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Who Has Free State Tax Filing

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Who Has Free State Tax Filing

Who has free state tax filing Publication 929 - Main Content Table of Contents Part 1. Who has free state tax filing Rules for All Dependents Filing RequirementsEarned Income Only Unearned Income Only Both Earned and Unearned Income Other Filing Requirements Should a Return Be Filed Even If Not Required? Responsibility for Child's ReturnThird party designee. Who has free state tax filing Designated as representative. Who has free state tax filing IRS notice. Who has free state tax filing Standard DeductionStandard Deduction of Zero Dependent's Own Exemption Withholding From WagesExceptions. Who has free state tax filing Part 2. Who has free state tax filing Tax on Unearned Income of Certain ChildrenWhich Parent's Return To Use Parent's Election To Report Child's Interest and DividendsEffect of Making the Election Figuring Child's Income Figuring Additional Tax Tax for Certain Children Who Have Unearned IncomeProviding Parental Information (Form 8615, Lines A–C) Step 1. Who has free state tax filing Figuring the Child's Net Unearned Income (Form 8615, Part I) Step 2. Who has free state tax filing Figuring a Tentative Tax at the Parent's Tax Rate (Form 8615, Part II) Step 3. Who has free state tax filing Figuring the Child's Tax (Form 8615, Part III) Alternative Minimum Tax Illustrated Example Part 1. Who has free state tax filing Rules for All Dependents This part of the publication discusses the filing requirements for dependents, who is responsible for a child's return, how to figure a dependent's standard deduction and exemption (if any), and whether a dependent can claim exemption from federal income tax withholding. Who has free state tax filing Filing Requirements Whether a dependent has to file a return generally depends on the amount of the dependent's earned and unearned income and whether the dependent is married, is age 65 or older, or is blind. Who has free state tax filing A dependent may have to file a return even if his or her income is less than the amount that would normally require a return. Who has free state tax filing See Other Filing Requirements, later. Who has free state tax filing The following sections apply to dependents with: Earned income only, Unearned income only, and Both earned and unearned income. Who has free state tax filing  To find out whether a dependent must file, read the section that applies, or use Table 1. Who has free state tax filing Earned Income Only A dependent whose gross income is only earned income must file a return if the gross income is more than the amount listed in the following table. Who has free state tax filing Marital Status Amount Single   Under 65 and not blind $6,100 Either 65 or older or blind $7,600 65 or older and blind $9,100 Married*   Under 65 and not blind $6,100 Either 65 or older or blind $7,300 65 or older and blind $8,500 *If a dependent's spouse itemizes deductions on a separate return, the dependent must file a return if the dependent has $5 or more of gross income (earned and/or unearned). Who has free state tax filing Example. Who has free state tax filing William is 16. Who has free state tax filing His mother claims an exemption for him on her income tax return. Who has free state tax filing He worked part time on weekends during the school year and full time during the summer. Who has free state tax filing He earned $7,000 in wages. Who has free state tax filing He did not have any unearned income. Who has free state tax filing He must file a tax return because he has earned income only and his gross income is more than $6,100. Who has free state tax filing If he is blind, he does not have to file a return because his gross income is not more than $7,600. Who has free state tax filing Unearned Income Only A dependent whose gross income is only unearned income must file a return if the gross income is more than the amount listed in the following table. Who has free state tax filing Marital Status Amount Single   Under 65 and not blind $1,000 Either 65 or older or blind $2,500 65 or older and blind $4,000 Married*   Under 65 and not blind $1,000 Either 65 or older or blind $2,200 65 or older and blind $3,400 *If a dependent's spouse itemizes deductions on a separate return, the dependent must file a return if the dependent has $5 or more of gross income (earned and/or unearned). Who has free state tax filing Example. Who has free state tax filing Sarah is 18 and single. Who has free state tax filing Her parents can claim an exemption for her on their income tax return. Who has free state tax filing She received $1,970 of taxable interest and dividend income. Who has free state tax filing She did not work during the year. Who has free state tax filing She must file a tax return because she has unearned income only and her gross income is more than $1,000. Who has free state tax filing If she is blind, she does not have to file a return because she has unearned income only and her gross income is not more than $2,500. Who has free state tax filing Election to report child's unearned income on parent's return. Who has free state tax filing   A parent of a child under age 19 (or under age 24 if a full-time student) may be able to elect to include the child's interest and dividend income on the parent's return. Who has free state tax filing See Parent's Election To Report Child's Interest and Dividends in Part 2. Who has free state tax filing If the parent makes this election, the child does not have to file a return. Who has free state tax filing Both Earned and Unearned Income A dependent who has both earned and unearned income generally must file a return if the dependent's gross income is more than line 5 of the following worksheet. Who has free state tax filing Filing Requirement Worksheet for Most Dependents 1. Who has free state tax filing Enter dependent's earned income plus $350     2. Who has free state tax filing Minimum amount   $1,000 3. Who has free state tax filing Compare lines 1 and 2. Who has free state tax filing Enter the larger amount     4. Who has free state tax filing Maximum amount   6,100 5. Who has free state tax filing Compare lines 3 and 4. Who has free state tax filing Enter the smaller amount     6. Who has free state tax filing Enter the dependent's gross income. Who has free state tax filing If line 6 is more than line 5, the dependent must file an income tax return. Who has free state tax filing If the dependent is married and his or her spouse itemizes deductions on a separate return, the dependent must file an income tax return if line 6 is $5 or more. Who has free state tax filing       Table 1. Who has free state tax filing 2013 Filing Requirements for Dependents If your parent (or someone else) can claim you as a dependent, use this table to see if you must file a return. Who has free state tax filing   See the definitions of “dependent,”“earned income,”“unearned income,” and “gross income” in the Glossary. Who has free state tax filing   Single dependents—Were you either age 65 or older or blind?     No. Who has free state tax filing You must file a return if any of the following apply. Who has free state tax filing       Your unearned income was over $1,000. Who has free state tax filing Your earned income was over $6,100. Who has free state tax filing Your gross income was more than the larger of—       $1,000, or Your earned income (up to $5,750) plus $350. Who has free state tax filing         Yes. Who has free state tax filing You must file a return if any of the following apply. Who has free state tax filing     Your unearned income was over $2,500 ($4,000 if 65 or older and blind), Your earned income was over $7,600 ($9,100 if 65 or older and blind), Your gross income was more than the larger of—       $2,500 ($4,000 if 65 or older and blind), or Your earned income (up to $5,750) plus $1,850 ($3,350 if 65 or older and blind). Who has free state tax filing       Married dependents—Were you either age 65 or older or blind?     No. Who has free state tax filing You must file a return if any of the following apply. Who has free state tax filing       Your gross income was at least $5 and your spouse files a separate return and itemizes deductions. Who has free state tax filing Your unearned income was over $1,000. Who has free state tax filing Your earned income was over $6,100. Who has free state tax filing Your gross income was more than the larger of—       $1,000, or Your earned income (up to $5,750) plus $350. Who has free state tax filing       Yes. Who has free state tax filing You must file a return if any of the following apply. Who has free state tax filing       Your gross income was at least $5 and your spouse files a separate return and itemizes deductions. Who has free state tax filing Your unearned income was over $2,200 ($3,400 if 65 or older and blind), Your earned income was over $7,300 ($8,500 if 65 or older and blind), Your gross income was more than the larger of—       $2,200 ($3,400 if 65 or older and blind), or Your earned income (up to $5,750) plus $1,550 ($2,750 if 65 or older and blind). Who has free state tax filing       Example 1. Who has free state tax filing Joe is 20, single, not blind, and a full-time college student. Who has free state tax filing He does not provide more than half of his own support, and his parents claim an exemption for him on their income tax return. Who has free state tax filing He received $200 taxable interest income and earned $2,750 from a part-time job. Who has free state tax filing He does not have to file a tax return because his gross income of $2,950 ($200 interest plus $2,750 in wages) is not more than $3,100, the amount on line 5 of his filled-in Filing Requirement Worksheet for Most Dependents (shown next). Who has free state tax filing Filled-in Example 1 Filing Requirement Worksheet  for Most Dependents 1. Who has free state tax filing Enter dependent's earned income plus $350   $ 3,100 2. Who has free state tax filing Minimum amount   1,000 3. Who has free state tax filing Compare lines 1 and 2. Who has free state tax filing Enter the larger amount   3,100 4. Who has free state tax filing Maximum amount   6,100 5. Who has free state tax filing Compare lines 3 and 4. Who has free state tax filing Enter the smaller amount   3,100 6. Who has free state tax filing Enter the dependent's gross income. Who has free state tax filing If line 6 is more than line 5, the dependent must file an income tax return. Who has free state tax filing If the dependent is married and his or her spouse itemizes deductions on a separate return, the dependent must file an income tax return if line 6 is $5 or more. Who has free state tax filing   $ 2,950   Example 2. Who has free state tax filing The facts are the same as in Example 1 except that Joe had $600 taxable interest income. Who has free state tax filing He must file a tax return because his gross income of $3,350 ($600 interest plus $2,750 wages) is more than $3,100, the amount on line 5 of his filled-in worksheet (shown next). Who has free state tax filing Filled-in Example 2 Filing Requirement Worksheet for Most Dependents 1. Who has free state tax filing Enter dependent's earned income plus $350   $ 3,100 2. Who has free state tax filing Minimum amount   1,000 3. Who has free state tax filing Compare lines 1 and 2. Who has free state tax filing Enter the larger amount   3,100 4. Who has free state tax filing Maximum amount   6,100 5. Who has free state tax filing Compare lines 3 and 4. Who has free state tax filing Enter the smaller amount   3,100 6. Who has free state tax filing Enter the dependent's gross income. Who has free state tax filing If line 6 is more than line 5, the dependent must file an income tax return. Who has free state tax filing If the dependent is married and his or her spouse itemizes deductions on a separate return, the dependent must file an income tax return if line 6 is $5 or more. Who has free state tax filing   $ 3,350   Age 65 or older or blind. Who has free state tax filing A dependent who is age 65 or older or blind must file a return if his or her gross income is more than line 7 of the following worksheet. Who has free state tax filing Filing Requirement Worksheet  for Dependents Who Are Age 65 or Older or Blind 1. Who has free state tax filing Enter dependent's earned income plus $350     2. Who has free state tax filing Minimum amount   $1,000 3. Who has free state tax filing Compare lines 1 and 2. Who has free state tax