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1040ez 2010printable Tax Forms

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1040ez 2010printable Tax Forms

1040ez 2010printable tax forms Index A Abatement of interest and penalties, Abatement of interest and penalties. 1040ez 2010printable tax forms Accidents, Deductible losses. 1040ez 2010printable tax forms , Nondeductible losses. 1040ez 2010printable tax forms Adjusted basis, Adjusted Basis Adjustments to basis, Basis adjustment to corporation's property. 1040ez 2010printable tax forms , Adjustments to Basis Amended returns, Amended return. 1040ez 2010printable tax forms Appraisals, Appraisal. 1040ez 2010printable tax forms , Costs of photographs and appraisals. 1040ez 2010printable tax forms Assistance (see Tax help) B Bad debts, Nonbusiness bad debt. 1040ez 2010printable tax forms Basis Adjusted, Adjusted Basis Adjustments to, Basis adjustment to corporation's property. 1040ez 2010printable tax forms , Adjustments to Basis Replacement property, Basis of replacement property. 1040ez 2010printable tax forms Business or income-producing property, Business or income-producing property. 1040ez 2010printable tax forms Business purposes, property used partly for, Property used partly for business and partly for personal purposes. 1040ez 2010printable tax forms C Cars Accidents, Deductible losses. 1040ez 2010printable tax forms Fair market value of, Car value. 1040ez 2010printable tax forms Cash gifts, Cash gifts. 1040ez 2010printable tax forms Casualty losses, Table 3. 1040ez 2010printable tax forms When To Deduct a Casualty or Theft Loss Deductible losses, Deductible losses. 1040ez 2010printable tax forms Definition, Casualty Deposits, loss on, Casualty loss or ordinary loss. 1040ez 2010printable tax forms Nondeductible losses, Nondeductible losses. 1040ez 2010printable tax forms Progressive deterioration, Progressive deterioration. 1040ez 2010printable tax forms Proof of, Casualty loss proof. 1040ez 2010printable tax forms When to report, Losses. 1040ez 2010printable tax forms Workbooks for listing property, Workbooks for casualties and thefts. 1040ez 2010printable tax forms Clean up costs, Cost of cleaning up or making repairs. 1040ez 2010printable tax forms Condemnation, Condemnations. 1040ez 2010printable tax forms Corrosive drywall, Special Procedure for Damage From Corrosive Drywall Costs Appraisals, Costs of photographs and appraisals. 1040ez 2010printable tax forms Clean up, Cost of cleaning up or making repairs. 1040ez 2010printable tax forms Incidental expenses, Related expenses. 1040ez 2010printable tax forms Landscaping, Landscaping. 1040ez 2010printable tax forms Photographs taken after loss, Costs of photographs and appraisals. 1040ez 2010printable tax forms Protection, Cost of protection. 1040ez 2010printable tax forms Repair, Cost of cleaning up or making repairs. 1040ez 2010printable tax forms Replacement, Replacement cost. 1040ez 2010printable tax forms D Death of taxpayer Postponement of gain, Death of a taxpayer. 1040ez 2010printable tax forms Deductible losses, Deductible losses. 1040ez 2010printable tax forms Deduction limits, Deduction Limits $100 rule, $100 Rule 10% rule, 10% Rule 2% rule, 2% Rule Deposit losses, Mislaid or lost property. 1040ez 2010printable tax forms , Table 3. 1040ez 2010printable tax forms When To Deduct a Casualty or Theft Loss Reporting of (Table 1), Table 1. 1040ez 2010printable tax forms Reporting Loss on Deposits When to report, Loss on deposits. 1040ez 2010printable tax forms Disaster area losses, Lessee's loss. 1040ez 2010printable tax forms Claiming on amended return, Claiming a disaster loss on an amended return. 1040ez 2010printable tax forms Federal loan canceled, Federal loan canceled. 1040ez 2010printable tax forms Federally declared disaster, Business or income-producing property located in a federally declared disaster area. 1040ez 2010printable tax forms , Disaster Area Losses Figuring loss deduction, Figuring the loss deduction. 1040ez 2010printable tax forms Form 1040X, How to report the loss on Form 1040X. 1040ez 2010printable tax forms Home made unsafe, Home made unsafe by disaster. 1040ez 2010printable tax forms How to deduct loss in preceding year, How to deduct your loss in the preceding year. 1040ez 2010printable tax forms Inventory, Disaster loss to inventory. 1040ez 2010printable tax forms Main home rules, Main home in disaster area. 1040ez 2010printable tax forms , Gains. 1040ez 2010printable tax forms Qualified disaster mitigation payments, Qualified disaster mitigation payments. 1040ez 2010printable tax forms Qualified disaster relief payments, Qualified disaster relief payments. 1040ez 2010printable tax forms Records to keep, Records. 1040ez 2010printable tax forms Tax deadlines postponed, Covered disaster area. 1040ez 2010printable tax forms When to deduct, When to deduct the loss. 1040ez 2010printable tax forms Table 3, Table 3. 1040ez 2010printable tax forms When To Deduct a Casualty or Theft Loss Disaster mitigation payments, Qualified disaster mitigation payments. 1040ez 2010printable tax forms Disaster relief grants, Disaster relief. 1040ez 2010printable tax forms Drywall, corrosive, Special Procedure for Damage From Corrosive Drywall Due dates Tax deadlines postponed, Postponed Tax Deadlines E Employer's emergency disaster fund, Employer's emergency disaster fund. 1040ez 2010printable tax forms F Fair market value (FMV) Decline in value of property in or near casualty area, Decline in market value of property in or near casualty area. 1040ez 2010printable tax forms Measuring decrease in, Decrease in Fair Market Value Items not to consider, Figuring Decrease in FMV — Items Not To Consider Items to consider, Figuring Decrease in FMV — Items To Consider Federal disaster relief grants, Federal disaster relief grants. 1040ez 2010printable tax forms Federal Emergency Management Agency (FEMA), contacting, Contacting the Federal Emergency Management Agency (FEMA) Federally declared disasters, Business or income-producing property located in a federally declared disaster area. 1040ez 2010printable tax forms , Disaster Area Losses Figuring gain, Property used partly for business and partly for personal purposes. 1040ez 2010printable tax forms Figuring loss, Theft loss proof. 1040ez 2010printable tax forms , Figuring the Deduction Adjusted basis, Adjusted Basis Disaster area losses, Figuring the loss deduction. 1040ez 2010printable tax forms Insurance and other reimbursements, Insurance and Other Reimbursements Form 1040, Schedule A, Personal-use property. 1040ez 2010printable tax forms Form 1040, Schedule D, Personal-use property. 1040ez 2010printable tax forms Form 1040X Disaster area losses, How to report the loss on Form 1040X. 1040ez 2010printable tax forms Form 4684 Reporting gains and losses on personal-use property, Personal-use property. 1040ez 2010printable tax forms Free tax services, Free help with your tax return. 1040ez 2010printable tax forms G Gains Figuring, Figuring a Gain Postponement of, Postponement of Gain, How To Postpone a Gain Reimbursements, Gain from reimbursement. 1040ez 2010printable tax forms Reporting of, Contacting the Federal Emergency Management Agency (FEMA) When to report, Changing your mind. 1040ez 2010printable tax forms H Help (see Tax help) I Incidental expenses, Related expenses. 1040ez 2010printable tax forms Insurance, Insurance and Other Reimbursements Living expenses, payments for, Insurance payments for living expenses. 1040ez 2010printable tax forms Interest abatement, Abatement of interest and penalties. 1040ez 2010printable tax forms Inventory losses, Loss of inventory. 1040ez 2010printable tax forms Disaster area losses, Disaster loss to inventory. 1040ez 2010printable tax forms L Landscaping, Landscaping. 1040ez 2010printable tax forms Leased property, Leased property. 1040ez 2010printable tax forms When to report, Lessee's loss. 1040ez 2010printable tax forms Losses Casualty (see Casualty losses) Deposits (see Deposit losses) Disaster areas (see Disaster area losses) Figuring amount (see Figuring loss) Proof of, Deducted loss recovered. 1040ez 2010printable tax forms Records of, Theft loss proof. 1040ez 2010printable tax forms Reporting of, Contacting the Federal Emergency Management Agency (FEMA) Theft (see Theft losses) When to report, Changing your mind. 1040ez 2010printable tax forms (Table 3), Table 3. 1040ez 2010printable tax forms When To Deduct a Casualty or Theft Loss M Married taxpayers Deduction limits, Married taxpayers. 1040ez 2010printable tax forms , Married taxpayers. 1040ez 2010printable tax forms Mislaid or lost property, Mislaid or lost property. 1040ez 2010printable tax forms Missing children, photographs of, Reminders N Nonbusiness bad debts, Nonbusiness bad debt. 1040ez 2010printable tax forms Nondeductible losses, Nondeductible losses. 1040ez 2010printable tax forms P Payments for living expenses, Insurance payments for living expenses. 1040ez 2010printable tax forms Penalty abatement, Abatement of interest and penalties. 1040ez 2010printable tax forms Personal property Loss deduction, figuring of, Personal property. 1040ez 2010printable tax forms Personal-use property Reporting gains and losses, Personal-use property. 1040ez 2010printable tax forms Personal-use real property, Exception for personal-use real property. 1040ez 2010printable tax forms Photographs Documentation of loss, Costs of photographs and appraisals. 1040ez 2010printable tax forms Ponzi-type investment schemes, Losses from Ponzi-type investment schemes. 1040ez 2010printable tax forms Postponed tax deadlines, Postponed Tax Deadlines Postponement of gain, Postponement of Gain, How To Postpone a Gain Amended return, Amended return. 1040ez 2010printable tax forms Changing mind, Changing your mind. 1040ez 2010printable tax forms Replacement property acquired after return filed, Replacement property acquired after return filed. 1040ez 2010printable tax forms Replacement property acquired before return filed, Replacement property acquired before return filed. 1040ez 2010printable tax forms Required statement, Required statement. 1040ez 2010printable tax forms Substituting replacement property, Substituting replacement property. 1040ez 2010printable tax forms Three-year limit, Three-year limit. 1040ez 2010printable tax forms Proof of loss, Proof of Loss Protection costs, Cost of protection. 1040ez 2010printable tax forms Publications (see Tax help) R Records of loss, Theft loss proof. 1040ez 2010printable tax forms Recovered stolen property, Recovered stolen property. 1040ez 2010printable tax forms Reimbursements Cash gifts, Cash gifts. 1040ez 2010printable tax forms Disaster relief, Disaster relief. 1040ez 2010printable tax forms Employer's emergency disaster fund, Employer's emergency disaster fund. 1040ez 2010printable tax forms Failure to file a claim, Failure to file a claim for reimbursement. 1040ez 2010printable tax forms Received after deducting loss, Reimbursement Received After Deducting Loss Types of, Types of Reimbursements Related expenses, Related expenses. 1040ez 2010printable tax forms Related person, replacement property bought from, Buying replacement property from a related person. 1040ez 2010printable tax forms Repair costs, Cost of cleaning up or making repairs. 1040ez 2010printable tax forms Replacement cost, Replacement cost. 1040ez 2010printable tax forms Replacement period, Replacement Period Extension of, Extension. 1040ez 2010printable tax forms Replacement property, Replacement Property Advance payment, Advance payment. 1040ez 2010printable tax forms Basis adjustment to corporation's property, Basis adjustment to corporation's property. 1040ez 2010printable tax forms Basis of, Basis of replacement property. 1040ez 2010printable tax forms Main home, Main home replaced. 1040ez 2010printable tax forms In disaster area, Main home in disaster area. 1040ez 2010printable tax forms Postponement of gain, Replacement property acquired before return filed. 1040ez 2010printable tax forms Reporting gains and losses, Reporting a gain. 1040ez 2010printable tax forms , How To Report Gains and Losses Basis, adjustments to, Adjustments to Basis Business and income-producing property, Business and income-producing property. 1040ez 2010printable tax forms Deductions exceeding income, If Deductions Are More Than Income Deposits, How to report. 1040ez 2010printable tax forms Table 1, Table 1. 1040ez 2010printable tax forms Reporting Loss on Deposits Disaster area losses, How to report the loss on Form 1040X. 1040ez 2010printable tax forms Personal-use property, Personal-use property. 1040ez 2010printable tax forms Timing of, When To Report Gains and Losses S Sentimental value, Sentimental value. 1040ez 2010printable tax forms State disaster relief grants for businesses, State disaster relief grants for businesses. 1040ez 2010printable tax forms Stolen property (see Theft losses) T Tables and figures Reporting loss on deposits (Table 1), Table 1. 1040ez 2010printable tax forms Reporting Loss on Deposits When to deduct losses (Table 3), Table 3. 1040ez 2010printable tax forms When To Deduct a Casualty or Theft Loss Tax help, How To Get Tax Help Theft losses, Theft FMV of stolen property, FMV of stolen property. 1040ez 2010printable tax forms Mislaid or lost property, Mislaid or lost property. 1040ez 2010printable tax forms Proof of, Theft loss proof. 1040ez 2010printable tax forms When to deduct (Table 3), Table 3. 1040ez 2010printable tax forms When To Deduct a Casualty or Theft Loss When to report, Losses. 1040ez 2010printable tax forms Workbooks for listing property, Workbooks for casualties and thefts. 1040ez 2010printable tax forms Timber loss, Timber loss. 1040ez 2010printable tax forms W Workbooks for property lost due to casualties and thefts, Workbooks for casualties and thefts. 1040ez 2010printable tax forms Prev  Up     Home   More Online Publications
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EFTPS: The Electronic Federal Tax Payment System

