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Www irs gov freefile com 8. Www irs gov freefile com   Qualified Tuition Program (QTP) Table of Contents Introduction What Is a Qualified Tuition ProgramDesignated beneficiary. Www irs gov freefile com Half-time student. Www irs gov freefile com How Much Can You Contribute Are Distributions TaxableFiguring the Taxable Portion of a Distribution Additional Tax on Taxable Distributions Rollovers and Other TransfersRollovers Changing the Designated Beneficiary Introduction Qualified tuition programs (QTPs) are also called “529 plans. Www irs gov freefile com ” States may establish and maintain programs that allow you to either prepay or contribute to an account for paying a student's qualified education expenses at a postsecondary institution. Www irs gov freefile com Eligible educational institutions may establish and maintain programs that allow you to prepay a student's qualified education expenses. Www irs gov freefile com If you prepay tuition, the student (designated beneficiary) will be entitled to a waiver or a payment of qualified education expenses. Www irs gov freefile com You cannot deduct either payments or contributions to a QTP. Www irs gov freefile com For information on a specific QTP, you will need to contact the state agency or eligible educational institution that established and maintains it. Www irs gov freefile com What is the tax benefit of a QTP. Www irs gov freefile com   No tax is due on a distribution from a QTP unless the amount distributed is greater than the beneficiary's adjusted qualified education expenses. Www irs gov freefile com See Are Distributions Taxable , later, for more information. Www irs gov freefile com    Even if a QTP is used to finance a student's education, the student or the student's parents still may be eligible to claim the American opportunity credit or the lifetime learning credit. Www irs gov freefile com See Coordination With American Opportunity and Lifetime Learning Credits, later. Www irs gov freefile com What Is a Qualified Tuition Program A qualified tuition program is a program set up to allow you to either prepay, or contribute to an account established for paying, a student's qualified education expenses at an eligible educational institution. Www irs gov freefile com QTPs can be established and maintained by states (or agencies or instrumentalities of a state) and eligible educational institutions. Www irs gov freefile com The program must meet certain requirements. Www irs gov freefile com Your state government or the eligible educational institution in which you are interested can tell you whether or not they participate in a QTP. Www irs gov freefile com Qualified education expenses. Www irs gov freefile com   These are expenses related to enrollment or attendance at an Eligible educational institution (defined later). Www irs gov freefile com As shown in the following list, to be qualified, some of the expenses must be required by the institution and some must be incurred by students who are enrolled at least half-time. Www irs gov freefile com See Half-time student , later. Www irs gov freefile com The following expenses must be required for enrollment or attendance of a Designated beneficiary (defined later) at an eligible educational institution. Www irs gov freefile com Tuition and fees. Www irs gov freefile com Books, supplies, and equipment. Www irs gov freefile com Expenses for special needs services needed by a special needs beneficiary must be incurred in connection with enrollment or attendance at an eligible educational institution. Www irs gov freefile com Expenses for room and board must be incurred by students who are enrolled at least half-time. Www irs gov freefile com The expense for room and board qualifies only to the extent that it is not more than the greater of the following two amounts. Www irs gov freefile com 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. Www irs gov freefile com The actual amount charged if the student is residing in housing owned or operated by the eligible educational institution. Www irs gov freefile com You will need to contact the eligible educational institution for qualified room and board costs. Www irs gov freefile com    For tax years after 2010, the purchase of computer technology or equipment is only a qualified education expense if the computer technology or equipment is required for enrollment or attendance at an eligible institution. Www irs gov freefile com Designated beneficiary. Www irs gov freefile com   The designated beneficiary is generally the student (or future student) for whom the QTP is intended to provide benefits. Www irs gov freefile com The designated beneficiary can be changed after participation in the QTP begins. Www irs gov freefile com If a state or local government or certain tax-exempt organizations purchase an interest in a QTP as part of a scholarship program, the designated beneficiary is the person who receives the interest as a scholarship. Www irs gov freefile com Half-time student. Www irs gov freefile com   A student is enrolled “at least half-time” if he or she is enrolled for at least half the full-time academic workload for the course of study the student is pursuing, as determined under the standards of the school where the student is enrolled. Www irs gov freefile com Eligible educational institution. Www irs gov freefile com   For purposes of a QTP, this is any college, university, vocational school, or other postsecondary educational institution eligible to participate in a student aid program administered by the U. Www irs gov freefile com S. Www irs gov freefile com Department of