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Irs Forms 1040

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Irs Forms 1040

Irs forms 1040 Publication 15 - Main Content Table of Contents 1. Irs forms 1040 Employer Identification Number (EIN) 2. Irs forms 1040 Who Are Employees?Relief provisions. Irs forms 1040 Business Owned and Operated by Spouses 3. Irs forms 1040 Family Employees 4. Irs forms 1040 Employee's Social Security Number (SSN)Registering for SSNVS. Irs forms 1040 5. Irs forms 1040 Wages and Other CompensationAccountable plan. Irs forms 1040 Nonaccountable plan. Irs forms 1040 Per diem or other fixed allowance. Irs forms 1040 50% test. Irs forms 1040 Health Savings Accounts and medical savings accounts. Irs forms 1040 Nontaxable fringe benefits. Irs forms 1040 When fringe benefits are treated as paid. Irs forms 1040 Valuation of fringe benefits. Irs forms 1040 Withholding on fringe benefits. Irs forms 1040 Depositing taxes on fringe benefits. Irs forms 1040 6. Irs forms 1040 TipsOrdering rule. Irs forms 1040 7. Irs forms 1040 Supplemental Wages 8. Irs forms 1040 Payroll Period 9. Irs forms 1040 Withholding From Employees' WagesIncome Tax Withholding Social Security and Medicare Taxes Part-Time Workers 10. Irs forms 1040 Required Notice to Employees About the Earned Income Credit (EIC) 11. Irs forms 1040 Depositing TaxesWhen To Deposit How To Deposit Deposit Penalties 12. Irs forms 1040 Filing Form 941 or Form 944 13. Irs forms 1040 Reporting Adjustments to Form 941 or Form 944Current Period Adjustments Prior Period Adjustments Wage Repayments 14. Irs forms 1040 Federal Unemployment (FUTA) TaxSuccessor employer. Irs forms 1040 Household employees. Irs forms 1040 When to deposit. Irs forms 1040 Household employees. Irs forms 1040 Electronic filing by reporting agents. Irs forms 1040 16. Irs forms 1040 How To Use the Income Tax Withholding TablesWage Bracket Method Percentage Method Alternative Methods of Income Tax Withholding How To Get Tax Help 1. Irs forms 1040 Employer Identification Number (EIN) If you are required to report employment taxes or give tax statements to employees or annuitants, you need an EIN. Irs forms 1040 The EIN is a nine-digit number the IRS issues. Irs forms 1040 The digits are arranged as follows: 00-0000000. Irs forms 1040 It is used to identify the tax accounts of employers and certain others who have no employees. Irs forms 1040 Use your EIN on all of the items you send to the IRS and SSA. Irs forms 1040 For more information, see Publication 1635, Employer Identification Number: Understanding Your EIN. Irs forms 1040 If you do not have an EIN, you may apply for one online. Irs forms 1040 Go to the IRS. Irs forms 1040 gov and click on the Apply for an EIN Online link under Tools. Irs forms 1040 You may also apply for an EIN by calling 1-800-829-4933, or you can fax or mail Form SS-4, Application for Employer Identification Number, to the IRS. Irs forms 1040 Do not use an SSN in place of an EIN. Irs forms 1040 You should have only one EIN. Irs forms 1040 If you have more than one and are not sure which one to use, call 1-800-829-4933 or 1-800-829-4059 (TDD/TTY for persons who are deaf, hard of hearing, or have a speech disability). Irs forms 1040 Give the numbers you have, the name and address to which each was assigned, and the address of your main place of business. Irs forms 1040 The IRS will tell you which number to use. Irs forms 1040 If you took over another employer's business (see Successor employer in section 9), do not use that employer's EIN. Irs forms 1040 If you have applied for an EIN but do not have your EIN by the time a return is due, file a paper return and write “Applied For” and the date you applied for it in the space shown for the number. Irs forms 1040 2. Irs forms 1040 Who Are Employees? Generally, employees are defined either under common law or under statutes for certain situations. Irs forms 1040 See Publication 15-A for details on statutory employees and nonemployees. Irs forms 1040 Employee status under common law. Irs forms 1040   Generally, a worker who performs services for you is your employee if you have the right to control what will be done and how it will be done. Irs forms 1040 This is so even when you give the employee freedom of action. Irs forms 1040 What matters is that you have the right to control the details of how the services are performed. Irs forms 1040 See Publication 15-A for more information on how to determine whether an individual providing services is an independent contractor or an employee. Irs forms 1040   Generally, people in business for themselves are not employees. Irs forms 1040 For example, doctors, lawyers, veterinarians, and others in an independent trade in which they offer their services to the public are usually not employees. Irs forms 1040 However, if the business is incorporated, corporate officers who work in the business are employees of the corporation. Irs forms 1040   If an employer-employee relationship exists, it does not matter what it is called. Irs forms 1040 The employee may be called an agent or independent contractor. Irs forms 1040 It also does not matter how payments are measured or paid, what they are called, or if the employee works full or part time. Irs forms 1040 Statutory employees. Irs forms 1040   If someone who works for you is not an employee under the common law rules discussed earlier, do not withhold federal income tax from his or her pay, unless backup withholding applies. Irs forms 1040 Although the following persons may not be common law employees, they are considered employees by statute for social security, Medicare, and FUTA tax purposes under certain conditions. Irs forms 1040 An agent (or commission) driver who delivers food, beverages (other than milk), laundry, or dry cleaning for someone else. Irs forms 1040 A full-time life insurance salesperson who sells primarily for one company. Irs forms 1040 A homeworker who works by guidelines of the person for whom the work is done, with materials furnished by and returned to that person or to someone that person designates. Irs forms 1040 A traveling or city salesperson (other than an agent-driver or commission-driver) who works full time (except for sideline sales activities) for one firm or person getting orders from customers. Irs forms 1040 The orders must be for merchandise for resale or supplies for use in the customer's business. Irs forms 1040 The customers must be retailers, wholesalers, contractors, or operators of hotels, restaurants, or other businesses dealing with food or lodging. Irs forms 1040    Statutory nonemployees. Irs forms 1040   Direct sellers, qualified real estate agents, and certain companion sitters are, by law, considered nonemployees. Irs forms 1040 They are generally treated as self-employed for all federal tax purposes, including income and employment taxes. Irs forms 1040 H-2A agricultural workers. Irs forms 1040   On Form W-2, do not check box 13 (Statutory employee), as H-2A workers are not statutory employees. Irs forms 1040 Treating employees as nonemployees. Irs forms 1040   You will generally be liable for social security and Medicare taxes and withheld income tax if you do not deduct and withhold these taxes because you treated an employee as a nonemployee. Irs forms 1040 You may be able to calculate your liability using special section 3509 rates for the employee share of social security and Medicare taxes and the federal income tax withholding. Irs forms 1040 The applicable rates depend on whether you filed required Forms 1099. Irs forms 1040 You cannot recover the employee share of social security, or Medicare tax, or income tax withholding from the employee if the tax is paid under section 3509. Irs forms 1040 You are liable for the income tax withholding regardless of whether the employee paid income tax on the wages. Irs forms 1040 You continue to owe the full employer share of social security and Medicare taxes. Irs forms 1040 The employee remains liable for the employee share of social security and Medicare taxes. Irs forms 1040 See Internal Revenue Code section 3509 for details. Irs forms 1040 Also see the Instructions for Form 941-X. Irs forms 1040   Section 3509 rates are not available if you intentionally disregard the requirement to withhold taxes from the employee or if you withheld income taxes but not social security or Medicare taxes. Irs forms 1040 Section 3509 is not available for reclassifying statutory employees. Irs forms 1040 See Statutory employees , earlier in this section. Irs forms 1040   If the employer issued required information returns, the section 3509 rates are: For social security taxes; employer rate of 6. Irs forms 1040 2% plus 20% of the employee rate (see the Instructions for Form 941-X). Irs forms 1040 For Medicare taxes; employer rate of 1. Irs forms 1040 45% plus 20% of the employee rate of 1. Irs forms 1040 45%, for a total rate of 1. Irs forms 1040 74% of wages. Irs forms 1040 For Additional Medicare Tax; 0. Irs forms 1040 18% (20% of the employee rate of 0. Irs forms 1040 9%) of wages subject to Additional Medicare Tax. Irs forms 1040 For income tax withholding, the rate is 1. Irs forms 1040 5% of wages. Irs forms 1040   If the employer did not issue required information returns, the section 3509 rates are: For social security taxes; employer rate of 6. Irs forms 1040 2% plus 40% of the employee rate (see the Instructions for Form 941-X). Irs forms 1040 For Medicare taxes; employer rate of 1. Irs forms 1040 45% plus 40% of the employee rate of 1. Irs forms 1040 45%, for a total rate of 2. Irs forms 1040 03% of wages. Irs forms 1040 For Additional Medicare Tax; 0. Irs forms 1040 36% (40% of the employee rate of 0. Irs forms 1040 9%) of wages subject to Additional Medicare Tax. Irs forms 1040 For income tax withholding, the rate is 3. Irs forms 1040 0% of wages. Irs forms 1040 Relief provisions. Irs forms 1040   If you have a reasonable basis for not treating a worker as an employee, you may be relieved from having to pay employment taxes for that worker. Irs forms 1040 To get this relief, you must file all required federal tax returns, including information returns, on a basis consistent with your treatment of the worker. Irs forms 1040 You (or your predecessor) must not have treated any worker holding a substantially similar position as an employee for any periods beginning after 1977. Irs forms 1040 See Publication 1976, Do You Qualify for Relief Under Section 530. Irs forms 1040 IRS help. Irs forms 1040   If you want the IRS to determine whether a worker is an employee, file Form SS-8, Determination of Worker Status for Purposes of Federal Employment Taxes and Income Tax Withholding. Irs forms 1040 Voluntary Classification Settlement Program (VCSP). Irs forms 1040   Employers who are currently treating their workers (or a class or group of workers) as independent contractors or other nonemployees and want to voluntarily reclassify their workers as employees for future tax periods may be eligible to participate in the VCSP if certain requirements are met. Irs forms 1040 To apply, use Form 8952, Application for Voluntary Classification Settlement Program (VCSP). Irs forms 1040 For more information visit IRS. Irs forms 1040 gov and enter “VCSP” in the search box. Irs forms 1040 Business Owned and Operated by Spouses If you and your spouse jointly own and operate a business and share in the profits and losses, you are partners in a partnership, whether or not you have a formal partnership agreement. Irs forms 1040 See Publication 541, Partnerships, for more details. Irs forms 1040 The partnership is considered the employer of any employees, and is liable for any employment taxes due on wages paid to its employees. Irs forms 1040 Exception—Qualified joint venture. Irs forms 1040   For tax years beginning after December 31, 2006, the Small Business and Work Opportunity Tax Act of 2007 (Public Law 110-28) provides that a “qualified joint venture,” whose only members are spouses filing a joint income tax return, can elect not to be treated as a partnership for federal tax purposes. Irs forms 1040 A qualified joint venture conducts a trade or business where: The only members of the joint venture are spouses who file a joint income tax return, Both spouses materially participate (see Material participation in the Instructions for Schedule C (Form 1040), line G) in the trade or business (mere joint ownership of property is not enough), Both spouses elect to not be treated as a partnership, and The business is co-owned by both spouses and is not held in the name of a state law entity such as a partnership or limited liability company (LLC). Irs forms 1040   To make the election, all items of income, gain, loss, deduction, and credit must be divided between the spouses, in accordance with each spouse's interest in the venture, and reported on separate Schedules C or F as sole proprietors. Irs forms 1040 Each spouse must also file a separate Schedule SE to pay self-employment taxes, as applicable. Irs forms 1040   Spouses using the qualified joint venture rules are treated as sole proprietors for federal tax purposes and generally do not need an EIN. Irs forms 1040 If employment taxes are owed by the qualified joint venture, either spouse may report and pay the employment taxes due on the wages paid to the employees using the EIN of that spouse's sole proprietorship. Irs forms 1040 Generally, filing as a qualified joint venture will not increase the spouses' total tax owed on the joint income tax return. Irs forms 1040 However, it gives each spouse credit for social security earnings on which retirement benefits are based and for Medicare coverage without filing a partnership return. Irs forms 1040    Note. Irs forms 1040 If your spouse is your employee, not your partner, see One spouse employed by another in section 3. Irs forms 1040   For more information on qualified joint ventures, visit IRS. Irs forms 1040 gov and enter “qualified joint venture” in the search box. Irs forms 1040 Exception—Community income. Irs forms 1040   If you and your spouse wholly own an unincorporated business as community property under the community property laws of a state, foreign country, or U. Irs forms 1040 S. Irs forms 1040 possession, you can treat the business either as a sole proprietorship (of the spouse who carried on the business) or a partnership. Irs forms 1040 You may still make an election to be taxed as a qualified joint venture instead of a partnership. Irs forms 1040 See Exception—Qualified joint venture , earlier. Irs forms 1040 3. Irs forms 1040 Family Employees Child employed by parents. Irs forms 1040   Payments for the services of a child under age 18 who works for his or her parent in a trade or business are not subject to social security and Medicare taxes if the trade or business is a sole proprietorship or a partnership in which each partner is a parent of the child. Irs forms 1040 If these payments are for work other than in a trade or business, such as domestic work in the parent's private home, they are not subject to social security and Medicare taxes until the child reaches age 21. Irs forms 1040 However, see Covered services of a child or spouse , later in this section. Irs forms 1040 Payments for the services of a child under age 21 who works for his or her parent, whether or not in a trade or business, are not subject to FUTA tax. Irs forms 1040 Payments for the services of a child of any age who works for his or her parent are generally subject to income tax withholding unless the payments are for domestic work in the parent's home, or unless the payments are for work other than in a trade or business and are less than $50 in the quarter or the child is not regularly employed to do such work. Irs forms 1040 One spouse employed by another. Irs forms 1040   The wages for the services of an individual who works for his or her spouse in a trade or business are subject to income tax withholding and social security and Medicare taxes, but not to FUTA tax. Irs forms 1040 However, the payments for services of one spouse employed by another in other than a trade or business, such as domestic service in a private home, are not subject to social security, Medicare, and FUTA taxes. Irs forms 1040 Covered services of a child or spouse. Irs forms 1040   The wages for the services of a child or spouse are subject to income tax withholding as well as social security, Medicare, and FUTA taxes if he or she works for: A corporation, even if it is controlled by the child's parent or the individual's spouse; A partnership, even if the child's parent is a partner, unless each partner is a parent of the child; A partnership, even if the individual's spouse is a partner; or An estate, even if it is the estate of a deceased parent. Irs forms 1040 Parent employed by son or daughter. Irs forms 1040   When the employer is a son or daughter employing his or her parent the following rules apply. Irs forms 1040 Payments for the services of a parent in the son’s or daughter’s (the employer’s) trade or business are subject to income tax withholding and social security and Medicare taxes. Irs forms 1040 Payments for the services of a parent not in the son’s or daughter’s (the employer’s) trade or business are generally not subject to social security and Medicare taxes. Irs forms 1040    Social security and Medicare taxes do apply to payments made to a parent for domestic services if all of the following apply: The parent is employed by his or her son or daughter; The son or daughter (the employer) has a child or stepchild living in the home; The son or daughter (the employer) is a widow or widower, divorced, or living with a spouse who, because of a mental or physical condition, cannot care for the child or stepchild for at least 4 continuous weeks in a calendar quarter; and The child or stepchild is either under age 18 or requires the personal care of an adult for at least 4 continuous weeks in a calendar quarter due to a mental or physical condition. Irs forms 1040   Payments made to a parent employed by his or her child are not subject to FUTA tax, regardless of the type of services provided. Irs forms 1040 4. Irs forms 1040 Employee's Social Security Number (SSN) You are required to get each employee's name and SSN and to enter them on Form W-2. Irs forms 1040 This requirement also applies to resident and nonresident alien employees. Irs forms 1040 You should ask your employee to show you his or her social security card. Irs forms 1040 The employee may show the card if it