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File 2005 Tax Return

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File 2005 Tax Return

File 2005 tax return Index A Adopted child, Adopted child. File 2005 tax return Adoption taxpayer identification number (ATIN), Married child. File 2005 tax return Age test (see Qualifying child) Alaska Permanent Fund dividends, Rule 6—Your Investment Income Must Be $3,300 or Less Alimony, Income That Is Not Earned Income Annuities, Income That Is Not Earned Income Armed forces, Nontaxable military pay. File 2005 tax return , Military personnel stationed outside the United States. File 2005 tax return , Temporary absences. File 2005 tax return , Joint Return Test, Military personnel stationed outside the United States. File 2005 tax return , Nontaxable combat pay. File 2005 tax return Assistance (see Tax help) B Basic Allowance for Housing (BAH), Nontaxable military pay. File 2005 tax return Basic Allowance for Subsistence (BAS), Nontaxable military pay. File 2005 tax return C Child Adopted child, Adopted child. File 2005 tax return Birth or death of, Birth or death of child. File 2005 tax return Foster child, Relationship Test, Foster child. File 2005 tax return , Rule 10—You Cannot Be a Qualifying Child of Another Taxpayer, Kidnapped child, Kidnapped child. File 2005 tax return Married child, Married child. File 2005 tax return Child support, Income That Is Not Earned Income Clergy, Clergy. File 2005 tax return Combat zone pay, Nontaxable combat pay. File 2005 tax return Community property, Community property. File 2005 tax return , Community property. File 2005 tax return D Detailed examples, Chapter 6—Detailed Examples Disability benefits, Disability Benefits Disallowance of the EIC, Chapter 5—Disallowance of the EIC Dividend income, Income That Is Not Earned Income Divorced parents, special rule, Special rule for divorced or separated parents (or parents who live apart). File 2005 tax return Domestic partner, Nevada, Washington, and California domestic partners. File 2005 tax return E Earned income, Rule 7—You Must Have Earned Income, Earned Income Earned income credit (EIC), EIC Table EITC Assistant, Is There Help Online? Extended active duty, Extended active duty. File 2005 tax return , Military personnel stationed outside the United States. File 2005 tax return F Figuring EIC yourself, Chapter 4—Figuring and Claiming the EIC, How To Figure the EIC Yourself Filing status: Head of household, Rule 3—Your Filing Status Cannot Be Married Filing Separately Married filing separately, Rule 3—Your Filing Status Cannot Be Married Filing Separately Forms: 1040, Do I Need This Publication?, Adjusted gross income (AGI). File 2005 tax return , No SSN. File 2005 tax return , Form 1040. File 2005 tax return 1040A, Adjusted gross income (AGI). File 2005 tax return , No SSN. File 2005 tax return , Form 1040A. File 2005 tax return 1040EZ, Adjusted gross income (AGI). File 2005 tax return , No SSN. File 2005 tax return , Form 1040EZ. File 2005 tax return 1040X, Rule 2—You Must Have a Valid Social Security Number (SSN), Filing deadline approaching and still no SSN. File 2005 tax return 2555, Rule 5—You Cannot File Form 2555 or Form 2555-EZ 2555–EZ, Rule 5—You Cannot File Form 2555 or Form 2555-EZ 4029, Minister's housing. File 2005 tax return , Approved Form 4361 or Form 4029, Form 4029. File 2005 tax return 4361, Minister's housing. File 2005 tax return , Approved Form 4361 or Form 4029, Form 4361. File 2005 tax return 4797, Do I Need This Publication? 4868, Filing deadline approaching and still no SSN. File 2005 tax return 8814, Do I Need This Publication? 8862, Chapter 5—Disallowance of the EIC, Form 8862 Foster care payments, Income That Is Not Earned Income Foster child, Relationship Test, Foster child. File 2005 tax return , Rule 10—You Cannot Be a Qualifying Child of Another Taxpayer, Fraud, Exception 2. File 2005 tax return , Are You Prohibited From Claiming the EIC for a Period of Years? Free tax services, Free help with your tax return. File 2005 tax return H Head of household, Community property. File 2005 tax return , Spouse did not live with you. File 2005 tax return , Community property. File 2005 tax return , Rule 9—Your Qualifying Child Cannot Be Used by More Than One Person To Claim the EIC, Applying Rule 9 to divorced or separated parents (or parents who live apart). File 2005 tax return Help (see Tax help) Home Homeless shelter, Rule 14—You Must Have Lived in the United States More Than Half of the Year Military, Rule 14—You Must Have Lived in the United States More Than Half of the Year United States, Rule 14—You Must Have Lived in the United States More Than Half of the Year Homeless, Homeless shelter. File 2005 tax return , Homeless shelter. File 2005 tax return I Income that is not earned income, Income That Is Not Earned Income Individual taxpayer identification number (ITIN), Other taxpayer identification number. File 2005 tax return , Married child. File 2005 tax return Inmate, Earnings while an inmate. File 2005 tax return , Figuring earned income. File 2005 tax return Interest, Income That Is Not Earned Income Investment income, Rule 6—Your Investment Income Must Be $3,300 or Less IRS can figure EIC for you, IRS Will Figure the EIC for You J Joint return test (see Qualifying child) K Kidnapped child, Kidnapped child. File 2005 tax return M Married child, Married child. File 2005 tax return Married filing a joint return, Rule 4—You Must Be a U. File 2005 tax return S. File 2005 tax return Citizen or Resident Alien All Year