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Free income tax service 2. Free income tax service   Fuel Tax Credits and Refunds Table of Contents Gasoline and Aviation Gasoline Undyed Diesel Fuel and Undyed Kerosene (Other Than Kerosene Used in Aviation)Sales by Registered Ultimate Vendors Diesel-Water Fuel Emulsion Kerosene for Use in AviationSales by Registered Ultimate Vendors Other Fuels (Including Alternative Fuels) Refunds of Second TaxOptional reporting. Free income tax service Providing information. Free income tax service Definitions of Nontaxable UsesCustom application of fertilizer and pesticide. Free income tax service Fuel used between airfield and farm. Free income tax service Fuel not used for farming. Free income tax service Vehicles not considered highway vehicles. Free income tax service Biodiesel or Renewable Diesel Mixture Credit, Alternative Fuel Credit, and Alternative Fuel Mixture CreditHow to Claim the Credit Filing Claims Claiming A Refund Claiming a Credit on Form 4136 Including the Credit or Refund in Income Federal excise taxes are imposed on certain fuels as discussed in chapter 1. Free income tax service This chapter lists the nontaxable uses of each fuel and defines the nontaxable uses. Free income tax service Information on the refund of second tax is included. Free income tax service This chapter also explains credits and refunds for the biodiesel or renewable diesel mixture credits, and the alternative fuel mixture and alternative fuel credits. Free income tax service Information on how to make a claim for credit or refund is included in this chapter and in the instructions for: Form 720, Form 4136, and Form 8849. Free income tax service Exported taxable fuel. Free income tax service   The claim rates for exported taxable fuel are listed on Schedule C (Form 720), Schedule 1 (Form 8849), and Form 4136. Free income tax service Taxpayers making a claim for exported taxable fuel must include with their records proof of exportation. Free income tax service Proof of exportation includes: A copy of the export bill of lading issued by the delivering carrier, A certificate by the agent or representative of the export carrier showing actual exportation of the fuel, A certificate of lading signed by a customs officer of the foreign country to which the fuel is exported, or A statement of the foreign consignee showing receipt of the fuel. Free income tax service Gasoline and Aviation Gasoline Ultimate Purchasers. Free income tax service   The following are the uses of gasoline (defined earlier) for which a credit or refund may be allowable to an ultimate purchaser. Free income tax service On a farm for farming purposes (credit only). Free income tax service Off-highway business use. Free income tax service Export. Free income tax service In a boat engaged in commercial fishing. Free income tax service In certain intercity and local buses. Free income tax service In a school bus. Free income tax service Exclusive use by a qualified blood collector organization. Free income tax service In a highway vehicle owned by the United States that is not used on a highway. Free income tax service Exclusive use by a nonprofit educational organization (see Sales by registered ultimate vendors and Credit Card Purchases, later). Free income tax service Exclusive use by a state, political subdivision of a state, or the District of Columbia (see Sales by registered ultimate vendors and Credit Card Purchases, later). Free income tax service In an aircraft or vehicle owned by an aircraft museum. Free income tax service   The following are the uses of aviation gasoline for which a credit or refund may be allowable to an ultimate purchaser. Free income tax service On a farm for farming purposes (credit only). Free income tax service Export. Free income tax service In foreign trade. Free income tax service Certain helicopter and fixed-wing air ambulance uses. Free income tax service In commercial aviation (other than foreign trade). Free income tax service Exclusive use by a qualified blood collector organization. Free income tax service Exclusive use by a nonprofit education organization (see Sales by registered ultimate vendors and Credit card purchases, later). Free income tax service Exclusive use by a state, political subdivision of a state, or the District of Columbia (see Sales by registered ultimate vendors and Credit and purchases, later). Free income tax service In an aircraft owned by an aircraft museum. Free income tax service In military aircraft. Free income tax service Claims by persons who paid the tax to the government. Free income tax service   Except for sales to nonprofit educational organizations and states and local governments, a credit or refund is allowable to the person that paid the tax to the government if the gasoline was sold to the ultimate purchaser (including an exporter) by either that person or by a retailer and the fuel was exported; used or sold for use as supplies for vessels or aircraft, including military aircraft, commercial fishing, and foreign trade; sold to a qualified blood collector organization; or used or sold for use in the production of Other Fuels. Free income tax service See Filing Claims, later. Free income tax service Sales by registered ultimate vendors. Free income tax service   This is an ultimate vendor that sells gasoline or aviation gasoline to any of the following and that is purchased without the use of a credit card. Free income tax service A state or local government for its exclusive use (including essential government use by an Indian tribal government). Free income tax service A nonprofit educational organization for its exclusive use. Free income tax service   The registered ultimate vendor may make the claim if the ultimate purchaser did not use a credit card and waives its right to the credit or refund by providing the registered ultimate vendor with a certificate. Free income tax service A sample certificate is included as Model Certificate M in the Appendix. Free income tax service The registered ultimate vendor must have the certificate at the time the credit or refund is claimed. Free income tax service   The ultimate vendor must be registered by the IRS. Free income tax service See Registration Requirements, earlier. Free income tax service Credit card purchases. Free income tax service   If gasoline and aviation gasoline are purchased with a credit card issued to a state or local government for its exclusive use (including essential government use by an Indian tribal government), or a nonprofit educational organization for its exclusive use, the person who extended credit to the ultimate purchaser (the credit card issuer) is treated as the person that paid the tax and makes the claim if the credit card issuer: Is registered by the IRS, Has established that the amount of tax has not been collected from the person who purchased the gasoline or has obtained written consent from the ultimate purchaser to the allowance of the credit or refund, and Has repaid or agreed to repay the amount of the tax to the ultimate vendor, has obtained the written consent of the ultimate vendor to the allowance of the credit or refund, or has made arrangements that provide the ultimate vendor with reimbursement of the tax. Free income tax service   If the requirements above are not met by the credit card issuer, the credit card issuer must collect the tax from the ultimate purchaser and only the ultimate purchaser may make the claim. Free income tax service How to make the claim. Free income tax service   If the claim is made by the credit card issuer, see Schedule C  (Form 720) or Schedule 8 (Form 8849). Free income tax service Undyed Diesel Fuel and Undyed Kerosene (Other Than Kerosene Used in Aviation) For conditions to an allowance of a credit or refund on exported dyed diesel fuel and dyed kerosene, see Exported taxable fuel, earlier. Free income tax service Ultimate purchasers. Free income tax service   The following are nontaxable uses of diesel fuel and kerosene (defined earlier) for which a credit or refund may be allowable to an ultimate purchaser. Free income tax service On a farm for farming purposes. Free income tax service Off-highway business use. Free income tax service Export. Free income tax service In a qualified local bus. Free income tax service In a school bus. Free income tax service Other than as a fuel in a propulsion engine of a diesel-powered highway vehicle (such as home heating oil). Free income tax service Exclusive use by a qualified blood collector organization. Free income tax service In a highway vehicle owned by the United States that is not used on a highway. Free income tax service Exclusive use by a nonprofit educational organization (see Sales by Registered Ultimate Vendors and Credit Card Purchases, later). Free income tax service Exclusive use by a state, political subdivision of a state, or the District of Columbia (see Sales by Registered Ultimate Vendors and Credit Card Purchases, later). Free income tax service In a vehicle owned by an aircraft museum. Free income tax service As a fuel in a propulsion engine of a diesel-powered train. Free income tax service Sales by Registered Ultimate Vendors The following are the sales for which a credit or refund may be allowable to the registered ultimate vendor only. Free income tax service Undyed diesel fuel or undyed kerosene sold for the exclusive use by a state or local government (if credit card rules (defined later) do not apply), Undyed kerosene sold from a blocked pump (defined below), or Undyed diesel fuel or undyed kerosene used in certain intercity and local buses, only if the ultimate purchaser waives its right to the credit or refund by providing the registered ultimate vendor with a waiver. Free income tax service Registered ultimate vendor (state use). Free income tax service   This is a person that sells undyed diesel fuel or undyed kerosene to a state or local government for its exclusive use (including essential government use by an Indian tribal government). Free income tax service The diesel fuel or kerosene must be purchased by the state without the use of a credit card, issued to the state by the credit card issuer, in order for the ultimate vendor to make the claim. Free income tax service The ultimate vendor must be registered by the IRS. Free income tax service See Registration Requirements, earlier. Free income tax service Registered ultimate vendor (blocked pump). Free income tax service   This is an ultimate vendor that sells undyed kerosene from a blocked pump. Free income tax service   A credit or refund may be allowable to a registered ultimate vendor (blocked pump) if the vendor sold to a buyer undyed kerosene from a blocked pump for use other than as a fuel in a diesel-powered highway vehicle and the vendor had no reason to believe the kerosene would not be used in that manner. Free income tax service Blocked pump. Free income tax service   A blocked pump is a fuel pump that meets all the following requirements. Free income tax service It is used to make retail sales of undyed kerosene for use by the buyer in any nontaxable use. Free income tax service It is at a fixed location. Free income tax service It is identified with a legible and conspicuous notice stating, “UNDYED UNTAXED KEROSENE, NONTAXABLE USE ONLY. Free income tax service ” It meets either of the following conditions. Free income tax service It cannot reasonably be used to dispense fuel directly into the fuel supply tank of a diesel-powered highway vehicle or train. Free income tax service It is locked by the vendor after each sale and unlocked by the vendor only in response to a buyer's request for undyed kerosene for use other than as a fuel in a diesel-powered highway vehicle or train. Free income tax service Registered ultimate vendor (certain intercity and local buses). Free income tax service   This is an ultimate vendor that sells undyed diesel fuel or undyed kerosene to the ultimate purchaser for use in certain intercity and local buses. Free income tax service   The registered ultimate vendor may make the claim if the ultimate purchaser waives its right to the credit or refund by providing the registered ultimate vendor with a waiver. Free income tax service A sample waiver is included as Model Waiver N in the Appendix. Free income tax service The registered ultimate vendor must have the waiver at the time the credit or payment is claimed. Free income tax service Credit Card Purchases. Free income tax service   If undyed diesel fuel or kerosene is purchased with a credit card issued to a state, the person who extended credit to the state (the credit card issuer) is treated as the person that paid the tax and makes the claim if the credit card issuer: Is registered by the IRS, Has established that the amount of tax has not been collected from the person who purchased the diesel fuel or kerosene, or has obtained written consent from the ultimate purchaser to the allowance of the credit or refund, and Has repaid or agreed to repay the amount of the tax to the ultimate vendor, has obtained the written consent of the ultimate vendor to the allowance of the credit or refund, or has made arrangements that provide the ultimate vendor with reimbursement of the tax. Free income tax service   If the requirements above are not met by the credit card issuer, the credit card issuer must collect the tax from the ultimate purchaser and only the ultimate purchaser may make the claim. Free income tax service Diesel-Water Fuel Emulsion A claim for credit or refund may be made for the nontaxable use of a diesel-water fuel emulsion and for undyed diesel fuel used to produce a diesel-water fuel emulsion. Free income tax service The claim rate for nontaxable use of a diesel-water fuel emulsion taxed at $. Free income tax service 198 per gallon is $. Free income tax service 197 (if exported, the claim rate is $. Free income tax service 198). Free income tax service The following are the nontaxable uses for a diesel-water fuel emulsion for which a credit or refund may be allowable to an ultimate purchaser. Free income tax service On a farm for farming purposes. Free income tax service Off-highway business use. Free income tax service Export. Free income tax service In a qualified local bus. Free income tax service In a school bus. Free income tax service Other than as fuel in the propulsion engine of a train or diesel-powered highway vehicle (but not off-highway use). Free income tax service Exclusive use by a qualified blood collector organization. Free income tax service In a highway vehicle owned by the United States that is not used on a highway. Free income tax service Exclusive use by a nonprofit educational organization. Free income tax service Exclusive use by a state, political subdivision of a state, or the District of Columbia. Free income tax service In an aircraft or vehicle owned by an aircraft museum. Free income tax service Blender claims. Free income tax service   The claim rate for undyed diesel fuel taxed at $. Free income tax service 244 and used to produce a diesel-water fuel emulsion is $. Free income tax service 046 per gallon of diesel fuel so used. Free income tax service The blender must be registered by the IRS in order to make the claim. Free income tax service The blender must attach a statement to the claim certifying that: The diesel-water fuel emulsion contains at least 14% water, The emulsion additive is registered by a United States manufacturer with the EPA under section 211 of the Clean Air Act as in effect on March 31, 2003, Undyed diesel fuel taxed at $. Free income tax service 244 was used to produce the diesel-water fuel emulsion, and The diesel-water fuel emulsion was used or sold for use in the blender's trade or business. Free income tax service Kerosene for Use in Aviation Ultimate purchasers. Free income tax service   Ultimate purchasers of kerosene used in certain aviation uses may make a claim if the rate of tax on their use is less than the rate of tax that was charged on the kerosene. Free income tax service   The ultimate