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File 2006 Tax Return

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File 2006 Tax Return

File 2006 tax return 2. File 2006 tax return   Source of Income Table of Contents Introduction Topics - This chapter discusses: Resident Aliens Nonresident AliensInterest Income Dividends Guarantee of Indebtedness Personal Services Transportation Income Scholarships, Grants, Prizes, and Awards Pensions and Annuities Rents or Royalties Real Property Personal Property Community Income Introduction After you have determined your alien status, you must determine the source of your income. File 2006 tax return This chapter will help you determine the source of different types of income you may receive during the tax year. File 2006 tax return This chapter also discusses special rules for married individuals who are domiciled in a country with community property laws. File 2006 tax return Topics - This chapter discusses: Income source rules, and Community income. File 2006 tax return Resident Aliens A resident alien's income is generally subject to tax in the same manner as a U. File 2006 tax return S. File 2006 tax return citizen. File 2006 tax return If you are a resident alien, you must report all interest, dividends, wages, or other compensation for services, income from rental property or royalties, and other types of income on your U. File 2006 tax return S. File 2006 tax return tax return. File 2006 tax return You must report these amounts from sources within and outside the United States. File 2006 tax return Nonresident Aliens A nonresident alien usually is subject to U. File 2006 tax return S. File 2006 tax return income tax only on U. File 2006 tax return S. File 2006 tax return source income. File 2006 tax return Under limited circumstances, certain foreign source income is subject to U. File 2006 tax return S. File 2006 tax return tax. File 2006 tax return See Foreign Income in chapter 4. File 2006 tax return The general rules for determining U. File 2006 tax return S. File 2006 tax return source income that apply to most nonresident aliens are shown in Table 2-1. File 2006 tax return The following discussions cover the general rules as well as the exceptions to these rules. File 2006 tax return Not all items of U. File 2006 tax return S. File 2006 tax return source income are taxable. File 2006 tax return See chapter 3. File 2006 tax return Interest Income Generally, U. File 2006 tax return S. File 2006 tax return source interest income includes the following items. File 2006 tax return Interest on bonds, notes, or other interest-bearing obligations of U. File 2006 tax return S. File 2006 tax return residents or domestic corporations. File 2006 tax return Interest paid by a domestic or foreign partnership or foreign corporation engaged in a U. File 2006 tax return S. File 2006 tax return trade or business at any time during the tax year. File 2006 tax return Original issue discount. File 2006 tax return Interest from a state, the District of Columbia, or the U. File 2006 tax return S. File 2006 tax return Government. File 2006 tax return The place or manner of payment is immaterial in determining the source of the income. File 2006 tax return A substitute interest payment made to the transferor of a security in a securities lending transaction or a sale-repurchase transaction is sourced in the same manner as the interest on the transferred security. File 2006 tax return Exceptions. File 2006 tax return   U. File 2006 tax return S. File 2006 tax return source interest income does not include the following items. File 2006 tax return Interest paid by a resident alien or a domestic corporation on obligations issued before August 10, 2010, if for the 3-year period ending with the close of the payer's tax year preceding the interest payment, at least 80% of the payer's total gross income: Is from sources outside the United States, and Is attributable to the active conduct of a trade or business by the individual or corporation in a foreign country or a U. File 2006 tax return S. File 2006 tax return possession. File 2006 tax return However, the interest will be considered U. File 2006 tax return S. File 2006 tax return source interest income if either of the following apply. File 2006 tax return The recipient of the interest is related to the resident alien or domestic corporation. File 2006 tax return See section 954(d)(3) for the definition of related person. File 2006 tax return The terms of the obligation are significantly modified after August 9, 2010. File 2006 tax return Any extension of the term of the obligation is considered a significant modification. File 2006 tax return Interest paid by a foreign branch of a domestic corporation or a domestic partnership on deposits or withdrawable accounts with mutual savings banks, cooperative banks, credit unions, domestic building and loan associations, and other savings institutions chartered and supervised as savings and loan or similar associations under federal or state law if the interest paid or credited can be deducted by the association. File 2006 tax return Interest on deposits with a foreign branch of a domestic corporation or domestic partnership, but only if the branch is in the commercial banking business. File 2006 tax return Dividends In most cases, dividend income received from domestic corporations is U. File 2006 tax return S. File 