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Free 1040

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Free 1040

Free 1040 Publication 3920 - Main Contents Table of Contents Tax ForgivenessYears Eligible for Tax Forgiveness Amount of Tax Forgiven Refund of Taxes Paid How To Claim Tax Forgiveness Payments to SurvivorsSeptember 11th Victim Compensation Fund of 2001 Qualified Disaster Relief Payments Disability Payments Death Benefits Canceled Debt Payments to Survivors of Public Safety Officers Postponed Tax DeadlinesCovered area. Free 1040 Disaster Area Losses Estate Tax Reduction Structured Settlement Factoring Transactions Illustrated Worksheets B and C Additional Worksheets How To Get Tax Help Tax Forgiveness The IRS will forgive the federal income tax liabilities of decedents who died as a result of the Oklahoma City attack, September 11 attacks, and anthrax attacks. Free 1040 Income tax is forgiven for these decedents whether they were killed in an attack or in rescue or recovery operations. Free 1040 Any forgiven tax liability owed to the IRS will not have to be paid. Free 1040 Any forgiven tax liability that has already been paid will be refunded. Free 1040 (See Refund of Taxes Paid, later. Free 1040 ) To determine the amount of tax to be forgiven, read Years Eligible for Tax Forgiveness first. Free 1040 Then read Amount of Tax Forgiven. Free 1040 Decedents whose total forgiven tax liability for all eligible years is less than $10,000 are entitled to $10,000 minimum relief. Free 1040 Even decedents who were not required to file tax returns for the eligible tax years are entitled to $10,000 minimum relief. Free 1040 See Minimum Amount of Relief later under Amount of Tax Forgiven. Free 1040 Years Eligible for Tax Forgiveness The following paragraphs explain which years are eligible for tax forgiveness. Free 1040 Oklahoma City attack. Free 1040   For those who died from this attack, income tax is forgiven for 1994 and all later years up to and including the year of death. Free 1040 Example 1. Free 1040 A man was killed in the bombing of the federal building in Oklahoma City on April 19, 1995. Free 1040 His income tax is forgiven for 1994 and 1995. Free 1040 Example 2. Free 1040 A woman was wounded while walking outside the federal building in Oklahoma City on April 19, 1995. Free 1040 She subsequently died of her wounds in 1996. Free 1040 Her income tax is forgiven for 1994, 1995, and 1996. Free 1040 September 11 attacks and anthrax attacks. Free 1040   For those who die from these attacks, income tax is forgiven for 2000 and all later years up to and including the year of death. Free 1040 Example 1. Free 1040 A Pentagon employee died in the September 11 attack. Free 1040 Her income tax is forgiven for 2000 and 2001. Free 1040 Example 2. Free 1040 A visitor to the World Trade Center died in 2002 of wounds he sustained in the September 11 attack. Free 1040 His income tax liability is forgiven for 2000, 2001, and 2002. Free 1040 Amount of Tax Forgiven The IRS will forgive the decedent's income tax liability for all years eligible for tax forgiveness. Free 1040 On a joint return, only the decedent's part of the joint income tax liability is eligible for forgiveness. Free 1040 To figure the tax to be forgiven, use the following worksheets. Free 1040 Use Worksheet A for any eligible year the decedent filed a return as single, married filing separately, head of household, or qualifying widow(er). Free 1040 Use Worksheet B for any eligible year the decedent filed a joint return. Free 1040 See the illustrated Worksheet B near the end of this publication. Free 1040 Do not complete Worksheet A or B if the decedent was not required to file tax returns for the eligible tax years. Free 1040 Instead, complete Worksheet C and file a return for the decedent's last tax year. Free 1040 See Minimum Amount of Relief, later. Free 1040 If you need assistance, call the IRS at 1–866–562–5227 Monday through Friday during the following times. Free 1040 In English–7 a. Free 1040 m. Free 1040 to 10 p. Free 1040 m. Free 1040 local time. Free 1040 In Spanish–8 a. Free 1040 m. Free 1040 to 9:30 p. Free 1040 m. Free 1040 local time. Free 1040 Both spouses died. Free 1040   If both spouses died as a result of a terrorist attack and they filed a joint return for an eligible tax year, fill out Worksheet B for each spouse for that year. Free 1040 Do this to determine if each spouse qualifies for the minimum relief of $10,000 (discussed later under Minimum Amount of Relief). Free 1040 If you are certain that neither spouse's total forgiven tax liability for all eligible years is less than $10,000, skip Worksheet B. Free 1040 However, attach a computation of the forgiven tax liability to the final income tax return or amended tax return for each eligible year. Free 1040 The forgiven tax liability is the total tax shown on the joint return minus the taxes listed in the instructions for line 4 of Worksheet B. Free 1040 Residents of community property states. Free 1040   If the decedent was domiciled in a community property state and the spouse reported half the community income on a separate return, the surviving spouse can get a refund of taxes paid on his or her share of the decedent's income for the eligible years. Free 1040 Also, all of the decedent's income taxes paid for the eligible years will be refunded to either the executor or administrator of the estate, or to the surviving spouse if there is no legal representative. Free 1040 Worksheet B. Free 1040 Figuring the Tax To Be Forgiven (For Decedents Who Filed a Joint Return)       (A) First Eligible Year (1994 or 2000) (B) Second Eligible Year (1995 or 2001) (C) Third Eligible Year (1996 or 2002) 1 Enter the years eligible for forgiveness. Free 1040 1       2 Enter the decedent's taxable income. Free 1040 Figure taxable income as if a separate return had been filed. Free 1040 See the instructions. Free 1040 2       3 Enter the decedent's total tax. Free 1040 See the instructions. Free 1040 3       4 Enter the total, if any, of the decedent's taxes not eligible for forgiveness. Free 1040 See the instructions. Free 1040 4       5 Subtract line 4 from line 3. Free 1040 5       6 Enter the surviving spouse's taxable income. Free 1040 Figure taxable income as if a separate return had been filed. Free 1040 See the instructions. Free 1040 6       7 Enter the surviving spouse's total tax. Free 1040 See the instructions. Free 1040 7       8 Enter the total, if any, of the surviving spouse's taxes listed in the instructions for line 4. Free 1040 8       9 Subtract line 8 from line 7. Free 1040 9       10 Add lines 5 and 9. Free 1040 10       11 Enter the total tax from the joint return. Free 1040 See Table 1 on page 5 for the line number for years before 2002. Free 1040 11       12 Add lines 4 and 8. Free 1040 12       13 Subtract line 12 from line 11. Free 1040 13       14 Divide line 5 by line 10. Free 1040 Enter the result as a decimal. Free 1040 14       15 Tax to be forgiven. Free 1040 Multiply line 13 by line 14 and enter the result. Free 1040 15       Note. Free 1040 If the total of columns (A), (B), and (C) of line 15 (including any amounts shown on line 5 of Worksheet A) is less than $10,000, also complete Worksheet C. Free 1040 Attach the computation of the tax to be forgiven or a copy of this worksheet to the decedent's final income tax return or amended tax return (Form 1040X) for each year listed on line 1. Free 1040 If filing Form 1040X for an eligible year, enter the amount from line 15 above on Form 1040X in column B of line 10 as a decrease in tax. Free 1040 The IRS will determine the amount to be refunded. Free 1040 Worksheet B. Free 1040 Figuring the Tax To Be Forgiven (For Decedents Who Filed a Joint Return)       (A) First Eligible Year (1994 or 2000) (B) Second Eligible Year (1995 or 2001) (C) Third Eligible Year (1996 or 2002) 1 Enter the years eligible for forgiveness. Free 1040 1       2 Enter the decedent's taxable income. Free 1040 Figure taxable income as if a separate return had been filed. Free 1040 See the instructions. Free 1040 2       3 Enter the decedent's total tax. Free 1040 See the instructions. Free 1040 3       4 Enter the total, if any, of the decedent's taxes not eligible for forgiveness. Free 1040 See the instructions. Free 1040 4       5 Subtract line 4 from line 3. Free 1040 5       6 Enter the surviving spouse's taxable income. Free 1040 Figure taxable income as if a separate return had been filed. Free 1040 See the instructions. Free 1040 6       7 Enter the surviving spouse's total tax. Free 1040 See the instructions. Free 1040 7       8 Enter the total, if any, of the surviving spouse's taxes listed in the instructions for line 4. Free 1040 8       9 Subtract line 8 from line 7. Free 1040 9       10 Add lines 5 and 9. Free 1040 10       11 Enter the total tax from the joint return. Free 1040 See Table 1 on page 5 for the line number for years before 2002. Free 1040 11       12 Add lines 4 and 8. Free 1040 12       13 Subtract line 12 from line 11. Free 1040 13       14 Divide line 5 by line 10. Free 1040 Enter the result as a decimal. Free 1040 14       15 Tax to be forgiven. Free 1040 Multiply line 13 by line 14 and enter the result. Free 1040 15       Note. Free 1040 If the total of columns (A), (B), and (C) of line 15 (including any amounts shown on line 5 of Worksheet A) is less than $10,000, also complete Worksheet C. Free 1040 Attach the computation of the tax to be forgiven or a copy of this worksheet to the decedent's final income tax return or amended tax return (Form 1040X) for each year listed