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Turbo Tax 1040nr

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Turbo Tax 1040nr

Turbo tax 1040nr 26. Turbo tax 1040nr   Car Expenses and Other Employee Business Expenses Table of Contents What's New Introduction Useful Items - You may want to see: Travel ExpensesTraveling Away From Home Tax Home Temporary Assignment or Job What Travel Expenses Are Deductible? Travel in the United States Travel Outside the United States Conventions Entertainment Expenses50% Limit What Entertainment Expenses Are Deductible? What Entertainment Expenses Are Not Deductible? Gift Expenses Transportation ExpensesArmed Forces reservists. Turbo tax 1040nr Parking fees. Turbo tax 1040nr Advertising display on car. Turbo tax 1040nr Car pools. Turbo tax 1040nr Hauling tools or instruments. Turbo tax 1040nr Union members' trips from a union hall. Turbo tax 1040nr Car Expenses RecordkeepingHow To Prove Expenses How Long To Keep Records and Receipts How To ReportGifts. Turbo tax 1040nr Statutory employees. Turbo tax 1040nr Reimbursements Completing Forms 2106 and 2106-EZ Special Rules What's New Standard mileage rate. Turbo tax 1040nr  For 2013, the standard mileage rate for the cost of operating your car for business use is 56½ cents per mile. Turbo tax 1040nr Car expenses and use of the standard mileage rate are explained under Transportation Expenses , later. Turbo tax 1040nr Depreciation limits on cars, trucks, and vans. Turbo tax 1040nr  For 2013, the first-year limit on the total section 179 deduction, special depreciation allowance, and depreciation deduction for cars remains at $11,160 ($3,160 if you elect not to claim the special depreciation allowance). Turbo tax 1040nr For trucks and vans the first-year limit remains at $11,360 ($3,360 if you elect not to claim the special depreciation allowance). Turbo tax 1040nr For more information, see Depreciation limits in Publication 463. Turbo tax 1040nr Introduction You may be able to deduct the ordinary and necessary business-related expenses you have for: Travel, Entertainment, Gifts, or Transportation. Turbo tax 1040nr An ordinary expense is one that is common and accepted in your trade or business. Turbo tax 1040nr A necessary expense is one that is helpful and appropriate for your business. Turbo tax 1040nr An expense does not have to be required to be considered necessary. Turbo tax 1040nr This chapter explains the following. Turbo tax 1040nr What expenses are deductible. Turbo tax 1040nr How to report your expenses on your return. Turbo tax 1040nr What records you need to prove your expenses. Turbo tax 1040nr How to treat any expense reimbursements you may receive. Turbo tax 1040nr Who does not need to use this chapter. Turbo tax 1040nr   If you are an employee, you will not need to read this chapter if all of the following are true. Turbo tax 1040nr You fully accounted to your employer for your work-related expenses. Turbo tax 1040nr You received full reimbursement for your expenses. Turbo tax 1040nr Your employer required you to return any excess reimbursement and you did so. Turbo tax 1040nr There is no amount shown with a code “L” in box 12 of your Form W-2, Wage and Tax Statement. Turbo tax 1040nr If you meet all of these conditions, there is no need to show the expenses or the reimbursements on your return. Turbo tax 1040nr See Reimbursements , later, if you would like more information on reimbursements and accounting to your employer. Turbo tax 1040nr    If you meet these conditions and your employer included reimbursements on your Form W-2 in error, ask your employer for a corrected Form W-2. Turbo tax 1040nr Useful Items - You may want to see: Publication 463 Travel, Entertainment, Gift, and Car Expenses 535 Business Expenses Form (and Instructions) Schedule A (Form 1040) Itemized Deductions Schedule C (Form 1040) Profit or Loss From Business Schedule C-EZ (Form 1040) Net Profit From Business Schedule F (Form 1040) Profit or Loss From Farming Form 2106 Employee Business Expenses Form 2106-EZ Unreimbursed Employee Business Expenses Travel Expenses If you temporarily travel away from your tax home, you can use this section to determine if you have deductible travel expenses. Turbo tax 1040nr This section discusses: Traveling away from home, Tax home, Temporary assignment or job, and What travel expenses are deductible. Turbo tax 1040nr It also discusses the standard meal allowance, rules for travel inside and outside the United States, and deductible convention expenses. Turbo tax 1040nr Travel expenses defined. Turbo tax 1040nr   For tax purposes, travel expenses are the ordinary and necessary expenses (defined earlier) of traveling away from home for your business, profession, or job. Turbo tax 1040nr   You will find examples of deductible travel expenses in Table 26-1 . Turbo tax 1040nr Traveling Away From Home You are traveling away from home if: Your duties require you to be away from the general area of your tax home (defined later) substantially longer than an ordinary day's work, and You need to sleep or rest to meet the demands of your work while away from home. Turbo tax 1040nr This rest requirement is not satisfied by merely napping in your car. Turbo tax 1040nr You do not have to be away from your tax home for a whole day or from dusk to dawn as long as your relief from duty is long enough to get necessary sleep or rest. Turbo tax 1040nr Example 1. Turbo tax 1040nr You are a railroad conductor. Turbo tax 1040nr You leave your home terminal on a regularly scheduled round-trip run between two cities and return home 16 hours later. Turbo tax 1040nr During the run, you have 6 hours off at your turnaround point where you eat two meals and rent a hotel room to get necessary sleep before starting the return trip. Turbo tax 1040nr You are considered to be away from home. Turbo tax 1040nr Example 2. Turbo tax 1040nr You are a truck driver. Turbo tax 1040nr You leave your terminal and return to it later the same day. Turbo tax 1040nr You get an hour off at your turnaround point to eat. Turbo tax 1040nr Because you are not off to get necessary sleep and the brief time off is not an adequate rest period, you are not traveling away from home. Turbo tax 1040nr Members of the Armed Forces. Turbo tax 1040nr   If you are a member of the U. Turbo tax 1040nr S. Turbo tax 1040nr Armed Forces on a permanent duty assignment overseas, you are not traveling away from home. Turbo tax 1040nr You cannot deduct your expenses for meals and lodging. Turbo tax 1040nr You cannot deduct these expenses even if you have to maintain a home in the United States for your family members who are not allowed to accompany you overseas. Turbo tax 1040nr If you are transferred from one permanent duty station to another, you may have deductible moving expenses, which are explained in Publication 521, Moving Expenses. Turbo tax 1040nr    A naval officer assigned to permanent duty aboard a ship that has regular eating and living facilities has a tax home aboard ship for travel expense purposes. Turbo tax 1040nr Tax Home To determine whether you are traveling away from home, you must first determine the location of your tax home. Turbo tax 1040nr Generally, your tax home is your regular place of business or post of duty, regardless of where you maintain your family home. Turbo tax 1040nr It includes the entire city or general area in which your business or work is located. Turbo tax 1040nr If you have more than one regular place of business, your tax home is your main place of business. Turbo tax 1040nr See Main place of business or work , later. Turbo tax 1040nr If you do not have a regular or a main place of business because of the nature of your work, then your tax home may be the place where you regularly live. Turbo tax 1040nr See No main place of business or work , later. Turbo tax 1040nr If you do not have a regular or a main place of business or post of duty and there is no place where you regularly live, you are considered an itinerant (a transient) and your tax home is wherever you work. Turbo tax 1040nr As an itinerant, you cannot claim a travel expense deduction because you are never considered to be traveling away from home. Turbo tax 1040nr Main place of business or work. Turbo tax 1040nr   If you have more than one place of business or work, consider the following when determining which one is your main place of business or work. Turbo tax 1040nr The total time you ordinarily spend in each place. Turbo tax 1040nr The level of your business activity in each place. Turbo tax 1040nr Whether your income from each place is significant or insignificant. Turbo tax 1040nr Example. Turbo tax 1040nr You live in Cincinnati where you have a seasonal job for 8 months each year and earn $40,000. Turbo tax 1040nr You work the other 4 months in Miami, also at a seasonal job, and earn $15,000. Turbo tax 1040nr Cincinnati is your main place of work because you spend most of your time there and earn most of your income there. Turbo tax 1040nr No main place of business or work. Turbo tax 1040nr   You may have a tax home even if you do not have a regular or main place of business or work. Turbo tax 1040nr Your tax home may be the home where you regularly live. Turbo tax 1040nr Factors used to determine tax home. Turbo tax 1040nr   If you do not have a regular or main place of business or work, use the following three factors to determine where your tax home is. Turbo tax 1040nr You perform part of your business in the area of your main home and use that home for lodging while doing business in the area. Turbo tax 1040nr You have living expenses at your main home that you duplicate because your business requires you to be away from that home. Turbo tax 1040nr You have not abandoned the area in which both your historical place of lodging and your claimed main home are located; you have a member or members of your family living at your main home; or you often use that home for lodging. Turbo tax 1040nr   If you satisfy all three