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Efile online for free today 5. Efile online for free today   Additional Rules for Listed Property Table of Contents Introduction Useful Items - You may want to see: What Is Listed Property?Passenger Automobiles Other Property Used for Transportation Computers and Related Peripheral Equipment Can Employees Claim a Deduction? What Is the Business-Use Requirement?How To Allocate Use Qualified Business Use Recapture of Excess Depreciation Lessee's Inclusion Amount Do the Passenger Automobile Limits Apply?Maximum Depreciation Deduction Deductions After the Recovery Period Deductions For Passenger Automobiles Acquired in a Trade-in What Records Must Be Kept?Adequate Records How Is Listed Property Information Reported? Introduction This chapter discusses the deduction limits and other special rules that apply to certain listed property. Efile online for free today Listed property includes cars and other property used for transportation, property used for entertainment, and certain computers. Efile online for free today Deductions for listed property (other than certain leased property) are subject to the following special rules and limits. Efile online for free today Deduction for employees. Efile online for free today If your use of the property is not for your employer's convenience or is not required as a condition of your employment, you cannot deduct depreciation or rent expenses for your use of the property as an employee. Efile online for free today Business-use requirement. Efile online for free today If the property is not used predominantly (more than 50%) for qualified business use, you cannot claim the section 179 deduction or a special depreciation allowance. Efile online for free today In addition, you must figure any depreciation deduction under the Modified Accelerated Cost Recovery System (MACRS) using the straight line method over the ADS recovery period. Efile online for free today You may also have to recapture (include in income) any excess depreciation claimed in previous years. Efile online for free today A similar inclusion amount applies to certain leased property. Efile online for free today Passenger automobile limits and rules. Efile online for free today Annual limits apply to depreciation deductions (including section 179 deductions and any special depreciation allowance) for certain passenger automobiles. Efile online for free today You can continue to deduct depreciation for the unrecovered basis resulting from these limits after the end of the recovery period. Efile online for free today This chapter defines listed property and explains the special rules and depreciation deduction limits that apply, including the special inclusion amount rule for leased property. Efile online for free today It also discusses the recordkeeping rules for listed property and explains how to report information about the property on your tax return. Efile online for free today Useful Items - You may want to see: Publication 463 Travel, Entertainment, Gift, and Car Expenses 535 Business Expenses 587 Business Use of Your Home (Including Use by Daycare Providers) Form (and Instructions) 2106 Employee Business Expenses 2106-EZ Unreimbursed Employee Business Expenses 4562 Depreciation and Amortization 4797 Sales of Business Property See chapter 6 for information about getting publications and forms. Efile online for free today What Is Listed Property? Listed property is any of the following. Efile online for free today Passenger automobiles (as defined later). Efile online for free today Any other property used for transportation, unless it is an excepted vehicle. Efile online for free today Property generally used for entertainment, recreation, or amusement (including photographic, phonographic, communication, and video-recording equipment). Efile online for free today Computers and related peripheral equipment, unless used only at a regular business establishment and owned or leased by the person operating the establishment. Efile online for free today A regular business establishment includes a portion of a dwelling unit that is used both regularly and exclusively for business as discussed in Publication 587. Efile online for free today Improvements to listed property. Efile online for free today   An improvement made to listed property that must be capitalized is treated as a new item of depreciable property. Efile online for free today The recovery period and method of depreciation that apply to the listed property as a whole also apply to the improvement. Efile online for free today For example, if you must depreciate the listed property using the straight line method, you also must depreciate the improvement using the straight line method. Efile online for free today Passenger Automobiles A passenger automobile is any four-wheeled vehicle made primarily for use on public streets, roads, and highways and rated at 6,000 pounds or less of unloaded gross vehicle weight (6,000 pounds or less of gross vehicle weight for trucks and vans). Efile online for free today It includes any part, component, or other item physically attached to the automobile at the time of purchase or usually included in the purchase price of an automobile. Efile online for free today The following vehicles are not considered passenger automobiles for these purposes. Efile online for free today An ambulance, hearse, or combination ambulance-hearse used directly in a trade or business. Efile online for free today A vehicle used directly in the trade or business of transporting persons or property for pay or hire. Efile online for free today A truck or van that is a qualified nonpersonal use vehicle. Efile online for free today Qualified nonpersonal use vehicles. Efile online for free today   Qualified nonpersonal use vehicles are vehicles that by their nature are not likely to be used more than a minimal amount for personal purposes. Efile online for free today They include the trucks and vans listed as excepted vehicles under Other Property Used for Transportation , next. Efile online for free today They also include trucks and vans that have been specially modified so that they are not likely to be used more than a minimal amount for personal purposes, such as by installation of permanent shelving and painting the vehicle to display advertising or the company's name. Efile online for free today For a detailed discussion of passenger automobiles, including leased passenger automobiles, see  Publication 463. Efile online for free today Other Property Used for Transportation Although vehicles used to transport persons or property for pay or hire and vehicles rated at more than the 6,000-pound threshold are not passenger automobiles, they are still “other property used for transportation” and are subject to the special rules for listed property. Efile online for free today Other property used for transportation includes trucks, buses, boats, airplanes, motorcycles, and any other vehicles used to transport persons or goods. Efile online for free today Excepted vehicles. Efile online for free today   Other property used for transportation does not include the following qualified nonpersonal use vehicles (defined earlier under Passenger Automobiles ). Efile online for free today Clearly marked police and fire vehicles. Efile online for free today Unmarked vehicles used by law enforcement officers if the use is officially authorized. Efile online for free today Ambulances used as such and hearses used as such. Efile online for free today Any vehicle with a loaded gross vehicle weight of over 14,000 pounds that is designed to carry cargo. Efile online for free today Bucket trucks (cherry pickers), cement mixers, dump trucks (including garbage trucks), flatbed trucks, and refrigerated trucks. Efile online for free today Combines, cranes and derricks, and forklifts. Efile online for free today Delivery trucks with seating only for the driver, or only for the driver plus a folding jump seat. Efile online for free today Qualified moving vans. Efile online for free today Qualified specialized utility repair trucks. Efile online for free today School buses used in transporting students and employees of schools. Efile online for free today Other buses with a capacity of at least 20 passengers that are used as passenger buses. Efile online for free today Tractors and other special purpose farm vehicles. Efile online for free today Clearly marked police and fire vehicle. Efile online for free today   A clearly marked police or fire vehicle is a vehicle that meets all the following requirements. Efile online for free today It is owned or leased by a governmental unit or an agency or instrumentality of a governmental unit. Efile online for free today It is required to be used for commuting by a police officer or fire fighter who, when not on a regular shift, is on call at all times. Efile online for free today It is prohibited from being used for personal use (other than commuting) outside the limit of the police officer's arrest powers or the fire fighter's obligation to respond to an emergency. Efile online for free today It is clearly marked with painted insignia or words that make it readily apparent that it is a police or fire vehicle. Efile online for free today A marking on a license plate is not a clear marking for these purposes. Efile online for free today Qualified moving van. Efile online for free today   A qualified moving van is any truck or van used by a professional moving company for moving household or business goods if the following requirements are met. Efile online for free today No personal use of the van is allowed other than for travel to and from a move site or for minor personal use, such as a stop for lunch on the way from one move site to another. Efile online for free today Personal use for travel to and from a move site happens no more than five times a month on average. Efile online for free today Personal use is limited to situations in which it is more convenient to the employer, because of the location of the employee's residence in relation to the location of the move site, for the van not to be returned to the employer's business location. Efile online for free today Qualified specialized utility repair truck. Efile online for free today   A truck is a qualified specialized utility repair truck if it is not a van or pickup truck and all the following apply. Efile online for free today The truck was specifically designed for and is used to carry heavy tools, testing equipment, or parts. Efile online for free today Shelves, racks, or other permanent interior construction has been installed to carry and store the tools, equipment, or parts and would make it unlikely that the truck would be used, other than minimally, for personal purposes. Efile online for free today The employer requires the employee to drive the truck home in order to be able to respond in emergency situations for purposes of restoring or maintaining electricity, gas, telephone, water, sewer, or steam utility services. Efile online for free today Computers and Related Peripheral Equipment A computer is a programmable, electronically activated device capable of accepting information, applying prescribed processes to the information, and supplying the results of those processes with or without human intervention. Efile online for free today It consists of a central processing unit with extensive storage, logic, arithmetic, and control capabilities. Efile online for free today Related peripheral equipment is any auxiliary machine which is designed to be controlled by the central processing unit of a computer. Efile online for free today The following are neither computers nor related peripheral equipment. Efile online for free today Any equipment that is an integral part of other property that is not a computer. Efile online for free today Typewriters, calculators, adding and accounting machines, copiers, duplicating equipment, and similar equipment. Efile online for free today Equipment of a kind used primarily for the user's amusement or entertainment, such as video games. Efile online for free today Can Employees Claim a Deduction? If you are an employee, you can claim a depreciation deduction for the use of your listed property (whether owned or rented) in performing services as an employee only if your use is a business use. Efile online for free today The use of your property in performing services as an employee is a business use only if both the following requirements are met. Efile online for free today The use is for your employer's convenience. Efile online for free today The use is required as a condition of your employment. Efile online for free today If these requirements are not met, you cannot deduct depreciation (including the section 179 deduction) or rent expenses for your use of the property as an employee. Efile online for free today Employer's convenience. Efile online for free today   Whether the use of listed property is for your employer's convenience must be determined from all the facts. Efile online for free today The use is for your employer's convenience if it is for a substantial business reason of the employer. Efile online for free today The use of listed property during your regular working hours to carry on your employer's business generally is for the employer's convenience. Efile online for free today Condition of employment. Efile online for free today   Whether the use of listed property is a condition of your employment depends on all the facts and circumstances. Efile online for free today The use of property must be required for you to perform your duties properly. Efile online for free today Your employer does not have to require explicitly that you use the property. Efile online for free today However, a mere statement by the employer that the use of the property is a condition of your employment is not sufficient. Efile online for free today Example 1. Efile online for free today Virginia Sycamore is employed as a courier with We Deliver, which provides local courier services. Efile online for free today She owns and uses a motorcycle to deliver packages to downtown offices. Efile online for free today We Deliver explicitly requires all delivery persons to own a car or motorcycle for use in their employment. Efile online for free today Virginia's use of the motorcycle is for the convenience of We Deliver and is required as a condition of employment. Efile online for free today Example 2. Efile online for free today Bill Nelson is an inspector for Uplift, a construction company with many sites in the local area. Efile online for free today He must travel to these sites on a regular basis. Efile online for free today Uplift does not furnish an automobile or explicitly require him to use his own automobile. Efile online for free today However, it pays him for any costs he incurs in traveling to the various sites. Efile online for free today The use of his own automobile or a rental automobile is for the convenience of Uplift and is required as a condition of employment. Efile online for free today Example 3. Efile online for free today Assume the same