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H&r Block Free State Tax E File

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H&r Block Free State Tax E File

H&r block free state tax e file 14. H&r block free state tax e file   Excise Taxes Table of Contents Introduction Topics - This chapter discusses: Useful Items - You may want to see: Fuels Used in FarmingBuyer of fuel, including undyed diesel fuel or undyed kerosene. H&r block free state tax e file Undyed diesel fuel, undyed kerosene, and Other Fuels (including alternative fuel). H&r block free state tax e file Custom application of fertilizer and pesticide. H&r block free state tax e file Fuel not used for farming. H&r block free state tax e file Dyed Diesel Fuel and Dyed Kerosene Fuels Used in Off-Highway Business Use Fuels Used for Household Purposes or Other Than as a Fuel for Propulsion Engines How To Claim a Credit or RefundCredit only. H&r block free state tax e file Claiming a Credit Claiming a Refund Including the Credit or Refund in Income Introduction You may be eligible to claim a credit on your income tax return for the federal excise tax on certain fuels. H&r block free state tax e file You may also be eligible to claim a quarterly refund of the fuel taxes during the year, instead of waiting to claim a credit on your income tax return. H&r block free state tax e file Whether you can claim a credit or refund depends on whether the fuel was taxed and the purpose (nontaxable use) for which you used the fuel. H&r block free state tax e file The nontaxable uses of fuel for which a farmer may claim a credit or refund are generally the following. H&r block free state tax e file Use on a farm for farming purposes. H&r block free state tax e file Off-highway business use. H&r block free state tax e file Uses other than as a fuel in a propulsion engine, such as home use. H&r block free state tax e file Table 14-1 presents an overview of credits and refunds that may be claimed for fuels used for the nontaxable uses listed above. H&r block free state tax e file See Publication 510, Excise Taxes, for more information. H&r block free state tax e file Topics - This chapter discusses: Fuels used in farming Dyed diesel fuel and dyed kerosene Fuels used in off-highway business use Fuels used for household purposes How to claim a credit or refund Including the credit or refund in income Useful Items - You may want to see: Publication 510 Excise Taxes Form (and Instructions) 720 Quarterly Federal Excise Tax Return 4136 Credit for Federal Tax Paid on Fuels 8849 Claim for Refund of Excise Taxes See chapter 16 for information about getting publications and forms. H&r block free state tax e file Fuels Used in Farming Owners, operators, and tenants of farms and certain other persons may be eligible to claim a credit or refund of excise taxes on fuel used in the trade or business of farming, when used on a farm in the United States for farming purposes. H&r block free state tax e file See Table 14-1 for a list of available fuel tax credits and refunds. H&r block free state tax e file Fuel is used on a farm for farming purposes only if used in carrying on a trade or business of farming, on a farm in the United States, and for farming purposes. H&r block free state tax e file Farm. H&r block free state tax e file   A farm includes livestock, dairy, fish, poultry, fruit, fur-bearing animals, and truck farms, orchards, plantations, ranches, nurseries, ranges, and feed yards for finishing cattle. H&r block free state tax e file It also includes structures such as greenhouses used primarily for raising agricultural or horticultural commodities. H&r block free state tax e file A fish farm is an area where fish are grown or raised and not merely caught or harvested. H&r block free state tax e file Table 14-1. H&r block free state tax e file Fuel Tax Credits and Refunds at a Glance Use this table to see if you can take a credit or refund for a nontaxable use of the fuel listed. H&r block free state tax e file Fuel Used On a Farm for Farming Purposes Off-Highway Business Use Household Use or Use Other Than as a Fuel1 Gasoline Credit only Credit or refund None Aviation gasoline Credit only None None Undyed diesel fuel and undyed kerosene Credit or refund Credit or refund2 Credit or refund2 Kerosene for use in aviation Credit or refund None None Dyed diesel fuel and dyed kerosene None None None Other Fuels (including alternative fuels)3 Credit or refund Credit or refund None 1For a use other than as fuel in a propulsion engine. H&r block free state tax e file 2Applies to undyed kerosene not sold from a blocked pump or, under certain circumstances, for blending with undyed diesel fuel to be used for heating purposes. H&r block free state tax e file See Reg. H&r block free state tax e file 48. H&r block free state tax e file 6427-10 (b)(1) for the definition of a blocked pump. H&r block free state tax e file 3Other Fuels means any liquid except gas oil, fuel oil, or any product taxable under Internal Revenue Code section 4081. H&r block free state tax e file It includes the alternative fuels: liquefied petroleum gas (LPG),“P” Series fuels, compressed natural gas (CNG), liquefied hydrogen, any liquid fuel derived from coal (including peat) through the Fischer-Tropsch process, liquid fuel derived from biomass, liquid natural gas (LNG), liquefied gas derived from biomass, and