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1040 Form 2011

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1040 Form 2011

1040 form 2011 13. 1040 form 2011   Payment of Taxes Table of Contents How To Make Deposits When To Make Deposits Amount of DepositsSafe Harbor Rule Generally, semimonthly deposits of excise taxes are required. 1040 form 2011 A semimonthly period is the first 15 days of a month (the first semimonthly period) or the 16th through the last day of a month (the second semimonthly period). 1040 form 2011 However, no deposit is required for the situations listed below; the taxes are payable with Form 720. 1040 form 2011 The net liability for taxes listed in Part I (Form 720) does not exceed $2,500 for the quarter. 1040 form 2011 The gas guzzler tax is being paid on a one-time filing. 1040 form 2011 The liability is for taxes listed in Part II (Form 720), except for the floor stocks tax which generally requires a single deposit. 1040 form 2011 How To Make Deposits Electronic deposit requirement. 1040 form 2011   You must use electronic funds transfer to make excise tax deposits. 1040 form 2011 Generally, electronic funds transfers are made using the Electronic Federal Tax Payment System (EFTPS). 1040 form 2011 If you do not want to use EFTPS, you can arrange for your tax professional, financial institution, payroll service, or other trusted third party to make deposits on your behalf. 1040 form 2011 Also, you may arrange for your financial institution to initiate a same-day wire payment on your behalf. 1040 form 2011   EFTPS is a free service provided by the Department of Treasury. 1040 form 2011 Services provided by your tax professional, financial institution, payroll service, or other third party may have a fee. 1040 form 2011 To get more information about EFTPS or to enroll in EFTPS, visit www. 1040 form 2011 eftps. 1040 form 2011 gov or call 1-800-555-4477. 1040 form 2011 Additional information about EFTPS is also available in Publication 966, Electronic Federal Tax Payment System: A Guide to Getting Started. 1040 form 2011    Depositing on time. 1040 form 2011 For EFTPS deposits to be on time, you must initiate the transaction at least 1 day before the date the deposit is due (before 8:00 p. 1040 form 2011 m. 1040 form 2011 Eastern time). 1040 form 2011 You will automatically be enrolled in EFTPS when you apply for an EIN. 1040 form 2011 You will receive a separate mailing containing instructions for activating your EFTPS enrollment after you receive your EIN. 1040 form 2011 When To Make Deposits There are two methods for determining deposits: the regular method and the alternative method. 1040 form 2011 The regular method applies to all taxes in Part I of Form 720 except for communications and air transportation taxes if deposits are based on amounts billed or tickets sold, rather than on amounts actually collected. 1040 form 2011 See Alternative method below. 1040 form 2011 If you are depositing more than one tax under a method, combine all the taxes under the method and make one deposit for the semimonthly period. 1040 form 2011 Regular method. 1040 form 2011   The deposit of tax for a semimonthly period is due by the 14th day following that period. 1040 form 2011 Generally, this is the 29th day of a month for the first semimonthly period and the 14th day of the following month for the second semimonthly period. 1040 form 2011 If the 14th or the 29th day falls on a Saturday, Sunday, or legal holiday, you must make the deposit by the immediately preceding day that is not a Saturday, Sunday, or legal holiday. 1040 form 2011 Alternative method (IRS Nos. 1040 form 2011 22, 26, 27, and 28). 1040 form 2011   Deposits of communications and air transportation taxes may be based on taxes included in amounts billed or tickets sold during a semimonthly period instead of on taxes actually collected during the period. 1040 form 2011 Under the alternative method, the tax included in amounts billed or tickets sold during a semimonthly period is considered collected during the first 7 days of the second following semimonthly period. 1040 form 2011 The deposit of tax is due by the 3rd banking day after the 7th day of that period. 1040 form 2011   For an example of the alternative method, see the Instructions for Form 720. 1040 form 2011 To use the alternative method, you must keep a separate account of the tax included in amounts billed or tickets sold during the month and report on Form 720 the tax included in amounts billed or tickets sold and not the amount of tax that is actually collected. 1040 form 2011 For example, amounts billed in December, January, and February are considered collected during January, February, and March and are reported on Form 720 as the tax for the 1st quarter of the calendar year. 1040 form 2011 The separate account for each month must reflect: All items of tax included in amounts billed or tickets sold during the month, and Other items of adjustment relating to tax for prior months (within the statute of limitations on credits or refunds). 1040 form 2011 The separate account for any month cannot include an adjustment resulting from a refusal to pay or inability to collect unless the refusal has been reported to the IRS. 1040 form 2011 See Uncollected Tax Report in chapter 4. 1040 form 2011 The net amount of tax that is considered collected during the semimonthly period must be either: The net amount of tax reflected in the separate account for the corresponding semimonthly period of the preceding month, or One-half of the net amount of tax reflected in the separate account for the preceding month. 1040 form 2011 Special rule for deposits of taxes in September. 1040 form 2011   See the Instructions for Form 720 for a special rule on deposits made in September. 1040 form 2011 Amount of Deposits Deposits for a semimonthly period generally must be at least 95% of the net tax liability for that period unless the safe harbor rule (discussed later) applies. 