factors, your tax home is the home where you regularly live. Turbo tax 1040nr If you satisfy only two factors, you may have a tax home depending on all the facts and circumstances. Turbo tax 1040nr If you satisfy only one factor, you are an itinerant; your tax home is wherever you work and you cannot deduct travel expenses. Turbo tax 1040nr Example. Turbo tax 1040nr You are single and live in Boston in an apartment you rent. Turbo tax 1040nr You have worked for your employer in Boston for a number of years. Turbo tax 1040nr Your employer enrolls you in a 12-month executive training program. Turbo tax 1040nr You do not expect to return to work in Boston after you complete your training. Turbo tax 1040nr During your training, you do not do any work in Boston. Turbo tax 1040nr Instead, you receive classroom and on-the-job training throughout the United States. Turbo tax 1040nr You keep your apartment in Boston and return to it frequently. Turbo tax 1040nr You use your apartment to conduct your personal business. Turbo tax 1040nr You also keep up your community contacts in Boston. Turbo tax 1040nr When you complete your training, you are transferred to Los Angeles. Turbo tax 1040nr You do not satisfy factor (1) because you did not work in Boston. Turbo tax 1040nr You satisfy factor (2) because you had duplicate living expenses. Turbo tax 1040nr You also satisfy factor (3) because you did not abandon your apartment in Boston as your main home, you kept your community contacts, and you frequently returned to live in your apartment. Turbo tax 1040nr Therefore, you have a tax home in Boston. Turbo tax 1040nr Tax home different from family home. Turbo tax 1040nr   If you (and your family) do not live at your tax home (defined earlier), you cannot deduct the cost of traveling between your tax home and your family home. Turbo tax 1040nr You also cannot deduct the cost of meals and lodging while at your tax home. Turbo tax 1040nr See Example 1 . Turbo tax 1040nr   If you are working temporarily in the same city where you and your family live, you may be considered as traveling away from home. Turbo tax 1040nr See Example 2 . Turbo tax 1040nr Example 1. Turbo tax 1040nr You are a truck driver and you and your family live in Tucson. Turbo tax 1040nr You are employed by a trucking firm that has its terminal in Phoenix. Turbo tax 1040nr At the end of your long runs, you return to your home terminal in Phoenix and spend one night there before returning home. Turbo tax 1040nr You cannot deduct any expenses you have for meals and lodging in Phoenix or the cost of traveling from Phoenix to Tucson. Turbo tax 1040nr This is because Phoenix is your tax home. Turbo tax 1040nr Example 2. Turbo tax 1040nr Your family home is in Pittsburgh, where you work 12 weeks a year. Turbo tax 1040nr The rest of the year you work for the same employer in Baltimore. Turbo tax 1040nr In Baltimore, you eat in restaurants and sleep in a rooming house. Turbo tax 1040nr Your salary is the same whether you are in Pittsburgh or Baltimore. Turbo tax 1040nr Because you spend most of your working time and earn most of your salary in Baltimore, that city is your tax home. Turbo tax 1040nr You cannot deduct any expenses you have for meals and lodging there. Turbo tax 1040nr However, when you return to work in Pittsburgh, you are away from your tax home even though you stay at your family home. Turbo tax 1040nr You can deduct the cost of your round trip between Baltimore and Pittsburgh. Turbo tax 1040nr You can also deduct your part of your family's living expenses for meals and lodging while you are living and working in Pittsburgh. Turbo tax 1040nr Temporary Assignment or Job You may regularly work at your tax home and also work at another location. Turbo tax 1040nr It may not be practical to return to your tax home from this other location at the end of each work day. Turbo tax 1040nr Temporary assignment vs. Turbo tax 1040nr indefinite assignment. Turbo tax 1040nr   If your assignment or job away from your main place of work is temporary, your tax home does not change. Turbo tax 1040nr You are considered to be away from home for the whole period you are away from your main place of work. Turbo tax 1040nr You can deduct your travel expenses if they otherwise qualify for deduction. Turbo tax 1040nr Generally, a temporary assignment in a single location is one that is realistically expected to last (and does in fact last) for 1 year or less. Turbo tax 1040nr   However, if your assignment or job is indefinite, the location of the assignment or job becomes your new tax home and you cannot deduct your travel expenses while there. Turbo tax 1040nr An assignment or job in a single location is considered indefinite if it is realistically expected to last for more than 1 year, whether or not it actually lasts for more than 1 year. Turbo tax 1040nr   If your assignment is indefinite, you must include in your income any amounts you receive from your employer for living expenses, even if they are called travel allowances and you account to your employer for them. Turbo tax 1040nr You may be able to deduct the cost of relocating to your new tax home as a moving expense. Turbo tax 1040nr See Publication 521 for more information. Turbo tax 1040nr Exception for federal crime investigations or prosecutions. Turbo tax 1040nr   If you are a federal employee participating in a federal crime investigation or prosecution, you are not subject to the 1-year rule. Turbo tax 1040nr This means you may be able to deduct travel expenses even if you are away from your tax home for more than 1 year, provided you meet the other requirements for deductibility. Turbo tax 1040nr   For you to qualify, the Attorney General (or his or her designee) must certify that you are traveling: For the federal government, In a temporary duty status, and To investigate or prosecute, or provide support services for the investigation or prosecution of a federal crime. Turbo tax 1040nr Determining temporary or indefinite. Turbo tax 1040nr   You must determine whether your assignment is temporary or indefinite when you start work. Turbo tax 1040nr If you expect an assignment or job to last for 1 year or less, it is temporary unless there are facts and circumstances that indicate otherwise. Turbo tax 1040nr An assignment or job that is initially temporary may become indefinite due to changed circumstances. Turbo tax 1040nr A series of assignments to the same location, all for short periods but that together cover a long period, may be considered an indefinite assignment. Turbo tax 1040nr Going home on days off. Turbo tax 1040nr   If you go back to your tax home from a temporary assignment on your days off, you are not considered away from home while you are in your hometown. Turbo tax 1040nr You cannot deduct the cost of your meals and lodging there. Turbo tax 1040nr However, you can deduct your travel expenses, including meals and lodging, while traveling between your temporary place of work and your tax home. Turbo tax 1040nr You can claim these expenses up to the amount it would have cost you to stay at your temporary place of work. Turbo tax 1040nr   If you keep your hotel room during your visit home, you can deduct the cost of your hotel room. Turbo tax 1040nr In addition, you can deduct your expenses of returning home up to the amount you would have spent for meals had you stayed at your temporary place of work. Turbo tax 1040nr Probationary work period. Turbo tax 1040nr   If you take a job that requires you to move, with the understanding that you will keep the job if your work is satisfactory during a probationary period, the job is indefinite. Turbo tax 1040nr You cannot deduct any of your expenses for meals and lodging during the probationary period. Turbo tax 1040nr What Travel Expenses Are Deductible? Once you have determined that you are traveling away from your tax home, you can determine what travel expenses are deductible. Turbo tax 1040nr You can deduct ordinary and necessary expenses you have when you travel away from home on business. Turbo tax 1040nr The type of expense you can deduct depends on the facts and your circumstances. Turbo tax 1040nr Table 26-1 summarizes travel expenses you may be able to deduct. Turbo tax 1040nr You may have other deductible travel expenses that are not covered there, depending on the facts and your circumstances. Turbo tax 1040nr When you travel away from home on business, you should keep records of all the expenses you have and any advances you receive from your employer. Turbo tax 1040nr You can use a log, diary, notebook, or any other written record to keep track of your expenses. Turbo tax 1040nr The types of expenses you need to record, along with supporting documentation, are described in Table 26-2 , later. Turbo tax 1040nr Separating costs. Turbo tax 1040nr   If you have one expense that includes the costs of meals, entertainment, and other services (such as lodging or transportation), you must allocate that expense between the cost of meals and entertainment and the cost of other services. Turbo tax 1040nr You must have a reasonable basis for making this allocation. Turbo tax 1040nr For example, you must allocate your expenses if a hotel includes one or more meals in its room charge. Turbo tax 1040nr Travel expenses for another individual. Turbo tax 1040nr   If a spouse, dependent, or other individual goes with you (or your employee) on a business trip or to a business convention, you generally cannot deduct his or her travel expenses. Turbo tax 1040nr Employee. Turbo tax 1040nr   You can deduct the travel expenses of someone who goes with you if that person: Is your employee, Has a bona fide business purpose for the travel, and Would otherwise be allowed to deduct the travel expenses. Turbo tax 1040nr Business associate. Turbo tax 1040nr   If a business associate travels with you and meets the conditions in (2) and (3) above, you can deduct the travel expenses you have for that person. Turbo tax 1040nr A business associate is someone