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Irs Forms 1040ez

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Irs Forms 1040ez

Irs forms 1040ez Publication 590 - Introductory Material Table of Contents What's New for 2013 What's New for 2014 Reminders IntroductionOrdering forms and publications. Irs forms 1040ez Tax questions. Irs forms 1040ez Useful Items - You may want to see: Note. Irs forms 1040ez After 2013, Publication 590 will be split into two separate publications as follows. Irs forms 1040ez Publication 590-A, will focus on contributions to traditional IRAs as well as Roth IRAs. Irs forms 1040ez This publication will include the rules for rollover and conversion contributions. Irs forms 1040ez Publication 590-B, will focus on distributions from traditional IRAs as well as Roth IRAs. Irs forms 1040ez This publication will include the rules for required minimum distributions and IRA beneficiaries. Irs forms 1040ez What's New for 2013 Traditional IRA contribution and deduction limit. Irs forms 1040ez  The contribution limit to your traditional IRA for 2013 will be increased to the smaller of the following amounts: $5,500, or Your taxable compensation for the year. Irs forms 1040ez If you were age 50 or older before 2014, the most that can be contributed to your traditional IRA for 2013 will be the smaller of the following amounts: $6,500, or Your taxable compensation for the year. Irs forms 1040ez For more information, see How Much Can Be Contributed? in chapter 1. Irs forms 1040ez Roth IRA contribution limit. Irs forms 1040ez  If contributions on your behalf are made only to Roth IRAs, your contribution limit for 2013 will generally be the lesser of: $5,500, or Your taxable compensation for the year. Irs forms 1040ez If you were age 50 or older before 2014 and contributions on your behalf were made only to Roth IRAs, your contribution limit for 2013 will generally be the lesser of: $6,500, or Your taxable compensation for the year. Irs forms 1040ez However, if your modified adjusted gross income (AGI) is above a certain amount, your contribution limit may be reduced. Irs forms 1040ez For more information, see How Much Can Be Contributed? under Can You Contribute to a Roth IRA? in chapter 2. Irs forms 1040ez Modified AGI limit for traditional IRA contributions increased. Irs forms 1040ez  For 2013, if you were covered by a retirement plan at work, your deduction for contributions to a traditional IRA is reduced (phased out) if your modified AGI is: More than $95,000 but less than $115,000 for a married couple filing a joint return or a qualifying widow(er), More than $59,000 but less than $69,000 for a single individual or head of household, or Less than $10,000 for a married individual filing a separate return. Irs forms 1040ez If you either lived with your spouse or file a joint return, and your spouse was covered by a retirement plan at work, but you were not, your deduction is phased out if your modified AGI is more than $178,000 but less than $188,000. Irs forms 1040ez If your modified AGI is $188,000 or more, you cannot take a deduction for contributions to a traditional IRA. Irs forms 1040ez See How Much Can You Deduct? in chapter 1. Irs forms 1040ez Modified AGI limit for Roth IRA contributions increased. Irs forms 1040ez  For 2013, your Roth IRA contribution limit is reduced (phased out) in the following situations. Irs forms 1040ez Your filing status is married filing jointly or qualifying widow(er) and your modified AGI is at least $178,000. Irs forms 1040ez You cannot make a Roth IRA contribution if your modified AGI is $188,000 or more. Irs forms 1040ez Your filing status is single, head of household, or married filing separately and you did not live with your spouse at any time in 2013 and your modified AGI is at least $112,000. Irs forms 1040ez You cannot make a Roth IRA contribution if your modified AGI is $127,000 or more. Irs forms 1040ez Your filing status is married filing separately, you lived with your spouse at any time during the year, and your modified AGI is more than -0-. Irs forms 1040ez You cannot make a Roth IRA contribution if your modified AGI is $10,000 or more. Irs forms 1040ez See Can You Contribute to a Roth IRA? in chapter 2. Irs forms 1040ez Net Investment Income Tax. Irs forms 1040ez  For purposes of the Net Investment Income Tax (NIIT), net investment income does not include distributions from a qualified retirement plan (for example, 401(a), 403(a), 403(b), 457(b) plans, and IRAs). Irs forms 1040ez However, these distributions are taken into account when determining the modified adjusted gross income threshold. Irs forms 1040ez Distributions from a nonqualified retirement plan are included in net investment income. Irs forms 1040ez See Form 8960, Net Investment Income Tax—Individuals, Estates, and Trusts, and its instructions for more information. Irs forms 1040ez Kay Bailey Hutchison Spousal IRA. Irs forms 1040ez . Irs forms 1040ez  In 