compressed gas derived from biomass. H&r block free state tax e file Farming purposes. H&r block free state tax e file   As the owner, tenant, or operator and the ultimate purchaser of fuel that you purchased, you use the fuel on a farm for farming purposes if you use it in any of the following ways. H&r block free state tax e file To cultivate the soil or to raise or harvest any agricultural or horticultural commodity. H&r block free state tax e file To raise, shear, feed, care for, train, or manage livestock, bees, poultry, fur-bearing animals, or wildlife. H&r block free state tax e file To operate, manage, conserve, improve, or maintain your farm and its tools and equipment. H&r block free state tax e file To handle, dry, pack, grade, or store any raw agricultural or horticultural commodity. H&r block free state tax e file For this use to qualify, you must have produced more than half the commodity so treated during the tax year. H&r block free state tax e file The more-than-one-half test applies separately to each commodity. H&r block free state tax e file Commodity means a single raw product. H&r block free state tax e file For example, apples and peaches are two separate commodities. H&r block free state tax e file To plant, cultivate, care for, or cut trees or to prepare (other than sawing logs into lumber, chipping, or other milling) trees for market, but only if these activities are incidental to your farming operations. H&r block free state tax e file Your tree operations are incidental only if they are minor in nature when compared to the total farming operations. H&r block free state tax e file   If any other person, such as a neighbor or custom operator (independent contractor), performs a service for you on your farm for any of the purposes included in list items (1) or (2), above, you are considered to be the ultimate purchaser who used the fuel on a farm for farming purposes. H&r block free state tax e file Therefore, you can still claim the credit or refund for the fuel so used. H&r block free state tax e file However, see Custom application of fertilizer and pesticide, later. H&r block free state tax e file If the other person performs any other services for you on your farm for purposes not included in list items (1) or (2) above, no one can claim the credit or refund for fuel used on your farm for those other services. H&r block free state tax e file Buyer of fuel, including undyed diesel fuel or undyed kerosene. H&r block free state tax e file   If doubt exists whether the owner, tenant, or operator of the farm bought the fuel, determine who actually bore the cost of the fuel. H&r block free state tax e file For example, if the owner of a farm and his or her tenant equally share the cost of gasoline used on the farm, each can claim a credit for the tax on half the fuel used. H&r block free state tax e file Undyed diesel fuel, undyed kerosene, and Other Fuels (including alternative fuel). H&r block free state tax e file   Usually, the farmer is the only person who can make a claim for credit or refund for the tax on undyed diesel fuel, undyed kerosene, or other fuels (including alternative fuel) used for farming purposes. H&r block free state tax e file However, see Custom application of fertilizer and pesticide, next. H&r block free state tax e file Also see Dyed Diesel Fuel and Dyed Kerosene, later. H&r block free state tax e file Example. H&r block free state tax e file Farm owner Haleigh Blue hired custom operator Tyler Steele to cultivate the soil on her farm. H&r block free state tax e file Tyler used 200 gallons of undyed diesel fuel that he purchased to perform the work on Haleigh's farm. H&r block free state tax e file In addition, Haleigh hired contractor Lee Brown to pack and store her apple crop. H&r block free state tax e file Lee bought 25 gallons of undyed diesel fuel to use in packing the apples. H&r block free state tax e file Haleigh can claim the credit for the 200 gallons of undyed diesel fuel used by Tyler on her farm because it qualifies as fuel used on the farm for farming purposes. H&r block free state tax e file No one can claim a credit for the 25 gallons used by Lee because that fuel was not used for a farming purpose included in list items (1) or (2), above. H&r block free state tax e file In the above example, both Tyler Steele and Lee Brown could have purchased dyed (untaxed) diesel fuel for their tasks. H&r block free state tax e file Custom application of fertilizer and pesticide. H&r block free state tax e file   Fuel used on a farm for farming purposes includes fuel used in the application (including aerial application) of fertilizer, pesticides, or other substances. H&r block free state tax e file Generally, the applicator is treated as having used the fuel on a farm for farming purposes. H&r block free state tax e file For applicators using highway vehicles, only the fuel used on the farm is exempt. H&r block free state tax e file Fuel used traveling on the highway to and from the farm is taxable. H&r block free state tax e file Fuel used by an aerial applicator for the direct flight between the airfield and one or more farms is treated as used for a farming purpose. H&r block free state tax e file For aviation gasoline, the aerial applicator makes the claim as the ultimate purchaser. H&r block free state tax e file For kerosene used in aviation, the ultimate