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Turbo Tax Filing For 2010

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Turbo Tax Filing For 2010

Turbo tax filing for 2010 4. Turbo tax filing for 2010   Communications and Air Transportation Taxes Table of Contents Uncollected Tax Report Communications TaxLocal-only service. Turbo tax filing for 2010 Private communication service. Turbo tax filing for 2010 Exemptions Credits or Refunds Air Transportation TaxesTransportation of Persons by Air International Air Travel Facilities Transportation of Property by Air Special Rules on Transportation Taxes Excise taxes are imposed on amounts paid for certain facilities and services. Turbo tax filing for 2010 If you receive any payment on which tax is imposed, you are required to collect the tax, file returns, and pay the tax over to the government. Turbo tax filing for 2010 If you fail to collect and pay over the taxes, you may be liable for the trust fund recovery penalty. Turbo tax filing for 2010 See chapter 14, later. Turbo tax filing for 2010 Uncollected Tax Report A separate report is required to be filed by collecting agents of communications services and air transportation taxes if the person from whom the facilities or services tax (the tax) is required to be collected (the taxpayer) refuses to pay the tax, or it is impossible for the collecting agent to collect the tax. Turbo tax filing for 2010 The report must contain the name and address of the taxpayer, the type of facility provided or service rendered, the amount paid for the facility or service (the amount on which the tax is based), and the date paid. Turbo tax filing for 2010 Regular method taxpayers. Turbo tax filing for 2010   For regular method taxpayers, the report must be filed by the due date of the Form 720 on which the tax would have been reported. Turbo tax filing for 2010 Alternative method taxpayers. Turbo tax filing for 2010   For alternative method taxpayers, the report must be filed by the due date of the Form 720 that includes an adjustment to the separate account for the uncollected tax. Turbo tax filing for 2010 See Alternative method in  chapter 11. Turbo tax filing for 2010 Where to file. Turbo tax filing for 2010    Do not file the uncollected tax report with Form 720. Turbo tax filing for 2010 Instead, mail the report to: Internal Revenue Service Excise Tax Program SE:S:SP:EX MS C9-109 5000 Ellin Rd. Turbo tax filing for 2010  Lanham, MD 20706 Communications Tax A 3% tax is imposed on amounts paid for local telephone service and teletypewriter exchange service. Turbo tax filing for 2010 Local telephone service. Turbo tax filing for 2010   This includes access to a local telephone system and the privilege of telephonic quality communication with most people who are part of the system. Turbo tax filing for 2010 Local telephone service also includes any facility or services provided in connection with this service. Turbo tax filing for 2010 The tax applies to lease payments for certain customer premises equipment (CPE) even though the lessor does not also provide access to a local telecommunications system. Turbo tax filing for 2010 Local-only service. Turbo tax filing for 2010   Local-only service is local telephone service as described above, provided under a plan that does not include long distance telephone service or that separately states the charge for local service on the bill to customers. Turbo tax filing for 2010 Local-only service also includes any facility or services provided in connection with this service, even though these services and facilities may also be used with long-distance service. Turbo tax filing for 2010 Private communication service. Turbo tax filing for 2010   Private communication service is not local telephone service. Turbo tax filing for 2010 Private communication service includes accessory-type services provided in connection with a Centrex, PBX, or other similar system for dual use accessory equipment. Turbo tax filing for 2010 However, the charge for the service must be stated separately from the charge for the basic system, and the accessory must function, in whole or in part, in connection with intercommunication among the subscriber's stations. Turbo tax filing for 2010 Teletypewriter exchange service. Turbo tax filing for 2010   This includes access from a teletypewriter or other data station to a teletypewriter exchange system and the privilege of intercommunication by that station with most persons having teletypewriter or other data stations in the same exchange system. Turbo tax filing for 2010 Figuring the tax. Turbo tax filing for 2010   The tax is based on the sum of all charges for local telephone service included in the bill. Turbo tax filing for 2010 However, if the bill groups individual items for billing and tax purposes, the tax is based on the sum of the individual items within that group. Turbo tax filing for 2010 The tax on the remaining items not included in any group is based on the charge for each item separately. Turbo tax filing for 2010 Do not include in the tax base state or local sales or use taxes that are separately stated on the taxpayer's bill. Turbo tax filing for 2010 Exemptions Payments for certain services or payments from certain users are exempt from the communications tax. Turbo tax filing for 2010 Nontaxable service. Turbo tax filing for 2010   Nontaxable service means bundled service and long distance service. Turbo tax filing for 2010 Nontaxable service also includes pre-paid telephone cards and pre-paid cellular service. Turbo tax filing for 2010 Bundled service. Turbo tax filing for 2010   Bundled service is local and long distance service provided under a plan that does not separately state the charge for the local telephone service. Turbo tax filing for 2010 Bundled service includes plans that provide both local and long distance service for either a flat monthly fee or a charge that varies with the elapsed transmission time for which the service is used. Turbo tax filing for 2010 Telecommunications companies provide bundled service for both landlines and wireless (cellular) service. Turbo tax filing for 2010 If Voice over Internet Protocol service provides both local and long distance service and the charges are not separately stated, such service is bundled service. Turbo tax filing for 2010   The method for sending or receiving a call, such as on a landline telephone, wireless (cellular), or some other method, does not affect whether a service is local-only or bundled. Turbo tax filing for 2010 Long distance service. Turbo tax filing for 2010   Long distance service is telephonic quality communication with persons whose telephones are outside the local telephone system of the caller. Turbo tax filing for 2010 Pre-paid telephone cards (PTC). Turbo tax filing for 2010   A PTC will be treated as bundled service unless a PTC expressly states it is for local-only service. Turbo tax filing for 2010 Generally, the person responsible for collecting the tax is the carrier who transfers the PTC to the transferee. Turbo tax filing for 2010 The transferee is the first person that is not a carrier to whom a PTC is transferred by the carrier. Turbo tax filing for 2010 The transferee is the person liable for the tax and is eligible to request a credit or refund. Turbo tax filing for 2010 For more information, see Regulations section 49. Turbo tax filing for 2010 4251-4. Turbo tax filing for 2010   The holder is the person that purchases a PTC to use and not to resell. Turbo tax filing for 2010 Holders are not liable for the tax and cannot request a credit or refund. Turbo tax filing for 2010 Pre-paid cellular telephones. Turbo tax filing for 2010   Rules similar to the PTC rules described above apply to pre-paid cellular telephones. Turbo tax filing for 2010 The transferee is the person eligible to request the credit or refund. Turbo tax filing for 2010 Installation charges. Turbo tax filing for 2010   The tax does not apply to payments received for the installation of any instrument, wire, pole, switchboard, apparatus, or equipment. Turbo tax filing for 2010 However, the tax does apply to payments for the repair or replacement of those items incidental to ordinary maintenance. Turbo tax filing for 2010 Answering services. Turbo tax filing for 2010   The tax does not apply to amounts paid for a private line, an answering service, and a one-way paging or message service if they do not provide access to a local telephone system and the privilege of telephonic communication as part of the local telephone system. Turbo tax filing for 2010 Mobile radio telephone service. Turbo tax filing for 2010   The tax does not apply to payments for a two-way radio service that does not provide access to a local telephone system. Turbo tax filing for 2010 Coin-operated telephones. Turbo tax filing for 2010   The tax for local telephone service does not apply to payments made