is available. Irs forms 1040 Do not accept a social security card that says “Not valid for employment. Irs forms 1040 ” A social security number issued with this legend does not permit employment. Irs forms 1040 You may, but are not required to, photocopy the social security card if the employee provides it. Irs forms 1040 If you do not provide the correct employee name and SSN on Form W-2, you may owe a penalty unless you have reasonable cause. Irs forms 1040 See Publication 1586, Reasonable Cause Regulations & Requirements for Missing and Incorrect Name/TINs, for information on the requirement to solicit the employee's SSN. Irs forms 1040 Applying for a social security card. Irs forms 1040   Any employee who is legally eligible to work in the United States and does not have a social security card can get one by completing Form SS-5, Application for a Social Security Card, and submitting the necessary documentation. Irs forms 1040 You can get Form SS-5 at SSA offices, by calling 1-800-772-1213, or from the SSA website at www. Irs forms 1040 socialsecurity. Irs forms 1040 gov/online/ss-5. Irs forms 1040 html. Irs forms 1040 The employee must complete and sign Form SS-5; it cannot be filed by the employer. Irs forms 1040 You may be asked to supply a letter to accompany Form SS-5 if the employee has exceeded his or her yearly or lifetime limit for the number of replacement cards allowed. Irs forms 1040 Applying for a social security number. Irs forms 1040   If you file Form W-2 on paper and your employee applied for an SSN but does not have one when you must file Form W-2, enter “Applied For” on the form. Irs forms 1040 If you are filing electronically, enter all zeros (000-00-000) in the social security number field. Irs forms 1040 When the employee receives the SSN, file Copy A of Form W-2c, Corrected Wage and Tax Statement, with the SSA to show the employee's SSN. Irs forms 1040 Furnish copies B, C, and 2 of Form W-2c to the employee. Irs forms 1040 Up to 25 Forms W-2c for each Form W-3c, Transmittal of Corrected Wage and Tax Statements, may now be filed per session over the Internet, with no limit on the number of sessions. Irs forms 1040 For more information, visit the SSA's Employer W-2 Filing Instructions & Information webpage at www. Irs forms 1040 socialsecurity. Irs forms 1040 gov/employer. Irs forms 1040 Advise your employee to correct the SSN on his or her original Form W-2. Irs forms 1040 Correctly record the employee's name and SSN. Irs forms 1040   Record the name and number of each employee as they are shown on the employee's social security card. Irs forms 1040 If the employee's name is not correct as shown on the card (for example, because of marriage or divorce), the employee should request a corrected card from the SSA. Irs forms 1040 Continue to report the employee's wages under the old name until the employee shows you an updated social security card with the new name. Irs forms 1040 If the SSA issues the employee a replacement card after a name change, or a new card with a different social security number after a change in alien work status, file a Form W-2c to correct the name/SSN reported for the most recently filed Form W-2. Irs forms 1040 It is not necessary to correct other years if the previous name and number were used for years before the most recent Form W-2. Irs forms 1040 IRS individual taxpayer identification numbers (ITINs) for aliens. Irs forms 1040   Do not accept an ITIN in place of an SSN for employee identification or for work. Irs forms 1040 An ITIN is only available to resident and nonresident aliens who are not eligible for U. Irs forms 1040 S. Irs forms 1040 employment and need identification for other tax purposes. Irs forms 1040 You can identify an ITIN because it is a nine-digit number, beginning with the number “9” with either a “7” or “8” as the fourth digit and is formatted like an SSN (for example, 9NN-7N-NNNN). Irs forms 1040    An individual with an ITIN who later becomes eligible to work in the United States must obtain an SSN. Irs forms 1040 If the individual is currently eligible to work in the United States, instruct the individual to apply for an SSN and follow the instructions under Applying for a social security number, earlier. Irs forms 1040 Do not use an ITIN in place of an SSN on Form W-2. Irs forms 1040 Verification of social security numbers. Irs forms 1040   Employers and authorized reporting agents can use the Social Security Number Verification Service (SSNVS) to instantly verify up to 10 names and SSNs (per screen) at a time, or submit an electronic file of up to 250,000 names and SSNs and usually receive the results the next business day. Irs forms 1040 Visit www. Irs forms 1040 socialsecurity. Irs forms 1040 gov/employer/ssnv. Irs forms 1040 htm for more information. Irs forms 1040 Registering for SSNVS. Irs forms 1040   You must register online and receive authorization from your employer to use SSNVS. Irs forms 1040 To register, visit SSA's website at www. Irs forms 1040 ssa. Irs forms 1040 gov/employer and click on the Business Services Online link. Irs forms 1040 Follow the registration instructions to obtain a user identification (ID) and password. Irs forms 1040 You will need to provide the following information about yourself and your company. Irs forms 1040 Name. Irs forms 1040 SSN. Irs forms 1040 Date of birth. Irs forms 1040 Type of employer. Irs forms 1040 EIN. Irs forms 1040 Company name, address, and telephone number. Irs forms 1040 Email address. Irs forms 1040   When you have completed the online registration process, SSA will mail a one-time activation code to your employer. Irs forms 1040 You must enter the activation code online to use SSNVS. Irs forms 1040 5. Irs forms 1040 Wages and Other Compensation Wages subject to federal employment taxes generally include all pay you give to an employee for services performed. Irs forms 1040 The pay may be in cash or in other forms. Irs forms 1040 It includes salaries, vacation allowances, bonuses, commissions, and fringe benefits. Irs forms 1040 It does not matter how you measure or make the payments. Irs forms 1040 Amounts an employer pays as a bonus for signing or ratifying a contract in connection with the establishment of an employer-employee relationship and an amount paid to an employee for cancellation of an employment contract and relinquishment of contract rights are wages subject to social security, Medicare, and FUTA taxes and income tax withholding. Irs forms 1040 Also, compensation paid to a former employee for services performed while still employed is wages subject to employment taxes. Irs forms 1040 More information. Irs forms 1040   See section 6 for a discussion of tips and section 7 for a discussion of supplemental wages. Irs forms 1040 Also, see section 15 for exceptions to the general rules for wages. Irs forms 1040 Publication 15-A provides additional information on wages, including nonqualified deferred compensation, and other compensation. Irs forms 1040 Publication 15-B provides information on other forms of compensation, including: Accident and health benefits, Achievement awards, Adoption assistance, Athletic facilities, De minimis (minimal) benefits, Dependent care assistance, Educational assistance, Employee discounts, Employee stock options, Employer-provided cell phones, Group-term life insurance coverage, Health Savings Accounts, Lodging on your business premises, Meals, Moving expense reimbursements, No-additional-cost services, Retirement planning services, Transportation (commuting) benefits, Tuition reduction, and Working condition benefits. Irs forms 1040 Employee business expense reimbursements. Irs forms 1040   A reimbursement or allowance arrangement is a system by which you pay the advances, reimbursements, and charges for your employees' business expenses. Irs forms 1040 How you report a reimbursement or allowance amount depends on whether you have an accountable or a nonaccountable plan. Irs forms 1040 If a single payment includes both wages and an expense reimbursement, you must specify the amount of the reimbursement. Irs forms 1040   These rules apply to all ordinary and necessary employee business expenses that would otherwise qualify for a deduction by the employee. Irs forms 1040 Accountable plan. Irs forms 1040   To be an accountable plan, your reimbursement or allowance arrangement must require your employees to meet all three of the following rules. Irs forms 1040 They must have paid or incurred deductible expenses while performing services as your employees. Irs forms 1040 The reimbursement or advance must be paid for the expense and must not be an amount that would have otherwise been paid by the employee. Irs forms 1040 They must substantiate these expenses to you within a reasonable period of time. Irs forms 1040 They must return any amounts in excess of substantiated expenses within a reasonable period of time. Irs forms 1040   Amounts paid under an accountable plan are not wages and are not subject to income, social security, Medicare, and FUTA taxes. Irs forms 1040   If the expenses covered by this arrangement are not substantiated (or amounts in excess of substantiated expenses are not returned within a reasonable period of time), the amount paid under the arrangement in excess of the substantiated expenses is treated as paid under a nonaccountable plan. Irs forms 1040 This amount is subject to income, social security, Medicare, and FUTA taxes for the first payroll period following the end of the reasonable period of time. Irs forms 1040   A reasonable period of time depends on the facts and circumstances. Irs forms 1040 Generally, it is considered reasonable if your employees receive their advance within 30 days of the time they incur the expenses, adequately account for the expenses within 60 days after the expenses were paid or incurred, and return any amounts in excess of expenses within 120 days after the expenses were paid or incurred. Irs forms 1040 Also, it is considered reasonable if you give your employees a periodic statement (at least quarterly) that asks them to either return or adequately account for outstanding amounts and they do so within 120 days. Irs forms 1040 Nonaccountable plan. Irs forms 1040   Payments to your employee for travel and other necessary expenses of your business under a nonaccountable plan are wages and are treated as supplemental wages and subject to income, social security, Medicare, and FUTA taxes. Irs forms 1040 Your payments are treated as paid under a nonaccountable plan if: Your employee is not required to or does not substantiate timely those expenses to you with receipts or other documentation, You advance an amount to your employee for business expenses and your employee is not required to or does not return timely any amount he or she does not use for business expenses, You advance or pay an amount to your employee regardless of whether you reasonably expect the employee to have business expenses related to your business, or You pay an amount as a reimbursement you would have otherwise paid as wages. Irs forms 1040   See section 7 for more information on supplemental wages. Irs forms 1040 Per diem or other fixed allowance. Irs forms 1040   You may reimburse your employees by travel days, miles, or some other fixed allowance under the applicable revenue procedure. Irs forms 1040 In these cases, your employee is considered to have accounted to you if your reimbursement does not exceed rates established by the Federal Government. Irs forms 1040 The 2013 standard mileage rate for auto expenses was 56. Irs forms 1040 5 cents per mile. Irs forms 1040 The rate for 2014 is 56 cents per mile. Irs forms 1040   The government per diem rates for meals and lodging in the continental United States are listed in Publication 1542, Per Diem Rates. Irs forms 1040 Other than the amount of these expenses, your employees' business expenses must be substantiated (for example, the business purpose of the travel or the number of business miles driven). Irs forms 1040   If the per diem or allowance paid exceeds the amounts substantiated, you must report the excess amount as wages. Irs forms 1040 This excess amount is subject to income tax withholding and payment of social security, Medicare, and FUTA taxes. Irs forms 1040 Show the amount equal to the substantiated amount (for example, the nontaxable portion) in box 12 of Form W-2 using code “L. Irs forms 1040 ” Wages not paid in money. Irs forms 1040   If in the course of your trade or business you pay your employees in a medium that is neither cash nor a readily negotiable instrument, such as a check, you are said to pay them “in kind. Irs forms 1040 ” Payments in kind may be in the form of goods, lodging, food, clothing, or services. Irs forms 1040 Generally, the fair market value of such payments at the time they are provided is subject to federal income tax withholding and social security, Medicare, and FUTA taxes. Irs forms 1040   However, noncash payments for household work, agricultural labor, and service not in the employer's trade or business are exempt from social security, Medicare, and FUTA taxes. Irs forms 1040 Withhold income tax on these payments only if you and the employee agree to do so. Irs forms 1040 Nonetheless, noncash payments for agricultural labor, such as commodity wages, are treated as cash payments subject to employment taxes if the substance of the transaction is a cash payment. Irs forms 1040 Moving expenses. Irs forms 1040   Reimbursed and employer-paid qualified moving expenses (those that would otherwise be deductible by the employee) paid under an accountable plan are not includible in an employee's income unless you have knowledge the employee deducted the expenses in a prior year. Irs forms 1040 Reimbursed and employer-paid nonqualified moving expenses are includible in income and are subject to employment taxes and income tax withholding. Irs forms 1040 For more information on moving expenses, see Publication 521, Moving Expenses. Irs forms 1040 Meals and lodging. Irs forms 1040   The value of meals is not taxable income and is not subject to income tax withholding and social security, Medicare, and FUTA taxes if the meals are furnished for the employer's convenience and on the employer's premises. Irs forms 1040 The value of lodging is not subject to income tax withholding and social security, Medicare, and FUTA taxes if the lodging is furnished for the employer's convenience, on the employer's premises, and as a condition of employment. Irs forms 1040    “For the convenience of the employer” means you have a substantial business reason for providing the meals and lodging other than to provide additional compensation to the employee. Irs forms 1040 For example, meals you provide at the place of work so that an employee is available for emergencies during his or her lunch period are generally considered to be for your convenience. Irs forms 1040   However, whether meals or lodging are provided for the convenience of the employer depends on all of the facts and circumstances. Irs forms 1040 A written statement that the meals or lodging are for your convenience is not sufficient. Irs forms 1040 50% test. Irs forms 1040   If over 50% of the employees who are provided meals on an employer's business premises receive these meals for the convenience of the employer, all meals provided on the premises are treated as furnished for the convenience of the employer. Irs forms 1040 If this 50% test is met, the value of the meals is excludable from income for all employees and is not subject to federal income tax withholding or employment taxes. Irs forms 1040 For more information, see Publication 15-B. Irs forms 1040 Health insurance plans. Irs forms 1040   If you pay the cost of an accident or health insurance plan for your employees, including an employee's spouse and dependents, your payments are not wages and are not subject to social security, Medicare, and FUTA taxes, or federal income tax withholding. Irs forms 1040 Generally, this exclusion also applies to qualified long-term care insurance contracts. Irs forms 1040 However, for income tax withholding, the value of health insurance benefits must be included in the wages of S corporation employees who own more than 2% of the S corporation (2% shareholders). Irs forms 1040 For social security, Medicare, and FUTA taxes, the health insurance benefits are excluded from the wages only for employees and their dependents or for a class or classes of employees and their dependents. Irs forms 1040 See Announcement 92-16 for more information. Irs forms 1040 You can find Announcement 92-16 on page 53 of Internal Revenue Bulletin 1992-5. Irs forms 1040 Health Savings Accounts and medical savings accounts. Irs forms 1040   Your contributions to an employee's Health Savings Account (HSA) or Archer medical savings account (MSA) are not subject to social security, Medicare, or FUTA taxes, or federal income tax withholding if it is reasonable to believe at the time of payment of the contributions they will be excludable from the income of the employee. Irs forms 1040 To the extent it is not reasonable to believe they will be excludable, your contributions are subject to these taxes. Irs forms 1040 Employee contributions to their HSAs or MSAs through a payroll deduction plan must be included in wages and are subject to social security, Medicare, and FUTA taxes and income tax withholding. Irs forms 1040 However, HSA contributions made under a salary reduction arrangement in a section 125 cafeteria plan are not wages and are not subject to employment taxes or withholding. Irs forms 1040 For more information, see the Instructions for Form 8889, Health Savings Accounts (HSAs). Irs forms 1040 Medical care reimbursements. Irs forms 1040   Generally, medical care reimbursements paid for an employee under an employer's self-insured medical reimbursement plan are not wages and are not subject to social security, Medicare, and FUTA taxes, or income tax withholding. Irs forms 1040 See Publication 15-B for an exception for highly compensated employees. Irs forms 1040 Differential wage payments. Irs forms 1040   Differential wage payments are any payments made by an employer to an individual for a period during which the individual is performing service in the uniformed services while on active duty for a period of more than 30 days and represent all or a portion of the wages the individual would have received from the employer if the individual were performing services for the employer. Irs forms 1040   Differential wage