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Amend 2012 Tax Return

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Amend 2012 Tax Return

Amend 2012 tax return 4. Amend 2012 tax return   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. Amend 2012 tax return Resident aliens are generally taxed in the same way as U. Amend 2012 tax return S. Amend 2012 tax return citizens. Amend 2012 tax return Nonresident aliens are taxed based on the source of their income and whether or not their income is effectively connected with a U. Amend 2012 tax return S. Amend 2012 tax return trade or business. Amend 2012 tax return The following discussions will help you determine if income you receive during the tax year is effectively connected with a U. Amend 2012 tax return S. Amend 2012 tax return trade or business and how it is taxed. Amend 2012 tax return Topics - This chapter discusses: Income that is effectively connected with a U. Amend 2012 tax return S. Amend 2012 tax return trade or business. Amend 2012 tax return Income that is not effectively connected with a U. Amend 2012 tax return S. Amend 2012 tax return trade or business. Amend 2012 tax return Interrupted period of residence. Amend 2012 tax return Expatriation tax. Amend 2012 tax return 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. Amend 2012 tax return Resident Aliens Resident aliens are generally taxed in the same way as U. Amend 2012 tax return S. Amend 2012 tax return citizens. Amend 2012 tax return This means that their worldwide income is subject to U. Amend 2012 tax return S. Amend 2012 tax return tax and must be reported on their U. Amend 2012 tax return S. Amend 2012 tax return tax return. Amend 2012 tax return Income of resident aliens is subject to the graduated tax rates that apply to U. Amend 2012 tax return S. Amend 2012 tax return citizens. Amend 2012 tax return Resident aliens use the Tax Table or Tax Computation Worksheets located in the Form 1040 instructions, which apply to U. Amend 2012 tax return S. Amend 2012 tax return citizens. Amend 2012 tax return Nonresident Aliens A nonresident alien's income that is subject to U. Amend 2012 tax return S. Amend 2012 tax return 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). Amend 2012 tax return The difference between these two categories is that effectively connected income, after allowable deductions, is taxed at graduated rates. Amend 2012 tax return These are the same rates that apply to U. Amend 2012 tax return S. Amend 2012 tax return citizens and residents. Amend 2012 tax return Income that is not effectively connected is taxed at a flat 30% (or lower treaty) rate. Amend 2012 tax return If you were formerly a U. Amend 2012 tax return S. Amend 2012 tax return citizen or resident alien, these rules may not apply. Amend 2012 tax return See Expatriation Tax, later, in this chapter. Amend 2012 tax return 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. Amend 2012 tax return Whether you are engaged in a trade or business in the United States depends on the nature of your activities. Amend 2012 tax return The discussions that follow will help you determine whether you are engaged in a trade or business in the United States. Amend 2012 tax return 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. Amend 2012 tax return Certain compensation paid to a nonresident alien by a foreign employer is not included in gross income. Amend 2012 tax return For more information, see Services Performed for Foreign Employer in chapter 3. Amend 2012 tax return Other Trade or Business Activities Other examples of being engaged in a trade or business in the United States follow. Amend 2012 tax return Students and trainees. Amend 2012 tax return   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. Amend 2012 tax return 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. Amend 2012 tax return The taxable part of any scholarship or fellowship grant that is U. Amend 2012 tax return S. Amend 2012 tax return source income is treated as effectively connected with a trade or business in the United States. Amend 2012 tax return Business operations. Amend 2012 tax return   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. Amend 2012 tax return Partnerships. Amend 2012 tax return   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. Amend 2012 tax return Beneficiary of an estate or trust. Amend 2012 tax return   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. Amend 2012 tax return Trading in stocks, securities, and commodities. Amend 2012 tax return   If your only U. Amend 2012 tax return S. Amend 2012 tax return business activity is trading in stocks, securities, or commodities (including hedging transactions) through a U. Amend 2012 tax return S. Amend 2012 tax return resident broker or other agent, you are not engaged in a trade or business in the United States. Amend 2012 tax return   For transactions in stocks or securities, this applies to any nonresident alien, including a dealer or broker in stocks and securities. Amend 2012 tax return   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. Amend 2012 tax return   This discussion does not apply if you have a U. Amend 2012 tax return S. Amend 2012 tax return 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. Amend 2012 tax return Trading for a nonresident alien's own account. Amend 2012 tax return   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. Amend 2012 tax return S. Amend 2012 tax return business activity. Amend 2012 tax return 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. Amend 2012 tax return   This does not apply to trading for your own account if you are a dealer in stocks, securities, or commodities. Amend 2012 tax return 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. Amend 2012 tax return Determine that based on the facts and circumstances in each case or under the rules given above in Trading in stocks, securities, and commodities . Amend 2012 tax return Effectively Connected Income If you are engaged in a U. Amend 2012 tax return S. Amend 2012 tax return 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. Amend 2012 tax return 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. Amend 2012 tax return 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. Amend 2012 tax return In limited circumstances, some kinds of foreign source income may be treated as effectively connected with a trade or business in the United States. Amend 2012 tax return For a discussion of these rules, see Foreign Income , later. Amend 2012 tax return Investment Income Investment income from U. Amend 2012 tax return S. Amend 2012 tax return sources that may or may not be treated as effectively connected with a U. Amend 2012 tax return S. Amend 2012 tax return trade or business generally falls into the following three categories. Amend 2012 tax return Fixed or determinable income (interest, dividends, rents, royalties, premiums, annuities, etc. Amend 2012 tax return ). Amend 2012 tax return Gains (some of which are considered capital gains) from the sale or exchange of the following types of property. Amend 2012 tax return Timber, coal, or domestic iron ore with a retained economic interest. Amend 2012 tax return Patents, copyrights, and similar property on which you receive contingent payments after October 4, 1966. Amend 2012 tax return Patents transferred before October 5, 1966. Amend 2012 tax return Original issue discount obligations. Amend 2012 tax return Capital gains (and losses). Amend 2012 tax return Use the two tests, described next, to determine whether an item of U. Amend 2012 tax return S. Amend 2012 tax return source income falling in one of the three categories above and received during the tax year is effectively connected with your U. Amend 2012 tax return S. Amend 2012 tax return trade or business. Amend 2012 tax return If the tests indicate that the item of income is effectively connected, you must include it with your other effectively connected income. Amend 2012 tax return If the item of income is not effectively connected, include it with all other income discussed under The 30% Tax