for services by inserting coins in public coin-operated telephones. Turbo tax filing for 2010 But the tax applies if the coin-operated telephone service is furnished for a guaranteed amount. Turbo tax filing for 2010 Figure the tax on the amount paid under the guarantee plus any fixed monthly or other periodic charge. Turbo tax filing for 2010 Telephone-operated security systems. Turbo tax filing for 2010   The tax does not apply to amounts paid for telephones used only to originate calls to a limited number of telephone stations for security entry into a building. Turbo tax filing for 2010 In addition, the tax does not apply to any amounts paid for rented communication equipment used in the security system. Turbo tax filing for 2010 News services. Turbo tax filing for 2010   The tax on teletypewriter exchange service does not apply to charges for the following news services. Turbo tax filing for 2010 Services dealing exclusively with the collection or dissemination of news for or through the public press or radio or television broadcasting. Turbo tax filing for 2010 Services used exclusively in the collection or dissemination of news by a news ticker service furnishing a general news service similar to that of the public press. Turbo tax filing for 2010 This exemption applies to payments received for messages from one member of the news media to another member (or to or from their bona fide correspondents). Turbo tax filing for 2010 For the exemption to apply, the charge for these services must be billed in writing to the person paying for the service and that person must certify in writing that the services are used for an exempt purpose. Turbo tax filing for 2010 Services not exempted. Turbo tax filing for 2010   The tax applies to amounts paid by members of the news media for local telephone service. Turbo tax filing for 2010 International organizations and the American Red Cross. Turbo tax filing for 2010   The tax does not apply to communication services furnished to an international organization or to the American National Red Cross. Turbo tax filing for 2010 Nonprofit hospitals. Turbo tax filing for 2010   The tax does not apply to telephone services furnished to income tax-exempt nonprofit hospitals for their use. Turbo tax filing for 2010 Also, the tax does not apply to amounts paid by these hospitals to provide local telephone service in the homes of their personnel who must be reached during their off-duty hours. Turbo tax filing for 2010 Nonprofit educational organizations. Turbo tax filing for 2010   The tax does not apply to payments received for services and facilities furnished to a nonprofit educational organization for its use. Turbo tax filing for 2010 A nonprofit educational organization is one that satisfies all the following requirements. Turbo tax filing for 2010 It normally maintains a regular faculty and curriculum. Turbo tax filing for 2010 It normally has a regularly enrolled body of pupils or students in attendance at the place where its educational activities are regularly carried on. Turbo tax filing for 2010 It is exempt from income tax under section 501(a). Turbo tax filing for 2010 This includes a school operated by an organization exempt under section 501(c)(3) if the school meets the above qualifications. Turbo tax filing for 2010 Qualified blood collector organizations. Turbo tax filing for 2010   The tax does not apply to telephone services furnished to qualified blood collector organizations for their use. Turbo tax filing for 2010 A qualified blood collector organization is one that is: Described in section 501(c)(3) and exempt from tax under section 501(a), Primarily engaged in the activity of collecting human blood, Registered with the IRS, and Registered by the Food and Drug Administration to collect blood. Turbo tax filing for 2010 Federal, state, and local government. Turbo tax filing for 2010   The tax does not apply to communication services provided to the government of the United States, the government of any state or its political subdivisions, the District of Columbia, or the United Nations. Turbo tax filing for 2010 Treat an Indian tribal government as a state for the exemption from the communications tax only if the services involve the exercise of an essential tribal government function. Turbo tax filing for 2010 Exemption certificate. Turbo tax filing for 2010   Any form of exemption certificate will be acceptable if it includes all the information required by the Internal Revenue Code and Regulations. Turbo tax filing for 2010 See Regulations section 49. Turbo tax filing for 2010 4253-11. Turbo tax filing for 2010 File the certificate with the provider of the communication services. Turbo tax filing for 2010 An exemption certificate is not required for nontaxable services. Turbo tax filing for 2010   The following users that are exempt from the communications tax do not have to file an annual exemption certificate after they have filed the initial certificate to claim an exemption from the communications tax. Turbo tax filing for 2010 The American National Red Cross and other international organizations. Turbo tax filing for 2010 Nonprofit hospitals. Turbo tax filing for 2010 Nonprofit educational organizations. Turbo tax filing for 2010 Qualified blood collector organizations. Turbo tax filing for 2010 State and local governments. Turbo tax filing for 2010   The federal government does not have to file any exemption certificate. Turbo tax filing for 2010   All other organizations must furnish exemption certificates when required. Turbo tax filing for 2010 Credits or Refunds If tax is collected and paid over for nontaxable services, or for certain services or users exempt from the communications tax, the collector or taxpayer may claim a credit or refund if it has repaid the tax to the person from whom the tax was collected or obtained the consent of that person to the allowance of the credit or refund. Turbo tax filing for 2010 Alternatively, the person who paid the tax may claim a refund. Turbo tax filing for 2010 For more information on how to file for credits or refunds, see the Instructions for Form 720 or Form 8849. Turbo tax filing for 2010 Collectors. Turbo tax filing for 2010   The collector may request a credit or refund if it has repaid the tax to the person from whom the tax was collected, or obtained the consent of that person to the allowance of the credit or refund. Turbo tax filing for 2010 These requirements also apply to nontaxable service refunds. Turbo tax filing for 2010 Collectors using the regular method for deposits. Turbo tax filing for 2010   Collectors using the regular method for deposits must use Form 720X to request a credit or refund if the collector has repaid the tax to the person from whom the tax was collected, or obtained the consent of that person to the allowance of the credit or refund. Turbo tax filing for 2010 Collectors using the alternative method for deposits. Turbo tax filing for 2010   Collectors using the alternative method for deposits must adjust their separate accounts for the credit or refund if it has repaid the tax to the person from whom the tax was collected, or obtained the consent of that person to the allowance of the credit or refund. Turbo tax filing for 2010 For more information, see the Instructions for Form 720. Turbo tax filing for 2010 Air Transportation Taxes Taxes are imposed on amounts paid for: Transportation of persons by air, Use of international air travel facilities, and Transportation of property by air. Turbo tax filing for 2010 Transportation of Persons by Air The tax on transportation of persons by air is made up of the: Percentage tax, and Domestic-segment tax. Turbo tax filing for 2010 Percentage tax. Turbo tax filing for 2010   A tax of 7. Turbo tax filing for 2010 5% applies to amounts paid for taxable transportation of persons by air. Turbo tax filing for 2010 Amounts paid for transportation include charges for layover or waiting time and movement of aircraft in deadhead service. Turbo tax filing for 2010 Mileage awards. Turbo tax filing for 2010   The percentage tax may apply to an amount paid (in cash or in kind) to an air carrier (or any related person) for the right to provide mileage awards for, or other reductions in the cost of, any transportation of persons by air. Turbo tax filing for 2010 For example, this applies to mileage awards purchased by credit card companies, telephone companies, restaurants, hotels, and other businesses. Turbo tax filing for 2010   Generally, the percentage tax does not apply to amounts paid for mileage awards where the mileage awards cannot, under any circumstances, be redeemed for air transportation that is subject to the tax. Turbo tax filing for 2010 Until regulations are issued, the following rules apply to mileage awards. Turbo tax filing for 2010 Amounts paid for mileage awards that cannot be redeemed for taxable transportation beginning