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Free State Tax Preparation

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Free State Tax Preparation

Free state tax preparation 1. Free state tax preparation   Scholarships, Fellowships, Grants, and Tuition Reductions Table of Contents Reminder Introduction Scholarships and FellowshipsTax-Free Scholarships and Fellowships Taxable Scholarships and Fellowships Reporting Scholarships and Fellowships Other Types of Educational AssistanceFulbright Grants Pell Grants and Other Title IV Need-Based Education Grants Payment to Service Academy Cadets Veterans' Benefits Qualified Tuition Reduction Reminder Individual retirement arrangements (IRAs). Free state tax preparation  You can set up and make contributions to an IRA if you receive taxable compensation. Free state tax preparation Under this rule, a taxable scholarship or fellowship is compensation only if it is shown in box 1 of your Form W-2, Wage and Tax Statement. Free state tax preparation For more information about IRAs, see Publication 590. Free state tax preparation Introduction This chapter discusses the income tax treatment of various types of educational assistance you may receive if you are studying, teaching, or researching in the United States. Free state tax preparation The educational assistance can be for a primary or secondary school, a college or university, or a vocational school. Free state tax preparation Included are discussions of: Scholarships, Fellowships, Need-based education grants, such as a Pell Grant, and Qualified tuition reductions. Free state tax preparation Many types of educational assistance are tax free if they meet the requirements discussed here. Free state tax preparation Special rules apply to U. Free state tax preparation S. Free state tax preparation citizens and resident aliens who have received scholarships or fellowships for studying, teaching, or researching abroad. Free state tax preparation For information about these rules, see Publication 54, Tax Guide for U. Free state tax preparation S. Free state tax preparation Citizens and Resident Aliens Abroad. Free state tax preparation Scholarships and Fellowships A scholarship is generally an amount paid or allowed to, or for the benefit of, a student (whether an undergraduate or a graduate) at an educational institution to aid in the pursuit of his or her studies. Free state tax preparation A fellowship is generally an amount paid for the benefit of an individual to aid in the pursuit of study or research. Free state tax preparation Amount of scholarship or fellowship. Free state tax preparation   The amount of a scholarship or fellowship includes the following: The value of contributed services and accommodations. Free state tax preparation This includes such services and accommodations as room (lodging), board (meals), laundry service, and similar services or accommodations that are received by an individual as a part of a scholarship or fellowship. Free state tax preparation The amount of tuition, matriculation, and other fees that are paid or remitted to the student to aid the student in pursuing study or research. Free state tax preparation Any amount received in the nature of a family allowance as a part of a scholarship or fellowship. Free state tax preparation Tax-Free Scholarships and Fellowships A scholarship or fellowship is tax free (excludable from gross income) only if you are a candidate for a degree at an eligible educational institution. Free state tax preparation A scholarship or fellowship is tax free only to the extent: It does not exceed your expenses; It is not designated or earmarked for other purposes (such as room and board), and does not require (by its terms) that it cannot be used for qualified education expenses; and It does not represent payment for teaching, research, or other services required as a condition for receiving the scholarship. Free state tax preparation (But for exceptions, see Payment for services,later. Free state tax preparation Use Worksheet 1–1 to figure the amount of a scholarship or fellowship you can exclude from gross income. Free state tax preparation Candidate for a degree. Free state tax preparation   You are a candidate for a degree if you: Attend a primary or secondary school or are pursuing a degree at a college or university, or Attend an educational institution that: Provides a program that is acceptable for full credit toward a bachelor's or higher degree, or offers a program of training to prepare students for gainful employment in a recognized occupation; and Is authorized under federal or state law to provide such a program and is accredited by a nationally recognized accreditation agency. Free state tax preparation Eligible educational institution. Free state tax preparation   An eligible educational institution is one whose primary function is the presentation of formal instruction and that normally maintains a regular faculty and curriculum and normally has a regularly enrolled body of students in attendance at the place where it carries on its educational activities. Free state tax preparation Qualified education expenses. Free state tax preparation   For purposes of tax-free scholarships and fellowships, these are expenses for: Tuition and fees required to enroll at or attend an eligible educational institution, and Course-related expenses, such as fees, books, supplies, and equipment that are required for the courses at the eligible educational institution. Free state tax preparation These items must be required of all students in your course of instruction. Free state tax preparation Expenses that do not qualify. Free state tax preparation   Qualified