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Free File 2011 Taxes

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Free File 2011 Taxes

Free file 2011 taxes 21. Free file 2011 taxes   Medical and Dental Expenses Table of Contents What's New Introduction Useful Items - You may want to see: What Are Medical Expenses? What Expenses Can You Include This Year?Community property states. Free file 2011 taxes How Much of the Expenses Can You Deduct? Whose Medical Expenses Can You Include?Yourself Spouse Dependent Decedent What Medical Expenses Are Includible?Insurance Premiums Meals and Lodging Transportation Disabled Dependent Care Expenses How Do You Treat Reimbursements?Insurance Reimbursement Damages for Personal Injuries How Do You Figure and Report the Deduction on Your Tax Return?What Tax Form Do You Use? Impairment-Related Work Expenses Health Insurance Costs for Self-Employed Persons What's New Medical and dental expenses. Free file 2011 taxes  Beginning January 1, 2013, you can deduct only the part of your medical and dental expenses that exceed 10% of your adjusted gross income (AGI) (7. Free file 2011 taxes 5% if either you or your spouse is age 65 or older). Free file 2011 taxes Standard mileage rate. Free file 2011 taxes  The standard mileage rate allowed for operating expenses for a car when you use it for medical reasons is 24 cents per mile. Free file 2011 taxes See Transportation under What Medical Expenses Are Includible. Free file 2011 taxes Introduction This chapter will help you determine the following. Free file 2011 taxes What medical expenses are. Free file 2011 taxes What expenses you can include this year. Free file 2011 taxes How much of the expenses you can deduct. Free file 2011 taxes Whose medical expenses you can include. Free file 2011 taxes What medical expenses are includible. Free file 2011 taxes How to treat reimbursements. Free file 2011 taxes How to report the deduction on your tax return. Free file 2011 taxes How to report impairment-related work expenses. Free file 2011 taxes How to report health insurance costs if you are self-employed. Free file 2011 taxes Useful Items - You may want to see: Publications 502 Medical and Dental Expenses 969 Health Savings Accounts and Other Tax-Favored Health Plans Form (and Instructions) Schedule A (Form 1040) Itemized Deductions What Are Medical Expenses? Medical expenses are the costs of diagnosis, cure, mitigation, treatment, or prevention of disease, and the costs for treatments affecting any part or function of the body. Free file 2011 taxes These expenses include payments for legal medical services rendered by physicians, surgeons, dentists, and other medical practitioners. Free file 2011 taxes They include the costs of equipment, supplies, and diagnostic devices needed for these purposes. Free file 2011 taxes Medical care expenses must be primarily to alleviate or prevent a physical or mental defect or illness. Free file 2011 taxes They do not include expenses that are merely beneficial to general health, such as vitamins or a vacation. Free file 2011 taxes Medical expenses include the premiums you pay for insurance that covers the expenses of medical care, and the amounts you pay for transportation to get medical care. Free file 2011 taxes Medical expenses also include amounts paid for qualified long-term care services and limited amounts paid for any qualified long-term care insurance contract. Free file 2011 taxes What Expenses Can You Include This Year? You can include only the medical and dental expenses you paid this year, regardless of when the services were provided. Free file 2011 taxes If you pay medical expenses by check, the day you mail or deliver the check generally is the date of payment. Free file 2011 taxes If you use a “pay-by-phone” or “online” account to pay your medical expenses, the date reported on the statement of the financial institution showing when payment was made is the date of payment. Free file 2011 taxes If you use a credit card, include medical expenses you charge to your credit card in the year the charge is made, not when you actually pay the amount charged. Free file 2011 taxes Separate returns. Free file 2011 taxes   If you and your spouse live in a noncommunity property state and file separate returns, each of you can include only the medical expenses each actually paid. Free file 2011 taxes Any medical expenses paid out of a joint checking account in which you and your spouse have the same interest are considered to have been paid equally by each of you, unless you can show otherwise. Free file 2011 taxes Community property states. Free file 2011 taxes   If you and your spouse live in a community property state and file separate returns, or are registered domestic partners in Nevada, Washington, or California, any medical expenses paid out of community funds are divided equally. Free file 2011 taxes Each of you should include half the expenses. Free file 2011 taxes If medical expenses are paid out of the separate funds of one individual, only the individual who paid the medical expenses can include them. Free file 2011 taxes If you live in a community property state, and are not filing a joint return, see Publication 555, Community Property. Free file 2011 taxes How Much of the Expenses Can You Deduct? Generally, you can deduct on Schedule A (Form 1040) only the amount of your medical and dental expenses that is more than 10% of your AGI (7. Free file 2011 taxes 5% of your AGI if either you or your spouse is age 65 or older)(Form 1040, line 38). Free file 2011 taxes Example. Free file 2011 taxes You are unmarried and under age 65 and your AGI is $40,000, 10% of which is $4,000. Free file 2011 taxes You paid medical expenses of $2,500. Free file 2011 taxes You cannot deduct any of your medical expenses because they are not more than 10% of your AGI. Free file 2011 taxes Whose Medical Expenses Can You Include? You can generally include medical expenses you pay for yourself, as well as those you pay for someone who was your spouse or your dependent either when the services were provided or when you paid for them. Free file 2011 taxes There are different rules for decedents and for individuals who are the subject of multiple support agreements. Free file 2011 taxes See Support claimed under a multiple support agreement , later. Free file 2011 taxes Yourself You can include medical expenses you paid for yourself. Free file 2011 taxes Spouse You can include medical expenses you paid for your spouse. Free file 2011 taxes To include these expenses, you must have been married either at the time your spouse received the medical services or at the time you paid the medical expenses. Free file 2011 taxes Example 1. Free file 2011 taxes Mary received medical treatment before she married Bill. Free file 2011 taxes Bill paid for the treatment after they married. Free file 2011 taxes Bill can include these expenses in figuring his medical expense deduction even if Bill and Mary file separate returns. Free file 2011 taxes If Mary had paid the expenses, Bill could not include Mary's expenses in his separate return. Free file 2011 taxes Mary would include the amounts she paid during the year in her separate return. Free file 2011 taxes If they filed a joint return, the medical expenses both paid during the year would be used to figure their medical expense deduction. Free file 2011 taxes Example 2. Free file 2011 taxes This year, John paid medical expenses for his wife Louise, who died last year. Free file 2011 taxes John married Belle this year and they file a joint return. Free file 2011 taxes Because John was married to Louise when she received the medical services, he can include those expenses in figuring his medical expense deduction for this year. Free file 2011 taxes Dependent