filing Enter the larger amount     4. Who has free state tax filing Maximum amount   6,100 5. Who has free state tax filing Compare lines 3 and 4. Who has free state tax filing Enter the smaller amount     6. Who has free state tax filing Enter the amount from the following table that applies to the dependent       Marital Status Amount     Single         Either 65 or older or blind $1,500       65 or older and blind $3,000     Married         Either 65 or older or blind $1,200       65 or older and blind $2,400   7. Who has free state tax filing Add lines 5 and 6. Who has free state tax filing Enter the total     8. Who has free state tax filing Enter the dependent's gross income. Who has free state tax filing If line 8 is more than line 7, the dependent must file an income tax return. Who has free state tax filing If the dependent is married and his or her spouse itemizes deductions on a separate return, the dependent must file an income tax return if line 8 is $5 or more     Example 3. Who has free state tax filing The facts are the same as in Example 2 except that Joe is also blind. Who has free state tax filing He does not have to file a return because his gross income of $3,350 is not more than $4,600, the amount on line 7 of his filled-in Filing Requirement Worksheet for Dependents Who Are Age 65 or Older or Blind (shown next). Who has free state tax filing   Filled-in Example 3 Filing Requirement Worksheet  for Dependents Who Are Age 65 or Older or Blind 1. Who has free state tax filing Enter dependent's earned income plus $350   $3,100 2. Who has free state tax filing Minimum amount   1,000 3. Who has free state tax filing Compare lines 1 and 2. Who has free state tax filing Enter the larger amount   3,100 4. Who has free state tax filing Maximum amount   6,100 5. Who has free state tax filing Compare lines 3 and 4. Who has free state tax filing Enter the smaller amount   3,100 6. Who has free state tax filing Enter the amount from the following table that applies to the dependent   1,500   Marital Status Amount     Single         Either 65 or older or blind $1,500       65 or older and blind $3,000     Married         Either 65 or older or blind $1,200       65 or older and blind $2,400   7. Who has free state tax filing Add lines 5 and 6. Who has free state tax filing Enter the total   4,600 8. Who has free state tax filing Enter the dependent's gross income. Who has free state tax filing If line 8 is more than line 7, the dependent must file an income tax return. Who has free state tax filing If the dependent is married and his or her spouse itemizes deductions on a separate return, the dependent must file an income tax return if line 8 is $5 or more   $3,350 Other Filing Requirements Some dependents may have to file a tax return even if their income is less than the amount that would normally require them to file a return. Who has free state tax filing A dependent must file a tax return if he or she owes any other taxes, such as: Social security and Medicare taxes on tips not reported to his or her employer or on wages received from an employer who did not withhold these taxes, Uncollected social security and Medicare or railroad retirement taxes on tips reported to his or her employer or on group-term life insurance, Alternative minimum tax, Additional tax on a health savings account from Form 8889, Part III, Recapture taxes, such as the tax from recapture of an education credit, or Additional tax on a qualified plan, including an individual retirement arrangement (IRA), or other tax-favored account. Who has free state tax filing But if the dependent is filing a return only because of this tax, the dependent can file Form 5329 by itself. Who has free state tax filing A dependent must also file a tax return if he or she: Had wages of $108. Who has free state tax filing 28 or more from a church or qualified church-controlled organization that is exempt from employer social security and Medicare taxes, or Had net earnings from self-employment of at least $400. Who has free state tax filing Spouse itemizes. Who has free state tax filing   A dependent must file a return if the dependent's spouse itemizes deductions on a separate return and the dependent has $5 or more of gross income (earned and/or unearned). Who has free state tax filing Should a Return Be Filed Even If Not Required? Even if a dependent does not meet any of the filing requirements discussed earlier, he or she should file a tax return if either of the following applies. Who has free state tax filing Income tax was withheld from his or her income. Who has free state tax filing He or she qualifies for the earned income credit, additional child tax credit, health coverage tax credit, or refundable American opportunity education credit. Who has free state tax filing See the tax return instructions to find out who qualifies for these credits. Who has free state tax filing  By filing a return, the dependent can get a refund. Who has free state tax filing Responsibility for Child's Return Generally, a child is responsible for filing his or her own tax return and for paying any tax, penalties, or interest on that return. Who has free state tax filing If a child cannot file his or her own return for any reason, such as age, the child's parent, guardian, or other legally responsible person must file it for the child. Who has free state tax filing Signing the child's return. Who has free state tax filing   If the child cannot sign his or her return, a parent or guardian must sign the child's name followed by the words “By (signature), parent (or guardian) for minor child. Who has free state tax filing ” Authority of parent or guardian. Who has free state tax filing   A parent or guardian who signs a return on a child's behalf can deal with the IRS on all matters connected with the return. Who has free state tax filing   In general, a parent or guardian who does not sign the child's return can only provide information concerning the child's return and pay the child's tax. Who has free state tax filing That parent or guardian is not entitled to receive information from the IRS or legally bind the child to a tax liability arising from the return. Who has free state tax filing Third party designee. Who has free state tax filing   A child's parent or guardian who does not sign the child's return may be authorized, as a third party designee, to discuss the processing of the return with the IRS as well as provide information concerning the return. Who has free state tax filing The child or the person signing the return on the child's behalf must check the “Yes” box in the “Third Party Designee” area of the return and name the parent or guardian as the designee. Who has free state tax filing   If designated, a parent or guardian can respond to certain IRS notices and receive information about the processing of the return and the status of a refund or payment. Who has free state tax filing This designation does not authorize the parent or guardian to receive any refund check, bind the child to any tax liability, or otherwise represent the child before the IRS. Who has free state tax filing See the return instructions for more information. Who has free state tax filing Designated as representative. Who has free state tax filing   A parent or guardian who does not sign the child's return may be designated as the child's representative by the child or the person signing the return on the child's behalf. Who has free state tax filing Form 2848, Power of Attorney and Declaration of Representative, is used to designate a child's representative. Who has free state tax filing See Publication 947, Practice Before the IRS and Power of Attorney, for more information. Who has free state tax filing   If designated, a parent or guardian can receive information about the child's return but cannot legally bind the child to a tax liability unless authorized to do so by the law of the state in which the child lives. Who has free state tax filing IRS notice. Who has free state tax filing   If you or the child receives a notice from the IRS concerning the child's return or tax liability, you should immediately inform the IRS that the notice concerns a child. Who has free state tax filing The notice will show who to contact. Who has free state tax filing The IRS will try to resolve the matter with the parent(s) or guardian(s) of the child consistent with their authority. Who has free state tax filing Child's earnings. Who has free state tax filing   For federal income tax purposes, amounts a child earns by performing services are included in the gross income of the child and not the gross income of the parent. Who has free state tax filing This is true even if, under state law, the parent has the right to the earnings and may actually have received them. Who has free state tax filing If the child does not pay the tax due on this income, the parent may be liable for the tax. Who has free state tax filing Child's expenses. Who has free state tax filing   Deductions for payments that are made out of a child's earnings are the child's, even if the payments are made by the parent. Who has free state tax filing Example. Who has free state tax filing You made payments on your child's behalf that are deductible as a business expense and a charitable contribution. Who has free state tax filing You made the payments out of your child's earnings. Who has free state tax filing These items can be deducted only on the child's return. Who has free state tax filing Standard Deduction The standard deduction for an individual who can be claimed as a dependent on another person's tax return is generally limited to the larger of: $1,000, or The individual's earned income plus $350, but not more than the regular standard deduction (generally $6,100). Who has free state tax filing However, the standard deduction may be higher for a dependent who: Is 65 or older, or Is blind. Who has free state tax filing Certain dependents cannot claim any standard deduction. Who has free state tax filing See Standard Deduction of Zero , later. Who has free state tax filing Worksheet 1. Who has free state tax filing   Use Worksheet 1 to figure the dependent's standard deduction. Who has free state tax filing Worksheet 1. Who has free state tax filing Standard Deduction Worksheet for Dependents Use this worksheet only if someone else can claim you (or your spouse, if filing jointly) as a dependent. Who has free state tax filing If you were 65 or older and/or blind, check the correct number of boxes below. Who has free state tax filing Put the total number of boxes checked in box c and go to line 1. Who has free state tax filing a. Who has free state tax filing You 65 or older   Blind   b. Who has free state tax filing Your spouse, if claiming  spouse's exemption 65 or older   Blind   c. Who has free state tax filing Total boxes checked         1. Who has free state tax filing Enter your earned income (defined below) plus $350. Who has free state tax filing If none, enter -0-. Who has free state tax filing 1. Who has free state tax filing     2. Who has free state tax filing Minimum amount. Who has free state tax filing   2. Who has free state tax filing $1,000   3. Who has free state tax filing Compare lines 1 and 2. Who has free state tax filing Enter the larger of the two amounts here. Who has free state tax filing 3. Who has free state tax filing     4. Who has free state tax filing Enter on line 4 the amount shown below for your filing status. Who has free state tax filing       Single or Married filing separately—$6,100 Married filing jointly—$12,200 Head of household—$8,950 4. Who has free state tax filing     5. Who has free state tax filing Standard deduction. Who has free state tax filing         a. Who has free state tax filing Compare lines 3 and 4. Who has free state tax filing Enter the smaller amount here. Who has free state tax filing If under 65 and not blind, stop here. Who has free state tax filing This is your standard deduction. Who has free state tax filing Otherwise, go on to line 5b. Who has free state tax filing 5a. Who has free state tax filing     b. Who has free state tax filing If 65 or older or blind, multiply $1,500 ($1,200 if married) by the number in box c above. Who has free state tax filing Enter the result here. Who has free state tax filing 5b. Who has free state tax filing     c. Who has free state tax filing Add lines 5a and 5b. Who has free state tax filing This is your standard deduction for 2013. Who has free state tax filing 5c. Who has free state tax filing     Earned income includes