education expenses do not include the cost of: Room and board, Travel, Research, Clerical help, or Equipment and other expenses that are not required for enrollment in or attendance at an eligible educational institution. Free state tax preparation Payment for services. Free state tax preparation   Generally, you cannot exclude from your gross income the part of any scholarship or fellowship that represents payment for teaching, research, or other services required as a condition for receiving the scholarship. Free state tax preparation This applies even if all candidates for a degree must perform the services to receive the degree. Free state tax preparation (See exceptions next. Free state tax preparation ) Exceptions. Free state tax preparation   You do not have to treat as payment for services the part of any scholarship or fellowship that represents payment for teaching, research, or other services if you receive the amount under: The National Health Service Corps Scholarship Program, or The Armed Forces Health Professions Scholarship and Financial Assistance Program. Free state tax preparation Example 1. Free state tax preparation You received a scholarship of $2,500. Free state tax preparation The scholarship was not received under either of the exceptions mentioned above. Free state tax preparation As a condition for receiving the scholarship, you must serve as a part-time teaching assistant. Free state tax preparation Of the $2,500 scholarship, $1,000 represents payment for teaching. Free state tax preparation The provider of your scholarship gives you a Form W-2 showing $1,000 as income. Free state tax preparation Your qualified education expenses were at least $1,500. Free state tax preparation Assuming that all other conditions are met, $1,500 of your scholarship is tax free. Free state tax preparation The $1,000 you received for teaching is taxable. Free state tax preparation Example 2. Free state tax preparation You are a candidate for a degree at a medical school. Free state tax preparation You receive a scholarship (not under either of the exceptions mentioned above) for your medical education and training. Free state tax preparation The terms of your scholarship require you to perform future services. Free state tax preparation A substantial penalty applies if you do not comply. Free state tax preparation The entire amount of your grant is taxable as payment for services in the year it is received. Free state tax preparation Athletic Scholarships An athletic scholarship is tax free only if and to the extent it meets the requirements discussed later. Free state tax preparation Worksheet 1-1. Free state tax preparation    You can use Worksheet 1-1, Taxable Scholarship and Fellowship Income , later, to figure the tax-free and taxable parts of your athletic scholarship. Free state tax preparation    Worksheet 1-1. Free state tax preparation Taxable Scholarship and Fellowship Income 1. Free state tax preparation Enter the total amount of any scholarship or fellowship for 2013. Free state tax preparation See Amount of scholarship or fellowship, earlier. Free state tax preparation 1. Free state tax preparation       If you are a degree candidate at an eligible educational institution, go to line 2. Free state tax preparation If you are not a degree candidate at an eligible educational institution, stop here. Free state tax preparation The entire amount is taxable. Free state tax preparation For information on how to report this amount on your tax return, see Reporting Scholarships and Fellowships , earlier, in this chapter. Free state tax preparation       2. Free state tax preparation Enter the amount from line 1 that was for teaching, research, or any other services required as a condition for receiving the scholarship. Free state tax preparation (Do not include amounts received for these items under the National Health Service Corps Scholarship Program or the Armed Forces Health Professions Scholarship and Financial Assistance Program. Free state tax preparation ) 2. Free state tax preparation     3. Free state tax preparation Subtract line 2 from line 1 3. Free state tax preparation     4. Free state tax preparation Enter the amount from line 3 that your scholarship or fellowship required you to use for other than qualified education expenses 4. Free state tax preparation     5. Free state tax preparation Subtract line 4 from line 3 5. Free state tax preparation     6. Free state tax preparation Enter the amount of your qualified education expenses 6. Free state tax preparation     7. Free state tax preparation Enter the smaller of line 5 or line 6. Free state tax preparation This amount is the most you can exclude from your gross income (the tax-free part of the scholarship or fellowship) 7. Free state tax preparation     8. Free state tax preparation Subtract line 7 from line 5 8. Free state tax preparation     9. Free state tax preparation Taxable part. Free state tax preparation Add lines 2, 4, and 8. Free state tax preparation See Reporting Scholarships and Fellowships , earlier, for how to report this amount on your tax return 9. Free state tax preparation     Taxable Scholarships and Fellowships If and to the extent your scholarship or fellowship does not meet the requirements described earlier, it is taxable and must be included in gross income. Free state tax preparation You can use Worksheet 1–1, Taxable Scholarship and Fellowship Income, later, to figure the tax-free and taxable parts of your scholarship or fellowship. Free state tax preparation Reporting Scholarships and Fellowships Whether you must report your scholarship or fellowship depends on whether you must file a return and whether any