purchaser may make the claim or waive the right to make the claim to the registered ultimate vendor. H&r block free state tax e file A sample waiver is included as Model Waiver L in the appendix of Publication 510. H&r block free state tax e file A registered ultimate vendor is the person who sells undyed diesel fuel, undyed kerosene, or kerosene for use in aviation to the user (ultimate purchaser) of the fuel for use on a farm for farming purposes. H&r block free state tax e file To claim a credit or refund of tax, the ultimate vendor must be registered with the Internal Revenue Service at the time the claim is made. H&r block free state tax e file However, registered ultimate vendors cannot make claims for undyed diesel fuel and undyed kerosene sold for use on a farm for farming purposes. H&r block free state tax e file Fuel not used for farming. H&r block free state tax e file   You do not use fuel on a farm for farming purposes when you use it in any of the following ways. H&r block free state tax e file Off the farm, such as on the highway or in noncommercial aviation, even if the fuel is used in transporting livestock, feed, crops, or equipment. H&r block free state tax e file For personal use, such as lawn mowing. H&r block free state tax e file In processing, packaging, freezing, or canning operations. H&r block free state tax e file In processing crude gum into gum spirits of turpentine or gum resin or in processing maple sap into maple syrup or maple sugar. H&r block free state tax e file All-terrain vehicles (ATVs). H&r block free state tax e file   Fuel used in ATVs on a farm for farming purposes, discussed earlier, is eligible for a credit or refund of excise taxes on the fuel. H&r block free state tax e file Fuel used in ATVs for nonfarming purposes is not eligible for a credit or refund of the taxes. H&r block free state tax e file If ATVs are used both for farming and nonfarming purposes, only that portion of the fuel used for farming purposes is eligible for the credit or refund. H&r block free state tax e file Dyed Diesel Fuel and Dyed Kerosene If you purchase dyed diesel fuel or dyed kerosene for a nontaxable use, you must use it only on a farm for farming purposes or for other nontaxable purposes. H&r block free state tax e file For example, you should not use dyed diesel fuel in a truck that is used both on the farm for farming purposes and on the highway, even though the highway use is in connection with farm business. H&r block free state tax e file Excise tax applies to the fuel used by the truck on the highways. H&r block free state tax e file In this situation, undyed (taxed) fuel should be purchased for the truck. H&r block free state tax e file You should keep fuel records of the use of the truck on the farm for farming purposes, and for other uses. H&r block free state tax e file You may be eligible for a credit or refund for the excise tax on fuel used on the farm for farming purposes. H&r block free state tax e file Penalty. H&r block free state tax e file   A penalty is imposed on any person who knowingly uses, sells, or alters dyed diesel fuel or dyed kerosene for any purpose other than a nontaxable use. H&r block free state tax e file The penalty is the greater of $1,000 or $10 per gallon of the dyed diesel fuel or dyed kerosene involved. H&r block free state tax e file After the first violation, the $1,000 portion of the penalty increases depending on the number of violations. H&r block free state tax e file For more information on this penalty, see Publication 510. H&r block free state tax e file Fuels Used in Off-Highway Business Use You may be eligible to claim a credit or refund for the excise tax on fuel used in an off-highway business use. H&r block free state tax e file Off-highway business use. H&r block free state tax e file   This is any use of fuel in a trade or business or in an income-producing activity. H&r block free state tax e file The use must not be in a highway vehicle registered or required to be registered for use on public highways. H&r block free state tax e file Off-highway business use generally does not include any use in a recreational motorboat. H&r block free state tax e file Examples. H&r block free state tax e file   Off-highway business use includes the use of fuels in a trade or business in any of the following ways. H&r block free state tax e file In stationary machines such as generators, compressors, power saws, and similar equipment; For cleaning ; and In forklift trucks, bulldozers, and earthmovers. H&r block free state tax e file   Off-highway nonbusiness (taxable) use of fuel includes: use in minibikes, snowmobiles, power lawn mowers, chain saws, and other yard equipment. H&r block free state tax e file For more information, see Publication 510. H&r block free state tax e file Fuels Used for Household Purposes or Other Than as a Fuel for Propulsion Engines You may be eligible to claim a credit or refund for the excise tax on undyed diesel fuel or kerosene used for home heating, lighting, and cooking. H&r block free state tax e file This also applies to diesel fuel and kerosene used in a home generator to produce electricity for home use. H&r block free state tax e file Home use of a fuel does not include use in a propulsion engine and it is not considered an off-highway business use. H&r block free state tax e file How To Claim a Credit or Refund