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2012 Amended Tax Forms

Forgot To File Taxes 20122012 Federal Tax Forms 1040aIrs 1040x 20121040ez 2011Taxact 2011 Returning UserFile 1040ez OnlineAmended Tax Return Form 20112012 TaxForm 1040nr EzTaxes 2012Www Irs Gov Eo1040ez 2012 WorksheetEtax1040ez Form OnlineIrs Form 1040ez InstructionsState Tax Return FreeFree Tax Filing OnlineAmend A Tax Return1040nr Ez E FileIrs FormsWhere Can I File My State Taxes Online2011 Federal Tax Form 1040 Ez InstructionsIrs 2012 Tax Forms 1040ezWww Handrblock ComHow To Amend 2010 Tax Return2010 Irs Form 1040Free Ez Form1040x 2012Www.irs Tax Form 1040ez For 2012How To File Taxes Self EmployedHow To File A 1040ezFree E File Form 48682011 Tax Form 1040 EzFile A 2012 Tax ReturnFile Free Taxes For 2011 No Printing NeededAmended Return Form 1040xHow To File An Amendment For TaxesTax Act Free 2012Federal Income Tax Form 1040ezCan I File A Amended Tax Return Online

2012 Amended Tax Forms

2012 amended tax forms Index A Assistance (see Tax help) B Base amount, Base amount. 2012 amended tax forms C Canadian social security benefits, Canadian or German social security benefits paid to U. 2012 amended tax forms S. 2012 amended tax forms residents. 2012 amended tax forms Children's benefits, Children's benefits. 2012 amended tax forms Comments on publication, Comments and suggestions. 2012 amended tax forms D Deductions related to benefits, Deductions Related to Your Benefits $3,000 or less, Deduction $3,000 or less. 2012 amended tax forms $3,000. 2012 amended tax forms 01 or more, Deduction more than $3,000. 2012 amended tax forms Disability benefits repaid, Disability payments. 2012 amended tax forms E Estimated tax, Tax withholding and estimated tax. 2012 amended tax forms F Form 1040, Reporting on Form 1040. 2012 amended tax forms Form 1040A, Reporting on Form 1040A. 2012 amended tax forms Form RRB-1042S, Form RRB-1042S, Payments by the Railroad Retirement Board 2013 (Nonresident Aliens) Form RRB-1099, Lump-sum payment reported on Form SSA-1099 or RRB-1099. 2012 amended tax forms , Form RRB-1099, Payments by the Railroad Retirement Board 2013 Form SSA-1042S, Form SSA-1042S, Social Security Benefit Statement 2013 (Nonresident Aliens) Form SSA-1099, Lump-sum payment reported on Form SSA-1099 or RRB-1099. 2012 amended tax forms , Appendix Form W-4V, Tax withholding and estimated tax. 2012 amended tax forms Free tax services, Free help with your tax return. 2012 amended tax forms Future developments Product page, Reminders G German social security benefits, Canadian or German social security benefits paid to U. 2012 amended tax forms S. 2012 amended tax forms residents. 2012 amended tax forms H Help (see Tax help) J Joint returns, Joint return. 2012 amended tax forms L Legal expenses, Legal expenses. 2012 amended tax forms Lump-sum election, Lump-Sum Election Example, Example M Missing children, photographs of, Reminders N Nonresident aliens, Nonresident aliens. 2012 amended tax forms Form RRB-1042S, Form RRB-1042S, Payments by the Railroad Retirement Board 2013 (Nonresident Aliens) Form SSA-1042S, Form SSA-1042S, Social Security Benefit Statement 2013 (Nonresident Aliens) Nontaxable benefits, Benefits not taxable. 2012 amended tax forms P Permanent resident aliens, Lawful permanent residents. 2012 amended tax forms Publications (see Tax help) R Railroad retirement benefits, Introduction Repayments Benefits received in earlier year, Repayment of benefits. 2012 amended tax forms , Repayment of benefits received in an earlier year. 2012 amended tax forms Disability benefits, Disability payments. 2012 amended tax forms Gross benefits, Repayment of benefits. 2012 amended tax forms , Repayments More Than Gross Benefits Reporting requirements, How To Report Your Benefits Lump-sum payment, Lump-sum payment reported on Form SSA-1099 or RRB-1099. 2012 amended tax forms S Social Security benefits, Introduction Suggestions for publication, Comments and suggestions. 2012 amended tax forms T Tax help, How To Get Tax Help Taxable benefits Determination of, Are Any of Your Benefits Taxable?, How Much Is Taxable? Maximum taxable part, Maximum taxable part. 2012 amended tax forms Person receiving benefits determines, Who is taxed. 2012 amended tax forms Worksheets, Worksheet A. 2012 amended tax forms Examples, Examples, Worksheets Which to use, Which worksheet to use. 2012 amended tax forms Total income, figuring, Figuring total income. 2012 amended tax forms TTY/TDD information, How To Get Tax Help U U. 2012 amended tax forms S. 2012 amended tax forms citizens residing abroad, U. 2012 amended tax forms S. 2012 amended tax forms citizens residing abroad. 2012 amended tax forms U. 2012 amended tax forms S. 2012 amended tax forms residents Canadian or German social security benefits paid to, Canadian or German social security benefits paid to U. 2012 amended tax forms S. 2012 amended tax forms residents. 2012 amended tax forms W Withholding, Tax withholding and estimated tax. 2012 amended tax forms Exemption from, Exemption from withholding. 2012 amended tax forms Form W-4V, Tax withholding and estimated tax. 2012 amended tax forms Voluntary, Tax withholding and estimated tax. 2012 amended tax forms Worksheets Taxable benefits Blank Worksheet 1, Worksheets Filled-in Worksheet 1, Filled-in Worksheet 1. 2012 amended tax forms Figuring Your Taxable Benefits, Filled-in Worksheet 1. 2012 amended tax forms Figuring Your Taxable Benefits, Filled-in Worksheet 1. 2012 amended tax forms Figuring Your Taxable Benefits, Filled-in Worksheet 1. 2012 amended tax forms Figuring Your Taxable Benefits Quick calculation, sample, Worksheet A. 2012 amended tax forms Prev  Up     Home   More Online Publications
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More Taxpayers Filing from Home Computers in 2014, Many Taxpayers Eligible to Use Free File

