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Federal Income Tax Forms 2012

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Federal Income Tax Forms 2012

Federal income tax forms 2012 4. Federal income tax forms 2012   Student Loan Interest Deduction Table of Contents Introduction Student Loan Interest DefinedQualified Student Loan Qualified Education Expenses Include As Interest Do Not Include As Interest When Must Interest Be Paid Can You Claim the DeductionNo Double Benefit Allowed Figuring the DeductionEffect of the Amount of Your Income on the Amount of Your Deduction Which Worksheet To Use Claiming the Deduction Introduction Generally, personal interest you pay, other than certain mortgage interest, is not deductible on your tax return. Federal income tax forms 2012 However, if your modified adjusted gross income (MAGI) is less than $75,000 ($155,000 if filing a joint return) there is a special deduction allowed for paying interest on a student loan (also known as an education loan) used for higher education. Federal income tax forms 2012 For most taxpayers, MAGI is the adjusted gross income as figured on their federal income tax return before subtracting any deduction for student loan interest. Federal income tax forms 2012 This deduction can reduce the amount of your income subject to tax by up to $2,500 in 2013. Federal income tax forms 2012 The student loan interest deduction is taken as an adjustment to income. Federal income tax forms 2012 This means you can claim this deduction even if you do not itemize deductions on Schedule A (Form 1040). Federal income tax forms 2012 This chapter explains: What type of loan interest you can deduct, Whether you can claim the deduction, What expenses you must have paid with the student loan, Who is an eligible student, How to figure the deduction, and How to claim the deduction. Federal income tax forms 2012 Table 4-1. Federal income tax forms 2012 Student Loan Interest Deduction at a Glance This table summarizes the features of the student loan interest deduction. Federal income tax forms 2012 Do not rely on this table alone. Federal income tax forms 2012 Refer to the text for complete details. Federal income tax forms 2012 Feature   Description Maximum benefit   You can reduce your income subject to tax by up to $2,500. Federal income tax forms 2012 Loan qualifications   Your student loan: •must have been taken out solely to pay qualified education expenses, and •cannot be from a related person or made under a qualified employer plan. Federal income tax forms 2012 Student qualifications   The student must be: •you, your spouse, or your dependent, and  •enrolled at least half-time in a degree program. Federal income tax forms 2012 Time limit on deduction   You can deduct interest paid during the remaining period of your student loan. Federal income tax forms 2012 Limit on modified adjusted gross income (MAGI)   $155,000 if married filing a joint return; $75,000 if single, head of household, or qualifying widow(er). Federal income tax forms 2012 Student Loan Interest Defined Student loan interest is interest you paid during the year on a qualified student loan. Federal income tax forms 2012 It includes both required and voluntary interest payments. Federal income tax forms 2012 Qualified Student Loan This is a loan you took out solely to pay qualified education expenses (defined later) that were: For you, your spouse, or a person who was your dependent when you took out the loan, Paid or incurred within a reasonable period of time before or after you took out the loan, and For education provided during an academic period for an eligible student. Federal income tax forms 2012 Loans from the following sources are not qualified student loans. Federal income tax forms 2012 A related person. Federal income tax forms 2012 A qualified employer plan. Federal income tax forms 2012 Your dependent. Federal income tax forms 2012   Generally, your dependent is someone who is either a: Qualifying child, or Qualifying relative. Federal income tax forms 2012 You can find more information about dependents in Publication 501. Federal income tax forms 2012 Exceptions. Federal income tax forms 2012   For purposes of the student loan interest deduction, there are the following exceptions to the general rules for dependents. Federal income tax forms 2012 An individual can be your dependent even if you are the dependent of another taxpayer. Federal income tax forms 2012 An individual can be your dependent even if the individual files a joint return with a spouse. Federal income tax forms 2012 An individual can be your dependent even if the individual had gross income for the year that was equal to or more than the exemption amount for the year ($3,900 for 2013). Federal income tax forms 2012 Reasonable period of time. Federal income tax forms 2012   Qualified education expenses are treated as paid or incurred within a reasonable period of time before or after you take out the loan if they are paid with the proceeds of student loans that are part of a federal postsecondary education loan program. Federal income tax forms 2012   Even if not paid with the proceeds of that type of loan, the expenses are treated as paid or incurred within a reasonable period of time if both of the following requirements are met. Federal income tax forms 2012 The expenses relate to a specific academic period, and The loan proceeds are disbursed within a period that begins 90 days before the start of that academic period and ends 90 days after the end of that academic period. Federal income tax forms 2012   If neither of the above situations applies, the reasonable period of time usually is determined based on all the relevant facts and circumstances. Federal income tax forms 2012 Academic period. Federal income tax forms 2012   An academic period includes a semester, trimester, quarter, or other period of study (such as a summer school session) as reasonably determined by an educational institution. Federal income tax forms 2012 In the case of an educational institution that uses credit hours or clock hours and does not have academic terms, each payment period can be treated as an academic period. Federal income tax forms 2012 Eligible student. Federal income tax forms 2012   This is a student who was enrolled at least half-time in a program leading to a degree, certificate, or other recognized educational credential. Federal income tax forms 2012 Enrolled at least half-time. Federal income tax forms 2012   A student was enrolled at least half-time if the student was taking at least half the normal full-time work load for his or her course of study. Federal income tax forms 2012   The standard for what is half of the normal full-time work load is determined by each eligible educational institution. Federal income tax forms 2012 However, the standard may not be lower than any of those established by the U. Federal income tax forms 2012 S. Federal income tax forms 2012 Department of Education under the Higher Education Act of 1965. Federal income tax forms 2012 Related person. Federal income tax forms 2012   You cannot deduct interest on a loan you get from a related person. Federal income tax forms 2012 Related persons include: Your spouse, Your brothers and sisters, Your half brothers and half sisters, Your ancestors (parents, grandparents, etc. Federal income tax forms 2012 ), Your lineal descendants (children, grandchildren, etc. Federal income tax forms 2012 ), and Certain corporations, partnerships, trusts, and exempt organizations. Federal income tax forms 2012 Qualified employer plan. Federal income tax forms 2012   You cannot deduct interest on a loan made under a qualified employer plan or under a contract purchased under such a plan. Federal income tax forms 2012 Qualified Education Expenses For purposes of the student loan interest deduction, these expenses are the total costs of attending an eligible educational institution, including graduate school. Federal income tax forms 2012 They include amounts paid for the following items. Federal income tax forms 2012 Tuition and fees. Federal income tax forms 2012 Room and board. Federal income tax forms 2012 Books, supplies, and equipment. Federal income tax forms 2012 Other necessary expenses (such as transportation). Federal income tax forms 2012 The cost of room and board qualifies only to the extent that it is not more than the greater of: The allowance for room and board, as determined by the eligible educational institution, that was included in the cost of attendance (for federal financial aid purposes) for a particular academic period and living arrangement of the student, or The actual amount charged if the student is residing in housing owned or operated by the eligible educational institution. Federal income tax forms 2012 Eligible educational institution. Federal income tax forms 2012   An eligible educational institution is any college, university, vocational school, or other postsecondary educational institution eligible to participate in a student aid program administered by the U. Federal income tax forms 2012 S. Federal income tax forms 2012 Department of Education. Federal income tax forms 2012 It includes virtually all accredited public, nonprofit, and proprietary (privately owned profit-making) postsecondary institutions. Federal income tax forms 2012   Certain educational institutions located outside the United States also participate in the U. Federal income tax forms 2012 S. Federal income tax forms 2012 Department of Education's Federal Student Aid (FSA) programs. Federal income tax forms 2012   For purposes of the student loan interest deduction, an eligible educational institution also includes an institution conducting an internship or residency program leading to a degree or certificate from an institution of higher education, a hospital, or a health care facility that offers postgraduate training. Federal income tax forms 2012   An educational institution must meet the above criteria only during the academic period(s) for which the student loan was incurred. Federal income tax forms 2012 The deductibility of interest on the loan is not affected by the institution's subsequent loss of eligibility. Federal income tax forms 2012    The educational institution should be able to tell you if it is an eligible educational institution. Federal income tax forms 2012 Adjustments to Qualified Education Expenses You must reduce your qualified education expenses by the total amount paid for them with the following tax-free items. Federal income