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How Do You File A Tax Extension For Free

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How Do You File A Tax Extension For Free

How do you file a tax extension for free 2. How do you file a tax extension for free   Source of Income Table of Contents Introduction Topics - This chapter discusses: Resident Aliens Nonresident AliensInterest Income Dividends Guarantee of Indebtedness Personal Services Transportation Income Scholarships, Grants, Prizes, and Awards Pensions and Annuities Rents or Royalties Real Property Personal Property Community Income Introduction After you have determined your alien status, you must determine the source of your income. How do you file a tax extension for free This chapter will help you determine the source of different types of income you may receive during the tax year. How do you file a tax extension for free This chapter also discusses special rules for married individuals who are domiciled in a country with community property laws. How do you file a tax extension for free Topics - This chapter discusses: Income source rules, and Community income. How do you file a tax extension for free Resident Aliens A resident alien's income is generally subject to tax in the same manner as a U. How do you file a tax extension for free S. How do you file a tax extension for free citizen. How do you file a tax extension for free If you are a resident alien, you must report all interest, dividends, wages, or other compensation for services, income from rental property or royalties, and other types of income on your U. How do you file a tax extension for free S. How do you file a tax extension for free tax return. How do you file a tax extension for free You must report these amounts from sources within and outside the United States. How do you file a tax extension for free Nonresident Aliens A nonresident alien usually is subject to U. How do you file a tax extension for free S. How do you file a tax extension for free income tax only on U. How do you file a tax extension for free S. How do you file a tax extension for free source income. How do you file a tax extension for free Under limited circumstances, certain foreign source income is subject to U. How do you file a tax extension for free S. How do you file a tax extension for free tax. How do you file a tax extension for free See Foreign Income in chapter 4. How do you file a tax extension for free The general rules for determining U. How do you file a tax extension for free S. How do you file a tax extension for free source income that apply to most nonresident aliens are shown in Table 2-1. How do you file a tax extension for free The following discussions cover the general rules as well as the exceptions to these rules. How do you file a tax extension for free Not all items of U. How do you file a tax extension for free S. How do you file a tax extension for free source income are taxable. How do you file a tax extension for free See chapter 3. How do you file a tax extension for free Interest Income Generally, U. How do you file a tax extension for free S. How do you file a tax extension for free source interest income includes the following items. How do you file a tax extension for free Interest on bonds, notes, or other interest-bearing obligations of U. How do you file a tax extension for free S. How do you file a tax extension for free residents or domestic corporations. How do you file a tax extension for free Interest paid by a domestic or foreign partnership or foreign corporation engaged in a U. How do you file a tax extension for free S. How do you file a tax extension for free trade or business at any time during the tax year. How do you file a tax extension for free Original issue discount. How do you file a tax extension for free Interest from a state, the District of Columbia, or the U. How do you file a tax extension for free S. How do you file a tax extension for free Government. How do you file a tax extension for free The place or manner of payment is immaterial in determining the source of the income. How do you file a tax extension for free A substitute interest payment made to the transferor of a security in a securities lending transaction or a sale-repurchase transaction is sourced in the same manner as the interest on the transferred security. How do you file a tax extension for free Exceptions. How do you file a tax extension for free   U. How do you file a tax extension for free S. How do you file a tax extension for free source interest income does not include the following items. How do you file a tax extension for free Interest paid by a resident alien or a domestic corporation on obligations issued before August 10, 2010, if for the 3-year period ending with the close of the payer's tax year preceding the interest payment, at least 80% of the payer's total gross income: Is from sources outside the United States, and Is attributable to the active conduct of a trade or business by the individual or corporation in a foreign country or a U. How do you file a tax extension for free S. How do you file a tax extension for free possession. How do you file a tax extension for free However, the interest will be considered U. How do you file a tax extension for free S. How do you file a tax extension for free source interest income if either of the following apply. How do you file a tax extension for free The recipient of the interest is related to the resident alien or domestic corporation. How do you file a tax extension for free See section 954(d)(3) for the definition of related person. How do you file a tax extension for free The terms of the obligation are significantly modified after August 9, 2010. How do you file a tax extension for free Any extension of the term of the obligation is considered a significant modification. How do you file a tax extension for free Interest paid by a foreign branch of a domestic corporation or a domestic partnership on deposits or withdrawable accounts with mutual savings banks, cooperative banks, credit unions, domestic building and loan associations, and other savings institutions chartered and supervised as savings and loan or similar associations under federal or state law if the interest paid or credited can be deducted by the association. How do you file a tax extension for free Interest on deposits with a foreign branch of a domestic corporation or domestic partnership, but only if the branch is in the commercial banking business. How do you file a tax extension for free Dividends In most cases, dividend income received from domestic corporations is U. How do you file a tax extension for free S. How do you file a tax extension for free source income. How do you file a tax extension for free Dividend income from foreign corporations is usually foreign source income. How do you file a tax extension for free Exceptions to both of these rules are discussed below. How do you file a tax extension for free A substitute dividend payment made to the transferor of a security in a securities lending transaction or a sale-repurchase transaction is sourced in the same manner as a distribution on the transferred security. How do you file a tax extension for free Dividend equivalent payments. How do you file a tax extension for free   U. How do you file a tax extension for free S. How do you file a tax extension for free source dividends also include all dividend equivalent payments. How do you file a tax extension for free Dividend equivalent payments include substitute dividends, payments made pursuant to a specified notional principal contract, and all similar payments that, directly or indirectly, are contingent on or determined by reference to, the payment of a dividend from U. How do you file a tax extension for free S. How do you file a tax extension for free sources. How do you file a tax extension for free    The Internal Revenue Service has issued final regulations that would affect the treatment of dividend equivalent payments and specified notional principal contracts. How do you file a tax extension for free You can view this regulation at www. How do you file a tax extension for free irs. How do you file a tax extension for free gov/irb/2013-52_IRB/ar08. How do you file a tax extension for free html. How do you file a tax extension for free First exception. How do you file a tax extension for free   Dividends received from a domestic corporation are not U. How do you file a tax extension for free S. How do you file a tax extension for free source income if the corporation elects to take the American Samoa economic development credit. How do you file a tax extension for free Second exception. How do you file a tax extension for free   Part of the dividends received from a foreign corporation is U. How do you file a tax extension for free S. How do you file a tax extension for free source income if 25% or more of its total gross income for the 3-year period ending with the close of its tax year preceding the declaration of dividends was effectively connected with a trade or business in the United States. How do you file a tax extension for free If the corporation was formed less than 3 years before the declaration, use its total gross income from the time it was formed. How do you file a tax extension for free Determine the part that is U. How do you file a tax extension for free S. How do you file a tax extension for free source income by multiplying the dividend by the following fraction. How do you file a tax extension for free   Foreign corporation's gross income connected with a U. How do you file a tax extension for free S. How do you file a tax extension for free trade or business for the 3-year period     Foreign corporation's gross income from all sources for that period   Guarantee of Indebtedness Certain amounts received directly or indirectly, for the provision of a guarantee of indebtedness issued after September 27, 2010, are U. How do you file a tax extension for free S. How do you file a tax extension for free source income. How do you file a tax extension for free They must be paid by a noncorporate resident or U. How do you file a tax extension for free S. How do you file a tax extension for free corporation or by any foreign person if the amounts are effectively connected with the conduct of a U. How do you file a tax extension for free S. How do you file a tax extension for free trade or business. How do you file a tax extension for free For more information, see Internal Revenue Code sections 861(a)(9) and 862(a)(9). How do you file a tax extension for free Personal Services All wages and any other compensation for services performed in the United States are considered to be from sources in the United States. How do you file a tax extension for free The only exceptions to this rule are discussed in chapter 3 under Employees of foreign persons, organizations, or offices, and under Crew members. How do you file a tax extension for free If you are an employee and receive compensation for labor or personal services performed both inside and outside the United States, special rules apply in determining the source of the compensation. How do you file a tax extension for free Compensation (other than certain fringe benefits) is sourced on a time basis. How do you file a tax extension for free Certain fringe benefits (such as housing and education) are sourced on a geographical basis. How do you file a tax extension for free Or, you may be permitted to use an alternative basis to determine the source of compensation. How do you file a tax extension for free See Alternative Basis , later. How do you file a tax extension for free Multi-level marketing. How do you file a tax extension for free   Certain companies sell products through a multi-level marketing arrangement, such that an upper-tier distributor, who has sponsored a lower-tier distributor, is entitled to a payment from the company based on certain activities of that lower-tier distributor. How do you file a tax extension for free Generally, depending on the facts, payments from such multi-level marketing companies to independent (non-employee) distributors (upper-tier distributors) that are based on the sales or purchases of persons whom they have sponsored (lower-tier distributors) constitute income for the performance of personal services in recruiting, training, and supporting the lower-tier distributors. How do you file a tax extension for free The source of such income is generally based on where the services of the upper-tier distributor are performed, and may, depending on the facts, be considered multi-year compensation, with the source of income determined over the period to which such compensation is attributable. How do you file a tax extension for free Self-employed individuals. How do you file a tax extension for free   If you are self-employed, you determine the source of compensation for labor or personal services from self-employment on the basis that most correctly reflects the proper source of that income under the facts and circumstances of your particular case. How do you file a tax extension for free In many cases, the facts and circumstances will call for an apportionment on a time basis as explained next. How do you file a tax extension for free Time Basis Use a time basis to figure your U. How do you file a tax extension for free S. How do you file a tax extension for free source compensation (other than the fringe benefits discussed later). How do you file a tax extension for free Do this by multiplying your total compensation (other than the fringe benefits discussed later) by the following fraction:   Number of days you performed services in the United States during the year     Total number of days you performed services during the year   You can use a unit of time less than a day in the above fraction, if appropriate. How do you file a tax extension for free The time period for which the compensation is made does not have to be a year. How do you file a tax extension for free Instead, you can use another distinct, separate, and continuous time period if you can establish to the satisfaction of the IRS that this other period is more appropriate. How do you file a tax extension for free Example 1. How do you file a tax extension for free Christina Brooks, a resident of the Netherlands, worked 240 days for a U. How do you file a tax extension for free S. How do you file a tax extension for free company during the tax year. How do you file a tax extension for free She received $80,000 in compensation. How do you file a tax extension for free None of it was for fringe benefits. How do you file a tax extension for free Christina performed services in the United States for 60 days and performed services in the Netherlands for 180 days. How do you file a tax extension for free Using the time basis for determining the source of compensation, $20,000 ($80,000 × 60/240) is her U. How do you file a tax extension for free S. How do you file a tax extension for free source income. How do you file a tax extension for free Example 2. How do you file a tax extension for free Rob Waters, a resident of South Africa, is employed by a corporation. How do you file a tax extension for free His annual salary is $100,000. How do you file a tax extension for free None of it is for fringe benefits. How do you file a tax extension for free During the first quarter of the year he worked entirely within the United States. How do you file a tax extension for free On April 1, Rob was transferred to Singapore for the remainder of the year. How do you file a tax extension for free Rob is able to establish that the first quarter of the year and the last 3 quarters of the year are two separate, distinct, and continuous periods of time. How do you file a tax extension for free Accordingly, $25,000 of Rob's annual salary is attributable to the first quarter of the year (. How do you file a tax extension for free 25 × $100,000). How do you file a tax extension for free All of it is U. How do you file a tax extension for free S. How do you file a tax extension for free source income because he worked entirely within the United States during that quarter. How do you file a tax extension for free The remaining $75,000 is attributable to the last three quarters of the year. How do you file a tax extension for free During those quarters, he worked 150 days in Singapore and 30 days in the United States. How do you file a tax extension for free His periodic performance of services in the United States did not result in distinct, separate, and continuous periods of time. How do you file a tax extension for free Of this $75,000, $12,500 ($75,000 × 30/180) is U. How do you file a tax extension for free S. How do you file a tax extension for free source income. How do you file a tax extension for free Multi-year compensation. How do you file a tax extension for free   The source of multi-year compensation is generally determined on a time basis over the period to which the compensation is attributable. How do you file a tax extension for free Multi-year compensation is compensation that is included in your income in one tax year but that is attributable to a period that includes two or more tax years. How do you file a tax extension for free   You determine the period to which the compensation is attributable based on the facts and circumstances of your case. How do you file a tax extension for free For example, an amount of compensation that specifically relates to a period of time that includes several calendar years is attributable to the entire multi-year period. How do you file a tax extension for free   The amount of compensation treated as from U. How do you file a tax extension for free S. How do you file a tax extension for free sources is figured by multiplying the total multi-year compensation by a fraction. How do you file a tax extension for free The numerator of the fraction is the number of days (or unit of time less than a day, if appropriate) that