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E-file Prior Year Tax Return

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E-file Prior Year Tax Return

E-file prior year tax return Publication 526 - Main Content Table of Contents Organizations That Qualify To Receive Deductible ContributionsTypes of Qualified Organizations Contributions You Can DeductContributions From Which You Benefit Expenses Paid for Student Living With You Out-of-Pocket Expenses in Giving Services Expenses of Whaling Captains Contributions You Cannot DeductContributions to Individuals Contributions to Nonqualified Organizations Contributions From Which You Benefit Value of Time or Services Personal Expenses Appraisal Fees Contributions to Donor-Advised Funds Partial Interest in Property Contributions of PropertyContributions Subject to Special Rules Determining Fair Market Value Giving Property That Has Decreased in Value Giving Property That Has Increased in Value Penalty When To DeductChecks. E-file prior year tax return Text message. E-file prior year tax return Credit card. E-file prior year tax return Pay-by-phone account. E-file prior year tax return Stock certificate. E-file prior year tax return Promissory note. E-file prior year tax return Option. E-file prior year tax return Borrowed funds. E-file prior year tax return Conditional gift. E-file prior year tax return Limits on Deductions50% Limit 30% Limit Special 30% Limit for Capital Gain Property 20% Limit Special 50% Limit for Qualified Conservation Contributions How To Figure Your Deduction When Limits Apply Records To KeepCash Contributions Noncash Contributions Out-of-Pocket Expenses How To ReportReporting expenses for student living with you. E-file prior year tax return Total deduction over $500. E-file prior year tax return Deduction over $5,000 for one item. E-file prior year tax return Vehicle donations. E-file prior year tax return Clothing and household items not in good used condition. E-file prior year tax return Easement on building in historic district. E-file prior year tax return Deduction over $500,000. E-file prior year tax return How To Get Tax HelpLow Income Taxpayer Clinics Organizations That Qualify To Receive Deductible Contributions You can deduct your contributions only if you make them to a qualified organization. E-file prior year tax return Most organizations, other than churches and governments, must apply to the IRS to become a qualified organization. E-file prior year tax return How to check whether an organization can receive deductible charitable contributions. E-file prior year tax return   You can ask any organization whether it is a qualified organization, and most will be able to tell you. E-file prior year tax return Or go to IRS. E-file prior year tax return gov. E-file prior year tax return Click on “Tools” and then on “Exempt Organizations Select Check” (www. E-file prior year tax return irs. E-file prior year tax return gov/Charities-&-Non-Profits/Exempt-Organizations-Select-Check). E-file prior year tax return This online tool will enable you to search for qualified organizations. E-file prior year tax return You can also call the IRS to find out if an organization is qualified. E-file prior year tax return Call 1-877-829-5500. E-file prior year tax return People who are deaf, hard of hearing, or have a speech disability and who have access to TTY/TDD equipment can call 1-800-829-4059. E-file prior year tax return Deaf or hard of hearing individuals can also contact the IRS through relay services such as the Federal Relay Service at www. E-file prior year tax return gsa. E-file prior year tax return gov/fedrelay. E-file prior year tax return Types of Qualified Organizations Generally, only the following types of organizations can be qualified organizations. E-file prior year tax return A community chest, corporation, trust, fund, or foundation organized or created in or under the laws of the United States, any state, the District of Columbia, or any possession of the United States (including Puerto Rico). E-file prior year tax return It must, however, be organized and operated only for charitable, religious, scientific, literary, or educational purposes, or for the prevention of cruelty to children or animals. E-file prior year tax return Certain organizations that foster national or international amateur sports competition also qualify. E-file prior year tax return War veterans' organizations, including posts, auxiliaries, trusts, or foundations, organized in the United States or any of its possessions (including Puerto Rico). E-file prior year tax return Domestic fraternal societies, orders, and associations operating under the lodge system. E-file prior year tax return (Your contribution to this type of organization is deductible only if it is to be used solely for charitable, religious, scientific, literary, or educational purposes, or for the prevention of cruelty to children or animals. E-file prior year tax return ) Certain nonprofit cemetery companies or corporations. E-file prior year tax return (Your contribution to this type of organization is not deductible if it can be used for the care of a specific lot or mausoleum crypt. E-file prior year tax return ) The United States or any state, the District of Columbia, a U. E-file prior year tax return S. E-file prior year tax return possession (including Puerto Rico), a political subdivision of a state or U. E-file prior year tax return S. E-file prior year tax return possession, or an Indian tribal government or any of its subdivisions that perform substantial government functions. E-file prior year tax return (Your contribution to this type of organization is deductible only if it is to be used solely for public purposes. E-file prior year tax return ) Example 1. E-file prior year tax return You contribute cash to your city's police department to be used as a reward for information about a crime. E-file prior year tax return The city police department is a qualified organization, and your contribution is for a public purpose. E-file prior year tax return You can deduct your contribution. E-file prior year tax return Example 2. E-file prior year tax return You make a voluntary contribution to the social security trust fund, not earmarked for a specific account. E-file prior year tax return Because the trust fund is part of the U. E-file prior year tax return S. E-file prior year tax return Government, you contributed to a qualified organization. E-file prior year tax return You can deduct your contribution. E-file prior year tax return Examples. E-file prior year tax return   The following list gives some examples of qualified organizations. E-file prior year tax return Churches, a convention or association of churches, temples, synagogues, mosques, and other religious organizations. E-file prior year tax return Most nonprofit charitable organizations such as the American Red Cross and the United Way. E-file prior year tax return Most nonprofit educational organizations, including the Boy Scouts of America, Girl Scouts of America, colleges, and museums. E-file prior year tax return This also includes nonprofit daycare centers that provide childcare to the general public if substantially all the childcare is provided to enable parents and guardians to be gainfully employed. E-file prior year tax return However, if your contribution is a substitute for tuition or other enrollment fee, it is not deductible as a charitable contribution, as explained later under Contributions You Cannot Deduct . E-file prior year tax return Nonprofit hospitals and medical research organizations. E-file prior year tax return Utility company emergency energy programs, if the utility company is an agent for a charitable organization that assists individuals with emergency energy needs. E-file prior year tax return Nonprofit volunteer fire companies. E-file prior year tax return Nonprofit organizations that develop and maintain public parks and recreation facilities. E-file prior year tax return Civil defense organizations. E-file prior year tax return Canadian charities. E-file prior year tax return   You may be able to deduct contributions to certain Canadian charitable organizations covered under an income tax treaty with Canada. E-file prior year tax return To deduct your contribution to a Canadian charity, you generally must have income from sources in Canada. E-file prior year tax return See Publication 597, Information on the United States-Canada Income Tax Treaty, for information on how to figure your deduction. E-file prior year tax return Mexican charities. E-file prior year tax return   Under the U. E-file prior year tax return S. E-file prior year tax return -Mexico income tax treaty, a contribution to a Mexican charitable organization may be deductible, but only if and to the extent the contribution would have been treated as a charitable contribution to a public charity created or organized under U. E-file prior year tax return S. E-file prior year tax return law. E-file prior year tax return To deduct your contribution to a Mexican charity, you must have income from sources in Mexico. E-file prior year tax return The limits described in Limits on Deductions , later, apply and are figured using your income from Mexican sources. E-file prior year tax return Israeli charities. E-file prior year tax return   Under the U. E-file prior year tax return S. E-file prior year tax return -Israel income tax treaty, a contribution to an Israeli charitable organization is deductible if and to the extent the contribution would have been treated as a charitable contribution if the organization had been created or organized under U. E-file prior year tax return S. E-file prior year tax return law. E-file prior year tax return To deduct your contribution to an Israeli charity, you must have income from sources in Israel. E-file prior year tax return The limits described in Limits on Deductions , later, apply. E-file prior year tax return The deduction is also limited to 25% of your adjusted gross income from Israeli sources. E-file prior year tax return Contributions You Can Deduct Generally, you can deduct contributions of money or property you make to, or for the use of, a qualified organization. E-file prior year tax return A contribution is “for the use of” a qualified organization when it is held in a legally enforceable trust for the qualified organization or in a similar legal arrangement. E-file prior year tax return The contributions must be made to a qualified organization and not set aside for use by a specific person. E-file prior year tax return If you give property to a qualified organization, you generally can deduct the fair market value of the property at the time of the contribution. E-file prior year tax return See Contributions of Property , later. E-file prior year tax return Your deduction for charitable contributions generally cannot be more than 50% of your adjusted gross income (AGI), but in some cases 20% and 30% limits may apply. E-file prior year tax return In addition, the total of your charitable contributions deduction and certain other itemized deductions may be limited. E-file prior year tax return See Limits on Deductions , later. E-file prior year tax return Table 1 in this publication gives examples of contributions you can and cannot deduct. E-file prior year tax return Contributions From Which You Benefit If you receive a benefit as a result of making a contribution to a qualified organization, you can deduct only the amount of your contribution that is more than the value of the benefit you receive. E-file prior year tax return Also see Contributions From Which You Benefit under Contributions You Cannot Deduct, later. E-file prior year tax return If you pay more than fair market value to a qualified organization for goods or services, the excess may be a charitable contribution. E-file prior year tax return For the excess amount to qualify, you must pay it with the intent to make a charitable contribution. E-file prior year tax return Example 1. E-file prior year tax return You pay $65 for a ticket to a dinner-dance at a church. E-file prior year tax return Your entire $65 payment goes to the church. E-file prior year tax return The ticket to the dinner-dance has a fair market value of $25. E-file prior year tax return When you buy your ticket, you know its value is less than your payment. E-file prior year tax return To figure the amount of your charitable contribution, subtract the value of the benefit you receive ($25) from your total payment ($65). E-file prior year tax return You can deduct $40 as a charitable contribution to the church. E-file prior year tax return Example 2. E-file prior year tax return At a fundraising auction conducted by a charity, you pay $600 for a week's stay at a beach house. E-file prior year tax return The amount you pay is no more than the fair rental value. E-file prior year tax return You have not made a deductible charitable contribution. E-file prior year tax return Athletic events. E-file prior year tax return   If you make a payment to, or for the benefit of, a college or university and, as a result, you receive the right to buy tickets to an athletic event in the athletic stadium of the college or university, you can deduct 80% of the payment as a charitable contribution. E-file prior year tax return   If any part of your payment is for tickets (rather than the right to buy tickets), that part is not deductible. E-file prior year tax return Subtract the price of the tickets from your payment. E-file prior year tax return You can deduct 80% of the remaining amount as a charitable contribution. E-file prior year tax return Example 1. E-file prior year tax return You pay $300 a year for membership in a university's athletic scholarship program. E-file prior year tax return The only benefit of membership is that you have the right to buy one season ticket for a seat in a designated area of the stadium at the university's home football games. E-file prior year tax return You can deduct $240 (80% of $300) as a charitable contribution. E-file prior year tax return Example 2. E-file prior year tax return The facts are the same as in Example 1 except your $300 payment includes the purchase of one season ticket for the stated ticket price of $120. E-file prior year tax return You must subtract the usual price of a ticket ($120) from your $300 payment. E-file prior year tax return The result is $180. E-file prior year tax return Your deductible charitable contribution is $144 (80% of $180). E-file prior year tax return Charity benefit events. E-file prior year tax return   If you pay a qualified organization more than fair market value for the right to attend a charity ball, banquet, show, sporting event, or other benefit event, you can deduct only the amount that is more than the value of the privileges or other benefits you receive. E-file prior year tax return   If there is an established charge for the event, that charge is the value of your benefit. E-file prior year tax return If there is no established charge, the reasonable value of the right to attend the event is the value of your benefit. E-file prior year tax return Whether you use the tickets or other privileges has no effect on the amount you can deduct. E-file prior year tax return However, if you return the ticket to the qualified organization for resale, you can deduct the entire amount you paid for the ticket. E-file prior year tax return    Even if the ticket or other evidence of payment indicates that the payment is a “contribution,” this does not mean you can deduct the entire amount. E-file prior year tax return If the ticket shows the price of admission and the amount of the contribution, you can deduct the contribution amount. E-file prior year tax return Example. E-file prior year tax return You pay $40 to see a special showing of a movie for the benefit of a qualified organization. E-file prior year tax return Printed on the ticket is “Contribution–$40. E-file prior year tax return ” If the regular price for the movie is $8, your contribution is $32 ($40 payment − $8 regular price). E-file prior year tax return Membership fees or dues. E-file prior year tax return   You may be able to deduct membership fees or dues you pay to a qualified organization. E-file prior year tax return However, you can deduct only the amount that is more than the value of the benefits you receive. E-file prior year tax return   You cannot deduct dues, fees, or assessments paid to country clubs and other social organizations. E-file prior year tax return They are not qualified organizations. E-file prior year tax return Certain membership benefits can be disregarded. E-file prior year tax return   Both you and the organization can disregard the following membership benefits if you get them in return for an annual payment of $75 or less. E-file prior year tax return Any rights or privileges, other than those discussed under Athletic events , earlier, that you can use frequently while you are a member, such as: Free or discounted admission to the organization's facilities or events, Free or discounted parking, Preferred access to goods or services, and Discounts on the purchase of goods and services. E-file prior year tax return Admission, while you are a member, to events open only to members of the organization if the organization reasonably projects that the cost per person (excluding any allocated overhead) is not more than $10. E-file prior year tax return 20. E-file prior year tax return Token items. E-file prior year tax return   You do not have to reduce your contribution by the value of any benefit you receive if both of the following are true. E-file prior year tax return You receive only a small item or other benefit of token value. E-file prior year tax return The qualified organization correctly determines that the value of the item or benefit you received is not substantial and informs you that you can deduct your payment in full. E-file prior year tax return The organization determines whether the value of an item or benefit is substantial by using Revenue Procedures 90-12 and 92-49 and the inflation adjustment in Revenue Procedure 2012–41. E-file prior year tax return Written statement. E-file prior year tax return   A qualified organization must give you a written statement if you make a payment of more than $75 that is partly a contribution and partly for goods or services. E-file prior year tax return The statement must say you can deduct only the amount of your payment that is more than the value of the goods or services you received. E-file prior year tax return It must also give you a good faith estimate of the value of those goods or services. E-file prior year tax return   The organization can give you the statement either when it solicits or when it receives the payment from you. E-file prior year tax return Exception. E-file prior year tax return   An organization will not have to give you this statement if one of the following is true. E-file prior year tax return The organization is: A governmental organization described in (5) under Types of Qualified Organizations , earlier, or An organization formed only for religious purposes, and the only benefit you receive is an intangible religious benefit (such as admission to a religious ceremony) that generally is not sold in commercial transactions outside the donative context. E-file prior year tax return You receive only items whose value is not substantial as described under Token items , earlier. E-file prior year tax return You receive only membership benefits that can be disregarded, as described under Membership fees or dues , earlier. E-file prior year tax return Expenses Paid for Student Living With You You may be able to deduct some expenses of having a student live with you. E-file prior year tax return You can deduct qualifying expenses for a foreign or American student who: Lives in your home under a written agreement between you and a qualified organization (defined later) as part of a program of the organization to provide educational opportunities for the student, Is not your relative (defined later) or dependent (also defined later), and Is a full-time student in the twelfth or any lower grade at a school in the United States. E-file prior year tax return You can deduct up to $50 a month for each full calendar month the student lives with you. E-file prior year tax return Any month when conditions (1) through (3) above are met for 15 or more days counts as a full month. E-file prior year tax return Qualified organization. E-file prior year tax return   For these purposes, a qualified