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Filemy2010taxreturnforfree

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Filemy2010taxreturnforfree

Filemy2010taxreturnforfree Index A Abroad, citizens living, filing requirements, U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree Citizens or Resident Aliens Living Abroad Absence, temporary, Temporary absences. Filemy2010taxreturnforfree , Temporary absences. Filemy2010taxreturnforfree , Temporary absences. Filemy2010taxreturnforfree Accounting periods, joint returns, Accounting period. Filemy2010taxreturnforfree Adopted child, Exception for adopted child. Filemy2010taxreturnforfree , Adopted child. Filemy2010taxreturnforfree , Adopted child. Filemy2010taxreturnforfree Taxpayer identification number, Taxpayer identification numbers for adoptees. Filemy2010taxreturnforfree Age Filing status determination, Age. Filemy2010taxreturnforfree Gross income and filing requirements (Table 1), Table 1. Filemy2010taxreturnforfree 2013 Filing Requirements Chart for Most Taxpayers Standard deduction for age 65 or older, Higher Standard Deduction for Age (65 or Older) Test, Age Test Aliens Dual-status (see Dual-status taxpayers) Nonresident (see Nonresident aliens) Alimony, Alimony. Filemy2010taxreturnforfree Alternative minimum tax (AMT), effect on filing requirements (Table 3), Table 3. Filemy2010taxreturnforfree Other Situations When You Must File a 2013 Return Amended returns, Joint Return After Separate Returns, Changing your mind. Filemy2010taxreturnforfree (see also Form 1040X) Change from itemized to standard deduction (or vice versa), Electing to itemize for state tax or other purposes. Filemy2010taxreturnforfree American citizens abroad, U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree Citizens or Resident Aliens Living Abroad Annulled marriages, filing status, Annulled marriages. Filemy2010taxreturnforfree Armed forces Combat zone, signing return for spouse, Spouse in combat zone. Filemy2010taxreturnforfree Dependency allotments, Armed Forces dependency allotments. Filemy2010taxreturnforfree GI Bill benefits, Tuition payments and allowances under the GI Bill. Filemy2010taxreturnforfree Military quarters allotments, Tax-exempt military quarters allowances. Filemy2010taxreturnforfree Assistance (see Tax help) ATINs (Adoption taxpayer identification numbers), Taxpayer identification numbers for adoptees. Filemy2010taxreturnforfree B Birth of child, Death or birth. Filemy2010taxreturnforfree Blind persons, standard deduction, Higher Standard Deduction for Blindness C Canada, resident of, U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree citizen or resident alien. Filemy2010taxreturnforfree , Citizen or Resident Test, Child in Canada or Mexico. Filemy2010taxreturnforfree Capital expenses, Capital expenses. Filemy2010taxreturnforfree Child born alive, Child born alive. Filemy2010taxreturnforfree Child care expenses, Child care expenses. Filemy2010taxreturnforfree Child custody, Custodial parent and noncustodial parent. Filemy2010taxreturnforfree Child support under pre-1985 agreement, Child support under pre-1985 agreement. Filemy2010taxreturnforfree Child tax credit, Child tax credit. Filemy2010taxreturnforfree Child, qualifying, Qualifying Child Children Adopted child (see Adoption) Adoption (see Adopted child) Birth of child, Death or birth. Filemy2010taxreturnforfree , Death or birth. Filemy2010taxreturnforfree Claiming parent, when child is head of household, Special rule for parent. Filemy2010taxreturnforfree Custody of, Custodial parent and noncustodial parent. Filemy2010taxreturnforfree Death of child, Death or birth. Filemy2010taxreturnforfree , Death or birth. Filemy2010taxreturnforfree Dividends of, Unearned income. Filemy2010taxreturnforfree Filing requirements as dependents (Table 2), Table 2. Filemy2010taxreturnforfree 2013 Filing Requirements for Dependents Investment income of child under age 18, Table 2. Filemy2010taxreturnforfree 2013 Filing Requirements for Dependents , Unearned income. Filemy2010taxreturnforfree Kidnapped, Kidnapped child. Filemy2010taxreturnforfree , Kidnapped child. Filemy2010taxreturnforfree Social security number, Social Security Numbers for Dependents Stillborn, Stillborn child. Filemy2010taxreturnforfree Church employees, filing requirements (Table 3), Table 3. Filemy2010taxreturnforfree Other Situations When You Must File a 2013 Return Citizen or resident test, Citizen or Resident Test Citizens outside U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree , filing requirements, U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree Citizens or Resident Aliens Living Abroad Common law marriage, Considered married. Filemy2010taxreturnforfree Community property states, Community property states. Filemy2010taxreturnforfree Cousin, Cousin. Filemy2010taxreturnforfree Custody of child, Custodial parent and noncustodial parent. Filemy2010taxreturnforfree D Death Of child, Death or birth of child. Filemy2010taxreturnforfree Of dependent, Death or birth. Filemy2010taxreturnforfree , Death or birth. Filemy2010taxreturnforfree Of spouse, Spouse died during the year. Filemy2010taxreturnforfree , Spouse died. Filemy2010taxreturnforfree , Spouse died before signing. Filemy2010taxreturnforfree , Death of spouse. Filemy2010taxreturnforfree Decedents, Spouse died during the year. Filemy2010taxreturnforfree , Decedent's final return. Filemy2010taxreturnforfree (see also Death of spouse) Filing requirements, Deceased Persons Deductions Personal exemption, Personal Exemptions Standard deduction, Standard Deduction Dependent taxpayer test, Dependent Taxpayer Test Dependents Birth of, Death or birth. Filemy2010taxreturnforfree Born and died within year, Born and died in 2013. Filemy2010taxreturnforfree Child's earnings, Child's earnings. Filemy2010taxreturnforfree Death of, Death or birth. Filemy2010taxreturnforfree Earned income, Earned income. Filemy2010taxreturnforfree Exemption for, Exemptions for Dependents Filing requirements, Table 2. Filemy2010taxreturnforfree 2013 Filing Requirements for Dependents , Dependents Married, filing joint return, Joint Return Test, Joint Return Test (To Be a Qualifying Child) Not allowed to claim dependents, Dependent Taxpayer Test Qualifying child, Qualifying Child Qualifying relative, Qualifying Relative Social security number, Social Security Numbers for Dependents, Taxpayer identification numbers for adoptees. Filemy2010taxreturnforfree Standard deduction for, Standard Deduction for Dependents Unearned income, Unearned income. Filemy2010taxreturnforfree Disabled Child, Permanently and totally disabled. Filemy2010taxreturnforfree Dependent, Disabled dependent working at sheltered workshop. Filemy2010taxreturnforfree Divorced parents, Children of divorced or separated parents (or parents who live apart). Filemy2010taxreturnforfree Divorced taxpayers Child custody, Custodial parent and noncustodial parent. Filemy2010taxreturnforfree Filing status, Divorced persons. Filemy2010taxreturnforfree , Divorce and remarriage. Filemy2010taxreturnforfree , Divorced persons. Filemy2010taxreturnforfree Joint returns, responsibility for, Divorced taxpayer. Filemy2010taxreturnforfree Personal exemption, Divorced or separated spouse. Filemy2010taxreturnforfree Domestic help, no exemption for, Housekeepers, maids, or servants. Filemy2010taxreturnforfree Dual-status taxpayers Exemptions, Dual-status taxpayers. Filemy2010taxreturnforfree Joint returns not available, Nonresident alien or dual-status alien. Filemy2010taxreturnforfree E Earned income Defined for purposes of standard deduction, Earned income defined. Filemy2010taxreturnforfree Dependent filing requirements (Table 2), Table 2. Filemy2010taxreturnforfree 2013 Filing Requirements for Dependents Earned income credit Two persons with same qualifying child, Special Rule for Qualifying Child of More Than One Person Elderly persons Home for the aged, Home for the aged. Filemy2010taxreturnforfree Standard deduction for age 65 or older, Higher Standard Deduction for Age (65 or Older) Equitable relief, Innocent spouse, Relief from joint responsibility. Filemy2010taxreturnforfree Exemptions, Exemptions, Taxpayer identification numbers for adoptees. Filemy2010taxreturnforfree Dependents, Exemptions for Dependents Personal (see Personal exemption) F Fair rental value, Fair rental value defined. Filemy2010taxreturnforfree Figures (see Tables and figures) Filing requirements, Who Must File, Filing Status Filing status, Filing Status, Qualifying Widow(er) With Dependent Child Annulled marriages, Annulled marriages. Filemy2010taxreturnforfree Change to Joint return after separate returns, Joint Return After Separate Returns Separate returns after joint return, Separate Returns After Joint Return, Kidnapped child. Filemy2010taxreturnforfree Determination of, Filing status. Filemy2010taxreturnforfree , Filing Status Head of household, Head of household or qualifying widow(er) with dependent child. Filemy2010taxreturnforfree , Head of Household Marital status, determination of, Marital Status Married filing jointly (see Joint returns) Married filing separately (see Married filing separately) Unmarried persons (see Single taxpayers) Food benefits, Support provided by the state (welfare, food benefits, housing, etc. Filemy2010taxreturnforfree ). Filemy2010taxreturnforfree Foreign employment, filing requirements, U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree Citizens or Resident Aliens Living Abroad Foreign students, Foreign students' place of residence. Filemy2010taxreturnforfree Form 1040 Personal exemption, Form 1040 filers. Filemy2010taxreturnforfree Social security numbers, Social Security Numbers for Dependents Use of, How to file. Filemy2010taxreturnforfree , How to file. Filemy2010taxreturnforfree , How to file. Filemy2010taxreturnforfree Form 1040A Personal exemption, Form 1040A filers. Filemy2010taxreturnforfree Social security numbers, Social Security Numbers for Dependents Use of, How to file. Filemy2010taxreturnforfree , How to file. Filemy2010taxreturnforfree , How to file. Filemy2010taxreturnforfree Form 1040EZ Personal exemption, Form 1040EZ filers. Filemy2010taxreturnforfree Use of, How to file. Filemy2010taxreturnforfree , How to file. Filemy2010taxreturnforfree Form 1040X Change of filing status, Joint Return After Separate Returns Itemized deductions, change to standard deduction, Changing your mind. Filemy2010taxreturnforfree Standard deduction, change to itemized deductions, Changing your mind. Filemy2010taxreturnforfree Form 1099-B, Form 1099-B received. Filemy2010taxreturnforfree Form 8814, parents' election to report child's interest and dividends, Election to report child's unearned income on parent's return. Filemy2010taxreturnforfree Form 8857, innocent spouse relief, Relief from joint responsibility. Filemy2010taxreturnforfree Form SS-5, social security number request, No SSN. Filemy2010taxreturnforfree Form W-7, individual taxpayer identification number request, Taxpayer identification numbers for aliens. Filemy2010taxreturnforfree Form W-7A, adoption taxpayer identification number request, Taxpayer identification numbers for adoptees. Filemy2010taxreturnforfree Foster care payments and expenses, Foster care payments and expenses. Filemy2010taxreturnforfree , Foster care. Filemy2010taxreturnforfree Foster child, Foster child. Filemy2010taxreturnforfree , Foster care payments and expenses. Filemy2010taxreturnforfree , Foster child. Filemy2010taxreturnforfree , Foster care. Filemy2010taxreturnforfree Free tax services, Free help with your tax return. Filemy2010taxreturnforfree Funeral expenses, Do Not Include in Total Support G GI Bill benefits, Tuition payments and allowances under the GI Bill. Filemy2010taxreturnforfree Gross income Defined, Gross income. Filemy2010taxreturnforfree Filing requirements (Table 1), Table 1. Filemy2010taxreturnforfree 2013 Filing Requirements Chart for Most Taxpayers Dependent filing requirements (Table 2), Table 2. Filemy2010taxreturnforfree 2013 Filing Requirements for Dependents Test, Gross Income Test Group-term life insurance, Table 3. Filemy2010taxreturnforfree Other Situations