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 Planning Us 1040ez

College Students Filing TaxesIrs 1040ez 2010H & R Block Free Online TaxesFederal Tax Return Forms 1040ezState Free FileMississippi State Tax Return Forms 2012H&r Block Online 1040x2011 Form 1040xForm 1040nr Ez2012 Tax Form 1040ezIncome Tax Forms2012 Free Tax Software OnlineHow To Amend A ReturnFree 1040ez Filing OnlineInstruction Booklet For 1040xFiling 1040ez Electronically2012 Tax AmendmentFree State Tax Efile For Low IncomeH&r Block Free State File CodeFreetaxusa2011Free Tax Filing For State And FederalTaxslayer Coupon Code2011 Federal Tax Forms 1040ezFiling Past TaxesFederal Ez Tax Form 2011Federal Tax Amended ReturnI Need To Amend My 2012 TaxesState Income Tax ReturnIrs Income Tax Forms 2011File Taxes For FreeHow Do I File Taxes For 2010Free Online 1040ez FilingFree TaxesH&r Block Key Code Free State FilingWhere Can I Get A 2011 Tax FormFree H R Block 2011Free Tax 2012HrblockNj 1040nrIrs 2011 Taxes Online

Tax Planning Us 1040ez

Tax planning us 1040ez Index A Accelerated death benefits, Accelerated Death Benefits Accounting periods Change in, standard deduction not allowed, Persons not eligible for the standard deduction. Tax planning us 1040ez Accrued leave payment Disability retirement and, Accrued leave payment. Tax planning us 1040ez Adjusted gross income (AGI), Adjustments to Income Adjustments to income, Adjustments to Income Age Standard deduction for age 65 or older, Higher standard deduction for age (65 or older). Tax planning us 1040ez Age 65, Qualified Individual American Association of Retired Persons (AARP), Volunteer Income Tax Assistance and Tax Counseling for the Elderly. Tax planning us 1040ez Annuities, Pensions and Annuities Assistance (see Tax help) B Base amount, social security benefits, Base Amount Benefits Accident or health, Other compensation. Tax planning us 1040ez Long-term care, Long-Term Care Insurance Contracts No-fault insurance, Other compensation. Tax planning us 1040ez Sickness and injury, Sickness and Injury Benefits Social security, Are Any of Your Benefits Taxable? Veterans', Veterans' benefits. Tax planning us 1040ez Bequests, Gifts and inheritances. Tax planning us 1040ez Blind persons Standard deduction for, Higher standard deduction for blindness. Tax planning us 1040ez C Child and dependent care credit, Child and Dependent Care Credit Children Standard deduction for, Standard Deduction for Dependents Chronically ill persons, Chronically ill individual. Tax planning us 1040ez Chronically ill, defined, Terminally or chronically ill defined. Tax planning us 1040ez Compensation For services, Compensation for Services Loss or disfigurement, Other compensation. Tax planning us 1040ez Contributions Foreign employment, Foreign employment contributions. Tax planning us 1040ez Pension or annuity, Cost. Tax planning us 1040ez Cost, pension or annuity, Cost. Tax planning us 1040ez Credit Child and dependent care, Child and Dependent Care Credit Earned income, Earned Income Credit (EIC) The elderly or the disabled, Credit for the Elderly or the Disabled Credit for the elderly or the disabled, Credit for the Elderly or the Disabled D Death benefit, accelerated, Accelerated Death Benefits Decedents, Dependents. Tax planning us 1040ez Standard deduction, Decedent's final return. Tax planning us 1040ez Deductions Generally, Deductions Insurance premiums, Medical Insurance Premiums Itemized, Itemized Deductions Meals and lodging, Meals and Lodging Medical and dental, Medical and Dental Expenses Standard, Standard Deduction Dependents, Dependents. Tax planning us 1040ez Standard deduction for, Standard Deduction for Dependents Disabilities, individuals with Ownership and use test, Exception to use test for individuals with a disability. Tax planning us 1040ez Disability Person with, Persons with disabilities. Tax planning us 1040ez Physician's statement, Physician's statement. Tax planning us 1040ez Total and permanent, Permanent