Education. Www irs gov freefile com It includes virtually all accredited public, nonprofit, and proprietary (privately owned profit-making) postsecondary institutions. Www irs gov freefile com The educational institution should be able to tell you if it is an eligible educational institution. Www irs gov freefile com   Certain educational institutions located outside the United States also participate in the U. Www irs gov freefile com S. Www irs gov freefile com Department of Education's Federal Student Aid (FSA) programs. Www irs gov freefile com   How Much Can You Contribute Contributions to a QTP on behalf of any beneficiary cannot be more than the amount necessary to provide for the qualified education expenses of the beneficiary. Www irs gov freefile com There are no income restrictions on the individual contributors. Www irs gov freefile com You can contribute to both a QTP and a Coverdell ESA in the same year for the same designated beneficiary. Www irs gov freefile com   Are Distributions Taxable The part of a distribution representing the amount paid or contributed to a QTP does not have to be included in income. Www irs gov freefile com This is a return of the investment in the plan. Www irs gov freefile com The designated beneficiary generally does not have to include in income any earnings distributed from a QTP if the total distribution is less than or equal to adjusted qualified education expenses (defined under Figuring the Taxable Portion of a Distribution , later). Www irs gov freefile com Earnings and return of investment. Www irs gov freefile com    You will receive a Form 1099-Q, from each of the programs from which you received a QTP distribution in 2013. Www irs gov freefile com The amount of your gross distribution (box 1) shown on each form will be divided between your earnings (box 2) and your basis, or return of investment (box 3). Www irs gov freefile com Form 1099-Q should be sent to you by January 31, 2014. Www irs gov freefile com Figuring the Taxable Portion of a Distribution To determine if total distributions for the year are more or less than the amount of qualified education expenses, you must compare the total of all QTP distributions for the tax year to the adjusted qualified education expenses. Www irs gov freefile com Adjusted qualified education expenses. Www irs gov freefile com   This amount is the total qualified education expenses reduced by any tax-free educational assistance. Www irs gov freefile com Tax-free educational assistance includes: The tax-free part of scholarships and fellowships (see Tax-Free Scholarships and Fellowships in chapter 1, Scholarships, Fellowships, Grants, and Tuition Reductions), Veterans' educational assistance (see Veterans' Benefits 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), 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. Www irs gov freefile com Taxable earnings. Www irs gov freefile com   Use the following steps to figure the taxable part. Www irs gov freefile com Multiply the total distributed earnings shown in box 2 of Form 1099-Q by a fraction. Www irs gov freefile com The numerator is the adjusted qualified education expenses paid during the year and the denominator is the total amount distributed during the year. Www irs gov freefile com Subtract the amount figured in (1) from the total distributed earnings. Www irs gov freefile com The result is the amount the beneficiary must include in income. Www irs gov freefile com Report it on Form 1040 or Form 1040NR, line 21. Www irs gov freefile com Example 1. Www irs gov freefile com In 2007, Sara Clarke's parents opened a savings account for her with a QTP maintained by their state government. Www irs gov freefile com Over the years they contributed $18,000 to the account. Www irs gov freefile com The total balance in the account was $27,000 on the date the distribution was made. Www irs gov freefile com In the summer of 2013, Sara enrolled in college and had $8,300 of qualified education expenses for the rest of the year. Www irs gov freefile com She paid her college expenses from the following sources. Www irs gov freefile com   Gift from parents $1,600     Partial tuition scholarship (tax-free) 3,100     QTP distribution 5,300           Before Sara can determine the taxable part of her QTP distribution, she must reduce her total qualified education expenses by any tax-free educational assistance. Www irs gov freefile com   Total qualified education expenses $8,300     Minus: Tax-free educational assistance −3,100     Equals: Adjusted qualified  education expenses (AQEE) $5,200   Since the remaining expenses ($5,200) are less than the QTP distribution, part of the earnings will be taxable. Www irs gov freefile com Sara's Form 1099-Q shows that $950 of the QTP distribution is earnings. Www irs gov freefile com Sara figures the taxable part of the distributed earnings as follows. Www irs gov freefile com   1. Www irs gov freefile com $950 (earnings) × $5,200 AQEE  $5,300 distribution           =$932 (tax-free earnings)     2. Www irs gov freefile com $950 (earnings)−$932 (tax-free earnings)     =$18 (taxable earnings)  Sara must include $18 in income (Form 1040, line 21) as distributed QTP earnings not used for adjusted qualified education expenses. Www irs gov freefile com Coordination With American Opportunity and Lifetime Learning Credits An American opportunity or lifetime learning credit (education credit) can be claimed in the same year the beneficiary takes a tax-free distribution from a QTP, as long as the same expenses are not used for both benefits. Www irs gov freefile com This means that after the beneficiary reduces qualified education expenses