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1040 Ez 2010 Pdf

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1040 Ez 2010 Pdf

1040 ez 2010 pdf 3. 1040 ez 2010 pdf   Filing Information for Individuals in Certain U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Possessions Table of Contents American SamoaWhere To Get Forms and Information Which Returns To File Special Rules for American Samoa Double Taxation The Commonwealth of Puerto RicoWhere To Get Forms and Information Which Returns To File Special Rules for Puerto Rico Double Taxation The Commonwealth of the Northern Mariana IslandsWhere To Get Forms and Information Which Return To File Special Rules for the CNMI Double Taxation GuamWhere To Get Forms and Information Which Return To File Special Rules for Guam Double Taxation The U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Virgin IslandsWhere To Get Forms and Information Which Return To File Special Rules for the USVI Double Taxation If you have income from American Samoa, the CNMI, Guam, Puerto Rico, or the USVI, you may have to file a tax return with the tax department of that possession. 1040 ez 2010 pdf Or, you may have to file two annual tax returns, one with the possession's tax department and the other with the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Internal Revenue Service. 1040 ez 2010 pdf This chapter covers the general rules for filing returns in the five possessions. 1040 ez 2010 pdf You must first determine if you are a bona fide resident of the relevant possession. 1040 ez 2010 pdf See chapter 1 for a discussion of the requirements you must meet. 1040 ez 2010 pdf You should ask for forms and advice about the filing of possession tax returns from that possession's tax department, not the Internal Revenue Service. 1040 ez 2010 pdf Contact information is listed in this chapter under the heading for each possession. 1040 ez 2010 pdf American Samoa American Samoa has its own separate and independent tax system. 1040 ez 2010 pdf Although its tax laws are modeled on the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Internal Revenue Code, there are certain differences. 1040 ez 2010 pdf Where To Get Forms and Information Requests for advice about matters connected with Samoan taxation should be sent to: American Samoa Government Tax Office  Executive Office Building First Floor Pago Pago, AS 96799 The phone number is (684) 633-4181. 1040 ez 2010 pdf The fax number is (684) 633-1513. 1040 ez 2010 pdf You can get forms and publications at www. 1040 ez 2010 pdf americansamoa. 1040 ez 2010 pdf gov. 1040 ez 2010 pdf The addresses and phone numbers listed above are subject to change. 1040 ez 2010 pdf Which Returns To File Your residency status and your source of income with regard to American Samoa determine whether you file your return and pay your tax to American Samoa, to the United States, or to both. 1040 ez 2010 pdf In addition to the information below that is categorized by residency status, the Special Rules for American Samoa section (later) contains important information for determining the correct forms to file. 1040 ez 2010 pdf Bona Fide Resident of American Samoa Bona fide residents of American Samoa are generally exempt from U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax on their American Samoa source income. 1040 ez 2010 pdf U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf citizen or resident alien. 1040 ez 2010 pdf   If you are a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf citizen or resident alien and a bona fide resident of American Samoa during the entire tax year, you generally must file the following returns. 1040 ez 2010 pdf An American Samoa tax return reporting your gross income from worldwide sources. 1040 ez 2010 pdf If you report non-American Samoa source income on your American Samoa tax return, you can claim a credit against your American Samoa tax liability for income taxes paid on that income to the United States, a foreign country, or another possession. 1040 ez 2010 pdf A U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return reporting income from worldwide sources, but excluding income from sources within American Samoa. 1040 ez 2010 pdf However, amounts received for services performed as an employee of the United States or any of its agencies cannot be excluded (see U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Government employees under Special Rules for American Samoa, later). 1040 ez 2010 pdf To exclude American Samoa source income, attach a completed Form 4563 to your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return (see Form 4563 for more information). 1040 ez 2010 pdf If you are excluding American Samoa source income on your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return, you will not be allowed any deductions from gross income or credits against tax that are directly or indirectly allocable to the exempt income. 1040 ez 2010 pdf For more information, see Special Rules for Completing Your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Tax Return in chapter 4. 1040 ez 2010 pdf Nonresident alien. 1040 ez 2010 pdf   If you are a bona fide resident of American Samoa during the entire tax year, but a nonresident alien of the United States, you generally must file the following returns. 1040 ez 2010 pdf An American Samoa tax return reporting worldwide income. 1040 ez 2010 pdf A U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return (Form 1040, U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Individual Income Tax Return) reporting income from worldwide sources, but excluding American Samoa source income other than amounts for services performed as an employee of the United States or any of its agencies. 1040 ez 2010 pdf For more information, see U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Government employees under Special Rules for American Samoa, later. 1040 ez 2010 pdf To exclude income from sources within American Samoa, attach a completed Form 4563 to your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return (see Form 4563 , below, for more information). 1040 ez 2010 pdf For all other tax purposes, however, you will be treated as a nonresident alien individual. 1040 ez 2010 pdf For example, you are not allowed the standard deduction, you cannot file a joint return, and you are not allowed a deduction for a dependent unless that person is a citizen or national of the United States. 1040 ez 2010 pdf There are also limitations on what deductions and credits are allowed. 1040 ez 2010 pdf See Publication 519 for more information. 1040 ez 2010 pdf Form 4563. 1040 ez 2010 pdf   If you must file a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf income tax return and you qualify to exclude any of your income from American Samoa, claim the exclusion by completing Form 4563 and attaching it to your Form 1040. 1040 ez 2010 pdf Form 4563 cannot be filed by itself. 1040 ez 2010 pdf There is an example of a filled-in Form 4563 in chapter 5. 1040 ez 2010 pdf   If you are a bona fide resident of American Samoa during the entire tax year and you are not including a check or a money order, send your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return and all attachments (including Form 4563) to: Department of the Treasury Internal Revenue Service Austin, TX 73301-0215 USA   If you are including a check or a money order, send your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return and all attachments (including Form 4563) to: Internal Revenue Service P. 1040 ez 2010 pdf O. 1040 ez 2010 pdf Box 1303 Charlotte, NC 28201-1303 USA   Send your American Samoa tax return and all attachments to the address given under Where To Get Forms and Information , earlier. 1040 ez 2010 pdf Self-employment tax. 1040 ez 2010 pdf   If you are not required to file a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return but have income that is effectively connected with a trade or business in American Samoa, you must file Form 1040-SS with the United States. 1040 ez 2010 pdf On this form you will report your self-employment income to the United States and, if necessary, pay self-employment tax on that income. 1040 ez 2010 pdf Additional Medicare Tax. 1040 ez 2010 pdf   Beginning in 2013, you may be required to pay Additional Medicare Tax. 1040 ez 2010 pdf Also, you may need to report Additional Medicare Tax withheld by your employer. 1040 ez 2010 pdf For more information see Additional Medicare Tax under Special Rules for Completing Your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Tax Return in chapter 4. 1040 ez 2010 pdf Net Investment Income Tax. 1040 ez 2010 pdf   Beginning in 2013, the Net Investment Income Tax (NIIT) is 3. 1040 ez 2010 pdf 8 percent of the lesser of an individual’s net investment income or the excess of the individual’s modified adjusted gross income over a specified threshold amount. 1040 ez 2010 pdf The NIIT will apply to a bona fide resident of American Samoa if a taxpayer has modified adjusted gross income from sources outside of American Samoa that exceeds a specified threshold amount, e. 1040 ez 2010 pdf g. 1040 ez 2010 pdf , $200,000 for single filers. 1040 ez 2010 pdf The NIIT does not apply to any individual who is a nonresident alien with respect to the United States. 1040 ez 2010 pdf See Form 8960, Net Investment Income Tax—Individuals, Estates, and Trusts, and its instructions for more information on the NIIT. 1040 ez 2010 pdf Estimated tax payments. 1040 ez 2010 pdf   To see if you are required to make payments of estimated income tax, self-employment tax, Additional Medicare Tax, and/or Net Investment Income Tax to the IRS, get Form 1040-ES, Estimated Tax for Individuals. 1040 ez 2010 pdf   To pay by check or money order, send your payment with the Form 1040-ES payment voucher to: Internal Revenue Service P. 1040 ez 2010 pdf O. 1040 ez 2010 pdf Box 1300 Charlotte, NC 28201-1300 USA   To get information on paying electronically (by credit or debit card, or through the Electronic Federal Tax Payment System (EFTPS)), go to www. 1040 ez 2010 pdf irs. 1040 ez 2010 pdf gov/e-pay. 1040 ez 2010 pdf   For information on making estimated income tax payments to American Samoa, see Where To Get Forms and Information , earlier. 1040 ez 2010 pdf Not a Bona Fide Resident of American Samoa An individual who is not a bona fide resident of American Samoa for the tax year generally files both U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf and American Samoa tax returns, and claims a foreign tax credit on the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf return for taxes paid to American Samoa. 1040 ez 2010 pdf U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf citizen or resident alien. 1040 ez 2010 pdf   If you are a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf citizen or resident alien but not a bona fide resident of American Samoa during the entire tax year, you generally must file the following returns. 1040 ez 2010 pdf An American Samoa tax return reporting only your income from sources within American Samoa. 1040 ez 2010 pdf Wages for services performed in American Samoa, whether for a private employer, the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Government, or otherwise, is income from sources within American Samoa. 1040 ez 2010 pdf A U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return reporting your income from worldwide sources. 1040 ez 2010 pdf You can take a credit against your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax liability if you paid income taxes to American Samoa (or other possession or foreign country) and reported income from those sources on your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return. 1040 ez 2010 pdf De minimis exception to determining source of income. 1040 ez 2010 pdf   In certain situations you will not have income from a possession. 1040 ez 2010 pdf See De minimis exception under Compensation for Labor or Personal Services in chapter 2. 1040 ez 2010 pdf Nonresident alien. 1040 ez 2010 pdf   If you are a nonresident alien of the United States who does not qualify as a bona fide resident of American Samoa for the entire tax year, you generally must file the following returns. 1040 ez 2010 pdf An American Samoa tax return reporting only your income from sources within American Samoa. 1040 ez 2010 pdf In this situation, wages for services performed in American Samoa, whether for a private employer, the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Government, or otherwise, is income from sources within American Samoa. 1040 ez 2010 pdf A U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return (Form 1040NR, U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Nonresident Alien Income Tax Return) reporting U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf source income according to the rules for a nonresident alien. 1040 ez 2010 pdf See the Instructions for Form 1040NR. 1040 ez 2010 pdf   If you are not a bona fide resident of American Samoa during the entire tax year, and you are not including a check or a money order, send your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return and all attachments to: Department of the Treasury Internal Revenue Service Austin, TX 73301-0215 USA   If you are including a check or a money order, send your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return and all attachments to: Internal Revenue Service P. 1040 ez 2010 pdf O. 1040 ez 2010 pdf Box 1303 Charlotte, NC 28201-1303 USA   Send your American Samoa tax return and all attachments to the address given under Where To Get Forms and Information , earlier. 1040 ez 2010 pdf Special Rules for American Samoa Some special rules apply to certain types of income and employment connected with American Samoa. 1040 ez 2010 pdf U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Armed Forces. 1040 ez 2010 pdf   Bona fide residents of American Samoa include military personnel whose official home of record is American Samoa. 1040 ez 2010 pdf Civilian spouse of active duty member of the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Armed Forces. 1040 ez 2010 pdf   If, under the rule discussed at the beginning of chapter 1 (see Special rule for civilian spouse of active duty member of the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Armed Forces ), your tax residence is American Samoa, follow the guidance in the section for bona fide residents under Which Returns To File, earlier. 1040 ez 2010 pdf However, if your tax residence is one of the 50 states or the District of Columbia and your only income from American Samoa is from wages, salaries, tips, or self-employment, you will be taxed on your worldwide income and file only a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return (Form 1040) and a state and/or local tax return, if required. 1040 ez 2010 pdf If you have income from American Samoa other than wages, salaries, tips, or self-employment that is considered to be sourced in that possession (see Table 2-1), contact the local tax administration for guidance. 1040 ez 2010 pdf U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Government employees. 1040 ez 2010 pdf   If you are employed in American Samoa by the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Government or any of its agencies, you are subject to tax by American Samoa on your pay from the government. 1040 ez 2010 pdf Whether you are subject to tax by American Samoa on your non-American Samoa source income depends on your status in American Samoa as a bona fide resident. 