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1040 Ez 2011

1040 ez 2011 6. 1040 ez 2011   Tip Income Table of Contents Introduction Useful Items - You may want to see: Keeping a Daily Tip RecordElectronic tip record. 1040 ez 2011 Reporting Tips to Your EmployerElectronic tip statement. 1040 ez 2011 Final report. 1040 ez 2011 Reporting Tips on Your Tax Return Allocated Tips Introduction This chapter is for employees who receive tips. 1040 ez 2011 All tips you receive are income and are subject to federal income tax. 1040 ez 2011 You must include in gross income all tips you receive directly, charged tips paid to you by your employer, and your share of any tips you receive under a tip-splitting or tip-pooling arrangement. 1040 ez 2011 The value of noncash tips, such as tickets, passes, or other items of value, is also income and subject to tax. 1040 ez 2011 Reporting your tip income correctly is not difficult. 1040 ez 2011 You must do three things. 1040 ez 2011 Keep a daily tip record. 1040 ez 2011 Report tips to your employer. 1040 ez 2011 Report all your tips on your income tax return. 1040 ez 2011  This chapter will explain these three things and show you what to do on your tax return if you have not done the first two. 1040 ez 2011 This chapter will also show you how to treat allocated tips. 1040 ez 2011 For information on special tip programs and agreements, see Publication 531. 1040 ez 2011 Useful Items - You may want to see: Publication 531 Reporting Tip Income 1244 Employee's Daily Record of Tips and Report to Employer Form (and Instructions) 4137 Social Security and Medicare Tax on Unreported Tip Income 4070 Employee's Report of Tips to Employer Keeping a Daily Tip Record Why keep a daily tip record. 1040 ez 2011   You must keep a daily tip record so you can: Report your tips accurately to your employer, Report your tips accurately on your tax return, and Prove your tip income if your return is ever questioned. 1040 ez 2011 How to keep a daily tip record. 1040 ez 2011   There are two ways to keep a daily tip record. 1040 ez 2011 You can either: Write information about your tips in a tip diary, or Keep copies of documents that show your tips, such as restaurant bills and credit or debit card charge slips. 1040 ez 2011 You should keep your daily tip record with your tax or other personal records. 1040 ez 2011 You must keep your records for as long as they are important for administration of the federal tax law. 1040 ez 2011 For information on how long to keep records, see How long to keep records in chapter 1. 1040 ez 2011    If you keep a tip diary, you can use Form 4070A, Employee's Daily Record of Tips. 1040 ez 2011 To get Form 4070A, ask the Internal Revenue Service (IRS) or your employer for Publication 1244. 1040 ez 2011 Also, Publication 1244 is available online at www. 1040 ez 2011 irs. 1040 ez 2011 gov/pub/irs-pdf/p1244. 1040 ez 2011 pdf. 1040 ez 2011 Publication 1244 includes a 1-year supply of Form 4070A. 1040 ez 2011 Each day, write in the information asked for on the form. 1040 ez 2011   In addition to the information asked for on Form 4070A, you also need to keep a record of the date and value of any noncash tips you get, such as tickets, passes, or other items of value. 1040 ez 2011 Although you do not report these tips to your employer, you must report them on your tax return. 1040 ez 2011   If you do not use Form 4070A, start your records by writing your name, your employer's name, and the name of the business (if it is different from your employer's name). 1040 ez 2011 Then, each workday, write the date and the following information. 1040 ez 2011 Cash tips you get directly from customers or from other employees. 1040 ez 2011 Tips from credit and debit card charge customers that your employer pays you. 1040 ez 2011 The value of any noncash tips you get, such as tickets, passes, or other items of value. 1040 ez 2011 The amount of tips you paid out to other employees through tip pools or tip splitting, or other arrangements, and the names of the employees to whom you paid the tips. 1040 ez 2011 Electronic tip record. 1040 ez 2011   You can use an electronic system provided by your employer to record your daily tips. 1040 ez 2011 If you do, you must receive and keep a paper copy of this record. 1040 ez 2011 Service charges. 1040 ez 2011    Do not write in your tip diary the amount of any service charge that your employer adds to a customer's bill and then pays to you and treats as wages. 1040 ez 2011 This is part of your wages, not a tip. 1040 ez 2011 See examples below. 1040 ez 2011 Example 1. 1040 ez 2011 Good Food Restaurant adds an 18% charge to the bill for parties of 6 or more customers. 