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1040ez Instructions 2011

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1040ez Instructions 2011

1040ez instructions 2011 11. 1040ez instructions 2011   Patient-Centered Outcomes Research Fee Table of Contents The patient-centered outcomes research fee is imposed on issuers of specified health insurance policies (section 4375) and plan sponsors of applicable self-insured health plans (section 4376) for policy and plan years ending on or after October 1, 2012. 1040ez instructions 2011 Generally, references to taxes on Form 720 include this fee. 1040ez instructions 2011 Specified health insurance policies. 1040ez instructions 2011   For issuers of specified health insurance policies, the fee for a policy year ending before October 1, 2013, is $1. 1040ez instructions 2011 00, multiplied by the average number of lives covered under the policy for that policy year. 1040ez instructions 2011 Generally, issuers of specified health insurance polices must use one of the following four alternative methods to determine the average number of lives covered under a policy for the policy year. 1040ez instructions 2011 The actual count method. 1040ez instructions 2011 For policy years that end on or after October 1, 2012, issuers using the actual count method may begin counting lives covered under a policy as of May 14, 2012, rather than the first day of the policy year, and divide by the appropriate number of days remaining in the policy year. 1040ez instructions 2011 The snapshot method. 1040ez instructions 2011 For policy years that end on or after October 1, 2012, but that began before May 14, 2012, issuers using the snapshot method may use counts from quarters beginning on or after May 14, 2012, to determine the average number of lives covered under the policy. 1040ez instructions 2011 The member months method. 1040ez instructions 2011 And, 4. 1040ez instructions 2011 The state form method. 1040ez instructions 2011 The member months data and the data reported on state forms are based on the calendar year. 1040ez instructions 2011 To adjust for 2012, issuers will use a pro rata approach for calculating the average number of lives covered using the member months method or the state form method for 2012. 1040ez instructions 2011 For example, issuers using the member months number for 2012 will divide the member months number by 12 and multiply the resulting number by one quarter to arrive at the average number of lives covered for October through December 2012. 1040ez instructions 2011 Applicable self-insured health plans. 1040ez instructions 2011   For plan sponsors of applicable self-insured health plans, the fee for a plan year ending on or after October 1, 2012, and ending before October 1, 2013 is $1. 1040ez instructions 2011 00, multiplied by the average number of lives covered under the plan for that plan year. 1040ez instructions 2011 Generally, plan sponsors of applicable self-insured health plans must use one of the following three alternative methods to determine the average number of lives covered under a plan for the plan year. 1040ez instructions 2011 Actual count method. 1040ez instructions 2011 Snapshot method. 1040ez instructions 2011 Form 5500 method. 1040ez instructions 2011 However, for plan years beginning before July 11, 2012, and ending on or after October 1, 2012, plan sponsors may determine the average number of lives covered under the plan for the plan year using any reasonable method. 1040ez instructions 2011 Reporting and paying the fee. 1040ez instructions 2011   File Form 720 annually to report and pay the fee on the second quarter Form 720, no later than July 31 of the calendar year immediately following the last day of the policy year or plan year to which the fee applies. 1040ez instructions 2011 If you file Form 720 only to report the fee, do not file Form 720 for the 1st, 3rd, or 4th quarters of the year. 1040ez instructions 2011 If you file Form 720 to report quarterly excise tax liability for the 1st, 3rd, or 4th quarter of the year (for example, filers reporting the foreign insurance tax (IRS No. 1040ez instructions 2011 30)), do not make an entry on the line for IRS No. 1040ez instructions 2011 133 on those filings. 1040ez instructions 2011   Deposits are not required for this fee, so issuers and plan sponsors are not required to pay the fee using Electronic Federal Tax Payment System (EFTPS). 1040ez instructions 2011   However, if the fee is paid using EFTPS, the payment should be applied to the second quarter. 1040ez instructions 2011 See Electronic deposit requirement under How To Make Deposits in chapter 13, later. 1040ez instructions 2011 More information. 1040ez instructions 2011   For more information, including methods for calculating the average number of lives covered, see sections 4375, 4376, and 4377; also see T. 1040ez instructions 2011 D. 1040ez instructions 2011 9602, which is on page 746 of I. 1040ez instructions 2011 R. 1040ez instructions 2011 B. 1040ez instructions 2011 2012-52 at www. 1040ez instructions 2011 irs. 1040ez instructions 2011 gov/pub/irs-irbs/irb12-52. 1040ez instructions 2011 pdf. 1040ez instructions 2011 Prev  Up  Next   Home   More Online Publications
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The 1040ez Instructions 2011

1040ez instructions 2011 8. 1040ez instructions 2011   Business Expenses Table of Contents Introduction Useful Items - You may want to see: Bad DebtsAccrual method. 1040ez instructions 2011 Cash method. 1040ez instructions 2011 Car and Truck ExpensesOffice in the home. 1040ez instructions 2011 Methods for Deducting Car and Truck Expenses Reimbursing Your Employees for Expenses Depreciation Employees' PayFringe benefits. 1040ez instructions 2011 InsuranceHow to figure the deduction. 1040ez instructions 2011 Interest Legal and Professional FeesTax preparation fees. 1040ez instructions 2011 Pension Plans Rent Expense Taxes Travel, Meals, and EntertainmentTransportation. 1040ez instructions 2011 Taxi, commuter bus, and limousine. 1040ez instructions 2011 Baggage and shipping. 1040ez instructions 2011 Car or truck. 1040ez instructions 2011 Meals and lodging. 1040ez instructions 2011 Cleaning. 1040ez instructions 2011 Telephone. 1040ez instructions 2011 Tips. 1040ez instructions 2011 More information. 1040ez instructions 2011 Business Use of Your HomeExceptions to exclusive use. 1040ez instructions 2011 Other Expenses You Can Deduct Expenses You Cannot Deduct Introduction You can deduct the costs of operating your business. 1040ez instructions 2011 These costs are known as business expenses. 1040ez instructions 2011 These are costs you do not have to capitalize or include in the cost of goods sold but can deduct in the current year. 1040ez instructions 2011 To be deductible, a business expense must be both ordinary and necessary. 1040ez instructions 2011 An ordinary expense is one that is common and accepted in your field of business. 1040ez instructions 2011 A necessary expense is one that is helpful and appropriate for your business. 1040ez instructions 2011 An expense does not have to be indispensable to be considered necessary. 1040ez instructions 2011 For more information about the general rules for deducting business expenses, see chapter 1 in Publication 535, Business Expenses. 1040ez instructions 2011 If you have an expense that is partly for business and partly personal, separate the personal part from the business part. 1040ez instructions 2011 The personal part is not deductible. 