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Senior Taxes

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Senior Taxes

Senior taxes 6. Senior taxes   How To Report Table of Contents Where To ReportGifts. Senior taxes Statutory employees. Senior taxes Vehicle Provided by Your Employer ReimbursementsAccountable Plans Nonaccountable Plans Rules for Independent Contractors and Clients How To Use Per Diem Rate TablesThe Two Substantiation Methods Transition Rules Completing Forms 2106 and 2106-EZInformation on use of cars. Senior taxes Standard mileage rate. Senior taxes Actual expenses. Senior taxes Car rentals. Senior taxes Hours of service limits. Senior taxes Allocating your reimbursement. Senior taxes 1. Senior taxes Limit on meals and entertainment. Senior taxes 2. Senior taxes Limit on miscellaneous itemized deductions. Senior taxes 3. Senior taxes Limit on total itemized deductions. Senior taxes Special Rules This chapter explains where and how to report the expenses discussed in this publication. Senior taxes It discusses reimbursements and how to treat them under accountable and nonaccountable plans. Senior taxes It also explains rules for independent contractors and clients, fee-basis officials, certain performing artists, Armed Forces reservists, and certain disabled employees. Senior taxes The chapter ends with illustrations of how to report travel, entertainment, gift, and car expenses on Forms 2106 and 2106-EZ. Senior taxes Where To Report This section provides general information on where to report the expenses discussed in this publication. Senior taxes Self-employed. Senior taxes   You must report your income and expenses on Schedule C (Form 1040) or Schedule C-EZ (Form 1040) if you are a sole proprietor, or on Schedule F (Form 1040) if you are a farmer. Senior taxes You do not use Form 2106 or 2106-EZ. Senior taxes    If you claim car or truck expenses, you must provide certain information on the use of your vehicle. Senior taxes You provide this information on Schedule C (Form 1040), Schedule C-EZ (Form 1040), or Form 4562. Senior taxes   If you file Schedule C (Form 1040): Report your travel expenses, except meals, on line 24a, Report your deductible meals (actual cost or standard meal allowance) and entertainment on line 24b, Report your gift expenses and transportation expenses, other than car expenses, on line 27a, and Report your car expenses on line 9. Senior taxes Complete Part IV of the form unless you have to file Form 4562 for depreciation or amortization. Senior taxes   If you file Schedule C-EZ (Form 1040), report the total of all business expenses on line 2. Senior taxes You can only include 50% of your meals and entertainment in that total. Senior taxes If you include car expenses, you must also complete Part III of the form. Senior taxes    If you file Schedule F (Form 1040): Report your car expenses on line 10. Senior taxes Attach Form 4562 and provide information on the use of your car in Part V of Form 4562. Senior taxes Report all other business expenses discussed in this publication on line 32. Senior taxes You can only include 50% of your meals and entertainment on that line. Senior taxes See your form instructions for more information on how to complete your tax return. Senior taxes Both self-employed and an employee. Senior taxes   If you are both self-employed and an employee, you must keep separate records for each business activity. Senior taxes Report your business expenses for self-employment on Schedule C (Form 1040), Schedule C-EZ (Form 1040), or Schedule F (Form 1040), as discussed earlier. Senior taxes Report your business expenses for your work as an employee on Form 2106 or 2106-EZ, as discussed next. Senior taxes Employees. Senior taxes    If you are an employee, you generally must complete Form 2106 to deduct your travel, transportation, and entertainment expenses. Senior taxes However, you can use the shorter Form 2106-EZ instead of Form 2106 if you meet all of the following conditions. Senior taxes You are an employee deducting expenses attributable to your job. Senior taxes You were not reimbursed by your employer for your expenses (amounts included in box 1 of your Form W-2 are not considered reimbursements). Senior taxes If you claim car expenses, you use the standard mileage rate. Senior taxes   For more information on how to report your expenses on Forms 2106 and 2106-EZ, see Completing Forms 2106 and 2106-EZ , later. Senior taxes Gifts. Senior taxes   If you did not receive any reimbursements (or the reimbursements were all included in box 1 of your Form W-2), the only business expense you are claiming is for gifts, and the Special Rules discussed later do not apply to you, do not complete Form 2106 or 2106-EZ. Senior taxes Instead, claim the amount of your deductible gifts directly on line 21 of Schedule A (Form 1040). Senior taxes Statutory employees. Senior taxes    If you received a Form W-2 and the “Statutory employee” box in box 13 was checked, report your income and expenses related to that income on Schedule C (Form 1040) or Schedule C-EZ (Form 1040). Senior taxes Do not complete Form 2106 or 2106-EZ. Senior taxes   Statutory employees include full-time life insurance salespersons, certain agent or commission drivers, traveling salespersons, and certain homeworkers. Senior taxes If you are entitled to a reimbursement from your employer but you do not claim it, you cannot claim a deduction for the expenses to which that unclaimed reimbursement applies. Senior taxes Reimbursement for personal expenses. Senior taxes    If your employer reimburses you for nondeductible personal expenses, such as for vacation trips, your employer must report the reimbursement as wage income in box 1 of your Form W-2. Senior taxes You cannot deduct personal expenses. Senior taxes Income-producing property. Senior taxes   If you have travel or transportation expenses related to income-producing property, report your deductible expenses on the form appropriate for that activity. Senior taxes   For example, if you have rental real estate income and expenses, report your expenses on Schedule E (Form 1040), Supplemental Income and Loss. Senior taxes See Publication 527, Residential Rental Property, for more information on the rental of real estate. Senior taxes If you have deductible investment-related transportation expenses, report them on Schedule A (Form 1040), line 23. Senior taxes Vehicle Provided by Your Employer If your employer provides you with a car, you may be able to deduct the actual expenses of operating that car for business purposes. Senior taxes The amount you can deduct depends on the amount that your employer included in your income and the business and personal miles you drove during the year. Senior taxes You cannot use the standard mileage rate. Senior taxes Value reported on Form W-2. Senior taxes   Your employer can figure and report either the actual value of your personal use of the car or the value of the car as if you used it only for personal purposes (100% income inclusion). Senior taxes Your employer must separately state the amount if 100% of the annual lease value was included in your income. Senior taxes If you are unsure of the amount included on your Form W-2, ask your employer. Senior taxes Full value included in your income. Senior taxes   You can deduct the value of the business use of an employer-provided car if your employer reported 100% of the value of the car in your income. Senior taxes On your 2013 Form W-2, the amount of the value will be included in box 1, Wages, tips, other compensation, and box 14. Senior taxes    To claim your expenses, complete Form 2106, Part II, Sections A and C. Senior taxes Enter your actual expenses on line 23 of Section C and include the entire value of the employer-provided car on line 25. Senior taxes Complete the rest of the form. Senior taxes Less than full value included in your income. Senior taxes   If less than the full annual lease value of the car was included on your Form W-2, this means that your Form W-2 only includes the value of your personal use of the car. Senior taxes Do not enter this value on your Form 2106 because it is not deductible. Senior taxes   If you paid any actual costs (that your employer did not provide or reimburse you for) to operate the car, you can deduct the business portion of those costs. Senior taxes Examples of costs that you may have are gas, oil, and repairs. Senior taxes Complete Form 2106, Part II, Sections A and C. Senior taxes Enter your actual costs on line 23 of Section C and leave line 25 blank. Senior taxes Complete the rest of the form. Senior taxes Reimbursements This section explains what to do when you receive an advance or are reimbursed for any of the employee business expenses discussed in this publication. Senior taxes If you received an advance, allowance, or reimbursement for your expenses, how you report this amount and your expenses depends on whether your employer reimbursed you under an accountable plan or a nonaccountable plan. Senior taxes This section explains the two types of plans, how per diem and car allowances simplify proving the amount of your expenses, and the tax treatment of your reimbursements and expenses. Senior taxes It also covers rules for independent contractors. Senior taxes No reimbursement. Senior taxes   You