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Sample 1040x Filled Out

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Sample 1040x Filled Out

Sample 1040x filled out Publication 529 - Main Content Table of Contents Deductions Subject to the 2% LimitUnreimbursed Employee Expenses Tax Preparation Fees Other Expenses Deductions Not Subject to the 2% LimitList of Deductions Nondeductible ExpensesList of Nondeductible Expenses How To ReportWho can use Form 2106-EZ. Sample 1040x filled out Computer used in a home office. Sample 1040x filled out Example How To Get Tax HelpLow Income Taxpayer Clinics Deductions Subject to the 2% Limit You can deduct certain expenses as miscellaneous itemized deductions on Schedule A (Form 1040 or Form 1040NR). Sample 1040x filled out You can claim the amount of expenses that is more than 2% of your adjusted gross income. Sample 1040x filled out You figure your deduction on Schedule A by subtracting 2% of your adjusted gross income from the total amount of these expenses. Sample 1040x filled out Your adjusted gross income is the amount on Form 1040, line 38, or Form 1040NR, line 37. Sample 1040x filled out Generally, you apply the 2% limit after you apply any other deduction limit. Sample 1040x filled out For example, you apply the 50% (or 80%) limit on business-related meals and entertainment (discussed later under Travel, Transportation, Meals, Entertainment, Gifts, and Local Lodging ) before you apply the 2% limit. Sample 1040x filled out Deductions subject to the 2% limit are discussed in the following three categories. Sample 1040x filled out Unreimbursed employee expenses (Schedule A (Form 1040), line 21 or Schedule A (Form 1040NR), line 7). Sample 1040x filled out Tax preparation fees (Schedule A (Form 1040), line 22 or Schedule A (Form 1040NR), line 8). Sample 1040x filled out Other expenses (Schedule A (Form 1040), line 23 or Schedule A (Form 1040NR), line 9). Sample 1040x filled out Unreimbursed Employee Expenses Generally, the following expenses are deducted on Schedule A (Form 1040), line 21, or Schedule A (Form 1040NR), line 7. Sample 1040x filled out You can deduct only unreimbursed employee expenses that are: Paid or incurred during your tax year, For carrying on your trade or business of being an employee, and Ordinary and necessary. Sample 1040x filled out An expense is ordinary if it is common and accepted in your trade, business, or profession. Sample 1040x filled out An expense is necessary if it is appropriate and helpful to your business. Sample 1040x filled out An expense does not have to be required to be considered necessary. Sample 1040x filled out You may be able to deduct the following items as unreimbursed employee expenses. Sample 1040x filled out Business bad debt of an employee. Sample 1040x filled out Business liability insurance premiums. Sample 1040x filled out Damages paid to a former employer for breach of an employment contract. Sample 1040x filled out Depreciation on a computer your employer requires you to use in your work. Sample 1040x filled out Dues to a chamber of commerce if membership helps you do your job. Sample 1040x filled out Dues to professional societies. Sample 1040x filled out Educator expenses. Sample 1040x filled out Home office or part of your home used regularly and exclusively in your work. Sample 1040x filled out Job search expenses in your present occupation. Sample 1040x filled out Laboratory breakage fees. Sample 1040x filled out Legal fees related to your job. Sample 1040x filled out Licenses and regulatory fees. Sample 1040x filled out Malpractice insurance premiums. Sample 1040x filled out Medical examinations required by an employer. Sample 1040x filled out Occupational taxes. Sample 1040x filled out Passport for a business trip. Sample 1040x filled out Repayment of an income aid payment received under an employer's plan. Sample 1040x filled out Research expenses of a college professor. Sample 1040x filled out Rural mail carriers' vehicle expenses. Sample 1040x filled out Subscriptions to professional journals and trade magazines related to your work. Sample 1040x filled out Tools and supplies used in your work. Sample 1040x filled out Travel, transportation, meals, entertainment, gifts, and local lodging related to your work. Sample 1040x filled out Union dues and expenses. Sample 1040x filled out Work clothes and uniforms if required and not suitable for everyday use. Sample 1040x filled out Work-related education. Sample 1040x filled out Business Bad Debt A business bad debt is a loss from a debt created or acquired in your trade or business. Sample 1040x filled out Any other worthless debt is a business bad debt only if there is a very close relationship between the debt and your trade or business when the debt becomes worthless. Sample 1040x filled out A debt has a very close relationship to your trade or business of being an employee if your main motive for incurring the debt is a business reason. Sample 1040x filled out Example. Sample 1040x filled out You make a bona fide loan to the corporation you work for. Sample 1040x filled out It fails to pay you back. Sample 1040x filled out You had to make the loan in order to keep your job. Sample 1040x filled out You have a business bad debt as an employee. Sample 1040x filled out More information. Sample 1040x filled out   For more information on business bad debts, see chapter 10 in Publication 535. Sample 1040x filled out For information on nonbusiness bad debts, see chapter 4 in Publication 550, Investment Income and Expenses. Sample 1040x filled out Business Liability Insurance You can deduct insurance premiums you paid for protection against personal liability for wrongful acts on the job. Sample 1040x filled out Damages for Breach of Employment Contract If you break an employment contract, you can deduct damages you pay your former employer if the damages are attributable to the pay you received from that employer. Sample 1040x filled out Depreciation on Computers You can claim a depreciation deduction for a computer that you use in your work as an employee if its use is: For the convenience of your employer, and Required as a condition of your employment. Sample 1040x filled out For the convenience of your employer. Sample 1040x filled out   This means that your use of the computer is for a substantial business reason of your employer. Sample 1040x filled out You must consider all facts in making this determination. Sample 1040x filled out Use of your computer during your regular working hours to carry on your employer's business is generally for the convenience of your employer. Sample 1040x filled out Required as a condition of your employment. Sample 1040x filled out   This means that you cannot properly perform your duties without the computer. Sample 1040x filled out Whether you can properly perform your duties without it depends on all the facts and circumstances. Sample 1040x filled out It is not necessary that your employer explicitly requires you to use your computer. Sample 1040x filled out But neither is it enough that your employer merely states that your use of the item is a condition of your employment. Sample 1040x filled out Example. Sample 1040x filled out You are an engineer with an engineering firm. Sample 1040x filled out You occasionally take work home at night rather than work late at the office. Sample 1040x filled out You own and use a computer that is similar to the one you use at the office to complete your work at home. Sample 1040x filled out Since your use of the computer is not for the convenience of your employer and is not required as a condition of your employment, you cannot claim a depreciation deduction for it. Sample 1040x filled out Which depreciation method to use. Sample 1040x filled out   The depreciation method you use depends on whether you meet the more-than-50%-use test. Sample 1040x filled out More-than-50%-use test met. Sample 1040x filled out   You meet this test if you use the computer more than 50% in your work. Sample 1040x filled out If you meet this test, you can claim accelerated depreciation under the General Depreciation System (GDS). Sample 1040x filled out In addition, you may be able to take the section 179 deduction for the year you place the item in service. Sample 1040x filled out More-than-50%-use test not met. Sample 1040x filled out   If you do not meet the more-than-50%-use test, you are limited to the straight line method of depreciation under the Alternative Depreciation System (ADS). Sample 1040x filled out You also cannot claim the section 179 deduction. Sample 1040x filled out (But if you use your computer in a home office, see the exception below. Sample 1040x filled out ) Investment use. Sample 1040x filled out   Your use of a computer in connection with investments (described later under Other Expenses ) does not count as use in your work. Sample 1040x filled out However, you can combine your investment use with your work use in figuring your depreciation deduction. Sample 1040x filled out Exception for computer used in a home office. Sample 1040x filled out   The more-than-50%-use test does not apply to a computer used only in a part of your home that meets the requirements described later under Home Office . Sample 1040x filled out You can claim accelerated depreciation using GDS for a computer used in a qualifying home office, even if you do not use it more than 50% in your work. Sample 1040x filled out You also may be able to take a section 179 deduction for the year you place the computer in service. Sample 1040x filled out See Computer used in a home office under How To Report, later. Sample 1040x filled out More information. Sample 1040x filled out   For more information on depreciation and the section 179 deduction for computers and other items used in a home office, see Business Furniture and Equipment in Publication 587. Sample 1040x filled out Publication 946 has detailed information about the section 179 deduction and depreciation deductions using GDS and ADS. Sample 1040x filled out Reporting your depreciation deduction. Sample 1040x filled out    See How To Report, later, for information about reporting a deduction for depreciation. Sample 1040x filled out You must keep records to prove your percentage of business and investment use. Sample 1040x filled out Dues to Chambers of Commerce and Professional Societies You may be able to deduct dues paid to professional organizations (such as bar associations and medical associations) and to chambers of commerce and similar organizations, if membership helps you carry out the duties of your job. Sample 1040x filled out Similar organizations include: Boards of trade, Business leagues, Civic or public service organizations, Real estate boards, and Trade associations. Sample 1040x filled out Lobbying and political activities. Sample 1040x filled out    You may not be able to deduct that part of your dues that is for certain lobbying and political activities. Sample 1040x filled out See Lobbying Expenses under Nondeductible Expenses, later. Sample 1040x filled out Educator Expenses If you were an eligible educator in 2013, you can deduct up to $250 of qualified expenses you paid in 2013 as an adjustment to gross income on Form 1040, line 23, rather than as a miscellaneous itemized deduction. Sample 1040x filled out If you file Form 1040A, you can deduct these expenses on line 16. Sample 1040x filled out If you and your spouse are filing jointly and both of you were eligible educators, the maximum deduction is $500. Sample 1040x filled out However, neither spouse can deduct more than $250 of his or her qualified expenses. Sample 1040x filled out Eligible educator. Sample 1040x filled out   An eligible educator is a kindergarten through grade 12 teacher, instructor, counselor, principal, or aide in school for at least 900 hours during a school year. Sample 1040x filled out Qualified expenses. Sample 1040x filled out   Qualified expenses include ordinary and necessary expenses paid in connection with books, supplies, equipment (including computer equipment, software, and services), and other materials used in the classroom. Sample 1040x filled out An ordinary expense is one that is common and accepted in your educational field. Sample 1040x filled out A necessary expense is one that is helpful and appropriate for your profession as an educator. Sample 1040x filled out An expense does not have to be required to be considered necessary. Sample 1040x filled out   Qualified expenses do not include expenses for home schooling or for nonathletic supplies for courses in health or physical education. Sample 1040x filled out You must reduce your qualified expenses by the following amounts. Sample 1040x filled out Excludable U. Sample 1040x filled out S. Sample 1040x filled out series EE and I savings bond interest from Form 8815. Sample 1040x filled out Nontaxable qualified state tuition program earnings. Sample 1040x filled out Nontaxable earnings from Coverdell education savings accounts. Sample 1040x filled out Any reimbursements you received for those expenses that were not reported to you on your Form W-2, box 1. Sample 1040x filled out Educator expenses over limit. Sample 1040x filled out   If you were an educator in 2013 and you had qualified expenses that you cannot take as an adjustment to gross income, you can deduct the rest as an itemized deduction subject to the 2% limit. Sample 1040x filled out Home Office If you use a part of your home regularly and exclusively for business purposes, you may be able to deduct a part of the operating expenses and depreciation of your home. Sample 1040x filled out You can claim this deduction for the business use of a part of your home only if you use that part of your home regularly and exclusively: As your principal place of business for any trade or business, As a place to meet or deal with your patients, clients, or customers in the normal course of your trade or business, or In the case of a separate structure not attached to your home, in connection with your trade or business. Sample 1040x filled out The regular and exclusive business use must be for the convenience of your employer and not just appropriate and helpful in your job. Sample 1040x filled out Principal place of business. Sample 1040x filled out   If you have more than one place of business, the business part of your home is your principal place of business if: You use it regularly and exclusively for administrative or management activities of your trade or business, and You have no other fixed location where you conduct substantial administrative or management activities of your trade or business. Sample 1040x filled out   Otherwise, the location of your principal place of business generally depends on the relative importance of the activities