1040 ez 2010 pdf   Wages and salaries paid to employees of the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Government and its agencies are also subject to U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf federal income tax. 1040 ez 2010 pdf These payments do not qualify for the exclusion of income from sources within American Samoa, discussed earlier. 1040 ez 2010 pdf   For tax years ending after April 9, 2008, wages and salaries paid to bona fide residents by the Government of American Samoa can be excluded on the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return. 1040 ez 2010 pdf   If you report government wages on both your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf and American Samoa tax returns, you can take a credit on your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return for income taxes paid or accrued to American Samoa. 1040 ez 2010 pdf Figure the credit on Form 1116, and attach that form to your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return, Form 1040. 1040 ez 2010 pdf Show your wages paid for services performed in American Samoa on Form 1116, line 1a, enter “American Samoa” on line g, and check box b above Part I. 1040 ez 2010 pdf Moving expense deduction. 1040 ez 2010 pdf   Generally, expenses of a move to American Samoa are directly attributable to American Samoa wages, salaries, and other earned income. 1040 ez 2010 pdf Likewise, the expenses of a move back to the United States are generally attributable to U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf earned income. 1040 ez 2010 pdf   If your move was to American Samoa, report your deduction for moving expenses as follows. 1040 ez 2010 pdf If you are a bona fide resident in the tax year of your move, enter your deductible expenses on your American Samoa tax return. 1040 ez 2010 pdf If you are not a bona fide resident, enter your deductible expenses on both your American Samoa and U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax returns. 1040 ez 2010 pdf Also, for purposes of a tax credit against your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax liability, reduce your American Samoa “general category income” on Form 1116, line 1a, by entering the deductible moving expenses on line 2. 1040 ez 2010 pdf   If your move was to the United States, complete Form 3903, Moving Expenses, and enter the deductible amount on Form 1040, line 26. 1040 ez 2010 pdf Double Taxation A mutual agreement procedure exists to settle cases of double taxation between the United States and American Samoa. 1040 ez 2010 pdf See Double Taxation in chapter 4. 1040 ez 2010 pdf The Commonwealth of Puerto Rico The Commonwealth of Puerto Rico has its own separate and independent tax system. 1040 ez 2010 pdf Although it is modeled after the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf system, there are differences in law and tax rates. 1040 ez 2010 pdf Where To Get Forms and Information Requests for information about the filing of Puerto Rico tax returns should be addressed to: Departamento de Hacienda Negociado de Asistencia Contributiva  P. 1040 ez 2010 pdf O. 1040 ez 2010 pdf Box 9024140 San Juan, Puerto Rico 00902-4140 The phone numbers are (787) 721-8051 and (787) 721-7198. 1040 ez 2010 pdf    To obtain Puerto Rico tax forms, contact the Forms and Publications Division Office at the above address or call (787) 722-0216, option #7. 1040 ez 2010 pdf You can access the Hacienda website at www. 1040 ez 2010 pdf hacienda. 1040 ez 2010 pdf gobierno. 1040 ez 2010 pdf pr or email your questions about Puerto Rico taxes to InfoServ@hacienda. 1040 ez 2010 pdf gobierno. 1040 ez 2010 pdf pr. 1040 ez 2010 pdf The addresses and phone numbers listed above are subject to change. 1040 ez 2010 pdf Which Returns To File Generally, you will file returns with both Puerto Rico and the United States. 1040 ez 2010 pdf The income reported on each return depends on your residency status in Puerto Rico. 1040 ez 2010 pdf To determine if you are a bona fide resident of Puerto Rico, see the information in chapter 1. 1040 ez 2010 pdf Bona Fide Resident of Puerto Rico Bona fide residents of Puerto Rico will generally pay tax to Puerto Rico on their worldwide income. 1040 ez 2010 pdf U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf citizen or resident alien. 1040 ez 2010 pdf   If you are a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf citizen or resident alien and also a bona fide resident of Puerto Rico during the entire tax year, you generally must file the following returns. 1040 ez 2010 pdf A Puerto Rico tax return reporting income from worldwide sources. 1040 ez 2010 pdf If you report U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf source income on your Puerto Rico tax return, you can claim a credit against your Puerto Rico tax, up to the amount allowable, for income taxes paid to the United States. 1040 ez 2010 pdf A U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return reporting income from worldwide sources, but excluding Puerto Rico source income. 1040 ez 2010 pdf However, see U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Government employees under Special Rules for Puerto Rico, later, for an exception. 1040 ez 2010 pdf If you are excluding Puerto Rico income on your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return, you will not be allowed any deductions or credits that are directly or indirectly allocable to exempt income. 1040 ez 2010 pdf For more information, see Special Rules for Completing Your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Tax Return in chapter 4. 1040 ez 2010 pdf If all of your income is from Puerto Rico sources, you are not required to file a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return. 1040 ez 2010 pdf However, if you have self-employment income, see Self-employment tax , later. 1040 ez 2010 pdf U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf citizen only. 1040 ez 2010 pdf   If you are a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf citizen, you may also qualify under these rules if you have been a bona fide resident of Puerto Rico for at least 2 years before moving from Puerto Rico. 1040 ez 2010 pdf In this case, you can exclude your income derived from sources within Puerto Rico (but not wages and salaries received as an employee of the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Government or its agencies) that you earned before the date you changed your residence. 1040 ez 2010 pdf For more information, see Puerto Rico under Year of Moving From a Possession in chapter 1. 1040 ez 2010 pdf Nonresident alien. 1040 ez 2010 pdf   If you are a bona fide resident of Puerto Rico during the entire tax year, but a nonresident alien of the United States, you generally must file the following returns. 1040 ez 2010 pdf A Puerto Rico tax return reporting income from worldwide sources. 1040 ez 2010 pdf If you report U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf source income on your Puerto Rico tax return, you can claim a credit against your Puerto Rico tax, up to the amount allowable, for income taxes paid to the United States. 1040 ez 2010 pdf A U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return (Form 1040) reporting income from worldwide sources, but excluding Puerto Rico source income (other than amounts for services performed as an employee of the United States or any of its agencies). 1040 ez 2010 pdf For tax purposes other than reporting income, however, you will be treated as a nonresident alien individual. 1040 ez 2010 pdf For example, you are not allowed the standard deduction, you cannot file a joint return, and you are not allowed a deduction for a dependent unless that person is a citizen or national of the United States. 1040 ez 2010 pdf There are also limitations on what deductions and credits are allowed. 1040 ez 2010 pdf See Publication 519 for more information. 1040 ez 2010 pdf Self-employment tax. 1040 ez 2010 pdf   If you have no U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf filing requirement but have income that is effectively connected with a trade or business in Puerto Rico, you must file Form 1040-SS or Form 1040-PR with the United States to report your self-employment income and, if necessary, pay self-employment tax. 1040 ez 2010 pdf Additional Medicare Tax. 1040 ez 2010 pdf   Beginning in 2013, you may be required to pay Additional Medicare Tax. 1040 ez 2010 pdf Also, you may need to report Additional Medicare Tax withheld by your employer. 1040 ez 2010 pdf For more information see Additional Medicare Tax under Special Rules for Completing Your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Tax Return in chapter 4. 1040 ez 2010 pdf Net Investment Income Tax. 1040 ez 2010 pdf   Beginning in 2013, the Net Investment Income Tax (NIIT) is 3. 1040 ez 2010 pdf 8 percent of the lesser of an individual’s net investment income or the excess of the individual’s modified adjusted gross income over a specified threshold amount. 1040 ez 2010 pdf The NIIT will apply to a bona fide resident of Puerto Rico if a taxpayer has modified adjusted gross income from sources outside of Puerto Rico that exceeds a specified threshold amount, e. 1040 ez 2010 pdf g. 1040 ez 2010 pdf , $200,000 for single filers. 1040 ez 2010 pdf The NIIT does not apply to any individual who is a nonresident alien with respect to the United States. 1040 ez 2010 pdf See Form 8960, Net Investment Income Tax—Individuals, Estates, and Trusts, and its instructions for more information on the NIIT. 1040 ez 2010 pdf Estimated tax payments. 1040 ez 2010 pdf   To see if you are required to make payments of estimated income tax, self-employment tax, Additional Medicare Tax, and/or Net Investment Income Tax to the IRS, get Form 1040-ES (or Form 1040-ES(PR)). 1040 ez 2010 pdf   To pay by check or money order, send your payment with the Form 1040-ES (or Form 1040-ES(PR)) payment voucher to: Internal Revenue Service P. 1040 ez 2010 pdf O. 1040 ez 2010 pdf Box 1300 Charlotte, NC 28201-1300 USA   To get information on paying electronically (by credit or debit card, or through the Electronic Federal Tax Payment System (EFTPS)), go to www. 1040 ez 2010 pdf irs. 1040 ez 2010 pdf gov/e-pay. 1040 ez 2010 pdf   For information on making estimated income tax payments to Hacienda, see Where To Get Forms and Information , earlier. 1040 ez 2010 pdf Not a Bona Fide Resident of Puerto Rico An individual who is not a bona fide resident of Puerto Rico for the tax year generally files tax returns with both Puerto Rico and the United States. 1040 ez 2010 pdf U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf citizen or resident alien. 1040 ez 2010 pdf   If you are a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf citizen or resident alien but not a bona fide resident of Puerto Rico during the entire tax year, you generally must file the following returns. 1040 ez 2010 pdf A Puerto Rico tax return reporting only your income from Puerto Rico sources. 1040 ez 2010 pdf Wages for services performed in Puerto Rico, whether for a private employer, the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Government, or otherwise, is income from Puerto Rico sources. 1040 ez 2010 pdf A U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return reporting income from worldwide sources. 1040 ez 2010 pdf Generally, you can claim a foreign tax credit for income taxes paid to Puerto Rico on the Puerto Rico income that is not exempt from U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf taxes (see chapter 4 for more information). 1040 ez 2010 pdf Nonresident alien. 1040 ez 2010 pdf   If you are a nonresident alien of the United States who does not qualify as a bona fide resident of Puerto Rico for the entire tax year, you generally must file the following returns. 1040 ez 2010 pdf A Puerto Rico tax return reporting only your income from Puerto Rico sources. 1040 ez 2010 pdf Wages for services performed in Puerto Rico, whether for a private employer, the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Government, or otherwise, is income from Puerto Rico sources. 1040 ez 2010 pdf A U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return (Form 1040NR) according to the rules for a nonresident alien. 1040 ez 2010 pdf See the Instructions for Form 1040NR. 1040 ez 2010 pdf De minimis exception to determining source of income. 1040 ez 2010 pdf   In certain situations you will not have income from a possession. 1040 ez 2010 pdf See De minimis exception under Compensation for Labor or Personal Services in chapter 2. 1040 ez 2010 pdf Use the addresses listed below to file your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf and Puerto Rico income tax returns. 1040 ez 2010 pdf If you are not including a check or a money order, send your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return and all attachments to: Department of the Treasury Internal Revenue Service Austin, TX 73301-0215 USA If you are including a check or a money order, send your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return and all attachments to: Internal Revenue Service P. 1040 ez 2010 pdf O. 1040 ez 2010 pdf Box 1303 Charlotte, NC 28201-1303 USA If you request a refund on your Puerto Rico return, send your Puerto Rico tax return and all attachments to: Departamento de Hacienda P. 1040 ez 2010 pdf O. 1040 ez 2010 pdf Box 50072 San Juan, PR 00902-6272 Send all other Puerto Rico tax returns, with all attachments, to: Departamento de Hacienda P. 1040 ez 2010 pdf O. 1040 ez 2010 pdf Box 9022501 San Juan, PR 00902-2501 Special Rules for Puerto Rico In addition to the general rules given earlier for filing U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf and Puerto Rico tax returns, there are some special rules that apply to certain individuals and types of income. 1040 ez 2010 pdf U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Government employees. 1040 ez 2010 pdf   Wages and cost-of-living allowances paid by the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Government (or one of its agencies) for working in Puerto Rico are subject to Puerto Rico tax. 1040 ez 2010 pdf However, the cost-of-living allowances are excluded from Puerto Rico gross income up to the amount exempt from U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax. 1040 ez 2010 pdf In order to claim this exclusion, you must: Include with your Puerto Rico tax return evidence to show the amount received during the year, and Be in full compliance with your Puerto Rico tax responsibilities. 1040 ez 2010 pdf   These wages are also subject to U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax, but the cost-of-living allowances are excludable. 1040 ez 2010 pdf A foreign tax credit is available in order to avoid double taxation. 1040 ez 2010 pdf U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Armed Forces. 1040 ez 2010 pdf   Bona fide residents of Puerto Rico include military personnel whose official home of record is Puerto Rico. 1040 ez 2010 pdf Civilian spouse of active duty member of the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Armed Forces. 1040 ez 2010 pdf   If, under the rule discussed at the beginning of chapter 1 (see Special rule for civilian spouse of active duty member of the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Armed Forces ), your tax residence is Puerto Rico, follow the guidance in the section for bona fide residents under Which Returns To File, earlier. 