are not reimbursed or given an allowance for your expenses if you are paid a salary or commission with the understanding that you will pay your own expenses. Senior taxes In this situation, you have no reimbursement or allowance arrangement, and you do not have to read this section on reimbursements. Senior taxes Instead, see Completing Forms 2106 and 2106-EZ , later, for information on completing your tax return. Senior taxes Reimbursement, allowance, or advance. Senior taxes   A reimbursement or other expense allowance arrangement is a system or plan that an employer uses to pay, substantiate, and recover the expenses, advances, reimbursements, and amounts charged to the employer for employee business expenses. Senior taxes Arrangements include per diem and car allowances. Senior taxes    A per diem allowance is a fixed amount of daily reimbursement your employer gives you for your lodging, meals, and incidental expenses when you are away from home on business. Senior taxes (The term “ incidental expenses ” is defined in chapter 1 under Standard Meal Allowance. Senior taxes ) A car allowance is an amount your employer gives you for the business use of your car. Senior taxes   Your employer should tell you what method of reimbursement is used and what records you must provide. Senior taxes Employers. Senior taxes   If you are an employer and you reimburse employee business expenses, how you treat this reimbursement on your employee's Form W-2 depends in part on whether you have an accountable plan. Senior taxes Reimbursements treated as paid under an accountable plan, as explained next, are not reported as pay. Senior taxes Reimbursements treated as paid under nonaccountable plans , as explained later, are reported as pay. Senior taxes See Publication 15 (Circular E), Employer's Tax Guide, for information on employee pay. Senior taxes Accountable Plans To be an accountable plan, your employer's reimbursement or allowance arrangement must include all of the following rules: Your expenses must have a business connection — that is, you must have paid or incurred deductible expenses while performing services as an employee of your employer. Senior taxes You must adequately account to your employer for these expenses within a reasonable period of time. Senior taxes You must return any excess reimbursement or allowance within a reasonable period of time. Senior taxes “ Adequate accounting ” and “ returning excess reimbursements ” are discussed later. Senior 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. Senior taxes Reasonable period of time. Senior taxes   The definition of reasonable period of time depends on the facts and circumstances of your situation. Senior taxes However, regardless of the facts and circumstances of your situation, actions that take place within the times specified in the following list will be treated as taking place within a reasonable period of time. Senior taxes You receive an advance within 30 days of the time you have an expense. Senior taxes You adequately account for your expenses within 60 days after they were paid or incurred. Senior taxes You return any excess reimbursement within 120 days after the expense was paid or incurred. Senior 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. Senior taxes Employee meets accountable plan rules. Senior taxes   If you meet the three rules for accountable plans, your employer should not include any reimbursements in your income in box 1 of your Form W-2. Senior taxes If your expenses equal your reimbursements, you do not complete Form 2106. Senior taxes You have no deduction since your expenses and reimbursement are equal. Senior taxes    If your employer included reimbursements in box 1 of your Form W-2 and you meet all the rules for accountable plans, ask your employer for a corrected Form W-2. Senior taxes Accountable plan rules not met. Senior taxes   Even though you are reimbursed under an accountable plan, some of your expenses may not meet all three rules. Senior taxes All reimbursements that fail to meet all three rules for accountable plans are generally treated as having been reimbursed under a nonaccountable plan (discussed later). Senior taxes Failure to return excess reimbursements. Senior taxes   If you are reimbursed under an accountable plan, but you fail to return, within a reasonable time, any amounts in excess of the substantiated amounts, the amounts paid in excess of the substantiated expenses are treated as paid under a nonaccountable plan. Senior taxes See Reasonable period of time , earlier, and Returning Excess Reimbursements , later. Senior taxes Reimbursement of nondeductible expenses. Senior taxes   You may be reimbursed under your employer's accountable plan for expenses related to that employer's business, some of which are deductible as employee business expenses and some of which are not deductible. Senior taxes The reimbursements you receive for the nondeductible expenses do not meet rule (1) for accountable plans, and they are treated as paid under a nonaccountable plan. Senior taxes Example. Senior taxes Your employer's plan reimburses you for travel expenses while away from home on business and also for meals when you work late at the office, even though you are not away from home. Senior taxes The part of the arrangement that reimburses you for the nondeductible meals when you work late at the office is treated as paid under a nonaccountable plan. Senior taxes The employer makes the decision whether to reimburse employees under an accountable plan or a nonaccountable plan. Senior taxes If you are an employee who receives payments under a nonaccountable plan, you cannot convert these amounts to payments under an accountable plan by voluntarily accounting to your employer for the expenses and voluntarily returning excess reimbursements to the employer. Senior taxes Adequate Accounting One of the rules for an accountable plan is that you must adequately account to your employer for your expenses. Senior taxes You adequately account by giving your employer a statement of expense, an account book, a diary, or a similar record in which you entered each expense at or near the time you had it, along with documentary evidence (such as receipts) of your travel, mileage, and other employee business expenses. Senior taxes (See Table 5-1 in chapter 5 for details you need to enter in your record and documents you need to prove certain expenses. Senior taxes ) A per diem or car allowance satisfies the adequate accounting requirement under certain conditions. Senior taxes See Per Diem and Car Allowances , later. Senior taxes You must account for all amounts you received from your employer during the year as advances, reimbursements, or allowances. Senior taxes This includes amounts you charged to your employer by credit card or other method. Senior taxes You must give your employer the same type of records and supporting information that you would have to give to the IRS if the IRS questioned a deduction on your return. Senior taxes You must pay back the amount of any reimbursement or other expense allowance for which you do not adequately account or that is more than the amount for which you accounted. Senior taxes Per Diem and Car Allowances If your employer reimburses you for your expenses using a per diem or a car allowance, you can generally use the allowance as proof for the amount of your expenses. Senior taxes A per diem or car allowance satisfies the adequate accounting requirements for the amount of your expenses only if all the following conditions apply. Senior taxes Your employer reasonably limits payments of your expenses to those that are ordinary and necessary in the conduct of the trade or business. Senior taxes The allowance is similar in form to and not more than the federal rate (defined later). Senior taxes You prove the time (dates), place, and business purpose of your expenses to your employer (as explained in Table 5-1 ) within a reasonable period of time. Senior taxes You are not related to your employer (as defined next). Senior taxes If you are related to your employer, you must be able to prove your expenses to the IRS even if you have already adequately accounted to your employer and returned any excess reimbursement. Senior taxes If the IRS finds that an employer's travel allowance practices are not based on reasonably accurate estimates of travel costs (including recognition of cost differences in different areas for per diem amounts), you will not be considered to have accounted to your employer. Senior taxes In this case, you must be able to prove your expenses to the IRS. Senior taxes Related to employer. Senior taxes   You are related to your employer if: Your employer is your brother or sister, half brother or half sister, spouse, ancestor, or lineal descendant, Your employer is a corporation in which you own, directly or indirectly, more than 10% in value of the outstanding stock, or Certain relationships (such as grantor, fiduciary, or beneficiary) exist between you, a trust, and your employer. Senior taxes You may be considered to indirectly own stock, for purposes of (2), if you have an interest in a corporation, partnership, estate, or trust that owns the stock or if a member of your family or your partner owns the stock. Senior taxes The federal rate. Senior taxes   The federal