by tax-free educational assistance, he or she must further reduce them by the expenses taken into account in determining the credit. Www irs gov freefile com Example 2. Www irs gov freefile com Assume the same facts as in Example 1 , except that Sara's parents claimed an American opportunity credit of $2,500 (based on $4,000 expenses). Www irs gov freefile com   Total qualified education expenses $8,300     Minus: Tax-free educational assistance −3,100     Minus: Expenses taken into account  in figuring American opportunity credit −4,000     Equals: Adjusted qualified  education expenses (AQEE) $1,200           The taxable part of the distribution is figured as follows. Www irs gov freefile com   1. Www irs gov freefile com $950 (earnings) × $1,200 AQEE  $5,300 distribution           =$215 (tax-free earnings)     2. Www irs gov freefile com $950 (earnings)−$215 (tax-free earnings)     =$735 (taxable earnings)       Sara must include $735 in income (Form 1040, line 21). Www irs gov freefile com This represents distributed earnings not used for adjusted qualified education expenses. Www irs gov freefile com Coordination With Coverdell ESA Distributions If a designated beneficiary receives distributions from both a QTP and a Coverdell ESA in the same year, and the total of these distributions is more than the beneficiary's adjusted qualified higher education expenses, the expenses must be allocated between the distributions. Www irs gov freefile com For purposes of this allocation, disregard any qualified elementary and secondary education expenses. Www irs gov freefile com Example 3. Www irs gov freefile com Assume the same facts as in Example 2 , except that instead of receiving a $5,300 distribution from her QTP, Sara received $4,600 from that account and $700 from her Coverdell ESA. Www irs gov freefile com In this case, Sara must allocate her $1,200 of adjusted qualified higher education expenses (AQHEE) between the two distributions. Www irs gov freefile com   $1,200 AQHEE × $700 ESA distribution  $5,300 total distribution = $158 AQHEE (ESA)     $1,200 AQHEE × $4,600 QTP distribution  $5,300 total distribution = $1,042 AQHEE (QTP)   Sara then figures the taxable portion of her Coverdell ESA distribution based on qualified higher education expenses of $158, and the taxable portion of her QTP distribution based on the other $1,042. Www irs gov freefile com Note. Www irs gov freefile com If you are required to allocate your expenses between Coverdell ESA and QTP distributions, and you have adjusted qualified elementary and secondary education expenses, see the examples in chapter 7, Coverdell Education Savings Account under Coordination With Qualified Tuition Program (QTP) Distributions . Www irs gov freefile com Coordination With Tuition and Fees Deduction. Www irs gov freefile com   A tuition and fees deduction can be claimed in the same year the beneficiary takes a tax-free distribution from a QTP, as long as the same expenses are not used for both benefits. Www irs gov freefile com Losses on QTP Investments If you have a loss on your investment in a QTP account, you may be able to take the loss on your income tax return. Www irs gov freefile com You can take the loss only when all amounts from that account have been distributed and the total distributions are less than your unrecovered basis. Www irs gov freefile com Your basis is the total amount of contributions to that QTP account. Www irs gov freefile com You claim the loss as a miscellaneous itemized deduction on Schedule A (Form 1040), line 23 (Schedule A (Form 1040NR), line 9), subject to the 2%-of-adjusted-gross-income limit. Www irs gov freefile com If you have distributions from more than one QTP account during a year, you must combine the information (amount of distribution, basis, etc. Www irs gov freefile com ) from all such accounts in order to determine your taxable earnings for the year. Www irs gov freefile com By doing this, the loss from one QTP account reduces the distributed earnings (if any) from any other QTP accounts. Www irs gov freefile com Example 1. Www irs gov freefile com In 2013, Taylor received a final distribution of $1,000 from QTP #1. Www irs gov freefile com His unrecovered basis in that account before the distribution was $3,000. Www irs gov freefile com If Taylor itemizes his deductions, he can claim the $2,000 loss on Schedule A (Form 1040). Www irs gov freefile com Example 2. Www irs gov freefile com Assume the same facts as in Example 1 , except that Taylor also had a distribution of $9,000 from QTP #2, giving him total distributions for 2013 of $10,000. Www irs gov freefile com His total basis in these distributions was $4,500 ($3,000 for QTP #1 and $1,500 for QTP #2). Www irs gov freefile com Taylor's adjusted qualified education expenses for 2013 totaled $6,000. Www irs gov freefile com In order to figure his taxable earnings, Taylor combines the two accounts and determines his taxable earnings as follows. Www irs gov freefile com   1. Www irs gov freefile com $10,000 (total distribution)−$4,500 (basis portion of distribution)     = $5,500 (earnings included in distribution)   2. Www irs gov freefile com $5,500 (earnings) x $6,000 AQEE  $10,000 distribution           =$3,300 (tax-free earnings)     3. Www irs gov freefile com $5,500 (earnings)−$3,300 (tax-free earnings)     =$2,200 (taxable earnings)                 Taylor must include $2,200 in income on Form 1040, line 21. Www irs gov freefile com Because Taylor's accounts must be combined, he cannot deduct his $2,000 loss (QTP #1) on Schedule A (Form 1040). Www irs gov freefile com Instead, the $2,000 loss reduces the total earnings that were