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1040x Instructions For Dummies

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1040x Instructions For Dummies

1040x instructions for dummies 4. 1040x instructions for dummies   Tax Withholding and Estimated Tax Table of Contents What's New for 2014 Reminders Introduction Useful Items - You may want to see: Tax Withholding for 2014Salaries and Wages Tips Taxable Fringe Benefits Sick Pay Pensions and Annuities Gambling Winnings Unemployment Compensation Federal Payments Backup Withholding Estimated Tax for 2014Who Does Not Have To Pay Estimated Tax Who Must Pay Estimated Tax How To Figure Estimated Tax When To Pay Estimated Tax How To Figure Each Payment How To Pay Estimated Tax Credit for Withholding and Estimated Tax for 2013Withholding Estimated Tax Underpayment Penalty for 2013 What's New for 2014 Tax law changes for 2014. 1040x instructions for dummies  When you figure how much income tax you want withheld from your pay and when you figure your estimated tax, consider tax law changes effective in 2014. 1040x instructions for dummies For more information, see Publication 505. 1040x instructions for dummies Reminders Estimated tax safe harbor for higher income taxpayers. 1040x instructions for dummies  If your 2013 adjusted gross income was more than $150,000 ($75,000 if you are married filing a separate return), you must pay the smaller of 90% of your expected tax for 2014 or 110% of the tax shown on your 2013 return to avoid an estimated tax penalty. 1040x instructions for dummies Introduction This chapter discusses how to pay your tax as you earn or receive income during the year. 1040x instructions for dummies In general, the federal income tax is a pay-as-you-go tax. 1040x instructions for dummies There are two ways to pay as you go. 1040x instructions for dummies Withholding. 1040x instructions for dummies If you are an employee, your employer probably withholds income tax from your pay. 1040x instructions for dummies Tax also may be withheld from certain other income, such as pensions, bonuses, commissions, and gambling winnings. 1040x instructions for dummies The amount withheld is paid to the IRS in your name. 1040x instructions for dummies Estimated tax. 1040x instructions for dummies If you do not pay your tax through withholding, or do not pay enough tax that way, you may have to pay estimated tax. 1040x instructions for dummies People who are in business for themselves generally will have to pay their tax this way. 1040x instructions for dummies Also, you may have to pay estimated tax if you receive income such as dividends, interest, capital gains, rent, and royalties. 1040x instructions for dummies Estimated tax is used to pay not only income tax, but self-employment tax and alternative minimum tax as well. 1040x instructions for dummies This chapter explains these methods. 1040x instructions for dummies In addition, it also explains the following. 1040x instructions for dummies Credit for withholding and estimated tax. 1040x instructions for dummies When you file your 2013 income tax return, take credit for all the income tax withheld from your salary, wages, pensions, etc. 1040x instructions for dummies , and for the estimated tax you paid for 2013. 1040x instructions for dummies Also take credit for any excess social security or railroad retirement tax withheld (discussed in chapter 37). 1040x instructions for dummies Underpayment penalty. 1040x instructions for dummies If you did not pay enough tax during the year, either through withholding or by making estimated tax payments, you may have to pay a penalty. 1040x instructions for dummies In most cases, the IRS can figure this penalty for you. 1040x instructions for dummies See Underpayment Penalty for 2013 at the end of this chapter. 1040x instructions for dummies Useful Items - You may want to see: Publication 505 Tax Withholding and Estimated Tax Form (and Instructions) W-4 Employee's Withholding Allowance Certificate W-4P Withholding Certificate for Pension or Annuity Payments W-4S Request for Federal Income Tax Withholding From Sick Pay W-4V Voluntary Withholding Request 1040-ES Estimated Tax for Individuals 2210 Underpayment of Estimated Tax by Individuals, Estates, and Trusts 2210-F Underpayment of Estimated Tax by Farmers and Fishermen Tax Withholding for 2014 This section discusses income tax withholding on: Salaries and wages, Tips, Taxable fringe benefits, Sick pay, Pensions and annuities, Gambling winnings, Unemployment compensation, and Certain federal payments. 1040x instructions for dummies This section explains the rules for withholding tax from each of these types of income. 1040x instructions for dummies This section also covers backup withholding on interest, dividends, and other payments. 1040x instructions for dummies Salaries and Wages Income tax is withheld from the pay of most employees. 1040x instructions for dummies Your pay includes your regular pay, bonuses, commissions, and vacation allowances. 1040x instructions for dummies It also includes reimbursements and other expense allowances paid under a nonaccountable plan. 1040x instructions for dummies See Supplemental Wages , later, for more information about reimbursements and allowances paid under a nonaccountable plan. 1040x instructions for dummies If your income is low enough that you will not have to pay income tax for the year, you may be exempt from withholding. 1040x instructions for dummies This is explained under Exemption From Withholding , later. 1040x instructions for dummies You can ask your employer to withhold income tax from noncash wages and other wages not subject to withholding. 1040x instructions for dummies If your employer does not agree to withhold tax, or if not enough is withheld, you may have to pay estimated tax, as discussed later under Estimated Tax for 2014 . 1040x instructions for dummies Military retirees. 1040x instructions for dummies   Military retirement pay is treated in the same manner as regular pay for income tax withholding purposes, even though it is treated as a pension or annuity for other tax purposes. 1040x instructions for dummies Household workers. 1040x instructions for dummies   If you are a household worker, you can ask your employer to withhold income tax from your pay. 1040x instructions for dummies A household worker is an employee who performs household work in a private home, local college club, or local fraternity or sorority chapter. 1040x instructions for dummies   Tax is withheld only if you want it withheld and your employer agrees to withhold it. 1040x instructions for dummies If you do not have enough income tax withheld, you may have to pay estimated tax, as discussed later under Estimated Tax for 2014 . 1040x instructions for dummies Farmworkers. 1040x instructions for dummies   Generally, income tax is withheld from your cash wages for work on a farm unless your employer does both of these: Pays you cash wages of less than $150 during the year, and Has expenditures for agricultural labor totaling less than $2,500 during the year. 1040x instructions for dummies Differential wage payments. 1040x instructions for dummies    When employees are on leave from employment for military duty, some employers make up the difference between the military pay and civilian pay. 1040x instructions for dummies Payments to an employee who is on active duty for a period of more than 30 days will be subject to income tax withholding, but not subject to social security or Medicare taxes. 1040x instructions for dummies The wages and withholding will be reported on Form W-2, Wage and Tax Statement. 1040x instructions for dummies   The credit employers can claim for differential wages paid to activated military reservists is scheduled to expire for wages paid after December 31, 2013. 1040x instructions for dummies Determining Amount of Tax Withheld Using Form W-4 The amount of income tax your employer withholds from your regular pay depends on two things. 1040x instructions for dummies The amount you earn in each payroll period. 1040x instructions for dummies The information you give your employer on Form W-4. 1040x instructions for dummies Form W-4 includes four types of information that your employer will use to figure your withholding. 1040x instructions for dummies Whether to withhold at the single rate or at the lower married rate. 1040x instructions for dummies How many withholding allowances you claim (each allowance reduces the amount withheld). 1040x instructions for dummies Whether you want an additional amount withheld. 1040x instructions for dummies Whether you are claiming an exemption from withholding in 2014. 1040x instructions for dummies See Exemption From Withholding , later. 1040x instructions for dummies Note. 1040x instructions for dummies You must specify a filing status and a number of withholding allowances on Form W-4. 1040x instructions for dummies You cannot specify only a dollar amount of withholding. 1040x instructions for dummies New Job When you start a new job, you must fill out Form W-4 and give it to your employer. 1040x instructions for dummies Your employer should have copies of the form. 1040x instructions for dummies If you need to change the information later, you must fill out a new form. 1040x instructions for dummies If you work only part of the year (for example, you start working after the beginning of the year), too much tax may be withheld. 1040x instructions for dummies You may be able to avoid overwithholding if your employer agrees to use the part-year method. 1040x instructions for dummies See Part-Year Method in chapter 1 of Publication 505 for more information. 1040x instructions for dummies Employee also receiving pension income. 1040x instructions for dummies   If you receive pension or annuity income and begin a new job, you will need to file Form W-4 with your new employer. 