you performed labor or personal services in the United States in connection with the project. How do you file a tax extension for free The denominator of the fraction is the total number of days (or unit of time less than a day, if appropriate) that you performed labor or personal services in connection with the project. How do you file a tax extension for free Geographical Basis Compensation you receive as an employee in the form of the following fringe benefits is sourced on a geographical basis. How do you file a tax extension for free Housing. How do you file a tax extension for free Education. How do you file a tax extension for free Local transportation. How do you file a tax extension for free Tax reimbursement. How do you file a tax extension for free Hazardous or hardship duty pay as defined in Regulations section 1. How do you file a tax extension for free 861-4(b)(2)(ii)(D)(5). How do you file a tax extension for free Moving expense reimbursement. How do you file a tax extension for free The amount of fringe benefits must be reasonable and you must substantiate them by adequate records or by sufficient evidence. How do you file a tax extension for free Principal place of work. How do you file a tax extension for free   The above fringe benefits, except for tax reimbursement and hazardous or hardship duty pay, are sourced based on your principal place of work. How do you file a tax extension for free Your principal place of work is usually the place where you spend most of your working time. How do you file a tax extension for free This could be your office, plant, store, shop, or other location. How do you file a tax extension for free If there is no one place where you spend most of your working time, your main job location is the place where your work is centered, such as where you report for work or are otherwise required to “base” your work. How do you file a tax extension for free   If you have more than one job at any time, your main job location depends on the facts in each case. How do you file a tax extension for free The more important factors to be considered are: The total time you spend at each place, The amount of work you do at each place, and How much money you earn at each place. How do you file a tax extension for free Housing. How do you file a tax extension for free   The source of a housing fringe benefit is determined based on the location of your principal place of work. How do you file a tax extension for free A housing fringe benefit includes payments to you or on your behalf (and your family's if your family resides with you) only for the following. How do you file a tax extension for free Rent. How do you file a tax extension for free Utilities (except telephone charges). How do you file a tax extension for free Real and personal property insurance. How do you file a tax extension for free Occupancy taxes not deductible under section 164 or 216(a). How do you file a tax extension for free Nonrefundable fees for securing a leasehold. How do you file a tax extension for free Rental of furniture and accessories. How do you file a tax extension for free Household repairs. How do you file a tax extension for free Residential parking. How do you file a tax extension for free Fair rental value of housing provided in kind by your employer. How do you file a tax extension for free   A housing fringe benefit does not include: Deductible interest and taxes (including deductible interest and taxes of a tenant-stockholder in a cooperative housing corporation), The cost of buying property, including principal payments on a mortgage, The cost of domestic labor (maids, gardeners, etc. How do you file a tax extension for free ), Pay television subscriptions, Improvements and other expenses that increase the value or appreciably prolong the life of property, Purchased furniture or accessories, Depreciation or amortization of property or improvements, The value of meals or lodging that you exclude from gross income, or The value of meals or lodging that you deduct as moving expenses. How do you file a tax extension for free Education. How do you file a tax extension for free   The source of an education fringe benefit for the education expenses of your dependents is determined based on the location of your principal place of work. How do you file a tax extension for free An education fringe benefit includes payments only for the following expenses for education at an elementary or secondary school. How do you file a tax extension for free Tuition, fees, academic tutoring, special needs services for a special needs student, books, supplies, and other equipment. How do you file a tax extension for free Room and board and uniforms that are required or provided by the school in connection with enrollment or attendance. How do you file a tax extension for free Local transportation. How do you file a tax extension for free   The source of a local transportation fringe benefit is determined based on the location of your principal place of work. How do you file a tax extension for free Your local transportation fringe benefit is the amount that you receive as compensation for local transportation for you or your spouse or dependents at the location of your principal place of work. How do you file a tax extension for free The amount treated as a local transportation fringe benefit is limited to actual expenses incurred for local transportation and the fair rental value of any employer-provided vehicle used predominantly by you, your spouse, or your dependents for local transportation. How do you file a tax extension for free Actual expenses do not include the cost (including interest) of any vehicle purchased by you or on your behalf. How do you file a tax extension for free Tax reimbursement. How do you file a tax extension for free   The source of a tax reimbursement fringe benefit is determined based on the location of the jurisdiction that imposed the tax for which you are reimbursed. How do you file a tax extension for free Moving expense reimbursement. How do you file a tax extension for free   The source of a moving expense reimbursement is generally based on the location of your new principal place of work. How do you file a tax extension for free However, the source is determined based on the location of your former principal place of work if you provide sufficient evidence that such determination of source is more appropriate under the facts and circumstances of your case. How do you file a tax extension for free Sufficient evidence generally requires an agreement between you and your employer, or a written statement of company policy, which is reduced to writing before the move and which is entered into or established to induce you or other employees to move to another country. How do you file a tax extension for free The written statement or agreement must state that your employer will reimburse you for moving expenses that you incur to return to your former principal place of work regardless of whether you continue to work for your employer after returning to that location. How do you file a tax extension for free It may contain certain conditions upon which the right to reimbursement is determined as long as those conditions set forth standards that are definitely ascertainable and can only be fulfilled prior to, or through completion of, your return move to your former principal place of work. How do you file a tax extension for free Alternative Basis If you are an employee, you can determine the source of your compensation under an alternative basis if you establish to the satisfaction of the IRS that, under the facts and circumstances of your case, the alternative basis more properly determines the source of your compensation than the time or geographical basis. How do you file a tax extension for free If you use an alternative basis, you must keep (and have available for inspection) records to document why the alternative basis more properly determines the source of your compensation. How do you file a tax extension for free Also, if your total compensation from all sources is $250,000 or more, check “Yes” to both questions on line K on page 5 of Form 1040NR, and attach a written statement to your tax return that sets forth all of the following. How do you file a tax extension for free Your name and social security number (written across the top of the statement). How do you file a tax extension for free The specific compensation income, or the specific fringe benefit, for which you are using the alternative basis. How do you file a tax extension for free For each item in (2), the alternative basis of allocation of source used. How do you file a tax extension for free For each item in (2), a computation showing how the alternative allocation was computed. How do you file a tax extension for free A comparison of the dollar amount of the U. How do you file a tax extension for free S. How do you file a tax extension for free compensation and foreign compensation sourced under both the alternative basis and the time or geographical basis discussed earlier. How do you file a tax extension for free Transportation Income Transportation income is income from the use of a vessel or aircraft or for the performance of services directly related to the use of any vessel or aircraft. How do you file a tax extension for free This is true whether the vessel or aircraft is owned, hired, or leased. How do you file a tax extension for free The term “vessel or aircraft” includes any container used in connection with a vessel or aircraft. How do you file a tax extension for free All income from transportation that begins and ends in the United States is treated as derived from sources in the United States. How do you file a tax extension for free If the transportation begins or ends in the United States, 50% of the transportation income is treated as derived from sources in the United States. How do you file a tax extension for free For transportation income from personal services, 50% of the income is U. How do you file a tax extension for free S. How do you file a tax extension for free source income if the transportation is between the United States and a U. How do you file a tax extension for free S. How do you file a tax extension for free possession. How do you file a tax extension for free For nonresident aliens, this only applies to income derived from, or in connection with, an aircraft. How do you file a tax extension for free For information on how U. How do you file a tax extension for free S. How do you file a tax extension for free source transportation income is taxed, see chapter 4. How do you file a tax extension for free Scholarships, Grants, Prizes, and Awards Generally, the source of scholarships, fellowship grants, grants, prizes, and awards is the residence of the payer regardless of who actually disburses the funds. How do you file a tax extension for free However, see Activities to be performed outside the United States , later. How do you file a tax extension for free For example, payments for research or study in the United States made by the United States, a noncorporate U. How do you file a tax extension for free S. How do you file a tax extension for free resident, or a domestic corporation, are from U. How do you file a tax extension for free S. How do you file a tax extension for free sources. How do you file a tax extension for free Similar payments from a foreign government or foreign corporation are foreign source payments even though the funds may be disbursed through a U. How do you file a tax extension for free S. How do you file a tax extension for free agent. How do you file a tax extension for free Payments made by an entity designated as a public international organization under the International Organizations Immunities Act are from foreign sources. How do you file a tax extension for free Activities to be performed outside the United States. How do you file a tax extension for free   Scholarships, fellowship grants, targeted grants, and achievement awards received by nonresident aliens for activities performed, or to be performed, outside the United States are not U. How do you file a tax extension for free S. How do you file a tax extension for free source income. How do you file a tax extension for free    These rules do not apply to amounts paid as salary or other compensation for services. How do you file a tax extension for free See Personal Services, earlier, for the source rules that apply. How do you file a tax extension for free Pensions and Annuities If you receive a pension from a domestic trust for services performed both in and outside the United States, part of the pension payment is from U. How do you file a tax extension for free S. How do you file a tax extension for free sources. How do you file a tax extension for free That part is the amount attributable to earnings of the pension plan and the employer contributions made for services performed in the United States. How do you file a tax extension for free This applies whether the distribution is made under a qualified or nonqualified stock bonus, pension, profit-sharing, or annuity plan (whether or not funded). How do you file a tax extension for free If you performed services as an employee of the United States, you may receive a distribution from the U. How do you file a tax extension for free S. How do you file a tax extension for free Government under a plan, such as the Civil Service Retirement System, that is treated as a qualified pension plan. How do you file a tax extension for free Your U. How do you file a tax extension for free S. How do you file a tax extension for free source income is the otherwise taxable amount of the distribution that is attributable to your total U. How do you file a tax extension for free S. How do you file a tax extension for free Government basic pay other than tax-exempt pay for services performed outside the United States. How do you file a tax extension for free Rents or Royalties Your U. How do you file a tax extension for free S. How do you file a tax extension for free source income includes rent and royalty income received during the tax year from property located in the United States or from any interest in that property. How do you file a tax extension for free U. How do you file a tax extension for free S. How do you file a tax extension for free source income also includes rents or royalties for the use of, or for the privilege of using, in the United States, intangible property such as patents, copyrights, secret processes and formulas, goodwill, trademarks, franchises, and similar property. How do you file a tax extension for free Real Property Real property is land and buildings and generally anything built on, growing on, or attached to land. How do you file a tax extension for free Gross income from sources in the United States includes gains, profits, and income from the sale or other disposition of real property located in the United States. How do you file a tax extension for free Natural resources. How do you file a tax extension for free   The income from the sale of products of any farm, mine, oil or gas well, other natural deposit, or timber located in the United States and sold in a foreign country, or located in a foreign country and sold in the United States, is partly from sources in the United States. How do you file a tax extension for free For information on determining that part, see section 1. How do you file a tax extension for free 863-1(b) of the regulations. How do you file a tax extension for free Table 2-1. How do you file a tax extension for free Summary of Source Rules for Income of Nonresident Aliens Item of income Factor determining source Salaries, wages, other compensation Where services performed Business income:   Personal services Where services performed Sale of inventory—purchased Where sold Sale of inventory—produced Allocation Interest Residence of payer Dividends Whether a U. How do you file a tax extension for free S. How do you file a tax extension for free or foreign corporation* Rents Location of property Royalties:   Natural resources Location of property Patents, copyrights, etc. How do you file a tax extension for free Where property is used Sale of real property Location of property Sale of personal property Seller's tax home (but see Personal Property , later, for exceptions) Pension distributions attributable to contributions Where services were performed that earned the pension Investment earnings on pension contributions Location of pension trust Sale of natural resources Allocation based on fair market value of product at export terminal. How do you file a tax extension for free For more information, see section 1. How do you file a tax extension for free 863-1(b) of the regulations. How do you file a tax extension for free *Exceptions include: a) Dividends paid by a U. How do you file a tax extension for free S. How do you file a tax extension for free corporation are foreign source if the corporation elects the  American Samoa economic development credit. How do you file a tax extension for free  b) Part of a dividend paid by a foreign corporation is U. How do you file a tax extension for free S. How do you file a tax extension for free source if at least 25% of the  corporation's gross income is effectively connected with a U. How do you file a tax extension for free S. How do you file a tax extension for free trade or business for the  3 tax years before the year in which the dividends are declared. How do you file a tax extension for free Personal Property Personal property is property, such as machinery, equipment, or furniture, that is not real property. How do you file a tax extension for free Gain or loss from the sale or exchange of personal property generally has its source in the United States if you have a tax home in the United States. How do you file a tax extension for free If you do not have a tax home in the United States, the gain or loss generally is considered to be from