Filing Your Taxes Online is Fast, Easy and Secure.
Start now and receive your tax refund in as little as 7 days.

1. Get Answers

Your online questions are customized to your unique tax situation.

2. Maximize your Refund

Find tax credits for everything from school tuition to buying a hybri

3. E-File for FREE

E-file free with direct deposit to get your refund in as few as 7 days.

Filing your taxes with paper mail can be difficult and it could take weeks for your refund to arrive. IRS e-file is easy, fast and secure. There is no paperwork going to the IRS so tax refunds can be processed in as little as 7 days with direct deposit. As you prepare your taxes online, you can see your tax refund in real time.

FREE audit support and representation from an enrolled agent – NEW and only from H&R Block

Tax Forms 1040

Can You File 2012 Taxes In 2014Filing State TaxFile 2010 Taxes Online Late TurbotaxUnemployment Tax FormsE File Amended Return2010 Turbotax Download1040ez 2010Federal Income Tax AmendmentH And R Block Online FilingAmended Tax Return OnlineFile 2007 Taxes1040 Ez 2010Www.irs Tax Form 1040ez For 2012Partnership State Tax FormsTaxwise SoftwareTurbo Tax State EfileState Taxes FormsHr Block 2011 TaxesForm 1040a 2012I Need To File My 2012 Federal TaxesFile 2012 Taxes Free OnlineFree Fed 1040ez FilingAmending 2012 Federal Tax ReturnAmend 2009 Tax Return1040 Ez File OnlineEz Tax Form 2011H&r Block Amended Return 2013Late Tax PenaltyFree Fed And State EfileTaxcut ComIrs 1040ez File OnlineCan I Still File 2011 Taxes OnlineCan You File Your State Taxes For Free2011 State Tax FormH&r Block Free File Tax ReturnFile My 2011 Taxes Online FreeAmend Your TaxesFree Tax Calculator1040ez WorksheetTax Form Ez

