File your Taxes for Free!
  • Get your maximum refund*
  • 100% accurate calculations guaranteed*

TurboTax Federal Free Edition - File Taxes Online

Don't let filing your taxes get you down! We'll help make it as easy as possible. With e-file and direct deposit, there's no faster way to get your refund!

Approved TurboTax Affiliate Site. TurboTax and TurboTax Online, among others, are registered trademarks and/or service marks of Intuit Inc. in the United States and other countries. Other parties' trademarks or service marks are the property of the respective owners.


© 2012 - 2018 All rights reserved.

This is an Approved TurboTax Affiliate site. TurboTax and TurboTax Online, among other are registered trademarks and/or service marks of Intuit, Inc. in the United States and other countries. Other parties' trademarks or service marks are the property of the respective owners.
When discussing "Free e-file", note that state e-file is an additional fee. E-file fees do not apply to New York state returns. Prices are subject to change without notice. E-file and get your refund faster
*If you pay an IRS or state penalty or interest because of a TurboTax calculations error, we'll pay you the penalty and interest.
*Maximum Refund Guarantee - or Your Money Back: If you get a larger refund or smaller tax due from another tax preparation method, we'll refund the applicable TurboTax federal and/or state purchase price paid. TurboTax Federal Free Edition customers are entitled to payment of $14.99 and a refund of your state purchase price paid. Claims must be submitted within sixty (60) days of your TurboTax filing date and no later than 6/15/14. E-file, Audit Defense, Professional Review, Refund Transfer and technical support fees are excluded. This guarantee cannot be combined with the TurboTax Satisfaction (Easy) Guarantee. *We're so confident your return will be done right, we guarantee it. Accurate calculations guaranteed. If you pay an IRS or state penalty or interest because of a TurboTax calculations error, we'll pay you the penalty and interest.
https://turbotax.intuit.com/corp/guarantees.jsp

Freetaxusa2012

How To Fill Out A 1040xIrs Tax FormsFree State Tax Filing Online State ReturnIrs Gov Ez FormFile An Amended Tax Return Online FreeTurbotax Free Edition2009 1040 FormH And R Block Free Tax PreparationHow To File An Amended Tax ReturnFree Filing For State Taxes2012 Tax AmendmentAmmended Tax FormFile 1040ez FreeTax Forms For 2009Turbotax Free For Military1040ez Tax Forms Downloads2012 Efile1040x Tax Return For Prior Year InstructionsFree Tax Help2010 1040ez FormMilitary Free Turbo TaxFree Tax ReturnIrs For 1040ezAmending 2011 TaxesAmend 2012 Tax Return OnlineEz Form1040x Amendment Form2006 Free Tax FilingAmendmentFederal Tax Return 20122012 Free State Tax Filing1040ez Tax Table 2010Filing Amended Tax Return OnlineIrs Tax Form 1040ez1040 Ez Filing2011 1040 EzCan I File 2012 Taxes NowWhat Forms Do I Need To File An Amended Tax Return2010 TaxFile My Federal And State Taxes For Free