rate can be figured using any one of the following methods. Senior taxes For per diem amounts: The regular federal per diem rate. Senior taxes The standard meal allowance. Senior taxes The high-low rate. Senior taxes For car expenses: The standard mileage rate. Senior taxes A fixed and variable rate (FAVR). Senior taxes    For per diem amounts, use the rate in effect for the area where you stop for sleep or rest. Senior taxes Regular federal per diem rate. Senior taxes   The regular federal per diem rate is the highest amount that the federal government will pay to its employees for lodging, meals, and incidental expenses (or meals and incidental expenses only) while they are traveling away from home in a particular area. Senior taxes The rates are different for different locations. Senior taxes Your employer should have these rates available. Senior taxes You can also find federal per diem rates at www. Senior taxes gsa. Senior taxes gov/perdiem. Senior taxes The standard meal allowance. Senior taxes   The standard meal allowance (discussed in chapter 1) is the federal rate for meals and incidental expenses (M&IE). Senior taxes The rate for most small localities in the United States is $46 a day. Senior taxes Most major cities and many other localities qualify for higher rates. Senior taxes You can find this information on the Internet at www. Senior taxes gsa. Senior taxes gov/perdiem. Senior taxes   You receive an allowance only for meals and incidental expenses when your employer does one of the following. Senior taxes Provides you with lodging (furnishes it in kind). Senior taxes Reimburses you, based on your receipts, for the actual cost of your lodging. Senior taxes Pays the hotel, motel, etc. Senior taxes , directly for your lodging. Senior taxes Does not have a reasonable belief that you had (or will have) lodging expenses, such as when you stay with friends or relatives or sleep in the cab of your truck. Senior taxes Figures the allowance on a basis similar to that used in computing your compensation, such as number of hours worked or miles traveled. Senior taxes High-low rate. Senior taxes   This is a simplified method of computing the federal per diem rate for travel within the continental United States. Senior taxes It eliminates the need to keep a current list of the per diem rates for each city. Senior taxes   Under the high-low method, the per diem amount for travel during January through September of 2013 is $242 (including $65 for M&IE) for certain high-cost locations. Senior taxes All other areas have a per diem amount of $163 (including $52 for M&IE). Senior taxes For more information, see Notice 2012-63, which can be found on the Internet at www. Senior taxes irs. Senior taxes gov/irb/2012-42_IRB/ar12. Senior taxes html. Senior taxes    Effective October 1, 2013, the per diem rate for certain high-cost locations increased to $251 (including $65 for M&IE). Senior taxes The rate for all other locations increased to $170 (including $52 for M&IE). Senior taxes Employers who did not use the high-low method during the first 9 months of 2013 cannot begin to use it before 2014. Senior taxes For more information, see Notice 2013-65, which can be found on the Internet at www. Senior taxes irs. Senior taxes gov/pub/irs-drop/n-13–65. Senior taxes pdf and Revenue Procedure 2011-47 at www. Senior taxes irs. Senior taxes gov/irb/2011-42_IRB/ar12. Senior taxes html. Senior taxes Prorating the standard meal allowance on partial days of travel. Senior taxes   The standard meal allowance is for a full 24-hour day of travel. Senior taxes If you travel for part of a day, such as on the days you depart and return, you must prorate the full-day M&IE rate. Senior taxes This rule also applies if your employer uses the regular federal per diem rate or the high-low rate. Senior taxes   You can use either of the following methods to figure the federal M&IE for that day. Senior taxes Method 1: For the day you depart, add 3/4 of the standard meal allowance amount for that day. Senior taxes For the day you return, add 3/4 of the standard meal allowance amount for the preceding day. Senior taxes Method 2: Prorate the standard meal allowance using any method you consistently apply in accordance with reasonable business practice. Senior taxes For example, an employer can treat 2 full days of per diem (that includes M&IE) paid for travel away from home from 9 a. Senior taxes m. Senior taxes of one day to 5 p. Senior taxes m. Senior taxes of the next day as being no more than the federal rate. Senior taxes This is true even though a federal employee would be limited to a reimbursement of M&IE for only 1½ days of the federal M&IE rate. Senior taxes The standard mileage rate. Senior taxes   This is a set rate per mile that you can use to compute your deductible car expenses. Senior taxes For 2013, the standard mileage rate for the cost of operating your car for business use is 56½ cents per mile. Senior taxes Fixed and variable rate (FAVR). Senior taxes   This is an allowance your employer may use to reimburse your car expenses. Senior taxes Under this method, your employer pays an allowance that includes a combination of payments covering fixed and variable costs, such as a cents-per-mile rate to cover your variable operating costs (such as gas, oil, etc. Senior taxes ) plus a flat amount to cover your fixed costs (such as depreciation (or lease payments), insurance, etc. Senior taxes ). Senior taxes If your employer chooses to use this method, your employer will request the necessary records from you. Senior taxes Reporting your expenses with a per diem or car allowance. Senior taxes   If your reimbursement is in the form of an allowance received under an accountable plan, the following facts affect your reporting. Senior taxes The federal rate. Senior taxes Whether the allowance or your actual expenses were more than the federal rate. Senior taxes The following discussions explain where to report your expenses depending upon how the amount of your allowance compares to the federal rate. Senior taxes Allowance less than or equal to the federal rate. Senior taxes   If your allowance is less than or equal to the federal rate, the allowance will not be included in box 1 of your Form W-2. Senior taxes You do not need to report the related expenses or the allowance on your return if your expenses are equal to or less than the allowance. Senior taxes   However, if your actual expenses are more than your allowance, you can complete Form 2106 and deduct the excess amount on Schedule A (Form 1040). Senior taxes If you are using actual expenses, you must be able to prove to the IRS the total amount of your expenses and reimbursements for the entire year. Senior taxes If you are using the standard meal allowance or the standard mileage rate, you do not have to prove that amount. Senior taxes Example 1. Senior taxes In April, Jeremy takes a 2-day business trip to Denver. Senior taxes The federal rate for Denver is $215 per day. Senior taxes As required by his employer's accountable plan, he accounts for the time (dates), place, and business purpose of the trip. Senior taxes His employer reimburses him $215 a day ($430 total) for living expenses. Senior taxes Jeremy's living expenses in Denver are not more than $215 a day. Senior taxes Jeremy's employer does not include any of the reimbursement on his Form W-2 and Jeremy does not deduct the expenses on his return. Senior taxes Example 2. Senior taxes In June, Matt takes a 2-day business trip to Boston. Senior taxes Matt's employer uses the high-low method to reimburse employees. Senior taxes Since Boston is a high-cost area, Matt is given an advance of $242 a day ($484 total) for his lodging, meals, and incidental expenses. Senior taxes Matt's actual expenses totaled $700. Senior taxes Since Matt's $700 of expenses are more than his $484 advance, he includes the excess expenses when he itemizes his deductions. Senior taxes Matt completes Form 2106 (showing all of his expenses and reimbursements). Senior taxes He must also allocate his reimbursement between his meals and other expenses as discussed later under Completing Forms 2106 and 2106-EZ . Senior taxes Example 3. Senior taxes Nicole drives 10,000 miles in 2013 for business. Senior taxes Under her employer's accountable plan, she accounts for the time (dates), place, and business purpose of each trip. Senior taxes Her employer pays her a mileage allowance of 40 cents a mile. Senior taxes Since Nicole's $5,650 expense computed under the standard mileage rate (10,000 miles x 56½ cents) is more than her $4,000 reimbursement (10,000 miles × 40 cents), she itemizes her deductions to claim the excess expense. Senior taxes Nicole completes Form 2106 (showing all her expenses and reimbursements) and enters $1,650 ($5,650 − $4,000) as an itemized deduction. Senior taxes Allowance more than the federal rate. Senior taxes   If your allowance is more than the federal rate, your employer must include the allowance amount up to the federal rate in box 12 of your Form W-2. Senior taxes This amount is not taxable. Senior taxes However, the excess allowance will be included in box 1 of your Form W-2. Senior taxes You must report this part of your allowance as if it were wage income. Senior taxes   If your actual expenses are less than or equal to the federal rate, you