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The Easiest Way to Pay All Your Federal Taxes

EFTPS® is a system for paying federal taxes electronically using the Internet, or by phone using the EFTPS® Voice Response System. EFTPS® is offered free by the U.S. Department of Treasury. Over 12 million taxpayers are currently enrolled in the system. Since EFTPS® began in 1996, there have been over 1.45 billion electronic payments made, totaling over $29.5 trillion!
 


EFTPS® offers ...

  • Security
  • Convenience
  • Accuracy

Security You Can Count On

EFTPS® is a secure government web site that allows users to make federal tax payments electronically. Every user must have a secure Internet browser with 128-bit encryption in order to access the site. To log on to the system, an enrolled user must be authenticated with three pieces of unique information: Taxpayer Identification Number (EIN or SSN), EFTPS® Personal Identification Number (PIN) and an Internet Password. The combination of these three pieces of identification adds to the security of the site and the privacy of taxpayer data.

Convenience at Your Fingertips

  • EFTPS® offers you the convenience and flexibility of making your tax payments via the Internet or phone. You can initiate your tax payment from your home or office, 24/7.

  • Businesses and Individuals can schedule payments up to 365 days in advance. Scheduled payments can be changed or cancelled up to two business days in advance of the scheduled payment date.

  • You can use EFTPS® to make all your federal tax payments, including income, employment, estimated and excise taxes.

  • You can check up to 16 months of your EFTPS® payment history online or by calling EFTPS® Customer Service.

Accuracy You Can Depend On

By 8 p.m. ET at least one calendar day in advance of the due date, submit your payment instructions to EFTPS® to move the funds from your account to the Treasury's account for payment of your federal taxes. Funds will not move from your account until the date you indicate. You will receive an immediate acknowledgement of your payment instructions, and your bank statement will confirm the payment was made. 

EFTPS® Enrollment

To enroll, or for more information on enrollment, visit EFTPS® or call EFTPS® Customer Service to request an enrollment form:

  • 1-800-555-4477 
  • 1-800-733-4829 (TDD Hearing-Impaired)
  • 1-800-244-4829 (Español)

EFTPS Inquiry PIN

Beginning this year, when Payroll Service Providers enroll clients in EFTPS, an EFTPS Inquiry PIN will automatically be sent to the taxpayer.  Taxpayers who have had activity on their EFTPS account over the prior 12 months will also receive Inquiry PINs.  This Inquiry PIN allows the taxpayer access to monitor the EFTPS for transactions made on their behalf.

And there's more...

Tax professionals, accountants, and payroll companies are discovering the added benefits of using EFTPS®.

  • EFTPS® via the Internet or phone - Once enrolled, individual and business taxpayers can use the Internet to make all their federal tax payments via the Internet, or phone using the EFTPS® Voice Response System. Both payment methods are interchangeable. 

  • EFTPS® Batch Provider - Tax professionals/providers can register through this software and send up to 1,000 enrollments and 5,000 payments in one transaction. Users can synchronize enrollments and payments between the software and EFTPS® database in real-time. To download the EFTPS® Batch Provider Software and User's Manual visit EFTPS® and follow these steps:
  1. Click on HELP & INFORMATION
  2. Click on Downloads
  3. Click on Batch Provider Software User's Manual
  4. Click on Software (left side of screen) for additional information

  • EFTPS® Bulk Provider - Designed for payroll processors who initiate frequent payments from and desire automated enrollment through an Electronic Data Interchange (EDI) compatible system.

Additional Information is available in the articles below:

Publication 966 -  The Secure Way to Pay Your Federal Taxes for Businesses and Individuals

Publication 4990 - Tax Payment Instruction Booklet

Link for ordering free EFTPS® Marketing Materials

Electronic Payment Options Home Page

Current scams and phishing sites posing as the IRS

EFTPS® –  Treasury’s free service for paying federal taxes for individuals and businesses



 