Freetaxusa2012

Freetaxusa2012 7. Freetaxusa2012   Depreciation, Depletion, and Amortization Table of Contents What's New for 2013 Introduction Topics - This chapter discusses: Useful Items - You may want to see: Overview of DepreciationWhat Property Can Be Depreciated? What Property Cannot Be Depreciated? When Does Depreciation Begin and End? Can You Use MACRS To Depreciate Your Property? What Is the Basis of Your Depreciable Property? How Do You Treat Repairs and Improvements? Do You Have To File Form 4562? How Do You Correct Depreciation Deductions? Section 179 Expense DeductionWhat Property Qualifies? What Property Does Not Qualify? How Much Can You Deduct? How Do You Elect the Deduction? When Must You Recapture the Deduction? Claiming the Special Depreciation AllowanceWhat is Qualified Property? How Can You Elect Not To Claim the Allowance? When Must You Recapture an Allowance Figuring Depreciation Under MACRSWhich Depreciation System (GDS or ADS) Applies? Which Property Class Applies Under GDS? What Is the Placed-in-Service Date? What Is the Basis for Depreciation? Which Recovery Period Applies? Which Convention Applies? Which Depreciation Method Applies? How Is the Depreciation Deduction Figured? How Do You Use General Asset Accounts? When Do You Recapture MACRS Depreciation? Additional Rules for Listed PropertyWhat Is Listed Property? What Is the Business-Use Requirement? Do the Passenger Automobile Limits Apply? Depletion Who Can Claim Depletion? Figuring Depletion AmortizationBusiness Start-Up Costs Reforestation Costs Section 197 Intangibles What's New for 2013 Increased section 179 expense deduction dollar limits. Freetaxusa2012  The maximum amount you can elect to deduct for most section 179 property you placed in service in 2013 is $500,000. Freetaxusa2012 This limit is reduced by the amount by which the cost of the property placed in service during the tax year exceeds $2 million. Freetaxusa2012 See Dollar Limits under Section 179 Expense Deduction , later. Freetaxusa2012 Extension of special depreciation allowance for certain qualified property acquired after December 31, 2007. Freetaxusa2012 . Freetaxusa2012  You may be able to take a 50% special depreciation allowance for certain qualified property acquired after December 31, 2007, and placed in service before January 1, 2014. Freetaxusa2012 See Claiming the Special Depreciation Allowance , later. Freetaxusa2012 Expiration of the 3- year recovery period for certain race horses. Freetaxusa2012  The 3-year recovery period for race horses two years old or younger will expire for such horses placed in service after December 31, 2013. Freetaxusa2012 Introduction If you buy or make improvements to farm property such as machinery, equipment, livestock, or a structure with a useful life of more than a year, you generally cannot deduct its entire cost in one year. Freetaxusa2012 Instead, you must spread the cost over the time you use the property and deduct part of it each year. Freetaxusa2012 For most types of property, this is called depreciation. Freetaxusa2012 This chapter gives information on depreciation methods that generally apply to property placed in service after 1986. Freetaxusa2012 For information on depreciating pre-1987 property, see Publication 534, Depreciating Property Placed in Service Before 1987. Freetaxusa2012 Topics - This chapter discusses: Overview of depreciation Section 179 expense deduction Special depreciation allowance Modified Accelerated Cost Recovery System (MACRS) Listed property Basic information on cost depletion (including timber depletion) and percentage depletion Amortization of the costs of going into business, reforestation costs, the costs of pollution control facilities, and the costs of section 197 intangibles Useful Items - You may want to see: Publication 463 Travel, Entertainment, Gift, and Car Expenses 534 Depreciating Property Placed in Service Before 1987 535 Business Expenses 544 Sales and Other Dispositions of Assets 551 Basis of Assets 946 How To Depreciate Property Form (and Instructions) T (Timber), Forest Activities Schedule 3115 Application for Change in Accounting Method 4562 Depreciation and Amortization 4797 Sales of Business Property See chapter 16 for information about getting publications and forms. Freetaxusa2012 It is important to keep good records for property you depreciate. Freetaxusa2012 Do not file these records with your return. Freetaxusa2012 Instead, you should keep them as part of the permanent records of the depreciated property. Freetaxusa2012 They will help you verify the accuracy of the depreciation of assets placed in service in the current and previous tax years. Freetaxusa2012 For general information on recordkeeping, see Publication 583, Starting a Business and Keeping Records. Freetaxusa2012 For specific information on keeping records for section 179 property and listed property, see Publication 946, How To Depreciate Property. Freetaxusa2012 Overview of Depreciation This overview discusses basic information on the following. Freetaxusa2012 What property can be depreciated. Freetaxusa2012 What property cannot be depreciated. Freetaxusa2012 When depreciation begins and ends. Freetaxusa2012 Whether MACRS can be used to figure depreciation. Freetaxusa2012 What is the basis of your depreciable property. Freetaxusa2012 How to treat repairs and improvements. Freetaxusa2012 When you must file Form 4562. Freetaxusa2012 How you can correct depreciation claimed incorrectly. Freetaxusa2012 What Property Can Be Depreciated? You can depreciate most types of tangible property (except land), such as buildings, machinery, equipment, vehicles, certain livestock, and furniture. Freetaxusa2012 You can also depreciate certain intangible property, such as copyrights, patents, and computer software. Freetaxusa2012 To be depreciable, the property must meet all the following requirements. Freetaxusa2012 It must be property you own. Freetaxusa2012 It must be used in your business or income-producing activity. Freetaxusa2012 It must have a determinable useful life. Freetaxusa2012 It must have a useful life that extends substantially beyond the year you place it in service. Freetaxusa2012 Property You Own To claim depreciation, you usually must be the owner of the property. Freetaxusa2012 You are considered as owning property even if it is subject to a debt. Freetaxusa2012 Leased property. Freetaxusa2012   You can depreciate leased property only if you retain the incidents of ownership in the property. Freetaxusa2012 This means you bear the burden of exhaustion of the capital investment in the property. Freetaxusa2012 Therefore, if you lease property from someone to use in your trade or business or for the production of income, you generally cannot depreciate its cost because you do not retain the incidents of ownership. Freetaxusa2012 You can, however, depreciate any capital improvements you make to the leased property. Freetaxusa2012 See Additions and Improvements under Which Recovery Period Applies in chapter 4 of Publication 946. Freetaxusa2012   If you lease property to someone, you generally can depreciate its cost even if the lessee (the person leasing from you) has agreed to preserve, replace, renew, and maintain the property. Freetaxusa2012 However, you cannot depreciate the cost of the property if the lease provides that the lessee is to maintain the property and return to you the same property or its equivalent in value at the expiration of the lease in as good condition and value as when leased. Freetaxusa2012 Life tenant. Freetaxusa2012   Generally, if you hold business or investment property as a life tenant, you can depreciate it as if you were the absolute owner of the property. Freetaxusa2012 See Certain term interests in property , later, for an exception. Freetaxusa2012 Property Used in Your Business or Income-Producing Activity To claim depreciation on property, you must use it in your business or income-producing activity. Freetaxusa2012 If you use property to produce income (investment use), the income must be taxable. Freetaxusa2012 You cannot depreciate property that you use solely for personal activities. Freetaxusa2012 However, if you use property for business or investment purposes and for personal purposes, you can deduct depreciation based only on the percentage of business or investment use. Freetaxusa2012 Example 1. Freetaxusa2012   If you use your car for farm business, you can deduct depreciation based on its percentage of use in farming. Freetaxusa2012 If you also use it for investment purposes, you can depreciate it based on its percentage of investment use. Freetaxusa2012 Example 2. Freetaxusa2012   If you use part of your home for business, you may be able to deduct depreciation on that part based on its business use. Freetaxusa2012 For more information, see Business Use of Your Home in chapter 4. Freetaxusa2012 Inventory. Freetaxusa2012   You can never depreciate inventory because it is not held for use in your business. Freetaxusa2012 Inventory is any property you hold primarily for sale to customers in the ordinary course of your business. Freetaxusa2012 Livestock. Freetaxusa2012   Livestock purchased for draft, breeding, or dairy purposes can be depreciated only if they are not kept in an inventory account. Freetaxusa2012 Livestock you raise usually has no depreciable basis because the costs of raising them are deducted and not added to their basis. Freetaxusa2012 However, see Immature livestock under When Does Depreciation Begin and End , later, for a special rule. Freetaxusa2012 Property Having a Determinable Useful Life To be depreciable, your property must have a determinable useful life. Freetaxusa2012 This means it must be something that wears out, decays, gets used up, becomes obsolete, or loses its value from natural causes. Freetaxusa2012 Irrigation systems and water wells. Freetaxusa2012   Irrigation systems and wells used in a trade or business can be depreciated if their useful life can be determined. Freetaxusa2012 You can depreciate irrigation systems and wells composed of masonry, concrete, tile, metal, or wood. Freetaxusa2012 In addition, you can depreciate costs for moving dirt to construct irrigation systems and water wells composed of these materials. Freetaxusa2012 However, land preparation costs for center pivot irrigation systems are not depreciable. Freetaxusa2012 Dams, ponds, and terraces. Freetaxusa2012   In general, you cannot depreciate earthen dams, ponds, and terraces unless the structures have a determinable useful life. Freetaxusa2012 What Property Cannot Be Depreciated? Certain property cannot be depreciated, even if the requirements explained earlier are met. Freetaxusa2012 This includes the following. Freetaxusa2012 Land. Freetaxusa2012 You can never depreciate the cost of land because land does not wear out, become obsolete, or get used up. Freetaxusa2012 The cost of land generally includes the cost of clearing, grading, planting, and landscaping. Freetaxusa2012 Although you cannot depreciate land, you can depreciate certain costs incurred in preparing land for business use. Freetaxusa2012 See chapter 1 of Publication 946. Freetaxusa2012 Property placed in service and disposed of in the same year. Freetaxusa2012 Determining when property is placed in service is explained later. Freetaxusa2012 Equipment used to build capital improvements. Freetaxusa2012 You must add otherwise allowable depreciation on the equipment during the period of construction to the basis of your improvements. Freetaxusa2012 Intangible property such as section 197 intangibles. Freetaxusa2012 This property does not have a determinable useful life and generally cannot be depreciated. Freetaxusa2012 However, see Amortization , later. Freetaxusa2012 Special rules apply to computer software (discussed below). Freetaxusa2012 Certain term interests (discussed below). Freetaxusa2012 Computer software. Freetaxusa2012   Computer software is generally not a section 197 intangible even if acquired in connection with the acquisition of a business, if it meets all of the following tests. Freetaxusa2012 It is readily available for purchase by the general public. Freetaxusa2012 It is subject to a nonexclusive license. Freetaxusa2012 It has not been substantially modified. Freetaxusa2012   If the software meets the tests above, it can be depreciated and may qualify for the section 179 expense deduction and the special depreciation allowance (if applicable), discussed later. Freetaxusa2012 Certain term interests in property. Freetaxusa2012   You cannot depreciate a term interest in property created or acquired after July 27, 1989, for any period during which the remainder interest is held, directly or indirectly, by a person related to you. Freetaxusa2012 This rule does not apply to the holder of a term interest in property acquired by gift, bequest, or inheritance. Freetaxusa2012 For more information, see chapter 1 of Publication 946. Freetaxusa2012 When Does Depreciation Begin and End? You begin to depreciate your property when you place it in service for use in your trade or business or for the production of income. Freetaxusa2012 You stop depreciating property either when you have fully recovered your cost or other basis or when you retire it from service, whichever happens first. Freetaxusa2012 Placed in Service Property is placed in service when it is ready and available for a specific use, whether in a business activity, an income-producing activity, a tax-exempt activity, or a personal activity. Freetaxusa2012 Even if you are not using the property, it is in service when it is ready and available for its specific use. Freetaxusa2012 Example. Freetaxusa2012 You bought a planter for use in your farm business. Freetaxusa2012 The planter was delivered in December 2012 after harvest was over. Freetaxusa2012 You begin to depreciate the planter for 2012 because it was ready and available for its specific use in 2012, even though it will not be used until the spring of 2013. Freetaxusa2012 If your planter comes unassembled in December 2012 and is put together in February 2013, it is not placed in service until 2013. Freetaxusa2012 You begin to depreciate it in 2013. Freetaxusa2012 If your planter was delivered and assembled in February 2013 but not used until April 2013, it is placed in service in February 2013, because this is when the planter was ready for its specified use. Freetaxusa2012 You begin to depreciate it in 2013. Freetaxusa2012 Fruit or nut trees and vines. Freetaxusa2012   If you acquire an orchard, grove, or vineyard before the trees or vines have reached the income-producing stage, and they have a preproductive period of more than 2 years, you must capitalize the preproductive-period costs under the uniform capitalization rules (unless you elect not to use these rules). Freetaxusa2012 See chapter 6 for information about the uniform capitalization rules. Freetaxusa2012 Your depreciation begins when the trees and vines reach the income-producing stage (that is, when they bear fruit, nuts, or grapes in quantities sufficient to commercially warrant harvesting). Freetaxusa2012 Immature livestock. Freetaxusa2012   Depreciation for livestock begins when the livestock reaches the age of maturity. Freetaxusa2012 If you bought immature livestock for drafting purposes, depreciation begins when they can be worked. Freetaxusa2012 If you bought immature livestock for dairy purposes, depreciation begins when they can be milked. Freetaxusa2012 If you bought immature livestock for breeding purposes, depreciation begins when they can be bred. Freetaxusa2012 Your basis for depreciation is your initial cost for the immature livestock. Freetaxusa2012 Idle Property Continue to claim a deduction for depreciation on property used in your business or for the production of income even if it is temporarily idle. Freetaxusa2012 For example, if you stop using a machine because there is a temporary lack of a market for a product made with that machine, continue to deduct depreciation on the machine. Freetaxusa2012 Cost or Other Basis Fully Recovered You stop depreciating property when you have fully recovered your cost or other basis. Freetaxusa2012 This happens when your section 179 and allowed or allowable depreciation deductions equal your cost or investment in the property. Freetaxusa2012 Retired From Service You stop depreciating property when you retire it from service, even if you have not fully recovered its cost or other basis. Freetaxusa2012 You retire property from service when you permanently withdraw it from use in a trade or business or from use in the production of income because of any of the following events. Freetaxusa2012 You sell or exchange the property. Freetaxusa2012 You convert the property to personal use. Freetaxusa2012 You abandon the property. Freetaxusa2012 You transfer the property to a supplies or scrap account. Freetaxusa2012 The property is destroyed. Freetaxusa2012 For information on abandonment of property, see chapter 8. Freetaxusa2012 For information on destroyed property, see chapter 11 and Publication 547, Casualties, Disasters, and Thefts. Freetaxusa2012 Can You Use MACRS To Depreciate Your Property? You must use the Modified Accelerated Cost Recovery System (MACRS) to depreciate most business and investment property placed in service after 1986. Freetaxusa2012 MACRS is explained later under Figuring Depreciation Under MACRS . Freetaxusa2012 You cannot use MACRS to depreciate the following property. Freetaxusa2012 Property you placed in service before 1987. Freetaxusa2012 Use the methods discussed in Publication 534. Freetaxusa2012 Certain property owned or used in 1986. Freetaxusa2012 See chapter 1 of Publication 946. Freetaxusa2012 Intangible property. Freetaxusa2012 Films, video tapes, and recordings. Freetaxusa2012 Certain corporate or partnership property acquired in a nontaxable transfer. Freetaxusa2012 Property you elected to exclude from MACRS. Freetaxusa2012 For more information, see chapter 1 of Publication 946. Freetaxusa2012 What Is the Basis of Your Depreciable Property? To figure your depreciation deduction, you must determine the basis of your property. Freetaxusa2012 To determine basis, you need to know the cost or other basis of your property. Freetaxusa2012 Cost or other basis. Freetaxusa2012   The basis of property you buy is usually its cost plus amounts you paid for items such as sales tax, freight charges, and installation and testing fees. Freetaxusa2012 The cost includes the amount you pay in cash, debt obligations, other property, or services. Freetaxusa2012   There are times when you cannot use cost as basis. Freetaxusa2012 In these