purchaser of the kerosene used in commercial aviation (other than foreign trade) and noncommercial aviation (other than nonexempt, noncommercial aviation and exclusive use by a state, political subdivision of a state, or the District of Columbia) is eligible to make a claim if the ultimate purchaser certifies that the right to make the claim has not been waived. Free income tax service Generally, the ultimate purchaser is the aircraft operator. Free income tax service   The following are the nontaxable uses of kerosene used in noncommercial aviation for which a credit or refund may be allowable to the ultimate purchaser. Free income tax service On a farm for farming purposes. Free income tax service Certain helicopter and fixed-wing aircraft uses. Free income tax service Exclusive use by a qualified blood collector organization. Free income tax service Exclusive use by a nonprofit educational organization. Free income tax service In an aircraft owned by an aircraft museum. Free income tax service In military aircraft. Free income tax service Kerosene for use partly in commercial aviation and partly in nonexempt, noncommercial aviation. Free income tax service   If the fuel is used partly for use in commercial aviation and partly for use in nonexempt, noncommercial aviation, the operator may identify, either at the time of purchase or after the kerosene has been used, the amount that will be (or has been) used in commercial aviation. Free income tax service At the same time, the operator would either make the claim or waive the right to make the claim for credit or refund of the kerosene for use in commercial and nonexempt, noncommercial aviation. Free income tax service   If the operator does not identify the amount of kerosene that will be (or has been) used in commercial aviation, the operator may provide a certificate to the ultimate vendor similar to Model Certificate Q in the Appendix. Free income tax service For kerosene purchased with the certificate, used in commercial aviation, and taxed at $. Free income tax service 244 per gallon, use of the certificate will be treated as a waiver of the right to claim a credit or refund for the $. Free income tax service 025 per gallon part of the tax. Free income tax service The ultimate vendor may make this claim. Free income tax service The operator may make a claim for the $. Free income tax service 175 tax per gallon of the kerosene, but cannot waive the right to make the claim for the $. Free income tax service 175 tax per gallon. Free income tax service Sales by Registered Ultimate Vendors Kerosene for use in commercial aviation or noncommercial aviation. Free income tax service   The registered ultimate vendor of kerosene for use in commercial aviation (other than foreign trade) or noncommercial aviation (other than nonexempt, noncommercial aviation and exclusive use by a state, political subdivision of a state, or the District of Columbia) may make this claim if the ultimate purchaser waives its right to the credit or payment by providing the registered ultimate vendor with a waiver. Free income tax service A sample waiver is included as Model Waiver L in the Appendix. Free income tax service The registered ultimate vendor must have the waiver at the time the credit or payment is claimed. Free income tax service   Noncommercial aviation means any use of an aircraft not described as commercial aviation. Free income tax service For the definition of commercial aviation, see Commercial aviation on page 11. Free income tax service Kerosene for use in nonexempt, noncommercial aviation. Free income tax service   Only the registered ultimate vendor may claim a credit or payment for sales of kerosene for use in nonexempt, noncommercial aviation. Free income tax service The ultimate vendor must be registered by the IRS (activity letter UA) and have the required certificate from the ultimate purchaser. Free income tax service A sample certificate is included as Model Certificate Q in the Appendix. Free income tax service The registered ultimate vendor must have the certificate at the time the credit or payment is claimed. Free income tax service Kerosene for use in aviation by a state or local government. Free income tax service   Only the registered ultimate vendor may claim a credit or payment for sales of kerosene for use in aviation to a state or local government for its exclusive use (including essential government use by an Indian tribal government). Free income tax service The kerosene for use in aviation must be purchased by the state without the use of a credit card in order for the ultimate vendor to make the claim. Free income tax service The ultimate vendor must be registered by the IRS (activity letter UV) and have the required certificate from the ultimate purchaser. Free income tax service A sample certificate is included as Model Certificate P in the Appendix. Free income tax service The registered ultimate vendor must have the certificate at the time the credit or payment is claimed. Free income tax service Credit card purchases. Free income tax service   If taxed kerosene for use in aviation is purchased with a credit card issued to a state, the person who extended credit to the state (the credit card issuer) is treated as the person that paid the tax and makes the claim if the credit card issuer: Is registered by the IRS, Has established that the amount of tax has not been collected from the person who purchased the kerosene, or has obtained written consent from the ultimate purchaser to the allowance of the credit or refund, and Has repaid or agreed to repay the amount of the tax to the ultimate vendor, has obtained the written consent of the ultimate vendor to the allowance of the credit or refund, or has made arrangements that provide the ultimate vendor with reimbursement of the tax. Free income tax service   If the requirements above are not met by the credit card issuer, the credit card issuer must collect the tax from the ultimate purchaser and only the ultimate purchaser may make the claim. Free income tax service Other Fuels (Including Alternative Fuels) Credit or refund for nontaxable use of taxed Other Fuels may be allowable to an ultimate purchaser. Free income tax service While tax is generally imposed on delivery, Other Fuels are taxed prior to delivery in the case of certain bulk sales described in chapter 1. Free income tax service The following are the nontaxable uses of Other Fuels for which a credit or refund may be allowable to the ultimate purchaser. Free income tax service On a farm for farming purposes. Free income tax service Off-highway business use. Free income tax service In a boat engaged in commercial fishing. Free income tax service In certain intercity and local buses. Free income tax service In a school bus. Free income tax service In a qualified local bus. Free income tax service Exclusive use by a qualified blood collector organization. Free income tax service Exclusive use by a nonprofit educational organization. Free income tax service Exclusive use by a state, political subdivision of a state, or the District of Columbia. Free income tax service In an aircraft or vehicle owned by an aircraft museum. Free income tax service Use in any boat operated by the United States for its exclusive use or any vessel of war of any foreign nation. Free income tax service See Biodiesel or Renewable Diesel Mixture Credit, Alternative Fuel Credit, and Alternative Fuel Mixture Credit, later. Free income tax service Refunds of Second Tax The tax on dyed diesel fuel for inland waterways fuel use applies at the rate listed on Form 720. Free income tax service This is in addition to all other taxes imposed on the sale or use of the fuel. Free income tax service The section 4081(e) refund (discussed below) cannot be claimed. Free income tax service If the tax is paid and reported to the government on more than one taxable event for a taxable fuel under section 4081, the person paying the “second tax” may claim a refund (without interest) of that tax if certain conditions and reporting requirements are met. Free income tax service No credit against any tax is allowed for this tax. Free income tax service For information about taxable events, see the discussions under Gasoline, Diesel Fuel and Kerosene and Kerosene for Use in Aviation in chapter 1. Free income tax service Conditions to allowance of refund. Free income tax service   A claim for refund of the tax is allowed only if all the following conditions are met. Free income tax service A tax on the fuel was paid to the government and not credited or refunded (the “first tax”). Free income tax service After the first tax was imposed, another tax was imposed on the same fuel and was paid to the government (the “second tax”). Free income tax service The person that paid the second tax filed a timely claim for refund containing the information required (see Refund claim, later). Free income tax service The person that paid the first tax has met the reporting requirements, discussed next. Free income tax service Reporting requirements. Free income tax service   Generally, the person that paid the first tax must file a “First Taxpayer's Report” with its Form 720 for the quarter to which the report relates. Free income tax service A model first taxpayer's report is shown in the Appendix as Model Certificate B. Free income tax service The report must contain all information needed to complete the model. Free income tax service   By the due date for filing the Form 720, you must also send a separate copy of the report to the following address. Free income tax service Department of the Treasury Internal Revenue Service  Cincinnati, OH 45999-0555 Write “EXCISE – FIRST TAXPAYER'S REPORT” across the top of that copy. Free income tax service Optional reporting. Free income tax service   A first taxpayer's report is not required for the tax imposed on: Removal at a terminal rack, Nonbulk entries into the United States, and Removals or sales by blenders. Free income tax service However, if the person liable for the tax expects that another tax will be imposed on that fuel, that person should (but is not required to) file a first taxpayer's report. Free income tax service Providing information. Free income tax service   The first taxpayer must give a copy of the report to the buyer of the fuel within the bulk transfer/terminal system or to the owner of the fuel immediately before the first tax was imposed, if the first taxpayer is not the owner at that time. Free income tax service If an optional report is filed, a copy should (but is not required to) be given to the buyer or owner. Free income tax service   A person that receives a copy of the first taxpayer's report and later sells the fuel within the bulk transfer/terminal system must give the copy and a “Statement of Subsequent Seller” to the buyer. Free income tax service If the later sale is outside the bulk transfer/terminal system and that person expects that another tax will be imposed, that person should (but is not required to) give the copy and the statement to the buyer. Free income tax service A model statement of subsequent seller is shown in the Appendix as Model Certificate A. Free income tax service The statement must contain all information necessary to complete the model. Free income tax service   If the first taxpayer's report relates to fuel sold to more than one buyer, copies of that report must be made when the fuel is divided. Free income tax service Each buyer must be given a copy of the report. Free income tax service Refund claim. Free income tax service   You must have filed Form 720 and paid the second tax before you file for a refund of that tax. Free income tax service You must make your claim for refund on Form 8849. Free income tax service Complete Schedule 5 (Form 8849) and attach it to your Form 8849. Free income tax service Do not include this claim with a claim under another tax provision. Free income tax service You must not have included the second tax in the price of the fuel and must not have collected it from the purchaser. Free income tax service You must submit the following information with your claim. Free income tax service A copy of the first taxpayer's report (discussed earlier). Free income tax service A copy of the statement of subsequent seller if the fuel was bought from someone other than the first taxpayer. Free income tax service Definitions of Nontaxable Uses This section provides definitions of the terms used in Table 2-1 for nontaxable uses. Free income tax service If applicable, the type of use number from Table 2-1 is indicated in each heading. Free income tax service Type of use table. Free income tax service   The first column of the table is the number you enter on Form 4136, Form 8849, or Schedule C (Form 720) for that type of use. Free income tax service For type of use 2, the mobile machinery parenthetical applies only to Form 8849 and Form 720. Free income tax service Table 2-1. Free income tax service Type of Use Table No. Free income tax service Type of Use 1 On a farm for farming purposes 2 Off-highway business use (for business use other than in a highway vehicle registered or required to be registered for highway use) (other than use in mobile machinery) 3 Export 4 In a boat engaged in commercial fishing 5 In certain intercity and local buses 6 In a qualified local bus 7 In a bus transporting students and employees of schools (school buses) 8 For diesel fuel and kerosene (other than kerosene used in aviation) used other than as a fuel in the propulsion engine of a train or diesel-powered highway vehicle (but not off-highway business use) 9 In foreign trade 10 Certain helicopter and fixed-wing aircraft uses 11 Exclusive use by a qualified blood collector organization 12 In a highway vehicle owned by the United States that is not used on a highway 13 Exclusive use by a nonprofit educational organization 14 Exclusive use by a state, political subdivision of a state, or the District of Columbia 15 In an aircraft or vehicle owned by an aircraft museum 16 In military aircraft On a farm for farming purposes (No. Free income tax service 1). Free income tax service   On a farm for farming purposes means fuel used in carrying on a trade or business of farming, on a farm in the United States, and for farming purposes. Free income tax service Farm. Free income tax service   A farm includes livestock, dairy, fish, poultry, fruit, fur-bearing animals, and truck farms; orchards; plantations; ranches; nurseries; ranges; and feed yards for fattening cattle. Free income tax service It also includes structures such as greenhouses used primarily for the raising of agricultural or horticultural commodities. Free income tax service A fish farm is an area where fish are grown or raised — not merely caught or harvested. Free income tax service Farming purposes. Free income tax service   As an owner, tenant, or operator, you use fuel on a farm for farming purposes if you use it in any of the following ways. Free income tax service To cultivate the soil or to raise or harvest any agricultural or horticultural commodity. Free income tax service To raise, shear, feed, care for, train, or manage livestock, bees, poultry, fur-bearing animals, or wildlife. Free income tax service To operate, manage, conserve, improve, or maintain your farm and its tools and equipment. Free income tax service To handle, dry, pack, grade, or store any raw agricultural or horticultural commodity. Free income tax service For this use to qualify, you must have produced more than half the commodity so treated during the tax year. Free income tax service Commodity means a single raw product. Free income tax service For example, apples and peaches are two separate commodities. Free income tax service To plant, cultivate, care for, or cut trees or to prepare (other than sawing logs into lumber, chipping, or other milling) trees for market, but only if the planting, etc. Free income tax service , is incidental to your farming operations. Free income tax service Your tree operations will be incidental only if