File your Taxes for Free!
  • Get your maximum refund*
  • 100% accurate calculations guaranteed*

TurboTax Federal Free Edition - File Taxes Online

Don't let filing your taxes get you down! We'll help make it as easy as possible. With e-file and direct deposit, there's no faster way to get your refund!

Approved TurboTax Affiliate Site. TurboTax and TurboTax Online, among others, are registered trademarks and/or service marks of Intuit Inc. in the United States and other countries. Other parties' trademarks or service marks are the property of the respective owners.


© 2012 - 2018 All rights reserved.

This is an Approved TurboTax Affiliate site. TurboTax and TurboTax Online, among other are registered trademarks and/or service marks of Intuit, Inc. in the United States and other countries. Other parties' trademarks or service marks are the property of the respective owners.
When discussing "Free e-file", note that state e-file is an additional fee. E-file fees do not apply to New York state returns. Prices are subject to change without notice. E-file and get your refund faster
*If you pay an IRS or state penalty or interest because of a TurboTax calculations error, we'll pay you the penalty and interest.
*Maximum Refund Guarantee - or Your Money Back: If you get a larger refund or smaller tax due from another tax preparation method, we'll refund the applicable TurboTax federal and/or state purchase price paid. TurboTax Federal Free Edition customers are entitled to payment of $14.99 and a refund of your state purchase price paid. Claims must be submitted within sixty (60) days of your TurboTax filing date and no later than 6/15/14. E-file, Audit Defense, Professional Review, Refund Transfer and technical support fees are excluded. This guarantee cannot be combined with the TurboTax Satisfaction (Easy) Guarantee. *We're so confident your return will be done right, we guarantee it. Accurate calculations guaranteed. If you pay an IRS or state penalty or interest because of a TurboTax calculations error, we'll pay you the penalty and interest.
https://turbotax.intuit.com/corp/guarantees.jsp

1040ez 2011

Taxact.com 2012Taxslayer 2011 Tax Return2013 Tax Forms 1040ezTaxact 2011 Download FreeWho Can Use 1040ez FormFile Taxes Online FreeFile My 2012 Taxes Online FreeFiling 1040nrez1040ez Worksheet Line F1040ez Form For 2013Free State FilingHow To File Back TaxesAmend Tax Return2012 Tax Forms 10401040ez Tax FormsNeed To File 2010 TaxesHow Do I File Taxes For 2010Www H & R BlockOnline 1040ez1040ez Instruction Book2012 1040xFiling State Income Tax ReturnEz Form 2012Free Efile Of State TaxesE File 1040xDo Students Have To File Taxes2012 Irs Form 1040ezWww Free State Taxes ComState Income Tax Form2012 H&r Block Tax SoftwarePast Year Tax FormsAmending Tax ReturnHow To Amend A Tax Return Using TurbotaxTax Form For Students1040ez Electronic FilingFree State Tax Preparation OnlineTurbotax Deluxe Federal E File 2012 For Pc DownloadFile State Taxes Online Free 2012File Free Federal And State Tax ReturnHr Block Online Free Tax Filing