2013, spousal IRAs were renamed to Kay Bailey Hutchison Spousal IRAs. Irs forms 1040ez There are no changes to the rules regarding these IRAs. Irs forms 1040ez See Kay Bailey Hutchison Spousal IRA Limit in chapter 1 for more information. Irs forms 1040ez What's New for 2014 Modified AGI limit for traditional IRA contributions increased. Irs forms 1040ez  For 2014, if you are covered by a retirement plan at work, your deduction for contributions to a traditional IRA is reduced (phased out) if your modified AGI is: More than $96,000 but less than $116,000 for a married couple filing a joint return or a qualifying widow(er), More than $60,000 but less than $70,000 for a single individual or head of household, or Less than $10,000 for a married individual filing a separate return. Irs forms 1040ez If you either live with your spouse or file a joint return, and your spouse is covered by a retirement plan at work, but you are not, your deduction is phased out if your modified AGI is more than $181,000 but less than $191,000. Irs forms 1040ez If your modified AGI is $191,000 or more, you cannot take a deduction for contributions to a traditional IRA. Irs forms 1040ez Modified AGI limit for Roth IRA contributions increased. Irs forms 1040ez  For 2014, your Roth IRA contribution limit is reduced (phased out) in the following situations. Irs forms 1040ez Your filing status is married filing jointly or qualifying widow(er) and your modified AGI is at least $181,000. Irs forms 1040ez You cannot make a Roth IRA contribution if your modified AGI is $191,000 or more. Irs forms 1040ez Your filing status is single, head of household, or married filing separately and you did not live with your spouse at any time in 2014 and your modified AGI is at least $114,000. Irs forms 1040ez You cannot make a Roth IRA contribution if your modified AGI is $129,000 or more. Irs forms 1040ez Your filing status is married filing separately, you lived with your spouse at any time during the year, and your modified AGI is more than -0-. Irs forms 1040ez You cannot make a Roth IRA contribution if your modified AGI is $10,000 or more. Irs forms 1040ez Reminders Future developments. Irs forms 1040ez  For the latest information about developments related to Publication 590, such as legislation enacted after it was published, go to www. Irs forms 1040ez irs. Irs forms 1040ez gov/pub590. Irs forms 1040ez Simplified employee pension (SEP). Irs forms 1040ez  SEP IRAs are not covered in this publication. Irs forms 1040ez They are covered in Publication 560, Retirement Plans for Small Business. Irs forms 1040ez Deemed IRAs. Irs forms 1040ez  A qualified employer plan (retirement plan) can maintain a separate account or annuity under the plan (a deemed IRA) to receive voluntary employee contributions. Irs forms 1040ez If the separate account or annuity otherwise meets the requirements of an IRA, it will be subject only to IRA rules. Irs forms 1040ez An employee's account can be treated as a traditional IRA or a Roth IRA. Irs forms 1040ez For this purpose, a “qualified employer plan” includes: A qualified pension, profit-sharing, or stock bonus plan (section 401(a) plan), A qualified employee annuity plan (section 403(a) plan), A tax-sheltered annuity plan (section 403(b) plan), and A deferred compensation plan (section 457 plan) maintained by a state, a political subdivision of a state, or an agency or instrumentality of a state or political subdivision of a state. Irs forms 1040ez Contributions to both traditional and Roth IRAs. Irs forms 1040ez  For information on your combined contribution limit if you contribute to both traditional and Roth IRAs, see Roth IRAs and traditional IRAs under How Much Can Be Contributed? in chapter 2. Irs forms 1040ez Statement of required minimum distribution (RMD). Irs forms 1040ez  If an RMD is required from your IRA, the trustee, custodian, or issuer that held the IRA at the end of the preceding year must either report the amount of the RMD to you, or offer to calculate it for you. Irs forms 1040ez The report or offer must include the date by which the amount must be distributed. Irs forms 1040ez The report is due January 31 of the year in which the minimum distribution is required. Irs forms 1040ez It can be provided with the year-end fair market value statement that you normally get each year. Irs forms 1040ez No report is required for section 403(b) contracts (generally tax-sheltered annuities) or for IRAs of owners who have died. Irs forms 1040ez IRA interest. Irs forms 1040ez  Although interest earned from your IRA is generally not taxed in the year earned, it is not tax-exempt interest. Irs forms 1040ez Tax on your traditional IRA is generally deferred until you take a distribution. Irs forms 1040ez Do not report this interest on your return as tax-exempt interest. Irs forms 1040ez For more information on tax-exempt interest, see the instructions for your tax return. Irs forms 1040ez Photographs of missing children. Irs forms 1040ez  The Internal Revenue Service is a proud partner with the National Center for Missing and Exploited Children. Irs forms 1040ez Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. Irs forms 1040ez You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child. Irs forms 1040ez Introduction This publication discusses individual retirement arrangements (IRAs). Irs forms 1040ez An IRA is a personal savings plan that gives you tax advantages for setting aside money for retirement. Irs forms 1040ez What are some tax advantages of an IRA?   