2006 tax return source income. File 2006 tax return Dividend income from foreign corporations is usually foreign source income. File 2006 tax return Exceptions to both of these rules are discussed below. File 2006 tax return A substitute dividend payment made to the transferor of a security in a securities lending transaction or a sale-repurchase transaction is sourced in the same manner as a distribution on the transferred security. File 2006 tax return Dividend equivalent payments. File 2006 tax return   U. File 2006 tax return S. File 2006 tax return source dividends also include all dividend equivalent payments. File 2006 tax return Dividend equivalent payments include substitute dividends, payments made pursuant to a specified notional principal contract, and all similar payments that, directly or indirectly, are contingent on or determined by reference to, the payment of a dividend from U. File 2006 tax return S. File 2006 tax return sources. File 2006 tax return    The Internal Revenue Service has issued final regulations that would affect the treatment of dividend equivalent payments and specified notional principal contracts. File 2006 tax return You can view this regulation at www. File 2006 tax return irs. File 2006 tax return gov/irb/2013-52_IRB/ar08. File 2006 tax return html. File 2006 tax return First exception. File 2006 tax return   Dividends received from a domestic corporation are not U. File 2006 tax return S. File 2006 tax return source income if the corporation elects to take the American Samoa economic development credit. File 2006 tax return Second exception. File 2006 tax return   Part of the dividends received from a foreign corporation is U. File 2006 tax return S. File 2006 tax return source income if 25% or more of its total gross income for the 3-year period ending with the close of its tax year preceding the declaration of dividends was effectively connected with a trade or business in the United States. File 2006 tax return If the corporation was formed less than 3 years before the declaration, use its total gross income from the time it was formed. File 2006 tax return Determine the part that is U. File 2006 tax return S. File 2006 tax return source income by multiplying the dividend by the following fraction. File 2006 tax return   Foreign corporation's gross income connected with a U. File 2006 tax return S. File 2006 tax return trade or business for the 3-year period     Foreign corporation's gross income from all sources for that period   Guarantee of Indebtedness Certain amounts received directly or indirectly, for the provision of a guarantee of indebtedness issued after September 27, 2010, are U. File 2006 tax return S. File 2006 tax return source income. File 2006 tax return They must be paid by a noncorporate resident or U. File 2006 tax return S. File 2006 tax return corporation or by any foreign person if the amounts are effectively connected with the conduct of a U. File 2006 tax return S. File 2006 tax return trade or business. File 2006 tax return For more information, see Internal Revenue Code sections 861(a)(9) and 862(a)(9). File 2006 tax return Personal Services All wages and any other compensation for services performed in the United States are considered to be from sources in the United States. File 2006 tax return The only exceptions to this rule are discussed in chapter 3 under Employees of foreign persons, organizations, or offices, and under Crew members. File 2006 tax return If you are an employee and receive compensation for labor or personal services performed both inside and outside the United States, special rules apply in determining the source of the compensation. File 2006 tax return Compensation (other than certain fringe benefits) is sourced on a time basis. File 2006 tax return Certain fringe benefits (such as housing and education) are sourced on a geographical basis. File 2006 tax return Or, you may be permitted to use an alternative basis to determine the source of compensation. File 2006 tax return See Alternative Basis , later. File 2006 tax return Multi-level marketing. File 2006 tax return   Certain companies sell products through a multi-level marketing arrangement, such that an upper-tier distributor, who has sponsored a lower-tier distributor, is entitled to a payment from the company based on certain activities of that lower-tier distributor. File 2006 tax return Generally, depending on the facts, payments from such multi-level marketing companies to independent (non-employee) distributors (upper-tier distributors) that are based on the sales or purchases of persons whom they have sponsored (lower-tier distributors) constitute income for the performance of personal services in recruiting, training, and supporting the lower-tier distributors. File 2006 tax return The source of such income is generally based on where the services of the upper-tier distributor are performed, and may, depending on the facts, be considered multi-year compensation, with the source of income determined over the period to which such compensation is attributable. File 2006 tax return Self-employed individuals. File 2006 tax return   If you are self-employed, you determine the source of compensation for labor or personal services from self-employment on the basis that most correctly reflects the proper source of that income under the facts and circumstances of your particular case. File 2006 tax return