part of your scholarship or fellowship is taxable. Free state tax preparation If your only income is a completely tax-free scholarship or fellowship, you do not have to file a tax return and no reporting is necessary. Free state tax preparation If all or part of your scholarship or fellowship is taxable and you are required to file a tax return, report the taxable amount as explained below. Free state tax preparation You must report the taxable amount whether or not you received a Form W-2. Free state tax preparation If you receive an incorrect Form W-2, ask the payer for a corrected one. Free state tax preparation For information on whether you must file a return, see Publication 501, Exemptions, Standard Deduction, and Filing Information, or your income tax form instructions. Free state tax preparation How To Report How you report any taxable scholarship or fellowship income depends on which return you file. Free state tax preparation Form 1040EZ. Free state tax preparation   If you file Form 1040EZ, include the taxable amount in the total on line 1. Free state tax preparation If the taxable amount was not reported on Form W-2, also enter “SCH” and the taxable amount in the space to the left of line 1. Free state tax preparation Form 1040A. Free state tax preparation   If you file Form 1040A, include the taxable amount in the total on line 7. Free state tax preparation If the taxable amount was not reported on Form W-2, also enter “SCH” and the taxable amount in the space to the left of line 7. Free state tax preparation Form 1040. Free state tax preparation   If you file Form 1040, include the taxable amount in the total on line 7. Free state tax preparation If the taxable amount was not reported on Form W-2, also enter “SCH” and the taxable amount on the dotted line next to line 7. Free state tax preparation Schedule SE (Form 1040). Free state tax preparation   To determine your net earnings from self-employment, include amounts you receive under a scholarship as pay for your services that are reported to you on Form 1099-MISC, Miscellaneous Income. Free state tax preparation If your net earnings are $400 or more, you must pay self-employment tax. Free state tax preparation Use Schedule SE, Self-Employment Tax, to figure this tax. Free state tax preparation Form 1040NR. Free state tax preparation   If you file Form 1040NR, report the taxable amount on line 12. Free state tax preparation Generally, you must report the amount shown in box 2 of Form(s) 1042-S, Foreign Person's U. Free state tax preparation S. Free state tax preparation Source Income Subject to Withholding. Free state tax preparation See the Instructions for Form 1040NR for more information. Free state tax preparation Form 1040NR-EZ. Free state tax preparation   If you file Form 1040NR-EZ, report the taxable amount on line 5. Free state tax preparation Generally, you must report the amount shown in box 2 of Form(s) 1042-S. Free state tax preparation See the Instructions for Form 1040NR-EZ for more information. Free state tax preparation Other Types of Educational Assistance The following discussions deal with other common types of educational assistance. Free state tax preparation Fulbright Grants A Fulbright grant is generally treated as a scholarship or fellowship in figuring how much of the grant is tax free. Free state tax preparation Pell Grants and Other Title IV Need-Based Education Grants These need-based grants are treated as scholarships for purposes of determining their tax treatment. Free state tax preparation They are tax free to the extent used for qualified education expenses during the period for which a grant is awarded. Free state tax preparation Payment to Service Academy Cadets An appointment to a United States military academy is not a scholarship or fellowship. Free state tax preparation Payment you receive as a cadet or midshipman at an armed services academy is pay for personal services and will be reported to you in box 1 of Form W-2. Free state tax preparation Include this pay in your income in the year you receive it unless one of the exceptions, discussed earlier under Payment for services , applies. Free state tax preparation Veterans' Benefits Payments you receive for education, training, or subsistence under any law administered by the Department of Veterans Affairs (VA) are tax free. Free state tax preparation Do not include these payments as income on your federal tax return. Free state tax preparation If you qualify for one or more of the education benefits discussed in chapters 2 through 12, you may have to reduce the amount of education expenses qualifying for a specific benefit by part or all of your VA payments. Free state tax preparation This applies only to the part of your VA payments that is required to be used for education expenses. Free state tax preparation You may want to visit the Veteran's Administration website at www. Free state tax preparation gibill. Free state tax preparation va. Free state tax preparation gov for specific information about the various VA benefits for education. Free state tax preparation Example. Free state tax preparation You have returned to college and are receiving two education benefits under the latest GI Bill: (1) a $1,534 monthly basic housing allowance (BHA) that is directly deposited to your checking account, and (2) $3,840 paid directly to your college for tuition. Free state tax preparation Neither of these benefits is taxable and you do not report them on your tax return. Free state tax preparation You also want to claim an American opportunity credit on your return. Free state tax preparation You paid $5,000 in qualified education expenses (see chapter 2, American