Tax Forms 1040

Tax forms 1040 5. Tax forms 1040   How To Get Tax Help Table of Contents Low Income Taxpayer Clinics Whether it's help with a tax issue, preparing your tax return or a need for a free publication or form, get the help you need the way you want it: online, use a smart phone, call or walk in to an IRS office or volunteer site near you. Tax forms 1040 Free help with your tax return. Tax forms 1040   You can get free help preparing your return nationwide from IRS-certified volunteers. Tax forms 1040 The Volunteer Income Tax Assistance (VITA) program helps low-to-moderate income, elderly, people with disabilities, and limited English proficient taxpayers. Tax forms 1040 The Tax Counseling for the Elderly (TCE) program helps taxpayers age 60 and older with their tax returns. Tax forms 1040 Most VITA and TCE sites offer free electronic filing and all volunteers will let you know about credits and deductions you may be entitled to claim. Tax forms 1040 In addition, some VITA and TCE sites provide taxpayers the opportunity to prepare their own return with help from an IRS-certified volunteer. Tax forms 1040 To find the nearest VITA or TCE site, you can use the VITA Locator Tool on IRS. Tax forms 1040 gov, download the IRS2Go app, or call 1-800-906-9887. Tax forms 1040   As part of the TCE program, AARP offers the Tax-Aide counseling program. Tax forms 1040 To find the nearest AARP Tax-Aide site, visit AARP's website at www. Tax forms 1040 aarp. Tax forms 1040 org/money/taxaide or call 1-888-227-7669. Tax forms 1040 For more information on these programs, go to IRS. Tax forms 1040 gov and enter “VITA” in the search box. Tax forms 1040 Internet. Tax forms 1040    IRS. Tax forms 1040 gov and IRS2Go are ready when you are —24 hours a day, 7 days a week. Tax forms 1040 Download the free IRS2Go app from the iTunes app store or from Google Play. Tax forms 1040 Use it to check your refund status, order transcripts of your tax returns or tax account, watch the IRS YouTube channel, get IRS news as soon as it's released to the public, subscribe to filing season updates or daily tax tips, and follow the IRS Twitter news feed, @IRSnews, to get the latest federal tax news, including information about tax law changes and important IRS programs. Tax forms 1040 Check the status of your 2013 refund with the Where's My Refund? application on IRS. Tax forms 1040 gov or download the IRS2Go app and select the Refund Status option. Tax forms 1040 The IRS issues more than 9 out of 10 refunds in less than 21 days. Tax forms 1040 Using these applications, you can start checking on the status of your return within 24 hours after we receive your e-filed return or 4 weeks after you mail a paper return. Tax forms 1040 You will also be given a personalized refund date as soon as the IRS processes your tax return and approves your refund. Tax forms 1040 The IRS updates Where's My Refund? every 24 hours, usually overnight, so you only need to check once a day. Tax forms 1040 Use the Interactive Tax Assistant (ITA) to research your tax questions. Tax forms 1040 No need to wait on the phone or stand in line. Tax forms 1040 The ITA is available 24 hours a day, 7 days a week, and provides you with a variety of tax information related to general filing topics, deductions, credits, and income. Tax forms 1040 When you reach the response screen, you can print the entire interview and the final response for your records. Tax forms 1040 New subject areas are added on a regular basis. Tax forms 1040  Answers not provided through ITA may be found in Tax Trails, one of the Tax Topics on IRS. Tax forms 1040 gov which contain general individual and business tax information or by searching the IRS Tax Map, which includes an international subject index. Tax forms 1040 You can use the IRS Tax Map, to search publications and instructions by topic or keyword. Tax forms 1040 The IRS Tax Map integrates forms and publications into one research tool and provides single-point access to tax law information by subject. Tax forms 1040 When the user searches the IRS Tax Map, they will be provided with links to related content in existing IRS publications, forms and instructions, questions and answers, and Tax Topics. Tax forms 1040 Coming this filing season, you can immediately view and print for free all 5 types of individual federal tax transcripts (tax returns, tax account, record of account, wage and income statement, and certification of non-filing) using Get Transcript. Tax forms 1040 You can also ask the IRS to mail a return or an account transcript to you. Tax forms 1040 Only the mail option is available by choosing the Tax Records option on the IRS2Go app by selecting Mail Transcript on IRS. Tax forms 1040 gov or by calling 1-800-908-9946. Tax forms 1040 Tax return and tax account transcripts are generally available for the current year and the past three years. Tax forms 1040 Determine if you are eligible for the EITC and estimate the amount of the credit with the Earned Income Tax Credit (EITC) Assistant. Tax forms 1040 Visit Understanding Your IRS Notice or Letter to get answers to questions about a notice or letter you received from the IRS. Tax forms 1040 If you received the First Time Homebuyer Credit, you can use the First Time Homebuyer Credit Account Look-up tool for information on your repayments and account balance. Tax forms 1040 Check the status of your amended return using Where's My Amended Return? Go to IRS. Tax forms 1040 gov and enter Where's My Amended Return? in the search box. Tax forms 1040 You can generally expect your amended return to be processed up to 12 weeks from the date we receive it. Tax forms 1040 It can take up to 3 weeks from the date you mailed it to show up in our system. Tax forms 1040 Make a payment using one of several safe and convenient electronic payment options available on IRS. Tax forms 1040 gov. Tax forms 1040 Select the Payment tab on the front page of IRS. Tax forms 1040 gov for more information. Tax forms 1040 Determine if you are eligible and apply for an online payment agreement, if you owe more tax than you can pay today. Tax forms 1040 Figure your income tax withholding with the IRS Withholding Calculator on IRS. Tax forms 1040 gov. Tax forms 1040 Use it if you've had too much or too little withheld, your personal situation has changed, you're starting a new job or you just want to see if you're having the right amount withheld. Tax forms 1040 Determine if you might be subject to the Alternative Minimum Tax by using the Alternative Minimum Tax Assistant on IRS. Tax forms 1040 gov. Tax forms 1040 Request an Electronic Filing PIN by going to IRS. Tax forms 1040 gov and entering Electronic Filing PIN in the search box. Tax forms 1040 Download forms, instructions and publications, including accessible versions for people with disabilities. Tax forms 1040 Locate the nearest Taxpayer Assistance Center (TAC) using the Office Locator tool on IRS. Tax forms 1040 gov, or choose the Contact Us option on the IRS2Go app and search Local Offices. Tax forms 1040 An employee can answer questions about your tax account or help you set up a payment plan. Tax forms 1040 Before you visit, check the Office Locator on IRS. Tax forms 1040 gov, or Local Offices under Contact Us on IRS2Go to confirm the address, phone number, days and hours of operation, and the services provided. Tax forms 1040 If you have a special need, such as a disability, you can request an appointment. Tax forms 1040 Call the local number listed in the Office Locator, or look in the phone book under United States Government, Internal