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

Did Not File 2012 Taxes

E File 1040x FreeH Rblock ComFiling A Tax Amendment OnlineState Income Tax FormsH&rblockHr Block Free Tax FilingI Didn T File 2011 Taxes1040ez On LineCan I File My Back Taxes Online FreePrevious Year Tax Forms1040ez1040 Easy Form 2012File An Amended Tax Return OnlineHow To Refile Your TaxesFree Tax Filing For College Students1040ez Tax ReturnFile 2010 Taxes Online TurbotaxFree 2012 Tax HelpRefile Taxes1040ez 2012 FormAmend Your TaxesH&r Block's Free FileFree State Tax Preparation SoftwareHrblockonline1040xFiling 1040x InstructionsAarp Free Tax Preparation2012 Income Tax Forms 1040ezFile Your State Taxes Online For Free10 40 Ez Form 2012File My 2012 Taxes Free OnlineCan I Amend My 2009 Tax ReturnAmended Tax Return 2010Can You Amend A Tax Return1040ez 2012 Tax FormCan You E File An Amended 1040xWhen Can I File An Amended Tax Return For 2013Where Can I File My 2011 Taxes For FreeFiling Taxes As UnemployedFree State Tax Filing Online State Return

Did Not File 2012 Taxes

Did not file 2012 taxes Index A Additional Medicare Tax, Reminders, Additional Medicare Tax withholding. Did not file 2012 taxes Aliens, nonresident, Withholding income taxes on the wages of nonresident alien employees. Did not file 2012 taxes , Withholding adjustment for nonresident alien employees. Did not file 2012 taxes Assistance (see Tax help) C COBRA premium assistance credit, Reminders COBRA Premium Assistance Credit, COBRA premium assistance credit. Did not file 2012 taxes Commodity wages, Commodity wages. Did not file 2012 taxes Crew leaders, Crew Leaders, 10. Did not file 2012 taxes Federal Unemployment (FUTA) Tax D Deposit Penalties, Deposit Penalties Deposit rules Electronic funds transfer, 7. Did not file 2012 taxes Depositing Taxes Lookback period, Lookback period. Did not file 2012 taxes Differential wage payments, Reminders Disregarded entities, Reminders E Electronic deposits, Electronic deposit requirement. Did not file 2012 taxes Electronic payment, Reminders Electronic reporting, Calendar Employee defined, 2. Did not file 2012 taxes Who Are Employees? Employer identification number (EIN), Employer identification number (EIN). Did not file 2012 taxes Employers of farmworkers, 2. Did not file 2012 taxes Who Are Employees? Exemption from withholding, Exemption from federal income tax withholding. Did not file 2012 taxes F Farmworkers Crew leaders, Crew Leaders Defined, 2. Did not file 2012 taxes Who Are Employees? Federal unemployment (FUTA) taxes, 10. Did not file 2012 taxes Federal Unemployment (FUTA) Tax Forms 843, Form 843. Did not file 2012 taxes 940, 10. Did not file 2012 taxes Federal Unemployment (FUTA) Tax 943, 8. Did not file 2012 taxes Form 943 943-X, Prior Year Adjustments I-9, Reminders W-2, Filing corrections to Forms W-2 and W-3. Did not file 2012 taxes W-4, Reminders, Form W-4. Did not file 2012 taxes W-4(SP), Reminders, Form W-4. Did not file 2012 taxes H H-2A visa holders, Compensation paid to H-2A visa holders. Did not file 2012 taxes Household employees Employment tax withholding, Household employees. Did not file 2012 taxes I Income tax withholding How to figure, How To Figure Federal Income Tax Withholding Percentage method, 13. Did not file 2012 taxes Federal Income Tax Withholding Methods Wage bracket method, 13. Did not file 2012 taxes Federal Income Tax Withholding Methods Who must withhold, 5. Did not file 2012 taxes Federal Income Tax Withholding Independent contractor, 2. Did not file 2012 taxes Who Are Employees? L Lookback period, Lookback period. Did not file 2012 taxes N Noncash wages, Commodity wages. Did not file 2012 taxes P Penalties, Deposit Penalties Prior year adjustments, Prior Year Adjustments Publications (see Tax help) Q Qualified subchapter S subsidiaries (QSubs), Reminders R Reconciling Forms W-2, W-3, and 943, 11. Did not file 2012 taxes Reconciling Wage Reporting Forms Reconciling wage reporting forms, 11. Did not file 2012 taxes Reconciling Wage Reporting Forms S Share farmers, Share farmers. Did not file 2012 taxes Social security and Medicare withholding, 4. Did not file 2012 taxes Social Security and Medicare Taxes Social security number (SSN), Social security number (SSN). Did not file 2012 taxes Spouses who own and operate a business together , Business Owned and Operated by Spouses Supplemental wages, Supplemental wages. Did not file 2012 taxes T Tax help, How To Get Tax Help Taxpayer identification number, 1. Did not file 2012 taxes Taxpayer Identification Numbers Trust fund recovery penalty, Trust fund recovery penalty. Did not file 2012 taxes TTY/TDD information, How To Get Tax Help W Withholding Income tax, 5. Did not file 2012 taxes Federal Income Tax Withholding Nonresident aliens, Withholding adjustment for nonresident alien employees. Did not file 2012 taxes Supplemental wages, Supplemental wages. Did not file 2012 taxes Prev  Up     Home   More Online Publications
Print - Click this link to Print this page

Law Enforcement Assistance Pilot Program on Identity Theft Activity Involving the IRS

As part of its comprehensive identity theft strategy, the IRS is expanding the law enforcement assistance pilot program designed to help law enforcement obtain tax return data vital to their local efforts in investigating and prosecuting specific cases of identity theft. In addition to the initial State of Florida, this pilot program is expanding to work with law enforcement in eight additional states: Alabama, California, Georgia, New Jersey, New York, Oklahoma, Pennsylvania and Texas.

The IRS launched the initial pilot in Florida in April of 2012.  Over 750 waiver requests have been received through October from roughly 50 state and local law enforcement agencies in Florida participating in the pilot. 

Under the pilot program, state and local law enforcement officials with evidence of identity theft involving fraudulently filed federal tax returns will be able to have identity theft victims complete a special IRS disclosure form. Taxpayers must give their permission for the IRS to provide law enforcement with the returns submitted using their Social Security number. Law enforcement officials will need to contact the identity theft victims in order to request and secure the victims' consent for disclosure of the records. In certain instances, the IRS will assist law enforcement in locating taxpayers and soliciting their consent.

Law enforcement would then submit a disclosure authorization form, which the IRS created solely for use by victims of identity theft for this pilot program, to the Criminal Investigation (CI) Division of the IRS, along with a copy of the police report and the IRS Identity Theft Affidavit if available. It is important that identity theft victims still submit the original copy of the IRS Identity Theft Affidavit to the IRS according to the instructions on the back of the form that fit their specific circumstances.

Federal law imposes restrictions on sharing of taxpayer information, including information that can be shared with state and local law enforcement.  This program allows taxpayers the option to permit information to be shared with state and local law enforcement specifically to assist law enforcement officials with their efforts in pursuing identity theft perpetrators.  During this expanded pilot program, the IRS will process the disclosure forms received and forward the documentation to the law enforcement officer who requested the documents. The documents will not be sent directly to the taxpayer. However, the IRS will continue to work directly with taxpayers to resolve their tax accounts as quickly as possible.

Law enforcement in the nine states in this pilot program who are interested in working with the IRS should contact their local IRS Criminal Investigation field office.

Following the pilot, the IRS will carefully assess the results and performance before deciding on how to proceed with the program.

The IRS comprehensive identity theft strategy comprises a dual effort, focusing both on fraud prevention and victim assistance. On the prevention side, this includes implementing new processes for handling returns, new filters to detect fraud, new initiatives to partner with stakeholders and a continued commitment to investigate the criminals who perpetrate these crimes. As for victim assistance, the IRS is working to accelerate case resolution, provide more training for our employees who assist victims of identity theft, and increase outreach to and education of taxpayers so they can prevent and resolve tax-related identity theft issues quickly.

Taxpayers looking for additional information can consult the Taxpayer Guide to Identity Theft or the IRS Identity Theft Protection page on the IRS website.