on line 1. Free 1040 If filing Form 1040X for an eligible year, enter the amount from line 15 above on Form 1040X in column B of line 10 as a decrease in tax. Free 1040 The IRS will determine the amount to be refunded. Free 1040 Instructions for Worksheet B Table 1. Free 1040 Total Tax Line on Decedent's Return Note: Use this table to find the total tax line on the decedent's income tax return. Free 1040 * Form 1994 1995 1996 2000 2001 1040 Line 53 Line 54 Line 51 Line 57 Line 58 1040A Line 27 Line 28 Line 28 Line 35 File Form 1040 1040EZ Line 9 Line 10 Line 10 Line 10 TeleFile Tax Record ** Line E Line J Line K 1040NR Line 51 Line 52 Line 49 Line 54 Line 54 1040NR–EZ N/A Line 17 Line 17 Line 18 File Form 1040NR * Line numbers for the 2002 forms were not available when this publication went to print. Free 1040 ** File Form 4506 to get a transcript of the decedent's account. Free 1040 Table 1. Free 1040 Total Tax Line on Decedent's Return Note: Use this table to find the total tax line on the decedent's income tax return. Free 1040 * Form 1994 1995 1996 2000 2001 1040 Line 53 Line 54 Line 51 Line 57 Line 58 1040A Line 27 Line 28 Line 28 Line 35 File Form 1040 1040EZ Line 9 Line 10 Line 10 Line 10 TeleFile Tax Record ** Line E Line J Line K 1040NR Line 51 Line 52 Line 49 Line 54 Line 54 1040NR–EZ N/A Line 17 Line 17 Line 18 File Form 1040NR * Line numbers for the 2002 forms were not available when this publication went to print. Free 1040 ** File Form 4506 to get a transcript of the decedent's account. Free 1040 Lines 2 and 6. Free 1040   Allocate income and deductions in the same manner they would have been allocated if the spouses had filed separate returns. Free 1040   Allocate wages and salaries to the spouse who performed the services and received the Form W-2. Free 1040 Business and investment income (including capital gains) are generally allocated to the spouse who owned the business or investment that produced the income. Free 1040 Income from a jointly owned business or investment should be allocated equally between the spouses unless there is evidence that shows a different allocation is appropriate. Free 1040   Allocate business deductions to the owner of the business. Free 1040 Allocate personal deductions (such as itemized deductions for mortgage interest and taxes) equally between the spouses unless there is evidence that shows a different allocation is appropriate. Free 1040 Lines 3 and 7. Free 1040   Figure the total tax as if a separate return had been filed. Free 1040 The total tax is the tax that would have been entered on the tax return line shown in Table 1 if a separate return had been filed. Free 1040 When figuring the tax using the Tax Table or Tax Rate Schedule, use the “Married filing separately” column in the Tax Table or Tax Rate Schedule Y-2. Free 1040   When figuring the total tax, allocate credits and other taxes, if any, in the same manner as they would have been allocated if the spouses had filed separate returns. Free 1040 If a credit would not have been allowed on a separate return, allocate the credit shown on the joint return between the spouses. Free 1040 Examples of credits generally not allowed on a separate return are the child and dependent care credit, credit for the elderly, adoption credit, education credits, and earned income credit. Free 1040 Line 4. Free 1040   Enter the total, if any, of the following taxes. Free 1040 Self-employment tax. Free 1040 Social security and Medicare tax on tip income not reported to employer. Free 1040 Tax on excess contributions to IRAs, Coverdell education savings accounts (formerly Ed IRAs), or Archer MSAs (formerly medical savings accounts). Free 1040 Tax on excess accumulation in qualified retirement plans. Free 1040 Household employment taxes. Free 1040 Uncollected social security and Medicare or RRTA tax on tips or group-term life insurance. Free 1040 Tax on golden parachute payments. Free 1040 Minimum Amount of Relief The minimum amount of relief is $10,000. Free 1040 If the decedent's total forgiven tax liability for all eligible years is less than $10,000, the difference between $10,000 and the total forgiven tax liability for those years will be treated as a tax payment for the decedent's last tax year. Free 1040 The IRS will refund the difference as explained under Refund of Taxes Paid. Free 1040 Use Worksheet C to figure the additional tax payment. Free 1040 But first complete Worksheet A or B, unless the decedent was not required to file tax returns for the eligible tax years. Free 1040 Example 1. Free 1040 An individual who died in the September 11 attacks had an income tax liability of $-0- for 2000 and $6,400 for 2001. Free 1040 The $6,400 is eligible for forgiveness. Free 1040 The IRS will forgive $6,400 and treat the difference between $10,000 and $6,400 ($3,600) as a tax payment for 2001. Free 1040 Example 2. Free 1040 A child who died in the September 11 attacks had no (-0-) income tax liability for 2000 or 2001. Free 1040 The IRS will treat $10,000 as a tax payment for 2001. Free 1040 Income received after date of death. Free 1040   Generally, income of the decedent received after the date of death must be reported on Form 1041 if the estate has gross income for the tax year of $600 or more. Free 1040 Examples are the final paycheck or dividends on stock owned by the decedent. Free 1040 However, this income is exempt from income tax and is not included on Form 1041 if it is received: After the date of the decedent's death, and Before the end of the decedent's tax year (determined without regard to death). Free 1040 Nonqualifying income. Free 1040   The following income is not exempt from tax. Free 1040 The tax on it is not eligible for forgiveness. Free 1040 Deferred compensation that would have been payable if the death had occurred because of an event other than these attacks. Free 1040 Amounts that would not have been payable but for an action taken after September 11, 2001. Free 1040 The following are examples of nonqualifying income. Free 1040 Amounts payable from a qualified retirement plan or IRA to the beneficiary or estate of the decedent. Free 1040 Amounts payable only as death or survivor's benefits from pre-existing arrangements that would have been paid if the death had occurred for another reason. Free 1040 Income received as a result of adjustments made by the decedent's employer to a plan or arrangement to accelerate the vesting of restricted property or the payment of nonqualified deferred compensation after the date of the attack. Free 1040 Interest on savings bonds cashed by the beneficiary of the decedent. Free 1040 If you are responsible for the estate of a decedent, see Publication 559. Free 1040 Publication 559 discusses how to complete and file federal income tax returns and explains your responsibility to pay any taxes due. Free 1040 Instructions for lines 2–9 of Worksheet C. Free 1040   The tax that would have been payable on the exempt income (discussed earlier) must be considered when determining whether a decedent is entitled to the $10,000 minimum relief. Free 1040 To figure the tax that would have been payable, you can use lines 2 through 9 of Worksheet C. Free 1040 Or, if special requirements are met, you can use the alternative computation instead. Free 1040 See Alternative computation, later. Free 1040   You have to use lines 2–9 (or the alternative computation) to figure the tax that would have been payable even if Form 1041 was not required to be filed. Free 1040 Use Form 1041 to figure what the taxable income would be without including the exempt income. Free 1040 Then enter that taxable income (even if a negative number) on line 2 of Worksheet C (or line 1 of Worksheet D, Alternative Computation of Tax on Exempt Income (Line 9 of Worksheet C)). Free 1040 Alternative computation. Free 1040   Instead of using lines 2–8 of Worksheet C to figure the tax on exempt income (line 9 of Worksheet C), you may be able to use Worksheet D. Free 1040 You can use Worksheet D to figure the tax on the exempt income payable by the estate and its beneficiaries only if both of the following requirements are met. Free 1040 The estate claimed an income distribution deduction on line 18 (Form 1041). Free 1040 Each beneficiary submits the information necessary to refigure the income tax payable on the exempt income received from the decedent's estate. Free 1040 If requirement (2) is met but requirement (1) is not, you can still use Worksheet D if: Form 1041 was not required because exempt income was received, and The estate would have claimed an income distribution deduction if the exempt income were taxable. Free 1040 If you use this alternative computation, skip lines 2–8 of Worksheet C and enter the amount from line 8 of Worksheet D on line 9 of Worksheet C. Free 1040 Complete the rest of Worksheet C to determine the additional payment allowed. Free 1040 Worksheet C. Free 1040 Amount Treated as Tax Payment for Decedent's Last Tax Year Caution: The decedent is entitled to minimum relief of $10,000. Free 1040 Complete this worksheet only if the total tax forgiven for all eligible years is less than $10,000. Free 1040 1 Minimum relief amount. Free 1040 Note: Before completing lines 2–9, see Instructions for lines 2–9 of Worksheet C. Free 1040 1 $10,000 2 Enter the taxable income from line 22 (Form 1041) 2       3 Enter the distribution deduction from line 18 (Form 1041) . Free 1040 3       4 Add lines 2 and 3. Free 1040 4       5 Enter exempt income received after death minus expenses allocable to exempt income. Free 1040 (See Income received after date of death