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Tax Returns 2012

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Tax Returns 2012

Tax returns 2012 10. Tax returns 2012   Retirement Savings Contributions Credit (Saver's Credit) Table of Contents Full-time student. Tax returns 2012 Adjusted gross income. Tax returns 2012 Distributions received by spouse. Tax returns 2012 Testing period. Tax returns 2012 If you or your employer make eligible contributions (defined later) to a retirement plan, you may be able to take a credit of up to $1,000 (up to $2,000 if filing jointly). Tax returns 2012 This credit could reduce the federal income tax you pay dollar for dollar. Tax returns 2012 Can you claim the credit?   If you or your employer make eligible contributions to a retirement plan, you can claim the credit if all of the following apply. Tax returns 2012 You are not under age 18. Tax returns 2012 You are not a full-time student (explained next). Tax returns 2012 No one else, such as your parent(s), claims an exemption for you on their tax return. Tax returns 2012 Your adjusted gross income (defined later) is not more than: $59,000 for 2013 ($60,000 for 2014) if your filing status is married filing jointly, $44,250 for 2013 ($45,000 for 2014) if your filing status is head of household (with qualifying person), or $29,500 for 2013 ($30,000 for 2014) if your filing status is single, married filing separately, or qualifying widow(er) with dependent child. Tax returns 2012 Full-time student. Tax returns 2012   You are a full-time student if, during some part of each of 5 calendar months (not necessarily consecutive) during the calendar year, you are either: A full-time student at a school that has a regular teaching staff, course of study, and regularly enrolled body of students in attendance, or A student taking a full-time, on-farm training course given by either a school that has a regular teaching staff, course of study, and regularly enrolled body of students in attendance, or a state, county, or local government. Tax returns 2012 You are a full-time student if you are enrolled for the number of hours or courses the school considers to be full-time. Tax returns 2012 Adjusted gross income. Tax returns 2012   This is generally the amount on line 38 of your 2013 Form 1040 or line 22 of your 2013 Form 1040A. Tax returns 2012 However, you must add to that amount any exclusion or deduction claimed for the year for: Foreign earned income, Foreign housing costs, Income for bona fide residents of American Samoa, and Income from Puerto Rico. Tax returns 2012 Eligible contributions. Tax returns 2012   These include: Contributions to a traditional or Roth IRA, Elective deferrals, including amounts designated as after-tax Roth contributions, to: A 401(k) plan (including a SIMPLE 401(k)), A section 403(b) annuity, An eligible deferred compensation plan of a state or local government (a governmental 457 plan), A SIMPLE IRA plan, or A salary reduction SEP, and Contributions to a section 501(c)(18) plan. Tax returns 2012 They also include voluntary after-tax employee contributions to a tax-qualified retirement plan or a section 403(b) annuity. Tax returns 2012 For purposes of the credit, an employee contribution will be voluntary as long as it is not required as a condition of employment. Tax returns 2012 Reducing eligible contributions. Tax returns 2012   Reduce your eligible contributions (but not below zero) by the total distributions you received during the testing period (defined later) from any IRA, plan, or annuity included earlier under Eligible contributions. Tax returns 2012 Also reduce your eligible contributions by any distribution from a Roth IRA that is not rolled over, even if the distribution is not taxable. Tax returns 2012      Do not reduce your eligible contributions by any of the following: The portion of any distribution which is not includible in income because it is a trustee-to-trustee transfer or a rollover distribution. Tax returns 2012 Any distribution that is a return of a contribution to an IRA (including a Roth IRA) made during the year for which you claim the credit if: The distribution is made before the due date (including extensions) of your tax return for that year, You do not take a deduction for the contribution, and The distribution includes any income attributable to the contribution. Tax returns 2012 Loans from a qualified employer plan treated as a distribution. Tax returns 2012 Distributions of excess contributions or deferrals (and income attributable to excess contributions and deferrals). Tax returns 2012 Distributions of dividends paid on stock held by an employee stock ownership plan under section 404(k). Tax returns 2012 Distributions from an eligible retirement plan that are converted or rolled over