Revenue Service. Tax forms 1040 Apply for an Employer Identification Number (EIN). Tax forms 1040 Go to IRS. Tax forms 1040 gov and enter Apply for an EIN in the search box. Tax forms 1040 Read the Internal Revenue Code, regulations, or other official guidance. Tax forms 1040 Read Internal Revenue Bulletins. Tax forms 1040 Sign up to receive local and national tax news and more by email. Tax forms 1040 Just click on “subscriptions” above the search box on IRS. Tax forms 1040 gov and choose from a variety of options. Tax forms 1040 Phone. Tax forms 1040    You can call the IRS, or you can carry it in your pocket with the IRS2Go app on your smart phone or tablet. Tax forms 1040 Download the free IRS2Go app from the iTunes app store or from Google Play. Tax forms 1040 Call to locate the nearest volunteer help site, 1-800-906-9887 or you can use the VITA Locator Tool on IRS. Tax forms 1040 gov, or download the IRS2Go app. Tax forms 1040 Low-to-moderate income, elderly, people with disabilities, and limited English proficient taxpayers can get free help with their tax return from the nationwide Volunteer Income Tax Assistance (VITA) program. Tax forms 1040 The Tax Counseling for the Elderly (TCE) program helps taxpayers age 60 and older with their tax returns. Tax forms 1040 Most VITA and TCE sites offer free electronic filing. Tax forms 1040 Some VITA and TCE sites provide IRS-certified volunteers who can help prepare your tax return. Tax forms 1040 Through the TCE program, AARP offers the Tax-Aide counseling program; call 1-888-227-7669 to find the nearest Tax-Aide location. Tax forms 1040 Call the automated Where's My Refund? information hotline to check the status of your 2013 refund 24 hours a day, 7 days a week at 1-800-829-1954. Tax forms 1040 If you e-file, you can start checking on the status of your return within 24 hours after the IRS receives your tax return or 4 weeks after you've mailed a paper return. Tax forms 1040 The IRS issues more than 9 out of 10 refunds in less than 21 days. Tax forms 1040 Where's My Refund? will give you a personalized refund date as soon as the IRS processes your tax return and approves your refund. Tax forms 1040 Before you call this automated hotline, have your 2013 tax return handy so you can enter your social security number, your filing status, and the exact whole dollar amount of your refund. Tax forms 1040 The IRS updates Where's My Refund? every 24 hours, usually overnight, so you only need to check once a day. Tax forms 1040 Note, the above information is for our automated hotline. Tax forms 1040 Our live phone and walk-in assistors can research the status of your refund only if it's been 21 days or more since you filed electronically or more than 6 weeks since you mailed your paper return. Tax forms 1040 Call the Amended Return Hotline, 1-866-464-2050, to check the status of your amended return. Tax forms 1040 You can generally expect your amended return to be processed up to 12 weeks from the date we receive it. Tax forms 1040 It can take up to 3 weeks from the date you mailed it to show up in our system. Tax forms 1040 Call 1-800-TAX-FORM (1-800-829-3676) to order current-year forms, instructions, publications, and prior-year forms and instructions (limited to 5 years). Tax forms 1040 You should receive your order within 10 business days. Tax forms 1040 Call TeleTax, 1-800-829-4477, to listen to pre-recorded messages covering general and business tax information. Tax forms 1040 If, between January and April 15, you still have questions about the Form 1040, 1040A, or 1040EZ (like filing requirements, dependents, credits, Schedule D, pensions and IRAs or self-employment taxes), call 1-800-829-1040. Tax forms 1040 Call using TTY/TDD equipment, 1-800-829-4059 to ask tax questions or order forms and publications. Tax forms 1040 The TTY/TDD telephone number is for people who are deaf, hard of hearing, or have a speech disability. Tax forms 1040 These individuals can also contact the IRS through relay services such as the Federal Relay Service. Tax forms 1040 Walk-in. Tax forms 1040   You can find a selection of forms, publications and services — in-person. Tax forms 1040 Products. Tax forms 1040 You can walk in to some post offices, libraries, and IRS offices to pick up certain forms, instructions, and publications. Tax forms 1040 Some IRS offices, libraries, and city and county government offices have a collection of products available to photocopy from reproducible proofs. Tax forms 1040 Services. Tax forms 1040 You can walk in to your local TAC for face-to-face tax help. Tax forms 1040 An employee can answer questions about your tax account or help you set up a payment plan. Tax forms 1040 Before visiting, use the Office Locator tool on IRS. Tax forms 1040 gov, or choose the Contact Us option on the IRS2Go app and search Local Offices for days and hours of operation, and services provided. Tax forms 1040 Mail. Tax forms 1040   You can send your order for forms, instructions, and publications to the address below. Tax forms 1040 You should receive a response within 10 business days after your request is received. Tax forms 1040 Internal Revenue Service 1201 N. Tax forms 1040 Mitsubishi Motorway Bloomington, IL 61705-6613    The Taxpayer Advocate Service Is Here to Help You. Tax forms 1040 The Taxpayer Advocate Service (TAS) is your voice at the IRS. Tax forms 1040 Our job is to ensure that every taxpayer is treated fairly and that you know and understand your rights. Tax forms 1040   What can TAS do for you? We can offer you free help with IRS problems that you can't resolve on your own. Tax forms 1040 We know this process can be confusing, but the worst thing you can do is nothing at all! TAS can help if you can't resolve your tax problem and: Your problem is causing financial difficulties for you, your family, or your business. Tax forms 1040 You face (or your business is facing) an immediate threat of adverse action. Tax forms 1040 You've tried repeatedly to contact the IRS but no one has responded, or the IRS hasn't responded by the date promised. Tax forms 1040   If you qualify for our help, you'll be assigned to one advocate who'll be with you at every turn and will do everything possible to resolve your problem. Tax forms 1040 Here's why we can help: TAS is an independent organization within the IRS. Tax forms 1040 Our advocates know how to work with the IRS. Tax forms 1040 Our services are free and tailored to meet your needs. Tax forms 1040 We have offices in every state, the District of Columbia, and Puerto Rico. Tax forms 1040   How can you reach us? If you think TAS can help you, call your local advocate, whose number is in your local directory and at Taxpayer Advocate, or call us toll-free at 1-877-777-4778. Tax forms 1040   How else does TAS help taxpayers?  TAS also works to resolve large-scale, systemic problems that affect many taxpayers. Tax forms 1040 If you know of one of these broad issues, please report it to us through our Systemic Advocacy Management System. Tax forms 1040 Low Income Taxpayer Clinics Low Income Taxpayer Clinics (LITCs) serve individuals whose income is below a certain level and need to resolve tax problems such as audits, appeals and tax collection disputes. Tax forms 1040 Some clinics can provide information about taxpayer rights and responsibilities in different languages for individuals who speak English as a second language. Tax forms 1040 Visit Taxpayer Advocate or see IRS Publication 4134, Low Income Taxpayer Clinic List. Tax forms 1040 Prev  Up  Next   Home   More Online Publications
Español