1040ez 2011

1040ez 2011 18. 1040ez 2011   Appendix This appendix contains models of the certificates, waivers, reports, and statements discussed in Part One. 1040ez 2011 Model Certificate A   STATEMENT OF SUBSEQUENT SELLER     1. 1040ez 2011                 Name, address, and employer identification number of seller in subsequent sale             2. 1040ez 2011                 Name, address, and employer identification number of the buyer in subsequent sale             3. 1040ez 2011         Date and location of subsequent sale             4. 1040ez 2011         Volume and type of taxable fuel sold               The undersigned seller (“Seller”) has received the copy of the first taxpayer's report provided with this statement in     connection with Seller's purchase of the taxable fuel described in this statement. 1040ez 2011       Under penalties of perjury, Seller declares that Seller has examined this statement, including any accompanying     schedules and statements, and, to the best of Seller's knowledge and belief, they are true, correct and complete. 1040ez 2011                   Signature and date signed                   Printed or typed name of person signing this report                   Title—   Model Certificate B   FIRST TAXPAYER'S REPORT   1. 1040ez 2011                     First Taxpayer's name, address and employer identification number     2. 1040ez 2011                     Name, address, and employer identification number of the buyer of the taxable fuel subject to tax     3. 1040ez 2011           Date and location of removal, entry, or sale       4. 1040ez 2011           Volume and type of taxable fuel removed, entered or sold     5. 1040ez 2011 Check type of taxable event:         Removal from refinery         Entry into United States         Bulk transfer from terminal by unregistered position holder       Bulk transfer not received at an approved terminal       Sale within the bulk transfer/terminal system       Removal at the terminal rack         Removal or sale by the blender                   6. 1040ez 2011           Amount of federal excise tax paid on account of the removal, entry, or sale                   The undersigned taxpayer (“Taxpayer”) has not received, and will not claim, a credit with respect to, or a refund of, the tax     on the taxable fuel to which this form relates. 1040ez 2011       Under penalties of perjury, Taxpayer declares that Taxpayer has examined this statement, including any accompanying     schedules and statements, and to the best of Taxpayer's knowledge and belief, they are true, correct and complete. 1040ez 2011             Signature and date signed               Printed or typed name of person signing this report               Title     Model Certificate C   NOTIFICATION CERTIFICATE OF TAXABLE FUEL REGISTRANT                           Name, address, and employer identification number of person receiving certificate       The undersigned taxable registrant (“Registrant”) hereby certifies under penalties of perjury that Registrant is registered     by the Internal Revenue Service with registration number and that Registrant's registration has not     been revoked or suspended by the Internal Revenue Service. 1040ez 2011                 Registrant understands that the fraudulent use of this certificate may subject Registrant and all parties making such     fraudulent use of this certificate to a fine or imprisonment, or both, together with the costs of prosecution. 1040ez 2011                       Signature and date signed                         Printed or typed name of person signing                         Title of person signing                         Name of Registrant                         Employer identification number                         Address of Registrant     Model Certificate D   CERTIFICATE OF PERSON BUYING GASOLINE BLENDSTOCKS FOR USE OTHER THAN IN THE PRODUCTION OF FINISHED GASOLINE     (To support tax-free sales (other than LUST) under section 4081 of the Internal Revenue Code. 1040ez 2011 )                 Name, address, and employer identification number of seller       The undersigned buyer (“Buyer”) hereby certifies the following under penalties of perjury:       The gasoline blendstocks to which this certificate relates will not be used to produce finished gasoline. 1040ez 2011       This certificate applies to the following (complete as applicable):       If this is a single purchase certificate, check here and enter:     1. 1040ez 2011 Invoice or delivery ticket number       2. 1040ez 2011 (number of gallons) of(type of gasoline blendstocks)       If this is a certificate covering all purchases under a specified account or order number, check here and enter:     1. 1040ez 2011 Effective date       2. 1040ez 2011 Expiration date       (period not to exceed 1 year after the effective date)       3. 1040ez 2011 Type (or types) of gasoline blendstocks     4. 1040ez 2011 Buyer's account or order number         Buyer will not claim a credit or refund under section 6427(h) of the Internal Revenue Code for any gasoline blendstocks     covered by this certificate. 1040ez 2011         Buyer will provide a new certificate to the seller if any information in this certificate changes. 1040ez 2011       If Buyer resells the gasoline blendstocks to which this certificate relates, Buyer will be liable for tax unless Buyer obtains a     certificate from the purchaser stating that the gasoline blendstocks will not be used to produce finished gasoline and otherwise complies with the conditions of §48. 1040ez 2011 4081-4(b)(3) of the Manufacturers and Retailers Excise Tax Regulations. 1040ez 2011       Buyer understands that if Buyer violates the terms of this certificate, the Internal Revenue Service may withdraw Buyer's     right to provide a certificate. 1040ez 2011       Buyer has not been notified by the Internal Revenue Service that its right to provide a certificate has been withdrawn. 1040ez 2011     In addition, the Internal Revenue Service has not notified Buyer that the right to provide a certificate has been withdrawn from a purchaser to which Buyer sells gasoline blendstocks tax free. 1040ez 2011       Buyer understands that the fraudulent use of this certificate may subject Buyer and all parties making such fraudulent use     of this certificate to a fine or imprisonment, or both, together with the costs of prosecution. 1040ez 2011             Signature and date signed               Printed or typed name of person signing               Title of person signing               Name of Buyer               Employer identification number               Address of Buyer     Model Certificate G   CERTIFICATE OF REGISTERED FEEDSTOCK USER     (To support tax-free removals and entries (other than LUST) of kerosene under section 4082 of the Internal Revenue Code. 1040ez 2011 )         (Buyer) certifies the following under penalties of perjury:       Name of buyer         Buyer is a registered feedstock user with registration number . 1040ez 2011 Buyer's registration has not been revoked     or suspended. 1040ez 2011         The kerosene to which this certificate applies will be used by Buyer for a feedstock purpose. 1040ez 2011                 This certificate applies to percent of Buyer's purchases from (name, address, and employer     identification number of seller) as follows (complete as applicable):       1. 1040ez 2011 A single purchase on invoice or delivery ticket number . 1040ez 2011                 2. 1040ez 2011 All purchases between (effective date) and (expiration date) (period not to exceed     one year after the effective date) under account or order number(s) . 1040ez 2011 If this certificate applies only to Buyer's     purchases for certain locations, check here and list the locations. 1040ez 2011                                   If Buyer sells the kerosene to which this certificate relates, Buyer will be liable for tax on that sale. 1040ez 2011                 Buyer will provide a new certificate to the seller if any information in this certificate changes. 1040ez 2011                 If Buyer violates the terms of this certificate, the Internal Revenue Service may revoke the Buyer's registration. 1040ez 2011                 Buyer understands that the fraudulent use of this certificate may subject Buyer and all parties making any fraudulent use of     this certificate to a fine or imprisonment, or both, together with the costs of prosecution. 1040ez 2011             Printed or typed name of person signing               Title of person signing               Employer identification number               Address of Buyer               Signature and date signed     Model Certificate J   CERTIFICATE OF PERSON BUYING COMPRESSED NATURAL GAS (CNG) FOR A NONTAXABLE USE     (To support tax-free sales of CNG under section 4041 of the Internal Revenue Code. 1040ez 2011 )                                         Name, address, and employer identification number of seller                   (“Buyer”) certifies the following under penalties of perjury:     Name of buyer                     The CNG to which this certificate relates will be used in a nontaxable use. 1040ez 2011       This certificate applies to the following (complete as applicable):               If this is a single purchase certificate, check here and enter:       1. 1040ez 2011 Invoice or delivery ticket number       2. 1040ez 2011 (Gasoline gallon equivalents)       If this is a certificate covering all purchases under a specified account or order number, check here and enter:         1. 1040ez 2011 Effective date         2. 1040ez 2011 Expiration date         (period not to exceed 1 year after the effective date)         3. 1040ez 2011 Buyer's account or order number       Buyer will not claim a credit or refund under section 6427 of the Internal Revenue Code for any CNG to which this certificate relates. 1040ez 2011       Buyer will provide a new certificate to the seller if any information in this certificate changes. 1040ez 2011       Buyer understands that if Buyer violates the terms of this certificate, the Internal Revenue Service may withdraw Buyer's     right to provide a certificate. 1040ez 2011       Buyer has not been notified by the Internal Revenue Service that its right to provide a certificate has been withdrawn. 1040ez 2011     In addition, the Internal Revenue Service has not notified Buyer that the right to provide a certificate has been withdrawn     from a purchaser to which Buyer sells CNG tax free. 1040ez 2011       Buyer understands that the fraudulent use of this certificate may subject Buyer and all parties making any fraudulent use     of this certificate to a fine or imprisonment, or both, together with the costs of prosecution. 1040ez 2011             Printed or typed name of person signing               Title of person signing             Employer identification number               Address of Buyer               Signature and date signed     Model Certificate K   CERTIFICATE OF PERSON BUYING KEROSENE FOR USE IN AVIATION FOR     COMMERCIAL AVIATION OR NONTAXABLE USE     (To support operator liability for tax on removals of kerosene for use in aviation directly into the fuel tank of an aircraft in commercial aviation pursuant to § 4081 of the Internal Revenue Code or to support a tax rate of zero under § 4041(c) pursuant to §§4041(c) and 4082. 1040ez 2011 )           Name, address, and employer identification number of position holder       The undersigned aircraft operator (“Buyer”) hereby certifies the following under the penalties of perjury:       The kerosene for use in aviation to which this certificate relates is purchased (check one): for     use on a farm for farming purposes; for use in foreign trade (reciprocal benefits required for foreign registered airlines); for use in certain helicopter and fixed-wing air ambulance uses; for use other than as a fuel in the propulsion engine of an aircraft; for the exclusive use of a qualified blood collector organization; for the exclusive use of a nonprofit educational organization; for the exclusive use of a state; for use in an aircraft owned by an aircraft museum; for use in military aircraft; or for use in commercial aviation (other than foreign trade). 1040ez 2011       With respect to kerosene for use in aviation purchased after June 30, 2005, for use in commercial aviation     (other than foreign trade), Buyer's registration number is. 1040ez 2011 Buyer's registration has not been suspended or revoked by the Internal Revenue Service. 1040ez 2011       This certificate applies to the following (complete as applicable):     This is a single purchase certificate:       1. 1040ez 2011 Invoice or delivery ticket number       2. 1040ez 2011 Number of gallons     This is a certificate covering all purchases under a specified account or order number:       1. 1040ez 2011 Effective date       2. 1040ez 2011 Expiration date (period not to exceed 1 year after the effective date)       3. 1040ez 2011 Buyer's account number       Buyer agrees to provide the person liable for tax with a new certificate if any information in this certificate changes. 1040ez 2011       If the kerosene for use in aviation to which this certificate relates is being bought for use in commercial aviation     (other than foreign trade), Buyer is liable for tax on its use of the fuel and will pay that tax to the government. 1040ez 2011       If Buyer sells or uses the kerosene for use in aviation to which this certificate relates for a use other than the use     stated above, Buyer will be liable for tax. 1040ez 2011       Buyer understands that it must be prepared to establish by satisfactory evidence the purpose for which the     fuel purchased under this certificate was used. 1040ez 2011     Buyer has not been notified by the Internal Revenue Service that its right to provide a certificate has been withdrawn. 1040ez 2011     If Buyer violates the terms of this certificate, the Internal Revenue Service may withdraw Buyer's right to provide a certificate. 1040ez 2011       The fraudulent use of this certificate may subject Buyer and all parties making any fraudulent use of this certificate     to a fine or imprisonment, or both, together with the costs of prosecution. 1040ez 2011           Printed or typed name of person signing           Title of person signing           Name of Buyer           Employer identification number           Address of Buyer           Signature and date signed   Model Waiver L WAIVER FOR USE BY ULTIMATE PURCHASERS OF KEROSENE FOR CERTAIN USES IN AVIATION (To support vendor's claim for a credit or payment under § 6427(l)(4)(C)(i) of the Internal Revenue Code. 1040ez 2011 )               Name, Address, and Employer Identification Number of Ultimate Vendor     The undersigned ultimate purchaser (“Buyer”) hereby certifies the following under penalties of perjury:     A. 1040ez 2011 The kerosene to which this waiver relates is purchased for — (check one):       1. 1040ez 2011 □ Use on a farm for farming purposes,       2. 1040ez 2011 □ Use in foreign trade (reciprocal benefits required for foreign registered airlines),       3. 1040ez 2011 □ Use in certain helicopter and fixed-wing air ambulance uses,       4. 1040ez 2011 □ The exclusive use of a qualified blood collector organization,       5. 1040ez 2011 □ The exclusive use of a nonprofit educational organization,       6. 1040ez 2011 □ Use in an aircraft owned by an aircraft museum,       7. 1040ez 2011 □ Use in military aircraft, or       8. 1040ez 2011 □ Use in commercial aviation (other than foreign trade). 