Filing Your Taxes Online is Fast, Easy and Secure.
Start now and receive your tax refund in as little as 7 days.

1. Get Answers

Your online questions are customized to your unique tax situation.

2. Maximize your Refund

Find tax credits for everything from school tuition to buying a hybri

3. E-File for FREE

E-file free with direct deposit to get your refund in as few as 7 days.

Filing your taxes with paper mail can be difficult and it could take weeks for your refund to arrive. IRS e-file is easy, fast and secure. There is no paperwork going to the IRS so tax refunds can be processed in as little as 7 days with direct deposit. As you prepare your taxes online, you can see your tax refund in real time.

FREE audit support and representation from an enrolled agent – NEW and only from H&R Block

Free E File 2011

File Taxes For FreeAmend Tax Return For FreeFree Tax Calculator 2011How To File Taxes For 20121040 AmendmentFederal Tax Amendment2009 Amended Tax Return InstructionsAmending Tax ReturnsFile Amended Tax Return 2011File Taxes For 2012 FreeFile Just State Taxes Online FreePa Ez Form1040x Amended Return 2012Online Tax FilingWhere Can I File 2012 Taxes OnlineAmended Tax Return InstructionsWhere To File 2009 Tax ReturnIrs 2012 Tax FormCan I Efile 1040nrFree State Income Tax Forms Online1090ezTax Forms 1040ezFree Tax Estimator 2011Www Hnr Block ComIrs Forms 1040Hrblockfree ComSelf Employed Tax Return1040ez Online FreeTax Act Online 2012 LoginFiling 1040ez540ezTax Forms 1040ezFree Fillable State Tax FormsCan I Still File My 2011 State TaxesIrs Gov 1040ezFile 2012 Taxes Online For FreeHrblock Free Tax ReturnWww Irs Gov Form 1040ezFreetax ComHow To Amend A Tax Return 2013