1040 form 2011 Generally, you do not have to make a deposit for a period in which you incurred no tax liability. 1040 form 2011 Net tax liability. 1040 form 2011   Your net tax liability is your tax liability for the period minus any claims on Schedule C (Form 720) for the period. 1040 form 2011 You may figure your net tax liability for a semimonthly period by dividing your net liability incurred during the calendar month by two. 1040 form 2011 If you use this method, you must use it for all semimonthly periods in the calendar quarter. 1040 form 2011 Do not reduce your liability by any amounts from Form 720X. 1040 form 2011 Safe Harbor Rule The safe harbor rule applies separately to deposits under the regular method and the alternative method. 1040 form 2011 Persons who filed Form 720 for the look-back quarter (the 2nd calendar quarter preceding the current quarter) are considered to meet the semimonthly deposit requirement if the deposit for each semimonthly period in the current quarter is at least 1/6 (16. 1040 form 2011 67%) of the net tax liability reported for the look-back quarter. 1040 form 2011 For the semimonthly period for which the additional deposit is required, the additional deposit must be at least 11/90 12. 1040 form 2011 23%), 10/90 (11. 1040 form 2011 12%) for non-EFTPS, of the net tax liability reported for the look-back quarter. 1040 form 2011 Also, the total deposit for that semimonthly period must be at least 1/6 (16. 1040 form 2011 67%) of the net tax liability reported for the look-back quarter. 1040 form 2011 Exceptions. 1040 form 2011   The safe harbor rule does not apply to: The 1st and 2nd quarters beginning on or after the effective date of an increase in the rate of tax unless the deposit of taxes for each semimonthly period in the calendar quarter is at least 1/6 (16. 1040 form 2011 67%) of the tax liability you would have had for the look-back quarter if the increased rate of tax had been in effect for that look-back quarter, Any quarter if liability includes any tax not in effect throughout the look-back quarter, or For deposits under the alternative method, any quarter if liability includes any tax not in effect throughout the look-back quarter and the month preceding the look-back quarter. 1040 form 2011 Requirements to be met. 1040 form 2011   For the safe harbor rule to apply, you must: Make each deposit timely at an authorized financial institution, and Pay any underpayment for the current quarter by the due date of the return. 1040 form 2011    The IRS may withdraw the right to make deposits of tax using the safe harbor rule from any person not complying with these rules. 1040 form 2011 Tax rate increases. 1040 form 2011   You must modify the safe harbor rule if there has been an increase in the rate of tax. 1040 form 2011 You must figure your tax liability in the look-back quarter as if the increased rate had been in effect. 1040 form 2011 To qualify for the safe harbor rule, your deposits cannot be less than 1/6 of the refigured tax liability. 1040 form 2011 Prev  Up  Next   Home   More Online Publications
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Page Last Reviewed or Updated: 07-Nov-2013

The 1040 Form 2011

1040 form 2011 4. 1040 form 2011   Filing U. 1040 form 2011 S. 1040 form 2011 Tax Returns Table of Contents Who Must FileFiling Requirement if Possession Income Is Excluded When To FileExtension of Time To File Where To File Special Rules for Completing Your U. 1040 form 2011 S. 1040 form 2011 Tax ReturnU. 1040 form 2011 S. 1040 form 2011 Armed Forces. 1040 form 2011 Deductions if Possession Income Is Excluded Foreign Tax Credit if Possession Income Is Excluded Self-Employment Tax Additional Medicare Tax Net Investment Income Tax Paying Your TaxesEstimated Tax Double TaxationCompetent Authority Assistance The information in chapter 3 will tell you if a U. 1040 form 2011 S. 1040 form 2011 income tax return is required for your situation. 1040 form 2011 If a U. 1040 form 2011 S. 1040 form 2011 return is required, your next step is to see if you meet the filing requirements. 1040 form 2011 If you do meet the filing requirements, the information presented in this chapter will help you understand the special procedures involved. 1040 form 2011 This chapter discusses: Filing requirements, When to file your return, Where to send your return, How to adjust your deductions and credits if you are excluding income from American Samoa or Puerto Rico, How to make estimated tax payments and pay self-employment tax, and How to request assistance in resolving instances of double taxation. 1040 form 2011 Who Must File If you are not required to file a possession tax return that includes your worldwide income, you must generally file a U. 1040 form 2011 S. 1040 form 2011 income tax return if your gross income is at least the amount shown in Table 4-1, later, for your filing status and age. 1040 form 2011 If you were a bona fide resident of American Samoa or Puerto Rico and are able to exclude your possession income from your U. 1040 form 2011 S. 1040 form 2011 tax return, your filing requirement may be less than the amount in Table 4-1. 1040 form 2011 For details, see the information under Filing Requirement if Possession Income Is Excluded , later. 1040 form 2011 Some individuals (such as those who can be claimed as a dependent on another person's return or who owe certain taxes, such as self-employment tax) must file a tax return even though the gross income is less than the amount shown in Table 4-1 for their filing status and age. 1040 form 2011 For more information, see the Form 1040 instructions. 1040 form 2011 Filing Requirement if Possession Income Is Excluded If you were a bona fide resident of American Samoa or Puerto Rico and qualify to exclude possession income on your U. 1040 form 2011 S. 1040 form 2011 tax return, you must determine your adjusted filing requirement. 