Married filing separately, Spouse did not live with you. File 2005 tax return Military Combat pay, Nontaxable military pay. File 2005 tax return Nontaxable pay, Nontaxable military pay. File 2005 tax return Outside U. File 2005 tax return S. File 2005 tax return , Military personnel stationed outside the United States. File 2005 tax return Minister, Net earnings from self-employment. File 2005 tax return , Minister's housing. File 2005 tax return , Church employees. File 2005 tax return N Net earnings, self-employment, Net earnings from self-employment. File 2005 tax return Nonresident alien, Rule 4—You Must Be a U. File 2005 tax return S. File 2005 tax return Citizen or Resident Alien All Year, Step 1. File 2005 tax return O Online help EITC Assistant, Is There Help Online? P Parents, divorced or separated, Married child. File 2005 tax return , Examples. File 2005 tax return , Special rule for divorced or separated parents (or parents who live apart). File 2005 tax return Passive activity, Worksheet 1. File 2005 tax return Investment Income If You Are Filing Form 1040 Pensions, Income That Is Not Earned Income Permanently and totally disabled, Permanently and totally disabled. File 2005 tax return Prisoner, Figuring earned income. File 2005 tax return Publications (see Tax help) Q Qualifying child, Can I Claim the EIC?, Do I Have To Have A Child To Qualify For The EIC?, Chapter 2—Rules If You Have a Qualifying Child Age test, Rule 8—Your Child Must Meet the Relationship, Age, Residency, and Joint Return Tests, Age Test Home, Residency Test Joint return test, Rule 8—Your Child Must Meet the Relationship, Age, Residency, and Joint Return Tests Permanently and totally disabled, Permanently and totally disabled. File 2005 tax return Relationship test, Rule 8—Your Child Must Meet the Relationship, Age, Residency, and Joint Return Tests Residency test, Residency Test United States, Residency Test R Railroad retirement benefits, Income That Is Not Earned Income Registered domestic partner, Nevada, Washington, and California domestic partners. File 2005 tax return Relationship test (see Qualifying child) Reminders, Reminders Residency test (see Qualifying child) S Salaries, wages, and tips, Earned Income, Wages, salaries, and tips. File 2005 tax return , Earned Income Schedules: C, EIC Worksheet A. File 2005 tax return , EIC Worksheet B. File 2005 tax return C-EZ, EIC Worksheet A. File 2005 tax return , EIC Worksheet B. File 2005 tax return EIC, Chapter 2—Rules If You Have a Qualifying Child, Kidnapped child. File 2005 tax return , Figuring earned income. File 2005 tax return , Nontaxable combat pay. File 2005 tax return , How To Figure the EIC Yourself, When to use the optional methods of figuring net earnings. File 2005 tax return , Schedule EIC SE, Figuring earned income. File 2005 tax return , Clergy. File 2005 tax return , Church employees. File 2005 tax return , EIC Worksheet A. File 2005 tax return , EIC Worksheet B. File 2005 tax return , Net earnings from self-employment $400 or more. File 2005 tax return , When to use the optional methods of figuring net earnings. File 2005 tax return , When both spouses have self-employment income. File 2005 tax return School, School defined. File 2005 tax return Self-employed persons, Rule 7—You Must Have Earned Income, Figuring earned income. File 2005 tax return , EIC Worksheet B. File 2005 tax return Self-employment income, Earned Income Self-employment tax, Net earnings from self-employment $400 or more. File 2005 tax return Separated parents, special rule, Married child. File 2005 tax return Social security benefits, Income That Is Not Earned Income Social security number (SSN), Rule 2—You Must Have a Valid Social Security Number (SSN), Valid for work only with INS authorization or DHS authorization. File 2005 tax return , No SSN. File 2005 tax return , Getting an SSN. File 2005 tax return , Married child. File 2005 tax return , Exception for math or clerical errors. File 2005 tax return Statutory employee, Statutory employee. File 2005 tax return , Figuring earned income. File 2005 tax return , EIC Worksheet A. File 2005 tax return , Statutory employees. File 2005 tax return Strike benefits, Strike benefits. File 2005 tax return Student, Student defined. File 2005 tax return T Tax help, How To Get Tax Help Taxpayer identification number Adoption identification number (ATIN), Married child. File 2005 tax return Individual taxpayer identification number (ITIN), Other taxpayer identification number. File 2005 tax return Social security number (SSN), Other taxpayer identification number. File 2005 tax return Tiebreaker rules, Tiebreaker rules. File 2005 tax return Tips, wages, and salaries, Earned Income, Wages, salaries, and tips. File 2005 tax return , Earned Income TTY/TDD information, How To Get Tax Help U Unemployment compensation, Income That Is Not Earned Income United States, United States. File 2005 tax return V Veterans' benefits, Income That Is Not Earned Income W Wages, salaries, and tips, Earned Income, Wages, salaries, and tips. File 2005 tax return , Earned Income Welfare benefits, Income That Is Not Earned Income Workers' compensation benefits, Income That Is Not Earned Income Workfare payments, Workfare payments. File 2005 tax return Worksheet 1, Worksheet 1. File 2005 tax return Investment Income If You Are Filing Form 1040 Worksheet 2, Worksheet 2. File 2005 tax return Worksheet for Line 4 of Worksheet 1 Prev  Up     Home   More Online Publications
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Consumer Protection Offices

