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Irs 1040ez Form Online

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Irs 1040ez Form Online

Irs 1040ez form online 2. Irs 1040ez form online   Depreciation of Rental Property Table of Contents The BasicsWhat Rental Property Can Be Depreciated? When Does Depreciation Begin and End? Depreciation Methods Basis of Depreciable Property Claiming the Special Depreciation Allowance MACRS DepreciationDepreciation Systems Property Classes Under GDS Recovery Periods Under GDS Conventions Figuring Your Depreciation Deduction Figuring MACRS Depreciation Under ADS Claiming the Correct Amount of Depreciation You recover the cost of income producing property through yearly tax deductions. Irs 1040ez form online You do this by depreciating the property; that is, by deducting some of the cost each year on your tax return. Irs 1040ez form online Three factors determine how much depreciation you can deduct each year: (1) your basis in the property, (2) the recovery period for the property, and (3) the depreciation method used. Irs 1040ez form online You cannot simply deduct your mortgage or principal payments, or the cost of furniture, fixtures and equipment, as an expense. Irs 1040ez form online You can deduct depreciation only on the part of your property used for rental purposes. Irs 1040ez form online Depreciation reduces your basis for figuring gain or loss on a later sale or exchange. Irs 1040ez form online You may have to use Form 4562 to figure and report your depreciation. Irs 1040ez form online See Which Forms To Use in chapter 3. Irs 1040ez form online Also see Publication 946. Irs 1040ez form online Section 179 deduction. Irs 1040ez form online   The section 179 deduction is a means of recovering part or all of the cost of certain qualifying property in the year you place the property in service. Irs 1040ez form online This deduction is not allowed for property used in connection with residential rental property. Irs 1040ez form online See chapter 2 of Publication 946. Irs 1040ez form online Alternative minimum tax (AMT). Irs 1040ez form online   If you use accelerated depreciation, you may be subject to the AMT. Irs 1040ez form online Accelerated depreciation allows you to deduct more depreciation earlier in the recovery period than you could deduct using a straight line method (same deduction each year). Irs 1040ez form online   The prescribed depreciation methods for rental real estate are not accelerated, so the depreciation deduction is not adjusted for the AMT. Irs 1040ez form online However, accelerated methods are generally used for other property connected with rental activities (for example, appliances and wall-to-wall carpeting). Irs 1040ez form online   To find out if you are subject to the AMT, see the Instructions for Form 6251. Irs 1040ez form online The Basics The following section discusses the information you will need to have about the rental property and the decisions to be made before figuring your depreciation deduction. Irs 1040ez form online What Rental Property Can Be Depreciated? You can depreciate your property if it meets all the following requirements. Irs 1040ez form online You own the property. Irs 1040ez form online You use the property in your business or income-producing activity (such as rental property). Irs 1040ez form online The property has a determinable useful life. Irs 1040ez form online The property is expected to last more than one year. Irs 1040ez form online Property you own. Irs 1040ez form online   To claim depreciation, you usually must be the owner of the property. Irs 1040ez form online You are considered as owning property even if it is subject to a debt. Irs 1040ez form online Rented property. Irs 1040ez form online   Generally, if you pay rent for property, you cannot depreciate that property. Irs 1040ez form online Usually, only the owner can depreciate it. Irs 1040ez form online However, if you make permanent improvements to leased property, you may be able to depreciate the improvements. Irs 1040ez form online See Additions or improvements to property , later in this chapter, under Recovery Periods Under GDS. Irs 1040ez form online Cooperative apartments. Irs 1040ez form online   If you are a tenant-stockholder in a cooperative housing corporation and rent your cooperative apartment to others, you can deduct depreciation on your stock in the corporation. Irs 1040ez form online See chapter 4, Special Situations. Irs 1040ez form online Property having a determinable useful life. Irs 1040ez form online   To be depreciable, your property must have a determinable useful life. Irs 1040ez form online This means that it must be something that wears out, decays, gets used up, becomes obsolete, or loses its value from natural causes. Irs 1040ez form online What Rental Property Cannot Be Depreciated? Certain property cannot be depreciated. Irs 1040ez form online This includes land and certain excepted property. Irs 1040ez form online Land. Irs 1040ez form online   You cannot depreciate the cost of land because land generally does not wear out, become obsolete, or get used up. Irs 1040ez form online But if it does, the loss is accounted for upon disposition. Irs 1040ez form online The costs of clearing, grading, planting, and landscaping are usually all part of the cost of land and cannot be depreciated. Irs 1040ez form online   Although you cannot depreciate land, you can depreciate certain land preparation costs, such as landscaping costs, incurred in preparing land for business use. Irs 1040ez form online These costs must be so closely associated with other depreciable property that you can determine a life for them along with the life of the associated property. Irs 1040ez form online Example. Irs 1040ez form online You built a new house to use as a rental and paid for grading, clearing, seeding, and planting bushes and trees. Irs 1040ez form online Some of the bushes and trees were planted right next to the house, while others were planted around the outer border of the lot. Irs 1040ez form online If you replace the house, you would have to destroy the bushes and trees right next to it. Irs 1040ez form online These bushes and trees are closely associated with the house, so they have a determinable useful life. Irs 1040ez form online Therefore, you can depreciate them. Irs 1040ez form online Add your other land preparation costs to the basis of your land because they have no determinable life and you cannot depreciate them. Irs 1040ez form online Excepted property. Irs 1040ez form online   Even if the property meets all the requirements listed earlier under What Rental Property Can Be Depreciated , you cannot depreciate the following property. Irs 1040ez form online Property placed in service and disposed of (or taken out of business use) in the same year. Irs 1040ez form online Equipment used to build capital improvements. Irs 1040ez form online You must add otherwise allowable depreciation on the equipment during the period of construction to the basis of your improvements. Irs 1040ez form online For more information, see chapter 1 of Publication 946. Irs 1040ez form online When Does Depreciation Begin and End? You begin to depreciate your rental property when you place it in service for the production of income. Irs 1040ez form online You stop depreciating it either when you have fully recovered your cost or other basis, or when you retire it from service, whichever happens first. Irs 1040ez form online Placed in Service You place property in service in a rental activity when it is ready and available for a specific use in that activity. Irs 1040ez form online Even if you are not using the property, it is in service when it is ready and available for its specific use. Irs 1040ez form online Example 1. Irs 1040ez form online On November 22 of last year, you purchased a dishwasher for your rental property. Irs 1040ez form online The appliance was delivered on December 7, but was not installed and ready for use until January 3 of this year. Irs 1040ez form online Because the dishwasher was not ready for use last year, it is not considered placed in service until this year. Irs 1040ez form online If the appliance had been installed and ready for use when it was delivered in December of last year, it would have been considered placed in service in December, even if it was not actually used until this year. Irs 1040ez form online Example 2. Irs 1040ez form online On April 6, you purchased a house to use as residential rental property. Irs 1040ez form online You made extensive repairs to the house and had it ready for rent on July 5. Irs 1040ez form online You began to advertise the house for rent in July and actually rented it beginning September 1. Irs 1040ez form online The house is considered placed in service in July when it was ready and available for rent. Irs 1040ez form online You can begin to depreciate the house in July. Irs 1040ez form online Example 3. Irs 1040ez form online You moved from your home in July. Irs 1040ez form online During August and September you made several repairs to the house. Irs 1040ez form online On October 1, you listed the property for rent with a real estate company, which rented it on December 1. Irs 1040ez form online The property is considered placed in service on October 1, the date when it was available for rent. Irs 1040ez form online Conversion to business use. Irs 1040ez form online   If you place property in service in a personal activity, you cannot claim depreciation. Irs 1040ez form online However, if you change the property's use to business or the production of income, you can begin to depreciate it at the time of the change. Irs 1040ez form online You place the property in service for business or income-producing use on the date of the change. Irs 1040ez form online Example. Irs 1040ez form online You bought a house and used it as your personal home several years before you converted it to rental property. Irs 1040ez form online Although its specific use was personal and no depreciation was allowable, you placed the home in service when you began using it as your home. Irs 1040ez form online You can begin to claim depreciation in the year you converted it to rental property because at that time its use changed to the production of income. Irs 1040ez form online Idle Property Continue to claim a deduction for depreciation on property used in your rental activity even if it is temporarily idle (not in use). Irs 1040ez form online For example, if you must make repairs after a tenant moves out, you still depreciate the rental property during the time it is not available for rent. Irs 1040ez form online Cost or Other Basis Fully Recovered You must stop depreciating property when the total of your yearly depreciation deductions equals your cost or other basis of your property. Irs 1040ez form online For this purpose, your yearly depreciation deductions include any depreciation that you were allowed to claim, even if you did not claim it. Irs 1040ez form online See Basis of Depreciable Property , later. Irs 1040ez form online Retired From Service You stop depreciating property when you retire it from service, even if you have not fully recovered its cost or other basis. Irs 1040ez form online You retire property from service when you permanently withdraw it from use in a trade or business or from use in the production of income because of any of the following events. Irs 1040ez form online You sell or exchange the property. Irs 1040ez form online You convert the property to personal use. Irs 1040ez form online You abandon the property. Irs 1040ez form online The property is destroyed. Irs 1040ez form online Depreciation Methods Generally, you must use the Modified Accelerated Cost Recovery System (MACRS) to depreciate residential rental property placed in service after 1986. Irs 1040ez form online If you placed rental property in service before 1987, you are using one of the following methods. Irs 1040ez form online ACRS (Accelerated Cost Recovery System) for property placed in service after 1980 but before 1987. Irs 1040ez form online Straight line or declining balance method over the useful life of property placed in service before 1981. Irs 1040ez form online See MACRS Depreciation , later, for more information. Irs 1040ez form online Rental property placed in service before 2013. Irs 1040ez form online   Continue to use the same method of figuring depreciation that you used in the past. Irs 1040ez form online Use of real property changed. Irs 1040ez form online   Generally, you must use MACRS to depreciate real property that you acquired for personal use before 1987 and changed to business or income-producing use after 1986. Irs 1040ez form online This includes your residence that you changed to rental use. Irs 1040ez form online See Property Owned or Used in 1986 in Publication 946, chapter 1, for those situations in which MACRS is not allowed. Irs 1040ez form online Improvements made after 1986. Irs 1040ez form online   Treat an improvement made after 1986 to property you placed in service before 1987 as separate depreciable property. Irs 1040ez form online As a result, you can depreciate that improvement as separate property under MACRS if it is the type of property that otherwise qualifies for MACRS depreciation. Irs 1040ez form online For more information about improvements, see Additions or improvements to property , later in this chapter under Recovery Periods Under GDS. Irs 1040ez form online This publication discusses MACRS depreciation only. Irs 1040ez form online If you need information about depreciating property placed in service before 1987, see Publication 534. Irs 1040ez form online Basis of Depreciable Property The basis of property used in a rental activity is generally its adjusted basis when you place it in service in that activity. Irs 1040ez form online This is its cost or other basis when you acquired it, adjusted for certain items occurring before you place it in service in the rental activity. Irs 1040ez form online If you depreciate your property under MACRS, you may also have to reduce your basis by certain deductions and credits with respect to the property. Irs 1040ez form online Basis and adjusted basis are explained in the following discussions. Irs 1040ez form online If you used the property for personal purposes before changing it to rental use, its basis for depreciation is the lesser of its adjusted basis or its fair market value when you change it to rental use. Irs 1040ez form online See Basis of Property Changed to Rental Use in chapter 4. Irs 1040ez form online Cost Basis The basis of property you buy is usually its cost. Irs 1040ez form online The cost is the amount you pay for it in cash, in debt obligation, in other property, or in services. Irs 1040ez form online Your cost also includes amounts you pay for: Sales tax charged on the purchase (but see Exception next), Freight charges to obtain the property, and Installation and testing charges. Irs 1040ez form online Exception. Irs 1040ez form online   If you deducted state and local general sales taxes as an itemized deduction on Schedule A (Form 1040), do not include those sales taxes as part of your cost basis. Irs 1040ez form online Such taxes were deductible before 1987 and after 2003. Irs 1040ez form online Loans with low or no interest. Irs 1040ez form online   If you buy property on any time-payment plan that charges little or no interest, the basis of your property is your stated purchase price, less the amount considered to be unstated interest. Irs 1040ez form online See Unstated Interest and Original Issue Discount (OID) in Publication 537, Installment Sales. Irs 1040ez form online Real property. Irs 1040ez form online   If you buy real property, such as a building and land, certain fees and other expenses you pay are part of your cost basis in the property. Irs 1040ez form online Real estate taxes. Irs 1040ez form online   If you buy real property and agree to pay real estate taxes on it that were owed by the seller and the seller does not reimburse you, the taxes you pay are treated as part of your basis in the property. Irs 1040ez form online You cannot deduct them as taxes paid. Irs 1040ez form online   If you reimburse the seller for real estate taxes the seller paid for you, you can usually deduct that amount. Irs 1040ez form online Do not include that amount in your basis in the property. Irs 1040ez form online Settlement fees and other costs. Irs 1040ez form online   The following settlement fees and closing costs for buying the property are part of your basis in the property. Irs 1040ez form online Abstract fees. Irs 1040ez form online Charges for installing utility services. Irs 1040ez form online Legal fees. Irs 1040ez form online Recording fees. Irs 1040ez form online Surveys. Irs 1040ez form online Transfer taxes. Irs 1040ez form online Title insurance. Irs 1040ez form online Any amounts the seller owes that you agree to pay, such as back taxes or interest, recording or mortgage