You may be able to claim a credit or refund of the excise tax on fuels you use for nontaxable uses. H&r block free state tax e file The basic rules for claiming credits and refunds are listed in Table 14-2 . H&r block free state tax e file Table 14-2. H&r block free state tax e file Claiming a Credit or Refund of Excise Taxes This table gives the basic rules for claiming a credit or refund of excise taxes on fuels used for a nontaxable use. H&r block free state tax e file   Credit Refund Which form to use Form 4136, Credit for Federal Tax Paid on Fuels Form 8849, Claim for Refund of Excise Taxes, and Schedule 1 (Form 8849), Nontaxable Use of Fuels Type of form Annual Quarterly When to file With your income tax return By the last day of the quarter following the last quarter included in the claim Amount of tax Any amount $750 or more1 1You may carry over an amount less than $750 to the next quarter. H&r block free state tax e file Keep at your principal place of business all records needed to enable the IRS to verify that you are the person entitled to claim a credit or refund and the amount you claimed. H&r block free state tax e file You do not have to use any special form, but the records should establish the following information. H&r block free state tax e file The total number of gallons bought and used during the period covered by your claim. H&r block free state tax e file The dates of the purchases. H&r block free state tax e file The names and addresses of suppliers and amounts bought from each during the period covered by your claim. H&r block free state tax e file The nontaxable use for which you used the fuel. H&r block free state tax e file The number of gallons used for each nontaxable use. H&r block free state tax e file It is important that your records separately show the number of gallons used for each nontaxable use that qualifies as a claim. H&r block free state tax e file For more information about recordkeeping, see Publication 583, Starting a Business and Keeping Records. H&r block free state tax e file Credit or refund. H&r block free state tax e file   A credit is an amount that reduces the tax on your income tax return when you file it at the end of the year. H&r block free state tax e file If you meet certain requirements, you may claim a refund during the year instead of waiting until you file your income tax return. H&r block free state tax e file Credit only. H&r block free state tax e file   You can claim the following taxes only as a credit on your income tax return. H&r block free state tax e file Tax on gasoline and aviation gasoline you used on a farm for farming purposes. H&r block free state tax e file Tax on fuels (including undyed diesel fuel or undyed kerosene) you used for nontaxable uses if the total for the tax year is less than $750. H&r block free state tax e file Tax on fuel you did not include in any claim for refund previously filed for any quarter of the tax year. H&r block free state tax e file Claiming a Credit You make a claim for a fuel tax credit on Form 4136 and attach it to your income tax return. H&r block free state tax e file Do not claim a credit for any excise tax for which you have filed a refund claim. H&r block free state tax e file How to claim a credit. H&r block free state tax e file   How you claim a credit depends on whether you are an individual, partnership, corporation, S corporation, trust, or farmers' cooperative association. H&r block free state tax e file Individuals. H&r block free state tax e file   You claim the credit on the “Credit for federal tax on fuels” line of your Form 1040. H&r block free state tax e file If you would not otherwise have to file an income tax return, you must do so to get a fuel tax credit. H&r block free state tax e file Partnership. H&r block free state tax e file   Partnerships (other than electing large partnerships) claim the credit by including a statement on Schedule K-1 (Form 1065), Partner's Share of Income, Deductions, Credits, etc. H&r block free state tax e file , showing each partner's share of the number of gallons of each fuel sold or used for a nontaxable use, the type of use, and the applicable credit per gallon. H&r block free state tax e file Each partner claims the credit on his or her income tax return for the partner's share of the fuel used by the partnership. H&r block free state tax e file An electing large partnership can claim the credit on the “Other payments” line of Form 1065-B, U. H&r block free state tax e file S. H&r block free state tax e file Return of Income for Electing Large Partnerships. H&r block free state tax e file Other entities. H&r block free state tax e file   Corporations, S corporations, farmers' cooperative associations, and trusts make the claim on the appropriate line of their income tax return. H&r block free state tax e file When to claim a credit. H&r block free state tax e file   You can claim a fuel tax credit on your income tax return for the year you used the fuel. H&r block free state tax e file You may be able to make a fuel tax claim on an amended income tax return for the year you used the fuel. H&r block free state tax e file A claim for credit or refund of an overpayment must generally be filed within the later of: Three years from the date the original return was filed, or Two years from the date the tax was paid. H&r block free state tax e file Claiming