organization can be any of the organizations described earlier under Types of Qualified Organizations , except those in (4) and (5). E-file prior year tax return For example, if you are providing a home for a student as part of a state or local government program, you cannot deduct your expenses as charitable contributions. E-file prior year tax return But see Foster parents under Out-of-Pocket Expenses in Giving Services, later, if you provide the home as a foster parent. E-file prior year tax return Relative. E-file prior year tax return   The term “relative” means any of the following persons. E-file prior year tax return Your child, stepchild, foster child, or a descendant of any of them (for example, your grandchild). E-file prior year tax return A legally adopted child is considered your child. E-file prior year tax return Your brother, sister, half brother, half sister, stepbrother, or stepsister. E-file prior year tax return Your father, mother, grandparent, or other direct ancestor. E-file prior year tax return Your stepfather or stepmother. E-file prior year tax return A son or daughter of your brother or sister. E-file prior year tax return A brother or sister of your father or mother. E-file prior year tax return Your son-in-law, daughter-in-law, father-in-law, mother-in-law, brother-in-law, or sister-in-law. E-file prior year tax return Dependent. E-file prior year tax return   For this purpose, the term “dependent” means: A person you can claim as a dependent, or A person you could have claimed as a dependent except that: He or she received gross income of $3,900 or more, He or she filed a joint return, or You, or your spouse if filing jointly, could be claimed as a dependent on someone else's 2013 return. E-file prior year tax return    Foreign students brought to this country under a qualified international education exchange program and placed in American homes for a temporary period generally are not U. E-file prior year tax return S. E-file prior year tax return residents and cannot be claimed as dependents. E-file prior year tax return Qualifying expenses. E-file prior year tax return   You may be able to deduct the cost of books, tuition, food, clothing, transportation, medical and dental care, entertainment, and other amounts you actually spend for the well-being of the student. E-file prior year tax return Expenses that do not qualify. E-file prior year tax return   You cannot deduct depreciation on your home, the fair market value of lodging, and similar items not considered amounts actually spent by you. E-file prior year tax return Nor can you deduct general household expenses, such as taxes, insurance, and repairs. E-file prior year tax return Reimbursed expenses. E-file prior year tax return   In most cases, you cannot claim a charitable contribution deduction if you are compensated or reimbursed for any part of the costs of having a student live with you. E-file prior year tax return However, you may be able to claim a charitable contribution deduction for the unreimbursed portion of your expenses if you are reimbursed only for an extraordinary or one-time item, such as a hospital bill or vacation trip, you paid in advance at the request of the student's parents or the sponsoring organization. E-file prior year tax return Mutual exchange program. E-file prior year tax return   You cannot deduct the costs of a foreign student living in your home under a mutual exchange program through which your child will live with a family in a foreign country. E-file prior year tax return Reporting expenses. E-file prior year tax return   For a list of what you must file with your return if you deduct expenses for a student living with you, see Reporting expenses for student living with you under How To Report, later. E-file prior year tax return Out-of-Pocket Expenses in Giving Services Table 2. E-file prior year tax return Volunteers' Questions and Answers If you volunteer for a qualified organization, the following questions and answers may apply to you. E-file prior year tax return All of the rules explained in this publication also apply. E-file prior year tax return See, in particular, Out-of-Pocket Expenses in Giving Services . E-file prior year tax return Question Answer I volunteer 6 hours a week in the office of a qualified organization. E-file prior year tax return The receptionist is paid $10 an hour for the same work. E-file prior year tax return Can I deduct $60 a week for my time? No, you cannot deduct the value of your time or services. E-file prior year tax return  The office is 30 miles from my home. E-file prior year tax return Can I deduct any of my car expenses for these trips? Yes, you can deduct the costs of gas and oil that are directly related to getting to and from the place where you volunteer. E-file prior year tax return If you do not want to figure your actual costs, you can deduct 14 cents for each mile. E-file prior year tax return I volunteer as a Red Cross nurse's aide at a hospital. E-file prior year tax return Can I deduct the cost of the uniforms I must wear? Yes, you can deduct the cost of buying and cleaning your uniforms if the hospital is a qualified organization, the uniforms are not suitable for everyday use, and you must wear them when volunteering. E-file prior year tax return I pay a babysitter to watch my children while I volunteer for a qualified organization. E-file prior year tax return Can I deduct these costs? No, you cannot deduct payments for childcare expenses as a charitable contribution, even if you would be unable to volunteer without childcare. E-file prior year tax return (If you have childcare expenses so you can work for pay, see Publication 503, Child and Dependent Care Expenses. E-file prior year tax return ) Although you cannot deduct the value of your services given to a qualified organization, you may be able to deduct some amounts you pay in giving services to a qualified organization. E-file prior year tax return The amounts must be: Unreimbursed, Directly connected with the services, Expenses you had only because of the services you gave, and Not personal, living, or family expenses. E-file prior year tax return Table 2 contains questions and answers that apply to some individuals who volunteer their services. E-file prior year tax return Underprivileged youths selected by charity. E-file prior year tax return   You can deduct reasonable unreimbursed out-of-pocket expenses you pay to allow underprivileged youths to attend athletic events, movies, or dinners. E-file prior year tax return The youths must be selected by a charitable organization whose goal is to reduce juvenile delinquency. E-file prior year tax return Your own similar expenses in accompanying the youths are not deductible. E-file prior year tax return Conventions. E-file prior year tax return   If a qualified organization selects you to attend a convention as its representative, you can deduct your unreimbursed expenses for travel, including reasonable amounts for meals and lodging, while away from home overnight for the convention. E-file prior year tax return However, see Travel , later. E-file prior year tax return   You cannot deduct personal expenses for sightseeing, fishing parties, theater tickets, or nightclubs. E-file prior year tax return You also cannot deduct travel, meals and lodging, and other expenses for your spouse or children. E-file prior year tax return   You cannot deduct your travel expenses in attending a church convention if you go only as a member of your church rather than as a chosen representative. E-file prior year tax return You can, however, deduct unreimbursed expenses that are directly connected with giving services for your church during the convention. E-file prior year tax return Uniforms. E-file prior year tax return   You can deduct the cost and upkeep of uniforms that are not suitable for everyday use and that you must wear while performing donated services for a charitable organization. E-file prior year tax return Foster parents. E-file prior year tax return   You may be able to deduct as a charitable contribution some of the costs of being a foster parent (foster care provider) if you have no profit motive in providing the foster care and are not, in fact, making a profit. E-file prior year tax return A qualified organization must select the individuals you take into your home for foster care. E-file prior year tax return   You can deduct expenses that meet both of the following requirements. E-file prior year tax return They are unreimbursed out-of-pocket expenses to feed, clothe, and care for the foster child. E-file prior year tax return They are incurred primarily to benefit the qualified organization. E-file prior year tax return   Unreimbursed expenses that you cannot deduct as charitable contributions may be considered support provided by you in determining whether you can claim the foster child as a dependent. E-file prior year tax return For details, see Publication 501, Exemptions, Standard Deduction, and Filing Information. E-file prior year tax return Example. E-file prior year tax return You cared for a foster child because you wanted to adopt her, not to benefit the agency that placed her in your home. E-file prior year tax return Your unreimbursed expenses are not deductible as charitable contributions. E-file prior year tax return Church deacon. E-file prior year tax return   You can deduct as a charitable contribution any unreimbursed expenses you have while in a permanent diaconate program established by your church. E-file prior year tax return These expenses include the cost of vestments, books, and transportation required in order to serve in the program as either a deacon candidate or an ordained deacon. E-file prior year tax return Car expenses. E-file prior year tax return   You can deduct as a charitable contribution any unreimbursed out-of-pocket expenses, such as the cost of gas and oil, directly related to the use of your car in giving services to a charitable organization. E-file prior year tax return You cannot deduct general repair and maintenance expenses, depreciation, registration fees, or the costs of tires or insurance. E-file prior year tax return   If you do not want to deduct your actual expenses, you can use a standard mileage rate of 14 cents a mile to figure your contribution. E-file prior year tax return   You can deduct parking fees and tolls whether you use your actual expenses or the standard mileage rate. E-file prior year tax return   You must keep reliable written records of your car expenses. E-file prior year tax return For more information, see Car expenses under Records To Keep, later. E-file prior year tax return Travel. E-file prior year tax return   Generally, you can claim a charitable contribution deduction for travel expenses necessarily incurred while you are away from home performing services for a charitable organization only if there is no significant element of personal pleasure, recreation, or vacation in the travel. E-file prior year tax return This applies whether you pay the expenses directly or indirectly. E-file prior year tax return You are paying the expenses indirectly if you make a payment to the charitable organization and the organization pays for your travel expenses. E-file prior year tax return   The deduction for travel expenses will not be denied simply because you enjoy providing services to the charitable organization. E-file prior year tax return Even if you enjoy the trip, you can take a charitable contribution deduction for your travel expenses if you are on duty in a genuine and substantial sense throughout the trip. E-file prior year tax return However, if you have only nominal duties, or if for significant parts of the trip you do not have any duties, you cannot deduct your travel expenses. E-file prior year tax return Example 1. E-file prior year tax return You are a troop leader for a tax-exempt youth group and you take the group on a camping trip. E-file prior year tax return You are responsible for overseeing the setup of the camp and for providing adult supervision for other activities during the entire trip. E-file prior year tax return You participate in the activities of the group and enjoy your time with them. E-file prior year tax return You oversee the breaking of camp and you transport the group home. E-file prior year tax return You can deduct your travel expenses. E-file prior year tax return Example 2. E-file prior year tax return You sail from one island to another and spend 8 hours a day counting whales and other forms of marine life. E-file prior year tax return The project is sponsored by a charitable organization. E-file prior year tax return In most circumstances, you cannot deduct your expenses. E-file prior year tax return Example 3. E-file prior year tax return You work for several hours each morning on an archeological dig sponsored by a charitable organization. E-file prior year tax return The rest of the day is free for recreation and sightseeing. E-file prior year tax return You cannot take a charitable contribution deduction even though you work very hard during those few hours. E-file prior year tax return Example 4. E-file prior year tax return You spend the entire day attending a charitable organization's regional meeting as a chosen representative. E-file prior year tax return In the evening you go to the theater. E-file prior year tax return You can claim your travel expenses as charitable contributions, but you cannot claim the cost of your evening at the theater. E-file prior year tax return Daily allowance (per diem). E-file prior year tax return   If you provide services for a charitable organization and receive a daily allowance to cover reasonable travel expenses, including meals and lodging while away from home overnight, you must include in income any part of the allowance that is more than your deductible travel expenses. E-file prior year tax return You may be able to deduct any necessary travel expenses that are more than the allowance. E-file prior year tax return Deductible travel expenses. E-file prior year tax return   These include: Air, rail, and bus transportation, Out-of-pocket expenses for your car, Taxi fares or other costs of transportation between the airport or station and your hotel, Lodging costs, and The cost of meals. E-file prior year tax return Because these travel expenses are not business-related, they are not subject to the same limits as business related expenses. E-file prior year tax return For information on business travel expenses, see Travel in Publication 463, Travel, Entertainment, Gift, and Car Expenses. E-file prior year tax return Expenses of Whaling Captains You may be able to deduct as a charitable contribution any reasonable and necessary whaling expenses you pay during the year to carry out sanctioned whaling activities. E-file prior year tax return The deduction is limited to $10,000 a year. E-file prior year tax return To claim the deduction, you must be recognized by the Alaska Eskimo Whaling Commission as a whaling captain charged with the responsibility of maintaining and carrying out sanctioned whaling activities. E-file prior year tax return Sanctioned whaling activities are subsistence bowhead whale hunting activities conducted under the management plan of the Alaska Eskimo Whaling Commission. E-file prior year tax return Whaling expenses include expenses for: Acquiring and maintaining whaling boats, weapons, and gear used in sanctioned whaling activities, Supplying food for the crew and other provisions for carrying out these activities, and Storing and distributing the catch from these activities. E-file prior year tax return You must keep records showing the time, place, date, amount, and nature of the expenses. E-file prior year tax return For details, see Revenue Procedure 2006-50, which is on page 944 of Internal Revenue Bulletin 2006-47 at www. E-file prior year tax return irs. E-file prior year tax return gov/pub/irs-irbs/irb06-47. E-file prior year tax return pdf. E-file prior year tax return Contributions You Cannot Deduct There are some contributions you cannot deduct and others you can deduct only in part. E-file prior year tax return You cannot deduct as a charitable contribution: A contribution to a specific individual, A contribution to a nonqualified organization, The part of a contribution from which you receive or expect to receive a benefit, The value of your time or services, Your personal expenses, A qualified charitable distribution from an individual retirement arrangement (IRA), Appraisal fees, Certain contributions to donor-advised funds, or Certain contributions of partial interests in property. E-file prior year tax return Detailed discussions of these items follow. E-file prior year tax return Contributions to Individuals You cannot deduct contributions to specific individuals, including the following. E-file prior year tax return Contributions to fraternal societies made for the purpose of paying medical or burial expenses of members. E-file prior year tax return Contributions to individuals who are needy or worthy. E-file prior year tax return You cannot deduct these contributions even if you make them to a qualified organization for the benefit of a specific person. E-file prior year tax return But you can deduct a contribution to a qualified organization that helps needy or worthy individuals if you do not indicate that your contribution is for a specific person. E-file prior year tax return Example. E-file prior year tax return You can deduct contributions to a qualified organization for flood relief, hurricane relief, or other disaster relief. E-file prior year tax return However, you cannot deduct contributions earmarked for relief of a particular individual or family. E-file prior year tax return Payments to a member of the clergy that can be spent as he or she wishes, such as for personal expenses. E-file prior year tax return Expenses you paid for another person who provided services to a qualified organization. E-file prior year tax return Example. E-file prior year tax return Your son does missionary work. E-file prior year tax return You pay his expenses. E-file prior year tax return You cannot claim a deduction for your son's unreimbursed expenses related to his contribution of services. E-file prior year tax return Payments to a hospital that are for a specific patient's care or for services for a specific patient. E-file prior year tax return You cannot deduct these payments even if the hospital is operated by a city, state, or other qualified organization. E-file prior year tax return Contributions to Nonqualified Organizations You cannot deduct contributions to organizations that are not qualified to receive tax-deductible contributions, including the following. E-file prior year tax return Certain state bar associations if: The bar is not a political subdivision of a state, The bar has private, as well as public, purposes, such as promoting the professional interests of members, and Your contribution is unrestricted and can be used for private purposes. E-file prior year tax return Chambers of commerce and other business leagues or organizations. E-file prior year tax return Civic leagues and associations. E-file prior year tax return Communist organizations. E-file prior year tax return Country clubs and other social clubs. E-file prior year tax return Foreign organizations other than certain Canadian, Israeli, or Mexican charitable organizations. E-file prior year tax return (See Canadian charities , Mexican charities , and Israeli charities under Organizations That Qualify To Receive Deductible Contributions, earlier. E-file prior year tax return ) Also, you cannot deduct a contribution you made to any qualifying organization if the contribution is earmarked to go to a foreign organization. E-file prior year tax return However, certain contributions to a qualified organization for use in a program conducted by a foreign charity may be deductible as long as they are not earmarked to go to the foreign charity. E-file prior year tax return For the contribution to be deductible, the qualified organization must approve the program as furthering its own exempt purposes and must keep control over the use of the contributed funds. E-file prior year tax return The contribution is also deductible if the foreign charity is only an administrative arm of the qualified organization. E-file prior year tax return Homeowners' associations. E-file prior year tax return Labor unions. E-file prior year tax return But you may be able to deduct union dues as a miscellaneous itemized deduction, subject to the 