distributed, thereby reducing his taxable earnings. Www irs gov freefile com Additional Tax on Taxable Distributions Generally, if you receive a taxable distribution, you also must pay a 10% additional tax on the amount included in income. Www irs gov freefile com Exceptions. Www irs gov freefile com   The 10% additional tax does not apply to distributions: Paid to a beneficiary (or to the estate of the designated beneficiary) on or after the death of the designated beneficiary. Www irs gov freefile com Made because the designated beneficiary is disabled. Www irs gov freefile com A person is considered to be disabled if he or she shows proof that he or she cannot do any substantial gainful activity because of his or her physical or mental condition. Www irs gov freefile com A physician must determine that his or her condition can be expected to result in death or to be of long-continued and indefinite duration. Www irs gov freefile com Included in income because the designated beneficiary received: A tax-free scholarship or fellowship (see Tax-Free Scholarships and Fellowships 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 ), or Any other nontaxable (tax-free) payments (other than gifts or inheritances) received as educational assistance. Www irs gov freefile com Made on account of the attendance of the designated beneficiary at a U. Www irs gov freefile com S. Www irs gov freefile com military academy (such as the USNA at Annapolis). Www irs gov freefile com This exception applies only to the extent that the amount of the distribution does not exceed the costs of advanced education (as defined in section 2005(d)(3) of title 10 of the U. Www irs gov freefile com S. Www irs gov freefile com Code) attributable to such attendance. Www irs gov freefile com Included in income only because the qualified education expenses were taken into account in determining the American opportunity or lifetime learning credit (see Coordination With American Opportunity and Lifetime Learning Credits , earlier. Www irs gov freefile com ) Exception (3) applies only to the extent the distribution is not more than the scholarship, allowance, or payment. Www irs gov freefile com Figuring the additional tax. Www irs gov freefile com    Use Part II of Form 5329, to figure any additional tax. Www irs gov freefile com Report the amount on Form 1040, line 58, or Form 1040NR, line 56. Www irs gov freefile com Rollovers and Other Transfers Assets can be rolled over or transferred from one QTP to another. Www irs gov freefile com In addition, the designated beneficiary can be changed without transferring accounts. Www irs gov freefile com Rollovers Any amount distributed from a QTP is not taxable if it is rolled over to another QTP for the benefit of the same beneficiary or for the benefit of a member of the beneficiary's family (including the beneficiary's spouse). Www irs gov freefile com An amount is rolled over if it is paid to another QTP within 60 days after the date of the distribution. Www irs gov freefile com Do not report qualifying rollovers (those that meet the above criteria) anywhere on Form 1040 or 1040NR. Www irs gov freefile com These are not taxable distributions. Www irs gov freefile com Members of the beneficiary's family. Www irs gov freefile com   For these purposes, the beneficiary's family includes the beneficiary's spouse and the following other relatives of the beneficiary. Www irs gov freefile com Son, daughter, stepchild, foster child, adopted child, or a descendant of any of them. Www irs gov freefile com Brother, sister, stepbrother, or stepsister. Www irs gov freefile com Father or mother or ancestor of either. Www irs gov freefile com Stepfather or stepmother. Www irs gov freefile com Son or daughter of a brother or sister. Www irs gov freefile com Brother or sister of father or mother. Www irs gov freefile com Son-in-law, daughter-in-law, father-in-law, mother-in-law, brother-in-law, or sister-in-law. Www irs gov freefile com The spouse of any individual listed above. Www irs gov freefile com First cousin. Www irs gov freefile com Example. Www irs gov freefile com When Aaron graduated from college last year he had $5,000 left in his QTP. Www irs gov freefile com He wanted to give this money to his younger brother, who was in junior high school. Www irs gov freefile com In order to avoid paying tax on the distribution of the amount remaining in his account, Aaron contributed the same amount to his brother's QTP within 60 days of the distribution. Www irs gov freefile com If the rollover is to another QTP for the same beneficiary, only one rollover is allowed within 12 months of a previous transfer to any QTP for that designated beneficiary. Www irs gov freefile com Changing the Designated Beneficiary There are no income tax consequences if the designated beneficiary of an account is changed to a member of the beneficiary's family. Www irs gov freefile com See Members of the beneficiary's family , earlier. Www irs gov freefile com Example. Www irs gov freefile com Assume the same situation as in the last example. Www irs gov freefile com Instead of closing his QTP and paying the distribution into his brother's QTP, Aaron could have instructed the trustee of his account to simply change the name of the beneficiary on his account to that of his brother. Www irs gov freefile com Prev  Up  Next   Home   More Online Publications
 
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The latest IRS radio Public Service Announcements (PSA) can be played during calendar year 2014. The files are :30 and :60 in English and Spanish MP3 format. The PSA files and text transcripts of each recording are downloadable.