to a Roth IRA. Tax returns 2012 Distributions from a military retirement plan. Tax returns 2012 Distributions received by spouse. Tax returns 2012   Any distributions your spouse receives are treated as received by you if you file a joint return with your spouse both for the year of the distribution and for the year for which you claim the credit. Tax returns 2012 Testing period. Tax returns 2012   The testing period consists of: The year in which you claim the credit, The 2 years before the year in which you claim the credit, and The period after the end of the year in which you claim the credit and before the due date of the return (including extensions) for filing your return for the year in which you claimed the credit. Tax returns 2012 Example. Tax returns 2012 You and your spouse filed joint returns in 2011 and 2012, and plan to do so in 2013 and 2014. Tax returns 2012 You received a taxable distribution from a qualified plan in 2011 and a taxable distribution from an eligible section 457(b) deferred compensation plan in 2012. Tax returns 2012 Your spouse received taxable distributions from a Roth IRA in 2013 and tax-free distributions from a Roth IRA in 2014 before April 15. Tax returns 2012 You made eligible contributions to an IRA in 2013 and you otherwise qualify for this credit. Tax returns 2012 You must reduce the amount of your qualifying contributions in 2013 by the total of the distributions you and your spouse received in 2011, 2012, 2013, and 2014. Tax returns 2012 Maximum eligible contributions. Tax returns 2012   After your contributions are reduced, the maximum annual contribution on which you can base the credit is $2,000 per person. Tax returns 2012 Effect on other credits. Tax returns 2012   The amount of this credit will not change the amount of your refundable tax credits. Tax returns 2012 A refundable tax credit, such as the earned income credit or the additional child tax credit, is an amount that you would receive as a refund even if you did not otherwise owe any taxes. Tax returns 2012 Maximum credit. Tax returns 2012   This is a nonrefundable credit. Tax returns 2012 The amount of the credit in any year cannot be more than the amount of tax that you would otherwise pay (not counting any refundable credits or the adoption credit) in any year. Tax returns 2012 If your tax liability is reduced to zero because of other nonrefundable credits, such as the education credits, then you will not be entitled to this credit. Tax returns 2012 How to figure and report the credit. Tax returns 2012   The amount of the credit you can get is based on the contributions you make and your credit rate. Tax returns 2012 The credit rate can be as low as 10% or as high as 50%. Tax returns 2012 Your credit rate depends on your income and your filing status. Tax returns 2012 See Form 8880, Credit for Qualified Retirement Savings Contributions, to determine your credit rate. Tax returns 2012   The maximum contribution taken into account is $2,000 per person. Tax returns 2012 On a joint return, up to $2,000 is taken into account for each spouse. Tax returns 2012   Figure the credit on Form 8880. Tax returns 2012 Report the credit on line 50 of your Form 1040 or line 32 of your Form 1040A, and attach Form 8880 to your return. Tax returns 2012 Prev  Up  Next   Home   More Online Publications
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The Tax Returns 2012

Tax returns 2012 5. Tax returns 2012   Personal Use of Dwelling Unit (Including Vacation Home) Table of Contents Dividing Expenses Dwelling Unit Used as a HomeMain home. Tax returns 2012 Shared equity financing agreement. Tax returns 2012 Donation of use of the property. Tax returns 2012 Examples. Tax returns 2012 Days used for repairs and maintenance. Tax returns 2012 Days used as a main home before or after renting. Tax returns 2012 Reporting Income and DeductionsNot used as a home. Tax returns 2012 Used as a home but rented less than 15 days. Tax returns 2012 Used as a home and rented 15 days or more. Tax returns 2012 If you have any personal use of a dwelling unit (including a vacation home) that you rent, you must divide your expenses between rental use and personal use. Tax returns 2012 In general, your rental expenses will be no more than your total expenses multiplied by a fraction; the denominator of which is the total number of days the dwelling unit is used and the numerator of which is the total number of days actually rented at a fair rental price. Tax returns 2012 Only your rental expenses may deducted on Schedule E (Form 1040). Tax returns 2012 Some of your personal expenses may be deductible if you itemize your deductions on Schedule A (Form 1040). Tax returns 2012 You must also determine if the dwelling unit is considered a home. Tax returns 2012 The amount of