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1040ez efile free Publication 947 - Introductory Material Table of Contents What's New Practitioners' Hotline IntroductionOrdering forms and publications. 1040ez efile free Tax questions. 1040ez efile free Useful Items - You may want to see: What's New Registered tax return preparers. 1040ez efile free  Registered tax return preparers may prepare and sign as the preparer tax returns and claims for refund and other documents for submission to the IRS. 1040ez efile free They may also represent taxpayers before revenue agents, customer service representatives, and similar IRS employees during an examination if they signed the return or claim for refund for the tax year or period under examination. 1040ez efile free Future developments. 1040ez efile free  The IRS has created a page on IRS. 1040ez efile free gov for information about Publication 947 at www. 1040ez efile free irs. 1040ez efile free gov/pub947. 1040ez efile free Information about any future developments (such as legislation enacted after we release it) will be posted on that page. 1040ez efile free Practitioners' Hotline The Practitioner Priority Service® is a nationwide, toll-free hotline that provides professional support to practitioners with account-related questions. 1040ez efile free The toll-free number for this service is 1-866-860-4259. 1040ez efile free Introduction This publication discusses who can represent a taxpayer before the IRS and what forms or documents are used to authorize a person to represent a taxpayer. 1040ez efile free Usually, attorneys, certified public accountants (CPAs), enrolled agents, enrolled retirement plan agents, and enrolled actuaries can represent taxpayers before the IRS. 1040ez efile free Under special circumstances, other individuals, including registered tax return preparers, unenrolled return preparers, and students can represent taxpayers before the IRS. 1040ez efile free For details regarding taxpayer representation, see Who Can Practice Before the IRS, later. 1040ez efile free Definitions. 1040ez efile free   Many of the terms used in this publication, such as “enrolled agent” and “practitioner” are defined in the Glossary at the back of this publication. 1040ez efile free Comments and suggestions. 1040ez efile free   We welcome your comments about this publication and your suggestions for future editions. 1040ez efile free   You can write to us at the following address: Internal Revenue Service Individual Forms and Publications Branch SE:W:CAR:MP:T:I 1111 Constitution Ave. 1040ez efile free NW, IR-6526 Washington, DC 20224   We respond to many letters by telephone. 1040ez efile free Therefore, it would be helpful if you would include your daytime phone number, including the area code, in your correspondence. 1040ez efile free   You can email us at taxforms@irs. 1040ez efile free gov . 1040ez efile free Please put “Publications Comment” on the subject line. 1040ez efile free You can also send us comments from www. 1040ez efile free irs. 1040ez efile free gov/formspubs/, select “Comment on Tax Forms and Publications” under “Information About. 1040ez efile free ” Ordering forms and publications. 1040ez efile free   Visit www. 1040ez efile free irs. 1040ez efile free gov/formspubs/ to download forms and publications, call 1-800-829-3676, or write to the address below and receive a response within 10 days after your request is received. 1040ez efile free Internal Revenue Service 1201 N. 1040ez efile free Mitsubishi Motorway Bloomington, IL 61705-6613 Tax questions. 1040ez efile free   If you have a tax question, check the information available on IRS. 1040ez efile free gov or call 1-800-829-1040. 1040ez efile free We cannot answer tax questions sent to either of the above addresses. 1040ez efile free Useful Items - You may want to see: Publications 1 Your Rights as a Taxpayer 470 Limited Practice Without Enrollment Circular No. 1040ez efile free 230 Regulations Governing Practice before the Internal Revenue Service Forms and Instructions 2848 Power of Attorney and Declaration of Representative 8821 Tax Information Authorization Prev  Up  Next   Home   More Online Publications

.gov Reform Effort: Improving Federal Websites

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Digital Government Strategy

The White House released its Digital Government Strategy, entitled Digital Government: Building a 21st Century Platform to Better Serve the American People, on May 23, 2012. You can also download the Digital Government Strategy as a PDF.

The strategy is a plan for delivering better online service to the American people, with three main objectives:

  • Enable citizens and an increasingly mobile workforce to access high-quality digital government information and services anywhere, anytime, on any device.
  • Ensure that as the government adjusts to this new digital world, we seize the opportunity to procure and manage devices, applications, and data in smart, secure and affordable ways.
  • Unlock the power of government data to spur innovation across our Nation and improve the quality of services for the American people.

The Digital Government Strategy was created from a broad range of input across government: the Mobility Strategy and Web Reform Task Forces, the Office of Management and Budget, the General Services Administration, Federal CIOs, new media directors, and web managers. The Strategy also draws on research from the State of the Federal Web Report (PDF) and public input from the National Dialogue for Improving Federal Websites and the National Dialogue on the Federal Mobility Strategy.

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What is the .gov reform effort?

The .gov reform effort began in 2011 as part of President Obama's Campaign to Cut Waste, identifying unnecessary websites that can be consolidated into other websites to reduce costs and improve the quality of service to the American public.

The reform effort led to the development of a federal web strategy, which was merged with the federal mobility strategy to create the Digital Government Strategy. This broader initiative focuses not only on website consolidation, but also on innovating with less and delivering better quality content and information to the public across multiple platforms and devices.

What is the federal government doing to improve federal websites?

