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Download state tax forms free 4. Download state tax forms free   Qualified Plans Table of Contents Topics - This chapter discusses: Useful Items - You may want to see: Kinds of PlansDefined Contribution Plan Defined Benefit Plan Qualification RulesEarly retirement. Download state tax forms free Loan secured by benefits. Download state tax forms free Waiver of survivor benefits. Download state tax forms free Waiver of 30-day waiting period before annuity starting date. Download state tax forms free Involuntary cash-out of benefits not more than dollar limit. Download state tax forms free Exception for certain loans. Download state tax forms free Exception for QDRO. Download state tax forms free SIMPLE and safe harbor 401(k) plan exception. Download state tax forms free Setting Up a Qualified PlanAdopting a Written Plan Investing Plan Assets Minimum Funding RequirementDue dates. Download state tax forms free Installment percentage. Download state tax forms free Extended period for making contributions. Download state tax forms free ContributionsEmployer Contributions Employee Contributions When Contributions Are Considered Made Employer DeductionDeduction Limits Deduction Limit for Self-Employed Individuals Where To Deduct Contributions Carryover of Excess Contributions Excise Tax for Nondeductible (Excess) Contributions Elective Deferrals (401(k) Plans)Limit on Elective Deferrals Automatic Enrollment Treatment of Excess Deferrals Qualified Roth Contribution ProgramElective Deferrals Qualified Distributions Reporting Requirements DistributionsRequired Distributions Distributions From 401(k) Plans Tax Treatment of Distributions Tax on Early Distributions Tax on Excess Benefits Excise Tax on Reversion of Plan Assets Notification of Significant Benefit Accrual Reduction Prohibited TransactionsTax on Prohibited Transactions Reporting RequirementsOne-participant plan. Download state tax forms free Caution: Form 5500-EZ not required. Download state tax forms free Form 5500. Download state tax forms free Electronic filing of Forms 5500 and 5500-SF. Download state tax forms free Topics - This chapter discusses: Kinds of plans Qualification rules Setting up a qualified plan Minimum funding requirement Contributions Employer deduction Elective deferrals (401(k) plans) Qualified Roth contribution program Distributions Prohibited transactions Reporting requirements Useful Items - You may want to see: Publications 575 Pension and Annuity Income 590 Individual Retirement Arrangements (IRAs) 3066 Have you had your Check-up this year? for Retirement Plans 3998 Choosing A Retirement Solution for Your Small Business 4222 401(k) Plans for Small Businesses 4530 Designated Roth Accounts under a 401(k), 403(b), or governmental 457(b) plans 4531 401(k) Plan Checklist 4674 Automatic Enrollment 401(k) Plans for Small Businesses 4806 Profit Sharing Plans for Small Businesses Forms (and Instructions) www. Download state tax forms free dol. Download state tax forms free gov/ebsa/pdf/2013-5500. Download state tax forms free pdf www. Download state tax forms free dol. Download state tax forms free gov/ebsa/pdf/2013-5500-SF. Download state tax forms free pdf W-2 Wage and Tax Statement Schedule K-1 (Form 1065) Partner's Share of Income, Deductions, Credits, etc. Download state tax forms free 1099-R Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc. Download state tax forms free 1040 U. Download state tax forms free S. Download state tax forms free Individual Income Tax Return Schedule C (Form 1040) Profit or Loss From Business Schedule F (Form 1040) Profit or Loss From Farming 5300 Application for Determination for Employee Benefit Plan 5310 Application for Determination for Terminating Plan 5329 Additional Taxes on Qualified Plans (Including IRAs) and Other Tax-Favored Accounts 5330 Return of Excise Taxes Related to Employee Benefit Plans 5500 Annual Return/Report of Employee Benefit Plan. Download state tax forms free For copies of this form, go to: 5500-EZ Annual Return of One-Participant (Owners and Their Spouses) Retirement Plan 5500-SF Short Form Annual Return/Report of Small Employee Benefit Plan. Download state tax forms free For copies of this form, go to: 8717 User Fee for Employee Plan Determination Letter Request 8880 Credit for Qualified Retirement Savings Contributions 8881 Credit for Small Employer Pension Plan Startup Costs 8955-SSA Annual Registration Statement Identifying Separated Participants With Deferred Vested Benefits These qualified retirement plans set up by self-employed individuals are sometimes called Keogh or H. Download state tax forms free R. Download state tax forms free 10 plans. Download state tax forms free A sole proprietor or a partnership can set up one of these plans. Download state tax forms free A common-law employee or a partner cannot set up one of these plans. Download state tax forms free The plans described here can also be set up and maintained by employers that are corporations. Download state tax forms free All the rules discussed here apply to corporations except where specifically limited to the self-employed. Download state tax forms free The plan must be for the exclusive benefit of employees or their beneficiaries. Download state tax forms free These qualified plans can include coverage for a self-employed individual. Download state tax forms free As an employer, you can usually deduct, subject to limits, contributions you make to a qualified plan, including those made for your own retirement. Download state tax forms free The contributions (and earnings and gains on them) are generally tax free until distributed by the plan. Download state tax forms free Kinds of Plans There are two basic kinds of qualified plans—defined contribution plans and defined benefit plans—and different rules apply to each. Download state tax forms free You can have more than one qualified plan, but your contributions to all the plans must not total more than the overall limits discussed under Contributions and Employer Deduction, later. Download state tax forms free Defined Contribution Plan A defined contribution plan provides an individual account for each participant in the plan. Download state tax forms free It provides benefits to a participant largely based on the amount contributed to that participant's account. Download state tax forms free Benefits are also affected by any income, expenses, gains, losses, and forfeitures of other accounts that may be allocated to an account. Download state tax forms free A defined contribution plan can be either a profit-sharing plan or a money purchase pension plan. Download state tax forms free Profit-sharing plan. Download state tax forms free   Although it is called a “profit-sharing plan,” you do not actually have to make a business profit for the year in order to make a contribution (except for yourself if you are self-employed as discussed under Self-employed Individual, later). Download state tax forms free A profit-sharing plan can be set up to allow for discretionary employer contributions, meaning the amount contributed each year to the plan is not fixed. Download state tax forms free An employer may even make no contribution to the plan for a given year. Download state tax forms free   The plan must provide a definite formula for allocating the contribution among the participants and for distributing the accumulated funds to the employees after they reach a certain age, after a fixed number of years, or upon certain other occurrences. Download state tax forms free   In general, you can be more flexible in making contributions to a profit-sharing plan than to a money purchase pension plan (discussed next) or a defined benefit plan (discussed later). Download state tax forms free Money purchase pension plan. Download state tax forms free   Contributions to a money purchase pension plan are fixed and are not based on your business profits. Download state tax forms free For example, if the plan requires that contributions be 10% of the participants' compensation without regard to whether you have profits (or the self-employed person has earned income), the plan is a money purchase pension plan. Download state tax forms free This applies even though the compensation of a self-employed individual as a participant is based on earned income derived from business profits. Download state tax forms free Defined Benefit Plan A defined benefit plan is any plan that is not a defined contribution plan. Download state tax forms free Contributions to a defined benefit plan are based on what is needed to provide definitely determinable benefits to plan participants. Download state tax forms free Actuarial assumptions and computations are required to figure these contributions. Download state tax forms free Generally, you will need continuing professional help to have a defined benefit plan. Download state tax forms free Qualification Rules To qualify for the tax benefits available to qualified plans, a plan must meet certain requirements (qualification rules) of the tax law. Download state tax forms free Generally, unless you write your own plan, the financial institution that provided your plan will take the continuing responsibility for meeting qualification rules that are later changed. Download state tax forms free The following is a brief overview of important qualification rules that generally have not yet been discussed. Download state tax forms free It is not intended to be all-inclusive. Download state tax forms free See Setting Up a Qualified Plan , later. Download state tax forms free Generally, the following qualification rules also apply to a SIMPLE 401(k) retirement plan. Download state tax forms free A SIMPLE 401(k) plan is, however, not subject to the top-heavy plan rules and nondiscrimination rules if the plan satisfies the provisions discussed in chapter 3 under SIMPLE 401(k) Plan. Download state tax forms free Plan assets must not be diverted. Download state tax forms free   Your plan must make it impossible for its assets to be used for, or diverted to, purposes other than the benefit of employees and their beneficiaries. Download state tax forms free As a general rule, the assets cannot be diverted to the employer. Download state tax forms free Minimum coverage requirement must be met. Download state tax forms free   To be a qualified plan, a defined benefit plan must benefit at least the lesser of the following. Download state tax forms free 50 employees, or The greater of: 40% of all employees, or Two employees. Download state tax forms free If there is only one employee, the plan must benefit that employee. Download state tax forms free Contributions or benefits must not discriminate. Download state tax forms free   Under the plan, contributions or benefits to be provided must not discriminate in favor of highly compensated employees. Download state tax forms free Contributions and benefits must not be more than certain limits. Download state tax forms free   Your plan must not provide for contributions or benefits that are more than certain limits. Download state tax forms free The limits apply to the annual contributions and other additions to the account of a participant in a defined contribution plan and to the annual benefit payable to a participant in a defined benefit plan. Download state tax forms free These limits are discussed later in this chapter under Contributions. Download state tax forms free Minimum vesting standard must be met. Download state tax forms free   Your plan must satisfy certain requirements regarding when benefits vest. Download state tax forms free A benefit is vested (you have a fixed right to it) when it becomes nonforfeitable. Download state tax forms free A benefit is nonforfeitable if it cannot be lost upon the happening, or failure to happen, of any event. Download state tax forms free Special rules apply to forfeited benefit amounts. Download state tax forms free In defined