and total disability. Tax planning us 1040ez Disability income, Disability Pensions, Other compensation. Tax planning us 1040ez , Disability income. Tax planning us 1040ez Distributions, retirement plan, Retirement Plan Distributions Drugs (see Medicines) Dual-status taxpayers Standard deduction, Persons not eligible for the standard deduction. Tax planning us 1040ez E Early distributions, tax, Tax on Early Distributions Earned income credit, Earned Income Credit (EIC) Elderly or disabled credit, Credit for the Elderly or the Disabled Elderly persons Standard deduction for age 65 or older, Higher standard deduction for age (65 or older). Tax planning us 1040ez Employment tax withholding, Reminders Employment taxes, Employment taxes. Tax planning us 1040ez Endowment proceeds, Endowment Contract Proceeds Estimated tax, Tax Withholding and Estimated Tax, Estimated Tax, Who Must Make Estimated Tax Payments Excess accumulation, tax on, Tax on Excess Accumulation Exclusion, gain on sale of home, Maximum Amount of Exclusion F Federal Employees Compensation Act (FECA) payments, Federal Employees' Compensation Act (FECA). Tax planning us 1040ez Filing requirements Decedents, Dependents. Tax planning us 1040ez General requirements, General Requirements Surviving spouse, Surviving spouse. Tax planning us 1040ez Final return for decedent Standard deduction, Decedent's final return. Tax planning us 1040ez First-time homebuyer credit Recapture, Repaying the first-time homebuyer credit because you sold your home. Tax planning us 1040ez Form, Credit for the Elderly or the Disabled, Physician's statement. Tax planning us 1040ez 1099-R, Form 1099-R. Tax planning us 1040ez , Form 1099-R. Tax planning us 1040ez 5329, Form 5329. Tax planning us 1040ez 8853, Accelerated Death Benefits Schedule R, Credit for the Elderly or the Disabled, Physician's statement. Tax planning us 1040ez W-4P, Withholding. Tax planning us 1040ez Free tax services, Free help with your tax return. Tax planning us 1040ez G Gain on sale of home (see Sale of home) General rule, pension or annuity, Pensions and Annuities Gifts, Gifts and inheritances. Tax planning us 1040ez H Help (see Tax help) Home care (see Nursing services) Home improvements, Home Improvements Home, sale of, Sale of Home Hospital services, Hospital Services Household help, Household Help I Income Adjustments, Adjustments to Income Disability, Disability Pensions, Disability income. Tax planning us 1040ez Gross, defined, Gross income. Tax planning us 1040ez Nontaxable, Taxable and Nontaxable Income Sale of home, Sale of Home Self-employment, Self-employed persons. Tax planning us 1040ez Taxable, Taxable and Nontaxable Income Individual retirement arrangement (IRA) Adjustments to income, Individual Retirement Arrangement (IRA) Contributions and Deductions Contributions, Contributions. Tax planning us 1040ez Deductible contribution, Deductible contribution. Tax planning us 1040ez Distributions, Individual Retirement Arrangements (IRAs) Inheritances, Gifts and inheritances. Tax planning us 1040ez Injury benefits, Sickness and Injury Benefits, Cost paid by you. Tax planning us 1040ez Insurance Accident and health, Other compensation. Tax planning us 1040ez , Medical Insurance Premiums Benefits, long-term care, Long-Term Care Insurance Contracts Benefits, no-fault insurance, Other compensation. Tax planning us 1040ez Life insurance proceeds, Life Insurance Proceeds Proceeds paid after death, Life Insurance Proceeds Proceeds paid before death, Accelerated Death Benefits Insurance premiums for retired public safety officers, Insurance Premiums for Retired Public Safety Officers Itemized deductions, Itemized Deductions Married filing separately One spouse has itemized, Persons not eligible for the standard deduction. Tax planning us 1040ez L Life insurance proceeds, Life Insurance Proceeds Long-term care, Long-Term Care Chronically ill individuals, Chronically ill individual. Tax planning us 1040ez Maintenance and personal