1040 form 2011 Generally, your filing requirement is based on the total of your (and your spouse's if filing a joint return) personal exemption(s) plus your standard deduction. 1040 form 2011 Personal exemption. 1040 form 2011   When figuring your filing requirement, your personal exemption is allowed in full. 1040 form 2011 Do not reduce it for this purpose. 1040 form 2011 Do not include exemptions for your dependents. 1040 form 2011 Allowable standard deduction. 1040 form 2011   Unless your filing status is married filing separately, the minimum income level at which you must file a return is based, in part, on the standard deduction for your filing status and age. 1040 form 2011 Because the standard deduction applies to all types of income, it must be divided between your excluded income and income from other sources. 1040 form 2011 Multiply the regular standard deduction for your filing status and age (this is zero if you are married filing a separate return; all others, see Form 1040 instructions) by the following fraction:      Gross income subject to U. 1040 form 2011 S. 1040 form 2011 income tax     Gross income from all sources (including excluded possession income)   Example. 1040 form 2011 Barbara Spruce, a U. 1040 form 2011 S. 1040 form 2011 citizen, is single, under 65, and a bona fide resident of American Samoa. 1040 form 2011 During 2013, she received $20,000 of income from American Samoa sources (qualifies for exclusion) and $8,000 of income from sources outside the possession (subject to U. 1040 form 2011 S. 1040 form 2011 income tax). 1040 form 2011 Her allowable standard deduction for 2013 is figured as follows:   $8,000 $28,000 × $6,100 (regular standard deduction) = $1,743   Adjusted filing requirement. 1040 form 2011   Figure your adjusted filing requirement by adding the amount of your allowable standard deduction to the amount of your personal exemption. 1040 form 2011 You must file a U. 1040 form 2011 S. 1040 form 2011 income tax return if your gross income is at least the amount shown on line 3 of the following worksheet. 1040 form 2011    1. 1040 form 2011 Enter the allowable standard deduction you figured earlier under Allowable standard deduction . 1040 form 2011 If your filing status is married filing separately, enter -0-   2. 1040 form 2011 Personal exemption. 1040 form 2011 If your filing status is married filing jointly, enter $7,800; if someone can claim you as a dependent, enter -0-; otherwise, enter $3,900   3. 1040 form 2011 Add lines 1 and 2. 1040 form 2011 You must file a U. 1040 form 2011 S. 1040 form 2011 income tax return if your gross income from sources outside the relevant possession is at least this amount   Table 4-1. 1040 form 2011 2013 Filing Requirements Chart for Most Taxpayers IF your filing status is. 1040 form 2011 . 1040 form 2011 . 1040 form 2011 AND at the end of 2013 you were*. 1040 form 2011 . 1040 form 2011 . 1040 form 2011 THEN file a return if your gross income** was at least. 1040 form 2011 . 1040 form 2011 . 1040 form 2011 single under 65 $10,000 65 or older $11,500 married filing jointly*** under 65 (both spouses) $20,000 65 or older (one spouse) $21,200 65 or older (both spouses) $22,400 married filing separately any age $3,900 head of household under 65 $12,850 65 or older $14,350 qualifying widow(er)  with dependent child under 65 $16,100 65 or older $17,300 * If you were born on January 1, 1949, you are considered to be age 65 at the end of 2013. 1040 form 2011 ** Gross income means all income you received in the form of money, goods, property, and services that is not exempt from tax, including any income from sources outside the United States (even if you can exclude part or all of it). 1040 form 2011 Do not include social security benefits unless (a) you are married filing a separate return and you lived with your spouse at any time during 2013, or (b) one-half of your social security benefits plus your other gross income is more than $25,000 ($32,000 if married filing jointly). 1040 form 2011 If (a) or (b) applies, see the instructions for Form 1040 or Publication 915, Social Security and Equivalent Railroad Retirement Benefits, to figure the taxable part of social security benefits you must include in gross income. 1040 form 2011 *** If you did not live with your spouse at the end of 2013 (or on the date your spouse died) and your gross income was at least $3,900 you must file a return regardless of your age. 1040 form 2011 Example 1. 1040 form 2011 James and Joan Thompson, one over 65, are U. 1040 form 2011 S. 1040 form 2011 citizens and bona fide residents of Puerto Rico during the entire tax year. 1040 form 2011 They file a joint income tax return. 1040 form 2011 During 2013, they received $35,000 of income from Puerto Rico sources (qualifies for exclusion) and $6,000 of income from sources outside Puerto Rico (subject to U. 1040 form 2011 S. 1040 form 2011 income tax). 1040 form 2011 Their allowable standard deduction for 2013 is figured as follows:   $6,000 $41,000 × $13,400 ( standard deduction for 65 or older (one spouse) ) = $1,961   The Thompsons do not have to file a U. 1040 form 2011 S. 1040 form 2011 income tax return because their gross income subject to U. 1040 form 2011 S. 1040 form 2011 tax ($6,000) is less than their allowable standard deduction plus their personal exemptions ($1,961+ $7,800= $9,761). 1040 form 2011 Example 2. 1040 form 2011 Barbara Spruce (see Example under Allowable standard deduction, earlier), however, must file a U. 1040 form 2011 S. 1040 form 2011 income tax return because her gross income subject to U. 1040 form 2011 S. 1040 form 2011 tax ($8,000) is more than her allowable standard deduction plus her personal exemption ($1,743 + $3,900 = $5,643). 