2%-of-adjusted-gross-income limit, on Schedule A (Form 1040). E-file prior year tax return See Publication 529, Miscellaneous Deductions. E-file prior year tax return Political organizations and candidates. E-file prior year tax return Contributions From Which You Benefit If you receive or expect to receive a financial or economic benefit as a result of making a contribution to a qualified organization, you cannot deduct the part of the contribution that represents the value of the benefit you receive. E-file prior year tax return See Contributions From Which You Benefit under Contributions You Can Deduct, earlier. E-file prior year tax return These contributions include the following. E-file prior year tax return Contributions for lobbying. E-file prior year tax return This includes amounts you earmark for use in, or in connection with, influencing specific legislation. E-file prior year tax return Contributions to a retirement home for room, board, maintenance, or admittance. E-file prior year tax return Also, if the amount of your contribution depends on the type or size of apartment you will occupy, it is not a charitable contribution. E-file prior year tax return Costs of raffles, bingo, lottery, etc. E-file prior year tax return You cannot deduct as a charitable contribution amounts you pay to buy raffle or lottery tickets or to play bingo or other games of chance. E-file prior year tax return For information on how to report gambling winnings and losses, see Deductions Not Subject to the 2% Limit in Publication 529. E-file prior year tax return Dues to fraternal orders and similar groups. E-file prior year tax return However, see Membership fees or dues under Contributions From Which You Benefit, earlier. E-file prior year tax return Tuition, or amounts you pay instead of tuition. E-file prior year tax return You cannot deduct as a charitable contribution amounts you pay as tuition even if you pay them for children to attend parochial schools or qualifying nonprofit daycare centers. E-file prior year tax return You also cannot deduct any fixed amount you must pay in addition to, or instead of, tuition to enroll in a private school, even if it is designated as a “donation. E-file prior year tax return ” Contributions connected with split-dollar insurance arrangements. E-file prior year tax return You cannot deduct any part of a contribution to a charitable organization if, in connection with the contribution, the organization directly or indirectly pays, has paid, or is expected to pay any premium on any life insurance, annuity, or endowment contract for which you, any member of your family, or any other person chosen by you (other than a qualified charitable organization) is a beneficiary. E-file prior year tax return Example. E-file prior year tax return You donate money to a charitable organization. E-file prior year tax return The charity uses the money to purchase a cash value life insurance policy. E-file prior year tax return The beneficiaries under the insurance policy include members of your family. E-file prior year tax return Even though the charity may eventually get some benefit out of the insurance policy, you cannot deduct any part of the donation. E-file prior year tax return Qualified Charitable Distributions A qualified charitable distribution (QCD) is a distribution made directly by the trustee of your individual retirement arrangement (IRA), other than a SEP or SIMPLE IRA, to certain qualified organizations. E-file prior year tax return You must have been at least age 70½ when the distribution was made. E-file prior year tax return Your total QCDs for the year cannot be more than $100,000. E-file prior year tax return If all the requirements are met, a QCD is nontaxable, but you cannot claim a charitable contribution deduction for a QCD. E-file prior year tax return See Publication 590, Individual Retirement Arrangements (IRAs), for more information about QCDs. E-file prior year tax return Value of Time or Services You cannot deduct the value of your time or services, including: Blood donations to the American Red Cross or to blood banks, and The value of income lost while you work as an unpaid volunteer for a qualified organization. E-file prior year tax return Personal Expenses You cannot deduct personal, living, or family expenses, such as the following items. E-file prior year tax return The cost of meals you eat while you perform services for a qualified organization, unless it is necessary for you to be away from home overnight while performing the services. E-file prior year tax return Adoption expenses, including fees paid to an adoption agency and the costs of keeping a child in your home before adoption is final. E-file prior year tax return However, you may be able to claim a tax credit for these expenses. E-file prior year tax return Also, you may be able to exclude from your gross income amounts paid or reimbursed by your employer for your adoption expenses. E-file prior year tax return See Form 8839, Qualified Adoption Expenses, and its instructions, for more information. E-file prior year tax return You also may be able to claim an exemption for the child. E-file prior year tax return See Exemptions for Dependents in Publication 501 for more information. E-file prior year tax return Appraisal Fees You cannot deduct as a charitable contribution any fees you pay to find the fair market value of donated property. E-file prior year tax return But you can claim them, subject to the 2%-of-adjusted-gross-income limit, as a miscellaneous itemized deduction on Schedule A (Form 1040). E-file prior year tax return See Deductions Subject to the 2% Limit in Publication 529 for more information. E-file prior year tax return Contributions to Donor-Advised Funds You cannot deduct a contribution to a donor-advised fund if: The qualified organization that sponsors the fund is a war veterans' organization, a fraternal society, or a nonprofit cemetery company, or You do not have an acknowledgment from that sponsoring organization that it has exclusive legal control over the assets contributed. E-file prior year tax return There are also other circumstances in which you cannot deduct your contribution to a donor-advised fund. E-file prior year tax return Generally, a donor-advised fund is a fund or account in which a donor can, because of being a donor, advise the fund how to distribute or invest amounts held in the fund. E-file prior year tax return For details, see Internal Revenue Code section 170(f)(18). E-file prior year tax return Partial Interest in Property Generally, you cannot deduct a contribution of less than your entire interest in property. E-file prior year tax return For details, see Partial Interest in Property under Contributions of Property, later. E-file prior year tax return Contributions of Property If you contribute property to a qualified organization, the amount of your charitable contribution is generally the fair market value of the property at the time of the contribution. E-file prior year tax return However, if the property has increased in value, you may have to make some adjustments to the amount of your deduction. E-file prior year tax return See Giving Property That Has Increased in Value , later. E-file prior year tax return For information about the records you must keep and the information you must furnish with your return if you donate property, see Records To Keep and How To Report , later. E-file prior year tax return Contributions Subject to Special Rules Special rules apply if you contribute: Clothing or household items, A car, boat, or airplane, Taxidermy property, Property subject to a debt, A partial interest in property, A fractional interest in tangible personal property, A qualified conservation contribution, A future interest in tangible personal property, Inventory from your business, or A patent or other intellectual property. E-file prior year tax return These special rules are described next. E-file prior year tax return Clothing and Household Items You cannot take a deduction for clothing or household items you donate unless the clothing or household items are in good used condition or better. E-file prior year tax return Exception. E-file prior year tax return   You can take a deduction for a contribution of an item of clothing or a household item that is not in good used condition or better if you deduct more than $500 for it and include a qualified appraisal of it with your return. E-file prior year tax return Household items. E-file prior year tax return   Household items include: Furniture and furnishings, Electronics, Appliances, Linens, and Other similar items. E-file prior year tax return   Household items do not include: Food, Paintings, antiques, and other objects of art, Jewelry and gems, and Collections. E-file prior year tax return Fair market value. E-file prior year tax return   To determine the fair market value of these items, use the rules under Determining Fair Market Value , later. E-file prior year tax return Cars, Boats, and Airplanes The following rules apply to any donation of a qualified vehicle. E-file prior year tax return A qualified vehicle is: A car or any motor vehicle manufactured mainly for use on public streets, roads, and highways, A boat, or An airplane. E-file prior year tax return Deduction more than $500. E-file prior year tax return   If you donate a qualified vehicle with a claimed fair market value of more than $500, you can deduct the smaller of: The gross proceeds from the sale of the vehicle by the organization, or The vehicle's fair market value on the date of the contribution. E-file prior year tax return If the vehicle's fair market value was more than your cost or other basis, you may have to reduce the fair market value to figure the deductible amount, as described under Giving Property That Has Increased in Value , later. E-file prior year tax return Form 1098-C. E-file prior year tax return   You must attach to your return Copy B of the Form 1098-C, Contributions of Motor Vehicles, Boats, and Airplanes, (or other statement containing the same information as Form 1098-C) you received from the organization. E-file prior year tax return The Form 1098-C (or other statement) will show the gross proceeds from the sale of the vehicle. E-file prior year tax return   If you e-file your return, you must: Attach Copy B of Form 1098-C to Form 8453, U. E-file prior year tax return S. E-file prior year tax return Individual Income Tax Transmittal for an IRS e-file Return, and mail the forms to the IRS, or Include Copy B of Form 1098-C as a pdf attachment if your software program allows it. E-file prior year tax return   If you do not attach Form 1098-C (or other statement), you cannot deduct your contribution. E-file prior year tax return    You must get Form 1098-C (or other statement) within 30 days of the sale of the vehicle. E-file prior year tax return But if exception 1 or 2 (described later) applies, you must get Form 1098-C (or other statement) within 30 days of your donation. E-file prior year tax return Filing deadline approaching and still no Form 1098-C. E-file prior year tax return   If the filing deadline is approaching and you still do not have a Form 1098-C, you have two choices. E-file prior year tax return Request an automatic 6-month extension of time to file your return. E-file prior year tax return You can get this extension by filing Form 4868, Application for Automatic Extension of Time To File U. E-file prior year tax return S. E-file prior year tax return Individual Income Tax Return. E-file prior year tax return For more information, see the instructions for Form 4868. E-file prior year tax return File the return on time without claiming the deduction for the qualified vehicle. E-file prior year tax return After receiving the Form 1098-C, file an amended return, Form 1040X, Amended U. E-file prior year tax return S. E-file prior year tax return Individual Income Tax Return, claiming the deduction. E-file prior year tax return Attach Copy B of Form 1098-C (or other statement) to the amended return. E-file prior year tax return Exceptions. E-file prior year tax return   There are two exceptions to the rules just described for deductions of more than $500. E-file prior year tax return Exception 1—vehicle used or improved by organization. E-file prior year tax return   If the qualified organization makes a significant intervening use of or material improvement to the vehicle before transferring it, you generally can deduct the vehicle's fair market value at the time of the contribution. E-file prior year tax return But if the vehicle's fair market value was more than your cost or other basis, you may have to reduce the fair market value to get the deductible amount, as described under Giving Property That Has Increased in Value , later. E-file prior year tax return The Form 1098-C (or other statement) will show whether this exception applies. E-file prior year tax return    Exception 2—vehicle given or sold to needy individual. E-file prior year tax return   If the qualified organization will give the vehicle, or sell it for a price well below fair market value, to a needy individual to further the organization's charitable purpose, you generally can deduct the vehicle's fair market value at the time of the contribution. E-file prior year tax return But if the vehicle's fair market value was more than your cost or other basis, you may have to reduce the fair market value to get the deductible amount, as described under Giving Property That Has Increased in Value , later. E-file prior year tax return The Form 1098-C (or other statement) will show whether this exception applies. E-file prior year tax return   This exception does not apply if the organization sells the vehicle at auction. E-file prior year tax return In that case, you cannot deduct the vehicle's fair market value. E-file prior year tax return Example. E-file prior year tax return Anita donates a used car to a qualified organization. E-file prior year tax return She bought it 3 years ago for $9,000. E-file prior year tax return A used car guide shows the fair market value for this type of car is $6,000. E-file prior year tax return However, Anita gets a Form 1098-C from the organization showing the car was sold for $2,900. E-file prior year tax return Neither exception 1 nor exception 2 applies. E-file prior year tax return If Anita itemizes her deductions, she can deduct $2,900 for her donation. E-file prior year tax return She must attach Form 1098-C and Form 8283 to her return. E-file prior year tax return Deduction $500 or less. E-file prior year tax return   If the qualified organization sells the vehicle for $500 or less and exceptions 1 and 2 do not apply, you can deduct the smaller of: $500, or The vehicle's fair market value on the date of the contribution. E-file prior year tax return But if the vehicle's fair market value was more than your cost or other basis, you may have to reduce the fair market value to get the deductible amount, as described under Giving Property That Has Increased in Value , later. E-file prior year tax return   If the vehicle's fair market value is at least $250 but not more than $500, you must have a written statement from the qualified organization acknowledging your donation. E-file prior year tax return The statement must contain the information and meet the tests for an acknowledgment described under Contributions of $250 or More under Records To Keep, later. E-file prior year tax return Fair market value. E-file prior year tax return   To determine a vehicle's fair market value, use the rules described under Determining Fair Market Value , later. E-file prior year tax return Donations of inventory. E-file prior year tax return   The vehicle donation rules just described do not apply to donations of inventory. E-file prior year tax return For example, these rules do not apply if you are a car dealer who donates a car you had been holding for sale to customers. E-file prior year tax return See Inventory , later. E-file prior year tax return Taxidermy Property If you donate taxidermy property to a qualified organization, your deduction is limited to your basis in the property or its fair market value, whichever is less. E-file prior year tax return This applies if you prepared, stuffed, or mounted the property or paid or incurred the cost of preparing, stuffing, or mounting the property. E-file prior year tax return Your basis for this purpose includes only the cost of preparing, stuffing, and mounting the property. E-file prior year tax return Your basis does not include transportation or travel costs. E-file prior year tax return It also does not include the direct or indirect costs for hunting or killing an animal, such as equipment costs. E-file prior year tax return In addition, it does not include the value of your time. E-file prior year tax return Taxidermy property means any work of art that: Is the reproduction or preservation of an animal, in whole or in part, Is prepared, stuffed, or mounted to recreate one or more characteristics of the animal, and Contains a part of the body of the dead animal. E-file prior year tax return Property Subject to a Debt If you contribute property subject to a debt (such as a mortgage), you must reduce the fair market value of the property by: Any allowable deduction for interest you paid (or will pay) that is attributable to any period after the contribution, and If the property is a bond, the lesser of: Any allowable deduction for interest you paid (or will pay) to buy or carry the bond that is attributable to any period before the contribution, or The interest, including bond discount, receivable on the bond that is attributable to any period before the contribution, and that is not includible in your income due to your accounting method. E-file prior year tax return This prevents you from deducting the same amount as both investment interest and a charitable contribution. E-file prior year tax return If the recipient (or another person) assumes the debt, you must also reduce the fair market value of the property by the amount of the outstanding debt assumed. E-file prior year tax return The amount of the debt is also treated as an amount realized on the sale or exchange of property for purposes of figuring your taxable gain (if any). E-file prior year tax return For more information, see Bargain Sales under Giving Property That Has Increased in Value, later. E-file prior year tax return Partial Interest in Property Generally, you cannot deduct a charitable contribution of less than your entire interest in property. E-file prior year tax return Right to use property. E-file prior year tax return   A contribution of the right to use property is a contribution of less than your entire interest in that property and is not deductible. E-file prior year tax return Example 1. E-file prior year tax return You own a 10-story office building and donate rent-free use of the top floor to a charitable organization. E-file prior year tax return Because you still own the building, you have contributed a partial interest in the property and cannot take a deduction for the contribution. E-file prior year tax return Example 2. E-file prior year tax return Mandy White owns a vacation home at the beach that she sometimes rents to others. E-file prior year tax return For a fund-raising auction at her church, she donated the right to use the vacation home for 1 week. E-file prior year tax return At the auction, the church received and accepted a bid from Lauren Green equal to the fair rental value of the home for 1 week. E-file prior year tax return Mandy cannot claim a deduction because of the partial interest rule. E-file prior year tax return Lauren cannot claim a deduction either, because she received a benefit equal to the amount of her payment. E-file prior year tax return See Contributions From Which You Benefit , earlier. E-file prior year tax return Exceptions. E-file prior year tax return   You can deduct a charitable contribution of a partial interest in property only if that interest represents one of the following items. E-file prior year tax return A remainder interest in your personal home or farm. E-file prior year tax return A remainder interest is one that passes to a beneficiary after the end of an earlier interest in the property. E-file prior year tax return Example. E-file prior year tax return You keep the right to live in your home during your lifetime and give your church a remainder interest that begins upon your death. E-file prior year tax return You can deduct the value of the remainder interest. E-file prior year tax