on page 5. Free 1040 ) 5       6 Add lines 4 and 5. Free 1040 6       7 Figure the tax on line 6 using Schedule G (Form 1041). Free 1040 7       8 Figure the tax on line 4 using Schedule G (Form 1041). Free 1040 8       9 Tax on exempt income. Free 1040 Subtract line 8 from line 7. Free 1040 9       10 Enter the total of columns (A)–(C) from line 5 of Worksheet A or line 15 of Worksheet B. Free 1040 If the decedent was not required to file tax returns for the eligible tax years, enter -0-. Free 1040 10       11 Add lines 9 and 10. Free 1040 11   12 Additional payment allowed. Free 1040 If line 11 is $10,000 or more, enter -0- and stop here. Free 1040 No additional amount is allowed as a tax payment. Free 1040 Otherwise, subtract line 11 from line 1 and enter the result. Free 1040 12   Note. Free 1040 The amount on line 12 is allowed as a tax payment for the decedent's last tax year (usually 1995 or 2001). Free 1040 Attach the computation of the additional payment allowed or a copy of this worksheet to the original or amended income tax return for the decedent's last tax year. Free 1040 If filing Form 1040, include the amount from line 12 above on the “Other payments” line of the form. Free 1040 Write "Sec. Free 1040 692(d)(2) Payment" and the amount to the right of the entry space. Free 1040 Also indicate whether a Form 1041 is being filed for the decedent's estate. Free 1040 If filing Form 1040X, include the amount from line 12 above on Form 1040X on line 15, columns (B) and (C). Free 1040 Write “Sec. Free 1040 692(d)(2) Payment” on the dotted line to the left of the entry space. Free 1040 Worksheet C. Free 1040 Amount Treated as Tax Payment for Decedent's Last Tax Year Caution: The decedent is entitled to minimum relief of $10,000. Free 1040 Complete this worksheet only if the total tax forgiven for all eligible years is less than $10,000. Free 1040 1 Minimum relief amount. Free 1040 Note: Before completing lines 2–9, see Instructions for lines 2–9 of Worksheet C. Free 1040 1 $10,000 2 Enter the taxable income from line 22 (Form 1041) 2       3 Enter the distribution deduction from line 18 (Form 1041) . Free 1040 3       4 Add lines 2 and 3. Free 1040 4       5 Enter exempt income received after death minus expenses allocable to exempt income. Free 1040 (See Income received after date of death on page 5. Free 1040 ) 5       6 Add lines 4 and 5. Free 1040 6       7 Figure the tax on line 6 using Schedule G (Form 1041). Free 1040 7       8 Figure the tax on line 4 using Schedule G (Form 1041). Free 1040 8       9 Tax on exempt income. Free 1040 Subtract line 8 from line 7. Free 1040 9       10 Enter the total of columns (A)–(C) from line 5 of Worksheet A or line 15 of Worksheet B. Free 1040 If the decedent was not required to file tax returns for the eligible tax years, enter -0-. Free 1040 10       11 Add lines 9 and 10. Free 1040 11   12 Additional payment allowed. Free 1040 If line 11 is $10,000 or more, enter -0- and stop here. Free 1040 No additional amount is allowed as a tax payment. Free 1040 Otherwise, subtract line 11 from line 1 and enter the result. Free 1040 12   Note. Free 1040 The amount on line 12 is allowed as a tax payment for the decedent's last tax year (usually 1995 or 2001). Free 1040 Attach the computation of the additional payment allowed or a copy of this worksheet to the original or amended income tax return for the decedent's last tax year. Free 1040 If filing Form 1040, include the amount from line 12 above on the “Other payments” line of the form. Free 1040 Write "Sec. Free 1040 692(d)(2) Payment" and the amount to the right of the entry space. Free 1040 Also indicate whether a Form 1041 is being filed for the decedent's estate. Free 1040 If filing Form 1040X, include the amount from line 12 above on Form 1040X on line 15, columns (B) and (C). Free 1040 Write “Sec. Free 1040 692(d)(2) Payment” on the dotted line to the left of the entry space. Free 1040 Worksheet D. Free 1040 Alternative Computation of Tax on Exempt Income (Line 9 of Worksheet C) 1 Enter the taxable income from line 22 (Form 1041) 1   2 Enter exempt income received after death minus expenses allocable to exempt income. Free 1040 (See Income received after date of death on page 5. Free 1040 ) 2   3 Add lines 1 and 2 3   4 Figure the tax on line 3 using Schedule G (Form 1041). Free 1040 4   5 Figure the tax on line 1 using Schedule G (Form 1041). Free 1040 5   6 Estate's tax on exempt income. Free 1040 Subtract line 5 from line 4 6   7 Beneficiaries' tax on exempt income. Free 1040 Figure the total tax that would have been payable by all beneficiaries. Free 1040 Do this by including in each beneficiary's gross income the exempt income received from the decedent's estate and refiguring the income tax. Free 1040 Add the amounts by which each beneficiary's income tax is increased. Free 1040 7   8 Add lines 6 and 7. Free 1040 Enter this amount on line 9 of Worksheet C. Free 1040 8   Worksheet D. Free 1040 Alternative Computation of Tax on Exempt Income (Line 9 of Worksheet C) 1 Enter the taxable income from line 22 (Form 1041) 1   2 Enter exempt income received after death minus expenses allocable to exempt income. Free 1040 (See Income received after date of death on page 5. Free 1040 ) 2   3 Add lines 1 and 2 3   4 Figure the tax on line 3 using Schedule G (Form 1041). Free 1040 4   5 Figure the tax on line 1 using Schedule G (Form 1041). Free 1040 5   6 Estate's tax on exempt income. Free 1040 Subtract line 5 from line 4 6   7 Beneficiaries' tax on exempt income. Free 1040 Figure the total tax that would have been payable by all beneficiaries. Free 1040 Do this by including in each beneficiary's gross income the exempt income received from the decedent's estate and refiguring the income tax. Free 1040 Add the amounts by which each beneficiary's income tax is increased. Free 1040 7   8 Add lines 6 and 7. Free 1040 Enter this amount on line 9 of Worksheet C. Free 1040 8   Refund of Taxes Paid The IRS will refund the following forgiven income tax liabilities. Free 1040 Income tax liabilities that have been paid. Free 1040 Income tax liabilities treated as paid because the total tax liability for all years eligible for tax forgiveness is less than $10,000. Free 1040 See Minimum Amount of Relief, earlier. Free 1040 Example 1. Free 1040 A man who died in the September 11 attacks had an income tax liability of $7,500 for 2000 and $6,500 for 2001. Free 1040 The total, $14,000, is eligible for tax forgiveness. Free 1040 However, he paid only $13,000 of that amount. Free 1040 The IRS will refund the $13,000 paid. Free 1040 Example 2. Free 1040 A child who died in the September 11 attacks had no income tax liability for 2000 or 2001. Free 1040 The child qualifies for the minimum relief of $10,000. Free 1040 The $10,000 is treated as a tax payment for 2001 and will be refunded. Free 1040 Period for filing a claim for credit or refund. Free 1040   To obtain a tax refund on a previously filed income tax return, file an amended return (Form 1040X or an amended Form 1041) within 3 years from the time the return was filed or 2 years from the time the tax was paid, whichever is later. Free 1040 For example, you have until April 15, 2004, to file an amended return on a 2000 Form 1040, 1040A, or 1040EZ that was filed by April 16, 2001, and for which the tax was paid when due. Free 1040 To obtain a refund on a return that has not been filed, file the return within 3 years of the original due date of the return. Free 1040 Extension of time for victims of Oklahoma City attack. Free 1040   The period described above has been extended for victims of the Oklahoma City attack. Free 1040 Survivors and personal representatives of these victims have until January 22, 2003, to file an original or amended return. Free 1040 How To Claim Tax Forgiveness Use the following procedures to claim income tax forgiveness. Free 1040 Which Form To Use The form you use depends on whether an income tax return for the eligible year was already filed for the decedent. Free 1040 Return required but not yet filed. Free 1040   File Form 1040 if the decedent was a U. Free 1040 S. Free 1040 citizen or resident. Free 1040 File Form 1040NR if the decedent was a nonresident alien. Free 1040 A nonresident alien is someone who is not a U. Free 1040 S. Free 1040 citizen or resident. Free 1040 Return required and already filed. Free 1040   File a separate Form 1040X for each year you are claiming tax relief. Free 1040 Return not required and not filed. Free 1040   File Form 1040 only for the year of death if the decedent was a U. Free 1040 S. Free 1040 citizen or resident. Free 1040 File Form 1040NR if the decedent was a nonresident alien. Free 1040 Return not required but already filed. Free 1040   File Form 1040X only for the year of death. Free 1040 How to complete the returns. Free 1040   Fill out Form 1040 or 1040NR according to its instructions but do not reduce the decedent's tax liability by any taxes that will be forgiven. Free 1040 Attach to each return a computation of the income tax to be forgiven or a copy of Worksheet A or B. Free 1040 If filing Form 1040 or Form 1040NR, also attach any Forms W–2. Free 1040 If the total forgiven tax liability for all eligible years is less than $10,000, attach to the decedent's final return a computation of the additional tax payment allowed or a copy of Worksheet C. Free 1040 Also, please write one of the following across the top of page 1 of each return. Free 1040 KITA—Oklahoma City KITA—9/11 KITA—Anthrax “KITA” means “killed in terrorist attack. Free 1040 ” Need a copy of a previously filed return?   