U.S. Government Podcast Directory

Podcasts from the U.S. government.


The Tax Forms 1040

Tax forms 1040 Accelerated Cost Recovery System (ACRS) Table of Contents Topics - This chapter discusses: Useful Items - You may want to see: ACRS Defined What Can and Cannot Be Depreciated Under ACRSRecovery Property Nonrecovery Property How To Figure the DeductionUnadjusted Basis Classes of Recovery Property Recovery Periods Alternate ACRS Method (Modified Straight Line Method) ACRS Deduction in Short Tax Year DispositionsEarly dispositions of ACRS property other than 15-, 18-, or 19-year real property. Tax forms 1040 Dispositions — mass asset accounts. Tax forms 1040 Early dispositions — 15-year real property. Tax forms 1040 Early dispositions — 18- and 19-year real property. Tax forms 1040 Depreciation Recapture Topics - This chapter discusses: The definition of ACRS What can and cannot be depreciated under ACRS How to figure the deduction Dispositions Useful Items - You may want to see: Publication 544 Sales and Other Dispositions of Assets 551 Basis of Assets 583 Starting a Business and Keeping Records Form (and Instructions) 3115 Application for Change in Accounting Method 4562 Depreciation and Amortization The Accelerated Cost Recovery System (ACRS) applies to property first used before 1987. Tax forms 1040 It is the name given to tax rules for getting back (recovering) through depreciation deductions the cost of property used in a trade or business or to produce income. Tax forms 1040 These rules are mandatory and generally apply to tangible property placed in service after 1980 and before 1987. Tax forms 1040 If you placed property in service during this period, you must continue to figure your depreciation under ACRS. Tax forms 1040 If you used listed property placed in service after June 18, 1984, less than 50% for business in 1995, see Predominant Use Test in chapter 3. Tax forms 1040 Listed property includes cars, other means of transportation, and certain computers. Tax forms 1040 Any additions or improvements placed in service after 1986, including any components of a building (such as plumbing, wiring, storm windows, etc. Tax forms 1040 ), are depreciated using MACRS, discussed in chapter 3 of Publication 946. Tax forms 1040 It does not matter that the underlying property is depreciated under ACRS or one of the other methods. Tax forms 1040 ACRS Defined ACRS consists of accelerated depreciation methods and an alternate ACRS method that could have been elected. Tax forms 1040 The alternate ACRS method used a recovery percentage based on a modified straight line method. Tax forms 1040 The law prescribes fixed percentages to be uses for each class of property. Tax forms 1040 Property depreciable under ACRS is called recovery property. Tax forms 1040 The recovery class of property determines the recovery period. Tax forms 1040 Generally, the class life of property places it in a 3-year, 5-year, 10-year, 15-year, 18-year, or 19-year recovery class. Tax forms 1040 Under ACRS, the prescribed percentages are used to recover the unadjusted basis of recovery property. Tax forms 1040 To figure a depreciation deduction, you multiply the prescribed percentage for the recovery class by the unadjusted basis of the recovery property. Tax forms 1040 You must continue to figure your depreciation under ACRS for property placed in service after 1980 and before 1987. Tax forms 1040 For property you placed in service after 1986, you must use MACRS, discussed in chapter 3 of Publication 946. Tax forms 1040 What Can and Cannot Be Depreciated Under ACRS ACRS applies to most depreciable tangible property placed in service after 1980 and before 1987. Tax forms 1040 It includes new or used and real or personal property. Tax forms 1040 The property must be for use in a trade or business or for the production of income. Tax forms 1040 Property you acquired before 1981 or after 1986 is not ACRS recovery property. Tax forms 1040 For information on depreciating property acquired before 1981, see chapter 2. Tax forms 1040 For information on depreciating property acquired after 1986, see chapter 3 of Publication 946. Tax forms 1040 Recovery Property Recovery property under ACRS is tangible depreciable property placed in service after 1980 and before 1987. Tax forms 1040 It generally includes new or used property that you acquired after 1980 and before 1987 for use in your trade or business or for the production of income. Tax forms 1040 Nonrecovery Property You cannot use ACRS for property you placed in service before 1981 or after 1986. Tax forms 1040 Nonrecovery property also includes: Intangible property, Property you elected to exclude from ACRS that is properly depreciated under a method of depreciation that is not based on a term of years, Certain public utility property, and Certain property acquired and excluded from ACRS because of the antichurning rules. Tax forms 1040 Intangible property. Tax forms 1040   Intangible property is not depreciated under ACRS. Tax forms 1040 Property depreciated under methods not expressed in a term of years. Tax forms 1040   Certain property depreciated under a method not expressed in a term of years is not depreciated under ACRS. Tax forms 1040 This included any property: If you made an irrevocable election to exclude such property, and In the first year that you could have claimed depreciation, you properly used the unit-of-production method or any method of depreciation not expressed in a term of years (not including the retirement-replacement-betterment method). Tax forms 1040 Public utility property. Tax forms 1040   Public utility property for which the taxpayer does not use a normalization method of accounting is excluded from ACRS and is subject to depreciation under a special rule. Tax forms 1040 Additions or improvements to ACRS property after 1986. Tax forms 1040   Any additions or improvements placed in service after 1986, including any components of a building (plumbing, wiring, storm windows, etc. Tax forms 1040 ) are depreciated using MACRS, discussed in chapter 3 of Publication 946. Tax forms 1040 It does not matter that the underlying property is depreciated under ACRS or one of the other methods. Tax forms 1040 How To Figure the Deduction After you determine that your property can be depreciated under ACRS, you are ready to figure your deduction. Tax forms 1040 Because the conventions are built into the percentage table rates, you only need to know the following: The unadjusted basis of your recovery property, The classes of recovery property, The recovery periods, and Whether to use the prescribed percentages based on accelerated methods or percentages based on using the alternate ACRS method. Tax forms 1040 Unadjusted Basis To figure your ACRS deduction, you multiply the unadjusted basis in your recovery property by its applicable percentage for the year. Tax forms 1040 Unadjusted basis is the same amount you would use to figure gain on a sale, but it is figured without taking into account any depreciation taken in earlier years. Tax forms 1040 However, reduce your original basis by the amount of amortization taken on the property and by any section 179 deduction claimed as discussed in chapter 2 of Publication 946. Tax forms 1040 If you buy property, your unadjusted basis is usually its cost minus any amortized amount and minus any section 179 deduction elected. Tax forms 1040 