do not complete Form 2106 or claim any of your expenses on your return. Senior taxes   However, if your actual expenses are more than the federal rate, you can complete Form 2106 and deduct those excess expenses. Senior taxes You must report on Form 2106 your reimbursements up to the federal rate (as shown in box 12 of your Form W-2) and all your expenses. Senior taxes You should be able to prove these amounts to the IRS. Senior taxes Example 1. Senior taxes Laura lives and works in Austin. Senior taxes In July her employer sent her to Albuquerque for 4 days on business. Senior taxes Laura's employer paid the hotel directly for her lodging and reimbursed Laura $65 a day ($260 total) for meals and incidental expenses. Senior taxes Laura's actual meal expenses were not more than the federal rate for Albuquerque, which is $56 per day. Senior taxes Table 6-1. Senior taxes Reporting Travel, Entertainment, Gift, and Car Expenses and Reimbursements IF the type of reimbursement (or  other expense allowance)  arrangement is under: THEN the employer reports on Form W-2: AND the employee reports on  Form 2106: * An accountable plan with: Actual expense reimbursement: Adequate accounting made and excess returned. Senior taxes No amount. Senior taxes No amount. Senior taxes Actual expense reimbursement: Adequate accounting and return of excess both required but excess not returned. Senior taxes The excess amount as wages in box 1. Senior taxes No amount. Senior taxes Per diem or mileage allowance up to the federal rate: Adequate accounting made and excess returned. Senior taxes No amount. Senior taxes All expenses and reimbursements only if excess expenses are claimed. Senior taxes Otherwise, form is not filed. Senior taxes Per diem or mileage allowance up to the federal rate: Adequate accounting and return of excess both required but excess not returned. Senior taxes The excess amount as wages in box 1. Senior taxes The amount up to the federal rate is reported only in box 12—it is not reported in box 1. Senior taxes No amount. Senior taxes Per diem or mileage allowance exceeds the federal rate: Adequate accounting up to the federal rate only and excess not returned. Senior taxes The excess amount as wages in box 1. Senior taxes The amount up to the federal rate is reported only in box 12—it is not reported in box 1. Senior taxes All expenses (and reimbursements reported on Form W-2, box 12) only if expenses in excess of the federal rate are claimed. Senior taxes Otherwise, form is not filed. Senior taxes A nonaccountable plan with: Either adequate accounting or return of excess, or both, not required by plan. Senior taxes The entire amount as wages in box 1. Senior taxes All expenses. Senior taxes No reimbursement plan: The entire amount as wages in box 1. Senior taxes All expenses. Senior taxes * You may be able to use Form 2106-EZ. Senior taxes See Completing Forms 2106 and 2106-EZ . Senior taxes Her employer included the $36 that was more than the federal rate (($65 − $56) × 4) in box 1 of Laura's Form W-2. Senior taxes Her employer shows $224 ($56 a day × 4) in box 12 of her Form W-2. Senior taxes This amount is not included in Laura's income. Senior taxes Laura does not have to complete Form 2106; however, she must include the $36 in her gross income as wages (by reporting the total amount shown in box 1 of her Form W-2). Senior taxes Example 2. Senior taxes Joe also lives in Austin and works for the same employer as Laura. Senior taxes In May the employer sent Joe to San Diego for 4 days and paid the hotel directly for Joe's hotel bill. Senior taxes The employer reimbursed Joe $75 a day for his meals and incidental expenses. Senior taxes The federal rate for San Diego is $71 a day. Senior taxes Joe can prove that his actual meal expenses totaled $380. Senior taxes His employer's accountable plan will not pay more than $75 a day for travel to San Diego, so Joe does not give his employer the records that prove that he actually spent $380. Senior taxes However, he does account for the time, place, and business purpose of the trip. Senior taxes This is Joe's only business trip this year. Senior taxes Joe was reimbursed $300 ($75 × 4 days), which is $16 more than the federal rate of $284 ($71 × 4 days). Senior taxes The employer includes the $16 as income on Joe's Form W-2 in box 1. Senior taxes The employer also enters $284 in box 12 of Joe's Form W-2. Senior taxes Joe completes Form 2106 to figure his deductible expenses. Senior taxes He enters the total of his actual expenses for the year ($380) on Form 2106. Senior taxes He also enters the reimbursements that were not included in his income ($284). Senior taxes His total deductible expense, before the 50% limit, is $96. Senior taxes After he figures the 50% limit on his unreimbursed meals and entertainment, he will include the balance, $48, as an itemized deduction. Senior taxes Example 3. Senior taxes Debbie drives 10,000 miles in 2013 for business. Senior taxes Under her employer's accountable plan, she gets reimbursed 60 cents a mile, which is more than the standard mileage rate. Senior taxes Her total reimbursement is $6,000. Senior taxes Debbie's employer must include the reimbursement amount up to the standard mileage rate, $5,650 (10,000 × 56½ cents), in box 12 of her Form W-2. Senior taxes That amount is not taxable. Senior taxes Her employer must also include $350 ($6,000 − $5,650) in box 1 of her Form W-2. Senior taxes This is the reimbursement that is more than the standard mileage rate. Senior taxes If Debbie's expenses are equal to or less than the standard mileage rate, she would not complete Form 2106. Senior taxes If her expenses are more than the standard mileage rate, she would complete Form 2106 and report her total expenses and reimbursement (shown in box 12 of her Form W-2). Senior taxes She would then claim the excess expenses as an itemized deduction. Senior taxes Returning Excess Reimbursements Under an accountable plan, you are required to return any excess reimbursement or other expense allowances for your business expenses to the person paying the reimbursement or allowance. Senior taxes Excess reimbursement means any amount for which you did not adequately account within a reasonable period of time. Senior taxes For example, if you received a travel advance and you did not spend all the money on business-related expenses or you do not have proof of all your expenses, you have an excess reimbursement. Senior taxes “ Adequate accounting ” and “ reasonable period of time ” were discussed earlier in this chapter. Senior taxes Travel advance. Senior taxes   You receive a travel advance if your employer provides you with an expense allowance before you actually have the expense, and the allowance is reasonably expected to be no more than your expense. Senior taxes Under an accountable plan, you are required to adequately account to your employer for this advance and to return any excess within a reasonable period of time. Senior taxes   If you do not adequately account for or do not return any excess advance within a reasonable period of time, the amount you do not account for or return will be treated as having been paid under a nonaccountable plan (discussed later). Senior taxes Unproved amounts. Senior taxes   If you do not prove that you actually traveled on each day for which you received a per diem or car allowance (proving the elements described in Table 5-1 ), you must return this unproved amount of the travel advance within a reasonable period of time. Senior taxes If you do not do this, the unproved amount will be considered paid under a nonaccountable plan (discussed later). Senior taxes Per diem allowance more than federal rate. Senior taxes   If your employer's accountable plan pays you an allowance that is higher than the federal rate, you do not have to return the difference between the two rates for the period you can prove business-related travel expenses. Senior taxes However, the difference will be reported as wages on your Form W-2. Senior taxes This excess amount is considered paid under a nonaccountable plan (discussed later). Senior taxes Example. Senior taxes Your employer sends you on a 5-day business trip to Phoenix in March 2013 and gives you a $400 ($80 × 5 days) advance to cover your meals and incidental expenses. Senior taxes The federal per diem for meals and incidental expenses for Phoenix is $71. Senior taxes Your trip lasts only 3 days. Senior taxes Under your employer's accountable plan, you must return the $160 ($80 × 2 days) advance for the 2 days you did not travel. Senior taxes For the 3 days you did travel you do not have to return the $27 difference between the allowance you received and the federal rate for Phoenix (($80 − $71) × 3 days). Senior taxes However, the $27 will be reported on your Form W-2 as wages. Senior taxes Nonaccountable Plans A nonaccountable plan is a reimbursement or expense allowance arrangement that does not meet one or more of the three rules listed earlier under Accountable Plans. Senior taxes In addition, even if your employer has an accountable plan, the following payments will be treated as being paid under a nonaccountable plan: Excess reimbursements you fail to return to your employer, and Reimbursement of nondeductible expenses related to your employer's business. Senior taxes See