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2011 Income Tax

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2011 Income Tax

2011 income tax 4. 2011 income tax   Tax Withholding and Estimated Tax Table of Contents What's New for 2014 Reminders Introduction Useful Items - You may want to see: Tax Withholding for 2014Salaries and Wages Tips Taxable Fringe Benefits Sick Pay Pensions and Annuities Gambling Winnings Unemployment Compensation Federal Payments Backup Withholding Estimated Tax for 2014Who Does Not Have To Pay Estimated Tax Who Must Pay Estimated Tax How To Figure Estimated Tax When To Pay Estimated Tax How To Figure Each Payment How To Pay Estimated Tax Credit for Withholding and Estimated Tax for 2013Withholding Estimated Tax Underpayment Penalty for 2013 What's New for 2014 Tax law changes for 2014. 2011 income tax  When you figure how much income tax you want withheld from your pay and when you figure your estimated tax, consider tax law changes effective in 2014. 2011 income tax For more information, see Publication 505. 2011 income tax Reminders Estimated tax safe harbor for higher income taxpayers. 2011 income tax  If your 2013 adjusted gross income was more than $150,000 ($75,000 if you are married filing a separate return), you must pay the smaller of 90% of your expected tax for 2014 or 110% of the tax shown on your 2013 return to avoid an estimated tax penalty. 2011 income tax Introduction This chapter discusses how to pay your tax as you earn or receive income during the year. 2011 income tax In general, the federal income tax is a pay-as-you-go tax. 2011 income tax There are two ways to pay as you go. 2011 income tax Withholding. 2011 income tax If you are an employee, your employer probably withholds income tax from your pay. 2011 income tax Tax also may be withheld from certain other income, such as pensions, bonuses, commissions, and gambling winnings. 2011 income tax The amount withheld is paid to the IRS in your name. 2011 income tax Estimated tax. 2011 income tax If you do not pay your tax through withholding, or do not pay enough tax that way, you may have to pay estimated tax. 2011 income tax People who are in business for themselves generally will have to pay their tax this way. 2011 income tax Also, you may have to pay estimated tax if you receive income such as dividends, interest, capital gains, rent, and royalties. 2011 income tax Estimated tax is used to pay not only income tax, but self-employment tax and alternative minimum tax as well. 2011 income tax This chapter explains these methods. 2011 income tax In addition, it also explains the following. 2011 income tax Credit for withholding and estimated tax. 2011 income tax When you file your 2013 income tax return, take credit for all the income tax withheld from your salary, wages, pensions, etc. 2011 income tax , and for the estimated tax you paid for 2013. 2011 income tax Also take credit for any excess social security or railroad retirement tax withheld (discussed in chapter 37). 2011 income tax Underpayment penalty. 2011 income tax 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. 2011 income tax In most cases, the IRS can figure this penalty for you. 2011 income tax See Underpayment Penalty for 2013 at the end of this chapter. 2011 income tax Useful Items - You may want to see: Publication 505 Tax Withholding and Estimated Tax Form (and Instructions) W-4 Employee's Withholding Allowance Certificate W-4P Withholding Certificate for Pension or Annuity Payments W-4S Request for Federal Income Tax Withholding From Sick Pay W-4V Voluntary Withholding Request 1040-ES Estimated Tax for Individuals 2210 Underpayment of Estimated Tax by Individuals, Estates, and Trusts 2210-F Underpayment of Estimated Tax by Farmers and Fishermen Tax Withholding for 2014 This section discusses income tax withholding on: Salaries and wages, Tips, Taxable fringe benefits, Sick pay, Pensions and annuities, Gambling winnings, Unemployment compensation, and Certain federal payments. 2011 income tax This section explains the rules for withholding tax from each of these types of income. 2011 income tax This section also covers backup withholding on interest, dividends, and other payments. 2011 income tax Salaries and Wages Income tax is withheld from the pay of most employees. 2011 income tax Your pay includes your regular pay, bonuses, commissions, and vacation allowances. 2011 income tax It also includes reimbursements and other expense allowances paid under a nonaccountable plan. 2011 income tax See Supplemental Wages , later, for more information about reimbursements and allowances paid under a nonaccountable plan. 2011 income tax If your income is low enough that you will not have to pay income tax for the year, you may be exempt from withholding. 2011 income tax This is explained under Exemption From Withholding , later. 2011 income tax You can ask your employer to withhold income tax from noncash wages and other wages not subject to withholding. 2011 income tax If your employer does not agree to withhold tax, or if not enough is withheld, you may have to pay estimated tax, as discussed later under Estimated Tax for 2014 . 2011 income tax Military retirees. 2011 income tax   Military retirement pay is treated in the same manner as regular pay for income tax withholding purposes, even though it is treated as a pension or annuity for other tax purposes. 2011 income tax Household workers. 2011 income tax   If you are a household worker, you can ask your employer to withhold income tax from your pay. 2011 income tax A household worker is an employee who performs household work in a private home, local college club, or local fraternity or sorority chapter. 2011 income tax   Tax is withheld only if you want it withheld and your employer agrees to withhold it. 2011 income tax If you do not have enough income tax withheld, you may have to pay estimated tax, as discussed later under Estimated Tax for 2014 . 2011 income tax Farmworkers. 