later, in this chapter. Amend 2012 tax return Asset-use test. Amend 2012 tax return   This test usually applies to income that is not directly produced by trade or business activities. Amend 2012 tax return 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. Amend 2012 tax return   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. Amend 2012 tax return 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. Amend 2012 tax return Business-activities test. Amend 2012 tax return   This test usually applies when income, gain, or loss comes directly from the active conduct of the trade or business. Amend 2012 tax return 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. Amend 2012 tax return Under this test, if the conduct of the U. Amend 2012 tax return S. Amend 2012 tax return trade or business was a material factor in producing the income, the income is considered effectively connected. Amend 2012 tax return Personal Service Income You usually are engaged in a U. Amend 2012 tax return S. Amend 2012 tax return trade or business when you perform personal services in the United States. Amend 2012 tax return Personal service income you receive in a tax year in which you are engaged in a U. Amend 2012 tax return S. Amend 2012 tax return trade or business is effectively connected with a U. Amend 2012 tax return S. Amend 2012 tax return trade or business. Amend 2012 tax return 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. Amend 2012 tax return Personal service income includes wages, salaries, commissions, fees, per diem allowances, and employee allowances and bonuses. Amend 2012 tax return The income may be paid to you in the form of cash, services, or property. Amend 2012 tax return If you are engaged in a U. Amend 2012 tax return S. Amend 2012 tax return 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. Amend 2012 tax return 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. Amend 2012 tax return Pensions. Amend 2012 tax return   If you were a nonresident alien engaged in a U. Amend 2012 tax return S. Amend 2012 tax return 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. Amend 2012 tax return This is true whether or not you are engaged in a U. Amend 2012 tax return S. Amend 2012 tax return trade or business in the year you receive the retirement pay. Amend 2012 tax return Transportation Income Transportation income (defined in chapter 2) is effectively connected if you meet both of the following conditions. Amend 2012 tax return You had a fixed place of business in the United States involved in earning the income. Amend 2012 tax return At least 90% of your U. Amend 2012 tax return S. Amend 2012 tax return source transportation income is attributable to regularly scheduled transportation. Amend 2012 tax return “Fixed place of business” generally means a place, site, structure, or other similar facility through which you engage in a trade or business. Amend 2012 tax return “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. Amend 2012 tax return This definition applies to both scheduled and chartered air transportation. Amend 2012 tax return If you do not meet the two conditions above, the income is not effectively connected and is taxed at a 4% rate. Amend 2012 tax return See Transportation Tax, later, in this chapter. Amend 2012 tax return Business Profits and Losses and Sales Transactions All profits or losses from U. Amend 2012 tax return S. Amend 2012 tax return 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. Amend 2012 tax return 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. Amend 2012 tax return A share of U. Amend 2012 tax return S. Amend 2012 tax return 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. Amend 2012 tax return Real Property Gain or Loss Gains and losses from the sale or exchange of U. Amend 2012 tax return S. Amend 2012 tax return 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. Amend 2012 tax return You must treat the gain or loss as effectively connected with that trade or business. Amend 2012 tax return U. Amend 2012 tax return S. Amend 2012 tax return real property interest. Amend 2012 tax return   This is any interest in real property located in the United States or the U. Amend 2012 tax return S. Amend 2012 tax return Virgin Islands or any interest (other than as a creditor) in a domestic corporation that is a U. Amend 2012 tax return S. Amend 2012 tax return real property holding corporation. Amend 2012 tax return Real property includes the following. Amend 2012 tax return Land and unsevered natural products of the land, such as growing crops and timber, and mines, wells, and other natural deposits. Amend 2012 tax return Improvements on land, including buildings, other permanent structures, and their structural components. Amend 2012 tax return 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. Amend 2012 tax return U. Amend 2012 tax return S. Amend 2012 tax return real property holding corporation. Amend 2012 tax return   A corporation is a U. Amend 2012 tax return S. Amend 2012 tax return real property holding corporation if the fair market value of the corporation's U. Amend 2012 tax return S. Amend 2012 tax return real property interests are at least 50% of the total fair market value of: The corporation's U. Amend 2012 tax return S. Amend 2012 tax return 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. Amend 2012 tax return   Gain or loss on the sale of the stock in any domestic corporation is taxed as if you are engaged in a U. Amend 2012 tax return S. Amend 2012 tax return trade or business unless you establish that the corporation is not a U. Amend 2012 tax return S. Amend 2012 tax return real property holding corporation. Amend 2012 tax return   A U. Amend 2012 tax return S. Amend 2012 tax return 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. Amend 2012 tax return An interest in a foreign corporation owning U. Amend 2012 tax return S. Amend 2012 tax return real property generally is not a U. Amend 2012 tax return S. Amend 2012 tax return real property interest unless the corporation chooses to be treated as a domestic corporation. Amend 2012 tax return Qualified investment entities. Amend 2012 tax return   Special rules apply to qualified investment entities (QIEs). Amend 2012 tax return A QIE is any real estate investment trust (REIT) or any regulated investment company (RIC) that is a U. Amend 2012 tax return S. Amend 2012 tax return real property holding corporation. Amend 2012 tax return    Generally, any distribution from a QIE to a shareholder that is attributable to gain from the sale or exchange of a U. Amend 2012 tax return S. Amend 2012 tax return real property interest is treated as a U. Amend 2012 tax return S. Amend 2012 tax return real property gain by the shareholder receiving the distribution. Amend 2012 tax return 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. Amend 2012 tax return S. Amend 2012 tax return 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. Amend 2012 tax return A distribution that you do not treat as gain from the sale or exchange of a U. Amend 2012 tax return S. Amend 2012 tax return real property interest is included in your gross income as a regular dividend. Amend 2012 tax return Note. Amend 2012 tax return Beginning January 1, 2014 (unless extended by legislation), a RIC that is a U. Amend 2012 tax return S. Amend 2012 tax return 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. Amend 2012 tax return Domestically controlled QIE. Amend 2012 tax return   The sale of an interest in a domestically controlled QIE is not the sale of a U. Amend 2012 tax return S. Amend 2012 tax return real property interest. Amend 2012 tax return 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. Amend 2012 tax return 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. Amend 2012 tax return Wash sale. Amend 2012 tax return    If you dispose of an interest in a domestically controlled QIE in an applicable wash sale transaction, special rules apply. Amend 2012 tax return 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. Amend 2012 tax return S. Amend 2012 tax return 