rental expenses that you can deduct may be limited if the dwelling unit is considered a home. Tax returns 2012 Whether a dwelling unit is considered a home depends on how many days during the year are considered to be days of personal use. Tax returns 2012 There is a special rule if you used the dwelling unit as a home and you rented it for less than 15 days during the year. Tax returns 2012 Dwelling unit. Tax returns 2012   A dwelling unit includes a house, apartment, condominium, mobile home, boat, vacation home, or similar property. Tax returns 2012 It also includes all structures or other property belonging to the dwelling unit. Tax returns 2012 A dwelling unit has basic living accommodations, such as sleeping space, a toilet, and cooking facilities. Tax returns 2012   A dwelling unit does not include property (or part of the property) used solely as a hotel, motel, inn, or similar establishment. Tax returns 2012 Property is used solely as a hotel, motel, inn, or similar establishment if it is regularly available for occupancy by paying customers and is not used by an owner as a home during the year. Tax returns 2012 Example. Tax returns 2012 You rent a room in your home that is always available for short-term occupancy by paying customers. Tax returns 2012 You do not use the room yourself and you allow only paying customers to use the room. Tax returns 2012 This room is used solely as a hotel, motel, inn, or similar establishment and is not a dwelling unit. Tax returns 2012 Dividing Expenses If you use a dwelling unit for both rental and personal purposes, divide your expenses between the rental use and the personal use based on the number of days used for each purpose. Tax returns 2012 When dividing your expenses, follow these rules. Tax returns 2012 Any day that the unit is rented at a fair rental price is a day of rental use even if you used the unit for personal purposes that day. Tax returns 2012 (This rule does not apply when determining whether you used the unit as a home. Tax returns 2012 ) Any day that the unit is available for rent but not actually rented is not a day of rental use. Tax returns 2012 Fair rental price. Tax returns 2012   A fair rental price for your property generally is the amount of rent that a person who is not related to you would be willing to pay. Tax returns 2012 The rent you charge is not a fair rental price if it is substantially less than the rents charged for other properties that are similar to your property in your area. Tax returns 2012   Ask yourself the following questions when comparing another property with yours. Tax returns 2012 Is it used for the same purpose? Is it approximately the same size? Is it in approximately the same condition? Does it have similar furnishings? Is it in a similar location? If any of the answers are no, the properties probably are not similar. Tax returns 2012 Example. Tax returns 2012 Your beach cottage was available for rent from June 1 through August 31 (92 days). Tax returns 2012 Except for the first week in August (7 days), when you were unable to find a renter, you rented the cottage at a fair rental price during that time. Tax returns 2012 The person who rented the cottage for July allowed you to use it over the weekend (2 days) without any reduction in or refund of rent. Tax returns 2012 Your family also used the cottage during the last 2 weeks of May (14 days). Tax returns 2012 The cottage was not used at all before May 17 or after August 31. Tax returns 2012 You figure the part of the cottage expenses to treat as rental expenses as follows. Tax returns 2012 The cottage was used for rental a total of 85 days (92 − 7). Tax returns 2012 The days it was available for rent but not rented (7 days) are not days of rental use. Tax returns 2012 The July weekend (2 days) you used it is rental use because you received a fair rental price for the weekend. Tax returns 2012 You used the cottage for personal purposes for 14 days (the last 2 weeks in May). Tax returns 2012 The total use of the cottage was 99 days (14 days personal use + 85 days rental use). Tax returns 2012 Your rental expenses are 85/99 (86%) of the cottage expenses. Tax returns 2012 Note. Tax returns 2012 When determining whether you used the cottage as a home, the July weekend (2 days) you used it is considered personal use even though you received a fair rental price for the weekend. Tax returns 2012 Therefore, you had 16 days of personal use and 83 days of rental use for this purpose. Tax returns 2012 Because you used the cottage for personal purposes more than 14 days and more than 10% of the days of rental use (8 days), you used it as a home. Tax returns 2012 If you have a net loss, you may not be able to deduct all of the rental expenses. Tax returns 2012 See Dwelling Unit Used as a Home, next. Tax