2011 income tax   Generally, income tax is withheld from your cash wages for work on a farm unless your employer does both of these: Pays you cash wages of less than $150 during the year, and Has expenditures for agricultural labor totaling less than $2,500 during the year. 2011 income tax Differential wage payments. 2011 income tax    When employees are on leave from employment for military duty, some employers make up the difference between the military pay and civilian pay. 2011 income tax Payments to an employee who is on active duty for a period of more than 30 days will be subject to income tax withholding, but not subject to social security or Medicare taxes. 2011 income tax The wages and withholding will be reported on Form W-2, Wage and Tax Statement. 2011 income tax   The credit employers can claim for differential wages paid to activated military reservists is scheduled to expire for wages paid after December 31, 2013. 2011 income tax Determining Amount of Tax Withheld Using Form W-4 The amount of income tax your employer withholds from your regular pay depends on two things. 2011 income tax The amount you earn in each payroll period. 2011 income tax The information you give your employer on Form W-4. 2011 income tax Form W-4 includes four types of information that your employer will use to figure your withholding. 2011 income tax Whether to withhold at the single rate or at the lower married rate. 2011 income tax How many withholding allowances you claim (each allowance reduces the amount withheld). 2011 income tax Whether you want an additional amount withheld. 2011 income tax Whether you are claiming an exemption from withholding in 2014. 2011 income tax See Exemption From Withholding , later. 2011 income tax Note. 2011 income tax You must specify a filing status and a number of withholding allowances on Form W-4. 2011 income tax You cannot specify only a dollar amount of withholding. 2011 income tax New Job When you start a new job, you must fill out Form W-4 and give it to your employer. 2011 income tax Your employer should have copies of the form. 2011 income tax If you need to change the information later, you must fill out a new form. 2011 income tax If you work only part of the year (for example, you start working after the beginning of the year), too much tax may be withheld. 2011 income tax You may be able to avoid overwithholding if your employer agrees to use the part-year method. 2011 income tax See Part-Year Method in chapter 1 of Publication 505 for more information. 2011 income tax Employee also receiving pension income. 2011 income tax   If you receive pension or annuity income and begin a new job, you will need to file Form W-4 with your new employer. 2011 income tax However, you can choose to split your withholding allowances between your pension and job in any manner. 2011 income tax Changing Your Withholding During the year changes may occur to your marital status, exemptions, adjustments, deductions, or credits you expect to claim on your tax return. 2011 income tax When this happens, you may need to give your employer a new Form W-4 to change your withholding status or your number of allowances. 2011 income tax If the changes reduce the number of allowances you are claiming or changes your marital status from married to single, you must give your employer a new Form W-4 within 10 days. 2011 income tax Generally, you can submit a new Form W-4 whenever you wish to change the number of your withholding allowances for any other reason. 2011 income tax Changing your withholding for 2015. 2011 income tax   If events in 2014 will decrease the number of your withholding allowances for 2015, you must give your employer a new Form W-4 by December 1, 2014. 2011 income tax If the event occurs in December 2014, submit a new Form W-4 within 10 days. 2011 income tax Checking Your Withholding After you have given your employer a Form W-4, you can check to see whether the amount of tax withheld from your pay is too little or too much. 2011 income tax If too much or too little tax is being withheld, you should give your employer a new Form W-4 to change your withholding. 2011 income tax You should try to have your withholding match your actual tax liability. 2011 income tax If not enough tax is withheld, you will owe tax at the end of the year and may have to pay interest and a penalty. 2011 income tax If too much tax is withheld, you will lose the use of that money until you get your refund. 2011 income tax Always check your withholding if there are personal or financial changes in your life or changes in the law that might change your tax liability. 2011 income tax Note. 2011 income tax You cannot give your employer a payment to cover withholding on salaries and wages for past pay periods or a payment for estimated tax. 2011 income tax Completing Form W-4 and Worksheets Form W-4 has worksheets to help you figure how many withholding allowances you can claim. 2011 income tax The worksheets are for your own records. 2011 income tax Do not give them to your employer. 2011 income tax Multiple jobs. 2011 income tax   If you have income from more than one job at the same time, complete only one set of Form W-4 worksheets. 2011 income tax Then split your allowances between the Forms W-4 for each job. 2011 income tax You cannot claim the same allowances with more than one employer at the same time. 2011 income tax You can claim all your allowances with one employer and none with the other(s), or divide them any other way. 2011 income tax Married individuals. 2011 income tax   If both you and your spouse are employed and expect to file a joint return, figure your withholding allowances using your combined income, adjustments, deductions, exemptions, and credits. 2011 income tax Use only one set of worksheets. 2011 income tax You can divide your total allowances any way, but you cannot claim an allowance that your spouse also claims. 2011 income tax   If you and your spouse expect to file separate returns, figure your allowances using separate worksheets based on your own individual income, adjustments, deductions, exemptions, and credits. 