with whom you could reasonably expect to engage or deal in the active conduct of your business. Turbo tax 1040nr A business associate can be a current or prospective (likely to become) customer, client, supplier, employee, agent, partner, or professional advisor. Turbo tax 1040nr Bona fide business purpose. Turbo tax 1040nr   A bona fide business purpose exists if you can prove a real business purpose for the individual's presence. Turbo tax 1040nr Incidental services, such as typing notes or assisting in entertaining customers, are not enough to make the expenses deductible. Turbo tax 1040nr Example. Turbo tax 1040nr Jerry drives to Chicago on business and takes his wife, Linda, with him. Turbo tax 1040nr Linda is not Jerry's employee. Turbo tax 1040nr Linda occasionally types notes, performs similar services, and accompanies Jerry to luncheons and dinners. Turbo tax 1040nr The performance of these services does not establish that her presence on the trip is necessary to the conduct of Jerry's business. Turbo tax 1040nr Her expenses are not deductible. Turbo tax 1040nr Jerry pays $199 a day for a double room. Turbo tax 1040nr A single room costs $149 a day. Turbo tax 1040nr He can deduct the total cost of driving his car to and from Chicago, but only $149 a day for his hotel room. Turbo tax 1040nr If he uses public transportation, he can deduct only his fare. Turbo tax 1040nr Table 26-1. Turbo tax 1040nr Travel Expenses You Can Deduct This chart summarizes expenses you can deduct when you travel away from home for business purposes. Turbo tax 1040nr IF you have expenses for. Turbo tax 1040nr . Turbo tax 1040nr . Turbo tax 1040nr THEN you can deduct the cost of. Turbo tax 1040nr . Turbo tax 1040nr . Turbo tax 1040nr transportation travel by airplane, train, bus, or car between your home and your business destination. Turbo tax 1040nr If you were provided with a ticket or you are riding free as a result of a frequent traveler or similar program, your cost is zero. Turbo tax 1040nr If you travel by ship, see Luxury Water Travel and Cruise ships (under Conventions) in Publication 463 for additional rules and limits. Turbo tax 1040nr taxi, commuter bus, and airport limousine fares for these and other types of transportation that take you between: The airport or station and your hotel, and The hotel and the work location of your customers or clients, your business meeting place, or your temporary work location. Turbo tax 1040nr baggage and shipping sending baggage and sample or display material between your regular and temporary work locations. Turbo tax 1040nr car operating and maintaining your car when traveling away from home on business. Turbo tax 1040nr You can deduct actual expenses or the standard mileage rate as well as business-related tolls and parking. Turbo tax 1040nr If you rent a car while away from home on business, you can deduct only the business-use portion of the expenses. Turbo tax 1040nr lodging and meals your lodging and meals if your business trip is overnight or long enough that you need to stop for sleep or rest to properly perform your duties. Turbo tax 1040nr Meals include amounts spent for food, beverages, taxes, and related tips. Turbo tax 1040nr See Meals and Incidental Expenses for additional rules and limits. Turbo tax 1040nr cleaning dry cleaning and laundry. Turbo tax 1040nr telephone business calls while on your business trip. Turbo tax 1040nr This includes business communication by fax machine or other communication devices. Turbo tax 1040nr tips tips you pay for any expenses in this chart. Turbo tax 1040nr other other similar ordinary and necessary expenses related to your business travel. Turbo tax 1040nr These expenses might include transportation to or from a business meal, public stenographer's fees, computer rental fees, and operating and maintaining a house trailer. Turbo tax 1040nr Meals and Incidental Expenses You can deduct the cost of meals in either of the following situations. Turbo tax 1040nr It is necessary for you to stop for substantial sleep or rest to properly perform your duties while traveling away from home on business. Turbo tax 1040nr The meal is business-related entertainment. Turbo tax 1040nr Business-related entertainment is discussed under Entertainment Expenses , later. Turbo tax 1040nr The following discussion deals only with meals (and incidental expenses) that are not business-related entertainment. Turbo tax 1040nr Lavish or extravagant. Turbo tax 1040nr   You cannot deduct expenses for meals that are lavish or extravagant. Turbo tax 1040nr An expense is not considered lavish or extravagant if it is reasonable based on the facts and circumstances. Turbo tax 1040nr Expenses will not be disallowed merely because they are more than a fixed dollar amount or take place at deluxe restaurants, hotels, nightclubs, or resorts. Turbo tax 1040nr 50% limit on meals. Turbo tax 1040nr   You can figure your meal expenses using either of the following methods. Turbo tax 1040nr Actual cost. Turbo tax 1040nr The standard meal allowance. Turbo tax 1040nr Both of these methods are explained below. Turbo tax 1040nr But, regardless of the method you use, you generally can deduct only 50% of the unreimbursed cost of your meals. Turbo tax 1040nr   If you are reimbursed for the cost of your meals, how you apply the 50% limit depends on whether your employer's reimbursement plan was accountable or nonaccountable. Turbo tax 1040nr If you are not reimbursed, the 50% limit applies whether the unreimbursed meal expense is for business travel or business entertainment. Turbo tax 1040nr The 50% limit is explained later under Entertainment Expenses . Turbo tax 1040nr Accountable and nonaccountable plans are discussed later under Reimbursements . Turbo tax 1040nr Actual cost. Turbo tax 1040nr   You can use the actual cost of your meals to figure the amount of your expense before reimbursement and application of the 50% deduction limit. Turbo tax 1040nr If you use this method, you must keep records of your actual cost. Turbo tax 1040nr Standard meal allowance. Turbo tax 1040nr   Generally, you can use the “standard meal allowance” method as an alternative to the actual cost method. Turbo tax 1040nr It allows you to use a set amount for your daily meals and incidental expenses (M&IE), instead of keeping records of your actual costs. Turbo tax 1040nr The set amount varies depending on where and when you travel. Turbo tax 1040nr In this chapter, “standard meal allowance” refers to the federal rate for M&IE, discussed later under Amount of standard meal allowance . Turbo tax 1040nr If you use the standard meal allowance, you still must keep records to prove the time, place, and business purpose of your travel. Turbo tax 1040nr See Recordkeeping , later. Turbo tax 1040nr Incidental expenses. Turbo tax 1040nr   The term “incidental expenses” means fees and tips given to porters, baggage carriers, hotel staff, and staff on ships. Turbo tax 1040nr Incidental expenses do not include expenses for laundry, cleaning and pressing of clothing, lodging taxes, costs of telegrams or telephone calls, transportation between places of lodging or business and places where meals are taken, or the mailing cost of filing travel vouchers and paying employer-sponsored charge card billings. Turbo tax 1040nr Incidental expenses only method. Turbo tax 1040nr   You can use an optional method (instead of actual cost) for deducting incidental expenses only. Turbo tax 1040nr The amount of the deduction is $5 a day. Turbo tax 1040nr You can use this method only if you did not pay or incur any meal expenses. Turbo tax 1040nr You cannot use this method on any day that you use the standard meal allowance. Turbo tax 1040nr    Federal employees should refer to the Federal Travel Regulations at  www. Turbo tax 1040nr gsa. Turbo tax 1040nr gov. Turbo tax 1040nr Find “What GSA Offers” and click on “Regulations: FMR, FTR, & FAR” for Federal Travel Regulation (FTR) for changes affecting claims for reimbursement. Turbo tax 1040nr 50% limit may apply. Turbo tax 1040nr   If you use the standard meal allowance method for meal expenses and you are not reimbursed or you are reimbursed under a nonaccountable plan, you can generally deduct only 50% of the standard meal allowance. Turbo tax 1040nr If you are reimbursed under an accountable plan and you are deducting amounts that are more than your reimbursements, you can deduct only 50% of the excess amount. Turbo tax 1040nr The 50% limit is explained later under Entertainment Expenses . Turbo tax 1040nr Accountable and nonaccountable plans are discussed later under Reimbursements . Turbo tax 1040nr There is no optional standard lodging amount similar to the standard meal allowance. Turbo tax 1040nr Your allowable lodging expense deduction is your actual cost. Turbo tax 1040nr Who can use the standard meal allowance. Turbo tax 1040nr   You can use the standard meal allowance whether you are an employee or self-employed, and whether or not you are reimbursed for your traveling expenses. Turbo tax 1040nr   Use of the standard meal allowance for other travel. Turbo tax 1040nr    You can use the standard meal allowance to figure your meal expenses when you travel in connection with investment and other income-producing property. Turbo tax 1040nr You can also use it to figure your meal expenses when you travel for qualifying educational purposes. Turbo tax 1040nr You cannot use the standard meal allowance to figure the cost of your meals when you travel for medical or charitable purposes. Turbo tax 1040nr Amount of standard meal allowance. Turbo tax 1040nr   The standard meal allowance is the federal M&IE rate. Turbo tax 1040nr For travel in 2013, the daily rate for most small localities in the United States is $46. Turbo tax 1040nr   Most major cities and many other localities in the United States are designated as high-cost areas, qualifying for higher standard meal allowances. Turbo tax 1040nr You can find this information (organized by state) on the Internet