contribution plans, forfeitures can be allocated to the accounts of remaining participants in a nondiscriminatory way, or they can be used to reduce your contributions. Download state tax forms free   Forfeitures under a defined benefit plan cannot be used to increase the benefits any employee would otherwise receive under the plan. Download state tax forms free Forfeitures must be used instead to reduce employer contributions. Download state tax forms free Participation. Download state tax forms free   In general, an employee must be allowed to participate in your plan if he or she meets both the following requirements. Download state tax forms free Has reached age 21. Download state tax forms free Has at least 1 year of service (2 years if the plan is not a 401(k) plan and provides that after not more than 2 years of service the employee has a nonforfeitable right to all his or her accrued benefit). Download state tax forms free A plan cannot exclude an employee because he or she has reached a specified age. Download state tax forms free Leased employee. Download state tax forms free   A leased employee, defined in chapter 1, who performs services for you (recipient of the services) is treated as your employee for certain plan qualification rules. Download state tax forms free These rules include those in all the following areas. Download state tax forms free Nondiscrimination in coverage, contributions, and benefits. Download state tax forms free Minimum age and service requirements. Download state tax forms free Vesting. Download state tax forms free Limits on contributions and benefits. Download state tax forms free Top-heavy plan requirements. Download state tax forms free Contributions or benefits provided by the leasing organization for services performed for you are treated as provided by you. Download state tax forms free Benefit payment must begin when required. Download state tax forms free   Your plan must provide that, unless the participant chooses otherwise, the payment of benefits to the participant must begin within 60 days after the close of the latest of the following periods. Download state tax forms free The plan year in which the participant reaches the earlier of age 65 or the normal retirement age specified in the plan. Download state tax forms free The plan year in which the 10th anniversary of the year in which the participant began participating in the plan occurs. Download state tax forms free The plan year in which the participant separates from service. Download state tax forms free Early retirement. Download state tax forms free   Your plan can provide for payment of retirement benefits before the normal retirement age. Download state tax forms free If your plan offers an early retirement benefit, a participant who separates from service before satisfying the early retirement age requirement is entitled to that benefit if he or she meets both the following requirements. Download state tax forms free Satisfies the service requirement for the early retirement benefit. Download state tax forms free Separates from service with a nonforfeitable right to an accrued benefit. Download state tax forms free The benefit, which may be actuarially reduced, is payable when the early retirement age requirement is met. Download state tax forms free Required minimum distributions. Download state tax forms free   Special rules require minimum annual distributions from qualified plans, generally beginning after age  70½. Download state tax forms free See Required Distributions , under Distributions, later. Download state tax forms free Survivor benefits. Download state tax forms free   Defined benefit and money purchase pension plans must provide automatic survivor benefits in both the following forms. Download state tax forms free A qualified joint and survivor annuity for a vested participant who does not die before the annuity starting date. Download state tax forms free A qualified pre-retirement survivor annuity for a vested participant who dies before the annuity starting date and who has a surviving spouse. Download state tax forms free   The automatic survivor benefit also applies to any participant under a profit-sharing plan unless all the following conditions are met. Download state tax forms free The participant does not choose benefits in the form of a life annuity. Download state tax forms free The plan pays the full vested account balance to the participant's surviving spouse (or other beneficiary if the surviving spouse consents or if there is no surviving spouse) if the participant dies. Download state tax forms free The plan is not a direct or indirect transferee of a plan that must provide automatic survivor benefits. Download state tax forms free Loan secured by benefits. Download state tax forms free   If automatic survivor benefits are required for a spouse under a plan, he or she must consent to a loan that uses as security the accrued benefits in the plan. Download state tax forms free Waiver of survivor benefits. Download state tax forms free   Each plan participant may be permitted to waive the joint and survivor annuity or the pre-retirement survivor annuity (or both), but only if the participant has the written consent of the spouse. Download state tax forms free The plan also must allow the participant to withdraw the waiver. Download state tax forms free The spouse's consent must be witnessed by a plan representative or notary public. Download state tax forms free Waiver of 30-day waiting period before annuity starting date. Download state tax forms free    A plan may permit a participant to waive (with spousal consent) the 30-day minimum waiting period after a written explanation of the terms and conditions of a joint and survivor annuity is provided to each participant. Download state tax forms free   The waiver is allowed only if the distribution begins more than 7 days after the written explanation is provided. Download state tax forms free Involuntary cash-out of benefits not more than dollar limit. Download state tax forms free   A plan may provide for the immediate distribution of the participant's benefit under the plan if the present value of the benefit is not greater than $5,000. Download state tax forms free   However, the distribution cannot be made after the annuity starting date unless the participant and the spouse or surviving spouse of a participant who died (if automatic survivor benefits are required for a spouse under the plan) consents in writing to the distribution. Download state tax forms free If the present value is greater than $5,000, the plan must have the written consent of the participant and the spouse or surviving spouse (if automatic survivor benefits are required for a spouse under the plan) for any immediate distribution of the benefit. Download state tax forms free   Benefits attributable to rollover contributions and earnings on them can be ignored in determining the present value of these benefits. Download state tax forms free   A plan must provide for the automatic rollover of any cash-out distribution of more than $1,000 to an individual retirement account or annuity, unless the participant chooses otherwise. Download state tax forms free A section 402(f) notice must be sent prior to an involuntary cash-out of an eligible rollover distribution. Download state tax forms free See Section 402(f) Notice under Distributions, later, for more details. Download state tax forms free Consolidation, merger, or transfer of assets or liabilities. Download state tax forms free   Your plan must provide that, in the case of any merger or consolidation with, or transfer of assets or liabilities to, any other plan, each participant would (if the plan then terminated) receive a benefit equal to or more than the benefit he or she would have been entitled to just before the merger, etc. Download state tax forms free (if the plan had then terminated). Download state tax forms free Benefits must not be assigned or alienated. Download state tax forms free   Your plan must provide that a participant's or beneficiary's benefits under the plan cannot be taken away by any legal or equitable proceeding except as provided below or pursuant to certain judgements or settlements against the participant for violations of plan rules. Download state tax forms free Exception for certain loans. Download state tax forms free   A loan from the plan (not from a third party) to a participant or beneficiary is not treated as an assignment or alienation if the loan is secured by the participant's accrued nonforfeitable benefit and is exempt from the tax on prohibited transactions under section 4975(d)(1) or would be exempt if the participant were a disqualified person. Download state tax forms free A disqualified person is defined later in this chapter under Prohibited Transactions. Download state tax forms free Exception for QDRO. Download state tax forms free   Compliance with a QDRO (qualified domestic relations order) does not result in a prohibited assignment or alienation of benefits. Download state tax forms free   Payments to an alternate payee under a QDRO before the participant attains age 59½ are not subject to the 10% additional tax that would otherwise apply under certain circumstances. Download state tax forms free Benefits distributed to an alternate payee under a QDRO can be rolled over tax free to an individual retirement account or to an individual retirement annuity. Download state tax forms free No benefit reduction for social security increases. Download state tax forms free   Your plan must not permit a benefit reduction for a post-separation increase in the social security benefit level or wage base for any participant or beneficiary who is receiving benefits under your plan, or who is separated from service and has nonforfeitable rights to benefits. Download state tax forms free This rule also applies to plans supplementing the benefits provided by other federal or state laws. Download state tax forms free Elective deferrals must be limited. Download state tax forms free   If your plan provides for elective deferrals, it must limit those deferrals to the amount in effect for that particular year. Download state tax forms free See Limit on Elective Deferrals later in this chapter. Download state tax forms free Top-heavy plan requirements. Download state tax forms free   A top-heavy plan is one that mainly favors partners, sole proprietors, and other key employees. Download state tax forms free   A plan is top-heavy for a plan year if, for the preceding plan year, the total value of accrued benefits or account balances of key employees is more than 60% of the total value of accrued benefits or account balances of all employees. Download state tax forms free Additional requirements apply to a top-heavy plan primarily to provide minimum benefits or contributions for non-key employees covered by the plan. Download state tax forms free   Most qualified plans, whether or not top-heavy, must contain provisions that meet the top-heavy requirements and will take effect in plan years in which the plans are top-heavy. Download state tax forms free These qualification requirements for top-heavy plans are explained in section 416 and its regulations. Download state tax forms free SIMPLE and safe harbor 401(k) plan exception. Download state tax forms free   The top-heavy plan requirements do not apply to SIMPLE 401(k) plans, discussed earlier in chapter 3, or to safe harbor 401(k) plans that consist solely of safe harbor contributions, discussed later in this chapter. Download state tax forms free QACAs (discussed later) also are not subject to top-heavy requirements. Download state tax forms free Setting Up a Qualified Plan There are two basic steps in setting up a qualified plan. Download state tax forms free First you adopt a written plan. Download state tax forms free Then you invest the plan assets. Download state tax forms free You, the employer, are responsible for setting up