they are minor in nature when compared to the total farming operations. Free income tax service   If any other person, such as a neighbor or custom operator, performs a service for you on your farm for any of the purposes listed in (1) or (2), you are considered to be the ultimate purchaser that used the fuel on a farm for farming purposes. Free income tax service However, see Custom application of fertilizer and pesticide, next. Free income tax service   If doubt exists whether the owner, the tenant, or the operator of the farm bought the fuel, determine who bore the cost of the fuel. Free income tax service For example, if the owner of a farm and the tenant equally share the cost of gasoline that is used on a farm for farming purposes, each can claim a credit for the tax on one-half the fuel used. Free income tax service Custom application of fertilizer and pesticide. Free income tax service   Fuel used on a farm for farming purposes includes fuel used in the application of fertilizer, pesticides, or other substances, including aerial applications. Free income tax service Generally, the applicator is treated as having used the fuel on a farm for farming purposes. Free income tax service For aviation gasoline, the aerial applicator makes the claim as the ultimate purchaser. Free income tax service For kerosene used in aviation, the ultimate purchaser may make the claim or waive their right to make the claim to the registered ultimate vendor. Free income tax service Fuel used between airfield and farm. Free income tax service   Fuel used by an aerial applicator for the direct flight between the airfield and one or more farms is treated as a farming purpose. Free income tax service Fuel not used for farming. Free income tax service   Fuel is not used on a farm for farming purposes if it is used in any of the following ways. Free income tax service Off the farm, such as on the highway or in noncommercial aviation, other than fuel used between the airfield and farm described above, even if the fuel is used in transporting livestock, feed, crops, or equipment. Free income tax service For personal use, such as mowing the lawn. Free income tax service In processing, packaging, freezing, or canning operations. Free income tax service In processing crude gum into gum spirits of turpentine or gum resin or in processing maple sap into maple syrup or maple sugar. Free income tax service Off-highway business use (No. Free income tax service 2). Free income tax service   Off-highway business use means fuel used in a trade or business or in an income-producing activity other than as a fuel in a highway vehicle registered or required to be registered for use on public highways. Free income tax service The terms “highway vehicle,” “public highway,” and “registered” are defined below. Free income tax service Do not consider any use in a boat as an off-highway business use. Free income tax service   Off-highway business use includes fuels used in any of the following ways. Free income tax service In stationary machines such as generators, compressors, power saws, and similar equipment. Free income tax service For cleaning purposes. Free income tax service In forklift trucks, bulldozers, and earthmovers. Free income tax service   Generally, this use does not include nonbusiness use of fuel, such as use by minibikes, snowmobiles, power lawn mowers, chain saws, and other yard equipment. Free income tax service Example. Free income tax service Caroline owns a landscaping business. Free income tax service She uses power lawn mowers and chain saws in her business. Free income tax service The gasoline used in the power lawn mowers and chain saws qualifies as fuel used in an off-highway business use. Free income tax service The gasoline used in her personal lawn mower at home does not qualify. Free income tax service Highway vehicle. Free income tax service   A highway vehicle is any self-propelled vehicle designed to carry a load over public highways, whether or not it is also designed to perform other functions. Free income tax service Examples of vehicles designed to carry a load over public highways are passenger automobiles, motorcycles, buses, and highway-type trucks and truck tractors. Free income tax service A vehicle is a highway vehicle even though the vehicle's design allows it to perform a highway transportation function for only one of the following. Free income tax service A particular type of load, such as passengers, furnishings, and personal effects (as in a house, office, or utility trailer). Free income tax service A special kind of cargo, goods, supplies, or materials. Free income tax service Some off-highway task unrelated to highway transportation, except as discussed next. Free income tax service Vehicles not considered highway vehicles. Free income tax service   Generally, the following kinds of vehicles are not considered highway vehicles for purposes of the credit or refund of fuel taxes. Free income tax service Specially designed mobile machinery for nontransportation functions. Free income tax service A self-propelled vehicle is not a highway vehicle if all the following apply. Free income tax service The chassis has permanently mounted to it machinery or equipment used to perform certain operations (construction, manufacturing, drilling, mining, timbering, processing, farming, or similar operations) if the operation of the machinery or equipment is unrelated to transportation on or off the public highways. Free income tax service The chassis has been specially designed to serve only as a mobile carriage and mount (and power source, if applicable) for the machinery or equipment, whether or not the machinery or equipment is in operation. Free income tax service The chassis could not, because of its special design and without substantial structural modification, be used as part of a vehicle designed to carry any other load. Free income tax service The vehicle must have traveled less than 7,500 miles on public highways during the taxable year. Free income tax service Vehicles specially designed for off-highway transportation. Free income tax service A vehicle is not treated as a highway vehicle if the vehicle is specially designed for the primary function of transporting a particular type of load other than over the public highway and because of this special design, the vehicle's capability to transport a load over a public highway is substantially limited or impaired. Free income tax service To make this determination, you can take into account the vehicle's size, whether the vehicle is subject to licensing, safety, or other requirements, and whether the vehicle can transport a load at a sustained speed of at least 25 miles per hour. Free income tax service It does not matter that the vehicle can carry heavier loads off highway than it is allowed to carry over the highway. Free income tax service Nontransportation trailers and semitrailers. Free income tax service A trailer or semi-trailer is not treated as a highway vehicle if it is specially designed to function only as an enclosed stationary shelter for carrying on a nontransportation function at an off-highway site. Free income tax service For example, a trailer that is capable only of functioning as an office for an off-highway construction operation is not a highway vehicle. Free income tax service Public highway. Free income tax service   A public highway includes any road in the United States that is not a private roadway. Free income tax service This includes federal, state, county, and city roads and streets. Free income tax service Registered. Free income tax service   A vehicle is considered registered when it is registered or required to be registered for highway use under the law of any state, the District of Columbia, or any foreign country in which it is operated or situated. Free income tax service Any highway vehicle operated under a dealer's tag, license, or permit is considered registered. Free income tax service A highway vehicle is not considered registered solely because a special permit allows the vehicle to be operated at particular times and under specified conditions. Free income tax service Dual use of propulsion motor. Free income tax service   Off-highway business use does not include any fuel used in the propulsion motor of a registered highway vehicle even though that motor also operates special equipment by means of a power take-off or power transfer. Free income tax service It does not matter if the special equipment is mounted on the vehicle. Free income tax service Example. Free income tax service The motor of a registered concrete-mixer truck operates both the engine and the mixing unit by means of a power take-off. Free income tax service The fuel used in the motor to run the mixer is not off-highway business use. Free income tax service Use in separate motor. Free income tax service   Off-highway business use includes fuel used in a separate motor to operate special equipment, such as a refrigeration unit, pump, generator, or mixing unit. Free income tax service If you draw fuel from the same tank that supplies fuel to the propulsion motor, you must figure the quantity used in the separate motor operating the special equipment. Free income tax service You may make a reasonable estimate based on your operating experience and supported by your records. Free income tax service   You can use devices that measure the miles the vehicle has traveled (such as hubometers) to figure the gallons of fuel used to propel the vehicle. Free income tax service Add to this amount the fuel consumed while idling or warming up the motor before propelling the vehicle. Free income tax service The difference between your total fuel used and the fuel used to propel the vehicle is the fuel used in the separate motor. Free income tax service Example. Free income tax service Hazel owns a refrigerated truck. Free income tax service It has a separate motor for the refrigeration unit. Free income tax service The same tank supplies both motors. Free income tax service Using the truck's hubometer, Hazel figures that 90% of the fuel was used to propel the truck. Free income tax service Therefore, 10% of the fuel is used in an off-highway business use. Free income tax service Fuel lost or destroyed. Free income tax service   You cannot treat fuel lost or destroyed through spillage, fire, or other casualty as fuel used in an off-highway business use. Free income tax service Export (No. Free income tax service 3). Free income tax service   Export means fuel transported from the United States with the intention that the fuel remain in a foreign country or possession of the United States. Free income tax service Fuel is not exported if it is in the fuel supply tank of a vehicle or aircraft. Free income tax service In a boat engaged in commercial fishing (No. Free income tax service 4). Free income tax service   In a boat engaged in commercial fishing means fuel used in taking, catching, processing, or transporting fish, shellfish, or other aquatic life for commercial purposes, such as selling or processing the catch, on a specific trip basis. Free income tax service They include boats used in both fresh and salt water fishing. Free income tax service They do not include boats used for both sport fishing and commercial fishing on the same trip. Free income tax service In certain intercity and local buses (No. Free income tax service 5). Free income tax service   In certain intercity and local buses means fuel used in a bus engaged in furnishing (for compensation) passenger land transportation available to the general public. Free income tax service The bus must be engaged in one of the following activities. Free income tax service Scheduled transportation along regular routes. Free income tax service Nonscheduled operations if the seating capacity of the bus is at least 20 adults, not including the driver. Free income tax service Vans and similar vehicles used for van-pooling or taxi service do not qualify. Free income tax service Available to the general public. Free income tax service   This means you offer service to more than a limited number of persons or organizations. Free income tax service If a bus operator normally provides charter operations through travel agencies but has buses available for chartering by the general public, this service is available to the general public. Free income tax service A bus does not qualify when its operator uses it to provide exclusive services to only one person, group, or organization. Free income tax service Also, intercity bus transportation does not include transporting students and employees of schools or intercity transportation in a qualified local bus. Free income tax service In a qualified local bus (No. Free income tax service 6). Free income tax service   In a qualified local bus means fuel used in a bus meeting all the following requirements. Free income tax service It is engaged in furnishing (for compensation) intracity passenger land transportation available to the general public. Free income tax service It operates along scheduled, regular routes. Free income tax service It has a seating capacity of at least 20 adults (excluding the driver). Free income tax service It is under contract with (or is receiving more than a nominal subsidy from) any state or local government to furnish the transportation. Free income tax service Intracity passenger land transportation. Free income tax service   This is the land transportation of passengers between points located within the same metropolitan area. Free income tax service It includes transportation along routes that cross state, city, or county boundaries if the routes remain within the metropolitan area. Free income tax service Under contract. Free income tax service   A bus is under contract with a state or local government only if the contract imposes a bona fide obligation on the bus operator to furnish the transportation. Free income tax service More than a nominal subsidy. Free income tax service   A subsidy is more than nominal if it is reasonably expected to exceed an amount equal to 3 cents multiplied by the number of gallons of fuel used in buses on subsidized routes. Free income tax service A company that operates its buses along subsidized and unsubsidized intracity routes may consider its buses qualified local buses only when the buses are used on the subsidized intracity routes. Free income tax service In a school bus (No. Free income tax service 7). Free income tax service   In a school bus means fuel used in a bus engaged in the transportation of students or employees of schools. Free income tax service A school is an educational organization with a regular faculty and curriculum and a regularly enrolled body of students who attend the place where the educational activities occur. Free income tax service For diesel fuel and kerosene (other than kerosene used in aviation) used other than as a fuel (No. Free income tax service 8). Free income tax service   Diesel fuel and kerosene (other than kerosene used in aviation) used other than as a fuel in the propulsion engine of a diesel-powered highway vehicle or diesel-powered train (not including off-highway business use) means undyed diesel fuel and undyed kerosene used: For home heating, lighting, and cooking; In boats; In stationary machines, such as generators and compressors; For cleaning purposes; or In minibikes and snowmobiles. Free income tax service In foreign trade (No. Free income tax service 9). Free income tax service   In foreign trade means fuel used in civil aircraft employed in foreign trade or trade between the United States and any of its possessions. Free income tax service The term trade includes the transportation of persons or property for hire and the making of the necessary preparations for such transportation. Free income tax service In the case of aircraft registered in a foreign country, the country must allow reciprocal benefits for aircraft registered in the United States. Free income tax service Certain helicopter and fixed-wing aircraft uses (No. Free