Page Last Reviewed or Updated: 06-Dec-2013

The Did Not File 2012 Taxes

Did not file 2012 taxes Publication 542 - Main Content Table of Contents Businesses Taxed as CorporationsPersonal services. Did not file 2012 taxes Employee-owners. Did not file 2012 taxes Other rules. Did not file 2012 taxes Other rules. Did not file 2012 taxes Property Exchanged for StockNonqualified preferred stock. Did not file 2012 taxes Liabilities. Did not file 2012 taxes Election to reduce basis. Did not file 2012 taxes Capital Contributions Filing and Paying Income TaxesIncome Tax Return Penalties Estimated Tax U. Did not file 2012 taxes S. Did not file 2012 taxes Real Property Interest Accounting MethodsSection 481(a) adjustment. Did not file 2012 taxes Accounting Periods Recordkeeping Income, Deductions, and Special ProvisionsCosts of Going Into Business Related Persons Income From Qualifying Shipping Activities Election to Expense Qualified Refinery Property Deduction to Comply With EPA Sulfur Regulations Energy-Efficient Commercial Building Property Deduction Corporate Preference Items Dividends-Received Deduction Extraordinary Dividends Below-Market Loans Charitable Contributions Capital Losses Net Operating Losses At-Risk Limits Passive Activity Limits Figuring TaxTax Rate Schedule Alternative Minimum Tax (AMT) Credits Recapture Taxes Accumulated Earnings Tax Distributions to ShareholdersMoney or Property Distributions Distributions of Stock or Stock Rights Constructive Distributions Reporting Dividends and Other Distributions How To Get Tax Help Businesses Taxed as Corporations The rules you must use to determine whether a business is taxed as a corporation changed for businesses formed after 1996. Did not file 2012 taxes Business formed before 1997. Did not file 2012 taxes   A business formed before 1997 and taxed as a corporation under the old rules will generally continue to be taxed as a corporation. Did not file 2012 taxes Business formed after 1996. Did not file 2012 taxes   The following businesses formed after 1996 are taxed as corporations. Did not file 2012 taxes A business formed under a federal or state law that refers to it as a corporation, body corporate, or body politic. Did not file 2012 taxes A business formed under a state law that refers to it as a joint-stock company or joint-stock association. Did not file 2012 taxes An insurance company. Did not file 2012 taxes Certain banks. Did not file 2012 taxes A business wholly owned by a state or local government. Did not file 2012 taxes A business specifically required to be taxed as a corporation by the Internal Revenue Code (for example, certain publicly traded partnerships). Did not file 2012 taxes Certain foreign businesses. Did not file 2012 taxes Any other business that elects to be taxed as a corporation. Did not file 2012 taxes For example, a limited liability company (LLC) can elect to be treated as an association taxable as a corporation by filing Form 8832, Entity Classification Election. Did not file 2012 taxes For more information about LLCs, see Publication 3402, Taxation of Limited Liability Companies. Did not file 2012 taxes S corporations. Did not file 2012 taxes   Some corporations may meet the qualifications for electing to be S corporations. Did not file 2012 taxes For information on S corporations, see the instructions for Form 1120S, U. Did not file 2012 taxes S. Did not file 2012 taxes Income Tax Return for an S Corporation. Did not file 2012 taxes Personal service corporations. Did not file 2012 taxes   A corporation is a personal service corporation if it meets all of the following requirements. Did not file 2012 taxes Its principal activity during the “testing period” is performing personal services (defined later). Did not file 2012 taxes Generally, the testing period for any tax year is the prior tax year. Did not file 2012 taxes If the corporation has just been formed, the testing period begins on the first day of its tax year and ends on the earlier of: The last day of its tax year, or The last day of the calendar year in which its tax year begins. Did not file 2012 taxes Its employee-owners substantially perform the services in (1), above. Did not file 2012 taxes This requirement is met if more than 20% of the corporation's compensation cost for its activities of performing personal services during the testing period is for personal services performed by employee-owners. Did not file 2012 taxes Its employee-owners own more than 10% of the fair market value of its outstanding stock on the last day of the testing period. Did not file 2012 taxes Personal services. Did not file 2012 taxes   Personal services include any activity performed in the fields of accounting, actuarial science, architecture, consulting, engineering, health (including veterinary services), law, and the performing arts. Did not file 2012 taxes Employee-owners. Did not file 2012 taxes   A person is an employee-owner of a personal service corporation if both of the following apply. Did not file 2012 taxes He or she is an employee of the corporation or performs personal services for, or on behalf of, the corporation (even if he or she is an independent contractor for other purposes) on any day of the testing period. Did not file 2012 taxes He or she owns any stock in the corporation at any time during the testing period. Did not file 2012 taxes Other rules. Did not file 2012 taxes   For other rules that apply to personal service corporations see Accounting Periods, later. Did not file 2012 taxes Closely held corporations. Did not file 2012 taxes   A corporation is closely held if all of the following apply. Did not file 2012 taxes It is not a personal service corporation. Did not file 2012 taxes At any time during the last half of the tax year, more than 50% of the value of its outstanding stock is, directly or indirectly, owned by or for five or fewer individuals. Did not file 2012 taxes “Individual” includes certain trusts and private foundations. Did not file 2012 taxes Other rules. Did not file 2012 taxes   For the at-risk rules that apply to closely held corporations, seeAt-Risk Limits, later. Did not file 2012 taxes Property Exchanged for Stock If you transfer property (or money and property) to a corporation in exchange for stock in that corporation (other than nonqualified preferred stock, described later), and immediately afterward you are in control of the corporation, the exchange is usually not taxable. Did not file 2012 taxes This rule applies both to individuals and to groups who transfer property to a corporation. Did not file 2012 taxes It also applies whether the corporation is being formed or is already operating. Did not file 2012 taxes It does not apply in the following situations. Did not file 2012 taxes The corporation is an investment company. Did not file 2012 taxes You transfer the property in a bankruptcy or similar proceeding in exchange for stock used to pay creditors. Did not file 2012 taxes The stock is received in exchange for the corporation's debt (other than a security) or for interest on the corporation's debt (including a security) that accrued while you held the debt. Did not file 2012 taxes Both the corporation and any person involved in a nontaxable exchange of property for stock must attach to their income tax returns a complete statement of all facts pertinent to the exchange. Did not file 2012 taxes For more information, see section 1. Did not file 2012 taxes 351-3 of the Regulations. Did not file 2012 taxes Control of a corporation. Did not file 2012 taxes   To be in control of a corporation, you or your group of transferors must own, immediately after the exchange, at least 80% of the total combined voting power of all classes of stock entitled to vote and at least 80% of the outstanding shares of each class of nonvoting stock. Did not file 2012 taxes Example 1. Did not file 2012 taxes You and Bill Jones buy property for $100,000. Did not file 2012 taxes You both organize a corporation when the property has a fair market value of $300,000. Did not file 2012 taxes You transfer the property to the corporation for all its authorized capital stock, which has a par value of $300,000. Did not file 2012 taxes No gain is recognized by you, Bill, or the corporation. Did not file 2012 taxes Example 2. Did not file 2012 taxes You and Bill transfer the property with a basis of $100,000 to a corporation in exchange for stock with a fair market value of $300,000. Did not file 2012 taxes This represents only 75% of each class of stock of the corporation. Did not file 2012 taxes The other 25% was already issued to someone else. Did not file 2012 taxes You and Bill recognize a taxable gain of $200,000 on the transaction. Did not file 2012 taxes Services rendered. Did not file 2012 taxes   The term property does not include services rendered or to be rendered to the issuing corporation. Did not file 2012 taxes The value of stock received for services is income to the recipient. Did not file 2012 taxes Example. Did not file 2012 taxes You transfer property worth $35,000 and render services valued at $3,000 to a corporation in exchange for stock valued at $38,000. Did not file 2012 taxes Right after the exchange, you own 85% of the outstanding stock. Did not file 2012 taxes No gain is recognized on the exchange of property. Did not file 2012 taxes However, you recognize ordinary income of $3,000 as payment for services you rendered to the corporation. Did not file 2012 taxes Property of relatively small value. Did not file 2012 taxes   The term property does not include property of a relatively small value when it is compared to the value of stock and securities already owned or to be received for services by the transferor if the main purpose of the transfer is to qualify for the nonrecognition of gain or loss by other transferors. Did not file 2012 taxes   Property transferred will not be considered to be of relatively small value if its fair market value is at least 10% of the fair market value of the stock and securities already owned or to be received for services by the transferor. Did not file 2012 taxes Stock received in disproportion to property transferred. Did not file 2012 taxes   If a group of transferors exchange property for corporate stock, each transferor does not have to receive stock in proportion to his or her interest in the property transferred. Did not file 2012 taxes If a disproportionate transfer takes place, it will be treated for tax purposes in accordance with its true nature. Did not file 2012 taxes It may be treated as if the stock were first received in proportion and then some of it used to make gifts, pay compensation for services, or satisfy the transferor's obligations. Did not file 2012 taxes Money or other property received. Did not file 2012 taxes   If, in an otherwise nontaxable exchange of property for corporate stock, you also receive money or property other than stock, you may have to recognize gain. Did not file 2012 taxes You must recognize gain only up to the amount of money plus the fair market value of the other property you receive. Did not file 2012 taxes The rules for figuring the recognized gain in this situation generally follow those for a partially nontaxable exchange discussed in Publication 544 under Like-Kind Exchanges. Did not file 2012 taxes If the property you give up includes depreciable property, the