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. Amend 2012 tax return If this occurs, you are treated as having gain from the sale or exchange of a U. Amend 2012 tax return S. Amend 2012 tax return real property interest in an amount equal to the distribution made after June 15, 2006, that would have been treated as such gain. Amend 2012 tax return This also applies to any substitute dividend payment. Amend 2012 tax return   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. Amend 2012 tax return Alternative minimum tax. Amend 2012 tax return   There may be a minimum tax on your net gain from the disposition of U. Amend 2012 tax return S. Amend 2012 tax return real property interests. Amend 2012 tax return Figure the amount of this tax, if any, on Form 6251. Amend 2012 tax return Withholding of tax. Amend 2012 tax return   If you dispose of a U. Amend 2012 tax return S. Amend 2012 tax return real property interest, the buyer may have to withhold tax. Amend 2012 tax return See the discussion of Tax Withheld on Real Property Sales in chapter 8. Amend 2012 tax return 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. Amend 2012 tax return 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. Amend 2012 tax return The three kinds of foreign source income are listed below. Amend 2012 tax return 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. Amend 2012 tax return 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. Amend 2012 tax return 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. Amend 2012 tax return 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. Amend 2012 tax return Income, gain, or loss from the sale outside the United States, through the U. Amend 2012 tax return S. Amend 2012 tax return 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. Amend 2012 tax return 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. Amend 2012 tax return Any foreign source income that is equivalent to any item of income described above is treated as effectively connected with a U. Amend 2012 tax return S. Amend 2012 tax return trade or business. Amend 2012 tax return For example, foreign source interest and dividend equivalents are treated as U. Amend 2012 tax return S. Amend 2012 tax return 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. Amend 2012 tax return 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. Amend 2012 tax return S. Amend 2012 tax return citizens and residents. Amend 2012 tax return 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. Amend 2012 tax return 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. Amend 2012 tax return Example. Amend 2012 tax return Ted Richards, a nonresident alien, entered the United States in August 2012, to perform personal services in the U. Amend 2012 tax return S. Amend 2012 tax return office of his overseas employer. Amend 2012 tax return He worked in the U. Amend 2012 tax return S. Amend 2012 tax return office until December 25, 2012, but did not leave this country until January 11, 2013. Amend 2012 tax return On January 8, 2013, he received his final paycheck for services performed in the United States during 2012. Amend 2012 tax return All of Ted's income during his stay here is U. Amend 2012 tax return S. Amend 2012 tax return source income. Amend 2012 tax return During 2012, Ted was engaged in the trade or business of performing personal services in the United States. Amend 2012 tax return 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. Amend 2012 tax return The salary payment Ted received in January 2013 is U. Amend 2012 tax return S. Amend 2012 tax return source income to him in 2013. Amend 2012 tax return 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. Amend 2012 tax return Real property income. Amend 2012 tax return   You may be able to choose to treat all income from real property as effectively connected. Amend 2012 tax return See Income From Real Property , later, in this chapter. Amend 2012 tax return The 30% Tax Tax at a 30% (or lower treaty) rate applies to certain items of income or gains from U. Amend 2012 tax return S. Amend 2012 tax return sources but only if the items are not effectively connected with your U. Amend 2012 tax return S. Amend 2012 tax return trade or business. Amend 2012 tax return Fixed or Determinable Income The 30% (or lower treaty) rate applies to the gross amount of U. Amend 2012 tax return S. Amend 2012 tax return source fixed or determinable annual or periodic gains, profits, or income. Amend 2012 tax return Income is fixed when it is paid in amounts known ahead of time. Amend 2012 tax return Income is determinable whenever there is a basis for figuring the amount to be paid. Amend 2012 tax return Income can be periodic if it is paid from time to time. Amend 2012 tax return It does not have to be paid annually or at regular intervals. Amend 2012 tax return Income can be determinable or periodic even if the length of time during which the payments are made is increased or decreased. Amend 2012 tax return 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. Amend 2012 tax return 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. Amend 2012 tax return Other items of income, such as royalties, also may be subject to the 30% tax. Amend 2012 tax return Some fixed or determinable income may be exempt from U. Amend 2012 tax return S. Amend 2012 tax return tax. Amend 2012 tax return See chapter 3 if you are not sure whether the income is taxable. Amend 2012 tax return Original issue discount (OID). Amend 2012 tax return   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. Amend 2012 tax return The amount of OID is the difference between the stated redemption price at maturity and the issue price of the debt instrument. Amend 2012 tax return The 30% tax applies in the following circumstances. Amend 2012 tax return You received a payment on a debt instrument. Amend 2012 tax return 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. Amend 2012 tax return But the tax on the OID cannot be more than the payment minus the tax on the interest payment on the debt instrument. Amend 2012 tax return You sold or exchanged the debt instrument. Amend 2012 tax return 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. Amend 2012 tax return   Report on your return the amount of OID shown on Form 1042-S, Foreign Person's U. Amend 2012 tax return S. Amend 2012 tax return Source Income Subject to Withholding, if you bought the debt instrument at original issue. Amend 2012 tax return However, you must recompute your proper share of OID shown on Form 1042-S if any of the following apply. Amend 2012 tax return You bought the debt instrument at a premium or paid an acquisition premium. Amend 2012 tax return The debt instrument is a stripped bond or a stripped coupon (including zero coupon instruments backed by U. Amend 2012 tax return S. Amend 2012 tax return Treasury securities). Amend 2012 tax return The debt instrument is a contingent payment or inflation-indexed debt instrument. Amend 2012 tax return For the definition of premium and acquisition premium and instructions on how to recompute OID, get Publication 1212. Amend 2012 tax return   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. Amend 2012 tax return See chapter 12. Amend 2012 tax return 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. Amend 2012 tax return S. Amend 2012 tax return trade or business and is not exempted by treaty. Amend 2012 tax return 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. Amend 2012 tax return Nonresident aliens are taxed at graduated rates on net gambling income won in the United States that is effectively connected with a U. Amend 2012 tax return S. Amend 2012 tax return trade or business. Amend 2012 tax return Social Security Benefits A nonresident alien must include 85% of any U. Amend 2012 tax return S. Amend 2012 tax return social security benefit (and the social security equivalent part of a tier 1 railroad retirement benefit) in U. Amend 2012 tax return S. Amend 2012 tax return source fixed or determinable annual or periodic income. Amend 2012 tax return Social security benefits