income tax service 10). Free income tax service   Includes: Certain helicopter uses. Free income tax service   Certain helicopter uses means fuel used by a helicopter for any of the following purposes. Free income tax service Transporting individuals, equipment, or supplies in the exploration for, or the development or removal of, hard minerals, oil, or gas. Free income tax service Planting, cultivating, cutting, transporting, or caring for trees (including logging operations). Free income tax service Providing emergency medical transportation. Free income tax service   During a use described in items (1) and (2), the helicopter must not take off from, or land at, a facility eligible for assistance under the Airport and Airway Development Act of 1970, or otherwise use services provided pursuant to section 44509 or 44913(b) or subchapter I of chapter 471 of title 49, United States Code. Free income tax service For item (1), treat each flight segment as a separate flight. Free income tax service Fixed-wing aircraft uses. Free income tax service   Fixed-wing aircraft uses means fuel used by a fixed-wing aircraft for any of the following purposes. Free income tax service Planting, cultivating, cutting, transporting, or caring for trees (including logging operations). Free income tax service Providing emergency medical transportation. Free income tax service The aircraft must be equipped for and exclusively dedicated on that flight to acute care emergency medical services. Free income tax service During a use described in item (1), the aircraft must not take off from, or land at, a facility eligible for assistance under the Airport and Airway Development Act of 1970, or otherwise use services provided pursuant to section 44509 or 44913(b) or subchapter I of chapter 471 of title 49, United States Code. Free income tax service Exclusive use by a qualified blood collector organization (No. Free income tax service 11). Free income tax service   Exclusive use by a qualified blood collector organization means fuel used by the qualified blood collector organization for its exclusive use in the collection, storage, or transportation of blood. Free income tax service Qualified blood collector organization. Free income tax service   A qualified blood collector organization is one that is: Described in section 501(c)(3) and exempt from tax under section 501(a), Primarily engaged in the activity of collecting human blood, Registered by the IRS, and Registered by the Food and Drug Administration to collect blood. Free income tax service In a highway vehicle owned by the United States that is not used on a highway (No. Free income tax service 12). Free income tax service   In a highway vehicle owned by the United States that is not used on a highway means fuel used in a vehicle that was not used on public highways during the period covered by the claim. Free income tax service This use applies whether or not the vehicle is registered or required to be registered for highway use. Free income tax service Exclusive use by a nonprofit educational organization (No. Free income tax service 13). Free income tax service   Exclusive use by a nonprofit educational organization means fuel used by an organization exempt from income tax under section 501(a) that meets both of the following requirements. Free income tax service It has a regular faculty and curriculum. Free income tax service It has a regularly enrolled body of students who attend the place where the instruction normally occurs. Free income tax service   A nonprofit educational organization also includes a school operated by a church or other organization described in section 501(c)(3) if the school meets the above requirements. Free income tax service Exclusive use by a state, political subdivision of a state, or the District of Columbia (No. Free income tax service 14). Free income tax service   Exclusive use by a state, political subdivision of a state, or the District of Columbia means fuel purchased by the state or local government for its exclusive use. Free income tax service A state or local government is any state, any political subdivision thereof, or the District of Columbia. Free income tax service An Indian tribal government is treated as a state only if the fuel is used in an activity that involves the exercise of an essential tribal government function. Free income tax service Gasoline, diesel fuel, and kerosene used by the American Red Cross is considered to be the use of these fuels by a state. Free income tax service In an aircraft or vehicle owned by an aircraft museum (No. Free income tax service 15). Free income tax service   In an aircraft or vehicle owned by an aircraft museum means fuel used in an aircraft or vehicle that is owned by an organization that meets all the following requirements. Free income tax service It is exempt from income tax as an organization described in section 501(c)(3). Free income tax service It is operated as a museum under a state (or District of Columbia) charter. Free income tax service It is operated exclusively for acquiring, exhibiting, and caring for aircraft of the type used for combat or transport in  World War II. Free income tax service   The aircraft or vehicle (such as a ground servicing vehicle for aircraft) must be used exclusively for the purposes described in item (3). Free income tax service In military aircraft (No. Free income tax service 16). Free income tax service   In a military aircraft means fuel used in an aircraft owned by the United States or any foreign nation and constituting a part of its armed forces. Free income tax service In commercial aviation (other than foreign trade). Free income tax service   See Commercial aviation, earlier, for the definition. Free income tax service Use in a train. Free income tax service   Use in a train means fuel used in the propulsion engine of equipment or machinery that rides on rails. Free income tax service This includes use in a locomotive, work train, switching engine, and track maintenance machine. Free income tax service Biodiesel or Renewable Diesel Mixture Credit, Alternative Fuel Credit, and Alternative Fuel Mixture Credit For alternative fuel mixtures produced after December 31, 2011, see How to Claim the Credit below. Free income tax service The section 6426 credit for biodiesel and alternative fuel consists of the biodiesel or renewable diesel mixture credit, alternative fuel credit, and alternative fuel mixture credit. Free income tax service Biodiesel or renewable diesel mixture credit claimant. Free income tax service   Claimant produced a biodiesel mixture by mixing biodiesel with diesel fuel. Free income tax service Claimant produced a renewable diesel mixture by mixing renewable diesel with liquid fuel (other than renewable diesel). Free income tax service   The person that produced and sold or used the mixture in their trade or business is the only person eligible to make this claim. Free income tax service The credit is based on the gallons of biodiesel or renewable diesel in the mixture. Free income tax service Renewable diesel does not include any fuel derived from coprocessing biomass (as defined in section 45K(c)(3)) with a feedstock that is not biomass. Free income tax service Claim requirements. Free income tax service   See the Instructions for Form 720 for the biodiesel or renewable diesel mixture claim requirements. Free income tax service Alternative fuel credit claimant. Free income tax service   For the alternative fuel credit, the registered alternative fueler who (1) sold an alternative fuel at retail delivered it into the fuel supply tank of a motor vehicle or motorboat, (2) sold an alternative fuel, delivered it in bulk taxable use in a motor vehicle or motorboat, and received required statement from the buyer, (3) used an alternative fuel (not sold at retail or in bulk as previously described) motor vehicle or motorboat, or (4) sold an alternative fuel used as a fuel in aviation is the only person eligible to make this claim. Free income tax service Carbon capture requirement. Free income tax service   A credit for Fischer-Tropsch process liquid fuel derived from coal (including peat) can be claimed only if the fuel is derived from coal produced at a gasification facility that separates and sequesters at least 75% of the facility's total carbon dioxide emissions. Free income tax service Alternative fuel credit. Free income tax service   The registered alternative fueler is the person eligible to make the claim. Free income tax service An alternative fueler is the person liable for tax on alternative fuel under the rules for taxable events for Other Fuels (discussed in chapter 1) or would be liable but for an exemption for nontaxable uses. Free income tax service An alternative fueler includes a person who sells for use or uses an alternative fuel in aviation. Free income tax service Alternative fuel mixture credit claimant. Free income tax service   For the alternative fuel mixture credit, the registered alternative fueler that produced and sold or used the mixture as a fuel in their trade or business is the only person eligible to make this claim. Free income tax service The credit is based on the gallons of alternative fuel in the mixture. Free income tax service An alternative fuel mixture is a mixture of alternative fuel and section 4081 taxable fuel (gasoline, diesel fuel, or kerosene). Free income tax service Registration. Free income tax service   You must be registered by the IRS to be eligible to claim the section 6426 fuel credit. Free income tax service See Registration Requirements in chapter 1. Free income tax service Credits for fuel provide incentive for United States production. Free income tax service   The section 6426 fuel credit may not be claimed for alternative fuel that is produced outside the United States for use as a fuel outside the United States. Free income tax service The United States includes any possession of the United States. Free income tax service Credit for fuels derived from paper or pulp production. Free income tax service   Credit for alternative fuels and alternative fuel mixtures for any fuel derived from the production of paper or pulp are not available for fuel sold or used on or after December 31, 2009. Free income tax service How to Claim the Credit Any biodiesel or renewable diesel mixture credit must first be claimed on Schedule C to reduce your taxable fuel liability reported on Form 720. Free income tax service Any excess credit may be claimed on Schedule C (Form 720), Schedule 3 (Form 8849), Form 4136, or Form 8864, Biodiesel and Renewable Diesel Fuels Credit. Free income tax service See Notice 2005-4 and the Instructions for Form 720 for more information. Free income tax service Also see Notice 2013-26 on page 984 of I. Free income tax service R. Free income tax service B. Free income tax service 2013-18 at www. Free income tax service irs. Free income tax service gov/pub/irs-irbs/irb13-18. Free income tax service pdf; and see chapter 2, later. Free income tax service Coordination with income tax credit. Free income tax service   Only one credit may be taken for any amount of biodiesel or renewable diesel. Free income tax service If any amount is claimed (or will be claimed) for any amount of biodiesel or renewable diesel on Form 720, Form 8849, or Form 4136, then a claim cannot be made on Form 8864 for that amount of biodiesel or renewable diesel. Free income tax service   Any alternative fuel credit must first be claimed on Schedule C (Form 720) to reduce your section 4041 taxable fuel liability for alternative fuel and CNG reported on Form 720. Free income tax service Any excess credit may claimed on Schedule C (Form 720), Schedule 3 (Form 8849), or Form 4136. Free income tax service   For alternative fuel mixtures produced after December 31, 2011, the alternative fuel mixture credit can be claimed on Schedule C (Form 720), not on Form 4136 or Schedule 3 (Form 8849), and only to the extent of your section 4081 taxable fuel liability for gasoline, diesel fuel and kerosene reported on Form 720. Free income tax service   Calculate the limitation for alternative fuel mixtures separately and enter on Schedule C (Form 720), line 14, only the gallons of mixtures that do not exceed your section 4081 taxable fuel liability. Free income tax service Filing Claims This section tells you how to make a claim for a credit or refund of excise taxes on fuels. Free income tax service This section also covers recordkeeping requirements and when to include the credit or refund in your income. Free income tax service Generally, you will provide all the information needed to claim a credit or refund when you properly complete Form 8849, Form 4136, Schedule C (Form 720), Form 6478, or Form 8864. Free income tax service In some cases, you will have to attach additional information. Free income tax service You need to keep records that support your claim for a credit or refund. Free income tax service Keep at your principal place of business all records needed to enable the IRS to verify that you are the person entitled to claim a credit or refund and the amount you claimed. Free income tax service Ultimate purchaser. Free income tax service   Ultimate purchasers may make claims for the nontaxable use of fuels on Form 4136, Schedule 1 (Form 8849), and Schedule C (Form 720) if reporting excise tax liability on that return. Free income tax service If you are an ultimate purchaser, you must keep the following records. Free income tax service The number of gallons purchased and used during the period covered by your claim. Free income tax service The dates of the purchases. Free income tax service The names and addresses of suppliers and amounts purchased from each in the period covered by your claim. Free income tax service The nontaxable use for which you used the fuel. Free income tax service The number of gallons used for each nontaxable use. Free income tax service It is important that your records show separately the number of gallons used for each nontaxable use that qualifies as a claim. Free income tax service If the fuel is exported, you must have proof of exportation. Free income tax service   For more information about keeping records, see Publication 583, Starting a Business and Keeping Records, or chapter 1 of Publication 17, Your Federal Income Tax for Individuals. Free income tax service Exceptions. Free income tax service    Generally, the ultimate purchaser may not claim a credit or refund for undyed diesel fuel, undyed kerosene, or kerosene for use in aviation sold for the exclusive use of a state or local government. Free income tax service However, see Claims by credit card issuers, later, for an exception. Free income tax service The ultimate purchaser may not claim a credit or refund as follows. Free income tax service The ultimate purchaser of gasoline or aviation gasoline used by a state or local government for its exclusive use or by a nonprofit educational organization for its exclusive use may waive its right to make a claim by providing a certificate that is signed under penalties of perjury by a person authorized to bind the ultimate purchaser and is in the same format as the Model Certificate M. Free income tax service A new certificate is required each year or when any information in the current certificate expires. Free income tax service The ultimate purchaser of kerosene for use in commercial aviation or noncommercial aviation (other than nonexempt, noncommercial aviation and exclusive use by a state, political subdivision of a state, or the District of Columbia) may waive its right to make a claim by providing a waiver that is signed under penalties of perjury by a person authorized to bind the ultimate purchaser and is in the same format as the Model Waiver L. Free income tax service A new waiver is required each year or when any information in the current waiver expires. Free income tax service The ultimate purchaser of undyed diesel fuel or undyed kerosene used in certain intercity and local buses may waive its right to make a claim by