performed at each location and the time spent at each location. Sample 1040x filled out You should keep records that will give the information needed to figure the deduction according to these rules. Sample 1040x filled out Also keep canceled checks, substitute checks, or account statements and receipts of the expenses paid to prove the deductions you claim. Sample 1040x filled out More information. Sample 1040x filled out   See Publication 587 for more detailed information and a worksheet for figuring the deduction. Sample 1040x filled out Job Search Expenses You can deduct certain expenses you have in looking for a new job in your present occupation, even if you do not get a new job. Sample 1040x filled out You cannot deduct these expenses if: You are looking for a job in a new occupation, There was a substantial break between the ending of your last job and your looking for a new one, or You are looking for a job for the first time. Sample 1040x filled out Employment and outplacement agency fees. Sample 1040x filled out    You can deduct employment and outplacement agency fees you pay in looking for a new job in your present occupation. Sample 1040x filled out Employer pays you back. Sample 1040x filled out   If, in a later year, your employer pays you back for employment agency fees, you must include the amount you receive in your gross income up to the amount of your tax benefit in the earlier year. Sample 1040x filled out See Recoveries in Publication 525. Sample 1040x filled out Employer pays the employment agency. Sample 1040x filled out   If your employer pays the fees directly to the employment agency and you are not responsible for them, you do not include them in your gross income. Sample 1040x filled out Résumé. Sample 1040x filled out   You can deduct amounts you spend for preparing and mailing copies of a résumé to prospective employers if you are looking for a new job in your present occupation. Sample 1040x filled out Travel and transportation expenses. Sample 1040x filled out   If you travel to an area and, while there, you look for a new job in your present occupation, you may be able to deduct travel expenses to and from the area. Sample 1040x filled out You can deduct the travel expenses if the trip is primarily to look for a new job. Sample 1040x filled out The amount of time you spend on personal activity compared to the amount of time you spend in looking for work is important in determining whether the trip is primarily personal or is primarily to look for a new job. Sample 1040x filled out   Even if you cannot deduct the travel expenses to and from an area, you can deduct the expenses of looking for a new job in your present occupation while in the area. Sample 1040x filled out    You can choose to use the standard mileage rate to figure your car expenses. Sample 1040x filled out The 2013 rate for business use of a vehicle is 56½ cents per mile. Sample 1040x filled out See Publication 463 for more information on travel and car expenses. Sample 1040x filled out Legal Fees You can deduct legal fees related to doing or keeping your job. Sample 1040x filled out Licenses and Regulatory Fees You can deduct the amount you pay each year to state or local governments for licenses and regulatory fees for your trade, business, or profession. Sample 1040x filled out Occupational Taxes You can deduct an occupational tax charged at a flat rate by a locality for the privilege of working or conducting a business in the locality. Sample 1040x filled out If you are an employee, you can claim occupational taxes only as a miscellaneous deduction subject to the 2% limit; you cannot claim them as a deduction for taxes elsewhere on your return. Sample 1040x filled out Repayment of Income Aid Payment An “income aid payment” is one that is received under an employer's plan to aid employees who lose their jobs because of lack of work. Sample 1040x filled out If you repay a lump-sum income aid payment that you received and included in income in an earlier year, you can deduct the repayment. Sample 1040x filled out Research Expenses of a College Professor If you are a college professor, you can deduct your research expenses, including travel expenses, for teaching, lecturing, or writing and publishing on subjects that relate directly to your teaching duties. Sample 1040x filled out You must have undertaken the research as a means of carrying out the duties expected of a professor and without expectation of profit apart from salary. Sample 1040x filled out However, you cannot deduct the cost of travel as a form of education. Sample 1040x filled out Rural Mail Carriers' Vehicle Expenses If your expenses to use a vehicle in performing services as a rural mail carrier are more than the amount of your reimbursements, you can deduct the unreimbursed expenses. Sample 1040x filled out See chapter 4 of Publication 463 for more information. Sample 1040x filled out Tools Used in Your Work Generally, you can deduct amounts you spend for tools used in your work if the tools wear out and are thrown away within 1 year from the date of purchase. Sample 1040x filled out You can depreciate the cost of tools that have a useful life substantially beyond the tax year. Sample 1040x filled out For more information about depreciation, see Publication 946. Sample 1040x filled out Travel, Transportation, Meals, Entertainment, Gifts, and Local Lodging If you are an employee and have ordinary and necessary business-related expenses for travel away from home, local transportation, entertainment, and gifts, you may be able to deduct these expenses. Sample 1040x filled out Generally, you must file Form 2106 or Form 2106-EZ to claim these expenses. Sample 1040x filled out Travel expenses. Sample 1040x filled out   Travel expenses are those incurred while traveling away from home for your employer. Sample 1040x filled out You can deduct travel expenses paid or incurred in connection with a temporary work assignment. Sample 1040x filled out Generally, you cannot deduct travel expenses paid or incurred in connection with an indefinite work assignment. Sample 1040x filled out   Travel expenses may include: The cost of getting to and from your business destination (air, rail, bus, car, etc. Sample 1040x filled out ), Meals and lodging while away from home, Taxi fares, Baggage charges, and Cleaning and laundry expenses. Sample 1040x filled out   Travel expenses are discussed more fully in chapter 1 of Publication 463. Sample 1040x filled out Temporary work assignment. Sample 1040x filled out    If your assignment or job away from home in a single location is realistically expected to last (and does in fact last) for 1 year or less, it is temporary, unless there are facts and circumstances that indicate it is not. Sample 1040x filled out Indefinite work assignment. Sample 1040x filled out   If your assignment or job away from home in a single location is realistically expected to last for more than 1 year, it is indefinite, whether or not it actually lasts for more than 1 year. Sample 1040x filled out If your assignment or job away from home in a single location is realistically expected to last for 1 year or less, but at some later date it is realistically expected to exceed 1 year, it will be treated as temporary (in the absence of facts and circumstances indicating otherwise) until the date that your realistic expectation changes, and it will be treated as indefinite after that date. Sample 1040x filled out Federal crime investigation and prosecution. Sample 1040x filled out   If you are a federal employee participating in a federal crime investigation or prosecution, you are not subject to the 1-year rule for deducting temporary travel expenses. Sample 1040x filled out This means that you may be able to deduct travel expenses even if you are away from your tax home for more than 1 year. Sample 1040x filled out   To qualify, the Attorney General must certify that you are traveling: For the Federal Government, In a temporary duty status, and To investigate, prosecute, or provide support services for the investigation or prosecution of a federal crime. Sample 1040x filled out Armed Forces reservists traveling more than 100 miles from home. Sample 1040x filled out   If you are a member of a reserve component of the Armed Forces of the United States and you travel more than 100 miles away from home in connection with your performance of services as a member of the reserves, you can deduct some of your travel expenses as an adjustment to gross income rather than as a miscellaneous itemized deduction. Sample 1040x filled out The amount of expenses you can deduct as an adjustment to gross income is limited to the regular federal per diem rate (for lodging, meals, and incidental expenses) and the standard mileage rate (for car expenses) plus any parking fees, ferry fees, and tolls. Sample 1040x filled out The balance, if any, is reported on Schedule A. Sample 1040x filled out   You are a member of a reserve component of the Armed Forces of the United States if you are in the Army, Naval, Marine Corps, Air Force, Coast Guard Reserve, the Army National Guard of the United States, the Air National Guard of the United States, or the Reserve Corps of the Public Health Service. Sample 1040x filled out   For more information on travel expenses, see Publication 463. Sample 1040x filled out Local transportation expenses. Sample 1040x filled out   Local transportation expenses are the expenses of getting from one workplace to another when you are not traveling away from home. Sample 1040x filled out They include the cost of transportation by air, rail, bus, taxi, and the cost of using your car. Sample 1040x filled out   You can choose to use the standard mileage rate to figure your car expenses. Sample 1040x filled out The 2013 rate for business use of a vehicle is 56½ cents per mile. Sample 1040x filled out    In general, the costs of commuting between your residence and your place of business are nondeductible. Sample 1040x filled out Work at two places in a day. Sample 1040x filled out   If you work at two places in a day, whether or not for the same employer, you can generally deduct the expenses of getting from one workplace to the other. Sample 1040x filled out Temporary work location. Sample 1040x filled out   You can deduct expenses incurred in going between your home and a temporary work location if at least one of the following applies. Sample 1040x filled out The work location is outside the metropolitan area where you live and normally work. Sample 1040x filled out You have at least one regular work location (other than your home) for the same trade or business. Sample 1040x filled out (If this applies, the distance between your home and the temporary work location does not matter. Sample 1040x filled out )   For this purpose, a work location is generally considered temporary if your work there is realistically expected to last (and does in fact last) for 1 year or less. Sample 1040x filled out It is not temporary if your work there is realistically expected to last for more than 1 year, even if it actually lasts for 1 year or less. Sample 1040x filled out If your work there initially is realistically expected to last for 1 year or less, but later is realistically expected to last for more than 1 year, the work location is generally considered temporary until the date your realistic expectation changes and not temporary after that date. Sample 1040x filled out For more information, see chapter 1 of Publication 463. Sample 1040x filled out Home office. Sample 1040x filled out   You can deduct expenses incurred in going between your home and a workplace if your home is your principal place of business for the same trade or business. Sample 1040x filled out (In this situation, whether the other workplace is temporary or regular and its distance from your home do not matter. Sample 1040x filled out ) See Home Office , earlier, for a discussion on the use of your home as your principal place of business. Sample 1040x filled out Meals and entertainment. Sample 1040x filled out   Generally, you can deduct entertainment expenses (including entertainment-related meals) only if they are directly related to the active conduct of your trade or business. Sample 1040x filled out However, the expense only needs to be associated with the active conduct of your trade or business if it directly precedes or follows a substantial and bona fide business-related discussion. Sample 1040x filled out   You can deduct only 50% of your business-related meal and entertainment expenses unless the expenses meet certain exceptions. Sample 1040x filled out You apply this 50% limit before you apply the 2%-of-adjusted-gross-income limit. Sample 1040x filled out Meals when subject to “hours of service” limits. Sample 1040x filled out   You can deduct 80% of your business-related meal expenses if you consume the meals during or incident to any period subject to the Department of Transportation's “hours of service” limits. Sample 1040x filled out You apply this 80% limit before you apply the 2%-of-adjusted-gross-income limit. Sample 1040x filled out Gift expenses. Sample 1040x filled out   You can generally deduct up to $25 of business gifts you give to any one individual during the year. Sample 1040x filled out The following items do not count toward the $25 limit. Sample 1040x filled out Identical, widely distributed items costing $4 or less that have your name clearly and permanently imprinted. Sample 1040x filled out Signs, racks, and promotional materials to be displayed on the business premises of the recipient. Sample 1040x filled out Local lodging. Sample 1040x filled out   If your employer provides or requires you to obtain lodging while you are not traveling away from home, you can deduct the cost of the lodging if it is: on a temporary basis, necessary for you to participate in or be available for a business meeting or employer function, and the costs are ordinary and necessary, but not lavish or extravagant. Sample 1040x filled out   If your employer provides the lodging or reimburses you for the cost of the lodging, you can deduct the cost only if the value or the reimbursement is included in your gross income because it is reported as wages on your Form W-2. Sample 1040x filled out Additional information. Sample 1040x filled out    See Publication 463 for more information on travel, transportation, meal, entertainment, and gift expenses, and reimbursements for these expenses. Sample 1040x filled out Union Dues and Expenses You can deduct dues and initiation fees you pay for union membership. Sample 1040x filled out You can also deduct assessments for benefit payments to unemployed union members. Sample 1040x filled out However, you cannot deduct the part of the assessments or contributions that provides