You can include medical expenses you paid for your dependent. Free file 2011 taxes For you to include these expenses, the person must have been your dependent either at the time the medical services were provided or at the time you paid the expenses. Free file 2011 taxes A person generally qualifies as your dependent for purposes of the medical expense deduction if both of the following requirements are met. Free file 2011 taxes The person was a qualifying child (defined later) or a qualifying relative (defined later), and The person was a U. Free file 2011 taxes S. Free file 2011 taxes citizen or national, or a resident of the United States, Canada, or Mexico. Free file 2011 taxes If your qualifying child was adopted, see Exception for adopted child , next. Free file 2011 taxes You can include medical expenses you paid for an individual that would have been your dependent except that: He or she received gross income of $3,900 or more in 2013, He or she filed a joint return for 2013, or You, or your spouse if filing jointly, could be claimed as a dependent on someone else's 2013 return. Free file 2011 taxes Exception for adopted child. Free file 2011 taxes   If you are a U. Free file 2011 taxes S. Free file 2011 taxes citizen or U. Free file 2011 taxes S. Free file 2011 taxes national and your adopted child lived with you as a member of your household for 2013, that child does not have to be a U. Free file 2011 taxes S. Free file 2011 taxes citizen or national or a resident of the United States, Canada, or Mexico. Free file 2011 taxes Qualifying Child A qualifying child is a child who: Is your son, daughter, stepchild, foster child, brother, sister, stepbrother, stepsister, half brother, half sister, or a descendant of any of them (for example, your grandchild, niece, or nephew), Was: Under age 19 at the end of 2013 and younger than you (or your spouse, if filing jointly), Under age 24 at the end of 2013, a full-time student, and younger than you (or your spouse, if filing jointly), or Any age and permanently and totally disabled, Lived with you for more than half of 2013, Did not provide over half of his or her own support for 2013, and Did not file a joint return, or, if he or she did, it was only to claim a refund. Free file 2011 taxes Adopted child. Free file 2011 taxes   A legally adopted child is treated as your own child. Free file 2011 taxes This includes a child lawfully placed with you for legal adoption. Free file 2011 taxes   You can include medical expenses that you paid for a child before adoption if the child qualified as your dependent when the medical services were provided or when the expenses were paid. Free file 2011 taxes   If you pay back an adoption agency or other persons for medical expenses they paid under an agreement with you, you are treated as having paid those expenses provided you clearly substantiate that the payment is directly attributable to the medical care of the child. Free file 2011 taxes   But if you pay the agency or other person for medical care that was provided and paid for before adoption negotiations began, you cannot include them as medical expenses. Free file 2011 taxes    You may be able to take an adoption credit for other expenses related to an adoption. Free file 2011 taxes See the Instructions for Form 8839, Qualified Adoption Expenses, for more information. Free file 2011 taxes Child of divorced or separated parents. Free file 2011 taxes   For purposes of the medical and dental expenses deduction, a child of divorced or separated parents can be treated as a dependent of both parents. Free file 2011 taxes Each parent can include the medical expenses he or she pays for the child, even if the other parent claims the child's dependency exemption, if: The child is in the custody of one or both parents for more than half the year, The child receives over half of his or her support during the year from his or her parents, and The child's parents: Are divorced or legally separated under a decree of divorce or separate maintenance, Are separated under a written separation agreement, or Live apart at all times during the last 6 months of the year. Free file 2011 taxes This does not apply if the child's exemption is being claimed under a multiple support agreement (discussed later). Free file 2011 taxes Qualifying Relative A qualifying relative is a person: Who is your: Son, daughter, stepchild, foster child, or a descendant of any of them (for example, your grandchild), Brother, sister, half brother, half sister, or a son or daughter of either of them, Father, mother, or an ancestor or sibling of either of them (for example, your grandmother, grandfather, aunt, or uncle), Stepbrother, stepsister, stepfather, stepmother, son-in-law, daughter-in-law, father-in-law, mother-in-law, brother-in-law, or sister-in-law, or Any other person (other than your spouse) who lived with you all year as a member of your household if your relationship did not violate local law, Who was not a qualifying child (see Qualifying Child earlier) of any other person for 2013, and For whom you provided over half of the support in 2013. Free file 2011 taxes But see Child of divorced or separated parents , earlier, and Support claimed under a multiple support agreement, next. Free file 2011 taxes Support claimed under a multiple support agreement. Free file 2011 taxes   If you are considered to have provided more than half of a qualifying relative's support under a multiple support agreement, you can include medical expenses you pay for that person. Free file 2011 taxes A multiple support agreement is used when two or more people provide more than half of a person's support, but no one alone provides more than half. Free file 2011 taxes   Any medical expenses paid by others who joined you in the agreement cannot be included as medical expenses by anyone. Free file 2011 taxes However, you can include the entire unreimbursed amount you paid for medical expenses. Free file 2011 taxes Example. Free file 2011 taxes You and your three brothers each provide one-fourth of your mother's total support. Free file 2011 taxes Under a multiple support agreement, you treat your mother as your dependent. Free file 2011 taxes You paid all of her medical expenses. Free file 2011 taxes Your brothers reimbursed you for three-fourths of these expenses. Free file 2011 taxes In figuring your medical expense deduction, you can include only one-fourth of your mother's medical expenses. Free file 2011 taxes Your brothers cannot include any part of the expenses. Free file 2011 taxes However, if you and your brothers share the nonmedical support items and you separately pay all of your mother's medical expenses, you can include the unreimbursed amount you paid for her medical expenses in your medical expenses. Free file 2011 taxes Decedent Medical expenses paid before death by the decedent are included in figuring any deduction for medical and dental expenses on the decedent's final income tax return. Free file 2011 taxes This includes expenses for the decedent's spouse and dependents as well as for the decedent. Free file 2011 taxes The survivor or personal representative of a decedent can choose to treat certain expenses paid by the decedent's estate for the decedent's medical care as paid by the decedent at the time the medical services were provided. Free file 2011 taxes The expenses must be paid within the 1-year period beginning with the day after the date of death. Free file 2011 taxes If you are the survivor or personal representative making this choice, you must attach a statement to the decedent's Form 1040 (or the decedent's amended return, Form 1040X) saying that the expenses have not been and will not be claimed on the estate tax return. Free file 2011 taxes Qualified medical expenses paid before death by the decedent are not deductible if paid with a tax-free distribution from any Archer MSA, Medicare Advantage MSA, or health savings account. Free file 2011 taxes Amended returns and claims for refund are discussed in chapter 1. Free file 2011 taxes What if you pay medical expenses of a deceased spouse or dependent?   