1040x instructions for dummies However, you can choose to split your withholding allowances between your pension and job in any manner. 1040x instructions for dummies Changing Your Withholding During the year changes may occur to your marital status, exemptions, adjustments, deductions, or credits you expect to claim on your tax return. 1040x instructions for dummies When this happens, you may need to give your employer a new Form W-4 to change your withholding status or your number of allowances. 1040x instructions for dummies If the changes reduce the number of allowances you are claiming or changes your marital status from married to single, you must give your employer a new Form W-4 within 10 days. 1040x instructions for dummies Generally, you can submit a new Form W-4 whenever you wish to change the number of your withholding allowances for any other reason. 1040x instructions for dummies Changing your withholding for 2015. 1040x instructions for dummies   If events in 2014 will decrease the number of your withholding allowances for 2015, you must give your employer a new Form W-4 by December 1, 2014. 1040x instructions for dummies If the event occurs in December 2014, submit a new Form W-4 within 10 days. 1040x instructions for dummies Checking Your Withholding After you have given your employer a Form W-4, you can check to see whether the amount of tax withheld from your pay is too little or too much. 1040x instructions for dummies If too much or too little tax is being withheld, you should give your employer a new Form W-4 to change your withholding. 1040x instructions for dummies You should try to have your withholding match your actual tax liability. 1040x instructions for dummies If not enough tax is withheld, you will owe tax at the end of the year and may have to pay interest and a penalty. 1040x instructions for dummies If too much tax is withheld, you will lose the use of that money until you get your refund. 1040x instructions for dummies Always check your withholding if there are personal or financial changes in your life or changes in the law that might change your tax liability. 1040x instructions for dummies Note. 1040x instructions for dummies You cannot give your employer a payment to cover withholding on salaries and wages for past pay periods or a payment for estimated tax. 1040x instructions for dummies Completing Form W-4 and Worksheets Form W-4 has worksheets to help you figure how many withholding allowances you can claim. 1040x instructions for dummies The worksheets are for your own records. 1040x instructions for dummies Do not give them to your employer. 1040x instructions for dummies Multiple jobs. 1040x instructions for dummies   If you have income from more than one job at the same time, complete only one set of Form W-4 worksheets. 1040x instructions for dummies Then split your allowances between the Forms W-4 for each job. 1040x instructions for dummies You cannot claim the same allowances with more than one employer at the same time. 1040x instructions for dummies You can claim all your allowances with one employer and none with the other(s), or divide them any other way. 1040x instructions for dummies Married individuals. 1040x instructions for dummies   If both you and your spouse are employed and expect to file a joint return, figure your withholding allowances using your combined income, adjustments, deductions, exemptions, and credits. 1040x instructions for dummies Use only one set of worksheets. 1040x instructions for dummies You can divide your total allowances any way, but you cannot claim an allowance that your spouse also claims. 1040x instructions for dummies   If you and your spouse expect to file separate returns, figure your allowances using separate worksheets based on your own individual income, adjustments, deductions, exemptions, and credits. 1040x instructions for dummies Alternative method of figuring withholding allowances. 1040x instructions for dummies   You do not have to use the Form W-4 worksheets if you use a more accurate method of figuring the number of withholding allowances. 1040x instructions for dummies For more information, see Alternative method of figuring withholding allowances under Completing Form W-4 and Worksheets in Publication 505, chapter 1. 1040x instructions for dummies Personal Allowances Worksheet. 1040x instructions for dummies   Use the Personal Allowances Worksheet on Form W-4 to figure your withholding allowances based on exemptions and any special allowances that apply. 1040x instructions for dummies Deduction and Adjustments Worksheet. 1040x instructions for dummies   Use the Deduction and Adjustments Worksheet on Form W-4 if you plan to itemize your deductions, claim certain credits, or claim adjustments to the income on your 2014 tax return and you want to reduce your withholding. 1040x instructions for dummies Also, complete this worksheet when you have changes to these items to see if you need to change your withholding. 1040x instructions for dummies Two-Earners/Multiple Jobs Worksheet. 1040x instructions for dummies   You may need to complete the Two-Earners/Multiple Jobs Worksheet on Form W-4 if you have more than one job, a working spouse, or are also receiving a pension. 1040x instructions for dummies Also, on this worksheet you can add any additional withholding necessary to cover any amount you expect to owe other than income tax, such as self-employment tax. 1040x instructions for dummies Getting the Right Amount of Tax Withheld In most situations, the tax withheld from your pay will be close to the tax you figure on your return if you follow these two rules. 1040x instructions for dummies You accurately complete all the Form W-4 worksheets that apply to you. 1040x instructions for dummies You give your employer a new Form W-4 when changes occur. 1040x instructions for dummies But because the worksheets and withholding methods do not account for all possible situations, you may not be getting the right amount withheld. 1040x instructions for dummies This is most likely to happen in the following situations. 1040x instructions for dummies You are married and both you and your spouse work. 1040x instructions for dummies You have more than one job at a time. 1040x instructions for dummies You have nonwage income, such as interest, dividends, alimony, unemployment compensation, or self-employment income. 1040x instructions for dummies You will owe additional amounts with your return, such as self-employment tax. 1040x instructions for dummies Your withholding is based on obsolete Form W-4 information for a substantial part of the year. 1040x instructions for dummies Your earnings are more than the amount shown under Check your withholding in the instructions at the top of page 1 of Form W-4. 1040x instructions for dummies You work only part of the year. 1040x instructions for dummies You change the number of your withholding allowances during the year. 1040x instructions for dummies Cumulative wage method. 1040x instructions for dummies   If you change the number of your withholding allowances during the year, too much or too little tax may have been withheld for the period before you made the change. 1040x instructions for dummies You may be able to compensate for this if your employer agrees to use the cumulative wage withholding method for the rest of the year. 1040x instructions for dummies You must ask your employer in writing to use this method. 1040x instructions for dummies   To be eligible, you must have been paid for the same kind of payroll period (weekly, biweekly, etc. 1040x instructions for dummies ) since the beginning of the year. 1040x instructions for dummies Publication 505 To make sure you are getting the right amount of tax withheld, get Publication 505. 1040x instructions for dummies It will help you compare the total tax to be withheld during the year with the tax you can expect to figure on your return. 1040x instructions for dummies It also will help you determine how much, if any, additional withholding is needed each payday to avoid owing tax when you file your return. 1040x instructions for dummies If you do not have enough tax withheld, you may have to pay estimated tax, as explained under Estimated Tax for 2014 , later. 1040x instructions for dummies You can use the IRS Withholding Calculator at www. 1040x instructions for dummies irs. 1040x instructions for dummies gov/Individuals, instead of Publication 505 or the worksheets included with Form W-4, to determine whether you need to have your withholding increased or decreased. 1040x instructions for dummies Rules Your Employer Must Follow It may be helpful for you to know some of the withholding rules your employer must follow. 1040x instructions for dummies These rules can affect how to fill out your Form W-4 and how to handle problems that may arise. 1040x instructions for dummies New Form W-4. 1040x instructions for dummies   When you start a new job, your employer should have you complete a Form W-4. 1040x instructions for dummies Beginning with your first payday, your employer will use the information you give on the form to figure your withholding. 1040x instructions for dummies   If you later fill out a new Form W-4, your employer can put it into effect as soon as possible. 1040x instructions for dummies The deadline for putting it into effect is the start of the first payroll period ending 30 or more days after you turn it in. 1040x instructions for dummies No Form W-4. 1040x instructions for dummies   If you do not give your employer a completed Form W-4, your employer must withhold at the highest rate, as if you were single and claimed no withholding allowances. 1040x instructions for dummies Repaying withheld tax. 1040x instructions for dummies   If you find you are having too much tax withheld because you did not claim all the withholding allowances you are entitled to, you should give your employer a new Form W-4. 1040x instructions for dummies Your employer cannot repay any of the tax previously withheld. 