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I Need To Amend My 2011 Taxes

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I Need To Amend My 2011 Taxes

I need to amend my 2011 taxes 1. I need to amend my 2011 taxes   Tax Withholding for 2014 Table of Contents Introduction Useful Items - You may want to see: Salaries and WagesDetermining Amount of Tax Withheld Using Form W-4 Completing Form W-4 and Worksheets Getting the Right Amount of Tax Withheld Rules Your Employer Must Follow Exemption From Withholding Supplemental Wages Penalties Tips Taxable Fringe BenefitsSpecial rule. I need to amend my 2011 taxes Exceptions. I need to amend my 2011 taxes Sick Pay Pensions and AnnuitiesPeriodic Payments Nonperiodic Payments Eligible Rollover Distributions Choosing Not To Have Income Tax Withheld Gambling WinningsException. I need to amend my 2011 taxes Identical wagers. I need to amend my 2011 taxes Unemployment Compensation Federal Payments Backup WithholdingTaxpayer identification number. I need to amend my 2011 taxes Underreported interest or dividends. I need to amend my 2011 taxes Introduction This chapter discusses income tax withholding on: Salaries and wages, Tips, Taxable fringe benefits, Sick pay, Pensions and annuities, Gambling winnings, Unemployment compensation, and Certain federal payments. I need to amend my 2011 taxes This chapter explains in detail the rules for withholding tax from each of these types of income. I need to amend my 2011 taxes The discussion of salaries and wages includes an explanation of how to complete Form W-4. I need to amend my 2011 taxes This chapter also covers backup withholding on interest, dividends, and other payments. I need to amend my 2011 taxes Useful Items - You may want to see: Form (and Instructions) W-4 Employee's Withholding Allowance Certificate W-4P Withholding Certificate for Pension or Annuity Payments W-4S Request for Federal Income Tax Withholding From Sick Pay W-4V Voluntary Withholding Request See chapter 5 of this publication for information about getting these publications and forms. I need to amend my 2011 taxes Salaries and Wages Income tax is withheld from the pay of most employees. I need to amend my 2011 taxes Your pay includes your regular pay, bonuses, commissions, and vacation allowances. I need to amend my 2011 taxes It also includes reimbursements and other expense allowances paid under a nonaccountable plan. I need to amend my 2011 taxes See Supplemental Wages , later, for definitions of accountable and nonaccountable plans. I need to amend my 2011 taxes If your income is low enough that you will not have to pay income tax for the year, you may be exempt from withholding. I need to amend my 2011 taxes This is explained under Exemption From Withholding , later. I need to amend my 2011 taxes You can ask your employer to withhold income tax from noncash wages and other wages not subject to withholding. I need to amend my 2011 taxes If your employer does not agree to withhold tax, or if not enough is withheld, you may have to pay estimated tax, as discussed in chapter 2. I need to amend my 2011 taxes Military retirees. I need to amend my 2011 taxes   Military retirement pay is treated in the same manner as regular pay for income tax withholding purposes, even though it is treated as a pension or annuity for other tax purposes. I need to amend my 2011 taxes Household workers. I need to amend my 2011 taxes   If you are a household worker, you can ask your employer to withhold income tax from your pay. I need to amend my 2011 taxes A household worker is an employee who performs household work in a private home, local college club, or local fraternity or sorority chapter. I need to amend my 2011 taxes   Tax is withheld only if you want it withheld and your employer agrees to withhold it. I need to amend my 2011 taxes If you do not have enough income tax withheld, you may have to pay estimated tax, as discussed in chapter 2. I need to amend my 2011 taxes Farmworkers. I need to amend my 2011 taxes   Generally, income tax is withheld from your cash wages for work on a farm unless your employer both: Pays you cash wages of less than $150 during the year, and Has expenditures for agricultural labor totaling less than $2,500 during the year. I need to amend my 2011 taxes Differential wage payments. I need to amend my 2011 taxes   When employees are on leave from employment for military duty, some employers make up the difference between the military pay and civilian pay. I need to amend my 2011 taxes Payments to an employee who is on active duty for a period of more than 30 days will be subject to income tax withholding, but not subject to social security or Medicare taxes. I need to amend my 2011 taxes The wages and withholding will be reported on Form W-2, Wage and Tax Statement. I need to amend my 2011 taxes Determining Amount of Tax Withheld Using Form W-4 The amount of income tax your employer withholds from your regular pay depends on two things. I need to amend my 2011 taxes The amount you earn in each payroll period. I need to amend my 2011 taxes The information you give your employer on Form W-4. I need to amend my 2011 taxes Form W-4 includes four types of information that your employer will use to figure your withholding. I need to amend my 2011 taxes Whether to withhold at the single rate or at the lower married rate. I need to amend my 2011 taxes How many withholding allowances you claim (each allowance reduces the amount withheld). I need to amend my 2011 taxes Whether you want an additional amount withheld. I need to amend my 2011 taxes Whether you are claiming an exemption from withholding in 2014. I need to amend my 2011 taxes See Exemption From Withholding , later. I need to amend my 2011 taxes Note. I need to amend my 2011 taxes You must specify a filing status and a number of withholding allowances on Form W-4. I need to amend my 2011 taxes You cannot specify only a dollar amount of withholding. I need to amend my 2011 taxes New Job When you start a new job, you must fill out a Form W-4 and give it to your employer. I need to amend my 2011 taxes Your employer should have copies of the form. I need to amend my 2011 taxes If you need to change the information later, you must fill out a new form. I need to amend my 2011 taxes If you work only part of the year (for example, you start working after the beginning of the year), too much tax may be withheld. I need to amend my 2011 taxes You may be able to avoid overwithholding if your employer agrees to use the part-year method. I need to amend my 2011 taxes See Part-Year Method , later, for more information. I need to amend my 2011 taxes Employee also receiving pension income. I need to amend my 2011 taxes   If you receive pension or annuity income and begin a new job, you will need to file Form W-4 with your new employer. I need to amend my 2011 taxes However, you can choose to split your withholding allowances between your pension and job in any manner. I need to amend my 2011 taxes Changing Your Withholding During the year changes may occur to your marital status, exemptions, adjustments, deductions, or credits you expect to claim on your tax return. I need to amend my 2011 taxes When this happens, you may need to give your employer a new Form W-4 to change your withholding status or number of allowances. I need to amend my 2011 taxes If the changes reduce the number of allowances you are allowed to claim or changes your marital status from married to single, you must give your employer a new Form W-4 within 10 days. I need to amend my 2011 taxes See Marital Status (Line 3 of Form W-4) and Withholding Allowances (Line 5 of Form W-4) , later. I need to amend my 2011 taxes Generally, you can submit a new Form W-4 whenever you wish to change your withholding allowances for any other reason. I need to amend my 2011 taxes See Table 1-1 for examples of personal and financial changes you should consider. I need to amend my 2011 taxes Table 1-1. I need to amend my 2011 taxes Personal and Financial Changes Factor Examples Lifestyle change Marriage Divorce Birth or adoption of child Loss of an exemption Purchase of a new home Retirement Filing chapter 11 bankruptcy Wage income You or your spouse start or stop working, or start or stop a second job Change in the amount of taxable income not subject to withholding Interest income Dividends Capital gains Self-employment income IRA (including certain Roth  IRA) distributions Change in the amount of adjustments to income IRA deduction Student loan interest deduction Alimony expense Change in the amount of itemized deductions or tax credits Medical expenses Taxes Interest expense Gifts to charity Job expenses Dependent care expenses Education credit Child tax credit Earned income credit If you change the number of your withholding allowances, you can request that your employer withhold using the Cumulative Wage Method , explained later. I need to amend my 2011 taxes Checking Your Withholding After you have given your employer a Form W-4, you can check to see whether the amount of tax withheld from your pay is too much or too little. I need to amend my 2011 taxes If too much or too little tax is being withheld, you should give your employer a new Form W-4 to change your withholding. I need to amend my 2011 taxes You can get a blank Form W-4 from your employer or print the form from IRS. I need to amend my 2011 taxes gov. I need to amend my 2011 taxes You should try to have your withholding match your actual tax liability. I need to amend my 2011 taxes If not enough tax is withheld, you will owe tax at the end of the year and may have to pay interest and a penalty. I need to amend my 2011 taxes If too much tax is withheld, you will lose the use of that money until you get your refund. I need to amend my 2011 taxes Always check your withholding if there are personal or financial changes in your life or changes in the law that might change your tax liability. I need to amend my 2011 taxes See Table 1-1 for examples. I need to amend my 2011 taxes Note. I need to amend my 2011 taxes You cannot give your employer a payment to cover federal income tax withholding on salaries and wages for past pay periods or a payment for estimated tax. I need to amend my 2011 taxes When Should You Check Your Withholding? The earlier in the year you check your withholding, the easier it is to get the right amount of tax withheld. I need to amend my 2011 taxes You should check your withholding when any of the following situations occur. I need to amend my 2011 taxes You receive a paycheck stub (statement) covering a full pay period in 2014, showing tax withheld based on 2014 tax rates. I need to amend my 2011 taxes You prepare your 2013 tax return and get a: Big refund, or Balance due that is: More than you can comfortably pay, or Subject to a penalty. I need to amend my 2011 taxes There are changes in your life or financial situation that affect your tax liability. I need to amend my 2011 taxes See Table 1-1. I need to amend my 2011 taxes There are changes in the tax law that affect your tax liability. I need to amend my 2011 taxes How Do You Check Your Withholding? You can use the worksheets and tables in this publication to see if you are having the right amount of tax withheld. I need to amend my 2011 taxes You can also use the IRS Withholding calculator at www. I need to amend my 2011 taxes irs. I need to amend my 2011 taxes gov/individuals. I need to amend my 2011 taxes If you use the worksheets and tables in this publication, follow these steps. I need to amend my 2011 taxes Fill out Worksheet 1-5 to project your total federal income tax liability for 2014. I need to amend my 2011 taxes Fill out Worksheet 1-7 to project your total federal withholding for 2014 and compare that with your projected tax liability from Worksheet 1-5. I need to amend my 2011 taxes If you are not having enough tax withheld, line 6 of Worksheet 1-7 will show you how much more to have withheld each payday. I need to amend my 2011 taxes For ways to increase the amount of tax withheld, see How Do You Increase Your Withholding? If line 5 of Worksheet 1-7 shows that you are having more tax withheld than necessary, see How Do You Decrease Your Withholding, for ways to decrease the amount of tax you have withheld each payday. I need to amend my 2011 taxes How Do You Increase Your Withholding? There are two ways to increase your withholding. I need to amend my 2011 taxes You can: Decrease the number of allowances you claim on Form W-4, or Enter an additional amount that you want withheld from each paycheck on Form W-4. I need to amend my 2011 taxes Requesting an additional amount withheld. I need to amend my 2011 taxes   You can request that an additional amount be withheld from each paycheck by following these steps. I need to amend my 2011 taxes Complete Worksheets 1-5 and 1-7. I need to amend my 2011 taxes Complete a new Form W-4 if the amount on Worksheet 1-7, line 5: Is more than you want to pay with your tax return or in estimated tax payments throughout the year, or Would cause you to pay a penalty when you file your tax return for 2014. I need to amend my 2011 taxes Enter on your new Form W-4, the same number of withholding allowances your employer now uses for your withholding. I need to amend my 2011 taxes This is the number of allowances you entered on the last Form W-4 you gave your employer. I need to amend my 2011 taxes Enter on your new Form W-4, the amount from Worksheet 1-7, line 6. I need to amend my 2011 taxes Give your newly completed Form W-4 to your employer. I need to amend my 2011 taxes   If you have this additional amount withheld from your pay each payday, you should avoid owing a large amount at the end of the year. I need to amend my 2011 taxes Example. I need to amend my 2011 taxes Early in 2014, Steve Miller used Worksheets 1-5, 1-6, and 1-7 to project his 2014 tax liability ($4,316) and his withholding for the year ($3,516). I need to amend my 2011 taxes Steve's tax will be underwithheld by $800 ($4,316 − $3,516). I need to amend my 2011 taxes His choices are to pay this amount when he files his 2014 tax return, make estimated tax payments, or increase his withholding now. I need to amend my 2011 taxes Steve gets a new Form W-4 from his employer, who tells him that there are 50 paydays remaining in 2014. I need to amend my 2011 taxes Steve completes the new Form W-4 as before, entering the same number of withholding allowances as before, but, in addition, entering $16 ($800 ÷ 50) on the form as the additional amount to be withheld from his pay each payday. I need to amend my 2011 taxes He gives the completed form to his employer. I need to amend my 2011 taxes What if I have more than one job or my spouse also has a job?   You are more likely to need to increase your withholding if you have more than one job or if you are married filing jointly and your spouse also works. I need to amend my 2011 taxes If this is the case, you can increase your withholding for one or more of the jobs. I need to amend my 2011 taxes   You can apply the amount on Worksheet 1-7, line 5, to only one job or divide it between the jobs any way you wish. I need to amend my 2011 taxes For each job, determine the extra amount that you want to apply to that job and divide that amount by the number of paydays remaining in 2014 for that job. I need to amend my 2011 taxes This will give you the additional amount to enter on the Form W-4 you will file for that job. I need to amend my 2011 taxes You need to give your employer a new Form W-4 for each job for which you are changing your withholding. I need to amend my 2011 taxes Example. I need to amend my 2011 taxes Meg Green works in a store and earns $46,000 a year. I need to amend my 2011 taxes Her husband, John, works full-time in manufacturing and earns $68,000 a year. I need to amend my 2011 taxes In 2014, they will also have $184 in taxable interest and $1,000 of other taxable income. I need to amend my 2011 taxes They expect to file a joint income tax return. I need to amend my 2011 taxes Meg and John complete Worksheets 1-5, 1-6, and 1-7. I need to amend my 2011 taxes Line 5 of Worksheet 1-7 shows that they will owe an additional $4,459 after subtracting their withholding for the year. I need to amend my 2011 taxes They can divide the $4,459 any way they want. I need to amend my 2011 taxes They can enter an additional amount on either of their Forms W-4, or divide it between them. I need to amend my 2011 taxes They decide to have the additional amount withheld from John's wages, so they enter $91 ($4,459 ÷ 49 remaining paydays) on his Form W-4. I need to amend my 2011 taxes Both claim the same number of allowances as before. I need to amend my 2011 taxes How Do You Decrease Your Withholding? If your completed Worksheets 1-5 and 1-7 show that you may have more tax withheld than your projected tax liability for 2014, you may be able to decrease your withholding. I need to amend my 2011 taxes There are two ways to do this. I need to amend my 2011 taxes You can: Decrease any additional amount you are having withheld, or Increase the number of allowances you claim on Form W-4. I need to amend my 2011 taxes You can claim only the number of allowances to which you are entitled. I need to amend my 2011 taxes To see if you can decrease your withholding by increasing your allowances, see the Form W-4 instructions and the rest of this publication. I need to amend my 2011 taxes Increasing the number of allowances. I need to amend my 2011 taxes   Figure and increase the number of withholding allowances you can claim as follows. I need to amend my 2011 taxes On a new Form W-4, complete the Personal Allowances Worksheet. I need to amend my 2011 taxes If you plan to itemize deductions, claim adjustments to income, or claim tax credits, complete a new Deductions and Adjustments Worksheet. I need to amend my 2011 taxes If you plan to claim tax credits, see Converting Credits to Withholding Allowances, later. I need to amend my 2011 taxes If you meet the criteria on line H of the Form W-4 Personal Allowances Worksheet, complete a new Two-Earners/Multiple Jobs Worksheet. I need to amend my 2011 taxes If the number of allowances you can claim on Form W-4, is different from the number you already are claiming, give the newly completed Form W-4 to your employer. I need to amend my 2011 taxes Converting Credits to Withholding Allowances Table 1-2 , later, shows many of the tax credits you may be able to use to decrease your withholding. I need to amend my 2011 taxes The Form W-4 Personal Allowances Worksheet provides only rough adjustments for the child and dependent care credit and the child tax credit. I need to amend my 2011 taxes Complete Worksheet 1-8 to figure these credits more accurately and also take other credits into account. I need to amend my 2011 taxes Include the amount from line 12 of Worksheet 1-8 in the total on line 5 of the Deductions and Adjustments Worksheet. I need to amend my 2011 taxes Then complete the Deductions and Adjustments Worksheet and the rest of Form W-4. I need to amend my 2011 taxes If you take the child and dependent care credit into account on Worksheet 1-8, enter -0- on line F of the Personal Allowances Worksheet. I need to amend my 2011 taxes If you take the child tax credit into account on Worksheet 1-8, enter -0- on line G of the Personal Allowances Worksheet. I need to amend my 2011 taxes Example. I need to amend my 2011 taxes Brett and Alyssa Davis are married and expect to file a joint return for 2014. I need to amend my 2011 taxes Their expected taxable income from all sources is $68,000. I need to amend my 2011 taxes They expect to have $15,900 of itemized deductions. I need to amend my 2011 taxes Their projected tax credits include a child and dependent care credit of $960 and an adoption credit of $1,500. I need to amend my 2011 taxes The Davis' complete Worksheet 1-8, as follows, to see whether they can convert their tax credits into additional withholding allowances. I need to amend my 2011 taxes Line 1, expected child and dependent care credit—$960. I need to amend my 2011 taxes Line 9, expected adoption credit—$1,500. I need to amend my 2011 taxes Line 10, total estimated tax credits—$2,460. I need to amend my 2011 taxes Line 11. I need to amend my 2011 taxes Their combined total income from all sources, $68,000, falls between $42,001 and $98,000 on the table for married filing jointly or qualifying widow(er). I need to amend my 2011 taxes The number to the right of this range is 6. I need to amend my 2011 taxes 7. I need to amend my 2011 taxes Line 12, multiply line 10 by line 11—$16,482. I need to amend my 2011 taxes Then the Davis' complete the Form W-4 worksheets. I need to amend my 2011 taxes Because they choose to account for their child and dependent care credit on the Deductions and Adjustments Worksheet, they enter -0- on line F of the Personal Allowances Worksheet and figure a new total for line H. I need to amend my 2011 taxes They take the result on line 12 of Worksheet 1-8, add it to their other adjustments on line 5 of the Form W-4 Deductions and Adjustments Worksheet, and complete the Form W-4 worksheets. I need to amend my 2011 taxes When Will Your New Form W-4 Go Into