If you paid medical expenses for your deceased spouse or dependent, include them as medical expenses on your Form 1040 in the year paid, whether they are paid before or after the decedent's death. Free file 2011 taxes The expenses can be included if the person was your spouse or dependent either at the time the medical services were provided or at the time you paid the expenses. Free file 2011 taxes What Medical Expenses Are Includible? Use Table 21-1, later, as a guide to determine which medical and dental expenses you can include on Schedule A (Form 1040). Free file 2011 taxes This table does not include all possible medical expenses. Free file 2011 taxes To determine if an expense not listed can be included in figuring your medical expense deduction, see What Are Medical Expenses , earlier. Free file 2011 taxes Insurance Premiums You can include in medical expenses insurance premiums you pay for policies that cover medical care. Free file 2011 taxes Medical care policies can provide payment for treatment that includes: Hospitalization, surgical services, X-rays, Prescription drugs and insulin, Dental care, Replacement of lost or damaged contact lenses, and Long-term care (subject to additional limitations). Free file 2011 taxes See Qualified Long-Term Care Insurance Contracts in Publication 502. Free file 2011 taxes If you have a policy that provides payments for other than medical care, you can include the premiums for the medical care part of the policy if the charge for the medical part is reasonable. Free file 2011 taxes The cost of the medical part must be separately stated in the insurance contract or given to you in a separate statement. Free file 2011 taxes Note. Free file 2011 taxes When figuring the amount of insurance premiums you can include in medical expenses on Schedule A, do not include any health coverage tax credit advance payments shown in box 1 of Form 1099-H, Health Coverage Tax Credit (HCTC) Advance Payments. Free file 2011 taxes Also, do not include insurance premiums attributable to a nondependent child under age 27 if your premiums increased as a result of adding this child to your policy. Free file 2011 taxes Employer-sponsored health insurance plan. Free file 2011 taxes   Do not include in your medical and dental expenses any insurance premiums paid by an employer-sponsored health insurance plan unless the premiums are included in box 1 of your Form W-2. Free file 2011 taxes Also, do not include any other medical and dental expenses paid by the plan unless the amount paid is included in box 1 of your Form W-2. Free file 2011 taxes Example. Free file 2011 taxes You are a federal employee participating in the premium conversion plan of the Federal Employee Health Benefits (FEHB) program. Free file 2011 taxes Your share of the FEHB premium is paid by making a pre-tax reduction in your salary. Free file 2011 taxes Because you are an employee whose insurance premiums are paid with money that is never included in your gross income, you cannot deduct the premiums paid with that money. Free file 2011 taxes Long-term care services. Free file 2011 taxes   Contributions made by your employer to provide coverage for qualified long-term care services under a flexible spending or similar arrangement must be included in your income. Free file 2011 taxes This amount will be reported as wages in box 1 of your Form W-2. Free file 2011 taxes Health reimbursement arrangement (HRA). Free file 2011 taxes   If you have medical expenses that are reimbursed by a health reimbursement arrangement, you cannot include those expenses in your medical expenses. Free file 2011 taxes This is because an HRA is funded solely by the employer. Free file 2011 taxes Retired public safety officers. Free file 2011 taxes   If you are a retired public safety officer, do not include as medical expenses any health or long-term care premiums that you elected to have paid with tax-free distributions from your retirement plan. Free file 2011 taxes This applies only to distributions that would otherwise be included in income. Free file 2011 taxes Medicare A. Free file 2011 taxes   If you are covered under social security (or if you are a government employee who paid Medicare tax), you are enrolled in Medicare A. Free file 2011 taxes The payroll tax paid for Medicare A is not a medical expense. Free file 2011 taxes   If you are not covered under social security (or were not a government employee who paid Medicare tax), you can voluntarily enroll in Medicare A. Free file 2011 taxes In this situation you can include the premiums you paid for Medicare A as a medical expense. Free file 2011 taxes Medicare B. Free file 2011 taxes   Medicare B is supplemental medical insurance. Free file 2011 taxes Premiums you pay for Medicare B are a medical expense. Free file 2011 taxes Check the information you received from the Social Security Administration to find out your premium. Free file 2011 taxes Medicare D. Free file 2011 taxes    Medicare D is a voluntary prescription drug insurance program for persons with Medicare A or B. Free file 2011 taxes You can include as a medical expense premiums you pay for Medicare D. Free file 2011 taxes Prepaid insurance premiums. Free file 2011 taxes   Premiums you pay before you are age 65 for insurance for medical care for yourself, your spouse, or your dependents after you reach age 65 are medical care expenses in the year paid if they are: Payable in equal yearly installments, or more often, and Payable for at least 10 years, or until you reach age 65 (but not for less than 5 years). Free file 2011 taxes Unused sick leave used to pay premiums. Free file 2011 taxes   You must include in gross income cash payments you receive at the time of retirement for unused sick leave. Free file 2011 taxes You also must include in gross income the value of unused sick leave that, at your option, your employer applies to the cost of your continuing participation in your employer's health plan after you retire. Free file 2011 taxes You can include this cost of continuing participation in the health plan as a medical expense. Free file 2011 taxes   If you participate in a health plan where your employer automatically applies the value of unused sick leave to the cost of your continuing participation in the health plan (and you do not have the option to receive cash), do not include the value of the unused sick leave in gross income. Free file 2011 taxes You cannot include this cost of continuing participation in that health plan as a medical expense. Free file 2011 taxes Table 21-1. Free file 2011 taxes Medical and Dental Expenses Checklist. Free file 2011 taxes See Publication 502 for more information about these and other expenses. Free file 2011 taxes You can include: You cannot include: Bandages Birth control pills prescribed by your doctor Body scan Braille books Breast pump and supplies Capital expenses for equipment or improvements to your home needed for medical care (see the worksheet in Publication 502) Diagnostic devices Expenses of an organ donor Eye surgery—to promote the correct function of the eye Fertility enhancement, certain procedures Guide dogs or other animals aiding the blind, deaf, and disabled Hospital services fees (lab work, therapy, nursing services, surgery, etc. Free file 2011 taxes ) Lead-based paint removal Legal abortion Legal operation to prevent having children such as a vasectomy or tubal ligation Long-term care contracts, qualified Meals