facts as in Example 2 except that Uplift furnishes a car to Bill, who chooses to use his own car and receive payment for using it. Efile online for free today The use of his own car is neither for the convenience of Uplift nor required as a condition of employment. Efile online for free today Example 4. Efile online for free today Marilyn Lee is a pilot for Y Company, a small charter airline. Efile online for free today Y requires pilots to obtain 80 hours of flight time annually in addition to flight time spent with the airline. Efile online for free today Pilots usually can obtain these hours by flying with the Air Force Reserve or by flying part-time with another airline. Efile online for free today Marilyn owns her own airplane. Efile online for free today The use of her airplane to obtain the required flight hours is neither for the convenience of the employer nor required as a condition of employment. Efile online for free today Example 5. Efile online for free today David Rule is employed as an engineer with Zip, an engineering contracting firm. Efile online for free today He occasionally takes work home at night rather than work late in the office. Efile online for free today He owns and uses a home computer which is virtually identical to the office model. Efile online for free today His use of the computer is neither for the convenience of his employer nor required as a condition of employment. Efile online for free today What Is the Business-Use Requirement? You can claim the section 179 deduction and a special depreciation allowance for listed property and depreciate listed property using GDS and a declining balance method if the property meets the business-use requirement. Efile online for free today To meet this requirement, listed property must be used predominantly (more than 50% of its total use) for qualified business use. Efile online for free today If this requirement is not met, the following rules apply. Efile online for free today Property not used predominantly for qualified business use during the year it is placed in service does not qualify for the section 179 deduction. Efile online for free today Property not used predominantly for qualified business use during the year it is placed in service does not qualify for a special depreciation allowance. Efile online for free today Any depreciation deduction under MACRS for property not used predominantly for qualified business use during any year must be figured using the straight line method over the ADS recovery period. Efile online for free today This rule applies each year of the recovery period. Efile online for free today Excess depreciation on property previously used predominantly for qualified business use must be recaptured (included in income) in the first year in which it is no longer used predominantly for qualified business use. Efile online for free today A lessee must add an inclusion amount to income in the first year in which the leased property is not used predominantly for qualified business use. Efile online for free today Being required to use the straight line method for an item of listed property not used predominantly for qualified business use is not the same as electing the straight line method. Efile online for free today It does not mean that you have to use the straight line method for other property in the same class as the item of listed property. Efile online for free today Exception for leased property. Efile online for free today   The business-use requirement generally does not apply to any listed property leased or held for leasing by anyone regularly engaged in the business of leasing listed property. Efile online for free today   You are considered regularly engaged in the business of leasing listed property only if you enter into contracts for the leasing of listed property with some frequency over a continuous period of time. Efile online for free today This determination is made on the basis of the facts and circumstances in each case and takes into account the nature of your business in its entirety. Efile online for free today Occasional or incidental leasing activity is insufficient. Efile online for free today For example, if you lease only one passenger automobile during a tax year, you are not regularly engaged in the business of leasing automobiles. Efile online for free today An employer who allows an employee to use the employer's property for personal purposes and charges the employee for the use is not regularly engaged in the business of leasing the property used by the employee. Efile online for free today How To Allocate Use To determine whether the business-use requirement is met, you must allocate the use of any item of listed property used for more than one purpose during the year among its various uses. Efile online for free today For passenger automobiles and other means of transportation, allocate the property's use on the basis of mileage. Efile online for free today You determine the percentage of qualified business use by dividing the number of miles you drove the vehicle for business purposes during the year by the total number of miles you drove the vehicle for all purposes (including business miles) during the year. Efile online for free today For other listed property, allocate the property's use on the basis of the most appropriate unit of time the property is actually used (rather than merely being available for use). Efile online for free today For example, you can determine the percentage of business use of a computer by dividing the number of hours you used the computer for business purposes during the year by the total number of hours you used the computer for all purposes (including business use) during the year. Efile online for free today Entertainment use. Efile online for free today   Treat the use of listed property for entertainment, recreation, or amusement purposes as a business use only to the extent you can deduct expenses (other than interest and property tax expenses) due to its use as an ordinary and necessary business expense. Efile online for free today Commuting use. Efile online for free today   The use of an automobile for commuting is not business use, regardless of whether work is performed during the trip. Efile online for free today For example, a business telephone call made on a car telephone while commuting to work does not change the character of the trip from commuting to business. Efile online for free today This is also true for a business meeting held in a car while commuting to work. Efile online for free today Similarly, a business call made on an otherwise personal trip does not change the character of a trip from personal to business. Efile online for free today The fact that an automobile is used to display material that advertises the owner's or user's trade or business does not convert an otherwise personal use into business use. Efile online for free today Use of your automobile by another person. Efile online for free today   If someone else uses your automobile, do not treat that use as business use unless one of the following conditions applies. Efile online for free today That use is directly connected with your business. Efile online for free today You properly report the value of the use as income to the other person and withhold tax on the income where required. Efile online for free today You are paid a fair market rent. Efile online for free today Treat any payment to you for the use of the automobile as a rent payment for purposes of item (3). Efile online for free today Employee deductions. Efile online for free today   If you are an employee, do not treat your use of listed property as business use unless it is for your employer's convenience and is required as a condition of your employment. Efile online for free today See Can Employees Claim a Deduction , earlier. Efile online for free today Qualified Business Use Qualified business use of listed property is any use of the property in your trade or business. Efile online for free today However, it does not include the following uses. Efile online for free today The leasing of property to any 5% owner or related person (to the extent the property is used by a 5% owner or person related to the owner or lessee of the property). Efile online for free today The use of property as pay for the services of a 5% owner or related person. Efile online for free today The use of property as pay for services of any person (other than a 5% owner or related person), unless the value of the use is included in that person's gross income and income tax is withheld on that amount where required. Efile online for free today Property does not stop being used predominantly for qualified business use because of a transfer at death. Efile online for free today Exception for leasing or compensatory use of aircraft. Efile online for free today   Treat the leasing of any aircraft by a 5% owner or related person, or the compensatory use of any aircraft, as a qualified business use if at least 25% of the total use of the aircraft during the year is for a qualified business use. Efile online for free today 5% owner. Efile online for free today   For a business entity that is not a corporation, a 5% owner is any person who owns more than 5% of the capital or profits interest in the business. Efile online for free today   For a corporation, a 5% owner is any person who owns, or is considered to own, either of the following. Efile online for free today More than 5% of the outstanding stock of the corporation. Efile online for free today Stock possessing more than 5% of the total combined voting power of all stock in the corporation. Efile online for free today Related persons. Efile online for free today   For a description of related persons, see Related persons in the discussion on property owned or used in 1986 under What Method Can You Use To Depreciate Your Property in chapter 1 . Efile online for free today For this purpose, however, treat as related persons only the relationships listed in items (1) through (10) of that discussion and substitute “50%” for “10%” each place it appears. Efile online for free today Examples. Efile online for free today   The following examples illustrate whether the use of business property is qualified business use. Efile online for free today Example 1. Efile online for free today John Maple is the sole proprietor of a plumbing contracting business. Efile online for free today John employs his brother, Richard, in the business. Efile online for free today As part of Richard's pay, he is allowed to use one of the company automobiles for personal use. Efile online for free today The company includes the value of the personal use of the automobile in Richard's gross income and properly withholds tax on it. Efile online for free today The use of the automobile is pay for the performance of services by a related person, so it is not a qualified business use. Efile online for free today Example 2. Efile online for free today John, in Example 1, allows unrelated employees to use company automobiles for personal purposes. Efile online for free today He does not include the value of the personal use of the company automobiles as part of their compensation and he does not withhold tax on the value of the use of the automobiles. Efile online for free today This use of company automobiles by employees is not a qualified business use. Efile online for free today Example 3. Efile online for free today James Company Inc. Efile online for free today owns several automobiles that its employees use for business purposes. Efile online for free today The employees also are allowed to take the automobiles home at night. Efile online for free today The fair market value of each employee's use of an automobile for any personal purpose, such as commuting to and from work, is reported as income to the employee and James Company withholds tax on it. Efile online for free today This use of company automobiles by employees, even for personal purposes, is a qualified business use for the company. Efile online for free today Investment Use The use of property to produce income in a nonbusiness activity (investment use) is not a qualified business use. Efile online for free today However, you can treat the investment use as business use to figure the depreciation deduction for the property in a given year. Efile online for free today Example 1. Efile online for free today Sarah Bradley uses a home computer 50% of the time to manage her investments. Efile online for free today She also uses the computer 40% of the time in her part-time consumer research business. Efile online for free today Sarah's home computer is listed property because it is not used at a regular business establishment. Efile online for free today She does not use the computer predominantly for qualified business use. Efile online for free today Therefore, she cannot elect a section 179 deduction or claim a special depreciation allowance for the computer. Efile online for free today She must depreciate it using the straight line method over the ADS recovery period. Efile online for free today Her combined business/investment use for determining her depreciation deduction is 90%. Efile online for free today Example 2. Efile online for free today If Sarah uses her computer 30% of the time to manage her investments and 60% of the time in her consumer research business, it is used predominantly for qualified business use. Efile online for free today She can elect a section 179 deduction and, if she does not deduct all the computer's cost, she can claim a special depreciation allowance and depreciate the computer using the 200% declining balance method over the GDS recovery period. Efile online for free today Her combined business/investment use for determining her depreciation deduction is 90%. Efile online for free today Recapture of Excess Depreciation If you used listed property more than 50% in a qualified business use in the year you placed it in service, you must recapture (include in income) excess depreciation in the first year you use it 50% or less. Efile online for free today You also increase the adjusted basis of your property by the same amount. Efile online for free today Excess depreciation is: The depreciation allowable for the property (including any section 179 deduction and special depreciation allowance claimed) for years before the first year you do not use the property predominantly for qualified business use, minus The depreciation that would have been allowable for those years if you had not used the property predominantly for qualified business use in the year you placed it in service. Efile online for free today To determine the amount in (2) above, you must refigure the depreciation using the straight line method and the ADS recovery period. Efile online for free today Example. Efile online for free today In June 2009, Ellen Rye purchased and placed in service a pickup truck that cost $18,000. Efile online for free today She used it only for qualified business use for 2009 through 2012. Efile online for free today Ellen claimed a section 179 deduction of $10,000 based on the purchase of