You will find it easier to prepare Form 1040X if you have a copy of the decedent's previously filed tax return. Free 1040 If you need a copy, use Form 4506. Free 1040 The IRS will provide a free copy of the tax return if you write “DISASTER” in the top margin of Form 4506. Free 1040 Attach Letters Testamentary or other evidence to establish that you are authorized to act for the decedent's estate. Free 1040 Send Form 4506 to the address shown in the form instructions. Free 1040 Taxpayer identification number. Free 1040   A taxpayer identification number must be furnished on the decedent's returns. Free 1040 This is usually the decedent's social security number (SSN). Free 1040 However, a nonresident alien who is not eligible to get an SSN should have an individual taxpayer identification number (ITIN). Free 1040 If the decedent was a nonresident alien, had neither an SSN nor an ITIN, and was not required to file a U. Free 1040 S. Free 1040 income tax return for any tax year, do not apply for an ITIN. Free 1040 You may claim a refund by filing Form 1040NR without an SSN or ITIN. Free 1040 Necessary Documents Please attach the following documents to the return or amended return. Free 1040 Proof of death. Free 1040   Attach a copy of the death certificate. Free 1040 If the Department of Defense issued DD Form 1300, Report of Casualty, you can attach that form instead of the death certificate. Free 1040 Form 1310. Free 1040   You must send Form 1310 with all returns and claims for refund, unless either of the following applies. Free 1040 You are a surviving spouse filing an original or amended joint return with the decedent. Free 1040 You are a personal representative filing an original Form 1040 or Form 1040NR for the decedent and a court certificate showing your appointment is attached to the return. Free 1040 A personal representative is an executor or administrator of a decedent's estate, as certified or appointed by the court. Free 1040 A copy of the decedent's will cannot be accepted as evidence that you are the personal representative. Free 1040      If you have proof of death but do not have enough tax information to file a timely claim for a refund, file Form 1040X with Form 1310. Free 1040 Include a statement saying an amended return will be filed as soon as the necessary tax information is available. Free 1040 Where To File The IRS has set up a special office for processing returns and claims for tax forgiveness. Free 1040 Use one of the addresses shown below. Free 1040 Where you file the returns or claims depends on whether you use the U. Free 1040 S. Free 1040 Postal Service or a private delivery service. Free 1040 Please do not send these returns or claims to any of the addresses shown in the tax form instructions. Free 1040 U. Free 1040 S. Free 1040 Postal Service. Free 1040   If you use the U. Free 1040 S. Free 1040 Postal Service, file these returns and claims at the following address. Free 1040 Internal Revenue Service P. Free 1040 O. Free 1040 Box 4053 Woburn, MA 01888 Private delivery service. Free 1040   Private delivery services cannot deliver items to P. Free 1040 O. Free 1040 boxes. Free 1040 If you use a private delivery service, file these returns and claims at the following address. Free 1040 Internal Revenue Service Stop 661 310 Lowell St. Free 1040 Andover, MA 01810 Designated private delivery services. Free 1040   You can use the following private delivery services to file these returns and claims. Free 1040 Airborne Express (Airborne): Overnight Air Express Service, Next Afternoon Service, and Second Day Service. Free 1040 DHL Worldwide Express (DHL): DHL “Same Day” Service, and DHL USA Overnight. Free 1040 Federal Express (FedEx): FedEx Priority Overnight, FedEx Standard Overnight, and FedEx 2Day. Free 1040 United Parcel Service (UPS): UPS Next Day Air, UPS Next Day Air Saver, UPS 2nd Day Air, UPS 2nd Day Air A. Free 1040 M. Free 1040 , UPS Worldwide Express Plus, and UPS Worldwide Express. Free 1040 The private delivery service can tell you how to get written proof of the mailing date. Free 1040 Payments to Survivors The following section discusses the tax treatment of certain amounts received by survivors. Free 1040 September 11th Victim Compensation Fund of 2001 Payments from the September 11th Victim Compensation Fund of 2001 are not included in income. Free 1040 Qualified Disaster Relief Payments Qualified disaster relief payments are not included in income. Free 1040 These payments are not subject to income tax, self-employment tax, or employment taxes (social security, Medicare, and federal unemployment taxes). Free 1040 No withholding applies to these payments. Free 1040 Qualified disaster relief payments include payments you receive (regardless of the source) after September 10, 2001, for the following expenses. Free 1040 Reasonable and necessary personal, family, living, or funeral expenses incurred as a result of a terrorist attack. Free 1040 Reasonable and necessary expenses incurred for the repair or rehabilitation of a personal residence due to a terrorist attack. Free 1040 (A personal residence can be a rented residence or one you own. Free 1040 ) Reasonable and necessary expenses incurred for the repair or replacement of the contents of a personal residence due to a terrorist attack. Free 1040 Qualified disaster relief payments also include the following. Free 1040 Payments made by common carriers (for example, American Airlines and United Airlines regarding the September 11 attacks) because of death or physical injury incurred as a result of a terrorist attack. Free 1040 Amounts paid by a federal, state, or local government in connection with a terrorist attack to those affected by the attack. Free 1040 Qualified disaster relief payments do not include: Insurance or other reimbursements for expenses, or Income replacement payments, such as payments of lost wages, lost business income, or unemployment compensation. Free 1040 Disability Payments For tax years ending after September 10, 2001, disability payments for injuries incurred as a direct result of a terrorist attack directed against the United States (or its allies), whether outside or within the United States, are not included in income. Free 1040 Death Benefits Payments received by an individual or the estate of a decedent from the employer of an employee who died as a result of the Oklahoma City or September 11 terrorist attacks, or as a result of the anthrax attacks, are not included in income. Free 1040 Only the amount that exceeds the benefits that would have been payable if the death had occurred for a reason other than a terrorist or anthrax attack is excludable. Free 1040 However, the exclusion does apply to incidental death benefits paid under a qualified retirement plan even if these amounts would have been payable if the death had occurred for a reason other than a terrorist or anthrax attack. Free 1040 If you included death benefits in income on a previously filed return and they are now excludable under the above rule, file Form 1040X to amend that return. Free 1040 For information on the period for filing Form 1040X, see Period for filing claim for credit or refund earlier under Refund of Taxes Paid. Free 1040 If that period has expired, you are granted an extension. Free 1040 You have until January 22, 2003, to file Form 1040X to exclude the death benefits. Free 1040 On top of page 1 of Form 1040X, write “Extension of Limitations Under PL 107–134, sec. Free 1040 102(b)(2). Free 1040 ” Canceled Debt Canceled debt is not included in your income (or the income of the estate) if: You (or the estate) were liable, or became liable, for the debt of a decedent, and The debt was canceled after September 10, 2001, and before January 1, 2002, because the decedent died as a result of the September 11 attacks or anthrax attacks. Free 1040 The lender is not required to report the canceled debt on Form 1099–C, Cancellation of Debt. Free 1040 Payments to Survivors of Public Safety Officers If you are a survivor of a public safety officer who died in the line of duty, certain amounts you receive are not included in income. Free 1040 Bureau of Justice Assistance payments. Free 1040   If you are a surviving dependent of a public safety officer (law enforcement officer or firefighter) who died in the line of duty, do not include in your income the death benefit paid to you by the Bureau of Justice Assistance. Free 1040 Government plan annuity. Free 1040   If you receive a survivor annuity as the child or spouse (or former spouse) of a public safety officer who was killed in the line of duty, you generally do not have to include it in income. Free 1040 This exclusion applies to the amount of the annuity based on the officer's service as a public safety officer. Free 1040 For this purpose, the term public safety officer includes police and law enforcement officers, firefighters, and rescue squad and ambulance crews. Free 1040 More information. Free 1040   For more information, see Publication 559. Free 1040 Postponed Tax Deadlines The IRS may postpone for up to 1 year certain tax deadlines of taxpayers who are affected by a terrorist attack. Free 1040 The tax deadlines the IRS may postpone include those for filing income and employment tax returns, paying income and employment taxes, and making contributions to a traditional IRA or Roth IRA. Free 1040 If any tax deadline is postponed, the IRS will publicize the postponement in the affected area and publish a news release, revenue ruling, revenue procedure, notice, announcement, or other guidance in the Internal Revenue Bulletin (IRB). Free 1040 Affected taxpayers. Free 1040   If the IRS postpones a tax deadline, the following taxpayers are eligible for the postponement. Free 1040 Any individual whose main home is located in a covered area (defined later). Free 1040 Any business entity or sole proprietor whose principal place of business is located in a covered area. Free 1040 Any individual, business entity, or sole proprietor whose records needed to meet a postponed deadline are maintained in a covered area. Free 1040 The main home or principal place of business does not have to be located in the covered area. Free 1040 Any estate or trust whose tax records necessary to meet a postponed tax deadline are maintained in a covered area. Free 1040 Any individual who is a relief worker affiliated with a recognized government or philanthropic organization and who is assisting in a covered area. Free 1040 The spouse on a joint return with a taxpayer who is eligible for postponements. Free 1040 Any other person determined by the IRS to be affected by a terrorist attack. Free 1040 Covered area. Free 1040   This is an area in which a terrorist attack took place and in which the IRS has decided to postpone tax deadlines for up to 1 year. Free 1040 Abatement of interest. Free 1040   The IRS may abate (forgive) the interest on any underpaid income tax for the length of any postponement. Free 1040 Disaster Area Losses If your property was damaged or destroyed as a result of the September 11 attacks, you can choose to deduct your disaster loss on your 2000 return (or amended return) rather than on your 2001 return. Free 1040 You must make this choice to deduct your loss on your 2000 return by the later of the following dates. Free 1040 The due date (without extensions) for filing your 2001 income tax return (April 15, 2002, if you are a calendar year taxpayer). Free 1040 The due date (with extensions) for the 2000 return. Free 1040 For more information about disaster area losses, see Publication 547. Free 1040 Estate Tax Reduction The federal estate tax is reduced for taxable estates of individuals who died as a result of the Oklahoma City attack, the September 11 attacks, and the anthrax attacks. Free 1040 The estate tax is computed using a new rate schedule on page 25 of the November 2001 revision of the instructions for Form 706. Free 1040 The estate tax is reduced by credits against the estate tax, including the unified credit and the state death tax credit. Free 1040 These credits may reduce or eliminate the estate tax due. Free 1040 A special rule extends until January 22, 2003, the period of time allowed to file a claim for a refund of estate taxes that have been paid. Free 1040 Recovery from the September 11th Victim Compensation Fund. Free 1040   The value of claims for a decedent's pain and suffering is normally included in the gross estate. Free 1040 However, if the estate chooses to seek recovery from this fund, the IRS has determined that, in view of the unique circumstances of this situation and the high likelihood that such claims will be valued at a nominal or zero amount, the claims will be valued at zero for estate tax purposes. Free 1040 Thus, there are no federal estate tax consequences if an estate or beneficiary receives a recovery from this fund. Free 1040 Which estates must file a return. Free 1040   For decedents dying in 2001, Form 706 must be filed by the executor for the estate of every U. Free 1040 S. Free 1040 citizen or resident whose gross estate, plus adjusted taxable gifts and specific exemption, is more than $675,000. Free 1040 Form 706 must be filed within 9 months after the date of decedent's death unless you receive an extension of time to file. Free 1040 Use Form 4768, Application for Extension of Time To File a Return and/or Pay U. Free 1040 S. Free 1040 Estate (and Generation-Skipping Transfer) Taxes, to apply for an extension. Free 1040 Where to file. Free 1040   Returns on which the new rate schedule is used should be sent to the following address, which was not available when Form 706 went to print. Free 1040 Internal Revenue Service E & G Department/Stop 824T 201 W. Free 1040 Rivercenter Blvd. Free 1040 Covington, KY 41011 More information. Free 1040   For more information on the federal estate tax, see the instructions for Form 706. Free 1040 Structured Settlement Factoring Transactions A person who acquires payment rights in a structured settlement arrangement after February 21, 2002, may be subject to a 40% excise tax unless the transfer of the payment rights was approved in advance in a qualified order. Free 1040 The excise tax is figured on the excess of the undiscounted amount of the payments being acquired over the total amount actually paid to acquire them. Free 1040 However, this tax will not apply to transactions entered into from February 22, 2002, to July 1, 2002, if certain requirements are met. Free 1040 For information about these requirements, see Internal Revenue Code section 5891. Free 1040 Worksheet B Illustrated. Free 1040 Figuring the Tax To Be Forgiven (For Decedents Who Filed a Joint Return)       (A) First Eligible Year (1994 or 2000) (B) Second Eligible Year (1995 or 2001) (C) Third Eligible Year (1996 or 2002) 1 Enter the years eligible for forgiveness. Free 1040 1 2000 2001   2 Enter the decedent's taxable income. Free 1040 Figure taxable income as if a separate return had been filed. Free 1040 See the instructions. Free 1040 2 $17,259 $14,295   3 Enter the decedent's total tax. Free 1040 See the instructions. Free 1040 3 6,123 5,250   4 Enter the total, if any, of the decedent's taxes not eligible for forgiveness. Free 1040 See the instructions. Free 1040 4 3,532 3,109   5 Subtract line 4 from line 3. Free 1040 5 2,591 2,141   6 Enter the surviving spouse's taxable income. Free 1040 Figure taxable income as if a separate return had been filed. Free 1040 See the instructions for line 2. Free 1040 6 29,025 29,850   7 Enter the surviving spouse's total tax. Free 1040 See the instructions. Free 1040 7 5,277 5,391   8 Enter the total, if any, of the surviving spouse's taxes listed in the instructions for line 4. Free 1040 8 0 0   9 Subtract line 8 from line 7. Free 1040 9 5,277 5,391   10 Add lines 5 and 9. Free 1040 10 7,868 7,532   11 Enter the total tax from the joint return. Free 1040 See Table 1 on page 5 for the line number for years before 2002. Free 1040 11 10,789 9,728   12 Add lines 4 and 8. Free 1040 12 3,532 3,109   13 Subtract line 12 from line 11. Free 1040 13 7,257 6,619   14 Divide line 5 by line 10. Free 1040 Enter the result as a decimal. Free 1040 14 . Free 1040 329 . Free 1040 284   15 Tax to be forgiven. Free 1040 Multiply line 13 by line 14 and enter the result. Free 1040 15 $2,388 $1,880   Note. Free 1040 If the total of columns (A), (B), and (C) of line 15 (including any amounts shown on line 5 of Worksheet A) is less than $10,000, also complete Worksheet C. Free 1040 Attach the computation of the tax to be forgiven or a copy of this worksheet to the decedent's final income tax return or amended tax return (Form 1040X) for each year listed on line 1. Free 1040 If filing Form 1040X for an eligible year, enter the amount from line 15 above on Form 1040X in column B of line 10 as a decrease in tax. Free 1040 The IRS will determine the amount to be refunded. Free 1040 Worksheet B Illustrated. Free 1040 Figuring the Tax To Be Forgiven (For Decedents Who Filed a Joint Return)       (A) First Eligible Year (1994 or 2000) (B) Second Eligible Year (1995 or 2001) (C) Third Eligible Year (1996 or 2002) 1 Enter the years eligible for forgiveness. Free 1040 1 2000 2001   2 Enter the decedent's taxable income. Free 1040 Figure taxable income as if a separate return had been filed. Free 1040 See the instructions. Free 1040 2 $17,259 $14,295   3 Enter the decedent's total tax. Free 1040 See the instructions. Free 1040 3 6,123 5,250   4 Enter the total, if any, of the decedent's taxes not eligible for forgiveness. Free 1040 See the instructions. Free 1040 4 3,532 3,109   5 Subtract line 4 from line 3. Free 1040 5 2,591 2,141   6 Enter the surviving spouse's taxable income. Free 1040 Figure taxable income as if a separate return had been filed. Free 1040 See the instructions for line 2. Free 1040 6 29,025 29,850   7 Enter the surviving spouse's total tax. Free 1040 See the instructions. Free 1040 7 5,277 5,391   8 Enter the total, if any, of the surviving spouse's taxes listed in the instructions for line 4. Free 1040 8 0 0   9 Subtract line 8 from line 7. Free 1040 9 5,277 5,391   10 Add lines 5 and 9. Free 1040 10 7,868 7,532   11 Enter the total tax from the joint return. Free 1040 See Table 1 on page 5 for the line number for years before 2002. Free 1040 11 10,789 9,728   12 Add lines 4 and 8. Free 1040 12 3,532 3,109   13 Subtract line 12 from line 11. Free 1040 13 7,257 6,619   14 Divide line 5 by line 10. Free 1040 Enter the result as a decimal. Free 1040 14 . Free 1040 329 . Free 1040 284   15 Tax to be forgiven. Free 1040 Multiply line 13 by line 14 and enter the result. Free 1040 15 $2,388 $1,880   Note. Free 1040 If the total of columns (A), (B), and (C) of line 15 (including any amounts shown on line 5 of Worksheet A) is less than $10,000, also complete Worksheet C. Free 1040 Attach the computation of the tax to be forgiven or a copy of this worksheet to the decedent's final income tax return or amended tax return (Form 1040X) for each year listed on line 1. Free 1040 If filing Form 1040X for an eligible year, enter the amount from line 15 above on Form 1040X in column B of line 10 as a decrease in tax. Free 1040 The IRS will