Effect? If the change is for the current year, your employer must put your new Form W-4 into effect no later than the start of the first payroll period ending on or after the 30th day after the day on which you give your employer your revised Form W-4. I need to amend my 2011 taxes If the change is for next year, your new Form W-4 will not take effect until next year. I need to amend my 2011 taxes Retirees Returning to the Workforce When you first began receiving your pension, you told the payer how much tax to withhold, if any, by completing Form W-4P, Withholding Certificate for Pension or Annuity Payments (or similar form). I need to amend my 2011 taxes However, if your retirement pay is from the military or certain deferred compensation plans, you completed Form W-4 instead of Form W-4P. I need to amend my 2011 taxes You completed either form based on your projected income at that time. I need to amend my 2011 taxes Now that you are returning to the workforce, your new Form W-4 (given to your employer) and your Form W-4 or W-4P (on file with your pension plan) must work together to determine the correct amount of withholding for your new amount of income. I need to amend my 2011 taxes The worksheets that come with Forms W-4 and W-4P are basically the same, so you can use either set of worksheets to figure out how many withholding allowances you are entitled to claim. I need to amend my 2011 taxes Start off with the Personal Allowances Worksheet. I need to amend my 2011 taxes Then, if you will be itemizing your deductions, claiming adjustments to income, or claiming tax credits when you file your tax return, complete the Deductions and Adjustments Worksheet. I need to amend my 2011 taxes The third worksheet is the most important for this situation. I need to amend my 2011 taxes Form W-4 calls it the Two-Earners/Multiple Jobs Worksheet, Form W-4P calls it the Multiple Pensions/More-Than-One-Income Worksheet—both are the same. I need to amend my 2011 taxes If you have more than one source of income, in order to have enough withholding to cover the tax on your higher income, you may need to claim fewer withholding allowances or request your employer to withhold an additional amount from each paycheck. I need to amend my 2011 taxes Once you have figured out how many allowances you are entitled to claim, look at the income from both your pension and your new job, and how often you receive payments. I need to amend my 2011 taxes It is your decision how to divide up your withholding allowances between these sources of income. I need to amend my 2011 taxes For example, you may want to “take home” most of your weekly paycheck to use as spending money and use your monthly pension to “pay the bills. I need to amend my 2011 taxes ” In that case, change your Form W-4P to zero allowances and claim all that you are entitled to on your Form W-4. I need to amend my 2011 taxes There are a couple of ways you can get a better idea of how much tax will be withheld when claiming a certain number of allowances. I need to amend my 2011 taxes Use the withholding tables in Publication 15 (Circular E), Employer's Tax Guide. I need to amend my 2011 taxes Contact your pension provider and your employer's payroll department. I need to amend my 2011 taxes And remember, this is not a final decision. I need to amend my 2011 taxes If you do not get the correct amount of withholding with the first Forms W-4 and W-4P you submit, you should refigure your allowances (or divide them differently) using the information and worksheets in this publication, or the resources mentioned above. I need to amend my 2011 taxes You should go through this same process each time your life situation changes, whether it be for personal or financial reasons. I need to amend my 2011 taxes You may need more tax withheld, or you may need less. I need to amend my 2011 taxes Table 1-2. I need to amend my 2011 taxes Tax Credits for 2014 For more information about the . I need to amend my 2011 taxes . I need to amend my 2011 taxes . I need to amend my 2011 taxes See . I need to amend my 2011 taxes . I need to amend my 2011 taxes . I need to amend my 2011 taxes Adoption credit Form 8839 instructions Child and dependent care expenses, credit for Publication 503, Child and Dependent Care Expenses Child tax credit (including the additional child tax credit) Instructions for Form 1040 or Form 1040A Earned income credit Publication 596, Earned Income Credit Education credits Publication 970, Tax Benefits for Education Elderly or the disabled, credit for the Publication 524, Credit for the Elderly or the Disabled Foreign tax credit (except any credit that applies to wages not subject to U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes income tax withholding because they are subject to income tax withholding by a foreign country) Publication 514, Foreign Tax Credit for Individuals General business credit Form 3800, General Business Credit Mortgage interest credit Publication 530, Tax Information for First-Time Homeowners Qualified electric vehicle passive activity credit Form 8834 Prior year minimum tax, credit for (if you paid alternative minimum tax in an earlier year) Form 8801 instructions Retirement savings contributions credit (saver's credit) Publication 590, Individual Retirement Arrangements (IRAs) Tax credit bonds, credit to holders of Form 8912 instructions Completing Form W-4 and Worksheets When reading the following discussion, you may find it helpful to refer to Form W-4. I need to amend my 2011 taxes Marital Status There is a lower withholding rate for people who qualify to check the “Married” box on line 3 of Form W-4. I need to amend my 2011 taxes Everyone else must have tax withheld at the higher single rate. I need to amend my 2011 taxes Single. I need to amend my 2011 taxes   You must check the “Single” box if any of the following applies. I need to amend my 2011 taxes You are single. I need to amend my 2011 taxes If you are divorced, or separated from your spouse under a court decree of separate maintenance, you are considered single. I need to amend my 2011 taxes You are married, but neither you nor your spouse is a citizen or resident of the United States. I need to amend my 2011 taxes You are married, either you or your spouse is a nonresident alien, and you have not chosen to have that person treated as a resident alien for tax purposes. I need to amend my 2011 taxes For more information, see Nonresident Spouse Treated as a Resident in chapter 1 of Publication 519. I need to amend my 2011 taxes Married. I need to amend my 2011 taxes   You qualify to check the “Married” box if any of the following applies. I need to amend my 2011 taxes You are married and neither you nor your spouse is a nonresident alien. I need to amend my 2011 taxes You are considered married for the whole year even if your spouse died during the year. I need to amend my 2011 taxes You are married and either you or your spouse is a nonresident alien who has chosen to be treated as a resident alien for tax purposes. I need to amend my 2011 taxes For more information, see Nonresident Spouse Treated as a Resident in chapter 1 of Publication 519. I need to amend my 2011 taxes You expect to be able to file your return as a qualifying widow or widower. I need to amend my 2011 taxes You usually can use this filing status if your spouse died within the previous 2 years and you provide more than half the cost of keeping up a home for the entire year that was the main home for you and your child whom you can claim as a dependent. I need to amend my 2011 taxes However, you must file a new Form W-4 showing your filing status as single by December 1 of the last year you are eligible to file as a qualifying widow or widower. I need to amend my 2011 taxes For more information on this filing status, see Qualifying Widow(er) With Dependent Child under Filing Status in Publication 501, Exemptions, Standard Deduction, and Filing Information. I need to amend my 2011 taxes Married, but withhold at higher single rate. I need to amend my 2011 taxes   Some married people find that they do not have enough tax withheld at the married rate. I need to amend my 2011 taxes This can happen, for example, when both spouses work. I need to amend my 2011 taxes To avoid this, you can check the “Married, but withhold at higher Single rate” box (even if you qualify for the married rate). I need to amend my 2011 taxes Also, you may find that more tax is withheld if you fill out the Two-Earners/Multiple Jobs Worksheet, explained later. I need to amend my 2011 taxes Withholding Allowances The more allowances you claim on Form W-4, the less income tax your employer will withhold. I need to amend my 2011 taxes You will have the most tax withheld if you claim “0” allowances. I need to amend my 2011 taxes The number of allowances you can claim depends on the following factors. I need to amend my 2011 taxes How many exemptions you can take on your tax return. I need to amend my 2011 taxes Whether you have income from more than one job. I need to amend my 2011 taxes What deductions, adjustments to income, and credits you expect to have for the year. I need to amend my 2011 taxes Whether you will file as head of household. I need to amend my 2011 taxes If you are married (filing jointly), it also depends on whether your spouse also works and claims any allowances on his or her own Form W-4. I need to amend my 2011 taxes Or, if married filing separately, whether or not your spouse also works. I need to amend my 2011 taxes Form W-4 worksheets. I need to amend my 2011 taxes    Form W-4 has worksheets to help you figure how many withholding allowances you can claim. I need to amend my 2011 taxes The worksheets are for your own records. I need to amend my 2011 taxes Do not give them to your employer. I need to amend my 2011 taxes   Complete only one set of Form W-4 worksheets, no matter how many jobs you have. I need to amend my 2011 taxes If you are married and will file a joint return, complete only one set of worksheets for you and your spouse, even if you both earn wages and each must give Form W-4 to your employers. I need to amend my 2011 taxes Complete separate sets of worksheets only if you and your spouse will file separate returns. I need to amend my 2011 taxes   If you are not exempt from withholding (see Exemption From Withholding , later), complete the Personal Allowances Worksheet on page 1 of the form. I need to amend my 2011 taxes Also, use the worksheets on page 2 of the form to adjust the number of your withholding allowances for itemized deductions and adjustments to income, and for two-earner or multiple-job situations. I need to amend my 2011 taxes If you want to adjust the number of your withholding allowances for certain tax credits, use the Deductions and Adjustments Worksheet on page 2 of Form W-4, even if you do not have any deductions or adjustments. I need to amend my 2011 taxes   Complete all worksheets that apply to your situation. I need to amend my 2011 taxes The worksheets will help you figure the maximum number of withholding allowances you are entitled to claim so that the amount of income tax withheld from your wages will match, as closely as possible, the amount of income tax you will owe at the end of the year. I need to amend my 2011 taxes Multiple jobs. I need to amend my 2011 taxes   If you have income from more than one job at the same time, complete only one set of Form W-4 worksheets. I need to amend my 2011 taxes Then split your allowances between the Forms W-4 for each job. I need to amend my 2011 taxes You cannot claim the same allowances with more than one employer at the same time. I need to amend my 2011 taxes You can claim all your allowances with one employer and none with the other(s), or divide them any other way. I need to amend my 2011 taxes Married individuals. I need to amend my 2011 taxes   If both you and your spouse are employed and expect to file a joint return, figure your withholding allowances using your combined income, adjustments, deductions, exemptions, and credits. I need to amend my 2011 taxes Use only one set of worksheets. I need to amend my 2011 taxes You can divide your total allowances any way, but you cannot claim an allowance that your spouse also claims. I need to amend my 2011 taxes   If you and your spouse expect to file separate returns, figure your allowances using separate worksheets based on your own individual income, adjustments, deductions, exemptions, and credits. I need to amend my 2011 taxes Alternative method of figuring withholding allowances. I need to amend my 2011 taxes   You do not have to use the Form W-4 worksheets if you use a more accurate method of figuring the number of withholding allowances. I need to amend my 2011 taxes   The method you use must be based on withholding schedules, the tax rate schedules, and the 2014 Estimated Tax Worksheet in chapter 2. I need to amend my 2011 taxes It must take into account only the items of income, adjustments to income, deductions, and tax credits that are taken into account on Form W-4. I need to amend my 2011 taxes   You can use the number of withholding allowances determined under an alternative method rather than the number determined using the Form W-4 worksheets. I need to amend my 2011 taxes You still must give your employer a Form W-4 claiming your withholding allowances. I need to amend my 2011 taxes Employees who are not citizens or residents. I need to amend my 2011 taxes   If you are neither a citizen nor a resident of the United States, you usually can claim only one withholding allowance. I need to amend my 2011 taxes However, this rule does not apply if you are a resident of Canada or Mexico, or if you are a U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes national. I need to amend my 2011 taxes It also does not apply if your spouse is a U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes citizen or resident and you have chosen to be treated as a resident of the United States for tax purposes. I need to amend my 2011 taxes Special rules apply to residents of South Korea and India. I need to amend my 2011 taxes For more information, see Withholding From Compensation in chapter 8 of Publication 519. I need to amend my 2011 taxes Personal Allowances Worksheet Use the Personal Allowances Worksheet on page 1 of Form W-4 to figure your withholding allowances based on all of the following that apply. I need to amend my 2011 taxes Exemptions. I need to amend my 2011 taxes Only one job. I need to amend my 2011 taxes Head of household filing status. I need to amend my 2011 taxes Child and dependent care credit. I need to amend my 2011 taxes Child tax credit. I need to amend my 2011 taxes Exemptions (worksheet lines A, C, and D). I need to amend my 2011 taxes   You can claim one withholding allowance for each exemption you expect to claim on your tax return. I need to amend my 2011 taxes Self. I need to amend my 2011 taxes   You can claim an allowance for your exemption on line A unless another person can claim an exemption for you on his or her tax return. I need to amend my 2011 taxes If another person is entitled to claim an exemption for you, you cannot claim an allowance for your exemption even if the other person will not claim your exemption. I need to amend my 2011 taxes Spouse. I need to amend my 2011 taxes   You can claim an allowance for your spouse's exemption on line C unless your spouse is claiming his or her own exemption or another person can claim an exemption for your spouse. I need to amend my 2011 taxes Do not claim this allowance if you and your spouse expect to file separate returns. I need to amend my 2011 taxes Dependents. I need to amend my 2011 taxes   You can claim one allowance on line D for each exemption you will claim for a dependent on your tax return. I need to amend my 2011 taxes Only one job (worksheet line B). I need to amend my 2011 taxes    You can claim an additional withholding allowance if any of the following apply for 2014. I need to amend my 2011 taxes You are single and you have only one job at a time. I need to amend my 2011 taxes You are married, you have only one job at a time, and your spouse does not work. I need to amend my 2011 taxes Your wages from a second job or your spouse's wages (or the total of both) are $1,500 or less. I need to amend my 2011 taxes If you qualify for this allowance, enter “1” on line B of the worksheet. I need to amend my 2011 taxes Head of household filing status (worksheet line E). I need to amend my 2011 taxes   Generally, you can file as head of household if you are unmarried and pay more than half the cost of keeping up a home that: Was the main home for all of 2014 of your parent whom you can claim as a dependent, or You lived in for more than half the year with your qualifying child or any other person you can claim as a dependent. I need to amend my 2011 taxes For more information, see Publication 501. I need to amend my 2011 taxes   If you expect to file as head of household on your 2014 tax return, enter “1” on line E of the worksheet. I need to amend my 2011 taxes Reduction of personal allowances. I need to amend my 2011 taxes   For 2014, your deduction for personal exemptions on your tax return is reduced if your adjusted gross income (AGI) is more than the AGI shown next for your filing status. I need to amend my 2011 taxes Personal Allowance Phaseout Threshold Single $254,200 Married filing jointly or qualifying widow(er) $305,050 Married filing separately $152,525 Head of household $279,650   If you expect your AGI to be more than the amount listed, use Worksheet 1-1 to figure your reduced number of personal allowances on lines A, C, and D of the Personal Allowances Worksheet. I need to amend my 2011 taxes Worksheet 1-1. I need to amend my 2011 taxes Personal Allowances Worksheet (Form W-4) Reduction of Personal Allowances if AGI Above Phaseout Threshold 1. I need to amend my 2011 taxes Enter the total amount of allowances on lines A, C, and D of the Personal Allowance Worksheet without regard to the phaseout rule 1. I need to amend my 2011 taxes   2. I need to amend my 2011 taxes Enter your expected AGI 2. I need to amend my 2011 taxes       3. I need to amend my 2011 taxes Enter $254,200 if single $305,050 if married filing jointly or qualifying widow(er) $152,525 if married filing separately $279,650 if head of household 3. I need to amend my 2011 taxes       4. I need to amend my 2011 taxes Subtract line 3 from line 2 4. I need to amend my 2011 taxes       5. I need to amend my 2011 taxes Divide line 4 by $125,000 ($62,500 if married filing separately). I need to amend my 2011 taxes Enter the result as a decimal 5. I need to amend my 2011 taxes   6. I need to amend my 2011 taxes Multiply line 1 by line 5. I need to amend my 2011 taxes If the result is not a whole number, increase it to the next higher whole number 6. I need to amend my 2011 taxes   7. I need to amend my 2011 taxes Subtract line 6 from line 1. I need to amend my 2011 taxes The total of the numbers you enter on A, C, and D of the Personal Allowances Worksheet can not be more than this amount 7. I need to amend my 2011 taxes     Child and dependent care credit (worksheet line F). I need to amend my 2011 taxes   Enter “1” on line F if you expect to claim a credit for at least $2,000 of qualifying child or dependent care expenses on your 2014 return. I need to amend my 2011 taxes Generally, qualifying expenses are those you pay for the care of your dependent who is your qualifying child under age 13 or for your spouse or dependent who is not able to care for himself or herself so that you can work or look for work. I need to amend my 2011 taxes For more information, see Publication 503, Child and Dependent Care Expenses. I need to amend my 2011 taxes   Instead of using line F, you can choose to take the credit into account on line 5 of the Deductions and Adjustments Worksheet, as explained under Tax credits , later. I need to amend my 2011 taxes Child tax credit (worksheet line G). I need to amend my 2011 taxes   If your total income will be less than $65,000 ($95,000 if married), enter “2” on line G for each eligible child. I need to amend my 2011 taxes Subtract “1” from that amount if you have three to six eligible children. I need to amend my 2011 taxes Subtract “2” from that amount if you have seven or more eligible children. I need to amend my 2011 taxes   If your total income will be between $65,000 and $84,000 ($95,000 and $119,000 if married), enter “1” on line G for each eligible child. I need to amend my 2011 taxes   An eligible child is any child: Who is your son, daughter, stepchild, foster child, brother, sister, stepbrother, stepsister, half brother, half sister, or a descendant of any of them (for example, your grandchild, niece, or nephew), Who will be under age 17 at the end of 2014, Who is younger than you (or your spouse if filing jointly) or permanently and totally disabled, Who will not provide over half of his or her own support for 2014, Who will not file a joint return, unless the return is filed only as a claim for refund, Who will live with you for more than half of 2014, Who is a U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes citizen, U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes national, or U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes resident alien, and Who will be claimed as a dependent on your return. I need to amend my 2011 taxes If you are a U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes citizen or U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes national and your adopted child lived with you all year as a member of your household, that child meets the citizenship test. I need to amend my 2011 taxes   Also, if any other person can claim the child as an eligible child, see Qualifying child of more than one person in the 2013 instructions for Form 1040 or 1040A, line 6c. I need to amend my 2011 taxes   For more information about the child tax credit, see the instructions for Form 1040 or Form 1040A. I need to amend my 2011 taxes   Instead of using line G, you can choose to take the credit into account on line 5 of the Deductions and Adjustments Worksheet, as explained under Tax credits , later. I need to amend my 2011 taxes Total personal allowances (worksheet line H). I need to amend my 2011 taxes    Add lines A through G and enter the total on line H. I need to amend my 2011 taxes If you do not use either of the worksheets on the back of Form W-4, enter the number from line H on line 5 of Form W-4. I need to amend my 2011 taxes Deductions and Adjustments Worksheet Use the Deductions and Adjustments Worksheet on page 2 of Form W-4 if you plan to itemize your deductions, claim certain credits, or claim adjustments to the income on your 2014 tax return and you want to reduce your withholding. I need to amend my 2011 taxes Also, complete this worksheet when you have changes to those items to see if you need to change your withholding. I need to amend my 2011 taxes Use the amount of each item you reasonably can expect to show on your return. I need to amend my 2011 taxes However, do not use more than: The amount shown for that item on your 2013 return (or your 2012 return if you have not yet filed your 2013 return), plus Any additional amount related to a transaction or occurrence (such as payments already made, the signing of an agreement, or the sale of property) that you can prove has happened or will happen during 2013 or 2014. I need to amend my 2011 taxes Do not include any amount shown on your last tax return that has been disallowed by the IRS. I need to amend my 2011 taxes Example. I need to amend my 2011 taxes On June 30, 2013, you bought your first home. I need to amend my 2011 taxes On your 2013 tax return, you claimed itemized deductions of $6,600, the total mortgage interest and real estate tax you paid during the 6 months you owned your home. I need to amend my 2011 taxes Based on your mortgage payment schedule and your real estate tax assessment, you reasonably can expect to claim deductions of $13,200 for those items on your 2014 return. I need to amend my 2011 taxes You can use $13,200 to figure the number of your withholding allowances for itemized deductions. I need to amend my 2011 taxes Not itemizing deductions. I need to amend my 2011 taxes   If you expect to claim the standard deduction on your tax return, skip lines 1 and 2, and enter “0” on line 3 of the worksheet. I need to amend my 2011 taxes Itemized deductions (worksheet line 1). I need to amend my 2011 taxes   Enter your estimated total itemized deductions on line 1 of the worksheet. I need to amend my 2011 taxes   Listed below are some of the deductions you can take into account when figuring additional withholding allowances for 2014. I need to amend my 2011 taxes You normally claim these deductions on Schedule A of Form 1040. I need to amend my 2011 taxes Medical and dental expenses that are more than 10% (7. I need to amend my 2011 taxes 5% if either you or your spouse was born before January 2, 1950) of your 2014 AGI (defined under AGI , later). I need to amend my 2011 taxes State and local income or property taxes. I need to amend my 2011 taxes Deductible home mortgage interest. I need to amend my 2011 taxes Investment interest up to net investment income. I need to amend my 2011 taxes Charitable contributions. I need to amend my 2011 taxes Casualty and theft losses that are more than $100 and 10% of your AGI. I need to amend my 2011 taxes Fully deductible miscellaneous itemized deductions, including: Impairment-related work expenses of persons with disabilities, Federal estate tax on income in respect of a decedent, Repayment of more than $3,000 of income held under a claim of right that you included in income in an earlier year because at the time you thought you had an unrestricted right to it, Unrecovered investments in an annuity contract under which payments have ceased because of the annuitant's death, Gambling losses up to the amount of gambling winnings reported on your return, and Casualty and theft losses from  income-producing property. I need to amend my 2011 taxes Other miscellaneous itemized deductions that are more than 2% of your AGI, including: Unreimbursed employee business expenses, such as education expenses, work clothes and uniforms, union dues and fees, and the cost of work-related small tools and supplies, Safe deposit box rental, Tax counsel and assistance, and Certain fees paid to an IRA trustee or custodian. I need to amend my 2011 taxes AGI. I need to amend my 2011 taxes   For the purpose of estimating your itemized deductions, your AGI is your estimated total income for 2014 minus any estimated adjustments to income (discussed later) that you include on line 4 of the Deductions and Adjustments Worksheet. I need to amend my 2011 taxes Phaseout of itemized deductions. I need to amend my 2011 taxes   For 2014, your total itemized deductions may be phased out (reduced) if your AGI is more than the following thresholds. I need to amend my 2011 taxes    Itemized Deduction Phaseout Threshold Single $254,200 Married filing jointly or qualifying widow(er) $305,050 Married filing separately $152,525 Head of household $279,650   If you expect your AGI to be more than the amount listed, use Worksheet 1–2 to figure your reduction in itemized deductions. I need to amend my 2011 taxes Worksheet 1-2. I need to amend my 2011 taxes Deductions and Adjustments Worksheet (Form W-4)—Line 1 Phaseout of Itemized Deductions 1. I need to amend my 2011 taxes Enter the estimated total of your itemized deductions 1. I need to amend my 2011 taxes   2. I need to amend my 2011 taxes Enter the amount included in line 1 for medical and dental expenses, investment interest, casualty or theft losses, and gambling losses 2. I need to amend my 2011 taxes   3. I need to amend my 2011 taxes Is the amount on line 2 less than the amount on line 1? ❑ No. I need to amend my 2011 taxes Stop here. I need to amend my 2011 taxes Your deduction is not limited. I need to amend my 2011 taxes Enter the amount from line 1 above on line 1 of the Deductions and Adjustments Worksheet. I need to amend my 2011 taxes  ❑ Yes. I need to amend my 2011 taxes Subtract line 2 from line 1. I need to amend my 2011 taxes 3. I need to amend my 2011 taxes       4. I need to amend my 2011 taxes Multiply line 3 by 80% (. I need to amend my 2011 taxes 80) 4. I need to amend my 2011 taxes       5. I need to amend my 2011 taxes Enter your expected AGI 5. I need to amend my 2011 taxes       6. I need to amend my 2011 taxes Enter $305,050 If married filing jointly or qualifying widow(er), $279,650 if head of household, $254,200 if single, or $152,525 if married filing separately 6. I need to amend my 2011 taxes   7. I need to amend my 2011 taxes Is the amount on line 6 less than the amount on line 5? ❑ No. I need to amend my 2011 taxes Stop here. I need to amend my 2011 taxes Your deduction is not limited. I need to amend my 2011 taxes Enter the amount from line 1 above on line 1 of the Deductions and Adjustments Worksheet. I need to amend my 2011 taxes  ❑ Yes. I need to amend my 2011 taxes Subtract line 6 from line 5. I need to amend my 2011 taxes 7. I need to amend my 2011 taxes       8. I need to amend my 2011 taxes Multiply line 7 by 3% (. I need to amend my 2011 taxes 03) 8. I need to amend my 2011 taxes       9. I need to amend my 2011 taxes Enter the smaller of line 4 or line 8 9. I need to amend my 2011 taxes     10. I need to amend my 2011 taxes Subtract line 9 from line 1. I need to amend my 2011 taxes Enter the result here and on line 1 of the Deductions and Adjustments Worksheet 10. I need to amend my 2011 taxes     Adjustments to income (worksheet line 4). I need to amend my 2011 taxes   Enter your estimated total adjustments to income on line 4 of the Deductions and Adjustments Worksheet. I need to amend my 2011 taxes   You can take the following adjustments to income into account when figuring additional withholding allowances for 2014. I need to amend my 2011 taxes These adjustments appear on page 1 of your Form 1040 or 1040A. I need to amend my 2011 taxes Net losses from Schedules C, D, E, and F of Form 1040 and from Part II of Form 4797, line 18b. I need to amend my 2011 taxes Net operating loss carryovers. I need to amend my 2011 taxes Certain business expenses of reservists, performing artists, and fee-based government officials. I need to amend my 2011 taxes Health savings account or medical savings account deduction. I need to amend my 2011 taxes Certain moving expenses. I need to amend my 2011 taxes Deduction for self-employment tax. I need to amend my 2011 taxes Deduction for contributions to self-employed SEP, and qualified SIMPLE plans. I need to amend my 2011 taxes Self-employed health insurance deduction. I need to amend my 2011 taxes Penalty on early withdrawal of savings. I need to amend my 2011 taxes Alimony paid. I need to amend my 2011 taxes IRA deduction. I need to amend my 2011 taxes Student loan interest deduction. I need to amend my 2011 taxes Jury duty pay given to your employer. I need to amend my 2011 taxes Reforestation amortization and expenses. I need to amend my 2011 taxes Deductible expenses related to income reported on line 21 from the rental of personal property engaged in for profit. I need to amend my 2011 taxes Repayment of certain supplemental unemployment benefits. I need to amend my 2011 taxes Contributions to IRC 501(c)(18)(D) pension plans. I need to amend my 2011 taxes Contributions by certain chaplains to IRC 403(b) plans. I need to amend my 2011 taxes Attorney fees and court costs for certain unlawful discrimination claims. I need to amend my 2011 taxes Attorney fees and court costs for certain whistleblower awards. I need to amend my 2011 taxes Estimated amount of decrease in tax attributable to income averaging using Schedule J (Form 1040). I need to amend my 2011 taxes Tax credits (worksheet line 5). I need to amend my 2011 taxes   Although you can take most tax credits into account when figuring withholding allowances, the Personal Allowances Worksheet uses only the child and dependent care credit (line F) and the child tax credit (line G). I need to amend my 2011 taxes But you can take these credits and others into account by adding an extra amount on line 5 of the Deductions and Adjustments Worksheet. I need to amend my 2011 taxes   If you take the child and dependent care credit into account on line 5, do not use line F. I need to amend my 2011 taxes If you take the child tax credit into account on line 5, do not use line G. I need to amend my 2011 taxes   In addition to the child and dependent care credit and the child tax credit, you can generally take into account the following credits. I need to amend my 2011 taxes See the individual tax form instructions for more details. I need to amend my 2011 taxes Foreign tax credit, except any credit that applies to wages not subject to U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes income tax withholding because they are subject to income tax withholding by a foreign country. I need to amend my 2011 taxes See Publication 514, Foreign Tax Credit for Individuals. I need to amend my 2011 taxes Credit for the elderly or the disabled. I need to amend my 2011 taxes See Publication 524, Credit for the Elderly or the Disabled. I need to amend my 2011 taxes Education credits. I need to amend my 2011 taxes See Publication 970, Tax Benefits for Education. I need to amend my 2011 taxes Retirement savings contributions credit (saver's credit). I need to amend my 2011 taxes See Publication 590. I need to amend my 2011 taxes Mortgage interest credit. I need to amend my 2011 taxes See Publication 530, Tax Information for Homeowners. I need to amend my 2011 taxes Adoption credit. I need to amend my 2011 taxes See the Instructions for Form 8839. I need to amend my 2011 taxes Credit for nonrefundable portion of prior year minimum tax if you paid alternative minimum tax in an earlier year. I need to amend my 2011 taxes See the Instructions for Form 8801. I need to amend my 2011 taxes General business credit. I need to amend my 2011 taxes See the Instructions for Form 3800. I need to amend my 2011 taxes Earned income credit. I need to amend my 2011 taxes See Publication 596. I need to amend my 2011 taxes Figuring line 5 entry. I need to amend my 2011 taxes   To figure the amount to add on line 5 for tax credits, multiply your estimated total credits by the appropriate number from Table 1-3 . I need to amend my 2011 taxes Example. I need to amend my 2011 taxes You are married and expect to file a joint return for 2014. I need to amend my 2011 taxes Your combined estimated wages are $68,000. I need to amend my 2011 taxes Your estimated tax credits include a child and dependent care credit of $960 and a mortgage interest credit of $1,700 (total credits = $2,660). I need to amend my 2011 taxes In Table 1-3, the number corresponding to your combined estimated wages ($42,001 – $98,000) is 6. I need to amend my 2011 taxes 7. I need to amend my 2011 taxes Multiply your total estimated tax credits of $2,660 by 6. I need to amend my 2011 taxes 7. I need to amend my 2011 taxes Add the result, $17,822, to the amount you otherwise would show on line 5 of the Deductions and Adjustments Worksheet and enter the total on line 5. I need to amend my 2011 taxes Because you choose to account for your child and dependent care credit this way, do not make an entry on line F of the Personal Allowances Worksheet. I need to amend my 2011 taxes Nonwage income (worksheet line 6). I need to amend my 2011 taxes   Enter on line 6 your estimated total nonwage income (other than tax-exempt income). I need to amend my 2011 taxes Nonwage income includes interest, dividends, net rental income, unemployment compensation, alimony, gambling winnings, prizes and awards, hobby income, capital gains, royalties, and partnership income. I need to amend my 2011 taxes   If line 6 is more than line 5, you may not have enough income tax withheld from your wages. I need to amend my 2011 taxes See Getting the Right Amount of Tax Withheld , later. I need to amend my 2011 taxes Net deductions and adjustments (worksheet line 8). I need to amend my 2011 taxes    If line 7 is less than $3,950, enter “0” on line 8. I need to amend my 2011 taxes If line 7 is $3,950 or more, divide it by $3,950, drop any fraction, and enter the result on line 8. I need to amend my 2011 taxes Example. I need to amend my 2011 taxes If line 7 is $5,200, $5,200 ÷ $3,950 = 1. I need to amend my 2011 taxes 32. I need to amend my 2011 taxes Drop the fraction (. I need to amend my 2011 taxes 32) and enter “1” on line 8. I need to amend my 2011 taxes Two-Earners/Multiple Jobs Worksheet Complete the Two-Earners/Multiple Jobs Worksheet on page 2 of Form W-4 if you have more than one job or are married and you and your spouse both work and the combined earnings from all jobs are more than $50,000 ($20,000 if married). I need to amend my 2011 taxes Reducing your allowances (worksheet lines 1-3). I need to amend my 2011 taxes   On line 1 of the worksheet, enter the number from line H of the Personal Allowances Worksheet (or line 10 of the Deductions and Adjustments Worksheet, if used). I need to amend my 2011 taxes Using Table 1 in the Two-Earners/Multiple Jobs Worksheet, find the number listed beside the amount of your estimated wages for the year from your lowest paying job (or if lower and you are filing jointly, your spouse's job). I need to amend my 2011 taxes Enter that number on line 2. I need to amend my 2011 taxes However, if you are married filing jointly and estimated wages from the highest paying job are $65,000 or less, do not enter more than “3. I need to amend my 2011 taxes ”    Table 1-3. I need to amend my 2011 taxes Deductions and Adjustments Worksheet (Form W-4)—Line 5 a. I need to amend my 2011 taxes  Married Filing Jointly or Qualifying Widow(er) If combined income from all sources is:   Multiply credits by: $0 – 42,000 10. I need to amend my 2011 taxes 0 $42,001 – 98,000 6. I need to amend my 2011 taxes 7 $98,001 – 180,000 4. I need to amend my 2011 taxes 0 $180,001 – 270,000 3. I need to amend my 2011 taxes 6 $270,001 – 440,000 3. I need to amend my 2011 taxes 0 $440,001 – 490,000. I need to amend my 2011 taxes . I need to amend my 2011 taxes . I need to amend my 2011 taxes . I need to amend my 2011 taxes 2. I need to amend my 2011 taxes 9 $490,001 and over 2. I need to amend my 2011 taxes 5 b. I need to amend my 2011 taxes  Single If combined income from all sources is:   Multiply credits by: $0 – 19,000 10. I need to amend my 2011 taxes 0 $19,001 – 47,000 6. I need to amend my 2011 taxes 7 $47,001 – 104,000 4. I need to amend my 2011 taxes 0 $104,001 – 205,000 3. I need to amend my 2011 taxes 6 $205,001 – 430,000 3. I need to amend my 2011 taxes 0 $430,001 and over 2. I need to amend my 2011 taxes 5 c. I need to amend my 2011 taxes  Head of Household If combined income from all sources is:   Multiply credits by: $0 – 30,000 10. I need to amend my 2011 taxes 0 $30,001 – 66,000 6. I need to amend my 2011 taxes 7 $66,001 – 150,000 4. I need to amend my 2011 taxes 0 $150,001 – 235,000 3. I need to amend my 2011 taxes 6 $235,001 – 430,000 3. I need to amend my 2011 taxes 0 $430,001 – 460,000 2. I need to amend my 2011 taxes 9 $460,001 and over 2. I need to amend my 2011 taxes 5 d. I need to amend my 2011 taxes  Married Filing Separately   If combined income from all sources is:   Multiply credits by: $0 – 21,000 10. I need to amend my 2011 taxes 0 $21,001 – 49,000 6. I need to amend my 2011 taxes 7 $49,001 – 90,000 4. I need to amend my 2011 taxes 0 $90,001 – 135,000 3. I need to amend my 2011 taxes 6 $135,001 – 220,000 3. I need to amend my 2011 taxes 0 $220,001 – 245,000 2. I need to amend my 2011 taxes 9 $245,001 and over 2. I need to amend my 2011 taxes 5   Subtract line 2 from line 1 and enter the result (but not less than zero) on line 3 and on Form W-4, line 5. I need to amend my 2011 taxes If line 1 is more than or equal to line 2, do not use the rest of the worksheet. I need to amend my 2011 taxes   If line 1 is less than line 2, enter “0” on Form W-4, line 5. I need to amend my 2011 taxes Then complete lines 4 through 9 of the worksheet to figure the additional withholding needed to avoid underwithholding. I need to amend my 2011 taxes Other amounts owed. I need to amend my 2011 taxes   If you expect to owe amounts other than income tax, such as self-employment tax, include them on line 8. I need to amend my 2011 taxes The total is the additional withholding needed for the year. I need to amend my 2011 taxes Getting the Right Amount of Tax Withheld In most situations, the tax withheld from your pay will be close to the tax you figure on your return if you follow these two rules. I need to amend my 2011 taxes You accurately complete all the Form W-4 worksheets that apply to you. I need to amend my 2011 taxes You give your employer a new Form W-4 when changes occur. I need to amend my 2011 taxes But because the worksheets and withholding methods do not account for all possible situations, you may not be getting the right amount withheld. I need to amend my 2011 taxes This is most likely to happen in the following situations. I need to amend my 2011 taxes You are married and both you and your spouse work. I need to amend my 2011 taxes You have more than one job at a time. I need to amend my 2011 taxes You have nonwage income, such as interest, dividends, alimony, unemployment compensation, or self-employment income. I need to amend my 2011 taxes You will owe additional amounts with your return, such as self-employment tax. I need to amend my 2011 taxes Your withholding is based on obsolete Form W-4 information for a substantial part of the year. I need to amend my 2011 taxes Your earnings are more than $130,000 if you are single or $180,000 if you are married. I need to amend my 2011 taxes You work only part of the year. I need to amend my 2011 taxes You change the number of your withholding allowances during the year. I need to amend my 2011 taxes You are subject to Additional Medicare Tax or Net Investment Income Tax. I need to amend my 2011 taxes If you anticipate liability for Additional Medicare Tax or Net Investment Income Tax, you may request that your employer withhold an additional amount of income tax withholding on Form W-4. I need to amend my 2011 taxes Part-Year Method If you work only part of the year and your