1040 ez 2010 pdf However, if your tax residence is one of the 50 states or the District of Columbia and your only income from Puerto Rico is from wages, salaries, tips, or self-employment, you will be taxed on your worldwide income and file only a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return (Form 1040) and a state and/or local tax return, if required. 1040 ez 2010 pdf If you have income from Puerto Rico other than wages, salaries, tips, or self-employment that is considered to be sourced in that possession (see Table 2-1 ), contact the Hacienda for guidance. 1040 ez 2010 pdf Income from sources outside Puerto Rico and the United States. 1040 ez 2010 pdf   If you are a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf citizen and bona fide resident of Puerto Rico and you have income from sources outside both Puerto Rico and the United States, that income is treated as foreign source income under both tax systems. 1040 ez 2010 pdf In addition to your Puerto Rico and U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax returns, you may also have to file a return with the country or possession from which your outside income was derived. 1040 ez 2010 pdf To avoid double taxation, a foreign tax credit is generally available for either the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf or Puerto Rico return. 1040 ez 2010 pdf Example. 1040 ez 2010 pdf Thomas Red is a bona fide resident of Puerto Rico and a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf citizen. 1040 ez 2010 pdf He traveled to the Dominican Republic and worked in the construction industry for 1 month. 1040 ez 2010 pdf His wages were $20,000. 1040 ez 2010 pdf Because the wages were earned outside Puerto Rico and outside the United States, Thomas must file a tax return with Puerto Rico and the United States. 1040 ez 2010 pdf He may also have to file a tax return with the Dominican Republic. 1040 ez 2010 pdf Moving expense deduction. 1040 ez 2010 pdf   Generally, expenses of a move to Puerto Rico are directly attributable to wages, salaries, and other earned income from Puerto Rico. 1040 ez 2010 pdf Likewise, the expenses of a move back to the United States are generally attributable to U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf earned income. 1040 ez 2010 pdf   If your move was to Puerto Rico, report your deduction for moving expenses as follows. 1040 ez 2010 pdf If you are a bona fide resident in the tax year of your move, enter your deductible expenses on your Puerto Rico tax return. 1040 ez 2010 pdf If you are not a bona fide resident, enter your deductible expenses on both your Puerto Rico and U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax returns. 1040 ez 2010 pdf Also, for purposes of a tax credit against your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax liability, reduce your Puerto Rico “general category income” on Form 1116, line 1a, by entering the deductible moving expenses on line 2. 1040 ez 2010 pdf   If your move was to the United States, complete Form 3903 and enter the deductible amount on Form 1040, line 26. 1040 ez 2010 pdf Additional child tax credit. 1040 ez 2010 pdf   If you are not required to file a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf income tax return, this credit is available only if you meet all three of the following conditions. 1040 ez 2010 pdf You were a bona fide resident of Puerto Rico during the entire tax year. 1040 ez 2010 pdf Social security and Medicare taxes were withheld from your wages or you paid self-employment tax. 1040 ez 2010 pdf You had three or more qualifying children. 1040 ez 2010 pdf (For the definition of a qualifying child, see the instructions for Form 1040-PR or Form 1040-SS. 1040 ez 2010 pdf ) If your income exceeds certain levels, you may be disqualified from receiving this credit. 1040 ez 2010 pdf Use Form 1040-PR or Form 1040-SS to claim the additional child tax credit. 1040 ez 2010 pdf Advice about possible tax benefits under the Puerto Rico investment incentive programs is available from the Puerto Rico tax authorities. 1040 ez 2010 pdf Double Taxation A mutual agreement procedure exists to settle cases of double taxation between the United States and the Commonwealth of Puerto Rico. 1040 ez 2010 pdf See Double Taxation in chapter 4. 1040 ez 2010 pdf The Commonwealth of the Northern Mariana Islands The Commonwealth of the Northern Mariana Islands (CNMI) has its own tax system based partly on the same tax laws and tax rates that apply to the United States and partly on local taxes imposed by the CNMI government. 1040 ez 2010 pdf Where To Get Forms and Information Requests for advice about CNMI residency and tax matters should be addressed to: Commonwealth of the Northern Mariana Islands  Division of Revenue and Taxation P. 1040 ez 2010 pdf O. 1040 ez 2010 pdf Box 5234 CHRB Dandan Commercial Center First Floor Rm #8  Saipan, MP 96950 You can order forms and publications by calling (670) 664-1000. 1040 ez 2010 pdf You can order forms and publications through the fax at (670) 664-1015. 1040 ez 2010 pdf You can get forms and publications at www. 1040 ez 2010 pdf cnmidof. 1040 ez 2010 pdf net. 1040 ez 2010 pdf The addresses and phone numbers listed above are subject to change. 1040 ez 2010 pdf Which Return To File In general, all individuals with income from the CNMI will file only one return, either to the CNMI or to the United States. 1040 ez 2010 pdf Your residency status with regard to the CNMI determines which return you will file. 1040 ez 2010 pdf Be sure to check the Special Rules for the CNMI , later, for additional information about filing your tax return. 1040 ez 2010 pdf Bona Fide Resident of the CNMI If you are a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf citizen, resident alien, or nonresident alien and a bona fide resident of the CNMI during the entire tax year, file your income tax return with the CNMI. 1040 ez 2010 pdf Include income from worldwide sources on your CNMI return. 1040 ez 2010 pdf In determining your total tax payments, include all income tax withheld by either the CNMI or the United States, any credit for an overpayment of income tax to either the CNMI or the United States, and any payments of estimated tax to either the CNMI or the United States. 1040 ez 2010 pdf Pay any balance of tax due with your tax return. 1040 ez 2010 pdf Generally, if you properly file your return with, and fully pay your income tax to, the CNMI, then you are not liable for filing an income tax return with, or for paying tax to, the United States for the tax year. 1040 ez 2010 pdf However, if you were self-employed in 2013, see Self-employment tax , later. 1040 ez 2010 pdf Example. 1040 ez 2010 pdf David Gold was a bona fide resident of the CNMI for 2013. 1040 ez 2010 pdf He received wages of $30,000 paid by a private employer in the CNMI and dividends of $4,000 from U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf corporations that carry on business mainly in the United States. 1040 ez 2010 pdf He must file a 2013 income tax return with the CNMI Division of Revenue and Taxation. 1040 ez 2010 pdf He reports his total income of $34,000 on the CNMI return. 1040 ez 2010 pdf   If you are a bona fide resident of the CNMI for the entire tax year, send your return and all attachments to the Division of Revenue and Taxation at the address given earlier. 1040 ez 2010 pdf U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Citizen or Resident Alien (Other Than a Bona Fide Resident of the CNMI) If you have income from sources within the CNMI and are a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf citizen or resident alien, but you are not a bona fide resident of the CNMI during the entire tax year, file your income tax return with the United States. 1040 ez 2010 pdf Include income from worldwide sources on your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf return. 1040 ez 2010 pdf In determining your total tax payments, include all income tax withheld by either the United States or the CNMI, any credit for an overpayment of income tax to either the United States or the CNMI, and any payments of estimated tax to either the United States or the CNMI. 1040 ez 2010 pdf Pay any balance of tax due with your tax return. 1040 ez 2010 pdf Note. 1040 ez 2010 pdf You may also need to complete Form 5074. 1040 ez 2010 pdf You are not liable for filing an income tax return with, or for paying tax to, the CNMI for the tax year. 1040 ez 2010 pdf Form 5074. 1040 ez 2010 pdf   If you file a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf income tax return, attach a completed Form 5074 if you (and your spouse if filing a joint return) have: Adjusted gross income of $50,000 or more for the tax year, and Gross income of $5,000 or more from sources within the CNMI. 1040 ez 2010 pdf   The United States and the CNMI use this form to divide your income taxes. 1040 ez 2010 pdf   There is an example of a filled-in Form 5074 in chapter 5. 1040 ez 2010 pdf De minimis exception to determining source of income. 1040 ez 2010 pdf   In certain situations you will not have income from a possession. 1040 ez 2010 pdf See De minimis exception under Compensation for Labor or Personal Services in chapter 2. 1040 ez 2010 pdf Citizen or resident alien of the United States but not a bona fide resident of the CNMI. 1040 ez 2010 pdf   If you are a citizen or resident alien of the United States but not a bona fide resident of the CNMI during the entire tax year and you are not including a check or a money order, send your return and all attachments to: Department of the Treasury Internal Revenue Service Austin, TX 73301-0215 USA   If you are including a check or a money order, send your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return and all attachments to: Internal Revenue Service P. 1040 ez 2010 pdf O. 1040 ez 2010 pdf Box 1303 Charlotte, NC 28201-1303 USA Nonresident Alien (Other Than a Bona Fide Resident of the CNMI) If you are a nonresident alien of the United States who does not qualify as a bona fide resident of the CNMI for the entire tax year, you generally must file the following returns. 1040 ez 2010 pdf A CNMI tax return reporting only your income from sources within the CNMI. 1040 ez 2010 pdf In this situation, wages for services performed in the CNMI, whether for a private employer, the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Government, or otherwise, is income from sources within the CNMI. 1040 ez 2010 pdf A U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return (Form 1040NR) reporting U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf source income according to the rules for a nonresident alien. 1040 ez 2010 pdf See the instructions for Form 1040NR. 1040 ez 2010 pdf If you are not a bona fide resident of the CNMI during the entire tax year and you are not including a check or a money order, send your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return and all attachments to: Department of the Treasury Internal Revenue Service Austin, TX 73301-0215 USA If you are including a check or a money order, send your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return and all attachments to:  Internal Revenue Service P. 1040 ez 2010 pdf O. 1040 ez 2010 pdf Box 1303 Charlotte, NC 28201-1303 USA Send your CNMI tax return and all attachments to:  Department of Finance Division of Revenue and Taxation Commonwealth of the Northern Mariana Islands P. 1040 ez 2010 pdf O. 1040 ez 2010 pdf Box 5234 CHRB Saipan, MP 96950 Citizen of the CNMI If you are a citizen of the CNMI (meaning that you were born or naturalized in the CNMI) but not otherwise a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf citizen or a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf resident alien during the tax year, file your income tax return with the CNMI. 1040 ez 2010 pdf Include income from worldwide sources on your CNMI return. 1040 ez 2010 pdf Take into account tax withheld by both jurisdictions in determining if there is tax overdue or an overpayment. 1040 ez 2010 pdf Pay any balance of tax due with your tax return. 1040 ez 2010 pdf Send your return and all attachments to:   Department of Finance Division of Revenue and Taxation Commonwealth of the Northern Mariana Islands P. 1040 ez 2010 pdf O. 1040 ez 2010 pdf Box 5234 CHRB Saipan, MP 96950 Special Rules for the CNMI Special rules apply to certain types of income, employment, and filing status. 1040 ez 2010 pdf Joint return. 1040 ez 2010 pdf   If you file a joint return, file your return (and pay the tax) with the jurisdiction where the spouse who has the greater adjusted gross income (AGI) would have to file if you were filing separately. 1040 ez 2010 pdf If the spouse with the greater AGI is a bona fide resident of the CNMI during the entire tax year, file the joint return with the CNMI. 1040 ez 2010 pdf If the spouse with the greater AGI is a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf citizen or resident alien but not a bona fide resident of the CNMI during the entire tax year, file your joint return with the United States. 1040 ez 2010 pdf For this purpose, income is determined without regard to community property laws. 1040 ez 2010 pdf Example. 1040 ez 2010 pdf Marsha Blue, a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf citizen, was a resident of the United States, and her spouse, a citizen of the CNMI, was a bona fide resident of the CNMI during the entire tax year. 1040 ez 2010 pdf Marsha earned $65,000 as a computer programmer in the United States. 1040 ez 2010 pdf Her spouse earned $20,000 as an artist in the CNMI. 1040 ez 2010 pdf Marsha and her spouse will file a joint return. 1040 ez 2010 pdf Because Marsha has the greater AGI, she and her spouse must file their return with the United States and report the entire $85,000 on that return. 1040 ez 2010 pdf U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Armed Forces. 1040 ez 2010 pdf   If you are a member of the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Armed Forces who qualified as a bona fide resident of the CNMI in a prior tax year, your absence from the CNMI solely in compliance with military orders will not change your bona fide residency. 1040 ez 2010 pdf If you did not qualify as a bona fide resident of the CNMI in a prior tax year, your presence in the CNMI solely in compliance with military orders will not qualify you as a bona fide resident of the CNMI. 1040 ez 2010 pdf Civilian spouse of active duty member of the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Armed Forces. 1040 ez 2010 pdf   If, under the rule discussed at the beginning of chapter 1 (see Special rule for civilian spouse of active duty member of the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Armed Forces ), your tax residence is the CNMI, follow the guidance in the section for bona fide residents under Which Return To File, earlier. 1040 ez 2010 pdf However, if your tax residence is one of the 50 states or the District of Columbia and your only income from the CNMI is from wages, salaries, tips, or self-employment, you will be taxed on your worldwide income and file only a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return (Form 1040) and a state and/or local tax return, if required. 1040 ez 2010 pdf If you have income from the CNMI other than wages, salaries, tips, or self-employment that is considered to be sourced in that possession (see Table 2-1), you may need to file Form 5074 with your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return. 1040 ez 2010 pdf Moving expense deduction. 