Filing Your Taxes Online is Fast, Easy and Secure.
Start now and receive your tax refund in as little as 7 days.

1. Get Answers

Your online questions are customized to your unique tax situation.

2. Maximize your Refund

Find tax credits for everything from school tuition to buying a hybri

3. E-File for FREE

E-file free with direct deposit to get your refund in as few as 7 days.

Filing your taxes with paper mail can be difficult and it could take weeks for your refund to arrive. IRS e-file is easy, fast and secure. There is no paperwork going to the IRS so tax refunds can be processed in as little as 7 days with direct deposit. As you prepare your taxes online, you can see your tax refund in real time.

FREE audit support and representation from an enrolled agent – NEW and only from H&R Block

Amend Taxes

H&r Block Free File 20122011 Federal Tax Form 1040 Ez InstructionsFree Tax Filing For 2011Myfreetax ComHandr BlockIrs Ez Form OnlineAmend A 2011 Tax Return2012 State Tax FormWww Irs Gov EfileStudent Filing TaxesHow Do I File State TaxesDoes A Student Need To File Taxes2011 State Tax FormsWww Taxes Hrblock ComFree Irs ExtensionTurbotax 2005 Free DownloadH&r Block Key Code Free State Filing1040x 2010 FormFederal Income Tax FormsTax Breaks For UnemployedFill State Taxes FreeTax Act 2008Irs Tax FormsTax Return FormFree Tax Return CalculatorMyfreetaxes De ComFreefilefillableforms Com1040 Ez 2011E-file State And Federal Taxes For FreeAmend Your TaxesTax Amendment FormsFill Out 1040xHow To Amend Federal Tax ReturnFillable Form 1040x2012taxesIrs Income Tax Forms 2010Free Online 1040ez FilingForms For 2012 Income Tax1040ez Booklet2008 Amended Tax Return Instructions