sources outside the United States. How do you file a tax extension for free Tax home. How do you file a tax extension for free   Your tax home is the general area of your main place of business, employment, or post of duty, regardless of where you maintain your family home. How do you file a tax extension for free Your tax home is the place where you permanently or indefinitely work as an employee or a self-employed individual. How do you file a tax extension for free If you do not have a regular or main place of business because of the nature of your work, then your tax home is the place where you regularly live. How do you file a tax extension for free If you do not fit either of these categories, you are considered an itinerant and your tax home is wherever you work. How do you file a tax extension for free Inventory property. How do you file a tax extension for free   Inventory property is personal property that is stock in trade or that is held primarily for sale to customers in the ordinary course of your trade or business. How do you file a tax extension for free Income from the sale of inventory that you purchased is sourced where the property is sold. How do you file a tax extension for free Generally, this is where title to the property passes to the buyer. How do you file a tax extension for free For example, income from the sale of inventory in the United States is U. How do you file a tax extension for free S. How do you file a tax extension for free source income, whether you purchased it in the United States or in a foreign country. How do you file a tax extension for free   Income from the sale of inventory property that you produced in the United States and sold outside the United States (or vice versa) is partly from sources in the United States and partly from sources outside the United States. How do you file a tax extension for free For information on making this allocation, see section 1. How do you file a tax extension for free 863-3 of the regulations. How do you file a tax extension for free   These rules apply even if your tax home is not in the United States. How do you file a tax extension for free Depreciable property. How do you file a tax extension for free   To determine the source of any gain from the sale of depreciable personal property, you must first figure the part of the gain that is not more than the total depreciation adjustments on the property. How do you file a tax extension for free You allocate this part of the gain to sources in the United States based on the ratio of U. How do you file a tax extension for free S. How do you file a tax extension for free depreciation adjustments to total depreciation adjustments. How do you file a tax extension for free The rest of this part of the gain is considered to be from sources outside the United States. How do you file a tax extension for free   For this purpose, “U. How do you file a tax extension for free S. How do you file a tax extension for free depreciation adjustments” are the depreciation adjustments to the basis of the property that are allowable in figuring taxable income from U. How do you file a tax extension for free S. How do you file a tax extension for free sources. How do you file a tax extension for free However, if the property is used predominantly in the United States during a tax year, all depreciation deductions allowable for that year are treated as U. How do you file a tax extension for free S. How do you file a tax extension for free depreciation adjustments. How do you file a tax extension for free But there are some exceptions for certain transportation, communications, and other property used internationally. How do you file a tax extension for free   Gain from the sale of depreciable property that is more than the total depreciation adjustments on the property is sourced as if the property were inventory property, as discussed above. How do you file a tax extension for free   A loss is sourced in the same way as the depreciation deductions were sourced. How do you file a tax extension for free However, if the property was used predominantly in the United States, the entire loss reduces U. How do you file a tax extension for free S. How do you file a tax extension for free source income. How do you file a tax extension for free   The basis of property usually means the cost (money plus the fair market value of other property or services) of property you acquire. How do you file a tax extension for free Depreciation is an amount deducted to recover the cost or other basis of a trade or business asset. How do you file a tax extension for free The amount you can deduct depends on the property's cost, when you began using the property, how long it will take to recover your cost, and which depreciation method you use. How do you file a tax extension for free A depreciation deduction is any deduction for depreciation or amortization or any other allowable deduction that treats a capital expenditure as a deductible expense. How do you file a tax extension for free Intangible property. How do you file a tax extension for free   Intangible property includes patents, copyrights, secret processes or formulas, goodwill, trademarks, trade names, or other like property. How do you file a tax extension for free The gain from the sale of amortizable or depreciable intangible property, up to the previously allowable amortization or depreciation deductions, is sourced in the same way as the original deductions were sourced. How do you file a tax extension for free This is the same as the source rule for gain from the sale of depreciable property. How do you file a tax extension for free See Depreciable property , earlier, for details on how to apply this rule. How do you file a tax extension for free   Gain in excess of the amortization or depreciation deductions is sourced in the country where the property is used if the income from the sale is contingent on the productivity, use, or disposition of that property. How do you file a tax extension for free If the income is not contingent on the productivity, use, or disposition of the property, the income is sourced according to your tax home as discussed earlier. How do you file a tax extension for free If payments for goodwill do not depend on its productivity, use, or disposition, their source is the country in which the goodwill was generated. How do you file a tax extension for free Sales through offices or fixed places of business. How do you file a tax extension for free   Despite any of the earlier rules, if you do not have a tax home in the United States, but you maintain an office or other fixed place of business in the United States, treat the income from any sale of personal property (including inventory property) that is attributable to that office or place of business as U. How do you file a tax extension for free S. How do you file a tax extension for free source income. How do you file a tax extension for free However, this rule does not apply to sales of inventory property for use, disposition, or consumption outside the United States if your office or other fixed place of business outside the United States materially participated in the sale. How do you file a tax extension for free   If you have a tax home in the United States but maintain an office or other fixed place of business outside the United States, income from sales of personal property, other than inventory, depreciable property, or intangibles, that is attributable to that foreign office or place of business may be treated as U. How do you file a tax extension for free S. How do you file a tax extension for free source income. How do you file a tax extension for free The income is treated as U. How do you file a tax extension for free S. How do you file a tax extension for free source income if an income tax of less than 10% of the income from the sale is paid to a foreign country. How do you file a tax extension for free This rule also applies to losses if the foreign country would have imposed an income tax of less than 10% had the sale resulted in a gain. How do you file a tax extension for free Community Income If you are married and you or your spouse is subject to the community property laws of a foreign country, a U. How do you file a tax extension for free S. How do you file a tax extension for free state, or a U. How do you file a tax extension for free S. How do you file a tax extension for free possession, you generally must follow those laws to determine the income of yourself and your spouse for U. How do you file a tax extension for free S. How do you file a tax extension for free tax purposes. How do you file a tax extension for free But you must disregard certain community property laws if: Both you and your spouse are nonresident aliens, or One of you is a nonresident alien and the other is a U. How do you file a tax extension for free S. How do you file a tax extension for free citizen or resident and you do not both choose to be treated as U. How do you file a tax extension for free S. How do you file a tax extension for free residents as explained in chapter 1. How do you file a tax extension for free In these cases, you and your spouse must report community income as explained later. How do you file a tax extension for free Earned income. How do you file a tax extension for free   Earned income of a spouse, other than trade or business income and a partner's distributive share of partnership income, is treated as the income of the spouse whose services produced the income. How do you file a tax extension for free That spouse must report all of it on his or her separate return. How do you file a tax extension for free Trade or business income. How do you file a tax extension for free   Trade or business income, other than a partner's distributive share of partnership income, is treated as the income of the spouse carrying on the trade or business. How do you file a tax extension for free That spouse must report all of it on his or her separate return. How do you file a tax extension for free Partnership income (or loss). How do you file a tax extension for free   A partner's distributive share of partnership income (or loss) is treated as the income (or loss) of the partner. How do you file a tax extension for free The partner must report all of it on his or her separate return. How do you file a tax extension for free Separate property income. How do you file a tax extension for free   Income derived from the separate property of one spouse (and which is not earned income, trade or business income, or partnership distributive share income) is treated as the income of that spouse. How do you file a tax extension for free That spouse must report all of it on his or her separate return. How do you file a tax extension for free Use the appropriate community property law to determine what is separate property. How do you file a tax extension for free Other community income. How do you file a tax extension for free   All other community income is treated as provided by the applicable community property laws. How do you file a tax extension for free Prev  Up  Next   Home   More Online Publications
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The Health Coverage Tax Credit (HCTC) Program

The HCTC made health insurance more affordable for eligible individuals and their families by paying a significant portion of qualified health insurance premiums for tax years 2002 through 2013. 

HCTC Latest News and Background
Important Update:  The legislation that authorized the Health Coverage Tax Credit (HCTC) has expired. The tax credit is not available for tax years after 2013. 

HCTC Eligibility Requirements and How to Claim the HCTC
On this page you can find general requirements, as well as information about claiming the HCTC on your federal income tax return.

HCTC Information for our Partners
The HCTC Program partnered with companies, unions, the Department of Labor, state workforce agencies, Pension Benefit Guaranty Corporation (PBGC), and tax professionals to administer the HCTC. Health Plan Administrators (HPAs) can also access this page to find helpful information on returning funds to the HCTC Program.

HCTC Information for Tax Professionals
Tax Professionals can find information on how they can help yearly filers claim the HCTC on their federal income tax return.  

HCTC Quick References
You can find HCTC-related information including contact information, a glossary of common terms, frequently asked questions, a link to our state-qualified health plans, and additional resources.

For more information about the HCTC, please contact us.

Page Last Reviewed or Updated: 01-Jan-2014

The How Do You File A Tax Extension For Free

How do you file a tax extension for free 1. How do you file a tax extension for free   Traditional IRAs Table of Contents What's New for 2013 What's New for 2014 Introduction Who Can Open a Traditional IRA?What Is Compensation? When Can a Traditional IRA Be Opened? How Can a Traditional IRA Be Opened?Individual Retirement Account Individual Retirement Annuity Individual Retirement Bonds Simplified Employee Pension (SEP) Employer and Employee Association Trust Accounts Required Disclosures How Much Can Be Contributed?Limit. How do you file a tax extension for free When repayment contributions can be made. How do you file a tax extension for free No deduction. How do you file a tax extension for free Reserve component. How do you file a tax extension for free Figuring your IRA deduction. How do you file a tax extension for free Reporting the repayment. How do you file a tax extension for free Example. How do you file a tax extension for free General Limit Kay Bailey Hutchison Spousal IRA Limit Filing Status Less Than Maximum Contributions More Than Maximum Contributions When Can Contributions Be Made? How Much Can You Deduct?Kay Bailey Hutchison Spousal IRA. How do you file a tax extension for free Are You Covered by an Employer Plan? Limit if Covered by Employer Plan Reporting Deductible Contributions Nondeductible Contributions Examples — Worksheet for Reduced IRA Deduction for 2013 What if You Inherit an IRA?Treating it as your own. How do you file a tax extension for free Can You Move Retirement Plan Assets?Transfers to Roth IRAs from other retirement plans. How do you file a tax extension for free Trustee-to-Trustee Transfer Rollovers Transfers Incident To Divorce Converting From Any Traditional IRA Into a Roth IRA Recharacterizations When Can You Withdraw or Use Assets?Contributions Returned Before Due Date of Return When Must You Withdraw Assets? (Required Minimum Distributions)IRA Owners IRA Beneficiaries Which Table Do You Use To Determine Your Required Minimum Distribution? What Age(s) Do You Use With the Table(s)? Miscellaneous Rules for Required Minimum Distributions Are Distributions Taxable?January 2013 QCDs treated as made in 2012. How do you file a tax extension for free 2013 Reporting. How do you file a tax extension for free Additional reporting requirements if you made the election to treat a January 2013 QCD as made in 2012. How do you file a tax extension for free One-time transfer. How do you file a tax extension for free Testing period rules apply. How do you file a tax extension for free More information. How do you file a tax extension for free Distributions Fully or Partly Taxable Figuring the Nontaxable and Taxable Amounts Recognizing Losses on Traditional IRA Investments Other Special IRA Distribution Situations Reporting and Withholding Requirements for Taxable Amounts What Acts Result in Penalties or Additional Taxes?Prohibited Transactions Investment in Collectibles Excess Contributions Early Distributions Excess Accumulations (Insufficient Distributions) Reporting Additional Taxes What's New for 2013 Traditional IRA contribution and deduction limit. How do you file a tax extension for free  The contribution limit to your traditional IRA for 2013 will be increased to the smaller of the following amounts: $5,500, or Your taxable compensation for the year. How do you file a tax extension for free If you were age 50 or older before 2014, the most that can be contributed to your traditional IRA for 2013 will be the smaller of the following amounts: $6,500, or Your taxable compensation for the year. How do you file a tax extension for free For more information, see How Much Can Be Contributed? in this chapter. How do you file a tax extension for free Modified AGI limit for traditional IRA contributions increased. How do you file a tax extension for free  For 2013, if you were covered by a retirement plan at work, your deduction for contributions to a traditional IRA is reduced (phased out) if your modified AGI is: More than $95,000 but less than $115,000 for a married couple filing a joint return or a qualifying widow(er), More than $59,000 but less than $69,000 for a single individual or head of household, or Less than $10,000 for a married individual filing a separate return. How do you file a tax extension for free If you either lived with your spouse or file a joint return, and your spouse was covered by a retirement plan at work, but you were not, your deduction is phased out if your modified AGI is more than $178,000 but less than $188,000. How do you file a tax extension for free If your modified AGI is $188,000 or more, you cannot take a deduction for contributions to a traditional IRA. How do you file a tax extension for free See How Much Can You Deduct? in this chapter. How do you file a tax extension for free Net Investment Income Tax. How do you file a tax extension for free  For purposes of the Net Investment Income Tax (NIIT), net investment income does not include distributions from a qualified retirement plan (for example, 401(a), 403(a), 403(b), 457(b) plans, and IRAs). How do you file a tax extension for free However, these distributions are taken into account when determining the modified adjusted gross income threshold. How do you file a tax extension for free Distributions from a nonqualified retirement