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1040nr 2012 Publication 957 - Main Content Table of Contents 1. 1040nr 2012 What is Back Pay?Reporting Back Pay Back Pay Under a Statute Nonstatutory Back Pay Format for Report to the SSA Questions 2. 1040nr 2012 Special Wage PaymentsReporting Special Wage Payments Reporting Nonstatutory (Nonqualified) Stock Options as Special Wage Payments Nonqualified Deferred Compensation and Section 457 Plans Additional Reporting Examples for Nonqualified Deferred Compensation (NQDC) PlansSpecial rule for box 11 of Form W-2 (distributions and deferral in the same year). 1040nr 2012 1. 1040nr 2012 What is Back Pay? Back pay is pay received in a tax year(s) for actual or deemed employment in an earlier tax year(s). 1040nr 2012 For social security coverage and benefit purposes, all back pay, whether or not under a statute, is wages if it is payment for covered employment. 1040nr 2012 Damages for personal injury, interest, penalties, and legal fees included with back pay awards are not wages. 1040nr 2012 Report all back pay. 1040nr 2012 However, the tax year(s) for which back pay is credited as wages for social security purposes is different if it is awarded under a statute. 1040nr 2012 See Back Pay Under a Statute , later, for more information. 1040nr 2012 Reporting Back Pay The Internal Revenue Service (IRS) and the SSA consider back pay awards to be wages. 1040nr 2012 However, for income tax purposes, the IRS treats all back pay as wages in the year paid. 1040nr 2012 Employers should use Form W-2, Wage and Tax Statement, or electronic wage reports to report back pay as wages in the year they actually pay the employee. 1040nr 2012 The SSA no longer accepts reports on tapes, cartridges, and diskettes. 1040nr 2012 Example. 1040nr 2012 In 2012, Terry Morris earned wages of $50,000. 1040nr 2012 In the same year, she received $100,000 in settlement of a back pay case against her employer that covered the periods January 2007 through December 2011. 1040nr 2012 Her employer properly reflected social security wages of $110,100 and Medicare wages of $150,000 on her 2012 Form W-2. 1040nr 2012 However, if an employer did not include back pay wages on a previously filed Form W-2, magnetic media, or electronically filed wage report, the employer should prepare a wage correction report, Form W-2c, Corrected Wage and Tax Statement, or electronically filed report, to add the back pay award to the wages previously reported. 1040nr 2012 Example. 1040nr 2012 If, in the above example, Terry Morris' employer had prepared her 2012 Form W-2 reporting social security and Medicare wages of only $50,000 each, the employer would have to correct that report. 1040nr 2012 A Form W-2c correcting the 2012 Form W-2 would show previously reported social security and Medicare wages of $50,000 and the correct amount of $110,100 for social security wages and $150,000 for Medicare wages. 1040nr 2012 SSA treatment of back pay under a statute. 1040nr 2012   Under the law, the SSA credits back pay awarded under a statute to an individual's earnings record in the period(s) the wages should have been paid. 1040nr 2012 This is important because wages not credited to the proper year may result in lower social security benefits or failure to meet the requirements for benefits. 1040nr 2012   However, back pay under statute payments will remain posted to the employee's social security earnings record in the year reported on Form W-2 (or Form W-2c) unless the employer or employee notifies the SSA (in a separate, special report) of the back pay under a statute payment. 1040nr 2012 Then, the SSA can allocate the statutory back pay to the appropriate periods. 1040nr 2012   If a back pay award is not made under a statute, the SSA credits back pay as wages in the year paid. 1040nr 2012    If employers do notify the SSA of this payment, they should prepare a special report (with the information noted below) and send it to: Social Security Administration Attn: CPS Back Pay Staff 7-B-15 SWT 1500 Woodlawn Drive Baltimore, MD 21241-0001 Be sure to send this special report to the above address because the SSA handles it separately from other reports. 1040nr 2012    If you paid the back pay award in the same tax year to which it applies, report the wages on that year's Form W-2. 1040nr 2012 No further action is necessary. 1040nr 2012 Example. 1040nr 2012 In 2012, Judy Wilson received a salary of $30,000 and a back pay under statute award of $2,000 for the period January through June 2012. 1040nr 2012 Her employer properly reported wages of $32,000 for social security and Medicare on her 2012 Form W-2. 1040nr 2012 No further action is necessary. 1040nr 2012 Information the SSA needs to properly credit back pay under a statute (special report). 1040nr 2012   After you complete the special report, you or the employee should send it to the SSA when or after you submit the Form W-2 (on paper or electronically) to the SSA for the year you pay the statutory back pay to the employee. 1040nr 2012 There is no statute of limitations on the filing of the special report to enable the SSA to allocate the wages. 1040nr 2012 The special report must include the following information. 1040nr 2012 The employer's name, address, and employer identification number (EIN). 1040nr 2012 A signed statement citing the federal or state statute under which the payment was made. 1040nr 2012 If the statute is not identified, the SSA will assume the payment was not under a statute and will not allocate to earlier period(s). 1040nr 2012 The name and telephone number of a person to contact. 1040nr 2012 The SSA may have additional questions concerning the back pay case or the individual employee's information. 1040nr 2012 A list of employees receiving the payment and the following information for each employee: The tax year you paid and reported the back pay. 1040nr 2012 The employee's social security number (SSN). 1040nr 2012 The employee's name (as shown on his or her social security card). 1040nr 2012 The amount of the back pay award excluding any amounts specifically designated otherwise, for example, damages for personal injury, interest, penalties, and legal fees. 1040nr 2012 The period(s) the back pay award covers (beginning and ending dates—month and year). 1040nr 2012 The other wages paid subject to social security and/or Medicare taxes and reported in the same year as the back pay award (if none, show zero)*. 1040nr 2012 Do not include the back pay award shown in that wage report. 1040nr 2012 If you originally submitted the report under an establishment number, show that number and the amount of money that is to remain under that establishment number. 1040nr 2012 The amount to allocate to each reporting period*. 1040nr 2012 This includes any amount you want allocated (if applicable) to the tax year of the award payment. 1040nr 2012 If you do not give the SSA specific amounts to allocate, the SSA does the allocation by dividing the back pay award by the number of months or years covered by the award. 