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Irs Amended Tax Return Form

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Irs Amended Tax Return Form

Irs amended tax return form Publication 17 - Introductory Material Table of Contents What's New Reminders IntroductionIcons. Irs amended tax return form Ordering forms and publications. Irs amended tax return form Tax questions. Irs amended tax return form All material in this publication may be reprinted freely. Irs amended tax return form A citation to Your Federal Income Tax (2013) would be appropriate. Irs amended tax return form The explanations and examples in this publication reflect the interpretation by the Internal Revenue Service (IRS) of: Tax laws enacted by Congress, Treasury regulations, and Court decisions. Irs amended tax return form However, the information given does not cover every situation and is not intended to replace the law or change its meaning. Irs amended tax return form This publication covers some subjects on which a court may have made a decision more favorable to taxpayers than the interpretation by the IRS. Irs amended tax return form Until these differing interpretations are resolved by higher court decisions or in some other way, this publication will continue to present the interpretations by the IRS. Irs amended tax return form All taxpayers have important rights when working with the IRS. Irs amended tax return form These rights are described in Your Rights as a Taxpayer in the back of this publication. Irs amended tax return form What's New This section summarizes important tax changes that took effect in 2013. Irs amended tax return form Most of these changes are discussed in more detail throughout this publication. Irs amended tax return form Future developments. Irs amended tax return form  For the latest information about the tax law topics covered in this publication, including information about any tax legislation, go to www. Irs amended tax return form irs. Irs amended tax return form gov/pub17. Irs amended tax return form Additional Medicare Tax. Irs amended tax return form  Beginning in 2013, a 0. Irs amended tax return form 9% Additional Medicare Tax applies to Medicare wages, railroad retirement (RRTA) compensation, and self-employment income that are more than: $125,000 if married filing separately, $250,000 if married filing jointly, or $200,000 for any other filing status. Irs amended tax return form See Form 8959 and its instructions. Irs amended tax return form Net Investment Income Tax. Irs amended tax return form  Beginning in 2013, you may be subject to Net Investment Income Tax (NIIT). Irs amended tax return form The NIIT is 3. Irs amended tax return form 8% of the smaller of (a) your net investment income or (b) the excess of your modified adjusted gross income over: $125,000 if married filing separately, $250,000 if married filing jointly or qualifying widow(er), or $200,000 if any other filing status. Irs amended tax return form See Form 8960 and its instructions. Irs amended tax return form Change in tax rates. Irs amended tax return form  The highest tax rate is 39. Irs amended tax return form 6%. Irs amended tax return form For more information, see the 2013 Tax Computation Worksheet or the 2013 Tax Rate Schedules near the end of this publication. Irs amended tax return form Tax rate on net capital gain and qualified dividends. Irs amended tax return form  The maximum tax rate of 15% on net capital gain and qualified dividends has increased to 20% for some taxpayers. Irs amended tax return form See chapter 16. Irs amended tax return form Medical and dental expenses. Irs amended tax return form  You can deduct only the part of your medical and dental expenses that is more than 10% of your adjusted gross income (7. Irs amended tax return form 5% if either you or your spouse is age 65 or older). Irs amended tax return form See chapter 21. Irs amended tax return form Personal exemption amount increased for certain taxpayers. Irs amended tax return form  Your personal exemption is increased to $3,900. Irs amended tax return form But the amount is reduced if your adjusted gross income is more than: $150,000 if married filing separately, $250,000 if single, $275,000 if head of household, or $300,000 if any other filing status. Irs amended tax return form See chapter 3. Irs amended tax return form Limit on itemized deductions. Irs amended tax return form  You may not be able to deduct all of your itemized deductions if your adjusted gross income is more than: $150,000 if married filing separately, $250,000 if single, $275,000 if head of household, or $300,000 if any other filing status. Irs amended tax return form See chapter 29. Irs amended tax return form Same-sex marriages. Irs amended tax return form  If you have a same-sex spouse whom you legally married in a state (or foreign country) that recognizes same-sex marriage, you and your spouse generally must use the married filing jointly or married filing separately filing status on your 2013 return, even if you and your spouse now live in a state (or foreign country) that does not recognize same-sex marriage. Irs amended tax return form See chapter 2. Irs amended tax return form If you meet certain requirements, you may be able to file amended returns to change your filing status for some earlier years. Irs amended tax return form For details on filing amended returns, see chapter 1. Irs amended tax return form Health flexible spending arrangements (FSAs). Irs amended tax return form  You cannot have more than $2,500 in salary reduction contributions made to a health FSA for plan years beginning after 2012. Irs amended tax return form See chapter 5. Irs amended tax return form Expiring credits. Irs amended tax return form  The plug-in electric vehicle credit and the refundable part of the credit for prior year minimum tax have expired. Irs amended tax return form You cannot claim either one on your 2013 return. Irs amended tax return form See chapter 37. Irs amended tax return form Ponzi-type investment schemes. Irs amended tax return form  There are new rules for how to claim a theft loss deduction on Form 4684 due to a Ponzi-type investment scheme. Irs amended tax return form See chapter 25. Irs amended tax return form Home office deduction simplified method. Irs amended tax return form  If you can take a home office deduction, you may be able to use a simplified method to figure it. Irs amended tax return form See Publication 587. Irs amended tax return form Standard mileage rates. Irs amended tax return form  The 2013 rate for business use of your car is increased to 56½ cents a mile. Irs amended tax return form See chapter 26. Irs amended tax return form The 2013 rate for use of your car to get medical care is increased to 24 cents a mile. Irs amended tax return form See chapter 21. Irs amended tax return form The 2013 rate for use of your car to move is increased to 24 cents a mile. Irs amended tax return form See Publication 521, Moving Expenses. Irs amended tax return form Reminders Listed below are important reminders and other items that may help you file your 2013 tax return. Irs amended tax return form Many of these items are explained in more detail later in this publication. Irs amended tax return form Enter your social security number (SSN). Irs amended tax return form  Enter your SSN in the space provided on your tax form. Irs amended tax return form If you filed a joint return for 2012 and are filing a joint return for 2013 with the same spouse, enter your names and SSNs in the same order as on your 2012 return. Irs amended tax return form See chapter 1. Irs amended tax return form Secure your tax records from identity theft. Irs amended tax return form  Identity theft occurs when someone uses your personal information, such as your name, SSN, or other identifying information, without your permission, to commit fraud or other crimes. Irs amended tax return form An identity thief may use your SSN to get a job or may file a tax return using your SSN to receive a refund. Irs amended tax return form For more information about identity theft and how to reduce your risk from it, see chapter 1. Irs amended tax return form Taxpayer identification numbers. Irs amended tax return form  You must provide the taxpayer identification number for each person for whom you claim certain tax benefits. Irs amended tax return form This applies even if the person was born in 2013. Irs amended tax return form Generally, this number is the person's social security number (SSN). Irs amended tax return form See chapter 1. Irs amended tax return form Foreign source income. Irs amended tax return form  If you are a U. Irs amended tax return form S. Irs amended tax return form citizen with income from sources outside the United States (foreign income), you must report all such income on your tax return unless it is exempt by U. Irs amended tax return form S. Irs amended tax return form law. Irs amended tax return form This is true whether you live inside or outside the United States and whether or not you receive a Form W-2 or Form 1099 from the foreign payer. Irs amended tax return form 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 amended tax return form If you live outside the United States, you may be able to exclude part or all of your foreign source earned income. Irs amended tax return form For details, see Publication 54, Tax Guide for U. Irs amended tax return form S. Irs amended tax return form Citizens and Resident Aliens Abroad. Irs amended tax return form Foreign financial assets. Irs amended tax return form  If you had foreign financial assets in 2013, you may have to file Form 8938 with your return. Irs amended tax return form Check www. Irs amended tax return form IRS. Irs amended tax return form gov/form8938 for details. Irs amended tax return form Automatic 6-month extension to file tax return. Irs amended tax return form  You can use Form 4868, Application for Automatic Extension of Time To File U. Irs amended tax return form S. Irs amended tax return form Individual Income Tax Return, to obtain an automatic 6-month extension of time to file your tax return. Irs amended tax return form See chapter 1. Irs amended tax return form Include your phone number on your return. Irs amended tax return form  To promptly resolve any questions we have in processing your tax return, we would like to be able to call you. Irs amended tax return form Please enter your daytime telephone number on your tax form next to your signature and occupation. Irs amended tax return form If you are filing a joint return, you can enter either your or your spouse's daytime phone number. Irs amended tax return form Payment of taxes. Irs amended tax return form   You can pay your taxes online, by phone, or by check or money order. Irs amended tax return form You can make a direct transfer from your bank account or use a credit or debit card. Irs amended tax return form If you e-file, you can schedule an electronic payment. Irs amended tax return form See chapter 1. Irs amended tax return form Faster ways to file your return. Irs amended tax return form  The IRS offers fast, accurate ways to file your tax return information without filing a paper tax return. Irs amended tax return form You can use IRS e-file (electronic filing). Irs amended tax return form See chapter 1. Irs amended tax return form Free electronic filing. Irs amended tax return form  You may be able to file your 2013 taxes online for free. Irs amended tax return form See chapter 1. Irs amended tax return form Change of address. Irs amended tax return form  If you change your address, you should notify the IRS. Irs amended tax return form See Change of Address in chapter 1. Irs amended tax return form Refund on a late filed return. Irs amended tax return form  If you were due a refund but you did not file a return, you generally must file your return within 3 years from the date the return was due (including extensions) to get that refund. Irs amended tax return form See chapter 1. Irs amended tax return form Frivolous tax returns. Irs amended tax return form  The IRS has published a list of positions that are identified as frivolous. Irs amended tax return form The penalty for filing a frivolous tax return is $5,000. Irs amended tax return form See chapter 1. Irs amended tax