Amend Taxes

Amend taxes Publication 519 - Additional Material Table of Contents Appendix A—Tax Treaty Exemption Procedure for StudentsBelgium Bulgaria China, People's Republic of Cyprus Czech Republic, Estonia, Latvia, Lithuania, and Slovak Republic Egypt France Germany Iceland Indonesia Israel, Philippines and Thailand Korea, Norway, Poland, and Romania Morocco Netherlands Pakistan Portugal and Spain Slovenia and Venezuela Trinidad and Tobago Tunisia Appendix B—Tax Treaty Exemption Procedure for Teachers and ResearchersBelgium Bulgaria China, People's Republic of Commonwealth of Independent States Czech Republic and Slovak Republic Egypt, Hungary, Korea, Philippines, Poland, and Romania France Germany Greece India Indonesia Israel Italy Jamaica Luxembourg Netherlands Norway Pakistan Portugal Slovenia and Venezuela Thailand Trinidad and Tobago United Kingdom Frequently Asked Questions This section answers tax-related questions commonly asked by aliens. Amend taxes . Amend taxes What is the difference between a resident alien and a nonresident alien for tax purposes? . Amend taxes What is the difference between the taxation of income that is effectively connected with a trade or business in the United States and income that is not effectively connected with a trade or business in the United States? . Amend taxes I am a student with an F-1 Visa. Amend taxes I was told that I was an exempt individual. Amend taxes Does this mean I am exempt from paying U. Amend taxes S. Amend taxes tax? . Amend taxes I am a resident alien. Amend taxes Can I claim any treaty benefits? . Amend taxes I am a nonresident alien with no dependents. Amend taxes I am working temporarily for a U. Amend taxes S. Amend taxes company. Amend taxes What return do I file? . Amend taxes I came to the United States on June 30th of last year. Amend taxes I have an H-1B Visa. Amend taxes What is my tax status, resident alien or nonresident alien? What tax return do I file? . Amend taxes When is my Form 1040NR due? . Amend taxes My spouse is a nonresident alien. Amend taxes Does he need a social security number? . Amend taxes I am a nonresident alien. Amend taxes Can I file a joint return with my spouse? . Amend taxes I have an H-1B Visa and my husband has an F-1 Visa. Amend taxes We both lived in the United States all of last year and had income. Amend taxes What kind of form should we file? Do we file separate returns or a joint return? . Amend taxes Is a dual-resident taxpayer the same as a dual-status taxpayer? . Amend taxes I am a nonresident alien and invested money in the U. Amend taxes S. Amend taxes stock market through a U. Amend taxes S. Amend taxes brokerage company. Amend taxes Are the dividends and the capital gains taxable? If yes, how are they taxed? . Amend taxes I am a nonresident alien. Amend taxes I receive U. Amend taxes S. Amend taxes social security benefits. Amend taxes Are my benefits taxable? . Amend taxes Do I have to pay taxes on my scholarship? . Amend taxes I am a nonresident alien. Amend taxes Can I claim the standard deduction? . Amend taxes I am a dual-status taxpayer. Amend taxes Can I claim the standard deduction? . Amend taxes I am filing Form 1040NR. Amend taxes Can I claim itemized deductions? . Amend taxes I am not a U. Amend taxes S. Amend taxes citizen. Amend taxes What exemptions can I claim? . Amend taxes What exemptions can I claim as a dual-status taxpayer? . Amend taxes I am single with a dependent child. Amend taxes I was a dual-status alien in 2013. Amend taxes Can I claim the earned income credit on my 2013 tax return? . Amend taxes I am a nonresident alien student. Amend taxes Can I claim an education credit on my Form 1040NR? . Amend taxes I am a nonresident alien, temporarily working in the U. Amend taxes S. Amend taxes under a J visa. Amend taxes Am I subject to social security and Medicare taxes? . Amend taxes I am a nonresident alien student. Amend taxes Social security taxes were withheld from my pay in error. Amend taxes How do I get a refund of these taxes? . Amend taxes I am an alien who will be leaving the United States. Amend taxes What forms do I have to file before I leave? . Amend taxes I filed a Form 1040-C when I left the United States. Amend taxes Do I still have to file an annual U. Amend taxes S. Amend taxes tax return? . Amend taxes What is the difference between a resident alien and a nonresident alien for tax purposes? For tax purposes, an alien is an individual who is not a U. Amend taxes S. Amend taxes citizen. Amend taxes Aliens are classified as resident aliens and nonresident aliens. Amend taxes Resident aliens are taxed on their worldwide income, the same as U. Amend taxes S. Amend taxes citizens. Amend taxes Nonresident aliens are taxed only on their U. Amend taxes S. Amend taxes source income and certain foreign source income that is effectively connected with a U. Amend taxes S. Amend taxes trade or business. Amend taxes The difference between these two categories is that effectively connected income, after allowable deductions, is taxed at graduated rates. Amend taxes These are the same rates that apply to U. Amend taxes S. Amend taxes citizens and residents. Amend taxes Income that is not effectively connected is taxed at a flat 30% (or lower treaty) rate. Amend taxes The term “exempt individual” does not refer to someone exempt from U. Amend taxes S. Amend taxes tax. Amend taxes You were referred to as an exempt individual because as a student temporarily in the United States on an F Visa, you do not have to count the days you were present in the United States as a student during the first 5 years in determining if you are a resident alien under the substantial presence test. Amend taxes See chapter 1 . Amend taxes Generally, you cannot claim tax treaty benefits as a resident alien. Amend taxes However, there are exceptions. Amend taxes See Effect of Tax Treaties in chapter 1. Amend taxes See also Resident Aliens under Some Typical Tax Treaty Benefits in chapter 9. Amend taxes You must file Form 1040NR if you are engaged in a trade or business in the United States, or have any other U. Amend taxes S. Amend taxes source income on which tax was not fully paid by the amount withheld. Amend taxes You can use Form 1040NR-EZ instead of Form 1040NR if you meet all 11 conditions listed under Form 1040NR-EZ in chapter 7. Amend taxes You were a dual-status alien last year. Amend taxes As a general rule, because you were in the United States for 183 days or more, you have met the substantial presence test and you are taxed as a resident. Amend taxes However, for the part of the year that you were not present in the United States, you are a nonresident. Amend taxes File Form 1040. Amend taxes Print “Dual-Status Return” across the top. Amend taxes Attach a statement showing your U. Amend taxes S. Amend taxes source income for the part of the year you were a nonresident. Amend taxes You may use Form 1040NR as the statement. Amend taxes Print “Dual-Status Statement” across the top. Amend taxes See First Year of Residency in chapter 1 for rules on determining your residency starting date. Amend taxes If you are an employee and you receive wages subject to U. Amend taxes S. Amend taxes income tax withholding, you must generally file by the 15th day of the 4th month after your tax year ends. Amend taxes If you file for the 2013 calendar year, your return is due April 15, 2014. Amend taxes If you are not an employee who receives wages subject to U. Amend taxes S. Amend taxes income tax withholding, you must file by the 15th day of the 6th month after your tax year ends. Amend taxes For the 2013 calendar year, file your return by June 16, 2014. Amend taxes For more information on when and where to file, see chapter 7 . Amend taxes A social security number (SSN) must be furnished on returns, statements, and other tax-related documents. Amend taxes If your spouse does not have and is not eligible to get an SSN, he must apply for an individual taxpayer identification number (ITIN). Amend taxes If you are a U. Amend taxes S. Amend taxes citizen or resident and you choose to treat your nonresident spouse as a resident and file a joint tax return, your nonresident spouse needs an SSN or an ITIN. Amend taxes Alien spouses who are claimed as exemptions or dependents are also required to furnish an SSN or an ITIN. Amend taxes See Identification Number in chapter 5 for more information. Amend taxes Generally, you cannot file as married filing jointly if either spouse was a nonresident alien at any time during the tax year. Amend taxes However, nonresident aliens married to U. Amend taxes S. Amend taxes citizens or residents can choose to be treated as U. Amend taxes S. Amend taxes residents and file joint returns. Amend taxes For more information on this choice, see Nonresident Spouse Treated as a Resident in chapter 1. Amend taxes Assuming both of you had these visas for all of last year, you are a resident alien. Amend taxes Your husband is a nonresident alien if he has not been in the United States as a student for more than 5 years. Amend taxes You and your husband can file a joint tax return on Form 1040, 1040A, or 1040EZ if he makes the choice to be treated as a resident for the entire year. Amend taxes See Nonresident Spouse Treated as a Resident in chapter 1. Amend taxes If your husband does not make this choice, you must file a separate return on Form 1040 or Form 1040A. Amend taxes Your husband must file Form 1040NR or 1040NR-EZ. Amend taxes No. Amend taxes A dual-resident taxpayer is one who is a resident of both the United States and another country under each country's tax laws. Amend taxes See Effect of Tax Treaties in chapter 1. Amend taxes You are a dual-status taxpayer when you are both a resident alien and a nonresident alien in the same year. Amend taxes See chapter 6 . Amend taxes The following rules apply if the dividends and capital gains are not effectively connected with a U. Amend taxes S. Amend taxes trade or business. Amend taxes Capital gains are generally not taxable if you were in the United States for less than 183 days during the year. Amend taxes See Sales or Exchanges of Capital Assets in chapter 4 for more information and exceptions. Amend taxes Dividends are generally taxed at a 30% (or lower treaty) rate. Amend taxes The brokerage company or payor of the dividends should withhold this tax at source. Amend taxes If tax is not withheld at the correct rate, you must file Form 1040NR to receive a refund or pay any additional tax due. Amend taxes If the capital gains and dividends are effectively connected with a U. Amend taxes S. Amend taxes trade or business, they are taxed according to the same rules and at the same rates that apply to U. Amend taxes S. Amend taxes citizens and residents. Amend taxes If you are a nonresident alien, 85% of any U. Amend taxes S. Amend taxes social security benefits (and the equivalent portion of tier 1 railroad retirement benefits) you receive is subject to the flat 30% tax, unless exempt, or subject to a lower treaty rate. Amend taxes See The 30% Tax in chapter 4. Amend taxes If you are a nonresident alien and the scholarship is not from U. Amend taxes S. Amend taxes sources, it is not subject to U. Amend taxes S. Amend taxes tax. Amend taxes See Scholarships, Grants, Prizes, and Awards in chapter 2 to determine whether your scholarship is from U. Amend taxes S. Amend taxes sources. Amend taxes If your scholarship is from U. Amend taxes S. Amend taxes sources or you are a resident alien, your scholarship is subject to U. Amend taxes S. Amend taxes tax according to the following rules. Amend taxes If you are a candidate for a degree, you may be able to exclude from your income the part of the scholarship you use to pay for tuition, fees, books, supplies, and equipment required by the educational institution. Amend taxes However, the part of the scholarship you use to pay for other expenses, such as room and board, is taxable. Amend taxes See Scholarships and Fellowship Grants in chapter 3 for more information. Amend taxes If you are not a candidate for a degree, your scholarship is taxable. Amend taxes Nonresident aliens cannot claim the standard deduction. Amend taxes However, see Students and business apprentices from India , under Itemized Deductions in chapter 5 for an exception. Amend taxes You cannot claim the standard deduction allowed on Form 1040. Amend taxes However, you can itemize any allowable deductions. Amend taxes Nonresident aliens can claim some of the same itemized deductions that resident aliens can claim. Amend taxes However, nonresident aliens can claim itemized deductions only if they have income effectively connected with their U. Amend taxes S. Amend taxes trade or business. Amend taxes See Itemized Deductions in chapter 5. Amend taxes Resident aliens can claim personal exemptions and exemptions for dependents in the same way as U. Amend taxes S. Amend taxes citizens. Amend taxes However, nonresident aliens generally can claim only a personal exemption for themselves on their U. Amend taxes S. Amend taxes tax return. Amend taxes There are special rules for residents of Mexico, Canada, and South Korea; for U. Amend taxes S. Amend taxes nationals; and for students and business apprentices from India. Amend taxes See Exemptions in chapter 5. Amend taxes As a dual-status taxpayer, you usually will be able to claim your own personal exemption. Amend taxes Subject to the general rules for qualification, you can claim exemptions for your spouse and dependents when you figure taxable income for the part of the year you are a resident alien. Amend taxes The amount you can claim for these exemptions is limited to your taxable income (figured before subtracting exemptions) for the part of the year you are a resident alien. Amend taxes You cannot use exemptions (other than your own) to reduce taxable income to less than zero for that period. Amend taxes If you are a nonresident alien for any part of the year, you cannot claim the earned income credit. Amend taxes See chapter 6 for more information on dual-status aliens. Amend taxes If you are a nonresident alien for any part of the year, you generally cannot claim the education credits. Amend taxes However, if you are married and choose to file a joint return with a U. Amend taxes S. Amend taxes citizen or resident spouse, you may be eligible for these credits. Amend taxes See Nonresident Spouse Treated as a Resident in chapter 1. Amend taxes Generally, services you perform as a nonresident alien temporarily in the United States as a nonimmigrant under subparagraph (F), (J), (M), or (Q) of section 101(a)(15) of the Immigration and Nationality Act are not covered under the social security program if you perform the services to carry out the purpose for which you were admitted to the United States. Amend taxes See Social Security and Medicare Taxes in chapter 8. Amend taxes If social security or Medicare taxes were withheld in error from pay that is not subject to these taxes, contact the employer who withheld the taxes for a refund. Amend taxes If you are unable to get a full refund of the amount from your employer, file a claim for refund with the Internal Revenue Service on Form 843, Claim for Refund and Request for Abatement. Amend taxes Do not use Form 843 to request a refund of Additional Medicare Tax. Amend taxes See Refund of Taxes Withheld in Error in chapter 8. Amend taxes Before leaving the United States, aliens generally must obtain a certificate of compliance. Amend taxes This document, also popularly known as the sailing permit or departure permit, is part of the income tax form you must file before leaving. Amend taxes You will receive a sailing or departure permit after filing a Form 1040-C or Form 2063. Amend taxes These forms are discussed in chapter 11. Amend taxes Form 1040-C is not an annual U. Amend taxes S. Amend taxes income tax return. Amend taxes If an income tax return is required by law, you must file that return even though you already filed a Form 1040-C. Amend taxes Chapters 5 and 7 discuss filing an annual U. Amend taxes S. Amend taxes income tax return. Amend taxes . Amend taxes What is the difference between the taxation of income that is effectively connected with a trade or business in the United States and income that is not effectively connected with a trade or business in the United States? The difference between these two categories is that effectively connected income, after allowable deductions, is taxed at graduated rates. Amend taxes These are the same rates that apply to U. Amend taxes S. Amend taxes citizens and residents. Amend taxes Income that is not effectively connected is taxed at a flat 30% (or lower treaty) rate. Amend taxes The term “exempt individual” does not refer to someone exempt from U. Amend taxes S. Amend taxes tax. Amend taxes You were referred to as an exempt individual because as a student temporarily in the United States on an F Visa, you do not have to count the days you were present in the United States as a student during the first 5 years in determining if you are a resident alien under the substantial presence test. Amend taxes See chapter 1 . Amend taxes Generally, you cannot claim tax treaty benefits as a resident alien. Amend taxes However, there are exceptions. Amend taxes See Effect of Tax Treaties in chapter 1. Amend taxes See also Resident Aliens under Some Typical Tax Treaty Benefits in chapter 9. Amend taxes You must file Form 1040NR if you are engaged in a trade or business in the United States, or have any other U. Amend taxes S. Amend taxes source income on which tax was not fully paid by the amount withheld. Amend taxes You can use Form 1040NR-EZ instead of Form 1040NR if you meet all 11 conditions listed under Form 1040NR-EZ in chapter 7. Amend taxes You were a dual-status alien last year. Amend taxes As a general rule, because you were in the United States for 183 days or more, you have met the substantial presence test and you are taxed as a resident. Amend taxes However, for the part of the year that you were not present in the United States, you are a nonresident. Amend taxes File Form 1040. Amend taxes Print “Dual-Status Return” across the top. Amend taxes Attach a statement showing your U. Amend taxes S. Amend taxes source income for the part of the year you were a nonresident. Amend taxes You may use Form 1040NR as the statement. Amend taxes Print “Dual-Status Statement” across the top. Amend taxes See First Year of Residency in chapter 1 for rules on determining your residency starting date. Amend taxes If you are an employee and you receive wages subject to U. Amend taxes S. Amend taxes income tax withholding, you must generally file by the 15th day of the 4th month after your tax year ends. Amend taxes If you file for the 2013 calendar year, your return is due April 15, 2014. Amend taxes If you are not an employee who receives wages subject to U. Amend taxes S. Amend taxes income tax withholding, you must file by the 15th day of the 6th month after your tax year ends. Amend taxes For the 2013 calendar year, file your return by June 16, 2014. Amend taxes For more information on when and where to file, see chapter 7 . Amend taxes A social security number (SSN) must be furnished on returns, statements, and other tax-related documents. Amend taxes If your spouse does not have and is not eligible to get an SSN, he must apply for an individual taxpayer identification number (ITIN). Amend taxes If you are a U. Amend taxes S. Amend taxes citizen or resident and you choose to treat your nonresident spouse as a resident and file a joint tax return, your nonresident spouse needs an SSN or an ITIN. Amend taxes Alien spouses who are claimed as exemptions or dependents are also required to furnish an SSN or an ITIN. Amend taxes See Identification Number in chapter 5 for more information. Amend taxes Generally, you cannot file as married filing jointly if either spouse was a nonresident alien at any time during the tax year. Amend taxes However, nonresident aliens married to U. Amend taxes S. Amend taxes citizens or residents can choose to be treated as U. Amend taxes S. Amend taxes residents and file joint returns. Amend taxes For more information on this choice, see Nonresident Spouse Treated as a Resident in chapter 1. Amend taxes Assuming both of you had these visas for all of last year, you are a resident alien. Amend taxes Your husband is a nonresident alien if he has not been in the United States as a student for more than 5 years. Amend taxes You and your husband can file a joint tax return on Form 1040, 1040A, or 1040EZ if he makes the choice to be treated as a resident for the entire year. Amend taxes See Nonresident Spouse Treated as a Resident in chapter 1. Amend taxes If your husband does not make this choice, you must file a separate return on Form 1040 or Form 1040A. Amend taxes Your husband must file Form 1040NR or 1040NR-EZ. Amend taxes No. Amend taxes A dual-resident taxpayer is one who is a resident of both the United States and another country under each country's tax laws. Amend taxes See Effect of Tax Treaties in chapter 1. Amend taxes You are a dual-status taxpayer when you are both a resident alien and a nonresident alien in the same year. Amend taxes See chapter 6 . Amend taxes The following rules apply if the dividends and capital gains are not effectively connected with a U. Amend taxes S. Amend taxes trade or business. Amend taxes Capital gains are generally not taxable if you were in the United States for less than 183 days during the year. Amend taxes See Sales or Exchanges of Capital Assets in chapter 4 for more information and exceptions. Amend taxes Dividends are generally taxed at a 30% (or lower treaty) rate. Amend taxes The brokerage company or payor of the dividends should withhold this tax at source. Amend taxes If tax is not withheld at the correct rate, you must file Form 1040NR to receive a refund or pay any additional tax due. Amend taxes If the capital gains and dividends are effectively connected with a U. Amend taxes S. Amend taxes trade or business, they are taxed according to the same rules and at the same rates that apply to U. Amend taxes S. Amend taxes citizens and residents. Amend taxes If you are a nonresident alien, 85% of any U. Amend taxes S. Amend taxes social security benefits (and the equivalent portion of tier 1 railroad retirement benefits) you receive is subject to the flat 30% tax, unless exempt, or subject to a lower treaty rate. Amend taxes See The 30% Tax in chapter 4. Amend taxes If you are a nonresident alien and the scholarship is not from U. Amend taxes S. Amend taxes sources, it is not subject to U. Amend taxes S. Amend taxes tax. Amend taxes See Scholarships, Grants, Prizes, and Awards in chapter 2 to determine whether your scholarship is from U. Amend taxes S. Amend taxes sources. Amend taxes If your scholarship is from U. Amend taxes S. Amend taxes sources or you are a resident alien, your scholarship is subject to U. Amend taxes S. Amend taxes tax according to the following rules. Amend taxes If you are a candidate for a degree, you may be able to exclude from your income the part of the scholarship you use to pay for tuition, fees, books, supplies, and equipment required by the educational institution. Amend taxes However, the part of the scholarship you use to pay for other expenses, such as room and board, is taxable. Amend taxes See Scholarships and Fellowship Grants in chapter 3 for more information. Amend taxes If you are not a candidate for a degree, your scholarship is taxable. Amend taxes Nonresident aliens cannot claim the standard deduction. Amend taxes However, see Students and business apprentices from India , under Itemized Deductions in chapter 5 for an exception. Amend taxes You cannot claim the standard deduction allowed on Form 1040. Amend taxes However, you can itemize any allowable deductions. Amend taxes Nonresident aliens can claim some of the same itemized deductions that resident aliens can claim. Amend taxes However, nonresident aliens can claim itemized deductions only if they have income effectively connected with their U. Amend taxes S. Amend taxes trade or business. Amend taxes See Itemized Deductions in chapter 5. Amend taxes Resident aliens can claim personal exemptions and exemptions for dependents in the same way as U. Amend taxes S. Amend taxes citizens. Amend taxes However, nonresident aliens generally can claim only a personal exemption for themselves on their U. Amend taxes S. Amend taxes tax return. Amend taxes There are special rules for residents of Mexico, Canada, and South Korea; for U. Amend taxes S. Amend taxes nationals; and for students and business apprentices from India. Amend taxes See Exemptions in chapter 5. Amend taxes As a dual-status taxpayer, you usually will be able to claim your own personal exemption. Amend taxes Subject to the general rules for qualification, you can claim exemptions for your spouse and dependents when you figure taxable income for the part of the year you are a resident alien. Amend taxes The amount you can claim for these exemptions is limited to your taxable income (figured before subtracting exemptions) for the part of the year you are a resident alien. Amend taxes You cannot use exemptions (other than your own) to reduce taxable income to less than zero for that period. Amend taxes If you are a nonresident alien for any part of the year, you cannot claim the earned income credit. Amend taxes See chapter 6 for more information on dual-status aliens. Amend taxes If you are a nonresident alien for any part of the year, you generally cannot claim the education credits. Amend taxes However, if you are married and choose to file a joint return