If you acquire property in some other way, such as by inheriting it, getting it as a gift, or building it yourself, you figure your unadjusted basis under other rules. Tax forms 1040 See Publication 551. Tax forms 1040 Classes of Recovery Property All recovery property under ACRS is in one of the following classes. Tax forms 1040 The class for your property was determined when you began to depreciate it. Tax forms 1040 3-Year Property 3-year property includes automobiles, light-duty trucks (actual unloaded weight less than 13,000 pounds), and tractor units for use over-the-road. Tax forms 1040 Race horses over 2 years old when placed in service are 3-year property. Tax forms 1040 Any other horses over 12 years old when you placed them in service are also included in the 3-year property class. Tax forms 1040 The ACRS percentages for 3-year recovery property are: Recovery Period Percentage 1st year 25% 2nd year 38% 3rd year 37% If you used the percentages above to depreciate your 3-year recovery property, your property, except for certain passenger automobiles, is fully depreciated. Tax forms 1040 You cannot claim depreciation for this property after 1988. Tax forms 1040 5-Year Property 5-year property includes computers, copiers, and equipment, such as office furniture and fixtures. Tax forms 1040 It also includes single purpose agricultural or horticultural structures and petroleum storage facilities (other than buildings and their structural components). Tax forms 1040 The ACRS percentages for 5-year recovery property are: Recovery period Percentage 1st year 15% 2nd year 22% 3rd through 5th year 21% If you used the percentages above to depreciate your 5-year recovery property, it is fully depreciated. Tax forms 1040 You cannot claim depreciation for this property after 1990. Tax forms 1040 10-Year Property 10-year property includes certain real property such as theme-park structures and certain public utility property. Tax forms 1040 Manufactured homes (including mobile homes) and railroad tank cars are also 10-year property. Tax forms 1040 You do not treat a building, and its structural components, as 10-year property by reason of a change in use after you placed the property in service. Tax forms 1040 For example, a building (15-year real property) that was placed in service in 1981 and was converted to a theme-park structure in 1986 remains 15-year real property. Tax forms 1040 The ACRS percentages for 10-year recovery property are: Recovery Period Percentage 1st year 8% 2nd year 14% 3rd year 12% 4th through 6th year 10% 7th through 10th year 9% If you used the percentages above, you cannot claim depreciation for this property after 1995. Tax forms 1040 Example. Tax forms 1040 On April 21, 1986, you bought and placed in service a new mobile home for $26,000 to be used as rental property. Tax forms 1040 You paid $10,000 cash and signed a note for $16,000 giving you an unadjusted basis of $26,000. Tax forms 1040 On June 8, 1986, you bought and placed in service a used mobile home for use as rental property at a total cost of $11,500. Tax forms 1040 The total unadjusted basis of your 10-year recovery property placed in service in 1986 was $37,500 ($26,000 + $11,500). Tax forms 1040 Your ACRS deduction was $3,000 (8% × $37,500). Tax forms 1040 In 1987, your ACRS deduction was $5,250 (14% × $37,500). Tax forms 1040 In 1988, your ACRS deduction was $4,500 (12% × $37,500). Tax forms 1040 In 1989, 1990, and 1991, your ACRS deduction was $3,750 (10% × $37,500). Tax forms 1040 In 1992, 1993, 1994, and 1995 your deduction for each year is $3,375 (9% × $37,500). Tax forms 1040 15-Year Real Property 15-year real property is real property that is recovery property placed in service before March 16, 1984. Tax forms 1040 It includes all real property, such as buildings, other than that designated as 5-year or 10-year property. Tax forms 1040 Unlike the 3-, 5-, or 10-year classes of property, the percentages for 15-year real property depend on when you placed the property in service during your tax year. Tax forms 1040 You could group 15-year real property by month and year placed in service. Tax forms 1040 In Table 1, at the end of this publication in the Appendix, find the month in your tax year that you placed the property in service in your trade or business or for the production of income. Tax forms 1040 You use the percentages listed under that month for each year of the recovery period to determine your depreciation deduction each year. Tax forms 1040 Example. Tax forms 1040 On March 5, 1984, you placed an apartment building in service in your business. Tax forms 1040 It is 15-year real property. Tax forms 1040 After subtracting the value of the land, your unadjusted basis in the building is $250,000. Tax forms 1040 You use the calendar year as your tax year. Tax forms 1040 March is the third month of your tax year. Tax forms 1040 Your ACRS deduction for 1984 was $25,000 (10% × $250,000). Tax forms 1040 For 1985, the percentage for the third month of the second year of the recovery period is 11%. Tax forms 1040 Your deduction was $27,500 (11% × $250,000). Tax forms 1040 For the third, fourth, and fifth years of the recovery period (1986, 1987, and 1988), the percentages are 9%, 8%, and 7%. Tax forms 1040 For 1989 through 1992, the percentage for the third month is 6%. Tax forms 1040 Your deduction each year is $15,000 (6% × $250,000). Tax forms 1040 For 1993, 1994, and 1995, the percentage for the third month is 5%. Tax forms 1040 Your depreciation deduction is $12,500 (5% × $250,000) for 1993, 1994, and 1995. Tax forms 1040 Low-Income Housing Low-income housing that was assigned a 15-year recovery period under ACRS includes the following types of property: Federally assisted housing projects where the mortgage is insured under section 221(d)(3) or 236 of the National Housing Act, or housing financed or assisted by direct loan or tax abatement under similar provisions of state or local laws. Tax forms 1040 Low-income rental housing for which a depreciation deduction for rehabilitation expenditures is allowed. Tax forms 1040 Low-income rental housing held for occupancy by families or individuals eligible to receive subsidies under section 8 of the United States Housing Act of 1937, as amended, or under the provisions of state or local laws that authorize similar subsidies for low-income families. Tax forms 1040 Housing financed or assisted by direct loan or insured under Title V of the Housing Act of 1949. Tax forms 1040 The ACRS percentages for low-income housing real property, like the regular 15-year real property percentages, depend on when you placed the property in service. Tax forms 1040 Find the month in your tax year in Table 2 or 3 at the end of this publication in the Appendix that you first placed the property in service as rental housing. Tax forms 1040 Use the percentages listed under that month for each year of the recovery period. Tax forms 1040 Table 2 shows percentages for low-income housing placed in service before May 9, 1985. Tax forms 1040 Table 3 shows percentages for low-income housing placed in service after May 8, 1985, and before 1987. Tax forms 1040 Example. Tax forms 1040 In May 1986, you acquired and placed in service a house that qualified as low-income rental housing under item 3) of the above listing. Tax forms 1040 You use the calendar year as your tax year. Tax forms 1040 You use