Free E File 2011

Free e file 2011 Publication 15-B - Main Content Table of Contents 1. Free e file 2011 Fringe Benefit OverviewAre Fringe Benefits Taxable? Cafeteria Plans Simple Cafeteria Plans 2. Free e file 2011 Fringe Benefit Exclusion RulesAccident and Health Benefits Achievement Awards Adoption Assistance Athletic Facilities De Minimis (Minimal) Benefits Dependent Care Assistance Educational Assistance Employee Discounts Employee Stock Options Employer-Provided Cell Phones Group-Term Life Insurance Coverage Health Savings Accounts Lodging on Your Business Premises Meals Moving Expense Reimbursements No-Additional-Cost Services Retirement Planning Services Transportation (Commuting) Benefits Tuition Reduction Working Condition Benefits 3. Free e file 2011 Fringe Benefit Valuation RulesGeneral Valuation Rule Cents-Per-Mile Rule Commuting Rule Lease Value Rule Unsafe Conditions Commuting Rule 4. Free e file 2011 Rules for Withholding, Depositing, and ReportingTransfer of property. Free e file 2011 Amount of deposit. Free e file 2011 Limitation. Free e file 2011 Conformity rules. Free e file 2011 Election not to withhold income tax. Free e file 2011 How To Get Tax Help 1. Free e file 2011 Fringe Benefit Overview A fringe benefit is a form of pay for the performance of services. Free e file 2011 For example, you provide an employee with a fringe benefit when you allow the employee to use a business vehicle to commute to and from work. Free e file 2011 Performance of services. Free e file 2011   A person who performs services for you does not have to be your employee. Free e file 2011 A person may perform services for you as an independent contractor, partner, or director. Free e file 2011 Also, for fringe benefit purposes, treat a person who agrees not to perform services (such as under a covenant not to compete) as performing services. Free e file 2011 Provider of benefit. Free e file 2011   You are the provider of a fringe benefit if it is provided for services performed for you. Free e file 2011 You are considered the provider of a fringe benefit even if a third party, such as your client or customer, provides the benefit to your employee for services the employee performs for you. Free e file 2011 For example, if, in exchange for goods or services, your customer provides day care services as a fringe benefit to your employees for services they provide for you as their employer, then you are the provider of this fringe benefit even though the customer is actually providing the day care. Free e file 2011 Recipient of benefit. Free e file 2011   The person who performs services for you is considered the recipient of a fringe benefit provided for those services. Free e file 2011 That person may be considered the recipient even if the benefit is provided to someone who did not perform services for you. Free e file 2011 For example, your employee may be the recipient of a fringe benefit you provide to a member of the employee's family. Free e file 2011 Are Fringe Benefits Taxable? Any fringe benefit you provide is taxable and must be included in the recipient's pay unless the law specifically excludes it. Free e file 2011 Section 2 discusses the exclusions that apply to certain fringe benefits. Free e file 2011 Any benefit not excluded under the rules discussed in section 2 is taxable. Free e file 2011 Including taxable benefits in pay. Free e file 2011   You must include in a recipient's pay the amount by which the value of a fringe benefit is more than the sum of the following amounts. Free e file 2011 Any amount the law excludes from pay. Free e file 2011 Any amount the recipient paid for the benefit. Free e file 2011 The rules used to determine the value of a fringe benefit are discussed in section 3. Free e file 2011   If the recipient of a taxable fringe benefit is your employee, the benefit is subject to employment taxes and must be reported on Form W-2, Wage and Tax Statement. Free e file 2011 However, you can use special rules to withhold, deposit, and report the employment taxes. Free e file 2011 These rules are discussed in section 4. Free e file 2011   If the recipient of a taxable fringe benefit is not your employee, the benefit is not subject to employment taxes. Free e file 2011 However, you may have to report the benefit on one of the following information returns. Free e file 2011 If the recipient receives the benefit as: Use: An independent contractor Form 1099-MISC, Miscellaneous Income A partner Schedule K-1 (Form 1065), Partner's Share of Income, Deductions, Credits, etc. Free e file 2011 For more information, see the instructions for the forms listed above. Free e file 2011 Cafeteria Plans A cafeteria plan, including a flexible spending arrangement, is a written plan that allows your employees to choose between receiving cash or taxable benefits instead of certain qualified benefits for which the law provides an exclusion from wages. Free e file 2011 If an employee chooses to receive a qualified benefit under the plan, the fact that the employee could have received cash or a taxable benefit instead will not make the qualified benefit taxable. Free e file 2011 Generally, a cafeteria plan does not include any plan that offers a benefit that defers pay. Free e file 2011 However, a cafeteria plan can include a qualified 401(k) plan as a benefit. Free e file 2011 Also, certain life insurance plans maintained by educational institutions can be offered as a benefit even though they defer pay. Free e file 2011 Qualified benefits. Free e file 2011   A cafeteria plan can include the following benefits discussed in section 2. Free e file 2011 Accident and health benefits (but not Archer medical savings accounts (Archer MSAs) or long-term care insurance). Free e file 2011 Adoption assistance. Free e file 2011 Dependent care assistance. Free e file 2011 Group-term life insurance coverage (including costs that cannot be excluded from wages). Free e file 2011 Health savings accounts (HSAs). Free e file 2011 Distributions from an HSA may be used to pay eligible long-term care insurance premiums or qualified long-term care services. Free e file 2011 Benefits not allowed. Free e file 2011   A cafeteria plan cannot include the following benefits discussed in section 2. Free e file 2011 Archer MSAs. Free e file 2011 See Accident and Health Benefits in section 2. Free e file 2011 Athletic facilities. Free e file 2011 De minimis (minimal) benefits. Free e file 2011 Educational assistance. Free e file 2011 Employee discounts. Free e file 2011 Employer-provided cell phones. Free e file 2011 Lodging on your business premises. Free e file 2011 Meals. Free e file 2011 Moving expense reimbursements. Free e file 2011 No-additional-cost services. Free e file 2011 Transportation (commuting) benefits. Free e file 2011 Tuition reduction. Free e file 2011 Working condition benefits. Free e file 2011 It also cannot include scholarships or fellowships (discussed in Publication 970, Tax Benefits for Education). Free e file 2011 $2,500 limit on a health flexible spending arrangement (FSA). Free e file 2011   For plan years beginning after December 31, 2012, a cafeteria plan may not allow an employee to request salary reduction contributions for a health FSA in excess of $2,500. Free e file 2011 For plan years beginning after December 31, 2013, the limit is unchanged at $2,500. Free e file 2011   A cafeteria plan offering a health FSA must be amended to specify the $2,500 limit (or any lower limit set by the employer). Free e file 2011 While cafeteria plans generally must be amended on a prospective basis, an amendment that is adopted on or before December 31, 2014, may be made effective retroactively, provided that in operation the cafeteria plan meets the limit for plan years beginning after December 31, 2012. Free e file 2011 A cafeteria plan that does not limit health FSA contributions to the dollar limit is not a cafeteria plan and all benefits offered under the plan are includible in the employee's gross income. Free e file 2011   For more information, see Notice 2012-40, 2012-26 I. Free e file 2011 R. Free e file 2011 B. Free e file 2011 1046, available at www. Free e file 2011 irs. Free e file 2011 gov/irb/2012-26_IRB/ar09. Free e file 2011 html. Free e file 2011 Employee. Free e file 2011   For these plans, treat the following individuals as employees. Free e file 2011 A current common-law employee. Free e file 2011 See section 2 in Publication 15 (Circular E) for more information. Free e file 2011 A full-time life insurance agent who is a current statutory employee. Free e file 2011 A leased employee who has provided services to you on a substantially full-time basis for at least a year if the services are performed under your primary direction or control. Free e file 2011 Exception for S corporation shareholders. Free e file 2011   Do not treat a 2% shareholder of an S corporation as an employee of the corporation for this purpose. Free e file 2011 A 2% shareholder for this purpose is someone who directly or indirectly owns (at any time during the year) more than 2% of the corporation's stock or stock with more than 2% of the voting power. Free e file 2011 Treat a 2% shareholder as you would a partner in a partnership for fringe benefit purposes, but do not treat the benefit as a reduction in distributions to the 2% shareholder. Free e file 2011 Plans that favor highly compensated employees. Free e file 2011   If your plan favors highly compensated employees as to eligibility to participate, contributions, or benefits, you must include in their wages the value of taxable benefits they could have selected. Free e file 2011 A plan you maintain under a collective bargaining agreement does not favor highly compensated employees. Free e file 2011   A highly compensated employee for this purpose is any of the following employees. Free e file 2011 An officer. Free e file 2011 A shareholder who owns more than 5% of the voting power or value of all classes of the employer's stock. Free e file 2011 An employee who is highly compensated based on the facts and circumstances. Free e file 2011 A spouse or dependent of a person described in (1), (2), or (3). Free e file 2011 Plans that favor key employees. Free e file 2011   If your plan favors key employees, you must include in their wages the value of taxable benefits they could have selected. Free e file 2011 A plan favors key employees if more than 25% of the total of the nontaxable benefits you provide for all employees under the plan go to key employees. Free e file 2011 However, a plan you maintain under a collective bargaining agreement does not favor key employees. Free e file 2011   A key employee during 2014 is generally an employee who is either of the following. Free e file 2011 An officer having annual pay of more than $170,000. Free e file 2011 An employee who for 2014 is either of the following. Free e file 2011 A 5% owner of your business. Free e file 2011 A 1% owner of your business whose annual pay was more than $150,000. Free e file 2011 Simple Cafeteria Plans Eligible employers meeting contribution requirements and eligibility and participation requirements can establish a simple cafeteria plan. Free e file 2011 Simple cafeteria plans are treated as meeting the nondiscrimination requirements of a cafeteria plan and certain benefits under a cafeteria plan. Free e file 2011 Eligible employer. Free e file 2011   You are an eligible employer if you employ an average of 100 or fewer employees during either of the 2 preceding years. Free e file 2011 If your business was not in existence throughout the preceding year, you are eligible if you reasonably expect to employ an average of 100 or fewer employees in the current year. Free e file 2011 If you establish a simple cafeteria plan in a year that you employ an average of 100 or fewer employees, you are considered an eligible employer for any subsequent year as long as you do not employ an average of 200 or more employees in a subsequent year. Free e file 2011 Eligibility and participation requirements. Free e file 2011   These requirements are met if all employees who had at least 1,000 hours of service for the preceding plan year are eligible to participate and each employee eligible to participate in the plan may elect any benefit available under the plan. Free e file 2011 You may elect to exclude from the plan employees who: Are under age 21 before the close of the plan year, Have less than 1 year of service with you as of any day during the plan year, Are covered under a collective bargaining agreement, or Are nonresident aliens working outside the United States whose income did not come from a U. Free e file 2011 S. Free e file 2011 source. Free e file 2011 Contribution requirements. Free e file 2011   You must make a contribution to provide qualified benefits on behalf of each qualified employee in an amount equal to: A uniform percentage (not less than 2%) of the employee’s compensation for the plan year, or An amount which is at least 6% of the employee’s compensation for the plan year or twice the amount of the salary reduction contributions of each qualified employee, whichever is less. Free e file 2011 If the contribution requirements are met using option (2), the rate of contribution to any salary reduction contribution of a highly compensated or key employee can not be greater than the rate of contribution to any other employee. Free e file 2011 More information. Free e file 2011   For more information about cafeteria plans, see section 125 of the Internal Revenue Code and its regulations. Free e file 2011 2. Free e file 2011 Fringe Benefit Exclusion Rules This section discusses the exclusion rules that apply to fringe benefits. Free e file 2011 These rules exclude all or part of the value of certain benefits from the recipient's pay. Free e file 2011 The excluded benefits are not subject to federal income tax withholding. Free e file 2011 Also, in most cases, they are not subject to social security, Medicare, or federal unemployment (FUTA) tax and are not reported on Form W-2. Free e file 2011 This section discusses the exclusion rules for the following fringe benefits. Free e file 2011 Accident and health benefits. Free e file 2011 Achievement awards. Free e file 2011 Adoption assistance. Free e file 2011 Athletic facilities. Free e file 2011 De minimis (minimal) benefits. Free e file 2011 Dependent care assistance. Free e file 2011 Educational assistance. Free e file 2011 Employee discounts. Free e file 2011 Employee stock options. Free e file 2011 Employer-provided cell phones. Free e file 2011 Group-term life insurance coverage. Free e file 2011 Health savings accounts (HSAs). Free e file 2011 Lodging on your business premises. Free e file 2011 Meals. Free e file 2011 Moving expense reimbursements. Free e file 2011 No-additional-cost services. Free e file 2011 Retirement planning services. Free e file 2011 Transportation (commuting) benefits. Free e file 2011 Tuition reduction. Free e file 2011 Working condition benefits. Free e file 2011 See Table 2-1, later, for an overview of the employment tax treatment of these benefits. Free e file 2011 Table 2-1. Free e file 2011 Special Rules for Various Types of Fringe Benefits (For more information, see the full discussion in this section. Free e file 2011 ) Treatment Under Employment Taxes Type of Fringe Benefit Income Tax Withholding Social Security and Medicare (including Additional Medicare Tax when wages are paid in excess of $200,000) Federal Unemployment (FUTA) Accident and health benefits Exempt1,2, except for long-term care benefits provided through a flexible spending or similar arrangement. Free e file 2011 Exempt, except for certain payments to S corporation employees who are 2% shareholders. Free e file 2011 Exempt Achievement awards Exempt1 up to $1,600 for qualified plan awards ($400 for nonqualified awards). Free e file 2011 Adoption assistance Exempt1,3 Taxable Taxable Athletic facilities Exempt if substantially all use during the calendar year is by employees, their spouses, and their dependent children and the facility is operated by the employer on premises owned or leased by the employer. Free e file 2011 De minimis (minimal) benefits Exempt Exempt Exempt Dependent care assistance Exempt3 up to certain limits, $5,000 ($2,500 for married employee filing separate return). Free e file 2011 Educational assistance Exempt up to $5,250 of benefits each year. Free e file 2011 (See Educational Assistance , later in this section. Free e file 2011 ) Employee discounts Exempt3 up to certain limits. Free e file 2011 (See Employee Discounts , later in this section. Free e file 2011 ) Employee stock options See Employee Stock Options , later in this section. Free e file 2011 Employer-provided cell phones Exempt if provided primarily for noncompensatory business purposes. Free e file 2011 Group-term life insurance coverage Exempt Exempt1,4, 7 up to cost of $50,000 of coverage. Free e file 2011 (Special rules apply to former employees. Free e file 2011 ) Exempt Health savings accounts (HSAs) Exempt for qualified individuals up to the HSA contribution limits. Free e file 2011 (See Health Savings Accounts , later in this section. Free e file 2011 ) Lodging on your business premises Exempt1 if furnished for your convenience as a condition of employment. Free e file 2011 Meals Exempt if furnished on your business premises for your convenience. Free e file 2011 Exempt if de minimis. Free e file 2011 Moving expense reimbursements Exempt1 if expenses would be deductible if the employee had paid them. Free e file 2011 No-additional-cost services Exempt3 Exempt3 Exempt3 Retirement planning services Exempt5 Exempt5 Exempt5 Transportation (commuting) benefits Exempt1 up to certain limits if for rides in a commuter highway vehicle and/or transit passes ($130), qualified parking ($250), or qualified bicycle commuting reimbursement6 ($20). Free e file 2011 (See Transportation (Commuting) Benefits , later in this section. Free e file 2011 ) Exempt if de minimis. Free e file 2011 Tuition reduction Exempt3 if for undergraduate education (or graduate education if the employee performs teaching or research activities). Free e file 2011 Working condition benefits Exempt Exempt Exempt 1 Exemption does not apply to S corporation employees who are 2% shareholders. Free e file 2011 2 Exemption does not apply to certain highly compensated employees under a self-insured plan that favors those employees. Free e file 2011 3 Exemption does not apply to certain highly compensated employees under a program that favors those employees. Free e file 2011 4 Exemption does not apply to certain key employees under a plan that favors those employees. Free e file 2011 5 Exemption does not apply to services for tax preparation, accounting, legal, or brokerage services. Free e file 2011 6 If the employee receives a qualified bicycle commuting reimbursement in a qualified bicycle commuting month, the employee cannot receive commuter highway vehicle, transit pass, or qualified parking benefits in that same month. Free e file 2011 7 You must include in your employee's wages the cost of group-term life insurance beyond $50,000 worth of coverage, reduced by the amount the employee paid toward the insurance. Free e file 2011 Report it as wages in boxes 1, 3, and 5 of the employee's Form W-2. Free e file 2011 Also, show it in box 12 with code “C. Free e file 2011 ” The amount is subject to social security and Medicare taxes, and you may, at your option, withhold federal income tax. Free e file 2011 Accident and Health Benefits This exclusion applies to contributions you make to an accident or health plan for an employee, including the following. Free e file 2011 Contributions to the cost of accident or health insurance including qualified long-term care insurance. Free e file 2011 Contributions to a separate trust or fund that directly or through insurance provides accident or health benefits. Free e file 2011 Contributions to Archer MSAs or health savings accounts (discussed in Publication 969, Health Savings Accounts and Other Tax-Favored Health Plans). Free e file 2011 This exclusion also applies to payments you directly or indirectly make to an employee under an accident or health plan for employees that are either of the following. Free e file 2011 Payments or reimbursements of medical expenses. Free e file 2011 Payments for specific injuries or illnesses (such as the loss of the use of an arm or leg). Free e file 2011 The payments must be figured without regard to any period of absence from work. Free e file 2011 Accident or health plan. Free e file 2011   This is an arrangement that provides benefits for your employees, their spouses, their dependents, and their children (under age 27) in the event of personal injury or sickness. Free e file 2011 The plan may be insured or noninsured and does not need to be in writing. Free e file 2011 Employee. Free e file 2011   For this exclusion, treat the following individuals as employees. Free e file 2011 A current common-law employee. Free e file 2011 A full-time life insurance agent who is a current statutory employee. Free e file 2011 A retired employee. Free e file 2011 A former employee you maintain coverage for based on the employment relationship. Free e file 2011 A widow or widower of an individual who died while an employee. Free e file 2011 A widow or widower of a retired employee. Free e file 2011 For the exclusion of contributions to an accident or health plan, a leased employee who has provided services to you on a substantially full-time basis for at least a year if the services are performed under your primary direction or control. Free e file 2011 Special rule for certain government plans. Free e file 2011   For certain government accident and health plans, payments to a deceased plan participant's beneficiary may qualify for the exclusion from gross income if the other requirements for exclusion are met. Free e file 2011 See section 105(j) for details. Free e file 2011 Exception for S corporation shareholders. Free e file 2011   Do not treat a 2% shareholder of an S corporation as an employee of the corporation for this purpose. Free e file 2011 A 2% shareholder is someone who directly or indirectly owns (at any time during the year) more than 2% of the corporation's stock or stock with more than 2% of the voting power. Free e file 2011 Treat a 2% shareholder as you would a partner in a partnership for fringe benefit purposes, but do not treat the benefit as a reduction in distributions to the 2% shareholder. Free e file 2011 Exclusion from wages. Free e file 2011   You can generally exclude the value of accident or health benefits you provide to an employee from the employee's wages. Free e file 2011 Exception for certain long-term care benefits. Free e file 2011   You cannot exclude contributions to the cost of long-term care insurance from an employee's wages subject to federal income tax withholding if the coverage is provided through a flexible spending or similar arrangement. Free e file 2011 This is a benefit program that reimburses specified expenses up to a maximum amount that is reasonably available to the employee and is less than five times the total cost of the insurance. Free e file 2011 However, you can exclude these contributions from the employee's wages subject to social security, Medicare, and federal unemployment (FUTA) taxes. Free e file 2011 S corporation shareholders. Free e file 2011   Because you cannot treat a 2% shareholder of an S corporation as an employee for this exclusion, you must include the value of accident or health benefits you provide to the employee in the employee's wages subject to federal income tax withholding. Free e file 2011 However, you can exclude the value of these benefits (other than payments for specific injuries or illnesses) from the employee's wages subject to social security, Medicare, and FUTA taxes. Free e file 2011 Exception for highly compensated employees. Free e file 2011   If your plan is a self-insured medical reimbursement plan that favors highly compensated employees, you must include all or part of the amounts you pay to these employees in their wages subject to federal income tax withholding. Free e file 2011 However, you can exclude these amounts (other than payments for specific injuries or illnesses) from the employee's wages subject to social security, Medicare, and FUTA taxes. Free e file 2011   A self-insured plan is a plan that reimburses your employees for medical expenses not covered by an accident or health insurance policy. Free e file 2011   A highly compensated employee for this exception is any of the following individuals. Free e file 2011 One of the five highest paid officers. Free e file 2011 An employee who owns (directly or indirectly) more than 10% in value of the employer's stock. Free e file 2011 An employee who is among the highest paid 25% of all employees (other than those who can be excluded from the plan). Free e file 2011   For more information on this exception, see section 105(h) of the Internal Revenue Code and its regulations. Free e file 2011 COBRA