and lodging provided by a hospital during medical treatment Medical services fees (from doctors, dentists, surgeons, specialists, and other medical practitioners) Medicare Part D premiums Medical and hospital insurance premiums Nursing services Oxygen equipment and oxygen Part of life-care fee paid to retirement home designated for medical care Physical examination Pregnancy test kit Prescription medicines (prescribed by a doctor) and insulin Psychiatric and psychological treatment Social security tax, Medicare tax, FUTA, and state employment tax for worker providing medical care (see Wages for nursing services, below) Special items (artificial limbs, false teeth, eye-glasses, contact lenses, hearing aids, crutches, wheelchair, etc. Free file 2011 taxes ) Special education for mentally or physically disabled persons Stop-smoking programs Transportation for needed medical care Treatment at a drug or alcohol center (includes meals and lodging provided by the center) Wages for nursing services Weight-loss, certain expenses for obesity Baby sitting and childcare Bottled water Contributions to Archer MSAs (see Publication 969) Diaper service Expenses for your general health (even if following your doctor's advice) such as— —Health club dues —Household help (even if recommended by a doctor) —Social activities, such as dancing or swimming lessons —Trip for general health improvement Flexible spending account reimbursements for medical expenses (if contributions were on a pre-tax basis) Funeral, burial, or cremation expenses Health savings account payments for medical expenses Illegal operation, treatment, or medicine Life insurance or income protection policies, or policies providing payment for loss of life, limb, sight, etc. Free file 2011 taxes Maternity clothes Medical insurance included in a car insurance policy covering all persons injured in or by your car Medicine you buy without a prescription Nursing care for a healthy baby Prescription drugs you brought in (or ordered shipped) from another country, in most cases Nutritional supplements, vitamins, herbal supplements, “natural medicines,” etc. Free file 2011 taxes , unless recommended by a medical practitioner as a treatment for a specific medical condition diagnosed by a physician Surgery for purely cosmetic reasons Toothpaste, toiletries, cosmetics, etc. Free file 2011 taxes Teeth whitening Weight-loss expenses not for the treatment of obesity or other disease Meals and Lodging You can include in medical expenses the cost of meals and lodging at a hospital or similar institution if a principal reason for being there is to get medical care. Free file 2011 taxes See Nursing home , later. Free file 2011 taxes You may be able to include in medical expenses the cost of lodging not provided in a hospital or similar institution. Free file 2011 taxes You can include the cost of such lodging while away from home if all of the following requirements are met. Free file 2011 taxes The lodging is primarily for and essential to medical care. Free file 2011 taxes The medical care is provided by a doctor in a licensed hospital or in a medical care facility related to, or the equivalent of, a licensed hospital. Free file 2011 taxes The lodging is not lavish or extravagant under the circumstances. Free file 2011 taxes There is no significant element of personal pleasure, recreation, or vacation in the travel away from home. Free file 2011 taxes The amount you include in medical expenses for lodging cannot be more than $50 for each night for each person. Free file 2011 taxes You can include lodging for a person traveling with the person receiving the medical care. Free file 2011 taxes For example, if a parent is traveling with a sick child, up to $100 per night can be included as a medical expense for lodging. Free file 2011 taxes Meals are not included. Free file 2011 taxes Nursing home. Free file 2011 taxes   You can include in medical expenses the cost of medical care in a nursing home, home for the aged, or similar institution, for yourself, your spouse, or your dependents. Free file 2011 taxes This includes the cost of meals and lodging in the home if a principal reason for being there is to get medical care. Free file 2011 taxes   Do not include the cost of meals and lodging if the reason for being in the home is personal. Free file 2011 taxes You can, however, include in medical expenses the part of the cost that is for medical or nursing care. Free file 2011 taxes Transportation Include in medical expenses amounts paid for transportation primarily for, and essential to, medical care. Free file 2011 taxes You can include: Bus, taxi, train, or plane fares, or ambulance service, Transportation expenses of a parent who must go with a child who needs medical care, Transportation expenses of a nurse or other person who can give injections, medications, or other treatment required by a patient who is traveling to get medical care and is unable to travel alone, and Transportation expenses for regular visits to see a mentally ill dependent, if these visits are recommended as a part of treatment. Free file 2011 taxes Car expenses. Free file 2011 taxes   You can include out-of-pocket expenses, such as the cost of gas and oil, when you use your car for medical reasons. Free file 2011 taxes You cannot include depreciation, insurance, general repair, or maintenance expenses. Free file 2011 taxes   If you do not want to use your actual expenses for 2013, you can use the standard medical mileage rate of 24 cents per mile. Free file 2011 taxes    You can also include parking fees and tolls. Free file 2011 taxes You can add these fees and tolls to your medical expenses whether you use actual expenses or use the standard mileage rate. Free file 2011 taxes Example. Free file 2011 taxes In 2013, Bill Jones drove 2,800 miles for medical reasons. Free file 2011 taxes He spent $500 for gas, $30 for oil, and $100 for tolls and parking. Free file 2011 taxes He wants to figure the amount he can include in medical expenses both ways to see which gives him the greater deduction. Free file 2011 taxes He figures the actual expenses first. Free file 2011 taxes He adds the $500 for gas, the $30 for oil, and the $100 for tolls and parking for a total of $630. Free file 2011 taxes He then figures the standard mileage amount. Free file 2011 taxes He multiplies 2,800 miles by 24 cents a mile for a total of $672. Free file 2011 taxes He then adds the $100 tolls and parking for a total of $772. Free file 2011 taxes Bill includes the $772 of car expenses with his other medical expenses for the year because the $772 is more than the $630 he figured using actual expenses. Free file 2011 taxes Transportation expenses you cannot include. Free file 2011 taxes   You cannot include in medical expenses the cost of transportation in the following situations. Free file 2011 taxes Going to and from work, even if your condition requires an unusual means of transportation. Free file 2011 taxes Travel for purely personal reasons to another city for an operation or other medical care. Free file 2011 taxes Travel that is merely for the general improvement of one's health. Free file 2011 taxes The costs of operating a specially equipped car for other than medical reasons. Free file 2011 taxes Disabled Dependent Care Expenses Some disabled dependent care expenses may qualify as either: Medical expenses, or Work-related expenses for purposes of taking a credit for dependent care. Free file 2011 taxes (See chapter 32 and Publication 503, Child and Dependent Care Expenses. Free file 2011 taxes ) You can choose to apply them either way as long as you do not use the same expenses to claim both a credit and a medical expense deduction. Free file 2011 taxes How Do You Treat Reimbursements? You can include in