determine the amount to be refunded. Free 1040 Illustrated Worksheets B and C A wife lost her husband in the September 11 attack on the World Trade Center. Free 1040 They filed a joint return for 2000 and the wife chose to file a joint return as a surviving spouse for 2001. Free 1040 The returns for 2000 and 2001 showed the following income, deductions, and tax liabilities. Free 1040 After the husband died, his estate received income of $4,000. Free 1040 Of that amount, $1,000 is net profit from Schedule C received before the end of 2001. Free 1040 This net profit is exempt from income tax as explained earlier under Income received after date of death. Free 1040 The wife files Form 1041 because the gross income of the estate for the tax year ($3,000) is $600 or more. Free 1040 To determine how much of the husband's tax liability for 2000 and 2001 is to be forgiven, the wife completes Worksheet B. Free 1040 She also completes Worksheet C because the forgiven tax liabilities for 2000 and 2001 (line 15 of Worksheet B) total less than $10,000. Free 1040 To claim tax relief for 2000, the wife files Form 1040X and attaches a copy of Worksheet B. Free 1040 To claim tax relief for 2001, she files Form 1040 and attaches copies of Worksheets B and C. Free 1040   2000 2001 Wages (wife) $35,000 $36,000 Net profit from Schedule C, Profit or Loss From Business (husband) 25,000 22,000 Interest income (joint account) 1,000 1,100 Deduction for ½ of self-employment tax (husband) (1,766) (1,555) Standard deduction (7,350) (7,600) Personal exemptions (2) (5,600) (5,800) Taxable income $46,284 $44,145 Joint income tax liability $7,257 $6,619 Plus: Self-employment tax (husband) 3,532 3,109 Total tax liability $10,789 $9,728   2000 2001 Wages (wife) $35,000 $36,000 Net profit from Schedule C, Profit or Loss From Business (husband) 25,000 22,000 Interest income (joint account) 1,000 1,100 Deduction for ½ of self-employment tax (husband) (1,766) (1,555) Standard deduction (7,350) (7,600) Personal exemptions (2) (5,600) (5,800) Taxable income $46,284 $44,145 Joint income tax liability $7,257 $6,619 Plus: Self-employment tax (husband) 3,532 3,109 Total tax liability $10,789 $9,728 Worksheet C Illustrated. Free 1040 Amount Treated as Tax Payment for Decedent's Last Tax Year Caution: The decedent is entitled to minimum relief of $10,000. Free 1040 Complete this worksheet only if the total tax forgiven for all eligible years is less than $10,000. Free 1040 1 Minimum relief amount. Free 1040 Note: Before completing lines 2–9, see Instructions for lines 2–9 of Worksheet C. Free 1040 1 $10,000 2 Enter the taxable income from line 22 (Form 1041) 2 2,400     3 Enter the distribution deduction from line 18 (Form 1041) . Free 1040 3 0     4 Add lines 2 and 3. Free 1040 4 2,400     5 Enter exempt income received after death minus expenses allocable to exempt income. Free 1040 (See Income received after date of death on page 5. Free 1040 ) 5 1,000     6 Add lines 4 and 5. Free 1040 6 3,400     7 Figure the tax on line 6 using Schedule G (Form 1041). Free 1040 7 710     8 Figure the tax on line 4 using Schedule G (Form 1041). Free 1040 8 435     9 Tax on exempt income. Free 1040 Subtract line 8 from line 7. Free 1040 9 275     10 Enter the total of columns (A)–(C) from line 5 of Worksheet A or line 15 of Worksheet B. Free 1040 If the decedent was not required to file tax returns for the eligible tax years, enter -0-. Free 1040 10 4,268     11 Add lines 9 and 10. Free 1040 11 $4,543 12 Additional payment allowed. Free 1040 If line 11 is $10,000 or more, enter -0- and stop here. Free 1040 No additional amount is allowed as a tax payment. Free 1040 Otherwise, subtract line 11 from line 1 and enter the result. Free 1040 12 $5,457 Note. Free 1040 The amount on line 12 is allowed as a tax payment for the decedent's last tax year (usually 1995 or 2001). Free 1040 Attach the computation of the additional payment allowed or a copy of this worksheet to the original or amended income tax return for the decedent's last tax year. Free 1040 If filing Form 1040, include the amount from line 12 above on the “Other payments” line of the form. Free 1040 Write "Sec. Free 1040 692(d)(2) Payment" and the amount to the right of the entry space. Free 1040 Also indicate whether a Form 1041 is being filed for the decedent's estate. Free 1040 If filing Form 1040X, include the amount from line 12 above on Form 1040X on line 15, columns (B) and (C). Free 1040 Write “Sec. Free 1040 692(d)(2) Payment” on the dotted line to the left of the entry space. Free 1040 Worksheet C Illustrated. Free 1040 Amount Treated as Tax Payment for Decedent's Last Tax Year Caution: The decedent is entitled to minimum relief of $10,000. Free 1040 Complete this worksheet only if the total tax forgiven for all eligible years is less than $10,000. Free 1040 1 Minimum relief amount. Free 1040 Note: Before completing lines 2–9, see Instructions for lines 2–9 of Worksheet C. Free 1040 1 $10,000 2 Enter the taxable income from line 22 (Form 1041) 2 2,400     3 Enter the distribution deduction from line 18 (Form 1041) . Free 1040 3 0     4 Add lines 2 and 3. Free 1040 4 2,400     5 Enter exempt income received after death minus expenses allocable to exempt income. Free 1040 (See Income received after date of death on page 5. Free 1040 ) 5 1,000     6 Add lines 4 and 5. Free 1040 6 3,400     7 Figure the tax on line 6 using Schedule G (Form 1041). Free 1040 7 710     8 Figure the tax on line 4 using Schedule G (Form 1041). Free 1040 8 435     9 Tax on exempt income. Free 1040 Subtract line 8 from line 7. Free 1040 9 275     10 Enter the total of columns (A)–(C) from line 5 of Worksheet A or line 15 of Worksheet B. Free 1040 If the decedent was not required to file tax returns for the eligible tax years, enter -0-. Free 1040 10 4,268     11 Add lines 9 and 10. Free 1040 11 $4,543 12 Additional payment allowed. Free 1040 If line 11 is $10,000 or more, enter -0- and stop here. Free 1040 No additional amount is allowed as a tax payment. Free 1040 Otherwise, subtract line 11 from line 1 and enter the result. Free 1040 12 $5,457 Note. Free 1040 The amount on line 12 is allowed as a tax payment for the decedent's last tax year (usually 1995 or 2001). Free 1040 Attach the computation of the additional payment allowed or a copy of this worksheet to the original or amended income tax return for the decedent's last tax year. Free 1040 If filing Form 1040, include the amount from line 12 above on the “Other payments” line of the form. Free 1040 Write "Sec. Free 1040 692(d)(2) Payment" and the amount to the right of the entry space. Free 1040 Also indicate whether a Form 1041 is being filed for the decedent's estate. Free 1040 If filing Form 1040X, include the amount from line 12 above on Form 1040X on line 15, columns (B) and (C). Free 1040 Write “Sec. Free 1040 692(d)(2) Payment” on the dotted line to the left of the entry space. Free 1040 Additional Worksheets The following additional worksheets are provided for your convenience. Free 1040 Worksheet A. Free 1040 Figuring the Tax To Be Forgiven (For Decedents Who Filed a Return as Single, Married Filing Separately, Head of Household, or Qualifying Widow(er))         (A) First Eligible Year (1994 or 2000) (B) Second Eligible Year (1995 or 2001) (C) Third Eligible Year (1996 or 2002) 1 Enter the years eligible for tax forgiveness. Free 1040 1       2 Enter the total tax from the decedent's income tax return. Free 1040 See Table 1 on page 5 for the line number for years before 2002. Free 1040 2       3 Enter the following taxes, if any, shown on the decedent's income tax return. Free 1040 (These taxes are not eligible for forgiveness. Free 1040 )           a Self-employment tax. Free 1040 3a         b Social security and Medicare tax on tip income not reported to employer. Free 1040 3b         c Tax on excess contributions to IRAs, Coverdell education savings accounts (formerly Ed IRAs), or Archer MSAs (formerly medical savings accounts). Free 1040 3c         d Tax on excess accumulation in qualified retirement plans. Free 1040 3d         e Household employment taxes. Free 1040 3e         f Uncollected social security and Medicare or RRTA tax on tips or group-term life insurance. Free 1040 3f         g Tax on golden parachute payments. Free 1040 3g       4 Add lines 3a through 3g. Free 1040 4       5 Tax to be forgiven. Free 1040 Subtract line 4 from line 2. Free 1040 5       Note. Free 1040 If the total of columns (A), (B), and (C) of line 5 (including any amounts shown on line 15 of Worksheet B) is less than $10,000, also complete Worksheet C. Free 1040 Attach the computation of the tax to be forgiven or a copy of this worksheet to the decedent's final income tax return or amended tax return (Form 1040X) for each year listed on line 1. Free 1040 If filing Form 1040X for an eligible year, enter the amount from line 5 above on Form 1040X in column B of line 10 as a decrease in tax. Free 1040 The IRS will determine the amount to be refunded. Free 1040 Worksheet A. Free 1040 Figuring the Tax To Be Forgiven (For Decedents Who Filed a Return as Single, Married Filing Separately, Head of Household, or Qualifying Widow(er))         (A) First Eligible Year (1994 or 2000) (B) Second Eligible Year (1995 or 2001) (C) Third Eligible Year (1996 or 2002) 1 Enter the years eligible for tax forgiveness. Free 1040 1       2 Enter the total tax from the decedent's income tax return. Free 1040 See Table 1 on page 5 for the line number for years before 2002. Free 1040 2       3 Enter the following taxes, if any, shown on the decedent's income tax return. Free 