include monthly retirement, survivor, and disability benefits. Amend 2012 tax return This income is exempt under some tax treaties. Amend 2012 tax return See Table 1 in Publication 901, U. Amend 2012 tax return S. Amend 2012 tax return Tax Treaties, for a list of tax treaties that exempt U. Amend 2012 tax return S. Amend 2012 tax return social security benefits from U. Amend 2012 tax return S. Amend 2012 tax return tax. Amend 2012 tax return 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. Amend 2012 tax return They apply even if you are engaged in a trade or business in the United States. Amend 2012 tax return These rules do not apply to the sale or exchange of a U. Amend 2012 tax return S. Amend 2012 tax return real property interest or to the sale of any property that is effectively connected with a trade or business in the United States. Amend 2012 tax return See Real Property Gain or Loss , earlier, under Effectively Connected Income. Amend 2012 tax return A capital asset is everything you own except: Inventory. Amend 2012 tax return Business accounts or notes receivable. Amend 2012 tax return Depreciable property used in a trade or business. Amend 2012 tax return Real property used in a trade or business. Amend 2012 tax return Supplies regularly used in a trade or business. Amend 2012 tax return Certain copyrights, literary or musical or artistic compositions, letters or memoranda, or similar property. Amend 2012 tax return Certain U. Amend 2012 tax return S. Amend 2012 tax return government publications. Amend 2012 tax return Certain commodities derivative financial instruments held by a commodities derivatives dealer. Amend 2012 tax return Hedging transactions. Amend 2012 tax return A capital gain is a gain on the sale or exchange of a capital asset. Amend 2012 tax return A capital loss is a loss on the sale or exchange of a capital asset. Amend 2012 tax return 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. Amend 2012 tax return S. Amend 2012 tax return currency at the rate of exchange prevailing as of the date of the purchase and date of the sale, respectively. Amend 2012 tax return You may want to read Publication 544. Amend 2012 tax return However, use Publication 544 only to determine what is a sale or exchange of a capital asset, or what is treated as such. Amend 2012 tax return Specific tax treatment that applies to U. Amend 2012 tax return S. Amend 2012 tax return citizens or residents generally does not apply to you. Amend 2012 tax return The following gains are subject to the 30% (or lower treaty) rate without regard to the 183-day rule, discussed later. Amend 2012 tax return Gains on the disposal of timber, coal, or domestic iron ore with a retained economic interest. Amend 2012 tax return Gains on contingent payments received from the sale or exchange of patents, copyrights, and similar property after October 4, 1966. Amend 2012 tax return Gains on certain transfers of all substantial rights to, or an undivided interest in, patents if the transfers were made before October 5, 1966. Amend 2012 tax return Gains on the sale or exchange of original issue discount obligations. Amend 2012 tax return 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. Amend 2012 tax return S. Amend 2012 tax return trade or business. Amend 2012 tax return See Income From Real Property , later. Amend 2012 tax return 183-day rule. Amend 2012 tax return   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. Amend 2012 tax return For purposes of the 30% (or lower treaty) rate, net gain is the excess of your capital gains from U. Amend 2012 tax return S. Amend 2012 tax return sources over your capital losses from U. Amend 2012 tax return S. Amend 2012 tax return sources. Amend 2012 tax return This rule applies even if any of the transactions occurred while you were not in the United States. Amend 2012 tax return   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. Amend 2012 tax return S. Amend 2012 tax return trade or business during the year and the gains and losses were effectively connected with that trade or business during the tax year. Amend 2012 tax return   In arriving at your net gain, do not take the following into consideration. Amend 2012 tax return The four types of gains listed earlier. Amend 2012 tax return The deduction for a capital loss carryover. Amend 2012 tax return Capital losses in excess of capital gains. Amend 2012 tax return Exclusion for gain from the sale or exchange of qualified small business stock (section 1202 exclusion). Amend 2012 tax return Losses from the sale or exchange of property held for personal use. Amend 2012 tax return However, losses resulting from casualties or thefts may be deductible on Schedule A (Form 1040NR). Amend 2012 tax return See Itemized Deductions in chapter 5. Amend 2012 tax return   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. Amend 2012 tax return Also, you must file your tax return on a calendar-year basis. Amend 2012 tax return   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. Amend 2012 tax return Reporting. Amend 2012 tax return   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. Amend 2012 tax return 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. Amend 2012 tax return Attach them to Form 1040NR. Amend 2012 tax return 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. Amend 2012 tax return 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. Amend 2012 tax return This includes income from rents, royalties from mines, oil or gas wells, or other natural resources. Amend 2012 tax return It also includes gains from the sale or exchange of timber, coal, or domestic iron ore with a retained economic interest. Amend 2012 tax return You can make this choice only for real property income that is not otherwise effectively connected with your U. Amend 2012 tax return S. Amend 2012 tax return trade or business. Amend 2012 tax return 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. Amend 2012 tax return This choice does not treat a nonresident alien, who is not otherwise engaged in a U. Amend 2012 tax return S. Amend 2012 tax return trade or business, as being engaged in a trade or business in the United States during the year. Amend 2012 tax return Example. Amend 2012 tax return You are a nonresident alien and are not engaged in a U. Amend 2012 tax return S. Amend 2012 tax return trade or business. Amend 2012 tax return You own a single-family house in the United States that you rent out. Amend 2012 tax return Your rental income for the year is $10,000. Amend 2012 tax return This is your only U. Amend 2012 tax return S. Amend 2012 tax return source income. Amend 2012 tax return As discussed earlier under The 30% Tax, the rental income is subject to a tax at a 30% (or lower treaty) rate. Amend 2012 tax return You received a Form 1042-S showing that your tenants properly withheld this tax from the rental income. Amend 2012 tax return You do not have to file a U. Amend 2012 tax return S. Amend 2012 tax return tax return (Form 1040NR) because your U. Amend 2012 tax return S. Amend 2012 tax return tax liability is satisfied by the withholding of tax. Amend 2012 tax return If you make the choice discussed earlier, you can offset the $10,000 income by certain rental expenses. Amend 2012 tax return (See Publication 527, Residential Rental Property, for information on rental expenses. Amend 2012 tax return ) Any resulting net income is taxed at graduated rates. Amend 2012 tax return If you make this choice, report the rental income and expenses on Schedule E (Form 1040) and attach the schedule to Form 1040NR. Amend 2012 tax return For the first year you make the choice, also attach the statement discussed next. Amend 2012 tax return Making the choice. Amend 2012 tax return   Make the initial choice by attaching a statement to your return, or amended return, for the year of the choice. Amend 2012 tax return Include the following in your statement. Amend 2012 tax return That you are making the choice. Amend 2012 tax return Whether the choice is under Internal Revenue Code section 871(d) (explained earlier) or a tax treaty. Amend 