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2009 1040

2009 1040 Publication 721 - Main Content Table of Contents Part I General InformationRefund of Contributions Tax Withholding and Estimated Tax Filing Requirements Part II Rules for RetireesAnnuity starting date. 2009 1040 Gross monthly rate. 2009 1040 Your cost. 2009 1040 Choosing a survivor annuity after retirement. 2009 1040 Canceling a survivor annuity after retirement. 2009 1040 Annuity starting date after 1986. 2009 1040 Annuity starting date before 1987. 2009 1040 Simplified Method General Rule Three-Year Rule Alternative Annuity Option Federal Gift Tax Retirement During the Past Year Reemployment After Retirement Nonresident Aliens Thrift Savings Plan Rollover Rules Distributions Used To Pay Insurance Premiums for Public Safety Officers How To Report Benefits Part III Rules for Disability Retirement and Credit for the Elderly or the DisabledDisability Annuity Other Benefits Credit for the Elderly or the Disabled Part IV Rules for Survivors of Federal EmployeesFERS Death Benefit CSRS or FERS Survivor Annuity Lump-Sum CSRS or FERS Payment Thrift Savings Plan Federal Estate Tax Part V Rules for Survivors of Federal RetireesCSRS or FERS Survivor Annuity Lump-Sum CSRS or FERS Payment Voluntary Contributions Thrift Savings Plan Federal Estate Tax Income Tax Deduction for Estate Tax Paid How To Get Tax HelpLow Income Taxpayer Clinics Part I General Information This part of the publication contains information that can apply to most recipients of civil service retirement benefits. 2009 1040 Refund of Contributions If you leave federal government service or transfer to a job not under the CSRS or FERS and you are not eligible for an immediate annuity, you can choose to receive a refund of the money in your CSRS or FERS retirement account. 2009 1040 The refund will include both regular and voluntary contributions you made to the fund, plus any interest payable. 2009 1040 If the refund includes only your contributions, none of the refund is taxable. 2009 1040 If it includes any interest, the interest is taxable unless you roll it over directly into another qualified plan or a traditional individual retirement arrangement (IRA). 2009 1040 If you do not have the Office of Personnel Management (OPM) transfer the interest to an IRA or other plan in a direct rollover, tax will be withheld at a 20% rate. 2009 1040 See Rollover Rules in Part II for information on how to make a rollover. 2009 1040 Interest is not paid on contributions to the CSRS for service after 1956 unless your service was for more than 1 year but not more than 5 years. 2009 1040 Therefore, many employees who withdraw their contributions under the CSRS do not get interest and do not owe any tax on their refund. 2009 1040 If you do not roll over interest included in your refund, it may qualify as a lump-sum distribution eligible for capital gain treatment or the 10-year tax option. 2009 1040 If you separate from service before the calendar year in which you reach age 55, it may be subject to an additional 10% tax on early distributions. 2009 1040 For more information, see Lump-Sum Distributions and Tax on Early Distributions in Publication 575. 2009 1040 A lump-sum distribution is eligible for capital gain treatment or the 10-year tax option only if the plan participant was born before January 2, 1936. 2009 1040 Tax Withholding and Estimated Tax The CSRS or FERS annuity you receive is subject to federal income tax withholding, unless you choose not to have tax withheld. 2009 1040 OPM will tell you how to make the choice. 2009 1040 The choice for no withholding remains in effect until you change it. 2009 1040 These withholding rules also apply to a disability annuity, whether received before or after minimum retirement age. 2009 1040 If you choose not to have tax withheld, or if you do not have enough tax withheld, you may have to make estimated tax payments. 2009 1040 You may owe a penalty if the total of your withheld tax and estimated tax does not cover most of the tax shown on your return. 2009 1040 Generally, you will owe the penalty for 2014 if the additional tax you must pay with your return is $1,000 or more and more than 10% of the tax to be shown on your 2014 return. 2009 1040 For more information, including exceptions to the penalty, see chapter 4 of Publication 505, Tax Withholding and Estimated Tax. 2009 1040 Form CSA 1099R. 2009 1040   Form CSA 1099R is mailed to you by OPM each year. 2009 1040 It will show any tax you had withheld. 2009 1040 File a copy of Form CSA 1099R with your tax return if any federal income tax was withheld. 2009 1040    You also can view and download your Form CSA 1099R by visiting the OPM website at  www. 2009 1040 servicesonline. 2009 1040 opm. 2009 1040 gov. 2009 1040 To log in, you will need your retirement CSA claim number and your personal identification number. 2009 1040 Choosing no withholding on payments outside the United States. 2009 1040   The choice for no withholding generally cannot be made for annuity payments to be delivered outside the United States and its possessions. 2009 1040   To choose no withholding if you are a U. 2009 1040 S. 2009 1040 citizen or resident alien, you must provide OPM with your home address in the United States or its possessions. 2009 1040 Otherwise, OPM has to withhold tax. 2009 1040 For example, OPM must withhold if you provide a U. 2009 1040 S. 2009 1040 address for a nominee, trustee, or agent (such as a bank) to whom the benefits are to be delivered, but you do not provide your own U. 2009 1040 S. 2009 1040 home address. 2009 1040   If you do not provide a home address in the United States or its possessions, you can choose not to have tax withheld only if you certify to OPM that you are not a U. 2009 1040 S. 2009 1040 citizen, a U. 2009 1040 S. 2009 1040 resident alien, or someone who left the United States to avoid tax. 2009 1040 But if you so certify, you may be subject to the 30% flat rate withholding that applies to nonresident aliens. 2009 1040 For details, see Publication 519, U. 2009 1040 S. 2009 1040 Tax Guide for Aliens. 2009 1040 Withholding certificate. 2009 1040   If you give OPM a Form W-4P-A, Election of Federal Income Tax Withholding, you can choose not to have tax withheld or you can choose to have tax withheld. 2009 1040 The amount of tax withheld depends on your marital status, the number of withholding allowances, and any additional amount you designate to be withheld. 2009 1040 If you do not make either of these choices, OPM must withhold as if you were married with three withholding allowances. 2009 1040 To change the amount of tax withholding or to stop withholding, call OPM's Retirement Information Office at 1-888-767-6738 (customers within the local Washington, D. 2009 1040 C. 2009 1040 calling area must call 202-606-0500). 2009 1040 No special form is needed. 2009 1040 You will need your retirement CSA or CSF claim number, your social security number, and your personal identification number (PIN) when you call. 2009 1040 If you have TTY/TDD equipment, call 1-855–887–4957. 2009 1040 If you need a PIN, call OPM's Retirement Information Office. 2009 1040 You also can change the amount of withholding or stop withholding online by visiting the OPM website at www. 2009 1040 servicesonline. 2009 1040 opm. 2009 1040 gov. 2009 1040 You will need your retirement CSA or CSF claim number and your PIN. 2009 1040 Withholding from certain lump-sum payments. 2009 1040   If you leave the federal government before becoming eligible to retire and you apply for a refund of your CSRS or FERS contributions, or you die without leaving a survivor eligible for an annuity, you or your beneficiary will receive a distribution of your contributions to the retirement plan plus any interest payable. 2009 1040 Tax will be withheld at a 20% rate on the interest distributed. 2009 1040 However, tax will not be withheld if you have OPM transfer (roll over) the interest directly to your traditional IRA or other qualified plan. 2009 1040 If you have OPM transfer (roll over) the interest directly to a Roth IRA, the entire amount will be taxed in the current year. 2009 1040 Because no income tax will be withheld at the time of the transfer, you may want to increase your withholding or pay estimated taxes. 2009 1040 See Rollover Rules in Part II. 2009 1040 If you receive only your contributions, no tax will be withheld. 2009 1040 Withholding from Thrift Savings Plan payments. 2009 1040   Generally, a distribution that you receive from the TSP is subject to federal income tax withholding. 2009 1040 The amount withheld is: 20% if the distribution is an eligible rollover distribution, 10% if it is a nonperiodic distribution other than an eligible rollover distribution, or An amount determined as if you were married with three withholding allowances, unless you submit a withholding certificate (Form W-4P), if it is a periodic distribution. 2009 1040  However, you usually can choose not to have tax withheld from TSP payments other than eligible rollover distributions. 2009 1040 By January 31 after the end of the year in which you receive a distribution, the TSP will issue Form 1099-R showing the total distributions you received in the prior year and the amount of tax withheld. 2009 1040   For a detailed discussion of withholding on distributions from the TSP, see Important Tax Information About Payments From Your TSP Account, available from your agency personnel office or from the TSP. 2009 1040 The above document is also available in the “Forms & Publications” section of the TSP website at www. 2009 1040 tsp. 2009 1040 gov. 2009 1040 Estimated tax. 2009 1040   Generally, you must make estimated tax payments for 2014 if you expect to owe at least $1,000 in tax for 2014 (after subtracting your withholding and credits) and you expect your withholding and your credits to be less than the smaller of: 90% of the tax to be shown on your income tax return for 2014, or 100% of the tax shown on your 2013 income tax return (110% of that amount if the adjusted gross income shown on the return was more than $150,000 ($75,000 if your filing status for 2014 will be married filing separately)). 2009 1040 The return must cover all 12 months. 2009 1040   You do not have to pay estimated tax for 2014 if you were a U. 2009 1040 S. 2009 1040 citizen or resident alien for all of 2013 and you had no tax liability for the full 12-month 2013 tax year. 2009 1040   Publication 505 contains information that you can use to help you figure your estimated tax payments. 2009 1040 Filing Requirements If your gross income, including the taxable part of your annuity, is less than a certain amount, you generally do not have to file a federal income tax return for that year. 2009 1040 The gross income filing requirements for the tax year are in the instructions to Form 1040, 1040A, or 1040EZ. 2009 1040 Children. 2009 1040   If you are the surviving spouse of a federal employee or retiree and your monthly annuity check includes a survivor annuity for one or more children, each child's annuity counts as his or her own income (not yours) for federal income tax purposes. 2009 1040   If your child can be claimed as a dependent, treat the taxable part of his or her annuity as unearned income when applying the filing requirements for dependents. 2009 1040 Form CSF 1099R. 2009 1040   Form CSF 1099R will be mailed to you by January 31 after the end of each tax year. 2009 1040 It will show the total amount of the annuity you received in the past year. 2009 1040 It also should show, separately, the survivor annuity for a child or children. 2009 1040 Only the part that is each individual's survivor annuity should be shown on that individual's Form 1040 or 1040A. 2009 1040   If your Form CSF 1099R does not show separately the amount paid to you for a child or children, attach a statement to your return, along with a copy of Form CSF 1099R, explaining why the amount shown on the tax return differs from the amount shown on Form CSF 1099R. 2009 1040    You also can view and download your Form CSF 1099R by visiting the OPM website at  www. 2009 1040 servicesonline. 2009 1040 opm. 2009 1040 gov. 2009 1040 To log in you will need your retirement CSF claim number and personal identification number. 2009 1040    You may request a Summary of Payments, showing the amounts paid to you for your child(ren), from OPM by calling OPM's Retirement Information Office at 1-888-767-6738 (customers within the local Washington, D. 2009 1040 C. 2009 1040 calling area must call 202-606-0500). 2009 1040 You will need your CSF claim number and your social security number when you call. 2009 1040 Taxable part of annuity. 2009 1040   To find the taxable part of a retiree's annuity when applying the filing requirements, see the discussion in Part II, Rules for Retirees , or Part III, Rules for Disability Retirement and Credit for the Elderly or the Disabled , whichever applies. 2009 1040 To find the taxable part of each survivor annuity when applying the filing requirements, see the discussion in Part IV, Rules for Survivors of Federal Employees , or Part V, Rules for Survivors of Federal Retirees , whichever applies. 2009 1040 Part II Rules for Retirees This part of the publication is for retirees who retired on nondisability retirement. 2009 1040 If you retired on disability before you reached your minimum retirement age, see Part III, Rules for Disability Retirement and Credit for the Elderly or the Disabled. 2009 1040 However, on the day after you reach your minimum retirement age, use the rules in this section to report your disability retirement and begin recovering your cost. 2009 1040 Annuity statement. 2009 1040   The statement you received from OPM when your CSRS or FERS annuity was approved shows the commencing date (the annuity starting date), the gross monthly rate of your annuity benefit, and your total contributions to the retirement plan (your cost). 2009 1040 You will use this information to figure the tax-free recovery of your cost. 2009 1040 Annuity starting date. 2009 1040   If you retire from federal government service on a regular annuity, your annuity starting date is the commencing date on your annuity statement from OPM. 2009 1040 If something delays payment of your annuity, such as a late application for retirement, it does not affect the date your annuity begins to accrue or your annuity starting date. 2009 1040 Gross monthly rate. 2009 1040   This is the amount you were to get after any adjustment for electing a survivor's annuity or for electing the lump-sum payment under the alternative annuity option (if either applied) but before any deduction for income tax withholding, insurance premiums, etc. 2009 1040 Your cost. 2009 1040   Your monthly annuity payment contains an amount on which you have previously paid income tax. 2009 1040 This amount represents part of your contributions to the retirement plan. 2009 1040 Even though you did not receive the money that was contributed to the plan, it was included in your gross income for federal income tax purposes in the years it was taken out of your pay. 2009 1040   The cost of your annuity is the total of your contributions to the retirement plan, as shown on your annuity statement from OPM. 2009 1040 If you elected the alternative annuity option, it includes any deemed deposits and any deemed redeposits that were added to your lump-sum credit. 2009 1040 (See Lump-sum credit under Alternative Annuity Option, later. 2009 1040 )   If you repaid contributions that you had withdrawn from the retirement plan earlier, or if you paid into the plan to receive full credit for service not subject to retirement deductions, the entire repayment, including any interest, is a part of your cost. 2009 1040 You cannot claim an interest deduction for any interest payments. 2009 1040 You cannot treat these payments as voluntary contributions; they are considered regular employee contributions. 2009 1040 Recovering your cost tax free. 2009 1040   How you figure the tax-free recovery of the cost of your CSRS or FERS annuity depends on your annuity starting date. 2009 1040 If your annuity starting date is before July 2, 1986, either the Three-Year Rule or the General Rule (both discussed later) applies to your annuity. 2009 1040 If your annuity starting date is after July 1, 1986, and before November 19, 1996, you could have chosen to use either the General Rule or the Simplified Method (discussed later). 2009 1040 If your annuity starting date is after November 18, 1996, you must use the Simplified Method. 2009 1040   Under both the General Rule and the Simplified Method, each of your monthly annuity payments is made up of two parts: the tax-free part that is a return of your cost, and the taxable part that is the amount of each payment that is more than the part that represents your cost (unless such payment is used for purposes discussed under Distributions Used To Pay Insurance Premiums for Public Safety Officers , later). 2009 1040 The tax-free part is a fixed dollar amount. 2009 1040 It remains the same, even if your annuity is increased. 2009 1040 Generally, this rule applies as long as you receive your annuity. 2009 1040 However, see Exclusion limit , later. 2009 1040 Choosing a survivor annuity after retirement. 2009 1040    If you retired without a survivor annuity and report your annuity under the Simplified Method, do not change your tax-free monthly amount even if you later choose a survivor annuity. 2009 1040   If you retired without a survivor annuity and report your annuity under the General Rule, you must figure the tax-free part of your annuity using a new exclusion percentage if you later choose a survivor annuity and take reduced annuity payments. 2009 1040 To figure the new exclusion percentage, reduce your cost by the amount you previously recovered tax free. 2009 1040 Figure the expected return as of the date the reduced annuity begins. 