return form Filing erroneous claim for refund or credit. Irs amended tax return form  You may have to pay a penalty if you file an erroneous claim for refund or credit. Irs amended tax return form See chapter 1. Irs amended tax return form Privacy Act and paperwork reduction information. Irs amended tax return form   The IRS Restructuring and Reform Act of 1998, the Privacy Act of 1974, and the Paperwork Reduction Act of 1980 require that when we ask you for information we must first tell you what our legal right is to ask for the information, why we are asking for it, how it will be used, what could happen if we do not receive it, and whether your response is voluntary, required to obtain a benefit, or mandatory under the law. Irs amended tax return form A complete statement on this subject can be found in your tax form instructions. Irs amended tax return form Customer service for taxpayers. Irs amended tax return form  You can set up a personal appointment at the most convenient Taxpayer Assistance Center, on the most convenient business day. Irs amended tax return form See How To Get Tax Help in the back of this publication. Irs amended tax return form Preparer e-file mandate. Irs amended tax return form  Most paid preparers must e-file returns they prepare and file. Irs amended tax return form Your preparer may make you aware of this requirement and the options available to you. Irs amended tax return form Treasury Inspector General for Tax Administration. Irs amended tax return form   If you want to confidentially report misconduct, waste, fraud, or abuse by an IRS employee, you can call 1-800-366-4484 (call 1-800-877-8339 if you are deaf, hard of hearing, or have a speech disability, and are using TTY/TDD equipment). Irs amended tax return form You can remain anonymous. Irs amended tax return form Photographs of missing children. Irs amended tax return form  The Internal Revenue Service is a proud partner with the National Center for Missing and Exploited Children. Irs amended tax return form Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. Irs amended tax return form You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child. Irs amended tax return form Introduction This publication covers the general rules for filing a federal income tax return. Irs amended tax return form It supplements the information contained in your tax form instructions. Irs amended tax return form It explains the tax law to make sure you pay only the tax you owe and no more. Irs amended tax return form How this publication is arranged. Irs amended tax return form   This publication closely follows Form 1040, U. Irs amended tax return form S. Irs amended tax return form Individual Income Tax Return. Irs amended tax return form It is divided into six parts which cover different sections of Form 1040. Irs amended tax return form Each part is further divided into chapters which generally discuss one line of the form. Irs amended tax return form Do not worry if you file Form 1040A or Form 1040EZ. Irs amended tax return form Anything included on a line of either of these forms is also included on Form 1040. Irs amended tax return form   The table of contents inside the front cover and the index in the back of the publication are useful tools to help you find the information you need. Irs amended tax return form What is in this publication. Irs amended tax return form   The publication begins with the rules for filing a tax return. Irs amended tax return form It explains: Who must file a return, Which tax form to use, When the return is due, How to e-file your return, and Other general information. Irs amended tax return form It will help you identify which filing status you qualify for, whether you can claim any dependents, and whether the income you receive is taxable. Irs amended tax return form The publication goes on to explain the standard deduction, the kinds of expenses you may be able to deduct, and the various kinds of credits you may be able to take to reduce your tax. Irs amended tax return form   Throughout the publication are examples showing how the tax law applies in typical situations. Irs amended tax return form Also throughout the publication are flowcharts and tables that present tax information in an easy-to-understand manner. Irs amended tax return form   Many of the subjects discussed in this publication are discussed in greater detail in other IRS publications. Irs amended tax return form References to those other publications are provided for your information. Irs amended tax return form Icons. Irs amended tax return form   Small graphic symbols, or icons, are used to draw your attention to special information. Irs amended tax return form See Table 1 later for an explanation of each icon used in this publication. Irs amended tax return form What is not covered in this publication. Irs amended tax return form   Some material that you may find helpful is not included in this publication but can be found in your tax form instruction booklet. Irs amended tax return form This includes lists of: Where to report certain items shown on information documents, and Recorded tax information topics (TeleTax). Irs amended tax return form   If you operate your own business or have other self-employment income, such as from babysitting or selling crafts, see the following publications for more information. Irs amended tax return form Publication 334, Tax Guide for Small Business (For Individuals Who Use Schedule C or C-EZ). Irs amended tax return form Publication 535, Business Expenses. Irs amended tax return form Publication 587, Business Use of Your Home (Including Use by Daycare Providers). Irs amended tax return form Help from the IRS. Irs amended tax return form   There are many ways you can get help from the IRS. Irs amended tax return form These are explained under How To Get Tax Help in the back of this publication. Irs amended tax return form Comments and suggestions. Irs amended tax return form   We welcome your comments about this publication and your suggestions for future editions. Irs amended tax return form   You can write to us at the following address: Internal Revenue Service Tax Forms and Publications Division 1111 Constitution Ave. Irs amended tax return form NW, IR-6526 Washington, DC 20224   We respond to many letters by telephone. Irs amended tax return form Therefore, it would be helpful if you would include your daytime phone number, including the area code, in your correspondence. Irs amended tax return form   You can send your comments from www. Irs amended tax return form irs. Irs amended tax return form gov/formspubs/. Irs amended tax return form Click on “More Information” and then on “Comment on Tax Forms and Publications”. Irs amended tax return form   Although we cannot respond individually to each comment received, we do appreciate your feedback and will consider your comments as we revise our tax products. Irs amended tax return form Ordering forms and publications. Irs amended tax return form   Visit www. Irs amended tax return form irs. Irs amended tax return form gov/formspubs/ to download forms and publications, call 1-800-TAX-FORM (1-800-829-3676), or write to the address below and receive a response within 10 days after your request is received. Irs amended tax return form Internal Revenue Service 1201 N. Irs amended tax return form Mitsubishi Motorway Bloomington, IL 61705-6613 Tax questions. Irs amended tax return form   If you have a tax question, check the information available on IRS. Irs amended tax return form gov or call 1-800-829-1040. Irs amended tax return form We cannot answer tax questions sent to either of the above addresses. Irs amended tax return form IRS mission. Irs amended tax return form   Provide America's taxpayers top quality service by helping them understand and meet their tax responsibilities and by applying the tax law with integrity and fairness to all. Irs amended tax return form Table 1. Irs amended tax return form Legend of Icons Icon Explanation Items that may cause you particular problems, or an alert about pending legislation that may be enacted after this publication goes to print. Irs amended tax return form An Internet site or an email address. Irs amended tax return form An address you may need. Irs amended tax return form Items you should keep in your personal records. Irs amended tax return form Items you may need to figure or a worksheet you may need to complete and keep for your records. Irs amended tax return form An important phone number. Irs amended tax return form Helpful information you may need. Irs amended tax return form Prev  Up  Next   Home   More Online Publications
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The Irs Amended Tax Return Form

Irs amended tax return form 5. Irs amended tax return form   Wages, Salaries, and Other Earnings Table of Contents Reminder Introduction Useful Items - You may want to see: Employee CompensationBabysitting. Irs amended tax return form Miscellaneous Compensation Fringe Benefits Retirement Plan Contributions Stock Options Restricted Property Special Rules for Certain EmployeesClergy Members of Religious Orders Foreign Employer Military Volunteers Sickness and Injury BenefitsDisability Pensions Long-Term Care Insurance Contracts Workers' Compensation Other Sickness and Injury Benefits Reminder Foreign income. Irs amended tax return form   If you are a U. Irs amended tax return form S. Irs amended tax return form citizen or resident alien, you must report income from sources outside the United States (foreign income) on your tax return unless it is exempt by U. Irs amended tax return form S. Irs amended tax return form law. Irs amended tax return form This is true whether you reside inside or outside the United States and whether or not you receive a Form W-2, Wage and Tax Statement, or Form 1099 from the foreign payer. Irs amended tax return form 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 amended tax return form If you reside outside the United States, you may be able to exclude part or all of your foreign source earned income. Irs amended tax return form For details, see Publication 54, Tax Guide for U. Irs amended tax return form S. Irs amended tax return form Citizens and Resident Aliens Abroad. Irs amended tax return form Introduction This chapter discusses compensation received for services as an employee, such as wages, salaries, and fringe benefits. Irs amended tax return form The following topics are included. Irs amended tax return form Bonuses and awards. Irs amended tax return form Special rules for certain employees. Irs amended tax return form Sickness and injury benefits. Irs amended tax return form The chapter explains what income is included in the employee's gross income and what is not included. Irs amended tax return form Useful Items - You may want to see: Publication 463 Travel, Entertainment, Gift, and Car Expenses 525 Taxable and Nontaxable Income Employee Compensation This section discusses various types of employee compensation including fringe benefits, retirement plan contributions, stock options, and restricted property. Irs amended tax return form Form W-2. Irs amended tax return form    If you are an employee, you should receive Form W-2 from your employer showing the pay you received for your services. Irs amended tax return form Include your pay on line 7 of Form 1040 or Form 1040A, or on line 1 of Form 1040EZ, even if you do not receive a Form W-2. Irs amended tax return form   If you performed services, other than as an independent contractor, and your employer did not withhold social security and Medicare taxes from your pay, you must file Form 8919, Uncollected Social Security and Medicare Tax on Wages, with your Form 1040. Irs amended tax return form These wages must be included on line 7 of Form 1040. Irs amended tax return form See Form 8919 for more information. Irs amended tax return form Childcare providers. Irs amended tax return form    If you provide childcare, either in the child's home or in your home or other place of business, the pay you receive must be included in your income. Irs amended tax return form If you are not an employee, you are probably self-employed and must include payments for your services on Schedule C (Form 1040), Profit or Loss From Business, or Schedule C-EZ (Form 1040), Net Profit