care services, Maintenance and personal care services. Tax planning us 1040ez Qualified insurance contracts, Qualified long-term care insurance contracts. Tax planning us 1040ez Qualified services, Qualified long-term care services. Tax planning us 1040ez Long-term care insurance, Long-Term Care Insurance Contracts Loss or disfigurement compensation, Other compensation. Tax planning us 1040ez Lump-sum distributions, Lump-sum distributions. Tax planning us 1040ez Lump-sum election, social security, Lump-Sum Election M Maintenance and personal care services, Maintenance and personal care services. Tax planning us 1040ez Married filing separately Itemized deductions One spouse has itemized so other must as well, Persons not eligible for the standard deduction. Tax planning us 1040ez Married taxpayers Age 65 or older spouse Standard deduction, Spouse 65 or older or blind. Tax planning us 1040ez Blind spouse Standard deduction, Spouse 65 or older or blind. Tax planning us 1040ez Meals and lodging expenses, Meals and Lodging Medical expenses, Medical and Dental Expenses Medicare, Medicare Part A. Tax planning us 1040ez , Medicare Part B. Tax planning us 1040ez , Medicare Part D. Tax planning us 1040ez Benefits, Medicare. Tax planning us 1040ez Medicines, Medicines Imported, Imported medicines and drugs. Tax planning us 1040ez Military retirement pay, Military Retirement Pay Minimum distributions, Tax on Excess Accumulation Minimum wage, Substantial gainful activity. Tax planning us 1040ez Missing children, Reminders Mortgage assistance payments, Mortgage assistance payments. Tax planning us 1040ez N Nonperiodic distributions, Nonperiodic Distributions Nonqualified use, Period of nonqualified use. Tax planning us 1040ez Nonresident aliens Standard deduction, Persons not eligible for the standard deduction. Tax planning us 1040ez Nontaxable income, Payments from a state fund for victims of crime. Tax planning us 1040ez Accident or health insurance benefits, Other compensation. Tax planning us 1040ez Bequests, Gifts and inheritances. Tax planning us 1040ez Generally, Taxable and Nontaxable Income Gifts, Gifts and inheritances. Tax planning us 1040ez Inheritances, Gifts and inheritances. Tax planning us 1040ez Mortgage assistance payments, Mortgage assistance payments. Tax planning us 1040ez No-fault insurance benefits, Other compensation. Tax planning us 1040ez Nutrition program for elderly, Nutrition Program for the Elderly. Tax planning us 1040ez Public assistance payments, Welfare benefits. Tax planning us 1040ez Sickness and injury benefits, Sickness and Injury Benefits Veterans' benefits, Veterans' benefits. Tax planning us 1040ez Winter energy use, Payments to reduce cost of winter energy use. Tax planning us 1040ez Workers' compensation, Workers' Compensation Nursing home, Nursing home. Tax planning us 1040ez Nursing services, Nursing Services Chronically ill individuals, Chronically ill individual. Tax planning us 1040ez Nutrition program for elderly, Nutrition Program for the Elderly. Tax planning us 1040ez O Old-age, survivors, and disability insurance benefits (OASDI), Old-age, survivors, and disability insurance benefits (OASDI). Tax planning us 1040ez Other items, Other Items Overall limitation, Overall limitation. Tax planning us 1040ez P Payments, estimated tax, Estimated Tax Pensions, Pensions and Annuities Pensions, disability, Disability Pensions Photographs, missing children, Reminders Physician's statement, disability, Physician's statement. Tax planning us 1040ez Prepaid insurance premiums, Prepaid insurance premiums. Tax planning us 1040ez Preparer, paid, Reminders Preparing your return, Return preparation assistance. Tax planning us 1040ez Profit-sharing plan, Retirement and profit-sharing plans. Tax planning us 1040ez Public assistance payments, Welfare benefits. Tax planning us 1040ez Publications (see Tax help) Q Qualified retirement plan, Tax on Early Distributions R Railroad retirement benefits, Railroad