1040nr 2012 *Note. 1040nr 2012   For periods before January 1, 1978 (before January 1, 1981, for state and local government employers covered by a Section 218 agreement), show the wage amounts for each calendar quarter ending March 31, June 30, September 30, and December 31. 1040nr 2012 For all tax years, show and identify the social security and/or Medicare Qualified Government Employment (MQGE) wages (where applicable) separately. 1040nr 2012 MQGE is applicable to federal employees beginning in 1983, and for certain state and local government employees beginning in 1986. 1040nr 2012 For tax years 1991 and later, list the social security and Medicare wages separately. 1040nr 2012 If you originally reported the individual's wages under an establishment or payroll record unit number, show the amount of wages to remain in the award year for that number and furnish that number to the SSA along with the EIN. 1040nr 2012 Back Pay Under a Statute Back pay awarded under a statute is a payment by an employer following an award, determination, or agreement approved or sanctioned by a court or government agency responsible for enforcing a federal or state statute that protects an employee's right to employment or wages. 1040nr 2012 Examples of pertinent statutes include: Age Discrimination in Employment Act, Americans with Disabilities Act, Equal Pay Act, Fair Labor Standards Act, National Labor Relations Act, State minimum wage laws, and State statutes that protect rights to employment and wages. 1040nr 2012 Payments based on laws that have a similar effect to those listed above also may qualify as payments made under a statute. 1040nr 2012 Back pay awards, under some of the statutes listed above, may be compensation for personal injury and not pay for employment. 1040nr 2012 Such awards are not wages for social security coverage purposes. 1040nr 2012 If a court-approved or sanctioned settlement agreement states that the agreement is not an admission of discrimination, liability, or act of wrongdoing, the statement does not change the nature of a back pay award. 1040nr 2012 The payments made in such a settlement may still be back pay and wages under the rules discussed here. 1040nr 2012 Nonstatutory Back Pay A payment for back wages negotiated between an employer and employee without an award, determination, or agreement approved or sanctioned by a court or government agency, the payment is not made under a statute. 1040nr 2012 Delayed wage payments and retroactive pay increases resulting from union negotiation or payments under local ordinances or regulations are back pay and are wages. 1040nr 2012 However, they are not payments made under a statute. 1040nr 2012 If you are uncertain whether the back pay award was under a qualified statute, you may need to contact your personnel department or legal counsel or the attorney who filed the suit. 1040nr 2012 Format for Report to the SSA Use the format shown in Table 1, later, to send the SSA the information needed to properly credit back pay under a statute. 1040nr 2012 In a cover letter, include: Name and address of the employer, Statute under which you paid the back pay, Name and telephone number of the employer contact, and Signature of the reporting official. 1040nr 2012 Under certain circumstances, back pay may be a special wage payment and excluded from wages counted under the social security earnings test. 1040nr 2012 If you pay back pay to an employee age 61 or older, report it to the SSA in accordance with this section. 1040nr 2012 Read Special Wage Payments, later, for additional reporting instructions. 1040nr 2012 Questions If you have questions concerning back pay under a statute, call the SSA at 1-800-772-6270. 1040nr 2012 Exception. 1040nr 2012   If you are a state or local government employer who was covered by an agreement under Section 218 of the Social Security Act before January 1, 1987, and you paid a back pay award before January 1, 1987, which you did not report to the SSA, contact your state Social Security Administrator's office. 1040nr 2012 Table 1. 1040nr 2012 Format for Report (Under Covering Letter) to Request SSA to Allocate Back Pay Under Statute Wages Employer's EIN: xx-xxxxxxx Tax Year in Which Award Payment Was Paid: 2012 (1) SSN and Employee Name (2)1 Award Amount and Period(s) (3)2,3 Other Soc. 1040nr 2012 Sec. 1040nr 2012 /Med. 1040nr 2012 Wages Paid In Award Year (4)3 Allocation     Soc. 1040nr 2012 Sec. 1040nr 2012 Med. 1040nr 2012 /MQGE Year Soc. 1040nr 2012 Sec. 1040nr 2012 Med. 1040nr 2012 /MQGE xxx-xx-xxxx HELEN T. 1040nr 2012 SMITH $100,000 1/2009 - 12/2012 $40,000 $40,000 2009 2010 2011 2012 $20,000 25,000 27,000 28,000 $20,000 25,000 27,000 28,000 xxx-xx-xxxx SAM W. 1040nr 2012 EVANS 30,000 7/89-12/91 -0- -0- 1989 1990 1991   6,000 12,000 12,000 xxx-xx-xxxx ROLAND S. 1040nr 2012 ADAMS 15,000 7/80-12/81 -0- -0- 9/80 12/80 1981 3,500 3,500 8,000   1Exclude amounts specifically designated as damages, penalties, etc. 1040nr 2012  2Exclude the amount of back pay, if any, included in that amount. 1040nr 2012  3For periods before January 1, 1978 (and for state and local government (Section 218) employers before January 1, 1981), show the wage amounts by calendar quarters. 1040nr 2012 The social security and/or Medicare Qualified Government Employment (MQGE) wages (where applicable) must be shown separately FOR ALL YEARS. 1040nr 2012 (Wages subject ONLY to MQGE would be shown in the Medicare/MQGE column; no wages would be shown in the Soc. 1040nr 2012 Sec. 1040nr 2012 column. 1040nr 2012 ) For tax years 1991 and later, the social security and Medicare wages must be listed separately. 1040nr 2012 Explanation of examples. 1040nr 2012 Helen T. 1040nr 2012 Smith–The back pay award, excluding interest, was $100,000 for the periods 1/2009-12/2012. 1040nr 2012 In 2012, this employee was also paid $40,000 in other wages. 1040nr 2012 (Her Form W-2 for 2012 reported $110,100 for social security and $140,000 for Medicare. 1040nr 2012 The SSA allocation will result in adjusted posted wages of $68,000 for social security and $68,000 for Medicare for 2012. 1040nr 2012 ) Sam W. 1040nr 2012 Evans–The back pay award was $30,000 for the periods 7/89-12/91. 1040nr 2012 This employee was hired in 1989 and was subject to MQGE only. 1040nr 2012 He was no longer employed by this governmental employer in 2012. 1040nr 2012 (His Form W-2 for 2012 reported $30,000 for social security and $30,000 for Medicare. 1040nr 2012 After the SSA allocation, he will not have any net posted wages for 2012. 1040nr 2012 ) Roland S. 1040nr 2012 Adams–The back pay award was $15,000 for the periods 7/80-12/81. 1040nr 2012 He was no longer employed by this state and local government (Section 218) employer in 2012. 1040nr 2012 (His Form W-2 for 2012 reported $15,000 for social security and $15,000 for Medicare; after the SSA allocation, he will not have any net posted wages for 2012. 