plan are included in net investment income. How do you file a tax extension for free See Form 8960, Net Investment Income Tax—Individuals, Estates, and Trusts, and its instructions for more information. How do you file a tax extension for free What's New for 2014 Modified AGI limit for traditional IRA contributions increased. How do you file a tax extension for free  For 2014, if you are covered by a retirement plan at work, your deduction for contributions to a traditional IRA is reduced (phased out) if your modified AGI is: More than $96,000 but less than $116,000 for a married couple filing a joint return or a qualifying widow(er), More than $60,000 but less than $70,000 for a single individual or head of household, or Less than $10,000 for a married individual filing a separate return. How do you file a tax extension for free If you either live with your spouse or file a joint return, and your spouse is covered by a retirement plan at work, but you are not, your deduction is phased out if your modified AGI is more than $181,000 but less than $191,000. How do you file a tax extension for free If your modified AGI is $191,000 or more, you cannot take a deduction for contributions to a traditional IRA. How do you file a tax extension for free Introduction This chapter discusses the original IRA. How do you file a tax extension for free In this publication the original IRA (sometimes called an ordinary or regular IRA) is referred to as a “traditional IRA. How do you file a tax extension for free ” A traditional IRA is any IRA that is not a Roth IRA or a SIMPLE IRA. How do you file a tax extension for free The following are two advantages of a traditional IRA: You may be able to deduct some or all of your contributions to it, depending on your circumstances. How do you file a tax extension for free Generally, amounts in your IRA, including earnings and gains, are not taxed until they are distributed. How do you file a tax extension for free Who Can Open a Traditional IRA? You can open and make contributions to a traditional IRA if: You (or, if you file a joint return, your spouse) received taxable compensation during the year, and You were not age 70½ by the end of the year. How do you file a tax extension for free You can have a traditional IRA whether or not you are covered by any other retirement plan. How do you file a tax extension for free However, you may not be able to deduct all of your contributions if you or your spouse is covered by an employer retirement plan. How do you file a tax extension for free See How Much Can You Deduct , later. How do you file a tax extension for free Both spouses have compensation. How do you file a tax extension for free   If both you and your spouse have compensation and are under age 70½, each of you can open an IRA. How do you file a tax extension for free You cannot both participate in the same IRA. How do you file a tax extension for free If you file a joint return, only one of you needs to have compensation. How do you file a tax extension for free What Is Compensation? Generally, compensation is what you earn from working. How do you file a tax extension for free For a summary of what compensation does and does not include, see Table 1-1. How do you file a tax extension for free Compensation includes all of the items discussed next (even if you have more than one type). How do you file a tax extension for free Wages, salaries, etc. How do you file a tax extension for free   Wages, salaries, tips, professional fees, bonuses, and other amounts you receive for providing personal services are compensation. How do you file a tax extension for free The IRS treats as compensation any amount properly shown in box 1 (Wages, tips, other compensation) of Form W-2, Wage and Tax Statement, provided that amount is reduced by any amount properly shown in box 11 (Nonqualified plans). How do you file a tax extension for free Scholarship and fellowship payments are compensation for IRA purposes only if shown in box 1 of Form W-2. How do you file a tax extension for free Commissions. How do you file a tax extension for free   An amount you receive that is a percentage of profits or sales price is compensation. How do you file a tax extension for free Self-employment income. How do you file a tax extension for free   If you are self-employed (a sole proprietor or a partner), compensation is the net earnings from your trade or business (provided your personal services are a material income-producing factor) reduced by the total of: The deduction for contributions made on your behalf to retirement plans, and The deduction allowed for the deductible part of your self-employment taxes. How do you file a tax extension for free   Compensation includes earnings from self-employment even if they are not subject to self-employment tax because of your religious beliefs. How do you file a tax extension for free Self-employment loss. How do you file a tax extension for free   If you have a net loss from self-employment, do not subtract the loss from your salaries or wages when figuring your total compensation. How do you file a tax extension for free Alimony and separate maintenance. How do you file a tax extension for free   For IRA purposes, compensation includes any taxable alimony and separate maintenance payments you receive under a decree of divorce or separate maintenance. How do you file a tax extension for free Nontaxable combat pay. How do you file a tax extension for free   If you were a member of the U. How do you file a tax extension for free S. How do you file a tax extension for free Armed Forces, compensation includes any nontaxable combat pay you received. How do you file a tax extension for free This amount should be reported in box 12 of your 2013 Form W-2 with code Q. How do you file a tax extension for free Table 1-1. How do you file a tax extension for free Compensation for Purposes of an IRA Includes . How do you file a tax extension for free . How do you file a tax extension for free . How do you file a tax extension for free Does not include . How do you file a tax extension for free . How do you file a tax extension for free . How do you file a tax extension for free   earnings and profits from property. How do you file a tax extension for free wages, salaries, etc. How do you file a tax extension for free     interest and dividend income. How do you file a tax extension for free commissions. How do you file a tax extension for free     pension or annuity income. How do you file a tax extension for free self-employment income. How do you file a tax extension for free     deferred compensation. How do you file a tax extension for free alimony and separate maintenance. How do you file a tax extension for free     income from certain  partnerships. How do you file a tax extension for free nontaxable combat pay. How do you file a tax extension for free     any amounts you exclude from income. How do you file a tax extension for free     What Is Not Compensation? Compensation does not include any of the following items. How do you file a tax extension for free Earnings and profits from property, such as rental income, interest income, and dividend income. How do you file a tax extension for free Pension or annuity income. How do you file a tax extension for free Deferred compensation received (compensation payments postponed from a past year). How do you file a tax extension for free Income from a partnership for which you do not provide services that are a material income-producing factor. How do you file a tax extension for free Conservation Reserve Program (CRP) payments reported on Schedule SE (Form 1040), line 1b. How do you file a tax extension for free Any amounts (other than combat pay) you exclude from income, such as foreign earned income and housing costs. How do you file a tax extension for free When Can a Traditional IRA Be Opened? You can open a traditional IRA at any time. How do you file a tax extension for free However, the time for making contributions for any year is limited. How do you file a tax extension for free See When Can Contributions Be Made , later. How do you file a tax extension for free How Can a Traditional IRA Be Opened? You can open different kinds of IRAs with a variety of organizations. How do you file a tax extension for free You can open an IRA at a bank or other financial institution or with a mutual fund or life insurance company. How do you file a tax extension for free You can also open an IRA through your stockbroker. How do you file a tax extension for free Any IRA must meet Internal Revenue Code requirements. How do you file a tax extension for free The requirements for the various arrangements are discussed below. How do you file a tax extension for free Kinds of traditional IRAs. How do you file a tax extension for free   Your traditional IRA can be an individual retirement account or annuity. How do you file a tax extension for free It can be part of either a simplified employee pension (SEP) or an employer or employee association trust account. How do you file a tax extension for free Individual Retirement Account An individual retirement account is a trust or custodial account set up in the United States for the exclusive benefit of you or your beneficiaries. How do you file a tax extension for free The account is created by a written document. How do you file a tax extension for free The document must show that the account meets all of the following requirements. How do you file a tax extension for free The trustee or custodian must be a bank, a federally insured credit union, a savings and loan association, or an entity approved by the IRS to act as trustee or custodian. How do you file a tax extension for free The trustee or custodian generally cannot accept contributions of more than the deductible amount for the year. How do you file a tax extension for free However, rollover contributions and employer contributions to a simplified employee pension (SEP) can be more than this amount. How do you file a tax extension for free Contributions, except for rollover contributions, must be in cash. How do you file a tax extension for free See Rollovers , later. How do you file a tax extension for free You must have a nonforfeitable right to the amount at all times. How do you file a tax extension for free Money in your account cannot be used to buy a life insurance policy. How do you file a tax extension for free Assets in your account cannot be combined with other property, except in a common trust fund or common investment fund. How do you file a tax extension for free You must start receiving distributions by April 1 of the year following the year in which you reach age 70½. How do you file a tax extension for free See When Must You Withdraw Assets? (Required Minimum Distributions) , later. How do you file a tax extension for free Individual Retirement Annuity You can open an individual retirement annuity by purchasing an annuity contract or an endowment contract from a life insurance company. How do you file a tax extension for free An individual retirement annuity must be issued in your name as the owner, and either you or your beneficiaries who survive you are the only ones who can receive the benefits or payments. How do you file a tax extension for free An individual retirement annuity must meet all the following requirements. How do you file a tax extension for free Your entire interest in the contract must be nonforfeitable. How do you file a tax extension for free The contract must provide that you cannot transfer any portion of it to any person other than the issuer. How do you file a tax extension for free There must be flexible premiums so that if your compensation changes, your payment can also change. How do you file a tax extension for free This provision applies to contracts issued after November 6, 1978. How do you file a tax extension for free The contract must provide that contributions cannot be more than the deductible amount for an IRA for the year, and that you must use any refunded premiums to pay for future premiums or to buy more benefits before the end of the calendar year after the year in which you receive the refund. How do you file a tax extension for free Distributions must begin by April 1 of the year following the year in which you reach age 70½. How do you file a tax extension for free See When Must You Withdraw Assets? (Required Minimum Distributions) , later. How do you file a tax extension for free Individual Retirement Bonds The sale of individual retirement bonds issued by the federal government was suspended after April 30, 1982. How do you file a tax extension for free The bonds have the following features. How do you file a tax extension for free They stop earning interest when you reach age 70½. How do you file a tax extension for free If you die, interest will stop 5 years after your death, or on the date you would have reached age 70½, whichever is earlier. How do you file a tax extension for free You cannot transfer the bonds. How do you file a tax extension for free If you cash (redeem) the bonds before the year in which you reach age 59½, you may be subject to a 10% additional tax. How do you file a tax extension for free See Age 59½ Rule under Early Distributions, later. How do you file a tax extension for free You can roll over redemption proceeds into IRAs. How do you file a tax extension for free Simplified Employee Pension (SEP) A simplified employee pension (SEP) is a written arrangement that allows your employer to make deductible contributions to a traditional IRA (a SEP IRA) set up for you to receive such contributions. How do you file a tax extension for free Generally, distributions from SEP IRAs are subject to the withdrawal and tax rules that apply to traditional IRAs. How do you file a tax extension for free See Publication 560 for more information about SEPs. How do you file a tax extension for free Employer and Employee Association Trust Accounts Your employer or your labor union or other employee association can set up a trust to provide individual retirement accounts for employees or members. How do you file a tax extension for free The requirements for individual retirement accounts apply to these traditional IRAs. How do you file a tax extension for free Required Disclosures The trustee or issuer (sometimes called the sponsor) of your traditional IRA generally must give you a disclosure statement at least 7 days before you open your IRA. How do you file a tax extension for free However, the sponsor does not have to give you the statement until the date you open (or purchase, if earlier) your IRA, provided you are given at least 7 days from that date to revoke the IRA. How do you file a tax extension for free The disclosure statement must explain certain items in plain language. How do you file a tax extension for free For example, the statement should explain when and how you can revoke the IRA, and include the name, address, and telephone number of the person to receive the notice of cancellation. How do you file a tax extension for free This explanation must appear at the beginning of the disclosure statement. How do you file a tax extension for free If you revoke your IRA within the revocation period, the sponsor must return to you the entire amount you paid. How do you file a tax extension for free The sponsor must report on the appropriate IRS forms both your contribution to the IRA (unless it was made by a trustee-to-trustee transfer) and the amount returned to you. How do you file a tax extension for free These requirements apply to all sponsors. How do you file a tax extension for free How Much Can Be Contributed? There are limits and other rules that affect the amount that can be contributed to a traditional IRA. How do you file a tax extension for free These limits and rules are explained below. How do you file a tax extension for free Community property laws. How do you file a tax extension for free   Except as discussed later under Kay Bailey Hutchison Spousal IRA Limit , each spouse figures his or her limit separately, using his or her own compensation. How do you file a tax extension for free This is the rule even in states with community property laws. How do you file a tax extension for free Brokers' commissions. How do you file a tax extension for free   Brokers' commissions paid in connection with your traditional IRA are subject to the contribution limit. How do you file a tax extension for free For information about whether you can deduct brokers' commissions, see Brokers' commissions , later, under How Much Can You Deduct. How do you file a tax extension for free Trustees' fees. How do you file a tax extension for free   Trustees' administrative fees are not subject to the contribution limit. How do you file a tax extension for free For information about whether you can deduct trustees' fees, see Trustees' fees , later, under How Much Can You Deduct. How do you file a tax extension for free Qualified reservist repayments. How do you file a tax extension for free   If you were a member of a reserve component and you were ordered or called to active duty after September 11, 2001, you may be able to contribute (repay) to an IRA amounts equal to any qualified reservist distributions (defined later under Early Distributions) you received. How do you file a tax extension for free You can make these repayment contributions even if they would cause your total contributions to the IRA to be more than the general limit on contributions. How do you file a tax extension for free To be eligible to make these repayment contributions, you must have received a qualified reservist distribution from an IRA or from a section 401(k) or 403(b) plan or a similar arrangement. How do you file a tax extension for free Limit. How do you file a tax extension for free   Your qualified reservist repayments cannot be more than your qualified reservist distributions, explained under Early Distributions , later. How do you file a tax extension for free When repayment contributions