2011 income tax Alternative method of figuring withholding allowances. 2011 income tax   You do not have to use the Form W-4 worksheets if you use a more accurate method of figuring the number of withholding allowances. 2011 income tax For more information, see Alternative method of figuring withholding allowances under Completing Form W-4 and Worksheets in Publication 505, chapter 1. 2011 income tax Personal Allowances Worksheet. 2011 income tax   Use the Personal Allowances Worksheet on Form W-4 to figure your withholding allowances based on exemptions and any special allowances that apply. 2011 income tax Deduction and Adjustments Worksheet. 2011 income tax   Use the Deduction and Adjustments Worksheet on Form W-4 if you plan to itemize your deductions, claim certain credits, or claim adjustments to the income on your 2014 tax return and you want to reduce your withholding. 2011 income tax Also, complete this worksheet when you have changes to these items to see if you need to change your withholding. 2011 income tax Two-Earners/Multiple Jobs Worksheet. 2011 income tax   You may need to complete the Two-Earners/Multiple Jobs Worksheet on Form W-4 if you have more than one job, a working spouse, or are also receiving a pension. 2011 income tax Also, on this worksheet you can add any additional withholding necessary to cover any amount you expect to owe other than income tax, such as self-employment tax. 2011 income tax Getting the Right Amount of Tax Withheld In most situations, the tax withheld from your pay will be close to the tax you figure on your return if you follow these two rules. 2011 income tax You accurately complete all the Form W-4 worksheets that apply to you. 2011 income tax You give your employer a new Form W-4 when changes occur. 2011 income tax But because the worksheets and withholding methods do not account for all possible situations, you may not be getting the right amount withheld. 2011 income tax This is most likely to happen in the following situations. 2011 income tax You are married and both you and your spouse work. 2011 income tax You have more than one job at a time. 2011 income tax You have nonwage income, such as interest, dividends, alimony, unemployment compensation, or self-employment income. 2011 income tax You will owe additional amounts with your return, such as self-employment tax. 2011 income tax Your withholding is based on obsolete Form W-4 information for a substantial part of the year. 2011 income tax Your earnings are more than the amount shown under Check your withholding in the instructions at the top of page 1 of Form W-4. 2011 income tax You work only part of the year. 2011 income tax You change the number of your withholding allowances during the year. 2011 income tax Cumulative wage method. 2011 income tax   If you change the number of your withholding allowances during the year, too much or too little tax may have been withheld for the period before you made the change. 2011 income tax You may be able to compensate for this if your employer agrees to use the cumulative wage withholding method for the rest of the year. 2011 income tax You must ask your employer in writing to use this method. 2011 income tax   To be eligible, you must have been paid for the same kind of payroll period (weekly, biweekly, etc. 2011 income tax ) since the beginning of the year. 2011 income tax Publication 505 To make sure you are getting the right amount of tax withheld, get Publication 505. 2011 income tax It will help you compare the total tax to be withheld during the year with the tax you can expect to figure on your return. 2011 income tax It also will help you determine how much, if any, additional withholding is needed each payday to avoid owing tax when you file your return. 2011 income tax If you do not have enough tax withheld, you may have to pay estimated tax, as explained under Estimated Tax for 2014 , later. 2011 income tax You can use the IRS Withholding Calculator at www. 2011 income tax irs. 2011 income tax gov/Individuals, instead of Publication 505 or the worksheets included with Form W-4, to determine whether you need to have your withholding increased or decreased. 2011 income tax Rules Your Employer Must Follow It may be helpful for you to know some of the withholding rules your employer must follow. 2011 income tax These rules can affect how to fill out your Form W-4 and how to handle problems that may arise. 2011 income tax New Form W-4. 2011 income tax   When you start a new job, your employer should have you complete a Form W-4. 2011 income tax Beginning with your first payday, your employer will use the information you give on the form to figure your withholding. 2011 income tax   If you later fill out a new Form W-4, your employer can put it into effect as soon as possible. 2011 income tax The deadline for putting it into effect is the start of the first payroll period ending 30 or more days after you turn it in. 2011 income tax No Form W-4. 2011 income tax   If you do not give your employer a completed Form W-4, your employer must withhold at the highest rate, as if you were single and claimed no withholding allowances. 2011 income tax Repaying withheld tax. 2011 income tax   If you find you are having too much tax withheld because you did not claim all the withholding allowances you are entitled to, you should give your employer a new Form W-4. 2011 income tax Your employer cannot repay any of the tax previously withheld. 2011 income tax Instead, claim the full amount withheld when you file your tax return. 2011 income tax   However, if your employer has withheld more than the correct amount of tax for the Form W-4 you have in effect, you do not have to fill out a new Form W-4 to have your withholding lowered to the correct amount. 2011 income tax Your employer can repay the amount that was withheld incorrectly. 2011 income tax If you are not repaid, your Form W-2 will reflect the full amount actually withheld, which you would claim when you file your tax return. 