1040ez 2011     B. 1040ez 2011 This waiver applies to the following (complete as applicable):       This is a single purchase waiver:           1. 1040ez 2011 Invoice or delivery ticket number           2. 1040ez 2011 Number of gallons       This is a waiver covering all purchases under a specified account or order number:           1. 1040ez 2011 Effective date           2. 1040ez 2011 Expiration date (period not to exceed 1 year after the effective date)           3. 1040ez 2011 Buyer's account number       Buyer will provide a new waiver to the vendor if any information in this waiver changes. 1040ez 2011       If Buyer uses the kerosene for use in aviation to which this waiver relates for a use other than the use stated above, Buyer will be liable for tax. 1040ez 2011       Buyer understands that by signing this waiver, Buyer gives up its right to claim any credit or payment for the kerosene for use in aviation used in a nontaxable use. 1040ez 2011       Buyer acknowledges that it has not and will not claim any credit or payment for the kerosene for use in aviation to which this waiver relates. 1040ez 2011       Buyer understands that the fraudulent use of this waiver may subject Buyer and all parties making such fraudulent use of this waiver to a fine or imprisonment, or both, together with the costs of prosecution. 1040ez 2011           Printed or typed name of person signing           Title of person signing           Name of Buyer           Employer identification number           Address of Buyer           Signature and date signed   Model Certificate M   CERTIFICATE FOR STATE USE OR NONPROFIT EDUCATIONAL     ORGANIZATION USE     (To support vendor's claim for a credit or payment under § 6416(a)(4) of the Internal Revenue Code. 1040ez 2011 )                       Name, address, and employer identification number of ultimate vendor       The undersigned ultimate purchaser (“Buyer”) hereby certifies the following under the penalties of perjury:       Buyer will use the gasoline or aviation gasoline to which this certificate relates (check one):     For the exclusive use of a state or local government; or     For the exclusive use of a nonprofit educational organization. 1040ez 2011       This certificate applies to the following (complete as applicable):     This is a single purchase certificate:       1. 1040ez 2011 Invoice or delivery ticket number       2. 1040ez 2011 Number of gallons     This is a certificate covering all purchases under a specified account or order number:       1. 1040ez 2011 Effective date       2. 1040ez 2011 Expiration date (period not to exceed 1 year after the effective date)       3. 1040ez 2011 Buyer's account number       Buyer will provide a new certificate to the vendor if any information in this certificate changes. 1040ez 2011       Buyer understands that by signing this certificate, Buyer gives up its right to claim any credit or payment for the gasoline or aviation gasoline to which this certificate relates. 1040ez 2011       Buyer acknowledges that it has not and will not claim any credit or payment for the gasoline or aviation gasoline to which this certificate relates. 1040ez 2011       Buyer understands that the fraudulent use of this certificate may subject Buyer and all parties making such fraudulent use of this certificate to a fine or imprisonment, or both, together with the costs of prosecution. 1040ez 2011           Printed or typed name of person signing           Title of person signing           Name of Buyer           Employer identification number           Address of Buyer           Signature and date signed   Model Waiver N   WAIVER FOR USE BY ULTIMATE PURCHASERS OF DIESEL FUEL OR     KEROSENE USED IN INTERCITY BUS TRANSPORTATION     (To support vendor's claim for a credit or payment under § 6427 of the Internal Revenue Code. 1040ez 2011 )                       Name, address, and employer identification number of ultimate vendor       The undersigned ultimate purchaser (“Buyer”) hereby certifies the following under the penalties of perjury:       The diesel fuel or kerosene to which this waiver relates is purchased for use in intercity bus transportation. 1040ez 2011       This waiver applies to the following (complete as applicable):     This is a single purchase waiver:       1. 1040ez 2011 Invoice or delivery ticket number       2. 1040ez 2011 Number of gallons     This is a waiver covering all purchases under a specified account or order number:       1. 1040ez 2011 Effective date       2. 1040ez 2011 Expiration date (period not to exceed 1 year after the effective date)       3. 1040ez 2011 Buyer's account number       Buyer will provide a new waiver to the vendor if any information in this waiver changes. 1040ez 2011       If Buyer uses the diesel fuel or kerosene to which this waiver relates for a use other than in intercity bus transportation, Buyer will be liable for tax. 1040ez 2011       Buyer understands that by signing this waiver, Buyer gives up its right to claim any credit or payment for the diesel fuel or kerosene used in intercity bus transportation. 1040ez 2011       Buyer acknowledges that it has not and will not claim any credit or payment for the diesel fuel or kerosene to which this waiver relates. 1040ez 2011       Buyer understands that the fraudulent use of this waiver may subject Buyer and all parties making such fraudulent use of this waiver to a fine or imprisonment, or both, together with the costs of prosecution. 1040ez 2011           Printed or typed name of person signing           Title of person signing           Name of Buyer           Employer identification number           Address of Buyer           Signature and date signed   Model Certificate O   CERTIFICATE FOR BIODIESEL     Certificate Identification Number:     (To support a claim related to biodiesel or a biodiesel mixture under section 6426 of the Internal Revenue Code. 1040ez 2011 )     The undersigned biodiesel producer (“Producer”) hereby certifies the following under penalties of perjury:   1. 1040ez 2011             Producer's name, address, and employer identification number (EIN)   2. 1040ez 2011             Name, address, and EIN of person buying the biodiesel from Producer   3. 1040ez 2011       Date and location of sale to buyer   4. 1040ez 2011 This certificate applies to gallons of biodiesel. 1040ez 2011   5. 1040ez 2011 Producer certifies that the biodiesel to which this certificate relates is:       % Agri-biodiesel (derived solely from virgin oils)       % Biodiesel other than agri-biodiesel       This certificate applies to the following sale:       Invoice or delivery ticket number       Total number of gallons of biodiesel sold under that invoice or delivery ticket number (including biodiesel not covered by this certificate)       Total number of certificates issued for that invoice or delivery ticket number   6. 1040ez 2011             Name, address, and employer identification number of reseller to whom certificate is issued (only in the case of certificates reissued to a reseller after the return of the original certificate)   7. 1040ez 2011 Original Certificate Identification Number (only in the case of certificates reissued to a reseller after return of the original certificate). 1040ez 2011       Producer is registered as a biodiesel producer with registration number . 1040ez 2011  Producer's registration has not been suspended or revoked by the Internal Revenue Service. 1040ez 2011       Producer certifies that the biodiesel to which this certificate relates in monoalkyl esters of long chain fatty acids derived from plant or animal matter that meets the requirements of the American Society of Testing and Materials D6751 and the registration requirements for fuels and fuel additives established by EPA under section 211 of the Clean Air Act (42 U. 1040ez 2011 S. 1040ez 2011 C. 1040ez 2011 7545). 1040ez 2011       Producer understands that the fraudulent use of this certificate may subject Producer and all parties making any fraudulent use of this certificate to a fine or imprisonment, or both, together with the costs of prosecution. 1040ez 2011           Printed or typed name of person signing this certificate           Title of person signing           Signature and date signed   Model Certificate P CERTIFICATE OF STATE USE (To support vendor's claim for credit or payment under section 6427 of the Internal Revenue Code. 1040ez 2011 )               Name, Address, and Employer Identification Number of Vendor     The undersigned buyer (“Buyer”) hereby certifies the following under penalties of perjury:     A. 1040ez 2011 Buyer will use the diesel fuel or kerosene to which this certificate relates for the exclusive use of a state or local government, or the District of Columbia. 1040ez 2011     B. 1040ez 2011 This certificate applies to the following (complete as applicable):       1. 1040ez 2011   If this is a single purchase certificate, check here □ and enter:           a. 1040ez 2011 Invoice or delivery ticket number           b. 1040ez 2011 Number of gallons       2. 1040ez 2011   If this is a certificate covering all purchases under a specified account or order number, check here □  and enter:           a. 1040ez 2011 Effective date           b. 1040ez 2011 Expiration date   (period not to exceed 1 year after effective date)           c. 1040ez 2011 Buyer's account or order number     ▪ Buyer will provide a new certificate to the vendor if any information in this certificate changes. 1040ez 2011     ▪ If Buyer uses the diesel fuel or kerosene to which this certificate relates for a purpose other than stated in the certificate, Buyer will be liable for any tax. 1040ez 2011     ▪ Buyer acknowledges that it has not and will not claim any credit or payment for the diesel fuel or kerosene to which this certificate relates. 1040ez 2011     ▪ Buyer understands that the fraudulent use of this certificate may subject Buyer and all parties making such fraudulent use of this certificate to a fine or imprisonment, or both, together with the costs of prosecution. 1040ez 2011           Printed or typed name of person signing           Title of person signing           Name of Buyer           Employer identification number           Address of Buyer           Signature and date signed   Model Certificate Q CERTIFICATE OF ULTIMATE PURCHASER OF KEROSENE FOR USE IN NONEXEMPT, NONCOMMERCIAL AVIATION (To support vendor's claim for credit or payment under section 6427(l)(4)(C)(ii) of the Internal Revenue Code. 1040ez 2011 )               Name, Address, and Employer Identification Number of Ultimate Vendor     The undersigned ultimate purchaser (“Buyer”) hereby certifies the following under penalties of perjury:     A. 1040ez 2011 The kerosene to which this certificate relates is purchased for a nonexempt use in noncommercial aviation. 1040ez 2011     B. 1040ez 2011 This certificate applies to the following (complete as applicable):       1. 1040ez 2011   If this is a single purchase certificate, check here □ and enter:           a. 1040ez 2011 Invoice or delivery ticket number           b. 1040ez 2011 Number of gallons       2. 1040ez 2011   This is a certificate covering all purchases under a specified account or order number:           a. 1040ez 2011 Effective date           b. 1040ez 2011 Expiration date   (period not to exceed 1 year after effective date)           c. 1040ez 2011 Buyer's account number     ▪ Buyer will provide a new certificate to the vendor if any information in this certificate changes. 1040ez 2011     ▪ If Buyer uses the kerosene to which this certificate relates for a use other than the nontaxable use stated above, Buyer will be liable for tax. 1040ez 2011     ▪ Buyer understands that the fraudulent use of this certificate may subject Buyer and all parties making such fraudulent use of this certificate to a fine or imprisonment, or both, together with the costs of prosecution. 1040ez 2011           Printed or typed name of person signing           Title of person signing           Name of Buyer           Employer identification number           Address of Buyer           Signature and date signed   Model Certificate R CERTIFICATE OF BUYER OF TAXABLE FUEL FOR USE BY A STATE OR NONPROFIT EDUCATIONAL ORGANIZATION (To support credit card issuer's claim for credit, refund, or payment under section 6416(a)(4)(B) or section 6427(l)(5)(D) of the Internal Revenue Code. 1040ez 2011 )               Name, Address, and Employer Identification Number of Credit Card Issuer. 1040ez 2011     The undersigned ultimate purchaser (“Buyer”) hereby certifies the following under penalties of perjury:     A. 1040ez 2011 Buyer will use the taxable fuel to which this certificate relates for the exclusive use of a state; or     B. 1040ez 2011 Buyer will use the gasoline to which this certificate relates for the exclusive use of a nonprofit educational organization. 1040ez 2011     C. 1040ez 2011 This certificate applies to all purchases made with the credit card identified below during the period specified:           a. 1040ez 2011 Effective date of certificate           b. 1040ez 2011 Expiration date of certificate   (period not to exceed 2 years after effective date)           c. 1040ez 2011 Buyer's account number     ▪ Buyer will provide a new certificate to the credit card issuer if any information in this certificate changes. 1040ez 2011     ▪ Buyer understands that by signing this certificate, Buyer gives up its right to claim a credit or payment for the taxable fuel purchased with the credit card to which this certificate relates. 1040ez 2011     ▪ Buyer acknowledges that it has not and will not claim any credit or payment for the taxable fuel purchased with the credit card to which this certificate relates. 1040ez 2011     ▪ Buyer understands that the fraudulent use of this certificate may subject Buyer and all parties making such fraudulent use of this certificate to a fine or imprisonment, or both, together with the costs of prosecution. 1040ez 2011           Printed or typed name of person signing           Title of person signing           Name of Buyer           Employer identification number           Address of Buyer           Signature and date signed   Model Statement S   STATEMENT OF BIODIESEL RESELLER     (To support a claim related to biodiesel or a biodiesel mixture under section 6426 of the Internal Revenue Code. 1040ez 2011 )     The undersigned biodiesel producer (“Reseller”) hereby certifies the following under penalties of perjury:   1. 1040ez 2011                   Reseller's name, address, and employer identification number (EIN)   2. 1040ez 2011                   Name, address, and EIN of Reseller's buyer   3. 1040ez 2011       Date and location of sale to buyer   4. 1040ez 2011 Volume of biodiesel sold   5. 1040ez 2011 Certificate Identification Number on the Certificate for Biodiesel       Reseller has bought the biodiesel described in the accompanying Certificate for Biodiesel and Reseller has no reason to believe that any information in the certificate is false. 1040ez 2011       Reseller has not been notified by the Internal Revenue Service that its right to provide a certificate or statement has been withdrawn. 1040ez 2011       Reseller understands that the fraudulent use of this statement may subject Reseller and all parties making any fraudulent use of this statement to a fine or imprisonment, or both, together with the costs of prosecution. 1040ez 2011           Printed or typed name of person signing this certificate           Title of person signing           Signature and date signed   Prev  Up  Next   Home   More Online Publications
Español

