issue, preparing your tax return or a need for a free publication or form, get the help you need the way you want it: online, use a smart phone, call or walk in to an IRS office or volunteer site near you. Income tax form 1040ez Free help with your tax return. Income tax form 1040ez   You can get free help preparing your return nationwide from IRS-certified volunteers. Income tax form 1040ez The Volunteer Income Tax Assistance (VITA) program helps low-to-moderate income, elderly, people with disabilities, and limited English proficient taxpayers. Income tax form 1040ez The Tax Counseling for the Elderly (TCE) program helps taxpayers age 60 and older with their tax returns. Income tax form 1040ez Most VITA and TCE sites offer free electronic filing and all volunteers will let you know about credits and deductions you may be entitled to claim. Income tax form 1040ez In addition, some VITA and TCE sites provide taxpayers the opportunity to prepare their own return with help from an IRS-certified volunteer. Income tax form 1040ez To find the nearest VITA or TCE site, you can use the VITA Locator Tool on IRS. Income tax form 1040ez gov, download the IRS2Go app, or call 1-800-906-9887. Income tax form 1040ez   As part of the TCE program, AARP offers the Tax-Aide counseling program. Income tax form 1040ez To find the nearest AARP Tax-Aide site, visit AARP's website at www. Income tax form 1040ez aarp. Income tax form 1040ez org/money/taxaide or call 1-888-227-7669. Income tax form 1040ez For more information on these programs, go to IRS. Income tax form 1040ez gov and enter “VITA” in the search box. Income tax form 1040ez Internet. Income tax form 1040ez    IRS. Income tax form 1040ez gov and IRS2Go are ready when you are —24 hours a day, 7 days a week. Income tax form 1040ez Download the free IRS2Go app from the iTunes app store or from Google Play. Income tax form 1040ez Use it to check your refund status, order transcripts of your tax returns or tax account, watch the IRS YouTube channel, get IRS news as soon as it's released to the public, subscribe to filing season updates or daily tax tips, and follow the IRS Twitter news feed, @IRSnews, to get the latest federal tax news, including information about tax law changes and important IRS programs. Income tax form 1040ez Check the status of your 2013 refund with the Where's My Refund? application on IRS. Income tax form 1040ez gov or download the IRS2Go app and select the Refund Status option. Income tax form 1040ez The IRS issues more than 9 out of 10 refunds in less than 21 days. Income tax form 1040ez Using these applications, you can start checking on the status of your return within 24 hours after we receive your e-filed return or 4 weeks after you mail a paper return. Income tax form 1040ez You will also be given a personalized refund date as soon as the IRS processes your tax return and approves your refund. Income tax form 1040ez The IRS updates Where's My Refund? every 24 hours, usually overnight, so you only need to check once a day. Income tax form 1040ez Use the Interactive Tax Assistant (ITA) to research your tax questions. Income tax form 1040ez No need to wait on the phone or stand in line. Income tax form 1040ez The ITA is available 24 hours a day, 7 days a week, and provides you with a variety of tax information related to general filing topics, deductions, credits, and income. Income tax form 1040ez When you reach the response screen, you can print the entire interview and the final response for your records. Income tax form 1040ez New subject areas are added on a regular basis. Income tax form 1040ez  Answers not provided through ITA may be found in Tax Trails, one of the Tax Topics on IRS. Income tax form 1040ez gov which contain general individual and business tax information or by searching the IRS Tax Map, which includes an international subject index. Income tax form 1040ez You can use the IRS Tax Map, to search publications and instructions by topic or keyword. Income tax form 1040ez The IRS Tax Map integrates forms and publications into one research tool and provides single-point access to tax law information by subject. Income tax form 1040ez When the user searches the IRS Tax Map, they will be provided with links to related content in existing IRS publications, forms and instructions, questions and answers, and Tax Topics. Income tax form 1040ez Coming this filing season, you can immediately view and print for free all 5 types of individual federal tax transcripts (tax returns, tax account, record of account, wage and income statement, and certification of non-filing) using Get Transcript. Income tax form 1040ez You can also ask the IRS to mail a return or an account