a Refund Generally, you may claim a refund of excise taxes on Form 8849. H&r block free state tax e file Complete and attach to Form 8849 the appropriate Form 8849 schedule(s). H&r block free state tax e file The instructions for Form 8849 and the separate instructions for each schedule explain the requirements for making a claim for refund. H&r block free state tax e file If you file Form 720, you can use its Schedule C for your refund claims for the quarter. H&r block free state tax e file See the Instructions for Form 720. H&r block free state tax e file Do not claim a refund on Form 8849 for any amount for which you have filed or will file a claim on Form 720 or Form 4136. H&r block free state tax e file You may file a claim for refund for any quarter of your tax year for which you can claim $750 or more. H&r block free state tax e file This amount is the excise tax on all fuels used for a nontaxable use during that quarter or any prior quarter (for which no other claim has been filed) during the tax year. H&r block free state tax e file If you cannot claim at least $750 at the end of a quarter, you carry the amount over to the next quarter of your tax year to determine if you can claim at least $750 for that quarter. H&r block free state tax e file If you cannot claim at least $750 at the end of the fourth quarter of your tax year, you must claim a credit on your income tax return using Form 4136. H&r block free state tax e file Only one claim can be filed for a quarter. H&r block free state tax e file You cannot claim a refund for excise tax on gasoline and aviation gasoline used on a farm for farming purposes. H&r block free state tax e file You must claim a credit on your income tax return for the tax. H&r block free state tax e file How to file a quarterly claim. H&r block free state tax e file   File the claim for refund by filling out Schedule 1 (Form 8849) and attaching it to Form 8849. H&r block free state tax e file Send it to the address shown in the instructions. H&r block free state tax e file If you file Form 720, you can use its Schedule C for your refund claims. H&r block free state tax e file See the Instructions for Form 720. H&r block free state tax e file When to file a quarterly claim. H&r block free state tax e file   You must file a quarterly claim by the last day of the first quarter following the last quarter included in the claim. H&r block free state tax e file If you do not file a timely refund claim for the fourth quarter of your tax year, you will have to claim a credit for that amount on your income tax return, as discussed earlier. H&r block free state tax e file    In most situations, the amount claimed as a credit or refund will be less than the amount deducted as fuel tax expense because the Leaking Underground Storage Tank (LUST) tax of $0. H&r block free state tax e file 001 per gallon is generally not subject to credit or refund. H&r block free state tax e file Including the Credit or Refund in Income Include any credit or refund of excise taxes on fuels in your gross income if you claimed the total cost of the fuel (including the excise taxes) as an expense deduction that reduced your income tax liability. H&r block free state tax e file Which year you include a credit or refund in gross income depends on whether you use the cash or an accrual method of accounting. H&r block free state tax e file Cash method. H&r block free state tax e file   If you use the cash method and file a claim for refund, include the refund amount in gross income for the tax year in which you receive the refund. H&r block free state tax e file If you claim a credit on your income tax return, include the credit amount in gross income for the tax year in which you file Form 4136. H&r block free state tax e file If you file an amended return and claim a credit, include the credit amount in gross income for the tax year in which you receive the credit. H&r block free state tax e file Example. H&r block free state tax e file Sharon Brown, a farmer who uses the cash method, filed her 2012 Form 1040 on March 3, 2013. H&r block free state tax e file On her Schedule F, she deducted the total cost of gasoline (including $110 of excise taxes) used on the farm for farming purposes. H&r block free state tax e file Then, on Form 4136, she claimed the $110 as a credit. H&r block free state tax e file Sharon reports the $110 as other income on line 8b of her 2013 Schedule F. H&r block free state tax e file Accrual method. H&r block free state tax e file   If you use an accrual method, include the amount of credit or refund in gross income for the tax year in which you used the fuels. H&r block free state tax e file It does not matter whether you filed for a quarterly refund or claimed the entire amount as a credit. H&r block free state tax e file Example. H&r block free state tax e file Patty Green, a farmer who uses the accrual method, files her 2012 Form 1040 on April 15, 2013. H&r block free state tax e file On Schedule F, she deducts the total cost of gasoline (including $155 of excise taxes) she used on the farm for farming purposes during 2012. H&r block free state tax e file On Form 4136, Patty claims the $155 as a credit. H&r block free state tax e file She reports the $155 as other income on line 8b of her 2012 Schedule F. H&r block free state tax e file Prev  Up  Next   Home   More Online Publications