tax forms 2012 Employer-provided educational assistance. Federal income tax forms 2012 See chapter 11, Employer-Provided Educational Assistance . Federal income tax forms 2012 Tax-free distribution of earnings from a Coverdell education savings account (ESA). Federal income tax forms 2012 See Tax-Free Distributions in chapter 7, Coverdell Education Savings Account. Federal income tax forms 2012 Tax-free distribution of earnings from a qualified tuition program (QTP). Federal income tax forms 2012 See Figuring the Taxable Portion of a Distribution in chapter 8, Qualified Tuition Program. Federal income tax forms 2012 U. Federal income tax forms 2012 S. Federal income tax forms 2012 savings bond interest that you exclude from income because it is used to pay qualified education expenses. Federal income tax forms 2012 See chapter 10, Education Savings Bond Program . Federal income tax forms 2012 The tax-free part of scholarships and fellowships. Federal income tax forms 2012 See Tax-Free Scholarships and Fellowships in chapter 1, Scholarships, Fellowships, Grants, and Tuition Reductions. Federal income tax forms 2012 Veterans' educational assistance. Federal income tax forms 2012 See Veterans' Benefits in chapter 1, Scholarships, Fellowships, Grants, and Tuition Reductions. Federal income tax forms 2012 Any other nontaxable (tax-free) payments (other than gifts or inheritances) received as educational assistance. Federal income tax forms 2012 Include As Interest In addition to simple interest on the loan, if all other requirements are met, the items discussed below can be student loan interest. Federal income tax forms 2012 Loan origination fee. Federal income tax forms 2012   In general, this is a one-time fee charged by the lender when a loan is made. Federal income tax forms 2012 To be deductible as interest, a loan origination fee must be for the use of money rather than for property or services (such as commitment fees or processing costs) provided by the lender. Federal income tax forms 2012 A loan origination fee treated as interest accrues over the term of the loan. Federal income tax forms 2012   Loan origination fees were not required to be reported on Form 1098-E, Student Loan Interest Statement, for loans made before September 1, 2004. Federal income tax forms 2012 If loan origination fees are not included in the amount reported on your Form 1098-E, you can use any reasonable method to allocate the loan origination fees over the term of the loan. Federal income tax forms 2012 The method shown in the example below allocates equal portions of the loan origination fee to each payment required under the terms of the loan. Federal income tax forms 2012 A method that results in the double deduction of the same portion of a loan origination fee would not be reasonable. Federal income tax forms 2012 Example. Federal income tax forms 2012 In August 2004, Bill took out a student loan for $16,000 to pay the tuition for his senior year of college. Federal income tax forms 2012 The lender charged a 3% loan origination fee ($480) that was withheld from the funds Bill received. Federal income tax forms 2012 Bill began making payments on his student loan in 2013. Federal income tax forms 2012 Because the loan origination fee was not included in his 2013 Form 1098-E, Bill can use any reasonable method to allocate that fee over the term of the loan. Federal income tax forms 2012 Bill's loan is payable in 120 equal monthly payments. Federal income tax forms 2012 He allocates the $480 fee equally over the total number of payments ($480 ÷ 120 months = $4 per month). Federal income tax forms 2012 Bill made 7 payments in 2013, so he paid $28 ($4 × 7) of interest attributable to the loan origination fee. Federal income tax forms 2012 To determine his student loan interest deduction, he will add the $28 to the amount of other interest reported to him on Form 1098-E. Federal income tax forms 2012 Capitalized interest. Federal income tax forms 2012   This is unpaid interest on a student loan that is added by the lender to the outstanding principal balance of the loan. Federal income tax forms 2012 Capitalized interest is treated as interest for tax purposes and is deductible as payments of principal are made on the loan. Federal income tax forms 2012 No deduction for capitalized interest is allowed in a year in which no loan payments were made. Federal income tax forms 2012 Interest on revolving lines of credit. Federal income tax forms 2012   This interest, which includes interest on credit card debt, is student loan interest if the borrower uses the line of credit (credit card) only to pay qualified education expenses. Federal income tax forms 2012 See Qualified Education Expenses , earlier. Federal income tax forms 2012 Interest on refinanced student loans. Federal income tax forms 2012   This includes interest on both: Consolidated loans—loans used to refinance more than one student loan of the same borrower, and Collapsed loans—two or more loans of the same borrower that are treated by both the lender and the borrower as one loan. Federal income tax forms 2012    If you refinance a qualified student loan for more than your original loan and you use the additional amount for any purpose other than qualified education expenses, you cannot deduct any interest paid on the refinanced loan. Federal income tax forms 2012 Voluntary interest payments. Federal income tax forms 2012   These are payments made on a qualified student loan during a period when interest payments are not required, such as when the borrower has been granted a deferment or the loan has not yet entered repayment status. Federal income tax forms 2012 Example. Federal income tax forms 2012 The payments on Roger's student loan were scheduled to begin in June 2012, 6 months after he graduated from college. Federal income tax forms 2012 He began making payments as required. Federal income tax forms 2012 In September 2013, Roger enrolled in graduate school on a full-time basis. Federal income tax forms 2012 He applied for and was granted deferment of his loan payments while in graduate school. Federal income tax forms 2012 Wanting to pay down his student loan as much as possible, he made loan payments in October and November 2013. Federal income tax forms 2012 Even though these were voluntary (not required) payments, Roger can deduct the interest paid in October and November. Federal income tax forms 2012 Allocating Payments Between Interest and Principal The allocation of payments between interest and principal for tax purposes might not be the same as the allocation shown on the Form 1098-E or other statement you receive from the lender or loan servicer. Federal income tax forms 2012 To make the allocation for tax purposes, a payment generally applies first to stated interest that remains unpaid as of the date the payment is due, second to any loan origination fees allocable to the payment, third to any capitalized interest that remains unpaid as of the date the payment is due, and fourth to the outstanding principal. Federal income tax forms 2012 Example. Federal income tax forms 2012 In August 2012, Peg took out a $10,000 student loan to pay the tuition for her senior year of college. Federal income tax forms 2012 The lender charged a 3% loan origination fee ($300) that was withheld from the funds Peg received. Federal income tax forms 2012 The interest (5% simple) on this loan accrued while she completed her senior year and for 6 months after she graduated. Federal income tax forms 2012 At the end of that period, the lender determined the amount to be repaid by capitalizing all accrued but unpaid interest ($625 interest accrued from August 2012 through October 2013) and adding it to the outstanding principal balance of the loan. Federal income tax forms 2012 The loan is payable over 60 months, with a payment of $200. Federal income tax forms 2012 51 due on the first of each month, beginning November 2013. Federal income tax forms 2012 Peg did not receive a Form 1098-E for 2013 from her lender because the amount of interest she paid did not require the lender to issue an information return. Federal income tax forms 2012 However, she did receive an account statement from the lender that showed the following 2013 payments on her outstanding loan of $10,625 ($10,000 principal + $625 accrued but unpaid interest). Federal income tax forms 2012 Payment Date   Payment   Stated Interest   Principal November 2013   $200. Federal income tax forms 2012 51   $44. Federal income tax forms 2012 27   $156. Federal income tax forms 2012 24 December 2013   $200. Federal income tax forms 2012 51   $43. Federal income tax forms 2012 62   $156. Federal income tax forms 2012 89 Totals   $401. Federal income tax forms 2012 02   $87. Federal income tax forms 2012 89   $313. Federal income tax forms 2012 13 To determine the amount of interest that could be deducted on the loan for 2013, Peg starts with the total amount of stated interest she paid, $87. Federal income tax forms 2012 89. Federal income tax forms 2012 Next, she allocates the loan origination fee over the term of the loan ($300 ÷ 60 months = $5 per month). Federal income tax forms 2012 A total of $10 ($5 of each of the two principal payments) should be treated as interest for tax purposes. Federal income tax forms 2012 Peg then applies the unpaid capitalized interest ($625) to the two principal payments in the order in which they were made, and determines that the remaining amount of principal of both payments is treated as interest for tax purposes. Federal income tax forms 2012 Assuming that Peg qualifies to take the student loan interest deduction, she can deduct $401. Federal income tax forms 2012 02 ($87. Federal income tax forms 2012 89 + $10 + $303. Federal income tax forms 2012 13). Federal income tax forms 2012 For 2014, Peg will continue to allocate $5 of the loan origination fee to the principal portion of each monthly payment she makes and treat that amount as interest for tax purposes. Federal income tax forms 2012 She also will apply the remaining amount of capitalized interest ($625 − $303. Federal income tax forms 2012 13 = $321. Federal income tax forms 2012 87) to the principal payments in the order in which they are made until the balance is zero, and treat those amounts as interest for tax purposes. Federal income tax forms 2012 Do Not Include As Interest You cannot claim a student loan interest deduction for any of the following items. Federal income tax forms 2012 Interest you paid on a loan if, under the terms of the loan, you