can be made. How do you file a tax extension for free   You cannot make these repayment contributions later than the date that is 2 years after your active duty period ends. How do you file a tax extension for free No deduction. How do you file a tax extension for free   You cannot deduct qualified reservist repayments. How do you file a tax extension for free Reserve component. How do you file a tax extension for free   The term “reserve component” means the: Army National Guard of the United States, Army Reserve, Naval Reserve, Marine Corps Reserve, Air National Guard of the United States, Air Force Reserve, Coast Guard Reserve, or Reserve Corps of the Public Health Service. How do you file a tax extension for free Figuring your IRA deduction. How do you file a tax extension for free   The repayment of qualified reservist distributions does not affect the amount you can deduct as an IRA contribution. How do you file a tax extension for free Reporting the repayment. How do you file a tax extension for free   If you repay a qualified reservist distribution, include the amount of the repayment with nondeductible contributions on line 1 of Form 8606. How do you file a tax extension for free Example. How do you file a tax extension for free   In 2013, your IRA contribution limit is $5,500. How do you file a tax extension for free However, because of your filing status and AGI, the limit on the amount you can deduct is $3,500. How do you file a tax extension for free You can make a nondeductible contribution of $2,000 ($5,500 - $3,500). How do you file a tax extension for free In an earlier year you received a $3,000 qualified reservist distribution, which you would like to repay this year. How do you file a tax extension for free   For 2013, you can contribute a total of $8,500 to your IRA. How do you file a tax extension for free This is made up of the maximum deductible contribution of $3,500; a nondeductible contribution of $2,000; and a $3,000 qualified reservist repayment. How do you file a tax extension for free You contribute the maximum allowable for the year. How do you file a tax extension for free Since you are making a nondeductible contribution ($2,000) and a qualified reservist repayment ($3,000), you must file Form 8606 with your return and include $5,000 ($2,000 + $3,000) on line 1 of Form 8606. How do you file a tax extension for free The qualified reservist repayment is not deductible. How do you file a tax extension for free Contributions on your behalf to a traditional IRA reduce your limit for contributions to a Roth IRA. How do you file a tax extension for free See chapter 2 for information about Roth IRAs. How do you file a tax extension for free General Limit For 2013, the most that can be contributed to your traditional IRA generally is the smaller of the following amounts: $5,500 ($6,500 if you are age 50 or older), or Your taxable compensation (defined earlier) for the year. How do you file a tax extension for free Note. How do you file a tax extension for free This limit is reduced by any contributions to a section 501(c)(18) plan (generally, a pension plan created before June 25, 1959, that is funded entirely by employee contributions). How do you file a tax extension for free This is the most that can be contributed regardless of whether the contributions are to one or more traditional IRAs or whether all or part of the contributions are nondeductible. How do you file a tax extension for free (See Nondeductible Contributions , later. How do you file a tax extension for free ) Qualified reservist repayments do not affect this limit. How do you file a tax extension for free Examples. How do you file a tax extension for free George, who is 34 years old and single, earns $24,000 in 2013. How do you file a tax extension for free His IRA contributions for 2013 are limited to $5,500. How do you file a tax extension for free Danny, an unmarried college student working part time, earns $3,500 in 2013. How do you file a tax extension for free His IRA contributions for 2013 are limited to $3,500, the amount of his compensation. How do you file a tax extension for free More than one IRA. How do you file a tax extension for free   If you have more than one IRA, the limit applies to the total contributions made on your behalf to all your traditional IRAs for the year. How do you file a tax extension for free Annuity or endowment contracts. How do you file a tax extension for free   If you invest in an annuity or endowment contract under an individual retirement annuity, no more than $5,500 ($6,500 if you are age 50 or older) can be contributed toward its cost for the tax year, including the cost of life insurance coverage. How do you file a tax extension for free If more than this amount is contributed, the annuity or endowment contract is disqualified. How do you file a tax extension for free Kay Bailey Hutchison Spousal IRA Limit For 2013, if you file a joint return and your taxable compensation is less than that of your spouse, the most that can be contributed for the year to your IRA is the smaller of the following two amounts: $5,500 ($6,500 if you are age 50 or older), or The total compensation includible in the gross income of both you and your spouse for the year, reduced by the following two amounts. How do you file a tax extension for free Your spouse's IRA contribution for the year to a traditional IRA. How do you file a tax extension for free Any contributions for the year to a Roth IRA on behalf of your spouse. How do you file a tax extension for free This means that the total combined contributions that can be made for the year to your IRA and your spouse's IRA can be as much as $11,000 ($12,000 if only one of you is age 50 or older or $13,000 if both of you are age 50 or older). How do you file a tax extension for free Note. How do you file a tax extension for free This traditional IRA limit is reduced by any contributions to a section 501(c)(18) plan (generally, a pension plan created before June 25, 1959, that is funded entirely by employee contributions). How do you file a tax extension for free Example. How do you file a tax extension for free Kristin, a full-time student with no taxable compensation, marries Carl during the year. How do you file a tax extension for free Neither of them was age 50 by the end of 2013. How do you file a tax extension for free For the year, Carl has taxable compensation of $30,000. How do you file a tax extension for free He plans to contribute (and deduct) $5,500 to a traditional IRA. How do you file a tax extension for free If he and Kristin file a joint return, each can contribute $5,500 to a traditional IRA. How do you file a tax extension for free This is because Kristin, who has no compensation, can add Carl's compensation, reduced by the amount of his IRA contribution ($30,000 − $5,500 = $24,500), to her own compensation (-0-) to figure her maximum contribution to a traditional IRA. How do you file a tax extension for free In her case, $5,500 is her contribution limit, because $5,500 is less than $24,500 (her compensation for purposes of figuring her contribution limit). How do you file a tax extension for free Filing Status Generally, except as discussed earlier under Kay Bailey Hutchison Spousal IRA Limit , your filing status has no effect on the amount of allowable contributions to your traditional IRA. How do you file a tax extension for free However, if during the year either you or your spouse was covered by a retirement plan at work, your deduction may be reduced or eliminated, depending on your filing status and income. How do you file a tax extension for free See How Much Can You Deduct , later. How do you file a tax extension for free Example. How do you file a tax extension for free Tom and Darcy are married and both are 53. How do you file a tax extension for free They both work and each has a traditional IRA. How do you file a tax extension for free Tom earned $3,800 and Darcy earned $48,000 in 2013. How do you file a tax extension for free Because of the Kay Bailey Hutchison Spousal IRA limit rule, even though Tom earned less than $6,500, they can contribute up to $6,500 to his IRA for 2013 if they file a joint return. How do you file a tax extension for free They can contribute up to $6,500 to Darcy's IRA. How do you file a tax extension for free If they file separate returns, the amount that can be contributed to Tom's IRA is limited by his earned income, $3,800. How do you file a tax extension for free Less Than Maximum Contributions If contributions to your traditional IRA for a year were less than the limit, you cannot contribute more after the due date of your return for that year to make up the difference. How do you file a tax extension for free Example. How do you file a tax extension for free Rafael, who is 40, earns $30,000 in 2013. How do you file a tax extension for free Although he can contribute up to $5,500 for 2013, he contributes only $3,000. How do you file a tax extension for free After April 15, 2014, Rafael cannot make up the difference between his actual contributions for 2013 ($3,000) and his 2013 limit ($5,500). How do you file a tax extension for free He cannot contribute $2,500 more than the limit for any later year. How do you file a tax extension for free More Than Maximum Contributions If contributions to your IRA for a year were more than the limit, you can apply the excess contribution in one year to a later year if the contributions for that later year are less than the maximum allowed for that year. How do you file a tax extension for free However, a penalty or additional tax may apply. How do you file a tax extension for free See Excess Contributions , later, under What Acts Result in Penalties or Additional Taxes. How do you file a tax extension for free When Can Contributions Be Made? As soon as you open your traditional IRA, contributions can be made to it through your chosen sponsor (trustee or other administrator). How do you file a tax extension for free Contributions must be in the form of money (cash, check, or money order). How do you file a tax extension for free Property cannot be contributed. How do you file a tax extension for free Although property cannot be contributed, your IRA may invest in certain property. How do you file a tax extension for free For example, your IRA may purchase shares of stock. How do you file a tax extension for free For other restrictions on the use of funds in your IRA, see Prohibited Transactions , later in this chapter. How do you file a tax extension for free You may be able to transfer or roll over certain property from one retirement plan to another. How do you file a tax extension for free See the discussion of rollovers and other transfers later in this chapter under Can You Move Retirement Plan Assets . How do you file a tax extension for free You can make a contribution to your IRA by having your income tax refund (or a portion of your refund), if any, paid directly to your traditional IRA, Roth IRA, or SEP IRA. How do you file a tax extension for free For details, see the instructions for your income tax return or Form 8888, Allocation of Refund (Including Savings Bond Purchases). How do you file a tax extension for free Contributions can be made to your traditional IRA for each year that you receive compensation and have not reached age 70½. How do you file a tax extension for free For any year in which you do not work, contributions cannot be made to your IRA unless you receive alimony, nontaxable combat pay, military differential pay, or file a joint return with a spouse who has compensation. How do you file a tax extension for free See Who Can Open a Traditional IRA , earlier. How do you file a tax extension for free Even if contributions cannot be made for the current year, the amounts contributed for years in which you did qualify can remain in your IRA. How do you file a tax extension for free Contributions can resume for any years that you qualify. How do you file a tax extension for free Contributions must be made by due date. How do you file a tax extension for free   Contributions can be made to your traditional IRA for a year at any time during the year or by the due date for filing your return for that year, not including extensions. How do you file a tax extension for free For most people, this means that contributions for 2013 must be made by April 15, 2014, and contributions for 2014 must be made by April 15, 2015. How do you file a tax extension for free Age 70½ rule. How do you file a tax extension for free   Contributions cannot be made to your traditional IRA for the year in which you reach age 70½ or for any later year. How do you file a tax extension for free   You attain age 70½ on the date that is 6 calendar months after the 70th anniversary of your birth. How do you file a tax extension for free If you were born on or before June 30, 1943, you cannot contribute for 2013 or any later year. How do you file a tax extension for free Designating year for which contribution is made. How do you file a tax extension for free   If an amount is contributed to your traditional IRA between January 1 and April 15, you should tell the sponsor which year (the current year or the previous year) the contribution is for. How do you file a tax extension for free If you do not tell the sponsor which year it is for, the sponsor can assume, and report to the IRS, that the contribution is for the current year (the year the sponsor received it). How do you file a tax extension for free Filing before a contribution is made. How do you file a tax extension for free    You can file your return claiming a traditional IRA contribution before the contribution is actually made. How do you file a tax extension for free Generally, the contribution must be made by the due date of your return, not including extensions. How do you file a tax extension for free Contributions not required. How do you file a tax extension for free   You do not have to contribute to your traditional IRA for every tax year, even if you can. How do you file a tax extension for free How Much Can You Deduct? Generally, you can deduct the lesser of: The contributions to your traditional IRA for the year, or The general limit (or the Kay Bailey Hutchison Spousal IRA limit, if applicable) explained earlier under How Much Can Be Contributed . How do you file a tax extension for free However, if you or your spouse was covered by an employer retirement plan, you may not be able to deduct this amount. How do you file a tax extension for free See Limit if Covered by Employer Plan , later. How do you file a tax extension for free You may be able to claim a credit for contributions to your traditional IRA. How do you file a tax extension for free For more information, see chapter 4. How do you file a tax extension for free Trustees' fees. How do you file a tax extension for free   Trustees' administrative fees that are billed separately and paid in connection with your traditional IRA are not deductible as IRA contributions. How do you file a tax extension for free However, they may be deductible as a miscellaneous itemized deduction on Schedule A (Form 1040). How do you file a tax extension for free For information about miscellaneous itemized deductions, see Publication 529, Miscellaneous Deductions. How do you file a tax extension for free Brokers' commissions. How do you file a tax extension for free   These commissions are part of your IRA contribution and, as such, are deductible subject to the limits. How do you file a tax extension for free Full deduction. How do you file a tax extension for free   If neither you nor your spouse was covered for any part of the year by an employer retirement plan, you can take a deduction for total contributions to one or more of your traditional IRAs of up to the lesser of: $5,500 ($6,500 if you are age 50 or older), or 100% of your compensation. How do you file a tax extension for free   This limit is reduced by any contributions made to a 501(c)(18) plan on your behalf. How do you file a tax extension for free Kay Bailey Hutchison Spousal IRA. How do you file a tax extension for free   In the case of a married couple with unequal compensation who file a joint return, the deduction for contributions to the traditional IRA of the spouse with less compensation is limited to the lesser of: $5,500 ($6,500 if the spouse with the lower compensation is age 50 or older), or The total compensation includible in the gross income of both spouses for the year reduced by the following three amounts. How do you file a tax extension for free The IRA deduction for the year of the spouse with the greater compensation. How do you file a tax extension for free Any designated nondeductible contribution for the year made on behalf of the spouse with the greater compensation. How do you file a tax extension for free Any contributions for the year to a Roth IRA on behalf of the spouse with the greater compensation. How do you file a tax extension for free   This limit is reduced by any contributions to a section 501(c)(18) plan on behalf of the spouse with the lesser compensation. How do you file a tax extension for free Note. How do you file a tax extension for free If you were divorced or legally separated (and did not remarry) before the end of the year, you cannot deduct any contributions to your spouse's IRA. How do you file a tax extension for free After a divorce or legal separation, you can deduct only the contributions to your own IRA. How do you file a tax extension for free Your deductions are subject to the rules for single individuals. How do you file a tax extension for free Covered by an employer retirement plan. How do you file a tax extension for free   If you or your spouse was covered by an employer retirement plan at any time during the year for which contributions were made, your deduction may be further limited. How do you file a tax extension for free This is discussed later under Limit if Covered by Employer Plan . How do you file a tax extension