In the June 13, 2011, OMB Memorandum M-11-24, Implementing Executive Order 13571 on Streamlining Service Delivery and Improving Customer Service (PDF), agencies are directed to improve online services and eliminate wasteful spending. They must work to manage web resources more efficiently and assure that valuable content is readily accessible and available online. To date, the reform effort has:

  • Instituted a freeze on the approval of new .gov domain names and developed stronger criteria for getting a new domain.
  • Set up the .gov Reform Task Force to recommend updates to federal web guidelines and policies.
  • Posted and updated a list of all registered .gov domain names on Data.gov.
  • Asked agencies to identify sites that can be eliminated, consolidated, and/or streamlined.
  • Conducted an inventory of federal domains and sites, a survey of federal web governance policies and a national dialogue on improving federal web sites, and used the data to create the State of the Federal Web report.
  • Required agencies to develop Web Improvement Plans (included in the State of the Federal Web Report).
  • Worked with others across government to develop the Digital Government Strategy.

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Who's responsible for managing this effort?

The Office of Management and Budget (OMB), the General Services Administration (GSA), the Office of Science and Technology Policy (OSTP), the Chief Information Officers Council, and the Federal Web Managers Council are working with agencies to manage this effort. The .gov Task Force, whose members are listed below, is leading this effort.

Where can I see a list of federal websites?

The list of federal executive branch .gov domains was published July 12, 2011 on Data.gov. It does not include .gov domains/URLs in the federal legislative or judicial branches or from state, local, or tribal governments. It also does not include sub-domains that are below the root domain, such as ers.usda.gov or niaid.nih.gov.

Since each domain can have an unlimited number of potential websites and URLs under them, the total number of websites in the entire federal government is much larger than the number of domains listed on Data.gov. The inventory will allow us to more closely identify the total number of federal websites over time.

The list of domains will be regularly updated and published on Data.gov. Putting the list on Data.gov will have several benefits:

  • Provide increased access to, and transparency of, government data.
  • Foster accountability in how we manage our federal websites and encourage input from public and private sector experts, customers, developers, and other members of the public.
  • Make it easier for agencies to see the websites they own, that are owned by other agencies, and to increase opportunities for collaboration across government.

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Who is on the .gov Task Force and how were they selected?

The Federal Chief Information Officer selected the members of the .gov Task Force, representing a broad range of agencies and a mix of perspectives and skills.

Task force members:

  • Les Benito, Director, Public Web at Defense Media Activity
  • Gray Brooks, Associate CIO, Federal Communications Commission
  • Sheila Campbell, Director, Center for Excellence in Digital Government, Office of Citizen Services, General Services Administration
  • Sarah Crane, Director, USA.gov, Office of Citizen Services, General Services Administration
  • Cammie Croft, Senior Advisor, Director of New Media and Citizen Engagement, Department of Energy
  • Linda Cureton, Chief Information Officer, NASA
  • Terry Davis, IT Specialist, Department of Defense
  • Nick Fraser, Office of Information and Regulatory Affairs, Office of Management and Budget, Executive Office of the President
  • Miguel Gomez, Director, AIDS.gov, Health and Human Services
  • Jeffrey Levy, Director of Web Communications, Environmental Protection Agency, and Co-Chair, Federal Web Managers Council
  • Dan Munz, IT Specialist, Consumer Financial Protection Bureau
  • Adam Neufeld, Office of Management and Budget, Executive Office of the President
  • Todd Park, U.S. Chief Technology Officer
  • Macon Phillips, Director of Digital Strategy, The White House
  • Stacy Riggs, Office of Government-wide Policy, General Services Administration
  • Rand Ruggieri, EGov Program Manager, Department of Commerce
  • Janet Stevens, Chief Information Officer, Food Safety and Inspection Service, Department of Agriculture
  • Kodiak Starr, Creative Director of New Media, Executive Office of the President
  • Haley Van Dyck, Office of E-Gov and Information Technology, Office of Management and Budget, Executive Office of the President
  • Chris Vein, Deputy U.S. Chief Technology Officer for Government Innovation, Office of Science and Technology Policy, Executive Office of the President
  • Jim Wilson, Senior Editor, NASA.gov

We plan to consult with additional subject matter experts, customers, and others as needed, to provide expertise on such areas as user-centered design, search, information management policy, privacy and security issues, and overall Internet trends such as the growth of mobile and social media.

How was the public involved in improving federal websites?

During this initiative we've invited you to join the conversation about improving federal websites. Releasing the .gov dataset on Data.gov was the first step. We enabled commenting on the dataset, and considered your ideas and comments as we developed the domain inventory.

As we've seen in other efforts, making government data transparent can spark the creativity of many bright minds across the country. We hope the public will continue to explore, discuss, and remix this data, and maybe even use it to map the .gov domain in ways we haven't seen before.

From September 19–30, 2011, we hosted a "national dialogue"–an online conversation that brought together experts, innovators, and ordinary citizens who rely on federal information every day. We discussed how federal agencies can learn from, and contribute to, the best practices of the modern web. It was a discussion filled with ideas and energy.

If you have questions about the .gov Task Force, contact Alycia Piazza at alycia.piazza@gsa.gov.