 

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2013 - Filing Your Taxes Radio PSAs

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The Www Irs Gov Freefile Com

Www irs gov freefile com Internal Revenue Bulletin:  2010-9  March 1, 2010  Rev. Www irs gov freefile com Proc. Www irs gov freefile com 2010-18 Table of Contents SECTION 1. Www irs gov freefile com PURPOSE SECTION 2. Www irs gov freefile com BACKGROUND SECTION 3. Www irs gov freefile com SCOPE SECTION 4. Www irs gov freefile com APPLICATION SECTION 5. Www irs gov freefile com EFFECTIVE DATE SECTION 6. Www irs gov freefile com DRAFTING INFORMATION SECTION 1. Www irs gov freefile com PURPOSE This revenue procedure provides: (1) limitations on depreciation deductions for owners of passenger automobiles first placed in service by the taxpayer during calendar year 2010, including a separate table of limitations on depreciation deductions for trucks and vans; and (2) the amounts to be included in income by lessees of passenger automobiles first leased by the taxpayer during calendar year 2010, including a separate table of inclusion amounts for lessees of trucks and vans. Www irs gov freefile com The tables detailing these depreciation limitations and lessee inclusion amounts reflect the automobile price inflation adjustments required by § 280F(d)(7) of the Internal Revenue Code. Www irs gov freefile com SECTION 2. Www irs gov freefile com BACKGROUND . Www irs gov freefile com 01 For owners of passenger automobiles, § 280F(a) imposes dollar limitations on the depreciation deduction for the year the taxpayer places the passenger automobile in service and for each succeeding year. Www irs gov freefile com Section 280F(d)(7) requires the amounts allowable as depreciation deductions to be increased by a price inflation adjustment amount for passenger automobiles placed in service after 1988. Www irs gov freefile com The method of calculating this price inflation amount for trucks and vans placed in service in or after calendar year 2003 uses a different CPI “automobile component” (the “new trucks” component) than that used in the price inflation amount calculation for other passenger automobiles (the “new cars” component), resulting in somewhat higher depreciation deductions for trucks and vans. Www irs gov freefile com This change reflects the higher rate of price inflation for trucks and vans since 1988. Www irs gov freefile com . Www irs gov freefile com 02 Section 280F(c) requires a reduction in the deduction allowed to the lessee of a leased passenger automobile. Www irs gov freefile com The reduction must be substantially equivalent to the limitations on the depreciation deductions imposed on owners of passenger automobiles. Www irs gov freefile com Under § 1. Www irs gov freefile com 280F-7(a) of the Income Tax Regulations, this reduction requires a lessee to include in gross income an inclusion amount determined by applying a formula to the amount obtained from a table. Www irs gov freefile com One table applies to lessees of trucks and vans and another table applies to all other passenger automobiles. Www irs gov freefile com Each table shows inclusion amounts for a range of fair market values for each taxable year after the passenger automobile is first leased. Www irs gov freefile com SECTION 3. Www irs gov freefile com SCOPE . Www irs gov freefile com 01 The limitations on depreciation deductions in section 4. Www irs gov freefile com 01(2) of this revenue procedure apply to passenger automobiles (other than leased passenger automobiles) that are placed in service by the taxpayer in calendar year 2010, and continue to apply for each taxable year that the passenger automobile remains in service. Www irs gov freefile com . Www irs gov freefile com 02 The tables in section 4. Www irs gov freefile com 02 of this revenue procedure apply to leased passenger automobiles for which the lease term begins during calendar year 2010. Www irs gov freefile com Lessees of these passenger automobiles must use these tables to determine the