2009 1040 For details on the General Rule, see Publication 939. 2009 1040 Canceling a survivor annuity after retirement. 2009 1040   If you retired with a survivor annuity payable to your spouse upon your death and you notify OPM that your marriage has ended, your annuity might be increased to remove the reduction for a survivor benefit. 2009 1040 The increased annuity does not change the cost recovery you figured at the annuity starting date. 2009 1040 The tax-free part of each annuity payment remains the same. 2009 1040    For more information about choosing or canceling a survivor annuity after retirement, contact OPM's Retirement Information Office at 1-888-767-6738 (customers within the local Washington, D. 2009 1040 C. 2009 1040 calling area must call 202-606-0500). 2009 1040 Exclusion limit. 2009 1040   Your annuity starting date determines the total amount of annuity payments that you can exclude from income over the years. 2009 1040 Annuity starting date after 1986. 2009 1040   If your annuity starting date is after 1986, the total amount of annuity income that you (or the survivor annuitant) can exclude over the years as a return of your cost cannot exceed your total cost. 2009 1040 Annuity payments you or your survivors receive after the total cost in the plan has been recovered are generally fully taxable. 2009 1040 Example. 2009 1040 Your annuity starting date is after 1986 and you exclude $100 a month under the Simplified Method. 2009 1040 If your cost is $12,000, the exclusion ends after 10 years (120 months). 2009 1040 Thereafter, your entire annuity is generally fully taxable. 2009 1040 Annuity starting date before 1987. 2009 1040   If your annuity starting date is before 1987, you can continue to take your monthly exclusion figured under the General Rule or Simplified Method for as long as you receive your annuity. 2009 1040 If you chose a joint and survivor annuity, your survivor can continue to take that same exclusion. 2009 1040 The total exclusion may be more than your cost. 2009 1040 Deduction of unrecovered cost. 2009 1040   If your annuity starting date is after July 1, 1986, and the cost of your annuity has not been fully recovered at your (or the survivor annuitant's) death, a deduction is allowed for the unrecovered cost. 2009 1040 The deduction is claimed on your (or your survivor's) final tax return as a miscellaneous itemized deduction (not subject to the 2%-of-adjusted-gross-income limit). 2009 1040 If your annuity starting date is before July 2, 1986, no tax benefit is allowed for any unrecovered cost at death. 2009 1040 Simplified Method If your annuity starting date is after November 18, 1996, you must use the Simplified Method to figure the tax-free part of your CSRS or FERS annuity. 2009 1040 (OPM has figured the taxable amount of your annuity shown on your Form CSA 1099R using the Simplified Method. 2009 1040 ) You could have chosen to use either the Simplified Method or the General Rule if your annuity starting date is after July 1, 1986, but before November 19, 1996. 2009 1040 The Simplified Method does not apply if your annuity starting date is before July 2, 1986. 2009 1040 Under the Simplified Method, you figure the tax-free part of each full monthly payment by dividing your cost by a number of months based on your age. 2009 1040 This number will differ depending on whether your annuity starting date is before November 19, 1996, or after November 18, 1996. 2009 1040 If your annuity starting date is after 1997 and your annuity includes a survivor benefit for your spouse, this number is based on your combined ages. 2009 1040 Worksheet A. 2009 1040   Use Worksheet A. 2009 1040 Simplified Method (near the end of this publication), to figure your taxable annuity. 2009 1040 Be sure to keep the completed worksheet. 2009 1040 It will help you figure your taxable amounts for later years. 2009 1040 Instead of Worksheet A, you generally can use the Simplified Method Worksheet in the instructions for Form 1040, Form 1040A, or Form 1040NR to figure your taxable annuity. 2009 1040 However, you must use Worksheet A and Worksheet B in this publication if you chose the alternative annuity option, discussed later. 2009 1040 Line 2. 2009 1040   See Your cost , earlier, for an explanation of your cost in the plan. 2009 1040 If your annuity starting date is after November 18, 1996, and you chose the alternative annuity option (explained later), you must reduce your cost by the tax-free part of the lump-sum payment you received. 2009 1040 Line 3. 2009 1040   The number you enter on line 3 is the appropriate number from Table 1 or 2 representing approximate life expectancies in months. 2009 1040 If your annuity starting date is after 1997, use: Table 1 for an annuity without a survivor benefit, or Table 2 for an annuity with a survivor benefit. 2009 1040 If your annuity starting date is before 1998, use Table 1. 2009 1040 Line 6. 2009 1040   If you received contributions tax free before 2013, the amount previously recovered tax free that you must enter on line 6 is the total amount from line 10 of last year's worksheet. 2009 1040 If your annuity starting date is before November 19, 1996, and you chose the alternative annuity option, this amount includes the tax-free part of the lump-sum payment you received. 2009 1040 Example. 2009 1040 Bill Smith retired from the Federal Government on March 31, 2013, under an annuity that will provide a survivor benefit for his wife, Kathy. 2009 1040 His annuity starting date is April 1, 2013, the annuity is paid in arrears, and he received his first monthly annuity payment on May 1, 2013. 2009 1040 He must use the Simplified Method to figure the tax-free part of his annuity benefits. 2009 1040 Bill's monthly annuity benefit is $1,000. 2009 1040 He had contributed $31,000 to his retirement plan and had received no distributions before his annuity starting date. 2009 1040 At his annuity starting date, he was 65 and Kathy was 57. 2009 1040 Bill's completed Worksheet A is shown later. 2009 1040 To complete line 3, he used Table 2 at the bottom of the worksheet and found that 310 is the number in the second column opposite the age range that includes 122 (his and Kathy's combined ages). 2009 1040 Bill keeps a copy of the completed worksheet for his records. 2009 1040 It will help him (and Kathy, if she survives him) figure the taxable amount of the annuity in later years. 2009 1040 Bill's tax-free monthly amount is $100. 2009 1040 (See line 4 of the worksheet. 2009 1040 ) If he lives to collect more than 310 monthly payments, he will generally have to include in his gross income the full amount of any annuity payments received after 310 payments have been made. 2009 1040 If Bill does not live to collect 310 monthly payments and his wife begins to receive monthly payments, she also will exclude $100 from each monthly payment until 310 payments (Bill's and hers) have been collected. 2009 1040 If she dies before 310 payments have been made, a miscellaneous itemized deduction (not subject to the 2%-of-adjusted- gross-income limit) will be allowed for the unrecovered cost on her final income tax return. 2009 1040 General Rule If your annuity starting date is after November 18, 1996, you cannot use the General Rule to figure the tax-free part of your CSRS or FERS annuity. 2009 1040 If your annuity starting date is after July 1, 1986, but before November 19, 1996, you could have chosen to use either the General Rule or the Simplified Method. 2009 1040 If your annuity starting date is before July 2, 1986, you could have chosen to use the General Rule only if you could not use the Three-Year Rule. 2009 1040 Under the General Rule, you figure the tax-free part of each full monthly payment by multiplying the initial gross monthly rate of your annuity by an exclusion percentage. 2009 1040 Figuring this percentage is complex and requires the use of actuarial tables. 2009 1040 For these tables and other information about using the General Rule, see Publication 939. 2009 1040 Three-Year Rule If your annuity starting date was before July 2, 1986, you probably had to report your annuity using the Three-Year Rule. 2009 1040 Under this rule, you excluded all the annuity payments from income until you fully recovered your cost. 2009 1040 After your cost was recovered, all payments became fully taxable. 2009 1040 You cannot use another rule to again exclude amounts from income. 2009 1040 The Three-Year Rule was repealed for retirees whose annuity starting date is after July 1, 1986. 2009 1040 Worksheet A. 2009 1040 Simplified Method for Bill Smith See the instructions in Part II of this publication under Simplified Method. 2009 1040 1. 2009 1040 Enter the total pension or annuity payments received this year. 2009 1040 Also, add this amount to the total for Form 1040, line 16a; Form 1040A, line 12a; or Form 1040NR, line 17a 1. 2009 1040 $ 8,000 2. 2009 1040 Enter your cost in the plan at the annuity starting date, plus any death benefit exclusion*. 2009 1040 See Your cost in Part II, Rules for Retirees, earlier 2. 2009 1040 31,000 Note: If your annuity starting date was before this year and you completed this worksheet last year, skip line 3 and enter the amount from line 4 of last year's worksheet on line 4 below (even if the amount of your pension or annuity has changed). 2009 1040 Otherwise, go to line 3. 2009 1040   3. 2009 1040 Enter the appropriate number from Table 1 below. 2009 1040 But if your annuity starting date was after 1997 and the payments are for your life and that of your beneficiary, enter the appropriate number from Table 2 below. 2009 1040 3. 2009 1040 310 4. 2009 1040 Divide line 2 by the number on line 3 4. 2009 1040 100 5. 2009 1040 Multiply line 4 by the number of months for which this year's payments were made. 2009 1040 If your annuity starting date was before 1987, enter this amount on line 8 below and skip lines 6, 7, 10, and 11. 2009 1040 Otherwise, go to line 6 5. 2009 1040 800 6. 2009 1040 Enter any amounts previously recovered tax free in years after 1986. 2009 1040 This is the amount shown on line 10 of your worksheet for last year 6. 2009 1040 0 7. 2009 1040 Subtract line 6 from line 2 7. 2009 1040 31,000 8. 2009 1040 Enter the smaller of line 5 or line 7 8. 2009 1040 800 9. 2009 1040 Taxable amount for year. 2009 1040 Subtract line 8 from line 1. 2009 1040 Enter the result, but not less than zero. 2009 1040 Also, add this amount to the total for Form 1040, line 16b, or Form 1040A, line 12b. 2009 1040 If you are a nonresident alien, also enter this amount on line 1 of Worksheet C. 2009 1040 If your Form CSA 1099R or Form CSF 1099R shows a larger amount, use the amount figured on this line instead. 2009 1040 If you are a retired public safety officer, see Distributions Used To Pay Insurance Premiums for Public Safety Officers in Part II before entering an amount on your tax return or Worksheet C, line 1 9. 2009 1040 $7,200 10. 2009 1040 Was your annuity starting date before 1987?   Yes. 2009 1040 Do not complete the rest of this worksheet. 2009 1040    No. 2009 1040 Add lines 6 and 8. 2009 1040 This is the amount you have recovered tax free through 2013. 2009 1040 You will need this number if you need to fill out this worksheet next year 10. 2009 1040 800 11. 2009 1040 Balance of cost to be recovered. 2009 1040 Subtract line 10 from line 2. 2009 1040 If zero, you will not have to complete this worksheet next year. 2009 1040 The payments you receive next year will generally be fully taxable 11. 2009 1040 $30,200 Table 1 for Line 3 Above    IF your age on your  annuity starting date was   AND your annuity starting date was—     before November 19, 1996,  THEN enter on line 3 after November 18, 1996,  THEN enter on line 3   55 or under 300 360   56–60 260 310   61–65 240 260   66–70 170 210   71 or over 120 160  Table 2 for Line 3 Above    IF the annuitants' combined ages on your annuity starting date were   THEN enter on line 3         110 or under   410         111–120   360         121–130   310         131–140   260         141 or over   210       * A death benefit exclusion of up to $5,000 applied to certain benefits received by survivors of employees who died before August 21, 1996. 2009 1040 Alternative Annuity Option If you are eligible, you may choose an alternative form of annuity. 2009 1040 If you make this choice, you will receive a lump-sum payment equal to your contributions to the plan and a reduced monthly annuity. 2009 1040 You are eligible to make this choice if you meet all of the following requirements. 2009 1040 You are retiring, but not on disability. 2009 1040 You have a life-threatening illness or other critical medical condition. 2009 1040 You do not have a former spouse entitled to court ordered benefits based on your service. 2009 1040 If you are not eligible or do not choose this alternative annuity, you can skip the following discussion and go to Federal Gift Tax , later. 2009 1040 Lump-Sum Payment The lump-sum payment you receive under the alternative annuity option generally has a tax-free part and a taxable part. 2009 1040 The tax-free part represents part of your cost. 2009 1040 The taxable part represents part of the earnings on your annuity contract. 2009 1040 Your lump-sum credit (discussed later) may include a deemed deposit or redeposit that is treated as being included in your lump-sum payment even though you do not actually receive such amounts. 2009 1040 Deemed deposits and redeposits, which are described later under Lump-sum credit , are taxable to you in the year of retirement. 2009 1040 Your taxable amount may therefore be more than the lump-sum payment you receive. 2009 1040 You must include the taxable part of the lump-sum payment in your income for the year you receive the payment unless you roll it over into another qualified plan or an IRA. 2009 1040 If you do not have OPM transfer the taxable amount to an IRA or other plan in a direct rollover, tax will be withheld at a 20% rate. 2009 1040 See Rollover Rules , later, for information on how to make a rollover. 2009 1040 OPM can make a direct rollover only up to the amount of the lump-sum payment. 2009 1040 Therefore, to defer tax on the full taxable amount if it is more than the payment, you must add funds from another source. 2009 1040 The taxable part of the lump-sum payment does not qualify as a lump-sum distribution eligible for capital gain treatment or the 10-year tax option. 2009 1040 It also may be subject to an additional 10% tax on early distributions if you separate from service before the calendar year in which you reach age 55, even if you reach age 55 in the year you receive the lump-sum payment. 2009 1040 For more information, see Lump-Sum Distributions and Tax on Early Distributions in Publication 575. 2009 1040 Worksheet B. 2009 1040   Use Worksheet B. 2009 1040 Lump-Sum Payment (near the end of this publication), to figure the taxable part of your lump-sum payment. 2009 1040 Be sure to keep the completed worksheet for your records. 2009 1040   To complete the worksheet, you will need to know the amount of your lump-sum credit and the present value of your annuity contract. 2009 1040 Lump-sum credit. 2009 1040   Generally, this is the same amount as the lump-sum payment you receive (the total of your contributions to the retirement system). 2009 1040 However, for purposes of the alternative annuity option, your lump-sum credit also may include deemed deposits and redeposits that OPM advanced to your retirement account so that you are given credit for the service they represent. 2009 1040 Deemed deposits (including interest) are for federal employment during which no retirement contributions were taken out of your pay. 2009 1040 Deemed redeposits (including interest) are for any refunds of retirement contributions that you received and did not repay. 2009 1040 You are treated as if you had received a lump-sum payment equal to the amount of your lump-sum credit and then had made a repayment to OPM of the advanced amounts. 2009 1040 Present value of your annuity contract. 2009 1040   The present value of your annuity contract is figured using actuarial tables provided by the IRS. 2009 1040 If you are receiving a lump-sum payment under the Alternative Annuity Option, you can write to the address below to find out the present value of your annuity contract. 2009 1040 Internal Revenue Service Attn: Actuarial Group 2 TE/GE SE:T:EP:RA:T:A2 NCA-629 1111 Constitution Ave. 2009 1040 , NW Washington, DC 20224-0002 Example. 2009 1040 David Brown retired from the federal government in 2013, one month after his 55th birthday. 2009 1040 He had contributed $31,000 to his retirement plan and chose to receive a lump-sum payment of that amount under the alternative annuity option. 2009 1040 The present value of his annuity contract was $155,000. 2009 1040 The tax-free part and the taxable part of the lump-sum payment are figured using Worksheet B, as shown below. 2009 1040 The taxable part ($24,800) is also his net cost in the plan, which is used to figure the taxable part of his reduced annuity payments. 2009 1040 See Reduced Annuity , later. 2009 1040 Worksheet B. 2009 1040 Lump-Sum Payment for David Brown See the instructions in Part II of this publication under Alternative Annuity Option . 2009 1040  1. 2009 1040 Enter your lump-sum credit (your cost in the plan at the annuity starting date) 1. 2009 1040 $ 31,000 2. 2009 1040 Enter the present value of your annuity contract 2. 2009 1040 155,000 3. 2009 1040 Divide line 1 by line 2 3. 2009 1040 . 2009 1040 20 4. 2009 1040 Tax-free amount. 2009 1040 Multiply line 1 by line 3. 2009 1040 (Caution: Do not include this amount on line 6 of Worksheet A in this publication. 2009 1040 ) 4. 2009 1040 $6,200 5. 2009 1040 Taxable amount (net cost in the plan). 2009 1040 Subtract line 4 from line 1. 2009 1040 Include this amount in the total on Form 1040, line 16b; Form 1040A, line 12b; or Form 1040NR, line 17b. 2009 1040 Also, enter this amount on line 2 of Worksheet A in this publication. 