for free Limits on the amount you can deduct do not affect the amount that can be contributed. How do you file a tax extension for free Are You Covered by an Employer Plan? The Form W-2 you receive from your employer has a box used to indicate whether you were covered for the year. How do you file a tax extension for free The “Retirement Plan” box should be checked if you were covered. How do you file a tax extension for free Reservists and volunteer firefighters should also see Situations in Which You Are Not Covered , later. How do you file a tax extension for free If you are not certain whether you were covered by your employer's retirement plan, you should ask your employer. How do you file a tax extension for free Federal judges. How do you file a tax extension for free   For purposes of the IRA deduction, federal judges are covered by an employer plan. How do you file a tax extension for free For Which Year(s) Are You Covered? Special rules apply to determine the tax years for which you are covered by an employer plan. How do you file a tax extension for free These rules differ depending on whether the plan is a defined contribution plan or a defined benefit plan. How do you file a tax extension for free Tax year. How do you file a tax extension for free   Your tax year is the annual accounting period you use to keep records and report income and expenses on your income tax return. How do you file a tax extension for free For almost all people, the tax year is the calendar year. How do you file a tax extension for free Defined contribution plan. How do you file a tax extension for free   Generally, you are covered by a defined contribution plan for a tax year if amounts are contributed or allocated to your account for the plan year that ends with or within that tax year. How do you file a tax extension for free However, also see Situations in Which You Are Not Covered , later. How do you file a tax extension for free   A defined contribution plan is a plan that provides for a separate account for each person covered by the plan. How do you file a tax extension for free In a defined contribution plan, the amount to be contributed to each participant's account is spelled out in the plan. How do you file a tax extension for free The level of benefits actually provided to a participant depends on the total amount contributed to that participant's account and any earnings and losses on those contributions. How do you file a tax extension for free Types of defined contribution plans include profit-sharing plans, stock bonus plans, and money purchase pension plans. How do you file a tax extension for free Example. How do you file a tax extension for free Company A has a money purchase pension plan. How do you file a tax extension for free Its plan year is from July 1 to June 30. How do you file a tax extension for free The plan provides that contributions must be allocated as of June 30. How do you file a tax extension for free Bob, an employee, leaves Company A on December 31, 2012. How do you file a tax extension for free The contribution for the plan year ending on June 30, 2013, is made February 15, 2014. How do you file a tax extension for free Because an amount is contributed to Bob's account for the plan year, Bob is covered by the plan for his 2013 tax year. How do you file a tax extension for free   A special rule applies to certain plans in which it is not possible to determine if an amount will be contributed to your account for a given plan year. How do you file a tax extension for free If, for a plan year, no amounts have been allocated to your account that are attributable to employer contributions, employee contributions, or forfeitures, by the last day of the plan year, and contributions are discretionary for the plan year, you are not covered for the tax year in which the plan year ends. How do you file a tax extension for free If, after the plan year ends, the employer makes a contribution for that plan year, you are covered for the tax year in which the contribution is made. How do you file a tax extension for free Example. How do you file a tax extension for free Mickey was covered by a profit-sharing plan and left the company on December 31, 2012. How do you file a tax extension for free The plan year runs from July 1 to June 30. How do you file a tax extension for free Under the terms of the plan, employer contributions do not have to be made, but if they are made, they are contributed to the plan before the due date for filing the company's tax return. How do you file a tax extension for free Such contributions are allocated as of the last day of the plan year, and allocations are made to the accounts of individuals who have any service during the plan year. How do you file a tax extension for free As of June 30, 2013, no contributions were made that were allocated to the June 30, 2013, plan year, and no forfeitures had been allocated within the plan year. How do you file a tax extension for free In addition, as of that date, the company was not obligated to make a contribution for such plan year and it was impossible to determine whether or not a contribution would be made for the plan year. How do you file a tax extension for free On December 31, 2013, the company decided to contribute to the plan for the plan year ending June 30, 2013. How do you file a tax extension for free That contribution was made on February 15, 2014. How do you file a tax extension for free Mickey is an active participant in the plan for his 2014 tax year but not for his 2013 tax year. How do you file a tax extension for free No vested interest. How do you file a tax extension for free   If an amount is allocated to your account for a plan year, you are covered by that plan even if you have no vested interest in (legal right to) the account. How do you file a tax extension for free Defined benefit plan. How do you file a tax extension for free   If you are eligible to participate in your employer's defined benefit plan for the plan year that ends within your tax year, you are covered by the plan. How do you file a tax extension for free This rule applies even if you: Declined to participate in the plan, Did not make a required contribution, or Did not perform the minimum service required to accrue a benefit for the year. How do you file a tax extension for free   A defined benefit plan is any plan that is not a defined contribution plan. How do you file a tax extension for free In a defined benefit plan, the level of benefits to be provided to each participant is spelled out in the plan. How do you file a tax extension for free The plan administrator figures the amount needed to provide those benefits and those amounts are contributed to the plan. How do you file a tax extension for free Defined benefit plans include pension plans and annuity plans. How do you file a tax extension for free Example. How do you file a tax extension for free Nick, an employee of Company B, is eligible to participate in Company B's defined benefit plan, which has a July 1 to June 30 plan year. How do you file a tax extension for free Nick leaves Company B on December 31, 2012. How do you file a tax extension for free Because Nick is eligible to participate in the plan for its year ending June 30, 2013, he is covered by the plan for his 2013 tax year. How do you file a tax extension for free No vested interest. How do you file a tax extension for free   If you accrue a benefit for a plan year, you are covered by that plan even if you have no vested interest in (legal right to) the accrual. How do you file a tax extension for free Situations in Which You Are Not Covered Unless you are covered by another employer plan, you are not covered by an employer plan if you are in one of the situations described below. How do you file a tax extension for free Social security or railroad retirement. How do you file a tax extension for free   Coverage under social security or railroad retirement is not coverage under an employer retirement plan. How do you file a tax extension for free Benefits from previous employer's plan. How do you file a tax extension for free   If you receive retirement benefits from a previous employer's plan, you are not covered by that plan. How do you file a tax extension for free Reservists. How do you file a tax extension for free   If the only reason you participate in a plan is because you are a member of a reserve unit of the Armed Forces, you may not be covered by the plan. How do you file a tax extension for free You are not covered by the plan if both of the following conditions are met. How do you file a tax extension for free The plan you participate in is established for its employees by: The United States, A state or political subdivision of a state, or An instrumentality of either (a) or (b) above. How do you file a tax extension for free You did not serve more than 90 days on active duty during the year (not counting duty for training). How do you file a tax extension for free Volunteer firefighters. How do you file a tax extension for free   If the only reason you participate in a plan is because you are a volunteer firefighter, you may not be covered by the plan. How do you file a tax extension for free You are not covered by the plan if both of the following conditions are met. How do you file a tax extension for free The plan you participate in is established for its employees by: The United States, A state or political subdivision of a state, or An instrumentality of either (a) or (b) above. How do you file a tax extension for free Your accrued retirement benefits at the beginning of the year will not provide more than $1,800 per year at retirement. How do you file a tax extension for free Limit if Covered by Employer Plan As discussed earlier, the deduction you can take for contributions made to your traditional IRA depends on whether you or your spouse was covered for any part of the year by an employer retirement plan. How do you file a tax extension for free Your deduction is also affected by how much income you had and by your filing status. How do you file a tax extension for free Your deduction may also be affected by social security benefits you received. How do you file a tax extension for free Reduced or no deduction. How do you file a tax extension for free   If either you or your spouse was covered by an employer retirement plan, you may be entitled to only a partial (reduced) deduction or no deduction at all, depending on your income and your filing status. How do you file a tax extension for free   Your deduction begins to decrease (phase out) when your income rises above a certain amount and is eliminated altogether when it reaches a higher amount. How do you file a tax extension for free These amounts vary depending on your filing status. How do you file a tax extension for free   To determine if your deduction is subject to the phaseout, you must determine your modified adjusted gross income (AGI) and your filing status, as explained later under Deduction Phaseout . How do you file a tax extension for free Once you have determined your modified AGI and your filing status, you can use Table 1-2 or Table 1-3 to determine if the phaseout applies. How do you file a tax extension for free Social Security Recipients Instead of using Table 1-2 or Table 1-3 and Worksheet 1-2, Figuring Your Reduced IRA Deduction for 2013, later, complete the worksheets in Appendix B of this publication if, for the year, all of the following apply. How do you file a tax extension for free You received social security benefits. How do you file a tax extension for free You received taxable compensation. How do you file a tax extension for free Contributions were made to your traditional IRA. How do you file a tax extension for free You or your spouse was covered by an employer retirement plan. How do you file a tax extension for free Use the worksheets in Appendix B to figure your IRA deduction, your nondeductible contribution, and the taxable portion, if any, of your social security benefits. How do you file a tax extension for free Appendix B includes an example with filled-in worksheets to assist you. How do you file a tax extension for free Table 1-2. How do you file a tax extension for free Effect of Modified AGI1 on Deduction if You Are Covered by a Retirement Plan at Work If you are covered by a retirement plan at work, use this table to determine if your modified AGI affects the amount of your deduction. How do you file a tax extension for free IF your filing status is . How do you file a tax extension for free . How do you file a tax extension for free . How do you file a tax extension for free AND your modified adjusted gross income (modified AGI) is . How do you file a tax extension for free . How do you file a tax extension for free . How do you file a tax extension for free THEN you can take . How do you file a tax extension for free . How do you file a tax extension for free . How do you file a tax extension for free single or head of household $59,000 or less a full deduction. How do you file a tax extension for free more than $59,000 but less than $69,000 a partial deduction. How do you file a tax extension for free $69,000 or more no deduction. How do you file a tax extension for free married filing jointly or  qualifying widow(er) $95,000 or less a full deduction. How do you file a tax extension for free more than $95,000 but less than $115,000 a partial deduction. How do you file a tax extension for free $115,000 or more no deduction. How do you file a tax extension for free married filing separately2 less than $10,000 a partial deduction. How do you file a tax extension for free $10,000 or more no deduction. How do you file a tax extension for free 1 Modified AGI (adjusted gross income). How do you file a tax extension for free See Modified adjusted gross income (AGI) , later. How do you file a tax extension for free  2 If you did not live with your spouse at any time during the year, your filing status is considered Single for this purpose (therefore, your IRA deduction is determined under the “Single” filing status). How do you file a tax extension for free Table 1-3. How do you file a tax extension for free Effect of Modified AGI1 on Deduction if You Are NOT Covered by a Retirement Plan at Work If you are not covered by a retirement plan at work, use this table to determine if your modified AGI affects the amount of your deduction. How do you file a tax extension for free IF your filing status is . How do you file a tax extension for free . How do you file a tax extension for free . How do you file a tax extension for free AND your modified adjusted gross income (modified AGI) is . How do you file a tax extension for free . How do you file a tax extension for free . How do you file a tax extension for free THEN you can take . How do you file a tax extension for free . How do you file a tax extension for free . How do you file a tax extension for free single, head of household, or qualifying widow(er) any amount a full deduction. How do you file a tax extension for free married filing jointly or separately with a spouse who is not covered by a plan at work any amount a full deduction. How do you file a tax extension for free married filing jointly with a spouse who is covered by a plan at work $178,000 or less a full deduction. How do you file a tax extension for free more than $178,000 but less than $188,000 a partial deduction. How do you file a tax extension for free $188,000 or more no deduction. How do you file a tax extension for free married filing separately with a spouse who is covered by a plan at work2 less than $10,000 a partial deduction. How do you file a tax extension for free $10,000 or more no deduction. How do you file a tax extension for free 1 Modified AGI (adjusted gross income). How do you file a tax extension for free See Modified adjusted gross income (AGI) , later. How do you file a tax extension for free  2 You are entitled to the full deduction if you did not live with your spouse at any time during the year. How do you file a tax extension for free For 2014, if you are not covered by a retirement plan at work and you are married filing jointly with a spouse who is covered by a plan at work, your deduction is phased out if your modified AGI is more than $181,000 but less than $191,000. How do you file a tax extension for free If your AGI is $191,000 or more, you cannot take a deduction for a contribution to a traditional IRA. How do you file a tax extension for free Deduction Phaseout The amount of any reduction in the limit on your IRA deduction (phaseout) depends on whether you or your spouse was covered by an employer retirement plan. How do you file a tax extension for free Covered by a retirement plan. How do you file a tax extension for free   If you are covered by an employer retirement plan and you did not receive any social security retirement benefits, your IRA deduction may be reduced or eliminated depending on your filing status and modified AGI, as shown in Table 1-2. How do you file a tax extension for free For 2014, if you are covered by a retirement plan at work, your IRA deduction will not be reduced (phased out) unless your modified AGI is: More than $60,000 but less than $70,000 for a single individual (or head of household), More than $96,000 but less than $116,000 for a married couple filing a joint return (or a qualifying widow(er)), or Less than $10,000 for a married individual filing a separate return. How do you file a tax extension for free If your spouse is covered. How do you file a tax extension for free   If you are not covered by an employer retirement plan, but your spouse is, and you did not receive any social security benefits, your IRA deduction may be reduced or eliminated entirely depending on your filing status and modified AGI as shown in Table 1-3. How do you file a tax extension for free Filing status. How do you file a tax extension for free   Your filing status depends primarily on your marital status. How do you file a tax