inclusion amount for each taxable year during which the passenger automobile is leased. Www irs gov freefile com See Rev. Www irs gov freefile com Proc. Www irs gov freefile com 2005-13, 2005-1 C. Www irs gov freefile com B. Www irs gov freefile com 759, for passenger automobiles first leased before calendar year 2006; Rev. Www irs gov freefile com Proc. Www irs gov freefile com 2006-18, 2006-1 C. Www irs gov freefile com B. Www irs gov freefile com 645, for passenger automobiles first leased during calendar year 2006; Rev. Www irs gov freefile com Proc. Www irs gov freefile com 2007-30, 2007-1 C. Www irs gov freefile com B. Www irs gov freefile com 1104, for passenger automobiles first leased during calendar year 2007; Rev. Www irs gov freefile com Proc. Www irs gov freefile com 2008-22, 2008-12 I. Www irs gov freefile com R. Www irs gov freefile com B. Www irs gov freefile com 658, for passenger automobiles first leased during calendar year 2008; and Rev. Www irs gov freefile com Proc. Www irs gov freefile com 2009-24, 2009-17 I. Www irs gov freefile com R. Www irs gov freefile com B. Www irs gov freefile com 885, for passenger automobiles first leased during calendar year 2009. Www irs gov freefile com SECTION 4. Www irs gov freefile com APPLICATION . Www irs gov freefile com 01 Limitations on Depreciation Deductions for Certain Automobiles. Www irs gov freefile com (1) Amount of the inflation adjustment. Www irs gov freefile com (a) Passenger automobiles (other than trucks or vans). Www irs gov freefile com Under § 280F(d)(7)(B)(i), the automobile price inflation adjustment for any calendar year is the percentage (if any) by which the CPI automobile component for October of the preceding calendar year exceeds the CPI automobile component for October 1987. Www irs gov freefile com The term “CPI automobile component” is defined in § 280F(d)(7)(B)(ii) as the “automobile component” of the Consumer Price Index for all Urban Consumers published by the Department of Labor. Www irs gov freefile com The new car component of the CPI was 115. Www irs gov freefile com 2 for October 1987 and 137. Www irs gov freefile com 851 for October 2009. Www irs gov freefile com The October 2009 index exceeded the October 1987 index by 22. Www irs gov freefile com 651. Www irs gov freefile com Therefore, the automobile price inflation adjustment for 2010 for passenger automobiles (other than trucks and vans) is 19. Www irs gov freefile com 66 percent (22. Www irs gov freefile com 651/115. Www irs gov freefile com 2 x 100%). Www irs gov freefile com The dollar limitations in § 280F(a) are multiplied by a factor of 0. Www irs gov freefile com 1966, and the resulting increases, after rounding to the nearest $100, are added to the 1988 limitations to give the depreciation limitations applicable to passenger automobiles (other than trucks and vans) for calendar year 2010. Www irs gov freefile com This adjustment applies to all passenger automobiles (other than trucks and vans) that are first placed in service in calendar year 2010. Www irs gov freefile com (b) Trucks and vans. Www irs gov freefile com To determine the dollar limitations for trucks and vans first placed in service during calendar year 2010, the new truck component of the CPI is used instead of the new car component. Www irs gov freefile com The new truck component of the CPI was 112. Www irs gov freefile com 4 for October 1987 and 140. Www irs gov freefile com 897 for October 2009. Www irs gov freefile com The October 2009 index exceeded the October 1987 index by 28. Www irs gov freefile com 497. Www irs gov freefile com Therefore, the automobile price inflation adjustment for 2010 for trucks and vans is 25. Www irs gov freefile com 35 percent (28. Www irs gov freefile com 497/112. Www irs gov freefile com 4 x 100%). Www irs gov freefile com The dollar limitations in § 280F(a) are multiplied by a factor of 0. Www irs gov freefile com 2535, and the resulting increases, after rounding to the nearest $100, are added to the 1988 limitations to give the depreciation