2011 income tax Exemption From Withholding If you claim exemption from withholding, your employer will not withhold federal income tax from your wages. 2011 income tax The exemption applies only to income tax, not to social security or Medicare tax. 2011 income tax You can claim exemption from withholding for 2014 only if both of the following situations apply. 2011 income tax For 2013 you had a right to a refund of all federal income tax withheld because you had no tax liability. 2011 income tax For 2014 you expect a refund of all federal income tax withheld because you expect to have no tax liability. 2011 income tax Students. 2011 income tax   If you are a student, you are not automatically exempt. 2011 income tax See chapter 1 to find out if you must file a return. 2011 income tax If you work only part time or only during the summer, you may qualify for exemption from withholding. 2011 income tax Age 65 or older or blind. 2011 income tax   If you are 65 or older or blind, use Worksheet 1-3 or 1-4 in chapter 1 of Publication 505, to help you decide if you qualify for exemption from withholding. 2011 income tax Do not use either worksheet if you will itemize deductions, claim exemptions for dependents, or claim tax credits on your 2014 return. 2011 income tax Instead, see Itemizing deductions or claiming exemptions or credits in chapter 1 of Publication 505. 2011 income tax Claiming exemption from withholding. 2011 income tax   To claim exemption, you must give your employer a Form W-4. 2011 income tax Do not complete lines 5 and 6. 2011 income tax Enter “Exempt” on line 7. 2011 income tax   If you claim exemption, but later your situation changes so that you will have to pay income tax after all, you must file a new Form W-4 within 10 days after the change. 2011 income tax If you claim exemption in 2014, but you expect to owe income tax for 2015, you must file a new Form W-4 by December 1, 2014. 2011 income tax   Your claim of exempt status may be reviewed by the IRS. 2011 income tax An exemption is good for only 1 year. 2011 income tax   You must give your employer a new Form W-4 by February 15 each year to continue your exemption. 2011 income tax Supplemental Wages Supplemental wages include bonuses, commissions, overtime pay, vacation allowances, certain sick pay, and expense allowances under certain plans. 2011 income tax The payer can figure withholding on supplemental wages using the same method used for your regular wages. 2011 income tax However, if these payments are identified separately from your regular wages, your employer or other payer of supplemental wages can withhold income tax from these wages at a flat rate. 2011 income tax Expense allowances. 2011 income tax   Reimbursements or other expense allowances paid by your employer under a nonaccountable plan are treated as supplemental wages. 2011 income tax   Reimbursements or other expense allowances paid under an accountable plan that are more than your proven expenses are treated as paid under a nonaccountable plan if you do not return the excess payments within a reasonable period of time. 2011 income tax   For more information about accountable and nonaccountable expense allowance plans, see Reimbursements in chapter 26. 2011 income tax Penalties You may have to pay a penalty of $500 if both of the following apply. 2011 income tax You make statements or claim withholding allowances on your Form W-4 that reduce the amount of tax withheld. 2011 income tax You have no reasonable basis for those statements or allowances at the time you prepare your Form W-4. 2011 income tax There is also a criminal penalty for willfully supplying false or fraudulent information on your Form W-4 or for willfully failing to supply information that would increase the amount withheld. 2011 income tax The penalty upon conviction can be either a fine of up to $1,000 or imprisonment for up to 1 year, or both. 2011 income tax These penalties will apply if you deliberately and knowingly falsify your Form W-4 in an attempt to reduce or eliminate the proper withholding of taxes. 2011 income tax A simple error or an honest mistake will not result in one of these penalties. 2011 income tax For example, a person who has tried to figure the number of withholding allowances correctly, but claims seven when the proper number is six, will not be charged a W-4 penalty. 2011 income tax Tips The tips you receive while working on your job are considered part of your pay. 2011 income tax You must include your tips on your tax return on the same line as your regular pay. 2011 income tax However, tax is not withheld directly from tip income, as it is from your regular pay. 2011 income tax Nevertheless, your employer will take into account the tips you report when figuring how much to withhold from your regular pay. 2011 income tax See chapter 6 for information on reporting your tips to your employer. 2011 income tax For more information on the withholding rules for tip income, see Publication 531, Reporting Tip Income. 2011 income tax How employer figures amount to withhold. 2011 income tax   The tips you report to your employer are counted as part of your income for the month you report them. 2011 income tax Your employer can figure your withholding in either of two ways. 2011 income tax By withholding at the regular rate on the sum of your pay plus your reported tips. 2011 income tax By withholding at the regular rate on your pay plus a percentage of your reported tips. 2011 income tax Not enough pay to cover taxes. 2011 income tax   If your regular pay is not enough for your employer to withhold all the tax (including income tax and social security and Medicare taxes (or the equivalent railroad retirement tax)) due on your pay plus your tips, you can give your employer money to cover the shortage. 2011 income tax See Giving your employer money for taxes in chapter 6. 