City, county, regional, and state consumer offices offer a variety of important services. They might mediate complaints, conduct investigations, prosecute offenders of consumer laws, license and regulate professional service providers, provide educational materials and advocate for consumer rights. To save time, call before sending a written complaint. Ask if the office handles the type of complaint you have and if complaint forms are provided.

State Consumer Protection Offices

Office of the Attorney General

Website: Office of the Attorney General

Address: Office of the Attorney General
Consumer Protection Unit
123 State Capitol
200 W. 24th St.
Cheyenne, WY 82002

Phone Number: 307-777-7841

TTY: 307-777-5351

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Banking Authorities

The officials listed in this section regulate and supervise state-chartered banks. Many of them handle or refer problems and complaints about other types of financial institutions as well. Some also answer general questions about banking and consumer credit. If you are dealing with a federally chartered bank, check Federal Agencies.

Department of Audit

Website: Department of Audit

Address: Department of Audit
Division of Banking
122 W. 25th St.
Herschler Building, 3rd Floor, East
Cheyenne, WY 82002

Phone Number: 307-777-7797

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Insurance Regulators

Each state has its own laws and regulations for each type of insurance. The officials listed in this section enforce these laws. Many of these offices can also provide you with information to help you make informed insurance buying decisions.

Department of Insurance

Website: Department of Insurance

Address: Department of Insurance
Consumer Affairs Section
106 E. 6th Ave.
Cheyenne, WY 82002

Phone Number: 307-777-7401

Toll-free: 1-800-438-5768 (WY)

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Securities Administrators

Each state has its own laws and regulations for securities brokers and securities - including stocks, mutual funds, commodities, real estate, etc. The officials and agencies listed in this section enforce these laws and regulations. Many of these offices can also provide information to help you make informed investment decisions.

Office of the Secretary of State

Website: Office of the Secretary of State

Address: Office of the Secretary of State
Compliance Division
State Capitol Building
200 W. 24th St.
Cheyenne, WY 82002-0020

Phone Number: 307-777-7370

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Utility Commissions

State Utility Commissions regulate services and rates for gas, electricity and telephones within your state. In some states, the utility commissions regulate other services such as water, transportation, and the moving of household goods. Many utility commissions handle consumer complaints. Sometimes, if a number of complaints are received about the same utility matter, they will conduct investigations.

Public Service Commission

Website: Public Service Commission

Address: Public Service Commission
2515 Warren Ave., Suite 300
Cheyenne, WY 82002

Phone Number: 307-777-7427

Toll-free: 1-888-570-9905 (WY)