When You Must File a 2013 Return H Head of household, Head of Household, Kidnapped child. Filemy2010taxreturnforfree Exemption for spouse, Head of household. Filemy2010taxreturnforfree Filing requirements (Table 1), Table 1. Filemy2010taxreturnforfree 2013 Filing Requirements Chart for Most Taxpayers Health insurance premiums, Medical insurance premiums. Filemy2010taxreturnforfree Help (see Tax help) Home Aged, home for, Home for the aged. Filemy2010taxreturnforfree Cost of keeping up, Keeping Up a Home Household workers, no exemption for, Housekeepers, maids, or servants. Filemy2010taxreturnforfree I Income Gross, Gross Income Test Tax exempt, Tax-exempt income. Filemy2010taxreturnforfree Individual retirement arrangements (IRAs) Filing requirements (Table 3), Table 3. Filemy2010taxreturnforfree Other Situations When You Must File a 2013 Return Married filing separately, Individual retirement arrangements (IRAs). Filemy2010taxreturnforfree Individual taxpayer identification numbers (ITINs), Reminders, Taxpayer identification numbers for aliens. Filemy2010taxreturnforfree Innocent spouse relief, Relief from joint responsibility. Filemy2010taxreturnforfree Insurance premiums Life, Do Not Include in Total Support Medical, Medical insurance premiums. Filemy2010taxreturnforfree IRAs (see Individual retirement arrangements (IRAs)) Itemized deductions Changing from standard to itemized deduction (or vice versa), Changing your mind. Filemy2010taxreturnforfree Choosing to itemize, Who Should Itemize Married filing separately, Married persons who filed separate returns. Filemy2010taxreturnforfree When to itemize, When to itemize. Filemy2010taxreturnforfree ITINs (Individual taxpayer identification numbers), Taxpayer identification numbers for aliens. Filemy2010taxreturnforfree J Joint return test, Joint Return Test, Joint Return Test (To Be a Qualifying Child) Joint returns, Married Filing Jointly, Nonresident alien or dual-status alien. Filemy2010taxreturnforfree Dependents on, Joint return. Filemy2010taxreturnforfree Personal exemption, Joint return. Filemy2010taxreturnforfree K Kidnapped children Qualifying child, Kidnapped child. Filemy2010taxreturnforfree Qualifying relative, Kidnapped child. Filemy2010taxreturnforfree Widow(er) with dependent child, Death or birth. Filemy2010taxreturnforfree L Life insurance premiums, Do Not Include in Total Support Local income taxes, itemized deductions, Electing to itemize for state tax or other purposes. Filemy2010taxreturnforfree Local law violated, Local law violated. Filemy2010taxreturnforfree Lodging, Lodging. Filemy2010taxreturnforfree Losses, rental real estate, Rental activity losses. Filemy2010taxreturnforfree M Marital status, determination of, Marital Status Married dependents, filing joint return, Joint Return Test, Joint Return Test (To Be a Qualifying Child) Married filing jointly (see Joint returns) Married filing separately, Married Filing Separately Changing method from or to itemized deductions, Changing your mind. Filemy2010taxreturnforfree Exemption for spouse, Separate return. Filemy2010taxreturnforfree Itemized deductions, Married persons who filed separate returns. Filemy2010taxreturnforfree Married taxpayers, Married Filing Jointly (see also Joint returns) Age 65 or older spouse, standard deduction, Higher Standard Deduction for Age (65 or Older), Spouse 65 or Older or Blind Blind spouse, standard deduction, Higher Standard Deduction for Blindness, Spouse 65 or Older or Blind Dual-status alien spouse, Nonresident alien or dual-status alien. Filemy2010taxreturnforfree Filing status, Married persons. Filemy2010taxreturnforfree Medical insurance premiums, Medical insurance premiums. Filemy2010taxreturnforfree Medical savings accounts (MSAs, effect on filing requirements (Table 3), Table 3. Filemy2010taxreturnforfree Other Situations When You Must File a 2013 Return Medicare taxes, not support, Do Not Include in Total Support Member of household or relationship test, Member of Household or Relationship Test Mexico, resident of, U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree citizen or resident alien. Filemy2010taxreturnforfree , Citizen or Resident Test, Child in Canada or Mexico. Filemy2010taxreturnforfree Military (see Armed forces) Missing children, photographs of in IRS publications, Reminders Multiple support agreement, Multiple Support Agreement N National of the United States, U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree national. Filemy2010taxreturnforfree Nonresident aliens, Nonresident aliens. Filemy2010taxreturnforfree Dependents, Taxpayer identification numbers for aliens. Filemy2010taxreturnforfree Exemptions, Nonresident aliens. Filemy2010taxreturnforfree Joint return, Nonresident alien or dual-status alien. Filemy2010taxreturnforfree Spouse, Nonresident alien spouse. Filemy2010taxreturnforfree Taxpayer identification number, Taxpayer identification numbers for aliens. Filemy2010taxreturnforfree O Overseas taxpayers, U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree Citizens or Resident Aliens Living Abroad P Parent, claiming head of household for, Special rule for parent. Filemy2010taxreturnforfree Parents who never married, Parents who never married. Filemy2010taxreturnforfree Parents, divorced or separated, Children of divorced or separated parents (or parents who live apart). Filemy2010taxreturnforfree Penalty, failure to file, Who Must File Personal exemption, Personal Exemptions Photographs of missing children in IRS publications, Reminders Publications (see Tax help) Puerto Rico, residents of, Residents of Puerto Rico Q Qualifying Child, Qualifying Child Relative, Qualifying Relative Surviving spouse, Qualifying Widow(er) With Dependent Child Widow/widower, Qualifying Widow(er) With Dependent Child R Recapture taxes, Table 3. Filemy2010taxreturnforfree Other Situations When You Must File a 2013 Return Relationship test, Relationship Test, Member of Household or Relationship Test Relative, qualifying, Qualifying Relative Remarriage after divorce, Divorce and remarriage. Filemy2010taxreturnforfree Rental losses, Rental activity losses. Filemy2010taxreturnforfree Residency test, Residency Test S Same-sex marriage Filing status, Same-sex marriage. Filemy2010taxreturnforfree Scholarships, Earned income. Filemy2010taxreturnforfree , Scholarships. Filemy2010taxreturnforfree , Gross income defined. Filemy2010taxreturnforfree , Do Not Include in Total Support , Earned income defined. Filemy2010taxreturnforfree Self-employed persons Filing requirements (Table 3), Table 3. Filemy2010taxreturnforfree Other Situations When You Must File a 2013 Return Gross income, Self-employed persons. Filemy2010taxreturnforfree Separate returns (see Married filing separately) Separated parents, Children of divorced or separated parents (or parents who live apart). Filemy2010taxreturnforfree Separated taxpayers Filing status, Considered married. Filemy2010taxreturnforfree , Married persons living apart. Filemy2010taxreturnforfree Living apart but not legally separated, Considered married. Filemy2010taxreturnforfree Personal exemption, Divorced or separated spouse. Filemy2010taxreturnforfree Signatures, joint returns, Signing a joint return. Filemy2010taxreturnforfree Single taxpayers Filing status, Unmarried persons. Filemy2010taxreturnforfree , Single Gross income filing requirements (Table 1), Table 1. Filemy2010taxreturnforfree 2013 Filing Requirements Chart for Most Taxpayers How to file and forms, How to file. Filemy2010taxreturnforfree Personal exemption, Your Own Exemption Social security and Medicare taxes Reporting of (Table 3), Table 3. Filemy2010taxreturnforfree Other Situations When You Must File a 2013 Return Support, not included in, Do Not Include in Total Support Social security benefits, Social security benefits. Filemy2010taxreturnforfree Social security numbers (SSNs) for dependents, Social Security Numbers for Dependents Spouse Deceased, Spouse died. Filemy2010taxreturnforfree , Spouse died before signing. Filemy2010taxreturnforfree , Death of spouse. Filemy2010taxreturnforfree Dual-status alien spouse, Nonresident alien or dual-status alien. Filemy2010taxreturnforfree Exemption for, Your Spouse's Exemption Innocent spouse relief, Relief from joint responsibility. Filemy2010taxreturnforfree Nonresident alien, Nonresident alien spouse. Filemy2010taxreturnforfree Signing joint returns, Signing a joint return. Filemy2010taxreturnforfree Surviving (see Surviving spouse) SSNs (see Social security numbers (SSNs) for dependents) Standard deduction, What's New, Standard Deduction, Married persons who filed separate returns. Filemy2010taxreturnforfree Married filing jointly, Married Filing Jointly State or local income taxes, Electing to itemize for state tax or other purposes. Filemy2010taxreturnforfree Stillborn child, Stillborn child. Filemy2010taxreturnforfree Students Defined, Student defined. Filemy2010taxreturnforfree Foreign, Foreign students' place of residence. Filemy2010taxreturnforfree Support test Qualifying child, Support Test (To Be a Qualifying Child) Qualifying relative, Support Test (To Be a Qualifying Relative) Surviving spouse Death of spouse (see Death of spouse) Gross income filing requirements (Table 1), Table 1. Filemy2010taxreturnforfree 2013 Filing Requirements Chart for Most Taxpayers Single filing status, Widow(er). Filemy2010taxreturnforfree Widow(er) with dependent child, Qualifying Widow(er) With Dependent Child, How to file. Filemy2010taxreturnforfree , Death or birth. Filemy2010taxreturnforfree T Tables and figures, Keeping Up a Home, Worksheet 2. Filemy2010taxreturnforfree Worksheet for Determining Support (see also Worksheets) Filing requirements Dependents (Table 2), Table 2. Filemy2010taxreturnforfree 2013 Filing Requirements for Dependents Gross income levels (Table 1), Table 1. Filemy2010taxreturnforfree 2013 Filing Requirements Chart for Most Taxpayers Other situations requiring filing (Table 3), Table 3. Filemy2010taxreturnforfree Other Situations When You Must File a 2013 Return Tax help, How To Get Tax Help Tax returns Amended (see Form 1040X) Filing of (see Filing requirements) Joint returns (see Joint returns) Who must file, What's New, Who Must File, Filing Requirements for Most Taxpayers, Who Should File Tax-exempt income, Tax-exempt income. Filemy2010taxreturnforfree Taxes, not support, Do Not Include in Total Support Temporary absences, Temporary absences. Filemy2010taxreturnforfree , Temporary absences. Filemy2010taxreturnforfree Tiebreaker rules, Tiebreaker rules. Filemy2010taxreturnforfree Tips, reporting of (Table 3), Table 3. Filemy2010taxreturnforfree Other Situations When You Must File a 2013 Return Total support, Total Support Tuition, benefits under GI Bill, Tuition payments and allowances under the GI Bill. Filemy2010taxreturnforfree U U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree citizen or resident, Citizen or Resident Test U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree citizens filing abroad, filing requirements Filing requirements, U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree Citizens or Resident Aliens Living Abroad U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree national, U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree national. Filemy2010taxreturnforfree U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree possessions, income from, Individuals With Income From U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree Possessions Unmarried persons (see Single taxpayers) W Welfare benefits, Support provided by the state (welfare, food benefits, housing, etc. Filemy2010taxreturnforfree ). Filemy2010taxreturnforfree What's New, What's New Widow/widower (see Surviving spouse) Worksheets Exemption Phaseout, Worksheet 3. Filemy2010taxreturnforfree Worksheet for Determining the Deduction for Exemptions Head of household status and cost of keeping up home, Keeping Up a Home Support test, Worksheet 2. Filemy2010taxreturnforfree Worksheet for Determining Support Prev  Up     Home   More Online Publications
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SOI Tax Stats - Income from Trusts and Estates Statistics