From Business. Irs amended tax return form You generally are not an employee unless you are subject to the will and control of the person who employs you as to what you are to do and how you are to do it. Irs amended tax return form Babysitting. Irs amended tax return form   If you babysit for relatives or neighborhood children, whether on a regular basis or only periodically, the rules for childcare providers apply to you. Irs amended tax return form Miscellaneous Compensation This section discusses different types of employee compensation. Irs amended tax return form Advance commissions and other earnings. Irs amended tax return form   If you receive advance commissions or other amounts for services to be performed in the future and you are a cash-method taxpayer, you must include these amounts in your income in the year you receive them. Irs amended tax return form    If you repay unearned commissions or other amounts in the same year you receive them, reduce the amount included in your income by the repayment. Irs amended tax return form If you repay them in a later tax year, you can deduct the repayment as an itemized deduction on your Schedule A (Form 1040), or you may be able to take a credit for that year. Irs amended tax return form See Repayments in chapter 12. Irs amended tax return form Allowances and reimbursements. Irs amended tax return form    If you receive travel, transportation, or other business expense allowances or reimbursements from your employer, see Publication 463. Irs amended tax return form If you are reimbursed for moving expenses, see Publication 521, Moving Expenses. Irs amended tax return form Back pay awards. Irs amended tax return form    Include in income amounts you are awarded in a settlement or judgment for back pay. Irs amended tax return form These include payments made to you for damages, unpaid life insurance premiums, and unpaid health insurance premiums. Irs amended tax return form They should be reported to you by your employer on Form W-2. Irs amended tax return form Bonuses and awards. Irs amended tax return form   Bonuses or awards you receive for outstanding work are included in your income and should be shown on your Form W-2. Irs amended tax return form These include prizes such as vacation trips for meeting sales goals. Irs amended tax return form If the prize or award you receive is goods or services, you must include the fair market value of the goods or services in your income. Irs amended tax return form However, if your employer merely promises to pay you a bonus or award at some future time, it is not taxable until you receive it or it is made available to you. Irs amended tax return form Employee achievement award. Irs amended tax return form   If you receive tangible personal property (other than cash, a gift certificate, or an equivalent item) as an award for length of service or safety achievement, you generally can exclude its value from your income. Irs amended tax return form However, the amount you can exclude is limited to your employer's cost and cannot be more than $1,600 ($400 for awards that are not qualified plan awards) for all such awards you receive during the year. Irs amended tax return form Your employer can tell you whether your award is a qualified plan award. Irs amended tax return form Your employer must make the award as part of a meaningful presentation, under conditions and circumstances that do not create a significant likelihood of it being disguised pay. Irs amended tax return form   However, the exclusion does not apply to the following awards: A length-of-service award if you received it for less than 5 years of service or if you received another length-of-service award during the year or the previous 4 years. Irs amended tax return form A safety achievement award if you are a manager, administrator, clerical employee, or other professional employee or if more than 10% of eligible employees previously received safety achievement awards during the year. Irs amended tax return form Example. Irs amended tax return form Ben Green received three employee achievement awards during the year: a nonqualified plan award of a watch valued at $250, and two qualified plan awards of a stereo valued at $1,000 and a set of golf clubs valued at $500. Irs amended tax return form Assuming that the requirements for qualified plan awards are otherwise satisfied, each award by itself would be excluded from income. Irs amended tax return form However, because the $1,750 total value of the awards is more than $1,600, Ben must include $150 ($1,750 – $1,600) in his income. Irs amended tax return form Differential wage payments. Irs amended tax return form   This is any payment made to you by an employer for any period during which you are, for a period of more than 30 days, an active duty member of the uniformed services and represents all or a portion of the wages you would have received from the employer during that period. Irs amended tax return form These payments are treated as wages and are subject to income tax withholding, but not FICA or FUTA taxes. Irs amended tax return form The payments are reported as wages on Form W-2. Irs amended tax return form Government cost-of-living allowances. Irs amended tax return form   Most payments received by U. Irs amended tax return form S. Irs amended tax return form Government civilian employees for working abroad are taxable. Irs amended tax return form However, certain cost-of-living allowances are tax free. Irs amended tax return form Publication 516, U. Irs amended tax return form S. Irs amended tax return form Government Civilian Employees Stationed Abroad, explains the tax treatment of allowances, differentials, and other special pay you receive for employment abroad. Irs amended tax return form Nonqualified deferred compensation plans. Irs amended tax return form   Your employer will report to you the total amount of deferrals for the year under a nonqualified deferred compensation plan. Irs amended tax return form This amount is shown on Form W-2, box 12, using code Y. Irs amended tax return form This amount is not included in your income. Irs amended tax return form   However, if at any time during the tax year, the plan fails to meet certain requirements, or is not operated under those requirements, all amounts deferred under the plan for the tax year and all preceding tax years are included in your income for the current year. Irs amended tax return form This amount is included in your wages shown on Form W-2, box 1. Irs amended tax return form It is also shown on Form W-2, box 12, using code Z. Irs amended tax return form Note received for services. Irs amended tax return form    If your employer gives you a secured note as payment for your services, you must include the fair market value (usually the discount value) of the note in your income for the year you receive it. Irs amended tax return form When you later receive payments on the note, a proportionate part of each payment is the recovery of the fair market value that you previously included in your income. Irs amended tax return form Do not include that part again in your income. Irs amended tax return form Include the rest of the payment in your income in the year of payment. Irs amended tax return form   If your employer gives you a nonnegotiable unsecured note as payment for your services, payments on the note that are credited toward the principal amount of the note are compensation income when you receive them. Irs amended tax return form Severance pay. Irs amended tax return form   You must include in income amounts you receive as severance pay and any payment for the cancellation of your employment contract. Irs amended tax return form Accrued leave payment. Irs amended tax return form    If you are a federal employee and receive a lump-sum payment for accrued annual leave when you retire or resign, this amount will be included as wages on your Form W-2. Irs amended tax return form   If you resign from one agency and are reemployed by another agency, you may have to repay part of your lump-sum annual leave payment to the second agency. Irs amended tax return form You can reduce gross wages by the amount you repaid in the same tax year in which you received it. Irs amended tax return form Attach to your tax return a copy of the receipt or statement given to you by the agency you repaid to explain the difference between the wages on the return and the wages on your Forms W-2. Irs amended tax return form Outplacement services. Irs amended tax return form   If you choose to accept a reduced amount of severance pay so that you can receive outplacement services (such as training in résumé writing and interview techniques), you must include the unreduced amount of the severance pay in income. Irs amended tax return form    However, you can deduct the value of these outplacement services (up to the difference between the severance pay included in income and the amount actually received) as a miscellaneous deduction (subject to the 2%-of-adjusted-gross-income (AGI) limit) on Schedule A (Form 1040). Irs amended tax return form Sick pay. Irs amended tax return form   Pay you receive from your employer while you are sick or injured is part of your salary or wages. Irs amended tax return form In addition, you must include in your income sick pay benefits received from any of the following payers: A welfare fund. Irs amended tax return form A state sickness or disability fund. Irs amended tax return form An association of employers or employees. Irs amended tax return form An insurance company, if your employer paid for the plan. Irs amended tax return form However, if you paid the premiums on an accident or health insurance policy, the benefits you receive under the policy are not taxable. Irs amended tax return form For more information, see Publication 525. Irs amended tax return form Social security and Medicare taxes paid by employer. Irs amended tax return form   If you and your employer have an agreement that your employer pays your social security and Medicare taxes without deducting them from your gross wages, you must report the amount of tax paid for you as taxable wages on your tax return. Irs amended tax return form The payment also is treated as wages for figuring your social security and Medicare taxes and your social security and Medicare benefits. Irs amended tax return form However, these payments are not treated as social security and Medicare wages if you are a household worker or a farm worker. Irs amended tax return form Stock appreciation rights. Irs amended tax return form   Do not include a stock appreciation right granted by your employer in income until you exercise (use) the right. Irs amended tax return form When you use the right, you are entitled to a cash payment equal to the fair market value of the corporation's stock on the date of use minus the fair market value on the date the right was granted. Irs amended tax return form You include the cash payment in your income in the year you use the right. Irs amended tax return form Fringe Benefits Fringe benefits received in connection with the performance of your services are included in your income as compensation unless you pay fair market value for them or they are specifically excluded by law. Irs amended tax return form Abstaining from the performance of services (for example, under a covenant not to compete) is treated as the performance of services for purposes of these rules. Irs amended tax return form Accounting period. Irs amended tax return form   You must use the same accounting period your employer uses to report your taxable noncash fringe benefits. Irs amended tax return form Your employer has the option to report taxable noncash fringe benefits by using either of the following rules. Irs amended tax return form The general rule: benefits are reported for a full calendar year (January 1–December 31). Irs amended tax return form The special accounting period rule: benefits provided during the last 2 months of the calendar year (or any shorter period) are treated as paid during the following calendar year. Irs amended tax return form For example, each year your employer reports the value of benefits provided during the last 2 months of the prior year and the first 10 months of the current year. Irs amended tax return form  