Two tax advantages of an IRA are that: Contributions you make to an IRA may be fully or partially deductible, depending on which type of IRA you have and on your circumstances, and Generally, amounts in your IRA (including earnings and gains) are not taxed until distributed. Irs forms 1040ez In some cases, amounts are not taxed at all if distributed according to the rules. Irs forms 1040ez What's in this publication?   This publication discusses traditional, Roth, and SIMPLE IRAs. Irs forms 1040ez It explains the rules for: Setting up an IRA, Contributing to an IRA, Transferring money or property to and from an IRA, Handling an inherited IRA, Receiving distributions (making withdrawals) from an IRA, and Taking a credit for contributions to an IRA. Irs forms 1040ez   It also explains the penalties and additional taxes that apply when the rules are not followed. Irs forms 1040ez To assist you in complying with the tax rules for IRAs, this publication contains worksheets, sample forms, and tables, which can be found throughout the publication and in the appendices at the back of the publication. Irs forms 1040ez How to use this publication. Irs forms 1040ez   The rules that you must follow depend on which type of IRA you have. Irs forms 1040ez Use Table I-1 to help you determine which parts of this publication to read. Irs forms 1040ez Also use Table I-1 if you were referred to this publication from instructions to a form. Irs forms 1040ez Comments and suggestions. Irs forms 1040ez   We welcome your comments about this publication and your suggestions for future editions. Irs forms 1040ez   You can write to us at the following address: Internal Revenue Service Tax Forms and Publications Division 1111 Constitution Ave. Irs forms 1040ez NW, IR-6526 Washington, DC 20224   We respond to many letters by telephone. Irs forms 1040ez Therefore, it would be helpful if you would include your daytime phone number, including the area code, in your correspondence. Irs forms 1040ez   You can send your comments from www. Irs forms 1040ez irs. Irs forms 1040ez gov/formspubs/. Irs forms 1040ez Click on “More Information” and then on “Comment on Tax Forms and Publications”. Irs forms 1040ez   Although we cannot respond individually to each comment received, we do appreciate your feedback and will consider your comments as we revise our tax products. Irs forms 1040ez Ordering forms and publications. Irs forms 1040ez   Visit www. Irs forms 1040ez irs. Irs forms 1040ez gov/formspubs/ to download forms and publications, call 1-800-TAX-FORM (1-800-829-3676), or write to the address below and receive a response within 10 days after your request is received. Irs forms 1040ez Internal Revenue Service 1201 N. Irs forms 1040ez Mitsubishi Motorway Bloomington, IL 61705-6613 Tax questions. Irs forms 1040ez   If you have a tax question, check the information available on IRS. Irs forms 1040ez gov or call 1-800-829-1040. Irs forms 1040ez We cannot answer tax questions sent to either of the above addresses. Irs forms 1040ez Useful Items - You may want to see: Publications 560 Retirement Plans for Small Business (SEP, SIMPLE, and Qualified Plans) 571 Tax-Sheltered Annuity Plans (403(b) Plans) 575 Pension and Annuity Income 939 General Rule for Pensions and Annuities Forms (and instructions) W-4P Withholding Certificate for Pension or Annuity Payments 1099-R Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc. Irs forms 1040ez 5304-SIMPLE Savings Incentive Match Plan for Employees of Small Employers (SIMPLE)–Not for Use With a Designated Financial Institution 5305-S SIMPLE Individual Retirement Trust Account 5305-SA SIMPLE Individual Retirement Custodial Account 5305-SIMPLE Savings Incentive Match Plan for Employees of Small Employers (SIMPLE)–for Use With a Designated Financial Institution 5329 Additional Taxes on Qualified Plans (Including IRAs) and Other Tax-Favored Accounts 5498 IRA Contribution Information 8606 Nondeductible IRAs 8815 Exclusion of Interest From Series EE and I U. Irs forms 1040ez S. Irs forms 1040ez Savings Bonds Issued After 1989 8839 Qualified Adoption Expenses 8880 Credit for Qualified Retirement Savings Contributions See chapter 5 for information about getting these publications and forms. Irs forms 1040ez Table I-1. Irs forms 1040ez Using This Publication IF you need information on . Irs forms 1040ez . Irs forms 1040ez . Irs forms 1040ez THEN see . Irs