fees, charges for improvements or repairs, and sales commissions. Irs 1040ez form online   The following are settlement fees and closing costs you cannot include in your basis in the property. Irs 1040ez form online Fire insurance premiums. Irs 1040ez form online Rent or other charges relating to occupancy of the property before closing. Irs 1040ez form online Charges connected with getting or refinancing a loan, such as: Points (discount points, loan origination fees), Mortgage insurance premiums, Loan assumption fees, Cost of a credit report, and Fees for an appraisal required by a lender. Irs 1040ez form online   Also, do not include amounts placed in escrow for the future payment of items such as taxes and insurance. Irs 1040ez form online Assumption of a mortgage. Irs 1040ez form online   If you buy property and become liable for an existing mortgage on the property, your basis is the amount you pay for the property plus the amount remaining to be paid on the mortgage. Irs 1040ez form online Example. Irs 1040ez form online You buy a building for $60,000 cash and assume a mortgage of $240,000 on it. Irs 1040ez form online Your basis is $300,000. Irs 1040ez form online Separating cost of land and buildings. Irs 1040ez form online   If you buy buildings and your cost includes the cost of the land on which they stand, you must divide the cost between the land and the buildings to figure the basis for depreciation of the buildings. Irs 1040ez form online The part of the cost that you allocate to each asset is the ratio of the fair market value of that asset to the fair market value of the whole property at the time you buy it. Irs 1040ez form online   If you are not certain of the fair market values of the land and the buildings, you can divide the cost between them based on their assessed values for real estate tax purposes. Irs 1040ez form online Example. Irs 1040ez form online You buy a house and land for $200,000. Irs 1040ez form online The purchase contract does not specify how much of the purchase price is for the house and how much is for the land. Irs 1040ez form online The latest real estate tax assessment on the property was based on an assessed value of $160,000, of which $136,000 was for the house and $24,000 was for the land. Irs 1040ez form online You can allocate 85% ($136,000 ÷ $160,000) of the purchase price to the house and 15% ($24,000 ÷ $160,000) of the purchase price to the land. Irs 1040ez form online Your basis in the house is $170,000 (85% of $200,000) and your basis in the land is $30,000 (15% of $200,000). Irs 1040ez form online Basis Other Than Cost You cannot use cost as a basis for property that you received: In return for services you performed; In an exchange for other property; As a gift; From your spouse, or from your former spouse as the result of a divorce; or As an inheritance. Irs 1040ez form online If you received property in one of these ways, see Publication 551 for information on how to figure your basis. Irs 1040ez form online Adjusted Basis To figure your property's basis for depreciation, you may have to make certain adjustments (increases and decreases) to the basis of the property for events occurring between the time you acquired the property and the time you placed it in service for business or the production of income. Irs 1040ez form online The result of these adjustments to the basis is the adjusted basis. Irs 1040ez form online Increases to basis. Irs 1040ez form online   You must increase the basis of any property by the cost of all items properly added to a capital account. Irs 1040ez form online These include the following. Irs 1040ez form online The cost of any additions or improvements made before placing your property into service as a rental that have a useful life of more than 1 year. Irs 1040ez form online Amounts spent after a casualty to restore the damaged property. Irs 1040ez form online The cost of extending utility service lines to the property. Irs 1040ez form online Legal fees, such as the cost of defending and perfecting title, or settling zoning issues. Irs 1040ez form online Additions or improvements. Irs 1040ez form online   Add to the basis of your property the amount an addition or improvement actually cost you, including any amount you borrowed to make the addition or improvement. Irs 1040ez form online This includes all direct costs, such as material and labor, but does not include your own labor. Irs 1040ez form online It also includes all expenses related to the addition or improvement. Irs 1040ez form online   For example, if you had an architect draw up plans for remodeling your property, the architect's fee is a part of the cost of the remodeling. Irs 1040ez form online Or, if you had your lot surveyed to put up a fence, the cost of the survey is a part of the cost of the fence. Irs 1040ez form online   Keep separate accounts for depreciable additions or improvements made after you place the property in service in your rental activity. Irs 1040ez form online For information on depreciating additions or improvements, see Additions or improvements to property , later in this chapter, under Recovery Periods Under GDS. Irs 1040ez form online    The cost of landscaping improvements is usually treated as an addition to the basis of the land, which is not depreciable. Irs 1040ez form online However, see What Rental Property Cannot Be Depreciated, earlier. Irs 1040ez form online Assessments for local improvements. Irs 1040ez form online   Assessments for items which tend to increase the value of property, such as streets and sidewalks, must be added to the basis of the property. Irs 1040ez form online For example, if your city installs curbing on the street in front of your house, and assesses you and your neighbors for its cost, you must add the assessment to the basis of your property. Irs 1040ez form online Also add the cost of legal fees paid to obtain a decrease in an assessment levied against property to pay for local improvements. Irs 1040ez form online You cannot deduct these items as taxes or depreciate them. Irs 1040ez form online    However, you can deduct as taxes, charges or assessments for maintenance, repairs, or interest charges related to the improvements. Irs 1040ez form online Do not add them to your basis in the property. Irs 1040ez form online Deducting vs. Irs 1040ez form online capitalizing costs. Irs 1040ez form online   Do not add to your basis costs you can deduct as current expenses. Irs 1040ez form online However, there are certain costs you can choose either to deduct or to capitalize. Irs 1040ez form online If you capitalize these costs, include them in your basis. Irs 1040ez form online If you deduct them, do not include them in your basis. Irs 1040ez form online   The costs you may choose to deduct or capitalize include carrying charges, such as interest and taxes, that you must pay to own property. Irs 1040ez form online   For more information about deducting or capitalizing costs and how to make the election, see Carrying Charges in Publication 535, chapter 7. Irs 1040ez form online Decreases to basis. Irs 1040ez form online   You must decrease the basis of your property by any items that represent a return of your cost. Irs 1040ez form online These include the following. Irs 1040ez form online Insurance or other payment you receive as the result of a casualty or theft loss. Irs 1040ez form online Casualty loss not covered by insurance for which you took a deduction. Irs 1040ez form online Amount(s) you receive for granting an easement. Irs 1040ez form online Residential energy credits you were allowed before 1986, or after 2005, if you added the cost of the energy items to the basis of your home. Irs 1040ez form online Exclusion from income of subsidies for energy conservation measures. Irs 1040ez form online Special depreciation allowance claimed on qualified property. Irs 1040ez form online Depreciation you deducted, or could have deducted, on your tax returns under the method of depreciation you chose. Irs 1040ez form online If you did not deduct enough or deducted too much in any year, see Depreciation under Decreases to Basis in Publication 551. Irs 1040ez form online   If your rental property was previously used as your main home, you must also decrease the basis by the following. Irs 1040ez form online Gain you postponed from the sale of your main home before May 7, 1997, if the replacement home was converted to your rental property. Irs 1040ez form online District of Columbia first-time homebuyer credit allowed on the purchase of your main home after August 4, 1997 and before January 1, 2012. Irs 1040ez form online Amount of qualified principal residence indebtedness discharged on or after January 1, 2007. Irs 1040ez form online Claiming the Special Depreciation Allowance For 2013, your residential rental property may qualify for a special depreciation allowance. Irs 1040ez form online This allowance is figured before you figure your regular depreciation deduction. Irs 1040ez form online See Publication 946, chapter 3, for details. Irs 1040ez form online Also see the Instructions for Form 4562, Line 14. Irs 1040ez form online If you qualify for, but choose not to take, a special depreciation allowance, you must attach a statement to your return. Irs 1040ez form online The details of this election are in Publication 946, chapter 3, and the Instructions for Form 4562, Line 14. Irs 1040ez form online MACRS Depreciation Most business and investment property placed in service after 1986 is depreciated using MACRS. Irs 1040ez form online This section explains how to determine which MACRS depreciation system applies to your property. Irs 1040ez form online It also discusses other information you need to know before you can figure depreciation under MACRS. Irs 1040ez form online This information includes the property's: Recovery class, Applicable recovery period, Convention, Placed-in-service date, Basis for depreciation, and Depreciation method. Irs 1040ez form online Depreciation Systems MACRS consists of two systems that determine how you depreciate your property—the General Depreciation System (GDS) and the Alternative Depreciation System (ADS). Irs 1040ez form online You must use GDS unless you are specifically required by law to use ADS or you elect to use ADS. Irs 1040ez form online Excluded Property You cannot use MACRS for certain personal property (such as furniture or appliances) placed in service in your rental property in 2013 if it had been previously placed in service before 1987 when MACRS became effective. Irs 1040ez form online In most cases, personal property is excluded from MACRS if you (or a person related to you) owned or used it in 1986 or if your tenant is a person (or someone related to the person) who owned or used it in 1986. Irs 1040ez form online However, the property is not excluded if your 2013 deduction under MACRS (using a half-year convention) is less than the deduction you would have under ACRS. Irs 1040ez form online For more information, see What Method Can You Use To Depreciate Your Property? in Publication 946, chapter 1. Irs 1040ez form online Electing ADS If you choose, you can use the ADS method for most property. Irs 1040ez form online Under ADS, you use the straight line method of depreciation. Irs 1040ez form online The election of ADS for one item in a class of property generally applies to all property in that class that is placed in service during the tax year of the election. Irs 1040ez form online However, the election applies on a property-by-property basis for residential rental property and nonresidential real property. Irs 1040ez form online If you choose to use ADS for your residential rental property, the election must be made in the first year the property is placed in service. Irs 1040ez form online Once you make this election, you can never revoke it. Irs 1040ez form online For property placed in service during 2013, you make the election to use ADS by entering the depreciation on Form 4562, Part III, Section C, line 20c. Irs 1040ez form online Property Classes Under GDS Each item of property that can be depreciated under MACRS is assigned to a property class, determined by its class life. Irs 1040ez form online The property class generally determines the depreciation method, recovery period, and convention. Irs 1040ez form online The property classes under GDS are: 3-year property, 5-year property, 7-year property, 10-year property, 15-year property, 20-year property, Nonresidential real property, and Residential rental property. Irs 1040ez form online Under MACRS, property that you placed in service during 2013 in your rental activities generally falls into one of the following classes. Irs 1040ez form online 5-year property. Irs 1040ez form online This class includes computers and peripheral equipment, office machinery (typewriters, calculators, copiers, etc. Irs 1040ez form online ), automobiles, and light trucks. Irs 1040ez form online This class also includes appliances, carpeting, furniture, etc. Irs 1040ez form online , used in a residential rental real estate activity. Irs 1040ez form online Depreciation on automobiles, other property used for transportation, computers and related peripheral equipment, and property of a type generally used for entertainment, recreation, or amusement is limited. Irs 1040ez form online See chapter 5 of Publication 946. Irs 1040ez form online 7-year property. Irs 1040ez form online This class includes office furniture and equipment (desks, file cabinets, etc. Irs 1040ez form online ). Irs 1040ez form online This class also includes any property that does not have a class life and that has not been designated by law as being in any other class. Irs 1040ez form online 15-year property. Irs 1040ez form online This class includes roads, fences, and shrubbery (if depreciable). Irs 1040ez form online Residential rental property. Irs 1040ez form online This class includes any real property that is a rental building or structure (including a mobile home) for which 80% or more of the gross rental income for the tax year is from dwelling units. Irs 1040ez form online It does not include a unit in a hotel, motel, inn, or other establishment where more than half of the units are used on a transient basis. Irs 1040ez form online If you live in any part of the building or structure, the gross rental income includes the fair rental value of the part you live in. Irs 1040ez form online The other property classes do not generally apply to property used in rental activities. Irs 1040ez form online These classes are not discussed in this publication. Irs 1040ez form online See Publication 946 for more information. Irs 1040ez form online Recovery Periods Under GDS The recovery period of property is the number of years over which you recover its cost or other basis. Irs 1040ez form online The recovery periods are generally longer under ADS than GDS. Irs 1040ez form online The recovery period of property depends on its property class. Irs 1040ez form online Under GDS, the recovery period of an asset is generally the same as its property class. Irs 1040ez form online Class lives and recovery periods for most assets are listed in Appendix B of Publication 946. Irs 1040ez form online See Table 2-1 for recovery periods of property commonly used in residential rental activities. Irs 1040ez form online Qualified Indian reservation property. Irs 1040ez form online   Shorter recovery periods are provided under MACRS for qualified Indian reservation property placed in service on Indian reservations. Irs 1040ez form online For more information, see chapter 4 of Publication 946. Irs 1040ez form online Additions or improvements to property. Irs 1040ez form online   Treat additions or improvements you make to your depreciable rental property as separate property items for depreciation purposes. Irs 1040ez form online   The property class and recovery period of the addition or improvement is the one that would apply to the original property if you had placed it in service at the same time as the addition or improvement. Irs 1040ez form online   The recovery period for an addition or improvement to property begins on the later of: The date the addition or improvement is placed in service, or The date the property to which the addition or improvement was made is placed in service. Irs 1040ez form online Example. Irs 1040ez form online You own a residential rental house that you have been renting since 1986 and depreciating under ACRS. Irs 1040ez form online You built an addition onto the house and placed it in service in 2013. Irs 1040ez form online You must use MACRS for the addition. Irs 1040ez form online Under GDS, the addition is depreciated as residential rental property over 27. Irs 1040ez form online 5 years. Irs 1040ez form online Table 2-1. Irs 1040ez form online MACRS Recovery Periods for Property Used in Rental Activities   MACRS Recovery Period   Type of Property General Depreciation System Alternative Depreciation System   Computers and their peripheral equipment 5 