return An undivided part of your entire interest. E-file prior year tax return This must consist of a part of every substantial interest or right you own in the property and must last as long as your interest in the property lasts. E-file prior year tax return But see Fractional Interest in Tangible Personal Property , later. E-file prior year tax return Example. E-file prior year tax return You contribute voting stock to a qualified organization but keep the right to vote the stock. E-file prior year tax return The right to vote is a substantial right in the stock. E-file prior year tax return You have not contributed an undivided part of your entire interest and cannot deduct your contribution. E-file prior year tax return A partial interest that would be deductible if transferred to certain types of trusts. E-file prior year tax return A qualified conservation contribution (defined later). E-file prior year tax return For information about how to figure the value of a contribution of a partial interest in property, see Partial Interest in Property Not in Trust in Publication 561. E-file prior year tax return Fractional Interest in Tangible Personal Property You cannot deduct a charitable contribution of a fractional interest in tangible personal property unless all interests in the property are held immediately before the contribution by: You, or You and the qualifying organization receiving the contribution. E-file prior year tax return If you make an additional contribution later, the fair market value of that contribution will be determined by using the smaller of: The fair market value of the property at the time of the initial contribution, or The fair market value of the property at the time of the additional contribution. E-file prior year tax return Tangible personal property is defined later under Future Interest in Tangible Personal Property . E-file prior year tax return A fractional interest in property is an undivided portion of your entire interest in the property. E-file prior year tax return Example. E-file prior year tax return An undivided one-quarter interest in a painting that entitles an art museum to possession of the painting for 3 months of each year is a fractional interest in the property. E-file prior year tax return Recapture of deduction. E-file prior year tax return   You must recapture your charitable contribution deduction by including it in your income if both of the following statements are true. E-file prior year tax return You contributed a fractional interest in tangible personal property after August 17, 2006. E-file prior year tax return You do not contribute the rest of your interests in the property to the original recipient or, if it no longer exists, another qualified organization on or before the earlier of: The date that is 10 years after the date of the initial contribution, or The date of your death. E-file prior year tax return   Recapture is also required if the qualified organization has not taken substantial physical possession of the property and used it in a way related to the organization's purpose during the period beginning on the date of the initial contribution and ending on the earlier of: The date that is 10 years after the date of the initial contribution, or The date of your death. E-file prior year tax return Additional tax. E-file prior year tax return   If you must recapture your deduction, you must also pay interest and an additional tax equal to 10% of the amount recaptured. E-file prior year tax return Qualified Conservation Contribution A qualified conservation contribution is a contribution of a qualified real property interest to a qualified organization to be used only for conservation purposes. E-file prior year tax return Qualified organization. E-file prior year tax return   For purposes of a qualified conservation contribution, a qualified organization is: A governmental unit, A publicly supported charity, or An organization controlled by, and operated for the exclusive benefit of, a governmental unit or a publicly supported charity. E-file prior year tax return The organization also must have a commitment to protect the conservation purposes of the donation and must have the resources to enforce the restrictions. E-file prior year tax return   A publicly supported charity is an organization of the type described in (1) under Types of Qualified Organizations , earlier, that normally receives a substantial part of its support, other than income from its exempt activities, from direct or indirect contributions from the general public or from governmental units. E-file prior year tax return Qualified real property interest. E-file prior year tax return   This is any of the following interests in real property. E-file prior year tax return Your entire interest in real estate other than a mineral interest (subsurface oil, gas, or other minerals, and the right of access to these minerals). E-file prior year tax return A remainder interest. E-file prior year tax return A restriction (granted in perpetuity) on the use that may be made of the real property. E-file prior year tax return Conservation purposes. E-file prior year tax return   Your contribution must be made only for one of the following conservation purposes. E-file prior year tax return Preserving land areas for outdoor recreation by, or for the education of, the general public. E-file prior year tax return Protecting a relatively natural habitat of fish, wildlife, or plants, or a similar ecosystem. E-file prior year tax return Preserving open space, including farmland and forest land, if it yields a significant public benefit. E-file prior year tax return The open space must be preserved either for the scenic enjoyment of the general public or under a clearly defined federal, state, or local governmental conservation policy. E-file prior year tax return Preserving a historically important land area or a certified historic structure. E-file prior year tax return Building in registered historic district. E-file prior year tax return   If a building in a registered historic district is a certified historic structure, a contribution of a qualified real property interest that is an easement or other restriction on the exterior of the building is deductible only if it meets all of the following conditions. E-file prior year tax return The restriction must preserve the entire exterior of the building (including its front, sides, rear, and height) and must prohibit any change to the exterior of the building that is inconsistent with its historical character. E-file prior year tax return You and the organization receiving the contribution must enter into a written agreement certifying, under penalty of perjury, that the organization: Is a qualified organization with a purpose of environmental protection, land conservation, open space preservation, or historic preservation, and Has the resources to manage and enforce the restriction and a commitment to do so. E-file prior year tax return You must include with your return: A qualified appraisal, Photographs of the building's entire exterior, and A description of all restrictions on development of the building, such as zoning laws and restrictive covenants. E-file prior year tax return   If you claimed the rehabilitation credit for the building for any of the 5 years before the year of the contribution, your charitable deduction is reduced. E-file prior year tax return For more information, see Form 3468, Investment Credit, and Internal Revenue Code section 170(f)(14). E-file prior year tax return   If you claim a deduction of more than $10,000, your deduction will not be allowed unless you pay a $500 filing fee. E-file prior year tax return See Form 8283-V, Payment Voucher for Filing Fee Under Section 170(f)(13), and its instructions. E-file prior year tax return You may be able to deduct the filing fee as a miscellaneous itemized deduction, subject to the 2%-of-adjusted-gross-income limit, on Schedule A (Form 1040). E-file prior year tax return See Deductions Subject to the 2% Limit in Publication 529 for more information. E-file prior year tax return More information. E-file prior year tax return   For information about determining the fair market value of qualified conservation contributions, see Publication 561. E-file prior year tax return For information about the limits that apply to deductions for this type of contribution, see Limits on Deductions , later. E-file prior year tax return For more information about qualified conservation contributions, see Regulations section 1. E-file prior year tax return 170A-14. E-file prior year tax return Future Interest in Tangible Personal Property You cannot deduct the value of a charitable contribution of a future interest in tangible personal property until all intervening interests in and rights to the actual possession or enjoyment of the property have either expired or been turned over to someone other than yourself, a related person, or a related organization. E-file prior year tax return But see Fractional Interest in Tangible Personal Property , earlier, and Tangible personal property put to unrelated use , later. E-file prior year tax return Related persons include your spouse, children, grandchildren, brothers, sisters, and parents. E-file prior year tax return Related organizations may include a partnership or corporation in which you have an interest, or an estate or trust with which you have a connection. E-file prior year tax return Tangible personal property. E-file prior year tax return   This is any property, other than land or buildings, that can be seen or touched. E-file prior year tax return It includes furniture, books, jewelry, paintings, and cars. E-file prior year tax return Future interest. E-file prior year tax return   This is any interest that is to begin at some future time, regardless of whether it is designated as a future interest under state law. E-file prior year tax return Example. E-file prior year tax return You own an antique car that you contribute to a museum. E-file prior year tax return You give up ownership, but retain the right to keep the car in your garage with your personal collection. E-file prior year tax return Because you keep an interest in the property, you cannot deduct the contribution. E-file prior year tax return If you turn the car over to the museum in a later year, giving up all rights to its use, possession, and enjoyment, you can take a deduction for the contribution in that later year. E-file prior year tax return Inventory If you contribute inventory (property you sell in the course of your business), the amount you can deduct is the smaller of its fair market value on the day you contributed it or its basis. E-file prior year tax return The basis of contributed inventory is any cost incurred for the inventory in an earlier year that you would otherwise include in your opening inventory for the year of the contribution. E-file prior year tax return You must remove the amount of your charitable contribution deduction from your opening inventory. E-file prior year tax return It is not part of the cost of goods sold. E-file prior year tax return If the cost of donated inventory is not included in your opening inventory, the inventory's basis is zero and you cannot claim a charitable contribution deduction. E-file prior year tax return Treat the inventory's cost as you would ordinarily treat it under your method of accounting. E-file prior year tax return For example, include the purchase price of inventory bought and donated in the same year in the cost of goods sold for that year. E-file prior year tax return A special rule applies to certain donations of food inventory. E-file prior year tax return See Food Inventory, later. E-file prior year tax return Patents and Other Intellectual Property If you donate intellectual property to a qualified organization, your deduction is limited to the basis of the property or the fair market value of the property, whichever is smaller. E-file prior year tax return Intellectual property means any of the following: Patents. E-file prior year tax return Copyrights (other than a copyright described in Internal Revenue Code sections 1221(a)(3) or 1231(b)(1)(C)). E-file prior year tax return Trademarks. E-file prior year tax return Trade names. E-file prior year tax return Trade secrets. E-file prior year tax return Know-how. E-file prior year tax return Software (other than software described in Internal Revenue Code section 197(e)(3)(A)(i)). E-file prior year tax return Other similar property or applications or registrations of such property. E-file prior year tax return Additional deduction based on income. E-file prior year tax return   You may be able to claim additional charitable contribution deductions in the year of the contribution and years following, based on the income, if any, from the donated property. E-file prior year tax return   The following table shows the percentage of income from the property that you can deduct for each of your tax years ending on or after the date of the contribution. E-file prior year tax return In the table, “tax year 1,” for example, means your first tax year ending on or after the date of the contribution. E-file prior year tax return However, you can take the additional deduction only to the extent the total of the amounts figured using this table is more than the amount of the deduction claimed for the original donation of the property. E-file prior year tax return   After the legal life of the intellectual property ends, or after the 10th anniversary of the donation, whichever is earlier, no additional deduction is allowed. E-file prior year tax return The additional deductions cannot be taken for intellectual property donated to certain private foundations. E-file prior year tax return Tax year Deductible percentage 1 100% 2 100% 3 90% 4 80% 5 70% 6 60% 7 50% 8 40% 9 30% 10 20% 11 10% 12 10% Reporting requirements. E-file prior year tax return   You must inform the organization at the time of the donation that you intend to treat the donation as a contribution subject to the provisions just discussed. E-file prior year tax return   The organization is required to file an information return showing the income from the property, with a copy to you. E-file prior year tax return This is done on Form 8899, Notice of Income From Donated Intellectual Property. E-file prior year tax return Determining Fair Market Value This section discusses general guidelines for determining the fair market value of various types of donated property. E-file prior year tax return Publication 561 contains a more complete discussion. E-file prior year tax return Fair market value is the price at which property would change hands between a willing buyer and a willing seller, neither having to buy or sell, and both having reasonable knowledge of all the relevant facts. E-file prior year tax return Used clothing. E-file prior year tax return   The fair market value of used clothing and other personal items is usually far less than the price you paid for them. E-file prior year tax return There are no fixed formulas or methods for finding the value of items of clothing. E-file prior year tax return   You should claim as the value the price that buyers of used items actually pay in used clothing stores, such as consignment or thrift shops. E-file prior year tax return      Also see Clothing and Household Items , earlier. E-file prior year tax return Example. E-file prior year tax return    Kristin donated a coat to a thrift store operated by her church. E-file prior year tax return She paid $300 for the coat 3 years ago. E-file prior year tax return Similar coats in the thrift store sell for $50. E-file prior year tax return The fair market value of the coat is $50. E-file prior year tax return Kristin's donation is limited to $50. E-file prior year tax return Household items. E-file prior year tax return   The fair market value of used household items, such as furniture, appliances, and linens, is usually much lower than the price paid when new. E-file prior year tax return These items may have little or no market value because they are in a worn condition, out of style, or no longer useful. E-file prior year tax return For these reasons, formulas (such as using a percentage of the cost to buy a new replacement item) are not acceptable in determining value. E-file prior year tax return   You should support your valuation with photographs, canceled checks, receipts from your purchase of the items, or other evidence. E-file prior year tax return Magazine or newspaper articles and photographs that describe the items and statements by the recipients of the items are also useful. E-file prior year tax return Do not include any of this evidence with your tax return. E-file prior year tax return   If the property is valuable because it is old or unique, see the discussion under Paintings, Antiques, and Other Objects of Art in Publication 561. E-file prior year tax return   Also see Clothing and Household Items , earlier. E-file prior year tax return Cars, boats, and airplanes. E-file prior year tax return   If you contribute a car, boat, or airplane to a charitable organization, you must determine its fair market value. E-file prior year tax return Boats. E-file prior year tax return   Except for small, inexpensive boats, the valuation of boats should be based on an appraisal by a marine surveyor or appraiser because the physical condition is critical to the value. E-file prior year tax return Cars. E-file prior year tax return   Certain commercial firms and trade organizations publish used car pricing guides, commonly called “blue books,” containing complete dealer sale prices or dealer average prices for recent model years. E-file prior year tax return The guides may be published monthly or seasonally, and for different regions of the country. E-file prior year tax return These guides also provide estimates for adjusting for unusual equipment, unusual mileage, and physical condition. E-file prior year tax return The prices are not “official” and these publications are not considered an appraisal of any specific donated property. E-file prior year tax return But they do provide clues for making an appraisal and suggest relative prices for comparison with current sales and offerings in your area. E-file prior year tax return   These publications are sometimes available from public libraries, or from the loan officer at a bank, credit union, or finance company. E-file prior year tax return You can also find used car pricing information on the Internet. E-file prior year tax return   To find the fair market value of a donated car, use the price listed in a used car guide for a private party sale, not the dealer retail value. E-file prior year tax return However, the fair market value may be less if the car has engine trouble, body damage, high mileage, or any type of excessive wear. E-file prior year tax return The fair market value of a donated car is the same as the price listed in a used car guide for a private party sale only if the guide lists a sales price for a car that is the same make, model, and year, sold in the same area, in the same condition, with the same or similar options or accessories, and with the same or similar warranties as the donated car. E-file prior year tax return Example. E-file prior year tax return You donate a used car in poor condition to a local high school for use by students studying car repair. E-file prior year tax return A used car guide shows the dealer retail value for this type of car in poor condition is $1,600. E-file prior year tax return However, the guide shows the price for a private party sale of the car is only $750. E-file prior year tax return The fair market value of the car is considered to be $750. E-file prior year tax return Large quantities. E-file prior year tax return   If you contribute a large number of the same item, fair market value is the price at which comparable numbers of the item are being sold. E-file prior year tax return Example. E-file prior year tax return You purchase 500 bibles for $1,000. E-file prior year tax return The person who sells them to you says the retail value of these bibles is $3,000. E-file prior year tax return If you contribute the bibles to a qualified organization, you can claim a deduction only for the price at which similar numbers of the same bible are currently being sold. E-file prior year tax return Your charitable contribution is $1,000, unless you can show that similar numbers of that bible wer
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SOI Tax Stats - SOI Working Papers