returns 2012 Dwelling Unit Used as a Home If you use a dwelling unit for both rental and personal purposes, the tax treatment of the rental expenses you figured earlier under Dividing Expenses and rental income depends on whether you are considered to be using the dwelling unit as a home. Tax returns 2012 You use a dwelling unit as a home during the tax year if you use it for personal purposes more than the greater of: 14 days, or 10% of the total days it is rented to others at a fair rental price. Tax returns 2012 See What is a day of personal use , later. Tax returns 2012 If a dwelling unit is used for personal purposes on a day it is rented at a fair rental price (discussed earlier), do not count that day as a day of rental use in applying (2) above. Tax returns 2012 Instead, count it as a day of personal use in applying both (1) and (2) above. Tax returns 2012 What is a day of personal use?   A day of personal use of a dwelling unit is any day that the unit is used by any of the following persons. Tax returns 2012 You or any other person who owns an interest in it, unless you rent it to another owner as his or her main home under a shared equity financing agreement (defined later). Tax returns 2012 However, see Days used as a main home before or after renting , later. Tax returns 2012 A member of your family or a member of the family of any other person who owns an interest in it, unless the family member uses the dwelling unit as his or her main home and pays a fair rental price. Tax returns 2012 Family includes only your spouse, brothers and sisters, half-brothers and half-sisters, ancestors (parents, grandparents, etc. Tax returns 2012 ), and lineal descendants (children, grandchildren, etc. Tax returns 2012 ). Tax returns 2012 Anyone under an arrangement that lets you use some other dwelling unit. Tax returns 2012 Anyone at less than a fair rental price. Tax returns 2012 Main home. Tax returns 2012   If the other person or member of the family in (1) or (2) above has more than one home, his or her main home is ordinarily the one he or she lived in most of the time. Tax returns 2012 Shared equity financing agreement. Tax returns 2012   This is an agreement under which two or more persons acquire undivided interests for more than 50 years in an entire dwelling unit, including the land, and one or more of the co-owners is entitled to occupy the unit as his or her main home upon payment of rent to the other co-owner or owners. Tax returns 2012 Donation of use of the property. Tax returns 2012   You use a dwelling unit for personal purposes if: You donate the use of the unit to a charitable organization, The organization sells the use of the unit at a fund-raising event, and The “purchaser” uses the unit. Tax returns 2012 Examples. Tax returns 2012   The following examples show how to determine if you have days of personal use. Tax returns 2012 Example 1. Tax returns 2012 You and your neighbor are co-owners of a condominium at the beach. Tax returns 2012 Last year, you rented the unit to vacationers whenever possible. Tax returns 2012 The unit was not used as a main home by anyone. Tax returns 2012 Your neighbor used the unit for 2 weeks last year; you did not use it at all. Tax returns 2012 Because your neighbor has an interest in the unit, both of you are considered to have used the unit for personal purposes during those 2 weeks. Tax returns 2012 Example 2. Tax returns 2012 You and your neighbors are co-owners of a house under a shared equity financing agreement. Tax returns 2012 Your neighbors live in the house and pay you a fair rental price. Tax returns 2012 Even though your neighbors have an interest in the house, the days your neighbors live there are not counted as days of personal use by you. Tax returns 2012 This is because your neighbors rent the house as their main home under a shared equity financing agreement. Tax returns 2012 Example 3. Tax returns 2012 You own a rental property that you rent to your son. Tax returns 2012 Your son does not own any interest in this property. Tax returns 2012 He uses it as his main home and pays you a fair rental price. Tax returns 2012 Your son's use of the property is not personal use by you because your son is using it as his main home, he owns no interest in the property, and he is paying you a fair rental price. Tax returns 2012 Example 4. Tax returns 2012 You rent your beach house to Rosa. Tax returns 2012 Rosa rents her cabin in the mountains to you. Tax returns 2012 You each pay a fair rental price. Tax returns 2012 You are using your beach house for personal purposes on the days that Rosa uses it because your house is used by Rosa under an arrangement that allows you to use her cabin. Tax returns 2012 Example 5. Tax returns 2012 You rent an apartment to your mother at less