1040 ez 2011 Jane’s bill for food and beverages for her party of 8 includes an amount on the tip line equal to 18% of the charges for food and beverages, and the total includes this amount. 1040 ez 2011 Because Jane did not have an unrestricted right to determine the amount on the “tip line,” the 18% charge is considered a service charge. 1040 ez 2011 Do not include the 18% charge in your tip diary. 1040 ez 2011 Service charges that are paid to you are considered wages, not tips. 1040 ez 2011 Example 2. 1040 ez 2011 Good Food Restaurant also includes sample calculations of tip amounts at the bottom of its bills for food and beverages provided to customers. 1040 ez 2011 David’s bill includes a blank “tip line,” with sample tip calculations of 15%, 18%, and 20% of his charges for food and beverages at the bottom of the bill beneath the signature line. 1040 ez 2011 Because David is free to enter any amount on the “tip line” or leave it blank, any amount he includes is considered a tip. 1040 ez 2011 Be sure to include this amount in your tip diary. 1040 ez 2011 Reporting Tips to Your Employer Why report tips to your employer. 1040 ez 2011   You must report tips to your employer so that: Your employer can withhold federal income tax and social security, Medicare, Additional Medicare, or railroad retirement taxes, Your employer can report the correct amount of your earnings to the Social Security Administration or Railroad Retirement Board (which affects your benefits when you retire or if you become disabled, or your family's benefits if you die), and You can avoid the penalty for not reporting tips to your employer (explained later). 1040 ez 2011 What tips to report. 1040 ez 2011   Report to your employer only cash, check, and debit and credit card tips you receive. 1040 ez 2011   If your total tips for any 1 month from any one job are less than $20, do not report the tips for that month to that employer. 1040 ez 2011   If you participate in a tip-splitting or tip-pooling arrangement, report only the tips you receive and retain. 1040 ez 2011 Do not report to your employer any portion of the tips you receive that you pass on to other employees. 1040 ez 2011 However, you must report tips you receive from other employees. 1040 ez 2011    Do not report the value of any noncash tips, such as tickets or passes, to your employer. 1040 ez 2011 You do not pay social security, Medicare, Additional Medicare or railroad retirement taxes on these tips. 1040 ez 2011 How to report. 1040 ez 2011    If your employer does not give you any other way to report tips, you can use Form 4070. 1040 ez 2011 Fill in the information asked for on the form, sign and date the form, and give it to your employer. 1040 ez 2011 To get a 1-year supply of the form, ask the IRS or your employer for Publication 1244. 1040 ez 2011   If you do not use Form 4070, give your employer a statement with the following information. 1040 ez 2011 Your name, address, and social security number. 1040 ez 2011 Your employer's name, address, and business name (if it is different from your employer's name). 1040 ez 2011 The month (or the dates of any shorter period) in which you received tips. 1040 ez 2011 The total tips required to be reported for that period. 1040 ez 2011 You must sign and date the statement. 1040 ez 2011 Be sure to keep a copy with your tax or other personal records. 1040 ez 2011   Your employer may require you to report your tips more than once a month. 1040 ez 2011 However, the statement cannot cover a period of more than 1 calendar month. 1040 ez 2011 Electronic tip statement. 1040 ez 2011   Your employer can have you furnish your tip statements electronically. 1040 ez 2011 When to report. 1040 ez 2011   Give your report for each month to your employer by the 10th of the next month. 1040 ez 2011 If the 10th falls on a Saturday, Sunday, or legal holiday, give your employer the report by the next day that is not a Saturday, Sunday, or legal holiday. 1040 ez 2011 Example. 1040 ez 2011 You must report your tips received in September 2014 by October 10, 2014. 1040 ez 2011 Final report. 1040 ez 2011   If your employment ends during the month, you can report your tips when your employment ends. 1040 ez 2011 Penalty for not reporting tips. 1040 ez 2011   If you do not report tips to your employer as required, you may be subject to a penalty equal to 50% of the social security, Medicare, and Additional Medicare taxes or railroad retirement tax you owe on the unreported tips. 1040 ez 2011 (For information about these taxes, see Reporting social security, Medicare, Additional Medicare, or railroad retirement taxes on tips not reported to your employer under Reporting Tips on Your Tax Return, later. 1040 ez 2011 ) The penalty amount is in addition to the taxes you owe. 1040 ez 2011   You can avoid this penalty if you can show reasonable cause for not reporting the tips to your employer. 