and maintaining the plan. Download state tax forms free If you are self-employed, it is not necessary to have employees besides yourself to sponsor and set up a qualified plan. Download state tax forms free If you have employees, see Participation, under Qualification Rules, earlier. Download state tax forms free Set-up deadline. Download state tax forms free   To take a deduction for contributions for a tax year, your plan must be set up (adopted) by the last day of that year (December 31 for calendar-year employers). Download state tax forms free Credit for startup costs. Download state tax forms free   You may be able to claim a tax credit for part of the ordinary and necessary costs of starting a qualified plan that first became effective in 2013. Download state tax forms free For more information, see Credit for startup costs under Reminders, earlier. Download state tax forms free Adopting a Written Plan You must adopt a written plan. Download state tax forms free The plan can be an IRS-approved master or prototype plan offered by a sponsoring organization. Download state tax forms free Or it can be an individually designed plan. Download state tax forms free Written plan requirement. Download state tax forms free   To qualify, the plan you set up must be in writing and must be communicated to your employees. Download state tax forms free The plan's provisions must be stated in the plan. Download state tax forms free It is not sufficient for the plan to merely refer to a requirement of the Internal Revenue Code. Download state tax forms free Master or prototype plans. Download state tax forms free   Most qualified plans follow a standard form of plan (a master or prototype plan) approved by the IRS. Download state tax forms free Master and prototype plans are plans made available by plan providers for adoption by employers (including self-employed individuals). Download state tax forms free Under a master plan, a single trust or custodial account is established, as part of the plan, for the joint use of all adopting employers. Download state tax forms free Under a prototype plan, a separate trust or custodial account is established for each employer. Download state tax forms free Plan providers. Download state tax forms free   The following organizations generally can provide IRS-approved master or prototype plans. Download state tax forms free Banks (including some savings and loan associations and federally insured credit unions). Download state tax forms free Trade or professional organizations. Download state tax forms free Insurance companies. Download state tax forms free Mutual funds. Download state tax forms free Individually designed plan. Download state tax forms free   If you prefer, you can set up an individually designed plan to meet specific needs. Download state tax forms free Although advance IRS approval is not required, you can apply for approval by paying a fee and requesting a determination letter. Download state tax forms free You may need professional help for this. Download state tax forms free See Rev. Download state tax forms free Proc. Download state tax forms free 2014-6, 2014-1 I. Download state tax forms free R. Download state tax forms free B. Download state tax forms free 198, available at www. Download state tax forms free irs. Download state tax forms free gov/irb/2014-1_IRB/ar10. Download state tax forms free html, as annually updated, that may help you decide whether to apply for approval. Download state tax forms free Internal Revenue Bulletins are available on the IRS website at IRS. Download state tax forms free gov They are also available at most IRS offices and at certain libraries. Download state tax forms free User fee. Download state tax forms free   The fee mentioned earlier for requesting a determination letter does not apply to employers who have 100 or fewer employees who received at least $5,000 of compensation from the employer for the preceding year. Download state tax forms free At least one of them must be a non-highly compensated employee participating in the plan. Download state tax forms free The fee does not apply to requests made by the later of the following dates. Download state tax forms free The end of the 5th plan year the plan is in effect. Download state tax forms free The end of any remedial amendment period for the plan that begins within the first 5 plan years. Download state tax forms free The request cannot be made by the sponsor of a prototype or similar plan the sponsor intends to market to participating employers. Download state tax forms free   For more information about whether the user fee applies, see Rev. Download state tax forms free Proc. Download state tax forms free 2014-8, 2014-1 I. Download state tax forms free R. Download state tax forms free B. Download state tax forms free 242, available at www. Download state tax forms free irs. Download state tax forms free gov/irb/2014-1_IRB/ar12. Download state tax forms free html, as may be annually updated; Notice 2003-49, 2003-32 I. Download state tax forms free R. Download state tax forms free B. Download state tax forms free 294, available at www. Download state tax forms free irs. Download state tax forms free gov/irb/2003-32_IRB/ar13. Download state tax forms free html; and Notice 2011-86, 2011-45 I. Download state tax forms free R. Download state tax forms free B. Download state tax forms free 698, available at www. Download state tax forms free irs. Download state tax forms free gov/irb/2011-45_IRB/ar11. Download state tax forms free html. Download state tax forms free Investing Plan Assets In setting up a qualified plan, you arrange how the plan's funds will be used to build its assets. Download state tax forms free You can establish a trust or custodial account to invest the funds. Download state tax forms free You, the trust, or the custodial account can buy an annuity contract from an insurance company. Download state tax forms free Life insurance can be included only if it is incidental to the retirement benefits. Download state tax forms free You set up a trust by a legal instrument (written document). Download state tax forms free You may need professional help to do this. Download state tax forms free You can set up a custodial account with a bank, savings and loan association, credit union, or other person who can act as the plan trustee. Download state tax forms free You do not need a trust or custodial account, although you can have one, to invest the plan's funds in annuity contracts or face-amount certificates. Download state tax forms free If anyone other than a trustee holds them, however, the contracts or certificates must state they are not transferable. Download state tax forms free Other plan requirements. Download state tax forms free   For information on other important plan requirements, see Qualification Rules , earlier in this chapter. Download state tax forms free Minimum Funding Requirement In general, if your plan is a money purchase pension plan or a defined benefit plan, you must actually pay enough into the plan to satisfy the minimum funding standard for each year. Download state tax forms free Determining the amount needed to satisfy the minimum funding standard for a defined benefit plan is complicated, and you should seek professional help in order to meet these contribution requirements. Download state tax forms free For information on this funding requirement, see section 412 and its regulations. Download state tax forms free Quarterly installments of required contributions. Download state tax forms free   If your plan is a defined benefit plan subject to the minimum funding requirements, you generally must make quarterly installment payments of the required contributions. Download state tax forms free If you do not pay the full installments timely, you may have to pay interest on any underpayment for the period of the underpayment. Download state tax forms free Due dates. Download state tax forms free   The due dates for the installments are 15 days after the end of each quarter. Download state tax forms free For a calendar-year plan, the installments are due April 15, July 15, October 15, and January 15 (of the following year). Download state tax forms free Installment percentage. Download state tax forms free   Each quarterly installment must be 25% of the required annual payment. Download state tax forms free Extended period for making contributions. Download state tax forms free   Additional contributions required to satisfy the minimum funding requirement for a plan year will be considered timely if made by 8½ months after the end of that year. Download state tax forms free Contributions A qualified plan is generally funded by your contributions. Download state tax forms free However, employees participating in the plan may be permitted to make contributions, and you may be permitted to make contributions on your own behalf. Download state tax forms free See Employee Contributions and Elective Deferrals later. Download state tax forms free Contributions deadline. Download state tax forms free   You can make deductible contributions for a tax year up to the due date of your return (plus extensions) for that year. Download state tax forms free Self-employed individual. Download state tax forms free   You can make contributions on behalf of yourself only if you have net earnings (compensation) from self-employment in the trade or business for which the plan was set up. Download state tax forms free Your net earnings must be from your personal services, not from your investments. Download state tax forms free If you have a net loss from self-employment, you cannot make contributions for yourself for the year, even if you can contribute for common-law employees based on their compensation. Download state tax forms free Employer Contributions There are certain limits on the contributions and other annual additions you can make each year for plan participants. Download state tax forms free There are also limits on the amount you can deduct. Download state tax forms free See Deduction Limits , later. Download state tax forms free Limits on Contributions and Benefits Your plan must provide that contributions or benefits cannot exceed certain limits. Download state tax forms free The limits differ depending on whether your plan is a defined contribution plan or a defined benefit plan. Download state tax forms free Defined benefit plan. Download state tax forms free   For 2013, the annual benefit for a participant under a defined benefit plan cannot exceed the lesser of the following amounts. Download state tax forms free 100% of the participant's average compensation for his or her highest 3 consecutive calendar years. Download state tax forms free $205,000 ($210,000 for 2014). Download state tax forms free Defined contribution plan. Download state tax forms free   For 2013, a defined contribution plan's annual contributions and other additions (excluding earnings) to the account of a participant cannot exceed the lesser of the following amounts. Download state tax forms free 100% of the participant's compensation. Download state tax forms free $51,000 ($52,000 for 2014). Download state tax forms free   Catch-up contributions (discussed later under Limit on Elective Deferrals) are not subject to the above limit. Download state tax forms free Employee Contributions Participants may be permitted to make nondeductible contributions to a plan in addition to your contributions. Download state tax forms free Even though these employee contributions are not deductible, the earnings on them are tax free until distributed in later years. Download state tax forms free Also, these contributions must satisfy the actual contribution percentage (ACP) test of section 401(m)(2), a nondiscrimination test that applies to employee contributions and matching contributions. Download state tax forms free See Regulations sections 1. Download state tax forms free 401(k)-2 and 1. Download