1040nr 2012 ) If the state Social Security Administrator's office needs more information, they can contact the SSA at the following address:   Social Security Administration Office of Income Security Programs Office of Earnings and Program Integrity Policy 6401 Security Boulevard 2506 OPS Baltimore, MD 21235 2. 1040nr 2012 Special Wage Payments A special wage payment (SWP) is an amount paid by an employer to an employee (or former employee) for services performed in a prior year. 1040nr 2012 Employers should report to the SSA special wage payments made to employees and former employees who are recipients of social security retirement benefits. 1040nr 2012 Special wage payments made to a retired employee receiving social security or to an employee who continues to work while receiving social security benefits may reduce the benefits the individual receives if not reported to the SSA. 1040nr 2012 Special wage payments may include (but are not limited to): Accumulated sick and vacation pay, Back pay, Bonuses, Deferred compensation, Payments because of retirement, Sales commissions, Severance pay, and Stock options. 1040nr 2012 Note. 1040nr 2012 Payments made after retirement that are part of the normal payroll cycle should not be routinely reported as special wage payments. 1040nr 2012 Earnings Test. 1040nr 2012   Benefits paid to a social security beneficiary under full retirement age may be reduced if the beneficiary continues to work. 1040nr 2012 The SSA uses the information in boxes 1, 3, and 5 of Form W-2 to determine the beneficiary's current year earnings. 1040nr 2012 Special wage payments, which are for services performed in a prior year, will increase the current year earnings on Form W-2, which also may result in a reduction in the beneficiary's benefits. 1040nr 2012 If a benefit is reduced because of a special wage payment, the beneficiary must get documentation from the employer before the SSA can restore the deducted portion. 1040nr 2012 Therefore, employer reports of special wage payments help prevent incorrect benefit reductions. 1040nr 2012 Reporting Special Wage Payments Employers must report special wage payments for income tax purposes and social security and Medicare taxes in the year received. 1040nr 2012 Report income, social security, and/or Medicare taxes for special wage payments on Form W-2. 1040nr 2012 See Nonqualified Deferred Compensation and Section 457 Plans, later, for reporting nonqualified deferred compensation plan deferrals and payments on Form W-2. 1040nr 2012 In addition, report to the SSA special wage payments made during the reporting year to retired employees and employees who continue to work while receiving social security benefits. 1040nr 2012 Submit reports after the close of the tax year. 1040nr 2012 To avoid delays in processing, submit reports in time to reach the SSA by April 1. 1040nr 2012 Use one of the following reporting methods. 1040nr 2012 Electronic reporting. 1040nr 2012   Special wage payment files can be sent electronically by logging onto Business Services Online (BSO) via the socialsecurity. 1040nr 2012 gov website. 1040nr 2012 BSO enables organizations and authorized individuals to conduct business with and submit confidential information to the Social Security Administration. 1040nr 2012 You must register to use this website. 1040nr 2012 The web address is www. 1040nr 2012 socialsecurity. 1040nr 2012 gov/bso/bsowelcome. 1040nr 2012 htm. 1040nr 2012   Use the specifications and record layout shown in  Table 2, later. 1040nr 2012 Only one file at a time may be submitted. 1040nr 2012 If your file is large (>10MB), or you have a slow internet connection, the transmission will be faster if the file is zipped. 1040nr 2012 A zipped file contains a file that has been compressed to reduce its file size. 1040nr 2012 WinZip and PKZIP are examples of acceptable compression packages. 1040nr 2012   Electronic submissions not meeting the specifications in Table 2 will be rejected. 1040nr 2012 Paper listing. 1040nr 2012   A paper listing can be used to report special wage payments to several employees. 1040nr 2012 Use the format shown in Table 3, later. 1040nr 2012 Submit paper listings to the local SSA office nearest your place of business. 1040nr 2012 Visit www. 1040nr 2012 socialsecurity. 1040nr 2012 gov/locator to find a Social Security office near you. 1040nr 2012 Form SSA-131. 1040nr 2012   Use Form SSA-131 to report special wage payments made to an employee. 1040nr 2012 Also use this form to report nonqualified deferred compensation and section 457 plan deferrals and payments that could not be reported in box 11 of Form W-2. 1040nr 2012    This image is too large to be displayed in the current screen. 1040nr 2012 Please click the link to view the image. 1040nr 2012 Publication 957 Reporting Back Pay to the Social Security Administration Instructions for Form SSA–131   EMPLOYER INSTRUCTIONS FOR COMPLETING SPECIAL WAGE PAYMENT FORM 1. 1040nr 2012 Provide the EIN that was used or will be used to report the employee's wages on the Form W-2. 1040nr 2012 2. 1040nr 2012 Enter the date the employee retired. 1040nr 2012 Enter “Not Retired” if the employee has not retired. 1040nr 2012 3. 1040nr 2012 Enter the date that the employee last performed services; was not expected to return to work; and was not subject to recall to render additional services. 1040nr 2012 This date should be the same as or earlier than the date in item “2”. 1040nr 2012 Enter “Not Retired” if the employee has not retired. 1040nr 2012 4. 1040nr 2012 Enter the wages that were paid to the employee in the tax year that were for services that were performed in years prior to the tax year or that were paid on account of retirement. 1040nr 2012  Examples (not all inclusive) of payments to be included: Payments in lieu of vacation that were earned in a year prior to the tax year. 1040nr 2012 Accumulated sick payments which were paid in a lump sum based on “retirement” as the sole condition of payment. 1040nr 2012 Accumulated sick payments paid at or after the date in item 3, which were earned in a year prior to the tax year. 1040nr 2012 Payments “on account of retirement”–dismissal, severance or termination pay paid because of retirement. 1040nr 2012 Bonuses which are paid pursuant to a prior contract, agreement or promise causing the employee to expect such payments regularly; or announced to induce the employee to work more steadily, rapidly or efficiently or to remain with the employer. 1040nr 2012 Stock Options. 1040nr 2012   Do not include in item “4” payments: For annual, sick, holiday, or vacation pay if used (absence from work) prior to the date of retirement (earlier of items “2” or “3”). 1040nr 2012 That were reported or will be reported under “Nonqualified Plans” on the Form W-2. 1040nr 2012 That were deducted from the employee's wages and paid to a deferred compensation plan (e. 1040nr 2012 g. 1040nr 2012 , 401k). 1040nr 2012 Employees health and dental plan benefits (non-covered/non-taxable for Social Security Wages). 