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How To File 2011 Income Tax

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How To File 2011 Income Tax

How to file 2011 income tax 11. How to file 2011 income tax   Social Security and Equivalent Railroad Retirement Benefits Table of Contents Introduction Useful Items - You may want to see: Are Any of Your Benefits Taxable? How To Report Your BenefitsHow Much Is Taxable? Examples Deductions Related to Your BenefitsRepayments More Than Gross Benefits Introduction This chapter explains the federal income tax rules for social security benefits and equivalent tier 1 railroad retirement benefits. How to file 2011 income tax It explains the following topics. How to file 2011 income tax How to figure whether your benefits are taxable. How to file 2011 income tax How to use the social security benefits worksheet (with examples). How to file 2011 income tax How to report your taxable benefits. How to file 2011 income tax How to treat repayments that are more than the benefits you received during the year. How to file 2011 income tax Social security benefits include monthly retirement, survivor, and disability benefits. How to file 2011 income tax They do not include supplemental security income (SSI) payments, which are not taxable. How to file 2011 income tax Equivalent tier 1 railroad retirement benefits are the part of tier 1 benefits that a railroad employee or beneficiary would have been entitled to receive under the social security system. How to file 2011 income tax They are commonly called the social security equivalent benefit (SSEB) portion of tier 1 benefits. How to file 2011 income tax If you received these benefits during 2013, you should have received a Form SSA-1099, Social Security Benefit Statement, or Form RRB-1099, Payments by the Railroad Retirement Board. How to file 2011 income tax These forms show the amounts received and repaid, and taxes withheld for the year. How to file 2011 income tax You may receive more than one of these forms for the same year. How to file 2011 income tax You should add the amounts shown on all the Forms SSA-1099 and Forms RRB-1099 you receive for the year to determine the total amounts received and repaid, and taxes withheld for that year. How to file 2011 income tax See the Appendix at the end of Publication 915 for more information. How to file 2011 income tax Note. How to file 2011 income tax When the term “benefits” is used in this chapter, it applies to both social security benefits and the SSEB portion of tier 1 railroad retirement benefits. How to file 2011 income tax What is not covered in this chapter. How to file 2011 income tax   This chapter does not cover the tax rules for the following railroad retirement benefits. How to file 2011 income tax Non-social security equivalent benefit (NSSEB) portion of tier 1 benefits. How to file 2011 income tax Tier 2 benefits. How to file 2011 income tax Vested dual benefits. How to file 2011 income tax Supplemental annuity benefits. How to file 2011 income tax For information on these benefits, see Publication 575, Pension and Annuity Income. How to file 2011 income tax   This chapter does not cover the tax rules for social security benefits reported on Form SSA-1042S, Social Security Benefit Statement, or Form RRB-1042S, Statement for Nonresident Alien Recipients of: Payments by the Railroad Retirement Board. How to file 2011 income tax For information about these benefits, see Publication 519, U. How to file 2011 income tax S. How to file 2011 income tax Tax Guide for Aliens, and Publication 915, Social Security and Equivalent Railroad Retirement Benefits. How to file 2011 income tax   This chapter also does not cover the tax rules for foreign social security benefits. How to file 2011 income tax These benefits are taxable as annuities, unless they are exempt from U. How to file 2011 income tax S. How to file 2011 income tax tax or treated as a U. How to file 2011 income tax S. How to file 2011 income tax social security benefit under a tax treaty. How to file 2011 income tax Useful Items - You may want to see: Publication 505 Tax Withholding and Estimated Tax 575 Pension and Annuity Income 590 Individual Retirement Arrangements (IRAs) 915 Social Security and Equivalent Railroad Retirement Benefits Forms (and Instructions) 1040-ES Estimated Tax for Individuals SSA-1099 Social Security Benefit Statement RRB-1099 Payments by the Railroad Retirement Board W-4V Voluntary Withholding Request Are Any of Your Benefits Taxable? To find out whether any of your benefits may be taxable, compare the base amount for your filing status with the total of: One-half of your benefits, plus All your other income, including tax-exempt interest. How to file 2011 income tax When making this comparison, do not reduce your other income by any exclusions for: Interest from qualified U. How to file 2011 income tax S. How to file 2011 income tax savings bonds, Employer-provided adoption benefits, Foreign earned income or foreign housing, or Income earned by bona fide residents of American Samoa or Puerto Rico. How to file 2011 income tax Children's benefits. How to file 2011 income tax   The rules in this chapter apply to benefits received by children. How to file 2011 income tax See Who is taxed , later. How to file 2011 income tax Figuring total income. How to file 2011 income tax   To figure the total of one-half of your benefits plus your other income, use Worksheet 11-1 later in this discussion. How to file 2011 income tax If the total is more than your base amount, part of your benefits may be taxable. How to file 2011 income tax    If you are married and file a joint return for 2013, you and your spouse must combine your incomes and your benefits to figure whether any of your combined benefits are taxable. How to file 2011 income tax Even if your spouse did not receive any benefits, you must add your spouse's income to yours to figure whether any of your benefits are taxable. How to file 2011 income tax    If the only income you received during 2013 was your social security or the SSEB portion of tier 1 railroad retirement benefits, your benefits generally are not taxable and you probably do not have to file a return. How to file 2011 income tax If you have income in addition to your benefits, you may have to file a return even if none of your benefits are taxable. How to file 2011 income tax Base amount. How to file 2011 income tax   Your base amount is: $25,000 if you are single, head of household, or qualifying widow(er), $25,000 if you are married filing separately and lived apart from your spouse for all of 2013, $32,000 if you are married filing jointly, or $-0- if you are married filing separately and lived with your spouse at any time during 2013. How to file 2011 income tax Worksheet 11-1. How to file 2011 income tax   You can use Worksheet 11-1 to figure the amount of income to compare with your base amount. How to file 2011 income tax This is a quick way to check whether some of your benefits may be taxable. How to file 2011 income tax Worksheet 11-1. How to file 2011 income tax A Quick Way To Check if Your Benefits May Be Taxable A. How to file 2011 income tax Enter the amount from box 5 of all your Forms SSA-1099 and RRB-1099. How to file 2011 income tax Include the full amount of any lump-sum benefit payments received in 2013, for 2013 and earlier years. How to file 2011 income tax (If you received more than one form, combine the amounts from box 5 and enter the total. How to file 2011 income tax ) A. How to file 2011 income tax   Note. How to file 2011 income tax If the amount on line A is zero or less, stop here; none of your benefits are taxable this year. How to file 2011 income tax B. How to file 2011 income tax Enter one-half of the amount on line A B. How to file 2011 income tax   C. How to file 2011 income tax Enter your taxable pensions, wages, interest, dividends, and other taxable income C. How to file 2011 income tax   D. How to file 2011 income tax Enter any tax-exempt interest income (such as interest on municipal bonds) plus any exclusions from income (listed earlier) D. How to file 2011 income tax   E. How to file 2011 income tax Add lines B, C, and D E. How to file 2011 income tax   Note. How to file 2011 income tax Compare the amount on line E to your base amount for your filing status. How to file 2011 income tax If the amount on line E equals or is less than the base amount for your filing status, none of your benefits are taxable this year. How to file 2011 income tax If the amount on line E is more than your base amount, some of your benefits may be taxable. How to file 2011 income tax You need to complete Worksheet 1 in Publication 915 (or the Social Security Benefits Worksheet in your tax form instructions). How to file 2011 income tax If none of your benefits are taxable, but you otherwise must file a tax return, see Benefits not taxable , later, under How To Report Your Benefits. How to file 2011 income tax Example. How to file 2011 income tax You and your spouse (both over 65) are filing a joint return for 2013 and you both received social security benefits during the year. How to file 2011 income tax In January 2014, you received a Form SSA-1099 showing net benefits of $7,500 in box 5. How to file 