state tax forms free 401(m)-2 for further guidance relating to the nondiscrimination rules under sections 401(k) and 401(m). Download state tax forms free When Contributions Are Considered Made You generally apply your plan contributions to the year in which you make them. Download state tax forms free But you can apply them to the previous year if all the following requirements are met. Download state tax forms free You make them by the due date of your tax return for the previous year (plus extensions). Download state tax forms free The plan was established by the end of the previous year. Download state tax forms free The plan treats the contributions as though it had received them on the last day of the previous year. Download state tax forms free You do either of the following. Download state tax forms free You specify in writing to the plan administrator or trustee that the contributions apply to the previous year. Download state tax forms free You deduct the contributions on your tax return for the previous year. Download state tax forms free A partnership shows contributions for partners on Form 1065. Download state tax forms free Employer's promissory note. Download state tax forms free   Your promissory note made out to the plan is not a payment that qualifies for the deduction. Download state tax forms free Also, issuing this note is a prohibited transaction subject to tax. Download state tax forms free See Prohibited Transactions , later. Download state tax forms free Employer Deduction You can usually deduct, subject to limits, contributions you make to a qualified plan, including those made for your own retirement. Download state tax forms free The contributions (and earnings and gains on them) are generally tax free until distributed by the plan. Download state tax forms free Deduction Limits The deduction limit for your contributions to a qualified plan depends on the kind of plan you have. Download state tax forms free Defined contribution plans. Download state tax forms free   The deduction for contributions to a defined contribution plan (profit-sharing plan or money purchase pension plan) cannot be more than 25% of the compensation paid (or accrued) during the year to your eligible employees participating in the plan. Download state tax forms free If you are self-employed, you must reduce this limit in figuring the deduction for contributions you make for your own account. Download state tax forms free See Deduction Limit for Self-Employed Individuals , later. Download state tax forms free   When figuring the deduction limit, the following rules apply. Download state tax forms free Elective deferrals (discussed later) are not subject to the limit. Download state tax forms free Compensation includes elective deferrals. Download state tax forms free The maximum compensation that can be taken into account for each employee in 2013 is $255,000 ($260,000 for 2014). Download state tax forms free Defined benefit plans. Download state tax forms free   The deduction for contributions to a defined benefit plan is based on actuarial assumptions and computations. Download state tax forms free Consequently, an actuary must figure your deduction limit. Download state tax forms free    In figuring the deduction for contributions, you cannot take into account any contributions or benefits that are more than the limits discussed earlier under Limits on Contributions and Benefits, earlier. Download state tax forms free Table 4–1. Download state tax forms free Carryover of Excess Contributions Illustrated—Profit-Sharing Plan (000's omitted) Year Participants' compensation Participants' share of required contribution (10% of annual profit) Deductible  limit for current year (25% of compensation) Contribution Excess contribution carryover used1 Total  deduction including carryovers Excess contribution carryover available at end of year 2010 $1,000 $100 $250 $100 $ 0 $100 $ 0 2011 400 165 100 165 0 100 65 2012 500 100 125 100 25 125 40 2013 600 100 150 100 40 140 0  1There were no carryovers from years before 2010. Download state tax forms free Deduction Limit for Self-Employed Individuals If you make contributions for yourself, you need to make a special computation to figure your maximum deduction for these contributions. Download state tax forms free Compensation is your net earnings from self-employment, defined in chapter 1. Download state tax forms free This definition takes into account both the following items. Download state tax forms free The deduction for the deductible part of your self-employment tax. Download state tax forms free The deduction for contributions on your behalf to the plan. Download state tax forms free The deduction for your own contributions and your net earnings depend on each other. Download state tax forms free For this reason, you determine the deduction for your own contributions indirectly by reducing the contribution rate called for in your plan. Download state tax forms free To do this, use either the Rate Table for Self-Employed or the Rate Worksheet for Self-Employed in chapter 5. Download state tax forms free Then figure your maximum deduction by using the Deduction Worksheet for Self-Employed in chapter 5. Download state tax forms free Where To Deduct Contributions Deduct the contributions you make for your common-law employees on your tax return. Download state tax forms free For example, sole proprietors deduct them on Schedule C (Form 1040) or Schedule F (Form 1040); partnerships deduct them on Form 1065; and corporations deduct them on Form 1120, or Form 1120S. Download state tax forms free Sole proprietors and partners deduct contributions for themselves on line 28 of Form 1040. Download state tax forms free (If you are a partner, contributions for yourself are shown on the Schedule K-1 (Form 1065) you get from the partnership. Download state tax forms free ) Carryover of Excess Contributions If you contribute more to the plans than you can deduct for the year, you can carry over and deduct the difference in later years, combined with your contributions for those years. Download state tax forms free Your combined deduction in a later year is limited to 25% of the participating employees' compensation for that year. Download state tax forms free For purposes of this limit, a SEP is treated as a profit-sharing (defined contribution) plan. Download state tax forms free However, this percentage limit must be reduced to figure your maximum deduction for contributions you make for yourself. Download state tax forms free See Deduction Limit for Self-Employed Individuals, earlier. Download state tax forms free The amount you carry over and deduct may be subject to the excise tax discussed next. Download state tax forms free Table 4-1, earlier, illustrates the carryover of excess contributions to a profit-sharing plan. Download state tax forms free Excise Tax for Nondeductible (Excess) Contributions If you contribute more than your deduction limit to a retirement plan, you have made nondeductible contributions and you may be liable for an excise tax. Download state tax forms free In general, a 10% excise tax applies to nondeductible contributions made to qualified pension and profit-sharing plans and to SEPs. Download state tax forms free Special rule for self-employed individuals. Download state tax forms free   The 10% excise tax does not apply to any contribution made to meet the minimum funding requirements in a money purchase pension plan or a defined benefit plan. Download state tax forms free Even if that contribution is more than your earned income from the trade or business for which the plan is set up, the difference is not subject to this excise tax. Download state tax forms free See Minimum Funding Requirement , earlier. Download state tax forms free Reporting the tax. Download state tax forms free   You must report the tax on your nondeductible contributions on Form 5330. Download state tax forms free Form 5330 includes a computation of the tax. Download state tax forms free See the separate instructions for completing the form. Download state tax forms free Elective Deferrals (401(k) Plans) Your qualified plan can include a cash or deferred arrangement under which participants can choose to have you contribute part of their before-tax compensation to the plan rather than receive the compensation in cash. Download state tax forms free A plan with this type of arrangement is popularly known as a “401(k) plan. Download state tax forms free ” (As a self-employed individual participating in the plan, you can contribute part of your before-tax net earnings from the business. Download state tax forms free ) This contribution is called an “elective deferral” because participants choose (elect) to defer receipt of the money. Download state tax forms free In general, a qualified plan can include a cash or deferred arrangement only if the qualified plan is one of the following plans. Download state tax forms free A profit-sharing plan. Download state tax forms free A money purchase pension plan in existence on June 27, 1974, that included a salary reduction arrangement on that date. Download state tax forms free Partnership. Download state tax forms free   A partnership can have a 401(k) plan. Download state tax forms free Restriction on conditions of participation. Download state tax forms free   The plan cannot require, as a condition of participation, that an employee complete more than 1 year of service. Download state tax forms free Matching contributions. Download state tax forms free   If your plan permits, you can make matching contributions for an employee who makes an elective deferral to your 401(k) plan. Download state tax forms free For example, the plan might provide that you will contribute 50 cents for each dollar your participating employees choose to defer under your 401(k) plan. Download state tax forms free Matching contributions are generally subject to the ACP test discussed earlier under Employee Contributions. Download state tax forms free Nonelective contributions. Download state tax forms free   You can also make contributions (other than matching contributions) for your participating employees without giving them the choice to take cash instead. Download state tax forms free These are called nonelective contributions. Download state tax forms free Employee compensation limit. Download state tax forms free   No more than $255,000 of the employee's compensation can be taken into account when figuring contributions other than elective deferrals in 2013. Download state tax forms free This limit is $260,000 in 2014. Download state tax forms free SIMPLE 401(k) plan. Download state tax forms free   If you had 100 or fewer employees who earned $5,000 or more in compensation during the preceding year, you may be able to set up a SIMPLE 401(k) plan. Download state tax forms free A SIMPLE 401(k) plan is not subject to the nondiscrimination and top-heavy plan requirements discussed earlier under Qualification Rules. Download state tax forms free For details about SIMPLE 401(k) plans, see SIMPLE 401(k) Plan in chapter 3. Download state tax forms free Distributions. Download state tax forms free   Certain rules apply to distributions from 401(k) plans. Download state tax forms free See Distributions From 401(k) Plans , later. Download state tax forms free Limit on Elective Deferrals There is a limit on the amount an employee can defer each year under these plans. Download state tax forms free This limit applies without regard to community property laws. Download state tax forms free Your plan must provide that your employees cannot defer more than the limit that applies for a particular year. Download state tax forms free For 2013 and 2014, the basic limit on elective deferrals is $17,500. Download state tax forms free This limit applies to all salary reduction contributions and elective deferrals. Download state tax forms free If, in conjunction with other plans, the deferral