funds for the payment of sick, accident, or death benefits. Sample 1040x filled out Also, you cannot deduct contributions to a pension fund even if the union requires you to make the contributions. Sample 1040x filled out You may not be able to deduct amounts you pay to the union that are related to certain lobbying and political activities. Sample 1040x filled out See Lobbying Expenses under Nondeductible Expenses, later. Sample 1040x filled out Work Clothes and Uniforms You can deduct the cost and upkeep of work clothes if the following two requirements are met. Sample 1040x filled out You must wear them as a condition of your employment. Sample 1040x filled out The clothes are not suitable for everyday wear. Sample 1040x filled out It is not enough that you wear distinctive clothing. Sample 1040x filled out The clothing must be specifically required by your employer. Sample 1040x filled out Nor is it enough that you do not, in fact, wear your work clothes away from work. Sample 1040x filled out The clothing must not be suitable for taking the place of your regular clothing. Sample 1040x filled out Examples of workers who may be able to deduct the cost and upkeep of work clothes are: delivery workers, firefighters, health care workers, law enforcement officers, letter carriers, professional athletes, and transportation workers (air, rail, bus, etc. Sample 1040x filled out ). Sample 1040x filled out Musicians and entertainers can deduct the cost of theatrical clothing and accessories that are not suitable for everyday wear. Sample 1040x filled out However, work clothing consisting of white cap, white shirt or white jacket, white bib overalls, and standard work shoes, which a painter is required by his union to wear on the job, is not distinctive in character or in the nature of a uniform. Sample 1040x filled out Similarly, the costs of buying and maintaining blue work clothes worn by a welder at the request of a foreman are not deductible. Sample 1040x filled out Protective clothing. Sample 1040x filled out   You can deduct the cost of protective clothing required in your work, such as safety shoes or boots, safety glasses, hard hats, and work gloves. Sample 1040x filled out   Examples of workers who may be required to wear safety items are: carpenters, cement workers, chemical workers, electricians, fishing boat crew members, machinists, oil field workers, pipe fitters, steamfitters, and truck drivers. Sample 1040x filled out Military uniforms. Sample 1040x filled out   You generally cannot deduct the cost of your uniforms if you are on full-time active duty in the armed forces. Sample 1040x filled out However, if you are an armed forces reservist, you can deduct the unreimbursed cost of your uniform if military regulations restrict you from wearing it except while on duty as a reservist. Sample 1040x filled out In figuring the deduction, you must reduce the cost by any nontaxable allowance you receive for these expenses. Sample 1040x filled out   If local military rules do not allow you to wear fatigue uniforms when you are off duty, you can deduct the amount by which the cost of buying and keeping up these uniforms is more than the uniform allowance you receive. Sample 1040x filled out   If you are a student at an armed forces academy, you cannot deduct the cost of your uniforms if they replace regular clothing. Sample 1040x filled out However, you can deduct the cost of insignia, shoulder boards, and related items. Sample 1040x filled out    You can deduct the cost of your uniforms if you are a civilian faculty or staff member of a military school. Sample 1040x filled out Work-Related Education You can deduct expenses you have for education, even if the education may lead to a degree, if the education meets at least one of the following two tests. Sample 1040x filled out It maintains or improves skills required in your present work. Sample 1040x filled out It is required by your employer or the law to keep your salary, status, or job, and the requirement serves a business purpose of your employer. Sample 1040x filled out You cannot deduct expenses you have for education, even though one or both of the preceding tests are met, if the education: Is needed to meet the minimum educational requirements to qualify you in your trade or business, or Is part of a program of study that will lead to qualifying you in a new trade or business. Sample 1040x filled out If your education qualifies, you can deduct expenses for tuition, books, supplies, laboratory fees, and similar items, and certain transportation costs. Sample 1040x filled out If the education qualifies you for a new trade or business, you cannot deduct the educational expenses even if you do not intend to enter that trade or business. Sample 1040x filled out Travel as education. Sample 1040x filled out   You cannot deduct the cost of travel that in itself constitutes a form of education. Sample 1040x filled out For example, a French teacher who travels to France to maintain general familiarity with the French language and culture cannot deduct the cost of the trip as an educational expense. Sample 1040x filled out More information. Sample 1040x filled out    See Publication 970, Tax Benefits for Education, for a complete discussion of the deduction for work-related education expenses. Sample 1040x filled out Education Expenses During Unemployment If you stop working for a year or less in order to get education in order to maintain or improve skills needed in your present work and then return to the same general type of work, your absence is considered temporary. Sample 1040x filled out Education that you get during a temporary absence is qualifying work-related education if it maintains or improves skills needed in your present work. Sample 1040x filled out Tax Preparation Fees You can usually deduct tax preparation fees on the return for the year in which you pay them. Sample 1040x filled out Thus, on your 2013 return, you can deduct fees paid in 2013 for preparing your 2012 return. Sample 1040x filled out These fees include the cost of tax preparation software programs and tax publications. Sample 1040x filled out They also include any fee you paid for electronic filing of your return. Sample 1040x filled out See Tax preparation fees under How To Report, later. Sample 1040x filled out Other Expenses You can deduct certain other expenses as miscellaneous itemized deductions subject to the 2%-of-adjusted-gross-income limit. Sample 1040x filled out On Schedule A (Form 1040), line 23, or Schedule A (Form 1040NR), line 9, you can deduct the ordinary and necessary expenses that you pay: To produce or collect income that must be included in your gross income, To manage, conserve, or maintain property held for producing such income, or To determine, contest, pay, or claim a refund of any tax. Sample 1040x filled out You can deduct expenses you pay for the purposes in (1) and (2) above only if they are reasonable and closely related to these purposes. Sample 1040x filled out These other expenses include the following items. Sample 1040x filled out Appraisal fees for a casualty loss or charitable contribution. Sample 1040x filled out Casualty and theft losses from property used in performing services as an employee. Sample 1040x filled out Clerical help and office rent in caring for investments. Sample 1040x filled out Depreciation on home computers used for investments. Sample 1040x filled out Excess deductions (including administrative expenses) allowed a beneficiary on termination of an estate or trust. Sample 1040x filled out Fees to collect interest and dividends. Sample 1040x filled out Hobby expenses, but generally not more than hobby income. Sample 1040x filled out Indirect miscellaneous deductions from pass-through entities. Sample 1040x filled out Investment fees and expenses. Sample 1040x filled out Legal fees related to producing or collecting taxable income or getting tax advice. Sample 1040x filled out Loss on deposits in an insolvent or bankrupt financial institution. Sample 1040x filled out Loss on traditional IRAs or Roth IRAs, when all amounts have been distributed to you. Sample 1040x filled out Repayments of income. Sample 1040x filled out Repayments of social security benefits. Sample 1040x filled out Safe deposit box rental, except for storing jewelry and other personal effects. Sample 1040x filled out Service charges on dividend reinvestment plans. Sample 1040x filled out Tax advice fees. Sample 1040x filled out Trustee's fees for your IRA, if separately billed and paid. Sample 1040x filled out If the expenses you pay produce income that is only partially taxable, see Tax-Exempt Income Expenses, later, under Nondeductible Expenses. Sample 1040x filled out Appraisal Fees You can deduct appraisal fees if you pay them to figure a casualty loss or the fair market value of donated property. Sample 1040x filled out Casualty and Theft Losses You can deduct a casualty or theft loss as a miscellaneous itemized deduction subject to the 2% limit if you used the damaged or stolen property in performing services as an employee. Sample 1040x filled out First report the loss in Section B of Form 4684, Casualties and Thefts. Sample 1040x filled out You may also have to include the loss on Form 4797, Sales of Business Property, if you are otherwise required to file that form. Sample 1040x filled out To figure your deduction, add all casualty or theft losses from this type of property included on Form 4684, lines 32 and 38b, or Form 4797, line 18a. Sample 1040x filled out For more information on casualty and theft losses, see Publication 547, Casualties, Disasters, and Thefts. Sample 1040x filled out Clerical Help and Office Rent You can deduct office expenses, such as rent and clerical help, that you have in connection with your investments and collecting the taxable income on them. Sample 1040x filled out Credit or Debit Card Convenience Fees You can deduct the convenience fee charged by the card processor for paying your income tax (including estimated tax payments) by credit or debit card. Sample 1040x filled out The fees are deductible on the return for the year in which you paid them. Sample 1040x filled out For example, fees charged to payments made in 2013 can be claimed on the 2013 tax return. Sample 1040x filled out Depreciation on Home Computer You can deduct depreciation on your home computer if you use it to produce income (for example, to manage your investments that produce taxable income). Sample 1040x filled out You generally must depreciate the computer using the straight line method over the Alternative Depreciation System (ADS) recovery period. Sample 1040x filled out But if you work as an employee and also use the computer in that work, see Depreciation on Computers under Unreimbursed Employee Expenses, earlier. Sample 1040x filled out For more information on depreciation, see Publication 946. Sample 1040x filled out Excess Deductions of an Estate If an estate's total deductions in its last tax year are more than its gross income for that year, the beneficiaries succeeding to the estate's property can deduct the excess. Sample 1040x filled out Do not include deductions for the estate's personal exemption and charitable contributions when figuring the estate's total deductions. Sample 1040x filled out The beneficiaries can claim the deduction only for the tax year in which, or with which, the estate terminates, whether the year of termination is a normal year or a short tax year. Sample 1040x filled out For more information, see Termination of Estate in Publication 559, Survivors, Executors, and Administrators. Sample 1040x filled out Fees To Collect Interest and Dividends You can deduct fees you pay to a broker, bank, trustee, or similar agent to collect your taxable bond interest or dividends on shares of stock. Sample 1040x filled out But you cannot deduct a fee you pay to a broker to buy investment property, such as stocks or bonds. Sample 1040x filled out You must add the fee to the cost of the property. Sample 1040x filled out You cannot deduct the fee you pay to a broker to sell securities. Sample 1040x filled out You can use the fee only to figure gain or loss from the sale. Sample 1040x filled out See the instructions for Schedule D (Form 1040) for information on how to report the fee. Sample 1040x filled out Hobby Expenses You can generally deduct hobby expenses, but only up to the amount of hobby income. Sample 1040x filled out A hobby is not a business because it is not carried on to make a profit. Sample 1040x filled out See Not-for-Profit Activities in chapter 1 of Publication 535. Sample 1040x filled out Indirect Deductions of Pass-Through Entities Pass-through entities include partnerships, S corporations, and mutual funds that are not publicly offered. Sample 1040x filled out Deductions of pass-through entities are passed through to the partners or shareholders. Sample 1040x filled out The partners or shareholders can deduct their share of passed-through deductions for investment expenses as miscellaneous itemized deductions subject to the 2% limit. Sample 1040x filled out Example. Sample 1040x filled out You are a member of an investment club that is formed solely to invest in securities. Sample 1040x filled out The club is treated as a partnership. Sample 1040x filled out The partnership's income is solely from taxable dividends, interest, and gains from sales of securities. Sample 1040x filled out In this case, you can deduct your share of the partnership's operating expenses as miscellaneous itemized deductions subject to the 2% limit. Sample 1040x filled out However, if the investment club partnership has investments that also produce nontaxable income, you cannot deduct your share of the partnership's expenses that produce the nontaxable income. Sample 1040x filled out Publicly offered mutual funds. Sample 1040x filled out   Publicly offered mutual funds do not pass deductions for investment expenses through to shareholders. Sample 1040x filled out A mutual fund is “publicly offered” if it is: Continuously offered pursuant to a public offering, Regularly traded on an established securities market, or Held by or for at least 500 persons at all times during the tax year. Sample 1040x filled out   A publicly offered mutual fund will send you a Form 1099-DIV, Dividends and Distributions, or a substitute form, showing the net amount of dividend income (gross dividends minus investment expenses). Sample 1040x filled out This net figure is the amount you report on your return as income. Sample 1040x filled out You cannot further deduct investment expenses related to publicly offered mutual funds because they are already included as part of the net income amount. Sample 1040x filled out Information returns. Sample 1040x filled out   You should receive