are not legally obligated to make interest payments. Federal income tax forms 2012 Loan origination fees that are payments for property or services provided by the lender, such as commitment fees or processing costs. Federal income tax forms 2012 Interest you paid on a loan to the extent payments were made through your participation in the National Health Service Corps Loan Repayment Program (the “NHSC Loan Repayment Program”) or certain other loan repayment assistance programs. Federal income tax forms 2012 For more information, see Student Loan Repayment Assistance in chapter 5, Student Loan Cancellations and Repayment Assistance. Federal income tax forms 2012 When Must Interest Be Paid You can deduct all interest you paid during the year on your student loan, including voluntary payments, until the loan is paid off. Federal income tax forms 2012 Can You Claim the Deduction Generally, you can claim the deduction if all of the following requirements are met. Federal income tax forms 2012 Your filing status is any filing status except married filing separately. Federal income tax forms 2012 No one else is claiming an exemption for you on his or her tax return. Federal income tax forms 2012 You are legally obligated to pay interest on a qualified student loan. Federal income tax forms 2012 You paid interest on a qualified student loan. Federal income tax forms 2012 Claiming an exemption for you. Federal income tax forms 2012   Another taxpayer is claiming an exemption for you if he or she lists your name and other required information on his or her Form 1040 (or Form 1040A), line 6c, or Form 1040NR, line 7c. Federal income tax forms 2012 Example 1. Federal income tax forms 2012 During 2013, Josh paid $600 interest on his qualified student loan. Federal income tax forms 2012 Only he is legally obligated to make the payments. Federal income tax forms 2012 No one claimed an exemption for Josh for 2013. Federal income tax forms 2012 Assuming all other requirements are met, Josh can deduct the $600 of interest he paid on his 2013 Form 1040 or 1040A. Federal income tax forms 2012 Example 2. Federal income tax forms 2012 During 2013, Jo paid $1,100 interest on her qualified student loan. Federal income tax forms 2012 Only she is legally obligated to make the payments. Federal income tax forms 2012 Jo's parents claimed an exemption for her on their 2013 tax return. Federal income tax forms 2012 In this case, neither Jo nor her parents may deduct the student loan interest Jo paid in 2013. Federal income tax forms 2012 Interest paid by others. Federal income tax forms 2012   If you are the person legally obligated to make interest payments and someone else makes a payment of interest on your behalf, you are treated as receiving the payments from the other person and, in turn, paying the interest. Federal income tax forms 2012 Example 1. Federal income tax forms 2012 Darla obtained a qualified student loan to attend college. Federal income tax forms 2012 After Darla's graduation from college, she worked as an intern for a nonprofit organization. Federal income tax forms 2012 As part of the internship program, the nonprofit organization made an interest payment on behalf of Darla. Federal income tax forms 2012 This payment was treated as additional compensation and reported in box 1 of her Form W-2. Federal income tax forms 2012 Assuming all other qualifications are met, Darla can deduct this payment of interest on her tax return. Federal income tax forms 2012 Example 2. Federal income tax forms 2012 Ethan obtained a qualified student loan to attend college. Federal income tax forms 2012 After graduating from college, the first monthly payment on his loan was due in December. Federal income tax forms 2012 As a gift, Ethan's mother made this payment for him. Federal income tax forms 2012 No one is claiming a dependency exemption for Ethan on his or her tax return. Federal income tax forms 2012 Assuming all other qualifications are met, Ethan can deduct this payment of interest on his tax return. Federal income tax forms 2012 No Double Benefit Allowed You cannot deduct as interest on a student loan any amount that is an allowable deduction under any other provision of the tax law (for example, as home mortgage interest). Federal income tax forms 2012 Figuring the Deduction Your student loan interest deduction for 2013 is generally the smaller of: $2,500, or The interest you paid in 2013. Federal income tax forms 2012 However, the amount determined above may be gradually reduced (phased out) or eliminated based on your filing status and MAGI as explained below. Federal income tax forms 2012 You can use Worksheet 4-1. Federal income tax forms 2012 Student Loan Interest Deduction Worksheet (at the end of this chapter) to figure both your MAGI and your deduction. Federal income tax forms 2012 Form 1098-E. Federal income tax forms 2012   To help you figure your student loan interest deduction, you should receive Form 1098-E. Federal income tax forms 2012 Generally, an institution (such as a bank or governmental agency) that received interest payments of $600 or more during 2013 on one or more qualified student loans must send Form 1098-E (or acceptable substitute) to each borrower by January 31, 2014. Federal income tax forms 2012   For qualified student loans taken out before September 1, 2004, the institution is required to include on Form 1098-E only payments of stated interest. Federal income tax forms 2012 Other interest payments, such as certain loan origination fees and capitalized interest, may not appear on the form you receive. Federal income tax forms 2012 However, if you pay qualifying interest that is not included on Form 1098-E, you can also deduct those amounts. Federal income tax forms 2012 See Allocating Payments Between Interest and Principal , earlier. Federal income tax forms 2012    The lender may ask for a completed Form W-9S, or similar statement to obtain the borrower's name, address, and taxpayer identification number. Federal income tax forms 2012 The form may also be used by the borrower to certify that the student loan was incurred solely to pay for qualified education expenses. Federal income tax forms 2012 Effect of the Amount of Your Income on the Amount of Your Deduction The amount of your student loan interest deduction is phased out (gradually reduced) if your MAGI is between $60,000 and $75,000 ($125,000 and $155,000 if you file a joint return). Federal income tax forms 2012 You cannot take a student loan interest deduction if your MAGI is $75,000 or more ($155,000 or more if you file a joint return). Federal income tax forms 2012 Modified adjusted gross income (MAGI). Federal income tax forms 2012   For most taxpayers, MAGI is adjusted gross income (AGI) as figured on their federal income tax return before subtracting any deduction for student loan interest. Federal income tax forms 2012 However, as discussed below, there may be other modifications. Federal income tax forms 2012 Table 4-2 shows how the amount of your MAGI can affect your student loan interest deduction. Federal income tax forms 2012 Table 4-2. Federal income tax forms 2012 Effect of MAGI on Student Loan Interest Deduction IF your filing status is. Federal income tax forms 2012 . Federal income tax forms 2012 . Federal income tax forms 2012 AND your MAGI is. Federal income tax forms 2012 . Federal income tax forms 2012 . Federal income tax forms 2012 THEN your student loan interest deduction is. Federal income tax forms 2012 . Federal income tax forms 2012 . Federal income tax forms 2012 single,  head of household, or qualifying widow(er) not more than $60,000 not affected by the phaseout. Federal income tax forms 2012 more than $60,000  but less than $75,000 reduced because of the phaseout. Federal income tax forms 2012 $75,000 or more eliminated by the phaseout. Federal income tax forms 2012 married filing joint return not more than $125,000 not affected by the phaseout. Federal income tax forms 2012 more than $125,000 but less than $155,000 reduced because of the phaseout. Federal income tax forms 2012 $155,000 or more eliminated by the phaseout. Federal income tax forms 2012 MAGI when using Form 1040A. Federal income tax forms 2012   If you file Form 1040A, your MAGI is the AGI on line 22 of that form figured without taking into account any amount on line 18 (student loan interest deduction) and line 19 (tuition and fees deduction). Federal income tax forms 2012 MAGI when using Form 1040. Federal income tax forms 2012   If you file Form 1040, your MAGI is the AGI on line 38 of that form figured without taking into account any amount on line 33 (student loan interest deduction), line 34 (tuition and fees deduction), or line 35 (domestic production activities deduction), and modified by adding back any: Foreign earned income exclusion, Foreign housing exclusion, Foreign housing deduction, Exclusion of income by bona fide residents of American Samoa, and Exclusion of income by bona fide residents of Puerto Rico. Federal income tax forms 2012 MAGI when using Form 1040NR. Federal income tax forms 2012   If you file Form 1040NR, your MAGI is the AGI on line 36 of that form figured without taking into account any amount on line 33 (student loan interest deduction) and line 34 (domestic production activities deduction). Federal income tax forms 2012 MAGI when using Form 1040NR-EZ. Federal income tax forms 2012   If you file Form 1040NR-EZ, your MAGI is the AGI on line 10 of that form figured without taking into account any amount on line 9 (student loan interest deduction). Federal income tax forms 2012 Phaseout. Federal income tax forms 2012   If your MAGI is within the range of incomes where the credit must be reduced, you must figure your reduced deduction. Federal income tax forms 2012 To figure the phaseout, multiply your interest deduction (before the phaseout) by a fraction. Federal income tax forms 2012 The numerator is your MAGI minus $60,000 ($125,000 in the case of a joint return). Federal income tax forms 2012 The denominator is $15,000 ($30,000 in the case of a joint return). Federal income tax forms 2012 Subtract the result from your deduction (before the phaseout) to give you the amount you can deduct. Federal income tax forms 2012 Example 1. Federal income tax forms 2012 During 2013 you paid $800 interest on a qualified student loan. Federal income tax forms 2012 Your 2013 MAGI is $145,000 and you are filing a joint return. Federal income tax forms 2012 You must reduce your deduction by $533, figured as follows. Federal income tax forms 