than a fair rental price. Tax returns 2012 You are using the apartment for personal purposes on the days that your mother rents it because you rent it for less than a fair rental price. Tax returns 2012 Days used for repairs and maintenance. Tax returns 2012   Any day that you spend working substantially full time repairing and maintaining (not improving) your property is not counted as a day of personal use. Tax returns 2012 Do not count such a day as a day of personal use even if family members use the property for recreational purposes on the same day. Tax returns 2012 Example. Tax returns 2012 Corey owns a cabin in the mountains that he rents for most of the year. Tax returns 2012 He spends a week at the cabin with family members. Tax returns 2012 Corey works on maintenance of the cabin 3 or 4 hours each day during the week and spends the rest of the time fishing, hiking, and relaxing. Tax returns 2012 Corey's family members, however, work substantially full time on the cabin each day during the week. Tax returns 2012 The main purpose of being at the cabin that week is to do maintenance work. Tax returns 2012 Therefore, the use of the cabin during the week by Corey and his family will not be considered personal use by Corey. Tax returns 2012 Days used as a main home before or after renting. Tax returns 2012   For purposes of determining whether a dwelling unit was used as a home, you may not have to count days you used the property as your main home before or after renting it or offering it for rent as days of personal use. Tax returns 2012 Do not count them as days of personal use if: You rented or tried to rent the property for 12 or more consecutive months. Tax returns 2012 You rented or tried to rent the property for a period of less than 12 consecutive months and the period ended because you sold or exchanged the property. Tax returns 2012 However, this special rule does not apply when dividing expenses between rental and personal use. Tax returns 2012 See Property Changed to Rental Use in chapter 4. Tax returns 2012 Example 1. Tax returns 2012 On February 29, 2012, you moved out of the house you had lived in for 6 years because you accepted a job in another town. Tax returns 2012 You rented your house at a fair rental price from March 15, 2012, to May 14, 2013 (14 months). Tax returns 2012 On June 1, 2013, you moved back into your old house. Tax returns 2012 The days you used the house as your main home from January 1 to February 29, 2012, and from June 1 to December 31, 2013, are not counted as days of personal use. Tax returns 2012 Therefore, you would use the rules in chapter 1 when figuring your rental income and expenses. Tax returns 2012 Example 2. Tax returns 2012 On January 31, you moved out of the condominium where you had lived for 3 years. Tax returns 2012 You offered it for rent at a fair rental price beginning on February 1. Tax returns 2012 You were unable to rent it until April. Tax returns 2012 On September 15, you sold the condominium. Tax returns 2012 The days you used the condominium as your main home from January 1 to January 31 are not counted as days of personal use when determining whether you used it as a home. Tax returns 2012 Examples. Tax returns 2012   The following examples show how to determine whether you used your rental property as a home. Tax returns 2012 Example 1. Tax returns 2012 You converted the basement of your home into an apartment with a bedroom, a bathroom, and a small kitchen. Tax returns 2012 You rented the basement apartment at a fair rental price to college students during the regular school year. Tax returns 2012 You rented to them on a 9-month lease (273 days). Tax returns 2012 You figured 10% of the total days rented to others at a fair rental price is 27 days. Tax returns 2012 During June (30 days), your brothers stayed with you and lived in the basement apartment rent free. Tax returns 2012 Your basement apartment was used as a home because you used it for personal purposes for 30 days. Tax returns 2012 Rent-free use by your brothers is considered personal use. Tax returns 2012 Your personal use (30 days) is more than the greater of 14 days or 10% of the total days it was rented (27 days). Tax returns 2012 Example 2. Tax returns 2012 You rented the guest bedroom in your home at a fair rental price during the local college's homecoming, commencement, and football weekends (a total of 27 days). Tax returns 2012 Your sister-in-law stayed in the room, rent free, for the last 3 weeks (21 days) in July. Tax returns 2012 You figured 10% of the total days rented to others at a fair rental price is 3 days. Tax returns 2012 The room was used as a home because you used it for personal purposes for 21 days. Tax returns 2012 That is more than the greater of 14 days or 10% of the 27 days it