1040 form 2011 If you must file a U. 1040 form 2011 S. 1040 form 2011 income tax return, you may be able to file a paperless return using IRS e-file. 1040 form 2011 See your form instructions or visit our website at IRS. 1040 form 2011 gov. 1040 form 2011 When To File If you file on a calendar year basis, the due date for filing your U. 1040 form 2011 S. 1040 form 2011 income tax return is April 15 following the end of your tax year. 1040 form 2011 If you use a fiscal year (a year ending on the last day of a month other than December), the due date is the 15th day of the 4th month after the end of your fiscal year. 1040 form 2011 If any due date falls on a Saturday, Sunday, or legal holiday, your tax return is due on the next business day. 1040 form 2011 For your 2013 tax return, the due date is April 15, 2014. 1040 form 2011 If you mail your federal tax return, it is considered timely if it bears an official postmark dated on or before the due date, including any extensions. 1040 form 2011 If you use a private delivery service designated by the IRS, generally the postmark date is the date the private delivery service records in its database or marks on the mailing label. 1040 form 2011 See your form instructions for a list of designated private delivery services. 1040 form 2011 Extension of Time To File You can get an extension of time to file your U. 1040 form 2011 S. 1040 form 2011 income tax return. 1040 form 2011 Special rules apply for those living outside the United States. 1040 form 2011 Automatic 6-Month Extension If you cannot file your 2013 return by the due date, you can get an automatic 6-month extension of time to file. 1040 form 2011 Example. 1040 form 2011 If your return must be filed by April 15, 2014, you will have until October 15, 2014, to file. 1040 form 2011 Although you are not required to make a payment of the tax you estimate as due, Form 4868 does not extend the time to pay taxes. 1040 form 2011 If you do not pay the amount due by the regular due date (generally April 15), you will owe interest on any unpaid tax from the original due date to the date you pay the tax. 1040 form 2011 You may also be charged penalties (see the Instructions for Form 4868). 1040 form 2011 How to get the automatic extension. 1040 form 2011   You can get the automatic 6-month extension if you do one of the following by the due date for filing your return. 1040 form 2011 E-file Form 4868 using your personal computer or a tax professional. 1040 form 2011 E-file and pay by credit or debit card. 1040 form 2011 Your payment must be at least $1. 1040 form 2011 You may pay by phone or over the Internet. 1040 form 2011 Do not file Form 4868. 1040 form 2011 File a paper Form 4868. 1040 form 2011 If you are a fiscal year taxpayer, you must file a paper Form 4868. 1040 form 2011 See Form 4868 for information on getting an extension using these options. 1040 form 2011 When to file. 1040 form 2011   You must request the automatic extension by the due date for your return. 1040 form 2011 You can file your return any time before the 6-month extension period ends. 1040 form 2011 When you file your return. 1040 form 2011   Enter any payment you made related to the extension of time to file on Form 1040, line 68. 1040 form 2011 If you file Form 1040A, U. 1040 form 2011 S. 1040 form 2011 Individual Income Tax Return, or Form 1040EZ, Income Tax Return for Single and Joint Filers With No Dependents, include that payment in your total payments on Form 1040A, line 41, or Form 1040EZ, line 9. 1040 form 2011 Also enter “Form 4868” and the amount paid in the space to the left of the entry space for line 41 or line 9. 1040 form 2011 You cannot ask the Internal Revenue Service to figure your tax if you use the extension of time to file. 1040 form 2011 Individuals Outside the United States and Puerto Rico You are allowed an automatic 2-month extension (until June 16, 2014, if you use the calendar year) to file your 2013 return and pay any federal income tax due if: You are a U. 1040 form 2011 S. 1040 form 2011 citizen or resident, and On the due date of your return: You are living outside of the United States and Puerto Rico, and your main place of business or post of duty is outside the United States and Puerto Rico, or You are in military or naval service on duty outside the United States and Puerto Rico. 1040 form 2011 However, if you pay the tax due after the regular due date (generally April 15), interest will be charged from April 15 until the date the tax is paid. 1040 form 2011 If you serve in a combat zone or qualified hazardous duty area, you may be eligible for a longer extension of time to file. 1040 form 2011 For more information, see Publication 3, Armed Forces' Tax Guide. 1040 form 2011 Married taxpayers. 1040 form 2011   If you file a joint return, only one spouse has to qualify for this automatic extension. 1040 form 2011 However, if you and your spouse file separate returns, this automatic extension applies only to the spouse who qualifies. 1040 form 2011 How to get the extension. 1040 form 2011   To use this special automatic extension, you must attach a statement to your return explaining what situation qualified you for the extension. 1040 form 2011 (See the situations listed under (2), earlier. 1040 form 2011 ) Extension beyond 2 months. 1040 form 2011   If you cannot file your 2013 return within the automatic 2-month extension period, you can get an additional 4-month extension, for a total of 6 months. 1040 form 2011 File Form 4868 by the end of the automatic extension period (June 16, 2014 for calendar year taxpayers). 1040 form 2011 Be sure to check the box on Form 4868, line 8, if appropriate. 1040 form 2011   In addition to this 6-month extension, taxpayers who are out of the country (as defined under (2) earlier) can request a discretionary 2-month additional extension of time to file their returns (to December 15 for calendar year taxpayers). 1040 form 2011   To request this extension, you must send the IRS a letter explaining the reasons why you need the additional 2 months. 