Page Last Reviewed or Updated: 17-Mar-2014

The 1040ez 2010printable Tax Forms

1040ez 2010printable tax forms Publication 583 - Main Content Table of Contents What New Business Owners Need To Know Forms of BusinessMore information. 1040ez 2010printable tax forms More information. 1040ez 2010printable tax forms Exception—Community Income. 1040ez 2010printable tax forms Exception—Qualified joint venture. 1040ez 2010printable tax forms More information. 1040ez 2010printable tax forms More information. 1040ez 2010printable tax forms Identification NumbersEmployer Identification Number (EIN) Payee's Identification Number Tax Year Accounting Method Business TaxesIncome Tax Self-Employment Tax Employment Taxes Excise Taxes Depositing Taxes Information Returns PenaltiesWaiver of penalty. 1040ez 2010printable tax forms Business ExpensesBusiness Start-Up Costs Depreciation Business Use of Your Home Car and Truck Expenses RecordkeepingWhy Keep Records? Kinds of Records To Keep How Long To Keep Records Sample Record System How to Get More InformationInternal Revenue Service Small Business Administration Other Federal Agencies What New Business Owners Need To Know As a new business owner, you need to know your federal tax responsibilities. 1040ez 2010printable tax forms Table 1 can help you learn what those responsibilities are. 1040ez 2010printable tax forms Ask yourself each question listed in the table, then see the related discussion to find the answer. 1040ez 2010printable tax forms In addition to knowing about federal taxes, you need to make some basic business decisions. 1040ez 2010printable tax forms Ask yourself: What are my financial resources? What products and services will I sell? How will I market my products and services? How will I develop a strategic business plan? How will I manage my business on a day-to-day basis? How will I recruit employees? The Small Business Administration (SBA) is a federal agency that can help you answer these types of questions. 1040ez 2010printable tax forms For information on how to contact the SBA, see How to Get More Information, later. 1040ez 2010printable tax forms Forms of Business The most common forms of business are the sole proprietorship, partnership, and corporation. 1040ez 2010printable tax forms When beginning a business, you must decide which form of business to use. 1040ez 2010printable tax forms Legal and tax considerations enter into this decision. 1040ez 2010printable tax forms Only tax considerations are discussed in this publication. 1040ez 2010printable tax forms Your form of business determines which income tax return form you have to file. 1040ez 2010printable tax forms See Table 2 to find out which form you have to file. 1040ez 2010printable tax forms Sole proprietorships. 1040ez 2010printable tax forms   A sole proprietorship is an unincorporated business that is owned by one individual. 1040ez 2010printable tax forms It is the simplest form of business organization to start and maintain. 1040ez 2010printable tax forms The business has no existence apart from you, the owner. 1040ez 2010printable tax forms Its liabilities are your personal liabilities. 1040ez 2010printable tax forms You undertake the risks of the business for all assets owned, whether or not used in the business. 1040ez 2010printable tax forms You include the income and expenses of the business on your personal tax return. 1040ez 2010printable tax forms More information. 1040ez 2010printable tax forms   For more information on sole proprietorships, see Publication 334, Tax Guide for Small Business. 1040ez 2010printable tax forms If you are a farmer, see Publication 225, Farmer's Tax Guide. 1040ez 2010printable tax forms Partnerships. 1040ez 2010printable tax forms   A partnership is the relationship existing between two or more persons who join to carry on a trade or business. 1040ez 2010printable tax forms Each person contributes money, property, labor, or skill, and expects to share in the profits and losses of the business. 1040ez 2010printable tax forms   A partnership must file an annual information return to report the income, deductions, gains, losses, etc. 1040ez 2010printable tax forms , from its operations, but it does not pay income tax. 1040ez 2010printable tax forms Instead, it “passes through” any profits or losses to its partners. 1040ez 2010printable tax forms Each partner includes his or her share of the partnership's items on his or her tax return. 1040ez 2010printable tax forms More information. 1040ez 2010printable tax forms   For more information on partnerships, see Publication 541, Partnerships. 1040ez 2010printable tax forms Husband and wife business. 1040ez 2010printable tax forms   If you and your spouse jointly own and operate an unincorporated business and share in the profits and losses, you are partners in a partnership, whether or not you have a formal partnership agreement. 1040ez 2010printable tax forms Do not use Schedule C or C-EZ. 1040ez 2010printable tax forms Instead, file Form 1065, U. 1040ez 2010printable tax forms S. 1040ez 2010printable tax forms Return of Partnership Income. 1040ez 2010printable tax forms For more information, see Publication 541, Partnerships. 1040ez 2010printable tax forms Exception—Community Income. 1040ez 2010printable tax forms   If you and your spouse wholly own an unincorporated business as community property under the community property laws of a state, foreign country, or U. 1040ez 2010printable tax forms S. 1040ez 2010printable tax forms possession, you can treat the business either as a sole proprietorship or a partnership. 1040ez 2010printable tax forms The only states with community property laws are Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin. 1040ez 2010printable tax forms A change in your reporting position will be treated as a conversion of the entity. 1040ez 2010printable tax forms Exception—Qualified joint venture. 1040ez 2010printable tax forms   If you and your spouse each materially participate as the only members of a jointly owned and operated business, and you file a joint return for the tax year, you can make a joint election to be treated as a qualified joint venture instead of a partnership for the tax year. 1040ez 2010printable tax forms Making this election will allow you to avoid the complexity of Form 1065 but still give each spouse credit for social security earnings on which retirement benefits are based. 1040ez 2010printable tax forms For an explanation of "material participation," see the Instructions for Schedule C, line G. 1040ez 2010printable tax forms   To make this election, you must divide all items of income, gain, loss, deduction, and credit attributable to the business between you and your spouse in accordance with your respective interests in the venture. 1040ez 2010printable tax forms Each of you must file a separate Schedule C or C-EZ and a separate Schedule SE. 1040ez 2010printable tax forms For more information, see Qualified Joint Venture in the Instructions for Schedule SE. 1040ez 2010printable tax forms Corporations. 1040ez 2010printable tax forms   In forming a corporation, prospective shareholders exchange money, property, or both, for the corporation's capital stock. 1040ez 2010printable tax forms A corporation generally takes the same deductions as a sole proprietorship to figure its taxable income. 1040ez 2010printable tax forms A corporation can also take special deductions. 1040ez 2010printable tax forms   The profit of a corporation is taxed to the corporation when earned, and then is taxed to the shareholders when distributed as dividends. 1040ez 2010printable tax forms However, shareholders cannot deduct any loss of the corporation. 1040ez 2010printable tax forms More information. 1040ez 2010printable tax forms   For more information on corporations, see Publication 542, Corporations. 1040ez 2010printable tax forms S corporations. 1040ez 2010printable tax forms   An eligible domestic corporation can avoid double taxation (once to the corporation and again to the shareholders) by electing to be treated as an S corporation. 1040ez 2010printable tax forms Generally, an S corporation is exempt from federal income tax other than tax on certain capital gains and passive income. 1040ez 2010printable tax forms On their tax returns, the S corporation's shareholders include their share of the corporation's separately stated items of income, deduction, loss, and credit, and their share of nonseparately stated income or loss. 1040ez 2010printable tax forms More information. 1040ez 2010printable tax forms   For more information on S corporations, see the instructions for Form 2553, Election by a Small Business Corporation, and Form 1120S, U. 1040ez 2010printable tax forms S. 1040ez 2010printable tax forms Income Tax Return for an S Corporation. 1040ez 2010printable tax forms Limited liability company. 1040ez 2010printable tax forms   A limited liability company (LLC) is an entity formed under state law by filing articles of organization as an LLC. 1040ez 2010printable tax forms The members of an LLC are not personally liable for its debts. 1040ez 2010printable tax forms An LLC may be classified for federal income tax purposes as either a partnership, a corporation, or an entity disregarded as an entity separate from its owner by applying the rules in regulations section 301. 1040ez 2010printable tax forms 7701-3. 1040ez 2010printable tax forms For more information, see the instructions for Form 8832, Entity Classification Election. 1040ez 2010printable tax forms Identification Numbers You must have a taxpayer identification number so the IRS can process your returns. 1040ez 2010printable tax forms The two most common kinds of taxpayer identification numbers are the social security number (SSN) and the employer identification number (EIN). 1040ez 2010printable tax forms An SSN is issued to individuals by the Social Security Administration (SSA) and is in the following format: 000–00–0000. 1040ez 2010printable tax forms An EIN is issued to individuals (sole proprietors), partnerships, corporations, and other entities by the IRS and is in the following format: 00–0000000. 1040ez 2010printable tax forms You must include your taxpayer identification number (SSN or EIN) on all returns and other documents you send to the IRS. 1040ez 2010printable tax forms You must also furnish your number to other persons who use your identification number on any returns or documents they send to the IRS. 1040ez 2010printable tax forms This includes returns or documents filed to report the following information. 1040ez 2010printable tax forms Interest, dividends, royalties, etc. 1040ez 2010printable tax forms , paid to you. 1040ez 2010printable tax forms Any amount paid to you as a dependent care provider. 1040ez 2010printable tax forms Certain other amounts paid to you that total $600 or more for the year. 1040ez 2010printable tax forms If you do not furnish your identification number as required, you may be subject to penalties. 1040ez 2010printable tax forms See Penalties, later. 1040ez 2010printable tax forms Employer Identification Number (EIN) EINs are used to identify the tax accounts of employers, certain sole proprietors, corporations, partnerships, estates, trusts, and other entities. 1040ez 2010printable tax forms If you don't already have an EIN, you need to get one if you: Have employees, Have a qualified retirement plan, Operate your business as a corporation or partnership, or File returns for: Employment taxes, or Excise taxes. 1040ez 2010printable tax forms Applying for an EIN. 1040ez 2010printable tax forms   You may apply for an EIN: Online—Click on the EIN link at www. 1040ez 2010printable tax forms irs. 1040ez 2010printable tax forms gov/businesses/small. 1040ez 2010printable tax forms The EIN is issued immediately once the application information is validated. 1040ez 2010printable tax forms By telephone at 1-800-829-4933. 1040ez 2010printable tax forms By mailing or faxing Form SS-4, Application for Employer Identification Number. 1040ez 2010printable tax forms When to apply. 1040ez 2010printable tax forms   You should apply for an EIN early enough to receive the number by the time you must file a return or statement or make a tax deposit. 1040ez 2010printable tax forms If you apply by mail, file Form SS-4 at least 4 weeks before you need an EIN. 1040ez 2010printable tax forms If you apply by telephone or through the IRS website, you can get an EIN immediately. 1040ez 2010printable tax forms If you apply by fax, you can get an EIN within 4 business days. 1040ez 2010printable tax forms   If you do not receive your EIN by the time a return is due, file your return anyway. 1040ez 2010printable tax forms Write “Applied for” and the date you applied for the number in the space for the EIN. 1040ez 2010printable tax forms Do not use your social security number as a substitute for an EIN on your tax returns. 1040ez 2010printable tax forms More than one EIN. 1040ez 2010printable tax forms   You should have only one EIN. 1040ez 2010printable tax forms If you have more than one EIN and are not sure which to use, contact the Internal Revenue Service Center where you file your return. 1040ez 2010printable tax forms Give the numbers you have, the name and address to which each was assigned, and the address of your main place of business. 1040ez 2010printable tax forms The IRS will tell you which number to use. 1040ez 2010printable tax forms More information. 1040ez 2010printable tax forms   For more information about EINs, see Publication 1635, Understanding Your EIN. 1040ez 2010printable tax forms Payee's Identification Number In the operation of a business, you will probably make certain payments you must report on information returns (discussed later under Information Returns). 1040ez 2010printable tax forms The forms used to report these payments must include the payee's identification number. 1040ez 2010printable tax forms Employee. 1040ez 2010printable tax forms   If you have employees, you must get an SSN from each of them. 1040ez 2010printable tax forms Record the name and SSN of each employee exactly as they are shown on the employee's social security card. 1040ez 2010printable tax forms If the employee's name is not correct as shown on the card, the employee should request a new card from the SSA. 1040ez 2010printable tax forms This may occur, for example, if the employee's name has changed due to marriage or divorce. 1040ez 2010printable tax forms   If your employee does not have an SSN, he or she should file Form SS-5, Application for a Social Security Card, with the SSA. 1040ez 2010printable tax forms This form is available at SSA offices or by calling 1-800-772-1213. 