recognized gain may have to be reported as ordinary income from depreciation. Did not file 2012 taxes See chapter 3 of Publication 544. Did not file 2012 taxes No loss is recognized. Did not file 2012 taxes Nonqualified preferred stock. Did not file 2012 taxes   Nonqualified preferred stock is treated as property other than stock. Did not file 2012 taxes Generally, it is preferred stock with any of the following features. Did not file 2012 taxes The holder has the right to require the issuer or a related person to redeem or buy the stock. Did not file 2012 taxes The issuer or a related person is required to redeem or buy the stock. Did not file 2012 taxes The issuer or a related person has the right to redeem or buy the stock and, on the issue date, it is more likely than not that the right will be exercised. Did not file 2012 taxes The dividend rate on the stock varies with reference to interest rates, commodity prices, or similar indices. Did not file 2012 taxes For a detailed definition of nonqualified preferred stock, see section 351(g)(2) of the Internal Revenue Code. Did not file 2012 taxes Liabilities. Did not file 2012 taxes   If the corporation assumes your liabilities, the exchange generally is not treated as if you received money or other property. Did not file 2012 taxes There are two exceptions to this treatment. Did not file 2012 taxes If the liabilities the corporation assumes are more than your adjusted basis in the property you transfer, gain is recognized up to the difference. Did not file 2012 taxes However, if the liabilities assumed give rise to a deduction when paid, such as a trade account payable or interest, no gain is recognized. Did not file 2012 taxes If there is no good business reason for the corporation to assume your liabilities, or if your main purpose in the exchange is to avoid federal income tax, the assumption is treated as if you received money in the amount of the liabilities. Did not file 2012 taxes For more information on the assumption of liabilities, see section 357(d) of the Internal Revenue Code. Did not file 2012 taxes Example. Did not file 2012 taxes You transfer property to a corporation for stock. Did not file 2012 taxes Immediately after the transfer, you control the corporation. Did not file 2012 taxes You also receive $10,000 in the exchange. Did not file 2012 taxes Your adjusted basis in the transferred property is $20,000. Did not file 2012 taxes The stock you receive has a fair market value (FMV) of $16,000. Did not file 2012 taxes The corporation also assumes a $5,000 mortgage on the property for which you are personally liable. Did not file 2012 taxes Gain is realized as follows. Did not file 2012 taxes FMV of stock received $16,000 Cash received 10,000 Liability assumed by corporation 5,000 Total received $31,000 Minus: Adjusted basis of property transferred 20,000 Realized gain $11,000   The liability assumed is not treated as money or other property. Did not file 2012 taxes The recognized gain is limited to $10,000, the cash received. Did not file 2012 taxes Loss on exchange. Did not file 2012 taxes   If you have a loss from an exchange and own, directly or indirectly, more than 50% of the corporation's stock, you cannot deduct the loss. Did not file 2012 taxes For more information, see Nondeductible Loss under Sales and Exchanges Between Related Persons in chapter 2 of Publication 544. Did not file 2012 taxes Basis of stock or other property received. Did not file 2012 taxes   The basis of the stock you receive is generally the adjusted basis of the property you transfer. Did not file 2012 taxes Increase this amount by any amount treated as a dividend, plus any gain recognized on the exchange. Did not file 2012 taxes Decrease this amount by any cash you received, the fair market value of any other property you received, and any loss recognized on the exchange. Did not file 2012 taxes Also decrease this amount by the amount of any liability the corporation or another party to the exchange assumed from you, unless payment of the liability gives rise to a deduction when paid. Did not file 2012 taxes    Further decreases may be required when the corporation or another party to the exchange assumes from you a liability that gives rise to a deduction when paid, if the basis of the stock would otherwise be higher than its fair market value on the date of the exchange. Did not file 2012 taxes This rule does not apply if the entity assuming the liability acquired either substantially all of the assets or the trade or business with which the liability is associated. Did not file 2012 taxes The basis of any other property you receive is its fair market value on the date of the trade. Did not file 2012 taxes Basis of property transferred. Did not file 2012 taxes   A corporation that receives property from you in exchange for its stock generally has the same basis you had in the property, increased by any gain you recognized on the exchange. Did not file 2012 taxes However, the increase for the gain recognized may be limited. Did not file 2012 taxes For more information, see section 362 of the Internal Revenue Code. Did not file 2012 taxes Election to reduce basis. Did not file 2012 taxes   In a section 351 transaction, if the adjusted basis of the property transferred exceeds the property's fair market value, the transferor and transferee may make an irrevocable election to treat the basis of the stock received by the transferor as having a basis equal to the fair market value of the property transferred. Did not file 2012 taxes The transferor and transferee make this election by attaching a statement to their tax returns filed by the due date (including extensions) for the tax year in which the transaction occurred. Did not file 2012 taxes However, if the transferor makes the election by including the certification provided in Notice 2005-70, 2005-41, I. Did not file 2012 taxes R. Did not file 2012 taxes B. Did not file 2012 taxes 694, on or with its tax return filed by the due date (including extensions), then no election need be made by the transferee. Did not file 2012 taxes    For more information on making this election, see section 362(e)(2)(C) of the Internal Revenue Code, and Notice 2005-70. Did not file 2012 taxes Capital Contributions This section explains the tax treatment of contributions from shareholders and nonshareholders. Did not file 2012 taxes Paid-in capital. Did not file 2012 taxes   Contributions to the capital of a corporation, whether or not by shareholders, are paid-in capital. Did not file 2012 taxes These contributions are not taxable to the corporation. Did not file 2012 taxes Basis. Did not file 2012 taxes   The corporation's basis of property contributed to capital by a shareholder is the same as the basis the shareholder had in the property, increased by any gain the shareholder recognized on the exchange. Did not file 2012 taxes However, the increase for the gain recognized may be limited. Did not file 2012 taxes For more information, see Basis of property transferred, above, and section 362 of the Internal Revenue Code. Did not file 2012 taxes   The basis of property contributed to capital by a person other than a shareholder is zero. Did not file 2012 taxes   If a corporation receives a cash contribution from a person other than a shareholder, the corporation must reduce the basis of any property acquired with the contribution during the 12-month period beginning on the day it received the contribution by the amount of the contribution. Did not file 2012 taxes If the amount contributed is more than the cost of the property acquired, then reduce, but not below zero, the basis of the other properties held by the corporation on the last day of the 12-month period in the following order. Did not file 2012 taxes Depreciable property. Did not file 2012 taxes Amortizable property. Did not file 2012 taxes Property subject to cost depletion but not to percentage depletion. Did not file 2012 taxes All other remaining properties. Did not file 2012 taxes   Reduce the basis of property in each category to zero before going on to the next category. Did not file 2012 taxes   There may be more than one piece of property in each category. Did not file 2012 taxes Base the reduction of the basis of each property on the following ratio:   Basis of each piece of property   Bases of all properties (within that category) If the corporation wishes to make this adjustment in some other way, it must get IRS approval. Did not file 2012 taxes The corporation files a request for approval with its income tax return for the tax year in which it receives the contribution. Did not file 2012 taxes Filing and Paying Income Taxes The federal income tax is a pay-as-you-go tax. Did not file 2012 taxes A corporation generally must make estimated tax payments as it earns or receives income during its tax year. Did not file 2012 taxes After the end of the year, the corporation must file an income tax return. Did not file 2012 taxes This section will help you determine when and how to pay and file corporate income taxes. Did not file 2012 taxes For certain corporations affected by Presidentially declared disasters such as hurricanes, the due dates for filing returns, paying taxes, and performing other time-sensitive acts may be extended. Did not file 2012 taxes The IRS may also forgive the interest and penalties on any underpaid tax for the length of any extension. Did not file 2012 taxes For more information, visit www. Did not file 2012 taxes irs. Did not file 2012 taxes gov/newsroom/article/0,,id=108362. Did not file 2012 taxes 00. Did not file 2012 taxes Income Tax Return This section will help you determine when and how to report a corporation's income tax. Did not file 2012 taxes Who must file. Did not file 2012 taxes   Unless exempt under section 501 of the Internal Revenue Code, all domestic corporations in existence for any part of a tax year (including corporations in bankruptcy) must file an income tax return whether or not they have taxable income. Did not file 2012 taxes Which form to file. Did not file 2012 taxes   A corporation generally must file Form 1120, U. Did not file 2012 taxes S. Did not file 2012 taxes Corporation Income Tax Return, to report its income, gains, losses, deductions, credits, and to figure its income tax liability. Did not file 2012 taxes Certain organizations and entities must file special returns. Did not file 2012 taxes For more information, see Special Returns for Certain Organizations, in the Instructions for Form 1120. Did not file 2012 taxes Electronic filing. Did not file 2012 taxes   Corporations can generally electronically file (e-file) Form 1120 and certain related forms, schedules, and attachments. Did not file 2012 taxes Certain corporations with total assets of $10 million or more, that file at least 250 returns a year must e-file Form 1120. Did not file 2012 taxes However, in certain instances, these corporations can request a waiver. Did not file 2012 taxes For more information regarding electronic filing, visit www. Did not file 2012 taxes irs. Did not file 2012 taxes gov/efile. Did not file 2012 taxes When to file. Did not file 2012 taxes   Generally, a corporation must file its income tax return by the 15th day of the 3rd month after the end of its tax year. Did not file 2012 taxes A new corporation filing a short-period