Retirement Benefits, Social Security and Equivalent Railroad Retirement Benefits Repayments Social security benefits, Repayment of Benefits Reporting pension income, How to report. Tax planning us 1040ez Residence, sale of, Sale of Home Retirement plans, distributions, Retirement Plan Distributions Returns Decedent, Dependents. Tax planning us 1040ez Executors and administrators, Dependents. Tax planning us 1040ez Filing requirements, 2013 Filing Requirements Surviving spouse, Surviving spouse. Tax planning us 1040ez Reverse mortgages, Reverse Mortgages S Salaries (see Compensation) Sale of Home First-time homebuyer credit, Repaying the first-time homebuyer credit because you sold your home. Tax planning us 1040ez Surviving spouse, Reminders Sale of home, Sale of Home Self-employed, Self-employed persons. Tax planning us 1040ez Short tax year Change in annual accounting period, Persons not eligible for the standard deduction. Tax planning us 1040ez Sickness and injury benefits, Sickness and Injury Benefits Simplified method, Pensions and Annuities Social security benefits, Social Security and Equivalent Railroad Retirement Benefits Standard deduction, Standard Deduction Age 65 or older, Higher standard deduction for age (65 or older). Tax planning us 1040ez Blind persons, Higher standard deduction for blindness. Tax planning us 1040ez Dependents, Standard Deduction for Dependents Final return of decedent, Decedent's final return. Tax planning us 1040ez Married filing separately One spouse has itemized, Persons not eligible for the standard deduction. Tax planning us 1040ez Starting date, annuity, Cost. Tax planning us 1040ez State fund for victims of crime, Payments from a state fund for victims of crime. Tax planning us 1040ez Substantial gainful activity, Substantial gainful activity. Tax planning us 1040ez Surrender of Iife insurance, Surrender of policy for cash. Tax planning us 1040ez Surviving Spouse, Reminders Surviving spouse, Surviving spouse. Tax planning us 1040ez Surviving spouse, insurance, Surviving spouse. Tax planning us 1040ez Survivors of retirees, Survivors of retirees. Tax planning us 1040ez T Tax Early distributions, Tax on Early Distributions Estimated, Tax Withholding and Estimated Tax, Estimated Tax Excess accumulation, Tax on Excess Accumulation Tax counseling for the elderly (TCE), Volunteer Income Tax Assistance and Tax Counseling for the Elderly. Tax planning us 1040ez Tax help, How To Get Tax Help Tax option, 10-year, Lump-sum distributions. Tax planning us 1040ez Tax return preparers, Reminders Taxable income, Taxable and Nontaxable Income Taxation of benefits, Are Any of Your Benefits Taxable? Terminally ill, defined, Terminally or chronically ill defined. Tax planning us 1040ez Total and permanent disability, defined, Permanent and total disability. Tax planning us 1040ez Transportation expenses, Transportation TTY/TDD information, How To Get Tax Help U U. Tax planning us 1040ez S. Tax planning us 1040ez citizen or resident, U. Tax planning us 1040ez S. Tax planning us 1040ez citizen or resident alien. Tax planning us 1040ez Unemployment compensation, Unemployment compensation. Tax planning us 1040ez V Veterans' benefits, Veterans' benefits. Tax planning us 1040ez Viatical settlement, Accelerated Death Benefits Victims of crime, Payments from a state fund for victims of crime. Tax planning us 1040ez Volunteer income tax assistance (VITA), Volunteer Income Tax Assistance and Tax Counseling for the Elderly. Tax planning us 1040ez Volunteer work, Volunteer work. Tax planning us 1040ez W Wages (see Compensation) Winter energy use payments, Payments to reduce cost of winter energy use. Tax planning us 1040ez Withholding Employment tax, Reminders Pensions and annuities, Withholding. Tax planning us 1040ez Workers' compensation, Workers' Compensation Worksheets, social security, Which worksheet to use. Tax planning us 1040ez Prev  Up     Home   More Online Publications
Print - Click this link to Print this page