1040ez 2010printable tax forms It is also available from the SSA website at www. 1040ez 2010printable tax forms ssa. 1040ez 2010printable tax forms gov. 1040ez 2010printable tax forms Other payee. 1040ez 2010printable tax forms   If you make payments to someone who is not your employee and you must report the payments on an information return, get that person's SSN. 1040ez 2010printable tax forms If you make reportable payments to an organization, such as a corporation or partnership, you must get its EIN. 1040ez 2010printable tax forms   To get the payee's SSN or EIN, use Form W-9, Request for Taxpayer Identification Number and Certification. 1040ez 2010printable tax forms This form is available from IRS offices or by calling 1-800-829-3676. 1040ez 2010printable tax forms It is also available from the IRS website at IRS. 1040ez 2010printable tax forms gov. 1040ez 2010printable tax forms    If the payee does not provide you with an identification number, you may have to withhold part of the payments as backup withholding. 1040ez 2010printable tax forms For information on backup withholding, see the Form W-9 instructions and the General Instructions for Certain Information Returns. 1040ez 2010printable tax forms Tax Year You must figure your taxable income and file an income tax return based on an annual accounting period called a tax year. 1040ez 2010printable tax forms A tax year is usually 12 consecutive months. 1040ez 2010printable tax forms There are two kinds of tax years. 1040ez 2010printable tax forms Calendar tax year. 1040ez 2010printable tax forms A calendar tax year is 12 consecutive months beginning January 1 and ending December 31. 1040ez 2010printable tax forms Fiscal tax year. 1040ez 2010printable tax forms A fiscal tax year is 12 consecutive months ending on the last day of any month except December. 1040ez 2010printable tax forms A 52-53-week tax year is a fiscal tax year that varies from 52 to 53 weeks but does not have to end on the last day of a month. 1040ez 2010printable tax forms If you file your first tax return using the calendar tax year and you later begin business as a sole proprietor, become a partner in a partnership, or become a shareholder in an S corporation, you must continue to use the calendar year unless you get IRS approval to change it or are otherwise allowed to change it without IRS approval. 1040ez 2010printable tax forms You must use a calendar tax year if: You keep no books. 1040ez 2010printable tax forms You have no annual accounting period. 1040ez 2010printable tax forms Your present tax year does not qualify as a fiscal year. 1040ez 2010printable tax forms You are required to use a calendar year by a provision of the Internal Revenue Code or the Income Tax Regulations. 1040ez 2010printable tax forms For more information, see Publication 538, Accounting Periods and Methods. 1040ez 2010printable tax forms First-time filer. 1040ez 2010printable tax forms   If you have never filed an income tax return, you can adopt either a calendar tax year or a fiscal tax year. 1040ez 2010printable tax forms You adopt a tax year by filing your first income tax return using that tax year. 1040ez 2010printable tax forms You have not adopted a tax year if you merely did any of the following. 1040ez 2010printable tax forms Filed an application for an extension of time to file an income tax return. 1040ez 2010printable tax forms Filed an application for an employer identification number. 1040ez 2010printable tax forms Paid estimated taxes for that tax year. 1040ez 2010printable tax forms Changing your tax year. 1040ez 2010printable tax forms   Once you have adopted your tax year, you may have to get IRS approval to change it. 1040ez 2010printable tax forms To get approval, you must file Form 1128, Application To Adopt, Change, or Retain a Tax Year. 1040ez 2010printable tax forms You may have to pay a fee. 1040ez 2010printable tax forms For more information, see Publication 538. 1040ez 2010printable tax forms Accounting Method An accounting method is a set of rules used to determine when and how income and expenses are reported. 1040ez 2010printable tax forms You choose an accounting method for your business when you file your first income tax return. 1040ez 2010printable tax forms There are two basic accounting methods. 1040ez 2010printable tax forms Cash method. 1040ez 2010printable tax forms Under the cash method, you report income in the tax year you receive it. 1040ez 2010printable tax forms You usually deduct or capitalize expenses in the tax year you pay them. 1040ez 2010printable tax forms Accrual method. 1040ez 2010printable tax forms Under an accrual method, you generally report income in the tax year you earn it, even though you may receive payment in a later year. 1040ez 2010printable tax forms You deduct or capitalize expenses in the tax year you incur them, whether or not you pay them that year. 1040ez 2010printable tax forms For other methods, see Publication 538. 1040ez 2010printable tax forms If you need inventories to show income correctly, you must generally use an accrual method of accounting for purchases and sales. 1040ez 2010printable tax forms Inventories include goods held for sale in the normal course of business. 1040ez 2010printable tax forms They also include raw materials and supplies that will physically become a part of merchandise intended for sale. 1040ez 2010printable tax forms Inventories are explained in Publication 538. 1040ez 2010printable tax forms Certain small business taxpayers can use the cash method of accounting and can also account for inventoriable items as materials and supplies that are not incidental. 1040ez 2010printable tax forms For more information, see Publication 538. 1040ez 2010printable tax forms You must use the same accounting method to figure your taxable income and to keep your books. 1040ez 2010printable tax forms Also, you must use an accounting method that clearly shows your income. 1040ez 2010printable tax forms In general, any accounting method that consistently uses accounting principles suitable for your trade or business clearly shows income. 1040ez 2010printable tax forms An accounting method clearly shows income only if it treats all items of gross income and expense the same from year to year. 1040ez 2010printable tax forms More than one business. 1040ez 2010printable tax forms   When you own more than one business, you can use a different accounting method for each business if the method you use for each clearly shows your income. 1040ez 2010printable tax forms You must keep a complete and separate set of books and records for each business. 1040ez 2010printable tax forms Changing your method of accounting. 1040ez 2010printable tax forms   Once you have set up your accounting method, you must generally get IRS approval before you can change to another method. 1040ez 2010printable tax forms A change in accounting method not only includes a change in your overall system of accounting, but also a change in the treatment of any material item. 1040ez 2010printable tax forms For examples of changes that require approval and information on how to get approval for the change, see Publication 538. 1040ez 2010printable tax forms Business Taxes The form of business you operate determines what taxes you must pay and how you pay them. 1040ez 2010printable tax forms The following are the four general kinds of business taxes. 1040ez 2010printable tax forms Income tax. 1040ez 2010printable tax forms Self-employment tax. 1040ez 2010printable tax forms Employment taxes. 1040ez 2010printable tax forms Excise taxes. 1040ez 2010printable tax forms See Table 2 for the forms you file to report these taxes. 1040ez 2010printable tax forms You may want to get Publication 509. 1040ez 2010printable tax forms It has tax calendars that tell you when to file returns and make tax payments. 1040ez 2010printable tax forms Income Tax All businesses except partnerships must file an annual income tax return. 1040ez 2010printable tax forms Partnerships file an information return. 1040ez 2010printable tax forms Which form you use depends on how your business is organized. 1040ez 2010printable tax forms See Table 2 to find out which return you have to file. 1040ez 2010printable tax forms The federal income tax is a pay-as-you-go tax. 1040ez 2010printable tax forms You must pay the tax as you earn or receive income during the year. 1040ez 2010printable tax forms An employee usually has income tax withheld from his or her pay. 1040ez 2010printable tax forms If you do not pay your tax through withholding, or do not pay enough tax that way, you might have to pay estimated tax. 1040ez 2010printable tax forms If you are not required to make estimated tax payments, you may pay any tax due when you file your return. 1040ez 2010printable tax forms Table 2. 1040ez 2010printable tax forms Which Forms Must I File? IF you are a. 1040ez 2010printable tax forms . 1040ez 2010printable tax forms . 1040ez 2010printable tax forms   THEN you may be liable for. 1040ez 2010printable tax forms . 1040ez 2010printable tax forms . 1040ez 2010printable tax forms   Use Form. 1040ez 2010printable tax forms . 1040ez 2010printable tax forms . 1040ez 2010printable tax forms Sole proprietor   Income tax   1040 and Schedule C 1 or C-EZ (Schedule F 1 for farm business)     Self-employment tax   1040 and Schedule SE     Estimated tax   1040-ES     Employment taxes:         • Social security and Medicare   taxes and income tax   withholding   941 or 944 (943 for farm employees)     • Federal unemployment (FUTA)   tax   940     Excise taxes   See Excise Taxes Partnership   Annual return of income   1065     Employment taxes   Same as sole proprietor     Excise taxes   See Excise Taxes Partner in a partnership (individual)   Income tax   1040 and Schedule E 2     Self-employment tax   1040 and Schedule SE     Estimated tax   1040-ES Corporation or S corporation   Income tax   1120 (corporation) 2  1120S (S corporation) 2     Estimated tax   1120-W (corporation only)     Employment taxes   Same as sole proprietor     Excise taxes   See Excise Taxes S corporation shareholder   Income tax   1040 and Schedule E 2     Estimated tax   1040-ES 1 File a separate schedule for each business. 1040ez 2010printable tax forms 2 Various other schedules may be needed. 1040ez 2010printable tax forms Estimated tax. 1040ez 2010printable tax forms   Generally, you must pay taxes on income, including self-employment tax (discussed next), by making regular payments of estimated tax during the year. 1040ez 2010printable tax forms Sole proprietors, partners, and S corporation shareholders. 1040ez 2010printable tax forms   You generally have to make estimated tax payments if you expect to owe tax of $1,000 or more when you file your return. 1040ez 2010printable tax forms Use Form 1040-ES, Estimated Tax for Individuals, to figure and pay your estimated tax. 1040ez 2010printable tax forms For more information, see Publication 505, Tax Withholding and Estimated Tax. 1040ez 2010printable tax forms Corporations. 1040ez 2010printable tax forms   You generally have to make estimated tax payments for your corporation if you expect it to owe tax of $500 or more when you file its return. 1040ez 2010printable tax forms Use Form 1120-W, Estimated Tax for Corporations, to figure the estimated tax. 1040ez 2010printable tax forms You must deposit the payments as explained later under Depositing Taxes. 1040ez 2010printable tax forms For more information, see Publication 542. 1040ez 2010printable tax forms Self-Employment Tax Self-employment tax (SE tax) is a social security and Medicare tax primarily for individuals who work for themselves. 1040ez 2010printable tax forms Your payments of SE tax contribute to your coverage under the social security system. 1040ez 2010printable tax forms Social security coverage provides you with retirement benefits, disability benefits, survivor benefits, and hospital insurance (Medicare) benefits. 1040ez 2010printable tax forms You must pay SE tax and file Schedule SE (Form 1040) if either of the following applies. 1040ez 2010printable tax forms Your net earnings from self-employment were $400 or more. 1040ez 2010printable tax forms You had church employee income of $108. 1040ez 2010printable tax forms 28 or more. 1040ez 2010printable tax forms Use Schedule SE (Form 1040) to figure your SE tax. 1040ez 2010printable tax forms For more information, see Publication 334, Tax Guide for Small Business. 1040ez 2010printable tax forms You can deduct a portion of your SE tax as an adjustment to income on your Form 1040. 1040ez 2010printable tax forms The Social Security Administration (SSA) time limit for posting self-employment income. 1040ez 2010printable tax forms   Generally, the SSA will give you credit only for self-employment income reported on a tax return filed within 3 years, 3 months, and 15 days after the tax year you earned the income. 1040ez 2010printable tax forms If you file your tax return or report a change in your self-employment income after this time limit, the SSA may change its records, but only to remove or reduce the amount. 1040ez 2010printable tax forms The SSA will not change its records to increase your self-employment income. 1040ez 2010printable tax forms Employment Taxes This section briefly discusses the employment taxes you must pay, the forms you must file to report them, and other forms that must be filed when you have employees. 1040ez 2010printable tax forms Employment taxes include the following. 1040ez 2010printable tax forms Social security and Medicare taxes. 1040ez 2010printable tax forms Federal income tax withholding. 1040ez 2010printable tax forms Federal unemployment (FUTA) tax. 1040ez 2010printable tax forms If you have employees, you will need to get Publication 15, Circular E, Employer's Tax Guide. 1040ez 2010printable tax forms If you have agricultural employees, get Publication 51, Circular A, Agricultural Employer's Tax Guide. 1040ez 2010printable tax forms These publications explain your tax responsibilities as an employer. 1040ez 2010printable tax forms If you are not sure whether the people working for you are your employees, see Publication 15-A, Employer's Supplemental Tax Guide. 1040ez 2010printable tax forms That publication has information to help you determine whether an individual is an employee or an independent contractor. 1040ez 2010printable tax forms If you classify an employee as an independent contractor, you can be held liable for employment taxes for that worker plus a penalty. 1040ez 2010printable tax forms An independent contractor is someone who is self-employed. 1040ez 2010printable tax forms Generally, you do not have to withhold or pay any taxes on payments to an independent contractor. 