payments are wages for income tax withholding, but are not subject to social security, Medicare, or FUTA taxes. Irs forms 1040 Employers should report differential wage payments in box 1 of Form W-2. Irs forms 1040 For more information about the tax treatment of differential wage payments, visit IRS. Irs forms 1040 gov and enter “employees in a combat zone” in the search box. Irs forms 1040 Fringe benefits. Irs forms 1040   You generally must include fringe benefits in an employee's gross income (but see Nontaxable fringe benefits next). Irs forms 1040 The benefits are subject to income tax withholding and employment taxes. Irs forms 1040 Fringe benefits include cars you provide, flights on aircraft you provide, free or discounted commercial flights, vacations, discounts on property or services, memberships in country clubs or other social clubs, and tickets to entertainment or sporting events. Irs forms 1040 In general, the amount you must include is the amount by which the fair market value of the benefits is more than the sum of what the employee paid for it plus any amount the law excludes. Irs forms 1040 There are other special rules you and your employees may use to value certain fringe benefits. Irs forms 1040 See Publication 15-B for more information. Irs forms 1040 Nontaxable fringe benefits. Irs forms 1040   Some fringe benefits are not taxable (or are minimally taxable) if certain conditions are met. Irs forms 1040 See Publication 15-B for details. Irs forms 1040 The following are some examples of nontaxable fringe benefits. Irs forms 1040 Services provided to your employees at no additional cost to you. Irs forms 1040 Qualified employee discounts. Irs forms 1040 Working condition fringes that are property or services the employee could deduct as a business expense if he or she had paid for it. Irs forms 1040 Examples include a company car for business use and subscriptions to business magazines. Irs forms 1040 Certain minimal value fringes (including an occasional cab ride when an employee must work overtime and meals you provide at eating places you run for your employees if the meals are not furnished at below cost). Irs forms 1040 Qualified transportation fringes subject to specified conditions and dollar limitations (including transportation in a commuter highway vehicle, any transit pass, and qualified parking). Irs forms 1040 Qualified moving expense reimbursement. Irs forms 1040 See Moving expenses , earlier in this section, for details. Irs forms 1040 The use of on-premises athletic facilities, if substantially all of the use is by employees, their spouses, and their dependent children. Irs forms 1040 Qualified tuition reduction an educational organization provides to its employees for education. Irs forms 1040 For more information, see Publication 970, Tax Benefits for Education. Irs forms 1040 Employer-provided cell phones provided primarily for a noncompensatory business reason. Irs forms 1040   However, do not exclude the following fringe benefits from the income of highly compensated employees unless the benefit is available to other employees on a nondiscriminatory basis. Irs forms 1040 No-additional-cost services. Irs forms 1040 Qualified employee discounts. Irs forms 1040 Meals provided at an employer operated eating facility. Irs forms 1040 Reduced tuition for education. Irs forms 1040  For more information, including the definition of a highly compensated employee, see Publication 15-B. Irs forms 1040 When fringe benefits are treated as paid. Irs forms 1040   You may choose to treat certain noncash fringe benefits as paid by the pay period, by the quarter, or on any other basis you choose as long as you treat the benefits as paid at least once a year. Irs forms 1040 You do not have to make a formal choice of payment dates or notify the IRS of the dates you choose. Irs forms 1040 You do not have to make this choice for all employees. Irs forms 1040 You may change methods as often as you like, as long as you treat all benefits provided in a calendar year as paid by December 31 of the calendar year. Irs forms 1040 See Publication 15-B for more information, including a discussion of the special accounting rule for fringe benefits provided during November and December. Irs forms 1040 Valuation of fringe benefits. Irs forms 1040   Generally, you must determine the value of fringe benefits no later than January 31 of the next year. Irs forms 1040 Before January 31, you may reasonably estimate the value of the fringe benefits for purposes of withholding and depositing on time. Irs forms 1040 Withholding on fringe benefits. Irs forms 1040   You may add the value of fringe benefits to regular wages for a payroll period and figure withholding taxes on the total, or you may withhold federal income tax on the value of the fringe benefits at the optional flat 25% supplemental wage rate. Irs forms 1040 However, see Withholding on supplemental wages when an employee receives more than $1 million of supplemental wages during the calendar year in section 7. Irs forms 1040   You may choose not to withhold income tax on the value of an employee's personal use of a vehicle you provide. Irs forms 1040 You must, however, withhold social security and Medicare taxes on the use of the vehicle. Irs forms 1040 See Publication 15-B for more information on this election. Irs forms 1040 Depositing taxes on fringe benefits. Irs forms 1040   Once you choose when fringe benefits are paid, you must deposit taxes in the same deposit period you treat the fringe benefits as paid. Irs forms 1040 To avoid a penalty, deposit the taxes following the general deposit rules for that deposit period. Irs forms 1040   If you determine by January 31 you overestimated the value of a fringe benefit at the time you withheld and deposited for it, you may claim a refund for the overpayment or have it applied to your next employment tax return. Irs forms 1040 See Valuation of fringe benefits , earlier. Irs forms 1040 If you underestimated the value and deposited too little, you may be subject to a failure-to-deposit penalty. Irs forms 1040 See section 11 for information on deposit penalties. Irs forms 1040   If you deposited the required amount of taxes but withheld a lesser amount from the employee, you can recover from the employee the social security, Medicare, or income taxes you deposited on his or her behalf, and included in the employee's Form W-2. Irs forms 1040 However, you must recover the income taxes before April 1 of the following year. Irs forms 1040 Sick pay. Irs forms 1040   In general, sick pay is any amount you pay under a plan to an employee who is unable to work because of sickness or injury. Irs forms 1040 These amounts are sometimes paid by a third party, such as an insurance company or an employees' trust. Irs forms 1040 In either case, these payments are subject to social security, Medicare, and FUTA taxes. Irs forms 1040 Sick pay becomes exempt from these taxes after the end of 6 calendar months after the calendar month the employee last worked for the employer. Irs forms 1040 The payments are always subject to federal income tax. Irs forms 1040 See Publication 15-A for more information. Irs forms 1040 6. Irs forms 1040 Tips Tips your employee receives from customers are generally subject to withholding. Irs forms 1040 Your employee must report cash tips to you by the 10th of the month after the month the tips are received. Irs forms 1040 The report should include tips you paid over to the employee for charge customers, tips the employee received directly from customers, and tips received from other employees under any tip-sharing arrangement. Irs forms 1040 Both directly and indirectly tipped employees must report tips to you. Irs forms 1040 No report is required for months when tips are less than $20. Irs forms 1040 Your employee reports the tips on Form 4070, Employee's Report of Tips to Employer, or on a similar statement. Irs forms 1040 The statement must be signed by the employee and must include: The employee's name, address, and SSN, Your name and address, The month or period the report covers, and The total of tips received during the month or period. Irs forms 1040 Both Forms 4070 and 4070-A, Employee's Daily Record of Tips, are included in Publication 1244, Employee's Daily Record of Tips and Report to Employer. Irs forms 1040 You are permitted to establish a system for electronic tip reporting by employees. Irs forms 1040 See Regulations section 31. Irs forms 1040 6053-1(d). Irs forms 1040 Collecting taxes on tips. Irs forms 1040   You must collect income tax, employee social security tax, and employee Medicare tax on the employee's tips. Irs forms 1040 The withholding rules for withholding an employee's share of Medicare tax on tips also apply to withholding the Additional Medicare Tax once wages and tips exceed $200,000 in the calendar year. Irs forms 1040 If an employee reports to you in writing $20 or more of tips in a month, the tips are also subject to FUTA tax. Irs forms 1040   You can collect these taxes from the employee's wages or from other funds he or she makes available. Irs forms 1040 See Tips treated as supplemental wages in section 7 for more information. Irs forms 1040 Stop collecting the employee social security tax when his or her wages and tips for tax year 2014 reach $117,000; collect the income and employee Medicare taxes for the whole year on all wages and tips. Irs forms 1040 You are responsible for the employer social security tax on wages and tips until the wages (including tips) reach the limit. Irs forms 1040 You are responsible for the employer Medicare tax for the whole year on all wages and tips. Irs forms 1040 File Form 941 or Form 944 to report withholding and employment taxes on tips. Irs forms 1040 Ordering rule. Irs forms 1040   If, by the 10th of the month after the month for which you received an employee's report on tips, you do not have enough employee funds available to deduct the employee tax, you no longer have to collect it. Irs forms 1040 If there are not enough funds available, withhold taxes in the following order. Irs forms 1040 Withhold on regular wages and other compensation. Irs forms 1040 Withhold social security and Medicare taxes on tips. Irs forms 1040 Withhold income tax on tips. Irs forms 1040 Reporting tips. Irs forms 1040   Report tips and any collected and uncollected social security and Medicare taxes on Form W-2 and on Form 941, lines 5b, 5c, and 5d (Form 944, lines 4b, 4c, and 4d). Irs forms 1040 Report an adjustment on Form 941, line 9 (Form 944, line 6), for the uncollected social security and Medicare taxes. Irs forms 1040 Enter the amount of uncollected social security tax and Medicare tax on Form W-2, box 12, with codes “A” and “B. Irs forms 1040 ” Do not include any uncollected Additional Medicare Tax in box 12 of Form W-2. Irs forms 1040 See section 13 and the General Instructions for Forms W-2 and W-3. Irs forms 1040   Revenue Ruling 2012-18 provides guidance for employers regarding social security and Medicare taxes imposed on tips, including information on the reporting of the employer share of social security and Medicare taxes under section 3121(q), the difference between tips and service charges, and the section 45B credit. Irs forms 1040 See Revenue Ruling 2012-18, 2012-26 I. Irs forms 1040 R. Irs forms 1040 B. Irs forms 1040 1032, available at www. Irs forms 1040 irs. Irs forms 1040 gov/irb/2012-26_IRB/ar07. Irs forms 1040 html. Irs forms 1040 Allocated tips. Irs forms 1040   If you operate a large food or beverage establishment, you must report allocated tips under certain circumstances. Irs forms 1040 However, do not withhold income, social security, or Medicare taxes on allocated tips. Irs forms 1040   A large food or beverage establishment is one that provides food or beverages for consumption on the premises, where tipping is customary, and where there were normally more than 10 employees on a typical business day during the preceding year. Irs forms 1040   The tips may be allocated by one of three methods—hours worked, gross receipts, or good faith agreement. Irs forms 1040 For information about these allocation methods, including the requirement to file Forms 8027 electronically if 250 or more forms are filed, see the Instructions for Form 8027. Irs forms 1040 For information on filing Form 8027 electronically with the IRS, see Publication 1239. Irs forms 1040 Tip Rate Determination and Education Program. Irs forms 1040   Employers may participate in the Tip Rate Determination and Education Program. Irs forms 1040 The program primarily consists of two voluntary agreements developed to improve tip income reporting by helping taxpayers to understand and meet their tip reporting responsibilities. Irs forms 1040 The two agreements are the Tip Rate Determination Agreement (TRDA) and the Tip Reporting Alternative Commitment (TRAC). Irs forms 1040 A tip agreement, the Gaming Industry Tip Compliance Agreement (GITCA), is available for the gaming (casino) industry. Irs forms 1040 To get more information about TRDA and TRAC agreements, see Publication 3144, Tips on Tips. Irs forms 1040 Additionally, visit IRS. Irs forms 1040 gov and enter “MSU tips” in the search box to get more information about GITCA, TRDA, or TRAC agreements. Irs forms 1040 7. Irs forms 1040 Supplemental Wages Supplemental wages are wage payments to an employee that are not regular wages. Irs forms 1040 They include, but are not limited to, bonuses, commissions, overtime pay, payments for accumulated sick leave, severance pay, awards, prizes, back pay, retroactive pay increases, and payments for nondeductible moving expenses. Irs forms 1040 Other payments subject to the supplemental wage rules include taxable fringe benefits and expense allowances paid under a nonaccountable plan. Irs forms 1040 How you withhold on supplemental wages depends on whether the supplemental payment is identified as a separate payment from regular wages. Irs forms 1040 See Regulations section 31. Irs forms 1040 3402(g)-1 for additional guidance for wages paid after January 1, 2007. Irs forms 1040 Also see Revenue Ruling 2008-29, 2008-24 I. Irs forms 1040 R. Irs forms 1040 B. Irs forms 1040 1149, available at www. Irs forms 1040 irs. Irs forms 1040 gov/irb/2008-24_IRB/ar08. Irs forms 1040 html. Irs forms 1040 Withholding on supplemental wages when an employee receives more than $1 million of supplemental wages from you during the calendar year. Irs forms 1040   Special rules apply to the extent supplemental wages paid to any one employee during the calendar year exceed $1 million. Irs forms 1040 If a supplemental wage payment, together with other supplemental wage payments made to the employee during the calendar year, exceeds $1 million, the excess is subject to withholding at 39. Irs forms 1040 6% (or the highest rate of income tax for the year). Irs forms 1040 Withhold using the 39. Irs forms 1040 6% rate without regard to the employee's Form W-4. Irs forms 1040 In determining supplemental wages paid to the employee during the year, include payments from all businesses under common control. Irs forms 1040 For more information, see Treasury Decision 9276, 2006-37 I. Irs forms 1040 R. Irs forms 1040 B. Irs forms 1040 423, available at www. Irs forms 1040 irs. Irs forms 1040 gov/irb/2006-37_IRB/ar09. Irs forms 1040 html. Irs forms 1040 Withholding on supplemental wage payments to an employee who does not receive $1 million of supplemental wages during the calendar year. Irs forms 1040   If the supplemental wages paid to the employee during the calendar year are less than or equal to $1 million, the following rules apply in determining the amount of income tax to be withheld. Irs forms 1040 Supplemental wages combined with regular wages. Irs forms 1040   If you pay supplemental wages with regular wages but do not specify the amount of each, withhold federal income tax as if the total were a single payment for a regular payroll period. Irs forms 1040 Supplemental wages identified separately from regular wages. Irs forms 1040   If you pay supplemental wages separately (or combine them in a single payment and specify the amount of each), the federal income tax withholding method depends partly on whether you withhold income tax from your employee's regular wages. Irs forms 1040 If you withheld income tax from an employee's regular wages in the current or immediately preceding calendar year, you can use one of the following methods for the supplemental wages. Irs forms 1040 Withhold a flat 25% (no other percentage allowed). Irs forms 1040 If the supplemental wages are paid concurrently with regular wages, add the supplemental wages to the concurrently paid regular wages. Irs forms 1040 If there are no concurrently paid regular wages, add the supplemental wages to alternatively, either the regular wages paid or to be paid for the current payroll period or the regular wages paid for the preceding payroll period. Irs forms 1040 Figure the income tax withholding as if the total of the regular wages and supplemental wages is a single payment. Irs forms 1040 Subtract the tax withheld from the regular wages. Irs forms 1040 Withhold the remaining tax from the supplemental wages. Irs forms 1040 If there were other payments of supplemental wages paid during the payroll period made before the current payment of supplemental wages, aggregate all the payments of supplemental wages paid during the payroll period with the regular wages paid during the payroll period, calculate the tax on the total, subtract the tax already withheld from the regular wages and the previous supplemental wage payments, and withhold the remaining tax. Irs forms 1040 If you did not withhold income tax from the employee's regular wages in the current or immediately preceding calendar year, use method 1-b. Irs forms 1040 This would occur, for example, when the value of the employee's withholding allowances claimed on Form W-4 is more than the wages. Irs forms 1040 Regardless of the method you use to withhold income tax on supplemental wages, they are subject to social security, Medicare, and FUTA taxes. Irs forms 1040 Example 1. Irs forms 1040 You pay John Peters a base salary on the 1st of each month. Irs forms 1040 He is single and claims one withholding allowance. Irs forms 1040 In January he is paid $1,000. Irs forms 1040 Using the wage bracket tables, you withhold $50 from this amount. Irs forms 1040 In February, he receives salary of $1,000 plus a commission of $2,000, which you combine with regular wages and do not separately identify. Irs