1040 ez 2010 pdf   Generally, expenses of a move to the CNMI are directly attributable to wages, salaries, and other earned income from the CNMI. 1040 ez 2010 pdf Likewise, the expenses of a move back to the United States are generally attributable to U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf earned income. 1040 ez 2010 pdf   If your move was to the CNMI, report your deduction for moving expenses as follows. 1040 ez 2010 pdf If you are a bona fide resident in the tax year of your move, enter your deductible expenses on your CNMI tax return. 1040 ez 2010 pdf If you are not a bona fide resident, enter your deductible expenses on Form 3903 and enter the deductible amount on Form 1040, line 26, and on Form 5074, line 20. 1040 ez 2010 pdf   If your move was to the United States, complete Form 3903 and enter the deductible amount on Form 1040, line 26. 1040 ez 2010 pdf Foreign tax credit. 1040 ez 2010 pdf   Under the filing rules explained earlier, individuals with CNMI source income normally will not claim a foreign tax credit on a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf income tax return for tax paid to the CNMI. 1040 ez 2010 pdf Self-employment tax. 1040 ez 2010 pdf   If you have no U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf filing requirement, but have income that is effectively connected with a trade or business in the CNMI, you must file Form 1040-SS with the United States to report your self-employment income and, if necessary, pay self-employment tax. 1040 ez 2010 pdf Additional Medicare Tax. 1040 ez 2010 pdf   Beginning in 2013, you may be required to pay Additional Medicare Tax. 1040 ez 2010 pdf Also, you may need to report Additional Medicare Tax withheld by your employer. 1040 ez 2010 pdf For more information see Additional Medicare Tax under Special Rules for Completing Your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Tax Return in chapter 4. 1040 ez 2010 pdf Estimated tax payments. 1040 ez 2010 pdf   To see if you are required to make payments of estimated income tax, self-employment tax, and/or Additional Medicare Tax to the IRS, get Form 1040-ES. 1040 ez 2010 pdf Payment of estimated tax. 1040 ez 2010 pdf   If you must pay estimated tax, make your payment to the jurisdiction where you would file your income tax return if your tax year were to end on the date your first estimated tax payment is due. 1040 ez 2010 pdf Generally, you should make the rest of your quarterly payments of estimated tax to the jurisdiction where you made your first payment of estimated tax. 1040 ez 2010 pdf However, estimated tax payments to either jurisdiction will be treated as payments to the jurisdiction with which you file the tax return. 1040 ez 2010 pdf   If you make a joint payment of estimated tax, make your payment to the jurisdiction where the spouse who has the greater estimated AGI would have to pay (if a separate payment were made). 1040 ez 2010 pdf For this purpose, income is determined without regard to community property laws. 1040 ez 2010 pdf Early payment. 1040 ez 2010 pdf   If you make your first payment of estimated tax early, follow the rules given earlier to determine where to send it. 1040 ez 2010 pdf If you send it to the wrong jurisdiction, make all later payments to the jurisdiction to which the first payment should have been sent. 1040 ez 2010 pdf   To pay by check or money order, send your payment with the Form 1040-ES payment voucher to:  Internal Revenue Service P. 1040 ez 2010 pdf O. 1040 ez 2010 pdf Box 1300 Charlotte, NC 28201-1300 USA   To get information on paying electronically (by credit or debit card, or through the Electronic Federal Tax Payment System (EFTPS)), go to www. 1040 ez 2010 pdf irs. 1040 ez 2010 pdf gov/e-pay. 1040 ez 2010 pdf   For information on making estimated income tax payments to the CNMI, see Where To Get Forms and Information , earlier. 1040 ez 2010 pdf Double Taxation A mutual agreement procedure exists to settle cases of double taxation between the United States and the CNMI. 1040 ez 2010 pdf See Double Taxation in chapter 4. 1040 ez 2010 pdf Guam Guam has its own tax system based on the same tax laws and tax rates that apply in the United States. 1040 ez 2010 pdf Where To Get Forms and Information Requests for advice about Guam residency and tax matters should be addressed to: Department of Revenue and Taxation Government of Guam P. 1040 ez 2010 pdf O. 1040 ez 2010 pdf Box 23607 GMF, GU 96921 You can order forms and publications by calling (671) 635-1840 or (671) 635-1841. 1040 ez 2010 pdf You can order forms and publications through the fax at (671) 633-2643. 1040 ez 2010 pdf You can get forms and publications at www. 1040 ez 2010 pdf guamtax. 1040 ez 2010 pdf com. 1040 ez 2010 pdf The addresses and phone numbers listed above are subject to change. 1040 ez 2010 pdf Which Return To File Bona fide residents of Guam are subject to special U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax rules. 1040 ez 2010 pdf In general, all individuals with income from Guam will file only one return—either to Guam or the United States. 1040 ez 2010 pdf Bona Fide Resident of Guam If you are a bona fide resident of Guam during the entire tax year, file your return with Guam. 1040 ez 2010 pdf This applies to all bona fide residents who are citizens, resident aliens, or nonresident aliens of the United States. 1040 ez 2010 pdf Include income from worldwide sources on your Guam return. 1040 ez 2010 pdf In determining your total tax payments, include all income tax withheld by either Guam or the United States, any credit for an overpayment of income tax to either Guam or the United States, and any payments of estimated tax to either Guam or the United States. 1040 ez 2010 pdf Pay any balance of tax due with your tax return. 1040 ez 2010 pdf Generally, if you properly file your return with, and fully pay your income tax to, Guam, then you are not liable for filing an income tax return with, or for paying tax to, the United States. 1040 ez 2010 pdf However, if you were self-employed in 2013, see Self-employment tax , later. 1040 ez 2010 pdf Example. 1040 ez 2010 pdf Gary Barker was a bona fide resident of Guam for 2013. 1040 ez 2010 pdf He received wages of $25,000 paid by a private employer in Guam and dividends of $2,000 from U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf corporations that carry on business mainly in the United States. 1040 ez 2010 pdf He must file a 2013 income tax return with the Government of Guam. 1040 ez 2010 pdf He reports his total income of $27,000 on the Guam return. 1040 ez 2010 pdf If you are a bona fide resident of Guam for the entire tax year, send your return and all attachments to:  Department of Revenue and Taxation Government of Guam P. 1040 ez 2010 pdf O. 1040 ez 2010 pdf Box 23607 GMF, GU 96921 U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Citizen or Resident Alien (Other Than a Bona Fide Resident of Guam) If you have income from sources within Guam and are a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf citizen or resident alien, but you are not a bona fide resident of Guam during the entire tax year, file your income tax return with the United States. 1040 ez 2010 pdf Include income from worldwide sources on your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf return. 1040 ez 2010 pdf In determining your total tax payments, include all income tax withheld by either the United States or Guam, any credit for an overpayment of income tax to either the United States or Guam, and any payments of estimated tax to either the United States or Guam. 1040 ez 2010 pdf Pay any balance of tax due with your tax return. 1040 ez 2010 pdf You may also need to complete Form 5074. 1040 ez 2010 pdf You are not liable for filing an income tax return with, or for paying tax to, Guam for the tax year. 1040 ez 2010 pdf Form 5074. 1040 ez 2010 pdf   If you file a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf income tax return, attach a completed Form 5074 if you (and your spouse if filing a joint return) have: Adjusted gross income of $50,000 or more for the tax year, and Gross income of $5,000 or more from sources within Guam. 1040 ez 2010 pdf   The United States and Guam use this form to divide your income taxes. 1040 ez 2010 pdf   See the Illustrated Example of Form 5074 in chapter 5. 1040 ez 2010 pdf De minimis exception to determining source of income. 1040 ez 2010 pdf   In certain situations you will not have income from a possession. 1040 ez 2010 pdf See De minimis exception under Compensation for Labor or Personal Services in chapter 2. 1040 ez 2010 pdf   If you are a citizen or resident alien of the United States but not a bona fide resident of Guam during the entire tax year and you are not including a check or money order, send your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return and all attachments (including Form 5074) to:  Department of the Treasury Internal Revenue Service Austin, TX 73301-0215 USA   If you are including a check or a money order, send your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return and all attachments (including Form 5074) to:  Internal Revenue Service P. 1040 ez 2010 pdf O. 1040 ez 2010 pdf Box 1303 Charlotte, NC 28201-1303 USA Nonresident Alien (Other Than a Bona Fide Resident of Guam) If you are a nonresident alien of the United States who does not qualify as a bona fide resident of Guam for the entire tax year, you generally must file the following returns. 1040 ez 2010 pdf A Guam tax return reporting only your income from sources within Guam. 1040 ez 2010 pdf In this situation, wages for services performed in Guam, whether for a private employer, the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Government, or otherwise, is income from sources within Guam. 1040 ez 2010 pdf A U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return (Form 1040NR) reporting U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf source income according to the rules for a nonresident alien. 1040 ez 2010 pdf See the instructions for Form 1040NR. 1040 ez 2010 pdf If you are not a bona fide resident of Guam during the entire tax year and you are not including a check or money order, send your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return and all attachments to:  Department of the Treasury Internal Revenue Service Austin, TX 73301-0215 USA If you are including a check or a money order, send your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return and all attachments to:  Internal Revenue Service P. 1040 ez 2010 pdf O. 1040 ez 2010 pdf Box 1303 Charlotte, NC 28201-1303 USA Send your Guam tax return and all attachments to:   Department of Revenue and Taxation P. 1040 ez 2010 pdf O. 1040 ez 2010 pdf Box 23607 GMF, GU 96921 Citizen of Guam If you are a citizen of Guam (meaning that you were born or naturalized in Guam) but not otherwise a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf citizen or a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf resident alien during the tax year, file your income tax return with Guam. 1040 ez 2010 pdf Include income from worldwide sources on your Guam return. 1040 ez 2010 pdf Take into account tax withheld by both jurisdictions in determining if there is tax overdue or an overpayment. 1040 ez 2010 pdf Pay any balance of tax due with your tax return. 1040 ez 2010 pdf If you are a citizen of Guam, send your return and all attachments to:  Department of Revenue and Taxation Government of Guam P. 1040 ez 2010 pdf O. 1040 ez 2010 pdf Box 23607 GMF, GU 96921 Special Rules for Guam Special rules apply to certain types of income, employment, and filing status. 1040 ez 2010 pdf Joint return. 1040 ez 2010 pdf   If you file a joint return, you should file your return (and pay the tax) with the jurisdiction where the spouse who has the greater adjusted gross income (AGI) would have to file if you were filing separately. 1040 ez 2010 pdf If the spouse with the greater AGI is a bona fide resident of Guam during the entire tax year, file the joint return with Guam. 1040 ez 2010 pdf If the spouse with the greater AGI is a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf citizen or resident alien but not a bona fide resident of Guam during the entire tax year, file the joint return with the United States. 1040 ez 2010 pdf For this purpose, income is determined without regard to community property laws. 1040 ez 2010 pdf Example. 1040 ez 2010 pdf Bill Whiting, a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf citizen, was a resident of the United States, and his spouse, a citizen of Guam, was a bona fide resident of Guam during the entire tax year. 1040 ez 2010 pdf Bill earned $45,000 as an engineer in the United States. 1040 ez 2010 pdf His spouse earned $15,000 as a teacher in Guam. 1040 ez 2010 pdf Bill and his spouse will file a joint return. 1040 ez 2010 pdf Because Bill has the greater AGI, he and his spouse must file their return with the United States and report the entire $60,000 on that return. 1040 ez 2010 pdf U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Armed Forces. 1040 ez 2010 pdf   If you are a member of the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Armed Forces who qualified as a bona fide resident of Guam in a prior tax year, your absence from Guam solely in compliance with military orders will not change your bona fide residency. 1040 ez 2010 pdf If you did not qualify as a bona fide resident of Guam in a prior tax year, your presence in Guam solely in compliance with military orders will not qualify you as a bona fide resident of Guam. 1040 ez 2010 pdf Civilian spouse of active duty member of the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Armed Forces. 1040 ez 2010 pdf   If, under the rule discussed at the beginning of chapter 1 (see Special rule for civilian spouse of active duty member of the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Armed Forces ), your tax residence is Guam, follow the guidance in the section for bona fide residents under Which Return To File, earlier. 1040 ez 2010 pdf However, if your tax residence is one of the 50 states or the District of Columbia and your only income from Guam is from wages, salaries, tips, or self-employment, you will be taxed on your worldwide income and file only a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return (Form 1040) and a state and/or local tax return, if required. 1040 ez 2010 pdf If you have income from Guam other than wages, salaries, tips, or self-employment that is considered to be sourced in that possession (see Table 2-1), you may need to file Form 5074 with your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return. 1040 ez 2010 pdf Moving expense deduction. 1040 ez 2010 pdf   Generally, expenses of a move to Guam are directly attributable to wages, salaries, and other earned income from Guam. 1040 ez 2010 pdf Likewise, the expenses of a move back to the United States are generally attributable to U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf earned income. 1040 ez 2010 pdf   If your move was to Guam, report your deduction for moving expenses as follows. 1040 ez 2010 pdf If you are a bona fide resident in the tax year of your move, enter your deductible expenses on your Guam tax return. 1040 ez 2010 pdf If you are not a bona fide resident, enter your deductible expenses on Form 3903 and enter the deductible amount on Form 1040, line 26, and on Form 5074, line 20. 1040 ez 2010 pdf   If your move was to the United States, complete Form 3903 and enter the deductible amount on Form 1040, line 26. 1040 ez 2010 pdf Foreign tax credit. 