Table C–3 because the property was placed in service after May 8, 1985. Tax forms 1040 Your unadjusted basis for the property, not including the land, was $59,000. Tax forms 1040 Your deduction for 1986 through 2001 is shown in the following table. Tax forms 1040 Year Rate Deduction 1986 8. Tax forms 1040 9% $5,251 1987 12. Tax forms 1040 1% 7,139 1988 10. Tax forms 1040 5% 6,195 1989 9. Tax forms 1040 1% 5,369 1990 7. Tax forms 1040 9% 4,661 1991 6. Tax forms 1040 9% 4,071 1992 5. Tax forms 1040 9% 3,481 1993 5. Tax forms 1040 2% 3,068 1994 4. Tax forms 1040 6% 2,714 1995 4. Tax forms 1040 6% 2,714 1996 4. Tax forms 1040 6% 2,714 1997 4. Tax forms 1040 6% 2,714 1998 4. Tax forms 1040 6% 2,714 1999 4. Tax forms 1040 5% 2,655 2000 4. Tax forms 1040 5% 2,655 2001 1. Tax forms 1040 5% 885 18-Year Real Property 18-year real property is real property that is recovery property placed in service after March 15, 1984, and before May 9, 1985. Tax forms 1040 It includes real property, such as buildings, other than that designated as 5-year, 10-year, 15-year real property, or low-income housing. Tax forms 1040 The ACRS percentages for 18-year real property depend on when you placed the property in service in your trade or business or for the production of income during your tax year. Tax forms 1040 There are also tables for 18-year real property in the Appendix. Tax forms 1040 Table 4 shows the percentages for 18-year real property you placed in service after June 22, 1984, and before May 9, 1985. Tax forms 1040 Table 5 is for 18-year real property placed in service after March 15, 1984, and before June 23, 1984. Tax forms 1040 Find the month in your tax year that you placed the property in service in a trade or business or for the production of income. Tax forms 1040 Use the percentages listed under that month for each year of the recovery period. Tax forms 1040 Example. Tax forms 1040 On April 28, 1985, you bought and placed in service a rental house. Tax forms 1040 The house, not including the land, cost $95,000. Tax forms 1040 This is your unadjusted basis for the house. Tax forms 1040 You use the calendar year as your tax year. Tax forms 1040 Because the house was placed in service after June 22, 1984, and before May 9, 1985, it is 18-year real property. Tax forms 1040 You use Table 4 to figure your deduction for the house. Tax forms 1040 April is the fourth month of your tax year. Tax forms 1040 Your deduction for 1985 through 2003 is shown in the following table. Tax forms 1040 Year Rate Deduction 1985 7. Tax forms 1040 0% $6,650 1986 9. Tax forms 1040 0% 8,550 1987 8. Tax forms 1040 0% 7,600 1988 7. Tax forms 1040 0% 6,650 1989 7. Tax forms 1040 0% 6,650 1990 6. Tax forms 1040 0% 5,700 1991 5. Tax forms 1040 0% 4,750 1992 5. Tax forms 1040 0% 4,750 1993 5. Tax forms 1040 0% 4,750 1994 5. Tax forms 1040 0% 4,750 1995 5. Tax forms 1040 0% 4,750 1996 5. Tax forms 1040 0% 4,750 1997 5. Tax forms 1040 0% 4,750 1998 4. Tax forms 1040 0% 3,800 1999 4. Tax forms 1040 0% 3,800 2000 4. Tax forms 1040 0% 3,800 2001 4. Tax forms 1040 0% 3,800 2002 4. Tax forms 1040 0% 3,800 2003 1. Tax forms 1040 0% 950 19-Year Real Property 19-year real property is real property that is recovery property placed in service after May 8, 1985, and before 1987. Tax forms 1040 It includes all real property, other than that designated as 5-year, 10-year, 15-year, or 18-year real property, or low-income housing. Tax forms 1040 The ACRS percentages for 19-year real property depend on when you placed the property in service in a trade or business or for the production of income during your tax year. Tax forms 1040 Table 6 shows the percentages for 19-year real property. Tax forms 1040 You find the month in your tax year that you placed the property in service. Tax forms 1040 You use the percentages listed under that month for each year of the recovery period. Tax forms 1040 Recovery Periods Each item of recovery property is assigned to a class of property. Tax forms 1040 The classes of recovery property establish the recovery periods over which the unadjusted basis of items in a class is recovered. Tax forms 1040 The classes of property are: 3-Year property 5-Year property 10-Year property 15-Year real property Low-income housing 18-Year real property 19-Year real property Alternate ACRS Method (Modified Straight Line Method) ACRS provides an alternate ACRS method that could be elected. Tax forms 1040 This alternate ACRS method uses a recovery percentage based on a modified straight line method. Tax forms 1040 This alternate ACRS method generally uses percentages other than those from the tables. Tax forms 1040 If you elected the alternate ACRS method, you determine the recovery period by using the following schedule. Tax forms 1040 This schedule is for other than 18- and 19-year real property and low-income housing: In the case of: You could have elected a recovery period of: 3-year property 3, 5, or 12 years 5-year property 5, 12, or 25 years 15-year real property 15, 35, or 45 years Percentages. Tax forms 1040   The straight-line percentages for the alternate ACRS method are: Recovery Period Percentage 5 years 20. Tax forms 1040 00% 10 years 10. Tax forms 1040 00% 12 years 8. Tax forms 1040 333% 15 years 6. Tax forms 1040 667% 25 years 4. Tax forms 1040 00% 35 years 2. Tax forms 1040 857%   You apply the percentage to the unadjusted basis(defined earlier) of the property to figure your ACRS deduction. Tax forms 1040 There are tables for 18- and 19-year real property later in this publication in the Appendix. Tax forms 1040 For 15-year real property, see 15-year real property, later. Tax forms 1040 3-, 5-, and 10-year property. Tax forms 1040   If you elected to use an alternate recovery percentage, you have to use the same recovery percentage for all property in that class that you placed in service in that tax year. Tax forms 1040 This applies throughout the recovery period you selected. Tax forms 1040 Half-year convention. Tax forms 1040   If you elected the alternate method, only a half-year of depreciation was deducted for the year you placed the property in service. Tax forms 1040 This applied regardless of when in the tax year you placed the property in service. Tax forms 1040 For each of the remaining years in the recovery period, you take a full year's deduction. Tax forms 1040 If you hold the property for the entire recovery period, a half-year of depreciation is allowable for the year following the end of the recovery period. Tax forms 1040 Example. Tax forms 1040 You operate a small upholstery business. Tax forms 1040 On March 19, 1986, you bought and placed in service a $13,000 light-duty panel truck to be used in your business and a $500 electric saw. Tax forms 1040 You elected to use the alternate ACRS method. Tax forms 1040 You did not elect to take a section 179 deduction. Tax forms 1040 You decided to recover the cost of the truck, which is 3-year recovery property, over 5 years. Tax forms 1040 The saw is 5-year property, but you decided to recover its cost over 12 years. Tax forms 1040 For 1986, your ACRS deduction reflected the half-year convention. Tax forms 1040 In the first year, you deducted half of the amount determined for a full year. Tax forms 1040 Your ACRS deduction for 1986 is as follows: Light-duty truck   5 years straight line = 20% 20% ÷ $13,000 = $2,600 Half-year convention -½ of $2,600= $1,300. Tax forms 1040 