2011 income tax Allocated tips. 2011 income tax   Your employer should not withhold income tax, Medicare tax, social security tax, or railroad retirement tax on any allocated tips. 2011 income tax Withholding is based only on your pay plus your reported tips. 2011 income tax Your employer should refund to you any incorrectly withheld tax. 2011 income tax See Allocated Tips in chapter 6 for more information. 2011 income tax Taxable Fringe Benefits The value of certain noncash fringe benefits you receive from your employer is considered part of your pay. 2011 income tax Your employer generally must withhold income tax on these benefits from your regular pay. 2011 income tax For information on fringe benefits, see Fringe Benefits under Employee Compensation in chapter 5. 2011 income tax Although the value of your personal use of an employer-provided car, truck, or other highway motor vehicle is taxable, your employer can choose not to withhold income tax on that amount. 2011 income tax Your employer must notify you if this choice is made. 2011 income tax For more information on withholding on taxable fringe benefits, see chapter 1 of Publication 505. 2011 income tax Sick Pay Sick pay is a payment to you to replace your regular wages while you are temporarily absent from work due to sickness or personal injury. 2011 income tax To qualify as sick pay, it must be paid under a plan to which your employer is a party. 2011 income tax If you receive sick pay from your employer or an agent of your employer, income tax must be withheld. 2011 income tax An agent who does not pay regular wages to you may choose to withhold income tax at a flat rate. 2011 income tax However, if you receive sick pay from a third party who is not acting as an agent of your employer, income tax will be withheld only if you choose to have it withheld. 2011 income tax See Form W-4S , later. 2011 income tax If you receive payments under a plan in which your employer does not participate (such as an accident or health plan where you paid all the premiums), the payments are not sick pay and usually are not taxable. 2011 income tax Union agreements. 2011 income tax   If you receive sick pay under a collective bargaining agreement between your union and your employer, the agreement may determine the amount of income tax withholding. 2011 income tax See your union representative or your employer for more information. 2011 income tax Form W-4S. 2011 income tax   If you choose to have income tax withheld from sick pay paid by a third party, such as an insurance company, you must fill out Form W-4S. 2011 income tax Its instructions contain a worksheet you can use to figure the amount you want withheld. 2011 income tax They also explain restrictions that may apply. 2011 income tax   Give the completed form to the payer of your sick pay. 2011 income tax The payer must withhold according to your directions on the form. 2011 income tax Estimated tax. 2011 income tax   If you do not request withholding on Form W-4S, or if you do not have enough tax withheld, you may have to make estimated tax payments. 2011 income tax If you do not pay enough tax, either through estimated tax or withholding, or a combination of both, you may have to pay a penalty. 2011 income tax See Underpayment Penalty for 2013 at the end of this chapter. 2011 income tax Pensions and Annuities Income tax usually will be withheld from your pension or annuity distributions unless you choose not to have it withheld. 2011 income tax This rule applies to distributions from: A traditional individual retirement arrangement (IRA); A life insurance company under an endowment, annuity, or life insurance contract; A pension, annuity, or profit-sharing plan; A stock bonus plan; and Any other plan that defers the time you receive compensation. 2011 income tax The amount withheld depends on whether you receive payments spread out over more than 1 year (periodic payments), within 1 year (nonperiodic payments), or as an eligible rollover distribution (ERD). 2011 income tax Income tax withholding from an ERD is mandatory. 2011 income tax More information. 2011 income tax   For more information on taxation of annuities and distributions (including ERDs) from qualified retirement plans, see chapter 10. 2011 income tax For information on IRAs, see chapter 17. 2011 income tax For more information on withholding on pensions and annuities, including a discussion of Form W-4P, see Pensions and Annuities in chapter 1 of Publication 505. 2011 income tax Gambling Winnings Income tax is withheld at a flat 25% rate from certain kinds of gambling winnings. 2011 income tax Gambling winnings of more than $5,000 from the following sources are subject to income tax withholding. 2011 income tax Any sweepstakes; wagering pool, including payments made to winners of poker tournaments; or lottery. 2011 income tax Any other wager, if the proceeds are at least 300 times the amount of the bet. 2011 income tax It does not matter whether your winnings are paid in cash, in property, or as an annuity. 2011 income tax Winnings not paid in cash are taken into account at their fair market value. 2011 income tax Exception. 2011 income tax   Gambling winnings from bingo, keno, and slot machines generally are not subject to income tax withholding. 2011 income tax However, you may need to provide the payer with a social security number to avoid withholding. 2011 income tax See Backup withholding on gambling winnings in chapter 1 of Publication 505. 2011 income tax If you receive gambling winnings not subject to withholding, you may need to pay estimated tax. 2011 income tax See Estimated Tax for 2014 , later. 2011 income tax If you do not pay enough tax, either through withholding or estimated tax, or a combination of both, you may have to pay a penalty. 2011 income tax See Underpayment Penalty for 2013 at the end of this chapter. 2011 income tax Form W-2G. 2011 income tax   If a payer withholds income tax from your gambling winnings, you should receive a Form W-2G, Certain Gambling Winnings, showing the amount you won and the amount withheld. 2011 income tax Report the tax withheld on line 62 of Form 1040. 2011 income tax Unemployment Compensation You can choose to have income tax withheld from unemployment compensation. 