2011 income tax Your spouse received a Form SSA-1099 showing net benefits of $3,500 in box 5. How to file 2011 income tax You also received a taxable pension of $22,800 and interest income of $500. How to file 2011 income tax You did not have any tax-exempt interest income. How to file 2011 income tax Your benefits are not taxable for 2013 because your income, as figured in Worksheet 11-1, is not more than your base amount ($32,000) for married filing jointly. How to file 2011 income tax Even though none of your benefits are taxable, you must file a return for 2013 because your taxable gross income ($23,300) exceeds the minimum filing requirement amount for your filing status. How to file 2011 income tax Filled-in Worksheet 11-1. How to file 2011 income tax A Quick Way To Check if Your Benefits May Be Taxable A. How to file 2011 income tax Enter the amount from box 5 of all your Forms SSA-1099 and RRB-1099. How to file 2011 income tax Include the full amount of any lump-sum benefit payments received in 2013, for 2013 and earlier years. How to file 2011 income tax (If you received more than one form, combine the amounts from box 5 and enter the total. How to file 2011 income tax ) A. How to file 2011 income tax $11,000 Note. How to file 2011 income tax If the amount on line A is zero or less, stop here; none of your benefits are taxable this year. How to file 2011 income tax B. How to file 2011 income tax Enter one-half of the amount on line A B. How to file 2011 income tax 5,500 C. How to file 2011 income tax Enter your taxable pensions, wages, interest, dividends, and other taxable income C. How to file 2011 income tax 23,300 D. How to file 2011 income tax Enter any tax-exempt interest income (such as interest on municipal bonds) plus any exclusions from income (listed earlier) D. How to file 2011 income tax -0- E. How to file 2011 income tax Add lines B, C, and D E. How to file 2011 income tax $28,800 Note. How to file 2011 income tax Compare the amount on line E to your base amount for your filing status. How to file 2011 income tax If the amount on line E equals or is less than the base amount for your filing status, none of your benefits are taxable this year. How to file 2011 income tax If the amount on line E is more than your base amount, some of your benefits may be taxable. How to file 2011 income tax You need to complete Worksheet 1 in Publication 915 (or the Social Security Benefits Worksheet in your tax form instructions). How to file 2011 income tax If none of your benefits are taxable, but you otherwise must file a tax return, see Benefits not taxable , later, under How To Report Your Benefits. How to file 2011 income tax Who is taxed. How to file 2011 income tax   Benefits are included in the taxable income (to the extent they are taxable) of the person who has the legal right to receive the benefits. How to file 2011 income tax For example, if you and your child receive benefits, but the check for your child is made out in your name, you must use only your part of the benefits to see whether any benefits are taxable to you. How to file 2011 income tax One-half of the part that belongs to your child must be added to your child's other income to see whether any of those benefits are taxable to your child. How to file 2011 income tax Repayment of benefits. How to file 2011 income tax   Any repayment of benefits you made during 2013 must be subtracted from the gross benefits you received in 2013. How to file 2011 income tax It does not matter whether the repayment was for a benefit you received in 2013 or in an earlier year. How to file 2011 income tax If you repaid more than the gross benefits you received in 2013, see Repayments More Than Gross Benefits , later. How to file 2011 income tax   Your gross benefits are shown in box 3 of Form SSA-1099 or RRB-1099. How to file 2011 income tax Your repayments are shown in box 4. How to file 2011 income tax The amount in box 5 shows your net benefits for 2013 (box 3 minus box 4). How to file 2011 income tax Use the amount in box 5 to figure whether any of your benefits are taxable. How to file 2011 income tax Tax withholding and estimated tax. How to file 2011 income tax   You can choose to have federal income tax withheld from your social security benefits and/or the SSEB portion of your tier 1 railroad retirement benefits. How to file 2011 income tax If you choose to do this, you must complete a Form W-4V. How to file 2011 income tax   If you do not choose to have income tax withheld, you may have to request additional withholding from other income or pay estimated tax during the year. How to file 2011 income tax For details, see Publication 505 or the instructions for Form 1040-ES. How to file 2011 income tax How To Report Your Benefits If part of your benefits are taxable, you must use Form 1040 or Form 1040A. How to file 2011 income tax You cannot use Form 1040EZ. How to file 2011 income tax Reporting on Form 1040. How to file 2011 income tax   Report your net benefits (the total amount from box 5 of all your Forms SSA-1099 and Forms RRB-1099) on line 20a and the taxable part on line 20b. How to file 2011 income tax If you are married filing separately and you lived apart from your spouse for all of 2013, also enter “D” to the right of the word “benefits” on line 20a. How to file 2011 income tax Reporting on Form 1040A. How to file 2011 income tax   Report your net benefits (the total amount from box 5 of all your Forms SSA-1099 and Forms RRB-1099) on line 14a and the taxable part on line 14b. How to file 2011 income tax If you are married filing separately and you lived apart from your spouse for all of 2013, also enter “D” to the right of the word “benefits” on line 14a. How to file 2011 income tax Benefits not taxable. How to file 2011 income tax   If you are filing Form 1040EZ, do not report any benefits on your tax return. How to file 2011 income tax If you are filing Form 1040 or Form 1040A, report your net benefits (the total amount from box 5 of all your Forms SSA-1099 and Forms RRB-1099) on Form 1040, line 20a, or Form 1040A, line 14a. How to file 2011 income tax Enter -0- on Form 1040, line 20b, or Form 1040A, line 14b. How to file 2011 income tax If you are married filing separately and you lived apart from your spouse for all of 2013, also enter “D” to the right of the word “benefits” on Form 1040, line 20a, or Form 1040A, line 14a. How to file 2011 income tax How Much Is Taxable? If part of your benefits are taxable, how much is taxable depends on the total amount of your benefits and other income. How to file 2011 income tax Generally, the higher that total amount, the greater the taxable part of your benefits. How to file 2011 income tax Maximum taxable part. How to file 2011 income tax   Generally, up to 50% of your benefits will be taxable. How to file 2011 income tax However, up to 85% of your benefits can be taxable if either of the following situations applies to you. How to file 2011 income tax The total of one-half of your benefits and all your other income is more than $34,000 ($44,000 if you are married filing jointly). How to file 2011 income tax You are married filing separately and lived with your spouse at any time during 2013. How to file 2011 income tax Which worksheet to use. How to file 2011 income tax   A worksheet you can use to figure your taxable benefits is in the instructions for your Form 1040 or Form 1040A. How to file 2011 income tax You can use either that worksheet or Worksheet 1 in Publication 915, unless any of the following situations applies to you. How to file 2011 income tax You contributed to a traditional individual retirement arrangement (IRA) and you or your spouse is covered by a retirement plan at work. How to file 2011 income tax In this situation, you must use the special worksheets in Appendix B of Publication 590 to figure both your IRA deduction and your taxable benefits. How to file 2011 income tax Situation (1) does not apply and you take an exclusion for interest from qualified U. How to file 2011 income tax S. How to file 2011 income tax savings bonds (Form 8815), for adoption benefits (Form 8839), for foreign earned income or housing (Form 2555 or Form 2555-EZ), or for income earned in American Samoa (Form 4563) or Puerto Rico by bona fide residents. How to file 2011 income tax In this situation, you must use Worksheet 1 in Publication 915 to figure your taxable benefits. How to file 2011 income tax You received a lump-sum payment for an earlier year. How to file 2011 income tax In this situation, also complete Worksheet 2 or 3 and Worksheet 4 in Publication 915. How to file 2011 income tax See Lump-sum election next. How to file 2011 income tax Lump-sum election. How to file 2011 income tax   You must include the taxable part of a lump-sum (retroactive) payment of benefits received in 2013 in your 2013 income, even if the payment includes benefits for an earlier year. How to file 2011 income tax    This type of lump-sum benefit payment should not be confused with the lump-sum death benefit that both the SSA and RRB pay to many of their beneficiaries. How to file 2011 income tax No part of the lump-sum death benefit is subject to tax. How to file 2011 income tax   Generally, you use your 2013 income to figure the taxable part of the total benefits