providing a waiver that is signed under penalties of perjury by a person authorized to bind the ultimate purchaser and is in the same format as the Model Waiver N. Free income tax service A new waiver is required each year or when any information in the current waiver expires. Free income tax service The ultimate purchaser of kerosene for use in nonexempt, noncommercial aviation must provide a certificate that is signed under penalties of perjury by a person authorized to bind the ultimate purchaser and is in the same format as the Model Certificate Q. Free income tax service A new certificate is required each year or when any information in the current certificate expires. Free income tax service Registered ultimate vendor. Free income tax service   Registered ultimate vendors may make claims for certain sales of fuels on Form 4136, Schedule 2 (Form 8849), and Schedule C (Form 720) if reporting excise tax liability on that return. Free income tax service If you are a registered ultimate vendor, you must keep certain information pertaining to the sale of the fuel. Free income tax service   To make a claim, you must have sold the fuel at a tax-excluded price, repaid the tax to the buyer, or obtained the buyer's written consent to the allowance of the claim. Free income tax service You are required to have a valid certificate or waiver in your possession in order to make the claim. Free income tax service   In addition, you must have a registration number that has not been revoked or suspended. Free income tax service See Form 637. Free income tax service State use. Free income tax service   To make a claim as an ultimate vendor (state), you must have a UV registration number and the fuel cannot be purchased with a credit card as explained below. Free income tax service If you sell undyed diesel fuel, undyed kerosene, or kerosene for use in aviation for use by a state or local government, you must keep the following information. Free income tax service The name and taxpayer identification number of each person (government unit) that bought the fuel. Free income tax service The number of gallons sold to each person. Free income tax service An unexpired certificate from the buyer. Free income tax service See Model Certificate P in the Appendix. Free income tax service The certificate expires on the earlier of 1 year after the date of the certificate or the date a new certificate is given to the registered ultimate vendor. Free income tax service Nonprofit educational organization and state use. Free income tax service   To make a claim as an ultimate vendor (nonprofit educational organization or state), you must have a UV registration number and the fuel cannot be purchased with a credit card as explained later. Free income tax service If you sell gasoline or aviation gasoline to a nonprofit educational organization for its exclusive use or to a state or local government for its exclusive use, you must keep the following information. Free income tax service The name and taxpayer identification number of each person (nonprofit educational organization or government unit) that bought the fuel. Free income tax service The number of gallons sold to each person. Free income tax service An unexpired certificate from the buyer. Free income tax service See Model Certificate M in the Appendix. Free income tax service  The certificate expires on the earlier of 1 year after the date of the certificate or the date a new certificate is given to the registered ultimate vendor. Free income tax service Blocked pump. Free income tax service   To make a claim as an ultimate vendor (blocked pump), you must have a UP registration number. Free income tax service If you sell undyed kerosene (other than kerosene for use in aviation) from a pump that qualifies as a blocked pump because it is locked by you after each sale and is unlocked by you at the request of the buyer, you must keep the following information for each sale of more than 5 gallons. Free income tax service The date of each sale. Free income tax service The name and address of the buyer. Free income tax service The number of gallons sold to that buyer. Free income tax service Certain intercity and local bus use. Free income tax service   To make a claim as an ultimate vendor of undyed diesel fuel or undyed kerosene used in certain intercity and local buses, you must have a UB registration number. Free income tax service You must keep the following information. Free income tax service The date of each sale. Free income tax service The name and address of the buyer. Free income tax service The number of gallons sold to the buyer. Free income tax service A copy of the waiver signed by the buyer at the time the credit or payment is claimed. Free income tax service See Model Waiver N in the Appendix. Free income tax service Kerosene for use in commercial aviation or noncommercial aviation. Free income tax service   To make a claim as an ultimate vendor of kerosene for use in commercial aviation (other than foreign trade) or noncommercial aviation (other than nonexempt, noncommercial aviation and exclusive use by a state, political subdivision of a state, or the District of Columbia), you must have a UA registration number. Free income tax service See Kerosene for use in aviation, earlier, for a list of nontaxable uses. Free income tax service You must keep the following information. Free income tax service The date of each sale. Free income tax service The name and address of the buyer. Free income tax service The number of gallons sold to the buyer. Free income tax service A copy of the waiver signed by the buyer at the time the credit or payment is claimed. Free income tax service See Model Waiver L in the Appendix. Free income tax service Kerosene for use in nonexempt, noncommercial aviation. Free income tax service   To make a claim as an ultimate vendor of kerosene for use in nonexempt, noncommercial aviation, you must have a UA registration number. Free income tax service You must keep the following information. Free income tax service The date of each sale. Free income tax service The name and address of the buyer. Free income tax service The number of gallons sold to the buyer. Free income tax service A copy of the certificate signed by the buyer at the time the credit or payment is claimed. Free income tax service See Model Certificate Q in the Appendix. Free income tax service Claims by credit card issuers. Free income tax service   For sales of gasoline, aviation gasoline, diesel fuel, kerosene, or kerosene for use in aviation that are purchased by an exempt user with the use of a credit card, the registered credit card issuer is the only person who can make the claim. Free income tax service An exempt user for this purpose is: For gasoline or aviation gasoline, a state or local government (including essential government use by an Indian tribal government) or a nonprofit educational organization; or For diesel fuel, kerosene, or kerosene for use in aviation, a state or local government (including essential government use by an Indian tribal government). Free income tax service   If gasoline is purchased without the use of a credit card, then the registered ultimate vendor of the gasoline may make the claim for refund or credit. Free income tax service However, if the gasoline is purchased with a credit card issued to a state, but the credit card issuer is not registered by the IRS or does not meet the conditions described, the credit card issuer must collect the tax and the state may make the claim. Free income tax service   If diesel fuel, kerosene, or kerosene for use in aviation is purchased without the use of a credit card, the registered ultimate vendor may make the claim for refund or credit. Free income tax service A state is not allowed to make a claim for these fuels. Free income tax service However, if the diesel fuel or kerosene is purchased with a credit card issued to a state, but the credit card issuer is not registered by the IRS or does not meet the conditions described, the credit card issuer must collect the tax and the state may make the claim. Free income tax service   The claim from the credit card issuer must contain the following information as it applies to the fuel covered in the claim. Free income tax service The total number of gallons. Free income tax service Its registration number. Free income tax service A statement that it has not collected the amount of tax from the ultimate purchaser or has obtained the written consent of the ultimate purchaser to make the claim. Free income tax service A statement that it has repaid or agreed to repay the amount of tax to the ultimate vendor, has obtained the written consent of the ultimate vendor to make the claim, or has otherwise made arrangements which directly or indirectly provide the ultimate vendor with reimbursement of the tax. Free income tax service Has in its possession an unexpired certificate similar to Model Certificate R in the Appendix and has no reason to believe any of the information in the certificate is false. Free income tax service Taxpayer identification number. Free income tax service   To file a claim, you must have a taxpayer identification number. Free income tax service Your taxpayer identification number can be an: Employer identification number (EIN), Social security number (SSN), or Individual taxpayer identification number (ITIN), if you are an alien individual and do not have and are not eligible to get an SSN. Free income tax service   If you normally file only a U. Free income tax service S. Free income tax service individual income tax return (such as Form 1040 or 1040NR), use your SSN or ITIN. Free income tax service You get an SSN by filing Form SS-5, Application for a Social Security Card, with the Social Security Administration. Free income tax service To get an ITIN, file Form W-7, Application for IRS Individual Taxpayer Identification Number, with the IRS. Free income tax service   If you operate a business, use your EIN. Free income tax service If you do not have an EIN, you may apply for one online. Free income tax service Go to the IRS website at irs. Free income tax service gov/businesses/small and click on the “Employer ID Numbers (EINs)” link. Free income tax service You may also apply for an EIN by calling 1-800-829-4933, or you can fax or mail Form SS-4, Application for Employer Identification Number, to the IRS. Free income tax service Claiming A Refund Generally, you may claim a refund of excise taxes on Form 8849. Free income tax service Complete and attach to Form 8849 the appropriate Form 8849 schedules. Free income tax service The instructions for Form 8849 and the separate instructions for each schedule explain the requirements for making a claim for refund. Free income tax service If you file Form 720, you can use the Schedule C (Form 720) for your refund claims for the quarter. Free income tax service See the Instructions for Form 720. Free income tax service Do not claim a refund on Form 8849 for any amount for which you have filed or will file a claim on Schedule C (Form 720) or Form 4136. Free income tax service The alternative fuel mixture credit must be claimed on Schedule C (Form 720) against your section 4081 taxable fuel liability for gasoline, diesel, and kerosene and any excess is not allowed. Free income tax service The alternative fuel credit must first be claimed on Schedule C (Form 720) against your section 4041 taxable fuel liability for alternative fuel and CNG. Free income tax service To the extent the alternative fuel credit exceeds this taxable fuel liability, a payment is allowed and may be claimed as a credit on Schedule C (Form 720), or as an income tax credit on Forms 4136, 6478, or 8864, as applicable. Free income tax service Only one claim may be made for any particular amount of alternative fuel. Free income tax service Claiming a Credit on Form 4136 For alternative fuel mixtures produced after December 31, 2011, the alternative fuel mixture credit cannot be claimed on Form 4136. Free income tax service See Biodiesel or Renewable Diesel Mixture Credit, Alternative Fuel Credit and Alternative Fuel Mixture Credit in chapter 2, earlier. Free income tax service A credit may be claimed for certain uses and sales of fuels on Form 4136 when you file your income tax return at the end of the year. Free income tax service If you meet certain requirements (discussed earlier), you may be able to make a claim during the year. Free income tax service Credit only. Free income tax service   You can claim the following taxes only as a credit on Form 4136. Free income tax service Tax on fuels used for nontaxable uses if the total for your tax year is less than $750. Free income tax service Tax on fuel you did not include in any claim for refund previously filed for any quarter of your tax year. Free income tax service Tax on fuel you used in mobile machinery (off-highway business use) that traveled less than 7,500 miles on public highways. Free income tax service Do not claim a credit for any amount for which you have filed a refund claim on Form 8849 or credit on Schedule C (Form 720). Free income tax service When to file. Free income tax service   You can claim a fuel tax credit on your income tax return for the year you used the fuel (or sold the fuel in the case of a registered ultimate vendor claim). Free income tax service You may be able to make a fuel tax claim on an amended income tax return for the year you used the fuel. Free income tax service Generally, you must file an amended return by the later of 3 years from the date you filed your original return or within 2 years from the date you paid the income tax. Free income tax service How to claim a credit. Free income tax service   How you claim a credit depends on whether you are an individual, partnership, corporation, S corporation, or farmers' cooperative association. Free income tax service Individuals. Free income tax service   You claim the credit on the “Credits from” line of Form 1040. Free income tax service Also check box b on that line. Free income tax service If you would not otherwise have to file an income tax return, you must do so to get a fuel tax credit. Free income tax service Partnerships. Free income tax service   Partnerships (other than electing large partnerships) claim the credit by including a statement on Schedule K-1 (Form 1065), Partner's Share of Income, Deductions, Credits, etc. Free income tax service , showing each partner's share of the number of gallons of each fuel sold or used for a non
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Many changes have taken, and are continuing to take place in the industry. Savvy consumers need to keep up with new rules, products, and services to make sure they are getting the best quality and taking advantage of the best offers.

Cable

You can start with a basic lineup of channels and go from there. The more channels you want, the more it will cost. You may want to consider video on demand so you can order movies and sports events and watch them when you like (usually within a 24-hour window). You can also buy a bundle of services that includes digital TV, digital phone and broadband Internet access at discounted rates. Bear in mind, however, that you may be asked to sign a contract for bundled services.

Satellite TV

This requires a dish that's mounted outside (service requires an unobstructed view of the satellite) and a receiver that's placed by your television. Satellite TV may offer more channels than cable TV, and you can add a digital video recorder to record shows for viewing later. One downside to satellite TV is occasional interference during periods of rain or snow. Check with your satellite TV provider for channel options and prices. Like cable TV, you may be asked to sign a contract for a package of services.

Internet TV

If you have a high-speed Internet connection, you're already able to watch thousands of videos on your computer. But movies and TV shows are also available and becoming more prevalent as large online companies start distributing TV programming.