and ending in the United States are not subject to the tax. Turbo tax filing for 2010 For this rule, mileage awards issued by a foreign air carrier are considered to be usable only on that foreign air carrier and thus not redeemable for taxable transportation beginning and ending in the United States. Turbo tax filing for 2010 Therefore, amounts paid to a foreign air carrier for mileage awards are not subject to the tax. Turbo tax filing for 2010 Amounts paid by an air carrier to a domestic air carrier for mileage awards that can be redeemed for taxable transportation are not subject to the tax to the extent those miles will be awarded in connection with the purchase of taxable transportation. Turbo tax filing for 2010 Amounts paid by an air carrier to a domestic air carrier for mileage awards that can be redeemed for taxable transportation are subject to the tax to the extent those miles will not be awarded in connection with the purchase of taxable transportation. Turbo tax filing for 2010 Domestic-segment tax. Turbo tax filing for 2010   The domestic-segment tax is a flat dollar amount for each segment of taxable transportation for which an amount is paid. Turbo tax filing for 2010 However, see Rural airports, later. Turbo tax filing for 2010 A segment is a single takeoff and a single landing. Turbo tax filing for 2010 The amount of the domestic-segment tax is in the Instructions for Form 720. Turbo tax filing for 2010 Charter flights. Turbo tax filing for 2010    If an aircraft is chartered, the domestic-segment tax for each segment of taxable transportation is figured by multiplying the tax by the number of passengers transported on the aircraft. Turbo tax filing for 2010 Rural airports. Turbo tax filing for 2010   The domestic-segment tax does not apply to a segment to or from a rural airport. Turbo tax filing for 2010 An airport is a rural airport for a calendar year if fewer than 100,000 commercial passengers departed from the airport by air during the second preceding calendar year (the 100,000 passenger rule), and one of the following is true: The airport is not located within 75 miles of another airport from which 100,000 or more commercial passengers departed during the second preceding calendar year, The airport was receiving essential air service subsidies as of August 5, 1997, or The airport is not connected by paved roads to another airport. Turbo tax filing for 2010   To apply the 100,000 passenger rule to any airport described in (3) above, only count commercial passengers departing from the airport by air on flight segments of at least 100 miles. Turbo tax filing for 2010   An updated list of rural airports can be found on the Department of Transportation website at www. Turbo tax filing for 2010 dot. Turbo tax filing for 2010 gov and enter the phrase “Essential Air Service” in the search box. Turbo tax filing for 2010 Taxable transportation. Turbo tax filing for 2010   Taxable transportation is transportation by air that meets either of the following tests. Turbo tax filing for 2010 It begins and ends either in the United States or at any place in Canada or Mexico not more than 225 miles from the nearest point on the continental United States boundary (this is the 225-mile zone). Turbo tax filing for 2010 It is directly or indirectly from one port or station in the United States to another port or station in the United States, but only if it is not a part of uninterrupted international air transportation, discussed later. Turbo tax filing for 2010 Round trip. Turbo tax filing for 2010   A round trip is considered two separate trips. Turbo tax filing for 2010 The first trip is from the point of departure to the destination. Turbo tax filing for 2010 The second trip is the return trip from that destination. Turbo tax filing for 2010 Uninterrupted international air transportation. Turbo tax filing for 2010   This means transportation entirely by air that does not begin and end in the United States or in the 225-mile zone if there is not more than a 12-hour scheduled interval between arrival and departure at any station in the United States. Turbo tax filing for 2010 For a special rule that applies to military personnel, see Exemptions, later. Turbo tax filing for 2010 Transportation between the continental U. Turbo tax filing for 2010 S. Turbo tax filing for 2010 and Alaska or Hawaii. Turbo tax filing for 2010   This transportation is partially exempt from the tax on transportation of persons by air. Turbo tax filing for 2010 The tax does not apply to the part of the trip between the point at which the route of transportation leaves or enters the continental United States (or a port or station in the 225-mile zone) and the point at which it enters or leaves Hawaii or Alaska. Turbo tax filing for 2010 Leaving or entering occurs when the route of the transportation passes over either the United States border or a point 3 nautical miles (3. Turbo tax filing for 2010 45 statute miles) from low tide on the coast line, or when it leaves a port or station in the 225-mile zone. Turbo tax filing for 2010 Therefore, this transportation is subject to the percentage tax on the part of the trip in U. Turbo tax filing for 2010 S. Turbo tax filing for 2010 airspace, the domestic-segment tax for each domestic segment, and the tax on the use of international air travel facilities, discussed later. Turbo tax filing for 2010 Transportation within Alaska or Hawaii. Turbo tax filing for 2010   The tax on transportation of persons by air applies to the entire fare paid in the case of flights between any of the Hawaiian Islands, and between any ports or stations in the Aleutian Islands or other ports or stations elsewhere in Alaska. Turbo tax filing for 2010 The tax applies even though parts of the flights may be over international waters or over Canada, if no point on the direct line of transportation between the ports or stations is more than 225 miles from the United States (Hawaii or Alaska). Turbo tax filing for 2010 Package tours. Turbo tax filing for 2010   The air transportation taxes apply to “complimentary” air transportation furnished solely to participants in package holiday tours. Turbo tax filing for 2010 The amount paid for these package tours includes a charge for air transportation even though it may be advertised as “free. Turbo tax filing for 2010 ” This rule also applies to the tax on the use of international air travel facilities, discussed later. Turbo tax filing for 2010 Liability for tax. Turbo tax filing for 2010   The person paying for taxable transportation is liable for the tax and, ordinarily, the person receiving the payment collects the tax, files the returns, and pays the tax over to the government. Turbo tax filing for 2010 However, if payment is made outside the United States for a prepaid order, exchange order, or similar order, the person furnishing the initial transportation provided for under that order must collect the tax. Turbo tax filing for 2010    A travel agency that is an independent broker and sells tours on aircraft that it charters must collect the transportation tax, file the returns, and pay the tax over to the government. Turbo tax filing for 2010 However, a travel agency that sells tours as the agent of an airline must collect the tax and remit it to the airline for the filing of returns and for the payment of the tax over to the government. Turbo tax filing for 2010 An independent third party that is not under the airline's supervision or control, but is acting on behalf of, and receiving compensation from, a passenger, is not required to collect the tax and pay it to the government. Turbo tax filing for 2010 For more information on resellers of air transportation, see Revenue Ruling 2006-52. Turbo tax filing for 2010 You can find Revenue Ruling 2006-52 on page 761 of I. Turbo tax filing for 2010 R. Turbo tax filing for 2010 B. Turbo tax filing for 2010 2006-43 at www. Turbo tax filing for 2010 irs. Turbo tax filing for 2010 gov/pub/irs-irbs/irb06-43. Turbo tax filing for 2010 pdf. Turbo tax filing for 2010   The fact that the aircraft does not use public or commercial airports in taking off and landing has no effect on the tax. Turbo tax filing for 2010 But see Certain helicopter uses, later. Turbo tax filing for 2010   For taxable transportation that begins and ends in the United States, the tax applies regardless of whether the payment is made in or outside the United States. Turbo tax filing for 2010   If the tax is not paid when payment for the transportation is made, the air carrier providing the initial segment of the transportation that begins or ends in the United States becomes liable for the tax. Turbo tax filing for 2010 Exemptions. Turbo tax filing for 2010   The tax on transportation of persons by air does not apply in the following situations. Turbo tax filing for 2010 See also Special Rules on Transportation Taxes, later. Turbo tax filing for 2010 