2012 tax return A complete list of all your real property, or any interest in real property, located in the United States. Amend 2012 tax return Give the legal identification of U. Amend 2012 tax return S. Amend 2012 tax return timber, coal, or iron ore in which you have an interest. Amend 2012 tax return The extent of your ownership in the property. Amend 2012 tax return The location of the property. Amend 2012 tax return A description of any major improvements to the property. Amend 2012 tax return The dates you owned the property. Amend 2012 tax return Your income from the property. Amend 2012 tax return Details of any previous choices and revocations of the real property income choice. Amend 2012 tax return   This choice stays in effect for all later tax years unless you revoke it. Amend 2012 tax return Revoking the choice. Amend 2012 tax return   You can revoke the choice without IRS approval by filing Form 1040X, Amended U. Amend 2012 tax return S. Amend 2012 tax return Individual Income Tax Return, for the year you made the choice and for later tax years. Amend 2012 tax return 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. Amend 2012 tax return If this time period has expired for the year of choice, you cannot revoke the choice for that year. Amend 2012 tax return However, you may revoke the choice for later tax years only if you have IRS approval. Amend 2012 tax return For information on how to get IRS approval, see Regulation section 1. Amend 2012 tax return 871-10(d)(2). Amend 2012 tax return 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 . Amend 2012 tax return If you receive transportation income subject to the 4% tax, you should figure the tax and show it on line 57 of Form 1040NR. Amend 2012 tax return Attach a statement to your return that includes the following information (if applicable). Amend 2012 tax return Your name, taxpayer identification number, and tax year. Amend 2012 tax return A description of the types of services performed (whether on or off board). Amend 2012 tax return Names of vessels or registration numbers of aircraft on which you performed the services. Amend 2012 tax return Amount of U. Amend 2012 tax return S. Amend 2012 tax return source transportation income derived from each type of service for each vessel or aircraft for the calendar year. Amend 2012 tax return Total amount of U. Amend 2012 tax return S. Amend 2012 tax return source transportation income derived from all types of services for the calendar year. Amend 2012 tax return This 4% tax applies to your U. Amend 2012 tax return S. Amend 2012 tax return source gross transportation income. Amend 2012 tax return 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. Amend 2012 tax return For transportation income from personal services, the transportation must be between the United States and a U. Amend 2012 tax return S. Amend 2012 tax return possession. Amend 2012 tax return For personal services of a nonresident alien, this only applies to income derived from, or in connection with, an aircraft. Amend 2012 tax return Interrupted Period of Residence You are subject to tax under a special rule if you interrupt your period of U. Amend 2012 tax return S. Amend 2012 tax return residence with a period of nonresidence. Amend 2012 tax return The special rule applies if you meet all of the following conditions. Amend 2012 tax return You were a U. Amend 2012 tax return S. Amend 2012 tax return resident for a period that includes at least 3 consecutive calendar years. Amend 2012 tax return You were a U. Amend 2012 tax return S. Amend 2012 tax return resident for at least 183 days in each of those years. Amend 2012 tax return You ceased to be treated as a U. Amend 2012 tax return S. Amend 2012 tax return resident. Amend 2012 tax return You then again became a U. Amend 2012 tax return S. Amend 2012 tax return resident before the end of the third calendar year after the end of the period described in (1) above. Amend 2012 tax return Under this special rule, you are subject to tax on your U. Amend 2012 tax return S. Amend 2012 tax return 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. Amend 2012 tax return S. Amend 2012 tax return trade or business. Amend 2012 tax return 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. Amend 2012 tax return Example. Amend 2012 tax return John Willow, a citizen of New Zealand, entered the United States on April 1, 2008, as a lawful permanent resident. Amend 2012 tax return On August 1, 2010, John ceased to be a lawful permanent resident and returned to New Zealand. Amend 2012 tax return 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). Amend 2012 tax return He returned to the United States on October 5, 2013, as a lawful permanent resident. Amend 2012 tax return 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). Amend 2012 tax return 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. Amend 2012 tax return Reporting requirements. Amend 2012 tax return   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. Amend 2012 tax return The return is due by the due date (including extensions) for filing your U. Amend 2012 tax return S. Amend 2012 tax return income tax return for the year that you again become a U. Amend 2012 tax return S. Amend 2012 tax return resident. Amend 2012 tax return If you already filed returns for that period, you must file amended returns. Amend 2012 tax return You must attach a statement to your return that identifies the source of all of your U. Amend 2012 tax return S. Amend 2012 tax return and foreign gross income and the items of income subject to this special rule. Amend 2012 tax return Expatriation Tax The expatriation tax provisions apply to U. Amend 2012 tax return S. Amend 2012 tax return citizens who have renounced their citizenship and long-term residents who have ended their residency. Amend 2012 tax return The rules that apply are based on the dates of expatriation, which are described in the following sections. Amend 2012 tax return Expatriation Before June 4, 2004. Amend 2012 tax return Expatriation After June 3, 2004, and Before June 17, 2008. Amend 2012 tax return Expatriation After June 16, 2008. Amend 2012 tax return Long-term resident defined. Amend 2012 tax return   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. Amend 2012 tax return 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. Amend 2012 tax return 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. Amend 2012 tax return S. Amend 2012 tax return taxes. Amend 2012 tax return Unless you received a ruling from the IRS that you did not expatriate to avoid U. Amend 2012 tax return S. Amend 2012 tax return 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. Amend 2012 tax return The amounts above are adjusted for inflation if your expatriation action is after 1997 (see Table 4-1). Amend 2012 tax return Table 4-1. Amend 2012 tax return Inflation-Adjusted Amounts for Expatriation Actions Before June 4, 2004 IF you expatriated during . Amend 2012 tax return . Amend 2012 tax return . Amend 2012 tax return   THEN the rules outlined on this page apply if . Amend 2012 tax return . Amend 2012 tax return . Amend 2012 tax return     Your 5-year average annual net income tax was more than . Amend 2012 tax return . Amend 2012 tax return . Amend 2012 tax return OR Your net worth equaled or exceeded . Amend 2012 tax return . Amend 2012 tax return . Amend 2012 tax return 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. Amend 2012 tax return Reporting requirements. Amend 2012 tax return   If you lost your U. Amend 2012 tax return S. Amend 2012 tax return citizenship, you should have filed Form 8854 with a consular office or a federal court at the time of loss of citizenship. Amend 2012 tax return 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. Amend 2012 tax return   Your U. Amend 2012 tax return S. Amend 2012 tax return 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. Amend 2012 tax return Penalties. Amend 2012 tax return   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. Amend 2012 tax return 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. Amend 