with a U. Amend taxes S. Amend taxes citizen or resident spouse, you may be eligible for these credits. Amend taxes See Nonresident Spouse Treated as a Resident in chapter 1. Amend taxes Generally, services you perform as a nonresident alien temporarily in the United States as a nonimmigrant under subparagraph (F), (J), (M), or (Q) of section 101(a)(15) of the Immigration and Nationality Act are not covered under the social security program if you perform the services to carry out the purpose for which you were admitted to the United States. Amend taxes See Social Security and Medicare Taxes in chapter 8. Amend taxes If social security or Medicare taxes were withheld in error from pay that is not subject to these taxes, contact the employer who withheld the taxes for a refund. Amend taxes If you are unable to get a full refund of the amount from your employer, file a claim for refund with the Internal Revenue Service on Form 843, Claim for Refund and Request for Abatement. Amend taxes Do not use Form 843 to request a refund of Additional Medicare Tax. Amend taxes See Refund of Taxes Withheld in Error in chapter 8. Amend taxes Before leaving the United States, aliens generally must obtain a certificate of compliance. Amend taxes This document, also popularly known as the sailing permit or departure permit, is part of the income tax form you must file before leaving. Amend taxes You will receive a sailing or departure permit after filing a Form 1040-C or Form 2063. Amend taxes These forms are discussed in chapter 11. Amend taxes Form 1040-C is not an annual U. Amend taxes S. Amend taxes income tax return. Amend taxes If an income tax return is required by law, you must file that return even though you already filed a Form 1040-C. Amend taxes Chapters 5 and 7 discuss filing an annual U. Amend taxes S. Amend taxes income tax return. Amend taxes . Amend taxes I am a student with an F-1 Visa. Amend taxes I was told that I was an exempt individual. Amend taxes Does this mean I am exempt from paying U. Amend taxes S. Amend taxes tax? The term “exempt individual” does not refer to someone exempt from U. Amend taxes S. Amend taxes tax. Amend taxes You were referred to as an exempt individual because as a student temporarily in the United States on an F Visa, you do not have to count the days you were present in the United States as a student during the first 5 years in determining if you are a resident alien under the substantial presence test. Amend taxes See chapter 1 . Amend taxes Generally, you cannot claim tax treaty benefits as a resident alien. Amend taxes However, there are exceptions. Amend taxes See Effect of Tax Treaties in chapter 1. Amend taxes See also Resident Aliens under Some Typical Tax Treaty Benefits in chapter 9. Amend taxes You must file Form 1040NR if you are engaged in a trade or business in the United States, or have any other U. Amend taxes S. Amend taxes source income on which tax was not fully paid by the amount withheld. Amend taxes You can use Form 1040NR-EZ instead of Form 1040NR if you meet all 11 conditions listed under Form 1040NR-EZ in chapter 7. Amend taxes You were a dual-status alien last year. Amend taxes As a general rule, because you were in the United States for 183 days or more, you have met the substantial presence test and you are taxed as a resident. Amend taxes However, for the part of the year that you were not present in the United States, you are a nonresident. Amend taxes File Form 1040. Amend taxes Print “Dual-Status Return” across the top. Amend taxes Attach a statement showing your U. Amend taxes S. Amend taxes source income for the part of the year you were a nonresident. Amend taxes You may use Form 1040NR as the statement. Amend taxes Print “Dual-Status Statement” across the top. Amend taxes See First Year of Residency in chapter 1 for rules on determining your residency starting date. Amend taxes If you are an employee and you receive wages subject to U. Amend taxes S. Amend taxes income tax withholding, you must generally file by the 15th day of the 4th month after your tax year ends. Amend taxes If you file for the 2013 calendar year, your return is due April 15, 2014. Amend taxes If you are not an employee who receives wages subject to U. Amend taxes S. Amend taxes income tax withholding, you must file by the 15th day of the 6th month after your tax year ends. Amend taxes For the 2013 calendar year, file your return by June 16, 2014. Amend taxes For more information on when and where to file, see chapter 7 . Amend taxes A social security number (SSN) must be furnished on returns, statements, and other tax-related documents. Amend taxes If your spouse does not have and is not eligible to get an SSN, he must apply for an individual taxpayer identification number (ITIN). Amend taxes If you are a U. Amend taxes S. Amend taxes citizen or resident and you choose to treat your nonresident spouse as a resident and file a joint tax return, your nonresident spouse needs an SSN or an ITIN. Amend taxes Alien spouses who are claimed as exemptions or dependents are also required to furnish an SSN or an ITIN. Amend taxes See Identification Number in chapter 5 for more information. Amend taxes Generally, you cannot file as married filing jointly if either spouse was a nonresident alien at any time during the tax year. Amend taxes However, nonresident aliens married to U. Amend taxes S. Amend taxes citizens or residents can choose to be treated as U. Amend taxes S. Amend taxes residents and file joint returns. Amend taxes For more information on this choice, see Nonresident Spouse Treated as a Resident in chapter 1. Amend taxes Assuming both of you had these visas for all of last year, you are a resident alien. Amend taxes Your husband is a nonresident alien if he has not been in the United States as a student for more than 5 years. Amend taxes You and your husband can file a joint tax return on Form 1040, 1040A, or 1040EZ if he makes the choice to be treated as a resident for the entire year. Amend taxes See Nonresident Spouse Treated as a Resident in chapter 1. Amend taxes If your husband does not make this choice, you must file a separate return on Form 1040 or Form 1040A. Amend taxes Your husband must file Form 1040NR or 1040NR-EZ. Amend taxes No. Amend taxes A dual-resident taxpayer is one who is a resident of both the United States and another country under each country's tax laws. Amend taxes See Effect of Tax Treaties in chapter 1. Amend taxes You are a dual-status taxpayer when you are both a resident alien and a nonresident alien in the same year. Amend taxes See chapter 6 . Amend taxes The following rules apply if the dividends and capital gains are not effectively connected with a U. Amend taxes S. Amend taxes trade or business. Amend taxes Capital gains are generally not taxable if you were in the United States for less than 183 days during the year. Amend taxes See Sales or Exchanges of Capital Assets in chapter 4 for more information and exceptions. Amend taxes Dividends are generally taxed at a 30% (or lower treaty) rate. Amend taxes The brokerage company or payor of the dividends should withhold this tax at source. Amend taxes If tax is not withheld at the correct rate, you must file Form 1040NR to receive a refund or pay any additional tax due. Amend taxes If the capital gains and dividends are effectively connected with a U. Amend taxes S. Amend taxes trade or business, they are taxed according to the same rules and at the same rates that apply to U. Amend taxes S. Amend taxes citizens and residents. Amend taxes If you are a nonresident alien, 85% of any U. Amend taxes S. Amend taxes social security benefits (and the equivalent portion of tier 1 railroad retirement benefits) you receive is subject to the flat 30% tax, unless exempt, or subject to a lower treaty rate. Amend taxes See The 30% Tax in chapter 4. Amend taxes If you are a nonresident alien and the scholarship is not from U. Amend taxes S. Amend taxes sources, it is not subject to U. Amend taxes S. Amend taxes tax. Amend taxes See Scholarships, Grants, Prizes, and Awards in chapter 2 to determine whether your scholarship is from U. Amend taxes S. Amend taxes sources. Amend taxes If your scholarship is from U. Amend taxes S. Amend taxes sources or you are a resident alien, your scholarship is subject to U. Amend taxes S. Amend taxes tax according to the following rules. Amend taxes If you are a candidate for a degree, you may be able to exclude from your income the part of the scholarship you use to pay for tuition, fees, books, supplies, and equipment required by the educational institution. Amend taxes However, the part of the scholarship you use to pay for other expenses, such as room and board, is taxable. Amend taxes See Scholarships and Fellowship Grants in chapter 3 for more information. Amend taxes If you are not a candidate for a degree, your scholarship is taxable. Amend taxes Nonresident aliens cannot claim the standard deduction. Amend taxes However, see Students and business apprentices from India , under Itemized Deductions in chapter 5 for an exception. Amend taxes You cannot claim the standard deduction allowed on Form 1040. Amend taxes However, you can itemize any allowable deductions. Amend taxes Nonresident aliens can claim some of the same itemized deductions that resident aliens can claim. Amend taxes However, nonresident aliens can claim itemized deductions only if they have income effectively connected with their U. Amend taxes S. Amend taxes trade or business. Amend taxes See Itemized Deductions in chapter 5. Amend taxes Resident aliens can claim personal exemptions and exemptions for dependents in the same way as U. Amend taxes S. Amend taxes citizens. Amend taxes However, nonresident aliens generally can claim only a personal exemption for themselves on their U. Amend taxes S. Amend taxes tax return. Amend taxes There are special rules for residents of Mexico, Canada, and South Korea; for U. Amend taxes S. Amend taxes nationals; and for students and business apprentices from India. Amend taxes See Exemptions in chapter 5. Amend taxes As a dual-status taxpayer, you usually will be able to claim your own personal exemption. Amend taxes Subject to the general rules for qualification, you can claim exemptions for your spouse and dependents when you figure taxable income for the part of the year you are a resident alien. Amend taxes The amount you can claim for these exemptions is limited to your taxable income (figured before subtracting exemptions) for the part of the year you are a resident alien. Amend taxes You cannot use exemptions (other than your own) to reduce taxable income to less than zero for that period. Amend taxes If you are a nonresident alien for any part of the year, you cannot claim the earned income credit. Amend taxes See chapter 6 for more information on dual-status aliens. Amend taxes If you are a nonresident alien for any part of the year, you generally cannot claim the education credits. Amend taxes However, if you are married and choose to file a joint return with a U. Amend taxes S. Amend taxes citizen or resident spouse, you may be eligible for these credits. Amend taxes See Nonresident Spouse Treated as a Resident in chapter 1. Amend taxes Generally, services you perform as a nonresident alien temporarily in the United States as a nonimmigrant under subparagraph (F), (J), (M), or (Q) of section 101(a)(15) of the Immigration and Nationality Act are not covered under the social security program if you perform the services to carry out the purpose for which you were admitted to the United States. Amend taxes See Social Security and Medicare Taxes in chapter 8. Amend taxes If social security or Medicare taxes were withheld in error from pay that is not subject to these taxes, contact the employer who withheld the taxes for a refund. Amend taxes If you are unable to get a full refund of the amount from your employer, file a claim for refund with the Internal Revenue Service on Form 843, Claim for Refund and Request for Abatement. Amend taxes Do not use Form 843 to request a refund of Additional Medicare Tax. Amend taxes See Refund of Taxes Withheld in Error in chapter 8. Amend taxes Before leaving the United States, aliens generally must obtain a certificate of compliance. Amend taxes This document, also popularly known as the sailing permit or departure permit, is part of the income tax form you must file before leaving. Amend taxes You will receive a sailing or departure permit after filing a Form 1040-C or Form 2063. Amend taxes These forms are discussed in chapter 11. Amend taxes Form 1040-C is not an annual U. Amend taxes S. Amend taxes income tax return. Amend taxes If an income tax return is required by law, you must file that return even though you already filed a Form 1040-C. Amend taxes Chapters 5 and 7 discuss filing an annual U. Amend taxes S. Amend taxes income tax return. Amend taxes . Amend taxes I am a resident alien. Amend taxes Can I claim any treaty benefits? Generally, you cannot claim tax treaty benefits as a resident alien. Amend taxes However, there are exceptions. Amend taxes See Effect of Tax Treaties in chapter 1. Amend taxes See also Resident Aliens under Some Typical Tax Treaty Benefits in chapter 9. Amend taxes You must file Form 1040NR if you are engaged in a trade or business in the United States, or have any other U. Amend taxes S. Amend taxes source income on which tax was not fully paid by the amount withheld. Amend taxes You can use Form 1040NR-EZ instead of Form 1040NR if you meet all 11 conditions listed under Form 1040NR-EZ in chapter 7. Amend taxes You were a dual-status alien last year. Amend taxes As a general rule, because you were in the United States for 183 days or more, you have met the substantial presence test and you are taxed as a resident. Amend taxes However, for the part of the year that you were not present in the United States, you are a nonresident. Amend taxes File Form 1040. Amend taxes Print “Dual-Status Return” across the top. Amend taxes Attach a statement showing your U. Amend taxes S. Amend taxes source income for the part of the year you were a nonresident. Amend taxes You may use Form 1040NR as the statement. Amend taxes Print “Dual-Status Statement” across the top. Amend taxes See First Year of Residency in chapter 1 for rules on determining your residency starting date. Amend taxes If you are an employee and you receive wages subject to U. Amend taxes S. Amend taxes income tax withholding, you must generally file by the 15th day of the 4th month after your tax year ends. Amend taxes If you file for the 2013 calendar year, your return is due April 15, 2014. Amend taxes If you are not an employee who receives wages subject to U. Amend taxes S. Amend taxes income tax withholding, you must file by the 15th day of the 6th month after your tax year ends. Amend taxes For the 2013 calendar year, file your return by June 16, 2014. Amend taxes For more information on when and where to file, see chapter 7 . Amend taxes A social security number (SSN) must be furnished on returns, statements, and other tax-related documents. Amend taxes If your spouse does not have and is not eligible to get an SSN, he must apply for an individual taxpayer identification number (ITIN). Amend taxes If you are a U. Amend taxes S. Amend taxes citizen or resident and you choose to treat your nonresident spouse as a resident and file a joint tax return, your nonresident spouse needs an SSN or an ITIN. Amend taxes Alien spouses who are claimed as exemptions or dependents are also required to furnish an SSN or an ITIN. Amend taxes See Identification Number in chapter 5 for more information. Amend taxes Generally, you cannot file as married filing jointly if either spouse was a nonresident alien at any time during the tax year. Amend taxes However, nonresident aliens married to U. Amend taxes S. Amend taxes citizens or residents can choose to be treated as U. Amend taxes S. Amend taxes residents and file joint returns. Amend taxes For more information on this choice, see Nonresident Spouse Treated as a Resident in chapter 1. Amend taxes Assuming both of you had these visas for all of last year, you are a resident alien. Amend taxes Your husband is a nonresident alien if he has not been in the United States as a student for more than 5 years. Amend taxes You and your husband can file a joint tax return on Form 1040, 1040A, or 1040EZ if he makes the choice to be treated as a resident for the entire year. Amend taxes See Nonresident Spouse Treated as a Resident in chapter 1. Amend taxes If your husband does not make this choice, you must file a separate return on Form 1040 or Form 1040A. Amend taxes Your husband must file Form 1040NR or 1040NR-EZ. Amend taxes No. Amend taxes A dual-resident taxpayer is one who is a resident of both the United States and another country under each country's tax laws. Amend taxes See Effect of Tax Treaties in chapter 1. Amend taxes You are a dual-status taxpayer when you are both a resident alien and a nonresident alien in the same year. Amend taxes See chapter 6 . Amend taxes The following rules apply if the dividends and capital gains are not effectively connected with a U. Amend taxes S. Amend taxes trade or business. Amend taxes Capital gains are generally not taxable if you were in the United States for less than 183 days during the year. Amend taxes See Sales or Exchanges of Capital Assets in chapter 4 for more information and exceptions. Amend taxes Dividends are generally taxed at a 30% (or lower treaty) rate. Amend taxes The brokerage company or payor of the dividends should withhold this tax at source. Amend taxes If tax is not withheld at the correct rate, you must file Form 1040NR to receive a refund or pay any additional tax due. Amend taxes If the capital gains and dividends are effectively connected with a U. Amend taxes S. Amend taxes trade or business, they are taxed according to the same rules and at the same rates that apply to U. Amend taxes S. Amend taxes citizens and residents. Amend taxes If you are a nonresident alien, 85% of any U. Amend taxes S. Amend taxes social security benefits (and the equivalent portion of tier 1 railroad retirement benefits) you receive is subject to the flat 30% tax, unless exempt, or subject to a lower treaty rate. Amend taxes See The 30% Tax in chapter 4. Amend taxes If you are a nonresident alien and the scholarship is not from U. Amend taxes S. Amend taxes sources, it is not subject to U. Amend taxes S. Amend taxes tax. Amend taxes See Scholarships, Grants, Prizes, and Awards in chapter 2 to determine whether your scholarship is from U. Amend taxes S. Amend taxes sources. Amend taxes If your scholarship is from U. Amend taxes S. Amend taxes sources or you are a resident alien, your scholarship is subject to U. Amend taxes S. Amend taxes tax according to the following rules. Amend taxes If you are a candidate for a degree, you may be able to exclude from your income the part of the scholarship you use to pay for tuition, fees, books, supplies, and equipment required by the educational institution. Amend taxes However, the part of the scholarship you use to pay for other expenses, such as room and board, is taxable. Amend taxes See Scholarships and Fellowship Grants in chapter 3 for more information. Amend taxes If you are not a candidate for a degree, your scholarship is taxable. Amend taxes Nonresident aliens cannot claim the standard deduction. Amend taxes However, see Students and business apprentices from India , under Itemized Deductions in chapter 5 for an exception. Amend taxes You cannot claim the standard deduction allowed on Form 1040. Amend taxes However, you can itemize any allowable deductions. Amend taxes Nonresident aliens can claim some of the same itemized deductions that resident aliens can claim. Amend taxes However, nonresident aliens can claim itemized deductions only if they have income effectively connected with their U. Amend taxes S. Amend taxes trade or business. Amend taxes See Itemized Deductions in chapter 5. Amend taxes Resident aliens can claim personal exemptions and exemptions for dependents in the same way as U. Amend taxes S. Amend taxes citizens. Amend taxes However, nonresident aliens generally can claim only a personal exemption for themselves on their U. Amend taxes S. Amend taxes tax return. Amend taxes There are special rules for residents of Mexico, Canada, and South Korea; for U. Amend taxes S. Amend taxes nationals; and for students and business apprentices from India. Amend taxes See Exemptions in chapter 5. Amend taxes As a dual-status taxpayer, you usually will be able to claim your own personal exemption. Amend taxes Subject to the general rules for qualification, you can claim exemptions for your spouse and dependents when you figure taxable income for the part of the year you are a resident alien. Amend taxes The amount you can claim for these exemptions is limited to your taxable income (figured before subtracting exemptions) for the part of the year you are a resident alien. Amend taxes You cannot use exemptions (other than your own) to reduce taxable income to less than zero for that period. Amend taxes If you are a nonresident alien for any part of the year, you cannot claim the earned income credit. Amend taxes See chapter 6 for more information on dual-status aliens. Amend taxes If you are a nonresident alien for any part of the year, you generally cannot claim the education credits. Amend taxes However, if you are married and choose to file a joint return with a U. Amend taxes S. Amend taxes citizen or resident spouse, you may be eligible for these credits. Amend taxes See Nonresident Spouse Treated as a Resident in chapter 1. Amend taxes Generally, services you perform as a nonresident alien temporarily in the United States as a nonimmigrant under subparagraph (F), (J), (M), or (Q) of section 101(a)(15) of the Immigration and Nationality Act are not covered under the social security program if you perform the services to carry out the purpose for which you were admitted to the United States. Amend taxes See Social Security and Medicare Taxes in chapter 8. Amend taxes If social security or Medicare taxes were withheld in error from pay that is not subject to these taxes, contact the employer who withheld the taxes for a refund. Amend taxes If you are unable to get a full refund of the amount from your employer, file a claim for refund with the Internal Revenue Service on Form 843, Claim for Refund and Request for Abatement. Amend taxes Do not use Form 843 to request a refund of Additional Medicare Tax. Amend taxes See Refund of Taxes Withheld in Error in chapter 8. Amend taxes Before leaving the United States, aliens generally must obtain a certificate of compliance. Amend taxes This document, also popularly known as the sailing permit or departure permit, is part of the income tax form you must file before leaving. Amend taxes You will receive a sailing or departure permit after filing a Form 1040-C or Form 2063. Amend taxes These forms are discussed in chapter 11. Amend taxes Form 1040-C is not an annual U. Amend taxes S. Amend taxes income tax return. Amend taxes If an income tax return is required by law, you must file that return even though you already filed a Form 1040-C. Amend taxes Chapters 5 and 7 discuss filing an annual U. Amend taxes S. Amend taxes income tax return. Amend taxes . Amend taxes I am a nonresident alien with no dependents. Amend taxes I am working temporarily for a U. Amend taxes S. Amend taxes company. Amend taxes What return do I file? You must file Form 1040NR if you are engaged in a trade or business in the United States, or have any other U. Amend taxes S. Amend taxes source income on which tax was not fully paid by the amount withheld. Amend taxes You can use Form 1040NR-EZ instead of Form 1040NR if you meet all 11 conditions listed under Form 1040NR-EZ in chapter 7. Amend taxes You were a dual-status alien last year. Amend taxes As a general rule, because you were in the United States for 183 days or more, you have met the substantial presence test and you are taxed as a resident. Amend taxes However, for the part of the year that you were not present in the United States, you are a nonresident. Amend taxes File Form 1040. Amend taxes Print “Dual-Status Return” across the top. Amend taxes Attach a statement showing your U. Amend taxes S. Amend taxes source income for the part of the year you were a nonresident. Amend taxes You may use Form 1040NR as the statement. Amend taxes Print “Dual-Status Statement” across the top. Amend taxes See First Year of Residency in chapter 1 for rules on determining your residency starting date. Amend taxes If you are an employee and you receive wages subject to U. Amend taxes S. Amend taxes income tax withholding, you must generally file by the 15th day of the 4th month after your tax year ends. Amend taxes If you file for the 2013 calendar year, your return is due April 15, 2014. Amend taxes If you are not an employee who receives wages subject to U. Amend taxes S. Amend taxes income tax withholding, you must file by the 15th day of the 6th month after your tax year ends. Amend taxes For the 2013 calendar year, file your return by June 16, 2014. Amend taxes For more information on when and where to file, see chapter 7 . Amend taxes A social security number (SSN) must be furnished on returns, statements, and other tax-related documents. Amend taxes If your spouse does not have and is not eligible to get an SSN, he must apply for an individual taxpayer identification number (ITIN). Amend taxes If you are a U. Amend taxes S. Amend taxes citizen or resident and you choose to treat your nonresident spouse as a resident and file