return must generally file by the 15th day of the 3rd month after the short period ends. Did not file 2012 taxes A corporation that has dissolved must generally file by the 15th day of the 3rd month after the date it dissolved. Did not file 2012 taxes Example 1. Did not file 2012 taxes A corporation's tax year ends December 31. Did not file 2012 taxes It must file its income tax return by March 15th. Did not file 2012 taxes Example 2. Did not file 2012 taxes A corporation's tax year ends June 30. Did not file 2012 taxes It must file its income tax return by September 15th. Did not file 2012 taxes   If the due date falls on a Saturday, Sunday, or legal holiday, the due date is extended to the next business day. Did not file 2012 taxes Extension of time to file. Did not file 2012 taxes   File Form 7004, Application for Automatic Extension of Time To File Certain Business Income Tax, Information and Other Returns, to request an extension of time to file a corporation income tax return. Did not file 2012 taxes The IRS will grant the extension if you complete the form properly, file it, and pay any tax due by the original due date for the return. Did not file 2012 taxes   Form 7004 does not extend the time for paying the tax due on the return. Did not file 2012 taxes Interest, and possibly penalties, will be charged on any part of the final tax due not shown as a balance due on Form 7004. Did not file 2012 taxes The interest is figured from the original due date of the return to the date of payment. Did not file 2012 taxes   For more information, see the instructions for Form 7004. Did not file 2012 taxes How to pay your taxes. Did not file 2012 taxes   A corporation must pay its tax due in full no later than the 15th day of the 3rd month after the end of its tax year. Did not file 2012 taxes Electronic Federal Tax Payment System (EFTPS). Did not file 2012 taxes   Corporations generally must use EFTPS to make deposits of all tax liabilities (including social security, Medicare, withheld income, excise, and corporate income taxes). Did not file 2012 taxes For more information on EFTPS and enrollment, visit www. Did not file 2012 taxes eftps. Did not file 2012 taxes gov or call 1-800-555-4477. Did not file 2012 taxes Also see Publication 966, The Secure Way to Pay Your Federal Taxes. Did not file 2012 taxes Note. Did not file 2012 taxes Forms 8109 and 8109-B, Federal Tax Deposit Coupon, can no longer be used to make federal tax deposits. Did not file 2012 taxes Penalties Generally, if the corporation receives a notice about interest and penalties after it files its return, send the IRS an explanation and we will determine if the corporation meets reasonable-cause criteria. Did not file 2012 taxes Do not attach an explanation when the corporation's return is filed. Did not file 2012 taxes See the instructions for your income tax return. Did not file 2012 taxes Late filing of return. Did not file 2012 taxes    A corporation that does not file its tax return by the due date, including extensions, may be penalized 5% of the unpaid tax for each month or part of a month the return is late, up to a maximum of 25% of the unpaid tax. Did not file 2012 taxes If the corporation is charged a penalty for late payment of tax (discussed next) for the same period of time, the penalty for late filing is reduced by the amount of the penalty for late payment. Did not file 2012 taxes The minimum penalty for a return that is over 60 days late is the smaller of the tax due or $100. Did not file 2012 taxes The penalty will not be imposed if the corporation can show the failure to file on time was due to a reasonable cause. Did not file 2012 taxes Late payment of tax. Did not file 2012 taxes    A corporation that does not pay the tax when due may be penalized ½ of 1% of the unpaid tax for each month or part of a month the tax is not paid, up to a maximum of 25% of the unpaid tax. Did not file 2012 taxes The penalty will not be imposed if the corporation can show that the failure to pay on time was due to a reasonable cause. Did not file 2012 taxes Trust fund recovery penalty. Did not file 2012 taxes   If income, social security, and Medicare taxes that a corporation must withhold from employee wages are not withheld or are not deposited or paid to the United States Treasury, the trust fund recovery penalty may apply. Did not file 2012 taxes The penalty is the full amount of the unpaid trust fund tax. Did not file 2012 taxes This penalty may apply to you if these unpaid taxes cannot be immediately collected from the business. Did not file 2012 taxes   The trust fund recovery penalty may be imposed on all persons who are determined by the IRS to be responsible for collecting, accounting for, and paying these taxes, and who acted willfully in not doing so. Did not file 2012 taxes   A responsible person can be an officer or employee of a corporation, an accountant, or a volunteer director/trustee. Did not file 2012 taxes A responsible person also may include one who signs checks for the corporation or otherwise has authority to cause the spending of business funds. Did not file 2012 taxes   Willfully means voluntarily, consciously, and intentionally. Did not file 2012 taxes A responsible person acts willfully if the person knows the required actions are not taking place. Did not file 2012 taxes   For more information on withholding and paying these taxes, see Publication 15 (Circular E), Employer's Tax Guide, and Publication 51, (Circular A), Agricultural Employer's Tax Guide. Did not file 2012 taxes Other penalties. Did not file 2012 taxes   Other penalties can be imposed for negligence, substantial understatement of tax, reportable transaction understatements, and fraud. Did not file 2012 taxes See sections 6662, 6662A, and 6663 of the Internal Revenue Code. Did not file 2012 taxes Estimated Tax Generally, a corporation must make installment payments if it expects its estimated tax for the year to be $500 or more. Did not file 2012 taxes If the corporation does not pay the installments when they are due, it could be subject to an underpayment penalty. Did not file 2012 taxes This section will explain how to avoid this penalty. Did not file 2012 taxes When to pay estimated tax. Did not file 2012 taxes   Installment payments are due by the 15th day of the 4th, 6th, 9th, and 12th months of the corporation's tax year. Did not file 2012 taxes Example 1. Did not file 2012 taxes Your corporation's tax year ends December 31. Did not file 2012 taxes Installment payments are due on April 15, June 15, September 15, and December 15. Did not file 2012 taxes Example 2. Did not file 2012 taxes Your corporation's tax year ends June 30. Did not file 2012 taxes Installment payments are due on October 15, December 15, March 15, and June 15. Did not file 2012 taxes   If any due date falls on a Saturday, Sunday, or legal holiday, the installment is due on the next business day. Did not file 2012 taxes How to figure each required installment. Did not file 2012 taxes   Use Form 1120-W, Estimated Tax for Corporations, as a worksheet to figure each required installment of estimated tax. Did not file 2012 taxes You will generally use one of the following two methods to figure each required installment. Did not file 2012 taxes You should use the method that yields the smallest installment payments. Did not file 2012 taxes Note. Did not file 2012 taxes In these discussions, “return” generally refers to the corporation's original return. Did not file 2012 taxes However, an amended return is considered the original return if it is filed by the due date (including extensions) of the original return. Did not file 2012 taxes Method 1. Did not file 2012 taxes   Each required installment is 25% of the income tax the corporation will show on its return for the current year. Did not file 2012 taxes Method 2. Did not file 2012 taxes   Each required installment is 25% of the income tax shown on the corporation's return for the previous year. Did not file 2012 taxes   To use Method 2: The corporation must have filed a return for the previous year, The return must have been for a full 12 months, and The return must have shown a positive tax liability (not zero). Did not file 2012 taxes Also, if the corporation is a large corporation, it can use Method 2 to figure the first installment only. Did not file 2012 taxes   See the Instructions for Form 1120-W, for the definition of a large corporation and other special rules for large corporations. Did not file 2012 taxes Other methods. Did not file 2012 taxes   If a corporation's income is expected to vary during the year because, for example, its business is seasonal, it may be able to lower the amount of one or more required installments by using one or both of the following methods. Did not file 2012 taxes The annualized income installment method. Did not file 2012 taxes The adjusted seasonal installment method. Did not file 2012 taxes Use Schedule A of Form 1120-W to determine if using one or both of these methods will lower the amount of any required installments. Did not file 2012 taxes Refiguring required installments. Did not file 2012 taxes   If after the corporation figures and deposits its estimated tax it finds that its tax liability for the year will be more or less than originally estimated, it may have to refigure its required installments to see if an underpayment penalty may apply. Did not file 2012 taxes An immediate catchup payment should be made to reduce any penalty resulting from the underpayment of any earlier installments. Did not file 2012 taxes Underpayment penalty. Did not file 2012 taxes   If the corporation does not pay a required installment of estimated tax by its due date, it may be subject to a penalty. Did not file 2012 taxes The penalty is figured separately for each installment due date. Did not file 2012 taxes The corporation may owe a penalty for an earlier due date, even if it paid enough tax later to make up the underpayment. Did not file 2012 taxes This is true even if the corporation is due a refund when its return is filed. Did not file 2012 taxes Form 2220. Did not file 2012 taxes   Use Form 2220, Underpayment of Estimated Tax by Corporations, to determine if a corporation is subject to the penalty for underpayment of estimated tax and to figure the amount of the penalty. Did not file 2012 taxes   If the corporation is charged a penalty, the amount of the penalty depends on the following three factors. Did not file 2012 taxes The amount of the underpayment. Did not file 2012 taxes The period during which the underpayment was due and unpaid. Did not file 2012 taxes The interest rate for underpayments published quarterly by the IRS in the Internal Revenue Bulletin. Did not file 2012 taxes   A corporation generally does not have to file Form 2220 with its income tax return because the IRS will figure any penalty and bill the corporation. Did not file 2012 taxes However, even if the corporation does not owe a penalty, complete and attach the form to the corporation's tax return if any of the following apply. Did not file 2012 taxes The annualized income installment method was used to figure any required installment. Did not file 2012 taxes The adjusted seasonal installment method was used to figure any required installment. Did not file 2012 taxes The corporation is a large corporation figuring its first required