forms 1040ez . Irs forms 1040ez . Irs forms 1040ez traditional IRAs chapter 1. Irs forms 1040ez Roth IRAs chapter 2, and parts of  chapter 1. Irs forms 1040ez SIMPLE IRAs chapter 3. Irs forms 1040ez the credit for qualified retirement savings contributions (the saver's credit) chapter 4. Irs forms 1040ez how to keep a record of your contributions to, and distributions from, your traditional IRA(s) appendix A. Irs forms 1040ez SEP IRAs and 401(k) plans Publication 560. Irs forms 1040ez Coverdell education savings accounts (formerly called education IRAs) Publication 970. Irs forms 1040ez IF for 2013, you received social security benefits, had taxable compensation, contributed to a traditional IRA, and you or your spouse was covered by an employer retirement plan, and you want to. Irs forms 1040ez . Irs forms 1040ez . Irs forms 1040ez THEN see . Irs forms 1040ez . Irs forms 1040ez . Irs forms 1040ez first figure your modified adjusted gross income (AGI) appendix B, worksheet 1. Irs forms 1040ez then figure how much of your traditional IRA contribution you can deduct appendix B, worksheet 2. Irs forms 1040ez and finally figure how much of your social security is taxable appendix B, worksheet 3. Irs forms 1040ez Table I-2. Irs forms 1040ez How Are a Traditional IRA and a Roth IRA Different? This table shows the differences between traditional and Roth IRAs. Irs forms 1040ez Answers in the middle column apply to traditional IRAs. Irs forms 1040ez Answers in the right column apply to Roth IRAs. Irs forms 1040ez Question Answer   Traditional IRA? Roth IRA? Is there an age limit on when I can open and contribute to a Yes. Irs forms 1040ez You must not have reached age  70½ by the end of the year. Irs forms 1040ez See Who Can Open a Traditional IRA? in chapter 1. Irs forms 1040ez No. Irs forms 1040ez You can be any age. Irs forms 1040ez See Can You Contribute to a Roth IRA? in chapter 2. Irs forms 1040ez If I earned more than $5,500 in 2013 ($6,500 if I was 50 or older by the end of 2013), is there a limit on how much I can contribute to a Yes. Irs forms 1040ez For 2013, you can contribute to a traditional IRA up to: $5,500, or $6,500 if you were age 50 or older by the end of 2013. Irs forms 1040ez  There is no upper limit on how much you can earn and still contribute. Irs forms 1040ez See How Much Can Be Contributed? in chapter 1. Irs forms 1040ez Yes. Irs forms 1040ez For 2013, you may be able to contribute to a Roth IRA up to: $5,500, or $6,500 if you were age 50 or older by the end of 2013,  but the amount you can contribute may be less than that depending on your income, filing status, and if you contribute to another IRA. Irs forms 1040ez See How Much Can Be Contributed? and Table 2-1 in chapter 2. Irs forms 1040ez Can I deduct contributions to a Yes. Irs forms 1040ez You may be able to deduct your contributions to a traditional IRA depending on your income, filing status, whether you are covered by a retirement plan at work, and whether you receive social security benefits. Irs forms 1040ez See How Much Can You Deduct? in chapter 1. Irs forms 1040ez No. Irs forms 1040ez You can never deduct contributions to a Roth IRA. Irs forms 1040ez See What Is a Roth IRA? in chapter 2. Irs forms 1040ez Do I have to file a form just because I contribute to a Not unless you make nondeductible contributions to your traditional IRA. Irs forms 1040ez In that case, you must file Form 8606. Irs forms 1040ez See Nondeductible Contributions in chapter 1. Irs forms 1040ez No. Irs forms 1040ez You do not have to file a form if you contribute to a Roth IRA. Irs forms 1040ez See Contributions not reported in chapter 2. Irs forms 1040ez Do I have to start taking distributions when I reach a certain age from a Yes. Irs forms 1040ez You must begin receiving required minimum distributions by April 1 of the year following the year you reach age 70½. Irs forms 1040ez See When Must You Withdraw Assets? (Required Minimum Distributions) in chapter 1. Irs forms 1040ez No. Irs forms 1040ez If you are the original owner of a Roth IRA, you do not have to take distributions regardless of your age. Irs forms 1040ez See Are Distributions Taxable? in chapter 2. Irs forms 1040ez However, if you are the beneficiary of a Roth IRA, you may have to take distributions. Irs forms 1040ez See Distributions After Owner's Death in chapter 2. Irs forms 1040ez How are distributions taxed from a Distributions from a traditional IRA are taxed as ordinary income, but if you made nondeductible contributions, not all of the distribution is taxable. Irs forms 1040ez See Are Distributions Taxable? in chapter 1. Irs forms 1040ez Distributions from a Roth IRA are not taxed as long as you meet certain criteria. Irs forms 1040ez See Are Distributions Taxable? in chapter 2. Irs forms 1040ez Do I have to file a form just because I receive distributions from a Not unless you have ever made a nondeductible contribution to a traditional IRA. Irs forms 1040ez If you have, file Form 8606. Irs forms 1040ez See Nondeductible Contributions in chapter 1. Irs forms 1040ez Yes. Irs forms 1040ez File Form 8606 if you received distributions from a Roth IRA (other than a rollover, qualified charitable distribution, one-time distribution to fund an HSA, recharacterization, certain qualified distributions, or a return of certain contributions). 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The Irs Forms 1040ez