a joint tax return, your nonresident spouse needs an SSN or an ITIN. Amend taxes Alien spouses who are claimed as exemptions or dependents are also required to furnish an SSN or an ITIN. Amend taxes See Identification Number in chapter 5 for more information. Amend taxes Generally, you cannot file as married filing jointly if either spouse was a nonresident alien at any time during the tax year. Amend taxes However, nonresident aliens married to U. Amend taxes S. Amend taxes citizens or residents can choose to be treated as U. Amend taxes S. Amend taxes residents and file joint returns. Amend taxes For more information on this choice, see Nonresident Spouse Treated as a Resident in chapter 1. Amend taxes Assuming both of you had these visas for all of last year, you are a resident alien. Amend taxes Your husband is a nonresident alien if he has not been in the United States as a student for more than 5 years. Amend taxes You and your husband can file a joint tax return on Form 1040, 1040A, or 1040EZ if he makes the choice to be treated as a resident for the entire year. Amend taxes See Nonresident Spouse Treated as a Resident in chapter 1. Amend taxes If your husband does not make this choice, you must file a separate return on Form 1040 or Form 1040A. Amend taxes Your husband must file Form 1040NR or 1040NR-EZ. Amend taxes No. Amend taxes A dual-resident taxpayer is one who is a resident of both the United States and another country under each country's tax laws. Amend taxes See Effect of Tax Treaties in chapter 1. Amend taxes You are a dual-status taxpayer when you are both a resident alien and a nonresident alien in the same year. Amend taxes See chapter 6 . Amend taxes The following rules apply if the dividends and capital gains are not effectively connected with a U. Amend taxes S. Amend taxes trade or business. Amend taxes Capital gains are generally not taxable if you were in the United States for less than 183 days during the year. Amend taxes See Sales or Exchanges of Capital Assets in chapter 4 for more information and exceptions. Amend taxes Dividends are generally taxed at a 30% (or lower treaty) rate. Amend taxes The brokerage company or payor of the dividends should withhold this tax at source. Amend taxes If tax is not withheld at the correct rate, you must file Form 1040NR to receive a refund or pay any additional tax due. Amend taxes If the capital gains and dividends are effectively connected with a U. Amend taxes S. Amend taxes trade or business, they are taxed according to the same rules and at the same rates that apply to U. Amend taxes S. Amend taxes citizens and residents. Amend taxes If you are a nonresident alien, 85% of any U. Amend taxes S. Amend taxes social security benefits (and the equivalent portion of tier 1 railroad retirement benefits) you receive is subject to the flat 30% tax, unless exempt, or subject to a lower treaty rate. Amend taxes See The 30% Tax in chapter 4. Amend taxes If you are a nonresident alien and the scholarship is not from U. Amend taxes S. Amend taxes sources, it is not subject to U. Amend taxes S. Amend taxes tax. Amend taxes See Scholarships, Grants, Prizes, and Awards in chapter 2 to determine whether your scholarship is from U. Amend taxes S. Amend taxes sources. Amend taxes If your scholarship is from U. Amend taxes S. Amend taxes sources or you are a resident alien, your scholarship is subject to U. Amend taxes S. Amend taxes tax according to the following rules. Amend taxes If you are a candidate for a degree, you may be able to exclude from your income the part of the scholarship you use to pay for tuition, fees, books, supplies, and equipment required by the educational institution. Amend taxes However, the part of the scholarship you use to pay for other expenses, such as room and board, is taxable. Amend taxes See Scholarships and Fellowship Grants in chapter 3 for more information. Amend taxes If you are not a candidate for a degree, your scholarship is taxable. Amend taxes Nonresident aliens cannot claim the standard deduction. Amend taxes However, see Students and business apprentices from India , under Itemized Deductions in chapter 5 for an exception. Amend taxes You cannot claim the standard deduction allowed on Form 1040. Amend taxes However, you can itemize any allowable deductions. Amend taxes Nonresident aliens can claim some of the same itemized deductions that resident aliens can claim. Amend taxes However, nonresident aliens can claim itemized deductions only if they have income effectively connected with their U. Amend taxes S. Amend taxes trade or business. Amend taxes See Itemized Deductions in chapter 5. Amend taxes Resident aliens can claim personal exemptions and exemptions for dependents in the same way as U. Amend taxes S. Amend taxes citizens. Amend taxes However, nonresident aliens generally can claim only a personal exemption for themselves on their U. Amend taxes S. Amend taxes tax return. Amend taxes There are special rules for residents of Mexico, Canada, and South Korea; for U. Amend taxes S. Amend taxes nationals; and for students and business apprentices from India. Amend taxes See Exemptions in chapter 5. Amend taxes As a dual-status taxpayer, you usually will be able to claim your own personal exemption. Amend taxes Subject to the general rules for qualification, you can claim exemptions for your spouse and dependents when you figure taxable income for the part of the year you are a resident alien. Amend taxes The amount you can claim for these exemptions is limited to your taxable income (figured before subtracting exemptions) for the part of the year you are a resident alien. Amend taxes You cannot use exemptions (other than your own) to reduce taxable income to less than zero for that period. Amend taxes If you are a nonresident alien for any part of the year, you cannot claim the earned income credit. Amend taxes See chapter 6 for more information on dual-status aliens. Amend taxes If you are a nonresident alien for any part of the year, you generally cannot claim the education credits. Amend taxes However, if you are married and choose to file a joint return with a U. Amend taxes S. Amend taxes citizen or resident spouse, you may be eligible for these credits. Amend taxes See Nonresident Spouse Treated as a Resident in chapter 1. Amend taxes Generally, services you perform as a nonresident alien temporarily in the United States as a nonimmigrant under subparagraph (F), (J), (M), or (Q) of section 101(a)(15) of the Immigration and Nationality Act are not covered under the social security program if you perform the services to carry out the purpose for which you were admitted to the United States. Amend taxes See Social Security and Medicare Taxes in chapter 8. Amend taxes If social security or Medicare taxes were withheld in error from pay that is not subject to these taxes, contact the employer who withheld the taxes for a refund. Amend taxes If you are unable to get a full refund of the amount from your employer, file a claim for refund with the Internal Revenue Service on Form 843, Claim for Refund and Request for Abatement. Amend taxes Do not use Form 843 to request a refund of Additional Medicare Tax. Amend taxes See Refund of Taxes Withheld in Error in chapter 8. Amend taxes Before leaving the United States, aliens generally must obtain a certificate of compliance. Amend taxes This document, also popularly known as the sailing permit or departure permit, is part of the income tax form you must file before leaving. Amend taxes You will receive a sailing or departure permit after filing a Form 1040-C or Form 2063. Amend taxes These forms are discussed in chapter 11. Amend taxes Form 1040-C is not an annual U. Amend taxes S. Amend taxes income tax return. Amend taxes If an income tax return is required by law, you must file that return even though you already filed a Form 1040-C. Amend taxes Chapters 5 and 7 discuss filing an annual U. Amend taxes S. Amend taxes income tax return. Amend taxes . Amend taxes I came to the United States on June 30th of last year. Amend taxes I have an H-1B Visa. Amend taxes What is my tax status, resident alien or nonresident alien? What tax return do I file? You were a dual-status alien last year. Amend taxes As a general rule, because you were in the United States for 183 days or more, you have met the substantial presence test and you are taxed as a resident. Amend taxes However, for the part of the year that you were not present in the United States, you are a nonresident. Amend taxes File Form 1040. Amend taxes Print “Dual-Status Return” across the top. Amend taxes Attach a statement showing your U. Amend taxes S. Amend taxes source income for the part of the year you were a nonresident. Amend taxes You may use Form 1040NR as the statement. Amend taxes Print “Dual-Status Statement” across the top. Amend taxes See First Year of Residency in chapter 1 for rules on determining your residency starting date. Amend taxes If you are an employee and you receive wages subject to U. Amend taxes S. Amend taxes income tax withholding, you must generally file by the 15th day of the 4th month after your tax year ends. Amend taxes If you file for the 2013 calendar year, your return is due April 15, 2014. Amend taxes If you are not an employee who receives wages subject to U. Amend taxes S. Amend taxes income tax withholding, you must file by the 15th day of the 6th month after your tax year ends. Amend taxes For the 2013 calendar year, file your return by June 16, 2014. Amend taxes For more information on when and where to file, see chapter 7 . Amend taxes A social security number (SSN) must be furnished on returns, statements, and other tax-related documents. Amend taxes If your spouse does not have and is not eligible to get an SSN, he must apply for an individual taxpayer identification number (ITIN). Amend taxes If you are a U. Amend taxes S. Amend taxes citizen or resident and you choose to treat your nonresident spouse as a resident and file a joint tax return, your nonresident spouse needs an SSN or an ITIN. Amend taxes Alien spouses who are claimed as exemptions or dependents are also required to furnish an SSN or an ITIN. Amend taxes See Identification Number in chapter 5 for more information. Amend taxes Generally, you cannot file as married filing jointly if either spouse was a nonresident alien at any time during the tax year. Amend taxes However, nonresident aliens married to U. Amend taxes S. Amend taxes citizens or residents can choose to be treated as U. Amend taxes S. Amend taxes residents and file joint returns. Amend taxes For more information on this choice, see Nonresident Spouse Treated as a Resident in chapter 1. Amend taxes Assuming both of you had these visas for all of last year, you are a resident alien. Amend taxes Your husband is a nonresident alien if he has not been in the United States as a student for more than 5 years. Amend taxes You and your husband can file a joint tax return on Form 1040, 1040A, or 1040EZ if he makes the choice to be treated as a resident for the entire year. Amend taxes See Nonresident Spouse Treated as a Resident in chapter 1. Amend taxes If your husband does not make this choice, you must file a separate return on Form 1040 or Form 1040A. Amend taxes Your husband must file Form 1040NR or 1040NR-EZ. Amend taxes No. Amend taxes A dual-resident taxpayer is one who is a resident of both the United States and another country under each country's tax laws. Amend taxes See Effect of Tax Treaties in chapter 1. Amend taxes You are a dual-status taxpayer when you are both a resident alien and a nonresident alien in the same year. Amend taxes See chapter 6 . Amend taxes The following rules apply if the dividends and capital gains are not effectively connected with a U. Amend taxes S. Amend taxes trade or business. Amend taxes Capital gains are generally not taxable if you were in the United States for less than 183 days during the year. Amend taxes See Sales or Exchanges of Capital Assets in chapter 4 for more information and exceptions. Amend taxes Dividends are generally taxed at a 30% (or lower treaty) rate. Amend taxes The brokerage company or payor of the dividends should withhold this tax at source. Amend taxes If tax is not withheld at the correct rate, you must file Form 1040NR to receive a refund or pay any additional tax due. Amend taxes If the capital gains and dividends are effectively connected with a U. Amend taxes S. Amend taxes trade or business, they are taxed according to the same rules and at the same rates that apply to U. Amend taxes S. Amend taxes citizens and residents. Amend taxes If you are a nonresident alien, 85% of any U. Amend taxes S. Amend taxes social security benefits (and the equivalent portion of tier 1 railroad retirement benefits) you receive is subject to the flat 30% tax, unless exempt, or subject to a lower treaty rate. Amend taxes See The 30% Tax in chapter 4. Amend taxes If you are a nonresident alien and the scholarship is not from U. Amend taxes S. Amend taxes sources, it is not subject to U. Amend taxes S. Amend taxes tax. Amend taxes See Scholarships, Grants, Prizes, and Awards in chapter 2 to determine whether your scholarship is from U. Amend taxes S. Amend taxes sources. Amend taxes If your scholarship is from U. Amend taxes S. Amend taxes sources or you are a resident alien, your scholarship is subject to U. Amend taxes S. Amend taxes tax according to the following rules. Amend taxes If you are a candidate for a degree, you may be able to exclude from your income the part of the scholarship you use to pay for tuition, fees, books, supplies, and equipment required by the educational institution. Amend taxes However, the part of the scholarship you use to pay for other expenses, such as room and board, is taxable. Amend taxes See Scholarships and Fellowship Grants in chapter 3 for more information. Amend taxes If you are not a candidate for a degree, your scholarship is taxable. Amend taxes Nonresident aliens cannot claim the standard deduction. Amend taxes However, see Students and business apprentices from India , under Itemized Deductions in chapter 5 for an exception. Amend taxes You cannot claim the standard deduction allowed on Form 1040. Amend taxes However, you can itemize any allowable deductions. Amend taxes Nonresident aliens can claim some of the same itemized deductions that resident aliens can claim. Amend taxes However, nonresident aliens can claim itemized deductions only if they have income effectively connected with their U. Amend taxes S. Amend taxes trade or business. Amend taxes See Itemized Deductions in chapter 5. Amend taxes Resident aliens can claim personal exemptions and exemptions for dependents in the same way as U. Amend taxes S. Amend taxes citizens. Amend taxes However, nonresident aliens generally can claim only a personal exemption for themselves on their U. Amend taxes S. Amend taxes tax return. Amend taxes There are special rules for residents of Mexico, Canada, and South Korea; for U. Amend taxes S. Amend taxes nationals; and for students and business apprentices from India. Amend taxes See Exemptions in chapter 5. Amend taxes As a dual-status taxpayer, you usually will be able to claim your own personal exemption. Amend taxes Subject to the general rules for qualification, you can claim exemptions for your spouse and dependents when you figure taxable income for the part of the year you are a resident alien. Amend taxes The amount you can claim for these exemptions is limited to your taxable income (figured before subtracting exemptions) for the part of the year you are a resident alien. Amend taxes You cannot use exemptions (other than your own) to reduce taxable income to less than zero for that period. Amend taxes If you are a nonresident alien for any part of the year, you cannot claim the earned income credit. Amend taxes See chapter 6 for more information on dual-status aliens. Amend taxes If you are a nonresident alien for any part of the year, you generally cannot claim the education credits. Amend taxes However, if you are married and choose to file a joint return with a U. Amend taxes S. Amend taxes citizen or resident spouse, you may be eligible for these credits. Amend taxes See Nonresident Spouse Treated as a Resident in chapter 1. Amend taxes Generally, services you perform as a nonresident alien temporarily in the United States as a nonimmigrant under subparagraph (F), (J), (M), or (Q) of section 101(a)(15) of the Immigration and Nationality Act are not covered under the social security program if you perform the services to carry out the purpose for which you were admitted to the United States. Amend taxes See Social Security and Medicare Taxes in chapter 8. Amend taxes If social security or Medicare taxes were withheld in error from pay that is not subject to these taxes, contact the employer who withheld the taxes for a refund. Amend taxes If you are unable to get a full refund of the amount from your employer, file a claim for refund with the Internal Revenue Service on Form 843, Claim for Refund and Request for Abatement. Amend taxes Do not use Form 843 to request a refund of Additional Medicare Tax. Amend taxes See Refund of Taxes Withheld in Error in chapter 8. Amend taxes Before leaving the United States, aliens generally must obtain a certificate of compliance. Amend taxes This document, also popularly known as the sailing permit or departure permit, is part of the income tax form you must file before leaving. Amend taxes You will receive a sailing or departure permit after filing a Form 1040-C or Form 2063. Amend taxes These forms are discussed in chapter 11. Amend taxes Form 1040-C is not an annual U. Amend taxes S. Amend taxes income tax return. Amend taxes If an income tax return is required by law, you must file that return even though you already filed a Form 1040-C. Amend taxes Chapters 5 and 7 discuss filing an annual U. Amend taxes S. Amend taxes income tax return. Amend taxes . Amend taxes When is my Form 1040NR due? If you are an employee and you receive wages subject to U. Amend taxes S. Amend taxes income tax withholding, you must generally file by the 15th day of the 4th month after your tax year ends. Amend taxes If you file for the 2013 calendar year, your return is due April 15, 2014. Amend taxes If you are not an employee who receives wages subject to U. Amend taxes S. Amend taxes income tax withholding, you must file by the 15th day of the 6th month after your tax year ends. Amend taxes For the 2013 calendar year, file your return by June 16, 2014. Amend taxes For more information on when and where to file, see chapter 7 . Amend taxes A social security number (SSN) must be furnished on returns, statements, and other tax-related documents. Amend taxes If your spouse does not have and is not eligible to get an SSN, he must apply for an individual taxpayer identification number (ITIN). Amend taxes If you are a U. Amend taxes S. Amend taxes citizen or resident and you choose to treat your nonresident spouse as a resident and file a joint tax return, your nonresident spouse needs an SSN or an ITIN. Amend taxes Alien spouses who are claimed as exemptions or dependents are also required to furnish an SSN or an ITIN. Amend taxes See Identification Number in chapter 5 for more information. Amend taxes Generally, you cannot file as married filing jointly if either spouse was a nonresident alien at any time during the tax year. Amend taxes However, nonresident aliens married to U. Amend taxes S. Amend taxes citizens or residents can choose to be treated as U. Amend taxes S. Amend taxes residents and file joint returns. Amend taxes For more information on this choice, see Nonresident Spouse Treated as a Resident in chapter 1. Amend taxes Assuming both of you had these visas for all of last year, you are a resident alien. Amend taxes Your husband is a nonresident alien if he has not been in the United States as a student for more than 5 years. Amend taxes You and your husband can file a joint tax return on Form 1040, 1040A, or 1040EZ if he makes the choice to be treated as a resident for the entire year. Amend taxes See Nonresident Spouse Treated as a Resident in chapter 1. Amend taxes If your husband does not make this choice, you must file a separate return on Form 1040 or Form 1040A. Amend taxes Your husband must file Form 1040NR or 1040NR-EZ. Amend taxes No. Amend taxes A dual-resident taxpayer is one who is a resident of both the United States and another country under each country's tax laws. Amend taxes See Effect of Tax Treaties in chapter 1. Amend taxes You are a dual-status taxpayer when you are both a resident alien and a nonresident alien in the same year. Amend taxes See chapter 6 . Amend taxes The following rules apply if the dividends and capital gains are not effectively connected with a U. Amend taxes S. Amend taxes trade or business. Amend taxes Capital gains are generally not taxable if you were in the United States for less than 183 days during the year. Amend taxes See Sales or Exchanges of Capital Assets in chapter 4 for more information and exceptions. Amend taxes Dividends are generally taxed at a 30% (or lower treaty) rate. Amend taxes The brokerage company or payor of the dividends should withhold this tax at source. Amend taxes If tax is not withheld at the correct rate, you must file Form 1040NR to receive a refund or pay any additional tax due. Amend taxes If the capital gains and dividends are effectively connected with a U. Amend taxes S. Amend taxes trade or business, they are taxed according to the same rules and at the same rates that apply to U. Amend taxes S. Amend taxes citizens and residents. Amend taxes If you are a nonresident alien, 85% of any U. Amend taxes S. Amend taxes social security benefits (and the equivalent portion of tier 1 railroad retirement benefits) you receive is subject to the flat 30% tax, unless exempt, or subject to a lower treaty rate. Amend taxes See The 30% Tax in chapter 4. Amend taxes If you are a nonresident alien and the scholarship is not from U. Amend taxes S. Amend taxes sources, it is not subject to U. Amend taxes S. Amend taxes tax. Amend taxes See Scholarships, Grants, Prizes, and Awards in chapter 2 to determine whether your scholarship is from U. Amend taxes S. Amend taxes sources. Amend taxes If your scholarship is from U. Amend taxes S. Amend taxes sources or you are a resident alien, your scholarship is subject to U. Amend taxes S. Amend taxes tax according to the following rules. Amend taxes If you are a candidate for a degree, you may be able to exclude from your income the part of the scholarship you use to pay for tuition, fees, books, supplies, and equipment required by the educational institution. Amend taxes However, the part of the scholarship you use to pay for other expenses, such as room and board, is taxable. Amend taxes See Scholarships and Fellowship Grants in chapter 3 for more information. Amend taxes If you are not a candidate for a degree, your scholarship is taxable. Amend taxes Nonresident aliens cannot claim the standard deduction. Amend taxes However, see Students and business apprentices from India , under Itemized Deductions in chapter 5 for an exception. Amend taxes You cannot claim the standard deduction allowed on Form 1040. Amend taxes However, you can itemize any allowable deductions. Amend taxes Nonresident aliens can claim some of the same itemized deductions that resident aliens can claim. Amend taxes However, nonresident aliens can claim itemized deductions only if they have income effectively connected with their U. Amend taxes S. Amend taxes trade or business. Amend taxes See Itemized Deductions in chapter 5. Amend taxes Resident aliens can claim personal exemptions and exemptions for dependents in the same way as U. Amend taxes S. Amend taxes citizens. Amend taxes However, nonresident aliens generally can claim only a personal exemption for themselves on their U. Amend taxes S. Amend taxes tax return. Amend taxes There are special rules for residents of Mexico, Canada, and South Korea; for U. Amend taxes S. Amend taxes nationals; and for students and business apprentices from India. Amend taxes See Exemptions in chapter 5. Amend taxes As a dual-status taxpayer, you usually will be able to claim your own personal exemption. Amend taxes Subject to the general rules for qualification, you can claim exemptions for your spouse and dependents when you figure taxable income for the part of the year you are a resident alien. Amend taxes The amount you can claim for these exemptions is limited to your taxable income (figured before subtracting exemptions) for the part of the year you are a resident alien. Amend taxes You cannot use exemptions (other than your own) to reduce taxable income to less than zero for that period. Amend taxes If you are a nonresident alien for any part of the year, you cannot claim the earned income credit. Amend taxes See chapter 6 for more information on dual-status aliens. Amend taxes If you are a nonresident alien for any part of the year, you generally cannot claim the education credits. Amend taxes However, if you are married and choose to file a joint return with a U. Amend taxes S. Amend taxes citizen or resident spouse, you may be eligible for these credits. Amend taxes See Nonresident Spouse Treated as a Resident in chapter 1. Amend taxes Generally, services you perform as a nonresident alien temporarily in the United States as a nonimmigrant under subparagraph (F), (J), (M), or (Q) of section 101(a)(15) of the Immigration and Nationality Act are not covered under the social security program if you perform the services to carry out the purpose
Print - Click this link to Print this page