Life Insurance

Your need for life insurance will change with changes in your life. For example, the arrival of children usually triggers a sharp increase in the amount you need. As children grow older and leave the nest, you will probably need less protection.

Term life insurance policies are the least costly. They pay death benefits but have no cash value if you decide to stop making payments. As the word "term" suggests, these policies are in effect for a specific period of time-one year or until you reach a certain age are common. You can compare life insurance policies online.

Whole life, universal life, and other cash value policies combine a long-term savings and investment product with life insurance. Canceling these policies after only a few years can more than double your life insurance costs.

If you have misplaced a life insurance policy, your state’s insurance commission may be able to help you locate it. Or you can search for it at the Policy Locator. If the insurance company knows that an insured person has died, but cannot locate the beneficiaries, the company must turn the benefits over to the state’s unclaimed property office. Check with that office if you believe that you are due a benefit. You can avoid losing your life insurance policy by alerting the policy beneficiaries and filing a copy with your will.

Disability Insurance

Disability can be more disastrous financially than death. If you are disabled, you lose your earning power, but you still have living expenses and often huge expenses for medical care. Disability insurance helps you replace lost income. Many employers offer some type of disability insurance coverage for employees, or you can get an individual disability insurance policy. There are two types of disability policies: short-term disability (STD) and long-term disability (LTD). Short-term disability policies have a maximum benefit of two years, while long-term disability policies have benefits that can last the rest of your life. When purchasing disability insurance, ask:

  • How is disability defined? Some policies consider you disabled if you are unable to perform the duties of any job. Better plans pay benefits if you are unable to do the usual duties of your own occupation.
  • When do benefits begin? Most plans have a waiting period after an illness before payments begin.
  • How long do benefits last? After the waiting period, payments are usually available till you reach age 65, though shorter or longer terms are also available.
  • What dollar amount is promised? Can benefits be reduced by Social Security disability and workers' compensation payments? Are the benefits adjusted for inflation? Will the policy provider continue making contributions to your pension plan so you have retirement benefits when the disability coverage ends?

For more information on disability insurance, visit Insurance Information Institute or America's Health Insurance Plans.