was rented (3 days). Tax returns 2012 Example 3. Tax returns 2012 You own a condominium apartment in a resort area. Tax returns 2012 You rented it at a fair rental price for a total of 170 days during the year. Tax returns 2012 For 12 of these days, the tenant was not able to use the apartment and allowed you to use it even though you did not refund any of the rent. Tax returns 2012 Your family actually used the apartment for 10 of those days. Tax returns 2012 Therefore, the apartment is treated as having been rented for 160 (170 – 10) days. Tax returns 2012 You figured 10% of the total days rented to others at a fair rental price is 16 days. Tax returns 2012 Your family also used the apartment for 7 other days during the year. Tax returns 2012 You used the apartment as a home because you used it for personal purposes for 17 days. Tax returns 2012 That is more than the greater of 14 days or 10% of the 160 days it was rented (16 days). Tax returns 2012 Minimal rental use. Tax returns 2012   If you use the dwelling unit as a home and you rent it less than 15 days during the year, that period is not treated as rental activity. Tax returns 2012 See Used as a home but rented less than 15 days, later, for more information. Tax returns 2012 Limit on deductions. Tax returns 2012   Renting a dwelling unit that is considered a home is not a passive activity. Tax returns 2012 Instead, if your rental expenses are more than your rental income, some or all of the excess expenses cannot be used to offset income from other sources. Tax returns 2012 The excess expenses that cannot be used to offset income from other sources are carried forward to the next year and treated as rental expenses for the same property. Tax returns 2012 Any expenses carried forward to the next year will be subject to any limits that apply for that year. Tax returns 2012 This limitation will apply to expenses carried forward to another year even if you do not use the property as your home for that subsequent year. Tax returns 2012   To figure your deductible rental expenses for this year and any carryover to next year, use Worksheet 5–1. Tax returns 2012 Reporting Income and Deductions Property not used for personal purposes. Tax returns 2012   If you do not use a dwelling unit for personal purposes, see chapter 3 for how to report your rental income and expenses. Tax returns 2012 Property used for personal purposes. Tax returns 2012   If you do use a dwelling unit for personal purposes, then how you report your rental income and expenses depends on whether you used the dwelling unit as a home. Tax returns 2012 Not used as a home. Tax returns 2012   If you use a dwelling unit for personal purposes, but not as a home, report all the rental income in your income. Tax returns 2012 Since you used the dwelling unit for personal purposes, you must divide your expenses between the rental use and the personal use as described earlier in this chapter under Dividing Expenses . Tax returns 2012 The expenses for personal use are not deductible as rental expenses. Tax returns 2012   Your deductible rental expenses can be more than your gross rental income; however, see Limits on Rental Losses in chapter 3. Tax returns 2012 Used as a home but rented less than 15 days. Tax returns 2012   If you use a dwelling unit as a home and you rent it less than 15 days during the year, its primary function is not considered to be rental and it should not be reported on Schedule E (Form 1040). Tax returns 2012 You are not required to report the rental income and rental expenses from this activity. Tax returns 2012 The expenses, including qualified mortgage interest, property taxes, and any qualified casualty loss will be reported as normally allowed on Schedule A (Form 1040). Tax returns 2012 See the Instructions for Schedule A (Form 1040) for more information on deducting these expenses. Tax returns 2012 Used as a home and rented 15 days or more. Tax returns 2012   If you use a dwelling unit as a home and rent it 15 days or more during the year, include all your rental income in your income. Tax returns 2012 Since you used the dwelling unit for personal purposes, you must divide your expenses between the rental use and the personal use as described earlier in this chapter under Dividing Expenses . Tax returns 2012 The expenses for personal use are not deductible as rental expenses. Tax returns 2012   If you had a net profit from renting the dwelling unit for the year (that is, if your rental income is more than the total of your rental expenses, including depreciation), deduct all of your rental expenses. Tax returns 2012 You do not need to use Worksheet 5-1. Tax returns 2012   However, if you had a net loss from renting the dwelling unit for the year, your deduction for certain rental expenses is limited. Tax