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Content Lead: Natalie Davidson and Andrea Sigritz
Page Reviewed/Updated: October 22, 2013

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1040ez efile free 22. 1040ez efile free   Taxes Table of Contents IntroductionIndian tribal government. 1040ez efile free Useful Items - You may want to see: Tests To Deduct Any Tax Income TaxesState and Local Income Taxes Foreign Income Taxes General Sales TaxesMotor vehicles. 1040ez efile free Real Estate TaxesReal estate taxes for prior years. 1040ez efile free Examples. 1040ez efile free Form 1099-S. 1040ez efile free Real Estate-Related Items You Cannot Deduct Personal Property Taxes Taxes and Fees You Cannot Deduct Where To Deduct Introduction This chapter discusses which taxes you can deduct if you itemize deductions on Schedule A (Form 1040). 1040ez efile free It also explains which taxes you can deduct on other schedules or forms and which taxes you cannot deduct. 1040ez efile free This chapter covers the following topics. 1040ez efile free Income taxes (federal, state, local, and foreign). 1040ez efile free General sales taxes (state and local). 1040ez efile free Real estate taxes (state, local, and foreign). 1040ez efile free Personal property taxes (state and local). 1040ez efile free Taxes and fees you cannot deduct. 1040ez efile free Use Table 22-1 as a guide to determine which taxes you can deduct. 1040ez efile free The end of the chapter contains a section that explains which forms you use to deduct different types of taxes. 1040ez efile free Business taxes. 1040ez efile free   You can deduct certain taxes only if they are ordinary and necessary expenses of your trade or business or of producing income. 1040ez efile free For information on these taxes, see Publication 535, Business Expenses. 1040ez efile free State or local taxes. 1040ez efile free   These are taxes imposed by the 50 states, U. 1040ez efile free S. 1040ez efile free possessions, or any of their political subdivisions (such as a county or city), or by the District of Columbia. 1040ez efile free Indian tribal government. 1040ez efile free   An Indian tribal government recognized by the Secretary of the Treasury as performing substantial government functions will be treated as a state for purposes of claiming a deduction for taxes. 1040ez efile free Income taxes, real estate taxes, and personal property taxes imposed by that Indian tribal government (or by any of its subdivisions that are treated as political subdivisions of a state) are deductible. 1040ez efile free General sales taxes. 1040ez efile free   These are taxes imposed at one rate on retail sales of a broad range of classes of items. 1040ez efile free Foreign taxes. 1040ez efile free   These are taxes imposed by a foreign country or any of its political subdivisions. 1040ez efile free Useful Items - You may want to see: Publication 514 Foreign Tax Credit for Individuals 530 Tax Information for Homeowners Form (and Instructions) Schedule A (Form 1040) Itemized Deductions Schedule E (Form 1040) Supplemental Income and Loss 1116 Foreign Tax Credit Tests To Deduct Any Tax The following two tests must be met for you to deduct any tax. 1040ez efile free The tax must be imposed on you. 1040ez efile free You must pay the tax during your tax year. 1040ez efile free The tax must be imposed on you. 1040ez efile free   In general, you can deduct only taxes imposed on you. 1040ez efile free   Generally, you can deduct property taxes only if you are an owner of the property. 1040ez efile free If your spouse owns the property and pays the real estate taxes, the taxes are deductible on your spouse's separate return or on your joint return. 1040ez efile free You must pay the tax during your tax year. 1040ez efile free   If you are a cash basis taxpayer, you can deduct only those taxes you actually paid during your tax year. 1040ez efile free If you pay your taxes by check, the day you mail or deliver the check is the date of payment, provided the check is honored by the financial institution. 1040ez efile free If you use a pay-by-phone account (such as a credit card or electronic funds withdrawal), the date reported on the statement of the financial institution showing when payment was made is the date of payment. 1040ez efile free If you contest a tax liability and are a cash basis taxpayer, you can deduct the tax only in the year you actually pay it (or transfer money or other property to provide for satisfaction of the contested liability). 1040ez efile free See Publication 538, Accounting Periods and Methods, for details. 1040ez efile free    If you use an accrual method of accounting, see Publication 538 for more information. 1040ez efile free Income Taxes This section discusses the deductibility of state and local income taxes (including employee contributions to state benefit funds) and foreign income taxes. 1040ez efile free State and Local Income Taxes You can deduct state and local income taxes. 1040ez efile free However, you can elect to deduct state and local general sales taxes instead of state and local income taxes. 1040ez efile free See General Sales Taxes , later. 1040ez efile free Exception. 1040ez efile free    You cannot deduct state and local income taxes you pay on income that is exempt from federal income tax, unless the exempt income is interest income. 1040ez efile free For example, you cannot deduct the part of a state's income tax that is on a cost-of-living allowance exempt from federal income tax. 1040ez efile free What To Deduct Your deduction may be for withheld taxes, estimated tax payments, or other tax payments as follows. 1040ez efile free Withheld taxes. 1040ez efile free   You can deduct state and local income taxes withheld from your salary in the year they are withheld. 1040ez efile free Your Form(s) W-2 will show these amounts. 1040ez efile free Forms W-2G, 1099-G, 1099-R, and 1099-MISC may also show state and local income taxes withheld. 1040ez efile free Estimated tax payments. 1040ez efile free   You can deduct estimated tax payments you made during the year to a state or local government. 1040ez efile free However, you must have a reasonable basis for making the estimated tax payments. 1040ez efile free Any estimated state or local tax payments that are not made in good faith at the time of payment are not deductible. 1040ez efile free For example, you made an estimated state income tax payment. 1040ez efile free However, the estimate of your state tax liability shows that you will get a refund of the full amount of your estimated payment. 