installment based on the prior year's tax. Did not file 2012 taxes How to pay estimated tax. Did not file 2012 taxes   A corporation is generally required to use EFTPS to pay its taxes. Did not file 2012 taxes See Electronic Federal Tax Payment System (EFTPS), earlier. Did not file 2012 taxes Also see the Instructions for Form 1120-W. Did not file 2012 taxes Quick refund of overpayments. Did not file 2012 taxes   A corporation that has overpaid its estimated tax for the tax year may be able to apply for a quick refund. Did not file 2012 taxes Use Form 4466, Corporation Application for Quick Refund of Overpayment of Estimated Tax, to apply for a quick refund of an overpayment of estimated tax. Did not file 2012 taxes A corporation can apply for a quick refund if the overpayment is: At least 10% of its expected tax liability, and At least $500. Did not file 2012 taxes Use Form 4466 to figure the corporation's expected tax liability and the overpayment of estimated tax. Did not file 2012 taxes File Form 4466 before the 16th day of the 3rd month after the end of the tax year, but before the corporation files its income tax return. Did not file 2012 taxes Do not file Form 4466 before the end of the corporation's tax year. Did not file 2012 taxes An extension of time to file the corporation's income tax return will not extend the time for filing Form 4466. Did not file 2012 taxes The IRS will act on the form within 45 days from the date you file it. Did not file 2012 taxes U. Did not file 2012 taxes S. Did not file 2012 taxes Real Property Interest If a domestic corporation acquires a U. Did not file 2012 taxes S. Did not file 2012 taxes real property interest from a foreign person or firm, the corporation may have to withhold tax on the amount it pays for the property. Did not file 2012 taxes The amount paid includes cash, the fair market value of other property, and any assumed liability. Did not file 2012 taxes If a domestic corporation distributes a U. Did not file 2012 taxes S. Did not file 2012 taxes real property interest to a foreign person or firm, it may have to withhold tax on the fair market value of the property. Did not file 2012 taxes A corporation that fails to withhold may be liable for the tax, and any penalties and interest that apply. Did not file 2012 taxes For more information, see section 1445 of the Internal Revenue Code; Publication 515, Withholding of Tax on Nonresident Aliens and Foreign Entities; Form 8288, U. Did not file 2012 taxes S. Did not file 2012 taxes Withholding Tax Return for Dispositions by Foreign Persons of U. Did not file 2012 taxes S. Did not file 2012 taxes Real Property Interests; and Form 8288-A, Statement of Withholding on Dispositions by Foreign Persons of U. Did not file 2012 taxes S. Did not file 2012 taxes Real Property Interests. Did not file 2012 taxes Accounting Methods An accounting method is a set of rules used to determine when and how income and expenses are reported. Did not file 2012 taxes Taxable income should be determined using the method of accounting regularly used in keeping the corporation's books and records. Did not file 2012 taxes In all cases, the method used must clearly show taxable income. Did not file 2012 taxes Generally, permissible methods include: Cash, Accrual, or Any other method authorized by the Internal Revenue Code. Did not file 2012 taxes Accrual method. Did not file 2012 taxes   Generally, a corporation (other than a qualified personal service corporation) must use the accrual method of accounting if its average annual gross receipts exceed $5 million. Did not file 2012 taxes A corporation engaged in farming operations also must use the accrual method. Did not file 2012 taxes   If inventories are required, the accrual method generally must be used for sales and purchases of merchandise. Did not file 2012 taxes However, qualifying taxpayers and eligible businesses of qualifying small business taxpayers are excepted from using the accrual method for eligible trades or businesses and may account for inventoriable items as materials and supplies that are not incidental. Did not file 2012 taxes   Under the accrual method, an amount is includable in income when: All the events have occurred that fix the right to receive the income, which is the earliest of the date: The required performance takes place, Payment is due, or Payment is received; and The amount can be determined with reasonable accuracy. Did not file 2012 taxes   Generally, an accrual basis taxpayer can deduct accrued expenses in the tax year when: All events that determine the liability have occurred, The amount of the liability can be figured with reasonable accuracy, and Economic performance takes place with respect to the expense. Did not file 2012 taxes   There are exceptions to the economic performance rule for certain items, including recurring expenses. Did not file 2012 taxes See section 461(h) of the Internal Revenue Code and the related regulations for the rules for determining when economic performance takes place. Did not file 2012 taxes Nonaccrual experience method. Did not file 2012 taxes   Accrual method corporations are not required to maintain accruals for certain amounts from the performance of services that, on the basis of their experience, will not be collected, if: The services are in the fields of health, law, engineering, architecture, accounting, actuarial science, performing arts, or consulting; or The corporation's average annual gross receipts for the 3 prior tax years does not exceed $5 million. Did not file 2012 taxes   This provision does not apply if interest is required to be paid on the amount or if there is any penalty for failure to pay the amount timely. Did not file 2012 taxes Percentage of completion method. Did not file 2012 taxes   Long-term contracts (except for certain real property construction contracts) must generally be accounted for using the percentage of completion method described in section 460 of the Internal Revenue Code. Did not file 2012 taxes Mark-to-market accounting method. Did not file 2012 taxes   Generally, dealers in securities must use the mark-to-market accounting method described in section 475 of the Internal Revenue Code. Did not file 2012 taxes Under this method any security held by a dealer as inventory must be included in inventory at its FMV. Did not file 2012 taxes Any security not held as inventory at the close of the tax year is treated as sold at its FMV on the last business day of the tax year. Did not file 2012 taxes Any gain or loss must be taken into account in determining gross income. Did not file 2012 taxes The gain or loss taken into account is treated as ordinary gain or loss. Did not file 2012 taxes   Dealers in commodities and traders in securities and commodities can elect to use the mark-to-market accounting method. Did not file 2012 taxes Change in accounting method. Did not file 2012 taxes   A corporation can change its method of accounting used to report taxable income (for income as a whole or for the treatment of any material item). Did not file 2012 taxes The corporation must file Form 3115, Application for Change in Accounting Method. Did not file 2012 taxes For more information, see Form 3115 and Publication 538. Did not file 2012 taxes Section 481(a) adjustment. Did not file 2012 taxes   The corporation may have to make an adjustment under section 481(a) of the Internal Revenue Code to prevent amounts of income or expense from being duplicated or omitted. Did not file 2012 taxes The section 481(a) adjustment period is generally 1 year for a net negative adjustment and 4 years for a net positive adjustment. Did not file 2012 taxes However, a corporation can elect to use a 1-year adjustment period if the net section 481(a) adjustment for the change is less than $25,000. Did not file 2012 taxes The corporation must complete the appropriate lines of Form 3115 to make the election. Did not file 2012 taxes See the Instructions for Form 3115. Did not file 2012 taxes Accounting Periods A corporation must figure its taxable income on the basis of a tax year. Did not file 2012 taxes A tax year is the annual accounting period a corporation uses to keep its records and report its income and expenses. Did not file 2012 taxes Generally, corporations can use either a calendar year or a fiscal year as its tax year. Did not file 2012 taxes Unless special rules apply, a corporation generally adopts a tax year by filing its first federal income tax return using that tax year. Did not file 2012 taxes For more information, see Publication 538. Did not file 2012 taxes Personal service corporation. Did not file 2012 taxes   A personal service corporation must use a calendar year as its tax year unless: It elects to use a 52–53 week tax year that ends with reference to the calendar year; It can establish a business purpose for a different tax year and obtains approval of the IRS. Did not file 2012 taxes See Form 1128, Application To Adopt, Change, or Retain a Tax Year, and Publication 538; or It elects under section 444 of the Internal Revenue Code to have a tax year other than a calendar year. Did not file 2012 taxes Use Form 8716, Election to Have a Tax Year Other Than a Required Tax Year, to make the election. Did not file 2012 taxes   If a personal service corporation makes a section 444 election, its deduction for certain amounts paid to employee-owners may be limited. Did not file 2012 taxes See Schedule H (Form 1120), Section 280H Limitations for a Personal Service Corporation (PSC), to figure the maximum deduction. Did not file 2012 taxes Change of tax year. Did not file 2012 taxes   Generally, a corporation must get the consent of the IRS before changing its tax year by filing Form 1128. Did not file 2012 taxes However, under certain conditions, a corporation can change its tax year without getting the consent. Did not file 2012 taxes For more information, see Form 1128 and Publication 538. Did not file 2012 taxes Recordkeeping A corporation should keep its records for as long as they may be needed for the administration of any provision of the Internal Revenue Code. Did not file 2012 taxes Usually records that support items of income, deductions, or credits on the return must be kept for 3 years from the date the return is due or filed, whichever is later. Did not file 2012 taxes Keep records that verify the corporation's basis in property for as long as they are needed to figure the basis of the original or replacement property. Did not file 2012 taxes The corporation should keep copies of all filed returns. Did not file 2012 taxes They help in preparing future and amended returns and in the calculation of earnings and profits. Did not file 2012 taxes Income, Deductions, and Special Provisions Rules on income and deductions that apply to individuals also apply, for the most part, to corporations. Did not file 2012 taxes However, the following special provisions apply only to corporations. Did not file 2012 taxes Costs of Going Into Business When you go into business, treat all costs you incur to get your business started as capital expenses. Did not file 2012 taxes However, a corporation can elect to deduct a limited amount of start-up or organizational costs. Did not file 2012 taxes Any costs not deducted can be amortized. Did not file 2012 taxes Start-up costs are costs for creating an active trade or