1040x instructions for dummies Instead, claim the full amount withheld when you file your tax return. 1040x instructions for dummies   However, if your employer has withheld more than the correct amount of tax for the Form W-4 you have in effect, you do not have to fill out a new Form W-4 to have your withholding lowered to the correct amount. 1040x instructions for dummies Your employer can repay the amount that was withheld incorrectly. 1040x instructions for dummies If you are not repaid, your Form W-2 will reflect the full amount actually withheld, which you would claim when you file your tax return. 1040x instructions for dummies Exemption From Withholding If you claim exemption from withholding, your employer will not withhold federal income tax from your wages. 1040x instructions for dummies The exemption applies only to income tax, not to social security or Medicare tax. 1040x instructions for dummies You can claim exemption from withholding for 2014 only if both of the following situations apply. 1040x instructions for dummies For 2013 you had a right to a refund of all federal income tax withheld because you had no tax liability. 1040x instructions for dummies For 2014 you expect a refund of all federal income tax withheld because you expect to have no tax liability. 1040x instructions for dummies Students. 1040x instructions for dummies   If you are a student, you are not automatically exempt. 1040x instructions for dummies See chapter 1 to find out if you must file a return. 1040x instructions for dummies If you work only part time or only during the summer, you may qualify for exemption from withholding. 1040x instructions for dummies Age 65 or older or blind. 1040x instructions for dummies   If you are 65 or older or blind, use Worksheet 1-3 or 1-4 in chapter 1 of Publication 505, to help you decide if you qualify for exemption from withholding. 1040x instructions for dummies Do not use either worksheet if you will itemize deductions, claim exemptions for dependents, or claim tax credits on your 2014 return. 1040x instructions for dummies Instead, see Itemizing deductions or claiming exemptions or credits in chapter 1 of Publication 505. 1040x instructions for dummies Claiming exemption from withholding. 1040x instructions for dummies   To claim exemption, you must give your employer a Form W-4. 1040x instructions for dummies Do not complete lines 5 and 6. 1040x instructions for dummies Enter “Exempt” on line 7. 1040x instructions for dummies   If you claim exemption, but later your situation changes so that you will have to pay income tax after all, you must file a new Form W-4 within 10 days after the change. 1040x instructions for dummies If you claim exemption in 2014, but you expect to owe income tax for 2015, you must file a new Form W-4 by December 1, 2014. 1040x instructions for dummies   Your claim of exempt status may be reviewed by the IRS. 1040x instructions for dummies An exemption is good for only 1 year. 1040x instructions for dummies   You must give your employer a new Form W-4 by February 15 each year to continue your exemption. 1040x instructions for dummies Supplemental Wages Supplemental wages include bonuses, commissions, overtime pay, vacation allowances, certain sick pay, and expense allowances under certain plans. 1040x instructions for dummies The payer can figure withholding on supplemental wages using the same method used for your regular wages. 1040x instructions for dummies However, if these payments are identified separately from your regular wages, your employer or other payer of supplemental wages can withhold income tax from these wages at a flat rate. 1040x instructions for dummies Expense allowances. 1040x instructions for dummies   Reimbursements or other expense allowances paid by your employer under a nonaccountable plan are treated as supplemental wages. 1040x instructions for dummies   Reimbursements or other expense allowances paid under an accountable plan that are more than your proven expenses are treated as paid under a nonaccountable plan if you do not return the excess payments within a reasonable period of time. 1040x instructions for dummies   For more information about accountable and nonaccountable expense allowance plans, see Reimbursements in chapter 26. 1040x instructions for dummies Penalties You may have to pay a penalty of $500 if both of the following apply. 1040x instructions for dummies You make statements or claim withholding allowances on your Form W-4 that reduce the amount of tax withheld. 1040x instructions for dummies You have no reasonable basis for those statements or allowances at the time you prepare your Form W-4. 1040x instructions for dummies There is also a criminal penalty for willfully supplying false or fraudulent information on your Form W-4 or for willfully failing to supply information that would increase the amount withheld. 1040x instructions for dummies The penalty upon conviction can be either a fine of up to $1,000 or imprisonment for up to 1 year, or both. 1040x instructions for dummies These penalties will apply if you deliberately and knowingly falsify your Form W-4 in an attempt to reduce or eliminate the proper withholding of taxes. 1040x instructions for dummies A simple error or an honest mistake will not result in one of these penalties. 1040x instructions for dummies For example, a person who has tried to figure the number of withholding allowances correctly, but claims seven when the proper number is six, will not be charged a W-4 penalty. 1040x instructions for dummies Tips The tips you receive while working on your job are considered part of your pay. 1040x instructions for dummies You must include your tips on your tax return on the same line as your regular pay. 1040x instructions for dummies However, tax is not withheld directly from tip income, as it is from your regular pay. 1040x instructions for dummies Nevertheless, your employer will take into account the tips you report when figuring how much to withhold from your regular pay. 1040x instructions for dummies See chapter 6 for information on reporting your tips to your employer. 1040x instructions for dummies For more information on the withholding rules for tip income, see Publication 531, Reporting Tip Income. 1040x instructions for dummies How employer figures amount to withhold. 1040x instructions for dummies   The tips you report to your employer are counted as part of your income for the month you report them. 1040x instructions for dummies Your employer can figure your withholding in either of two ways. 1040x instructions for dummies By withholding at the regular rate on the sum of your pay plus your reported tips. 1040x instructions for dummies By withholding at the regular rate on your pay plus a percentage of your reported tips. 1040x instructions for dummies Not enough pay to cover taxes. 1040x instructions for dummies   If your regular pay is not enough for your employer to withhold all the tax (including income tax and social security and Medicare taxes (or the equivalent railroad retirement tax)) due on your pay plus your tips, you can give your employer money to cover the shortage. 1040x instructions for dummies See Giving your employer money for taxes in chapter 6. 1040x instructions for dummies Allocated tips. 1040x instructions for dummies   Your employer should not withhold income tax, Medicare tax, social security tax, or railroad retirement tax on any allocated tips. 1040x instructions for dummies Withholding is based only on your pay plus your reported tips. 1040x instructions for dummies Your employer should refund to you any incorrectly withheld tax. 1040x instructions for dummies See Allocated Tips in chapter 6 for more information. 1040x instructions for dummies Taxable Fringe Benefits The value of certain noncash fringe benefits you receive from your employer is considered part of your pay. 1040x instructions for dummies Your employer generally must withhold income tax on these benefits from your regular pay. 1040x instructions for dummies For information on fringe benefits, see Fringe Benefits under Employee Compensation in chapter 5. 1040x instructions for dummies Although the value of your personal use of an employer-provided car, truck, or other highway motor vehicle is taxable, your employer can choose not to withhold income tax on that amount. 1040x instructions for dummies Your employer must notify you if this choice is made. 1040x instructions for dummies For more information on withholding on taxable fringe benefits, see chapter 1 of Publication 505. 1040x instructions for dummies Sick Pay Sick pay is a payment to you to replace your regular wages while you are temporarily absent from work due to sickness or personal injury. 1040x instructions for dummies To qualify as sick pay, it must be paid under a plan to which your employer is a party. 1040x instructions for dummies If you receive sick pay from your employer or an agent of your employer, income tax must be withheld. 1040x instructions for dummies An agent who does not pay regular wages to you may choose to withhold income tax at a flat rate. 1040x instructions for dummies However, if you receive sick pay from a third party who is not acting as an agent of your employer, income tax will be withheld only if you choose to have it withheld. 1040x instructions for dummies See Form W-4S , later. 1040x instructions for dummies If you receive payments under a plan in which your employer does not participate (such as an accident or health plan where you paid all the premiums), the payments are not sick pay and usually are not taxable. 1040x instructions for dummies Union agreements. 1040x instructions for dummies   If you receive sick pay under a collective bargaining agreement between your union and your employer, the agreement may determine the amount of income tax withholding. 1040x instructions for dummies See your union representative or your employer for more information. 