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Statistics of Income Working Papers

The Statistics of Income (SOI) working papers present new and exciting research on the U.S. Federal tax system and the methods used to produce tax statistics. Papers are presented at professional conferences, such as the Joint Statistical Meeting of the American Statistical Association and the National Tax Association’s annual conference on taxation, and are often published in professional journals. Below you will find a selection of papers organized by presentation year.

Papers in this series generally do not undergo the extensive review and editorial process accorded official SOI publications. Instead, these working papers are intended to make results of research available to others and to encourage discussion on a variety of topics. As a result, papers may be occasionally revised or updated.

Jump to a year:

1997  1998  1999  2000  2001  2002  2003  2004  2005  2006  2007  2008  2009  2011  2013  2014


2014

Older Taxpayers’ Response to Taxation of Social Security Benefits
Leonard Burman, Syracuse University and the Tax Policy Center, Norma B. Coe, University of Washington and the National Bureau of Economic Research, Kevin Pierce, Internal Revenue Service, Liu Tian, Syracuse University

Over the Top: How Tax Returns Show that the Very Rich Are Different from You and Me
Jenny Bourne and Lisa Rosenmerkel

The Economic Impact of Tax Expenditures: Evidence from Spatial Variation Across the U.S.
Associated Tables (.xls format)
Raj Chetty and Nathaniel Hendren, Harvard University and the National Bureau of Economic Research, and, Patrick Kline and Emmanuel Saez, University of California, Berkeley and the National Bureau of Economic Research

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2013

The Home Mortgage Interest Deduction and Migratory Insurance Over the Great Recession
Danny Yagan, University of California, Berkeley

Do Financial Frictions Amplify Fiscal Policy? Evidence from Business Investment Stimulus
Eric Zwick and James Mahon, Harvard University

A New Look at the Income-Wealth Connection for America’s Wealthiest Decedents
Barry Johnson, Brian Raub, and Joseph Newcomb, Statistics of Income, IRS

A Comparison of Wealth Estimates For America’s Wealthiest Decedents Using Tax Data and Data From The Forbes 400
Barry Johnson, Brian Raub, and Joseph Newcomb, Statistics of Income, IRS

Capital Tax Reform and the Real Economy: The Effects of the 2003 Dividend Tax Cut
Danny Yagan, University of California, Berkeley

Do Tax Credits for Parents Affect Child College Enrollment?
Nathaniel G. Hilger, Brown University

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2011

New Evidence on the Long-Term Impacts of Tax Credits
Raj Chetty and JohnFriedman, Harvard University and the National Bureau of Economic Research, and Jonah Rockoff, Columbia University and the National Bureau of Economic Research

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2009

Variance Estimation for Estimators of Between-Year Change in Totals from Two Stratified Bernoulli Samples
Henry, Kimberly; Testa, Valerie; Valliant, Richard

The Effect of Late-Filed Returns on Population Estimates: A Comparative Analysis
Raub, Brian; Belmonte, Cynthia; Arnsberger, Paul; Ludlum, Melissa

Variance Estimation for Estimators of Between-Year Change in Totals from Two Stratified Bernoulli Samples
Kimberly Henry and Valerie Testa, Internal Revenue Service and Richard Valliant, University of Michigan

The Effect of Late-Filed Returns on Population Estimates: A Comparative Analysis
Brian Raub, Cynthia Belmonte, Paul Arnsberger, and Melissa Ludlum, Internal Revenue Service

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2008

Dissemination Of Statistical Products: The IRS’s Journey
Gangi, Martha Eller

Attrition in the Individual Income Tax Return Panel, Tax Years 1999–2005
Bryant, Victoria

Statistics of Income Sales of Capital Assets Sample Redesign for Tax Year 2007
Liu, Yan; Scali, Jana; Strudler, Michael; Wilson, Janette

90 Years of SOI: A Collection of Historical Articles
Multiple Authors

Using Audit Data To Estimate Taxpayer Reporting Error in the Statistics of Income Division's Individual Tax Return Sample
Henry, Kimberly

Differences in Income Estimates Derived from Survey and Tax Data
Johnson, Barry; Moore, Kevin

Old Tabulations, Old Files, and a Brief History of Individual Tax Return Sampling
Weber, Michael; Paris, David; Sailer, Peter

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2007

Measuring Disclosure Risk and an Examination of the Possibilities of Using Synthetic Data in the Individual Income Tax Return Public Use File
Vartivarian, Sonya; Czajka, John; Weber, Michael

Measuring the Quality of Service to Taxpayers in Volunteer Sites
Cecco, Kevin; Walsh, Ronald; Hooker, Rachael

SOI Develops Better Survey Questions Through Pretesting
Milleville, Diane; Wells, Tara

Using the Statistics of Income Division's Sample Data To Reduce Measurement and Processing Error in Small-Area Estimates Produced from Administrative Tax Records
Henry, Kimberly; Lahiri, Partha; Fisher, Robin

An Empirical Evaluation of Various Direct, Synthetic, and Traditional Composite Small-Area Estimators
Henry, Kimberly; Strudler, Michael; Chen, William

Evaluating Alternative One-Sided Coverage Intervals for an Extreme Binomial Proportion
Liu, Yan; Kott, Phillip

Improving the Quality of U.S. Tax Statistics: Recent Innovations in Editing and Imputation Techniques at the Statistics of Income Division of the U.S. Internal Revenue Service
Scott M. Hollenbeck, Melissa Ludlum, and Barry W. Johnson, Internal Revenue Service

Using an Individual Income Tax Panel File To Measure Changes in Marginal Tax Rates: Opportunities
Diamond, John; Rector, Ralph; Weber, Michael

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2006

Social Security Taxes, Social Security Benefits, and Social Security Benefits Taxation, 2003
Sailer, Peter; Pierce, Kevin; Lomize, Evgenia

Analysis of the Distributions of Income, Taxes, and Payroll Taxes via Cross Section and Panel Data, 1979–2004
Strudler, Michael; Hentz, Lori; Petska, Tom; Petska, Ryan

Performance Measurement within the Statistics of Income Division
Cecco, Kevin

Customer Satisfaction Initiatives at IRS’s Statistics of Income: Using Surveys to Improve Customer Service
Schwartz, Ruth; Kilss, Beth

Tying Website Performance to Mission Achievement in the Federal Government
Milleville, Diane

The Tax Year 1999–2003 Individual Income Tax Return Panel: A First Look at the Data
Weber, Michael

Application of an Evolutionary Algorithm to Multivariate Optimal Allocation in Stratified Sample Designs
Day, Charles

Factors in Estates’ Utilization of Special Tax Provisions for Family-Owned Farms and Closely Held Businesses
Gangi, Martha Eller; Henry, Kimberly; Raub, Brian

Corporation Life Cycles: Examining Attrition Trends and Return Characteristics in Statistics of Income Cross-Sectional 1120 Samples
Matthew L. Scoffic

An Analysis of the Free File Program
Chu, Michelle; Kovalick, Melissa

Comparing Strategies To Estimate a Measure of Heteroscedasticity
Henry, Kimberly; Valliant, Richard

Creativity and Compromise: Constructing a Panel of Income and Estate Tax Data for Wealthy Individuals
Johnson, Barry; Schreiber, Lisa

Monitoring Statistics of Income (SOI) Samples
Koshansky, Joseph

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2005

Trends in 401(k) and IRA Contribution Activity, 1999–2002—Results from a Panel of Matched Tax Returns and Information Documents
Sailer, Peter; Bryant, Victoria Holden, Sarah

The 1999 Individual Income Tax Return Edited Panel
Weber, Michael; Bryant, Victoria

A Cluster Analysis Approach To Describing Tax Data
Raub, Brian; Chen, William

Origins of the Estate and Personal Wealth Sample Design
McMahon, Paul

Corporation Supercritical Cases: How Do Imputed Returns on the Corporate File Compare to the Actual Returns?
Davitian, Lucy

Internal Revenue Service Area-To-Area Migration Data: Strengths, Limitations, and Current Trends
Gross, Emily