business or investigating the creation or acquisition of an active trade or business. Did not file 2012 taxes Organizational costs are the direct costs of creating the corporation. Did not file 2012 taxes For more information on deducting or amortizing start-up and organizational costs, see the instructions for your income tax return. Did not file 2012 taxes Also see, Publication 535, chapter 7, Costs You Can Deduct or Capitalize, and chapter 8, Amortization. Did not file 2012 taxes Related Persons A corporation that uses an accrual method of accounting cannot deduct business expenses and interest owed to a related person who uses the cash method of accounting until the corporation makes the payment and the corresponding amount is includible in the related person's gross income. Did not file 2012 taxes Determine the relationship, for this rule, as of the end of the tax year for which the expense or interest would otherwise be deductible. Did not file 2012 taxes If a deduction is denied, the rule will continue to apply even if the corporation's relationship with the person ends before the expense or interest is includible in the gross income of that person. Did not file 2012 taxes These rules also deny the deduction of losses on the sale or exchange of property between related persons. Did not file 2012 taxes Related persons. Did not file 2012 taxes   For purposes of this rule, the following persons are related to a corporation. Did not file 2012 taxes Another corporation, that is a member of the same controlled group (as defined in section 267(f) of the Internal Revenue Code). Did not file 2012 taxes An individual who owns, directly or indirectly, more than 50% of the value of the outstanding stock of the corporation. Did not file 2012 taxes A trust fiduciary, when the trust or the grantor of the trust owns, directly or indirectly, more than 50% in value of the outstanding stock of the corporation. Did not file 2012 taxes An S corporation, if the same persons own more than 50% in value of the outstanding stock of each corporation. Did not file 2012 taxes A partnership, if the same persons own more than 50% in value of the outstanding stock of the corporation and more than 50% of the capital or profits interest in the partnership. Did not file 2012 taxes Any employee-owner, if the corporation is a personal service corporation (see Personal service corporation, earlier), regardless of the amount of stock owned by the employee-owner. Did not file 2012 taxes Ownership of stock. Did not file 2012 taxes   To determine whether an individual directly or indirectly owns any of the outstanding stock of a corporation, the following apply. Did not file 2012 taxes Stock owned, directly or indirectly, by or for a corporation, partnership, estate, or trust, is treated as being owned proportionately by or for its shareholders, partners, or beneficiaries. Did not file 2012 taxes An individual is treated as owning the stock owned, directly or indirectly, by or for the individual's family. Did not file 2012 taxes Family includes only brothers and sisters (including half brothers and half sisters), a spouse, ancestors, and lineal descendants. Did not file 2012 taxes Any individual owning (other than by applying (2), above) stock in a corporation, is treated as also owning the stock owned directly or indirectly by that individual's partner. Did not file 2012 taxes To apply (1), (2), or (3), above, stock constructively owned by a person under (1) is treated as actually owned by that person. Did not file 2012 taxes But stock constructively owned by an individual under (2) or (3) is not treated as actually owned by the individual for applying either (2) or (3) to make another person the constructive owner of that stock. Did not file 2012 taxes Reallocation of income and deductions. Did not file 2012 taxes   Where it is necessary to clearly show income or prevent tax evasion, the IRS can reallocate gross income, deductions, credits, or allowances between two or more organizations, trades, or businesses owned or controlled directly, or indirectly, by the same interests. Did not file 2012 taxes Complete liquidations. Did not file 2012 taxes   The disallowance of losses from the sale or exchange of property between related persons does not apply to liquidating distributions. Did not file 2012 taxes More information. Did not file 2012 taxes   For more information about the related person rules, see Publication 544. Did not file 2012 taxes Income From Qualifying Shipping Activities A corporation may make an election to be taxed on its notional shipping income at the highest corporate tax rate. Did not file 2012 taxes If a corporation makes this election it may exclude income from qualifying shipping activities from gross income. Did not file 2012 taxes Also if the election is made, the corporation generally may not claim any loss, deduction, or credit with respect to qualifying shipping activities. Did not file 2012 taxes A corporation making this election may also elect to defer gain on the disposition of a qualifying vessel. Did not file 2012 taxes A corporation uses Form 8902, Alternative Tax on Qualifying Shipping Activities, to make the election and figure the alternative tax. Did not file 2012 taxes For more information regarding the election, see Form 8902. Did not file 2012 taxes Election to Expense Qualified Refinery Property A corporation can make an irrevocable election on its tax return filed by the due date (including extensions) to deduct 50% of the cost of qualified refinery property (defined in section 179C(c) of the Internal Revenue Code), placed in service before January 1, 2014. Did not file 2012 taxes The deduction is allowed for the year in which the property is placed in service. Did not file 2012 taxes A subchapter T cooperative can make an irrevocable election on its return by the due date (including extensions) to allocate this deduction to its owners based on their ownership interest. Did not file 2012 taxes For more information, see section 179C of the Internal Revenue Code and the related Regulations. Did not file 2012 taxes Deduction to Comply With EPA Sulfur Regulations A small business refiner can make an irrevocable election on its tax return filed by the due date (including extensions) to deduct up to 75% of qualified costs paid or incurred to comply with the Highway Diesel Fuel Sulfur Control Requirements of the Environmental Protection Agency (EPA). Did not file 2012 taxes A subchapter T cooperative can make an irrevocable election on its return filed by the due date (including extensions) to allocate the deduction to its owners based on their ownership interest. Did not file 2012 taxes For more information, see sections 45H and 179B of the Internal Revenue Code and the related Regulations. Did not file 2012 taxes Energy-Efficient Commercial Building Property Deduction A corporation can claim a deduction for costs associated with energy-efficient commercial building property, placed in service before January 1, 2014. Did not file 2012 taxes In order to qualify for the deduction: The costs must be associated with depreciable or amortizable property in a Standard 90. Did not file 2012 taxes 1-2001 domestic building; The property must be either a part of the interior lighting system, the heating, cooling, ventilation and hot water system, or the building envelope (defined in section 179D(c)(1)(C) of the Internal Revenue Code); and The property must be installed as part of a plan to reduce the total annual energy and power costs of the building by 50% or more. Did not file 2012 taxes The deduction is limited to $1. Did not file 2012 taxes 80 per square foot of the building less the total amount of deductions taken for this property in prior tax years. Did not file 2012 taxes Other rules and limitations apply. Did not file 2012 taxes The corporation must reduce the basis of any property by any deduction taken. Did not file 2012 taxes The deduction is subject to recapture if the corporation fails to fully implement an energy savings plan. Did not file 2012 taxes For more information, see section 179D of the Internal Revenue Code. Did not file 2012 taxes Also see Notice 2006-52, 2006-26 I. Did not file 2012 taxes R. Did not file 2012 taxes B. Did not file 2012 taxes 1175, clarified and amplified by Notice 2008-40, 2008-14 I. Did not file 2012 taxes R. Did not file 2012 taxes B. Did not file 2012 taxes 725, and any successor. Did not file 2012 taxes Corporate Preference Items A corporation must make special adjustments to certain items before it takes them into account in determining its taxable income. Did not file 2012 taxes These items are known as corporate preference items and they include the following. Did not file 2012 taxes Gain on the disposition of section 1250 property. Did not file 2012 taxes For more information, see section 1250 Property under Depreciation Recapture in chapter 3 of Publication 544. Did not file 2012 taxes Percentage depletion for iron ore and coal (including lignite). Did not file 2012 taxes For more information, see Mines and Geothermal Deposits under Mineral Property in chapter 9 of Publication 535. Did not file 2012 taxes Amortization of pollution control facilities. Did not file 2012 taxes For more information, see Pollution Control Facilities in chapter 8 of Publication 535 and section 291(a)(5) of the Internal Revenue Code. Did not file 2012 taxes Mineral exploration and development costs. Did not file 2012 taxes For more information, see Exploration Costs and Development Costs in chapter 7 of Publication 535. Did not file 2012 taxes For more information on corporate preference items, see section 291 of the Internal Revenue Code. Did not file 2012 taxes Dividends-Received Deduction A corporation can deduct a percentage of certain dividends received during its tax year. Did not file 2012 taxes This section discusses the general rules that apply. Did not file 2012 taxes The deduction is figured on Form 1120, Schedule C, or the applicable schedule of your income tax return. Did not file 2012 taxes For more information, see the Instructions for Form 1120, or the instructions for your applicable income tax return. Did not file 2012 taxes Dividends from domestic corporations. Did not file 2012 taxes   A corporation can deduct, within certain limits, 70% of the dividends received if the corporation receiving the dividend owns less than 20% of the corporation distributing the dividend. Did not file 2012 taxes If the corporation owns 20% or more of the distributing corporation's stock, it can, subject to certain limits, deduct 80% of the dividends received. Did not file 2012 taxes Ownership. Did not file 2012 taxes   Determine ownership, for these rules, by the amount of voting power and value of the paying corporation's stock (other than certain preferred stock) the receiving corporation owns. Did not file 2012 taxes Small business investment companies. Did not file 2012 taxes   Small business investment companies can deduct 100% of the dividends received from taxable domestic corporations. Did not file 2012 taxes Dividends from regulated investment companies. Did not file 2012 taxes   Regulated investment company dividends received are subject to certain limits. Did not file 2012 taxes Capital gain dividends received from a regulated investment company do not qualify for the deduction. Did not file 2012 