limit is exceeded, the difference is included in the employee's gross income. Download state tax forms free Catch-up contributions. Download state tax forms free   A 401(k) plan can permit participants who are age 50 or over at the end of the calendar year to also make catch-up contributions. Download state tax forms free The catch-up contribution limit for 2013 and 2014 is $5,500. Download state tax forms free Elective deferrals are not treated as catch-up contributions for 2013 until they exceed the $17,500 limit, the actual deferral percentage (ADP) test limit of section 401(k)(3), or the plan limit (if any). Download state tax forms free However, the catch-up contribution a participant can make for a year cannot exceed the lesser of the following amounts. Download state tax forms free The catch-up contribution limit. Download state tax forms free The excess of the participant's compensation over the elective deferrals that are not catch-up contributions. Download state tax forms free Treatment of contributions. Download state tax forms free   Your contributions to your own 401(k) plan are generally deductible by you for the year they are contributed to the plan. Download state tax forms free Matching or nonelective contributions made to the plan are also deductible by you in the year of contribution. Download state tax forms free Your employees' elective deferrals other than designated Roth contributions are tax free until distributed from the plan. Download state tax forms free Elective deferrals are included in wages for social security, Medicare, and federal unemployment (FUTA) tax. Download state tax forms free Forfeiture. Download state tax forms free   Employees have a nonforfeitable right at all times to their accrued benefit attributable to elective deferrals. Download state tax forms free Reporting on Form W-2. Download state tax forms free   Do not include elective deferrals in the “Wages, tips, other compensation” box of Form W-2. Download state tax forms free You must, however, include them in the “Social security wages” and “Medicare wages and tips” boxes. Download state tax forms free You must also include them in box 12. Download state tax forms free Mark the “Retirement plan” checkbox in box 13. Download state tax forms free For more information, see the Form W-2 instructions. Download state tax forms free Automatic Enrollment Your 401(k) plan can have an automatic enrollment feature. Download state tax forms free Under this feature, you can automatically reduce an employee's pay by a fixed percentage and contribute that amount to the 401(k) plan on his or her behalf unless the employee affirmatively chooses not to have his or her pay reduced or chooses to have it reduced by a different percentage. Download state tax forms free These contributions are elective deferrals. Download state tax forms free An automatic enrollment feature will encourage employees' saving for retirement and will help your plan pass nondiscrimination testing (if applicable). Download state tax forms free For more information, see Publication 4674, Automatic Enrollment 401(k) Plans for Small Businesses. Download state tax forms free Eligible automatic contribution arrangement. Download state tax forms free   Under an eligible automatic contribution arrangement (EACA), a participant is treated as having elected to have the employer make contributions in an amount equal to a uniform percentage of compensation. Download state tax forms free This automatic election will remain in place until the participant specifically elects not to have such deferral percentage made (or elects a different percentage). Download state tax forms free There is no required deferral percentage. Download state tax forms free Withdrawals. Download state tax forms free   Under an EACA, you may allow participants to withdraw their automatic contributions to the plan if certain conditions are met. Download state tax forms free The participant must elect the withdrawal no later than 90 days after the date of the first elective contributions under the EACA. Download state tax forms free The participant must withdraw the entire amount of EACA default contributions, including any earnings thereon. Download state tax forms free   If the plan allows withdrawals under the EACA, the amount of the withdrawal other than the amount of any designated Roth contributions must be included in the employee's gross income for the tax year in which the distribution is made. Download state tax forms free The additional 10% tax on early distributions will not apply to the distribution. Download state tax forms free Notice requirement. Download state tax forms free   Under an EACA, employees must be given written notice of the terms of the EACA within a reasonable period of time before each plan year. Download state tax forms free The notice must be written in a manner calculated to be understood by the average employee and be sufficiently accurate and comprehensive in order to apprise the employee of his or her rights and obligations under the EACA. Download state tax forms free The notice must include an explanation of the employee's right to elect not to have elective contributions made on his or her behalf, or to elect a different percentage, and the employee must be given a reasonable period of time after receipt of the notice before the first elective contribution is made. Download state tax forms free The notice also must explain how contributions will be invested in the absence of an investment election by the employee. Download state tax forms free Qualified automatic contribution arrangement. Download state tax forms free    A qualified automatic contribution arrangement (QACA) is a type of safe harbor plan. Download state tax forms free It contains an automatic enrollment feature, and mandatory employer contributions are required. Download state tax forms free If your plan includes a QACA, it will not be subject to the ADP test (discussed later) nor the top-heavy requirements (discussed earlier). Download state tax forms free Additionally, your plan will not be subject to the actual contribution percentage (ACP) test if certain additional requirements are met. Download state tax forms free Under a QACA, each employee who is eligible to participate in the plan will be treated as having elected to make elective deferral contributions equal to a certain default percentage of compensation. Download state tax forms free In order to not have default elective deferrals made, an employee must make an affirmative election specifying a deferral percentage (including zero, if desired). Download state tax forms free If an employee does not make an affirmative election, the default deferral percentage must meet the following conditions. Download state tax forms free It must be applied uniformly. Download state tax forms free It must not exceed 10%. Download state tax forms free It must be at least 3% in the first plan year it applies to an employee and through the end of the following year. Download state tax forms free It must increase to at least 4% in the following plan year. Download state tax forms free It must increase to at least 5% in the following plan year. Download state tax forms free It must increase to at least 6% in subsequent plan years. Download state tax forms free Matching or nonelective contributions. Download state tax forms free   Under the terms of the QACA, you must make either matching or nonelective contributions according to the following terms. Download state tax forms free Matching contributions. Download state tax forms free You must make matching contributions on behalf of each non-highly compensated employee in the following amounts. Download state tax forms free An amount equal to 100% of elective deferrals, up to 1% of compensation. Download state tax forms free An amount equal to 50% of elective deferrals, from 1% up to 6% of compensation. Download state tax forms free Other formulas may be used as long as they are at least as favorable to non-highly compensated employees. Download state tax forms free The rate of matching contributions for highly compensated employees, including yourself, must not exceed the rates for non-highly compensated employees. Download state tax forms free Nonelective contributions. Download state tax forms free You must make nonelective contributions on behalf of every non-highly compensated employee eligible to participate in the plan, regardless of whether they elected to participate, in an amount equal to at least 3% of their compensation. Download state tax forms free Vesting requirements. Download state tax forms free   All accrued benefits attributed to matching or nonelective contributions under the QACA must be 100% vested for all employees who complete 2 years of service. Download state tax forms free These contributions are subject to special withdrawal restrictions, discussed later. Download state tax forms free Notice requirements. Download state tax forms free   Each employee eligible to participate in the QACA must receive written notice of their rights and obligations under the QACA, within a reasonable period before each plan year. Download state tax forms free The notice must be written in a manner calculated to be understood by the average employee, and it must be accurate and comprehensive. Download state tax forms free The notice must explain their right to elect not to have elective contributions made on their behalf, or to have contributions made at a different percentage than the default percentage. Download state tax forms free Additionally, the notice must explain how contributions will be invested in the absence of any investment election by the employee. Download state tax forms free The employee must have a reasonable period of time after receiving the notice to make such contribution and investment elections prior to the first contributions under the QACA. Download state tax forms free Treatment of Excess Deferrals If the total of an employee's deferrals is more than the limit for 2013, the employee can have the difference (called an excess deferral) paid out of any of the plans that permit these distributions. Download state tax forms free He or she must notify the plan by April 15, 2014 (or an earlier date specified in the plan), of the amount to be paid from each plan. Download state tax forms free The plan must then pay the employee that amount, plus earnings on the amount through the end of 2013, by April 15, 2014. Download state tax forms free Excess withdrawn by April 15. Download state tax forms free   If the employee takes out the excess deferral by April 15, 2014, it is not reported again by including it in the employee's gross income for 2014. Download state tax forms free However, any income earned in 2013 on the excess deferral taken out is taxable in the tax year in which it is taken out. Download state tax forms free The distribution is not subject to the additional 10% tax on early distributions. Download state tax forms free   If the employee takes out part of the excess deferral and the income on it, the distribution is treated as made proportionately from the excess deferral and the income. Download state tax forms free   Even if the employee takes out the excess deferral by April 15, the amount will be considered for purposes of nondiscrimination testing requirements of the plan, unless the distributed amount is for a non-highly compensated employee who participates in only one employer's 401(k) plan or plans. Download state tax forms free Excess not withdrawn by April 15. Download state tax forms free   If the employee does not take out the excess deferral by April 15, 2014, the excess, though taxable in 2013, is not included in the employee's cost basis in figuring the taxable amount of any eventual distributions under the plan. Download state tax forms free In effect, an excess deferral left in the plan is taxed twice, once when contributed and again when distributed. Download