1040ez efile free You had no reasonable basis to believe you had any additional liability for state income taxes and you cannot deduct the estimated tax payment. 1040ez efile free Refund applied to taxes. 1040ez efile free   You can deduct any part of a refund of prior-year state or local income taxes that you chose to have credited to your 2013 estimated state or local income taxes. 1040ez efile free    Do not reduce your deduction by either of the following items. 1040ez efile free Any state or local income tax refund (or credit) you expect to receive for 2013. 1040ez efile free Any refund of (or credit for) prior-year state and local income taxes you actually received in 2013. 1040ez efile free   However, part or all of this refund (or credit) may be taxable. 1040ez efile free See Refund (or credit) of state or local income taxes , later. 1040ez efile free Separate federal returns. 1040ez efile free   If you and your spouse file separate state, local, and federal income tax returns, you each can deduct on your federal return only the amount of your own state and local income tax that you paid during the tax year. 1040ez efile free Joint state and local returns. 1040ez efile free   If you and your spouse file joint state and local returns and separate federal returns, each of you can deduct on your separate federal return a part of the total state and local income taxes paid during the tax year. 1040ez efile free You can deduct only the amount of the total taxes that is proportionate to your gross income compared to the combined gross income of you and your spouse. 1040ez efile free However, you cannot deduct more than the amount you actually paid during the year. 1040ez efile free You can avoid this calculation if you and your spouse are jointly and individually liable for the full amount of the state and local income taxes. 1040ez efile free If so, you and your spouse can deduct on your separate federal returns the amount you each actually paid. 1040ez efile free Joint federal return. 1040ez efile free   If you file a joint federal return, you can deduct the total of the state and local income taxes both of you paid. 1040ez efile free Contributions to state benefit funds. 1040ez efile free    As an employee, you can deduct mandatory contributions to state benefit funds withheld from your wages that provide protection against loss of wages. 1040ez efile free For example, certain states require employees to make contributions to state funds providing disability or unemployment insurance benefits. 1040ez efile free Mandatory payments made to the following state benefit funds are deductible as state income taxes on Schedule A (Form 1040), line 5. 1040ez efile free Alaska Unemployment Compensation Fund. 1040ez efile free California Nonoccupational Disability Benefit Fund. 1040ez efile free New Jersey Nonoccupational Disability Benefit Fund. 1040ez efile free New Jersey Unemployment Compensation Fund. 1040ez efile free New York Nonoccupational Disability Benefit Fund. 1040ez efile free Pennsylvania Unemployment Compensation Fund. 1040ez efile free Rhode Island Temporary Disability Benefit Fund. 1040ez efile free Washington State Supplemental Workmen's Compensation Fund. 1040ez efile free    Employee contributions to private or voluntary disability plans are not deductible. 1040ez efile free Refund (or credit) of state or local income taxes. 1040ez efile free   If you receive a refund of (or credit for) state or local income taxes in a year after the year in which you paid them, you may have to include the refund in income on Form 1040, line 10, in the year you receive it. 1040ez efile free This includes refunds resulting from taxes that were overwithheld, applied from a prior year return, not figured correctly, or figured again because of an amended return. 1040ez efile free If you did not itemize your deductions in the previous year, do not include the refund in income. 1040ez efile free If you deducted the taxes in the previous year, include all or part of the refund on Form 1040, line 10, in the year you receive the refund. 1040ez efile free For a discussion of how much to include, see Recoveries in chapter 12. 1040ez efile free Foreign Income Taxes Generally, you can take either a deduction or a credit for income taxes imposed on you by a foreign country or a U. 1040ez efile free S. 1040ez efile free possession. 1040ez efile free However, you cannot take a deduction or credit for foreign income taxes paid on income that is exempt from U. 1040ez efile free S. 1040ez efile free tax under the foreign earned income exclusion or the foreign housing exclusion. 1040ez efile free For information on these exclusions, see Publication 54, Tax Guide for U. 1040ez efile free S. 1040ez efile free Citizens and Resident Aliens Abroad. 1040ez efile free For information on the foreign tax credit, see Publication 514. 1040ez efile free General Sales Taxes You can elect to deduct state and local general sales taxes, instead of state and local income taxes, as an itemized deduction on Schedule A (Form 1040), line 5b. 1040ez efile free You can use either your actual expenses or the state and local sales tax tables to figure your sales tax deduction. 1040ez efile free Actual expenses. 1040ez efile free   Generally, you can deduct the actual state and local general sales taxes (including compensating use taxes) if the tax rate was the same as the general sales tax rate. 1040ez efile free However, sales taxes on food, clothing, medical supplies, and motor vehicles are deductible as a general sales tax even if the tax rate was less than the general sales tax rate. 1040ez efile free If you paid sales tax on a motor vehicle at a rate higher than the general sales tax rate, you can deduct only the amount of tax that you would have paid at the general sales tax rate on that vehicle. 1040ez efile free If you use the actual expenses method, you must have receipts to show the general sales taxes paid. 1040ez efile free Do not include sales taxes paid on items used in your trade or business. 1040ez efile free Motor vehicles. 1040ez efile free   For purposes of this section, motor vehicles include cars, motorcycles, motor homes, recreational vehicles, sport utility vehicles, trucks, vans, and off-road vehicles. 1040ez efile free This also includes sales taxes on a leased motor vehicle, but not on vehicles used in your trade or business. 1040ez efile free Optional sales tax tables. 1040ez efile free   Instead of using your actual expenses, you can figure your state and local general sales tax deduction using the state and local sales tax tables in the Instructions for Schedule A (Form 1040). 