premiums. Free e file 2011   The exclusion for accident and health benefits applies to amounts you pay to maintain medical coverage for a current or former employee under the Combined Omnibus Budget Reconciliation Act of 1986 (COBRA). Free e file 2011 The exclusion applies regardless of the length of employment, whether you directly pay the premiums or reimburse the former employee for premiums paid, and whether the employee's separation is permanent or temporary. Free e file 2011 Achievement Awards This exclusion applies to the value of any tangible personal property you give to an employee as an award for either length of service or safety achievement. Free e file 2011 The exclusion does not apply to awards of cash, cash equivalents, gift certificates, or other intangible property such as vacations, meals, lodging, tickets to theater or sporting events, stocks, bonds, and other securities. Free e file 2011 The award must meet the requirements for employee achievement awards discussed in chapter 2 of Publication 535, Business Expenses. Free e file 2011 Employee. Free e file 2011   For this exclusion, treat the following individuals as employees. Free e file 2011 A current employee. Free e file 2011 A former common-law employee you maintain coverage for in consideration of or based on an agreement relating to prior service as an employee. Free e file 2011 A leased employee who has provided services to you on a substantially full-time basis for at least a year if the services are performed under your primary direction or control. Free e file 2011 Exception for S corporation shareholders. Free e file 2011   Do not treat a 2% shareholder of an S corporation as an employee of the corporation for this purpose. Free e file 2011 A 2% shareholder is someone who directly or indirectly owns (at any time during the year) more than 2% of the corporation's stock or stock with more than 2% of the voting power. Free e file 2011 Treat a 2% shareholder as you would a partner in a partnership for fringe benefit purposes, but do not treat the benefit as a reduction in distributions to the 2% shareholder. Free e file 2011 Exclusion from wages. Free e file 2011   You can generally exclude the value of achievement awards you give to an employee from the employee's wages if their cost is not more than the amount you can deduct as a business expense for the year. Free e file 2011 The excludable annual amount is $1,600 ($400 for awards that are not “qualified plan awards”). Free e file 2011 See chapter 2 of Publication 535 for more information about the limit on deductions for employee achievement awards. Free e file 2011    To determine for 2014 whether an achievement award is a “qualified plan award” under the deduction rules described in Publication 535, treat any employee who received more than $115,000 in pay for 2013 as a highly compensated employee. Free e file 2011   If the cost of awards given to an employee is more than your allowable deduction, include in the employee's wages the larger of the following amounts. Free e file 2011 The part of the cost that is more than your allowable deduction (up to the value of the awards). Free e file 2011 The amount by which the value of the awards exceeds your allowable deduction. Free e file 2011 Exclude the remaining value of the awards from the employee's wages. Free e file 2011 Adoption Assistance An adoption assistance program is a separate written plan of an employer that meets all of the following requirements. Free e file 2011 It benefits employees who qualify under rules set up by you, which do not favor highly compensated employees or their dependents. Free e file 2011 To determine whether your plan meets this test, do not consider employees excluded from your plan who are covered by a collective bargaining agreement, if there is evidence that adoption assistance was a subject of good-faith bargaining. Free e file 2011 It does not pay more than 5% of its payments during the year for shareholders or owners (or their spouses or dependents). Free e file 2011 A shareholder or owner is someone who owns (on any day of the year) more than 5% of the stock or of the capital or profits interest of your business. Free e file 2011 You give reasonable notice of the plan to eligible employees. Free e file 2011 Employees provide reasonable substantiation that payments or reimbursements are for qualifying expenses. Free e file 2011 For this exclusion, a highly compensated employee for 2014 is an employee who meets either of the following tests. Free e file 2011 The employee was a 5% owner at any time during the year or the preceding year. Free e file 2011 The employee received more than $115,000 in pay for the preceding year. Free e file 2011 You can choose to ignore test (2) if the employee was not also in the top 20% of employees when ranked by pay for the preceding year. Free e file 2011 You must exclude all payments or reimbursements you make under an adoption assistance program for an employee's qualified adoption expenses from the employee's wages subject to federal income tax withholding. Free e file 2011 However, you cannot exclude these payments from wages subject to social security, Medicare, and federal unemployment (FUTA) taxes. Free e file 2011 For more information, see the Instructions for Form 8839, Qualified Adoption Expenses. Free e file 2011 You must report all qualifying adoption expenses you paid or reimbursed under your adoption assistance program for each employee for the year in box 12 of the employee's Form W-2. Free e file 2011 Use code “T” to identify this amount. Free e file 2011 Exception for S corporation shareholders. Free e file 2011   For this exclusion, do not treat a 2% shareholder of an S corporation as an employee of the corporation. Free e file 2011 A 2% shareholder is someone who directly or indirectly owns (at any time during the year) more than 2% of the corporation's stock or stock with more than 2% of the voting power. Free e file 2011 Treat a 2% shareholder as you would a partner in a partnership for fringe benefit purposes, including using the benefit as a reduction in distributions to the 2% shareholder. Free e file 2011 Athletic Facilities You can exclude the value of an employee's use of an on-premises gym or other athletic facility you operate from an employee's wages if substantially all use of the facility during the calendar year is by your employees, their spouses, and their dependent children. Free e file 2011 For this purpose, an employee's dependent child is a child or stepchild who is the employee's dependent or who, if both parents are deceased, has not attained the age of 25. Free e file 2011 On-premises facility. Free e file 2011   The athletic facility must be located on premises you own or lease. Free e file 2011 It does not have to be located on your business premises. Free e file 2011 However, the exclusion does not apply to an athletic facility for residential use, such as athletic facilities that are part of a resort. Free e file 2011 Employee. Free e file 2011   For this exclusion, treat the following individuals as employees. Free e file 2011 A current employee. Free e file 2011 A former employee who retired or left on disability. Free e file 2011 A widow or widower of an individual who died while an employee. Free e file 2011 A widow or widower of a former employee who retired or left on disability. Free e file 2011 A leased employee who has provided services to you on a substantially full-time basis for at least a year if the services are performed under your primary direction or control. Free e file 2011 A partner who performs services for a partnership. Free e file 2011 De Minimis (Minimal) Benefits You can exclude the value of a de minimis benefit you provide to an employee from the employee's wages. Free e file 2011 A de minimis benefit is any property or service you provide to an employee that has so little value (taking into account how frequently you provide similar benefits to your employees) that accounting for it would be unreasonable or administratively impracticable. Free e file 2011 Cash and cash equivalent fringe benefits (for example, use of gift card, charge card, or credit card), no matter how little, are never excludable as a de minimis benefit, except for occasional meal money or transportation fare. Free e file 2011 Examples of de minimis benefits include the following. Free e file 2011 Personal use of an employer-provided cell phone provided primarily for noncompensatory business purposes. Free e file 2011 See Employer-Provided Cell Phones , later in this section, for details. Free e file 2011 Occasional personal use of a company copying machine if you sufficiently control its use so that at least 85% of its use is for business purposes. Free e file 2011 Holiday gifts, other than cash, with a low fair market value. Free e file 2011 Group-term life insurance payable on the death of an employee's spouse or dependent if the face amount is not more than $2,000. Free e file 2011 Meals. Free e file 2011 See Meals , later in this section, for details. Free e file 2011 Occasional parties or picnics for employees and their guests. Free e file 2011 Occasional tickets for theater or sporting events. Free e file 2011 Transportation fare. Free e file 2011 See Transportation (Commuting) Benefits , later in this section, for details. Free e file 2011 Employee. Free e file 2011   For this exclusion, treat any recipient of a de minimis benefit as an employee. Free e file 2011 Dependent Care Assistance This exclusion applies to household and dependent care services you directly or indirectly pay for or provide to an employee under a dependent care assistance program that covers only your employees. Free e file 2011 The services must be for a qualifying person's care and must be provided to allow the employee to work. Free e file 2011 These requirements are basically the same as the tests the employee would have to meet to claim the dependent care credit if the employee paid for the services. Free e file 2011 For more information, see Qualifying Person Test and Work-Related Expense Test in Publication 503, Child and Dependent Care Expenses. Free e file 2011 Employee. Free e file 2011   For this exclusion, treat the following individuals as employees. Free e file 2011 A current employee. Free e file 2011 A leased employee who has provided services to you on a substantially full-time basis for at least a year if the services are performed under your primary direction or control. Free e file 2011 Yourself (if you are a sole proprietor). Free e file 2011 A partner who performs services for a partnership. Free e file 2011 Exclusion from wages. Free e file 2011   You can exclude the value of benefits you provide to an employee under a dependent care assistance program from the employee's wages if you reasonably believe that the employee can exclude the benefits from gross income. Free e file 2011   An employee can generally exclude from gross income up to $5,000 of benefits received under a dependent care assistance program each year. Free e file 2011 This limit is reduced to $2,500 for married employees filing separate returns. Free e file 2011   However, the exclusion cannot be more than the smaller of the earned income of either the employee or employee's spouse. Free e file 2011 Special rules apply to determine the earned income of a spouse who is either a student or not able to care for himself or herself. Free e file 2011 For more information on the earned income limit, see Publication 503. Free e file 2011 Exception for highly compensated employees. Free e file 2011   You cannot exclude dependent care assistance from the wages of a highly compensated employee unless the benefits provided under the program do not favor highly compensated employees and the program meets the requirements described in section 129(d) of the Internal Revenue Code. Free e file 2011   For this exclusion, a highly compensated employee for 2014 is an employee who meets either of the following tests. Free e file 2011 The employee was a 5% owner at any time during the year or the preceding year. Free e file 2011 The employee received more than $115,000 in pay for the preceding year. Free e file 2011 You can choose to ignore test (2) if the employee was not also in the top 20% of employees when ranked by pay for the preceding year. Free e file 2011 Form W-2. Free e file 2011   Report the value of all dependent care assistance you provide to an employee under a dependent care assistance program in box 10 of the employee's Form W-2. Free e file 2011 Include any amounts you cannot exclude from the employee's wages in boxes 1, 3, and 5. Free e file 2011 Report both the nontaxable portion of assistance (up to $5,000) and any assistance above the amount that is non-taxable to the employee. Free e file 2011 Example. Free e file 2011   Company A provides a dependent care assistance flexible spending arrangement to its employees through a cafeteria plan. Free e file 2011 In addition, it provides occasional on-site dependent care to its employees at no cost. Free e file 2011 Emily, an employee of company A, had $4,500 deducted from her pay for the dependent care flexible spending arrangement. Free e file 2011 In addition, Emily used the on-site dependent care several times. Free e file 2011 The fair market value of the on-site care was $700. Free e file 2011 Emily's Form W-2 should report $5,200 of dependent care assistance in box 10 ($4,500 flexible spending arrangement plus $700 on-site dependent care). Free e file 2011 Boxes 1, 3, and 5 should include $200 (the amount in excess of the nontaxable assistance), and applicable taxes should be withheld on that amount. Free e file 2011 Educational Assistance This exclusion applies to educational assistance you provide to employees under an educational assistance program. Free e file 2011 The exclusion also applies to graduate level courses. Free e file 2011 Educational assistance means amounts you pay or incur for your employees' education expenses. Free e file 2011 These expenses generally include the cost of books, equipment, fees, supplies, and tuition. Free e file 2011 However, these expenses do not include the cost of a course or other education involving sports, games, or hobbies, unless the education: Has a reasonable relationship to your business, or Is required as part of a degree program. Free e file 2011 Education expenses do not include the cost of tools or supplies (other than textbooks) your employee is allowed to keep at the end of the course. Free e file 2011 Nor do they include the cost of lodging, meals, or transportation. Free e file 2011 Educational assistance program. Free e file 2011   An educational assistance program is a separate written plan that provides educational assistance only to your employees. Free e file 2011 The program qualifies only if all of the following tests are met. Free e file 2011 The program benefits employees who qualify under rules set up by you that do not favor highly compensated employees. Free e file 2011 To determine whether your program meets this test, do not consider employees excluded from your program who are covered by a collective bargaining agreement if there is evidence that educational assistance was a subject of good-faith bargaining. Free e file 2011 The program does not provide more than 5% of its benefits during the year for shareholders or owners. Free e file 2011 A shareholder or owner is someone who owns (on any day of the year) more than 5% of the stock or of the capital or profits interest of your business. Free e file 2011 The program does not allow employees to choose to receive cash or other benefits that must be included in gross income instead of educational assistance. Free e file 2011 You give reasonable notice of the program to eligible employees. Free e file 2011 Your program can cover former employees if their employment is the reason for the coverage. Free e file 2011   For this exclusion, a highly compensated employee for 2014 is an employee who meets either of the following tests. Free e file 2011 The employee was a 5% owner at any time during the year or the preceding year. Free e file 2011 The employee received more than $115,000 in pay for the preceding year. Free e file 2011 You can choose to ignore test (2) if the employee was not also in the top 20% of employees when ranked by pay for the preceding year. Free e file 2011 Employee. Free e file 2011   For this exclusion, treat the following individuals as employees. Free e file 2011 A current employee. Free e file 2011 A former employee who retired, left on disability, or was laid off. Free e file 2011 A leased employee who has provided services to you on a substantially full-time basis for at least a year if the services are performed under your primary direction or control. Free e file 2011 Yourself (if you are a sole proprietor). Free e file 2011 A partner who performs services for a partnership. Free e file 2011 Exclusion from wages. Free e file 2011   You can exclude up to $5,250 of educational assistance you provide to an employee under an educational assistance program from the employee's wages each year. Free e file 2011 Assistance over $5,250. Free e file 2011   If you do not have an educational assistance plan, or you provide an employee with assistance exceeding $5,250, you must include the value of these benefits as wages, unless the benefits are working condition benefits. Free e file 2011 Working condition benefits may be excluded from wages. Free e file 2011 Property or a service provided is a working condition benefit to the extent that if the employee paid for it, the amount paid would have been deductible as a business or depreciation expense. Free e file 2011 See Working Condition Benefits , later, in this section. Free e file 2011 Employee Discounts This exclusion applies to a price reduction you give an employee on property or services you offer to customers in the ordinary course of the line of business in which the employee performs substantial services. Free e file 2011 However, it does not apply to discounts on real property or discounts on personal property of a kind commonly held for investment (such as stocks or bonds). Free e file 2011 Employee. Free e file 2011   For this exclusion, treat the following individuals as employees. Free e file 2011 A current employee. Free e file 2011 A former employee who retired or left on disability. Free e file 2011 A widow or widower of an individual who died while an employee. Free e file 2011 A widow or widower of an employee who retired or left on disability. Free e file 2011 A leased employee who has provided services to you on a substantially full-time basis for at least a year if the services are performed under your primary direction or control. Free e file 2011 A partner who performs services for a partnership. Free e file 2011 Exclusion from wages. Free e file 2011   You can generally exclude the value of an employee discount you provide an employee from the employee's wages, up to the following limits. Free e file 2011 For a discount on services, 20% of the price you charge nonemployee customers for the service. Free e file 2011 For a discount on merchandise or other property, your gross profit percentage times the price you charge nonemployee customers for the property. Free e file 2011   Determine your gross profit percentage in the line of business based on all property you offer to customers (including employee customers) and your experience during the tax year immediately before the tax year in which the discount is available. Free e file 2011 To figure your gross profit percentage, subtract the total cost of the property from the total sales price of the property and divide the result by the total sales price of the property. Free e file 2011 Exception for highly compensated employees. Free e file 2011   You cannot exclude from the wages of a highly compensated employee any part of the value of a discount that is not available on the same terms to one of the following groups. Free e file 2011 All of your employees. Free e file 2011 A group of employees defined under a reasonable classification you set up that does not favor highly compensated employees. Free e file 2011   For this exclusion, a highly compensated employee for 2014 is an employee who meets either of the following tests. Free e file 2011 The employee was a 5% owner at any time during the year or the preceding year. Free e file 2011 The employee received more than $115,000 in pay for the preceding year. Free e file 2011 You can choose to ignore test (2) if the employee was not also in the top 20% of employees when ranked by pay for the preceding year. Free e file 2011 Employee Stock Options There are three kinds of stock options—incentive stock options, employee stock purchase plan options, and nonstatutory (nonqualified) stock options. Free e file 2011 Wages for social security, Medicare, and federal unemployment (FUTA) taxes do not include remuneration resulting from the exercise, after October 22, 2004, of an incentive stock option or under an employee stock purchase plan option, or from any disposition of stock acquired by exercising such an option. Free e file 2011 The IRS will not apply these taxes to an exercise before October 23, 2004, of an incentive stock option or an employee stock purchase plan option or to a disposition of stock acquired by such exercise. Free e file 2011 Additionally, federal income tax withholding is not required on the income resulting from a disqualifying disposition of stock acquired by the exercise after October 22, 2004, of an incentive stock option or under an employee stock purchase plan option, or on income equal to the discount portion of stock acquired by the exercise, after October 22, 2004, of an employee stock purchase plan option resulting from any disposition of the stock. Free e file 2011 The IRS will not apply federal income tax withholding upon the disposition of stock acquired by the exercise, before October 23, 2004, of an incentive stock option or an employee stock purchase plan option. Free e file 2011 However, the employer must report as income in box 1 of Form W-2, (a) the discount portion of stock acquired by the exercise of an employee stock purchase plan option upon disposition of the stock, and (b) the spread (between the exercise price and the fair market value of the stock at the time of exercise) upon a disqualifying disposition of stock acquired by the exercise of an incentive stock option or an employee stock purchase plan option. Free e file 2011 An employer must report the excess of the fair market value of stock received upon exercise of a nonstatutory stock option over the amount paid for the stock option on Form W-2 in boxes 1, 3 (up to the social security wage base), 5, and in box 12 using the code “V. Free e file 2011 ” See Regulations section 1. Free e file 2011 83-7. Free e file 2011 An employee who transfers his or her interest in nonstatutory stock options to the employee's former spouse incident to a divorce is not required to include an amount in gross income upon the transfer. Free e file 2011 The former spouse, rather than the employee, is required to include an amount in gross income when the former spouse exercises the stock options. Free e file 2011 See Revenue Ruling 2002-22 and Revenue Ruling 2004-60 for details. Free e file 2011 You can find Revenue Ruling 2002-22 on page 849 of Internal Revenue Bulletin 2002-19 at www. Free e file 2011 irs. Free e file 2011 gov/pub/irs-irbs/irb02-19. Free e file 2011 pdf. Free e file 2011 See Revenue Ruling 2004-60, 2004-24 I. Free e file 2011 R. Free e file 2011 B. Free e file 2011 1051, available at www. Free e file 2011 irs. Free e file 2011 gov/irb/2004-24_IRB/ar13. Free e file 2011 html. Free e file 2011 For more information about employee stock options, see sections 421, 422, and 423 of the Internal Revenue Code and their related regulations. Free e file 2011 Employer-Provided Cell Phones The value of an employer-provided cell phone, provided primarily for noncompensatory business reasons, is excludable from an employee's income as a working condition fringe benefit. Free e file 2011 Personal use of an employer-provided cell phone, provided primarily for noncompensatory business reasons, is excludable from an employee's income as a de minimis fringe benefit. Free e file 2011 For the rules relating to these types of benefits, see De Minimis (Minimal) Benefits , earlier in this section, and Working Condition Benefits , later in this section. Free e file 2011 Noncompensatory business purposes. Free e file 2011   You provide a cell phone primarily for noncompensatory business purposes if there are substantial business reasons for providing the cell phone. Free e file 2011 Examples of substantial business reasons include the employer's: Need to contact the employee at all times for work-related emergencies, Requirement that the employee be available to speak with clients at times when the employee is away from the office, and Need to speak with clients located in other time zones at times outside the employee's normal workday. Free e file 