1040nr 2012 Bonuses earned and paid in the tax year. 1040nr 2012 5. 1040nr 2012 Check whether payments listed in item 4 will be made for years after the tax year. 1040nr 2012 If yes, please show the amounts and years in which these will be paid, if known. 1040nr 2012 6. 1040nr 2012 Nonqualified deferred compensation and section 457 plans only. 1040nr 2012 If you were unable to report nonqualified deferred compensation or section 457 plan payments and deferrals (contributions) on Form W-2 because both payments and deferrals occurred during the year, show the amount of wages earned by the employee during the tax year. 1040nr 2012 Generally, the wages earned will be the compensation reported in block 1 of Form W-2 less payments from a nonqualified deferred compensation (or 457) plan, but including any amounts deferred under the plan during the tax year (See IRS Publication 957). 1040nr 2012 Paperwork/Privacy Act Notice: This report is authorized by regulation 20 CFR 404. 1040nr 2012 702. 1040nr 2012 The information that you provide will be used in making a determination regarding the amount of Social Security benefits payable to the above named individual. 1040nr 2012 While your response is voluntary, if you do not respond we may not be able to make a correct determination regarding the amount of Social Security benefits payable to the above named individual for the year in question. 1040nr 2012 We may also use the information you give us when we match records by computer. 1040nr 2012 Matching programs compare our records with those of other Federal, State, or local government agencies. 1040nr 2012 Many agencies may use matching programs to find or prove that a person qualifies for benefits paid by the Federal Government. 1040nr 2012 The law allows us to do this even if you do not agree to it. 1040nr 2012 Explanations about these and other reasons why information you provide us may be used or given out are available in Social Security Offices. 1040nr 2012 If you want to learn more about this, contact any Social Security Office. 1040nr 2012 The Paperwork Reduction Act: This information collection meets the clearance requirements of 44 U. 1040nr 2012 S. 1040nr 2012 C. 1040nr 2012 §3507, as amended by Section 2 of the Paperwork Reduction Act of 1995. 1040nr 2012 You are not required to answer these questions unless we display a valid Office of Management and Budget control number. 1040nr 2012 We estimate that it will take you about 20 minutes to read the instructions, gather the necessary facts, and answer the questions. 1040nr 2012 Form SSA-131 (8-2001) EF (06-2002)   Submit Form SSA-131 to the SSA office nearest your place of business. 1040nr 2012 Or, the employee can submit it to the SSA office handling the claim. 1040nr 2012 You or the employee must submit this form before the SSA can exclude the special wage payments for purposes of the earnings test. 1040nr 2012 If reporting on more than one employee, complete a separate Form SSA-131 for each employee or use the paper listing format (except for reporting nonqualified and section 457 plan deferrals and payments) in Table 3. 1040nr 2012 Do not report payments from nonqualified deferred compensation or section 457 plans that were reported in box 11 of Form W-2. 1040nr 2012 Use Form SSA-131 if deferrals to and payments from nonqualified or section 457 plans occurred during the tax year. 1040nr 2012 Reporting Nonstatutory (Nonqualified) Stock Options as Special Wage Payments A nonstatutory (nonqualified) option to purchase stock which is exercised in a year after the year in which the option was earned is a special wage payment. 1040nr 2012 It should not count for the social security earnings test. 1040nr 2012 Nonstatutory (nonqualified) options exercised as special wage payments by retired employees or employees who continue to work while receiving social security benefits should be reported by employers using the above reporting methods. 1040nr 2012 Nonqualified Deferred Compensation and Section 457 Plans A nonqualified deferred compensation plan is a plan or arrangement established and maintained by an employer for one or more of its employees that provides for the deferral of compensation, but does not meet the requirements for a tax-qualified deferred compensation plan. 1040nr 2012 For social security and Medicare purposes, deferred compensation plans for employees of state and local governments (section 457 plans) are treated the same as nonqualified plans. 1040nr 2012 Nonqualified and section 457 plans are reported differently than other special wage payments. 1040nr 2012 See Reporting Amounts Deferred to Nonqualified and Section 457 Plans below for specific instructions. 1040nr 2012 Reporting Amounts Deferred to Nonqualified and Section 457 Plans Generally, when the related services are performed, nonqualified deferred compensation is subject to social security and Medicare tax when deferred. 1040nr 2012 However, if nonqualified and section 457 plans contain provisions that delay the employee's right to receive payments from the plan, a period of substantial risk of forfeiture exists. 1040nr 2012 The plans' deferrals, or contributions, are not subject to social security and Medicare taxes until the period of substantial risk of forfeiture ends. 1040nr 2012 No risk of forfeiture. 1040nr 2012   If there is no risk of forfeiture, report wage amounts deferred to a nonqualified deferred compensation or section 457 plan in box 3 (up to the wage base maximum) and/or box 5 of Form W-2. 1040nr 2012 Example. 1040nr 2012 Company X's nonqualified deferred compensation plan allows the deferral of up to $20,000 of employee salaries each year. 1040nr 2012 The plan has no risk of forfeiture. 1040nr 2012 In 2012, Employee A defers $20,000 to the plan from a total salary of $200,000. 1040nr 2012 Form W-2 Completion Amount Box 1 $200,000 Box 3* 110,100 Box 5 200,000 *Wage base maximum for tax year 2012 Risk of forfeiture lapses before retirement. 1040nr 2012   If the substantial risk of forfeiture lapses before the employee retires, report all past contributions to the plan (or the value of the plan), including accumulated earned interest, in box 3 (up to the wage base maximum) and/or box 5 of Form W-2. 1040nr 2012 The accumulated deferrals are reported along with any other social security and Medicare wages earned during the year. 1040nr 2012   Report in box 11 of Form W-2 the amount of deferrals, including any accumulated interest, that became taxable for social security and Medicare taxes during the year (but were for prior year services) because the deferred amounts were no longer subject to a substantial risk of forfeiture. 1040nr 2012 If the employee continues working, future deferrals are social security and Medicare wages when they are earned. 1040nr 2012    Do not include in box 11 deferrals that are included in boxes 3 and/or 5 and that are for current year services. 