the truck. Efile online for free today She began depreciating it using the 200% DB method over a 5-year GDS recovery period. Efile online for free today The pickup truck's gross vehicle weight was over 6,000 pounds, so it was not subject to the passenger automobile limits discussed later under Do the Passenger Automobile Limits Apply. Efile online for free today During 2013, she used the truck 50% for business and 50% for personal purposes. Efile online for free today She includes $4,018 excess depreciation in her gross income for 2013. Efile online for free today The excess depreciation is determined as follows. Efile online for free today Total section 179 deduction ($10,000) and depreciation claimed ($6,618) for 2009 through 2012. Efile online for free today (Depreciation is from Table A-1. Efile online for free today ) $16,618 Minus: Depreciation allowable (Table A-8):     2009 – 10% of $18,000 $1,800   2010 – 20% of $18,000 3,600   2011 – 20% of $18,000 3,600   2012 – 20% of $18,000 3,600 12,600 Excess depreciation $4,018 If Ellen's use of the truck does not change to 50% for business and 50% for personal purposes until 2015, there will be no excess depreciation. Efile online for free today The total depreciation allowable using Table A-8 through 2015 will be $18,000, which equals the total of the section 179 deduction and depreciation she will have claimed. Efile online for free today Where to figure and report recapture. Efile online for free today   Use Form 4797, Part IV, to figure the recapture amount. Efile online for free today Report the recapture amount as other income on the same form or schedule on which you took the depreciation deduction. Efile online for free today For example, report the recapture amount as other income on Schedule C (Form 1040) if you took the depreciation deduction on Schedule C. Efile online for free today If you took the depreciation deduction on Form 2106, report the recapture amount as other income on Form 1040, line 21. Efile online for free today Lessee's Inclusion Amount If you use leased listed property other than a passenger automobile for business/investment use, you must include an amount in your income in the first year your qualified business-use percentage is 50% or less. Efile online for free today Your qualified business-use percentage is the part of the property's total use that is qualified business use (defined earlier). Efile online for free today For the inclusion amount rules for a leased passenger automobile, see Leasing a Car in chapter 4 of Publication 463. Efile online for free today The inclusion amount is the sum of Amount A and Amount B, described next. Efile online for free today However, see the special rules for the inclusion amount, later, if your lease begins in the last 9 months of your tax year or is for less than one year. Efile online for free today Amount A. Efile online for free today   Amount A is: The fair market value of the property, multiplied by The business/investment use for the first tax year the qualified business-use percentage is 50% or less, multiplied by The applicable percentage from Table A-19 in Appendix A . Efile online for free today   The fair market value of the property is the value on the first day of the lease term. Efile online for free today If the capitalized cost of an item of listed property is specified in the lease agreement, you must treat that amount as the fair market value. Efile online for free today Amount B. Efile online for free today   Amount B is: The fair market value of the property, multiplied by The average of the business/investment use for all tax years the property was leased that precede the first tax year the qualified business-use percentage is 50% or less, multiplied by The applicable percentage from Table A–20 in Appendix A . Efile online for free today Maximum inclusion amount. Efile online for free today   The inclusion amount cannot be more than the sum of the deductible amounts of rent for the tax year in which the lessee must include the amount in gross income. Efile online for free today Inclusion amount worksheet. Efile online for free today   The following worksheet is provided to help you figure the inclusion amount for leased listed property. Efile online for free today Inclusion Amount Worksheet for Leased Listed Property 1. Efile online for free today Fair market value   2. Efile online for free today Business/investment use for first year business use is 50% or less   3. Efile online for free today Multiply line 1 by line 2. Efile online for free today   4. Efile online for free today Rate (%) from Table A-19   5. Efile online for free today Multiply line 3 by line 4. Efile online for free today This is Amount A. Efile online for free today   6. Efile online for free today Fair market value   7. Efile online for free today Average business/investment use for years property leased before the first year business use is 50% or less . Efile online for free today . Efile online for free today . Efile online for free today . Efile online for free today . Efile online for free today . Efile online for free today . Efile online for free today . Efile online for free today . Efile online for free today . Efile online for free today . Efile online for free today . Efile online for free today . Efile online for free today   8. Efile online for free today Multiply line 6 by line 7   9. Efile online for free today Rate (%) from Table A-20   10. Efile online for free today Multiply line 8 by line 9. Efile online for free today This is Amount B. Efile online for free today   11. Efile online for free today Add line 5 and line 10. Efile online for free today This is your inclusion amount. Efile online for free today Enter here and as other income on the form or schedule on which you originally took the deduction (for example, Schedule C or F (Form 1040), Form 1040, Form 1120, etc. Efile online for free today )         Example. Efile online for free today On February 1, 2011, Larry House, a calendar year taxpayer, leased and placed in service a computer with a fair market value of $3,000. Efile online for free today The lease is for a period of 5 years. Efile online for free today Larry does not use the computer at a regular business establishment, so it is listed property. Efile online for free today His business use of the property (all of which is qualified business use) is 80% in 2011, 60% in 2012, and 40% in 2013. Efile online for free today He must add an inclusion amount to gross income for 2013, the first tax year his qualified business-use percentage is 50% or less. Efile online for free today The computer has a 5-year recovery period under both GDS and ADS. Efile online for free today 2013 is the third tax year of the lease, so the applicable percentage from Table A-19 is −19. Efile online for free today 8%. Efile online for free today The applicable percentage from Table A-20 is 22. Efile online for free today 0%. Efile online for free today Larry's deductible rent for the computer for 2013 is $800. Efile online for free today Larry uses the Inclusion amount worksheet. Efile online for free today to figure the amount he must include in income for 2013. Efile online for free today His inclusion amount is $224, which is the sum of −$238 (Amount A) and $462 (Amount B). Efile online for free today Inclusion Amount Worksheet for Leased Listed Property 1. Efile online for free today Fair market value $3,000   2. Efile online for free today Business/investment use for first year business use is 50% or less 40 % 3. Efile online for free today Multiply line 1 by line 2. Efile online for free today 1,200   4. Efile online for free today Rate (%) from Table A-19 −19. Efile online for free today 8 % 5. Efile online for free today Multiply line 3 by line 4. Efile online for free today This is Amount A. Efile online for free today −238   6. Efile online for free today Fair market value 3,000   7. Efile online for free today Average business/investment use for years property leased before the first year business use is 50% or less 70 % 8. Efile online for free today Multiply line 6 by line 7 2,100   9. Efile online for free today Rate (%) from Table A-20 22. Efile online for free today 0 % 10. Efile online for free today Multiply line 8 by line 9. Efile online for free today This is Amount B. Efile online for free today 462   11. Efile online for free today Add line 5 and line 10. Efile online for free today This is your inclusion amount. Efile online for free today Enter here and as other income on the form or schedule on which you originally took the deduction (for example, Schedule C or F (Form 1040), Form 1040, Form 1120, etc. Efile online for free today ) $224           Lease beginning in the last 9 months of your tax year. Efile online for free today    The inclusion amount is subject to a special rule if all the following apply. Efile online for free today The lease term begins within 9 months before the close of your tax year. Efile online for free today You do not use the property predominantly (more than 50%) for qualified business use during that part of the tax year. Efile online for free today The lease term continues into your next tax year. Efile online for free today Under this special rule, add the inclusion amount to income in the next tax year. Efile online for free today Figure the inclusion amount by taking into account the average of the business/investment use for both tax years (line 2 of the Inclusion Amount Worksheet for Leased Listed Property) and the applicable percentage for the tax year the lease term begins. Efile online for free today Skip lines 6 through 9 of the worksheet and enter zero on line 10. Efile online for free today Example 1. Efile online for free today On August 1, 2012, Julie Rule, a calendar year taxpayer, leased and placed in service an item of listed property. Efile online for free today The property is 5-year property with a fair market value of $10,000. Efile online for free today Her property has a recovery period of 5 years under ADS. Efile online for free today The lease is for 5 years. Efile online for free today Her business use of the property was 50% in 2012 and 90% in 2013. Efile online for free today She paid rent of $3,600 for 2012, of which $3,240 is deductible. Efile online for free today She must include $147 in income in 2013. Efile online for free today The $147 is the sum of Amount A and Amount B. Efile online for free today Amount A is $147 ($10,000 × 70% × 2. Efile online for free today 1%), the product of the fair market value, the average business use for 2012 and 2013, and the applicable percentage for year one from Table A-19 . Efile online for free today Amount B is zero. Efile online for free today Lease for less than one year. Efile online for free today   A special rule for the inclusion amount applies if the lease term is less than one year and you do not use the property predominantly (more than 50%) for qualified business use. Efile online for free today The amount included in income is the inclusion amount (figured as described in the preceding discussions) multiplied by a fraction. Efile online for free today The numerator of the fraction is the number of days in the lease term and the denominator is 365 (or 366 for leap years). Efile online for free today   The lease term for listed property other than residential rental or nonresidential real property includes options to renew. Efile online for free today If you have two or more successive leases that are part of the same transaction (or a series of related transactions) for the same or substantially similar property, treat them as one lease. Efile online for free today Example 2. Efile online for free today On October 1, 2012, John Joyce, a calendar year taxpayer, leased and placed in service an item of listed property that is 3-year property. Efile online for free today This property had a fair market value of $15,000 and a recovery period of 5 years under ADS. Efile online for free today The lease term was 6 months (ending on March 31, 2013), during which he used the property 45% in business. Efile online for free today He must include $71 in income in 2013. Efile online for free today The $71 is the sum of Amount A and Amount B. Efile online for free today Amount A is $71 ($15,000 × 45% × 2. Efile online for free today 1% × 183/365), the product of the fair market value, the average business use for both years, and the applicable percentage for year one from Table A-19 , prorated for the length of the lease. Efile online for free today Amount B is zero. Efile online for free today Where to report inclusion amount. Efile online for free today   Report the inclusion amount figured as described in the preceding discussions as other income on the same form or schedule on which you took the deduction for your rental costs. Efile online for free today For example, report the inclusion amount as other income on Schedule C (Form 1040) if you took the deduction on Schedule C. Efile online for free today If you took the deduction for rental costs on Form 2106, report the inclusion amount as other income on Form 1040, line 21. Efile online for free today Do the Passenger Automobile Limits Apply? The depreciation deduction, including the section 179 deduction and special depreciation allowance, you can claim for a passenger automobile (defined earlier) each year is limited. Efile online for free today This section describes the maximum depreciation deduction amounts for 2013 and explains how to deduct, after the recovery period, the unrecovered basis of your property that results from applying the passenger automobile limit. Efile online for free today Exception for leased cars. Efile online for free today   The passenger automobile limits generally do not apply to passenger automobiles leased or held for leasing by anyone regularly engaged in the business of leasing passenger automobiles. Efile online for free today For information on when you are considered regularly engaged in the business of leasing listed property, including passenger automobiles, see Exception for leased property , earlier, under What Is the Business-Use Requirement . Efile online for free today Maximum Depreciation Deduction The passenger automobile limits are the maximum depreciation amounts you can deduct for a passenger automobile. Efile online for free today They are based on the date you placed the automobile in service. Efile online for free today Passenger Automobiles The maximum deduction amounts for most passenger automobiles are shown in the following table. Efile online for free today Maximum Depreciation Deduction for Passenger Automobiles Date       4th & Placed 1st 2nd 3rd Later In Service Year Year Year Years 2013 $11,1601 $5,100 $3,050 $1,875 2012 11,1601 5,100 3,050 1,875 2011 11,0602 4,900 2,950 1,775 2010 11,0602  4,900 2,950 1,775 2009 10,9603 4,800 2,850 1,775 2008 10,9603  4,800 2,850 1,775 2007 3,060 4,900 2,850 1,775 2006 2,960 4,800 2,850 1,775 2005 2,960 4,700 2,850 1,675 2004 10,6104 4,800 2,850 1,675 5/06/2003– 12/31/2003 10,7105 4,900 2,950 1,775 1/01/2003– 5/05/2003 7,6606 4,900 2,950 1,775 1If you elected not to claim any special depreciation allowance