In many cases, the facts and circumstances will call for an apportionment on a time basis as explained next. File 2006 tax return Time Basis Use a time basis to figure your U. File 2006 tax return S. File 2006 tax return source compensation (other than the fringe benefits discussed later). File 2006 tax return Do this by multiplying your total compensation (other than the fringe benefits discussed later) by the following fraction:   Number of days you performed services in the United States during the year     Total number of days you performed services during the year   You can use a unit of time less than a day in the above fraction, if appropriate. File 2006 tax return The time period for which the compensation is made does not have to be a year. File 2006 tax return Instead, you can use another distinct, separate, and continuous time period if you can establish to the satisfaction of the IRS that this other period is more appropriate. File 2006 tax return Example 1. File 2006 tax return Christina Brooks, a resident of the Netherlands, worked 240 days for a U. File 2006 tax return S. File 2006 tax return company during the tax year. File 2006 tax return She received $80,000 in compensation. File 2006 tax return None of it was for fringe benefits. File 2006 tax return Christina performed services in the United States for 60 days and performed services in the Netherlands for 180 days. File 2006 tax return Using the time basis for determining the source of compensation, $20,000 ($80,000 × 60/240) is her U. File 2006 tax return S. File 2006 tax return source income. File 2006 tax return Example 2. File 2006 tax return Rob Waters, a resident of South Africa, is employed by a corporation. File 2006 tax return His annual salary is $100,000. File 2006 tax return None of it is for fringe benefits. File 2006 tax return During the first quarter of the year he worked entirely within the United States. File 2006 tax return On April 1, Rob was transferred to Singapore for the remainder of the year. File 2006 tax return Rob is able to establish that the first quarter of the year and the last 3 quarters of the year are two separate, distinct, and continuous periods of time. File 2006 tax return Accordingly, $25,000 of Rob's annual salary is attributable to the first quarter of the year (. File 2006 tax return 25 × $100,000). File 2006 tax return All of it is U. File 2006 tax return S. File 2006 tax return source income because he worked entirely within the United States during that quarter. File 2006 tax return The remaining $75,000 is attributable to the last three quarters of the year. File 2006 tax return During those quarters, he worked 150 days in Singapore and 30 days in the United States. File 2006 tax return His periodic performance of services in the United States did not result in distinct, separate, and continuous periods of time. File 2006 tax return Of this $75,000, $12,500 ($75,000 × 30/180) is U. File 2006 tax return S. File 2006 tax return source income. File 2006 tax return Multi-year compensation. File 2006 tax return   The source of multi-year compensation is generally determined on a time basis over the period to which the compensation is attributable. File 2006 tax return Multi-year compensation is compensation that is included in your income in one tax year but that is attributable to a period that includes two or more tax years. File 2006 tax return   You determine the period to which the compensation is attributable based on the facts and circumstances of your case. File 2006 tax return For example, an amount of compensation that specifically relates to a period of time that includes several calendar years is attributable to the entire multi-year period. File 2006 tax return   The amount of compensation treated as from U. File 2006 tax return S. File 2006 tax return sources is figured by multiplying the total multi-year compensation by a fraction. File 2006 tax return The numerator of the fraction is the number of days (or unit of time less than a day, if appropriate) that you performed labor or personal services in the United States in connection with the project. File 2006 tax return The denominator of the fraction is the total number of days (or unit of time less than a day, if appropriate) that you performed labor or personal services in connection with the project. File 2006 tax return Geographical Basis Compensation you receive as an employee in the form of the following fringe benefits is sourced on a geographical basis. File 2006 tax return Housing. File 2006 tax return Education. File 2006 tax return Local transportation. File 2006 tax return Tax reimbursement. File 2006 tax return Hazardous or hardship duty pay as defined in Regulations section 1. File 2006 tax return 861-4(b)(2)(ii)(D)(5). File 2006 tax return Moving expense reimbursement. File 2006 tax return The amount of fringe benefits must be reasonable and you must substantiate them by adequate records or by sufficient evidence. File 2006 tax return Principal place of work. File 2006 tax return   The above fringe benefits, except for tax reimbursement and hazardous or hardship duty pay, are sourced based on your principal place of work. File 2006 tax return Your principal place of work is usually the place where you spend most of your working time. File 2006 tax return This could be your office, plant, store, shop, or other location. File 2006 tax return If there is no