Your employer does not have to use the same accounting period for each fringe benefit, but must use the same period for all employees who receive a particular benefit. Irs amended tax return form   You must use the same accounting period that you use to report the benefit to claim an employee business deduction (for use of a car, for example). Irs amended tax return form Form W-2. Irs amended tax return form   Your employer must include all taxable fringe benefits in box 1 of Form W-2 as wages, tips, and other compensation and, if applicable, in boxes 3 and 5 as social security and Medicare wages. Irs amended tax return form Although not required, your employer may include the total value of fringe benefits in box 14 (or on a separate statement). Irs amended tax return form However, if your employer provided you with a vehicle and included 100% of its annual lease value in your income, the employer must separately report this value to you in box 14 (or on a separate statement). Irs amended tax return form Accident or Health Plan In most cases, the value of accident or health plan coverage provided to you by your employer is not included in your income. Irs amended tax return form Benefits you receive from the plan may be taxable, as explained later under Sickness and Injury Benefits . Irs amended tax return form For information on the items covered in this section, other than Long-term care coverage, see Publication 969, Health Savings Accounts and Other Tax-Favored Health Plans. Irs amended tax return form Long-term care coverage. Irs amended tax return form    Contributions by your employer to provide coverage for long-term care services generally are not included in your income. Irs amended tax return form However, contributions made through a flexible spending or similar arrangement (such as a cafeteria plan) must be included in your income. Irs amended tax return form This amount will be reported as wages in box 1 of your Form W-2. Irs amended tax return form   Contributions you make to the plan are discussed in Publication 502, Medical and Dental Expenses. Irs amended tax return form Archer MSA contributions. Irs amended tax return form    Contributions by your employer to your Archer MSA generally are not included in your income. Irs amended tax return form Their total will be reported in box 12 of Form W-2 with code R. Irs amended tax return form You must report this amount on Form 8853, Archer MSAs and Long-Term Care Insurance Contracts. Irs amended tax return form File the form with your return. Irs amended tax return form Health flexible spending arrangement (health FSA). Irs amended tax return form   If your employer provides a health FSA that qualifies as an accident or health plan, the amount of your salary reduction, and reimbursements of your medical care expenses, in most cases, are not included in your income. Irs amended tax return form Note. Irs amended tax return form Health FSAs are subject to a $2,500 limit on salary reduction contributions for plan years beginning after 2012. Irs amended tax return form The $2,500 limit is subject to an inflation adjustment for plan years beginning after 2013. Irs amended tax return form For more information, see Notice 2012-40, 2012-26 I. Irs amended tax return form R. Irs amended tax return form B. Irs amended tax return form 1046, available at www. Irs amended tax return form irs. Irs amended tax return form gov/irb/2012-26 IRB/ar09. Irs amended tax return form html. Irs amended tax return form Health reimbursement arrangement (HRA). Irs amended tax return form   If your employer provides an HRA that qualifies as an accident or health plan, coverage and reimbursements of your medical care expenses generally are not included in your income. Irs amended tax return form Health savings accounts (HSA). Irs amended tax return form   If you are an eligible individual, you and any other person, including your employer or a family member, can make contributions to your HSA. Irs amended tax return form Contributions, other than employer contributions, are deductible on your return whether or not you itemize deductions. Irs amended tax return form Contributions made by your employer are not included in your income. Irs amended tax return form Distributions from your HSA that are used to pay qualified medical expenses are not included in your income. Irs amended tax return form Distributions not used for qualified medical expenses are included in your income. Irs amended tax return form See Publication 969 for the requirements of an HSA. Irs amended tax return form   Contributions by a partnership to a bona fide partner's HSA are not contributions by an employer. Irs amended tax return form The contributions are treated as a distribution of money and are not included in the partner's gross income. Irs amended tax return form Contributions by a partnership to a partner's HSA for services rendered are treated as guaranteed payments that are includible in the partner's gross income. Irs amended tax return form In both situations, the partner can deduct the contribution made to the partner's HSA. Irs amended tax return form   Contributions by an S corporation to a 2% shareholder-employee's HSA for services rendered are treated as guaranteed payments and are includible in the shareholder-employee's gross income. Irs amended tax return form The shareholder-employee can deduct the contribution made to the shareholder-employee's HSA. Irs amended tax return form Qualified HSA funding distribution. Irs amended tax return form   You can make a one-time distribution from your individual retirement account (IRA) to an HSA and you generally will not include any of the distribution in your income. Irs amended tax return form See Publication 590 for the requirements for these qualified HSA funding distributions. Irs amended tax return form Failure to maintain eligibility. Irs amended tax return form   If your HSA received qualified HSA distributions from a health FSA or HRA (discussed earlier) or a qualified HSA funding distribution, you must be an eligible individual for HSA purposes for the period beginning with the month in which the qualified distribution was made and ending on the last day of the 12th month following that month. Irs amended tax return form If you fail to be an eligible individual during this period, other than because of death or disability, you must include the distribution in your income for the tax year in which you become ineligible. Irs amended tax return form This income is also subject to an additional 10% tax. Irs amended tax return form Adoption Assistance You may be able to exclude from your income amounts paid or expenses incurred by your employer for qualified adoption expenses in connection with your adoption of an eligible child. Irs amended tax return form See the Instructions for Form 8839, Qualified Adoption Expenses, for more information. Irs amended tax return form Adoption benefits are reported by your employer in box 12 of Form W-2 with code T. Irs amended tax return form They also are included as social security and Medicare wages in boxes 3 and 5. Irs amended tax return form However, they are not included as wages in box 1. Irs amended tax return form To determine the taxable and nontaxable amounts, you must complete Part III of Form 8839. Irs amended tax return form File the form with your return. Irs amended tax return form De Minimis (Minimal) Benefits If your employer provides you with a product or service and the cost of it is so small that it would be unreasonable for the employer to account for it, the value is not included in your income. Irs amended tax return form In most cases, the value of benefits such as discounts at company cafeterias, cab fares home when working overtime, and company picnics are not included in your income. Irs amended tax return form Holiday gifts. Irs amended tax return form   If your employer gives you a turkey, ham, or other item of nominal value at Christmas or other holidays, do not include the value of the gift in your income. Irs amended tax return form However, if your employer gives you cash, a gift certificate, or a similar item that you can easily exchange for cash, you include the value of that gift as extra salary or wages regardless of the amount involved. Irs amended tax return form Educational Assistance You can exclude from your income up to $5,250 of qualified employer-provided educational assistance. Irs amended tax return form For more information, see Publication 970, Tax Benefits for Education. Irs amended tax return form Group-Term Life Insurance In most cases, the cost of up to $50,000 of group-term life insurance coverage provided to you by your employer (or former employer) is not included in your income. Irs amended tax return form However, you must include in income the cost of employer-provided insurance that is more than the cost of $50,000 of coverage reduced by any amount you pay toward the purchase of the insurance. Irs amended tax return form For exceptions, see Entire cost excluded , and Entire cost taxed , later. Irs amended tax return form If your employer provided more than $50,000 of coverage, the amount included in your income is reported as part of your wages in box 1 of your Form W-2. Irs amended tax return form Also, it is shown separately in box 12 with code C. Irs amended tax return form Group-term life insurance. Irs amended tax return form   This insurance is term life insurance protection (insurance for a fixed period of time) that: Provides a general death benefit, Is provided to a group of employees, Is provided under a policy carried by the employer, and Provides an amount of insurance to each employee based on a formula that prevents individual selection. Irs amended tax return form Permanent benefits. Irs amended tax return form   If your group-term life insurance policy includes permanent benefits, such as a paid-up or cash surrender value, you must include in your income, as wages, the cost of the permanent benefits minus the amount you pay for them. Irs amended tax return form Your employer should be able to tell you the amount to include in your income. Irs amended tax return form Accidental death benefits. Irs amended tax return form   Insurance that provides accidental or other death benefits but does not provide general death benefits (travel insurance, for example) is not group-term life insurance. Irs amended tax return form Former employer. Irs amended tax return form   If your former employer provided more than $50,000 of group-term life insurance coverage during the year, the amount included in your income is reported as wages in box 1 of Form W-2. Irs amended tax return form Also, it is shown separately in box 12 with code C. Irs amended tax return form Box 12 also will show the amount of uncollected social security and Medicare taxes on the excess coverage, with codes M and N. Irs amended tax return form You must pay these taxes with your income tax return. Irs amended tax return form Include them on line 60, Form 1040, and follow the instructions for line 60. Irs amended tax return form For more information, see the Instructions for Form 1040. Irs amended tax return form Two or more employers. Irs amended tax return form   Your exclusion for employer-provided group-term life insurance coverage cannot exceed the cost of $50,000 of coverage, whether the insurance is provided by a single employer or multiple employers. Irs amended tax return form If two or more employers provide insurance coverage that totals more than $50,000, the amounts reported as wages on your Forms W-2 will not be correct. Irs amended tax return form You must figure how much to include in your income. Irs amended tax return form Reduce the amount you figure by any amount reported with code C in box 12 of your Forms W-2, add the result to the wages reported in box 1, and report the total on your return. Irs amended tax return form Figuring the taxable cost. Irs amended tax return form   Use the following worksheet to figure the amount to include in your income. Irs amended tax return form     Worksheet 5-1. Irs amended tax return form Figuring the Cost of Group-Term Life Insurance To Include in Income 1. Irs amended tax return form Enter the total amount of your insurance coverage from your employer(s) 1. Irs amended tax return form   2. Irs