The 1040ez 2011

1040ez 2011 4. 1040ez 2011   How Income of Aliens Is Taxed Table of Contents Introduction Topics - This chapter discusses: Useful Items - You may want to see: Resident Aliens Nonresident AliensTrade or Business in the United States Effectively Connected Income The 30% Tax Income From Real Property Transportation Tax Interrupted Period of Residence Expatriation TaxExpatriation Before June 4, 2004 Expatriation After June 3, 2004, and Before June 17, 2008 Expatriation After June 16, 2008 Introduction Resident and nonresident aliens are taxed in different ways. 1040ez 2011 Resident aliens are generally taxed in the same way as U. 1040ez 2011 S. 1040ez 2011 citizens. 1040ez 2011 Nonresident aliens are taxed based on the source of their income and whether or not their income is effectively connected with a U. 1040ez 2011 S. 1040ez 2011 trade or business. 1040ez 2011 The following discussions will help you determine if income you receive during the tax year is effectively connected with a U. 1040ez 2011 S. 1040ez 2011 trade or business and how it is taxed. 1040ez 2011 Topics - This chapter discusses: Income that is effectively connected with a U. 1040ez 2011 S. 1040ez 2011 trade or business. 1040ez 2011 Income that is not effectively connected with a U. 1040ez 2011 S. 1040ez 2011 trade or business. 1040ez 2011 Interrupted period of residence. 1040ez 2011 Expatriation tax. 1040ez 2011 Useful Items - You may want to see: Publication 544 Sales and Other Dispositions of Assets 1212 List of Original Issue Discount Instruments Form (and Instructions) 6251 Alternative Minimum Tax—Individuals Schedule D (Form 1040) Capital Gains and Losses See chapter 12 for information about getting these publications and forms. 1040ez 2011 Resident Aliens Resident aliens are generally taxed in the same way as U. 1040ez 2011 S. 1040ez 2011 citizens. 1040ez 2011 This means that their worldwide income is subject to U. 1040ez 2011 S. 1040ez 2011 tax and must be reported on their U. 1040ez 2011 S. 1040ez 2011 tax return. 1040ez 2011 Income of resident aliens is subject to the graduated tax rates that apply to U. 1040ez 2011 S. 1040ez 2011 citizens. 1040ez 2011 Resident aliens use the Tax Table or Tax Computation Worksheets located in the Form 1040 instructions, which apply to U. 1040ez 2011 S. 1040ez 2011 citizens. 1040ez 2011 Nonresident Aliens A nonresident alien's income that is subject to U. 1040ez 2011 S. 1040ez 2011 income tax must be divided into two categories: Income that is effectively connected with a trade or business in the United States, and Income that is not effectively connected with a trade or business in the United States (discussed under The 30% Tax, later). 1040ez 2011 The difference between these two categories is that effectively connected income, after allowable deductions, is taxed at graduated rates. 1040ez 2011 These are the same rates that apply to U. 1040ez 2011 S. 1040ez 2011 citizens and residents. 1040ez 2011 Income that is not effectively connected is taxed at a flat 30% (or lower treaty) rate. 1040ez 2011 If you were formerly a U. 1040ez 2011 S. 1040ez 2011 citizen or resident alien, these rules may not apply. 1040ez 2011 See Expatriation Tax, later, in this chapter. 1040ez 2011 Trade or Business in the United States Generally, you must be engaged in a trade or business during the tax year to be able to treat income received in that year as effectively connected with that trade or business. 1040ez 2011 Whether you are engaged in a trade or business in the United States depends on the nature of your activities. 1040ez 2011 The discussions that follow will help you determine whether you are engaged in a trade or business in the United States. 1040ez 2011 Personal Services If you perform personal services in the United States at any time during the tax year, you usually are considered engaged in a trade or business in the United States. 1040ez 2011 Certain compensation paid to a nonresident alien by a foreign employer is not included in gross income. 1040ez 2011 For more information, see Services Performed for Foreign Employer in chapter 3. 1040ez 2011 Other Trade or Business Activities Other examples of being engaged in a trade or business in the United States follow. 1040ez 2011 Students and trainees. 1040ez 2011   You are considered engaged in a trade or business in the United States if you are temporarily present in the United States as a nonimmigrant under an “F,” “J,” “M,” or “Q” visa. 1040ez 2011 A nonresident alien temporarily present in the United States under a “J” visa includes a nonresident alien individual admitted to the United States as an exchange visitor under the Mutual Educational and Cultural Exchange Act of 1961. 1040ez 2011 The taxable part of any scholarship or fellowship grant that is U. 1040ez 2011 S. 1040ez 2011 source income is treated as effectively connected with a trade or business in the United States. 1040ez 2011 Business operations. 1040ez 2011   If you own and operate a business in the United States selling services, products, or merchandise, you are, with certain exceptions, engaged in a trade or business in the United States. 1040ez 2011 Partnerships. 1040ez 2011   If you are a member of a partnership that at any time during the tax year is engaged in a trade or business in the United States, you are considered to be engaged in a trade or business in the United States. 1040ez 2011 Beneficiary of an estate or trust. 1040ez 2011   If you are the beneficiary of an estate or trust that is engaged in a trade or business in the United States, you are treated as being engaged in the same trade or business. 1040ez 2011 Trading in stocks, securities, and commodities. 1040ez 2011   If your only U. 1040ez 2011 S. 1040ez 2011 business activity is trading in stocks, securities, or commodities (including hedging transactions) through a U. 1040ez 2011 S. 1040ez 2011 resident broker or other agent, you are not engaged in a trade or business in the United States. 1040ez 2011   For transactions in stocks or securities, this applies to any nonresident alien, including a dealer or broker in stocks and securities. 1040ez 2011   For transactions in commodities, this applies to commodities that are usually traded on an organized commodity exchange and to transactions that are usually carried out at such an exchange. 1040ez 2011   This discussion does not apply if you have a U. 1040ez 2011 S. 1040ez 2011 office or other fixed place of business at any time during the tax year through which, or by the direction of which, you carry out your transactions in stocks, securities, or commodities. 1040ez 2011 Trading for a nonresident alien's own account. 1040ez 2011   You are not engaged in a trade or business in the United States if trading for your own account in stocks, securities, or commodities is your only U. 1040ez 2011 S. 1040ez 2011 business activity. 1040ez 2011 This applies even if the trading takes place while you are present in the United States or is done by your employee or your broker or other agent. 1040ez 2011   This does not apply to trading for your own account if you are a dealer in stocks, securities, or commodities. 1040ez 2011 This does not necessarily mean, however, that as a dealer you are considered to be engaged in a trade or business in the United States. 1040ez 2011 Determine that based on the facts and circumstances in each case or under the rules given above in Trading in stocks, securities, and commodities . 1040ez 2011 Effectively Connected Income If you are engaged in a U. 1040ez 2011 S. 1040ez 2011 trade or business, all income, gain, or loss for the tax year that you get from sources within the United States (other than certain investment income) is treated as effectively connected income. 1040ez 2011 This applies whether or not there is any connection between the income and the trade or business being carried on in the United States during the tax year. 1040ez 2011 Two tests, described next under Investment Income, determine whether certain items of investment income (such as interest, dividends, and royalties) are treated as effectively connected with that business. 1040ez 2011 In limited circumstances, some kinds of foreign source income may be treated as effectively connected with a trade or business in the United States. 1040ez 2011 For a discussion of these rules, see Foreign Income , later. 1040ez 2011 Investment Income Investment income from U. 1040ez 2011 S. 1040ez 2011 sources that may or may not be treated as effectively connected with a U. 1040ez 2011 S. 1040ez 2011 trade or business generally falls into the following three categories. 1040ez 2011 Fixed or determinable income (interest, dividends, rents, royalties, premiums, annuities, etc. 1040ez 2011 ). 1040ez 2011 Gains (some of which are considered capital gains) from the sale or exchange of the following types of property. 1040ez 2011 Timber, coal, or domestic iron ore with a retained economic interest. 1040ez 2011 Patents, copyrights, and similar property on which you receive contingent payments after October 4, 1966. 1040ez 2011 Patents transferred before October 5, 1966. 1040ez 2011 Original issue discount obligations. 1040ez 2011 Capital gains (and losses). 1040ez 2011 Use the two tests, described next, to determine whether an item of U. 1040ez 2011 S. 1040ez 2011 source income falling in one of the three categories above and received during the tax year is effectively connected with your U. 1040ez 2011 S. 1040ez 2011 trade or business. 1040ez 2011 If the tests indicate that the item of income is effectively connected, you must include it with your other effectively connected income. 1040ez 2011 If the item of income is not effectively connected, include it with all other income discussed under The 30% Tax later, in this chapter. 1040ez 2011 Asset-use test. 1040ez 2011   This test usually applies to income that is not directly produced by trade or business activities. 1040ez 2011 Under this test, if an item of income is from assets (property) used in, or held for use in, the trade or business in the United States, it is considered effectively connected. 1040ez 2011   An asset is used in, or held for use in, the trade or business in the United States if the asset is: Held for the principal purpose of promoting the conduct of a trade or business in the United States, Acquired and held in the ordinary course of the trade or business conducted in the United States (for example, an account receivable or note receivable arising from that trade or business), or Otherwise held to meet the present needs of the trade or business in the United States and not its anticipated future needs. 1040ez 2011 Generally, stock of a corporation is not treated as an asset used in, or held for use in, a trade or business in the United States. 1040ez 2011 Business-activities test. 1040ez 2011   This test usually applies when income, gain, or loss comes directly from the active conduct of the trade or business. 1040ez 2011 The business-activities test is most important when: Dividends or interest are received by a dealer in stocks or securities, Royalties are received in the trade or business of licensing patents or similar property, or Service fees are earned by a servicing business. 1040ez 2011 Under this test, if the conduct of the U. 1040ez 2011 S. 1040ez 2011 trade or business was a material factor in producing the income, the income is considered effectively connected. 1040ez 2011 Personal Service Income You usually are engaged in a U. 1040ez 2011 S. 1040ez 2011 trade or business when you perform personal services in the United States. 1040ez 2011 Personal service income you receive in a tax year in which you are engaged in a U. 1040ez 2011 S. 1040ez 2011 trade or business is effectively connected with a U. 1040ez 2011 S. 1040ez 2011 trade or business. 1040ez 2011 Income received in a year other than the year you performed the services is also effectively connected if it would have been effectively connected if received in the year you performed the services. 1040ez 2011 Personal service income includes wages, salaries, commissions, fees, per diem allowances, and employee allowances and bonuses. 1040ez 2011 The income may be paid to you in the form of cash, services, or property. 1040ez 2011 If you are engaged in a U. 1040ez 2011 S. 1040ez 2011 trade or business only because you perform personal services in the United States during the tax year, income and gains from assets, and gains and losses from the sale or exchange of capital assets are generally not effectively connected with your trade or business. 1040ez 2011 However, if there is a direct economic relationship between your holding of the asset and your trade or business of performing personal services, the income, gain, or loss is effectively connected. 1040ez 2011 Pensions. 1040ez 2011   If you were a nonresident alien engaged in a U. 1040ez 2011 S. 1040ez 2011 trade or business after 1986 because you performed personal services in the United States, and you later receive a pension or retirement pay attributable to these services, such payments are effectively connected income in each year you receive them. 1040ez 2011 This is true whether or not you are engaged in a U. 1040ez 2011 S. 1040ez 2011 trade or business in the year you receive the retirement pay. 1040ez 2011 Transportation Income Transportation income (defined in chapter 2) is effectively connected if you meet both of the following conditions. 1040ez 2011 You had a fixed place of business in the United States involved in earning the income. 1040ez 2011 At least 90% of your U. 1040ez 2011 S. 1040ez 2011 source transportation income is attributable to regularly scheduled transportation. 1040ez 2011 “Fixed place of business” generally means a place, site, structure, or other similar facility through which you engage in a trade or business. 1040ez 2011 “Regularly scheduled transportation” means that a ship or aircraft follows a published schedule with repeated sailings or flights at regular intervals between the same points for voyages or flights that begin or end in the United States. 1040ez 2011 This definition applies to both scheduled and chartered air transportation. 1040ez 2011 If you do not meet the two conditions above, the income is not effectively connected and is taxed at a 4% rate. 1040ez 2011 See Transportation Tax, later, in this chapter. 1040ez 2011 Business Profits and Losses and Sales Transactions All profits or losses from U. 1040ez 2011 S. 1040ez 2011 sources that are from the operation of a business in the United States are effectively connected with a trade or business in the United States. 1040ez 2011 For example, profit from the sale in the United States of inventory property purchased either in this country or in a foreign country is effectively connected trade or business income. 1040ez 2011 A share of U. 1040ez 2011 S. 1040ez 2011 source profits or losses of a partnership that is engaged in a trade or business in the United States is also effectively connected with a trade or business in the United States. 1040ez 2011 Real Property Gain or Loss Gains and losses from the sale or exchange of U. 1040ez 2011 S. 1040ez 2011 real property interests (whether or not they are capital assets) are taxed as if you are engaged in a trade or business in the United States. 1040ez 2011 You must treat the gain or loss as effectively connected with that trade or business. 1040ez 2011 U. 1040ez 2011 S. 1040ez 2011 real property interest. 1040ez 2011   This is any interest in real property located in the United States or the U. 1040ez 2011 S. 1040ez 2011 Virgin Islands or any interest (other than as a creditor) in a domestic corporation that is a U. 1040ez 2011 S. 1040ez 2011 real property holding corporation. 1040ez 2011 Real property includes the following. 1040ez 2011 Land and unsevered natural products of the land, such as growing crops and timber, and mines, wells, and other natural deposits. 1040ez 2011 Improvements on land, including buildings, other permanent structures, and their structural components. 1040ez 2011 Personal property associated with the use of real property, such as equipment used in farming, mining, forestry, or construction or property used in lodging facilities or rented office space, unless the personal property is: Disposed of more than one year before or after the disposition of the real property, or Separately sold to persons unrelated either to the seller or to the buyer of the real property. 1040ez 2011 U. 1040ez 2011 S. 1040ez 2011 real property holding corporation. 1040ez 2011   A corporation is a U. 1040ez 2011 S. 1040ez 2011 real property holding corporation if the fair market value of the corporation's U. 1040ez 2011 S. 1040ez 2011 real property interests are at least 50% of the total fair market value of: The corporation's U. 1040ez 2011 S. 1040ez 2011 real property interests, plus The corporation's interests in real property located outside the United States, plus The corporation's other assets that are used in, or held for use in, a trade or business. 