2009 1040 5. 2009 1040 $24,800   Lump-sum payment in installments. 2009 1040   If you choose the alternative annuity option, you usually will receive the lump-sum payment in two equal installments. 2009 1040 You will receive the first installment after you make the choice upon retirement. 2009 1040 The second installment will be paid to you, with interest, in the next calendar year. 2009 1040 (Exceptions to the installment rule are provided for cases of critical medical need. 2009 1040 )   Even though the lump-sum payment is made in installments, the overall tax treatment (explained at the beginning of this discussion) is the same as if the whole payment were paid at once. 2009 1040 If the payment has a tax-free part, you must treat the taxable part as received first. 2009 1040 How to report. 2009 1040   Add any actual or deemed payment of your lump-sum credit (defined earlier) to the total for Form 1040, line 16a; Form 1040A, line 12a; or Form 1040NR, line 17a. 2009 1040 Add the taxable part to the total for Form 1040, line 16b; Form 1040A, line 12b; or Form 1040NR, line 17b, unless you roll over the taxable part to your traditional IRA or a qualified retirement plan. 2009 1040    If you receive the lump-sum payment in two installments, include any interest paid with the second installment on line 8a of either Form 1040 or Form 1040A, or on line 9a of Form 1040NR. 2009 1040 Reduced Annuity If you have chosen to receive a lump-sum payment under the alternative annuity option, you also will receive reduced monthly annuity payments. 2009 1040 These annuity payments each will have a tax-free and a taxable part. 2009 1040 To figure the tax-free part of each annuity payment, you must use the Simplified Method (Worksheet A). 2009 1040 For instructions on how to complete the worksheet, see Worksheet A under Simplified Method, earlier. 2009 1040 To complete Worksheet A, line 2, you must reduce your cost in the plan by the tax-free part of the lump-sum payment you received. 2009 1040 Enter as your net cost on line 2 the amount from Worksheet B, line 5. 2009 1040 Do not include the tax-free part of the lump-sum payment with other amounts recovered tax free (Worksheet A, line 6) when limiting your total exclusion to your total cost. 2009 1040 Example. 2009 1040 The facts are the same as in the example for David Brown in the preceding discussion. 2009 1040 In addition, David received 10 annuity payments in 2013 of $1,200 each. 2009 1040 Using Worksheet A, he figures the taxable part of his annuity payments. 2009 1040 He completes line 2 by reducing his $31,000 cost by the $6,200 tax-free part of his lump-sum payment. 2009 1040 His entry on line 2 is his $24,800 net cost in the plan (the amount from Worksheet B, line 5). 2009 1040 He does not include the tax-free part of his lump-sum payment on Worksheet A, line 6. 2009 1040 David's filled-in Worksheet A is shown on the next page. 2009 1040 Worksheet A. 2009 1040 Simplified Method for David Brown See the instructions in Part II of this publication under Simplified Method . 2009 1040 1. 2009 1040 Enter the total pension or annuity payments received this year. 2009 1040 Also, add this amount to the total for Form 1040, line 16a; Form 1040A, line 12a; or Form 1040NR, line 17a 1. 2009 1040 $ 12,000 2. 2009 1040 Enter your cost in the plan at the annuity starting date, plus any death benefit exclusion*. 2009 1040 See Your cost in Part II, Rules for Retirees, earlier 2. 2009 1040 24,800 Note: If your annuity starting date was before this year and you completed this worksheet last year, skip line 3 and enter the amount from line 4 of last year's worksheet on line 4 below (even if the amount of your pension or annuity has changed). 2009 1040 Otherwise, go to line 3. 2009 1040   3. 2009 1040 Enter the appropriate number from Table 1 below. 2009 1040 But if your annuity starting date was after 1997 and the payments are for your life and that of your beneficiary, enter the appropriate number from Table 2 below. 2009 1040 3. 2009 1040 360 4. 2009 1040 Divide line 2 by the number on line 3 4. 2009 1040 68. 2009 1040 89 5. 2009 1040 Multiply line 4 by the number of months for which this year's payments were made. 2009 1040 If your annuity starting date was before 1987, enter this amount on line 8 below and skip lines 6, 7, 10, and 11. 2009 1040 Otherwise, go to line 6 5. 2009 1040 688. 2009 1040 90 6. 2009 1040 Enter any amounts previously recovered tax free in years after 1986. 2009 1040 This is the amount shown on line 10 of your worksheet for last year 6. 2009 1040 0 7. 2009 1040 Subtract line 6 from line 2 7. 2009 1040 24,800 8. 2009 1040 Enter the smaller of line 5 or line 7 8. 2009 1040 688. 2009 1040 90 9. 2009 1040 Taxable amount for year. 2009 1040 Subtract line 8 from line 1. 2009 1040 Enter the result, but not less than zero. 2009 1040 Also, add this amount to the total for Form 1040, line 16b, or Form 1040A, line 12b. 2009 1040 If you are a nonresident alien, also enter this amount on line 1 of Worksheet C. 2009 1040 If your Form CSA 1099R or Form CSF 1099R shows a larger amount, use the amount figured on this line instead. 2009 1040 If you are a retired public safety officer, see Distributions Used To Pay Insurance Premiums for Public Safety Officers in Part II before entering an amount on your tax return or Worksheet C, line 1 9. 2009 1040 $11,311. 2009 1040 10 10. 2009 1040 Was your annuity starting date before 1987?   Yes. 2009 1040 Do not complete the rest of this worksheet. 2009 1040    No. 2009 1040 Add lines 6 and 8. 2009 1040 This is the amount you have recovered tax free through 2013. 2009 1040 You will need this number if you need to fill out this worksheet next year 10. 2009 1040 688. 2009 1040 90 11. 2009 1040 Balance of cost to be recovered. 2009 1040 Subtract line 10 from line 2. 2009 1040 If zero, you will not have to complete this worksheet next year. 2009 1040 The payments you receive next year will generally be fully taxable 11. 2009 1040 $24,111. 2009 1040 10 Table 1 for Line 3 Above    IF your age on your annuity starting date was   AND your annuity starting date was—     before November 19, 1996,  THEN enter on line 3 after November 18, 1996,  THEN enter on line 3   55 or under 300 360   56–60 260 310   61–65 240 260   66–70 170 210   71 or over 120 160  Table 2 for Line 3 Above    IF the annuitants' combined ages on your annuity starting date were   THEN enter on line 3         110 or under   410         111–120   360         121–130   310         131–140   260         141 or over   210       * A death benefit exclusion of up to $5,000 applied to certain benefits received by survivors of employees who died before August 21, 1996. 2009 1040 Reemployment after choosing the alternative annuity option. 2009 1040 If you chose this option when you retired and then you were reemployed by the Federal Government before retiring again, your Form CSA 1099R may show only the amount of your contributions to your retirement plan during your reemployment. 2009 1040 If the amount on the form does not include all your contributions, disregard it and use your total contributions to figure the taxable part of your annuity payments. 2009 1040 Annuity starting date before November 19, 1996. 2009 1040   If your annuity starting date is before November 19, 1996, and you chose the alternative annuity option, the taxable and tax-free parts of your lump-sum payment and your annuity payments are figured using different rules. 2009 1040 Under those rules, you do not reduce your cost in the plan (Worksheet A, line 2) by the tax-free part of the lump-sum payment. 2009 1040 However, you must include that tax-free amount with other amounts previously recovered tax free (Worksheet A, line 6) when limiting your total exclusion to your total cost. 2009 1040 Federal Gift Tax If, through the exercise or nonexercise of an election or option, you provide an annuity for your beneficiary at or after your death, you have made a gift. 2009 1040 The gift may be taxable for gift tax purposes. 2009 1040 The value of the gift is equal to the value of the annuity. 2009 1040 Joint and survivor annuity. 2009 1040   If the gift is an interest in a joint and survivor annuity where only you and your spouse can receive payments before the death of the last spouse to die, the gift generally will qualify for the unlimited marital deduction. 2009 1040 This will eliminate any gift tax liability with regard to that gift. 2009 1040   If you provide survivor annuity benefits for someone other than your current spouse, such as your former spouse, the unlimited marital deduction will not apply. 2009 1040 This may result in a taxable gift. 2009 1040 More information. 2009 1040   For information about the gift tax, see Publication 950, Introduction to Estate and Gift Taxes, and Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return, and its instructions. 2009 1040 Retirement During the Past Year If you have recently retired, the following discussions covering annual leave, voluntary contributions, and community property may apply to you. 2009 1040 Annual leave. 2009 1040   A payment for accrued annual leave received on retirement is a salary payment. 2009 1040 It is taxable as wages in the tax year you receive it. 2009 1040 Voluntary contributions. 2009 1040   Voluntary contributions to the retirement fund are those made in addition to the regular contributions that were deducted from your salary. 2009 1040 They also include the regular contributions withheld from your salary after you have the years of service necessary for the maximum annuity allowed by law. 2009 1040 Voluntary contributions are not the same as employee contributions to the Thrift Savings Plan. 2009 1040 See Thrift Savings Plan , later. 2009 1040 Additional annuity benefit. 2009 1040   If you choose to receive an additional annuity benefit from your voluntary contributions, it is treated separately from the annuity benefit that comes from the regular contributions deducted from your salary. 2009 1040 This separate treatment applies for figuring the amounts to be excluded from, and included in, gross income. 2009 1040 It does not matter that you receive only one monthly check covering both benefits. 2009 1040 Each year you will receive a Form CSA 1099R that will show how much of your total annuity received in the past year was from each type of benefit. 2009 1040   Figure the taxable and tax-free parts of your additional monthly benefits from voluntary contributions using the rules that apply to regular CSRS and FERS annuities, as explained earlier. 2009 1040 Refund of voluntary contributions. 2009 1040   If you choose to receive a refund of your voluntary contributions plus accrued interest, the interest is taxable to you in the tax year it is distributed unless you roll it over to a traditional IRA or another qualified retirement plan. 2009 1040 If you do not have OPM transfer the interest to a traditional IRA or other qualified retirement plan in a direct rollover, tax will be withheld at a 20% rate. 2009 1040 See Rollover Rules , later. 2009 1040 The interest does not qualify as a lump-sum distribution eligible for capital gain treatment or the 10-year tax option. 2009 1040 It also may be subject to an additional 10% tax on early distributions if you separate from service before the calendar year in which you reach age 55. 2009 1040 For more information, see Lump-Sum Distributions and Tax on Early Distributions in Publication 575. 2009 1040 Community property laws. 2009 1040   State community property laws apply to your annuity. 2009 1040 These laws will affect your income tax only if you file a return separately from your spouse. 2009 1040   Generally, the determination of whether your annuity is separate income (taxable to you) or community income (taxable to both you and your spouse) is based on your marital status and domicile when you were working. 2009 1040 Regardless of whether you are now living in a community property state or a noncommunity property state, your current annuity may be community income if it is based on services you performed while married and domiciled in a community property state. 2009 1040   At any time, you have only one domicile even though you may have more than one home. 2009 1040 Your domicile is your fixed and permanent legal home that you intend to use for an indefinite or unlimited period, and to which, when absent, you intend to return. 2009 1040 The question of your domicile is mainly a matter of your intentions as indicated by your actions. 2009 1040   If your annuity is a mixture of community income and separate income, you must divide it between the two kinds of income. 2009 1040 The division is based on your periods of service and domicile in community and noncommunity property states while you were married. 2009 1040   For more information, see Publication 555, Community Property. 2009 1040 Reemployment After Retirement If you retired from federal service and are later rehired by the Federal Government as an employee, you can continue to receive your annuity during reemployment. 2009 1040 The employing agency usually will pay you the difference between your salary for your period of reemployment and your annuity. 2009 1040 This amount is taxable as wages. 2009 1040 Your annuity will continue to be taxed just as it was before. 2009 1040 If you are still recovering your cost, you continue to do so. 2009 1040 If you have recovered your cost, the annuity you receive while you are reemployed generally is fully taxable. 2009 1040 Nonresident Aliens The following special rules apply to nonresident alien federal employees performing services outside the United States and to nonresident alien retirees and beneficiaries. 2009 1040 A nonresident alien is an individual who is not a citizen or a resident alien of the United States. 2009 1040 Special rule for figuring your total contributions. 2009 1040   Your contributions to the retirement plan (your cost) also include the government's contributions to the plan to a certain extent. 2009 1040 You include government contributions that would not have been taxable to you at the time they were contributed if they had been paid directly to you. 2009 1040 For example, government contributions would not have been taxable to you if, at the time made, your services were performed outside the United States. 2009 1040 Thus, your cost is increased by these government contributions and the benefits that you, or your beneficiary, must include in income are reduced. 2009 1040   This method of figuring your total contributions does not apply to any contributions the government made on your behalf after you became a citizen or a resident alien of the United States. 2009 1040 Limit on taxable amount. 2009 1040   There is a limit on the taxable amount of payments received from the CSRS, the FERS, or the TSP by a nonresident alien retiree or nonresident alien beneficiary. 2009 1040 Figure this limited taxable amount by multiplying the otherwise taxable amount by a fraction. 2009 1040 The numerator of the fraction is the retiree's total U. 2009 1040 S. 2009 1040 Government basic pay, other than tax-exempt pay for services performed outside the United States. 2009 1040 The denominator is the retiree's total U. 2009 1040 S. 2009 1040 Government basic pay for all services. 2009 1040    Basic pay includes regular pay plus any standby differential. 2009 1040 It does not include bonuses, overtime pay, certain retroactive pay, uniform or other allowances, or lump-sum leave payments. 2009 1040   To figure the limited taxable amount of your CSRS or FERS annuity or your TSP distributions, use Worksheet C. 2009 1040 (For an annuity, first complete Worksheet A in this publication. 2009 1040 ) Worksheet C. 2009 1040 Limited Taxable Amount for Nonresident Alien 1. 2009 1040 Enter the otherwise taxable amount of the CSRS or FERS annuity (from line 9 of Worksheet A or from Forms CSA 1099R or CSF 1099R) or TSP distributions (from Form 1099R) 1. 2009 1040   2. 2009 1040 Enter the total U. 2009 1040 S. 2009 1040 Government basic pay other than tax-exempt pay for services performed outside the United States 2. 2009 1040   3. 2009 1040 Enter the total U. 2009 1040 S. 2009 1040 Government basic pay for all services 3. 2009 1040   4. 2009 1040 Divide line 2 by line 3 4. 2009 1040   5. 2009 1040 Limited taxable amount. 2009 1040 Multiply line 1 by line 4. 2009 1040 Enter this amount on Form 1040NR, line 17b 5. 2009 1040   Example 1. 2009 1040 You are a nonresident alien who performed all services for the U. 2009 1040 S. 2009 1040 Government abroad as a nonresident alien. 2009 1040 You retired and began to receive a monthly annuity of $200. 2009 1040 Your total basic pay for all services for the U. 2009 1040 S. 2009 1040 Government was $100,000. 2009 1040 All of your basic pay was tax exempt because it was not U. 2009 1040 S. 2009 1040 source income. 2009 1040 The taxable amount of your annuity using Worksheet A in this publication is $720. 2009 1040 You are a nonresident alien, so you figure the limited taxable amount of your annuity using Worksheet C as follows. 2009 1040 Worksheet C. 2009 1040 Limited Taxable Amount for Nonresident Alien — Example 1 1. 2009 1040 Enter the otherwise taxable amount of the CSRS or FERS annuity (from line 9 of Worksheet A or from Forms CSA 1099R or CSF 1099R) or TSP distributions (from Form 1099R) 1. 2009 1040 $ 720 2. 2009 1040 Enter the total U. 2009 1040 S. 2009 1040 Government basic pay other than tax-exempt pay for services performed outside the United States 2. 2009 1040 0 3. 2009 1040 Enter the total U. 2009 1040 S. 2009 1040 Government basic pay for all services 3. 2009 1040 100,000 4. 2009 1040 Divide line 2 by line 3 4. 2009 1040 0 5. 2009 1040 Limited taxable amount. 2009 1040 Multiply line 1 by line 4. 2009 1040 Enter this amount on Form 1040NR, line 17b 5. 2009 1040 0 Example 2. 