amended tax return form Limit on exclusion for employer-provided group-term life insurance coverage 2. Irs amended tax return form 50,000 3. Irs amended tax return form Subtract line 2 from line 1 3. Irs amended tax return form   4. Irs amended tax return form Divide line 3 by $1,000. Irs amended tax return form Figure to the nearest tenth 4. Irs amended tax return form   5. Irs amended tax return form Go to Table 5-1. Irs amended tax return form Using your age on the last day of the tax year, find your age group in the left column, and enter the cost from the column on the right for your age group 5. Irs amended tax return form   6. Irs amended tax return form Multiply line 4 by line 5 6. Irs amended tax return form   7. Irs amended tax return form Enter the number of full months of coverage at this cost. Irs amended tax return form 7. Irs amended tax return form   8. Irs amended tax return form Multiply line 6 by line 7 8. Irs amended tax return form   9. Irs amended tax return form Enter the premiums you paid per month 9. Irs amended tax return form       10. Irs amended tax return form Enter the number of months you paid the premiums 10. Irs amended tax return form       11. Irs amended tax return form Multiply line 9 by line 10. Irs amended tax return form 11. Irs amended tax return form   12. Irs amended tax return form Subtract line 11 from line 8. Irs amended tax return form Include this amount in your income as wages 12. Irs amended tax return form      Table 5-1. Irs amended tax return form Cost of $1,000 of Group-Term Life Insurance for One Month Age Cost Under 25 $. Irs amended tax return form 05 25 through 29 . Irs amended tax return form 06 30 through 34 . Irs amended tax return form 08 35 through 39 . Irs amended tax return form 09 40 through 44 . Irs amended tax return form 10 45 through 49 . Irs amended tax return form 15 50 through 54 . Irs amended tax return form 23 55 through 59 . Irs amended tax return form 43 60 through 64 . Irs amended tax return form 66 65 through 69 1. Irs amended tax return form 27 70 and older 2. Irs amended tax return form 06 Example. Irs amended tax return form You are 51 years old and work for employers A and B. Irs amended tax return form Both employers provide group-term life insurance coverage for you for the entire year. Irs amended tax return form Your coverage is $35,000 with employer A and $45,000 with employer B. Irs amended tax return form You pay premiums of $4. Irs amended tax return form 15 a month under the employer B group plan. Irs amended tax return form You figure the amount to include in your income as shown in Worksheet 5-1. Irs amended tax return form Figuring the Cost of Group-Term Life Insurance to Include in Income—Illustrated, later. Irs amended tax return form Worksheet 5-1. Irs amended tax return form Figuring the Cost of Group-Term Life Insurance to Include in Income—Illustrated 1. Irs amended tax return form Enter the total amount of your insurance coverage from your employer(s) 1. Irs amended tax return form 80,000 2. Irs amended tax return form Limit on exclusion for employer-provided group-term life insurance coverage 2. Irs amended tax return form 50,000 3. Irs amended tax return form Subtract line 2 from line 1 3. Irs amended tax return form 30,000 4. Irs amended tax return form Divide line 3 by $1,000. Irs amended tax return form Figure to the nearest tenth 4. Irs amended tax return form 30. Irs amended tax return form 0 5. Irs amended tax return form Go to Table 5-1. Irs amended tax return form Using your age on the last day of the tax year, find your age group in the left column, and enter the cost from the column on the right for your age group 5. Irs amended tax return form . Irs amended tax return form 23 6. Irs amended tax return form Multiply line 4 by line 5 6. Irs amended tax return form 6. Irs amended tax return form 90 7. Irs amended tax return form Enter the number of full months of coverage at this cost. Irs amended tax return form 7. Irs amended tax return form 12 8. Irs amended tax return form Multiply line 6 by line 7 8. Irs amended tax return form 82. Irs amended tax return form 80 9. Irs amended tax return form Enter the premiums you paid per month 9. Irs amended tax return form 4. Irs amended tax return form 15     10. Irs amended tax return form Enter the number of months you paid the premiums 10. Irs amended tax return form 12     11. Irs amended tax return form Multiply line 9 by line 10. Irs amended tax return form 11. Irs amended tax return form 49. Irs amended tax return form 80 12. Irs amended tax return form Subtract line 11 from line 8. Irs amended tax return form Include this amount in your income as wages 12. Irs amended tax return form 33. Irs amended tax return form 00 Entire cost excluded. Irs amended tax return form   You are not taxed on the cost of group-term life insurance if any of the following circumstances apply. Irs amended tax return form You are permanently and totally disabled and have ended your employment. Irs amended tax return form Your employer is the beneficiary of the policy for the entire period the insurance is in force during the tax year. Irs amended tax return form A charitable organization (defined in chapter 24) to which contributions are deductible is the only beneficiary of the policy for the entire period the insurance is in force during the tax year. Irs amended tax return form (You are not entitled to a deduction for a charitable contribution for naming a charitable organization as the beneficiary of your policy. Irs amended tax return form ) The plan existed on January 1, 1984, and You retired before January 2, 1984, and were covered by the plan when you retired, or You reached age 55 before January 2, 1984, and were employed by the employer or its predecessor in 1983. Irs amended tax return form Entire cost taxed. Irs amended tax return form   You are taxed on the entire cost of group-term life insurance if either of the following circumstances apply: The insurance is provided by your employer through a qualified employees' trust, such as a pension trust or a qualified annuity plan. Irs amended tax return form You are a key employee and your employer's plan discriminates in favor of key employees. Irs amended tax return form Retirement Planning Services If your employer has a qualified retirement plan, qualified retirement planning services provided to you (and your spouse) by your employer are not included in your income. Irs amended tax return form Qualified services include retirement planning advice, information about your employer's retirement plan, and information about how the plan may fit into your overall individual retirement income plan. Irs amended tax return form You cannot exclude the value of any tax preparation, accounting, legal, or brokerage services provided by your employer. Irs amended tax return form Transportation If your employer provides you with a qualified transportation fringe benefit, it can be excluded from your income, up to certain limits. Irs amended tax return form A qualified transportation fringe benefit is: Transportation in a commuter highway vehicle (such as a van) between your home and work place, A transit pass, Qualified parking, or Qualified bicycle commuting reimbursement. Irs amended tax return form Cash reimbursement by your employer for these expenses under a bona fide reimbursement arrangement is also excludable. Irs amended tax return form However, cash reimbursement for a transit pass is excludable only if a voucher or similar item that can be exchanged only for a transit pass is not readily available for direct distribution to you. Irs amended tax return form Exclusion limit. Irs amended tax return form   The exclusion for commuter vehicle transportation and transit pass fringe benefits cannot be more than $245 a month. Irs amended tax return form   The exclusion for the qualified parking fringe benefit cannot be more than $245 a month. Irs amended tax return form   The exclusion for qualified bicycle commuting in a calendar year is $20 multiplied by the number of qualified bicycle commuting months that year. Irs amended tax return form   If the benefits have a value that is more than these limits, the excess must be included in your income. Irs amended tax return form You are not entitled to these exclusions if the reimbursements are made under a compensation reduction agreement. Irs amended tax return form Commuter highway vehicle. Irs amended tax return form   This is a highway vehicle that seats at least six adults (not including the driver). Irs amended tax return form At least 80% of the vehicle's mileage must reasonably be expected to be: For transporting employees between their homes and work place, and On trips during which employees occupy at least half of the vehicle's adult seating capacity (not including the driver). Irs amended tax return form Transit pass. Irs amended tax return form   This is any pass, token, farecard, voucher, or similar item entitling a person to ride mass transit (whether public or private) free or at a reduced rate or to ride in a commuter highway vehicle operated by a person in the business of transporting persons for compensation. Irs amended tax return form Qualified parking. Irs amended tax return form   This is parking provided to an employee at or near the employer's place of business. Irs amended tax return form It also includes parking provided on or near a location from which the employee commutes to work by mass transit, in a commuter highway vehicle, or by carpool. Irs amended tax return form It does not include parking at or near the employee's home. Irs amended tax return form Qualified bicycle commuting. Irs amended tax return form   This is reimbursement based on the number of qualified bicycle commuting months for the year. Irs amended tax return form A qualified bicycle commuting month is any month you use the bicycle regularly for a substantial portion of the travel between your home and place of employment and you do not receive any of the other qualified transportation fringe benefits. Irs amended tax return form The reimbursement can be for expenses you incurred during the year for the purchase of a bicycle and bicycle improvements, repair, and storage. Irs amended tax return form Retirement Plan Contributions Your employer's contributions to a qualified retirement plan for you are not included in income at the time contributed. Irs amended tax return form (Your employer can tell you whether your retirement plan is qualified. Irs amended tax return form ) However, the cost of life insurance coverage included in the plan may have to be included. Irs amended tax return form See Group-Term Life Insurance , earlier, under Fringe Benefits. Irs amended tax return form If your employer pays into a nonqualified plan for you, you generally must include the contributions in your income as wages for the tax year in which the contributions are made. Irs amended tax return form However, if your interest in the plan is not transferable or is subject to a substantial risk of forfeiture (you have a good chance of losing it) at the time of the contribution, you do not have to include the value of your interest in your income until it is transferable or is no longer subject to a substantial risk of forfeiture. Irs amended tax return form For information on distributions from retirement plans, see Publication 575, Pension and Annuity Income (or Publication 721, Tax Guide to U. Irs amended tax return form S. Irs amended tax return form Civil Service Retirement Benefits, if you are a federal employee or retiree). Irs amended tax return form Elective deferrals. Irs amended tax return form   If you are covered by certain kinds of retirement plans, you can choose to have part of your compensation contributed by your employer to a retirement fund, rather than have it paid to you. Irs amended tax return form The amount you set aside (called an elective deferral) is treated as an employer contribution to a qualified plan. Irs amended tax return form An elective deferral, other than a designated Roth contribution (discussed later), is not included in wages subject to income tax at the time contributed. Irs amended tax return form However, it is included in wages subject to social security and Medicare taxes. Irs amended tax return form   Elective deferrals include elective