Irs forms 1040ez 5. Irs forms 1040ez   Taxes Table of Contents What's New Introduction Topics - This chapter discusses: Useful Items - You may want to see: When To Deduct Taxes Real Estate TaxesSeparate elections. Irs forms 1040ez Making the election. Irs forms 1040ez Form 3115. Irs forms 1040ez Income TaxesAccrual of contested income taxes. Irs forms 1040ez Employment Taxes Other TaxesAdditional Medicare Tax. Irs forms 1040ez What's New Additional Medicare Tax. Irs forms 1040ez  Beginning in 2013, you must withhold a 0. Irs forms 1040ez 9% Additional Medicare Tax from wages you pay to an employee in excess of $200,000 in a calendar year. Irs forms 1040ez Also, self-employed individuals may be required to pay Additional Medicare Tax on self-employment income. Irs forms 1040ez See Employment Taxes , and Self-employment tax , later. Irs forms 1040ez Introduction You can deduct various federal, state, local, and foreign taxes directly attributable to your trade or business as business expenses. Irs forms 1040ez You cannot deduct federal income taxes, estate and gift taxes, or state inheritance, legacy, and succession taxes. Irs forms 1040ez Topics - This chapter discusses: When to deduct taxes Real estate taxes Income taxes Employment taxes Other taxes Useful Items - You may want to see: Publication 15 (Circular E), Employer's Tax Guide 334 Tax Guide for Small Business 510 Excise Taxes 538 Accounting Periods and Methods 551 Basis of Assets Form (and Instructions) Sch A (Form 1040) Itemized Deductions Sch SE (Form 1040) Self-Employment Tax 3115 Application for Change in Accounting Method 8959 Additional Medicare Tax See chapter 12 for information about getting publications and forms. Irs forms 1040ez When To Deduct Taxes Generally, you can only deduct taxes in the year you pay them. Irs forms 1040ez This applies whether you use the cash method or an accrual method of accounting. Irs forms 1040ez Under an accrual method, you can deduct a tax before you pay it if you meet the exception for recurring items discussed under Economic Performance in Publication 538. Irs forms 1040ez You can also elect to ratably accrue real estate taxes as discussed later under Real Estate Taxes . Irs forms 1040ez Limit on accrual of taxes. Irs forms 1040ez   A taxing jurisdiction can require the use of a date for accruing taxes that is earlier than the date it originally required. Irs forms 1040ez However, if you use an accrual method, and can deduct the tax before you pay it, use the original accrual date for the year of change and all future years to determine when you can deduct the tax. Irs forms 1040ez Example. Irs forms 1040ez Your state imposes a tax on personal property used in a trade or business conducted in the state. Irs forms 1040ez This tax is assessed and becomes a lien as of July 1 (accrual date). Irs forms 1040ez In 2013, the state changed the assessment and lien dates from July 1, 2014, to December 31, 2013, for property tax year 2014. Irs forms 1040ez Use the original accrual date (July 1, 2014) to determine when you can deduct the tax. Irs forms 1040ez You must also use the July 1 accrual date for all future years to determine when you can deduct the tax. Irs forms 1040ez Uniform capitalization rules. Irs forms 1040ez   Uniform capitalization rules apply to certain taxpayers who produce real property or tangible personal property for use in a trade or business or for sale to customers. Irs forms 1040ez They also apply to certain taxpayers who acquire property for resale. Irs forms 1040ez Under these rules, you either include certain costs in inventory or capitalize certain expenses related to the property, such as taxes. Irs forms 1040ez For more information, see chapter 1. Irs forms 1040ez Carrying charges. Irs forms 1040ez   Carrying charges include taxes you pay to carry or develop real estate or to carry, transport, or install personal property. Irs forms 1040ez You can elect to capitalize carrying charges not subject to the uniform capitalization rules if they are otherwise deductible. Irs forms 1040ez For more information, see chapter 7. Irs forms 1040ez Refunds of taxes. Irs forms 1040ez   If you receive a refund for any taxes you deducted in an earlier year, include the refund in income to the extent the deduction reduced your federal income tax in the earlier year. Irs forms 1040ez For more information, see Recovery of amount deducted (tax benefit rule) in chapter 1. Irs forms 1040ez    You must include in income any interest you receive on tax refunds. Irs forms 