2009 1040 You are a nonresident alien who performed services for the U. 2009 1040 S. 2009 1040 Government as a nonresident alien both within the United States and abroad. 2009 1040 You retired and began to receive a monthly annuity of $240. 2009 1040 Your total basic pay for your services for the U. 2009 1040 S. 2009 1040 Government was $120,000; $40,000 was for work done in the United States and $80,000 was for your work done in a foreign country. 2009 1040 The part of your total basic pay for your work done in a foreign country was tax exempt because it was not U. 2009 1040 S. 2009 1040 source income. 2009 1040 The taxable amount of your annuity figured using Worksheet A in this publication is $1,980. 2009 1040 You are a nonresident alien, so you figure the limited taxable amount of your annuity using Worksheet C as follows. 2009 1040 Worksheet C. 2009 1040 Limited Taxable Amount for Nonresident Alien — Example 2 1. 2009 1040 Enter the otherwise taxable amount of the CSRS or FERS annuity (from line 9 of Worksheet A or from Forms CSA 1099R or CSF 1099R) or TSP distributions (from Form 1099R) 1. 2009 1040 $ 1,980 2. 2009 1040 Enter the total U. 2009 1040 S. 2009 1040 Government basic pay other than tax-exempt pay for services performed outside the United States 2. 2009 1040 40,000 3. 2009 1040 Enter the total U. 2009 1040 S. 2009 1040 Government basic pay for all services 3. 2009 1040 120,000 4. 2009 1040 Divide line 2 by line 3 4. 2009 1040 . 2009 1040 333 5. 2009 1040 Limited taxable amount. 2009 1040 Multiply line 1 by line 4. 2009 1040 Enter this amount on Form 1040NR, line 17b 5. 2009 1040 659 Thrift Savings Plan Generally, all of the money in your TSP account is taxed as ordinary income when you receive it. 2009 1040 (However, see Roth TSP balance and Uniformed services TSP accounts, next. 2009 1040 ) This is because neither the contributions to your traditional TSP balance nor its earnings have been included previously in your taxable income. 2009 1040 The way that you withdraw your account balance determines when you must pay the tax. 2009 1040 Roth TSP balance. 2009 1040   The TSP also offers a Roth TSP option, which allows you to make after-tax contributions into your TSP account. 2009 1040 This means Roth TSP contributions are included in your income. 2009 1040 The contribution limits are the same as the traditional TSP. 2009 1040 You can elect to have part or all of your TSP contributions designated as a Roth TSP. 2009 1040 Agency contributions will be part of your traditional TSP balance. 2009 1040 Also, you cannot roll over any portion of your traditional TSP into your Roth TSP. 2009 1040   Qualified distributions from your Roth TSP are not included in income. 2009 1040 This applies to both your cost in the account and income earned on that account. 2009 1040 A qualified distribution is generally a distribution that is: Made after a 5-tax-year period of participation, and Made on or after the date you reach age 59½, made to a beneficiary or your estate on or after your death, or attributable to your being disabled. 2009 1040   For more information, go to the TSP website, www. 2009 1040 tsp. 2009 1040 gov, or the TSP Service Office. 2009 1040 See Publication 575, Pension and Annuity Income, for more information about designated Roth accounts. 2009 1040 Uniformed services TSP accounts. 2009 1040   If you have a uniformed services TSP account that includes contributions from combat zone pay, the distributions attributable to those contributions are tax exempt. 2009 1040 However, any earnings on those contributions to a traditional TSP balance are subject to tax when they are distributed. 2009 1040 See Roth TSP balance discussed previously to get more information about Roth contributions. 2009 1040 The statement you receive from the TSP will separately state the total amount of your distribution and the amount of your taxable distribution for the year. 2009 1040 You can get more information from the TSP website, www. 2009 1040 tsp. 2009 1040 gov, or the TSP Service Office. 2009 1040 Direct rollover by the TSP. 2009 1040   If you ask the TSP to transfer any part of the money in your account, from traditional contributions and its earnings, to a traditional IRA or other qualified retirement plan, the tax on that part is deferred until you receive payments from the traditional IRA or other plan. 2009 1040 However, see the following Note for a discussion on direct rollovers by the TSP of Roth contributions and its earnings. 2009 1040 Also, see Rollover Rules , later. 2009 1040 Direct rollover by the TSP to a Roth IRA. 2009 1040   If you ask the TSP to transfer any part of the money in your account, from traditional contributions and its earnings, to a Roth IRA, the amount transferred will be taxed in the current year. 2009 1040 However, see the following Note for a discussion on direct rollovers by the TSP of Roth contributions and its earnings. 2009 1040 Also, see Rollovers to Roth IRAs for more information, later. 2009 1040 Note. 2009 1040 A direct rollover of your Roth contributions and its earnings (if certain conditions are met, see Roth TSP balance , earlier) in your TSP account to a Roth 401(k), Roth 403(b), Roth 457(b), or Roth IRA are not subject to tax when they are transferred or when you receive payments from those accounts at a later date. 2009 1040 This is because you already paid tax on those contributions. 2009 1040 You cannot rollover Roth contributions and its earnings in your TSP account to a traditional IRA. 2009 1040 TSP annuity. 2009 1040   If you ask the TSP to buy an annuity with the money in your account, from traditional contributions and its earnings, the annuity payments are taxed when you receive them. 2009 1040 The payments are not subject to the additional 10% tax on early distributions, even if you are under age 55 when they begin. 2009 1040 However, there is no tax on the annuity payments if the annuity is purchased using the money in your account from Roth contributions and its earnings if certain conditions are met. 2009 1040 See Roth TSP balance , earlier. 2009 1040 This is because you already paid tax on those contributions. 2009 1040 Cash withdrawals. 2009 1040   If you withdraw any of the money in your TSP account, from traditional contributions and its earnings, it is generally taxed as ordinary income when you receive it unless you roll it over into a traditional IRA or other qualified plan. 2009 1040 (See Rollover Rules , later. 2009 1040 ) If you receive your entire TSP account balance in a single tax year, you may be able to use the 10-year tax option to figure your tax. 2009 1040 See Lump-Sum Distributions in Publication 575 for details. 2009 1040 However, there is no tax if you withdraw money in your TSP account from Roth contributions and its earnings if certain conditions are met. 2009 1040 See Roth TSP balance , earlier. 2009 1040    To qualify for the 10-year tax option, the plan participant must have been born before January 2, 1936. 2009 1040   If you receive a single payment or you choose to receive your account balance in monthly payments over a period of less than 10 years, the TSP generally must withhold 20% for federal income tax. 2009 1040 If you choose to receive your account balance in monthly payments over a period of 10 or more years or a period based on your life expectancy, the payments are subject to withholding as if you are married with three withholding allowances, unless you submit a withholding certificate. 2009 1040 See also Withholding from Thrift Savings Plan payments earlier under Tax Withholding and Estimated Tax in Part I. 2009 1040 However, there is no withholding requirement for amounts withdrawn from your TSP account that is from Roth contributions and its earnings, if certain conditions are met. 2009 1040 See Roth TSP balance , earlier, for a discussion of those conditions. 2009 1040 Tax on early distributions. 2009 1040   Any money paid to you from your TSP account before you reach age 59½ may be subject to an additional 10% tax on early distributions. 2009 1040 However, this additional tax does not apply in certain situations, including any of the following. 2009 1040 You receive the distribution and separate from government service during or after the calendar year in which you reach age 55. 2009 1040 You choose to receive your account balance in monthly payments based on your life expectancy. 2009 1040 You are totally and permanently disabled. 2009 1040 You receive amounts from your Roth contributions since that represents a return of your cost (after-tax money). 2009 1040 The earnings may be subject to the 10% tax depending on whether you met certain conditions. 2009 1040 See Roth TSP balance , earlier. 2009 1040   For more information, see Tax on Early Distributions in Publication 575. 2009 1040 Outstanding loan. 2009 1040   If the TSP declares a distribution from your account because money you borrowed has not been repaid when you separate from government service, your account is reduced and the amount of the distribution (your unpaid loan balance and any unpaid interest), from traditional contributions and its earnings, is taxed in the year declared. 2009 1040 The distribution also may be subject to the additional 10% tax on early distributions. 2009 1040 However, the tax will be deferred if you make a rollover contribution to a traditional IRA or other qualified plan equal to the declared distribution amount. 2009 1040 See Rollover Rules , later. 2009 1040   If you withdraw any money from your TSP account in that same year, the TSP must withhold income tax of 20% of the total of the declared distribution and the amount withdrawn. 2009 1040 However, no withholding is required for portions of the distribution that is from Roth contributions and its earnings, if certain conditions are met. 2009 1040 See Roth TSP balance , earlier. 2009 1040 More information. 2009 1040   For more information about the TSP, see Summary of the Thrift Savings Plan, distributed to all federal employees. 2009 1040 Also, see Important Tax Information About Payments From Your TSP Account and Special Tax Withholding Rules for Thrift Savings Plan Payments to Nonresident Aliens, which are available from your agency personnel office or from the TSP by calling 1-TSP-YOU-FIRST (1-877-968-3778) and for participants who are deaf, hard of hearing, or have a speech disability, call 1-TSP-THRIFT5 (1-877-847-4385). 2009 1040    The above documents are also available on the TSP website at www. 2009 1040 tsp. 2009 1040 gov. 2009 1040 Select “Forms & Publications. 2009 1040 ” Rollover Rules Generally, a rollover is a tax-free withdrawal of cash or other assets from one qualified retirement plan or traditional IRA and its reinvestment in another qualified retirement plan or traditional IRA. 2009 1040 You do not include the amount rolled over in your income, and you cannot take a deduction for it. 2009 1040 The amount rolled over is taxed later as the new program pays that amount to you. 2009 1040 If you roll over amounts into a traditional IRA, later distributions of these amounts from the traditional IRA do not qualify for the capital gain or the 10-year tax option. 2009 1040 However, capital gain treatment or the 10-year tax option will be restored if the traditional IRA contains only amounts rolled over from a qualified plan and these amounts are rolled over from the traditional IRA into a qualified retirement plan. 2009 1040 To qualify for the capital gain treatment or 10-year tax option, the plan participant must have been born before January 2, 1936. 2009 1040 You can also roll over a distribution from a qualified retirement plan into a Roth IRA. 2009 1040 Although the transfer of a distribution into a Roth IRA is considered a rollover for Roth IRA purposes, it is not a tax-free transfer unless you are rolling over amounts from Roth contributions and its earnings. 2009 1040 See Rollovers to Roth IRAs , later, for more information. 2009 1040 Qualified retirement plan. 2009 1040   For this purpose, a qualified retirement plan generally is: A qualified employee plan, A qualified employee annuity, A tax-sheltered annuity plan (403(b) plan), or An eligible state or local government section 457 deferred compensation plan. 2009 1040 The CSRS, FERS, and TSP are considered qualified retirement plans. 2009 1040 Distributions eligible for rollover treatment. 2009 1040   If you receive a refund of your CSRS or FERS contributions when you leave government service, you can roll over any interest you receive on the contributions. 2009 1040 You cannot roll over any part of your CSRS or FERS annuity payments. 2009 1040   You can roll over a distribution of any part of your TSP account balance except: A distribution of your account balance that you choose to receive in monthly payments over: Your life expectancy, The joint life expectancies of you and your beneficiary, or A period of 10 years or more, A required minimum distribution generally beginning at age 70½, A declared distribution because of an unrepaid loan, if you have not separated from government service (see Outstanding loan under Thrift Savings Plan, earlier), or A hardship distribution. 2009 1040   In addition, a distribution to your beneficiary generally is not treated as an eligible rollover distribution. 2009 1040 However, see Qualified domestic relations order (QDRO) and Rollovers by surviving spouse , and Rollovers by nonspouse beneficiary , later. 2009 1040 Direct rollover option. 2009 1040   You can choose to have the OPM or TSP transfer any part of an eligible rollover distribution directly to another qualified retirement plan that accepts rollover distributions or to a traditional IRA or Roth IRA. 2009 1040   There is an automatic rollover requirement for mandatory distributions. 2009 1040 A mandatory distribution is a distribution made without your consent and before you reach age 62 or normal retirement age, whichever is later. 2009 1040 The automatic rollover requirement applies if the distribution is more than $1,000 and is an eligible rollover distribution. 2009 1040 You can choose to have the distribution paid directly to you or rolled over directly to your traditional or Roth IRA or another qualified retirement plan. 2009 1040 If you do not make this choice, OPM will automatically roll over the distribution into an IRA of a designated trustee or issuer. 2009 1040 No tax withheld. 2009 1040   If you choose the direct rollover option or have an automatic rollover, no tax will be withheld from any part of the distribution that is directly paid to the trustee of the other plan. 2009 1040 However, if the rollover is to a Roth IRA, you may want to choose to have tax withheld since any amount rolled over is generally included in income. 2009 1040 Any part of the eligible rollover distribution paid to you is subject to withholding at a 20% rate. 2009 1040 Direct roll over amounts from Roth contributions and its earnings do not have tax withheld because you already paid tax on those amounts. 2009 1040 Payment to you option. 2009 1040   If an eligible rollover distribution is paid to you, the OPM or TSP must withhold 20% for income tax even if you plan to roll over the distribution to another qualified retirement plan, traditional or Roth IRA. 2009 1040 However, the full amount is treated as distributed to you even though you actually receive only 80%. 2009 1040 You generally must include in income any part (including the part withheld) that you do not roll over within 60 days to another qualified retirement plan or to a traditional IRA. 2009 1040 Rollovers to Roth IRAs are generally included in income. 2009 1040 Eligible rollover distributions that are from Roth contributions do not have tax withheld because you already paid tax on those amounts. 2009 1040 If you leave government service before the calendar year in which you reach age 55 and are under age 59½ when a distribution is paid to you, you may have to pay an additional 10% tax on any part, including any tax withheld, that you do not roll over. 2009 1040 However, distributions from Roth contributions will not be subject to the 10% additional tax because it is a return of your cost (after-tax money). 2009 1040 Earnings from those contributions may be subject to the 10% additional tax if certain conditions are not met. 2009 1040 See Roth TSP balance , earlier. 2009 1040 Also, see Tax on Early Distributions in Publication 575. 2009 1040 Exception to withholding. 2009 1040   Withholding from an eligible rollover distribution paid to you is not required if the distributions for your tax year total less than $200. 2009 1040 Partial rollovers. 2009 1040   A lump-sum distribution may qualify for capital gain treatment or the 10-year tax option if the plan participant was born before January 2, 1936. 2009 1040 See Lump-Sum Distributions in Publication 575. 2009 1040 However, if you roll over any part of the distribution, the part you keep does not qualify for this special tax treatment. 2009 1040 Rolling over more than amount received. 2009 1040   If you want to roll over more of an eligible rollover distribution than the amount you received after income tax was withheld, you will have to add funds from some other source (such as your savings or borrowed amounts). 2009 1040 Example. 2009 1040 You left government service at age 53. 2009 1040 On February 1, 2013, you receive an eligible rollover distribution of $10,000 from you
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What Can You Expect from Appeals?

If your case qualifies for an appeal, an Appeals employee will review the issues of your case with a fresh, objective perspective and schedule a conference with you. Appeals conferences are informal and conducted by correspondence, telephone or in person. Most differences are settled in these appeals without expensive and time-consuming court trials. Appeals will consider any reason you have for disagreement, except for moral, religious, political, constitutional, conscientious objection, or similar grounds.