Uncertain Tax Positions - Schedule UTP

Third Year of Uncertain Tax Position Reporting

The IRS is currently reviewing its third year of returns filed with Schedule UTP. Beginning with Tax Year 2010, Schedule UTP was a new schedule that certain corporations  used to report uncertain tax positions. Additionally, with Announcement 2010-76, the IRS expanded its policy of restraint in connection with its decision to require certain corporations to file Schedule UTP. Directives to LB&I personnel have been issued setting forth the IRS’s planned treatment of these UTPs by examiners and other personnel.

Submit your questions, comments, or concerns regarding Schedule UTP to the IRS. Although individual responses will not be provided, the IRS will consider submissions in efforts to improve Schedule UTP.

Information about UTP Education and Outreach Efforts:

LB&I is undertaking an education and outreach effort regarding Schedule UTP. LB&I will mail letters to inform certain taxpayers that a review of their Schedule UTP determined that one or more of the concise descriptions they provided did not meet the requirements set forth in the Schedule UTP instructions. If the taxpayer has a valid Power of Attorney on file with the IRS, the Power of Attorney will also receive a copy of this letter.

While the letter requires no action by taxpayers regarding their Schedule UTP, taxpayers are advised to ensure that on any future filings of a Schedule UTP, the concise descriptions follow the Schedule UTP Instructions. All returns filed with a Schedule UTP will continue to be subject to a review in LB&I.

Taxpayers with questions about the letter or the concise descriptions are being referred to this WEB Site.

Related Documents:

Date

Document

Document Description or Originator

 

 

Forms

Instructions

2013 Form 1120 Schedule UTP Instructions for Form 1120 Schedule UTP
2012 Form 1120 Schedule UTP Instructions for Form 1120 Schedule UTP
2011 Form 1120 Schedule UTP Instructions for Form 1120 Schedule UTP
2010 Form 1120 Schedule UTP Instructions for Form 1120 Schedule UTP
 
IRS Pronouncements:
09-24-10 Announcement 2010-76, Policy of Restraint and Uncertain Tax Positions Impact of the Policy of Restraint on Uncertain Tax Positions. 
09-24-10 Announcement 2010-75, Reporting of Uncertain Tax Positions Reporting of Uncertain Tax Positions.
04-19-10 Announcement 2010-30 Schedule UTP draft form and instructions.
03-05-10 Announcement 2010-17 Extension for comment request for Uncertain Tax Position reporting requirements.
01-26-10 Announcement 2010-9 Comment request for Uncertain Tax Position reporting requirements.
 
IRS and LB&I Guidance Memorandums:
05-31-13 Guidance for Preparing UTP Concise Descriptions Specific Guidance
11-01-11

UTP Guidance and Procedures for the Field

Cover memo by Commissioner, LB&I    
11-01-11 LB&I Schedule UTP Guidance Specific guidance
08-31-11 UTP Guidance and Procedures for the Compliance Assurance Process (CAP) Program Commissioner, LB&I memo
05-11-11

Centralized Management of LB&I Returns with UTP Schedules

Commissioner, LB&I memo
03-23-11 Uncertain Tax Positions - Modified Policy of Restraint Commissioner, LB&I memo
09-24-10 Directive for LB&I: Reporting of Uncertain Tax Positions Deputy Commissioner, Services and Enforcement
 
Public Statements and Comments by IRS Executives:
03-26-12 IRS Deputy Commissioner, Service and Enforcement Remarks before Tax Executives Institute  Remarks of Steven T. Miller, Deputy Commissioner, Service and Enforcement Internal Revenue Service Before the Tax Executives Institute, Mid Year Conference
09-24-10 IRS Commissioner Shulman Remarks before the American Bar Association, 9/24/2010   
04-12-10 Remarks of IRS Commissioner Shulman at the Tax Executives Institute Mid-Year Meeting   
01-26-10 IR-2010-13 Remarks of IRS Commissioner Doug Shulman to the New York State Bar Association Taxation Section Annual Meeting
 