wages, salaries, tips, professional fees, and other compensation received for personal services you performed. Who has free state tax filing It also includes any amount received as a scholarship that you must include in income. Who has free state tax filing   Example 1. Who has free state tax filing Michael is single, age 15, and not blind. Who has free state tax filing His parents can claim him as a dependent on their tax return. Who has free state tax filing He has taxable interest income of $800 and wages of $150. Who has free state tax filing He enters $500 (his earned income plus $350) on line 1 of Worksheet 1. Who has free state tax filing On line 3, he enters $1,000, the larger of $500 or $1,000. Who has free state tax filing Michael enters $6,100 on line 4. Who has free state tax filing On line 5a, he enters $1,000, the smaller of $1,000 or $6,100. Who has free state tax filing His standard deduction is $1,000. Who has free state tax filing Example 2. Who has free state tax filing Judy, a full-time student, is single, age 22, and not blind. Who has free state tax filing Her parents can claim her as a dependent on their tax return. Who has free state tax filing She has dividend income of $275 and wages of $2,500. Who has free state tax filing She enters $2,850 (her earned income plus $350) on line 1 of Worksheet 1. Who has free state tax filing On line 3, she enters $2,850, the larger of $2,850 or $1,000. Who has free state tax filing She enters $6,100 on line 4. Who has free state tax filing On line 5a, she enters $2,850 (the smaller of $2,850 or $6,100) as her standard deduction. Who has free state tax filing Example 3. Who has free state tax filing Amy, who is single, is claimed as a dependent on her parents' tax return. Who has free state tax filing She is 18 years old and blind. Who has free state tax filing She has taxable interest income of $1,000 and wages of $2,000. Who has free state tax filing She enters $2,350 (her earned income plus $350) on line 1 of Worksheet 1. Who has free state tax filing She enters $2,350 (the larger of $2,350 or $1,000) on line 3, $6,100 on line 4, and $2,350 (the smaller of $2,350 or $6,100) on line 5a. Who has free state tax filing Because Amy is blind, she checks the box for blindness and enters “1” in box c at the top of Worksheet 1. Who has free state tax filing She enters $1,500 (the number in box c times $1,500) on line 5b. Who has free state tax filing Her standard deduction on line 5c is $3,850 ($2,350 + $1,500). Who has free state tax filing Standard Deduction of Zero The standard deduction for the following dependents is zero. Who has free state tax filing A married dependent filing a separate return whose spouse itemizes deductions. Who has free state tax filing A dependent who files a return for a period of less than 12 months due to a change in his or her annual accounting period. Who has free state tax filing A nonresident or dual-status alien dependent, unless the dependent is married to a U. Who has free state tax filing S. Who has free state tax filing citizen or resident alien at the end of the year and chooses to be treated as a U. Who has free state tax filing S. Who has free state tax filing resident for the year. Who has free state tax filing See Publication 519, U. Who has free state tax filing S. Who has free state tax filing Tax Guide for Aliens, for information on making this choice. Who has free state tax filing Example. Who has free state tax filing Jennifer, who is a dependent of her parents, is entitled to file a joint return with her husband. Who has free state tax filing However, her husband elects to file a separate return and itemize his deductions. Who has free state tax filing Because he itemizes, Jennifer's standard deduction on her return is zero. Who has free state tax filing She can, however, itemize any of her allowable deductions. Who has free state tax filing Dependent's Own Exemption A person who can be claimed as a dependent on another taxpayer's return cannot claim his or her own exemption. Who has free state tax filing This is true even if the other taxpayer does not actually claim the exemption. Who has free state tax filing Example. Who has free state tax filing James and Barbara can claim their child, Ben, as a dependent on their return. Who has free state tax filing Ben is a college student who works during the summer and must file a tax return. Who has free state tax filing Ben cannot claim his own exemption on his return. Who has free state tax filing This is true even if James and Barbara do not claim him as a dependent on their return. Who has free state tax filing Withholding From Wages Employers generally withhold federal income tax, social security tax, and Medicare tax from an employee's wages. Who has free state tax filing If the employee claims exemption from withholding on Form W-4, the employer will not withhold federal income tax. Who has free state tax filing The exemption from withholding does not apply to social security and Medicare taxes. Who has free state tax filing Conditions for exemption from withholding. Who has free state tax filing   An employee can claim exemption from withholding for 2014 only if he or she meets both of the following conditions. Who has free state tax filing For 2013, the employee had a right to a refund of all federal income tax withheld because he or she had no tax liability. Who has free state tax filing For 2014, the employee expects a refund of all federal income tax withheld because he or she expects to have no tax liability. Who has free state tax filing Dependents. Who has free state tax filing   An employee who is a dependent ordinarily cannot claim exemption from withholding if both of the following are true. Who has free state tax filing The employee's gross income will be more than $1,000, the minimum standard deduction for 2014. Who has free state tax filing The employee's unearned income will be more than $350. Who has free state tax filing Exceptions. Who has free state tax filing   An employee may be able to claim exemption from withholding even if the employee is a dependent, if the employee: Is age 65 or older, Is blind, or Will claim on his or her 2014 tax return: Adjustments to income, Tax credits, or Itemized deductions. Who has free state tax filing The above exceptions do not apply to supplemental wages greater than $1,000,000. Who has free state tax filing For more information, see Exemption From Withholding in chapter 1 of Publication 505. Who has free state tax filing Example. Who has free state tax filing Guy is 17 and a student. Who has free state tax filing During the summer he works part time at a grocery store. Who has free state tax filing He expects to earn about $1,200 this year. Who has free state tax filing He also worked at the store last summer and received a refund of all his withheld income tax because he did not have a tax liability. Who has free state tax filing The only other income he expects during the year is $375 interest on a savings account. Who has free state tax filing He expects that his parents will be able to claim him as a dependent on their tax return. Who has free state tax filing He is not blind and will not claim adjustments to income, itemized deductions, a higher standard deduction, or tax credits on his return. Who has free state tax filing Guy cannot claim exemption from withholding when he fills out Form W-4 because his parents will be able to claim him as a dependent, his gross income will be more than $1,000 (the minimum standard deduction amount) and his unearned income will be more than $350. Who has free state tax filing Claiming exemption from withholding. Who has free state tax filing    To claim exemption from withholding, an employee must enter “Exempt” in the space provided on Form W-4, line 7. Who has free state tax filing The employee must complete the rest of the form, as explained in the form instructions, and give it to his or her employer. Who has free state tax filing Renewing an exemption from withholding. Who has free state tax filing   An exemption from withholding is good for only one year. Who has free state tax filing An employee must file a new Form W-4 by February 15 each year to continue the exemption. Who has free state tax filing Part 2. Who has free state tax filing Tax on Unearned Income of Certain Children The two rules that follow may affect the tax on the unearned income of certain children. Who has free state tax filing If the child's interest and dividend income (including capital gain distributions) total less than $10,000, the child's parent may be able to choose to include that income on the parent's return rather than file a return for the child. Who has free state tax filing (See Parent's Election To Report Child's Interest and Dividends , later. Who has free state tax filing ) If the child's interest, dividends, and other unearned income total more than $2,000, part of that income may be taxed at the parent's tax rate instead of the child's tax rate. Who has free state tax filing (See Tax for Certain Children Who Have Unearned Income , later. Who has free state tax filing ) For these rules, the term “child” includes a legally adopted child and a stepchild. Who has free state tax filing These rules apply whether or not the child is a dependent. Who has free state tax filing These rules do not apply if neither of the child's parents were living at the end of the year. Who has free state tax filing Which Parent's Return To Use If a child's parents are married to each other and file a joint return, use the joint return to figure the tax on the child's unearned income. Who has free state tax filing The tax rate and other return information from that return are used to figure the child's tax as explained later under Tax for Certain Children Who Have Unearned Income . Who has free state tax filing Parents Who Do Not File a Joint Return For parents who do not file a joint return, the following discussions explain which parent's tax return must be used to figure the tax. Who has free state tax filing Only the parent whose tax return is used can make the election described under Parent's Election To Report Child's Interest and Dividends . Who has free state tax filing Parents are married. Who has free state tax filing   If the child's parents file separate returns, use the return of the parent with the greater taxable income. Who has free state tax filing Parents not living together. Who has free state tax filing   If the child's parents are married to each other but not living together, and the parent with whom the child lives (the custodial parent) is considered unmarried, use the return of the custodial parent. Who has free state tax filing If the custodial parent is not considered unmarried, use the return of the parent with the greater taxable income. Who has free state tax filing   For an explanation of when a married person living apart from his or her spouse is considered unmarried, see Head of Household in Publication 501. Who has free state tax filing Parents are divorced. Who has free state tax filing   If the child's parents are divorced or legally separated, and the parent who had custody of the child for the greater part of the year (the custodial parent) has not remarried, use the return of the custodial parent. Who has free state tax filing Custodial parent remarried. Who has free state tax filing   If the custodial parent has remarried, the stepparent (rather than the noncustodial parent) is treated as the child's other parent. Who has free state tax filing Therefore, if the custodial parent and the stepparent file a joint return, use that joint return. Who has free state tax filing Do not use the return of the noncustodial parent. Who has free state tax filing   If the custodial parent and the stepparent are married, but file separate returns, use the return of the one with the greater taxable income. Who has free state tax filing If the custodial parent and the stepparent are married but not living together, the earlier discussion under Parents not living together applies. Who has free state tax filing Parents never married. Who has free state tax filing   If a child's parents have never been married to each other, but lived together all year, use the return of the parent with the greater taxable income. Who has free state tax filing If the parents did not live together all year, the rules explained earlier under Parents are divorced apply. Who has free state tax filing Widowed parent remarried. Who has free state tax filing   If a widow or widower remarries, the new spouse is treated as the child's other