2012   $800 × $145,000 − $125,000  $30,000 = $533   Your reduced student loan interest deduction is $267 ($800 − $533). Federal income tax forms 2012 Example 2. Federal income tax forms 2012 The facts are the same as in Example 1 except that you paid $2,750 interest. Federal income tax forms 2012 Your maximum deduction for 2013 is $2,500. Federal income tax forms 2012 You must reduce your maximum deduction by $1,667, figured as follows. Federal income tax forms 2012   $2,500 × $145,000 − $125,000  $30,000 = $1,667   In this example, your reduced student loan interest deduction is $833 ($2,500 − $1,667). Federal income tax forms 2012 Which Worksheet To Use Generally, you figure the deduction using the Student Loan Interest Deduction Worksheet in the instructions for Form 1040, Form 1040A, or Form 1040NR. Federal income tax forms 2012 However, if you are filing Form 2555, Foreign Earned Income, Form 2555-EZ, Foreign Earned Income Exclusion, or Form 4563, Exclusion of Income for Bona Fide Residents of American Samoa, or you are excluding income from sources within Puerto Rico, you must complete Worksheet 4-1. Federal income tax forms 2012 Student Loan Interest Deduction Worksheet at the end of this chapter. Federal income tax forms 2012 Claiming the Deduction The student loan interest deduction is an adjustment to income. Federal income tax forms 2012 To claim the deduction, enter the allowable amount on line 33 (Form 1040), line 18 (Form 1040A), line 33 (Form 1040NR), or line 9 (Form 1040NR-EZ). Federal income tax forms 2012 Worksheet 4-1. Federal income tax forms 2012 Student Loan Interest Deduction Worksheet Use this worksheet instead of the worksheet in the Form 1040 instructions if you are filing Form 2555, 2555-EZ, or 4563, or you are excluding income from sources within Puerto Rico. Federal income tax forms 2012 Before using this worksheet, you must complete Form 1040, lines 7 through 32, plus any amount to be entered on the dotted line next to line 36. Federal income tax forms 2012 1. Federal income tax forms 2012 Enter the total interest you paid in 2013 on qualified student loans. Federal income tax forms 2012 Do not enter  more than $2,500 1. Federal income tax forms 2012   2. Federal income tax forms 2012 Enter the amount from Form 1040, line 22 2. Federal income tax forms 2012       3. Federal income tax forms 2012 Enter the total of the amounts from Form 1040,  lines 23 through 32 3. Federal income tax forms 2012           4. Federal income tax forms 2012 Enter the total of any amounts entered on the dotted line next to Form 1040, line 36 4. Federal income tax forms 2012           5. Federal income tax forms 2012 Add lines 3 and 4 5. Federal income tax forms 2012       6. Federal income tax forms 2012 Subtract line 5 from line 2 6. Federal income tax forms 2012       7. Federal income tax forms 2012 Enter any foreign earned income exclusion and/or housing  exclusion (Form 2555, line 45, or Form 2555-EZ, line 18) 7. Federal income tax forms 2012       8. Federal income tax forms 2012 Enter any foreign housing deduction (Form 2555, line 50) 8. Federal income tax forms 2012       9. Federal income tax forms 2012 Enter the amount of income from Puerto Rico you are excluding 9. Federal income tax forms 2012       10. Federal income tax forms 2012 Enter the amount of income from American Samoa  you are excluding (Form 4563, line 15) 10. Federal income tax forms 2012       11. Federal income tax forms 2012 Add lines 6 through 10. Federal income tax forms 2012 This is your modified adjusted gross income 11. Federal income tax forms 2012   12. Federal income tax forms 2012 Enter the amount shown below for your filing status 12. Federal income tax forms 2012     •Single, head of household, or qualifying widow(er)—$60,000       •Married filing jointly—$125,000     13. Federal income tax forms 2012 Is the amount on line 11 more than the amount on line 12?       □ No. Federal income tax forms 2012 Skip lines 13 and 14, enter -0- on line 15, and go to line 16. Federal income tax forms 2012       □ Yes. Federal income tax forms 2012 Subtract line 12 from line 11 13. Federal income tax forms 2012   14. Federal income tax forms 2012 Divide line 13 by $15,000 ($30,000 if married filing jointly). Federal income tax forms 2012 Enter the result as a decimal  (rounded to at least three places). Federal income tax forms 2012 If the result is 1. Federal income tax forms 2012 000 or more, enter 1. Federal income tax forms 2012 000 14. Federal income tax forms 2012 . Federal income tax forms 2012 15. Federal income tax forms 2012 Multiply line 1 by line 14 15. Federal income tax forms 2012   16. Federal income tax forms 2012 Student loan interest deduction. Federal income tax forms 2012 Subtract line 15 from line 1. Federal income tax forms 2012 Enter the result here  and on Form 1040, line 33. Federal income tax forms 2012 Do not include this amount in figuring any other  deduction on your return (such as on Schedule A, C, E, etc. Federal income tax forms 2012 ) 16. Federal income tax forms 2012   Prev  Up  Next   Home   More Online Publications
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The Federal Income Tax Forms 2012

Federal income tax forms 2012 5. Federal income tax forms 2012   Manufacturers Taxes Table of Contents Importer. Federal income tax forms 2012 Use considered sale. Federal income tax forms 2012 Lease considered sale. Federal income tax forms 2012 Bonus goods. Federal income tax forms 2012 Taxable Event ExemptionsRequirements for Exempt Sales Credits or Refunds Sport Fishing EquipmentRelated person. Federal income tax forms 2012 Bows, Quivers, Broadheads, and Points Arrow ShaftsExemption for certain wooden arrows. Federal income tax forms 2012 CoalExported. Federal income tax forms 2012 Taxable TiresQualifying intercity or local bus. Federal income tax forms 2012 Qualifying school bus. Federal income tax forms 2012 Gas Guzzler TaxVehicles not subject to tax. Federal income tax forms 2012 Imported automobiles. Federal income tax forms 2012 VaccinesConditions to allowance. Federal income tax forms 2012 Taxable Medical Devices The following discussion of manufacturers taxes applies to the tax on: Sport fishing equipment; Fishing rods and fishing poles; Electric outboard motors; Fishing tackle boxes; Bows, quivers, broadheads, and points; Arrow shafts; Coal; Taxable tires; Gas guzzler automobiles; and Vaccines. Federal income tax forms 2012 Manufacturer. Federal income tax forms 2012   The term “manufacturer” includes a producer or importer. Federal income tax forms 2012 A manufacturer is any person who produces a taxable article from new or raw material, or from scrap, salvage, or junk material, by processing or changing the form of an article or by combining or assembling two or more articles. Federal income tax forms 2012 If you furnish the materials and keep title to those materials and to the finished article, you are considered the manufacturer even though another person actually manufactures the taxable article. Federal income tax forms 2012   A manufacturer who sells a taxable article in knockdown (unassembled) condition is liable for the tax. Federal income tax forms 2012 The person who buys these component parts and assembles a taxable article may also be liable for tax as a further manufacturer depending on the labor, material, and overhead required to assemble the completed article if the article is assembled for business use. Federal income tax forms 2012 Importer. Federal income tax forms 2012   An importer is a person who brings a taxable article into the United States, or withdraws a taxable article from a customs bonded warehouse for sale or use in the United States. Federal income tax forms 2012 Sale. Federal income tax forms 2012   A sale is the transfer of the title to, or the substantial incidents of ownership in, an article to a buyer for consideration that may consist of money, services, or other things. Federal income tax forms 2012 Use considered sale. Federal income tax forms 2012   A manufacturer who uses a taxable article is liable for the tax in the same manner as if it were sold. Federal income tax forms 2012 Lease considered sale. Federal income tax forms 2012   The lease of an article (including any renewal or extension of the lease) by the manufacturer is generally considered a taxable sale. Federal income tax forms 2012 However, for the gas guzzler tax, only the first lease (excluding any renewal or extension) of the automobile by the manufacturer is considered a sale. Federal income tax forms 2012 Manufacturers taxes based on sale price. Federal income tax forms 2012   The manufacturers taxes imposed on the sale of sport fishing equipment, electric outboard motors, and bows are based on the sale price of the article. Federal income tax forms 2012 The taxes imposed on coal are based either on the sale price or the weight. Federal income tax forms 2012   The price for which an article is sold includes the total consideration paid for the article, whether that consideration is in the form of money, services, or other things. Federal income tax forms 2012 However, you include certain charges made when a taxable article is sold and you exclude others. Federal income tax forms 2012 To figure the price on which you base the tax, use the following rules. Federal income tax forms 2012 Include both the following charges in the price. Federal income tax forms 2012 Any charge for coverings or containers (regardless of their nature). Federal income tax forms 2012 Any charge incident to placing the article in a condition packed ready for shipment. Federal income tax forms 2012 Exclude all the following amounts from the price. Federal income tax forms 2012 The manufacturers excise tax, whether or not it is stated as a separate charge. Federal income tax forms 2012 The transportation charges pursuant to the sale. Federal income tax forms 2012 The cost of transportation of goods to a warehouse before their bona fide sale is not excludable. Federal income tax forms 2012 Delivery, insurance, installation, retail dealer preparation charges, and other charges you incur in placing the article in the hands of the purchaser under a bona fide sale. Federal income tax forms 2012 Discounts, rebates, and similar allowances actually granted to the purchaser. Federal income tax forms 2012 Local advertising charges. Federal income tax forms 2012 A charge made separately when the article is sold and that qualifies as a charge for “local advertising” may, within certain limits, be excluded from the sale price. Federal