1040 form 2011 Send the letter by the extended due date (October 15 for calendar year taxpayers) to:  Department of the Treasury Internal Revenue Service Austin, TX 73301-0215 USA   You will not receive any notification from the IRS unless your request is denied for being untimely. 1040 form 2011 Where To File Use the addresses listed below if you have to file Form 1040 with the United States and you are excluding possession income from American Samoa or Puerto Rico. 1040 form 2011 If you are not including a check or a money order, send your U. 1040 form 2011 S. 1040 form 2011 tax return and all attachments to:   Department of the Treasury Internal Revenue Service Austin, TX 73301-0215 USA If you are including a check or a money order, send your U. 1040 form 2011 S. 1040 form 2011 tax return and all attachments to:  Internal Revenue Service P. 1040 form 2011 O. 1040 form 2011 Box 1303 Charlotte, NC 28201-1303 USA Also send your U. 1040 form 2011 S. 1040 form 2011 return to these addresses if you are attaching Form 5074 or Form 8689. 1040 form 2011 If you are not in either of the above categories, send your return to the address shown in the Form 1040 instructions for the possession or state in which you reside. 1040 form 2011 Special Rules for Completing Your U. 1040 form 2011 S. 1040 form 2011 Tax Return If you are not excluding possession income from your U. 1040 form 2011 S. 1040 form 2011 tax return, follow the instructions for the specific forms you file. 1040 form 2011 However, you may not qualify to claim the earned income credit (EIC). 1040 form 2011 Earned income credit. 1040 form 2011   Even if you maintain a household in one of the possessions discussed in this publication that is your main home and the home of your qualifying child, you cannot claim the earned income credit on your U. 1040 form 2011 S. 1040 form 2011 tax return. 1040 form 2011 This credit is available only if you maintain the household in the United States or you are serving on extended active duty in the U. 1040 form 2011 S. 1040 form 2011 Armed Forces. 1040 form 2011 U. 1040 form 2011 S. 1040 form 2011 Armed Forces. 1040 form 2011   U. 1040 form 2011 S. 1040 form 2011 military personnel stationed outside the United States on extended active duty are considered to live in the United States during that duty period for purposes of the EIC. 1040 form 2011 Extended active duty means you are called or ordered to duty for an indefinite period or for a period of more than 90 days. 1040 form 2011 Once you begin serving your extended active duty, you are still considered to have been on extended active duty even if you do not serve more than 90 days. 1040 form 2011 Income from American Samoa or Puerto Rico excluded. 1040 form 2011   You will not be allowed to take deductions and credits that apply to the excluded income. 1040 form 2011 The additional information you need follows. 1040 form 2011 Deductions if Possession Income Is Excluded Deductions that specifically apply to your excluded possession income, such as employee business expenses, are not allowable on your U. 1040 form 2011 S. 1040 form 2011 income tax return. 1040 form 2011 Deductions that do not specifically apply to any particular type of income must be divided between your excluded income from sources in the relevant possession and income from all other sources to find the part that you can deduct on your U. 1040 form 2011 S. 1040 form 2011 tax return. 1040 form 2011 Examples of such deductions are alimony payments, the standard deduction, and certain itemized deductions (such as medical expenses, charitable contributions, real estate taxes, and mortgage interest on your home). 1040 form 2011 Figuring the deduction. 1040 form 2011   To find the part of a deduction that is allowable, multiply the deduction by the following fraction. 1040 form 2011   Gross income subject to U. 1040 form 2011 S. 1040 form 2011 income tax     Gross income from all sources (including excluded possession income)   Adjustments to Income Your adjusted gross income equals your gross income minus certain deductions (adjustments). 1040 form 2011 Moving expense deduction. 1040 form 2011   Generally, expenses of a move to a possession are directly attributable to wages, salaries, and other earned income from that possession. 1040 form 2011 Likewise, the expenses of a move back to the United States are generally attributable to U. 1040 form 2011 S. 1040 form 2011 earned income. 1040 form 2011   If you are claiming expenses for a move to a relevant possession, how and where you will deduct the expenses depends on your status as a bona fide resident and if any of your possession income is excluded on your U. 1040 form 2011 S. 1040 form 2011 tax return. 1040 form 2011 For more information, see Moving expense deduction in chapter 3 under the name of the relevant possession. 1040 form 2011   If you are claiming expenses for a move from a U. 1040 form 2011 S. 1040 form 2011 possession to the United States, use Form 3903 to figure your deductible expenses and enter the amount on Form 1040, line 26. 1040 form 2011 For purposes of deducting moving expenses, the possessions are considered part of the United States. 1040 form 2011 See Publication 521, Moving Expenses, for information about what expenses are deductible. 1040 form 2011 Self-employment tax deduction. 1040 form 2011   Generally, if you are reporting self-employment income on your U. 1040 form 2011 S. 1040 form 2011 return, you can include the deductible part of your self-employment tax on Form 1040, line 27. 1040 form 2011 This is an income tax deduction only; it is not a deduction in figuring net earnings from self-employment (for self-employment tax). 1040 form 2011   However, if you are a bona fide resident of American Samoa or Puerto Rico and you exclude all of your self-employment income from gross income, you cannot take the deduction on Form 1040, line 27, because the deduction is related to excluded income. 