2011 Cell phones provided to promote goodwill, boost morale, or attract prospective employees. Free e file 2011   You cannot exclude from an employee's wages the value of a cell phone provided to promote goodwill of an employee, to attract a prospective employee, or as a means of providing additional compensation to an employee. Free e file 2011 Additional information. Free e file 2011   For additional information on the tax treatment of employer-provided cell phones, see Notice 2011-72, 2011-38 I. Free e file 2011 R. Free e file 2011 B. Free e file 2011 407, available at  www. Free e file 2011 irs. Free e file 2011 gov/irb/2011-38_IRB/ar07. Free e file 2011 html. Free e file 2011 Group-Term Life Insurance Coverage This exclusion applies to life insurance coverage that meets all the following conditions. Free e file 2011 It provides a general death benefit that is not included in income. Free e file 2011 You provide it to a group of employees. Free e file 2011 See The 10-employee rule , later. Free e file 2011 It provides an amount of insurance to each employee based on a formula that prevents individual selection. Free e file 2011 This formula must use factors such as the employee's age, years of service, pay, or position. Free e file 2011 You provide it under a policy you directly or indirectly carry. Free e file 2011 Even if you do not pay any of the policy's cost, you are considered to carry it if you arrange for payment of its cost by your employees and charge at least one employee less than, and at least one other employee more than, the cost of his or her insurance. Free e file 2011 Determine the cost of the insurance, for this purpose, as explained under Coverage over the limit , later. Free e file 2011 Group-term life insurance does not include the following insurance. Free e file 2011 Insurance that does not provide general death benefits, such as travel insurance or a policy providing only accidental death benefits. Free e file 2011 Life insurance on the life of your employee's spouse or dependent. Free e file 2011 However, you may be able to exclude the cost of this insurance from the employee's wages as a de minimis benefit. Free e file 2011 See De Minimis (Minimal) Benefits , earlier in this section. Free e file 2011 Insurance provided under a policy that provides a permanent benefit (an economic value that extends beyond 1 policy year, such as paid-up or cash surrender value), unless certain requirements are met. Free e file 2011 See Regulations section 1. Free e file 2011 79-1 for details. Free e file 2011 Employee. Free e file 2011   For this exclusion, treat the following individuals as employees. Free e file 2011 A current common-law employee. Free e file 2011 A full-time life insurance agent who is a current statutory employee. Free e file 2011 An individual who was formerly your employee under (1) or (2). Free e file 2011 A leased employee who has provided services to you on a substantially full-time basis for at least a year if the services are performed under your primary direction and control. Free e file 2011 Exception for S corporation shareholders. Free e file 2011   Do not treat a 2% shareholder of an S corporation as an employee of the corporation for this purpose. Free e file 2011 A 2% shareholder is someone who directly or indirectly owns (at any time during the year) more than 2% of the corporation's stock or stock with more than 2% of the voting power. Free e file 2011 Treat a 2% shareholder as you would a partner in a partnership for fringe benefit purposes, but do not treat the benefit as a reduction in distributions to the 2% shareholder. Free e file 2011 The 10-employee rule. Free e file 2011   Generally, life insurance is not group-term life insurance unless you provide it to at least 10 full-time employees at some time during the year. Free e file 2011   For this rule, count employees who choose not to receive the insurance unless, to receive it, they must contribute to the cost of benefits other than the group-term life insurance. Free e file 2011 For example, count an employee who could receive insurance by paying part of the cost, even if that employee chooses not to receive it. Free e file 2011 However, do not count an employee who must pay part or all of the cost of permanent benefits to get insurance, unless that employee chooses to receive it. Free e file 2011 A permanent benefit is an economic value extending beyond one policy year (for example, a paid-up or cash-surrender value) that is provided under a life insurance policy. Free e file 2011 Exceptions. Free e file 2011   Even if you do not meet the 10-employee rule, two exceptions allow you to treat insurance as group-term life insurance. Free e file 2011   Under the first exception, you do not have to meet the 10-employee rule if all the following conditions are met. Free e file 2011 If evidence that the employee is insurable is required, it is limited to a medical questionnaire (completed by the employee) that does not require a physical. Free e file 2011 You provide the insurance to all your full-time employees or, if the insurer requires the evidence mentioned in (1), to all full-time employees who provide evidence the insurer accepts. Free e file 2011 You figure the coverage based on either a uniform percentage of pay or the insurer's coverage brackets that meet certain requirements. Free e file 2011 See Regulations section 1. Free e file 2011 79-1 for details. Free e file 2011   Under the second exception, you do not have to meet the 10-employee rule if all the following conditions are met. Free e file 2011 You provide the insurance under a common plan covering your employees and the employees of at least one other employer who is not related to you. Free e file 2011 The insurance is restricted to, but mandatory for, all your employees who belong to, or are represented by, an organization (such as a union) that carries on substantial activities besides obtaining insurance. Free e file 2011 Evidence of whether an employee is insurable does not affect an employee's eligibility for insurance or the amount of insurance that employee gets. Free e file 2011   To apply either exception, do not consider employees who were denied insurance for any of the following reasons. Free e file 2011 They were 65 or older. Free e file 2011 They customarily work 20 hours or less a week or 5 months or less in a calendar year. Free e file 2011 They have not been employed for the waiting period given in the policy. Free e file 2011 This waiting period cannot be more than 6 months. Free e file 2011 Exclusion from wages. Free e file 2011   You can generally exclude the cost of up to $50,000 of group-term life insurance from the wages of an insured employee. Free e file 2011 You can exclude the same amount from the employee's wages when figuring social security and Medicare taxes. Free e file 2011 In addition, you do not have to withhold federal income tax or pay FUTA tax on any group-term life insurance you provide to an employee. Free e file 2011 Coverage over the limit. Free e file 2011   You must include in your employee's wages the cost of group-term life insurance beyond $50,000 worth of coverage, reduced by the amount the employee paid toward the insurance. Free e file 2011 Report it as wages in boxes 1, 3, and 5 of the employee's Form W-2. Free e file 2011 Also, show it in box 12 with code “C. Free e file 2011 ” The amount is subject to social security and Medicare taxes, and you may, at your option, withhold federal income tax. Free e file 2011   Figure the monthly cost of the insurance to include in the employee's wages by multiplying the number of thousands of dollars of all insurance coverage over $50,000 (figured to the nearest $100) by the cost shown in Table 2-2. Free e file 2011 For all coverage provided within the calendar year, use the employee's age on the last day of the employee's tax year. Free e file 2011 You must prorate the cost from the table if less than a full month of coverage is involved. Free e file 2011 Table 2-2. Free e file 2011 Cost Per $1,000 of Protection For 1 Month Age Cost Under 25 $ . Free e file 2011 05 25 through 29 . Free e file 2011 06 30 through 34 . Free e file 2011 08 35 through 39 . Free e file 2011 09 40 through 44 . Free e file 2011 10 45 through 49 . Free e file 2011 15 50 through 54 . Free e file 2011 23 55 through 59 . Free e file 2011 43 60 through 64 . Free e file 2011 66 65 through 69 1. Free e file 2011 27 70 and older 2. Free e file 2011 06 You figure the total cost to include in the employee's wages by multiplying the monthly cost by the number of full months' coverage at that cost. Free e file 2011 Example. Free e file 2011 Tom's employer provides him with group-term life insurance coverage of $200,000. Free e file 2011 Tom is 45 years old, is not a key employee, and pays $100 per year toward the cost of the insurance. Free e file 2011 Tom's employer must include $170 in his wages. Free e file 2011 The $200,000 of insurance coverage is reduced by $50,000. Free e file 2011 The yearly cost of $150,000 of coverage is $270 ($. Free e file 2011 15 x 150 x 12), and is reduced by the $100 Tom pays for the insurance. Free e file 2011 The employer includes $170 in boxes 1, 3, and 5 of Tom's Form W-2. Free e file 2011 The employer also enters $170 in box 12 with code “C. Free e file 2011 ” Coverage for dependents. Free e file 2011   Group-term life insurance coverage paid by the employer for the spouse or dependents of an employee may be excludable from income as a de minimis fringe benefit if the face amount is not more than $2,000. Free e file 2011 If the face amount is greater than $2,000, the entire cost of the dependent coverage must be included in income unless the amount over $2,000 is purchased with employee contributions on an after-tax basis. Free e file 2011 The cost of the insurance is determined by using Table 2-2. Free e file 2011 Former employees. Free e file 2011   When group-term life insurance over $50,000 is provided to an employee (including retirees) after his or her termination, the employee share of social security and Medicare taxes on that period of coverage is paid by the former employee with his or her tax return and is not collected by the employer. Free e file 2011 You are not required to collect those taxes. Free e file 2011 Use the table above to determine the amount of social security and Medicare taxes owed by the former employee for coverage provided after separation from service. Free e file 2011 Report those uncollected amounts separately in box 12 of Form W-2 using codes “M” and “N. Free e file 2011 ” See the General Instructions for Forms W-2 and W-3 and the Instructions for Form 941. Free e file 2011 Exception for key employees. Free e file 2011   Generally, if your group-term life insurance plan favors key employees as to participation or benefits, you must include the entire cost of the insurance in your key employees' wages. Free e file 2011 This exception generally does not apply to church plans. Free e file 2011 When figuring social security and Medicare taxes, you must also include the entire cost in the employees' wages. Free e file 2011 Include the cost in boxes 1, 3, and 5 of Form W-2. Free e file 2011 However, you do not have to withhold federal income tax or pay FUTA tax on the cost of any group-term life insurance you provide to an employee. Free e file 2011   For this purpose, the cost of the insurance is the greater of the following amounts. Free e file 2011 The premiums you pay for the employee's insurance. Free e file 2011 See Regulations section 1. Free e file 2011 79-4T(Q&A 6) for more information. Free e file 2011 The cost you figure using Table 2-2. Free e file 2011   For this exclusion, a key employee during 2014 is an employee or former employee who is one of the following individuals. Free e file 2011 See section 416(i) of the Internal Revenue Code for more information. Free e file 2011 An officer having annual pay of more than $170,000. Free e file 2011 An individual who for 2014 was either of the following. Free e file 2011 A 5% owner of your business. Free e file 2011 A 1% owner of your business whose annual pay was more than $150,000. Free e file 2011   A former employee who was a key employee upon retirement or separation from service is also a key employee. Free e file 2011   Your plan does not favor key employees as to participation if at least one of the following is true. Free e file 2011 It benefits at least 70% of your employees. Free e file 2011 At least 85% of the participating employees are not key employees. Free e file 2011 It benefits employees who qualify under a set of rules you set up that do not favor key employees. Free e file 2011   Your plan meets this participation test if it is part of a cafeteria plan (discussed in section 1) and it meets the participation test for those plans. Free e file 2011   When applying this test, do not consider employees who: Have not completed 3 years of service, Are part-time or seasonal, Are nonresident aliens who receive no U. Free e file 2011 S. Free e file 2011 source earned income from you, or Are not included in the plan but are in a unit of employees covered by a collective bargaining agreement, if the benefits provided under the plan were the subject of good-faith bargaining between you and employee representatives. Free e file 2011   Your plan does not favor key employees as to benefits if all benefits available to participating key employees are also available to all other participating employees. Free e file 2011 Your plan does not favor key employees just because the amount of insurance you provide to your employees is uniformly related to their pay. Free e file 2011 S corporation shareholders. Free e file 2011   Because you cannot treat a 2% shareholder of an S corporation as an employee for this exclusion, you must include the cost of all group-term life insurance coverage you provide the 2% shareholder in his or her wages. Free e file 2011 When figuring social security and Medicare taxes, you must also include the cost of this coverage in the 2% shareholder's wages. Free e file 2011 Include the cost in boxes 1, 3, and 5 of Form W-2. Free e file 2011 However, you do not have to withhold federal income tax or pay federal unemployment tax on the cost of any group-term life insurance coverage you provide to the 2% shareholder. Free e file 2011 Health Savings Accounts A Health Savings Account (HSA) is an account owned by a qualified individual who is generally your employee or former employee. Free e file 2011 Any contributions that you make to an HSA become the employee's property and cannot be withdrawn by you. Free e file 2011 Contributions to the account are used to pay current or future medical expenses of the account owner, his or her spouse, and any qualified dependent. Free e file 2011 The medical expenses must not be reimbursable by insurance or other sources and their payment from HSA funds (distribution) will not give rise to a medical expense deduction on the individual's federal income tax return. Free e file 2011 For more information about HSAs, visit the Department of Treasury's website at www. Free e file 2011 treasury. Free e file 2011 gov and enter “HSA” in the search box. Free e file 2011 Eligibility. Free e file 2011   A qualified individual must be covered by a High Deductible Health Plan (HDHP) and not be covered by other health insurance except for permitted insurance listed under section 223(c)(3) or insurance for accidents, disability, dental care, vision care, or long-term care. Free e file 2011 For calendar year 2014, a qualifying HDHP must have a deductible of at least $1,250 for self-only coverage or $2,500 for family coverage and must limit annual out-of-pocket expenses of the beneficiary to $6,350 for self-only coverage and $12,700 for family coverage. Free e file 2011   There are no income limits that restrict an individual's eligibility to contribute to an HSA nor is there a requirement that the account owner have earned income to make a contribution. Free e file 2011 Exceptions. Free e file 2011   An individual is not a qualified individual if he or she can be claimed as a dependent on another person's tax return. Free e file 2011 Also, an employee's participation in a health flexible spending arrangement (FSA) or health reimbursement arrangement (HRA) generally disqualifies the individual (and employer) from making contributions to his or her HSA. Free e file 2011 However, an individual may qualify to participate in an HSA if he or she is participating in only a limited-purpose FSA or HRA or a post-deductible FSA. Free e file 2011 For more information, see Other employee health plans in Publication 969. Free e file 2011 Employer contributions. Free e file 2011   Up to specified dollar limits, cash contributions to the HSA of a qualified individual (determined monthly) are exempt from federal income tax withholding, social security tax, Medicare tax, and FUTA tax. Free e file 2011 For 2014, you can contribute up to $3,300 for self-only coverage or $6,550 for family coverage to a qualified individual's HSA. Free e file 2011   The contribution amounts listed above are increased by $1,000 for a qualified individual who is age 55 or older at any time during the year. Free e file 2011 For two qualified individuals who are married to each other and who each are age 55 or older at any time during the year, each spouse's contribution limit is increased by $1,000 provided each spouse has a separate HSA. Free e file 2011 No contributions can be made to an individual's HSA after he or she becomes enrolled in Medicare Part A or Part B. Free e file 2011 Nondiscrimination rules. Free e file 2011    Your contribution amount to an employee's HSA must be comparable for all employees who have comparable coverage during the same period. Free e file 2011 Otherwise, there will be an excise tax equal to 35% of the amount you contributed to all employees' HSAs. Free e file 2011   For guidance on employer comparable contributions to HSAs under section 4980G in instances where an employee has not established an HSA by December 31 and in instances where an employer accelerates contributions for the calendar year for employees who have incurred qualified medical expenses, see Regulations section 54. Free e file 2011 4980G-4. Free e file 2011 Exception. Free e file 2011   The Tax Relief and Health Care Act of 2006 allows employers to make larger HSA contributions for a nonhighly compensated employee than for a highly compensated employee. Free e file 2011 A highly compensated employee for 2014 is an employee who meets either of the following tests. Free e file 2011 The employee was a 5% owner at any time during the year or the preceding year. Free e file 2011 The employee received more than $115,000 in pay for the preceding year. Free e file 2011 You can choose to ignore test (2) if the employee was not also in the top 20% of employees when ranked by pay for the preceding year. Free e file 2011 Partnerships and S corporations. Free e file 2011   Partners and 2% shareholders of an S corporation are not eligible for salary reduction (pre-tax) contributions to an HSA. Free e file 2011 Employer contributions to the HSA of a bona fide partner or 2% shareholder are treated as distributions or guaranteed payments as determined by the facts and circumstances. Free e file 2011 Cafeteria plans. Free e file 2011   You may contribute to an employee's HSA using a cafeteria plan and your contributions are not subject to the statutory comparability rules. Free e file 2011 However, cafeteria plan nondiscrimination rules still apply. Free e file 2011 For example, contributions under a cafeteria plan to employee HSAs cannot be greater for higher-paid employees than they are for lower-paid employees. Free e file 2011 Contributions that favor lower-paid employees are not prohibited. Free e file 2011 Reporting requirements. Free e file 2011   You must report your contributions to an employee's HSA in box 12 of Form W-2 using code “W. Free e file 2011 ” The trustee or custodian of the HSA, generally a bank or insurance company, reports distributions from the HSA using Form 1099-SA, Distributions From an HSA, Archer MSA, or Medicare Advantage MSA. Free e file 2011 Lodging on Your Business Premises You can exclude the value of lodging you furnish to an employee from the employee's wages if it meets the following tests. Free e file 2011 It is furnished on your business premises. Free e file 2011 It is furnished for your convenience. Free e file 2011 The employee must accept it as a condition of employment. Free e file 2011 Different tests may apply to lodging furnished by educational institutions. Free e file 2011 See section 119(d) of the Internal Revenue Code for details. Free e file 2011 The exclusion does not apply if you allow your employee to choose to receive additional pay instead of lodging. Free e file 2011 On your business premises. Free e file 2011   For this exclusion, your business premises is generally your employee's place of work. Free e file 2011 For special rules that apply to lodging furnished in a camp located in a foreign country, see section 119(c) of the Internal Revenue Code and its regulations. Free e file 2011 For your convenience. Free e file 2011   Whether or not you furnish lodging for your convenience as an employer depends on all the facts and circumstances. Free e file 2011 You furnish the lodging to your employee for your convenience if you do this for a substantial business reason other than to provide the employee with additional pay. Free e file 2011 This is true even if a law or an employment contract provides that the lodging is furnished as pay. Free e file 2011 However, a written statement that the lodging is furnished for your convenience is not sufficient. Free e file 2011 Condition of employment. Free e file 2011   Lodging meets this test if you require your employees to accept the lodging because they need to live on your business premises to be able to properly perform their duties. Free e file 2011 Examples include employees who must be available at all times and employees who could not perform their required duties without being furnished the lodging. Free e file 2011   It does not matter whether you must furnish the lodging as pay under the terms of an employment contract or a law fixing the terms of employment. Free e file 2011 Example. Free e file 2011 A hospital gives Joan, an employee of the hospital, the choice of living at the hospital free of charge or living elsewhere and receiving a cash allowance in addition to her regular salary. Free e file 2011 If Joan chooses to live at the hospital, the hospital cannot exclude the value of the lodging from her wages because she is not required to live at the hospital to properly perform the duties of her employment. Free e file 2011 S corporation shareholders. Free e file 2011   For this exclusion, do not treat a 2% shareholder of an S corporation as an employee of the corporation. Free e file 2011 A 2% shareholder is someone who directly or indirectly owns (at any time during the year) more than 2% of the corporation's stock or stock with more than 2% of the voting power. Free e file 2011 Treat a 2% shareholder as you would a partner in a partnership for fringe benefit purposes, but do not treat the benefit as a reduction in distributions to the 2% shareholder. Free e file 2011 Meals This section discusses the exclusion rules that apply to de minimis meals and meals on your business premises. Free e file 2011 De Minimis Meals You can exclude any occasional meal or meal money you provide to an employee if it has so little value (taking into account how frequently you provide meals to your employees) that accounting for it would be unreasonable or administratively impracticable. Free e file 2011 The exclusion applies, for example, to the following items. Free e file 2011 Coffee, doughnuts, or soft drinks. Free e file 2011 Occasional meals or meal money provided to enable an employee to work overtime. Free e file 2011 However, the exclusion does not apply to meal money figured on the basis of hours worked. Free e file 2011 Occasional parties or picnics for employees and their guests. Free e file 2011 This exclusion also applies to meals you provide at an employer-operated eating facility for employees if the annual revenue from the facility equals or exceeds the direct costs of the facility. Free e file 2011 For this purpose, your revenue from providing a meal is considered equal to the facility's direct operating costs to provide that meal if its value can be excluded from an employee's wages as explained under Meals on Your Business Premises , later. Free e file 2011 If food or beverages you furnish to employees qualify as a de minimis benefit, you can deduct their full cost. Free e file 2011 The 50% limit on deductions for the cost of meals does not apply. Free e file 2011 The deduction limit on meals is discussed in chapter 2 of Publication 535. Free e file 2011 Employee. Free e file 2011   For this exclusion, treat any recipient of a de minimis meal as
Print - Click this link to Print this page