Other Documents:
02-04-14 UTP Filing Statistics  
03-14-13 Frequently Asked Questions  

 

Page Last Reviewed or Updated: 26-Feb-2014

The Tax Planning Us 1040ez

Tax planning us 1040ez 9. Tax planning us 1040ez   Education Exception to Additional Tax on Early IRA Distributions Table of Contents Introduction Who Is Eligible Figuring the Amount Not Subject to the 10% Tax Reporting Early Distributions Introduction Generally, if you take a distribution from your IRA before you reach age 59½, you must pay a 10% additional tax on the early distribution. Tax planning us 1040ez This applies to any IRA you own, whether it is a traditional IRA (including a SEP-IRA), a Roth IRA, or a SIMPLE IRA. Tax planning us 1040ez The additional tax on an early distribution from a SIMPLE IRA may be as high as 25%. Tax planning us 1040ez See Publication 560, Retirement Plans for Small Business, for information on SEP-IRAs, and Publication 590, for information about all other IRAs. Tax planning us 1040ez However, you can take distributions from your IRAs for qualified higher education expenses without having to pay the 10% additional tax. Tax planning us 1040ez You may owe income tax on at least part of the amount distributed, but you may not have to pay the 10% additional tax. Tax planning us 1040ez Generally, if the taxable part of the distribution is less than or equal to the adjusted qualified education expenses (AQEE), none of the distribution is subject to the additional tax. Tax planning us 1040ez If the taxable part of the distribution is more than the AQEE, only the excess is subject to the additional tax. Tax planning us 1040ez Who Is Eligible You can take a distribution from your IRA before you reach age 59½ and not have to pay the 10% additional tax if, for the year of the distribution, you pay qualified education expenses for: yourself, your spouse, or your or your spouse's child, foster child, adopted child, or descendant of any of them. Tax planning us 1040ez Qualified education expenses. Tax planning us 1040ez   For purposes of the 10% additional tax, these expenses are tuition, fees, books, supplies, and equipment required for enrollment or attendance at an eligible educational institution. Tax planning us 1040ez They also include expenses for special needs services incurred by or for special needs students in connection with their enrollment or attendance. Tax planning us 1040ez   In addition, if the student is at least a half-time student, room and board are qualified education expenses. Tax planning us 1040ez   The expense for room and board qualifies only to the extent that it is not more than the greater of the following two amounts. Tax planning us 1040ez The allowance for room and board, as determined by the eligible educational institution, that was included in the cost of attendance (for federal financial aid purposes) for a particular academic period and living arrangement of the student. Tax planning us 1040ez The actual amount charged if the student is residing in housing owned or operated by the eligible educational institution. Tax planning us 1040ez You will need to contact the eligible educational institution for qualified room and board costs. Tax planning us 1040ez Eligible educational institution. Tax planning us 1040ez   An eligible educational institution is any college, university, vocational school, or other postsecondary educational institution eligible to participate in a student aid program administered by the U. Tax planning us 1040ez S. Tax planning us 1040ez Department of Education. Tax planning us 1040ez It includes virtually all accredited public, nonprofit, and proprietary (privately owned profit-making) postsecondary institutions. Tax planning us 1040ez The educational institution should be able to tell you if it is an eligible educational institution. Tax planning us 1040ez   Certain educational institutions located outside the United States also participate in the U. Tax planning us 1040ez S. Tax planning us 1040ez Department of Education's Federal Student Aid (FSA) programs. Tax planning us 1040ez Half-time student. Tax planning us 1040ez   A student is enrolled “at least half-time” if he or she is enrolled for at least half the full-time academic work load for the course of study the student is pursuing as determined under the standards of the school where the student is enrolled. Tax planning us 1040ez Figuring the Amount Not Subject to the 10% Tax To determine the amount of your distribution that is not subject to the 10% additional tax, first figure your adjusted qualified education expenses. Tax