1040 (These taxes are not eligible for forgiveness. Free 1040 )           a Self-employment tax. Free 1040 3a         b Social security and Medicare tax on tip income not reported to employer. Free 1040 3b         c Tax on excess contributions to IRAs, Coverdell education savings accounts (formerly Ed IRAs), or Archer MSAs (formerly medical savings accounts). Free 1040 3c         d Tax on excess accumulation in qualified retirement plans. Free 1040 3d         e Household employment taxes. Free 1040 3e         f Uncollected social security and Medicare or RRTA tax on tips or group-term life insurance. Free 1040 3f         g Tax on golden parachute payments. Free 1040 3g       4 Add lines 3a through 3g. Free 1040 4       5 Tax to be forgiven. Free 1040 Subtract line 4 from line 2. Free 1040 5       Note. Free 1040 If the total of columns (A), (B), and (C) of line 5 (including any amounts shown on line 15 of Worksheet B) is less than $10,000, also complete Worksheet C. Free 1040 Attach the computation of the tax to be forgiven or a copy of this worksheet to the decedent's final income tax return or amended tax return (Form 1040X) for each year listed on line 1. Free 1040 If filing Form 1040X for an eligible year, enter the amount from line 5 above on Form 1040X in column B of line 10 as a decrease in tax. Free 1040 The IRS will determine the amount to be refunded. Free 1040 Worksheet B. Free 1040 Figuring the Tax To Be Forgiven (For Decedents Who Filed a Joint Return)       (A) First Eligible Year (1994 or 2000) (B) Second Eligible Year (1995 or 2001) (C) Third Eligible Year (1996 or 2002) 1 Enter the years eligible for forgiveness. Free 1040 1       2 Enter the decedent's taxable income. Free 1040 Figure taxable income as if a separate return had been filed. Free 1040 See the instructions. Free 1040 2       3 Enter the decedent's total tax. Free 1040 See the instructions. Free 1040 3       4 Enter the total, if any, of the decedent's taxes not eligible for forgiveness. Free 1040 See the instructions. Free 1040 4       5 Subtract line 4 from line 3. Free 1040 5       6 Enter the surviving spouse's taxable income. Free 1040 Figure taxable income as if a separate return had been filed. Free 1040 See the instructions. Free 1040 6       7 Enter the surviving spouse's total tax. Free 1040 See the instructions. Free 1040 7       8 Enter the total, if any, of the surviving spouse's taxes listed in the instructions for line 4. Free 1040 8       9 Subtract line 8 from line 7. Free 1040 9       10 Add lines 5 and 9. Free 1040 10       11 Enter the total tax from the joint return. Free 1040 See Table 1 on page 5 for the line number for years before 2002. Free 1040 11       12 Add lines 4 and 8. Free 1040 12       13 Subtract line 12 from line 11. Free 1040 13       14 Divide line 5 by line 10. Free 1040 Enter the result as a decimal. Free 1040 14       15 Tax to be forgiven. Free 1040 Multiply line 13 by line 14 and enter the result. Free 1040 15       Note. Free 1040 If the total of columns (A), (B), and (C) of line 15 (including any amounts shown on line 5 of Worksheet A) is less than $10,000, also complete Worksheet C. Free 1040 Attach the computation of the tax to be forgiven or a copy of this worksheet to the decedent's final income tax return or amended tax return (Form 1040X) for each year listed on line 1. Free 1040 If filing Form 1040X for an eligible year, enter the amount from line 15 above on Form 1040X in column B of line 10 as a decrease in tax. Free 1040 The IRS will determine the amount to be refunded. Free 1040 Worksheet B. Free 1040 Figuring the Tax To Be Forgiven (For Decedents Who Filed a Joint Return)       (A) First Eligible Year (1994 or 2000) (B) Second Eligible Year (1995 or 2001) (C) Third Eligible Year (1996 or 2002) 1 Enter the years eligible for forgiveness. Free 1040 1       2 Enter the decedent's taxable income. Free 1040 Figure taxable income as if a separate return had been filed. Free 1040 See the instructions. Free 1040 2       3 Enter the decedent's total tax. Free 1040 See the instructions. Free 1040 3       4 Enter the total, if any, of the decedent's taxes not eligible for forgiveness. Free 1040 See the instructions. Free 1040 4       5 Subtract line 4 from line 3. Free 1040 5       6 Enter the surviving spouse's taxable income. Free 1040 Figure taxable income as if a separate return had been filed. Free 1040 See the instructions. Free 1040 6       7 Enter the surviving spouse's total tax. Free 1040 See the instructions. Free 1040 7       8 Enter the total, if any, of the surviving spouse's taxes listed in the instructions for line 4. Free 1040 8       9 Subtract line 8 from line 7. Free 1040 9       10 Add lines 5 and 9. Free 1040 10       11 Enter the total tax from the joint return. Free 1040 See Table 1 on page 5 for the line number for years before 2002. Free 1040 11       12 Add lines 4 and 8. Free 1040 12       13 Subtract line 12 from line 11. Free 1040 13       14 Divide line 5 by line 10. Free 1040 Enter the result as a decimal. Free 1040 14       15 Tax to be forgiven. Free 1040 Multiply line 13 by line 14 and enter the result. Free 1040 15       Note. Free 1040 If the total of columns (A), (B), and (C) of line 15 (including any amounts shown on line 5 of Worksheet A) is less than $10,000, also complete Worksheet C. Free 1040 Attach the computation of the tax to be forgiven or a copy of this worksheet to the decedent's final income tax return or amended tax return (Form 1040X) for each year listed on line 1. Free 1040 If filing Form 1040X for an eligible year, enter the amount from line 15 above on Form 1040X in column B of line 10 as a decrease in tax. Free 1040 The IRS will determine the amount to be refunded. Free 1040 Worksheet C. Free 1040 Amount Treated as Tax Payment for Decedent's Last Tax Year Caution: The decedent is entitled to minimum tax forgiveness of $10,000. Free 1040 Complete this worksheet only if the total tax forgiven for all eligible years is less than $10,000. Free 1040 1 Minimum tax forgiveness. Free 1040 Note. Free 1040 Before completing lines 2–9, see Instructions for lines 2–9 of Worksheet C. Free 1040 1 $10,000 2 Enter the taxable income from line 22 (Form 1041) 2       3 Enter the distribution deduction from line 18 (Form 1041) . Free 1040 3       4 Add lines 2 and 3. Free 1040 4       5 Enter exempt income received after death minus expenses allocable to exempt income. Free 1040 (See Income received after date of death on page 5. Free 1040 ) 5       6 Add lines 4 and 5. Free 1040 6       7 Figure the tax on line 6 using Schedule G (Form 1041). Free 1040 7       8 Figure the tax on line 4 using Schedule G (Form 1041). Free 1040 8       9 Tax on exempt income. Free 1040 Subtract line 8 from line 7. Free 1040 9       10 Enter the total of columns (A)–(C) from line 5 of Worksheet A or line 15 of Worksheet B. Free 1040 If the decedent was not required to file tax returns for the eligible tax years, enter -0-. Free 1040 10       11 Add lines 9 and 10. Free 1040 11   12 Additional payment allowed. Free 1040 If line 11 is $10,000 or more, enter -0- and stop here. Free 1040 No additional amount is allowed as a tax payment. Free 1040 Otherwise, subtract line 11 from line 1 and enter the result. Free 1040 12   Note. Free 1040 The amount on line 12 is allowed as a tax payment for the decedent's last tax year (usually 1995 or 2001). Free 1040 Attach the computation of the additional payment allowed or a copy of this worksheet to the original or amended income tax return for the decedent's last tax year. Free 1040 If filing Form 1040, include the amount from line 12 above on the “Other payments” line of the form. Free 1040 Write "Sec. Free 1040 692(d)(2) Payment" and the amount to the right of the entry space. Free 1040 Also indicate whether a Form 1041 is being filed for the decedent's estate. Free 1040 If filing Form 1040X, include the amount from line 12 above on Form 1040X on line 15, columns (B) and (C). Free 1040 Write “Sec. Free 1040 692(d)(2) Payment” on the dotted line to the left of the entry space. Free 1040 Worksheet C. Free 1040 Amount Treated as Tax Payment for Decedent's Last Tax Year Caution: The decedent is entitled to minimum tax forgiveness of $10,000. Free 1040 Complete this worksheet only if the total tax forgiven for all eligible years is less than $10,000. Free 1040 1 Minimum tax forgiveness. Free 1040 Note. Free 1040 Before completing lines 2–9, see Instructions for lines 2–9 of Worksheet C. Free 1040 1 $10,000 2 Enter the taxable income from line 22 (Form 1041) 2       3 Enter the distribution deduction from line 18 (Form 1041) . Free 1040 3       4 Add lines 2 and 3. Free 1040 4       5 Enter exempt income received after death minus expenses allocable to exempt income. Free 1040 (See Income received after date of death on page 5. Free 1040 ) 5       6 Add lines 4 and 5. Free 1040 6       7 Figure the tax on line 6 using Schedule G (Form 1041). Free 1040 7       8 Figure the tax on line 4 using Schedule G (Form 1041). Free 1040 8       9 Tax on exempt income. Free 1040 Subtract line 8 from line 7. Free 1040 9       10 Enter the total of columns (A)–(C) from line 5 of Worksheet A or line 15 of Worksheet B. Free 1040 If the decedent was not required to file tax returns for the eligible tax years, enter -0-. Free 1040 10       11 Add lines 9 and 10. Free 1040 11   12 Additional payment allowed. Free 1040 If line 11 is $10,000 or more, enter -0- and stop here. Free 1040 No additional amount is allowed as a tax payment. Free 1040 Otherwise, subtract line 11 from line 1 and enter the result. Free 1040 12   