information returns from pass-through entities. Sample 1040x filled out Partnerships and S corporations. Sample 1040x filled out   These entities issue Schedule K-1, which lists the items and amounts you must report, and identifies the tax return schedules and lines to use. Sample 1040x filled out Nonpublicly offered mutual funds. Sample 1040x filled out   These funds will send you a Form 1099-DIV, or a substitute form, showing your share of gross income and investment expenses. Sample 1040x filled out You can claim the expenses only as a miscellaneous itemized deduction subject to the 2% limit. Sample 1040x filled out Investment Fees and Expenses You can deduct investment fees, custodial fees, trust administration fees, and other expenses you paid for managing your investments that produce taxable income. Sample 1040x filled out Legal Expenses You can usually deduct legal expenses that you incur in attempting to produce or collect taxable income or that you pay in connection with the determination, collection, or refund of any tax. Sample 1040x filled out You can also deduct legal expenses that are: Related to either doing or keeping your job, such as those you paid to defend yourself against criminal charges arising out of your trade or business, For tax advice related to a divorce if the bill specifies how much is for tax advice and it is determined in a reasonable way, or To collect taxable alimony. Sample 1040x filled out You can deduct expenses of resolving tax issues relating to profit or loss from business (Schedule C or C-EZ), rentals or royalties (Schedule E), or farm income and expenses (Schedule F) on the appropriate schedule. Sample 1040x filled out You deduct expenses of resolving nonbusiness tax issues on Schedule A (Form 1040 or Form 1040NR). Sample 1040x filled out See Tax Preparation Fees, earlier. Sample 1040x filled out Unlawful discrimination claims. Sample 1040x filled out   You may be able to deduct, as an adjustment to income on Form 1040, line 36, or Form 1040NR, line 35, rather than as a miscellaneous itemized deduction, attorney fees and court costs for actions settled or decided after October 22, 2004, involving a claim of unlawful discrimination, a claim against the U. Sample 1040x filled out S. Sample 1040x filled out Government, or a claim made under section 1862(b)(3)(A) of the Social Security Act. Sample 1040x filled out However, the amount you can deduct on Form 1040, line 36, or Form 1040NR, line 35, is limited to the amount of the judgment or settlement you are including in income for the tax year. Sample 1040x filled out See Publication 525 for more information. Sample 1040x filled out Loss on Deposits A loss on deposits can occur when a bank, credit union, or other financial institution becomes insolvent or bankrupt. Sample 1040x filled out If you can reasonably estimate the amount of your loss on money you have on deposit in a financial institution that becomes insolvent or bankrupt, you can generally choose to deduct it in the current year even though its exact amount has not been finally determined. Sample 1040x filled out If elected, the casualty loss is subject to certain deduction limitations. Sample 1040x filled out The election is made on Form 4684. Sample 1040x filled out Once you make this choice, you cannot change it without IRS approval. Sample 1040x filled out If none of the deposit is federally insured, you can deduct the loss in either of the following ways. Sample 1040x filled out As an ordinary loss (as a miscellaneous itemized deduction subject to the 2% limit). Sample 1040x filled out Write the name of the financial institution and “Insolvent Financial Institution” beside the amount on Schedule A (Form 1040), line 23, or Schedule A (Form 1040NR), line 9. Sample 1040x filled out This deduction is limited to $20,000 ($10,000 if you are married filing separately) for each financial institution, reduced by any expected state insurance proceeds. Sample 1040x filled out As a casualty loss. Sample 1040x filled out Report it on Form 4684 first and then on Schedule A (Form 1040). Sample 1040x filled out See Publication 547 for details. Sample 1040x filled out As a nonbusiness bad debt. Sample 1040x filled out Report it on Schedule D (Form 1040). Sample 1040x filled out If any part of the deposit is federally insured, you can deduct the loss only as a casualty loss. Sample 1040x filled out Exception. Sample 1040x filled out   You cannot make this choice if you are a 1%-or-more-owner or an officer of the financial institution, or are related to such owner or officer. Sample 1040x filled out For a definition of “related,” see Deposit in Insolvent or Bankrupt Financial Institution in chapter 4 of Publication 550. Sample 1040x filled out Actual loss different from estimated loss. Sample 1040x filled out   If you make this choice and your actual loss is less than your estimated loss, you must include the excess in income. Sample 1040x filled out See Recoveries in Publication 525. Sample 1040x filled out If your actual loss is more than your estimated loss, treat the excess loss as explained under Choice not made, next. Sample 1040x filled out Choice not made. Sample 1040x filled out   If you do not make this choice (or if you have an excess actual loss after choosing to deduct your estimated loss), treat your loss (or excess loss) as a nonbusiness bad debt (deductible as a short-term capital loss) in the year its amount is finally determined. Sample 1040x filled out See Nonbusiness Bad Debts in chapter 4 of Publication 550. Sample 1040x filled out Loss on IRA If you have a loss on your traditional IRA (or Roth IRA) investment, you can deduct the loss as a miscellaneous itemized deduction subject to the 2% limit, but only when all the amounts in all your traditional IRA (or Roth IRA) accounts have been distributed to you and the total distributions are less than your unrecovered basis. Sample 1040x filled out For more information, see Publication 590, Individual Retirement Arrangements (IRAs). Sample 1040x filled out Repayments of Income If you had to repay an amount that you included in income in an earlier year, you may be able to deduct the amount you repaid. Sample 1040x filled out If the amount you had to repay was ordinary income of $3,000 or less, the deduction is subject to the 2% limit. Sample 1040x filled out If it was more than $3,000, see Repayments Under Claim of Right under Deductions Not Subject to the 2% Limit, later. Sample 1040x filled out Repayments of Social Security Benefits If the total of the amounts in box 5 (net benefits for 2013) of all your Forms SSA-1099, Social Security Benefit Statement, and Forms RRB-1099, Payments By the Railroad Retirement Board, is a negative figure (a figure in parentheses), you may be able to take a miscellaneous itemized deduction subject to the 2% limit. Sample 1040x filled out The amount you can deduct is the part of the negative figure that represents an amount you included in gross income in an earlier year. Sample 1040x filled out The amount in box 5 of Form SSA-1099 or RRB-1099 is the net amount of your benefits for the year. Sample 1040x filled out It will be a negative figure if the amount of benefits you repaid in 2013 (box 4) is more than the gross amount of benefits paid to you in 2013 (box 3). Sample 1040x filled out If the deduction is more than $3,000, you will have to use a special computation to figure your tax. Sample 1040x filled out See Publication 915, Social Security and Equivalent Railroad Retirement Benefits, for additional information. Sample 1040x filled out Safe Deposit Box Rent You can deduct safe deposit box rent if you use the box to store taxable income-producing stocks, bonds, or investment-related papers and documents. Sample 1040x filled out You cannot deduct the rent if you use the box only for jewelry, other personal items, or tax-exempt securities. Sample 1040x filled out Service Charges on Dividend Reinvestment Plans You can deduct service charges you pay as a subscriber in a dividend reinvestment plan. Sample 1040x filled out These service charges include payments for: Holding shares acquired through a plan, Collecting and reinvesting cash dividends, and Keeping individual records and providing detailed statements of accounts. Sample 1040x filled out Trustee's Administrative Fees for IRA Trustee's administrative fees that are billed separately and paid by you in connection with your IRA are deductible (if they are ordinary and necessary) as a miscellaneous itemized deduction subject to the 2% limit. Sample 1040x filled out Deductions Not Subject to the 2% Limit You can deduct the items listed below as miscellaneous itemized deductions. Sample 1040x filled out They are not subject to the 2% limit. Sample 1040x filled out Report these items on Schedule A (Form 1040), line 28, or Schedule A (Form 1040NR), line 14. Sample 1040x filled out List of Deductions Amortizable premium on taxable bonds. Sample 1040x filled out Casualty and theft losses from income-producing property. Sample 1040x filled out Federal estate tax on income in respect of a decedent. Sample 1040x filled out Gambling losses up to the amount of gambling winnings. Sample 1040x filled out Impairment-related work expenses of persons with disabilities. Sample 1040x filled out Loss from other activities from Schedule K-1 (Form 1065-B), box 2. Sample 1040x filled out Losses from Ponzi-type investment schemes. Sample 1040x filled out Repayments of more than $3,000 under a claim of right. Sample 1040x filled out Unrecovered investment in an annuity. Sample 1040x filled out Amortizable Premium on Taxable Bonds In general, if the amount you pay for a bond is greater than its stated principal amount, the excess is bond premium. Sample 1040x filled out You can elect to amortize the premium on taxable bonds. Sample 1040x filled out The amortization of the premium is generally an offset to interest income on the bond rather than a separate deduction item. Sample 1040x filled out Pre-1998 election to amortize bond premium. Sample 1040x filled out   Generally, if you first elected to amortize bond premium before 1998, the above treatment of the premium does not apply to bonds you acquired before 1988. Sample 1040x filled out Bonds acquired after October 22, 1986, and before 1988. Sample 1040x filled out   The amortization of the premium on these bonds is investment interest expense subject to the investment interest limit, unless you chose to treat it as an offset to interest income on the bond. Sample 1040x filled out Bonds acquired before October 23, 1986. Sample 1040x filled out   The amortization of the premium on these bonds is a miscellaneous itemized deduction not subject to the 2% limit. Sample 1040x filled out Deduction for excess premium. Sample 1040x filled out   On certain bonds (such as bonds that pay a variable rate of interest or that provide for an interest-free period), the amount of bond premium allocable to a period may exceed the amount of stated interest allocable to the period. Sample 1040x filled out If this occurs, treat the excess as a miscellaneous itemized deduction that is not subject to the 2% limit. Sample 1040x filled out However, the amount deductible is limited to the amount by which your total interest inclusions on the bond in prior periods exceed the total amount you treated as a bond premium deduction on the bond in prior periods. Sample 1040x filled out If any of the excess bond premium cannot be deducted because of the limit, this amount is carried forward to the next period and is treated as bond premium allocable to that period. Sample 1040x filled out    Pre-1998 choice to amortize bond premium. Sample 1040x filled out If you made the choice to amortize the premium on taxable bonds before 1998, you can deduct the bond premium amortization that is more than your interest income only for bonds acquired during 1998 and later years. Sample 1040x filled out More information. Sample 1040x filled out    For more information on bond premium, see Bond Premium Amortization in chapter 3 of Publication 550. Sample 1040x filled out Casualty and Theft Losses of Income-Producing Property You can deduct a casualty or theft loss as a miscellaneous itemized deduction not subject to the 2% limit if the damaged or stolen property was income-producing property (property held for investment, such as stocks, notes, bonds, gold, silver, vacant lots, and works of art). Sample 1040x filled out First report the loss in Section B of Form 4684. Sample 1040x filled out You may also have to include the loss on Form 4797, Sales of Business Property, if you are otherwise required to file that form. Sample 1040x filled out To figure your deduction, add all casualty or theft losses from this type of property included on Form 4684, lines 32 and 38b, or Form 4797, line 18a. Sample 1040x filled out For more information on casualty and theft losses, see Publication 547. Sample 1040x filled out Federal Estate Tax on Income in Respect of a Decedent You can deduct the federal estate tax attributable to income in respect of a decedent that you as a beneficiary include in your gross income. Sample 1040x filled out Income in respect of the decedent is gross income that the decedent would have received had death not occurred and that was not properly includible in the decedent's final income tax return. Sample 1040x filled out See Publication 559 for information about figuring the amount of this deduction. Sample 1040x filled out Gambling Losses Up to the Amount of Gambling Winnings You must report the full amount of your gambling winnings for the year on Form 1040, line 21. Sample 1040x filled out You deduct your gambling losses for the year on Schedule A (Form 1040), line 28. Sample 1040x filled out You cannot deduct gambling losses that are more than your winnings. Sample 1040x filled out Generally, nonresident aliens cannot deduct gambling losses on Schedule A (Form 1040NR). Sample 1040x filled out You cannot reduce your gambling winnings by your gambling losses and report the difference. Sample 1040x filled out You must report the full amount of your winnings as income and claim your losses (up to the amount of winnings) as an itemized deduction. Sample 1040x filled out Therefore, your records should show your winnings separately from your losses. Sample 1040x filled out Diary of winnings and losses. Sample 1040x filled out You must keep an accurate diary or similar record of your losses and winnings. Sample 1040x filled out Your diary should contain at least the following information. Sample 1040x filled out The date and type of your specific wager or wagering activity. Sample 1040x filled out The name and address or location of the gambling establishment. Sample 1040x filled out The names of other persons present with you at the gambling establishment. Sample 