forms 1040 You figure the withholding based on the total of $3,000. Irs forms 1040 The correct withholding from the tables is $338. Irs forms 1040 Example 2. Irs forms 1040 You pay Sharon Warren a base salary on the 1st of each month. Irs forms 1040 She is single and claims one allowance. Irs forms 1040 Her May 1 pay is $2,000. Irs forms 1040 Using the wage bracket tables, you withhold $188. Irs forms 1040 On May 14 she receives a bonus of $1,000. Irs forms 1040 Electing to use supplemental wage withholding method 1-b, you: Add the bonus amount to the amount of wages from the most recent base salary pay date (May 1) ($2,000 + $1,000 = $3,000). Irs forms 1040 Determine the amount of withholding on the combined $3,000 amount to be $338 using the wage bracket tables. Irs forms 1040 Subtract the amount withheld from wages on the most recent base salary pay date (May 1) from the combined withholding amount ($338 – $188 = $150). Irs forms 1040 Withhold $150 from the bonus payment. Irs forms 1040 Example 3. Irs forms 1040 The facts are the same as in Example 2, except you elect to use the flat rate method of withholding on the bonus. Irs forms 1040 You withhold 25% of $1,000, or $250, from Sharon's bonus payment. Irs forms 1040 Example 4. Irs forms 1040 The facts are the same as in Example 2, except you elect to pay Sharon a second bonus of $2,000 on May 28. Irs forms 1040 Using supplemental wage withholding method 1-b, you: Add the first and second bonus amounts to the amount of wages from the most recent base salary pay date (May 1) ($2,000 + $1,000 + $2,000 = $5,000). Irs forms 1040 Determine the amount of withholding on the combined $5,000 amount to be $781 using the wage bracket tables. Irs forms 1040 Subtract the amounts withheld from wages on the most recent base salary pay date (May 1) and the amounts withheld from the first bonus payment from the combined withholding amount ($781 – $188 – $150 = $443). Irs forms 1040 Withhold $443 from the second bonus payment. Irs forms 1040 Tips treated as supplemental wages. Irs forms 1040   Withhold income tax on tips from wages earned by the employee or from other funds the employee makes available. Irs forms 1040 If an employee receives regular wages and reports tips, figure income tax withholding as if the tips were supplemental wages. Irs forms 1040 If you have not withheld income tax from the regular wages, add the tips to the regular wages. Irs forms 1040 Then withhold income tax on the total. Irs forms 1040 If you withheld income tax from the regular wages, you can withhold on the tips by method 1-a or 1-b discussed earlier in this section under Supplemental wages identified separately from regular wages. Irs forms 1040 Vacation pay. Irs forms 1040   Vacation pay is subject to withholding as if it were a regular wage payment. Irs forms 1040 When vacation pay is in addition to regular wages for the vacation period, treat it as a supplemental wage payment. Irs forms 1040 If the vacation pay is for a time longer than your usual payroll period, spread it over the pay periods for which you pay it. Irs forms 1040 8. Irs forms 1040 Payroll Period Your payroll period is a period of service for which you usually pay wages. Irs forms 1040 When you have a regular payroll period, withhold income tax for that time period even if your employee does not work the full period. Irs forms 1040 No regular payroll period. Irs forms 1040   When you do not have a regular payroll period, withhold the tax as if you paid wages for a daily or miscellaneous payroll period. Irs forms 1040 Figure the number of days (including Sundays and holidays) in the period covered by the wage payment. Irs forms 1040 If the wages are unrelated to a specific length of time (for example, commissions paid on completion of a sale), count back the number of days from the payment period to the latest of: The last wage payment made during the same calendar year, The date employment began, if during the same calendar year, or January 1 of the same year. Irs forms 1040 Employee paid for period less than 1 week. Irs forms 1040   When you pay an employee for a period of less than one week, and the employee signs a statement under penalties of perjury indicating he or she is not working for any other employer during the same week for wages subject to withholding, figure withholding based on a weekly payroll period. Irs forms 1040 If the employee later begins to work for another employer for wages subject to withholding, the employee must notify you within 10 days. Irs forms 1040 You then figure withholding based on the daily or miscellaneous period. Irs forms 1040 9. Irs forms 1040 Withholding From Employees' Wages Income Tax Withholding Using Form W-4 to figure withholding. Irs forms 1040   To know how much federal income tax to withhold from employees' wages, you should have a Form W-4 on file for each employee. Irs forms 1040 Encourage your employees to file an updated Form W-4 for 2014, especially if they owed taxes or received a large refund when filing their 2013 tax return. Irs forms 1040 Advise your employees to use the IRS Withholding Calculator on the IRS website at www. Irs forms 1040 irs. Irs forms 1040 gov/individuals for help in determining how many withholding allowances to claim on their Forms W-4. Irs forms 1040   Ask all new employees to give you a signed Form W-4 when they start work. Irs forms 1040 Make the form effective with the first wage payment. Irs forms 1040 If a new employee does not give you a completed Form W-4, withhold income tax as if he or she is single, with no withholding allowances. Irs forms 1040 Form in Spanish. Irs forms 1040   You can provide Formulario W-4(SP), Certificado de Exención de Retenciones del Empleado, in place of Form W-4, to your Spanish-speaking employees. Irs forms 1040 For more information, see Publicación 17(SP), El Impuesto Federal sobre los Ingresos (Para Personas Físicas). Irs forms 1040 The rules discussed in this section that apply to Form W-4 also apply to Formulario W-4(SP). Irs forms 1040 Electronic system to receive Form W-4. Irs forms 1040   You may establish a system to electronically receive Forms W-4 from your employees. Irs forms 1040 See Regulations section 31. Irs forms 1040 3402(f)(5)-1(c) for more information. Irs forms 1040 Effective date of Form W-4. Irs forms 1040   A Form W-4 remains in effect until the employee gives you a new one. Irs forms 1040 When you receive a new Form W-4 from an employee, do not adjust withholding for pay periods before the effective date of the new form. Irs forms 1040 If an employee gives you a Form W-4 that replaces an existing Form W-4, begin withholding no later than the start of the first payroll period ending on or after the 30th day from the date when you received the replacement Form W-4. Irs forms 1040 For exceptions, see Exemption from federal income tax withholding , IRS review of requested Forms W-4 , and Invalid Forms W-4 , later in this section. Irs forms 1040 A Form W-4 that makes a change for the next calendar year will not take effect in the current calendar year. Irs forms 1040 Successor employer. Irs forms 1040   If you are a successor employer (see Successor employer , later in this section), secure new Forms W-4 from the transferred employees unless the “Alternative Procedure” in section 5 of Revenue Procedure 2004-53 applies. Irs forms 1040 See Revenue Procedure 2004-53, 2004-34 I. Irs forms 1040 R. Irs forms 1040 B. Irs forms 1040 320, available at www. Irs forms 1040 irs. Irs forms 1040 gov/irb/2004-34_IRB/ar13. Irs forms 1040 html. Irs forms 1040 Completing Form W-4. Irs forms 1040   The amount of any federal income tax withholding must be based on marital status and withholding allowances. Irs forms 1040 Your employees may not base their withholding amounts on a fixed dollar amount or percentage. Irs forms 1040 However, an employee may specify a dollar amount to be withheld in addition to the amount of withholding based on filing status and withholding allowances claimed on Form W-4. Irs forms 1040 Employees may claim fewer withholding allowances than they are entitled to claim. Irs forms 1040 They may wish to claim fewer allowances to ensure they have enough withholding or to offset the tax on other sources of taxable income not subject to withholding. Irs forms 1040 See Publication 505, Tax Withholding and Estimated Tax, for more information about completing Form W-4. Irs forms 1040 Along with Form W-4, you may wish to order Publication 505 for use by your employees. Irs forms 1040 Do not accept any withholding or estimated tax payments from your employees in addition to withholding based on their Form W-4. Irs forms 1040 If they require additional withholding, they should submit a new Form W-4 and, if necessary, pay estimated tax by filing Form 1040-ES, Estimated Tax for Individuals, or by using the Electronic Federal Tax Payment System (EFTPS) to make estimated tax payments. Irs forms 1040 Exemption from federal income tax withholding. Irs forms 1040   Generally, an employee may claim exemption from federal income tax withholding because he or she had no income tax liability last year and expects none this year. Irs forms 1040 See the Form W-4 instructions for more information. Irs forms 1040 However, the wages are still subject to social security and Medicare taxes. Irs forms 1040 See also Invalid Forms W-4 , later in this section. Irs forms 1040   A Form W-4 claiming exemption from withholding is effective when it is filed with the employer and only for that calendar year. Irs forms 1040 To continue to be exempt from withholding in the next calendar year, an employee must give you a new Form W-4 by February 15. Irs forms 1040 If the employee does not give you a new Form W-4 by February 15, begin withholding based on the last Form W-4 for the employee that did not claim an exemption from withholding or, if one was not filed, then withhold tax as if he or she is single with zero withholding allowances. Irs forms 1040 If the employee provides a new Form W-4 claiming exemption from withholding on February 16 or later, you may apply it to future wages but do not refund any taxes already withheld. Irs forms 1040 Withholding income taxes on the wages of nonresident alien employees. Irs forms 1040   In general, you must withhold federal income taxes on the wages of nonresident alien employees. Irs forms 1040 However, see Publication 515, Withholding of Tax on Nonresident Aliens and Foreign Entities, for exceptions to this general rule. Irs forms 1040 Also see section 3 of Publication 51 (Circular A), Agricultural Employer's Tax Guide, for guidance on H-2A visa workers. Irs forms 1040 Withholding adjustment for nonresident alien employees. Irs forms 1040   For 2014, apply the procedure discussed next to figure the amount of income tax to withhold from the wages of nonresident alien employees performing services within the United States. Irs forms 1040 Nonresident alien students from India and business apprentices from India are not subject to this procedure. Irs forms 1040 Instructions. Irs forms 1040   To figure how much income tax to withhold from the wages paid to a nonresident alien employee performing services in the United States, use the following steps. Irs forms 1040 Step 1. Irs forms 1040   Add to the wages paid to the nonresident alien employee for the payroll period the amount shown in the chart below for the applicable payroll period. Irs forms 1040    Amount to Add to Nonresident Alien Employee's Wages for Calculating Income Tax Withholding Only   Payroll Period Add Additional     Weekly $ 43. Irs forms 1040 30     Biweekly 86. Irs forms 1040 50     Semimonthly 93. Irs forms 1040 80     Monthly 187. Irs forms 1040 50     Quarterly 562. Irs forms 1040 50     Semiannually 1,125. Irs forms 1040 00     Annually 2,250. Irs forms 1040 00     Daily or Miscellaneous (each day of the payroll period) 8. Irs forms 1040 70   Step 2. Irs forms 1040   Use the amount figured in Step 1 and the number of withholding allowances claimed (generally limited to one allowance) to figure income tax withholding. Irs forms 1040 Determine the value of withholding allowances by multiplying the number of withholding allowances claimed by the appropriate amount from Table 5. Irs forms 1040 Percentage Method—2014 Amount for One Withholding Allowance shown on page 41. Irs forms 1040 If you are using the Percentage Method Tables for Income Tax Withholding, provided on pages 43–44, reduce the amount figured in Step 1 by the value of withholding allowances and use that reduced amount to figure the income tax withholding. Irs forms 1040 If you are using the Wage Bracket Method for Income Tax Withholding, provided on pages 45–64, use the amount figured in Step 1 and the number of withholding allowances to figure income tax withholding. Irs forms 1040 The amounts from the chart above are added to wages solely for calculating income tax withholding on the wages of the nonresident alien employee. Irs forms 1040 The amounts from the chart should not be included in any box on the employee's Form W-2 and do not increase the income tax liability of the employee. Irs forms 1040 Also, the amounts from the chart do not increase the social security tax or Medicare tax liability of the employer or the employee, or the FUTA tax liability of the employer. Irs forms 1040 This procedure only applies to nonresident alien employees who have wages subject to income tax withholding. Irs forms 1040 Example. Irs forms 1040 An employer using the percentage method of withholding pays wages of $500 for a biweekly payroll period to a married nonresident alien employee. Irs forms 1040 The nonresident alien has properly completed Form W-4, entering marital status as “single” with one withholding allowance and indicating status as a nonresident alien on Form W-4, line 6 (see Nonresident alien employee's Form W-4 , later in this section). Irs forms 1040 The employer determines the wages to be used in the withholding tables by adding to the $500 amount of wages paid the amount of $86. Irs forms 1040 50 from the chart under Step 1 ($586. Irs forms 1040 50 total). Irs forms 1040 The employer then applies the applicable tables to determine the income tax withholding for nonresident aliens (see Step 2 ). Irs forms 1040 Reminder: If you use the Percentage Method Tables for Income Tax Withholding, reduce the amount figured in Step 1 by the value of withholding allowances and use that reduced amount to figure income tax withholding. Irs forms 1040 The $86. Irs forms 1040 50 added to wages for calculating income tax withholding is not reported on Form W-2, and does not increase the income tax liability of the employee. Irs forms 1040 Also, the $86. Irs forms 1040 50 added to wages does not affect the social security tax or Medicare tax liability of the employer or the employee, or the FUTA tax liability of the employer. Irs forms 1040 Supplemental wage payment. Irs forms 1040   This procedure for determining the amount of income tax withholding does not apply to a supplemental wage payment (see section 7) if the 39. Irs forms 1040 6% mandatory flat rate withholding applies or if the 25% optional flat rate withholding is being used to calculate income tax withholding on the supplemental wage payment. Irs forms 1040 Nonresident alien employee's Form W-4. Irs forms 1040   When completing Forms W-4, nonresident aliens are required to: Not claim exemption from income tax withholding, Request withholding as if they are single, regardless of their actual marital status, Claim only one allowance (if the nonresident alien is a resident of Canada, Mexico, or South Korea, or a student or business apprentice from India, he or she may claim more than one allowance), and Write “Nonresident Alien” or “NRA” above the dotted line on line 6 of Form W-4. Irs forms 1040   If you maintain an electronic Form W-4 system, you should provide a field for nonresident aliens to enter nonresident alien status in lieu of writing “Nonresident Alien” or “NRA” above the dotted line on line 6. Irs forms 1040 A nonresident alien employee may request additional withholding at his or her option for other purposes, although such additions should not be necessary for withholding to cover federal income tax liability related to employment. Irs forms 1040 Form 8233. Irs forms 1040   If a nonresident alien employee claims a tax treaty exemption from withholding, the employee must submit Form 8233, Exemption From Withholding on Compensation for Independent (and Certain Dependent) Personal Services of a Nonresident Alien Individual, with respect to the income exempt under the treaty, instead of Form W-4. Irs forms 1040 See Publication 515 for details. Irs forms 1040 IRS review of requested Forms W-4. Irs forms 1040   When requested by the IRS, you must make original Forms W-4 available for inspection by an IRS employee. Irs forms 1040 You may also be directed to send certain Forms W-4 to the IRS. Irs forms 1040 You may receive a notice from the IRS requiring you to submit a copy of Form W-4 for one or more of your named employees. Irs forms 1040 Send the requested copy or copies of Form W-4 to the IRS at the address provided and in the manner directed by the notice. Irs forms 1040 The IRS may also require you to submit copies of Form W-4 to the IRS as directed by Treasury Decision 9337, 2007-35 I. Irs forms 1040 R. Irs forms 1040 B. Irs forms 1040 455, which is available at www. Irs forms 1040 irs. Irs forms 1040 gov/irb/2007-35_IRB/ar10. Irs forms 1040 html. Irs forms 1040 When we refer to Form W-4, the same rules apply to Formulario W-4(SP), its Spanish translation. Irs forms 1040 After submitting a copy of a requested Form W-4 to the IRS, continue to withhold federal income tax based on that Form W-4 if it is valid (see Invalid Forms W-4 , later in this section). Irs forms 1040 However, if the IRS later notifies you in writing the employee is not entitled to claim exemption from withholding or a claimed number of withholding allowances, withhold federal income tax based on the effective date, marital status, and maximum number of withholding allowances specified in the IRS notice (commonly referred to as a "lock-in letter
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IRS Offers Health Care Tax Tips to Help Individuals Understand Tax Provisions in the Affordable Care Act

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IR-2014-19, Feb. 25, 2014

The Internal Revenue Service is offering educational Health Care Tax Tips to help individuals understand how the Affordable Care Act may affect their taxes. 