parent. Who has free state tax filing The rules explained earlier under Custodial parent remarried apply. Who has free state tax filing Parent's Election To Report Child's Interest and Dividends You may be able to elect to include your child's interest and dividend income (including capital gain distributions) on your tax return. Who has free state tax filing If you do, your child will not have to file a return. Who has free state tax filing You can make this election only if all the following conditions are met. Who has free state tax filing Your child was under age 19 (or under age 24 if a full-time student) at the end of the year. Who has free state tax filing Your child had income only from interest and dividends (including capital gain distributions and Alaska Permanent Fund dividends). Who has free state tax filing The child's gross income was less than $10,000. Who has free state tax filing The child is required to file a return unless you make this election. Who has free state tax filing The child does not file a joint return for the year. Who has free state tax filing No estimated tax payment was made for the year, and no overpayment from the previous year (or from any amended return) was applied to this year under your child's name and social security number. Who has free state tax filing No federal income tax was withheld from your child's income under the backup withholding rules. Who has free state tax filing You are the parent whose return must be used when applying the special tax rules for children. Who has free state tax filing (See Which Parent's Return To Use , earlier. Who has free state tax filing ) These conditions are also shown in Figure 1. Who has free state tax filing Certain January 1 birthdays. Who has free state tax filing   A child born on January 1, 1995, is considered to be age 19 at the end of 2013. Who has free state tax filing You cannot make this election for such a child unless the child was a full-time student. Who has free state tax filing   A child born on January 1, 1990, is considered to be age 24 at the end of 2013. Who has free state tax filing You cannot make this election for such a child. Who has free state tax filing How to make the election. Who has free state tax filing    Make the election by attaching Form 8814 to your Form 1040 or Form 1040NR. Who has free state tax filing (If you make this election, you cannot file Form 1040A or Form 1040EZ. Who has free state tax filing ) Attach a separate Form 8814 for each child for whom you make the election. Who has free state tax filing You can make the election for one or more children and not for others. Who has free state tax filing Effect of Making the Election The federal income tax on your child's income may be more if you make the Form 8814 election. Who has free state tax filing Rate may be higher. Who has free state tax filing   If your child received qualified dividends or capital gain distributions, you may pay up to $100 more tax if you make this election instead of filing a separate tax return for the child. Who has free state tax filing This is because the tax rate on the child's income between $1,000 and $2,000 is 10% if you make this election. Who has free state tax filing However, if you file a separate return for the child, the tax rate may be as low as 0% (zero percent) because of the preferential tax rates for qualified dividends and capital gain distributions. Who has free state tax filing Deductions you cannot take. Who has free state tax filing   By making the Form 8814 election, you cannot take any of the following deductions that the child would be entitled to on his or her return. Who has free state tax filing The additional standard deduction if the child is blind. Who has free state tax filing The deduction for a penalty on an early withdrawal of your child's savings. Who has free state tax filing Itemized deductions (such as your child's investment expenses or charitable contributions). Who has free state tax filing Figure 1. Who has free state tax filing Can You Include Your Child's Income On Your Tax Return? Please click here for the text description of the image. Who has free state tax filing Figure 1. Who has free state tax filing Can You Include Your Child's Income On Your Tax Return? Deductible investment interest. Who has free state tax filing   If you use Form 8814, your child's unearned income is considered your unearned income. Who has free state tax filing To figure the limit on your deductible investment interest, add the child's unearned income to yours. Who has free state tax filing However, if your child received qualified dividends, capital gain distributions, or Alaska Permanent Fund dividends, see chapter 3 of Publication 550 for information about how to figure the limit. Who has free state tax filing Alternative minimum tax. Who has free state tax filing    If your child received tax-exempt interest (or exempt-interest dividends paid by a regulated investment company) from certain private activity bonds, you must determine if that interest is a tax preference item for alternative minimum tax (AMT) purposes. Who has free state tax filing If it is, you must include it with your own tax preference items when figuring your AMT. Who has free state tax filing See Form 6251, Alternative Minimum Tax—Individuals, and its instructions for details. Who has free state tax filing Reduced deductions or credits. Who has free state tax filing   If you use Form 8814, your increased adjusted gross income may reduce certain deductions or credits on your return, including the following. Who has free state tax filing Deduction for contributions to a traditional individual retirement arrangement (IRA). Who has free state tax filing Deduction for student loan interest. Who has free state tax filing Itemized deductions for medical expenses, casualty and theft losses, and certain miscellaneous expenses. Who has free state tax filing Credit for child and dependent care expenses. Who has free state tax filing Child tax credit. Who has free state tax filing Education tax credits. Who has free state tax filing Earned income credit. Who has free state tax filing Penalty for underpayment of estimated tax. Who has free state tax filing   If you make this election for 2013 and did not have enough tax withheld or pay enough estimated tax to cover the tax you owe, you may be subject to a penalty. Who has free state tax filing If you plan to make this election for 2014, you may need to increase your federal income tax withholding or your estimated tax payments to avoid the penalty. Who has free state tax filing Get Publication 505 for more information. Who has free state tax filing Figuring Child's Income Use Form 8814, Part I, to figure your child's interest and dividend income to report on your return. Who has free state tax filing Only the amount over $2,000 is added to your income. Who has free state tax filing The amount over $2,000 is shown on Form 8814, line 6. Who has free state tax filing Unless the child's income includes qualified dividends or capital gain distributions (discussed next), the same amount is shown on Form 8814, line 12. Who has free state tax filing Include the amount from Form 8814, line 12, on Form 1040 or Form 1040NR, line 21. Who has free state tax filing If you file more than one Form 8814, include the total amounts from line 12 of all your Forms 8814 on Form 1040 or Form 1040NR, line 21. Who has free state tax filing On the dotted line next to line 21, enter “Form 8814” and the total of the Form 8814, line 12 amounts. Who has free state tax filing Note. Who has free state tax filing The tax on the first $2,000 is figured on Form 8814, Part II. Who has free state tax filing See Figuring Additional Tax , later. Who has free state tax filing Qualified dividends. Who has free state tax filing   Enter on Form 8814, line 2a, any ordinary dividends your child received. Who has free state tax filing This amount may include qualified dividends. Who has free state tax filing Qualified dividends are those dividends reported on Form 1040, line 9b, or Form 1040NR, line 10b, and are eligible for lower tax rates that apply to a net capital gain. Who has free state tax filing For detailed information about qualified dividends, see Publication 550. Who has free state tax filing   If your child received qualified dividends, the amount of these dividends that is added to your income must be reported on Form 1040, lines 9a and 9b, or Form 1040NR, lines 10a and 10b. Who has free state tax filing You do not include these dividends on Form 8814, line 12, or on line 21 of Form 1040 or Form 1040NR. Who has free state tax filing   Enter the child's qualified dividends on Form 8814, line 2b. Who has free state tax filing But do not include this amount on Form 1040, lines 9a and 9b, or Form 1040NR, lines 10a and 10b. Who has free state tax filing Instead, include the amount from Form 8814, line 9, on Form 1040, lines 9a and 9b, or Form 1040NR, lines 10a and 10b. Who has free state tax filing (The amount on Form 8814, line 9, may be less than the amount on Form 8814, line 2b, because lines 7 through 12 of the form divide the $2,000 base amount on Form 8814, line 5, between the child's qualified dividends, capital gain distributions, and other interest and dividend income, reducing each of those amounts. Who has free state tax filing ) Capital gain distributions. Who has free state tax filing   Enter on Form 8814, line 3, any capital gain distributions your child received. Who has free state tax filing The amount of these distributions that is added to your income must be reported on Schedule D (Form 1040), line 13, or, if you are not required to file Schedule D, on Form 1040, line 13, or Form 1040NR, line 14. Who has free state tax filing You do not include it on Form 8814, line 12, or on line 21 of Form 1040 or Form 1040NR. Who has free state tax filing   Include the amount from Form 8814, line 10, on Schedule D, line 13; Form 1040, line 13; or Form 1040NR, line 14, whichever applies. Who has free state tax filing (The amount on Form 8814, line 10, may be less than the amount on Form 8814, line 3, because lines 7 through 12 of the form divide the $2,000 base amount on Form 8814, line 5, between the child's qualified dividends, capital gain distributions, and other interest and dividend income, reducing each of those amounts. Who has free state tax filing ) Collectibles (28% rate) gain. Who has free state tax filing    If any of the child's capital gain distributions are reported on Form 1099-DIV as collectibles (28% rate) gain, you must determine how much to also include on line 4 of the 28% Rate Gain Worksheet, in the instructions for Schedule D, line 18. Who has free state tax filing Multiply the child's capital gain distribution included on Schedule D, line 13, by a fraction. Who has free state tax filing The numerator is the part of the child's total capital gain distribution that is collectibles (28% rate) gain. Who has free state tax filing The denominator is the child's total capital gain distribution. Who has free state tax filing Enter the result on line 4 of the 28% Rate Gain Worksheet. Who has free state tax filing Unrecaptured section 1250 gain. Who has free state tax filing   If any of the child's capital gain distributions are reported on Form 1099-DIV as unrecaptured section 1250 gain, you must determine how much to include on line 11 of the Unrecaptured Section 1250 Gain Worksheet in the instructions for Schedule D, line 19. Who has free state tax filing Multiply the child's capital gain distribution included on Schedule D, line 13, by a fraction. Who has free state tax filing The numerator is the part of the child's total capital gain distribution that is unrecaptured section 1250 gain. Who has free state tax filing The denominator is the child's total capital gain distribution. Who has free state tax filing Enter the result on the Unrecaptured Section 1250 Gain Worksheet, line 11. Who has free state tax filing Section 1202 gain. Who has free state tax filing   If any of the child's capital gain distributions are reported as section 1202 gain (gain on qualified small business stock) on Form 1099-DIV, part or all of that gain may be eligible for the section 1202 exclusion. Who has free state tax filing (For information about the exclusion, see chapter 4 of Publication 550. Who has free state tax filing ) To figure that part, multiply the child's capital gain distribution included on Schedule D, line 13, by a fraction. Who has free state tax filing The numerator is the part of the child's total capital gain distribution