employer agrees to use the part-year withholding method, less tax will be withheld from each wage payment than would be withheld if you worked all year. I need to amend my 2011 taxes To be eligible for the part-year method, you must meet both of the following requirements. I need to amend my 2011 taxes You must use the calendar year (the 12 months from January 1 through December 31) as your tax year. I need to amend my 2011 taxes You cannot use a fiscal year. I need to amend my 2011 taxes You must not expect to be employed for more than 245 days during the year. I need to amend my 2011 taxes To figure this limit, count all calendar days that you are employed (including weekends, vacations, and sick days) beginning with the first day you are on the job for pay and ending with your last day of work. I need to amend my 2011 taxes If you are temporarily laid off for 30 days or less, count those days too. I need to amend my 2011 taxes If you are laid off for more than 30 days, do not count those days. I need to amend my 2011 taxes You will not meet this requirement if you begin working before May 1 and expect to work for the rest of the year. I need to amend my 2011 taxes How to apply for the part-year method. I need to amend my 2011 taxes   You must ask your employer in writing to use this method. I need to amend my 2011 taxes The request must state all three of the following. I need to amend my 2011 taxes The date of your last day of work for any prior employer during the current calendar year. I need to amend my 2011 taxes That you do not expect to be employed more than 245 days during the current calendar year. I need to amend my 2011 taxes That you use the calendar year as your tax year. I need to amend my 2011 taxes Cumulative Wage Method If you change the number of your withholding allowances during the year, too much or too little tax may have been withheld for the period before you made the change. I need to amend my 2011 taxes You may be able to compensate for this if your employer agrees to use the cumulative wage withholding method for the rest of the year. I need to amend my 2011 taxes You must ask your employer in writing to use this method. I need to amend my 2011 taxes To be eligible, you must have been paid for the same kind of payroll period (weekly, biweekly, etc. I need to amend my 2011 taxes ) since the beginning of the year. I need to amend my 2011 taxes Aids for Figuring Your Withholding IRS Withholding Calculator. I need to amend my 2011 taxes   If you had too much or too little income tax withheld from your pay, the IRS provides a withholding calculator on its website. I need to amend my 2011 taxes Go to www. I need to amend my 2011 taxes irs. I need to amend my 2011 taxes gov/Individuals/IRS-Withholding-Calculator. I need to amend my 2011 taxes It can help you determine the correct amount to be withheld any time during the year. I need to amend my 2011 taxes Rules Your Employer Must Follow It may be helpful for you to know some of the withholding rules your employer must follow. I need to amend my 2011 taxes These rules can affect how to fill out your Form W-4 and how to handle problems that may arise. I need to amend my 2011 taxes New Form W-4. I need to amend my 2011 taxes   When you start a new job, your employer should give you a Form W-4 to fill out. I need to amend my 2011 taxes Beginning with your first payday, your employer will use the information you give on the form to figure your withholding. I need to amend my 2011 taxes   If you later fill out a new Form W-4, your employer can put it into effect as soon as possible. I need to amend my 2011 taxes The deadline for putting it into effect is the start of the first payroll period ending 30 or more days after you turn it in. I need to amend my 2011 taxes No Form W-4. I need to amend my 2011 taxes   If you do not give your employer a completed Form W-4, your employer must withhold at the highest rate, as if you were single and claimed no withholding allowances. I need to amend my 2011 taxes Repaying withheld tax. I need to amend my 2011 taxes   If you find you are having too much tax withheld because you did not claim all the withholding allowances you are entitled to, you should give your employer a new Form W-4. I need to amend my 2011 taxes Your employer cannot repay any of the tax previously withheld. I need to amend my 2011 taxes Instead, claim the full amount withheld when you file your tax return. I need to amend my 2011 taxes   However, if your employer has withheld more than the correct amount of tax for the Form W-4 you have in effect, you do not have to fill out a new Form W-4 to have your withholding lowered to the correct amount. I need to amend my 2011 taxes Your employer can repay the amount that was withheld incorrectly. I need to amend my 2011 taxes If you are not repaid, your Form W-2 will reflect the full amount actually withheld, which you would claim when you file your tax return. I need to amend my 2011 taxes IRS review of your withholding. I need to amend my 2011 taxes   Whether you are entitled to claim a certain number of allowances or a complete exemption from withholding is subject to review by the IRS. I need to amend my 2011 taxes Your employer may be required to send a copy of the Form W-4 to the IRS. I need to amend my 2011 taxes There is a penalty for supplying false information on Form W-4. I need to amend my 2011 taxes See Penalties , later. I need to amend my 2011 taxes   If the IRS determines that you cannot claim more than a specified number of withholding allowances or claim a complete exemption from withholding, the IRS will issue a notice of the maximum number of withholding allowances permitted (commonly referred to as a “lock-in letter”) to both you and your employer. I need to amend my 2011 taxes   The IRS will provide a period of time during which you can dispute the determination before your employer adjusts your withholding. I need to amend my 2011 taxes If you believe that you are entitled to claim complete exemption from withholding or claim more withholding allowances than the maximum number specified by the IRS in the lock-in letter, you must submit a new Form W-4 and a written statement to support your claims to the IRS. I need to amend my 2011 taxes Contact information (a toll-free number and an IRS office address) will be provided in the lock-in letter. I need to amend my 2011 taxes At the end of this period, if you have not responded or if your response is not adequate, your employer will be required to withhold based on the original lock-in letter. I need to amend my 2011 taxes   After the lock-in letter takes effect, your employer must withhold tax on the basis of the withholding rate (marital status) and maximum number of withholding allowances specified in that letter. I need to amend my 2011 taxes   If you later believe that you are entitled to claim exemption from withholding or more allowances than the IRS determined, you can complete a new Form W-4 and a written statement to support the claims made on the Form W-4 and send them directly to the IRS address shown on the lock-in letter. I need to amend my 2011 taxes Your employer must continue to figure your withholding on the basis of the number of allowances previously determined by the IRS until the IRS advises your employer otherwise. I need to amend my 2011 taxes   At any time, either before or after the lock-in letter becomes effective, you may give your employer a new Form W-4 that does not claim complete exemption from withholding and results in more income tax withheld than specified in the lock-in letter. I need to amend my 2011 taxes Your employer must then withhold tax based on this new Form W-4. I need to amend my 2011 taxes   Additional information is available at IRS. I need to amend my 2011 taxes gov. I need to amend my 2011 taxes Enter “withholding compliance questions” in the search box. I need to amend my 2011 taxes Exemption From Withholding If you claim exemption from withholding, your employer will not withhold federal income tax from your wages. I need to amend my 2011 taxes The exemption applies only to income tax, not to social security or Medicare tax. I need to amend my 2011 taxes You can claim exemption from withholding for 2014 only if both of the following situations apply. I need to amend my 2011 taxes For 2013 you had a right to a refund of all federal income tax withheld because you had no tax liability. I need to amend my 2011 taxes For 2014 you expect a refund of all federal income tax withheld because you expect to have no tax liability. I need to amend my 2011 taxes Use Figure 1-A to help you decide whether you can claim exemption from withholding. I need to amend my 2011 taxes Do not use Figure 1-A if you: Are 65 or older, Are blind, Will itemize deductions on your 2014 return, Will claim an exemption for a dependent on your 2014 return, or Will claim any tax credits on your 2014 return. I need to amend my 2011 taxes These situations are discussed later. I need to amend my 2011 taxes Students. I need to amend my 2011 taxes   If you are a student, you are not automatically exempt. I need to amend my 2011 taxes If you work only part time or during the summer, you may qualify for exemption from withholding. I need to amend my 2011 taxes Example 1. I need to amend my 2011 taxes You are a high school student and expect to earn $2,500 from a summer job. I need to amend my 2011 taxes You do not expect to have any other income during the year, and your parents will be able to claim an exemption for you on their tax return. I need to amend my 2011 taxes You worked last summer and had $375 federal income tax withheld from your pay. I need to amend my 2011 taxes The entire $375 was refunded when you filed your 2013 return. I need to amend my 2011 taxes Using Figure 1-A, you find that you can claim exemption from withholding. I need to amend my 2011 taxes Please click here for the text description of the image. I need to amend my 2011 taxes Figure 1-A: Exemption From Withholding on Form W-4 Example 2. I need to amend my 2011 taxes The facts are the same as in Example 1, except that you also have a savings account and expect to have $400 interest income during the year. I need to amend my 2011 taxes Using Figure 1-A, you find that you cannot claim exemption from withholding because your unearned income will be more than $350 and your total income will be more than $1,000. I need to amend my 2011 taxes    You may have to file a tax return, even if you are exempt from withholding. I need to amend my 2011 taxes See Publication 501 to see whether you must file a return. I need to amend my 2011 taxes    Age 65 or older or blind. I need to amend my 2011 taxes If you are 65 or older or blind, use Worksheet 1-3 or Worksheet 1-4, to help you decide whether you can claim exemption from withholding. I need to amend my 2011 taxes Do not use either worksheet if you will itemize deductions, claim exemptions for dependents, or claim tax credits on your 2014 return. I need to amend my 2011 taxes Instead, see Itemizing deductions or claiming exemptions or credits, next. I need to amend my 2011 taxes Itemizing deductions or claiming exemptions or credits. I need to amend my 2011 taxes   If you had no tax liability for 2013, and you will: Itemize deductions, Claim an exemption for a dependent, or Claim a tax credit, use the 2014 Estimated Tax Worksheet (also see chapter 2), to figure your 2014 expected tax liability. I need to amend my 2011 taxes You can claim exemption from withholding only if your total expected tax liability (line 13c of the worksheet) is zero. I need to amend my 2011 taxes Claiming exemption from withholding. I need to amend my 2011 taxes   To claim exemption, you must give your employer a Form W-4. I need to amend my 2011 taxes Do not complete lines 5 and 6. I need to amend my 2011 taxes Enter “Exempt” on line 7. I need to amend my 2011 taxes   If you claim exemption, but later your situation changes so that you will have to pay income tax after all, you must file a new Form W-4 within 10 days after the change. I need to amend my 2011 taxes If you claim exemption in 2014 but you expect to owe income tax for 2015, you must file a new Form W-4 by December 1, 2014. I need to amend my 2011 taxes   Your claim of exempt status may be reviewed by the IRS. I need to amend my 2011 taxes See IRS review of your withholding , earlier. I need to amend my 2011 taxes An exemption is good for only 1 year. I need to amend my 2011 taxes   You must give your employer a new Form W-4 by February 15 each year to continue your exemption. I need to amend my 2011 taxes Supplemental Wages Supplemental wages include bonuses, commissions, overtime pay, vacation allowances, certain sick pay, and expense allowances under certain plans. I need to amend my 2011 taxes The payer can figure withholding on supplemental wages using the same method used for your regular wages. I need to amend my 2011 taxes However, if these payments are identified separately from regular wages, your employer or other payer of supplemental wages can withhold income tax from these wages at a flat rate. I need to amend my 2011 taxes Expense allowances. I need to amend my 2011 taxes   Reimbursements or other expense allowances paid by your employer under a nonaccountable plan are treated as supplemental wages. I need to amend my 2011 taxes A nonaccountable plan is a reimbursement arrangement that does not require you to account for, or prove, your business expenses to your employer or does not require you to return your employer's payments that are more than your proven expenses. I need to amend my 2011 taxes   Reimbursements or other expense allowances paid under an accountable plan that are more than your proven expenses are treated as paid under a nonaccountable plan if you do not return the excess payments within a reasonable period of time. I need to amend my 2011 taxes Accountable plan. I need to amend my 2011 taxes   To be an accountable plan, your employer's reimbursement or allowance arrangement must include all three of the following rules. I need to amend my 2011 taxes Your expenses must have a business connection. I need to amend my 2011 taxes That is, you must have paid or incurred deductible expenses while performing services as an employee of your employer. I need to amend my 2011 taxes You must adequately account to your employer for these expenses within a reasonable period of time. I need to amend my 2011 taxes You must return any excess reimbursement or allowance within a reasonable period of time. I need to amend my 2011 taxes    An excess reimbursement or allowance is any amount you are paid that is more than the business-related expenses that you adequately accounted for to your employer. I need to amend my 2011 taxes   The definition of reasonable period of time depends on the facts and circumstances of your situation. I need to amend my 2011 taxes However, regardless of those facts and circumstances, actions that take place within the times specified in the following list will be treated as taking place within a reasonable period of time. I need to amend my 2011 taxes You receive an advance within 30 days of the time you have an expense. I need to amend my 2011 taxes You adequately account for your expenses within 60 days after they were paid or incurred. I need to amend my 2011 taxes You return any excess reimbursement within 120 days after the expense was paid or incurred. I need to amend my 2011 taxes You are given a periodic statement (at least quarterly) that asks you to either return or adequately account for outstanding advances and you comply within 120 days of the statement. I need to amend my 2011 taxes Nonaccountable plan. I need to amend my 2011 taxes   Any plan that does not meet the definition of an accountable plan is considered a nonaccountable plan. I need to amend my 2011 taxes For more information about accountable and nonaccountable plans, see chapter 6 of Publication 463, Travel, Entertainment, Gift, and Car Expenses. I need to amend my 2011 taxes Penalties You may have to pay a penalty of $500 if both of the following apply. I need to amend my 2011 taxes You make statements or claim withholding allowances on your Form W-4 that reduce the amount of tax withheld. I need to amend my 2011 taxes You have no reasonable basis for those statements or allowances at the time you prepare your Form W-4. I need to amend my 2011 taxes There is also a criminal penalty for willfully supplying false or fraudulent information on your Form W-4 or for willfully failing to supply information that would increase the amount withheld. I need to amend my 2011 taxes The penalty upon conviction can be either a fine of up to $1,000 or imprisonment for up to 1 year, or both. I need to amend my 2011 taxes These penalties will apply if you deliberately and knowingly falsify your Form W-4 in an attempt to reduce or eliminate the proper withholding of taxes. I need to amend my 2011 taxes A simple error or an honest mistake will not result in one of these penalties. I need to amend my 2011 taxes For example, a person who has tried to figure the number of withholding allowances correctly, but claims seven when the proper number is six, will not be charged a Form W-4 penalty. I need to amend my 2011 taxes However, see chapter 4 for information on the penalty for underpaying your tax. I need to amend my 2011 taxes Tips The tips you receive while working on your job are considered part of your pay. I need to amend my 2011 taxes You must include your tips on your tax return on the same line as your regular pay. I need to amend my 2011 taxes However, tax is not withheld directly from tip income, as it is from your regular pay. I need to amend my 2011 taxes Nevertheless, your employer will take into account the tips you report when figuring how much to withhold from your regular pay. I need to amend my 2011 taxes Reporting tips to your employer. I need to amend my 2011 taxes   If you receive tips of $20 or more in a month while working for any one employer, you must report to your employer the total amount of tips you receive on the job during the month. I need to amend my 2011 taxes The report is due by the 10th day of the following month. I need to amend my 2011 taxes   If you have more than one job, make a separate report to each employer. I need to amend my 2011 taxes Report only the tips you received while working for that employer, and only if they total $20 or more for the month. I need to amend my 2011 taxes How employer figures amount to withhold. I need to amend my 2011 taxes   The tips you report to your employer are counted as part of your income for the month you report them. I need to amend my 2011 taxes Your employer can figure your withholding in either of two ways. I need to amend my 2011 taxes By withholding at the regular rate on the sum of your pay plus your reported tips. I need to amend my 2011 taxes By withholding at the regular rate on your pay plus a percentage of your reported tips. I need to amend my 2011 taxes Not enough pay to cover taxes. I need to amend my 2011 taxes   If your regular pay is not enough for your employer to withhold all the tax (including income tax and social security and Medicare taxes (or the equivalent railroad retirement tax)) due on your pay plus your tips, you can give your employer money to cover the shortage. I need to amend my 2011 taxes   If you do not give your employer money to cover the shortage, your employer first withholds as much Medicare tax and social security or railroad retirement tax as possible, up to the proper amount, and then withholds income tax up to the full amount of your pay. I need to amend my 2011 taxes If not enough tax is withheld, you may have to pay estimated tax. I need to amend my 2011 taxes When you file your return, you also may have to pay any Medicare and social security tax or railroad retirement tax your employer could not withhold. I need to amend my 2011 taxes Tips not reported to your employer. I need to amend my 2011 taxes   On your tax return, you must report all the tips you receive during the year, even tips you do not report to your employer (this includes the value of any noncash tips you received, such as tickets, passes, or other items of value). I need to amend my 2011 taxes Make sure you are having enough tax withheld, or are paying enough estimated tax (see chapter 2), to cover all your tip income. I need to amend my 2011 taxes Allocated tips. I need to amend my 2011 taxes   If you work in a large food or beverage establishment, your employer may have to report an allocated amount of tips on your Form W-2. I need to amend my 2011 taxes   Your employer should not withhold income tax, Medicare tax, and social security or railroad retirement tax on the allocated amount. I need to amend my 2011 taxes Withholding is based only on your pay plus your reported tips. I need to amend my 2011 taxes Your employer should refund to you any incorrectly withheld tax. I need to amend my 2011 taxes More information. I need to amend my 2011 taxes   For more information on the reporting and withholding rules for tip income and on tip allocation, see Publi
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Understanding your CP166 Notice