1040 ez 2011 To do so, attach a statement to your return explaining why you did not report them. 1040 ez 2011 Giving your employer money for taxes. 1040 ez 2011   Your regular pay may not be enough for your employer to withhold all the taxes you owe on your regular pay plus your reported tips. 1040 ez 2011 If this happens, you can give your employer money until the close of the calendar year to pay the rest of the taxes. 1040 ez 2011   If you do not give your employer enough money, your employer will apply your regular pay and any money you give in the following order. 1040 ez 2011 All taxes on your regular pay. 1040 ez 2011 Social security, Medicare, and Additional Medicare taxes or railroad retirement taxes on your reported tips. 1040 ez 2011 Federal, state, and local income taxes on your reported tips. 1040 ez 2011    Any taxes that remain unpaid can be collected by your employer from your next paycheck. 1040 ez 2011 If withholding taxes remain uncollected at the end of the year, you may be subject to a penalty for underpayment of estimated taxes. 1040 ez 2011 See Publication 505, Tax Withholding and Estimated Tax, for more information. 1040 ez 2011    Uncollected taxes. 1040 ez 2011 You must report on your tax return any social security and Medicare taxes or railroad retirement tax that remained uncollected at the end of 2013. 1040 ez 2011 These uncollected taxes will be shown on your 2013 Form W-2. 1040 ez 2011 See Reporting uncollected social security, Medicare, or railroad retirement taxes on tips reported to your employer under Reporting Tips on Your Tax Return, later. 1040 ez 2011 Reporting Tips on Your Tax Return How to report tips. 1040 ez 2011    Report your tips with your wages on Form 1040, line 7; Form 1040A, line 7; or Form 1040EZ, line 1. 1040 ez 2011 What tips to report. 1040 ez 2011   You must report all tips you received in 2013 on your tax return, including both cash tips and noncash tips. 1040 ez 2011 Any tips you reported to your employer for 2013 are included in the wages shown in box 1 of your Form W-2. 1040 ez 2011 Add to the amount in box 1 only the tips you did not report to your employer. 1040 ez 2011    If you received $20 or more in cash and charge tips in a month and did not report all of those tips to your employer, see Reporting social security, Medicare, Additional Medicare, or railroad retirement taxes on tips not reported to your employer, later. 1040 ez 2011    If you did not keep a daily tip record as required and an amount is shown in box 8 of your Form W-2, see Allocated Tips, later. 1040 ez 2011   If you kept a daily tip record and reported tips to your employer as required under the rules explained earlier, add the following tips to the amount in box 1 of your Form W-2. 1040 ez 2011 Cash and charge tips you received that totaled less than $20 for any month. 1040 ez 2011 The value of noncash tips, such as tickets, passes, or other items of value. 1040 ez 2011 Example. 1040 ez 2011 Ben Smith began working at the Blue Ocean Restaurant (his only employer in 2013) on June 30 and received $10,000 in wages during the year. 1040 ez 2011 Ben kept a daily tip record showing that his tips for June were $18 and his tips for the rest of the year totaled $7,000. 1040 ez 2011 He was not required to report his June tips to his employer, but he reported all of the rest of his tips to his employer as required. 1040 ez 2011 Ben's Form W-2 from Blue Ocean Restaurant shows $17,000 ($10,000 wages plus $7,000 reported tips) in box 1. 1040 ez 2011 He adds the $18 unreported tips to that amount and reports $17,018 as wages on his tax return. 1040 ez 2011 Reporting social security, Medicare, Additional Medicare, or railroad retirement taxes on tips not reported to your employer. 1040 ez 2011    If you received $20 or more in cash and charge tips in a month from any one job and did not report all of those tips to your employer, you must report the social security, Medicare, and Additional Medicare taxes on the unreported tips as additional tax on your return. 1040 ez 2011 To report these taxes, you must file a return even if you would not otherwise have to file. 1040 ez 2011 You must use Form 1040. 1040 ez 2011 (You cannot file Form 1040EZ or Form 1040A. 1040 ez 2011 )    Use Form 4137 to figure social security and Medicare taxes. 1040 ez 2011 Enter the tax on your return as instructed, and attach the completed Form 4137 to your return. 1040 ez 2011 Use Form 8959 to figure Additional Medicare Tax. 1040 ez 2011    If you are subject to the Railroad Retirement Tax Act, you cannot use Form 4137 to pay railroad retirement tax on unreported tips. 1040 ez 2011 To get railroad retirement credit, you must report tips to your employer. 