that is section 1202 gain. Who has free state tax filing The denominator is the child's total capital gain distribution. Who has free state tax filing Your section 1202 exclusion is generally 50% of the result, but may be subject to a limit. Who has free state tax filing In some cases, the exclusion is more than 50%. Who has free state tax filing See the instructions for Schedule D for details and information on how to report the exclusion amount. Who has free state tax filing Example. Who has free state tax filing Fred is 6 years old. Who has free state tax filing In 2013, he received dividend income of $2,100, which included $1,575 of ordinary dividends and a $525 capital gain distribution from a mutual fund. Who has free state tax filing (None of the distributions were reported on Form 1099-DIV as unrecaptured section 1250 gain, section 1202 gain, or collectibles (28% rate) gain. Who has free state tax filing ) All of the ordinary dividends are qualified dividends. Who has free state tax filing He has no other income and is not subject to backup withholding. Who has free state tax filing No estimated tax payments were made under his name and social security number. Who has free state tax filing Fred's parents elect to include Fred's income on their tax return instead of filing a return for him. Who has free state tax filing They figure the amount to report on Form 1040, lines 9a and 9b, the amount to report on their Schedule D, line 13, and the amount to report on Form 1040, line 21, as follows. Who has free state tax filing They leave lines 1a and 1b of Form 8814 blank because Fred does not have any interest income. Who has free state tax filing They enter his ordinary dividends of $1,575 on lines 2a and 2b because all of Fred's ordinary dividends are qualified dividends. Who has free state tax filing They enter the amount of Fred's capital gain distributions, $525, on line 3. Who has free state tax filing Next, they add the amounts on lines 1a, 2a, and 3 and enter the result, $2,100, on line 4. Who has free state tax filing They subtract the base amount on line 5, $2,000, from the amount on line 4, $2,100, and enter the result, $100, on line 6. Who has free state tax filing This is the total amount from Form 8814 to be reported on their return. Who has free state tax filing Next, they figure how much of this amount is qualified dividends and how much is capital gain distributions. Who has free state tax filing They divide the amount on line 2b, $1,575, by the amount on line 4, $2,100. Who has free state tax filing They enter the result, . Who has free state tax filing 75, on line 7. Who has free state tax filing They divide the amount on line 3, $525, by the amount on line 4, $2,100. Who has free state tax filing They enter the result, . Who has free state tax filing 25, on line 8. Who has free state tax filing They multiply the amount on line 6, $100, by the decimal on line 7, . Who has free state tax filing 75, and enter the result, $75, on line 9. Who has free state tax filing They multiply the amount on line 6, $100, by the decimal on line 8, . Who has free state tax filing 25, and enter the result, $25, on line 10. Who has free state tax filing They include the amount from line 9, $75, on lines 9a and 9b of their Form 1040 and enter “Form 8814 – $75” on the dotted lines next to lines 9a and 9b. Who has free state tax filing They include the amount from line 10, $25, on line 13 of their Schedule D (Form 1040) and enter “Form 8814 – $25” on the dotted line next to Schedule D, line 13. Who has free state tax filing They enter $100 ($75 + $25) on line 11 and -0- ($100 – $100) on line 12. Who has free state tax filing Because the amount on line 12 is -0-, they do not include any amount from Form 8814 on their Form 1040, line 21. Who has free state tax filing Figuring Additional Tax Use Form 8814, Part II, to figure the tax on the $2,000 of your child's interest and dividends that you do not include in your income. Who has free state tax filing This tax is added to the tax figured on your income. Who has free state tax filing This additional tax is the smaller of: 10% x (your child's gross income − $1,000), or $100. Who has free state tax filing Include the amount from line 15 of all your Forms 8814 in the total on Form 1040, line 44, or Form 1040NR, line 42. Who has free state tax filing Check box a on Form 1040, line 44, or Form 1040NR, line 42. Who has free state tax filing Tax for Certain Children Who Have Unearned Income If a child's interest, dividends, and other unearned income total more than $2,000, part of that income may be taxed at the parent's tax rate instead of the child's tax rate. Who has free state tax filing If the parent does not or cannot choose to include the child's income on the parent's return, use Form 8615 to figure the child's tax. Who has free state tax filing Attach the completed form to the child's Form 1040, Form 1040A, or Form 1040NR. Who has free state tax filing When Form 8615 must be filed. Who has free state tax filing   Form 8615 must be filed for a child if all of the following statements are true. Who has free state tax filing The child's unearned income was more than $2,000. Who has free state tax filing The child is required to file a return for 2013. Who has free state tax filing The child either: Was under age 18 at the end of the year, Was age 18 at the end of the year and did not have earned income that was more than half of his or her support, or Was over age 18 and under age 24 at the end of the year, was a full-time student, and did not have earned income that was more than half of his or her support. Who has free state tax filing At least one of the child's parents was alive at the end of 2013. Who has free state tax filing The child does not file a joint return for 2013. Who has free state tax filing These conditions are also shown in Figure 2. Who has free state tax filing Certain January 1 birthdays. Who has free state tax filing   Use the following chart to determine whether certain children with January 1 birthdays meet condition 3 under When Form 8615 must be filed. Who has free state tax filing IF a child was born on. Who has free state tax filing . Who has free state tax filing . Who has free state tax filing THEN, at the end of 2013, the child is considered to be. Who has free state tax filing . Who has free state tax filing . Who has free state tax filing January 1, 1996 18* January 1, 1995 19** January 1, 1990 24*** *This child is not under age 18. Who has free state tax filing The child meets condition 3 only if the child did not have earned income that was more than half of the child's support. Who has free state tax filing  **This child meets condition 3 only if the child was a full-time student who did not have earned income that was more than half of the child's support. Who has free state tax filing  ***Do not use Form 8615 for this child. Who has free state tax filing Figure 2. Who has free state tax filing Do You Have To Use Form 8615 To Figure Your Child's Tax? Please click here for the text description of the image. Who has free state tax filing Figure 2. Who has free state tax filing Do You Have To Use Form 8615 To Figure Your Child's Tax? Providing Parental Information (Form 8615, Lines A–C) On Form 8615, lines A and B, enter the parent's name and social security number. Who has free state tax filing (If the parents filed a joint return, enter the name and social security number listed first on the joint return. Who has free state tax filing ) On line C, check the box for the parent's filing status. Who has free state tax filing See Which Parent's Return To Use, earlier, for information on which parent's return information must be used on Form 8615. Who has free state tax filing Parent with different tax year. Who has free state tax filing   If the parent and the child do not have the same tax year, complete Form 8615 using the information on the parent's return for the tax year that ends in the child's tax year. Who has free state tax filing Example. Who has free state tax filing Kimberly must use her mother's tax and taxable income to complete her Form 8615 for calendar year 2013 (January 1 – December 31). Who has free state tax filing Kimberly's mother files her tax return on a fiscal year basis (July 1 – June 30). Who has free state tax filing Kimberly must use the information on her mother's return for the tax year ending June 30, 2013, to complete her 2013 Form 8615. Who has free state tax filing Parent's return information not known timely. Who has free state tax filing   If the information needed from the parent's return is not known by the time the child's return is due (usually April 15), you can file the return using estimates. Who has free state tax filing   You can use any reasonable estimate. Who has free state tax filing This includes using information from last year's return. Who has free state tax filing If you use an estimated amount on Form 8615, enter “Estimated” on the line next to the amount. Who has free state tax filing   When you get the correct information, file an amended return on Form 1040X, Amended U. Who has free state tax filing S. Who has free state tax filing Individual Income Tax Return. Who has free state tax filing Extension of time to file. Who has free state tax filing   Instead of using estimates, you can get an automatic 6-month extension of time to file if, by the date your return is due, you file Form 4868, Application for Automatic Extension of Time To File U. Who has free state tax filing S. Who has free state tax filing Individual Income Tax Return. Who has free state tax filing See the instructions for Form 4868 for details. Who has free state tax filing    An extension of time to file is not an extension of time to pay. Who has free state tax filing You must make an accurate estimate of the tax for 2013. Who has free state tax filing If you do not pay the full amount due by the regular due date, the child will owe interest and may also be charged penalties. Who has free state tax filing See Form 4868 and its instructions. Who has free state tax filing Parent's return information not available. Who has free state tax filing   If a child cannot get the required information about his or her parent's tax return, the child (or the child's legal representative) can request the necessary information from the Internal Revenue Service (IRS). Who has free state tax filing How to request. Who has free state tax filing   After the end of the tax year, send a signed, written request for the information to the Internal Revenue Service Center where the parent's return will be filed. Who has free state tax filing (The IRS cannot process a request received before the end of the tax year. Who has free state tax filing )    You should also consider getting an extension of time to file the child's return, because there may be a delay in getting the requested information. Who has free state tax filing   The request must contain all of the following. Who has free state tax filing A statement that you are making the request to comply with section 1(g) of the Internal Revenue Code and that you have tried to get the information from the parent. Who has free state tax filing Proof of the child's age (for example, a copy of the child's birth certificate). Who has free state tax filing Evidence the child has more than $2,000 of unearned income (for example, a copy of the child's prior year tax return or copies of Forms 1099 for the current year). Who has free state tax filing The name, address, social security number (if known), and filing status (if known) of the parent whose information is to be shown on Form 8615. Who has free state tax filing    A child's legal representative making the request should include a copy of his or her Power of Attorney, such as Form 2848, or proof of legal guardianship. Who has free state tax filing Step 1. Who has free state tax filing Figuring the Child's Net Unearned Income (Form 8615, Part I) The first step in figuring a child's tax using Form 8615 is to figure the child's net unearned income. Who has free state tax filing To do that, use Form 8615, Part I. Who has free state tax filing Line 1 (Unearned Income) If the child had no earned income, enter on this line the adjusted gross income shown on the child's return. Who has free state tax filing Adjusted gross income is shown on Form 1040, line 38; Form 1040A, line 22; or Form 1040NR, line 37. Who has free state tax filing Form 1040EZ and Form 1040NR-EZ cannot be used if Form 8615 must be filed. Who has free state tax filing If the child had earned income, figure