one place where you spend most of your working time, your main job location is the place where your work is centered, such as where you report for work or are otherwise required to “base” your work. File 2006 tax return   If you have more than one job at any time, your main job location depends on the facts in each case. File 2006 tax return The more important factors to be considered are: The total time you spend at each place, The amount of work you do at each place, and How much money you earn at each place. File 2006 tax return Housing. File 2006 tax return   The source of a housing fringe benefit is determined based on the location of your principal place of work. File 2006 tax return A housing fringe benefit includes payments to you or on your behalf (and your family's if your family resides with you) only for the following. File 2006 tax return Rent. File 2006 tax return Utilities (except telephone charges). File 2006 tax return Real and personal property insurance. File 2006 tax return Occupancy taxes not deductible under section 164 or 216(a). File 2006 tax return Nonrefundable fees for securing a leasehold. File 2006 tax return Rental of furniture and accessories. File 2006 tax return Household repairs. File 2006 tax return Residential parking. File 2006 tax return Fair rental value of housing provided in kind by your employer. File 2006 tax return   A housing fringe benefit does not include: Deductible interest and taxes (including deductible interest and taxes of a tenant-stockholder in a cooperative housing corporation), The cost of buying property, including principal payments on a mortgage, The cost of domestic labor (maids, gardeners, etc. File 2006 tax return ), Pay television subscriptions, Improvements and other expenses that increase the value or appreciably prolong the life of property, Purchased furniture or accessories, Depreciation or amortization of property or improvements, The value of meals or lodging that you exclude from gross income, or The value of meals or lodging that you deduct as moving expenses. File 2006 tax return Education. File 2006 tax return   The source of an education fringe benefit for the education expenses of your dependents is determined based on the location of your principal place of work. File 2006 tax return An education fringe benefit includes payments only for the following expenses for education at an elementary or secondary school. File 2006 tax return Tuition, fees, academic tutoring, special needs services for a special needs student, books, supplies, and other equipment. File 2006 tax return Room and board and uniforms that are required or provided by the school in connection with enrollment or attendance. File 2006 tax return Local transportation. File 2006 tax return   The source of a local transportation fringe benefit is determined based on the location of your principal place of work. File 2006 tax return Your local transportation fringe benefit is the amount that you receive as compensation for local transportation for you or your spouse or dependents at the location of your principal place of work. File 2006 tax return The amount treated as a local transportation fringe benefit is limited to actual expenses incurred for local transportation and the fair rental value of any employer-provided vehicle used predominantly by you, your spouse, or your dependents for local transportation. File 2006 tax return Actual expenses do not include the cost (including interest) of any vehicle purchased by you or on your behalf. File 2006 tax return Tax reimbursement. File 2006 tax return   The source of a tax reimbursement fringe benefit is determined based on the location of the jurisdiction that imposed the tax for which you are reimbursed. File 2006 tax return Moving expense reimbursement. File 2006 tax return   The source of a moving expense reimbursement is generally based on the location of your new principal place of work. File 2006 tax return However, the source is determined based on the location of your former principal place of work if you provide sufficient evidence that such determination of source is more appropriate under the facts and circumstances of your case. File 2006 tax return Sufficient evidence generally requires an agreement between you and your employer, or a written statement of company policy, which is reduced to writing before the move and which is entered into or established to induce you or other employees to move to another country. File 2006 tax return The written statement or agreement must state that your employer will reimburse you for moving expenses that you incur to return to your former principal place of work regardless of whether you continue to work for your employer after returning to that location. File 2006 tax return It may contain certain conditions upon which the right to reimbursement is determined as long as those conditions set forth standards that are definitely ascertainable and can only be fulfilled prior to, or through completion of, your return move to your former principal place of work. File 2006 tax return Alternative Basis If you are an employee, you can determine the source of your compensation under an alternative basis if you establish to the satisfaction of the IRS that, under the facts and circumstances of your case, the alternative basis more properly determines the source of your compensation than the time or geographical basis. File 