at www. Turbo tax 1040nr gsa. Turbo tax 1040nr gov. Turbo tax 1040nr Click on “Per Diem Rates,” then select “2013” for the period January 1, 2013 – September 30, 2013, and select “2014” for the period October 1, 2013 – December 31, 2013. Turbo tax 1040nr However, you can apply the rates in effect before October 1, 2013, for expenses of all travel within the United States for 2013 instead of the updated rates. Turbo tax 1040nr You must consistently use either the rates for the first 9 months for all of 2013 or the updated rates for the period of October 1, 2013, through December 31, 2013. Turbo tax 1040nr   If you travel to more than one location in one day, use the rate in effect for the area where you stop for sleep or rest. Turbo tax 1040nr If you work in the transportation industry, however, see Special rate for transportation workers , later. Turbo tax 1040nr Standard meal allowance for areas outside the continental United States. Turbo tax 1040nr    The standard meal allowance rates above do not apply to travel in Alaska, Hawaii, or any other location outside the continental United States. Turbo tax 1040nr The Department of Defense establishes per diem rates for Alaska, Hawaii, Puerto Rico, American Samoa, Guam, Midway, the Northern Mariana Islands, the U. Turbo tax 1040nr S. Turbo tax 1040nr Virgin Islands, Wake Island, and other non-foreign areas outside the continental United States. Turbo tax 1040nr The Department of State establishes per diem rates for all other foreign areas. Turbo tax 1040nr    You can access per diem rates for non-foreign areas outside the continental United States at: www. Turbo tax 1040nr defensetravel. Turbo tax 1040nr dod. Turbo tax 1040nr mil/site/perdiemCalc. Turbo tax 1040nr cfm. Turbo tax 1040nr You can access all other foreign per diem rates at www. Turbo tax 1040nr state. Turbo tax 1040nr gov/travel/. Turbo tax 1040nr Click on “Travel Per Diem Allowances for Foreign Areas” under “Foreign Per Diem Rates,” to obtain the latest foreign per diem rates. Turbo tax 1040nr Special rate for transportation workers. Turbo tax 1040nr   You can use a special standard meal allowance if you work in the transportation industry. Turbo tax 1040nr You are in the transportation industry if your work: Directly involves moving people or goods by airplane, barge, bus, ship, train, or truck, and Regularly requires you to travel away from home and, during any single trip, usually involves travel to areas eligible for different standard meal allowance rates. Turbo tax 1040nr If this applies to you, you can claim a standard daily meal allowance of $59 ($65 for travel outside the continental United States). Turbo tax 1040nr   Using the special rate for transportation workers eliminates the need for you to determine the standard meal allowance for every area where you stop for sleep or rest. Turbo tax 1040nr If you choose to use the special rate for any trip, you must use the special rate (and not use the regular standard meal allowance rates) for all trips you take that year. Turbo tax 1040nr Travel for days you depart and return. Turbo tax 1040nr   For both the day you depart for and the day you return from a business trip, you must prorate the standard meal allowance (figure a reduced amount for each day). Turbo tax 1040nr You can do so by one of two methods. Turbo tax 1040nr Method 1: You can claim 3/4 of the standard meal allowance. Turbo tax 1040nr Method 2: You can prorate using any method that you consistently apply and that is in accordance with reasonable business practice. Turbo tax 1040nr Example. Turbo tax 1040nr Jen is employed in New Orleans as a convention planner. Turbo tax 1040nr In March, her employer sent her on a 3-day trip to Washington, DC, to attend a planning seminar. Turbo tax 1040nr She left her home in New Orleans at 10 a. Turbo tax 1040nr m. Turbo tax 1040nr on Wednesday and arrived in Washington, DC, at 5:30 p. Turbo tax 1040nr m. Turbo tax 1040nr After spending two nights there, she flew back to New Orleans on Friday and arrived back home at 8:00 p. Turbo tax 1040nr m. Turbo tax 1040nr Jen's employer gave her a flat amount to cover her expenses and included it with her wages. Turbo tax 1040nr Under Method 1, Jen can claim 2½ days of the standard meal allowance for Washington, DC: 3/4 of the daily rate for Wednesday and Friday (the days she departed and returned), and the full daily rate for Thursday. Turbo tax 1040nr Under Method 2, Jen could also use any method that she applies consistently and that is in accordance with reasonable business practice. Turbo tax 1040nr For example, she could claim 3 days of the standard meal allowance even though a federal employee would have to use Method 1 and be limited to only 2½ days. Turbo tax 1040nr Travel in the United States The following discussion applies to travel in the United States. Turbo tax 1040nr For this purpose, the United States includes only the 50 states and the District of Columbia. Turbo tax 1040nr The treatment of your travel expenses depends on how much of your trip was business related and on how much of your trip occurred within the United States. Turbo tax 1040nr See Part of Trip Outside the United States , later. Turbo tax 1040nr Trip Primarily for Business You can deduct all your travel expenses if your trip was entirely business related. Turbo tax 1040nr If your trip was primarily for business and, while at your business destination, you extended your stay for a vacation, made a personal side trip, or had other personal activities, you can deduct your business-related travel expenses. Turbo tax 1040nr These expenses include the travel costs of getting to and from your business destination and any business-related expenses at your business destination. Turbo tax 1040nr Example. Turbo tax 1040nr You work in Atlanta and take a business trip to New Orleans in May. Turbo tax 1040nr On your way home, you stop in Mobile to visit your parents. Turbo tax 1040nr You spend $1,996 for the 9 days you are away from home for travel, meals, lodging, and other travel expenses. Turbo tax 1040nr If you had not stopped in Mobile, you would have been gone only 6 days, and your total cost would have been $1,696. Turbo tax 1040nr You can deduct $1,696 for your trip, including the cost of round-trip transportation to and from New Orleans. Turbo tax 1040nr The deduction for your meals is subject to the 50% limit on meals mentioned earlier. Turbo tax 1040nr Trip Primarily for Personal Reasons If your trip was primarily for personal reasons, such as a vacation, the entire cost of the trip is a nondeductible personal expense. Turbo tax 1040nr However, you can deduct any expenses you have while at your destination that are directly related to your business. Turbo tax 1040nr A trip to a resort or on a cruise ship may be a vacation even if the promoter advertises that it is primarily for business. Turbo tax 1040nr The scheduling of incidental business activities during a trip, such as viewing videotapes or attending lectures dealing with general subjects, will not change what is really a vacation into a business trip. Turbo tax 1040nr Part of Trip Outside the United States If part of your trip is outside the United States, use the rules described later under Travel Outside the United States for that part of the trip. Turbo tax 1040nr For the part of your trip that is inside the United States, use the rules for travel in the United States. Turbo tax 1040nr Travel outside the United States does not include travel from one point in the United States to another point in the United States. Turbo tax 1040nr The following discussion can help you determine whether your trip was entirely within the United States. Turbo tax 1040nr Public transportation. Turbo tax 1040nr   If you travel by public transportation, any place in the United States where that vehicle makes a scheduled stop is a point in the United States. Turbo tax 1040nr Once the vehicle leaves the last scheduled stop in the United States on its way to a point outside the United States, you apply the rules under Travel Outside the United States . Turbo tax 1040nr Example. Turbo tax 1040nr You fly from New York to Puerto Rico with a scheduled stop in Miami. Turbo tax 1040nr You return to New York nonstop. Turbo tax 1040nr The flight from New York to Miami is in the United States, so only the flight from Miami to Puerto Rico is outside the United States. Turbo tax 1040nr Because there are no scheduled stops between Puerto Rico and New York, all of the return trip is outside the United States. Turbo tax 1040nr Private car. Turbo tax 1040nr   Travel by private car in the United States is travel between points in the United States, even when you are on your way to a destination outside the United States. Turbo tax 1040nr Example. Turbo tax 1040nr You travel by car from Denver to Mexico City and return. Turbo tax 1040nr Your travel from Denver to the border and from the border back to Denver is travel in the United States, and the rules in this section apply. Turbo tax 1040nr The rules under Travel Outside the United States apply to your trip from the border to Mexico City and back to the border. Turbo tax 1040nr Travel Outside the United States If any part of your business travel is outside the United States, some of your deductions for the cost of getting to and from your destination may be limited. Turbo tax 1040nr For this purpose, the United States includes only the 50 states and the District of Columbia. Turbo tax 1040nr How much of your travel expenses you can deduct depends in part upon how much of your trip outside the United States was business related. Turbo tax 1040nr See chapter 1 of Publication 463 for information on luxury water travel. Turbo tax 1040nr Travel Entirely for Business or Considered Entirely for Business You can deduct all your travel expenses of getting to and from your business destination if your trip is entirely for business or considered entirely for business. Turbo tax 1040nr Travel entirely for business. Turbo tax 1040nr   If you