News & Events

IRS Warns of New Email Phishing Scheme Falsely Claiming to be from the Taxpayer Advocate Service
IR-2014-39, March 28, 2014 —The IRS today warned consumers to be on the lookout for a new email phishing scam. The emails appear to be from the IRS Taxpayer Advocate Service and include a bogus case number.‬

Many Retirees Face April 1 Deadline To Take Required Retirement Plan Distributions
IR-2014-38, March 27, 2014 — The IRS reminds taxpayers who turned 70½ during 2013 that in most cases they must start receiving required minimum distributions (RMDs) from Individual Retirement Accounts (IRAs) and workplace retirement plans by Tuesday, April 1, 2014.

IRS Reminds Taxpayers about Direct Deposit and Split Refunds
IR-2014-37, March 27, 2014 — Millions of taxpayers get their refunds through direct deposits. Filing season stats for March 21, 2014.

IRS Virtual Currency Guidance : Virtual Currency Is Treated as Property for U.S. Federal Tax Purposes; General Rules for Property Transactions Apply
IR-2014-36, March. 25, 2014 — Virtual currency is treated as property for U.S. Federal tax purposes; general rules for property transactions apply.

IRS Gives Colorado Flood Victims More Time To Decide When To Claim Losses
IR-2014-35, March 25, 2014 — The IRS today provided taxpayers an extension until Oct. 15, 2014, to decide when to claim disaster losses arising from last September’s flooding.

IRS Releases FY 2013 Data Book
IR-2014-34, March 21, 2014 — The IRS 2013 Data Book provides details on the agency's activities during fiscal year 2013.

Winter 2014 Statistics of Income Bulletin Now Available
IR-2014-33, March 20, 2014 — IRS winter 2014 Bulletin provides information on individual income tax returns filed for tax year 2012 and other topics.

More than Half of all Income Tax Returns Have Been Received. IRS Issues Publication on Business Expenses
IR-2014-32, March 20, 2014 — The IRS has received more than half of all the individual income tax returns it expects this year; issues business expense publication.

IRS Bars Appraisers from Valuing Facade Easements for Federal Tax Purposes for Five Years
IR-2014-31, March 19, 2014 — The IRS announced its Office of Professional Responsibility has entered into a settlement agreement with a group of appraisers from the same firm accused of aiding in the understatement of federal tax liabilities by overvaluing facade easements for charitable donation purposes.

IRS Has $760 Million for People Who Have Not Filed a 2010 Income Tax Return
IR-2014-30, March 19, 2014 — Taxpayers who did not file returns for tax year 2010 have until April 15 to claim their tax refunds.