1040ez Real Estate Taxes Deductible real estate taxes are any state, local, or foreign taxes on real estate levied for the general public welfare. Irs forms 1040ez The taxing authority must base the taxes on the assessed value of the real estate and charge them uniformly against all property under its jurisdiction. Irs forms 1040ez Deductible real estate taxes generally do not include taxes charged for local benefits and improvements that increase the value of the property. Irs forms 1040ez See Taxes for local benefits , later. Irs forms 1040ez If you use an accrual method, you generally cannot accrue real estate taxes until you pay them to the government authority. Irs forms 1040ez However, you can elect to ratably accrue the taxes during the year. Irs forms 1040ez See Electing to ratably accrue , later. Irs forms 1040ez Taxes for local benefits. Irs forms 1040ez   Generally, you cannot deduct taxes charged for local benefits and improvements that tend to increase the value of your property. Irs forms 1040ez These include assessments for streets, sidewalks, water mains, sewer lines, and public parking facilities. Irs forms 1040ez You should increase the basis of your property by the amount of the assessment. Irs forms 1040ez   You can deduct taxes for these local benefits only if the taxes are for maintenance, repairs, or interest charges related to those benefits. Irs forms 1040ez If part of the tax is for maintenance, repairs, or interest, you must be able to show how much of the tax is for these expenses to claim a deduction for that part of the tax. Irs forms 1040ez Example. Irs forms 1040ez To improve downtown commercial business, Waterfront City converted a downtown business area street into an enclosed pedestrian mall. Irs forms 1040ez The city assessed the full cost of construction, financed with 10-year bonds, against the affected properties. Irs forms 1040ez The city is paying the principal and interest with the annual payments made by the property owners. Irs forms 1040ez The assessments for construction costs are not deductible as taxes or as business expenses, but are depreciable capital expenses. Irs forms 1040ez The part of the payments used to pay the interest charges on the bonds is deductible as taxes. Irs forms 1040ez Charges for services. Irs forms 1040ez   Water bills, sewerage, and other service charges assessed against your business property are not real estate taxes, but are deductible as business expenses. Irs forms 1040ez Purchase or sale of real estate. Irs forms 1040ez   If real estate is sold, the real estate taxes must be allocated between the buyer and the seller. Irs forms 1040ez   The buyer and seller must allocate the real estate taxes according to the number of days in the real property tax year (the period to which the tax imposed relates) that each owned the property. Irs forms 1040ez Treat the seller as paying the taxes up to but not including the date of sale. Irs forms 1040ez Treat the buyer as paying the taxes beginning with the date of sale. Irs forms 1040ez You can usually find this information on the settlement statement you received at closing. Irs forms 1040ez   If you (the seller) use an accrual method and have not elected to ratably accrue real estate taxes, you are considered to have accrued your part of the tax on the date you sell the property. Irs forms 1040ez Example. Irs forms 1040ez Alberto Verde, a calendar year accrual method taxpayer, owns real estate in Olmo County. Irs forms 1040ez He has not elected to ratably accrue property taxes. Irs forms 1040ez November 30 of each year is the assessment and lien date for the current real property tax year, which is the calendar year. Irs forms 1040ez He sold the property on June 30, 2013. Irs forms 1040ez Under his accounting method he would not be able to claim a deduction for the taxes because the sale occurred before November 30. Irs forms 1040ez He is treated as having accrued his part of the tax, 181/366  (January 1–June 29), on June 30, and he can deduct it for 2013. Irs forms 1040ez Electing to ratably accrue. Irs forms 1040ez   If you use an accrual method, you can elect to accrue real estate tax related to a definite period ratably over that period. Irs forms 1040ez Example. Irs forms 1040ez Juan Sanchez is a calendar year taxpayer who uses an accrual method. Irs forms 1040ez His real estate taxes for the real property tax year, July 1, 2013, to June 30, 2014, are $1,200. Irs forms 1040ez July 1 is the assessment and lien date. Irs forms 1040ez If Juan elects to ratably accrue the taxes, $600 will accrue in 2013 ($1,200 × 6/12, July 1–December 31) and the balance will accrue in 2014. Irs forms 1040ez Separate elections. Irs forms 1040ez   You can elect to ratably accrue the taxes for each separate trade or business and for nonbusiness activities if you account for them separately. Irs forms 1040ez Once you elect to ratably accrue real estate taxes, you must use that method unless you get