medical expenses only those amounts paid during the taxable year for which you received no insurance or other reimbursement. Free file 2011 taxes Insurance Reimbursement You must reduce your total medical expenses for the year by all reimbursements for medical expenses that you receive from insurance or other sources during the year. Free file 2011 taxes This includes payments from Medicare. Free file 2011 taxes Even if a policy provides reimbursement for only certain specific medical expenses, you must use amounts you receive from that policy to reduce your total medical expenses, including those it does not reimburse. Free file 2011 taxes Example. Free file 2011 taxes You have insurance policies that cover your hospital and doctors' bills but not your nursing bills. Free file 2011 taxes The insurance you receive for the hospital and doctors' bills is more than their charges. Free file 2011 taxes In figuring your medical deduction, you must reduce the total amount you spent for medical care by the total amount of insurance you received, even if the policies do not cover some of your medical expenses. Free file 2011 taxes Health reimbursement arrangement (HRA). Free file 2011 taxes   A health reimbursement arrangement is an employer-funded plan that reimburses employees for medical care expenses and allows unused amounts to be carried forward. Free file 2011 taxes An HRA is funded solely by the employer and the reimbursements for medical expenses, up to a maximum dollar amount for a coverage period, are not included in your income. Free file 2011 taxes Other reimbursements. Free file 2011 taxes   Generally, you do not reduce medical expenses by payments you receive for: Permanent loss or loss of use of a member or function of the body (loss of limb, sight, hearing, etc. Free file 2011 taxes ) or disfigurement to the extent the payment is based on the nature of the injury without regard to the amount of time lost from work, or Loss of earnings. Free file 2011 taxes   You must, however, reduce your medical expenses by any part of these payments that is designated for medical costs. Free file 2011 taxes See How Do You Figure and Report the Deduction on Your Tax Return , later. Free file 2011 taxes   For how to treat damages received for personal injury or sickness, see Damages for Personal Injuries , later. Free file 2011 taxes You do not have a medical deduction if you are reimbursed for all of your medical expenses for the year. Free file 2011 taxes Excess reimbursement. Free file 2011 taxes   If you are reimbursed more than your medical expenses, you may have to include the excess in income. Free file 2011 taxes You may want to use Figure 21-A to help you decide if any of your reimbursement is taxable. Free file 2011 taxes Premiums paid by you. Free file 2011 taxes   If you pay either the entire premium for your medical insurance or all of the costs of a plan similar to medical insurance and your insurance payments or other reimbursements are more than your total medical expenses for the year, you have an excess reimbursement. Free file 2011 taxes Generally, you do not include the excess reimbursement in your gross income. Free file 2011 taxes Premiums paid by you and your employer. Free file 2011 taxes   If both you and your employer contribute to your medical insurance plan and your employer's contributions are not included in your gross income, you must include in your gross income the part of your excess reimbursement that is from your employer's contribution. Free file 2011 taxes   See Publication 502 to figure the amount of the excess reimbursement you must include in gross income. Free file 2011 taxes Reimbursement in a later year. Free file 2011 taxes   If you are reimbursed in a later year for medical expenses you deducted in an earlier year, you generally must report the reimbursement as income up to the amount you previously deducted as medical expenses. Free file 2011 taxes   However, do not report as income the amount of reimbursement you received up to the amount of your medical deductions that did not reduce your tax for the earlier year. Free file 2011 taxes For more information about the recovery of an amount that you claimed as an itemized deduction in an earlier year, see Itemized Deduction Recoveries in chapter 12. Free file 2011 taxes Figure 21-A. Free file 2011 taxes Is Your Excess Medical Reimbursement Taxable? Please click here for the text description of the image. Free file 2011 taxes Figure 21-A. Free file 2011 taxes Is Your Excess Medical Reimbursement Taxable? Medical expenses not deducted. Free file 2011 taxes   If you did not deduct a medical expense in the year you paid it because your medical expenses were not more than 10% of your AGI (7. Free file 2011 taxes 5% of your AGI if either you or your spouse was age 65 or older), or because you did not itemize deductions, do not include the reimbursement up to the amount of the expense in income. Free file 2011 taxes However, if the reimbursement is more than the expense, see Excess reimbursement , earlier. Free file 2011 taxes Example. Free file 2011 taxes For 2013, you were unmarried and under age 65 and you had medical expenses of $500. Free file 2011 taxes You cannot deduct the $500 because it is less than 10% of your AGI. Free file 2011 taxes If, in a later year, you are reimbursed for any of the $500 in medical expenses, you do not include the amount reimbursed in your gross income. Free file 2011 taxes Damages for Personal Injuries If you receive an amount in settlement of a personal injury suit, part of that award may be for medical expenses that you deducted in an earlier year. Free file 2011 taxes If it is, you must include that part in your income in the year you receive it to the extent it reduced your taxable income in the earlier year. Free file 2011 taxes See Reimbursement in a Later Year , discussed under How Do You Treat Reimbursements, earlier. Free file 2011 taxes Future medical expenses. Free file 2011 taxes   If you receive an amount in settlement of a damage suit for personal injuries, part of that award may be for future medical expenses. Free file 2011 taxes If it is, you must reduce any future medical expenses for these injuries until the amount you received has been completely used. Free file 2011 taxes How Do You Figure and Report the Deduction on Your Tax Return? Once you have determined which medical expenses you can include, you figure and report the deduction on your tax return. Free file 2011 taxes What Tax Form Do You Use? You figure your medical expense deduction on Schedule A (Form 1040). Free file 2011 taxes You cannot claim medical expenses on Form 1040A or Form 1040EZ. Free file 2011 taxes If you need more information on itemized deductions or you are not sure if you can itemize, see chapter 20. Free file 2011 taxes Enter the amount you paid for medical and dental expenses on Schedule A (Form 1040). Free file 2011 taxes This should be your expenses that were not reimbursed by insurance or any other sources. Free file 2011 taxes Generally, you can deduct only the amount of your medical and dental expenses that is more than 10% of your AGI (7. Free file 2011 taxes 5% if either you or your spouse was age 65 or older) shown on line 38, Form 1040. Free file 2011 taxes Impairment-Related Work Expenses If you are a person with a disability, you can take a business deduction for expenses that are necessary for you to be able to work. Free file 2011 taxes If you take a business deduction for impairment-related work expenses, do not take a medical deduction for the same expenses. Free file 2011 taxes You have a disability if you have: A physical or mental disability (for example, blindness or deafness) that functionally limits your being employed, or A physical or mental impairment (for