00     Electric saw   12 years straight line = 8. Tax forms 1040 333% 8. Tax forms 1040 333% ÷ $500 = $41. Tax forms 1040 67 Half-year convention -½ of $41. Tax forms 1040 67= 20. Tax forms 1040 84 Total ACRS deduction for 1986 $1,320. Tax forms 1040 84       You take a full year of depreciation for both the truck and the saw for the years 1987 through 1990. Tax forms 1040 Your ACRS deduction for each of those years is as follows: Light-duty truck   5 years straight line = 20% 20% ÷ $13,000 = $2,600     Electric saw     12 years straight line = 8. Tax forms 1040 333% 8. Tax forms 1040 333% ÷ $500 = $41. Tax forms 1040 67 Total annual ACRS deduction for 1987 through 1990 $2,641. Tax forms 1040 67       In 1991, you take a half-year of depreciation for the truck and a full year of depreciation for the saw. Tax forms 1040 Your ACRS deduction for 1991 is as follows: Light-duty truck   5 years straight line = 20% 20% ÷ $13,000 = $2,600 Half-year convention -½ of $2,600= $1,300. Tax forms 1040 00     Electric saw   12 years straight line = 8. Tax forms 1040 333% 8. Tax forms 1040 333% ÷ $500 = $41. Tax forms 1040 67 Total ACRS deduction for 1991 $1,341. Tax forms 1040 67       The truck is fully depreciated after 1991. Tax forms 1040 You take a full year of depreciation for the saw for the years 1992 through 1997. Tax forms 1040 Your ACRS deduction for each of those years is as follows: Electric saw     12 years straight line = 8. Tax forms 1040 333% 8. Tax forms 1040 333% ÷ $500 = $41. Tax forms 1040 67 Total annual ACRS deduction for 1992 through 1997 $41. Tax forms 1040 67       You take a half-year of depreciation for the saw for 1998. Tax forms 1040 Your ACRS deduction for 1998 is as follows: Electric saw   12 years straight line = 8. Tax forms 1040 333% 8. Tax forms 1040 333% ÷ $500 = $41. Tax forms 1040 67 Half-year convention -½ of $41. Tax forms 1040 67= 20. Tax forms 1040 84 Total ACRS deduction for 1998 $20. Tax forms 1040 84       The saw is fully depreciated after 1998. Tax forms 1040 15-year real property. Tax forms 1040   Under ACRS, you could also elect to use the alternate ACRS method for 15-year real property. Tax forms 1040 The alternate ACRS method allows you to depreciate your 15-year real property using the straight line ACRS method over the alternate recovery periods of 15, 35, or 45 years. Tax forms 1040 If you selected a 15-year recovery period, you use the percentage (6. Tax forms 1040 667%) from the schedule above. Tax forms 1040 You prorate this percentage for the number of months the property was in service in the first year. Tax forms 1040 If you selected a 35- or 45-year recovery period, you use either Table 11 or 15. Tax forms 1040 Alternate periods for 18-year real property. Tax forms 1040   For 18-year real property, the alternate recovery periods are 18, 35, or 45 years. Tax forms 1040 The percentages for 18-year real property under the alternate method are in Tables 7, 8, 10, 11, 14, and 15 in the Appendix. Tax forms 1040 There are two tables for each alternate recovery period. Tax forms 1040 One table shows the percentage for property placed in service after June 22, 1984. Tax forms 1040 The other table has the percentages for property placed in service after March 15, 1984, and before June 23, 1984. Tax forms 1040 Alternate periods for 19-year real property. Tax forms 1040   For 19-year real property, the alternate recovery periods are 19, 35, or 45 years. Tax forms 1040 If you selected a 19-year recovery period, use Table 9 to determine your deduction. Tax forms 1040 If you select a 35- or 45-year recovery period, use either Table 13 or 14. Tax forms 1040 Example. Tax forms 1040 You placed in service an apartment building on August 3, 1986. Tax forms 1040 The building is 19-year real property. Tax forms 1040 The sales contract allocated $300,000 to the building and $100,000 to the land. Tax forms 1040 You use the calendar year as your tax year. Tax forms 1040 You chose the alternate ACRS method over a recovery period of 35 years. Tax forms 1040 For 1986, you figure your ACRS deduction usingTable 13. Tax forms 1040 August is the eighth month of your tax year. Tax forms 1040 The percentage from Table 13 for the eighth month is 1. Tax forms 1040 1%. Tax forms 1040 Your deduction was $3,300 ($300,000 ÷ 1. Tax forms 1040 1%). Tax forms 1040 The deduction rate from ACRS Table 13 for years 2 through 20 is 2. Tax forms 1040 9% so that your deduction in 1987 through 2005 is $8,700 ($300,000 ÷ 2. Tax forms 1040 9%). Tax forms 1040 Alternate periods for low-income housing. Tax forms 1040   For low-income housing, the alternate recovery periods are 15, 35, or 45 years. Tax forms 1040 If you selected a 15-year period for this property, use 6. Tax forms 1040 667% as the percentage. Tax forms 1040 If you selected a 35- or 45-year period, use either Table 11, 12, or 15. Tax forms 1040 Election. Tax forms 1040   You had to make the election to use the alternate ACRS method by the return due date (including extensions) for the tax year you placed the property in service. Tax forms 1040 Revocation of election. Tax forms 1040   Your election to use an alternate ACRS method, once made, can be changed only with the consent of the Commissioner. Tax forms 1040 The Commissioner grants consent only in extraordinary circumstances. Tax forms 1040 Any request for a revocation will be considered a request for a ruling. Tax forms 1040 ACRS Deduction in Short Tax Year For a tax year that is less than 12 months, the ACRS deduction is prorated on a 12-month basis. Tax forms 1040 Figure the amount of the ACRS deduction for a short tax year as follows: First, you figure the ACRS deduction for a full year. Tax forms 1040 You figure this by multiplying the unadjusted basis by the recovery percentage. Tax forms 1040 You then multiply the ACRS deduction determined for a full tax year by a fraction. Tax forms 1040 The numerator (top number) of the fraction is the number of months in the short tax year and the denominator (bottom number) is 12. Tax forms 1040 For example, a corporation placed in service in June 1986 an item of 3-year property with an unadjusted basis of $10,000. Tax forms 1040 The corporation files a tax return, because of a change in its accounting period, for the 6-month short tax year ending June 30, 1986. Tax forms 1040 The full year's ACRS deduction for this item is $2,500 ($10,000 ÷ 25%), the first year percentage from the 3-year table. Tax forms 1040 The ACRS deduction for the short tax year is $1,250 ($2,500 ÷ 6/12). Tax forms 1040 You use the full ACRS percentages during the remaining years of the recovery period. Tax forms 1040 For the first tax year after the recovery period, the unrecovered basis will be deductible. Tax forms 1040 Exception. Tax forms 1040   For the tax year in which you placed 15-, 18-, or 19-year real property in service or in the tax year you dispose of it, you compute the ACRS deduction for the number of months that the property is in service during that tax year. Tax forms 1040 You compute the number of months using either a full month or mid-month convention. Tax forms 1040 This is true regardless of the number of months in the tax year and the recovery period and method used. Tax forms 1040 Dispositions A disposition is the permanent withdrawal of property from use in your trade or business or in the production of income. Tax forms 1040 You can make a withdrawal by