1040 ez 2010 pdf   Under the filing rules explained earlier, individuals with Guam source income normally will not claim a foreign tax credit on a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf income tax return for tax paid to Guam. 1040 ez 2010 pdf Self-employment tax. 1040 ez 2010 pdf   If you have no U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf filing requirement, but have income that is effectively connected with a trade or business in Guam, you must file Form 1040-SS with the United States to report your self-employment income and, if necessary, pay self-employment tax. 1040 ez 2010 pdf Additional Medicare Tax. 1040 ez 2010 pdf   Beginning in 2013, you may be required to pay Additional Medicare Tax. 1040 ez 2010 pdf Also, you may need to report Additional Medicare Tax withheld by your employer. 1040 ez 2010 pdf For more information see Additional Medicare Tax under Special Rules for Completing Your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Tax Return in chapter 4. 1040 ez 2010 pdf Estimated tax payments. 1040 ez 2010 pdf   To see if you are required to make payments of estimated income tax, self-employment tax, and/or Additional Medicare Tax, to the IRS, get Form 1040-ES. 1040 ez 2010 pdf Payment of estimated tax. 1040 ez 2010 pdf   If you must pay estimated tax, make your payment to the jurisdiction where you would file your income tax return if your tax year were to end on the date your first estimated tax payment is due. 1040 ez 2010 pdf Generally, you should make the rest of your quarterly payments of estimated tax to the jurisdiction where you made your first payment of estimated tax. 1040 ez 2010 pdf However, estimated tax payments to either jurisdiction will be treated as payments to the jurisdiction with which you file the tax return. 1040 ez 2010 pdf   If you make a joint payment of estimated tax, make your payment to the jurisdiction where the spouse who has the greater estimated AGI would have to pay (if a separate payment were made). 1040 ez 2010 pdf For this purpose, income is determined without regard to community property laws. 1040 ez 2010 pdf Early payment. 1040 ez 2010 pdf   If you make your first payment of estimated tax early, follow the rules given earlier to determine where to send it. 1040 ez 2010 pdf If you send it to the wrong jurisdiction, make all later payments to the jurisdiction to which the first payment should have been sent. 1040 ez 2010 pdf   To pay by check or money order, send your payment with the Form 1040-ES payment voucher to:  Department of Revenue and Taxation Government of Guam P. 1040 ez 2010 pdf O. 1040 ez 2010 pdf Box 23607 GMF, GU 96921   To get information on paying electronically (by credit or debit card, or through the Electronic Federal Tax Payment System (EFTPS)), go to www. 1040 ez 2010 pdf irs. 1040 ez 2010 pdf gov/e-pay. 1040 ez 2010 pdf   For information on making estimated income tax payments to the Department of Revenue and Taxation, see Where To Get Forms and Information , earlier. 1040 ez 2010 pdf Double Taxation A mutual agreement procedure exists to settle cases of double taxation between the United States and Guam. 1040 ez 2010 pdf See Double Taxation in chapter 4. 1040 ez 2010 pdf The U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Virgin Islands The U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Virgin Islands has its own tax system based on the same tax laws and tax rates that apply in the United States. 1040 ez 2010 pdf An important factor in USVI taxation is whether, during the entire tax year, you are a bona fide resident of the USVI. 1040 ez 2010 pdf Where To Get Forms and Information For information about filing your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Virgin Islands tax return or about Form 1040INFO, in St. 1040 ez 2010 pdf Thomas contact : Bureau of Internal Revenue  6115 Estate Smith Bay  St. 1040 ez 2010 pdf Thomas, VI 00802 You can order forms and publications by calling (340) 715-1040. 1040 ez 2010 pdf You can order forms and publications through the fax at (340) 774-2672. 1040 ez 2010 pdf For information about filing your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Virgin Islands tax return or about Form 1040INFO, in St. 1040 ez 2010 pdf Croix contact : Bureau of Internal Revenue  4008 Estate Diamond- Plot 7B Christiansted, V. 1040 ez 2010 pdf I. 1040 ez 2010 pdf 00820–4421 You can order forms and publications by calling (340) 773-1040. 1040 ez 2010 pdf You can order forms and publications through the fax at (340) 773-1006. 1040 ez 2010 pdf You can access the USVI website at www. 1040 ez 2010 pdf viirb. 1040 ez 2010 pdf com. 1040 ez 2010 pdf The addresses and phone numbers listed above are subject to change. 1040 ez 2010 pdf Which Return To File In general, bona fide residents of the USVI pay taxes only to the USVI. 1040 ez 2010 pdf U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf citizens or resident aliens (but not bona fide residents of the USVI) with USVI source income pay a portion of the tax to each jurisdiction. 1040 ez 2010 pdf Bona Fide Resident of the USVI File your tax return with the USVI if you are a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf citizen, resident alien, or nonresident alien and a bona fide resident of the USVI during the entire tax year. 1040 ez 2010 pdf Include your worldwide income on your USVI return. 1040 ez 2010 pdf In determining your total tax payments, take into account all income tax withheld by either the USVI or the United States, any credit for an overpayment of income tax to either the USVI or the United States, and any payments of estimated tax to either the USVI or the United States. 1040 ez 2010 pdf Pay any balance of tax due with your tax return. 1040 ez 2010 pdf Filing this return with the USVI generally also starts the statute of limitations on assessment of your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf income tax. 1040 ez 2010 pdf You generally do not have to file with the United States for any tax year in which you are a bona fide resident of the USVI during the entire tax year, provided you report and pay tax on your income from all sources to the USVI and identify the source(s) of the income on the return. 1040 ez 2010 pdf However, if you have self-employment income, you may be required to file Form 1040-SS with the United States. 1040 ez 2010 pdf For more information, see Self-employment tax under Special Rules for the USVI, later. 1040 ez 2010 pdf Form 1040INFO. 1040 ez 2010 pdf   If you are a bona fide resident of the USVI and have non-USVI source income, you must also file Virgin Islands Form 1040INFO, Non-Virgin Islands Source Income of Virgin Islands Residents, with the Virgin Islands Bureau of Internal Revenue. 1040 ez 2010 pdf Attach Form 1040INFO to your USVI tax return before filing. 1040 ez 2010 pdf You can get Form 1040INFO by contacting the address or website given earlier. 1040 ez 2010 pdf   If you are a bona fide resident of the USVI for the entire tax year, file your return and all attachments with the Virgin Islands Bureau of Internal Revenue at:  USVI Bureau of Internal Revenue 6115 Estate Smith Bay St. 1040 ez 2010 pdf Thomas, VI 00802 U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Citizen or Resident Alien (Other Than a Bona Fide Resident of the USVI) If you are a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf citizen or resident alien but not a bona fide resident of the USVI during the entire tax year, you must file your original Form 1040 with the United States and an identical copy of that return with the USVI if you have: Income from sources in the USVI, or Income effectively connected with the conduct of a trade or business in the USVI. 1040 ez 2010 pdf File your original Form 1040 with the United States and file a signed copy of the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf return (including all attachments, forms, and schedules) with the Virgin Islands Bureau of Internal Revenue by the due date for filing Form 1040. 1040 ez 2010 pdf Use Form 8689 to figure the amount of tax you must pay to the USVI. 1040 ez 2010 pdf Form 8689. 1040 ez 2010 pdf   Complete this form and attach it to both the return you file with the United States and the copy you file with the USVI. 1040 ez 2010 pdf Figure the amount of tax you must pay to the USVI as follows:      Total tax on  U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf return (after certain adjustments) × USVI AGI Worldwide AGI     Pay any tax due to the USVI when you file your return with the Virgin Islands Bureau of Internal Revenue. 1040 ez 2010 pdf To receive credit on your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf return for taxes paid to the USVI, include the amounts from Form 8689, lines 40 and 45, in the total on Form 1040, line 72. 1040 ez 2010 pdf On the dotted line next to line 72, enter “Form 8689” and show the amounts. 1040 ez 2010 pdf   See the illustrated example in chapter 5. 1040 ez 2010 pdf De minimis exception to determining source of income. 1040 ez 2010 pdf   In certain situations you will not have income from a possession. 1040 ez 2010 pdf See De minimis exception under Compensation for Labor or Personal Services in chapter 2. 1040 ez 2010 pdf   If you are not a bona fide resident of the USVI during the entire tax year, but you have USVI source income, and you are not including a check or a money order, file Form 1040 and all attachments (including Form 8689) with the:  Department of the Treasury Internal Revenue Service Austin, TX 73301-0215 USA   If you are including a check or a money order, send your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return and all attachments (including Form 8689) to:  Internal Revenue Service P. 1040 ez 2010 pdf O. 1040 ez 2010 pdf Box 1303 Charlotte, NC 28201-1303 USA   File a copy of your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Form 1040 with the Virgin Islands Bureau of Internal Revenue at:  USVI Bureau of Internal Revenue 6115 Estate Smith Bay St. 1040 ez 2010 pdf Thomas, VI 00802 Nonresident Alien (Other Than a Bona Fide Resident of the USVI) If you are a nonresident alien of the United States who does not qualify as a bona fide resident of the USVI for the entire tax year, you generally must file the following returns. 1040 ez 2010 pdf A USVI tax return reporting only your income from sources within the USVI. 1040 ez 2010 pdf In this situation, wages for services performed in the USVI, whether for a private employer, the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Government, or otherwise, is income from sources within the USVI. 1040 ez 2010 pdf A U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return (Form 1040NR) reporting U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf source income according to the rules for a nonresident alien. 1040 ez 2010 pdf See the instructions for Form 1040NR. 1040 ez 2010 pdf   If you are not a bona fide resident of the USVI during the entire tax year, and you are not including a check or a money order, send your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return and all attachments (including Form 8689) to:  Department of the Treasury Internal Revenue Service Austin, TX 73301-0215 USA   If you are including a check or a money order, send your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return and all attachments (including Form 8689) to:  Internal Revenue Service P. 1040 ez 2010 pdf O. 1040 ez 2010 pdf Box 1303 Charlotte, NC 28201-1303  USA   Send your USVI tax return and all attachments to:  Bureau of Internal Revenue 6115 Estate Smith Bay St. 1040 ez 2010 pdf Thomas, VI 00802 Special Rules for the USVI There are some special rules for certain types of income, employment, and filing status. 1040 ez 2010 pdf Joint return. 1040 ez 2010 pdf   If you file a joint return, you should file your return (and pay the tax) with the jurisdiction where the spouse who has the greater adjusted gross income (AGI) would have to file if you were filing separately. 1040 ez 2010 pdf If the spouse with the greater AGI is a bona fide resident of the USVI during the entire tax year, file the joint return with the USVI. 1040 ez 2010 pdf If the spouse with the greater AGI is a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf citizen or resident alien of the United States but not a bona fide resident of the USVI during the entire tax year, file the joint return with the United States. 1040 ez 2010 pdf For this purpose, income is determined without regard to community property laws. 1040 ez 2010 pdf Example. 1040 ez 2010 pdf Marge Birch, a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf citizen, was a resident of the United States, and her spouse, a citizen of the USVI, was a bona fide resident of the USVI during the entire tax year. 1040 ez 2010 pdf Marge earned $55,000 as an architect in the United States. 1040 ez 2010 pdf Her spouse earned $30,000 as a librarian in the USVI. 1040 ez 2010 pdf Marge and her spouse will file a joint return. 1040 ez 2010 pdf Because Marge has the greater AGI, she and her spouse must file their return with the United States and report the entire $85,000 on that return. 1040 ez 2010 pdf U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Armed Forces. 1040 ez 2010 pdf   If you are a member of the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Armed Forces who qualified as a bona fide resident of the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Virgin Islands in a prior tax year, your absence from the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Virgin Islands solely in compliance with military orders will not change your bona fide residency. 1040 ez 2010 pdf If you did not qualify as a bona fide resident of the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Virgin Islands in a prior tax year, your presence in the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Virgin Islands solely in compliance with military orders will not qualify you as a bona fide resident of the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Virgin Islands. 1040 ez 2010 pdf Civilian spouse of active duty member of the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Armed Forces. 1040 ez 2010 pdf   If, under the rule discussed at the beginning of chapter 1 (see Special rule for civilian spouse of active duty member of the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Armed Forces ), your tax residence is the USVI, follow the guidance in the section for bona fide residents under Which Return To File, earlier. 1040 ez 2010 pdf However, if your tax residence is one of the 50 states or the District of Columbia and your only income from the USVI is from wages, salaries, tips, or self-employment, you will be taxed on your worldwide income and file only a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return (Form 1040) and a state and/or local tax return, if required. 1040 ez 2010 pdf If you have income from the USVI other than wages, salaries, tips, or self-employment that is considered to be sourced in that possession (see Table 2-1), you may need to file Form 8689 with your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf tax return. 1040 ez 2010 pdf In this case, follow the guidance under U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Citizen or Resident Alien (Other Than a Bona Fide Resident of the USVI ), earlier. 1040 ez 2010 pdf Moving expense deduction. 1040 ez 2010 pdf   Generally, expenses of a move to the USVI are directly attributable to wages, salaries, and other earned income from the USVI. 1040 ez 2010 pdf Likewise, the expenses of a move back to the United States are generally attributable to U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf earned income. 