IR-2014-28, March 13, 2014

WASHINGTON — More than 27 million taxpayers have filed their tax returns from home computers so far this year, an increase of almost 6 percent compared to last year.

These 27 million taxpayers used a variety of software products to prepare and e-file their own returns. However, the IRS reminds people that they can prepare and e-file their federal tax returns online for free through Free File at IRS.gov. Free File has an option for almost everyone, either through brand-name software or online fillable forms.

The Free File program is a public-private partnership between the IRS and the Free File Alliance, LLC. The Alliance is a consortium of 14 leading tax software providers who make their products available exclusively at IRS.gov. All Free File members meet security requirements and use the latest in encryption technology to protect taxpayer information.

Seventy percent of taxpayers are eligible for easy-to-use Free File software because their income was $58,000 or less in 2013. People who made more than $58,000 and who are comfortable preparing their own returns can use Free File Fillable Forms, the electronic version of IRS paper forms.

Each Free File software provider sets its own criteria for eligibility, generally based on income, age, state residency or military service. However, taxpayers can quickly find a match by using the “help me find Free File software” tool. Or, taxpayers can review all providers and their offers. Some software providers also offer state tax software and display on their landing pages whether it is free or if there is a fee.   

Free File Fillable Forms is more basic, similar to completing a paper Form 1040. The program performs some math calculations and provides links to some IRS publications. It also can be filed electronically for free. However, it does not support any state tax returns.

The total number of individual income tax returns e-filed so far this year is 62.2 million. E-file includes both returns filed from home computers and returns e-filed by professional tax return preparers.  [The filing season statistics table follows.]