1040ez instructions 2011 Useful Items - You may want to see: Publication 463 Travel, Entertainment, Gift, and Car Expenses 535 Business Expenses 946 How To Depreciate Property See chapter 12 for information about getting publications and forms. 1040ez instructions 2011 Bad Debts If someone owes you money you cannot collect, you have a bad debt. 1040ez instructions 2011 There are two kinds of bad debts, business bad debts and nonbusiness bad debts. 1040ez instructions 2011 A business bad debt is generally one that comes from operating your trade or business. 1040ez instructions 2011 You may be able to deduct business bad debts as an expense on your business tax return. 1040ez instructions 2011 Business bad debt. 1040ez instructions 2011   A business bad debt is a loss from the worthlessness of a debt that was either of the following. 1040ez instructions 2011 Created or acquired in your business. 1040ez instructions 2011 Closely related to your business when it became partly or totally worthless. 1040ez instructions 2011 A debt is closely related to your business if your primary motive for incurring the debt is a business reason. 1040ez instructions 2011   Business bad debts are mainly the result of credit sales to customers. 1040ez instructions 2011 They can also be the result of loans to suppliers, clients, employees, or distributors. 1040ez instructions 2011 Goods and services customers have not paid for are shown in your books as either accounts receivable or notes receivable. 1040ez instructions 2011 If you are unable to collect any part of these accounts or notes receivable, the uncollectible part is a business bad debt. 1040ez instructions 2011    You can take a bad debt deduction for these accounts and notes receivable only if the amount you were owed was included in your gross income either for the year the deduction is claimed or for a prior year. 1040ez instructions 2011 Accrual method. 1040ez instructions 2011   If you use an accrual method of accounting, you normally report income as you earn it. 1040ez instructions 2011 You can take a bad debt deduction for an uncollectible receivable if you have included the uncollectible amount in income. 1040ez instructions 2011 Cash method. 1040ez instructions 2011   If you use the cash method of accounting, you normally report income when you receive payment. 1040ez instructions 2011 You cannot take a bad debt deduction for amounts owed to you that you have not received and cannot collect if you never included those amounts in income. 1040ez instructions 2011 More information. 1040ez instructions 2011   For more information about business bad debts, see chapter 10 in Publication 535. 1040ez instructions 2011 Nonbusiness bad debts. 1040ez instructions 2011   All other bad debts are nonbusiness bad debts and are deductible as short-term capital losses on Form 8949 and Schedule D (Form 1040). 1040ez instructions 2011 For more information on nonbusiness bad debts, see Publication 550, Investment Income and Expenses. 1040ez instructions 2011 Car and Truck Expenses If you use your car or truck in your business, you may be able to deduct the costs of operating and maintaining your vehicle. 1040ez instructions 2011 You also may be able to deduct other costs of local transportation and traveling away from home overnight on business. 1040ez instructions 2011 You may qualify for a tax credit for qualified plug-in electric vehicles, qualified plug-in electric drive motor vehicles, and alternative motor vehicles you place in service during the year. 1040ez instructions 2011 See Form 8936 and Form 8910 for more information. 1040ez instructions 2011 Local transportation expenses. 1040ez instructions 2011   Local transportation expenses include the ordinary and necessary costs of all the following. 1040ez instructions 2011 Getting from one workplace to another in the course of your business or profession when you are traveling within the city or general area that is your tax home. 1040ez instructions 2011 Tax home is defined later. 1040ez instructions 2011 Visiting clients or customers. 1040ez instructions 2011 Going to a business meeting away from your regular workplace. 1040ez instructions 2011 Getting from your home to a temporary workplace when you have one or more regular places of work. 1040ez instructions 2011 These temporary workplaces can be either within the area of your tax home or outside that area. 1040ez instructions 2011 Local business transportation does not include expenses you have while traveling away from home overnight. 1040ez instructions 2011 Those expenses are deductible as travel expenses and are discussed later under Travel, Meals, and Entertainment. 1040ez instructions 2011 However, if you use your car while traveling away from home overnight, use the rules in this section to figure your car expense deduction. 1040ez instructions 2011   Generally, your tax home is your regular place of business, regardless of where you maintain your family home. 1040ez instructions 2011 It includes the entire city or general area in which your business or work is located. 1040ez instructions 2011 Example. 1040ez instructions 2011 You operate a printing business out of rented office space. 1040ez instructions 2011 You use your van to deliver completed jobs to your customers. 1040ez instructions 2011 You can deduct the cost of round-trip transportation between your customers and your print shop. 1040ez instructions 2011    You cannot deduct the costs of driving your car or truck between your home and your main or regular workplace. 1040ez instructions 2011 These costs are personal commuting expenses. 1040ez instructions 2011 Office in the home. 1040ez instructions 2011   Your workplace can be your home if you have an office in your home that qualifies as your principal place of business. 1040ez instructions 2011 For more information, see Business Use of Your Home, later. 1040ez instructions 2011 Example. 1040ez instructions 2011 You are a graphics designer. 1040ez instructions 2011 You operate your business out of your home. 1040ez instructions 2011 Your home qualifies as your principal place of business. 1040ez instructions 2011 You occasionally have to drive to your clients to deliver your completed work. 1040ez instructions 2011 You can deduct the cost of the round-trip transportation between your home and your clients. 1040ez instructions 2011 Methods for Deducting Car and Truck Expenses For local transportation or overnight travel by car or truck, you generally can use one of the following methods to figure your expenses. 1040ez instructions 2011 Standard mileage rate. 1040ez instructions 2011 Actual expenses. 1040ez instructions 2011 Standard mileage rate. 1040ez instructions 2011   You may be able to use the standard mileage rate to figure the deductible costs of operating your car, van, pickup, or panel truck for business purposes. 1040ez instructions 2011 For 2013, the standard mileage rate is 56. 1040ez instructions 2011 5 cents per mile. 1040ez instructions 2011    If you choose to use the standard mileage rate for a year, you cannot deduct your actual expenses for that year except for business-related parking fees and tolls. 1040ez instructions 2011 Choosing the standard mileage rate. 1040ez instructions 2011   If you want to use the standard mileage rate for a car or truck you own, you must choose to use it in the first year the car is available for use in your business. 