contributions to the following retirement plans. Irs amended tax return form Cash or deferred arrangements (section 401(k) plans). Irs amended tax return form The Thrift Savings Plan for federal employees. Irs amended tax return form Salary reduction simplified employee pension plans (SARSEP). Irs amended tax return form Savings incentive match plans for employees (SIMPLE plans). Irs amended tax return form Tax-sheltered annuity plans (403(b) plans). Irs amended tax return form Section 501(c)(18)(D) plans. Irs amended tax return form Section 457 plans. Irs amended tax return form Qualified automatic contribution arrangements. Irs amended tax return form   Under a qualified automatic contribution arrangement, your employer can treat you as having elected to have a part of your compensation contributed to a section 401(k) plan. Irs amended tax return form You are to receive written notice of your rights and obligations under the qualified automatic contribution arrangement. Irs amended tax return form The notice must explain: Your rights to elect not to have elective contributions made, or to have contributions made at a different percentage, and How contributions made will be invested in the absence of any investment decision by you. Irs amended tax return form   You must be given a reasonable period of time after receipt of the notice and before the first elective contribution is made to make an election with respect to the contributions. Irs amended tax return form Overall limit on deferrals. Irs amended tax return form   For 2013, in most cases, you should not have deferred more than a total of $17,500 of contributions to the plans listed in (1) through (3) and (5) above. Irs amended tax return form The limit for SIMPLE plans is $12,000. Irs amended tax return form The limit for section 501(c)(18)(D) plans is the lesser of $7,000 or 25% of your compensation. Irs amended tax return form The limit for section 457 plans is the lesser of your includible compensation or $17,500. Irs amended tax return form Amounts deferred under specific plan limits are part of the overall limit on deferrals. Irs amended tax return form Designated Roth contributions. Irs amended tax return form   Employers with section 401(k) and section 403(b) plans can create qualified Roth contribution programs so that you may elect to have part or all of your elective deferrals to the plan designated as after-tax Roth contributions. Irs amended tax return form Designated Roth contributions are treated as elective deferrals, except that they are included in income. Irs amended tax return form Excess deferrals. Irs amended tax return form   Your employer or plan administrator should apply the proper annual limit when figuring your plan contributions. Irs amended tax return form However, you are responsible for monitoring the total you defer to ensure that the deferrals are not more than the overall limit. Irs amended tax return form   If you set aside more than the limit, the excess generally must be included in your income for that year, unless you have an excess deferral of a designated Roth contribution. Irs amended tax return form See Publication 525 for a discussion of the tax treatment of excess deferrals. Irs amended tax return form Catch-up contributions. Irs amended tax return form   You may be allowed catch-up contributions (additional elective deferral) if you are age 50 or older by the end of your tax year. Irs amended tax return form Stock Options If you receive a nonstatutory option to buy or sell stock or other property as payment for your services, you usually will have income when you receive the option, when you exercise the option (use it to buy or sell the stock or other property), or when you sell or otherwise dispose of the option. Irs amended tax return form However, if your option is a statutory stock option, you will not have any income until you sell or exchange your stock. Irs amended tax return form Your employer can tell you which kind of option you hold. Irs amended tax return form For more information, see Publication 525. Irs amended tax return form Restricted Property In most cases, if you receive property for your services, you must include its fair market value in your income in the year you receive the property. Irs amended tax return form However, if you receive stock or other property that has certain restrictions that affect its value, you do not include the value of the property in your income until it has substantially vested. Irs amended tax return form (You can choose to include the value of the property in your income in the year it is transferred to you. Irs amended tax return form ) For more information, see Restricted Property in Publication 525. Irs amended tax return form Dividends received on restricted stock. Irs amended tax return form   Dividends you receive on restricted stock are treated as compensation and not as dividend income. Irs amended tax return form Your employer should include these payments on your Form W-2. Irs amended tax return form Stock you chose to include in income. Irs amended tax return form   Dividends you receive on restricted stock you chose to include in your income in the year transferred are treated the same as any other dividends. Irs amended tax return form Report them on your return as dividends. Irs amended tax return form For a discussion of dividends, see chapter 8. Irs amended tax return form    For information on how to treat dividends reported on both your Form W-2 and Form 1099-DIV, see Dividends received on restricted stock in Publication 525. Irs amended tax return form Special Rules for Certain Employees This section deals with special rules for people in certain types of employment: members of the clergy, members of religious orders, people working for foreign employers, military personnel, and volunteers. Irs amended tax return form Clergy Generally, if you are a member of the clergy, you must include in your income offerings and fees you receive for marriages, baptisms, funerals, masses, etc. Irs amended tax return form , in addition to your salary. Irs amended tax return form If the offering is made to the religious institution, it is not taxable to you. Irs amended tax return form If you are a member of a religious organization and you give your outside earnings to the religious organization, you still must include the earnings in your income. Irs amended tax return form However, you may be entitled to a charitable contribution deduction for the amount paid to the organization. Irs amended tax return form See chapter 24. Irs amended tax return form Pension. Irs amended tax return form    A pension or retirement pay for a member of the clergy usually is treated as any other pension or annuity. Irs amended tax return form It must be reported on lines 16a and 16b of Form 1040 or on lines 12a and 12b of Form 1040A. Irs amended tax return form Housing. Irs amended tax return form    Special rules for housing apply to members of the clergy. Irs amended tax return form Under these rules, you do not include in your income the rental value of a home (including utilities) or a designated housing allowance provided to you as part of your pay. Irs amended tax return form However, the exclusion cannot be more than the reasonable pay for your service. Irs amended tax return form If you pay for the utilities, you can exclude any allowance designated for utility cost, up to your actual cost. Irs amended tax return form The home or allowance must be provided as compensation for your services as an ordained, licensed, or commissioned minister. Irs amended tax return form However, you must include the rental value of the home or the housing allowance as earnings from self-employment on Schedule SE (Form 1040) if you are subject to the self-employment tax. Irs amended tax return form For more information, see Publication 517, Social Security and Other Information for Members of the Clergy and Religious Workers. Irs amended tax return form Members of Religious Orders If you are a member of a religious order who has taken a vow of poverty, how you treat earnings that you renounce and turn over to the order depends on whether your services are performed for the order. Irs amended tax return form Services performed for the order. Irs amended tax return form   If you are performing the services as an agent of the order in the exercise of duties required by the order, do not include in your income the amounts turned over to the order. Irs amended tax return form   If your order directs you to perform services for another agency of the supervising church or an associated institution, you are considered to be performing the services as an agent of the order. Irs amended tax return form Any wages you earn as an agent of an order that you turn over to the order are not included in your income. Irs amended tax return form Example. Irs amended tax return form You are a member of a church order and have taken a vow of poverty. Irs amended tax return form You renounce any claims to your earnings and turn over to the order any salaries or wages you earn. Irs amended tax return form You are a registered nurse, so your order assigns you to work in a hospital that is an associated institution of the church. Irs amended tax return form However, you remain under the general direction and control of the order. Irs amended tax return form You are considered to be an agent of the order and any wages you earn at the hospital that you turn over to your order are not included in your income. Irs amended tax return form Services performed outside the order. Irs amended tax return form   If you are directed to work outside the order, your services are not an exercise of duties required by the order unless they meet both of the following requirements: They are the kind of services that are ordinarily the duties of members of the order. Irs amended tax return form They are part of the duties that you must exercise for, or on behalf of, the religious order as its agent. Irs amended tax return form If you are an employee of a third party, the services you perform for the third party will not be considered directed or required of you by the order. Irs amended tax return form Amounts you receive for these services are included in your income, even if you have taken a vow of poverty. Irs amended tax return form Example. Irs amended tax return form Mark Brown is a member of a religious order and has taken a vow of poverty. Irs amended tax return form He renounces all claims to his earnings and turns over his earnings to the order. Irs amended tax return form Mark is a schoolteacher. Irs amended tax return form He was instructed by the superiors of the order to get a job with a private tax-exempt school. Irs amended tax return form Mark became an employee of the school, and, at his request, the school made the salary payments directly to the order. Irs amended tax return form Because Mark is an employee of the school, he is performing services for the school rather than as an agent of the order. Irs amended tax return form The wages Mark earns working for the school are included in his income. Irs amended tax return form Foreign Employer Special rules apply if you work for a foreign employer. Irs amended tax return form U. Irs amended tax return form S. Irs amended tax return form citizen. Irs amended tax return form   If you are a U. Irs amended tax return form S. Irs amended tax return form citizen who works in the United States for a foreign government, an international organization, a foreign embassy, or any foreign employer, you must include your salary in your income. Irs amended tax return form Social security and Medicare taxes. Irs amended tax return form   You are exempt from social security and Medicare employee taxes if you are employed in the United States by an international organization or a foreign government. Irs amended tax return form However, you must pay self-employment tax on your earnings from services performed in the United States, even though you are not self-employed. Irs amended tax return form This rule also applies if you are an employee of a qualifying wholly owned instrumentality of a foreign government. Irs amended tax return form Employees of international organizations or foreign governments. Irs amended tax return form   Your compensation for