example, a sight or hearing impairment) that substantially limits one or more of your major life activities, such as performing manual tasks, walking, speaking, breathing, learning, or working. Free file 2011 taxes Impairment-related expenses defined. Free file 2011 taxes   Impairment-related expenses are those ordinary and necessary business expenses that are: Necessary for you to do your work satisfactorily, For goods and services not required or used, other than incidentally, in your personal activities, and Not specifically covered under other income tax laws. Free file 2011 taxes Where to report. Free file 2011 taxes   If you are self-employed, deduct the business expenses on the appropriate form (Schedule C, C-EZ, E, or F) used to report your business income and expenses. Free file 2011 taxes   If you are an employee, complete Form 2106, Employee Business Expenses, or Form 2106-EZ, Unreimbursed Employee Business Expenses. Free file 2011 taxes Enter on Schedule A (Form 1040), that part of the amount on Form 2106, or Form 2106-EZ, that is related to your impairment. Free file 2011 taxes Enter the amount that is unrelated to your impairment also on Schedule A (Form 1040). Free file 2011 taxes Your impairment-related work expenses are not subject to the 2%-of-adjusted-gross-income limit that applies to other employee business expenses. Free file 2011 taxes Example. Free file 2011 taxes You are blind. Free file 2011 taxes You must use a reader to do your work. Free file 2011 taxes You use the reader both during your regular working hours at your place of work and outside your regular working hours away from your place of work. Free file 2011 taxes The reader's services are only for your work. Free file 2011 taxes You can deduct your expenses for the reader as business expenses. Free file 2011 taxes Health Insurance Costs for Self-Employed Persons If you were self-employed and had a net profit for the year, you may be able to deduct, as an adjustment to income, amounts paid for medical and qualified long-term care insurance on behalf of yourself, your spouse, your dependents, and, your children who were under age 27 at the end of 2013. Free file 2011 taxes For this purpose, you were self-employed if you were a general partner (or a limited partner receiving guaranteed payments) or you received wages from an S corporation in which you were more than a 2% shareholder. Free file 2011 taxes The insurance plan must be established under your trade or business and the deduction cannot be more than your earned income from that trade or business. Free file 2011 taxes You cannot deduct payments for medical insurance for any month in which you were eligible to participate in a health plan subsidized by your employer, your spouse's employer, or, an employer of your dependent or your child under age 27 at the end of 2013. Free file 2011 taxes You cannot deduct payments for a qualified long-term care insurance contract for any month in which you were eligible to participate in a long-term care insurance plan subsidized by your employer or your spouse's employer. Free file 2011 taxes If you qualify to take the deduction, use the Self-Employed Health Insurance Deduction Worksheet in the Form 1040 instructions to figure the amount you can deduct. Free file 2011 taxes But if any of the following applies, do not use that worksheet. Free file 2011 taxes You had more than one source of income subject to self-employment tax. Free file 2011 taxes You file Form 2555, Foreign Earned Income, or Form 2555-EZ, Foreign Earned Income Exclusion. Free file 2011 taxes You are using amounts paid for qualified long-term care insurance to figure the deduction. Free file 2011 taxes If you cannot use the worksheet in the Form 1040 instructions, use the worksheet in Publication 535, Business Expenses, to figure your deduction. Free file 2011 taxes Note. Free file 2011 taxes When figuring the amount you can deduct for insurance premiums, do not include any advance payments shown on Form 1099-H, Health Coverage Tax Credit (HCTC) Advance Payments. Free file 2011 taxes If you are claiming the health coverage tax credit, subtract the amount shown on Form 8885, from the total insurance premiums you paid. Free file 2011 taxes Do not include amounts paid for health insurance coverage with retirement plan distributions that were tax-free because you are a retired public safety officer. Free file 2011 taxes Where to report. Free file 2011 taxes    You take this deduction on Form 1040. Free file 2011 taxes If you itemize your deductions and do not claim 100% of your self-employed health insurance on Form 1040, you can generally include any remaining premiums with all other medical expenses on Schedule A (Form 1040), subject to the 10% limit (7. Free file 2011 taxes 5% if either you or your spouse was age 65 or older). Free file 2011 taxes See Self-Employed Health Insurance Deduction in chapter 6 of Publication 535, Business Expenses, and Medical and Dental Expenses in the Instructions for Schedule A (Form 1040), for more information. Free file 2011 taxes Prev  Up  Next   Home   More Online Publications
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Statement by IRS Commissioner John Koskinen on The Fiscal Year 2015 Budget

The Fiscal Year 2015 Budget proposal is a critical step forward in order for us to improve vital taxpayer services and enforcement efforts. Funding the IRS at this level will be a good investment for the nation, helping taxpayers get the service they need and strengthening compliance efforts in key areas, including identity theft, refund fraud and offshore compliance. Every dollar invested in IRS enforcement provides a strong return on investment in revenue collection, plus an added protection in deterring potential fraud. It also halts the decline in key enforcement personnel, and allows the agency to again invest in necessary basic infrastructure and training. In the meantime, we continue looking for more efficiencies to get the most out of every dollar of the budget.

 

The Fiscal Year 2015 Budget will put a stop to significant declines in taxpayer service over the past four years. We are doing everything we can to maximize our services with our current resources, and IRS employees are working hard to minimize delays and deliver as much service as possible. However, it’s clear we need to do more to help taxpayers, and the proposed seven percent increase for taxpayer services will be a big help.

 

Budget In Brief Fiscal Year 2015

Page Last Reviewed or Updated: 04-Mar-2014

The Free File 2011 Taxes

Free file 2011 taxes Publication 584 - Additional Material Table of Contents This image is too large to be displayed in the current screen. Free file 2011 taxes Please click the link to view the image. Free file 2011 taxes Entrance Hall This image is too large to be displayed in the current screen. Free file 2011 taxes Please click the link to view the image. Free file 2011 taxes Living Room This image is too large to be displayed in the current screen. Free file 2011 taxes Please click the link to view the image. Free file 2011 taxes Dining Room This image is too large to be displayed in the current screen. Free file 2011 taxes Please click the link to view the image. Free file 2011 taxes Kitchen This image is too large to be displayed in the current screen. Free file 2011 taxes Please click the link to view the image. Free file 2011 taxes Den This image is too large to be displayed in the current screen. Free file 2011 taxes Please click the link to view the image. Free file 2011 taxes Bedrooms This image is too large to be displayed in the current screen. Free file 2011 taxes Please click the link to view the image. Free file 2011 taxes Bathrooms This image is too large to be displayed in the current screen. Free