1040ez instructions 2011 In later years, you can choose to use either the standard mileage rate or actual expenses. 1040ez instructions 2011   If you use the standard mileage rate for a car you lease, you must choose to use it for the entire lease period (including renewals). 1040ez instructions 2011 Standard mileage rate not allowed. 1040ez instructions 2011   You cannot use the standard mileage rate if you: Operate five or more cars at the same time, Claimed a depreciation deduction using any method other than straight line, for example, ACRS or MACRS, Claimed a section 179 deduction on the car, Claimed the special depreciation allowance on the car, Claimed actual car expenses for a car you leased, or Are a rural mail carrier who received a qualified reimbursement. 1040ez instructions 2011 Parking fees and tolls. 1040ez instructions 2011   In addition to using the standard mileage rate, you can deduct any business-related parking fees and tolls. 1040ez instructions 2011 (Parking fees you pay to park your car at your place of work are nondeductible commuting expenses. 1040ez instructions 2011 ) Actual expenses. 1040ez instructions 2011   If you do not choose to use the standard mileage rate, you may be able to deduct your actual car or truck expenses. 1040ez instructions 2011    If you qualify to use both methods, figure your deduction both ways to see which gives you a larger deduction. 1040ez instructions 2011   Actual car expenses include the costs of the following items. 1040ez instructions 2011 Depreciation Lease payments Registration Garage rent Licenses Repairs Gas Oil Tires Insurance Parking fees Tolls   If you use your vehicle for both business and personal purposes, you must divide your expenses between business and personal use. 1040ez instructions 2011 You can divide your expenses based on the miles driven for each purpose. 1040ez instructions 2011 Example. 1040ez instructions 2011 You are the sole proprietor of a flower shop. 1040ez instructions 2011 You drove your van 20,000 miles during the year. 1040ez instructions 2011 16,000 miles were for delivering flowers to customers and 4,000 miles were for personal use (including commuting miles). 1040ez instructions 2011 You can claim only 80% (16,000 ÷ 20,000) of the cost of operating your van as a business expense. 1040ez instructions 2011 More information. 1040ez instructions 2011   For more information about the rules for claiming car and truck expenses, see Publication 463. 1040ez instructions 2011 Reimbursing Your Employees for Expenses You generally can deduct the amount you reimburse your employees for car and truck expenses. 1040ez instructions 2011 The reimbursement you deduct and the manner in which you deduct it depend in part on whether you reimburse the expenses under an accountable plan or a nonaccountable plan. 1040ez instructions 2011 For details, see chapter 11 in Publication 535. 1040ez instructions 2011 That chapter explains accountable and nonaccountable plans and tells you whether to report the reimbursement on your employee's Form W-2, Wage and Tax Statement. 1040ez instructions 2011 Depreciation If property you acquire to use in your business is expected to last more than 1 year, you generally cannot deduct the entire cost as a business expense in the year you acquire it. 1040ez instructions 2011 You must spread the cost over more than 1 tax year and deduct part of it each year on Schedule C. 1040ez instructions 2011 This method of deducting the cost of business property is called depreciation. 1040ez instructions 2011 The discussion here is brief. 1040ez instructions 2011 You will find more information about depreciation in Publication 946. 1040ez instructions 2011 What property can be depreciated?   You can depreciate property if it meets all the following requirements. 1040ez instructions 2011 It must be property you own. 1040ez instructions 2011 It must be used in business or held to produce income. 1040ez instructions 2011 You never can depreciate inventory (explained in chapter 2) because it is not held for use in your business. 1040ez instructions 2011 It must have a useful life that extends substantially beyond the year it is placed in service. 1040ez instructions 2011 It must have a determinable useful life, which means that it must be something that wears out, decays, gets used up, becomes obsolete, or loses its value from natural causes. 1040ez instructions 2011 You never can depreciate the cost of land because land does not wear out, become obsolete, or get used up. 1040ez instructions 2011 It must not be excepted property. 1040ez instructions 2011 This includes property placed in service and disposed of in the same year. 1040ez instructions 2011 Repairs. 1040ez instructions 2011    You cannot depreciate repairs and replacements that do not increase the value of your property, make it more useful, or lengthen its useful life. 1040ez instructions 2011 You can deduct these amounts on line 21 of Schedule C or line 2 of Schedule C-EZ. 1040ez instructions 2011 Depreciation method. 1040ez instructions 2011   The method for depreciating most business and investment property placed in service after 1986 is called the Modified Accelerated Cost Recovery System (MACRS). 1040ez instructions 2011 MACRS is discussed in detail in Publication 946. 1040ez instructions 2011 Section 179 deduction. 1040ez instructions 2011   You can elect to deduct a limited amount of the cost of certain depreciable property in the year you place the property in service. 1040ez instructions 2011 This deduction is known as the “section 179 deduction. 1040ez instructions 2011 ” The maximum amount you can elect to deduct during 2013 is generally $500,000 (higher limits apply to certain property). 1040ez instructions 2011 See IRC 179(e). 1040ez instructions 2011   This limit is generally reduced by the amount by which the cost of the property placed in service during the tax year exceeds $2 million. 1040ez instructions 2011 The total amount of depreciation (including the section 179 deduction) you can take for a passenger automobile you use in your business and first place in service in 2013 is $3,160 ($11,160 if you take the special depreciation allowance for qualified passenger automobiles placed in service in 2013). 1040ez instructions 2011 Special rules apply to trucks and vans. 1040ez instructions 2011 For more information, see Publication 946. 1040ez instructions 2011 It explains what property qualifies for the deduction, what limits apply to the deduction, and when and how to recapture the deduction. 1040ez instructions 2011    Your section 179 election for the cost of any sport utility vehicle (SUV) and certain other vehicles is limited to $25,000. 1040ez instructions 2011 For more information, see the Instructions for Form 4562 or Publication 946. 1040ez instructions 2011 Listed property. 1040ez instructions 2011   You must follow special rules and recordkeeping requirements when depreciating listed property. 1040ez instructions 2011 Listed property is any of the following. 1040ez instructions 2011 Most passenger automobiles. 1040ez instructions 2011 Most other property used for transportation. 1040ez instructions 2011 Any property of a type generally used for entertainment, recreation, or amusement. 1040ez instructions 2011 Certain computers and related peripheral equipment. 1040ez instructions 2011   For more information about listed property, see Publication 946. 1040ez instructions 2011 Form 4562. 1040ez instructions 2011   Use Form 4562, Depreciation and Amortization, if you are claiming any of the following. 