1040x instructions for dummies Form W-4S. 1040x instructions for dummies   If you choose to have income tax withheld from sick pay paid by a third party, such as an insurance company, you must fill out Form W-4S. 1040x instructions for dummies Its instructions contain a worksheet you can use to figure the amount you want withheld. 1040x instructions for dummies They also explain restrictions that may apply. 1040x instructions for dummies   Give the completed form to the payer of your sick pay. 1040x instructions for dummies The payer must withhold according to your directions on the form. 1040x instructions for dummies Estimated tax. 1040x instructions for dummies   If you do not request withholding on Form W-4S, or if you do not have enough tax withheld, you may have to make estimated tax payments. 1040x instructions for dummies If you do not pay enough tax, either through estimated tax or withholding, or a combination of both, you may have to pay a penalty. 1040x instructions for dummies See Underpayment Penalty for 2013 at the end of this chapter. 1040x instructions for dummies Pensions and Annuities Income tax usually will be withheld from your pension or annuity distributions unless you choose not to have it withheld. 1040x instructions for dummies This rule applies to distributions from: A traditional individual retirement arrangement (IRA); A life insurance company under an endowment, annuity, or life insurance contract; A pension, annuity, or profit-sharing plan; A stock bonus plan; and Any other plan that defers the time you receive compensation. 1040x instructions for dummies The amount withheld depends on whether you receive payments spread out over more than 1 year (periodic payments), within 1 year (nonperiodic payments), or as an eligible rollover distribution (ERD). 1040x instructions for dummies Income tax withholding from an ERD is mandatory. 1040x instructions for dummies More information. 1040x instructions for dummies   For more information on taxation of annuities and distributions (including ERDs) from qualified retirement plans, see chapter 10. 1040x instructions for dummies For information on IRAs, see chapter 17. 1040x instructions for dummies For more information on withholding on pensions and annuities, including a discussion of Form W-4P, see Pensions and Annuities in chapter 1 of Publication 505. 1040x instructions for dummies Gambling Winnings Income tax is withheld at a flat 25% rate from certain kinds of gambling winnings. 1040x instructions for dummies Gambling winnings of more than $5,000 from the following sources are subject to income tax withholding. 1040x instructions for dummies Any sweepstakes; wagering pool, including payments made to winners of poker tournaments; or lottery. 1040x instructions for dummies Any other wager, if the proceeds are at least 300 times the amount of the bet. 1040x instructions for dummies It does not matter whether your winnings are paid in cash, in property, or as an annuity. 1040x instructions for dummies Winnings not paid in cash are taken into account at their fair market value. 1040x instructions for dummies Exception. 1040x instructions for dummies   Gambling winnings from bingo, keno, and slot machines generally are not subject to income tax withholding. 1040x instructions for dummies However, you may need to provide the payer with a social security number to avoid withholding. 1040x instructions for dummies See Backup withholding on gambling winnings in chapter 1 of Publication 505. 1040x instructions for dummies If you receive gambling winnings not subject to withholding, you may need to pay estimated tax. 1040x instructions for dummies See Estimated Tax for 2014 , later. 1040x instructions for dummies If you do not pay enough tax, either through withholding or estimated tax, or a combination of both, you may have to pay a penalty. 1040x instructions for dummies See Underpayment Penalty for 2013 at the end of this chapter. 1040x instructions for dummies Form W-2G. 1040x instructions for dummies   If a payer withholds income tax from your gambling winnings, you should receive a Form W-2G, Certain Gambling Winnings, showing the amount you won and the amount withheld. 1040x instructions for dummies Report the tax withheld on line 62 of Form 1040. 1040x instructions for dummies Unemployment Compensation You can choose to have income tax withheld from unemployment compensation. 1040x instructions for dummies To make this choice, fill out Form W-4V (or a similar form provided by the payer) and give it to the payer. 1040x instructions for dummies All unemployment compensation is taxable. 1040x instructions for dummies So, if you do not have income tax withheld, you may have to pay estimated tax. 1040x instructions for dummies See Estimated Tax for 2014 , later. 1040x instructions for dummies If you do not pay enough tax, either through withholding or estimated tax, or a combination of both, you may have to pay a penalty. 1040x instructions for dummies For information, see Underpayment Penalty for 2013 at the end of this chapter. 1040x instructions for dummies Federal Payments You can choose to have income tax withheld from certain federal payments you receive. 1040x instructions for dummies These payments are: Social security benefits, Tier 1 railroad retirement benefits, Commodity credit corporation loans you choose to include in your gross income, Payments under the Agricultural Act of 1949 (7 U. 1040x instructions for dummies S. 1040x instructions for dummies C. 1040x instructions for dummies 1421 et. 1040x instructions for dummies seq. 1040x instructions for dummies ), as amended, or title II of the Disaster Assistance Act of 1988, that are treated as insurance proceeds and that you receive because: Your crops were destroyed or damaged by drought, flood, or any other natural disaster, or You were unable to plant crops because of a natural disaster described in (a), and Any other payment under Federal law as determined by the Secretary. 1040x instructions for dummies To make this choice, fill out Form W-4V (or a similar form provided by the payer) and give it to the payer. 1040x instructions for dummies If you do not choose to have income tax withheld, you may have to pay estimated tax. 1040x instructions for dummies See Estimated Tax for 2014 , later. 1040x instructions for dummies If you do not pay enough tax, either through withholding or estimated tax, or a combination of both, you may have to pay a penalty. 1040x instructions for dummies For information, see Underpayment Penalty for 2013 at the end of this chapter. 1040x instructions for dummies More information. 1040x instructions for dummies   For more information about the tax treatment of social security and railroad retirement benefits, see chapter 11. 1040x instructions for dummies Get Publication 225, Farmer's Tax Guide, for information about the tax treatment of commodity credit corporation loans or crop disaster payments. 1040x instructions for dummies Backup Withholding Banks or other businesses that pay you certain kinds of income must file an information return (Form 1099) with the IRS. 1040x instructions for dummies The information return shows how much you were paid during the year. 1040x instructions for dummies It also includes your name and taxpayer identification number (TIN). 1040x instructions for dummies TINs are explained in chapter 1 under Social Security Number (SSN) . 1040x instructions for dummies These payments generally are not subject to withholding. 1040x instructions for dummies However, “backup” withholding is required in certain situations. 1040x instructions for dummies Backup withholding can apply to most kinds of payments that are reported on Form 1099. 1040x instructions for dummies The payer must withhold at a flat 28% rate in the following situations. 1040x instructions for dummies You do not give the payer your TIN in the required manner. 1040x instructions for dummies The IRS notifies the payer that the TIN you gave is incorrect. 1040x instructions for dummies You are required, but fail, to certify that you are not subject to backup withholding. 1040x instructions for dummies The IRS notifies the payer to start withholding on interest or dividends because you have underreported interest or dividends on your income tax return. 1040x instructions for dummies The IRS will do this only after it has mailed you four notices over at least a 210-day period. 1040x instructions for dummies See Backup Withholding in chapter 1 of Publication 505 for more information. 1040x instructions for dummies Penalties. 1040x instructions for dummies   There are civil and criminal penalties for giving false information to avoid backup withholding. 1040x instructions for dummies The civil penalty is $500. 1040x instructions for dummies The criminal penalty, upon conviction, is a fine of up to $1,000 or imprisonment of up to 1 year, or both. 1040x instructions for dummies Estimated Tax for 2014 Estimated tax is the method used to pay tax on income that is not subject to withholding. 1040x instructions for dummies This includes income from self-employment, interest, dividends, alimony, rent, gains from the sale of assets, prizes, and awards. 1040x instructions for dummies You also may have to pay estimated tax if the amount of income tax being withheld from your salary, pension, or other income is not enough. 1040x instructions for dummies Estimated tax is used to pay both income tax and self-employment tax, as well as other taxes and amounts reported on your tax return. 1040x instructions for dummies If you do not pay enough tax, either through withholding or estimated tax, or a combination of both, you may have to pay a penalty. 1040x instructions for dummies If you do not pay enough by the due date of each payment period (see When To Pay Estimated Tax , later), you may be charged a penalty even if you are due a refund when you file your tax return. 