Get Your Tax Refund
File your Federal Taxes for
Free with TurboTax Federal FREE Edition
FREE to Prepare + FREE to Print + FREE to E-file
- Get your maximum refund*
- 100% accurate calculations guaranteed*
TurboTax Federal Free Edition - File Taxes Online
Don't let filing your taxes get you down! We'll help make it as easy as possible. With e-file and direct deposit, there's no faster way to get your refund!
Approved TurboTax Affiliate Site. TurboTax and TurboTax Online, among others, are registered trademarks and/or service marks of Intuit Inc. in the United States and other countries. Other parties' trademarks or service marks are the property of the respective owners.
Amended FormAmended Kansas Tax Return1040nr Tax ReturnFile Irs Extension2012 Tax Return TurbotaxH&block ComFree State Tax FormFree Online Tax 2010Taxact 2011 Free DownloadFree Turbo Tax2010 Online Tax FilingTax Planning Us 1040aMilitary Filing State TaxesEz Tax FormTurbo Tax 20061040 Ez FormTax DeductionsFile 2011 Taxes Free OnlineFile Taxes From 20111040x Form2012 Tax Form 1040ezDo I File 2008 Tax ReturnEfile Taxes FreeTax Rates And Tables1040ez 2012 Form2014 1040 EzCan I File A 1040x OnlineWhere Can I File My Federal And State Taxes Online For FreeFederal 1040xTaxslayer MilitaryFiling 2010 Tax Return2011 Tax Return2010 1040x FormEztaxFile 1040nr OnlineFile Taxes Past Years1040a Instruction BookH&r Block Federal FreeFile State Income Tax1040x For 20101040ez Tax Form 2011
Amended FormAmended form 5. Amended form Taxes Table of Contents What's New Introduction Topics - This chapter discusses: Useful Items - You may want to see: When To Deduct Taxes Real Estate TaxesSeparate elections. Amended form Making the election. Amended form Form 3115. Amended form Income TaxesAccrual of contested income taxes. Amended form Employment Taxes Other TaxesAdditional Medicare Tax. Amended form What's New Additional Medicare Tax. Amended form Beginning in 2013, you must withhold a 0. Amended form 9% Additional Medicare Tax from wages you pay to an employee in excess of $200,000 in a calendar year. Amended form Also, self-employed individuals may be required to pay Additional Medicare Tax on self-employment income. Amended form See Employment Taxes , and Self-employment tax , later. Amended form Introduction You can deduct various federal, state, local, and foreign taxes directly attributable to your trade or business as business expenses. Amended form You cannot deduct federal income taxes, estate and gift taxes, or state inheritance, legacy, and succession taxes. Amended form Topics - This chapter discusses: When to deduct taxes Real estate taxes Income taxes Employment taxes Other taxes Useful Items - You may want to see: Publication 15 (Circular E), Employer's Tax Guide 334 Tax Guide for Small Business 510 Excise Taxes 538 Accounting Periods and Methods 551 Basis of Assets Form (and Instructions) Sch A (Form 1040) Itemized Deductions Sch SE (Form 1040) Self-Employment Tax 3115 Application for Change in Accounting Method 8959 Additional Medicare Tax See chapter 12 for information about getting publications and forms. Amended form When To Deduct Taxes Generally, you can only deduct taxes in the year you pay them. Amended form This applies whether you use the cash method or an accrual method of accounting. Amended form Under an accrual method, you can deduct a tax before you pay it if you meet the exception for recurring items discussed under Economic Performance in Publication 538. Amended form You can also elect to ratably accrue real estate taxes as discussed later under Real Estate Taxes . Amended form Limit on accrual of taxes. Amended form A taxing jurisdiction can require the use of a date for accruing taxes that is earlier than the date it originally required. Amended form However, if you use an accrual method, and can deduct the tax before you pay it, use the original accrual date for the year of change and all future years to determine when you can deduct the tax. Amended form Example. Amended form Your state imposes a tax on personal property used in a trade or business conducted in the state. Amended form This tax is assessed and becomes a lien as of July 1 (accrual date). Amended form In 2013, the state changed the assessment and lien dates from July 1, 2014, to December 31, 2013, for property tax year 2014. Amended form Use the original accrual date (July 1, 2014) to determine when you can deduct the tax. Amended form You must also use the July 1 accrual date for all future years to determine when you can deduct the tax. Amended form Uniform capitalization rules. Amended form Uniform capitalization rules apply to certain taxpayers who produce real property or tangible personal property for use in a trade or business or for sale to customers. Amended form They also apply to certain taxpayers who acquire property for resale. Amended form Under these rules, you either include certain costs in inventory or capitalize certain expenses related to the property, such as taxes. Amended form For more information, see chapter 