A Comparison of Income Concepts: IRS Statistics of Income, Census Current Population Survey, and BLS Consumer Expenditure Survey
Henry, Eric; Day, Charles

Measuring Nonsampling Error in the Statistics of Income Individual Tax Return Study
Scali, Jana; Testa, Valerie; Kahr, Maureen; Strudler, Michael

The Impact of the Followup Process on the 2002 Foreign Tax Credit Study Data
Singmaster, Rob; Redmiles, Lissa

Prelude to Schedule M–3: Schedule M–1 Corporate Book-Tax Difference Data, 1990–2003
Boynton, Charles; DeFilippes, Portia; Legel, Ellen

An Essay on the Effects of Taxation on the Corporate Financial Policy
Contos, George

An Analysis of Business Organizational Structure and Activity from Tax Data
Petska, Tom; Parisi, Michael; Luttrell, Kelly; Davitian, Lucy; Scoffic, Matt

Geographic Variation in Schedule H Filing Rates: Why Should Location Influence the Decision To Report Nanny Taxes?
Bloomquist, Kim; An, Zhiyong

Current Research in the Nonprofit Sector
Arnsberger, Paul; Ludlum, Melissa; Riley, Margaret

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2004

Use of Individual Retirement Arrangements to Save for Retirement—Results From a Matched File of Tax Returns and Information Documents for Tax Year 2001
Sailer, Peter; Holden, Sarah

Further Analysis of the Distribution of Income and Taxes, 1979–2003
Strudler, Michael; Petska, Tom; Petska, Ryan

The Statistics of Income 1979–2002 Continuous Work History Sample Individual Income Tax Return Panel
Weber, Michael

Assessing Industry Codes on the IRS Business Master File
McMahon, Paul

Customer Satisfaction Initiatives within the Statistics of Income Division of the Internal Revenue Service
Cecco, Kevin

The Evolution of IRS Telephone Quality Measures
Rosage, Laura

Some New Tables for Upper Probability Points of the Largest Root of a Determinantal Equation
Chen, William

Editor Judgment Effect: Modeling a Key Component of Nonsampling Error in Administrative Data
Henry, Kimberly; Ahmed, Yahia; Legel, Ellen

The Effect of Content Errors on Bias and Nonsampling Variance in Estimates Derived From Samples
Johnson, Barry; Jacobson,Darien B.

Data Interpretation across Sources: A Study of Form 990–PF Information Collected from Multiple Databases
Ludlum, Melissa

Recent Research on Small Business Compliance Burden
Guyton, John; Kindlon, Audrey; Zhou, Jian

The Mismeasure of Man’s Well-Being: Refining Realized Income Measures with Wealth, Portfolio, and Mortality Information
Johnson, Barry; Wahl, Jenny

Tax Evasion and Entrepreneurship: The Effect of Income Reporting Policies on Evasion. An Experimental Approach
Alm, James; Deskins, John; McKee, Michael

Audit Information Dissemination, Taxpayer Communication and Tax Compliance: An Experimental Investigation of Indirect Audit Effects
Alm, James; Jackson, Betty; McKee, Michael

Multi-Agent Based Simulation of the Deterrent Effects of Taxpayer Audits
Bloomquist, Kim

Developing Adoptable Disclosure Protection Techniques: Lessons Learned From a U.S. Experience
Greenia, Nicholas

Consider the Source: Differences in Income Estimates Derived from Survey and Tax Data
Johnson, Barry; Moore, Kevin

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2003

The Effects of Tax Reform on the Structure of U.S. Business
Legel, Ellen; Bennett, Kelly; Parisi, Michael

Accumulation and Distributions of Retirement Assets, 1996–2000—Results from a Matched File of Tax Returns and Information Returns
Sailer, Peter; Gurka, Kurt; Holden, Sarah

An Analysis of the Distribution of Individual Income and Taxes, 1979–2001
Strudler, Michael; Petska, Tom; Petska, Ryan

IRS Seeks to Develop New Web-Based Measurement Indicators for IRS.gov
Dixon, Diane

Statistical Information Services at IRS: Improving Dissemination of Data and Satisfying the Customer
Kilss, Beth; Jordan, David

Recent Efforts to Maximize Benefits from the Statistics of Income Advisory Panel
Petska, Tom; Kilss, Beth

Regulatory Exemptions and Item Nonresponse
McMahon, Paul

Comparing Scoring Systems From Cluster Analysis and Discriminant Analysis Using Random Samples
Wong, William; Ho, Chih-Chin

Estimating the Compliance Cost of the U.S. Individual Income Tax
Toder, Eric J.; Guyton, John; O'Hare, John; Stavrianos, Michael

Tax Evasion, Income Inequality and Opportunity Costs of Compliance
Bloomquist, Kim

IRS's Comprehensive Approach to Compliance Measurement
Brown, Robert; Mazur, Mark

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2002

Salaries and Wages and Deferred Income, 1989–1999
Sailer, Peter; Yau, Ellen; Gurka, Kurt; Weber, Michael

Proxies in Administrative Records Surveys
McMahon, Paul

Assessing Disclosure Protection for a SOI Public Use File
Winglee, Marianne; Valliant, Richard; Clark, Jay; Lim, Yunhee; Weber, Michael; Strudler, Michael

Electronic Dissemination of Internal Revenue Service Locality Data
Gross, Emily; Kilss, Beth

Analysis of the 1998 Gift Tax Panel Study
Eller, Martha Britton; Rib, Tamara

Evaluating the Effect of Sample Size Changes on Scoring System Performance Using Bootstraps and Random Samples
Wong, William; Ho, Chih-Chin

Using Auxiliary Information to Adjust for Non-Response in Weighting a Linked Sample of Administrative Records
Johnson, Barry: McMahon, Paul

Developing an Econometric Model for Measuring Tax Noncompliance Using Operational Audit Data
Erard, Brian; Ho, Chih-Chin

Some New Tables of the Largest Root of a Matrix in Multivariate Analysis: A Computer Approach from 2 to 6
Chen, William

Are Taxpayers Increasing the Buildup of Retirement Assets? Preliminary Results from a Matched File of Tax Year 1999 Tax Returns and Information Returns
Sailer, Peter; Weber, Michael; Gurka, Kurt

New Estimates of the Distribution of Individual Income and Taxes
Strudler, Michael; Petska, Tom; Petska, Ryan

How the Quality of Responses the IRS Provides to Taxpayer Inquiries is Measured
Cecco, Kevin; Hoopengardner, Rachael

The Impact of the IRS on Voluntary Tax Compliance: Preliminary Empirical Results
Plumley, Alan

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2001

Taxing Charity: Linking Income Tax Returns to Samples of Nonexempt Charitable and Charitable Remainder
Belvedere, Melissa; Mikow, Jacob; Whitten, Melissa

The 1998 Gift Tax Panel Study: Using The IRS Returns Transaction File as a Sample Frame
Eller, Martha Britton; Rib, Tamara

Sample Design Revisions in the Wake of NAICS and Regulatory Changes
McMahon, Paul

Statistical Information from Administrative Records in the Federal Tax System
Petska, Tom

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2000

Exporting a Statistical System: Towards Establishing a Tax Statistics Function in South Africa
Petska, Tom

Beyond Andrew Carnegie: Using a Linked Sample of Federal Income and Estate Tax Returns to Examine the Effects of Bequests on Beneficiary Behavior
Mikow, Jacob; Berkowitz, Darien

Statistical Consulting Within the Internal Revenue Service
Cecco, Kevin; Walsh, Ronald

Attrition in a Panel of Individual Income Tax Returns, 1992–1997
Sailer, Peter; Weber, Michael; Wong, William

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1999

The Distribution of Individual Income and Taxes: A New Look at an Old Issue
Petska, Tom; Strudler, Mike

Personal Wealth, 1995
Johnson, Barry

Further Examination of the Distribution of Individual Income and Taxes Using a Consistent and Comprehensive Measure of Income
Petska, Tom; Strudler, Mike; Petska, Ryan

Customer Service Satisfaction Survey: Cognitive and Prototype Test
Cecco, Kevin; Young, Anthony

On Computing Gaussian Curvature of Some Well Known Distributions
Chen, William

The Feasiblity of State Corporate Data
Francis, Brian

Using a Sample of Federal Estate Tax Returns to Examine the Effects of Audit Revaluation on Pre-Audit Estimates
Eller, Martha Britton; Johnson, Barry

Occupation and Industry Data from Tax Year 1993 Individual Tax Returns
Sailer, Peter; Nuriddin, Terry

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1998

Income, Tax, and Tax Progressivity: An Examination of Recent Trends in the Distribution of Individual Income and Taxes
Petska, Tom; Strudler, Mike

Updating Techniques for Estimating Wealth from Federal Estate Tax Returns
Johnson, Barry

The IRS Population Count: An Update
Sailer, Peter; Weber, Michael

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1997

Taxes and Business Organizational Choice: Deja Vu All Over Again?
Petska, Tom

Partnerships in Data Sharing: The Internal Revenue Service and the Bureau of Economic Analysis
Petska, Tom

Federal Taxation of Inheritance and Wealth Transfers
Johnson, Barry; Eller, Martha Britton

Household and Individual Income Data from Tax Returns
Sailer, Peter; Weber, Michael

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Page Last Reviewed or Updated: 10-Mar-2014