situations, the fair market value (FMV) or the adjusted basis of the property may be used. Freetaxusa2012 Adjusted basis. Freetaxusa2012   To find your property's basis for depreciation, you may have to make certain adjustments (increases and decreases) to the basis of the property for events occurring between the time you acquired the property and the time you placed it in service. Freetaxusa2012 Basis adjustment for depreciation allowed or allowable. Freetaxusa2012   After you place your property in service, you must reduce the basis of the property by the depreciation allowed or allowable, whichever is greater. Freetaxusa2012 Depreciation allowed is depreciation you actually deducted (from which you received a tax benefit). Freetaxusa2012 Depreciation allowable is depreciation you are entitled to deduct. Freetaxusa2012   If you do not claim depreciation you are entitled to deduct, you must still reduce the basis of the property by the full amount of depreciation allowable. Freetaxusa2012   If you deduct more depreciation than you should, you must reduce your basis by any amount deducted from which you received a tax benefit (the depreciation allowed). Freetaxusa2012   For more information, see chapter 6. Freetaxusa2012 How Do You Treat Repairs and Improvements? You generally deduct the cost of repairing business property in the same way as any other business expense. Freetaxusa2012 However, if a repair or replacement increases the value of your property, makes it more useful, or lengthens its life, you must treat it as an improvement and depreciate it. Freetaxusa2012 Treat improvements as separate depreciable property. Freetaxusa2012 See chapter 1 of Publication 946 for more information. Freetaxusa2012 Example. Freetaxusa2012 You repair a small section on a corner of the roof of a barn that you rent to others. Freetaxusa2012 You deduct the cost of the repair as a business expense. Freetaxusa2012 However, if you replace the entire roof, the new roof is considered to be an improvement because it increases the value and lengthens the life for the property. Freetaxusa2012 You depreciate the cost of the new roof. Freetaxusa2012 Improvements to rented property. Freetaxusa2012   You can depreciate permanent improvements you make to business property you rent from someone else. Freetaxusa2012 Do You Have To File Form 4562? Use Form 4562 to claim your deduction for depreciation and amortization. Freetaxusa2012 You must complete and attach Form 4562 to your tax return if you are claiming any of the following. Freetaxusa2012 A section 179 expense deduction for the current year or a section 179 carryover from a prior year. Freetaxusa2012 Depreciation for property placed in service during the current year. Freetaxusa2012 Depreciation on any vehicle or other listed property, regardless of when it was placed in service. Freetaxusa2012 Amortization of costs that began in the current year. Freetaxusa2012 For more information, see the Instructions for Form 4562. Freetaxusa2012 How Do You Correct Depreciation Deductions? If you deducted an incorrect amount of depreciation in any year, you may be able to make a correction by filing an amended return for that year. Freetaxusa2012 You can file an amended return to correct the amount of depreciation claimed for any property in any of the following situations. Freetaxusa2012 You claimed the incorrect amount because of a mathematical error made in any year. Freetaxusa2012 You claimed the incorrect amount because of a posting error made in any year, for example, omitting an asset from the depreciation schedule. Freetaxusa2012 You have not adopted a method of accounting for the property placed in service by you in tax years ending after December 29, 2003. Freetaxusa2012 You claimed the incorrect amount on property placed in service by you in tax years ending before December 30, 2003. Freetaxusa2012 Note. Freetaxusa2012 You have adopted a method of accounting if you used the same incorrect method of depreciation for two or more consecutively filed returns. Freetaxusa2012 If you are not allowed to make the correction on an amended return, you may be able to change your accounting method to claim the correct amount of depreciation. Freetaxusa2012 See the Instructions for Form 3115. Freetaxusa2012 Section 179 Expense Deduction You can elect to recover all or part of the cost of certain qualifying property, up to a limit, by deducting it in the year you place the property in service. Freetaxusa2012 This is the section 179 expense deduction. Freetaxusa2012 You can elect the section 179 expense deduction instead of recovering the cost by taking depreciation deductions. Freetaxusa2012 This part of the chapter explains the rules for the section 179 expense deduction. Freetaxusa2012 It explains what property qualifies for the deduction, what property does not qualify for the deduction, the limits that may apply, how to elect the deduction, and when you may have to recapture the deduction. Freetaxusa2012 For more information, see chapter 2 of Publication 946. Freetaxusa2012 What Property Qualifies? To qualify for the section 179 expense deduction, your property must meet all the following requirements. Freetaxusa2012 It must be eligible property. Freetaxusa2012 It must be acquired for business use. Freetaxusa2012 It must have been acquired by purchase. Freetaxusa2012 Eligible Property To qualify for the section 179 expense deduction, your property must be one of the following types of depreciable property. Freetaxusa2012 Tangible personal property. Freetaxusa2012 Qualified real property. Freetaxusa2012 (Special rules apply to qualified real property that you elect to treat as qualified section 179 real property. Freetaxusa2012 For more information, see chapter 2 of Publication 946 and section 179(f) of the Internal Revenue Code. Freetaxusa2012 ) Other tangible property (except buildings and their structural components) used as: An integral part of manufacturing, production, or extraction or of furnishing transportation, communications, electricity, gas, water, or sewage disposal services; A research facility used in connection with any of the activities in (a) above; or A facility used in connection with any of the activities in (a) for the bulk storage of fungible commodities. Freetaxusa2012 Single purpose agricultural (livestock) or horticultural structures. Freetaxusa2012 Storage facilities (except buildings and their structural components) used in connection with distributing petroleum or any primary product of petroleum. Freetaxusa2012 Off-the-shelf computer software that is readily available for purchase by the general public, is subject to a nonexclusive lease, and has not been substantially modified. Freetaxusa2012 Tangible personal property. Freetaxusa2012   Tangible personal property is any tangible property that is not real property. Freetaxusa2012 It includes the following property. Freetaxusa2012 Machinery and equipment. Freetaxusa2012 Property contained in or attached to a building (other than structural components), such as milk tanks, automatic feeders, barn cleaners, and office equipment. Freetaxusa2012 Gasoline storage tanks and pumps at retail service stations. Freetaxusa2012 Livestock, including horses, cattle, hogs, sheep, goats, and mink and other fur-bearing animals. Freetaxusa2012 Facility used for the bulk storage of fungible commodities. Freetaxusa2012   A facility used for the bulk storage of fungible commodities is qualifying property for purposes of the section 179 expense deduction if it is used in connection with any of the activities listed earlier in item (3)(a). Freetaxusa2012 Bulk storage means the storage of a commodity in a large mass before it is used. Freetaxusa2012 Grain bins. Freetaxusa2012   A grain bin is an example of a storage facility that is qualifying section 179 property. Freetaxusa2012 It is a facility used in connection with the production of grain or livestock for the bulk storage of fungible commodities. Freetaxusa2012 Single purpose agricultural or horticultural structures. Freetaxusa2012   A single purpose agricultural (livestock) or horticultural structure is qualifying property for purposes of the section 179 expense deduction. Freetaxusa2012 Agricultural structure. Freetaxusa2012   A single purpose agricultural (livestock) structure is any building or enclosure specifically designed, constructed, and used for both the following reasons. Freetaxusa2012 To house, raise, and feed a particular type of livestock and its produce. Freetaxusa2012 To house the equipment, including any replacements, needed to house, raise, or feed the livestock. Freetaxusa2012 For this purpose, livestock includes poultry. Freetaxusa2012   Single purpose structures are qualifying property if used, for example, to breed chickens or hogs, produce milk from dairy cattle, or produce feeder cattle or pigs, broiler chickens, or eggs. Freetaxusa2012 The facility must include, as an integral part of the structure or enclosure, equipment necessary to house, raise, and feed the livestock. Freetaxusa2012 Horticultural structure. Freetaxusa2012   A single purpose horticultural structure is either of the following. Freetaxusa2012 A greenhouse specifically designed, constructed, and used for the commercial production of plants. Freetaxusa2012 A structure specifically designed, constructed, and used for the commercial production of mushrooms. Freetaxusa2012 Use of structure. Freetaxusa2012   A structure must be used only for the purpose that qualified it. Freetaxusa2012 For example, a hog barn will not be qualifying property if you use it to house poultry. Freetaxusa2012 Similarly, using part of your greenhouse to sell plants will make the greenhouse nonqualifying property. Freetaxusa2012   If a structure includes work space, the work space can be used only for the following activities. Freetaxusa2012 Stocking, caring for, or collecting livestock or plants or their produce. Freetaxusa2012 Maintaining the enclosure or structure. Freetaxusa2012 Maintaining or replacing the equipment or stock enclosed or housed in the structure. Freetaxusa2012 Property Acquired by Purchase To qualify for the section 179 expense deduction, your property must have been acquired by purchase. Freetaxusa2012 For example, property acquired by gift or inheritance does not qualify. Freetaxusa2012 Property acquired from a related person (that is, your spouse, ancestors, or lineal descendants) is not considered acquired by purchase. Freetaxusa2012 Example. Freetaxusa2012 Ken is a farmer. Freetaxusa2012 He purchased two tractors, one from his brother and one from his father. Freetaxusa2012 He placed both tractors in service in the same year he bought them. Freetaxusa2012 The tractor purchased from his father does not qualify for the section 179 expense deduction because he is a related person (as defined above). Freetaxusa2012 The tractor purchased from his brother does qualify for the deduction because Ken is not a related person (as defined above). Freetaxusa2012 What Property Does Not Qualify? Land and improvements. Freetaxusa2012   Land and land improvements, do not qualify as section 179 property. Freetaxusa2012 Land improvements include nonagricultural fences, swimming pools, paved parking areas, wharves, docks, bridges, and fences. Freetaxusa2012 However, agricultural fences do qualify as section 179 property. Freetaxusa2012 Similarly, field drainage tile also qualifies as section 179 property. Freetaxusa2012 Excepted property. Freetaxusa2012   Even if the requirements explained in the preceding discussions are met, farmers cannot elect the section 179 expense deduction for the following property. Freetaxusa2012 Certain property you lease to others (if you are a noncorporate lessor). Freetaxusa2012 Certain property used predominantly to furnish lodging or in connection with the furnishing of lodging. Freetaxusa2012 Property used by a tax-exempt organization (other than a tax-exempt farmers' cooperative) unless the property is used mainly in a taxable unrelated trade or business. Freetaxusa2012 Property used by governmental units or foreign persons or entities (except property used under a lease with a term of less than 6 months). Freetaxusa2012 How Much Can You Deduct? Your section 179 expense deduction is generally the cost of the qualifying property. Freetaxusa2012 However, the total amount you can elect to deduct under section 179 is subject to a dollar limit and a business income limit. Freetaxusa2012 These limits apply to each taxpayer, not to each business. Freetaxusa2012 However, see Married individuals under Dollar Limits , later. Freetaxusa2012 See also the special rules for applying the limits for partnerships and S corporations under Partnerships and S Corporations , later. Freetaxusa2012 If you deduct only part of the cost of qualifying property as a section 179 expense deduction, you can generally depreciate the cost you do not deduct. Freetaxusa2012 Use Part I of Form 4562 to figure your section 179 expense deduction. Freetaxusa2012 Partial business use. Freetaxusa2012   When you use property for business and nonbusiness purposes, you can elect the section 179 expense deduction only if you use it more than 50% for business in the year you place it in service. Freetaxusa2012 If you used the property more than 50% for business, multiply the cost of the property by the percentage of business use. Freetaxusa2012 Use the resulting business cost to figure your section 179 expense deduction. Freetaxusa2012 Trade-in of other property. Freetaxusa2012   If you buy qualifying property with cash and a trade-in, its cost for purposes of the section 179 expense deduction includes only the cash you paid. Freetaxusa2012 For example, if you buy (for cash and a trade-in) a new tractor for use in your business, your cost for the section 179 expense deduction is the cash you paid. Freetaxusa2012 It does not include the adjusted basis of the old tractor you trade for the new tractor. Freetaxusa2012 Example. Freetaxusa2012 J-Bar Farms traded two cultivators having a total adjusted basis of $6,800 for a new cultivator costing $13,200. Freetaxusa2012 They received an $8,000 trade-in allowance for the old cultivators and paid $5,200 cash for the new cultivator. Freetaxusa2012 J-Bar also traded a used pickup truck with an adjusted basis of $8,000 for a new pickup truck costing $35,000. Freetaxusa2012 They received a $5,000 trade-in allowance and paid $30,000 cash for the new pickup truck. Freetaxusa2012 Only the cash paid by J-Bar qualifies for the section 179 expense deduction. Freetaxusa2012 J-Bar's business costs that qualify for a section 179 expense deduction are $35,200 ($5,200 + $30,000). Freetaxusa2012 Dollar Limits The total amount you can elect to deduct under section 179 for most property placed in service in 2013 is $500,000. Freetaxusa2012 If you acquire and place in service more than one item of qualifying property during the year, you can allocate the section 179 expense deduction among the items in any way, as long as the total deduction is not more than $500,000. Freetaxusa2012 Qualified real property that you elect to treat as section 179 property is limited to $250,000 of the maximum section 179 deduction of $500,000 for 2013. Freetaxusa2012 You do not have to claim the full $500,000. Freetaxusa2012 For specific information on the section 179 dollar limits, see chapter 2 of Publication 946. Freetaxusa2012 Reduced dollar limit for cost exceeding $2 million. Freetaxusa2012   If the cost of your qualifying section 179 property placed in service in 2013 is over $2 million, you must reduce the dollar limit (but not below zero) by the amount of cost over $2 million. Freetaxusa2012 If the cost of your section 179 property placed in service during 2013 is $2,500,000 or more, you cannot take a section 179 expense deduction and you cannot carry over the cost that is more than $2,500,000. Freetaxusa2012 Example. Freetaxusa2012 This year, James Smith placed in service machinery costing $2,050,000. Freetaxusa2012 Because this cost is $50,000 more than $2 million, he must reduce his dollar limit to $450,000 ($500,000 − $50,000). Freetaxusa2012 Limits for sport utility vehicles. Freetaxusa2012   The total amount you can elect to deduct for certain sport utility vehicles and certain other vehicles placed in service in 2013 is $25,000. Freetaxusa2012 This rule applies to any 4-wheeled vehicle primarily designed or used to carry passengers over public streets, roads, and highways that is rated at more than 6,000 pounds gross vehicle weight and not more than 14,000 pounds gross vehicle weight. Freetaxusa2012   For more information, see chapter 2 of Publication 946. Freetaxusa2012 Limits for passenger automobiles. Freetaxusa2012   For a passenger automobile that is placed in service in 2013, the total section 179 and depreciation deduction is limited. Freetaxusa2012 See Do the Passenger Automobile Limits Apply , later. Freetaxusa2012 Married individuals. Freetaxusa2012   If you are married, how you figure your section 179 expense deduction depends on whether you file jointly or separately. Freetaxusa2012 If you file a joint return, you and your spouse are treated as one taxpayer in determining any reduction to the dollar limit, regardless of which of you purchased the property or placed it in service. Freetaxusa2012 If you and your spouse file separate returns, you are treated as one taxpayer for the dollar limit, including the reduction for costs over $2 million. Freetaxusa2012 You must allocate the dollar limit (after any reduction) equally between you, unless you both elect a different allocation. Freetaxusa2012 If the percentages elected by each of you do not total 100%, 50% will be allocated to each of you. Freetaxusa2012 Joint return after separate returns. Freetaxusa2012   If you and your spouse elect to amend your separate returns by filing a joint return after the due date for filing your return, the dollar limit on the joint return is the lesser of the following amounts. Freetaxusa2012 The dollar limit (after reduction for any cost of section 179 property over $2 million). Freetaxusa2012 The total cost of section 179 property you and your spouse elected to expense on your separate returns. Freetaxusa2012 Business Income Limit The total cost you can deduct each year after you apply the dollar limit is limited to the taxable income from the active conduct of any trade or business during the year. Freetaxusa2012 Generally, you are considered to actively conduct a trade or business if you meaningfully participate in the management or operations of the trade or business. Freetaxusa2012 Any cost not deductible in one year under