received in 2013. How to file 2011 income tax However, you may be able to figure the taxable part of a lump-sum payment for an earlier year separately, using your income for the earlier year. How to file 2011 income tax You can elect this method if it lowers your taxable benefits. How to file 2011 income tax Making the election. How to file 2011 income tax   If you received a lump-sum benefit payment in 2013 that includes benefits for one or more earlier years, follow the instructions in Publication 915 under Lump-Sum Election to see whether making the election will lower your taxable benefits. How to file 2011 income tax That discussion also explains how to make the election. How to file 2011 income tax    Because the earlier year's taxable benefits are included in your 2013 income, no adjustment is made to the earlier year's return. How to file 2011 income tax Do not file an amended return for the earlier year. How to file 2011 income tax Examples The following are a few examples you can use as a guide to figure the taxable part of your benefits. How to file 2011 income tax Example 1. How to file 2011 income tax George White is single and files Form 1040 for 2013. How to file 2011 income tax He received the following income in 2013: Fully taxable pension $18,600 Wages from part-time job 9,400 Taxable interest income 990 Total $28,990 George also received social security benefits during 2013. How to file 2011 income tax The Form SSA-1099 he received in January 2014 shows $5,980 in box 5. How to file 2011 income tax To figure his taxable benefits, George completes the worksheet shown here. How to file 2011 income tax Filled-in Worksheet 1. How to file 2011 income tax Figuring Your Taxable Benefits 1. How to file 2011 income tax Enter the total amount from box 5 of ALL your Forms SSA-1099 and RRB-1099. How to file 2011 income tax Also enter this amount on Form 1040, line 20a, or Form 1040A, line 14a $5,980 2. How to file 2011 income tax Enter one-half of line 1 2,990 3. How to file 2011 income tax Combine the amounts from:     Form 1040: Lines 7, 8a, 9a, 10 through 14, 15b, 16b, 17 through 19, and 21. How to file 2011 income tax     Form 1040A: Lines 7, 8a, 9a, 10, 11b, 12b, and 13 28,990 4. How to file 2011 income tax Enter the amount, if any, from Form 1040 or 1040A, line 8b -0-       5. How to file 2011 income tax Enter the total of any exclusions/adjustments for: Adoption benefits (Form 8839, line 28), Foreign earned income or housing (Form 2555, lines 45 and 50, or Form 2555-EZ, line 18), and Certain income of bona fide residents of American Samoa (Form 4563, line 15) or Puerto Rico -0-       6. How to file 2011 income tax Combine lines 2, 3, 4, and 5 31,980 7. How to file 2011 income tax Form 1040 filers: Enter the amount from Form 1040, lines 23 through 32, and any write-in adjustments you entered on the dotted line next to line 36. How to file 2011 income tax     Form 1040A filers: Enter the amount from Form 1040A, lines 16 and 17 -0- 8. How to file 2011 income tax Is the amount on line 7 less than the amount on line 6?     No. How to file 2011 income tax None of your social security benefits are taxable. How to file 2011 income tax Enter -0- on Form 1040, line 20b, or Form 1040A, line 14b. How to file 2011 income tax   Yes. How to file 2011 income tax Subtract line 7 from line 6 31,980 9. How to file 2011 income tax If you are: Married filing jointly, enter $32,000 Single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013, enter $25,000 25,000   Note. How to file 2011 income tax If you are married filing separately and you lived with your spouse at any time in 2013, skip lines 9 through 16; multiply line 8 by 85% (. How to file 2011 income tax 85) and enter the result on line 17. How to file 2011 income tax Then go to line 18. How to file 2011 income tax   10. How to file 2011 income tax Is the amount on line 9 less than the amount on line 8?     No. How to file 2011 income tax None of your benefits are taxable. How to file 2011 income tax Enter -0- on Form 1040, line 20b, or on Form 1040A, line 14b. How to file 2011 income tax If you are married filing separately and you lived apart from your spouse for all of 2013, be sure you entered “D” to the right of the word “benefits” on Form 1040, line 20a, or on Form 1040A, line 14a. How to file 2011 income tax     Yes. How to file 2011 income tax Subtract line 9 from line 8 6,980 11. How to file 2011 income tax Enter $12,000 if married filing jointly; $9,000 if single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013 9,000 12. How to file 2011 income tax Subtract line 11 from line 10. How to file 2011 income tax If zero or less, enter -0- -0- 13. How to file 2011 income tax Enter the smaller of line 10 or line 11 6,980 14. How to file 2011 income tax Enter one-half of line 13 3,490 15. How to file 2011 income tax Enter the smaller of line 2 or line 14 2,990 16. How to file 2011 income tax Multiply line 12 by 85% (. How to file 2011 income tax 85). How to file 2011 income tax If line 12 is zero, enter -0- -0- 17. How to file 2011 income tax Add lines 15 and 16 2,990 18. How to file 2011 income tax Multiply line 1 by 85% (. How to file 2011 income tax 85) 5,083 19. How to file 2011 income tax Taxable benefits. How to file 2011 income tax Enter the smaller of line 17 or line 18. How to file 2011 income tax Also enter this amount on Form 1040, line 20b, or Form 1040A, line 14b $2,990 The amount on line 19 of George's worksheet shows that $2,990 of his social security benefits is taxable. How to file 2011 income tax On line 20a of his Form 1040, George enters his net benefits of $5,980. How to file 2011 income tax On line 20b, he enters his taxable benefits of $2,990. How to file 2011 income tax Example 2. How to file 2011 income tax Ray and Alice Hopkins file a joint return on Form 1040A for 2013. How to file 2011 income tax Ray is retired and received a fully taxable pension of $15,500. How to file 2011 income tax He also received social security benefits, and his Form SSA-1099 for 2013 shows net benefits of $5,600 in box 5. How to file 2011 income tax Alice worked during the year and had wages of $14,000. How to file 2011 income tax She made a deductible payment to her IRA account of $1,000. How to file 2011 income tax Ray and Alice have two savings accounts with a total of $250 in taxable interest income. How to file 2011 income tax They complete Worksheet 1, entering $29,750 ($15,500 + $14,000 + $250) on line 3. How to file 2011 income tax They find none of Ray's social security benefits are taxable. How to file 2011 income tax On Form 1040A, they enter $5,600 on line 14a and -0- on line 14b. How to file 2011 income tax Filled-in Worksheet 1. How to file 2011 income tax Figuring Your Taxable Benefits 1. How to file 2011 income tax Enter the total amount from box 5 of ALL your Forms SSA-1099 and RRB-1099. How to file 2011 income tax Also enter this amount on Form 1040, line 20a, or Form 1040A, line 14a $5,600 2. How to file 2011 income tax Enter one-half of line 1 2,800 3. How to file 2011 income tax Combine the amounts from:     Form 1040: Lines 7, 8a, 9a, 10 through 14, 15b, 16b, 17 through 19, and 21. How to file 2011 income tax     Form 1040A: Lines 7, 8a, 9a, 10, 11b, 12b, and 13 29,750 4. How to file 2011 income tax Enter the amount, if any, from Form 1040 or 1040A, line 8b -0-       5. How to file 2011 income tax Enter the total of any exclusions/adjustments for: Adoption benefits (Form 8839, line 28), Foreign earned income or housing (Form 2555, lines 45 and 50, or Form 2555-EZ, line 18), and Certain income of bona fide residents of American Samoa (Form 4563, line 15) or Puerto Rico -0-       6. How to file 2011 income tax Combine lines 2, 3, 4, and 5 32,550 7. How to file 2011 income tax Form 1040 filers: Enter the amount from Form 1040, lines 23 through 32, and any write-in adjustments you entered on the dotted line next to line 36. How to file 2011 income tax     Form 1040A filers: Enter the amount from Form 1040A, lines 16 and 17 1,000 8. How to file 2011 income tax Is the amount on line 7 less than the amount on line 6?     No. How to file 2011 income tax None of your social security benefits are taxable. How to file 2011 income tax Enter -0- on Form 1040, line 20b, or Form 1040A, line 14b. How to file 2011 income tax   Yes. How to file 2011 income tax Subtract line 7 from line 6 31,550 9. How to file 2011 income tax If you are: Married filing jointly, enter $32,000 Single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013, enter $25,000 32,000   Note. How to file 2011 income tax If you are married filing separately and you lived with your spouse at any time in 2013, skip lines 9 through 16; multiply line 8 by 85% (. How to file 2011 income tax 85) and enter the result on line 17. How to file 2011 income tax Then go to line 18. How to file 2011 income tax   10. How to file 2011 income tax Is the amount on line 9 less than the amount on line 8?     