1. Amended form Carrying charges. Amended form Carrying charges include taxes you pay to carry or develop real estate or to carry, transport, or install personal property. Amended form You can elect to capitalize carrying charges not subject to the uniform capitalization rules if they are otherwise deductible. Amended form For more information, see chapter 7. Amended form Refunds of taxes. Amended form If you receive a refund for any taxes you deducted in an earlier year, include the refund in income to the extent the deduction reduced your federal income tax in the earlier year. Amended form For more information, see Recovery of amount deducted (tax benefit rule) in chapter 1. Amended form You must include in income any interest you receive on tax refunds. Amended form Real Estate Taxes Deductible real estate taxes are any state, local, or foreign taxes on real estate levied for the general public welfare. Amended form The taxing authority must base the taxes on the assessed value of the real estate and charge them uniformly against all property under its jurisdiction. Amended form Deductible real estate taxes generally do not include taxes charged for local benefits and improvements that increase the value of the property. Amended form See Taxes for local benefits , later. Amended form If you use an accrual method, you generally cannot accrue real estate taxes until you pay them to the government authority. Amended form However, you can elect to ratably accrue the taxes during the year. Amended form See Electing to ratably accrue , later. Amended form Taxes for local benefits. Amended form Generally, you cannot deduct taxes charged for local benefits and improvements that tend to increase the value of your property. Amended form These include assessments for streets, sidewalks, water mains, sewer lines, and public parking facilities. Amended form You should increase the basis of your property by the amount of the assessment. Amended form You can deduct taxes for these local benefits only if the taxes are for maintenance, repairs, or interest charges related to those benefits. Amended form If part of the tax is for maintenance, repairs, or interest, you must be able to show how much of the tax is for these expenses to claim a deduction for that part of the tax. Amended form Example. Amended form To improve downtown commercial business, Waterfront City converted a downtown business area street into an enclosed pedestrian mall. Amended form The city assessed the full cost of construction, financed with 10-year bonds, against the affected properties. Amended form The city is paying the principal and interest with the annual payments made by the property owners. Amended form The assessments for construction costs are not deductible as taxes or as business expenses, but are depreciable capital expenses. Amended form The part of the payments used to pay the interest charges on the bonds is deductible as taxes. Amended form Charges for services. Amended form Water bills, sewerage, and other service charges assessed against your business property are not real estate taxes, but are deductible as business expenses. Amended form Purchase or sale of real estate. Amended form If real estate is sold, the real estate taxes must be allocated between the buyer and the seller. Amended form The buyer and seller must allocate the real estate taxes according to the number of days in the real property tax year (the period to which the tax imposed relates) that each owned the property. Amended form Treat the seller as paying the taxes up to but not including the date of sale. Amended form Treat the buyer as paying the taxes beginning with the date of sale. Amended form You can usually find this information on the settlement statement you received at closing. Amended form If you (the seller) use an accrual method and have not elected to ratably accrue real estate taxes, you are considered to have accrued your part of the tax on the date you sell the property. Amended form Example. Amended form Alberto Verde, a calendar year accrual method taxpayer, owns real estate in Olmo County. Amended form He has not elected to ratably accrue property taxes. Amended form November 30 of each year is the assessment and lien date for the current real property tax year, which is the calendar year. Amended form He sold the property on June 30, 2013. Amended form Under his accounting method he would not be able to claim a deduction for the taxes because the sale occurred before November 30. Amended form He is treated as having accrued his part of the tax, 181/366 (January 1–June 29), on June 30, and he can deduct it for 2013. Amended form Electing to ratably accrue. Amended form If you use an accrual method, you can elect to accrue real estate tax related to a definite period ratably over that period. Amended form Example. Amended form Juan Sanchez is a calendar year taxpayer who uses an accrual method. Amended form His real estate taxes for the real property tax year, July 1, 2013, to June 30, 2014, are $1,200. Amended form July 1 is the assessment and lien date. Amended form If Juan elects to ratably accrue the taxes, $600 will accrue in 2013 ($1,200 × 6/12, July 1–December 31) and the balance will accrue in 2014. Amended form Separate elections. Amended form You can elect to ratably accrue the taxes for each separate trade or business and for nonbusiness activities if you account for them separately. Amended form Once you elect to ratably accrue real estate taxes, you must use that method unless you get permission from the IRS to change. Amended form See Form 3115 , later. Amended form Making the election. Amended form If you elect to ratably accrue the taxes for the first year in which you incur real estate taxes, attach a statement to your income tax return for that year. Amended form The statement should show all the following items. Amended form The trades or businesses to which the election applies and the accounting method or methods used. Amended form The period to which the taxes relate. Amended form The computation of the real estate tax deduction for that first year. Amended form Generally, you must file your return by the due date (including extensions). Amended form However, if you timely filed your return for the year without electing to ratably accrue, you can still make the election by filing an amended return within 6 months after the due date of the return (excluding extensions). Amended form Attach the statement to the amended return and write “Filed pursuant to section 301. Amended form 9100-2” on the statement. Amended form File the amended return at the same address where you filed the original return. Amended form Form 3115. Amended form If you elect to ratably accrue real estate taxes for a year after the first year in which you incur real estate taxes, or if you want to revoke your election to ratably accrue real estate taxes, file Form 3115. Amended form For more information, including applicable time frames for filing, see the Instructions for Form 3115. Amended form Note. Amended form If you are filing an application for a change in accounting method filed after January 9, 2011, for a year of change ending after April 29, 2010, see Revenue Procedure 2011-14, 2011-4 I. Amended form R. Amended form B. Amended form 330, as modified and clarified by Revenue Procedure 2012-19, 2012-14 I. Amended form R. Amended form B. Amended form 689, and Revenue Procedure 2012-20, 2012-14 I. Amended form R. Amended form B. Amended form 700, or any successor. Amended form Revenue Procedure 2011-14 is available at www. Amended form irs. Amended form gov/irb/2011-04IRB/ar08. Amended form html. Amended form Income Taxes This section discusses federal, state, local, and foreign income taxes. Amended form Federal income taxes. Amended form You cannot deduct federal income taxes. Amended form State and local income taxes. Amended form A corporation or partnership can deduct state and local income taxes imposed on the corporation or partnership as business expenses. Amended form An individual can deduct state and local income taxes only as an itemized deduction on Schedule A (Form 1040). Amended form However, an individual can deduct a state tax on gross income (as distinguished from net income) directly attributable to a trade or business as a business expense. Amended form Accrual of contested income taxes. Amended form If you use an accrual method, and you contest a state or local income tax liability, you must accrue and deduct any contested amount in the tax year in which the liability is finally determined. Amended form If additional state or local income taxes for a prior year are assessed in a later year, you can deduct the taxes in the year in which they were originally imposed (the prior year) if the tax liability is not contested. Amended form You cannot deduct them in the year in which the liability is finally determined. Amended form The filing of an income tax return is not considered a contest and, in the absence of an overt act of protest, you can deduct the tax in the prior year. Amended form Also, you can deduct any additional taxes in the prior year if you do not show some affirmative evidence of denial of the liability. Amended form However, if you consistently deduct additional assessments in the year they are paid or finally determined (including those for which there was no contest), you must continue to do so. Amended form You cannot take a deduction in the earlier year unless you receive permission to change your method of accounting. Amended form For more information on accounting methods, see When Can I Deduct an Expense in chapter 1. Amended form Foreign income taxes. Amended form Generally, you can take either a deduction or a credit for income taxes imposed on you by a foreign country or a U. Amended form S. Amended form possession. Amended form However, an individual cannot take a deduction or credit for foreign income taxes paid on income that is exempt from U. Amended form S. Amended form tax under the foreign earned income exclusion or the