Contact My Local Office in Connecticut

Face-to-face Tax Help

IRS Taxpayer Assistance Centers (TACs) are your source for personal tax help when you believe your tax issue can only be handled face-to-face. No appointment is necessary.

Keep in mind, many questions can be resolved online without waiting in line. Through IRS.gov you can:
• Set up a payment plan.
• Get a transcript of your tax return.
• Make a payment.
• Check on your refund.
• Find answers to many of your tax questions.

We are now referring all requests for tax return preparation services to other available resources. You can take advantage of free tax preparation through Free File, Free File Fillable Forms or through a volunteer site in your community. To find the nearest volunteer site location or to get more information about Free File, go to the top of the page and enter “Free Tax Help” in the Search box.

If you have a tax account issues and feel that it requires talking with someone face-to-face, visit your local TAC.

Caution:  Many of our offices are located in Federal Office Buildings. These buildings may not allow visitors to bring in cell phones with camera capabilities.

Multilingual assistance is available in every office. Hours of operation are subject to change.

Before visiting your local office click on "Services Provided" in the chart below to see what services are available. Services are limited and not all services are available at every TAC office and may vary from site to site. You can get these services on a walk-in basis.

City Street Address Days/Hours of Service Telephone*
Bridgeport 915 Lafayette Blvd.
Bridgeport, CT 06604

Monday-Friday - 8:30 a.m.-4:30 p.m.

 

**This office will be open until 6:00 p.m. on 4/14 & 4/15**

 

Services Provided

(203) 384-5818
Danbury 131 West St.
Danbury, CT 06810

Monday-Friday - 8:30 a.m.-4:30 p.m.
(Closed for lunch 12:00 noon - 1:00 p.m.)

 

Services Provided

(203) 840-4195 
Hartford  135 High St.
Hartford, CT 06103 

Monday-Friday - 8:30 a.m.-4:30 p.m.

 

Services Provided

(860) 756-4505 
New Haven  150 Court St.
New Haven, CT 06510 

Monday-Friday - 8:30 a.m.-4:30 p.m.

 

Services Provided

(203) 492-8609 
New London  Shaws Cove 2 Howard St.
New London, CT 06320 

Monday-Friday - 8:30 a.m.-4:30 p.m.
(Closed for lunch 12:00 noon - 1:00 p.m.)

 

Services Provided

(860) 439-7963 
Norwalk  761 Main Ave.
Norwalk, CT 06851 

Monday-Friday - 8:30 a.m.-4:30 p.m.
(Closed for Lunch 11:30 a.m. - 12:30 p.m.)

 

Services Provided

(203) 840-4195 
Waterbury  14 Cottage Pl.
Waterbury, CT 06702 

Monday-Friday - 8:30 a.m.-4:30 p.m.
 

Services Provided

(203) 596-4727 


* Note: The phone numbers in the chart above are not toll-free for all locations. When you call, you will reach a recorded business message with information about office hours, locations and services provided in that office. If face-to-face assistance is not a priority for you, you may also get help with IRS letters or resolve tax account issues by phone, toll free at 1-800-829-1040 (individuals) or 1-800-829-4933 (businesses).

For information on where to file your tax return please see Where to File Addresses.

The Taxpayer Advocate Service: Call (860) 756-4555 in Hartford or 1-877-777-4778 elsewhere, or see  Publication 1546, The Taxpayer Advocate Service of the IRS. For further information, see Tax Topic 104.

Partnerships

IRS and organizations all over the country are partnering to assist taxpayers. Through these partnerships, organizations are also achieving their own goals. These mutually beneficial partnerships are strengthening outreach efforts and bringing education and assistance to millions.

For more information about these programs for individuals and families, contact the Stakeholder Partnerships, Education and Communication Office at:

Internal Revenue Service
135 High St. Stop 116
Hartford, CT 06103

For more information about these programs for businesses, your local Stakeholder Liaison office establishes relationships with organizations representing small business and self-employed taxpayers. They provide information about the policies, practices and procedures the IRS uses to ensure compliance with the tax laws. To establish a relationship with us, use this list to find a contact in your state:

Stakeholder Liaison (SL) Phone Numbers for Organizations Representing Small Businesses and Self-employed Taxpayers.