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2014 FILING SEASON STATISTICS

Cumulative statistics comparing 3/08/13 and 3/07/14

Individual Income Tax Returns:

2013

2014

% Change

Total Receipts

67,143,000

67,183,000

0.1

Total Processed

60,944,000

65,662,000

 7.7

 

 

 

 

E-filing Receipts:

 

 

 

TOTAL           

61,488,000

62,213,000

1.2

Tax Professionals

35,585,000

34,816,000

-2.2

Self-prepared

25,903,000

27,397,000

5.8

 

 

 

 

Web Usage:

 

 

 

Visits to IRS.gov

197,651,780

181,196,235

-8.3

 

 

 

 

Total Refunds:

 

 

 

Number

53,447,000

55,434,000

3.7

Amount

$154.696

Billion

$164.586

Billion

6.4

Average refund

$2,894

$2,969

2.6

 

 

 

 

Direct Deposit Refunds:

 

 

 

Number

47,177,000

47,976,000

1.7

Amount

$142.861

Billion

$146.305

Billion

2.4

Average refund

$3,028

$3,050

0.7

 

Page Last Reviewed or Updated: 13-Mar-2014

The 2012 Amended Tax Forms

2012 amended tax forms 5. 2012 amended tax forms   Soil and Water Conservation Expenses Table of Contents Introduction Topics - This chapter discusses: Business of Farming Plan Certification Conservation ExpensesWater well. 2012 amended tax forms Assessment by Conservation DistrictAssessment for Depreciable Property 25% Limit on DeductionNet operating loss. 2012 amended tax forms When to Deduct or Capitalize Sale of a Farm Introduction If you are in the business of farming, you can choose to deduct certain expenses for: Soil or water conservation, Prevention of erosion of land used in farming, or Endangered species recovery. 2012 amended tax forms Otherwise, these are capital expenses that must be added to the basis of the land. 2012 amended tax forms (See chapter 6 for information on determining basis. 2012 amended tax forms ) Conservation expenses for land in a foreign country do not qualify for this special treatment. 2012 amended tax forms The deduction for conservation expenses cannot be more than 25% of your gross income from farming. 2012 amended tax forms See 25% Limit on Deduction , later. 2012 amended tax forms Although some expenses are not deductible as soil and water conservation expenses, they may be deductible as ordinary and necessary farm expenses. 2012 amended tax forms These include interest and taxes, the cost of periodically clearing brush from productive land, the regular removal of sediment from a drainage ditch, and expenses paid or incurred primarily to produce an agricultural crop that may also conserve soil. 2012 amended tax forms You must include in income most government payments for approved conservation practices. 2012 amended tax forms However, you can exclude some payments you receive under certain cost-sharing conservation programs. 2012 amended tax forms For more information, see Agricultural Program Payments in chapter 3. 2012 amended tax forms To get the full deduction to which you are entitled, you should maintain your records to clearly distinguish between your ordinary and necessary farm business expenses and your soil and water conservation expenses. 2012 amended tax forms Topics - This chapter discusses: Business of farming Plan certification Conservation expenses Assessment by conservation district 25% limit on deduction When to deduct or capitalize Sale of a farm Business of Farming For purposes of soil and water conservation expenses, you are in the business of farming if you cultivate, operate, or manage a farm for profit, either as an owner or a tenant. 2012 amended tax forms You are not in the business of farming if you cultivate or operate a farm for recreation or pleasure, rather than for profit. 2012 amended tax forms You are not farming if you are engaged only in forestry or the growing of timber. 2012 amended tax forms Farm defined. 2012 amended tax forms   A farm includes livestock, dairy, poultry, fish, fruit, and truck farms. 2012 amended tax forms It also includes plantations, ranches, ranges, and orchards. 2012 amended tax forms A fish farm is an area where fish and other marine animals are grown or raised and artificially fed, protected, etc. 2012 amended tax forms It does not include an area where they are merely caught or harvested. 2012 amended tax forms A plant nursery is a farm for purposes of deducting soil and water conservation expenses. 2012 amended tax forms Farm rental. 2012 amended tax forms   If you own a farm and receive farm rental payments based on farm production, either in cash or crop shares, you are in the business of farming. 2012 amended tax forms If you get cash rental for a farm you own that is not used in farm production, you cannot deduct soil and water conservation expenses for that farm. 2012 amended tax forms   If you receive a fixed rental payment that is not based on farm production, you are in the business of farming only if you materially participate in operating or managing the farm. 2012 amended tax forms Example. 2012 amended tax forms You own a farm in Iowa and live in California. 2012 amended tax forms You rent the farm for $175 in cash per acre and do not materially participate in producing or managing production of the crops grown on the farm. 2012 amended tax forms You cannot deduct your soil conservation expenses for this farm. 2012 amended tax forms You must capitalize the expenses and add them to the basis of the land. 2012 amended tax forms     For more information, see Material participation for landlords under Landlord Participation in Farming in chapter 12. 