2012 tax return The penalty will not be imposed if you can show that the failure is due to reasonable cause and not willful neglect. Amend 2012 tax return Expatriation tax. Amend 2012 tax return   The expatriation tax applies to the 10-year period following the date of expatriation or termination of residency. Amend 2012 tax return It is figured in the same way as for those expatriating after June 3, 2004, and before June 17, 2008. Amend 2012 tax return See How To Figure the Expatriation Tax (If You Expatriated Before June 17, 2008) in the next section. Amend 2012 tax return 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. Amend 2012 tax return 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. Amend 2012 tax return $127,000 if you expatriated or terminated residency in 2005. Amend 2012 tax return $131,000 if you expatriated or terminated residency in 2006. Amend 2012 tax return $136,000 if you expatriated or terminated residency in 2007. Amend 2012 tax return $139,000 if you expatriated or terminated residency in 2008. Amend 2012 tax return Your net worth is $2 million or more on the date of your expatriation or termination of residency. Amend 2012 tax return You fail to certify on Form 8854 that you have complied with all U. Amend 2012 tax return S. Amend 2012 tax return federal tax obligations for the 5 tax years preceding the date of your expatriation or termination of residency. Amend 2012 tax return Exception for dual-citizens and certain minors. Amend 2012 tax return   Certain dual-citizens and certain minors (defined next) are not subject to the expatriation tax even if they meet (1) or (2) earlier. Amend 2012 tax return However, they still must provide the certification required in (3). Amend 2012 tax return Certain dual-citizens. Amend 2012 tax return   You may qualify for the exception described above if all of the following apply. Amend 2012 tax return You became at birth a U. Amend 2012 tax return S. Amend 2012 tax return citizen and a citizen of another country and you continue to be a citizen of that other country. Amend 2012 tax return You were never a resident alien of the United States (as defined in chapter 1). Amend 2012 tax return You never held a U. Amend 2012 tax return S. Amend 2012 tax return passport. Amend 2012 tax return 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. Amend 2012 tax return S. Amend 2012 tax return citizenship. Amend 2012 tax return Certain minors. Amend 2012 tax return   You may qualify for the exception described above if you meet all of the following requirements. Amend 2012 tax return You became a U. Amend 2012 tax return S. Amend 2012 tax return citizen at birth. Amend 2012 tax return Neither of your parents was a U. Amend 2012 tax return S. Amend 2012 tax return citizen at the time of your birth. Amend 2012 tax return You expatriated before you were 18½. Amend 2012 tax return 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. Amend 2012 tax return Tax consequences of presence in the United States. Amend 2012 tax return   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. Amend 2012 tax return   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. Amend 2012 tax return Instead, you are treated as a U. Amend 2012 tax return S. Amend 2012 tax return citizen or resident and taxed on your worldwide income for that tax year. Amend 2012 tax return You must file Form 1040, 1040A, or 1040EZ and figure your tax as prescribed in the instructions for those forms. Amend 2012 tax return   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. Amend 2012 tax return 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. Amend 2012 tax return You have ties with other countries. Amend 2012 tax return 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. Amend 2012 tax return 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. Amend 2012 tax return 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. Amend 2012 tax return See Exempt individual and Medical condition in chapter 1 under Substantial Presence Test, but disregard the information about Form 8843. Amend 2012 tax return Related employer. Amend 2012 tax return   If your employer in the United States is any of the following, then your employer is related to you. Amend 2012 tax return You must count any days you performed services in the United States for that employer as days of presence in the United States. Amend 2012 tax return Members of your family. Amend 2012 tax return This includes only your brothers and sisters, half-brothers and half-sisters, spouse, ancestors (parents, grandparents, etc. Amend 2012 tax return ), and lineal descendants (children, grandchildren, etc. Amend 2012 tax return ). Amend 2012 tax return A partnership in which you directly or indirectly own more than 50% of the capital interest or the profits interest. Amend 2012 tax return A corporation in which you directly or indirectly own more than 50% in value of the outstanding stock. Amend 2012 tax return (See Publication 550, chapter 4, Constructive ownership of stock, for how to determine whether you directly or indirectly own outstanding stock. Amend 2012 tax return ) 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. Amend 2012 tax return Date of tax expatriation. Amend 2012 tax return   For purposes of U. Amend 2012 tax return S. Amend 2012 tax return tax rules, the date of your expatriation or termination of residency is the later of the dates on which you perform the following actions. Amend 2012 tax return You notify either the Department of State or the Department of Homeland Security (whichever is appropriate) of your expatriating act or termination of residency. Amend 2012 tax return You file Form 8854 in accordance with the form instructions. Amend 2012 tax return Annual return. Amend 2012 tax return   If the expatriation tax applies to you, you must file Form 8854 each year during the 10-year period following the date of expatriation. Amend 2012 tax return You must file this form even if you owe no U. Amend 2012 tax return S. Amend 2012 tax return tax. Amend 2012 tax return Penalty. Amend 2012 tax return   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. Amend 2012 tax return You will not have to pay a penalty if you show that the failure is due to reasonable cause and not to willful neglect. Amend 2012 tax return 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. Amend 2012 tax return S. Amend 2012 tax return 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. Amend 2012 tax return S. Amend 2012 tax return trade or business. Amend 2012 tax return For this purpose, U. Amend 2012 tax return S. Amend 2012 tax return 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. Amend 2012 tax return S. Amend 2012 tax return domestic corporation, and Debt obligations of U. Amend 2012 tax return S. Amend 2012 tax return persons or of the United States, a state or political subdivision thereof, or the District of Columbia. Amend 2012 tax return U. Amend 2012 tax return S. Amend 2012 tax return 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. Amend 2012 tax return The income or gain is considered U. Amend 2012 tax return S. Amend 2012 tax return 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. Amend 2012 tax return 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. Amend 2012 tax return S. Amend 2012 tax return source gross income in the tax year of the exchange unless you enter into a gain recognition agreement under Notice 97-19. Amend 2012 tax return Other information. Amend 2012 tax return   For more information on the expatriation tax provisions, including exceptions to the tax and special U. Amend 2012 tax return S. Amend 2012 tax return source rules, see section 877 of the Internal Revenue Code. Amend 2012 tax return Expatriation Tax Return If you expatriated or terminated your U. Amend 2012 tax return S. Amend 2012 tax return residency, or you are subject to the expatriation tax, you must file Form 8854, Initial and Annual Expatriation Statement. Amend 2012 tax return Attach it to Form 1040NR if you are required to file that form. Amend 2012 tax return If you are present in the