1040ez instructions 2011 Depreciation on property placed in service during the current tax year. 1040ez instructions 2011 A section 179 deduction. 1040ez instructions 2011 Depreciation on any listed property (regardless of when it was placed in service). 1040ez instructions 2011    If you have to use Form 4562, you must file Schedule C. 1040ez instructions 2011 You cannot use Schedule C-EZ. 1040ez instructions 2011   Employees' Pay You can generally deduct on Schedule C the pay you give your employees for the services they perform for your business. 1040ez instructions 2011 The pay may be in cash, property, or services. 1040ez instructions 2011 To be deductible, your employees' pay must be an ordinary and necessary expense and you must pay or incur it in the tax year. 1040ez instructions 2011 In addition, the pay must meet both the following tests. 1040ez instructions 2011 The pay must be reasonable. 1040ez instructions 2011 The pay must be for services performed. 1040ez instructions 2011 Chapter 2 in Publication 535 explains and defines these requirements. 1040ez instructions 2011 You cannot deduct your own salary or any personal withdrawals you make from your business. 1040ez instructions 2011 As a sole proprietor, you are not an employee of the business. 1040ez instructions 2011 If you had employees during the year, you must use Schedule C. 1040ez instructions 2011 You cannot use Schedule C-EZ. 1040ez instructions 2011 Kinds of pay. 1040ez instructions 2011   Some of the ways you may provide pay to your employees are listed below. 1040ez instructions 2011 For an explanation of each of these items, see chapter 2 in Publication 535. 1040ez instructions 2011 Awards. 1040ez instructions 2011 Bonuses. 1040ez instructions 2011 Education expenses. 1040ez instructions 2011 Fringe benefits (discussed later). 1040ez instructions 2011 Loans or advances you do not expect the employee to repay if they are for personal services actually performed. 1040ez instructions 2011 Property you transfer to an employee as payment for services. 1040ez instructions 2011 Reimbursements for employee business expenses. 1040ez instructions 2011 Sick pay. 1040ez instructions 2011 Vacation pay. 1040ez instructions 2011 Fringe benefits. 1040ez instructions 2011   A fringe benefit is a form of pay for the performance of services. 1040ez instructions 2011 The following are examples of fringe benefits. 1040ez instructions 2011 Benefits under qualified employee benefit programs. 1040ez instructions 2011 Meals and lodging. 1040ez instructions 2011 The use of a car. 1040ez instructions 2011 Flights on airplanes. 1040ez instructions 2011 Discounts on property or services. 1040ez instructions 2011 Memberships in country clubs or other social clubs. 1040ez instructions 2011 Tickets to entertainment or sporting events. 1040ez instructions 2011   Employee benefit programs include the following. 1040ez instructions 2011 Accident and health plans. 1040ez instructions 2011 Adoption assistance. 1040ez instructions 2011 Cafeteria plans. 1040ez instructions 2011 Dependent care assistance. 1040ez instructions 2011 Educational assistance. 1040ez instructions 2011 Group-term life insurance coverage. 1040ez instructions 2011 Welfare benefit funds. 1040ez instructions 2011   You can generally deduct the cost of fringe benefits you provide on your Schedule C in whatever category the cost falls. 1040ez instructions 2011 For example, if you allow an employee to use a car or other property you lease, deduct the cost of the lease as a rent or lease expense. 1040ez instructions 2011 If you own the property, include your deduction for its cost or other basis as a section 179 deduction or a depreciation deduction. 1040ez instructions 2011    You may be able to exclude all or part of the fringe benefits you provide from your employees' wages. 1040ez instructions 2011 For more information about fringe benefits and the exclusion of benefits, see Publication 15-B, Employer's Tax Guide to Fringe Benefits. 1040ez instructions 2011 Insurance You can generally deduct premiums you pay for the following kinds of insurance related to your business. 1040ez instructions 2011 Fire, theft, flood, or similar insurance. 1040ez instructions 2011 Credit insurance that covers losses from business bad debts. 1040ez instructions 2011 Group hospitalization and medical insurance for employees, including long-term care insurance. 1040ez instructions 2011 Liability insurance. 1040ez instructions 2011 Malpractice insurance that covers your personal liability for professional negligence resulting in injury or damage to patients or clients. 1040ez instructions 2011 Workers' compensation insurance set by state law that covers any claims for bodily injuries or job-related diseases suffered by employees in your business, regardless of fault. 1040ez instructions 2011 Contributions to a state unemployment insurance fund are deductible as taxes if they are considered taxes under state law. 1040ez instructions 2011 Overhead insurance that pays for business overhead expenses you have during long periods of disability caused by your injury or sickness. 1040ez instructions 2011 Car and other vehicle insurance that covers vehicles used in your business for liability, damages, and other losses. 1040ez instructions 2011 If you operate a vehicle partly for personal use, deduct only the part of the insurance premium that applies to the business use of the vehicle. 1040ez instructions 2011 If you use the standard mileage rate to figure your car expenses, you cannot deduct any car insurance premiums. 1040ez instructions 2011 Life insurance covering your employees if you are not directly or indirectly the beneficiary under the contract. 1040ez instructions 2011 Business interruption insurance that pays for lost profits if your business is shut down due to a fire or other cause. 1040ez instructions 2011 Nondeductible premiums. 1040ez instructions 2011   You cannot deduct premiums on the following kinds of insurance. 1040ez instructions 2011 Self-insurance reserve funds. 1040ez instructions 2011 You cannot deduct amounts credited to a reserve set up for self-insurance. 1040ez instructions 2011 This applies even if you cannot get business insurance coverage for certain business risks. 1040ez instructions 2011 However, your actual losses may be deductible. 1040ez instructions 2011 For more information, see Publication 547, Casualties, Disasters, and Thefts. 1040ez instructions 2011 Loss of earnings. 1040ez instructions 2011 You cannot deduct premiums for a policy that pays for your lost earnings due to sickness or disability. 1040ez instructions 2011 However, see item (8) in the previous list. 1040ez instructions 2011 Certain life insurance and annuities. 1040ez instructions 2011 For contracts issued before June 9, 1997, you cannot deduct the premiums on a life insurance policy covering you, an employee, or any person with a financial interest in your business if you are directly or indirectly a beneficiary of the policy. 1040ez instructions 2011 You are included among possible beneficiaries of the policy if the policy owner is obligated to repay a loan from you using the proceeds of the policy. 1040ez instructions 2011 A person has a financial interest in your business if the person is an owner or part owner of the business or has lent money to the business. 