Reimbursement of nondeductible expenses , earlier, under Accountable Plans. Senior taxes An arrangement that repays you for business expenses by reducing the amount reported as your wages, salary, or other pay will be treated as a nonaccountable plan. Senior taxes This is because you are entitled to receive the full amount of your pay whether or not you have any business expenses. Senior taxes If you are not sure if the reimbursement or expense allowance arrangement is an accountable or nonaccountable plan, ask your employer. Senior taxes Reporting your expenses under a nonaccountable plan. Senior taxes   Your employer will combine the amount of any reimbursement or other expense allowance paid to you under a nonaccountable plan with your wages, salary, or other pay. Senior taxes Your employer will report the total in box 1 of your Form W-2. Senior taxes    You must complete Form 2106 or 2106-EZ and itemize your deductions to deduct your expenses for travel, transportation, meals, or entertainment. Senior taxes Your meal and entertainment expenses will be subject to the 50% limit discussed in chapter 2. Senior taxes Also, your total expenses will be subject to the 2%-of-adjusted-gross-income limit that applies to most miscellaneous itemized deductions. Senior taxes Example 1. Senior taxes Kim's employer gives her $1,000 a month ($12,000 total for the year) for her business expenses. Senior taxes Kim does not have to provide any proof of her expenses to her employer, and Kim can keep any funds that she does not spend. Senior taxes Kim is being reimbursed under a nonaccountable plan. Senior taxes Her employer will include the $12,000 on Kim's Form W-2 as if it were wages. Senior taxes If Kim wants to deduct her business expenses, she must complete Form 2106 or 2106-EZ and itemize her deductions. Senior taxes Example 2. Senior taxes Kevin is paid $2,000 a month by his employer. Senior taxes On days that he travels away from home on business, his employer designates $50 a day of his salary as paid to reimburse his travel expenses. Senior taxes Because his employer would pay Kevin his monthly salary whether or not he was traveling away from home, the arrangement is a nonaccountable plan. Senior taxes No part of the $50 a day designated by his employer is treated as paid under an accountable plan. Senior taxes Rules for Independent Contractors and Clients This section provides rules for independent contractors who incur expenses on behalf of a client or customer. Senior taxes The rules cover the reporting and substantiation of certain expenses discussed in this publication, and they affect both independent contractors and their clients or customers. Senior taxes You are considered an independent contractor if you are self-employed and you perform services for a customer or client. Senior taxes Accounting to Your Client If you received a reimbursement or an allowance for travel, entertainment, or gift expenses that you incurred on behalf of a client, you should provide an adequate accounting of these expenses to your client. Senior taxes If you do not account to your client for these expenses, you must include any reimbursements or allowances in income. Senior taxes You must keep adequate records of these expenses whether or not you account to your client for these expenses. Senior taxes If you do not separately account for and seek reimbursement for meals and entertainment in connection with providing services for a client, you are subject to the 50% limit on those expenses. Senior taxes See 50% Limit in chapter 2. Senior taxes Adequate accounting. Senior taxes   As a self-employed person, you adequately account by reporting your actual expenses. Senior taxes You should follow the recordkeeping rules in chapter 5 . Senior taxes How to report. Senior taxes   For information on how to report expenses on your tax return, see Self-employed at the beginning of this chapter. Senior taxes Required Records for Clients or Customers If you are a client or customer, you generally do not have to keep records to prove the reimbursements or allowances you give, in the course of your business, to an independent contractor for travel or gift expenses incurred on your behalf. Senior taxes However, you must keep records if: You reimburse the contractor for entertainment expenses incurred on your behalf, and The contractor adequately accounts to you for these expenses. Senior taxes Contractor adequately accounts. Senior taxes   If the contractor adequately accounts to you for entertainment expenses, you (the client or customer) must keep records documenting each element of the expense, as explained in chapter 5 . Senior taxes Use your records as proof for a deduction on your tax return. Senior taxes If entertainment expenses are accounted for separately, you are subject to the 50% limit on entertainment. Senior taxes If the contractor adequately accounts to you for reimbursed amounts, you do not have to report the amounts on an information return. Senior taxes Contractor does not adequately account. Senior taxes    If the contractor does not adequately account to you for allowances or reimbursements of entertainment expenses, you do not have to keep records of these items. Senior taxes You are not subject to the 50% limit on entertainment in this case. Senior taxes You can deduct the reimbursements or allowances as payment for services if they are ordinary and necessary business expenses. Senior taxes However, you must file Form 1099-MISC to report amounts paid to the independent contractor if the total of the reimbursements and any other fees is $600 or more during the calendar year. Senior taxes How To Use Per Diem Rate Tables This section contains information about the per diem rate substantiation methods available and the choice of rates you must make for the last 3 months of the year. Senior taxes The Two Substantiation Methods High-low method. Senior taxes   IRS notices list the localities that are treated under the high-low substantiation method as high-cost localities for all or part of the year. Senior taxes Notice 2012–63, available at www. Senior taxes irs. Senior taxes gov/irb/2012–42_IRB/ar12. Senior taxes html, lists the localities that are eligible for $242 ($65 meals and incidental expenses (M&IE)) per diem, effective October 1, 2012. Senior taxes For travel on or after October 1, 2012, all other localities within CONUS are eligible for $163 ($52 M&IE) per diem under the high-low method. Senior taxes   Notice 2013–65, available at www. Senior taxes irs. Senior taxes gov/pub/irs-drop/n-13–65. Senior taxes pdf, lists the localities that are eligible for $251 ($65 M&IE) per diem, effective October 1, 2013. Senior taxes For travel on or after October 1, 2013, the per diem for all other localities increased to $170 ($52 M&IE). Senior taxes Regular federal per diem rate method. Senior taxes   Regular federal per diem rates are published by the General Services Administration (GSA). Senior taxes Both tables include the separate rate for meals and incidental expenses (M&IE) for each locality. Senior taxes The rates listed for FY2013 at www. Senior taxes gsa. Senior taxes gov/perdiem are effective October 1, 2012 and those listed for FY2014 are effective October 1, 2013. Senior taxes The standard rate for all locations within CONUS not specifically listed for FY2013 is $123 ($77 for lodging and $46 for M&IE). Senior taxes For FY2014, this rate increased to $129 ($83 for lodging and $46 for M&IE). Senior taxes Transition Rules The transition period covers the last 3 months of the calendar year, from the time that new rates are effective (generally October 1) through December 31. Senior taxes During this period, you generally may change to the new rates or finish out the year with the rates you had been using. Senior taxes High-low method. Senior taxes   If you use the high-low substantiation method, when new rates become effective (generally October 1) you can either continue with the rates you used for the first part of the year or change to the new rates. Senior taxes However, you must continue using the high-low method for the rest of the calendar year (through December 31). Senior taxes If you are an employer, you must use the same rates for all employees reimbursed under the high-low method during that calendar year. Senior taxes   The new rates and localities for the high-low method are included each year in a notice that is generally published in mid-to-late-September. Senior taxes You can find the notice in the weekly Internal Revenue Bulletin (IRB) on the Internet at www. Senior taxes irs. Senior taxes gov/irb. Senior taxes Federal per diem rate method. Senior taxes   New CONUS per diem rates become effective on October 1 of each year and remain in effect through September 30 of the following year. Senior taxes Employees being reimbursed under the per diem rate method during the first 9 months of a year (January 1–September 30) must continue under the same method through the end of that calendar year (December 31). Senior taxes However, for travel by these employees from October 1 through December 31, you can choose to continue using the same per diem rates or use the new rates. Senior taxes   The new federal CONUS per diem rates are published each year, generally early in September, on the Internet. Senior taxes Go to www. Senior