section 179 because of this limit can be carried to the next year. Freetaxusa2012 See Carryover of disallowed deduction , later. Freetaxusa2012 Taxable income. Freetaxusa2012   In general, figure taxable income for this purpose by totaling the net income and losses from all trades and businesses you actively conducted during the year. Freetaxusa2012 In addition to net income or loss from a sole proprietorship, partnership, or S corporation, net income or loss derived from a trade or business also includes the following items. Freetaxusa2012 Section 1231 gains (or losses) as discussed in chapter 9. Freetaxusa2012 Interest from working capital of your trade or business. Freetaxusa2012 Wages, salaries, tips, or other pay earned by you (or your spouse if you file a joint return) as an employee of any employer. Freetaxusa2012   In addition, figure taxable income without regard to any of the following. Freetaxusa2012 The section 179 expense deduction. Freetaxusa2012 The self-employment tax deduction. Freetaxusa2012 Any net operating loss carryback or carryforward. Freetaxusa2012 Any unreimbursed employee business expenses. Freetaxusa2012 Two different taxable income limits. Freetaxusa2012   In addition to the business income limit for your section 179 expense deduction, you may have a taxable income limit for some other deduction (for example, charitable contributions). Freetaxusa2012 You may have to figure the limit for this other deduction taking into account the section 179 expense deduction. Freetaxusa2012 If so, complete the following steps. Freetaxusa2012 Step Action 1 Figure taxable income without the section 179 expense deduction or the other deduction. Freetaxusa2012 2 Figure a hypothetical section 179 expense deduction using the taxable income figured in Step 1. Freetaxusa2012 3 Subtract the hypothetical section 179 expense deduction figured in Step 2 from the taxable income figured in Step 1. Freetaxusa2012 4 Figure a hypothetical amount for the other deduction using the amount figured in Step 3 as taxable income. Freetaxusa2012 5 Subtract the hypothetical other deduction figured in Step 4 from the taxable income figured in  Step 1. Freetaxusa2012 6 Figure your actual section 179 expense deduction using the taxable income figured in Step 5. Freetaxusa2012 7 Subtract your actual section 179 expense deduction figured in Step 6 from the taxable income figured in Step 1. Freetaxusa2012 8 Figure your actual other deduction using the taxable income figured in Step 7. Freetaxusa2012 Example. Freetaxusa2012 On February 1, 2013, the XYZ farm corporation purchased and placed in service qualifying section 179 property that cost $500,000. Freetaxusa2012 It elects to expense the entire $500,000 cost under section 179. Freetaxusa2012 In June, the corporation gave a charitable contribution of $10,000. Freetaxusa2012 A corporation's limit on charitable contributions is figured after subtracting any section 179 expense deduction. Freetaxusa2012 The business income limit for the section 179 expense deduction is figured after subtracting any allowable charitable contributions. Freetaxusa2012 XYZ's taxable income figured without the section 179 expense deduction or the deduction for charitable contributions is $520,000. Freetaxusa2012 XYZ figures its section 179 expense deduction and its deduction for charitable contributions as follows. Freetaxusa2012 Step 1. Freetaxusa2012 Taxable income figured without either deduction is $520,000. Freetaxusa2012 Step 2. Freetaxusa2012 Using $520,000 as taxable income, XYZ's hypothetical section 179 expense deduction is $500,000. Freetaxusa2012 Step 3. Freetaxusa2012 $20,000 ($520,000 − $500,000). Freetaxusa2012 Step 4. Freetaxusa2012 Using $20,000 (from Step 3) as taxable income, XYZ's hypothetical charitable contribution (limited to 10% of taxable income) is $2,000. Freetaxusa2012 Step 5. Freetaxusa2012 $518,000 ($520,000 − $2,000). Freetaxusa2012 Step 6. Freetaxusa2012 Using $518,000 (from Step 5) as taxable income, XYZ figures the actual section 179 expense deduction. Freetaxusa2012 Because the taxable income is at least $500,000, XYZ can take a $500,000 section 179 expense deduction. Freetaxusa2012 Step 7. Freetaxusa2012 $20,000 ($520,000 − $500,000). Freetaxusa2012 Step 8. Freetaxusa2012 Using $20,000 (from Step 7) as taxable income, XYZ's actual charitable contribution (limited to 10% of taxable income) is $2,000. Freetaxusa2012 Carryover of disallowed deduction. Freetaxusa2012   You can carry over for an unlimited number of years the cost of any section 179 property you elected to expense but were unable to because of the business income limit. Freetaxusa2012   The amount you carry over is used in determining your section 179 expense deduction in the next year. Freetaxusa2012 However, it is subject to the limits in that year. Freetaxusa2012 If you place more than one property in service in a year, you can select the properties for which all or a part of the cost will be carried forward. Freetaxusa2012 Your selections must be shown in your books and records. Freetaxusa2012 Example. Freetaxusa2012 Last year, Joyce Jones placed in service a machine that cost $8,000 and elected to deduct all $8,000 under section 179. Freetaxusa2012 The taxable income from her business (determined without regard to both a section 179 expense deduction for the cost of the machine and the self-employment tax deduction) was $6,000. Freetaxusa2012 Her section 179 expense deduction was limited to $6,000. Freetaxusa2012 The $2,000 cost that was not allowed as a section 179 expense deduction (because of the business income limit) is carried to this year. Freetaxusa2012 This year, Joyce placed another machine in service that cost $9,000. Freetaxusa2012 Her taxable income from business (determined without regard to both a section 179 expense deduction for the cost of the machine and the self-employment tax deduction) is $10,000. Freetaxusa2012 Joyce can deduct the full cost of the machine ($9,000) but only $1,000 of the carryover from last year because of the business income limit. Freetaxusa2012 She can carry over the balance of $1,000 to next year. Freetaxusa2012 Partnerships and S Corporations The section 179 expense deduction limits apply both to the partnership or S corporation and to each partner or shareholder. Freetaxusa2012 The partnership or S corporation determines its section 179 expense deduction subject to the limits. Freetaxusa2012 It then allocates the deduction among its partners or shareholders. Freetaxusa2012 If you are a partner in a partnership or shareholder of an S corporation, you add the amount allocated from the partnership or S corporation to any section 179 costs not related to the partnership or S corporation and then apply the dollar limit to this total. Freetaxusa2012 To determine any reduction in the dollar limit for costs over $560,000, you do not include any of the cost of section 179 property placed in service by the partnership or S corporation. Freetaxusa2012 After you apply the dollar limit, you apply the business income limit to any remaining section 179 costs. Freetaxusa2012 For more information, see chapter 2 of Publication 946. Freetaxusa2012 Example. Freetaxusa2012 In 2013, Partnership P placed in service section 179 property with a total cost of $2,160,000. Freetaxusa2012 P must reduce its dollar limit by $160,000 ($2,160,000 − $2,000,000). Freetaxusa2012 Its maximum section 179 expense deduction is $340,000 ($500,000 − $160,000), and it elects to expense that amount. Freetaxusa2012 Because P's taxable income from the active conduct of all its trades or businesses for the year was $400,000, it can deduct the full $340,000. Freetaxusa2012 P allocates $100,000 of its section 179 expense deduction and $110,000 of its taxable income to John, one of its partners. Freetaxusa2012 John also conducts a business as a sole proprietor and in 2013, placed in service in that business, section 179 property costing $28,000. Freetaxusa2012 John's taxable income from that business was $10,000. Freetaxusa2012 In addition to the $100,000 allocated from P, he elects to expense the $28,000 of his sole proprietorship's section 179 costs. Freetaxusa2012 However, John's deduction is limited to his business taxable income of $120,000 ($110,000 from P plus $10,000 from his sole proprietorship). Freetaxusa2012 He carries over $8,000 ($128,000 − $120,000) of the elected section 179 costs to 2014. Freetaxusa2012 How Do You Elect the Deduction? You elect to take the section 179 expense deduction by completing Part I of Form 4562. Freetaxusa2012 If you elect the deduction for listed property, complete Part V of  Form 4562 before completing Part I. Freetaxusa2012   File Form 4562 with either of the following: Your original tax return (whether or not you filed it timely), or An amended return filed within the time prescribed by law. Freetaxusa2012 An election made on an amended return must specify the item of section 179 property to which the election applies and the part of the cost of each such item to be taken into account. Freetaxusa2012 The amended return must also include any resulting adjustments to taxable income. Freetaxusa2012 Revoking an election. Freetaxusa2012   An election (or any specification made in the election) to take a section 179 expense deduction for 2013 can be revoked without IRS approval by filing an amended return. Freetaxusa2012 The amended return must be filed within the time prescribed by law. Freetaxusa2012 The amended return must also include any resulting adjustments to taxable income (for example, allowable depreciation in that tax year for the item of section 179 property for which the election pertains. Freetaxusa2012 ) Once made, the revocation is irrevocable. Freetaxusa2012 When Must You Recapture the Deduction? You may have to recapture the section 179 expense deduction if, in any year during the property's recovery period, the percentage of business use drops to 50% or less. Freetaxusa2012 In the year the business use drops to 50% or less, you include the recapture amount as ordinary income. Freetaxusa2012 You also increase the basis of the property by the recapture amount. Freetaxusa2012 Recovery periods for property are discussed later. Freetaxusa2012 If you sell, exchange, or otherwise dispose of the property, do not figure the recapture amount under the rules explained in this discussion. Freetaxusa2012 Instead, use the rules for recapturing depreciation explained in  chapter 9 under Section 1245 Property. Freetaxusa2012   If the property is listed property, do not figure the recapture amount under the rules explained in this discussion when the percentage of business use drops to 50% or less. Freetaxusa2012 Instead, use the rules for recapturing depreciation explained in chapter 5 of Publication 946 under Recapture of Excess Depreciation. Freetaxusa2012 Figuring the recapture amount. Freetaxusa2012   To figure the amount to recapture, take the following steps. Freetaxusa2012 Figure the allowable depreciation for the section 179 expense deduction you claimed. Freetaxusa2012 Begin with the year you placed the property in service and include the year of recapture. Freetaxusa2012 Subtract the depreciation figured in (1) from the section 179 expense deduction you actually claimed. Freetaxusa2012 The result is the amount you must recapture. Freetaxusa2012 Example. Freetaxusa2012 In January 2011, Paul Lamb, a calendar year taxpayer, bought and placed in service section 179 property costing $10,000. Freetaxusa2012 The property is not listed property. Freetaxusa2012 He elected a $5,000 section 179 expense deduction for the property and also elected not to claim a special depreciation allowance. Freetaxusa2012 He used the property only for business in 2011 and 2012. Freetaxusa2012 During 2013, he used the property 40% for business and 60% for personal use. Freetaxusa2012 He figures his recapture amount as follows. Freetaxusa2012 Section 179 expense deduction claimed (2011) $5,000 Minus: Allowable depreciation (instead of section 179 expense deduction):   2011 $1,250   2012 1,875   2013 ($1,250 × 40% (business)) 500 3,625 2013 — Recapture amount $1,375     Paul must include $1,375 in income for 2013. Freetaxusa2012 Where to report recapture. Freetaxusa2012   Report any recapture of the section 179 expense deduction as ordinary income in Part IV of Form 4797 and include it in income on Schedule F (Form 1040). Freetaxusa2012 Recapture for qualified section 179 GO Zone property. Freetaxusa2012   If any qualified section 179 GO Zone property ceases to be used in the GO Zone in a later year, you must recapture the benefit of the increased section 179 expense deduction as “other income. Freetaxusa2012 ” Claiming the Special Depreciation Allowance For qualified property (defined below) placed in service in 2013, you can take an additional 50% special depreciation allowance. Freetaxusa2012 The allowance is an additional deduction you can take after any section 179 expense deduction and before you figure regular depreciation under MACRS. Freetaxusa2012 Figure the special depreciation allowance by multiplying the depreciable basis of the qualified property by 50%. Freetaxusa2012 What is Qualified Property? For farmers, qualified property generally is certain qualified property acquired after December 31, 2007, and placed in service before January 1, 2014. Freetaxusa2012 Certain qualified property acquired after December 31, 2007, and placed in service before January 1, 2014. Freetaxusa2012   Certain qualified property (defined below) acquired after December 31, 2007, and before January 1, 2014, is eligible for a 50% special depreciation allowance. Freetaxusa2012   Qualified property includes the following: Tangible property depreciated under the Modified Accelerated Cost Recovery System (MACRS) with a recovery period of 20 years or less. Freetaxusa2012 Water utility property. Freetaxusa2012 Off-the-shelf computer software. Freetaxusa2012 Qualified leasehold improvement property. Freetaxusa2012   Qualified property must also meet all of the following tests: You must have acquired qualified property by purchase after December 31, 2007. Freetaxusa2012 If a binding contract to acquire the property existed before January 1, 2008, the property does not qualify. Freetaxusa2012 Qualified property must be placed in service after December 31, 2007 and placed in service before January 1, 2014 (before January 1, 2015 for certain property with a long production period and for certain aircraft). Freetaxusa2012 The original use of the property must begin with you after December 31, 2007. Freetaxusa2012 For more information, see chapter 3 of Publication 946. Freetaxusa2012 How Can You Elect Not To Claim the Allowance? You can elect, for any class of property, not to deduct the special depreciation allowance for all property in such class placed in service during the tax year. Freetaxusa2012 To make the election, attach a statement to your return indicating the class of property for which you are making the election. Freetaxusa2012 Generally, you must make the election on a timely filed tax return (including extensions) for the year in which you place the property in service. Freetaxusa2012 However, if you timely filed your return for the year without making the election, you still can make the election by filing an amended return within 6 months of the due date of the original return (not including extensions). Freetaxusa2012 Attach the election statement to the amended return. Freetaxusa2012 On the amended return, write “Filed pursuant to section 301. Freetaxusa2012 9100-2. Freetaxusa2012 ” Once made, the election may not be revoked without IRS consent. Freetaxusa2012 If you elect not to have the special depreciation allowance apply, the property may be subject to an alternative minimum tax adjustment for depreciation. Freetaxusa2012 When Must You Recapture an Allowance When you dispose of property for which you claimed a special depreciation allowance, any gain on the disposition is generally recaptured (included in income) as ordinary income up to the amount of the special depreciation allowance previously allowed or allowable. Freetaxusa2012 For more information, see chapter 3 of Publication 946. Freetaxusa2012 Figuring Depreciation Under MACRS The Modified Accelerated Cost Recovery System (MACRS) is used to recover the basis of most business and investment property placed in service after 1986. Freetaxusa2012 MACRS consists of two depreciation systems, the General Depreciation System (GDS) and the Alternative Depreciation System (ADS). Freetaxusa2012 Generally, these systems provide different methods and recovery periods to use in figuring depreciation deductions. Freetaxusa2012 To be sure you can use MACRS to figure depreciation for your property, see Can You Use MACRS To Depreciate Your Property, earlier. Freetaxusa2012 This part explains how to determine which MACRS depreciation system applies to your property. Freetaxusa2012 It also discusses the following information that you need to know before you can figure depreciation under MACRS. Freetaxusa2012 Property's recovery class. Freetaxusa2012 Placed-in-service date. Freetaxusa2012 Basis for depreciation. Freetaxusa2012 Recovery period. Freetaxusa2012 Convention. Freetaxusa2012 Depreciation method. Freetaxusa2012 Finally, this part explains how to use this information to figure your depreciation deduction. Freetaxusa2012 Which Depreciation System (GDS or ADS) Applies? Your use of either the General Depreciation System (GDS) or the Alternative Depreciation System (ADS) to depreciate property under MACRS determines what depreciation method and recovery period you use. Freetaxusa2012 You generally must use GDS unless you are specifically required by law to use ADS or you elect to use ADS. Freetaxusa2012 Required use of ADS. Freetaxusa2012   You must use ADS for the following property. Freetaxusa2012 All property used predominantly in a farming business and placed in service in any tax year during which an election not to apply the uniform capitalization rules to certain farming costs is in effect. Freetaxusa2012 Listed property used 50% or less in a qualified business use. Freetaxusa2012 See Additional Rules for Listed Property , later. Freetaxusa2012 Any tax-exempt use property. Freetaxusa2012 Any tax-exempt bond-financed property. Freetaxusa2012 Any property imported from a foreign country for which an Executive Order is in effect because the country maintains trade restrictions or engages in other discriminatory acts. Freetaxusa2012 Any tangible property used predominantly outside the United States during the year. Freetaxusa2012 If you are required