The E-file Prior Year Tax Return

E-file prior year tax return 5. E-file prior year tax return   Exemptions, Deductions, and Credits Table of Contents Topics - This chapter discusses: Useful Items - You may want to see: Items Related to Excluded Income Exemptions Contributions to Foreign Charitable Organizations Moving ExpensesAllocation of Moving Expenses Forms To File Contributions to Individual Retirement Arrangements Taxes of Foreign Countries and U. E-file prior year tax return S. E-file prior year tax return PossessionsCredit for Foreign Income Taxes Deduction for Foreign Income Taxes Deduction for Other Foreign Taxes How To Report Deductions Topics - This chapter discusses: The rules concerning items related to excluded income, Exemptions, Contributions to foreign charitable organizations, Moving expenses, Contributions to individual retirement arrangements (IRAs), Taxes of foreign countries and U. E-file prior year tax return S. E-file prior year tax return possessions, and How to report deductions. E-file prior year tax return Useful Items - You may want to see: Publication 501 Exemptions, Standard Deduction, and Filing Information 514 Foreign Tax Credit for Individuals 521 Moving Expenses 523 Selling Your Home 590 Individual Retirement Arrangements (IRAs) 597 Information on the United States—Canada Income Tax Treaty Form (and Instructions) 1116 Foreign Tax Credit 2106 Employee Business Expenses 2555 Foreign Earned Income 2555-EZ Foreign Earned Income Exclusion 3903 Moving Expenses Schedule A (Form 1040) Itemized Deductions Schedule C (Form 1040) Profit or Loss From Business SS-5 Application for a Social Security Card W-7 Application for IRS Individual Taxpayer Identification Number See chapter 7 for information about getting these publications and forms. E-file prior year tax return Items Related to Excluded Income U. E-file prior year tax return S. E-file prior year tax return citizens and resident aliens living outside the United States generally are allowed the same deductions as citizens and residents living in the United States. E-file prior year tax return If you choose to exclude foreign earned income or housing amounts, you cannot deduct, exclude, or claim a credit for any item that can be allocated to or charged against the excluded amounts. E-file prior year tax return This includes any expenses, losses, and other normally deductible items that are allocable to the excluded income. E-file prior year tax return You can deduct only those expenses connected with earning includible income. E-file prior year tax return These rules apply only to items definitely related to the excluded earned income and they do not apply to other items that are not definitely related to any particular type of gross income. E-file prior year tax return These rules do not apply to items such as: Personal exemptions, Qualified retirement contributions, Alimony payments, Charitable contributions, Medical expenses, Mortgage interest, or Real estate taxes on your personal residence. E-file prior year tax return For purposes of these rules, your housing deduction is not treated as allocable to your excluded income, but the deduction for self- employment tax is. E-file prior year tax return If you receive foreign earned income in a tax year after the year in which you earned it, you may have to file an amended return for the earlier year to properly adjust the amounts of deductions, credits, or exclusions allocable to your foreign earned income and housing exclusions. E-file prior year tax return Example. E-file prior year tax return In 2012, you had $90,400 of foreign earned income and $9,500 of deductions allocable to your foreign earned income. E-file prior year tax return You did not have a housing exclusion. E-file prior year tax return Because you excluded all of your foreign earned income, you would not have been able to claim any of the deductions on your 2012 return. E-file prior year tax return In 2013, you received a $12,000 bonus for work you did abroad in 2012. E-file prior year tax return You can exclude $4,700 of the bonus because the limit on the foreign earned income exclusion for 2012 was $95,100 and you have already excluded $90,400. E-file prior year tax return Since you must include $7,300 of the bonus ($12,000 − $4,700) for work you did in 2012 in income, you can file an amended return for 2012 to claim $677 of the deductions. E-file prior year tax return This is the deductions allocable to the foreign earned income ($9,500) multiplied by the includible portion of the foreign earned income ($7,300) and divided by the total foreign earned income for 2012 ($102,400). E-file prior year tax return Exemptions You can claim an exemption for your nonresident alien spouse on your separate return, provided your spouse has no gross income for U. E-file prior year tax return S. E-file prior year tax return tax purposes and is not the dependent of another U. E-file prior year tax return S. E-file prior year tax return taxpayer. E-file prior year tax return You also can claim exemptions for individuals who qualify as your dependents. E-file prior year tax return To be your dependent, the individual must be a U. E-file prior year tax return S. E-file prior year tax return citizen, U. E-file prior year tax return S. E-file prior year tax return national, U. E-file prior year tax return S. E-file prior year tax return resident alien, or a resident of Canada or Mexico for some part of the calendar year in which your tax year begins. E-file prior year tax return Children. E-file prior year tax return   Children usually are citizens or residents of the same country as their parents. E-file prior year tax return If you were a U. E-file prior year tax return S. E-file prior year tax return citizen when your child was born, your child generally is a U. E-file prior year tax return S. E-file prior year tax return citizen. E-file prior year tax return This is true even if the child's other parent is a nonresident alien, the child was born in a foreign country, and the child lives abroad with the other parent. E-file prior year tax return   If you have a legally adopted child who is not a U. E-file prior year tax return S. E-file prior year tax return citizen, U. E-file prior year tax return S. E-file prior year tax return resident, or U. E-file prior year tax return S. E-file prior year tax return national, the child meets the citizen requirement if you are a U. E-file prior year tax return S. E-file prior year tax return citizen or U. E-file prior year tax return S. E-file prior year tax return national and the child lived with you as a member of your household all year. E-file prior year tax return Social security number. E-file prior year tax return   You must include on your return the social security number (SSN) of each dependent for whom you claim an exemption. E-file prior year tax return To get a social security number for a dependent, apply at a Social Security office or U. E-file prior year tax return S. E-file prior year tax return consulate. E-file prior year tax return You must provide original or certified copies of documents to verify the dependent's age, identity, and citizenship, and complete Form SS-5. E-file prior year tax return   If you do not have an SSN for a child who was born in 2013 and died in 2013, attach a copy of the child's birth certificate to your tax return. E-file prior year tax return Print “Died” in column (2) of line 6c of your Form 1040 or Form 1040A. E-file prior year tax return   If your dependent is a nonresident alien who is not eligible to get a social security number, you must list the dependent's individual taxpayer identification number (ITIN) instead of an SSN. E-file prior year tax return To apply for an ITIN, file Form W-7 with the IRS. E-file prior year tax return It usually takes 6 to 10 weeks to get an ITIN. E-file prior year tax return Enter your dependent's ITIN wherever an SSN is requested on your tax return. E-file prior year tax return More information. E-file prior year tax return   For more information about exemptions, see Publication 501. E-file prior year tax return Contributions to Foreign Charitable Organizations If you make contributions directly to a foreign church or other foreign charitable organization, you generally cannot deduct them. E-file prior year tax return Exceptions are explained under Canadian, Mexican, and Israeli charities, later. E-file prior year tax return You can deduct contributions to a U. E-file prior year tax return S. E-file prior year tax return organization that transfers funds to a charitable foreign organization if the U. E-file prior year tax return S. E-file prior year tax return organization controls the use of the funds by the foreign organization or if the foreign organization is just an administrative arm of the U. E-file prior year tax return S. E-file prior year tax return organization. E-file prior year tax return Canadian, Mexican, and Israeli charities. E-file prior year tax return   Under the income tax treaties with Canada, Mexico and Israel, you may be able to deduct contributions to certain Canadian, Mexican, and Israeli charitable organizations. E-file prior year tax return Generally, you must have income from sources in Canada, Mexico, or Israel, and the organization must meet certain requirements. E-file prior year tax return See Publication 597, Information on the United States-Canada Income Tax Treaty, and Publication 526, Charitable Contributions, for more information. E-file prior year tax return Moving Expenses If you moved to a new home in 2013 because of your job or business, you may be able to deduct the expenses of your move. E-file prior year tax return Generally, to be deductible, the moving expenses must have been paid or incurred in connection with starting work at a new job location. E-file prior year tax return See Publication 521 for a complete discussion of the deduction for moving expenses and information about moves within the United States. E-file prior year tax return Foreign moves. E-file prior year tax return   A foreign move is a move in connection with the start of work at a new job location outside the United States and its possessions. E-file prior year tax return A foreign move does not include a move back to the United States or its possessions. E-file prior year tax return Allocation of Moving Expenses When your new place of work is in a foreign country, your moving expenses are directly connected with the income earned in that foreign country. E-file prior year tax return If you exclude all or part of the income that you earn at the new location under the foreign earned income exclusion or the foreign housing exclusion, you cannot deduct the part of your moving expense that is allocable to the excluded income. E-file prior year tax return Also, you cannot deduct the part of the moving expense related to the excluded income for a move from a foreign country to the United States if you receive a reimbursement that you are able to treat as compensation for services performed in the foreign country. E-file prior year tax return Year to which expense is connected. E-file prior year tax return   The moving expense is connected with earning the income (including reimbursements, as discussed in chapter 4 under Reimbursement of moving expenses ) either entirely in the year of the move or in 2 years. E-file prior year tax return It is connected with earning the income entirely in the year of the move if you qualify for the foreign earned income exclusion under the bona fide residence test or physical presence test for at least 120 days during that tax year. E-file prior year tax return   If you do not qualify under either the bona fide residence test or the physical presence test for at least 120 days during the year of the move, the expense is connected with earning the income in 2 years. E-file prior year tax return The moving expense is connected with the year of the move and the following year if the move is from the United States to a foreign country. E-file prior year tax return The moving expense is connected with the year of the move and the preceding year if the move is from a foreign country to the United States. E-file prior year tax return Amount allocable to excluded income. E-file prior year tax return   To figure the amount of your moving expense that is allocable to your excluded foreign earned income (and not deductible), you must multiply your total moving expense deduction by a fraction. E-file prior year tax return The numerator (top number) of the fraction is the total of your excluded foreign earned income and housing amounts for both years and the denominator (bottom number) of the fraction is your total foreign earned income for both years. E-file prior year tax return Example. E-file prior year tax return On November 1, 2012, you transfer to Monaco. E-file prior year tax return Your tax home is in Monaco, and you are a bona fide resident of Monaco for the entire tax year 2013. E-file prior year tax return In 2012, you paid $6,000 for allowable moving expenses for your move from the United States to Monaco. E-file prior year tax return You were fully reimbursed (under a nonaccountable plan) for these expenses in the same year. E-file prior year tax return The reimbursement is included in your income. E-file prior year tax return Your only other income consists of $16,000 wages earned in 2012 after the date of your move, and $100,100 wages earned in Monaco for 2013. E-file prior year tax return Because you did not meet the bona fide residence test for at least 120 days during 2012, the year of the move, the moving expenses are for services you performed in both 2012 and the following year, 2013. E-file prior year tax return Your total foreign earned income for both years is $122,100, consisting of $16,000 wages for 2012, $100,100 wages for 2013, and $6,000 moving expense reimbursement for both years. E-file prior year tax return You have no housing exclusion. E-file prior year tax return The total amount you can exclude is $113,190, consisting of the $97,600 full-year exclusion for 2013 and a $15,590 part-year exclusion for 2012 ($95,100 times the fraction of 60 qualifying bona fide residence days over 366 total days in the year). E-file prior year tax return To find the part of your moving expenses that is not deductible, multiply your $6,000 total expenses by the fraction $113,190 over $122,100. E-file prior year tax return The result, $5,562, is your nondeductible amount. E-file prior year tax return    You must report the full amount of the moving expense reimbursement in the year in which you received the reimbursement. E-file prior year tax return In the preceding example, this year was 2012. E-file prior year tax return You attribute the reimbursement to both 2012 and 2013 only to figure the amount of foreign earned income eligible for exclusion for each year. E-file prior year tax return Move between foreign countries. E-file prior year tax return   If you move between foreign countries, your moving expense is allocable to income earned in the year of the move if you qualified under either the bona fide residence test or the physical presence test for a period that includes at least 120 days in the year of the move. E-file prior year tax return New place of work in U. E-file prior year tax return S. E-file prior year tax return   If your new place of work is in the United States, the deductible moving expenses are directly connected with the income earned in the United States. E-file prior year tax return If you treat a reimbursement from your employer as foreign earned income (see the discussion in chapter 4), you must allocate deductible moving expenses to foreign earned income. E-file prior year tax return Storage expenses. E-file prior year tax return   These expenses are attributable to work you do during the year in which you incur the storage expenses. E-file prior year tax return You cannot deduct the amount allocable to excluded income. E-file prior year tax return Moving Expense Attributable to Foreign Earnings in 2 Years If your moving expense deduction is attributable to your foreign earnings in 2 years (the year of the move and the following year), you should request an extension of time to file your return for the year of the move until after the end of the second year. E-file prior year tax return By then, you should have all the information needed to properly figure the moving expense deduction. E-file prior year tax return See Extensions under When To File and Pay in chapter 1. E-file prior year tax return If you do not request an extension, you should figure the part of the moving expense that you cannot deduct because it is allocable to the foreign earned income you are excluding. E-file prior year tax return You do this by multiplying the moving expense by a fraction, the numerator (top number) of which is your excluded foreign earned income for the year of the move, and the denominator (bottom number) of which is your total foreign earned income for the year of the move. E-file prior year tax return Once you know your foreign earnings and exclusion for the following year, you must either: Adjust the moving expense deduction by filing an amended return for the year of the move, or Recapture any additional unallowable amount as income on your return for the following year. E-file prior year tax return If, after you make the final computation, you have an additional amount of allowable moving expense deduction, you can claim this only on an amended return for the year of the move. E-file prior year tax return You cannot claim it on the return for the second year. E-file prior year tax return Forms To File Report your moving expenses on Form 3903. E-file prior year tax return Report your moving expense deduction on line 26 of Form 1040. E-file prior year tax return If you must reduce your moving expenses by the amount allocable to excluded income (as explained later under How To Report Deductions ), attach a statement to your return showing how you figured this amount. E-file prior year tax return For more information about figuring moving expenses, see Publication 521. E-file prior year tax return Contributions to Individual Retirement Arrangements Contributions to your individual retirement arrangements (IRAs) that are traditional IRAs or Roth IRAs are generally limited to the lesser of $5,500 ($6,500 if 50 or older) or your compensation that is includible in your gross income for the tax year. E-file prior year tax return In determining compensation for this purpose, do not take into account amounts you exclude under either the foreign earned income exclusion or the foreign housing exclusion. E-file prior year tax return Do not reduce your compensation by the foreign housing deduction. E-file prior year tax return If you are covered by an employer retirement plan at work, your deduction for your contributions to your traditional IRAs is generally limited based on your modified adjusted gross income. E-file prior year tax return This is your adjusted gross income figured without taking into account the foreign earned income exclusion, the foreign housing exclusion, or the foreign housing deduction. E-file prior year tax return Other modifications are also required. E-file prior year tax return For more information on IRAs, see Publication 590. E-file prior year tax return Taxes of Foreign Countries and U. E-file prior year tax return S. E-file prior year tax return Possessions You can take either a credit or a deduction for income taxes paid to a foreign country or a U. E-file prior year tax return S. E-file prior year tax return possession. E-file prior year tax return Taken as a deduction, foreign income taxes reduce your taxable income. E-file prior year tax return Taken as a credit, foreign income taxes reduce your tax liability. E-file prior year tax return You must treat all foreign income taxes the same way. E-file prior year tax return If you take a credit for any foreign income taxes, you cannot deduct any foreign income taxes. E-file prior year tax return However, you may be able to deduct other foreign taxes. E-file prior year tax return See Deduction for Other Foreign Taxes, later. E-file prior year tax return There is no rule to determine whether it is to your advantage to take a deduction or a credit for foreign income taxes. E-file prior year tax return In most cases, it is to your advantage to take foreign income taxes as a tax credit, which you subtract directly from your U. E-file prior year tax return S. E-file prior year tax return tax liability, rather than as a deduction in figuring taxable income. E-file prior year tax return However, if foreign income taxes were imposed at a high rate and the proportion of foreign income to U. E-file prior year tax return S. E-file prior year tax return income is small, a lower final tax may result from deducting the foreign income taxes. E-file prior year tax return In any event, you should figure your tax liability both ways and