We were unable to process your monthly payment because there were insufficient funds in your bank account.

Printable samples of this notice (PDF)

Tax publications you may find useful

How to get help

Calling the 1-800 number listed on the top right corner of your notice is the fastest way to get your questions answered.

You can also authorize someone (such as an accountant) to contact the IRS on your behalf using this Power of Attorney and Declaration of Representative (Form 2848).

Or you may qualify for help from a Low Income Taxpayer Clinic.
 


What you need to do

  • Make sure there’s enough money in your bank account to cover your monthly payment with us, plus any additional fees or penalty charges from your bank.

Answers to Common Questions

I sent my monthly payment in the mail this month. Why did the IRS attempt to debit my account?
Once you establish a Direct Debit Installment Agreement (DDIA), you have agreed to the IRS debiting the fixed payment on the established date every month. Unless you made other arrangements, your payment plan is by DDIA, so even if you mailed in a payment, we’ll still attempt to withdraw your monthly payment from your account.

I mailed the IRS my updated checking account information, but you tried to take the money out of my old account. How do I make sure you have the right account information?
If you think we haven’t updated your account information timely or accurately, please contact us at the toll free number on your notice to verify that we have the correct information on your Direct Debit Installment Agreement (DDIA). If your bank charged you a fee because we attempted to debit your old account, you will have to contact your bank for them to waive any fees they charged. Their fees are independent of any charges from the IRS.

I’m sure I had enough money in my account. Why did the bank tell you there were insufficient funds?
You’ll have to contact your bank to clarify the situation. In addition, if your installment agreement is now in default and you believe you had sufficient funds in your bank account on the payment due date, please write to the address shown on your notice. Be sure to include a signed statement of explanation along with proof you had sufficient funds. The lower portion of your notice must accompany any correspondence you send us.

How do I change my monthly payment date on my direct debit installment agreement?
Please call the toll-free number on your notice.

The notice I received mentioned that "interest may increase" if there are insufficient funds in my bank account. What’s the current interest, and how much will it increase?
Interest is charged on any unpaid balances on your account, so as long as you owe money, interest is charged and added to your account balance(s). The interest amount you owe on your unpaid balance will increase, but not the interest rate.

The rate of interest is determined on a quarterly basis. For taxpayers other than corporations, the overpayment and underpayment rate is the federal short-term rate plus 3 percentage points.


Tips for next year

Consider filing your taxes electronically. Filing online can help you avoid mistakes and find credits and deductions that you may qualify for. In many cases you can file for free. Learn more about e-file.