1040 ez 2011 Reporting uncollected social security, Medicare, or railroad retirement taxes on tips reported to your employer. 1040 ez 2011   You may have uncollected taxes if your regular pay was not enough for your employer to withhold all the taxes you owe and you did not give your employer enough money to pay the rest of the taxes. 1040 ez 2011 For more information, see Giving your employer money for taxes , under Reporting Tips to Your Employer, earlier. 1040 ez 2011   If your employer could not collect all the social security and Medicare taxes or railroad retirement tax you owe on tips reported for 2013, the uncollected taxes will be shown in box 12 of your Form W-2 (codes A and B). 1040 ez 2011 You must report these amounts as additional tax on your return. 1040 ez 2011 Unlike the uncollected portion of the regular (1. 1040 ez 2011 45%) Medicare tax, the uncollected Additional Medicare Tax is not reported in box 12 of Form W-2 with code B. 1040 ez 2011    To report these uncollected taxes, you must file a return even if you would not otherwise have to file. 1040 ez 2011 You must report these taxes on Form 1040, line 60. 1040 ez 2011 See the instructions for Form 1040, line 60. 1040 ez 2011 (You cannot file Form 1040EZ or Form 1040A. 1040 ez 2011 ) Allocated Tips If your employer allocated tips to you, they are shown separately in box 8 of your Form W-2. 1040 ez 2011 They are not included in box 1 with your wages and reported tips. 1040 ez 2011 If box 8 is blank, this discussion does not apply to you. 1040 ez 2011 What are allocated tips. 1040 ez 2011   These are tips that your employer assigned to you in addition to the tips you reported to your employer for the year. 1040 ez 2011 Your employer will have done this only if: You worked in an establishment (restaurant, cocktail lounge, or similar business) that must allocate tips to employees, and The tips you reported to your employer were less than your share of 8% of food and drink sales. 1040 ez 2011 No income, social security, Medicare, Additional Medicare or railroad retirement taxes are withheld on allocated tips. 1040 ez 2011 How were your allocated tips figured. 1040 ez 2011   The tips allocated to you are your share of an amount figured by subtracting the reported tips of all employees from 8% (or an approved lower rate) of food and drink sales (other than carryout sales and sales with a service charge of 10% or more). 1040 ez 2011 Your share of that amount was figured using either a method provided by an employer-employee agreement or a method provided by IRS regulations based on employees' sales or hours worked. 1040 ez 2011 For information about the exact allocation method used, ask your employer. 1040 ez 2011 Must you report your allocated tips on your tax return. 1040 ez 2011   You must report all tips you received in 2013 on your tax return, including both cash tips and noncash tips. 1040 ez 2011 Any tips you reported to your employer for 2013 are included in the wages shown in box 1 of your Form W-2. 1040 ez 2011 Add to the amount in box 1 only the tips you did not report to your employer. 1040 ez 2011 This should include any allocated tips shown in box 8 on your Form(s) W-2, unless you have adequate records to show that you received less tips in the year than the allocated figures. 1040 ez 2011   See What tips to report under Reporting Tips on Your Tax Return, and Keeping a Daily Tip Record , earlier. 1040 ez 2011 How to report allocated tips. 1040 ez 2011   Report the amount in box 1 and the allocated tips in box 8 of your Form(s) W-2 as wages on Form 1040, line 7; Form 1040NR, line 8; or Form 1040NR-EZ, line 3. 1040 ez 2011 (You cannot file Form 1040A or Form 1040EZ when you have allocated tips. 1040 ez 2011 )    Because social security, Medicare, and Additional Medicare taxes were not withheld from the allocated tips, you must report those taxes as additional tax on your return. 1040 ez 2011 Complete Form 4137, and include the allocated tips on line 1 of the form. 1040 ez 2011 See Reporting social security, Medicare, Additional Medicare, or railroad retirement taxes on tips not reported to your employer under Reporting Tips on Your Tax Return, earlier. 1040 ez 2011 Prev  Up  Next   Home   More Online Publications
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Understanding Your CP297C Notice

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Process hearing.


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Why should I request a Collection Due Process hearing?
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How can I request a Collection Due Process hearing?
Complete and send us a Form 12153, Request for a Collection Due Process or Equivalent Hearing.