Page Last Reviewed or Updated: 28-Mar-2014

The Amend Taxes

Amend taxes Publication 551 - Main Content Table of Contents Cost BasisStocks and Bonds Real Property Business Assets Allocating the Basis Adjusted BasisIncreases to Basis Decreases to Basis Adjustments to Basis Example Basis Other Than CostProperty Received for Services Taxable Exchanges Nontaxable Exchanges Property Transferred From a Spouse Property Received as a Gift Inherited Property Property Changed to Business or Rental Use How To Get Tax HelpLow Income Taxpayer Clinics (LITCs). Amend taxes Cost Basis The basis of property you buy is usually its cost. Amend taxes The cost is the amount you pay in cash, debt obligations, other property, or services. Amend taxes Your cost also includes amounts you pay for the following items. Amend taxes Sales tax, Freight, Installation and testing, Excise taxes, Legal and accounting fees (when they must be capitalized), Revenue stamps, Recording fees, and Real estate taxes (if assumed for the seller). Amend taxes  You may also have to capitalize (add to basis) certain other costs related to buying or producing property. Amend taxes Loans with low or no interest. Amend taxes   If you buy property on a time-payment plan that charges little or no interest, the basis of your property is your stated purchase price, minus the amount considered to be unstated interest. Amend taxes You generally have unstated interest if your interest rate is less than the applicable federal rate. Amend taxes For more information, see Unstated Interest and Original Issue Discount in Publication 537. Amend taxes Purchase of a business. Amend taxes   When you purchase a trade or business, you generally purchase all assets used in the business operations, such as land, buildings, and machinery. Amend taxes Allocate the price among the various assets, including any section 197 intangibles. Amend taxes See Allocating the Basis, later. Amend taxes Stocks and Bonds The basis of stocks or bonds you buy is generally the purchase price plus any costs of purchase, such as commissions and recording or transfer fees. Amend taxes If you get stocks or bonds other than by purchase, your basis is usually determined by the fair market value (FMV) or the previous owner's adjusted basis of the stock. Amend taxes You must adjust the basis of stocks for certain events that occur after purchase. Amend taxes See Stocks and Bonds in chapter 4 of Publication 550 for more information on the basis of stock. Amend taxes Identifying stock or bonds sold. Amend taxes   If you can adequately identify the shares of stock or the bonds you sold, their basis is the cost or other basis of the particular shares of stock or bonds. Amend taxes If you buy and sell securities at various times in varying quantities and you cannot adequately identify the shares you sell, the basis of the securities you sell is the basis of the securities you acquired first. Amend taxes For more information about identifying securities you sell, see Stocks and Bonds under Basis of Investment Property in chapter 4 of Publication 550. Amend taxes Mutual fund shares. Amend taxes   If you sell mutual fund shares acquired at different times and prices, you can choose to use an average basis. Amend taxes For more information, see Publication 550. Amend taxes Real Property Real property, also called real estate, is land and generally anything built on or attached to it. Amend taxes If you buy real property, certain fees and other expenses become part of your cost basis in the property. Amend taxes Real estate taxes. Amend taxes   If you pay real estate taxes the seller owed on real property you bought, and the seller did not reimburse you, treat those taxes as part of your basis. Amend taxes You cannot deduct them as taxes. Amend taxes   If you reimburse the seller for taxes the seller paid for you, you can usually deduct that amount as an expense in the year of purchase. Amend taxes Do not include that amount in the basis of the property. Amend taxes If you did not reimburse the seller, you must reduce your basis by the amount of those taxes. Amend taxes Settlement costs. Amend taxes   Your basis includes the settlement fees and closing costs for buying property. Amend taxes You cannot include in your basis the fees and costs for getting a loan on property. Amend taxes A fee for buying property is a cost that must be paid even if you bought the property for cash. Amend taxes   The following items are some of the settlement fees or closing costs you can include in the basis of your property. Amend taxes Abstract fees (abstract of title fees); Charges for installing utility services; Legal fees (including title search and preparation of the sales contract and deed); Recording fees; Surveys; Transfer taxes; Owner's title insurance; and Any amounts the seller owes that you agree to pay, such as back taxes or interest, recording or mortgage fees, charges for improvements or repairs, and sales commissions. Amend taxes   Settlement costs do not include amounts placed in escrow for the future payment of items such as taxes and insurance. Amend taxes   The following items are some settlement fees and closing costs you cannot include in the basis of the property. Amend taxes Casualty insurance premiums. Amend taxes Rent for occupancy of the property before closing. Amend taxes Charges for utilities or other services related to occupancy of the property before closing. Amend taxes Charges connected with getting a loan. Amend taxes The following are examples of these charges. Amend taxes Points (discount points, loan origination fees). Amend taxes Mortgage insurance premiums. Amend taxes Loan assumption fees. Amend taxes Cost of a credit report. Amend taxes Fees for an appraisal required by a lender. Amend taxes Fees for refinancing a mortgage. Amend taxes If these costs relate to business property, items (1) through (3) are deductible as business expenses. Amend taxes Items (4) and (5) must be capitalized as costs of getting a loan and can be deducted over the period of the loan. Amend taxes Points. Amend taxes   If you pay points to obtain a loan (including a mortgage, second mortgage, line of credit, or a home equity loan), do not add the points to the basis of the related property. Amend taxes Generally, you deduct the points over the term of the loan. Amend taxes For more information on how to deduct points, see Points in chapter 4 of Publication 535. Amend taxes Points on home mortgage. Amend taxes   Special rules may apply to points you and the seller pay when you obtain a mortgage to purchase your main home. Amend taxes If certain requirements are met, you can deduct the points in full for the year in which they are paid. Amend taxes Reduce the basis of your home by any seller-paid points. Amend taxes For more information, see Points in Publication 936, Home Mortgage Interest Deduction. Amend taxes Assumption of mortgage. Amend taxes   If you buy property and assume (or buy subject to) an existing mortgage on the property, your basis includes the amount you pay for the property plus the amount to be paid on the mortgage. Amend taxes Example. Amend taxes If you buy a building for $20,000 cash and assume a mortgage of $80,000 on it, your basis is $100,000. Amend taxes Constructing assets. Amend taxes   If you build property or have assets built for you, your expenses for this construction are part of your basis. Amend taxes Some of these expenses include the following costs. Amend taxes Land, Labor and materials, Architect's fees, Building permit charges, Payments to contractors, Payments for rental equipment, and Inspection fees. Amend taxes In addition, if you own a business and use your employees, material, and equipment to build an asset, do not deduct the following expenses. Amend taxes You must include them in the asset's basis. Amend taxes Employee wages paid for the construction work, reduced by any employment credits allowed; Depreciation on equipment you own while it is used in the construction; Operating and maintenance costs for equipment used in the construction; and The cost of business supplies and materials used in the construction. Amend taxes    Do not include the value of your own labor, or any other labor you did not pay for, in the basis of any property you construct. Amend taxes Business Assets If you purchase property to use in your business, your basis is usually its actual cost to you. Amend taxes If you construct, create, or otherwise produce property, you must capitalize the costs as your basis. Amend taxes In certain circumstances, you may be subject to the uniform capitalization rules, next. Amend taxes Uniform Capitalization Rules The uniform capitalization rules specify the costs you add to basis in certain circumstances. Amend taxes Activities subject to the rules. Amend taxes   You must use the uniform capitalization rules if you do any of the following in your trade or business or activity carried on for profit. Amend taxes Produce real or tangible personal property for use in the business or activity, Produce real or tangible personal property for sale to customers, or Acquire property for resale. Amend taxes However, this rule does not apply to personal property if your average annual gross receipts for the 3 previous tax years are $10 million or less. Amend taxes   You produce property if you construct, build, install, manufacture, develop, improve, create, raise, or grow the property. Amend taxes Treat property produced for you under a contract as produced by you up to the amount you pay or costs you otherwise incur for the property. Amend taxes Tangible personal property includes films, sound recordings, video tapes, books, or similar property. Amend taxes    Under the uniform capitalization rules, you must capitalize all direct costs and an allocable part of most indirect costs you incur due to your production or resale activities. Amend taxes To capitalize means to include certain expenses in the basis of property you produce or in your inventory costs rather than deduct them as a current expense. Amend taxes You recover these costs through deductions for depreciation, amortization, or cost of goods sold when you use, sell, or otherwise dispose of the property. Amend taxes   Any cost you cannot use to figure your taxable income for any tax year is not subject to the uniform capitalization rules. Amend taxes Example. Amend taxes If you incur a business meal expense for which your deduction would be limited to 50% of the cost of the meal, that amount is subject to the uniform capitalization rules. Amend taxes The nondeductible part of the cost is not subject to the uniform capitalization rules. Amend taxes More information. Amend taxes   For more information about these rules, see the regulations under section 263A of the Internal Revenue Code and Publication 538, Accounting Periods and Methods. Amend taxes Exceptions. Amend taxes   The following are not subject to the uniform capitalization rules. Amend taxes Property you produce that you do not use in your trade, business, or activity conducted for profit; Qualified creative expenses you pay or incur as a free-lance (self-employed) writer, photographer, or artist that are otherwise deductible on your tax return; Property you produce under a long-term contract, except for certain home construction contracts; Research and experimental expenses deductible under section 174 of the Internal Revenue Code; and Costs for personal property acquired for resale if your (or your predecessor's) average annual gross receipts for the 3 previous tax years do not exceed $10 million. Amend taxes For other exceptions to the uniform capitalization rules, see section 1. Amend taxes 263A-1(b) of the regulations. Amend taxes   For information on the special rules that apply to costs incurred in the business of farming, see chapter 6 of Publication 225, Farmer's Tax Guide. Amend taxes Intangible Assets Intangible assets include goodwill, patents, copyrights, trademarks, trade names, and franchises. Amend taxes The basis of an intangible asset is usually the cost to buy or create it. Amend taxes If you acquire multiple assets, for example a going business for a lump sum, see Allocating the Basis below to figure the basis of the individual assets. Amend taxes The basis of certain intangibles can be amortized. Amend taxes See chapter 8 of Publication 535 for information on the amortization of these costs. Amend taxes Patents. Amend taxes   The basis of a patent you get for an invention is the cost of development, such as research and experimental expenditures, drawings, working models, and attorneys' and governmental fees. Amend taxes If you deduct the research and experimental expenditures as current business expenses, you cannot include them in the basis of the patent. Amend taxes The value of the inventor's time spent on an invention is not part of the basis. Amend taxes Copyrights. Amend taxes   If you are an author, the basis of a copyright will usually be the cost of getting the copyright plus copyright fees, attorneys' fees, clerical assistance, and the cost of plates that remain in your possession. Amend taxes Do not include the value of your time as the author, or any other person's time you did not pay for. Amend taxes Franchises, trademarks, and trade names. Amend taxes   If you buy a franchise, trademark, or trade name, the basis is its cost, unless you can deduct your payments as a business expense. Amend taxes Allocating the Basis If you buy multiple assets for a lump sum, allocate the amount you pay among the assets you receive. Amend taxes You must make this allocation to figure your basis for depreciation and gain or loss on a later disposition of any of these assets. Amend taxes See Trade or Business Acquired below. Amend taxes Group of Assets Acquired If you buy multiple assets for a lump sum, you and the seller may agree to a specific allocation of the purchase price among the assets in the sales contract. Amend taxes If this allocation is based on the value of each asset and you and the seller have adverse tax interests, the allocation generally will be accepted. Amend taxes However, see Trade or Business Acquired, next. Amend taxes Trade or Business Acquired If you acquire a trade or business, allocate the consideration paid to the various assets acquired. Amend taxes Generally, reduce the consideration paid by any cash and general deposit accounts (including checking and savings accounts) received. Amend taxes Allocate the remaining consideration to the other business assets received in proportion to (but not more than) their fair market value in the following order. Amend taxes Certificates of deposit, U. Amend taxes S. Amend taxes Government securities, foreign currency, and actively traded personal property, including stock and securities. Amend taxes Accounts receivable, other debt instruments, and assets you mark to market at least annually for federal income tax purposes. Amend taxes Property of a kind that would properly be included in inventory if on hand at the end of the tax year or property held primarily for sale to customers in the ordinary course of business. Amend taxes All other assets except section 197 intangibles, goodwill, and going concern value. Amend taxes Section 197 intangibles except goodwill and going concern value. Amend taxes Goodwill and going concern value (whether or not they qualify as section 197 intangibles). Amend taxes Agreement. Amend taxes   The buyer and seller may enter into a written agreement as to the allocation of any consideration or the fair market value (FMV) of any of the assets. Amend taxes This agreement is binding on both parties unless the IRS determines the amounts are not appropriate. Amend taxes Reporting requirement. Amend taxes   Both the buyer and seller involved in the sale of business assets must report to the IRS the allocation of the sales price among section 197 intangibles and the other business assets. Amend taxes Use Form 8594 to provide this information. Amend taxes The buyer and seller should each attach Form 8594 to their federal income tax return for the year in which the sale occurred. Amend taxes More information. Amend taxes   See Sale of a Business in chapter 2 of Publication 544 for more information. Amend taxes Land and Buildings If you buy buildings and the land on which they stand for a lump sum, allocate the basis of the property among the land and the buildings so you can figure the depreciation allowable on the buildings. Amend taxes Figure the basis of each asset by multiplying the lump sum by a fraction. Amend taxes The numerator is the FMV of that asset and the denominator is the FMV of the whole property at the time of purchase. Amend taxes If you are not certain of the FMV of the land and buildings, you can allocate the basis based on their assessed values for real estate tax purposes. Amend taxes Demolition of building. Amend taxes   Add demolition costs and other losses incurred for the demolition of any building to the basis of the land on which the demolished building was located. Amend taxes Do not claim the costs as a current deduction. Amend taxes Modification of building. Amend taxes   A modification of a building will not be treated as a demolition if the following conditions are satisfied. Amend taxes 75 percent or more of the existing external walls of the building are retained in place as internal or external walls, and 75 percent or more of the existing internal structural framework of the building is retained in place. Amend taxes   If the building is a certified historic structure, the modification must also be part of a certified rehabilitation. Amend taxes   If these conditions are met, add the costs of the modifications to the basis of the building. Amend taxes Subdivided lots. Amend taxes   If you buy a tract of land and subdivide it, you must determine the basis of each lot. Amend taxes This is necessary because you must figure the gain or loss on the sale of each individual lot. Amend taxes As a result, you do not recover your entire cost in the tract until you have sold all of the lots. Amend taxes   To determine the basis of an individual lot, multiply the total cost of the tract by a fraction. Amend taxes The numerator is the FMV of the lot and the denominator is the FMV of the entire tract. Amend taxes Future improvement costs. Amend taxes   If you are a developer and sell subdivided lots before the development work is completed, you can (with IRS consent) include in the basis of the properties sold an allocation of the estimated future cost for common improvements. Amend taxes See Revenue Procedure 92–29 for more information, including an explanation of the procedures for getting consent from the IRS. Amend taxes Use of erroneous cost basis. Amend taxes   If you made a mistake in figuring the cost basis of subdivided lots sold in previous years, you cannot correct the mistake for years for which the statute of limitations (generally 3 tax years) has expired. Amend taxes Figure the basis of any remaining lots by allocating the correct original cost basis of the entire tract among the original lots. Amend taxes Example. Amend taxes You bought a tract of land to which you assigned a cost of $15,000. Amend taxes You subdivided the land into 15 building lots of equal size and equitably divided your basis so that each lot had a basis of $1,000. Amend taxes You treated the sale of each lot as a separate transaction and figured gain or loss separately on each sale. Amend taxes Several years later you determine that your original basis in the tract was $22,500 and not $15,000. Amend taxes You sold eight lots using $8,000 of basis in years for which the statute of limitations has expired. Amend taxes You now can take $1,500 of basis into account for figuring gain or loss only on the sale of each of the remaining seven lots ($22,500 basis divided among all 15 lots). Amend taxes You cannot refigure the basis of the eight lots sold in tax years barred by the statute of limitations. Amend taxes Adjusted Basis Before figuring gain or loss on a sale, exchange, or other disposition of property or figuring allowable depreciation, depletion, or amortization, you must usually make certain adjustments to the basis of the property. Amend taxes The result of these adjustments to the basis is the adjusted basis. Amend taxes Increases to Basis Increase the basis of any property by all items properly added to a capital account. Amend taxes These include the cost of any improvements having a useful life of more than 1 year. Amend taxes Rehabilitation expenses also increase basis. Amend taxes However, you must subtract any rehabilitation credit allowed for these expenses before you add them to your basis. Amend taxes If you have to recapture any of the credit, increase your basis by the recaptured amount. Amend taxes If you make additions or improvements to business property, keep separate accounts for them. Amend taxes Also, you must depreciate the basis of each according to the depreciation rules that would apply to the underlying property if you had placed it in service at the same time you placed the addition or improvement in service. Amend taxes For more information, see Publication 946. Amend taxes The following items increase the basis of property. Amend taxes The cost of extending utility service lines to the property; Impact fees; Legal fees, such as the cost of defending and perfecting title; Legal fees for obtaining a decrease in an assessment levied against property to pay for local improvements; Zoning costs; and The capitalized value of a redeemable ground rent. Amend taxes Assessments for Local Improvements Increase the basis of property by assessments for items such as paving roads and building ditches that increase the value of the property assessed. Amend taxes Do not deduct them as taxes. Amend taxes However, you can deduct as taxes charges for maintenance, repairs, or interest charges related to the improvements. Amend taxes Example. Amend taxes Your city changes the street in front of your store into an enclosed pedestrian mall and assesses you and other affected landowners for the cost of the conversion. Amend taxes Add the assessment to your property's basis. Amend taxes In this example, the assessment is a depreciable asset. Amend taxes Deducting vs. Amend taxes Capitalizing Costs Do not add to your basis costs you can deduct as current expenses. Amend taxes For example, amounts paid for incidental repairs or maintenance that are deductible as business expenses cannot be added to basis. Amend taxes However, you can choose either to deduct or to capitalize certain other costs. Amend taxes If you capitalize these costs, include them in your basis. Amend taxes If you deduct them, do not include them in your basis. Amend taxes See Uniform Capitalization Rules earlier. Amend taxes The costs you can choose to deduct or to capitalize include the following. Amend taxes Carrying charges, such as interest and taxes, that you pay to own property, except carrying charges that must be capitalized under the uniform capitalization rules; Research and experimentation costs; Intangible drilling and development costs for oil, gas, and geothermal wells; Exploration costs for new mineral deposits; Mining development costs for a new mineral deposit; Costs of establishing, maintaining, or increasing the circulation of a newspaper or other periodical; and Costs of removing architectural and transportation barriers to people with disabilities and the elderly. Amend taxes If you claim the disabled access credit, you must reduce the amount you deduct or capitalize by the amount of the credit. Amend taxes For more information about deducting or capitalizing costs, see chapter 7 in Publication 535. Amend taxes Table 1. Amend taxes Examples of Increases and Decreases to Basis Increases to Basis