Note. Free 1040 The amount on line 12 is allowed as a tax payment for the decedent's last tax year (usually 1995 or 2001). Free 1040 Attach the computation of the additional payment allowed or a copy of this worksheet to the original or amended income tax return for the decedent's last tax year. Free 1040 If filing Form 1040, include the amount from line 12 above on the “Other payments” line of the form. Free 1040 Write "Sec. Free 1040 692(d)(2) Payment" and the amount to the right of the entry space. Free 1040 Also indicate whether a Form 1041 is being filed for the decedent's estate. Free 1040 If filing Form 1040X, include the amount from line 12 above on Form 1040X on line 15, columns (B) and (C). Free 1040 Write “Sec. Free 1040 692(d)(2) Payment” on the dotted line to the left of the entry space. Free 1040 How To Get Tax Help Special IRS assistance. Free 1040   The IRS is providing special help for those affected by the terrorist attacks, as well as survivors and personal representatives of the victims. Free 1040 We have set up a special toll-free number for people who may have trouble filing or paying their taxes because they were affected by the terrorist attacks, or who have other tax issues related to the attacks. Free 1040 Call 1–866–562–5227 Monday through Friday In English–7 a. Free 1040 m. Free 1040 to 10 p. Free 1040 m. Free 1040 local time In Spanish–8 a. Free 1040 m. Free 1040 to 9:30 p. Free 1040 m. Free 1040 local time   The IRS web site at www. Free 1040 irs. Free 1040 gov has notices and other tax relief information. Free 1040 Check it periodically for any new guidance or to see if Congress has enacted new legislation. Free 1040   Business taxpayers affected by the attacks can e-mail their questions to corp. Free 1040 disaster. Free 1040 relief@irs. Free 1040 gov. Free 1040   For current information on Presidentially declared disaster areas, check the Federal Emergency Management Agency Web site at www. Free 1040 fema. Free 1040 gov. Free 1040 Other help from the IRS. Free 1040   You can get help with unresolved tax issues, order free publications and forms, ask tax questions, and get more information from the IRS in several ways. Free 1040 By selecting the method that is best for you, you will have quick and easy access to tax help. Free 1040 Contacting your Taxpayer Advocate. Free 1040   If you have attempted to deal with an IRS problem unsuccessfully, you should contact your Taxpayer Advocate. Free 1040   The Taxpayer Advocate represents your interests and concerns within the IRS by protecting your rights and resolving problems that have not been fixed through normal channels. Free 1040 While Taxpayer Advocates cannot change the tax law or make a technical tax decision, they can clear up problems that resulted from previous contacts and ensure that your case is given a complete and impartial review. Free 1040   To contact your Taxpayer Advocate: Call the Taxpayer Advocate at 1–877–777–4778. Free 1040 Call the IRS at 1–800–829–1040. Free 1040 Call, write, or fax the Taxpayer Advocate office in your area. Free 1040 Call 1–800–829–4059 if you are a TTY/TDD user. Free 1040   For more information, see Publication 1546, The Taxpayer Advocate Service of the IRS. Free 1040 Free tax services. Free 1040   To find out what services are available, get Publication 910, Guide to Free Tax Services. Free 1040 It contains a list of free tax publications and an index of tax topics. Free 1040 It also describes other free tax information services, including tax education and assistance programs and a list of TeleTax topics. Free 1040 Personal computer. Free 1040 With your personal computer and modem, you can access the IRS on the Internet at www. Free 1040 irs. Free 1040 gov. Free 1040 While visiting our web site, you can: Find answers to questions you may have. Free 1040 Download forms and publications or search for forms and pub
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Tax Information for Contributors

Organizations Eligible to Receive Tax-Deductible Charitable Contributions
A searchable database of organizations eligible to receive tax-deductible charitable contributions.

Web-Based Mini-Course - Deducting Charitable Contributions
A short course to help charities and contributors understand what is a deductible charitable contribution and what is not. Also covers amount and types of deductible contributions, what records to keep and how to report contributions.

Tax information on donated property
How donors, charities, and tax professionals must report non-cash charitable contributions.

Charitable Contributions - YouTube video
YouTube video on Charitable Contributions.

Substantiating Charitable Contributions
A brief description of the disclosure and substantiation requirements for contributions to charitable organizations.

Tips for Taxpayers Making Charitable Donations
Tips to ensure that contributions pay off on your tax return.

Special Charitable Contributions for Certain IRA Owners
Tax tips for donating IRA funds to charitable organizations.

Form 990 Resources and Tools for the General Public
Form 990 Resources and Tools for the General Public

Page Last Reviewed or Updated: 30-Mar-2014

The Free 1040

Free 1040 Publication 503 - Introductory Material Table of Contents Future Developments Reminders IntroductionOrdering forms and publications. Free 1040 Tax questions. Free 1040 Useful Items - You may want to see: Future Developments For the latest information about developments related to Publication 503, such as legislation enacted after it was published, go to www. Free 1040 irs. Free 1040 gov/pub503. Free 1040 Reminders Taxpayer identification number needed for each qualifying person. Free 1040  You must include on line 2 of Form 2441, Child and Dependent Care Expenses, the name and taxpayer identification number (generally the social security number) of each qualifying person. Free 1040 See Taxpayer identification number under Qualifying Person Test, later. Free 1040 You may have to pay employment taxes. Free 1040  If you pay someone to come to your home and care for your dependent or spouse, you may be a household employer who has to pay employment taxes. Free 1040 Usually, you are not a household employer if the person who cares for your dependent or spouse does so at his or her home or place of business. Free 1040 See Employment Taxes for Household Employers, later. Free 1040 Photographs of missing children. Free 1040  The Internal Revenue Service is a proud partner with the National Center for Missing and Exploited Children. Free 1040 Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. Free 1040 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. Free 1040 Introduction This publication explains the tests you must meet to claim the credit for child and dependent care expenses. Free 1040 It explains how to figure and claim the credit. Free 1040 You may be able to claim the credit if you pay someone to care for your dependent who is under age 13 or for your spouse or dependent who is not able to care for himself or herself. Free 1040 The credit can be up to 35% of your expenses. Free 1040 To qualify, you must pay these expenses so you can work or look for work. Free 1040 This publication also discusses some of the employment tax rules for household employers. Free 1040 Dependent care benefits. Free 1040   If you received any dependent care benefits from your employer during the year, you may be able to exclude from your income all or part of them. Free 1040 You must complete Form 2441, Part III, before you can figure the amount of your credit. Free 1040 See Dependent Care Benefits under How To Figure the Credit, later. Free 1040 Comments and suggestions. Free 1040   We welcome your comments about this publication and your suggestions for future editions. Free 1040   You can write to us at the following address: Internal Revenue Service Tax Forms and Publications Division 1111 Constitution Ave. Free 1040 NW, IR-6526 Washington, DC 20224   We respond to many letters by telephone. Free 1040 Therefore, it would be helpful if you would include your daytime phone number, including the area code, in your correspondence. Free 1040   You can send your comments from www. Free 1040 irs. Free 1040 gov/formspubs/. Free 1040 Click on “More Information” and then on “Comment on Tax Forms and Publications. Free 1040 ”   Although we cannot respond individually to each comment received, we do appreciate your feedback and will consider your comments as we revise our tax products. Free 1040 Ordering forms and publications. Free 1040   Visit www. Free 1040 irs. Free 1040 gov/formspubs/ to download forms and publications, call 1-800-TAX-FORM (1-800-829-3676), or write to the address below and receive a response within 10 days after your request is received. Free 1040 Internal Revenue Service 1201 N. Free 1040 Mitsubishi Motorway Bloomington, IL 61705-6613 Tax questions. Free 1040   If you have a tax question, check the information available on IRS. Free 1040 gov or call 1-800-829-1040. Free 1040 We cannot answer tax questions sent to either of the above addresses. Free 1040 Useful Items - You may want to see: Publication 501 Exemptions, Standard Deduction, and Filing Information 926 Household Employer's Tax Guide Form (and Instructions) 2441 Child and Dependent Care Expenses Schedule H (Form 1040) Household Employment Taxes W-10 Dependent Care Provider's Identification and Certification See How To Get Tax Help , near the end of this publication, for information about getting these publications and forms. Free 1040 Prev  Up  Next   Home   More Online Publications