to use ADS to depreciate your property, you cannot claim the special depreciation allowance. Freetaxusa2012 Electing ADS. Freetaxusa2012   Although your property may qualify for GDS, you can elect to use ADS. Freetaxusa2012 The election generally must cover all property in the same property class you placed in service during the year. Freetaxusa2012 However, the election for residential rental property and nonresidential real property can be made on a property-by-property basis. Freetaxusa2012 Once you make this election, you can never revoke it. Freetaxusa2012   You make the election by completing line 20 in Part III of Form 4562. Freetaxusa2012 Which Property Class Applies Under GDS? The following is a list of the nine property classes under GDS. Freetaxusa2012 3-year property. Freetaxusa2012 5-year property. Freetaxusa2012 7-year property. Freetaxusa2012 10-year property. Freetaxusa2012 15-year property. Freetaxusa2012 20-year property. Freetaxusa2012 25-year property. Freetaxusa2012 Residential rental property. Freetaxusa2012 Nonresidential real property. Freetaxusa2012 See Which Property Class Applies Under GDS in chapter 4 of Publication 946 for examples of the types of property included in each class. Freetaxusa2012 What Is the Placed-in-Service Date? You begin to claim depreciation when your property is placed in service for use either in a trade or business or for the production of income. Freetaxusa2012 The placed-in-service date for your property is the date the property is ready and available for a specific use. Freetaxusa2012 It is therefore not necessarily the date it is first used. Freetaxusa2012 If you converted property held for personal use to use in a trade or business or for the production of income, treat the property as being placed in service on the conversion date. Freetaxusa2012 See Placed in Service under When Does Depreciation Begin and End , earlier, for examples illustrating when property is placed in service. Freetaxusa2012 What Is the Basis for Depreciation? The basis for depreciation of MACRS property is the property's cost or other basis multiplied by the percentage of business/investment use. Freetaxusa2012 Reduce that amount by any credits and deductions allocable to the property. Freetaxusa2012 The following are examples of some of the credits and deductions that reduce basis. Freetaxusa2012 Any deduction for section 179 property. Freetaxusa2012 Any deduction for removal of barriers to the disabled and the elderly. Freetaxusa2012 Any disabled access credit, enhanced oil recovery credit, and credit for employer-provided childcare facilities and services. Freetaxusa2012 Any special depreciation allowance. Freetaxusa2012 Basis adjustment for investment credit property under section 50(c) of the Internal Revenue Code. Freetaxusa2012 For information about how to determine the cost or other basis of property, see What Is the Basis of Your Depreciable Property , earlier. Freetaxusa2012 Also, see chapter 6. Freetaxusa2012 For additional credits and deductions that affect basis, see section 1016 of the Internal Revenue Code. Freetaxusa2012 Which Recovery Period Applies? The recovery period of property is the number of years over which you recover its cost or other basis. Freetaxusa2012 It is determined based on the depreciation system (GDS or ADS) used. Freetaxusa2012 See Table 7-1 for recovery periods under both GDS and ADS for some commonly used assets. Freetaxusa2012 For a complete list of recovery periods, see the Table of Class Lives and Recovery Periods in Appendix B of Publication 946. Freetaxusa2012 House trailers for farm laborers. Freetaxusa2012   To depreciate a house trailer you supply as housing for those who work on your farm, use one of the following recovery periods if the house trailer is mobile (it has wheels and a history of movement). Freetaxusa2012 A 7-year recovery period under GDS. Freetaxusa2012 A 10-year recovery period under ADS. Freetaxusa2012   However, if the house trailer is not mobile (its wheels have been removed and permanent utilities and pipes attached to it), use one of the following recovery periods. Freetaxusa2012 A 20-year recovery period under GDS. Freetaxusa2012 A 25-year recovery period under ADS. Freetaxusa2012 Water wells. Freetaxusa2012   Water wells used to provide water for raising poultry and livestock are land improvements. Freetaxusa2012 If they are depreciable, use one of the following recovery periods. Freetaxusa2012 A 15-year recovery period under GDS. Freetaxusa2012 A 20-year recovery period under ADS. Freetaxusa2012   The types of water wells that can be depreciated were discussed earlier in Irrigation systems and water wells under Property Having a Determinable Useful Life . Freetaxusa2012 Table 7-1. Freetaxusa2012 Farm Property Recovery Periods   Recovery Period in Years Assets GDS ADS Agricultural structures (single purpose) 10 15 Automobiles 5 5 Calculators and copiers 5 6 Cattle (dairy or breeding) 5 7 Communication equipment1 7 10 Computer and peripheral equipment 5 5 Drainage facilities 15 20 Farm buildings2 20 25 Farm machinery and equipment 7 10 Fences (agricultural) 7 10 Goats and sheep (breeding) 5 5 Grain bin 7 10 Hogs (breeding) 3 3 Horses (age when placed in service)     Breeding and working (12 years or less) 7 10 Breeding and working (more than 12 years) 3 10 Racing horses 3 12 Horticultural structures (single purpose) 10 15 Logging machinery and equipment3 5 6 Nonresidential real property 394 40 Office furniture, fixtures, and equipment (not calculators, copiers, or typewriters) 7 10 Paved lots 15 20 Residential rental property 27. Freetaxusa2012 5 40 Tractor units (over-the-road) 3 4 Trees or vines bearing fruit or nuts 10 20 Truck (heavy duty, unloaded weight 13,000 lbs. Freetaxusa2012 or more) 5 6 Truck (actual weight less than 13,000 lbs) 5 5 Water wells 15 20 1 Not including communication equipment listed in other classes. Freetaxusa2012 2 Not including single purpose agricultural or horticultural structures. Freetaxusa2012 3 Used by logging and sawmill operators for cutting of timber. Freetaxusa2012 4 For property placed in service after May 12, 1993; for property placed in service before May 13, 1993,  the recovery period is 31. Freetaxusa2012 5 years. Freetaxusa2012 Which Convention Applies? Under MACRS, averaging conventions establish when the recovery period begins and ends. Freetaxusa2012 The convention you use determines the number of months for which you can claim depreciation in the year you place property in service and in the year you dispose of the property. Freetaxusa2012 Use one of the following conventions. Freetaxusa2012 The half-year convention. Freetaxusa2012 The mid-month convention. Freetaxusa2012 The mid-quarter convention. Freetaxusa2012 For a detailed explanation of each convention, see Which Convention Applies in chapter 4 of Publication 946. Freetaxusa2012 Also, see the Instructions for Form 4562. Freetaxusa2012 Which Depreciation Method Applies? MACRS provides three depreciation methods under GDS and one depreciation method under ADS. Freetaxusa2012 The 200% declining balance method over a GDS recovery period. Freetaxusa2012 The 150% declining balance method over a GDS recovery period. Freetaxusa2012 The straight line method over a GDS recovery period. Freetaxusa2012 The straight line method over an ADS recovery period. Freetaxusa2012 Depreciation Table. Freetaxusa2012   The following table lists the types of property you can depreciate under each method. Freetaxusa2012 The declining balance method is abbreviated as DB and the straight line method is abbreviated as SL. Freetaxusa2012 Depreciation Table System/Method   Type of Property GDS using  150% DB • All property used in a farming business (except real property)   • All 15- and 20-year property   • Nonfarm 3-, 5-, 7-, and 10-year property1 GDS using SL • Nonresidential real property   • Residential rental property   • Trees or vines bearing fruit or nuts   • All 3-, 5-, 7-, 10-, 15-, and 20-year property1 ADS using SL • Property used predomi- nantly outside the United States   • Farm property used when an election not to apply the uniform capitalization rules is in effect   • Tax-exempt property   • Tax-exempt bond-financed property   • Imported property2   • Any property for which you elect to use this method1 GDS using  200% DB • Nonfarm 3-, 5-, 7-, and 10-year property 1Elective method 2See section 168(g)(6) of the Internal Revenue  Code Property used in farming business. Freetaxusa2012   For personal property placed in service after 1988 in a farming business, you must use the 150% declining balance method over a GDS recovery period or you can elect one of the following methods. Freetaxusa2012 The straight line method over a GDS recovery period. Freetaxusa2012 The straight line method over an ADS recovery period. Freetaxusa2012 For property placed in service before 1999, you could have elected to use the 150% declining balance method using the ADS recovery periods for certain property classes. Freetaxusa2012 If you made this election, continue to use the same method and recovery period for that property. Freetaxusa2012 Real property. Freetaxusa2012   You can depreciate real property using the straight line method under either GDS or ADS. Freetaxusa2012 Switching to straight line. Freetaxusa2012   If you use a declining balance method, you switch to the straight line method in the year it provides an equal or greater deduction. Freetaxusa2012 If you use the MACRS percentage tables, discussed later under How Is the Depreciation Deduction Figured , you do not need to determine in which year your deduction is greater using the straight line method. Freetaxusa2012 The tables have the switch to the straight line method built into their rates. Freetaxusa2012 Fruit or nut trees and vines. Freetaxusa2012   Depreciate trees and vines bearing fruit or nuts under GDS using the straight line method over a 10-year recovery period. Freetaxusa2012 ADS required for some farmers. Freetaxusa2012   If you elect not to apply the uniform capitalization rules to any plant shown in Table 6-1 of chapter 6 and produced in your farming business, you must use ADS for all property you place in service in any year the election is in effect. Freetaxusa2012 See chapter 6 for a discussion of the application of the uniform capitalization rules to farm property. Freetaxusa2012 Electing a different method. Freetaxusa2012   As shown in the Depreciation Table , you can elect a different method for depreciation for certain types of property. Freetaxusa2012 You must make the election by the due date of the return (including extensions) for the year you placed the property in service. Freetaxusa2012 However, if you timely filed your return for the year without making the election, you can still make the election by filing an amended return within 6 months of the due date of your return (excluding extensions). Freetaxusa2012 Attach the election to the amended return and write “Filed pursuant to section 301. Freetaxusa2012 9100-2” on the election statement. Freetaxusa2012 File the amended return at the same address you filed the original return. Freetaxusa2012 Once you make the election, you cannot change it. Freetaxusa2012    If you elect to use a different method for one item in a property class, you must apply the same method to all property in that class placed in service during the year of the election. Freetaxusa2012 However, you can make the election on a property-by-property basis for residential rental and nonresidential real property. Freetaxusa2012 Straight line election. Freetaxusa2012   Instead of using the declining balance method, you can elect to use the straight line method over the GDS recovery period. Freetaxusa2012 Make the election by entering “S/L” under column (f) in Part III of Form 4562. Freetaxusa2012 ADS election. Freetaxusa2012   As explained earlier under Which Depreciation System (GDS or ADS) Applies , you can elect to use ADS even though your property may come under GDS. Freetaxusa2012 ADS uses the straight line method of depreciation over the ADS recovery periods, which are generally longer than the GDS recovery periods. Freetaxusa2012 The ADS recovery periods for many assets used in the business of farming are listed in Table 7–1. Freetaxusa2012 Additional ADS recovery periods for other classes of property may be found in the Table of Class Lives and Recovery Periods in Appendix B of Publication 946. Freetaxusa2012 How Is the Depreciation Deduction Figured? To figure your depreciation deduction under MACRS, you first determine the depreciation system, property class, placed-in-service date, basis amount, recovery period, convention, and depreciation method that applies to your property. Freetaxusa2012 Then you are ready to figure your depreciation deduction. Freetaxusa2012 You can figure it in one of two ways. Freetaxusa2012 You can use the percentage tables provided by the IRS. Freetaxusa2012 You can figure your own deduction without using the tables. Freetaxusa2012 Figuring your own MACRS deduction will generally result in a slightly different amount than using the tables. Freetaxusa2012 Using the MACRS Percentage Tables To help you figure your deduction under MACRS, the IRS has established percentage tables that incorporate the applicable convention and depreciation method. Freetaxusa2012 These percentage tables are in Appendix A of Publication 946. Freetaxusa2012 Rules for using the tables. Freetaxusa2012   The following rules cover the use of the percentage tables. Freetaxusa2012 You must apply the rates in the percentage tables to your property's unadjusted basis. Freetaxusa2012 Unadjusted basis is the same basis amount you would use to figure gain on a sale but figured without reducing your original basis by any MACRS depreciation taken in earlier years. Freetaxusa2012 You cannot use the percentage tables for a short tax year. Freetaxusa2012 See chapter 4 of Publication 946 for information on how to figure the deduction for a short tax year. Freetaxusa2012 You generally must continue to use them for the entire recovery period of the property. Freetaxusa2012 You must stop using the tables if you adjust the basis of the property for any reason other than— Depreciation allowed or allowable, or An addition or improvement to the property, which is depreciated as a separate property. Freetaxusa2012 Basis adjustment due to casualty loss. Freetaxusa2012   If you reduce the basis of your property because of a casualty, you cannot continue to use the percentage tables. Freetaxusa2012 For the year of the adjustment and the remaining recovery period, you must figure the depreciation yourself using the property's adjusted basis at the end of the year. Freetaxusa2012 See Figuring the Deduction Without Using the Tables in chapter 4 of Publication 946. Freetaxusa2012 Figuring depreciation using the 150% DB method and half-year convention. Freetaxusa2012    Table 7-2 has the percentages for 3-, 5-, 7-, and 20-year property. Freetaxusa2012 The percentages are based on the 150% declining balance method with a change to the straight line method. Freetaxusa2012 This table covers only the half-year convention and the first 8 years for 20-year property. Freetaxusa2012 See Appendix A in Publication 946 for complete MACRS tables, including tables for the mid-quarter and mid-month convention. Freetaxusa2012   The following examples show how to figure depreciation under MACRS using the percentages in Table 7-2 . Freetaxusa2012 Example 1. Freetaxusa2012 During the year, you bought an item of 7-year property for $10,000 and placed it in service. Freetaxusa2012 You do not elect a section 179 expense deduction for this property. Freetaxusa2012 In addition, the property is not qualified property for purposes of the special depreciation allowance. Freetaxusa2012 The unadjusted basis of the property is $10,000. Freetaxusa2012 You use the percentages in Table 7-2 to figure your deduction. Freetaxusa2012 Since this is 7-year property, you multiply $10,000 by 10. Freetaxusa2012 71% to get this year's depreciation of $1,071. Freetaxusa2012 For next year, your depreciation will be $1,913 ($10,000 × 19. Freetaxusa2012 13%). Freetaxusa2012 Example 2. Freetaxusa2012 You had a barn constructed on your farm at a cost of $20,000. Freetaxusa2012 You placed the barn in service this year. Freetaxusa2012 You elect not to claim the special depreciation allowance. Freetaxusa2012 The barn is 20-year property and you use the table percentages to figure your deduction. Freetaxusa2012 You figure this year's depreciation by multiplying $20,000 (unadjusted basis) by 3. Freetaxusa2012 75% to get $750. Freetaxusa2012 For next year, your depreciation will be $1,443. Freetaxusa2012 80 ($20,000 × 7. Freetaxusa2012 219%). Freetaxusa2012 Table 7-2. Freetaxusa2012 150% Declining Balance Method (Half-Year Convention) Year 3-Year 5-Year 7-Year 20-Year 1 25. Freetaxusa2012 0 % 15. Freetaxusa2012 00 % 10. Freetaxusa2012 71 % 3. Freetaxusa2012 750 % 2 37. Freetaxusa2012 5   25. Freetaxusa2012 50   19. Freetaxusa2012 13   7. Freetaxusa2012 219   3 25. Freetaxusa2012 0   17. Freetaxusa2012 85   15. Freetaxusa2012 03   6. Freetaxusa2012 677   4 12. Freetaxusa2012 5   16. Freetaxusa2012 66   12. Freetaxusa2012 25   6. Freetaxusa2012 177   5     16. Freetaxusa2012 66   12. Freetaxusa2012 25   5. Freetaxusa2012 713   6     8. Freetaxusa2012 33   12. Freetaxusa2012 25   5. Freetaxusa2012 285   7         12. Freetaxusa2012 25   4. Freetaxusa2012 888   8         6. Freetaxusa2012 13   4. Freetaxusa2012 522   Figuring depreciation using the straight line method and half-year convention. Freetaxusa2012   The following table has the straight line percentages for 3-, 5-, 7-, and 20-year property using the half-year convention. Freetaxusa2012 The table covers only the first 8 years for 20-year property. Freetaxusa2012 See Appendix A in Publication 946 for complete MACRS tables, including tables for the mid-quarter and mid-month convention. Freetaxusa2012 Table 7-3. Freetaxusa2012 Straight Line Method (Half-Year Convention) Year 3-Year 5-Year 7-Year 20-Year 1 16. Freetaxusa2012 67 % 10 % 7. Freetaxusa2012 14 % 2. Freetaxusa2012 5 % 2 33. Freetaxusa2012 33   20   14. Freetaxusa2012 29   5. Freetaxusa2012 0   3 33. Freetaxusa2012 33   20   14. Freetaxusa2012 29   5. Freetaxusa2012 0   4 16. Freetaxusa2012 67   20   14. Freetaxusa2012 28   5. Freetaxusa2012 0   5     20   14. Freetaxusa2012 29   5. Freetaxusa2012 0   6     10   14. Freetaxusa2012 28   5. Freetaxusa2012 0   7         14. Freetaxusa2012 29   5. Freetaxusa2012 0   8         7. Freetaxusa2012 14   5. Freetaxusa2012 0    
Print - Click this link to Print this page