or the vehicle is not qualified property, the maximum deduction is $3,160. Efile online for free today 2If you elected not to claim any special depreciation allowance or the vehicle is not qualified property, the maximum deduction is $3,060. Efile online for free today 3If you elected not to claim any special depreciation allowance for the vehicle or the vehicle is not qualified property, the maximum deduction is $2,960. Efile online for free today 4If you elected not to claim any special depreciation allowance for the vehicle, the vehicle is not qualified property, or the vehicle is qualified Liberty Zone property, the maximum deduction is $2,960. Efile online for free today 5If you acquired the vehicle before 5/06/03, the maximum deduction is $7,660. Efile online for free today If you elected not to claim any special depreciation allowance for the vehicle, the vehicle is not qualified property, or the vehicle is qualified Liberty Zone property, the maximum deduction is $3,060. Efile online for free today 6If you elected not to claim any special depreciation allowance for the vehicle, the vehicle is not qualified property, or the vehicle is qualified Liberty Zone property, the maximum deduction is $3,060. Efile online for free today If your business/investment use of the automobile is less than 100%, you must reduce the maximum deduction amount by multiplying the maximum amount by the percentage of business/investment use determined on an annual basis during the tax year. Efile online for free today If you have a short tax year, you must reduce the maximum deduction amount by multiplying the maximum amount by a fraction. Efile online for free today The numerator of the fraction is the number of months and partial months in the short tax year and the denominator is 12. Efile online for free today Example. Efile online for free today On April 15, 2013, Virginia Hart bought and placed in service a new car for $14,500. Efile online for free today She used the car only in her business. Efile online for free today She files her tax return based on the calendar year. Efile online for free today She does not elect a section 179 deduction and elected not to claim any special depreciation allowance for the car. Efile online for free today Under MACRS, a car is 5-year property. Efile online for free today Since she placed her car in service on April 15 and used it only for business, she uses the percentages in Table A-1 to figure her MACRS depreciation on the car. Efile online for free today Virginia multiplies the $14,500 unadjusted basis of her car by 0. Efile online for free today 20 to get her MACRS depreciation of $2,900 for 2013. Efile online for free today This $2,900 is below the maximum depreciation deduction of $3,160 for passenger automobiles placed in service in 2013. Efile online for free today She can deduct the full $2,900. Efile online for free today Electric Vehicles The maximum depreciation deductions for passenger automobiles that are produced to run primarily on electricity are higher than those for other automobiles. Efile online for free today The maximum deduction amounts for electric vehicles placed in service after August 5, 1997, and before January 1, 2007, are shown in the following table. Efile online for free today Owners of electric vehicles placed in service after December 31, 2006, should use the table of maximum deduction amounts later for electric vehicles classified as passenger automobiles or use the table of maximum deduction amounts for trucks and vans later, for electric vehicles classified as trucks and vans. Efile online for free today Maximum Depreciation Deduction For Electric Vehicles Date       4th & Placed 1st 2nd 3rd Later In Service Year Year Year Years 2006 $8,980 $14,400 $8,650 $5,225 2005 8,880 14,200 8,450 5,125 2004 31,8301 14,300 8,550 5,125 5/06/2003– 12/31/2003 32,0302 14,600 8,750 5,225 1/01/2003– 5/05/2003 22,8803 14,600 8,750 5,225 1If you elected not to claim any special depreciation allowance for the vehicle or the vehicle is not qualified property, or the vehicle is qualified Liberty Zone property, the maximum deduction is $8,880. Efile online for free today 2If you acquired the vehicle before 5/06/03, the maximum deduction is $22,880. Efile online for free today If you elected not to claim any special depreciation allowance for the vehicle, the vehicle is not qualified property, or the vehicle is qualified Liberty Zone property, the maximum deduction is $9,080. Efile online for free today 3 If you elected not to claim any special depreciation allowance for the vehicle, the vehicle is not qualified property, or the vehicle is qualified Liberty Zone property, the maximum deduction is $9,080. Efile online for free today Trucks and Vans The maximum depreciation deductions for trucks and vans placed in service after 2002 are higher than those for other passenger automobiles. Efile online for free today The maximum deduction amounts for trucks and vans are shown in the following table. Efile online for free today Maximum Depreciation Deduction For Trucks and Vans Date       4th & Placed 1st 2nd 3rd Later In Service Year Year Year Years 2013 $11,3601 $5,400 $3,250 $1,975 2012 11,3601 5,300 3,150 1,875 2011 11,2602 5,200 3,150 1,875 2010 11,1603 5,100 3,050 1,875 2009 11,0604 4,900 2,950 1,775 2008 11,1605 5,100 3,050 1,875 2007 3,260 5,200 3,050 1,875 2006 3,260 5,200 3,150 1,875 2005 3,260 5,200 3,150 1,875 2004 10,9106 5,300 3,150 1,875 5/06/2003– 12/31/2003 11,0107 5,400 3,250 1,975 1/01/2003– 5/05/2003 7,9608 5,400 3,250 1,975 1 If you elected not to claim any special depreciation allowance or the vehicle is not qualified property, the maximum deduction is $3,360. Efile online for free today 2 If you elected not to claim any special depreciation allowance or the vehicle is not qualified property, the maximum deduction is $3,260. Efile online for free today 3 If you elected not to claim any special depreciation allowance or the vehicle is not qualified property, the maximum deduction is $3,160. Efile online for free today 4 If you elect not to claim any special depreciation allowance for the vehicle or the vehicle is not qualified property, the maximum deduction is $3,060. Efile online for free today 5If you elected not to claim any special depreciation allowance for the vehicle or the vehicle is not qualified property, the maximum deduction is $3,160. Efile online for free today 6If you elected not to claim any special depreciation allowance for the vehicle, the vehicle is not qualified property, or the vehicle is qualified Liberty Zone property, or the maximum deduction is $3,260. Efile online for free today 7 If you acquired the vehicle before 5/06/03, the maximum deduction is $7,960. Efile online for free today If you elected not to claim any special depreciation allowance for the vehicle, the vehicle is not qualified property, or the vehicle is qualified Liberty Zone property, the maximum deduction is $3,360. Efile online for free today 8 If you elected not to claim any special depreciation allowance for the vehicle, the vehicle is not qualified property, or the vehicle is qualified Liberty Zone property, the maximum deduction is $3,360. Efile online for free today Depreciation Worksheet for Passenger Automobiles You can use the following worksheet to figure your depreciation deduction using the percentage tables. Efile online for free today Then use the information from this worksheet to prepare Form 4562. Efile online for free today Depreciation Worksheet for Passenger Automobiles   Part I   1. Efile online for free today MACRS system (GDS or ADS)     2. Efile online for free today Property class     3. Efile online for free today Date placed in service     4. Efile online for free today Recovery period     5. Efile online for free today Method and convention     6. Efile online for free today Depreciation rate (from tables)     7. Efile online for free today Maximum depreciation deduction for this year from the appropriate table       8. Efile online for free today Business/investment-use percentage       9. Efile online for free today Multiply line 7 by line 8. Efile online for free today This is your adjusted maximum depreciation deduction       10. Efile online for free today Section 179 deduction claimed this year (not more than line 9). Efile online for free today Enter -0- if this is not the year you placed the car in service. Efile online for free today         Note. Efile online for free today  1) If line 10 is equal to line 9, stop here. Efile online for free today Your combined section 179 and depreciation deduction (including your special depreciation allowance) is limited to the amount on line 9. Efile online for free today  2) If line 10 is less than line 9, complete Part II. Efile online for free today   Part II   11. Efile online for free today Subtract line 10 from line 9. Efile online for free today This is the limit on the amount you can deduct for depreciation (including any special depreciation allowance )       12. Efile online for free today Cost or other basis (reduced by any alternative motor vehicle credit 1or credit for electric vehicles 2)       13. Efile online for free today Multiply line 12 by line 8. Efile online for free today This is your business/investment cost       14. Efile online for free today Section 179 deduction claimed in the year you placed the car in service       15. Efile online for free today Subtract line 14 from line 13. Efile online for free today This is your tentative basis for depreciation       16. Efile online for free today Multiply line 15 by . Efile online for free today 50 if the 50% special depreciation allowance applies. Efile online for free today This is your special depreciation allowance. Efile online for free today Enter -0- if this is not the year you placed the car in service, the car is not qualified property, or you elected not to claim a special depreciation allowance       Note 1) If line 16 is equal to line 11, stop here. Efile online for free today Your depreciation deduction (including your special depreciation allowance) is limited to the amount on line 11. Efile online for free today  2) If line 16 is less than line 11, complete Part III. Efile online for free today   Part III   17. Efile online for free today Subtract line 16 from 11. Efile online for free today This is the limit on the amount you can deduct for MACRS depreciation       18. Efile online for free today Subtract line 16 from line 15. Efile online for free today This is your basis for depreciation. Efile online for free today       19. Efile online for free today Multiply line 18 by line 6. Efile online for free today This is your tentative MACRS depreciation deduction. Efile online for free today       20. Efile online for free today Enter the lesser of line 17 or line 19. Efile online for free today This is your MACRS depreciation deduction. Efile online for free today     1 When figuring the amount to enter on line 12, do not reduce your cost or other basis by any section 179 deduction you claimed for your car. Efile online for free today 2 Reduce the basis by the lesser of $4,000 or 10% of the cost of the vehicle even if the credit is less than that amount. Efile online for free today             Deductions After the Recovery Period If the depreciation deductions for your automobile are reduced under the passenger automobile limits, you will have unrecovered basis in your automobile at the end of the recovery period. Efile online for free today If you continue to use the automobile for business, you can deduct that unrecovered basis after the recovery period ends. Efile online for free today You can claim a depreciation deduction in each succeeding tax year until you recover your full basis in the car. Efile online for free today The maximum amount you can deduct each year is determined by the date you placed the car in service and your business/investment-use percentage. Efile online for free today See Maximum Depreciation Deduction , earlier. Efile online for free today Unrecovered basis is the cost or other basis of the passenger automobile reduced by any clean-fuel vehicle deduction, electric vehicle credit, depreciation, and section 179 deductions that would have been allowable if you had used the car 100% for business and investment use and the passenger automobile limits had not applied. Efile online for free today You cannot claim a depreciation deduction for listed property other than passenger automobiles after the recovery period ends. Efile online for free today There is no unrecovered basis at the end of the recovery period because you are considered to have used this property 100% for business and investment purposes during all of the recovery period. Efile online for free today Example. Efile online for free today In May 2007, you bought and placed in service a car costing $31,500. Efile online for free today The car was 5-year property under GDS (MACRS). Efile online for free today You did not elect a section 179 deduction and elected not to claim any special depreciation allowance for the car. Efile online for free today You used the car exclusively for business during the recovery period (2007 through 2012). Efile online for free today You figured your depreciation as shown below. Efile online for free today Year Percentage Amount Limit   Allowed 2007 20. Efile online for free today 0% $6,300 $2,960   $2,960 2008 32. Efile online for free today 0 10,080 4,800   4,800 2009 19. Efile online for free today 2 6,048 2,850   2,850 2010 11. Efile online for free today 52 3,629 1,675   1,675 2011 11. Efile online for free today 52 3,629 1,675   1,675 2012 5. Efile online for free today 76 1,814 1,675   1,675 Total   $15,635 At the end of 2012, you had an unrecovered basis of $15,865 ($31,500 − $15,635). Efile online for free today If in 2013 and later years you continue to use the car 100% for business, you can deduct each year the lesser of $1,675 or your remaining unrecovered basis. Efile online for free today If your business use of the car had been less than 100% during any year, your depreciation deduction would have been less than the maximum amount allowable for that year. Efile online for free today However, in figuring your unrecovered basis in the car, you would still reduce your basis by the maximum amount allowable as if the business use had been 100%. Efile online for free today For example, if you had used your car 60% for business instead of 100%, your allowable depreciation deductions would have been $9,519 ($15,865 × 60%), but you still would have to reduce your basis by $15,865 to determine your unrecovered basis. Efile online for free today Deductions For Passenger Automobiles Acquired in a Trade-in If you acquire a passenger automobile in a trade-in, depreciate the carryover basis separately as if the trade-in did not occur. Efile online for free today Depreciate the part of the new automobile's basis that exceeds its carryover basis (excess basis) as if it were newly placed in service property. Efile online for free today This excess basis is the additional cash paid for the new automobile in the trade-in. Efile online for free today The depreciation figured for