1040 form 2011   If only part of your self-employment income is excluded, the part of the deduction that is based on the nonexcluded income is allowed. 1040 form 2011 This would happen if, for instance, you have two businesses and only the income from one of them is excludable. 1040 form 2011   For purposes of the deduction only, figure the self-employment tax on the nonexcluded income by multiplying your total self-employment tax (from Schedule SE (Form 1040)), Self-Employment Tax) by the following fraction. 1040 form 2011   Self-employment income subject to U. 1040 form 2011 S. 1040 form 2011 income tax     Total self-employment income (including excluded possession income)   The result is your self-employment tax on nonexcluded income. 1040 form 2011 Include the deductible part of this amount on Form 1040, line 27. 1040 form 2011 Individual retirement arrangement (IRA) deduction. 1040 form 2011   Do not take excluded income into account when figuring your deductible IRA contribution. 1040 form 2011 Standard Deduction The standard deduction is composed of the regular standard deduction amount and the additional standard deduction for taxpayers who are blind or age 65 or over. 1040 form 2011 To find the amount you can claim on Form 1040, line 40, first figure your full standard deduction according to the Instructions for Form 1040. 1040 form 2011 Then multiply your full standard deduction by the following fraction. 1040 form 2011   Gross income subject to U. 1040 form 2011 S. 1040 form 2011 income tax     Gross income from all sources (including excluded possession income)   In the space above line 40, enter “Standard deduction modified due to income excluded under section 931 (if American Samoa) or section 933 (if Puerto Rico). 1040 form 2011 ” This calculation may not be the same as the one you used to determine if you need to file a U. 1040 form 2011 S. 1040 form 2011 tax return. 1040 form 2011 Itemized Deductions Most itemized deductions do not apply to a particular type of income. 1040 form 2011 However, itemized deductions can be divided into three categories. 1040 form 2011 Those that apply specifically to excluded income, such as employee business expenses, are not deductible. 1040 form 2011 Those that apply specifically to income subject to U. 1040 form 2011 S. 1040 form 2011 income tax, which might also be employee business expenses, are fully allowable under the Instructions for Schedule A (Form 1040), Itemized Deductions. 1040 form 2011 Those that do not apply to specific income must be allocated between your gross income subject to U. 1040 form 2011 S. 1040 form 2011 income tax and your total gross income from all sources. 1040 form 2011 The example given later shows how to figure the deductible part of each type of expense that is not related to specific income. 1040 form 2011 Example. 1040 form 2011 In 2013, you and your spouse are both under 65 and U. 1040 form 2011 S. 1040 form 2011 citizens who are bona fide residents of Puerto Rico during the entire tax year. 1040 form 2011 You file a joint income tax return. 1040 form 2011 During 2013, you earned $20,000 from Puerto Rican sources (excluded from U. 1040 form 2011 S. 1040 form 2011 gross income) and your spouse earned $60,000 from the U. 1040 form 2011 S. 1040 form 2011 Government. 1040 form 2011 You have $16,000 of itemized deductions that do not apply to any specific type of income. 1040 form 2011 These are medical expenses of $4,000, real estate taxes of $5,000, home mortgage interest of $6,000, and charitable contributions of $1,000 (cash contributions). 1040 form 2011 You determine the amount of each deduction that you can claim on your Schedule A (Form 1040), Itemized Deductions, by multiplying the deduction by the fraction shown under Figuring the deduction , earlier under Deductions if Possession Income is Excluded. 1040 form 2011   Medical Expenses   $60,000$80,000 × $4,000 = $3,000  (enter on line 1  of Schedule A)     Real Estate Taxes   $60,000$80,000 × $5,000 = $3,750  (enter on line 6  of Schedule A)     Home Mortgage Interest   $60,000$80,000 × $6,000 = $4,500  (enter on line 10 or 11 of  Schedule A)     Charitable Contributions (cash contributions)   $60,000$80,000 × $1,000 = $750  (enter on line 16 of Schedule A)   Enter on Schedule A (Form 1040) only the allowable portion of each deduction. 1040 form 2011 Overall limitation on itemized deductions. 1040 form 2011   If your adjusted gross income (discussed earlier) is over $300,000 if married filing jointly or qualifying widow(er); $275,000 if head of household; $250,000 if single; or $150,000 if married filing separately; see the Itemized Deductions Worksheet in the Instructions for Schedule A (Form 1040), to figure your itemized deductions. 1040 form 2011 Personal Exemptions Personal exemptions are allowed in full even if excluding possession income. 1040 form 2011 However, depending upon your adjusted gross income and filing status, the amount you can deduct may be reduced. 1040 form 2011 See the Deduction for Exemptions Worksheet—Line 42 in the instructions for Form 1040. 1040 form 2011 Foreign Tax Credit if Possession Income Is Excluded If you must report American Samoa or Puerto Rico source income on your U. 1040 form 2011 S. 1040 form 2011 tax return, you can claim a foreign tax credit for income taxes paid to the possession on that income. 1040 form 2011 However, you cannot claim a foreign tax credit for taxes paid on possession income that is excluded on your U. 1040 form 2011 S. 1040 form 2011 tax return. 1040 form 2011 The foreign tax credit is generally figured on Form 1116. 1040 form 2011 If you have income, such as U. 1040 form 2011 S. 1040 form 2011 Government wages, that is not excludable, and you also have possession source income that is excludable, you must figure the credit by reducing your foreign taxes paid or accrued by the taxes based on the excluded income. 