1040x filled out The amount(s) you won or lost. Sample 1040x filled out Proof of winnings and losses. Sample 1040x filled out   In addition to your diary, you should also have other documentation. Sample 1040x filled out You can generally prove your winnings and losses through Form W-2G, Certain Gambling Winnings, Form 5754, Statement by Person(s) Receiving Gambling Winnings, wagering tickets, canceled checks, substitute checks, credit records, bank withdrawals, and statements of actual winnings or payment slips provided to you by the gambling establishment. Sample 1040x filled out   For specific wagering transactions, you can use the following items to support your winnings and losses. Sample 1040x filled out    These recordkeeping suggestions are intended as general guidelines to help you establish your winnings and losses. Sample 1040x filled out They are not all-inclusive. Sample 1040x filled out Your tax liability depends on your particular facts and circumstances. Sample 1040x filled out Keno. Sample 1040x filled out   Copies of the keno tickets you purchased that were validated by the gambling establishment, copies of your casino credit records, and copies of your casino check cashing records. Sample 1040x filled out Slot machines. Sample 1040x filled out   A record of the machine number and all winnings by date and time the machine was played. Sample 1040x filled out Table games (twenty-one (blackjack), craps, poker, baccarat, roulette, wheel of fortune, etc. Sample 1040x filled out ). Sample 1040x filled out   The number of the table at which you were playing. Sample 1040x filled out Casino credit card data indicating whether the credit was issued in the pit or at the cashier's cage. Sample 1040x filled out Bingo. Sample 1040x filled out   A record of the number of games played, cost of tickets purchased, and amounts collected on winning tickets. Sample 1040x filled out Supplemental records include any receipts from the casino, parlor, etc. Sample 1040x filled out Racing (horse, harness, dog, etc. Sample 1040x filled out ). Sample 1040x filled out   A record of the races, amounts of wagers, amounts collected on winning tickets, and amounts lost on losing tickets. Sample 1040x filled out Supplemental records include unredeemed tickets and payment records from the racetrack. Sample 1040x filled out Lotteries. Sample 1040x filled out   A record of ticket purchases, dates, winnings, and losses. Sample 1040x filled out Supplemental records include unredeemed tickets, payment slips, and winnings statements. Sample 1040x filled out Impairment-Related Work Expenses If you have a physical or mental disability that limits your being employed, or substantially limits one or more of your major life activities, such as performing manual tasks, walking, speaking, breathing, learning, and working, you can deduct your impairment-related work expenses. Sample 1040x filled out Impairment-related work expenses are ordinary and necessary business expenses for attendant care services at your place of work and other expenses in connection with your place of work that are necessary for you to be able to work. Sample 1040x filled out Example. Sample 1040x filled out You are blind. Sample 1040x filled out You must use a reader to do your work. Sample 1040x filled out You use the reader both during your regular working hours at your place of work and outside your regular working hours away from your place of work. Sample 1040x filled out The reader's services are only for your work. Sample 1040x filled out You can deduct your expenses for the reader as impairment-related work expenses. Sample 1040x filled out Self-employed. Sample 1040x filled out   If you are self-employed, enter your impairment-related work expenses on the appropriate form (Schedule C, C-EZ, E, or F) used to report your business income and expenses. Sample 1040x filled out See Impairment-related work expenses. Sample 1040x filled out , later under How To Report. Sample 1040x filled out Loss From Other Activities From Schedule K-1 (Form 1065-B), Box 2 If the amount reported in Schedule K-1 (Form 1065-B), box 2, is a loss, report it on Schedule A (Form 1040), line 28, or Schedule A (Form 1040NR), line 14 (only if effectively connected with a U. Sample 1040x filled out S. Sample 1040x filled out trade or business). Sample 1040x filled out It is not subject to the passive activity limitations. Sample 1040x filled out Officials Paid on a Fee Basis If you are a fee-basis official, you can claim your expenses in performing services in that job as an adjustment to income rather than as a miscellaneous itemized deduction. Sample 1040x filled out See Publication 463 for more information. Sample 1040x filled out Performing Artists If you are a qualified performing artist, you can deduct your employee business expenses as an adjustment to income rather than as a miscellaneous itemized deduction. Sample 1040x filled out If you are an employee, complete Form 2106 or Form 2106-EZ. Sample 1040x filled out See Publication 463 for more information. Sample 1040x filled out Losses From Ponzi-type Investment Schemes These losses are deductible as theft losses of income-producing property on your tax return for the year the loss was discovered. Sample 1040x filled out You figure the deductible loss in Section B of Form 4684. Sample 1040x filled out However, if you qualify to use Revenue Procedure 2009-20 (as modified by Revenue Procedure 2011-58) and you choose to follow the procedures in the guidance, complete Section C of Form 4684 before completing Section B. Sample 1040x filled out Section C of Form 4684 replaces Appendix A in Revenue Procedure 2009-20. Sample 1040x filled out You do not need to complete Appendix A. Sample 1040x filled out See the Form 4684 instructions and Publication 547, Casualties, Disasters, and Thefts, for more information. Sample 1040x filled out Repayments Under Claim of Right If you had to repay more than $3,000 that you included in your income in an earlier year because at the time you thought you had an unrestricted right to it, you may be able to deduct the amount you repaid, or take a credit against your tax. Sample 1040x filled out See Repayments in Publication 525 for more information. Sample 1040x filled out Unrecovered Investment in Annuity A retiree who contributed to the cost of an annuity can exclude from income a part of each payment received as a tax-free return of the retiree's investment. Sample 1040x filled out If the retiree dies before the entire investment is recovered tax free, any unrecovered investment can be deducted on the retiree's final income tax return. Sample 1040x filled out See Publication 575, Pension and Annuity Income, for more information about the tax treatment of pensions and annuities. Sample 1040x filled out Nondeductible Expenses You cannot deduct the following expenses. Sample 1040x filled out List of Nondeductible Expenses Adoption expenses. Sample 1040x filled out Broker's commissions. Sample 1040x filled out Burial or funeral expenses, including the cost of a cemetery lot. Sample 1040x filled out Campaign expenses. Sample 1040x filled out Capital expenses. Sample 1040x filled out Check-writing fees. Sample 1040x filled out Club dues. Sample 1040x filled out Commuting expenses. Sample 1040x filled out Fees and licenses, such as car licenses, marriage licenses, and dog tags. Sample 1040x filled out Fines and penalties, such as parking tickets. Sample 1040x filled out Health spa expenses. Sample 1040x filled out Hobby losses—but see Hobby Expenses, earlier. Sample 1040x filled out Home repairs, insurance, and rent. Sample 1040x filled out Home security system. Sample 1040x filled out Illegal bribes and kickbacks—see Bribes and kickbacks in chapter 11 of Publication 535. Sample 1040x filled out Investment-related seminars. Sample 1040x filled out Life insurance premiums paid by the insured. Sample 1040x filled out Lobbying expenses. Sample 1040x filled out Losses from the sale of your home, furniture, personal car, etc. Sample 1040x filled out Lost or misplaced cash or property. Sample 1040x filled out Lunches with co-workers. Sample 1040x filled out Meals while working late. Sample 1040x filled out Medical expenses as business expenses other than medical examinations required by your employer. Sample 1040x filled out Personal disability insurance premiums. Sample 1040x filled out Personal legal expenses. Sample 1040x filled out Personal, living, or family expenses. Sample 1040x filled out Political contributions. Sample 1040x filled out Professional accreditation fees. Sample 1040x filled out Professional reputation, expenses to improve. Sample 1040x filled out Relief fund contributions. Sample 1040x filled out Residential telephone line. Sample 1040x filled out Stockholders' meeting, expenses of attending. Sample 1040x filled out Tax-exempt income, expenses of earning or collecting. Sample 1040x filled out The value of wages never received or lost vacation time. Sample 1040x filled out Travel expenses for another individual. Sample 1040x filled out Voluntary unemployment benefit fund contributions. Sample 1040x filled out Wristwatches. Sample 1040x filled out Adoption Expenses You cannot deduct the expenses of adopting a child but you may be able to take a credit for those expenses. Sample 1040x filled out For details, see Form 8839, Qualified Adoption Expenses. Sample 1040x filled out Commissions Commissions paid on the purchase of securities are not deductible, either as business or nonbusiness expenses. Sample 1040x filled out Instead, these fees must be added to the taxpayer's cost of the securities. Sample 1040x filled out Commissions paid on the sale are deductible as business expenses only by dealers. Sample 1040x filled out Campaign Expenses You cannot deduct campaign expenses of a candidate for any office, even if the candidate is running for reelection to the office. Sample 1040x filled out These include qualification and registration fees for primary elections. Sample 1040x filled out Legal fees. Sample 1040x filled out   You cannot deduct legal fees paid to defend charges that arise from participation in a political campaign. Sample 1040x filled out Capital Expenses You cannot currently deduct amounts paid to buy property that has a useful life substantially beyond the tax year or amounts paid to increase the value or prolong the life of property. Sample 1040x filled out If you use such property in your work, you may be able to take a depreciation deduction. Sample 1040x filled out See Publication 946. Sample 1040x filled out If the property is a car used in your work, also see Publication 463. Sample 1040x filled out Check-Writing Fees on Personal Account If you have a personal checking account, you cannot deduct fees charged by the bank for the privilege of writing checks, even if the account pays interest. Sample 1040x filled out Club Dues Generally, you cannot deduct the cost of membership in any club organized for business, pleasure, recreation, or other social purpose. Sample 1040x filled out This includes business, social, athletic, luncheon, sporting, airline, hotel, golf, and country clubs. Sample 1040x filled out You cannot deduct dues paid to an organization if one of its main purposes is to: Conduct entertainment activities for members or their guests, or Provide members or their guests with access to entertainment facilities. Sample 1040x filled out Dues paid to airline, hotel, and luncheon clubs are not deductible. Sample 1040x filled out Commuting Expenses You cannot deduct commuting expenses (the cost of transportation between your home and your main or regular place of work). Sample 1040x filled out If you haul tools, instruments, or other items in your car to and from work, you can deduct only the additional cost of hauling the items, such as the rent on a trailer to carry the items. Sample 1040x filled out Fines or Penalties You cannot deduct fines or penalties you pay to a governmental unit for violating a law. Sample 1040x filled out This includes an amount paid in settlement of your actual or potential liability for a fine or penalty (civil or criminal). Sample 1040x filled out Fines or penalties include parking tickets, tax penalties, and penalties deducted from teachers' paychecks after an illegal strike. Sample 1040x filled out Health Spa Expenses You cannot deduct health spa expenses, even if there is a job requirement to stay in excellent physical condition, such as might be required of a law enforcement officer. Sample 1040x filled out Home Security System You cannot deduct the cost of a home security system as a miscellaneous deduction. Sample 1040x filled out However, you may be able to claim a deduction for a home security system as a business expense if you have a home office. Sample 1040x filled out See Home Office under Unreimbursed Employee Expenses, earlier, and Publication 587. Sample 1040x filled out Investment-Related Seminars You cannot deduct any expenses for attending a convention, seminar, or similar meeting for investment purposes. Sample 1040x filled out Life Insurance Premiums You cannot deduct premiums you pay on your life insurance. Sample 1040x filled out You may be able to deduct, as alimony, premiums you pay on life insurance policies assigned to your former spouse. Sample 1040x filled out See Publication 504, Divorced or Separated Individuals, for information on alimony. Sample 1040x filled out Lobbying Expenses You generally cannot deduct amounts paid or incurred for lobbying expenses. Sample 1040x filled out These include expenses to: Influence legislation, Participate, or intervene, in any political campaign for, or against, any candidate for public office, Attempt to influence the general public, or segments of the public, about elections, legislative matters, or referendums, or Communicate directly with covered executive branch officials in any attempt to influence the official actions or positions of those officials. Sample 1040x filled out Lobbying expenses also include any amounts paid or incurred for research, preparation, planning, or coordination of any of these activities. Sample 1040x filled out Covered executive branch official. Sample 1040x filled out   A covered executive branch official, for the purpose of (4) above, is any of the following officials. Sample 1040x filled out The President. Sample 1040x filled out The Vice President. Sample 1040x filled out Any officer or employee of the White House Office of the Executive Office of the President, and the two most senior level officers of each of the other agencies in the Executive Office. Sample 1040x filled out Any individual serving in a position in Level I of the Executive Schedule under section 5312 of Title 5, United States Code, any other individual designated by the President as having Cabinet-level