the two components of the basis (carryover basis and excess basis) is subject to a single passenger automobile limit. Efile online for free today Special rules apply in determining the passenger automobile limits. Efile online for free today These rules and examples are discussed in section 1. Efile online for free today 168(i)-6(d)(3) of the regulations. Efile online for free today Instead of figuring depreciation for the carryover basis and the excess basis separately, you can elect to treat the old automobile as disposed of and both of the basis components for the new automobile as if placed in service at the time of the trade-in. Efile online for free today For more information, including how to make this election, see Election out under Property Acquired in a Like-kind Exchange or Involuntary Conversion in chapter 4 and sections 1. Efile online for free today 168(i)-6(i) and 1. Efile online for free today 168(i)-6(j) of the regulations. Efile online for free today What Records Must Be Kept? You cannot take any depreciation or section 179 deduction for the use of listed property unless you can prove your business/investment use with adequate records or with sufficient evidence to support your own statements. Efile online for free today For listed property, you must keep records for as long as any recapture can still occur. Efile online for free today Recapture can occur in any tax year of the recovery period. Efile online for free today Adequate Records To meet the adequate records requirement, you must maintain an account book, diary, log, statement of expense, trip sheet, or similar record or other documentary evidence that, together with the receipt, is sufficient to establish each element of an expenditure or use. Efile online for free today You do not have to record information in an account book, diary, or similar record if the information is already shown on the receipt. Efile online for free today However, your records should back up your receipts in an orderly manner. Efile online for free today Elements of expenditure or use. Efile online for free today   Your records or other documentary evidence must support all the following. Efile online for free today The amount of each separate expenditure, such as the cost of acquiring the item, maintenance and repair costs, capital improvement costs, lease payments, and any other expenses. Efile online for free today The amount of each business and investment use (based on an appropriate measure, such as mileage for vehicles and time for other listed property), and the total use of the property for the tax year. Efile online for free today The date of the expenditure or use. Efile online for free today The business or investment purpose for the expenditure or use. Efile online for free today   Written documents of your expenditure or use are generally better evidence than oral statements alone. Efile online for free today You do not have to keep a daily log. Efile online for free today However, some type of record containing the elements of an expenditure or the business or investment use of listed property made at or near the time of the expenditure or use and backed up by other documents is preferable to a statement you prepare later. Efile online for free today Timeliness. Efile online for free today   You must record the elements of an expenditure or use at the time you have full knowledge of the elements. Efile online for free today An expense account statement made from an account book, diary, or similar record prepared or maintained at or near the time of the expenditure or use generally is considered a timely record if, in the regular course of business: The statement is given by an employee to the employer, or The statement is given by an independent contractor to the client or customer. Efile online for free today   For example, a log maintained on a weekly basis, that accounts for use during the week, will be considered a record made at or near the time of use. Efile online for free today Business purpose supported. Efile online for free today   Generally, an adequate record of business purpose must be in the form of a written statement. Efile online for free today However, the amount of detail necessary to establish a business purpose depends on the facts and circumstances of each case. Efile online for free today A written explanation of the business purpose will not be required if the purpose can be determined from the surrounding facts and circumstances. Efile online for free today For example, a salesperson visiting customers on an established sales route will not normally need a written explanation of the business purpose of his or her travel. Efile online for free today Business use supported. Efile online for free today   An adequate record contains enough information on each element of every business or investment use. Efile online for free today The amount of detail required to support the use depends on the facts and circumstances. Efile online for free today For example, a taxpayer who uses a truck for both business and personal purposes and whose only business use of the truck is to make customer deliveries on an established route can satisfy the requirement by recording the length of the route, including the total number of miles driven during the tax year and the date of each trip at or near the time of the trips. Efile online for free today   Although you generally must prepare an adequate written record, you can prepare a record of the business use of listed property in a computer memory device that uses a logging program. Efile online for free today Separate or combined expenditures or uses. Efile online for free today   Each use by you normally is considered a separate use. Efile online for free today However, you can combine repeated uses as a single item. Efile online for free today   Record each expenditure as a separate item. Efile online for free today Do not combine it with other expenditures. Efile online for free today If you choose, however, you can combine amounts you spent for the use of listed property during a tax year, such as for gasoline or automobile repairs. Efile online for free today If you combine these expenses, you do not need to support the business purpose of each expense. Efile online for free today Instead, you can divide the expenses based on the total business use of the listed property. Efile online for free today   You can account for uses that can be considered part of a single use, such as a round trip or uninterrupted business use, by a single record. Efile online for free today For example, you can account for the use of a truck to make deliveries at several locations that begin and end at the business premises and can include a stop at the business in between deliveries by a single record of miles driven. Efile online for free today You can account for the use of a passenger automobile by a salesperson for a business trip away from home over a period of time by a single record of miles traveled. Efile online for free today Minimal personal use (such as a stop for lunch between two business stops) is not an interruption of business use. Efile online for free today Confidential information. Efile online for free today   If any of the information on the elements of an expenditure or use is confidential, you do not need to include it in the account book or similar record if you record it at or near the time of the expenditure or use. Efile online for free today You must keep it elsewhere and make it available as support to the IRS director for your area on request. Efile online for free today Substantial compliance. Efile online for free today   If you have not fully supported a particular element of an expenditure or use, but have complied with the adequate records requirement for the expenditure or use to the satisfaction of the IRS director for your area, you can establish this element by any evidence the IRS director for your area deems adequate. Efile online for free today   If you fail to establish to the satisfaction of the IRS director for your area that you have substantially complied with the adequate records requirement for an element of an expenditure or use, you must establish the element as follows. Efile online for free today By your own oral or written statement containing detailed information as to the element. Efile online for free today By other evidence sufficient to establish the element. Efile online for free today   If the element is the cost or amount, time, place, or date of an expenditure or use, its supporting evidence must be direct evidence, such as oral testimony by witnesses or a written statement setting forth detailed information about the element or the documentary evidence. Efile online for free today If the element is the business purpose of an expenditure, its supporting evidence can be circumstantial evidence. Efile online for free today Sampling. Efile online for free today   You can maintain an adequate record for part of a tax year and use that record to support your business and investment use of listed property for the entire tax year if it can be shown by other evidence that the periods for which you maintain an adequate record are representative of the use throughout the year. Efile online for free today Example 1. Efile online for free today Denise Williams, a sole proprietor and calendar year taxpayer, operates an interior decorating business out of her home. Efile online for free today She uses her automobile for local business visits to the homes or offices of clients, for meetings with suppliers and subcontractors, and to pick up and deliver items to clients. Efile online for free today There is no other business use of the automobile, but she and family members also use it for personal purposes. Efile online for free today She maintains adequate records for the first 3 months of the year showing that 75% of the automobile use was for business. Efile online for free today Subcontractor invoices and paid bills show that her business continued at approximately the same rate for the rest of the year. Efile online for free today If there is no change in circumstances, such as the purchase of a second car for exclusive use in her business, the determination that her combined business/investment use of the automobile for the tax year is 75% rests on sufficient supporting evidence. Efile online for free today Example 2. Efile online for free today Assume the same facts as in Example 1, except that Denise maintains adequate records during the first week of every month showing that 75% of her use of the automobile is for business. Efile online for free today Her business invoices show that her business continued at the same rate during the later weeks of each month so that her weekly records are representative of the automobile's business use throughout the month. Efile online for free today The determination that her business/investment use of the automobile for the tax year is 75% rests on sufficient supporting evidence. Efile online for free today Example 3. Efile online for free today Bill Baker, a sole proprietor and calendar year taxpayer, is a salesman in a large metropolitan area for a company that manufactures household products. Efile online for free today For the first 3 weeks of each month, he occasionally uses his own automobile for business travel within the metropolitan area. Efile online for free today During these weeks, his business use of the automobile does not follow a consistent pattern. Efile online for free today During the fourth week of each month, he delivers all business orders taken during the previous month. Efile online for free today The business use of his automobile, as supported by adequate records, is 70% of its total use during that fourth week. Efile online for free today The determination based on the record maintained during the fourth week of the month that his business/investment use of the automobile for the tax year is 70% does not rest on sufficient supporting evidence because his use during that week is not representative of use during other periods. Efile online for free today Loss of records. Efile online for free today   When you establish that failure to produce adequate records is due to loss of the records through circumstances beyond your control, such as through fire, flood, earthquake, or other casualty, you have the right to support a deduction by reasonable reconstruction of your expenditures and use. Efile online for free today How Is Listed Property Information Reported? You must provide the information about your listed property requested in Part V of Form 4562, Section A, if you claim either of the following deductions. Efile online for free today Any deduction for a vehicle. Efile online for free today A depreciation deduction for any other listed property. Efile online for free today If you claim any deduction for a vehicle, you also must provide the information requested in Section B. Efile online for free today If you provide the vehicle for your employee's use, the employee must give you this information. Efile online for free today If you provide any vehicle for use by an employee, you must first answer the questions in Section C to see if you meet an exception to completing Section B for that vehicle. Efile online for free today Vehicles used by your employees. Efile online for free today   You do not have to complete Section B, Part V, for vehicles used by your employees who are not more-than-5% owners or related persons if you meet at least one of the following requirements. Efile online for free today You maintain a written policy statement that prohibits one of the following uses of the vehicles. Efile online for free today All personal use including commuting. Efile online for free today Personal use, other than commuting, by employees who are not officers, directors, or 1%-or-more owners. Efile online for free today You treat all use of the vehicles by your employees as personal use. Efile online for free today You provide more than five vehicles for use by your employees, and you keep in your records the information on their use given to you by the employees. Efile online for free today For demonstrator automobiles provided to full-time salespersons, you maintain a written policy statement that limits the total mileage outside the salesperson's normal working hours and prohibits use of the automobile by anyone else, for vacation trips, or to store personal possessions. Efile online for free today Exceptions. Efile online for free today   If you file Form 2106, 2106-EZ, or Schedule C-EZ (Form 1040), and you are not required to file Form 4562, report information about listed property on that form and not on Form 4562. Efile online for free today Also, if you file Schedule C (Form 1040) and are claiming the standard mileage rate or actual vehicle expenses (except depreciation) and you are not required to file Form 4562 for any other reason, report vehicle information in Part IV of Schedule C and not on Form 4562. Efile online for free today Prev  Up  Next   Home   More Online Publications
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Historical Highlights of the IRS