taxes For more information, see section 854 of the Internal Revenue Code. Did not file 2012 taxes No deduction allowed for certain dividends. Did not file 2012 taxes   Corporations cannot take a deduction for dividends received from the following entities. Did not file 2012 taxes A real estate investment trust (REIT). Did not file 2012 taxes A corporation exempt from tax under section 501 or 521 of the Internal Revenue Code either for the tax year of the distribution or the preceding tax year. Did not file 2012 taxes A corporation whose stock was held less than 46 days during the 91-day period beginning 45 days before the stock became ex-dividend with respect to the dividend. Did not file 2012 taxes Ex-dividend means the holder has no rights to the dividend. Did not file 2012 taxes A corporation whose preferred stock was held less than 91 days during the 181-day period beginning 90 days before the stock became ex-dividend with respect to the dividend if the dividends received are for a period or periods totaling more than 366 days. Did not file 2012 taxes Any corporation, if your corporation is under an obligation (pursuant to a short sale or otherwise) to make related payments with respect to positions in substantially similar or related property. Did not file 2012 taxes Dividends on deposits. Did not file 2012 taxes   Dividends on deposits or withdrawable accounts in domestic building and loan associations, mutual savings banks, cooperative banks, and similar organizations are interest, not dividends. Did not file 2012 taxes They do not qualify for this deduction. Did not file 2012 taxes Limit on deduction for dividends. Did not file 2012 taxes   The total deduction for dividends received or accrued is generally limited (in the following order) to: 80% of the difference between taxable income and the 100% deduction allowed for dividends received from affiliated corporations, or by a small business investment company, for dividends received or accrued from 20%-owned corporations, then 70% of the difference between taxable income and the 100% deduction allowed for dividends received from affiliated corporations, or by a small business investment company, for dividends received or accrued from less-than-20%-owned corporations (reducing taxable income by the total dividends received from 20%-owned corporations). Did not file 2012 taxes Figuring the limit. Did not file 2012 taxes   In figuring the limit, determine taxable income without the following items. Did not file 2012 taxes The net operating loss deduction. Did not file 2012 taxes The domestic production activities deduction. Did not file 2012 taxes The deduction for dividends received. Did not file 2012 taxes Any adjustment due to the nontaxable part of an extraordinary dividend (see Extraordinary Dividends, below). Did not file 2012 taxes Any capital loss carryback to the tax year. Did not file 2012 taxes Effect of net operating loss. Did not file 2012 taxes   If a corporation has a net operating loss (NOL) for a tax year, the limit of 80% (or 70%) of taxable income does not apply. Did not file 2012 taxes To determine whether a corporation has an NOL, figure the dividends-received deduction without the 80% (or 70%) of taxable income limit. Did not file 2012 taxes Example 1. Did not file 2012 taxes A corporation loses $25,000 from operations. Did not file 2012 taxes It receives $100,000 in dividends from a 20%-owned corporation. Did not file 2012 taxes Its taxable income is $75,000 ($100,000 – $25,000) before the deduction for dividends received. Did not file 2012 taxes If it claims the full dividends-received deduction of $80,000 ($100,000 × 80%) and combines it with an operations loss of $25,000, it will have an NOL of ($5,000). Did not file 2012 taxes Therefore, the 80% of taxable income limit does not apply. Did not file 2012 taxes The corporation can deduct the full $80,000. Did not file 2012 taxes Example 2. Did not file 2012 taxes Assume the same facts as in Example 1, except that the corporation only loses $15,000 from operations. Did not file 2012 taxes Its taxable income is $85,000 before the deduction for dividends received. Did not file 2012 taxes After claiming the dividends-received deduction of $80,000 ($100,000 × 80%), its taxable income is $5,000. Did not file 2012 taxes Because the corporation will not have an NOL after applying a full dividends-received deduction, its allowable dividends-received deduction is limited to 80% of its taxable income, or $68,000 ($85,000 × 80%). Did not file 2012 taxes Extraordinary Dividends If a corporation receives an extraordinary dividend on stock held 2 years or less before the dividend announcement date, it generally must reduce its basis in the stock by the nontaxed part of the dividend. Did not file 2012 taxes The nontaxed part is any dividends-received deduction allowable for the dividends. Did not file 2012 taxes Extraordinary dividend. Did not file 2012 taxes   An extraordinary dividend is any dividend on stock that equals or exceeds a certain percentage of the corporation's adjusted basis in the stock. Did not file 2012 taxes The percentages are: 5% for stock preferred as to dividends, or 10% for other stock. Did not file 2012 taxes Treat all dividends received that have ex-dividend dates within an 85-consecutive-day period as one dividend. Did not file 2012 taxes Treat all dividends received that have ex-dividend dates within a 365-consecutive-day period as extraordinary dividends if the total of the dividends exceeds 20% of the corporation's adjusted basis in the stock. Did not file 2012 taxes Disqualified preferred stock. Did not file 2012 taxes   Any dividend on disqualified preferred stock is treated as an extraordinary dividend regardless of the period of time the corporation held the stock. Did not file 2012 taxes   Disqualified preferred stock is any stock preferred as to dividends if any of the following apply. Did not file 2012 taxes The stock when issued has a dividend rate that declines (or can reasonably be expected to decline) in the future. Did not file 2012 taxes The issue price of the stock exceeds its liquidation rights or stated redemption price. Did not file 2012 taxes The stock is otherwise structured to avoid the rules for extraordinary dividends and to enable corporate shareholders to reduce tax through a combination of dividends-received deductions and loss on the disposition of the stock. Did not file 2012 taxes   These rules apply to stock issued after July 10, 1989, unless it was issued under a written binding contract in effect on that date, and thereafter, before the issuance of the stock. Did not file 2012 taxes More information. Did not file 2012 taxes   For more information on extraordinary dividends, see section 1059 of the Internal Revenue Code. Did not file 2012 taxes Below-Market Loans If a corporation receives a below-market loan and uses the proceeds for its trade or business, it may be able to deduct the forgone interest. Did not file 2012 taxes A below-market loan is a loan on which no interest is charged or on which interest is charged at a rate below the applicable federal rate. Did not file 2012 taxes A below-market loan generally is treated as an arm's-length transaction in which the borrower is considered as having received both the following: A loan in exchange for a note that requires payment of interest at the applicable federal rate, and An additional payment in an amount equal to the forgone interest. Did not file 2012 taxes Treat the additional payment as a gift, dividend, contribution to capital, payment of compensation, or other payment, depending on the substance of the transaction. Did not file 2012 taxes Foregone interest. Did not file 2012 taxes   For any period, forgone interest is equal to: The interest that would be payable for that period if interest accrued on the loan at the applicable federal rate and was payable annually on December 31, minus Any interest actually payable on the loan for the period. Did not file 2012 taxes See Below-market loans, in chapter 4 of Publication 535 for more information. Did not file 2012 taxes Charitable Contributions A corporation can claim a limited deduction for charitable contributions made in cash or other property. Did not file 2012 taxes The contribution is deductible if made to, or for the use of, a qualified organization. Did not file 2012 taxes For more information on qualified organizations, see Publication 526, Charitable Contributions. Did not file 2012 taxes Also see, Exempt Organizations Select Check (EO Select Check) at www. Did not file 2012 taxes irs. Did not file 2012 taxes gov/charities, the on-line search tool for finding information on organizations eligible to receive tax-deductible contributions. Did not file 2012 taxes Note. Did not file 2012 taxes You cannot take a deduction if any of the net earnings of an organization receiving contributions benefit any private shareholder or individual. Did not file 2012 taxes Cash method corporation. Did not file 2012 taxes   A corporation using the cash method of accounting deducts contributions in the tax year paid. Did not file 2012 taxes Accrual method corporation. Did not file 2012 taxes   A corporation using an accrual method of accounting can choose to deduct unpaid contributions for the tax year the board of directors authorizes them if it pays them by the 15th day of the 3rd month after the close of that tax year. Did not file 2012 taxes Make the choice by reporting the contribution on the corporation's return for the tax year. Did not file 2012 taxes A declaration stating that the board of directors adopted the resolution during the tax year must accompany the return. Did not file 2012 taxes The declaration must include the date the resolution was adopted. Did not file 2012 taxes Limitations on deduction. Did not file 2012 taxes   A corporation cannot deduct charitable contributions that exceed 10% of its taxable income for the tax year. Did not file 2012 taxes Figure taxable income for this purpose without the following. Did not file 2012 taxes The deduction for charitable contributions. Did not file 2012 taxes The dividends-received deduction. Did not file 2012 taxes The deduction allowed under section 249 of the Internal Revenue Code. Did not file 2012 taxes The domestic production activities deduction. Did not file 2012 taxes Any net operating loss carryback to the tax year. Did not file 2012 taxes Any capital loss carryback to the tax year. Did not file 2012 taxes Farmers and ranchers. Did not file 2012 taxes    Corporations that are farmers and ranchers should see section 170(b)(2) of the Internal Revenue Code for special rules that may affect the deduction limit. Did not file 2012 taxes Carryover of excess contributions. Did not file 2012 taxes   You can carry over, within certain limits, to each of the subsequent 5 years any charitable contributions made during the current year that exceed the 10% limit. Did not file 2012 taxes You lose any excess not used within that period. Did not file 2012 taxes For example, if a corporation has a carryover of excess contributions paid in 2010 and it does not use all the excess on its return for 2011, it can carry any excess over to 2012, 2013, 2014, and 2015, if applicable. Did not file 2012 taxes Any excess not used in 2015 is lost. Did not file 2012 taxes Do not deduct a carryover of excess