Military personnel on international trips. Turbo tax filing for 2010   When traveling in uniform at their own expense, United States military personnel on authorized leave are deemed to be traveling in uninterrupted international air transportation (defined earlier) even if the scheduled interval between arrival and departure at any station in the United States is actually more than 12 hours. Turbo tax filing for 2010 However, such personnel must buy their tickets within 12 hours after landing at the first domestic airport and accept the first available accommodation of the type called for by their tickets. Turbo tax filing for 2010 The trip must begin or end outside the United States and the 225-mile zone. Turbo tax filing for 2010 Certain helicopter uses. Turbo tax filing for 2010   The tax does not apply to air transportation by helicopter if the helicopter is used for any of the following purposes. Turbo tax filing for 2010 Transporting individuals, equipment, or supplies in the exploration for, or the development or removal of, hard minerals, oil, or gas. Turbo tax filing for 2010 Planting, cultivating, cutting, transporting, or caring for trees (including logging operations). Turbo tax filing for 2010 Providing emergency medical transportation. Turbo tax filing for 2010   However, during a use described in items (1) or (2), the tax applies if the helicopter takes off from, or lands at, a facility eligible for assistance under the Airport and Airway Development Act of 1970, or otherwise uses services provided under section 44509 or 44913(b) or subchapter I of chapter 471 of title 49, United States Code. Turbo tax filing for 2010 For item (1), treat each flight segment as a separate flight. Turbo tax filing for 2010 Fixed-wing aircraft uses. Turbo tax filing for 2010   The tax does not apply to air transportation by fixed-wing aircraft if the fixed-wing aircraft is used for any of the following purposes. Turbo tax filing for 2010 Planting, cultivating, cutting, transporting, or caring for trees (including logging operations). Turbo tax filing for 2010 Providing emergency medical transportation. Turbo tax filing for 2010 The aircraft must be equipped for and exclusively dedicated on that flight to acute care emergency medical services. Turbo tax filing for 2010   However, during a use described in item (1), the tax applies if the fixed-wing aircraft takes off from, or lands at, a facility eligible for assistance under the Airport and Airway Development Act of 1970, or otherwise uses services provided under section 44509 or 44913(b) or subchapter I of chapter 471 of title 49, United States Code. Turbo tax filing for 2010 Skydiving. Turbo tax filing for 2010   The tax does not apply to any air transportation exclusively for the purpose of skydiving. Turbo tax filing for 2010 Seaplanes. Turbo tax filing for 2010   The tax does not apply to any air transportation by seaplane for any segment consisting of a takeoff from, and a landing on, water if the places where the takeoff and landing occur are not receiving financial assistance from the Airport and Airways Trust Fund. Turbo tax filing for 2010 Bonus tickets. Turbo tax filing for 2010   The tax does not apply to free bonus tickets issued by an airline company to its customers who have satisfied all requirements to qualify for the bonus tickets. Turbo tax filing for 2010 However, the tax applies to amounts paid by customers for advance bonus tickets when customers have traveled insufficient mileage to fully qualify for the free advance bonus tickets. Turbo tax filing for 2010 International Air Travel Facilities A tax per person is imposed (whether in or outside the United States) for international flights that begin or end in the United States. Turbo tax filing for 2010 However, for a domestic segment that begins or ends in Alaska or Hawaii, a reduced tax per person applies only to departures. Turbo tax filing for 2010 This tax does not apply if all the transportation is subject to the percentage tax, discussed earlier. Turbo tax filing for 2010 It also doesn't apply if the surtax on fuel used in a fractional ownership program aircraft (discussed earlier) is imposed. Turbo tax filing for 2010 See the Instructions for Form 720 for the tax rates. Turbo tax filing for 2010 Transportation of Property by Air A tax of 6. Turbo tax filing for 2010 25% is imposed on amounts paid (whether in or outside the United States) for transportation of property by air. Turbo tax filing for 2010 The fact that the aircraft may not use public or commercial airports in taking off and landing has no effect on the tax. Turbo tax filing for 2010 The tax applies only to amounts paid to a person engaged in the business of transporting property by air for hire. Turbo tax filing for 2010 The tax applies only to transportation (including layover time and movement of aircraft in deadhead service) that begins and ends in the United States. Turbo tax filing for 2010 Thus, the tax does not apply to transportation of property by air that begins or ends outside the United States. Turbo tax filing for 2010 Exemptions. Turbo tax filing for 2010   The tax on transportation of property by air does not apply in the following situations. Turbo tax filing for 2010 See also Special Rules on Transportation Taxes, later. Turbo tax filing for 2010 Cropdusting and firefighting service. Turbo tax filing for 2010   The tax does not apply to amounts paid for cropdusting or aerial firefighting service. Turbo tax filing for 2010 Exportation. Turbo tax filing for 2010    The tax does not apply to payments for transportation of property by air in the course of exportation (including to United States possessions) by continuous movement, as evidenced by the execution of Form 1363, Export Exemption Certificate. Turbo tax filing for 2010 See Form 1363 for more information. Turbo tax filing for 2010 Certain helicopter and fixed-wing air ambulance uses. Turbo tax filing for 2010   The tax does not apply to amounts paid for the use of helicopters in construction to set heating and air conditioning units on roofs of buildings, to dismantle tower cranes, and to aid in construction of power lines and ski lifts. Turbo tax filing for 2010   The tax also does not apply to air transportation by helicopter or fixed-wing aircraft for the purpose of providing emergency medical services. Turbo tax filing for 2010 The fixed-wing aircraft must be equipped for and exclusively dedicated on that flight to acute care emergency medical services. Turbo tax filing for 2010 Skydiving. Turbo tax filing for 2010   The tax does not apply to any air transportation exclusively for the purpose of skydiving. Turbo tax filing for 2010 Excess baggage. Turbo tax filing for 2010    The tax does not apply to excess baggage accompanying a passenger on an aircraft operated on an established line. Turbo tax filing for 2010 Surtax on fuel used in a fractional ownership program aircraft. Turbo tax filing for 2010   The tax does not apply if the surtax on fuel used in a fractional ownership program aircraft (discussed earlier) is imposed. Turbo tax filing for 2010 Alaska and Hawaii. Turbo tax filing for 2010   For transportation of property to and from Alaska and Hawaii, the tax in general does not apply to the portion of the transportation that is entirely outside the continental United States (or the 225-mile zone if the aircraft departs from or arrives at an airport in the 225-mile zone). Turbo tax filing for 2010 But the tax applies to flights between ports or stations in Alaska and the Aleutian Islands, as well as between ports or stations in Hawaii. Turbo tax filing for 2010 The tax applies even though parts of the flights may be over international waters or over Canada, if no point on a line drawn from where the route of transportation leaves the United States (Alaska) to where it reenters the United States (Alaska) is more than 225 miles from the United States. Turbo tax filing for 2010 Liability for tax. Turbo tax filing for 2010   The person paying for taxable transportation is liable for the tax and, ordinarily, the person engaged in the business of transporting property by air for hire receives the payment, collects the tax, files the returns, and pays the tax over to the government. Turbo tax filing for 2010   If tax is not paid when a payment is made outside the United States, the person furnishing the last segment of taxable transportation collects the tax from the person to whom the property is delivered in the United States. Turbo tax filing for 2010 Special Rules on Transportation Taxes In certain circumstances, special rules apply to the taxes on transportation of persons and property by air. Turbo tax filing for 2010 Aircraft used by affiliated corporations. Turbo tax filing for 2010   The taxes do not apply to payments received by one member of an affiliated group of corporations from another member for services furnished in connection with the