years 5 years   Office machinery, such as: Typewriters Calculators Copiers 5 years 6 years   Automobiles 5 years 5 years   Light trucks 5 years 5 years   Appliances, such as: Stoves Refrigerators 5 years 9 years   Carpets 5 years 9 years   Furniture used in rental property 5 years 9 years   Office furniture and equipment, such as: Desks Files 7 years 10 years   Any property that does not have a class life and that has not been designated by law as being in any other class 7 years 12 years   Roads 15 years 20 years   Shrubbery 15 years 20 years   Fences 15 years 20 years   Residential rental property (buildings or structures) and structural components such as furnaces, waterpipes, venting, etc. Irs 1040ez form online 27. Irs 1040ez form online 5 years 40 years   Additions and improvements, such as a new roof The same recovery period as that of the property to which the addition or improvement is made, determined as if the property were placed in service at the same time as the addition or improvement. Irs 1040ez form online   Conventions A convention is a method established under MACRS to set the beginning and end of the recovery period. Irs 1040ez form online The convention you use determines the number of months for which you can claim depreciation in the year you place property in service and in the year you dispose of the property. Irs 1040ez form online Mid-month convention. Irs 1040ez form online    A mid-month convention is used for all residential rental property and nonresidential real property. Irs 1040ez form online Under this convention, you treat all property placed in service, or disposed of, during any month as placed in service, or disposed of, at the midpoint of that month. Irs 1040ez form online Mid-quarter convention. Irs 1040ez form online   A mid-quarter convention must be used if the mid-month convention does not apply and the total depreciable basis of MACRS property placed in service in the last 3 months of a tax year (excluding nonresidential real property, residential rental property, and property placed in service and disposed of in the same year) is more than 40% of the total basis of all such property you place in service during the year. Irs 1040ez form online   Under this convention, you treat all property placed in service, or disposed of, during any quarter of a tax year as placed in service, or disposed of, at the midpoint of the quarter. Irs 1040ez form online Example. Irs 1040ez form online During the tax year, Tom Martin purchased the following items to use in his rental property. Irs 1040ez form online He elects not to claim the special depreciation allowance discussed earlier. Irs 1040ez form online A dishwasher for $400 that he placed in service in January. Irs 1040ez form online Used furniture for $100 that he placed in service in September. Irs 1040ez form online A refrigerator for $800 that he placed in service in October. Irs 1040ez form online Tom uses the calendar year as his tax year. Irs 1040ez form online The total basis of all property placed in service that year is $1,300. Irs 1040ez form online The $800 basis of the refrigerator placed in service during the last 3 months of his tax year exceeds $520 (40% × $1,300). Irs 1040ez form online Tom must use the mid-quarter convention instead of the half-year convention for all three items. Irs 1040ez form online Half-year convention. Irs 1040ez form online    The half-year convention is used if neither the mid-quarter convention nor the mid-month convention applies. Irs 1040ez form online Under this convention, you treat all property placed in service, or disposed of, during a tax year as placed in service, or disposed of, at the midpoint of that tax year. Irs 1040ez form online   If this convention applies, you deduct a half year of depreciation for the first year and the last year that you depreciate the property. Irs 1040ez form online You deduct a full year of depreciation for any other year during the recovery period. Irs 1040ez form online Figuring Your Depreciation Deduction You can figure your MACRS depreciation deduction in one of two ways. Irs 1040ez form online The deduction is substantially the same both ways. Irs 1040ez form online You can either: Actually compute the deduction using the depreciation method and convention that apply over the recovery period of the property, or Use the percentage from the MACRS percentage tables. Irs 1040ez form online In this publication we will use the percentage tables. Irs 1040ez form online For instructions on how to compute the deduction, see chapter 4 of Publication 946. Irs 1040ez form online Residential rental property. Irs 1040ez form online   You must use the straight line method and a mid-month convention for residential rental property. Irs 1040ez form online In the first year that you claim depreciation for residential rental property, you can claim depreciation only for the number of months the property is in use, and you must use the mid-month convention (explained under Conventions , earlier). Irs 1040ez form online 5-, 7-, or 15-year property. Irs 1040ez form online   For property in the 5- or 7-year class, use the 200% declining balance method and a half-year convention. Irs 1040ez form online However, in limited cases you must use the mid-quarter convention, if it applies. Irs 1040ez form online For property in the 15-year class, use the 150% declining balance method and a half-year convention. Irs 1040ez form online   You can also choose to use the 150% declining balance method for property in the 5- or 7-year class. Irs 1040ez form online The choice to use the 150% method for one item in a class of property applies to all property in that class that is placed in service during the tax year of the election. Irs 1040ez form online You make this election on Form 4562. Irs 1040ez form online In Part III, column (f), enter “150 DB. Irs 1040ez form online ” Once you make this election, you cannot change to another method. Irs 1040ez form online   If you use either the 200% or 150% declining balance method, you figure your deduction using the straight line method in the first tax year that the straight line method gives you an equal or larger deduction. Irs 1040ez form online   You can also choose to use the straight line method with a half-year or mid-quarter convention for 5-, 7-, or 15-year property. Irs 1040ez form online The choice to use the straight line method for one item in a class of property applies to all property in that class that is placed in service during the tax year of the election. Irs 1040ez form online You elect the straight line method on Form 4562. Irs 1040ez form online In Part III, column (f), enter “S/L. Irs 1040ez form online ” Once you make this election, you cannot change to another method. Irs 1040ez form online MACRS Percentage Tables You can use the percentages in Table 2-2, earlier, to compute annual depreciation under MACRS. Irs 1040ez form online The tables show the percentages for the first few years or until the change to the straight line method is made. Irs 1040ez form online See Appendix A of Publication 946 for complete tables. Irs 1040ez form online The percentages in Tables 2-2a, 2-2b, and 2-2c make the change from declining balance to straight line in the year that straight line will give a larger deduction. Irs 1040ez form online If you elect to use the straight line method for 5-, 7-, or 15-year property, or the 150% declining balance method for 5- or 7-year property, use the tables in Appendix A of Publication 946. Irs 1040ez form online How to use the percentage tables. Irs 1040ez form online   You must apply the table rates to your property's unadjusted basis (defined below) each year of the recovery period. Irs 1040ez form online   Once you begin using a percentage table to figure depreciation, you must continue to use it for the entire recovery period unless there is an adjustment to the basis of your property for a reason other than: Depreciation allowed or allowable, or An addition or improvement that is depreciated as a separate item of property. Irs 1040ez form online   If there is an adjustment for any reason other than (1) or (2), for example, because of a deductible casualty loss, you can no longer use the table. Irs 1040ez form online For the year of the adjustment and for the remaining recovery period, figure depreciation using the property's adjusted basis at the end of the year and the appropriate depreciation method, as explained earlier under Figuring Your Depreciation Deduction . Irs 1040ez form online See Figuring the Deduction Without Using the Tables in Publication 946, chapter 4. Irs 1040ez form online Unadjusted basis. Irs 1040ez form online   This is the same basis you would use to figure gain on a sale (see Basis of Depreciable Property , earlier), but without reducing your original basis by any MACRS depreciation taken in earlier years. Irs 1040ez form online   However, you do reduce your original basis by other amounts claimed on the property, including: Any amortization, Any section 179 deduction, and Any special depreciation allowance. Irs 1040ez form online For more information, see chapter 4 of Publication 946. Irs 1040ez form online Please click here for the text description of the image. Irs 1040ez form online Table 2-2 Tables 2-2a, 2-2b, and 2-2c. Irs 1040ez form online   The percentages in these tables take into account the half-year and mid-quarter conventions. Irs 1040ez form online Use Table 2-2a for 5-year property, Table 2-2b for 7-year property, and Table 2-2c for 15-year property. Irs 1040ez form online Use the percentage in the second column (half-year convention) unless you are required to use the mid-quarter convention (explained earlier). Irs 1040ez form online If you must use the mid-quarter convention, use the column that corresponds to the calendar year quarter in which you placed the property in service. Irs 1040ez form online Example 1. Irs 1040ez form online You purchased a stove and refrigerator and placed them in service in June. Irs 1040ez form online Your basis in the stove is $600 and your basis in the refrigerator is $1,000. Irs 1040ez form online Both are 5-year property. Irs 1040ez form online Using the half-year convention column in Table 2-2a, the depreciation percentage for Year 1 is 20%. Irs 1040ez form online For that year your depreciation deduction is $120 ($600 × . Irs 1040ez form online 20) for the stove and $200 ($1,000 × . Irs 1040ez form online 20) for the refrigerator. Irs 1040ez form online For Year 2, the depreciation percentage is 32%. Irs 1040ez form online That year's depreciation deduction will be $192 ($600 × . Irs 1040ez form online 32) for the stove and $320 ($1,000 × . Irs 1040ez form online 32) for the refrigerator. Irs 1040ez form online Example 2. Irs 1040ez form online Assume the same facts as in Example 1, except you buy the refrigerator in October instead of June. Irs 1040ez form online Since the refrigerator was placed in service in the last 3 months of the tax year, and its basis ($1,000) is more than 40% of the total basis of all property placed in service during the year ($1,600 × . Irs 1040ez form online 40 = $640), you are required to use the mid-quarter convention to figure depreciation on both the stove and refrigerator. Irs 1040ez form online Because you placed the refrigerator in service in October, you use the fourth quarter column of Table 2-2a and find the depreciation percentage for Year 1 is 5%. Irs 1040ez form online Your depreciation deduction for the refrigerator is $50 ($1,000 x . Irs 1040ez form online 05). Irs 1040ez form online Because you placed the stove in service in June, you use the second quarter column of Table 2-2a and find the depreciation percentage for Year 1 is 25%. Irs 1040ez form online For that year, your depreciation deduction for the stove is $150 ($600 x . Irs 1040ez form online 25). Irs 1040ez form online Table 2-2d. Irs 1040ez form online    Use this table when you are using the GDS 27. Irs 1040ez form online 5 year option for residential rental property. Irs 1040ez form online Find the row for the month that you placed the property in service. Irs 1040ez form online Use the percentages listed for that month to figure your depreciation deduction. Irs 1040ez form online The mid-month convention is taken into account in the percentages shown in the table. Irs 1040ez form online Continue to use the same row (month) under the column for the appropriate year. Irs 1040ez form online Example. Irs 1040ez form online You purchased a single family rental house for $185,000 and placed it in service on February 8. Irs 1040ez form online The sales contract showed that the building cost $160,000 and the land cost $25,000. Irs 1040ez form online Your basis for depreciation is its original cost, $160,000. Irs 1040ez form online This is the first year of service for your residential rental property and you decide to use GDS which has a recovery period of 27. Irs 1040ez form online 5 years. Irs 1040ez form online Using Table 2-2d, you find that the percentage for property placed in service in February of Year 1 is 3. Irs 1040ez form online 182%. Irs 1040ez form online That year's depreciation deduction is $5,091 ($160,000 x . Irs 1040ez form online 03182). Irs 1040ez form online Figuring MACRS Depreciation Under ADS Table 2–1, earlier, shows the ADS recovery periods for property used in rental activities. Irs 1040ez form online See Appendix B in Publication 946 for other property. Irs 1040ez form online If your property is not listed in Appendix B, it is considered to have no class life. Irs 1040ez form online Under ADS, personal property with no class life is depreciated using a recovery period of 12 years. Irs 1040ez form online Use the mid-month convention for residential rental property and nonresidential real property. Irs 1040ez form online For all other property, use the half-year or mid-quarter convention, as appropriate. Irs 1040ez form online See Publication 946 for ADS depreciation tables. Irs 1040ez form online Claiming the Correct Amount of Depreciation You should claim the correct amount of depreciation each tax year. Irs 1040ez form online If you did not claim all the depreciation you were entitled to deduct, you must still reduce your basis in the property by the full amount of depreciation that you could have deducted. Irs 1040ez form online For more information, see Depreciation under Decreases to Basis in Publication 551. Irs 1040ez form online If you deducted an incorrect amount of depreciation for property in any year, you may be able to make a correction by filing Form 1040X, Amended U. Irs 1040ez form online S. Irs 1040ez form online Individual Income Tax Return. Irs 1040ez form online If you are not allowed to make the correction on an amended return, you can change your accounting method to claim the correct amount of depreciation. Irs 1040ez form online Filing an amended return. Irs 1040ez form online   You can file an amended return to correct the amount of depreciation claimed for any property in any of the following situations. Irs 1040ez form online You claimed the incorrect amount because of a mathematical error made in any year. Irs 1040ez form online You claimed the incorrect amount because of a posting error made in any year. Irs 1040ez form online You have not adopted a method of accounting for property placed in service by you in tax years ending after December 29, 2003. Irs 1040ez form online You claimed the incorrect amount on property placed in service by you in tax years ending before December 30, 2003. Irs 1040ez form online   Generally, you adopt a method of accounting for depreciation by using a permissible method of determining depreciation when you file your first tax return for the property used in your rental activity. Irs 1040ez form online This also occurs when you use the same impermissible method of determining depreciation (for example, using the wrong MACRS recovery period) in two or more consecutively filed tax returns. Irs 1040ez form online   If an amended return is allowed, you must file it by the later of the following dates. Irs 1040ez form online 3 years from the date you filed your original return for the year in which you did not deduct the correct amount. Irs 1040ez form online A return filed before an unextended due date is considered filed on that due date. Irs 1040ez form online 2 years from the time you paid your tax for that year. Irs 1040ez form online Changing your accounting method. Irs 1040ez form online   To change your accounting method, you generally must file Form 3115, Application for Change in Accounting Method, to get the consent of the IRS. Irs 1040ez form online In some instances, that consent is automatic. Irs 1040ez form online For more information, see Changing Your Accounting Method in Publication 946,  chapter 1. Irs 1040ez form online Prev  Up  Next   Home   More Online Publications
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Fake Form W-8BEN Used in IRS Tax Scams

Remember:
You can only submit Form W-8BEN directly to your
withholding agent.