The Free Income Tax Service

Free income tax service 8. Free income tax service   Business Expenses Table of Contents Introduction Useful Items - You may want to see: Bad DebtsAccrual method. Free income tax service Cash method. Free income tax service Car and Truck ExpensesOffice in the home. Free income tax service Methods for Deducting Car and Truck Expenses Reimbursing Your Employees for Expenses Depreciation Employees' PayFringe benefits. Free income tax service InsuranceHow to figure the deduction. Free income tax service Interest Legal and Professional FeesTax preparation fees. Free income tax service Pension Plans Rent Expense Taxes Travel, Meals, and EntertainmentTransportation. Free income tax service Taxi, commuter bus, and limousine. Free income tax service Baggage and shipping. Free income tax service Car or truck. Free income tax service Meals and lodging. Free income tax service Cleaning. Free income tax service Telephone. Free income tax service Tips. Free income tax service More information. Free income tax service Business Use of Your HomeExceptions to exclusive use. Free income tax service Other Expenses You Can Deduct Expenses You Cannot Deduct Introduction You can deduct the costs of operating your business. Free income tax service These costs are known as business expenses. Free income tax service These are costs you do not have to capitalize or include in the cost of goods sold but can deduct in the current year. Free income tax service To be deductible, a business expense must be both ordinary and necessary. Free income tax service An ordinary expense is one that is common and accepted in your field of business. Free income tax service A necessary expense is one that is helpful and appropriate for your business. Free income tax service An expense does not have to be indispensable to be considered necessary. Free income tax service For more information about the general rules for deducting business expenses, see chapter 1 in Publication 535, Business Expenses. Free income tax service If you have an expense that is partly for business and partly personal, separate the personal part from the business part. Free income tax service The personal part is not deductible. Free income tax service Useful Items - You may want to see: Publication 463 Travel, Entertainment, Gift, and Car Expenses 535 Business Expenses 946 How To Depreciate Property See chapter 12 for information about getting publications and forms. Free income tax service Bad Debts If someone owes you money you cannot collect, you have a bad debt. Free income tax service There are two kinds of bad debts, business bad debts and nonbusiness bad debts. Free income tax service A business bad debt is generally one that comes from operating your trade or business. Free income tax service You may be able to deduct business bad debts as an expense on your business tax return. Free income tax service Business bad debt. Free income tax service   A business bad debt is a loss from the worthlessness of a debt that was either of the following. Free income tax service Created or acquired in your business. Free income tax service Closely related to your business when it became partly or totally worthless. Free income tax service A debt is closely related to your business if your primary motive for incurring the debt is a business reason. Free income tax service   Business bad debts are mainly the result of credit sales to customers. Free income tax service They can also be the result of loans to suppliers, clients, employees, or distributors. Free income tax service Goods and services customers have not paid for are shown in your books as either accounts receivable or notes receivable. Free income tax service If you are unable to collect any part of these accounts or notes receivable, the uncollectible part is a business bad debt. Free income tax service    You can take a bad debt deduction for these accounts and notes receivable only if the amount you were owed was included in your gross income either for the year the deduction is claimed or for a prior year. Free income tax service Accrual method. Free income tax service   If you use an accrual method of accounting, you normally report income as you earn it. Free income tax service You can take a bad debt deduction for an uncollectible receivable if you have included the uncollectible amount in income. Free income tax service Cash method. Free income tax service   If you use the cash method of accounting, you normally report income when you receive payment. Free income tax service You cannot take a bad debt deduction for amounts owed to you that you have not received and cannot collect if you never included those amounts in income. Free income tax service More information. Free income tax service   For more information about business bad debts, see chapter 10 in Publication 535. Free income tax service Nonbusiness bad debts. Free income tax service   All other bad debts are nonbusiness bad debts and are deductible as short-term capital losses on Form 8949 and Schedule D (Form 1040). Free income tax service For more information on nonbusiness bad debts, see Publication 550, Investment Income and Expenses. Free income tax service Car and Truck Expenses If you use your car or truck in your business, you may be able to deduct the costs of operating and maintaining your vehicle. Free income tax service You also may be able to deduct other costs of local transportation and traveling away from home overnight on business. Free income tax service You may qualify for a tax credit for qualified plug-in electric vehicles, qualified plug-in electric drive motor vehicles, and alternative motor vehicles you place in service during the year. Free income tax service See Form 8936 and Form 8910 for more information. Free income tax service Local transportation expenses. Free income tax service   Local transportation expenses include the ordinary and necessary costs of all the following. Free income tax service Getting from one workplace to another in the course of your business or profession when you are traveling within the city or general area that is your tax home. Free income tax service Tax home is defined later. Free income tax service Visiting clients or customers. Free income tax service Going to a business meeting away from your regular workplace. Free income tax service Getting from your home to a temporary workplace when you have one or more regular places of work. Free income tax service These temporary workplaces can be either within the area of your tax home or outside that area. Free income tax service Local business transportation does not include expenses you have while traveling away from home overnight. Free income tax service Those expenses are deductible as travel expenses and are discussed later under Travel, Meals, and Entertainment. Free income tax service However, if you use your car while traveling away from home overnight, use the rules in this section to figure your car expense deduction. Free income tax service   Generally, your tax home is your regular place of business, regardless of where you maintain your family home. Free income tax service It includes the entire city or general area in which your business or work is located. Free income tax service Example. Free income tax service You operate a printing business out of rented office space. Free income tax service You use your van to deliver completed jobs to your customers. Free income tax service You can deduct the cost of round-trip transportation between your customers and your print shop. Free income tax service    You cannot deduct the costs of driving your car or truck between your home and your main or regular workplace. Free income tax service These costs are personal commuting expenses. Free income tax service Office in the home. Free income tax service   Your workplace can be your home if you have an office in your home that qualifies as your principal place of business. Free income tax service For more information, see Business Use of Your Home, later. Free income tax service Example. Free income tax service You are a graphics designer. Free income tax service You operate your business out of your home. Free income tax service Your home qualifies as your principal place of business. Free income tax service You occasionally have to drive to your clients to deliver your completed work. Free income tax service You can deduct the cost of the round-trip transportation between your home and your clients. Free income tax service Methods for Deducting Car and Truck Expenses For local transportation or overnight travel by car or truck, you generally can use one of the following methods to figure your expenses. Free income tax service Standard mileage rate. Free income tax service Actual expenses. Free income tax service Standard mileage rate. Free income tax service   You may be able to use the standard mileage rate to figure the deductible costs of operating your car, van, pickup, or panel truck for business purposes. Free income tax service For 2013, the standard mileage rate is 56. Free income tax service 5 cents per mile. Free income tax service    If you choose to use the standard mileage rate for a year, you cannot deduct your actual expenses for that year except for business-related parking fees and tolls. Free income tax service Choosing the standard mileage rate. Free income tax service   If you want to use the standard mileage rate for a car or truck you own, you must choose to use it in the first year the car is available for use in your business. Free income tax service In later years, you can choose to use either the standard mileage rate or actual expenses. Free income tax service   If you use the standard mileage rate for a car you lease, you must choose to use it for the entire lease period (including renewals). Free income tax service Standard mileage rate not allowed. Free income tax service   You cannot use the standard mileage rate if you: Operate five or more cars at the same time, Claimed a depreciation deduction using any method other than straight line, for example, ACRS or MACRS, Claimed a section 179 deduction on the car, Claimed the special depreciation allowance on the car, Claimed actual car expenses for a car you leased, or Are a rural mail carrier who received a qualified reimbursement. Free income tax service Parking fees and tolls. Free income tax service   In addition to using the standard mileage rate, you can deduct any business-related parking fees and tolls. Free income tax service (Parking fees you pay to park your car at your place of work are nondeductible commuting expenses. Free income tax service ) Actual expenses. Free income tax service   If you do not choose to use the standard mileage rate, you may be able to deduct your actual car or truck expenses. Free income tax service    If you qualify to use both methods, figure your deduction both ways to see which gives you a larger deduction. Free income tax service   Actual car expenses include the costs of the following items. Free income tax service Depreciation Lease payments Registration Garage rent Licenses Repairs Gas Oil Tires Insurance Parking fees Tolls   If you use your vehicle for both business and personal purposes, you must divide your expenses between business and personal use. Free income tax service You can divide your expenses based on the miles driven for each purpose. Free income tax service Example. Free income tax service You are the sole proprietor of a flower shop. Free income tax service You drove your van 20,000 miles during the year. Free income tax service 16,000 miles were for delivering flowers to customers and 4,000 miles were for personal use (including commuting miles). Free income tax service You can claim only 80% (16,000 ÷ 20,000) of the cost of operating your van as a business expense. Free income tax service More information. Free income tax service   For more information about the rules for claiming car and truck expenses, see Publication 463. Free income tax service Reimbursing Your Employees for Expenses You generally can deduct the amount you reimburse your employees for car and truck expenses. Free income tax service The reimbursement you deduct and the manner in which you deduct it depend in part on whether you reimburse the expenses under an accountable plan or a nonaccountable plan. Free income tax service For details, see chapter 11 in Publication 535. Free income tax service That chapter explains accountable and nonaccountable plans and tells you whether to report the reimbursement on your employee's Form W-2, Wage and Tax Statement. Free income tax service Depreciation If property you acquire to use in your business is expected to last more than 1 year, you generally cannot deduct the entire cost as a business expense in the year you acquire it. Free income tax service You must spread the cost over more than 1 tax year and deduct part of it each year on Schedule C. Free income tax service This method of deducting the cost of business property is called depreciation. Free income tax service The discussion here is brief. Free income tax service You will find more information about depreciation in Publication 946. Free income tax service What property can be depreciated?   You can depreciate property if it meets all the following requirements. Free income tax service It must be property you own. Free income tax service It must be used in business or held to produce income. Free income tax service You never can depreciate inventory (explained in chapter 2) because it is not held for use in your business. Free income tax service It must have a useful life that extends substantially beyond the year it is placed in service. Free income tax service It must have a determinable useful life, which means that it must be something that wears out, decays, gets used up, becomes obsolete, or loses its value from natural causes. Free income tax service You never can depreciate the cost of land because land does not wear out, become obsolete, or get used up. Free income tax service It must not be excepted property. Free income tax service This includes property placed in service and disposed of in the same year. Free income tax service Repairs. Free income tax service    You cannot depreciate repairs and replacements that do not increase the value of your property, make it more useful, or lengthen its useful life. Free income tax service You can deduct these amounts on line 21 of Schedule C or line 2 of Schedule C-EZ. Free income tax service Depreciation method. Free income tax service   The method for depreciating most business and investment property placed in service after 1986 is called the Modified Accelerated Cost Recovery System (MACRS). Free income tax service MACRS is discussed in detail in Publication 946. Free income tax service Section 179 deduction. Free income tax service   You can elect to deduct a limited amount of the cost of certain depreciable property in the year you place the property in service. Free income tax service This deduction is known as the “section 179 deduction. Free income tax service ” The maximum amount you can elect to deduct during 2013 is generally $500,000 (higher limits apply to certain property). Free income tax service See IRC 179(e). Free income tax service   This limit is generally reduced by the amount by which the cost of the property placed in service during the tax year exceeds $2 million. Free income tax service The total amount of depreciation (including the section 179 deduction) you can take for a passenger automobile you use in your business and first place in service in 2013 is $3,160 ($11,160 if you take the special depreciation allowance for qualified passenger automobiles placed in service in 2013). Free income tax service Special rules apply to trucks and vans. Free income tax service For more information, see Publication 946. Free income tax service It explains what property qualifies for the deduction, what limits apply to the deduction, and when and how to recapture the deduction. Free income tax service    Your section 179 election for the cost of any sport utility vehicle (SUV) and certain other vehicles is limited to $25,000. Free income tax service For more information, see the Instructions for Form 4562 or Publication 946. Free income tax service Listed property. Free income tax service   You must follow special rules and recordkeeping requirements when depreciating listed property. Free income tax service Listed property is any of the following. Free income tax service Most passenger automobiles. Free income tax service Most other property used for transportation. Free income tax service Any property of a type generally used for entertainment, recreation, or amusement. Free income tax service Certain computers and related peripheral equipment. Free income tax service   For more information about listed property, see Publication 946. Free income tax service Form 4562. Free income tax service   Use Form 4562, Depreciation and Amortization, if you are claiming any of the following. Free income tax service Depreciation on property placed in service during the current tax year. Free income tax service A section 179 deduction. Free income tax service Depreciation on any listed property (regardless of when it was placed in service). Free income tax service    If you have to use Form 4562, you must file Schedule C. Free income tax service You cannot use Schedule C-EZ. Free income tax service   Employees' Pay You can generally deduct on Schedule C the pay you give your employees for the services they perform for your business. Free income tax service The pay may be in cash, property, or services. Free income tax service To be deductible, your employees' pay must be an ordinary and necessary expense and you must pay or incur it in the tax year. Free income tax service In addition, the pay must meet both the following tests. Free income tax service The pay must be reasonable. Free income tax service The pay must be for services performed. Free