foreign housing exclusion. Amended form For information on these exclusions, see Publication 54, Tax Guide for U. Amended form S. Amended form Citizens and Resident Aliens Abroad. Amended form For information on the foreign tax credit, see Publication 514, Foreign Tax Credit for Individuals. Amended form Employment Taxes If you have employees, you must withhold various taxes from your employees' pay. Amended form Most employers must withhold their employees' share of social security, Medicare taxes, and Additional Medicare Tax (if applicable) along with state and federal income taxes. Amended form You may also need to pay certain employment taxes from your own funds. Amended form These include your share of social security and Medicare taxes as an employer, along with unemployment taxes. Amended form Note. Amended form Additional Medicare Tax is only imposed on the employee. Amended form There is no employer share of Additional Medicare Tax. Amended form Your deduction for wages paid is not reduced by the social security and Medicare taxes, Additional Medicare Tax, and income taxes you withhold from your employees. Amended form You can deduct the employment taxes you must pay from your own funds as taxes. Amended form Example. Amended form You pay your employee $18,000 a year. Amended form However, after you withhold various taxes, your employee receives $14,500. Amended form You also pay an additional $1,500 in employment taxes. Amended form You should deduct the full $18,000 as wages. Amended form You can deduct the $1,500 you pay from your own funds as taxes. Amended form For more information on employment taxes, see Publication 15 (Circular E). Amended form Unemployment fund taxes. Amended form As an employer, you may have to make payments to a state unemployment compensation fund or to a state disability benefit fund. Amended form Deduct these payments as taxes. Amended form Other Taxes The following are other taxes you can deduct if you incur them in the ordinary course of your trade or business. Amended form Excise taxes. Amended form Generally, you can deduct as a business expense all excise taxes that are ordinary and necessary expenses of carrying on your trade or business. Amended form However, see Fuel taxes , later. Amended form For more information on excise taxes, see Publication 510. Amended form Franchise taxes. Amended form You can deduct corporate franchise taxes as a business expense. Amended form Fuel taxes. Amended form Generally, taxes on gasoline, diesel fuel, and other motor fuels that you use in your business are included as part of the cost of the fuel. Amended form Do not deduct these taxes as a separate item. Amended form You may be entitled to a credit or refund for federal excise tax you paid on fuels used for certain purposes. Amended form For more information, see Publication 510. Amended form Occupational taxes. Amended form You can deduct as a business expense an occupational tax charged at a flat rate by a locality for the privilege of working or conducting a business in the locality. Amended form Personal property tax. Amended form You can deduct any tax imposed by a state or local government on personal property used in your trade or business. Amended form Sales tax. Amended form Treat any sales tax you pay on a service or on the purchase or use of property as part of the cost of the service or property. Amended form If the service or the cost or use of the property is a deductible business expense, you can deduct the tax as part of that service or cost. Amended form If the property is merchandise bought for resale, the sales tax is part of the cost of the merchandise. Amended form If the property is depreciable, add the sales tax to the basis for depreciation. Amended form For more information on basis, see Publication 551. Amended form Do not deduct state and local sales taxes imposed on the buyer that you must collect and pay over to the state or local government. Amended form Also, do not include these taxes in gross receipts or sales. Amended form Self-employment tax. Amended form You can deduct part of your self-employment tax as a business expense in figuring your adjusted gross income. Amended form This deduction only affects your income tax. Amended form It does not affect your net earnings from self-employment or your self-employment tax. Amended form To deduct the tax, enter on Form 1040, line 27, the amount shown on the Deduction for one-half of self-employment tax line of Schedule SE (Form 1040). Amended form For more information on self-employment tax, see Publication 334. Amended form Additional Medicare Tax. Amended form Beginning in 2013, you may be required to pay Additional Medicare Tax on self-employment income. Amended form See Form 8959 and the Instructions for Form 8959 for more information on the Additional Medicare Tax. Amended form Prev Up Next Home More Online Publications
Bureau of Labor Statistics
The Bureau of Labor Statistics measures labor market activity, working conditions, and price changes in the economy.