returns 2012 To figure your deductible rental expenses and any carryover to next year, use Worksheet 5–1. Tax returns 2012 Worksheet 5-1. Tax returns 2012 Worksheet for Figuring Rental Deductions for a Dwelling Unit Used as a Home Use this worksheet only if you answer “yes” to all of the following questions. Tax returns 2012 Did you use the dwelling unit as a home this year? (See Dwelling Unit Used as a Home . Tax returns 2012 ) Did you rent the dwelling unit at a fair rental price 15 days or more this year? Is the total of your rental expenses and depreciation more than your rental income? PART I. Tax returns 2012 Rental Use Percentage A. Tax returns 2012 Total days available for rent at fair rental price A. Tax returns 2012       B. Tax returns 2012 Total days available for rent (line A) but not rented B. Tax returns 2012       C. Tax returns 2012 Total days of rental use. Tax returns 2012 Subtract line B from line A C. Tax returns 2012       D. Tax returns 2012 Total days of personal use (including days rented at less than fair rental price) D. Tax returns 2012       E. Tax returns 2012 Total days of rental and personal use. Tax returns 2012 Add lines C and D E. Tax returns 2012       F. Tax returns 2012 Percentage of expenses allowed for rental. Tax returns 2012 Divide line C by line E     F. Tax returns 2012 . Tax returns 2012 PART II. Tax returns 2012 Allowable Rental Expenses 1. Tax returns 2012 Enter rents received 1. Tax returns 2012   2a. Tax returns 2012 Enter the rental portion of deductible home mortgage interest and qualified mortgage insurance premiums (see instructions) 2a. Tax returns 2012       b. Tax returns 2012 Enter the rental portion of real estate taxes b. Tax returns 2012       c. Tax returns 2012 Enter the rental portion of deductible casualty and theft losses (see instructions) c. Tax returns 2012       d. Tax returns 2012 Enter direct rental expenses (see instructions) d. Tax returns 2012       e. Tax returns 2012 Fully deductible rental expenses. Tax returns 2012 Add lines 2a–2d. Tax returns 2012 Enter here and  on the appropriate lines on Schedule E (see instructions) 2e. Tax returns 2012   3. Tax returns 2012 Subtract line 2e from line 1. Tax returns 2012 If zero or less, enter -0- 3. Tax returns 2012   4a. Tax returns 2012 Enter the rental portion of expenses directly related to operating or maintaining  the dwelling unit (such as repairs, insurance, and utilities) 4a. Tax returns 2012       b. Tax returns 2012 Enter the rental portion of excess mortgage interest and qualified mortgage insurance premiums (see instructions) b. Tax returns 2012       c. Tax returns 2012 Carryover of operating expenses from 2012 worksheet c. Tax returns 2012       d. Tax returns 2012 Add lines 4a–4c d. Tax returns 2012       e. Tax returns 2012 Allowable expenses. Tax returns 2012 Enter the smaller of line 3 or line 4d (see instructions) 4e. Tax returns 2012   5. Tax returns 2012 Subtract line 4e from line 3. Tax returns 2012 If zero or less, enter -0- 5. Tax returns 2012   6a. Tax returns 2012 Enter the rental portion of excess casualty and theft losses (see instructions) 6a. Tax returns 2012       b. Tax returns 2012 Enter the rental portion of depreciation of the dwelling unit b. Tax returns 2012       c. Tax returns 2012 Carryover of excess casualty losses and depreciation from 2012 worksheet c. Tax returns 2012       d. Tax returns 2012 Add lines 6a–6c d. Tax returns 2012       e. Tax returns 2012 Allowable excess casualty and theft losses and depreciation. Tax returns 2012 Enter the smaller of  line 5 or line 6d (see instructions) 6e. Tax returns 2012   PART III. Tax returns 2012 Carryover of Unallowed Expenses to Next Year 7a. Tax returns 2012 Operating expenses to be carried over to next year. Tax returns 2012 Subtract line 4e from line 4d 7a. Tax returns 2012   b. Tax returns 2012 Excess casualty and theft losses and depreciation to be carried over to next year. Tax returns 2012  Subtract line 6e from line 6d b. Tax returns 2012   Worksheet 5-1 Instructions. Tax returns 2012 Worksheet for Figuring Rental Deductions for a Dwelling Unit Used as a Home Caution. Tax returns 2012 Use the percentage determined in Part I, line F, to figure the rental portions to enter on lines 2a–2c, 4a–4b, and 6a–6b of  Part II. Tax returns 2012 Line 2a. Tax returns 2012 Figure the mortgage interest on the dwelling unit that you could deduct on Schedule A as if you had not rented the unit. Tax returns 2012 Do not include interest on a loan that did not benefit the dwelling unit. Tax returns 2012 For example, do not include interest on a home equity loan used to pay off credit cards or other personal loans, buy a car, or pay college tuition. Tax returns 2012 Include interest on a loan used to buy, build, or improve the dwelling unit, or