1040ez instructions 2011 For contracts issued after June 8, 1997, you generally cannot deduct the premiums on any life insurance policy, endowment contract, or annuity contract if you are directly or indirectly a beneficiary. 1040ez instructions 2011 The disallowance applies without regard to whom the policy covers. 1040ez instructions 2011 Insurance to secure a loan. 1040ez instructions 2011 If you take out a policy on your life or on the life of another person with a financial interest in your business to get or protect a business loan, you cannot deduct the premiums as a business expense. 1040ez instructions 2011 Nor can you deduct the premiums as interest on business loans or as an expense of financing loans. 1040ez instructions 2011 In the event of death, the proceeds of the policy are not taxed as income even if they are used to liquidate the debt. 1040ez instructions 2011 Self-employed health insurance deduction. 1040ez instructions 2011   You may be able to deduct the amount you paid for medical and dental insurance and qualified long-term care insurance for you and your family. 1040ez instructions 2011 How to figure the deduction. 1040ez instructions 2011   Generally, you can use the worksheet in the Form 1040 instructions to figure your deduction. 1040ez instructions 2011 However, if any of the following apply, you must use the worksheet in chapter 6 of Publication 535. 1040ez instructions 2011 You have more than one source of income subject to self-employment tax. 1040ez instructions 2011 You file Form 2555 or Form 2555-EZ (relating to foreign earned income). 1040ez instructions 2011 You are using amounts paid for qualified long-term care insurance to figure the deduction. 1040ez instructions 2011 Prepayment. 1040ez instructions 2011   You cannot deduct expenses in advance, even if you pay them in advance. 1040ez instructions 2011 This rule applies to any expense paid far enough in advance to, in effect, create an asset with a useful life extending substantially beyond the end of the current tax year. 1040ez instructions 2011 Example. 1040ez instructions 2011 In 2013, you signed a 3-year insurance contract. 1040ez instructions 2011 Even though you paid the premiums for 2013, 2014, and 2015 when you signed the contract, you can only deduct the premium for 2013 on your 2013 tax return. 1040ez instructions 2011 You can deduct in 2014 and 2015 the premium allocable to those years. 1040ez instructions 2011 More information. 1040ez instructions 2011   For more information about deducting insurance, see chapter 6 in Publication 535. 1040ez instructions 2011 Interest You can generally deduct as a business expense all interest you pay or accrue during the tax year on debts related to your business. 1040ez instructions 2011 Interest relates to your business if you use the proceeds of the loan for a business expense. 1040ez instructions 2011 It does not matter what type of property secures the loan. 1040ez instructions 2011 You can deduct interest on a debt only if you meet all of the following requirements. 1040ez instructions 2011 You are legally liable for that debt. 1040ez instructions 2011 Both you and the lender intend that the debt be repaid. 1040ez instructions 2011 You and the lender have a true debtor-creditor relationship. 1040ez instructions 2011 You cannot deduct on Schedule C or C-EZ the interest you paid on personal loans. 1040ez instructions 2011 If a loan is part business and part personal, you must divide the interest between the personal part and the business part. 1040ez instructions 2011 Example. 1040ez instructions 2011 In 2013, you paid $600 interest on a car loan. 1040ez instructions 2011 During 2013, you used the car 60% for business and 40% for personal purposes. 1040ez instructions 2011 You are claiming actual expenses on the car. 1040ez instructions 2011 You can only deduct $360 (60% × $600) for 2013 on Schedule C or C-EZ. 1040ez instructions 2011 The remaining interest of $240 is a nondeductible personal expense. 1040ez instructions 2011 More information. 1040ez instructions 2011   For more information about deducting interest, see chapter 4 in Publication 535. 1040ez instructions 2011 That chapter explains the following items. 1040ez instructions 2011 Interest you can deduct. 1040ez instructions 2011 Interest you cannot deduct. 1040ez instructions 2011 How to allocate interest between personal and business use. 1040ez instructions 2011 When to deduct interest. 1040ez instructions 2011 The rules for a below-market interest rate loan. 1040ez instructions 2011 (This is generally a loan on which no interest is charged or on which interest is charged at a rate below the applicable federal rate. 1040ez instructions 2011 ) Legal and Professional Fees Legal and professional fees, such as fees charged by accountants, that are ordinary and necessary expenses directly related to operating your business are deductible on Schedule C or C-EZ. 1040ez instructions 2011 However, you usually cannot deduct legal fees you pay to acquire business assets. 1040ez instructions 2011 Add them to the basis of the property. 1040ez instructions 2011 If the fees include payments for work of a personal nature (such as making a will), you can take a business deduction only for the part of the fee related to your business. 1040ez instructions 2011 The personal part of legal fees for producing or collecting taxable income, doing or keeping your job, or for tax advice may be deductible on Schedule A (Form 1040) if you itemize deductions. 1040ez instructions 2011 For more information, see Publication 529, Miscellaneous Deductions. 1040ez instructions 2011 Tax preparation fees. 1040ez instructions 2011   You can deduct on Schedule C or C-EZ the cost of preparing that part of your tax return relating to your business as a sole proprietor or statutory employee. 1040ez instructions 2011 You can deduct the remaining cost on Schedule A (Form 1040) if you itemize your deductions. 1040ez instructions 2011   You can also deduct on Schedule C or C-EZ the amount you pay or incur in resolving asserted tax deficiencies for your business as a sole proprietor or statutory employee. 1040ez instructions 2011 Pension Plans You can set up and maintain the following small business retirement plans for yourself and your employees. 1040ez instructions 2011 SEP (Simplified Employee Pension) plans. 1040ez instructions 2011 SIMPLE (Savings Incentive Match Plan for Employees) plans. 1040ez instructions 2011 Qualified plans (including Keogh or H. 1040ez instructions 2011 R. 1040ez instructions 2011 10 plans). 1040ez instructions 2011 SEP, SIMPLE, and qualified plans offer you and your employees a tax favored way to save for retirement. 1040ez instructions 2011 You can deduct contributions you make to the plan for your employees on line 19 of Schedule C. 1040ez instructions 2011 If you are a sole proprietor, you can deduct contributions you make to the plan for yourself on line 28 of Form 1040. 1040ez instructions 2011 You can also deduct trustees' fees if contributions to the plan do not cover them. 1040ez instructions 2011 Earnings on the contributions are generally tax free until you or your employees receive distributions from the plan. 1040ez instructions 2011 You may also be able to claim a tax credit of 50% of the first $1,000 of qualified startup costs if you begin a new qualified defined benefit or defined contribution plan (including a 401(k) plan), SIMPLE plan, or simplified employee pension. 