travel outside the United States and you spend the entire time on business activities, you can deduct all of your travel expenses. Turbo tax 1040nr Travel considered entirely for business. Turbo tax 1040nr   Even if you did not spend your entire time on business activities, your trip is considered entirely for business if you meet at least one of the following four exceptions. Turbo tax 1040nr Exception 1 - No substantial control. Turbo tax 1040nr   Your trip is considered entirely for business if you did not have substantial control over arranging the trip. Turbo tax 1040nr The fact that you control the timing of your trip does not, by itself, mean that you have substantial control over arranging your trip. Turbo tax 1040nr   You do not have substantial control over your trip if you: Are an employee who was reimbursed or paid a travel expense allowance, Are not related to your employer, and Are not a managing executive. Turbo tax 1040nr    “Related to your employer” is defined later in this chapter under Per Diem and Car Allowances . Turbo tax 1040nr   A “managing executive” is an employee who has the authority and responsibility, without being subject to the veto of another, to decide on the need for the business travel. Turbo tax 1040nr    A self-employed person generally has substantial control over arranging business trips. Turbo tax 1040nr Exception 2 - Outside United States no more than a week. Turbo tax 1040nr   Your trip is considered entirely for business if you were outside the United States for a week or less, combining business and nonbusiness activities. Turbo tax 1040nr One week means 7 consecutive days. Turbo tax 1040nr In counting the days, do not count the day you leave the United States, but do count the day you return to the United States. Turbo tax 1040nr Exception 3 - Less than 25% of time on personal activities. Turbo tax 1040nr   Your trip is considered entirely for business if: You were outside the United States for more than a week, and You spent less than 25% of the total time you were outside the United States on nonbusiness activities. Turbo tax 1040nr For this purpose, count both the day your trip began and the day it ended. Turbo tax 1040nr Exception 4 - Vacation not a major consideration. Turbo tax 1040nr   Your trip is considered entirely for business if you can establish that a personal vacation was not a major consideration, even if you have substantial control over arranging the trip. Turbo tax 1040nr Travel Primarily for Business If you travel outside the United States primarily for business but spend some of your time on nonbusiness activities, you generally cannot deduct all of your travel expenses. Turbo tax 1040nr You can only deduct the business portion of your cost of getting to and from your destination. Turbo tax 1040nr You must allocate the costs between your business and nonbusiness activities to determine your deductible amount. Turbo tax 1040nr These travel allocation rules are discussed in chapter 1 of Publication 463. Turbo tax 1040nr You do not have to allocate your travel expense deduction if you meet one of the four exceptions listed earlier under Travel considered entirely for business. Turbo tax 1040nr In those cases, you can deduct the total cost of getting to and from your destination. Turbo tax 1040nr Travel Primarily for Personal Reasons If you travel outside the United States primarily for vacation or for investment purposes, the entire cost of the trip is a nondeductible personal expense. Turbo tax 1040nr If you spend some time attending brief professional seminars or a continuing education program, you can deduct your registration fees and other expenses you have that are directly related to your business. Turbo tax 1040nr Conventions You can deduct your travel expenses when you attend a convention if you can show that your attendance benefits your trade or business. Turbo tax 1040nr You cannot deduct the travel expenses for your family. Turbo tax 1040nr If the convention is for investment, political, social, or other purposes unrelated to your trade or business, you cannot deduct the expenses. Turbo tax 1040nr Your appointment or election as a delegate does not, in itself, determine whether you can deduct travel expenses. Turbo tax 1040nr You can deduct your travel expenses only if your attendance is connected to your own trade or business. Turbo tax 1040nr Convention agenda. Turbo tax 1040nr   The convention agenda or program generally shows the purpose of the convention. Turbo tax 1040nr You can show your attendance at the convention benefits your trade or business by comparing the agenda with the official duties and responsibilities of your position. Turbo tax 1040nr The agenda does not have to deal specifically with your official duties and responsibilities; it will be enough if the agenda is so related to your position that it shows your attendance was for business purposes. Turbo tax 1040nr Conventions held outside the North American area. Turbo tax 1040nr    See chapter 1 of Publication 463 for information on conventions held outside the North American area. Turbo tax 1040nr Entertainment Expenses You may be able to deduct business-related entertainment expenses you have for entertaining a client, customer, or employee. Turbo tax 1040nr You can deduct entertainment expenses only if they are both ordinary and necessary (defined earlier in the Introduction ) and meet one of the following tests. Turbo tax 1040nr Directly-related test. Turbo tax 1040nr Associated test. Turbo tax 1040nr Both of these tests are explained in chapter 2 of Publication 463. Turbo tax 1040nr The amount you can deduct for entertainment expenses may be limited. Turbo tax 1040nr Generally, you can deduct only 50% of your unreimbursed entertainment expenses. Turbo tax 1040nr This limit is discussed next. Turbo tax 1040nr 50% Limit In general, you can deduct only 50% of your business-related meal and entertainment expenses. Turbo tax 1040nr (If you are subject to the Department of Transportation's “hours of service” limits, you can deduct 80% of your business-related meal and entertainment expenses. Turbo tax 1040nr See Individuals subject to “hours of service” limits , later. Turbo tax 1040nr ) The 50% limit applies to employees or their employers, and to self-employed persons (including independent contractors) or their clients, depending on whether the expenses are reimbursed. Turbo tax 1040nr Figure 26-A summarizes the general rules explained in this section. Turbo tax 1040nr The 50% limit applies to business meals or entertainment expenses you have while: Traveling away from home (whether eating alone or with others) on business, Entertaining customers at your place of business, a restaurant, or other location, or Attending a business convention or reception, business meeting, or business luncheon at a club. Turbo tax 1040nr Included expenses. Turbo tax 1040nr   Expenses subject to the 50% limit include: Taxes and tips relating to a business meal or entertainment activity, Cover charges for admission to a nightclub, Rent paid for a room in which you hold a dinner or cocktail party, and Amounts paid for parking at a sports arena. Turbo tax 1040nr However, the cost of transportation to and from a business meal or a business-related entertainment activity is not subject to the 50% limit. Turbo tax 1040nr Application of 50% limit. Turbo tax 1040nr   The 50% limit on meal and entertainment expenses applies if the expense is otherwise deductible and is not covered by one of the exceptions discussed later in this section. Turbo tax 1040nr   The 50% limit also applies to certain meal and entertainment expenses that are not business related. Turbo tax 1040nr It applies to meal and entertainment expenses incurred for the production of income, including rental or royalty income. Turbo tax 1040nr It also applies to the cost of meals included in deductible educational expenses. Turbo tax 1040nr When to apply the 50% limit. Turbo tax 1040nr   You apply the 50% limit after determining the amount that would otherwise qualify for a deduction. Turbo tax 1040nr You first have to determine the amount of meal and entertainment expenses that would be deductible under the other rules discussed in this chapter. Turbo tax 1040nr Example 1. Turbo tax 1040nr You spend $200 for a business-related meal. Turbo tax 1040nr If $110 of that amount is not allowable because it is lavish and extravagant, the remaining $90 is subject to the 50% limit. Turbo tax 1040nr Your deduction cannot be more than $45 (. Turbo tax 1040nr 50 × $90). Turbo tax 1040nr Example 2. Turbo tax 1040nr You purchase two tickets to a concert and give them to a client. Turbo tax 1040nr You purchased the tickets through a ticket agent. Turbo tax 1040nr You paid $200 for the two tickets, which had a face value of $80 each ($160 total). Turbo tax 1040nr Your deduction cannot be more than $80 (. Turbo tax 1040nr 50 × $160). Turbo tax 1040nr Exceptions to the 50% Limit Generally, business-related meal and entertainment expenses are subject to the 50% limit. Turbo tax 1040nr Figure 26-A can help you determine if the 50% limit applies to you. Turbo tax 1040nr Your meal or entertainment expense is not subject to the 50% limit if the expense meets one of the following exceptions. Turbo tax 1040nr Employee's reimbursed expenses. Turbo tax 1040nr   If you are an employee, you are not subject to the 50% limit on expenses for which your employer reimburses you under an accountable plan. Turbo tax 1040nr Accountable plans are discussed later under Reimbursements . Turbo tax 1040nr Individuals subject to “hours of service” limits. Turbo tax 1040nr   You can deduct a higher percentage of your meal expenses while traveling away from your tax home if the meals take place during or incident to any period subject to the Department of Transportation's “hours of service” limits. Turbo tax 1040nr The percentage is 80%. Turbo tax 1040nr   Individuals subject to the Department of Transportation's “hours of service” limits include