to refinance such a loan. Tax returns 2012 Include the rental portion of this interest in the total you enter on line 2a of the worksheet. Tax returns 2012   Figure the qualified mortgage insurance premiums on the dwelling unit that you could deduct on line 13 of Schedule A as if you had not rented the unit. Tax returns 2012 See the Schedule A instructions. Tax returns 2012 However, figure your adjusted gross income (Form 1040, line 38) without your rental income and expenses from the dwelling unit. Tax returns 2012 See Line 4b to deduct the part of the qualified mortgage insurance premiums not allowed because of the adjusted gross income limit. Tax returns 2012 Include the rental portion of the amount from Schedule A, line 13, in the total you enter on line 2a of the worksheet. Tax returns 2012   Note. Tax returns 2012 Do not file this Schedule A or use it to figure the amount to deduct on line 13 of that schedule. Tax returns 2012 Instead, figure the personal portion on a separate Schedule A. Tax returns 2012 If you have deducted mortgage interest or qualified mortgage insurance premiums on the dwelling unit on other forms, such as Schedule C or F, remember to reduce your Schedule A deduction by that amount. Tax returns 2012           Line 2c. Tax returns 2012 Figure the casualty and theft losses related to the dwelling unit that you could deduct on Schedule A as if you had not rented the dwelling unit. Tax returns 2012 To do this, complete Section A of Form 4684, Casualties and Thefts, treating the losses as personal losses. Tax returns 2012 If any of the loss is due to a federally declared disaster, see the Instructions for Form 4684. Tax returns 2012 On Form 4684, line 17, enter 10% of your adjusted gross income figured without your rental income and expenses from the dwelling unit. Tax returns 2012 Enter the rental portion of the result from Form 4684, line 18, on line 2c of this worksheet. Tax returns 2012   Note. Tax returns 2012 Do not file this Form 4684 or use it to figure your personal losses on Schedule A. Tax returns 2012 Instead, figure the personal portion on a separate Form 4684. Tax returns 2012           Line 2d. Tax returns 2012 Enter the total of your rental expenses that are directly related only to the rental activity. Tax returns 2012 These include interest on loans used for rental activities other than to buy, build, or improve the dwelling unit. Tax returns 2012 Also include rental agency fees, advertising, office supplies, and depreciation on office equipment used in your rental activity. Tax returns 2012           Line 2e. Tax returns 2012 You can deduct the amounts on lines 2a, 2b, 2c, and 2d as rental expenses on Schedule E even if your rental expenses are more than your rental income. Tax returns 2012 Enter the amounts on lines 2a, 2b, 2c, and 2d on the appropriate lines of Schedule E. Tax returns 2012           Line 4b. Tax returns 2012 On line 2a, you entered the rental portion of the mortgage interest or qualified mortgage insurance premiums you could deduct on Schedule A if you had not rented the dwelling unit. Tax returns 2012 If you had additional mortgage interest and qualified mortgage insurance premiums that would not be deductible on Schedule A because of limits imposed on them, enter on line 4b of this worksheet the rental portion of those excess amounts. Tax returns 2012 Do not include interest on a loan that did not benefit the dwelling unit  (as explained in the line 2a instructions). Tax returns 2012           Line 4e. Tax returns 2012 You can deduct the amounts on lines 4a, 4b, and 4c as rental expenses on Schedule E only to the extent they are not more than the amount on line 4e. Tax returns 2012 *           Line 6a. Tax returns 2012 To find the rental portion of excess casualty and theft losses, use the Form 4684 you prepared for line 2c of this worksheet. Tax returns 2012   A. Tax returns 2012 Enter the amount from Form 4684, line 10       B. Tax returns 2012 Enter the rental portion of line A       C. Tax returns 2012 Enter the amount from line 2c of this worksheet       D. Tax returns 2012 Subtract line C from line B. Tax returns 2012 Enter the result here and on line 6a of this worksheet               Line 6e. Tax returns 2012 You can deduct the amounts on lines 6a, 6b, and 6c as rental expenses on Schedule E only to the extent they are not more than the amount on line 6e. Tax returns 2012 * *Allocating the limited deduction. Tax returns 2012 If you cannot deduct all of the amount on line 4d or 6d this year, you can allocate the allowable deduction in any way you wish among the expenses included on line 4d or 6d. Tax returns 2012 Enter the amount you allocate to each expense on the appropriate line of Schedule E, Part I. Tax returns 2012 Prev  Up  Next   Home   More Online Publications