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Page Last Reviewed or Updated: 27-Jan-2014

The 1040 Ez 2011

1040 ez 2011 Internal Revenue Bulletin:  2012-14  April 2, 2012  Rev. 1040 ez 2011 Proc. 1040 ez 2011 2012-23 Table of Contents SECTION 1. 1040 ez 2011 PURPOSE SECTION 2. 1040 ez 2011 BACKGROUND SECTION 3. 1040 ez 2011 SCOPE SECTION 4. 1040 ez 2011 APPLICATION. 1040 ez 2011 01 Limitations on Depreciation Deductions for Certain Automobiles. 1040 ez 2011 . 1040 ez 2011 02 Inclusions in Income of Lessees of Passenger Automobiles. 1040 ez 2011 SECTION 5. 1040 ez 2011 EFFECTIVE DATE SECTION 6. 1040 ez 2011 DRAFTING INFORMATION SECTION 1. 1040 ez 2011 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 2012, including separate tables of limitations on depreciation deductions for trucks and vans; and (2) the amounts that must be included in income by lessees of passenger automobiles first leased by the taxpayer during calendar year 2012, including a separate table of inclusion amounts for lessees of trucks and vans. 1040 ez 2011 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. 1040 ez 2011 SECTION 2. 1040 ez 2011 BACKGROUND . 1040 ez 2011 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. 1040 ez 2011 For passenger automobiles placed in service after 1988, § 280F(d)(7) requires the Internal Revenue Service to increase the amounts allowable as depreciation deductions by a price inflation adjustment amount. 1040 ez 2011 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. 1040 ez 2011 This change reflects the higher rate of price inflation for trucks and vans since 1988. 1040 ez 2011 . 1040 ez 2011 02 Section 401(a) of the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010, Pub. 1040 ez 2011 L. 1040 ez 2011 No. 1040 ez 2011 111-312, 124 Stat. 1040 ez 2011 3296 (Dec. 1040 ez 2011 17, 2010) (the “Act”) extended the 50 percent additional first year depreciation deduction under § 168(k) to qualified property acquired by the taxpayer after December 31, 2007, and before January 1, 2013, if no written binding contract for the acquisition of the property existed before January 1, 2008, and if the taxpayer places the property in service generally before January 1, 2013. 1040 ez 2011 Section 168(k)(2)(F)(i) increases the first year depreciation allowed under § 280F(a)(1)(A)(i) by $8,000 for passenger automobiles to which the additional first year depreciation deduction under § 168(k) (hereinafter, referred to as “§ 168(k) additional first year depreciation deduction”) applies. 1040 ez 2011 . 1040 ez 2011 03 Section 168(k)(2)(D)(i) provides that the § 168(k) additional first year depreciation deduction does not apply to any property required to be depreciated under the alternative depreciation system of § 168(g), including property described in § 280F(b)(1). 1040 ez 2011 Section 168(k)(2)(D)(iii) permits a taxpayer to elect out of the § 168(k) additional first year depreciation deduction for any class of property. 1040 ez 2011 Section 168(k)(4), as amended by the Act, permits a corporation to elect to increase the alternative minimum tax (“AMT”) credit limitation under § 53(c), instead of claiming the § 168(k) additional first year depreciation deduction for all eligible qualified property placed in service after December 31, 2010, that is round 2 extension property (as defined in § 168(k)(4)(I)(iv)). 1040 ez 2011 Accordingly, this revenue procedure provides tables for passenger automobiles for which the § 168(k) additional first year depreciation deduction applies. 1040 ez 2011 This revenue procedure also provides tables for passenger automobiles for which the § 168(k) additional first year depreciation deduction does not apply, either because taxpayer (1) purchased the passenger automobile used; (2) did not use the passenger automobile during 2012 more than 50 percent for business purposes; (3) elected out of the § 168(k) additional first year depreciation deduction pursuant to § 168(k)(2)(D)(iii); or (4) elected to increase the § 53 AMT credit limitation in lieu of claiming § 168(k) additional first year depreciation. 1040 ez 2011 . 