1040ez 2010printable tax forms Federal Income, Social Security, and Medicare Taxes You generally must withhold federal income tax from your employee's wages. 1040ez 2010printable tax forms To figure how much federal income tax to withhold from each wage payment, use the employee's Form W-4 (discussed later under Hiring Employees) and the methods described in Publication 15. 1040ez 2010printable tax forms Social security and Medicare taxes pay for benefits that workers and their families receive under the Federal Insurance Contributions Act (FICA). 1040ez 2010printable tax forms Social security tax pays for benefits under the old-age, survivors, and disability insurance part of FICA. 1040ez 2010printable tax forms Medicare tax pays for benefits under the hospital insurance part of FICA. 1040ez 2010printable tax forms You withhold part of these taxes from your employee's wages and you pay a part yourself. 1040ez 2010printable tax forms To find out how much social security and Medicare tax to withhold and to pay, see Publication 15. 1040ez 2010printable tax forms Which form do I file?   Report these taxes on Form 941, Employer's QUARTERLY Federal Tax Return, or Form 944, Employer's ANNUAL Federal Tax Return. 1040ez 2010printable tax forms (Farm employers use Form 943, Employer's Annual Federal Tax Return for Agricultural Employees. 1040ez 2010printable tax forms ) Federal Unemployment (FUTA) Tax The federal unemployment tax is part of the federal and state program under the Federal Unemployment Tax Act (FUTA) that pays unemployment compensation to workers who lose their jobs. 1040ez 2010printable tax forms You report and pay FUTA tax separately from social security and Medicare taxes and withheld income tax. 1040ez 2010printable tax forms You pay FUTA tax only from your own funds. 1040ez 2010printable tax forms Employees do not pay this tax or have it withheld from their pay. 1040ez 2010printable tax forms Which form do I file?   Report federal unemployment tax on Form 940, Employer's Annual Federal Unemployment (FUTA) Tax Return. 1040ez 2010printable tax forms See Publication 15 to find out if you can use this form. 1040ez 2010printable tax forms Hiring Employees Have the employees you hire fill out Form I-9 and Form W-4. 1040ez 2010printable tax forms Form I-9. 1040ez 2010printable tax forms   You must verify that each new employee is legally eligible to work in the United States. 1040ez 2010printable tax forms Both you and the employee must complete the U. 1040ez 2010printable tax forms S. 1040ez 2010printable tax forms Citizenship and Immigration Services (USCIS) Form I-9, Employment Eligibility Verification. 1040ez 2010printable tax forms You can get the form from USCIS offices or from the USCIS website at www. 1040ez 2010printable tax forms uscis. 1040ez 2010printable tax forms gov. 1040ez 2010printable tax forms Call the USCIS at 1-800-375-5283 for more information about your responsibilities. 1040ez 2010printable tax forms Form W-4. 1040ez 2010printable tax forms   Each employee must fill out Form W-4, Employee's Withholding Allowance Certificate. 1040ez 2010printable tax forms You will use the filing status and withholding allowances shown on this form to figure the amount of income tax to withhold from your employee's wages. 1040ez 2010printable tax forms For more information, see Publication 15. 1040ez 2010printable tax forms Employees claiming more than 10 withholding allowances. 1040ez 2010printable tax forms   An employer of an employee who claims more than 10 withholding allowances for wages paid can use several methods of withholding. 1040ez 2010printable tax forms See section 16 of Publication 15. 1040ez 2010printable tax forms Form W-2 Wage Reporting After the calendar year is over, you must furnish copies of Form W-2, Wage and Tax Statement, to each employee to whom you paid wages during the year. 1040ez 2010printable tax forms You must also send copies to the Social Security Administration. 1040ez 2010printable tax forms See Information Returns, later, for more information on Form W-2. 1040ez 2010printable tax forms Excise Taxes This section describes the excise taxes you may have to pay and the forms you have to file if you do any of the following. 1040ez 2010printable tax forms Manufacture or sell certain products. 1040ez 2010printable tax forms Operate certain kinds of businesses. 1040ez 2010printable tax forms Use various kinds of equipment, facilities, or products. 1040ez 2010printable tax forms Receive payment for certain services. 1040ez 2010printable tax forms For more information on excise taxes, see Publication 510, Excise Taxes. 1040ez 2010printable tax forms Form 720. 1040ez 2010printable tax forms   The federal excise taxes reported on Form 720, Quarterly Federal Excise Tax Return, consist of several broad categories of taxes, including the following. 1040ez 2010printable tax forms Environmental taxes. 1040ez 2010printable tax forms Communications and air transportation taxes. 1040ez 2010printable tax forms Fuel taxes. 1040ez 2010printable tax forms Tax on the first retail sale of heavy trucks, trailers, and tractors. 1040ez 2010printable tax forms Manufacturers taxes on the sale or use of a variety of different articles. 1040ez 2010printable tax forms Form 2290. 1040ez 2010printable tax forms   There is a federal excise tax on certain trucks, truck tractors, and buses used on public highways. 1040ez 2010printable tax forms The tax applies to vehicles having a taxable gross weight of 55,000 pounds or more. 1040ez 2010printable tax forms Report the tax on Form 2290, Heavy Highway Vehicle Use Tax Return. 1040ez 2010printable tax forms For more information, see the instructions for Form 2290. 1040ez 2010printable tax forms Form 730. 1040ez 2010printable tax forms   If you are in the business of accepting wagers or conducting a wagering pool or lottery, you may be liable for the federal excise tax on wagering. 1040ez 2010printable tax forms Use Form 730, Monthly Tax Return for Wagers, to figure the tax on the wagers you receive. 1040ez 2010printable tax forms Form 11-C. 1040ez 2010printable tax forms   Use Form 11-C, Occupational Tax and Registration Return for Wagering, to register for any wagering activity and to pay the federal occupational tax on wagering. 1040ez 2010printable tax forms Depositing Taxes You generally have to deposit employment taxes, certain excise taxes, corporate income tax, and S corporation taxes before you file your return. 1040ez 2010printable tax forms Generally, taxpayers are required to deposit taxes through the Electronic Federal Tax Payment System (EFTPS). 1040ez 2010printable tax forms Any business that has a federal tax obligation and requests a new EIN will automatically be enrolled in EFTPS. 1040ez 2010printable tax forms Through the mail, the business will receive an EFTPS PIN package that contains instructions for activating its EFTPS enrollment. 1040ez 2010printable tax forms Information Returns If you make or receive payments in your business, you may have to report them to the IRS on information returns. 1040ez 2010printable tax forms The IRS compares the payments shown on the information returns with each person's income tax return to see if the payments were included in income. 1040ez 2010printable tax forms You must give a copy of each information return you are required to file to the recipient or payer. 1040ez 2010printable tax forms In addition to the forms described below, you may have to use other returns to report certain kinds of payments or transactions. 1040ez 2010printable tax forms For more details on information returns and when you have to file them, see the General Instructions for Certain Information Returns. 1040ez 2010printable tax forms Form 1099-MISC. 1040ez 2010printable tax forms   Use Form 1099-MISC, Miscellaneous Income, to report certain payments you make in your trade or business. 1040ez 2010printable tax forms These payments include the following items. 1040ez 2010printable tax forms Payments of $600 or more for services performed for your business by people not treated as your employees, such as subcontractors, attorneys, accountants, or directors. 1040ez 2010printable tax forms Rent payments of $600 or more, other than rents paid to real estate agents. 1040ez 2010printable tax forms Prizes and awards of $600 or more that are not for services, such as winnings on TV or radio shows. 1040ez 2010printable tax forms Royalty payments of $10 or more. 1040ez 2010printable tax forms Payments to certain crew members by operators of fishing boats. 1040ez 2010printable tax forms You also use Form 1099-MISC to report your sales of $5,000 or more of consumer goods to a person for resale anywhere other than in a permanent retail establishment. 1040ez 2010printable tax forms Form W-2. 1040ez 2010printable tax forms   You must file Form W-2, Wage and Tax Statement, to report payments to your employees, such as wages, tips, and other compensation, withheld income, social security, and Medicare taxes. 1040ez 2010printable tax forms For more information on what to report on Form W-2, see the Instructions for Forms W-2 and W-3. 1040ez 2010printable tax forms Form 8300. 1040ez 2010printable tax forms   You must file Form 8300, Report of Cash Payments Over $10,000 Received in a Trade or Business, if you receive more than $10,000 in cash in one transaction or two or more related business transactions. 1040ez 2010printable tax forms Cash includes U. 1040ez 2010printable tax forms S. 1040ez 2010printable tax forms and foreign coin and currency. 1040ez 2010printable tax forms It also includes certain monetary instruments such as cashier's and traveler's checks and money orders. 1040ez 2010printable tax forms For more information, see Publication 1544, Reporting Cash Payments of Over $10,000 (Received in a Trade or Business). 1040ez 2010printable tax forms Penalties The law provides penalties for not filing returns or paying taxes as required. 1040ez 2010printable tax forms Criminal penalties may be imposed for willful failure to file, tax evasion, or making a false statement. 1040ez 2010printable tax forms Failure to file tax returns. 1040ez 2010printable tax forms   If you do not file your tax return by the due date, you may have to pay a penalty. 1040ez 2010printable tax forms The penalty is based on the tax not paid by the due date. 1040ez 2010printable tax forms See your tax return instructions for more information about this penalty. 1040ez 2010printable tax forms Failure to pay tax. 1040ez 2010printable tax forms   If you do not pay your taxes by the due date, you will have to pay a penalty for each month, or part of a month, that your taxes are not paid. 1040ez 2010printable tax forms For more information, see your tax return instructions. 1040ez 2010printable tax forms Failure to withhold, deposit, or pay taxes. 1040ez 2010printable tax forms   If you do not withhold income, social security, or Medicare taxes from employees, or if you withhold taxes but do not deposit them or pay them to the IRS, you may be subject to a penalty of the unpaid tax, plus interest. 1040ez 2010printable tax forms You may also be subject to penalties if you deposit the taxes late. 1040ez 2010printable tax forms For more information, see Publication 15. 1040ez 2010printable tax forms Failure to follow information reporting requirements. 1040ez 2010printable tax forms   The following penalties apply if you are required to file information returns. 1040ez 2010printable tax forms For more information, see the General Instructions for Certain Information Returns. 1040ez 2010printable tax forms Failure to file information returns. 1040ez 2010printable tax forms A penalty applies if you do not file information returns by the due date, if you do not include all required information, or if you report incorrect information. 1040ez 2010printable tax forms Failure to furnish correct payee statements. 1040ez 2010printable tax forms A penalty applies if you do not furnish a required statement to a payee by the due date, if you do not include all required information, or if you report incorrect information. 1040ez 2010printable tax forms Waiver of penalty. 1040ez 2010printable tax forms   These penalties will not apply if you can show that the failures were due to reasonable cause and not willful neglect. 1040ez 2010printable tax forms   In addition, there is no penalty for failure to include all the required information, or for including incorrect information, on a de minimis number of information returns if you correct the errors by August 1 of the year the returns are due. 1040ez 2010printable tax forms (To be considered de minimis, the number of returns cannot exceed the greater of 10 or ½ of 1% of the total number of returns you are required to file for the year. 1040ez 2010printable tax forms ) Failure to supply taxpayer identification number. 1040ez 2010printable tax forms   If you do not include your taxpayer identification number (SSN or EIN) or the taxpayer identification number of another person where required on a return, statement, or other document, you may be subject to a penalty of $50 for each failure. 1040ez 2010printable tax forms You may also be subject to the $50 penalty if you do not give your taxpayer identification number to another person when it is required on a return, statement, or other document. 1040ez 2010printable tax forms Business Expenses You can deduct business expenses on your income tax return. 1040ez 2010printable tax forms These are the current operating costs of running your business. 1040ez 2010printable tax forms To be deductible, a business expense must be both ordinary and necessary. 1040ez 2010printable tax forms An ordinary expense is one that is common and accepted in your field of business, trade, or profession. 1040ez 2010printable tax forms A necessary expense is one that is helpful and appropriate for your business, trade, or profession. 1040ez 2010printable tax forms An expense does not have to be indispensable to be considered necessary. 1040ez 2010printable tax forms The following are brief explanations of some expenses that are of interest to people starting a business. 1040ez 2010printable tax forms There are many other expenses that you may be able to deduct. 1040ez 2010printable tax forms See your form instructions and Publication 535, Business Expenses. 1040ez 2010printable tax forms Business Start-Up Costs Business start-up costs are the expenses you incur before you actually begin business operations. 1040ez 2010printable tax forms Your business start-up costs will depend on the type of business you are starting. 1040ez 2010printable tax forms They may include costs for advertising, travel, surveys, and training. 1040ez 2010printable tax forms These costs are generally capital expenses. 