1040ez 2011   Gain or loss on the sale of the stock in any domestic corporation is taxed as if you are engaged in a U. 1040ez 2011 S. 1040ez 2011 trade or business unless you establish that the corporation is not a U. 1040ez 2011 S. 1040ez 2011 real property holding corporation. 1040ez 2011   A U. 1040ez 2011 S. 1040ez 2011 real property interest does not include a class of stock of a corporation that is regularly traded on an established securities market, unless you hold more than 5% of the fair market value of that class of stock. 1040ez 2011 An interest in a foreign corporation owning U. 1040ez 2011 S. 1040ez 2011 real property generally is not a U. 1040ez 2011 S. 1040ez 2011 real property interest unless the corporation chooses to be treated as a domestic corporation. 1040ez 2011 Qualified investment entities. 1040ez 2011   Special rules apply to qualified investment entities (QIEs). 1040ez 2011 A QIE is any real estate investment trust (REIT) or any regulated investment company (RIC) that is a U. 1040ez 2011 S. 1040ez 2011 real property holding corporation. 1040ez 2011    Generally, any distribution from a QIE to a shareholder that is attributable to gain from the sale or exchange of a U. 1040ez 2011 S. 1040ez 2011 real property interest is treated as a U. 1040ez 2011 S. 1040ez 2011 real property gain by the shareholder receiving the distribution. 1040ez 2011 A distribution by a QIE on stock regularly traded on an established securities market in the United States is not treated as gain from the sale or exchange of a U. 1040ez 2011 S. 1040ez 2011 real property interest if you did not own more than 5% of that stock at any time during the 1-year period ending on the date of the distribution. 1040ez 2011 A distribution that you do not treat as gain from the sale or exchange of a U. 1040ez 2011 S. 1040ez 2011 real property interest is included in your gross income as a regular dividend. 1040ez 2011 Note. 1040ez 2011 Beginning January 1, 2014 (unless extended by legislation), a RIC that is a U. 1040ez 2011 S. 1040ez 2011 real property holding corporation will only be treated as a QIE for certain distributions from the RIC that are directly or indirectly attributable to distributions received by the RIC from a REIT. 1040ez 2011 Domestically controlled QIE. 1040ez 2011   The sale of an interest in a domestically controlled QIE is not the sale of a U. 1040ez 2011 S. 1040ez 2011 real property interest. 1040ez 2011 The entity is domestically controlled if at all times during the testing period less than 50% in value of its stock was held, directly or indirectly, by foreign persons. 1040ez 2011 The testing period is the shorter of (a) the 5-year period ending on the date of disposition, or (b) the period during which the entity was in existence. 1040ez 2011 Wash sale. 1040ez 2011    If you dispose of an interest in a domestically controlled QIE in an applicable wash sale transaction, special rules apply. 1040ez 2011 An applicable wash sale transaction is one in which you: Dispose of an interest in the domestically controlled QIE during the 30-day period before the ex-dividend date of a distribution that you would (but for the disposition) have treated as gain from the sale or exchange of a U. 1040ez 2011 S. 1040ez 2011 real property interest, and Acquire, or enter into a contract or option to acquire, a substantially identical interest in that entity during the 61-day period that began on the first day of the 30-day period. 1040ez 2011 If this occurs, you are treated as having gain from the sale or exchange of a U. 1040ez 2011 S. 1040ez 2011 real property interest in an amount equal to the distribution made after June 15, 2006, that would have been treated as such gain. 1040ez 2011 This also applies to any substitute dividend payment. 1040ez 2011   A transaction is not treated as an applicable wash sale transaction if: You actually receive the distribution from the domestically controlled QIE related to the interest disposed of, or acquired, in the transaction, or You dispose of any class of stock in a QIE that is regularly traded on an established securities market in the United States but only if you did not own more than 5% of that class of stock at any time during the 1-year period ending on the date of the distribution. 1040ez 2011 Alternative minimum tax. 1040ez 2011   There may be a minimum tax on your net gain from the disposition of U. 1040ez 2011 S. 1040ez 2011 real property interests. 1040ez 2011 Figure the amount of this tax, if any, on Form 6251. 1040ez 2011 Withholding of tax. 1040ez 2011   If you dispose of a U. 1040ez 2011 S. 1040ez 2011 real property interest, the buyer may have to withhold tax. 1040ez 2011 See the discussion of Tax Withheld on Real Property Sales in chapter 8. 1040ez 2011 Foreign Income You must treat three kinds of foreign source income as effectively connected with a trade or business in the United States if: You have an office or other fixed place of business in the United States to which the income can be attributed, That office or place of business is a material factor in producing the income, and The income is produced in the ordinary course of the trade or business carried on through that office or other fixed place of business. 1040ez 2011 An office or other fixed place of business is a material factor if it significantly contributes to, and is an essential economic element in, the earning of the income. 1040ez 2011 The three kinds of foreign source income are listed below. 1040ez 2011 Rents and royalties for the use of, or for the privilege of using, intangible personal property located outside the United States or from any interest in such property. 1040ez 2011 Included are rents or royalties for the use, or for the privilege of using, outside the United States, patents, copyrights, secret processes and formulas, goodwill, trademarks, trade brands, franchises, and similar properties if the rents or royalties are from the active conduct of a trade or business in the United States. 1040ez 2011 Dividends, interest, or amounts received for the provision of a guarantee of indebtedness issued after September 27, 2010, from the active conduct of a banking, financing, or similar business in the United States. 1040ez 2011 A substitute dividend or interest payment received under a securities lending transaction or a sale-repurchase transaction is treated the same as the amounts received on the transferred security. 1040ez 2011 Income, gain, or loss from the sale outside the United States, through the U. 1040ez 2011 S. 1040ez 2011 office or other fixed place of business, of: Stock in trade, Property that would be included in inventory if on hand at the end of the tax year, or Property held primarily for sale to customers in the ordinary course of business. 1040ez 2011 Item (3) will not apply if you sold the property for use, consumption, or disposition outside the United States and an office or other fixed place of business in a foreign country was a material factor in the sale. 1040ez 2011 Any foreign source income that is equivalent to any item of income described above is treated as effectively connected with a U. 1040ez 2011 S. 1040ez 2011 trade or business. 1040ez 2011 For example, foreign source interest and dividend equivalents are treated as U. 1040ez 2011 S. 1040ez 2011 effectively connected income if the income is derived by a foreign person in the active conduct of a banking, financing, or similar business within the United States. 1040ez 2011 Tax on Effectively Connected Income Income you receive during the tax year that is effectively connected with your trade or business in the United States is, after allowable deductions, taxed at the rates that apply to U. 1040ez 2011 S. 1040ez 2011 citizens and residents. 1040ez 2011 Generally, you can receive effectively connected income only if you are a nonresident alien engaged in trade or business in the United States during the tax year. 1040ez 2011 However, income you receive from the sale or exchange of property, the performance of services, or any other transaction in another tax year is treated as effectively connected in that year if it would have been effectively connected in the year the transaction took place or you performed the services. 1040ez 2011 Example. 1040ez 2011 Ted Richards, a nonresident alien, entered the United States in August 2012, to perform personal services in the U. 1040ez 2011 S. 1040ez 2011 office of his overseas employer. 1040ez 2011 He worked in the U. 1040ez 2011 S. 1040ez 2011 office until December 25, 2012, but did not leave this country until January 11, 2013. 1040ez 2011 On January 8, 2013, he received his final paycheck for services performed in the United States during 2012. 1040ez 2011 All of Ted's income during his stay here is U. 1040ez 2011 S. 1040ez 2011 source income. 1040ez 2011 During 2012, Ted was engaged in the trade or business of performing personal services in the United States. 1040ez 2011 Therefore, all amounts paid to him in 2012 for services performed in the United States during 2012 are effectively connected with that trade or business during 2012. 1040ez 2011 The salary payment Ted received in January 2013 is U. 1040ez 2011 S. 1040ez 2011 source income to him in 2013. 1040ez 2011 It is effectively connected with a trade or business in the United States because he was engaged in a trade or business in the United States during 2012 when he performed the services that earned the income. 1040ez 2011 Real property income. 1040ez 2011   You may be able to choose to treat all income from real property as effectively connected. 1040ez 2011 See Income From Real Property , later, in this chapter. 1040ez 2011 The 30% Tax Tax at a 30% (or lower treaty) rate applies to certain items of income or gains from U. 1040ez 2011 S. 1040ez 2011 sources but only if the items are not effectively connected with your U. 1040ez 2011 S. 1040ez 2011 trade or business. 1040ez 2011 Fixed or Determinable Income The 30% (or lower treaty) rate applies to the gross amount of U. 1040ez 2011 S. 1040ez 2011 source fixed or determinable annual or periodic gains, profits, or income. 1040ez 2011 Income is fixed when it is paid in amounts known ahead of time. 1040ez 2011 Income is determinable whenever there is a basis for figuring the amount to be paid. 1040ez 2011 Income can be periodic if it is paid from time to time. 1040ez 2011 It does not have to be paid annually or at regular intervals. 1040ez 2011 Income can be determinable or periodic even if the length of time during which the payments are made is increased or decreased. 1040ez 2011 Items specifically included as fixed or determinable income are interest (other than original issue discount), dividends, dividend equivalent payments (defined in chapter 2), rents, premiums, annuities, salaries, wages, and other compensation. 1040ez 2011 A substitute dividend or interest payment received under a securities lending transaction or a sale-repurchase transaction is treated the same as the amounts received on the transferred security. 1040ez 2011 Other items of income, such as royalties, also may be subject to the 30% tax. 1040ez 2011 Some fixed or determinable income may be exempt from U. 1040ez 2011 S. 1040ez 2011 tax. 1040ez 2011 See chapter 3 if you are not sure whether the income is taxable. 1040ez 2011 Original issue discount (OID). 1040ez 2011   If you sold, exchanged, or received a payment on a bond or other debt instrument that was issued at a discount after March 31, 1972, all or part of the original issue discount (OID) (other than portfolio interest) may be subject to the 30% tax. 1040ez 2011 The amount of OID is the difference between the stated redemption price at maturity and the issue price of the debt instrument. 1040ez 2011 The 30% tax applies in the following circumstances. 1040ez 2011 You received a payment on a debt instrument. 1040ez 2011 In this case, the amount of OID subject to tax is the OID that accrued while you held the debt instrument minus the OID previously taken into account. 1040ez 2011 But the tax on the OID cannot be more than the payment minus the tax on the interest payment on the debt instrument. 1040ez 2011 You sold or exchanged the debt instrument. 1040ez 2011 The amount of OID subject to tax is the OID that accrued while you held the debt instrument minus the amount already taxed in (1) above. 1040ez 2011   Report on your return the amount of OID shown on Form 1042-S, Foreign Person's U. 1040ez 2011 S. 1040ez 2011 Source Income Subject to Withholding, if you bought the debt instrument at original issue. 1040ez 2011 However, you must recompute your proper share of OID shown on Form 1042-S if any of the following apply. 1040ez 2011 You bought the debt instrument at a premium or paid an acquisition premium. 1040ez 2011 The debt instrument is a stripped bond or a stripped coupon (including zero coupon instruments backed by U. 1040ez 2011 S. 1040ez 2011 Treasury securities). 1040ez 2011 The debt instrument is a contingent payment or inflation-indexed debt instrument. 1040ez 2011 For the definition of premium and acquisition premium and instructions on how to recompute OID, get Publication 1212. 1040ez 2011   If you held a bond or other debt instrument that was issued at a discount before April 1, 1972, contact the IRS for further information. 1040ez 2011 See chapter 12. 1040ez 2011 Gambling Winnings In general, nonresident aliens are subject to the 30% tax on the gross proceeds from gambling won in the United States if that income is not effectively connected with a U. 1040ez 2011 S. 1040ez 2011 trade or business and is not exempted by treaty. 1040ez 2011 However, no tax is imposed on nonbusiness gambling income a nonresident alien wins playing blackjack, baccarat, craps, roulette, or big-6 wheel in the United States. 1040ez 2011 Nonresident aliens are taxed at graduated rates on net gambling income won in the United States that is effectively connected with a U. 1040ez 2011 S. 1040ez 2011 trade or business. 1040ez 2011 Social Security Benefits A nonresident alien must include 85% of any U. 1040ez 2011 S. 1040ez 2011 social security benefit (and the social security equivalent part of a tier 1 railroad retirement benefit) in U. 1040ez 2011 S. 1040ez 2011 source fixed or determinable annual or periodic income. 1040ez 2011 Social security benefits include monthly retirement, survivor, and disability benefits. 1040ez 2011 This income is exempt under some tax treaties. 1040ez 2011 See Table 1 in Publication 901, U. 1040ez 2011 S. 1040ez 2011 Tax Treaties, for a list of tax treaties that exempt U. 1040ez 2011 S. 1040ez 2011 social security benefits from U. 1040ez 2011 S. 1040ez 2011 tax. 1040ez 2011 Sales or Exchanges of Capital Assets These rules apply only to those capital gains and losses from sources in the United States that are not effectively connected with a trade or business in the United States. 1040ez 2011 They apply even if you are engaged in a trade or business in the United States. 1040ez 2011 These rules do not apply to the sale or exchange of a U. 1040ez 2011 S. 1040ez 2011 real property interest or to the sale of any property that is effectively connected with a trade or business in the United States. 1040ez 2011 See Real Property Gain or Loss , earlier, under Effectively Connected Income. 1040ez 2011 A capital asset is everything you own except: Inventory. 1040ez 2011 Business accounts or notes receivable. 1040ez 2011 Depreciable property used in a trade or business. 1040ez 2011 Real property used in a trade or business. 1040ez 2011 Supplies regularly used in a trade or business. 1040ez 2011 Certain copyrights, literary or musical or artistic compositions, letters or memoranda, or similar property. 1040ez 2011 Certain U. 1040ez 2011 S. 1040ez 2011 government publications. 1040ez 2011 Certain commodities derivative financial instruments held by a commodities derivatives dealer. 1040ez 2011 Hedging transactions. 1040ez 2011 A capital gain is a gain on the sale or exchange of a capital asset. 1040ez 2011 A capital loss is a loss on the sale or exchange of a capital asset. 1040ez 2011 If the sale is in foreign currency, for the purpose of determining gain, the cost and selling price of the property should be expressed in U. 1040ez 2011 S. 1040ez 2011 currency at the rate of exchange prevailing as of the date of the purchase and date of the sale, respectively. 1040ez 2011 You may want to read Publication 544. 1040ez 2011 However, use Publication 544 only to determine what is a sale or exchange of a capital asset, or what is treated as such. 1040ez 2011 Specific tax treatment that applies to U. 1040ez 2011 S. 1040ez 2011 citizens or residents generally does not apply to you. 1040ez 2011 The following gains are subject to the 30% (or lower treaty) rate without regard to the 183-day rule, discussed later. 1040ez 2011 Gains on the disposal of timber, coal, or domestic iron ore with a retained economic interest. 