2011 income tax To make this choice, fill out Form W-4V (or a similar form provided by the payer) and give it to the payer. 2011 income tax All unemployment compensation is taxable. 2011 income tax So, if you do not have income tax withheld, you may have to pay estimated tax. 2011 income tax See Estimated Tax for 2014 , later. 2011 income tax If you do not pay enough tax, either through withholding or estimated tax, or a combination of both, you may have to pay a penalty. 2011 income tax For information, see Underpayment Penalty for 2013 at the end of this chapter. 2011 income tax Federal Payments You can choose to have income tax withheld from certain federal payments you receive. 2011 income tax These payments are: Social security benefits, Tier 1 railroad retirement benefits, Commodity credit corporation loans you choose to include in your gross income, Payments under the Agricultural Act of 1949 (7 U. 2011 income tax S. 2011 income tax C. 2011 income tax 1421 et. 2011 income tax seq. 2011 income tax ), as amended, or title II of the Disaster Assistance Act of 1988, that are treated as insurance proceeds and that you receive because: Your crops were destroyed or damaged by drought, flood, or any other natural disaster, or You were unable to plant crops because of a natural disaster described in (a), and Any other payment under Federal law as determined by the Secretary. 2011 income tax To make this choice, fill out Form W-4V (or a similar form provided by the payer) and give it to the payer. 2011 income tax If you do not choose to have income tax withheld, you may have to pay estimated tax. 2011 income tax See Estimated Tax for 2014 , later. 2011 income tax If you do not pay enough tax, either through withholding or estimated tax, or a combination of both, you may have to pay a penalty. 2011 income tax For information, see Underpayment Penalty for 2013 at the end of this chapter. 2011 income tax More information. 2011 income tax   For more information about the tax treatment of social security and railroad retirement benefits, see chapter 11. 2011 income tax Get Publication 225, Farmer's Tax Guide, for information about the tax treatment of commodity credit corporation loans or crop disaster payments. 2011 income tax Backup Withholding Banks or other businesses that pay you certain kinds of income must file an information return (Form 1099) with the IRS. 2011 income tax The information return shows how much you were paid during the year. 2011 income tax It also includes your name and taxpayer identification number (TIN). 2011 income tax TINs are explained in chapter 1 under Social Security Number (SSN) . 2011 income tax These payments generally are not subject to withholding. 2011 income tax However, “backup” withholding is required in certain situations. 2011 income tax Backup withholding can apply to most kinds of payments that are reported on Form 1099. 2011 income tax The payer must withhold at a flat 28% rate in the following situations. 2011 income tax You do not give the payer your TIN in the required manner. 2011 income tax The IRS notifies the payer that the TIN you gave is incorrect. 2011 income tax You are required, but fail, to certify that you are not subject to backup withholding. 2011 income tax The IRS notifies the payer to start withholding on interest or dividends because you have underreported interest or dividends on your income tax return. 2011 income tax The IRS will do this only after it has mailed you four notices over at least a 210-day period. 2011 income tax See Backup Withholding in chapter 1 of Publication 505 for more information. 2011 income tax Penalties. 2011 income tax   There are civil and criminal penalties for giving false information to avoid backup withholding. 2011 income tax The civil penalty is $500. 2011 income tax The criminal penalty, upon conviction, is a fine of up to $1,000 or imprisonment of up to 1 year, or both. 2011 income tax Estimated Tax for 2014 Estimated tax is the method used to pay tax on income that is not subject to withholding. 2011 income tax This includes income from self-employment, interest, dividends, alimony, rent, gains from the sale of assets, prizes, and awards. 2011 income tax You also may have to pay estimated tax if the amount of income tax being withheld from your salary, pension, or other income is not enough. 2011 income tax Estimated tax is used to pay both income tax and self-employment tax, as well as other taxes and amounts reported on your tax return. 2011 income tax If you do not pay enough tax, either through withholding or estimated tax, or a combination of both, you may have to pay a penalty. 2011 income tax If you do not pay enough by the due date of each payment period (see When To Pay Estimated Tax , later), you may be charged a penalty even if you are due a refund when you file your tax return. 2011 income tax For information on when the penalty applies, see Underpayment Penalty for 2013 at the end of this chapter. 2011 income tax Who Does Not Have To Pay Estimated Tax If you receive salaries or wages, you can avoid having to pay estimated tax by asking your employer to take more tax out of your earnings. 2011 income tax To do this, give a new Form W-4 to your employer. 2011 income tax See chapter 1 of Publication 505. 2011 income tax Estimated tax not required. 2011 income tax   You do not have to pay estimated tax for 2014 if you meet all three of the following conditions. 2011 income tax You had no tax liability for 2013. 2011 income tax You were a U. 2011 income tax S. 2011 income tax citizen or resident alien for the whole year. 2011 income tax Your 2013 tax year covered a 12-month period. 2011 income tax   You had no tax liability for 2013 if your total tax was zero or you did not have to file an income tax return. 2011 income tax For the definition of “total tax” for 2013, see Publication 505, chapter 2. 2011 income tax Who Must Pay Estimated Tax If you owe additional tax for 2013, you may have to pay estimated tax for 2014. 