New Two-Year Period to Adopt Restated Pre-approved DC Plans

The IRS expects to issue most opinion and advisory letters for the latest round of pre-approved defined contribution plans on March 31, 2014. Employers using pre-approved defined contribution plan documents must adopt plan documents restated for the 2010 Cumulative List by April 30, 2016 (Announcement 2014-16).

Determination letters for pre-approved defined contribution plans

Starting May 1, 2014, and ending April 30, 2016, employers can submit applications for individual determination letters for pre-approved defined contribution plans.

An employer who adopts a master & prototype plan (standardized or non-standardized) may not apply for its own determination letter on Form 5307, Application for Determination for Adopters of Master or Prototype or Volume Submitter Plans (instructions) – instead, the employer should rely on the letter issued to the plan sponsor.

However, an adopting employer who made limited modifications to its volume submitter plan may apply for a determination letter on Form 5307. If the modifications are extensive, causing the plan to be treated as an individually designed plan, the employer must instead file Form 5300, Application for Determination for Employee Benefit Plan.

See Revenue Procedure 2014-6, sections 8 and 9 for more information on determination letter applications for pre-approved plans.

Additional resources

 

Page Last Reviewed or Updated: 27-Mar-2014

The Freetaxusa2012

Freetaxusa2012 Index Symbols 1231 property sale, Sale of property interest. Freetaxusa2012 401(k) plans, Elective Deferrals Excess contributions, Excess Contributions 403(b) plans, Elective Deferrals Limit for, Limit for tax-sheltered annuities. Freetaxusa2012 457 plans, Elective Deferrals Limit for deferrals under, Limit for deferrals under section 457 plans. Freetaxusa2012 501(c)(18)(D) plans, Elective Deferrals Contributions, Section 501(c)(18)(D) contributions. Freetaxusa2012 501(c)(3) organizations, Student loans. Freetaxusa2012 529 program, Qualified tuition program (QTP). Freetaxusa2012 83(b) election, How to make the choice. Freetaxusa2012 A Academic health centers Meals and lodging when teaching and research organization, Academic health center. Freetaxusa2012 Accelerated death benefits, Accelerated Death Benefits Accident insurance, Accident or Health Plan Accidental death benefits, Accidental death benefits. Freetaxusa2012 Accrual method taxpayers, Prepaid income. Freetaxusa2012 Accrued leave payment At time of retirement or resignation, Accrued leave payment. Freetaxusa2012 Disability retirement, Accrued leave payment. Freetaxusa2012 Activity not for profit, Activity not for profit. Freetaxusa2012 Adoption Employer assistance, Adoption Assistance Advance commissions, Miscellaneous Compensation Aircraft, Flights on employer-provided aircraft. Freetaxusa2012 Airlines No-additional-cost services, No-Additional-Cost Services Valuation of flights on employer-provided aircraft, Flights on employer-provided aircraft. Freetaxusa2012 Alaska Permanent Fund dividend, Alaska Permanent Fund dividend. Freetaxusa2012 Alien status, waiver of, Waiver of alien status. Freetaxusa2012 Aliens Nonresident, Nonresident aliens. Freetaxusa2012 Alimony, Alimony. Freetaxusa2012 Alternative minimum tax (AMT) Recoveries, refiguring of, Subject to alternative minimum tax. Freetaxusa2012 Stock options, Alternative minimum tax (AMT). Freetaxusa2012 Annuities Charitable gift, Charitable gift annuities. Freetaxusa2012 Railroad retirement, Railroad retirement annuities. Freetaxusa2012 Tax-sheltered, Limit for tax-sheltered annuities. Freetaxusa2012 Archer MSAs, Archer MSA contributions. Freetaxusa2012 , Medical savings accounts (Archer MSAs and Medicare Advantage MSAs). Freetaxusa2012 Armed forces, Military Combat zone bonus, Veterans' benefits. Freetaxusa2012 Disability, Disability. Freetaxusa2012 Disability pensions, Military and Government Disability Pensions Health professions scholarship, Tuition Reduction Military action as cause of disability injuries, Terrorist attack or military action. Freetaxusa2012 Qualified reservist distribution, Qualified reservist distribution (QRD). Freetaxusa2012 Rehabilitative program payments, Veterans' benefits. Freetaxusa2012 Retirement pay, Military retirement pay. Freetaxusa2012 Veterans benefits, Veterans' benefits. Freetaxusa2012 Assistance (see Tax help) Athletic facilities, employer-provided, Athletic Facilities Automobile (see Vehicle, employer-provided) Awards (see Damages from lawsuits) B Babysitting, Babysitting. Freetaxusa2012 Back pay, award for, Back pay awards. Freetaxusa2012 Backup withholding Barter exchange transactions, Backup withholding. Freetaxusa2012 Bankruptcy Canceled debt not deemed to be income, Excluded debt. Freetaxusa2012 Barter income, Bartering Below-market loans, Below-market loans. Freetaxusa2012 Bequest for services, Bequest for services. Freetaxusa2012 Bicycle, Transportation Fringe benefit, Qualified bicycle commuting. Freetaxusa2012 Black lung benefit payments, Black lung benefit payments. Freetaxusa2012 Bonuses, Bonuses and awards. Freetaxusa2012 , Employee awards or bonuses. Freetaxusa2012 Breach of contract Damages as income, Court awards and damages. Freetaxusa2012 Bribes, Bribes. Freetaxusa2012 Business expenses Reimbursements, Allowances and reimbursements. Freetaxusa2012 Business income, Business and Investment Income, More information. Freetaxusa2012 C Cafeteria plans, Cafeteria plans. Freetaxusa2012 Campaign contributions, Campaign contributions. Freetaxusa2012 Campus lodging, Qualified campus lodging. Freetaxusa2012 , Moving Expense Reimbursements Cancellation of debt, Canceled Debts Cancellation of sales contracts, Canceled sales contract. Freetaxusa2012 Capital gains Recoveries, Capital gains. Freetaxusa2012 , Capital gains. Freetaxusa2012 Capital gains or losses Employee stock option plans (ESOPs), Option granted at a discount. Freetaxusa2012 Incentive stock options (ISOs), Incentive stock options (ISOs). Freetaxusa2012 Sale of personal property, Sale of personal items. Freetaxusa2012 Car (see Vehicle, employer-provided) Car pools, Car pools. Freetaxusa2012 Cash or deferred arrangements (CODAs), Elective Deferrals Cash rebates, Cash rebates. Freetaxusa2012 Casualty insurance Reimbursements from, Casualty insurance and other reimbursements. Freetaxusa2012 Catch-up contributions, Catch-up contributions. Freetaxusa2012 , Catch-up contributions. Freetaxusa2012 Charitable gift annuities, Charitable gift annuities. Freetaxusa2012 Child and Adult Care Food Program Payments to daycare providers, Food program payments to daycare providers. Freetaxusa2012 Child support payments, Child support payments. Freetaxusa2012 Childcare providers, Childcare providers. Freetaxusa2012 , Food program payments to daycare providers. Freetaxusa2012 Chronic illness, Chronically ill individual. Freetaxusa2012 Accelerated death benefits paid to, Exclusion for chronic illness. Freetaxusa2012 Citizens outside U. Freetaxusa2012 S. Freetaxusa2012 Exclusion of foreign income, Reminders Civil Rights Act of 1964, Title VII Back pay and damages for emotional distress under, Court awards and damages. Freetaxusa2012 Clergy, Clergy Coal, Coal and iron ore. Freetaxusa2012 Colleges and universities Faculty lodging, Faculty lodging. Freetaxusa2012 Scholarships and fellowships, Scholarships and fellowships. Freetaxusa2012 Commissions Advance, Miscellaneous Compensation Commuter highway vehicles, Transportation Compensation Employee, Employee Compensation Miscellaneous, Miscellaneous Compensation Unemployment, Unemployment compensation. Freetaxusa2012 Workers', Workers' Compensation Compensatory damages, Other compensation. Freetaxusa2012 , Court awards and damages. Freetaxusa2012 Constructive receipt of income, Constructively received income. Freetaxusa2012 Copyrights Infringement damages, Court awards and damages. Freetaxusa2012 Royalties, Copyrights and patents. Freetaxusa2012 Corporate directors, Corporate director. Freetaxusa2012 Cost-of-living allowances, Government cost-of-living allowances. Freetaxusa2012 Court awards, Court awards and damages. Freetaxusa2012 (see also Damages from lawsuits) Credit card Insurance, Credit card insurance. Freetaxusa2012 Credits Recoveries, refiguring of unused credits, Unused tax credits. Freetaxusa2012 , Unused tax credits. Freetaxusa2012 Currency transactions, foreign, Foreign currency transactions. Freetaxusa2012 D Damages from lawsuits, Court awards and damages. Freetaxusa2012 Back pay awards, Back pay awards. Freetaxusa2012 Breach of contract, Court awards and damages. Freetaxusa2012 Compensatory damages, Other compensation. Freetaxusa2012 , Court awards and damages. Freetaxusa2012 Emotional distress under Title VII, Civil Rights Act of 1964, Court awards and damages. Freetaxusa2012 Punitive damages, Court awards and damages. Freetaxusa2012 Daycare providers, Childcare providers. Freetaxusa2012 (see also Childcare providers) Food program payments to, Food program payments to daycare providers. Freetaxusa2012 De minimis benefits, De Minimis (Minimal) Benefits, Meals and Lodging Death benefits, Proceeds not received in installments. Freetaxusa2012 (see also Life insurance) Accelerated, Accelerated Death Benefits Debts Canceled, Canceled Debts Excluded debt, Excluded debt. Freetaxusa2012 Nonrecourse debts, Mortgage relief upon sale or other disposition. Freetaxusa2012 Recourse, Mortgage relief upon sale or other disposition. Freetaxusa2012 Stockholder's, Stockholder debt. Freetaxusa2012 Deduction Costs of discrimination suits, Deduction for costs involved in unlawful discrimination suits. Freetaxusa2012 Deferred compensation Nonqualified plans, Nonqualified deferred compensation plans. Freetaxusa2012 , Nonqualified deferred compensation plans of nonqualified entities. Freetaxusa2012 Dependent care benefits, Dependent Care Benefits Depletion allowance, Depletion. Freetaxusa2012 Differential wage payments, Differential wage payments. Freetaxusa2012 Armed forces, Differential wage payments. Freetaxusa2012 Directors' fees, Corporate director. Freetaxusa2012 Disability Military, Disability. Freetaxusa2012 Pensions, Disability Pensions Workers' compensation, Disability pension. Freetaxusa2012 Person with, Persons with disabilities. Freetaxusa2012 Unemployment compensation, paid as substitute for, Types of unemployment compensation. Freetaxusa2012 Disaster relief Disaster mitigation payments, Disaster mitigation payments. Freetaxusa2012 Disaster Relief and Emergency Assistance Act Grants, Disaster relief grants. Freetaxusa2012 Unemployment benefits, Unemployment Benefits Mitigation payments, Reminders Payments, Disaster relief payments. Freetaxusa2012 Discounts Employee discounts, Employee Discounts Employee stock purchase plans, Option granted at a discount. Freetaxusa2012 Mortgage loan for early payment, Discounted mortgage loan. Freetaxusa2012 Dividends Restricted stock, Dividends received on restricted stock. Freetaxusa2012 Divorced taxpayers Stock options exercised incident to divorce, Tax form. Freetaxusa2012 Down payment assistance, Down payment assistance. Freetaxusa2012 E Educational assistance Employer-provided, Educational Assistance Scholarships and fellowships, Scholarships and fellowships. Freetaxusa2012 Educational institutions Faculty lodging, Faculty lodging. Freetaxusa2012 Elderly persons Nutrition Program for the Elderly, Nutrition Program for the Elderly. Freetaxusa2012 Tax Counseling for the Elderly, Volunteer tax counseling. Freetaxusa2012 Election precinct officials, Election precinct official. Freetaxusa2012 Elective deferrals, Elective Deferrals Catch-up contributions, Catch-up contributions. Freetaxusa2012 , Catch-up contributions. Freetaxusa2012 Excess annual additions, Excess Annual Additions Excess contributions, Excess Contributions Excess deferrals, Excess deferrals. Freetaxusa2012 Increased limit for last 3 years prior to retirement age, Increased limit. Freetaxusa2012 Limit on, Elective Deferrals Reporting by employer, Reporting by employer. Freetaxusa2012 Emergency Homeowners' Loan Program, Hardest Hit Fund and Emergency Homeowners' Loan Program. Freetaxusa2012 Emotional distress damages, Emotional distress. Freetaxusa2012 Employee achievement awards, Employee achievement award. Freetaxusa2012 Employee awards or bonuses, Employee awards or bonuses. Freetaxusa2012 Employee compensation, Employee Compensation, Inherited property not substantially vested. Freetaxusa2012 Fringe benefits, Fringe Benefits, Special valuation rules. Freetaxusa2012 Restricted property, Restricted Property, Inherited property not substantially vested. Freetaxusa2012 Retirement plan contributions, Retirement Plan Contributions Stock options, Stock Options, Statutory Stock Options Employee discounts, Employee Discounts Employee stock purchase plans, Statutory Stock Options, Employee stock purchase plan. Freetaxusa2012 Employer, foreign, Foreign Employer Employer-owned life insurance, Employer-owned life insurance contract. Freetaxusa2012 Employer-provided Educational assistance, Educational Assistance Vehicles, Employer-provided vehicles. Freetaxusa2012 Employment Abroad, Employment abroad. Freetaxusa2012 Agency fees, Employment agency fees. Freetaxusa2012 Contracts Severance pay for cancellation of, Severance pay. Freetaxusa2012 Endowment proceeds, Endowment Contract Proceeds Energy Assistance, Payments to reduce cost of winter energy. Freetaxusa2012 Conservation Subsidies, Energy conservation subsidies. Freetaxusa2012 Utility rebates, Utility rebates. Freetaxusa2012 Estate income, Estate and trust income. Freetaxusa2012 Estimated tax Unemployment compensation, Tax withholding. Freetaxusa2012 Excess Annual additions, Excess Annual Additions Contributions, Excess Contributions Deferrals, Excess deferrals. Freetaxusa2012 Expected inheritance, Expected inheritance. Freetaxusa2012 Expenses paid by another, Expenses paid by another. Freetaxusa2012 Exxon Valdez settlement, Exxon Valdez settlement income. Freetaxusa2012 Eligible retirement plan, Contributions to eligible retirement plan. Freetaxusa2012 Income averaging, Income averaging. Freetaxusa2012 Legal expenses, Legal expenses. Freetaxusa2012 