the amount to enter on Form 8615, line 1, by using the worksheet in the instructions for the form. Who has free state tax filing However, use the following worksheet if: the child has excluded any foreign earned income, deducted a loss from self-employment, or has a net operating loss from another year. Who has free state tax filing Alternate Worksheet for Form 8615, Line 1 A. Who has free state tax filing Enter the amount from the child's Form 1040, line 22, or Form 1040NR, line 23   B. Who has free state tax filing Enter the total of any net loss  from self-employment, any net operating loss deduction, any foreign earned income exclusion, and any foreign housing exclusion from the child's Form 1040 or Form 1040NR. Who has free state tax filing Enter this total as a positive number (greater than zero)   C. Who has free state tax filing Add line A and line B and  enter the total   D. Who has free state tax filing Enter the child's earned income plus any amount from the child's Form 1040, line 30, or the child's Form 1040NR, line 30     Generally, the child's earned income is the total of the amounts reported on Form 1040, lines 7, 12, and 18 (if line 12 or 18 is a loss, use zero) or Form 1040NR, lines 8, 13, and 19 (if line 13 or 19 is a loss, use zero)   E. Who has free state tax filing Subtract line D from line C. Who has free state tax filing Enter the result here and on Form 8615, line 1   Unearned income defined. Who has free state tax filing   Unearned income is generally all income other than salaries, wages, and other amounts received as pay for work actually performed. Who has free state tax filing It includes taxable interest, dividends, capital gains (including capital gain distributions), the taxable part of social security and pension payments, certain distributions from trusts, and unemployment compensation. Who has free state tax filing Unearned income includes amounts produced by assets the child obtained with earned income (such as interest on a savings account into which the child deposited wages). Who has free state tax filing Nontaxable income. Who has free state tax filing   For this purpose, unearned income includes only amounts the child must include in gross income. Who has free state tax filing Nontaxable unearned income, such as tax-exempt interest and the nontaxable part of social security and pension payments, is not included. Who has free state tax filing Capital loss. Who has free state tax filing   A child's capital losses are taken into account in figuring the child's unearned income. Who has free state tax filing Capital losses are first applied against capital gains. Who has free state tax filing If the capital losses are more than the capital gains, the difference (up to $3,000) is subtracted from the child's interest, dividends, and other unearned income. Who has free state tax filing Any difference over $3,000 is carried to the next year. Who has free state tax filing Income from property received as a gift. Who has free state tax filing   A child's unearned income includes all income produced by property belonging to the child. Who has free state tax filing This is true even if the property was transferred to the child, regardless of when the property was transferred or purchased or who transferred it. Who has free state tax filing   A child's unearned income includes income produced by property given as a gift to the child. Who has free state tax filing This includes gifts to the child from grandparents or any other person and gifts made under the Uniform Gift to Minors Act. Who has free state tax filing Example. Who has free state tax filing Amanda Black, age 13, received the following income. Who has free state tax filing Dividends—$800 Wages—$2,100 Taxable interest—$1,200 Tax-exempt interest—$100 Capital gains—$300 Capital losses—($200) The dividends were qualified dividends on stock given to her by her grandparents. Who has free state tax filing Amanda's unearned income is $2,100. Who has free state tax filing This is the total of the dividends ($800), taxable interest ($1,200), and capital gains reduced by capital losses ($300 − $200 = $100). Who has free state tax filing Her wages are earned (not unearned) income because they are received for work actually performed. Who has free state tax filing Her tax-exempt interest is not included because it is nontaxable. Who has free state tax filing Trust income. Who has free state tax filing   If a child is the beneficiary of a trust, distributions of taxable interest, dividends, capital gains, and other unearned income from the trust are unearned income to the child. Who has free state tax filing   However, taxable distributions from a qualified disability trust are considered earned income for the purposes of completing Form 8615. Who has free state tax filing See the Form 8615 instructions for details. Who has free state tax filing Adjustment to income. Who has free state tax filing   In figuring the amount to enter on line 1, the child's unearned income is reduced by any penalty on the early withdrawal of savings. Who has free state tax filing Line 2 (Deductions) If the child does not itemize deductions on Schedule A (Form 1040 or Form 1040NR), enter $2,000 on line 2. Who has free state tax filing If the child itemizes deductions, enter on line 2 the larger of: $1,000 plus the portion of the child's itemized deductions on Schedule A (Form 1040), line 29 (or Schedule A (Form 1040NR), line 15), that are directly connected with the production of the unearned income entered on line 1, or $2,000. Who has free state tax filing Directly connected. Who has free state tax filing   Itemized deductions are directly connected with the production of unearned income if they are for expenses paid to produce or collect taxable income or to manage, conserve, or maintain property held for producing income. Who has free state tax filing These expenses include custodian fees and service charges, service fees to collect taxable interest and dividends, and certain investment counsel fees. Who has free state tax filing    These expenses are added to certain other miscellaneous itemized deductions on Schedule A (Form 1040). Who has free state tax filing Only the amount greater than 2% of the child's adjusted gross income can be deducted. Who has free state tax filing See Publication 529, Miscellaneous Deductions, for more information. Who has free state tax filing Example 1. Who has free state tax filing Roger, age 12, has unearned income of $8,000, no other income, no adjustments to income, and itemized deductions of $300 (net of the 2%-of-adjusted-gross-income limit) that are directly connected with his unearned income. Who has free state tax filing His adjusted gross income is $8,000, which is entered on Form 1040, line 38, and on Form 8615, line 1. Who has free state tax filing Roger enters $2,000 on line 2 because that is more than the total of $1,000 plus his directly-connected itemized deductions of $300. Who has free state tax filing Example 2. Who has free state tax filing Eleanor, age 8, has unearned income of $16,000 and an early withdrawal penalty of $100. Who has free state tax filing She has no other income. Who has free state tax filing She has itemized deductions of $1,050 (net of the 2%-of-adjusted-gross-income limit) that are directly connected with the production of her unearned income. Who has free state tax filing Her adjusted gross income, entered on line 1, is $15,900 ($16,000 − $100). Who has free state tax filing The amount on line 2 is $2,050. Who has free state tax filing This is the larger of: $1,000 plus the $1,050 of directly connected itemized deductions, or $2,000. Who has free state tax filing Line 3 Subtract line 2 from line 1 and enter the result on this line. Who has free state tax filing If zero or less, do not complete the rest of the form. Who has free state tax filing However, you must still attach Form 8615 to the child's tax return. Who has free state tax filing Figure the tax on the child's taxable income in the normal manner. Who has free state tax filing Line 4 (Child's Taxable Income) Enter on line 4 the child's taxable income from Form 1040, line 43; Form 1040A, line 27; or Form 1040NR, line 41. Who has free state tax filing Child files Form 2555 or 2555-EZ. Who has free state tax filing   If the child files Form 2555 or 2555-EZ to claim the foreign earned income exclusion, housing exclusion, or housing deduction, the Foreign Earned Income Tax Worksheet (in the Form 1040 instructions) is used to figure the child's tax. Who has free state tax filing Enter the amount from line 3 of the Foreign Earned Income Tax Worksheet as the child's taxable income on Form 8615, line 4. Who has free state tax filing Line 5 (Net Unearned Income) A child's net unearned income cannot be more than his or her taxable income. Who has free state tax filing Enter on Form 8615, line 5, the smaller of line 3 or line 4. Who has free state tax filing This is the child's net unearned income. Who has free state tax filing If zero or less, do not complete the rest of the form. Who has free state tax filing However, you must still attach Form 8615 to the child's tax return. Who has free state tax filing Figure the tax on the child's taxable income in the normal manner. Who has free state tax filing Step 2. Who has free state tax filing Figuring a Tentative Tax at the Parent's Tax Rate (Form 8615, Part II) The next step in completing Form 8615 is to figure a tentative tax on the child's net unearned income at the parent's tax rate. Who has free state tax filing The tentative tax at the parent's tax rate is the difference between the tax on the parent's taxable income figured with the child's net unearned income (plus the net unearned income of any other child whose Form 8615 includes the tax return information of that parent) and the tax figured without it. Who has free state tax filing When figuring the tentative tax at the parent's tax rate on Form 8615, do not refigure any of the exclusions, deductions, or credits on the parent's return because of the child's net unearned income. Who has free state tax filing For example, do not refigure the medical expense deduction. Who has free state tax filing Figure the tentative tax on Form 8615, lines 6 through 13. Who has free state tax filing Line 6 (Parent's Taxable Income) Enter on line 6 the amount from the parent's Form 1040, line 43; Form 1040A, line 27; Form 1040EZ, line 6; Form 1040NR, line 41; or Form 1040NR-EZ, line 14. Who has free state tax filing If the parent's taxable income is zero or less, enter zero on line 6. Who has free state tax filing Parent files Form 2555 or 2555-EZ. Who has free state tax filing   If the parent files Form 2555 or 2555-EZ to claim the foreign earned income exclusion, housing exclusion, or housing deduction, the Foreign Earned Income Tax Worksheet in the Form 1040 instructions is used to figure the parent's tax. Who has free state tax filing Enter the amount from line 3 of the Foreign Earned Income Tax Worksheet as the parent's taxable income, on line 6 of Form 8615. Who has free state tax filing Line 7 (Net Unearned Income of Other Children) If the tax return information of the parent is also used on any other child's Form 8615, enter on line 7 the total of the amounts from line 5 of all the other children's Forms 8615. Who has free state tax filing Do not include the amount from line 5 of the Form 8615 being completed. Who has free state tax filing (The term “other child” means any other child whose Form 8615 uses the tax information of the parent identified on Lines A and B of Form 8615. Who has free state tax filing ) Example. Who has free state tax filing Paul and Jane Persimmon have three children, Sharon, Jerry, and Mike, who must attach Form 8615 to their tax returns. Who has free state tax filing The children's net unearned income amounts on line 5 of their Forms 8615 are: Sharon—$800 Jerry—$600 Mike—$1,000 Line 7 of Sharon's Form 8615 will show $1,600, the total of the amounts on line 5 of Jerry's and Mike's Forms 8615. Who has free state tax filing Line 7 of Jerry's Form 8615 will show $1,800 ($800 + $1,000). Who has free state tax filing Line 7 of Mike's Form 8615 will show $1,400 ($800 + $600). Who has free state tax filing Other children's information not available. Who has free state tax filing   If the net unearned income of the other children is not available when the return is due, either file the return using estimates or get an extension of time to file. Who has free state tax filing Estimates and extensions are discussed earlier under Providing Parental