use of an aircraft. Turbo tax filing for 2010 However, the aircraft must be owned or leased by a member of the affiliated group and cannot be available for hire by a nonmember of the affiliated group. Turbo tax filing for 2010 Determine whether an aircraft is available for hire by a nonmember of an affiliated group on a flight-by-flight basis. Turbo tax filing for 2010   For this rule, an affiliated group of corporations is any group of corporations connected with a common parent corporation through 80% or more of stock ownership. Turbo tax filing for 2010 Small aircraft. Turbo tax filing for 2010   The taxes do not apply to transportation furnished by an aircraft having a maximum certificated takeoff weight of 6,000 pounds or less. Turbo tax filing for 2010 However, the taxes do apply if the aircraft is operated on an established line. Turbo tax filing for 2010 “Operated on an established line” means the aircraft operates with some degree of regularity between definite points. Turbo tax filing for 2010 However, it does not include any time an aircraft is being operated on a flight that is solely for sightseeing. Turbo tax filing for 2010   Consider an aircraft to be operated on an established line if it is operated on a charter basis between two cities also served by that carrier on a regularly scheduled basis. Turbo tax filing for 2010   Also, the taxes apply if the aircraft is jet-powered, regardless of its maximum certificated takeoff weight or whether or not it is operated on an established line. Turbo tax filing for 2010 Mixed load of persons and property. Turbo tax filing for 2010   If a single amount is paid for air transportation of persons and property, the payment must be allocated between the amount subject to the tax on transportation of persons and the amount subject to the tax on transportation of property. Turbo tax filing for 2010 The allocation must be reasonable and supported by adequate records. Turbo tax filing for 2010 Credits or refunds. Turbo tax filing for 2010   If tax is collected and paid over for air transportation that is not taxable air transportation, the collector may claim a credit or refund if it has repaid the tax to the person from whom the tax was collected or obtained the consent of that person to the allowance of the credit or refund. Turbo tax filing for 2010 Alternatively, the person who paid the tax may claim a refund. Turbo tax filing for 2010 For information on how to file for credits or refunds, see the Instructions for Form 720 or Form 8849. Turbo tax filing for 2010 Prev  Up  Next   Home   More Online Publications
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The Turbo Tax Filing For 2010

Turbo tax filing for 2010 6. Turbo tax filing for 2010   Retail Tax on Heavy Trucks, Trailers, and Tractors Table of Contents Highway vehicle. Turbo tax filing for 2010 Vehicles not considered highway vehicles. Turbo tax filing for 2010 Idling reduction device. Turbo tax filing for 2010 Separate purchase. Turbo tax filing for 2010 Leases. Turbo tax filing for 2010 Exported vehicle. Turbo tax filing for 2010 Tax on resale of tax-paid trailers and semitrailers. Turbo tax filing for 2010 Use treated as sale. Turbo tax filing for 2010 Sale. Turbo tax filing for 2010 Long-term lease. Turbo tax filing for 2010 Short-term lease. Turbo tax filing for 2010 Related person. Turbo tax filing for 2010 Exclusions from tax base. Turbo tax filing for 2010 Sales not at arm's length. Turbo tax filing for 2010 Installment sales. Turbo tax filing for 2010 Repairs and modifications. Turbo tax filing for 2010 Further manufacture. Turbo tax filing for 2010 Rail trailers and rail vans. Turbo tax filing for 2010 Parts and accessories. Turbo tax filing for 2010 Trash containers. Turbo tax filing for 2010 House trailers. Turbo tax filing for 2010 Camper coaches or bodies for self-propelled mobile homes. Turbo tax filing for 2010 Farm feed, seed, and fertilizer equipment. Turbo tax filing for 2010 Ambulances and hearses. Turbo tax filing for 2010 Truck-tractors. Turbo tax filing for 2010 Concrete mixers. Turbo tax filing for 2010 Registration requirement. Turbo tax filing for 2010 Further manufacture. Turbo tax filing for 2010 A tax of 12% of the sales price is imposed on the first retail sale of the following articles, including related parts and accessories sold on or in connection with, or with the sale of, the articles. Turbo tax filing for 2010 Truck chassis and bodies. Turbo tax filing for 2010 Truck trailer and semitrailer chassis and bodies. Turbo tax filing for 2010 Tractors of the kind chiefly used for highway transportation in combination with a trailer or semitrailer. Turbo tax filing for 2010 A truck is a highway vehicle primarily designed to transport its load on the same chassis as the engine, even if it is equipped to tow a vehicle, such as a trailer or semitrailer. Turbo tax filing for 2010 A tractor is a highway vehicle designed to tow a vehicle, such as a trailer or semitrailer. Turbo tax filing for 2010 A tractor may carry incidental items of cargo when towing or limited amounts of cargo when not towing. Turbo tax filing for 2010 A sale of a truck, truck trailer, or semitrailer is considered a sale of a chassis and a body. Turbo tax filing for 2010 The seller is liable for the tax. Turbo tax filing for 2010 Chassis or body. Turbo tax filing for 2010   A chassis or body is taxable only if you sell it for use as a component part of a highway vehicle that is a truck, truck trailer or semitrailer, or a tractor of the kind chiefly used for highway transportation in combination with a trailer or semitrailer. Turbo tax filing for 2010 Highway vehicle. Turbo tax filing for 2010   A highway vehicle is any self-propelled vehicle designed to carry a load over public highways, whether or not it is also designed to perform other functions. Turbo tax filing for 2010 Examples of vehicles designed to carry a load over public highways are passenger automobiles, motorcycles, buses, and highway-type trucks and truck tractors. Turbo tax filing for 2010 A vehicle is a highway vehicle even though the vehicle's design allows it to perform a highway transportation function for only one of the following. Turbo tax filing for 2010 A particular type of load, such as passengers, furnishings, and personal effects (as in a house, office, or utility trailer). Turbo tax filing for 2010 A special kind of cargo, goods, supplies, or materials. Turbo tax filing for 2010 Some off-highway task unrelated to highway transportation, except as discussed next. Turbo tax filing for 2010 Vehicles not considered highway vehicles. Turbo tax filing for 2010   Generally, the following kinds of vehicles are not considered highway vehicles for purposes of the retail tax. Turbo tax filing for 2010 Specially designed mobile machinery for nontransportation functions. Turbo tax filing for 2010 A self-propelled vehicle is not a highway vehicle if all the following apply. Turbo tax filing for 2010 The chassis has permanently mounted to it machinery or equipment used to perform certain operations (construction, manufacturing, drilling, mining, timbering, processing, farming, or similar operations) if the operation of the machinery or equipment is unrelated to transportation on or off the public highways. Turbo tax filing for 2010 The chassis has been specially designed to serve only as a mobile carriage and mount (and power source, if applicable) for the machinery or equipment, whether or not the machinery or equipment is in operation. Turbo tax filing for 2010 The chassis could not, because of its special design and without substantial structural modification, be used as part of a vehicle designed to carry any other load. Turbo tax filing for 2010 Vehicles specially designed for off-highway transportation. Turbo tax filing for 2010 A vehicle is not treated as a highway vehicle if the vehicle is specially designed for the primary function of transporting a particular type of load other than over the public highway and because of this special design, the vehicles's capability to transport a load over a public highway is substantially limited or impaired. Turbo tax filing for 2010 To make this determination, you can take into account the vehicle's size, whether the vehicle is subject to licensing, safety, or other requirements, and whether the vehicle can transport a load at a sustained speed of at least 25 miles per hour. Turbo tax filing for 2010 It does not matter that the vehicle can carry heavier loads off highway than it is allowed to carry over the highway. Turbo tax filing for 2010 Nontransportation trailers and semitrailers. Turbo tax filing for 2010 A trailer or semitrailer is not treated as a highway vehicle if it is specially designed to function only as an enclosed stationary shelter for carrying on a nontransportation function at an off-highway site. Turbo tax filing for 2010 For example, a trailer that is capable only of functioning