The IRS has designed the Health Care Tax Tips to help people understand what they need to know for the federal individual income tax returns they are filing this year, as well as for future tax returns. This includes information on the Premium Tax Credit and making health care coverage choices.

Although many of the tax provisions included in the law went into effect on Jan. 1, 2014, most do not affect the 2013 tax returns. 

The Health Care Tax Tips, which are now available at IRS.gov/aca, include:

    • IRS Reminds Individuals of Health Care Choices for 2014 — Find out what you need to know about how health care choices you make for 2014 may affect your taxes.
    • The Health Insurance Marketplace – Learn about Your Health Insurance Coverage Options Find out about getting health care coverage through the Health Insurance Marketplace.
    • The Premium Tax Credit — Learn the basics of the Premium Tax Credit, including who might be eligible and how to get the credit.
    • The Individual Shared Responsibility Payment – An Overview — Provides information about types of qualifying coverage, exemptions from having coverage, and making a payment if you do not have qualifying coverage or an exemption.
    • Three Timely Tips about Taxes and the Health Care Law —  Provides tips that help with filing the 2013 tax return, including information about employment status, tax favored health plans and itemized deductions.
    • Four Tax Facts about the Health Care Law for Individuals — Offers basic tips to help people determine if the Affordable Care Act affects them and their families, and where to find more information.
    • Changes in Circumstances can Affect your Premium Tax Credit — Learn the importance of reporting any changes in circumstances that involve family size or income when advance payments of the Premium Tax Credit are involved.

In addition to Health Care Tax Tips, the IRS.gov/aca website offers informative flyers and brochures, Frequently Asked Questions and in-depth legal guidance regarding the tax provisions of the Affordable Care Act.   

Individuals interested in receiving copies of IRS tax tips via email on a variety of topics, including the Affordable Care Act, can subscribe at www.irs.gov/uac/Subscribe-to-IRS-Tax-Tips.

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Page Last Reviewed or Updated: 12-Mar-2014

The Irs Forms 1040

Irs forms 1040 Internal Revenue Bulletin:  2009-36  September 8, 2009  Rev. Irs forms 1040 Proc. Irs forms 1040 2009-37 Table of Contents SECTION 1. Irs forms 1040 PURPOSE SECTION 2. Irs forms 1040 BACKGROUND SECTION 3. Irs forms 1040 SCOPE SECTION 4. Irs forms 1040 ELECTION PROCEDURES SECTION 5. Irs forms 1040 REQUIRED INFORMATION STATEMENT SECTION 6. Irs forms 1040 EFFECTIVE DATE SECTION 7. Irs forms 1040 TRANSITION RULE SECTION 8. Irs forms 1040 PAPERWORK REDUCTION ACT DRAFTING INFORMATION SECTION 1. Irs forms 1040 PURPOSE . Irs forms 1040 01 This revenue procedure provides the exclusive procedures for taxpayers to make an election to defer recognizing discharge of indebtedness income (“COD income”) under § 108(i) of the Internal Revenue Code. Irs forms 1040 . Irs forms 1040 02 This revenue procedure also requires taxpayers making the § 108(i) election to provide additional information on returns beginning with the taxable year following the taxable year for which the taxpayer makes the election. Irs forms 1040 This revenue procedure describes the time and manner of providing this additional information. Irs forms 1040 . Irs forms 1040 03 The Internal Revenue Service and Treasury Department intend to issue additional guidance under § 108(i) that may include regulations addressing matters in this revenue procedure. Irs forms 1040 Taxpayers should be aware that these regulations may be retroactive. Irs forms 1040 See § 7805(b)(2). Irs forms 1040 This revenue procedure may be modified to provide procedures consistent with additional guidance. Irs forms 1040 SECTION 2. Irs forms 1040 BACKGROUND . Irs forms 1040 01 Section 108(i), Generally. Irs forms 1040 Section 108(i) was added to the Code by § 1231 of the American Recovery and Reinvestment Tax Act of 2009, Pub. Irs forms 1040 L. Irs forms 1040 No. Irs forms 1040 111-5, 123 Stat. Irs forms 1040 338. Irs forms 1040 In general, § 108(i) provides that, at the election of a taxpayer, COD income realized in connection with a reacquisition after December 31, 2008, and before January 1, 2011, of an applicable debt instrument is includible in gross income ratably over a 5-taxable-year inclusion period, beginning with the taxpayer’s fourth or fifth taxable year following the taxable year of the reacquisition. Irs forms 1040 Generally, if a taxpayer makes a § 108(i) election and reacquires (or is treated as reacquiring) the applicable debt instrument generating the COD income for a new debt instrument with original issue discount (“OID”), then interest deductions for this OID also are deferred, as provided in § 108(i)(2). Irs forms 1040 The OID deferral rule, however, does not apply if the amount of OID is less than a de minimis amount, as determined under § 1273(a)(3) and § 1. Irs forms 1040 1273-1(d) of the Income Tax Regulations. Irs forms 1040 The OID deferral rule in § 108(i)(2) applies at the entity level for a pass-through entity. Irs forms 1040 For example, a partnership (and therefore its partners) may not deduct currently the OID described in § 108(i)(2)(A)(i). Irs forms 1040 A taxpayer must take into account any item of income or deduction deferred under § 108(i), and not previously taken into account, in the taxable year in which certain events occur (such as the liquidation of the taxpayer and upon other events specified in administrative guidance). Irs forms 1040 See § 108(i)(5)(D). Irs forms 1040 The rule regarding acceleration of deferred COD income and OID deductions also applies in the case of certain dispositions by persons holding ownership interests in pass-through entities. Irs forms 1040 Section 108(i)(5)(D)(ii). Irs forms 1040 For purposes of § 108(i), regulated investment companies (as defined in § 851(a)) and real estate investment trusts (as defined in § 856(a)) are not pass-through entities. Irs forms 1040 . Irs forms 1040 02 Applicable Debt Instrument. Irs forms 1040 Section 108(i)(3)(A) defines the term “applicable debt instrument” to mean any debt instrument issued by a C corporation or by any other person in connection with the conduct of a trade or business by that person. Irs forms 1040 The term “debt instrument” means any bond, debenture, note, certificate, or any other instrument or contractual arrangement constituting indebtedness within the meaning of § 1275(a)(1). Irs forms 1040 Section 108(i)(3)(B). Irs forms 1040 For purposes of § 108(i), in the case of an intercompany obligation (as defined in § 1. Irs forms 1040 1502-13(g)(2)(ii)), an applicable debt instrument includes only an instrument for which COD income is realized upon the instrument’s deemed satisfaction under § 1. Irs forms 1040 1502-13(g)(5). Irs forms 1040 . Irs forms 1040 03 Reacquisition. Irs forms 1040 Section 108(i)(4)(A) defines the term “reacquisition” to mean, with respect to any applicable debt instrument, any acquisition of the debt instrument by the debtor that issued (or is otherwise the obligor under) the debt instrument, or a person related to the debtor under § 108(e)(4). Irs forms 1040 The term “acquisition” includes an acquisition of the debt instrument for cash or other property, the exchange of the debt instrument for another debt instrument (including an exchange resulting from a modification of the debt instrument), the exchange of the debt instrument for corporate stock or a partnership interest, the contribution of the debt instrument to capital, and the complete forgiveness of the indebtedness by the holder of the debt instrument. Irs forms 1040 See § 108(i)(4)(B). Irs forms 1040 The term “acquisition” also includes an indirect acquisition within the meaning of § 1. Irs forms 1040 108-2(c) if a direct acquisition of the debt instrument would qualify for an election under § 108(i). Irs forms 1040 For example, if a corporation acquires debt of a partnership that the partnership issued in connection with its trade or business, and the partnership and corporation become related within six months of the corporation’s acquisition of the debt, the indirect acquisition is an acquisition for which an election under § 108(i) may be made. Irs forms 1040 . Irs forms 1040 04 General Requirements for the Section 108(i) Election. Irs forms 1040 Section 108(i)(5)(B) provides, in general, that a taxpayer makes the § 108(i) election by including a statement that clearly identifies the applicable debt instrument with the return of tax imposed for the taxable year in which the reacquisition of the instrument occurs. Irs forms 1040 (For purposes of this revenue procedure, a return of tax or income tax return includes an information return, and a taxpayer includes a person that files an information return. Irs forms 1040 ) The statement must include the amount of income to which § 108(i)(1) applies and other information the Service may prescribe. Irs forms 1040 Once made, a § 108(i) election is irrevocable and, except as provided in section 7 of this revenue procedure, may not be modified. Irs forms 1040 . Irs forms 1040 05 Section 108(i) Elections Made by Pass-through Entities. Irs forms 1040 In the case of COD income realized by a pass-through entity from the reacquisition of an applicable debt instrument, the pass-through entity makes the § 108(i) election. Irs forms 1040 Section 108(i)(5)(B)(iii). Irs forms 1040 . Irs forms 1040 06 Additional Information on Subsequent Years’ Returns. Irs forms 1040 Section 108(i)(7) authorizes the Service to issue guidance necessary or appropriate for applying § 108(i), including requiring reporting the election and other information on returns of tax for subsequent taxable years. Irs forms 1040 . Irs forms 1040 07 Exclusivity. Irs forms 1040 Section 108(i)(5)(C) provides that if a taxpayer elects to apply § 108(i) to an applicable debt instrument, § 108(a)(1)(A), (B), (C), and (D) do not apply to COD income deferred under § 108(i). Irs forms 1040 . Irs forms 1040 08 Allocation of Deferred COD Income on Partnership Indebtedness. Irs forms 1040 Section 4. Irs forms 1040 04(3) of this revenue procedure describes how a partnership may elect under § 108(i) to defer a portion of the COD income realized from the reacquisition of an applicable debt instrument. Irs forms 1040 If a partnership elects to defer all or any portion of COD income realized from the reacquisition of an applicable debt instrument, all of the COD income with respect to that debt instrument, without regard to § 108(i), is allocated to the partners in the partnership immediately before the reacquisition in the manner in which the income would be included in the distributive shares of these partners under § 704 and the regulations thereunder, including § 1. Irs forms 1040 704-1(b)(2)(iii). Irs forms 1040 Each partner’s share of this COD income is the partner’s COD income amount (“COD income amount”). Irs forms 1040 The partner’s COD income amount that is deferred under § 108(i) is the partner’s deferred amount (“deferred amount”). Irs forms 1040 The partner’s COD income amount that is not deferred and is included in the partner’s distributive share of partnership income for the taxable year of the partnership in which the reacquisition occurs is the partner’s included amount (“included amount”). Irs forms 1040 . Irs forms 1040 09 Partner’s Deferred § 752 Amount. Irs forms 1040 A decrease in a partner’s share of a partnership liability resulting from the reacquisition of an applicable debt instrument that is not treated as a current distribution of money to the partner under § 752 by reason of § 108(i)(6) is the partner’s deferred § 752 amount (“deferred § 752 amount”). Irs forms 1040 A partner’s deferred § 752 amount may not exceed the lesser of (i) the partner’s deferred amount or (ii) gain that the partner would recognize in the year of reacquisition under § 731 as a result of the reacquisition absent § 108(i)(6). Irs forms 1040 To determine the amount of gain the partner would recognize under clause (ii) of the preceding sentence, the amount of any deemed distribution of money under § 752(b) resulting from the decrease in the partner’s share of a reacquired applicable debt instrument that is treated as an advance or draw of money under § 1. Irs forms 1040 731-1(a)(1)(ii) is determined as if no COD income resulting from the reacquisition of the applicable debt instrument is deferred under § 108(i). Irs forms 1040 See Rev. Irs forms 1040 Rul. Irs forms 1040 92-97, 1992-2 C. Irs forms 1040 B. Irs forms 1040 124, and Rev. Irs forms 1040 Rul. Irs forms 1040 94-4, 1994-1 C. Irs forms 1040 B. Irs forms 1040 195. Irs forms 1040 A partner’s deferred § 752 amount is treated as a distribution of money to the partner under § 752 at the same time, and to the extent remaining in the same amount, as the partner recognizes the COD income deferred under § 108(i). Irs forms 1040 . Irs forms 1040 10 Allocation of Deferred COD Income on S Corporation Indebtedness. Irs forms 1040 For purposes of § 108(i), an S corporation’s COD income deferred under § 108(i) is shared pro rata only among those shareholders that are shareholders of the S corporation immediately before the reacquisition transaction. Irs forms 1040 . Irs forms 1040 11 Deferred COD Income, Earnings and Profits, and Alternative Minimum Taxable Income. Irs forms 1040 (1) In general. Irs forms 1040 The Service and Treasury Department intend to issue regulations regarding the computation of a corporation’s earnings and profits with respect to COD income and OID deductions that are deferred under § 108(i). Irs forms 1040 These regulations generally will provide that deferred COD income increases earnings and profits in the taxable year that it is realized and not in the taxable year or years that the deferred COD income is includible in gross income. Irs forms 1040 OID deductions deferred under § 108(i) generally will decrease earnings and profits in the taxable year or years in which the deduction would be allowed without regard to § 108(i). Irs forms 1040 COD income and OID deductions that are deferred increase or decrease adjusted current earnings under § 56(g)(4) in the taxable year or years that the income or deduction is includible or deductible in determining taxable income. Irs forms 1040 See § 1. Irs forms 1040 56(g)-1(c)(1). Irs forms 1040 (2) Exceptions for certain special status corporations. Irs forms 1040 The Service and Treasury Department intend to issue regulations providing that in the case of regulated investment companies and real estate investment trusts, COD income deferred under § 108(i) generally increases earnings and profits in the taxable year or years in which the deferred COD income is includible in gross income and not in the year that the deferred COD income is realized. Irs forms 1040 OID deductions deferred under § 108(i) generally decrease earnings and profits in the taxable year or years that the deferred OID deductions are deductible. Irs forms 1040 . Irs forms 1040 12 Extension of Time to Make Election. Irs forms 1040 Under § 301. Irs forms 1040 9100-1 of the Procedure and Administration Regulations, the Service may grant an extension of time to make a regulatory election. Irs forms 1040 An election is a regulatory election if the due date is prescribed by regulation or other published guidance of general applicability. Irs forms 1040 Section 301. Irs forms 1040 9100-2(a) provides an automatic 12-month extension from the due date for making certain regulatory elections. Irs forms 1040 SECTION 3. Irs forms 1040 SCOPE This revenue procedure applies to taxpayers that realize COD income from a reacquisition after December 31, 2008, and before January 1, 2011, of an applicable debt instrument, as provided in § 108(i). Irs forms 1040 SECTION 4. Irs forms 1040 ELECTION PROCEDURES . Irs forms 1040 01 In General. Irs forms 1040 (1) A taxpayer within the scope of this revenue procedure makes the § 108(i) election by— (a) Attaching a statement meeting the requirements of section 4. Irs forms 1040 05 of this revenue procedure to the taxpayer’s timely filed (including extensions) original federal income tax return for the taxable year in which the reacquisition of the applicable debt instrument occurs, and (b) If applicable, satisfying the additional requirements of section 4. Irs forms 1040 07, 4. Irs forms 1040 08, 4. Irs forms 1040 09, or 4. Irs forms 1040 10 of this revenue procedure. Irs forms 1040 (2) The Service grants an automatic extension of 12 months from the due date prescribed in section 4. Irs forms 1040 01(1)(a) of this revenue procedure for making the § 108(i) election. Irs forms 1040 The rules that apply to an automatic extension under § 301. Irs forms 1040 9100-2(a) apply to this automatic extension. Irs forms 1040 . Irs forms 1040 02 Section 108(i) Elections Made by Members of Consolidated Groups. Irs forms 1040 The common parent of a consolidated group makes the § 108(i) election on behalf of all members of the group. Irs forms 1040 See § 1. Irs forms 1040 1502-77(a). Irs forms 1040 . Irs forms 1040 03 Aggregation Rule. Irs forms 1040 A taxpayer within the scope of this revenue procedure may treat two or more applicable debt instruments that are part of the same issue and that are reacquired during the same taxable year as one applicable debt instrument for purposes of this revenue procedure. Irs forms 1040 A pass-through entity may not treat two or more applicable debt instruments as one applicable debt instrument under this section 4. Irs forms 1040 03 if the owners and their ownership interests in the pass-through