extension for free For this purpose, you need to know if your filing status is single or head of household, married filing jointly or qualifying widow(er), or married filing separately. How do you file a tax extension for free If you need more information on filing status, see Publication 501, Exemptions, Standard Deduction, and Filing Information. How do you file a tax extension for free Lived apart from spouse. How do you file a tax extension for free   If you did not live with your spouse at any time during the year and you file a separate return, your filing status, for this purpose, is single. How do you file a tax extension for free Modified adjusted gross income (AGI). How do you file a tax extension for free   You can use Worksheet 1-1 to figure your modified AGI. How do you file a tax extension for free If you made contributions to your IRA for 2013 and received a distribution from your IRA in 2013, see Both contributions for 2013 and distributions in 2013 , later. How do you file a tax extension for free    Do not assume that your modified AGI is the same as your compensation. How do you file a tax extension for free Your modified AGI may include income in addition to your compensation (discussed earlier) such as interest, dividends, and income from IRA distributions. How do you file a tax extension for free Form 1040. How do you file a tax extension for free   If you file Form 1040, refigure the amount on the page 1 “adjusted gross income” line without taking into account any of the following amounts. How do you file a tax extension for free IRA deduction. How do you file a tax extension for free Student loan interest deduction. How do you file a tax extension for free Tuition and fees deduction. How do you file a tax extension for free Domestic production activities deduction. How do you file a tax extension for free Foreign earned income exclusion. How do you file a tax extension for free Foreign housing exclusion or deduction. How do you file a tax extension for free Exclusion of qualified savings bond interest shown on Form 8815. How do you file a tax extension for free Exclusion of employer-provided adoption benefits shown on Form 8839. How do you file a tax extension for free This is your modified AGI. How do you file a tax extension for free Form 1040A. How do you file a tax extension for free   If you file Form 1040A, refigure the amount on the page 1 “adjusted gross income” line without taking into account any of the following amounts. How do you file a tax extension for free IRA deduction. How do you file a tax extension for free Student loan interest deduction. How do you file a tax extension for free Tuition and fees deduction. How do you file a tax extension for free Exclusion of qualified savings bond interest shown on Form 8815. How do you file a tax extension for free This is your modified AGI. How do you file a tax extension for free Form 1040NR. How do you file a tax extension for free   If you file Form 1040NR, refigure the amount on the page 1 “adjusted gross income” line without taking into account any of the following amounts. How do you file a tax extension for free IRA deduction. How do you file a tax extension for free Student loan interest deduction. How do you file a tax extension for free Domestic production activities deduction. How do you file a tax extension for free Exclusion of qualified savings bond interest shown on Form 8815. How do you file a tax extension for free Exclusion of employer-provided adoption benefits shown on Form 8839. How do you file a tax extension for free This is your modified AGI. How do you file a tax extension for free Income from IRA distributions. How do you file a tax extension for free   If you received distributions in 2013 from one or more traditional IRAs and your traditional IRAs include only deductible contributions, the distributions are fully taxable and are included in your modified AGI. How do you file a tax extension for free Both contributions for 2013 and distributions in 2013. How do you file a tax extension for free   If all three of the following apply, any IRA distributions you received in 2013 may be partly tax free and partly taxable. How do you file a tax extension for free You received distributions in 2013 from one or more traditional IRAs, You made contributions to a traditional IRA for 2013, and Some of those contributions may be nondeductible contributions. How do you file a tax extension for free (See Nondeductible Contributions and Worksheet 1-2, later. How do you file a tax extension for free ) If this is your situation, you must figure the taxable part of the traditional IRA distribution before you can figure your modified AGI. How do you file a tax extension for free To do this, you can use Worksheet 1-5, later. How do you file a tax extension for free   If at least one of the above does not apply, figure your modified AGI using Worksheet 1-1, later. How do you file a tax extension for free How To Figure Your Reduced IRA Deduction If you or your spouse is covered by an employer retirement plan and you did not receive any social security benefits, you can figure your reduced IRA deduction by using Worksheet 1-2. How do you file a tax extension for free Figuring Your Reduced IRA Deduction for 2013. How do you file a tax extension for free The Instructions for Form 1040, Form 1040A, and Form 1040NR include similar worksheets that you can use instead of the worksheet in this publication. How do you file a tax extension for free If you or your spouse is covered by an employer retirement plan, and you received any social security benefits, see Social Security Recipients , earlier. How do you file a tax extension for free Note. How do you file a tax extension for free If you were married and both you and your spouse contributed to IRAs, figure your deduction and your spouse's deduction separately. How do you file a tax extension for free Worksheet 1-1. How do you file a tax extension for free Figuring Your Modified AGI Use this worksheet to figure your modified AGI for traditional IRA purposes. How do you file a tax extension for free 1. How do you file a tax extension for free Enter your adjusted gross income (AGI) from Form 1040, line 38; Form 1040A, line 22; or Form 1040NR, line 37, figured without taking into account the amount from Form 1040, line 32; Form 1040A, line 17; or Form 1040NR, line 32 1. How do you file a tax extension for free   2. How do you file a tax extension for free Enter any student loan interest deduction from Form 1040, line 33; Form 1040A, line 18; or Form 1040NR, line 33 2. How do you file a tax extension for free   3. How do you file a tax extension for free Enter any tuition and fees deduction from Form 1040, line 34, or Form 1040A, line 19 3. How do you file a tax extension for free   4. How do you file a tax extension for free Enter any domestic production activities deduction from Form 1040, line 35, or Form 1040NR, line 34 4. How do you file a tax extension for free   5. How do you file a tax extension for free Enter any foreign earned income exclusion and/or housing exclusion from Form 2555, line 45, or Form 2555-EZ, line 18 5. How do you file a tax extension for free   6. How do you file a tax extension for free Enter any foreign housing deduction from Form 2555, line 50 6. How do you file a tax extension for free   7. How do you file a tax extension for free Enter any excludable savings bond interest from Form 8815, line 14 7. How do you file a tax extension for free   8. How do you file a tax extension for free Enter any excluded employer-provided adoption benefits from Form 8839, line 28 8. How do you file a tax extension for free   9. How do you file a tax extension for free Add lines 1 through 8. How do you file a tax extension for free This is your Modified AGI for traditional IRA purposes 9. How do you file a tax extension for free   Reporting Deductible Contributions If you file Form 1040, enter your IRA deduction on line 32 of that form. How do you file a tax extension for free If you file Form 1040A, enter your IRA deduction on line 17 of that form. How do you file a tax extension for free If you file Form 1040NR, enter your IRA deduction on line 32 of that form. How do you file a tax extension for free You cannot deduct IRA contributions on Form 1040EZ or Form 1040NR-EZ. How do you file a tax extension for free Self-employed. How do you file a tax extension for free   If you are self-employed (a sole proprietor or partner) and have a SIMPLE IRA, enter your deduction for allowable plan contributions on Form 1040, line 28. How do you file a tax extension for free If you file Form 1040NR, enter your deduction on line 28 of that form. How do you file a tax extension for free Nondeductible Contributions Although your deduction for IRA contributions may be reduced or eliminated, contributions can be made to your IRA of up to the general limit or, if it applies, the Kay Bailey Hutchison Spousal IRA limit. How do you file a tax extension for free The difference between your total permitted contributions and your IRA deduction, if any, is your nondeductible contribution. How do you file a tax extension for free Example. How do you file a tax extension for free Tony is 29 years old and single. How do you file a tax extension for free In 2013, he was covered by a retirement plan at work. How do you file a tax extension for free His salary is $62,000. How do you file a tax extension for free His modified AGI is $70,000. How do you file a tax extension for free Tony makes a $5,500 IRA contribution for 2013. How do you file a tax extension for free Because he was covered by a retirement plan and his modified AGI is above $69,000, he cannot deduct his $5,500 IRA contribution. How do you file a tax extension for free He must designate this contribution as a nondeductible contribution by reporting it on Form 8606. How do you file a tax extension for free Repayment of reservist distributions. How do you file a tax extension for free   Nondeductible contributions may include repayments of qualified reservist distributions. How do you file a tax extension for free For more information, see Qualified reservist repayments under How Much Can Be Contributed, earlier. How do you file a tax extension for free Form 8606. How do you file a tax extension for free   To designate contributions as nondeductible, you must file Form 8606. How do you file a tax extension for free (See the filled-in Forms 8606 in this chapter. How do you file a tax extension for free )   You do not have to designate a contribution as nondeductible until you file your tax return. How do you file a tax extension for free When you file, you can even designate otherwise deductible contributions as nondeductible contributions. How do you file a tax extension for free   You must file Form 8606 to report nondeductible contributions even if you do not have to file a tax return for the year. How do you file a tax extension for free    A Form 8606 is not used for the year that you make a rollover from a qualified retirement plan to a traditional IRA and the rollover includes nontaxable amounts. How do you file a tax extension for free In those situations, a Form 8606 is completed for the year you take a distribution from that IRA. How do you file a tax extension for free See Form 8606 under Distributions Fully or Partly Taxable, later. How do you file a tax extension for free Failure to report nondeductible contributions. How do you file a tax extension for free   If you do not report nondeductible contributions, all of the contributions to your traditional IRA will be treated like deductible contributions when withdrawn. How do you file a tax extension for free All distributions from your IRA will be taxed unless you can show, with satisfactory evidence, that nondeductible contributions were made. How do you file a tax extension for free Penalty for overstatement. How do you file a tax extension for free   If you overstate the amount of nondeductible contributions on your Form 8606 for any tax year, you must pay a penalty of $100 for each overstatement, unless it was due to reasonable cause. How do you file a tax extension for free Penalty for failure to file Form 8606. How do you file a tax extension for free   You will have to pay a $50 penalty if you do not file a required Form 8606, unless you can prove that the failure was due to reasonable cause. How do you file a tax extension for free Tax on earnings on nondeductible contributions. How do you file a tax extension for free   As long as contributions are within the contribution limits, none of the earnings or gains on contributions (deductible or nondeductible) will be taxed until they are distributed. How do you file a tax extension for free Cost basis. How do you file a tax extension for free   You will have a cost basis in your traditional IRA if you made any nondeductible contributions. How do you file a tax extension for free Your cost basis is the sum of the nondeductible contributions to your IRA minus any withdrawals or distributions of nondeductible contributions. How do you file a tax extension for free    Commonly, distributions from your traditional IRAs will include both taxable and nontaxable (cost basis) amounts. How do you file a tax extension for free See Are Distributions Taxable, later, for more information. How do you file a tax extension for free Recordkeeping. How do you file a tax extension for free There is a recordkeeping worksheet, Appendix A. How do you file a tax extension for free Summary Record of Traditional IRA(s) for 2013 , that you can use to keep a record of deductible and nondeductible IRA contributions. How do you file a tax extension for free Examples — Worksheet for Reduced IRA Deduction for 2013 The following examples illustrate the use of Worksheet 1-2, Figuring Your Reduced IRA Deduction for 2013. How do you file a tax extension for free Example 1. How do you file a tax extension for free For 2013, Tom and Betty file a joint return on Form 1040. How do you file a tax extension for free They are both 39 years old. How do you file a tax extension for free They are both employed and Tom is covered by his employer's retirement plan. How do you file a tax extension for free Tom's salary is $59,000 and Betty's is $32,555. How do you file a tax extension for free They each have a traditional IRA and their combined modified AGI, which includes $5,000 interest and dividend income, is $96,555. How do you file a tax extension for free Because their modified AGI is between $95,000 and $115,000 and Tom is covered by an employer plan, Tom is subject to the deduction phaseout discussed earlier under Limit if Covered by Employer Plan . How do you file a tax extension for free For 2013, Tom contributed $5,500 to his IRA and Betty contributed $5,500 to hers. How do you file a tax extension for free Even though they file a joint return, they must use separate worksheets to figure the IRA deduction for each of them. How do you file a tax extension for free Tom can take a deduction of only $5,080. How do you file a tax extension for free He can choose to treat the $5,080 as either deductible or nondeductible contributions. How do you file a tax extension for free He can either leave the $420 ($5,500 − $5,080) of nondeductible contributions in his IRA or withdraw them by April 15, 2014. How do you file a tax extension for free He decides to treat the $5,080 as deductible contributions and leave the $420 of nondeductible contributions in his IRA. How do you file a tax extension for free Using Worksheet 1-2, Figuring Your Reduced IRA Deduction for 2013, Tom figures his deductible and nondeductible amounts as shown on Worksheet 1-2. How do you file a tax extension for free Figuring Your Reduced IRA Deduction for 2013—Example 1 Illustrated. How do you file a tax extension for free Betty figures her IRA deduction as follows. How do you file a tax extension for free Betty can treat all or part of her contributions as either deductible or nondeductible. How do you file a tax extension for free This is because her $5,500 contribution for 2013 is not subject to the deduction phaseout discussed earlier under Limit if Covered by Employer Plan . How do you file a tax extension for free She does not need to use Worksheet 1-2, Figuring Your Reduced IRA Deduction for 2013, because their modified AGI is not within the phaseout range that applies. How do you file a tax extension for free Betty decides to treat her $5,500 IRA contributions as deductible. How do you file a tax extension for free The IRA deductions of $5,080 and $5,500 on the joint return for Tom and Betty total $10,580. How do you file a tax extension for free Example 2. How do you file a tax extension for free For 2013, Ed and Sue file a joint return on Form 1040. How do you file a tax extension for free They are both 39 years old. How do you file a tax extension for free Ed is covered by his employer's retirement plan. How do you file a tax extension for free Ed's salary is $45,000. How do you file a tax extension for free Sue had no compensation for the year and did not contribute to an IRA. How do you file a tax extension for free Sue is not covered by an employer plan. How do you file a tax extension for free Ed contributed $5,500 to his traditional IRA and $5,500 to a traditional IRA for Sue (a Kay Bailey Hutchison Spousal IRA). How do you file a tax extension for free Their combined modified AGI, which includes $2,000 interest and dividend income and a large capital gain from the sale of stock, is $180,555. How do you file a tax extension for free Because the combined modified AGI is $115,000 or more, Ed cannot deduct any of the contribution to his traditional IRA. How do you file a tax extension for free He can either leave the $5,500 of nondeductible contributions in his IRA or withdraw them by April 15, 2014. How do you file a tax extension for free Sue figures her IRA deduction as shown on Worksheet 1-2. How do you file a tax extension for free Figuring Your Reduced IRA Deduction for 2013—Example 2 Illustrated. How