2006 tax return If you use an alternative basis, you must keep (and have available for inspection) records to document why the alternative basis more properly determines the source of your compensation. File 2006 tax return Also, if your total compensation from all sources is $250,000 or more, check “Yes” to both questions on line K on page 5 of Form 1040NR, and attach a written statement to your tax return that sets forth all of the following. File 2006 tax return Your name and social security number (written across the top of the statement). File 2006 tax return The specific compensation income, or the specific fringe benefit, for which you are using the alternative basis. File 2006 tax return For each item in (2), the alternative basis of allocation of source used. File 2006 tax return For each item in (2), a computation showing how the alternative allocation was computed. File 2006 tax return A comparison of the dollar amount of the U. File 2006 tax return S. File 2006 tax return compensation and foreign compensation sourced under both the alternative basis and the time or geographical basis discussed earlier. File 2006 tax return Transportation Income Transportation income is income from the use of a vessel or aircraft or for the performance of services directly related to the use of any vessel or aircraft. File 2006 tax return This is true whether the vessel or aircraft is owned, hired, or leased. File 2006 tax return The term “vessel or aircraft” includes any container used in connection with a vessel or aircraft. File 2006 tax return All income from transportation that begins and ends in the United States is treated as derived from sources in the United States. File 2006 tax return If the transportation begins or ends in the United States, 50% of the transportation income is treated as derived from sources in the United States. File 2006 tax return For transportation income from personal services, 50% of the income is U. File 2006 tax return S. File 2006 tax return source income if the transportation is between the United States and a U. File 2006 tax return S. File 2006 tax return possession. File 2006 tax return For nonresident aliens, this only applies to income derived from, or in connection with, an aircraft. File 2006 tax return For information on how U. File 2006 tax return S. File 2006 tax return source transportation income is taxed, see chapter 4. File 2006 tax return Scholarships, Grants, Prizes, and Awards Generally, the source of scholarships, fellowship grants, grants, prizes, and awards is the residence of the payer regardless of who actually disburses the funds. File 2006 tax return However, see Activities to be performed outside the United States , later. File 2006 tax return For example, payments for research or study in the United States made by the United States, a noncorporate U. File 2006 tax return S. File 2006 tax return resident, or a domestic corporation, are from U. File 2006 tax return S. File 2006 tax return sources. File 2006 tax return Similar payments from a foreign government or foreign corporation are foreign source payments even though the funds may be disbursed through a U. File 2006 tax return S. File 2006 tax return agent. File 2006 tax return Payments made by an entity designated as a public international organization under the International Organizations Immunities Act are from foreign sources. File 2006 tax return Activities to be performed outside the United States. File 2006 tax return   Scholarships, fellowship grants, targeted grants, and achievement awards received by nonresident aliens for activities performed, or to be performed, outside the United States are not U. File 2006 tax return S. File 2006 tax return source income. File 2006 tax return    These rules do not apply to amounts paid as salary or other compensation for services. File 2006 tax return See Personal Services, earlier, for the source rules that apply. File 2006 tax return Pensions and Annuities If you receive a pension from a domestic trust for services performed both in and outside the United States, part of the pension payment is from U. File 2006 tax return S. File 2006 tax return sources. File 2006 tax return That part is the amount attributable to earnings of the pension plan and the employer contributions made for services performed in the United States. File 2006 tax return This applies whether the distribution is made under a qualified or nonqualified stock bonus, pension, profit-sharing, or annuity plan (whether or not funded). File 2006 tax return If you performed services as an employee of the United States, you may receive a distribution from the U. File 2006 tax return S. File 2006 tax return Government under a plan, such as the Civil Service Retirement System, that is treated as a qualified pension plan. File 2006 tax return Your U. File 2006 tax return S. File 2006 tax return source income is the otherwise taxable amount of the distribution that is attributable to your total U. File 2006 tax return S. File 2006 tax return Government basic pay other than tax-exempt pay for services performed outside the United States. File 2006 tax return Rents or Royalties Your U. File 2006 tax return S. File 2006 tax return source income includes rent and royalty income received during the tax year from property located in the United States or from any interest in that property. File 2006 tax return U. File 2006 tax return S. File 