limitations for trucks and vans. Www irs gov freefile com This adjustment applies to all trucks and vans that are first placed in service in calendar year 2010. Www irs gov freefile com (2) Amount of the limitation. Www irs gov freefile com Tables 1 and 2 contain the dollar amount of the depreciation limitation for each taxable year for passenger automobiles a taxpayer places in service in calendar year 2010. Www irs gov freefile com Use Table 1 for a passenger automobile (other than a truck or van) and Table 2 for a truck or van placed in service in calendar year 2010. Www irs gov freefile com REV. Www irs gov freefile com PROC. Www irs gov freefile com 2010-18 TABLE 1 DEPRECIATION LIMITATIONS FOR PASSENGER AUTOMOBILES (THAT ARE NOT TRUCKS OR VANS) PLACED IN SERVICE IN CALENDAR YEAR 2010 Tax Year Amount 1st Tax Year $3,060 2nd Tax Year $4,900 3rd Tax Year $2,950 Each Succeeding Year $1,775 REV. Www irs gov freefile com PROC. Www irs gov freefile com 2010-18 TABLE 2 DEPRECIATION LIMITATIONS FOR TRUCKS AND VANS PLACED IN SERVICE IN CALENDAR YEAR 2010 Tax Year Amount 1st Tax Year $3,160 2nd Tax Year $5,100 3rd Tax Year $3,050 Each Succeeding Year $1,875 . Www irs gov freefile com 02 Inclusions in Income of Lessees of Passenger Automobiles. Www irs gov freefile com A taxpayer must follow the procedures in § 1. Www irs gov freefile com 280F-7(a) for determining the inclusion amounts for passenger automobiles first leased in calendar year 2010. Www irs gov freefile com In applying these procedures, lessees of passenger automobiles other than trucks and vans should use Table 3 of this revenue procedure, while lessees of trucks and vans should use Table 4 of this revenue procedure. Www irs gov freefile com REV. Www irs gov freefile com PROC. Www irs gov freefile com 2010-18 TABLE 3 DOLLAR AMOUNTS FOR PASSENGER AUTOMOBILES (THAT ARE NOT TRUCKS OR VANS) WITH A LEASE TERM BEGINNING IN CALENDAR YEAR 2010 Fair Market Value of Passenger Automobile Tax Year During Lease Over Not Over 1st 2nd 3rd 4th 5th & Later $16,700 $17,000 3 7 10 11 14 17,000 17,500 4 8 13 15 16 17,500 18,000 5 10 16 19 21 18,000 18,500 6 13 18 23 26 18,500 19,000 7 15 22 26 31 19,000 19,500 8 17 25 30 35 19,500 20,000 9 19 29 34 39 20,000 20,500 10 21 32 38 44 20,500 21,000 11 23 35 42 48 21,000 21,500 12 26 38 45 53 21,500 22,000 13 28 41 50 57 22,000 23,000 14 31 46 56 63 23,000 24,000 16 36 52 63 73 24,000 25,000 18 40 59 71 81 25,000 26,000 20 44 66 78 90 26,000 27,000 22 49 71 86 100 27,000 28,000 24 53 78 94 108 28,000 29,000 26 57 85 101 118 29,000 30,000 28 61 92 109 126 30,000 31,000 30 66 97 117 135 31,000 32,000 32 70 104 125 144 32,000 33,000 34 74 111 132 153 33,000 34,000 36 79 117 140 161 34,000 35,000 38 83 123 148 171 35,000 36,000 40 87 130 156 179 36,000 37,000 42 92 136 163 188 37,000 38,000 44 96 143 170 198 38,000 39,000 46 100 149 179 206 39,000 40,000 48 105 155 186 215 40,000 41,000 50 109 162 194 224 41,000 42,000 52 113 169 201 233 42,000 43,000 54 118 174 210 241 43,000 44,000 56 122 181 217 251 44,000 45,000 58 126 188 225 259 45,000 46,000 60 131 194 232 269 46,000 47,000 61 135 201 240 277 47,000 48,000 63 140 207 248 286 48,000 49,000 65 144 213 256 295 49,000 50,000 67 148 220 263 304 50,000 51,000 69 153 226 271 313 51,000 52,000 71 157 232 279 322 52,000 53,000 73 161 239 287 331 53,000 54,000 75 166 245 294 340 54,000 55,000 77 170 252 302 348 55,000 56,000 79 174 258 310 358 56,000 57,000 81 178 265 318 366 57,000 58,000 83 183 271 325 375 58,000 59,000 85 187 278 333 384 59,000 60,000 87 191 284 341 393 60,000 62,000 90 198 294 352 406 62,000 64,000 94 207 306 368 424 64,000 66,000 98 215 320 382 443 66,000 68,000 102 224 332 398 460 68,000 70,000 106 232 346 413 478 70,000 72,000 110 241 358 429 496 72,000 74,000 114 250 371 444 513 74,000 76,000 118 258 384 460 531 76,000 78,000 122 267 396 476 549 78,000 80,000 126 276 409 491 566 80,000 85,000 132 291 432 518 598 85,000 90,000 142 313 464 556 643 90,000 95,000 152 334 497 594 687 95,000 100,000 162 356 528 634 731 100,000 110,000 177 388 577 691 798 110,000 