1040 ez 2011 04 Section 280F(c) requires a reduction in the deduction allowed to the lessee of a leased passenger automobile. 1040 ez 2011 The reduction must be substantially equivalent to the limitations on the depreciation deductions imposed on owners of passenger automobiles. 1040 ez 2011 Under § 1. 1040 ez 2011 280F-7(a) of the Income Tax Regulations, this reduction requires a lessee to include in gross income an amount determined by applying a formula to the amount obtained from a table. 1040 ez 2011 One table applies to lessees of trucks and vans and another table applies to all other passenger automobiles. 1040 ez 2011 Each table shows inclusion amounts for a range of fair market values for each taxable year after the passenger automobile is first leased. 1040 ez 2011 SECTION 3. 1040 ez 2011 SCOPE . 1040 ez 2011 01 The limitations on depreciation deductions in section 4. 1040 ez 2011 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 2012, and continue to apply for each taxable year that the passenger automobile remains in service. 1040 ez 2011 . 1040 ez 2011 02 The tables in section 4. 1040 ez 2011 02 of this revenue procedure apply to leased passenger automobiles for which the lease term begins during calendar year 2012. 1040 ez 2011 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. 1040 ez 2011 See Rev. 1040 ez 2011 Proc. 1040 ez 2011 2007-30, 2007-1 C. 1040 ez 2011 B. 1040 ez 2011 1104, for passenger automobiles first leased during calendar year 2007; Rev. 1040 ez 2011 Proc. 1040 ez 2011 2008-22, 2008-1 C. 1040 ez 2011 B. 1040 ez 2011 658, for passenger automobiles first leased during calendar year 2008; Rev. 1040 ez 2011 Proc. 1040 ez 2011 2009-24, 2009-17 I. 1040 ez 2011 R. 1040 ez 2011 B. 1040 ez 2011 885, for passenger automobiles first leased during calendar year 2009; Rev. 1040 ez 2011 Proc. 1040 ez 2011 2010-18, 2010-9 I. 1040 ez 2011 R. 1040 ez 2011 B. 1040 ez 2011 427, as amplified and modified by section 4. 1040 ez 2011 03 of Rev. 1040 ez 2011 Proc. 1040 ez 2011 2011-21, 2011-12 I. 1040 ez 2011 R. 1040 ez 2011 B. 1040 ez 2011 560, for passenger automobiles first leased during calendar year 2010; and Rev. 1040 ez 2011 Proc. 1040 ez 2011 2011-21, for passenger automobiles first leased during calendar year 2011. 1040 ez 2011 SECTION 4. 1040 ez 2011 APPLICATION . 1040 ez 2011 01 Limitations on Depreciation Deductions for Certain Automobiles. 1040 ez 2011 (1) Amount of the inflation adjustment. 1040 ez 2011 (a) Passenger automobiles (other than trucks or vans). 1040 ez 2011 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. 1040 ez 2011 Section 280F(d)(7)(B)(ii) defines the term “CPI automobile component” as the automobile component of the Consumer Price Index for all Urban Consumers published by the Department of Labor. 1040 ez 2011 The new car component of the CPI was 115. 1040 ez 2011 2 for October 1987 and 143. 1040 ez 2011 419 for October 2011. 1040 ez 2011 The October 2011 index exceeded the October 1987 index by 28. 1040 ez 2011 219. 1040 ez 2011 Therefore, the automobile price inflation adjustment for 2012 for passenger automobiles (other than trucks and vans) is 24. 1040 ez 2011 5 percent (28. 1040 ez 2011 219/115. 1040 ez 2011 2 x 100%). 1040 ez 2011 The dollar limitations in § 280F(a) are multiplied by a factor of 0. 1040 ez 2011 245, 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 2012. 1040 ez 2011 This adjustment applies to all passenger automobiles (other than trucks and vans) that are first placed in service in calendar year 2012. 1040 ez 2011 (b) Trucks and vans. 1040 ez 2011 To determine the dollar limitations for trucks and vans first placed in service during calendar year 2012, the Service uses the new truck component of the CPI instead of the new car component. 1040 ez 2011 The new truck component of the CPI was 112. 1040 ez 2011 4 for October 1987 and 146. 1040 ez 2011 607 for October 2011. 1040 ez 2011 The October 2011 index exceeded the October 1987 index by 34. 1040 ez 2011 207. 1040 ez 2011 Therefore, the automobile price inflation adjustment for 2012 for trucks and vans is 30. 1040 ez 2011 43 percent (34. 1040 ez 2011 207/112. 1040 ez 2011 4 x 100%). 