permission from the IRS to change. Irs forms 1040ez See Form 3115 , later. Irs forms 1040ez Making the election. Irs forms 1040ez   If you elect to ratably accrue the taxes for the first year in which you incur real estate taxes, attach a statement to your income tax return for that year. Irs forms 1040ez The statement should show all the following items. Irs forms 1040ez The trades or businesses to which the election applies and the accounting method or methods used. Irs forms 1040ez The period to which the taxes relate. Irs forms 1040ez The computation of the real estate tax deduction for that first year. Irs forms 1040ez   Generally, you must file your return by the due date (including extensions). Irs forms 1040ez However, if you timely filed your return for the year without electing to ratably accrue, you can still make the election by filing an amended return within 6 months after the due date of the return (excluding extensions). Irs forms 1040ez Attach the statement to the amended return and write “Filed pursuant to section 301. Irs forms 1040ez 9100-2” on the statement. Irs forms 1040ez File the amended return at the same address where you filed the original return. Irs forms 1040ez Form 3115. Irs forms 1040ez    If you elect to ratably accrue real estate taxes for a year after the first year in which you incur real estate taxes, or if you want to revoke your election to ratably accrue real estate taxes, file Form 3115. Irs forms 1040ez For more information, including applicable time frames for filing, see the Instructions for Form 3115. Irs forms 1040ez Note. Irs forms 1040ez If you are filing an application for a change in accounting method filed after January 9, 2011, for a year of change ending after April 29, 2010, see Revenue Procedure 2011-14, 2011-4 I. Irs forms 1040ez R. Irs forms 1040ez B. Irs forms 1040ez 330, as modified and clarified by Revenue Procedure 2012-19, 2012-14 I. Irs forms 1040ez R. Irs forms 1040ez B. Irs forms 1040ez 689, and Revenue Procedure 2012-20, 2012-14 I. Irs forms 1040ez R. Irs forms 1040ez B. Irs forms 1040ez 700, or any successor. Irs forms 1040ez Revenue Procedure 2011-14 is available at  www. Irs forms 1040ez irs. Irs forms 1040ez gov/irb/2011-04IRB/ar08. Irs forms 1040ez html. Irs forms 1040ez Income Taxes This section discusses federal, state, local, and foreign income taxes. Irs forms 1040ez Federal income taxes. Irs forms 1040ez   You cannot deduct federal income taxes. Irs forms 1040ez State and local income taxes. Irs forms 1040ez   A corporation or partnership can deduct state and local income taxes imposed on the corporation or partnership as business expenses. Irs forms 1040ez An individual can deduct state and local income taxes only as an itemized deduction on Schedule A (Form 1040). Irs forms 1040ez   However, an individual can deduct a state tax on gross income (as distinguished from net income) directly attributable to a trade or business as a business expense. Irs forms 1040ez Accrual of contested income taxes. Irs forms 1040ez   If you use an accrual method, and you contest a state or local income tax liability, you must accrue and deduct any contested amount in the tax year in which the liability is finally determined. Irs forms 1040ez   If additional state or local income taxes for a prior year are assessed in a later year, you can deduct the taxes in the year in which they were originally imposed (the prior year) if the tax liability is not contested. Irs forms 1040ez You cannot deduct them in the year in which the liability is finally determined. Irs forms 1040ez    The filing of an income tax return is not considered a contest and, in the absence of an overt act of protest, you can deduct the tax in the prior year. Irs forms 1040ez Also, you can deduct any additional taxes in the prior year if you do not show some affirmative evidence of denial of the liability. Irs forms 1040ez   However, if you consistently deduct additional assessments in the year they are paid or finally determined (including those for which there was no contest), you must continue to do so. Irs forms 1040ez You cannot take a deduction in the earlier year unless you receive permission to change your method of accounting. Irs forms 1040ez For more information on accounting methods, see When Can I Deduct an Expense in chapter 1. Irs forms 1040ez Foreign income taxes. Irs forms 1040ez   Generally, you can take either a deduction or a credit for income taxes imposed on you by a foreign country or a U. Irs forms 1040ez S. Irs forms 1040ez possession. Irs forms 1040ez However, an individual cannot take a deduction or credit for foreign income taxes paid on income that is exempt from U. Irs forms 1040ez S. Irs forms 1040ez tax under the foreign earned income exclusion or the foreign housing exclusion. Irs forms 1040ez For information on these exclusions, see Publication 54, Tax Guide for U. Irs forms 1040ez S. Irs forms 1040ez Citizens and Resident Aliens Abroad. Irs