taxes gsa. Senior taxes gov/perdiem. Senior taxes Per diem rates for localities listed for FY2014 may change at any time. Senior taxes To be sure you have the most current rate, check www. Senior taxes gsa. Senior taxes gov/perdiem. Senior taxes Completing Forms 2106 and 2106-EZ This section briefly describes how employees complete Forms 2106 and 2106-EZ. Senior taxes Table 6-1 explains what the employer reports on Form W-2 and what the employee reports on Form 2106. Senior taxes The instructions for the forms have more information on completing them. Senior taxes If you are self-employed, do not file Form 2106 or 2106-EZ. Senior taxes Report your expenses on Schedule C (Form 1040), Schedule C-EZ (Form 1040), or Schedule F (Form 1040). Senior taxes See the instructions for the form that you must file. Senior taxes Form 2106-EZ. Senior taxes   You may be able to use the shorter Form 2106-EZ to claim your employee business expenses. Senior taxes You can use this form if you meet all the following conditions. Senior taxes You are an employee deducting ordinary and necessary expenses attributable to your job. Senior taxes You were not reimbursed by your employer for your expenses (amounts included in box 1 of your Form W-2 are not considered reimbursements). Senior taxes If you are claiming car expenses, you are using the standard mileage rate. Senior taxes Car expenses. Senior taxes   If you used a car to perform your job as an employee, you may be able to deduct certain car expenses. Senior taxes These are generally figured on Form 2106, Part II, and then claimed on Form 2106, Part I, line 1, Column A. Senior taxes Car expenses using the standard mileage rate can also be figured on Form 2106-EZ by completing Part II and Part I, line 1. Senior taxes Information on use of cars. Senior taxes   If you claim any deduction for the business use of a car, you must answer certain questions and provide information about the use of the car. Senior taxes The information relates to the following items. Senior taxes Date placed in service. Senior taxes Mileage (total, business, commuting, and other personal mileage). Senior taxes Percentage of business use. Senior taxes After-work use. Senior taxes Use of other vehicles. Senior taxes Whether you have evidence to support the deduction. Senior taxes Whether or not the evidence is written. Senior taxes Employees must complete Form 2106, Part II, Section A, or Form 2106-EZ, Part II, to provide this information. Senior taxes Standard mileage rate. Senior taxes   If you claim a deduction based on the standard mileage rate instead of your actual expenses, you must complete Form 2106, Part II, Section B. Senior taxes The amount on line 22 (Section B) is carried to Form 2106, Part I, line 1. Senior taxes In addition, on Part 1, line 2, you can deduct parking fees and tolls that apply to the business use of the car. Senior taxes If you file Form 2106-EZ, complete Part I, line 1, for the standard mileage rate and line 2 for parking fees and tolls. Senior taxes See Standard Mileage Rate in chapter 4 for information on using this rate. Senior taxes Actual expenses. Senior taxes   If you claim a deduction based on actual car expenses, you cannot use Form 2106-EZ. Senior taxes You must complete Form 2106, Part II, Section C. Senior taxes In addition, unless you lease your car, you must complete Section D to show your depreciation deduction and any section 179 deduction you claim. Senior taxes   If you are still using a car that is fully depreciated, continue to complete Section C. Senior taxes Since you have no depreciation deduction, enter zero on line 28. Senior taxes In this case, do not complete Section D. Senior taxes Car rentals. Senior taxes   If you claim car rental expenses on Form 2106, line 24a, you may have to reduce that expense by an inclusion amount as described in chapter 4. Senior taxes If so, you can show your car expenses and any inclusion amount as follows. Senior taxes Compute the inclusion amount without taking into account your business use percentage for the tax year. Senior taxes Report the inclusion amount from (1) on Form 2106, Part II, line 24b. Senior taxes Report on line 24c the net amount of car rental expenses (total car rental expenses minus the inclusion amount computed in (1)). Senior taxes The net amount of car rental expenses will be adjusted on Form 2106, Part II, line 27, to reflect the percentage of business use for the tax year. Senior taxes Transportation expenses. Senior taxes   Show your transportation expenses that did not involve overnight travel on Form 2106, line 2, Column A, or on Form 2106-EZ, Part I, line 2. Senior taxes Also include on this line business expenses you have for parking fees and tolls. Senior taxes Do not include expenses of operating your car or expenses of commuting between your home and work. Senior taxes Employee business expenses other than meals and entertainment. Senior taxes   Show your other employee business expenses on Form 2106, lines 3 and 4, Column A, or Form 2106-EZ, lines 3 and 4. Senior taxes Do not include expenses for meals and entertainment on those lines. Senior taxes Line 4 is for expenses such as gifts, educational expenses (tuition and books), office-in-the-home expenses, and trade and professional publications. Senior taxes    If line 4 expenses are the only ones you are claiming, you received no reimbursements (or the reimbursements were all included in box 1 of your Form W-2), and the Special Rules discussed later do not apply to you, do not complete Form 2106 or 2106-EZ. Senior taxes Claim these amounts directly on Schedule A (Form 1040), line 21. Senior taxes List the type and amount of each expense on the dotted lines and include the total on line 21. Senior taxes Meal and entertainment expenses. Senior taxes   Show the full amount of your expenses for business-related meals and entertainment on Form 2106, line 5, Column B. Senior taxes Include meals while away from your tax home overnight and other business meals and entertainment. Senior taxes Enter 50% of the line 8, Column B, meal and entertainment expenses on line 9, Column B. Senior taxes   If you file Form 2106-EZ, enter the full amount of your meals and entertainment on the line to the left of line 5 and multiply the total by 50%. Senior taxes Enter the result on line 5. Senior taxes Hours of service limits. Senior taxes   If you are subject to the Department of Transportation's “hours of service” limits (as explained earlier under Individuals subject to “hours of service” limits in chapter 2), use 80% instead of 50% for meals while away from your tax home. Senior taxes Reimbursements. Senior taxes   Enter on Form 2106, line 7 (you cannot use Form 2106-EZ) the amounts your employer (or third party) reimbursed you that were not reported to you in box 1 of your Form W-2. Senior taxes This includes any amount reported under code L in box 12 of Form W-2. Senior taxes Allocating your reimbursement. Senior taxes   If you were reimbursed under an accountable plan and want to deduct excess expenses that were not reimbursed, you may have to allocate your reimbursement. Senior taxes This is necessary when your employer pays your reimbursement in the following manner: Pays you a single amount that covers meals and/or entertainment, as well as other business expenses, and Does not clearly identify how much is for deductible meals and/or entertainment. Senior taxes You must allocate that single payment so that you know how much to enter on Form 2106, line 7, Column A and Column B. Senior taxes Example. Senior taxes Rob's employer paid him an expense allowance of $12,000 this year under an accountable plan. Senior taxes The $12,000 payment consisted of $5,000 for airfare and $7,000 for meals, entertainment, and car expenses. Senior taxes The employer did not clearly show how much of the $7,000 was for the cost of deductible meals and entertainment. Senior taxes Rob actually spent $14,000 during the year ($5,500 for airfare, $4,500 for meals and entertainment, and $4,000 for car expenses). Senior taxes Since the airfare allowance was clearly identified, Rob knows that $5,000 of the payment goes in Column A, line 7, of Form 2106. Senior taxes To allocate the remaining $7,000, Rob uses the worksheet from the Instructions for Form 2106. Senior taxes His completed worksheet follows. Senior taxes Reimbursement Allocation Worksheet (Keep for your records)   1. Senior taxes Enter the total amount of reimbursements your employer gave you that were not reported to you in box 1 of Form W-2 $7,000   2. Senior taxes Enter the total amount of your expenses for the periods covered by this reimbursement 8,500   3. Senior taxes Of the amount on line 2, enter your total expense for meals and entertainment 4,500   4. Senior taxes Divide line 3 by line 2. Senior taxes Enter the result as a decimal (rounded to at least three places) . Senior taxes 529   5. Senior taxes Multiply line 1 by line 4. Senior taxes Enter the result here and in Column B, line 7 3,703   6. Senior taxes Subtract line 5 from line 1. Senior taxes Enter the result here and in Column A, line 7 $3,297 On line 7 of Form 2106, Rob enters $8,297 ($5,000 airfare and $3,297 of the $7,000) in Column A and $3,703 (of the $7,000) in Column B. Senior taxes After you complete the form. Senior taxes   After you have completed your