do you file a tax extension for free Worksheet 1-2. How do you file a tax extension for free Figuring Your Reduced IRA Deduction for 2013 (Use only if you or your spouse is covered by an employer plan and your modified AGI falls between the two amounts shown below for your coverage situation and filing status. How do you file a tax extension for free ) Note. How do you file a tax extension for free If you were married and both you and your spouse contributed to IRAs, figure your deduction and your spouse's deduction separately. How do you file a tax extension for free IF you . How do you file a tax extension for free . How do you file a tax extension for free . How do you file a tax extension for free AND your  filing status is . How do you file a tax extension for free . How do you file a tax extension for free . How do you file a tax extension for free AND your modified AGI is over . How do you file a tax extension for free . How do you file a tax extension for free . How do you file a tax extension for free THEN enter on  line 1 below . How do you file a tax extension for free . How do you file a tax extension for free . How do you file a tax extension for free       are covered by an employer plan single or head of household $59,000 $69,000     married filing jointly or qualifying widow(er) $95,000 $115,000     married filing separately $0 $10,000     are not covered by an employer plan, but your spouse is covered married filing jointly $178,000 $188,000     married filing separately $0 $10,000     1. How do you file a tax extension for free Enter applicable amount from table above 1. How do you file a tax extension for free   2. How do you file a tax extension for free Enter your modified AGI (that of both spouses, if married filing jointly) 2. How do you file a tax extension for free     Note. How do you file a tax extension for free If line 2 is equal to or more than the amount on line 1, stop here. How do you file a tax extension for free  Your IRA contributions are not deductible. How do you file a tax extension for free See Nondeductible Contributions , earlier. How do you file a tax extension for free     3. How do you file a tax extension for free Subtract line 2 from line 1. How do you file a tax extension for free If line 3 is $10,000 or more ($20,000 or more if married filing jointly or qualifying widow(er) and you are covered by an employer plan), stop here. How do you file a tax extension for free You can take a full IRA deduction for contributions of up to $5,500 ($6,500 if you are age 50 or older) or 100% of your (and if married filing jointly, your spouse's) compensation, whichever is less 3. How do you file a tax extension for free   4. How do you file a tax extension for free Multiply line 3 by the percentage below that applies to you. How do you file a tax extension for free If the result is not a multiple of $10, round it to the next highest multiple of $10. How do you file a tax extension for free (For example, $611. How do you file a tax extension for free 40 is rounded to $620. How do you file a tax extension for free ) However, if the result is less than $200, enter $200. How do you file a tax extension for free         Married filing jointly or qualifying widow(er) and you are covered by an employer plan, multiply line 3 by 27. How do you file a tax extension for free 5% (. How do you file a tax extension for free 275) (by 32. How do you file a tax extension for free 5% (. How do you file a tax extension for free 325) if you are age 50 or older). How do you file a tax extension for free All others, multiply line 3 by 55% (. How do you file a tax extension for free 55) (by 65% (. How do you file a tax extension for free 65) if you are age 50 or older). How do you file a tax extension for free 4. How do you file a tax extension for free   5. How do you file a tax extension for free Enter your compensation minus any deductions on Form 1040 or Form 1040NR, line 27 (deductible part of self-employment tax) and line 28 (self-employed SEP, SIMPLE, and qualified plans). How do you file a tax extension for free If you are filing a joint return and your compensation is less than your spouse's, include your spouse's compensation reduced by his or her traditional IRA and Roth IRA contributions for this year. How do you file a tax extension for free If you file Form 1040 or Form 1040NR, do not reduce your compensation by any losses from self-employment 5. How do you file a tax extension for free   6. How do you file a tax extension for free Enter contributions made, or to be made, to your IRA for 2013, but do not enter more than $5,500 ($6,500 if you are age 50 or older). How do you file a tax extension for free If contributions are more than $5,500 ($6,500 if you are age 50 or older), see Excess Contributions , later. How do you file a tax extension for free 6. How do you file a tax extension for free   7. How do you file a tax extension for free IRA deduction. How do you file a tax extension for free Compare lines 4, 5, and 6. How do you file a tax extension for free Enter the smallest amount (or a smaller amount if you choose) here and on the Form 1040, 1040A, or 1040NR line for your IRA, whichever applies. How do you file a tax extension for free If line 6 is more than line 7 and you want to make a nondeductible contribution, go to line 8 7. How do you file a tax extension for free   8. How do you file a tax extension for free Nondeductible contribution. How do you file a tax extension for free Subtract line 7 from line 5 or 6, whichever is smaller. How do you file a tax extension for free  Enter the result here and on line 1 of your Form 8606 8. How do you file a tax extension for free   Worksheet 1-2. How do you file a tax extension for free Figuring Your Reduced IRA Deduction for 2013—Example 1 Illustrated (Use only if you or your spouse is covered by an employer plan and your modified AGI falls between the two amounts shown below for your coverage situation and filing status. How do you file a tax extension for free ) Note. How do you file a tax extension for free If you were married and both you and your spouse contributed to IRAs, figure your deduction and your spouse's deduction separately. How do you file a tax extension for free IF you . How do you file a tax extension for free . How do you file a tax extension for free . How do you file a tax extension for free AND your  filing status is . How do you file a tax extension for free . How do you file a tax extension for free . How do you file a tax extension for free AND your modified AGI is over . How do you file a tax extension for free . How do you file a tax extension for free . How do you file a tax extension for free THEN enter on  line 1 below . How do you file a tax extension for free . How do you file a tax extension for free . How do you file a tax extension for free       are covered by an employer plan single or head of household $59,000 $69,000     married filing jointly or qualifying widow(er) $95,000 $115,000     married filing separately $0 $10,000     are not covered by an employer plan, but your spouse is covered married filing jointly $178,000 $188,000     married filing separately $0 $10,000     1. How do you file a tax extension for free Enter applicable amount from table above 1. How do you file a tax extension for free 115,000 2. How do you file a tax extension for free Enter your modified AGI (that of both spouses, if married filing jointly) 2. How do you file a tax extension for free 96,555   Note. How do you file a tax extension for free If line 2 is equal to or more than the amount on line 1, stop here. How do you file a tax extension for free  Your IRA contributions are not deductible. How do you file a tax extension for free See Nondeductible Contributions , earlier. How do you file a tax extension for free     3. How do you file a tax extension for free Subtract line 2 from line 1. How do you file a tax extension for free If line 3 is $10,000 or more ($20,000 or more if married filing jointly or qualifying widow(er) and you are covered by an employer plan), stop here. How do you file a tax extension for free You can take a full IRA deduction for contributions of up to $5,500 ($6,500 if you are age 50 or older) or 100% of your (and if married filing jointly, your spouse's) compensation, whichever is less 3. How do you file a tax extension for free 18,445 4. How do you file a tax extension for free Multiply line 3 by the percentage below that applies to you. How do you file a tax extension for free If the result is not a multiple of $10, round it to the next highest multiple of $10. How do you file a tax extension for free (For example, $611. How do you file a tax extension for free 40 is rounded to $620. How do you file a tax extension for free ) However, if the result is less than $200, enter $200. How do you file a tax extension for free         Married filing jointly or qualifying widow(er) and you are covered by an employer plan, multiply line 3 by 27. How do you file a tax extension for free 5% (. How do you file a tax extension for free 275) (by 32. How do you file a tax extension for free 5% (. How do you file a tax extension for free 325) if you are age 50 or older). How do you file a tax extension for free All others, multiply line 3 by 55% (. How do you file a tax extension for free 55) (by 65% (. How do you file a tax extension for free 65) if you are age 50 or older). How do you file a tax extension for free 4. How do you file a tax extension for free 5,080 5. How do you file a tax extension for free Enter your compensation minus any deductions on Form 1040 or Form 1040NR, line 27 (deductible part of self-employment tax) and line 28 (self-employed SEP, SIMPLE, and qualified plans). How do you file a tax extension for free If you are filing a joint return and your compensation is less than your spouse's, include your spouse's compensation reduced by his or her traditional IRA and Roth IRA contributions for this year. How do you file a tax extension for free If you file Form 1040 or Form 1040NR, do not reduce your compensation by any losses from self-employment 5. How do you file a tax extension for free 59,000 6. How do you file a tax extension for free Enter contributions made, or to be made, to your IRA for 2013, but do not enter more than $5,500 ($6,500 if you are age 50 or older). How do you file a tax extension for free If contributions are more than $5,500 ($6,500 if you are age 50 or older), see Excess Contributions , later. How do you file a tax extension for free 6. How do you file a tax extension for free 5,500 7. How do you file a tax extension for free IRA deduction. How do you file a tax extension for free Compare lines 4, 5, and 6. How do you file a tax extension for free Enter the smallest amount (or a smaller amount if you choose) here and on the Form 1040, 1040A, or 1040NR line for your IRA, whichever applies. How do you file a tax extension for free If line 6 is more than line 7 and you want to make a nondeductible contribution, go to line 8 7. How do you file a tax extension for free 5,080 8. How do you file a tax extension for free Nondeductible contribution. How do you file a tax extension for free Subtract line 7 from line 5 or 6, whichever is smaller. How do you file a tax extension for free  Enter the result here and on line 1 of your Form 8606 8. How do you file a tax extension for free 420 Worksheet 1-2. How do you file a tax extension for free Figuring Your Reduced IRA Deduction for 2013—Example 2 Illustrated (Use only if you or your spouse is covered by an employer plan and your modified AGI falls between the two amounts shown below for your coverage situation and filing status. How do you file a tax extension for free ) Note. How do you file a tax extension for free If you were married and both you and your spouse contributed to IRAs, figure your deduction and your spouse's deduction separately. How do you file a tax extension for free IF you . How do you file a tax extension for free . How do you file a tax extension for free . How do you file a tax extension for free AND your  filing status is . How do you file a tax extension for free . How do you file a tax extension for free . How do you file a tax extension for free AND your modified AGI is over . How do you file a tax extension for free . How do you file a tax extension for free . How do you file a tax extension for free THEN enter on  line 1 below . How do you file a tax extension for free . How do you file a tax extension for free . How do you file a tax extension for free       are covered by an employer plan single or head of household $59,000 $69,000     married filing jointly or qualifying widow(er) $95,000 $115,000     married filing separately $0 $10,000     are not covered by an employer plan, but your spouse is covered married filing jointly $178,000 $188,000     married filing separately $0 $10,000     1. How do you file a tax extension for free Enter applicable amount from table above 1. How do you file a tax extension for free 188,000 2. How do you file a tax extension for free Enter your modified AGI (that of both spouses, if married filing jointly) 2. How do you file a tax extension for free 180,555   Note. How do you file a tax extension for free If line 2 is equal to or more than the amount on line 1, stop here. How do you file a tax extension for free  Your IRA contributions are not deductible. How do you file a tax extension for free See Nondeductible Contributions , earlier. How do you file a tax extension for free     3. How do you file a tax extension for free Subtract line 2 from line 1. How do you file a tax extension for free If line 3 is $10,000 or more ($20,000 or more if married filing jointly or qualifying widow(er) and you are covered by an employer plan), stop here. How do you file a tax extension for free You can take a full IRA deduction for contributions of up to $5,500 ($6,500 if you are age 50 or older) or 100% of your (and if married filing jointly, your spouse's) compensation, whichever is less 3. How do you file a tax extension for free 7,445 4. How do you file a tax extension for free Multiply line 3 by the percentage below that applies to you. How do you file a tax extension for free If the result is not a multiple of $10, round it to the next highest multiple of $10. How do you file a tax extension for free (For example, $611. How do you file a tax extension for free 40 is rounded to $620. How do you file a tax extension for free ) However, if the result is less than $200, enter $200. How do you file a tax extension for free         Married filing jointly or qualifying widow(er) and you are covered by an employer plan, multiply line 3 by 27. How do you file a tax extension for free 5% (. How do you file a tax extension for free 275) (by 32. How do you file a tax extension for free 5% (. How do you file a tax extension for free 325) if you are age 50 or older). How do you file a tax extension for free All others, multiply line 3 by 55% (. How do you file a tax extension for free 55) (by 65% (. How do you file a tax extension for free 65) if you are age 50 or older). How do you file a tax extension for free 4. How do you file a tax extension for free 4,100 5. How do you file a tax extension for free Enter your compensation minus any deductions on Form 1040 or Form 1040NR, line 27 (deductible part of self-employment tax) and line 28 (self-employed SEP, SIMPLE, and qualified plans). How do you file a tax extension for free If you are filing a joint return and your compensation is less than your spouse's, include your spouse's compensation reduced by his or her traditional IRA and Roth IRA contributions for this year. How do you file a tax extension for free If you file Form 1040 or Form 1040NR, do not reduce your compensation by any losses from self-employment 5. How do you file a tax extension for free 39,500 6. How do you file a tax extension for free Enter contributions made, or to be made, to your IRA for 2013, but do not enter more than $5,500 ($6,500 if you are age 50 or older). How do you file a tax extension for free If contributions are more than $5,500 ($6,500 if you are age 50 or older), see Excess Contributions , later. How do you file a tax extension for free 6. How do you file a tax extension for free 5,500 7. How do you file a tax extension for free IRA deduction. How do you file a tax extension for free Compare lines 4, 5, and 6. How do you file a tax extension for free Enter the smallest amount (or a smaller amount if you choose) here and on the Form 1040, 1040A, or 1040NR line for your IRA, whichever applies. How do you file a tax extension for free If line 6 is more than line 7 and you want to make a nondeductible contribution, go to line 8 7. How do you file a tax extension for free 4,100 8. How do you file a tax extension for free Nondeductible contribution. How do you file a tax extension for free Subtract line 7 from line 5 or 6, whichever is smaller. How do you file a tax extension for free  Enter the result here and on line 1 of your Form 8606 8. How do you file a tax extension for free 1,400 What if You Inherit an IRA? If you inherit a traditional IRA, you are called a beneficiary. How do you file a tax extension for free A beneficiary can be any person or entity the owner chooses to receive the benefits of the IRA after he or she dies. How do you file a tax extension for free Beneficiaries of a traditional IRA must include in their gross income any taxable distributions they receive. How do you file a tax extension for free Inherited from spouse. How do you file a tax extension for free   If you inherit a traditional IRA from your spouse, you generally have the following three choices. How do you file a tax extension for free You can: Treat it as your own IRA by designating yourself as the account owner. How do you file a tax extension for free Treat it as your own by rolling it over into your IRA, or to the extent it is taxable, into a: Qualified employer plan, Qualified employee annuity plan (section 403(a) plan), Tax-sheltered annuity plan (s