1040 ez 2010 pdf   If your move was to the USVI, report your deduction for moving expenses as follows. 1040 ez 2010 pdf If you are a bona fide resident in the tax year of your move, enter your deductible expenses on your USVI tax return. 1040 ez 2010 pdf If you are not a bona fide resident, enter your deductible expenses on Form 3903 and enter the deductible amount on Form 1040, line 26, and on Form 8689, line 20. 1040 ez 2010 pdf   If your move was to the United States, complete Form 3903 and enter the deductible amount on Form 1040, line 26. 1040 ez 2010 pdf Foreign tax credit. 1040 ez 2010 pdf   Under the filing rules explained earlier, individuals with USVI source income normally will not claim a foreign tax credit on a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf income tax return for tax paid to the USVI. 1040 ez 2010 pdf However, individuals other than bona fide residents of the USVI may claim a direct credit for such tax (see Form 8689 earlier in this section). 1040 ez 2010 pdf Self-employment tax. 1040 ez 2010 pdf   If you have no U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf filing requirement, but have income that is effectively connected with a trade or business in the USVI, you must file Form 1040-SS with the United States to report your self-employment income and, if necessary, pay self-employment tax. 1040 ez 2010 pdf Additional Medicare Tax. 1040 ez 2010 pdf   Beginning in 2013, you may be required to pay Additional Medicare Tax. 1040 ez 2010 pdf Also, you may need to report Additional Medicare Tax withheld by your employer. 1040 ez 2010 pdf For more information see Additional Medicare Tax under Special Rules for Completing Your U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Tax Return in chapter 4. 1040 ez 2010 pdf Estimated tax payments. 1040 ez 2010 pdf   To see if you are required to make payments of estimated income tax, self-employment tax, and/or Additional Medicare Tax, to the IRS, get Form 1040-ES. 1040 ez 2010 pdf   To pay by check or money order, send your payment with the Form 1040-ES payment voucher to:  Virgin Islands Bureau of Internal Revenue 6115 Estate Smith Bay St. 1040 ez 2010 pdf Thomas, VI 00802   To get information on paying electronically (by credit or debit card, or through the Electronic Federal Tax Payment System (EFTPS)), go to www. 1040 ez 2010 pdf irs. 1040 ez 2010 pdf gov/e-pay. 1040 ez 2010 pdf   For information on making estimated income tax payments to the Bureau of Internal Revenue, see Where To Get Forms and Information , earlier. 1040 ez 2010 pdf Extension of time to file. 1040 ez 2010 pdf   You can get an automatic 6-month extension of time to file your tax return. 1040 ez 2010 pdf See Extension of Time To File in chapter 4. 1040 ez 2010 pdf Bona fide residents of the USVI during the entire tax year must file a paper Form 4868 with the Virgin Islands Bureau of Internal Revenue. 1040 ez 2010 pdf Nonresidents of the USVI should file separate extension requests with the IRS and the Virgin Islands Bureau of Internal Revenue and make any payments due to the respective jurisdictions. 1040 ez 2010 pdf However, the Virgin Islands Bureau of Internal Revenue will honor an extension request that is timely filed with the IRS. 1040 ez 2010 pdf Double Taxation A mutual agreement procedure exists to settle cases of double taxation between the United States and the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Virgin Islands. 1040 ez 2010 pdf See Double Taxation in chapter 4. 1040 ez 2010 pdf Prev  Up  Next   Home   More Online Publications
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The 1040 Ez 2010 Pdf

1040 ez 2010 pdf 5. 1040 ez 2010 pdf   Business Income Table of Contents Introduction Kinds of IncomeBartering for Property or Services Real Estate Rents Personal Property Rents Interest and Dividend Income Canceled Debt Other Income Items That Are Not IncomeAmount you can exclude. 1040 ez 2010 pdf Short-term lease. 1040 ez 2010 pdf Retail space. 1040 ez 2010 pdf Qualified long-term real property. 1040 ez 2010 pdf Guidelines for Selected Occupations Accounting for Your Income Introduction This chapter primarily explains business income and how to account for it on your tax return, what items are not considered income, and gives guidelines for selected occupations. 1040 ez 2010 pdf If there is a connection between any income you receive and your business, the income is business income. 1040 ez 2010 pdf A connection exists if it is clear that the payment of income would not have been made if you did not have the business. 1040 ez 2010 pdf You can have business income even if you are not involved in the activity on a regular full-time basis. 1040 ez 2010 pdf Income from work you do on the side in addition to your regular job can be business income. 1040 ez 2010 pdf You report most business income, such as income from selling your products or services, on Schedule C or C-EZ. 1040 ez 2010 pdf But you report the income from the sale of business assets, such as land and office buildings, on other forms instead of Schedule C or C-EZ. 1040 ez 2010 pdf For information on selling business assets, see chapter 3. 1040 ez 2010 pdf Nonemployee compensation. 1040 ez 2010 pdf Business income includes amounts you received in your business that were properly shown on Forms 1099-MISC. 1040 ez 2010 pdf This includes amounts reported as nonemployee compensation in box 7 of the form. 1040 ez 2010 pdf You can find more information in the instructions on the back of the Form 1099-MISC you received. 1040 ez 2010 pdf Kinds of Income You must report on your tax return all income you receive from your business unless it is excluded by law. 1040 ez 2010 pdf In most cases, your business income will be in the form of cash, checks, and credit card charges. 1040 ez 2010 pdf But business income can be in other forms, such as property or services. 1040 ez 2010 pdf These and other types of income are explained next. 1040 ez 2010 pdf If you are a U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf citizen who has business income from sources outside the United States (foreign income), you must report that income on your tax return unless it is exempt from tax under U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf law. 1040 ez 2010 pdf If you live outside the United States, you may be able to exclude part or all of your foreign-source business income. 1040 ez 2010 pdf For details, see Publication 54, Tax Guide for U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Citizens and Resident Aliens Abroad. 1040 ez 2010 pdf Bartering for Property or Services Bartering is an exchange of property or services. 1040 ez 2010 pdf You must include in your gross receipts, at the time received, the fair market value of property or services you receive in exchange for something else. 1040 ez 2010 pdf If you exchange services with another person and you both have agreed ahead of time on the value of the services, that value will be accepted as the fair market value unless the value can be shown to be otherwise. 1040 ez 2010 pdf Example 1. 1040 ez 2010 pdf You are a self-employed lawyer. 1040 ez 2010 pdf You perform legal services for a client, a small corporation. 1040 ez 2010 pdf In payment for your services, you receive shares of stock in the corporation. 1040 ez 2010 pdf You must include the fair market value of the shares in income. 1040 ez 2010 pdf Example 2. 1040 ez 2010 pdf You are an artist and create a work of art to compensate your landlord for the rent-free use of your apartment. 1040 ez 2010 pdf You must include the fair rental value of the apartment in your gross receipts. 1040 ez 2010 pdf Your landlord must include the fair market value of the work of art in his or her rental income. 1040 ez 2010 pdf Example 3. 1040 ez 2010 pdf You are a self-employed accountant. 1040 ez 2010 pdf Both you and a house painter are members of a barter club, an organization that each year gives its members a directory of members and the services each member provides. 1040 ez 2010 pdf Members get in touch with other members directly and bargain for the value of the services to be performed. 1040 ez 2010 pdf In return for accounting services you provided for the house painter's business, the house painter painted your home. 1040 ez 2010 pdf You must include in gross receipts the fair market value of the services you received from the house painter. 1040 ez 2010 pdf The house painter must include the fair market value of your accounting services in his or her gross receipts. 1040 ez 2010 pdf Example 4. 1040 ez 2010 pdf You are a member of a barter club that uses credit units to credit or debit members' accounts for goods or services provided or received. 1040 ez 2010 pdf As soon as units are credited to your account, you can use them to buy goods or services or sell or transfer the units to other members. 1040 ez 2010 pdf You must include the value of credit units you received in your gross receipts for the tax year in which the units are credited to your account. 1040 ez 2010 pdf The dollar value of units received for services by an employee of the club, who can use the units in the same manner as other members, must be included in the employee's gross income for the tax year in which received. 1040 ez 2010 pdf It is wages subject to social security and Medicare taxes (FICA), federal unemployment taxes (FUTA), and income tax withholding. 1040 ez 2010 pdf See Publication 15 (Circular E), Employer's Tax Guide. 1040 ez 2010 pdf Example 5. 1040 ez 2010 pdf You operate a plumbing business and use the cash method of accounting. 1040 ez 2010 pdf You join a barter club and agree to provide plumbing services to any member for a specified number of hours. 1040 ez 2010 pdf Each member has access to a directory that lists the members of the club and the services available. 1040 ez 2010 pdf Members contact each other directly and request services to be performed. 1040 ez 2010 pdf You are not required to provide services unless requested by another member, but you can use as many of the offered services as you wish without paying a fee. 1040 ez 2010 pdf You must include the fair market value of any services you receive from club members in your gross receipts when you receive them even if you have not provided any services to club members. 1040 ez 2010 pdf Information returns. 1040 ez 2010 pdf   If you are involved in a bartering transaction, you may have to file either of the following forms. 1040 ez 2010 pdf Form 1099-B, Proceeds From Broker and Barter Exchange Transactions. 1040 ez 2010 pdf Form 1099-MISC, Miscellaneous Income. 1040 ez 2010 pdf For information about these forms, see the General Instructions for Certain Information Returns. 1040 ez 2010 pdf Real Estate Rents If you are a real estate dealer who receives income from renting real property or an owner of a hotel, motel, etc. 1040 ez 2010 pdf , who provides services (maid services, etc. 1040 ez 2010 pdf ) for guests, report the rental income and expenses on Schedule C or C-EZ. 1040 ez 2010 pdf If you are not a real estate dealer or the kind of owner described in the preceding sentence, report the rental income and expenses on Schedule E. 1040 ez 2010 pdf For more information, see Publication 527, Residential Rental Property (Including Rental of Vacation Homes). 1040 ez 2010 pdf Real estate dealer. 1040 ez 2010 pdf   You are a real estate dealer if you are engaged in the business of selling real estate to customers with the purpose of making a profit from those sales. 1040 ez 2010 pdf Rent you receive from real estate held for sale to customers is subject to SE tax. 1040 ez 2010 pdf However, rent you receive from real estate held for speculation or investment is not subject to SE tax. 1040 ez 2010 pdf Trailer park owner. 1040 ez 2010 pdf   Rental income from a trailer park is subject to SE tax if you are a self-employed trailer park owner who provides trailer lots and facilities and substantial services for the convenience of your tenants. 1040 ez 2010 pdf    You generally are considered to provide substantial services for tenants if they are primarily for the tenants' convenience and normally are not provided to maintain the lots in a condition for occupancy. 1040 ez 2010 pdf Services are substantial if the compensation for the services makes up a material part of the tenants' rental payments. 1040 ez 2010 pdf   Examples of services that are not normally provided for the tenants' convenience include supervising and maintaining a recreational hall provided by the park, distributing a monthly newsletter to tenants, operating a laundry facility, and helping tenants buy or sell their trailers. 1040 ez 2010 pdf   Examples of services that are normally provided to maintain the lots in a condition for tenant occupancy include city sewerage, electrical connections, and roadways. 1040 ez 2010 pdf Hotels, boarding houses, and apartments. 1040 ez 2010 pdf   Rental income you receive for the use or occupancy of hotels, boarding houses, or apartment houses is subject to SE tax if you provide services for the occupants. 1040 ez 2010 pdf   Generally, you are considered to provide services for the occupants if the services are primarily for their convenience and are not services normally provided with the rental of rooms for occupancy only. 1040 ez 2010 pdf An example of a service that is not normally provided for the convenience of the occupants is maid service. 1040 ez 2010 pdf However, providing heat and light, cleaning stairways and lobbies, and collecting trash are services normally provided for the occupants' convenience. 1040 ez 2010 pdf Prepaid rent. 1040 ez 2010 pdf   Advance payments received under a lease that does not put any restriction on their use or enjoyment are income in the year you receive them. 1040 ez 2010 pdf This is true no matter what accounting method or period you use. 1040 ez 2010 pdf Lease bonus. 1040 ez 2010 pdf   A bonus you receive from a lessee for granting a lease is an addition to the rent. 1040 ez 2010 pdf Include it in your gross receipts in the year received. 1040 ez 2010 pdf Lease cancellation payments. 1040 ez 2010 pdf   Report payments you receive from your lessee for canceling a lease in your gross receipts in the year received. 1040 ez 2010 pdf Payments to third parties. 1040 ez 2010 pdf   If your lessee makes payments to someone else under an agreement to pay your debts or obligations, include the payments in your gross receipts when the lessee makes the payments. 1040 ez 2010 pdf A common example of this kind of income is a lessee's payment of your property taxes on leased real property. 1040 ez 2010 pdf Settlement payments. 1040 ez 2010 pdf   Payments you receive in settlement of a lessee's obligation to restore the leased property to its original condition are income in the amount that the payments exceed the adjusted basis of the leasehold improvements destroyed, damaged, removed, or disconnected by the lessee. 1040 ez 2010 pdf Personal Property Rents If you are in the business of renting personal property (equipment, vehicles, formal wear, etc. 1040 ez 2010 pdf ), include the rental amount you receive in your gross receipts on Schedule C or C-EZ. 1040 ez 2010 pdf Prepaid rent and other payments described in the preceding Real Estate Rents discussion can also be received for renting personal property. 1040 ez 2010 pdf If you receive any of those payments, include them in your gross receipts as explained in that discussion. 1040 ez 2010 pdf Interest and Dividend Income Interest and dividends may be considered business income. 