Page Last Reviewed or Updated: 28-Mar-2014


 

The Free E File 2011

Free e file 2011 Publication 536 - Main Content Table of Contents NOL Steps How To Figure an NOLNonbusiness deductions (line 6). Free e file 2011 Nonbusiness income (line 7). Free e file 2011 Nonbusiness capital losses. Free e file 2011 Business capital losses. Free e file 2011 Illustrated Form 1045, Schedule A When To Use an NOLExceptions to 2-Year Carryback Rule Waiving the Carryback Period How To Carry an NOL Back or Forward How To Claim an NOL DeductionDeducting a Carryback Deducting a Carryforward Change in Marital Status Change in Filing Status Illustrated Form 1045 How To Figure an NOL CarryoverIllustrated Form 1045, Schedule B NOL Carryover From 2013 to 2014Worksheet Instructions How To Get Tax HelpLow Income Taxpayer Clinics NOL Steps Follow Steps 1 through 5 to figure and use your NOL. Free e file 2011 Step 1. Free e file 2011   Complete your tax return for the year. Free e file 2011 You may have an NOL if a negative figure appears on the line below: Individuals — Form 1040, line 41, or Form 1040NR, line 39. Free e file 2011 Estates and trusts — Form 1041, line 22. Free e file 2011   If the amount on that line is not negative, stop here — you do not have an NOL. Free e file 2011 Step 2. Free e file 2011   Determine whether you have an NOL and its amount. Free e file 2011 See How To Figure an NOL , later. Free e file 2011 If you do not have an NOL, stop here. Free e file 2011 Step 3. Free e file 2011   Decide whether to carry the NOL back to a past year or to waive the carryback period and instead carry the NOL forward to a future year. Free e file 2011 See When To Use an NOL , later. Free e file 2011 Step 4. Free e file 2011   Deduct the NOL in the carryback or carryforward year. Free e file 2011 See How To Claim an NOL Deduction , later. Free e file 2011 If your NOL deduction is equal to or less than your taxable income without the deduction, stop here — you have used up your NOL. Free e file 2011 Step 5. Free e file 2011   Determine the amount of your unused NOL. Free e file 2011 See How To Figure an NOL Carryover , later. Free e file 2011 Carry over the unused NOL to the next carryback or carryforward year and begin again at Step 4. Free e file 2011 Note. Free e file 2011   If your NOL deduction includes more than one NOL amount, apply Step 5 separately to each NOL amount, starting with the amount from the earliest year. Free e file 2011 How To Figure an NOL If your deductions for the year are more than your income for the year, you may have an NOL. Free e file 2011 There are rules that limit what you can deduct when figuring an NOL. Free e file 2011 In general, the following items are not allowed when figuring an NOL. Free e file 2011 Any deduction for personal exemptions. Free e file 2011 Capital losses in excess of capital gains. Free e file 2011 The section 1202 exclusion of the gain from the sale or exchange of qualified small business stock. Free e file 2011 Nonbusiness deductions in excess of nonbusiness income. Free e file 2011 The net operating loss deduction. Free e file 2011 The domestic production activities deduction. Free e file 2011 Form 1045, Schedule A. Free e file 2011   Use Form 1045, Schedule A, to figure an NOL. Free e file 2011 The following discussion explains Schedule A and includes an illustrated example. Free e file 2011   First, complete Form 1045, Schedule A, line 1, using amounts from your return. Free e file 2011 If line 1 is a negative amount, you may have an NOL. Free e file 2011   Next, complete the rest of Form 1045, Schedule A, to figure your NOL. Free e file 2011 Nonbusiness deductions (line 6). Free e file 2011   Enter on line 6 deductions that are not connected to your trade or business or your employment. Free e file 2011 Examples of deductions not related to your trade or business are: Alimony paid, Deductions for contributions to an IRA or a self-employed retirement plan, Health savings account deduction, Archer medical savings account deduction, Most itemized deductions (except for casualty and theft losses, state income tax on trade and business income, and any employee business expenses), and The standard deduction. Free e file 2011   Do not include on line 6 the deduction for personal exemptions for you, your spouse, or your dependents. Free e file 2011   Do not enter business deductions on line 6. Free e file 2011 These are deductions that are connected to your trade or business. Free e file 2011 They include the following. Free e file 2011 State income tax on income attributable to trade or business (including wages, salary, and unemployment compensation). Free e file 2011 Moving expenses. Free e file 2011 Educator expenses. Free e file 2011 The deduction for the deductible part of self-employed health insurance. Free e file 2011 Domestic production activities deduction. Free e file 2011 Rental losses. Free e file 2011 Loss on the sale or exchange of business real estate or depreciable property. Free e file 2011 Your share of a business loss from a partnership or an S corporation. Free e file 2011 Ordinary loss on the sale or exchange of stock in a small business corporation or a small business investment company. Free e file 2011 If you itemize your deductions, casualty and theft losses (even if they involve nonbusiness property) and employee business expenses (such as union dues, uniforms, tools, education expenses, and travel and transportation expenses). Free e file 2011 Loss on the sale of accounts receivable (if you use an accrual method of accounting). Free e file 2011 Interest and litigation expenses on state and federal income taxes related to your business. Free e file 2011 Unrecovered investment in a pension or annuity claimed on a decedent's final return. Free e file 2011 Payment by a federal employee to buy back sick leave used in an earlier year. Free e file 2011 Nonbusiness income (line 7). Free e file 2011   Enter on line 7 only income that is not related to your trade or business or your employment. Free e file 2011 For example, enter your annuity income, dividends, and interest on investments. Free e file 2011 Also, include your share of nonbusiness income from partnerships and S corporations. Free e file 2011   Do not include on line 7 the income you receive from your trade or business or your employment. Free e file 2011 This includes salaries and wages, self-employment income, unemployment compensation included in your gross income, and your share of business income from partnerships and S corporations. Free e file 2011 Also, do not include rental income or ordinary gain from the sale or other disposition of business real estate or depreciable business property. Free e file 2011 Adjustment for section 1202 exclusion (line 17). Free e file 2011   Enter on line 17 any gain you excluded under section 1202 on the sale or exchange of qualified small business stock. Free e file 2011 Adjustments for capital losses (lines 19–22). Free e file 2011   The amount deductible for capital losses is limited based on whether the losses are business capital losses or nonbusiness capital losses. Free e file 2011 Nonbusiness capital losses. Free e file 2011   You can deduct your nonbusiness capital losses (line 2) only up to the amount of your nonbusiness capital gains without regard to any section 1202 exclusion (line 3). Free e file 2011 If your nonbusiness capital losses are more than your nonbusiness capital gains without regard to any section 1202 exclusion, you cannot deduct the excess. Free e file 2011 Business capital losses. Free e file 2011   You can deduct your business capital losses (line 11) only up to the total of: Your nonbusiness capital gains that are more than the total of your nonbusiness capital losses and excess nonbusiness deductions (line 10), and Your total business capital gains without regard to any section 1202 exclusion (line 12). Free e file 2011 Domestic production activities deduction (line 23). Free e file 2011   You cannot take the domestic production activities deduction when figuring your NOL. Free e file 2011 Enter on line 23 any domestic production activities deduction claimed on your return. Free e file 2011 NOLs from other years (line 24). Free e file 2011   You cannot deduct any NOL carryovers or carrybacks from other years. Free e file 2011 Enter the total amount of your NOL deduction for losses from other years. Free e file 2011 Illustrated Form 1045, Schedule A The following example illustrates how to figure an NOL. Free e file 2011 It includes filled-in pages 1 and 2 of Form 1040 and Form 1045, Schedule A. Free e file 2011 Example. Free e file 2011 Glenn Johnson is in the retail record business. Free e file 2011 He is single and has the following income and deductions on his Form 1040 for 2013. Free e file 2011 See the illustrated Form 1040 , later. Free e file 2011 INCOME   Wages from part-time job $1,225 Interest on savings 425 Net long-term capital gain on sale of real estate used in business 2,000 Glenn's total income $3,650 DEDUCTIONS   Net loss from business (gross income of $67,000 minus expenses of $72,000) $5,000 Net short-term capital loss on sale of stock 1,000 Standard deduction 6,100 Personal exemption 3,900 Glenn's total deductions $16,000 Glenn's deductions exceed his income by $12,350 ($16,000 − $3,650). Free e file 2011 However, to figure whether he has an NOL, certain deductions are not allowed. Free e file 2011 He uses Form 1045, Schedule A, to figure his NOL. Free e file 2011 See the Illustrated Form 1045, Schedule A , later. Free e file 2011 The following items are not allowed on Form 1045, Schedule A. Free e file 2011 Nonbusiness net short-term capital loss $1,000 Nonbusiness deductions (standard deduction, $6,100) minus nonbusiness income (interest, $425) 5,675 Deduction for personal exemption 3,900 Total adjustments to net loss $10,575     Therefore, Glenn's NOL for 2013 is figured as follows: Glenn's total 2013 income $3,650 Less:     Glenn's original 2013 total deductions $16,000   Reduced by the disallowed items − 10,575 − 5,425 Glenn's NOL for 2013 $1,775 This image is too large to be displayed in the current screen. Free e file 2011 Please click the link to view the image. Free e file 2011 Form 1040, page 1 This image is too large to be displayed in the current screen. Free e file 2011 Please click the link to view the image. Free e file 2011 Form 1040, page 2 This image is too large to be displayed in the current screen. Free e file 2011 Please click the link to view the image. Free e file 2011 Form 1045, page 2 When To Use an NOL Generally, if you have an NOL for a tax year ending in 2013, you must carry back the entire amount of the NOL to the 2 tax years before the NOL year (the carryback period), and then carry forward any remaining NOL for up to 20 years after the NOL year (the carryforward period). Free e file 2011 You can, however, choose not to carry back an NOL and only carry it forward. Free e file 2011 See Waiving the Carryback Period , later. Free e file 2011 You cannot deduct any part of the NOL remaining after the 20-year carryforward period. Free e file 2011 NOL year. Free e file 2011   This is the year in which the NOL occurred. Free e file 2011 Exceptions to 2-Year Carryback Rule Eligible losses, farming losses, qualified disaster losses, and specified liability losses, all defined next, qualify for longer carryback periods. Free e file 2011 Eligible loss. Free e file 2011   The carryback period for eligible losses is 3 years. Free e file 2011 Only the eligible loss portion of the NOL can be carried back 3 years. Free e file 2011 An eligible loss is any part of an NOL that: Is from a casualty or theft, or Is attributable to a federally declared disaster for a qualified small business or certain qualified farming businesses. Free e file 2011 Qualified small business. Free e file 2011   A qualified small business is a sole proprietorship or a partnership that has average annual gross receipts (reduced by returns and allowances) of $5 million or less during the 3-year period ending with the tax year of the NOL. Free e file 2011 If the business did not exist for this entire 3-year period, use the period the business was in existence. Free e file 2011   An eligible loss does not include a farming loss or a qualified disaster loss. Free e file 2011 Farming loss. Free e file 2011   The carryback period for a farming loss is 5 years. Free e file 2011 Only the farming loss portion of the NOL can be carried back 5 years. Free e file 2011 A farming loss is the smaller of: The amount that would be the NOL for the tax year if only income and deductions attributable to farming businesses were taken into account, or The NOL for the tax year. Free e file 2011 Farming business. Free e file 2011   A farming business is a trade or business involving cultivation of land or the raising or harvesting of any agricultural or horticultural commodity. Free e file 2011 A farming business can include operating a nursery or sod farm or raising or harvesting most ornamental trees or trees bearing fruit, nuts, or other crops. Free e file 2011 The raising, shearing, feeding, caring for, training, and management of animals is also considered a farming business. Free e file 2011   A farming business does not include contract harvesting of an agricultural or horticultural commodity grown or raised by someone else. Free e file 2011 It also does not include a business in which you merely buy or sell plants or animals grown or raised entirely by someone else. Free e file 2011 Waiving the 5-year carryback. Free e file 2011   You can choose to figure the carryback period for a farming loss without regard to the special 5-year carryback rule. Free e file 2011 To make this choice for 2013, attach to your 2013 income tax return filed by the due date (including extensions) a statement that you are choosing to treat any 2013 farming losses without regard to the special 5-year carryback rule. Free e file 2011 If you filed your original return on time but did not file the statement with it, you can make this choice on an amended return filed within 6 months after the due date of the return (excluding extensions). Free e file 2011 Attach an election statement to your amended return, and write “Filed pursuant to section 301. Free e file 2011 9100-2” at the top of the statement. Free e file 2011 Once made, this choice is irrevocable. Free e file 2011 Qualified disaster loss. Free e file 2011   The carryback period for a qualified disaster loss is 5 years. Free e file 2011 Only the qualified disaster loss portion of the NOL can be carried back 5 years. Free e file 2011 A qualified disaster loss is the smaller of: The sum of: Any losses attributable to a federally declared disaster and occurring before January 1, 2010, in the disaster area, plus Any allowable qualified disaster expenses (even if you did not choose to treat those expenses as deductions in the current year), or The NOL for the tax year. Free e file 2011 Qualified disaster expenses. Free e file 2011   A qualified disaster expense is any capital expense paid or incurred in connection with a trade or business or with business-related property which is: For the abatement or control of hazardous substances that were released as a result of a federally declared disaster occurring before January 1, 2010, For the removal of debris from, or the demolition of structures on, real property which is business-related property damaged or destroyed as a result of a federally declared disaster occurring before January 1, 2010, or For the repair of business-related property damaged as a result of a federally declared disaster occurring before January 1, 2010. Free e file 2011 Business-related property is property held for use in a trade or business, property held for the production of income, or inventory property. Free e file 2011 Note. Free e file 2011 Section 198A allows taxpayers to treat certain capital expenses (qualified disaster expenses) as deductions in the year the expenses were paid or incurred. Free e file 2011 Excluded losses. Free e file 2011   A qualified disaster loss does not include any losses from property used in connection with any private or commercial golf course, country club, massage parlor, hot tub facility, suntan facility, or any store for which the principal business is the sale of alcoholic beverages for consumption off premises. Free e file 2011   A qualified disaster loss also does not include any losses from any gambling or animal racing property. Free e file 2011 Gambling or animal racing property is any equipment, furniture, software, or other property used directly in connection with gambling, the racing of animals, or the on-site viewing of such racing, and the portion of any real property (determined by square footage) that is dedicated to gambling, the racing of animals, or the on-site viewing of such racing, unless this portion is less than 100 square feet. Free e file 2011 Specified liability loss. Free e file 2011   The carryback period for a specified liability loss is 10 years. Free e file 2011 Only the specified liability loss portion of the NOL can be carried back 10 years. Free e file 2011 Generally, a specified liability loss is a loss arising from: Product liability and expenses incurred in the investigation or settlement of, or opposition to, product liability claims, or An act (or failure to act) that occurred at least 3 years before the beginning of the loss year and resulted in a liability under a federal or state law requiring: Reclamation of land, Dismantling of a drilling platform, Remediation of environmental contamination, or Payment under any workers compensation act. Free e file 2011   Any loss from a liability arising from (1) through (4) above can be taken into account as a specified liability loss only if you used an accrual method of accounting throughout the period in which the act (or failure to act) occurred. Free e file 2011 For details, see section 172(f). Free e file 2011 Waiving the 10-year carryback. Free e file 2011   You can choose to figure the carryback period for a specified liability loss without regard to the special 10-year carryback rule. Free e file 2011 To make this choice for 2013 attach to your 2013 income tax return filed by the due date (including extensions) a statement that you are choosing to treat any 2013 specified liability losses without regard to the special 10-year carryback rule. Free e file 2011 If you filed your original return on time but did not file the statement with it, you can make this choice on an amended return filed within 6 months after the due date of the return (excluding extensions). Free e file 2011 Attach a statement to your amended return and write “Filed pursuant to section 301. Free e file 2011 9100-2” at the top of the statement. Free e file 2011 Once made, this choice is irrevocable. Free e file 2011 Waiving the Carryback Period You can choose not to carry back your NOL. Free e file 2011 If you make this choice, then you can use your NOL only in the 20-year carryforward period. Free e file 2011 (This choice means you also choose not to carry back any alternative tax NOL. Free e file 2011 ) To make this choice, attach a statement to your original return filed by the due date (including extensions) for the NOL year. Free e file 2011 This statement must show that you are choosing to waive the carryback period under section 172(b)(3). Free e file 2011 If you filed your original return on time but did not file the statement with it, you can make this choice on an amended return filed within 6 months of the due date of the return (excluding extensions). Free e file 2011 Attach a statement to your amended return, and write “Filed pursuant to section 301. Free e file 2011 9100-2” at the top of the statement. Free e file 2011 Once you choose to waive the carryback period, it generally is irrevocable. Free e file 2011 If you choose to waive the carryback period for more than one NOL, you must make a separate choice and attach a separate statement for each NOL year. Free e file 2011 If you do not file this statement on time, you cannot waive the carryback period. Free e file 2011 How To Carry an NOL Back or Forward If you choose to carry back the NOL, you must first carry the entire NOL to the earliest carryback year. Free e file 2011 If your NOL is not used up, you can carry the rest to the next earliest carryback year, and so on. Free e file 2011 If you waive the carryback period or do not use up the NOL in the carryback period, carry forward what remains of the NOL to the 20 tax years following the NOL year. Free e file 2011 Start by carrying it to the first tax year after the NOL year. Free e file 2011 If you do not use it up, carry the unused part to the next year. Free e file 2011 Continue to carry any unused part of the NOL forward until the NOL is used up or you complete the 20-year carryforward period. Free e file 2011 Example 1. Free e file 2011 You started your business as a sole proprietor in 2013 and had a $42,000 NOL for the year. Free e file 2011 No part of the NOL qualifies for the 3-year, 5-year, or 10-year carryback. Free e file 2011 You begin using your NOL in 2011, the second year before the NOL year, as shown in the following chart. Free e file 2011 Year   Carryback/  Carryover Unused  Loss 2011 $42,000 $40,000 2012 40,000 37,000 2013 (NOL year)     2014 37,000 31,500 2015 31,500 22,500 2016 22,500 12,700 2017 12,700 4,000 2018 4,000 -0- If your loss were larger, you could carry it forward until the year 2033. Free e file 2011 If you still had an unused 2013 carryforward after the year 2033, you would not be allowed to deduct it. Free e file 2011 Example 2. Free e file 2011 Assume the same facts as in Example 1 , except that $4,000 of the NOL is attributable to a casualty loss and this loss qualifies for a 3-year carryback period. Free e file 2011 You begin using the $4,000 in 2010. Free e file 2011 As shown in the following chart, $3,000 of this NOL is used in 2010. Free e file 2011 The remaining $1,000 is carried to 2011 with the $38,000 NOL that you must begin using in 2011. Free e file 2011 Year   Carryback/  Carryover Unused  Loss 2010 $4,000 $1,000 2011 39,000 37,000 2012 37,000 34,000 2013 (NOL year)     2014 34,000 28,500 2015 28,500 19,500 2016 19,500 9,700 2017 9,700 1,000 2018 1,000 -0- How To Claim an NOL Deduction If you have not already carried the NOL to an earlier year, your NOL deduction is the total NOL. Free e file 2011 If you carried the NOL to an earlier year, your NOL deduction is the carried over NOL minus the NOL amount you used in the earlier year or years. Free e file 2011 If you carry more than one NOL to the same year, your NOL deduction is the total of these carrybacks and carryovers. Free e file 2011 NOL resulting in no taxable income. Free e file 2011   If your NOL is more than the taxable income of the year you carry it to (figured before deducting the NOL), you generally will have an NOL carryover to the next year. Free e file 2011 See How To Figure an NOL Carryover , later, to determine how much NOL you have used and how much you carry to the next year. Free e file 2011 Deducting a Carryback If you carry back your NOL, you can use either Form 1045 or Form 1040X. Free e file 2011 You can get your refund faster by using Form 1045, but you have a shorter time to file it. Free e file 2011 You can use Form 1045 to apply an NOL to all carryback years. Free e file 2011 If you use Form 1040X, you must use a separate Form 1040X for each carryback year to which you apply the NOL. Free e file 2011 Estates and trusts that do not file Form 1045 must file an amended Form 1041 (instead of Form 1040X) for each carryback year to which NOLs are applied. Free e file 2011 Use a copy of the appropriate year's Form 1041, check the “Amended return” box, and follow the Form 1041 instructions for amended returns. Free e file 2011 Include the NOL deduction with other deductions not subject to the 2% limit (line 15a). Free e file 2011 Also, see the special procedures for filing an amended return due to an NOL carryback, explained under Form 1040X , later. Free e file 2011 Form 1045. Free e file 2011   You can apply for a quick refund by filing Form 1045. Free e file 2011 This form results in a tentative adjustment of tax in the carryback year. Free e file 2011 See the Illustrated Form 1045 . Free e file 2011 at the end of this discussion. Free e file 2011   If the IRS refunds or credits an amount to you from Form 1045 and later determines that the refund or credit is too much, the IRS may assess and collect the excess immediately. Free e file 2011   Generally, you must file Form 1045 on or after the date you file your tax return for the NOL year, but not later than one year after the end of the NOL year. Free e file 2011 If the last day of the NOL year falls on a Saturday, Sunday, or holiday, the form will be considered timely if postmarked on the next business day. Free e file 2011 For example, if you are a calendar year taxpayer with a carryback from 2013 to 2011, you must file Form 1045 on or after the date you file your tax return for 2013, but no later than December 31, 2014. Free e file 2011 Form 1040X. Free e file 2011   If you do not file Form 1045, you can file Form 1040X to get a refund of tax because of an NOL carryback. Free e file 2011 File Form 1040X within 3 years after the due date, including extensions, for filing the return for the NOL