status, and any immediate deputy of one of these individuals. Sample 1040x filled out Dues used for lobbying. Sample 1040x filled out   If a tax-exempt organization notifies you that part of the dues or other amounts you pay to the organization are used to pay nondeductible lobbying expenses, you cannot deduct that part. Sample 1040x filled out Exceptions. Sample 1040x filled out   You can deduct certain lobbying expenses if they are ordinary and necessary expenses of carrying on your trade or business. Sample 1040x filled out You can deduct expenses for attempting to influence the legislation of any local council or similar governing body (local legislation). Sample 1040x filled out An Indian tribal government is considered a local council or similar governing body. Sample 1040x filled out You can deduct in-house expenses for influencing legislation or communicating directly with a covered executive branch official if the expenses for the tax year are not more than $2,000 (not counting overhead expenses). Sample 1040x filled out If you are a professional lobbyist, you can deduct the expenses you incur in the trade or business of lobbying on behalf of another person. Sample 1040x filled out Payments by the other person to you for lobbying activities cannot be deducted. Sample 1040x filled out Lost or Mislaid Cash or Property You cannot deduct a loss based on the mere disappearance of money or property. Sample 1040x filled out However, an accidental loss or disappearance of property can qualify as a casualty if it results from an identifiable event that is sudden, unexpected, or unusual. Sample 1040x filled out See Publication 547. Sample 1040x filled out Example. Sample 1040x filled out A car door is accidentally slammed on your hand, breaking the setting of your diamond ring. Sample 1040x filled out The diamond falls from the ring and is never found. Sample 1040x filled out The loss of the diamond is a casualty. Sample 1040x filled out Lunches With Co-workers You cannot deduct the expenses of lunches with co-workers, except while traveling away from home on business. Sample 1040x filled out See Publication 463 for information on deductible expenses while traveling away from home. Sample 1040x filled out Meals While Working Late You cannot deduct the cost of meals while working late. Sample 1040x filled out However, you may be able to claim a deduction if the cost of the meals is a deductible entertainment expense, or if you are traveling away from home. Sample 1040x filled out See Publication 463 for information on deductible entertainment expenses and expenses while traveling away from home. Sample 1040x filled out Personal Legal Expenses You cannot deduct personal legal expenses such as those for the following. Sample 1040x filled out Custody of children. Sample 1040x filled out Breach of promise to marry suit. Sample 1040x filled out Civil or criminal charges resulting from a personal relationship. Sample 1040x filled out Damages for personal injury (except certain whistleblower claims and unlawful discrimination claims). Sample 1040x filled out For more information about unlawful discrimination claims, see Deductions Subject to the 2% Limit, earlier. Sample 1040x filled out Preparation of a title (or defense or perfection of a title). Sample 1040x filled out Preparation of a will. Sample 1040x filled out Property claims or property settlement in a divorce. Sample 1040x filled out You cannot deduct these expenses even if a result of the legal proceeding is the loss of income-producing property. Sample 1040x filled out Political Contributions You cannot deduct contributions made to a political candidate, a campaign committee, or a newsletter fund. Sample 1040x filled out Advertisements in convention bulletins and admissions to dinners or programs that benefit a political party or political candidate are not deductible. Sample 1040x filled out Professional Accreditation Fees You cannot deduct professional accreditation fees such as the following. Sample 1040x filled out Accounting certificate fees paid for the initial right to practice accounting. Sample 1040x filled out Bar exam fees and incidental expenses in securing initial admission to the bar. Sample 1040x filled out Medical and dental license fees paid to get initial licensing. Sample 1040x filled out Professional Reputation You cannot deduct expenses of radio and TV appearances to increase your personal prestige or establish your professional reputation. Sample 1040x filled out Relief Fund Contributions You cannot deduct contributions paid to a private plan that pays benefits to any covered employee who cannot work because of any injury or illness not related to the job. Sample 1040x filled out Residential Telephone Service You cannot deduct any charge (including taxes) for basic local telephone service for the first telephone line to your residence, even if it is used in a trade or business. Sample 1040x filled out Stockholders' Meetings You cannot deduct transportation and other expenses you pay to attend stockholders' meetings of companies in which you own stock but have no other interest. Sample 1040x filled out You cannot deduct these expenses even if you are attending the meeting to get information that would be useful in making further investments. Sample 1040x filled out Tax-Exempt Income Expenses You cannot deduct expenses to produce tax-exempt income. Sample 1040x filled out You cannot deduct interest on a debt incurred or continued to buy or carry tax-exempt securities. Sample 1040x filled out If you have expenses to p
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Report Name Change before You File Taxes

IRS Tax Tip 2014-08, February 6, 2014

Did you change your name last year? Did your dependent have a name change? If the answer to either question is yes, be sure to notify the Social Security Administration before you file your tax return with the IRS.

This is important because the name on your tax return must match SSA records. If they don’t, you’re likely to get a letter from the IRS about the mismatch. And if you expect a refund, this may delay when you’ll get it.

Be sure to contact SSA if:

  • You got married or divorced and you changed your name.

  • A dependent you claim had a name change. For example, this would apply if you adopted a child and that child’s last name changed.

File Form SS-5, Application for a Social Security Card, with the SSA to let them know about a name change. You can get the form on SSA.gov by calling 800-772-1213 or at an SSA office.

You can file Form SS-5 at an SSA office or by mail. Your new card will have the same SSN as before but will show your new name.

If you have an adopted child who does not have a SSN, use a temporary Adoption Taxpayer Identification Number on your tax form. You can apply for an ATIN by filing Form W-7A, Application for Taxpayer Identification Number for Pending U.S. Adoptions, with the IRS. Get the form on IRS.gov or by calling 800-TAX-FORM (800-829-3676).
 

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Page Last Reviewed or Updated: 06-Feb-2014

The Sample 1040x Filled Out

Sample 1040x filled out 6. Sample 1040x filled out   Tuition and Fees Deduction Table of Contents IntroductionWhat is the tax benefit of the tuition and fees deduction. Sample 1040x filled out Can You Claim the DeductionWho Can Claim the Deduction Who Cannot Claim the Deduction What Expenses QualifyQualified Education Expenses No Double Benefit Allowed Expenses That Do Not Qualify Who Is an Eligible Student Who Can Claim a Dependent's Expenses Figuring the DeductionEffect of the Amount of Your Income on the Amount of Your Deduction Claiming the Deduction Illustrated Example Introduction You may be able to deduct qualified education expenses paid during the year for yourself, your spouse, or your dependent(s). Sample 1040x filled out You cannot claim this deduction if your filing status is married filing separately or if another person can claim an exemption for you as a dependent on his or her tax return. Sample 1040x filled out The qualified expenses must be for higher education, as explained later under Qualified Education Expenses . Sample 1040x filled out What is the tax benefit of the tuition and fees deduction. Sample 1040x filled out   The tuition and fees deduction can reduce the amount of your income subject to tax by up to $4,000. Sample 1040x filled out   This deduction is taken as an adjustment to income. Sample 1040x filled out This means you can claim this deduction even if you do not itemize deductions on Schedule A (Form 1040). Sample 1040x filled out This deduction may be beneficial to you if you do not qualify for the American opportunity or lifetime learning credits. Sample 1040x filled out You can choose the education benefit that will give you the lowest tax. Sample 1040x filled out You may want to compare the tuition and fees deduction to the education credits. Sample 1040x filled out See chapter 2, American Opportunity Credit and chapter 3, Lifetime Learning Credit for more information on the education credits. Sample 1040x filled out Table 6-1. Sample 1040x filled out Tuition and Fees Deduction at a Glance summarizes the features of the tuition and fees deduction. Sample 1040x filled out Can You Claim the Deduction The following rules will help you determine if you can claim the tuition and fees deduction. Sample 1040x filled out Who Can Claim the Deduction Generally, you can claim the tuition and fees deduction if all three of the following requirements are met. Sample 1040x filled out You pay qualified education expenses of higher education. Sample 1040x filled out You pay the education expenses for an eligible student. Sample 1040x filled out The eligible student is yourself, your spouse, or your dependent for whom you claim an exemption on your tax return. Sample 1040x filled out The term “qualified education expenses” is defined later under Qualified Education Expenses . Sample 1040x filled out “Eligible student” is defined later under Who Is an Eligible Student . Sample 1040x filled out For more information on claiming the deduction for a dependent, see Who Can Claim a Dependent's Expenses , later. Sample 1040x filled out Table 6-1. Sample 1040x filled out Tuition and Fees Deduction at a Glance Do not rely on this table alone. Sample 1040x filled out Refer to the text for complete details. Sample 1040x filled out Question Answer What is the maximum benefit? You can reduce your income subject to tax by up to $4,000. Sample 1040x filled out What is the limit on modified adjusted gross income (MAGI)? $160,000 if married filing a joint return; $80,000 if single, head of household, or qualifying widow(er). Sample 1040x filled out Where is the deduction taken? As an adjustment to income on  Form 1040 or Form 1040A. Sample 1040x filled out For whom must the expenses be paid? A student enrolled in an eligible educational institution who is either: •you,  •your spouse, or  •your dependent for whom you claim an exemption. Sample 1040x filled out What tuition and fees are deductible? Tuition and fees required for enrollment or attendance at an eligible postsecondary educational institution, but not including personal, living, or family expenses, such as room and board. Sample 1040x filled out Who Cannot Claim the Deduction You cannot claim the tuition and fees deduction if any of the following apply. Sample 1040x filled out Your filing status is married filing separately. Sample 1040x filled out Another person can claim an exemption for you as a dependent on his or her tax return. Sample 1040x filled out You cannot take the deduction even if the other person does not actually claim that exemption. Sample 1040x filled out Your modified adjusted gross income (MAGI) is more than $80,000 ($160,000 if filing a joint return). Sample 1040x filled out You (or your spouse) were a nonresident alien for any part of 2013 and the nonresident alien did not elect to be treated as a resident alien for tax purposes. Sample 1040x filled out More information on nonresident aliens can be found in Publication 519. Sample 1040x filled out What Expenses Qualify The tuition and fees deduction is based on qualified education expenses you pay for yourself, your spouse, or a dependent for whom you claim an exemption on your tax return. Sample 1040x filled out Generally, the deduction is allowed for qualified education expenses paid in 2013 in connection with enrollment at an institution of higher education during 2013 or for an academic period beginning in 2013 or in the first 3 months of 2014. Sample 1040x filled out For example, if you paid $1,500 in December 2013 for qualified tuition for the spring 2014 semester beginning in January 2014, you may be able to use that $1,500 in figuring your 2013 deduction. Sample 1040x filled out Academic period. Sample 1040x filled out   An academic period includes a semester, trimester, quarter, or other period of study (such as a summer school session) as reasonably determined by an educational institution. Sample 1040x filled out In the case of an educational institution that uses credit hours or clock hours and does not have academic terms, each payment period can be treated as an academic period. Sample 1040x filled out Paid with borrowed funds. Sample 1040x filled out   You can claim a tuition and fees deduction for qualified education expenses paid with the proceeds of a loan. Sample 1040x filled out Use the expenses to figure the deduction for the year in which the expenses are paid, not the year in which the loan is repaid. Sample 1040x filled out Treat loan disbursements sent directly to the educational institution as paid on the date the institution credits the student's account. Sample 1040x filled out Student withdraws from class(es). Sample 1040x filled out   You can claim a tuition and fees deduction for qualified education expenses not refunded when a student withdraws. Sample 1040x filled out Qualified Education Expenses For purposes of the tuition and fees deduction, qualified education expenses are tuition and certain related expenses required for enrollment or attendance at an eligible educational institution. Sample 1040x filled out Eligible educational institution. Sample 1040x filled out   An eligible educational institution is any college, university, vocational school, or other postsecondary educational institution eligible to participate in a student aid program administered by the U. Sample 1040x filled out S. Sample 1040x filled out Department of Education. Sample 1040x filled out It includes virtually all accredited public, nonprofit, and proprietary (privately owned profit-making) postsecondary institutions. Sample 1040x filled out The educational institution should be able to tell you if it is an eligible educational institution. Sample 1040x filled out   