as an office for an off-highway construction operation is not a highway vehicle. Turbo tax filing for 2010 Gross vehicle weight. Turbo tax filing for 2010   The tax does not apply to truck chassis and bodies suitable for use with a vehicle that has a gross vehicle weight (defined below) of 33,000 pounds or less. Turbo tax filing for 2010 It also does not apply to truck trailer and semitrailer chassis and bodies suitable for use with a trailer or semitrailer that has a gross vehicle weight of 26,000 pounds or less. Turbo tax filing for 2010 Tractors that have a gross vehicle weight of 19,500 pounds or less and a gross combined weight of 33,000 pounds or less are excluded from the 12% retail tax. Turbo tax filing for 2010   The following four classifications of truck body types meet the suitable for use standard and will be excluded from the retail excise tax. Turbo tax filing for 2010 Platform truck bodies 21 feet or less in length. Turbo tax filing for 2010 Dry freight and refrigerated truck van bodies 24 feet or less in length. Turbo tax filing for 2010 Dump truck bodies with load capacities of 8 cubic yards or less. Turbo tax filing for 2010 Refuse packer truck bodies with load capacities of 20 cubic yards or less. Turbo tax filing for 2010 For more information on these classifications, see Revenue Procedure 2005-19, which is on page 832 of I. Turbo tax filing for 2010 R. Turbo tax filing for 2010 B. Turbo tax filing for 2010 2005-14 at www. Turbo tax filing for 2010 irs. Turbo tax filing for 2010 gov/pub/irs-irbs/irb05-14. Turbo tax filing for 2010 pdf. Turbo tax filing for 2010   The gross vehicle weight means the maximum total weight of a loaded vehicle. Turbo tax filing for 2010 Generally, this maximum total weight is the gross vehicle weight rating provided by the manufacturer or determined by the seller of the completed article. Turbo tax filing for 2010 The seller's gross vehicle weight rating is determined solely on the basis of the strength of the chassis frame and the axle capacity and placement. Turbo tax filing for 2010 The seller may not take into account any readily attachable components (such as tires or rim assemblies) in determining the gross vehicle weight. Turbo tax filing for 2010 See Regulations section 145. Turbo tax filing for 2010 4051-1(e)(3) for more information. Turbo tax filing for 2010 Parts or accessories. Turbo tax filing for 2010   The tax applies to parts or accessories sold on or in connection with, or with the sale of, a taxable article. Turbo tax filing for 2010 For example, if at the time of the sale by the retailer, the part or accessory has been ordered from the retailer, the part or accessory will be considered as sold in connection with the sale of the vehicle. Turbo tax filing for 2010 The tax applies in this case whether or not the retailer bills the parts or accessories separately. Turbo tax filing for 2010   If the retailer sells a taxable chassis, body, or tractor without parts or accessories considered essential for the operation or appearance of the taxable article, the sale of the parts or accessories by the retailer to the purchaser is considered made in connection with the sale of the taxable article even though they are shipped separately, at the same time, or on a different date. Turbo tax filing for 2010 The tax applies unless there is evidence to the contrary. Turbo tax filing for 2010 For example, if a retailer sells to any person a chassis and the bumpers for the chassis, or sells a taxable tractor and the fifth wheel and attachments, the tax applies to the parts or accessories regardless of the method of billing or the time at which the shipments were made. Turbo tax filing for 2010 The tax does not apply to parts and accessories that are spares or replacements. Turbo tax filing for 2010   The tax imposed on parts and accessories sold on or in connection with the taxable articles listed earlier and the tax imposed on the separate purchase of parts and accessories (discussed next) for the taxable articles listed earlier do not apply to an idling reduction device or insulation that has an R value of at least R35 per inch. Turbo tax filing for 2010 Idling reduction device. Turbo tax filing for 2010   An idling reduction device is any device or system of devices that provide the tractor with services, such as heat, air conditioning, and electricity, without the use of the main drive engine while the tractor is temporarily parked or stationary. Turbo tax filing for 2010 The device must be affixed to the tractor and determined by the Administrator of the EPA, in consultation with the Secretary of Energy and Secretary of Transportation, to reduce idling while parked or stationary. Turbo tax filing for 2010 The EPA discusses idling reduction technologies on its website at www. Turbo tax filing for 2010 epa. Turbo tax filing for 2010 gov/smartway/technology/idling. Turbo tax filing for 2010 htm. Turbo tax filing for 2010 Separate purchase. Turbo tax filing for 2010   The tax generally applies to the price of a part or accessory and its installation if the following conditions are met. Turbo tax filing for 2010 The owner, lessee, or operator of any vehicle that contains a taxable article installs any part or accessory on the vehicle. Turbo tax filing for 2010 The installation occurs within 6 months after the vehicle is first placed in service. Turbo tax filing for 2010   The owners of the trade or business installing the parts or accessories are secondarily liable for the tax. Turbo tax filing for 2010   A vehicle is placed in service on the date the owner takes actual possession of the vehicle. Turbo tax filing for 2010 This date is established by a signed delivery ticket or other comparable document indicating delivery to and acceptance by the owner. Turbo tax filing for 2010   The tax does not apply if the installed part or accessory is a replacement part or accessory. Turbo tax filing for 2010 The tax also does not apply if the total price of the parts and accessories, including installation charges, during the 6-month period is $1,000 or less. Turbo tax filing for 2010 However, if the total price is more than $1,000, the tax applies to the cost of all parts and accessories (and installation charges) during that period. Turbo tax filing for 2010 Example. Turbo tax filing for 2010 You bought a taxable vehicle and placed it in service on April 8. Turbo tax filing for 2010 On May 3, you bought and installed parts and accessories at a cost of $850. Turbo tax filing for 2010 On July 15, you bought and installed parts and accessories for $300. Turbo tax filing for 2010 Tax of $138 (12% of $1,150) applies on July 15. Turbo tax filing for 2010 Also, tax will apply to any costs of additional parts and accessories installed on the vehicle before October 8. Turbo tax filing for 2010 First retail sale defined. Turbo tax filing for 2010   The sale of an article is treated as the first retail sale, and the seller will be liable for the tax imposed on the sale unless one of the following exceptions applies. Turbo tax filing for 2010 There has been a prior taxable sale, lease, or use of the article (however, see Tax on resale of tax-paid trailers and semitrailers, later). Turbo tax filing for 2010 The sale qualifies as a tax-free sale under section 4221 (see Sales exempt from tax, later). Turbo tax filing for 2010 The seller in good faith accepts from the purchaser a statement signed under penalties of perjury and executed in good faith that the purchaser intends to resell the article or lease it on a long-term basis. Turbo tax filing for 2010 There is no registration requirement. Turbo tax filing for 2010 Leases. Turbo tax filing for 2010   A long-term lease (a lease with a term of 1 year or more, taking into account options to renew) before a first retail sale is treated as a taxable sale. Turbo tax filing for 2010 The tax is imposed on the lessor at the time of the lease. Turbo tax filing for 2010   A short-term lease (a lease with a term of less than 1 year, taking into account options to renew) before a first retail sale is treated as a taxable use. Turbo tax filing for 2010 The tax is imposed on the lessor at the time of the lease. Turbo tax filing for 2010 Exported vehicle. Turbo tax filing for 2010   A vehicle exported before its first retail sale, used in a foreign country, and then returned to the United States is subject to the retail tax on its first domestic use or retail sale after importation. Turbo tax filing for 2010 Tax on resale of tax-paid trailers and semitrailers. Turbo tax filing for 2010   The tax applies to a trailer or semitrailer resold within 6 months after having been sold in a taxable sale. Turbo tax filing for 2010 The seller liable for the tax on the resale can claim a credit equal to the tax paid on the prior taxable sale. Turbo tax filing for 2010 The credit cannot exceed the tax on the resale. Turbo tax filing for 2010 See Regulations section 