1040 form 2011 You make this reduction for each separate income category. 1040 form 2011 To find the amount of this reduction, use the following formula for each income category. 1040 form 2011 Excluded income from possession sources less deductible expenses based on that income x Tax paid or accrued to the possession = Reduction in foreign taxes Total income subject to possession tax less deductible expenses based on that income Enter the amount of the reduction on Form 1116, line 12. 1040 form 2011 For more information on the foreign tax credit, see Publication 514. 1040 form 2011 Example. 1040 form 2011 Jason and Lynn Reddy are U. 1040 form 2011 S. 1040 form 2011 citizens who were bona fide residents of Puerto Rico during all of 2013. 1040 form 2011 They file a joint tax return. 1040 form 2011 The following table shows their excludable and taxable income for U. 1040 form 2011 S. 1040 form 2011 federal income tax purposes. 1040 form 2011   Taxable   Excludable Jason's wages from  U. 1040 form 2011 S. 1040 form 2011 Government $25,000     Lynn's wages from Puerto Rico  corp. 1040 form 2011     $15,000 Dividend from Puerto Rico corp. 1040 form 2011 doing business in Puerto Rico     200 Dividend from U. 1040 form 2011 S. 1040 form 2011  corp. 1040 form 2011 doing business  in U. 1040 form 2011 S. 1040 form 2011 * 1,000     Totals $26,000   $15,200 * Income from sources outside Puerto Rico is taxable. 1040 form 2011   Jason and Lynn must file 2013 income tax returns with both Puerto Rico and the United States. 1040 form 2011 They have gross income of $26,000 for U. 1040 form 2011 S. 1040 form 2011 tax purposes. 1040 form 2011 They paid taxes to Puerto Rico of $4,000 ($3,980 on their wages and $20 on the dividend from the Puerto Rico corporation). 1040 form 2011 They figure their foreign tax credit on two Forms 1116, which they must attach to their U. 1040 form 2011 S. 1040 form 2011 return. 1040 form 2011 They fill out one Form 1116 for wages and one Form 1116 for the dividend. 1040 form 2011 Jason and Lynn figure the Puerto Rico taxes on excluded income as follows. 1040 form 2011   Wages: ($15,000 ÷ $40,000) × $3,980 = $1,493   Dividend: ($200 ÷ $200) × $20 = $20 They enter $1,493 on Form 1116, line 12, for wages and $20 on the second Form 1116, line 12, for the dividend. 1040 form 2011 Self-Employment Tax Self-employment tax includes both social security and Medicare taxes for individuals who are self-employed. 1040 form 2011 A U. 1040 form 2011 S. 1040 form 2011 citizen or resident alien who is self-employed must pay self-employment tax on net self-employment earnings of $400 or more. 1040 form 2011 This rule applies whether or not the earnings are excludable from gross income (or whether or not a U. 1040 form 2011 S. 1040 form 2011 income tax return must otherwise be filed). 1040 form 2011 Bona fide residents of the possessions discussed in this publication are considered U. 1040 form 2011 S. 1040 form 2011 residents for this purpose and are subject to the self-employment tax. 1040 form 2011 Forms to file. 1040 form 2011   If you have net self-employment income and are subject to self-employment tax, file one of the following with the United States. 1040 form 2011 If you are required to file Form 1040 with the United States, complete Schedule SE (Form 1040) and attach it to your Form 1040. 1040 form 2011 If you are not required to file Form 1040 with the United States and you are a bona fide resident of American Samoa, the CNMI, Guam, Puerto Rico, or the USVI, file Form 1040-SS. 1040 form 2011 If you are a resident of Puerto Rico, you can file the Spanish-language Form 1040-PR instead. 1040 form 2011 Do not file forms 1040-SS or 1040-PR with Form 1040. 1040 form 2011 If you are required to pay Additional Medicare Tax (discussed later) on your self-employment income, attach Form 8959, Additional Medicare Tax to Form 1040, Form 1040-SS, or Form 1040-PR, as applicable. 1040 form 2011 Chapter 11 Bankruptcy cases. 1040 form 2011   While you are a debtor in a chapter 11 bankruptcy case, your net profit or loss from self-employment will be included on the income tax return (Form 1041, U. 1040 form 2011 S. 1040 form 2011 Income Tax Return for Estates and Trusts) of the bankruptcy estate. 1040 form 2011 However, you—not the bankruptcy estate—are responsible for paying self-employment tax on your net earnings from self-employment. 1040 form 2011   Use Schedule SE (Form 1040), Form 1040-SS, or Form 1040-PR, as determined above, to figure your correct amount of self-employment tax. 1040 form 2011   For other reporting requirements, see Chapter 11 Bankruptcy Cases in the Instructions for Form 1040. 1040 form 2011 Additional Medicare Tax Beginning in 2013, a 0. 1040 form 2011 9% Additional Medicare Tax applies to Medicare wages, railroad retirement (RRTA) compensation, and self-employment income that are more than: $125,000 if married filing separately, $250,000 if married filing jointly, or $200,000 if single, head of household, or qualifying widow(er). 1040 form 2011 Medicare wages and self-employment income are combined to determine if income exceeds the threshold. 1040 form 2011 A self-employment loss should not be considered for purposes of this tax. 1040 form 2011 RRTA compensation should be separately compared to the threshold. 1040 form 2011 Your employer is responsible for withholding the 0. 1040 form 2011 9% Additional Medicare Tax on Medicare wages or RRTA compensation it pays to you in excess of $200,000. 1040 form 2011 You should consider this withholding, if applicable, in determining whether you need to make estimated tax payments. 1040 form 2011 There are no special rules for U. 1040 form 2011 S. 1040 form 2011 citizens and nonresident aliens living abroad for purposes of this provision. 