The Form W-8BEN (Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding) is a legitimate U.S. tax exemption document.

However, fraudsters typically target non-residents of the U.S. and use the W-8BEN format to acquire personal details such as,

  • mother's maiden name,
  • passport number,
  • date of birth,
  • PIN numbers and passcodes.

The legitimate IRS Form W-8BEN, does not ask for any of that information.
The fraudulent forms use various angles that may claim, for example:

  • Anti-money laundering regulations require a review of your client information and ask you to complete the form.
  • You are exempt from tax reporting and withholdings on income including interest paid to you. To protect your exemption from tax please complete the attached form.

What do I do if I receive such a scam form via email, fax, mail, or other format?

  1. Do not reply.
  2. Do not open any attachments.
    Attachments may contain malicious code that will infect your computer.
  3. Do not click on any links.
    If you clicked on links in a suspicious email or phishing website and entered confidential information, visit our identity protection page.
  4. Forward the email as-is, to us at phishing@irs.gov.
  5. After you forward the email and/or header information to us, delete the original email message you received.

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Page Last Reviewed or Updated: 24-Mar-2014

The Irs 1040ez Form Online

Irs 1040ez form online Publication 3 - Main Content Table of Contents Gross IncomeForeign Source Income Military Spouses Residency Relief Act (MSRRA) Community Property Form W-2 Codes Adjustments to IncomeArmed Forces Reservists Individual Retirement Arrangements Moving Expenses Combat Zone ExclusionCombat Zone Serving in a Combat Zone Amount of Exclusion Alien StatusResident Aliens Nonresident Aliens Dual-Status Aliens Sale of HomePeriod of suspension. Irs 1040ez form online Qualified official extended duty. Irs 1040ez form online ForeclosuresLump Sum Portion of Settlement Payment. Irs 1040ez form online Interest Payment on Lump Sum Portion of Settlement Payment. Irs 1040ez form online Lost Equity Portion of Settlement Payment. Irs 1040ez form online The rules that apply to a lost equity payment you received for the foreclosure of a property that was not your main home are different. Irs 1040ez form online Interest Payment on Lost Equity Portion of Settlement Payment. Irs 1040ez form online Itemized DeductionsEmployee Business Expenses Repayments CreditsFirst-Time Homebuyer Credit Child Tax Credit Earned Income Credit Credit for Excess Social Security Tax Withheld Forgiveness of Decedent's Tax LiabilityCombat Zone Related Forgiveness Terrorist or Military Action Related Forgiveness Claims for Tax Forgiveness Filing ReturnsSame-Sex Marriage Where To File When To File Signing Returns Extension of DeadlinesService That Qualifies for an Extension of Deadline Length of Extension Actions for Which Deadlines Are Extended Deferral of Payment Maximum Rate of Interest How To Get Tax HelpLow Income Taxpayer Clinics Gross Income Members of the Armed Forces receive many different types of pay and allowances. Irs 1040ez form online Some are included in gross income while others are excluded from gross income. Irs 1040ez form online Included items (Table 1) are subject to tax and must be reported on your tax return. Irs 1040ez form online Excluded items (Table 2) are not subject to tax, but may have to be shown on your tax return. Irs 1040ez form online For information on the exclusion of pay for service in a combat zone and other tax benefits for combat zone participants, see Combat Zone Exclusion and Extension of Deadlines , later. Irs 1040ez form online Table 1. Irs 1040ez form online Included Items These items are included in gross income, unless the pay is for service in a combat zone. Irs 1040ez form online Basic pay • Active duty   Bonus pay • Career status   • Attendance at a designated service school     • Enlistment  • Officer   • Back wages     • Overseas extension   • CONUS COLA       • Reenlistment   • Drills         • Reserve training         • Training duty   Other pay  • Accrued leave          • High deployment per diem Special • Aviation career incentives      • Personal money allowances paid to pay • Career sea     high-ranking officers   • Diving duty      • Student loan repayment from programs   • Foreign duty (outside the 48 contiguous     such as the Department of Defense   states and the District of Columbia)     Educational Loan Repayment Program   • Foreign language proficiency     when year's service (requirement) is not   • Hardship duty     attributable to a combat zone   • Hostile fire or imminent danger         • Medical and dental officers   Incentive pay  • Submarine   • Nuclear-qualified officers      • Flight   • Optometry      • Hazardous duty   • Pharmacy      • High altitude/Low Opening (HALO)   • Special compensation for assistance with activities of daily living (SCAADL)         • Special duty assignment pay         • Veterinarian         • Voluntary Separation Incentive       Basic allowance for housing (BAH). Irs 1040ez form online   You can still deduct mortgage interest and real estate taxes on your home if you pay these expenses with your BAH. Irs 1040ez form online Table 2. Irs 1040ez form online Excluded Items The exclusion for certain items applies whether the item is furnished in kind or is a reimbursement or allowance. Irs 1040ez form online There is no exclusion for the personal use of a government-provided vehicle. Irs 1040ez form online Combat  zone pay • Compensation for active service while in a combat zone Note: Limited amount for officers     • Housing and cost-of-living allowances abroad paid by the U. Irs 1040ez form online S. Irs 1040ez form online Government or by a foreign government         • OHA (Overseas Housing Allowance)                     Other pay • Defense counseling         • Disability, including payments received for injuries incurred as a direct result of a terrorist or military action         • Group-term life insurance   Moving • Dislocation   • Professional education   allowances • Military base realignment and   • ROTC educational and subsistence     closure benefit    allowances     (the exclusion is limited as   • State bonus pay for service in a     described above)   combat zone     • Move-in housing   • Survivor and retirement protection     • Moving household and   plan premiums     personal items   • Uniform allowances     • Moving trailers or mobile homes   • Uniforms furnished to enlisted     • Storage   personnel     • Temporary lodging and         temporary lodging expenses                 Travel • Annual round trip for dependent Death • Burial services   allowances students allowances • Death gratuity payments to     • Leave between consecutive   eligible survivors     overseas tours   • Travel of dependents to burial site     • Reassignment in a dependent         restricted status Family • Certain educational expenses for     • Transportation for you or your allowances dependents     dependents during ship overhaul   • Emergencies     or inactivation   • Evacuation to a place of safety     • Per diem   • Separation             In-kind military • Dependent-care assistance program Living • BAH (Basic Allowance for Housing)   benefits • Legal assistance allowances • BAS (Basic Allowance for Subsistence)     • Medical/dental care         • Commissary/exchange discounts         • Space-available travel on government aircraft           Death gratuity. Irs 1040ez form online   Any death gratuity paid to a survivor of a member of the Armed Forces is excluded from gross income. Irs 1040ez form online Differential wage payments. Irs 1040ez form online   Differential wage payments are any payments made by an employer to an individual for a period during which the individual is performing service in the uniformed services while on active duty for a period of more than 30 days and that represent all or a portion of the wages the individual would have received from the employer if the individual was performing services for the employer. Irs 1040ez form online These amounts are taxable and cannot be excluded as combat pay. Irs 1040ez form online Military base realignment and closure benefit. Irs 1040ez form online   Payments made under the Homeowners Assistance Program (HAP) generally are excluded from income. Irs 1040ez form online However, the excludable amount cannot be more than the maximum amount described in subsection (c) of 42 USC 3374 as in effect on November 6, 2009. Irs 1040ez form online Any part of the payment that is more than this limit is included in gross income. Irs 1040ez form online For more information about the HAP, see http://hap. Irs 1040ez form online usace. Irs 1040ez form online army. Irs 1040ez form online mil/Overview. Irs 1040ez form online html. Irs 1040ez form online Qualified reservist distribution (QRD). Irs 1040ez form online   A QRD is a distribution to an individual of all or part of the individual's balance in a cafeteria plan or health flexible spending arrangement if: The individual was a reservist who was ordered or called to active duty for more than 179 days or for an indefinite period, and The distribution is made no sooner than the date the reservist was ordered or called to active duty and no later than the last day reimbursements could otherwise be made under the arrangement for the plan year which includes the date of the order or the call to duty. Irs 1040ez form online A QRD is included in gross income and is subject to employment taxes. Irs 1040ez form online The employer must include the QRD (reduced by after-tax contributions to the health flexible spending arrangement) as wages on Form W-2, Wage and Tax Statement. Irs 1040ez form online Thrift Savings Plan (TSP) distributions. Irs 1040ez form online   If you participate in the Uniformed Services TSP and receive a distribution from your account, the distribution is generally included in your taxable income. Irs 1040ez form online   If your contributions included tax-exempt combat zone pay, the part of the distribution attributable to those contributions is tax exempt. Irs 1040ez form online However, the earnings on the tax-exempt portion of the distribution are taxable. Irs 1040ez form online The TSP will provide a statement showing the taxable and non-taxable portions of the distribution. Irs 1040ez form online Roth Thrift Savings Plan (TSP) balance. Irs 1040ez form online   You may be able to contribute to a designated Roth Account through the TSP known as the Roth TSP. Irs 1040ez form online Roth TSP contributions are after-tax contributions, subject to the same contribution limits as the traditional TSP. Irs 1040ez form online Qualified distributions from a Roth TSP are not included in your income. Irs 1040ez form online For more details, see Thrift Savings Accounts in Part II of Publication 721, Tax Guide to U. Irs 1040ez form online S. Irs 1040ez form online Civil Service Retirement Benefits. Irs 1040ez form online State bonus payments. Irs 1040ez form online   Bonus payments made by a state (or a political subdivision thereof) to a member or former member of the uniformed services of the United States or to a dependent of such member are considered combat pay (and therefore may not be taxable) if the payments are made only because of the member's service in a combat zone. Irs 1040ez form online See Combat Zone , later, for a list of designated combat zones. Irs 1040ez form online Foreign Source Income If you are a U. Irs 1040ez form online S. Irs 1040ez form online citizen with income from sources outside the United States (foreign income), you must report all of that income (except for amounts that U. Irs 1040ez form online S. Irs 1040ez form online law allows you to exclude) on your tax return. Irs 1040ez form online This is true whether you reside inside or outside the United States and whether or not you receive a Form W-2 or a Form 1099. Irs 1040ez form online This applies to earned income (such as wages and tips) as well as unearned income (such as interest, dividends, capital gains, pensions, rents, and royalties). Irs 1040ez form online Certain taxpayers can exclude income earned in foreign countries. Irs 1040ez form online For 2013, this exclusion amount can be as much as $97,600. Irs 1040ez form online However, the foreign earned income exclusion does not apply to the wages and salaries of military and civilian employees of the U. Irs 1040ez form online S. Irs 1040ez form online Government. Irs 1040ez form online Employees of the U. Irs 1040ez form online S. Irs 1040ez form online Government include those who work at United States Armed Forces exchanges, commissioned and noncommissioned officers' messes, Armed Forces motion picture services, and similar personnel. Irs 1040ez form online Other foreign income earned by military personnel or their spouses may be eligible for the foreign earned income exclusion. Irs 1040ez form online For more information on the exclusion, see Publication 54. Irs 1040ez form online Residents of American Samoa may be able to exclude income from American Samoa. Irs 1040ez form online This possession exclusion does not apply to wages and salaries of military and civilian employees of the U. Irs 1040ez form online S. Irs 1040ez form online Government. Irs 1040ez form online If you need information on the possession exclusion, see Publication 570, Tax Guide for Individuals With Income From U. Irs 1040ez form online S. Irs 1040ez form online Possessions. Irs 1040ez form online Military Spouses Residency Relief Act (MSRRA) If you are the civilian spouse of an active duty U. Irs 1040ez form online S. Irs 1040ez form online military servicemember and your domicile is the same as the servicemember's, you can choose to keep your prior residence or domicile for tax purposes when you accompany the servicemember spouse, who is relocating under military orders to a new duty station in one of the 50 states, the District of Columbia, or a U. Irs 1040ez form online S. Irs 1040ez form online possession. Irs 1040ez form online See Publication 570 for more information. Irs 1040ez form online Domicile. Irs 1040ez form online   Your domicile is the permanent legal home you intend to use for an indefinite or unlimited period, and to which, when absent, you intend to return. Irs 1040ez form online It is not always where you presently live. Irs 1040ez form online Community Property The pay you earn as a member of the Armed Forces may be subject to community property laws depending on your marital status, your domicile, and the nature of the payment. Irs 1040ez form online The community property states are Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin. Irs 1040ez form online Marital status. Irs 1040ez form online   Community property rules apply to married persons whose domicile during the tax year was in a community property state. Irs 1040ez form online The rules may affect your tax liability if you file separate returns or are divorced during the year. Irs 1040ez form online Nevada, Washington, and California domestic partners. Irs 1040ez form online   A registered domestic partner in Nevada, Washington, or California generally must report half the combined income of the individual and his or her domestic partner. Irs 1040ez form online See Form 8958 and Publication 555, Community Property. Irs 1040ez form online Nature of the payment. Irs 1040ez form online   Active duty military pay is subject to community property laws. Irs 1040ez form online Armed Forces retired or retainer pay may be subject to community property laws. Irs 1040ez form online   For more information on community property laws, see Publication 555. Irs 1040ez