2012 amended tax forms Plan Certification You can deduct soil and water conservation expenses only if they are consistent with a plan approved by the Natural Resources Conservation Service (NRCS) of the Department of Agriculture. 2012 amended tax forms If no such plan exists, the expenses must be consistent with a soil conservation plan of a comparable state agency. 2012 amended tax forms Keep a copy of the plan with your books and records to support your deductions. 2012 amended tax forms Conservation plan. 2012 amended tax forms   A conservation plan includes the farming conservation practices approved for the area where your farmland is located. 2012 amended tax forms There are three types of approved plans. 2012 amended tax forms NRCS individual site plans. 2012 amended tax forms These plans are issued individually to farmers who request assistance from NRCS to develop a conservation plan designed specifically for their farmland. 2012 amended tax forms NRCS county plans. 2012 amended tax forms These plans include a listing of farm conservation practices approved for the county where the farmland is located. 2012 amended tax forms You can deduct expenses for conservation practices not included on the NRCS county plans only if the practice is a part of an individual site plan. 2012 amended tax forms Comparable state agency plans. 2012 amended tax forms These plans are approved by state agencies and can be approved individual site plans or county plans. 2012 amended tax forms   A list of NRCS conservation programs is available at www. 2012 amended tax forms nrcs. 2012 amended tax forms usda. 2012 amended tax forms gov/programs. 2012 amended tax forms Individual site plans can be obtained from NRCS offices and the comparable state agencies. 2012 amended tax forms Conservation Expenses You can deduct conservation expenses only for land you or your tenant are using, or have used in the past, for farming. 2012 amended tax forms These expenses include, but are not limited to, the following. 2012 amended tax forms The treatment or movement of earth, such as: Leveling, Conditioning, Grading, Terracing, Contour furrowing, and Restoration of soil fertility. 2012 amended tax forms The construction, control, and protection of: Diversion channels, Drainage ditches, Irrigation ditches, Earthen dams, and Watercourses, outlets, and ponds. 2012 amended tax forms The eradication of brush. 2012 amended tax forms The planting of windbreaks. 2012 amended tax forms You cannot deduct expenses to drain or fill wetlands, or to prepare land for center pivot irrigation systems, as soil and water conservation expenses. 2012 amended tax forms These expenses are added to the basis of the land. 2012 amended tax forms If you choose to deduct soil and water conservation expenses, you cannot exclude from gross income any cost-sharing payments you receive for those expenses. 2012 amended tax forms See chapter 3 for information about payments eligible for the cost-sharing exclusion. 2012 amended tax forms New farm or farmland. 2012 amended tax forms   If you acquire a new farm or new farmland from someone who was using it in farming immediately before you acquired the land, soil and water conservation expenses you incur on it will be treated as made on land used in farming at the time the expenses were paid or incurred. 2012 amended tax forms You can deduct soil and water conservation expenses for this land if your use of it is substantially a continuation of its use in farming. 2012 amended tax forms The new farming activity does not have to be the same as the old farming activity. 2012 amended tax forms For example, if you buy land that was used for grazing cattle and then prepare it for use as an apple orchard, you can deduct your conservation expenses. 2012 amended tax forms Land not used for farming. 2012 amended tax forms   If your conservation expenses benefit both land that does not qualify as land used for farming and land that does qualify, you must allocate the expenses between the two types of land. 2012 amended tax forms For example, if the expenses benefit 200 acres of your land, but only 120 acres of this land are used for farming, then you can deduct 60% (120 ÷ 200) of the expenses. 2012 amended tax forms You can use another method to allocate these expenses if you can clearly show that your method is more reasonable. 2012 amended tax forms Depreciable conservation assets. 2012 amended tax forms   You generally cannot deduct your expenses for depreciable conservation assets. 2012 amended tax forms However, you can deduct certain amounts you pay or incur for an assessment for depreciable property that a soil and water conservation or drainage district levies against your farm. 2012 amended tax forms See Assessment for Depreciable Property , later. 2012 amended tax forms   You must capitalize expenses to buy, build, install, or improve depreciable structures or facilities. 