1040ez 2010printable tax forms You usually recover costs for a particular asset (such as machinery or office equipment) through depreciation (discussed next). 1040ez 2010printable tax forms You can elect to deduct up to $5,000 of business start-up costs and $5,000 of organizational costs paid or incurred after October 22, 2004. 1040ez 2010printable tax forms The $5,000 deduction is reduced by the amount your total start-up or organizational costs exceed $50,000. 1040ez 2010printable tax forms Any remaining cost must be amortized. 1040ez 2010printable tax forms For more information about amortizing start-up and organizational costs, see chapter 7 in Publication 535. 1040ez 2010printable tax forms Depreciation If property you acquire to use in your business has a useful life that extends substantially beyond the year it is placed in service, you generally cannot deduct the entire cost as a business expense in the year you acquire it. 1040ez 2010printable tax forms You must spread the cost over more than one tax year and deduct part of it each year. 1040ez 2010printable tax forms This method of deducting the cost of business property is called depreciation. 1040ez 2010printable tax forms Business property you must depreciate includes the following items. 1040ez 2010printable tax forms Office furniture. 1040ez 2010printable tax forms Buildings. 1040ez 2010printable tax forms Machinery and equipment. 1040ez 2010printable tax forms You can choose to deduct a limited amount of the cost of certain depreciable property in the year you place the property in service. 1040ez 2010printable tax forms This deduction is known as the “section 179 deduction. 1040ez 2010printable tax forms ” For more information about depreciation and the section 179 deduction, see Publication 946, How To Depreciate Property. 1040ez 2010printable tax forms Depreciation must be taken in the year it is allowable. 1040ez 2010printable tax forms Allowable depreciation not taken in a prior year cannot be taken in the current year. 1040ez 2010printable tax forms If you do not deduct the correct depreciation, you may be able to make a correction by filing Form 1040X, Amended U. 1040ez 2010printable tax forms S. 1040ez 2010printable tax forms Individual Income Tax Return, or by changing your accounting method. 1040ez 2010printable tax forms For more information on how to correct depreciation deductions, see chapter 1 in Publication 946. 1040ez 2010printable tax forms Business Use of Your Home To deduct expenses related to the business use of part of your home, you must meet specific requirements. 1040ez 2010printable tax forms Even then, your deduction may be limited. 1040ez 2010printable tax forms To qualify to claim expenses for business use of your home, you must meet both the following tests. 1040ez 2010printable tax forms Your use of the business part of your home must be: Exclusive (however, see Exceptions to exclusive use, later), Regular, For your trade or business, AND The business part of your home must be one of the following: Your principal place of business (defined later), A place where you meet or deal with patients, clients, or customers in the normal course of your trade or business, or A separate structure (not attached to your home) you use in connection with your trade or business. 1040ez 2010printable tax forms Exclusive use. 1040ez 2010printable tax forms   To qualify under the exclusive use test, you must use a specific area of your home only for your trade or business. 1040ez 2010printable tax forms The area used for business can be a room or other separately identifiable space. 1040ez 2010printable tax forms The space does not need to be marked off by a permanent partition. 1040ez 2010printable tax forms   You do not meet the requirements of the exclusive use test if you use the area in question both for business and for personal purposes. 1040ez 2010printable tax forms Exceptions to exclusive use. 1040ez 2010printable tax forms   You do not have to meet the exclusive use test if either of the following applies. 1040ez 2010printable tax forms You use part of your home for the storage of inventory or product samples. 1040ez 2010printable tax forms You use part of your home as a daycare facility. 1040ez 2010printable tax forms For an explanation of these exceptions, see Publication 587, Business Use of Your Home (Including Use by Daycare Providers). 1040ez 2010printable tax forms Principal place of business. 1040ez 2010printable tax forms   Your home office will qualify as your principal place of business for deducting expenses for its use if you meet the following requirements. 1040ez 2010printable tax forms You use it exclusively and regularly for administrative or management activities of your trade or business. 1040ez 2010printable tax forms You have no other fixed location where you conduct substantial administrative or management activities of your trade or business. 1040ez 2010printable tax forms   Alternatively, if you use your home exclusively and regularly for your business, but your home office does not qualify as your principal place of business based on the previous rules, you determine your principal place of business based on the following factors. 1040ez 2010printable tax forms The relative importance of the activities performed at each location. 1040ez 2010printable tax forms If the relative importance factor does not determine your principal place of business, the time spent at each location. 1040ez 2010printable tax forms    If, after considering your business locations, your home cannot be identified as your principal place of business, you cannot deduct home office expenses. 1040ez 2010printable tax forms However, for other ways to qualify to deduct home office expenses, see Publication 587. 1040ez 2010printable tax forms Which form do I file?   If you file Schedule C (Form 1040), use Form 8829, Expenses for Business Use of Your Home, to figure your deduction. 1040ez 2010printable tax forms If you file Schedule F (Form 1040) or you are a partner, you can use the worksheet in Publication 587. 1040ez 2010printable tax forms More information. 1040ez 2010printable tax forms   For more information about business use of your home, see Publication 587. 1040ez 2010printable tax forms Car and Truck Expenses If you use your car or truck in your business, you can deduct the costs of operating and maintaining it. 1040ez 2010printable tax forms You generally can deduct either your actual expenses or the standard mileage rate. 1040ez 2010printable tax forms Actual expenses. 1040ez 2010printable tax forms   If you deduct actual expenses, you can deduct the cost of the following items: Depreciation Lease payments Registration Garage rent Licenses Repairs Gas Oil Tires Insurance Parking fees Tolls   If you use your vehicle for both business and personal purposes, you must divide your expenses between business and personal use. 1040ez 2010printable tax forms You can divide your expenses based on the miles driven for each purpose. 1040ez 2010printable tax forms Example. 1040ez 2010printable tax forms You are the sole proprietor of a flower shop. 1040ez 2010printable tax forms You drove your van 20,000 miles during the year. 1040ez 2010printable tax forms 16,000 miles were for delivering flowers to customers and 4,000 miles were for personal use. 1040ez 2010printable tax forms You can claim only 80% (16,000 ÷ 20,000) of the cost of operating your van as a business expense. 1040ez 2010printable tax forms Standard mileage rate. 1040ez 2010printable tax forms   Instead of figuring actual expenses, you may be able to use the standard mileage rate to figure the deductible costs of operating your car, van, pickup, or panel truck for business purposes. 1040ez 2010printable tax forms You can use the standard mileage rate for a vehicle you own or lease. 1040ez 2010printable tax forms The standard mileage rate is a specified amount of money you can deduct for each business mile you drive. 1040ez 2010printable tax forms It is announced annually by the IRS. 1040ez 2010printable tax forms To figure your deduction, multiply your business miles by the standard mileage rate for the year. 1040ez 2010printable tax forms    Generally, if you use the standard mileage rate, you cannot deduct your actual expenses. 1040ez 2010printable tax forms However, you may be able to deduct business-related parking fees, tolls, interest on your car loan, and certain state and local taxes. 1040ez 2010printable tax forms Choosing the standard mileage rate. 1040ez 2010printable tax forms   If you want to use the standard mileage rate for a car you own, you must choose to use it in the first year the car is available for use in your business. 1040ez 2010printable tax forms In later years, you can choose to use either the standard mileage rate or actual expenses. 1040ez 2010printable tax forms   If you use the standard mileage rate for a car you lease, you must choose to use it for the entire lease period (including renewals). 1040ez 2010printable tax forms Additional information. 1040ez 2010printable tax forms   For more information about the rules for claiming car and truck expenses, see Publication 463, Travel, Entertainment, Gift, and Car Expenses. 1040ez 2010printable tax forms Recordkeeping This part explains why you must keep records, what kinds of records you must keep, and how to keep them. 1040ez 2010printable tax forms It also explains how long you must keep your records for federal tax purposes. 1040ez 2010printable tax forms A sample recordkeeping system is illustrated at the end of this part. 1040ez 2010printable tax forms Why Keep Records? Everyone in business must keep records. 1040ez 2010printable tax forms Good records will help you do the following. 1040ez 2010printable tax forms Monitor the progress of your business. 1040ez 2010printable tax forms   You need good records to monitor the progress of your business. 1040ez 2010printable tax forms Records can show whether your business is improving, which items are selling, or what changes you need to make. 1040ez 2010printable tax forms Good records can increase the likelihood of business success. 1040ez 2010printable tax forms Prepare your financial statements. 1040ez 2010printable tax forms   You need good records to prepare accurate financial statements. 1040ez 2010printable tax forms These include income (profit and loss) statements and balance sheets. 1040ez 2010printable tax forms These statements can help you in dealing with your bank or creditors and help you manage your business. 1040ez 2010printable tax forms An income statement shows the income and expenses of the business for a given period of time. 1040ez 2010printable tax forms A balance sheet shows the assets, liabilities, and your equity in the business on a given date. 1040ez 2010printable tax forms Identify source of receipts. 1040ez 2010printable tax forms   You will receive money or property from many sources. 1040ez 2010printable tax forms Your records can identify the source of your receipts. 1040ez 2010printable tax forms You need this information to separate business from nonbusiness receipts and taxable from nontaxable income. 1040ez 2010printable tax forms Keep track of deductible expenses. 1040ez 2010printable tax forms   You may forget expenses when you prepare your tax return unless you record them when they occur. 1040ez 2010printable tax forms Prepare your tax returns. 1040ez 2010printable tax forms   You need good records to prepare your tax returns. 1040ez 2010printable tax forms These records must support the income, expenses, and credits you report. 1040ez 2010printable tax forms Generally, these are the same records you use to monitor your business and prepare your financial statements. 1040ez 2010printable tax forms Support items reported on tax returns. 1040ez 2010printable tax forms   You must keep your business records available at all times for inspection by the IRS. 1040ez 2010printable tax forms If the IRS examines any of your tax returns, you may be asked to explain the items reported. 1040ez 2010printable tax forms A complete set of records will speed up the examination. 1040ez 2010printable tax forms Kinds of Records To Keep Except in a few cases, the law does not require any specific kind of records. 1040ez 2010printable tax forms You can choose any recordkeeping system suited to your business that clearly shows your income and expenses. 1040ez 2010printable tax forms The business you are in affects the type of records you need to keep for federal tax purposes. 1040ez 2010printable tax forms You should set up your recordkeeping system using an accounting method that clearly shows your income for your tax year. 1040ez 2010printable tax forms See Accounting Method, earlier. 1040ez 2010printable tax forms If you are in more than one business, you should keep a complete and separate set of records for each business. 1040ez 2010printable tax forms A corporation should keep minutes of board of directors' meetings. 1040ez 2010printable tax forms Your recordkeeping system should include a summary of your business transactions. 1040ez 2010printable tax forms This summary is ordinarily made in your books (for example, accounting journals and ledgers). 1040ez 2010printable tax forms Your books must show your gross income, as well as your deductions and credits. 1040ez 2010printable tax forms For most small businesses, the business checkbook (discussed later) is the main source for entries in the business books. 1040ez 2010printable tax forms In addition, you must keep supporting documents, explained later. 1040ez 2010printable tax forms Electronic records. 1040ez 2010printable tax forms   All requirements that apply to hard copy books and records also apply to electronic storage systems that maintain tax books and records. 1040ez 2010printable tax forms When you replace hard copy books and records, you must maintain the electronic storage systems for as long as they are material to the administration of tax law. 1040ez 2010printable tax forms An electronic storage system is any system for preparing or keeping your records either by electronic imaging or by transfer to an electronic storage media. 1040ez 2010printable tax forms The electronic storage system must index, store, preserve, retrieve and reproduce the electronically stored books and records in legible format. 1040ez 2010printable tax forms All electronic storage systems must provide a complete and accurate record of your data that is accessible to the IRS. 1040ez 2010printable tax forms Electronic storage systems are also subject to the same controls and retention guidelines as those imposed on your original hard copy books and records. 