1040ez efile free You may also be able to add the state and local general sales taxes paid on certain specified items. 1040ez efile free   Your applicable table amount is based on the state where you live, your income, and the number of exemptions claimed on your tax return. 1040ez efile free Your income is your adjusted gross income plus any nontaxable items such as the following. 1040ez efile free Tax-exempt interest. 1040ez efile free Veterans' benefits. 1040ez efile free Nontaxable combat pay. 1040ez efile free Workers' compensation. 1040ez efile free Nontaxable part of social security and railroad retirement benefits. 1040ez efile free Nontaxable part of IRA, pension, or annuity distributions, excluding rollovers. 1040ez efile free Public assistance payments. 1040ez efile free If you lived in different states during the same tax year, you must prorate your applicable table amount for each state based on the days you lived in each state. 1040ez efile free See the Instructions for Schedule A (Form 1040), line 5, for details. 1040ez efile free Real Estate Taxes Deductible real estate taxes are any state, local, or foreign taxes on real property levied for the general public welfare. 1040ez efile free You can deduct these taxes only if they are based on the assessed value of the real property and charged uniformly against all property under the jurisdiction of the taxing authority. 1040ez efile free Deductible real estate taxes generally do not include taxes charged for local benefits and improvements that increase the value of the property. 1040ez efile free They also do not include itemized charges for services (such as trash collection) assessed against specific property or certain people, even if the charge is paid to the taxing authority. 1040ez efile free For more information about taxes and charges that are not deductible, see Real Estate-Related Items You Cannot Deduct , later. 1040ez efile free Tenant-shareholders in a cooperative housing corporation. 1040ez efile free   Generally, if you are a tenant-stockholder in a cooperative housing corporation, you can deduct the amount paid to the corporation that represents your share of the real estate taxes the corporation paid or incurred for your dwelling unit. 1040ez efile free The corporation should provide you with a statement showing your share of the taxes. 1040ez efile free For more information, see Special Rules for Cooperatives in Publication 530. 1040ez efile free Division of real estate taxes between buyers and sellers. 1040ez efile free   If you bought or sold real estate during the year, the real estate taxes must be divided between the buyer and the seller. 1040ez efile free   The buyer and the seller must divide the real estate taxes according to the number of days in the real property tax year (the period to which the tax is imposed relates) that each owned the property. 1040ez efile free The seller is treated as paying the taxes up to, but not including, the date of sale. 1040ez efile free The buyer is treated as paying the taxes beginning with the date of sale. 1040ez efile free This applies regardless of the lien dates under local law. 1040ez efile free Generally, this information is included on the settlement statement provided at the closing. 1040ez efile free    If you (the seller) cannot deduct taxes until they are paid because you use the cash method of accounting, and the buyer of your property is personally liable for the tax, you are considered to have paid your part of the tax at the time of the sale. 1040ez efile free This lets you deduct the part of the tax to the date of sale even though you did not actually pay it. 1040ez efile free However, you must also include the amount of that tax in the selling price of the property. 1040ez efile free The buyer must include the same amount in his or her cost of the property. 1040ez efile free   You figure your deduction for taxes on each property bought or sold during the real property tax year as follows. 1040ez efile free Worksheet 22-1. 1040ez efile free Figuring Your Real Estate Tax Deduction 1. 1040ez efile free Enter the total real estate taxes for the real property tax year   2. 1040ez efile free Enter the number of days in the real property tax year that you owned the property   3. 1040ez efile free Divide line 2 by 365 (for leap years, divide line 2 by 366) . 1040ez efile free 4. 1040ez efile free Multiply line 1 by line 3. 1040ez efile free This is your deduction. 1040ez efile free Enter it on Schedule A (Form 1040), line 6   Note. 1040ez efile free Repeat steps 1 through 4 for each property you bought or sold during the real property tax year. 1040ez efile free Your total deduction is the sum of the line 4 amounts for all of the properties. 1040ez efile free Real estate taxes for prior years. 1040ez efile free   Do not divide delinquent taxes between the buyer and seller if the taxes are for any real property tax year before the one in which the property is sold. 1040ez efile free Even if the buyer agrees to pay the delinquent taxes, the buyer cannot deduct them. 1040ez efile free The buyer must add them to the cost of the property. 1040ez efile free The seller can deduct these taxes paid by the buyer. 1040ez efile free However, the seller must include them in the selling price. 1040ez efile free Examples. 1040ez efile free   The following examples illustrate how real estate taxes are divided between buyer and seller. 1040ez efile free Example 1. 1040ez efile free Dennis and Beth White's real property tax year for both their old home and their new home is the calendar year, with payment due August 1. 1040ez efile free The tax on their old home, sold on May 7, was $620. 1040ez efile free The tax on their new home, bought on May 3, was $732. 1040ez efile free Dennis and Beth are considered to have paid a proportionate share of the real estate taxes on the old home even though they did not actually pay them to the taxing authority. 1040ez efile free On the other hand, they can claim only a proportionate share of the taxes they paid on their new property even though they paid the entire amount. 1040ez efile free Dennis and Beth owned their old home during the real property tax year for 126 days (January 1 to May 6, the day before the sale). 1040ez efile free They figure their deduction for taxes on their old home as follows. 1040ez efile free Worksheet 22-1. 1040ez efile free Figuring Your Real Estate Tax Deduction — Taxes on Old Home 1. 1040ez efile free Enter the total real estate taxes for the real property tax year $620 2. 