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Snapshot of Estate and Trust Income Tax Statistics

The U.S. Income Tax Return for Estates and Trusts (Form 1041) is used to report the income, deductions, gains, and losses of estates and trusts, as well as distributions to beneficiaries and income tax liability. Entities are classified into types based on their purpose. These types include:

  • decedent's estates
  • simple trusts
  • complex trusts
  • qualified disability trusts
  • electing small business trust (ESBT)
  • grantor type trust
  • bankruptcy estates
  • pooled income funds

For information about selected terms and concepts, a description of the data sources and limitations, and links to recent revisions of Form 1041, please visit Income from Trusts and Estates Study Metadata.
 

Statistical Tables   SOI Bulletin Articles       Other IRS Data
 

 


Statistical Tables

The following tables are available as Microsoft Excel®  files.  A free Excel viewer is available for download, if needed.

Fiduciary Returns - Sources of Income, Deductions, and Tax Liability, by Tax Status and Size of Gross Income

Fiduciary Returns - Sources of Income, Deductions, and Tax Liability, by Type of Entity

Fiduciary Income and Deductions, by State and Entity Type

 

Archive - Fiduciary Income Tax Returns
 

To make customized tables using this data, please visit the Statistics of Income Tax Stats Table Wizard.

 

Projections

For selected tax returns, including the Form 1041, IRS's Office of Research produces annual forecasts of the number of returns that will be filed in future years.
    Projections of Returns to be Filed in Future Calendar Years


 

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SOI Bulletin Articles

The following are available as PDF files.  A free Adobe® reader is available for download, if needed.

 

  • Fiduciary Income Tax Returns

               2003-2004          1997          1982

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Other SOI Data on Trusts

Form 5227 is an information return filed by split-interest trusts, those who make distributions to both charitable and noncharitable beneficiaries, while providing tax benefits to their donor.  Certain charitable trusts, those treated as private foundations except that they are not exempt from income taxes, annually file Form 990-PF.

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Other IRS Data and Related Links

For tax administration data on this topic, as well as other types of taxes, choose from the links below.

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Page Last Reviewed or Updated: 06-Jan-2014