No. How to file 2011 income tax None of your benefits are taxable. How to file 2011 income tax Enter -0- on Form 1040, line 20b, or on Form 1040A, line 14b. How to file 2011 income tax If you are married filing separately and you lived apart from your spouse for all of 2013, be sure you entered “D” to the right of the word “benefits” on Form 1040, line 20a, or on Form 1040A, line 14a. How to file 2011 income tax     Yes. How to file 2011 income tax Subtract line 9 from line 8   11. How to file 2011 income tax Enter $12,000 if married filing jointly; $9,000 if single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013   12. How to file 2011 income tax Subtract line 11 from line 10. How to file 2011 income tax If zero or less, enter -0-   13. How to file 2011 income tax Enter the smaller of line 10 or line 11   14. How to file 2011 income tax Enter one-half of line 13   15. How to file 2011 income tax Enter the smaller of line 2 or line 14   16. How to file 2011 income tax Multiply line 12 by 85% (. How to file 2011 income tax 85). How to file 2011 income tax If line 12 is zero, enter -0-   17. How to file 2011 income tax Add lines 15 and 16   18. How to file 2011 income tax Multiply line 1 by 85% (. How to file 2011 income tax 85)   19. How to file 2011 income tax Taxable benefits. How to file 2011 income tax Enter the smaller of line 17 or line 18. How to file 2011 income tax Also enter this amount on Form 1040, line 20b, or Form 1040A, line 14b   Example 3. How to file 2011 income tax Joe and Betty Johnson file a joint return on Form 1040 for 2013. How to file 2011 income tax Joe is a retired railroad worker and in 2013 received the social security equivalent benefit (SSEB) portion of tier 1 railroad retirement benefits. How to file 2011 income tax Joe's Form RRB-1099 shows $10,000 in box 5. How to file 2011 income tax Betty is a retired government worker and receives a fully taxable pension of $38,000. How to file 2011 income tax They had $2,300 in taxable interest income plus interest of $200 on a qualified U. How to file 2011 income tax S. How to file 2011 income tax savings bond. How to file 2011 income tax The savings bond interest qualified for the exclusion. How to file 2011 income tax They figure their taxable benefits by completing Worksheet 1. How to file 2011 income tax Because they have qualified U. How to file 2011 income tax S. How to file 2011 income tax savings bond interest, they follow the note at the beginning of the worksheet and use the amount from line 2 of their Schedule B (Form 1040A or 1040) on line 3 of the worksheet instead of the amount from line 8a of their Form 1040. How to file 2011 income tax On line 3 of the worksheet, they enter $40,500 ($38,000 + $2,500). How to file 2011 income tax Filled-in Worksheet 1. How to file 2011 income tax Figuring Your Taxable Benefits Before you begin: • If you are married filing separately and you lived apart from your spouse for all of 2013, enter “D” to the right of the word “benefits” on Form 1040, line 20a, or Form 1040A, line 14a. How to file 2011 income tax • Do not use this worksheet if you repaid benefits in 2013 and your total repayments (box 4 of Forms SSA-1099 and RRB-1099) were more than your gross benefits for 2013 (box 3 of Forms SSA-1099 and RRB-1099). How to file 2011 income tax None of your benefits are taxable for 2013. How to file 2011 income tax For more information, see Repayments More Than Gross Benefits. How to file 2011 income tax • If you are filing Form 8815, Exclusion of Interest From Series EE and I U. How to file 2011 income tax S. How to file 2011 income tax Savings Bonds Issued After 1989, do not include the amount from line 8a of Form 1040 or Form 1040A on line 3 of this worksheet. How to file 2011 income tax Instead, include the amount from Schedule B (Form 1040A or 1040), line 2. How to file 2011 income tax 1. How to file 2011 income tax Enter the total amount from box 5 of ALL your Forms SSA-1099 and RRB-1099. How to file 2011 income tax Also enter this amount on Form 1040, line 20a, or Form 1040A, line 14a $10,000 2. How to file 2011 income tax Enter one-half of line 1 5,000 3. How to file 2011 income tax Combine the amounts from:     Form 1040: Lines 7, 8a, 9a, 10 through 14, 15b, 16b, 17 through 19, and 21. How to file 2011 income tax     Form 1040A: Lines 7, 8a, 9a, 10, 11b, 12b, and 13 40,500 4. How to file 2011 income tax Enter the amount, if any, from Form 1040 or 1040A, line 8b -0-       5. How to file 2011 income tax Enter the total of any exclusions/adjustments for: Adoption benefits (Form 8839, line 28), Foreign earned income or housing (Form 2555, lines 45 and 50, or Form 2555-EZ, line 18), and Certain income of bona fide residents of American Samoa (Form 4563, line 15) or Puerto Rico -0-       6. How to file 2011 income tax Combine lines 2, 3, 4, and 5 45,500 7. How to file 2011 income tax Form 1040 filers: Enter the amount from Form 1040, lines 23 through 32, and any write-in adjustments you entered on the dotted line next to line 36. How to file 2011 income tax     Form 1040A filers: Enter the amount from Form 1040A, lines 16 and 17 -0- 8. How to file 2011 income tax Is the amount on line 7 less than the amount on line 6?     No. How to file 2011 income tax None of your social security benefits are taxable. How to file 2011 income tax Enter -0- on Form 1040, line 20b, or Form 1040A, line 14b. How to file 2011 income tax   Yes. How to file 2011 income tax Subtract line 7 from line 6 45,500 9. How to file 2011 income tax If you are: Married filing jointly, enter $32,000 Single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013, enter $25,000 32,000   Note. How to file 2011 income tax If you are married filing separately and you lived with your spouse at any time in 2013, skip lines 9 through 16; multiply line 8 by 85% (. How to file 2011 income tax 85) and enter the result on line 17. How to file 2011 income tax Then go to line 18. How to file 2011 income tax   10. How to file 2011 income tax Is the amount on line 9 less than the amount on line 8?     No. How to file 2011 income tax None of your benefits are taxable. How to file 2011 income tax Enter -0- on Form 1040, line 20b, or on Form 1040A, line 14b. How to file 2011 income tax If you are married filing separately and you lived apart from your spouse for all of 2013, be sure you entered “D” to the right of the word “benefits” on Form 1040, line 20a, or on Form 1040A, line 14a. How to file 2011 income tax     Yes. How to file 2011 income tax Subtract line 9 from line 8 13,500 11. How to file 2011 income tax Enter $12,000 if married filing jointly; $9,000 if single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013 12,000 12. How to file 2011 income tax Subtract line 11 from line 10. How to file 2011 income tax If zero or less, enter -0- 1,500 13. How to file 2011 income tax Enter the smaller of line 10 or line 11 12,000 14. How to file 2011 income tax Enter one-half of line 13 6,000 15. How to file 2011 income tax Enter the smaller of line 2 or line 14 5,000 16. How to file 2011 income tax Multiply line 12 by 85% (. How to file 2011 income tax 85). How to file 2011 income tax If line 12 is zero, enter -0- 1,275 17. How to file 2011 income tax Add lines 15 and 16 6,275 18. How to file 2011 income tax Multiply line 1 by 85% (. How to file 2011 income tax 85) 8,500 19. How to file 2011 income tax Taxable benefits. How to file 2011 income tax Enter the smaller of line 17 or line 18. How to file 2011 income tax Also enter this amount on Form 1040, line 20b, or Form 1040A, line 14b $6,275 More than 50% of Joe's net benefits are taxable because the income on line 8 of the worksheet ($45,500) is more than $44,000. How to file 2011 income tax Joe and Betty enter $10,000 on Form 1040, line 20a, and $6,275 on Form 1040, line 20b. How to file 2011 income tax Deductions Related to Your Benefits You may be entitled to deduct certain amounts related to the benefits you receive. How to file 2011 income tax Disability payments. How to file 2011 income tax   You may have received disability payments from your employer or an insurance company that you included as income on your tax return in an earlier year. How to file 2011 income tax If you received a lump-sum payment from SSA or RRB, and you had to repay the employer or insurance company for the disability payments, you can take an itemized deduction for the part of the payments you included in gross income in the earlier year. How to file 2011 income tax If the amount you repay is more than $3,000, you may be able to claim a tax credit instead. How to file 2011 income tax Claim the deduction or credit in the same way explained under Repayments More Than Gross Benefits , later. How to file 2011 income tax Legal expenses. How to file 2011 income tax   You can usually deduct legal expenses that you pay or incur to produce or collect taxable income or in connection with the determination, collection, or refund of any tax. How to file 2011 income tax   Legal expenses for collecting the taxable part of your benefits are deductible as a miscellaneous itemized deduction on Schedule A (Form 1040), line 23. How to file 2011 income tax Repayments More Than Gross Benefits In some situations, your Form SSA-1099 or Form RRB-1099 will show that the total benefits you repaid (box 4) are more than the gross benefits (box 3) you received. How to file 2011 income tax If this occurred, your net benefits in box 5 will be a negative figure (a figure in parentheses) and none of your benefits will be taxable. How to file 2011 income tax Do not use a worksheet in this case. How to file 2011 income tax If you receive more