1040nr 2012 Risk of forfeiture lapses at retirement. 1040nr 2012   When an employee's right to a payment is contingent upon working until retirement, report all past contributions to the plan (or the value of the plan), including accumulated earned interest, as social security and/or Medicare wages in the year of retirement. 1040nr 2012 Add the amount to other wages paid in that year, and enter in box 3 (up to the wage base maximum) and/or box 5 of Form W-2. 1040nr 2012   Report in box 11 of Form W-2 the amount of deferrals, including any accumulated interest, that became taxable for social security and Medicare taxes during the year (but were for prior year services) because the deferred amounts were no longer subject to a substantial risk of forfeiture. 1040nr 2012    Do not include in box 11 deferrals that are included in boxes 3 and/or 5 and that are for current year services. 1040nr 2012 Example—risk of forfeiture. 1040nr 2012 At the end of the risk-of-forfeiture period for Company Y's nonqualified deferred compensation plan, Employee B's accumulated deferrals, plus interest earned by the plan, are $120,000, not including B's $20,000 deferral for this year. 1040nr 2012 B's wages, including this year's deferred amount, are $80,000. 1040nr 2012 Form W-2 Completion Amount Box 1 $60,000 Box 3* 110,100 Box 5 200,000 Box 11 120,000 *Wage base maximum for tax year 2012 Reporting Payments From Nonqualified and Nongovernmental Section 457 Plans When an employee or former employee retires and begins receiving payments (distributions) from a nonqualified or nongovernmental section 457 plan, report the payments in boxes 1 and 11 of Form W-2. 1040nr 2012 Report payments (distributions) from a governmental section 457 plan on Form 1099-R, Distributions from Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc. 1040nr 2012 Example. 1040nr 2012 Employee D retired from the XYZ company and began receiving social security benefits. 1040nr 2012 XYZ paid D a $12,000 bonus upon retirement for sales made in a prior year, and D received $25,000 in payments from XYZ's nonqualified deferred compensation plan. 1040nr 2012 In addition, D agreed to continue performing services for XYZ, but on a part-time basis for wages of $15,000 per year. 1040nr 2012 D made no deferrals to the nonqualified plan this year. 1040nr 2012 Form W-2 Completion Amount Box 1 $52,000 Box 3 27,000 Box 5 27,000 Box 11 25,000 Report the $12,000 bonus to the SSA using electronic reporting, a paper listing, or Form SSA-131. 1040nr 2012 For more information, see Reporting Special Wage Payments , earlier. 1040nr 2012 Reporting Payments and Deferrals in the Same Year Do not complete box 11 when payments (distributions) are made from a nonqualified plan and deferrals are reported in boxes 3 and/or 5 of Form W-2 (including current year deferrals). 1040nr 2012 Report to the SSA on Form SSA-131 the total amount the employee earned during the tax year. 1040nr 2012 Normally, the amount earned is the amount reported in box 1 of Form W-2 less payments from a nonqualified or section 457 plan, but including any amounts deferred under the plan during the tax year. 1040nr 2012 See Form SSA-131 and its instructions, earlier. 1040nr 2012 Example. 1040nr 2012 Employee K retired this year from Company XYZ and began receiving social security benefits. 1040nr 2012 During the year he earned wages of $50,000 and deferred $35,000 of the wages into the company's nonqualified deferred compensation plan. 1040nr 2012 K also received $75,000 in payments from the company's nonqualified plan. 1040nr 2012 Form W-2 Completion Amount Special Wage Payment $75,000 Wages 50,000 Minus: deferral 35,000 Total reported in Box 1 $90,000     Wages including deferral reported in  Boxes 3 and 5 $50,000     Leave Box 11 blank. 1040nr 2012 File Form SSA-131 -0-     Form SSA-131 Completion Amount from Box 1 of Form W-2 $90,000 Minus: payments from a nonqualified plan 75,000 Plus: amounts deferred into the plan during the year 35,000 Total wages earned for purposes of Form SSA-131 (item 6) $50,000 Additional Reporting Examples for Nonqualified Deferred Compensation (NQDC) Plans It is not necessary to show amounts deferred during the year under an NQDC plan subject to section 409A. 1040nr 2012 If you report section 409A deferrals, show the amount in box 12 of Form W-2 using code Y. 1040nr 2012 For more information, see Notice 2008-115, 2008-52 I. 1040nr 2012 R. 1040nr 2012 B. 1040nr 2012 1367, available at www. 1040nr 2012 irs. 1040nr 2012 gov/irb/2008-52_IRB/ar10. 1040nr 2012 html. 1040nr 2012 Special reporting rules apply when an NQDC plan is not compliant with section 409A (when there has been a “plan failure”). 1040nr 2012 Income included under section 409A from an NQDC plan is reported in box 1 and box 12 of Form W-2 using code Z. 1040nr 2012 See Notice 2008-115. 1040nr 2012 The following examples use small dollar amounts for illustrative purposes. 1040nr 2012 However, the amount reported in box 3 of Form W-2 is always limited by the social security earnings wage base (for example, $110,100 for 2012). 1040nr 2012 The term “vested” in the following examples means that the amount deferred is not subject to a substantial risk of forfeiture. 1040nr 2012 Conversely, the term “not vested” means that the amount deferred is subject to a substantial risk of forfeiture. 1040nr 2012 The examples assume that the NQDC plan is in compliance with section 409A, and that amounts deferred under the plan are not includible in gross income as they are deferred. 1040nr 2012 For purposes of the examples, it is assumed that the regular pay of the employee is remuneration for employment and wages for employment tax purposes except to the extent the deferral of a portion of the regular pay results in a reduction in wages. 1040nr 2012 Example 1: Deferral that is immediately vested (no substantial risk of forfeiture) with no distributions and no vesting of prior-year deferrals. 1040nr 2012 For the year, the employee’s regular pay was $200, and the employee deferred $20 of the pay into her employer’s NQDC plan. 1040nr 2012 The deferral of $20 was vested upon deferral and there was an employer match of $10 under the plan, which was also vested. 1040nr 2012 Regular pay = $200; Deferral, vested = $20; Employer match, vested = $10. 1040nr 2012 Form W-2 Completion Amount Box 1 ($200 Regular pay minus $20 vested deferral) $180 Box 3 ($200 Regular pay plus $10 Employer match, vested) 210 Box 5 ($200 Regular pay plus $10 Employer match, vested) 210 Box 11 -0- Example 2: Deferral with delayed vesting (substantial risk of forfeiture) of employee and employer portions (no distributions and no vesting of prior-year deferrals). 1040nr 2012 For the year, the employee’s regular pay was $200, and the employee deferred $20 of the pay into the employer’s nonqualified deferred compensation plan. 1040nr 2012 The deferral of $20 was not vested upon deferral, and there was an employer match of $10 under the plan, which was also not vested. 