Information (Form 8615, Lines A–C) . Who has free state tax filing Line 8 (Parent's Taxable Income Plus Children's Net Unearned Income) Enter on this line the total of lines 5, 6, and 7. Who has free state tax filing You must determine the amount of net capital gain and qualified dividends included on this line before completing Form 8615, line 9. Who has free state tax filing Net capital gain. Who has free state tax filing   Net capital gain is the smaller of the gain, if any, on Schedule D (Form 1040), line 15, or the gain, if any, on Schedule D, line 16. Who has free state tax filing If Schedule D is not required, it is the amount on Form 1040, line 13; Form 1040A, line 10; or Form 1040NR, line 14. Who has free state tax filing Qualified dividends. Who has free state tax filing   Qualified dividends are those dividends reported on line 9b of Form 1040 or Form 1040A, or line 10b of Form 1040NR. Who has free state tax filing Net capital gain and qualified dividends on line 8. Who has free state tax filing   If neither the child, nor the parent, nor any other child has net capital gain, the net capital gain on line 8 is zero. Who has free state tax filing   If neither the child, nor the parent, nor any other child has qualified dividends, the amount of qualified dividends on line 8 is zero. Who has free state tax filing   If the child, parent, or any other child has net capital gain, figure the amount of net capital gain included on line 8 by adding together the net capital gain amounts included on lines 5, 6, and 7 of Form 8615. Who has free state tax filing   If the child, parent, or any other child has qualified dividends, figure the amount of qualified dividends included on line 8 by adding together the qualified dividend amounts included on lines 5, 6, and 7. Who has free state tax filing   Use the instructions for Form 8615, line 8, including the appropriate Line 5 Worksheet, to find these amounts. Who has free state tax filing See the instructions for Form 8615 for more details. Who has free state tax filing Note. Who has free state tax filing The amount of any net capital gain or qualified dividends is not separately reported on line 8. Who has free state tax filing It is  needed, however, when figuring the tax on line 9. Who has free state tax filing Line 9 (Tax on Parent's Taxable Income Plus Children's Net Unearned Income) Figure the tax on the amount on line 8 using the Tax Table, the Tax Computation Worksheet, the Qualified Dividends and Capital Gain Tax Worksheet (in the Form 1040, 1040A, or 1040NR instructions), the Schedule D Tax Worksheet (in the Schedule D instructions), or Schedule J (Form 1040), as follows. Who has free state tax filing If line 8 does not include any net capital gain or qualified dividends, use the Tax Table or Tax Computation Worksheet to figure this tax. Who has free state tax filing But if Schedule J, Income Averaging for Farmers and Fishermen, is used to figure the tax on the parent's return, use it to figure this tax. Who has free state tax filing If line 8 includes any net capital gain or qualified dividends, use the Qualified Dividends and Capital Gain Tax Worksheet to figure this tax. Who has free state tax filing For details, see the instructions for Form 8615, line 9. Who has free state tax filing However, if the child, parent, or any other child has 28% rate gain or unrecaptured section 1250 gain, use the Schedule D Tax Worksheet. Who has free state tax filing But if Schedule J is used to figure the tax on the parent's return, use it to figure this tax. Who has free state tax filing Child files Form 2555 or 2555-EZ. Who has free state tax filing   If line 8 includes any net capital gain or qualified dividends and the child, or any other child filing Form 8615, also files Form 2555 or 2555-EZ, use Using the Schedule D Tax Worksheet for line 9 tax, next, to figure the line 9 tax. Who has free state tax filing Using the Schedule D Tax Worksheet for line 9 tax. Who has free state tax filing    Use the Schedule D Tax Worksheet (in the Schedule D instructions) to figure the line 9 tax on Form 8615 if the child, parent, or any other child has unrecaptured section 1250 gain or 28% rate gain. Who has free state tax filing If you must use the Schedule D Tax Worksheet, first complete any Schedule D and any actual Schedule D Tax Worksheet required for the child, parent, or any other child. Who has free state tax filing Then figure the line 9 tax using another Schedule D Tax Worksheet. Who has free state tax filing (Do not attach this Schedule D Tax Worksheet to the child's return. Who has free state tax filing )   Complete this Schedule D Tax Worksheet as follows. Who has free state tax filing On line 1, enter the amount from Form 8615, line 8. Who has free state tax filing On line 2, enter the qualified dividends included on Form 8615, line 8. Who has free state tax filing (See the earlier discussion for line 8. Who has free state tax filing ) On line 3, enter the total of the amounts, if any, on line 4g of all Forms 4952 filed by the child, parent, or any other child. Who has free state tax filing On line 4, enter the total of the amounts, if any, on line 4e of all Forms 4952 filed by the child, parent, or any other child. Who has free state tax filing If applicable, include instead the smaller amount entered on the dotted line next to line 4e. Who has free state tax filing On lines 5 and 6, follow the worksheet instructions. Who has free state tax filing On line 7, enter the net capital gain included on Form 8615, line 8. Who has free state tax filing (See the earlier discussion for line 8. Who has free state tax filing ) On lines 8 through 10, follow the worksheet instructions. Who has free state tax filing On line 11, enter zero if neither the child, nor the parent, nor any other child has unrecaptured section 1250 gain (Schedule D, line 19) or 28% rate gain (Schedule D, line 18). Who has free state tax filing Otherwise, enter the amount of unrecaptured section 1250 gain and 28% rate gain included in the net capital gain on line 8 of Form 8615. Who has free state tax filing Figure these amounts as explained later under Figuring unrecaptured section 1250 gain (line 11) and Figuring 28% rate gain (line 11). Who has free state tax filing If the Foreign Earned Income Tax Worksheet was used to figure the parent's tax or the tax of any child, go to step 10 below. Who has free state tax filing Otherwise, skip steps 10, 11, and 12 below, and go to step 13. Who has free state tax filing Determine whether there is a line 8 capital gain excess as follows. Who has free state tax filing Add the amounts on line 2 of all Foreign Earned Income Tax Worksheets completed by the parent or any child for whom Form 8615 is filed. Who has free state tax filing (But for each child do not add more than the excess, if any, of the amount on line 5 of the child's Form 8615 over the child's taxable income on Form 1040, line 43; Form 1040A, line 27; or Form 1040NR, line 41. Who has free state tax filing ) Subtract (a) from the amount on line 1 of this Schedule D Tax Worksheet. Who has free state tax filing Subtract (b) from the amount on line 10 of this Schedule D Tax Worksheet. Who has free state tax filing If the result is more than zero, that amount is the line 8 capital gain excess. Who has free state tax filing If the result is zero or less, there is no line 8 capital gain excess. Who has free state tax filing If there is no line 8 capital gain excess, skip step 12 below and go to step 13. Who has free state tax filing If there is a line 8 capital gain excess, complete a second Schedule D Tax Worksheet as instructed above and in step 13, but in its entirety and with the following additional modifications. Who has free state tax filing (These modifications are to be made only for purposes of filling out this additional Schedule D Tax Worksheet. Who has free state tax filing ) Reduce the amount you would otherwise enter on line 9 (but not below zero) by the line 8 capital gain excess. Who has free state tax filing Reduce the amount you would otherwise enter on line 6 (but not below zero) by any of the line 8 capital gain excess not used in (a) above. Who has free state tax filing If the child, parent, or any other child has 28% rate gain, reduce the amount you would otherwise enter on line 8 of Worksheet 1 for Line 11 of the Schedule D Tax Worksheet – 28% Rate Gain (Line 9 Tax), shown later, (but not below zero) by the line 8 capital gain excess, and refigure the amount on line 11 of this Schedule D Tax Worksheet. Who has free state tax filing If the child, parent, or any other child has unrecaptured section 1250 gain, reduce the amount you would otherwise enter on line 8 of Worksheet 2 for Line 11 of the Schedule D Tax Worksheet – Unrecaptured Section 1250 Gain (Line 9 Tax) (but not below zero) by the line 8 capital gain excess not used in 12(c), and refigure the amount on line 11 of this Schedule D Tax Worksheet. Who has free state tax filing Complete lines 12 through 45 following the worksheet instructions. Who has free state tax filing Use the parent's filing status to complete lines 15, 42, and 44. Who has free state tax filing Enter the amount from line 45 of this Schedule D Tax Worksheet on Form 8615, line 9, and check the box on that line
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The Who Has Free State Tax Filing

Who has free state tax filing 33. Who has free state tax filing   Credit for the Elderly or the Disabled Table of Contents Introduction Useful Items - You may want to see: Are You Eligible for the Credit?Qualified Individual Income Limits How to Claim the CreditCredit Figured for You Credit Figured by You Introduction If you qualify, you may be able to reduce the tax you owe by taking the credit for the elderly or the disabled which is figured on Schedule R (Form 1040A or 1040). Who has free state tax filing This chapter explains the following. Who has free state tax filing Who qualifies for the credit for the elderly or the disabled. Who has free state tax filing How to claim the credit. Who has free state tax filing You may be able to take the credit for the elderly or the disabled if: You are age 65 or older at the end of 2013, or You retired on permanent and total disability and have taxable disability income. Who has free state tax filing Useful Items - You may want to see: Publication 524 Credit for the Elderly or the Disabled 554 Tax Guide for Seniors Form (and Instruction) Schedule R (Form 1040A or 1040) Credit for the Elderly or the Disabled Are You Eligible for the Credit? You can take the credit for the elderly or the disabled if you meet both of the following requirements. Who has free state tax filing You are a qualified individual. Who has free state tax filing Your income is not more than certain limits. Who has free state tax filing You can use Figure 33-A and Table 33-1 as guides to see if you are eligible for the credit. Who has free state tax filing Use Figure 33-A first to see if you are a qualified individual. Who has free state tax filing If you are, go to Table 33-1 to make sure your income is not too high to take the credit. Who has free state tax filing You can take the credit only if you file Form 1040 or Form 1040A. Who has free state tax filing You cannot take the credit if you file Form 1040EZ. Who has free state tax filing Qualified Individual You are a qualified individual for this credit if you are a U. Who has free state tax filing S. Who has free state tax filing citizen or resident alien, and either of the following applies. Who has free state tax filing You were age 65 or older at the end of 2013. Who has free state tax filing You were under age 65 at the end of 2013 and all three of the following statements are true. Who has free state tax filing You retired on permanent and total disability (explained later). Who has free state tax filing You received taxable disability income for 2013. Who has free state tax filing On January 1, 2013, you had not reached mandatory retirement age (defined later under Disability income ). Who has free state tax filing Age 65. Who has free state tax filing   You are considered to be age 65 on the day before your 65th birthday. Who has free state tax filing Therefore, if you were born on January 1, 1949, you are considered to be age 65 at the end of 2013. Who has free state tax filing U. Who has free state tax filing S. Who has free state tax filing Citizen or Resident Alien You must be a U. Who has free state tax filing S. Who has free state tax filing citizen or resident alien (or be treated as a resident alien) to take the