file 2011 taxes Please click the link to view the image. Free file 2011 taxes Recreation Room This image is too large to be displayed in the current screen. Free file 2011 taxes Please click the link to view the image. Free file 2011 taxes Laundry and Basement This image is too large to be displayed in the current screen. Free file 2011 taxes Please click the link to view the image. Free file 2011 taxes Garage This image is too large to be displayed in the current screen. Free file 2011 taxes Please click the link to view the image. Free file 2011 taxes Sporting Equipment This image is too large to be displayed in the current screen. Free file 2011 taxes Please click the link to view the image. Free file 2011 taxes Men's Clothing This image is too large to be displayed in the current screen. Free file 2011 taxes Please click the link to view the image. Free file 2011 taxes Women's Clothing This image is too large to be displayed in the current screen. Free file 2011 taxes Please click the link to view the image. Free file 2011 taxes Children's Clothing This image is too large to be displayed in the current screen. Free file 2011 taxes Please click the link to view the image. Free file 2011 taxes Jewelry This image is too large to be displayed in the current screen. Free file 2011 taxes Please click the link to view the image. Free file 2011 taxes Electrical Appliances This image is too large to be displayed in the current screen. Free file 2011 taxes Please click the link to view the image. Free file 2011 taxes Linens This image is too large to be displayed in the current screen. Free file 2011 taxes Please click the link to view the image. Free file 2011 taxes Miscellaneous This image is too large to be displayed in the current screen. Free file 2011 taxes Please click the link to view the image. Free file 2011 taxes Motor Vehicles Schedule 20. Free file 2011 taxes Home (Excluding Contents) Note. Free file 2011 taxes If you used the entire property as your home, fill out only column (a). Free file 2011 taxes If you used part of the property as your home and part of it for business or to produce rental income, you must allocate the entries on lines 2-9 between the personal part (column (a)) and the business/rental part (column (b)). Free file 2011 taxes 1. Free file 2011 taxes Description of property (Show location and date acquired. Free file 2011 taxes )     (a)  Personal Part (b)  Business/Rental Part 2. Free file 2011 taxes Cost or other (adjusted) basis of property (from Worksheet A)     3. Free file 2011 taxes Insurance or other reimbursement Note. Free file 2011 taxes If line 2 is more than line 3, skip line 4. Free file 2011 taxes If line 3 is more than line 2, you exclude gain, and the gain is more than you can exclude, see the instructions for line 3 in the Instructions for Form 4684 for the amount to enter. Free file 2011 taxes     4. Free file 2011 taxes Gain from casualty. Free file 2011 taxes If line 3 is more than line 2, enter the difference here and skip lines 5 through 9. Free file 2011 taxes But see Next below line 9. Free file 2011 taxes     5. Free file 2011 taxes Fair market value before casualty     6. Free file 2011 taxes Fair market value after casualty     7. Free file 2011 taxes Decrease in fair market value. Free file 2011 taxes Subtract line 6 from line 5. Free file 2011 taxes     8. Free file 2011 taxes Enter the smaller of line 2 or line 7 Note for business/rental part. Free file 2011 taxes If the property was totally destroyed by casualty, enter on line 8, column (b) the amount from line 2, column (b). Free file 2011 taxes     9. Free file 2011 taxes Subtract line 3 from line 8. Free file 2011 taxes If zero or less, enter -0-. Free file 2011 taxes     Next: Transfer the entries from line 1 and lines 2-9, column (a), above to the corresponding lines on Form 4684, Section A. Free file 2011 taxes Transfer the entries from line 1 and lines 2-9, column (b), to the corresponding lines on Form 4684, Section B. Free file 2011 taxes Worksheet A. Free file 2011 taxes Cost or Other (Adjusted) Basis Caution. Free file 2011 taxes See the Worksheet A Instructions before you use this worksheet. Free file 2011 taxes         (a) Personal Part (b) Business/Rental Part 1. Free file 2011 taxes   Enter the purchase price of the home damaged or destroyed. Free file 2011 taxes (If you filed Form 2119 when you originally acquired that home to postpone gain on the sale of a previous home before May 7, 1997, enter the adjusted basis of the new home from that Form 2119. Free file 2011 taxes ) 1. Free file 2011 taxes     2. Free file 2011 taxes   Seller paid points for home bought after 1990. Free file 2011 taxes Do not include any seller-paid points you already subtracted to arrive at the amount entered on line 1 2. Free file 2011 taxes     3. Free file 2011 taxes   Subtract line 2 from line 1 3. Free file 2011 taxes     4. Free file 2011 taxes   Settlement fees or closing costs. Free file 2011 taxes (See Settlement costs in Publication 551. Free file 2011 taxes ) If line 1 includes the adjusted basis of the new home from Form 2119, skip lines 4a-4g and 5; go to line 6. Free file 2011 taxes         a. Free file 2011 taxes Abstract and recording fees 4a. Free file 2011 taxes       b. Free file 2011 taxes Legal fees (including fees for title search and preparing documents) 4b. Free file 2011 taxes       c. Free file 2011 taxes Survey fees 4c. Free file 2011 taxes       d. Free file 2011 taxes Title insurance 4d. Free file 2011 taxes       e. Free file 2011 taxes Transfer or stamp taxes 4e. Free file 2011 taxes       f. Free file 2011 taxes Amounts that the seller owed that you agreed to pay (back taxes or interest, recording or mortgage fees, and sales commissions) 4f. Free file 2011 taxes       g. Free file 2011 taxes Other 4g. Free file 2011 taxes     5. Free file 2011 taxes   Add lines 4a through 4g 5. Free file 2011 taxes     6. Free file 2011 taxes   Cost of additions and improvements. Free file 2011 taxes (See Increases to Basis in Publication 551. Free file 2011 taxes ) Do not include any additions and improvements included on line 1 6. Free file 2011 taxes     7. Free file 2011 taxes   Special tax assessments paid for local improvements, such as streets and sidewalks 7. Free file 2011 taxes     8. Free file 2011 taxes   Other increases to basis 8. Free file 2011 taxes     9. Free file 2011 taxes   Add lines 3, 5, 6, 7, and 8 9. Free file 2011 taxes     10. Free file 2011 taxes   Depreciation allowed or allowable, related to the business use or rental of the home 10. Free file 2011 taxes 0   11. Free file 2011 taxes   Other decreases to basis (See Decreases to Basis in Publication 551. Free file 2011 taxes ) 11. Free file 2011 taxes     12. Free file 2011 taxes   Add lines 10 and 11 12. Free file 2011 taxes     13. Free file 2011 taxes   Cost or other (adjusted) basis of home damaged or destroyed. Free file 2011 taxes Subtract line 12 from line 9. Free file 2011 taxes Enter here and on Schedule 20, line 2 13. Free file 2011 taxes     Worksheet A Instructions. Free file 2011 taxes If you use Worksheet A to figure the cost or other (adjusted) basis of your home, follow these instructions. Free file 2011 taxes DO NOT use this worksheet to determine your basis if you acquired an interest in your home from a decedent who died in 2010 and whose executor filed Form 8939. Free file 2011 taxes IF. Free file 2011 taxes . Free file 2011 taxes . Free file 2011 taxes   THEN. Free file 2011 taxes . Free file 2011 taxes . Free file 2011 taxes you inherited your home from a decedent who died either before or after 2010 or from a decedent who died in 2010 and whose executor did not file Form 8939. Free file 2011 taxes 1 skip lines 1–4 of the worksheet. Free file 2011 taxes 2 find your basis using