1040nr 2012 Regular pay = $200; Deferral, not vested = $20; Employer match, not vested = $10. 1040nr 2012 Form W-2 Completion Amount Box 1 ($200 Regular pay minus $20 Deferral, not vested) $180 Box 3 ($200 Regular pay minus $20 Deferral, not vested) 180 Box 5 ($200 Regular pay minus $20 Deferral, not vested) 180 Box 11 -0- Example 3: Deferral that is immediately vested with prior-year deferrals and investment earnings on the prior-year deferrals that are now vesting (no distributions). 1040nr 2012 For the year, the employee’s regular pay was $200, and the employee deferred $20 of the pay into the employer’s nonqualified deferred compensation plan. 1040nr 2012 The deferral of $20 was vested upon deferral. 1040nr 2012 During the year, $100 of prior-year deferrals and $15 of investment earnings on the $100 of prior-year deferrals became vested. 1040nr 2012 Regular pay = $200; Deferral, vested = $20; Vesting of prior-year deferrals = $100; Vesting of investment earnings on $100 of prior-year deferral = $15. 1040nr 2012 Form W-2 Completion Amount Box 1 ($200 Regular pay minus $20 Deferral, vested) $180 Box 3 ($200 Regular pay plus $100 vested prior-year deferral plus $15 earnings on deferral) 315 Box 5 ($200 Regular pay plus $100 vested prior-year deferral plus $15 vested investment earnings on prior year deferral) 315 Box 11 ($100 vested prior-year deferral plus $15 earnings) 115 Example 4: No deferrals but there are distributions (no vesting of prior-year deferrals). 1040nr 2012 For the year, the employee’s regular pay was $100, and the employee deferred no pay into the employer’s NQDC plan. 1040nr 2012 There was no vesting of prior-year deferrals under the plan. 1040nr 2012 During the year, there were total distributions of $50 from the plan to the employee. 1040nr 2012 Regular pay = $100; Distribution = $50. 1040nr 2012 Form W-2 Completion Amount Box 1 ($100 Regular pay plus $50 Distribution) $150 Box 3 ($100 Regular pay ) 100 Box 5 ($100 Regular pay) 100 Box 11 ($50 Distribution) 50 Special rule for box 11 of Form W-2 (distributions and deferral in the same year). 1040nr 2012   If, in the same year, there are NQDC distributions and there are deferrals that are reportable in boxes 3 and/or 5 (current or prior-year deferrals) of Form W-2, do not complete box 11. 1040nr 2012 Instead, report on Form SSA-131 the total amount the employee earned during the year. 1040nr 2012 * Submit the SSA-131 to the nearest SSA office or give it to the employee. 1040nr 2012   *Generally, the amount earned by the employee during the tax year for purposes of item 6 of Form SSA-131 is the amount reported in box 1 of Form W-2 plus current-year deferrals that are vested (employee and employer portions) less distributions. 1040nr 2012 Do not consider prior-year deferrals that are vesting in the current year. 1040nr 2012 If there was a plan failure, the box 1 amount in this calculation should be as if there were no plan failure. 1040nr 2012 Example 5: Deferral that is immediately vested and there are distributions (no vesting of prior-year deferrals). 1040nr 2012 For the year, the employee’s regular pay was $200, and the employee deferred $20 of the pay into the employer’s NQDC plan. 1040nr 2012 There was also an employer match of $10. 1040nr 2012 The deferral and employer match were vested upon deferral. 1040nr 2012 There was no vesting of prior-year deferrals under the plan. 1040nr 2012 During the year, there were total distributions of $50 from the plan to the employee. 1040nr 2012 Regular pay = $200; Deferral, vested = $20; Employer match, vested = $10; Distribution = $50. 1040nr 2012 Form W-2 Completion Amount Box 1 ($50 Special Wage Payment (Distribution) plus $200 Regular pay minus $20 Deferral, vested) $230 Boxes 3 and 5 ($200 Regular pay plus $10 vested employer match) 210 Leave Box 11 blank. 1040nr 2012 File Form SSA-131 -0-     Form SSA-131 Completion Item 6 - amount of wages earned by the employee during the tax year ($230 from Box 1 of Form W-2 minus $50 Distribution plus $30 vested current year employee deferral and employer match) $210 Example 6: Deferral with delayed vesting and there are distributions (no vesting of prior-year deferrals). 1040nr 2012 For the year, the employee’s regular pay was $200, and the employee deferred $20 of the pay into the employer’s NQDC plan. 1040nr 2012 The deferral was not vested upon deferral. 1040nr 2012 There was no vesting of prior-year deferrals under the plan. 1040nr 2012 During the year, there were total distributions of $50 from the plan to the employee. 1040nr 2012 Regular pay = $200; Deferral, not vested = $20; Distribution = $50. 1040nr 2012 Form W-2 Completion Amount Box 1 ($50 Special Wage Payment (Distribution) plus $200 Regular pay minus $20 Deferral, not vested) $230 Boxes 3 and 5 ($200 Regular pay minus $20 deferral that is not vested) 180 Box 11 ($50 Distribution). 1040nr 2012 50 Example 7: Deferral that is immediately vested and there are distributions (also vesting of prior-year deferrals and earnings on those prior-year deferrals). 1040nr 2012 For the year, the employee’s regular pay was $200, and the employee deferred $20 of the pay into the employer’s NQDC plan. 1040nr 2012 The deferral was vested upon deferral. 1040nr 2012 There was vesting of $100 of prior-year deferrals and $15 of earnings on the $100 prior-year deferral under the plan. 1040nr 2012 During the year, there were total distributions of $50 from the plan to the employee. 1040nr 2012 Regular pay = $200; Deferral, vested = $20; Distribution = $50; Vesting of prior-year deferrals ($100) and earnings on those prior-year deferrals ($15) = $115. 1040nr 2012 Form W-2 Completion Amount Box 1 ($50 Special Wage Payment (Distribution) plus $200 Regular pay minus $20 vested deferral $230 Boxes 3 and 5 ($200 Regular pay Plus $115 vested prior deferral (with vested earnings on the deferral)) 315 Leave Box 11 blank. 1040nr 2012 File Form SSA-131 -0-     Form SSA-131 Completion Item 6, amount of wages earned by the employee during the tax year ($230 from Box 1 of Form W-2 minus $50 Distribution plus $20 vested current year deferral) $200 Example 8: Deferral with delayed vesting and there are distributions (vesting of prior-year deferrals, including employer matches, and earnings on those deferrals). 1040nr 2012 For the year, the employee’s regular pay was $200, and the employee deferred $20 of the pay into the employer’s NQDC plan. 1040nr 2012 The deferral was not vested upon deferral. 1040nr 2012 There was also vesting of prior-year deferrals and employer matches and earnings on these amounts under the plan ($115). 1040nr 2012 During the year, there were total distributions of $50 from the plan to the employee. 1040nr 2012 Regular pay = $200; Deferral, not vested = $20; Distribution = $50; Vesting of prior-year deferrals and employer match = $100 plus earnings on that $100 of $15. 