1040ez instructions 2011 Under certain plans, employees can have you contribute limited amounts of their before-tax pay to a plan. 1040ez instructions 2011 These amounts (and earnings on them) are generally tax free until your employees receive distributions from the plan. 1040ez instructions 2011 For more information on retirement plans for small business, see Publication 560, Retirement Plans for Small Business (SEP, SIMPLE, and Qualified Plans). 1040ez instructions 2011 Publication 590, Individual Retirement Arrangements (IRAs), discusses other tax favored ways to save for retirement. 1040ez instructions 2011 Rent Expense Rent is any amount you pay for the use of property you do not own. 1040ez instructions 2011 In general, you can deduct rent as a business expense only if the rent is for property you use in your business. 1040ez instructions 2011 If you have or will receive equity in or title to the property, you cannot deduct the rent. 1040ez instructions 2011 Unreasonable rent. 1040ez instructions 2011   You cannot take a rental deduction for unreasonable rents. 1040ez instructions 2011 Ordinarily, the issue of reasonableness arises only if you and the lessor are related. 1040ez instructions 2011 Rent paid to a related person is reasonable if it is the same amount you would pay to a stranger for use of the same property. 1040ez instructions 2011 Rent is not unreasonable just because it is figured as a percentage of gross receipts. 1040ez instructions 2011   Related persons include members of your immediate family, including only brothers and sisters (either whole or half), your spouse, ancestors, and lineal descendants. 1040ez instructions 2011 For a list of the other related persons, see section 267 of the Internal Revenue Code. 1040ez instructions 2011 Rent on your home. 1040ez instructions 2011   If you rent your home and use part of it as your place of business, you may be able to deduct the rent you pay for that part. 1040ez instructions 2011 You must meet the requirements for business use of your home. 1040ez instructions 2011 For more information, see Business Use of Your Home , later. 1040ez instructions 2011 Rent paid in advance. 1040ez instructions 2011   Generally, rent paid in your business is deductible in the year paid or accrued. 1040ez instructions 2011 If you pay rent in advance, you can deduct only the amount that applies to your use of the rented property during the tax year. 1040ez instructions 2011 You can deduct the rest of your payment only over the period to which it applies. 1040ez instructions 2011 More information. 1040ez instructions 2011   For more information about rent, see chapter 3 in Publication 535. 1040ez instructions 2011 Taxes You can deduct on Schedule C or C-EZ various federal, state, local, and foreign taxes directly attributable to your business. 1040ez instructions 2011 Income taxes. 1040ez instructions 2011   You can deduct on Schedule C or C-EZ a state tax on gross income (as distinguished from net income) directly attributable to your business. 1040ez instructions 2011 You can deduct other state and local income taxes on Schedule A (Form 1040) if you itemize your deductions. 1040ez instructions 2011 Do not deduct federal income tax. 1040ez instructions 2011 Employment taxes. 1040ez instructions 2011   You can deduct the social security, Medicare, and federal unemployment (FUTA) taxes you paid out of your own funds as an employer. 1040ez instructions 2011 Employment taxes are discussed briefly in chapter 1. 1040ez instructions 2011 You can also deduct payments you made as an employer to a state unemployment compensation fund or to a state disability benefit fund. 1040ez instructions 2011 Deduct these payments as taxes. 1040ez instructions 2011 Self-employment tax. 1040ez instructions 2011   You can deduct one-half of your self-employment tax on line 27 of Form 1040. 1040ez instructions 2011 Self-employment tax is discussed in chapters 1 and 10. 1040ez instructions 2011 Personal property tax. 1040ez instructions 2011   You can deduct on Schedule C or C-EZ any tax imposed by a state or local government on personal property used in your business. 1040ez instructions 2011   You can also deduct registration fees for the right to use property within a state or local area. 1040ez instructions 2011 Example. 1040ez instructions 2011 May and Julius Winter drove their car 7,000 business miles out of a total of 10,000 miles. 1040ez instructions 2011 They had to pay $25 for their annual state license tags and $20 for their city registration sticker. 1040ez instructions 2011 They also paid $235 in city personal property tax on the car, for a total of $280. 1040ez instructions 2011 They are claiming their actual car expenses. 1040ez instructions 2011 Because they used the car 70% for business, they can deduct 70% of the $280, or $196, as a business expense. 1040ez instructions 2011 Real estate taxes. 1040ez instructions 2011   You can deduct on Schedule C or C-EZ the real estate taxes you pay on your business property. 1040ez instructions 2011 Deductible real estate taxes are any state, local, or foreign taxes on real estate levied for the general public welfare. 1040ez instructions 2011 The taxing authority must base the taxes on the assessed value of the real estate and charge them uniformly against all property under its jurisdiction. 1040ez instructions 2011   For more information about real estate taxes, see chapter 5 in Publication 535. 1040ez instructions 2011 That chapter explains special rules for deducting the following items. 1040ez instructions 2011 Taxes for local benefits, such as those for sidewalks, streets, water mains, and sewer lines. 1040ez instructions 2011 Real estate taxes when you buy or sell property during the year. 1040ez instructions 2011 Real estate taxes if you use an accrual method of accounting and choose to accrue real estate tax related to a definite period ratably over that period. 1040ez instructions 2011 Sales tax. 1040ez instructions 2011   Treat any sales tax you pay on a service or on the purchase or use of property as part of the cost of the service or property. 1040ez instructions 2011 If the service or the cost or use of the property is a deductible business expense, you can deduct the tax as part of that service or cost. 1040ez instructions 2011 If the property is merchandise bought for resale, the sales tax is part of the cost of the merchandise. 1040ez instructions 2011 If the property is depreciable, add the sales tax to the basis for depreciation. 1040ez instructions 2011 For information on the basis of property, see Publication 551, Basis of Assets. 1040ez instructions 2011    Do not deduct state and local sales taxes imposed on the buyer that you must collect and pay over to the state or local government. 1040ez instructions 2011 Do not include these taxes in gross receipts or sales. 1040ez instructions 2011 Excise taxes. 1040ez instructions 2011   You can deduct on Schedule C or C-EZ all excise taxes that are ordinary and necessary expenses of carrying on your business. 1040ez instructions 2011 Excise taxes are discussed briefly in chapter 1. 1040ez instructions 2011 Fuel taxes. 1040ez instructions 2011   Taxes on gasoline, diesel fuel, and other motor fuels you use in your business are usually included as part of the cost of the fuel. 1040ez instructions 2011 Do not deduct these taxes as a separate item. 1040ez instructions 2011   You may be entitled to a credit or refund for federal excise tax you paid on fuels used for certain purposes. 1040ez instructions 2011 For more information, see Publication 510, Excise Taxes. 