1862 - President Lincoln signed into law a revenue-raising measure to help pay for Civil War expenses. The measure created a Commissioner of Internal Revenue and the nation's first income tax. It levied a 3 percent tax on incomes between $600 and $10,000 and a 5 percent tax on incomes of more than $10,000.

1867 - Heeding public opposition to the income tax, Congress cut the tax rate. From 1868 until 1913, 90 percent of all revenue came from taxes on liquor, beer, wine and tobacco.

1872 - Income tax repealed.

1894 - The Wilson Tariff Act revived the income tax and an income tax division within the Bureau of Internal Revenue was created.

1895 - Supreme Court ruled the new income tax unconstitutional on the grounds that it was a direct tax and not apportioned among the states on the basis of population. The income tax division was disbanded.

1909 - President Taft recommended Congress propose a constitutional amendment that would give the government the power to tax incomes without apportioning the burden among the states in line with population. Congress also levied a 1 percent tax on net corporate incomes of more than $5,000.

1913 - As the threat of war loomed, Wyoming became the 36th and last state needed to ratify the 16th Amendment. The amendment stated, "Congress shall have the power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several states, and without regard to any census or enumeration." Later, Congress adopted a 1 percent tax on net personal income of more than $3,000 with a surtax of 6 percent on incomes of more than $500,000. It also repealed the 1909 corporate income tax. The first Form 1040 was introduced.

1918 - The Revenue Act of 1918 raised even greater sums for the World War I effort. It codified all existing tax laws and imposed a progressive income-tax rate structure of up to 77 percent.

1919 - The states ratified the 18th Amendment, barring the manufacture, sale or transport of intoxicating beverages. Congress passed the Volstead Act, which gave the Commissioner of Internal Revenue the primary responsibility for enforcement of Prohibition. Eleven years later, the Department of Justice assumed primary prohibition enforcement duties.

1931 - The IRS Intelligence Unit used an undercover agent to gather evidence against gangster Al Capone. Capone was convicted of tax evasion and sentenced to 11 years.

1933 - Prohibition repealed. IRS again assumed responsibility for alcohol taxation the following year and for administering the National Firearms Act. Later, tobacco tax enforcement was added.

1942 - The Revenue Act of 1942, hailed by President Roosevelt as "the greatest tax bill in American history," passed Congress. It increased taxes and the number of Americans subject to the income tax. It also created deductions for medical and investment expenses.

1943 - Congress passed the Current Tax Payment Act, which required employers to withhold taxes from employees' wages and remit them quarterly.

1944 - Congress passed the Individual Income Tax Act, which created the standard deductions on Form 1040.

1952 - President Truman proposed his Reorganization Plan No. 1, which replaced the patronage system at the IRS with a career civil service system. It also decentralized service to taxpayers and sought to restore public confidence in the agency.

1953 - President Eisenhower endorsed Truman's reorganization plan and changed the name of the agency from the Bureau of Internal Revenue to the Internal Revenue Service.