120,000 196 432 641 768 887 120,000 130,000 216 475 705 846 976 130,000 140,000 236 518 770 922 1,065 140,000 150,000 256 561 834 1,000 1,154 150,000 160,000 275 605 898 1,077 1,243 160,000 170,000 295 648 963 1,153 1,333 170,000 180,000 315 691 1,027 1,231 1,421 180,000 190,000 334 735 1,091 1,308 1,510 190,000 200,000 354 778 1,155 1,386 1,599 200,000 210,000 374 821 1,220 1,462 1,688 210,000 220,000 393 865 1,284 1,539 1,777 220,000 230,000 413 908 1,348 1,617 1,866 230,000 240,000 433 951 1,413 1,693 1,956 240,000 and up 453 995 1,476 1,771 2,044 REV. Www irs gov freefile com PROC. Www irs gov freefile com 2010-18 TABLE 4 DOLLAR AMOUNTS FOR TRUCKS AND VANS WITH A LEASE TERM BEGINNING IN CALENDAR YEAR 2010 Fair Market Value of Passenger Automobile Tax Year During Lease Over Not Over 1st 2nd 3rd 4th 5th & Later 17,000 17,500 3 6 9 10 11 17,500 18,000 4 8 12 14 16 18,000 18,500 5 10 15 18 21 18,500 19,000 6 12 19 22 24 19,000 19,500 7 15 21 26 29 19,500 20,000 8 17 25 29 34 20,000 20,500 9 19 28 33 38 20,500 21,000 10 21 31 37 43 21,000 21,500 11 23 35 41 47 21,500 22,000 12 25 38 45 51 22,000 23,000 13 29 42 51 58 23,000 24,000 15 33 49 58 67 24,000 25,000 17 37 56 66 76 25,000 26,000 19 42 62 73 85 26,000 27,000 21 46 68 82 93 27,000 28,000 23 50 75 89 103 28,000 29,000 25 55 81 97 111 29,000 30,000 27 59 88 104 121 30,000 31,000 29 63 94 113 129 31,000 32,000 31 68 100 120 138 32,000 33,000 33 72 107 127 148 33,000 34,000 35 76 114 135 156 34,000 35,000 37 81 119 143 165 35,000 36,000 39 85 126 151 174 36,000 37,000 41 89 133 158 183 37,000 38,000 43 94 139 166 191 38,000 39,000 45 98 145 174 201 39,000 40,000 47 102 152 182 209 40,000 41,000 49 106 159 189 218 41,000 42,000 51 111 164 198 227 42,000 43,000 53 115 171 205 236 43,000 44,000 55 119 178 213 245 44,000 45,000 57 124 184 220 254 45,000 46,000 59 128 190 228 263 46,000 47,000 60 133 197 235 272 47,000 48,000 62 137 203 244 280 48,000 49,000 64 142 209 251 290 49,000 50,000 66 146 216 259 298 50,000 51,000 68 150 223 266 308 51,000 52,000 70 154 229 275 316 52,000 53,000 72 159 235 282 325 53,000 54,000 74 163 242 290 334 54,000 55,000 76 167 249 297 343 55,000 56,000 78 172 254 305 352 56,000 57,000 80 176 261 313 361 57,000 58,000 82 180 268 320 370 58,000 59,000 84 185 274 328 378 59,000 60,000 86 189 280 336 388 60,000 62,000 89 195 291 347 401 62,000 64,000 93 204 303 363 418 64,000 66,000 97 213 315 379 436 66,000 68,000 101 221 329 394 454 68,000 70,000 105 230 341 410 472 70,000 72,000 109 239 354 424 490 72,000 74,000 113 247 367 440 508 74,000 76,000 117 256 380 455 526 76,000 78,000 121 264 393 471 543 78,000 80,000 125 273 406 486 561 80,000 85,000 131 289 428 513 592 85,000 90,000 141 310 461 552 636 90,000 95,000 151 332 492 591 681 95,000 100,000 161 353 525 629 726 100,000 110,000 176 386 573 686 793 110,000 120,000 195 430 637 763 882 120,000 130,000 215 473 701 841 971 130,000 140,000 235 516 766 918 1,059 140,000 150,000 255 559 830 995 1,149 150,000 160,000 274 603 894 1,072 1,238 160,000 170,000 294 646 958 1,150 1,326 170,000 180,000 314 689 1,023 1,226 1,416 180,000 190,000 333 733 1,087 1,303 1,505 190,000 200,000 353 776 1,151 1,381 1,594 200,000 210,000 373 819 1,216 1,457 1,683 210,000 220,000 392 863 1,280 1,534 1,772 220,000 230,000 412 906 1,344 1,612 1,861 230,000 240,000 432 949 1,409 1,689 1,949 240,000 and up 452 992 1,473 1,766 2,039 SECTION 5. Www irs gov freefile com EFFECTIVE DATE This revenue procedure applies to passenger automobiles that a taxpayer first places in service or first leases during calendar year 2010. Www irs gov freefile com SECTION 6. Www irs gov freefile com DRAFTING INFORMATION The principal author of this revenue procedure is Bernard P. Www irs gov freefile com Harvey of the Office of Associate Chief Counsel (Income Tax & Accounting). Www irs gov freefile com For further information regarding this revenue procedure, contact Mr. Www irs gov freefile com Harvey at (202) 622-4930 (not a toll-free call). Www irs gov freefile com Prev  Up  Next   Home   More Internal Revenue Bulletins