income tax forms 2012 Charges for warranty paid at the purchaser's option. Federal income tax forms 2012 However, a charge for a warranty of an article that the manufacturer requires the purchaser to pay to obtain the article is included in the sale price on which the tax is figured. Federal income tax forms 2012 Bonus goods. Federal income tax forms 2012   Allocate the sale price if you give free nontaxable goods with the purchase of taxable merchandise. Federal income tax forms 2012 Figure the tax only on the sale price attributable to the taxable articles. Federal income tax forms 2012 Example. Federal income tax forms 2012 A manufacturer sells a quantity of taxable articles and gives the purchaser certain nontaxable articles as a bonus. Federal income tax forms 2012 The sale price of the shipment is $1,500. Federal income tax forms 2012 The normal sale price is $2,000: $1,500 for the taxable articles and $500 for the nontaxable articles. Federal income tax forms 2012 Since the taxable items represent 75% of the normal sale price, the tax is based on 75% of the actual sale price, or $1,125 (75% of $1,500). Federal income tax forms 2012 The remaining $375 is allocated to the nontaxable articles. Federal income tax forms 2012 Taxable Event Tax attaches when the title to the article sold passes from the manufacturer to the buyer. Federal income tax forms 2012 When the title passes depends on the intention of the parties as gathered from the contract of sale. Federal income tax forms 2012 In the absence of expressed intention, the legal rules of presumption followed in the jurisdiction where the sale occurs determine when title passes. Federal income tax forms 2012 If the taxable article is used by the manufacturer, the tax attaches at the time use begins. Federal income tax forms 2012 The manufacturer is liable for the tax. Federal income tax forms 2012 Partial payments. Federal income tax forms 2012   The tax applies to each partial payment received when taxable articles are: Leased, Sold conditionally, Sold on installment with chattel mortgage, or Sold on installment with title to pass in the future. Federal income tax forms 2012 To figure the tax, multiply the partial payment by the tax rate in effect at the time of the payment. Federal income tax forms 2012 Exemptions The following sales by the manufacturer are exempt from the manufacturers tax. Federal income tax forms 2012 Sale of an article to a state or local government for the exclusive use of the state or local government. Federal income tax forms 2012 This exemption does not apply to the taxes on coal, gas guzzlers, and vaccines. Federal income tax forms 2012 State is defined in Definitions in chapter 1. Federal income tax forms 2012 Sale of an article to a nonprofit educational organization for its exclusive use. Federal income tax forms 2012 This exemption does not apply to the taxes on coal, gas guzzlers, and vaccines. Federal income tax forms 2012 Nonprofit educational organization is defined under Communications Tax in chapter 4. Federal income tax forms 2012 Sale of an article to a qualified blood collector organization. Federal income tax forms 2012 This exemption does not apply to gas guzzlers, recreational equipment, and vaccines. Federal income tax forms 2012 Qualified blood collector organizations are defined under Communications Tax in chapter 4. Federal income tax forms 2012 Sale of an article for use by the purchaser as supplies for vessels. Federal income tax forms 2012 This exemption does not apply to the taxes on coal and vaccines. Federal income tax forms 2012 Supplies for vessels means ships' stores, sea stores, or legitimate equipment on vessels of war of the United States or any foreign nation, vessels employed in the fisheries or whaling business, or vessels actually engaged in foreign trade. Federal income tax forms 2012 Sale of an article for use by the purchaser for further manufacture, or for resale by the purchaser to a second purchaser for use by the second purchaser for further manufacture. Federal income tax forms 2012 This exemption does not apply to the tax on coal and tires. Federal income tax forms 2012 Use for further manufacture means use in the manufacture or production of an article subject to the manufacturers excise taxes. Federal income tax forms 2012 If you buy articles tax free and resell or use them other than in the manufacture of another article, you are liable for the tax on their resale or use just as if you had manufactured and sold them. Federal income tax forms 2012 Sale of an article for export or for resale by the purchaser to a second purchaser for export. Federal income tax forms 2012 The article may be exported to a foreign country or to a possession of the United States. Federal income tax forms 2012 A vaccine shipped to a possession of the United States is not considered to be exported. Federal income tax forms 2012 If an article is sold tax free for export and the manufacturer does not receive proof of export, described later, the manufacturer is liable for the tax. Federal income tax forms 2012 Sales of articles of native Indian handicraft, such as bows and arrow shafts, manufactured by Indians on reservations, in Indian schools, or under U. Federal income tax forms 2012 S. Federal income tax forms 2012 jurisdiction in Alaska. Federal income tax forms 2012 For tire exemptions, see section 4221(e)(2). Federal income tax forms 2012 Requirements for Exempt Sales The following requirements must be met for a sale to be exempt from the manufacturers tax. Federal income tax forms 2012 Registration requirements. Federal income tax forms 2012   The manufacturer, first purchaser, and second purchaser in the case of resales must be registered. Federal income tax forms 2012 See the Form 637 instructions for more information. Federal income tax forms 2012 Exceptions to registration requirements. Federal income tax forms 2012   Registration is not required for: State or local governments, Foreign purchasers of articles sold or resold for export, The United States, or Parties to a sale of supplies for vessels and aircraft. Federal income tax forms 2012 Certification requirement. Federal income tax forms 2012   If the purchaser is required to be registered, the purchaser must give the manufacturer its registration number and certify the exempt purpose for which the article will be used. Federal income tax forms 2012 The information must be in writing and may be noted on the purchase order or other document furnished by the purchaser to the seller in connection with the sale. Federal income tax forms 2012   For a sale to a state or local government, an exemption certificate must be signed by an officer or employee authorized by the state or local government. Federal income tax forms 2012 See Regulations section 48. Federal income tax forms 2012 4221-5(c) for the certificate requirements. Federal income tax forms 2012   For sales for use as supplies for vessels and aircraft, if the manufacturer and purchaser are not registered, the owner or agent of the vessel must provide an exemption certificate to the manufacturer before or at the time of sale. Federal income tax forms 2012 See Regulations section 48. Federal income tax forms 2012 4221-4(d) for the certificate requirements. Federal income tax forms 2012 Proof of export requirement. Federal income tax forms 2012   Within 6 months of the date of sale or shipment by the manufacturer, whichever is earlier, the manufacturer must receive proof of exportation. Federal income tax forms 2012 See Regulations section 48. Federal income tax forms 2012 4221-3(d) for evidence that qualifies as proof of exportation. Federal income tax forms 2012 Proof of resale for further manufacture requirement. Federal income tax forms 2012   Within 6 months of the date of sale or shipment by the manufacturer, whichever is earlier, the manufacturer must receive proof that the article has been resold for use in further manufacture. Federal income tax forms 2012 See Regulations section 48. Federal income tax forms 2012 4221-2(c) for evidence that qualifies as proof of resale. Federal income tax forms 2012 Information to be furnished to purchaser. Federal income tax forms 2012   The manufacturer must indicate to the purchaser that the articles normally would be subject to tax and are being sold tax free for an exempt purpose because the purchaser has provided the required certificate. Federal income tax forms 2012 Credits or Refunds The manufacturer may be eligible to obtain a credit or refund of the manufacturers tax for certain uses, sales, exports, and price readjustments. Federal income tax forms 2012 The claim must set forth in detail the facts upon which the claim is based. Federal income tax forms 2012 Uses, sales, and exports. Federal income tax forms 2012   A credit or refund (without interest) of the manufacturers taxes may be allowable if a tax-paid article is, by any person: Exported, Used or sold for use as supplies for vessels (except for coal and vaccines), Sold to a state or local government for its exclusive use (except for coal, gas guzzlers, and vaccines), Sold to a nonprofit educational organization for its exclusive use (except for coal, gas guzzlers, and vaccines), Sold to a qualified blood collector organization for its exclusive use (except for gas guzzlers, recreational equipment, and vaccines), or Used for further manufacture of another article subject to the manufacturers taxes (except for coal). Federal income tax forms 2012 Export. Federal income tax forms 2012   If a tax-paid article is exported, the exporter or shipper may claim a credit or refund if the manufacturer waives its right to claim the credit or refund. Federal income tax forms 2012 In the case of a tax-paid article used to make another taxable article, the subsequent manufacturer may claim the credit or refund. Federal income tax forms 2012 Price readjustments. Federal income tax forms 2012   In addition, a credit or refund (without interest) may be allowable for a tax-paid article for which the price is readjusted by reason of return or repossession of the article or a bona fide discount, rebate, or allowance for taxes based on price. Federal income tax forms 2012 Conditions to allowance. Federal income tax forms 2012   To claim a credit or refund in the case of export; supplies for vessels; or sales to a state or local government, nonprofit educational organization, or qualified blood collector organization; the person who paid the tax must certify on the claim that one of the following applies and that the claimant has