the rules under Inherited Property in Publication 551. Free file 2011 taxes Enter this amount on line 5 of the worksheet. Free file 2011 taxes 3 fill out lines 6–13 of the worksheet. Free file 2011 taxes you received your home as a gift 1 read Property Received as a Gift in Publication 551 and enter on lines 1 and 3 of the worksheet either the donor's adjusted basis or the home's fair market value at the time of the gift, whichever is appropriate. Free file 2011 taxes 2 if you can add any federal gift tax to your basis, enter that amount on line 5 of the worksheet. Free file 2011 taxes 3 fill out the rest of the worksheet. Free file 2011 taxes you received your home as a trade for other property 1 enter on line 1 of the worksheet the fair market value of the other property at the time of the trade. Free file 2011 taxes (But if you received your home as a trade for your previous home before May 7, 1997, and had a gain on the trade that you postponed using Form 2119, enter on line 1 of the worksheet the adjusted basis of the new home from that Form 2119. Free file 2011 taxes ) 2 fill out the rest of the worksheet. Free file 2011 taxes you built your home 1 add the purchase price of the land and the cost of building the home. Free file 2011 taxes Enter that total on line 1 of the worksheet. Free file 2011 taxes (However, if you filed a Form 2119 to postpone gain on the sale of a previous home before May 7, 1997, enter on line 1 of the worksheet the adjusted basis of the new home from that Form 2119. Free file 2011 taxes ) 2 fill out the rest of the worksheet. Free file 2011 taxes you received your home from your spouse after July 18, 1984 1 skip lines 1–4 of the worksheet. Free file 2011 taxes 2 enter on line 5 of the worksheet your spouse's cost or other (adjusted) basis in the home just before you received it. Free file 2011 taxes 3 fill out lines 6–13 of the worksheet, making adjustments to basis only for events after the transfer. Free file 2011 taxes you owned a home jointly with your spouse, who transferred his or her interest in the home to you after July 18, 1984     fill out one worksheet, making adjustments to basis for events both before and after the transfer. Free file 2011 taxes   you received your home from your spouse before July 19, 1984 1 skip lines 1–4 of the worksheet. Free file 2011 taxes 2 enter on line 5 of the worksheet the home's fair market value at the time you received it. Free file 2011 taxes 3 fill out lines 6–13 of the worksheet, making adjustments to basis only for events after the transfer. Free file 2011 taxes you owned a home jointly with your spouse, and your spouse transferred his or her interest in the home to you before July 19, 1984 1 fill out a worksheet, lines 1–13, making adjustments to basis only for events before the transfer. Free file 2011 taxes 2 multiply the amount on line 13 of that worksheet by 50% (0. Free file 2011 taxes 50) to get the adjusted basis of your half-interest at the time of the transfer. Free file 2011 taxes 3 multiply the fair market value of the home at the time of the transfer by 50% (0. Free file 2011 taxes 50). Free file 2011 taxes Generally, this is the basis of the half-interest that your spouse owned. Free file 2011 taxes 4 add the amounts from steps 2 and 3 and enter the total on line 5 of a second worksheet. Free file 2011 taxes 5 complete lines 6–13 of the second worksheet, making adjustments to basis only for events after the transfer. Free file 2011 taxes you owned your home jointly with a nonspouse 1 fill out lines 1–13 of the worksheet. Free file 2011 taxes 2 multiply the amount on line 13 by your percentage of ownership to get the adjusted basis of your part-interest. Free file 2011 taxes Worksheet A Instructions. Free file 2011 taxes (Continued) IF. Free file 2011 taxes . Free file 2011 taxes . Free file 2011 taxes   THEN. Free file 2011 taxes . Free file 2011 taxes . Free file 2011 taxes you owned your home jointly with your spouse who died before 2010 and before the casualty 1 fill out a worksheet, lines 1–13, including adjustments to basis only for events before your spouse's death. Free file 2011 taxes 2 multiply the amount on line 13 of that worksheet by 50% (0. Free file 2011 taxes 50) to get the adjusted basis of your half-interest on the date of death. Free file 2011 taxes 3 figure the basis for the half-interest owned by your spouse. Free file 2011 taxes This is one-half of the fair market value on the date of death (or later alternate valuation used for estate or inheritance tax). Free file 2011 taxes (The basis in your half will remain one-half of the adjusted basis determined in step 2. Free file 2011 taxes ) 4 add the amounts from steps 2 and 3 and enter the total on line 5 of a second worksheet. Free file 2011 taxes 5 complete lines 6–13 of the second worksheet, making adjustments to basis only for events after your spouse's death. Free file 2011 taxes you owned your home jointly with your spouse who died before 2010 and before the casualty, and your permanent legal home is in a community property state 1 skip lines 1–4 of the worksheet. Free file 2011 taxes 2 enter the amount of your basis on line 5 of the worksheet. Free file 2011 taxes Generally, this is the fair market value of the home at the time of death. Free file 2011 taxes (But see Community Property in Publication 551 for special rules. Free file 2011 taxes ) 3 fill out lines 6–13 of the worksheet, making adjustments to basis only for events after your spouse's death. Free file 2011 taxes you owned your home jointly with a nonspouse who died before 2010 and before the casualty 1 fill out lines 1–13 of the worksheet, including adjustments to basis only for events before the co-owner's death. Free file 2011 taxes 2 multiply the amount on line 13 by your percentage of ownership to get the adjusted basis of your part-interest on the date of death. Free file 2011 taxes 3 multiply the fair market value on the date of death (or later alternate valuation used for estate or inheritance tax) by the co-owner's percentage of ownership. Free file 2011 taxes This is the basis for the co-owner's part-interest. Free file 2011 taxes 4 add the amounts from steps 2 and 3 and enter the total on line 5 of a second worksheet. Free file 2011 taxes 5 complete lines 6–13 of the second worksheet, including adjustments to basis only for events after the co-owner's death. Free file 2011 taxes your home was ever damaged as a result of a prior casualty 1 on line 8 of the worksheet, enter any amounts you spent to restore the home to its condition before the prior casualty. Free file 2011 taxes 2 on line 11 enter: any insurance reimbursements you received (or expect to receive) for the prior loss,  and any deductible casualty losses from prior years not covered by insurance. Free file 2011 taxes the person who sold you your home paid points on your loan and you bought your home after 1990 but before April 4, 1994. Free file 2011 taxes   on line 2 enter the seller-paid points only if you deducted them as home mortgage interest in the year paid (unless you used the seller-paid points to reduce the amount on line 1). Free file 2011 taxes the person who sold you your home paid points on your loan and you bought your home after April 3, 1994   on line 2 enter the seller-paid points even if you did not deduct them (unless you used the seller-paid points to reduce the amount on line 1). Free file 2011 taxes you used part of the property as your home and part of it for business or to produce rental income   you must allocate the entries on Worksheet A between the personal part (column (a)) and the business/rental part (column (b)). Free file 2011 taxes none of these items apply   fill out the entire worksheet. Free file 2011 taxes Prev  Up  Next   Home   More Online Publications