Reporting requirement-statement, Statement. Freetaxusa2012 F Faculty lodging, Faculty lodging. Freetaxusa2012 Fair market value (FMV), Fair market value. Freetaxusa2012 Stock options, Grant of option. Freetaxusa2012 Farming Qualified farm debt, cancellation of, Excluded debt. Freetaxusa2012 Federal employees Accrued leave payment, Accrued leave payment. Freetaxusa2012 Cost-of-living allowances, Government cost-of-living allowances. Freetaxusa2012 Disability pensions, Military and Government Disability Pensions Thrift Savings Plan for, Elective Deferrals Federal Employees Compensation Act (FECA) payments, Federal Employees' Compensation Act (FECA). Freetaxusa2012 Federal income tax Refunds, Federal income tax refund. Freetaxusa2012 Fees for services, Fees for services. Freetaxusa2012 Financial counseling fees, Financial Counseling Fees Fellowships, Scholarships and fellowships. Freetaxusa2012 FICA withholding Foreign employers, U. Freetaxusa2012 S. Freetaxusa2012 citizens working for in U. Freetaxusa2012 S. Freetaxusa2012 , Social security and Medicare taxes. Freetaxusa2012 Paid by employer, Social security and Medicare taxes paid by employer. Freetaxusa2012 Fiduciaries Fees for services, Fees for services. Freetaxusa2012 , Personal representatives. Freetaxusa2012 Financial counseling fees, Financial Counseling Fees (see also Retirement planning services) Fitness programs Employer-provided, Athletic Facilities Flights Employer-provided aircraft, Flights on employer-provided aircraft. Freetaxusa2012 No-additional-cost services, No-Additional-Cost Services Food benefits Daycare providers, food program payments to, Food program payments to daycare providers. Freetaxusa2012 Nutrition Program for the Elderly, Nutrition Program for the Elderly. Freetaxusa2012 Foreign Currency transactions, Foreign currency transactions. Freetaxusa2012 Employment, Foreign Employer Governments, employees of, Employees of international organizations or foreign governments. Freetaxusa2012 Income, Reminders Service, Service-connected disability. Freetaxusa2012 Form 1040 Excess contributions to elective deferrals, Excess Contributions Recoveries, Where to report. Freetaxusa2012 Unemployment compensation, Unemployment Benefits Wages from Form W-2, Employee Compensation Form 1040 or 1040A, Schedule B Restricted stock dividends, Stock you chose to include in your income. Freetaxusa2012 Form 1040, Schedule A Outplacement services, deduction for, Outplacement services. Freetaxusa2012 Repayment of commissions paid in advance, Advance commissions and other earnings. Freetaxusa2012 Form 1040, Schedule C Bartering, Bartering Childcare providers to use, Childcare providers. Freetaxusa2012 Personal property rental, reporting income from, Reporting business income and expenses. Freetaxusa2012 Royalties, Royalties Form 1040, Schedule C-EZ Bartering, Bartering Childcare Providers to use, Childcare providers. Freetaxusa2012 Personal property rental, reporting income from, Reporting business income and expenses. Freetaxusa2012 Royalties, Royalties Form 1040, Schedule D Stock options, Sale of the stock. Freetaxusa2012 Stock options reported on, Statutory Stock Options Form 1040, Schedule E Partner's return, Partner's return. Freetaxusa2012 Royalties, Royalties Form 1040A Recoveries, Where to report. Freetaxusa2012 Unemployment compensation, Unemployment Benefits Wages from Form W-2, Employee Compensation Form 1040EZ Recoveries, Where to report. Freetaxusa2012 Unemployment compensation, Unemployment Benefits Wages from Form W-2, Employee Compensation Form 1041 Estates and trusts, Estate and trust income. Freetaxusa2012 Form 1041, Schedule K-1 Beneficiary's share of income, deductions, credits, etc. Freetaxusa2012 , Estate and trust income. Freetaxusa2012 Form 1065 Partnership return, Partnership return. Freetaxusa2012 Form 1065, Schedule K-1 Partner's share of income, Schedule K-1 (Form 1065). Freetaxusa2012 , Partnership Income Form 1098 Mortgage interest statement, Mortgage interest refund. Freetaxusa2012 Form 1099-B Barter exchange transactions, Form 1099-B from barter exchange. Freetaxusa2012 , Backup withholding. Freetaxusa2012 Form 1099-C Cancellation of debt, Form 1099-C. Freetaxusa2012 Form 1099-DIV Restricted stock dividends, Stock you chose to include in your income. Freetaxusa2012 Form 1099-G State tax refunds, State tax refund. Freetaxusa2012 Unemployment compensation, Unemployment Benefits Form 1099-MISC Services totaling $600 or more, Fees for services. Freetaxusa2012 Stock options exercised incident to divorce, Tax form. Freetaxusa2012 Form 1099-R Charitable gift annuities, Charitable gift annuities. Freetaxusa2012 Excess annual additions, Excess Annual Additions Excess deferral amounts, Excess distributed to you. Freetaxusa2012 Surrender of life insurance policy for cash, Surrender of policy for cash. Freetaxusa2012 Form 1120-POL Political organizations, Campaign contributions. Freetaxusa2012 Form 1120S S corporation return, S corporation return. Freetaxusa2012 Form 1120S, Schedule K-1 Shareholder's share of income, credits, deductions, etc. Freetaxusa2012 , Schedule K-1 (Form 1120S). Freetaxusa2012 Form 2441 Child and dependent care expenses, Dependent Care Benefits Form 4255 Recapture of investment credit, Amounts Recovered for Credits Form 6251 Alternative minimum tax, Alternative minimum tax (AMT). Freetaxusa2012 Form 8839 Adoption assistance, Adoption Assistance Form 8853 Accelerated death benefits, Form 8853. Freetaxusa2012 Archer MSAs and long-term care insurance contracts, Archer MSA contributions. Freetaxusa2012 Form 8919 Uncollected social security and Medicare tax on wages, Employee Compensation Form RRB-1099 Railroad retirement board payments, Form RRB-1099. Freetaxusa2012 Form SSA-1099 Social security benefit statement, Form SSA-1099. Freetaxusa2012 Form W-2 501(c)(18)(D) contributions, Section 501(c)(18)(D) contributions. Freetaxusa2012 Accrued leave payment at time of retirement or resignation, Accrued leave payment. Freetaxusa2012 Back pay awards, Back pay awards. Freetaxusa2012 Bonuses or awards, Bonuses and awards. Freetaxusa2012 Elective deferrals, reporting by employer, Reporting by employer. Freetaxusa2012 Failure to receive from employer, Employee Compensation Fringe benefits reported on, Form W-2. Freetaxusa2012 Stock options from employers, Tax form. Freetaxusa2012 Wage and tax statement, Employee Compensation Form W-2G Gambling winnings, Form W-2G. Freetaxusa2012 Form W-4V Unemployment compensation, voluntary withholding request, Tax withholding. Freetaxusa2012 Form W-9 Request for taxpayer identification number, Backup withholding. Freetaxusa2012 Foster care, Foster care providers. Freetaxusa2012 Foster Grandparent Program, National Senior Service Corps programs. Freetaxusa2012 Found property, Found property. Freetaxusa2012 Free tax services, Free help with your tax return. Freetaxusa2012 Fringe benefits, Fringe Benefits, Special valuation rules. Freetaxusa2012 Accident and health insurance, Accident or Health Plan Adoption, employer assistance, Adoption Assistance Athletic facilities, Athletic Facilities Commuter highway vehicles, Transportation De minimis benefits, De Minimis (Minimal) Benefits, Meals and Lodging Dependent care benefits, Dependent Care Benefits Educational assistance, Educational Assistance Employee discounts, Employee Discounts Faculty lodging, Faculty lodging. Freetaxusa2012 Financial counseling fees, Financial Counseling Fees Holiday gifts, Holiday gifts. Freetaxusa2012 Meals and lodging, Meals and Lodging Moving expenses (see Moving expenses) No-additional-cost services, No-Additional-Cost Services Parking, Transportation Retirement planning (see Retirement planning services) Transit pass, Transportation, Transit pass. Freetaxusa2012 Tuition reduction, Tuition Reduction Valuation of, Valuation of Fringe Benefits, Special valuation rules. Freetaxusa2012 Vehicle, Employer-provided vehicles. Freetaxusa2012 Working condition benefits, Working Condition Benefits Frozen deposits Interest on, Interest on frozen deposits. Freetaxusa2012 G Gambling winnings and losses, Gambling winnings. Freetaxusa2012 Gas Royalties from, Oil, gas, and minerals. Freetaxusa2012 Gifts, Gifts and inheritances. Freetaxusa2012 Holiday gifts from employer, Holiday gifts. Freetaxusa2012 Government employees (see Federal employees; State employees) Grantor trusts, Grantor trust. Freetaxusa2012 Group-term life insurance Worksheets, Figuring the taxable cost. Freetaxusa2012 , Worksheet 1. Freetaxusa2012 Figuring the Cost of Group-Term Life Insurance To Include in Income—Illustrated Gulf oil spill, Reminders, Gulf oil spill. Freetaxusa2012 H HAMP Home affordable modification program Pay-for-performance success payments, Home Affordable Modification Program (HAMP). Freetaxusa2012 Hardest Hit Fund Program, Hardest Hit Fund and Emergency Homeowners' Loan Program. Freetaxusa2012 Health Flexible spending arrangement, Health flexible spending arrangement (health FSA). Freetaxusa2012 Insurance, Accident or Health Plan Reimbursement arrangement, Health reimbursement arrangement (HRA). Freetaxusa2012 Savings account, Health savings accounts (HSA). Freetaxusa2012 Help (see Tax help) Highly compensated employees Excess contributions to elective deferrals, Excess Contributions Historic preservation grants, Historic preservation grants. Freetaxusa2012 Hobby losses, Hobby losses. Freetaxusa2012 Holding period requirement, Holding period requirement. Freetaxusa2012 Holiday gifts, Holiday gifts. Freetaxusa2012 Holocaust victims restitution, Holocaust victims restitution. Freetaxusa2012 Home, sale of, Sale of home. Freetaxusa2012 Host or hostess, Host or Hostess Hotels No-additional-cost services, No-Additional-Cost Services Housing (see Lodging) I Illegal activities, Illegal activities. Freetaxusa2012 Incentive stock options (ISOs), Statutory Stock Options, Incentive stock options (ISOs). Freetaxusa2012 Income Assigned, Assignment of income. Freetaxusa2012 Business and investment, Business and Investment Income, More information. Freetaxusa2012 Constructive receipt of, Constructively received income. Freetaxusa2012 Estate and trust, Estate and trust income. Freetaxusa2012 Foreign employers, Foreign Employer Illegal, Illegal activities. Freetaxusa2012 Miscellaneous, Miscellaneous Income Other, Other Income Partnership, Partnership Income Prepaid, Prepaid income. Freetaxusa2012 S corporation, S Corporation Income Indian fishing rights, Indian fishing rights. Freetaxusa2012 Indian money account, Indian money account litigation settlement. Freetaxusa2012 Individual retirement arrangements (IRAs) Deduction, Benefits may affect your IRA deduction. Freetaxusa2012 Inherited IRA, Inherited pension or IRA. Freetaxusa2012 Inheritance, Gifts and inheritances. Freetaxusa2012 IRA, Inherited pension or IRA. Freetaxusa2012 Property not substantially vested, Inherited property not substantially vested. Freetaxusa2012 Injury benefits, Sickness and Injury Benefits, Reimbursement for medical care. Freetaxusa2012 Insurance Credit card, Credit card insurance. Freetaxusa2012 Health, Accident or Health Plan Life (see Life insurance) Long-term care (see Long-term care insurance) Interest Canceled debt including, Interest included in canceled debt. Freetaxusa2012 Frozen deposits, Interest on frozen deposits. Freetaxusa2012 Mortgage refunds, Mortgage interest refund. Freetaxusa2012 Option on insurance, Interest option on insurance. Freetaxusa2012 Recovery amounts, Interest on recovery. Freetaxusa2012 Savings bond, Interest on qualified savings bonds. Freetaxusa2012 State and local government obligations, Interest on state and local government obligations. Freetaxusa2012 Interference with business operations Damages as income, Court awards and damages. Freetaxusa2012 International organizations, employees of, Foreign Employer Interview expenses, Job interview expenses. Freetaxusa2012 Investment counseling fees, Financial Counseling Fees (see also Retirement planning services) Investment income, Business and Investment Income, More information. Freetaxusa2012 IRAs (see Individual retirement arrangements (IRAs)) Iron ore, Coal and iron ore. Freetaxusa2012 Itemized deductions Limited, Itemized deductions limited. Freetaxusa2012 Recoveries, Recoveries, Itemized Deduction Recoveries J Job interview expenses, Job interview expenses. Freetaxusa2012 Joint returns Social security benefits or railroad retirement payments, Joint return. Freetaxusa2012 Joint state/local tax return Recoveries, Joint state or local income tax return. Freetaxusa2012 Jury duty pay, Jury duty. Freetaxusa2012 K Kickbacks, Kickbacks. Freetaxusa2012 L Labor unions Convention expenses, reimbursed, Reimbursed union convention expenses. Freetaxusa2012 Dues, Union benefits and dues. Freetaxusa2012 Strike and lockout benefits, Strike and lockout benefits. Freetaxusa2012 Unemployment benefits paid from, Payments by a union. Freetaxusa2012 Last day of tax year, income received on, Constructively received income. Freetaxusa2012 Leave (see Accrued leave payment) Length-of-service awards, Employee achievement award. Freetaxusa2012 Life insurance Employer-owned, Employer-owned life insurance contract. Freetaxusa2012 Proceeds, Life Insurance Proceeds Surrender of policy for cash, Surrender of policy for cash. Freetaxusa2012 Loans, Discounted mortgage loan. Freetaxusa2012 (see also Mortgage) Below-market, Below-market loans. Freetaxusa2012 Student, Student loans. Freetaxusa2012 Lockout benefits, Strike and lockout benefits. Freetaxusa2012 Lodging Campus lodging, Qualified campus lodging. Freetaxusa2012 , Moving Expense Reimbursements Clergy, Housing Employer-paid or reimbursed, Meals and Lodging Faculty lodging, Faculty lodging. Freetaxusa2012 Replacement housing payments, Replacement housing payments. Freetaxusa2012 Long-term care insurance, Long-term care coverage. Freetaxusa2012 , Long-Term Care Insurance Contracts Lotteries and raffles, Lotteries and raffles. Freetaxusa2012 Lump-sum distributions Survivor benefits, Lump-sum payments. Freetaxusa2012 M Manufacturer incentive payments, Manufacturer incentive payments. Freetaxusa2012 Meals Employer-paid or reimbursed, Meals and Lodging Nutrition Program for the