1040x instructions for dummies For information on when the penalty applies, see Underpayment Penalty for 2013 at the end of this chapter. 1040x instructions for dummies Who Does Not Have To Pay Estimated Tax If you receive salaries or wages, you can avoid having to pay estimated tax by asking your employer to take more tax out of your earnings. 1040x instructions for dummies To do this, give a new Form W-4 to your employer. 1040x instructions for dummies See chapter 1 of Publication 505. 1040x instructions for dummies Estimated tax not required. 1040x instructions for dummies   You do not have to pay estimated tax for 2014 if you meet all three of the following conditions. 1040x instructions for dummies You had no tax liability for 2013. 1040x instructions for dummies You were a U. 1040x instructions for dummies S. 1040x instructions for dummies citizen or resident alien for the whole year. 1040x instructions for dummies Your 2013 tax year covered a 12-month period. 1040x instructions for dummies   You had no tax liability for 2013 if your total tax was zero or you did not have to file an income tax return. 1040x instructions for dummies For the definition of “total tax” for 2013, see Publication 505, chapter 2. 1040x instructions for dummies Who Must Pay Estimated Tax If you owe additional tax for 2013, you may have to pay estimated tax for 2014. 1040x instructions for dummies You can use the following general rule as a guide during the year to see if you will have enough withholding, or if you should increase your withholding or make estimated tax payments. 1040x instructions for dummies General rule. 1040x instructions for dummies   In most cases, you must pay estimated tax for 2014 if both of the following apply. 1040x instructions for dummies You expect to owe at least $1,000 in tax for 2014, after subtracting your withholding and refundable credits. 1040x instructions for dummies You expect your withholding plus your refundable credits to be less than the smaller of: 90% of the tax to be shown on your 2014 tax return, or 100% of the tax shown on your 2013 tax return (but see Special rules for farmers, fishermen, and higher income taxpayers, later). 1040x instructions for dummies Your 2013 tax return must cover all 12 months. 1040x instructions for dummies    If the result from using the general rule above suggests that you will not have enough withholding, complete the 2014 Estimated Tax Worksheet in Publication 505 for a more accurate calculation. 1040x instructions for dummies Special rules for farmers, fishermen, and higher income taxpayers. 1040x instructions for dummies   If at least two-thirds of your gross income for tax year 2013 or 2014 is from farming or fishing, substitute 662/3% for 90% in (2a) under the General rule, earlier. 1040x instructions for dummies If your AGI for 2013 was more than $150,000 ($75,000 if your filing status for 2014 is married filing a separate return), substitute 110% for 100% in (2b) under General rule , earlier. 1040x instructions for dummies See Figure 4-A and Publication 505, chapter 2 for more information. 1040x instructions for dummies Figure 4-A. 1040x instructions for dummies Do You Have To Pay Estimated Tax? Please click here for the text description of the image. 1040x instructions for dummies Figure 4-A Do You Have To Pay Estimated Tax? Aliens. 1040x instructions for dummies   Resident and nonresident aliens also may have to pay estimated tax. 1040x instructions for dummies Resident aliens should follow the rules in this chapter unless noted otherwise. 1040x instructions for dummies Nonresident aliens should get Form 1040-ES (NR), U. 1040x instructions for dummies S. 1040x instructions for dummies Estimated Tax for Nonresident Alien Individuals. 1040x instructions for dummies   You are an alien if you are not a citizen or national of the United States. 1040x instructions for dummies You are a resident alien if you either have a green card or meet the substantial presence test. 1040x instructions for dummies For more information about the substantial presence test, see Publication 519, U. 1040x instructions for dummies S. 1040x instructions for dummies Tax Guide for Aliens. 1040x instructions for dummies Married taxpayers. 1040x instructions for dummies   If you qualify to make joint estimated tax payments, apply the rules discussed here to your joint estimated income. 1040x instructions for dummies   You and your spouse can make joint estimated tax payments even if you are not living together. 1040x instructions for dummies   However, you and your spouse cannot make joint estimated tax payments if:  You are legally separated under a decree of divorce or separate maintenance, You and your spouse have different tax years, or Either spouse is a nonresident alien (unless that spouse elected to be treated as a resident alien for tax purposes (see chapter 1 of Publication 519)). 1040x instructions for dummies   If you do not qualify to make joint estimated tax payments, apply these rules to your separate estimated income. 1040x instructions for dummies Making joint or separate estimated tax payments will not affect your choice of filing a joint tax return or separate returns for 2014. 1040x instructions for dummies 2013 separate returns and 2014 joint return. 1040x instructions for dummies   If you plan to file a joint return with your spouse for 2014, but you filed separate returns for 2013, your 2013 tax is the total of the tax shown on your separate returns. 1040x instructions for dummies You filed a separate return if you filed as single, head of household, or married filing separately. 1040x instructions for dummies 2013 joint return and 2014 separate returns. 1040x instructions for dummies   If you plan to file a separate return for 2014 but you filed a joint return for 2013, your 2013 tax is your share of the tax on the joint return. 1040x instructions for dummies You file a separate return if you file as single, head of household, or married filing separately. 1040x instructions for dummies   To figure your share of the tax on the joint return, first figure the tax both you and your spouse would have paid had you filed separate returns for 2013 using the same filing status as for 2014. 1040x instructions for dummies Then multiply the tax on the joint return by the following fraction. 1040x instructions for dummies     The tax you would have paid had you filed a separate return   The total tax you and your spouse would have paid had you filed separate returns Example. 1040x instructions for dummies Joe and Heather filed a joint return for 2013 showing taxable income of $48,500 and a tax of $6,386. 1040x instructions for dummies Of the $48,500 taxable income, $40,100 was Joe's and the rest was Heather's. 1040x instructions for dummies For 2014, they plan to file married filing separately. 1040x instructions for dummies Joe figures his share of the tax on the 2013 joint return as follows. 1040x instructions for dummies   Tax on $40,100 based on a separate return $5,960     Tax on $8,400 based on a separate return 843     Total $6,803     Joe's percentage of total ($5,960 ÷ $6,803) 87. 1040x instructions for dummies 6%     Joe's share of tax on joint return  ($6,386 × 87. 1040x instructions for dummies 6%) $5,594   How To Figure Estimated Tax To figure your estimated tax, you must figure your expected adjusted gross income (AGI), taxable income, taxes, deductions, and credits for the year. 1040x instructions for dummies When figuring your 2014 estimated tax, it may be helpful to use your income, deductions, and credits for 2013 as a starting point. 1040x instructions for dummies Use your 2013 federal tax return as a guide. 1040x instructions for dummies You can use Form 1040-ES and Publication 505 to figure your estimated tax. 1040x instructions for dummies Nonresident aliens use Form 1040-ES (NR) and Publication 505 to figure estimated tax (see chapter 8 of Publication 519 for more information). 1040x instructions for dummies You must make adjustments both for changes in your own situation and for recent changes in the tax law. 1040x instructions for dummies For a discussion of these changes, visit IRS. 1040x instructions for dummies gov. 1040x instructions for dummies For more complete information on how to figure your estimated tax for 2014, see chapter 2 of Publication 505. 1040x instructions for dummies When To Pay Estimated Tax For estimated tax purposes, the tax year is divided into four payment periods. 1040x instructions for dummies Each period has a specific payment due date. 1040x instructions for dummies If you do not pay enough tax by the due date of each payment period, you may be charged a penalty even if you are due a refund when you file your income tax return. 1040x instructions for dummies The payment periods and due dates for estimated tax payments are shown next. 1040x instructions for dummies   For the period: Due date:*     Jan. 1040x instructions for dummies 1 – March 31 April 15     April 1 – May 31 June 16     June 1 – August 31 Sept. 1040x instructions for dummies 15     Sept. 1040x instructions for dummies 1– Dec. 1040x instructions for dummies 31 Jan. 1040x instructions for dummies 15, next year     *See Saturday, Sunday, holiday rule and January payment . 1040x instructions for dummies Saturday, Sunday, holiday rule. 1040x instructions for dummies   If the due date for an estimated tax payment falls on a Saturday, Sunday, or legal holiday, the payment will be on time if you make it on the next day that is not a Saturday, Sunday, or legal holiday. 1040x instructions for dummies January payment. 1040x instructions for dummies   If you file your 2014 Form 1040 or Form 1040A by January 31, 2015, and pay the rest of the tax you owe, you do not need to make the payment due on January 15, 2015. 1040x instructions for dummies Fiscal year taxpayers. 1040x instructions for dummies   If your tax year does not start on January 1, see the Form 1040-ES instructions for your payment due dates. 