Form 2106 or 2106-EZ, follow the directions on that form to deduct your expenses on the appropriate line of your tax return. Senior taxes For most taxpayers, this is line 21 of Schedule A (Form 1040). Senior taxes However, if you are a government official paid on a fee basis, a performing artist, an Armed Forces reservist, or a disabled employee with impairment-related work expenses, see Special Rules , later. Senior taxes Limits on employee business expenses. Senior taxes   Your employee business expenses may be subject to either of the limits described next. Senior taxes They are figured in the following order on the specified form. Senior taxes 1. Senior taxes Limit on meals and entertainment. Senior taxes   Certain meal and entertainment expenses are subject to a 50% limit. Senior taxes If you are an employee, you figure this limit on line 9 of Form 2106 or line 5 of Form 2106-EZ. Senior taxes (See 50% Limit in chapter 2. Senior taxes ) 2. Senior taxes Limit on miscellaneous itemized deductions. Senior taxes   If you are an employee, deduct your employee business expenses (as figured on Form 2106 or 2106-EZ) on line 21 of Schedule A (Form 1040). Senior taxes Most miscellaneous itemized deductions, including employee business expenses, are subject to a 2%-of-adjusted-gross-income limit. Senior taxes This limit is figured on line 26 of Schedule A (Form 1040). Senior taxes 3. Senior taxes Limit on total itemized deductions. Senior taxes   If your adjusted gross income (line 38 of Form 1040) is more than $300,000 ($150,000 if you are married filing separately), the total of certain itemized deductions, including employee business expenses, may be limited. Senior taxes See your form instructions for information on how to figure this limit. Senior taxes Special Rules This section discusses special rules that apply only to Armed Forces reservists, government officials who are paid on a fee basis, performing artists, and disabled employees with impairment-related work expenses. Senior taxes Armed Forces Reservists Traveling More Than 100 Miles From Home If you are a member of a reserve component of the Armed Forces of the United States and you travel more than 100 miles away from home in connection with your performance of services as a member of the reserves, you can deduct your travel expenses as an adjustment to gross income rather than as a miscellaneous itemized deduction. Senior taxes The amount of expenses you can deduct as an adjustment to gross income is limited to the regular federal per diem rate (for lodging, meals, and incidental expenses) and the standard mileage rate (for car expenses) plus any parking fees, ferry fees, and tolls. Senior taxes See Per Diem and Car Allowances , earlier, for more information. Senior taxes Any expenses in excess of these amounts can be claimed only as a miscellaneous itemized deduction subject to the 2% limit. Senior taxes Member of a reserve component. Senior taxes   You are a member of a reserve component of the Armed Forces of the United States if you are in the Army, Navy, Marine Corps, Air Force, or Coast Guard Reserve; the Army National Guard of the United States; the Air National Guard of the United States; or the Reserve Corps of the Public Health Service. Senior taxes How to report. Senior taxes   If you have reserve-related travel that takes you more than 100 miles from home, you should first complete Form 2106 or Form 2106-EZ. Senior taxes Then include your expenses for reserve travel over 100 miles from home, up to the federal rate, from Form 2106, line 10, or Form 2106-EZ, line 6, in the total on Form 1040, line 24. Senior taxes Subtract this amount from the total on Form 2106, line 10, or Form 2106-EZ, line 6, and deduct the balance as an itemized deduction on Schedule A (Form 1040), line 21. Senior taxes   You cannot deduct expenses of travel that does not take you more than 100 miles from home as an adjustment to gross income. Senior taxes Instead, you must complete Form 2106 or 2106-EZ and deduct those expenses as an itemized deduction on Schedule A (Form 1040), line 21. Senior taxes Officials Paid on a Fee Basis Certain fee-basis officials can claim their employee business expenses whether or not they itemize their other deductions on Schedule A (Form 1040). Senior taxes Fee-basis officials are persons who are employed by a state or local government and who are paid in whole or in part on a fee basis. Senior taxes They can deduct their business expenses in performing services in that job as an adjustment to gross income rather than as a miscellaneous itemized deduction. Senior taxes If you are a fee-basis official, include your employee business expenses from Form 2106, line 10, or Form 2106-EZ, line 6, in the total on Form 1040, line 24. Senior taxes Expenses of Certain Performing Artists If you are a performing artist, you may qualify to deduct your employee business expenses as an adjustment to gross income rather than as a miscellaneous itemized deduction. Senior taxes To qualify, you must meet all of the following requirements. Senior taxes During the tax year, you perform services in the performing arts as an employee for at least two employers. Senior taxes You receive at least $200 each from any two of these employers. Senior taxes Your related performing-arts business expenses are more than 10% of your gross income from the performance of those services. Senior taxes Your adjusted gross income is not more than $16,000 before deducting these business expenses. Senior taxes Special rules for married persons. Senior taxes   If you are married, you must file a joint return unless you lived apart from your spouse at all times during the tax year. Senior taxes If you file a joint return, you must figure requirements (1), (2), and (3) separately for both you and your spouse. Senior taxes However, requirement (4) applies to your and your spouse's combined adjusted gross income. Senior taxes Where to report. Senior taxes   If you meet all of the above requirements, you should first complete Form 2106 or 2106-EZ. Senior taxes Then you include your performing-arts-related expenses from Form 2106, line 10, or Form 2106-EZ, line 6, in the total on Form 1040, line 24. Senior taxes   If you do not meet all of the above requirements, you do not qualify to deduct your expenses as an adjustment to gross income. Senior taxes Instead, you must complete Form 2106 or 2106-EZ and deduct your employee business expenses as an itemized deduction on Schedule A (Form 1040), line 21. Senior taxes Impairment-Related Work Expenses of Disabled Employees If you are an employee with a physical or mental disability, your impairment-related work expenses are not subject to the 2%-of-adjusted-gross-income limit that applies to most other employee business expenses. Senior taxes After you complete Form 2106 or 2106-EZ, enter your impairment-related work expenses from Form 2106, line 10, or Form 2106-EZ, line 6, on Schedule A (Form 1040), line 28, and identify the type and amount of this expense on the dotted line next to line 28. Senior taxes Enter your employee business expenses that are unrelated to your disability from Form 2106, line 10, or Form 2106-EZ, line 6, on Schedule A (Form 1040), line 21. Senior taxes Impairment-related work expenses are your allowable expenses for attendant care at your workplace and other expenses in connection with your workplace that are necessary for you to be able to work. Senior taxes You are disabled if you have: A physical or mental disability (for example, blindness or deafness) that functionally limits your being employed, or A physical or mental impairment (for example, a sight or hearing impairment) that substantially limits one or more of your major life activities, such as performing manual tasks, walking, speaking, breathing, learning, or working. Senior taxes You can deduct impairment-related expenses as business expenses if they are: Necessary for you to do your work satisfactorily, For goods and services not required or used, other than incidentally, in your personal activities, and Not specifically covered under other income tax laws. Senior taxes Example 1. Senior taxes You are blind. Senior taxes You must use a reader to do your work. Senior taxes You use the reader both during your regular working hours at your place of work and outside your regular working hours away from your place of work. Senior taxes The reader's services are only for your work. Senior taxes You can deduct your expenses for the reader as business expenses. Senior taxes Example 2. Senior taxes You are deaf. Senior taxes You must use a sign language interpreter during meetings while you are at work. Senior taxes The interpreter's services are used only for your work. Senior taxes You can deduct your expenses for the interpreter as business expenses. Senior taxes Prev  Up  Next   Home   More Online Publications
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U.S. Central Command (CENTCOM)

Located between the European and Pacific combatant commands, U.S. Central Command’s area of responsibility covers the "central" area of the globe and consists of 20 countries — Afghanistan, Bahrain, Egypt, Iran, Iraq, Jordan, Kazakhstan, Kuwait, Kyrgyzstan, Lebanon, Oman, Pakistan, Qatar, Saudi Arabia, Syria, Tajikistan, Turkmenistan, United Arab Emirates, Uzbekistan, and Yemen.