state tax forms free Also, if the employee's excess deferral is allowed to stay in the plan and the employee participates in no other employer's plan, the plan can be disqualified. Download state tax forms free Reporting corrective distributions on Form 1099-R. Download state tax forms free   Report corrective distributions of excess deferrals (including any earnings) on Form 1099-R. Download state tax forms free For specific information about reporting corrective distributions, see the Instructions for Forms 1099-R and 5498. Download state tax forms free Tax on excess contributions of highly compensated employees. Download state tax forms free   The law provides tests to detect discrimination in a plan. Download state tax forms free If tests, such as the actual deferral percentage test (ADP test) (see section 401(k)(3)) and the actual contribution percentage test (ACP test) (see section 401(m)(2)), show that contributions for highly compensated employees are more than the test limits for these contributions, the employer may have to pay a 10% excise tax. Download state tax forms free Report the tax on Form 5330. Download state tax forms free The ADP test does not apply to a safe harbor 401(k) plan (discussed next) nor to a QACA. Download state tax forms free Also, the ACP test does not apply to these plans if certain additional requirements are met. Download state tax forms free   The tax for the year is 10% of the excess contributions for the plan year ending in your tax year. Download state tax forms free Excess contributions are elective deferrals, employee contributions, or employer matching or nonelective contributions that are more than the amount permitted under the ADP test or the ACP test. Download state tax forms free   See Regulations sections 1. Download state tax forms free 401(k)-2 and 1. Download state tax forms free 401(m)-2 for further guidance relating to the nondiscrimination rules under sections 401(k) and 401(m). Download state tax forms free    If the plan fails the ADP or ACP testing, and the failure is not corrected by the end of the next plan year, the plan can be disqualified. Download state tax forms free Safe harbor 401(k) plan. Download state tax forms free If you meet the requirements for a safe harbor 401(k) plan, you do not have to satisfy the ADP test, nor the ACP test, if certain additional requirements are met. Download state tax forms free For your plan to be a safe harbor plan, you must meet the following conditions. Download state tax forms free Matching or nonelective contributions. Download state tax forms free You must make matching or nonelective contributions according to one of the following formulas. Download state tax forms free Matching contributions. Download state tax forms free You must make matching contributions according to the following rules. Download state tax forms free You must contribute an amount equal to 100% of each non-highly compensated employee's elective deferrals, up to 3% of compensation. Download state tax forms free You must contribute an amount equal to 50% of each non-highly compensated employee's elective deferrals, from 3% up to 5% of compensation. Download state tax forms free The rate of matching contributions for highly compensated employees, including yourself, must not exceed the rates for non-highly compensated employees. Download state tax forms free Nonelective contributions. Download state tax forms free You must make nonelective contributions, without regard to whether the employee made elective deferrals, on behalf of all non-highly compensated employees eligible to participate in the plan, equal to at least 3% of the employee's compensation. Download state tax forms free These mandatory matching and nonelective contributions must be immediately 100% vested and are subject to special withdrawal restrictions. Download state tax forms free Notice requirement. Download state tax forms free You must give eligible employees written notice of their rights and obligations with regard to contributions under the plan, within a reasonable period before the plan year. Download state tax forms free The other requirements for a 401(k) plan, including withdrawal and vesting rules, must also be met for your plan to qualify as a safe harbor 401(k) plan. Download state tax forms free Qualified Roth Contribution Program Under this program an eligible employee can designate all or a portion of his or her elective deferrals as after-tax Roth contributions. Download state tax forms free Elective deferrals designated as Roth contributions must be maintained in a separate Roth account. Download state tax forms free However, unlike other elective deferrals, designated Roth contributions are not excluded from employees' gross income, but qualified distributions from a Roth account are excluded from employees' gross income. Download state tax forms free Elective Deferrals Under a qualified Roth contribution program, the amount of elective deferrals that an employee may designate as a Roth contribution is limited to the maximum amount of elective deferrals excludable from gross income for the year (for 2013 and 2014, $17,500 if under age 50 and $23,000 if age 50 or over) less the total amount of the employee's elective deferrals not designated as Roth contributions. Download state tax forms free Designated Roth deferrals are treated the same as pre-tax elective deferrals for most purposes, including: The annual individual elective deferral limit (total of all designated Roth contributions and traditional, pre-tax elective deferrals) of $17,500 for 2013 and 2014, with an additional $5,500 if age 50 or over for 2013 and 2014, Determining the maximum employee and employer annual contributions of the lesser of 100% of compensation or $51,000 for 2013 ($52,000 for 2014), Nondiscrimination testing, Required distributions, and Elective deferrals not taken into account for purposes of deduction limits. Download state tax forms free Qualified Distributions A qualified distribution is a distribution that is made after the employee's nonexclusion period and: On or after the employee attains age   59½, On account of the employee's being disabled, or On or after the employee's death. Download state tax forms free An employee's nonexclusion period for a plan is the 5-tax-year period beginning with the earlier of the following tax years. Download state tax forms free The first tax year in which the employee made a contribution to his or her Roth account in the plan, or If a rollover contribution was made to the employee's designated Roth account from a designated Roth account previously established for the employee under another plan, then the first tax year the employee made a designated Roth contribution to the previously established account. Download state tax forms free Rollover. Download state tax forms free   Beginning September 28, 2010, a rollover from another account can be made to a designated Roth account in the same plan. Download state tax forms free For additional information on these in-plan Roth rollovers, see Notice 2010-84, 2010-51 I. Download state tax forms free R. Download state tax forms free B. Download state tax forms free 872, available at www. Download state tax forms free irs. Download state tax forms free gov/irb/2010-51_IRB/ar11. Download state tax forms free html, and Notice 2013-74. Download state tax forms free A distribution from a designated Roth account can only be rolled over to another designated Roth account or a Roth IRA. Download state tax forms free Rollover amounts do not apply toward the annual deferral limit. Download state tax forms free Reporting Requirements You must report a contribution to a Roth account on Form W-2 and a distribution from a Roth account on Form 1099-R. Download state tax forms free See the Form W-2 and 1099-R instructions for detailed information. Download state tax forms free Distributions Amounts paid to plan participants from a qualified plan are called distributions. Download state tax forms free Distributions may be nonperiodic, such as lump-sum distributions, or periodic, such as annuity payments. Download state tax forms free Also, certain loans may be treated as distributions. Download state tax forms free See Loans Treated as Distributions in Publication 575. Download state tax forms free Required Distributions A qualified plan must provide that each participant will either: Receive his or her entire interest (benefits) in the plan by the required beginning date (defined later), or Begin receiving regular periodic distributions by the required beginning date in annual amounts calculated to distribute the participant's entire interest (benefits) over his or her life expectancy or over the joint life expectancy of the participant and the designated beneficiary (or over a shorter period). Download state tax forms free These distribution rules apply individually to each qualified plan. Download state tax forms free You cannot satisfy the requirement for one plan by taking a distribution from another. Download state tax forms free The plan must provide that these rules override any inconsistent distribution options previously offered. Download state tax forms free Minimum distribution. Download state tax forms free   If the account balance of a qualified plan participant is to be distributed (other than as an annuity), the plan administrator must figure the minimum amount required to be distributed each distribution calendar year. Download state tax forms free This minimum is figured by dividing the account balance by the applicable life expectancy. Download state tax forms free The plan administrator can use the life expectancy tables in Appendix C of Publication 590 for this purpose. Download state tax forms free For more information on figuring the minimum distribution, see Tax on Excess Accumulation in Publication 575. Download state tax forms free Required beginning date. Download state tax forms free   Generally, each participant must receive his or her entire benefits in the plan or begin to receive periodic distributions of benefits from the plan by the required beginning date. Download state tax forms free   A participant must begin to receive distributions from his or her qualified retirement plan by April 1 of the first year after the later of the following years. Download state tax forms free Calendar year in which he or she reaches age 70½. Download state tax forms free Calendar year in which he or she retires from employment with the employer maintaining the plan. Download state tax forms free However, the plan may require the participant to begin receiving distributions by April 1 of the year after the participant reaches age 70½ even if the participant has not retired. Download state tax forms free   If the participant is a 5% owner of the employer maintaining the plan, the participant must begin receiving distributions by April 1 of the first year after the calendar year in which the participant reached age 70½. Download state tax forms free For more information, see Tax on Excess Accumulation in Publication 575. Download state tax forms free Distributions after the starting year. Download state tax forms free   The distribution required to be made by April 1 is treated as a distribution for the starting year. Download state tax forms free (The starting year is the year in which the participant meets (1) or (2) above, whichever applies. Download state tax forms free ) After the starting year, the participant must receive the required distribution for each year by December 31 of that year. Download state tax forms free If no distribution is made in the starting year, required distributions for 2 years must be made in the next year (one by April 1 and one by December 31). Download state tax forms free Distributions after participant's death. Download state tax forms free   See Publication 575 for the special rules covering distributions made after the death of a participant. Download state tax forms free