The Filemy2010taxreturnforfree

Filemy2010taxreturnforfree 4. Filemy2010taxreturnforfree   How Income of Aliens Is Taxed Table of Contents Introduction Topics - This chapter discusses: Useful Items - You may want to see: Resident Aliens Nonresident AliensTrade or Business in the United States Effectively Connected Income The 30% Tax Income From Real Property Transportation Tax Interrupted Period of Residence Expatriation TaxExpatriation Before June 4, 2004 Expatriation After June 3, 2004, and Before June 17, 2008 Expatriation After June 16, 2008 Introduction Resident and nonresident aliens are taxed in different ways. Filemy2010taxreturnforfree Resident aliens are generally taxed in the same way as U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree citizens. Filemy2010taxreturnforfree Nonresident aliens are taxed based on the source of their income and whether or not their income is effectively connected with a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree trade or business. Filemy2010taxreturnforfree The following discussions will help you determine if income you receive during the tax year is effectively connected with a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree trade or business and how it is taxed. Filemy2010taxreturnforfree Topics - This chapter discusses: Income that is effectively connected with a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree trade or business. Filemy2010taxreturnforfree Income that is not effectively connected with a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree trade or business. Filemy2010taxreturnforfree Interrupted period of residence. Filemy2010taxreturnforfree Expatriation tax. Filemy2010taxreturnforfree Useful Items - You may want to see: Publication 544 Sales and Other Dispositions of Assets 1212 List of Original Issue Discount Instruments Form (and Instructions) 6251 Alternative Minimum Tax—Individuals Schedule D (Form 1040) Capital Gains and Losses See chapter 12 for information about getting these publications and forms. Filemy2010taxreturnforfree Resident Aliens Resident aliens are generally taxed in the same way as U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree citizens. Filemy2010taxreturnforfree This means that their worldwide income is subject to U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree tax and must be reported on their U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree tax return. Filemy2010taxreturnforfree Income of resident aliens is subject to the graduated tax rates that apply to U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree citizens. Filemy2010taxreturnforfree Resident aliens use the Tax Table or Tax Computation Worksheets located in the Form 1040 instructions, which apply to U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree citizens. Filemy2010taxreturnforfree Nonresident Aliens A nonresident alien's income that is subject to U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree income tax must be divided into two categories: Income that is effectively connected with a trade or business in the United States, and Income that is not effectively connected with a trade or business in the United States (discussed under The 30% Tax, later). Filemy2010taxreturnforfree The difference between these two categories is that effectively connected income, after allowable deductions, is taxed at graduated rates. Filemy2010taxreturnforfree These are the same rates that apply to U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree citizens and residents. Filemy2010taxreturnforfree Income that is not effectively connected is taxed at a flat 30% (or lower treaty) rate. Filemy2010taxreturnforfree If you were formerly a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree citizen or resident alien, these rules may not apply. Filemy2010taxreturnforfree See Expatriation Tax, later, in this chapter. Filemy2010taxreturnforfree Trade or Business in the United States Generally, you must be engaged in a trade or business during the tax year to be able to treat income received in that year as effectively connected with that trade or business. Filemy2010taxreturnforfree Whether you are engaged in a trade or business in the United States depends on the nature of your activities. Filemy2010taxreturnforfree The discussions that follow will help you determine whether you are engaged in a trade or business in the United States. Filemy2010taxreturnforfree Personal Services If you perform personal services in the United States at any time during the tax year, you usually are considered engaged in a trade or business in the United States. Filemy2010taxreturnforfree Certain compensation paid to a nonresident alien by a foreign employer is not included in gross income. Filemy2010taxreturnforfree For more information, see Services Performed for Foreign Employer in chapter 3. Filemy2010taxreturnforfree Other Trade or Business Activities Other examples of being engaged in a trade or business in the United States follow. Filemy2010taxreturnforfree Students and trainees. Filemy2010taxreturnforfree   You are considered engaged in a trade or business in the United States if you are temporarily present in the United States as a nonimmigrant under an “F,” “J,” “M,” or “Q” visa. Filemy2010taxreturnforfree A nonresident alien temporarily present in the United States under a “J” visa includes a nonresident alien individual admitted to the United States as an exchange visitor under the Mutual Educational and Cultural Exchange Act of 1961. Filemy2010taxreturnforfree The taxable part of any scholarship or fellowship grant that is U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree source income is treated as effectively connected with a trade or business in the United States. Filemy2010taxreturnforfree Business operations. Filemy2010taxreturnforfree   If you own and operate a business in the United States selling services, products, or merchandise, you are, with certain exceptions, engaged in a trade or business in the United States. Filemy2010taxreturnforfree Partnerships. Filemy2010taxreturnforfree   If you are a member of a partnership that at any time during the tax year is engaged in a trade or business in the United States, you are considered to be engaged in a trade or business in the United States. Filemy2010taxreturnforfree Beneficiary of an estate or trust. Filemy2010taxreturnforfree   If you are the beneficiary of an estate or trust that is engaged in a trade or business in the United States, you are treated as being engaged in the same trade or business. Filemy2010taxreturnforfree Trading in stocks, securities, and commodities. Filemy2010taxreturnforfree   If your only U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree business activity is trading in stocks, securities, or commodities (including hedging transactions) through a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree resident broker or other agent, you are not engaged in a trade or business in the United States. Filemy2010taxreturnforfree   For transactions in stocks or securities, this applies to any nonresident alien, including a dealer or broker in stocks and securities. Filemy2010taxreturnforfree   For transactions in commodities, this applies to commodities that are usually traded on an organized commodity exchange and to transactions that are usually carried out at such an exchange. Filemy2010taxreturnforfree   This discussion does not apply if you have a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree office or other fixed place of business at any time during the tax year through which, or by the direction of which, you carry out your transactions in stocks, securities, or commodities. Filemy2010taxreturnforfree Trading for a nonresident alien's own account. Filemy2010taxreturnforfree   You are not engaged in a trade or business in the United States if trading for your own account in stocks, securities, or commodities is your only U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree business activity. Filemy2010taxreturnforfree This applies even if the trading takes place while you are present in the United States or is done by your employee or your broker or other agent. Filemy2010taxreturnforfree   This does not apply to trading for your own account if you are a dealer in stocks, securities, or commodities. Filemy2010taxreturnforfree This does not necessarily mean, however, that as a dealer you are considered to be engaged in a trade or business in the United States. Filemy2010taxreturnforfree Determine that based on the facts and circumstances in each case or under the rules given above in Trading in stocks, securities, and commodities . Filemy2010taxreturnforfree Effectively Connected Income If you are engaged in a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree trade or business, all income, gain, or loss for the tax year that you get from sources within the United States (other than certain investment income) is treated as effectively connected income. Filemy2010taxreturnforfree This applies whether or not there is any connection between the income and the trade or business being carried on in the United States during the tax year. Filemy2010taxreturnforfree Two tests, described next under Investment Income, determine whether certain items of investment income (such as interest, dividends, and royalties) are treated as effectively connected with that business. Filemy2010taxreturnforfree In limited circumstances, some kinds of foreign source income may be treated as effectively connected with a trade or business in the United States. Filemy2010taxreturnforfree For a discussion of these rules, see Foreign Income , later. Filemy2010taxreturnforfree Investment Income Investment income from U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree sources that may or may not be treated as effectively connected with a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree trade or business generally falls into the following three categories. Filemy2010taxreturnforfree Fixed or determinable income (interest, dividends, rents, royalties, premiums, annuities, etc. Filemy2010taxreturnforfree ). Filemy2010taxreturnforfree Gains (some of which are considered capital gains) from the sale or exchange of the following types of property. Filemy2010taxreturnforfree Timber, coal, or domestic iron ore with a retained economic interest. Filemy2010taxreturnforfree Patents, copyrights, and similar property on which you receive contingent payments after October 4, 1966. Filemy2010taxreturnforfree Patents transferred before October 5, 1966. Filemy2010taxreturnforfree Original issue discount obligations. Filemy2010taxreturnforfree Capital gains (and losses). Filemy2010taxreturnforfree Use the two tests, described next, to determine whether an item of U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree source income falling in one of the three categories above and received during the tax year is effectively connected with your U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree trade or business. Filemy2010taxreturnforfree If the tests indicate that the item of income is effectively connected, you must include it with your other effectively connected income. Filemy2010taxreturnforfree If the item of income is not effectively connected, include it with all other income discussed under The 30% Tax later, in this chapter. Filemy2010taxreturnforfree Asset-use test. Filemy2010taxreturnforfree   This test usually applies to income that is not directly produced by trade or business activities. Filemy2010taxreturnforfree Under this test, if an item of income is from assets (property) used in, or held for use in, the trade or business in the United States, it is considered effectively connected. Filemy2010taxreturnforfree   An asset is used in, or held for use in, the trade or business in the United States if the asset is: Held for the principal purpose of promoting the conduct of a trade or business in the United States, Acquired and held in the ordinary course of the trade or business conducted in the United States (for example, an account receivable or note receivable arising from that trade or business), or Otherwise held to meet the present needs of the trade or business in the United States and not its anticipated future needs. Filemy2010taxreturnforfree Generally, stock of a corporation is not treated as an asset used in, or held for use in, a trade or business in the United States. Filemy2010taxreturnforfree Business-activities test. Filemy2010taxreturnforfree   This test usually applies when income, gain, or loss comes directly from the active conduct of the trade or business. Filemy2010taxreturnforfree The business-activities test is most important when: Dividends or interest are received by a dealer in stocks or securities, Royalties are received in the trade or business of licensing patents or similar property, or Service fees are earned by a servicing business. Filemy2010taxreturnforfree Under this test, if the conduct of the U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree trade or business was a material factor in producing the income, the income is considered effectively connected. Filemy2010taxreturnforfree Personal Service Income You usually are engaged in a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree trade or business when you perform personal services in the United States. Filemy2010taxreturnforfree Personal service income you receive in a tax year in which you are engaged in a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree trade or business is effectively connected with a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree trade or business. Filemy2010taxreturnforfree Income received in a year other than the year you performed the services is also effectively connected if it would have been effectively connected if received in the year you performed the services. Filemy2010taxreturnforfree Personal service income includes wages, salaries, commissions, fees, per diem allowances, and employee allowances and bonuses. Filemy2010taxreturnforfree The income may be paid to you in the form of cash, services, or property. Filemy2010taxreturnforfree If you are engaged in a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree trade or business only because you perform personal services in the United States during the tax year, income and gains from assets, and gains and losses from the sale or exchange of capital assets are generally not effectively connected with your trade or business. Filemy2010taxreturnforfree However, if there is a direct economic relationship between your holding of the asset and your trade or business of performing personal services, the income, gain, or loss is effectively connected. Filemy2010taxreturnforfree Pensions. Filemy2010taxreturnforfree   If you were a nonresident alien engaged in a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree trade or business after 1986 because you performed personal services in the United States, and you later receive a pension or retirement pay attributable to these services, such payments are effectively connected income in each year you receive them. Filemy2010taxreturnforfree This is true whether or not you are engaged in a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree trade or business in the year you receive the retirement pay. Filemy2010taxreturnforfree Transportation Income Transportation income (defined in chapter 2) is effectively connected if you meet both of the following conditions. Filemy2010taxreturnforfree You had a fixed place of business in the United States involved in earning the income. Filemy2010taxreturnforfree At least 90% of your U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree source transportation income is attributable to regularly scheduled transportation. Filemy2010taxreturnforfree “Fixed place of business” generally means a place, site, structure, or other similar facility through which you engage in a trade or business. Filemy2010taxreturnforfree “Regularly scheduled transportation” means that a ship or aircraft follows a published schedule with repeated sailings or flights at regular intervals between the same points for voyages or flights that begin or end in the United States. Filemy2010taxreturnforfree This definition applies to both scheduled and chartered air transportation. Filemy2010taxreturnforfree If you do not meet the two conditions above, the income is not effectively connected and is taxed at a 4% rate. Filemy2010taxreturnforfree See Transportation Tax, later, in this chapter. Filemy2010taxreturnforfree Business Profits and Losses and Sales Transactions All profits or losses from U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree sources that are from the operation of a business in the United States are effectively connected with a trade or business in the United States. Filemy2010taxreturnforfree For example, profit from the sale in the United States of inventory property purchased either in this country or in a foreign country is effectively connected trade or business income. Filemy2010taxreturnforfree A share of U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree source profits or losses of a partnership that is engaged in a trade or business in the United States is also effectively connected with a trade or business in the United States. Filemy2010taxreturnforfree Real Property Gain or Loss Gains and losses from the sale or exchange of U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree real property interests (whether or not they are capital assets) are taxed as if you are engaged in a trade or business in the United States. Filemy2010taxreturnforfree You must treat the gain or loss as effectively connected with that trade or business. Filemy2010taxreturnforfree U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree real property interest. Filemy2010taxreturnforfree   This is any interest in real property located in the United States or the U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree Virgin Islands or any interest (other than as a creditor) in a domestic corporation that is a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree real property holding corporation. Filemy2010taxreturnforfree Real property includes the following. Filemy2010taxreturnforfree Land and unsevered natural products of the land, such as growing crops and timber, and mines, wells, and other natural deposits. Filemy2010taxreturnforfree Improvements on land, including buildings, other permanent structures, and their structural components. Filemy2010taxreturnforfree Personal property associated with the use of real property, such as equipment used in farming, mining, forestry, or construction or property used in lodging facilities or rented office space, unless the personal property is: Disposed of more than one year before or after the disposition of the real property, or Separately sold to persons unrelated either to the seller or to the buyer of the real property. Filemy2010taxreturnforfree U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree real property holding corporation. Filemy2010taxreturnforfree   A corporation is a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree real property holding corporation if the fair market value of the corporation's U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree real property interests are at least 50% of the total fair market value of: The corporation's U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree real property interests, plus The corporation's interests in real property located outside the United States, plus The corporation's other assets that are used in, or held for use in, a trade or business. Filemy2010taxreturnforfree   Gain or loss on the sale of the stock in any domestic corporation is taxed as if you are engaged in a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree trade or business unless you establish that the corporation is not a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree real property holding corporation. Filemy2010taxreturnforfree   A U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree real property interest does not include a class of stock of a corporation that is regularly traded on an established securities market, unless you hold more than 5% of the fair market value of that class of stock. Filemy2010taxreturnforfree An interest in a foreign corporation owning U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree real property generally is not a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree real property interest unless the corporation chooses to be treated as a domestic corporation. Filemy2010taxreturnforfree Qualified investment entities. Filemy2010taxreturnforfree   Special rules apply to qualified investment entities (QIEs). Filemy2010taxreturnforfree A QIE is any real estate investment trust (REIT) or any regulated investment company (RIC) that is a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree real property holding corporation. Filemy2010taxreturnforfree    Generally, any distribution from a QIE to a shareholder that is attributable to gain from the sale or exchange of a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree real property interest is treated as a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree real property gain by the shareholder receiving the distribution. Filemy2010taxreturnforfree A distribution by a QIE on stock regularly traded on an established securities market in the United States is not treated as gain from the sale or exchange of a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree real property interest if you did not own more than 5% of that stock at any time during the 1-year period ending on the date of the distribution. Filemy2010taxreturnforfree A distribution that you do not treat as gain from the sale or exchange of a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree real property interest is included in your gross income as a regular dividend. Filemy2010taxreturnforfree Note. Filemy2010taxreturnforfree Beginning January 1, 2014 (unless extended by legislation), a RIC that is a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree real property holding corporation will only be treated as a QIE for certain distributions from the RIC that are directly or indirectly attributable to distributions received by the RIC from a REIT. Filemy2010taxreturnforfree Domestically controlled QIE. Filemy2010taxreturnforfree   The sale of an interest in a domestically controlled QIE is not the sale of a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree real property interest. Filemy2010taxreturnforfree The entity is domestically controlled if at all times during the testing period less than 50% in value of its stock was held, directly or indirectly, by foreign persons. Filemy2010taxreturnforfree The testing period is the shorter of (a) the 5-year period ending on the date of disposition, or (b) the period during which the entity was in existence. Filemy2010taxreturnforfree Wash sale. Filemy2010taxreturnforfree    If you dispose of an interest in a domestically controlled QIE in an applicable wash sale transaction, special rules apply. Filemy2010taxreturnforfree An applicable wash sale transaction is one in which you: Dispose of an interest in the domestically controlled QIE during the 30-day period before the ex-dividend date of a distribution that you would (but for the disposition) have treated as gain from the sale or exchange of a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree real property interest, and Acquire, or enter into a contract or option to acquire, a substantially identical interest in that entity during the 61-day period that began on the first day of the 30-day period. Filemy2010taxreturnforfree If this occurs, you are treated as having gain from the sale or exchange of a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree real property interest in an amount equal to the distribution made after June 15, 2006, that would have been treated as such gain. Filemy2010taxreturnforfree This also applies to any substitute dividend payment. Filemy2010taxreturnforfree   A transaction is not treated as an applicable wash sale transaction if: You actually receive the distribution from the domestically controlled QIE related to the interest disposed of, or acquired, in the transaction, or You dispose of any class of stock in a QIE that is regularly traded on an established securities market in the United States but only if you did not own more than 5% of that class of stock at any time during the 1-year period ending on the date of the distribution. Filemy2010taxreturnforfree Alternative minimum tax. Filemy2010taxreturnforfree   There may be a minimum tax on your net gain from the disposition of U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree real property interests. Filemy2010taxreturnforfree Figure the amount of this tax, if any, on Form 6251. Filemy2010taxreturnforfree Withholding of tax. Filemy2010taxreturnforfree   If you dispose of a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree real property interest, the buyer may have to withhold tax. Filemy2010taxreturnforfree See the discussion of Tax Withheld on Real Property Sales in chapter 8. Filemy2010taxreturnforfree Foreign Income You must treat three kinds of foreign source income as effectively connected with a trade or business in the United States if: You have an office or other fixed place of business in the United States to which the income can be attributed, That office or place of business is a material factor in producing the income, and The income is produced in the ordinary course of the trade or business carried on through that office or other fixed place of business. Filemy2010taxreturnforfree An office or other fixed place of business is a material factor if it significantly contributes to, and is an essential economic element in, the earning of the income. Filemy2010taxreturnforfree The three kinds of foreign source income are listed below. Filemy2010taxreturnforfree Rents and royalties for the use of, or for the privilege of using, intangible personal property located outside the United States or from any interest in such property. Filemy2010taxreturnforfree Included are rents or royalties for the use, or for the privilege of using, outside the United States, patents, copyrights, secret processes and formulas, goodwill, trademarks, trade brands, franchises, and similar properties if the rents or royalties are from the active conduct of a trade or business in the United States. Filemy2010taxreturnforfree Dividends, interest, or amounts received for the provision of a guarantee of indebtedness issued after September 27, 2010, from the active conduct of a banking, financing, or similar business in the United States. Filemy2010taxreturnforfree A substitute dividend or interest payment received under a securities lending transaction or a sale-repurchase transaction is treated the same as the amounts received on the transferred security. Filemy2010taxreturnforfree Income, gain, or loss from the sale outside the United States, through the U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree office or other fixed place of business, of: Stock in trade, Property that would be included in inventory if on hand at the end of the tax year, or Property held primarily for sale to customers in the ordinary course of business. Filemy2010taxreturnforfree Item (3) will not apply if you sold the property for use, consumption, or disposition outside the United States and an office or other fixed place of business in a foreign country was a material factor in the sale. Filemy2010taxreturnforfree Any foreign source income that is equivalent to any item of income described above is treated as effectively connected with a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree trade or business. Filemy2010taxreturnforfree For example, foreign source interest and dividend equivalents are treated as U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree effectively connected income if the income is derived by a foreign person in the active conduct of a banking, financing, or similar business within the United States. Filemy2010taxreturnforfree Tax on Effectively Connected Income Income you receive during the tax year that is effectively connected with your trade or business in the United States is, after allowable deductions, taxed at the rates that apply to U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree citizens and residents. Filemy2010taxreturnforfree Generally, you can receive effectively connected income only if you are a nonresident alien engaged in trade or business in the United States during the tax year. Filemy2010taxreturnforfree However, income you receive from the sale or exchange of property, the performance of services, or any other transaction in another tax year is treated as effectively connected in that year if it would have been effectively connected in the year the transaction took place or you performed the services. Filemy2010taxreturnforfree Example. Filemy2010taxreturnforfree Ted Richards, a nonresident alien, entered the United States in August 2012, to perform personal services in the U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree office of his overseas employer. Filemy2010taxreturnforfree He worked in the U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree office until December 25, 2012, but did not leave this country until January 11, 2013. Filemy2010taxreturnforfree On January 8, 2013, he received his final paycheck for services performed in the United States during 2012. Filemy2010taxreturnforfree All of Ted's income during his stay here is U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree source income. Filemy2010taxreturnforfree During 2012, Ted was engaged in the trade or business of performing personal services in the United States. Filemy2010taxreturnforfree Therefore, all amounts paid to him in 2012 for services performed in the United States during 2012 are effectively connected with that trade or business during 2012. Filemy2010taxreturnforfree The salary payment Ted received in January 2013 is U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree source income to him in 2013. Filemy2010taxreturnforfree It is effectively connected with a trade or business in the United States because he was engaged in a trade or business in the United States during 2012 when he performed the services that earned the income. Filemy2010taxreturnforfree Real property income. Filemy2010taxreturnforfree   You may be able to choose to treat all income from real property as effectively connected. Filemy2010taxreturnforfree See Income From Real Property , later, in this chapter. Filemy2010taxreturnforfree The 30% Tax Tax at a 30% (or lower treaty) rate applies to certain items of income or gains from U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree sources but only if the items are not effectively connected with your U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree trade or business. Filemy2010taxreturnforfree Fixed or Determinable Income The 30% (or lower treaty) rate applies to the gross amount of U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree source fixed or determinable annual or periodic gains, profits, or income. Filemy2010taxreturnforfree Income is fixed when it is paid in amounts known ahead of time. Filemy2010taxreturnforfree Income is determinable whenever there is a basis for figuring the amount to be paid. Filemy2010taxreturnforfree Income can be periodic if it is paid from time to time. Filemy2010taxreturnforfree It does not have to be