2012 amended tax forms These expenses include those for materials, supplies, wages, fuel, hauling, and moving dirt when making structures such as tanks, reservoirs, pipes, culverts, canals, dams, wells, or pumps composed of masonry, concrete, tile, metal, or wood. 2012 amended tax forms You recover your capital investment through annual allowances for depreciation. 2012 amended tax forms   You can deduct soil and water conservation expenses for nondepreciable earthen items. 2012 amended tax forms Nondepreciable earthen items include certain dams, ponds, and terraces described under Property Having a Determinable Useful Life in chapter 7. 2012 amended tax forms Water well. 2012 amended tax forms   You cannot deduct the cost of drilling a water well for irrigation and other agricultural purposes as a soil and water conservation expense. 2012 amended tax forms It is a capital expense. 2012 amended tax forms You recover your cost through depreciation. 2012 amended tax forms You also must capitalize your cost for drilling a test hole. 2012 amended tax forms If the test hole produces no water and you continue drilling, the cost of the test hole is added to the cost of the producing well. 2012 amended tax forms You can recover the total cost through depreciation deductions. 2012 amended tax forms   If a test hole, dry hole, or dried-up well (resulting from prolonged lack of rain, for instance) is abandoned, you can deduct your unrecovered cost in the year of abandonment. 2012 amended tax forms Abandonment means that all economic benefits from the well are terminated. 2012 amended tax forms For example, filling or sealing a well excavation or casing so that all economic benefits from the well are terminated constitutes an abandonment. 2012 amended tax forms Endangered species recovery expenses. 2012 amended tax forms   If you are in the business of farming and meet other specific requirements, you can choose to deduct the conservation expenses discussed earlier as endangered species recovery expenses. 2012 amended tax forms Otherwise, these are capital expenses that must be added to the basis of the land. 2012 amended tax forms   The expenses must be paid or incurred for the purpose of achieving site-specific management actions recommended in a recovery plan approved under section 4(f) of the Endangered Species Act of 1973. 2012 amended tax forms See Internal Revenue Code section 175 for more information. 2012 amended tax forms Assessment by Conservation District In some localities, a soil or water conservation or drainage district incurs expenses for soil or water conservation and levies an assessment against the farmers who benefit from the expenses. 2012 amended tax forms You can deduct as a conservation expense amounts you pay or incur for the part of an assessment that: Covers expenses you could deduct if you had paid them directly, or Covers expenses for depreciable property used in the district's business. 2012 amended tax forms Assessment for Depreciable Property You generally can deduct as a conservation expense amounts you pay or incur for the part of a conservation or drainage district assessment that covers expenses for depreciable property. 2012 amended tax forms This includes items such as pumps, locks, concrete structures (including dams and weir gates), draglines, and similar equipment. 2012 amended tax forms The depreciable property must be used in the district's soil and water conservation activities. 2012 amended tax forms However, the following limits apply to these assessments. 2012 amended tax forms The total assessment limit. 2012 amended tax forms The yearly assessment limit. 2012 amended tax forms After you apply these limits, the amount you can deduct is added to your other conservation expenses for the year. 2012 amended tax forms The total for these expenses is then subject to the 25% of gross income from farming limit on the deduction, discussed later. 2012 amended tax forms See Table 5-1 for a brief summary of these limits. 2012 amended tax forms Table 5-1. 2012 amended tax forms Limits on Deducting an Assessment by a Conservation District for Depreciable Property Total Limit on Deduction for Assessment for Depreciable Property Yearly Limit on Deduction for Assessment for Depreciable Property Yearly Limit for All Conservation Expenses 10% of: $500 + 10% of: 25% of: Total assessment against all members of the district for the property. 2012 amended tax forms Your deductible share of the cost to the district for the property. 2012 amended tax forms Your gross income from farming. 2012 amended tax forms No one taxpayer can deduct more than 10% of the total assessment. 2012 amended tax forms Any amount over 10% is a capital expense and is added to the basis of your land. 2012 amended tax forms If an assessment is paid in installments, each payment must be prorated between the conservation expense and the capital expense. 2012 amended tax forms If the amount you pay or incur for any year is more than the limit, you can deduct for that year only 10% of your deductible share of the cost. 2012 amended tax forms You can deduct the remainder in equal amounts over the next 9 tax years. 2012 amended tax forms Limit for all conservation expenses, including assessments for depreciable property. 