the following persons. Turbo tax 1040nr Certain air transportation workers (such as pilots, crew, dispatchers, mechanics, and control tower operators) who are under Federal Aviation Administration regulations. Turbo tax 1040nr Interstate truck operators and bus drivers who are under Department of Transportation regulations. Turbo tax 1040nr Certain railroad employees (such as engineers, conductors, train crews, dispatchers, and control operations personnel) who are under Federal Railroad Administration regulations. Turbo tax 1040nr Certain merchant mariners who are under Coast Guard regulations. Turbo tax 1040nr Other exceptions. Turbo tax 1040nr   There are also exceptions for the self-employed, advertising expenses, selling meals or entertainment, and charitable sports events. Turbo tax 1040nr These are discussed in Publication 463. Turbo tax 1040nr Figure 26-A. Turbo tax 1040nr Does the 50% Limit Apply to Your Expenses? There are exceptions to these rules. Turbo tax 1040nr See Exceptions to the 50% Limit . Turbo tax 1040nr Please click here for the text description of the image. Turbo tax 1040nr Entertainment expenses: 50% limit What Entertainment Expenses Are Deductible? This section explains different types of entertainment expenses you may be able to deduct. Turbo tax 1040nr Entertainment. Turbo tax 1040nr    Entertainment includes any activity generally considered to provide entertainment, amusement, or recreation. Turbo tax 1040nr Examples include entertaining guests at nightclubs; at social, athletic, and sporting clubs; at theaters; at sporting events; or on hunting, fishing, vacation, and similar trips. Turbo tax 1040nr A meal as a form of entertainment. Turbo tax 1040nr   Entertainment includes the cost of a meal you provide to a customer or client, whether the meal is a part of other entertainment or by itself. Turbo tax 1040nr A meal expense includes the cost of food, beverages, taxes, and tips for the meal. Turbo tax 1040nr To deduct an entertainment-related meal, you or your employee must be present when the food or beverages are provided. Turbo tax 1040nr You cannot claim the cost of your meal both as an entertainment expense and as a travel expense. Turbo tax 1040nr Separating costs. Turbo tax 1040nr   If you have one expense that includes the costs of entertainment and other services (such as lodging or transportation), you must allocate that expense between the cost of entertainment and the cost of other services. Turbo tax 1040nr You must have a reasonable basis for making this allocation. Turbo tax 1040nr For example, you must allocate your expenses if a hotel includes entertainment in its lounge on the same bill with your room charge. Turbo tax 1040nr Taking turns paying for meals or entertainment. Turbo tax 1040nr   If a group of business acquaintances take turns picking up each others' meal or entertainment checks without regard to whether any business purposes are served, no member of the group can deduct any part of the expense. Turbo tax 1040nr Lavish or extravagant expenses. Turbo tax 1040nr   You cannot deduct expenses for entertainment that are lavish or extravagant. Turbo tax 1040nr An expense is not considered lavish or extravagant if it is reasonable considering the facts and circumstances. Turbo tax 1040nr Expenses will not be disallowed just because they are more than a fixed dollar amount or take place at deluxe restaurants, hotels, nightclubs, or resorts. Turbo tax 1040nr Trade association meetings. Turbo tax 1040nr    You can deduct entertainment expenses that are directly related to, and necessary for, attending business meetings or conventions of certain exempt organizations if the expenses of your attendance are related to your active trade or business. Turbo tax 1040nr These organizations include business leagues, chambers of commerce, real estate boards, trade associations, and professional associations. Turbo tax 1040nr Entertainment tickets. Turbo tax 1040nr   Generally, you cannot deduct more than the face value of an entertainment ticket, even if you paid a higher price. Turbo tax 1040nr For example, you cannot deduct service fees you pay to ticket agencies or brokers or any amount over the face value of the tickets you pay to scalpers. Turbo tax 1040nr What Entertainment Expenses Are Not Deductible? This section explains different types of entertainment expenses you generally may not be able to deduct. Turbo tax 1040nr Club dues and membership fees. Turbo tax 1040nr   You cannot deduct dues (including initiation fees) for membership in any club organized for: Business, Pleasure, Recreation, or Other social purpose. Turbo tax 1040nr This rule applies to any membership organization if one of its principal purposes is either: To conduct entertainment activities for members or their guests, or To provide members or their guests with access to entertainment facilities. Turbo tax 1040nr   The purposes and activities of a club, not its name, will determine whether or not you can deduct the dues. Turbo tax 1040nr You cannot deduct dues paid to: Country clubs, Golf and athletic clubs, Airline clubs, Hotel clubs, and Clubs operated to provide meals under circumstances generally considered to be conducive to business discussions. Turbo tax 1040nr Entertainment facilities. Turbo tax 1040nr   Generally, you cannot deduct any expense for the use of an entertainment facility. Turbo tax 1040nr This includes expenses for depreciation and operating costs such as rent, utilities, maintenance, and protection. Turbo tax 1040nr   An entertainment facility is any property you own, rent, or use for entertainment. Turbo tax 1040nr Examples include a yacht, hunting lodge, fishing camp, swimming pool, tennis court, bowling alley, car, airplane, apartment, hotel suite, or home in a vacation resort. Turbo tax 1040nr Out-of-pocket expenses. Turbo tax 1040nr   You can deduct out-of-pocket expenses, such as for food and beverages, catering, gas, and fishing bait, that you provided during entertainment at a facility. Turbo tax 1040nr These are not expenses for the use of an entertainment facility. Turbo tax 1040nr However, these expenses are subject to the directly-related and associated tests and to the 50% Limit discussed earlier. Turbo tax 1040nr Additional information. Turbo tax 1040nr   For more information on entertainment expenses, including discussions of the directly-related and associated tests, see chapter 2 of Publication 463. Turbo tax 1040nr Gift Expenses If you give gifts in the course of your trade or business, you can deduct all or part of the cost. Turbo tax 1040nr This section explains the limits and rules for deducting the costs of gifts. Turbo tax 1040nr $25 limit. Turbo tax 1040nr   You can deduct no more than $25 for business gifts you give directly or indirectly to each person during your tax year. Turbo tax 1040nr A gift to a company that is intended for the eventual personal use or benefit of a particular person or a limited class of people will be considered an indirect gift to that particular person or to the individuals within that class of people who receive the gift. Turbo tax 1040nr   If you give a gift to a member of a customer's family, the gift is generally considered to be an indirect gift to the customer. Turbo tax 1040nr This rule does not apply if you have a bona fide, independent business connection with that family member and the gift is not intended for the customer's eventual use or benefit. Turbo tax 1040nr   If you and your spouse both give gifts, both of you are treated as one taxpayer. Turbo tax 1040nr It does not matter whether you have separate businesses, are separately employed, or whether each of you has an independent connection with the recipient. Turbo tax 1040nr If a partnership gives gifts, the partnership and the partners are treated as one taxpayer. Turbo tax 1040nr Incidental costs. Turbo tax 1040nr   Incidental costs, such as engraving on jewelry, or packaging, insuring, and mailing, are generally not included in determining the cost of a gift for purposes of the $25 limit. Turbo tax 1040nr   A cost is incidental only if it does not add substantial value to the gift. Turbo tax 1040nr For example, the cost of customary gift wrapping is an incidental cost. Turbo tax 1040nr However, the purchase of an ornamental basket for packaging fruit is not an incidental cost if the value of the basket is substantial compared to the value of the fruit. Turbo tax 1040nr Exceptions. Turbo tax 1040nr   The following items are not considered gifts for purposes of the $25 limit. Turbo tax 1040nr An item that costs $4 or less and: Has your name clearly and permanently imprinted on the gift, and Is one of a number of identical items you widely distribute. Turbo tax 1040nr Examples include pens, desk sets, and plastic bags and cases. Turbo tax 1040nr Signs, display racks, or other promotional material to be used on the business premises of the recipient. Turbo tax 1040nr Gift or entertainment. Turbo tax 1040nr   Any item that might be considered either a gift or entertainment generally will be considered entertainment. Turbo tax 1040nr However, if you give a customer packaged food or beverages you intend the customer to use at a later date, treat it as a gift. Turbo tax 1040nr    If you give a customer tickets to a theater performance or sporting event and you do not go with the customer to the performance or event, you have a choice. Turbo tax 1040nr You can treat the cost of the tickets as either a gift expense or an entertainment expense, whichever is to your advantage. Turbo tax 1040nr    If you go with the customer to the event, you must treat the cost of the tickets as an entertainment expense. Turbo tax 1040nr You cannot choose, in this case, to treat the cost of the tickets as a gift expense. Turbo tax 1040nr Transportation Expenses This section discusses expenses you can deduct for business transportation when you are not traveling away from home as defined earlier under Travel Expenses . Turbo tax 1040nr These expenses