1954 - The filing deadline for individual tax returns changed from March 15 to April 15.

1961 - The Computer Age began at IRS with the dedication of the National Computer Center at Martinsburg, W.Va.

1965 - IRS instituted its first toll-free telephone site.

1972 - The Alcohol, Tobacco and Firearms Division separated from the IRS to become the independent Bureau of Alcohol, Tobacco and Firearms.

1974 - Congress passed the Employee Retirement and Income Security Act, which gave regulatory responsibilities for employee benefit plans to the IRS.

1986 - Limited electronic filing began. President Reagan signed the Tax Reform Act, the most significant piece of tax legislation in 30 years. It contained 300 provisions and took three years to implement. The Act codified the federal tax laws for the third time since the Revenue Act of 1918.

1992 - Taxpayers who owed money were allowed to file returns electronically.

1998 - Congress passed the IRS Restructuring and Reform Act, which expanded taxpayer rights and called for reorganizing the agency into four operating divisions aligned according to taxpayer needs.

2000 - IRS enacted reforms, ending its geographic-based structure and instituting four major operating divisions: Wage and Investment, Small Business/Self-Employed, Large and Mid-Size Business and Tax Exempt and Government Entities. It was the most sweeping change at the IRS since the 1953 reorganization.

2001 - IRS administered a mid-year tax refund program to provide advance payments of a tax rate reduction.

2003 - IRS administered another mid-year refund program, this time providing an advance payment of an increase in the Child Tax Credit. Electronic filing reached a new high - 52.9 million tax returns, more than 40 percent of all individual returns.