income tax service Chapter 2 in Publication 535 explains and defines these requirements. Free income tax service You cannot deduct your own salary or any personal withdrawals you make from your business. Free income tax service As a sole proprietor, you are not an employee of the business. Free income tax service If you had employees during the year, you must use Schedule C. Free income tax service You cannot use Schedule C-EZ. Free income tax service Kinds of pay. Free income tax service   Some of the ways you may provide pay to your employees are listed below. Free income tax service For an explanation of each of these items, see chapter 2 in Publication 535. Free income tax service Awards. Free income tax service Bonuses. Free income tax service Education expenses. Free income tax service Fringe benefits (discussed later). Free income tax service Loans or advances you do not expect the employee to repay if they are for personal services actually performed. Free income tax service Property you transfer to an employee as payment for services. Free income tax service Reimbursements for employee business expenses. Free income tax service Sick pay. Free income tax service Vacation pay. Free income tax service Fringe benefits. Free income tax service   A fringe benefit is a form of pay for the performance of services. Free income tax service The following are examples of fringe benefits. Free income tax service Benefits under qualified employee benefit programs. Free income tax service Meals and lodging. Free income tax service The use of a car. Free income tax service Flights on airplanes. Free income tax service Discounts on property or services. Free income tax service Memberships in country clubs or other social clubs. Free income tax service Tickets to entertainment or sporting events. Free income tax service   Employee benefit programs include the following. Free income tax service Accident and health plans. Free income tax service Adoption assistance. Free income tax service Cafeteria plans. Free income tax service Dependent care assistance. Free income tax service Educational assistance. Free income tax service Group-term life insurance coverage. Free income tax service Welfare benefit funds. Free income tax service   You can generally deduct the cost of fringe benefits you provide on your Schedule C in whatever category the cost falls. Free income tax service For example, if you allow an employee to use a car or other property you lease, deduct the cost of the lease as a rent or lease expense. Free income tax service If you own the property, include your deduction for its cost or other basis as a section 179 deduction or a depreciation deduction. Free income tax service    You may be able to exclude all or part of the fringe benefits you provide from your employees' wages. Free income tax service For more information about fringe benefits and the exclusion of benefits, see Publication 15-B, Employer's Tax Guide to Fringe Benefits. Free income tax service Insurance You can generally deduct premiums you pay for the following kinds of insurance related to your business. Free income tax service Fire, theft, flood, or similar insurance. Free income tax service Credit insurance that covers losses from business bad debts. Free income tax service Group hospitalization and medical insurance for employees, including long-term care insurance. Free income tax service Liability insurance. Free income tax service Malpractice insurance that covers your personal liability for professional negligence resulting in injury or damage to patients or clients. Free income tax service Workers' compensation insurance set by state law that covers any claims for bodily injuries or job-related diseases suffered by employees in your business, regardless of fault. Free income tax service Contributions to a state unemployment insurance fund are deductible as taxes if they are considered taxes under state law. Free income tax service Overhead insurance that pays for business overhead expenses you have during long periods of disability caused by your injury or sickness. Free income tax service Car and other vehicle insurance that covers vehicles used in your business for liability, damages, and other losses. Free income tax service If you operate a vehicle partly for personal use, deduct only the part of the insurance premium that applies to the business use of the vehicle. Free income tax service If you use the standard mileage rate to figure your car expenses, you cannot deduct any car insurance premiums. Free income tax service Life insurance covering your employees if you are not directly or indirectly the beneficiary under the contract. Free income tax service Business interruption insurance that pays for lost profits if your business is shut down due to a fire or other cause. Free income tax service Nondeductible premiums. Free income tax service   You cannot deduct premiums on the following kinds of insurance. Free income tax service Self-insurance reserve funds. Free income tax service You cannot deduct amounts credited to a reserve set up for self-insurance. Free income tax service This applies even if you cannot get business insurance coverage for certain business risks. Free income tax service However, your actual losses may be deductible. Free income tax service For more information, see Publication 547, Casualties, Disasters, and Thefts. Free income tax service Loss of earnings. Free income tax service You cannot deduct premiums for a policy that pays for your lost earnings due to sickness or disability. Free income tax service However, see item (8) in the previous list. Free income tax service Certain life insurance and annuities. Free income tax service For contracts issued before June 9, 1997, you cannot deduct the premiums on a life insurance policy covering you, an employee, or any person with a financial interest in your business if you are directly or indirectly a beneficiary of the policy. Free income tax service You are included among possible beneficiaries of the policy if the policy owner is obligated to repay a loan from you using the proceeds of the policy. Free income tax service A person has a financial interest in your business if the person is an owner or part owner of the business or has lent money to the business. Free income tax service For contracts issued after June 8, 1997, you generally cannot deduct the premiums on any life insurance policy, endowment contract, or annuity contract if you are directly or indirectly a beneficiary. Free income tax service The disallowance applies without regard to whom the policy covers. Free income tax service Insurance to secure a loan. Free income tax service If you take out a policy on your life or on the life of another person with a financial interest in your business to get or protect a business loan, you cannot deduct the premiums as a business expense. Free income tax service Nor can you deduct the premiums as interest on business loans or as an expense of financing loans. Free income tax service In the event of death, the proceeds of the policy are not taxed as income even if they are used to liquidate the debt. Free income tax service Self-employed health insurance deduction. Free income tax service   You may be able to deduct the amount you paid for medical and dental insurance and qualified long-term care insurance for you and your family. Free income tax service How to figure the deduction. Free income tax service   Generally, you can use the worksheet in the Form 1040 instructions to figure your deduction. Free income tax service However, if any of the following apply, you must use the worksheet in chapter 6 of Publication 535. Free income tax service You have more than one source of income subject to self-employment tax. Free income tax service You file Form 2555 or Form 2555-EZ (relating to foreign earned income). Free income tax service You are using amounts paid for qualified long-term care insurance to figure the deduction. Free income tax service Prepayment. Free income tax service   You cannot deduct expenses in advance, even if you pay them in advance. Free income tax service This rule applies to any expense paid far enough in advance to, in effect, create an asset with a useful life extending substantially beyond the end of the current tax year. Free income tax service Example. Free income tax service In 2013, you signed a 3-year insurance contract. Free income tax service Even though you paid the premiums for 2013, 2014, and 2015 when you signed the contract, you can only deduct the premium for 2013 on your 2013 tax return. Free income tax service You can deduct in 2014 and 2015 the premium allocable to those years. Free income tax service More information. Free income tax service   For more information about deducting insurance, see chapter 6 in Publication 535. Free income tax service Interest You can generally deduct as a business expense all interest you pay or accrue during the tax year on debts related to your business. Free income tax service Interest relates to your business if you use the proceeds of the loan for a business expense. Free income tax service It does not matter what type of property secures the loan. Free income tax service You can deduct interest on a debt only if you meet all of the following requirements. Free income tax service You are legally liable for that debt. Free income tax service Both you and the lender intend that the debt be repaid. Free income tax service You and the lender have a true debtor-creditor relationship. Free income tax service You cannot deduct on Schedule C or C-EZ the interest you paid on personal loans. Free income tax service If a loan is part business and part personal, you must divide the interest between the personal part and the business part. Free income tax service Example. Free income tax service In 2013, you paid $600 interest on a car loan. Free income tax service During 2013, you used the car 60% for business and 40% for personal purposes. Free income tax service You are claiming actual expenses on the car. Free income tax service You can only deduct $360 (60% × $600) for 2013 on Schedule C or C-EZ. Free income tax service The remaining interest of $240 is a nondeductible personal expense. Free income tax service More information. Free income tax service   For more information about deducting interest, see chapter 4 in Publication 535. Free income tax service That chapter explains the following items. Free income tax service Interest you can deduct. Free income tax service Interest you cannot deduct. Free income tax service How to allocate interest between personal and business use. Free income tax service When to deduct interest. Free income tax service The rules for a below-market interest rate loan. Free income tax service (This is generally a loan on which no interest is charged or on which interest is charged at a rate below the applicable federal rate. Free income tax service ) Legal and Professional Fees Legal and professional fees, such as fees charged by accountants, that are ordinary and necessary expenses directly related to operating your business are deductible on Schedule C or C-EZ. Free income tax service However, you usually cannot deduct legal fees you pay to acquire business assets. Free income tax service Add them to the basis of the property. Free income tax service If the fees include payments for work of a personal nature (such as making a will), you can take a business deduction only for the part of the fee related to your business. Free income tax service The personal part of legal fees for producing or collecting taxable income, doing or keeping your job, or for tax advice may be deductible on Schedule A (Form 1040) if you itemize deductions. Free income tax service For more information, see Publication 529, Miscellaneous Deductions. Free income tax service Tax preparation fees. Free income tax service   You can deduct on Schedule C or C-EZ the cost of preparing that part of your tax return relating to your business as a sole proprietor or statutory employee. Free income tax service You can deduct the remaining cost on Schedule A (Form 1040) if you itemize your deductions. Free income tax service   You can also deduct on Schedule C or C-EZ the amount you pay or incur in resolving asserted tax deficiencies for your business as a sole proprietor or statutory employee. Free income tax service Pension Plans You can set up and maintain the following small business retirement plans for yourself and your employees. Free income tax service SEP (Simplified Employee Pension) plans. Free income tax service SIMPLE (Savings Incentive Match Plan for Employees) plans. Free income tax service Qualified plans (including Keogh or H. Free income tax service R. Free income tax service 10 plans). Free income tax service SEP, SIMPLE, and qualified plans offer you and your employees a tax favored way to save for retirement. Free income tax service You can deduct contributions you make to the plan for your employees on line 19 of Schedule C. Free income tax service If you are a sole proprietor, you can deduct contributions you make to the plan for yourself on line 28 of Form 1040. Free income tax service You can also deduct trustees' fees if contributions to the plan do not cover them. Free income tax service Earnings on the contributions are generally tax free until you or your employees receive distributions from the plan. Free income tax service You may also be able to claim a tax credit of 50% of the first $1,000 of qualified startup costs if you begin a new qualified defined benefit or defined contribution plan (including a 401(k) plan), SIMPLE plan, or simplified employee pension. Free income tax service Under certain plans, employees can have you contribute limited amounts of their before-tax pay to a plan. Free income tax service These amounts (and earnings on them) are generally tax free until your employees receive distributions from the plan. Free income tax service For more information on retirement plans for small business, see Publication 560, Retirement Plans for Small Business (SEP, SIMPLE, and Qualified Plans). Free income tax service Publication 590, Individual Retirement Arrangements (IRAs), discusses other tax favored ways to save for retirement. Free income tax service Rent Expense Rent is any amount you pay for the use of property you do not own. Free income tax service In general, you can deduct rent as a business expense only if the rent is for property you use in your business. Free income tax service If you have or will receive equity in or title to the property, you cannot deduct the rent. Free income tax service Unreasonable rent. Free income tax service   You cannot take a rental deduction for unreasonable rents. Free income tax service Ordinarily, the issue of reasonableness arises only if you and the lessor are related. Free income tax service Rent paid to a related person is reasonable if it is the same amount you would pay to a stranger for use of the same property. Free income tax service Rent is not unreasonable just because it is figured as a percentage of gross receipts. Free income tax service   Related persons include members of your immediate family, including only brothers and sisters (either whole or half), your spouse, ancestors, and lineal descendants. Free income tax service For a list of the other related persons, see section 267 of the Internal Revenue Code. Free income tax service Rent on your home. Free income tax service   If you rent your home and use part of it as your place of business, you may be able to deduct the rent you pay for that part. Free income tax service You must meet the requirements for business use of your home. Free income tax service For more information, see Business Use of Your Home , later. Free income tax service Rent paid in advance. Free income tax service   Generally, rent paid in your business is deductible in the year paid or accrued. Free income tax service If you pay rent in advance, you can deduct only the amount that applies to your use of the rented property during the tax year. Free income tax service You can deduct the rest of your payment only over the period to which it applies. Free income tax service More information. Free income tax service   For more information about rent, see chapter 3 in Publication 535. Free income tax service Taxes You can deduct on Schedule C or C-EZ various federal, state, local, and foreign taxes directly attributable to your business. Free income tax service Income taxes. Free income tax service   You can deduct on Schedule C or C-EZ a state tax on gross income (as distinguished from net income) directly attributable to your business. Free income tax service You can deduct other state and local income taxes on Schedule A (Form 1040) if you itemize your deductions. Free income tax service Do not deduct federal income tax. Free income tax service Employment taxes. Free income tax service   You can deduct the social security, Medicare, and federal unemployment (FUTA) taxes you paid out of your own funds as an employer. Free income tax service Employment taxes are discussed briefly in chapter 1. Free income tax service You can also deduct payments you made as an employer to a state unemployment compensation fund or to a state disability benefit fund. Free income tax service Deduct these payments as taxes. Free income tax service Self-employment tax. Free income tax service   You can deduct one-half of your self-employment tax on line 27 of Form 1040. Free income tax service Self-employment tax is discussed in chapters 1 and 10. Free income tax service Personal property tax. Free income tax service   You can deduct on Schedule C or C-EZ any tax imposed by a state or local government on personal property used in your business. Free income tax service   You can also deduct registration fees for the right to use property within a state or local area. Free income tax service Example. Free income tax service May and Julius Winter drove their car 7,000 business miles out