1040ez efile free Enter the number of days in the real property tax year that you owned the property 126 3. 1040ez efile free Divide line 2 by 365 (for leap years, divide line 2 by 366) . 1040ez efile free 3452 4. 1040ez efile free Multiply line 1 by line 3. 1040ez efile free This is your deduction. 1040ez efile free Enter it on Schedule A (Form 1040), line 6 $214 Since the buyers of their old home paid all of the taxes, Dennis and Beth also include the $214 in the selling price of the old home. 1040ez efile free (The buyers add the $214 to their cost of the home. 1040ez efile free ) Dennis and Beth owned their new home during the real property tax year for 243 days (May 3 to December 31, including their date of purchase). 1040ez efile free They figure their deduction for taxes on their new home as follows. 1040ez efile free Worksheet 22-1. 1040ez efile free Figuring Your Real Estate Tax Deduction — Taxes on New Home 1. 1040ez efile free Enter the total real estate taxes for the real property tax year $732 2. 1040ez efile free Enter the number of days in the real property tax year that you owned the property 243 3. 1040ez efile free Divide line 2 by 365 (for leap years, divide line 2 by 366) . 1040ez efile free 6658 4. 1040ez efile free Multiply line 1 by line 3. 1040ez efile free This is your deduction. 1040ez efile free Enter it on Schedule A (Form 1040), line 6 $487 Since Dennis and Beth paid all of the taxes on the new home, they add $245 ($732 paid less $487 deduction) to their cost of the new home. 1040ez efile free (The sellers add this $245 to their selling price and deduct the $245 as a real estate tax. 1040ez efile free ) Dennis and Beth's real estate tax deduction for their old and new homes is the sum of $214 and $487, or $701. 1040ez efile free They will enter this amount on Schedule A (Form 1040), line 6. 1040ez efile free Example 2. 1040ez efile free George and Helen Brown bought a new home on May 3, 2013. 1040ez efile free Their real property tax year for the new home is the calendar year. 1040ez efile free Real estate taxes for 2012 were assessed in their state on January 1, 2013. 1040ez efile free The taxes became due on May 31, 2013, and October 31, 2013. 1040ez efile free The Browns agreed to pay all taxes due after the date of purchase. 1040ez efile free Real estate taxes for 2012 were $680. 1040ez efile free They paid $340 on May 31, 2013, and $340 on October 31, 2013. 1040ez efile free These taxes were for the 2012 real property tax year. 1040ez efile free The Browns cannot deduct them since they did not own the property until 2013. 1040ez efile free Instead, they must add $680 to the cost of their new home. 1040ez efile free In January 2014, the Browns receive their 2013 property tax statement for $752, which they will pay in 2014. 1040ez efile free The Browns owned their new home during the 2013 real property tax year for 243 days (May 3 to December 31). 1040ez efile free They will figure their 2014 deduction for taxes as follows. 1040ez efile free Worksheet 22-1. 1040ez efile free Figuring Your Real Estate Tax Deduction — Taxes on New Home 1. 1040ez efile free Enter the total real estate taxes for the real property tax year $752 2. 1040ez efile free Enter the number of days in the real property tax year that you owned the property 243 3. 1040ez efile free Divide line 2 by 365 (for leap years, divide line 2 by 366) . 1040ez efile free 6658 4. 1040ez efile free Multiply line 1 by line 3. 1040ez efile free This is your deduction. 1040ez efile free Claim it on Schedule A (Form 1040), line 6 $501 The remaining $251 ($752 paid less $501 deduction) of taxes paid in 2014, along with the $680 paid in 2013, is added to the cost of their new home. 1040ez efile free Because the taxes up to the date of sale are considered paid by the seller on the date of sale, the seller is entitled to a 2013 tax deduction of $931. 1040ez efile free This is the sum of the $680 for 2012 and the $251 for the 122 days the seller owned the home in 2013. 1040ez efile free The seller must also include the $931 in the selling price when he or she figures the gain or loss on the sale. 1040ez efile free The seller should contact the Browns in January 2014 to find out how much real estate tax is due for 2013. 1040ez efile free Form 1099-S. 1040ez efile free   For certain sales or exchanges of real estate, the person responsible for closing the sale (generally the settlement agent) prepares Form 1099-S, Proceeds From Real Estate Transactions, to report certain information to the IRS and to the seller of the property. 1040ez efile free Box 2 of Form 1099-S is for the gross proceeds from the sale and should include the portion of the seller's real estate tax liability that the buyer will pay after the date of sale. 1040ez efile free The buyer includes these taxes in the cost basis of the property, and the seller both deducts this amount as a tax paid and includes it in the sales price of the property. 1040ez efile free   For a real estate transaction that involves a home, any real estate tax the seller paid in advance but that is the liability of the buyer appears on Form 1099-S, box 5. 1040ez efile free The buyer deducts this amount as a real estate tax, and the seller reduces his or her real estate tax deduction (or includes it in income) by the same amount. 1040ez efile free See Refund (or rebate) , later. 1040ez efile free Taxes placed in escrow. 1040ez efile free   If your monthly mortgage payment includes an amount placed in escrow (put in the care of a third party) for real estate taxes, you may not be able to deduct the total amount placed in escrow. 1040ez efile free You can deduct only the real estate tax that the third party actually paid to the taxing authority. 1040ez efile free If the third party does not notify you of the amount of real estate tax that was paid for you, contact the third party or the taxing authority to find the proper amount to show on your return. 1040ez efile free Tenants by the entirety. 1040ez efile free   If you and your spouse held property as tenants by the entirety and you file separate federal returns, each of you can deduct only the taxes each of you paid on the property. 1040ez efile free Divorced individuals. 1040ez efile free   If your divorce or separation agreement states that you must pay the real estate taxes for a home owned by you and your spouse, part of your payments may be deductible as alimony and part as real estate taxes. 1040ez efile free See Taxes and insurance in chapter 18 for more information. 1040ez efile free Ministers' and military housing allowances. 