than one form, a negative figure in box 5 of one form is used to offset a positive figure in box 5 of another form for that same year. How to file 2011 income tax If you have any questions about this negative figure, contact your local SSA office or your local RRB field office. How to file 2011 income tax Joint return. How to file 2011 income tax   If you and your spouse file a joint return, and your Form SSA-1099 or RRB-1099 has a negative figure in box 5, but your spouse's does not, subtract the amount in box 5 of your form from the amount in box 5 of your spouse's form. How to file 2011 income tax You do this to get your net benefits when figuring if your combined benefits are taxable. How to file 2011 income tax Example. How to file 2011 income tax John and Mary file a joint return for 2013. How to file 2011 income tax John received Form SSA-1099 showing $3,000 in box 5. How to file 2011 income tax Mary also received Form SSA-1099 and the amount in box 5 was ($500). How to file 2011 income tax John and Mary will use $2,500 ($3,000 minus $500) as the amount of their net benefits when figuring if any of their combined benefits are taxable. How to file 2011 income tax Repayment of benefits received in an earlier year. How to file 2011 income tax   If the total amount shown in box 5 of all of your Forms SSA-1099 and RRB-1099 is a negative figure, you can take an itemized deduction for the part of this negative figure that represents benefits you included in gross income in an earlier year. How to file 2011 income tax Deduction $3,000 or less. How to file 2011 income tax   If this deduction is $3,000 or less, it is subject to the 2%-of-adjusted-gross-income limit that applies to certain miscellaneous itemized deductions. How to file 2011 income tax Claim it on Schedule A (Form 1040), line 23. How to file 2011 income tax Deduction more than $3,000. How to file 2011 income tax    If this deduction is more than $3,000, you should figure your tax two ways: Figure your tax for 2013 with the itemized deduction included on Schedule A, line 28. How to file 2011 income tax Figure your tax for 2013 in the following steps. How to file 2011 income tax Figure the tax without the itemized deduction included on Schedule A, line 28. How to file 2011 income tax For each year after 1983 for which part of the negative figure represents a repayment of benefits, refigure your taxable benefits as if your total benefits for the year were reduced by that part of the negative figure. How to file 2011 income tax Then refigure the tax for that year. How to file 2011 income tax Subtract the total of the refigured tax amounts in (b) from the total of your actual tax amounts. How to file 2011 income tax Subtract the result in (c) from the result in (a). How to file 2011 income tax Compare the tax figured in methods (1) and (2). How to file 2011 income tax Your tax for 2013 is the smaller of the two amounts. How to file 2011 income tax If method (1) results in less tax, take the itemized deduction on Schedule A (Form 1040), line 28. How to file 2011 income tax If method (2) results in less tax, claim a credit for the amount from step 2(c) above on Form 1040, line 71. How to file 2011 income tax Check box d and enter “I. How to file 2011 income tax R. How to file 2011 income tax C. How to file 2011 income tax 1341” in the space next to that box. How to file 2011 income tax If both methods produce the same tax, deduct the repayment on Schedule A (Form 1040), line 28. How to file 2011 income tax Prev  Up  Next   Home   More Online Publications
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How to file 2011 income tax 6. How to file 2011 income tax   Retail Tax on Heavy Trucks, Trailers, and Tractors Table of Contents Highway vehicle. How to file 2011 income tax Vehicles not considered highway vehicles. How to file 2011 income tax Idling reduction device. How to file 2011 income tax Separate purchase. How to file 2011 income tax Leases. How to file 2011 income tax Exported vehicle. How to file 2011 income tax Tax on resale of tax-paid trailers and semitrailers. How to file 2011 income tax Use treated as sale. How to file 2011 income tax Sale. How to file 2011 income tax Long-term lease. How to file 2011 income tax Short-term lease. How to file 2011 income tax Related person. How to file 2011 income tax Exclusions from tax base. How to file 2011 income tax Sales not at arm's length. How to file 2011 income tax Installment sales. How to file 2011 income tax Repairs and modifications. How to file 2011 income tax Further manufacture. How to file 2011 income tax Rail trailers and rail vans. How to file 2011 income tax Parts and accessories. How to file 2011 income tax Trash containers. How to file 2011 income tax House trailers. How to file 2011 income tax Camper coaches or bodies for self-propelled mobile homes. How to file 2011 income tax Farm feed, seed, and fertilizer equipment. How to file 2011 income tax Ambulances and hearses. How to file 2011 income tax Truck-tractors. How to file 2011 income tax Concrete mixers. How to file 2011 income tax Registration requirement. How to file 2011 income tax Further manufacture. How to file 2011 income tax A tax of 12% of the sales price is imposed on the first retail sale of the following articles, including related parts and accessories sold on or in connection with, or with the sale of, the articles. How to file 2011 income tax Truck chassis and bodies. How to file 2011 income tax Truck trailer and semitrailer chassis and bodies. How to file 2011 income tax Tractors of the kind chiefly used for highway transportation in combination with a trailer or semitrailer. How to file 2011 income tax A truck is a highway vehicle primarily designed to transport its load on the same chassis as the engine, even if it is equipped to tow a vehicle, such as a trailer or semitrailer. How to file 2011 income tax A tractor is a highway vehicle designed to tow a vehicle, such as a trailer or semitrailer. How to file 2011 income tax A tractor may carry incidental items of cargo when towing or limited amounts of cargo when not towing. How to file 2011 income tax A sale of a truck, truck trailer, or semitrailer is considered a sale of a chassis and a body. How to file 2011 income tax The seller is liable for the tax. How to file 2011 income tax Chassis or body. How to file 2011 income tax   A chassis or body is taxable only if you sell it for use as a component part of a highway vehicle that is a truck, truck trailer or semitrailer, or a tractor of the kind chiefly used for highway transportation in combination with a trailer or semitrailer. How to file 2011 income tax Highway vehicle. How to file 2011 income tax   A highway vehicle is any self-propelled vehicle designed to carry a load over public highways, whether or not it is also designed to perform other functions. How to file 2011 income tax Examples of vehicles designed to carry a load over public highways are passenger automobiles, motorcycles, buses, and highway-type trucks and truck tractors. How to file 2011 income tax A vehicle is a highway vehicle even though the vehicle's design allows it to perform a highway transportation function for only one of the following. How to file 2011 income tax A particular type of load, such as passengers, furnishings, and personal effects (as in a house, office, or utility trailer). How to file 2011 income tax A special kind of cargo, goods, supplies, or materials. How to file 2011 income tax Some off-highway task unrelated to highway transportation, except as discussed next. How to file 2011 income tax Vehicles not considered highway vehicles. How to file 2011 income tax   Generally, the following kinds of vehicles are not considered highway vehicles for purposes of the retail tax. How to file 2011 income tax Specially designed mobile machinery for nontransportation functions. How to file 2011 income tax A self-propelled vehicle is not a highway vehicle if all the following apply. How to file 2011 income tax The chassis has permanently mounted to it machinery or equipment used to perform certain operations (construction, manufacturing, drilling, mining, timbering, processing, farming, or similar operations) if the operation of the machinery or equipment is unrelated to transportation on or off the public highways. How to file 2011 income tax The chassis has been specially designed to serve only as a mobile carriage and mount (and power source, if applicable) for the machinery or equipment, whether or not the machinery or equipment is in operation. How to file 2011 income tax The chassis could not, because of its special design and without substantial structural modification, be used as part of a vehicle designed to carry any other load. How to file 2011 income tax Vehicles specially designed for off-highway transportation. How to file 2011 income tax A vehicle is not treated as a highway vehicle if the vehicle is specially designed for the primary function of transporting a particular type of load other than over the public highway and because of this special design, the vehicles's capability to transport a load over a public highway is substantially limited or impaired. How to file 2011 income tax To make this determination, you can take into account the vehicle's size, whether the vehicle