Our Commitments


  • Explain your appeal rights and the Appeals process
  • Listen to your concerns, be courteous and professional
  • Be timely and responsive
  • Be fair and impartial

Your Responsibilities


  • In your protest requesting an appeal, list all issues with which you disagree and why, and tell us how you understand the facts and the law.
  • Listen to our explanation of your appeal rights and the Appeals process, including the timeframe to resolve your case.
  • Give us any additional information or documentation that will be helpful to your case within the timeframe specified. If you present new information that you did not provide to the auditor or revenue officer, we may refer that information for further consideration. You will receive their comments, and have an opportunity to respond.
  • Let us know the best time to contact you.

General Timeframe

First Notice from Appeals

Response times from Appeals can vary, depending on the type of case and the time needed to review the file. Normally, you can expect to hear from an Appeals employee within 90 days after you file your request. If it has been more than 90 days since you filed your request, you should contact the office where you sent your appeal request. They can tell you when they forwarded your case to Appeals. Please allow 90 days from when your file was sent to Appeals for a reply. If the IRS office to which you sent your request cannot provide a reason for the delay you have two options: (1) have that office contact Appeals for an approximate date when Appeals might contact you, (2) call the Appeals Account Resolution Specialist (AARS) at 559-233-1267. The AARS can tell you if your case has been assigned to an Appeals employee and how to contact that employee directly.

Timeframe for Resolving Your Case

The time it takes to resolve your case depends on the facts and circumstances. It could take anywhere from 90 days to a year. Please contact your Appeals Officer or Settlement Officer for a more specific timeframe.

Page Last Reviewed or Updated: 16-Jan-2014

The 2009 1040

2009 1040 2. 2009 1040   Fuel Tax Credits and Refunds Table of Contents Gasoline and Aviation Gasoline Undyed Diesel Fuel and Undyed Kerosene (Other Than Kerosene Used in Aviation)Sales by Registered Ultimate Vendors Diesel-Water Fuel Emulsion Kerosene for Use in AviationSales by Registered Ultimate Vendors Other Fuels (Including Alternative Fuels) Refunds of Second TaxOptional reporting. 2009 1040 Providing information. 2009 1040 Definitions of Nontaxable UsesCustom application of fertilizer and pesticide. 2009 1040 Fuel used between airfield and farm. 2009 1040 Fuel not used for farming. 2009 1040 Vehicles not considered highway vehicles. 2009 1040 Biodiesel or Renewable Diesel Mixture Credit, Alternative Fuel Credit, and Alternative Fuel Mixture CreditHow to Claim the Credit Filing Claims Claiming A Refund Claiming a Credit on Form 4136 Including the Credit or Refund in Income Federal excise taxes are imposed on certain fuels as discussed in chapter 1. 2009 1040 This chapter lists the nontaxable uses of each fuel and defines the nontaxable uses. 2009 1040 Information on the refund of second tax is included. 2009 1040 This chapter also explains credits and refunds for the biodiesel or renewable diesel mixture credits, and the alternative fuel mixture and alternative fuel credits. 2009 1040 Information on how to make a claim for credit or refund is included in this chapter and in the instructions for: Form 720, Form 4136, and Form 8849. 2009 1040 Exported taxable fuel. 2009 1040   The claim rates for exported taxable fuel are listed on Schedule C (Form 720), Schedule 1 (Form 8849), and Form 4136. 2009 1040 Taxpayers making a claim for exported taxable fuel must include with their records proof of exportation. 2009 1040 Proof of exportation includes: A copy of the export bill of lading issued by the delivering carrier, A certificate by the agent or representative of the export carrier showing actual exportation of the fuel, A certificate of lading signed by a customs officer of the foreign country to which the fuel is exported, or A statement of the foreign consignee showing receipt of the fuel. 2009 1040 Gasoline and Aviation Gasoline Ultimate Purchasers. 2009 1040   The following are the uses of gasoline (defined earlier) for which a credit or refund may be allowable to an ultimate purchaser. 2009 1040 On a farm for farming purposes (credit only). 2009 1040 Off-highway business use. 2009 1040 Export. 2009 1040 In a boat engaged in commercial fishing. 2009 1040 In certain intercity and local buses. 2009 1040 In a school bus. 2009 1040 Exclusive use by a qualified blood collector organization. 2009 1040 In a highway vehicle owned by the United States that is not used on a highway. 2009 1040 Exclusive use by a nonprofit educational organization (see Sales by registered ultimate vendors and Credit Card Purchases, later). 2009 1040 Exclusive use by a state, political subdivision of a state, or the District of Columbia (see Sales by registered ultimate vendors and Credit Card Purchases, later). 2009 1040 In an aircraft or vehicle owned by an aircraft museum. 2009 1040   The following are the uses of aviation gasoline for which a credit or refund may be allowable to an ultimate purchaser. 2009 1040 On a farm for farming purposes (credit only). 2009 1040 Export. 2009 1040 In foreign trade. 2009 1040 Certain helicopter and fixed-wing air ambulance uses. 2009 1040 In commercial aviation (other than foreign trade). 2009 1040 Exclusive use by a qualified blood collector organization. 2009 1040 Exclusive use by a nonprofit education organization (see Sales by registered ultimate vendors and Credit card purchases, later). 2009 1040 Exclusive use by a state, political subdivision of a state, or the District of Columbia (see Sales by registered ultimate vendors and Credit and purchases, later). 2009 1040 In an aircraft owned by an aircraft museum. 2009 1040 In military aircraft. 2009 1040 Claims by persons who paid the tax to the government. 2009 1040   Except for sales to nonprofit educational organizations and states and local governments, a credit or refund is allowable to the person that paid the tax to the government if the gasoline was sold to the ultimate purchaser (including an exporter) by either that person or by a retailer and the fuel was exported; used or sold for use as supplies for vessels or aircraft, including military aircraft, commercial fishing, and foreign trade; sold to a qualified blood collector organization; or used or sold for use in the production of Other Fuels. 2009 1040 See Filing Claims, later. 2009 1040 Sales by registered ultimate vendors. 2009 1040   This is an ultimate vendor that sells gasoline or aviation gasoline to any of the following and that is purchased without the use of a credit card. 2009 1040 A state or local government for its exclusive use (including essential government use by an Indian tribal government). 2009 1040 A nonprofit educational organization for its exclusive use. 2009 1040   The registered ultimate vendor may make the claim if the ultimate purchaser did not use a credit card and waives its right to the credit or refund by providing the registered ultimate vendor with a certificate. 2009 1040 A sample certificate is included as Model Certificate M in the Appendix. 2009 1040 The registered ultimate vendor must have the certificate at the time the credit or refund is claimed. 2009 1040   The ultimate vendor must be registered by the IRS. 2009 1040 See Registration Requirements, earlier. 2009 1040 Credit card purchases. 2009 1040   If gasoline and aviation gasoline are purchased with a credit card issued to a state or local government for its exclusive use (including essential government use by an Indian tribal government), or a nonprofit educational organization for its exclusive use, the person who extended credit to the ultimate purchaser (the credit card issuer) is treated as the person that paid the tax and makes the claim if the credit card issuer: Is registered by the IRS, Has established that the amount of tax has not been collected from the person who purchased the gasoline or has obtained written consent from the ultimate purchaser to the allowance of the credit or refund, and Has repaid or agreed to repay the amount of the tax to the ultimate vendor, has obtained the written consent of the ultimate vendor to the allowance of the credit or refund, or has made arrangements that provide the ultimate vendor with reimbursement of the tax. 2009 1040   If the requirements above are not met by the credit card issuer, the credit card issuer must collect the tax from the ultimate purchaser and only the ultimate purchaser may make the claim. 2009 1040 How to make the claim. 2009 1040   If the claim is made by the credit card issuer, see Schedule C  (Form 720) or Schedule 8 (Form 8849). 2009 1040 Undyed Diesel Fuel and Undyed Kerosene (Other Than Kerosene Used in Aviation) For conditions to an allowance of a credit or refund on exported dyed diesel fuel and dyed kerosene, see Exported taxable fuel, earlier. 2009 1040 Ultimate purchasers. 2009 1040   The following are nontaxable uses of diesel fuel and kerosene (defined earlier) for which a credit or refund may be allowable to an ultimate purchaser. 2009 1040 On a farm for farming purposes. 2009 1040 Off-highway business use. 2009 1040 Export. 2009 1040 In a qualified local bus. 2009 1040 In a school bus. 2009 1040 Other than as a fuel in a propulsion engine of a diesel-powered highway vehicle (such as home heating oil). 2009 1040 Exclusive use by a qualified blood collector organization. 2009 1040 In a highway vehicle owned by the United States that is not used on a highway. 2009 1040 Exclusive use by a nonprofit educational organization (see Sales by Registered Ultimate Vendors and Credit Card Purchases, later). 2009 1040 Exclusive use by a state, political subdivision of a state, or the District of Columbia (see Sales by Registered Ultimate Vendors and Credit Card Purchases, later). 2009 1040 In a vehicle owned by an aircraft museum. 2009 1040 As a fuel in a propulsion engine of a diesel-powered train. 2009 1040 Sales by Registered Ultimate Vendors The following are the sales for which a credit or refund may be allowable to the registered ultimate vendor only. 2009 1040 Undyed diesel fuel or undyed kerosene sold for the exclusive use by a state or local government (if credit card rules (defined later) do not apply), Undyed kerosene sold from a blocked pump (defined below), or Undyed diesel fuel or undyed kerosene used in certain intercity and local buses, only if the ultimate purchaser waives its right to the credit or refund by providing the registered ultimate vendor with a waiver. 2009 1040 Registered ultimate vendor (state use). 2009 1040   This is a person that sells undyed diesel fuel or undyed kerosene to a state or local government for its exclusive use (including essential government use by an Indian tribal government). 2009 1040 The diesel fuel or kerosene must be purchased by the state without the use of a credit card, issued to the state by the credit card issuer, in order for the ultimate vendor to make the claim. 2009 1040 The ultimate vendor must be registered by the IRS. 2009 1040 See Registration Requirements, earlier. 2009 1040 Registered ultimate vendor (blocked pump). 2009 1040   This is an ultimate vendor that sells undyed kerosene from a blocked pump. 2009 1040   A credit or refund may be allowable to a registered ultimate vendor (blocked pump) if the vendor sold to a buyer undyed kerosene from a blocked pump for use other than as a fuel in a diesel-powered highway vehicle and the vendor had no reason to believe the kerosene would not be used in that manner. 2009 1040 Blocked pump. 2009 1040   A blocked pump is a fuel pump that meets all the following requirements. 2009 1040 It is used to make retail sales of undyed kerosene for use by the buyer in any nontaxable use. 2009 1040 It is at a fixed location. 2009 1040 It is identified with a legible and conspicuous notice stating, “UNDYED UNTAXED KEROSENE, NONTAXABLE USE ONLY. 2009 1040 ” It meets either of the following conditions. 2009 1040 It cannot reasonably be used to dispense fuel directly into the fuel supply tank of a diesel-powered highway vehicle or train. 2009 1040 It is locked by the vendor after each sale and unlocked by the vendor only in response to a buyer's request for undyed kerosene for use other than as a fuel in a diesel-powered highway vehicle or train. 2009 1040 Registered ultimate vendor (certain intercity and local buses). 2009 1040   This is an ultimate vendor that sells undyed diesel fuel or undyed kerosene to the ultimate purchaser for use in certain intercity and local buses. 2009 1040   The registered ultimate vendor may make the claim if the ultimate purchaser waives its right to the credit or refund by providing the registered ultimate vendor with a waiver. 2009 1040 A sample waiver is included as Model Waiver N in the Appendix. 2009 1040 The registered ultimate vendor must have the waiver at the time the credit or payment is claimed. 2009 1040 Credit Card Purchases. 2009 1040   If undyed diesel fuel or kerosene is purchased with a credit card issued to a state, the person who extended credit to the state (the credit card issuer) is treated as the person that paid the tax and makes the claim if the credit card issuer: Is registered by the IRS, Has established that the amount of tax has not been collected from the person who purchased the diesel fuel or kerosene, or has obtained written consent from the ultimate purchaser to the allowance of the credit or refund, and Has repaid or agreed to repay the amount of the tax to the ultimate vendor, has obtained the written consent of the ultimate vendor to the allowance of the credit or refund, or has made arrangements that provide the ultimate vendor with reimbursement of the tax. 2009 1040   If the requirements above are not met by the credit card issuer, the credit card issuer must collect the tax from the ultimate purchaser and only the ultimate purchaser may make the claim. 2009 1040 Diesel-Water Fuel Emulsion A claim for credit or refund may be made for the nontaxable use of a diesel-water fuel emulsion and for undyed diesel fuel used to produce a diesel-water fuel emulsion. 2009 1040 The claim rate for nontaxable use of a diesel-water fuel emulsion taxed at $. 2009 1040 198 per gallon is $. 2009 1040 197 (if exported, the claim rate is $. 2009 1040 198). 2009 1040 The following are the nontaxable uses for a diesel-water fuel emulsion for which a credit or refund may be allowable to an ultimate purchaser. 2009 1040 On a farm for farming purposes. 2009 1040 Off-highway business use. 2009 1040 Export. 2009 1040 In a qualified local bus. 2009 1040 In a school bus. 2009 1040 Other than as fuel in the propulsion engine of a train or diesel-powered highway vehicle (but not off-highway use). 2009 1040 Exclusive use by a qualified blood collector organization. 2009 1040 In a highway vehicle owned by the United States that is not used on a highway. 2009 1040 Exclusive use by a nonprofit educational organization. 2009 1040 Exclusive use by a state, political subdivision of a state, or the District of Columbia. 2009 1040 In an aircraft or vehicle owned by an aircraft museum. 2009 1040 Blender claims. 2009 1040   The claim rate for undyed diesel fuel taxed at $. 2009 1040 244 and used to produce a diesel-water fuel emulsion is $. 2009 1040 046 per gallon of diesel fuel so used. 2009 1040 The blender must be registered by the IRS in order to make the claim. 2009 1040 The blender must attach a statement to the claim certifying that: The diesel-water fuel emulsion contains at least 14% water, The emulsion additive is registered by a United States manufacturer with the EPA under section 211 of the Clean Air Act as in effect on March 31, 2003, Undyed diesel fuel taxed at $. 2009 1040 244 was used to produce the diesel-water fuel emulsion, and The diesel-water fuel emulsion was used or sold for use in the blender's trade or business. 2009 1040 Kerosene for Use in Aviation Ultimate purchasers. 2009 1040   Ultimate purchasers of kerosene used in certain aviation uses may make a claim if the rate of tax on their use is less than the rate of tax that was charged on the kerosene. 2009 1040   The ultimate purchaser of the kerosene used in commercial aviation (other than foreign trade) and noncommercial aviation (other than nonexempt, noncommercial aviation and exclusive use by a state, political subdivision of a state, or the District of Columbia) is eligible to make a claim if the ultimate purchaser certifies that the right to make the claim has not been waived. 2009 1040 Generally, the ultimate purchaser is the aircraft operator. 2009 1040   The following are the nontaxable uses of kerosene used in noncommercial aviation for which a credit or refund may be allowable to the ultimate purchaser. 2009 1040 On a farm for farming purposes. 2009 1040 Certain helicopter and fixed-wing aircraft uses. 2009 1040 Exclusive use by a qualified blood collector organization. 2009 1040 Exclusive use by a nonprofit educational organization. 2009 1040 In an aircraft owned by an aircraft museum. 2009 1040 In military aircraft. 2009 1040 Kerosene for use partly in commercial aviation and partly in nonexempt, noncommercial aviation. 2009 1040   If the fuel is used partly for use in commercial aviation and partly for use in nonexempt, noncommercial aviation, the operator may identify, either at the time of purchase or after the kerosene has been used, the amount that will be (or has been) used in commercial aviation. 2009 1040 At the same time, the operator would either make the claim or waive the right to make the claim for credit or refund of the kerosene for use in commercial and nonexempt, noncommercial aviation. 2009 1040   If the operator does not identify the amount of kerosene that will be (or has been) used in commercial aviation, the operator may provide a certificate to the ultimate vendor similar to Model Certificate Q in the Appendix. 