then use the one that is better for you. E-file prior year tax return You can make or change your choice within 10 years from the due date for filing the tax return on which you are entitled to take either the deduction or the credit. E-file prior year tax return Foreign income taxes. E-file prior year tax return   These are generally income taxes you pay to any foreign country or possession of the United States. E-file prior year tax return Foreign income taxes on U. E-file prior year tax return S. E-file prior year tax return return. E-file prior year tax return   Foreign income taxes can only be taken as a credit on Form 1040, line 47, or as an itemized deduction on Schedule A. E-file prior year tax return These amounts cannot be included as withheld income taxes on Form 1040, line 62. E-file prior year tax return Foreign taxes paid on excluded income. E-file prior year tax return   You cannot take a credit or deduction for foreign income taxes paid on earnings you exclude from tax under any of the following. E-file prior year tax return Foreign earned income exclusion. E-file prior year tax return Foreign housing exclusion. E-file prior year tax return Possession exclusion. E-file prior year tax return If your wages are completely excluded, you cannot deduct or take a credit for any of the foreign taxes paid on your wages. E-file prior year tax return   If only part of your wages is excluded, you cannot deduct or take a credit for the foreign income taxes allocable to the excluded part. E-file prior year tax return You find the taxes allocable to your excluded wages by applying a fraction to the foreign taxes paid on foreign earned income received during the tax year. E-file prior year tax return The numerator (top number) of the fraction is your excluded foreign earned income received during the tax year minus deductible expenses allocable to that income (not including the foreign housing deduction). E-file prior year tax return The denominator (bottom number) of the fraction is your total foreign earned income received during the tax year minus all deductible expenses allocable to that income (including the foreign housing deduction). E-file prior year tax return   If foreign law taxes both earned income and some other type of income and the taxes on the other type cannot be separated, the denominator of the fraction is the total amount of income subject to foreign tax minus deductible expenses allocable to that income. E-file prior year tax return    If you take a foreign tax credit for tax on income you could have excluded under your choice to exclude foreign earned income or your choice to exclude foreign housing costs, one or both of the choices may be considered revoked. E-file prior year tax return Credit for Foreign Income Taxes If you take the foreign tax credit, you may have to file Form 1116 with Form 1040. E-file prior year tax return Form 1116 is used to figure the amount of foreign tax paid or accrued that can be claimed as a foreign tax credit. E-file prior year tax return Do not include the amount of foreign tax paid or accrued as withheld federal income taxes on Form 1040, line 62. E-file prior year tax return The foreign income tax for which you can claim a credit is the amount of legal and actual tax liability you pay or accrue during the year. E-file prior year tax return The amount for which you can claim a credit is not necessarily the amount withheld by the foreign country. E-file prior year tax return You cannot take a foreign tax credit for income tax you paid to a foreign country that would be refunded by the foreign country if you made a claim for refund. E-file prior year tax return Subsidies. E-file prior year tax return   If a foreign country returns your foreign tax payments to you in the form of a subsidy, you cannot claim a foreign tax credit based on these payments. E-file prior year tax return This rule applies to a subsidy provided by any means that is determined, directly or indirectly, by reference to the amount of tax, or to the base used to figure the tax. E-file prior year tax return   Some ways of providing a subsidy are refunds, credits, deductions, payments, or discharges of obligations. E-file prior year tax return A credit is also not allowed if the subsidy is given to a person related to you, or persons who participated in a transaction or a related transaction with you. E-file prior year tax return Limit The foreign tax credit is limited to the part of your total U. E-file prior year tax return S. E-file prior year tax return tax that is in proportion to your taxable income from sources outside the United States compared to your total taxable income. E-file prior year tax return The allowable foreign tax credit cannot be more than your actual foreign tax liability. E-file prior year tax return Exemption from limit. E-file prior year tax return   You will not be subject to this limit and will not have to file Form 1116 if you meet all three of the following requirements. E-file prior year tax return Your only foreign source income for the year is passive income (dividends, interest, royalties, etc. E-file prior year tax return ) that is reported to you on a payee statement (such as a Form 1099-DIV or 1099-INT). E-file prior year tax return Your foreign taxes for the year that qualify for the credit are not more than $300 ($600 if you are filing a joint return) and are reported on a payee statement. E-file prior year tax return You elect this procedure. E-file prior year tax return If you make this election, you cannot carry back or carry over any unused foreign tax to or from this year. E-file prior year tax return Separate limit. E-file prior year tax return   You must figure the limit on a separate basis with regard to “passive category income” and “general category income” (see the instructions for Form 1116). E-file prior year tax return Figuring the limit. E-file prior year tax return   In figuring taxable income in each category, you take into account only the amount that you must include in income on your federal tax return. E-file prior year tax return Do not take any excluded amount into account. E-file prior year tax return   To determine your taxable income in each category, deduct expenses and losses that are definitely related to that income. E-file prior year tax return   Other expenses (such as itemized deductions or the standard deduction) not definitely related to specific items of income must be apportioned to the foreign income in each category by multiplying them by a fraction. E-file prior year tax return The numerator (top number) of the fraction is your gross foreign income in the separate limit category. E-file prior year tax return The denominator (bottom number) of the fraction is your gross income from all sources. E-file prior year tax return For this purpose, gross income includes income that is excluded under the foreign earned income provisions but does not include any other exempt income. E-file prior year tax return You must use special rules for deducting interest expenses. E-file prior year tax return For more information on allocating and apportioning your deductions, see Publication 514. E-file prior year tax return Exemptions. E-file prior year tax return   Do not take the deduction for exemptions for yourself, your spouse, or your dependents in figuring taxable income for purposes of the limit. E-file prior year tax return Recapture of foreign losses. E-file prior year tax return   If you have an overall foreign loss and the loss reduces your U. E-file prior year tax return S. E-file prior year tax return source income (resulting in a reduction of your U. E-file prior year tax return S. E-file prior year tax return tax liability), you must recapture the loss in later years when you have taxable income from foreign sources. E-file prior year tax return This is done by treating a part of your taxable income from foreign sources in later years as U. E-file prior year tax return S. E-file prior year tax return source income. E-file prior year tax return This reduces the numerator of the limiting fraction and the resulting foreign tax credit limit. E-file prior year tax return Recapture of domestic losses. E-file prior year tax return   If you have an overall domestic loss (resulting in no U. E-file prior year tax return S. E-file prior year tax return tax liability), you cannot claim a foreign tax credit for taxes paid during that year. E-file prior year tax return You must recapture the loss in later years when you have U. E-file prior year tax return S. E-file prior year tax return source taxable income. E-file prior year tax return This is done by treating a part of your taxable income from U. E-file prior year tax return S. E-file prior year tax return sources in later years as foreign source income. E-file prior year tax return This increases the numerator of the limiting fraction and the resulting foreign tax credit limit. E-file prior year tax return Foreign tax credit carryback and carryover. E-file prior year tax return   The amount of foreign income tax not allowed as a credit because of the limit can be carried back 1 year and carried forward 10 years. E-file prior year tax return   More information on figuring the foreign tax credit can be found in Publication 514. E-file prior year tax return Deduction for Foreign Income Taxes Instead of taking the foreign tax credit, you can deduct foreign income taxes as an itemized deduction on Schedule A (Form 1040). E-file prior year tax return You can deduct only foreign income taxes paid on income that is subject to U. E-file prior year tax return S. E-file prior year tax return tax. E-file prior year tax return You cannot deduct foreign taxes paid on earnings you exclude from tax under any of the following. E-file prior year tax return Foreign earned income exclusion. E-file prior year tax return Foreign housing exclusion. E-file prior year tax return Possession exclusion. E-file prior year tax return Example. E-file prior year tax return You are a U. E-file prior year tax return S. E-file prior year tax return citizen and qualify to exclude your foreign earned income. E-file prior year tax return Your excluded wages in Country X are $70,000 on which you paid income tax of $10,000. E-file prior year tax return You received dividends from Country X of $2,000 on which you paid income tax of $600. E-file prior year tax return You can deduct the $600 tax payment because the dividends relating to it are subject to U. E-file prior year tax return S. E-file prior year tax return tax. E-file prior year tax return Because you exclude your wages, you cannot deduct the income tax of $10,000. E-file prior year tax return If you exclude only a part of your wages, see the earlier discussion under Foreign taxes paid on excluded income. E-file prior year tax return Deduction for Other Foreign Taxes You can deduct real property taxes you pay that are imposed on you by a foreign country. E-file prior year tax return You take this deduction on Schedule A (Form 1040). E-file prior year tax return You cannot deduct other foreign taxes, such as personal property taxes, unless you incurred the expenses in a trade or business or in the production of income. E-file prior year tax return On the other hand, you generally can deduct personal property taxes when you pay them to U. E-file prior year tax return S. E-file prior year tax return possessions. E-file prior year tax return But if you claim the possession exclusion, see Publication 570. E-file prior year tax return The deduction for foreign taxes other than foreign income taxes is not related to the foreign tax credit. E-file prior year tax return You can take deductions for these miscellaneous foreign taxes and also claim the foreign tax credit for income taxes imposed by a foreign country. E-file prior year tax return How To Report Deductions If you exclude foreign earned income or housing amounts, how you show your deductions on your tax return and how you figure the amount allocable to your excluded income depends on whether the expenses are used in figuring adjusted gross income (Form 1040, line 38) or are itemized deductions. E-file prior year tax return If you have deductions used in figuring adjusted gross income, enter the total amount for each of these items on the appropriate lines and schedules of Form 1040. E-file prior year tax return Generally, you figure the amount of a deduction related to the excluded income by multiplying the deduction by a fraction, the numerator of which is your foreign earned income exclusion and the denominator of which is your foreign earned income. E-file prior year tax return Enter the amount of the deduction(s) related to excluded income on line 44 of Form 2555. E-file prior year tax return If you have itemized deductions related to excluded income, enter on Schedule A (Form 1040) only the part not related to excluded income. E-file prior year tax return You figure that amount by subtracting from the total deduction the amount related to excluded income. E-file prior year tax return Generally, you figure the amount that is related to the excluded income by multiplying the total deduction by a fraction, the numerator of which is your foreign earned income exclusion and the denominator of which is your foreign earned income. E-file prior year tax return Attach a statement to your return showing how you figured the deductible amount. E-file prior year tax return Example 1. E-file prior year tax return You are a U. E-file prior year tax return S. E-file prior year tax return citizen employed as an accountant. E-file prior year tax return Your tax home is in Germany for the entire tax year. E-file prior year tax return You meet the physical presence test. E-file prior year tax return Your foreign earned income for the year was $122,000 and your investment income was $10,380. E-file prior year tax return After excluding $97,600, your AGI is $34,780. E-file prior year tax return You had unreimbursed business expenses of $2,500 for travel and entertainment in earning your foreign income, of which $500 was for meals and entertainment. E-file prior year tax return These expenses are deductible only as miscellaneous deductions on Schedule A (Form 1040). E-file prior year tax return You also have $500 of miscellaneous expenses that are not related to your foreign income that you enter on line 23 of Schedule A. E-file prior year tax return You must fill out Form 2106. E-file prior year tax return On that form, reduce your deductible meal and entertainment expenses by 50% ($250). E-file prior year tax return You must reduce the remaining $2,250 of travel and entertainment expenses by 80% ($1,800) because you excluded 80% ($97,600/$122,000) of your foreign earned income. E-file prior year tax return You carry the remaining total of $450 to line 21 of Schedule A. E-file prior year tax return Add the $450 to the $500 that you have on line 23 and enter the total ($950) on line 24. E-file prior year tax return On line 26 of Schedule A, enter $696, which is 2% of your adjusted gross income of $34,780 (line 38, Form 1040) and subtract it from the amount on line 24. E-file prior year tax return Enter $254 on line 27 of Schedule A. E-file prior year tax return Example 2. E-file prior year tax return You are a U. E-file prior year tax return S. E-file prior year tax return citizen, have a tax home in Spain, and meet the physical presence test. E-file prior year tax return You are self-employed and personal services produce the business income. E-file prior year tax return Your gross income was $116,931, business expenses $66,895, and net income (profit) $50,036. E-file prior year tax return You choose the foreign earned income exclusion and exclude $97,600 of your gross income. E-file prior year tax return Since your excluded income is 83. E-file prior year tax return 47% of your total income, 83. E-file prior year tax return 47% of your business expenses are not deductible. E-file prior year tax return Report your total income and expenses on Schedule C (Form 1040). E-file prior year tax return On Form 2555 you will show the following: Line 20a, $116,931, gross income, Lines 42 and 43, $97,600, foreign earned income exclusion, and Line 44, $55,837 (83. E-file prior year tax return 47% × $66,895) business expenses attributable to the exclusion. E-file prior year tax return In this situation (Example 2), you cannot use Form 2555-EZ since you had self-employment income and business expenses. E-file prior year tax return Example 3. E-file prior year tax return Assume in Example 2 that both capital and personal services combine to produce the business income. E-file prior year tax return No more than 30% of your net income, or $15,011, assuming that this amount is a reasonable allowance for your services, is considered earned and can be excluded. E-file prior year tax return Your exclusion of $15,011 is 12. E-file prior year tax return 84% of your gross income ($15,011 ÷ $116,931). E-file prior year tax return Because you excluded 12. E-file prior year tax return 84% of your total income, $8,589 (. E-file prior year tax return 1284 x $66,895) of your business expenses is attributable to the excluded income and is not deductible. E-file prior year tax return Example 4. E-file prior year tax return You are a U. E-file prior year tax return S. E-file prior year tax return citizen, have a tax home in Brazil, and meet the physical presence test. E-file prior year tax return You are self-employed and both capital and personal services combine to produce business income. E-file prior year tax return Your gross income was $146,000, business expenses were $172,000, and your net loss was $26,000. E-file prior year tax return A reasonable allowance for the services you performed for the business is $77,000. E-file prior year tax return Because you incurred a net loss, the earned income limit of 30% of your net profit does not apply. E-file prior year tax return The $77,000 is foreign earned income. E-file prior year tax return If you choose to exclude the $77,000, you exclude 52. E-file prior year tax return 74% of your gross income ($77,000 ÷ $146,000), and 52. E-file prior year tax return 74% of your business expenses ($90,713) is attributable to that income and is not deductible. E-file prior year tax return Show your total income and expenses on Schedule C (Form 1040). E-file prior year tax return On Form 2555, exclude $77,000 and show $90,713 on line 44. E-file prior year tax return Subtract line 44 from line 43, and enter the difference as a negative (in parentheses) on line 45. E-file prior year tax return Because this amount is negative, enter it as a positive (no parentheses) on line 21, Form 1040, and combine it with your other income to arrive at total income on line 22 of Form 1040. E-file prior year tax return In this situation (Example 4), you would probably not want to choose the foreign earned income exclusion if this was the first year you were eligible. E-file prior year tax return If you had chosen the exclusion in an earlier year, you might want to revoke the choice for this year. E-file prior year tax return To do so would mean that you could not claim the exclusion again for the next 5 tax years without IRS approval. E-file prior year tax return See Choosing the Exclusion in chapter 4. E-file prior year tax return Example 5. E-file prior year tax return You are a U. E-file prior year tax return S. E-file prior year tax return citizen, have a tax home in Panama, and meet the bona fide residence test. E-file prior year tax return You have been performing services for clients as a partner in a firm that provides services exclusively in Panama. E-file prior year tax return Capital investment is not material in producing the partnership's income. E-file prior year tax return Under the terms of the partnership agreement, you are to receive 50% of the net profits. E-file prior year tax return The partnership received gross income of $244,000 and incurred operating expenses of $98,250. E-file prior year tax return Of the net profits of $145,750, you received $72,875 as your distributive share. E-file prior year tax return You choose to exclude $97,600 of your share of the gross income. E-file prior year tax return Because you exclude 80% ($97,600 ÷ $122,000) of your share of the gross income, you cannot deduct $39,300, 80% of your share of the operating expenses (. E-file prior year tax return 80 × $49,125). E-file prior year tax return Report $72,875, your distributive share of the partnership net profit, on Schedule E (Form 1040), Supplemental Income and Loss. E-file prior year tax return On Form 2555, show $97,600 on line 42 and show $39,300 on line 44. E-file prior year tax return Your exclusion on Form 2555 is $58,300. E-file prior year tax return In this situation (Example 5), you cannot use Form 2555-EZ since you had earned income other than salaries and wages and you had business expenses. E-file prior year tax return Prev  Up  Next   Home   More Online Publications