Elderly, Nutrition Program for the Elderly. Freetaxusa2012 Medical Care reimbursements, Reimbursement for medical care. Freetaxusa2012 Savings accounts, Medical savings accounts (Archer MSAs and Medicare Advantage MSAs). Freetaxusa2012 Medicare Advantage MSAs, Medical savings accounts (Archer MSAs and Medicare Advantage MSAs). Freetaxusa2012 Benefits, Medicare. Freetaxusa2012 Tax paid by employer, Social security and Medicare taxes paid by employer. Freetaxusa2012 Medicare tax (see Social security and Medicare taxes) Military (see Armed forces) Minerals Royalties from, Oil, gas, and minerals. Freetaxusa2012 Miscellaneous Compensation, Miscellaneous Compensation Income, Miscellaneous Income Missing children, photographs of, Reminders Mortgage Assistance payment (under sec. Freetaxusa2012 235 of National Housing Act), Mortgage assistance payments under section 235 of the National Housing Act. Freetaxusa2012 Discounted loan, Discounted mortgage loan. Freetaxusa2012 Interest refund, Mortgage interest refund. Freetaxusa2012 Qualified principal residence indebtedness, Qualified principal residence indebtedness (QPRI). Freetaxusa2012 Relief, Mortgage relief upon sale or other disposition. Freetaxusa2012 Motor vehicle, employer-provided, Employer-provided vehicles. Freetaxusa2012 Moving expenses Reimbursements, Allowances and reimbursements. Freetaxusa2012 , Moving expense reimbursements. Freetaxusa2012 MSAs (Medical savings accounts), Medical savings accounts (Archer MSAs and Medicare Advantage MSAs). Freetaxusa2012 N National Health Service Corps Scholarship Program, Tuition Reduction National Oceanic and Atmospheric Administration, Service-connected disability. Freetaxusa2012 National Senior Service Corps, National Senior Service Corps programs. Freetaxusa2012 No-additional-cost services, No-Additional-Cost Services No-fault car insurance Disability benefits under, Other compensation. Freetaxusa2012 Nobel prize, Pulitzer, Nobel, and similar prizes. Freetaxusa2012 Nonrecourse debt, Mortgage relief upon sale or other disposition. Freetaxusa2012 Nonstatutory stock options, Nonstatutory Stock Options Nontaxable income, Introduction Not-for-profit activities, Activity not for profit. Freetaxusa2012 Notary fees, Notary public. Freetaxusa2012 Notes received for services, Note received for services. Freetaxusa2012 Nutrition Program for the Elderly, Nutrition Program for the Elderly. Freetaxusa2012 O Oil Royalties from, Oil, gas, and minerals. Freetaxusa2012 Old-age, survivors, and disability insurance benefits (OASDI), Old-age, survivors, and disability insurance benefits (OASDI). Freetaxusa2012 Options, stock, Stock Options, Statutory Stock Options Outplacement services, Outplacement services. Freetaxusa2012 Overseas work, Reminders P Parking fees Employer-paid or reimbursed, Transportation, Qualified parking. Freetaxusa2012 Partner and partnership income, Partnership Income Patents Infringement damages, Court awards and damages. Freetaxusa2012 Royalties, Copyrights and patents. Freetaxusa2012 Peace Corps, Peace Corps. Freetaxusa2012 Pensions Clergy, Pension. Freetaxusa2012 Disability pensions, Disability Pensions Inherited pensions, Inherited pension or IRA. Freetaxusa2012 Military, Military retirement pay. Freetaxusa2012 Personal property Rental income and expense, Rents From Personal Property Sale of, Sale of personal items. Freetaxusa2012 Personal representatives (see Fiduciaries) Prepaid income, Prepaid income. Freetaxusa2012 Price reduced after purchase, Price reduced after purchase. Freetaxusa2012 Prizes and awards, Bonuses and awards. Freetaxusa2012 , Prizes and awards. Freetaxusa2012 Achievement awards, Employee achievement award. Freetaxusa2012 Employee awards or bonuses, Employee awards or bonuses. Freetaxusa2012 Length-of-service awards, Employee achievement award. Freetaxusa2012 Pulitzer, Nobel, and similar prizes, Pulitzer, Nobel, and similar prizes. Freetaxusa2012 Safety achievement, Employee achievement award. Freetaxusa2012 Scholarship prizes, Prizes. Freetaxusa2012 Profit-sharing plan, Retirement and profit-sharing plans. Freetaxusa2012 Public assistance benefits, Welfare and Other Public Assistance Benefits Public Health Service, Service-connected disability. Freetaxusa2012 Public safety officers killed in line of duty, Public safety officer killed in the line of duty. Freetaxusa2012 Public transportation passes, employer-provided, Transportation, Transit pass. Freetaxusa2012 Publications (see Tax help) Pulitzer prize, Pulitzer, Nobel, and similar prizes. Freetaxusa2012 Punitive damages, Court awards and damages. Freetaxusa2012 Q Qualified joint venture, Reminders Qualified tuition program (QTP), Qualified tuition program (QTP). Freetaxusa2012 R Raffles, Lotteries and raffles. Freetaxusa2012 Railroad Retirement annuities, Railroad retirement annuities. Freetaxusa2012 Retirement benefits, Social security and equivalent railroad retirement benefits. Freetaxusa2012 Sick pay, Railroad sick pay. Freetaxusa2012 Unemployment compensation benefits, Types of unemployment compensation. Freetaxusa2012 Real estate Qualified real property business debt, cancellation of, Excluded debt. Freetaxusa2012 Rebates Cash, Cash rebates. Freetaxusa2012 Utility, Utility rebates. Freetaxusa2012 Recovery of amounts previously deducted, Recoveries, Standard deduction for earlier years. Freetaxusa2012 Itemized deductions, Recoveries, Itemized Deduction Recoveries Non-itemized deductions, Non-Itemized Deduction Recoveries Unused tax credits, refiguring of, Unused tax credits. Freetaxusa2012 , Unused tax credits. Freetaxusa2012 Refunds Federal income tax, Federal income tax refund. Freetaxusa2012 Mortgage interest, Mortgage interest refund. Freetaxusa2012 State tax, State tax refund. Freetaxusa2012 Rehabilitative program payments, Veterans' benefits. Freetaxusa2012 Reimbursements Business expenses, Allowances and reimbursements. Freetaxusa2012 Casualty losses, Casualty insurance and other reimbursements. Freetaxusa2012 Meals and lodging, Meals and Lodging Medical expenses, Reimbursement for medical care. Freetaxusa2012 Moving expenses, Allowances and reimbursements. Freetaxusa2012 , Moving expense reimbursements. Freetaxusa2012 Related party transactions Stock option transfer, Transfer in non-arm's-length transaction. Freetaxusa2012 Religious order members, Members of Religious Orders Rental income and expenses Personal property rental, Rents From Personal Property Reporting of, Reporting business income and expenses. Freetaxusa2012 Repayments, Repayments, Year of deduction (or credit). Freetaxusa2012 Repossession, Canceled sales contract. Freetaxusa2012 Restricted property, Restricted Property, Inherited property not substantially vested. Freetaxusa2012 Retired Senior Volunteer Program (RSVP), National Senior Service Corps programs. Freetaxusa2012 Retirement Settlement, Reminders Retirement planning services, Financial Counseling Fees, Retirement Planning Services Retirement plans, Military retirement pay. Freetaxusa2012 (see also Pensions) Automatic contribution arrangements, Qualified automatic contribution arrangements. Freetaxusa2012 Contributions, Retirement Plan Contributions, Excess Annual Additions, Statutory Stock Options Elective deferrals (see Elective deferrals) Rewards, Rewards. Freetaxusa2012 Roth contributions, Designated Roth contributions. Freetaxusa2012 Royalties, Royalties S S corporations, S Corporation Income Safety achievement awards, Employee achievement award. Freetaxusa2012 Salary reduction simplified employee pension plans (see SARSEPs) Sale of home, Sale of home. Freetaxusa2012 Sales contracts Cancellation of, Canceled sales contract. Freetaxusa2012 SARSEPs, Elective Deferrals Excess contributions, Excess Contributions Savings bonds, Interest on qualified savings bonds. Freetaxusa2012 Savings incentive match plans for employees (see SIMPLE plans) Scholarships and fellowships, Scholarships and fellowships. Freetaxusa2012 Self-employed persons U. Freetaxusa2012 S. Freetaxusa2012 citizens working for foreign employers in U. Freetaxusa2012 S. Freetaxusa2012 treated as, Social security and Medicare taxes. Freetaxusa2012 Senior Companion Program, National Senior Service Corps programs. Freetaxusa2012 Service Corps of Retired Executives (SCORE), Service Corps of Retired Executives (SCORE). Freetaxusa2012 Severance pay, Severance pay. Freetaxusa2012 Outplacement services, Outplacement services. Freetaxusa2012 Sick pay, Sick pay. Freetaxusa2012 Sickness and injury benefits, Sickness and Injury Benefits, Reimbursement for medical care. Freetaxusa2012 SIMPLE plans, Elective Deferrals Limit for deferrals under, Limit for deferrals under SIMPLE plans. Freetaxusa2012 Smallpox vaccine injuries, Smallpox vaccine injuries. Freetaxusa2012 Social security and Medicare taxes Foreign employers, U. Freetaxusa2012 S. Freetaxusa2012 citizens working for in U. Freetaxusa2012 S. Freetaxusa2012 , Social security and Medicare taxes. Freetaxusa2012 Paid by employer, Social security and Medicare taxes paid by employer. Freetaxusa2012 Social security benefits, Social security and equivalent railroad retirement benefits. Freetaxusa2012 Standard deduction Recoveries, Standard deduction limit. Freetaxusa2012 , Standard deduction for earlier years. Freetaxusa2012 State employees Unemployment benefits paid to, State employees. Freetaxusa2012 State or local governments Interest on obligations of, Interest on state and local government obligations. Freetaxusa2012 State or local taxes Refunds, State tax refund. Freetaxusa2012 Statutory stock option holding period, Sale of the stock. Freetaxusa2012 Stock appreciation rights, Stock appreciation rights. Freetaxusa2012 Stock options, Stock Options, Statutory Stock Options Stock options, nonstatutory Exercise or transfer, Exercise or transfer of option. Freetaxusa2012 Grant, Grant of option. Freetaxusa2012 Sale, Sale of the stock. Freetaxusa2012 Stock options, statutory Exercise, Exercise of option. Freetaxusa2012 Grant, Grant of option. Freetaxusa2012 Sale, Sale of the stock. Freetaxusa2012 Stockholder debts, Stockholder debt. Freetaxusa2012 Stolen property, Stolen property. Freetaxusa2012 Strike benefits, Strike and lockout benefits. Freetaxusa2012 Student loans Cancellation of debt, Student loans. Freetaxusa2012 Substantial risk of forfeiture, Substantial risk of forfeiture. Freetaxusa2012 Substantially vested property, Substantially vested. Freetaxusa2012 Supplemental security income (SSI) payments, Social security and equivalent railroad retirement benefits. Freetaxusa2012 Supplemental unemployment benefits, Supplemental unemployment benefits. Freetaxusa2012 Surviving spouse Life insurance proceeds paid to, Surviving spouse. Freetaxusa2012 Survivor benefits, Survivor Benefits T Tables and figures Group-term life insurance (Table 1), Group-Term Life Insurance Tax benefit rule, Tax benefit rule. Freetaxusa2012 Tax Counseling for the Elderly, Volunteer tax counseling. Freetaxusa2012 Tax help, How To Get Tax Help Tax-sheltered annuity plans (403(b) plans), Elective Deferrals Limit for, Limit for tax-sheltered annuities. Freetaxusa2012 Terminal illness, Exclusion for terminal illness. Freetaxusa2012 Terrorist attacks Disability payments for injuries from, Terrorist attack or military action. Freetaxusa2012 Victims of, tax relief, Reminders Thrift Savings Plan, Elective Deferrals Title VII, Civil Rights Act of 1964 Back pay and damages for emotional distress under, Court awards and damages. Freetaxusa2012 Tour guides, free tours for, Free tour. Freetaxusa2012 Trade Act of 1974 Trade readjustment allowances under, Types of unemployment compensation. Freetaxusa2012 , Repayment of benefits. Freetaxusa2012 Transferable property, Transferable property. Freetaxusa2012 Transit passes, Transportation, Transit pass. Freetaxusa2012 Travel agencies Free tour to organizer of group of tourists, Free tour. Freetaxusa2012 Travel and transportation expenses Free tours from travel agencies, Free tour. Freetaxusa2012 Fringe benefits, Transportation Reimbursements, Allowances and reimbursements. Freetaxusa2012 School children, transporting of, Transporting school children. Freetaxusa2012 Trusts Grantor trusts, Grantor trust. Freetaxusa2012 Income, Estate and trust income. Freetaxusa2012 Tuition program, qualified (QTP), Qualified tuition program (QTP). Freetaxusa2012 Tuition reduction, Tuition Reduction U Unemployment compensation, Unemployment Benefits Unions (see Labor unions) Unlawful discrimination suits Deduction for costs, Deduction for costs involved in unlawful discrimination suits. Freetaxusa2012 V VA payments, VA payments. Freetaxusa2012 Valuation Fringe benefits, Valuation of Fringe Benefits, Special valuation rules. Freetaxusa2012 Stock options, Nonstatutory Stock Options Vehicle Commuter highway, Commuter highway vehicle. Freetaxusa2012 Employer-provided, Employer-provided vehicles. Freetaxusa2012 Veterans benefits, Veterans' benefits. Freetaxusa2012 Disability compensation, Retroactive VA determination. Freetaxusa2012 Retroactive VA determination, Retroactive VA determination. Freetaxusa2012 Special statute of limitations. Freetaxusa2012 , Special statute of limitations. Freetaxusa2012 Viatical settlements, Viatical settlement. Freetaxusa2012 Volunteer work, Volunteers Tax counseling (Volunteer Income Tax Assistance Program), Volunteer tax counseling. Freetaxusa2012 Volunteers in Service to America (VISTA), Volunteers in Service to America (VISTA). Freetaxusa2012 W W-2 form (see Form W-2) Welfare benefits, Welfare and Other Public Assistance Benefits Whistleblower, Whistleblower's award. Freetaxusa2012 Winter energy payments, Payments to reduce cost of winter energy. Freetaxusa2012 Withholding Barter exchange transactions, Backup withholding. Freetaxusa2012 Unemployment compensation, Tax withholding. Freetaxusa2012 Work-training programs, Work-training program. Freetaxusa2012 Workers' compensation, Workers' Compensation Working condition benefits, Working Condition Benefits Worksheets Group-term life insurance (Worksheet 1), Figuring the taxable cost. Freetaxusa2012 , Worksheet 1. Freetaxusa2012 Figuring the Cost of Group-Term Life Insurance To Include in Income—Illustrated Prev  Up     Home   More Online Publications