Opportunity Credit , later). Free state tax preparation To figure the amount of credit, you must first subtract the $3,840 from your qualified education expenses because this payment under the GI Bill was required to be used for education expenses. Free state tax preparation You do not subtract any amount of the BHA because it was paid to you and its use was not restricted. Free state tax preparation Qualified Tuition Reduction If you are allowed to study tuition free or for a reduced rate of tuition, you may not have to pay tax on this benefit. Free state tax preparation This is called a “tuition reduction. Free state tax preparation ” You do not have to include a qualified tuition reduction in your income. Free state tax preparation A tuition reduction is qualified only if you receive it from, and use it at, an eligible educational institution. Free state tax preparation You do not have to use the tuition reduction at the eligible educational institution from which you received it. Free state tax preparation In other words, if you work for an eligible educational institution and the institution arranges for you to take courses at another eligible educational institution without paying any tuition, you may not have to include the value of the free courses in your income. Free state tax preparation The rules for determining if a tuition reduction is qualified, and therefore tax free, are different if the education provided is below the graduate level or is graduate education. Free state tax preparation You must include in your income any tuition reduction you receive that is payment for your services. Free state tax preparation Eligible educational institution. Free state tax preparation   An eligible educational institution is one that maintains a regular faculty and curriculum and normally has a regularly enrolled body of students in attendance at the place where it carries on its educational activities. Free state tax preparation Officers, owners, and highly compensated employees. Free state tax preparation   Qualified tuition reductions apply to officers, owners, or highly compensated employees only if benefits are available to employees on a nondiscriminatory basis. Free state tax preparation This means that the tuition reduction benefits must be available on substantially the same basis to each member of a group of employees. Free state tax preparation The group must be defined under a reasonable classification set up by the employer. Free state tax preparation The classification must not discriminate in favor of owners, officers, or highly compensated employees. Free state tax preparation Payment for services. Free state tax preparation   Generally, you must include in income the part of any qualified tuition reduction that represents payment for teaching, research, or other services by the student required as a condition of receiving the qualified tuition reduction. Free state tax preparation This applies even if all candidates for a degree must perform the services to receive the degree. Free state tax preparation (See below for exceptions. Free state tax preparation ) Exceptions. Free state tax preparation   You do not have to include in income the part of any scholarship or fellowship that represents payment for teaching, research, or other services if you receive the amount under: The National Health Service Corps Scholarship Program, or The Armed Forces Health Professions Scholarship and Financial Assistance Program. Free state tax preparation Education Below the Graduate Level If you receive a tuition reduction for education below the graduate level (including primary, secondary, or high school), it is a qualified tuition reduction, and therefore tax free, only if your relationship to the educational institution providing the benefit is described below. Free state tax preparation You are an employee of the eligible educational institution. Free state tax preparation You were an employee of the eligible educational institution, but you retired or left on disability. Free state tax preparation You are a widow or widower of an individual who died while an employee of the eligible educational institution or who retired or left on disability. Free state tax preparation You are the dependent child or spouse of an individual described in (1) through (3), above. Free state tax preparation Child of deceased parents. Free state tax preparation   For purposes of the qualified tuition reduction, a child is a dependent child if the child is under age 25 and both parents have died. Free state tax preparation Child of divorced parents. Free state tax preparation   For purposes of the qualified tuition reduction, a dependent child of divorced parents is treated as the dependent of both parents. Free state tax preparation Graduate Education A tuition reduction you receive for graduate education is qualified, and therefore tax free, if both of the following requirements are met. Free state tax preparation It is provided by an eligible educational institution. Free state tax preparation You are a graduate student who performs teaching or research activities for the educational institution. Free state tax preparation You must include in income any other tuition reductions for graduate education that you receive. Free state tax preparation How To Report Any tuition reduction that is taxable should be included as wages in box 1 of your Form W-2. Free state tax preparation Report the amount from Form W-2, box 1, on line 7 (Form 1040 or Form 1040A) or line 1 (Form 1040EZ). Free state tax preparation Prev  Up  Next   Home   More Online Publications
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Understanding Your CP90C Notice