official services to an international organization is exempt from federal income tax if you are not a citizen of the United States or you are a citizen of the Philippines (whether or not you are a citizen of the United States). Irs amended tax return form   Your compensation for official services to a foreign government is exempt from federal income tax if all of the following are true. Irs amended tax return form You are not a citizen of the United States or you are a citizen of the Philippines (whether or not you are a citizen of the United States). Irs amended tax return form Your work is like the work done by employees of the United States in foreign countries. Irs amended tax return form The foreign government gives an equal exemption to employees of the United States in its country. Irs amended tax return form Waiver of alien status. Irs amended tax return form   If you are an alien who works for a foreign government or international organization and you file a waiver under section 247(b) of the Immigration and Nationality Act to keep your immigrant status, different rules may apply. Irs amended tax return form See Foreign Employer in Publication 525. Irs amended tax return form Employment abroad. Irs amended tax return form   For information on the tax treatment of income earned abroad, see Publication 54. Irs amended tax return form Military Payments you receive as a member of a military service generally are taxed as wages except for retirement pay, which is taxed as a pension. Irs amended tax return form Allowances generally are not taxed. Irs amended tax return form For more information on the tax treatment of military allowances and benefits, see Publication 3, Armed Forces' Tax Guide. Irs amended tax return form Differential wage payments. Irs amended tax return form   Any payments made to you by an employer during the time you are performing service in the uniformed services are treated as compensation. Irs amended tax return form These wages are subject to income tax withholding and are reported on a Form W-2. Irs amended tax return form See the discussion under Miscellaneous Compensation , earlier. Irs amended tax return form Military retirement pay. Irs amended tax return form   If your retirement pay is based on age or length of service, it is taxable and must be included in your income as a pension on lines 16a and 16b of Form 1040 or on lines 12a and 12b of Form 1040A. Irs amended tax return form Do not include in your income the amount of any reduction in retirement or retainer pay to provide a survivor annuity for your spouse or children under the Retired Serviceman's Family Protection Plan or the Survivor Benefit Plan. Irs amended tax return form   For more detailed discussion of survivor annuities, see chapter 10. Irs amended tax return form Disability. Irs amended tax return form   If you are retired on disability, see Military and Government Disability Pensions under Sickness and Injury Benefits, later. Irs amended tax return form Veterans' benefits. Irs amended tax return form   Do not include in your income any veterans' benefits paid under any law, regulation, or administrative practice administered by the Department of Veterans Affairs (VA). Irs amended tax return form The following amounts paid to veterans or their families are not taxable. Irs amended tax return form Education, training, and subsistence allowances. Irs amended tax return form Disability compensation and pension payments for disabilities paid either to veterans or their families. Irs amended tax return form Grants for homes designed for wheelchair living. Irs amended tax return form Grants for motor vehicles for veterans who lost their sight or the use of their limbs. Irs amended tax return form Veterans' insurance proceeds and dividends paid either to veterans or their beneficiaries, including the proceeds of a veteran's endowment policy paid before death. Irs amended tax return form Interest on insurance dividends you leave on deposit with the VA. Irs amended tax return form Benefits under a dependent-care assistance program. Irs amended tax return form The death gratuity paid to a survivor of a member of the Armed Forces who died after September 10, 2001. Irs amended tax return form Payments made under the compensated work therapy program. Irs amended tax return form Any bonus payment by a state or political subdivision because of service in a combat zone. Irs amended tax return form Volunteers The tax treatment of amounts you receive as a volunteer worker for the Peace Corps or similar agency is covered in the following discussions. Irs amended tax return form Peace Corps. Irs amended tax return form   Living allowances you receive as a Peace Corps volunteer or volunteer leader for housing, utilities, household supplies, food, and clothing are exempt from tax. Irs amended tax return form Taxable allowances. Irs amended tax return form   The following allowances must be included in your income and reported as wages: Allowances paid to your spouse and minor children while you are a volunteer leader training in the United States. Irs amended tax return form Living allowances designated by the Director of the Peace Corps as basic compensation. Irs amended tax return form These are allowances for personal items such as domestic help, laundry and clothing maintenance, entertainment and recreation, transportation, and other miscellaneous expenses. Irs amended tax return form Leave allowances. Irs amended tax return form Readjustment allowances or termination payments. Irs amended tax return form These are considered received by you when credited to your account. Irs amended tax return form Example. Irs amended tax return form Gary Carpenter, a Peace Corps volunteer, gets $175 a month as a readjustment allowance during his period of service, to be paid to him in a lump sum at the end of his tour of duty. Irs amended tax return form Although the allowance is not available to him until the end of his service, Gary must include it in his income on a monthly basis as it is credited to his account. Irs amended tax return form Volunteers in Service to America (VISTA). Irs amended tax return form   If you are a VISTA volunteer, you must include meal and lodging allowances paid to you in your income as wages. Irs amended tax return form National Senior Services Corps programs. Irs amended tax return form   Do not include in your income amounts you receive for supportive services or reimbursements for out-of-pocket expenses from the following programs. Irs amended tax return form Retired Senior Volunteer Program (RSVP). Irs amended tax return form Foster Grandparent Program. Irs amended tax return form Senior Companion Program. Irs amended tax return form Service Corps of Retired Executives (SCORE). Irs amended tax return form   If you receive amounts for supportive services or reimbursements for out-of-pocket expenses from SCORE, do not include these amounts in income. Irs amended tax return form Volunteer tax counseling. Irs amended tax return form   Do not include in your income any reimbursements you receive for transportation, meals, and other expenses you have in training for, or actually providing, volunteer federal income tax counseling for the elderly (TCE). Irs amended tax return form   You can deduct as a charitable contribution your unreimbursed out-of-pocket expenses in taking part in the volunteer income tax assistance (VITA) program. Irs amended tax return form See chapter 24. Irs amended tax return form Sickness and Injury Benefits This section discusses sickness and injury benefits including disability pensions, long-term care insurance contracts, workers' compensation, and other benefits. Irs amended tax return form In most cases, you must report as income any amount you receive for personal injury or sickness through an accident or health plan that is paid for by your employer. Irs amended tax return form If both you and your employer pay for the plan, only the amount you receive that is due to your employer's payments is reported as income. Irs amended tax return form However, certain payments may not be taxable to you. Irs amended tax return form Your employer should be able to give you specific details about your pension plan and tell you the amount you paid for your disability pension. Irs amended tax return form In addition to disability pensions and annuities, you may be receiving other payments for sickness and injury. Irs amended tax return form Do not report as income any amounts paid to reimburse you for medical expenses you incurred after the plan was established. Irs amended tax return form Cost paid by you. Irs amended tax return form   If you pay the entire cost of a health or accident insurance plan, do not include any amounts you receive from the plan for personal injury or sickness as income on your tax return. Irs amended tax return form If your plan reimbursed you for medical expenses you deducted in an earlier year, you may have to include some, or all, of the reimbursement in your income. Irs amended tax return form See Reimbursement in a later year in chapter 21. Irs amended tax return form Cafeteria plans. Irs amended tax return form   In most cases, if you are covered by an accident or health insurance plan through a cafeteria plan, and the amount of the insurance premiums was not included in your income, you are not considered to have paid the premiums and you must include any benefits you receive in your income. Irs amended tax return form If the amount of the premiums was included in your income, you are considered to have paid the premiums, and any benefits you receive are not taxable. Irs amended tax return form Disability Pensions If you retired on disability, you must include in income any disability pension you receive under a plan that is paid for by your employer. Irs amended tax return form You must report your taxable disability payments as wages on line 7 of Form 1040 or Form 1040A, until you reach minimum retirement age. Irs amended tax return form Minimum retirement age generally is the age at which you can first receive a pension or annuity if you are not disabled. Irs amended tax return form You may be entitled to a tax credit if you were permanently and totally disabled when you retired. Irs amended tax return form For information on this credit and the definition of permanent and total disability, see chapter 33. Irs amended tax return form Beginning on the day after you reach minimum retirement age, payments you receive are taxable as a pension or annuity. Irs amended tax return form Report the payments on lines 16a and 16b of Form 1040 or on lines 12a and 12b of Form 1040A. Irs amended tax return form The rules for reporting pensions are explained in How To Report in chapter 10. Irs amended tax return form For information on disability payments from a governmental program provided as a substitute for unemployment compensation, see chapter 12. Irs amended tax return form Retirement and profit-sharing plans. Irs amended tax return form   If you receive payments from a retirement or profit-sharing plan that does not provide for disability retirement, do not treat the payments as a disability pension. Irs amended tax return form The payments must be reported as a pension or annuity. Irs amended tax return form For more information on pensions, see chapter 10. Irs amended tax return form Accrued leave payment. Irs amended tax return form   If you retire on disability, any lump-sum payment you receive for accrued annual leave is a salary payment. Irs amended tax return form The payment is not a disability payment. Irs amended tax return form Include it in your income in the tax year you receive it. Irs amended tax return form Military and Government Disability Pensions Certain military and government disability pensions are not taxable. Irs amended tax return form Service-connected disability. Irs amended tax return form   You may be able to exclude from income amounts you receive as a pension, annuity, or similar allowance for personal injury or sickness resulting from active service in one of the following government services. Irs amended tax return form The armed forces of any country. Irs amended tax return form The National Oceanic and Atmospheric Administration. Irs amended tax return form The Public Health Service. Irs amended tax return form The