2009 1040 For kerosene purchased with the certificate, used in commercial aviation, and taxed at $. 2009 1040 244 per gallon, use of the certificate will be treated as a waiver of the right to claim a credit or refund for the $. 2009 1040 025 per gallon part of the tax. 2009 1040 The ultimate vendor may make this claim. 2009 1040 The operator may make a claim for the $. 2009 1040 175 tax per gallon of the kerosene, but cannot waive the right to make the claim for the $. 2009 1040 175 tax per gallon. 2009 1040 Sales by Registered Ultimate Vendors Kerosene for use in commercial aviation or noncommercial aviation. 2009 1040   The registered ultimate vendor of kerosene for use in commercial aviation (other than foreign trade) or noncommercial aviation (other than nonexempt, noncommercial aviation and exclusive use by a state, political subdivision of a state, or the District of Columbia) may make this claim if the ultimate purchaser waives its right to the credit or payment by providing the registered ultimate vendor with a waiver. 2009 1040 A sample waiver is included as Model Waiver L in the Appendix. 2009 1040 The registered ultimate vendor must have the waiver at the time the credit or payment is claimed. 2009 1040   Noncommercial aviation means any use of an aircraft not described as commercial aviation. 2009 1040 For the definition of commercial aviation, see Commercial aviation on page 11. 2009 1040 Kerosene for use in nonexempt, noncommercial aviation. 2009 1040   Only the registered ultimate vendor may claim a credit or payment for sales of kerosene for use in nonexempt, noncommercial aviation. 2009 1040 The ultimate vendor must be registered by the IRS (activity letter UA) and have the required certificate from the ultimate purchaser. 2009 1040 A sample certificate is included as Model Certificate Q in the Appendix. 2009 1040 The registered ultimate vendor must have the certificate at the time the credit or payment is claimed. 2009 1040 Kerosene for use in aviation by a state or local government. 2009 1040   Only the registered ultimate vendor may claim a credit or payment for sales of kerosene for use in aviation to a state or local government for its exclusive use (including essential government use by an Indian tribal government). 2009 1040 The kerosene for use in aviation must be purchased by the state without the use of a credit card in order for the ultimate vendor to make the claim. 2009 1040 The ultimate vendor must be registered by the IRS (activity letter UV) and have the required certificate from the ultimate purchaser. 2009 1040 A sample certificate is included as Model Certificate P in the Appendix. 2009 1040 The registered ultimate vendor must have the certificate at the time the credit or payment is claimed. 2009 1040 Credit card purchases. 2009 1040   If taxed kerosene for use in aviation is purchased with a credit card issued to a state, the person who extended credit to the state (the credit card issuer) is treated as the person that paid the tax and makes the claim if the credit card issuer: Is registered by the IRS, Has established that the amount of tax has not been collected from the person who purchased the kerosene, or has obtained written consent from the ultimate purchaser to the allowance of the credit or refund, and Has repaid or agreed to repay the amount of the tax to the ultimate vendor, has obtained the written consent of the ultimate vendor to the allowance of the credit or refund, or has made arrangements that provide the ultimate vendor with reimbursement of the tax. 2009 1040   If the requirements above are not met by the credit card issuer, the credit card issuer must collect the tax from the ultimate purchaser and only the ultimate purchaser may make the claim. 2009 1040 Other Fuels (Including Alternative Fuels) Credit or refund for nontaxable use of taxed Other Fuels may be allowable to an ultimate purchaser. 2009 1040 While tax is generally imposed on delivery, Other Fuels are taxed prior to delivery in the case of certain bulk sales described in chapter 1. 2009 1040 The following are the nontaxable uses of Other Fuels for which a credit or refund may be allowable to the ultimate purchaser. 2009 1040 On a farm for farming purposes. 2009 1040 Off-highway business use. 2009 1040 In a boat engaged in commercial fishing. 2009 1040 In certain intercity and local buses. 2009 1040 In a school bus. 2009 1040 In a qualified local bus. 2009 1040 Exclusive use by a qualified blood collector organization. 2009 1040 Exclusive use by a nonprofit educational organization. 2009 1040 Exclusive use by a state, political subdivision of a state, or the District of Columbia. 2009 1040 In an aircraft or vehicle owned by an aircraft museum. 2009 1040 Use in any boat operated by the United States for its exclusive use or any vessel of war of any foreign nation. 2009 1040 See Biodiesel or Renewable Diesel Mixture Credit, Alternative Fuel Credit, and Alternative Fuel Mixture Credit, later. 2009 1040 Refunds of Second Tax The tax on dyed diesel fuel for inland waterways fuel use applies at the rate listed on Form 720. 2009 1040 This is in addition to all other taxes imposed on the sale or use of the fuel. 2009 1040 The section 4081(e) refund (discussed below) cannot be claimed. 2009 1040 If the tax is paid and reported to the government on more than one taxable event for a taxable fuel under section 4081, the person paying the “second tax” may claim a refund (without interest) of that tax if certain conditions and reporting requirements are met. 2009 1040 No credit against any tax is allowed for this tax. 2009 1040 For information about taxable events, see the discussions under Gasoline, Diesel Fuel and Kerosene and Kerosene for Use in Aviation in chapter 1. 2009 1040 Conditions to allowance of refund. 2009 1040   A claim for refund of the tax is allowed only if all the following conditions are met. 2009 1040 A tax on the fuel was paid to the government and not credited or refunded (the “first tax”). 2009 1040 After the first tax was imposed, another tax was imposed on the same fuel and was paid to the government (the “second tax”). 2009 1040 The person that paid the second tax filed a timely claim for refund containing the information required (see Refund claim, later). 2009 1040 The person that paid the first tax has met the reporting requirements, discussed next. 2009 1040 Reporting requirements. 2009 1040   Generally, the person that paid the first tax must file a “First Taxpayer's Report” with its Form 720 for the quarter to which the report relates. 2009 1040 A model first taxpayer's report is shown in the Appendix as Model Certificate B. 2009 1040 The report must contain all information needed to complete the model. 2009 1040   By the due date for filing the Form 720, you must also send a separate copy of the report to the following address. 2009 1040 Department of the Treasury Internal Revenue Service  Cincinnati, OH 45999-0555 Write “EXCISE – FIRST TAXPAYER'S REPORT” across the top of that copy. 2009 1040 Optional reporting. 2009 1040   A first taxpayer's report is not required for the tax imposed on: Removal at a terminal rack, Nonbulk entries into the United States, and Removals or sales by blenders. 2009 1040 However, if the person liable for the tax expects that another tax will be imposed on that fuel, that person should (but is not required to) file a first taxpayer's report. 2009 1040 Providing information. 2009 1040   The first taxpayer must give a copy of the report to the buyer of the fuel within the bulk transfer/terminal system or to the owner of the fuel immediately before the first tax was imposed, if the first taxpayer is not the owner at that time. 2009 1040 If an optional report is filed, a copy should (but is not required to) be given to the buyer or owner. 2009 1040   A person that receives a copy of the first taxpayer's report and later sells the fuel within the bulk transfer/terminal system must give the copy and a “Statement of Subsequent Seller” to the buyer. 2009 1040 If the later sale is outside the bulk transfer/terminal system and that person expects that another tax will be imposed, that person should (but is not required to) give the copy and the statement to the buyer. 2009 1040 A model statement of subsequent seller is shown in the Appendix as Model Certificate A. 2009 1040 The statement must contain all information necessary to complete the model. 2009 1040   If the first taxpayer's report relates to fuel sold to more than one buyer, copies of that report must be made when the fuel is divided. 2009 1040 Each buyer must be given a copy of the report. 2009 1040 Refund claim. 2009 1040   You must have filed Form 720 and paid the second tax before you file for a refund of that tax. 2009 1040 You must make your claim for refund on Form 8849. 2009 1040 Complete Schedule 5 (Form 8849) and attach it to your Form 8849. 2009 1040 Do not include this claim with a claim under another tax provision. 2009 1040 You must not have included the second tax in the price of the fuel and must not have collected it from the purchaser. 2009 1040 You must submit the following information with your claim. 2009 1040 A copy of the first taxpayer's report (discussed earlier). 2009 1040 A copy of the statement of subsequent seller if the fuel was bought from someone other than the first taxpayer. 2009 1040 Definitions of Nontaxable Uses This section provides definitions of the terms used in Table 2-1 for nontaxable uses. 2009 1040 If applicable, the type of use number from Table 2-1 is indicated in each heading. 2009 1040 Type of use table. 2009 1040   The first column of the table is the number you enter on Form 4136, Form 8849, or Schedule C (Form 720) for that type of use. 2009 1040 For type of use 2, the mobile machinery parenthetical applies only to Form 8849 and Form 720. 2009 1040 Table 2-1. 2009 1040 Type of Use Table No. 2009 1040 Type of Use 1 On a farm for farming purposes 2 Off-highway business use (for business use other than in a highway vehicle registered or required to be registered for highway use) (other than use in mobile machinery) 3 Export 4 In a boat engaged in commercial fishing 5 In certain intercity and local buses 6 In a qualified local bus 7 In a bus transporting students and employees of schools (school buses) 8 For diesel fuel and kerosene (other than kerosene used in aviation) used other than as a fuel in the propulsion engine of a train or diesel-powered highway vehicle (but not off-highway business use) 9 In foreign trade 10 Certain helicopter and fixed-wing aircraft uses 11 Exclusive use by a qualified blood collector organization 12 In a highway vehicle owned by the United States that is not used on a highway 13 Exclusive use by a nonprofit educational organization 14 Exclusive use by a state, political subdivision of a state, or the District of Columbia 15 In an aircraft or vehicle owned by an aircraft museum 16 In military aircraft On a farm for farming purposes (No. 2009 1040 1). 2009 1040   On a farm for farming purposes means fuel used in carrying on a trade or business of farming, on a farm in the United States, and for farming purposes. 2009 1040 Farm. 2009 1040   A farm includes livestock, dairy, fish, poultry, fruit, fur-bearing animals, and truck farms; orchards; plantations; ranches; nurseries; ranges; and feed yards for fattening cattle. 2009 1040 It also includes structures such as greenhouses used primarily for the raising of agricultural or horticultural commodities. 2009 1040 A fish farm is an area where fish are grown or raised — not merely caught or harvested. 2009 1040 Farming purposes. 2009 1040   As an owner, tenant, or operator, you use fuel on a farm for farming purposes if you use it in any of the following ways. 2009 1040 To cultivate the soil or to raise or harvest any agricultural or horticultural commodity. 2009 1040 To raise, shear, feed, care for, train, or manage livestock, bees, poultry, fur-bearing animals, or wildlife. 2009 1040 To operate, manage, conserve, improve, or maintain your farm and its tools and equipment. 2009 1040 To handle, dry, pack, grade, or store any raw agricultural or horticultural commodity. 2009 1040 For this use to qualify, you must have produced more than half the commodity so treated during the tax year. 2009 1040 Commodity means a single raw product. 2009 1040 For example, apples and peaches are two separate commodities. 2009 1040 To plant, cultivate, care for, or cut trees or to prepare (other than sawing logs into lumber, chipping, or other milling) trees for market, but only if the planting, etc. 2009 1040 , is incidental to your farming operations. 2009 1040 Your tree operations will be incidental only if they are minor in nature when compared to the total farming operations. 2009 1040   If any other person, such as a neighbor or custom operator, performs a service for you on your farm for any of the purposes listed in (1) or (2), you are considered to be the ultimate purchaser that used the fuel on a farm for farming purposes. 2009 1040 However, see Custom application of fertilizer and pesticide, next. 2009 1040   If doubt exists whether the owner, the tenant, or the operator of the farm bought the fuel, determine who bore the cost of the fuel. 2009 1040 For example, if the owner of a farm and the tenant equally share the cost of gasoline that is used on a farm for farming purposes, each can claim a credit for the tax on one-half the fuel used. 2009 1040 Custom application of fertilizer and pesticide. 2009 1040   Fuel used on a farm for farming purposes includes fuel used in the application of fertilizer, pesticides, or other substances, including aerial applications. 2009 1040 Generally, the applicator is treated as having used the fuel on a farm for farming purposes. 2009 1040 For aviation gasoline, the aerial applicator makes the claim as the ultimate purchaser. 2009 1040 For kerosene used in aviation, the ultimate purchaser may make the claim or waive their right to make the claim to the registered ultimate vendor. 2009 1040 Fuel used between airfield and farm. 2009 1040   Fuel used by an aerial applicator for the direct flight between the airfield and one or more farms is treated as a farming purpose. 2009 1040 Fuel not used for farming. 2009 1040   Fuel is not used on a farm for farming purposes if it is used in any of the following ways. 2009 1040 Off the farm, such as on the highway or in noncommercial aviation, other than fuel used between the airfield and farm described above, even if the fuel is used in transporting livestock, feed, crops, or equipment. 2009 1040 For personal use, such as mowing the lawn. 2009 1040 In processing, packaging, freezing, or canning operations. 2009 1040 In processing crude gum into gum spirits of turpentine or gum resin or in processing maple sap into maple syrup or maple sugar. 2009 1040 Off-highway business use (No. 2009 1040 2). 2009 1040   Off-highway business use means fuel used in a trade or business or in an income-producing activity other than as a fuel in a highway vehicle registered or required to be registered for use on public highways. 2009 1040 The terms “highway vehicle,” “public highway,” and “registered” are defined below. 2009 1040 Do not consider any use in a boat as an off-highway business use. 2009 1040   Off-highway business use includes fuels used in any of the following ways. 2009 1040 In stationary machines such as generators, compressors, power saws, and similar equipment. 2009 1040 For cleaning purposes. 2009 1040 In forklift trucks, bulldozers, and earthmovers. 2009 1040   Generally, this use does not include nonbusiness use of fuel, such as use by minibikes, snowmobiles, power lawn mowers, chain saws, and other yard equipment. 2009 1040 Example. 2009 1040 Caroline owns a landscaping business. 2009 1040 She uses power lawn mowers and chain saws in her business. 2009 1040 The gasoline used in the power lawn mowers and chain saws qualifies as fuel used in an off-highway business use. 2009 1040 The gasoline used in her personal lawn mower at home does not qualify. 2009 1040 Highway vehicle. 2009 1040   A highway vehicle is any self-propelled vehicle designed to carry a load over public highways, whether or not it is also designed to perform other functions. 2009 1040 Examples of vehicles designed to carry a load over public highways are passenger automobiles, motorcycles, buses, and highway-type trucks and truck tractors. 2009 1040 A vehicle is a highway vehicle even though the vehicle's design allows it to perform a highway transportation function for only one of the following. 2009 1040 A particular type of load, such as passengers, furnishings, and personal effects (as in a house, office, or utility trailer). 2009 1040 A special kind of cargo, goods, supplies, or materials. 2009 1040 Some off-highway task unrelated to highway transportation, except as discussed next. 2009 1040 Vehicles not considered highway vehicles. 2009 1040   Generally, the following kinds of vehicles are not considered highway vehicles for purposes of the credit or refund of fuel taxes. 2009 1040 Specially designed mobile machinery for nontransportation functions. 2009 1040 A self-propelled vehicle is not a highway vehicle if all the following apply. 2009 1040 The chassis has permanently mounted to it machinery or equipment used to perform certain operations (construction, manufacturing, drilling, mining, timbering, processing, farming, or similar operations) if the operation of the machinery or equipment is unrelated to transportation on or off the public highways. 2009 1040 The chassis has been specially designed to serve only as a mobile carriage and mount (and power source, if applicable) for the machinery or equipment, whether or not the machinery or equipment is in operation. 2009 1040 The chassis could not, because of its special design and without substantial structural modification, be used as part of a vehicle designed to carry any other load. 2009 1040 The vehicle must have traveled less than 7,500 miles on public highways during the taxable year. 2009 1040 Vehicles specially designed for off-highway transportation. 