1040ez instructions 2011 Travel, Meals, and Entertainment This section briefly explains the kinds of travel and entertainment expenses you can deduct on Schedule C or C-EZ. 1040ez instructions 2011 Table 8-1. 1040ez instructions 2011 When Are Entertainment Expenses Deductible? (Note. 1040ez instructions 2011 The following is a summary of the rules for deducting entertainment expenses. 1040ez instructions 2011 For more details about these rules, see Publication 463. 1040ez instructions 2011 ) General rule You can deduct ordinary and necessary expenses to entertain a client, customer, or employee if the expenses meet the directly-related test or the associated test. 1040ez instructions 2011 Definitions Entertainment includes any activity generally considered to provide entertainment, amusement, or recreation, and includes meals provided to a customer or client. 1040ez instructions 2011 An ordinary expense is one that is common and accepted in your field of business, trade, or profession. 1040ez instructions 2011 A necessary expense is one that is helpful and appropriate, although not necessarily required, for your business. 1040ez instructions 2011 Tests to be met Directly-related test Entertainment took place in a clear business setting, or Main purpose of entertainment was the active conduct of business, and You did engage in business with the person during the entertainment period, and You had more than a general expectation of getting income or some other specific business benefit. 1040ez instructions 2011   Associated test Entertainment is associated with your trade or business, and Entertainment directly precedes or follows a substantial business discussion. 1040ez instructions 2011 Other rules You cannot deduct the cost of your meal as an entertainment expense if you are claiming the meal as a travel expense. 1040ez instructions 2011 You cannot deduct expenses that are lavish or extravagant under the circumstances. 1040ez instructions 2011 You generally can deduct only 50% of your unreimbursed entertainment expenses. 1040ez instructions 2011 Travel expenses. 1040ez instructions 2011   These are the ordinary and necessary expenses of traveling away from home for your business. 1040ez instructions 2011 You are traveling away from home if both the following conditions are met. 1040ez instructions 2011 Your duties require you to be away from the general area of your tax home (defined later) substantially longer than an ordinary day's work. 1040ez instructions 2011 You need to get sleep or rest to meet the demands of your work while away from home. 1040ez instructions 2011 Generally, your tax home is your regular place of business, regardless of where you maintain your family home. 1040ez instructions 2011 It includes the entire city or general area in which your business is located. 1040ez instructions 2011 See Publication 463 for more information. 1040ez instructions 2011   The following is a brief discussion of the expenses you can deduct. 1040ez instructions 2011 Transportation. 1040ez instructions 2011   You can deduct the cost of travel by airplane, train, bus, or car between your home and your business destination. 1040ez instructions 2011 Taxi, commuter bus, and limousine. 1040ez instructions 2011   You can deduct fares for these and other types of transportation between the airport or station and your hotel, or between the hotel and your work location away from home. 1040ez instructions 2011 Baggage and shipping. 1040ez instructions 2011   You can deduct the cost of sending baggage and sample or display material between your regular and temporary work locations. 1040ez instructions 2011 Car or truck. 1040ez instructions 2011   You can deduct the costs of operating and maintaining your vehicle when traveling away from home on business. 1040ez instructions 2011 You can deduct actual expenses or the standard mileage rate (discussed earlier under Car and Truck Expenses), as well as business-related tolls and parking. 1040ez instructions 2011 If you rent a car while away from home on business, you can deduct only the business-use portion of the expenses. 1040ez instructions 2011 Meals and lodging. 1040ez instructions 2011   You can deduct the cost of meals and lodging if your business trip is overnight or long enough that you need to stop for sleep or rest to properly perform your duties. 1040ez instructions 2011 In most cases, you can deduct only 50% of your meal expenses. 1040ez instructions 2011 Cleaning. 1040ez instructions 2011   You can deduct the costs of dry cleaning and laundry while on your business trip. 1040ez instructions 2011 Telephone. 1040ez instructions 2011   You can deduct the cost of business calls while on your business trip, including business communication by fax machine or other communication devices. 1040ez instructions 2011 Tips. 1040ez instructions 2011   You can deduct the tips you pay for any expense in this list. 1040ez instructions 2011 More information. 1040ez instructions 2011   For more information about travel expenses, see Publication 463. 1040ez instructions 2011 Entertainment expenses. 1040ez instructions 2011   You may be able to deduct business-related entertainment expenses for entertaining a client, customer, or employee. 1040ez instructions 2011 In most cases, you can deduct only 50% of these expenses. 1040ez instructions 2011   The following are examples of entertainment expenses. 1040ez instructions 2011 Entertaining guests at nightclubs, athletic clubs, theaters, or sporting events. 1040ez instructions 2011 Providing meals, a hotel suite, or a car to business customers or their families. 1040ez instructions 2011 To be deductible, the expenses must meet the rules listed in Table 8-1. 1040ez instructions 2011 For details about these rules, see Publication 463. 1040ez instructions 2011 Reimbursing your employees for expenses. 1040ez instructions 2011   You generally can deduct the amount you reimburse your employees for travel and entertainment expenses. 1040ez instructions 2011 The reimbursement you deduct and the manner in which you deduct it depend in part on whether you reimburse the expenses under an accountable plan or a nonaccountable plan. 1040ez instructions 2011 For details, see chapter 11 in Publication 535. 1040ez instructions 2011 That chapter explains accountable and nonaccountable plans and tells you whether to report the reimbursement on your employee's Form W-2, Wage and Tax Statement. 1040ez instructions 2011 Business Use of Your Home To deduct expenses related to the part of your home used for business, you must meet specific requirements. 1040ez instructions 2011 Even then, your deduction may be limited. 1040ez instructions 2011 To qualify to claim expenses for business use of your home, you must meet the following tests. 1040ez instructions 2011 Your use of the business part of your home must be: Exclusive (however, see Exceptions to exclusive use , later), Regular, For your business, and The business part of your home must be one of the following: Your principal place of business (defined later), A place where you meet or deal with patients, clients, or customers in the normal course of your business, or A separate structure (not attached to your home) you use in connection with your business. 1040ez instructions 2011 Exclusive use. 1040ez instructions 2011   To qualify under the exclusive use test, you must use a specific area of your home only for your trade or business. 1040ez instructions 2011 The area used for business can be a room or other separately identifiable space. 