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The File 2005 Tax Return

File 2005 tax return Depreciation Table of Contents Introduction Special Depreciation AllowanceQualified Property Election Not To Claim the Allowance Rules for Returns Filed Before June 1, 2002 Passenger Automobiles New York Liberty Zone BenefitsSpecial Liberty Zone Depreciation Allowance Increased Section 179 Deduction Liberty Zone Leasehold Improvement Property If you depreciate business property that you acquired and placed in service after September 10, 2001, new law contains provisions that may affect your depreciation deduction for that property. File 2005 tax return Publication 946, How To Depreciate Property, contains information on depreciation. File 2005 tax return However, Publication 946 does not contain the new provisions because it was printed before the law was enacted. File 2005 tax return The new provisions are in the Supplement to Publication 946, which is reprinted below. File 2005 tax return Supplement to Publication 946 How To Depreciate Property   Introduction After Publication 946 was printed, the Job Creation and Worker Assistance Act of 2002 was signed into law by the President. File 2005 tax return The new law made several changes in the tax rules explained in the publication. File 2005 tax return Some of the changes apply to property placed in service during 2001. File 2005 tax return This supplemental publication describes those changes and explains what you should do if you are affected by them. File 2005 tax return The situations and examples in Publication 946 do not reflect any of the changes made by the Job Creation and Worker Assistance Act of 2002. File 2005 tax return The new law contains the following provisions. File 2005 tax return 30% depreciation deductions (special depreciation allowance and special New York Liberty Zone (Liberty Zone) depreciation allowance) for the year qualified property is placed in service after September 10, 2001. File 2005 tax return An increased dollar limit on the section 179 deduction for qualified Liberty Zone property purchased after September 10, 2001. File 2005 tax return A shorter recovery period for qualified Liberty Zone leasehold improvement property placed in service after September 10, 2001. File 2005 tax return An increase in the maximum depreciation deduction for 2001 for a qualified passenger automobile placed in service after September 10, 2001. File 2005 tax return If you believe you qualify for an increased deduction under any of these new rules, you must file the revised 2001 Form 4562 (dated March 2002) for 2001 calendar or fiscal years and 2000 fiscal years ending after September 10, 2001. File 2005 tax return If you have already filed a tax return, this supplemental publication explains how to claim these benefits and how to elect not to claim the special depreciation allowance or special Liberty Zone depreciation allowance. File 2005 tax return See Table 2 at the end of the supplement for an overview of the rules that apply if you filed your return before June 1, 2002. File 2005 tax return Special Depreciation Allowance You can take a special depreciation allowance for qualified property you place in service after September 10, 2001. File 2005 tax return The allowance is an additional deduction of 30% of the property's depreciable basis. File 2005 tax return To figure the depreciable basis, you must first multiply the property's cost or other basis by the percentage of business/investment use and then reduce that amount by any section 179 deduction and certain other deductions and credits for the property. File 2005 tax return See What Is the Basis for Depreciation? on page 23 in Publication 946 for more information on figuring depreciable basis. File 2005 tax return The allowance is deductible for both regular tax and alternative minimum tax (AMT) purposes. File 2005 tax return There is no AMT adjustment required for any depreciation figured on the remaining basis of the property. File 2005 tax return In the year you claim the allowance (generally the year you place the property in service), you must reduce the depreciable basis of the property by the allowance before figuring your regular depreciation deduction. File 2005 tax return Example 1. File 2005 tax return On November 1, 2001, you bought and placed in service in your business qualified property that cost $100,000. File 2005 tax return You did not elect to claim a section 179 deduction. File 2005 tax return You can deduct 30% of the cost ($30,000) as a special depreciation allowance for 2001. File 2005 tax return You use the remaining $70,000 of cost to figure your regular depreciation deduction for 2001 and later years. File 2005 tax return Example 2. File 2005 tax return The facts are the same as in Example 1, except that you choose to deduct $24,000 of the property's cost as a section 179 deduction. File 2005 tax return You use the remaining $76,000 of cost to figure your special depreciation allowance of $22,800 ($76,000 × 30%). File 2005 tax return You use the remaining $53,200 of cost to figure your regular depreciation deduction for 2001 and later years. File 2005 tax return Qualified Property To qualify for the special depreciation allowance, your property must meet the following requirements. File 2005 tax return It is new property of one of the following types. File 2005 tax return Property depreciated under the modified accelerated cost recovery system (MACRS) with a recovery period of 20 years or less. File 2005 tax return See Can You Use MACRS To Depreciate Your Property and Which Recovery Period Applies? on pages 7 and 23, respectively, in Publication 946. File 2005 tax return Water utility property. File 2005 tax return See 25-year property on page 22 in Publication 946. File 2005 tax return Computer software that is not a section 197 intangible as described in Computer software on page 5 in Publication 946. File 2005 tax return (The cost of some computer software is treated as part of the cost of hardware and is depreciated under MACRS. File 2005 tax return ) Qualified leasehold improvement property (defined later). File 2005 tax return It meets the following tests (explained later under Tests To Be Met). File 2005 tax return Acquisition date test. File 2005 tax return Placed in service date test. File 2005 tax return Original use test. File 2005 tax return It is not excepted property (explained later under Excepted Property). File 2005 tax return Qualified leasehold improvement property. File 2005 tax return    Generally, this is any improvement to an interior part of a building that is nonresidential real property, provided all of the following requirements are met. File 2005 tax return The improvement is made under or pursuant to a lease by the lessee (or any sublessee) or the lessor of that part of the building. File 2005 tax return That part of the building is to be occupied exclusively by the lessee (or any sublessee) of that part. File 2005 tax return The improvement is placed in service more than 3 years after the date the building was first placed in service. File 2005 tax return   However, a qualified leasehold improvement does not include any improvement for which the expenditure is attributable to any of the following. File 2005 tax return The enlargement of the building. File 2005 tax return Any elevator or escalator. File 2005 tax return Any structural component benefiting a common area. File 2005 tax return The internal structural framework of the building. File 2005 tax return   Generally, a binding commitment to enter into a lease is treated as a lease and the parties to the commitment