1040 ez 2011 The dollar limitations in § 280F(a) are multiplied by a factor of 0. 1040 ez 2011 3043, 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. 1040 ez 2011 This adjustment applies to all trucks and vans that are first placed in service in calendar year 2012. 1040 ez 2011 (2) Amount of the limitation. 1040 ez 2011 Tables 1 through 4 contain the dollar amount of the depreciation limitation for each taxable year for passenger automobiles a taxpayer places in service in calendar year 2012. 1040 ez 2011 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 2012 for which the § 168(k) additional first year depreciation deduction applies. 1040 ez 2011 Use Table 3 for a passenger automobile (other than a truck or van), and Table 4 for a truck or van, placed in service in calendar year 2012 for which the § 168(k) additional first year depreciation deduction does not apply. 1040 ez 2011 REV. 1040 ez 2011 PROC. 1040 ez 2011 2012-23 TABLE 1 DEPRECIATION LIMITATIONS FOR PASSENGER AUTOMOBILES (THAT ARE NOT TRUCKS OR VANS) PLACED IN SERVICE IN CALENDAR YEAR 2012 FOR WHICH THE § 168(k) ADDITIONAL FIRST YEAR DEPRECIATION DEDUCTION APPLIES Tax Year Amount 1st Tax Year $11,160 2nd Tax Year $5,100 3rd Tax Year $3,050 Each Succeeding Year $1,875 REV. 1040 ez 2011 PROC. 1040 ez 2011 2012-23 TABLE 2 DEPRECIATION LIMITATIONS FOR TRUCKS AND VANS PLACED IN SERVICE IN CALENDAR YEAR 2012 FOR WHICH THE § 168(k) ADDITIONAL FIRST YEAR DEPRECIATION DEDUCTION APPLIES Tax Year Amount 1st Tax Year $11,360 2nd Tax Year $5,300 3rd Tax Year $3,150 Each Succeeding Year $1,875 REV. 1040 ez 2011 PROC. 1040 ez 2011 2012-23 TABLE 3 DEPRECIATION LIMITATIONS FOR PASSENGER AUTOMOBILES (THAT ARE NOT TRUCKS OR VANS) PLACED IN SERVICE IN CALENDAR YEAR 2012 FOR WHICH THE § 168(k) ADDITIONAL FIRST YEAR DEPRECIATION DEDUCTION DOES NOT APPLY Tax Year Amount 1st Tax Year $3,160 2nd Tax Year $5,100 3rd Tax Year $3,050 Each Succeeding Year $1,875 REV. 1040 ez 2011 PROC. 1040 ez 2011 2012-23 TABLE 4 DEPRECIATION LIMITATIONS FOR TRUCKS AND VANS PLACED IN SERVICE IN CALENDAR YEAR 2012 FOR WHICH THE § 168(k) ADDITIONAL FIRST YEAR DEPRECIATION DEDUCTION DOES NOT APPLY Tax Year Amount 1st Tax Year $3,360 2nd Tax Year $5,300 3rd Tax Year $3,150 Each Succeeding Year $1,875 . 1040 ez 2011 02 Inclusions in Income of Lessees of Passenger Automobiles. 1040 ez 2011 A taxpayer must follow the procedures in § 1. 1040 ez 2011 280F-7(a) for determining the inclusion amounts for passenger automobiles first leased in calendar year 2012. 1040 ez 2011 In applying these procedures, lessees of passenger automobiles other than trucks and vans should use Table 5 of this revenue procedure, while lessees of trucks and vans should use Table 6 of this revenue procedure. 1040 ez 2011 REV. 1040 ez 2011 PROC. 1040 ez 2011 2012-23 TABLE 5 DOLLAR AMOUNTS FOR PASSENGER AUTOMOBILES (THAT ARE NOT TRUCKS OR VANS) WITH A LEASE TERM BEGINNING IN CALENDAR YEAR 2012 Fair Market Value of Passenger Automobile Tax Year During Lease Over Not Over 1st 2nd 3rd 4th 5th & Later $18,500 $19,000 2 4 5 6 8 19,000 19,500 2 4 7 7 9 19,500 20,000 2 5 8 8 10 20,000 20,500 3 5 9 10 11 20,500 21,000 3 6 9 12 12 21,000 21,500 3 7 10 12 14 21,500 22,000 3 8 11 13 16 22,000 23,000 4 8 13 15 17 23,000 24,000 4 10 15 17 20 24,000 25,000 5 11 17 19 23 25,000 26,000 6 12 19 21 26 26,000 27,000 6 14 20 24 28 27,000 28,000 7 15 22 26 31 28,000 29,000 7 16 25 28 33 29,000 30,000 8 18 25 32 35 30,000 31,000 9 19 27 34 38 31,000 32,000 9 20 30 36 41 32,000 33,000 10 21 32 38 43 33,000 34,000 10 23 33 41 46 34,000 35,000 11 24 35 43 49 35,000 36,000 12 25 37 45 52 36,000 37,000 12 27 39 47 54 37,000 38,000 13 28 41 49 57 38,000 39,000 13 29 43 52 59 39,000 40,000 14 30 45 54 62 40,000 41,000 14 32 47 56 65 41,000 42,000 15 33 49 58 68 42,000 43,000 16 34 51 61 70 43,000 44,000 16 36 52 63 73 44,000 45,000 17 37 54 66 75 45,000 46,000 17 38 57 67 78 46,000 47,000 18 39 59 70 80 47,000 48,000 19 40 61 72 83 48,000 49,000 19 42 62 75 86 49,000 50,000 20 43 64 77 89 50,000 51,000 20 45 66 79 91 51,000 52,000 21 46 68 81 94 52,000 53,000 21 47 70 84 96 53,000 54,000 22 48 72 86 99 54,000 55,000 23 49 74 88 102 55,000 56,000 23 51 