of a total of 10,000 miles. Free income tax service They had to pay $25 for their annual state license tags and $20 for their city registration sticker. Free income tax service They also paid $235 in city personal property tax on the car, for a total of $280. Free income tax service They are claiming their actual car expenses. Free income tax service Because they used the car 70% for business, they can deduct 70% of the $280, or $196, as a business expense. Free income tax service Real estate taxes. Free income tax service   You can deduct on Schedule C or C-EZ the real estate taxes you pay on your business property. Free income tax service Deductible real estate taxes are any state, local, or foreign taxes on real estate levied for the general public welfare. Free income tax service The taxing authority must base the taxes on the assessed value of the real estate and charge them uniformly against all property under its jurisdiction. Free income tax service   For more information about real estate taxes, see chapter 5 in Publication 535. Free income tax service That chapter explains special rules for deducting the following items. Free income tax service Taxes for local benefits, such as those for sidewalks, streets, water mains, and sewer lines. Free income tax service Real estate taxes when you buy or sell property during the year. Free income tax service Real estate taxes if you use an accrual method of accounting and choose to accrue real estate tax related to a definite period ratably over that period. Free income tax service Sales tax. Free income tax service   Treat any sales tax you pay on a service or on the purchase or use of property as part of the cost of the service or property. Free income tax service If the service or the cost or use of the property is a deductible business expense, you can deduct the tax as part of that service or cost. Free income tax service If the property is merchandise bought for resale, the sales tax is part of the cost of the merchandise. Free income tax service If the property is depreciable, add the sales tax to the basis for depreciation. Free income tax service For information on the basis of property, see Publication 551, Basis of Assets. Free income tax service    Do not deduct state and local sales taxes imposed on the buyer that you must collect and pay over to the state or local government. Free income tax service Do not include these taxes in gross receipts or sales. Free income tax service Excise taxes. Free income tax service   You can deduct on Schedule C or C-EZ all excise taxes that are ordinary and necessary expenses of carrying on your business. Free income tax service Excise taxes are discussed briefly in chapter 1. Free income tax service Fuel taxes. Free income tax service   Taxes on gasoline, diesel fuel, and other motor fuels you use in your business are usually included as part of the cost of the fuel. Free income tax service Do not deduct these taxes as a separate item. Free income tax service   You may be entitled to a credit or refund for federal excise tax you paid on fuels used for certain purposes. Free income tax service For more information, see Publication 510, Excise Taxes. Free income tax service Travel, Meals, and Entertainment This section briefly explains the kinds of travel and entertainment expenses you can deduct on Schedule C or C-EZ. Free income tax service Table 8-1. Free income tax service When Are Entertainment Expenses Deductible? (Note. Free income tax service The following is a summary of the rules for deducting entertainment expenses. Free income tax service For more details about these rules, see Publication 463. Free income tax service ) General rule You can deduct ordinary and necessary expenses to entertain a client, customer, or employee if the expenses meet the directly-related test or the associated test. Free income tax service Definitions Entertainment includes any activity generally considered to provide entertainment, amusement, or recreation, and includes meals provided to a customer or client. Free income tax service An ordinary expense is one that is common and accepted in your field of business, trade, or profession. Free income tax service A necessary expense is one that is helpful and appropriate, although not necessarily required, for your business. Free income tax service Tests to be met Directly-related test Entertainment took place in a clear business setting, or Main purpose of entertainment was the active conduct of business, and You did engage in business with the person during the entertainment period, and You had more than a general expectation of getting income or some other specific business benefit. Free income tax service   Associated test Entertainment is associated with your trade or business, and Entertainment directly precedes or follows a substantial business discussion. Free income tax service Other rules You cannot deduct the cost of your meal as an entertainment expense if you are claiming the meal as a travel expense. Free income tax service You cannot deduct expenses that are lavish or extravagant under the circumstances. Free income tax service You generally can deduct only 50% of your unreimbursed entertainment expenses. Free income tax service Travel expenses. Free income tax service   These are the ordinary and necessary expenses of traveling away from home for your business. Free income tax service You are traveling away from home if both the following conditions are met. Free income tax service Your duties require you to be away from the general area of your tax home (defined later) substantially longer than an ordinary day's work. Free income tax service You need to get sleep or rest to meet the demands of your work while away from home. Free income tax service Generally, your tax home is your regular place of business, regardless of where you maintain your family home. Free income tax service It includes the entire city or general area in which your business is located. Free income tax service See Publication 463 for more information. Free income tax service   The following is a brief discussion of the expenses you can deduct. Free income tax service Transportation. Free income tax service   You can deduct the cost of travel by airplane, train, bus, or car between your home and your business destination. Free income tax service Taxi, commuter bus, and limousine. Free income tax service   You can deduct fares for these and other types of transportation between the airport or station and your hotel, or between the hotel and your work location away from home. Free income tax service Baggage and shipping. Free income tax service   You can deduct the cost of sending baggage and sample or display material between your regular and temporary work locations. Free income tax service Car or truck. Free income tax service   You can deduct the costs of operating and maintaining your vehicle when traveling away from home on business. Free income tax service You can deduct actual expenses or the standard mileage rate (discussed earlier under Car and Truck Expenses), as well as business-related tolls and parking. Free income tax service If you rent a car while away from home on business, you can deduct only the business-use portion of the expenses. Free income tax service Meals and lodging. Free income tax service   You can deduct the cost of meals and lodging if your business trip is overnight or long enough that you need to stop for sleep or rest to properly perform your duties. Free income tax service In most cases, you can deduct only 50% of your meal expenses. Free income tax service Cleaning. Free income tax service   You can deduct the costs of dry cleaning and laundry while on your business trip. Free income tax service Telephone. Free income tax service   You can deduct the cost of business calls while on your business trip, including business communication by fax machine or other communication devices. Free income tax service Tips. Free income tax service   You can deduct the tips you pay for any expense in this list. Free income tax service More information. Free income tax service   For more information about travel expenses, see Publication 463. Free income tax service Entertainment expenses. Free income tax service   You may be able to deduct business-related entertainment expenses for entertaining a client, customer, or employee. Free income tax service In most cases, you can deduct only 50% of these expenses. Free income tax service   The following are examples of entertainment expenses. Free income tax service Entertaining guests at nightclubs, athletic clubs, theaters, or sporting events. Free income tax service Providing meals, a hotel suite, or a car to business customers or their families. Free income tax service To be deductible, the expenses must meet the rules listed in Table 8-1. Free income tax service For details about these rules, see Publication 463. Free income tax service Reimbursing your employees for expenses. Free income tax service   You generally can deduct the amount you reimburse your employees for travel and entertainment expenses. Free income tax service The reimbursement you deduct and the manner in which you deduct it depend in part on whether you reimburse the expenses under an accountable plan or a nonaccountable plan. Free income tax service For details, see chapter 11 in Publication 535. Free income tax service That chapter explains accountable and nonaccountable plans and tells you whether to report the reimbursement on your employee's Form W-2, Wage and Tax Statement. Free income tax service Business Use of Your Home To deduct expenses related to the part of your home used for business, you must meet specific requirements. Free income tax service Even then, your deduction may be limited. Free income tax service To qualify to claim expenses for business use of your home, you must meet the following tests. Free income tax service Your use of the business part of your home must be: Exclusive (however, see Exceptions to exclusive use , later), Regular, For your business, and The business part of your home must be one of the following: Your principal place of business (defined later), A place where you meet or deal with patients, clients, or customers in the normal course of your business, or A separate structure (not attached to your home) you use in connection with your business. Free income tax service Exclusive use. Free income tax service   To qualify under the exclusive use test, you must use a specific area of your home only for your trade or business. Free income tax service The area used for business can be a room or other separately identifiable space. Free income tax service The space does not need to be marked off by a permanent partition. Free income tax service   You do not meet the requirements of the exclusive use test if you use the area in question both for business and for personal purposes. Free income tax service Example. Free income tax service You are an attorney and use a den in your home to write legal briefs and prepare clients' tax returns. Free income tax service Your family also uses the den for recreation. Free income tax service The den is not used exclusively in your profession, so you cannot claim a business deduction for its use. Free income tax service Exceptions to exclusive use. Free income tax service   You do not have to meet the exclusive use test if you use part of your home in either of the following ways. Free income tax service For the storage of inventory or product samples. Free income tax service As a daycare facility. Free income tax service For an explanation of these exceptions, see Publication 587, Business Use of Your Home (Including Use by Daycare Providers). Free income tax service Regular use. Free income tax service   To qualify under the regular use test, you must use a specific area of your home for business on a continuing basis. Free income tax service You do not meet the test if your business use of the area is only occasional or incidental, even if you do not use that area for any other purpose. Free income tax service Principal place of business. Free income tax service   You can have more than one business location, including your home, for a single trade or business. Free income tax service To qualify to deduct the expenses for the business use of your home under the principal place of business test, your home must be your principal place of business for that business. Free income tax service To determine your principal place of business, you must consider all the facts and circumstances. Free income tax service   Your home office will qualify as your principal place of business for deducting expenses for its use if you meet the following requirements. Free income tax service You use it exclusively and regularly for administrative or management activities of your business. Free income tax service You have no other fixed location where you conduct substantial administrative or management activities of your business. Free income tax service   Alternatively, if you use your home exclusively and regularly for your business, but your home office does not qualify as your principal place of business based on the previous rules, you determine your principal place of business based on the following factors. Free income tax service The relative importance of the activities performed at each location. Free income tax service If the relative importance factor does not determine your principal place of business, you can also consider the time spent at each location. Free income tax service   If, after considering your business locations, your home cannot be identified as your principal place of business, you cannot deduct home office expenses. Free income tax service However, for other ways to qualify to deduct home office expenses, see Publication 587. Free income tax service Deduction limit. Free income tax service   If your gross income from the business use of your home equals or exceeds your total business expenses (including depreciation), you can deduct all your business expenses related to the use of your home. Free income tax service If your gross income from the business use is less than your total business expenses, your deduction for certain expenses for the business use of your home is limited. Free income tax service   Your deduction of otherwise nondeductible expenses, such as insurance, utilities, and depreciation (with depreciation taken last), allocable to the business is limited to the gross income from the business use of your home minus the sum of the following. Free income tax service The business part of expenses you could deduct even if you did not use your home for business (such as mortgage interest, real estate taxes, and casualty and theft losses that are allowable as itemized deductions on Schedule A (Form 1040)). Free income tax service The business expenses that relate to the business activity in the home (for example, business phone, supplies, and depreciation on equipment), but not to the use of the home itself. Free income tax service Do not include in (2) above your deduction for one-half of your self-employment tax. Free income tax service   Use Form 8829, Expenses for Business Use of Your Home, to figure your deduction. Free income tax service New simplified method. Free income tax service    The IRS now provides a simplified method to determine your expenses for business use of your home. Free income tax service The simplified method is an alternative to calculating and substantiating actual expenses. Free income tax service In most cases, you will figure your deduction by multiplying $5 by the area of your home used for a qualified business use. Free income tax service The area you use to figure your deduction is limited to 300 square feet. Free income tax service For more information, see the Instructions for Schedule C. Free income tax service More information. Free income tax service   For more information on deducting expenses for the business use of your home, see Publication 587. Free income tax service Other Expenses You Can Deduct You may also be able to deduct the following expenses. Free income tax service See Publication 535 to find out whether you can deduct them. Free income tax service Advertising. Free income tax service Bank fees. Free income tax service Donations to business organizations. Free income tax service Education expenses. Free income tax service Energy efficient commercial buildings deduction expenses. Free income tax service Impairment-related expenses. Free income tax service Interview expense allowances. Free income tax service Licenses and regulatory fees. Free income tax service Moving machinery. Free income tax service Outplacement services. Free income tax service Penalties and fines you pay for late performance or nonperformance of a contract. Free income tax service Repairs that keep your property in a normal efficient operating condition. Free income tax service Repayments of income. Free income tax service Subscriptions to trade or professional publications. Free income tax service Supplies and materials. Free income tax service Utilities. Free income tax service Expenses You Cannot Deduct You usually cannot deduct the following as business expenses. Free income tax service For more information, see Publication 535. Free income tax service Bribes and kickbacks. Free income tax service Charitable contributions. Free income tax service Demolition expenses or losses. Free income tax service Dues to business, social, athletic, luncheon, sporting, airline, and hotel clubs. Free income tax service Lobbying expenses. Free income tax service Penalties and fines you pay to a governmental agency or instrumentality because you broke the law. Free income tax service Personal, living, and family expenses. Free income tax service Political contributions. Free income tax service Repairs that add to the value of your property or significantly increase its life. Free income tax service Prev  Up  Next   Home   More Online Publications