the required supporting information. Federal income tax forms 2012 The claimant sold the article at a tax-excluded price. Federal income tax forms 2012 The person has repaid, or agreed to repay, the tax to the ultimate vendor of the article. Federal income tax forms 2012 The person has obtained the written consent of the ultimate vendor to make the claim. Federal income tax forms 2012 The ultimate vendor generally is the seller making the sale that gives rise to the overpayment of tax. Federal income tax forms 2012 Claim for further manufacture. Federal income tax forms 2012   To claim a credit or refund for further manufacture, the claimant must include a statement that contains the following. Federal income tax forms 2012 The name and address of the manufacturer and the date of payment. Federal income tax forms 2012 An identification of the article for which the credit or refund is claimed. Federal income tax forms 2012 The amount of tax paid on the article and the date on which it was paid. Federal income tax forms 2012 Information indicating that the article was used as material in the manufacture or production of, or as a component part of, a second article manufactured or produced by the manufacturer, or was sold on or in connection with, or with the sale of a second article manufactured or produced by the manufacturer. Federal income tax forms 2012 An identification of the second article. Federal income tax forms 2012   For claims by the exporter or shipper, the claim must contain the proof of export and a statement signed by the person that paid the tax waiving the right to claim a credit or refund. Federal income tax forms 2012 The statement must include the amount of tax paid, the date of payment, and the office to which it was paid. Federal income tax forms 2012 Claim for price readjustment. Federal income tax forms 2012   To claim a credit or refund for a price readjustment, the person who paid the tax must include with the claim, a statement that contains the following. Federal income tax forms 2012 A description of the circumstances that gave rise to the price readjustment. Federal income tax forms 2012 An identification of the article whose price was readjusted. Federal income tax forms 2012 The price at which the article was sold. Federal income tax forms 2012 The amount of tax paid on the article and the date on which it was paid. Federal income tax forms 2012 The name and address of the purchaser. Federal income tax forms 2012 The amount repaid to the purchaser or credited to the purchaser's account. Federal income tax forms 2012 Sport Fishing Equipment A tax of 10% of the sale price is imposed on many articles of sport fishing equipment sold by the manufacturer. Federal income tax forms 2012 This includes any parts or accessories sold on or in connection with the sale of those articles. Federal income tax forms 2012 Pay this tax with Form 720. Federal income tax forms 2012 No tax deposits are required. Federal income tax forms 2012 Sport fishing equipment includes all the following items. Federal income tax forms 2012 Fishing rods and poles (and component parts), fishing reels, fly fishing lines, and other fishing lines not over 130 pounds test, fishing spears, spear guns, and spear tips. Federal income tax forms 2012 Items of terminal tackle, including leaders, artificial lures, artificial baits, artificial flies, fishing hooks, bobbers, sinkers, snaps, drayles, and swivels (but not including natural bait or any item of terminal tackle designed for use and ordinarily used on fishing lines not described in (1)). Federal income tax forms 2012 The following items of fishing supplies and accessories: fish stringers, creels, bags, baskets, and other containers designed to hold fish, portable bait containers, fishing vests, landing nets, gaff hooks, fishing hook disgorgers, and dressing for fishing lines and artificial flies. Federal income tax forms 2012 Fishing tip-ups and tilts. Federal income tax forms 2012 Fishing rod belts, fishing rodholders, fishing harnesses, fish fighting chairs, fishing outriggers, and fishing downriggers. Federal income tax forms 2012 See Revenue Ruling 88-52 in Cumulative Bulletin 1988-1 for a more complete description of the items of taxable equipment. Federal income tax forms 2012 Fishing rods and fishing poles. Federal income tax forms 2012   The tax on fishing rods and fishing poles (and component parts) is 10% of the sales price not to exceed $10 per article. Federal income tax forms 2012 The tax is paid by the manufacturer, producer, or importer. Federal income tax forms 2012 Fishing tackle boxes. Federal income tax forms 2012   The tax on fishing tackle boxes is 3% of the sales price. Federal income tax forms 2012 The tax is paid by the manufacturer, producer, or importer. Federal income tax forms 2012 Electric outboard boat motors. Federal income tax forms 2012   A tax of 3% of the sale price is imposed on the sale by the manufacturer of electric outboard motors. Federal income tax forms 2012 This includes any parts or accessories sold on or in connection with the sale of those articles. Federal income tax forms 2012 Certain equipment resale. Federal income tax forms 2012   The tax on the sale of sport fishing equipment is imposed a second time under the following circumstances. Federal income tax forms 2012 If the manufacturer sells a taxable article to any person, the manufacturer is liable for the tax. Federal income tax forms 2012 If the purchaser or any other person then sells it to a person who is related (discussed next) to the manufacturer, that related person is liable for a second tax on any subsequent sale of the article. Federal income tax forms 2012 The second tax, however, is not imposed if the constructive sale price rules under section 4216(b) apply to the sale by the manufacturer. Federal income tax forms 2012   If the second tax is imposed, a credit for tax previously paid by the manufacturer is available provided the related person can document the tax paid. Federal income tax forms 2012 The documentation requirement is generally satisfied only through submission of copies of actual records of the person that previously paid the tax. Federal income tax forms 2012 Related person. Federal income tax forms 2012   For the tax on sport fishing equipment, a person is a related person of the manufacturer if that person and the manufacturer have a relationship described in section 465(b)(3)(C). Federal income tax forms 2012 Bows, Quivers, Broadheads, and Points The tax on bows is 11% (. Federal income tax forms 2012 11) of the sales price. Federal income tax forms 2012 The tax is paid by the manufacturer, producer, or importer. Federal income tax forms 2012 It applies to bows having a peak draw weight of 30 pounds or more. Federal income tax forms 2012 The tax is also imposed on the sale of any part or accessory suitable for inclusion in or attachment to a taxable bow and any quiver, broadhead, or point suitable for use with arrows described below. Federal income tax forms 2012 Pay this tax with Form 720. Federal income tax forms 2012 No tax deposits are required. Federal income tax forms 2012 Arrow Shafts The tax on arrow shafts is listed on Form 720. Federal income tax forms 2012 The tax is paid by the manufacturer, producer, or importer of any arrow shaft (whether sold separately or incorporated as part of a finished or unfinished product) of a type used in the manufacture of any arrow that after its assembly meets either of the following conditions. Federal income tax forms 2012 It measures 18 inches or more in overall length. Federal income tax forms 2012 It measures less than 18 inches in overall length but is suitable for use with a taxable bow, described earlier. Federal income tax forms 2012 Exemption for certain wooden arrows. Federal income tax forms 2012   After October 3, 2008, the tax does not apply to any shaft made of all natural wood with no laminations or artificial means of enhancing the spine of such shaft (whether sold separately or incorporated as part of a finished or unfinished product) and used in the manufacture of any arrow that after its assembly meets both of the following conditions. Federal income tax forms 2012 It measures 5/16 of an inch or less in diameter. Federal income tax forms 2012 It is not suitable for use with a taxable bow, described earlier. Federal income tax forms 2012 Pay this tax with Form 720. Federal income tax forms 2012 No tax deposits are required. Federal income tax forms 2012 Coal A tax is imposed on the first sale of coal mined in the United States. Federal income tax forms 2012 The producer of the coal is liable for the tax. Federal income tax forms 2012 The producer is the person who has vested ownership of the coal under state law immediately after the coal is severed from the ground. Federal income tax forms 2012 Determine vested ownership without regard to any contractual arrangement for the sale or other disposition of the coal or the payment of any royalties between the producer and third parties. Federal income tax forms 2012 A producer includes any person who extracts coal from coal waste refuse piles (or from the silt waste product that results from the wet washing of coal). Federal income tax forms 2012 The tax is not imposed on coal extracted from a riverbed by dredging if it can be shown that the coal has been taxed previously. Federal income tax forms 2012 Tax rates. Federal income tax forms 2012   The tax on underground-mined coal is the lower of: $1. Federal income tax forms 2012 10 a ton, or 4. Federal income tax forms 2012 4% of the sale price. Federal income tax forms 2012   The tax on surface-mined coal is the lower of: 55 cents a ton, or 4. Federal income tax forms 2012 4% of the sale price. Federal income tax forms 2012   Coal will be taxed at the 4. Federal income tax forms 2012 4% rate if the selling price is less than $25 a ton for underground-mined coal and less than $12. Federal income tax forms 2012 50 a ton for surface-mined coal. Federal income tax forms 2012 Apply the tax proportionately if a sale or use includes a portion of a ton. Federal income tax forms 2012 Example. Federal income tax forms 2012 If you sell 21,000 pounds (10. Federal income tax forms 2012 5 tons) of coal from an underground mine for $525, the price per ton is $50. Federal income tax forms 2012 The tax is $1. Federal income tax forms 2012 10 × 10. Federal income tax forms 2012 5 tons ($11. Federal income tax forms 2012 55). Federal income tax forms 2012 Coal production. Federal income tax forms 2012   Coal is produced