is subject to licensing, safety, or other requirements, and whether the vehicle can transport a load at a sustained speed of at least 25 miles per hour. How to file 2011 income tax It does not matter that the vehicle can carry heavier loads off highway than it is allowed to carry over the highway. How to file 2011 income tax Nontransportation trailers and semitrailers. How to file 2011 income tax A trailer or semitrailer is not treated as a highway vehicle if it is specially designed to function only as an enclosed stationary shelter for carrying on a nontransportation function at an off-highway site. How to file 2011 income tax For example, a trailer that is capable only of functioning as an office for an off-highway construction operation is not a highway vehicle. How to file 2011 income tax Gross vehicle weight. How to file 2011 income tax   The tax does not apply to truck chassis and bodies suitable for use with a vehicle that has a gross vehicle weight (defined below) of 33,000 pounds or less. How to file 2011 income tax It also does not apply to truck trailer and semitrailer chassis and bodies suitable for use with a trailer or semitrailer that has a gross vehicle weight of 26,000 pounds or less. How to file 2011 income tax Tractors that have a gross vehicle weight of 19,500 pounds or less and a gross combined weight of 33,000 pounds or less are excluded from the 12% retail tax. How to file 2011 income tax   The following four classifications of truck body types meet the suitable for use standard and will be excluded from the retail excise tax. How to file 2011 income tax Platform truck bodies 21 feet or less in length. How to file 2011 income tax Dry freight and refrigerated truck van bodies 24 feet or less in length. How to file 2011 income tax Dump truck bodies with load capacities of 8 cubic yards or less. How to file 2011 income tax Refuse packer truck bodies with load capacities of 20 cubic yards or less. How to file 2011 income tax For more information on these classifications, see Revenue Procedure 2005-19, which is on page 832 of I. How to file 2011 income tax R. How to file 2011 income tax B. How to file 2011 income tax 2005-14 at www. How to file 2011 income tax irs. How to file 2011 income tax gov/pub/irs-irbs/irb05-14. How to file 2011 income tax pdf. How to file 2011 income tax   The gross vehicle weight means the maximum total weight of a loaded vehicle. How to file 2011 income tax Generally, this maximum total weight is the gross vehicle weight rating provided by the manufacturer or determined by the seller of the completed article. How to file 2011 income tax The seller's gross vehicle weight rating is determined solely on the basis of the strength of the chassis frame and the axle capacity and placement. How to file 2011 income tax The seller may not take into account any readily attachable components (such as tires or rim assemblies) in determining the gross vehicle weight. How to file 2011 income tax See Regulations section 145. How to file 2011 income tax 4051-1(e)(3) for more information. How to file 2011 income tax Parts or accessories. How to file 2011 income tax   The tax applies to parts or accessories sold on or in connection with, or with the sale of, a taxable article. How to file 2011 income tax For example, if at the time of the sale by the retailer, the part or accessory has been ordered from the retailer, the part or accessory will be considered as sold in connection with the sale of the vehicle. How to file 2011 income tax The tax applies in this case whether or not the retailer bills the parts or accessories separately. How to file 2011 income tax   If the retailer sells a taxable chassis, body, or tractor without parts or accessories considered essential for the operation or appearance of the taxable article, the sale of the parts or accessories by the retailer to the purchaser is considered made in connection with the sale of the taxable article even though they are shipped separately, at the same time, or on a different date. How to file 2011 income tax The tax applies unless there is evidence to the contrary. How to file 2011 income tax For example, if a retailer sells to any person a chassis and the bumpers for the chassis, or sells a taxable tractor and the fifth wheel and attachments, the tax applies to the parts or accessories regardless of the method of billing or the time at which the shipments were made. How to file 2011 income tax The tax does not apply to parts and accessories that are spares or replacements. How to file 2011 income tax   The tax imposed on parts and accessories sold on or in connection with the taxable articles listed earlier and the tax imposed on the separate purchase of parts and accessories (discussed next) for the taxable articles listed earlier do not apply to an idling reduction device or insulation that has an R value of at least R35 per inch. How to file 2011 income tax Idling reduction device. How to file 2011 income tax   An idling reduction device is any device or system of devices that provide the tractor with services, such as heat, air conditioning, and electricity, without the use of the main drive engine while the tractor is temporarily parked or stationary. How to file 2011 income tax The device must be affixed to the tractor and determined by the Administrator of the EPA, in consultation with the Secretary of Energy and Secretary of Transportation, to reduce idling while parked or stationary. How to file 2011 income tax The EPA discusses idling reduction technologies on its website at www. How to file 2011 income tax epa. How to file 2011 income tax gov/smartway/technology/idling. How to file 2011 income tax htm. How to file 2011 income tax Separate purchase. How to file 2011 income tax   The tax generally applies to the price of a part or accessory and its installation if the following conditions are met. How to file 2011 income tax The owner, lessee, or operator of any vehicle that contains a taxable article installs any part or accessory on the vehicle. How to file 2011 income tax The installation occurs within 6 months after the vehicle is first placed in service. How to file 2011 income tax   The owners of the trade or business installing the parts or accessories are secondarily liable for the tax. How to file 2011 income tax   A vehicle is placed in service on the date the owner takes actual possession of the vehicle. How to file 2011 income tax This date is established by a signed delivery ticket or other comparable document indicating delivery to and acceptance by the owner. How to file 2011 income tax   The tax does not apply if the installed part or accessory is a replacement part or accessory. How to file 2011 income tax The tax also does not apply if the total price of the parts and accessories, including installation charges, during the 6-month period is $1,000 or less. How to file 2011 income tax However, if the total price is more than $1,000, the tax applies to the cost of all parts and accessories (and installation charges) during that period. How to file 2011 income tax Example. How to file 2011 income tax You bought a taxable vehicle and placed it in service on April 8. How to file 2011 income tax On May 3, you bought and installed parts and accessories at a cost of $850. How to file 2011 income tax On July 15, you bought and installed parts and accessories for $300. How to file 2011 income tax Tax of $138 (12% of $1,150) applies on July 15. How to file 2011 income tax Also, tax will apply to any costs of additional parts and accessories installed on the vehicle before October 8. How to file 2011 income tax First retail sale defined. How to file 2011 income tax   The sale of an article is treated as the first retail sale, and the seller will be liable for the tax imposed on the sale unless one of the following exceptions applies. How to file 2011 income tax There has been a prior taxable sale, lease, or use of the article (however, see Tax on resale of tax-paid trailers and semitrailers, later). How to file 2011 income tax The sale qualifies as a tax-free sale under section 4221 (see Sales exempt from tax, later). How to file 2011 income tax The seller in good faith accepts from the purchaser a statement signed under penalties of perjury and executed in good faith that the purchaser intends to resell the article or lease it on a long-term basis. How to file 2011 income tax There is no registration requirement. How to file 2011 income tax Leases. How to file 2011 income tax   A long-term lease (a lease with a term of 1 year or more, taking into account options to renew) before a first retail sale is treated as a taxable sale. How to file 2011 income tax The tax is imposed on the lessor at the time of the lease. How to file 2011 income tax   A short-term lease (a lease with a term of less than 1 year, taking into account options to renew) before a first retail sale is treated as a taxable use. How to file 2011 income tax The tax is imposed on the lessor at the time of the lease. How to file 2011 income tax Exported vehicle. How to file 2011 income tax   A vehicle exported before its first retail sale, used in a foreign country, and then returned to the United States is subject to the retail tax on its first domestic use or retail sale after importation. How to