We levied you for unpaid taxes. You have the right to a Collection Due
Process hearing.


What you need to do

  • Read your notice carefully — it explains our actions.
  • Pay what you owe.
  • Make a payment plan if you can’t pay the full amount you owe.

You may want to...


Answers to Common Questions

What should I do if I disagree with the notice?
Request a Collection Due Process hearing.

Why should I request a Collection Due Process hearing?
You can appeal the levy and other disagreements you have at a Collection Due Process hearing.

How do I request a Collection Due Process hearing?
Complete and send us a Form 12153, Request for a Collection Due Process or Equivalent Hearing.

Why didn't you tell me about my rights before you levied me?
Federal contractors do not have the right to a pre-levy hearing. We've already sent you several notices about the amount you owe.

What happens if I can't pay what I owe?
You can request a payment plan if you can't pay the full amount you owe.

How can I make a payment plan?
Call us at the toll free number on the top right corner of your notice to talk about payment plans or learn more about them here.


Tips for next year

Consider filing your taxes electronically. Filing online can help you avoid mistakes and find credits and deductions that you may qualify for. In many cases you can file for free. Learn more about how to file electronically.

Printable samples of this notice (PDF)

Tax publications you may find useful

How to get help

Calling the 1-800 number listed on the top right corner of your notice is the fastest way to get your questions answered.

You can also authorize someone (such as an accountant) to contact the IRS on your behalf using this Power of Attorney and Declaration of Representative (Form 2848).

Or you may qualify for help from a Low Income Taxpayer Clinic.
 