year. Free e file 2011 For example, if you are a calendar year taxpayer and filed your 2011 return by the April 15, 2012, due date, you must file a claim for refund of 2008 tax because of an NOL carryback from 2011 by April 15, 2015. Free e file 2011   Attach a computation of your NOL using Form 1045, Schedule A, and, if it applies, your NOL carryover using Form 1045, Schedule B, discussed later . Free e file 2011 Refiguring your tax. Free e file 2011   To refigure your total tax liability for a carryback year, first refigure your adjusted gross income for that year. Free e file 2011 (On Form 1045, use lines 10 and 11 and the “After carryback” column for the applicable carryback year. Free e file 2011 ) Use your adjusted gross income after applying the NOL deduction to refigure income or deduction items that are based on, or limited to, a percentage of your adjusted gross income. Free e file 2011 Refigure the following items. Free e file 2011 The special allowance for passive activity losses from rental real estate activities. Free e file 2011 Taxable social security and tier 1 railroad retirement benefits. Free e file 2011 IRA deductions. Free e file 2011 Excludable savings bond interest. Free e file 2011 Excludable employer-provided adoption benefits. Free e file 2011 The student loan interest deduction. Free e file 2011 The tuition and fees deduction. Free e file 2011   If more than one of these items apply, refigure them in the order listed above, using your adjusted gross income after applying the NOL deduction and any previous item. Free e file 2011 (Enter your NOL deduction on Form 1045, line 10. Free e file 2011 On line 11, using the “After carryback” column, enter your adjusted gross income refigured after applying the NOL deduction and after refiguring any above items. Free e file 2011 )   Next, refigure your taxable income. Free e file 2011 (On Form 1045, use lines 12 through 15 and the “After carryback” column. Free e file 2011 ) Use your refigured adjusted gross income (Form 1045, line 11, using the “After carryback” column) to refigure certain deductions and other items that are based on or limited to a percentage of your adjusted gross income. Free e file 2011 Refigure the following items. Free e file 2011 The itemized deduction for medical expenses. Free e file 2011 The itemized deduction for qualified mortgage insurance premiums. Free e file 2011 The itemized deduction for casualty losses. Free e file 2011 Miscellaneous itemized deductions subject to the 2% limit. Free e file 2011 The overall limit on itemized deductions (do not apply to carryback years beginning after December 31, 2009). Free e file 2011 The phaseout of the deduction for exemptions (do not apply to carryback years beginning after December 31, 2009). Free e file 2011 Qualified motor vehicle tax (do not apply to carryback years beginning after December 31, 2009). Free e file 2011    Do not refigure the itemized deduction for charitable contributions. Free e file 2011   Finally, use your refigured taxable income (Form 1045, line 15, using the “After carryback” column) to refigure your total tax liability. Free e file 2011 Refigure your income tax, your alternative minimum tax, and any credits that are based on or limited by your adjusted gross income (AGI), modified adjusted gross income (MAGI), or tax liability. Free e file 2011 (On Form 1045, use lines 16 through 25, and the “After carryback” column. Free e file 2011 ) The earned income credit, for example, may be affected by changes to adjusted gross income or the amount of tax (or both) and, therefore, must be recomputed. Free e file 2011 If you become eligible for a credit because of the carryback, complete the form for that specific credit (such as the EIC Worksheet) for that year. Free e file 2011   While it is necessary to refigure your income tax, alternative minimum tax, and credits, do not refigure your self-employment tax. Free e file 2011 Deducting a Carryforward If you carry forward your NOL to a tax year after the NOL year, list your NOL deduction as a negative figure on the “Other income” line of Form 1040 or Form 1040NR (line 21 for 2013). Free e file 2011 Estates and trusts include an NOL deduction on Form 1041 with other deductions not subject to the 2% limit (line 15a for 2013). Free e file 2011 You must attach a statement that shows all the important facts about the NOL. Free e file 2011 Your statement should include a computation showing how you figured the NOL deduction. Free e file 2011 If you deduct more than one NOL in the same year, your statement must cover each of them. Free e file 2011 Change in Marital Status If you and your spouse were not married to each other in all years involved in figuring NOL carrybacks and carryovers, only the spouse who had the loss can take the NOL deduction. Free e file 2011 If you file a joint return, the NOL deduction is limited to the income of that spouse. Free e file 2011 For example, if your marital status changes because of death or divorce, and in a later year you have an NOL, you can carry back that loss only to the part of the income reported on the joint return (filed with your former spouse) that was related to your taxable income. Free e file 2011 After you deduct the NOL in the carryback year, the joint rates apply to the resulting taxable income. Free e file 2011 Refund limit. Free e file 2011   If you are not married in the NOL year (or are married to a different spouse), and in the carryback year you were married and filed a joint return, your refund for the overpaid joint tax may be limited. Free e file 2011 You can claim a refund for the difference between your share of the refigured tax and your contribution toward the tax paid on the joint return. Free e file 2011 The refund cannot be more than the joint overpayment. Free e file 2011 Attach a statement showing how you figured your refund. Free e file 2011 Figuring your share of a joint tax liability. Free e file 2011   There are five steps for figuring your share of the refigured joint tax liability. Free e file 2011 Figure your total tax as though you had filed as married filing separately. Free e file 2011 Figure your spouse's total tax as though your spouse had also filed as married filing separately. Free e file 2011 Add the amounts in (1) and (2). Free e file 2011 Divide the amount in (1) by the amount in (3). Free e file 2011 Multiply the refigured tax on your joint return by the amount figured in (4). Free e file 2011 This is your share of the joint tax liability. Free e file 2011 Figuring your contribution toward tax paid. Free e file 2011   Unless you have an agreement or clear evidence of each spouse's contributions toward the payment of the joint tax liability, figure your contribution by adding the tax withheld on your wages and your share of joint estimated tax payments or tax paid with the return. Free e file 2011 If the original return for the carryback year resulted in an overpayment, reduce your contribution by your share of the tax refund. Free e file 2011 Figure your share of a joint payment or refund by the same method used in figuring your share of the joint tax liability. Free e file 2011 Use your taxable income as originally reported on the joint return in steps (1) and (2) above, and substitute the joint payment or refund for the refigured joint tax in step (5). Free e file 2011 Change in Filing Status If you and your spouse were married and filed a joint return for each year involved in figuring NOL carrybacks and carryovers, figure the NOL deduction on a joint return as you would for an individual. Free e file 2011 However, treat the NOL deduction as a joint NOL. Free e file 2011 If you and your spouse were married and filed separate returns for each year involved in figuring NOL carrybacks and carryovers, the spouse who sustained the loss may take the NOL deduction on a separate return. Free e file 2011 Special rules apply for figuring the NOL carrybacks and carryovers of married people whose filing status changes for any tax year involved in figuring an NOL carryback or carryover. Free e file 2011 Separate to joint return. Free e file 2011   If you and your spouse file a joint return for a carryback or carryforward year, and were married but filed separate returns for any of the tax years involved in figuring the NOL carryback or carryover, treat the separate carryback or carryover as a joint carryback or carryover. Free e file 2011 Joint to separate returns. Free e file 2011   If you and your spouse file separate returns for a carryback or carryforward year, but filed a joint return for any or all of the tax years involved in figuring the NOL carryover, figure each of your carryovers separately. Free e file 2011 Joint return in NOL year. Free e file 2011   Figure each spouse's share of the joint NOL through the following steps. Free e file 2011 Figure each spouse's NOL as if he or she filed a separate return. Free e file 2011 See How To Figure an NOL , earlier. Free e file 2011 If only one spouse has an NOL, stop here. Free e file 2011 All of the joint NOL is that spouse's NOL. Free e file 2011 If both spouses have an NOL, multiply the joint NOL by a fraction, the numerator of which is spouse A's NOL figured in (1) and the denominator of which is the total of the spouses' NOLs figured in (1). Free e file 2011 The result is spouse A's share of the joint NOL. Free e file 2011 The rest of the joint NOL is spouse B's share. Free e file 2011 Example 1. Free e file 2011 Mark and Nancy are married and file a joint return for 2013. Free e file 2011 They have an NOL of $5,000. Free e file 2011 They carry the NOL back to 2011, a year in which Mark and Nancy filed separate returns. Free e file 2011 Figured separately, Nancy's 2013 deductions were more than her income, and Mark's income was more than his deductions. Free e file 2011 Mark does not have any NOL to carry back. Free e file 2011 Nancy can carry back the entire $5,000 NOL to her 2011 separate return. Free e file 2011 Example 2. Free e file 2011 Assume the same facts as in Example 1 , except that both Mark and Nancy had deductions in 2013 that were more than their income. Free e file 2011 Figured separately, his NOL is $1,800 and her NOL is $3,000. Free e file 2011 The sum of their separate NOLs ($4,800) is less than their $5,000 joint NOL because his deductions included a $200 net capital loss that is not allowed in figuring his separate NOL. Free e file 2011 The loss is allowed in figuring their joint NOL because it was offset by Nancy's capital gains. Free e file 2011 Mark's share of their $5,000 joint NOL is $1,875 ($5,000 × $1,800/$4,800) and Nancy's is $3,125 ($5,000 − $1,875). Free e file 2011 Joint return in previous carryback or carryforward year. Free e file 2011   If only one spouse had an NOL deduction on the previous year's joint return, all of the joint carryover is that spouse's carryover. Free e file 2011 If both spouses had an NOL deduction (including separate carryovers of a joint NOL, figured as explained in the previous discussion ), figure each spouse's share of the joint carryover through the following steps. Free e file 2011 Figure each spouse's modified taxable income as if he or she filed a separate return. Free e file 2011 See Modified taxable income under How To Figure an NOL Carryover , later. Free e file 2011 Multiply the joint modified taxable income you used to figure the joint carryover by a fraction, the numerator of which is spouse A's modified taxable income figured in (1) and the denominator of which is the total of the spouses' modified taxable incomes figured in (1). Free e file 2011 This is spouse A's share of the joint modified taxable income. Free e file 2011 Subtract the amount figured in (2) from the joint modified taxable income. Free e file 2011 This is spouse B's share of the joint modified taxable income. Free e file 2011 Reduce the amount figured in (3), but not below zero, by spouse B's NOL deduction. Free e file 2011 Add the amounts figured in (2) and (4). Free e file 2011 Subtract the amount figured in (5) from spouse A's NOL deduction. Free e file 2011 This is spouse A's share of the joint carryover. Free e file 2011 The rest of the joint carryover is spouse B's share. Free e file 2011 Example. Free e file 2011 Sam and Wanda filed a joint return for 2011 and separate returns for 2012 and 2013. Free e file 2011 In 2013, Sam had an NOL of $18,000 and Wanda had an NOL of $2,000. Free e file 2011 They choose to carry back both NOLs 2 years to their 2011 joint return and claim a $20,000 NOL deduction. Free e file 2011 Their joint modified taxable income (MTI) for 2011 is $15,000, and their joint NOL carryover to 2012 is $5,000 ($20,000 – $15,000). Free e file 2011 Sam and Wanda each figure their separate MTI for 2011 as if they had filed separate returns. Free e file 2011 Then they figure their shares of the $5,000 carryover as follows. Free e file 2011 Step 1. Free e file 2011   Sam's separate MTI $9,000 Wanda's separate MTI + 3,000 Total MTI $12,000 Step 2. Free e file 2011   Joint MTI $15,000 Sam's MTI ÷ total MTI ($9,000 ÷ $12,000) × . Free e file 2011 75 Sam's share of joint MTI $11,250 Step 3. Free e file 2011   Joint MTI $15,000 Sam's share of joint MTI − 11,250 Wanda's share of joint MTI $3,750 Step 4. Free e file 2011   Wanda's share of joint MTI $3,750 Wanda's NOL deduction − 2,000 Wanda's remaining share $1,750 Step 5. Free e file 2011   Sam's share of joint MTI $11,250 Wanda's remaining share + 1,750 Joint MTI to be offset $13,000 Step 6. Free e file 2011   Sam's NOL deduction $18,000 Joint MTI to be offset − 13,000 Sam's carryover to 2012 $5,000 Joint carryover to 2012 $5,000 Sam's carryover − 5,000 Wanda's carryover to 2012 $-0- Wanda's $2,000 NOL deduction offsets $2,000 of her $3,750 share of the joint modified taxable income and is completely used up. Free e file 2011 She has no carryover to 2012. Free e file 2011 Sam's $18,000 NOL deduction offsets all of his $11,250 share of joint modified taxable income and the remaining $1,750 of Wanda's share. Free e file 2011 His carryover to 2012 is $5,000. Free e file 2011 Illustrated Form 1045 The following example illustrates how to use Form 1045 to claim an NOL deduction in a carryback year. Free e file 2011 It includes a filled-in page 1 of Form 1045. Free e file 2011 Example. Free e file 2011 Martha Sanders is a self-employed contractor. Free e file 2011 Martha's 2013 deductions are more than her 2013 income because of a business loss. Free e file 2011 She uses Form 1045 to carry back her NOL 2 years and claim an NOL deduction in 2011. Free e file 2011 Her filing status in both years was single. Free e file 2011 See the filled-in Form 1045 later. Free e file 2011 Martha figures her 2013 NOL on Form 1045, Schedule A (not shown). Free e file 2011 (For an example using Form 1045, Schedule A, see Illustrated Form 1045, Schedule A under How To Figure an NOL , earlier. Free e file 2011 ) She enters the $10,000 NOL from Form 1045, Schedule A, line 25, on Form 1045, line 1a. Free e file 2011 Martha completes lines 10 through 25, using the “Before carryback” column under the column for the second preceding tax year ended 12/31/11 on page 1 of Form 1045 using the following amounts from her 2011 return. Free e file 2011 2011 Adjusted gross income $50,000 Itemized deductions:     Medical expenses [$6,000 − ($50,000 × 7. Free e file 2011 5%)] $2,250   State income tax + 2,000   Real estate tax + 4,000   Home mortgage interest + 5,000   Total itemized deductions $13,250 Exemption $3,700 Income tax $4,550 Self-employment tax $6,120   Martha refigures her taxable income for 2011 after carrying back her 2013 NOL as follows: 2011 Adjusted gross income $50,000 Less:     NOL from 2013 −10,000 2011 Adjusted gross income after carryback $40,000 Less:     Itemized deductions:     Medical expenses [$6,000 − ($40,000 × 7. Free e file 2011 5%)] $3,000   State income tax + 2,000   Real estate tax + 4,000   Home mortgage interest + 5,000   Total itemized deductions −14,000 Less:     Exemption − 3,700 2011 Taxable income after carryback $22,300 Martha then completes lines 10 through 25, using the “After carryback” column under the column for the second preceding tax year ended 12/31/11. Free e file 2011 On line 10, Martha enters her $10,000 NOL deduction. Free e file 2011 Her new adjusted gross income on line 11 is $40,000 ($50,000 − $10,000). Free e file 2011 To complete line 12, she must refigure her medical expense deduction using her new adjusted gross income. Free e file 2011 Her refigured medical expense deduction is $3,000 [$6,000 − ($40,000 × 7. Free e file 2011 5%)]. Free e file 2011 This increases her total itemized deductions to $14,000 [$13,250 + ($3,000 − $2,250)]. Free e file 2011 Martha uses her refigured taxable income ($22,300) from line 15, and the tax tables in her 2011 Form 1040 instructions to find her income tax. Free e file 2011 She enters the new amount, $2,924, on line 16, and her new total tax liability, $9,044, on line 25. Free e file 2011 Martha used up her $10,000 NOL in 2011 so she does not complete a column for the first preceding tax year ended 12/31/2012. Free e file 2011 The decrease in tax because of her NOL deduction (line 27) is $1,612. Free e file 2011 Martha files Form 1045 after filing her 2013 return, but no later than December 31, 2014. Free e file 2011 She mails it to the Internal Revenue Service Center for the place where she lives as shown in the 2013 instructions for Form 1040 and attaches a copy of her 2013 return (including the applicable forms and schedules). Free e file 2011 This image is too large to be displayed in the current screen. Free e file 2011 Please click the link to view the image. Free e file 2011 Form 1045, page 1 How To Figure an NOL Carryover If your NOL is more than your taxable income for the year to which you carry it (figured before deducting the NOL), you may have an NOL carryover. Free e file 2011 You must make certain modifications to your taxable income to determine how much NOL you will use up in that year and how much you can carry over to the next tax year. Free e file 2011 Your carryover is the excess of your NOL deduction over your modified taxable income for the carryback or carryforward year. Free e file 2011 If your NOL deduction includes more than one NOL, apply the NOLs against your modified taxable income in the same order in which you incurred them, starting with the earliest. Free e file 2011 Modified taxable income. Free e file 2011   Your modified taxable income is your taxable income figured with the following changes. Free e file 2011 You cannot claim an NOL deduction for the NOL carryover you are figuring or for any later NOL. Free e file 2011 You cannot claim a deduction for capital losses in excess of your capital gains. Free e file 2011 Also, you must increase your taxable income by the amount of any section 1202 exclusion. Free e file 2011 You cannot claim the domestic production activities deduction. Free e file 2011 You cannot claim a deduction for your exemptions for yourself, your spouse, or dependents. Free e file 2011 You must figure any item affected by the amount of your adjusted gross income after making the changes in (1), (2), and (3), above, and certain other changes to your adjusted gross income that result from (1), (2), and (3). Free e file 2011 This includes income and deduction items used to figure adjusted gross income (for example, IRA deductions), as well as certain itemized deductions. Free e file 2011 To figure a charitable contribution deduction, do not include deductions for NOL carrybacks in the change in (1) but do include deductions for NOL carryforwards from tax years before the NOL year. Free e file 2011   Your taxable income as modified cannot be less than zero. Free e file 2011 Form 1045, Schedule B. Free e file 2011   You can use Form 1045, Schedule B, to figure your modified taxable income for carryback years and your carryover from each of those years. Free e file 2011 Do not use Form 1045, Schedule B, for a carryforward year. Free e file 2011 If your 2013 return includes an NOL deduction from an NOL year before 2013 that reduced your taxable income to zero (to less than zero, if an estate or trust), see NOL Carryover From 2013 to 2014 , later. Free e file 2011 Illustrated Form 1045, Schedule B The following example illustrates how to figure an NOL carryover from a carryback year. Free e file 2011 It includes a filled-in Form 1045, Schedule B. Free e file 2011 Example. Free e file 2011 Ida Brown runs a small clothing shop. Free e file 2011 In 2013, she has an NOL of $36,000 that she carries back to 2011. Free e file 2011 She has no other carrybacks or carryforwards to 2011. Free e file 2011 Ida's adjusted gross income in 2011 was $35,000, consisting of her salary of $36,000 minus a $1,000 capital loss deduction. Free e file 2011 She is single and claimed only one personal exemption of $3,700. Free e file 2011 During that year, she gave $1,450 in charitable contributions. Free e file 2011 Her medical expenses were $3,000. Free e file 2011 She also deducted $1,650 in taxes and $3,125 in home mortgage interest. Free e file 2011 Her deduction for charitable contributions was not limited because her contributions, $1,450, were less than 50% of her adjusted gross income. Free e file 2011 The deduction for medical expenses was limited to expenses over 7. Free e file 2011 5% of adjusted gross income (. Free e file 2011 075 × $35,000 = $2,625; $3,000 − $2,625 = $375). Free e file 2011 The deductions for taxes and home mortgage interest were not subject to any limits. Free e file 2011 She was able to claim $6,600 ($1,450 + $375 + $1,650 + $3,125) in itemized deductions and a personal exemption deduction of $3,700 for 2011. Free e file 2011 She had no other deductions in 2011 (except the NOL deduction). Free e file 2011 Her taxable income (figured without the NOL deduction) for the year was $24,700. Free e file 2011 Ida's adjusted gross income in 2012 was $9,325, consisting of net business income from the clothing shop of $12,325 and a net capital loss of $3,000. Free e file 2011 She did not itemize her deductions in 2012. Free e file 2011 She deducted the standard deduction of $5,950 and the personal exemption deduction of $3,800. Free e file 2011 She had no other deductions in 2012 (other than the NOL deduction). Free e file 2011 Her taxable income, therefore, was ($425). Free e file 2011 Ida's $36,000 carryback will result in her having 2011 taxable income of zero. Free e file 2011 She then completes the column for the second preceding tax year ended 12/31/11 on Form 1045, Schedule B, to figure how much of her NOL she uses up in 2011 and how much she can carry over to 2012. Free e file 2011 She completes the column for the first preceding tax year ended 12/31/12. Free e file 2011 See the illustrated Form 1045, Schedule B , shown later. Free e file 2011 Column 1, line 1. Free e file 2011 Ida enters $36,000, her 2013 net operating loss, on line 1. Free e file 2011 Column 1, line 2. Free e file 2011 She enters $24,700, her 2011 taxable income (figured without the NOL deduction), on line 2. Free e file 2011 Column 1, line 3. Free e file 2011 Ida enters her net capital loss deduction of $1,000 on line 3. Free e file 2011 Column 1, lines 4 and 5. Free e file 2011 Ida had no section 1202 exclusion or domestic production activities deduction in 2011. Free e file 2011 She enters zero on lines 4 and 5. Free e file 2011 Column 1, line 6. Free e file 2011 Although Ida's entry on line 3 modifies her adjusted gross income, that does not affect any other items included in her adjusted gross income. Free e file 2011 Ida enters zero on line 6. Free e file 2011 Column 1, line 7. Free e file 2011 Ida had itemized deductions and entered $1,000 on line 3, so she completes lines 11 through 38 to figure her adjustment to itemized deductions. Free e file 2011 On line 7, she enters the total adjustment from line 38. Free e file 2011 Column 1, line 8. Free e file 2011 Ida enters the deduction for her personal exemption of $3,700 for 2011. Free e file 2011 Column 1, line 9. Free e file 2011 After combining lines 2 through 8, Ida's modified taxable income is $29,475. Free e file 2011 Column 1, line 10. Free e file 2011 Ida figures her carryover to 2012 by subtracting her modified taxable income (line 9) from her NOL deduction (line 1). Free e file 2011 She enters the $6,525 carryover on line 10. Free e file 2011 She also enters the $6,525 as her NOL deduction for 2012 on Form 1045, page 1, line 10, in the “After carryback” column under the column for the first preceding tax year ended 12/31/12. Free e file 2011 (For an illustrated example of page 1 of Form 1045, see Illustrated Form 1045 under How To Claim an NOL Deduction , earlier. Free e file 2011 ) Next, Ida completes column 2 for the first preceding tax year ended 12/31/12. Free e file 2011 Column 1, line 11. Free e file 2011 Ida's adjusted gross income for 2011 was $35,000. Free e file 2011 Column 1, line 12. Free e file 2011 She adds lines 3 through 6 and enters $1,000 on line 12. Free e file 2011 (This is her net capital loss deduction added back, which modifies her adjusted gross income. Free e file 2011 ) Column 1, line 13. Free e file 2011 Her modified adjusted gross income for 2011 is now $36,000. Free e file 2011 Column 1, line 14. Free e file 2011 On her 2011 tax return, she deducted $375 as medical expenses. Free e file 2011 Column 