1040 form 2011 Wages, RRTA compensation, and self-employment income that are subject to Medicare tax will also be subject to Additional Medicare Tax if in excess of the applicable threshold. 1040 form 2011 For more information, see Form 8959, Additional Medicare Tax, and its instructions or visit www. 1040 form 2011 irs. 1040 form 2011 gov and enter the following words in the search box: Additional Medicare Tax. 1040 form 2011 You cannot include the Additional Medicare Tax as a deductible part of your self-employment tax. 1040 form 2011 Net Investment Income Tax Beginning in 2013, the Net Investment Income Tax (NIIT) imposes a 3. 1040 form 2011 8% tax on the lesser of an individual’s net investment income or the excess of the individual’s modified adjusted gross income over a specified threshold amount. 1040 form 2011 Bona fide residents of Puerto Rico and American Samoa who may have a federal income tax return filing obligation may be liable for the NIIT if the taxpayer’s modified adjusted gross income from non-territory sources exceeds a specified threshold amount. 1040 form 2011 The NIIT does not apply to any individual who is a nonresident alien with respect to the United States. 1040 form 2011 Bona fide residents must take into account any additional tax liability associated with the NIIT when calculating your estimated tax payments. 1040 form 2011 Forms to file. 1040 form 2011   If you are a bona fide resident of American Samoa and Puerto Rico and you are required to pay the NIIT, you must file Form 1040 with the United States and attach Form 8960, Net Investment Income Tax—Individuals, Estates, and Trusts. 1040 form 2011 For more information, see Form 8960 and its instructions. 1040 form 2011 Paying Your Taxes You may find that not all of your income tax has been paid through withholding by either the United States or the possession. 1040 form 2011 This is often true if you have income that is not subject to withholding, such as self-employment, interest, or rental income. 1040 form 2011 In this situation, you may need to make estimated tax payments. 1040 form 2011 Estimated Tax If your estimated income tax obligation is to the United States, use the worksheet in the Form 1040-ES package to figure your estimated tax, including self-employment tax. 1040 form 2011 Include the Additional Medicare Tax and Net Investment Income Tax if applicable. 1040 form 2011 If you are paying by check or money order, use the payment vouchers in the Form 1040-ES package. 1040 form 2011 Or, you can make your payments electronically and not have to file any paper forms. 1040 form 2011 See the Form 1040-ES instructions for information on making payments. 1040 form 2011 Double Taxation Mutual agreement procedures exist to settle issues where there is inconsistent tax treatment between the IRS and the taxing authorities of the following possessions. 1040 form 2011 American Samoa. 1040 form 2011 The Commonwealth of Puerto Rico. 1040 form 2011 The Commonwealth of the Northern Mariana Islands. 1040 form 2011 Guam. 1040 form 2011 The U. 1040 form 2011 S. 1040 form 2011 Virgin Islands. 1040 form 2011 These issues usually involve allocations of income, deductions, credits, or allowances between related persons; determinations of residency; and determinations of the source of income and related expenses. 1040 form 2011 Competent Authority Assistance The tax coordination agreements between the United States and the possession tax departments contain provisions allowing the competent authorities of the United States and the relevant possession to resolve, by mutual agreement, inconsistent tax treatment by the two jurisdictions. 1040 form 2011 How to make your request. 1040 form 2011   Your request for competent authority assistance must include all the information listed in Revenue Procedure 2006-23, 2006-20 I. 1040 form 2011 R. 1040 form 2011 B. 1040 form 2011 900 available at www. 1040 form 2011 irs. 1040 form 2011 gov/pub/irs-irbs/irb06-49. 1040 form 2011 pdf. 1040 form 2011    Also, see Notice 2013-78, which provides proposed updates to the procedures for requesting U. 1040 form 2011 S. 1040 form 2011 competent authority assistance under tax treaties. 1040 form 2011 As noted, an update to Revenue Procedure 2006-23 will be published in the future. 1040 form 2011   Your request must be in the form of a letter addressed to the Deputy Commissioner (International) LB&I. 1040 form 2011 It must contain a statement that competent authority assistance is requested under the mutual agreement procedure with the possession. 1040 form 2011 You (or a person having authority to sign your federal return) must sign and date the request. 1040 form 2011    Send your written request for U. 1040 form 2011 S. 1040 form 2011 assistance under this procedure to:   Deputy Commissioner (International) Large Business and International Division Internal Revenue Service 1111 Constitution Avenue, N. 1040 form 2011 W. 1040 form 2011  Routing: M4-365 Washington, DC 20224 (Attention: TAIT) Nonresident aliens generally must present their initial request for assistance to the relevant possession tax agency. 1040 form 2011 Credit or Refund In addition to the tax assistance request, if you seek a credit or refund of any overpayment of U. 1040 form 2011 S. 1040 form 2011 tax paid on the income in question, you should file a claim on Form 1040X, Amended U. 1040 form 2011 S. 1040 form 2011 Individual Income Tax Return. 1040 form 2011 Indicate on the form that a request for assistance under the mutual agreement procedure with the possession has been filed. 1040 form 2011 Attach a copy of the request to the form. 1040 form 2011 Also, you should take whatever steps must be taken under the possession tax code to prevent the expiration of the statutory period for filing a claim for credit or refund of a possession tax. 1040 form 2011 See Revenue Procedure 2006-54 (or its successor), section 9, for complete information. 1040 form 2011 Prev  Up  Next   Home   More Online Publications