1040x instructions for dummies When To Start You do not have to make estimated tax payments until you have income on which you will owe income tax. 1040x instructions for dummies If you have income subject to estimated tax during the first payment period, you must make your first payment by the due date for the first payment period. 1040x instructions for dummies You can pay all your estimated tax at that time, or you can pay it in installments. 1040x instructions for dummies If you choose to pay in installments, make your first payment by the due date for the first payment period. 1040x instructions for dummies Make your remaining installment payments by the due dates for the later periods. 1040x instructions for dummies No income subject to estimated tax during first period. 1040x instructions for dummies    If you do not have income subject to estimated tax until a later payment period, you must make your first payment by the due date for that period. 1040x instructions for dummies You can pay your entire estimated tax by the due date for that period or you can pay it in installments by the due date for that period and the due dates for the remaining periods. 1040x instructions for dummies The following chart shows when to make installment payments. 1040x instructions for dummies If you first have income on which you must pay estimated tax: Make a payment  by:* Make later installments by:* Before April 1 April 15 June 16 Sept. 1040x instructions for dummies 15 Jan. 1040x instructions for dummies 15 next year April 1–May 31 June 16 Sept. 1040x instructions for dummies 15 Jan. 1040x instructions for dummies 15 next year June 1–Aug. 1040x instructions for dummies 31 Sept. 1040x instructions for dummies 15 Jan. 1040x instructions for dummies 15 next year After Aug. 1040x instructions for dummies 31 Jan. 1040x instructions for dummies 15 next year (None) *See Saturday, Sunday, holiday rule and January payment . 1040x instructions for dummies How much to pay to avoid a penalty. 1040x instructions for dummies   To determine how much you should pay by each payment due date, see How To Figure Each Payment, next. 1040x instructions for dummies How To Figure Each Payment You should pay enough estimated tax by the due date of each payment period to avoid a penalty for that period. 1040x instructions for dummies You can figure your required payment for each period by using either the regular installment method or the annualized income installment method. 1040x instructions for dummies These methods are described in chapter 2 of Publication 505. 1040x instructions for dummies If you do not pay enough during each payment period, you may be charged a penalty even if you are due a refund when you file your tax return. 1040x instructions for dummies If the earlier discussion of No income subject to estimated tax during first period or the later discussion of Change in estimated tax applies to you, you may benefit from reading Annualized Income Installment Method in chapter 2 of Publication 505 for information on how to avoid a penalty. 1040x instructions for dummies Underpayment penalty. 1040x instructions for dummies   Under the regular installment method, if your estimated tax payment for any period is less than one-fourth of your estimated tax, you may be charged a penalty for underpayment of estimated tax for that period when you file your tax return. 1040x instructions for dummies Under the annualized income installment method, your estimated tax payments vary with your income, but the amount required must be paid each period. 1040x instructions for dummies See chapter 4 of Publication 505 for more information. 1040x instructions for dummies Change in estimated tax. 1040x instructions for dummies   After you make an estimated tax payment, changes in your income, adjustments, deductions, credits, or exemptions may make it necessary for you to refigure your estimated tax. 1040x instructions for dummies Pay the unpaid balance of your amended estimated tax by the next payment due date after the change or in installments by that date and the due dates for the remaining payment periods. 1040x instructions for dummies Estimated Tax Payments Not Required You do not have to pay estimated tax if your withholding in each payment period is at least as much as: One-fourth of your required annual payment, or Your required annualized income installment for that period. 1040x instructions for dummies You also do not have to pay estimated tax if you will pay enough through withholding to keep the amount you owe with your return under $1,000. 1040x instructions for dummies How To Pay Estimated Tax There are several ways to pay estimated tax. 1040x instructions for dummies Credit an overpayment on your 2013 return to your 2014 estimated tax. 1040x instructions for dummies Pay by direct transfer from your bank account, or pay by credit or debit card using a pay-by-phone system or the Internet. 1040x instructions for dummies Send in your payment (check or money order) with a payment voucher from Form 1040-ES. 1040x instructions for dummies Credit an Overpayment If you show an overpayment of tax after completing your Form 1040 or Form 1040A for 2013, you can apply part or all of it to your estimated tax for 2014. 1040x instructions for dummies On line 75 of Form 1040, or line 44 of Form 1040A, enter the amount you want credited to your estimated tax rather than refunded. 1040x instructions for dummies Take the amount you have credited into account when figuring your estimated tax payments. 1040x instructions for dummies You cannot have any of the amount you credited to your estimated tax refunded to you until you file your tax return for the following year. 1040x instructions for dummies You also cannot use that overpayment in any other way. 1040x instructions for dummies Pay Online Paying online is convenient and secure and helps make sure we get your payments on time. 1040x instructions for dummies You can pay using either of the following electronic payment methods. 1040x instructions for dummies Direct transfer from your bank account. 1040x instructions for dummies Credit or debit card. 1040x instructions for dummies To pay your taxes online or for more information, go to www. 1040x instructions for dummies irs. 1040x instructions for dummies gov/e-pay. 1040x instructions for dummies Pay by Phone Paying by phone is another safe and secure method of paying electronically. 1040x instructions for dummies Use one of the following methods. 1040x instructions for dummies Direct transfer from your bank account. 1040x instructions for dummies Credit or debit card. 1040x instructions for dummies To pay by direct transfer from your bank account, call 1-800-555-4477 (English), 1-800-244-4829 (Espanol). 1040x instructions for dummies People who are deaf, hard of hearing, or have a speech disability and who have access to TTY/TDD can call 1-800-733-4829. 1040x instructions for dummies To pay using a credit or debit card, you can call one of the following service providers. 1040x instructions for dummies There is a convenience fee charged by these providers that varies by provider, card type, and payment amount. 1040x instructions for dummies WorldPay 1-888-9-PAY-TAXTM(1-888-972-9829) www. 1040x instructions for dummies payUSAtax. 1040x instructions for dummies com Official Payments Corporation 1-888-UPAY-TAXTM (1-888-872-9829) www. 1040x instructions for dummies officialpayments. 1040x instructions for dummies com Link2Gov Corporation 1-888-PAY-1040TM (1-888-729-1040) www. 1040x instructions for dummies PAY1040. 1040x instructions for dummies com For the latest details on how to pay by phone, go to www. 1040x instructions for dummies irs. 1040x instructions for dummies gov/e-pay. 1040x instructions for dummies Pay by Check or Money Order Using the Estimated Tax Payment Voucher Each payment of estimated tax by check or money order must be accompanied by a payment voucher from Form 1040-ES. 1040x instructions for dummies During 2013, if you: made at least one estimated tax payment but not by electronic means, did not use software or a paid preparer to prepare or file your return,  then you should receive a copy of the 2014 Form 1040-ES/V. 1040x instructions for dummies The enclosed payment vouchers will be preprinted with your name, address, and social security number. 1040x instructions for dummies Using the preprinted vouchers will speed processing, reduce the chance of error, and help save processing costs. 1040x instructions for dummies Use the window envelopes that came with your Form 1040-ES package. 1040x instructions for dummies If you use your own envelopes, make sure you mail your payment vouchers to the address shown in the Form 1040-ES instructions for the place where you live. 1040x instructions for dummies Note. 1040x instructions for dummies These criteria can change without notice. 1040x instructions for dummies If you do not receive a Form 1040-ES/V package and you are required to make an estimated tax payment, you should go to www. 1040x instructions for dummies irs. 1040x instructions for dummies gov and print a copy of Form 1040-ES which includes four blank payment vouchers. 1040x instructions for dummies Complete one of these and make your payment timely to avoid penalties for paying late. 1040x instructions for dummies Do not use the address shown in the Form 1040 or Form 1040A instructions for your estimated tax payments. 1040x instructions for dummies If you did not pay estimated tax last year, you can order Form 1040-ES from the IRS (see inside back cover of this publication) or download it from IRS. 1040x instructions for dummies gov. 1040x instructions for dummies Follow the instructions to make sure you use the vouchers correctly. 1040x instructions for dummies Joint estimated tax payments. 