file 2011 income tax Tax on resale of tax-paid trailers and semitrailers. How to file 2011 income tax   The tax applies to a trailer or semitrailer resold within 6 months after having been sold in a taxable sale. How to file 2011 income tax The seller liable for the tax on the resale can claim a credit equal to the tax paid on the prior taxable sale. How to file 2011 income tax The credit cannot exceed the tax on the resale. How to file 2011 income tax See Regulations section 145. How to file 2011 income tax 4052-1(a)(4) for information on the conditions to allowance for the credit. How to file 2011 income tax Use treated as sale. How to file 2011 income tax   If any person uses a taxable article before the first retail sale of the article, that person is liable for the tax as if the article had been sold at retail by that person. How to file 2011 income tax Figure the tax on the price at which similar articles are sold in the ordinary course of trade by retailers. How to file 2011 income tax The tax attaches when the use begins. How to file 2011 income tax   If the seller of an article regularly sells the articles at retail in arm's-length transactions, figure the tax on its use on the lowest established retail price for the articles in effect at the time of the taxable use. How to file 2011 income tax   If the seller of an article does not regularly sell the articles at retail in arm's-length transactions, a constructive price on which the tax is figured will be determined by the IRS after considering the selling practices and price structures of sellers of similar articles. How to file 2011 income tax   If a seller of an article incurs liability for tax on the use of the article and later sells or leases the article in a transaction that otherwise would be taxable, liability for tax is not incurred on the later sale or lease. How to file 2011 income tax Presumptive retail sales price. How to file 2011 income tax   There are rules to ensure that the tax base of transactions considered to be taxable sales includes either an actual or presumed markup percentage. How to file 2011 income tax If the person liable for tax is the vehicle's manufacturer, producer, or importer, the following discussions show how you figure the presumptive retail sales price depending on the type of transaction and the persons involved in the transaction. How to file 2011 income tax Table 6-1 outlines the appropriate tax base calculation for various transactions. How to file 2011 income tax   The presumed markup percentage to be used for trucks and truck-tractors is 4%. How to file 2011 income tax But for truck trailers and semitrailers and remanufactured trucks and tractors, the presumed markup percentage is zero. How to file 2011 income tax Sale. How to file 2011 income tax   For a taxable sale by a manufacturer, producer, importer, or related person, you generally figure the tax on a tax base of the sales price plus an amount equal to the presumed markup percentage times that sales price. How to file 2011 income tax Long-term lease. How to file 2011 income tax   In the case of a long-term lease by a manufacturer, producer, importer, or related person, figure the tax on a tax base of the constructive sales price plus an amount equal to the presumed markup percentage times the constructive sales price. How to file 2011 income tax Short-term lease. How to file 2011 income tax   When a manufacturer, producer, importer, or related person leases an article in a short-term lease considered a taxable use, figure the tax on a constructive sales price at which those or similar articles generally are sold in the ordinary course of trade by retailers. How to file 2011 income tax   But if the lessor in this situation regularly sells articles at retail in arm's-length transactions, figure the tax on the lowest established retail price in effect at the time of the taxable use. How to file 2011 income tax   If a person other than the manufacturer, producer, importer, or related person leases an article in a short-term lease considered a taxable use, figure the tax on a tax base of the price for which the article was sold to the lessor plus the cost of parts and accessories installed by the lessor and a presumed markup percentage. How to file 2011 income tax Related person. How to file 2011 income tax   A related person is any member of the same controlled group as the manufacturer, producer, or importer. How to file 2011 income tax Do not treat as a related person a person that sells the articles through a permanent retail establishment in the normal course of being a retailer if that person has records to prove the article was sold for a price that included a markup equal to or greater than the presumed markup percentage. How to file 2011 income tax Table 6-1. How to file 2011 income tax Tax Base IF the transaction is a. How to file 2011 income tax . How to file 2011 income tax . How to file 2011 income tax THEN figuring the base by using the. How to file 2011 income tax . How to file 2011 income tax . How to file 2011 income tax Sale by the manufacturer, producer, importer, or related person Sales price plus (presumed markup percentage × sales price) Sale by the dealer Total consideration paid for the item including any charges incident to placing it in a condition ready for use Long-term lease by the manufacturer, producer, importer, or related person Constructive sales price plus (presumed markup percentage × constructive sales price) Short-term lease by the manufacturer, producer, importer, or related person Constructive sales price at which such or similar articles are sold Short-term lease by a lessor other than the manufacturer, producer, importer, or related person Price for which the article was sold to the lessor plus the cost of parts and accessories installed by the lessor plus a presumed markup percentage Short-term lease where the articles are regularly sold at arm's length Lowest established retail price in effect at the time of the taxable use General rule for sales by dealers to the consumer. How to file 2011 income tax   For a taxable sale, other than a long-term lease, by a person other than a manufacturer, producer, importer, or related person, your tax base is the retail sales price as discussed next under Determination of tax base. How to file 2011 income tax   When you sell an article to the consumer, generally you do not add a presumed markup to the tax base. How to file 2011 income tax However, you do add a markup if all the following apply. How to file 2011 income tax You do not perform any significant activities relating to the processing of the sale of a taxable article. How to file 2011 income tax The main reason for processing the sale through you is to avoid or evade the presumed markup. How to file 2011 income tax You do not have records proving that the article was sold for a price that included a markup equal to or greater than the presumed markup percentage. How to file 2011 income tax In these situations, your tax base is the sales price plus an amount equal to the presumed markup percentage times that selling price. How to file 2011 income tax Determination of tax base. How to file 2011 income tax   These rules apply to both normal retail sales price and presumptive retail sales price computations. How to file 2011 income tax To arrive at the tax base, the price is the total consideration paid (including trade-in allowance) for the item and includes any charge incident to placing the article in a condition ready for use. How to file 2011 income tax However, see Presumptive retail sales price, earlier. How to file 2011 income tax Exclusions from tax base. How to file 2011 income tax   Exclude from the tax base the retail excise tax imposed on the sale. How to file 2011 income tax Exclude any state or local retail sales tax if stated as a separate charge from the price whether the sales tax is imposed on the seller or purchaser. How to file 2011 income tax Also exclude the value of any used component of the article furnished by the first user of the article. How to file 2011 income tax   Exclude charges for transportation, delivery, insurance, and installation (other than installation charges for parts and accessories, discussed earlier) and other expenses incurred in connection with the delivery of an article to a purchaser. How to file 2011 income tax These expenses are those incurred in delivery from the retail dealer to the customer. How to file 2011 income tax In the case of delivery directly from the manufacturer to the dealer's customer, include the transportation and delivery charges to the extent the charges do not exceed what it would have cost to ship the article to the dealer. How to file 2011 income tax   Exclude amounts charged for machinery or equipment that does not contribute to the highway transportation function of the vehicle, provided those charges are supported by adequate records. How to file 2011 income tax For example, for an industrial vacuum loader vehicle, exclude amounts charged for the vacuum pump and hose, filter system, material separator, silencer or muffler, control cabinet, and ladder. How to file 2011 income tax Similarly, for a sewer cleaning vehicle, exclude amounts charged for the high pressure water pump, hose components, and the vacuum