Certain educational institutions located outside the United States also participate in the U. Sample 1040x filled out S. Sample 1040x filled out Department of Education's Federal Student Aid (FSA) programs. Sample 1040x filled out Related expenses. Sample 1040x filled out   Student-activity fees and expenses for course-related books, supplies, and equipment are included in qualified education expenses only if the fees and expenses must be paid to the institution as a condition of enrollment or attendance. Sample 1040x filled out Prepaid expenses. Sample 1040x filled out   Qualified education expenses paid in 2013 for an academic period that begins in the first three months of 2014 can be used in figuring an education credit for 2013 only. Sample 1040x filled out See Academic period , earlier. Sample 1040x filled out For example, you pay $2,000 in December 2013 for qualified tuition for the 2014 winter quarter that begins in January 2014, you can use that $2,000 in figuring an education credit for 2013 only (if you meet all the other requirements). Sample 1040x filled out You cannot use any amount you paid in 2012 or 2014 to figure the qualified education expenses you use to figure your 2013 education credit(s). Sample 1040x filled out In the following examples, assume that each student is an eligible student and each college or university an eligible educational institution. Sample 1040x filled out Example 1. Sample 1040x filled out Jackson is a sophomore in University V's degree program in dentistry. Sample 1040x filled out This year, in addition to tuition, he is required to pay a fee to the university for the rental of the dental equipment he will use in this program. Sample 1040x filled out Because the equipment rental fee must be paid to University V for enrollment and attendance, Jackson's equipment rental fee is a qualified education expense. Sample 1040x filled out Example 2. Sample 1040x filled out Donna and Charles, both first-year students at College W, are required to have certain books and other reading materials to use in their mandatory first-year classes. Sample 1040x filled out The college has no policy about how students should obtain these materials, but any student who purchases them from College W's bookstore will receive a bill directly from the college. Sample 1040x filled out Charles bought his books from a friend, so what he paid for them is not a qualified education expense. Sample 1040x filled out Donna bought hers at College W's bookstore. Sample 1040x filled out Although Donna paid College W directly for her first-year books and materials, her payment is not a qualified education expense because the books and materials are not required to be purchased from College W for enrollment or attendance at the institution. Sample 1040x filled out Example 3. Sample 1040x filled out When Marci enrolled at College X for her freshman year, she had to pay a separate student activity fee in addition to her tuition. Sample 1040x filled out This activity fee is required of all students, and is used solely to fund on-campus organizations and activities run by students, such as the student newspaper and the student government. Sample 1040x filled out No portion of the fee covers personal expenses. Sample 1040x filled out Although labeled as a student activity fee, the fee is required for Marci's enrollment and attendance at College X. Sample 1040x filled out Therefore, it is a qualified expense. Sample 1040x filled out No Double Benefit Allowed You cannot do any of the following. Sample 1040x filled out Deduct qualified education expenses you deduct under any other provision of the law, for example, as a business expense. Sample 1040x filled out Deduct qualified education expenses for a student on your income tax return if you or anyone else claims an American opportunity or lifetime learning credit for that same student in the same year. Sample 1040x filled out Deduct qualified education expenses that have been used to figure the tax-free portion of a distribution from a Coverdell education savings account (ESA) or a qualified tuition program (QTP). Sample 1040x filled out For a QTP, this applies only to the amount of tax-free earnings that were distributed, not to the recovery of contributions to the program. Sample 1040x filled out See Coordination With Tuition and Fees Deduction in chapter 8, Qualified Tuition Program, later. Sample 1040x filled out Deduct qualified education expenses that have been paid with tax-free interest on U. Sample 1040x filled out S. Sample 1040x filled out savings bonds (Form 8815). Sample 1040x filled out See Figuring the Tax-Free Amount in chapter 10, Education Savings Bond Program, later. Sample 1040x filled out Deduct qualified education expenses that have been paid with tax-free educational assistance, such as a scholarship, grant, or assistance provided by an employer. Sample 1040x filled out See the following section on Adjustments to Qualified Education Expenses. Sample 1040x filled out Adjustments to Qualified Education Expenses For each student, reduce the qualified education expenses paid by or on behalf of that student under the following rules. Sample 1040x filled out The result is the amount of adjusted qualified education expenses for each student. Sample 1040x filled out You must also reduce qualified education expenses by the other amounts referred to in No Double Benefit Allowed , earlier. Sample 1040x filled out Tax-free educational assistance. Sample 1040x filled out   For tax-free educational assistance received in 2013, reduce the qualified educational expenses for each academic period by the amount of tax-free educational assistance allocable to that academic period. Sample 1040x filled out See Academic period , earlier. Sample 1040x filled out   Some tax-free educational assistance received after 2013 may be treated as a refund of qualified education expenses paid in 2013. Sample 1040x filled out This tax-free educational assistance is any tax-free educational assistance received by you or anyone else after 2013 for qualified education expenses paid on behalf of a student in 2013 (or attributable to enrollment at an eligible educational institution during 2013). Sample 1040x filled out   If this tax-free educational assistance is received after 2013 but before you file your 2013 income tax return, see Refunds received after 2013 but before your income tax return is filed , later. Sample 1040x filled out If this tax-free educational assistance is received after 2013 and after you file your 2013 income tax return, see Refunds received after 2013 and after your income tax return is filed , later. Sample 1040x filled out   This tax-free education assistance includes: The tax-free part of scholarships and fellowships (see Tax-Free Scholarships and Fellowships in chapter 1, Scholarships, Fellowships, Grants, and Tuition Reductions), Pell grants (see Pell Grants and Other Title IV Need-Based Education Grants in chapter 1, Scholarships, Fellowships, Grants, and Tuition Reductions), Employer-provided educational assistance (see chapter 11, Employer-Provided Educational Assistance ), Veterans' educational assistance (see Veterans' Benefits in chapter 1, Scholarships, Fellowships, Grants, and Tuition Reductions), and Any other nontaxable (tax-free) payments (other than gifts or inheritances) received as educational assistance. Sample 1040x filled out Generally, any scholarship or fellowship is treated as tax free. Sample 1040x filled out However, a scholarship or fellowship is not treated as tax free to the extent the student includes it in gross income (if the student is required to file a tax return for the year the scholarship or fellowship is received) and either of the following is true. Sample 1040x filled out The scholarship or fellowship (or any part of it) must be applied (by its terms) to expenses (such as room and board) other than qualified education expenses as defined in Qualified education expenses in chapter 1, Scholarships, Fellowships, Grants, and Tuition Reductions. Sample 1040x filled out The scholarship or fellowship (or any part of it) may be applied (by its terms) to expenses (such as room and board) other than qualified education expenses as defined in Qualified education expenses in chapter 1, Scholarships, Fellowships, Grants, and Tuition Reductions. Sample 1040x filled out You may be able to increase the combined value of an education credit and certain educational assistance if the student includes some or all of the educational assistance in income in the year it is received. Sample 1040x filled out For details, see Adjustments to Qualified Education Expenses in chapters 2 and 3. Sample 1040x filled out Refunds. Sample 1040x filled out   A refund of qualified education expenses may reduce adjusted qualified education expenses for the tax year or require repayment (recapture) of a credit claimed in an earlier year. Sample 1040x filled out Some tax-free educational assistance received after 2013 may be treated as a refund. Sample 1040x filled out See Tax-free educational assistance , earlier. Sample 1040x filled out Refunds received in 2013. Sample 1040x filled out   For each student, figure the adjusted qualified education expenses for 2013 by adding all the qualified education expenses for 2013 and subtracting any refunds of those expenses received from the eligible educational institution during 2013. Sample 1040x filled out Refunds received after 2013 but before your income tax return is filed. Sample 1040x filled out   If anyone receives a refund after 2013 of qualified education expenses paid on behalf of a student in 2013 and the refund is paid before you file an income tax return for 2013, the amount of qualified education expenses for 2013 is reduced by the amount of the refund. Sample 1040x filled out Refunds received after 2013 and after your income tax return is filed. Sample 1040x filled out   If anyone receives a refund after 2013 of qualified education expenses paid on behalf of a student in 2013 and the refund is paid after you file an income tax return for 2013, you may need to repay some or all of the credit. Sample 1040x filled out See Credit recapture , later. Sample 1040x filled out Coordination with Coverdell education savings accounts and qualified tuition programs. Sample 1040x filled out   Reduce your qualified education expenses by any qualified education expenses used to figure the exclusion from gross income of (a) interest received under an education savings bond program, or (b) any distribution from a Coverdell education savings account or qualified tuition program (QTP). Sample 1040x filled out For a QTP, this applies only to the amount of tax-free earnings that were distributed, not to the recovery of contributions to the program. Sample 1040x filled out Credit recapture. Sample 1040x filled out    If any tax-free educational assistance for the qualified education expenses paid in 2013 or any refund of your qualified education expenses paid in 2013 is received after you file your 2013 income tax return, you must recapture (repay) any excess credit. Sample 1040x filled out You do this by refiguring the amount of your adjusted qualified education expenses for 2013 by reducing that amount by the amount of the refund or tax-free educational assistance. Sample 1040x filled out You then refigure your education credit(s) for 2013 and figure the amount by which your 2013 tax liability would have increased if you had claimed the refigured credit(s). Sample 1040x filled out Include that amount as an additional tax for the year the refund or tax-free assistance was received. Sample 1040x filled out Example. Sample 1040x filled out   You paid $3,500 of qualified education expenses in December 2013, and your child began college in January 2014. Sample 1040x filled out You claimed $3,500 as the tuition and fees deduction on your 2013 income tax return. Sample 1040x filled out The reduction reduced your taxable income by $3,500. Sample 1040x filled out Also, you claimed no tax credits in 2013. Sample 1040x filled out Your child withdrew from two classes and you received a refund of $2,000 in 2014 after you filed your 2013 tax return. Sample 1040x filled out Refigure your 2013 tuition and fees deduction using $1,500 of qualified education expense instead of the $3,500. Sample 1040x filled out The refigured tuition and fees deduction is $1,500. Sample 1040x filled out Do not file an amended 2013 tax return to account for this adjustment. Sample 1040x filled out Instead, include the difference of $2,000 (but only to the extent this difference would have increased your 2013 tax) on the “Other income” line of your 2014 Form 1040. Sample 1040x filled out You cannot file Form 1040A for 2014. Sample 1040x filled out Amounts that do not reduce qualified education expenses. Sample 1040x filled out   Do not reduce qualified education expenses by amounts paid with funds the student receives as: Payment for services, such as wages, A loan, A gift, An inheritance, or A withdrawal from the student's personal savings. Sample 1040x filled out   Do not reduce the qualified education expenses by any scholarship or fellowship reported as income on the student's tax return in the following situations. Sample 1040x filled out The use of the money is restricted, by the terms of the scholarship or fellowship, to costs of attendance (such as room and board) other than qualified education expenses as defined in Qualified education expenses in chapter 1, Scholarships, Fellowships, Grants, and Tuition Restrictions. Sample 1040x filled out The use of the money is not restricted. Sample 1040x filled out Example 1. Sample 1040x filled out In 2013, Jackie paid $3,000 for tuition and $5,000 for room and board at University X. Sample 1040x filled out The university did not require her to pay any fees in addition to her tuition in order to enroll in or attend classes. Sample 1040x filled out To help pay these costs, she was awarded a $2,000 scholarship and a $4,000 student loan. Sample 1040x filled out The terms of the scholarship state that it can be used to pay any of Jackie's college expenses. Sample 1040x filled out University X applies the $2,000 scholarship against Jackie's $8,000 total bill, and Jackie pays the $6,000 balance of her bill from University X with a combination of her student loan and her savings. Sample 1040x filled out Jackie does not report any portion of the scholarship as income on her tax return. Sample 1040x filled out In figuring the tuition and fees deduction, Jackie must reduce her qualified education expenses by the amount of the scholarship ($2,000) because she excluded the entire scholarship from her income. Sample 1040x filled out The student loan is not tax-free educational assistance, so she does not need to reduce her qualified expenses by