1040 ez 2010 pdf Interest. 1040 ez 2010 pdf   Interest received on notes receivable that you have accepted in the ordinary course of business is business income. 1040 ez 2010 pdf Interest received on loans is business income if you are in the business of lending money. 1040 ez 2010 pdf Uncollectible loans. 1040 ez 2010 pdf   If a loan payable to you becomes uncollectible during the tax year and you use an accrual method of accounting, you must include in gross income interest accrued up to the time the loan became uncollectible. 1040 ez 2010 pdf If the accrued interest later becomes uncollectible, you may be able to take a bad debt deduction. 1040 ez 2010 pdf See Bad Debts in chapter 8. 1040 ez 2010 pdf Unstated interest. 1040 ez 2010 pdf   If little or no interest is charged on an installment sale, you may have to treat a part of each payment as unstated interest. 1040 ez 2010 pdf See Unstated Interest and Original Issue Discount (OID) in Publication 537, Installment Sales. 1040 ez 2010 pdf Dividends. 1040 ez 2010 pdf   Generally, dividends are business income to dealers in securities. 1040 ez 2010 pdf For most sole proprietors and statutory employees, however, dividends are nonbusiness income. 1040 ez 2010 pdf If you hold stock as a personal investment separately from your business activity, the dividends from the stock are nonbusiness income. 1040 ez 2010 pdf   If you receive dividends from business insurance premiums you deducted in an earlier year, you must report all or part of the dividend as business income on your return. 1040 ez 2010 pdf To find out how much you have to report, see   Recovery of items previously deducted under Other Income, later. 1040 ez 2010 pdf Canceled Debt The following explains the general rule for including canceled debt in income and the exceptions to the general rule. 1040 ez 2010 pdf General Rule Generally, if your debt is canceled or forgiven, other than as a gift or bequest to you, you must include the canceled amount in your gross income for tax purposes. 1040 ez 2010 pdf Report the canceled amount on line 6 of Schedule C if you incurred the debt in your business. 1040 ez 2010 pdf If the debt is a nonbusiness debt, report the canceled amount on line 21 of Form 1040. 1040 ez 2010 pdf Exceptions The following discussion covers some exceptions to the general rule for canceled debt. 1040 ez 2010 pdf Price reduced after purchase. 1040 ez 2010 pdf   If you owe a debt to the seller for property you bought and the seller reduces the amount you owe, you generally do not have income from the reduction. 1040 ez 2010 pdf Unless you are bankrupt or insolvent, treat the amount of the reduction as a purchase price adjustment and reduce your basis in the property. 1040 ez 2010 pdf Deductible debt. 1040 ez 2010 pdf   You do not realize income from a canceled debt to the extent the payment of the debt would have led to a deduction. 1040 ez 2010 pdf Example. 1040 ez 2010 pdf You get accounting services for your business on credit. 1040 ez 2010 pdf Later, you have trouble paying your business debts, but you are not bankrupt or insolvent. 1040 ez 2010 pdf Your accountant forgives part of the amount you owe for the accounting services. 1040 ez 2010 pdf How you treat the canceled debt depends on your method of accounting. 1040 ez 2010 pdf Cash method — You do not include the canceled debt in income because payment of the debt would have been deductible as a business expense. 1040 ez 2010 pdf Accrual method — You include the canceled debt in income because the expense was deductible when you incurred the debt. 1040 ez 2010 pdf   For information on the cash and accrual methods of accounting, see chapter 2. 1040 ez 2010 pdf Exclusions Do not include canceled debt in income in the following situations. 1040 ez 2010 pdf However, you may be required to file Form 982, Reduction of Tax Attributes Due to Discharge of Indebtedness. 1040 ez 2010 pdf For more information, see Form 982. 1040 ez 2010 pdf The cancellation takes place in a bankruptcy case under title 11 of the U. 1040 ez 2010 pdf S. 1040 ez 2010 pdf Code (relating to bankruptcy). 1040 ez 2010 pdf See Publication 908, Bankruptcy Tax Guide. 1040 ez 2010 pdf The cancellation takes place when you are insolvent. 1040 ez 2010 pdf You can exclude the canceled debt to the extent you are insolvent. 1040 ez 2010 pdf See Publication 908. 1040 ez 2010 pdf The canceled debt is a qualified farm debt owed to a qualified person. 1040 ez 2010 pdf See chapter 3 in Publication 225, Farmer's Tax Guide. 1040 ez 2010 pdf The canceled debt is a qualified real property business debt. 1040 ez 2010 pdf This situation is explained later. 1040 ez 2010 pdf The canceled debt is qualified principal residence indebtedness which is discharged after 2006. 1040 ez 2010 pdf See Form 982. 1040 ez 2010 pdf If a canceled debt is excluded from income because it takes place in a bankruptcy case, the exclusions in situations 2 through 5 do not apply. 1040 ez 2010 pdf If it takes place when you are insolvent, the exclusions in situations 3 and 4 do not apply to the extent you are insolvent. 1040 ez 2010 pdf Debt. 1040 ez 2010 pdf   For purposes of this discussion, debt includes any debt for which you are liable or which attaches to property you hold. 1040 ez 2010 pdf Qualified real property business debt. 1040 ez 2010 pdf   You can elect to exclude (up to certain limits) the cancellation of qualified real property business debt. 1040 ez 2010 pdf If you make the election, you must reduce the basis of your depreciable real property by the amount excluded. 1040 ez 2010 pdf Make this reduction at the beginning of your tax year following the tax year in which the cancellation occurs. 1040 ez 2010 pdf However, if you dispose of the property before that time, you must reduce its basis immediately before the disposition. 1040 ez 2010 pdf Cancellation of qualified real property business debt. 1040 ez 2010 pdf   Qualified real property business debt is debt (other than qualified farm debt) that meets all the following conditions. 1040 ez 2010 pdf It was incurred or assumed in connection with real property used in a trade or business. 1040 ez 2010 pdf It was secured by such real property. 1040 ez 2010 pdf It was incurred or assumed at either of the following times. 1040 ez 2010 pdf Before January 1, 1993. 1040 ez 2010 pdf After December 31, 1992, if incurred or assumed to acquire, construct, or substantially improve the real property. 1040 ez 2010 pdf It is debt to which you choose to apply these rules. 1040 ez 2010 pdf   Qualified real property business debt includes refinancing of debt described in (3) earlier, but only to the extent it does not exceed the debt being refinanced. 1040 ez 2010 pdf   You cannot exclude more than either of the following amounts. 1040 ez 2010 pdf The excess (if any) of: The outstanding principal of qualified real property business debt (immediately before the cancellation), over The fair market value (immediately before the cancellation) of the business real property that is security for the debt, reduced by the outstanding principal amount of any other qualified real property business debt secured by this property immediately before the cancellation. 1040 ez 2010 pdf The total adjusted bases of depreciable real property held by you immediately before the cancellation. 1040 ez 2010 pdf These adjusted bases are determined after any basis reduction due to a cancellation in bankruptcy, insolvency, or of qualified farm debt. 1040 ez 2010 pdf Do not take into account depreciable real property acquired in contemplation of the cancellation. 1040 ez 2010 pdf Election. 1040 ez 2010 pdf   To make this election, complete Form 982 and attach it to your income tax return for the tax year in which the cancellation occurs. 1040 ez 2010 pdf You must file your return by the due date (including extensions). 1040 ez 2010 pdf If you timely filed your return for the year without making the election, you can still make the election by filing an amended return within 6 months of the due date of the return (excluding extensions). 1040 ez 2010 pdf For more information, see When To File in the form instructions. 1040 ez 2010 pdf Other Income The following discussion explains how to treat other types of business income you may receive. 1040 ez 2010 pdf Restricted property. 1040 ez 2010 pdf   Restricted property is property that has certain restrictions that affect its value. 1040 ez 2010 pdf If you receive restricted stock or other property for services performed, the fair market value of the property in excess of your cost is included in your income on Schedule C or C-EZ when the restriction is lifted. 1040 ez 2010 pdf However, you can choose to be taxed in the year you receive the property. 1040 ez 2010 pdf For more information on including restricted property in income, see Publication 525, Taxable and Nontaxable Income. 1040 ez 2010 pdf Gains and losses. 1040 ez 2010 pdf   Do not report on Schedule C or C-EZ a gain or loss from the disposition of property that is neither stock in trade nor held primarily for sale to customers. 1040 ez 2010 pdf Instead, you must report these gains and losses on other forms. 1040 ez 2010 pdf For more information, see chapter 3. 1040 ez 2010 pdf Promissory notes. 1040 ez 2010 pdf   Report promissory notes and other evidences of debt issued to you in a sale or exchange of property that is stock in trade or held primarily for sale to customers on Schedule C or C-EZ. 1040 ez 2010 pdf In general, you report them at their stated principal amount (minus any unstated interest) when you receive them. 1040 ez 2010 pdf Lost income payments. 1040 ez 2010 pdf   If you reduce or stop your business activities, report on Schedule C or C-EZ any payment you receive for the lost income of your business from insurance or other sources. 1040 ez 2010 pdf Report it on Schedule C or C-EZ even if your business is inactive when you receive the payment. 1040 ez 2010 pdf Damages. 1040 ez 2010 pdf   You must include in gross income compensation you receive during the tax year as a result of any of the following injuries connected with your business. 1040 ez 2010 pdf Patent infringement. 1040 ez 2010 pdf Breach of contract or fiduciary duty. 1040 ez 2010 pdf Antitrust injury. 1040 ez 2010 pdf Economic injury. 1040 ez 2010 pdf   You may be entitled to a deduction against the income if it compensates you for actual economic injury. 1040 ez 2010 pdf Your deduction is the smaller of the following amounts. 1040 ez 2010 pdf The amount you receive or accrue for damages in the tax year reduced by the amount you pay or incur in the tax year to recover that amount. 1040 ez 2010 pdf Your loss from the injury that you have not yet deducted. 1040 ez 2010 pdf Punitive damages. 1040 ez 2010 pdf   You must also include punitive damages in income. 1040 ez 2010 pdf Kickbacks. 1040 ez 2010 pdf   If you receive any kickbacks, include them in your income on Schedule C or C-EZ. 1040 ez 2010 pdf However, do not include them if you properly treat them as a reduction of a related expense item, a capital expenditure, or cost of goods sold. 1040 ez 2010 pdf Recovery of items previously deducted. 1040 ez 2010 pdf   If you recover a bad debt or any other item deducted in a previous year, include the recovery in income on Schedule C or C-EZ. 1040 ez 2010 pdf However, if all or part of the deduction in earlier years did not reduce your tax, you can exclude the part that did not reduce your tax. 1040 ez 2010 pdf If you exclude part of the recovery from income, you must include with your return a computation showing how you figured the exclusion. 1040 ez 2010 pdf Example. 1040 ez 2010 pdf Joe Smith, a sole proprietor, had gross income of $8,000, a bad debt deduction of $300, and other allowable deductions of $7,700. 1040 ez 2010 pdf He also had 2 personal exemptions for a total of $7,800. 1040 ez 2010 pdf He would not pay income tax even if he did not deduct the bad debt. 1040 ez 2010 pdf Therefore, he will not report as income any part of the $300 he may recover in any future year. 1040 ez 2010 pdf Exception for depreciation. 1040 ez 2010 pdf   This rule does not apply to depreciation. 1040 ez 2010 pdf You recover depreciation using the rules explained next. 1040 ez 2010 pdf Recapture of depreciation. 1040 ez 2010 pdf   In the following situations, you have to recapture the depreciation deduction. 1040 ez 2010 pdf This means you include in income part or all of the depreciation you deducted in previous years. 1040 ez 2010 pdf Listed property. 1040 ez 2010 pdf   If your business use of listed property (explained in chapter 8 under Depreciation ) falls to 50% or less in a tax year after the tax year you placed the property in service, you may have to recapture part of the depreciation deduction. 1040 ez 2010 pdf You do this by including in income on Schedule C part of the depreciation you deducted in previous years. 1040 ez 2010 pdf Use Part IV of Form 4797, Sales of Business Property, to figure the amount to include on Schedule C. 1040 ez 2010 pdf For more information, see What is the Business-Use Requirement? in chapter 5 of Publication 946, How To Depreciate Property. 1040 ez 2010 pdf That chapter explains how to determine whether property is used more than 50% in your business. 1040 ez 2010 pdf Section 179 property. 1040 ez 2010 pdf   If you take a section 179 deduction (explained in chapter 8 under Depreciation ) for an asset and before the end of the asset's recovery period the percentage of business use drops to 50% or less, you must recapture part of the section 179 deduction. 1040 ez 2010 pdf You do this by including in income on Schedule C part of the deduction you took. 1040 ez 2010 pdf Use Part IV of Form 4797 to figure the amount to include on Schedule C. 1040 ez 2010 pdf See chapter 2 in Publication 946 to find out when you recapture the deduction. 1040 ez 2010 pdf Sale or exchange of depreciable property. 1040 ez 2010 pdf   If you sell or exchange depreciable property at a gain, you may have to treat all or part of the gain due to depreciation as ordinary income. 1040 ez 2010 pdf You figure the income due to depreciation recapture in Part III of Form 4797. 1040 ez 2010 pdf For more information, see chapter 4 in Publication 544, Sales and Other Dispositions of Assets. 1040 ez 2010 pdf Items That Are Not Income In some cases the property or money you receive is not income. 1040 ez 2010 pdf Appreciation. 1040 ez 2010 pdf   Increases in value of your property are not income until you realize the increases through a sale or other taxable disposition. 1040 ez 2010 pdf Consignments. 1040 ez 2010 pdf   Consignments of merchandise to others to sell for you are not sales. 1040 ez 2010 pdf The title of merchandise remains with you, the consignor, even after the consignee possesses the merchandise. 1040 ez 2010 pdf Therefore, if you ship goods on consignment, you have no profit or loss until the consignee sells the merchandise. 1040 ez 2010 pdf Merchandise you have shipped out on consignment is included in your inventory until it is sold. 1040 ez 2010 pdf   Do not include merchandise you receive on consignment in your inventory. 1040 ez 2010 pdf Include your profit or commission on merchandise consigned to you in your income when you sell the merchandise or when you receive your profit or commission, depending upon the method of accounting you use. 1040 ez 2010 pdf Construction allowances. 1040 ez 2010 pdf   If you enter into a lease after August 5, 1997, you can exclude from income the construction allowance you receive (in cash or as a rent reduction) from your landlord if you receive it under both the following conditions. 