1040ez efile free   If you are a minister or a member of the uniformed services and receive a housing allowance that you can exclude from income, you still can deduct all of the real estate taxes you pay on your home. 1040ez efile free Refund (or rebate). 1040ez efile free   If you received a refund or rebate in 2013 of real estate taxes you paid in 2013, you must reduce your deduction by the amount refunded to you. 1040ez efile free If you received a refund or rebate in 2013 of real estate taxes you deducted in an earlier year (either as an itemized deduction or an increase to your standard deduction), you generally must include the refund or rebate in income in the year you receive it. 1040ez efile free However, the amount you include in income is limited to the amount of the deduction that reduced your tax in the earlier year. 1040ez efile free For more information, see Recoveries in chapter 12. 1040ez efile free Table 22-1. 1040ez efile free Which Taxes Can You Deduct? Type of Tax You Can Deduct You Cannot Deduct Fees and Charges Fees and charges that are expenses of your trade or business or of producing income. 1040ez efile free Fees and charges that are not expenses of your trade or business or of producing income, such as fees for driver's licenses, car inspections, parking, or charges for water bills (see Taxes and Fees You Cannot Deduct ). 1040ez efile free     Fines and penalties. 1040ez efile free Income Taxes State and local income taxes. 1040ez efile free Federal income taxes. 1040ez efile free   Foreign income taxes. 1040ez efile free     Employee contributions to state funds listed under Contributions to state benefit funds . 1040ez efile free Employee contributions to private or voluntary disability plans. 1040ez efile free     State and local general sales taxes if you choose to deduct state and local income taxes. 1040ez efile free General Sales Taxes State and local general sales taxes, including compensating use taxes. 1040ez efile free State and local income taxes if you choose to deduct state and local general sales taxes. 1040ez efile free Other Taxes Taxes that are expenses of your trade or business. 1040ez efile free Federal excise taxes, such as tax on gasoline, that are not expenses of your trade or business or of producing income. 1040ez efile free   Taxes on property producing rent or royalty income. 1040ez efile free Per capita taxes. 1040ez efile free   Occupational taxes. 1040ez efile free See chapter 28. 1040ez efile free     One-half of self-employment tax paid. 1040ez efile free   Personal Property Taxes State and local personal property taxes. 1040ez efile free Customs duties that are not expenses of your trade or business or of producing income. 1040ez efile free Real Estate Taxes State and local real estate taxes. 1040ez efile free Real estate taxes that are treated as imposed on someone else (see Division of real estate taxes between buyers and sellers ). 1040ez efile free   Foreign real estate taxes. 1040ez efile free Taxes for local benefits (with exceptions). 1040ez efile free See Real Estate-Related Items You Cannot Deduct . 1040ez efile free   Tenant's share of real estate taxes paid by  cooperative housing corporation. 1040ez efile free Trash and garbage pickup fees (with exceptions). 1040ez efile free See Real Estate-Related Items You Cannot Deduct . 1040ez efile free     Rent increase due to higher real estate taxes. 1040ez efile free     Homeowners' association charges. 1040ez efile free Real Estate-Related Items You Cannot Deduct Payments for the following items generally are not deductible as real estate taxes. 1040ez efile free Taxes for local benefits. 1040ez efile free Itemized charges for services (such as trash and garbage pickup fees). 1040ez efile free Transfer taxes (or stamp taxes). 1040ez efile free Rent increases due to higher real estate taxes. 1040ez efile free Homeowners' association charges. 1040ez efile free Taxes for local benefits. 1040ez efile free   Deductible real estate taxes generally do not include taxes charged for local benefits and improvements tending to increase the value of your property. 1040ez efile free These include assessments for streets, sidewalks, water mains, sewer lines, public parking facilities, and similar improvements. 1040ez efile free You should increase the basis of your property by the amount of the assessment. 1040ez efile free   Local benefit taxes are deductible only if they are for maintenance, repair, or interest charges related to those benefits. 1040ez efile free If only a part of the taxes is for maintenance, repair, or interest, you must be able to show the amount of that part to claim the deduction. 1040ez efile free If you cannot determine what part of the tax is for maintenance, repair, or interest, none of it is deductible. 1040ez efile free    Taxes for local benefits may be included in your real estate tax bill. 1040ez efile free If your taxing authority (or mortgage lender) does not furnish you a copy of your real estate tax bill, ask for it. 1040ez efile free You should use the rules above to determine if the local benefit tax is deductible. 1040ez efile free Contact the taxing authority if you need additional information about a specific charge on your real estate tax bill. 1040ez efile free Itemized charges for services. 1040ez efile free    An itemized charge for services assessed against specific property or certain people is not a tax, even if the charge is paid to the taxing authority. 1040ez efile free For example, you cannot deduct the charge as a real estate tax if it is: A unit fee for the delivery of a service (such as a $5 fee charged for every 1,000 gallons of water you use), A periodic charge for a residential service (such as a $20 per month or $240 annual fee charged to each homeowner for trash collection), or A flat fee charged for a single service provided by your government (such as a $30 charge for mowing your lawn because it was allowed to grow higher than permitted under your local ordinance). 1040ez efile free    You must look at your real estate tax bill to determine if any nondeductible itemized charges, such as those listed above, are included in the bill. 1040ez efile free If your taxing authority (or mortgage lender) does not furnish you a copy of your real estate tax bill, ask for it. 1040ez efile free Exception. 1040ez efile free   Service charges used to maintain or improve services (such as trash collection or police and fire protection) are deductible as real estate taxes if: The fees or charges are imposed at a like rate against all property in the taxing jurisdiction, The funds collected are not earmarked; instead, they are commingled with general revenue funds, and Funds used to maintain or improve services are not limited to or determined by the amount of these fees or charges collected. 