Page Last Reviewed or Updated: 12-Feb-2014

The Efile Online For Free Today

Efile online for free today Publication 80 - Introductory Material Table of Contents Future Developments What's New Reminders Calendar Future Developments For the latest information about developments related to Publication 80 (Circular SS), such as legislation enacted after it was published, go to www. Efile online for free today irs. Efile online for free today gov/pub80. Efile online for free today What's New Social security and Medicare tax for 2014. Efile online for free today  The social security tax rate is 6. Efile online for free today 2% each for the employee and employer, unchanged from 2013. Efile online for free today The social security wage base limit is $117,000. Efile online for free today The Medicare tax rate is 1. Efile online for free today 45% each for the employee and employer, unchanged from 2013. Efile online for free today There is no wage base limit for Medicare tax. Efile online for free today Social security and Medicare taxes apply to the wages of household workers you pay $1,900 or more in cash or an equivalent form of compensation. Efile online for free today Social security and Medicare taxes apply to election workers who are paid $1,600 or more in cash or an equivalent form of compensation. Efile online for free today Change of responsible party. Efile online for free today . Efile online for free today  Beginning January 1, 2014, any entity with an employer identification number (EIN) must file Form 8822-B, Change of Address or Responsible Party—Business, to report the latest change to its responsible party. Efile online for free today Form 8822-B must be filed within 60 days of the change. Efile online for free today If the change in the identity of your responsible party occurred before 2014, and you have not previously notified the IRS of the change, file Form 8822-B before March 1, 2014, reporting only the most recent change. Efile online for free today For a definition of “responsible party”, see the Form 8822-B instructions. Efile online for free today Same-sex marriage. Efile online for free today  For federal tax purposes, individuals of the same sex are considered married if they were lawfully married in a state (or foreign country) whose laws authorize the marriage of two individuals of the same sex, even if the state (or foreign country) in which they now live does not recognize same-sex marriage. Efile online for free today For more information, see Revenue Ruling 2013-17, 2013-38 I. Efile online for free today R. Efile online for free today B. Efile online for free today 201, available at www. Efile online for free today irs. Efile online for free today gov/irb/2013-38_IRB/ar07. Efile online for free today html. Efile online for free today Notice 2013-61 provides special administrative procedures for employers to make claims for refund or adjustments of overpayments of social security and Medicare taxes with respect to certain same-sex spouse benefits before expiration of the period of limitations. Efile online for free today Notice 2013-61, 2013-44 I. Efile online for free today R. Efile online for free today B. Efile online for free today 432, is available at www. Efile online for free today irs. Efile online for free today gov/irb/2013-44_IRB/ar10. Efile online for free today html. Efile online for free today Reminders Additional Medicare Tax withholding. Efile online for free today  In addition to withholding Medicare tax at 1. Efile online for free today 45%, you must withhold a 0. Efile online for free today 9% Additional Medicare Tax from wages you pay to an employee in excess of $200,000 in a calendar year. Efile online for free today You are required to begin withholding Additional Medicare Tax in the pay period in which you pay wages in excess of $200,000 to an employee and continue to withhold it each pay period until the end of the calendar year. Efile online for free today Additional Medicare Tax is only imposed on the employee. Efile online for free today There is no employer share of Additional Medicare Tax. Efile online for free today All wages that are subject to Medicare tax are subject to Additional Medicare Tax withholding if paid in excess of the $200,000 withholding threshold. Efile online for free today For more information on what wages are subject to Medicare tax, see the chart, Special Rules for Various Types of Employment and Payments , in section 12. Efile online for free today For more information on Additional Medicare Tax, visit IRS. Efile online for free today gov and enter “Additional Medicare Tax” in the search box. Efile online for free today Work opportunity tax credit for qualified tax-exempt organizations hiring qualified veterans. Efile online for free today  The work opportunity tax credit is available for eligible unemployed veterans who begin work on or after November 22, 2011, and before January 1, 2014. Efile online for free today Qualified tax-exempt organizations that hire eligible unemployed veterans can claim the work opportunity tax credit against their payroll tax liability using Form 5884-C, Work Opportunity Credit for Qualified Tax-Exempt Organizations Hiring Qualified Veterans. Efile online for free today For more information, visit IRS. Efile online for free today gov and enter “work opportunity tax credit” in the search box. Efile online for free today Outsourcing payroll duties. Efile online for free today  Employers are responsible to ensure that tax returns are filed and deposits and payments are made, even if the employer contracts with a third party to perform these acts. Efile online for free today The employer remains responsible if the third party fails to perform any required action. Efile online for free today If you choose to outsource any of your payroll and related tax duties (that is, withholding, reporting, and paying over social security, Medicare, FUTA, and income taxes) to a third-party payer such as a payroll service provider or reporting agent, visit IRS. Efile online for free today gov and enter “outsourcing payroll duties” in the search box for helpful information on this topic. Efile online for free today Residents of the Philippines working in the Commonwealth of the Northern Mariana Islands (CNMI). Efile online for free today  The IRS will not assert that an employer has understated liability for social security and Medicare taxes because they failed to treat services performed before January 1, 2015, in the CNMI by a resident of the Philippines as employment as defined under Internal Revenue Code section 3121(b). Efile online for free today For more information, see Announcement 2012-43, 2012-51 I. Efile online for free today R. Efile online for free today B. Efile online for free today 723, available at www. Efile online for free today irs. Efile online for free today gov/irb/2012-51_IRB/ar15. Efile online for free today html. Efile online for free today CNMI government employees now subject to social security and Medicare taxes. Efile online for free today  Beginning in the fourth calendar quarter of 2012, CNMI government employees are subject to social security and Medicare taxes. Efile online for free today COBRA premium assistance credit. Efile online for free today  The credit for COBRA premium assistance payments applies to premiums paid for employees involuntarily terminated between September 1, 2008 and May 31, 2010, and to premiums paid for up to 15 months. Efile online for free today See COBRA premium assistance credit in Publication 15 (Circular E), Employer's Tax Guide. Efile online for free today You can get Publication 15 (Circular E) at IRS. Efile online for free today gov. Efile online for free today You must receive written notice from the IRS to file Form 944. Efile online for free today  If you have been filing Forms 941-SS and believe your employment taxes for the calendar year will be $1,000 or less, and you would like to file Form 944, Employer's ANNUAL Federal Tax Return, instead of Forms 941-SS, you must contact the IRS to request to file Form 944. Efile online for free today You must receive written notice from the IRS to file Form 944 instead of Forms 941-SS before you may file this form. Efile online for free today For more information on requesting to file Form 944 visit IRS. Efile online for free today gov and enter “file employment taxes annually” in the search box. Efile online for free today Federal employers in the CNMI. Efile online for free today  The U. Efile online for free today S. Efile online for free today Treasury Department and the CNMI Division of Revenue and Taxation entered into an agreement under 5 USC 5517 in December 2006. Efile online for free today Under this agreement, all federal employers (including the Department of Defense) are required to withhold CNMI income taxes (rather than federal income taxes) and deposit the CNMI taxes with the CNMI Treasury for employees who are subject to CNMI taxes and whose regular place of federal employment is in the CNMI. Efile online for free today Federal employers are also required to file quarterly and annual reports with the CNMI Division of Revenue and Taxation. Efile online for free today For questions, contact the CNMI Division of Revenue and Taxation. Efile online for free today Change of address. Efile online for free today  Use Form 8822-B to notify the IRS of an address change. Efile online for free today Do not mail Form 8822-B with your employment tax return. Efile online for free today Federal tax deposits must be made by electronic funds transfer. Efile online for free today  You must use electronic funds transfer to make all federal tax deposits. Efile online for free today Generally, electronic fund transfers are made using the Electronic Federal Tax Payment System (EFTPS). Efile online for free today If you do not want to use EFTPS, you can arrange for your tax professional, financial institution, payroll service, or other trusted third party to make electronic deposits on your behalf. Efile online for free today Also, you may arrange for your financial institution to initiate a same-day wire payment on your behalf. Efile online for free today EFTPS is a free service provided by the Department of Treasury. Efile online for free today Services provided by your tax professional, financial institution, payroll service, or other third party may have a fee. Efile online for free today For more information on making federal tax deposits, see How To Deposit in section 8. Efile online for free today For more information about EFTPS or to enroll in EFTPS, visit the EFTPS website at www. Efile online for free today eftps. Efile online for free today gov or call 1-800-555-4477 (U. Efile online for free today S. Efile online for free today Virgin Islands only) or 303-967-5916 (toll call) or 1-800-733-4829 (TDD). Efile online for free today Additional information about EFTPS is also available in Publication 966, Electronic Federal Tax Payment System: A Guide To Getting Started. Efile online for free today Electronic filing and payment. Efile online for free today  Using electronic options can make filing a return and paying your federal tax easier. Efile online for free today Use the Electronic Federal Tax Payment System (EFTPS) to make deposits or pay in full, whether you rely on a tax professional or prepare your own taxes. Efile online for free today You can use IRS e-file to file certain returns. Efile online for free today If there is a balance due on the return, you can e-file and e-pay in a single step by authorizing an electronic funds withdrawal (EFW) from your bank account while e-filing. Efile online for free today Do not use EFW to pay taxes that are required to be deposited. Efile online for free today Visit the IRS website at www. Efile online for free today irs. Efile online for free today gov/efile for more information on filing electronically. Efile online for free today For more information on paying your taxes using EFW, visit the IRS website at www. Efile online for free today irs. Efile online for free today gov/e-pay. Efile online for free today A fee may be charged to file electronically. Efile online for free today For EFTPS, visit www. Efile online for free today eftps. Efile online for free today gov or call EFTPS Customer Service at 1-800-555-4477 (U. Efile online for free today S. Efile online for free today Virgin Islands only) or 303-967-5916 (toll call). Efile online for free today For electronic filing of Forms W-2AS, W-2CM, W-2GU, W-2VI, Wage and Tax Statements; W-3SS, Transmittal of Wage and Tax Statements; and W-2c, Corrected Wage and Tax Statement, visit www. Efile online for free today socialsecurity. Efile online for free today gov/employer. Efile online for free today If you are filing your tax return or paying your federal taxes electronically, a valid EIN is required. Efile online for free today If a valid EIN is not provided, the return or payment will not be processed. Efile online for free today This may result in penalties and delays in processing your return or payment. Efile online for free today Electronic option for filing Forms W-2AS, W-2CM, W-2GU, or W-2VI. Efile online for free today  Employers in American Samoa, the CNMI, Guam, and the U. Efile online for free today S. Efile online for free today Virgin Islands can now use the Social Security Administration's W-2 Online service to create, save, print, and submit up to 50 Forms W-2AS, W-2CM, W-2GU, or W-2VI at a time over the Internet. Efile online for free today Form W-3SS will be generated automatically based on your Forms W-2AS, W-2CM, W-2GU, or W-2VI. Efile online for free today For more information, visit Social Security Administration's SSA website at www. Efile online for free today ssa. Efile online for free today gov/bso/bsowelcome. Efile online for free today htm. Efile online for free today Credit or debit card payments. Efile online for free today  For information on paying your taxes with a credit or debit card, visit the IRS website at www. Efile online for free today irs. Efile online for free today gov/e-pay. Efile online for free today However, do not use credit or debit cards to make federal tax deposits. Efile online for free today Hiring new employees. Efile online for free today  Record the number and name from each new employee's social security card. Efile online for free today An employee who does not have a social security card should apply for one on Form SS-5, Application for a Social Security Card. Efile online for free today See section 3. Efile online for free today Reporting discrepancies between Forms 941-SS (or Form 944) and Forms W-2. Efile online for free today  File Schedule D (Form 941), Report of Discrepancies Caused by Acquisitions, Statutory Mergers, or Consolidations, to explain certain wage, tax, and payment discrepancies between Forms 941-SS (or Form 944), and Forms W-2 that were caused by acquisitions, statutory mergers, or consolidations. Efile online for free today For more information, see the Instructions for Schedule D (Form 941). Efile online for free today Apply for an employer identification number (EIN) online. Efile online for free today  You can apply for an EIN online by visiting IRS. Efile online for free today gov and clicking on the Apply for an EIN Online link under Tools. Efile online for free today Dishonored payments. Efile online for free today  Any form of payment that is dishonored and returned from a financial institution is subject to a penalty. Efile online for free today The penalty is $25 or 2% of the payment, whichever is more. Efile online for free today However, the penalty on dishonored payments of $24. Efile online for free today 99 or less is an amount equal to the payment. Efile online for free today For example, a dishonored payment of $18 is charged a penalty of $18. Efile online for free today Private delivery services. Efile online for free today  You can use certain private delivery services designated by the IRS to send tax returns or payments. Efile online for free today The list includes only the following: DHL Express (DHL): DHL Same Day Service. Efile online for free today Federal Express (FedEx): FedEx Priority Overnight, FedEx Standard Overnight, FedEx 2Day, FedEx International Priority, and FedEx International First. Efile online for free today United Parcel Service (UPS): UPS Next Day Air, UPS Next Day Air Saver, UPS 2nd Day Air, UPS 2nd Day Air A. Efile online for free today M. Efile online for free today , UPS Worldwide Express Plus, and UPS Worldwide Express. Efile online for free today For the IRS mailing address to use if you are using a private delivery service, go to IRS. Efile online for free today gov and enter “private delivery service” in the search box. Efile online for free today Your private delivery service can tell you how to get written proof of the mailing date. Efile online for free today Private delivery services cannot deliver items to P. Efile online for free today O. Efile online for free today boxes. Efile online for free today You must use the U. Efile online for free today S. Efile online for free today Postal Service to mail any item to an IRS P. Efile online for free today O. Efile online for free today box address. Efile online for free today Recordkeeping. Efile online for free today  Keep all records of employment taxes for 4 years. Efile online for free today These should be available for IRS review. Efile online for free today There is no required format for such records, but they should include your EIN; the amounts and dates of all wage payments (including fringe benefits) and tips reported; the names, addresses, and occupations of employees receiving such payments and their social security numbers; copies of returns filed; dates of employment; and the dates and amounts of deposits made. Efile online for free today Farm employers must keep a record of the name, permanent address, and EIN of each crew leader. Efile online for free today See Farm Crew Leaders in section 2. Efile online for free today Disregarded entities and qualified subchapter S subsidiaries (QSubs). Efile online for free today  Eligible single-owner disregarded entities and QSubs are treated as separate entities for employment tax purposes. Efile online for free today Eligible single-member entities that have not elected to be taxed as corporations must report and pay employment taxes on wages paid to their employees using the entities' own names and EINs. Efile online for free today See Regulations sections 1. Efile online for free today 1361-4(a)(7) and 301. Efile online for free today 7701-2(c)(2)(iv). Efile online for free today Photographs of missing children. Efile online for free today  The IRS is a proud partner with the National Center for Missing and Exploited Children. Efile online for free today Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. Efile online for free today You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child. Efile online for free today Calendar   If any date for filing a return, furnishing a form, or depositing taxes falls on a Saturday, Sunday, or legal holiday, the due date is the next business day. Efile online for free today A statewide legal holiday delays a filing due date only if the IRS office where you are required to file is located in that state. Efile online for free today However, a statewide legal holiday does not delay the due date of federal tax deposits. Efile online for free today See Deposits on Business Days Only in section 8. Efile online for free today For any filing due date, you will meet the “file” or “furnish” requirement if the envelope containing the return or form is properly addressed, contains sufficient postage, and is postmarked by the U. Efile online for free today S. Efile online for free today Postal Service on or before the due date, or sent by an IRS-designated delivery service on or before the due date. Efile online for free today See Private delivery services under Reminders. Efile online for free today The following are important dates and responsibilities. Efile online for free today Also see Publication 509, Tax Calendars. Efile online for free today By January 31. Efile online for free today   Furnish wage and tax statements to employees. Efile online for free today Give each employee a completed Form W-2AS, W-2CM, W-2GU, or W-2VI. Efile online for free today See section 10 for more information. Efile online for free today File Form 943, Employer's Annual Federal Tax Return for Agricultural Employees, with the IRS. Efile online for free today If you deposited all Form 943 taxes when due, you have 10 additional calendar days to file. Efile online for free today U. Efile online for free today S. Efile online for free today Virgin Islands employers only must file Form 940, Employer's Annual Federal Unemployment (FUTA) Tax Return, with the IRS. Efile online for free today Pay or deposit (if more than $500) any balance of the tax due. Efile online for free today If you deposited the full amount of taxes when due, you have 10 additional calendar days to file. Efile online for free today File Form 944 with the IRS if you were notified by the IRS to file Form 944 instead of quarterly Forms 941-SS. Efile online for free today If you deposited the full amount of taxes when due, you have 10 additional calendar days to file. Efile online for free today By February 28. Efile online for free today  File paper wage and tax statements with the Social Security Administration (SSA). Efile online for free today File Copy A of Forms W-2AS, W-2CM, W-2GU, or W-2VI, and Form W-3SS with the Social Security Administration (SSA). Efile online for free today For electronically filed returns, see By March 31 next. Efile online for free today By March 31. Efile online for free today  File electronic Forms W-2AS, W-2CM, W-2GU, or W-2VI with the SSA. Efile online for free today Visit the SSA's Reporting Instructions & Information webpage at www. Efile online for free today socialsecurity. Efile online for free today gov/employer for more information. Efile online for free today By April 30, July 31, October 31, and January 31. Efile online for free today  File Form 941-SS with the IRS. Efile online for free today If you deposited the full amount of taxes when due, you have 10 additional calendar days to file. Efile online for free today Do not file Forms 941-SS for these quarters if you have been notified to file Form 944 and you did not request to file quarterly Forms 941-SS. Efile online for free today Deposit FUTA tax for the quarter (including any amount carried over from other quarters) if over $500. Efile online for free today If $500 or less, carry it over to the next quarter. Efile online for free today See section 11 for more information. Efile online for free today Prev  Up  Next   Home   More Online Publications