1040 ez 2010 pdf Under a short-term lease of retail space. 1040 ez 2010 pdf For the purpose of constructing or improving qualified long-term real property for use in your business at that retail space. 1040 ez 2010 pdf Amount you can exclude. 1040 ez 2010 pdf   You can exclude the construction allowance to the extent it does not exceed the amount you spent for construction or improvements. 1040 ez 2010 pdf Short-term lease. 1040 ez 2010 pdf   A short-term lease is a lease (or other agreement for occupancy or use) of retail space for 15 years or less. 1040 ez 2010 pdf The following rules apply in determining whether the lease is for 15 years or less. 1040 ez 2010 pdf Take into account options to renew when figuring whether the lease is for 15 years or less. 1040 ez 2010 pdf But do not take into account any option to renew at fair market value determined at the time of renewal. 1040 ez 2010 pdf Two or more successive leases that are part of the same transaction (or a series of related transactions) for the same or substantially similar retail space are treated as one lease. 1040 ez 2010 pdf Retail space. 1040 ez 2010 pdf   Retail space is real property leased, occupied, or otherwise used by you as a tenant in your business of selling tangible personal property or services to the general public. 1040 ez 2010 pdf Qualified long-term real property. 1040 ez 2010 pdf   Qualified long-term real property is nonresidential real property that is part of, or otherwise present at, your retail space and that reverts to the landlord when the lease ends. 1040 ez 2010 pdf Exchange of like-kind property. 1040 ez 2010 pdf   If you exchange your business property or property you hold for investment solely for property of a like kind to be used in your business or to be held for investment, no gain or loss is recognized. 1040 ez 2010 pdf This means that the gain is not taxable and the loss is not deductible. 1040 ez 2010 pdf A common type of nontaxable exchange is the trade-in of a business automobile for another business automobile. 1040 ez 2010 pdf For more information, see Form 8824. 1040 ez 2010 pdf Leasehold improvements. 1040 ez 2010 pdf   If a tenant erects buildings or makes improvements to your property, the increase in the value of the property due to the improvements is not income to you. 1040 ez 2010 pdf However, if the facts indicate that the improvements are a payment of rent to you, then the increase in value would be income. 1040 ez 2010 pdf Loans. 1040 ez 2010 pdf   Money borrowed through a bona fide loan is not income. 1040 ez 2010 pdf Sales tax. 1040 ez 2010 pdf   State and local sales taxes imposed on the buyer, which you were required to collect and pay over to state or local governments, are not income. 1040 ez 2010 pdf Guidelines for Selected Occupations This section provides information to determine whether your earnings should be reported on Schedule C (Form 1040) or C-EZ (Form 1040). 1040 ez 2010 pdf Direct seller. 1040 ez 2010 pdf   You must report all income you receive as a direct seller on Schedule C or C-EZ. 1040 ez 2010 pdf This includes any of the following. 1040 ez 2010 pdf Income from sales—payments you receive from customers for products they buy from you. 1040 ez 2010 pdf Commissions, bonuses, or percentages you receive for sales and the sales of others who work under you. 1040 ez 2010 pdf Prizes, awards, and gifts you receive from your selling business. 1040 ez 2010 pdf You must report this income regardless of whether it is reported to you on an information return. 1040 ez 2010 pdf   You are a direct seller if you meet all the following conditions. 1040 ez 2010 pdf You are engaged in one of the following trades or businesses. 1040 ez 2010 pdf Selling or soliciting the sale of consumer products either in a home or other place that is not a permanent retail establishment, or to any buyer on a buy-sell basis or a deposit-commission basis for resale in a home or other place of business that is not a permanent retail establishment. 1040 ez 2010 pdf Delivering or distributing newspapers or shopping news (including any services directly related to that trade or business). 1040 ez 2010 pdf Substantially all your pay (whether paid in cash or not) for services described above is directly related to sales or other output (including performance of services) rather than to the number of hours worked. 1040 ez 2010 pdf Your services are performed under a written contract between you and the person for whom you perform the services, and the contract provides that you will not be treated as an employee for federal tax purposes. 1040 ez 2010 pdf Executor or administrator. 1040 ez 2010 pdf   If you administer a deceased person's estate, your fees are reported on Schedule C or C-EZ if you are one of the following: A professional fiduciary. 1040 ez 2010 pdf A nonprofessional fiduciary (personal representative) and both of the following apply. 1040 ez 2010 pdf The estate includes an active trade or business in which you actively participate. 1040 ez 2010 pdf Your fees are related to the operation of that trade or business. 1040 ez 2010 pdf A nonprofessional fiduciary of a single estate that requires extensive managerial activities on your part for a long period of time, provided these activities are enough to be considered a trade or business. 1040 ez 2010 pdf    If the fees do not meet the above requirements, report them on line 21 of Form 1040. 1040 ez 2010 pdf Fishing crew member. 1040 ez 2010 pdf    If you are a member of the crew that catches fish or other water life, your earnings are reported on Schedule C or C-EZ if you meet all the requirements shown in chapter 10 under Fishing crew member . 1040 ez 2010 pdf Insurance agent, former. 1040 ez 2010 pdf   Termination payments you receive as a former self-employed insurance agent from an insurance company because of services you performed for that company are not reported on Schedule C or C-EZ if all the following conditions are met. 1040 ez 2010 pdf You received payments after your agreement to perform services for the company ended. 1040 ez 2010 pdf You did not perform any services for the company after your service agreement ended and before the end of the year in which you received the payment. 1040 ez 2010 pdf You entered into a covenant not to compete against the company for at least a 1-year period beginning on the date your service agreement ended. 1040 ez 2010 pdf The amount of the payments depended primarily on policies sold by you or credited to your account during the last year of your service agreement or the extent to which those policies remain in force for some period after your service agreement ended, or both. 1040 ez 2010 pdf The amount of the payment did not depend to any extent on length of service or overall earnings from services performed for the company (regardless of whether eligibility for the payments depended on length of service). 1040 ez 2010 pdf Insurance agent, retired. 1040 ez 2010 pdf   Income paid by an insurance company to a retired self-employed insurance agent based on a percentage of commissions received before retirement is reported on Schedule C or C-EZ. 1040 ez 2010 pdf Also, renewal commissions and deferred commissions for sales made before retirement are generally reported on Schedule C or C-EZ. 1040 ez 2010 pdf   However, renewal commissions paid to the survivor of an insurance agent are not reported on Schedule C or C-EZ. 1040 ez 2010 pdf Newspaper carrier or distributor. 1040 ez 2010 pdf   You are a direct seller and your earnings are reported on Schedule C or C-EZ if all the following conditions apply. 1040 ez 2010 pdf You are in the business of delivering or distributing newspapers or shopping news (including directly related services such as soliciting customers and collecting receipts). 1040 ez 2010 pdf Substantially all your pay for these services directly relates to your sales or other output rather than to the number of hours you work. 1040 ez 2010 pdf You perform the services under a written contract that says you will not be treated as an employee for federal tax purposes. 1040 ez 2010 pdf   This rule applies whether or not you hire others to help you make deliveries. 1040 ez 2010 pdf It also applies whether you buy the papers from the publisher or are paid based on the number of papers you deliver. 1040 ez 2010 pdf Newspaper or magazine vendor. 1040 ez 2010 pdf   If you are 18 or older and you sell newspapers or magazines, your earnings are reported on Schedule C or C-EZ if all the following conditions apply. 1040 ez 2010 pdf You sell newspapers or magazines to ultimate consumers. 1040 ez 2010 pdf You sell them at a fixed price. 1040 ez 2010 pdf Your earnings are based on the difference between the sales price and your cost of goods sold. 1040 ez 2010 pdf   This rule applies whether or not you are guaranteed a minimum amount of earnings. 1040 ez 2010 pdf It also applies whether or not you receive credit for unsold newspapers or magazines you return to your supplier. 1040 ez 2010 pdf Notary public. 1040 ez 2010 pdf   Fees you receive for services you perform as a notary public are reported on Schedule C or C-EZ. 1040 ez 2010 pdf These payments are not subject to self-employment tax (see the instructions for Schedule SE (Form 1040)). 1040 ez 2010 pdf Public official. 1040 ez 2010 pdf   Public officials generally do not report what they earn for serving in public office on Schedule C or C-EZ. 1040 ez 2010 pdf This rule applies to payments received by an elected tax collector from state funds on the basis of a fixed percentage of the taxes collected. 1040 ez 2010 pdf Public office includes any elective or appointive office of the United States or its possessions, the District of Columbia, a state or its political subdivisions, or a wholly owned instrumentality of any of these. 1040 ez 2010 pdf   Public officials of state or local governments report their fees on Schedule C or C-EZ if they are paid solely on a fee basis and if their services are eligible for, but not covered by, social security under a federal-state agreement. 1040 ez 2010 pdf Real estate agent or direct seller. 1040 ez 2010 pdf   If you are a licensed real estate agent or a direct seller, your earnings are reported on Schedule C or C-EZ if both the following apply. 1040 ez 2010 pdf Substantially all your pay for services as a real estate agent or direct seller directly relates to your sales or other output rather than to the number of hours you work. 1040 ez 2010 pdf You perform the services under a written contract that says you will not be treated as an employee for federal tax purposes. 1040 ez 2010 pdf Securities dealer. 1040 ez 2010 pdf   If you are a dealer in options or commodities, your gains and losses from dealing or trading in section 1256 contracts (regulated futures contracts, foreign currency contracts, nonequity options, dealer equity options, and dealer securities futures contracts) or property related to those contracts (such as stock used to hedge options) are reported on Schedule C or C-EZ. 1040 ez 2010 pdf For more information, see sections 1256 and 1402(i). 1040 ez 2010 pdf Securities trader. 1040 ez 2010 pdf   You are a trader in securities if you are engaged in the business of buying and selling securities for your own account. 1040 ez 2010 pdf As a trader in securities, your gain or loss from the disposition of securities is not reported on Schedule C or C-EZ. 1040 ez 2010 pdf However, see Securities dealer , earlier, for an exception that applies to section 1256 contracts. 1040 ez 2010 pdf For more information about securities traders, see Publication 550, Investment Income and Expenses. 1040 ez 2010 pdf Accounting for Your Income Accounting for your income for income tax purposes differs at times from accounting for financial purposes. 1040 ez 2010 pdf This section discusses some of the more common differences that may affect business transactions. 1040 ez 2010 pdf Figure your business income on the basis of a tax year and according to your regular method of accounting (see chapter 2). 1040 ez 2010 pdf If the sale of a product is an income-producing factor in your business, you usually have to use inventories to clearly show your income. 1040 ez 2010 pdf Dealers in real estate are not allowed to use inventories. 1040 ez 2010 pdf For more information on inventories, see chapter 2. 1040 ez 2010 pdf Income paid to a third party. 1040 ez 2010 pdf   All income you earn is taxable to you. 1040 ez 2010 pdf You cannot avoid tax by having the income paid to a third party. 1040 ez 2010 pdf Example. 1040 ez 2010 pdf You rent out your property and the rental agreement directs the lessee to pay the rent to your son. 1040 ez 2010 pdf The amount paid to your son is gross income to you. 1040 ez 2010 pdf Cash discounts. 1040 ez 2010 pdf   These are amounts the seller permits you to deduct from the invoice price for prompt payment. 1040 ez 2010 pdf For income tax purposes, you can use either of the following two methods to account for cash discounts. 1040 ez 2010 pdf Deduct the cash discount from purchases (see Line 36, Purchases Less Cost of Items Withdrawn for Personal Use in chapter 6). 1040 ez 2010 pdf Credit the cash discount to a discount income account. 1040 ez 2010 pdf You must use the chosen method every year for all your purchase discounts. 1040 ez 2010 pdf   If you use the second method, the credit balance in the account at the end of your tax year is business income. 1040 ez 2010 pdf Under this method, you do not reduce the cost of goods sold by the cash discounts you received. 1040 ez 2010 pdf When valuing your closing inventory, you cannot reduce the invoice price of merchandise on hand at the close of the tax year by the average or estimated discounts received on the merchandise. 1040 ez 2010 pdf Trade discounts. 1040 ez 2010 pdf   These are reductions from list or catalog prices and usually are not written into the invoice or charged to the customer. 1040 ez 2010 pdf Do not enter these discounts on your books of account. 1040 ez 2010 pdf Instead, use only the net amount as the cost of the merchandise purchased. 1040 ez 2010 pdf For more information, see Trade discounts in chapter 6. 1040 ez 2010 pdf Payment placed in escrow. 1040 ez 2010 pdf   If the buyer of your property places part or all of the purchase price in escrow, you do not include any part of it in gross sales until you actually or constructively receive it. 1040 ez 2010 pdf However, upon completion of the terms of the contract and the escrow agreement, you will have taxable income, even if you do not accept the money until the next year. 1040 ez 2010 pdf Sales returns and allowances. 1040 ez 2010 pdf   Credits you allow customers for returned merchandise and any other allowances you make on sales are deductions from gross sales in figuring net sales. 1040 ez 2010 pdf Advance payments. 1040 ez 2010 pdf   Special rules dealing with an accrual method of accounting for payments received in advance are discussed in chapter 2 under Accrual Method. 1040 ez 2010 pdf Insurance proceeds. 1040 ez 2010 pdf   If you receive insurance or another type of reimbursement for a casualty or theft loss, you must subtract it from the loss when you figure your deduction. 1040 ez 2010 pdf You cannot deduct the reimbursed part of a casualty or theft loss. 1040 ez 2010 pdf   For information on casualty or theft losses, see Publication 547, Casualties, Disasters, and Thefts. 1040 ez 2010 pdf Prev  Up  Next   Home   More Online Publications