any part of the loan proceeds. Sample 1040x filled out Jackie is treated as having paid $1,000 in qualified education expenses ($3,000 tuition – $2,000 scholarship) in 2013. Sample 1040x filled out Example 2. Sample 1040x filled out The facts are the same as in Example 1, except that Jackie reports her entire scholarship as income on her tax return. Sample 1040x filled out Because Jackie reported the entire $2,000 scholarship in her income, she does not need to reduce her qualified education expenses. Sample 1040x filled out Jackie is treated as having paid $3,000 in qualified education expenses. Sample 1040x filled out Expenses That Do Not Qualify Qualified education expenses do not include amounts paid for: Insurance, Medical expenses (including student health fees), Room and board, Transportation, or Similar personal, living, or family expenses. Sample 1040x filled out This is true even if the amount must be paid to the institution as a condition of enrollment or attendance. Sample 1040x filled out Sports, games, hobbies, and noncredit courses. Sample 1040x filled out   Qualified education expenses generally do not include expenses that relate to any course of instruction or other education that involves sports, games or hobbies, or any noncredit course. Sample 1040x filled out However, if the course of instruction or other education is part of the student's degree program, these expenses can qualify. Sample 1040x filled out Comprehensive or bundled fees. Sample 1040x filled out   Some eligible educational institutions combine all of their fees for an academic period into one amount. Sample 1040x filled out If you do not receive, or do not have access to, an allocation showing how much you paid for qualified education expenses and how much you paid for personal expenses, such as those listed above, contact the institution. Sample 1040x filled out The institution is required to make this allocation and provide you with the amount you paid (or were billed) for qualified education expenses on Form 1098-T. Sample 1040x filled out See Figuring the Deduction , later, for more information about Form 1098-T. Sample 1040x filled out Who Is an Eligible Student For purposes of the tuition and fees deduction, an eligible student is a student who is enrolled in one or more courses at an eligible educational institution (as defined under Qualified Education Expenses , earlier). Sample 1040x filled out Who Can Claim a Dependent's Expenses Generally, in order to claim the tuition and fees deduction for qualified education expenses for a dependent, you must: Have paid the expenses, and Claim an exemption for the student as a dependent. Sample 1040x filled out For you to be able to deduct qualified education expenses for your dependent, you must claim an exemption for that individual. Sample 1040x filled out You do this by listing your dependent's name and other required information on Form 1040 (or Form 1040A), line 6c. Sample 1040x filled out IF your dependent is an eligible student and you. Sample 1040x filled out . Sample 1040x filled out . Sample 1040x filled out AND. Sample 1040x filled out . Sample 1040x filled out . Sample 1040x filled out THEN. Sample 1040x filled out . Sample 1040x filled out . Sample 1040x filled out claim an exemption for your dependent you paid all qualified education expenses for your dependent only you can deduct the qualified education expenses that you paid. Sample 1040x filled out Your dependent cannot take a deduction. Sample 1040x filled out claim an exemption for your dependent your dependent paid all qualified education expenses no one is allowed to take a deduction. Sample 1040x filled out do not claim an exemption for your dependent you paid all qualified education expenses no one is allowed to take a deduction. Sample 1040x filled out do not claim an exemption for your dependent your dependent paid all qualified education expenses no one is allowed to take a deduction. Sample 1040x filled out Expenses paid by dependent. Sample 1040x filled out   If your dependent pays qualified education expenses, no one can take a tuition and fees deduction for those expenses. Sample 1040x filled out Neither you nor your dependent can deduct the expenses. Sample 1040x filled out For purposes of the tuition and fees deduction, you are not treated as paying any expenses actually paid by a dependent for whom you or anyone other than the dependent can claim an exemption. Sample 1040x filled out This rule applies even if you do not claim an exemption for your dependent on your tax return. Sample 1040x filled out Expenses paid by you. Sample 1040x filled out   If you claim an exemption for a dependent who is an eligible student, only you can include any expenses you paid when figuring your tuition and fees deduction. Sample 1040x filled out Expenses paid under divorce decree. Sample 1040x filled out   Qualified education expenses paid directly to an eligible educational institution for a student under a court-approved divorce decree are treated as paid by the student. Sample 1040x filled out Only the student would be eligible to take a tuition and fees deduction for that payment, and then only if no one else could claim an exemption for the student. Sample 1040x filled out Expenses paid by others. Sample 1040x filled out   Someone other than you, your spouse, or your dependent (such as a relative or former spouse) may make a payment directly to an eligible educational institution to pay for an eligible student's qualified education expenses. Sample 1040x filled out In this case, the student is treated as receiving the payment from the other person and, in turn, paying the institution. Sample 1040x filled out If you claim, or can claim, an exemption on your tax return for the student, you are not considered to have paid the expenses and you cannot deduct them. Sample 1040x filled out If the student is not a dependent, only the student can deduct payments made directly to the institution for his or her expenses. Sample 1040x filled out If the student is your dependent, no one can deduct the payments. Sample 1040x filled out Example. Sample 1040x filled out In 2013, Ms. Sample 1040x filled out Baker makes a payment directly to an eligible educational institution for her grandson Dan's qualified education expenses. Sample 1040x filled out For purposes of deducting tuition and fees, Dan is treated as receiving the money from his grandmother and, in turn, paying his own qualified education expenses. Sample 1040x filled out If an exemption cannot be claimed for Dan on anyone else's tax return, only Dan can claim a tuition and fees deduction for his grandmother's payment. Sample 1040x filled out If someone else can claim an exemption for Dan, no one will be allowed a deduction for Ms. Sample 1040x filled out Baker's payment. Sample 1040x filled out Tuition reduction. Sample 1040x filled out   When an eligible educational institution provides a reduction in tuition to an employee of the institution (or spouse or dependent child of an employee), the amount of the reduction may or may not be taxable. Sample 1040x filled out If it is taxable, the employee is treated as receiving a payment of that amount and, in turn, paying it to the educational institution on behalf of the student. Sample 1040x filled out For more information on tuition reductions, see Qualified Tuition Reduction , in chapter 1, Scholarships, Fellowships, Grants, and Tuition Reductions. Sample 1040x filled out Figuring the Deduction The maximum tuition and fees deduction in 2013 is $4,000, $2,000, or $0, depending on the amount of your MAGI. Sample 1040x filled out See Effect of the Amount of Your Income on the Amount of Your Deduction , later. Sample 1040x filled out Form 1098-T. Sample 1040x filled out   To help you figure your tuition and fees deduction, the student should receive Form 1098-T (see Appendix A for a completed example of Form 1098-T). Sample 1040x filled out Generally, an eligible educational institution (such as a college or university) must send Form 1098-T (or acceptable substitute) to each enrolled student by January 31, 2014. Sample 1040x filled out An institution may choose to report either payments received (box 1), or amounts billed (box 2), for qualified education expenses. Sample 1040x filled out However, the amount in boxes 1 and 2 of Form 1098-T might be different than what you paid. Sample 1040x filled out When figuring the deduction, use only the amounts you paid in 2013 for qualified education expenses. Sample 1040x filled out   In addition, Form 1098-T should give other information for that institution, such as adjustments made for prior years, the amount of scholarships or grants, reimbursements or refunds, and whether the student was enrolled at least half-time or was a graduate student. Sample 1040x filled out    The eligible educational institution may ask for a completed Form W-9S or similar statement to obtain the student's name, address, and taxpayer identification number. Sample 1040x filled out Effect of the Amount of Your Income on the Amount of Your Deduction If your MAGI is not more than $65,000 ($130,000 if you are married filing jointly), your maximum tuition and fees deduction is $4,000. Sample 1040x filled out If your MAGI is larger than $65,000 ($130,000 if you are married filing jointly), but is not more than $80,000 ($160,000 if you are married filing jointly), your maximum deduction is $2,000. Sample 1040x filled out No tuition and fees deduction is allowed if your MAGI is larger than $80,000 ($160,000 if you are married filing jointly). Sample 1040x filled out Modified adjusted gross income (MAGI). Sample 1040x filled out   For most taxpayers, MAGI is adjusted gross income (AGI) as figured on their federal income tax return before subtracting any deduction for tuition and fees. Sample 1040x filled out However, as discussed below, there may be other modifications. Sample 1040x filled out MAGI when using Form 1040A. Sample 1040x filled out   If you file Form 1040A, your MAGI is the AGI on line 22 of that form, figured without taking into account any amount on line 19 (tuition and fees deduction). Sample 1040x filled out MAGI when using Form 1040. Sample 1040x filled out   If you file Form 1040, your MAGI is the AGI on line 38 of that form, figured without taking into account any amount on line 34 (tuition and fees deduction) or line 35 (domestic production activities deduction), and modified by adding back any: Foreign earned income exclusion, Foreign housing exclusion, Foreign housing deduction, Exclusion of income by bona fide residents of American Samoa, and Exclusion of income by bona fide residents of Puerto Rico. Sample 1040x filled out   Table 6-2 shows how the amount of your MAGI can affect your tuition and fees deduction. Sample 1040x filled out   You can use Worksheet 6-1. Sample 1040x filled out MAGI for the Tuition and Fees Deduction , later, to figure your MAGI. Sample 1040x filled out Table 6-2. Sample 1040x filled out Effect of MAGI on Maximum Tuition and Fees Deduction IF your filing status is. Sample 1040x filled out . Sample 1040x filled out . Sample 1040x filled out AND your MAGI is. Sample 1040x filled out . Sample 1040x filled out . Sample 1040x filled out THEN your maximum tuition and fees deduction is. Sample 1040x filled out . Sample 1040x filled out . Sample 1040x filled out single,  head of household, or qualifying widow(er) not more than $65,000 $4,000. Sample 1040x filled out more than $65,000  but not more than $80,000 $2,000. Sample 1040x filled out more than $80,000 $0. Sample 1040x filled out married filing joint return not more than $130,000 $4,000. Sample 1040x filled out more than $130,000 but not more than $160,000 $2,000. Sample 1040x filled out more than $160,000 $0. Sample 1040x filled out Claiming the Deduction You claim a tuition and fees deduction by completing Form 8917 and submitting it with your Form 1040 or Form 1040A. Sample 1040x filled out Enter the deduction on Form 1040, line 34, or Form 1040A, line 19. Sample 1040x filled out A filled-in Form 8917 is shown at the end of this chapter. Sample 1040x filled out Illustrated Example Tim Pfister, a single taxpayer, enrolled full-time at a local college to earn a degree in engineering. Sample 1040x filled out This is the first year of his postsecondary education. Sample 1040x filled out During 2013, he paid $3,600 for his qualified 2013 tuition expense. Sample 1040x filled out Both he and the college meet all of the requirements for the tuition and fees deduction. Sample 1040x filled out Tim's total income (Form 1040, line 22) and MAGI are $26,000. Sample 1040x filled out He figures his deduction of $3,600 as shown on Form 8917, later. Sample 1040x filled out Worksheet 6-1. Sample 1040x filled out MAGI for the Tuition and Fees Deduction Use this worksheet if you are filing Form 2555, 2555-EZ, or 4563, or you are excluding income from sources within Puerto Rico. Sample 1040x filled out Before using this worksheet, you must complete Form 1040, lines 7 through 33, and figure any amount to be entered on the dotted line next to line 36. Sample 1040x filled out 1. Sample 1040x filled out Enter the amount from Form 1040, line 22   1. Sample 1040x filled out         2. Sample 1040x filled out Enter the total from Form 1040, lines 23 through 33   2. Sample 1040x filled out               3. Sample 1040x filled out Enter the total of any amounts entered on the dotted line next to Form 1040, line 36   3. Sample 1040x filled out               4. Sample 1040x filled out Add lines 2 and 3   4. Sample 1040x filled out         5. Sample 1040x filled out Subtract line 4 from line 1   5. Sample 1040x filled out         6. Sample 1040x filled out Enter your foreign earned income exclusion and/or housing  exclusion (Form 2555, line 45, or Form 2555-EZ, line 18)   6. Sample 1040x filled out         7. Sample 1040x filled out Enter your foreign housing deduction (Form 2555, line 50)   7. Sample 1040x filled out         8. Sample 1040x filled out Enter the amount of income from Puerto Rico you are excluding   8. Sample 1040x filled out         9. Sample 1040x filled out Enter the amount of income from American Samoa you are  excluding (Form 4563, line 15)   9. Sample 1040x filled out         10. Sample 1040x filled out Add lines 5 through 9. Sample 1040x filled out This is your modified adjusted gross income   10. Sample 1040x filled out     Note. Sample 1040x filled out If the amount on line 10 is more than $80,000 ($160,000 if married filing jointly),  you cannot take the deduction for tuition and fees. Sample 1040x filled out       This image is too large to be displayed in the current screen. Sample 1040x filled out Please click the link to view the image. Sample 1040x filled out Form 8917 for Tim Pfister Prev  Up  Next   Home   More Online Publications