transcript to you. Income tax form 1040ez Only the mail option is available by choosing the Tax Records option on the IRS2Go app by selecting Mail Transcript on IRS. Income tax form 1040ez gov or by calling 1-800-908-9946. Income tax form 1040ez Tax return and tax account transcripts are generally available for the current year and the past three years. Income tax form 1040ez Determine if you are eligible for the EITC and estimate the amount of the credit with the Earned Income Tax Credit (EITC) Assistant. Income tax form 1040ez Visit Understanding Your IRS Notice or Letter to get answers to questions about a notice or letter you received from the IRS. Income tax form 1040ez If you received the First Time Homebuyer Credit, you can use the First Time Homebuyer Credit Account Look-up tool for information on your repayments and account balance. Income tax form 1040ez Check the status of your amended return using Where's My Amended Return? Go to IRS. Income tax form 1040ez gov and enter Where's My Amended Return? in the search box. Income tax form 1040ez You can generally expect your amended return to be processed up to 12 weeks from the date we receive it. Income tax form 1040ez It can take up to 3 weeks from the date you mailed it to show up in our system. Income tax form 1040ez Make a payment using one of several safe and convenient electronic payment options available on IRS. Income tax form 1040ez gov. Income tax form 1040ez Select the Payment tab on the front page of IRS. Income tax form 1040ez gov for more information. Income tax form 1040ez Determine if you are eligible and apply for an online payment agreement, if you owe more tax than you can pay today. Income tax form 1040ez Figure your income tax withholding with the IRS Withholding Calculator on IRS. Income tax form 1040ez gov. Income tax form 1040ez Use it if you've had too much or too little withheld, your personal situation has changed, you're starting a new job or you just want to see if you're having the right amount withheld. Income tax form 1040ez Determine if you might be subject to the Alternative Minimum Tax by using the Alternative Minimum Tax Assistant on IRS. Income tax form 1040ez gov. Income tax form 1040ez Request an Electronic Filing PIN by going to IRS. Income tax form 1040ez gov and entering Electronic Filing PIN in the search box. Income tax form 1040ez Download forms, instructions and publications, including accessible versions for people with disabilities. Income tax form 1040ez Locate the nearest Taxpayer Assistance Center (TAC) using the Office Locator tool on IRS. Income tax form 1040ez gov, or choose the Contact Us option on the IRS2Go app and search Local Offices. Income tax form 1040ez An employee can answer questions about your tax account or help you set up a payment plan. Income tax form 1040ez Before you visit, check the Office Locator on IRS. Income tax form 1040ez gov, or Local Offices under Contact Us on IRS2Go to confirm the address, phone number, days and hours of operation, and the services provided. Income tax form 1040ez If you have a special need, such as a disability, you can request an appointment. Income tax form 1040ez Call the local number listed in the Office Locator, or look in the phone book under United States Government, Internal Revenue Service. Income tax form 1040ez Apply for an Employer Identification Number (EIN). Income tax form 1040ez Go to IRS. Income tax form 1040ez gov and enter Apply for an EIN in the search box. Income tax form 1040ez Read the Internal Revenue Code, regulations, or other official guidance. Income tax form 1040ez Read Internal Revenue Bulletins. Income tax form 1040ez Sign up to receive local and national tax news and more by email. Income tax form 1040ez Just click on “subscriptions” above the search box on IRS. Income tax form 1040ez gov and choose from a variety of options. Income tax form 1040ez    Phone. Income tax form 1040ez You can call the IRS, or you can carry it in your pocket with the IRS2Go app on your smart phone or tablet. Income tax form 1040ez Download the free IRS2Go app from the iTunes app store or from Google Play. Income tax form 1040ez Call to locate the nearest volunteer help site, 1-800-906-9887 or you can use the VITA Locator Tool on IRS. Income tax form 1040ez gov, or download the IRS2Go app. Income tax form 1040ez Low-to-moderate income, elderly, people with disabilities, and limited English proficient taxpayers can get free help with their tax return from the nationwide Volunteer Income Tax Assistance (VITA) program. Income tax form 1040ez The Tax Counseling for the Elderly (TCE) program helps taxpayers age 60 and older with their tax returns. Income tax form 1040ez Mos