1040ez 2010printable tax forms   The original hard copy books and records may be destroyed provided that the electronic storage system has been tested to establish that the hard copy books and records are being reproduced in compliance with IRS requirements for an electronic storage system and procedures are established to ensure continued compliance with all applicable rules and regulations. 1040ez 2010printable tax forms You still have the responsibility of retaining any other books and records that are required to be retained. 1040ez 2010printable tax forms   The IRS may test your electronic storage system, including the equipment used, indexing methodology, software and retrieval capabilities. 1040ez 2010printable tax forms This test is not considered an examination and the results must be shared with you. 1040ez 2010printable tax forms If your electronic storage system meets the requirements mentioned earlier, you will be in compliance. 1040ez 2010printable tax forms If not, you may be subject to penalties for non-compliance, unless you continue to maintain your original hard copy books and records in a manner that allows you and the IRS to determine your correct tax. 1040ez 2010printable tax forms For details on electronic storage system requirements, see Revenue Procedure 97-22, available in Internal Revenue Bulletin 1997-13. 1040ez 2010printable tax forms Supporting Documents Purchases, sales, payroll, and other transactions you have in your business generate supporting documents. 1040ez 2010printable tax forms Supporting documents include sales slips, paid bills, invoices, receipts, deposit slips, and canceled checks. 1040ez 2010printable tax forms These documents contain information you need to record in your books. 1040ez 2010printable tax forms It is important to keep these documents because they support the entries in your books and on your tax return. 1040ez 2010printable tax forms Keep them in an orderly fashion and in a safe place. 1040ez 2010printable tax forms For instance, organize them by year and type of income or expense. 1040ez 2010printable tax forms Gross receipts. 1040ez 2010printable tax forms   Gross receipts are the income you receive from your business. 1040ez 2010printable tax forms You should keep supporting documents that show the amounts and sources of your gross receipts. 1040ez 2010printable tax forms Documents that show gross receipts include the following. 1040ez 2010printable tax forms Cash register tapes. 1040ez 2010printable tax forms Bank deposit slips. 1040ez 2010printable tax forms Receipt books. 1040ez 2010printable tax forms Invoices. 1040ez 2010printable tax forms Credit card charge slips. 1040ez 2010printable tax forms Forms 1099-MISC. 1040ez 2010printable tax forms Purchases. 1040ez 2010printable tax forms   Purchases are the items you buy and resell to customers. 1040ez 2010printable tax forms If you are a manufacturer or producer, this includes the cost of all raw materials or parts purchased for manufacture into finished products. 1040ez 2010printable tax forms Your supporting documents should show the amount paid and that the amount was for purchases. 1040ez 2010printable tax forms Documents for purchases include the following. 1040ez 2010printable tax forms Canceled checks. 1040ez 2010printable tax forms Cash register tape receipts. 1040ez 2010printable tax forms Credit card sales slips. 1040ez 2010printable tax forms Invoices. 1040ez 2010printable tax forms These records will help you determine the value of your inventory at the end of the year. 1040ez 2010printable tax forms See Publication 538 for information on methods for valuing inventory. 1040ez 2010printable tax forms Expenses. 1040ez 2010printable tax forms   Expenses are the costs you incur (other than purchases) to carry on your business. 1040ez 2010printable tax forms Your supporting documents should show the amount paid and that the amount was for a business expense. 1040ez 2010printable tax forms Documents for expenses include the following. 1040ez 2010printable tax forms Canceled checks. 1040ez 2010printable tax forms Cash register tapes. 1040ez 2010printable tax forms Account statements. 1040ez 2010printable tax forms Credit card sales slips. 1040ez 2010printable tax forms Invoices. 1040ez 2010printable tax forms Petty cash slips for small cash payments. 1040ez 2010printable tax forms    A petty cash fund allows you to make small payments without having to write checks for small amounts. 1040ez 2010printable tax forms Each time you make a payment from this fund, you should make out a petty cash slip and attach it to your receipt as proof of payment. 1040ez 2010printable tax forms Travel, transportation, entertainment, and gift expenses. 1040ez 2010printable tax forms   Specific recordkeeping rules apply to these expenses. 1040ez 2010printable tax forms For more information, see Publication 463. 1040ez 2010printable tax forms Employment taxes. 1040ez 2010printable tax forms   There are specific employment tax records you must keep. 1040ez 2010printable tax forms For a list, see Publication 15. 1040ez 2010printable tax forms Assets. 1040ez 2010printable tax forms   Assets are the property, such as machinery and furniture you own and use in your business. 1040ez 2010printable tax forms You must keep records to verify certain information about your business assets. 1040ez 2010printable tax forms You need records to figure the annual depreciation and the gain or loss when you sell the assets. 1040ez 2010printable tax forms Your records should show the following information. 1040ez 2010printable tax forms When and how you acquired the asset. 1040ez 2010printable tax forms Purchase price. 1040ez 2010printable tax forms Cost of any improvements. 1040ez 2010printable tax forms Section 179 deduction taken. 1040ez 2010printable tax forms Deductions taken for depreciation. 1040ez 2010printable tax forms Deductions taken for casualty losses, such as losses resulting from fires or storms. 1040ez 2010printable tax forms How you used the asset. 1040ez 2010printable tax forms When and how you disposed of the asset. 1040ez 2010printable tax forms Selling price. 1040ez 2010printable tax forms Expenses of sale. 1040ez 2010printable tax forms   The following documents may show this information. 1040ez 2010printable tax forms Purchase and sales invoices. 1040ez 2010printable tax forms Real estate closing statements. 1040ez 2010printable tax forms Canceled checks. 1040ez 2010printable tax forms What if I don't have a canceled check?   If you do not have a canceled check, you may be able to prove payment with certain financial account statements prepared by financial institutions. 1040ez 2010printable tax forms These include account statements prepared for the financial institution by a third party. 1040ez 2010printable tax forms These account statements must be highly legible. 1040ez 2010printable tax forms The following table lists acceptable account statements. 1040ez 2010printable tax forms  IF payment is by. 1040ez 2010printable tax forms . 1040ez 2010printable tax forms . 1040ez 2010printable tax forms THEN the statement must show the. 1040ez 2010printable tax forms . 1040ez 2010printable tax forms . 1040ez 2010printable tax forms Check Check number. 1040ez 2010printable tax forms Amount. 1040ez 2010printable tax forms Payee's name. 1040ez 2010printable tax forms Date the check amount was posted to the account by the financial institution. 1040ez 2010printable tax forms Electronic funds transfer Amount transferred. 1040ez 2010printable tax forms Payee's name. 1040ez 2010printable tax forms Date the transfer was posted to the account by the financial institution. 1040ez 2010printable tax forms Credit card Amount charged. 1040ez 2010printable tax forms Payee's name. 1040ez 2010printable tax forms Transaction date. 1040ez 2010printable tax forms    Proof of payment of an amount, by itself, does not establish you are entitled to a tax deduction. 1040ez 2010printable tax forms You should also keep other documents, such as credit card sales slips and invoices, to show that you also incurred the cost. 1040ez 2010printable tax forms Recording Business Transactions A good recordkeeping system includes a summary of your business transactions. 1040ez 2010printable tax forms (Your business transactions are shown on the supporting documents just discussed. 1040ez 2010printable tax forms ) Business transactions are ordinarily summarized in books called journals and ledgers. 1040ez 2010printable tax forms You can buy them at your local stationery or office supply store. 1040ez 2010printable tax forms A journal is a book where you record each business transaction shown on your supporting documents. 1040ez 2010printable tax forms You may have to keep separate journals for transactions that occur frequently. 1040ez 2010printable tax forms A ledger is a book that contains the totals from all of your journals. 1040ez 2010printable tax forms It is organized into different accounts. 1040ez 2010printable tax forms Whether you keep journals and ledgers and how you keep them depends on the type of business you are in. 1040ez 2010printable tax forms For example, a recordkeeping system for a small business might include the following items. 1040ez 2010printable tax forms Business checkbook. 1040ez 2010printable tax forms Daily summary of cash receipts. 1040ez 2010printable tax forms Monthly summary of cash receipts. 1040ez 2010printable tax forms Check disbursements journal. 1040ez 2010printable tax forms Depreciation worksheet. 1040ez 2010printable tax forms Employee compensation record. 1040ez 2010printable tax forms The business checkbook is explained next. 1040ez 2010printable tax forms The other items are illustrated later under Sample Record System. 1040ez 2010printable tax forms The system you use to record business transactions will be more effective if you follow good recordkeeping practices. 1040ez 2010printable tax forms For example, record expenses when they occur, and identify the source of recorded receipts. 1040ez 2010printable tax forms Generally, it is best to record transactions on a daily basis. 1040ez 2010printable tax forms Business checkbook. 1040ez 2010printable tax forms   One of the first things you should do when you start a business is open a business checking account. 1040ez 2010printable tax forms You should keep your business account separate from your personal checking account. 1040ez 2010printable tax forms   The business checkbook is your basic source of information for recording your business expenses. 1040ez 2010printable tax forms You should deposit all daily receipts in your business checking account. 1040ez 2010printable tax forms You should check your account for errors by reconciling it. 1040ez 2010printable tax forms See Reconciling the checking account, later. 1040ez 2010printable tax forms   Consider using a checkbook that allows enough space to identify the source of deposits as business income, personal funds, or loans. 1040ez 2010printable tax forms You should also note on the deposit slip the source of the deposit and keep copies of all slips. 1040ez 2010printable tax forms   You should make all payments by check to document business expenses. 1040ez 2010printable tax forms Write checks payable to yourself only when making withdrawals from your business for personal use. 1040ez 2010printable tax forms Avoid writing checks payable to cash. 1040ez 2010printable tax forms If you must write a check for cash to pay a business expense, include the receipt for the cash payment in your records. 1040ez 2010printable tax forms If you cannot get a receipt for a cash payment, you should make an adequate explanation in your records at the time of payment. 1040ez 2010printable tax forms    Use the business account for business purposes only. 1040ez 2010printable tax forms Indicate the source of deposits and the type of expense in the checkbook. 1040ez 2010printable tax forms Reconciling the checking account. 1040ez 2010printable tax forms   When you receive your bank statement, make sure the statement, your checkbook, and your books agree. 1040ez 2010printable tax forms The statement balance may not agree with the balance in your checkbook and books if the statement: Includes bank charges you did not enter in your books and subtract from your checkbook balance, or Does not include deposits made after the statement date or checks that did not clear your account before the statement date. 1040ez 2010printable tax forms   By reconciling your checking account, you will: Verify how much money you have in the account, Make sure that your checkbook and books reflect all bank charges and the correct balance in the checking account, and Correct any errors in your bank statement, checkbook, and books. 1040ez 2010printable tax forms    You should reconcile your checking account each month. 1040ez 2010printable tax forms     Before you reconcile your monthly bank statement, check your own figures. 1040ez 2010printable tax forms Begin with the balance shown in your checkbook at the end of the previous month. 1040ez 2010printable tax forms To this balance, add the total cash deposited during the month and subtract the total cash disbursements. 1040ez 2010printable tax forms   After checking your figures, the result should agree with your checkbook balance at the end of the month. 1040ez 2010printable tax forms If the result does not agree, you may have made an error in recording a check or deposit. 1040ez 2010printable tax forms You can find the error by doing the following. 1040ez 2010printable tax forms Adding the amounts on your check stubs and comparing that total with the total in the “amount of check” column in your check disbursements journal. 1040ez 2010printable tax forms If the totals do not agree, check the individual amounts to see if an error was made in your check stub record or in the related entry in your check disbursements journal. 1040ez 2010printable tax forms Adding the deposit amounts in your checkbook. 1040ez 2010printable tax forms Compare that total with the monthly total in your cash receipt book, if you have one. 1040ez 2010printable tax forms If the totals do not agree, check the individual amounts to find any errors. 1040ez 2010printable tax forms   If your checkbook and journal entries still disagree, then refigure the running balance in your checkbook to make sure additions and subtractions are correct. 1040ez 2010printable tax forms   When your checkbook balance agrees with the balance figured from the journal entries, you may begin reconciling your checkbook with the bank statement. 1040ez 2010printable tax forms Many banks print a reconciliation worksheet on the back of the statement. 1040ez 2010printable tax forms   To reconcile your account, follow these steps. 