145. Turbo tax filing for 2010 4052-1(a)(4) for information on the conditions to allowance for the credit. Turbo tax filing for 2010 Use treated as sale. Turbo tax filing for 2010   If any person uses a taxable article before the first retail sale of the article, that person is liable for the tax as if the article had been sold at retail by that person. Turbo tax filing for 2010 Figure the tax on the price at which similar articles are sold in the ordinary course of trade by retailers. Turbo tax filing for 2010 The tax attaches when the use begins. Turbo tax filing for 2010   If the seller of an article regularly sells the articles at retail in arm's-length transactions, figure the tax on its use on the lowest established retail price for the articles in effect at the time of the taxable use. Turbo tax filing for 2010   If the seller of an article does not regularly sell the articles at retail in arm's-length transactions, a constructive price on which the tax is figured will be determined by the IRS after considering the selling practices and price structures of sellers of similar articles. Turbo tax filing for 2010   If a seller of an article incurs liability for tax on the use of the article and later sells or leases the article in a transaction that otherwise would be taxable, liability for tax is not incurred on the later sale or lease. Turbo tax filing for 2010 Presumptive retail sales price. Turbo tax filing for 2010   There are rules to ensure that the tax base of transactions considered to be taxable sales includes either an actual or presumed markup percentage. Turbo tax filing for 2010 If the person liable for tax is the vehicle's manufacturer, producer, or importer, the following discussions show how you figure the presumptive retail sales price depending on the type of transaction and the persons involved in the transaction. Turbo tax filing for 2010 Table 6-1 outlines the appropriate tax base calculation for various transactions. Turbo tax filing for 2010   The presumed markup percentage to be used for trucks and truck-tractors is 4%. Turbo tax filing for 2010 But for truck trailers and semitrailers and remanufactured trucks and tractors, the presumed markup percentage is zero. Turbo tax filing for 2010 Sale. Turbo tax filing for 2010   For a taxable sale by a manufacturer, producer, importer, or related person, you generally figure the tax on a tax base of the sales price plus an amount equal to the presumed markup percentage times that sales price. Turbo tax filing for 2010 Long-term lease. Turbo tax filing for 2010   In the case of a long-term lease by a manufacturer, producer, importer, or related person, figure the tax on a tax base of the constructive sales price plus an amount equal to the presumed markup percentage times the constructive sales price. Turbo tax filing for 2010 Short-term lease. Turbo tax filing for 2010   When a manufacturer, producer, importer, or related person leases an article in a short-term lease considered a taxable use, figure the tax on a constructive sales price at which those or similar articles generally are sold in the ordinary course of trade by retailers. Turbo tax filing for 2010   But if the lessor in this situation regularly sells articles at retail in arm's-length transactions, figure the tax on the lowest established retail price in effect at the time of the taxable use. Turbo tax filing for 2010   If a person other than the manufacturer, producer, importer, or related person leases an article in a short-term lease considered a taxable use, figure the tax on a tax base of the price for which the article was sold to the lessor plus the cost of parts and accessories installed by the lessor and a presumed markup percentage. Turbo tax filing for 2010 Related person. Turbo tax filing for 2010   A related person is any member of the same controlled group as the manufacturer, producer, or importer. Turbo tax filing for 2010 Do not treat as a related person a person that sells the articles through a permanent retail establishment in the normal course of being a retailer if that person has records to prove the article was sold for a price that included a markup equal to or greater than the presumed markup percentage. Turbo tax filing for 2010 Table 6-1. Turbo tax filing for 2010 Tax Base IF the transaction is a. Turbo tax filing for 2010 . Turbo tax filing for 2010 . Turbo tax filing for 2010 THEN figuring the base by using the. Turbo tax filing for 2010 . Turbo tax filing for 2010 . Turbo tax filing for 2010 Sale by the manufacturer, producer, importer, or related person Sales price plus (presumed markup percentage × sales price) Sale by the dealer Total consideration paid for the item including any charges incident to placing it in a condition ready for use Long-term lease by the manufacturer, producer, importer, or related person Constructive sales price plus (presumed markup percentage × constructive sales price) Short-term lease by the manufacturer, producer, importer, or related person Constructive sales price at which such or similar articles are sold Short-term lease by a lessor other than the manufacturer, producer, importer, or related person Price for which the article was sold to the lessor plus the cost of parts and accessories installed by the lessor plus a presumed markup percentage Short-term lease where the articles are regularly sold at arm's length Lowest established retail price in effect at the time of the taxable use General rule for sales by dealers to the consumer. Turbo tax filing for 2010   For a taxable sale, other than a long-term lease, by a person other than a manufacturer, producer, importer, or related person, your tax base is the retail sales price as discussed next under Determination of tax base. Turbo tax filing for 2010   When you sell an article to the consumer, generally you do not add a presumed markup to the tax base. Turbo tax filing for 2010 However, you do add a markup if all the following apply. Turbo tax filing for 2010 You do not perform any significant activities relating to the processing of the sale of a taxable article. Turbo tax filing for 2010 The main reason for processing the sale through you is to avoid or evade the presumed markup. Turbo tax filing for 2010 You do not have records proving that the article was sold for a price that included a markup equal to or greater than the presumed markup percentage. Turbo tax filing for 2010 In these situations, your tax base is the sales price plus an amount equal to the presumed markup percentage times that selling price. Turbo tax filing for 2010 Determination of tax base. Turbo tax filing for 2010   These rules apply to both normal retail sales price and presumptive retail sales price computations. Turbo tax filing for 2010 To arrive at the tax base, the price is the total consideration paid (including trade-in allowance) for the item and includes any charge incident to placing the article in a condition ready for use. Turbo tax filing for 2010 However, see Presumptive retail sales price, earlier. Turbo tax filing for 2010 Exclusions from tax base. Turbo tax filing for 2010   Exclude from the tax base the retail excise tax imposed on the sale. Turbo tax filing for 2010 Exclude any state or local retail sales tax if stated as a separate charge from the price whether the sales tax is imposed on the seller or purchaser. Turbo tax filing for 2010 Also exclude the value of any used component of the article furnished by the first user of the article. Turbo tax filing for 2010   Exclude charges for transportation, delivery, insurance, and installation (other than installation charges for parts and accessories, discussed earlier) and other expenses incurred in connection with the delivery of an article to a purchaser. Turbo tax filing for 2010 These expenses are those incurred in delivery from the retail dealer to the customer. Turbo tax filing for 2010 In the case of delivery directly from the manufacturer to the dealer's customer, include the transportation and delivery charges to the extent the charges do not exceed what it would have cost to ship the article to the dealer. Turbo tax filing for 2010   Exclude amounts charged for machinery or equipment that does not contribute to the highway transportation function of the vehicle, provided those charges are supported by adequate records. Turbo tax filing for 2010 For example, for an industrial vacuum loader vehicle, exclude amounts charged for the vacuum pump and hose, filter system, material separator, silencer or muffler, control cabinet, and ladder. Turbo tax filing for 2010 Similarly, for a sewer cleaning vehicle, exclude amounts charged for the high pressure water pump, hose components, and the vacuum pipe. Turbo tax filing for 2010 Sales not at arm's length. Turbo tax filing for 2010   For any taxable article sold (not at arm's length) at less than the fair market price, figure the excise tax on the price for which