Page Last Reviewed or Updated: 24-Mar-2014

The Free State Tax Preparation

Free state tax preparation 4. Free state tax preparation   Retirement Savings Contributions Credit (Saver's Credit) Table of Contents What's New Introduction Full-time student. Free state tax preparation Adjusted gross income. Free state tax preparation Distributions received by spouse. Free state tax preparation Testing period. Free state tax preparation What's New Modified AGI limit for retirement savings contributions credit increased. Free state tax preparation  For 2013, you may be able to claim the retirement savings contributions credit if your modified AGI is not more than: $59,000 if your filing status is married filing jointly, $44,250 if your filing status is head of household, or $29,500 if your filing status is single, married filing separately, or qualifying widow(er). Free state tax preparation Introduction You may be able to take a tax credit if you make eligible contributions (defined later) to a qualified retirement plan, an eligible deferred compensation plan, or an individual retirement arrangement (IRA). Free state tax preparation You may be able to take a credit of up to $1,000 (up to $2,000 if filing jointly). Free state tax preparation This credit could reduce the federal income tax you pay dollar for dollar. Free state tax preparation    Can you claim the credit?   If you make eligible contributions to a qualified retirement plan, an eligible deferred compensation plan, or an IRA, you can claim the credit if all of the following apply. Free state tax preparation You were born before January 2, 1996. Free state tax preparation You are not a full-time student (explained next). Free state tax preparation No one else, such as your parent(s), claims an exemption for you on their tax return. Free state tax preparation Your adjusted gross income (defined below) is not more than: $59,000 if your filing status is married filing jointly, $44,250 if your filing status is head of household, or $29,500 if your filing status is single, married filing separately, or qualifying widow(er). Free state tax preparation Full-time student. Free state tax preparation   You are a full-time student if, during some part of each of 5 calendar months (not necessarily consecutive) during the calendar year, you are either: A full-time student at a school that has a regular teaching staff, course of study, and regularly enrolled body of students in attendance, or A student taking a full-time, on-farm training course given by either a school that has a regular teaching staff, course of study, and regularly enrolled body of students in attendance, or a state, county, or local government. Free state tax preparation You are a full-time student if you are enrolled for the number of hours or courses the school considers to be full time. Free state tax preparation Adjusted gross income. Free state tax preparation   This is generally the amount on line 38 of your 2013 Form 1040; line 22 of your 2013 Form 1040A; or line 37 of your 2013 Form 1040NR. Free state tax preparation However, you must add to that amount any exclusion or deduction claimed for the year for: Foreign earned income, Foreign housing costs, Income for bona fide residents of American Samoa, and Income from Puerto Rico. Free state tax preparation Eligible contributions. Free state tax preparation   These include: Contributions to a traditional or Roth IRA, Salary reduction contributions (elective deferrals, including amounts designated as after-tax Roth contributions) to: A 401(k) plan (including a SIMPLE 401(k)), A section 403(b) annuity, An eligible deferred compensation plan of a state or local government (a governmental 457 plan), A SIMPLE IRA plan, or A salary reduction SEP, and Contributions to a section 501(c)(18) plan. Free state tax preparation They also include voluntary after-tax employee contributions to a tax-qualified retirement plan or section 403(b) annuity. Free state tax preparation For purposes of the credit, an employee contribution will be voluntary as long as it is not required as a condition of employment. Free state tax preparation Reducing eligible contributions. Free state tax preparation   Reduce your eligible contributions (but not below zero) by the total distributions you received during the testing period (defined later) from any IRA, plan, or annuity included above under Eligible contributions. Free state tax preparation Also reduce your eligible contributions by any distribution from a Roth IRA that is not rolled over, even if the distribution is not taxable. Free state tax preparation   Do not reduce your eligible contributions by any of the following. Free state tax preparation The portion of any distribution which is not includible in income because it is a trustee-to-trustee transfer or a rollover distribution. Free state tax preparation Distributions that are taxable as the result of an in-plan rollover to your designated Roth account. Free state tax preparation Any distribution that is a return of a contribution to an IRA (including a Roth IRA) made during the year for which you claim the credit if: The distribution is made before the due date (including extensions) of your tax return for that year, You do not take a deduction for the contribution, and The distribution includes any income attributable to the contribution. Free state tax preparation Loans from a qualified employer plan treated as a distribution. Free state tax preparation Distributions of excess contributions or deferrals (and income attributable to excess contributions and deferrals). Free state tax preparation Distributions of dividends paid on stock held by an employee stock ownership plan under section 404(k). Free state tax preparation Distributions from an eligible retirement plan that are converted or rolled over to a Roth IRA. Free state tax preparation Distributions from a military retirement plan. Free state tax preparation Distributions from an inherited IRA by a nonspousal beneficiary. Free state tax preparation Distributions received by spouse. Free state tax preparation   Any distributions your spouse receives are treated as received by you if you file a joint return with your spouse both for the year of the distribution and for the year for which you claim the credit. Free state tax preparation Testing period. Free state tax preparation   The testing period consists of the year for which you claim the credit, the period after the end of that year and before the due date (including extensions) for filing your return for that year, and the 2 tax years before that year. Free state tax preparation Example. Free state tax preparation You and your spouse filed joint returns in 2011 and 2012, and plan to do so in 2013 and 2014. Free state tax preparation You received a taxable distribution from a qualified plan in 2011 and a taxable distribution from an eligible deferred compensation plan in 2012. Free state tax preparation Your spouse received taxable distributions from a Roth IRA in 2013 and tax-free distributions from a Roth IRA in 2014 before April 15. Free state tax preparation You made eligible contributions to an IRA in 2013 and you otherwise qualify for this credit. Free state tax preparation You must reduce the amount of your qualifying contributions in 2013 by the total of the distributions you received in 2011, 2012, 2013, and 2014. Free state tax preparation Maximum eligible contributions. Free state tax preparation   After your contributions are reduced, the maximum annual contribution on which you can base the credit is $2,000 per person. Free state tax preparation Effect on other credits. Free state tax preparation   The amount of this credit will not change the amount of your refundable tax credits. Free state tax preparation A refundable tax credit, such as the earned income credit or the refundable amount of your child tax credit, is an amount that you would receive as a refund even if you did not otherwise owe any taxes. Free state tax preparation Maximum credit. Free state tax preparation   This is a nonrefundable credit. Free state tax preparation The amount of the credit in any year cannot be more than the amount of tax that you would otherwise pay (not counting any refundable credits) in any year. Free state tax preparation If your tax liability is reduced to zero because of other nonrefundable credits, such as the credit for child and dependent care expenses, then you will not be entitled to this credit. Free state tax preparation How to figure and report the credit. Free state tax preparation   The amount of the credit you can get is based on the contributions you make and your credit rate. Free state tax preparation Your credit rate can be as low as 10% or as high as 50%. Free state tax preparation Your credit rate depends on your income and your filing status. Free state tax preparation See Form 8880 to determine your credit rate. Free state tax preparation   The maximum contribution taken into account is $2,000 per person. Free state tax preparation On a joint return, up to $2,000 is taken into account for each spouse. Free state tax preparation   Figure the credit on Form 8880. Free state tax preparation Report the credit on line 50 of your Form 1040; line 32 of your Form 1040A; or line 47 of your Form 1040NR and attach Form 8880 to your return. Free state tax preparation Prev  Up  Next   Home   More Online Publications