form online Form W-2 Codes Form W-2 shows your total pay and other compensation and the income tax, social security tax, and Medicare tax that was withheld during the year. Irs 1040ez form online Form W-2 also shows other amounts that you may find important in box 12. Irs 1040ez form online The amounts shown in box 12 are generally preceded by a code. Irs 1040ez form online A list of codes used in box 12 is shown, next. Irs 1040ez form online Form W-2 Reference Guide for Box 12 Codes A Uncollected social security or RRTA J Nontaxable sick pay T Adoption benefits   tax on tips             K 20% excise tax on excess golden V Income from exercise of B Uncollected Medicare tax on tips   parachute payments   nonstatutory stock option(s)             C Taxable cost of group-term life L Substantiated employee business W Employer contributions (including   insurance over $50,000   expense reimbursements   employee contributions through a           cafeteria plan) to an employee's D Elective deferrals under a section M Uncollected social security or RRTA   health savings account (HSA)   401(k) cash or deferred arrangement   tax on taxable cost of group-term life       plan (including a SIMPLE 401(k)   insurance over $50,000 (former Y Deferrals under a section 409A   arrangement)   employees only)   nonqualified deferred           compensation plan E Elective deferrals under a section N Uncollected Medicare tax on taxable       403(b) salary reduction agreement   cost of group-term life insurance Z Income under section 409A on a       over $50,000 (former employees only)   nonqualified deferred F Elective deferrals under a section       compensation plan   408(k)(6) salary reduction SEP P Excludable moving expense           reimbursements paid directly to AA Designated Roth contributions G Elective deferrals and employer   employee   under a section 401(k) plan   contributions (including nonelective           deferrals) to a section 457(b) Q Nontaxable combat pay BB Designated Roth contributions   deferred compensation plan       under a section 403(b) plan     R Employer contributions to an Archer     H Elective deferrals to a section   MSA DD Cost of employer-sponsored   501(c)(18)(D) tax-exempt       health coverage   organization plan S Employee salary reduction contributions under a section 408(p) SIMPLE  EE  Designated Roth contributions under a governmental section 457(b) plan  Note. Irs 1040ez form online For more information on these codes, see your Form(s) W-2. Irs 1040ez form online Adjustments to Income Adjusted gross income is your total income minus certain adjustments. Irs 1040ez form online The following adjustments are of particular interest to members of the Armed Forces. Irs 1040ez form online Armed Forces Reservists If you are a member of a reserve component of the Armed Forces and you travel more than 100 miles away from home in connection with your performance of services as a member of the reserves, you can deduct your unreimbursed travel expenses as an adjustment to income on line 24 of Form 1040, U. Irs 1040ez form online S. Irs 1040ez form online Individual Income Tax Return, rather than as a miscellaneous itemized deduction. Irs 1040ez form online Include all unreimbursed expenses from the time you leave home until the time you return home. Irs 1040ez form online The deduction is limited to the amount the federal government generally reimburses its employees for travel expenses. Irs 1040ez form online For more information about this limit, see Per Diem and Car Allowances in chapter 6 of Publication 463. Irs 1040ez form online Member of a reserve component. Irs 1040ez form online   You are a member of a reserve component of the Armed Forces if you are in the Army, Navy, Marine Corps, Air Force, or Coast Guard Reserve, the Army National Guard of the United States, the Air National Guard of the United States, or the Reserve Corps of the Public Health Service. Irs 1040ez form online How to report. Irs 1040ez form online   If you have reserve-related travel that takes you more than 100 miles from home, you should first complete Form 2106, Employee Business Expenses, or Form 2106-EZ, Unreimbursed Employee Business Expenses. Irs 1040ez form online Then enter on Form 1040, line 24, the part of your expenses, up to the federal rate, included on Form 2106, line 10, or Form 2106-EZ, line 6, that is for reserve-related travel more than 100 miles from your home. Irs 1040ez form online Subtract this amount from the total on Form 2106, line 10, or Form 2106-EZ, line 6, and deduct the balance as an itemized deduction on Schedule A (Form 1040), line 21. Irs 1040ez form online Example. Irs 1040ez form online Captain Harris, a member of the Army Reserve, traveled to a location 220 miles from his home to perform his work in the reserves in April 2013. Irs 1040ez form online He incurred $1,549 of unreimbursed expenses consisting of $249 for mileage (440 miles × 56. Irs 1040ez form online 5 cents per mile), $300 for meals, and $1,000 for lodging. Irs 1040ez form online He also had other deductible mileage expenses of $110 for several trips to a location 20 miles from his home. Irs 1040ez form online Only 50% of his meal expenses are deductible. Irs 1040ez form online He shows his total deductible travel expenses of $1,509 ($249 + $150 (50% of $300) + $1,000 + $110) on Form 2106, line 10. Irs 1040ez form online He enters the $1,399 ($249 + $150 + $1,000) for travel over 100 miles from home on Form 1040, line 24. Irs 1040ez form online He then subtracts that $1,399 from the amount on Form 2106, $1,509, and enters $110 on Schedule A (Form 1040), line 21. Irs 1040ez form online Individual Retirement Arrangements Generally, you can deduct the lesser of the contributions to your traditional individual retirement arrangement (IRA) for the year or the general limit (or spousal IRA limit, if applicable). Irs 1040ez form online However, if you or your spouse was covered by an employer-maintained retirement plan at any time during the year for which contributions were made, you may not be able to deduct all of the contributions. Irs 1040ez form online The Form W-2 you or your spouse receives from an employer has a box used to indicate whether you were covered for the year. Irs 1040ez form online The “Retirement plan” box should have a mark in it if you were covered. Irs 1040ez form online For purposes of a deduction for contributions to a traditional IRA, Armed Forces members (including reservists on active duty for more than 90 days during the year) are considered covered by an employer-maintained retirement plan. Irs 1040ez form online Individuals serving in the U. Irs 1040ez form online S. Irs 1040ez form online Armed Forces or in support of the U. Irs 1040ez form online S. Irs 1040ez form online Armed Forces in designated combat zones have additional time to make a qualified retirement contribution to an IRA. Irs 1040ez form online For more information on this extension of deadline provision, see Extension of Deadlines , later. Irs 1040ez form online For more information on IRAs, see Publication 590. Irs 1040ez form online Combat Pay For IRA purposes, your compensation includes nontaxable combat pay. Irs 1040ez form online This means that even though you do not have to include the combat pay in your gross income, you do include it in your compensation when figuring the limits on contributions and deductions of contributions to IRAs. Irs 1040ez form online Qualified Reservist Distributions A qualified reservist distribution is defined below. Irs 1040ez form online It is not subject to the 10% additional tax on early distributions from certain retirement plans. Irs 1040ez form online Definition. Irs 1040ez form online   A distribution you receive is a qualified reservist distribution if the following requirements are met. Irs 1040ez form online You were ordered or called to active duty after September 11, 2001. Irs 1040ez form online You were ordered or called to active duty for a period of more than 179 days or for an indefinite period because you are a member of a reserve component (see Member of a reserve component , earlier, under Armed Forces Reservists. Irs 1040ez form online ) The distribution is from an IRA or from amounts attributable to elective deferrals under a section 401(k) or 403(b) plan or a similar arrangement. Irs 1040ez form online The distribution was made no earlier than the date of the order or call to active duty and no later than the close of the active duty period. Irs 1040ez form online Qualified Reservist Repayments You may be able to contribute (repay) to an IRA amounts equal to any qualified reservist distributions (defined earlier) you received. Irs 1040ez form online You can make these repayment contributions even if they would cause your total contributions to the IRA to be more than the general limit on contributions. Irs 1040ez form online You make these repayment contributions to an IRA, even if you received the qualified reservist distribution from a section 401(k) or 403(b) plan or a similar arrangement. Irs 1040ez form online Limit. Irs 1040ez form online   Your qualified reservist repayments cannot be more than your qualified reservist distributions. Irs 1040ez form online When repayment contributions can be made. Irs 1040ez form online   You cannot make these repayment contributions after the date that is 2 years after your active duty period ends. Irs 1040ez form online No deduction. Irs 1040ez form online   You cannot deduct qualified reservist repayments. Irs 1040ez form online Figuring your IRA deduction. Irs 1040ez form online   The repayment of qualified reservist distributions does not affect the amount you can deduct as an IRA contribution. Irs 1040ez form online Reporting the repayment. Irs 1040ez form online   If you repay a qualified reservist distribution, include the amount of the repayment with nondeductible contributions on line 1 of Form 8606, Nondeductible IRAs. Irs 1040ez form online Moving Expenses To deduct moving expenses, you generally must meet certain time and distance tests. Irs 1040ez form online However, if you are a member of the Armed Forces on active duty and you move because of a permanent change of station, you do not have to meet these tests. Irs 1040ez form online You can deduct your unreimbursed moving expenses on Form 3903. Irs 1040ez form online Permanent change of station. Irs 1040ez form online   A permanent change of station includes: A move from your home to your first post of active duty, A move from one permanent post of duty to another, and A move from your last post of duty to your home or to a nearer point in the United States. Irs 1040ez form online The move must occur within 1 year of ending your active duty or within the period allowed under the Joint Federal Travel Regulations. Irs 1040ez form online Spouse and dependents. Irs 1040ez form online   If you are the spouse or dependent of a member of the Armed Forces who deserts, is imprisoned, or dies, a permanent change of station for you includes a move to: The member's place of enlistment or induction, Your, or the member's, home of record, or A nearer point in the United States. Irs 1040ez form online   If the military moves you to or from a different location than the member, the moves are treated as a single move to your new main job location. Irs 1040ez form online Services or reimbursements provided by the government. Irs 1040ez form online   Do not include in your income the value of moving and storage services provided by the government because of a permanent change of station. Irs 1040ez form online Similarly, do not include in income amounts received as a dislocation allowance, temporary lodging expense, temporary lodging allowance, or move-in housing allowance. Irs 1040ez form online   Generally, if the total reimbursements or allowances that you receive from the government because of the move are more than your actual moving expenses, the excess is included in your wages on Form W-2. Irs 1040ez form online However, if any reimbursements or allowances (other than dislocation, temporary lodging, temporary lodging expense, or move-in housing allowances) exceed the cost of moving and the excess is not included in your wages on Form W-2, the excess still must be included in gross income on Form 1040, line 7. Irs 1040ez form online   Use Form 3903 to deduct qualified expenses that exceed your reimbursements and allowances (including dislocation, temporary lodging, temporary lodging expense, or move-in housing allowances that are excluded from gross income). Irs 1040ez form online   If you must relocate and your spouse and dependents move to or from a different location, do not include in income reimbursements, allowances, or the value of moving and storage services provided by the government to move you and your spouse and dependents to and from the separate locations. Irs 1040ez form online   Do not deduct any expenses for moving services that were provided by the government. Irs 1040ez form online Also, do not deduct any expenses that were reimbursed by an allowance you did not include in income. Irs 1040ez form online Deductible Moving Expenses If you move because of a permanent change of station, you can deduct the reasonable unreimbursed expenses of moving you and members of your household. Irs 1040ez form online You can deduct expenses (if not reimbursed or furnished in kind) for: Moving household goods and personal effects, and Travel. Irs 1040ez form online Moving household goods and personal effects. Irs 1040ez form online   You can deduct the expenses of moving your household goods and personal effects, including expenses for hauling a trailer, packing, crating, in-transit storage, and insurance. Irs 1040ez form online You cannot deduct expenses for moving furniture or other goods you bought on the way from your old home to your new home. Irs 1040ez form online Storing and insuring household goods and personal effects. Irs 1040ez form online   You can include only the cost of storing and insuring your household goods and personal effects within any period of 30 consecutive days after the day these goods and effects are moved from your former home and before they are delivered to your new home. Irs 1040ez form online Travel. Irs 1040ez form online   You can deduct the expenses of traveling (including lodging but not meals) from your old home to your new home, including car expenses and air fare. Irs 1040ez form online You can deduct as car expenses either: Your actual out-of-pocket expenses such as gas and oil, or The standard mileage rate of 24 cents a mile. Irs 1040ez form online   You can add parking fees and tolls to the amount claimed under either method. Irs 1040ez form online You cannot deduct any expenses for meals. Irs 1040ez form online You cannot deduct the cost of unnecessary side trips or lavish and extravagant lodging. Irs 1040ez form online Member of your household. Irs 1040ez form online   A member of your household is anyone who has both your former home and your new home as his or her main home. Irs 1040ez form online It does not include a tenant or employee unless you can claim that person as a dependent. Irs 1040ez form online Foreign Moves A foreign move is a move from the United States or its possessions to a foreign country or from one foreign country to another foreign country. Irs 1040ez form online A move from a foreign country to the United States or its possessions is not a foreign move. Irs 1040ez form online For a foreign move, the deductible moving expenses described earlier are expanded to include the reasonable expenses of: Moving your household goods and personal effects to and from storage, and Storing these items for part or all of the time the new job location remains your