include the cost of transportation by air, rail, bus, taxi, etc. Turbo tax 1040nr , and the cost of driving and maintaining your car. Turbo tax 1040nr Transportation expenses include the ordinary and necessary costs of all of the following. Turbo tax 1040nr Getting from one workplace to another in the course of your business or profession when you are traveling within the area of your tax home. Turbo tax 1040nr (Tax home is defined earlier under Travel Expenses . Turbo tax 1040nr ) Visiting clients or customers. Turbo tax 1040nr Going to a business meeting away from your regular workplace. Turbo tax 1040nr Getting from your home to a temporary workplace when you have one or more regular places of work. Turbo tax 1040nr These temporary workplaces can be either within the area of your tax home or outside that area. Turbo tax 1040nr Transportation expenses do not include expenses you have while traveling away from home overnight. Turbo tax 1040nr Those expenses are travel expenses, discussed earlier. Turbo tax 1040nr However, if you use your car while traveling away from home overnight, use the rules in this section to figure your car expense deduction. Turbo tax 1040nr See Car Expenses , later. Turbo tax 1040nr Illustration of transportation expenses. Turbo tax 1040nr    Figure 26-B illustrates the rules for when you can deduct transportation expenses when you have a regular or main job away from your home. Turbo tax 1040nr You may want to refer to it when deciding whether you can deduct your transportation expenses. Turbo tax 1040nr Daily transportation expenses you incur while traveling from home to one or more regular places of business are generally nondeductible commuting expenses. Turbo tax 1040nr However, there are many exceptions for deducting transportation expenses, like whether your work location is temporary (inside or outside the metropolitan area), traveling for same trade or business, or if you have a home office. Turbo tax 1040nr Temporary work location. Turbo tax 1040nr   If you have one or more regular work locations away from your home and you commute to a temporary work location in the same trade or business, you can deduct the expenses of the daily round-trip transportation between your home and the temporary location, regardless of distance. Turbo tax 1040nr   If your employment at a work location is realistically expected to last (and does in fact last) for 1 year or less, the employment is temporary unless there are facts and circumstances that would indicate otherwise. Turbo tax 1040nr   If your employment at a work location is realistically expected to last for more than 1 year or if there is no realistic expectation that the employment will last for 1 year or less, the employment is not temporary, regardless of whether it actually lasts for more than 1 year. Turbo tax 1040nr   If employment at a work location initially is realistically expected to last for 1 year or less, but at some later date the employment is realistically expected to last more than 1 year, that employment will be treated as temporary (unless there are facts and circumstances that would indicate otherwise) until your expectation changes. Turbo tax 1040nr It will not be treated as temporary after the date you determine it will last more than 1 year. Turbo tax 1040nr   If the temporary work location is beyond the general area of your regular place of work and you stay overnight, you are traveling away from home. Turbo tax 1040nr You may have deductible travel expenses as discussed earlier in this chapter. Turbo tax 1040nr No regular place of work. Turbo tax 1040nr   If you have no regular place of work but ordinarily work in the metropolitan area where you live, you can deduct daily transportation costs between home and a temporary work site outside that metropolitan area. Turbo tax 1040nr   Generally, a metropolitan area includes the area within the city limits and the suburbs that are considered part of that metropolitan area. Turbo tax 1040nr   You cannot deduct daily transportation costs between your home and temporary work sites within your metropolitan area. Turbo tax 1040nr These are nondeductible commuting expenses. Turbo tax 1040nr Two places of work. Turbo tax 1040nr   If you work at two places in one day, whether or not for the same employer, you can deduct the expense of getting from one workplace to the other. Turbo tax 1040nr However, if for some personal reason you do not go directly from one location to the other, you cannot deduct more than the amount it would have cost you to go directly from the first location to the second. Turbo tax 1040nr   Transportation expenses you have in going between home and a part-time job on a day off from your main job are commuting expenses. Turbo tax 1040nr You cannot deduct them. Turbo tax 1040nr Armed Forces reservists. Turbo tax 1040nr   A meeting of an Armed Forces reserve unit is a second place of business if the meeting is held on a day on which you work at your regular job. Turbo tax 1040nr You can deduct the expense of getting from one workplace to the other as just discussed under Two places of work , earlier. Turbo tax 1040nr   You usually cannot deduct the expense if the reserve meeting is held on a day on which you do not work at your regular job. Turbo tax 1040nr In this case, your transportation generally is a nondeductible commuting expense. Turbo tax 1040nr However, you can deduct your transportation expenses if the location of the meeting is temporary and you have one or more regular places of work. Turbo tax 1040nr   If you ordinarily work in a particular metropolitan area but not at any specific location and the reserve meeting is held at a temporary location outside that metropolitan area, you can deduct your transportation expenses. Turbo tax 1040nr   If you travel away from home overnight to attend a guard or reserve meeting, you can deduct your travel expenses. Turbo tax 1040nr These expenses are discussed earlier under Travel Expenses . Turbo tax 1040nr   If you travel more than 100 miles away from home in connection with your performance of services as a member of the reserves, you may be able to deduct some of your reserve-related travel costs as an adjustment to income rather than as an itemized deduction. Turbo tax 1040nr See Armed Forces reservists traveling more than 100 miles from home under Special Rules, later. Turbo tax 1040nr Commuting expenses. Turbo tax 1040nr   You cannot deduct the costs of taking a bus, trolley, subway, or taxi, or of driving a car between your home and your main or regular place of work. Turbo tax 1040nr These costs are personal commuting expenses. Turbo tax 1040nr You cannot deduct commuting expenses no matter how far your home is from your regular place of work. Turbo tax 1040nr You cannot deduct commuting expenses even if you work during the commuting trip. Turbo tax 1040nr Example. Turbo tax 1040nr You sometimes use your cell phone to make business calls while commuting to and from work. Turbo tax 1040nr Sometimes business associates ride with you to and from work, and you have a business discussion in the car. Turbo tax 1040nr These activities do not change the trip from personal to business. Turbo tax 1040nr You cannot deduct your commuting expenses. Turbo tax 1040nr Parking fees. Turbo tax 1040nr   Fees you pay to park your car at your place of business are nondeductible commuting expenses. Turbo tax 1040nr You can, however, deduct business-related parking fees when visiting a customer or client. Turbo tax 1040nr Advertising display on car. Turbo tax 1040nr   Putting display material that advertises your business on your car does not change the use of your car from personal use to business use. Turbo tax 1040nr If you use this car for commuting or other personal uses, you still cannot deduct your expenses for those uses. Turbo tax 1040nr Car pools. Turbo tax 1040nr   You cannot deduct the cost of using your car in a nonprofit car pool. Turbo tax 1040nr Do not include payments you receive from the passengers in your income. Turbo tax 1040nr These payments are considered reimbursements of your expenses. Turbo tax 1040nr However, if you operate a car pool for a profit, you must include payments from passengers in your income. Turbo tax 1040nr You can then deduct your car expenses (using the rules in this chapter). Turbo tax 1040nr Hauling tools or instruments. Turbo tax 1040nr   Hauling tools or instruments in your car while commuting to and from work does not make your car expenses deductible. Turbo tax 1040nr However, you can deduct any additional costs you have for hauling tools or instruments (such as for renting a trailer you tow with your car). Turbo tax 1040nr Union members' trips from a union hall. Turbo tax 1040nr   If you get your work assignments at a union hall and then go to your place of work, the costs of getting from the union hall to your place of work are nondeductible commuting expenses. Turbo tax 1040nr Although you need the union to get your work assignments, you are employed where you work, not where the union hall is located. Turbo tax 1040nr Office in the home. Turbo tax 1040nr   If you have an office in your home that qualifies as a principal place of business, you can deduct your daily transportation costs between your home and another work location in the same trade or business. Turbo tax 1040nr (See chapter 28 for information on determining if your home office qualifies as a principal place of business. Turbo tax 1040nr ) Figure 26-B. Turbo tax 1040nr When Are Transportation Expenses Deductible? Most employees and self-employed persons can use this chart. Turbo tax 1040nr (Do not use this chart if your home is your principal place of business. Turbo tax 1040nr See Office in the home . Turbo tax 1040nr ) Please click here for the text description of the image. Turbo tax 1040nr Figure 26-B. Turbo tax 1040nr Local Transportation Examples of deductible transportation. Turbo tax 1040nr   The following examples show when you can deduct transportation expenses