entity immediately prior to the reacquisition of each applicable debt instrument are not identical. Irs forms 1040 . Irs forms 1040 04 Partial Elections. Irs forms 1040 (1) A taxpayer within the scope of this revenue procedure may make an election for any portion of COD income realized from the reacquisition of any applicable debt instrument. Irs forms 1040 Thus, for example, if a taxpayer realizes $100 of COD income from the reacquisition of an applicable debt instrument, the taxpayer may elect under § 108(i)(1) to defer only $40 of the $100 of COD income. Irs forms 1040 The taxpayer may exclude from income the portion of COD income that the taxpayer does not elect to defer under § 108(i) ($60 in this example) under § 108(a)(1)(A), (B), (C), or (D), if applicable. Irs forms 1040 (2) A taxpayer is not required to make an election for the same portion of COD income arising from each applicable debt instrument that it reacquires, but may make an election for different portions of COD income arising from different applicable debt instruments (whether or not part of the same issue). Irs forms 1040 Thus, for example, if a taxpayer realizes $100 of COD income from the reacquisition of an applicable debt instrument (Instrument A) and $100 of COD income from the reacquisition of a different applicable debt instrument (Instrument B), the taxpayer may elect to defer all or a portion of the COD income associated with Instrument A and none or a different portion of the COD income associated with Instrument B. Irs forms 1040 (3) A partnership that elects to defer less than all of the COD income realized from the reacquisition of an applicable debt instrument may determine, in any manner, the portion, if any, of a partner’s COD income amount that is the partner’s deferred amount and the portion, if any, of a partner’s COD income amount that is the partner’s included amount. Irs forms 1040 Thus, for example, one partner’s deferred amount may be zero while another partner’s deferred amount may equal that partner’s COD income amount (or any portion thereof). Irs forms 1040 A partner may exclude from income the partner’s included amount under § 108(a)(1)(A), (B), (C), or (D), if applicable. Irs forms 1040 The provisions of this section 4. Irs forms 1040 04(3) apply for purposes of § 108(i) only and are not intended as an interpretation of or a change to existing law under § 704. Irs forms 1040 . Irs forms 1040 05 Contents of Election Statement. Irs forms 1040 A statement meets the requirements of this section 4. Irs forms 1040 05 if the statement— (1) Label. Irs forms 1040 States “Section 108(i) Election” across the top. Irs forms 1040 (2) Required information. Irs forms 1040 Provides, for each applicable debt instrument the reacquisition of which generates COD income that the taxpayer is electing to defer under § 108(i)— (a) The name and taxpayer identification numbers, if any, of the issuer or issuers of the applicable debt instrument; (b) A general description of the applicable debt instrument (including the issue and maturity dates) and, in the case of any person other than a C corporation, a general description of the person’s trade or business to which the applicable debt instrument is connected; (c) A general description of the reacquisition transaction or transactions generating the COD income (including the date(s) of the transaction(s)); (d) The total amount of COD income for the applicable debt instrument that results from the reacquisition (in the case of a partnership, the aggregate of the partners’ COD income amounts) and a general description of the manner in which this amount is calculated; (e) The amount of COD income for the applicable debt instrument that the taxpayer is electing to defer under § 108(i); (f) In the case of a partnership, a list of partners that have a deferred amount, their identifying information and each partner’s deferred amount; and in the case of an S corporation, a list of shareholders with COD income deferred under § 108(i), their identifying information and each shareholder’s share of the S corporation’s deferred COD income; and (g) In cases in which a new debt instrument is issued or deemed issued in exchange for the applicable debt instrument (including exchanges under § 108(e)(4), § 108(i)(2)(B), and § 1. Irs forms 1040 1001-3), the issuer’s name, the issuer’s taxpayer identification number, if any, a general description of the new debt instrument and whether the new debt instrument has OID, and if the new debt instrument has OID, a schedule of the OID that the issuer expects to accrue each taxable year on the instrument and the amount of OID that the issuer expects to defer under § 108(i)(2) each taxable year. Irs forms 1040 . Irs forms 1040 06 Supplemental information. Irs forms 1040 The statement described in section 4. Irs forms 1040 05 of this revenue procedure may specify for each applicable debt instrument an amount greater than the amount identified in section 4. Irs forms 1040 05(2)(e) of this revenue procedure that the taxpayer elects to defer under § 108(i) in the event the Service subsequently concludes that the taxpayer understated the amount of COD income described in section 4. Irs forms 1040 05(2)(d) of this revenue procedure. Irs forms 1040 This additional amount of COD income the taxpayer elects to defer may be described as the entire additional COD income, or as a percentage of any additional COD income. Irs forms 1040 If the taxpayer is a partnership, the partnership must specify each partner’s share of the partnership’s additional COD income that would be deferred (the partner’s additional deferred amount), which the partnership may describe for each partner as the partner’s entire share of the partnership’s additional COD income or as a percentage of the partner’s share of the partnership’s additional COD income. Irs forms 1040 If the taxpayer is an S corporation, the S corporation must specify each shareholder’s share of the S corporation’s additional COD income that would be deferred, which the S corporation may describe for each shareholder as the shareholder’s entire share of the S corporation’s additional COD income or as a percentage of the shareholder’s share of the S corporation’s additional COD income. Irs forms 1040 In the case of partnerships and S corporations, the additional COD income and the portion of additional COD income that would be deferred are allocated or determined as provided in sections 2. Irs forms 1040 08, 2. Irs forms 1040 10 and, if applicable, 4. Irs forms 1040 04(3) of this revenue procedure, respectively, as if the additional COD income was realized. Irs forms 1040 . Irs forms 1040 07 Additional Requirements for Certain Partnerships Making a § 108(i) Election. Irs forms 1040 The rules of this section 4. Irs forms 1040 07 apply to partnerships other than partnerships described in section 4. Irs forms 1040 10 of this revenue procedure. Irs forms 1040 (1) Information filing on Schedule K-1 (Form 1065 and Form 1065-B). Irs forms 1040 For the taxable year in which the § 108(i) election is made, the partnership must report on the Schedule K-1 (Form 1065 or Form 1065-B), Partner’s Share of Income, Deductions, Credits, etc. Irs forms 1040 , in the manner specified in the instructions to the forms, for each partner § 108(i) information on an aggregate basis for all applicable debt instruments for which a § 108(i) election is made. Irs forms 1040 Partnerships reporting § 108(i) information on the 2008 Schedule K-1 (Form 1065 or Form 1065-B) must report for each partner on an aggregate basis for all applicable debt instruments for which a § 108(i) election is made: (a) The partner’s deferred amount that the partner must include in income in the current taxable year under § 108(i)(1) or § 108(i)(5)(D)(i) or (ii), in box 11 (“other income”) using code F for Schedule K-1 (Form 1065) or in box 9 (“other”) using code U for Schedule K-1 (Form 1065-B); (b) The partner’s share of the partnership’s OID deduction deferred under § 108(i)(2)(A)(i) that is allowable as a deduction in the current taxable year under § 108(i)(2)(A)(ii) or § 108(i)(5)(D)(i) or (ii), in box 13 (“other deductions”) using code W for Schedule K-1 (Form 1065) or in box 9 (“other”) using code U for Schedule K-1 (Form 1065-B); (c) The partner’s deferred amount that has not been included in income in the current or prior taxable years, in box 20 (“other information”) using code X for Schedule K-1 (Form 1065) or in box 9 (“other”) using code U for Schedule K-1 (Form 1065-B); (d) The partner’s share of the partnership’s OID deduction deferred under § 108(i)(2)(A)(i) that has not been deducted in the current or prior taxable years, in box 20 (“other information”) using code X for Schedule K-1 (Form 1065) or in box 9 (“other”) using code U for Schedule K-1 (Form 1065-B); (e) The partner’s deferred § 752 amount that is treated as a distribution of money to the partner under § 752 in the current taxable year, in box 20 (“other information”) using code X for Schedule K-1 (Form 1065) or in box 9 (“other”) using code U for Schedule K-1 (Form 1065-B); and (f) The partner’s deferred § 752 amount remaining as of the end of the current taxable year, in box 20 (“other information”) using code X for Schedule K-1 (Form 1065) or in box 9 (“other”) using code U for Schedule K-1 (Form 1065-B). Irs forms 1040 (2) Election information statement provided to partners. Irs forms 1040 The partnership must attach to the Schedule K-1 (Form 1065 or Form 1065-B) provided to each partner for the taxable year in which the § 108(i) election is made a statement satisfying the requirements of this section 4. Irs forms 1040 07(2). Irs forms 1040 The partnership should not attach these statements to the Schedules K-1 that are filed with the Service, but must retain these statements, and each partner must retain that partner’s statement, in their respective books and records. Irs forms 1040 A statement meets the requirements of this section 4. Irs forms 1040 07(2) if the statement— (a) Label. Irs forms 1040 States “Section 108(i) Election Information Statement for Partners” across the top. Irs forms 1040 (b) Required information. Irs forms 1040 Clearly identifies for each applicable debt instrument to which an election under § 108(i) applies— (i) The partner’s COD income amount, the partner’s deferred amount, and the partner’s included amount; (ii) The partner’s deferred amount that the partner must include in income in the current taxable year under § 108(i)(5)(D)(i) or (ii); (iii) The partner’s share of the partnership’s OID deduction deferred under § 108(i)(2)(A)(i) in the current taxable year; (iv) The partner’s share of the partnership’s OID deduction deferred under § 108(i)(2)(A)(i) that is allowable as a deduction in the current taxable year under § 108(i)(5)(D)(i) or (ii); (v) The partner’s share of each liability of the partnership described in section 4. Irs forms 1040 05(2)(g) of this revenue procedure; (vi) The partner’s share of the decrease in the partnership liability that results from the reacquisition of the applicable debt instrument; (vii) The partner’s share of the decrease in the partnership liability that results from the reacquisition of the applicable debt instrument that is treated as a distribution of money to the partner under § 752 in the current taxable year; (viii) The partner’s deferred § 752 amount as described in section 2. Irs forms 1040 09 of this revenue procedure; (ix) The partner’s additional deferred amount as described in section 4. Irs forms 1040 06 of this revenue procedure; and (x) The date of the reacquisition transaction generating the COD income. Irs forms 1040 (c) If a partner fails to provide the written statement required by section 4. Irs forms 1040 07(3) of this revenue procedure, the partnership must indicate that the amounts described in section 4. Irs forms 1040 07(2)(b)(vii) and (viii) of this revenue procedure cannot be calculated because the partner did not provide the information necessary to report these amounts. Irs forms 1040 (3) Partner reporting requirements. Irs forms 1040 The partnership must make reasonable efforts prior to making a § 108(i) election to secure from each partner with a deferred amount for which it does not have the information necessary to compute the partner’s basis in its partnership interest (and its deferred § 752 amount as described in section 2. Irs forms 1040 09 of this revenue procedure) a written statement signed under penalties of perjury that includes this information. Irs forms 1040 Each partner with a deferred amount must provide this written statement to the partnership within 30 days of the date of request by the partnership. Irs forms 1040 A partner’s failure to comply with this reporting requirement does not invalidate the partnership’s election under § 108(i) for an applicable debt instrument only if the partnership makes reasonable efforts before making the § 108(i) election to obtain the written statement from the partner and otherwise complies with the requirements of section 4 of this revenue procedure. Irs forms 1040 If a partner provides its written statement under this section 4. Irs forms 1040 07(3) after the partnership has provided to the partner the Section 108(i) Election Information Statement for Partners, the partnership must provide to the partner a revised Section 108(i) Election Information Statement for Partners reporting the information required under section 4. Irs forms 1040 07(2)(b)(vii) and (viii) of this revenue procedure and report the partner’s deferred § 752 amount on the partner’s Schedule K-1 (Form 1065 or Form 1065-B) in subsequent taxable years. Irs forms 1040 . Irs forms 1040 08 Additional Requirements for an S Corporation Making a § 108(i) Election. Irs forms 1040 (1) Information filing on Schedule K-1 (Form 1120S). Irs forms 1040 For the taxable year in which the § 108(i) election is made, the S corporation must report on the Schedule K-1 (Form 1120S), Shareholder’s Share of Income, Deductions, Credits, etc. Irs forms 1040 , in the manner specified in the instructions to the forms, for each shareholder § 108(i) information on an aggregate basis for all applicable debt instruments for which a § 108(i) election is made. Irs forms 1040 S corporations reporting § 108(i) information on the 2008 Schedule K-1 (Form 1120S) must report for each shareholder, on an aggregate basis for all applicable debt instruments for which a § 108(i) election is made, the shareholder’s share of the S corporation’s: (a) COD income deferred under § 108(i) that the shareholder must include in income in the current taxable year under § 108(i)(1) or § 108(i)(5)(D)(i) or (ii), in box 10 (“other income”) using code E; (b) OID deduction deferred under § 108(i)(2)(A)(i) that is allowable as a deduction in the current taxable year under § 108(i)(2)(A)(ii), or § 108(i)(5)(D)(i) or (ii), in box 12 (“other deductions”) using code S; (c) COD income deferred under § 108(i) that has not been included in income in the current or prior taxable years, in box 17 (“other information”) using code T; and (d) OID deduction deferred under § 108(i)(2)(A)(i) that has not been deducted in the current or prior taxable years, in box 17 (“other information”) using code T. Irs forms 1040 (2) Election information statement provided to shareholders. Irs forms 1040 The S corporation must attach to the Schedule K-1 (Form 1120S) provided to each shareholder for the taxable year in which the § 108(i) election is made, a statement satisfying the requirements of this section 4. Irs forms 1040 08(2). Irs forms 1040 The S corporation should not attach these statements to the Schedules K-1 that are filed with the Service, but must retain these statements, and each shareholder must retain that shareholder’s statement, in their respective books and records. Irs forms 1040 A statement meets the requirements of this section 4. Irs forms 1040 08(2) if the statement— (a) Label. Irs forms 1040 States “Section 108(i) Election Information Statement for Shareholders” across the top. Irs forms 1040 (b) Required information. Irs forms 1040 Clearly identifies for each applicable debt instrument to which an election under § 108(i) applies, the shareholder’s share of the S corporation’s— (i) COD income that the S corporation elects to defer under § 108(i); (ii) COD income deferred under § 108(i) that the shareholder must include in income in the current taxable year under § 108(i)(5)(D)(i) or (ii); (iii) OID deduction deferred under § 108(i)(2)(A)(i) in the current taxable year; (iv) OID deduction deferred under § 108(i)(2)(A)(i) that is allowable as a deduction in the current taxable year under § 108(i)(5)(D)(i) or (ii); and (v) Additional COD income that would be deferred as described in section 4. Irs forms 1040 06 of this revenue procedure. Irs forms 1040 . Irs forms 1040 09 Section 108(i) Elections Made on Behalf of Certain Foreign Corporations. Irs forms 1040 The controlling domestic shareholder(s) (or common parent of the controlling domestic shareholder(s), if applicable) of a controlled foreign corporation or a noncontrolled § 902 corporation not otherwise required to file a return of tax may make the § 108(i) election on behalf of the foreign corporation by satisfying the requirements of § 1. Irs forms 1040 964-1(c)(3). Irs forms 1040 Each controlling domestic shareholder must attach a statement identifying the foreign corporation and satisfying the requirements of section 4. Irs forms 1040 05 of this revenue procedure and, if applicable, section 4. Irs forms 1040 06 of this revenue procedure, to its federal income tax return for the taxable year ending within or with the taxable year of the foreign corporation for which the § 108(i) election is made. Irs forms 1040 . Irs forms 1040 10 Section 108(i) Elections Made By Certain Foreign