are treated as the lessor and lessee. File 2005 tax return However, a binding commitment between related persons is not treated as a lease. File 2005 tax return Related persons. File 2005 tax return   For this purpose, the following are related persons. File 2005 tax return Members of an affiliated group. File 2005 tax return The persons listed in items (1) through (9) under Related persons on page 8 of Publication 946 (except that “80% or more” should be substituted for “more than 10%” each place it appears). File 2005 tax return An executor and a beneficiary of the same estate. File 2005 tax return Tests To Be Met To qualify for the special depreciation allowance, the property must meet all of the following tests. File 2005 tax return Acquisition date test. File 2005 tax return    Generally, you must have acquired the property either: After September 10, 2001, and before September 11, 2004, but only if no written binding contract for the acquisition was in effect before September 11, 2001, or Pursuant to a written binding contract entered into after September 10, 2001, and before September 11, 2004. File 2005 tax return   Property you manufacture, construct, or produce for your own use meets this test if you began the manufacture, construction, or production of the property after September 10, 2001, and before September 11, 2004. File 2005 tax return Placed in service date test. File 2005 tax return   Generally, the property must be placed in service for use in your trade or business or for the production of income after September 10, 2001, and before January 1, 2005. File 2005 tax return   If you sold property you placed in service after September 10, 2001, and you leased it back within 3 months after the property was originally placed in service, the property is treated as placed in service no earlier than the date it is used under the leaseback. File 2005 tax return Original use test. File 2005 tax return   The original use of the property must have begun with you after September 10, 2001. File 2005 tax return “Original use” means the first use to which the property is put, whether or not by you. File 2005 tax return Additional capital expenditures you incurred after September 10, 2001, to recondition or rebuild your property meet the original use test. File 2005 tax return Excepted Property The following property does not qualify for the special depreciation allowance. File 2005 tax return Property used by any person before September 11, 2001. File 2005 tax return Property required to be depreciated using ADS. File 2005 tax return This includes listed property used 50% or less in a qualified business use. File 2005 tax return Qualified New York Liberty Zone leasehold improvement property (defined next). File 2005 tax return Qualified New York Liberty Zone leasehold improvement property. File 2005 tax return   This is any qualified leasehold improvement property (as defined earlier) if all of the following requirements are met. File 2005 tax return The improvement is to a building located in the New York Liberty Zone (defined later under New York Liberty Zone Benefits). File 2005 tax return The improvement is placed in service after September 10, 2001, and before January 1, 2007. File 2005 tax return No written binding contract for the improvement was in effect before September 11, 2001. File 2005 tax return Election Not To Claim the Allowance You can elect not to claim the special depreciation allowance for qualified property. File 2005 tax return If you make this election for any property, it applies to all property in the same property class placed in service during the year. File 2005 tax return To make this election, attach a statement to your return indicating you elect not to claim the allowance and the class of property for which you are making the election. File 2005 tax return When to make election. File 2005 tax return   Generally, you must make the election on a timely filed tax return (including extensions) for the year in which you place the property in service. File 2005 tax return   However, if you timely filed your return for the year without making the election, you can still make the election by filing an amended return within 6 months of the due date of the original return (not including extensions). File 2005 tax return Attach the election statement to the amended return. File 2005 tax return At the top of the election statement, write “Filed pursuant to section 301. File 2005 tax return 9100–2. File 2005 tax return ” Revoking an election. File 2005 tax return   Once you elect not to deduct the special depreciation allowance for a class of property, you cannot revoke the election without IRS consent. File 2005 tax return A request to revoke the election is subject to a user fee. File 2005 tax return Rules for Returns Filed Before June 1, 2002 The following rules apply if you placed qualified property in service after September 10, 2001, and filed your return before June 1, 2002. File 2005 tax return The rules apply to returns for the following years. File 2005 tax return 2000 fiscal years that end after September 10, 2001. File 2005 tax return 2001 calendar and fiscal years. File 2005 tax return Claiming the allowance. File 2005 tax return   If you did not claim the allowance on your return and did not make the election not to claim the allowance, you can do either of the following to claim the allowance. File 2005 tax return File an amended return by the due date (not including extensions) of your return for the year following the year the property was placed in service. File 2005 tax return Write “Filed Pursuant to Rev. File 2005 tax return Proc. File 2005 tax return 2002–33” at the top of the amended return. File 2005 tax return File Form 3115, Application for Change in Accounting Method, with your return for the year following the year the property was placed in service. File 2005 tax return Your return must be filed by the due date (including extensions). File 2005 tax return Write “Automatic Change Filed Under Rev. File 2005 tax return Proc. File 2005 tax return 2002–33” on the appropriate line of Form 3115. File 2005 tax return You must also file a copy (with signature) of the completed Form 3115 with the IRS National Office no later than when you file the original with your return. File 2005 tax return For more information about filing Form 3115, including the address to send it to, see Revenue Procedure 2002–9, Revenue Procedure 2002–19, and Revenue Procedure 2002–33. File 2005 tax return Example 1. File 2005 tax return You are an individual and you use the calendar year. File 2005 tax return You placed qualified property in service for your business in December 2001. File 2005 tax return You filed your 2001 income tax return before April 15, 2002. File 2005 tax return You did not claim the special depreciation allowance for the property and did not make the election not to claim the allowance. File 2005 tax return You can claim the special allowance by filing an amended 2001 return by April 15, 2003, with “Filed Pursuant to Rev. File 2005 tax return Proc. File 2005 tax return 2002–33” at the top of the amended return. File 2005 tax return You must file an amended return by April 15, 2003, even if you get an extension of time to file your 2002 tax return. File 2005 tax return Example 2. File 2005 tax return The facts concerning your 2001 return are the same as in Example 1. File 2005 tax return In addition, you got an automatic 4-month extension of time (to August 15, 2003) to file your 2002 return. File 2005 tax return You can claim the special allowance by filing a Form 3115 (with “Filed Pursuant to