Page Last Reviewed or Updated: 26-Mar-2014

The I Need To Amend My 2011 Taxes

I need to amend my 2011 taxes Publication 514 - Main Content Table of Contents Choosing To Take Credit or DeductionChoice Applies to All Qualified Foreign Taxes Making or Changing Your Choice Why Choose the Credit?Credit for Taxes Paid or Accrued Foreign Currency and Exchange Rates Foreign Tax Redetermination Who Can Take the Credit?U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes Citizens Resident Aliens Nonresident Aliens What Foreign Taxes Qualify for the Credit?Tax Must Be Imposed on You You Must Have Paid or Accrued the Tax Tax Must Be the Legal and Actual Foreign Tax Liability Tax Must Be an Income Tax (or Tax in Lieu of Income Tax) Foreign Taxes for Which You Cannot Take a CreditTaxes on Excluded Income Taxes for Which You Can Only Take an Itemized Deduction Taxes on Foreign Mineral Income Taxes From International Boycott Operations Taxes on Combined Foreign Oil and Gas Income Taxes of U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes Persons Controlling Foreign Corporations and Partnerships Taxes Related to a Foreign Tax Credit Splitting Event How To Figure the CreditLimit on the Credit Separate Limit Income Allocation of Foreign Taxes Foreign Taxes From a Partnership or an S Corporation Figuring the Limit Qualified Dividends Capital Gains and Losses Allocation of Foreign and U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes Losses Tax Treaties Carryback and CarryoverTime Limit on Tax Assessment Claim for Refund Taxes All Credited or All Deducted Married Couples How To Claim the CreditForm 1116 Records To Keep Simple Example — Filled-In Form 1116Part I—Taxable Income or Loss From Sources Outside the United States (for Category Checked Above) Part II—Foreign Taxes Paid or Accrued Part III—Figuring the Credit Part IV—Summary of Credits From Separate Parts III Comprehensive Example — Filled-In Form 1116Foreign earned income. I need to amend my 2011 taxes Employee business expenses. I need to amend my 2011 taxes Forms 1116 Computation of Taxable Income Part I—Taxable Income or Loss From Sources Outside the United States (for Category Checked Above) Part II—Foreign Taxes Paid or Accrued Part III—Figuring the Credit Part IV—Summary of Credits From Separate Parts III Unused Foreign Taxes How To Get Tax HelpLow Income Taxpayer Clinics Choosing To Take Credit or Deduction You can choose whether to take the amount of any qualified foreign taxes paid or accrued during the year as a foreign tax credit or as an itemized deduction. I need to amend my 2011 taxes You can change your choice for each year's taxes. I need to amend my 2011 taxes To choose the foreign tax credit, in most cases you must complete Form 1116 and attach it to your U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes tax return. I need to amend my 2011 taxes However, you may qualify for the exception that allows you to claim the foreign tax credit without using Form 1116. I need to amend my 2011 taxes See How To Figure the Credit , later. I need to amend my 2011 taxes To choose to claim the taxes as an itemized deduction, use Schedule A (Form 1040), Itemized Deductions. I need to amend my 2011 taxes Figure your tax both ways—claiming the credit and claiming the deduction. I need to amend my 2011 taxes Then fill out your return the way that benefits you more. I need to amend my 2011 taxes See Why Choose the Credit, later. I need to amend my 2011 taxes Choice Applies to All Qualified Foreign Taxes As a general rule, you must choose to take either a credit or a deduction for all qualified foreign taxes. I need to amend my 2011 taxes If you choose to take a credit for qualified foreign taxes, you must take the credit for all of them. I need to amend my 2011 taxes You cannot deduct any of them. I need to amend my 2011 taxes Conversely, if you choose to deduct qualified foreign taxes, you must deduct all of them. I need to amend my 2011 taxes You cannot take a credit for any of them. I need to amend my 2011 taxes See What Foreign Taxes Qualify for the Credit , later, for the meaning of qualified foreign taxes. I need to amend my 2011 taxes There are exceptions to this general rule, which are described next. I need to amend my 2011 taxes Exceptions for foreign taxes not allowed as a credit. I need to amend my 2011 taxes   Even if you claim a credit for other foreign taxes, you can deduct any foreign tax that is not allowed as a credit if: You paid the tax to a country for which a credit is not allowed because it provides support for acts of international terrorism, or because the United States does not have or does not conduct diplomatic relations with it or recognize its government and that government is not otherwise eligible to purchase defense articles or services under the Arms Export Control Act, You paid withholding tax on dividends from foreign corporations whose stock you did not hold for the required period of time, You paid withholding tax on income or gain (other than dividends) from property you did not hold for the required period of time, You paid withholding tax on income or gain to the extent you had to make related payments on positions in substantially similar or related property, You participated in or cooperated with an international boycott, You paid taxes in connection with the purchase or sale of oil or gas, or You paid or accrued taxes on income or gain in connection with a covered asset acquisition. I need to amend my 2011 taxes Covered asset acquisitions include certain acquisitions that result in a stepped-up basis for U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes tax purposes. I need to amend my 2011 taxes For more information, see Internal Revenue Code section 901(m). I need to amend my 2011 taxes The IRS intends to issue guidance that will explain this provision in greater detail. I need to amend my 2011 taxes   For more information on these items, see Taxes for Which You Can Only Take an Itemized Deduction , later, under Foreign Taxes for Which You Cannot Take a Credit. I need to amend my 2011 taxes Foreign taxes that are not income taxes. I need to amend my 2011 taxes   In most cases, only foreign income taxes qualify for the foreign tax credit. I need to amend my 2011 taxes Other taxes, such as foreign real and personal property taxes, do not qualify. I need to amend my 2011 taxes But you may be able to deduct these other taxes even if you claim the foreign tax credit for foreign income taxes. I need to amend my 2011 taxes   In most cases, you can deduct these other taxes only if they are expenses incurred in a trade or business or in the production of income. I need to amend my 2011 taxes However, you can deduct foreign real property taxes that are not trade or business expenses as an itemized deduction on Schedule A (Form 1040). I need to amend my 2011 taxes Carrybacks and carryovers. I need to amend my 2011 taxes   There is a limit on the credit you can claim in a tax year. I need to amend my 2011 taxes If your qualified foreign taxes exceed the credit limit, you may be able to carry over or carry back the excess to another tax year. I need to amend my 2011 taxes If you deduct qualified foreign taxes in a tax year, you cannot use a carryback or carryover in that year. I need to amend my 2011 taxes That is because you cannot take both a deduction and a credit for qualified foreign taxes in the same tax year. I need to amend my 2011 taxes   For more information on the limit, see How To Figure the Credit , later. I need to amend my 2011 taxes For more information on carrybacks and carryovers, see Carryback and Carryover , later. I need to amend my 2011 taxes Making or Changing Your Choice You can make or change your choice to claim a deduction or credit at any time during the period within 10 years from the regular due date for filing the return (without regard to any extension of time to file) for the tax year in which the taxes were actually paid or accrued. I need to amend my 2011 taxes You make or change your choice on your tax return (or on an amended return) for the year your choice is to be effective. I need to amend my 2011 taxes Example. I need to amend my 2011 taxes You paid foreign taxes for the last 13 years and chose to deduct them on your U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes income tax returns. I need to amend my 2011 taxes You were timely in both filing your returns and paying your U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes tax liability. I need to amend my 2011 taxes In February 2013, you file an amended return for tax year 2002 choosing to take a credit for your 2002 foreign taxes because you now realize that the credit is more advantageous than the deduction for that year. I need to amend my 2011 taxes Because the regular due date of your 2002 return was April 15, 2003, this choice is timely (within 10 years). I need to amend my 2011 taxes Because there is a limit on the credit for your 2002 foreign tax, you have unused 2002 foreign taxes. I need to amend my 2011 taxes Ordinarily, you first carry back unused foreign taxes arising in 2002 to, and claim them as a credit in, the 2 preceding tax years. I need to amend my 2011 taxes If you are unable to claim all of them in those 2 years, you carry them forward to the 10 years following the year in which they arose. I need to amend my 2011 taxes Because you originally chose to deduct your foreign taxes and the 10-year period for changing the choice for 2000 and 2001 has passed, you cannot change your choice and carry the unused 2002 foreign taxes back to tax years 2000 and 2001. I need to amend my 2011 taxes Because the 10-year periods for changing the choice have not passed for your 2003 through 2012 income tax returns, you can still choose to claim the credit for those years and carry forward any unused 2002 foreign taxes. I need to amend my 2011 taxes However, you must reduce the unused 2002 foreign taxes that you carry forward by the amount that would have been allowed as a carryback if you had timely carried back the foreign tax to tax years 2000 and 2001. I need to amend my 2011 taxes You cannot take a credit or a deduction for foreign taxes paid on income you exclude under the foreign earned income exclusion or the foreign housing exclusion. I need to amend my 2011 taxes See Foreign Earned Income and Housing Exclusions under Foreign Taxes for Which You Cannot Take a Credit, later. I need to amend my 2011 taxes Why Choose the Credit? The foreign tax credit is intended to relieve you of a double tax burden when your foreign source income is taxed by both the United States and the foreign country. I need to amend my 2011 taxes In most cases, if the foreign tax rate is higher than the U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes rate, there will be no U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes tax on the foreign income. I need to amend my 2011 taxes If the foreign tax rate is lower than the U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes rate, U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes tax on the foreign income will be limited to the difference between the rates. I need to amend my 2011 taxes The foreign tax credit can only reduce U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes taxes on foreign source income; it cannot reduce U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes taxes on U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes source income. I need to amend my 2011 taxes Although no one rule covers all situations, in most cases it is better to take a credit for qualified foreign taxes than to deduct them as an itemized deduction. I need to amend my 2011 taxes This is because: A credit reduces your actual U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes income tax on a dollar-for-dollar basis, while a deduction reduces only your income subject to tax, You can choose to take the foreign tax credit even if you do not itemize your deductions. I need to amend my 2011 taxes You then are allowed the standard deduction in addition to the credit, and If you choose to take the foreign tax credit, and the taxes paid or accrued exceed the credit limit for the tax year, you may be able to carry over or carry back the excess to another tax year. I need to amend my 2011 taxes (See Limit on credit under How To Figure the Credit, later. I need to amend my 2011 taxes ) Example 1. I need to amend my 2011 taxes For 2013, you and your spouse have adjusted gross income of $80,300, including $20,000 of dividend income from foreign sources. I need to amend my 2011 taxes None of the dividends are qualified dividends. I need to amend my 2011 taxes You file a joint return and can claim two $3,900 exemptions. I need to amend my 2011 taxes You had to pay $2,000 in foreign income taxes on the dividend income. I need to amend my 2011 taxes If you take the foreign taxes as an itemized deduction, your total itemized deductions are $15,000. I need to amend my 2011 taxes Your taxable income then is $57,500 and your tax is $7,736. I need to amend my 2011 taxes If you take the credit instead, your itemized deductions are only $13,000. I need to amend my 2011 taxes Your taxable income then is $59,500 and your tax before the credit is $8,036. I need to amend my 2011 taxes After the credit, however, your tax is only $6,036. I need to amend my 2011 taxes Therefore, your tax is $1,700 lower ($7,736 − $6,036) by taking the credit. I need to amend my 2011 taxes Example 2. I need to amend my 2011 taxes In 2013, you receive investment income of $5,000 from a foreign country, which imposes a tax of $1,500 on that income. I need to amend my 2011 taxes You report on your U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes return this income as well as $56,000 of U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes source wages and an allowable $49,000 partnership loss from a U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes partnership. I need to amend my 2011 taxes Your share of the partnership's gross income is $25,000 and your share of its expenses is $74,000. I need to amend my 2011 taxes You are single, entitled to one $3,900 exemption, and have other itemized deductions of $6,850. I need to amend my 2011 taxes If you deduct the foreign tax on your U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes return, your taxable income is a negative $250 ($5,000 + $56,000 − $49,000 − $1,500 − $6,850 − $3,900) and your tax is $0. I need to amend my 2011 taxes If you take the credit instead, your taxable income is $1,250 ($5,000 + $56,000 − $49,000 − $3,900 − $6,850) and your tax before the credit is $126. I need to amend my 2011 taxes You can take a credit of only $113 because of limits discussed later. I need to amend my 2011 taxes Your tax after the credit is $13 ($126 − $113), which is $13 more than if you deduct the foreign tax. I need to amend my 2011 taxes If you choose the credit, you will have unused foreign taxes of $1,387 ($1,500 − $113). I need to amend my 2011 taxes When deciding whether to take the credit or the deduction this year, you will need to consider whether you can benefit from a carryback or carryover of that unused foreign tax. I need to amend my 2011 taxes Credit for Taxes Paid or Accrued You can claim the credit for a qualified foreign tax in the tax year in which you pay it or accrue it, depending on your method of accounting. I need to amend my 2011 taxes “Tax year” refers to the tax year for which your U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes return is filed, not the tax year for which your foreign return is filed. I need to amend my 2011 taxes Accrual method of accounting. I need to amend my 2011 taxes   If you use an accrual method of accounting, you can claim the credit only in the year in which you accrue the tax. I need to amend my 2011 taxes You are using an accrual method of accounting if you report income when you earn it, rather than when you receive it, and you deduct your expenses when you incur them, rather than when you pay them. I need to amend my 2011 taxes   In most cases, foreign taxes accrue when all the events have taken place that fix the amount of the tax and your liability to pay it. I need to amend my 2011 taxes Generally, this occurs on the last day of the tax year for which your foreign return is filed. I need to amend my 2011 taxes Contesting your foreign tax liability. I need to amend my 2011 taxes   If you are contesting your foreign tax liability, you cannot accrue it and take a credit until the amount of foreign tax due is finally determined. I need to amend my 2011 taxes However, if you choose to pay the tax liability you are contesting, you can take a credit for the amount you pay before a final determination of foreign tax liability is made. I need to amend my 2011 taxes Once your liability is determined, the foreign tax credit is allowable for the year to which the foreign tax relates. I need to amend my 2011 taxes If the amount of foreign taxes taken as a credit differs from the final foreign tax liability, you may have to adjust the credit, as discussed later under Foreign Tax Redetermination . I need to amend my 2011 taxes You may have to post a bond. I need to amend my 2011 taxes   If you claim a credit for taxes accrued but not paid, you may have to post an income tax bond to guarantee your payment of any tax due in the event the amount of foreign tax paid differs from the amount claimed. I need to amend my 2011 taxes   The IRS can request this bond at any time without regard to the Time Limit on Tax Assessment discussed later under Carryback and Carryover. I need to amend my 2011 taxes Cash method of accounting. I need to amend my 2011 taxes   If you use the cash method of accounting, you can choose to take the credit either in the year you pay the tax or in the year you accrue it. I need to amend my 2011 taxes You are using the cash method of accounting if you report income in the year you actually or constructively receive it, and deduct expenses in the year you pay them. I need to amend my 2011 taxes Choosing to take credit in the year taxes accrue. I need to amend my 2011 taxes   Even if you use the cash method of accounting, you can choose to take a credit for foreign taxes in the year they accrue. I need to amend my 2011 taxes You make the choice by checking the box in Part II of Form 1116. I need to amend my 2011 taxes Once you make that choice, you must follow it in all later years and take a credit for foreign taxes in the year they accrue. I need to amend my 2011 taxes   In addition, the choice to take the credit when foreign taxes accrue applies to all foreign taxes qualifying for the credit. I need to amend my 2011 taxes You cannot take a credit for some foreign taxes when paid and take a credit for others when accrued. I need to amend my 2011 taxes   If you make the choice to take the credit when foreign taxes accrue and pay them in a later year, you cannot claim a deduction for any part of the previously accrued taxes. I need to amend my 2011 taxes Credit based on taxes paid in earlier year. I need to amend my 2011 taxes   If, in earlier years, you took the credit based on taxes paid, and this year you choose to take the credit based on taxes accrued, you may be able to take the credit this year for taxes from more than one year. I need to amend my 2011 taxes Example. I need to amend my 2011 taxes Last year you took the credit based on taxes paid. I need to amend my 2011 taxes This year you chose to take the credit based on taxes accrued. I need to amend my 2011 taxes During the year you paid foreign income taxes owed for last year. I need to amend my 2011 taxes You also accrued foreign income taxes for this year that you did not pay by the end of the year. I need to amend my 2011 taxes You can base the credit on your return for this year on both last year's taxes that you paid and this year's taxes that you accrued. I need to amend my 2011 taxes Foreign Currency and Exchange Rates U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes income tax is imposed on income expressed in U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes dollars, while in most cases the foreign tax is imposed on income expressed in foreign currency. I need to amend my 2011 taxes Therefore, fluctuations in the value of the foreign currency relative to the U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes dollar may affect the foreign tax credit. I need to amend my 2011 taxes Translating foreign currency into U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes dollars. I need to amend my 2011 taxes   If you receive all or part of your income or pay some or all of your expenses in foreign currency, you must translate the foreign currency into U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes dollars. I need to amend my 2011 taxes How and when you do this depends on your functional currency. I need to amend my 2011 taxes In most cases, your functional currency is the U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes dollar unless you are required to use the currency of a foreign country. I need to amend my 2011 taxes   You must make all federal income tax determinations in your functional currency. I need to amend my 2011 taxes The U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes dollar is the functional currency for all taxpayers except some qualified business units. I need to amend my 2011 taxes A qualified business unit is a separate and clearly identified unit of a trade or business that maintains separate books and records. I need to amend my 2011 taxes Unless you are self-employed, your functional currency is the U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes dollar. I need to amend my 2011 taxes   Even if you are self-employed and have a qualified business unit, your functional currency is the U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes dollar if any of the following apply. I need to amend my 2011 taxes You conduct the business primarily in dollars. I need to amend my 2011 taxes The principal place of business is located in the United States. I need to amend my 2011 taxes You choose to or are required to use the dollar as your functional currency. I need to amend my 2011 taxes The business books and records are not kept in the currency of the economic environment in which a significant part of the business activities is conducted. I need to amend my 2011 taxes   If your functional currency is the U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes dollar, you must immediately translate into dollars all items of income, expense, etc. I need to amend my 2011 taxes , that you receive, pay, or accrue in a foreign currency and that will affect computation of your income tax. I need to amend my 2011 taxes If there is more than one exchange rate, use the one that most properly reflects your income. I need to amend my 2011 taxes In most cases, you can get exchange rates from banks and U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes Embassies. I need to amend my 2011 taxes   If your functional currency is not the U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes dollar, make all income tax determinations in your functional currency. I need to amend my 2011 taxes At the end of the year, translate the results, such as income or loss, into U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes dollars to report on your income tax return. I need to amend my 2011 taxes    For more information, write to: Internal Revenue Service International Section Philadelphia, PA 19255-0725 Rate of exchange for foreign taxes paid. I need to amend my 2011 taxes   Use the rate of exchange in effect on the date you paid the foreign taxes to the foreign country unless you meet the exception discussed next. I need to amend my 2011 taxes If your tax was withheld in foreign currency, use the rate of exchange in effect for the date on which the tax was withheld. I need to amend my 2011 taxes If you make foreign estimated tax payments, you use the rate of exchange in effect for the date on which you made the estimated tax payment. I need to amend my 2011 taxes   The exchange rate rules discussed here apply even if the foreign taxes are paid or accrued with respect to a foreign tax credit splitting event (discussed later). I need to amend my 2011 taxes Exception. I need to amend my 2011 taxes   If you claim the credit for foreign taxes on an accrual basis, in most cases you must use the average exchange rate for the tax year to which the taxes relate. I need to amend my 2011 taxes This rule applies to accrued taxes relating to tax years beginning after 1997 and only under the following conditions. I need to amend my 2011 taxes The foreign taxes are paid on or after the first day of the tax year to which they relate. I need to amend my 2011 taxes The foreign taxes are paid not later than 2 years after the close of the tax year to which they relate. I need to amend my 2011 taxes The foreign tax liability is not denominated in an inflationary currency (defined in the Form 1116 instructions). I need to amend my 2011 taxes (This condition applies to taxes paid or accrued in tax years beginning after November 6, 2007. I need to amend my 2011 taxes )   For all other foreign taxes, you should use the exchange rate in effect on the date you paid them. I need to amend my 2011 taxes Election to use exchange rate on date paid. I need to amend my 2011 taxes   If you have accrued foreign taxes that you are otherwise required to convert using the average exchange rate, you may elect to use the exchange rate in effect on the date the foreign taxes are paid if the taxes are denominated in a nonfunctional foreign currency. I need to amend my 2011 taxes If any of the accrued taxes are unpaid, you must translate them into U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes dollars using the exchange rate on the last day of the U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes tax year to which those taxes relate. I need to amend my 2011 taxes You may make the election for all nonfunctional currency foreign income taxes or only those nonfunctional currency foreign income taxes that are attributable to qualified business units with a U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes dollar functional currency. I need to amend my 2011 taxes Once made, the election applies to the tax year for which made and all subsequent tax years unless revoked with the consent of the IRS. I need to amend my 2011 taxes The election is available for tax years beginning after 2004. I need to amend my 2011 taxes It must be made by the due date (including extensions) for filing the tax return for the first tax year to which the election applies. I need to amend my 2011 taxes Make the election by attaching a statement to the applicable tax return. I need to amend my 2011 taxes The statement must identify whether the election is made for all foreign taxes or only for foreign taxes attributable to qualified business units with a U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes dollar functional currency. I need to amend my 2011 taxes Foreign Tax Redetermination A foreign tax redetermination is any change in your foreign tax liability that may affect your U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes foreign tax credit claimed. I need to amend my 2011 taxes The year in which to claim the credit remains the year to which the foreign taxes paid or accrued relate, even if the change in foreign tax liability occurs in a later year. I need to amend my 2011 taxes If a foreign tax redetermination occurs, a redetermination of your U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes tax liability is required if any of the following conditions apply. I need to amend my 2011 taxes The accrued taxes when paid differ from the amounts claimed as a credit. I need to amend my 2011 taxes The accrued taxes you claimed as a credit in one tax year are not paid within 2 years after the end of that tax year. I need to amend my 2011 taxes If this applies to you, you must reduce the credit previously claimed by the amount of the unpaid taxes. I need to amend my 2011 taxes You will not be allowed a credit for the unpaid taxes until you pay them. I need to amend my 2011 taxes When you pay the accrued taxes, a new foreign tax redetermination occurs and you must translate the taxes into U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes dollars using the exchange rate as of the date they were paid. I need to amend my 2011 taxes The foreign tax credit is allowed for the year to which the foreign tax relates. I need to amend my 2011 taxes See Rate of exchange for foreign taxes paid , earlier, under Foreign Currency and Exchange Rates. I need to amend my 2011 taxes The foreign taxes you paid are refunded in whole or in part. I need to amend my 2011 taxes For taxes taken into account when accrued but translated into dollars on the date of payment, the dollar value of the accrued tax differs from the dollar value of the tax paid because of fluctuations in the exchange rate between the date of accrual and the date of payment. I need to amend my 2011 taxes However, no redetermination is required if the change in foreign tax liability for each foreign country is solely attributable to exchange rate fluctuations and is less than the smaller of: $10,000, or 2% of the total dollar amount of the foreign tax initially accrued for that foreign country for the U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes tax year. I need to amend my 2011 taxes In this case, you must adjust your U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes tax in the tax year in which the accrued foreign taxes are paid. I need to amend my 2011 taxes Notice to the Internal Revenue Service (IRS) of Redetermination You are required to notify the IRS about a foreign tax credit redetermination that affects your U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes tax liability for each tax year affected by the redetermination. I need to amend my 2011 taxes In most cases, you must file Form 1040X, Amended U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes Individual Income Tax Return, with a revised Form 1116 and a statement that contains information sufficient for the IRS to redetermine your U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes tax liability for the year or years affected. I need to amend my 2011 taxes See Contents of statement , later. I need to amend my 2011 taxes You are not required to attach Form 1116 for a tax year affected by a redetermination if: The amount of your creditable taxes paid or accrued during the tax year is not more than $300 ($600 if married filing a joint return) as a result of the foreign tax redetermination, and You meet the requirements listed under Exemption from foreign tax credit limit under How To Figure the Credit, later. I need to amend my 2011 taxes There are other exceptions to this requirement. I need to amend my 2011 taxes They are discussed later under Due date of notification to IRS . I need to amend my 2011 taxes Contents of statement. I need to amend my 2011 taxes   The statement must include all of the following. I need to amend my 2011 taxes Your name, address, and taxpayer identification number. I need to amend my 2011 taxes The tax year or years that are affected by the foreign tax redetermination. I need to amend my 2011 taxes The date or dates the foreign taxes were accrued, if applicable. I need to amend my 2011 taxes The date or dates the foreign taxes were paid. I need to amend my 2011 taxes The amount of foreign taxes paid or accrued on each date (in foreign currency) and the exchange rate used to translate each amount. I need to amend my 2011 taxes Information sufficient to determine any interest due from or owing to you, including the amount of any interest paid to you by the foreign government and the dates received. I need to amend my 2011 taxes   In the case of any foreign taxes that were not paid before the date two years after the close of the tax year to which those taxes relate, you must provide the amount of those taxes in foreign currency and the exchange rate that was used to translate that amount when originally claimed as a credit. I need to amend my 2011 taxes   If any foreign tax was refunded in whole or in part, you must provide the date and amount (in foreign currency) of each refund, the exchange rate that was used to translate each amount when originally claimed as a credit, and the exchange rate for the date the refund was received (for purposes of computing foreign currency gain or loss under Internal Revenue Code section 988). I need to amend my 2011 taxes Due date of notification to IRS. I need to amend my 2011 taxes   If you pay less foreign tax than you originally claimed a credit for, in most cases you must file a notification by the due date (with extensions) of your original return for your tax year in which the foreign tax redetermination occurred. I need to amend my 2011 taxes There is no limit on the time the IRS has to redetermine and assess the correct U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes tax due. I need to amend my 2011 taxes If you pay more foreign tax than you originally claimed a credit for, you have 10 years to file a claim for refund of U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes taxes. I need to amend my 2011 taxes See Time Limit on Refund Claims , later. I need to amend my 2011 taxes   Exceptions to this due date are explained in the next two paragraphs. I need to amend my 2011 taxes Multiple redeterminations of U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes tax liability for same tax year. I need to amend my 2011 taxes   Where more than one foreign tax redetermination requires a redetermination of U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes tax liability for the same tax year and those redeterminations occur in the same tax year or within two consecutive tax years, you can file for that tax year one notification (Form 1040X with a Form 1116 and the required statement) that reflects all those tax redeterminations. I need to amend my 2011 taxes If you choose to file one notification, the due date for that notification is the due date of the original return (with extensions) for the year in which the first foreign tax redetermination that reduced your foreign tax liability occurred. I need to amend my 2011 taxes However, foreign tax redeterminations with respect to the tax year for which a redetermination of U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes tax liability is required may occur after the due date for providing that notification. I need to amend my 2011 taxes In this situation, you may have to file more than one Form 1040X for that tax year. I need to amend my 2011 taxes Additional U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes tax due eliminated by foreign tax credit carryback or carryover. I need to amend my 2011 taxes   If a foreign tax redetermination requires a redetermination of U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes tax liability that would otherwise result in an additional amount of U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes tax due, but the additional tax is eliminated by a carryback or carryover of an unused foreign tax, you do not have to amend your tax return for the year affected by the redetermination. I need to amend my 2011 taxes Instead, you can notify the IRS by attaching a statement to the original return for the tax year in which the foreign tax redetermination occurred. I need to amend my 2011 taxes You must file the statement by the due date (with extensions) of that return. I need to amend my 2011 taxes The statement must show the amount of the unused foreign taxes paid or accrued and a detailed schedule showing the computation of the carryback or carryover (including the amounts carried back or over to the year for which a redetermination on U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes tax liability is required). I need to amend my 2011 taxes Failure-to-notify penalty. I need to amend my 2011 taxes   If you fail to notify the IRS of a foreign tax redetermination and cannot show reasonable cause for the failure, you may have to pay a penalty. I need to amend my 2011 taxes   For each month, or part of a month, that the failure continues, you pay a penalty of 5% of the tax due resulting from a redetermination of your U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes tax. I need to amend my 2011 taxes This penalty cannot be more than 25% of the tax due. I need to amend my 2011 taxes Foreign tax refund. I need to amend my 2011 taxes   If you receive a foreign tax refund without interest from the foreign government, you will not have to pay interest on the amount of tax due resulting from the adjustment to your U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes tax for the time before the date of the refund. I need to amend my 2011 taxes   However, if you receive a foreign tax refund with interest, you must pay interest to the IRS up to the amount of the interest paid to you by the foreign government. I need to amend my 2011 taxes The interest you must pay cannot be more than the interest you would have had to pay on taxes that were unpaid for any other reason for the same period. I need to amend my 2011 taxes Interest also is owed from the time you receive a refund until you pay the additional tax due. I need to amend my 2011 taxes Foreign tax imposed on foreign refund. I need to amend my 2011 taxes   If your foreign tax refund is taxed by the foreign country, you cannot take a separate credit or deduction for this additional foreign tax. I need to amend my 2011 taxes However, when you refigure the foreign tax credit taken for the original foreign tax, reduce the amount of the refund by the foreign tax paid on the refund. I need to amend my 2011 taxes Example. I need to amend my 2011 taxes You paid a foreign income tax of $3,000 in 2011, and received a foreign tax refund of $500 in 2013 on which a foreign tax of $100 was imposed. I need to amend my 2011 taxes When you refigure your credit for 2011, you must reduce the $3,000 you paid by $400. I need to amend my 2011 taxes Time Limit on Refund Claims You have 10 years to file a claim for refund of U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes tax if you find that you paid or accrued a larger foreign tax than you claimed a credit for. I need to amend my 2011 taxes The 10-year period begins the day after the regular due date for filing the return (without extensions) for the year in which the taxes were actually paid or accrued. I need to amend my 2011 taxes You have 10 years to file your claim regardless of whether you claim the credit for taxes paid or taxes accrued. I need to amend my 2011 taxes The 10-year period applies to claims for refund or credit based on: Fixing math errors in figuring qualified foreign taxes, Reporting qualified foreign taxes not originally reported on the return, or Any other change in the size of the credit (including one caused by correcting the foreign tax credit limit). I need to amend my 2011 taxes The special 10-year period also applies to making or changing your choice to claim a deduction or credit for foreign taxes. I need to amend my 2011 taxes See Making or Changing Your Choice discussed earlier under Choosing To Take Credit or Deduction. I need to amend my 2011 taxes Who Can Take the Credit? U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes citizens, resident aliens, and nonresident aliens who paid foreign income tax and are subject to U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes tax on foreign source income may be able to take a foreign tax credit. I need to amend my 2011 taxes U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes Citizens If you are a U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes citizen, you are taxed by the United States on your worldwide income wherever you live. I need to amend my 2011 taxes You are normally entitled to take a credit for foreign taxes you pay or accrue. I need to amend my 2011 taxes Resident Aliens If you are a resident alien of the United States, you can take a credit for foreign taxes subject to the same general rules as U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes citizens. I need to amend my 2011 taxes If you are a bona fide resident of Puerto Rico for the entire tax year, you also come under the same rules. I need to amend my 2011 taxes Usually, you can take a credit only for those foreign taxes imposed on income you actually or constructively received while you had resident alien status. I need to amend my 2011 taxes For information on alien status, see Publication 519. I need to amend my 2011 taxes Nonresident Aliens If you are a nonresident alien, you cannot take the credit in most cases. I need to amend my 2011 taxes However, you may be able to take the credit if: You were a bona fide resident of Puerto Rico during your entire tax year, or You pay or accrue tax to a foreign country or U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes possession on income from foreign sources that is effectively connected with a trade or business in the United States. I need to amend my 2011 taxes But if you must pay tax to a foreign country or U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes possession on income from U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes sources only because you are a citizen or a resident of that country or U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes possession, do not use that tax in figuring the amount of your credit. I need to amend my 2011 taxes For information on alien status and effectively connected income, see Publication 519. I need to amend my 2011 taxes What Foreign Taxes Qualify for the Credit? In most cases, the following four tests must be met for any foreign tax to qualify for the credit. I need to amend my 2011 taxes The tax must be imposed on you. I need to amend my 2011 taxes You must have paid or accrued the tax. I need to amend my 2011 taxes The tax must be the legal and actual foreign tax liability. I need to amend my 2011 taxes The tax must be an income tax (or a tax in lieu of an income tax). I need to amend my 2011 taxes Certain foreign taxes do not qualify for the credit even if the four tests are met. I need to amend my 2011 taxes See Foreign Taxes for Which You Cannot Take a Credit, later. I need to amend my 2011 taxes Tax Must Be Imposed on You You can claim a credit only for foreign taxes that are imposed on you by a foreign country or U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes possession. I need to amend my 2011 taxes For example, a tax that is deducted from your wages is considered to be imposed on you. I need to amend my 2011 taxes You cannot shift the right to claim the credit by contract or other means. I need to amend my 2011 taxes Foreign country. I need to amend my 2011 taxes   A foreign country includes any foreign state and its political subdivisions. I need to amend my 2011 taxes Income, war profits, and excess profits taxes paid or accrued to a foreign city or province qualify for the foreign tax credit. I need to amend my 2011 taxes U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes possessions. I need to amend my 2011 taxes   For foreign tax credit purposes, all qualified taxes paid to U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes possessions are considered foreign taxes. I need to amend my 2011 taxes For this purpose, U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes possessions include Puerto Rico and American Samoa. I need to amend my 2011 taxes   When the term “foreign country” is used in this publication, it includes U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes possessions unless otherwise stated. I need to amend my 2011 taxes You Must Have Paid or Accrued the Tax In most cases, you can claim the credit only if you paid or accrued the foreign tax to a foreign country or U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes possession. I need to amend my 2011 taxes However, the paragraphs that follow describe some instances in which you can claim the credit even if you did not directly pay or accrue the tax yourself. I need to amend my 2011 taxes Joint return. I need to amend my 2011 taxes   If you file a joint return, you can claim the credit based on the total foreign income taxes paid or accrued by you and your spouse. I need to amend my 2011 taxes Combined income. I need to amend my 2011 taxes   If foreign tax is imposed on the combined income of two or more persons (for example, spouses), the tax is allocated among, and considered paid by, these persons on a pro rata basis in proportion to each person's portion of the combined income, as determined under foreign law and Regulations section 1. I need to amend my 2011 taxes 901-2(f)(3)(iii). I need to amend my 2011 taxes Combined income with respect to each foreign tax that is imposed on a combined basis (and combined income subject to tax exemption or preferential tax rates) is computed separately, and the tax on that combined income is allocated separately. I need to amend my 2011 taxes   These rules apply to foreign taxes paid or accrued in tax years beginning after February 14, 2012. I need to amend my 2011 taxes However, you can choose to apply the new rules to foreign taxes paid or accrued in tax years beginning after December 31, 2010, and before February 15, 2012. I need to amend my 2011 taxes For more details, see paragraphs (f) and (h) of Regulations section 1. I need to amend my 2011 taxes 901-2. I need to amend my 2011 taxes For similar rules applicable to prior tax years, see Regulations section 1. I need to amend my 2011 taxes 901-2 (revised as of April 1, 2011). I need to amend my 2011 taxes Example. I need to amend my 2011 taxes You and your spouse reside in Country X, which imposes income tax on your combined incomes. I need to amend my 2011 taxes Both of you use the “u” as your functional currency. I need to amend my 2011 taxes Country X apportions tax based on income. I need to amend my 2011 taxes You had income of 30,000u and your spouse had income of 20,000u. I need to amend my 2011 taxes Your filing status on your U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes income tax return is married filing separately. I need to amend my 2011 taxes You can claim only 60% (30,000u/50,000u) of the foreign taxes imposed on your income on your U. I need to amend my 2011 taxes S income tax return. I need to amend my 2011 taxes Your spouse can claim only 40% (20,000u/50,000u). I need to amend my 2011 taxes Partner or S corporation shareholder. I need to amend my 2011 taxes   If you are a member of a partnership, or a shareholder in an S corporation, you can claim the credit based on your proportionate share of the foreign income taxes paid or accrued by the partnership or the S corporation. I need to amend my 2011 taxes These amounts will be shown on the Schedule K-1 you receive from the partnership or S corporation. I need to amend my 2011 taxes However, if you are a shareholder in an S corporation that in turn owns stock in a foreign corporation, you cannot claim a credit for your share of foreign taxes paid by the foreign corporation. I need to amend my 2011 taxes Beneficiary. I need to amend my 2011 taxes   If you are a beneficiary of an estate or trust, you may be able to claim the credit based on your proportionate share of foreign income taxes paid or accrued by the estate or trust. I need to amend my 2011 taxes This amount will be shown on the Schedule K-1 you receive from the estate or trust. I need to amend my 2011 taxes However, you must show that the tax was imposed on income of the estate and not on income received by the decedent. I need to amend my 2011 taxes Mutual fund shareholder. I need to amend my 2011 taxes   If you are a shareholder of a mutual fund or other regulated investment company (RIC), you may be able to claim the credit based on your share of foreign income taxes paid by the fund if it chooses to pass the credit on to its shareholders. I need to amend my 2011 taxes You should receive from the mutual fund or other RIC a Form 1099-DIV, or similar statement, showing your share of the foreign income, and your share of the foreign taxes paid. I need to amend my 2011 taxes If you do not receive this information, you will need to contact the fund. I need to amend my 2011 taxes Controlled foreign corporation shareholder. I need to amend my 2011 taxes   If you are a shareholder of a controlled foreign corporation and choose to be taxed at corporate rates on the amount you must include in gross income from that corporation, you can claim the credit based on your share of foreign taxes paid or accrued by the controlled foreign corporation. I need to amend my 2011 taxes If you make this election, you must claim the credit by filing Form 1118, Foreign Tax Credit—Corporations. I need to amend my 2011 taxes Controlled foreign corporation. I need to amend my 2011 taxes   A controlled foreign corporation is a foreign corporation in which U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes shareholders own more than 50% of the voting power or value of the stock. I need to amend my 2011 taxes You are considered a U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes shareholder if you own, directly or indirectly, 10% or more of the total voting power of all classes of the foreign corporation's stock. I need to amend my 2011 taxes See Internal Revenue Code sections 951(b) and 958(b) for more information. I need to amend my 2011 taxes Tax Must Be the Legal and Actual Foreign Tax Liability The amount of foreign tax that qualifies is not necessarily the amount of tax withheld by the foreign country. I need to amend my 2011 taxes Only the legal and actual foreign tax liability that you paid or accrued during the year qualifies for the credit. I need to amend my 2011 taxes Foreign tax refund. I need to amend my 2011 taxes   You cannot take a foreign tax credit for income taxes paid to a foreign country if it is reasonably certain the amount would be refunded, credited, rebated, abated, or forgiven if you made a claim. I need to amend my 2011 taxes   For example, the United States has tax treaties with many countries allowing U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes citizens and residents reductions in the rates of tax of those foreign countries. I need to amend my 2011 taxes However, some treaty countries require U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes citizens and residents to pay the tax figured without regard to the lower treaty rates and then claim a refund for the amount by which the tax actually paid is more than the amount of tax figured using the lower treaty rate. I need to amend my 2011 taxes The qualified foreign tax is the amount figured using the lower treaty rate and not the amount actually paid, because the excess tax is refundable. I need to amend my 2011 taxes Subsidy received. I need to amend my 2011 taxes   Tax payments a foreign country returns to you in the form of a subsidy do not qualify for the foreign tax credit. I need to amend my 2011 taxes This rule applies even if the subsidy is given to a person related to you, or persons who participated with you in a transaction or a related transaction. I need to amend my 2011 taxes A subsidy can be provided by any means but must be determined, directly or indirectly, in relation to the amount of tax, or to the base used to figure the tax. I need to amend my 2011 taxes   The term “subsidy” includes any type of benefit. I need to amend my 2011 taxes Some ways of providing a subsidy are refunds, credits, deductions, payments, or discharges of obligations. I need to amend my 2011 taxes Shareholder receiving refund for corporate tax in integrated system. I need to amend my 2011 taxes   Under some foreign tax laws and treaties, a shareholder is considered to have paid part of the tax that is imposed on the corporation. I need to amend my 2011 taxes You may be able to claim a refund of these taxes from the foreign government. I need to amend my 2011 taxes You must include the refund (including any amount withheld) in your income in the year received. I need to amend my 2011 taxes Any tax withheld from the refund is a qualified foreign tax. I need to amend my 2011 taxes Example. I need to amend my 2011 taxes You are a shareholder of a French corporation. I need to amend my 2011 taxes You receive a $100 refund of the tax paid to France by the corporation on the earnings distributed to you as a dividend. I need to amend my 2011 taxes The French government imposes a 15% withholding tax ($15) on the refund you received. I need to amend my 2011 taxes You receive a check for $85. I need to amend my 2011 taxes You include $100 in your income. I need to amend my 2011 taxes The $15 of tax withheld is a qualified foreign tax. I need to amend my 2011 taxes Tax Must Be an Income Tax (or Tax in Lieu of Income Tax) In most cases, only income, war profits, and excess profits taxes (income taxes) qualify for the foreign tax credit. I need to amend my 2011 taxes Foreign taxes on wages, dividends, interest, and royalties qualify for the credit in most cases. I need to amend my 2011 taxes Furthermore, foreign taxes on income can qualify even though they are not imposed under an income tax law if the tax is in lieu of an income, war profits, or excess profits tax. I need to amend my 2011 taxes See Taxes in Lieu of Income Taxes , later. I need to amend my 2011 taxes Income Tax Simply because the levy is called an income tax by the foreign taxing authority does not make it an income tax for this purpose. I need to amend my 2011 taxes A foreign levy is an income tax only if it meets both of the following requirements. I need to amend my 2011 taxes It is a tax; that is, you have to pay it and you get no specific economic benefit (discussed below) from paying it. I need to amend my 2011 taxes The predominant character of the tax is that of an income tax in the U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes sense. I need to amend my 2011 taxes A foreign levy may meet these requirements even if the foreign tax law differs from U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes tax law. I need to amend my 2011 taxes The foreign law may include in income items that U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes law does not include, or it may allow certain exclusions or deductions that U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes law does not allow. I need to amend my 2011 taxes Specific economic benefit. I need to amend my 2011 taxes   In most cases, you get a specific economic benefit if you receive, or are considered to receive, an economic benefit from the foreign country imposing the levy, and: If there is a generally imposed income tax, the economic benefit is not available on substantially the same terms to all persons subject to the income tax, or If there is no generally imposed income tax, the economic benefit is not available on substantially the same terms to the population of the foreign country in general. I need to amend my 2011 taxes   You are considered to receive a specific economic benefit if you have a business transaction with a person who receives a specific economic benefit from the foreign country and, under the terms and conditions of the transaction, you receive directly or indirectly all or part of the benefit. I need to amend my 2011 taxes   However, see the exception discussed later under Pension, unemployment, and disability fund payments . I need to amend my 2011 taxes Economic benefits. I need to amend my 2011 taxes   Economic benefits include the following. I need to amend my 2011 taxes Goods. I need to amend my 2011 taxes Services. I need to amend my 2011 taxes Fees or other payments. I need to amend my 2011 taxes Rights to use, acquire, or extract resources, patents, or other property the foreign country owns or controls. I need to amend my 2011 taxes Discharges of contractual obligations. I need to amend my 2011 taxes   In most cases, the right or privilege merely to engage in business is not an economic benefit. I need to amend my 2011 taxes Dual-capacity taxpayers. I need to amend my 2011 taxes   If you are subject to a foreign country's levy and you also receive a specific economic benefit from that foreign country, you are a “dual-capacity taxpayer. I need to amend my 2011 taxes ” As a dual-capacity taxpayer, you cannot claim a credit for any part of the foreign levy, unless you establish that the amount paid under a distinct element of the foreign levy is a tax, rather than a compulsory payment for a direct or indirect specific economic benefit. I need to amend my 2011 taxes    For more information on how to