1040x instructions for dummies   If you file a joint return and are making joint estimated tax payments, enter the names and social security numbers on the payment voucher in the same order as they will appear on the joint return. 1040x instructions for dummies Change of address. 1040x instructions for dummies   You must notify the IRS if you are making estimated tax payments and you changed your address during the year. 1040x instructions for dummies Complete Form 8822, Change of Address, and mail it to the address shown in the instructions for that form. 1040x instructions for dummies Credit for Withholding and Estimated Tax for 2013 When you file your 2013 income tax return, take credit for all the income tax and excess social security or railroad retirement tax withheld from your salary, wages, pensions, etc. 1040x instructions for dummies Also take credit for the estimated tax you paid for 2013. 1040x instructions for dummies These credits are subtracted from your total tax. 1040x instructions for dummies Because these credits are refundable, you should file a return and claim these credits, even if you do not owe tax. 1040x instructions for dummies Two or more employers. 1040x instructions for dummies   If you had two or more employers in 2013 and were paid wages of more than $113,700, too much social security or tier 1 railroad retirement tax may have been withheld from your pay. 1040x instructions for dummies You may be able to claim the excess as a credit against your income tax when you file your return. 1040x instructions for dummies See Credit for Excess Social Security Tax or Railroad Retirement Tax Withheld in chapter 37. 1040x instructions for dummies Withholding If you had income tax withheld during 2013, you should be sent a statement by January 31, 2014, showing your income and the tax withheld. 1040x instructions for dummies Depending on the source of your income, you should receive: Form W-2, Wage and Tax Statement, Form W-2G, Certain Gambling Winnings, or A form in the 1099 series. 1040x instructions for dummies Forms W-2 and W-2G. 1040x instructions for dummies   If you file a paper return, always file Form W-2 with your income tax return. 1040x instructions for dummies File Form W-2G with your return only if it shows any federal income tax withheld from your winnings. 1040x instructions for dummies   You should get at least two copies of each form. 1040x instructions for dummies If you file a paper return, attach one copy to the front of your federal income tax return. 1040x instructions for dummies Keep one copy for your records. 1040x instructions for dummies You also should receive copies to file with your state and local returns. 1040x instructions for dummies Form W-2 Your employer is required to provide or send Form W-2 to you no later than January 31, 2014. 1040x instructions for dummies You should receive a separate Form W-2 from each employer you worked for. 1040x instructions for dummies If you stopped working before the end of 2013, your employer could have given you your Form W-2 at any time after you stopped working. 1040x instructions for dummies However, your employer must provide or send it to you by January 31, 2014. 1040x instructions for dummies If you ask for the form, your employer must send it to you within 30 days after receiving your written request or within 30 days after your final wage payment, whichever is later. 1040x instructions for dummies If you have not received your Form W-2 by January 31, you should ask your employer for it. 1040x instructions for dummies If you do not receive it by February 15, call the IRS. 1040x instructions for dummies Form W-2 shows your total pay and other compensation and the income tax, social security tax, and Medicare tax that was withheld during the year. 1040x instructions for dummies Include the federal income tax withheld (as shown in box 2 of Form W-2) on: Line 62 if you file Form 1040, Line 36 if you file Form 1040A, or Line 7 if you file Form 1040EZ. 1040x instructions for dummies In addition, Form W-2 is used to report any taxable sick pay you received and any income tax withheld from your sick pay. 1040x instructions for dummies Form W-2G If you had gambling winnings in 2013, the payer may have withheld income tax. 1040x instructions for dummies If tax was withheld, the payer will give you a Form W-2G showing the amount you won and the amount of tax withheld. 1040x instructions for dummies Report the amounts you won on line 21 of Form 1040. 1040x instructions for dummies Take credit for the tax withheld on line 62 of Form 1040. 1040x instructions for dummies If you had gambling winnings, you must use Form 1040; you cannot use Form 1040A or Form 1040EZ. 1040x instructions for dummies The 1099 Series Most forms in the 1099 series are not filed with your return. 1040x instructions for dummies These forms should be furnished to you by January 31, 2014 (or, for Forms 1099-B, 1099-S, and certain Forms 1099-MISC, by February 15, 2014). 1040x instructions for dummies Unless instructed to file any of these forms with your return, keep them for your records. 1040x instructions for dummies There are several different forms in this series, including: Form 1099-B, Proceeds From Broker and Barter Exchange Transactions; Form 1099-DIV, Dividends and Distributions; Form 1099-G, Certain Government Payments; Form 1099-INT, Interest Income; Form 1099-K, Payment Card and Third Party Network Transactions; Form 1099-MISC, Miscellaneous Income; Form 1099-OID, Original Issue Discount; Form 1099-PATR, Taxable Distributions Received from Cooperatives; Form 1099-Q, Payments From Qualified Education Programs; Form 1099-R, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc. 1040x instructions for dummies ; Form 1099-S, Proceeds From Real Estate Transactions; Form RRB-1099, Payments by the Railroad Retirement Board. 1040x instructions for dummies If you received the types of income reported on some forms in the 1099 series, you may not be able to use Form 1040A or Form 1040EZ. 1040x instructions for dummies See the instructions to these forms for details. 1040x instructions for dummies Form 1099-R. 1040x instructions for dummies   Attach Form 1099-R to your paper return if box 4 shows federal income tax withheld. 1040x instructions for dummies Include the amount withheld in the total on line 62 of Form 1040 or line 36 of Form 1040A. 1040x instructions for dummies You cannot use Form 1040EZ if you received payments reported on Form 1099-R. 1040x instructions for dummies Backup withholding. 1040x instructions for dummies   If you were subject to backup withholding on income you received during 2013, include the amount withheld, as shown on your Form 1099, in the total on line 62 of Form 1040, line 36 of Form 1040A, or line 7 of Form 1040EZ. 1040x instructions for dummies Form Not Correct If you receive a form with incorrect information on it, you should ask the payer for a corrected form. 1040x instructions for dummies Call the telephone number or write to the address given for the payer on the form. 1040x instructions for dummies The corrected Form W-2G or Form 1099 you receive will have an “X” in the “CORRECTED” box at the top of the form. 1040x instructions for dummies A special form, Form W-2c, Corrected Wage and Tax Statement, is used to correct a Form W-2. 1040x instructions for dummies In certain situations, you will receive two forms in place of the original incorrect form. 1040x instructions for dummies This will happen when your taxpayer identification number is wrong or missing, your name and address are wrong, or you received the wrong type of form (for example, a Form 1099-DIV instead of a Form 1099-INT). 1040x instructions for dummies One new form you receive will be the same incorrect form or have the same incorrect information, but all money amounts will be zero. 1040x instructions for dummies This form will have an “X” in the “CORRECTED” box at the top of the form. 1040x instructions for dummies The second new form should have all the correct information, prepared as though it is the original (the “CORRECTED” box will not be checked). 1040x instructions for dummies Form Received After Filing If you file your return and you later receive a form for income that you did not include on your return, you should report the income and take credit for any income tax withheld by filing Form 1040X, Amended U. 1040x instructions for dummies S. 1040x instructions for dummies Individual Income Tax Return. 1040x instructions for dummies Separate Returns If you are married but file a separate return, you can take credit only for the tax withheld from your own income. 1040x instructions for dummies Do not include any amount withheld from your spouse's income. 1040x instructions for dummies However, different rules may apply if you live in a community property state. 1040x instructions for dummies Community property states are listed in chapter 2. 1040x instructions for dummies For more information on these rules, and some exceptions, see Publication 555, Community Property. 1040x instructions for dummies Fiscal Years If you file your tax return on the basis of a fiscal year (a 12-month period ending on the last day of any month except December), you must follow special rules to determine your credit for federal income tax withholding. 1040x instructions for dummies For a discussion of how to take credit for withholding on a fiscal year return, see Fiscal Years (FY) in chapter 3 of Publication 505. 1040x instructions for dummies Estimated Tax Take credit for all your estimated tax payments for 2013 on line 63 of Form 1040 or line 37 of Form 1040A. 1040x instructions for dummies Include any overpayment from 2012 that you had credited to your 2013 estimated tax. 1040x instructions for dummies You must use Form 1040 or Form 1040A if you paid estimated tax. 1040x instructions for dummies You cannot use Form 1040EZ. 1040x instructions for dummies Name changed. 