credit. Who has free state tax filing Generally, you cannot take the credit if you were a nonresident alien at any time during the tax year. Who has free state tax filing Exceptions. Who has free state tax filing   You may be able to take the credit if you are a nonresident alien who is married to a U. Who has free state tax filing S. Who has free state tax filing citizen or resident alien at the end of the tax year and you and your spouse choose to treat you as a U. Who has free state tax filing S. Who has free state tax filing resident alien. Who has free state tax filing If you make that choice, both you and your spouse are taxed on your worldwide incomes. Who has free state tax filing If you were a nonresident alien at the beginning of the year and a resident alien at the end of the year, and you were married to a U. Who has free state tax filing S. Who has free state tax filing citizen or resident alien at the end of the year, you may be able to choose to be treated as a U. Who has free state tax filing S. Who has free state tax filing resident alien for the entire year. Who has free state tax filing In that case, you may be allowed to take the credit. Who has free state tax filing For information on these choices, see chapter 1 of Publication 519, U. Who has free state tax filing S. Who has free state tax filing Tax Guide for Aliens. Who has free state tax filing Married Persons Generally, if you are married at the end of the tax year, you and your spouse must file a joint return to take the credit. Who has free state tax filing However, if you and your spouse did not live in the same household at any time during the tax year, you can file either a joint return or separate returns and still take the credit. Who has free state tax filing Head of household. Who has free state tax filing   You can file as head of household and qualify to take the credit, even if your spouse lived with you during the first 6 months of the year, if you meet certain tests. Who has free state tax filing See Head of Household in chapter 2 for the tests you must meet. Who has free state tax filing Under Age 65 If you are under age 65 at the end of 2013, you can qualify for the credit only if you are retired on permanent and total disability (discussed next) and have taxable disability income (discussed later under Disability income ). Who has free state tax filing You are retired on permanent and total disability if: You were permanently and totally disabled when you retired, and You retired on disability before the close of the tax year. Who has free state tax filing Even if you do not retire formally, you may be considered retired on disability when you have stopped working because of your disability. Who has free state tax filing If you retired on disability before 1977, and were not permanently and totally disabled at the time, you can qualify for the credit if you were permanently and totally disabled on January 1, 1976, or January 1, 1977. Who has free state tax filing Permanent and total disability. Who has free state tax filing    You are permanently and totally disabled if you cannot engage in any substantial gainful activity because of your physical or mental condition. Who has free state tax filing A qualified physician must certify that the condition has lasted or can be expected to last continuously for 12 months or more, or that the condition can be expected to result in death. Who has free state tax filing See Physician's statement , later. Who has free state tax filing Substantial gainful activity. Who has free state tax filing   Substantial gainful activity is the performance of significant duties over a reasonable period of time while working for pay or profit, or in work generally done for pay or profit. Who has free state tax filing Full-time work (or part-time work done at your employer's convenience) in a competitive work situation for at least the minimum wage conclusively shows that you are able to engage in substantial gainful activity. Who has free state tax filing   Substantial gainful activity is not work you do to take care of yourself or your home. Who has free state tax filing It is not unpaid work on hobbies, institutional therapy or training, school attendance, clubs, social programs, and similar activities. Who has free state tax filing However, doing this kind of work may show that you are able to engage in substantial gainful activity. Who has free state tax filing    The fact that you have not worked for some time is not, of itself, conclusive evidence that you cannot engage in substantial gainful activity. Who has free state tax filing Sheltered employment. Who has free state tax filing   Certain work offered at qualified locations to physically or mentally impaired persons is considered sheltered employment. Who has free state tax filing These qualified locations are in sheltered workshops, hospitals, and similar institutions, homebound programs, and Department of Veterans Affairs (VA) sponsored homes. Who has free state tax filing   Compared to commercial employment, pay is lower for sheltered employment. Who has free state tax filing Therefore, one usually does not look for sheltered employment if he or she can get other employment. Who has free state tax filing The fact that one has accepted sheltered employment is not proof of the person's ability to engage in substantial gainful activity. Who has free state tax filing Physician's statement. Who has free state tax filing   If you are under age 65, you must have your physician complete a statement certifying that you were permanently and totally disabled on the date you retired. Who has free state tax filing You can use the statement in the Instructions for Schedule R. Who has free state tax filing    Figure 33-A. Who has free state tax filing Are You a Qualified Individual? This image is too large to be displayed in the current screen. Who has free state tax filing Please click the link to view the image. Who has free state tax filing Figure 33-A Are You a Qualified Individual?   You do not have to file this statement with your Form 1040 or Form 1040A, but you must keep it for your records. Who has free state tax filing Veterans. Who has free state tax filing   If the Department of Veterans Affairs (VA) certifies that you are permanently and totally disabled, you can substitute VA Form 21-0172, Certification of Permanent and Total Disability, for the physician's statement you are required to keep. Who has free state tax filing VA Form 21-0172 must be signed by a person authorized by the VA to do so. Who has free state tax filing You can get this form from your local VA regional office. Who has free state tax filing Physician's statement obtained in earlier year. Who has free state tax filing   If you got a physician's statement in an earlier year and, due to your continued disabled condition, you were unable to engage in any substantial gainful activity during 2013, you may not need to get another physician's statement for 2013. Who has free state tax filing For a detailed explanation of the conditions you must meet, see the instructions for Schedule R, Part II. Who has free state tax filing If you meet the required conditions, check the box on your Schedule R, Part II, line 2. Who has free state tax filing   If you checked box 4, 5, or 6 in Part I of Schedule R, enter in the space above the box on line 2 in Part II the first name(s) of the spouse(s) for whom the box is checked. Who has free state tax filing Table 33-1. Who has free state tax filing Income Limits IF your filing status is . Who has free state tax filing . Who has free state tax filing . Who has free state tax filing THEN, even if you qualify (see Figure 33-A ), you CANNOT take the credit if. Who has free state tax filing . Who has free state tax filing . Who has free state tax filing   Your adjusted gross income (AGI)* is equal to or more than. Who has free state tax filing . Who has free state tax filing . Who has free state tax filing     OR the total of your nontaxable social security and other nontaxable pension(s), annuities, or disability income is equal to or more than. Who has free state tax filing . Who has free state tax filing . Who has free state tax filing   single, head of household, or qualifying widow(er) with dependent child   $17,500     $5,000   married filing jointly and only one spouse qualifies in Figure 33-A   $20,000     $5,000   married filing jointly and both spouses qualify in Figure 33-A   $25,000     $7,500   married filing separately and you lived apart from your spouse for all of 2013   $12,500     $3,750   * AGI is the amount on Form 1040A, line 22, or Form 1040, line 38. Who has free state tax filing Disability income. Who has free state tax filing   If you are under age 65, you must also have taxable disability income to qualify for the credit. Who has free state tax filing Disability income must meet both of the following requirements. Who has free state tax filing It must be paid under your employer's accident or health plan or pension plan. Who has free state tax filing It must be included in your income as wages (or payments instead of wages) for the time you are absent from work because of permanent and total disability. Who has free state tax filing Payments that are not disability income. Who has free state tax filing   Any payment you receive from a plan that does not provide for disability retirement is not disability income. Who has free state tax filing Any lump-sum payment for accrued annual leave that you receive when you retire on disability is a salary payment and is not disability income. Who has free state tax filing   For purposes of the credit for the elderly or the disabled, disability income does not include amounts you receive after you reach mandatory retirement age. Who has free state tax filing Mandatory retirement age is the age set by your employer at which you would have had to retire, had you not become disabled. Who has free state tax filing Income Limits To determine if you can claim the credit, you must consider two income limits. Who has free state tax filing The first limit is the amount of your adjusted gross income (AGI). Who has free state tax filing The second limit is the amount of nontaxable social security and other nontaxable pensions, annuities, or disability income you received. Who has free state tax filing The limits are shown in Table 33-1. Who has free state tax filing If your AGI and nontaxable pensions, annuities, or disability income are less than the income limits, you may be able to claim the credit. Who has free state tax filing See How to Claim the Credit , later. Who has free state tax filing If either your AGI or your nontaxable pensions, annuities, or disability income are equal to or more than the income limits, you cannot take the credit. Who has free state tax filing How to Claim the Credit You can figure the credit yourself or the Internal Revenue Service will figure it for you. Who has free state tax filing Credit Figured for You If you choose to have the IRS figure the credit for you, read the following discussion for the form you will file (Form 1040 or 1040A). Who has free state tax filing If you want the IRS to figure your tax, see chapter 30. Who has free state tax filing Form 1040. Who has free state tax filing   If you want the IRS to figure your credit, see Form 1040 Line Entries under Tax Figured by IRS in chapter 30. Who has free state tax filing Form 1040A. Who has free state tax filing   If you want the IRS to figure your credit, see Form 1040A Line Entries under Tax Figured by IRS in chapter 30. Who has free state tax filing Credit Figured by You If you choose to figure the credit yourself, fill out the front of Schedule R. Who has free state tax filing Next, fill out Schedule R, Part III. Who has free state tax filing If you file Form 1040A, enter the amount from Schedule R, line 22, on Form 1040A, line 30. Who has free state tax filing If you file Form 1040, include the amount from Schedule R, line 22, on line 53; check box c, and enter “Sch R” on the line next to that box. Who has free state tax filing For a step-by-step discussion about filling out Part III of Schedule R, see Figuring the Credit Yourself in Publication 524. Who has free state tax filing Limit on credit. Who has free state tax filing   The amount of the credit you can claim is generally limited to the amount of your tax. Who has free state tax filing Use the Credit Limit Worksheet in the Instructions for Schedule R to determine if your credit is limited. Who has free state tax filing Prev  Up  Next   Home   More Online Publications