2009 1040 A vehicle is not treated as a highway vehicle if the vehicle is specially designed for the primary function of transporting a particular type of load other than over the public highway and because of this special design, the vehicle's capability to transport a load over a public highway is substantially limited or impaired. 2009 1040 To make this determination, you can take into account the vehicle's size, whether the vehicle is subject to licensing, safety, or other requirements, and whether the vehicle can transport a load at a sustained speed of at least 25 miles per hour. 2009 1040 It does not matter that the vehicle can carry heavier loads off highway than it is allowed to carry over the highway. 2009 1040 Nontransportation trailers and semitrailers. 2009 1040 A trailer or semi-trailer is not treated as a highway vehicle if it is specially designed to function only as an enclosed stationary shelter for carrying on a nontransportation function at an off-highway site. 2009 1040 For example, a trailer that is capable only of functioning as an office for an off-highway construction operation is not a highway vehicle. 2009 1040 Public highway. 2009 1040   A public highway includes any road in the United States that is not a private roadway. 2009 1040 This includes federal, state, county, and city roads and streets. 2009 1040 Registered. 2009 1040   A vehicle is considered registered when it is registered or required to be registered for highway use under the law of any state, the District of Columbia, or any foreign country in which it is operated or situated. 2009 1040 Any highway vehicle operated under a dealer's tag, license, or permit is considered registered. 2009 1040 A highway vehicle is not considered registered solely because a special permit allows the vehicle to be operated at particular times and under specified conditions. 2009 1040 Dual use of propulsion motor. 2009 1040   Off-highway business use does not include any fuel used in the propulsion motor of a registered highway vehicle even though that motor also operates special equipment by means of a power take-off or power transfer. 2009 1040 It does not matter if the special equipment is mounted on the vehicle. 2009 1040 Example. 2009 1040 The motor of a registered concrete-mixer truck operates both the engine and the mixing unit by means of a power take-off. 2009 1040 The fuel used in the motor to run the mixer is not off-highway business use. 2009 1040 Use in separate motor. 2009 1040   Off-highway business use includes fuel used in a separate motor to operate special equipment, such as a refrigeration unit, pump, generator, or mixing unit. 2009 1040 If you draw fuel from the same tank that supplies fuel to the propulsion motor, you must figure the quantity used in the separate motor operating the special equipment. 2009 1040 You may make a reasonable estimate based on your operating experience and supported by your records. 2009 1040   You can use devices that measure the miles the vehicle has traveled (such as hubometers) to figure the gallons of fuel used to propel the vehicle. 2009 1040 Add to this amount the fuel consumed while idling or warming up the motor before propelling the vehicle. 2009 1040 The difference between your total fuel used and the fuel used to propel the vehicle is the fuel used in the separate motor. 2009 1040 Example. 2009 1040 Hazel owns a refrigerated truck. 2009 1040 It has a separate motor for the refrigeration unit. 2009 1040 The same tank supplies both motors. 2009 1040 Using the truck's hubometer, Hazel figures that 90% of the fuel was used to propel the truck. 2009 1040 Therefore, 10% of the fuel is used in an off-highway business use. 2009 1040 Fuel lost or destroyed. 2009 1040   You cannot treat fuel lost or destroyed through spillage, fire, or other casualty as fuel used in an off-highway business use. 2009 1040 Export (No. 2009 1040 3). 2009 1040   Export means fuel transported from the United States with the intention that the fuel remain in a foreign country or possession of the United States. 2009 1040 Fuel is not exported if it is in the fuel supply tank of a vehicle or aircraft. 2009 1040 In a boat engaged in commercial fishing (No. 2009 1040 4). 2009 1040   In a boat engaged in commercial fishing means fuel used in taking, catching, processing, or transporting fish, shellfish, or other aquatic life for commercial purposes, such as selling or processing the catch, on a specific trip basis. 2009 1040 They include boats used in both fresh and salt water fishing. 2009 1040 They do not include boats used for both sport fishing and commercial fishing on the same trip. 2009 1040 In certain intercity and local buses (No. 2009 1040 5). 2009 1040   In certain intercity and local buses means fuel used in a bus engaged in furnishing (for compensation) passenger land transportation available to the general public. 2009 1040 The bus must be engaged in one of the following activities. 2009 1040 Scheduled transportation along regular routes. 2009 1040 Nonscheduled operations if the seating capacity of the bus is at least 20 adults, not including the driver. 2009 1040 Vans and similar vehicles used for van-pooling or taxi service do not qualify. 2009 1040 Available to the general public. 2009 1040   This means you offer service to more than a limited number of persons or organizations. 2009 1040 If a bus operator normally provides charter operations through travel agencies but has buses available for chartering by the general public, this service is available to the general public. 2009 1040 A bus does not qualify when its operator uses it to provide exclusive services to only one person, group, or organization. 2009 1040 Also, intercity bus transportation does not include transporting students and employees of schools or intercity transportation in a qualified local bus. 2009 1040 In a qualified local bus (No. 2009 1040 6). 2009 1040   In a qualified local bus means fuel used in a bus meeting all the following requirements. 2009 1040 It is engaged in furnishing (for compensation) intracity passenger land transportation available to the general public. 2009 1040 It operates along scheduled, regular routes. 2009 1040 It has a seating capacity of at least 20 adults (excluding the driver). 2009 1040 It is under contract with (or is receiving more than a nominal subsidy from) any state or local government to furnish the transportation. 2009 1040 Intracity passenger land transportation. 2009 1040   This is the land transportation of passengers between points located within the same metropolitan area. 2009 1040 It includes transportation along routes that cross state, city, or county boundaries if the routes remain within the metropolitan area. 2009 1040 Under contract. 2009 1040   A bus is under contract with a state or local government only if the contract imposes a bona fide obligation on the bus operator to furnish the transportation. 2009 1040 More than a nominal subsidy. 2009 1040   A subsidy is more than nominal if it is reasonably expected to exceed an amount equal to 3 cents multiplied by the number of gallons of fuel used in buses on subsidized routes. 2009 1040 A company that operates its buses along subsidized and unsubsidized intracity routes may consider its buses qualified local buses only when the buses are used on the subsidized intracity routes. 2009 1040 In a school bus (No. 2009 1040 7). 2009 1040   In a school bus means fuel used in a bus engaged in the transportation of students or employees of schools. 2009 1040 A school is an educational organization with a regular faculty and curriculum and a regularly enrolled body of students who attend the place where the educational activities occur. 2009 1040 For diesel fuel and kerosene (other than kerosene used in aviation) used other than as a fuel (No. 2009 1040 8). 2009 1040   Diesel fuel and kerosene (other than kerosene used in aviation) used other than as a fuel in the propulsion engine of a diesel-powered highway vehicle or diesel-powered train (not including off-highway business use) means undyed diesel fuel and undyed kerosene used: For home heating, lighting, and cooking; In boats; In stationary machines, such as generators and compressors; For cleaning purposes; or In minibikes and snowmobiles. 2009 1040 In foreign trade (No. 2009 1040 9). 2009 1040   In foreign trade means fuel used in civil aircraft employed in foreign trade or trade between the United States and any of its possessions. 2009 1040 The term trade includes the transportation of persons or property for hire and the making of the necessary preparations for such transportation. 2009 1040 In the case of aircraft registered in a foreign country, the country must allow reciprocal benefits for aircraft registered in the United States. 2009 1040 Certain helicopter and fixed-wing aircraft uses (No. 2009 1040 10). 2009 1040   Includes: Certain helicopter uses. 2009 1040   Certain helicopter uses means fuel used by a helicopter for any of the following purposes. 2009 1040 Transporting individuals, equipment, or supplies in the exploration for, or the development or removal of, hard minerals, oil, or gas. 2009 1040 Planting, cultivating, cutting, transporting, or caring for trees (including logging operations). 2009 1040 Providing emergency medical transportation. 2009 1040   During a use described in items (1) and (2), the helicopter must not take off from, or land at, a facility eligible for assistance under the Airport and Airway Development Act of 1970, or otherwise use services provided pursuant to section 44509 or 44913(b) or subchapter I of chapter 471 of title 49, United States Code. 2009 1040 For item (1), treat each flight segment as a separate flight. 2009 1040 Fixed-wing aircraft uses. 2009 1040   Fixed-wing aircraft uses means fuel used by a fixed-wing aircraft for any of the following purposes. 2009 1040 Planting, cultivating, cutting, transporting, or caring for trees (including logging operations). 2009 1040 Providing emergency medical transportation. 2009 1040 The aircraft must be equipped for and exclusively dedicated on that flight to acute care emergency medical services. 2009 1040 During a use described in item (1), the aircraft must not take off from, or land at, a facility eligible for assistance under the Airport and Airway Development Act of 1970, or otherwise use services provided pursuant to section 44509 or 44913(b) or subchapter I of chapter 471 of title 49, United States Code. 2009 1040 Exclusive use by a qualified blood collector organization (No. 2009 1040 11). 2009 1040   Exclusive use by a qualified blood collector organization means fuel used by the qualified blood collector organization for its exclusive use in the collection, storage, or transportation of blood. 2009 1040 Qualified blood collector organization. 2009 1040   A qualified blood collector organization is one that is: Described in section 501(c)(3) and exempt from tax under section 501(a), Primarily engaged in the activity of collecting human blood, Registered by the IRS, and Registered by the Food and Drug Administration to collect blood. 2009 1040 In a highway vehicle owned by the United States that is not used on a highway (No. 2009 1040 12). 2009 1040   In a highway vehicle owned by the United States that is not used on a highway means fuel used in a vehicle that was not used on public highways during the period covered by the claim. 2009 1040 This use applies whether or not the vehicle is registered or required to be registered for highway use. 2009 1040 Exclusive use by a nonprofit educational organization (No. 2009 1040 13). 2009 1040   Exclusive use by a nonprofit educational organization means fuel used by an organization exempt from income tax under section 501(a) that meets both of the following requirements. 2009 1040 It has a regular faculty and curriculum. 2009 1040 It has a regularly enrolled body of students who attend the place where the instruction normally occurs. 2009 1040   A nonprofit educational organization also includes a school operated by a church or other organization described in section 501(c)(3) if the school meets the above requirements. 2009 1040 Exclusive use by a state, political subdivision of a state, or the District of Columbia (No. 2009 1040 14). 2009 1040   Exclusive use by a state, political subdivision of a state, or the District of Columbia means fuel purchased by the state or local government for its exclusive use. 2009 1040 A state or local government is any state, any political subdivision thereof, or the District of Columbia. 2009 1040 An Indian tribal government is treated as a state only if the fuel is used in an activity that involves the exercise of an essential tribal government function. 2009 1040 Gasoline, diesel fuel, and kerosene used by the American Red Cross is considered to be the use of these fuels by a state. 2009 1040 In an aircraft or vehicle owned by an aircraft museum (No. 2009 1040 15). 2009 1040   In an aircraft or vehicle owned by an aircraft museum means fuel used in an aircraft or vehicle that is owned by an organization that meets all the following requirements. 2009 1040 It is exempt from income tax as an organization described in section 501(c)(3). 2009 1040 It is operated as a museum under a state (or District of Columbia) charter. 2009 1040 It is operated exclusively for acquiring, exhibiting, and caring for aircraft of the type used for combat or transport in  World War II. 2009 1040   The aircraft or vehicle (such as a ground servicing vehicle for aircraft) must be used exclusively for the purposes described in item (3). 2009 1040 In military aircraft (No. 2009 1040 16). 2009 1040   In a military aircraft means fuel used in an aircraft owned by the United States or any foreign nation and constituting a part of its armed forces. 2009 1040 In commercial aviation (other than foreign trade). 2009 1040   See Commercial aviation, earlier, for the definition. 2009 1040 Use in a train. 2009 1040   Use in a train means fuel used in the propulsion engine of equipment or machinery that rides on rails. 2009 1040 This includes use in a locomotive, work train, switching engine, and track maintenance machine. 2009 1040 Biodiesel or Renewable Diesel Mixture Credit, Alternative Fuel Credit, and Alternative Fuel Mixture Credit For alternative fuel mixtures produced after December 31, 2011, see How to Claim the Credit below. 2009 1040 The section 6426 credit for biodiesel and alternative fuel consists of the biodiesel or renewable diesel mixture credit, alternative fuel credit, and alternative fuel mixture credit. 2009 1040 Biodiesel or renewable diesel mixture credit claimant. 2009 1040   Claimant produced a biodiesel mixture by mixing biodiesel with diesel fuel. 2009 1040 Claimant produced a renewable diesel mixture by mixing renewable diesel with liquid fuel (other than renewable diesel). 2009 1040   The person that produced and sold or used the mixture in their trade or business is the only person eligible to make this claim. 2009 1040 The credit is based on the gallons of biodiesel or renewable diesel in the mixture. 2009 1040 Renewable diesel does not include any fuel derived from coprocessing biomass (as defined in section 45K(c)(3)) with a feedstock that is not biomass. 2009 1040 Claim requirements. 2009 1040   See the Instructions for Form 720 for the biodiesel or renewable diesel mixture claim requirements. 2009 1040 Alternative fuel credit claimant. 2009 1040   For the alternative fuel credit, the registered alternative fueler who (1) sold an alternative fuel at retail delivered it into the fuel supply tank of a motor vehicle or motorboat, (2) sold an alternative fuel, delivered it in bulk taxable use in a motor vehicle or motorboat, and received required statement from the buyer, (3) used an alternative fuel (not sold at retail or in bulk as previously described) motor vehicle or motorboat, or (4) sold an alternative fuel used as a fuel in aviation is the only person eligible to make this claim. 2009 1040 Carbon capture requirement. 2009 1040   A credit for Fischer-Tropsch process liquid fuel derived from coal (including peat) can be claimed only if the fuel is derived from coal produced at a gasification facility that separates and sequesters at least 75% of the facility's total carbon dioxide emissions. 2009 1040 Alternative fuel credit. 2009 1040   The registered alternative fueler is the person eligible to make the claim. 2009 1040 An alternative fueler is the person liable for tax on alternative fuel under the rules for taxable events for Other Fuels (discussed in chapter 1) or would be liable but for an exemption for nontaxable uses. 2009 1040 An alternative fueler includes a person who sells for use or uses an alternative fuel in aviation. 2009 1040 Alternative fuel mixture credit claimant. 2009 1040   For the alternative fuel mixture credit, the registered alternative fueler that produced and sold or used the mixture as a fuel in their trade or business is the only person eligible to make this claim. 2009 1040 The credit is based on the gallons of alternative fuel in the mixture. 2009 1040 An alternative fuel mixture is a mixture of alternative fuel and section 4081 taxable fuel (gasoline, diesel fuel, or kerosene). 2009 1040 Registration. 2009 1040   You must be registered by the IRS to be eligible to claim the section 6426 fuel credit. 2009 1040 See Registration Requirements in chapter 1. 2009 1040 Credits for fuel provide incentive for United States production. 2009 1040   The section 6426 fuel credit may not be claimed for alternative fuel that is produced outside the United States for use as a fuel outside the United States. 2009 1040 The United States includes any possession of the United States. 2009 1040 Credit for fuels derived from paper or pulp production. 2009 1040   Credit for alternative fuels and alternative fuel mixtures for any fuel derived from the production of paper or pulp are not available for fuel sold or used on or after December 31, 2009. 