Rev. File 2005 tax return Proc. File 2005 tax return 2002–33” on the appropriate line) with your 2002 return by August 15, 2003. File 2005 tax return You must also file a copy of this Form 3115 with the IRS National Office no later than when you file your 2002 return. File 2005 tax return Electing not to claim the allowance. File 2005 tax return   Generally, you have elected not to claim the special depreciation allowance for a class of property if you: Filed your return timely (including extensions) for the year you placed qualified property in service and indicated on a statement with the return that you are not claiming the allowance, or Filed your return timely and filed an amended return within 6 months of the due date of the original return (not including extensions) and indicated on a statement with the amended return that you are not claiming the allowance. File 2005 tax return The statement must indicate that you are not deducting the special depreciation allowance and the class of property to which the election applies. File 2005 tax return The statement can be either attached to or written on the return. File 2005 tax return You can, for example, write “not deducting 30%” on Form 4562. File 2005 tax return Deemed election. File 2005 tax return   If you have not followed either of the procedures described above to elect not to claim the allowance, you may still be treated as making the election. File 2005 tax return You will be treated as making the election if you meet both of the following conditions. File 2005 tax return You filed your return for the year you placed the property in service and claimed depreciation, but not the special allowance, for any class of property. File 2005 tax return You do not file an amended return or a Form 3115 within the time prescribed for claiming the special allowance. File 2005 tax return See Claiming the allowance, earlier. File 2005 tax return Passenger Automobiles The limit on your depreciation deduction (including any section 179 deduction) for any passenger automobile that is qualified property (defined earlier) placed in service after September 10, 2001, and for which you claim the special depreciation allowance is increased. File 2005 tax return Generally, the limit is increased from $3,060 to $7,660. File 2005 tax return However, if the automobile is a qualified electric car, the limit is increased from $9,280 to $23,080 ($22,980 if placed in service in 2002). File 2005 tax return Table 1 shows the maximum deduction amounts for 2001. File 2005 tax return Table 1. File 2005 tax return Maximum Deduction for 2001 Qualified Vehicle Placed in Service Before Sept. File 2005 tax return 11 Placed in Service After Sept. File 2005 tax return 10 Passenger automobile $3,060 $7,660 Electric car 9,280 23,080 1 1$22,980 if you place an electric car in service in 2002. File 2005 tax return Election not to claim the allowance. File 2005 tax return   The increased maximum depreciation deduction does not apply if you elected not to claim the special depreciation allowance as explained earlier under Election Not To Claim the Allowance and Rules for Returns Filed Before June 1, 2002. File 2005 tax return New York Liberty Zone Benefits Several benefits are available for property you place in service in the New York Liberty Zone (Liberty Zone). File 2005 tax return They include a special depreciation allowance for the year you place the property in service, an increased section 179 deduction, and the classification of certain leasehold improvement property as 5-year property. File 2005 tax return Area defined. File 2005 tax return   The New York Liberty Zone is the area located on or south of Canal Street, East Broadway (east of its intersection with Canal Street), or Grand Street (east of its intersection with East Broadway) in the Borough of Manhattan in the City of New York, New York. File 2005 tax return Special Liberty Zone Depreciation Allowance You can take a special depreciation allowance for qualified Liberty Zone property you place in service after September 10, 2001. File 2005 tax return The allowance is an additional deduction of 30% of the property's depreciable basis. File 2005 tax return To figure the depreciable basis, you must first multiply the property's cost or other basis by the percentage of business/investment use and then reduce that amount by any section 179 deduction and certain other deductions and credits for the property. File 2005 tax return See What Is the Basis for Depreciation? on page 23 in Publication 946 for more information on figuring depreciable basis. File 2005 tax return The allowance is deductible for both regular tax and alternative minimum tax (AMT) purposes. File 2005 tax return There is no AMT adjustment required for any depreciation figured on the remaining basis of the property. File 2005 tax return In the year you claim the allowance (generally the year you place the property in service), you must reduce the depreciable basis of the property by the allowance before figuring your regular depreciation deduction. File 2005 tax return You cannot claim the special Liberty Zone depreciation allowance for property eligible for the special depreciation allowance explained earlier in Qualified Property under Special Depreciation Allowance. File 2005 tax return Qualified property is eligible for only one special depreciation allowance. File 2005 tax return Example 1. File 2005 tax return On November 1, 2001, you bought and placed in service in your business, which is in the Liberty Zone, qualified Liberty Zone property that cost $200,000. File 2005 tax return You did not elect to claim a section 179 deduction. File 2005 tax return You can deduct 30% of the cost ($60,000) as a special Liberty Zone depreciation allowance for 2001. File 2005 tax return You use the remaining $140,000 of cost to figure your regular depreciation deduction for 2001 and later years. File 2005 tax return Example 2. File 2005 tax return The facts are the same as in Example 1, except that you choose to deduct $59,000 of the property's cost as a section 179 deduction. File 2005 tax return (See Increased Section 179 Deduction, later, for information concerning how this section 179 deduction amount is figured). File 2005 tax return You use the remaining $141,000 of cost to figure your special Liberty Zone depreciation allowance of $42,300 ($141,000 × 30%). File 2005 tax return You use the remaining $98,700 of cost to figure your regular depreciation deduction for 2001 and later years. File 2005 tax return Qualified Liberty Zone Property For a 2001 calendar or fiscal year and a 2000 fiscal year that ends after September 10, 2001, property qualifies for the special Liberty Zone depreciation allowance if it meets the following requirements. File 2005 tax return It is one of the following types of property. File 2005 tax return Used property depreciated under MACRS with a recovery period of 20 years or less. File 2005 tax return See Can You Use MACRS To Depreciate Your Property and Which Recovery Period Applies? on pages 7 and 23, respectively, in Publication 946. File 2005 tax return Used water utility property. File 2005 tax return See 25-year property on page 22 in Publication 946. File 2005 tax return Used computer software that is not a section 197 intangible as described in Computer software on page 5 in Publication 946. File 2005 tax return (The cost of some computer software is treated as part of the cost of hardware and is depreciated under MACRS. File 2005 tax return ) Certain nonresidential real property and residential rental property (defined later). File 2005 tax return It meets the following tests (explained later under Tests to be met). File 2005 tax return Acquisition date test. File 2005 tax return Placed in service date test. File 2005 tax return Substantial use test. File 2005 tax return Original use test. File 2005 tax return It is not excepted property (explained later under Excepted property). File 2005 tax return Nonresidential real property and residential rental property. File 2005 tax return   This property is qualifying property only to the extent it rehabilitates real property damaged, or replaces real property destroyed or condemned, as a result of the terrorist attack of September 11, 2001. File 2005 tax return Property is treated as replacing destroyed or condemned property if, as part of an integrated plan, such property replaces real property included in a continuous area that includes real property destroyed or condemned. File 2005 tax return   For these purposes, real property is considered destroyed (or condemned) only if an entire building or structure was destroyed (or condemned) as a result of the terrorist attack. File 2005 tax return Otherwise, the property is considered damaged real property. File 2005 tax return For example, if certain structural components of a building (such as walls, floors, or plumbing fixtures) are damaged or destroyed as a result of the terrorist attack, but the building is not destroyed (or condemned), then only costs related to replacing the damaged or destroyed structural components qualify for the special Liberty Zone depreciation allowance. File 2005 tax return Tests to be met. File 2005 tax return   To qualify for the special Liberty Zone depreciation allowance, your property must meet all of the following tests. File 2005 tax return Acquisition date test. File 2005 tax return   You must have acquired the property by purchase after September 10, 2001, and there must not have been a binding written contract for the acquisition in effect before September 11, 2001. File 2005 tax return   For information on the acquisition of property by purchase, see Property Acquired by Purchase on page 15 of Publication 946. File 2005 tax return   Property you manufacture, construct, or produce for your own use meets this test if you began the manufacture, construction, or production of the property after September 10, 2001. File 2005 tax return Placed in service date test. File 2005 tax return   Generally, the property must be placed in service for use in your trade or business or for the production of income before January 1, 2007 (January 1, 2010, in the case of qualifying nonresidential real property and residential rental property). File 2005 tax return   If you sold property you placed in service after September 10, 2001, and you leased it back within 3 months after the property was originally placed in service, the property is treated as placed in service no earlier than the date it is used under the leaseback. File 2005 tax return Substantial use test. File 2005 tax return   Substantially all use of the property must be in the Liberty Zone and in the active conduct of your trade or business in the Liberty Zone. File 2005 tax return Original use test. File 2005 tax return   The original use of the property in the Liberty Zone must have begun with you after September 10, 2001. File 2005 tax return   Used property can be qualified Liberty Zone property if it has not previously been used within the Liberty Zone. File 2005 tax return Also, additional capital expenditures you incurred after September 10, 2001, to recondition or rebuild your property meet the original use test if the original use of the property in the Liberty Zone began with you. File 2005 tax return Excepted property. File 2005 tax return   The following property does not qualify for the special Liberty Zone depreciation allowance. File 2005 tax return Property eligible for the special depreciation allowance explained earlier in Qualified Property under Special Depreciation Allowance. File 2005 tax return Property required to be depreciated using ADS. File 2005 tax return This includes listed property used 50% or less in a qualified business use. File 2005 tax return Qualified New York Liberty Zone leasehold improvement property (defined earlier in Excepted Property under Special Depreciation Allowance). File 2005 tax return Example. File 2005 tax return In December 2001, you bought and placed in service in your business in the Liberty Zone the following property. File 2005 tax return New office furniture with a MACRS recovery period of 7 years. File 2005 tax return A used computer with a MACRS recovery period of 5 years. File 2005 tax return The computer had not previously been used within the Liberty Zone. File 2005 tax return Because the office furniture is new property, it qualifies for the special depreciation allowance, but not the special Liberty Zone depreciation allowance. File 2005 tax return Because the computer is used property that had not previously been used in the Liberty Zone, it qualifies for the special Liberty Zone depreciation allowance, but not the special depreciation allowance. File 2005 tax return Election Not To Claim the Liberty Zone Allowance You can elect not to claim the special Liberty Zone depreciation allowance for qualified property. File 2005 tax return If you make this election for any property, it applies to all property in the same property class placed in service during the year. File 2005 tax return To make this election, attach a statement to your return indicating you elect not to claim the allowance and the class of property for which you are making the election. File 2005 tax return When to make the election. File 2005 tax return   Generally, you must make the election on a timely filed tax return (including extensions) for the year in which you place the property in service. File 2005 tax return   However, if you timely filed your return for the year without making the election, you can still make the election by filing an amended return within 6 months of the due date of the original return (not including extensions). File 2005 tax return Attach the election statement to the amended return. File 2005 tax return At the top of the election statement, write “Filed pursuant to section 301. File 2005 tax return 9100–2. File 2005 tax return ” Revoking an election. File 2005 tax return   Once you elect not to deduct the special Liberty Zone depreciation allowance for a class of property, you cannot revoke the election without IRS consent. File 2005 tax return A request to revoke the election is subject to a user fee. File 2005 tax return Returns filed before June 1, 2002. File 2005 tax return   The rules that apply to the special depreciation allowance discussed earlier in Rules for Returns Filed Before June 1, 2002 under Special Depreciation Allowance also apply to the special Liberty Zone depreciation allowance. File 2005 tax return Increased Section 179 Deduction Under section 179 of the Internal Revenue Code, you can choose to recover all or part of the cost of certain qualifying property, up to a limit, by deducting it in the year you place the property in service. File 2005 tax return For tax years beginning in 2000, that limit was $20,000. File 2005 tax return For tax years beginning in 2001 and 2002, that limit is generally $24,000. File 2005 tax return If the cost of qualifying section 179 property placed in service in a year is over $200,000, you must reduce the dollar limit (but not below zero) by the amount of the cost over $200,000. File 2005 tax return Increased Dollar Limit The dollar limit on the section 179 deduction is increased for certain property placed in service