1040ez efile free Transfer taxes (or stamp taxes). 1040ez efile free   Transfer taxes and similar taxes and charges on the sale of a personal home are not deductible. 1040ez efile free If they are paid by the seller, they are expenses of the sale and reduce the amount realized on the sale. 1040ez efile free If paid by the buyer, they are included in the cost basis of the property. 1040ez efile free Rent increase due to higher real estate taxes. 1040ez efile free   If your landlord increases your rent in the form of a tax surcharge because of increased real estate taxes, you cannot deduct the increase as taxes. 1040ez efile free Homeowners' association charges. 1040ez efile free   These charges are not deductible because they are imposed by the homeowners' association, rather than the state or local government. 1040ez efile free Personal Property Taxes Personal property tax is deductible if it is a state or local tax that is: Charged on personal property, Based only on the value of the personal property, and Charged on a yearly basis, even if it is collected more or less than once a year. 1040ez efile free A tax that meets the above requirements can be considered charged on personal property even if it is for the exercise of a privilege. 1040ez efile free For example, a yearly tax based on value qualifies as a personal property tax even if it is called a registration fee and is for the privilege of registering motor vehicles or using them on the highways. 1040ez efile free If the tax is partly based on value and partly based on other criteria, it may qualify in part. 1040ez efile free Example. 1040ez efile free Your state charges a yearly motor vehicle registration tax of 1% of value plus 50 cents per hundredweight. 1040ez efile free You paid $32 based on the value ($1,500) and weight (3,400 lbs. 1040ez efile free ) of your car. 1040ez efile free You can deduct $15 (1% × $1,500) as a personal property tax because it is based on the value. 1040ez efile free The remaining $17 ($. 1040ez efile free 50 × 34), based on the weight, is not deductible. 1040ez efile free Taxes and Fees You Cannot Deduct Many federal, state, and local government taxes are not deductible because they do not fall within the categories discussed earlier. 1040ez efile free Other taxes and fees, such as federal income taxes, are not deductible because the tax law specifically prohibits a deduction for them. 1040ez efile free See Table 22-1. 1040ez efile free Taxes and fees that are generally not deductible include the following items. 1040ez efile free Employment taxes. 1040ez efile free This includes social security, Medicare, and railroad retirement taxes withheld from your pay. 1040ez efile free However, one-half of self-employment tax you pay is deductible. 1040ez efile free In addition, the social security and other employment taxes you pay on the wages of a household worker may be included in medical expenses that you can deduct or child care expenses that allow you to claim the child and dependent care credit. 1040ez efile free For more information, see chapters 21 and 32. 1040ez efile free Estate, inheritance, legacy, or succession taxes. 1040ez efile free However, you can deduct the estate tax attributable to income in respect of a decedent if you, as a beneficiary, must include that income in your gross income. 1040ez efile free In that case, deduct the estate tax as a miscellaneous deduction that is not subject to the 2%-of-adjusted-gross-income limit. 1040ez efile free For more information, see Publication 559, Survivors, Executors, and Administrators. 1040ez efile free Federal income taxes. 1040ez efile free This includes income taxes withheld from your pay. 1040ez efile free Fines and penalties. 1040ez efile free You cannot deduct fines and penalties paid to a government for violation of any law, including related amounts forfeited as collateral deposits. 1040ez efile free Gift taxes. 1040ez efile free License fees. 1040ez efile free You cannot deduct license fees for personal purposes (such as marriage, driver's, and dog license fees). 1040ez efile free Per capita taxes. 1040ez efile free You cannot deduct state or local per capita taxes. 1040ez efile free Many taxes and fees other than those listed above are also nondeductible, unless they are ordinary and necessary expenses of a business or income producing activity. 1040ez efile free For other nondeductible items, see Real Estate-Related Items You Cannot Deduct , earlier. 1040ez efile free Where To Deduct You deduct taxes on the following schedules. 1040ez efile free State and local income taxes. 1040ez efile free    These taxes are deducted on Schedule A (Form 1040), line 5, even if your only source of income is from business, rents, or royalties. 1040ez efile free Check box a on line 5. 1040ez efile free General sales taxes. 1040ez efile free   Sales taxes are deducted on Schedule A (Form 1040), line 5. 1040ez efile free You must check box b on line 5. 1040ez efile free If you elect to deduct sales taxes, you cannot deduct state and local income taxes on Schedule A (Form 1040), line 5, box a. 1040ez efile free Foreign income taxes. 1040ez efile free   Generally, income taxes you pay to a foreign country or U. 1040ez efile free S. 1040ez efile free possession can be claimed as an itemized deduction on Schedule A (Form 1040), line 8, or as a credit against your U. 1040ez efile free S. 1040ez efile free income tax on Form 1040, line 47. 1040ez efile free To claim the credit, you may have to complete and attach Form 1116. 1040ez efile free For more information, see chapter 37, the Form 1040 instructions, or Publication 514. 1040ez efile free Real estate taxes and personal property taxes. 1040ez efile free    Real estate and personal property taxes are deducted on Schedule A (Form 1040), lines 6 and 7, respectively, unless they are paid on property used in your business, in which case they are deducted on Schedule C, Schedule C-EZ, or Schedule F (Form 1040). 1040ez efile free Taxes on property that produces rent or royalty income are deducted on Schedule E (Form 1040). 1040ez efile free Self-employment tax. 1040ez efile free    Deduct one-half of your self-employment tax on Form 1040, line 27. 1040ez efile free Other taxes. 1040ez efile free    All other deductible taxes are deducted on Schedule A (Form 1040), line 8. 1040ez efile free Prev  Up  Next   Home   More Online Publications