1040ez 2011 Gains on contingent payments received from the sale or exchange of patents, copyrights, and similar property after October 4, 1966. 1040ez 2011 Gains on certain transfers of all substantial rights to, or an undivided interest in, patents if the transfers were made before October 5, 1966. 1040ez 2011 Gains on the sale or exchange of original issue discount obligations. 1040ez 2011 Gains in (1) are not subject to the 30% (or lower treaty) rate if you choose to treat the gains as effectively connected with a U. 1040ez 2011 S. 1040ez 2011 trade or business. 1040ez 2011 See Income From Real Property , later. 1040ez 2011 183-day rule. 1040ez 2011   If you were in the United States for 183 days or more during the tax year, your net gain from sales or exchanges of capital assets is taxed at a 30% (or lower treaty) rate. 1040ez 2011 For purposes of the 30% (or lower treaty) rate, net gain is the excess of your capital gains from U. 1040ez 2011 S. 1040ez 2011 sources over your capital losses from U. 1040ez 2011 S. 1040ez 2011 sources. 1040ez 2011 This rule applies even if any of the transactions occurred while you were not in the United States. 1040ez 2011   To determine your net gain, consider the amount of your gains and losses that would be recognized and taken into account only if, and to the extent that, they would be recognized and taken into account if you were in a U. 1040ez 2011 S. 1040ez 2011 trade or business during the year and the gains and losses were effectively connected with that trade or business during the tax year. 1040ez 2011   In arriving at your net gain, do not take the following into consideration. 1040ez 2011 The four types of gains listed earlier. 1040ez 2011 The deduction for a capital loss carryover. 1040ez 2011 Capital losses in excess of capital gains. 1040ez 2011 Exclusion for gain from the sale or exchange of qualified small business stock (section 1202 exclusion). 1040ez 2011 Losses from the sale or exchange of property held for personal use. 1040ez 2011 However, losses resulting from casualties or thefts may be deductible on Schedule A (Form 1040NR). 1040ez 2011 See Itemized Deductions in chapter 5. 1040ez 2011   If you are not engaged in a trade or business in the United States and have not established a tax year for a prior period, your tax year will be the calendar year for purposes of the 183-day rule. 1040ez 2011 Also, you must file your tax return on a calendar-year basis. 1040ez 2011   If you were in the United States for less than 183 days during the tax year, capital gains (other than gains listed earlier) are tax exempt unless they are effectively connected with a trade or business in the United States during your tax year. 1040ez 2011 Reporting. 1040ez 2011   Report your gains and losses from the sales or exchanges of capital assets that are not effectively connected with a trade or business in the United States on page 4 of Form 1040NR. 1040ez 2011 Report gains and losses from sales or exchanges of capital assets (including real property) that are effectively connected with a trade or business in the United States on a separate Schedule D (Form 1040), Form 4797, or both. 1040ez 2011 Attach them to Form 1040NR. 1040ez 2011 Income From Real Property If you have income from real property located in the United States that you own or have an interest in and hold for the production of income, you can choose to treat all income from that property as income effectively connected with a trade or business in the United States. 1040ez 2011 The choice applies to all income from real property located in the United States and held for the production of income and to all income from any interest in such property. 1040ez 2011 This includes income from rents, royalties from mines, oil or gas wells, or other natural resources. 1040ez 2011 It also includes gains from the sale or exchange of timber, coal, or domestic iron ore with a retained economic interest. 1040ez 2011 You can make this choice only for real property income that is not otherwise effectively connected with your U. 1040ez 2011 S. 1040ez 2011 trade or business. 1040ez 2011 If you make the choice, you can claim deductions attributable to the real property income and only your net income from real property is taxed. 1040ez 2011 This choice does not treat a nonresident alien, who is not otherwise engaged in a U. 1040ez 2011 S. 1040ez 2011 trade or business, as being engaged in a trade or business in the United States during the year. 1040ez 2011 Example. 1040ez 2011 You are a nonresident alien and are not engaged in a U. 1040ez 2011 S. 1040ez 2011 trade or business. 1040ez 2011 You own a single-family house in the United States that you rent out. 1040ez 2011 Your rental income for the year is $10,000. 1040ez 2011 This is your only U. 1040ez 2011 S. 1040ez 2011 source income. 1040ez 2011 As discussed earlier under The 30% Tax, the rental income is subject to a tax at a 30% (or lower treaty) rate. 1040ez 2011 You received a Form 1042-S showing that your tenants properly withheld this tax from the rental income. 1040ez 2011 You do not have to file a U. 1040ez 2011 S. 1040ez 2011 tax return (Form 1040NR) because your U. 1040ez 2011 S. 1040ez 2011 tax liability is satisfied by the withholding of tax. 1040ez 2011 If you make the choice discussed earlier, you can offset the $10,000 income by certain rental expenses. 1040ez 2011 (See Publication 527, Residential Rental Property, for information on rental expenses. 1040ez 2011 ) Any resulting net income is taxed at graduated rates. 1040ez 2011 If you make this choice, report the rental income and expenses on Schedule E (Form 1040) and attach the schedule to Form 1040NR. 1040ez 2011 For the first year you make the choice, also attach the statement discussed next. 1040ez 2011 Making the choice. 1040ez 2011   Make the initial choice by attaching a statement to your return, or amended return, for the year of the choice. 1040ez 2011 Include the following in your statement. 1040ez 2011 That you are making the choice. 1040ez 2011 Whether the choice is under Internal Revenue Code section 871(d) (explained earlier) or a tax treaty. 1040ez 2011 A complete list of all your real property, or any interest in real property, located in the United States. 1040ez 2011 Give the legal identification of U. 1040ez 2011 S. 1040ez 2011 timber, coal, or iron ore in which you have an interest. 1040ez 2011 The extent of your ownership in the property. 1040ez 2011 The location of the property. 1040ez 2011 A description of any major improvements to the property. 1040ez 2011 The dates you owned the property. 1040ez 2011 Your income from the property. 1040ez 2011 Details of any previous choices and revocations of the real property income choice. 1040ez 2011   This choice stays in effect for all later tax years unless you revoke it. 1040ez 2011 Revoking the choice. 1040ez 2011   You can revoke the choice without IRS approval by filing Form 1040X, Amended U. 1040ez 2011 S. 1040ez 2011 Individual Income Tax Return, for the year you made the choice and for later tax years. 1040ez 2011 You must file Form 1040X within 3 years from the date your return was filed or 2 years from the time the tax was paid, whichever is later. 1040ez 2011 If this time period has expired for the year of choice, you cannot revoke the choice for that year. 1040ez 2011 However, you may revoke the choice for later tax years only if you have IRS approval. 1040ez 2011 For information on how to get IRS approval, see Regulation section 1. 1040ez 2011 871-10(d)(2). 1040ez 2011 Transportation Tax A 4% tax rate applies to transportation income that is not effectively connected because it does not meet the two conditions listed earlier under Transportation Income . 1040ez 2011 If you receive transportation income subject to the 4% tax, you should figure the tax and show it on line 57 of Form 1040NR. 1040ez 2011 Attach a statement to your return that includes the following information (if applicable). 1040ez 2011 Your name, taxpayer identification number, and tax year. 1040ez 2011 A description of the types of services performed (whether on or off board). 1040ez 2011 Names of vessels or registration numbers of aircraft on which you performed the services. 1040ez 2011 Amount of U. 1040ez 2011 S. 1040ez 2011 source transportation income derived from each type of service for each vessel or aircraft for the calendar year. 1040ez 2011 Total amount of U. 1040ez 2011 S. 1040ez 2011 source transportation income derived from all types of services for the calendar year. 1040ez 2011 This 4% tax applies to your U. 1040ez 2011 S. 1040ez 2011 source gross transportation income. 1040ez 2011 This only includes transportation income that is treated as derived from sources in the United States if the transportation begins or ends in the United States. 1040ez 2011 For transportation income from personal services, the transportation must be between the United States and a U. 1040ez 2011 S. 1040ez 2011 possession. 1040ez 2011 For personal services of a nonresident alien, this only applies to income derived from, or in connection with, an aircraft. 1040ez 2011 Interrupted Period of Residence You are subject to tax under a special rule if you interrupt your period of U. 1040ez 2011 S. 1040ez 2011 residence with a period of nonresidence. 1040ez 2011 The special rule applies if you meet all of the following conditions. 1040ez 2011 You were a U. 1040ez 2011 S. 1040ez 2011 resident for a period that includes at least 3 consecutive calendar years. 1040ez 2011 You were a U. 1040ez 2011 S. 1040ez 2011 resident for at least 183 days in each of those years. 1040ez 2011 You ceased to be treated as a U. 1040ez 2011 S. 1040ez 2011 resident. 1040ez 2011 You then again became a U. 1040ez 2011 S. 1040ez 2011 resident before the end of the third calendar year after the end of the period described in (1) above. 1040ez 2011 Under this special rule, you are subject to tax on your U. 1040ez 2011 S. 1040ez 2011 source gross income and gains on a net basis at the graduated rates applicable to individuals (with allowable deductions) for the period you were a nonresident alien, unless you would be subject to a higher tax under the 30% tax (discussed earlier) on income not connected with a U. 1040ez 2011 S. 1040ez 2011 trade or business. 1040ez 2011 For information on how to figure the special tax, see How To Figure the Expatriation Tax (If You Expatriated Before June 17, 2008) under Expatriation Tax , below. 1040ez 2011 Example. 1040ez 2011 John Willow, a citizen of New Zealand, entered the United States on April 1, 2008, as a lawful permanent resident. 1040ez 2011 On August 1, 2010, John ceased to be a lawful permanent resident and returned to New Zealand. 1040ez 2011 During his period of residence, he was present in the United States for at least 183 days in each of three consecutive years (2008, 2009, and 2010). 1040ez 2011 He returned to the United States on October 5, 2013, as a lawful permanent resident. 1040ez 2011 He became a resident before the close of the third calendar year (2013) beginning after the end of his first period of residence (August 1, 2010). 1040ez 2011 Therefore, he is subject to tax under the special rule for the period of nonresidence (August 2, 2010, through October 4, 2013) if it is more than the tax that would normally apply to him as a nonresident alien. 1040ez 2011 Reporting requirements. 1040ez 2011   If you are subject to this tax for any year in the period you were a nonresident alien, you must file Form 1040NR for that year. 1040ez 2011 The return is due by the due date (including extensions) for filing your U. 1040ez 2011 S. 1040ez 2011 income tax return for the year that you again become a U. 1040ez 2011 S. 1040ez 2011 resident. 1040ez 2011 If you already filed returns for that period, you must file amended returns. 1040ez 2011 You must attach a statement to your return that identifies the source of all of your U. 1040ez 2011 S. 1040ez 2011 and foreign gross income and the items of income subject to this special rule. 1040ez 2011 Expatriation Tax The expatriation tax provisions apply to U. 1040ez 2011 S. 1040ez 2011 citizens who have renounced their citizenship and long-term residents who have ended their residency. 1040ez 2011 The rules that apply are based on the dates of expatriation, which are described in the following sections. 1040ez 2011 Expatriation Before June 4, 2004. 1040ez 2011 Expatriation After June 3, 2004, and Before June 17, 2008. 1040ez 2011 Expatriation After June 16, 2008. 1040ez 2011 Long-term resident defined. 1040ez 2011   You are a long-term resident if you were a lawful permanent resident of the United States in at least 8 of the last 15 tax years ending with the year your residency ends. 1040ez 2011 In determining if you meet the 8-year requirement, do not count any year that you are treated as a resident of a foreign country under a tax treaty and do not waive treaty benefits. 1040ez 2011 Expatriation Before June 4, 2004 If you expatriated before June 4, 2004, the expatriation rules apply if one of the principal purposes of the action is the avoidance of U. 1040ez 2011 S. 1040ez 2011 taxes. 1040ez 2011 Unless you received a ruling from the IRS that you did not expatriate to avoid U. 1040ez 2011 S. 1040ez 2011 taxes, you are presumed to have tax avoidance as a principal purpose if: Your average annual net income tax for the last 5 tax years ending before the date of your action to relinquish your citizenship or terminate your residency was more than $100,000, or Your net worth on the date of your action was $500,000 or more. 1040ez 2011 The amounts above are adjusted for inflation if your expatriation action is after 1997 (see Table 4-1). 1040ez 2011 Table 4-1. 1040ez 2011 Inflation-Adjusted Amounts for Expatriation Actions Before June 4, 2004 IF you expatriated during . 1040ez 2011 . 1040ez 2011 . 1040ez 2011   THEN the rules outlined on this page apply if . 1040ez 2011 . 1040ez 2011 . 1040ez 2011     Your 5-year average annual net income tax was more than . 1040ez 2011 . 1040ez 2011 . 1040ez 2011 OR Your net worth equaled or exceeded . 1040ez 2011 . 1040ez 2011 . 1040ez 2011 1999   110,000   552,000 2000   112,000   562,000 2001   116,000   580,000 2002   120,000   599,000 2003   122,000   608,000 2004 (before June 4)*   124,000   622,000 *If you expatriated after June 3, 2004, see Expatriation After June 3, 2004, and Before June 17, 2008 or Expatriation After June 16, 2008. 1040ez 2011 Reporting requirements. 1040ez 2011   If you lost your U. 1040ez 2011 S. 1040ez 2011 citizenship, you should have filed Form 8854 with a consular office or a federal court at the time of loss of citizenship. 1040ez 2011 If you ended your long-term residency, you should have filed Form 8854 with the Internal Revenue Service when you filed your dual-status tax return for the year your residency ended. 1040ez 2011   Your U. 1040ez 2011 S. 1040ez 2011 residency is considered to have ended when you ceased to be a lawful permanent resident or you began to be treated as a resident of another country under a tax treaty and do not waive treaty benefits. 1040ez 2011 Penalties. 1040ez 2011   If you failed to file Form 8854, you may have to pay a penalty equal to the greater of 5% of the expatriation tax or $1,000. 1040ez 2011 The penalty will be assessed for each year of the 10-year period beginning on the date of expatriation during which your failure to file continues. 1040ez 2011 The penalty will not be imposed if you can show that the failure is due to reasonable cause and not willful neglect. 1040ez 2011 Expatriation tax. 1040ez 2011   The expatriation tax applies to the 10-year period following the date of expatriation or termination of residency. 1040ez 2011 It is figured in the same way as for those expatriating after June 3, 2004, and before June 17, 2008. 1040ez 2011 See How To Figure the Expatriation Tax (If You Expatriated Before June 17, 2008) in the next section. 1040ez 2011 Expatriation After June 3, 2004, and Before June 17, 2008 If you expatriated after June 3, 2004, and before June 17, 2008, the expatriation rules apply to you if any of the following statements apply. 1040ez 2011 Your average annual net income tax for the 5 tax years ending before the date of expatriation or termination of residency is more than: $124,000 if you expatriated or terminated residency in 2004. 1040ez 2011 $127,000 if you expatriated or terminated residency in 2005. 1040ez 2011 $131,000 if you expatriated or terminated residency in 2006. 1040ez 2011 $136,000 if you expatriated or terminated residency in 2007. 1040ez 2011 $139,000 if you expatriated or terminated residency in 2008. 1040ez 2011 Your net worth is $2 million or more on the date of your expatriation or termination of residency. 1040ez 2011 You fail to certify on Form 8854 that you have complied with all U. 1040ez 2011 S. 1040ez 2011 federal tax obligations for the 5 tax years preceding the date of your expatriation or termination of residency. 1040ez 2011 Exception for dual-citizens and certain minors. 