planning us 1040ez You do this by reducing your total qualified education expenses by any tax-free educational assistance, which includes: Expenses used to figure the tax-free portion of distributions from a Coverdell education savings account (ESA) (see Distributions in chapter 7, Coverdell Education Savings Account), The tax-free part of scholarships and fellowships (see Tax-Free Scholarships and Fellowships in chapter 1, Scholarships, Fellowships, Grants, and Tuition Reductions), Pell grants (see Pell Grants and Other Title IV Need-Based Education Grants in chapter 1, Scholarships, Fellowships, Grants, and Tuition Reductions), Veterans' educational assistance (see Veterans' Benefits in chapter 1, Scholarships, Fellowships, Grants, and Tuition Reductions), Employer-provided educational assistance (see chapter 11, Employer-Provided Educational Assistance ), and Any other nontaxable (tax-free) payments (other than gifts or inheritances) received as educational assistance. Tax planning us 1040ez Do not reduce the qualified education expenses by amounts paid with funds the student receives as: Payment for services, such as wages, A loan, A gift, An inheritance given to either the student or the individual making the withdrawal, or A withdrawal from personal savings (including savings from a qualified tuition program (QTP)). Tax planning us 1040ez If your IRA distribution is equal to or less than your adjusted qualified education expenses, you are not subject to the 10% additional tax. Tax planning us 1040ez Example 1. Tax planning us 1040ez In 2013, Erin (age 32) took a year off from teaching to attend graduate school full-time. Tax planning us 1040ez She paid $5,800 of qualified education expenses from the following sources. Tax planning us 1040ez   Employer-provided educational assistance  (tax free) $5,000     Early distribution from IRA (includes $500 taxable earnings) 3,200           Before Erin can determine if she must pay the 10% additional tax on her IRA distribution, she must reduce her total qualified education expenses. Tax planning us 1040ez   Total qualified education expenses $5,800     Minus: Tax-free educational assistance −5,000     Equals: Adjusted qualified  education expenses (AQEE) $ 800   Because Erin's AQEE ($800) are more than the taxable portion of her IRA distribution ($500), she does not have to pay the 10% additional tax on any part of this distribution. Tax planning us 1040ez However, she must include the $500 taxable earnings in her gross income subject to income tax. Tax planning us 1040ez Example 2. Tax planning us 1040ez Assume the same facts as in Example 1 , except that Erin deducted some of the contributions to her IRA, so the taxable part of her early distribution is higher by $1,000. Tax planning us 1040ez This must be included in her income subject to income tax. Tax planning us 1040ez The taxable part of Erin's IRA distribution ($1,000) is larger than her $800 AQEE. Tax planning us 1040ez Therefore, she must pay the 10% additional tax on $200, the taxable part of her distribution ($1,000) that is more than her qualified education expenses ($800). Tax planning us 1040ez She does not have to pay the 10% additional tax on the remaining $800 of her taxable distribution. Tax planning us 1040ez Reporting Early Distributions By January 31, 2014, the payer of your IRA distribution should send you Form 1099-R, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc. Tax planning us 1040ez The information on this form will help you determine how much of your distribution is taxable for income tax purposes and how much is subject to the 10% additional tax. Tax planning us 1040ez If you received an early distribution from your IRA, you must report the taxable earnings on Form 1040, line 15b (Form 1040NR, line 16b). Tax planning us 1040ez Then, if you qualify for an exception for qualified higher education expenses, you must file Form 5329 to show how much, if any, of your early distribution is subject to the 10% additional tax. Tax planning us 1040ez See the Instructions for Form 5329, Part I, for help in completing the form and entering the results on Form 1040 or 1040NR. Tax planning us 1040ez There are many other situations in which Form 5329 is required. Tax planning us 1040ez If, during 2013, you had other distributions from IRAs or qualified retirement plans, or have made excess contributions to certain tax-favored accounts, see the instructions for line 58 (Form 1040) or line 56 (Form 1040NR) to determine if you must file Form 5329. Tax planning us 1040ez Prev  Up  Next   Home   More Online Publications