1040nr 2012 Form W-2 Completion Amount Box 1 ($50 Special Wage Payment (Distribution) plus $200 regular pay minus $20 Deferral, not vested) $230 Boxes 3 and 5 ($200 Regular pay plus $115 vested prior-year deferral and prior year employer match and earning on the prior year amounts minus $20 deferral that is not vested) 295 Leave Box 11 blank. 1040nr 2012 File Form SSA-131 -0-     Form SSA-131 Completion Item 6 ($230 Amount from Box 1 of Form W-2 minus $50 Distribution) $180 Table 2. 1040nr 2012 Specifications for Electronic Reporting of Special Wage Payments Record Position  Field Size   Description Start End 1 3 3 Record Type—must include only the capital letters “SWP” 4 12 9 SSN—must be numeric and may not be all zeros 13 27 15 Last Name—all capitals and no punctuation; may have blanks on right only 28 38 11 First Name—all capitals and no punctuation; may have blanks on right only 39 39 1 Middle Initial—must be either a capital letter or blank 40 48 9 EIN—must be numeric and may not be all zeros 49 59 11 Payment—must be numeric; may not be all zeros; last two digits on right are assumed to be cents; no period or dollar sign 60 63 4 Payment Year—must be only a four-digit year 64 66 3 SSA Office Code—must be numeric and may be all zeros 67 67 1 Payment Type Code—must be the capital letter “T” 68 117 50 Filler  The record format is a fixed length of 117. 1040nr 2012  The file format is ASCII. 1040nr 2012  Submit only one file at a time. 1040nr 2012   Table 3. 1040nr 2012 Sample—Paper Listing for Reporting Special Wage Payments to Several Employees Report of Special Wage PaymentsTax Year: Page of A. 1040nr 2012 Employer Name: EIN:   Address: Contact Name:     Phone: ( )   . 1040nr 2012 1) B. 1040nr 2012 Employee Name: (Last) (First) (MI)   C. 1040nr 2012 SSN: D. 1040nr 2012 SWP:$ E. 1040nr 2012 Type: Other: 2) B. 1040nr 2012 Employee Name: (Last) (First) (MI)   C. 1040nr 2012 SSN: D. 1040nr 2012 SWP:$ E. 1040nr 2012 Type: Other: 3) B. 1040nr 2012 Employee Name: (Last) (First) (MI)   C. 1040nr 2012 SSN: D. 1040nr 2012 SWP:$ E. 1040nr 2012 Type: Other: 4) B. 1040nr 2012 Employee Name: (Last) (First) (MI)   C. 1040nr 2012 SSN: D. 1040nr 2012 SWP:$ E. 1040nr 2012 Type: Other: 5) B. 1040nr 2012 Employee Name: (Last) (First) (MI)   C. 1040nr 2012 SSN: D. 1040nr 2012 SWP:$ E. 1040nr 2012 Type: Other:     INSTRUCTIONS:   Enter tax year and page number. 1040nr 2012   A. 1040nr 2012 Employer name, employer identification number (EIN), address, the name of a contact person, and a phone number where the contact person can be reached during normal business hours. 1040nr 2012   B. 1040nr 2012 Employee's name. 1040nr 2012   C. 1040nr 2012 Employee's social security number (SSN). 1040nr 2012   D. 1040nr 2012 Total amount of special wage payments made to the employee. 1040nr 2012   E. 1040nr 2012 Type of special wage payment from the following list: (1) Vacation Pay, (2) Sick Pay, (3) Severance Pay,  (4) Bonus, (5) Deferred Compensation, (6) Stock Options, and (7) Other—Please explain. 1040nr 2012   Do not use a paper listing for nonqualified deferred compensation and section 457 plan deferrals and payments that could not be reported in block 11 of Form W-2. 1040nr 2012 (Get Form SSA-131. 1040nr 2012 )                 Prev  Up  Next   Home   More Online Publications
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The 1040nr 2012

1040nr 2012 Publication 505 - Introductory Material Table of Contents IntroductionNonresident aliens. 1040nr 2012 Ordering forms and publications. 1040nr 2012 Tax questions. 1040nr 2012 What's New for 2014 Reminders Introduction The federal income tax is a pay-as-you-go tax. 1040nr 2012 You must pay the tax as you earn or receive income during the year. 1040nr 2012 There are two ways to pay as you go. 1040nr 2012 Withholding. 1040nr 2012 If you are an employee, your employer probably withholds income tax from your pay. 1040nr 2012 In addition, tax may be withheld from certain other income, such as pensions, bonuses, commissions, and gambling winnings. 1040nr 2012 The amount withheld is paid to the Internal Revenue Service (IRS) in your name. 1040nr 2012 Estimated tax. 1040nr 2012 If you do not pay your tax through withholding, or do not pay enough tax that way, you might have to pay estimated tax. 1040nr 2012 People who are in business for themselves generally will have to pay their tax this way. 1040nr 2012 You may have to pay estimated tax if you receive income such as dividends, interest, capital gains, rents, and royalties. 1040nr 2012 Estimated tax is used to pay not only income tax, but other taxes such as self-employment tax and alternative minimum tax. 1040nr 2012 This publication explains both of these methods. 1040nr 2012 It also explains how to take credit on your return for the tax that was withheld and for your estimated tax payments. 1040nr 2012 If you did not pay enough tax during the year, either through withholding or by making estimated tax payments, you may have to pay a penalty. 1040nr 2012 Generally, the IRS can figure this penalty for you. 1040nr 2012 This underpayment penalty, and the exceptions to it, are discussed in chapter 4. 1040nr 2012 Nonresident aliens. 1040nr 2012    Before completing Form W-4, nonresident alien employees should see the Instructions for Form 8233, Exemption From Withholding on Compensation for Independent (and Certain Dependent) Personal Services of a Nonresident Alien Individual. 1040nr 2012 Also see chapter 8 of Publication 519, U. 1040nr 2012 S. 1040nr 2012 Tax Guide for Aliens, for important information on withholding. 1040nr 2012 What's new for 2013 and 2014. 1040nr 2012   See What's New for 2014 in this Introduction, and What's New for 2013 in chapter 4. 1040nr 2012 Comments and suggestions. 1040nr 2012   We welcome your comments about this publication and your suggestions for future editions. 1040nr 2012   You can write to us at the following address: Internal Revenue Service Tax Forms and Publications Division 1111 Constitution Ave. 1040nr 2012 NW, IR-6526 Washington, DC 20224   We respond to many letters by telephone. 1040nr 2012 Therefore, it would be helpful if you would include your daytime phone number, including the area code, in your correspondence. 1040nr 2012   You can send your comments from www. 1040nr 2012 irs. 1040nr 2012 gov/formspubs/. 1040nr 2012 Click on “More Information” and then on Give us feedback on forms and publications. 1040nr 2012   Although we cannot respond individually to each comment received, we do appreciate your feedback and will consider your comments as we revise our tax products. 1040nr 2012 Ordering forms and publications. 1040nr 2012   Visit www. 1040nr 2012 irs. 1040nr 2012 gov/formspubs/ to download forms and publications, call 1-800-TAX-FORM (1-800-829-3676), or write to the address below and receive a response within 10 business days after your request is received. 1040nr 2012 Internal Revenue Service 1201 N. 1040nr 2012 Mitsubishi Motorway Bloomington, IL 61705-6613 Tax questions. 1040nr 2012   If you have a tax question, check the information available on IRS. 1040nr 2012 gov or call 1-800-829-1040. 