Contact the Agency or Department

Website: U.S. Central Command (CENTCOM)

Address: 7115 South Boundary Boulevard
MacDill Air Force Base, FL 33621-5101

Phone Number: (813) 828-1110

The Senior Taxes

Senior taxes Publication 970 - Introductory Material Table of Contents Future Developments What's New Reminders IntroductionComparison table. Senior taxes Ordering forms and publications. Senior taxes Tax questions. Senior taxes Useful Items - You may want to see: Future Developments For the latest information about developments related to Publication 970, such as legislation enacted after it was published, go to www. Senior taxes irs. Senior taxes gov/pub970. Senior taxes What's New Lifetime learning credit. Senior taxes  For 2013, the amount of your lifetime learning credit is gradually reduced (phased out) if your modified adjusted gross income (MAGI) is between $53,000 and $63,000 ($107,000 and $127,000 if you file a joint return). Senior taxes You cannot claim a credit if your MAGI is $63,000 or more ($127,000 or more if you file a joint return). Senior taxes This is an increase from the 2012 limits of $52,000 and $62,000 ($104,000 and $124,000 if filing a joint return). Senior taxes For more information, see chapter 3, Lifetime Learning Credit . Senior taxes Business deduction for work-related education. Senior taxes  For 2013, if you drive your car to and from school and qualify to deduct transportation expenses, the amount you can deduct for miles driven from January 1, 2013 through December 31, 2013 is 56. Senior taxes 5 cents per mile. Senior taxes See chapter 12, Business Deduction for Work-Related Education , for more information. Senior taxes Reminders Form 1098-T, Tuition Statement. Senior taxes  When figuring an education credit or the tuition and fees deduction, use only the amounts you paid and are deemed to have paid during the tax year for qualified education expenses. Senior taxes In most cases, the student should receive Form 1098-T from the eligible educational institution by January 31, 2014. Senior taxes An institution my choose to report either payments received during calendar year 2013 (box 1), or amounts billed during the calendar year 2013 (box 2), for qualified education expenses. Senior taxes However, the amounts in boxes 1 and 2 of Form 1098-T might be different than the amount you actually paid and are deemed to have paid. Senior taxes In addition, the Form 1098-T should give you other information for that institution, such as adjustments made for prior years, the amount of scholarships or grants, reimbursements, or refunds, and whether the student was enrolled at least half-time or was a graduate student. Senior taxes The eligible educational institution may ask for a completed Form W-9S, Request for Student's or Borrower's Taxpayer Identification Number and Certification, or similar statement to obtain the student's name, address, and taxpayer identification number. Senior taxes Hope Scholarship Credit. Senior taxes  For 2013, the Hope Scholarship Credit is not available. Senior taxes However, you may be able to claim an American opportunity or lifetime learning credit. Senior taxes See chapter 2, American Opportunity Credit , and chapter 3, Lifetime Learning Credit , for more information. Senior taxes Estimated tax payments. Senior taxes  If you have taxable income from any of your education benefits and the payer does not withhold enough income tax, you may need to make estimated tax payments. Senior taxes For more information, see Publication 505, Tax Withholding and Estimated Tax. Senior taxes Photographs of missing children. Senior taxes  The Internal Revenue Service is a proud partner with the National Center for Missing and Exploited Children. Senior taxes Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. Senior taxes You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child. Senior taxes Introduction This publication explains tax benefits that may be available to you if you are saving for or paying education costs for yourself or, in many cases, another student who is a member of your immediate family. Senior taxes Most benefits apply only to higher education. Senior taxes What is in this publication. Senior taxes    Chapter 1, Scholarships, Fellowships, Grants, and Tuition Reductions , explains the tax treatment of various types of educational assistance, including scholarships, fellowships, and tuition reductions. Senior taxes   Two tax credits for which you may be eligible are explained in chapter 2, American Opportunity Credit , and chapter 3, Lifetime Learning Credit . Senior taxes These benefits, which reduce the amount of income tax you may have to pay, are: The American opportunity credit, and The lifetime learning credit. Senior taxes    Ten other types of benefits are explained in chapters 4 through 12. Senior taxes These benefits, which reduce the amount of income tax you may have to pay, are: Deduct student loan interest; Receive tax-free treatment of a canceled student loan; Receive tax-free student loan repayment assistance; Deduct tuition and fees for education; Establish and contribute to a Coverdell education savings account (ESA), which features tax-free earnings; Participate in a qualified tuition program (QTP), which features tax-free earnings; Take early distributions from any type of individual retirement arrangement (IRA) for education costs without paying the 10% additional tax on early distributions; Cash in savings bonds for education costs without having to pay tax on the interest; Receive tax-free educational benefits from your employer; and Take a business deduction for work-related education. Senior taxes Note. Senior taxes You generally cannot claim more than one of the benefits described in the list above for the same qualifying education expense. Senior taxes Comparison table. Senior taxes   Some of the features of these benefits are highlighted in Appendix B, Highlights of Education Tax Benefits for Tax Year 2013 , later, in this publication. Senior taxes This general comparison table may guide you in determining which benefits you may be eligible for and which chapters you may want to read. Senior taxes When you figure your taxes, you may want to compare these tax benefits so you can choose the method(s) that gives you the lowest tax liability. Senior taxes If you qualify, you may find that a combination of credit(s) and deduction(s) gives you the lowest tax. Senior taxes Analyzing your tax withholding. Senior taxes   After you estimate your education tax benefits for the year, you may be able to reduce the amount of your federal income tax withholding. Senior taxes Also, you may want to recheck your withholding during the year if your personal or financial situation changes. Senior taxes See Publication 919, How Do I Adjust My Tax Withholding, for more information. Senior taxes Glossary. Senior taxes   In this publication, wherever appropriate, we have tried to use the same or similar terminology when referring to the basic components of each education benefit. Senior taxes Some of the terms used are: Qualified education expenses, Eligible educational institution, and Modified adjusted gross income. Senior taxes   Even though the same term, such as qualified education expenses, is used to label a basic component of many of the education benefits, the same expenses are not necessarily allowed for each benefit. Senior taxes For example, the cost of room and board is a qualified education expense for the qualified tuition program, but not for the education savings bond program. Senior taxes   Many of the terms used in the publication are defined in the glossary near the end of the publication. Senior taxes The glossary is not intended to be a substitute for reading the chapter on a particular education benefit, but it will give you an overview of how certain terms are used in discussing the different benefits. Senior taxes Comments and suggestions. Senior taxes   We welcome your comments about this publication and your suggestions for future editions. Senior taxes   You can write to us at the following address: Internal Revenue Service Tax Forms and Publications Division 1111 Constitution Ave. Senior taxes NW, IR-6526 Washington, DC 20224   We respond to many letters by telephone. Senior taxes Therefore, it would be helpful if you would include your daytime phone number, including the area code, in your correspondence. Senior taxes   You can send your comments from www. Senior taxes irs. Senior taxes gov/formspubs/. Senior taxes Click on “More Information” and then on “Comment on Tax Forms and Publications”. Senior taxes   Although we cannot respond individually to each comment received, we do appreciate your feedback and will consider your comments as we revise our tax products. Senior taxes Ordering forms and publications. Senior taxes   Visit www. Senior taxes irs. Senior taxes gov/formspubs/ to download forms and publications, call 1-800-TAX-FORM (1-800-829-3676), or write to the address below and receive a response within 10 days after your request is received. Senior taxes Internal Revenue Service 1201 N. Senior taxes Mitsubishi Motorway Bloomington, IL 61705-6613 Tax questions. Senior taxes   If you have a tax question, check the information available on IRS. Senior taxes gov or call 1-800-829-1040. Senior taxes We cannot answer tax questions sent to either of the above addresses. Senior taxes Useful Items - You may want to see: Publication 463 Travel, Entertainment, Gift, and Car Expenses 525 Taxable and Nontaxable Income 550 Investment Income and Expenses 590 Individual Retirement Arrangements (IRAs) Form (and Instructions) 1040 U. Senior taxes S. Senior taxes Individual Income Tax Return 1040A U. Senior taxes S. Senior taxes Individual Income Tax Return 1040EZ Income Tax Return for Single and Joint Filers With No Dependents 1040NR U. Senior taxes S. Senior taxes Nonresident Alien Income Tax Return 1040NR-EZ U. Senior taxes S. Senior taxes Income Tax Return for Certain Nonresident Aliens With No Dependents 2106 Employee Business Expenses 2106-EZ Unreimbursed Employee Business Expenses 5329 Additional Taxes on Qualified Plans and Other Tax-Favored Accounts 8815 Exclusion of Interest From Series EE and I U. Senior taxes S. Senior taxes Savings Bonds Issued After 1989 8863 Education Credits 8917 Tuition and Fees Deduction Schedule A (Form 1040) Itemized Deductions  See chapter 13, How To Get Tax Help , for information about getting these publications and forms. Senior taxes Prev  Up  Next   Home   More Online Publications