pipe. How to file 2011 income tax Sales not at arm's length. How to file 2011 income tax   For any taxable article sold (not at arm's length) at less than the fair market price, figure the excise tax on the price for which similar articles are sold at retail in the ordinary course of trade. How to file 2011 income tax   A sale is not at arm's length if either of the following apply. How to file 2011 income tax One of the parties is controlled (in law or in fact) by the other or there is common control, whether or not the control is actually exercised to influence the sales price. How to file 2011 income tax The sale is made under special arrangements between a seller and a purchaser. How to file 2011 income tax Installment sales. How to file 2011 income tax   If the first retail sale is an installment sale, or other form of sale in which the sales price is paid in installments, tax liability arises at the time of the sale. How to file 2011 income tax The tax is figured on the entire sales price. How to file 2011 income tax No part of the tax is deferred because the sales price is paid in installments. How to file 2011 income tax Repairs and modifications. How to file 2011 income tax   The tax does not apply to the sale or use of an article that has been repaired or modified unless the cost of the repairs and modifications is more than 75% of the retail price of a comparable new article. How to file 2011 income tax This includes modifications that change the transportation function of an article or restore a wrecked article to a functional condition. How to file 2011 income tax However, this exception generally does not apply to an article that was not subject to the tax when it was new. How to file 2011 income tax Further manufacture. How to file 2011 income tax   The tax does not apply to the use by a person of a taxable article as material in the manufacture or production of, or as a component part of, another article to be manufactured or produced by that person. How to file 2011 income tax Do not treat a person as engaged in the manufacture of any article merely because that person combines the article with a: Coupling device (including any fifth wheel); Wrecker crane; Loading and unloading equipment (including any crane, hoist, winch, or power liftgate); Aerial ladder or tower; Ice and snow control equipment; Earth moving, excavation, and construction equipment; Spreader; Sleeper cab; Cab shield; or Wood or metal floor. How to file 2011 income tax Combining an article with an item in this list does not give rise to taxability. How to file 2011 income tax However, see Parts or accessories discussed earlier. How to file 2011 income tax Articles exempt from tax. How to file 2011 income tax   The tax on heavy trucks, trailers, and tractors does not apply to sales of the articles described in the following discussions. How to file 2011 income tax Rail trailers and rail vans. How to file 2011 income tax   This is any chassis or body of a trailer or semitrailer designed for use both as a highway vehicle and a railroad car (including any parts and accessories designed primarily for use on and in connection with it). How to file 2011 income tax Do not treat a piggyback trailer or semitrailer as designed for use as a railroad car. How to file 2011 income tax Parts and accessories. How to file 2011 income tax   This is any part or accessory sold separately from the truck or trailer, except as described earlier under Parts or accessories and Separate purchase. How to file 2011 income tax Trash containers. How to file 2011 income tax   This is any box, container, receptacle, bin, or similar article that meets all the following conditions. How to file 2011 income tax It is designed to be used as a trash container. How to file 2011 income tax It is not designed to carry freight other than trash. How to file 2011 income tax It is not designed to be permanently mounted on or affixed to a truck chassis or body. How to file 2011 income tax House trailers. How to file 2011 income tax   This is any house trailer (regardless of size) suitable for use in connection with either passenger automobiles or trucks. How to file 2011 income tax Camper coaches or bodies for self-propelled mobile homes. How to file 2011 income tax   This is any article designed to be mounted or placed on trucks, truck chassis, or automobile chassis and to be used primarily as living quarters or camping accommodations. How to file 2011 income tax Further, the tax does not apply to chassis specifically designed and constructed to accommodate and transport self-propelled mobile home bodies. How to file 2011 income tax Farm feed, seed, and fertilizer equipment. How to file 2011 income tax   This is any body primarily designed to process or prepare, haul, spread, load, or unload feed, seed, or fertilizer to or on farms. How to file 2011 income tax This exemption applies only to the farm equipment body (and parts and accessories) and not to the chassis upon which the farm equipment is mounted. How to file 2011 income tax Ambulances and hearses. How to file 2011 income tax   This is any ambulance, hearse, or combination ambulance-hearse. How to file 2011 income tax Truck-tractors. How to file 2011 income tax   This is any truck-tractor specifically designed for use in shifting semitrailers in and around freight yards and freight terminals. How to file 2011 income tax Concrete mixers. How to file 2011 income tax   This is any article designed to be placed or mounted on a truck, truck trailer, or semitrailer chassis to be used to process or prepare concrete. How to file 2011 income tax This exemption does not apply to the chassis on which the article is mounted. How to file 2011 income tax Sales exempt from tax. How to file 2011 income tax   The following sales are ordinarily exempt from tax. How to file 2011 income tax Sales to a state or local government for its exclusive use. How to file 2011 income tax Sales to Indian tribal governments, but only if the transaction involves the exercise of an essential tribal government function. How to file 2011 income tax Sales to a nonprofit educational organization for its exclusive use. How to file 2011 income tax Sales to a qualified blood collector organization (as defined under Communications Tax in chapter 4) for its exclusive use in the collection, storage, or transportation of blood. How to file 2011 income tax Sales for use by the purchaser for further manufacture of other taxable articles (see below). How to file 2011 income tax Sales for export or for resale by the purchaser to a second purchaser for export. How to file 2011 income tax Sales to the United Nations for official use. How to file 2011 income tax Registration requirement. How to file 2011 income tax   In general, the seller and buyer must be registered for a sale to be tax free. How to file 2011 income tax See the Form 637 instructions for more information. How to file 2011 income tax Certain registration exceptions apply in the case of sales to state and local governments, sales to foreign purchasers for export, and sales for resale or long term leasing. How to file 2011 income tax Further manufacture. How to file 2011 income tax   If you buy articles tax free and resell or use them other than in the manufacture of another article, you are liable for the tax on their resale or use just as if you had manufactured and made the first retail sale of them. How to file 2011 income tax Credits or refunds. How to file 2011 income tax   A credit or refund (without interest) of the retail tax on the taxable articles described earlier may be allowable if the tax has been paid with respect to an article and, before any other use, such article is used by any person as a component part of another taxable article manufactured or produced. How to file 2011 income tax The person using the article as a component part is eligible for the credit or refund. How to file 2011 income tax   A credit or refund is allowable if, before any other use, an article is, by any person: Exported, Used or sold for use as supplies for vessels, Sold to a state or local government for its exclusive use, Sold to a nonprofit educational organization for its exclusive use, or Sold to a qualified blood collector organization (as defined under Communications Tax in chapter 4) for its exclusive use in the collection, storage, or transportation of blood. How to file 2011 income tax A credit or refund is also allowable if there is a price readjustment by reason of the return or repossession of an article or by reason of a bona fide discount, rebate, or allowance. How to file 2011 income tax   See also Conditions to allowance in chapter 5. How to file 2011 income tax Tire credit. How to file 2011 income tax   A credit is allowed against the retail tax on the taxable articles described earlier if taxable tires are sold on or in connection with the sale of the article. How to file 2011 income tax The credit is equal to the manufacturers excise tax imposed on the taxable tires (discussed earlier). How to file 2011 income tax This is the section 4051(d) taxable tire credit and is claimed on Schedule C (Form 720) for the same quarter for which the tax on the heavy vehicle is reported. How to file 2011 income tax Prev  Up  Next   Home   More Online Publications