sale, exchange, retirement, abandonment, or destruction. Tax forms 1040 You generally recognize gain or loss on the disposition of an asset by sale. Tax forms 1040 However, nonrecognition rules can allow you to postpone some gain. Tax forms 1040 See Publication 544. Tax forms 1040 If you physically abandon property, you can deduct as a loss the adjusted basis of the asset at the time of its abandonment. Tax forms 1040 Your intent must be to discard the asset so that you will not use it again or retrieve it for sale, exchange, or other disposition. Tax forms 1040 Early dispositions. Tax forms 1040   The disposal of an asset before the end of its specified recovery period, is referred to as an early disposition. Tax forms 1040 When an early disposition occurs, the depreciation deduction in the year of disposition depends on the class of property involved. Tax forms 1040 Early dispositions of ACRS property other than 15-, 18-, or 19-year real property. Tax forms 1040   Generally, you get no ACRS deduction for the tax year in which you dispose of or retire recovery property, except for 15-, 18-, and 19-year real property. Tax forms 1040 This means there is no depreciation deduction under ACRS in the year you dispose of or retire any of your 3-, 5-, or 10-year recovery property. Tax forms 1040 Dispositions — mass asset accounts. Tax forms 1040   The law provides a special rule to avoid the calculation of gain on the disposition of assets from mass asset accounts. Tax forms 1040 A mass asset account includes items usually minor in value in relation to the group, numerous in quantity, impractical to separately identify, and not usually accounted for on a separate basis, but on a total dollar value. Tax forms 1040 Examples of mass assets include minor items of office, plant, and store furniture and fixtures. Tax forms 1040   Under the special rule, if you elected to use a mass asset account, you recognize gain to the extent of the proceeds from the disposition of the asset. Tax forms 1040 You leave the unadjusted basis of the property in the account until recovered in future years. Tax forms 1040 If you did this, include the total proceeds realized from the disposition in income on the tax return for the year of disposition. Tax forms 1040 Early dispositions — 15-year real property. Tax forms 1040   If you dispose of 15-year real property, you base your ACRS deduction for the year of disposition on the number of months in use. Tax forms 1040 You use a full-month convention. Tax forms 1040 For a disposition at any time during a particular month before the end of the recovery period, no deduction is allowed for the month of disposition. Tax forms 1040 This applies whether you use the regular ACRS method or elected the alternate ACRS method. Tax forms 1040 Example. Tax forms 1040 You purchased and placed in service a rental house on March 2, 1984, for $98,000 (not including the cost of land). Tax forms 1040 You file your return based on a calendar year. Tax forms 1040 Your rate from Table 1 for the third month is 10%. Tax forms 1040 Your ACRS deduction for 1984 was $9,800 ($98. Tax forms 1040 000 ÷ 10%). Tax forms 1040 For 1985 through 1988, you figured your ACRS deductions using 11%, 9%, 8%, and 7% ÷ $98,000. Tax forms 1040 For 1989 through 1992, you figured your ACRS deductions using 6% for each year. Tax forms 1040 The deduction each year was $98,000 ÷ 6%. Tax forms 1040 For 1993 and 1994, the ACRS deduction is ($98,000 ÷ 5%) $4,900 for each year. Tax forms 1040 You sell the house on June 1, 1995. Tax forms 1040 You figure your ACRS deduction for 1995 for the full year and then prorate that amount for the months of use. Tax forms 1040 The full ACRS deduction for 1995 is $4,900 ($98,000 ÷ 5%). Tax forms 1040 You then prorate this amount to the 5 months in 1995 during which it was rented. Tax forms 1040 Your ACRS deduction for 1995 is $2,042 ($4,900 ÷ 5/12). Tax forms 1040 Early dispositions — 18- and 19-year real property. Tax forms 1040   If you dispose of 18- or 19-year real property, you base your ACRS deduction for the year of disposition on the number of months in use. Tax forms 1040 For 18-year property placed in service before June 23, 1984, use a full-month convention on a disposition. Tax forms 1040 For 18-year property placed in service after June 22, 1984, and for 19-year property, determine the number of months in use by using the mid-month convention. Tax forms 1040 Under the mid-month convention,treat real property disposed of any time during a month as disposed of in the middle of that month. Tax forms 1040 Count the month of disposition as half a month of use. Tax forms 1040 Example. Tax forms 1040 You purchased and placed in service a rental house on July 2, 1984, for $100,000 (not including the cost of land). Tax forms 1040 You file your return based on a calendar year. Tax forms 1040 Your rate from Table 4 for the seventh month is 4%. Tax forms 1040 You figured your ACRS deduction for 1984 was $4,000 ($100,000 ÷ 4%). Tax forms 1040 In 1985 through 1994, your ACRS deductions were 9%, 8%, 8%, 7%, 6%, 6%, 5%, 5%, and 5% ÷ $100,000. Tax forms 1040 You sell the house on September 24, 1995. Tax forms 1040 Figure your ACRS deduction for 1995 for the months of use. Tax forms 1040 The full ACRS deduction for 1995 is $5,000 ($100,000 ÷ 5%). Tax forms 1040 Prorate this amount for the 8. Tax forms 1040 5 months in 1995 that you held the property. Tax forms 1040 Under the mid-month convention, you count September as half a month. Tax forms 1040 Your ACRS deduction for 1995 is $3,542 ($5,000 ÷ 8. Tax forms 1040 5/12). Tax forms 1040 Depreciation Recapture If you dispose of property depreciated under ACRS that is section 1245 recovery property, you will generally recognize gain or loss. Tax forms 1040 Gain recognized on a disposition is ordinary income to the extent of prior depreciation deductions taken. Tax forms 1040 This recapture rule applies to all personal property in the 3-year, 5-year, and 10-year classes. Tax forms 1040 You recapture gain on manufactured homes and theme park structures in the 10-year class as section 1245 property. Tax forms 1040 Section 1245 property generally includes all personal property. Tax forms 1040 See Section 1245 property in chapter 4 of Publication 544 for more information. Tax forms 1040 You treat dispositions of section 1250 real property on which you have a gain as section 1245 recovery property. Tax forms 1040 You recognize gain on this property as ordinary income to the extent of prior depreciation deductions taken. Tax forms 1040 Section 1250 property includes most real property. Tax forms 1040 See Section 1250 property in chapter 4 of Publication 544 for more information. Tax forms 1040 This rule applies to all section 1250 real property except the following property: Any 15-, 18-, or 19-year real property that is residential rental property. Tax forms 1040 Any 15-, 18-, or 19-year real property that you elected to depreciate using the alternate ACRS method. Tax forms 1040 Any 15-, 18-, or 19-year real property that is subsidized low-income housing. Tax forms 1040 For these recapture rules, you treat the section 179 deduction and 50% of the investment credit that reduced your basis as depreciation. Tax forms 1040 See Publication 544 for further discussion of dispositions of section 1245 and 1250 property. Tax forms 1040 Prev  Up  Next   Home   More Online Publications