Decreases to Basis Capital improvements:   Putting an addition on your home   Replacing an entire roof  Paving your driveway  Installing central air conditioning Rewiring your home Exclusion from income of subsidies for energy conservation measures  Casualty or theft loss deductions and insurance reimbursements  Vehicle credits Assessments for local improvements: Water connections Sidewalks Roads Section 179 deduction  Casualty losses: Restoring damaged property Depreciation  Nontaxable corporate distributions Legal fees:  Cost of defending and perfecting a title   Zoning costs   Decreases to Basis The following are some items that reduce the basis of property. Amend taxes Section 179 deduction; Nontaxable corporate distributions; Deductions previously allowed (or allowable) for amortization, depreciation, and depletion; Exclusion of subsidies for energy conservation measures; Vehicle credits; Residential energy credits; Postponed gain from sale of home; Investment credit (part or all) taken; Casualty and theft losses and insurance reimbursement; Certain canceled debt excluded from income; Rebates from a manufacturer or seller; Easements; Gas-guzzler tax; Adoption tax benefits; and Credit for employer-provided child care. Amend taxes Some of these items are discussed next. Amend taxes Casualties and Thefts If you have a casualty or theft loss, decrease the basis in your property by any insurance or other reimbursement and by any deductible loss not covered by insurance. Amend taxes You must increase your basis in the property by the amount you spend on repairs that substantially prolong the life of the property, increase its value, or adapt it to a different use. Amend taxes To make this determination, compare the repaired property to the property before the casualty. Amend taxes For more information on casualty and theft losses, see Publication 547, Casualties, Disasters, and Thefts. Amend taxes Easements The amount you receive for granting an easement is generally considered to be a sale of an interest in real property. Amend taxes It reduces the basis of the affected part of the property. Amend taxes If the amount received is more than the basis of the part of the property affected by the easement, reduce your basis in that part to zero and treat the excess as a recognized gain. Amend taxes Vehicle Credits Unless you elect not to claim the qualified plug-in electric vehicle credit, the alternative motor vehicle credit, or the qualified plug-in electric drive motor vehicle credit, you may have to reduce the basis of each qualified vehicle by certain amounts reported. Amend taxes For more information, see Form 8834, Qualified Plug-in Electric and Electric Vehicle Credit; Form 8910, Alternative Motor Vehicle Credit; Form 8936, Qualified Plug-in Electric Drive Motor Vehicle Credit;and the related instructions. Amend taxes Gas-Guzzler Tax Decrease the basis in your car by the gas-guzzler (fuel economy) tax if you begin using the car within 1 year of the date of its first sale for ultimate use. Amend taxes This rule also applies to someone who later buys the car and begins using it not more than 1 year after the original sale for ultimate use. Amend taxes If the car is imported, the one-year period begins on the date of entry or withdrawal of the car from the warehouse if that date is later than the date of the first sale for ultimate use. Amend taxes Section 179 Deduction If you take the section 179 deduction for all or part of the cost of qualifying business property, decrease the basis of the property by the deduction. Amend taxes For more information about the section 179 deduction, see Publication 946. Amend taxes Exclusion of Subsidies for Energy Conservation Measures You can exclude from gross income any subsidy you received from a public utility company for the purchase or installation of any energy conservation measure for a dwelling unit. Amend taxes Reduce the basis of the property for which you received the subsidy by the excluded amount. Amend taxes For more information on this subsidy, see Publication 525. Amend taxes Depreciation Decrease the basis of property by the depreciation you deducted, or could have deducted, on your tax returns under the method of depreciation you chose. Amend taxes If you took less depreciation than you could have under the method chosen, decrease the basis by the amount you could have taken under that method. Amend taxes If you did not take a depreciation deduction, reduce the basis by the full amount of the depreciation you could have taken. Amend taxes Unless a timely election is made not to deduct the special depreciation allowance for property placed in service after September 10, 2001, decrease the property's basis by the special depreciation allowance you deducted or could have deducted. Amend taxes If you deducted more depreciation than you should have, decrease your basis by the amount equal to the depreciation you should have deducted plus the part of the excess depreciation you deducted that actually reduced your tax liability for the year. Amend taxes In decreasing your basis for depreciation, take into account the amount deducted on your tax returns as depreciation and any depreciation capitalized under the uniform capitalization rules. Amend taxes For information on figuring depreciation, see Publication 946. Amend taxes If you are claiming depreciation on a business vehicle, see Publication 463. Amend taxes If the car is not used more than 50% for business during the tax year, you may have to recapture excess depreciation. Amend taxes Include the excess depreciation in your gross income and add it to your basis in the property. Amend taxes For information on the computation of excess depreciation, see chapter 4 in Publication 463. Amend taxes Canceled Debt Excluded From Income If a debt you owe is canceled or forgiven, other than as a gift or bequest, you generally must include the canceled amount in your gross income for tax purposes. Amend taxes A debt includes any indebtedness for which you are liable or which attaches to property you hold. Amend taxes You can exclude canceled debt from income in the following situations. Amend taxes Debt canceled in a bankruptcy case or when you are insolvent, Qualified farm debt, and Qualified real property business debt (provided you are not a C corporation). Amend taxes If you exclude from income canceled debt under situation (1) or (2), you may have to reduce the basis of your depreciable and nondepreciable property. Amend taxes However, in situation (3), you must reduce the basis of your depreciable property by the excluded amount. Amend taxes For more information about canceled debt in a bankruptcy case or during insolvency, see Publication 908, Bankruptcy Tax Guide. Amend taxes For more information about canceled debt that is qualified farm debt, see chapter 3 in Publication 225. Amend taxes For more information about qualified real property business debt, see chapter 5 in Publication 334, Tax Guide for Small Business. Amend taxes Postponed Gain From Sale of Home If you postponed gain from the sale of your main home before May 7, 1997, you must reduce the basis of your new home by the postponed gain. Amend taxes For more information on the rules for the sale of a home, see Publication 523. Amend taxes Adoption Tax Benefits If you claim an adoption credit for the cost of improvements you added to the basis of your home, decrease the basis of your home by the credit allowed. Amend taxes This also applies to amounts you received under an employer's adoption assistance program and excluded from income. Amend taxes For more information Form 8839, Qualified Adoption Expenses. Amend taxes Employer-Provided Child Care If you are an employer, you can claim the employer-provided child care credit on amounts you paid or incurred to acquire, construct, rehabilitate, or expand property used as part of your qualified child care facility. Amend taxes You must reduce your basis in that property by the credit claimed. Amend taxes For more information, see Form 8882, Credit for Employer-Provided Child Care Facilities and Services. Amend taxes Adjustments to Basis Example In January 2005, you paid $80,000 for real property to be used as a factory. Amend taxes You also paid commissions of $2,000 and title search and legal fees of $600. Amend taxes You allocated the total cost of $82,600 between the land and the building—$10,325 for the land and $72,275 for the building. Amend taxes Immediately you spent $20,000 in remodeling the building before you placed it in service. Amend taxes You were allowed depreciation of $14,526 for the years 2005 through 2009. Amend taxes In 2008 you had a $5,000 casualty loss from a that was not covered by insurance on the building. Amend taxes You claimed a deduction for this loss. Amend taxes You spent $5,500 to repair the damages and extend the useful life of the building. Amend taxes The adjusted basis of the building on January 1, 2010, is figured as follows: Original cost of building including fees and commissions $72,275 Adjustments to basis:     Add:         Improvements 20,000   Repair of damages 5,500       $97,775 Subtract:       Depreciation $14,526     Deducted casualty loss 5,000 19,526 Adjusted basis on January 1, 2010 $78,249 The basis of the land, $10,325, remains unchanged. Amend taxes It is not affected by any of the above adjustments. Amend taxes Basis Other Than Cost There are many times when you cannot use cost as basis. Amend taxes In these cases, the fair market value or the adjusted basis of property may be used. Amend taxes Adjusted basis is discussed earlier. Amend taxes Fair market value (FMV). Amend taxes   FMV is the price at which property would change hands between a buyer and a seller, neither having to buy or sell, and both having reasonable knowledge of all necessary facts. Amend taxes Sales of similar property on or about the same date may be helpful in figuring the property's FMV. Amend taxes Property Received for Services If you receive property for services, include the property's FMV in income. Amend taxes The amount you include in income becomes your basis. Amend taxes If the services were performed for a price agreed on beforehand, it will be accepted as the FMV of the property if there is no evidence to the contrary. Amend taxes Bargain Purchases A bargain purchase is a purchase of an item for less than its FMV. Amend taxes If, as compensation for services, you purchase goods or other property at less than FMV, include the difference between the purchase price and the property's FMV in your income. Amend taxes Your basis in the property is its FMV (your purchase price plus the amount you include in income). Amend taxes If the difference between your purchase price and the FMV represents a qualified employee discount, do not include the difference in income. Amend taxes However, your basis in the property is still its FMV. Amend taxes See Employee Discounts in Publication 15-B. Amend taxes Restricted Property If you receive property for your services and the property is subject to certain restrictions, your basis in the property is its FMV when it becomes substantially vested unless you make the election discussed later. Amend taxes Property becomes substantially vested when your rights in the property or the rights of any person to whom you transfer the property are not subject to a substantial risk of forfeiture. Amend taxes There is substantial risk of forfeiture when the rights to full enjoyment of the property depend on the future performance of substantial services by any person. Amend taxes When the property becomes substantially vested, include the FMV, less any amount you paid for the property, in income. Amend taxes Example. Amend taxes Your employer gives you stock for services performed under the condition that you will have to return the stock unless you complete 5 years of service. Amend taxes The stock is under a substantial risk of forfeiture and is not substantially vested when you receive it. Amend taxes You do not report any income until you have completed the 5 years of service that satisfy the condition. Amend taxes Fair market value. Amend taxes   Figure the FMV of property you received without considering any restriction except one that by its terms will never end. Amend taxes Example. Amend taxes You received stock from your employer for services you performed. Amend taxes If you want to sell the stock while you are still employed, you must sell the stock to your employer at book value. Amend taxes At your retirement or death, you or your estate must offer to sell the stock to your employer at its book value. Amend taxes This is a restriction that by its terms will never end and you must consider it when you figure the FMV. Amend taxes Election. Amend taxes   You can choose to include in your gross income the FMV of the property at the time of transfer, less any amount you paid for it. Amend taxes If you make this choice, the substantially vested rules do not apply. Amend taxes Your basis is the amount you paid plus the amount you included in income. Amend taxes   See the discussion of Restricted Property in Publication 525 for more information. Amend taxes Taxable Exchanges A taxable exchange is one in which the gain is taxable or the loss is deductible. Amend taxes A taxable gain or deductible loss is also known as a recognized gain or loss. Amend taxes If you receive property in exchange for other property in a taxable exchange, the basis of property you receive is usually its FMV at the time of the exchange. Amend taxes A taxable exchange occurs when you receive cash or property not similar or related in use to the property exchanged. Amend taxes Example. Amend taxes You trade a tract of farm land with an adjusted basis of $3,000 for a tractor that has an FMV of $6,000. Amend taxes You must report a taxable gain of $3,000 for the land. Amend taxes The tractor has a basis of $6,000. Amend taxes Involuntary Conversions If you receive property as a result of an involuntary conversion, such as a casualty, theft, or condemnation, you can figure the basis of the replacement property you receive using the basis of the converted property. Amend taxes Similar or related property. Amend taxes   If you receive replacement property similar or related in service or use to the converted property, the replacement property's basis is the old property's basis on the date of the conversion. Amend taxes However, make the following adjustments. Amend taxes Decrease the basis by the following. Amend taxes Any loss you recognize on the conversion, and Any money you receive that you do not spend on similar property. Amend taxes Increase the basis by the following. Amend taxes Any gain you recognize on the conversion, and Any cost of acquiring the replacement property. Amend taxes Money or property not similar or related. Amend taxes   If you receive money or property not similar or related in service or use to the converted property, and you buy replacement property similar or related in service or use to the converted property, the basis of the new property is its cost decreased by the gain not recognized on the conversion. Amend taxes Example. Amend taxes The state condemned your property. Amend taxes The property had an adjusted basis of $26,000 and the state paid you $31,000 for it. Amend taxes You realized a gain of $5,000 ($31,000 − $26,000). Amend taxes You bought replacement property similar in use to the converted property for $29,000. Amend taxes You recognize a gain of $2,000 ($31,000 − $29,000), the unspent part of the payment from the state. Amend taxes Your gain not recognized is $3,000, the difference between the $5,000 realized gain and the $2,000 recognized gain. Amend taxes The basis of the new property is figured as follows: Cost of replacement property $29,000 Minus: Gain not recognized 3,000 Basis of the replacement property $26,000 Allocating the basis. Amend taxes   If you buy more than one piece of replacement property, allocate your basis among the properties based on their respective costs. Amend taxes Example. Amend taxes The state in the previous example condemned your unimproved real property and the replacement property you bought was improved real property with both land and buildings. Amend taxes Allocate the replacement property's $26,000 basis between land and buildings based on their respective costs. Amend taxes More information. Amend taxes   For more information about condemnations, see Involuntary Conversions in Publication 544. Amend taxes For more information about casualty and theft losses, see Publication 547. Amend taxes Nontaxable Exchanges A nontaxable exchange is an exchange in which you are not taxed on any gain and you cannot deduct any loss. Amend taxes If you receive property in a nontaxable exchange, its basis is usually the same as the basis of the property you transferred. Amend taxes A nontaxable gain or loss is also known as an unrecognized gain or loss. Amend taxes Like-Kind Exchanges The exchange of property for the same kind of property is the most common type of nontaxable exchange. Amend taxes To qualify as a like-kind exchange, you must hold for business or investment purposes both the property you transfer and the property you receive. Amend taxes There must also be an exchange of like-kind property. Amend taxes For more information, see Like-Kind Exchanges in Publication 544. Amend taxes The basis of the property you receive is the same as the basis of the property you gave up. Amend taxes Example. Amend taxes You exchange real estate (adjusted basis $50,000, FMV $80,000) held for investment for other real estate (FMV $80,000) held for investment. Amend taxes Your basis in the new property is the same as the basis of the old ($50,000). Amend taxes Exchange expenses. Amend taxes   Exchange expenses are generally the closing costs you pay. Amend taxes They include such items as brokerage commissions, attorney fees, deed preparation fees, etc. Amend taxes Add them to the basis of the like-kind property received. Amend taxes Property plus cash. Amend taxes   If you trade property in a like-kind exchange and also pay money, the basis of the property received is the basis of the property you gave up increased by the money you paid. Amend taxes Example. Amend taxes You trade in a truck (adjusted basis $3,000) for another truck (FMV $7,500) and pay $4,000. Amend taxes Your basis in the new truck is $7,000 (the $3,000 basis of the old truck plus the $4,000 paid). Amend taxes Special rules for related persons. Amend taxes   If a like-kind exchange takes place directly or indirectly between related persons and either party disposes of the property within 2 years after the exchange, the exchange no longer qualifies for like-kind exchange treatment. Amend taxes Each person must report any gain or loss not recognized on the original exchange. Amend taxes Each person reports it on the tax return filed for the year in which the later disposition occurs. Amend taxes If this rule applies, the basis of the property received in the original exchange will be its fair market value. Amend taxes   These rules generally do not apply to the following kinds of property dispositions. Amend taxes Dispositions due to the death of either related person, Involuntary conversions, and Dispositions in which neither the original exchange nor the subsequent disposition had as a main purpose the avoidance of federal income tax. Amend taxes Related persons. Amend taxes   Generally, related persons are ancestors, lineal descendants, brothers and sisters (whole or half), and a spouse. Amend taxes   For other related persons (for example, two corporations, an individual and a corporation, a grantor and fiduciary, etc. Amend taxes ), see Nondeductible Loss in chapter 2 of Publication 544. Amend taxes Exchange of business property. Amend taxes   Exchanging the assets of one business for the assets of another business is a multiple property exchange. Amend taxes For information on figuring basis, see Multiple Property Exchanges in chapter 1 of Publication 544. Amend taxes Partially Nontaxable Exchange A partially nontaxable exchange is an exchange in which you receive unlike property or money in addition to like property. Amend taxes The basis of the property you receive is the same as the basis of the property you gave up, with the following adjustments. Amend taxes Decrease the basis by the following amounts. Amend taxes Any money you receive, and Any loss you recognize on the exchange. Amend taxes Increase the basis by the following amounts. Amend taxes Any additional costs you incur, and Any gain you recognize on the exchange. Amend taxes If the other party to the exchange assumes your liabilities, treat the debt assumption as money you received in the exchange. Amend taxes Example. Amend taxes You traded a truck (adjusted basis $6,000) for a new truck (FMV $5,200) and $1,000 cash. Amend taxes You realized a gain of $200 ($6,200 − $6,000). Amend taxes This is the FMV of the truck received plus the cash minus the adjusted basis of the truck you traded ($5,200 + $1,000 – $6,000). Amend taxes You include all the gain in income (recognized gain) because the gain is less than the cash received. Amend taxes Your basis in the new truck is: Adjusted basis of old truck $6,000 Minus: Cash received (adjustment 1(a)) 1,000   $5,000 Plus: Gain recognized (adjustment 2(b)) 200 Basis of new truck $5,200 Allocation of basis. Amend taxes   Allocate the basis first to the unlike property, other than money, up to its FMV on the date of the exchange. Amend taxes The rest is the basis of the like property. Amend taxes Example. Amend taxes You had an adjusted basis of $15,000 in real estate you held for investment. Amend taxes You exchanged it for other real estate to be held for investment with an FMV of $12,500, a truck with an FMV of $3,000, and $1,000 cash. Amend taxes The truck is unlike property. Amend taxes You realized a gain of $1,500 ($16,500 − $15,000). Amend taxes This is the FMV of the real estate received plus the FMV of the truck received plus the cash minus the adjusted basis of the real estate you traded ($12,500 + $3,000 + $1,000 – $15,000). Amend taxes You include in income (recognize) all $1,500 of the gain because it is less than the FMV of the unlike property plus the cash received. Amend taxes Your basis in the properties you received is figured as follows. Amend taxes Adjusted basis of real estate transferred $15,000 Minus: Cash received (adjustment 1(a)) 1,000   $14,000 Plus: Gain recognized (adjustment 2(b)) 1,500 Total basis of properties received $15,500 Allocate the total basis of $15,500 first to the unlike property — the truck ($3,000). Amend taxes This is the truck's FMV. Amend taxes The rest ($12,500) is the basis of the real estate. Amend taxes Sale and Purchase If you sell property and buy similar property in two mutually dependent transactions, you may have to treat the sale and purchase as a single nontaxable exchange. Amend taxes Example. Amend taxes You are a salesperson and you use one of your cars 100% for business. Amend taxes You have used this car in your sales activities for 2 years and have depreciated it. Amend taxes Your adjusted basis in the car is $22,600 and its FMV is $23,100. Amend taxes You are interested in a new car, which sells for $28,000. Amend taxes If you trade your old car and pay $4,900 for the new one, your basis for depreciation for the new car would be $27,500 ($4,900 plus the $22,600 basis of your old car). Amend taxes However, you want a higher basis for depreciating the new car, so you agree to pay the dealer $28,000 for the new car if he will pay you $23,100 for your old car. Amend taxes Because the two transactions are dependent on each other, you are treated as having exchanged your old car for the new one and paid $4,900 ($28,000 − $23,100). Amend