based on the location of your work and your home. Turbo tax 1040nr Example 1. Turbo tax 1040nr You regularly work in an office in the city where you live. Turbo tax 1040nr Your employer sends you to a 1-week training session at a different office in the same city. Turbo tax 1040nr You travel directly from your home to the training location and return each day. Turbo tax 1040nr You can deduct the cost of your daily round-trip transportation between your home and the training location. Turbo tax 1040nr Example 2. Turbo tax 1040nr Your principal place of business is in your home. Turbo tax 1040nr You can deduct the cost of round-trip transportation between your qualifying home office and your client's or customer's place of business. Turbo tax 1040nr Example 3. Turbo tax 1040nr You have no regular office, and you do not have an office in your home. Turbo tax 1040nr In this case, the location of your first business contact inside the metropolitan area is considered your office. Turbo tax 1040nr Transportation expenses between your home and this first contact are nondeductible commuting expenses. Turbo tax 1040nr Transportation expenses between your last business contact and your home are also nondeductible commuting expenses. Turbo tax 1040nr While you cannot deduct the costs of these first and last trips, you can deduct the costs of going from one client or customer to another. Turbo tax 1040nr With no regular or home office, the costs of travel between two or more business contacts in a metropolitan area are deductible while the costs of travel between the home to (and from) business contacts are not deductible. Turbo tax 1040nr Car Expenses If you use your car for business purposes, you may be able to deduct car expenses. Turbo tax 1040nr You generally can use one of the two following methods to figure your deductible expenses. Turbo tax 1040nr Standard mileage rate. Turbo tax 1040nr Actual car expenses. Turbo tax 1040nr If you use actual car expenses to figure your deduction for a car you lease, there are rules that affect the amount of your lease payments you can deduct. Turbo tax 1040nr See Leasing a car under Actual Car Expenses, later. Turbo tax 1040nr In this chapter, “car” includes a van, pickup, or panel truck. Turbo tax 1040nr Rural mail carriers. Turbo tax 1040nr   If you are a rural mail carrier, you may be able to treat the amount of qualified reimbursement you received as the amount of your allowable expense. Turbo tax 1040nr Because the qualified reimbursement is treated as paid under an accountable plan, your employer should not include the amount of reimbursement in your income. Turbo tax 1040nr   If your vehicle expenses are more than the amount of your reimbursement, you can deduct the unreimbursed expenses as an itemized deduction on Schedule A (Form 1040). Turbo tax 1040nr You must complete Form 2106 and attach it to your Form 1040. Turbo tax 1040nr   A “qualified reimbursement” is the reimbursement you receive that meets both of the following conditions. Turbo tax 1040nr It is given as an equipment maintenance allowance (EMA) to employees of the U. Turbo tax 1040nr S. Turbo tax 1040nr Postal Service. Turbo tax 1040nr It is at the rate contained in the 1991 collective bargaining agreement. Turbo tax 1040nr Any later agreement cannot increase the qualified reimbursement amount by more than the rate of inflation. Turbo tax 1040nr See your employer for information on your reimbursement. Turbo tax 1040nr If you are a rural mail carrier and received a qualified reimbursement, you cannot use the standard mileage rate. Turbo tax 1040nr Standard Mileage Rate You may be able to use the standard mileage rate to figure the deductible costs of operating your car for business purposes. Turbo tax 1040nr For 2013, the standard mileage rate for business use is 56½ cents per mile. Turbo tax 1040nr If you use the standard mileage rate for a year, you cannot deduct your actual car expenses for that year, but see Parking fees and tolls, later. Turbo tax 1040nr You generally can use the standard mileage rate whether or not you are reimbursed and whether or not any reimbursement is more or less than the amount figured using the standard mileage rate. Turbo tax 1040nr See Reimbursements under How To Report, later. Turbo tax 1040nr Choosing the standard mileage rate. Turbo tax 1040nr   If you want to use the standard mileage rate for a car you own, you must choose to use it in the first year the car is available for use in your business. Turbo tax 1040nr Then in later years, you can choose to use either the standard mileage rate or actual expenses. Turbo tax 1040nr   If you want to use the standard mileage rate for a car you lease, you must use it for the entire lease period. Turbo tax 1040nr   You must make the choice to use the standard mileage rate by the due date (including extensions) of your return. Turbo tax 1040nr You cannot revoke the choice. Turbo tax 1040nr However, in a later year, you can switch from the standard mileage rate to the actual expenses method. Turbo tax 1040nr If you change to the actual expenses method in a later year, but before your car is fully depreciated, you have to estimate the remaining useful life of the car and use straight line depreciation. Turbo tax 1040nr Example. Turbo tax 1040nr Larry is an employee who occasionally uses his own car for business purposes. Turbo tax 1040nr He purchased the car in 2011, but he did not claim any unreimburse
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SOI Tax Stats - Individual Tax Statistics

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Here you will find links to various studies relating to the individual taxpayer.

 

Individual Income Tax Numerous studies which provide statistics on income, deductions, tax, and credits reported on individual Form 1040 income tax returns and associated schedules are available in this area. Find statistics on high income tax returns, income tax rates, nonfarm sole proprietorships, data by geographic areas, and more...

Estate Tax

Estate Tax Statistics OneSheet

This annual study includes information on gross estate and its composition, deductions, and tax; and information on the age, sex, and marital status of decedents. Basic estate tax return data by year in which returns are filed are produced each year. Also included are data on nonresident aliens who had more than $60,000 of assets in the United States. These data come from taxpayers filing Form 706.
International Numerous studies which provide statistics on the individual taxpayer in the international context. Find statistics on foreign recipients of U.S. income, foreign trusts, individual foreign earned income and the foreign tax credit, international boycotts and nonresident alien estate tax returns. These data come from taxpayers filing Forms 706-NA, 1042-S, 1116, 2555, 3520, 5713 and more.
Personal Wealth This periodic study provides estimates of personal wealth of top wealth holders that are generated from estate tax return data using the "estate multiplier" technique, in conjunction with both filing-year and year-of-death estate databases.

Income from Trusts and Estates

Snapshot of Estate and Trust Income Tax Statistics

The U.S. Income Tax Return for Estates and Trusts (Form 1041) is used to report the income, deductions, gains, and losses of estates and trusts, as well as distributions to beneficiaries and income tax liability. Entities are classified into types based on their purpose.  

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Page Last Reviewed or Updated: 24-Mar-2014

The Turbo Tax 1040nr

Turbo tax 1040nr Part Three -   Gains and Losses The four chapters in this part discuss investment gains and losses, including how to figure your basis in property. Turbo tax 1040nr A gain from selling or trading stocks, bonds, or other investment property may be taxed or it may be tax free, at least in part. Turbo tax 1040nr A loss may or may not be deductible. Turbo tax 1040nr These chapters also discuss gains from selling property you personally use — including the special rules for selling your home. Turbo tax 1040nr Nonbusiness casualty and theft losses are discussed in chapter 25 in Part Five. Turbo tax 1040nr Table of Contents 13. Turbo tax 1040nr   Basis of PropertyIntroduction Useful Items - You may want to see: Cost BasisReal Property Adjusted BasisIncreases to Basis Decreases to Basis Basis Other Than CostProperty Received for Services Taxable Exchanges Involuntary Conversions Nontaxable Exchanges Property Transferred From a Spouse Property Received as a Gift Inherited Property Property Changed From Personal to Business or Rental Use Stocks and Bonds 14. Turbo tax 1040nr   Sale of PropertyReminder Introduction Useful Items - You may want to see: Sales and TradesWhat Is a Sale or Trade? How To Figure Gain or Loss Nontaxable Trades Transfers Between Spouses Related Party Transactions Capital Gains and LossesCapital or Ordinary Gain or Loss Capital Assets and Noncapital Assets Holding Period Nonbusiness Bad Debts Wash Sales Rollover of Gain From Publicly Traded Securities 15. Turbo tax 1040nr   Selling Your HomeReminder Introduction Useful Items - You may want to see: Main Home Figuring Gain or LossSelling Price Amount Realized Adjusted Basis Amount of Gain or Loss Dispositions Other Than Sales Determining Basis Excluding the GainMaximum Exclusion Ownership and Use Tests Reduced Maximum Exclusion Business Use or Rental of Home Reporting the SaleSeller-financed mortgage. Turbo tax 1040nr More information. Turbo tax 1040nr Special SituationsException for sales to related persons. Turbo tax 1040nr Recapturing (Paying Back) a Federal Mortgage Subsidy 16. Turbo tax 1040nr   Reporting Gains and Losses What's New Introduction Useful Items - You may want to see: Reporting Capital Gains and Losses Exception 1. Turbo tax 1040nr Exception 2. Turbo tax 1040nr File Form 1099-B or Form 1099-S with the IRS. Turbo tax 1040nr Capital Losses Capital Gain Tax Rates Prev  Up  Next   Home   More Online Publications