main job location. Irs 1040ez form online The new job location must be outside the United States. Irs 1040ez form online Reporting Moving Expenses Figure moving expense deductions on Form 3903. Irs 1040ez form online Carry the deduction from Form 3903 to Form 1040, line 26. Irs 1040ez form online For more information, see Publication 521 and Form 3903. Irs 1040ez form online Combat Zone Exclusion If you are a member of the U. Irs 1040ez form online S. Irs 1040ez form online Armed Forces who serves in a combat zone (defined later), you can exclude certain pay from your income. Irs 1040ez form online This pay is generally referred to as “combat pay. Irs 1040ez form online ” You do not actually need to show the exclusion on your tax return because income that qualifies for the combat zone exclusion is not included in the wages reported on your Form W-2. Irs 1040ez form online (See Form W-2 , later. Irs 1040ez form online ) The month for which you receive the pay must be a month in which you either served in a combat zone or were hospitalized as a result of wounds, disease, or injury incurred while serving in the combat zone. Irs 1040ez form online You do not have to receive the excluded pay while you are in a combat zone, are hospitalized, or in the same year you served in a combat zone. Irs 1040ez form online If you are an enlisted member, warrant officer, or commissioned warrant officer, you can exclude the following amounts from your income. Irs 1040ez form online (Other officer personnel are discussed under Amount of Exclusion , later. Irs 1040ez form online ) Active duty pay earned in any month you served in a combat zone. Irs 1040ez form online Imminent danger/hostile fire pay. Irs 1040ez form online A reenlistment bonus if the voluntary extension or reenlistment occurs in a month you served in a combat zone. Irs 1040ez form online Pay for accrued leave earned in any month you served in a combat zone. Irs 1040ez form online The Department of Defense must determine that the unused leave was earned during that period. Irs 1040ez form online Pay received for duties as a member of the Armed Forces in clubs, messes, post and station theaters, and other nonappropriated fund activities. Irs 1040ez form online The pay must be earned in a month you served in a combat zone. Irs 1040ez form online Awards for suggestions, inventions, or scientific achievements you are entitled to because of a submission you made in a month you served in a combat zone. Irs 1040ez form online Student loan repayments. Irs 1040ez form online If the entire year of service required to earn the repayment was performed in a combat zone, the entire repayment made because of that year of service is excluded. Irs 1040ez form online If only part of that year of service was performed in a combat zone, only part of the repayment qualifies for exclusion. Irs 1040ez form online For example, if you served in a combat zone for 5 months, 5/12 of your repayment qualifies for exclusion. Irs 1040ez form online Retirement pay and pensions do not qualify for the combat zone exclusion. Irs 1040ez form online Partial (month) service. Irs 1040ez form online   If you serve in a combat zone for any part of one or more days during a particular month, you are entitled to an exclusion for that entire month. Irs 1040ez form online Form W-2. Irs 1040ez form online   The wages shown in box 1 of your 2013 Form W-2 should not include military pay excluded from your income under the combat zone exclusion provisions. Irs 1040ez form online If it does, you will need to get a corrected Form W-2 from your finance office. Irs 1040ez form online   You cannot exclude as combat pay any wages shown in box 1 of Form W-2. Irs 1040ez form online Combat Zone A combat zone is any area the President of the United States designates by Executive Order as an area in which the U. Irs 1040ez form online S. Irs 1040ez form online Armed Forces are engaging or have engaged in combat. Irs 1040ez form online An area usually becomes a combat zone and ceases to be a combat zone on the dates the President designates by Executive Order. Irs 1040ez form online Afghanistan area. Irs 1040ez form online   By Executive Order No. Irs 1040ez form online 13239, Afghanistan (and airspace above) was designated as a combat zone beginning September 19, 2001. Irs 1040ez form online On December 14, 2001, the following countries were certified by the Department of Defense for combat zone tax benefits due to their direct support of military operations in the Afghanistan combat zone. Irs 1040ez form online Djibouti. Irs 1040ez form online Jordan. Irs 1040ez form online Kyrgyzstan. Irs 1040ez form online Pakistan. Irs 1040ez form online Somalia. Irs 1040ez form online Syria. Irs 1040ez form online Tajikistan. Irs 1040ez form online Uzbekistan. Irs 1040ez form online Yemen. Irs 1040ez form online The Philippines. Irs 1040ez form online  Note. Irs 1040ez form online For the Philippines only, the personnel must be deployed in conjunction with Operation Enduring Freedom supporting military operations in the Afghanistan combat zone. Irs 1040ez form online The Kosovo area. Irs 1040ez form online   By Executive Order No. Irs 1040ez form online 13119, the following locations (including airspace above) were designated as a combat zone beginning March 24, 1999. Irs 1040ez form online Federal Republic of Yugoslavia (Serbia/Montenegro). Irs 1040ez form online Albania. Irs 1040ez form online Kosovo. Irs 1040ez form online The Adriatic Sea. Irs 1040ez form online The Ionian Sea—north of the 39th parallel. Irs 1040ez form online Note. Irs 1040ez form online The combat zone designation for Montenegro and Kosovo (previously a province within Serbia) under Executive Order 13119 remains in force even though Montenegro and Kosovo became independent nations since EO 13119 was signed. Irs 1040ez form online Arabian peninsula. Irs 1040ez form online   By Executive Order No. Irs 1040ez form online 12744, the following locations (and airspace above) were designated as a combat zone beginning January 17, 1991. Irs 1040ez form online The Persian Gulf. Irs 1040ez form online The Red Sea. Irs 1040ez form online The Gulf of Oman. Irs 1040ez form online The part of the Arabian Sea that is north of 10 degrees north latitude and west of 68 degrees east longitude. Irs 1040ez form online The Gulf of Aden. Irs 1040ez form online The total land areas of Iraq, Kuwait, Saudi Arabia, Oman, Bahrain, Qatar, and the United Arab Emirates. Irs 1040ez form online Jordan which is in direct support of the Arabian Peninsula. Irs 1040ez form online Serving in a Combat Zone You are considered to be serving in a combat zone if you are either assigned on official temporary duty to a combat zone or you qualify for hostile fire/imminent danger pay while in a combat zone. Irs 1040ez form online Service in a combat zone includes any periods you are absent from duty because of sickness, wounds, or leave. Irs 1040ez form online If, as a result of serving in a combat zone, a person becomes a prisoner of war or is missing in action, that person is considered to be serving in the combat zone so long as he or she keeps that status for military pay purposes. Irs 1040ez form online Hospitalized While Serving in a Combat Zone If you are hospitalized while serving in a combat zone, the wound, disease, or injury causing the hospitalization will be presumed to have been incurred while serving in the combat zone unless there is clear evidence to the contrary. Irs 1040ez form online Example. Irs 1040ez form online You are hospitalized for a specific disease in a combat zone where you have been serving for 3 weeks, and the disease for which you are hospitalized has an incubation period of 2 to 4 weeks. Irs 1040ez form online The disease is presumed to have been incurred while you were serving in the combat zone. Irs 1040ez form online On the other hand, if the incubation period of the disease is 1 year, the disease would not have been incurred while you were serving in the combat zone. Irs 1040ez form online Hospitalized After Leaving a Combat Zone In some cases, the wound, disease, or injury may have been incurred while you were serving in the combat zone, even though you were not hospitalized until after you left. Irs 1040ez form online In that case, you can exclude military pay earned while you are hospitalized as a result of the wound, disease, or injury. Irs 1040ez form online Example. Irs 1040ez form online You were hospitalized for a specific disease 3 weeks after you left the combat zone. Irs 1040ez form online The incubation period of the disease is from 2 to 4 weeks. Irs 1040ez form online The disease is presumed to have been incurred while serving in the combat zone. Irs 1040ez form online Nonqualifying Presence in Combat Zone None of the following types of military service qualify as service in a combat zone. Irs 1040ez form online Presence in a combat zone while on leave from a duty station located outside the combat zone. Irs 1040ez form online Passage over or through a combat zone during a trip between two points that are outside a combat zone. Irs 1040ez form online Presence in a combat zone solely for your personal convenience. Irs 1040ez form online Service Outside Combat Zone Considered Service in Combat Zone Military service outside a combat zone is considered to be performed in a combat zone if: The Department of Defense designates that the service is in direct support of military operations in the combat zone, and The service qualifies you for special military pay for duty subject to hostile fire or imminent danger. Irs 1040ez form online Military pay received for this service will qualify for the combat zone exclusion if all of the requirements (other than service in a combat zone) are met and the pay is verifiable by reference to military pay records. Irs 1040ez form online Amount of Exclusion If you are an enlisted member, warrant officer, or commissioned warrant officer and you serve in a combat zone during any part of a month, you can exclude all of your military pay for that month. Irs 1040ez form online It should not be included in the wages reported on your Form W-2. Irs 1040ez form online You also can exclude military pay earned while you are hospitalized as a result of wounds, disease, or injury incurred in the combat zone. Irs 1040ez form online If you are hospitalized, you cannot exclude any military pay received for any month of service that begins more than 2 years after the end of combat activities in the combat zone. Irs 1040ez form online Your hospitalization does not have to be in the combat zone. Irs 1040ez form online If you are a commissioned officer (other than a commissioned warrant officer), you can exclude your pay according to the rules just discussed. Irs 1040ez form online However, the amount of your exclusion is limited to the highest rate of enlisted pay (plus imminent danger/hostile fire pay you received) for each month during any part of which you served in a combat zone or were hospitalized as a result of your service there. Irs 1040ez form online Alien Status For tax purposes, an alien is an individual who is not a U. Irs 1040ez form online S. Irs 1040ez form online citizen. Irs 1040ez form online An alien is in one of three categories: resident, nonresident, or dual-status. Irs 1040ez form online Placement in the correct category is crucial in determining what income to report and what forms to file. Irs 1040ez form online Under peacetime enlistment rules, you generally cannot enlist in the Armed Forces unless you are a citizen or have been legally admitted to the United States for permanent residence. Irs 1040ez form online If you are an alien enlistee in the Armed Forces, you are probably a resident alien. Irs 1040ez form online If, under an income tax treaty, you are considered a resident of a foreign country, see your base legal officer. Irs 1040ez form online Other aliens who are in the United States only because of military assignments and who have a home outside the United States are nonresident aliens. Irs 1040ez form online Guam and Puerto Rico have special rules. Irs 1040ez form online Residents of those areas should contact their taxing authority with their questions. Irs 1040ez form online Most members of the Armed Forces are U. Irs 1040ez form online S. Irs 1040ez form online citizens or resident aliens. Irs 1040ez form online However, if you have questions about your alien status or the alien status of your dependents or spouse, you should read the information in the following paragraphs and see Publication 519. Irs 1040ez form online Resident Aliens You are considered a resident alien of the United States for tax purposes if you meet either the “green card test” or the “substantial presence test” for the calendar year (January 1–December 31). Irs 1040ez form online If you meet the substantial presence test for 2014, you did not meet either the green card test or the substantial presence test for 2012 or 2013, and you did not choose to be treated as a resident for part of 2012, you may be able to choose to be treated as a U. Irs 1040ez form online S. Irs 1040ez form online resident for part of 2013. Irs 1040ez form online See First-Year Choice in Publication 519. Irs 1040ez form online These tests are explained in Publication 519. Irs 1040ez form online Generally, resident aliens are taxed on their worldwide income and file the same tax forms as U. Irs 1040ez form online S. Irs 1040ez form online citizens. Irs 1040ez form online Treating nonresident alien spouse as resident alien. Irs 1040ez form online   A nonresident alien spouse can be treated as a resident alien if all the following conditions are met. Irs 1040ez form online One spouse is a U. Irs 1040ez form online S. Irs 1040ez form online citizen or resident alien at the end of the tax year. Irs 1040ez form online That spouse is married to the nonresident alien at the end of the tax year. Irs 1040ez form online You both choose to treat the nonresident alien spouse as a resident alien. Irs 1040ez form online Making the choice. Irs 1040ez form online   Both you and your spouse must sign a statement and attach it to your joint return for the first tax year for which the choice applies. Irs 1040ez form online Include in the statement: A declaration that one spouse was a nonresident alien and the other was a U. Irs 1040ez form online S. Irs 1040ez form online citizen or resident alien on the last day of the year, A declaration that both spouses choose to be treated as U. Irs 1040ez form online S. Irs 1040ez form online residents for the entire tax year, and The name, address, and taxpayer identification number (social security number or individual taxpayer identification number) of each spouse. Irs 1040ez form online If the nonresident alien spouse is not eligible to get a social security number, he or she should file Form W-7, Application for IRS Individual Taxpayer Identification Number. Irs 1040ez form online    Once you make this choice, the nonresident alien spouse's worldwide income is subject to U. Irs 1040ez form online S. Irs 1040ez form online tax. Irs 1040ez form online If the nonresident alien spouse has substantial foreign income, there may be no advantage to making this choice. Irs 1040ez form online Ending the choice. Irs 1040ez form online   Once you make this choice, it applies to all later years unless one of the following situations occurs. Irs 1040ez form online You or your spouse revokes the choice. Irs 1040ez form online You or your spouse dies. Irs 1040ez form online You and your spouse become legally separated under a decree of divorce or separate maintenance. Irs 1040ez form online The Internal Revenue Service ends the choice because you or your spouse kept inadequate records. Irs 1040ez