2009 1040 How to Claim the Credit Any biodiesel or renewable diesel mixture credit must first be claimed on Schedule C to reduce your taxable fuel liability reported on Form 720. 2009 1040 Any excess credit may be claimed on Schedule C (Form 720), Schedule 3 (Form 8849), Form 4136, or Form 8864, Biodiesel and Renewable Diesel Fuels Credit. 2009 1040 See Notice 2005-4 and the Instructions for Form 720 for more information. 2009 1040 Also see Notice 2013-26 on page 984 of I. 2009 1040 R. 2009 1040 B. 2009 1040 2013-18 at www. 2009 1040 irs. 2009 1040 gov/pub/irs-irbs/irb13-18. 2009 1040 pdf; and see chapter 2, later. 2009 1040 Coordination with income tax credit. 2009 1040   Only one credit may be taken for any amount of biodiesel or renewable diesel. 2009 1040 If any amount is claimed (or will be claimed) for any amount of biodiesel or renewable diesel on Form 720, Form 8849, or Form 4136, then a claim cannot be made on Form 8864 for that amount of biodiesel or renewable diesel. 2009 1040   Any alternative fuel credit must first be claimed on Schedule C (Form 720) to reduce your section 4041 taxable fuel liability for alternative fuel and CNG reported on Form 720. 2009 1040 Any excess credit may claimed on Schedule C (Form 720), Schedule 3 (Form 8849), or Form 4136. 2009 1040   For alternative fuel mixtures produced after December 31, 2011, the alternative fuel mixture credit can be claimed on Schedule C (Form 720), not on Form 4136 or Schedule 3 (Form 8849), and only to the extent of your section 4081 taxable fuel liability for gasoline, diesel fuel and kerosene reported on Form 720. 2009 1040   Calculate the limitation for alternative fuel mixtures separately and enter on Schedule C (Form 720), line 14, only the gallons of mixtures that do not exceed your section 4081 taxable fuel liability. 2009 1040 Filing Claims This section tells you how to make a claim for a credit or refund of excise taxes on fuels. 2009 1040 This section also covers recordkeeping requirements and when to include the credit or refund in your income. 2009 1040 Generally, you will provide all the information needed to claim a credit or refund when you properly complete Form 8849, Form 4136, Schedule C (Form 720), Form 6478, or Form 8864. 2009 1040 In some cases, you will have to attach additional information. 2009 1040 You need to keep records that support your claim for a credit or refund. 2009 1040 Keep at your principal place of business all records needed to enable the IRS to verify that you are the person entitled to claim a credit or refund and the amount you claimed. 2009 1040 Ultimate purchaser. 2009 1040   Ultimate purchasers may make claims for the nontaxable use of fuels on Form 4136, Schedule 1 (Form 8849), and Schedule C (Form 720) if reporting excise tax liability on that return. 2009 1040 If you are an ultimate purchaser, you must keep the following records. 2009 1040 The number of gallons purchased and used during the period covered by your claim. 2009 1040 The dates of the purchases. 2009 1040 The names and addresses of suppliers and amounts purchased from each in the period covered by your claim. 2009 1040 The nontaxable use for which you used the fuel. 2009 1040 The number of gallons used for each nontaxable use. 2009 1040 It is important that your records show separately the number of gallons used for each nontaxable use that qualifies as a claim. 2009 1040 If the fuel is exported, you must have proof of exportation. 2009 1040   For more information about keeping records, see Publication 583, Starting a Business and Keeping Records, or chapter 1 of Publication 17, Your Federal Income Tax for Individuals. 2009 1040 Exceptions. 2009 1040    Generally, the ultimate purchaser may not claim a credit or refund for undyed diesel fuel, undyed kerosene, or kerosene for use in aviation sold for the exclusive use of a state or local government. 2009 1040 However, see Claims by credit card issuers, later, for an exception. 2009 1040 The ultimate purchaser may not claim a credit or refund as follows. 2009 1040 The ultimate purchaser of gasoline or aviation gasoline used by a state or local government for its exclusive use or by a nonprofit educational organization for its exclusive use may waive its right to make a claim by providing a certificate that is signed under penalties of perjury by a person authorized to bind the ultimate purchaser and is in the same format as the Model Certificate M. 2009 1040 A new certificate is required each year or when any information in the current certificate expires. 2009 1040 The ultimate purchaser of kerosene for use in commercial aviation or noncommercial aviation (other than nonexempt, noncommercial aviation and exclusive use by a state, political subdivision of a state, or the District of Columbia) may waive its right to make a claim by providing a waiver that is signed under penalties of perjury by a person authorized to bind the ultimate purchaser and is in the same format as the Model Waiver L. 2009 1040 A new waiver is required each year or when any information in the current waiver expires. 2009 1040 The ultimate purchaser of undyed diesel fuel or undyed kerosene used in certain intercity and local buses may waive its right to make a claim by providing a waiver that is signed under penalties of perjury by a person authorized to bind the ultimate purchaser and is in the same format as the Model Waiver N. 2009 1040 A new waiver is required each year or when any information in the current waiver expires. 2009 1040 The ultimate purchaser of kerosene for use in nonexempt, noncommercial aviation must provide a certificate that is signed under penalties of perjury by a person authorized to bind the ultimate purchaser and is in the same format as the Model Certificate Q. 2009 1040 A new certificate is required each year or when any information in the current certificate expires. 2009 1040 Registered ultimate vendor. 2009 1040   Registered ultimate vendors may make claims for certain sales of fuels on Form 4136, Schedule 2 (Form 8849), and Schedule C (Form 720) if reporting excise tax liability on that return. 2009 1040 If you are a registered ultimate vendor, you must keep certain information pertaining to the sale of the fuel. 2009 1040   To make a claim, you must have sold the fuel at a tax-excluded price, repaid the tax to the buyer, or obtained the buyer's written consent to the allowance of the claim. 2009 1040 You are required to have a valid certificate or waiver in your possession in order to make the claim. 2009 1040   In addition, you must have a registration number that has not been revoked or suspended. 2009 1040 See Form 637. 2009 1040 State use. 2009 1040   To make a claim as an ultimate vendor (state), you must have a UV registration number and the fuel cannot be purchased with a credit card as explained below. 2009 1040 If you sell undyed diesel fuel, undyed kerosene, or kerosene for use in aviation for use by a state or local government, you must keep the following information. 2009 1040 The name and taxpayer identification number of each person (government unit) that bought the fuel. 2009 1040 The number of gallons sold to each person. 2009 1040 An unexpired certificate from the buyer. 2009 1040 See Model Certificate P in the Appendix. 2009 1040 The certificate expires on the earlier of 1 year after the date of the certificate or the date a new certificate is given to the registered ultimate vendor. 2009 1040 Nonprofit educational organization and state use. 2009 1040   To make a claim as an ultimate vendor (nonprofit educational organization or state), you must have a UV registration number and the fuel cannot be purchased with a credit card as explained later. 2009 1040 If you sell gasoline or aviation gasoline to a nonprofit educational organization for its exclusive use or to a state or local government for its exclusive use, you must keep the following information. 2009 1040 The name and taxpayer identification number of each person (nonprofit educational organization or government unit) that bought the fuel. 2009 1040 The number of gallons sold to each person. 2009 1040 An unexpired certificate from the buyer. 2009 1040 See Model Certificate M in the Appendix. 2009 1040  The certificate expires on the earlier of 1 year after the date of the certificate or the date a new certificate is given to the registered ultimate vendor. 2009 1040 Blocked pump. 2009 1040   To make a claim as an ultimate vendor (blocked pump), you must have a UP registration number. 2009 1040 If you sell undyed kerosene (other than kerosene for use in aviation) from a pump that qualifies as a blocked pump because it is locked by you after each sale and is unlocked by you at the request of the buyer, you must keep the following information for each sale of more than 5 gallons. 2009 1040 The date of each sale. 2009 1040 The name and address of the buyer. 2009 1040 The number of gallons sold to that buyer. 2009 1040 Certain intercity and local bus use. 2009 1040   To make a claim as an ultimate vendor of undyed diesel fuel or undyed kerosene used in certain intercity and local buses, you must have a UB registration number. 2009 1040 You must keep the following information. 2009 1040 The date of each sale. 2009 1040 The name and address of the buyer. 2009 1040 The number of gallons sold to the buyer. 2009 1040 A copy of the waiver signed by the buyer at the time the credit or payment is claimed. 2009 1040 See Model Waiver N in the Appendix. 2009 1040 Kerosene for use in commercial aviation or noncommercial aviation. 2009 1040   To make a claim as an ultimate vendor of kerosene for use in commercial aviation (other than foreign trade) or noncommercial aviation (other than nonexempt, noncommercial aviation and exclusive use by a state, political subdivision of a state, or the District of Columbia), you must have a UA registration number. 2009 1040 See Kerosene for use in aviation, earlier, for a list of nontaxable uses. 2009 1040 You must keep the following information. 2009 1040 The date of each sale. 2009 1040 The name and address of the buyer. 2009 1040 The number of gallons sold to the buyer. 2009 1040 A copy of the waiver signed by the buyer at the time the credit or payment is claimed. 2009 1040 See Model Waiver L in the Appendix. 2009 1040 Kerosene for use in nonexempt, noncommercial aviation. 2009 1040   To make a claim as an ultimate vendor of kerosene for use in nonexempt, noncommercial aviation, you must have a UA registration number. 2009 1040 You must keep the following information. 2009 1040 The date of each sale. 2009 1040 The name and address of the buyer. 2009 1040 The number of gallons sold to the buyer. 2009 1040 A copy of the certificate signed by the buyer at the time the credit or payment is claimed. 2009 1040 See Model Certificate Q in the Appendix. 2009 1040 Claims by credit card issuers. 2009 1040   For sales of gasoline, aviation gasoline, diesel fuel, kerosene, or kerosene for use in aviation that are purchased by an exempt user with the use of a credit card, the registered credit card issuer is the only person who can make the claim. 2009 1040 An exempt user for this purpose is: For gasoline or aviation gasoline, a state or local government (including essential government use by an Indian tribal government) or a nonprofit educational organization; or For diesel fuel, kerosene, or kerosene for use in aviation, a state or local government (including essential government use by an Indian tribal government). 2009 1040   If gasoline is purchased without the use of a credit card, then the registered ultimate vendor of the gasoline may make the claim for refund or credit. 2009 1040 However, if the gasoline is purchased with a credit card issued to a state, but the credit card issuer is not registered by the IRS or does not meet the conditions described, the credit card issuer must collect the tax and the state may make the claim. 2009 1040   If diesel fuel, kerosene, or kerosene for use in aviation is purchased without the use of a credit card, the registered ultimate vendor may make the claim for refund or credit. 2009 1040 A state is not allowed to make a claim for these fuels. 2009 1040 However, if the diesel fuel or kerosene is purchased with a credit card issued to a state, but the credit card issuer is not registered by the IRS or does not meet the conditions described, the credit card issuer must collect the tax and the state may make the claim. 2009 1040   The claim from the credit card issuer must contain the following information as it applies to the fuel covered in the claim. 2009 1040 The total number of gallons. 2009 1040 Its registration number. 2009 1040 A statement that it has not collected the amount of tax from the ultimate purchaser or has obtained the written consent of the ultimate purchaser to make the claim. 2009 1040 A statement that it has repaid or agreed to repay the amount of tax to the ultimate vendor, has obtained the written consent of the ultimate vendor to make the claim, or has otherwise made arrangements which directly or indirectly provide the ultimate vendor with reimbursement of the tax. 2009 1040 Has in its possession an unexpired certificate similar to Model Certificate R in the Appendix and has no reason to believe any of the information in the certificate is false. 2009 1040 Taxpayer identification number. 2009 1040   To file a claim, you must have a taxpayer identification number. 2009 1040 Your taxpayer identification number can be an: Employer identification number (EIN), Social security number (SSN), or Individual taxpayer identification number (ITIN), if you are an alien individual and do not have and are not eligible to get an SSN. 2009 1040   If you normally file only a U. 2009 1040 S. 2009 1040 individual income tax return (such as Form 1040 or 1040NR), use your SSN or ITIN. 2009 1040 You get an SSN by filing Form SS-5, Application for a Social Security Card, with the Social Security Administration. 2009 1040 To get an ITIN, file Form W-7, Application for IRS Individual Taxpayer Identification Number, with the IRS. 2009 1040   If you operate a business, use your EIN. 2009 1040 If you do not have an EIN, you may apply for one online. 2009 1040 Go to the IRS website at irs. 2009 1040 gov/businesses/small and click on the “Employer ID Numbers (EINs)” link. 2009 1040 You may also apply for an EIN by calling 1-800-829-4933, or you can fax or mail Form SS-4, Application for Employer Identification Number, to the IRS. 2009 1040 Claiming A Refund Generally, you may claim a refund of excise taxes on Form 8849. 2009 1040 Complete and attach to Form 8849 the appropriate Form 8849 schedules. 2009 1040 The instructions for Form 8849 and the separate instructions for each schedule explain the requirements for making a claim for refund. 2009 1040 If you file Form 720, you can use the Schedule C (Form 720) for your refund claims for the quarter. 2009 1040 See the Instructions for Form 720. 2009 1040 Do not claim a refund on Form 8849 for any amount for which you have filed or will file a claim on Schedule C (Form 720) or Form 4136. 2009 1040 The alternative fuel mixture credit must be claimed on Schedule C (Form 720) against your section 4081 taxable fuel liability for gasoline, diesel, and kerosene and any excess is not allowed. 2009 1040 The alternative fuel credit must first be claimed on Schedule C (Form 720) against your section 4041 taxable fuel liability for alternative fuel and CNG. 2009 1040 To the extent the alternative fuel credit exceeds this taxable fuel liability, a payment is allowed and may be claimed as a credit on Schedule C (Form 720), or as an income tax credit on Forms 4136, 6478, or 8864, as applicable. 2009 1040 Only one claim may be made for any particular amount of alternative fuel. 2009 1040 Claiming a Credit on Form 4136 For alternative fuel mixtures produced after December 31, 2011, the alternative fuel mixture credit cannot be claimed on Form 4136. 2009 1040 See Biodiesel or Renewable Diesel Mixture Credit, Alternative Fuel Credit and Alternative Fuel Mixture Credit in chapter 2, earlier. 2009 1040 A credit may be claimed for certain uses and sales of fuels on Form 4136 when you file your income tax return at the end of the year. 2009 1040 If you meet certain requirements (discussed earlier), you may be able to make a claim during the year. 2009 1040 Credit only. 2009 1040   You can claim the following taxes only as a credit on Form 4136. 2009 1040 Tax on fuels used for nontaxable uses if the total for your tax year is less than $750. 2009 1040 Tax on fuel you did not include in any claim for refund previously filed for any quarter of your tax year. 2009 1040 Tax on fuel you used in mobile machinery (off-highway business use) that traveled less than 7,500 miles on public highways. 2009 1040 Do not claim a credit for any amount for which you have filed a refund claim on Form 8849 or credit on Schedule C (Form 720). 2009 1040 When to file. 2009 1040   You can claim a fuel tax credit on your income tax return for the year you used the fuel (or sold the fuel in the case of a registered ultimate vendor claim). 2009 1040 You may be able to make a fuel tax claim on an amended income tax return for the year you used the fuel. 2009 1040 Generally, you must file an amended return by the later of 3 years from the date you filed your original return or within 2 years from the date you paid the income tax. 2009 1040 How to claim a credit. 2009 1040   How you claim a credit depends on whether you are an individual, partnership, corporation, S corporation, or farmers' cooperative association. 2009 1040 Individuals. 2009 1040   You claim the credit on the “Credits from” line of Form 1040. 2009 1040 Also check box b on that line. 2009 1040 If you would not otherwise have to file an income tax return, you must do so to get a fuel tax credit. 2009 1040 Partnerships. 2009 1040   Partnerships (other than electing large partnerships) claim the credit by including a statement on Schedule K-1 (Form 1065), Partner's Share of Income, Deductions, Credits, etc. 2009 1040 , showing each partner's share of the number of gallons of each fuel sold or used for a non