Partnerships. Irs forms 1040 The rules of this section 4. Irs forms 1040 10 apply to a foreign partnership making a § 108(i) election that is not otherwise required to file a federal partnership return (“nonfiling foreign partnership”). Irs forms 1040 See § 1. Irs forms 1040 6031(a)-1(b). Irs forms 1040 (1) A nonfiling foreign partnership making the election must attach a statement satisfying the requirements of section 4. Irs forms 1040 05 of this revenue procedure and, if applicable, section 4. Irs forms 1040 06 of this revenue procedure, to a partnership return satisfying the requirements of § 1. Irs forms 1040 6031(a)-1(b)(5) it files with the Service. Irs forms 1040 In addition, a nonfiling foreign partnership must include in the information required in section 4. Irs forms 1040 05(2)(d) and (e) of this revenue procedure the aggregate amounts for all partners as well as the aggregate amounts for all U. Irs forms 1040 S. Irs forms 1040 persons (as defined in § 7701(a)(30)) and controlled foreign corporation(s) that are partners with deferred amounts in the nonfiling foreign partnership (“affected partners”). Irs forms 1040 (2) The nonfiling foreign partnership must make the election, in accordance with § 1. Irs forms 1040 6031(a)-1(b)(5), by the date provided in section 4. Irs forms 1040 01(1)(a) of this revenue procedure, as if it had a filing obligation for the taxable year in which the reacquisition of the applicable debt instrument occurs. Irs forms 1040 (3) For each affected partner, the partnership must file with the Service a Schedule K-1 (Form 1065) and report on the Schedule K-1 (Form 1065) for the affected partner as provided in section 4. Irs forms 1040 07(1) of this revenue procedure. Irs forms 1040 Except for this § 108(i) information, the partnership need not complete Part III of the Schedule K-1 (Form 1065). Irs forms 1040 The partnership must provide a copy of the respective Schedule K-1 (Form 1065) to each affected partner and must also attach to the Schedule K-1 (Form 1065) provided to each affected partner a statement satisfying the requirements of section 4. Irs forms 1040 07(2) of this revenue procedure by the date provided in section 4. Irs forms 1040 01(1)(a) of this revenue procedure. Irs forms 1040 The partnership should not attach any statement described in section 4. Irs forms 1040 07(2) of this revenue procedure to the Schedules K-1 that are filed with the Service. Irs forms 1040 However, the partnership must retain the statements provided to the affected partners, and each affected partner must retain that partner’s statement, in their respective books and records. Irs forms 1040 (4) The partnership and each affected partner must satisfy the requirements of section 4. Irs forms 1040 07(3) of this revenue procedure. Irs forms 1040 . Irs forms 1040 11 Protective § 108(i) Election. Irs forms 1040 (1) In general. Irs forms 1040 A taxpayer may make a protective election under § 108(i) for an applicable debt instrument if the taxpayer concludes that a particular transaction does not result in the realization of COD income, reports the transaction on its federal income tax return in a manner consistent with the taxpayer’s conclusion, and would be within the scope of this revenue procedure if the taxpayer’s conclusion were incorrect. Irs forms 1040 If the Service at any time determines the taxpayer’s conclusion that the particular transaction does not result in the realization of COD income is incorrect, the taxpayer’s protective election is treated as a valid, irrevocable election under § 108(i). Irs forms 1040 Thus, if a taxpayer makes a protective election, the Service subsequently may require the taxpayer to report COD income deferred pursuant to the valid and irrevocable protective election even if the statute of limitations has expired for the year in which the COD income was realized and the protective election was made. Irs forms 1040 A taxpayer makes a protective election by attaching a statement satisfying the requirements of this section 4. Irs forms 1040 11(1) to the taxpayer’s original federal income tax return within the period described in section 4. Irs forms 1040 01(1)(a) of this revenue procedure. Irs forms 1040 The taxpayer also must attach the election to its federal income tax return in each of the 8 or 9 taxable years, as applicable, following the taxable year of the election. Irs forms 1040 A statement meets the requirements of this section 4. Irs forms 1040 11(1) if the statement— (a) States “Section 108(i) Protective Election” across the top; (b) Provides the information required under section 4. Irs forms 1040 05(2)(a), (b), and (c) of this revenue procedure; (c) Provides that the amounts described in sections 4. Irs forms 1040 05(2)(d) and (e) of this revenue procedure are zero; and (d) Provides the information described in section 4. Irs forms 1040 06 of this revenue procedure. Irs forms 1040 (2) Statements provided to shareholders and partners. Irs forms 1040 (a) For each applicable debt instrument, a partnership or S corporation that makes a protective election must attach to the Schedule K-1 (Form 1065, Form 1065-B, or Form 1120S) it provides each of its partners or shareholders, as the case may be, for the taxable year in which the protective election is made a statement containing the information described in section 4. Irs forms 1040 11(1)(b) of this revenue procedure (an S corporation need not provide its shareholders with the date(s) of the transaction(s) that would constitute the reacquisition transaction or transactions) and the partner’s or shareholder’s share of the additional COD income that would be deferred as described in section 4. Irs forms 1040 11(1)(d) of this revenue procedure. Irs forms 1040 (b) The partnership or S corporation should not attach the statements described in this section 4. Irs forms 1040 11(2) to the Schedules K-1 that are filed with the Service but must retain these statements, and each partner and shareholder must retain that partner’s or shareholder’s statement, in their respective books and records. Irs forms 1040 . Irs forms 1040 12 Election-Year Reporting by Tiered Pass-Through Entities. Irs forms 1040 (1) A partnership required to file a U. Irs forms 1040 S. Irs forms 1040 partnership return other than under § 1. Irs forms 1040 6031(a)-1(b)(5), or an S corporation, that receives a Schedule K-1 (Form 1065 or Form 1065-B) reflecting its share of any items listed in section 4. Irs forms 1040 07(1) of this revenue procedure, must report on the Schedules K-1 (Form 1065, Form 1065-B, or Form 1120S) to its partners or shareholders, as the case may be, each partner’s or shareholder’s share of those items (an S corporation only reports to its shareholders the items described in section 4. Irs forms 1040 07(1)(a) through (d) of this revenue procedure). Irs forms 1040 (2) If a partnership described in section 4. Irs forms 1040 12(1) of this revenue procedure receives a statement described in sections 4. Irs forms 1040 07(2) or 4. Irs forms 1040 10(3) of this revenue procedure or this section 4. Irs forms 1040 12(2), it must provide each of its partners a statement containing the partner’s share of each of the items listed on each statement received by the partnership, including the information described in section 4. Irs forms 1040 07(2)(b)(x) of this revenue procedure. Irs forms 1040 If an S corporation receives a statement described in sections 4. Irs forms 1040 07(2) or 4. Irs forms 1040 10(3) of this revenue procedure or this section 4. Irs forms 1040 12(2), it must provide each of its shareholders a statement containing the shareholder’s share of each of the items listed on each statement received by the S corporation that are described in section 4. Irs forms 1040 07(2)(b)(i), (ii), (iii), (iv) and (ix) of this revenue procedure. Irs forms 1040 The partnership or S corporation must attach this statement or statements to the Schedule K-1 (Form 1065, Form 1065-B, or Form 1120S) that it provides to each of its partners or shareholders, as the case may be, for the taxable year of the partnership or S corporation. Irs forms 1040 The partnership or S corporation should not attach these statements to the Schedules K-1 that are filed with the Service but must retain these statements, and each partner and shareholder must retain that partner’s or shareholder’s statement, in their respective books and records. Irs forms 1040 (3) A partnership that receives a statement described in this section 4 identifying its COD income amount with respect to an applicable debt instrument must allocate its COD income amount, without regard to § 108(i), to the partners in the partnership immediately before the reacquisition transaction in the manner in which the income would be included in the distributive shares of these partners under § 704 and the regulations thereunder, including § 1. Irs forms 1040 704-1(b)(2)(iii). Irs forms 1040 The partnership may determine in any manner the portion, if any, of a partner’s COD income amount that is the partner’s deferred amount and the portion, if any, of a partner’s COD income amount that is the partner’s included amount. Irs forms 1040 No partner’s deferred amount with respect to an applicable debt instrument may exceed its COD income amount with respect to the applicable debt instrument, and the aggregate of deferred amounts of its partners with respect to an applicable debt instrument must equal the partnership’s deferred amount with respect to the applicable debt instrument. Irs forms 1040 The partnership allocates amounts described in section 4. Irs forms 1040 06 of this revenue procedure under this section 4. Irs forms 1040 12(3) as if the additional COD income was realized. Irs forms 1040 (4) The deferred § 752 amount for partners in a partnership making a § 108(i) election is calculated only for the partnership’s direct partners. Irs forms 1040 No further adjustment to the deferred § 752 amount is made to reflect the basis or other attributes of partners that are indirect partners in the partnership. Irs forms 1040 (5) If an S corporation receives a statement described in this section 4 identifying its COD income amount, deferred amount, included amount or additional COD income that would be deferred with respect to an applicable debt instrument, these amounts are shared pro rata only among those shareholders that are shareholders in the S corporation immediately before the reacquisition transaction. Irs forms 1040 (6) This paragraph 4. Irs forms 1040 12(6) provides the rules for Category 1 and Category 2 filers of Form 8865, Return of U. Irs forms 1040 S. Irs forms 1040 Persons With Respect to Certain Foreign Partnerships, as defined in the instructions for Form 8865, if the foreign partnership, for which the Category 1 or Category 2 filer has a filing requirement, receives a Schedule K-1 (Form 1065 or Form 1065-B) reflecting the partnership’s share of any items listed in section 4. Irs forms 1040 07(1) of this revenue procedure, or a statement described in sections 4. Irs forms 1040 07(2) or 4. Irs forms 1040 10(3) of this revenue procedure (because the foreign partnership owns an interest directly or indirectly in another partnership in which an election was made under § 108(i) with respect to that foreign partnership’s distributive share from the other entity). Irs forms 1040 (a) For each partner for whom the Category 1 filer is required to complete a Schedule K-1 (Form 8865) (which includes the Category 1 filer itself), the Category 1 filer must: (i) Include the information described in section 4. Irs forms 1040 07(1) of this revenue procedure in the Schedule K-1 (Form 8865) that the Category 1 filer files with the Service and completes for the partner; (ii) Produce a statement containing the partner’s share of the items listed on each statement received by the partnership; and (iii) Attach the statement described in section 4. Irs forms 1040 12(6)(a)(ii) of this revenue procedure to each Schedule K-1 (Form 8865) that it is required to provide to a partner of the foreign partnership. Irs forms 1040 (b) A Category 2 filer must include its share of the information described in section 4. Irs forms 1040 07(1) on the Schedule K-1 (Form 8865) that it is required to complete. Irs forms 1040 Category 2 filers also must complete a statement containing their share of the items listed on each statement received by the partnership. Irs forms 1040 (c) The Category 1 and Category 2 filers should not attach the statements described in sections 4. Irs forms 1040 12(6)(a)(ii) and 4. Irs forms 1040 12(6)(b) of this revenue procedure, respectively, to the Schedules K-1 that are filed with the Service. Irs forms 1040 However, Category 1 filers must retain the statements they complete and each partner must retain its own statement, in their respective books and records. Irs forms 1040 (7) If as a result of § 108(i)(5)(D)(ii), a partner of a partnership described in section 4. Irs forms 1040 12(1) of this revenue procedure or a shareholder of an S corporation described in section 4. Irs forms 1040 12(1) of this revenue procedure must recognize items deferred under § 108(i), the partnership or S corporation must report these items on the Schedule K-1 (Form 1065, Form 1065-B, or Form 1120S) and statements provided to the partner or shareholder pursuant to section 4. Irs forms 1040 12(1) and (2) of this revenue procedure. Irs forms 1040 Similar rules apply to Category 1 and Category 2 filers (Form 8865) described in section 4. Irs forms 1040 12(6) of this revenue procedure. Irs forms 1040 (8) The provisions of section 4. Irs forms 1040 12(2), (3), (5) and (6) of this revenue procedure also apply to a statement received that is described in section 4. Irs forms 1040 11(2) of this revenue procedure, except that the information that must be provided are those items described in section 4. Irs forms 1040 11(1)(b) of this revenue procedure (an S corporation need not provide its shareholders with the date(s) of the transaction(s) that would constitute the reacquisition transaction or transactions) and the share of the partner or shareholder in the amounts described in section 4. Irs forms 1040 11(1)(d) of this revenue procedure. Irs forms 1040 SECTION 5. Irs forms 1040 REQUIRED INFORMATION STATEMENT . Irs forms 1040 01 Annual Information Statements. Irs forms 1040 Pursuant to § 108(i)(7)(B), a taxpayer that makes an election under § 108(i) (except for a protective election under section 4. Irs forms 1040 11(1) of this revenue procedure) must attach a statement meeting the requirements of section 5. Irs forms 1040 02 of this revenue procedure to its federal income tax return for each taxable year beginning with the taxable year following the taxable year for which the taxpayer makes the election and ending with the first taxable year in which all items deferred under § 108(i) have been recognized. Irs forms 1040 . Irs forms 1040 02 Contents of Statement. Irs forms 1040 A statement meets the requirements of this section 5. Irs forms 1040 02 if the statement— (1) Label. Irs forms 1040 States “Section 108(i) Information Statement” across the top; (2) Required information. Irs forms 1040 Clearly identifies for each applicable debt instrument to which an election under § 108(i) applies— (a) COD income deferred under § 108(i) that is included in income in the current taxable year under § 108(i)(1); (b) COD income deferred under § 108(i) that is included in income in the current taxable year under § 108(i)(5)(D), including a description and date of the acceleration event described in § 108(i)(5)(D); (c) COD income deferred under § 108(i) that has not been included in income in the current or prior taxable years (in the case of a partnership, the aggregate of the partners’ deferred amounts that have not been included in income in the current or prior taxable years, and in the case of an S corporation, the S corporation’s COD income deferred under § 108(i) that has not been included in income in the current or prior taxable years); (d) OID deduction deferred under § 108(i)(2)(A)(i) that is allowable as a deduction in the current taxable year under § 108(i)(2)(A)(ii); (e) OID deduction deferred under § 108(i)(2)(A)(i) that is allowable as a deduction in the current taxable year under § 108(i)(5)(D); and (f) OID deduction deferred under § 108(i)(2)(A)(i) that has not been deducted in the current or prior taxable years. Irs forms 1040 (3) Election attached. Irs forms 1040 Includes a copy of the election statement described in section 4. Irs forms 1040 05 of this revenue procedure. Irs forms 1040 . Irs forms 1040 03 Additional Annual Reporting Requirements for Certain Partnerships. Irs forms 1040 The rules of this section 5. Irs forms 1040 03 apply to partnerships other than partnerships described in section 5. Irs forms 1040 05 of this revenue procedure. Irs forms 1040 (1) In general. Irs forms 1040 A partnership that makes an election under § 108(i) (except for a protective election under section 4. Irs forms 1040 11(1) of this revenue procedure) must attach to its federal income tax returns the statements required under section 5. Irs forms 1040 01 of this revenue procedure. Irs forms 1040 In addition, for each taxable year in which a statement is required under section 5. Irs forms 1040 01 of this revenue procedure, the partnership must report on the Schedule K-1 (Form 1065 or Form 1065-B) for each partner § 108(i) information in the manner described in section 4. Irs forms 1040 07(1) of this revenue procedure. Irs forms 1040 (2) Annual information statements provided to partners. Irs forms 1040 The partnership must attach to the Schedule K-1 (Form 1065) provided to each partner for each taxable year in which a statement is required under section 5. Irs forms 1040 01 of this revenue procedure, a statement meeting