1040x instructions for dummies   If you changed your name, and you made estimated tax payments using your old name, attach a brief statement to the front of your paper tax return indicating: When you made the payments, The amount of each payment, Your name when you made the payments, and Your social security number. 1040x instructions for dummies The statement should cover payments you made jointly with your spouse as well as any you made separately. 1040x instructions for dummies   Be sure to report the change to the Social Security Administration. 1040x instructions for dummies This prevents delays in processing your return and issuing any refunds. 1040x instructions for dummies Separate Returns If you and your spouse made separate estimated tax payments for 2013 and you file separate returns, you can take credit only for your own payments. 1040x instructions for dummies If you made joint estimated tax payments, you must decide how to divide the payments between your returns. 1040x instructions for dummies One of you can claim all of the estimated tax paid and the other none, or you can divide it in any other way you agree on. 1040x instructions for dummies If you cannot agree, you must divide the payments in proportion to each spouse's individual tax as shown on your separate returns for 2013. 1040x instructions for dummies Divorced Taxpayers If you made joint estimated tax payments for 2013, and you were divorced during the year, either you or your former spouse can claim all of the joint payments, or you each can claim part of them. 1040x instructions for dummies If you cannot agree on how to divide the payments, you must divide them in proportion to each spouse's individual tax as shown on your separate returns for 2013. 1040x instructions for dummies If you claim any of the joint payments on your tax return, enter your former spouse's social security number (SSN) in the space provided on the front of Form 1040 or Form 1040A. 1040x instructions for dummies If you divorced and remarried in 2013, enter your present spouse's SSN in that space and write your former spouse's SSN, followed by “DIV,” to the left of Form 1040, line 63, or Form 1040A, line 37. 1040x instructions for dummies Underpayment Penalty for 2013 If you did not pay enough tax, either through withholding or by making timely estimated tax payments, you will have an underpayment of estimated tax and you may have to pay a penalty. 1040x instructions for dummies Generally, you will not have to pay a penalty for 2013 if any of the following apply. 1040x instructions for dummies The total of your withholding and estimated tax payments was at least as much as your 2012 tax (or 110% of your 2012 tax if your AGI was more than $150,000, $75,000 if your 2013 filing status is married filing separately) and you paid all required estimated tax payments on time. 1040x instructions for dummies The tax balance due on your 2013 return is no more than 10% of your total 2013 tax, and you paid all required estimated tax payments on time. 1040x instructions for dummies Your total 2013 tax minus your withholding and refundable credits is less than $1,000. 1040x instructions for dummies You did not have a tax liability for 2012 and your 2012 tax year was 12 months, or You did not have any withholding taxes and your current year tax less any household employment taxes is less than $1,000. 1040x instructions for dummies See Publication 505, chapter 4, for a definition of “total tax” for 2012 and 2013. 1040x instructions for dummies Farmers and fishermen. 1040x instructions for dummies   Special rules apply if you are a farmer or fisherman. 1040x instructions for dummies See Farmers and Fishermen in chapter 4 of Publication 505 for more information. 1040x instructions for dummies IRS can figure the penalty for you. 1040x instructions for dummies   If you think you owe the penalty but you do not want to figure it yourself when you file your tax return, you may not have to. 1040x instructions for dummies Generally, the IRS will figure the penalty for you and send you a bill. 1040x instructions for dummies However, if you think you are able to lower or eliminate your penalty, you must complete Form 2210 or Form 2210-F and attach it to your paper return. 1040x instructions for dummies See chapter 4 of Publication 505. 1040x instructions for dummies Prev  Up  Next   Home   More Online Publications
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The 1040x Instructions For Dummies

1040x instructions for dummies Publication 514 - Introductory Material Table of Contents Reminders IntroductionOrdering forms and publications. 1040x instructions for dummies Tax questions. 1040x instructions for dummies Useful Items - You may want to see: Reminders Future developments. 1040x instructions for dummies  For the latest information about developments related to Pub. 1040x instructions for dummies 514, such as legislation enacted after it was published, go to www. 1040x instructions for dummies irs. 1040x instructions for dummies gov/pub514. 1040x instructions for dummies Alternative minimum tax. 1040x instructions for dummies  In addition to your regular income tax, you may be liable for the alternative minimum tax. 1040x instructions for dummies A foreign tax credit may be allowed in figuring this tax. 1040x instructions for dummies See the instructions for Form 6251, Alternative Minimum Tax—Individuals, for a discussion of the alternative minimum tax foreign tax credit. 1040x instructions for dummies Change of address. 1040x instructions for dummies  If your address changes from the address shown on your last return, use Form 8822, Change of Address, to notify the Internal Revenue Service. 1040x instructions for dummies Photographs of missing children. 1040x instructions for dummies  The Internal Revenue Service is a proud partner with the National Center for Missing and Exploited Children. 1040x instructions for dummies Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. 1040x instructions for dummies You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child. 1040x instructions for dummies Introduction If you paid or accrued foreign taxes to a foreign country on foreign source income and are subject to U. 1040x instructions for dummies S. 1040x instructions for dummies tax on the same income, you may be able to take either a credit or an itemized deduction for those taxes. 1040x instructions for dummies Taken as a deduction, foreign income taxes reduce your U. 1040x instructions for dummies S. 1040x instructions for dummies taxable income. 1040x instructions for dummies Taken as a credit, foreign income taxes reduce your U. 1040x instructions for dummies S. 1040x instructions for dummies tax liability. 1040x instructions for dummies In most cases, it is to your advantage to take foreign income taxes as a tax credit. 1040x instructions for dummies The major scope of this publication is the foreign tax credit. 1040x instructions for dummies The publication discusses: How to choose to take the credit or the deduction, Who can take the credit, What foreign taxes qualify for the credit, How to figure the credit, and How to carry over unused foreign taxes to other tax years. 1040x instructions for dummies Unless you qualify for exemption from the foreign tax credit limit, you claim the credit by filing Form 1116 with your U. 1040x instructions for dummies S. 1040x instructions for dummies income tax return. 1040x instructions for dummies Two examples with filled-in Forms 1116 are provided at the end of this publication. 1040x instructions for dummies Comments and suggestions. 1040x instructions for dummies   We welcome your comments about this publication and your suggestions for future editions. 1040x instructions for dummies   You can write to us at the following address: Internal Revenue Service Tax Forms and Publications Division 1111 Constitution Ave. 1040x instructions for dummies NW, IR-6526 Washington, DC 20224   We respond to many letters by telephone. 1040x instructions for dummies Therefore, it would be helpful if you would include your daytime phone number, including the area code, in your correspondence. 1040x instructions for dummies   You can send your comments from www. 1040x instructions for dummies irs. 1040x instructions for dummies gov/formspubs/. 1040x instructions for dummies Click on “More Information” and then on “Comment on Tax Forms and Publications”. 1040x instructions for dummies   Although we cannot respond individually to each comment received, we do appreciate your feedback and will consider your comments as we revise our tax products. 1040x instructions for dummies Ordering forms and publications. 1040x instructions for dummies   Visit www. 1040x instructions for dummies irs. 1040x instructions for dummies gov/formspubs/ to download forms and publications, call 1-800-TAX-FORM (1-800-829-3676), or write to the address below and receive a response within 10 days after your request is received. 1040x instructions for dummies Internal Revenue Service 1201 N. 1040x instructions for dummies Mitsubishi Motorway Bloomington, IL 61705-6613 Tax questions. 1040x instructions for dummies   If you have a tax question, check the information available on IRS. 1040x instructions for dummies gov or call 1-800-829-1040. 1040x instructions for dummies We cannot answer tax questions sent to either of the above addresses. 1040x instructions for dummies Useful Items - You may want to see: Publication 54 Tax Guide for U. 1040x instructions for dummies S. 1040x instructions for dummies Citizens and Resident Aliens Abroad 519 U. 1040x instructions for dummies S. 1040x instructions for dummies Tax Guide for Aliens 570 Tax Guide for Individuals With Income From U. 1040x instructions for dummies S. 1040x instructions for dummies Possessions Form (and Instructions) 1116 Foreign Tax Credit See How To Get Tax Help near the end of this publication for information about getting these publications and this form. 1040x instructions for dummies Prev  Up  Next   Home   More Online Publications