Distributions From 401(k) Plans Generally, distributions cannot be made until one of the following occurs. Download state tax forms free The employee retires, dies, becomes disabled, or otherwise severs employment. Download state tax forms free The plan ends and no other defined contribution plan is established or continued. Download state tax forms free In the case of a 401(k) plan that is part of a profit-sharing plan, the employee reaches age 59½ or suffers financial hardship. Download state tax forms free For the rules on hardship distributions, including the limits on them, see Regulations section 1. Download state tax forms free 401(k)-1(d). Download state tax forms free The employee becomes eligible for a qualified reservist distribution (defined next). Download state tax forms free Certain distributions listed above may be subject to the tax on early distributions discussed later. Download state tax forms free Qualified reservist distributions. Download state tax forms free   A qualified reservist distribution is a distribution from an IRA or an elective deferral account made after September 11, 2001, to a military reservist or a member of the National Guard who has been called to active duty for at least 180 days or for an indefinite period. Download state tax forms free All or part of a qualified reservist distribution can be recontributed to an IRA. Download state tax forms free The additional 10% tax on early distributions does not apply to a qualified reservist distribution. Download state tax forms free Tax Treatment of Distributions Distributions from a qualified plan minus a prorated part of any cost basis are subject to income tax in the year they are distributed. Download state tax forms free Since most recipients have no cost basis, a distribution is generally fully taxable. Download state tax forms free An exception is a distribution that is properly rolled over as discussed under Rollover, next. Download state tax forms free The tax treatment of distributions depends on whether they are made periodically over several years or life (periodic distributions) or are nonperiodic distributions. Download state tax forms free See Taxation of Periodic Payments and Taxation of Nonperiodic Payments in Publication 575 for a detailed description of how distributions are taxed, including the 10-year tax option or capital gain treatment of a lump-sum distribution. Download state tax forms free Note. Download state tax forms free A recipient of a distribution from a designated Roth account will have a cost basis since designated Roth contributions are made on an after-tax basis. Download state tax forms free Also, a distribution from a designated Roth account is entirely tax-free if certain conditions are met. Download state tax forms free See Qualified distributions under Qualified Roth Contribution Program, earlier. Download state tax forms free Rollover. Download state tax forms free   The recipient of an eligible rollover distribution from a qualified plan can defer the tax on it by rolling it over into a traditional IRA or another eligible retirement plan. Download state tax forms free However, it may be subject to withholding as discussed under Withholding requirement, later. Download state tax forms free A rollover can also be made to a Roth IRA, in which case, any previously untaxed amounts are includible in gross income unless the rollover is from a designated Roth account. Download state tax forms free Eligible rollover distribution. Download state tax forms free   This is a distribution of all or any part of an employee's balance in a qualified retirement plan that is not any of the following. Download state tax forms free A required minimum distribution. Download state tax forms free See Required Distributions , earlier. Download state tax forms free Any of a series of substantially equal payments made at least once a year over any of the following periods. Download state tax forms free The employee's life or life expectancy. Download state tax forms free The joint lives or life expectancies of the employee and beneficiary. Download state tax forms free A period of 10 years or longer. Download state tax forms free A hardship distribution. Download state tax forms free The portion of a distribution that represents the return of an employee's nondeductible contributions to the plan. Download state tax forms free See Employee Contributions , earlier, and Rollover of nontaxable amounts, next. Download state tax forms free Loans treated as distributions. Download state tax forms free Dividends on employer securities. Download state tax forms free The cost of any life insurance coverage provided under a qualified retirement plan. Download state tax forms free Similar items designated by the IRS in published guidance. Download state tax forms free See, for example, the Instructions for Forms 1099-R and 5498. Download state tax forms free Rollover of nontaxable amounts. Download state tax forms free   You may be able to roll over the nontaxable part of a distribution to another qualified retirement plan or a section 403(b) plan, or to an IRA. Download state tax forms free If the rollover is to a qualified retirement plan or a section 403(b) plan that separately accounts for the taxable and nontaxable parts of the rollover, the transfer must be made through a direct (trustee-to-trustee) rollover. Download state tax forms free If the rollover is to an IRA, the transfer can be made by any rollover method. Download state tax forms free Note. Download state tax forms free A distribution from a designated Roth account can be rolled over to another designated Roth account or to a Roth IRA. Download state tax forms free If the rollover is to a Roth IRA, it can be rolled over by any rollover method, but if the rollover is to another designated Roth account, it must be rolled over directly (trustee-to-trustee). Download state tax forms free More information. Download state tax forms free   For more information about rollovers, see Rollovers in Pubs. Download state tax forms free 575 and 590. Download state tax forms free Withholding requirement. Download state tax forms free   If, during a year, a qualified plan pays to a participant one or more eligible rollover distributions (defined earlier) that are reasonably expected to total $200 or more, the payor must withhold 20% of the taxable portion of each distribution for federal income tax. Download state tax forms free Exceptions. Download state tax forms free   If, instead of having the distribution paid to him or her, the participant chooses to have the plan pay it directly to an IRA or another eligible retirement plan (a direct rollover), no withholding is required. Download state tax forms free   If the distribution is not an eligible rollover distribution, defined earlier, the 20% withholding requirement does not apply. Download state tax forms free Other withholding rules apply to distributions that are not eligible rollover distributions, such as long-term periodic distributions and required distributions (periodic or nonperiodic). Download state tax forms free However, the participant can choose not to have tax withheld from these distributions. Download state tax forms free If the participant does not make this choice, the following withholding rules apply. Download state tax forms free For periodic distributions, withholding is based on their treatment as wages. Download state tax forms free For nonperiodic distributions, 10% of the taxable part is withheld. Download state tax forms free Estimated tax payments. Download state tax forms free   If no income tax is withheld or not enough tax is withheld, the recipient of a distribution may have to make estimated tax payments. Download state tax forms free For more information, see Withholding Tax and Estimated Tax in Publication 575. Download state tax forms free Section 402(f) Notice. Download state tax forms free   If a distribution is an eligible rollover distribution, as defined earlier, you must provide a written notice to the recipient that explains the following rules regarding such distributions. Download state tax forms free That the distribution may be directly transferred to an eligible retirement plan and information about which distributions are eligible for this direct transfer. Download state tax forms free That tax will be withheld from the distribution if it is not directly transferred to an eligible retirement plan. Download state tax forms free That the distribution will not be subject to tax if transferred to an eligible retirement plan within 60 days after the date the recipient receives the distribution. Download state tax forms free Certain other rules that may be applicable. Download state tax forms free   Notice 2009-68, 2009-39 I. Download state tax forms free R. Download state tax forms free B. Download state tax forms free 423, available at www. Download state tax forms free irs. Download state tax forms free gov/irb/2009-39_IRB/ar14. Download state tax forms free html, contains two updated safe harbor section 402(f) notices that plan administrators may provide recipients of eligible rollover distributions. Download state tax forms free If the plan allows in-plan Roth rollovers, the 402(f) notice must be amended to reflect this. Download state tax forms free Notice 2010-84 contains guidance on how to modify a 402(f) notice for in-plan Roth rollovers. Download state tax forms free Timing of notice. Download state tax forms free   The notice generally must be provided no less than 30 days and no more than 180 days before the date of a distribution. Download state tax forms free Method of notice. Download state tax forms free   The written notice must be provided individually to each distributee of an eligible rollover distribution. Download state tax forms free Posting of the notice is not sufficient. Download state tax forms free However, the written requirement may be satisfied through the use of electronic media if certain additional conditions are met. Download state tax forms free See Regulations section 1. Download state tax forms free 401(a)-21. Download state tax forms free Tax on failure to give notice. Download state tax forms free   Failure to give a 402(f) notice will result in a tax of $100 for each failure, with a total not exceeding $50,000 per calendar year. Download state tax forms free The tax will not be imposed if it is shown that such failure is due to reasonable cause and not to willful neglect. Download state tax forms free Tax on Early Distributions If a distribution is made to an employee under the plan before he or she reaches age 59½, the employee may have to pay a 10% additional tax on the distribution. Download state tax forms free This tax applies to the amount received that the employee must include in income. Download state tax forms free Exceptions. Download state tax forms free   The 10% tax will not apply if distributions before age 59½ are made in any of the following circumstances. Download state tax forms free Made to a beneficiary (or to the estate of the employee) on or after the death of the employee. Download state tax forms free Made due to the employee having a qualifying disability. Download state tax forms free Made as part of a series of substantially equal periodic payments beginning after separation from service and made at least annually for the life or life expectancy of the employee or the joint lives or life expectancies of the employee and his or her designated beneficiary. Download state tax forms free (The payments under this exception, except in the case of death or disability, must continue for at least 5 years or until the employee reaches age 59½, whichever is the longer period. Download state tax forms free ) Made to an employee after separation from service if the separation occurred during o
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More Taxpayers Filing from Home Computers in 2014, Many Taxpayers Eligible to Use Free File