2006 tax return source income also includes rents or royalties for the use of, or for the privilege of using, in the United States, intangible property such as patents, copyrights, secret processes and formulas, goodwill, trademarks, franchises, and similar property. File 2006 tax return Real Property Real property is land and buildings and generally anything built on, growing on, or attached to land. File 2006 tax return Gross income from sources in the United States includes gains, profits, and income from the sale or other disposition of real property located in the United States. File 2006 tax return Natural resources. File 2006 tax return   The income from the sale of products of any farm, mine, oil or gas well, other natural deposit, or timber located in the United States and sold in a foreign country, or located in a foreign country and sold in the United States, is partly from sources in the United States. File 2006 tax return For information on determining that part, see section 1. File 2006 tax return 863-1(b) of the regulations. File 2006 tax return Table 2-1. File 2006 tax return Summary of Source Rules for Income of Nonresident Aliens Item of income Factor determining source Salaries, wages, other compensation Where services performed Business income:   Personal services Where services performed Sale of inventory—purchased Where sold Sale of inventory—produced Allocation Interest Residence of payer Dividends Whether a U. File 2006 tax return S. File 2006 tax return or foreign corporation* Rents Location of property Royalties:   Natural resources Location of property Patents, copyrights, etc. File 2006 tax return Where property is used Sale of real property Location of property Sale of personal property Seller's tax home (but see Personal Property , later, for exceptions) Pension distributions attributable to contributions Where services were performed that earned the pension Investment earnings on pension contributions Location of pension trust Sale of natural resources Allocation based on fair market value of product at export terminal. File 2006 tax return For more information, see section 1. File 2006 tax return 863-1(b) of the regulations. File 2006 tax return *Exceptions include: a) Dividends paid by a U. File 2006 tax return S. File 2006 tax return corporation are foreign source if the corporation elects the  American Samoa economic development credit. File 2006 tax return  b) Part of a dividend paid by a foreign corporation is U. File 2006 tax return S. File 2006 tax return source if at least 25% of the  corporation's gross income is effectively connected with a U. File 2006 tax return S. File 2006 tax return trade or business for the  3 tax years before the year in which the dividends are declared. File 2006 tax return Personal Property Personal property is property, such as machinery, equipment, or furniture, that is not real property. File 2006 tax return Gain or loss from the sale or exchange of personal property generally has its source in the United States if you have a tax home in the United States. File 2006 tax return If you do not have a tax home in the United States, the gain or loss generally is considered to be from sources outside the United States. File 2006 tax return Tax home. File 2006 tax return   Your tax home is the general area of your main place of business, employment, or post of duty, regardless of where you maintain your family home. File 2006 tax return Your tax home is the place where you permanently or indefinitely work as an employee or a self-employed individual. File 2006 tax return If you do not have a regular or main place of business because of the nature of your work, then your tax home is the place where you regularly live. File 2006 tax return If you do not fit either of these categories, you are considered an itinerant and your tax home is wherever you work. File 2006 tax return Inventory property. File 2006 tax return   Inventory property is personal property that is stock in trade or that is held primarily for sale to customers in the ordinary course of your trade or business. File 2006 tax return Income from the sale of inventory that you purchased is sourced where the property is sold. File 2006 tax return Generally, this is where title to the property passes to the buyer. File 2006 tax return For example, income from the sale of inventory in the United States is U. File 2006 tax return S. File 2006 tax return source income, whether you purchased it in the United States or in a foreign country. File 2006 tax return   Income from the sale of inventory property that you produced in the United States and sold outside the United States (or vice versa) is partly from sources in the United States and partly from sources outside the United States. File 2006 tax return For information on making this allocation, see section 1. File 2006 tax return 863-3 of the regulations. File 2006 tax return   These rules apply even if your tax home is not in the United States. File 2006 tax return Depreciable property. File 2006 tax return   To determine the source of any gain from the sale of depreciable personal property, you must first figure the part of the gain that is not more than the total depreciation adjustments on the property. File 2006 tax return You allocate this part of the gain to sources in the United States based on the ratio of U. File 2006 tax return S. File 2006 tax return depreciation