2012 amended tax forms Amounts greater than 25% can be carried to the following year and added to that year's expenses. 2012 amended tax forms The total is then subject to the 25% of gross income from farming limit in that year. 2012 amended tax forms To ensure your deduction is within the deduction limits, keep records to show the following. 2012 amended tax forms The total assessment against all members of the district for the depreciable property. 2012 amended tax forms Your deductible share of the cost to the district for the depreciable property. 2012 amended tax forms Your gross income from farming. 2012 amended tax forms Total assessment limit. 2012 amended tax forms   You cannot deduct more than 10% of the total amount assessed to all members of the conservation or drainage district for the depreciable property. 2012 amended tax forms This applies whether you pay the assessment in one payment or in installments. 2012 amended tax forms If your assessment is more than 10% of the total amount assessed, both the following rules apply. 2012 amended tax forms The amount over 10% is a capital expense and is added to the basis of your land. 2012 amended tax forms If the assessment is paid in installments, each payment must be prorated between the conservation expense and the capital expense. 2012 amended tax forms Yearly assessment limit. 2012 amended tax forms   The maximum amount you can deduct in any one year is the total of 10% of your deductible share of the cost as explained earlier, plus $500. 2012 amended tax forms If the amount you pay or incur is equal to or less than the maximum amount, you can deduct it in the year it is paid or incurred. 2012 amended tax forms If the amount you pay or incur is more, you can deduct in that year only 10% of your deductible share of the cost. 2012 amended tax forms You can deduct the remainder in equal amounts over the next 9 tax years. 2012 amended tax forms Your total conservation expense deduction for each year is also subject to the 25% of gross income from farming limit on the deduction, discussed later. 2012 amended tax forms Example 1. 2012 amended tax forms This year, the soil conservation district levies and you pay an assessment of $2,400 against your farm. 2012 amended tax forms Of the assessment, $1,500 is for digging drainage ditches. 2012 amended tax forms You can deduct this part as a soil or conservation expense as if you had paid it directly. 2012 amended tax forms The remaining $900 is for depreciable equipment to be used in the district's irrigation activities. 2012 amended tax forms The total amount assessed by the district against all its members for the depreciable equipment is $7,000. 2012 amended tax forms The total amount you can deduct for the depreciable equipment is limited to 10% of the total amount assessed by the district against all its members for depreciable equipment, or $700. 2012 amended tax forms The $200 excess ($900 − $700) is a capital expense you must add to the basis of your farm. 2012 amended tax forms To figure the maximum amount you can deduct for the depreciable equipment this year, multiply your deductible share of the total assessment ($700) by 10%. 2012 amended tax forms Add $500 to the result for a total of $570. 2012 amended tax forms Your deductible share, $700, is greater than the maximum amount deductible in one year, so you can deduct only $70 of the amount you paid or incurred for depreciable property this year (10% of $700). 2012 amended tax forms You can deduct the balance at the rate of $70 a year over the next 9 years. 2012 amended tax forms You add $70 to the $1,500 portion of the assessment for drainage ditches. 2012 amended tax forms You can deduct $1,570 of the $2,400 assessment as a soil and water conservation expense this year, subject to the 25% of gross income from farming limit on the deduction, discussed later. 2012 amended tax forms Example 2. 2012 amended tax forms Assume the same facts in Example 1 except that $1,850 of the $2,400 assessment is for digging drainage ditches and $550 is for depreciable equipment. 2012 amended tax forms The total amount assessed by the district against all its members for depreciable equipment is $5,500. 2012 amended tax forms The total amount you can deduct for the depreciable equipment is limited to 10% of this amount, or $550. 2012 amended tax forms The maximum amount you can deduct this year for the depreciable equipment is $555 (10% of your deductible share of the total assessment, $55, plus $500). 2012 amended tax forms Since your deductible share is less than the maximum amount deductible in one year, you can deduct the entire $550 this year. 2012 amended tax forms You can deduct the entire assessment, $2,400, as a soil and water conservation expense this year, subject to the 25% of gross income from farming limit on the deduction, discussed below. 2012 amended tax forms Sale or other disposal of land during 9-year period. 2012 amended tax forms   If you dispose of the land during the 9-year period for deducting conservation expenses subject to the yearly limit, any amounts you have not yet deducted because of this limit are added to the basis of the property. 2012 amended tax forms Death of farmer during 9-year period. 