taxes Your basis for depreciating the new car is $27,500, the same as if you traded the old car. Amend taxes Partial Business Use of Property If you have property used partly for business and partly for personal use, and you exchange it in a nontaxable exchange for property to be used wholly or partly in your business, the basis of the property you receive is figured as if you had exchanged two properties. Amend taxes The first is an exchange of like-kind property. Amend taxes The second is personal-use property on which gain is recognized and loss is not recognized. Amend taxes First, figure your adjusted basis in the property as if you transferred two separate properties. Amend taxes Figure the adjusted basis of each part of the property by taking into account any adjustments to basis. Amend taxes Deduct the depreciation you took or could have taken from the adjusted basis of the business part. Amend taxes Then figure the amount realized for your property and allocate it to the business and nonbusiness parts of the property. Amend taxes The business part of the property is permitted to be exchanged tax free. Amend taxes However, you must recognize any gain from the exchange of the nonbusiness part. Amend taxes You are deemed to have received, in exchange for the nonbusiness part, an amount equal to its FMV on the date of the exchange. Amend taxes The basis of the property you acquired is the total basis of the property transferred (adjusted to the date of the exchange), increased by any gain recognized on the nonbusiness part. Amend taxes If the nonbusiness part of the property transferred is your main home, you may qualify to exclude from income all or part of the gain on that part. Amend taxes For more information, see Publication 523. Amend taxes Trade of car used partly in business. Amend taxes   If you trade in a car you used partly in your business for another car you will use in your business, your basis for depreciation of the new car is not the same as your basis for figuring a gain or loss on its sale. Amend taxes   For information on figuring your basis for depreciation, see Publication 463. Amend taxes Property Transferred From a Spouse The basis of property transferred to you or transferred in trust for your benefit by your spouse (or former spouse if the transfer is incident to divorce), is the same as your spouse's adjusted basis. Amend taxes However, adjust your basis for any gain recognized by your spouse or former spouse on property transferred in trust. Amend taxes This rule applies only to a transfer of property in trust in which the liabilities assumed, plus the liabilities to which the property is subject, are more than the adjusted basis of the property transferred. Amend taxes If the property transferred to you is a series E, series EE, or series I United States savings bond, the transferor must include in income the interest accrued to the date of transfer. Amend taxes Your basis in the bond immediately after the transfer is equal to the transferor's basis increased by the interest income includible in the transferor's income. Amend taxes For more information on these bonds, see Publication 550. Amend taxes At the time of the transfer, the transferor must give you the records necessary to determine the adjusted basis and holding period of the property as of the date of transfer. Amend taxes For more information, see Publication 504, Divorced or Separated Individuals. Amend taxes Property Received as a Gift To figure the basis of property you receive as a gift, you must know its adjusted basis (defined earlier) to the donor just before it was given to you, its FMV at the time it was given to you, and any gift tax paid on it. Amend taxes FMV Less Than Donor's Adjusted Basis If the FMV of the property at the time of the gift is less than the donor's adjusted basis, your basis depends on whether you have a gain or a loss when you dispose of the property. Amend taxes Your basis for figuring gain is the same as the donor's adjusted basis plus or minus any required adjustment to basis while you held the property. Amend taxes Your basis for figuring loss is its FMV when you received the gift plus or minus any required adjustment to basis while you held the property (see Adjusted Basis earlier). Amend taxes If you use the donor's adjusted basis for figuring a gain and get a loss, and then use the FMV for figuring a loss and have a gain, you have neither gain nor loss on the sale or disposition of the property. Amend taxes Example. Amend taxes You received an acre of land as a gift. Amend taxes At the time of the gift, the land had an FMV of $8,000. Amend taxes The donor's adjusted basis was $10,000. Amend taxes After you received the land, no events occurred to increase or decrease your basis. Amend taxes If you sell the land for $12,000, you will have a $2,000 gain because you must use the donor's adjusted basis ($10,000) at the time of the gift as your basis to figure gain. Amend taxes If you sell the land for $7,000, you will have a $1,000 loss because you must use the FMV ($8,000) at the time of the gift as your basis to figure a loss. Amend taxes If the sales price is between $8,000 and $10,000, you have neither gain nor loss. Amend taxes For instance, if the sales price was $9,000 and you tried to figure a gain using the donor's adjusted basis ($10,000), you would get a $1,000 loss. Amend taxes If you then tried to figure a loss using the FMV ($8,000), you would get a $1,000 gain. Amend taxes Business property. Amend taxes   If you hold the gift as business property, your basis for figuring any depreciation, depletion, or amortization deduction is the same as the donor's adjusted basis plus or minus any required adjustments to basis while you hold the property. Amend taxes FMV Equal to or More Than Donor's Adjusted Basis If the FMV of the property is equal to or greater than the donor's adjusted basis, your basis is the donor's adjusted basis at the time you received the gift. Amend taxes Increase your basis by all or part of any gift tax paid, depending on the date of the gift. Amend taxes Also, for figuring gain or loss from a sale or other disposition of the property, or for figuring depreciation, depletion, or amortization deductions on business property, you must increase or decrease your basis by any required adjustments to basis while you held the property. Amend taxes See Adjusted Basis earlier. Amend taxes Gift received before 1977. Amend taxes   If you received a gift before 1977, increase your basis in the gift (the donor's adjusted basis) by any gift tax paid on it. Amend taxes However, do not increase your basis above the FMV of the gift at the time it was given to you. Amend taxes Example 1. Amend taxes You were given a house in 1976 with an FMV of $21,000. Amend taxes The donor's adjusted basis was $20,000. Amend taxes The donor paid a gift tax of $500. Amend taxes Your basis is $20,500, the donor's adjusted basis plus the gift tax paid. Amend taxes Example 2. Amend taxes If, in Example 1, the gift tax paid had been $1,500, your basis would be $21,000. Amend taxes This is the donor's adjusted basis plus the gift tax paid, limited to the FMV of the house at the time you received the gift. Amend taxes Gift received after 1976. Amend taxes   If you received a gift after 1976, increase your basis in the gift (the donor's adjusted basis) by the part of the gift tax paid on it that is due to the net increase in value of the gift. Amend taxes Figure the increase by multiplying the gift tax paid by a fraction. Amend taxes The numerator of the fraction is the net increase in value of the gift and the denominator is the amount of the gift. Amend taxes   The net increase in value of the gift is the FMV of the gift less the donor's adjusted basis. Amend taxes The amount of the gift is its value for gift tax purposes after reduction by any annual exclusion and marital or charitable deduction that applies to the gift. Amend taxes For information on the gift tax, see Publication 950, Introduction to Estate and Gift Taxes. Amend taxes Example. Amend taxes In 2010, you received a gift of property from your mother that had an FMV of $50,000. Amend taxes Her adjusted basis was $20,000. Amend taxes The amount of the gift for gift tax purposes was $37,000 ($50,000 minus the $13,000 annual exclusion). Amend taxes She paid a gift tax of $9,000. Amend taxes Your basis, $27,290, is figured as follows: Fair market value $50,000 Minus: Adjusted basis 20,000 Net increase in value $30,000 Gift tax paid $9,000 Multiplied by ($30,000 ÷ $37,000) . Amend taxes 81 Gift tax due to net increase in value $7,290 Adjusted basis of property to your mother 20,000 Your basis in the property $27,290 Inherited Property Special rules apply to property acquired from a decedent who died in 2010. Amend taxes See Publication 4895, Tax Treatment of Property Acquired From a Decedent Dying in 2010, for details. Amend taxes If you inherited property from a decedent who died before 2010, your basis in property you inherit from a decedent is generally one of the following. Amend taxes The FMV of the property at the date of the individual's death. Amend taxes The FMV on the alternate valuation date if the personal representative for the estate chooses to use alternate valuation. Amend taxes For information on the alternate valuation date, see the Instructions for Form 706. Amend taxes The value under the special-use valuation method for real property used in farming or a closely held business if chosen for estate tax purposes. Amend taxes This method is discussed later. Amend taxes The decedent's adjusted basis in land to the extent of the value excluded from the decedent's taxable estate as a qualified conservation easement. Amend taxes For information on a qualified conservation easement, see the Instructions for Form 706. Amend taxes If a federal estate tax return does not have to be filed, your basis in the inherited property is its appraised value at the date of death for state inheritance or transmission taxes. Amend taxes For more information, see the Instructions for Form 706. Amend taxes Appreciated property. Amend taxes   The above rule does not apply to appreciated property you receive from a decedent if you or your spouse originally gave the property to the decedent within 1 year before the decedent's death. Amend taxes Your basis in this property is the same as the decedent's adjusted basis in the property immediately before his or her death, rather than its FMV. Amend taxes Appreciated property is any property whose FMV on the day it was given to the decedent is more than its adjusted basis. Amend taxes Community Property In community property states (Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin), husband and wife are each usually considered to own half the community property. Amend taxes When either spouse dies, the total value of the community property, even the part belonging to the surviving spouse, generally becomes the basis of the entire property. Amend taxes For this rule to apply, at least half the value of the community property interest must be includable in the decedent's gross estate, whether or not the estate must file a return. Amend taxes For example, you and your spouse owned community property that had a basis of $80,000. Amend taxes When your spouse died, half the FMV of the community interest was includible in your spouse's estate. Amend taxes The FMV of the community interest was $100,000. Amend taxes The basis of your half of the property after the death of your spouse is $50,000 (half of the $100,000 FMV). Amend taxes The basis of the other half to your spouse's heirs is also $50,000. Amend taxes For more information on community property, see Publication 555, Community Property. Amend taxes Property Held by Surviving Tenant The following example explains the rule for the basis of property held by a surviving tenant in joint tenancy or tenancy by the entirety. Amend taxes Example. Amend taxes John and Jim owned, as joint tenants with right of survivorship, business property they purchased for $30,000. Amend taxes John furnished two-thirds of the purchase price and Jim furnished one-third. Amend taxes Depreciation deductions allowed before John's death were $12,000. Amend taxes Under local law, each had a half interest in the income from the property. Amend taxes At the date of John's death, the property had an FMV of $60,000, two-thirds of which is includable in John's estate. Amend taxes Jim figures his basis in the property at the date of John's death as follows: Interest Jim bought with his own funds—1/3 of $30,000 cost $10,000   Interest Jim received on John's death—2/3 of $60,000 FMV 40,000 $50,000 Minus: ½ of $12,000 depreciation before John's death 6,000 Jim's basis at the date of John's death $44,000 If Jim had not contributed any part of the purchase price, his basis at the date of John's death would be $54,000. Amend taxes This is figured by subtracting from the $60,000 FMV, the $6,000 depreciation allocated to Jim's half interest before the date of death. Amend taxes If under local law Jim had no interest in the income from the property and he contributed no part of the purchase price, his basis at John's death would be $60,000, the FMV of the property. Amend taxes Qualified Joint Interest Include one-half of the value of a qualified joint interest in the decedent's gross estate. Amend taxes It does not matter how much each spouse contributed to the purchase price. Amend taxes Also, it does not matter which spouse dies first. Amend taxes A qualified joint interest is any interest in property held by husband and wife as either of the following. Amend taxes Tenants by the entirety, or Joint tenants with right of survivorship if husband and wife are the only joint tenants. Amend taxes Basis. Amend taxes   As the surviving spouse, your basis in property you owned with your spouse as a qualified joint interest is the cost of your half of the property with certain adjustments. Amend taxes Decrease the cost by any deductions allowed to you for depreciation and depletion. Amend taxes Increase the reduced cost by your basis in the half you inherited. Amend taxes Farm or Closely Held Business Under certain conditions, when a person dies the executor or personal representative of that person's estate can choose to value the qualified real property on other than its FMV. Amend taxes If so, the executor or personal representative values the qualified real property based on its use as a farm or its use in a closely held business. Amend taxes If the executor or personal representative chooses this method of valuation for estate tax purposes, that value is the basis of the property for the heirs. Amend taxes Qualified heirs should be able to get the necessary value from the executor or personal representative of the estate. Amend taxes Special-use valuation. Amend taxes   If you are a qualified heir who received special-use valuation property, your basis in the property is the estate's or trust's basis in that property immediately before the distribution. Amend taxes Increase your basis by any gain recognized by the estate or trust because of post-death appreciation. Amend taxes Post-death appreciation is the property's FMV on the date of distribution minus the property's FMV either on the date of the individual's death or the alternate valuation date. Amend taxes Figure all FMVs without regard to the special-use valuation. Amend taxes   You can elect to increase your basis in special-use valuation property if it becomes subject to the additional estate tax. Amend taxes This tax is assessed if, within 10 years after the death of the decedent, you transfer the property to a person who is not a member of your family or the property stops being used as a farm or in a closely held business. Amend taxes   To increase your basis in the property, you must make an irrevocable election and pay interest on the additional estate tax figured from the date 9 months after the decedent's death until the date of the payment of the additional estate tax. Amend taxes If you meet these requirements, increase your basis in the property to its FMV on the date of the decedent's death or the alternate valuation date. Amend taxes The increase in your basis is considered to have occurred immediately before the event that results in the additional estate tax. Amend taxes   You make the election by filing with Form 706-A a statement that does all of the following. Amend taxes Contains your name, address, and taxpayer identification number and those of the estate; Identifies the election as an election under section 1016(c) of the Internal Revenue Code; Specifies the property for which the election is made; and Provides any additional information required by the Instructions for Form 706-A. Amend taxes   For more information, see the Instructions for Form 706 and the Instructions for Form 706-A. Amend taxes Property Changed to Business or Rental Use If you hold property for personal use and then change it to business use or use it to produce rent, you must figure its basis for depreciation. Amend taxes An example of changing property held for personal use to business use would be renting out your former main home. Amend taxes Basis for depreciation. Amend taxes   The basis for depreciation is the lesser of the following amounts. Amend taxes The FMV of the property on the date of the change, or Your adjusted basis on the date of the change. Amend taxes Example. Amend taxes Several years ago you paid $160,000 to have your home built on a lot that cost $25,000. Amend taxes You paid $20,000 for permanent improvements to the house and claimed a $2,000 casualty loss deduction for damage to the house before changing the property to rental use last year. Amend taxes Because land is not depreciable, you include only the cost of the house when figuring the basis for depreciation. Amend taxes Your adjusted basis in the house when you changed its use was $178,000 ($160,000 + $20,000 − $2,000). Amend taxes On the same date, your property had an FMV of $180,000, of which $15,000 was for the land and $165,000 was for the house. Amend taxes The basis for figuring depreciation on the house is its FMV on the date of change ($165,000) because it is less than your adjusted basis ($178,000). Amend taxes Sale of property. Amend taxes   If you later sell or dispose of property changed to business or rental use, the basis of the property you use will depend on whether you are figuring gain or loss. Amend taxes Gain. Amend taxes   The basis for figuring a gain is your adjusted basis when you sell the property. Amend taxes Example. Amend taxes Assume the same facts as in the previous example except that you sell the property at a gain after being allowed depreciation deductions of $37,500. Amend taxes Your adjusted basis for figuring gain is $165,500 ($178,000 + $25,000 (land) − $37,500). Amend taxes Loss. Amend taxes   Figure the basis for a loss starting with the smaller of your adjusted basis or the FMV of the property at the time of the change to business or rental use. Amend taxes Then adjust this amount for the period after the change in the property's use, as discussed earlier under Adjusted Basis, to arrive at a basis for loss. Amend taxes Example. Amend taxes Assume the same facts as in the previous example, except that you sell the property at a loss after being allowed depreciation deductions of $37,500. Amend taxes In this case, you would start with the FMV on the date of the change to rental use ($180,000) because it is less than the adjusted basis of $203,000 ($178,000 + $25,000) on that date. Amend taxes Reduce that amount ($180,000) by the depreciation deductions to arrive at a basis for loss of $142,500 ($180,000 − $37,500). Amend taxes How To Get Tax Help You can get help with unresolved tax issues, order free publications and forms, ask tax questions, and get more information from the IRS in several ways. Amend taxes By selecting the method that is best for you, you will have quick and easy access to tax help. Amend taxes Contacting your Taxpayer Advocate. Amend taxes   The Taxpayer Advocate Service (TAS) is an independent organization within the IRS. Amend taxes We help taxpayers who are experiencing economic harm, such as not being able to provide necessities like housing, transportation, or food; taxpayers who are seeking help in resolving tax problems with the IRS; and those who believe that an IRS system or procedure is not working as it should. Amend taxes Here are seven things every taxpayer should know about TAS. Amend taxes TAS is your voice at the IRS. Amend taxes Our service is free, confidential, and tailored to meet your needs. Amend taxes You may be eligible for our help if you have tried to resolve your tax problem through normal IRS channels and have gotten nowhere, or you believe an IRS procedure just isn't working as it should. Amend taxes We help taxpayers whose problems are causing financial difficulty or significant cost, including the cost of professional representation. Amend taxes This includes businesses as well as individuals. Amend taxes Our employees know the IRS and how to navigate it. Amend taxes If you qualify for our help, we'll assign your case to an advocate who will listen to your problem, help you understand what needs to be done to resolve it, and stay with you every step of the way until your problem is resolved. Amend taxes We have at least one local taxpayer advocate in every state, the District of Columbia, and Puerto Rico. Amend taxes You can call your local advocate, whose number is in your phone book, in Publication 1546, Taxpayer Advocate Service—Your Voice at the IRS, and on our website at www. Amend taxes irs. Amend taxes gov/advocate. Amend taxes You can also call our toll-free line at 1-877-777-4778 or TTY/TDD 1-800-829-4059. Amend taxes You can learn about your rights and responsibilities as a taxpayer by visiting our online tax toolkit at www. Amend taxes taxtoolkit. Amend taxes irs. Amend taxes gov. Amend taxes You can get updates on hot tax topics by visiting our YouTube channel at www. Amend taxes youtube. Amend taxes com/tasnta and our Facebook page at www. Amend taxes facebook. Amend taxes com/YourVoiceAtIRS, or by following our tweets at www. Amend taxes twitter. Amend taxes com/YourVoiceAtIRS. Amend taxes Low Income Taxpayer Clinics (LITCs). Amend taxes   The Low Income Taxpayer Clinic program serves individuals who have a problem with the IRS and whose income is below a certain level. Amend taxes LITCs are independent from the IRS. Amend taxes Most LITCs can provide representation before the IRS or in court on audits, tax collection disputes, and other issues for free or a small fee. Amend taxes If an individual's native language is not English, some clinics can provide multilingual information about taxpayer rights and responsibilities. Amend taxes For more information, see Publication 4134, Low Income Taxpayer Clinic List. Amend taxes This publication is available at IRS. Amend taxes gov, by calling 1-800-TAX-FORM (1-800-829-3676), or at your local IRS office. Amend taxes Free tax services. Amend taxes   Publication 910, IRS Guide to Free Tax Services, is your guide to IRS services and resources. Amend taxes Learn about free tax information from the IRS, including publications, services, and education and assistance programs. Amend taxes The publication also has an index of over 100 TeleTax topics (recorded tax information) you can listen to on the telephone. Amend taxes The majority of the information and services listed in this publication are available to you free of charge. Amend taxes If there is a fee associated with a resource or service, it is listed in the publication. Amend taxes   Accessible versions of IRS published products are available on request in a variety of alternative formats for people with d