adjustments to total depreciation adjustments. File 2006 tax return The rest of this part of the gain is considered to be from sources outside the United States. File 2006 tax return   For this purpose, “U. File 2006 tax return S. File 2006 tax return depreciation adjustments” are the depreciation adjustments to the basis of the property that are allowable in figuring taxable income from U. File 2006 tax return S. File 2006 tax return sources. File 2006 tax return However, if the property is used predominantly in the United States during a tax year, all depreciation deductions allowable for that year are treated as U. File 2006 tax return S. File 2006 tax return depreciation adjustments. File 2006 tax return But there are some exceptions for certain transportation, communications, and other property used internationally. File 2006 tax return   Gain from the sale of depreciable property that is more than the total depreciation adjustments on the property is sourced as if the property were inventory property, as discussed above. File 2006 tax return   A loss is sourced in the same way as the depreciation deductions were sourced. File 2006 tax return However, if the property was used predominantly in the United States, the entire loss reduces U. File 2006 tax return S. File 2006 tax return source income. File 2006 tax return   The basis of property usually means the cost (money plus the fair market value of other property or services) of property you acquire. File 2006 tax return Depreciation is an amount deducted to recover the cost or other basis of a trade or business asset. File 2006 tax return The amount you can deduct depends on the property's cost, when you began using the property, how long it will take to recover your cost, and which depreciation method you use. File 2006 tax return A depreciation deduction is any deduction for depreciation or amortization or any other allowable deduction that treats a capital expenditure as a deductible expense. File 2006 tax return Intangible property. File 2006 tax return   Intangible property includes patents, copyrights, secret processes or formulas, goodwill, trademarks, trade names, or other like property. File 2006 tax return The gain from the sale of amortizable or depreciable intangible property, up to the previously allowable amortization or depreciation deductions, is sourced in the same way as the original deductions were sourced. File 2006 tax return This is the same as the source rule for gain from the sale of depreciable property. File 2006 tax return See Depreciable property , earlier, for details on how to apply this rule. File 2006 tax return   Gain in excess of the amortization or depreciation deductions is sourced in the country where the property is used if the income from the sale is contingent on the productivity, use, or disposition of that property. File 2006 tax return If the income is not contingent on the productivity, use, or disposition of the property, the income is sourced according to your tax home as discussed earlier. File 2006 tax return If payments for goodwill do not depend on its productivity, use, or disposition, their source is the country in which the goodwill was generated. File 2006 tax return Sales through offices or fixed places of business. File 2006 tax return   Despite any of the earlier rules, if you do not have a tax home in the United States, but you maintain an office or other fixed place of business in the United States, treat the income from any sale of personal property (including inventory property) that is attributable to that office or place of business as U. File 2006 tax return S. File 2006 tax return source income. File 2006 tax return However, this rule does not apply to sales of inventory property for use, disposition, or consumption outside the United States if your office or other fixed place of business outside the United States materially participated in the sale. File 2006 tax return   If you have a tax home in the United States but maintain an office or other fixed place of business outside the United States, income from sales of personal property, other than inventory, depreciable property, or intangibles, that is attributable to that foreign office or place of business may be treated as U. File 2006 tax return S. File 2006 tax return source income. File 2006 tax return The income is treated as U. File 2006 tax return S. File 2006 tax return source income if an income tax of less than 10% of the income from the sale is paid to a foreign country. File 2006 tax return This rule also applies to losses if the foreign country would have imposed an income tax of less than 10% had the sale resulted in a gain. File 2006 tax return Community Income If you are married and you or your spouse is subject to the community property laws of a foreign country, a U. File 2006 tax return S. File 2006 tax return state, or a U. File 2006 tax return S. File 2006 tax return possession, you generally must follow those laws to determine the income of yourself and your spouse for U. File 2006 tax return S. File 2006 tax return tax purposes. File 2006 tax return But you must disregard certain community property laws if: Both you and your spouse are nonresident aliens, or One of you is a nonresident alien and the other is a U. File 2006 tax return S. File 2006 tax return citizen or resident and you do not both choose to be treated as U. File 2006 tax return S. File 2006 tax