2012 amended tax forms   If a farmer dies during the 9-year period, any remaining amounts not yet deducted are deducted in the year of death. 2012 amended tax forms 25% Limit on Deduction The total deduction for conservation expenses in any tax year is limited to 25% of your gross income from farming for the year. 2012 amended tax forms Gross income from farming. 2012 amended tax forms   Gross income from farming is the income you derive in the business of farming from the production of crops, fish, fruits, other agricultural products, or livestock. 2012 amended tax forms Gains from sales of draft, breeding, or dairy livestock are included. 2012 amended tax forms Gains from sales of assets such as farm machinery, or from the disposition of land, are not included. 2012 amended tax forms Carryover of deduction. 2012 amended tax forms   If your deductible conservation expenses in any year are more than 25% of your gross income from farming for that year, you can carry the unused deduction over to later years. 2012 amended tax forms However, the deduction in any later year is limited to 25% of the gross income from farming for that year as well. 2012 amended tax forms Example. 2012 amended tax forms In 2012, you have gross income of $32,000 from two farms. 2012 amended tax forms During the year, you incurred $10,000 of deductible soil and water conservation expenses for one of the farms. 2012 amended tax forms However, your deduction is limited to 25% of $32,000, or $8,000. 2012 amended tax forms The $2,000 excess ($10,000 − $8,000) is carried over to 2013 and added to deductible soil and water conservation expenses made in that year. 2012 amended tax forms The total of the 2012 carryover plus 2013 expenses is deductible in 2013, subject to the limit of 25% of your gross income from farming in 2013. 2012 amended tax forms Any expenses over the limit in that year are carried to 2014 and later years. 2012 amended tax forms Net operating loss. 2012 amended tax forms   The deduction for soil and water conservation expenses, after applying the 25% limit, is included when figuring a net operating loss (NOL) for the year. 2012 amended tax forms If the NOL is carried to another year, the soil and water conservation deduction included in the NOL is not subject to the 25% limit in the year to which it is carried. 2012 amended tax forms When to Deduct or Capitalize If you choose to deduct soil and water conservation expenses, you must deduct the total allowable amount on your tax return for the first year you pay or incur these expenses. 2012 amended tax forms If you do not choose to deduct the expenses, you must capitalize them. 2012 amended tax forms Change of method. 2012 amended tax forms   If you want to change your method for the treatment of soil and water conservation expenses, or you want to treat the expenses for a particular project or a single farm in a different manner, you must get the approval of the IRS. 2012 amended tax forms To get this approval, submit a written request by the due date of your return for the first tax year you want the new method to apply. 2012 amended tax forms You or your authorized representative must sign the request. 2012 amended tax forms   The request must include the following information. 2012 amended tax forms Your name and address. 2012 amended tax forms The first tax year the method or change of method is to apply. 2012 amended tax forms Whether the method or change of method applies to all your soil and water conservation expenses or only to those for a particular project or farm. 2012 amended tax forms If the method or change of method does not apply to all your expenses, identify the project or farm to which the expenses apply. 2012 amended tax forms The total expenses you paid or incurred in the first tax year the method or change of method is to apply. 2012 amended tax forms A statement that you will account separately in your books for the expenses to which this method or change of method relates. 2012 amended tax forms Send your request to the following  address. 2012 amended tax forms  Department of the Treasury Internal Revenue Service Center Cincinnati, OH 45999  For more information, see Change in  Accounting Method in chapter 2. 2012 amended tax forms Sale of a Farm If you sell your farm, you cannot adjust the basis of the land at the time of the sale for any unused carryover of soil and water conservation expenses (except for deductions of assessments for depreciable property, discussed earlier). 2012 amended tax forms However, if you acquire another farm and return to the business of farming, you can start taking deductions again for the unused carryovers. 2012 amended tax forms Gain on sale of farmland. 2012 amended tax forms   If you held the land 5 years or less before you sold it, gain on the sale of the land is treated as ordinary income up to the amount you previously deducted for soil and water conservation expenses. 2012 amended tax forms If you held the land less than 10 but more than 5 years, the gain is treated as ordinary income up to a specified percentage of the previous deductions. 2012 amended tax forms See Section 1252 property under Other Gains in chapter 9. 2012 amended tax forms Prev  Up  Next   Home   More Online Publications