similar articles are sold at retail in the ordinary course of trade. Turbo tax filing for 2010   A sale is not at arm's length if either of the following apply. Turbo tax filing for 2010 One of the parties is controlled (in law or in fact) by the other or there is common control, whether or not the control is actually exercised to influence the sales price. Turbo tax filing for 2010 The sale is made under special arrangements between a seller and a purchaser. Turbo tax filing for 2010 Installment sales. Turbo tax filing for 2010   If the first retail sale is an installment sale, or other form of sale in which the sales price is paid in installments, tax liability arises at the time of the sale. Turbo tax filing for 2010 The tax is figured on the entire sales price. Turbo tax filing for 2010 No part of the tax is deferred because the sales price is paid in installments. Turbo tax filing for 2010 Repairs and modifications. Turbo tax filing for 2010   The tax does not apply to the sale or use of an article that has been repaired or modified unless the cost of the repairs and modifications is more than 75% of the retail price of a comparable new article. Turbo tax filing for 2010 This includes modifications that change the transportation function of an article or restore a wrecked article to a functional condition. Turbo tax filing for 2010 However, this exception generally does not apply to an article that was not subject to the tax when it was new. Turbo tax filing for 2010 Further manufacture. Turbo tax filing for 2010   The tax does not apply to the use by a person of a taxable article as material in the manufacture or production of, or as a component part of, another article to be manufactured or produced by that person. Turbo tax filing for 2010 Do not treat a person as engaged in the manufacture of any article merely because that person combines the article with a: Coupling device (including any fifth wheel); Wrecker crane; Loading and unloading equipment (including any crane, hoist, winch, or power liftgate); Aerial ladder or tower; Ice and snow control equipment; Earth moving, excavation, and construction equipment; Spreader; Sleeper cab; Cab shield; or Wood or metal floor. Turbo tax filing for 2010 Combining an article with an item in this list does not give rise to taxability. Turbo tax filing for 2010 However, see Parts or accessories discussed earlier. Turbo tax filing for 2010 Articles exempt from tax. Turbo tax filing for 2010   The tax on heavy trucks, trailers, and tractors does not apply to sales of the articles described in the following discussions. Turbo tax filing for 2010 Rail trailers and rail vans. Turbo tax filing for 2010   This is any chassis or body of a trailer or semitrailer designed for use both as a highway vehicle and a railroad car (including any parts and accessories designed primarily for use on and in connection with it). Turbo tax filing for 2010 Do not treat a piggyback trailer or semitrailer as designed for use as a railroad car. Turbo tax filing for 2010 Parts and accessories. Turbo tax filing for 2010   This is any part or accessory sold separately from the truck or trailer, except as described earlier under Parts or accessories and Separate purchase. Turbo tax filing for 2010 Trash containers. Turbo tax filing for 2010   This is any box, container, receptacle, bin, or similar article that meets all the following conditions. Turbo tax filing for 2010 It is designed to be used as a trash container. Turbo tax filing for 2010 It is not designed to carry freight other than trash. Turbo tax filing for 2010 It is not designed to be permanently mounted on or affixed to a truck chassis or body. Turbo tax filing for 2010 House trailers. Turbo tax filing for 2010   This is any house trailer (regardless of size) suitable for use in connection with either passenger automobiles or trucks. Turbo tax filing for 2010 Camper coaches or bodies for self-propelled mobile homes. Turbo tax filing for 2010   This is any article designed to be mounted or placed on trucks, truck chassis, or automobile chassis and to be used primarily as living quarters or camping accommodations. Turbo tax filing for 2010 Further, the tax does not apply to chassis specifically designed and constructed to accommodate and transport self-propelled mobile home bodies. Turbo tax filing for 2010 Farm feed, seed, and fertilizer equipment. Turbo tax filing for 2010   This is any body primarily designed to process or prepare, haul, spread, load, or unload feed, seed, or fertilizer to or on farms. Turbo tax filing for 2010 This exemption applies only to the farm equipment body (and parts and accessories) and not to the chassis upon which the farm equipment is mounted. Turbo tax filing for 2010 Ambulances and hearses. Turbo tax filing for 2010   This is any ambulance, hearse, or combination ambulance-hearse. Turbo tax filing for 2010 Truck-tractors. Turbo tax filing for 2010   This is any truck-tractor specifically designed for use in shifting semitrailers in and around freight yards and freight terminals. Turbo tax filing for 2010 Concrete mixers. Turbo tax filing for 2010   This is any article designed to be placed or mounted on a truck, truck trailer, or semitrailer chassis to be used to process or prepare concrete. Turbo tax filing for 2010 This exemption does not apply to the chassis on which the article is mounted. Turbo tax filing for 2010 Sales exempt from tax. Turbo tax filing for 2010   The following sales are ordinarily exempt from tax. Turbo tax filing for 2010 Sales to a state or local government for its exclusive use. Turbo tax filing for 2010 Sales to Indian tribal governments, but only if the transaction involves the exercise of an essential tribal government function. Turbo tax filing for 2010 Sales to a nonprofit educational organization for its exclusive use. Turbo tax filing for 2010 Sales to a qualified blood collector organization (as defined under Communications Tax in chapter 4) for its exclusive use in the collection, storage, or transportation of blood. Turbo tax filing for 2010 Sales for use by the purchaser for further manufacture of other taxable articles (see below). Turbo tax filing for 2010 Sales for export or for resale by the purchaser to a second purchaser for export. Turbo tax filing for 2010 Sales to the United Nations for official use. Turbo tax filing for 2010 Registration requirement. Turbo tax filing for 2010   In general, the seller and buyer must be registered for a sale to be tax free. Turbo tax filing for 2010 See the Form 637 instructions for more information. Turbo tax filing for 2010 Certain registration exceptions apply in the case of sales to state and local governments, sales to foreign purchasers for export, and sales for resale or long term leasing. Turbo tax filing for 2010 Further manufacture. Turbo tax filing for 2010   If you buy articles tax free and resell or use them other than in the manufacture of another article, you are liable for the tax on their resale or use just as if you had manufactured and made the first retail sale of them. Turbo tax filing for 2010 Credits or refunds. Turbo tax filing for 2010   A credit or refund (without interest) of the retail tax on the taxable articles described earlier may be allowable if the tax has been paid with respect to an article and, before any other use, such article is used by any person as a component part of another taxable article manufactured or produced. Turbo tax filing for 2010 The person using the article as a component part is eligible for the credit or refund. Turbo tax filing for 2010   A credit or refund is allowable if, before any other use, an article is, by any person: Exported, Used or sold for use as supplies for vessels, Sold to a state or local government for its exclusive use, Sold to a nonprofit educational organization for its exclusive use, or Sold to a qualified blood collector organization (as defined under Communications Tax in chapter 4) for its exclusive use in the collection, storage, or transportation of blood. Turbo tax filing for 2010 A credit or refund is also allowable if there is a price readjustment by reason of the return or repossession of an article or by reason of a bona fide discount, rebate, or allowance. Turbo tax filing for 2010   See also Conditions to allowance in chapter 5. Turbo tax filing for 2010 Tire credit. Turbo tax filing for 2010   A credit is allowed against the retail tax on the taxable articles described earlier if taxable tires are sold on or in connection with the sale of the article. Turbo tax filing for 2010 The credit is equal to the manufacturers excise tax imposed on the taxable tires (discussed earlier). Turbo tax filing for 2010 This is the section 4051(d) taxable tire credit and is claimed on Schedule C (Form 720) for the same quarter for which the tax on the heavy vehicle is reported. Turbo tax filing for 2010 Prev  Up  Next   Home   More Online Publications