return residents as explained in chapter 1. File 2006 tax return In these cases, you and your spouse must report community income as explained later. File 2006 tax return Earned income. File 2006 tax return   Earned income of a spouse, other than trade or business income and a partner's distributive share of partnership income, is treated as the income of the spouse whose services produced the income. File 2006 tax return That spouse must report all of it on his or her separate return. File 2006 tax return Trade or business income. File 2006 tax return   Trade or business income, other than a partner's distributive share of partnership income, is treated as the income of the spouse carrying on the trade or business. File 2006 tax return That spouse must report all of it on his or her separate return. File 2006 tax return Partnership income (or loss). File 2006 tax return   A partner's distributive share of partnership income (or loss) is treated as the income (or loss) of the partner. File 2006 tax return The partner must report all of it on his or her separate return. File 2006 tax return Separate property income. File 2006 tax return   Income derived from the separate property of one spouse (and which is not earned income, trade or business income, or partnership distributive share income) is treated as the income of that spouse. File 2006 tax return That spouse must report all of it on his or her separate return. File 2006 tax return Use the appropriate community property law to determine what is separate property. File 2006 tax return Other community income. File 2006 tax return   All other community income is treated as provided by the applicable community property laws. File 2006 tax return Prev  Up  Next   Home   More Online Publications
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Know Your Rights When Shopping for Credit

Like everything else you buy, it pays to comparison shop for credit. Check financial and banking websites to find up-to-date interest rate reports on mortgages, auto loans, credit cards, home equity loans, and other banking products. The Equal Credit Opportunity Act protects you when dealing with anyone who regularly offers credit, including banks, finance companies, stores, credit card companies and credit unions. When you apply for credit, a creditor may not:

  • Ask about or consider your sex, race, national origin or religion.
  • Ask about your marital status or your spouse, unless you are applying for a joint account or relying on your spouse's income, or you live in a community property state (Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, or Wisconsin)
  • Ask about your plans to have or raise children
  • Refuse to consider public assistance income or regularly received alimony or child support
  • Refuse to consider income because of your sex or marital status or because it is from part-time work or retirement benefits

You have the right to:

  • Have credit in your birth name, your first name and your spouse/ partner's last name, or your first name and a combined last name
  • Have a co-signer other than your spouse if one is necessary
  • Keep your own accounts after you change your name or marital status or retire, unless the creditor has evidence you are unable or unwilling to pay
  • Know why a credit application was rejected-the creditor must give you the specific reasons or tell you where and how you can get them if you ask within 60 days
  • Have accounts shared with your spouse reported in both your names
  • Know how much it will cost to borrow money
  • YOU HAVE THE RIGHT TO A FREE ANNUAL CREDIT REPORT .

For additional information on credit, see Buying a Home. Other sources of information include the HUD Housing Counseling Clearinghouse (1-888-466-3487), the FTC and the National Consumer Law Center.

The File 2006 Tax Return

File 2006 tax return Index A Advance EIC tables, instructions, Advance Payment Methods for the Earned Income Credit (EIC) Aliens, nonresident, Withholding Income Taxes on the Wages of Nonresident Alien Employees Alternative methods of withholding, Alternative Methods for Figuring Withholding C Combined income tax, employee social security tax, and employee Medicare tax withholding tables, Combined Income Tax, Employee Social Security Tax, and Employee Medicare Tax Withholding Tables F Formula tables for percentage method withholding (for automated payroll systems), Formula Tables for Percentage Method Withholding (for Automated Payroll Systems) I Introduction, Introduction N Nonresident alien employees, Withholding Income Taxes on the Wages of Nonresident Alien Employees Notice to employers, Notice to Employers Q Qualified transportation benefits Commuter highway vehicle transportation, Increased Exclusion Amount for Combined Commuter Highway Vehicle Transportation and Transit Passes Transit passes, Increased Exclusion Amount for Combined Commuter Highway Vehicle Transportation and Transit Passes W Wage bracket percentage method tables (for automated payroll systems), Wage Bracket Percentage Method Tables (for Automated Payroll Systems) Withholding income taxes on wages Nonresident alien employees, Withholding Income Taxes on the Wages of Nonresident Alien Employees Withholding: Alternative methods, Alternative Methods for Figuring Withholding Percentage method, Percentage Method Wage bracket method, Wage Bracket Method Prev  Up     Home   More Online Publications