1040ez 2011   Certain dual-citizens and certain minors (defined next) are not subject to the expatriation tax even if they meet (1) or (2) earlier. 1040ez 2011 However, they still must provide the certification required in (3). 1040ez 2011 Certain dual-citizens. 1040ez 2011   You may qualify for the exception described above if all of the following apply. 1040ez 2011 You became at birth a U. 1040ez 2011 S. 1040ez 2011 citizen and a citizen of another country and you continue to be a citizen of that other country. 1040ez 2011 You were never a resident alien of the United States (as defined in chapter 1). 1040ez 2011 You never held a U. 1040ez 2011 S. 1040ez 2011 passport. 1040ez 2011 You were present in the United States for no more than 30 days during any calendar year that is 1 of the 10 calendar years preceding your loss of U. 1040ez 2011 S. 1040ez 2011 citizenship. 1040ez 2011 Certain minors. 1040ez 2011   You may qualify for the exception described above if you meet all of the following requirements. 1040ez 2011 You became a U. 1040ez 2011 S. 1040ez 2011 citizen at birth. 1040ez 2011 Neither of your parents was a U. 1040ez 2011 S. 1040ez 2011 citizen at the time of your birth. 1040ez 2011 You expatriated before you were 18½. 1040ez 2011 You were present in the United States for not more than 30 days during any calendar year that is 1 of the 10 calendar years preceding your expatriation. 1040ez 2011 Tax consequences of presence in the United States. 1040ez 2011   The following rules apply if you do not meet the exception above for dual-citizens and certain minors and the expatriation rules would otherwise apply to you. 1040ez 2011   The expatriation tax does not apply to any tax year during the 10-year period if you are physically present in the United States for more than 30 days during the calendar year ending in that year. 1040ez 2011 Instead, you are treated as a U. 1040ez 2011 S. 1040ez 2011 citizen or resident and taxed on your worldwide income for that tax year. 1040ez 2011 You must file Form 1040, 1040A, or 1040EZ and figure your tax as prescribed in the instructions for those forms. 1040ez 2011   When counting the number of days of presence during a calendar year, count any day you were physically present in the United States at any time during the day. 1040ez 2011 However, do not count any days (up to a limit of 30 days) on which you performed personal services in the United States for an employer who is not related to you if either of the following apply. 1040ez 2011 You have ties with other countries. 1040ez 2011 You have ties with other countries if: You became (within a reasonable period after your expatriation or termination of residency) a citizen or resident of the country in which you, your spouse, or either of your parents were born, and You became fully liable for income tax in that country. 1040ez 2011 You were physically present in the United States for 30 days or less during each year in the 10-year period ending on the date of expatriation or termination of residency. 1040ez 2011 Do not count any day you were an exempt individual or were unable to leave the United States because of a medical condition that arose while you were in the United States. 1040ez 2011 See Exempt individual and Medical condition in chapter 1 under Substantial Presence Test, but disregard the information about Form 8843. 1040ez 2011 Related employer. 1040ez 2011   If your employer in the United States is any of the following, then your employer is related to you. 1040ez 2011 You must count any days you performed services in the United States for that employer as days of presence in the United States. 1040ez 2011 Members of your family. 1040ez 2011 This includes only your brothers and sisters, half-brothers and half-sisters, spouse, ancestors (parents, grandparents, etc. 1040ez 2011 ), and lineal descendants (children, grandchildren, etc. 1040ez 2011 ). 1040ez 2011 A partnership in which you directly or indirectly own more than 50% of the capital interest or the profits interest. 1040ez 2011 A corporation in which you directly or indirectly own more than 50% in value of the outstanding stock. 1040ez 2011 (See Publication 550, chapter 4, Constructive ownership of stock, for how to determine whether you directly or indirectly own outstanding stock. 1040ez 2011 ) A tax-exempt charitable or educational organization that is directly or indirectly controlled, in any manner or by any method, by you or by a member of your family, whether or not this control is legally enforceable. 1040ez 2011 Date of tax expatriation. 1040ez 2011   For purposes of U. 1040ez 2011 S. 1040ez 2011 tax rules, the date of your expatriation or termination of residency is the later of the dates on which you perform the following actions. 1040ez 2011 You notify either the Department of State or the Department of Homeland Security (whichever is appropriate) of your expatriating act or termination of residency. 1040ez 2011 You file Form 8854 in accordance with the form instructions. 1040ez 2011 Annual return. 1040ez 2011   If the expatriation tax applies to you, you must file Form 8854 each year during the 10-year period following the date of expatriation. 1040ez 2011 You must file this form even if you owe no U. 1040ez 2011 S. 1040ez 2011 tax. 1040ez 2011 Penalty. 1040ez 2011   If you fail to file Form 8854 for any tax year, fail to include all information required to be shown on the form, or include incorrect information, you may have to pay a penalty of $10,000. 1040ez 2011 You will not have to pay a penalty if you show that the failure is due to reasonable cause and not to willful neglect. 1040ez 2011 How To Figure the Expatriation Tax (If You Expatriated Before June 17, 2008) If the expatriation tax applies to you, you are generally subject to tax on your U. 1040ez 2011 S. 1040ez 2011 source gross income and gains on a net basis at the graduated rates applicable to individuals (with allowable deductions) unless you would be subject to a higher tax under the 30% tax (discussed earlier) on income not connected with a U. 1040ez 2011 S. 1040ez 2011 trade or business. 1040ez 2011 For this purpose, U. 1040ez 2011 S. 1040ez 2011 source gross income (defined in chapter 2) includes gains from the sale or exchange of: Property (other than stock or debt obligations) located in the United States, Stock issued by a U. 1040ez 2011 S. 1040ez 2011 domestic corporation, and Debt obligations of U. 1040ez 2011 S. 1040ez 2011 persons or of the United States, a state or political subdivision thereof, or the District of Columbia. 1040ez 2011 U. 1040ez 2011 S. 1040ez 2011 source income also includes any income or gain derived from stock in certain controlled foreign corporations if you owned, or were considered to own, at any time during the 2-year period ending on the date of expatriation, more than 50% of: The total combined voting power of all classes of that corporation's stock, or The total value of the stock. 1040ez 2011 The income or gain is considered U. 1040ez 2011 S. 1040ez 2011 source income only to the extent of your share of earnings and profits earned or accumulated before the date of expatriation and during the periods you met the ownership requirements discussed above. 1040ez 2011 Any exchange of property is treated as a sale of the property at its fair market value on the date of the exchange and any gain is treated as U. 1040ez 2011 S. 1040ez 2011 source gross income in the tax year of the exchange unless you enter into a gain recognition agreement under Notice 97-19. 1040ez 2011 Other information. 1040ez 2011   For more information on the expatriation tax provisions, including exceptions to the tax and special U. 1040ez 2011 S. 1040ez 2011 source rules, see section 877 of the Internal Revenue Code. 1040ez 2011 Expatriation Tax Return If you expatriated or terminated your U. 1040ez 2011 S. 1040ez 2011 residency, or you are subject to the expatriation tax, you must file Form 8854, Initial and Annual Expatriation Statement. 1040ez 2011 Attach it to Form 1040NR if you are required to file that form. 1040ez 2011 If you are present in the United States following your expatriation and are subject to tax as a U. 1040ez 2011 S. 1040ez 2011 citizen or resident, file Form 8854 with Form 1040. 1040ez 2011 Expatriation After June 16, 2008 If you expatriated after June 16, 2008, the expatriation rules apply to you if you meet any of the following conditions. 1040ez 2011 Your average annual net income tax for the 5 years ending before the date of expatriation or termination of residency is more than: $139,000 if you expatriated or terminated residency in 2008. 1040ez 2011 $145,000 if you expatriated or terminated residency in 2009 or 2010. 1040ez 2011 $147,000 if you expatriated or terminated residency in 2011. 1040ez 2011 $151,000 if you expatriated or terminated residency in 2012. 1040ez 2011 $155,000 if you expatriated or terminated residency in 2013. 1040ez 2011 Your net worth is $2 million or more on the date of your expatriation or termination of residency. 1040ez 2011 You fail to certify on Form 8854 that you have complied with all U. 1040ez 2011 S. 1040ez 2011 federal tax obligations for the 5 years preceding the date of your expatriation or termination of residency. 1040ez 2011 Exception for dual-citizens and certain minors. 1040ez 2011   Certain dual-citizens and certain minors (defined next) are not subject to the expatriation tax even if they meet (1) or (2) above. 1040ez 2011 However, they still must provide the certification required in (3) above. 1040ez 2011 Certain dual-citizens. 1040ez 2011   You may qualify for the exception described above if both of the following apply. 1040ez 2011 You became at birth a U. 1040ez 2011 S. 1040ez 2011 citizen and a citizen of another country and you continue to be a citizen of, and are taxed as a resident of, that other country. 1040ez 2011 You have been a resident of the United States for not more than 10 years during the 15-year tax period ending with the tax year during which the expatriation occurs. 1040ez 2011 For the purpose of determining U. 1040ez 2011 S. 1040ez 2011 residency, use the substantial presence test described in chapter 1. 1040ez 2011 Certain minors. 1040ez 2011   You may qualify for the exception described earlier if you meet both of the following requirements. 1040ez 2011 You expatriated before you were 18½. 1040ez 2011 You have been a resident of the United States for not more than 10 tax years before the expatriation occurs. 1040ez 2011 For the purpose of determining U. 1040ez 2011 S. 1040ez 2011 residency, use the substantial presence test described in chapter 1. 1040ez 2011 Expatriation date. 1040ez 2011   Your expatriation date is the date you relinquish U. 1040ez 2011 S. 1040ez 2011 citizenship (in the case of a former citizen) or terminate your long-term residency (in the case of a former U. 1040ez 2011 S. 1040ez 2011 resident). 1040ez 2011 Former U. 1040ez 2011 S. 1040ez 2011 citizen. 1040ez 2011   You are considered to have relinquished your U. 1040ez 2011 S. 1040ez 2011 citizenship on the earliest of the following dates. 1040ez 2011 The date you renounced U. 1040ez 2011 S. 1040ez 2011 citizenship before a diplomatic or consular officer of the United States (provided that the voluntary renouncement was later confirmed by the issuance of a certificate of loss of nationality). 1040ez 2011 The date you furnished to the State Department a signed statement of voluntary relinquishment of U. 1040ez 2011 S. 1040ez 2011 nationality confirming the performance of an expatriating act (provided that the voluntary relinquishment was later confirmed by the issuance of a certificate of loss of nationality). 1040ez 2011 The date the State Department issued a certificate of loss of nationality. 1040ez 2011 The date that a U. 1040ez 2011 S. 1040ez 2011 court canceled your certificate of naturalization. 1040ez 2011 Former long-term resident. 1040ez 2011   You are considered to have terminated your long-term residency on the earliest of the following dates. 1040ez 2011 The date you voluntarily relinquished your lawful permanent resident status by filing Department of Homeland Security Form I-407 with a U. 1040ez 2011 S. 1040ez 2011 consular or immigration officer, and the Department of Homeland Security determined that you have, in fact, abandoned your lawful permanent resident status. 1040ez 2011 The date you became subject to a final administrative order for your removal from the United States under the Immigration and Nationality Act and you actually left the United States as a result of that order. 1040ez 2011 If you were a dual resident of the United States and a country with which the United States has an income tax treaty, the date you began to be treated as a resident of that country and you determined that, for purposes of the treaty, you are a resident of the treaty country and notify the IRS of that treatment on Forms 8833 and 8854. 1040ez 2011 See Effect of Tax Treaties in chapter 1 for more information about dual residents. 1040ez 2011 How To Figure the Expatriation Tax (If You Expatriate After June 16, 2008) In the year you expatriate, you are subject to income tax on the net unrealized gain (or loss) in your property as if the property had been sold for its fair market value on the day before your expatriation date (“mark-to-market tax”). 1040ez 2011 This applies to most types of property interests you held on the date of relinquishment of citizenship or termination of residency. 1040ez 2011 But see Exceptions , later. 1040ez 2011 Gains arising from deemed sales must be taken into account for the tax year of the deemed sale without regard to other U. 1040ez 2011 S. 1040ez 2011 internal revenue laws. 1040ez 2011 Losses from deemed sales must be taken into account to the extent otherwise provided under U. 1040ez 2011 S. 1040ez 2011 internal revenue laws. 1040ez 2011 However, Internal Revenue Code section 1091 (relating to the disallowance of losses on wash sales of stock and securities) does not apply. 1040ez 2011 The net gain that you otherwise must include in your income is reduced (but not below zero) by: $600,000 if you expatriated or terminated residency before January 1, 2009. 1040ez 2011 $626,000 if you expatriated or terminated residency in 2009. 1040ez 2011 $627,000 if you expatriated or terminated residency in 2010. 1040ez 2011 $636,000 if you expatriated or terminated residency in 2011. 1040ez 2011 $651,000 if you expatriated or terminated residency in 2012. 1040ez 2011 $668,000 if you expatriated or terminated residency in 2013. 1040ez 2011 Exceptions. 1040ez 2011   The mark-to-market tax does not apply to the following. 1040ez 2011 Eligible deferred compensation items. 1040ez 2011 Ineligible deferred compensation items. 1040ez 2011 Interests in nongrantor trusts. 1040ez 2011 Specified tax deferred accounts. 1040ez 2011 Instead, items (1) and (3) may be subject to withholding at source. 1040ez 2011 In the case of item (2), you are treated as receiving the present value of your accrued benefit as of the day before the expatriation date. 1040ez 2011 In the case of item (4), you are treated as receiving a distribution of your entire interest in the account on the day before your expatriation date. 1040ez 2011 See paragraphs (d), (e), and (f) of section 877A for more information. 1040ez 2011 Expatriation Tax Return If you expatriated or terminated your U. 1040ez 2011 S. 1040ez 2011 residency, or you are subject to the expatriation rules (as discussed earlier in the first paragraph under Expatriation After June 16, 2008), you must file Form 8854. 1040ez 2011 Attach it to Form 1040 or Form 1040NR if you are required to file either of those forms. 1040ez 2011 Deferral of payment of mark-to-market tax. 1040ez 2011   You can make an irrevocable election to defer payment of the mark-to-market tax imposed on the deemed sale of property. 1040ez 2011 If you make this election, the following rules apply. 1040ez 2011 You can make the election on a property-by-property basis. 1040ez 2011 The deferred tax attributable to a particular property is due on the return for the tax year in which you dispose of the property. 1040ez 2011 Interest is charged for the period the tax is deferred. 1040ez 2011 The due date for the payment of the deferred tax cannot be extended beyond the earlier of the following dates. 1040ez 2011 The due date of the return required for the year of death. 1040ez 2011 The time that the security provided for the property fails to be adequate. 1040ez 2011 See item (6) below. 1040ez 2011 You make the election on Form 8854. 1040ez 2011 You must provide adequate security (such as a bond). 1040ez 2011 You must make an irrevocable waiver of any right under any treaty of the United States which would preclude assessment or collection of the mark-to-market tax. 1040ez 2011   For more information about the deferral of payment, see the Instructions for Form 8854. 1040ez 2011 Prev  Up  Next   Home   More Online Publications