contributions in the carryover year until after you deduct contributions made in that year (subject to the 10% limit). Did not file 2012 taxes You cannot deduct a carryover of excess contributions to the extent it increases a net operating loss carryover. Did not file 2012 taxes Cash contributions. Did not file 2012 taxes   A corporation must maintain a record of any contribution of cash, check, or other monetary contribution, regardless of the amount. Did not file 2012 taxes The record can be a bank record, receipt, letter, or other written communication from the donee indicating the name of the organization, the date of the contribution, and the amount of the contribution. Did not file 2012 taxes Keep the record of the contribution with the other corporate records. Did not file 2012 taxes Do not attach the records to the corporation's return. Did not file 2012 taxes For more information on cash contributions, see Publication 526. Did not file 2012 taxes Gifts of $250 or more. Did not file 2012 taxes   Generally, no deduction is allowed for any contribution of $250 or more unless the corporation gets a written acknowledgement from the donee organization. Did not file 2012 taxes The acknowledgement should show the amount of cash contributed, a description of the property contributed, and either gives a description and a good faith estimate of the value of any goods or services provided in return for the contribution or states that no goods or services were provided in return for the contribution. Did not file 2012 taxes The acknowledgement should be received by the due date (including extensions) of the return, or, if earlier, the date the return was filed. Did not file 2012 taxes Keep the acknowledgement with other corporate records. Did not file 2012 taxes Do not attach the acknowledgement to the return. Did not file 2012 taxes Contributions of property other than cash. Did not file 2012 taxes   If a corporation (other than a closely-held or a personal service corporation) claims a deduction of more than $500 for contributions of property other than cash, a schedule describing the property and the method used to determine its fair market value must be attached to the corporation's return. Did not file 2012 taxes In addition the corporation should keep a record of: The approximate date and manner of acquisition of the donated property and The cost or other basis of the donated property held by the donor for less than 12 months prior to contribution. Did not file 2012 taxes   Closely held and personal service corporations must complete and attach Form 8283, Noncash Charitable Contributions, to their returns if they claim a deduction of more than $500 for non-cash contributions. Did not file 2012 taxes For all other corporations, if the deduction claimed for donated property exceeds $5,000, complete Form 8283 and attach it to the corporation's return. Did not file 2012 taxes   A corporation must obtain a qualified appraisal for all deductions of property claimed in excess of $5,000. Did not file 2012 taxes A qualified appraisal is not required for the donation of cash, publicly traded securities, inventory, and any qualified vehicles sold by a donee organization without any significant intervening use or material improvement. Did not file 2012 taxes The appraisal should be maintained with other corporate records and only attached to the corporation's return when the deduction claimed exceeds $500,000; $20,000 for donated art work. Did not file 2012 taxes   See Form 8283 for more information. Did not file 2012 taxes Qualified conservation contributions. Did not file 2012 taxes   If a corporation makes a qualified conservation contribution, the corporation must provide information regarding the legal interest being donated, the fair market value of the underlying property before and after the donation, and a description of the conservation purpose for which the property will be used. Did not file 2012 taxes For more information, see section 170(h) of the Internal Revenue Code. Did not file 2012 taxes Contributions of used vehicles. Did not file 2012 taxes   A corporation is allowed a deduction for the contribution of used motor vehicles, boats, and airplanes. Did not file 2012 taxes The deduction is limited, and other special rules apply. Did not file 2012 taxes For more information, see Publication 526. Did not file 2012 taxes Reduction for contributions of certain property. Did not file 2012 taxes   For a charitable contribution of property, the corporation must reduce the contribution by the sum of: The ordinary income and short-term capital gain that would have resulted if the property were sold at its FMV and For certain contributions, the long-term capital gain that would have resulted if the property were sold at its FMV. Did not file 2012 taxes   The reduction for the long-term capital gain applies to: Contributions of tangible personal property for use by an exempt organization for a purpose or function unrelated to the basis for its exemption; Contributions of any property to or for the use of certain private foundations except for stock for which market quotations are readily available; and Contributions of any patent, certain copyrights, trademark, trade name, trade secret, know-how, software (that is a section 197 intangible), or similar property, or applications or registrations of such property. Did not file 2012 taxes Larger deduction. Did not file 2012 taxes   A corporation (other than an S corporation) may be able to claim a deduction equal to the lesser of (a) the basis of the donated inventory or property plus one-half of the inventory or property's appreciation (gain if the donated inventory or property was sold at fair market value on the date of the donation), or (b) two times basis of the donated inventory or property. Did not file 2012 taxes This deduction may be allowed for certain contributions of: Certain inventory and other property made to a donee organization and used solely for the care of the ill, the needy, and infants. Did not file 2012 taxes Scientific property constructed by the corporation (other than an S corporation, personal holding company, or personal service corporation) and donated no later than 2 years after substantial completion of the construction. Did not file 2012 taxes The property must be donated to a qualified organization and its original use must be by the donee for research, experimentation, or research training within the United States in the area of physical or biological science. Did not file 2012 taxes Computer technology and equipment acquired or constructed and donated no later than 3 years after either acquisition or substantial completion of construction to an educational organization for educational purposes within the United States. Did not file 2012 taxes Contributions to organizations conducting lobbying activities. Did not file 2012 taxes   Contributions made to an organization that conducts lobbying activities are not deductible if: The lobbying activities relate to matters of direct financial interest to the donor's trade or business and The principal purpose of the contribution was to avoid federal income tax by obtaining a deduction for activities that would have been nondeductible under the lobbying expense rules if conducted directly by the donor. Did not file 2012 taxes More information. Did not file 2012 taxes   For more information on charitable contributions, including substantiation and recordkeeping requirements, see section 170 of the Internal Revenue Code, the related regulations, and Publication 526. Did not file 2012 taxes Capital Losses A corporation can deduct capital losses only up to the amount of its capital gains. Did not file 2012 taxes In other words, if a corporation has an excess capital loss, it cannot deduct the loss in the current tax year. Did not file 2012 taxes Instead, it carries the loss to other tax years and deducts it from any net capital gains that occur in those years. Did not file 2012 taxes A capital loss is carried to other years in the following order. Did not file 2012 taxes 3 years prior to the loss year. Did not file 2012 taxes 2 years prior to the loss year. Did not file 2012 taxes 1 year prior to the loss year. Did not file 2012 taxes Any loss remaining is carried forward for 5 years. Did not file 2012 taxes When you carry a net capital loss to another tax year, treat it as a short-term loss. Did not file 2012 taxes It does not retain its original identity as long term or short term. Did not file 2012 taxes Example. Did not file 2012 taxes A calendar year corporation has a net short-term capital gain of $3,000 and a net long-term capital loss of $9,000. Did not file 2012 taxes The short-term gain offsets some of the long-term loss, leaving a net capital loss of $6,000. Did not file 2012 taxes The corporation treats this $6,000 as a short-term loss when carried back or forward. Did not file 2012 taxes The corporation carries the $6,000 short-term loss back 3 years. Did not file 2012 taxes In year 1, the corporation had a net short-term capital gain of $8,000 and a net long-term capital gain of $5,000. Did not file 2012 taxes It subtracts the $6,000 short-term loss first from the net short-term gain. Did not file 2012 taxes This results in a net capital gain for year 1 of $7,000. Did not file 2012 taxes This consists of a net short-term capital gain of $2,000 ($8,000 − $6,000) and a net long-term capital gain of $5,000. Did not file 2012 taxes S corporation status. Did not file 2012 taxes   A corporation may not carry a capital loss from, or to, a year for which it is an S corporation. Did not file 2012 taxes Rules for carryover and carryback. Did not file 2012 taxes   When carrying a capital loss from one year to another, the following rules apply. Did not file 2012 taxes When figuring the current year's net capital loss, you cannot combine it with a capital loss carried from another year. Did not file 2012 taxes In other words, you can carry capital losses only to years that would otherwise have a total net capital gain. Did not file 2012 taxes If you carry capital losses from 2 or more years to the same year, deduct the loss from the earliest year first. Did not file 2012 taxes You cannot use a capital loss carried from another year to produce or increase a net operating loss in the year to which you carry it back. Did not file 2012 taxes Refunds. Did not file 2012 taxes   When you carry back a capital loss to an earlier tax year, refigure your tax for that year. Did not file 2012 taxes If your corrected tax is less than the tax you originally owed, use either Form 1139, Corporate Application for Tentative Refund, or Form 1120X, Amended U. Did not file 2012 taxes S. Did not file 2012 taxes Corporation Income Tax Return, to apply for a refund. Did not file 2012 taxes Form 1139. Did not file 2012 taxes    A corporation can get a refund faster by using Form 1139. Did not file 2012 taxes It cannot file Form 1139 before filing the return for the corporation's capital loss year, but it must file Form 1139 no later than 1 year after the year it sustains the capital loss. Did not file 2012 taxes Form 1120X. Did not file 2012 taxes   If the corporation does not file Form 1139, it must file Form 1120X to apply for a refund. Did not file 2012 taxes The corporation must file the Form 1120X within 3 years of the due date, includin