paid annually or at regular intervals. Filemy2010taxreturnforfree Income can be determinable or periodic even if the length of time during which the payments are made is increased or decreased. Filemy2010taxreturnforfree Items specifically included as fixed or determinable income are interest (other than original issue discount), dividends, dividend equivalent payments (defined in chapter 2), rents, premiums, annuities, salaries, wages, and other compensation. Filemy2010taxreturnforfree A substitute dividend or interest payment received under a securities lending transaction or a sale-repurchase transaction is treated the same as the amounts received on the transferred security. Filemy2010taxreturnforfree Other items of income, such as royalties, also may be subject to the 30% tax. Filemy2010taxreturnforfree Some fixed or determinable income may be exempt from U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree tax. Filemy2010taxreturnforfree See chapter 3 if you are not sure whether the income is taxable. Filemy2010taxreturnforfree Original issue discount (OID). Filemy2010taxreturnforfree   If you sold, exchanged, or received a payment on a bond or other debt instrument that was issued at a discount after March 31, 1972, all or part of the original issue discount (OID) (other than portfolio interest) may be subject to the 30% tax. Filemy2010taxreturnforfree The amount of OID is the difference between the stated redemption price at maturity and the issue price of the debt instrument. Filemy2010taxreturnforfree The 30% tax applies in the following circumstances. Filemy2010taxreturnforfree You received a payment on a debt instrument. Filemy2010taxreturnforfree In this case, the amount of OID subject to tax is the OID that accrued while you held the debt instrument minus the OID previously taken into account. Filemy2010taxreturnforfree But the tax on the OID cannot be more than the payment minus the tax on the interest payment on the debt instrument. Filemy2010taxreturnforfree You sold or exchanged the debt instrument. Filemy2010taxreturnforfree The amount of OID subject to tax is the OID that accrued while you held the debt instrument minus the amount already taxed in (1) above. Filemy2010taxreturnforfree   Report on your return the amount of OID shown on Form 1042-S, Foreign Person's U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree Source Income Subject to Withholding, if you bought the debt instrument at original issue. Filemy2010taxreturnforfree However, you must recompute your proper share of OID shown on Form 1042-S if any of the following apply. Filemy2010taxreturnforfree You bought the debt instrument at a premium or paid an acquisition premium. Filemy2010taxreturnforfree The debt instrument is a stripped bond or a stripped coupon (including zero coupon instruments backed by U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree Treasury securities). Filemy2010taxreturnforfree The debt instrument is a contingent payment or inflation-indexed debt instrument. Filemy2010taxreturnforfree For the definition of premium and acquisition premium and instructions on how to recompute OID, get Publication 1212. Filemy2010taxreturnforfree   If you held a bond or other debt instrument that was issued at a discount before April 1, 1972, contact the IRS for further information. Filemy2010taxreturnforfree See chapter 12. Filemy2010taxreturnforfree Gambling Winnings In general, nonresident aliens are subject to the 30% tax on the gross proceeds from gambling won in the United States if that income is not effectively connected with a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree trade or business and is not exempted by treaty. Filemy2010taxreturnforfree However, no tax is imposed on nonbusiness gambling income a nonresident alien wins playing blackjack, baccarat, craps, roulette, or big-6 wheel in the United States. Filemy2010taxreturnforfree Nonresident aliens are taxed at graduated rates on net gambling income won in the United States that is effectively connected with a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree trade or business. Filemy2010taxreturnforfree Social Security Benefits A nonresident alien must include 85% of any U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree social security benefit (and the social security equivalent part of a tier 1 railroad retirement benefit) in U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree source fixed or determinable annual or periodic income. Filemy2010taxreturnforfree Social security benefits include monthly retirement, survivor, and disability benefits. Filemy2010taxreturnforfree This income is exempt under some tax treaties. Filemy2010taxreturnforfree See Table 1 in Publication 901, U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree Tax Treaties, for a list of tax treaties that exempt U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree social security benefits from U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree tax. Filemy2010taxreturnforfree Sales or Exchanges of Capital Assets These rules apply only to those capital gains and losses from sources in the United States that are not effectively connected with a trade or business in the United States. Filemy2010taxreturnforfree They apply even if you are engaged in a trade or business in the United States. Filemy2010taxreturnforfree These rules do not apply to the sale or exchange of a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree real property interest or to the sale of any property that is effectively connected with a trade or business in the United States. Filemy2010taxreturnforfree See Real Property Gain or Loss , earlier, under Effectively Connected Income. Filemy2010taxreturnforfree A capital asset is everything you own except: Inventory. Filemy2010taxreturnforfree Business accounts or notes receivable. Filemy2010taxreturnforfree Depreciable property used in a trade or business. Filemy2010taxreturnforfree Real property used in a trade or business. Filemy2010taxreturnforfree Supplies regularly used in a trade or business. Filemy2010taxreturnforfree Certain copyrights, literary or musical or artistic compositions, letters or memoranda, or similar property. Filemy2010taxreturnforfree Certain U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree government publications. Filemy2010taxreturnforfree Certain commodities derivative financial instruments held by a commodities derivatives dealer. Filemy2010taxreturnforfree Hedging transactions. Filemy2010taxreturnforfree A capital gain is a gain on the sale or exchange of a capital asset. Filemy2010taxreturnforfree A capital loss is a loss on the sale or exchange of a capital asset. Filemy2010taxreturnforfree If the sale is in foreign currency, for the purpose of determining gain, the cost and selling price of the property should be expressed in U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree currency at the rate of exchange prevailing as of the date of the purchase and date of the sale, respectively. Filemy2010taxreturnforfree You may want to read Publication 544. Filemy2010taxreturnforfree However, use Publication 544 only to determine what is a sale or exchange of a capital asset, or what is treated as such. Filemy2010taxreturnforfree Specific tax treatment that applies to U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree citizens or residents generally does not apply to you. Filemy2010taxreturnforfree The following gains are subject to the 30% (or lower treaty) rate without regard to the 183-day rule, discussed later. Filemy2010taxreturnforfree Gains on the disposal of timber, coal, or domestic iron ore with a retained economic interest. Filemy2010taxreturnforfree Gains on contingent payments received from the sale or exchange of patents, copyrights, and similar property after October 4, 1966. Filemy2010taxreturnforfree Gains on certain transfers of all substantial rights to, or an undivided interest in, patents if the transfers were made before October 5, 1966. Filemy2010taxreturnforfree Gains on the sale or exchange of original issue discount obligations. Filemy2010taxreturnforfree Gains in (1) are not subject to the 30% (or lower treaty) rate if you choose to treat the gains as effectively connected with a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree trade or business. Filemy2010taxreturnforfree See Income From Real Property , later. Filemy2010taxreturnforfree 183-day rule. Filemy2010taxreturnforfree   If you were in the United States for 183 days or more during the tax year, your net gain from sales or exchanges of capital assets is taxed at a 30% (or lower treaty) rate. Filemy2010taxreturnforfree For purposes of the 30% (or lower treaty) rate, net gain is the excess of your capital gains from U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree sources over your capital losses from U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree sources. Filemy2010taxreturnforfree This rule applies even if any of the transactions occurred while you were not in the United States. Filemy2010taxreturnforfree   To determine your net gain, consider the amount of your gains and losses that would be recognized and taken into account only if, and to the extent that, they would be recognized and taken into account if you were in a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree trade or business during the year and the gains and losses were effectively connected with that trade or business during the tax year. Filemy2010taxreturnforfree   In arriving at your net gain, do not take the following into consideration. Filemy2010taxreturnforfree The four types of gains listed earlier. Filemy2010taxreturnforfree The deduction for a capital loss carryover. Filemy2010taxreturnforfree Capital losses in excess of capital gains. Filemy2010taxreturnforfree Exclusion for gain from the sale or exchange of qualified small business stock (section 1202 exclusion). Filemy2010taxreturnforfree Losses from the sale or exchange of property held for personal use. Filemy2010taxreturnforfree However, losses resulting from casualties or thefts may be deductible on Schedule A (Form 1040NR). Filemy2010taxreturnforfree See Itemized Deductions in chapter 5. Filemy2010taxreturnforfree   If you are not engaged in a trade or business in the United States and have not established a tax year for a prior period, your tax year will be the calendar year for purposes of the 183-day rule. Filemy2010taxreturnforfree Also, you must file your tax return on a calendar-year basis. Filemy2010taxreturnforfree   If you were in the United States for less than 183 days during the tax year, capital gains (other than gains listed earlier) are tax exempt unless they are effectively connected with a trade or business in the United States during your tax year. Filemy2010taxreturnforfree Reporting. Filemy2010taxreturnforfree   Report your gains and losses from the sales or exchanges of capital assets that are not effectively connected with a trade or business in the United States on page 4 of Form 1040NR. Filemy2010taxreturnforfree Report gains and losses from sales or exchanges of capital assets (including real property) that are effectively connected with a trade or business in the United States on a separate Schedule D (Form 1040), Form 4797, or both. Filemy2010taxreturnforfree Attach them to Form 1040NR. Filemy2010taxreturnforfree Income From Real Property If you have income from real property located in the United States that you own or have an interest in and hold for the production of income, you can choose to treat all income from that property as income effectively connected with a trade or business in the United States. Filemy2010taxreturnforfree The choice applies to all income from real property located in the United States and held for the production of income and to all income from any interest in such property. Filemy2010taxreturnforfree This includes income from rents, royalties from mines, oil or gas wells, or other natural resources. Filemy2010taxreturnforfree It also includes gains from the sale or exchange of timber, coal, or domestic iron ore with a retained economic interest. Filemy2010taxreturnforfree You can make this choice only for real property income that is not otherwise effectively connected with your U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree trade or business. Filemy2010taxreturnforfree If you make the choice, you can claim deductions attributable to the real property income and only your net income from real property is taxed. Filemy2010taxreturnforfree This choice does not treat a nonresident alien, who is not otherwise engaged in a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree trade or business, as being engaged in a trade or business in the United States during the year. Filemy2010taxreturnforfree Example. Filemy2010taxreturnforfree You are a nonresident alien and are not engaged in a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree trade or business. Filemy2010taxreturnforfree You own a single-family house in the United States that you rent out. Filemy2010taxreturnforfree Your rental income for the year is $10,000. Filemy2010taxreturnforfree This is your only U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree source income. Filemy2010taxreturnforfree As discussed earlier under The 30% Tax, the rental income is subject to a tax at a 30% (or lower treaty) rate. Filemy2010taxreturnforfree You received a Form 1042-S showing that your tenants properly withheld this tax from the rental income. Filemy2010taxreturnforfree You do not have to file a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree tax return (Form 1040NR) because your U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree tax liability is satisfied by the withholding of tax. Filemy2010taxreturnforfree If you make the choice discussed earlier, you can offset the $10,000 income by certain rental expenses. Filemy2010taxreturnforfree (See Publication 527, Residential Rental Property, for information on rental expenses. Filemy2010taxreturnforfree ) Any resulting net income is taxed at graduated rates. Filemy2010taxreturnforfree If you make this choice, report the rental income and expenses on Schedule E (Form 1040) and attach the schedule to Form 1040NR. Filemy2010taxreturnforfree For the first year you make the choice, also attach the statement discussed next. Filemy2010taxreturnforfree Making the choice. Filemy2010taxreturnforfree   Make the initial choice by attaching a statement to your return, or amended return, for the year of the choice. Filemy2010taxreturnforfree Include the following in your statement. Filemy2010taxreturnforfree That you are making the choice. Filemy2010taxreturnforfree Whether the choice is under Internal Revenue Code section 871(d) (explained earlier) or a tax treaty. Filemy2010taxreturnforfree A complete list of all your real property, or any interest in real property, located in the United States. Filemy2010taxreturnforfree Give the legal identification of U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree timber, coal, or iron ore in which you have an interest. Filemy2010taxreturnforfree The extent of your ownership in the property. Filemy2010taxreturnforfree The location of the property. Filemy2010taxreturnforfree A description of any major improvements to the property. Filemy2010taxreturnforfree The dates you owned the property. Filemy2010taxreturnforfree Your income from the property. Filemy2010taxreturnforfree Details of any previous choices and revocations of the real property income choice. Filemy2010taxreturnforfree   This choice stays in effect for all later tax years unless you revoke it. Filemy2010taxreturnforfree Revoking the choice. Filemy2010taxreturnforfree   You can revoke the choice without IRS approval by filing Form 1040X, Amended U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree Individual Income Tax Return, for the year you made the choice and for later tax years. Filemy2010taxreturnforfree You must file Form 1040X within 3 years from the date your return was filed or 2 years from the time the tax was paid, whichever is later. Filemy2010taxreturnforfree If this time period has expired for the year of choice, you cannot revoke the choice for that year. Filemy2010taxreturnforfree However, you may revoke the choice for later tax years only if you have IRS approval. Filemy2010taxreturnforfree For information on how to get IRS approval, see Regulation section 1. Filemy2010taxreturnforfree 871-10(d)(2). Filemy2010taxreturnforfree Transportation Tax A 4% tax rate applies to transportation income that is not effectively connected because it does not meet the two conditions listed earlier under Transportation Income . Filemy2010taxreturnforfree If you receive transportation income subject to the 4% tax, you should figure the tax and show it on line 57 of Form 1040NR. Filemy2010taxreturnforfree Attach a statement to your return that includes the following information (if applicable). Filemy2010taxreturnforfree Your name, taxpayer identification number, and tax year. Filemy2010taxreturnforfree A description of the types of services performed (whether on or off board). Filemy2010taxreturnforfree Names of vessels or registration numbers of aircraft on which you performed the services. Filemy2010taxreturnforfree Amount of U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree source transportation income derived from each type of service for each vessel or aircraft for the calendar year. Filemy2010taxreturnforfree Total amount of U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree source transportation income derived from all types of services for the calendar year. Filemy2010taxreturnforfree This 4% tax applies to your U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree source gross transportation income. Filemy2010taxreturnforfree This only includes transportation income that is treated as derived from sources in the United States if the transportation begins or ends in the United States. Filemy2010taxreturnforfree For transportation income from personal services, the transportation must be between the United States and a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree possession. Filemy2010taxreturnforfree For personal services of a nonresident alien, this only applies to income derived from, or in connection with, an aircraft. Filemy2010taxreturnforfree Interrupted Period of Residence You are subject to tax under a special rule if you interrupt your period of U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree residence with a period of nonresidence. Filemy2010taxreturnforfree The special rule applies if you meet all of the following conditions. Filemy2010taxreturnforfree You were a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree resident for a period that includes at least 3 consecutive calendar years. Filemy2010taxreturnforfree You were a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree resident for at least 183 days in each of those years. Filemy2010taxreturnforfree You ceased to be treated as a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree resident. Filemy2010taxreturnforfree You then again became a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree resident before the end of the third calendar year after the end of the period described in (1) above. Filemy2010taxreturnforfree Under this special rule, you are subject to tax on your U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree source gross income and gains on a net basis at the graduated rates applicable to individuals (with allowable deductions) for the period you were a nonresident alien, unless you would be subject to a higher tax under the 30% tax (discussed earlier) on income not connected with a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree trade or business. Filemy2010taxreturnforfree For information on how to figure the special tax, see How To Figure the Expatriation Tax (If You Expatriated Before June 17, 2008) under Expatriation Tax , below. Filemy2010taxreturnforfree Example. Filemy2010taxreturnforfree John Willow, a citizen of New Zealand, entered the United States on April 1, 2008, as a lawful permanent resident. Filemy2010taxreturnforfree On August 1, 2010, John ceased to be a lawful permanent resident and returned to New Zealand. Filemy2010taxreturnforfree During his period of residence, he was present in the United States for at least 183 days in each of three consecutive years (2008, 2009, and 2010). Filemy2010taxreturnforfree He returned to the United States on October 5, 2013, as a lawful permanent resident. Filemy2010taxreturnforfree He became a resident before the close of the third calendar year (2013) beginning after the end of his first period of residence (August 1, 2010). Filemy2010taxreturnforfree Therefore, he is subject to tax under the special rule for the period of nonresidence (August 2, 2010, through October 4, 2013) if it is more than the tax that would normally apply to him as a nonresident alien. Filemy2010taxreturnforfree Reporting requirements. Filemy2010taxreturnforfree   If you are subject to this tax for any year in the period you were a nonresident alien, you must file Form 1040NR for that year. Filemy2010taxreturnforfree The return is due by the due date (including extensions) for filing your U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree income tax return for the year that you again become a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree resident. Filemy2010taxreturnforfree If you already filed returns for that period, you must file amended returns. Filemy2010taxreturnforfree You must attach a statement to your return that identifies the source of all of your U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree and foreign gross income and the items of income subject to this special rule. Filemy2010taxreturnforfree Expatriation Tax The expatriation tax provisions apply to U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree citizens who have renounced their citizenship and long-term residents who have ended their residency. Filemy2010taxreturnforfree The rules that apply are based on the dates of expatriation, which are described in the following sections. Filemy2010taxreturnforfree Expatriation Before June 4, 2004. Filemy2010taxreturnforfree Expatriation After June 3, 2004, and Before June 17, 2008. Filemy2010taxreturnforfree Expatriation After June 16, 2008. Filemy2010taxreturnforfree Long-term resident defined. Filemy2010taxreturnforfree   You are a long-term resident if you were a lawful permanent resident of the United States in at least 8 of the last 15 tax years ending with the year your residency ends. Filemy2010taxreturnforfree In determining if you meet the 8-year requirement, do not count any year that you are treated as a resident of a foreign country under a tax treaty and do not waive treaty benefits. Filemy2010taxreturnforfree Expatriation Before June 4, 2004 If you expatriated before June 4, 2004, the expatriation rules apply if one of the principal purposes of the action is the avoidance of U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree taxes. Filemy2010taxreturnforfree Unless you received a ruling from the IRS that you did not expatriate to avoid U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree taxes, you are presumed to have tax avoidance as a principal purpose if: Your average annual net income tax for the last 5 tax years ending before the date of your action to relinquish your citizenship or terminate your residency was more than $100,000, or Your net worth on the date of your action was $500,000 or more. Filemy2010taxreturnforfree The amounts above are adjusted for inflation if your expatriation action is after 1997 (see Table 4-1). Filemy2010taxreturnforfree Table 4-1. Filemy2010taxreturnforfree Inflation-Adjusted Amounts for Expatriation Actions Before June 4, 2004 IF you expatriated during . Filemy2010taxreturnforfree . Filemy2010taxreturnforfree . Filemy2010taxreturnforfree   THEN the rules outlined on this page apply if . Filemy2010taxreturnforfree . Filemy2010taxreturnforfree . Filemy2010taxreturnforfree     Your 5-year average annual net income tax was more than . Filemy2010taxreturnforfree . Filemy2010taxreturnforfree . Filemy2010taxreturnforfree OR Your net worth equaled or exceeded . Filemy2010taxreturnforfree . Filemy2010taxreturnforfree . Filemy2010taxreturnforfree 1999   110,000   552,000 2000   112,000   562,000 2001   116,000   580,000 2002   120,000   599,000 2003   122,000   608,000 2004 (before June 4)*   124,000   622,000 *If you expatriated after June 3, 2004, see Expatriation After June 3, 2004, and Before June 17, 2008 or Expatriation After June 16, 2008. Filemy2010taxreturnforfree Reporting requirements. Filemy2010taxreturnforfree   If you lost your U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree citizenship, you should have filed Form 8854 with a consular office or a federal court at the time of loss of citizenship. Filemy2010taxreturnforfree If you ended your long-term residency, you should have filed Form 8854 with the Internal Revenue Service when you filed your dual-status tax return for the year your residency ended. Filemy2010taxreturnforfree   Your U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree residency is considered to have ended when you ceased to be a lawful permanent resident or you began to be treated as a resident of another country under a tax treaty and do not waive treaty benefits. Filemy2010taxreturnforfree Penalties. Filemy2010taxreturnforfree   If you failed to file Form 8854, you may have to pay a penalty equal to the greater of 5% of the expatriation tax or $1,000. Filemy2010taxreturnforfree The penalty will be assessed for each year of the 10-year period beginning on the date of expatriation during which your failure to file continues. Filemy2010taxreturnforfree The penalty will not be imposed if you can show that the failure is due to reasonable cause and not willful neglect. Filemy2010taxreturnforfree Expatriation tax. Filemy2010taxreturnforfree   The expatriation tax applies to the 10-year period following the date of expatriation or termination of residency. Filemy2010taxreturnforfree It is figured in the same way as for those expatriating after June 3, 2004, and before June 17, 2008. Filemy2010taxreturnforfree See How To Figure the Expatriation Tax (If You Expatriated Before June 17, 2008) in the next section. Filemy2010taxreturnforfree Expatriation After June 3, 2004, and Before June 17, 2008 If you expatriated after June 3, 2004, and before June 17, 2008, the expatriation rules apply to you if any of the following statements apply. Filemy2010taxreturnforfree Your average annual net income tax for the 5 tax years ending before the date of expatriation or termination of residency is more than: $124,000 if you expatriated or terminated residency in 2004. Filemy2010taxreturnforfree $127,000 if you expatriated or terminated residency in 2005. Filemy2010taxreturnforfree $131,000 if you expatriated or terminated residency in 2006. Filemy2010taxreturnforfree $136,000 if you expatriated or terminated residency in 2007. Filemy2010taxreturnforfree $139,000 if you expatriated or terminated residency in 2008. Filemy2010taxreturnforfree Your net worth is $2 million or more on the date of your expatriation or termination of residency. Filemy2010taxreturnforfree You fail to certify on Form 8854 that you have complied with all U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree federal tax obligations for the 5 tax years preceding the date of your expatriation or termination of residency. Filemy2010taxreturnforfree Exception for dual-citizens and certain minors. Filemy2010taxreturnforfree   Certain dual-citizens and certain minors (defined next) are not subject to the expatriation tax even if they meet (1) or (2) earlier. Filemy2010taxreturnforfree However, they still must provide the certification required in (3). Filemy2010taxreturnforfree Certain dual-citizens. Filemy2010taxreturnforfree   You may qualify for the exception described above if all of the following apply. Filemy2010taxreturnforfree You became at birth a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree citizen and a citizen of another country and you continue to be a citizen of that other country. Filemy2010taxreturnforfree You were never a resident alien of the United States (as defined in chapter 1). Filemy2010taxreturnforfree You never held a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree passport. Filemy2010taxreturnforfree You were present in the United States for no more than 30 days during any calendar year that is 1 of the 10 calendar years preceding your loss of U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree citizenship. Filemy2010taxreturnforfree Certain minors. Filemy2010taxreturnforfree   You may qualify for the exception described above if you meet all of the following requirements. Filemy2010taxreturnforfree You became a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree citizen at birth. Filemy2010taxreturnforfree Neither of your parents was a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree citizen at the time of your birth. Filemy2010taxreturnforfree You expatriated before you were 18½. Filemy2010taxreturnforfree You were present in the United States for not more than 30 days during any calendar year that is 1 of the 10 calendar years preceding your expatriation. Filemy2010taxreturnforfree Tax consequences of presence in the United States. Filemy2010taxreturnforfree   The following rules apply if you do not meet the exception above for dual-citizens and certain minors and the expatriation rules would otherwise apply to you. Filemy2010taxreturnforfree   The expatriation tax does not apply to any tax year during the 10-year period if you are physically present in the United States for more than 30 days during the calendar year ending in that year. Filemy2010taxreturnforfree Instead, you are treated as a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree citizen or resident and taxed on your worldwide income for that tax year. Filemy2010taxreturnforfree You must file Form 1040, 1040A, or 1040EZ and figure your tax as prescribed in the instructions for those forms. Filemy2010taxreturnforfree   When counting the number of days of presence during a calendar year, count any day you were physically present in the United States at any time during the day. Filemy2010taxreturnforfree However, do not count any days (up to a limit of 30 days) on which you performed personal services in the United States for an employer who is not related to you if either of the following apply. Filemy2010taxreturnforfree You have ties with other countries. Filemy2010taxreturnforfree You have ties with other countries if: You became (within a reasonable period after your expatriation or termination of residency) a citizen or resident of the country in which you, your spouse, or either of your parents were born, and You became fully liable for income tax in that country. Filemy2010taxreturnforfree You were physically present in the United States for 30 days or less during each year in the 10-year period ending on the date of expatriation or termination of residency. Filemy2010taxreturnforfree Do not count any day you were an exempt individual or were unable to leave the United States because of a medical condition that arose while you were in the United States. Filemy2010taxreturnforfree See Exempt individual and Medical condition in chapter 1 under Substantial Presence Test, but disregard the information about Form 8843. Filemy2010taxreturnforfree Related employer. Filemy2010taxreturnforfree   If your