1040ez instructions 2011 The space does not need to be marked off by a permanent partition. 1040ez instructions 2011   You do not meet the requirements of the exclusive use test if you use the area in question both for business and for personal purposes. 1040ez instructions 2011 Example. 1040ez instructions 2011 You are an attorney and use a den in your home to write legal briefs and prepare clients' tax returns. 1040ez instructions 2011 Your family also uses the den for recreation. 1040ez instructions 2011 The den is not used exclusively in your profession, so you cannot claim a business deduction for its use. 1040ez instructions 2011 Exceptions to exclusive use. 1040ez instructions 2011   You do not have to meet the exclusive use test if you use part of your home in either of the following ways. 1040ez instructions 2011 For the storage of inventory or product samples. 1040ez instructions 2011 As a daycare facility. 1040ez instructions 2011 For an explanation of these exceptions, see Publication 587, Business Use of Your Home (Including Use by Daycare Providers). 1040ez instructions 2011 Regular use. 1040ez instructions 2011   To qualify under the regular use test, you must use a specific area of your home for business on a continuing basis. 1040ez instructions 2011 You do not meet the test if your business use of the area is only occasional or incidental, even if you do not use that area for any other purpose. 1040ez instructions 2011 Principal place of business. 1040ez instructions 2011   You can have more than one business location, including your home, for a single trade or business. 1040ez instructions 2011 To qualify to deduct the expenses for the business use of your home under the principal place of business test, your home must be your principal place of business for that business. 1040ez instructions 2011 To determine your principal place of business, you must consider all the facts and circumstances. 1040ez instructions 2011   Your home office will qualify as your principal place of business for deducting expenses for its use if you meet the following requirements. 1040ez instructions 2011 You use it exclusively and regularly for administrative or management activities of your business. 1040ez instructions 2011 You have no other fixed location where you conduct substantial administrative or management activities of your business. 1040ez instructions 2011   Alternatively, if you use your home exclusively and regularly for your business, but your home office does not qualify as your principal place of business based on the previous rules, you determine your principal place of business based on the following factors. 1040ez instructions 2011 The relative importance of the activities performed at each location. 1040ez instructions 2011 If the relative importance factor does not determine your principal place of business, you can also consider the time spent at each location. 1040ez instructions 2011   If, after considering your business locations, your home cannot be identified as your principal place of business, you cannot deduct home office expenses. 1040ez instructions 2011 However, for other ways to qualify to deduct home office expenses, see Publication 587. 1040ez instructions 2011 Deduction limit. 1040ez instructions 2011   If your gross income from the business use of your home equals or exceeds your total business expenses (including depreciation), you can deduct all your business expenses related to the use of your home. 1040ez instructions 2011 If your gross income from the business use is less than your total business expenses, your deduction for certain expenses for the business use of your home is limited. 1040ez instructions 2011   Your deduction of otherwise nondeductible expenses, such as insurance, utilities, and depreciation (with depreciation taken last), allocable to the business is limited to the gross income from the business use of your home minus the sum of the following. 1040ez instructions 2011 The business part of expenses you could deduct even if you did not use your home for business (such as mortgage interest, real estate taxes, and casualty and theft losses that are allowable as itemized deductions on Schedule A (Form 1040)). 1040ez instructions 2011 The business expenses that relate to the business activity in the home (for example, business phone, supplies, and depreciation on equipment), but not to the use of the home itself. 1040ez instructions 2011 Do not include in (2) above your deduction for one-half of your self-employment tax. 1040ez instructions 2011   Use Form 8829, Expenses for Business Use of Your Home, to figure your deduction. 1040ez instructions 2011 New simplified method. 1040ez instructions 2011    The IRS now provides a simplified method to determine your expenses for business use of your home. 1040ez instructions 2011 The simplified method is an alternative to calculating and substantiating actual expenses. 1040ez instructions 2011 In most cases, you will figure your deduction by multiplying $5 by the area of your home used for a qualified business use. 1040ez instructions 2011 The area you use to figure your deduction is limited to 300 square feet. 1040ez instructions 2011 For more information, see the Instructions for Schedule C. 1040ez instructions 2011 More information. 1040ez instructions 2011   For more information on deducting expenses for the business use of your home, see Publication 587. 1040ez instructions 2011 Other Expenses You Can Deduct You may also be able to deduct the following expenses. 1040ez instructions 2011 See Publication 535 to find out whether you can deduct them. 1040ez instructions 2011 Advertising. 1040ez instructions 2011 Bank fees. 1040ez instructions 2011 Donations to business organizations. 1040ez instructions 2011 Education expenses. 1040ez instructions 2011 Energy efficient commercial buildings deduction expenses. 1040ez instructions 2011 Impairment-related expenses. 1040ez instructions 2011 Interview expense allowances. 1040ez instructions 2011 Licenses and regulatory fees. 1040ez instructions 2011 Moving machinery. 1040ez instructions 2011 Outplacement services. 1040ez instructions 2011 Penalties and fines you pay for late performance or nonperformance of a contract. 1040ez instructions 2011 Repairs that keep your property in a normal efficient operating condition. 1040ez instructions 2011 Repayments of income. 1040ez instructions 2011 Subscriptions to trade or professional publications. 1040ez instructions 2011 Supplies and materials. 1040ez instructions 2011 Utilities. 1040ez instructions 2011 Expenses You Cannot Deduct You usually cannot deduct the following as business expenses. 1040ez instructions 2011 For more information, see Publication 535. 1040ez instructions 2011 Bribes and kickbacks. 1040ez instructions 2011 Charitable contributions. 1040ez instructions 2011 Demolition expenses or losses. 1040ez instructions 2011 Dues to business, social, athletic, luncheon, sporting, airline, and hotel clubs. 1040ez instructions 2011 Lobbying expenses. 1040ez instructions 2011 Penalties and fines you pay to a governmental agency or instrumentality because you broke the law. 1040ez instructions 2011 Personal, living, and family expenses. 1040ez instructions 2011 Political contributions. 1040ez instructions 2011 Repairs that add to the value of your property or significantly increase its life. 1040ez instructions 2011 Prev  Up  Next   Home   More Online Publications