from surface mines if all geological matter (trees, earth, rock) above the coal is removed before the coal is mined. Federal income tax forms 2012 Treat coal removed by auger and coal reclaimed from coal waste refuse piles as produced from a surface mine. Federal income tax forms 2012   Treat coal as produced from an underground mine when the coal is not produced from a surface mine. Federal income tax forms 2012 In some cases, a single mine may yield coal from both surface mining and underground mining. Federal income tax forms 2012 Determine if the coal is from a surface mine or an underground mine for each ton of coal produced and not on a mine-by-mine basis. Federal income tax forms 2012 Determining tonnage or selling price. Federal income tax forms 2012   The producer pays the tax on coal at the time of sale or use. Federal income tax forms 2012 In figuring the selling price for applying the tax, the point of sale is f. Federal income tax forms 2012 o. Federal income tax forms 2012 b. Federal income tax forms 2012 (free on board) mine or f. Federal income tax forms 2012 o. Federal income tax forms 2012 b. Federal income tax forms 2012 cleaning plant if you clean the coal before selling it. Federal income tax forms 2012 This applies even if you sell the coal for a delivered price. Federal income tax forms 2012 The f. Federal income tax forms 2012 o. Federal income tax forms 2012 b. Federal income tax forms 2012 mine or f. Federal income tax forms 2012 o. Federal income tax forms 2012 b. Federal income tax forms 2012 cleaning plant is the point at which you figure the number of tons sold for applying the applicable tonnage rate, and the point at which you figure the sale price for applying the 4. Federal income tax forms 2012 4% rate. Federal income tax forms 2012   The tax applies to the full amount of coal sold. Federal income tax forms 2012 However, the IRS allows a calculated reduction of the taxable weight of the coal for the weight of the moisture in excess of the coal's inherent moisture content. Federal income tax forms 2012 Include in the sale price any additional charge for a freeze-conditioning additive in figuring the tax. Federal income tax forms 2012   Do not include in the sales price the excise tax imposed on coal. Federal income tax forms 2012 Coal used by the producer. Federal income tax forms 2012   The tax on coal applies if the coal is used by the producer in other than a mining process. Federal income tax forms 2012 A mining process means the same for this purpose as for percentage depletion. Federal income tax forms 2012 For example, the tax does not apply if, before selling the coal, you break it, clean it, size it, or apply any other process considered mining under the rules for depletion. Federal income tax forms 2012 In this case, the tax applies only when you sell the coal. Federal income tax forms 2012 The tax does not apply to coal used as fuel in the coal drying process since it is considered to be used in a mining process. Federal income tax forms 2012 However, the tax does apply when you use the coal as fuel or as an ingredient in making coke since the coal is not used in a mining process. Federal income tax forms 2012   You must use a constructive sale price to figure the tax under the 4. Federal income tax forms 2012 4% rate if you use the coal in other than a mining process. Federal income tax forms 2012 Base your constructive sale price on sales of a like kind and grade of coal by you or other producers made f. Federal income tax forms 2012 o. Federal income tax forms 2012 b. Federal income tax forms 2012 mine or cleaning plant. Federal income tax forms 2012 Normally, you use the same constructive price used to figure your percentage depletion deduction. Federal income tax forms 2012 Blending. Federal income tax forms 2012   If you blend surface-mined coal with underground-mined coal during the cleaning process, you must figure the excise tax on the sale of the blended, cleaned coal. Federal income tax forms 2012 Figure the tax separately for each type of coal in the blend. Federal income tax forms 2012 Base the tax on the amount of each type in the blend if you can determine the proportion of each type of coal contained in the final blend. Federal income tax forms 2012 Base the tax on the ratio of each type originally put into the cleaning process if you cannot determine the proportion of each type of coal in the blend. Federal income tax forms 2012 However, the tax is limited to 4. Federal income tax forms 2012 4% of the sale price per ton of the blended coal. Federal income tax forms 2012 Exemption from tax. Federal income tax forms 2012   The tax does not apply to sales of lignite and imported coal. Federal income tax forms 2012 The only other exemption from the tax on the sale of coal is for coal exported as discussed next. Federal income tax forms 2012 Exported. Federal income tax forms 2012   The tax does not apply to the sale of coal if the coal is in the stream of export when sold by the producer and the coal is actually exported. Federal income tax forms 2012   Coal is in the stream of export when sold by the producer if the sale is a step in the exportation of the coal to its ultimate destination in a foreign country. Federal income tax forms 2012 For example, coal is in the stream of export when: The coal is loaded on an export vessel and title is transferred from the producer to a foreign purchaser, or The producer sells the coal to an export broker in the United States under terms of a contract showing that the coal is to be shipped to a foreign country. Federal income tax forms 2012   Proof of export includes any of the following items. Federal income tax forms 2012 A copy of the export bill of lading issued by the delivering carrier. Federal income tax forms 2012 A certificate signed by the export carrier's agent or representative showing actual exportation of the coal. Federal income tax forms 2012 A certificate of landing signed by a customs officer of the foreign country to which the coal is exported. Federal income tax forms 2012 If the foreign country does not have a customs administrator, a statement of the foreign consignee showing receipt of the coal. Federal income tax forms 2012 Taxable Tires Taxable tires are divided into three categories for reporting and figuring the tax as described below. Federal income tax forms 2012 A tax is imposed on taxable tires sold by the manufacturer, producer, or importer at the rate of $. Federal income tax forms 2012 0945 ($. Federal income tax forms 2012 04725 in the case of a biasply tire or super single tire) for each 10 pounds of the maximum rated load capacity over 3,500 pounds. Federal income tax forms 2012 The three categories for reporting the tax and the tax rate are listed below. Federal income tax forms 2012 Taxable tires other than biasply or super single tires at $. Federal income tax forms 2012 0945. Federal income tax forms 2012 Taxable tires, biasply or super single tires (other than super single tires designed for steering) at $. Federal income tax forms 2012 04725. Federal income tax forms 2012 Taxable tires, super single tires designed for steering at $. Federal income tax forms 2012 0945. Federal income tax forms 2012 A taxable tire is any tire of the type used on highway vehicles if wholly or partially made of rubber and if marked according to federal regulations for highway use. Federal income tax forms 2012 A biasply tire is a pneumatic tire on which the ply cords that extend to the beads are laid at alternate angles substantially less than 90 degrees to the centerline of the tread. Federal income tax forms 2012 A super single tire is a tire greater than 13 inches in cross section width designed to replace 2 tires in a dual fitment. Federal income tax forms 2012 Special rule, manufacturer's retail stores. Federal income tax forms 2012   The excise tax on taxable tires is imposed at the time the taxable tires are delivered to the manufacturer-owned retail stores, not at the time of sale. Federal income tax forms 2012 Tires on imported articles. Federal income tax forms 2012   The importer of an article equipped with taxable tires is treated as the manufacturer of the tires and is liable for the taxable tire excise tax when the article is sold (except in the case of an automobile bus chassis or body with tires). Federal income tax forms 2012 Tires exempt from tax. Federal income tax forms 2012   The tax on taxable tires does not apply to the following items. Federal income tax forms 2012 Domestically recapped or retreaded tires if the tires have been sold previously in the United States and were taxable tires at the time of sale. Federal income tax forms 2012 Tire carcasses not suitable for commercial use. Federal income tax forms 2012 Tires for use on qualifying intercity, local, and school buses. Federal income tax forms 2012 For tax-free treatment, the registration requirements discussed earlier under Requirements for Exempt Sales apply. Federal income tax forms 2012 Tires sold for the exclusive use of the Department of Defense or the Coast Guard. Federal income tax forms 2012 Tires of a type used exclusively on mobile machinery. Federal income tax forms 2012 A taxable tire used on mobile machinery is not exempt from tax. Federal income tax forms 2012 Qualifying intercity or local bus. Federal income tax forms 2012   This is any bus used mainly (more than 50%) to transport the general public for a fee and that either operates on a schedule along regular routes or seats at least 20 adults (excluding the driver). Federal income tax forms 2012 Qualifying school bus. Federal income tax forms 2012   This is any bus substantially all the use (85% or more) of which is to transport students and employees of schools. Federal income tax forms 2012 Credit or refund. Federal income tax forms 2012   A credit or refund (without interest) is allowable on tax-paid tires if the tires have been: Exported; Sold to a state or local government for its exclusive use; Sold to a nonprofit educational organization for its exclusive use (as defined under Communications Tax in chapter 4); Sold to a qualified blood collector organization (as defined under Communications Tax in chapter 4) for its exclusive use in connection with a vehicle the organization certifies will be primarily used in the collection, storage, or transportation of blood; Used or sold for use as supplies for vessels; or Sold in connection with qualified intercity, local, or school buses. Federal income tax forms 2012   Also, a credit or refund (without interest) is