IR-2014-28, March 13, 2014

WASHINGTON — More than 27 million taxpayers have filed their tax returns from home computers so far this year, an increase of almost 6 percent compared to last year.

These 27 million taxpayers used a variety of software products to prepare and e-file their own returns. However, the IRS reminds people that they can prepare and e-file their federal tax returns online for free through Free File at IRS.gov. Free File has an option for almost everyone, either through brand-name software or online fillable forms.

The Free File program is a public-private partnership between the IRS and the Free File Alliance, LLC. The Alliance is a consortium of 14 leading tax software providers who make their products available exclusively at IRS.gov. All Free File members meet security requirements and use the latest in encryption technology to protect taxpayer information.

Seventy percent of taxpayers are eligible for easy-to-use Free File software because their income was $58,000 or less in 2013. People who made more than $58,000 and who are comfortable preparing their own returns can use Free File Fillable Forms, the electronic version of IRS paper forms.

Each Free File software provider sets its own criteria for eligibility, generally based on income, age, state residency or military service. However, taxpayers can quickly find a match by using the “help me find Free File software” tool. Or, taxpayers can review all providers and their offers. Some software providers also offer state tax software and display on their landing pages whether it is free or if there is a fee.   

Free File Fillable Forms is more basic, similar to completing a paper Form 1040. The program performs some math calculations and provides links to some IRS publications. It also can be filed electronically for free. However, it does not support any state tax returns.

The total number of individual income tax returns e-filed so far this year is 62.2 million. E-file includes both returns filed from home computers and returns e-filed by professional tax return preparers.  [The filing season statistics table follows.]

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2014 FILING SEASON STATISTICS

Cumulative statistics comparing 3/08/13 and 3/07/14

Individual Income Tax Returns:

2013

2014

% Change

Total Receipts

67,143,000

67,183,000

0.1

Total Processed

60,944,000

65,662,000

 7.7

 

 

 

 

E-filing Receipts:

 

 

 

TOTAL           

61,488,000

62,213,000

1.2

Tax Professionals

35,585,000

34,816,000

-2.2

Self-prepared

25,903,000

27,397,000

5.8

 

 

 

 

Web Usage:

 

 

 

Visits to IRS.gov

197,651,780

181,196,235

-8.3

 

 

 

 

Total Refunds:

 

 

 

Number

53,447,000

55,434,000

3.7

Amount

$154.696

Billion

$164.586

Billion

6.4

Average refund

$2,894

$2,969

2.6

 

 

 

 

Direct Deposit Refunds:

 

 

 

Number

47,177,000

47,976,000

1.7

Amount

$142.861

Billion

$146.305

Billion

2.4

Average refund

$3,028

$3,050

0.7

 

Page Last Reviewed or Updated: 13-Mar-2014

The Download State Tax Forms Free

Download state tax forms free Index A Adjusted gross income (AGI) Income limits for, Income Limits Age Age 65, Age 65. Download state tax forms free Mandatory retirement age, Payments that are not disability income. Download state tax forms free Assistance (see Tax help) C Citizenship requirement, U. Download state tax forms free S. Download state tax forms free Citizen or Resident Alien Credit figured by IRS, Credit Figured for You Credit figured for you, Credit Figured for You D Disability benefits Nontaxable by law, Step 2. Download state tax forms free Total Certain Nontaxable Pensions and Benefits Disability income, Disability income. Download state tax forms free Disability, permanent and total disability, Qualified Individual, Permanent and total disability. Download state tax forms free E Eligibility for credit, Are You Eligible for the Credit? Employer's accident or health plans or pension plans Disability income from, Disability income. Download state tax forms free Excess adjusted gross income, Step 3. Download state tax forms free Determine Excess Adjusted Gross Income F Figuring the credit yourself, Figuring the Credit Yourself Determine excess AGI, Step 3. Download state tax forms free Determine Excess Adjusted Gross Income Determine initial amount, Step 1. Download state tax forms free Determine Initial Amount Determine the credit, Step 5. Download state tax forms free Determine Your Credit Determine the total of steps 2 and 3, Step 4. Download state tax forms free Determine the Total of Steps 2 and 3 Total certain nontaxable pensions and benefits, Step 2. Download state tax forms free Total Certain Nontaxable Pensions and Benefits Foreign military service Pension, annuity, or disability benefit from, Step 2. Download state tax forms free Total Certain Nontaxable Pensions and Benefits Foreign Service Pension, annuity, or disability benefit from, Step 2. Download state tax forms free Total Certain Nontaxable Pensions and Benefits Form RRB-1099 Payments by Railroad Retirement Board, Step 2. Download state tax forms free Total Certain Nontaxable Pensions and Benefits Form SSA-1099 Social security benefit statement, Step 2. Download state tax forms free Total Certain Nontaxable Pensions and Benefits Free tax services, Free help with your tax return. Download state tax forms free H Head of household, Head of household. Download state tax forms free Help (see Tax help) I Income limits, Income Limits Initial amounts for persons under age 65, Initial amounts for persons under age 65. Download state tax forms free J Joint returns, Married Persons L Limit on credit, Limit on credit. Download state tax forms free Lump-sum payments Accrued annual leave, Payments that are not disability income. Download state tax forms free Death benefits paid to surviving spouse or child, Step 2. Download state tax forms free Total Certain Nontaxable Pensions and Benefits M Mandatory retirement age, Payments that are not disability income. Download state tax forms free Married taxpayers, Married Persons Mentally incompetent persons Sheltered employment for, Sheltered employment. Download state tax forms free Missing children Photographs of, Reminders N National Oceanic and Atmospheric Administration Pension, annuity, or disability benefit from, Step 2. Download state tax forms free Total Certain Nontaxable Pensions and Benefits Nonresident aliens, Exceptions. Download state tax forms free Nontaxable payments, Step 2. Download state tax forms free Total Certain Nontaxable Pensions and Benefits O Out of work, Substantial gainful activity. Download state tax forms free P Pension or annuity payments Nontaxable by law, Step 2. Download state tax forms free Total Certain Nontaxable Pensions and Benefits Permanent and total disability, Qualified Individual, Permanent and total disability. Download state tax forms free Physician certification, Permanent and total disability. Download state tax forms free , Physician's statement. Download state tax forms free Public Health Service Pension, annuity, or disability benefit from, Step 2. Download state tax forms free Total Certain Nontaxable Pensions and Benefits Publications (see Tax help) Q Qualified individual, Qualified Individual Age 65 or older, Qualified Individual Under age 65 and retired on permanent and total disability, Qualified Individual, Under Age 65 R Residence requirement, U. Download state tax forms free S. Download state tax forms free Citizen or Resident Alien S Schedule R, Credit Figured for You, Figuring the Credit Yourself, , Examples Sheltered employment, Sheltered employment. Download state tax forms free Social security payments, Step 2. Download state tax forms free Total Certain Nontaxable Pensions and Benefits Substantial gainful activity, Substantial gainful activity. Download state tax forms free T Tables and figures Figure A, Qualified individual determination, Substantial gainful activity. Download state tax forms free Table 1, Income limits, Substantial gainful activity. Download state tax forms free , Table 1. Download state tax forms free Income Limits Table 2, Initial amounts, Table 2. Download state tax forms free Initial Amounts Tax help, How To Get Tax Help TTY/TDD information, How To Get Tax Help U U. Download state tax forms free S. Download state tax forms free citizens and resident aliens, U. Download state tax forms free S. Download state tax forms free Citizen or Resident Alien V VA Form 21-0172 Certification of permanent and total disability, Veterans. Download state tax forms free Veterans Certification by VA of permanent and total disability, Veterans. Download state tax forms free Exclusion of nontaxable pension or annuity payment or disability benefits, Step 2. Download state tax forms free Total Certain Nontaxable Pensions and Benefits Prev  Up     Home   More Online Publications