form online For specific details on these situations, see Publication 519. Irs 1040ez form online   If the choice is ended for any of these reasons, neither spouse can make the choice for any later year. Irs 1040ez form online Choice not made. Irs 1040ez form online   If you and your nonresident alien spouse do not make this choice: You cannot file a joint return. Irs 1040ez form online You can file as married filing separately, or head of household if you qualify. Irs 1040ez form online You can claim an exemption for your nonresident alien spouse if he or she has no gross income for U. Irs 1040ez form online S. Irs 1040ez form online tax purposes and is not another taxpayer's dependent. Irs 1040ez form online The nonresident alien spouse generally does not have to file a federal income tax return if he or she had no income from sources in the United States. Irs 1040ez form online If a return has to be filed, see the next discussion. Irs 1040ez form online The nonresident alien spouse is not eligible for the earned income credit if he or she has to file a return. Irs 1040ez form online Nonresident Aliens If you are an alien who does not meet the requirements discussed earlier to be a resident alien, you are a nonresident alien. Irs 1040ez form online If you are required to file a federal tax return, you must file either Form 1040NR, U. Irs 1040ez form online S. Irs 1040ez form online Nonresident Alien Income Tax Return, or Form 1040NR-EZ, U. Irs 1040ez form online S. Irs 1040ez form online Income Tax Return for Certain Nonresident Aliens With No Dependents. Irs 1040ez form online See the form instructions for information on who must file and filing status. Irs 1040ez form online If you are a nonresident alien, you generally must pay tax on income from sources in the United States. Irs 1040ez form online Your income from conducting a trade or business in the United States is taxed at graduated U. Irs 1040ez form online S. Irs 1040ez form online tax rates. Irs 1040ez form online Other income from U. Irs 1040ez form online S. Irs 1040ez form online sources is taxed at a flat 30% (or lower treaty) rate. Irs 1040ez form online For example, dividends from a U. Irs 1040ez form online S. Irs 1040ez form online corporation paid to a nonresident alien generally are subject to a 30% (or lower treaty) rate. Irs 1040ez form online Dual-Status Aliens You can be both a nonresident and resident alien during the same tax year. Irs 1040ez form online This usually occurs in the year you arrive in or depart from the United States. Irs 1040ez form online If you are a dual-status alien, you are taxed on income from all sources for the part of the year you are a resident alien. Irs 1040ez form online Generally, for the part of the year you are a nonresident alien, you are taxed only on income from sources in the United States. Irs 1040ez form online Sale of Home You may not have to pay tax on all or part of the gain from the sale of your main home. Irs 1040ez form online Usually, your main home is the one you live in most of the time. Irs 1040ez form online It can be a: House, Houseboat, Mobile home, Cooperative apartment, or Condominium. Irs 1040ez form online You generally can exclude up to $250,000 of gain ($500,000, in most cases, if married filing a joint return) realized on the sale or exchange of a main home in 2013. Irs 1040ez form online The exclusion is allowed each time you sell or exchange a main home, but generally not more than once every 2 years. Irs 1040ez form online To be eligible, during the 5-year period ending on the date of the sale, you must have owned the home for at least 2 years (the ownership test), and lived in the home as your main home for at least 2 years (the use test). Irs 1040ez form online Exception to ownership and use tests. Irs 1040ez form online   You can exclude gain, but the maximum amount of gain you can exclude will be reduced if you do not meet the ownership and use tests due to a move to a new permanent duty station. Irs 1040ez form online 5-year test period suspended. Irs 1040ez form online   You can choose to have the 5-year test period for ownership and use suspended during any period you or your spouse serve on qualified official extended duty as a member of the Armed Forces. Irs 1040ez form online This means that you may be able to meet the 2-year use test even if, because of your service, you did not actually live in your home for at least the required 2 years during the 5-year period ending on the date of sale. Irs 1040ez form online Example. Irs 1040ez form online David bought and moved into a home in 2005. Irs 1040ez form online He lived in it as his main home for 2½ years. Irs 1040ez form online For the next 6 years, he did not live in it because he was on qualified official extended duty with the Army. Irs 1040ez form online He then sold the home at a gain in 2013. Irs 1040ez form online To meet the use test, David chooses to suspend the 5-year test period for the 6 years he was on qualifying official extended duty. Irs 1040ez form online This means he can disregard those 6 years. Irs 1040ez form online Therefore, David's 5-year test period consists of the 5 years before he went on qualifying official extended duty. Irs 1040ez form online He meets the ownership and use tests because he owned and lived in the home for 2½ years during this test period. Irs 1040ez form online Period of suspension. Irs 1040ez form online   The period of suspension cannot last more than 10 years. Irs 1040ez form online You cannot suspend the 5-year period for more than one property at a time. Irs 1040ez form online You can revoke your choice to suspend the 5-year period at any time. Irs 1040ez form online Qualified official extended duty. Irs 1040ez form online   You are on qualified official extended duty if you serve on extended duty either: At a duty station at least 50 miles from your main home, or While you live in Government quarters under Government orders. Irs 1040ez form online   You are on extended duty when you are called or ordered to active duty for a period of more than 90 days or for an indefinite period. Irs 1040ez form online Property used for rental or business. Irs 1040ez form online   You may be able to exclude your gain from the sale of a home that you have used as a rental property or for business. Irs 1040ez form online However, you must meet the ownership and use tests discussed in Publication 523. Irs 1040ez form online Nonqualified use. Irs 1040ez form online   If the sale of your main home results in a gain that is allocated to one or more period(s) of nonqualified use, you cannot exclude that gain from your income. Irs 1040ez form online   Nonqualified use means any period after 2008 when neither you nor your spouse (or your former spouse) used the property as a main home, with certain exceptions. Irs 1040ez form online For example, a period of nonqualified use does not include any period (not to exceed a total of 10 years) during which you or your spouse is serving on qualified official extended duty. Irs 1040ez form online Loss. Irs 1040ez form online   You cannot deduct a loss from the sale of your main home. Irs 1040ez form online More information. Irs 1040ez form online   For more information, see Publication 523. Irs 1040ez form online Foreclosures There may be tax consequences as a result of compensation payments for foreclosures. Irs 1040ez form online Payments made for violations of the Service Members Civil Relief Act (SCRA). Irs 1040ez form online   All service members who received a settlement payment reported on a Form 1099 may need to report the amount on their tax return. Irs 1040ez form online Generally, you must include settlement payments in income. Irs 1040ez form online However, the tax treatment of settlement payments will depend on the facts and circumstances. Irs 1040ez form online Lump Sum Portion of Settlement Payment. Irs 1040ez form online    Generally, you must include the lump sum payment in gross income. Irs 1040ez form online In limited circumstances you may be able to exclude part or all of the lump sum payment from gross income. Irs 1040ez form online For example, you may qualify to exclude part or all of the payment from gross income if you can show that the payment was made to reimburse specific nondeductible expenses (such as living expenses) you incurred because of the SCRA violation. Irs 1040ez form online Interest Payment on Lump Sum Portion of Settlement Payment. Irs 1040ez form online    You must include any interest on the lump sum portion of your settlement payment in your income. Irs 1040ez form online Lost Equity Portion of Settlement Payment. Irs 1040ez form online    If you lost your main home in foreclosure, you should treat the lost equity payment as an additional amount you received on the foreclosure of the home. Irs 1040ez form online You will have a gain on the foreclosure only if the sum of the lost equity payment and the value of the main home at foreclosure is more than what you paid for the home. Irs 1040ez form online In many cases, this gain may be excluded from income. Irs 1040ez form online For more information on the rules for excluding all or part of any gain from the sale (including a foreclosure) of a main home, see Pub. Irs 1040ez form online 523, Selling Your Home. Irs 1040ez form online The rules that apply to a lost equity payment you received for the foreclosure of a property that was not your main home are different. Irs 1040ez form online    To find rules for reporting gain or loss on the foreclosure of property that was not your main home, see Pub. Irs 1040ez form online 544, Sales and Other Dispositions of Assets. Irs 1040ez form online Interest Payment on Lost Equity Portion of Settlement Payment. Irs 1040ez form online    You must include any interest on the lost equity portion of your settlement payment in your income. Irs 1040ez form online Itemized Deductions To figure your taxable income, you must subtract either your standard deduction or your itemized deductions from adjusted gross income. Irs 1040ez form online For information on the standard deduction, see Publication 501. Irs 1040ez form online Itemized deductions are figured on Schedule A (Form 1040). Irs 1040ez form online This chapter discusses miscellaneous itemized deductions of particular interest to members of the Armed Forces. Irs 1040ez form online For information on other itemized deductions, see the publications listed below. Irs 1040ez form online Publication 502, Medical and Dental Expenses. Irs 1040ez form online Publication 526, Charitable Contributions. Irs 1040ez form online Publication 547, Casualties, Disasters, and Thefts. Irs 1040ez form online Publication 550, Investment Income and Expenses. Irs 1040ez form online You must reduce the total of most miscellaneous itemized deductions by 2% of your adjusted gross income. Irs 1040ez form online For information on deductions that are not subject to the 2% limit, see Publication 529. Irs 1040ez form online Employee Business Expenses Deductible employee business expenses generally are miscellaneous itemized deductions subject to the 2% limit. Irs 1040ez form online Certain employee business expenses are deductible as adjustments to income. Irs 1040ez form online For information on many employee business expenses, see Publication 463. Irs 1040ez form online Generally, you must file Form 2106, Employee Business Expenses, or Form 2106-EZ, Unreimbursed Employee Business Expenses, to claim these expenses. Irs 1040ez form online You do not have to file Form 2106 or Form 2106-EZ if you are claiming only unreimbursed expenses for uniforms, professional society dues, and work-related educational expenses (all discussed later). Irs 1040ez form online You can deduct these expenses directly on Schedule A (Form 1040). Irs 1040ez form online Reimbursement. Irs 1040ez form online   Generally, to receive advances, reimbursements, or other allowances from the government, you must adequately account for your expenses and return any excess reimbursement. Irs 1040ez form online Your reimbursed expenses are not deductible. Irs 1040ez form online   If your expenses are more than your reimbursement, the excess expenses are deductible (subject to the 2% limit) if you can prove them. Irs 1040ez form online You must file Form 2106 to report these expenses. Irs 1040ez form online   You can use the shorter Form 2106-EZ if you meet all three of the following conditions. Irs 1040ez form online You are an employee deducting expenses related to your job. Irs 1040ez form online You were not reimbursed by your employer for your expenses. Irs 1040ez form online (Amounts included in box 1 of Form W-2 are not considered reimbursements. Irs 1040ez form online ) If you claim car expenses, you use the standard mileage rate. Irs 1040ez form online    For 2013, the standard mileage rate is 56. Irs 1040ez form online 5 cents a mile for all business miles driven. Irs 1040ez form online This rate is adjusted periodically. Irs 1040ez form online Travel Expenses You can deduct unreimbursed travel expenses only if they are incurred while you are traveling away from home. Irs 1040ez form online If you are a member of the U. Irs 1040ez form online S. Irs 1040ez form online Armed Forces on a permanent duty assignment overseas, you are not traveling away from home. Irs 1040ez form online You cannot deduct your expenses for meals and lodging while at your permanent duty station. Irs 1040ez form online You cannot deduct these expenses even if you have to maintain a home in the United States for your family members who are not allowed to accompany you overseas. Irs 1040ez form online A naval officer assigned to permanent duty aboard a ship that has regular eating and living facilities has a home aboard ship for travel expense purposes. Irs 1040ez form online To be deductible, your travel expenses must be work related. Irs 1040ez form online You cannot deduct any expenses for personal travel, such as visits to family while on furlough, leave, or liberty. Irs 1040ez form online Away from home. Irs 1040ez form online   Home is your permanent duty station (which can be a ship or base), regardless of where you or your family live. Irs 1040ez form online You are away from home if you are away from your permanent duty station substantially longer than an ordinary day's work and you need to get sleep or rest to meet the demands of your work while away from home. Irs 1040ez form online   Examples of deductible travel expenses include: Expenses for business-related meals (generally limited to 50% of your unreimbursed cost), lodging, taxicabs, business telephone calls, tips, laundry, and dry cleaning while you are away from home on temporary duty or temporary additional duty, and Expenses of carrying out official business while on “No Cost” orders. Irs 1040ez form online    You cannot deduct any expenses for travel away from home if the temporary assignment in a single location is realistically expected to last (and does in fact last) for more than 1 year. Irs 1040ez form online This rule may not apply if you are participating in a federal crime investigation or prosecution. Irs 1040ez form online For more information, see Publication 463 and the Form 2106 instructions. Irs 1040ez form online Transportation Expenses These expenses include the ordinary and necessary costs of: Getting from one workplace to another when you are not away from home, Going to a business meeting away from your regular workplace, and Getting from your home to a temporary workplace when you have a regular place of work. Irs 1040ez form online These expenses include the costs of transportation by air, bus, rail, taxi, and driving and maintaining your car. Irs 1040ez form online Transportation expenses