2011 income tax You can use the following general rule as a guide during the year to see if you will have enough withholding, or if you should increase your withholding or make estimated tax payments. 2011 income tax General rule. 2011 income tax   In most cases, you must pay estimated tax for 2014 if both of the following apply. 2011 income tax You expect to owe at least $1,000 in tax for 2014, after subtracting your withholding and refundable credits. 2011 income tax You expect your withholding plus your refundable credits to be less than the smaller of: 90% of the tax to be shown on your 2014 tax return, or 100% of the tax shown on your 2013 tax return (but see Special rules for farmers, fishermen, and higher income taxpayers, later). 2011 income tax Your 2013 tax return must cover all 12 months. 2011 income tax    If the result from using the general rule above suggests that you will not have enough withholding, complete the 2014 Estimated Tax Worksheet in Publication 505 for a more accurate calculation. 2011 income tax Special rules for farmers, fishermen, and higher income taxpayers. 2011 income tax   If at least two-thirds of your gross income for tax year 2013 or 2014 is from farming or fishing, substitute 662/3% for 90% in (2a) under the General rule, earlier. 2011 income tax If your AGI for 2013 was more than $150,000 ($75,000 if your filing status for 2014 is married filing a separate return), substitute 110% for 100% in (2b) under General rule , earlier. 2011 income tax See Figure 4-A and Publication 505, chapter 2 for more information. 2011 income tax Figure 4-A. 2011 income tax Do You Have To Pay Estimated Tax? Please click here for the text description of the image. 2011 income tax Figure 4-A Do You Have To Pay Estimated Tax? Aliens. 2011 income tax   Resident and nonresident aliens also may have to pay estimated tax. 2011 income tax Resident aliens should follow the rules in this chapter unless noted otherwise. 2011 income tax Nonresident aliens should get Form 1040-ES (NR), U. 2011 income tax S. 2011 income tax Estimated Tax for Nonresident Alien Individuals. 2011 income tax   You are an alien if you are not a citizen or national of the United States. 2011 income tax You are a resident alien if you either have a green card or meet the substantial presence test. 2011 income tax For more information about the substantial presence test, see Publication 519, U. 2011 income tax S. 2011 income tax Tax Guide for Aliens. 2011 income tax Married taxpayers. 2011 income tax   If you qualify to make joint estimated tax payments, apply the rules discussed here to your joint estimated income. 2011 income tax   You and your spouse can make joint estimated tax payments even if you are not living together. 2011 income tax   However, you and your spouse cannot make joint estimated tax payments if:  You are legally separated under a decree of divorce or separate maintenance, You and your spouse have different tax years, or Either spouse is a nonresident alien (unless that spouse elected to be treated as a resident alien for tax purposes (see chapter 1 of Publication 519)). 2011 income tax   If you do not qualify to make joint estimated tax payments, apply these rules to your separate estimated income. 2011 income tax Making joint or separate estimated tax payments will not affect your choice of filing a joint tax return or separate returns for 2014. 2011 income tax 2013 separate returns and 2014 joint return. 2011 income tax   If you plan to file a joint return with your spouse for 2014, but you filed separate returns for 2013, your 2013 tax is the total of the tax shown on your separate returns. 2011 income tax You filed a separate return if you filed as single, head of household, or married filing separately. 2011 income tax 2013 joint return and 2014 separate returns. 2011 income tax   If you plan to file a separate return for 2014 but you filed a joint return for 2013, your 2013 tax is your share of the tax on the joint return. 2011 income tax You file a separate return if you file as single, head of household, or married filing separately. 2011 income tax   To figure your share of the tax on the joint return, first figure the tax both you and your spouse would have paid had you filed separate returns for 2013 using the same filing status as for 2014. 2011 income tax Then multiply the tax on the joint return by the following fraction. 2011 income tax     The tax you would have paid had you filed a separate return   The total tax you and your spouse would have paid had you filed separate returns Example. 2011 income tax Joe and Heather filed a joint return for 2013 showing taxable income of $48,500 and a tax of $6,386. 2011 income tax Of the $48,500 taxable income, $40,100 was Joe's and the rest was Heather's. 2011 income tax For 2014, they plan to file married filing separately. 2011 income tax Joe figures his share of the tax on the 2013 joint return as follows. 2011 income tax   Tax on $40,100 based on a separate return $5,960     Tax on $8,400 based on a separate return 843     Total $6,803     Joe's percentage of total ($5,960 ÷ $6,803) 87. 2011 income tax 6%     Joe's share of tax on joint return  ($6,386 × 87. 2011 income tax 6%) $5,594   How To Figure Estimated Tax To figure your estimated tax, you must figure your expected adjusted gross income (AGI), taxable income, taxes, deductions, and credits for the year. 2011 income tax When figuring your 2014 estimated tax, it may be helpful to use your income, deductions, and credits for 2013 as a starting point. 2011 income tax Use your 2013 federal tax return as a guide. 2011 income tax You can use Form 1040-ES and Publication 505 to figure your estimated tax. 2011 income tax Nonresident aliens use Form 1040-ES (NR) and Publication 505 to figure estimated tax (see chapter 8 of Publication 519 for more information). 2011 income tax You must make adjustments both for changes in your own situation and for recent changes in the tax law. 2011 income tax For a discussion of these changes, visit IRS. 2011 income tax gov. 2011 income tax For more complete information on how to figure your estimated tax for 2014, see chapter 2 of Publication 505. 