1040ez 2010printable tax forms Compare the deposits listed on the bank statement with the deposits shown in your checkbook. 1040ez 2010printable tax forms Note all differences in the dollar amounts. 1040ez 2010printable tax forms Compare each canceled check, including both check number and dollar amount, with the entry in your checkbook. 1040ez 2010printable tax forms Note all differences in the dollar amounts. 1040ez 2010printable tax forms Mark the check number in the checkbook as having cleared the bank. 1040ez 2010printable tax forms After accounting for all checks returned by the bank, those not marked in your checkbook are your outstanding checks. 1040ez 2010printable tax forms Prepare a bank reconciliation. 1040ez 2010printable tax forms One is illustrated later under Sample Record System. 1040ez 2010printable tax forms Update your checkbook and journals for items shown on the reconciliation as not recorded (such as service charges) or recorded incorrectly. 1040ez 2010printable tax forms At this point, the adjusted bank statement balance should equal your adjusted checkbook balance. 1040ez 2010printable tax forms If you still have differences, check the previous steps to find the errors. 1040ez 2010printable tax forms   Table 3. 1040ez 2010printable tax forms Period of Limitations IF you. 1040ez 2010printable tax forms . 1040ez 2010printable tax forms . 1040ez 2010printable tax forms   THEN the period is. 1040ez 2010printable tax forms . 1040ez 2010printable tax forms . 1040ez 2010printable tax forms 1. 1040ez 2010printable tax forms Owe additional tax and situations (2), (3), and (4), below, do not apply to you   3 years 2. 1040ez 2010printable tax forms Do not report income that you should report and it is more than 25% of the gross income shown on the return   6 years 3. 1040ez 2010printable tax forms File a fraudulent return   Not limited 4. 1040ez 2010printable tax forms Do not file a return   Not limited 5. 1040ez 2010printable tax forms File a claim for credit or refund after you filed your return   Later of: 3 years or  2 years after tax   was paid 6. 1040ez 2010printable tax forms File a claim for a loss from worthless securities or a bad debt deduction   7 years Bookkeeping System You must decide whether to use a single-entry or a double-entry bookkeeping system. 1040ez 2010printable tax forms The single-entry system of bookkeeping is the simplest to maintain, but it may not be suitable for everyone. 1040ez 2010printable tax forms You may find the double-entry system better because it has built-in checks and balances to assure accuracy and control. 1040ez 2010printable tax forms Single-entry. 1040ez 2010printable tax forms   A single-entry system is based on the income statement (profit or loss statement). 1040ez 2010printable tax forms It can be a simple and practical system if you are starting a small business. 1040ez 2010printable tax forms The system records the flow of income and expenses through the use of: A daily summary of cash receipts, and Monthly summaries of cash receipts and disbursements. 1040ez 2010printable tax forms Double-entry. 1040ez 2010printable tax forms   A double-entry bookkeeping system uses journals and ledgers. 1040ez 2010printable tax forms Transactions are first entered in a journal and then posted to ledger accounts. 1040ez 2010printable tax forms These accounts show income, expenses, assets (property a business owns), liabilities (debts of a business), and net worth (excess of assets over liabilities). 1040ez 2010printable tax forms You close income and expense accounts at the end of each tax year. 1040ez 2010printable tax forms You keep asset, liability, and net worth accounts open on a permanent basis. 1040ez 2010printable tax forms   In the double-entry system, each account has a left side for debits and a right side for credits. 1040ez 2010printable tax forms It is self-balancing because you record every transaction as a debit entry in one account and as a credit entry in another. 1040ez 2010printable tax forms   Under this system, the total debits must equal the total credits after you post the journal entries to the ledger accounts. 1040ez 2010printable tax forms If the amounts do not balance, you have made an error and you must find and correct it. 1040ez 2010printable tax forms   An example of a journal entry exhibiting a payment of rent in October is shown next. 1040ez 2010printable tax forms General Journal Date Description of Entry Debit  Credit Oct. 1040ez 2010printable tax forms 5 Rent expense 780. 1040ez 2010printable tax forms 00     Cash   780. 1040ez 2010printable tax forms 00                 Computerized System There are computer software packages you can use for recordkeeping. 1040ez 2010printable tax forms They can be purchased in many retail stores. 1040ez 2010printable tax forms These packages are very helpful and relatively easy to use; they require very little knowledge of bookkeeping and accounting. 1040ez 2010printable tax forms If you use a computerized system, you must be able to produce sufficient legible records to support and verify entries made on your return and determine your correct tax liability. 1040ez 2010printable tax forms To meet this qualification, the machine-sensible records must reconcile with your books and return. 1040ez 2010printable tax forms These records must provide enough detail to identify the underlying source documents. 1040ez 2010printable tax forms You must also keep all machine-sensible records and a complete description of the computerized portion of your recordkeeping system. 1040ez 2010printable tax forms This documentation must be sufficiently detailed to show all of the following items. 1040ez 2010printable tax forms Functions being performed as the data flows through the system. 1040ez 2010printable tax forms Controls used to ensure accurate and reliable processing. 1040ez 2010printable tax forms Controls used to prevent the unauthorized addition, alteration, or deletion of retained records. 1040ez 2010printable tax forms Charts of accounts and detailed account descriptions. 1040ez 2010printable tax forms See Revenue Procedure 98-25 in Cumulative Bulletin 1998-1 for more information. 1040ez 2010printable tax forms How Long To Keep Records You must keep your records as long as they may be needed for the administration of any provision of the Internal Revenue Code. 1040ez 2010printable tax forms Generally, this means you must keep records that support an item of income or deduction on a return until the period of limitations for that return runs out. 1040ez 2010printable tax forms The period of limitations is the period of time in which you can amend your return to claim a credit or refund, or the IRS can assess additional tax. 1040ez 2010printable tax forms Table 3 contains the periods of limitations that apply to income tax returns. 1040ez 2010printable tax forms Unless otherwise stated, the years refer to the period after the return was filed. 1040ez 2010printable tax forms Returns filed before the due date are treated as filed on the due date. 1040ez 2010printable tax forms Keep copies of your filed tax returns. 1040ez 2010printable tax forms They help in preparing future tax returns and making computations if you file an amended return. 1040ez 2010printable tax forms Employment taxes. 1040ez 2010printable tax forms   If you have employees, you must keep all employment tax records for at least 4 years after the date the tax becomes due or is paid, whichever is later. 1040ez 2010printable tax forms For more information about recordkeeping for employment taxes, see Publication 15. 1040ez 2010printable tax forms Assets. 1040ez 2010printable tax forms   Keep records relating to property until the period of limitations expires for the year in which you dispose of the property in a taxable disposition. 1040ez 2010printable tax forms You must keep these records to figure any depreciation, amortization, or depletion deduction, and to figure your basis for computing gain or loss when you sell or otherwise dispose of the property. 1040ez 2010printable tax forms   Generally, if you received property in a nontaxable exchange, your basis in that property is the same as the basis of the property you gave up, increased by any money you paid. 1040ez 2010printable tax forms You must keep the records on the old property, as well as on the new property, until the period of limitations expires for the year in which you dispose of the new property in a taxable disposition. 1040ez 2010printable tax forms Records for nontax purposes. 1040ez 2010printable tax forms   When your records are no longer needed for tax purposes, do not discard them until you check to see if you have to keep them longer for other purposes. 1040ez 2010printable tax forms For example, your insurance company or creditors may require you to keep them longer than the IRS does. 1040ez 2010printable tax forms Sample Record System This example illustrates a single-entry system used by Henry Brown, who is the sole proprietor of a small automobile body shop. 1040ez 2010printable tax forms Henry uses part-time help, has no inventory of items held for sale, and uses the cash method of accounting. 1040ez 2010printable tax forms These sample records should not be viewed as a recommendation of how to keep your records. 1040ez 2010printable tax forms They are intended only to show how one business keeps its records. 1040ez 2010printable tax forms 1. 1040ez 2010printable tax forms Daily Summary of Cash Receipts This summary is a record of cash sales for the day. 1040ez 2010printable tax forms It accounts for cash at the end of the day over the amount in the Change and Petty Cash Fund at the beginning of the day. 1040ez 2010printable tax forms Henry takes the cash sales entry from his cash register tape. 1040ez 2010printable tax forms If he had no cash register, he would simply total his cash sale slips and any other cash received that day. 1040ez 2010printable tax forms He carries the total receipts shown in this summary for January 3 ($267. 1040ez 2010printable tax forms 80), including cash sales ($263. 1040ez 2010printable tax forms 60) and sales tax ($4. 1040ez 2010printable tax forms 20), to the Monthly Summary of Cash Receipts. 1040ez 2010printable tax forms Petty cash fund. 1040ez 2010printable tax forms   Henry uses a petty cash fund to make small payments without having to write checks for small amounts. 1040ez 2010printable tax forms Each time he makes a payment from this fund, he makes out a petty cash slip and attaches it to his receipt as proof of payment. 1040ez 2010printable tax forms He sets up a fixed amount ($50) in his petty cash fund. 1040ez 2010printable tax forms The total of the unspent petty cash and the amounts on the petty cash slips should equal the fixed amount of the fund. 1040ez 2010printable tax forms When the totals on the petty cash slips approach the fixed amount, he brings the cash in the fund back to the fixed amount by writing a check to “Petty Cash” for the total of the outstanding slips. 1040ez 2010printable tax forms (See the Check Disbursements Journal entry for check number 92. 1040ez 2010printable tax forms ) This restores the fund to its fixed amount of $50. 1040ez 2010printable tax forms He then summarizes the slips and enters them in the proper columns in the monthly check disbursements journal. 1040ez 2010printable tax forms 2. 1040ez 2010printable tax forms Monthly Summary of Cash Receipts This shows the income activity for the month. 1040ez 2010printable tax forms Henry carries the total monthly net sales shown in this summary for January ($4,865. 1040ez 2010printable tax forms 05) to his Annual Summary. 1040ez 2010printable tax forms To figure total monthly net sales, Henry reduces the total monthly receipts by the sales tax imposed on his customers and turned over to the state. 1040ez 2010printable tax forms He cannot take a deduction for sales tax turned over to the state because he only collected the tax. 1040ez 2010printable tax forms He does not include the tax in his income. 1040ez 2010printable tax forms 3. 1040ez 2010printable tax forms Check Disbursements Journal Henry enters checks drawn on the business checking account in the Check Disbursements Journal each day. 1040ez 2010printable tax forms All checks are prenumbered and each check number is listed and accounted for in the column provided in the journal. 1040ez 2010printable tax forms Frequent expenses have their own headings across the sheet. 1040ez 2010printable tax forms He enters in a separate column expenses that require comparatively numerous or large payments each month, such as materials, gross payroll, and rent. 1040ez 2010printable tax forms Under the General Accounts column, he enters small expenses that normally have only one or two monthly payments, such as licenses and postage. 1040ez 2010printable tax forms Henry does not pay personal or nonbusiness expenses by checks drawn on the business account. 1040ez 2010printable tax forms If he did, he would record them in the journal, even though he could not deduct them as business expenses. 1040ez 2010printable tax forms Henry carries the January total of expenses for materials ($1,083. 1040ez 2010printable tax forms 50) to the Annual Summary. 1040ez 2010printable tax forms Similarly, he enters the monthly total of expenses for telephone, truck/auto, etc. 1040ez 2010printable tax forms , in the appropriate columns of that summary. 1040ez 2010printable tax forms 4. 1040ez 2010printable tax forms Employee Compensation Record This record shows the following information. 1040ez 2010printable tax forms The number of hours Henry's employee worked in a pay period. 1040ez 2010printable tax forms The employee's total pay for the period. 1040ez 2010printable tax forms The deductions Henry withheld in figuring the employee's net pay. 1040ez 2010printable tax forms The monthly gross payroll. 1040ez 2010printable tax forms Henry carries the January gross payroll ($520) to the Annual Summary. 1040ez 2010printable tax forms 5. 1040ez 2010printable tax forms Annual Summary This annual summary of monthly cash receipts and expense totals provides the final amounts to enter on Henry's tax return. 1040ez 2010printable tax forms He figures the cash receipts total from the total of monthly cash receipts shown in the Monthly Summary of Cash Receipts. 1040ez 2010printable tax forms He figures the expense totals from the totals of monthly expense items shown in the Check Disbursements Journal. 1040ez 2010printable tax forms As in the journal, he keeps each major expense in a separate column. 1040ez 2010printable tax forms Henry carries the cash receipts total shown in the annual summary ($47,440. 1040ez 2010printable tax forms 9