in the Liberty Zone. File 2005 tax return The increase is the smaller of the following amounts. File 2005 tax return $35,000. File 2005 tax return The cost of section 179 property that is qualified Liberty Zone property placed in service during the year. File 2005 tax return If you use the revised 2001 Form 4562 (dated March 2002) for a tax year beginning in 2000, you must reduce the section 179 dollar limit to $20,000 before adding the additional amount for qualified property. File 2005 tax return Qualified property. File 2005 tax return   To qualify for the increased section 179 deduction, your property must be section 179 property that is either: Qualified Liberty Zone property, or Property that would be qualified Liberty Zone property except that it is eligible for the special depreciation allowance. File 2005 tax return Qualified Liberty Zone property is explained earlier in Qualified Liberty Zone Property under Special Liberty Zone Depreciation Allowance. File 2005 tax return Property eligible for the special depreciation allowance is explained earlier in Qualified Property under Special Depreciation Allowance. File 2005 tax return For information on the requirements that must be met for property to qualify for the section 179 deduction, see What Property Qualifies? on page 14 of Publication 946. File 2005 tax return Example 1. File 2005 tax return In 2002, you place in service in your business, which is in the Liberty Zone, qualified property (defined earlier) costing $25,000. File 2005 tax return Because this cost is less than $35,000, the dollar limit on the section 179 deduction is increased by $25,000 to $49,000 ($24,000 + $25,000). File 2005 tax return Example 2. File 2005 tax return In 2002, you place in service in your business, which is in the Liberty Zone, qualified property (defined earlier) costing $75,000. File 2005 tax return Because $35,000 is less than the cost of the property you place in service, the dollar limit on the section 179 deduction you can claim is increased by $35,000 to $59,000 ($24,000 + $35,000). File 2005 tax return Reduced Dollar Limit Generally, you must reduce the dollar limit for a year by the cost of qualifying section 179 property placed in service in the year that is more than $200,000. File 2005 tax return However, if the cost of your Liberty Zone property exceeds $200,000, you take into account only 50% (instead of 100%) of the cost of qualified property placed in service in a year. File 2005 tax return Example. File 2005 tax return In 2002, you place in service in your business, which is in the Liberty Zone, qualified property costing $460,000. File 2005 tax return Your increased dollar limit is $59,000 ($35,000 + $24,000). File 2005 tax return Because 50% of the cost of the property you place in service ($230,000) is $30,000 more than $200,000, you must reduce your $59,000 dollar limit to $29,000 ($59,000 - $30,000). File 2005 tax return Recapture Rules Rules similar to those explained on page 20 of Publication 946 under When Must You Recapture the Deduction? apply with respect to any qualified property you stop using in the Liberty Zone. File 2005 tax return Returns Filed Before June 1, 2002 If you filed a return before June 1, 2002, and did not deduct the increased section 179 amount for qualified property placed in service after September 10, 2001, you can deduct the increased amount by filing an amended return by the due date (not including extensions) of the return for the year after the year the property was placed in service. File 2005 tax return This rule applies to returns for the following years. File 2005 tax return 2000 fiscal years that end after September 10, 2001. File 2005 tax return 2001 calendar and fiscal years. File 2005 tax return On the amended return, write “Filed Pursuant to Rev. File 2005 tax return Proc. File 2005 tax return 2002–33. File 2005 tax return ” Liberty Zone Leasehold Improvement Property Qualified Liberty Zone leasehold improvement property (described earlier in Qualified Property under Special Depreciation Allowance) is 5-year property. File 2005 tax return This means that it is depreciated over a recovery period of 5 years. File 2005 tax return For information about recovery periods, see Which Recovery Period Applies? on page 23 of Publication 946. File 2005 tax return The straight-line method must be used with respect to qualified Liberty Zone leasehold improvement property. File 2005 tax return Under ADS, the recovery period for qualified Liberty Zone leasehold improvement property is 9 years. File 2005 tax return Returns Filed Before June 1, 2002 If you filed either of the following returns before June 1, 2002, and did not depreciate qualified Liberty Zone leasehold improvement property placed in service during the tax year as 5-year property using the straight line method, you should file an amended return before you file your return for the year after the year the property was placed in service. File 2005 tax return Your 2000 fiscal year return (for a 2000 fiscal year that ends after September 10, 2001). File 2005 tax return Your 2001 calendar or fiscal year return. File 2005 tax return On the amended return, write “Filed Pursuant to Rev. File 2005 tax return Proc. File 2005 tax return 2002–33. File 2005 tax return ” Table 2. File 2005 tax return Rules for Returns Filed Before June 1, 2002 Note:This chart highlights the rules for returns affected by the Job Creation and Worker Assistance Act of 2002 that were filed before June 1, 2002, without accounting for any of the new benefits under the law. File 2005 tax return See the text for definitions and examples. File 2005 tax return Do not rely on this chart alone. File 2005 tax return IF you want to. File 2005 tax return . File 2005 tax return . File 2005 tax return THEN you. File 2005 tax return . File 2005 tax return . File 2005 tax return BY. File 2005 tax return . File 2005 tax return . File 2005 tax return claim the special depreciation allowance or special Liberty Zone depreciation allowance • must file an amended return • the due date (not including extensions) of your return for the year after the year the property was placed in service, or • must file Form 3115, Application for Change in Accounting Method, with your return for the year after the year the property was placed in service • the due date (including extensions) of your return for the year after the year the property was placed in service, and • must file a copy of your completed Form 3115 with the IRS National Office • the date you file the original Form 3115 with your return for the year after the year the property was placed in service. File 2005 tax return elect not to claim the special depreciation allowance or the special Liberty Zone depreciation allowance 1 • must have filed your return timely for the year the property was placed in service, and   • must file an amended return stating you are not claiming the allowance • the date that is 6 months after the due date of the original return (not including extensions). File 2005 tax return deduct the increased section 179 amount • must file an amended return • the due date (not including extensions) of your return for the year after the year the property was placed in service. File 2005 tax return use a 5-year recovery period for depreciating qualified Liberty Zone leasehold improvement property • should file an amended return • the date you file your return for the year after the year the property was placed in service. File 2005 tax return 1See also Deemed election under Rules for Returns Filed Before June 1, 2002, earlier. 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