allowable on tax-paid tires sold by any person on, or in connection with, any other article that is sold or used in an activity listed above. Federal income tax forms 2012   The person who paid the tax is eligible to make the claim. Federal income tax forms 2012 Gas Guzzler Tax Tax is imposed on the sale by the manufacturer of automobiles of a model type that has a fuel economy standard as measured by the Environmental Protection Agency (EPA) of less than 22. Federal income tax forms 2012 5 miles per gallon. Federal income tax forms 2012 If you import an automobile for personal use, you may be liable for this tax. Federal income tax forms 2012 Figure the tax on Form 6197, as discussed later. Federal income tax forms 2012 The tax rate is based on fuel economy rating. Federal income tax forms 2012 The tax rates for the gas guzzler tax are shown on Form 6197. Federal income tax forms 2012 A person that lengthens an existing automobile is the manufacturer of an automobile. Federal income tax forms 2012 Automobiles. Federal income tax forms 2012   An automobile (including limousines) means any four-wheeled vehicle that is: Rated at an unloaded gross vehicle weight of 6,000 pounds or less, Propelled by an engine powered by gasoline or diesel fuel, and Intended for use mainly on public streets, roads, and highways. Federal income tax forms 2012 Vehicles not subject to tax. Federal income tax forms 2012   For the gas guzzler tax, the following vehicles are not considered automobiles. Federal income tax forms 2012 Limousines with a gross unloaded vehicle weight of more than 6,000 pounds. Federal income tax forms 2012 Vehicles operated exclusively on a rail or rails. Federal income tax forms 2012 Vehicles sold for use and used primarily: As ambulances or combination ambulance-hearses, For police or other law enforcement purposes by federal, state, or local governments, or For firefighting purposes. Federal income tax forms 2012 Vehicles treated under 49 U. Federal income tax forms 2012 S. Federal income tax forms 2012 C. Federal income tax forms 2012 32901 (1978) as non-passenger automobiles. Federal income tax forms 2012 This includes limousines manufactured primarily to transport more than 10 persons. Federal income tax forms 2012   The manufacturer can sell a vehicle described in item (3) tax free only when the sale is made directly to a purchaser for the described emergency use and the manufacturer and purchaser (other than a state or local government) are registered. Federal income tax forms 2012   Treat an Indian tribal government as a state only if the police or other law enforcement purposes are an essential tribal government function. Federal income tax forms 2012 Model type. Federal income tax forms 2012   Model type is a particular class of automobile as determined by EPA regulations. Federal income tax forms 2012 Fuel economy. Federal income tax forms 2012   Fuel economy is the average number of miles an automobile travels on a gallon of gasoline (or diesel fuel) rounded to the nearest 0. Federal income tax forms 2012 1 mile as figured by the EPA. Federal income tax forms 2012 Imported automobiles. Federal income tax forms 2012   The tax also applies to automobiles that do not have a prototype-based fuel economy rating assigned by the EPA. Federal income tax forms 2012 An automobile imported into the United States without a certificate of conformity to United States emission standards and that has no assigned fuel economy rating must be either: Converted by installation of emission controls to conform in all material respects to an automobile already certified for sale in the United States, or Modified by installation of emission control components and individually tested to demonstrate emission compliance. Federal income tax forms 2012   An imported automobile that has been converted to conform to an automobile already certified for sale in the United States may use the fuel economy rating assigned to that certified automobile. Federal income tax forms 2012   A fuel economy rating is not generally available for modified imported automobiles because the EPA does not require a highway fuel economy test on them. Federal income tax forms 2012 A separate highway fuel economy test would be required to devise a fuel economy rating (otherwise the automobile is presumed to fall within the lowest fuel economy rating category). Federal income tax forms 2012   For more information about fuel economy ratings for imported automobiles, see Revenue Ruling 86-20 and Revenue Procedure 86-9 in Cumulative Bulletin 1986-1, and Revenue Procedure 87-10 in Cumulative Bulletin 1987-1. Federal income tax forms 2012 Exemptions. Federal income tax forms 2012   No one is exempt from the gas guzzler tax, including the federal government, state and local governments, qualified blood collector organizations, and nonprofit educational organizations. Federal income tax forms 2012 However, see Vehicles not subject to tax, earlier. Federal income tax forms 2012 Form 6197. Federal income tax forms 2012   Use Form 6197 to figure your tax liability for each quarter. Federal income tax forms 2012 Attach Form 6197 to your Form 720 for the quarter. Federal income tax forms 2012 See the Form 6197 instructions for more information and the one-time filing rules. Federal income tax forms 2012 Credit or refund. Federal income tax forms 2012   If the manufacturer paid the tax on a vehicle that is used or resold for an emergency use (see item (3) under Vehicles not subject to tax), the manufacturer can claim a credit or refund. Federal income tax forms 2012 For information about how to file for credits or refunds, see the Instructions for Form 720 or Form 8849. Federal income tax forms 2012 Vaccines Tax is imposed on certain vaccines sold by the manufacturer in the United States. Federal income tax forms 2012 A taxable vaccine means any of the following vaccines. Federal income tax forms 2012 Any vaccine containing diphtheria toxoid. Federal income tax forms 2012 Any vaccine containing tetanus toxoid. Federal income tax forms 2012 Any vaccine containing pertussis bacteria, extracted or partial cell bacteria, or specific pertussis antigens. Federal income tax forms 2012 Any vaccine containing polio virus. Federal income tax forms 2012 Any vaccine against measles. Federal income tax forms 2012 Any vaccine against mumps. Federal income tax forms 2012 Any vaccine against rubella. Federal income tax forms 2012 Any vaccine against hepatitis A. Federal income tax forms 2012 Any vaccine against hepatitis B. Federal income tax forms 2012 Any vaccine against chicken pox. Federal income tax forms 2012 Any vaccine against rotavirus gastroenteritis. Federal income tax forms 2012 Any HIB vaccine. Federal income tax forms 2012 Any conjugate vaccine against streptococcus pneumoniae. Federal income tax forms 2012 Any trivalent vaccine against influenza or any other vaccine against influenza. Federal income tax forms 2012 Any meningococcal vaccine. Federal income tax forms 2012 Any vaccine against the human papillomavirus. Federal income tax forms 2012 The effective date for the tax on any vaccine against influenza, other than trivalent influenza vaccines, is the later of August 1, 2013, or the date the Secretary of Health and Human Services lists a vaccine against seasonal influenza for purposes of compensation for any vaccine-related injury or death through the Vaccine Injury Compensation Trust Fund. Federal income tax forms 2012 The tax is $. Federal income tax forms 2012 75 per dose of each taxable vaccine. Federal income tax forms 2012 The tax per dose on a vaccine that contains more than one taxable vaccine is $. Federal income tax forms 2012 75 times the number of taxable vaccines. Federal income tax forms 2012 Taxable use. Federal income tax forms 2012   Any manufacturer (including a governmental entity) that uses a taxable vaccine before it is sold will be liable for the tax in the same manner as if the vaccine was sold by the manufacturer. Federal income tax forms 2012 Credit or refund. Federal income tax forms 2012   A credit or refund (without interest) is available if the vaccine is: Returned to the person who paid the tax (other than for resale), or Destroyed. Federal income tax forms 2012 The claim for a credit or refund must be filed within 6 months after the vaccine is returned or destroyed. Federal income tax forms 2012 Conditions to allowance. Federal income tax forms 2012   To claim a credit or refund, the person who paid the tax must have repaid or agreed to repay the tax to the ultimate purchaser of the vaccine or obtained the written consent of such purchaser to allowance of the credit or refund. Federal income tax forms 2012 Taxable Medical Devices Taxable medical devices. Federal income tax forms 2012   The tax on the sale of certain medical devices by the manufacturer, producer, or importer of the device is 2. Federal income tax forms 2012 3% (. Federal income tax forms 2012 023) of the sales price. Federal income tax forms 2012 A taxable medical device is a device that is listed as a device with the Food and Drug Administration (FDA) under section 510(j) of the Federal Food, Drug, and Cosmetic Act and 21 CFR part 807, pursuant to FDA requirements. Federal income tax forms 2012 There are specific exemptions for eyeglasses, contact lenses, and hearing aids. Federal income tax forms 2012 There is also an exemption for devices that are determined by the Secretary to be of a type that are generally purchased by the general public at retail for individual use (this exemption is known as the retail exemption). Federal income tax forms 2012 See T. Federal income tax forms 2012 D. Federal income tax forms 2012 9604 for information on how to determine whether a device falls within the retail exemption, and examples of how a taxpayer might evaluate a given device. Federal income tax forms 2012 More information. Federal income tax forms 2012   For more information on the medical device tax, see section 4191, T. Federal income tax forms 2012 D. Federal income tax forms 2012 9604, and Notice 2012-77. Federal income tax forms 2012 You can find T. Federal income tax forms 2012 D. Federal income tax forms 2012 9604 and Notice 2012-77 on pages 730 and 781, respectively, of I. Federal income tax forms 2012 R. Federal income tax forms 2012 B. Federal income tax forms 2012 2012-52 at www. Federal income tax forms 2012 irs. Federal income tax forms 2012 gov/pub/irs-irbs/irb12-52. Federal income tax forms 2012 pdf. Federal income tax forms 2012 Prev  Up  Next   Home   More Online Publications