1, line 15. Free e file 2011 Her actual medical expenses were $3,000. Free e file 2011 Column 1, line 16. Free e file 2011 She multiplies her modified adjusted gross income, $36,000, by . Free e file 2011 075. Free e file 2011 She enters $2,700 on line 16. Free e file 2011 Column 1, line 17. Free e file 2011 She substracts $2,700 from her actual medical expenses, $3,000. Free e file 2011 She enters $300 on line 17. Free e file 2011 This is her modified medical deduction. Free e file 2011 Column 1, line 18. Free e file 2011 The difference between her medical deduction and her modified medical deduction is $75. Free e file 2011 She enters this on line 18. Free e file 2011 Column 1, lines 19 through 21. Free e file 2011 Ida had no deduction for qualified mortgage insurance premiums in 2011. Free e file 2011 She skips lines 19 and 20 and enters zero on line 21. Free e file 2011 Column 1, line 22. Free e file 2011 She enters her modified adjusted gross income of $36,000 on line 22. Free e file 2011 Column 1, line 23. Free e file 2011 She had no other carrybacks to 2011 and enters zero on line 23. Free e file 2011 Column 1, line 24. Free e file 2011 Her modified adjusted gross income remains $36,000. Free e file 2011 Column 1, line 25. Free e file 2011 Her actual contributions for 2011 were $1,450, which she enters on line 25. Free e file 2011 Column 1, line 26. Free e file 2011 She now refigures her charitable contributions based on her modified adjusted gross income. Free e file 2011 Her contributions are well below the 50% limit, so she enters $1,450 on line 26. Free e file 2011 Column 1, line 27. Free e file 2011 The difference is zero. Free e file 2011 Column 1, lines 28 through 37. Free e file 2011 Ida had no casualty losses or deductions for miscellaneous items in 2011. Free e file 2011 She skips lines 28 through 31 and lines 33 through 36. Free e file 2011 Ida enters zero on lines 32 and 37. Free e file 2011 Column 1, line 38. Free e file 2011 She combines lines 18, 21, 27, 32, and 37 and enters $75 on line 38. Free e file 2011 She carries this figure to line 7. Free e file 2011 Column 2, line 1. Free e file 2011 Ida enters $6,525, the carryback of her 2013 NOL to 2012, from column 1, line 10, on line 1. Free e file 2011 Column 2, line 2. Free e file 2011 She enters ($425), her 2012 taxable income, on line 2. Free e file 2011 Column 2, line 3. Free e file 2011 Ida enters her net capital loss deduction of $3,000 on line 3. Free e file 2011 Column 2, lines 4 and 5. Free e file 2011 Ida had no section 1202 exclusion or domestic production activities deduction in 2012. Free e file 2011 She enters zero on lines 4 and 5. Free e file 2011 Column 2, line 6. Free e file 2011 Although Ida's entry on line 3 modifies her adjusted gross income, that does not affect any other items included in her adjusted gross income. Free e file 2011 Ida enters zero on line 6. Free e file 2011 Column 2, line 7. Free e file 2011 Because Ida did not itemize deductions on her 2012 tax return, she enters zero on line 7. Free e file 2011 Column 2, line 8. Free e file 2011 Ida enters the deduction for her personal exemption of $3,800 for 2012. Free e file 2011 Column 2, line 9. Free e file 2011 After combining lines 2 through 8, Ida's modified taxable income is $6,375. Free e file 2011 Column 2, line 10. Free e file 2011 Ida figures her carryforward to 2014 by subtracting her modified taxable income (line 9) from her NOL deduction (line 1). Free e file 2011 She enters the $150 carryover on line 10. Free e file 2011 This image is too large to be displayed in the current screen. Free e file 2011 Please click the link to view the image. Free e file 2011 Form 1045, page 3 This image is too large to be displayed in the current screen. Free e file 2011 Please click the link to view the image. Free e file 2011 Form 1045, page 4 NOL Carryover From 2013 to 2014 If you had an NOL deduction carried forward from a year prior to 2013 that resulted in your having taxable income on your 2013 return of zero (of less than zero, if an estate or trust), complete Table 1 , Worksheet for NOL Carryover From 2013 to 2014, on the following pages. Free e file 2011 It will help you figure your NOL to carry to 2014. Free e file 2011 Keep the worksheet for your records. Free e file 2011 Worksheet Instructions At the top of the worksheet, enter the NOL year for which you are figuring the carryover. Free e file 2011 More than one NOL. Free e file 2011   If your 2013 NOL deduction includes amounts for more than one loss year, complete this worksheet only for one loss year. Free e file 2011 To determine which year, start with your earliest NOL and subtract each NOL separately from your taxable income figured without the NOL deduction. Free e file 2011 Complete this worksheet for the earliest NOL that results in your having taxable income below zero. Free e file 2011 Your NOL carryover to 2014 is the total of the amount on line 10 of the worksheet and all later NOL amounts. Free e file 2011 Example. Free e file 2011 Your taxable income for 2013 is $5,000 without your $9,000 NOL deduction. Free e file 2011 Your NOL deduction includes a $2,000 carryover from 2011 and a $7,000 carryover from 2012. Free e file 2011 Subtract your 2011 NOL of $2,000 from $5,000. Free e file 2011 This gives you taxable income of $3,000. Free e file 2011 Your 2011 NOL is now completely used up. Free e file 2011 Subtract your $7,000 2012 NOL from $3,000. Free e file 2011 This gives you taxable income of ($4,000). Free e file 2011 You now complete the worksheet for your 2012 NOL. Free e file 2011 Your NOL carryover to 2014 is the unused part of your 2012 NOL from line 10 of the worksheet. Free e file 2011 Line 2. Free e file 2011   Treat your NOL deduction for the NOL year entered at the top of the worksheet and later years as a positive amount. Free e file 2011 Add it to your negative taxable income (figured without the NOL deduction). Free e file 2011 Enter the result on line 2. Free e file 2011 Line 6. Free e file 2011   You must refigure the following income and deductions based on adjusted gross income. Free e file 2011 The special allowance for passive activity losses from rental real estate activities. Free e file 2011 Taxable social security and tier 1 railroad retirement benefits. Free e file 2011 IRA deductions. Free e file 2011 Excludable savings bond interest. Free e file 2011 Excludable employer-provided adoption benefits. Free e file 2011 The student loan interest deduction. Free e file 2011 The tuition and fees deduction. Free e file 2011   If none of these items apply to you, enter zero on line 6. Free e file 2011 Otherwise, increase your adjusted gross income by the total of lines 3 through 5 and your NOL deduction for the NOL year entered at the top of the worksheet and later years. Free e file 2011 Using this increased adjusted gross income, refigure the items that apply, in the order listed above. Free e file 2011 Your adjustment for each item is the difference between the refigured amount and the amount included on your return. Free e file 2011 Combine the adjustments for previous items with your adjusted gross income before refiguring the next item. Free e file 2011 Keep a record of your computations. Free e file 2011   Enter your total adjustments for the above items on line 6. Free e file 2011 Line 7. Free e file 2011   Enter zero if you claimed the standard deduction or the amounts on lines 3 through 5 are zero. Free e file 2011 Otherwise, use lines 11 through 33 of the worksheet to figure the amount to enter on this line. Free e file 2011 Complete only those sections that apply to you. Free e file 2011 Estates and trusts. Free e file 2011   Enter zero on line 7 if you did not claim any miscellaneous deductions on Form 1041, line 15c, or a casualty or theft loss. Free e file 2011 Otherwise, refigure these deductions by substituting modified adjusted gross income (see below ) for adjusted gross income. Free e file 2011 Subtract the recomputed deductions from those claimed on the return. Free e file 2011 Enter the result on line 7. Free e file 2011 Modified adjusted gross income. Free e file 2011   To refigure miscellaneous itemized deductions of an estate or trust (Form 1041, line 15c), modified adjusted gross income is the total of the following amounts. Free e file 2011 The adjusted gross income on the return. Free e file 2011 The amounts from lines 3 through 5 of the worksheet. Free e file 2011 The exemption amount from Form 1041, line 20. Free e file 2011 The NOL deduction for the NOL year entered at the top of the worksheet and for later years. Free e file 2011   To refigure the casualty and theft loss deduction of an estate or trust, modified adjusted gross income is the total of the following amounts. Free e file 2011 The adjusted gross income amount you used to figure the deduction claimed on the return. Free e file 2011 The amounts from lines 3 through 5 of the worksheet. Free e file 2011 The NOL deduction for the NOL year entered at the top of the worksheet and for later years. Free e file 2011 Line 11. Free e file 2011   Treat your NOL deduction for the NOL year entered at the top of the worksheet and for later years as a positive amount. Free e file 2011 Add it to your adjusted gross income. Free e file 2011 Enter the result on line 11. Free e file 2011 Line 20. Free e file 2011   Is your modified adjusted gross income from line 13 of this worksheet more than $100,000 ($50,000 if married filing separately)?   □ Yes. Free e file 2011 Your deduction is limited. Free e file 2011 Refigure your deduction using the Mortgage Insurance Premiums Deduction Worksheet in the 2013 Instructions for Form 1045. Free e file 2011 On line 2 of the Mortgage Insurance Premiums Deduction Worksheet, enter the amount from line 13 of this worksheet. Free e file 2011   □ No. Free e file 2011 Your deduction is not limited. Free e file 2011 Enter the amount from line 19 on line 20 and enter -0- on line 21. Free e file 2011 Line 23. Free e file 2011   If you had a contributions carryover from 2012 to 2013 and your NOL deduction includes an amount from an NOL year before 2012, you may have to reduce your contributions carryover. Free e file 2011 Reduce the contributions carryover by the amount of any adjustment you made to your 2012 charitable contributions deduction when figuring your NOL carryover to 2013. Free e file 2011 Use the reduced contributions carryover to figure the amount to enter on line 23. Free e file 2011 Please click here for the text description of the image. Free e file 2011 Worksheet for NOL Carryover Worksheet for NOL Carryover (Continued) How To Get Tax Help Whether it's help with a tax issue, preparing your tax return or a need for a free publication or form, get the help you need the way you want it: online, use a smart phone, call or walk in to an IRS office or volunteer site near you. Free e file 2011 Free help with your tax return. Free e file 2011   You can get free help preparing your return nationwide from IRS-certified volunteers. Free e file 2011 The Volunteer Income Tax Assistance (VITA) program helps low-to-moderate income, elderly, people with disabilities, and limited English proficient taxpayers. Free e file 2011 The Tax Counseling for the Elderly (TCE) program helps taxpayers age 60 and older with their tax returns. Free e file 2011 Most VITA and TCE sites offer free electronic filing and all volunteers will let you know about credits and deductions you may be entitled to claim. Free e file 2011 In addition, some VITA and TCE sites provide taxpayers the opportunity to prepare their own return with help from an IRS-certified volunteer. Free e file 2011 To find the nearest VITA or TCE site, you can use the VITA Locator Tool on IRS. Free e file 2011 gov, download the IRS2Go app, or call 1-800-906-9887. Free e file 2011   As part of the TCE program, AARP offers the Tax-Aide counseling program. Free e file 2011 To find the nearest AARP Tax-Aide site, visit AARP's website at www. Free e file 2011 aarp. Free e file 2011 org/money/taxaide or call 1-888-227-7669. Free e file 2011 For more information on these programs, go to IRS. Free e file 2011 gov and enter “VITA” in the search box. Free e file 2011 Internet. Free e file 2011    IRS. Free e file 2011 gov and IRS2Go are ready when you are —24 hours a day, 7 days a week. Free e file 2011 Download the free IRS2Go app from the iTunes app store or from Google Play. Free e file 2011 Use it to check your refund status, order transcripts of your tax returns or tax account, watch the IRS YouTube channel, get IRS news as soon as it's released to the public, subscribe to filing season updates or daily tax tips, and follow the IRS Twitter news feed, @IRSnews, to get the latest federal tax news, including information about tax law changes and important IRS programs. Free e file 2011 Check the status of your 2013 refund with the Where's My Refund? application on IRS. Free e file 2011 gov or download the IRS2Go app and select the Refund Status option. Free e file 2011 The IRS issues more than 9 out of 10 refunds in less than 21 days. Free e file 2011 Using these applications, you can start checking on the status of your return within 24 hours after we receive your e-filed return or 4 weeks after you mail a paper return. Free e file 2011 You will also be given a personalized refund date as soon as the IRS processes your tax return and approves your refund. Free e file 2011 The IRS updates Where's My Refund? every 24 hours, usually overnight, so you only need to check once a day. Free e file 2011 Use the Interactive Tax Assistant (ITA) to research your tax questions. Free e file 2011 No need to wait on the phone or stand in line. Free e file 2011 The ITA is available 24 hours a day, 7 days a week, and provides you with a variety of tax information related to general filing topics, deductions, credits, and income. Free e file 2011 When you reach the response screen, you can print the entire interview and the final response for your records. Free e file 2011 New subject areas are added on a regular basis. Free e file 2011  Answers not provided through ITA may be found in Tax Trails, one of the Tax Topics on IRS. Free e file 2011 gov which contain general individual and business tax information or by searching the IRS Tax Map, which includes an international subject index. Free e file 2011 You can use the IRS Tax Map to search publications and instructions by topic or keyword. Free e file 2011 The IRS Tax Map integrates forms and publications into one research tool and provides single-point access to tax law information by subject. Free e file 2011 When the user searches the IRS Tax Map, they will be provided with links to related content in existing IRS publications, forms and instructions, questions and answers, and Tax Topics. Free e file 2011 Coming this filing season, you can immediately view and print for free all 5 types of individual federal tax transcripts (tax returns, tax account, record of account, wage and income statement, and certification of non-filing) using Get Transcript. Free e file 2011 You can also ask the IRS to mail a return or an account transcript to you. Free e file 2011 Only the mail option is available by choosing the Tax Records option on the IRS2Go app by selecting Mail Transcript on IRS. Free e file 2011 gov or by calling 1-800-908-9946. Free e file 2011 Tax return and tax account transcripts are generally available for the current year and the past three years. Free e file 2011 Determine if you are eligible for the EITC and estimate the amount of the credit with the Earned Income Tax Credit (EITC) Assistant. Free e file 2011 Visit Understanding Your IRS Notice or Letter to get answers to questions about a notice or letter you received from the IRS. Free e file 2011 If you received the First Time Homebuyer Credit, you can use the First Time Homebuyer Credit Account Look-up tool for information on your repayments and account balance. Free e file 2011 Check the status of your amended return using Where's My Amended Return? Go to IRS. Free e file 2011 gov and enter Where's My Amended Return? in the search box. Free e file 2011 You can generally expect your amended return to be processed up to 12 weeks from the date we receive it. Free e file 2011 It can take up to 3 weeks from the date you mailed it to show up in our system. Free e file 2011 Make a payment using one of several safe and convenient electronic payment options available on IRS. Free e file 2011 gov. Free e file 2011 Select the Payment tab on the front page of IRS. Free e file 2011 gov for more information. Free e file 2011 Determine if you are eligible and apply for an online payment agreement, if you owe more tax than you can pay today. Free e file 2011 Figure your income tax withholding with the IRS Withholding Calculator on IRS. Free e file 2011 gov. Free e file 2011 Use it if you've had too much or too little withheld, your personal situation has changed, you're starting a new job or you just want to see if you're having the right amount withheld. Free e file 2011 Determine if you might be subject to the Alternative Minimum Tax by using the Alternative Minimum Tax Assistant on IRS. Free e file 2011 gov. Free e file 2011 Request an Electronic Filing PIN by going to IRS. Free e file 2011 gov and entering Electronic Filing PIN in the search box. Free e file 2011 Download forms, instructions and publications, including accessible versions for people with disabilities. Free e file 2011 Locate the nearest Taxpayer Assistance Center (TAC) using the Office Locator tool on IRS. Free e file 2011 gov, or choose the Contact Us option on the IRS2Go app and search Local Offices. Free e file 2011 An employee can answer questions about your tax account or help you set up a payment plan. Free e file 2011 Before you visit, check the Office Locator on IRS. Free e file 2011 gov, or Local Offices under Contact Us on IRS2Go to confirm the address, phone number, days and hours of operation, and the services provided. Free e file 2011 If you have a special need, such as a disability, you can request an appointment. Free e file 2011 Call the local number listed in the Office Locator, or look in the phone book under United States Government, Internal Revenue Service. Free e file 2011 Apply for an Employer Identification Number (EIN). Free e file 2011 Go to IRS. Free e file 2011 gov and enter Apply for an EIN in the search box. Free e file 2011 Read the Internal Revenue Code, regulations, or other official guidance. Free e file 2011 Read Internal Revenue Bulletins. Free e file 2011 Sign up to receive local and national tax news and more by email. Free e file 2011 Just click on “subscriptions” above the search box on IRS. Free e file 2011 gov and choose from a variety of options. Free e file 2011 Phone. Free e file 2011    You can call the IRS, or you can carry it in your pocket with the IRS2Go app on your smart phone or tablet. Free e file 2011 Download the free IRS2Go app from the iTunes app store or from Google Play. Free e file 2011 Call to locate the nearest volunteer help site, 1-800-906-9887 or you can use the VITA Locator Tool on IRS. Free e file 2011 gov, or download the IRS2Go app. Free e file 2011 Low-to-moderate income, elderly, people with disabilities, and limited English proficient taxpayers can get free help with their tax return from the nationwide Volunteer Income Tax Assistance (VITA) program. Free e file 2011 The Tax Counseling for the Elderly (TCE) program helps taxpayers age 60 and older with their tax returns. Free e file 2011 Most VITA and TCE sites offer free electronic filing. Free e file 2011 Some VITA and TCE sites provide IRS-certified volunteers who can help prepare your tax return. Free e file 2011 Through the TCE program, AARP offers the Tax-Aide counseling program; call 1-888-227-7669 to find the nearest Tax-Aide location. Free e file 2011 Call the automated Where's My Refund? information hotline to check the status of your 2013 refund 24 hours a day, 7 days a week at 1-800-829-1954. Free e file 2011 If you e-file, you can start checking on the status of your return within 24 hours after the IRS receives your tax return or 4 weeks after you've mailed a paper return. Free e file 2011 The IRS issues more than 9 out of 10 refunds in less than 21 days. Free e file 2011 Where's My Refund? will give you a personalized refund date as soon as the IRS processes your tax return and approves your refund. Free e file 2011 Before you call this automated hotline, have your 2013 tax return handy so you can enter your social security number, your filing status, and the exact whole dollar amount of your refund. Free e file 2011 The IRS updates Where's My Refund? every 24 hours, usually overnight, so you only need to check once a day. Free e file 2011 Note, the above information is for our automated hotline. Free e file 2011 Our live phone and walk-in assistors can research the status of your refund only if it's been 21 days or more since you filed electronically or more than 6 weeks since you mailed your paper return. Free e file 2011 Call the Amended Return Hotline, 1-866-464-2050, to check the status of your amended return. Free e file 2011 You can generally expect your amended return to be processed up to 12 weeks from the date we receive it. Free e file 2011 It can take up to 3 weeks from the date you mailed it to show up in our system. Free e file 2011 Call 1-800-TAX-FORM (1-800-829-3676) to order current-year forms, instructions, publications, and prior-year forms and instructions (limited to 5 years). Free e file 2011 You should receive your order within 10 business days. Free e file 2011 Call TeleTax, 1-800-829-4477, to listen to pre-recorded messages covering general and business tax information. Free e file 2011 If, between January and April 15, you still have questions about the Form 1040, 1040A, or 1040EZ (like filing requirements, dependents, credits, Schedule D, pensions and IRAs or self-employment taxes), call 1-800-829-1040. Free e file 2011 Call using TTY/TDD equipment, 1-800-829-4059 to ask tax questions or order forms and publications. Free e file 2011 The TTY/TDD telephone number is for people who are deaf, hard of hearing, or have a speech disability. Free e file 2011 These individuals can also contact the IRS through relay services such as the Federal Relay Service. Free e file 2011 Walk-in. Free e file 2011   You can find a selection of forms, publications and services — in person. Free e file 2011 Products. Free e file 2011 You can walk in to some post offices, libraries, and IRS offices to pick up certain forms, instructions, and publications. Free e file 2011 Some IRS offices, libraries, and city and county government offices have a collection of products available to photocopy from reproducible proofs. Free e file 2011 Services. Free e file 2011 You can walk in to your local TAC for face-to-face tax help. Free e file 2011 An employee can answer questions about your tax account or help you set up a payment plan. Free e file 2011 Before visiting, use the Office Locator tool on IRS. Free e file 2011 gov, or choose the Contact Us option on the IRS2Go app and search Local Offices for days and hours of operation, and services provided. Free e file 2011 Mail. Free e file 2011   You can send your order for forms, instructions, and publications to the address below. Free e file 2011 You should receive a response within 10 business days after your request is received. Free e file 2011 Internal Revenue Service 1201 N. Free e file 2011 Mitsubishi Motorway Bloomington, IL 61705-6613    The Taxpayer Advocate Service Is Here to Help You. Free e file 2011 The Taxpayer Advocate Service (TAS) is your voice at the IRS. Free e file 2011 Our job is to ensure that every taxpayer is treated fairly and that you know and understand your rights. Free e file 2011   What can TAS do for you? We can offer you free help with IRS problems that you can't resolve on your own. Free e file 2011 We know this process can be confusing, but the worst thing you can do is nothing at all! TAS can help if you can't resolve your tax problem and: Your problem is causing financial difficulties for you, your family, or your business. Free e file 2011 You face (or your business is facing) an immediate threat of adverse action. Free e file 2011 You've tried repeatedly to contact the IRS but no one has responded, or the IRS hasn't responded by the date promised. Free e file 2011   If you qualify for our help, you'll be assigned to one advocate who'll be with you at every turn and will do everything possible to resolve your problem. Free e file 2011 Here's why we can help: TAS is an independent organization within the IRS. Free e file 2011 Our advocates know how to work with the IRS. Free e file 2011 Our services are free and tailored to meet your needs. Free e file 2011 We have offices in every state, the District of Columbia, and Puerto Rico. Free e file 2011   How can you reach us? If you think TAS can help you, call your local advocate, whose number is in your local directory and at Taxpayer Advocate, or call us toll-free at 1-877-777-4778. Free e file 2011   How else does TAS help taxpayers?  TAS also works to resolve large-scale, systemic problems that affect many taxpayers. Free e file 2011 If you know of one of these broad issues, please report it to us through our Systemic Advocacy Management System. Free e file 2011 Low Income Taxpayer Clinics Low Income