the requirements of this section 5. Irs forms 1040 03(2). Irs forms 1040 The partnership should not attach these statements to the Schedules K-1 that are filed with the Service, but must retain these statements, and each partner must retain that partner’s statement, in their respective books and records. Irs forms 1040 A statement meets the requirements of this section 5. Irs forms 1040 03(2) if the statement— (a) Label. Irs forms 1040 States “Section 108(i) Annual Information Statement for Partners” across the top of the statement. Irs forms 1040 (b) Required information. Irs forms 1040 Clearly identifies for each applicable debt instrument to which a § 108(i) election applies— (i) The partner’s deferred amount that has not been included in income as of the end of the prior taxable year; (ii) The partner’s deferred amount that the partner must include in income in the current taxable year under § 108(i)(1); (iii) The partner’s deferred amount that the partner must include in income in the current taxable year under § 108(i)(5)(D)(i) or (ii); (iv) The partner’s deferred amount that has not been included in income in the current or prior taxable years; (v) The partner’s share of the partnership’s OID deduction deferred under § 108(i)(2)(A)(i) in the current taxable year; (vi) The partner’s share of the partnership’s OID deduction deferred under § 108(i)(2)(A)(i) that is allowable as a deduction in the current taxable year under § 108(i)(2)(A)(ii); (vii) The partner’s share of the partnership’s OID deduction deferred under § 108(i)(2)(A)(i) that is allowable as a deduction in the current taxable year under § 108(i)(5)(D)(i) or (ii); (viii) The partner’s share of the partnership’s OID deduction deferred under § 108(i)(2)(A)(i) that has not been deducted in the current or prior taxable years; and (ix) The partner’s deferred § 752 amount that is treated as a distribution of money to the partner under § 752 in the current taxable year and any remaining deferred § 752 amount. Irs forms 1040 If a partner fails to provide the written statement required by section 4. Irs forms 1040 07(3) of this revenue procedure, the partnership must indicate that the amounts described in this section 5. Irs forms 1040 03(2)(b)(ix) cannot be calculated because the partner did not provide the information necessary to report these amounts. Irs forms 1040 . Irs forms 1040 04 Additional Annual Reporting Requirements for an S Corporation. Irs forms 1040 (1) In general. Irs forms 1040 An S corporation that makes an election under § 108(i) (except for a protective election under section 4. Irs forms 1040 11(1) of this revenue procedure) must attach to its federal income tax returns the statements required under section 5. Irs forms 1040 01 of this revenue procedure. Irs forms 1040 In addition, for each taxable year in which a statement is required under section 5. Irs forms 1040 01 of this revenue procedure, the S corporation must report on the Schedule K-1 (Form 1120S) for each shareholder § 108(i) information in the manner described in section 4. Irs forms 1040 08(1) of this revenue procedure. Irs forms 1040 (2) Annual information statements provided to shareholders. Irs forms 1040 The S corporation must attach to the Schedule K-1 (Form 1120S) provided to each shareholder for each taxable year in which a statement is required under section 5. Irs forms 1040 01 of this revenue procedure a statement meeting the requirements of this section 5. Irs forms 1040 04(2). Irs forms 1040 The S corporation should not attach these statements to the Schedules K-1 that are filed with the Service, but must retain these statements, and each shareholder must retain that shareholder’s statement, in their respective books and records. Irs forms 1040 A statement meets the requirements of this section 5. Irs forms 1040 04(2) if the statement— (a) Label. Irs forms 1040 States “Section 108(i) Annual Information Statement for Shareholders” across the top; (b) Required information. Irs forms 1040 Clearly identifies for each applicable debt instrument to which an election under § 108(i) applies, the shareholder’s share of the S corporation’s— (i) COD income deferred under § 108(i) that has not been included in income as of the end of the prior taxable year; (ii) COD income deferred under § 108(i) that the shareholder must include in income in the current taxable year under § 108(i)(1); (iii) COD income deferred under § 108(i) that the shareholder must include in income in the current taxable year under § 108(i)(5)(D)(i) or (ii); (iv) COD income deferred under § 108(i) that has not been included in income in the current or prior taxable years; (v) OID deduction deferred under § 108(i)(2)(A)(i) in the current taxable year; (vi) OID deduction deferred under § 108(i)(2)(A)(i) that is allowable as a deduction in the current taxable year under § 108(i)(2)(A)(ii); (vii) OID deduction deferred under § 108(i)(2)(A)(i) that is allowable as a deduction in the current taxable year under § 108(i)(5)(D)(i) or (ii); and (viii) OID deduction deferred under § 108(i)(2)(A)(i) that has not been deducted in the current or prior taxable years. Irs forms 1040 . Irs forms 1040 05 Additional Annual Reporting Requirements for Certain Foreign Partnerships. Irs forms 1040 (1) The rules of this section 5. Irs forms 1040 05 apply to nonfiling foreign partnerships. Irs forms 1040 (2) A nonfiling foreign partnership that makes an election under § 108(i) (except for a protective election under section 4. Irs forms 1040 11(1) of this revenue procedure) must file federal income tax returns with the Service containing the information under § 1. Irs forms 1040 6031(a)-1(b)(5) for each taxable year in which a statement is required by section 5. Irs forms 1040 01 of this revenue procedure. Irs forms 1040 (3) The nonfiling foreign partnership must attach to its federal income tax returns the statements required under section 5. Irs forms 1040 01 of this revenue procedure, but only for that portion of the COD income allocated to affected partners. Irs forms 1040 (4) For each taxable year in which a statement is required under section 5. Irs forms 1040 01 of this revenue procedure, the nonfiling foreign partnership must provide each affected partner a Schedule K-1 (Form 1065) reporting § 108(i) information in the manner described in section 4. Irs forms 1040 07(1) of this revenue procedure. Irs forms 1040 Except for this § 108(i) information, the partnership need not complete Part III of the Schedule K-1 (Form 1065). Irs forms 1040 The partnership must provide each affected partner with a copy of the Schedule K-1 (Form 1065) by the date provided in § 1. Irs forms 1040 6031(b)-1T(b). Irs forms 1040 The partnership must attach the Schedules K-1 (Form 1065) to the federal income tax returns filed with the Service pursuant to section 5. Irs forms 1040 05(2) of this revenue procedure. Irs forms 1040 (5) For each taxable year for which a statement is required under section 5. Irs forms 1040 01 of this revenue procedure, the nonfiling foreign partnership must attach to each affected partner’s Schedule K-1 (Form 1065) a statement meeting the requirements of section 5. Irs forms 1040 03(2) of this revenue procedure. Irs forms 1040 The partnership should not attach these statements to the Schedules K-1 that are filed with the Service, but must retain the statements, and each partner must retain that partner’s statement, in their respective books and records. Irs forms 1040 . Irs forms 1040 06 Information Statements Made on Behalf of Certain Foreign Corporations. Irs forms 1040 Each controlling domestic shareholder must attach a statement identifying the foreign corporation and meeting the requirements of section 5. Irs forms 1040 02 of this revenue procedure to the shareholder’s federal income tax return for each taxable year for which a statement is required under section 5. Irs forms 1040 01 of this revenue procedure. Irs forms 1040 . Irs forms 1040 07 Additional Annual Reporting Requirements for Tiered Pass-Through Entities. Irs forms 1040 (1) A partnership required to file a U. Irs forms 1040 S. Irs forms 1040 partnership return other than under § 1. Irs forms 1040 6031(a)-1(b)(5), or an S corporation, that receives a Schedule K-1 (Form 1065 or Form 1065-B) described in the second sentence of section 5. Irs forms 1040 03(1) of this revenue procedure reflecting its share of any § 108(i) information must report on the Schedules K-1 (Form 1065, Form 1065-B, or Form 1120S) to its partners or shareholders, as the case may be, each partner’s or shareholder’s share of those items (an S corporation only reports to its shareholders the items described in section 4. Irs forms 1040 07(1)(a) through (d) of this revenue procedure). Irs forms 1040 (2) If a partnership described in section 5. Irs forms 1040 07(1) of this revenue procedure receives a statement described in sections 5. Irs forms 1040 03(2) or 5. Irs forms 1040 05(5) of this revenue procedure or this section 5. Irs forms 1040 07(2), it must provide each of its partners a statement containing the partner’s share of each of the items listed on each statement received by the partnership. Irs forms 1040 If an S corporation receives a statement described in sections 5. Irs forms 1040 03(2) or 5. Irs forms 1040 05(5) of this revenue procedure or this section 5. Irs forms 1040 07(2), it must provide each of its shareholders a statement containing the shareholder’s share of each of the items listed on each statement received by the S corporation that are described in section 5. Irs forms 1040 03(2)(b)(i) through (viii) of this revenue procedure. Irs forms 1040 The partnership or S corporation must attach the statement or statements to the Schedule K-1 (Form 1065 or Form 1065-B) or Schedule K-1 (Form 1120S) that is provided to each of its partners or shareholders, as the case may be, for the taxable year of the partnership or S corporation. Irs forms 1040 The partnership or S corporation should not attach these statements to the Schedules K-1 that are filed with the Service, but must retain these statements, and each partner and shareholder must retain that partner’s or shareholder’s statement, in their respective books and records. Irs forms 1040 (3) This paragraph 5. Irs forms 1040 07(3) provides the rules for persons described in section 4. Irs forms 1040 12(6) of this revenue procedure if the foreign partnership, for which the Category 1 or 2 filer has a filing requirement, receives a Schedule K-1 (Form 1065 or Form 1065-B) reflecting the partnership’s share of any items described in the second sentence of section 5. Irs forms 1040 03(1) of this revenue procedure, or a statement described in sections 5. Irs forms 1040 03(2) or 5. Irs forms 1040 05(5) of this revenue procedure (because the foreign partnership owns an interest directly or indirectly in another partnership in which an election was made under § 108(i) with respect to that foreign partnership’s distributive share from the other entity). Irs forms 1040 (a) For each partner for whom the Category 1 filer is required to complete a Schedule K-1 (Form 8865) (which includes the Category 1 filer itself), the Category 1 filer must: (i) Include the information described in section 4. Irs forms 1040 07(1) of this revenue procedure in the Schedule K-1 (Form 8865) that the Category 1 filer files with the Service and completes for the partner; (ii) Produce a statement containing the partner’s share of the items listed on each statement received by the partnership; and (iii) Attach the statement described in section 5. Irs forms 1040 07(3)(a)(ii) of this revenue procedure to each Schedule K-1 (Form 8865) that it is required to provide to a partner of the foreign partnership. Irs forms 1040 (b) A Category 2 filer must include its share of the information described in section 4. Irs forms 1040 07(1) on the Schedule K-1 (Form 8865) that it is required to complete. Irs forms 1040 Category 2 filers also must complete a statement containing their share of the items listed on each statement received by the partnership. Irs forms 1040 (c) The Category 1 and Category 2 filers should not attach the statements described in sections 5. Irs forms 1040 07(3)(a)(ii) and 5. Irs forms 1040 07(3)(b) of this revenue procedure, respectively, to the Schedules K-1 that are filed with the Service. Irs forms 1040 However, Category 1 filers must retain the statements they complete and each partner must retain its own statement, in their respective books and records. Irs forms 1040 (4) If as a result of § 108(i)(5)(D)(ii), a partner of a partnership described in section 5. Irs forms 1040 07(1) of this revenue procedure or a shareholder of an S corporation described in section 5. Irs forms 1040 07(1) of this revenue procedure must recognize items deferred under § 108(i), the partnership or S corporation must report these items on the Schedule K-1 (Form 1065, Form 1065-B, or Form 1120S) and statements provided to the partner or shareholder pursuant to section 5. Irs forms 1040 07(1) and (2) of this revenue procedure. Irs forms 1040 Similar rules apply to Category 1 and Category 2 filers (Form 8865) described in section 4. Irs forms 1040 12(6) of this revenue procedure. Irs forms 1040 SECTION 6. Irs forms 1040 EFFECTIVE DATE This revenue procedure is effective for reacquisitions of applicable debt instruments in taxable years ending after December 31, 2008. Irs forms 1040 SECTION 7. Irs forms 1040 TRANSITION RULE . Irs forms 1040 01 Noncomplying Election. Irs forms 1040 Except as otherwise provided in this section 7. Irs forms 1040 01, the Service will treat a § 108(i) election as effective if a taxpayer files an election with the taxpayer’s federal income tax return filed on or before September 16, 2009, using any reasonable procedure to make the election. Irs forms 1040 However, an election that does not comply with section 4 of this revenue procedure will not be effective unless the taxpayer on or before November 16, 2009, files an amended return for the taxable year of the election and complies with the requirements of section 4 of this revenue procedure. Irs forms 1040 . Irs forms 1040 02 Modification of Election. Irs forms 1040 A taxpayer that files a § 108(i) election on or before September 16, 2009, may modify that election by filing an amended return on or before November 16, 2009 (for example, to modify the amount of COD income the taxpayer elects to defer). Irs forms 1040 To be effective, a modification of an election described in the preceding sentence must satisfy the requirements for an election described in section 4 of this revenue procedure. Irs forms 1040 . Irs forms 1040 03 Notations. Irs forms 1040 A taxpayer that files the amended return on paper must write “Section 108(i) Election” on the top of the first page. Irs forms 1040 A taxpayer that files the amended return electronically should indicate “Section 108(i) Election” on the return. Irs forms 1040 See Publication 4163, Modernized e-File (MeF) Information for Authorized IRS e-file Providers for Business Returns Tax Year 2008 for more details. Irs forms 1040 SECTION 8. Irs forms 1040 PAPERWORK REDUCTION ACT The collection of information contained in this revenue procedure has been reviewed and approved by the Office of Management and Budget in accordance with the Paperwork Reduction Act (44 U. Irs forms 1040 S. Irs forms 1040 C. Irs forms 1040 3507) under control number 1545-2147. Irs forms 1040 An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless the collection of information displays a valid OMB control number. Irs forms 1040 The collection of information in this revenue procedure is in sections 4, 5 and 7. Irs forms 1040 This information is required to determine the amount of income and deductions a taxpayer elects to defer and to track those amounts until the taxpayer has reported all deferred income and deductions on the taxpayer’s tax return. Irs forms 1040 This information will be used during examination to verify that a taxpayer has correctly deferred income and deductions. Irs forms 1040 The collection of information is required to obtain a benefit. Irs forms 1040 The likely respondents are C corporations, shareholders of S corporations, partners of partnerships, and other individuals engaged in a trade or business, that reacquire applicable debt instruments in 2009 or 2010. Irs forms 1040 The estimated total annual reporting burden is 300,000 hours. Irs forms 1040 The estimated annual burden per respondent varies from 1 to 8 hours, depending on individual circumstances, with an estimated average of 6 hours. Irs forms 1040 The estimated number of respondents is 50,000. Irs forms 1040 Books or records relating to a collection of information must be retained as long as their contents may become material in the administration of any internal revenue law. Irs forms 1040 Generally, tax returns and return information are confidential, as required by § 6103. Irs forms 1040 DRAFTING INFORMATION The principal authors of this revenue procedure are Megan A. Irs forms 1040 Stoner of the Office of Associate Chief Counsel (Passthroughs & Special Industries) and Craig Wojay of the Office of Associate Chief Counsel (Income Tax & Accounting). Irs forms 1040 For further information regarding this revenue procedure, contact Megan A. Irs forms 1040 Stoner at (202) 622-3070 for questions involving partnerships and S corporations, William E. Irs forms 1040 Blanchard at (202) 622-3950 for questions involving OID, Ronald M. Irs forms 1040 Gootzeit at (202) 622-3860 for questions involving foreign entities, Robert Rhyne at (202) 622-7790 for questions involving earnings and profits and consolidated groups, and Craig Wojay at (202) 622-4920 for questions on § 108(i) generally (not toll-free calls). Irs forms 1040 Prev  Up  Next   Home   More Internal Revenue Bulletins