United States following your expatriation and are subject to tax as a U. Amend 2012 tax return S. Amend 2012 tax return citizen or resident, file Form 8854 with Form 1040. Amend 2012 tax return 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. Amend 2012 tax return 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. Amend 2012 tax return $145,000 if you expatriated or terminated residency in 2009 or 2010. Amend 2012 tax return $147,000 if you expatriated or terminated residency in 2011. Amend 2012 tax return $151,000 if you expatriated or terminated residency in 2012. Amend 2012 tax return $155,000 if you expatriated or terminated residency in 2013. Amend 2012 tax return Your net worth is $2 million or more on the date of your expatriation or termination of residency. Amend 2012 tax return You fail to certify on Form 8854 that you have complied with all U. Amend 2012 tax return S. Amend 2012 tax return federal tax obligations for the 5 years preceding the date of your expatriation or termination of residency. Amend 2012 tax return Exception for dual-citizens and certain minors. Amend 2012 tax return   Certain dual-citizens and certain minors (defined next) are not subject to the expatriation tax even if they meet (1) or (2) above. Amend 2012 tax return However, they still must provide the certification required in (3) above. Amend 2012 tax return Certain dual-citizens. Amend 2012 tax return   You may qualify for the exception described above if both of the following apply. Amend 2012 tax return You became at birth a U. Amend 2012 tax return S. Amend 2012 tax return 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. Amend 2012 tax return 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. Amend 2012 tax return For the purpose of determining U. Amend 2012 tax return S. Amend 2012 tax return residency, use the substantial presence test described in chapter 1. Amend 2012 tax return Certain minors. Amend 2012 tax return   You may qualify for the exception described earlier if you meet both of the following requirements. Amend 2012 tax return You expatriated before you were 18½. Amend 2012 tax return You have been a resident of the United States for not more than 10 tax years before the expatriation occurs. Amend 2012 tax return For the purpose of determining U. Amend 2012 tax return S. Amend 2012 tax return residency, use the substantial presence test described in chapter 1. Amend 2012 tax return Expatriation date. Amend 2012 tax return   Your expatriation date is the date you relinquish U. Amend 2012 tax return S. Amend 2012 tax return citizenship (in the case of a former citizen) or terminate your long-term residency (in the case of a former U. Amend 2012 tax return S. Amend 2012 tax return resident). Amend 2012 tax return Former U. Amend 2012 tax return S. Amend 2012 tax return citizen. Amend 2012 tax return   You are considered to have relinquished your U. Amend 2012 tax return S. Amend 2012 tax return citizenship on the earliest of the following dates. Amend 2012 tax return The date you renounced U. Amend 2012 tax return S. Amend 2012 tax return 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). Amend 2012 tax return The date you furnished to the State Department a signed statement of voluntary relinquishment of U. Amend 2012 tax return S. Amend 2012 tax return 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). Amend 2012 tax return The date the State Department issued a certificate of loss of nationality. Amend 2012 tax return The date that a U. Amend 2012 tax return S. Amend 2012 tax return court canceled your certificate of naturalization. Amend 2012 tax return Former long-term resident. Amend 2012 tax return   You are considered to have terminated your long-term residency on the earliest of the following dates. Amend 2012 tax return The date you voluntarily relinquished your lawful permanent resident status by filing Department of Homeland Security Form I-407 with a U. Amend 2012 tax return S. Amend 2012 tax return consular or immigration officer, and the Department of Homeland Security determined that you have, in fact, abandoned your lawful permanent resident status. Amend 2012 tax return 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. Amend 2012 tax return 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. Amend 2012 tax return See Effect of Tax Treaties in chapter 1 for more information about dual residents. Amend 2012 tax return 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”). Amend 2012 tax return This applies to most types of property interests you held on the date of relinquishment of citizenship or termination of residency. Amend 2012 tax return But see Exceptions , later. Amend 2012 tax return Gains arising from deemed sales must be taken into account for the tax year of the deemed sale without regard to other U. Amend 2012 tax return S. Amend 2012 tax return internal revenue laws. Amend 2012 tax return Losses from deemed sales must be taken into account to the extent otherwise provided under U. Amend 2012 tax return S. Amend 2012 tax return internal revenue laws. Amend 2012 tax return However, Internal Revenue Code section 1091 (relating to the disallowance of losses on wash sales of stock and securities) does not apply. Amend 2012 tax return 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. Amend 2012 tax return $626,000 if you expatriated or terminated residency in 2009. Amend 2012 tax return $627,000 if you expatriated or terminated residency in 2010. Amend 2012 tax return $636,000 if you expatriated or terminated residency in 2011. Amend 2012 tax return $651,000 if you expatriated or terminated residency in 2012. Amend 2012 tax return $668,000 if you expatriated or terminated residency in 2013. Amend 2012 tax return Exceptions. Amend 2012 tax return   The mark-to-market tax does not apply to the following. Amend 2012 tax return Eligible deferred compensation items. Amend 2012 tax return Ineligible deferred compensation items. Amend 2012 tax return Interests in nongrantor trusts. Amend 2012 tax return Specified tax deferred accounts. Amend 2012 tax return Instead, items (1) and (3) may be subject to withholding at source. Amend 2012 tax return 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. Amend 2012 tax return 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. Amend 2012 tax return See paragraphs (d), (e), and (f) of section 877A for more information. Amend 2012 tax return Expatriation Tax Return If you expatriated or terminated your U. Amend 2012 tax return S. Amend 2012 tax return 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. Amend 2012 tax return Attach it to Form 1040 or Form 1040NR if you are required to file either of those forms. Amend 2012 tax return Deferral of payment of mark-to-market tax. Amend 2012 tax return   You can make an irrevocable election to defer payment of the mark-to-market tax imposed on the deemed sale of property. Amend 2012 tax return If you make this election, the following rules apply. Amend 2012 tax return You can make the election on a property-by-property basis. Amend 2012 tax return The deferred tax attributable to a particular property is due on the return for the tax year in which you dispose of the property. Amend 2012 tax return Interest is charged for the period the tax is deferred. Amend 2012 tax return The due date for the payment of the deferred tax cannot be extended beyond the earlier of the following dates. Amend 2012 tax return The due date of the return required for the year of death. Amend 2012 tax return The time that the security provided for the property fails to be adequate. Amend 2012 tax return See item (6) below. Amend 2012 tax return You make the election on Form 8854. Amend 2012 tax return You must provide adequate security (such as a bond). Amend 2012 tax return 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. Amend 2012 tax return   For more information about the deferral of payment, see the Instructions for Form 8854. Amend 2012 tax return Prev  Up  Next   Home   More Online Publications
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Sales Tax Deduction Calculator