forms 1040ez For information on the foreign tax credit, see Publication 514, Foreign Tax Credit for Individuals. Irs forms 1040ez Employment Taxes If you have employees, you must withhold various taxes from your employees' pay. Irs forms 1040ez Most employers must withhold their employees' share of social security, Medicare taxes, and Additional Medicare Tax (if applicable) along with state and federal income taxes. Irs forms 1040ez You may also need to pay certain employment taxes from your own funds. Irs forms 1040ez These include your share of social security and Medicare taxes as an employer, along with unemployment taxes. Irs forms 1040ez Note. Irs forms 1040ez Additional Medicare Tax is only imposed on the employee. Irs forms 1040ez There is no employer share of Additional Medicare Tax. Irs forms 1040ez Your deduction for wages paid is not reduced by the social security and Medicare taxes, Additional Medicare Tax, and income taxes you withhold from your employees. Irs forms 1040ez You can deduct the employment taxes you must pay from your own funds as taxes. Irs forms 1040ez Example. Irs forms 1040ez You pay your employee $18,000 a year. Irs forms 1040ez However, after you withhold various taxes, your employee receives $14,500. Irs forms 1040ez You also pay an additional $1,500 in employment taxes. Irs forms 1040ez You should deduct the full $18,000 as wages. Irs forms 1040ez You can deduct the $1,500 you pay from your own funds as taxes. Irs forms 1040ez For more information on employment taxes, see Publication 15 (Circular E). Irs forms 1040ez Unemployment fund taxes. Irs forms 1040ez   As an employer, you may have to make payments to a state unemployment compensation fund or to a state disability benefit fund. Irs forms 1040ez Deduct these payments as taxes. Irs forms 1040ez Other Taxes The following are other taxes you can deduct if you incur them in the ordinary course of your trade or business. Irs forms 1040ez Excise taxes. Irs forms 1040ez   Generally, you can deduct as a business expense all excise taxes that are ordinary and necessary expenses of carrying on your trade or business. Irs forms 1040ez However, see Fuel taxes , later. Irs forms 1040ez   For more information on excise taxes, see Publication 510. Irs forms 1040ez Franchise taxes. Irs forms 1040ez   You can deduct corporate franchise taxes as a business expense. Irs forms 1040ez Fuel taxes. Irs forms 1040ez   Generally, taxes on gasoline, diesel fuel, and other motor fuels that you use in your business are included as part of the cost of the fuel. Irs forms 1040ez Do not deduct these taxes as a separate item. Irs forms 1040ez   You may be entitled to a credit or refund for federal excise tax you paid on fuels used for certain purposes. Irs forms 1040ez For more information, see Publication 510. Irs forms 1040ez Occupational taxes. Irs forms 1040ez   You can deduct as a business expense an occupational tax charged at a flat rate by a locality for the privilege of working or conducting a business in the locality. Irs forms 1040ez Personal property tax. Irs forms 1040ez   You can deduct any tax imposed by a state or local government on personal property used in your trade or business. Irs forms 1040ez Sales tax. Irs forms 1040ez   Treat any sales tax you pay on a service or on the purchase or use of property as part of the cost of the service or property. Irs forms 1040ez If the service or the cost or use of the property is a deductible business expense, you can deduct the tax as part of that service or cost. Irs forms 1040ez If the property is merchandise bought for resale, the sales tax is part of the cost of the merchandise. Irs forms 1040ez If the property is depreciable, add the sales tax to the basis for depreciation. Irs forms 1040ez For more information on basis, see Publication 551. Irs forms 1040ez    Do not deduct state and local sales taxes imposed on the buyer that you must collect and pay over to the state or local government. Irs forms 1040ez Also, do not include these taxes in gross receipts or sales. Irs forms 1040ez Self-employment tax. Irs forms 1040ez   You can deduct part of your self-employment tax as a business expense in figuring your adjusted gross income. Irs forms 1040ez This deduction only affects your income tax. Irs forms 1040ez It does not affect your net earnings from self-employment or your self-employment tax. Irs forms 1040ez   To deduct the tax, enter on Form 1040, line 27, the amount shown on the Deduction for one-half of self-employment tax line of Schedule SE (Form 1040). Irs forms 1040ez   For more information on self-employment tax, see Publication 334. Irs forms 1040ez Additional Medicare Tax. Irs forms 1040ez   Beginning in 2013, you may be required to pay Additional Medicare Tax on self-employment income. Irs forms 1040ez See Form 8959 and the Instructions for Form 8959 for more information on the Additional Medicare Tax. Irs forms 1040ez Prev  Up  Next   Home   More Online Publications