1040nr 2012 We cannot answer tax questions sent to either of the above addresses. 1040nr 2012 What's New for 2014 Use your 2013 tax return as a guide in figuring your 2014 estimated tax, but be sure to consider the following. 1040nr 2012 Standard mileage rates. 1040nr 2012  The 2014 rate for business use of your vehicle is 56 cents per mile. 1040nr 2012 The rate for use of your vehicle to get medical care or move is 23½ cents per mile. 1040nr 2012 The rate of 14 cents per mile for charitable use is unchanged. 1040nr 2012 Personal exemption increased for certain taxpayers. 1040nr 2012  For 2014, the personal exemption amount is increased to $3,950 for taxpayers with adjusted gross income at or below $305,050 if married filing jointly or qualifying widow(er), $279,650 if head of household, $254,200 if single, or $152,525 if married filing separately. 1040nr 2012 The personal exemption amount for taxpayers with adjusted gross income above these thresholds may be reduced. 1040nr 2012 Limitation on itemized deductions. 1040nr 2012  For 2014, itemized deductions for taxpayers with adjusted gross income above $305,050 if married filing jointly or qualifying widow(er), $279,650 if head of household, $254,200 if single, and $152,525 if married filing separately may be reduced. 1040nr 2012 Health care coverage. 1040nr 2012  When you file your 2014 tax return in 2015, you will need to either (1) indicate on your return that you and your family had health care coverage throughout 2014, (2) claim an exemption from the health care coverage requirement for some or all of 2014, or (3) make a payment if you do not have coverage or an exemption(s) for all 12 months of 2014. 1040nr 2012 For examples on how this payment works, go to www. 1040nr 2012 IRS. 1040nr 2012 gov/aca and click under the “Individuals & Families” section. 1040nr 2012 You may want to consider this when figuring your “Other taxes” on Line 12 of the 2014 Estimated Tax Worksheet (Worksheet 2-1). 1040nr 2012 For general information on these requirements, go to www. 1040nr 2012 IRS. 1040nr 2012 gov/aca. 1040nr 2012 Advance payments of the Premium Tax Credit. 1040nr 2012  If you buy health care insurance through the Health Insurance Marketplace, you may be eligible for advance payments of the Premium Tax Credit to help pay for your insurance coverage. 1040nr 2012 Receiving too little or too much in advance will affect your refund or balance due. 1040nr 2012 Promptly report changes in your income or family size to your Marketplace. 1040nr 2012 You may want to consider this when figuring your estimated taxes for 2014. 1040nr 2012 For more information, go to www. 1040nr 2012 IRS. 1040nr 2012 gov/aca and see Publication 5120 and Publication 5121. 1040nr 2012 http://www. 1040nr 2012 IRS. 1040nr 2012 gov/pub5120 Alternative minimum tax (AMT) exemption amount increased. 1040nr 2012  The AMT exemption amount is increased to $52,800 ($82,100 if married filing jointly or qualifying widow(er); $41,050 if married filing separately). 1040nr 2012 Lifetime learning credit income limits. 1040nr 2012  In order to claim a lifetime learning credit, your MAGI must be less than $54,000 ($108,000 if married filing jointly). 1040nr 2012 Retirement savings contribution credit income limits increased. 1040nr 2012  In order to claim this credit for 2014, your MAGI must be less than $30,000 ($60,000 if married filing jointly; $45,000 if head of household). 1040nr 2012 Adoption credit or exclusion. 1040nr 2012  The maximum adoption credit or exclusion for employer-provided adoption benefits has increased to $13,190. 1040nr 2012 In order to claim either the credit or exclusion, your MAGI must be less than $237,880. 1040nr 2012 Earned income credit (EIC). 1040nr 2012  You may be able to take the EIC in 2014 if: Three or more children lived with you and you earned less than $46,997 ($52,427 if married filing jointly), Two children lived with you and you earned less than $43,756 ($49,186 if married filing jointly), One child lived with you and you earned less than $38,511 ($43,941 if married filing jointly), or A child did not live with you and you earned less than $14,590 ($20,020 if married filing jointly). 1040nr 2012 Also, the maximum MAGI you can have and still get the credit has increased. 1040nr 2012 You may be able to take the credit if your MAGI is less than the amount in the above list that applies to you. 1040nr 2012 The maximum investment income you can have and get the credit has increased to $3,350. 1040nr 2012 Reminders Future developments. 1040nr 2012  The IRS has created a page on IRS. 1040nr 2012 gov for information about Publication 505 at www. 1040nr 2012 irs. 1040nr 2012 gov/pub505. 1040nr 2012 Information about any future developments affecting Publication 505 (such as legislation enacted after we release it) will be posted on that page. 1040nr 2012 Social security tax. 1040nr 2012   Generally, each employer for whom you work during the tax year must withhold social security tax up to the annual limit. 1040nr 2012 The annual limit is $117,000 in 2014. 1040nr 2012 Photographs of missing children. 1040nr 2012  The Internal Revenue Service is a proud partner with the National Center for Missing and Exploited Children. 1040nr 2012 Photographs of missing children selected by the Center may appear in this publication on pages that otherwise would be blank. 1040nr 2012 You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child. 1040nr 2012 Additional Medicare Tax. 1040nr 2012  Beginning in 2013, a 0. 1040nr 2012 9% Additional Medicare Tax applies to Medicare wages, Railroad Retirement Tax Act compensation, and self-employment income over a threshold amount based on your filing status. 1040nr 2012 You may need to include this amount when figuring your estimated tax. 1040nr 2012 See the instructions for line 12 of the 2014 Estimated Tax Worksheet. 1040nr 2012 You may also request that your employer deduct and withhold an additional amount of income tax withholding from your wages on Form W-4, Employee's Withholding Allowance Certificate. 1040nr 2012 For more information on Additional Medicare Tax, go to IRS. 1040nr 2012 gov and enter “Additional Medicare Tax” in the search box. 1040nr 2012 Net Investment Income Tax. 1040nr 2012  Beginning in 2013, you may be subject to Net Investment Income Tax (NIIT). 1040nr 2012 NIIT is a 3. 1040nr 2012 8% tax on the lesser of net investment income or the excess of your modified adjusted gross income (MAGI) over the threshold amount. 1040nr 2012 NIIT may need to be included when figuring estimated tax. 1040nr 2012 See the instructions for line 12 of the 2014 Estimated Tax Worksheet. 1040nr 2012 You may also request that your employer deduct and withhold an additional amount of income tax withholding from your wages on Form W-4. 1040nr 2012 For more information on NIIT, go to IRS. 1040nr 2012 gov and enter “Net Investment Income Tax” in the search box. 1040nr 2012 Prev  Up  Next   Home   More Online Publications