Topic 203 - Refund Offsets for Unpaid Child Support, Certain Federal and State Debts, and Unemployment Compensation Debts

The Department of Treasury's Bureau of Fiscal Service (BFS), which issues IRS tax refunds, has been authorized by Congress to conduct the Treasury Offset Program (TOP). Through this program, your refund or overpayment may be reduced by BFS and offset to pay:

  • Past-due child support;
  • Federal agency non-tax debts;
  • State income tax obligations; or
  • Certain unemployment compensation debts owed to a state. (Generally, these are debts for (1) compensation that was paid due to fraud, or (2) for contributions owing to a state fund that were not paid due to fraud).

You can contact the agency with which you have a debt to determine if your debt was submitted for a tax refund offset. You may call BFS' TOP call center at the number below for an agency address and phone number. If your debt was submitted for offset, BFS will take as much of your refund as is needed to pay off the debt and send it to the agency you owe. Any portion of your refund remaining after offset will be issued in a check to you or direct deposited for you.

BFS will send you a notice if an offset occurs. The notice will reflect the original refund amount, your offset amount, the agency receiving the payment, and the address and telephone number of the agency. BFS will notify the IRS of the amount taken from your refund. Contact the agency shown on the notice if you believe you do not owe the debt, or if you are disputing the amount taken from your refund. If a notice is not received, contact BFS' TOP call center at 800-304-3107 or TDD 866-297-0517. The available hours are Monday through Friday 7:30 a.m. to 5 p.m. CST. Contact the IRS only if your original refund amount shown on the BFS offset notice differs from the refund amount shown on your tax return.

If you filed a joint return and you are not responsible for the debt, but you are entitled to a portion of the refund, you may request your portion of the refund by filing Form 8379 (PDF), Injured Spouse Allocation. You may file Form 8379 with your original joint tax return ( Form 1040 (PDF), Form 1040A (PDF), or Form 1040EZ (PDF)), with your amended joint tax return ( Form 1040X (PDF)), or by itself after you are notified of an offset. If you file a Form 8379 with your joint return, write "INJURED SPOUSE" in the top left corner of the first page of the joint return. The IRS will process your Form 8379 before an offset occurs. If you file Form 8379 with your original or amended joint tax return, it may take 11 weeks for electronically filed returns or 14 weeks if you file a paper return, to process your return.

If you file Form 8379 by itself, it must show both spouses' social security numbers in the same order as they appeared on your joint income tax return. You, the "injured" spouse, must sign the form. Follow the instructions on Form 8379 carefully and be sure to attach the required forms to avoid delays. Do not attach the previously filed joint tax return to the Form 8379. Send Form 8379 to the Service Center where you filed your original return and allow at least 8 weeks for the IRS to process your Form 8379. The IRS will compute the injured spouse's share of the joint return, and if you lived in a community property state during the tax year, the IRS will divide the joint refund based upon state law. Not all debts are subject to a tax refund offset. To determine if a debt is owed (other than federal tax), and whether an offset will occur, contact BFS' TOP call center at 800-304-3107 (for TTY/TDD help, call 866-297-0517).

Page Last Reviewed or Updated: February 24, 2014

The H&r Block Free State Tax E File

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