incurred while traveling away from home are included with your travel expenses, discussed earlier. Irs 1040ez form online However, if you use your car while traveling away from home overnight, see the rules in chapter 4 of Publication 463 to figure your car expense deduction. Irs 1040ez form online If you must go from one workplace to another while on duty (for example, as a courier or to attend meetings) without being away from home, your unreimbursed transportation expenses are deductible. Irs 1040ez form online However, the expenses of getting to and from your regular place of work (commuting) are not deductible. Irs 1040ez form online Temporary work location. Irs 1040ez form online   If you have one or more regular places of business away from your home and you commute to a temporary work location in the same trade or business, you can deduct the expenses of the daily round-trip transportation between your home and the temporary location. Irs 1040ez form online   Generally, if your employment at a work location is realistically expected to last (and does in fact last) for 1 year or less, the employment is temporary. Irs 1040ez form online   If your employment at a work location is realistically expected to last for more than 1 year or if there is no realistic expectation that the employment will last for 1 year or less, the employment is not temporary, regardless of whether it actually lasts for more than 1 year. Irs 1040ez form online If employment at a work location initially is realistically expected to last for 1 year or less, but at some later date the employment is realistically expected to last more than 1 year, that employment will be treated as temporary (unless there are facts and circumstances that would indicate otherwise) until your expectation changes. Irs 1040ez form online    If you do not have a regular place of business, but you ordinarily work in the metropolitan area where you live, you can deduct daily transportation expenses between your home and a temporary work site outside your metropolitan area. Irs 1040ez form online However, you cannot deduct daily transportation costs between your home and temporary work sites within your metropolitan area. Irs 1040ez form online These are nondeductible commuting costs. Irs 1040ez form online Armed Forces reservists. Irs 1040ez form online   A meeting of an Armed Forces reserve unit is a second place of business if the meeting is held on a day on which you work at your regular job. Irs 1040ez form online You can deduct the expense of getting from one workplace to the other. Irs 1040ez form online You usually cannot deduct the expense if the reserve meeting is held on a day on which you do not work at your regular job. Irs 1040ez form online In this case, your transportation generally is a nondeductible commuting expense. Irs 1040ez form online However, you can deduct your transportation expenses if the location of the meeting is temporary and you have one or more regular places of work. Irs 1040ez form online   If you ordinarily work in a particular metropolitan area but not at any specific location and the reserve meeting is held at a temporary location outside that metropolitan area, you can deduct your transportation expenses. Irs 1040ez form online If you travel away from home overnight to attend a guard or reserve meeting, you can deduct your travel expenses. Irs 1040ez form online See Armed Forces Reservists under Adjustments to Income, earlier. Irs 1040ez form online Uniforms You usually cannot deduct the expenses for uniform cost and upkeep. Irs 1040ez form online Generally, you must wear uniforms when on duty and you are allowed to wear them when off duty. Irs 1040ez form online If military regulations prohibit you from wearing certain uniforms when off duty, you can deduct the cost and upkeep of the uniforms, but you must reduce your expenses by any allowance or reimbursement you receive. Irs 1040ez form online Unreimbursed expenses for the cost and upkeep of the following articles are deductible. Irs 1040ez form online Military battle dress uniforms and utility uniforms that you cannot wear when off duty. Irs 1040ez form online Articles not replacing regular clothing, including insignia of rank, corps devices, epaulets, aiguillettes, and swords. Irs 1040ez form online Reservists' uniforms if you can wear the uniform only while performing duties as a reservist. Irs 1040ez form online Professional Dues You can deduct unreimbursed dues paid to professional societies directly related to your military position. Irs 1040ez form online However, you cannot deduct amounts paid to an officers' club or a noncommissioned officers' club. Irs 1040ez form online Example. Irs 1040ez form online Lieutenant Margaret Allen, an electrical engineer at Maxwell Air Force Base, can deduct professional dues paid to the American Society of Electrical Engineers. Irs 1040ez form online Educational Expenses You can deduct the unreimbursed costs of qualifying work-related education. Irs 1040ez form online This is education that meets at least one of the following two tests. Irs 1040ez form online The education is required by your employer or the law to keep your present salary, status, or job. Irs 1040ez form online The required education must serve a bona fide business purpose of your employer. Irs 1040ez form online The education maintains or improves skills needed in your present work. Irs 1040ez form online However, even if the education meets one or both of the above tests, it is not qualifying education if it: Is needed to meet the minimum educational requirements of your present trade or business, or Is part of a program of study that will qualify you for a new trade or business. Irs 1040ez form online You can deduct the expenses for qualifying work-related education even if the education could lead to a degree. Irs 1040ez form online Example 1. Irs 1040ez form online Lieutenant Colonel Mason has a degree in financial management and is in charge of base finances at her post of duty. Irs 1040ez form online She took an advanced finance course. Irs 1040ez form online She already meets the minimum qualifications for her job. Irs 1040ez form online By taking the course, she is improving skills in her current position. Irs 1040ez form online The course does not qualify her for a new trade or business. Irs 1040ez form online She can deduct educational expenses that are more than the educational allowance she received. Irs 1040ez form online Example 2. Irs 1040ez form online Major Williams worked in the military base legal office as a legal intern. Irs 1040ez form online He was placed in excess leave status by his employer to attend law school. Irs 1040ez form online He paid all his educational expenses and was not reimbursed. Irs 1040ez form online After obtaining his law degree, he passed the state bar exam and worked as a judge advocate. Irs 1040ez form online His educational expenses are not deductible because the law degree qualified him for a new trade or business, even though the education maintained and improved his skills in his work. Irs 1040ez form online Travel to obtain education. Irs 1040ez form online   If your work-related education qualifies, you can deduct the costs of travel, including meals (subject to the 50% limit), and lodging, if the main purpose of the trip is to obtain the education. Irs 1040ez form online   You cannot deduct the cost of travel that is itself a form of education, even if it is directly related to your duties in your work or business. Irs 1040ez form online Transportation for education. Irs 1040ez form online   If your work-related education qualifies for a deduction, you can deduct the costs of transportation to obtain that education. Irs 1040ez form online However, you cannot deduct the cost of services provided in kind, such as base-provided transportation to or from class. Irs 1040ez form online Transportation expenses include the actual costs of bus, subway, cab, or other fares, as well as the costs of using your car. Irs 1040ez form online   If you need more information on educational expenses, see Publication 970. Irs 1040ez form online Repayments If you had to repay to your employer an amount that you included in your income in an earlier year, you may be able to deduct the repaid amount from your income for the year in which you repaid it. Irs 1040ez form online Repayment of $3,000 or less. Irs 1040ez form online   If the amount you repaid was $3,000 or less, deduct it from your income in the year you repaid it. Irs 1040ez form online If you reported it as wages, deduct it as a miscellaneous itemized deduction on Schedule A (Form 1040), line 23. Irs 1040ez form online Repayment over $3,000. Irs 1040ez form online   If the amount you repaid was more than $3,000, see Repayments in Publication 525. Irs 1040ez form online Credits After you have figured your taxable income and tax liability, you can determine if you are entitled to any tax credits. Irs 1040ez form online This publication discusses the first-time homebuyer credit, child tax credit, earned income credit, and credit for excess social security tax withheld. Irs 1040ez form online For information on other credits, see your tax form instructions. Irs 1040ez form online First-Time Homebuyer Credit The first-time homebuyer credit is not available for homes purchased after 2011. Irs 1040ez form online In 2011, this credit had already expired for most taxpayers, however, certain members of the uniformed services and Foreign Service and certain employees of the intelligence community could claim the credit for homes purchased in 2011. Irs 1040ez form online If you bought the home (and claimed the credit) after 2008, you generally must repay the credit if you dispose of the home or the home stops being your main home within the 36-month period beginning on the purchase date. Irs 1040ez form online If the home continues to be your main home for at least 36 months beginning on the purchase date, you do not have to repay any of the credit. Irs 1040ez form online If you bought your home in 2008, you generally must repay the credit over a 15-year period in 15 equal installments. Irs 1040ez form online For more information, see Form 5405, Repayment of the First-Time Homebuyer Credit, and its instructions. Irs 1040ez form online Child Tax Credit The child tax credit is a credit that may reduce your tax by as much as $1,000 for each of your qualifying children. Irs 1040ez form online The additional child tax credit is a credit you may be able to take if you are not able to claim the full amount of the child tax credit. Irs 1040ez form online The child tax credit is not the same as the credit for child and dependent care expenses. Irs 1040ez form online See Publication 503 for information on the credit for child and dependent care expenses. Irs 1040ez form online Qualifying Child A qualifying child for purposes of the child tax credit is a child who: Is your son, daughter, stepchild, foster child, brother, sister, stepbrother, stepsister, half brother, half sister, or a descendant of any of them (for example, your grandchild, niece, or nephew), Was under age 17 at the end of 2013, Did not provide over half of his or her own support for 2013, Lived with you for more than half of 2013 (see Exceptions to time lived with you, later), Is claimed as a dependent on your return, Does not file a joint return for the year (or files it only as a claim for refund), and Was a U. Irs 1040ez form online S. Irs 1040ez form online citizen, a U. Irs 1040ez form online S. Irs 1040ez form online national, or a U. Irs 1040ez form online S. Irs 1040ez form online resident alien. Irs 1040ez form online If the child was adopted, see Adopted child . Irs 1040ez form online For each qualifying child you must check the box on Form 1040 or Form 1040A, line 6c, column (4). Irs 1040ez form online Exceptions to time lived with you. Irs 1040ez form online   A child is considered to have lived with you for all of 2013 if the child was born or died in 2013 and your home was this child's home for the entire time he or she was alive. Irs 1040ez form online Temporary absences by you or the child for special circumstances, such as school, vacation, business, medical care, military service, or detention in a juvenile facility, count as time the child lived with you. Irs 1040ez form online   There are also exceptions for kidnapped children and children of divorced or separated parents. Irs 1040ez form online For details, see Publication 501. Irs 1040ez form online Qualifying child of more than one person. Irs 1040ez form online   A special rule applies if your qualifying child is the qualifying child of more than one person. Irs 1040ez form online For details, see Publication 501. Irs 1040ez form online Adopted child. Irs 1040ez form online   An adopted child is always treated as your own child. Irs 1040ez form online An adopted child includes a child lawfully placed with you for legal adoption. Irs 1040ez form online   If you are a U. Irs 1040ez form online S. Irs 1040ez form online citizen or U. Irs 1040ez form online S. Irs 1040ez form online national and your adopted child lived with you as a member of your household all year, that child meets condition (7) above to be a qualifying child for the child tax credit. Irs 1040ez form online Amount of Credit The maximum amount you can claim for the credit is $1,000 for each qualifying child. Irs 1040ez form online Limits on the credit. Irs 1040ez form online   You must reduce your child tax credit if either (1) or (2), below, applies. Irs 1040ez form online The amount on Form 1040, line 46, or Form 1040A, line 28, is less than the credit. Irs 1040ez form online If the amount is zero, you cannot take this credit because there is no tax to reduce. Irs 1040ez form online However, you may be able to take the additional child tax credit. Irs 1040ez form online See Additional Child Tax Credit , later. Irs 1040ez form online Your modified adjusted gross income (AGI) is more than the amount shown below for your filing status. Irs 1040ez form online Married filing jointly — $110,000. Irs 1040ez form online Single, head of household,  or qualifying widow(er) — $75,000. Irs 1040ez form online Married filing separately — $55,000. Irs 1040ez form online Modified AGI. Irs 1040ez form online   For purposes of the child tax credit, your modified AGI is the amount on Form 1040, line 38, or Form 1040A, line 22, plus the following amounts that may apply to you. Irs 1040ez form online Any amount excluded from income because of the exclusion of income from Puerto Rico. Irs 1040ez form online Any amount on line 45 or line 50 of Form 2555, Foreign Earned Income. Irs 1040ez form online Any amount on line 18 of Form 2555-EZ, Foreign Earned Income Exclusion. Irs 1040ez form online Any amount on line 15 of Form 4563, Exclusion of Income for Bona Fide Residents of American Samoa. Irs 1040ez form online   If you do not have any of the above, your modified AGI is the same as your AGI. Irs 1040ez form online Claiming the Credit To claim the child tax credit, you must file Form 1040 or Form 1040A. Irs 1040ez form online For more information on the child tax credit, see the instructions for Form 1040 or Form 1040A. Irs 1040ez form online Also attach Schedule 8812, Child Tax Credit, if required. Irs 1040ez form online Additional Child Tax Credit This credit is for certain individuals who get less than the full amount of the child tax credit. Irs 1040ez form online The additional child tax credit may give you a refund even if you do not owe any tax. Irs 1040ez form online For more information, see the instructions for Form 1040 or Form 1040A, and Schedule 8812. Irs 1040ez form online Earned Income Credit The earned income credit (EIC) is a cr