establish amounts paid under separate elements of a levy, write to: Internal Revenue Service International Section Philadelphia, PA 19255-0725 Pension, unemployment, and disability fund payments. I need to amend my 2011 taxes   A foreign tax imposed on an individual to pay for retirement, old-age, death, survivor, unemployment, illness, or disability benefits, or for substantially similar purposes, is not payment for a specific economic benefit if the amount of the tax does not depend on the age, life expectancy, or similar characteristics of that individual. I need to amend my 2011 taxes    No deduction or credit is allowed, however, for social security taxes paid or accrued to a foreign country with which the United States has a social security agreement. I need to amend my 2011 taxes For more information about these agreements, see Publication 54. I need to amend my 2011 taxes Soak-up taxes. I need to amend my 2011 taxes   A foreign tax is not predominantly an income tax and does not qualify for credit to the extent it is a soak-up tax. I need to amend my 2011 taxes A tax is a soak-up tax to the extent that liability for it depends on the availability of a credit for it against income tax imposed by another country. I need to amend my 2011 taxes This rule applies only if and to the extent that the foreign tax would not be imposed if the credit were not available. I need to amend my 2011 taxes Penalties and interest. I need to amend my 2011 taxes   Amounts paid to a foreign government to satisfy a liability for interest, fines, penalties, or any similar obligation are not taxes and do not qualify for the credit. I need to amend my 2011 taxes Taxes not based on income. I need to amend my 2011 taxes   Foreign taxes based on gross receipts or the number of units produced, rather than on realized net income, do not qualify unless they are imposed in lieu of an income tax, as discussed next. I need to amend my 2011 taxes Taxes based on assets, such as property taxes, do not qualify for the credit. I need to amend my 2011 taxes Taxes in Lieu of Income Taxes A tax paid or accrued to a foreign country qualifies for the credit if it is imposed in lieu of an income tax otherwise generally imposed. I need to amend my 2011 taxes A foreign levy is a tax in lieu of an income tax only if: It is not payment for a specific economic benefit as discussed earlier, and The tax is imposed in place of, and not in addition to, an income tax otherwise generally imposed. I need to amend my 2011 taxes A tax in lieu of an income tax does not have to be based on realized net income. I need to amend my 2011 taxes A foreign tax imposed on gross income, gross receipts or sales, or the number of units produced or exported can qualify for the credit. I need to amend my 2011 taxes In most cases, a soak-up tax (discussed earlier) does not qualify as a tax in lieu of an income tax. I need to amend my 2011 taxes However, if the foreign country imposes a soak-up tax in lieu of an income tax, the amount that does not qualify for foreign tax credit is the lesser of the following amounts. I need to amend my 2011 taxes The soak-up tax. I need to amend my 2011 taxes The foreign tax you paid that is more than the amount you would have paid if you had been subject to the generally imposed income tax. I need to amend my 2011 taxes Foreign Taxes for Which You Cannot Take a Credit This part discusses the foreign taxes for which you cannot take a credit. I need to amend my 2011 taxes These are: Taxes on excluded income, Taxes for which you can only take an itemized deduction, Taxes on foreign mineral income, Taxes from international boycott operations, A portion of taxes on combined foreign oil and gas income, Taxes of U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes persons controlling foreign corporations and partnerships who fail to file required information returns, and Taxes related to a foreign tax splitting event. I need to amend my 2011 taxes Taxes on Excluded Income You cannot take a credit for foreign taxes paid or accrued on certain income that is excluded from U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes gross income. I need to amend my 2011 taxes Foreign Earned Income and Housing Exclusions You must reduce your foreign taxes available for the credit by the amount of those taxes paid or accrued on income that is excluded from U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes income under the foreign earned income exclusion or the foreign housing exclusion. I need to amend my 2011 taxes See Publication 54 for more information on the foreign earned income and housing exclusions. I need to amend my 2011 taxes Wages completely excluded. I need to amend my 2011 taxes   If your wages are completely excluded, you cannot take a credit for any of the foreign taxes paid or accrued on these wages. I need to amend my 2011 taxes Wages partly excluded. I need to amend my 2011 taxes   If only part of your wages is excluded, you cannot take a credit for the foreign income taxes allocable to the excluded part. I need to amend my 2011 taxes You find the amount allocable to your excluded wages by multiplying the foreign tax paid or accrued on foreign earned income received or accrued during the tax year by a fraction. I need to amend my 2011 taxes   The numerator of the fraction is your foreign earned income and housing amounts excluded under the foreign earned income and housing exclusions for the tax year minus otherwise deductible expenses definitely related and properly apportioned to that income. I need to amend my 2011 taxes Deductible expenses do not include the foreign housing deduction. I need to amend my 2011 taxes   The denominator is your total foreign earned income received or accrued during the tax year minus all deductible expenses allocable to that income (including the foreign housing deduction). I need to amend my 2011 taxes If the foreign law taxes foreign earned income and some other income (for example, earned income from U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes sources or a type of income not subject to U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes tax), and the taxes on the other income cannot be segregated, the denominator of the fraction is the total amount of income subject to the foreign tax minus deductible expenses allocable to that income. I need to amend my 2011 taxes Example. I need to amend my 2011 taxes You are a U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes citizen and a cash basis taxpayer, employed by Company X and living in Country A. I need to amend my 2011 taxes Your records show the following: Foreign earned income received $125,000 Unreimbursed business travel expenses 20,000 Income tax paid to Country A 30,000 Exclusion of foreign earned  income and housing allowance 97,600     Because you can exclude part of your wages, you cannot claim a credit for part of the foreign taxes. I need to amend my 2011 taxes To find that part, do the following. I need to amend my 2011 taxes First, find the amount of business expenses allocable to excluded wages and therefore not deductible. I need to amend my 2011 taxes To do this, multiply the otherwise deductible expenses by a fraction. I need to amend my 2011 taxes That fraction is the excluded wages over your foreign earned income. I need to amend my 2011 taxes   $20,000 × $97,600 $125,000 = $15,616             Next, find the numerator of the fraction by which you will multiply the foreign taxes paid. I need to amend my 2011 taxes To do this, subtract business expenses allocable to excluded wages ($15,616) from excluded wages ($97,600). I need to amend my 2011 taxes The result is $81,984. I need to amend my 2011 taxes Then, find the denominator of the fraction by subtracting all your deductible expenses from all your foreign earned income ($125,000 − $20,000 = $105,000). I need to amend my 2011 taxes Finally, multiply the foreign tax you paid by the resulting fraction. I need to amend my 2011 taxes   $30,000 × $81,984  $105,000 = $23,424 The amount of Country A tax you cannot take a credit for is $23,424. I need to amend my 2011 taxes Taxes on Income From Puerto Rico Exempt From U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes Tax If you have income from Puerto Rican sources that is not taxable, you must reduce your foreign taxes paid or accrued by the taxes allocable to the exempt income. I need to amend my 2011 taxes For information on figuring the reduction, see Publication 570. I need to amend my 2011 taxes Possession Exclusion If you are a bona fide resident of American Samoa and exclude income from sources in American Samoa, you cannot take a credit for the taxes you pay or accrue on the excluded income. I need to amend my 2011 taxes For more information on this exclusion, see Publication 570. I need to amend my 2011 taxes Extraterritorial Income Exclusion You cannot take a credit for taxes you pay on qualifying foreign trade income excluded on Form 8873, Extraterritorial Income Exclusion. I need to amend my 2011 taxes However, see Internal Revenue Code section 943(d) for an exception for certain withholding taxes. I need to amend my 2011 taxes Taxes for Which You Can Only Take an Itemized Deduction You cannot claim a foreign tax credit for foreign income taxes paid or accrued under the following circumstances. I need to amend my 2011 taxes However, you can claim an itemized deduction for these taxes. I need to amend my 2011 taxes See Choosing To Take Credit or Deduction , earlier. I need to amend my 2011 taxes Taxes Imposed By Sanctioned Countries (Section 901(j) Income) You cannot claim a foreign tax credit for income taxes paid or accrued to any country if the income giving rise to the tax is for a period (the sanction period) during which: The Secretary of State has designated the country as one that repeatedly provides support for acts of international terrorism, The United States has severed or does not conduct diplomatic relations with the country, or The United States does not recognize the country's government, and that government is not otherwise eligible to purchase defense articles or services under the Arms Export Control Act. I need to amend my 2011 taxes The following countries meet this description for 2013. I need to amend my 2011 taxes Income taxes paid or accrued to these countries in 2013 do not qualify for the credit. I need to amend my 2011 taxes Cuba. I need to amend my 2011 taxes Iran. I need to amend my 2011 taxes Libya (but see Note later). I need to amend my 2011 taxes North Korea. I need to amend my 2011 taxes Sudan. I need to amend my 2011 taxes Syria. I need to amend my 2011 taxes Waiver of denial of the credit. I need to amend my 2011 taxes   A waiver can be granted to a sanctioned country if the President of the United States determines that granting the waiver is in the national interest of the United States and will expand trade and investment opportunities for U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes companies in the sanctioned country. I need to amend my 2011 taxes The President must report to Congress his intentions to grant the waiver and his reasons for granting the waiver not less than 30 days before the date on which the waiver is granted. I need to amend my 2011 taxes Note. I need to amend my 2011 taxes Effective December 10, 2004, the President granted a waiver to Libya. I need to amend my 2011 taxes Income taxes arising on or after this date qualify for the credit if they meet the other requirements in this publication. I need to amend my 2011 taxes Limit on credit. I need to amend my 2011 taxes   In figuring the foreign tax credit limit, discussed later, income from a sanctioned country is a separate category of foreign income unless a Presidential waiver is granted. I need to amend my 2011 taxes You must fill out a separate Form 1116 for this income. I need to amend my 2011 taxes This will prevent you from claiming a credit for foreign taxes paid or accrued to the sanctioned country. I need to amend my 2011 taxes Example. I need to amend my 2011 taxes You lived and worked in Iran until August, when you were transferred to Italy. I need to amend my 2011 taxes You paid taxes to each country on the income earned in that country. I need to amend my 2011 taxes You cannot claim a foreign tax credit for the foreign taxes paid on the income earned in Iran. I need to amend my 2011 taxes Because the income earned in Iran is a separate category of foreign income, you must fill out a separate Form 1116 for that income. I need to amend my 2011 taxes You cannot take a credit for taxes paid on the income earned in Iran, but that income is taxable by the United States. I need to amend my 2011 taxes Figuring the credit when a sanction ends. I need to amend my 2011 taxes    Table 1 lists the countries for which sanctions have ended or for which a Presidential waiver has been granted. I need to amend my 2011 taxes For any of these countries, you can claim a foreign tax credit for the taxes paid or accrued to that country on the income for the period that begins after the end of the sanction period or the date the Presidential waiver was granted. I need to amend my 2011 taxes Example. I need to amend my 2011 taxes The sanctions against Country X ended on July 31. I need to amend my 2011 taxes On August 19, you receive a distribution from a mutual fund of Country X income. I need to amend my 2011 taxes The fund paid Country X income tax for you on the distribution. I need to amend my 2011 taxes Because the distribution was made after the sanction ended, you may include the foreign tax paid on the distribution to compute your foreign tax credit. I need to amend my 2011 taxes Amounts for the nonsanctioned period. I need to amend my 2011 taxes   If a sanction period ends (or a Presidential waiver is granted) during your tax year and you are not able to determine the actual income and taxes for that period, you can allocate amounts to that period based on the number of days in the period that fall in your tax year. I need to amend my 2011 taxes Multiply the income or taxes for the year by the following fraction to determine the amounts allocable to that period. I need to amend my 2011 taxes   Number of nonsanctioned days in year  Number of days in year Example. I need to amend my 2011 taxes You are a calendar year filer and received $20,000 of income from Country X in 2013 on which you paid tax of $4,500. I need to amend my 2011 taxes Sanctions against Country X ended on July 11, 2013. I need to amend my 2011 taxes You are unable to determine how much of the income or tax is for the nonsanctioned period. I need to amend my 2011 taxes Because your tax year starts on January 1, and the Country X sanction ended on July 11, 2013, 173 days of your tax year are in the nonsanctioned period. I need to amend my 2011 taxes You would compute the income for the nonsanctioned period as follows. I need to amend my 2011 taxes 173 365 × $20,000 = $9,479             You would figure the tax for the nonsanctioned period as follows. I need to amend my 2011 taxes 173 365 × $4,500 = $2,133 To figure your foreign tax credit, you would use $9,479 as the income from Country X and $2,133 as the tax. I need to amend my 2011 taxes Further information. I need to amend my 2011 taxes   The rules for figuring the foreign tax credit after a country's sanction period ends are more fully explained in Revenue Ruling 92-62, Cumulative Bulletin 1992-2, page 193. I need to amend my 2011 taxes This Cumulative Bulletin can be found in many libraries and IRS offices. I need to amend my 2011 taxes Table 1. I need to amend my 2011 taxes Countries Removed From the Sanction List or Granted Presidential Waiver   Sanction Period Country Starting Date Ending Date Iraq February 1, 1991 June 27, 2004 Libya January 1, 1987 December 9, 2004* *Presidential waiver granted for qualified income taxes arising after December 9, 2004. I need to amend my 2011 taxes Taxes Imposed on Certain Dividends You cannot claim a foreign tax credit for withholding tax (defined later ) on dividends paid or accrued if either of the following applies to the dividends. I need to amend my 2011 taxes The dividends are on stock you held for less than 16 days during the 31-day period that begins 15 days before the ex-dividend date (defined later). I need to amend my 2011 taxes The dividends are for a period or periods totaling more than 366 days on preferred stock you held for less than 46 days during the 91-day period that begins 45 days before the ex-dividend date. I need to amend my 2011 taxes If the dividend is not for more than 366 days, rule (1) applies to the preferred stock. I need to amend my 2011 taxes When figuring how long you held the stock, count the day you sold it, but do not count the day you acquired it or any days on which you were protected from risk of loss. I need to amend my 2011 taxes Regardless of how long you held the stock, you cannot claim the credit to the extent you have an obligation under a short sale or otherwise to make payments related to the dividend for positions in substantially similar or related property. I need to amend my 2011 taxes Withholding tax. I need to amend my 2011 taxes   For this purpose, withholding tax includes any tax determined on a gross basis. I need to amend my 2011 taxes It does not include any tax which is in the nature of a prepayment of a tax imposed on a net basis. I need to amend my 2011 taxes Ex-dividend date. I need to amend my 2011 taxes   The ex-dividend date is the first date following the declaration of a dividend on which the purchaser of a stock is not entitled to receive the next dividend payment. I need to amend my 2011 taxes Example 1. I need to amend my 2011 taxes You bought common stock from a foreign corporation on November 3. I need to amend my 2011 taxes You sold the stock on November 19. I need to amend my 2011 taxes You received a dividend on this stock because you owned it on the ex-dividend date of November 5. I need to amend my 2011 taxes To claim the credit, you must have held the stock for at least 16 days within the 31-day period that began on October 21 (15 days before the ex-dividend date). I need to amend my 2011 taxes Because you held the stock for 16 days, from November 4 until November 19, you are entitled to the credit. I need to amend my 2011 taxes Example 2. I need to amend my 2011 taxes The facts are the same as in Example 1 except that you sold the stock on November 14. I need to amend my 2011 taxes You held the stock for only 11 days. I need to amend my 2011 taxes You are not entitled to the credit. I need to amend my 2011 taxes Exception. I need to amend my 2011 taxes   If you are a securities dealer who actively conducts business in a foreign country, you may be able to claim a foreign tax credit for qualified taxes paid on dividends regardless of how long you held the stock or whether you were obligated to make payments for positions in substantially similar or related property. I need to amend my 2011 taxes See section 901(k)(4) of the Internal Revenue Code for more information. I need to amend my 2011 taxes Taxes Withheld on Income or Gain (Other Than Dividends) For income or gain (other than dividends) paid or accrued on property, you cannot claim a foreign tax credit for withholding tax (defined later): If you have not held the property for at least 16 days during the 31-day period that begins 15 days before the date on which the right to receive the payment arises, or To the extent you have to make related payments on positions in substantially similar or related property. I need to amend my 2011 taxes When figuring how long you held the property, count the day you sold it, but do not count the day you acquired it or any days on which you were protected from risk of loss. I need to amend my 2011 taxes Withholding tax. I need to amend my 2011 taxes   For this purpose, withholding tax includes any tax determined on a gross basis. I need to amend my 2011 taxes It does not include any tax which is in the nature of a prepayment of a tax imposed on a net basis. I need to amend my 2011 taxes Exception for dealers. I need to amend my 2011 taxes   If you are a dealer in property who actively conducts business in a foreign country, you may be able to claim a foreign tax credit for qualified taxes withheld on income or gain from that property regardless of how long you held it or whether you have to make related payments on positions in substantially similar or related property. I need to amend my 2011 taxes See section 901(I)(2) of the Internal Revenue Code for more information. I need to amend my 2011 taxes Covered Asset Acquisition ???You cannot take a credit for the disqualified portion of any foreign tax paid or accrued in connection with a covered asset acquisition. I need to amend my 2011 taxes A covered asset acquisition includes certain acquisitions that result in a stepped-up basis for U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes tax purposes but not for foreign tax purposes. I need to amend my 2011 taxes For more information, see Internal Revenue Code section 901(m). I need to amend my 2011 taxes The IRS intends to issue guidance that will explain this provision in greater detail. I need to amend my 2011 taxes Taxes in Connection With the Purchase or Sale of Oil or Gas You cannot claim a foreign tax credit for taxes paid or accrued to a foreign country in connection with the purchase or sale of oil or gas extracted in that country if you do not have an economic interest in the oil or gas, and the purchase price or sales price is different from the fair market value of the oil or gas at the time of purchase or sale. I need to amend my 2011 taxes Taxes on Foreign Mineral Income You must reduce any taxes paid or accrued to a foreign country or possession on mineral income from that country or possession if you were allowed a deduction for percentage depletion for any part of the mineral income. I need to amend my 2011 taxes For details, see Regulations section 1. I need to amend my 2011 taxes 901-3. I need to amend my 2011 taxes Taxes From International Boycott Operations If you participate in or cooperate with an international boycott during the tax year, your foreign taxes resulting from boycott activities will reduce the total taxes available for credit. I need to amend my 2011 taxes See the instructions for line 12 in the Form 1116 instructions to figure this reduction. I need to amend my 2011 taxes In most cases, this rule does not apply to employees with wages who are working and living in boycotting countries, or to retirees with pensions who are living in these countries. I need to amend my 2011 taxes List of boycotting countries. I need to amend my 2011 taxes   A list of the countries which may require participation in or cooperation with an international boycott is published by the Department of the Treasury. I need to amend my 2011 taxes As of November 2013, the following countries are listed. I need to amend my 2011 taxes Iraq. I need to amend my 2011 taxes Kuwait. I need to amend my 2011 taxes Lebanon. I need to amend my 2011 taxes Libya. I need to amend my 2011 taxes Qatar. I need to amend my 2011 taxes Saudi Arabia. I need to amend my 2011 taxes Syria. I need to amend my 2011 taxes United Arab Emirates. I need to amend my 2011 taxes Yemen. I need to amend my 2011 taxes    For information concerning changes to the list, write to: Internal Revenue Service International Section Philadelphia, PA 19255-0725 Determinations of whether the boycott rule applies. I need to amend my 2011 taxes   You may request a determination from the Internal Revenue Service as to whether a particular operation constitutes participation in or cooperation with an international boycott. I need to amend my 2011 taxes The procedures for obtaining a determination from the Service are outlined in Revenue Procedure 77-9 in Cumulative Bulletin 1977-1. I need to amend my 2011 taxes Cumulative Bulletins are available in most IRS offices and you are welcome to read them there. I need to amend my 2011 taxes Public inspection. I need to amend my 2011 taxes   A determination and any related background file is open to public inspection. I need to amend my 2011 taxes However, your identity and certain other information will remain confidential. I need to amend my 2011 taxes Reporting requirements. I need to amend my 2011 taxes   You must file a report with the IRS if you or any of the following persons have operations in or related to a boycotting country or with the government, a company, or a national of a boycotting country. I need to amend my 2011 taxes A foreign corporation in which you own 10% or more of the voting power of all voting stock but only if you own the stock of the foreign corporation directly or through foreign entities. I need to amend my 2011 taxes A partnership in which you are a partner. I need to amend my 2011 taxes A trust you are treated as owning. I need to amend my 2011 taxes Form 5713 required. I need to amend my 2011 taxes   If you have to file a report, you must use Form 5713, International Boycott Report, and attach all supporting schedules. I need to amend my 2011 taxes See the Instructions for Form 5713 for information on when and where to file the form. I need to amend my 2011 taxes Penalty for failure to file. I need to amend my 2011 taxes   If you willfully fail to make a report, in addition to other penalties, you may be fined $25,000 or imprisoned for no more than one year, or both. I need to amend my 2011 taxes Taxes on Combined Foreign Oil and Gas Income You must reduce your foreign taxes by a portion of any foreign taxes imposed on combined foreign oil and gas income. I need to amend my 2011 taxes The amount of the reduction is the amount by which your foreign oil and gas taxes exceed the amount of your combined foreign oil and gas income multiplied by a fraction equal to your pre-credit U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes tax liability (Form 1040, line 44) divided by your worldwide taxable income. I need to amend my 2011 taxes You may be entitled to carry over to other years taxes reduced under this rule. I need to amend my 2011 taxes See Internal Revenue Code section 907(f). I need to amend my 2011 taxes Combined foreign oil and gas income means the sum of foreign oil related income and foreign oil and gas extraction income. I need to amend my 2011 taxes Foreign oil and gas taxes are the sum of foreign oil and gas extraction taxes and foreign oil related taxes. I need to amend my 2011 taxes Taxes of U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes Persons Controlling Foreign Corporations and Partnerships If you had control of a foreign corporation or a foreign partnership for the annual accounting period of that corporation or partnership that ended with or within your tax year, you may have to file an annual information return. I need to amend my 2011 taxes If you do not file the required information return, you may have to reduce the foreign taxes that may be used for the foreign tax credit. I need to amend my 2011 taxes See Penalty for not filing Form 5471 or Form 8865 , later. I need to amend my 2011 taxes U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes persons controlling foreign corporations. I need to amend my 2011 taxes   If you are a U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes citizen or resident who had control of a foreign corporation for an uninterrupted period of at least 30 days during the annual accounting period of that corporation, you may have to file an annual information return on Form 5471, Information Return of U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes Persons With Respect To Certain Foreign Corporations. I need to amend my 2011 taxes Under this rule, you generally had control of a foreign corporation if at any time during your tax year you owned: Stock possessing more than 50% of the total combined voting power of all classes of stock entitled to vote, or More than 50% of the total value of shares of all classes of stock of the foreign corporation. I need to amend my 2011 taxes U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes persons controlling foreign partnerships. I need to amend my 2011 taxes   If you are a U. I need to amend my 2011 taxes S. I need to amend my 2011 taxes citizen or resident who had control of a foreign partnership at any time during the partnership's tax year, you may have to file