If you file a Form 1040, and itemize deductions on Schedule A, you have the option of claiming either state and local income taxes or state and local sales taxes. (You can’t claim both.) If you saved your receipts throughout the year, you can add up the total amount of sales taxes you actually paid and claim that amount.

If you didn’t save all your receipts, you can still choose to claim state and local sales taxes. You could fill out the worksheet and use the optional general sales tax tables in the Instructions for Schedule A (Form 1040) , but why not take the easy route and use the Sales Tax Deduction Calculator!

 

Using the Sales Tax Deduction Calculator
To figure the amount of optional general sales tax you are eligible to claim, just answer a few online questions and the system does the rest. First select the tax year for which you are preparing a return. Then, using your ZIP Code and just a few entries from your draft Form 1040, the Sales Tax Deduction Calculator will automatically figure the amount of state and local sales tax you can claim. You will see the results from your entries immediately on your computer screen. Even if your state and local sales tax rates changed during the year (e.g., because the rates changed or because you moved your personal residence), the Sales Tax Deduction Calculator can handle it.

Note:  If a city has more than one tax jurisdiction sharing the same ZIP Code and County but having different local tax rates, the calculator uses the average local tax rate for those jurisdictions.

Sales Tax Deduction Calculator updated with U.S. Military District ZIP Codes
The Sales Tax Deduction Calculator has been updated with overseas U.S. Military Zones and Districts where members of U.S. Military pay no sales tax. U.S. Military Personnel who are deployed overseas can use the calculator to determine the sales tax they paid while they were within the United States. The calculator provides the ability to choose military regions using Military Zone abbreviations and ZIP codes. Members of U.S. Military can choose from one of the following Military Zone abbreviations:

 

AA  - Military Personnel in the Americas, excluding Canada

APO - Military Post Office for U.S. Army & Air Force Personnel

AE - Military Personnel in Europe, Middle East, Africa and Canada

FPO - Military Post Office for U.S. Navy Personnel
AP - Military Personnel in Asia Pacific DPO - Post Office for U.S. Embassy, State Department and other Diplomatic Personnel

 

Your entries are anonymous and the information is collected solely to allow you to determine your total allowable deduction. All entries are erased when you exit or start over. See the “IRS Privacy Policy” below for more information.

Ready to start? Continue to the Sales Tax Deduction Calculator.

Additional Resources:

Sales Tax Deduction Calculator Frequently Asked Questions

Page Last Reviewed or Updated: 14-Jan-2014

The Amend 2012 Tax Return

Amend 2012 tax return Index A Allowances, Foreign areas allowances. Amend 2012 tax return American Institute in Taiwan, American Institute in Taiwan. Amend 2012 tax return Away from home, Traveling away from home. Amend 2012 tax return B Business expenses, how to report, How To Report Business Expenses C Combat zone, Reminders Commuting expenses, Commuting. Amend 2012 tax return Contributions, Contributions. Amend 2012 tax return Cost-of-living allowances, Cost-of-living allowances. Amend 2012 tax return Credit for foreign taxes, Foreign tax credit. Amend 2012 tax return Currency conversion, loss on, Loss on conversion of U. Amend 2012 tax return S. Amend 2012 tax return dollars into foreign currency. Amend 2012 tax return D Danger pay (see Pay differentials) Death due to terrorist action, Reminders Deduction for foreign taxes, Foreign tax deduction. Amend 2012 tax return , Deduction for other foreign taxes. Amend 2012 tax return Differential pay, Pay differentials. Amend 2012 tax return Dues, Membership dues. Amend 2012 tax return E Educational expenses, Educational expenses. Amend 2012 tax return Employee business expenses, Other Employee Business Expenses Entertainment expenses, Limit on meals and entertainment. Amend 2012 tax return Expenses, deductible, Other Employee Business Expenses Extension of time to file return, When To File and Pay F Federal court employees, Federal court employees. Amend 2012 tax return Federal crime investigations, Exception for federal crime investigations or prosecutions. Amend 2012 tax return Filing information, Filing Information, When To File and Pay Foreign areas allowances, Foreign areas allowances. Amend 2012 tax return Foreign bank accounts, Foreign Bank Accounts Foreign earned income and housing exclusions, Foreign Earned Income Exclusion Foreign income, U. Amend 2012 tax return S. Amend 2012 tax return Government Payments Foreign service representation expenses, Foreign service representation expenses. Amend 2012 tax return Foreign taxes, Foreign Taxes Forms 1116, Foreign tax credit. Amend 2012 tax return 2106, Form 2106 or Form 2106-EZ. Amend 2012 tax return 2106-EZ, Form 2106 or Form 2106-EZ. Amend 2012 tax return 3903, How to report moving expenses. Amend 2012 tax return TD F 90-22. Amend 2012 tax return 1, Foreign Bank Accounts H Home leave, Home leave. Amend 2012 tax return Home mortgage interest, Real estate tax and home mortgage interest. Amend 2012 tax return Home, sale of, Sale of your home. Amend 2012 tax return Hours of service limits, Individuals subject to hours of service limits. Amend 2012 tax return I Impairment-related work expenses, Impairment-related work expenses. Amend 2012 tax return Interest on home mortgage, Real estate tax and home mortgage interest. Amend 2012 tax return International organization, U. Amend 2012 tax return S. Amend 2012 tax return reemployment after serving with, Federal reemployment payments after serving with an international organization. Amend 2012 tax return Itemized deductions Contributions, Contributions. Amend 2012 tax return Employee business expenses, Other Employee Business Expenses Home mortgage interest, Real estate tax and home mortgage interest. Amend 2012 tax return Real estate tax, Real estate tax and home mortgage interest. Amend 2012 tax return L Lodging, Lodging furnished to a principal representative of the United States. Amend 2012 tax return Loss on currency conversion, Loss on conversion of U. Amend 2012 tax return S. Amend 2012 tax return dollars into foreign currency. Amend 2012 tax return M Meal expenses, Limit on meals and entertainment. Amend 2012 tax return More information (see Tax help) Mortgage interest, Real estate tax and home mortgage interest. Amend 2012 tax return Moving expenses, Moving Expenses, Closely related to the start of work. Amend 2012 tax return , Distance test. Amend 2012 tax return , Time test. Amend 2012 tax return , Reimbursements. Amend 2012 tax return P Pay differentials, Pay differentials. Amend 2012 tax return Peace Corps volunteers, Peace Corps. Amend 2012 tax return Personal property, sale of, Sale of personal property. Amend 2012 tax return Post differentials (see Pay differentials) Post exchanges, Employees of post exchanges, etc. Amend 2012 tax return Principal representative, Lodging furnished to a principal representative of the United States. Amend 2012 tax return Proving expenses, Recordkeeping Rules R Real estate tax, Real estate tax and home mortgage interest. Amend 2012 tax return Recordkeeping, business expenses, Recordkeeping Rules Reemployed by federal agency, Federal reemployment payments after serving with an international organization. Amend 2012 tax return Reporting Business expenses, How To Report Business Expenses Moving expenses, Moving Expenses, How to report moving expenses. Amend 2012 tax return Representation expenses, Foreign service representation expenses. Amend 2012 tax return S Sale of home, Sale of your home. Amend 2012 tax return Sale of personal property, Sale of personal property. Amend 2012 tax return Subscriptions, Subscriptions. Amend 2012 tax return T Taiwan, American Institute in, American Institute in Taiwan. Amend 2012 tax return Tax credit for foreign taxes, Foreign tax credit. Amend 2012 tax return Taxpayer Advocate, Taxpayer Advocate Service. Amend 2012 tax return Temporary assignment, Temporary assignment. Amend 2012 tax return Terrorist action, Reminders Transportation expenses, Transportation Expenses Travel expenses, Travel Expenses W When to file return, When To File and Pay Prev  Up     Home   More Online Publications