Foreign Service. Irs amended tax return form Conditions for exclusion. Irs amended tax return form   Do not include the disability payments in your income if any of the following conditions apply. Irs amended tax return form You were entitled to receive a disability payment before September 25, 1975. Irs amended tax return form You were a member of a listed government service or its reserve component, or were under a binding written commitment to become a member, on September 24, 1975. Irs amended tax return form You receive the disability payments for a combat-related injury. Irs amended tax return form This is a personal injury or sickness that Results directly from armed conflict, Takes place while you are engaged in extra-hazardous service, Takes place under conditions simulating war, including training exercises such as maneuvers, or Is caused by an instrumentality of war. Irs amended tax return form You would be entitled to receive disability compensation from the Department of Veterans Affairs (VA) if you filed an application for it. Irs amended tax return form Your exclusion under this condition is equal to the amount you would be entitled to receive from the VA. Irs amended tax return form Pension based on years of service. Irs amended tax return form   If you receive a disability pension based on years of service, in most cases you must include it in your income. Irs amended tax return form However, if the pension qualifies for the exclusion for a service-connected disability (discussed earlier), do not include in income the part of your pension that you would have received if the pension had been based on a percentage of disability. Irs amended tax return form You must include the rest of your pension in your income. Irs amended tax return form Retroactive VA determination. Irs amended tax return form   If you retire from the armed services based on years of service and are later given a retroactive service-connected disability rating by the VA, your retirement pay for the retroactive period is excluded from income up to the amount of VA disability benefits you would have been entitled to receive. Irs amended tax return form You can claim a refund of any tax paid on the excludable amount (subject to the statute of limitations) by filing an amended return on Form 1040X for each previous year during the retroactive period. Irs amended tax return form You must include with each Form 1040X a copy of the official VA Determination letter granting the retroactive benefit. Irs amended tax return form The letter must show the amount withheld and the effective date of the benefit. Irs amended tax return form   If you receive a lump-sum disability severance payment and are later awarded VA disability benefits, exclude 100% of the severance benefit from your income. Irs amended tax return form However, you must include in your income any lump-sum readjustment or other nondisability severance payment you received on release from active duty, even if you are later given a retroactive disability rating by the VA. Irs amended tax return form Special statute of limitations. Irs amended tax return form   In most cases, under the statute of limitations a claim for credit or refund must be filed within 3 years from the time a return was filed. Irs amended tax return form However, if you receive a retroactive service-connected disability rating determination, the statute of limitations is extended by a 1-year period beginning on the date of the determination. Irs amended tax return form This 1-year extended period applies to claims for credit or refund filed after June 17, 2008, and does not apply to any tax year that began more than 5 years before the date of the determination. Irs amended tax return form Example. Irs amended tax return form You retired in 2007 and receive a pension based on your years of service. Irs amended tax return form On August 1, 2013, you receive a determination of service-connected disability retroactive to 2007. Irs amended tax return form Generally, you could claim a refund for the taxes paid on your pension for 2010, 2011, and 2012. Irs amended tax return form However, under the special limitation period, you can also file a claim for 2009 as long as you file the claim by August 1, 2014. Irs amended tax return form You cannot file a claim for 2007 and 2008 because those tax years began more than 5 years before the determination. Irs amended tax return form Terrorist attack or military action. Irs amended tax return form   Do not include in your income disability payments you receive for injuries resulting directly from a terrorist or military action. Irs amended tax return form Long-Term Care Insurance Contracts Long-term care insurance contracts in most cases are treated as accident and health insurance contracts. Irs amended tax return form Amounts you receive from them (other than policyholder dividends or premium refunds) in most cases are excludable from income as amounts received for personal injury or sickness. Irs amended tax return form To claim an exclusion for payments made on a per diem or other periodic basis under a long-term care insurance contract, you must file Form 8853 with your return. Irs amended tax return form A long-term care insurance contract is an insurance contract that only provides coverage for qualified long-term care services. Irs amended tax return form The contract must: Be guaranteed renewable, Not provide for a cash surrender value or other money that can be paid, assigned, pledged, or borrowed, Provide that refunds, other than refunds on the death of the insured or complete surrender or cancellation of the contract, and dividends under the contract may be used only to reduce future premiums or increase future benefits, and In most cases, not pay or reimburse expenses incurred for services or items that would be reimbursed under Medicare, except where Medicare is a secondary payer or the contract makes per diem or other periodic payments without regard to expenses. Irs amended tax return form Qualified long-term care services. Irs amended tax return form   Qualified long-term care services are: Necessary diagnostic, preventive, therapeutic, curing, treating, mitigating, and rehabilitative services, and maintenance and personal care services, and Required by a chronically ill individual and provided pursuant to a plan of care as prescribed by a licensed health care practitioner. Irs amended tax return form Chronically ill individual. Irs amended tax return form   A chronically ill individual is one who has been certified by a licensed health care practitioner within the previous 12 months as one of the following: An individual who, for at least 90 days, is unable to perform at least two activities of daily living without substantial assistance due to loss of functional capacity. Irs amended tax return form Activities of daily living are eating, toileting, transferring, bathing, dressing, and continence. Irs amended tax return form An individual who requires substantial supervision to be protected from threats to health and safety due to severe cognitive impairment. Irs amended tax return form Limit on exclusion. Irs amended tax return form   You generally can exclude from gross income up to $320 a day for 2013. Irs amended tax return form See Limit on exclusion, under Long-Term Care Insurance Contracts, under Sickness and Injury Benefits in Publication 525 for more information. Irs amended tax return form Workers' Compensation Amounts you receive as workers' compensation for an occupational sickness or injury are fully exempt from tax if they are paid under a workers' compensation act or a statute in the nature of a workers' compensation act. Irs amended tax return form The exemption also applies to your survivors. Irs amended tax return form The exemption, however, does not apply to retirement plan benefits you receive based on your age, length of service, or prior contributions to the plan, even if you retired because of an occupational sickness or injury. Irs amended tax return form If part of your workers' compensation reduces your social security or equivalent railroad retirement benefits received, that part is considered social security (or equivalent railroad retirement) benefits and may be taxable. Irs amended tax return form For more information, see Publication 915, Social Security and Equivalent Railroad Retirement Benefits. Irs amended tax return form Return to work. Irs amended tax return form    If you return to work after qualifying for workers' compensation, salary payments you receive for performing light duties are taxable as wages. Irs amended tax return form Other Sickness and Injury Benefits In addition to disability pensions and annuities, you may receive other payments for sickness or injury. Irs amended tax return form Railroad sick pay. Irs amended tax return form    Payments you receive as sick pay under the Railroad Unemployment Insurance Act are taxable and you must include them in your income. Irs amended tax return form However, do not include them in your income if they are for an on-the-job injury. Irs amended tax return form   If you received income because of a disability, see Disability Pensions , earlier. Irs amended tax return form Federal Employees' Compensation Act (FECA). Irs amended tax return form   Payments received under this Act for personal injury or sickness, including payments to beneficiaries in case of death, are not taxable. Irs amended tax return form However, you are taxed on amounts you receive under this Act as continuation of pay for up to 45 days while a claim is being decided. Irs amended tax return form Report this income on line 7 of Form 1040 or Form 1040A or on line 1 of Form 1040-EZ. Irs amended tax return form Also, pay for sick leave while a claim is being processed is taxable and must be included in your income as wages. Irs amended tax return form    If part of the payments you receive under FECA reduces your social security or equivalent railroad retirement benefits received, that part is considered social security (or equivalent railroad retirement) benefits and may be taxable. Irs amended tax return form For a discussion of the taxability of these benefits, see Social security and equivalent railroad retirement benefits under Other Income, in Publication 525. Irs amended tax return form    You can deduct the amount you spend to buy back sick leave for an earlier year to be eligible for nontaxable FECA benefits for that period. Irs amended tax return form It is a miscellaneous deduction subject to the 2%-of-AGI limit on Schedule A (Form 1040). Irs amended tax return form If you buy back sick leave in the same year you used it, the amount reduces your taxable sick leave pay. Irs amended tax return form Do not deduct it separately. Irs amended tax return form Other compensation. Irs amended tax return form   Many other amounts you receive as compensation for sickness or injury are not taxable. Irs amended tax return form These include the following amounts. Irs amended tax return form Compensatory damages you receive for physical injury or physical sickness, whether paid in a lump sum or in periodic payments. Irs amended tax return form Benefits you receive under an accident or health insurance policy on which either you paid the premiums or your employer paid the premiums but you had to include them in your income. Irs amended tax return form Disability benefits you receive for loss of income or earning capacity as a result of injuries under a no-fault car insurance policy. Irs amended tax return form Compensation you receive for permanent loss or loss of use of a part or function of your body, or for your permanent disfigurement. Irs amended tax return form This compensation must be based only on the injury and not on the period of your absence from work. Irs amended tax return form These benefits are not taxable even if your employer pays for the accident and health plan that provides these benefits. Irs amended tax return form Reimbursement for medical care. Irs amended tax return form    A reimbursement for medical care is generally not taxable. Irs amended tax return form However, it may reduce your medical expense deduction. Irs amended tax return form For more information, see chapter 21. Irs amended tax return form Prev  Up  Next   Home   More Online Publications