76 90 104 56,000 57,000 24 52 78 92 107 57,000 58,000 24 54 79 95 110 58,000 59,000 25 55 81 97 113 59,000 60,000 26 56 83 100 115 60,000 62,000 26 58 86 103 119 62,000 64,000 28 60 90 108 124 64,000 66,000 29 63 94 112 129 66,000 68,000 30 66 97 117 135 68,000 70,000 31 68 102 121 140 70,000 72,000 32 71 105 126 145 72,000 74,000 33 74 109 130 151 74,000 76,000 35 76 113 135 156 76,000 78,000 36 78 117 140 161 78,000 80,000 37 81 120 145 166 80,000 85,000 39 86 127 152 176 85,000 90,000 42 92 137 163 189 90,000 95,000 45 98 147 175 202 95,000 100,000 48 105 155 187 215 100,000 110,000 52 115 170 203 235 110,000 120,000 58 127 189 227 262 120,000 130,000 64 140 208 250 288 130,000 140,000 70 153 227 272 315 140,000 150,000 75 166 246 296 340 150,000 160,000 81 179 265 318 368 160,000 170,000 87 192 284 341 394 170,000 180,000 93 204 304 364 420 180,000 190,000 99 217 323 387 446 190,000 200,000 105 230 342 409 473 200,000 210,000 111 243 361 432 499 210,000 220,000 116 256 380 455 526 220,000 230,000 122 269 399 478 552 230,000 240,000 128 282 418 501 578 240,000 and up 134 294 437 524 605 REV. 1040 ez 2011 PROC. 1040 ez 2011 2012-23 TABLE 6 DOLLAR AMOUNTS FOR TRUCKS AND VANS WITH A LEASE TERM BEGINNING IN CALENDAR YEAR 2012 Fair Market Value of Truck or Van Tax Year During Lease Over Not Over 1st 2nd 3rd 4th 5th & Later $19,000 $19,500 1 4 5 6 7 19,500 20,000 2 4 6 7 9 20,000 20,500 2 5 7 8 10 20,500 21,000 2 5 8 10 11 21,000 21,500 3 6 9 10 13 21,500 22,000 3 6 10 12 14 22,000 23,000 3 8 11 14 15 23,000 24,000 4 9 13 16 18 24,000 25,000 4 10 15 19 21 25,000 26,000 5 11 17 21 24 26,000 27,000 6 12 19 23 26 27,000 28,000 6 14 21 25 29 28,000 29,000 7 15 23 27 32 29,000 30,000 7 17 24 30 34 30,000 31,000 8 18 26 32 37 31,000 32,000 9 19 28 34 40 32,000 33,000 9 20 31 36 42 33,000 34,000 10 21 33 39 44 34,000 35,000 10 23 34 41 48 35,000 36,000 11 24 36 44 50 36,000 37,000 12 25 38 46 53 37,000 38,000 12 27 40 48 55 38,000 39,000 13 28 42 50 58 39,000 40,000 13 29 44 53 60 40,000 41,000 14 31 45 55 63 41,000 42,000 14 32 48 57 66 42,000 43,000 15 33 50 59 69 43,000 44,000 16 34 52 61 72 44,000 45,000 16 36 53 64 74 45,000 46,000 17 37 55 66 77 46,000 47,000 17 38 58 68 79 47,000 48,000 18 40 59 70 82 48,000 49,000 19 41 61 73 84 49,000 50,000 19 42 63 75 87 50,000 51,000 20 43 65 78 89 51,000 52,000 20 45 66 80 93 52,000 53,000 21 46 68 83 95 53,000 54,000 21 48 70 84 98 54,000 55,000 22 49 72 87 100 55,000 56,000 23 50 74 89 103 56,000 57,000 23 51 76 92 105 57,000 58,000 24 52 78 94 108 58,000 59,000 24 54 80 96 111 59,000 60,000 25 55 82 98 114 60,000 62,000 26 57 85 101 118 62,000 64,000 27 60 88 106 123 64,000 66,000 28 62 93 110 128 66,000 68,000 29 65 96 115 134 68,000 70,000 30 67 100 120 139 70,000 72,000 32 70 103 125 144 72,000 74,000 33 72 108 129 149 74,000 76,000 34 75 111 134 155 76,000 78,000 35 78 115 138 160 78,000 80,000 36 80 119 143 165 80,000 85,000 38 85 125 151 175 85,000 90,000 41 91 135 163 187 90,000 95,000 44 98 144 174 201 95,000 100,000 47 104 154 185 214 100,000 110,000 52 113 169 202 234 110,000 120,000 57 127 187 225 261 120,000 130,000 63 139 207 248 287 130,000 140,000 69 152 226 271 313 140,000 150,000 75 165 245 294 339 150,000 160,000 81 178 264 316 366 160,000 170,000 87 190 283 340 392 170,000 180,000 92 204 302 362 419 180,000 190,000 98 216 322 385 445 190,000 200,000 104 229 340 409 471 200,000 210,000 110 242 359 431 498 210,000 220,000 116 255 378 454 524 220,000 230,000 122 267 398 477 551 230,000 240,000 127 281 416 500 577 240,000 and up 133 294 435 523 603 SECTION 5. 1040 ez 2011 EFFECTIVE DATE This revenue procedure applies to passenger automobiles that a taxpayer first places in service or first leases during calendar year 2012. 1040 ez 2011 SECTION 6. 1040 ez 2011 DRAFTING INFORMATION The principal author of this revenue procedure is Bernard P. 1040 ez 2011 Harvey of the Office of Associate Chief Counsel (Income Tax & Accounting). 1040 ez 2011 For further information regarding this revenue procedure, contact Mr. 1040 ez 2011 Harvey at (202) 622-4930 (not a toll-free call). 1040 ez 2011 Prev  Up  Next   Home   More Internal Revenue Bulletins