employer in the United States is any of the following, then your employer is related to you. Filemy2010taxreturnforfree You must count any days you performed services in the United States for that employer as days of presence in the United States. Filemy2010taxreturnforfree Members of your family. Filemy2010taxreturnforfree This includes only your brothers and sisters, half-brothers and half-sisters, spouse, ancestors (parents, grandparents, etc. Filemy2010taxreturnforfree ), and lineal descendants (children, grandchildren, etc. Filemy2010taxreturnforfree ). Filemy2010taxreturnforfree A partnership in which you directly or indirectly own more than 50% of the capital interest or the profits interest. Filemy2010taxreturnforfree A corporation in which you directly or indirectly own more than 50% in value of the outstanding stock. Filemy2010taxreturnforfree (See Publication 550, chapter 4, Constructive ownership of stock, for how to determine whether you directly or indirectly own outstanding stock. Filemy2010taxreturnforfree ) A tax-exempt charitable or educational organization that is directly or indirectly controlled, in any manner or by any method, by you or by a member of your family, whether or not this control is legally enforceable. Filemy2010taxreturnforfree Date of tax expatriation. Filemy2010taxreturnforfree   For purposes of U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree tax rules, the date of your expatriation or termination of residency is the later of the dates on which you perform the following actions. Filemy2010taxreturnforfree You notify either the Department of State or the Department of Homeland Security (whichever is appropriate) of your expatriating act or termination of residency. Filemy2010taxreturnforfree You file Form 8854 in accordance with the form instructions. Filemy2010taxreturnforfree Annual return. Filemy2010taxreturnforfree   If the expatriation tax applies to you, you must file Form 8854 each year during the 10-year period following the date of expatriation. Filemy2010taxreturnforfree You must file this form even if you owe no U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree tax. Filemy2010taxreturnforfree Penalty. Filemy2010taxreturnforfree   If you fail to file Form 8854 for any tax year, fail to include all information required to be shown on the form, or include incorrect information, you may have to pay a penalty of $10,000. Filemy2010taxreturnforfree You will not have to pay a penalty if you show that the failure is due to reasonable cause and not to willful neglect. Filemy2010taxreturnforfree How To Figure the Expatriation Tax (If You Expatriated Before June 17, 2008) If the expatriation tax applies to you, you are generally subject to tax on your U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree source gross income and gains on a net basis at the graduated rates applicable to individuals (with allowable deductions) unless you would be subject to a higher tax under the 30% tax (discussed earlier) on income not connected with a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree trade or business. Filemy2010taxreturnforfree For this purpose, U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree source gross income (defined in chapter 2) includes gains from the sale or exchange of: Property (other than stock or debt obligations) located in the United States, Stock issued by a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree domestic corporation, and Debt obligations of U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree persons or of the United States, a state or political subdivision thereof, or the District of Columbia. Filemy2010taxreturnforfree U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree source income also includes any income or gain derived from stock in certain controlled foreign corporations if you owned, or were considered to own, at any time during the 2-year period ending on the date of expatriation, more than 50% of: The total combined voting power of all classes of that corporation's stock, or The total value of the stock. Filemy2010taxreturnforfree The income or gain is considered U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree source income only to the extent of your share of earnings and profits earned or accumulated before the date of expatriation and during the periods you met the ownership requirements discussed above. Filemy2010taxreturnforfree Any exchange of property is treated as a sale of the property at its fair market value on the date of the exchange and any gain is treated as U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree source gross income in the tax year of the exchange unless you enter into a gain recognition agreement under Notice 97-19. Filemy2010taxreturnforfree Other information. Filemy2010taxreturnforfree   For more information on the expatriation tax provisions, including exceptions to the tax and special U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree source rules, see section 877 of the Internal Revenue Code. Filemy2010taxreturnforfree Expatriation Tax Return If you expatriated or terminated your U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree residency, or you are subject to the expatriation tax, you must file Form 8854, Initial and Annual Expatriation Statement. Filemy2010taxreturnforfree Attach it to Form 1040NR if you are required to file that form. Filemy2010taxreturnforfree If you are present in the United States following your expatriation and are subject to tax as a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree citizen or resident, file Form 8854 with Form 1040. Filemy2010taxreturnforfree Expatriation After June 16, 2008 If you expatriated after June 16, 2008, the expatriation rules apply to you if you meet any of the following conditions. Filemy2010taxreturnforfree Your average annual net income tax for the 5 years ending before the date of expatriation or termination of residency is more than: $139,000 if you expatriated or terminated residency in 2008. Filemy2010taxreturnforfree $145,000 if you expatriated or terminated residency in 2009 or 2010. Filemy2010taxreturnforfree $147,000 if you expatriated or terminated residency in 2011. Filemy2010taxreturnforfree $151,000 if you expatriated or terminated residency in 2012. Filemy2010taxreturnforfree $155,000 if you expatriated or terminated residency in 2013. Filemy2010taxreturnforfree Your net worth is $2 million or more on the date of your expatriation or termination of residency. Filemy2010taxreturnforfree You fail to certify on Form 8854 that you have complied with all U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree federal tax obligations for the 5 years preceding the date of your expatriation or termination of residency. Filemy2010taxreturnforfree Exception for dual-citizens and certain minors. Filemy2010taxreturnforfree   Certain dual-citizens and certain minors (defined next) are not subject to the expatriation tax even if they meet (1) or (2) above. Filemy2010taxreturnforfree However, they still must provide the certification required in (3) above. Filemy2010taxreturnforfree Certain dual-citizens. Filemy2010taxreturnforfree   You may qualify for the exception described above if both of the following apply. Filemy2010taxreturnforfree You became at birth a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree citizen and a citizen of another country and you continue to be a citizen of, and are taxed as a resident of, that other country. Filemy2010taxreturnforfree You have been a resident of the United States for not more than 10 years during the 15-year tax period ending with the tax year during which the expatriation occurs. Filemy2010taxreturnforfree For the purpose of determining U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree residency, use the substantial presence test described in chapter 1. Filemy2010taxreturnforfree Certain minors. Filemy2010taxreturnforfree   You may qualify for the exception described earlier if you meet both of the following requirements. Filemy2010taxreturnforfree You expatriated before you were 18½. Filemy2010taxreturnforfree You have been a resident of the United States for not more than 10 tax years before the expatriation occurs. Filemy2010taxreturnforfree For the purpose of determining U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree residency, use the substantial presence test described in chapter 1. Filemy2010taxreturnforfree Expatriation date. Filemy2010taxreturnforfree   Your expatriation date is the date you relinquish U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree citizenship (in the case of a former citizen) or terminate your long-term residency (in the case of a former U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree resident). Filemy2010taxreturnforfree Former U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree citizen. Filemy2010taxreturnforfree   You are considered to have relinquished your U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree citizenship on the earliest of the following dates. Filemy2010taxreturnforfree The date you renounced U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree citizenship before a diplomatic or consular officer of the United States (provided that the voluntary renouncement was later confirmed by the issuance of a certificate of loss of nationality). Filemy2010taxreturnforfree The date you furnished to the State Department a signed statement of voluntary relinquishment of U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree nationality confirming the performance of an expatriating act (provided that the voluntary relinquishment was later confirmed by the issuance of a certificate of loss of nationality). Filemy2010taxreturnforfree The date the State Department issued a certificate of loss of nationality. Filemy2010taxreturnforfree The date that a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree court canceled your certificate of naturalization. Filemy2010taxreturnforfree Former long-term resident. Filemy2010taxreturnforfree   You are considered to have terminated your long-term residency on the earliest of the following dates. Filemy2010taxreturnforfree The date you voluntarily relinquished your lawful permanent resident status by filing Department of Homeland Security Form I-407 with a U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree consular or immigration officer, and the Department of Homeland Security determined that you have, in fact, abandoned your lawful permanent resident status. Filemy2010taxreturnforfree The date you became subject to a final administrative order for your removal from the United States under the Immigration and Nationality Act and you actually left the United States as a result of that order. Filemy2010taxreturnforfree If you were a dual resident of the United States and a country with which the United States has an income tax treaty, the date you began to be treated as a resident of that country and you determined that, for purposes of the treaty, you are a resident of the treaty country and notify the IRS of that treatment on Forms 8833 and 8854. Filemy2010taxreturnforfree See Effect of Tax Treaties in chapter 1 for more information about dual residents. Filemy2010taxreturnforfree How To Figure the Expatriation Tax (If You Expatriate After June 16, 2008) In the year you expatriate, you are subject to income tax on the net unrealized gain (or loss) in your property as if the property had been sold for its fair market value on the day before your expatriation date (“mark-to-market tax”). Filemy2010taxreturnforfree This applies to most types of property interests you held on the date of relinquishment of citizenship or termination of residency. Filemy2010taxreturnforfree But see Exceptions , later. Filemy2010taxreturnforfree Gains arising from deemed sales must be taken into account for the tax year of the deemed sale without regard to other U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree internal revenue laws. Filemy2010taxreturnforfree Losses from deemed sales must be taken into account to the extent otherwise provided under U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree internal revenue laws. Filemy2010taxreturnforfree However, Internal Revenue Code section 1091 (relating to the disallowance of losses on wash sales of stock and securities) does not apply. Filemy2010taxreturnforfree The net gain that you otherwise must include in your income is reduced (but not below zero) by: $600,000 if you expatriated or terminated residency before January 1, 2009. Filemy2010taxreturnforfree $626,000 if you expatriated or terminated residency in 2009. Filemy2010taxreturnforfree $627,000 if you expatriated or terminated residency in 2010. Filemy2010taxreturnforfree $636,000 if you expatriated or terminated residency in 2011. Filemy2010taxreturnforfree $651,000 if you expatriated or terminated residency in 2012. Filemy2010taxreturnforfree $668,000 if you expatriated or terminated residency in 2013. Filemy2010taxreturnforfree Exceptions. Filemy2010taxreturnforfree   The mark-to-market tax does not apply to the following. Filemy2010taxreturnforfree Eligible deferred compensation items. Filemy2010taxreturnforfree Ineligible deferred compensation items. Filemy2010taxreturnforfree Interests in nongrantor trusts. Filemy2010taxreturnforfree Specified tax deferred accounts. Filemy2010taxreturnforfree Instead, items (1) and (3) may be subject to withholding at source. Filemy2010taxreturnforfree In the case of item (2), you are treated as receiving the present value of your accrued benefit as of the day before the expatriation date. Filemy2010taxreturnforfree In the case of item (4), you are treated as receiving a distribution of your entire interest in the account on the day before your expatriation date. Filemy2010taxreturnforfree See paragraphs (d), (e), and (f) of section 877A for more information. Filemy2010taxreturnforfree Expatriation Tax Return If you expatriated or terminated your U. Filemy2010taxreturnforfree S. Filemy2010taxreturnforfree residency, or you are subject to the expatriation rules (as discussed earlier in the first paragraph under Expatriation After June 16, 2008), you must file Form 8854. Filemy2010taxreturnforfree Attach it to Form 1040 or Form 1040NR if you are required to file either of those forms. Filemy2010taxreturnforfree Deferral of payment of mark-to-market tax. Filemy2010taxreturnforfree   You can make an irrevocable election to defer payment of the mark-to-market tax imposed on the deemed sale of property. Filemy2010taxreturnforfree If you make this election, the following rules apply. Filemy2010taxreturnforfree You can make the election on a property-by-property basis. Filemy2010taxreturnforfree The deferred tax attributable to a particular property is due on the return for the tax year in which you dispose of the property. Filemy2010taxreturnforfree Interest is charged for the period the tax is deferred. Filemy2010taxreturnforfree The due date for the payment of the deferred tax cannot be extended beyond the earlier of the following dates. Filemy2010taxreturnforfree The due date of the return required for the year of death. Filemy2010taxreturnforfree The time that the security provided for the property fails to be adequate. Filemy2010taxreturnforfree See item (6) below. Filemy2010taxreturnforfree You make the election on Form 8854. Filemy2010taxreturnforfree You must provide adequate security (such as a bond). Filemy2010taxreturnforfree You must make an irrevocable waiver of any right under any treaty of the United States which would preclude assessment or collection of the mark-to-market tax. Filemy2010taxreturnforfree   For more information about the deferral of payment, see the Instructions for Form 8854. Filemy2010taxreturnforfree Prev  Up  Next   Home   More Online Publications