2011 income tax When To Pay Estimated Tax For estimated tax purposes, the tax year is divided into four payment periods. 2011 income tax Each period has a specific payment due date. 2011 income tax If you do not pay enough tax by the due date of each payment period, you may be charged a penalty even if you are due a refund when you file your income tax return. 2011 income tax The payment periods and due dates for estimated tax payments are shown next. 2011 income tax   For the period: Due date:*     Jan. 2011 income tax 1 – March 31 April 15     April 1 – May 31 June 16     June 1 – August 31 Sept. 2011 income tax 15     Sept. 2011 income tax 1– Dec. 2011 income tax 31 Jan. 2011 income tax 15, next year     *See Saturday, Sunday, holiday rule and January payment . 2011 income tax Saturday, Sunday, holiday rule. 2011 income tax   If the due date for an estimated tax payment falls on a Saturday, Sunday, or legal holiday, the payment will be on time if you make it on the next day that is not a Saturday, Sunday, or legal holiday. 2011 income tax January payment. 2011 income tax   If you file your 2014 Form 1040 or Form 1040A by January 31, 2015, and pay the rest of the tax you owe, you do not need to make the payment due on January 15, 2015. 2011 income tax Fiscal year taxpayers. 2011 income tax   If your tax year does not start on January 1, see the Form 1040-ES instructions for your payment due dates. 2011 income tax When To Start You do not have to make estimated tax payments until you have income on which you will owe income tax. 2011 income tax If you have income subject to estimated tax during the first payment period, you must make your first payment by the due date for the first payment period. 2011 income tax You can pay all your estimated tax at that time, or you can pay it in installments. 2011 income tax If you choose to pay in installments, make your first payment by the due date for the first payment period. 2011 income tax Make your remaining installment payments by the due dates for the later periods. 2011 income tax No income subject to estimated tax during first period. 2011 income tax    If you do not have income subject to estimated tax until a later payment period, you must make your first payment by the due date for that period. 2011 income tax You can pay your entire estimated tax by the due date for that period or you can pay it in installments by the due date for that period and the due dates for the remaining periods. 2011 income tax The following chart shows when to make installment payments. 2011 income tax If you first have income on which you must pay estimated tax: Make a payment  by:* Make later installments by:* Before April 1 April 15 June 16 Sept. 2011 income tax 15 Jan. 2011 income tax 15 next year April 1–May 31 June 16 Sept. 2011 income tax 15 Jan. 2011 income tax 15 next year June 1–Aug. 2011 income tax 31 Sept. 2011 income tax 15 Jan. 2011 income tax 15 next year After Aug. 2011 income tax 31 Jan. 2011 income tax 15 next year (None) *See Saturday, Sunday, holiday rule and January payment . 2011 income tax How much to pay to avoid a penalty. 2011 income tax   To determine how much you should pay by each payment due date, see How To Figure Each Payment, next. 2011 income tax How To Figure Each Payment You should pay enough estimated tax by the due date of each payment period to avoid a penalty for that period. 2011 income tax You can figure your required payment for each period by using either the regular installment method or the annualized income installment method. 2011 income tax These methods are described in chapter 2 of Publication 505. 2011 income tax If you do not pay enough during each payment period, you may be charged a penalty even if you are due a refund when you file your tax return. 2011 income tax If the earlier discussion of No income subject to estimated tax during first period or the later discussion of Change in estimated tax applies to you, you may benefit from reading Annualized Income Installment Method in chapter 2 of Publication 505 for information on how to avoid a penalty. 2011 income tax Underpayment penalty. 2011 income tax   Under the regular installment method, if your estimated tax payment for any period is less than one-fourth of your estimated tax, you may be charged a penalty for underpayment of estimated tax for that period when you file your tax return. 2011 income tax Under the annualized income installment method, your estimated tax payments vary with your income, but the amount required must be paid each period. 2011 income tax See chapter 4 of Publication 505 for more information. 2011 income tax Change in estimated tax. 2011 income tax   After you make an estimated tax payment, changes in your income, adjustments, deductions, credits, or exemptions may make it necessary for you to refigure your estimated tax. 2011 income tax Pay the unpaid balance of your amended estimated tax by the next payment due date after the change or in installments by that date and the due dates for the remaining payment periods. 2011 income tax Estimated Tax Payments Not Required You do not have to pay estimated tax if your withholding in each payment period is at least as much as: One-fourth of your required annual payment, or Your required annualized income installment for that period. 2011 income tax You also do not have to pay estimated tax if you will pay enough through withholding to keep the amount you owe with your return under $1,000. 2011 income tax How To Pay Estimated Tax There are several ways to pay estimated tax. 2011 income tax Credit an overpayment on your 2013 return to your 2014 estimated tax. 2011 income tax Pay by direct transfer from your bank account, or pay by credit or debit card using a pay-by-phone system or the Internet. 2011 income tax Send in your payment (check or money order) with a payment voucher from Form 1040-ES. 2011 income tax Credit an Overpayment If you show an overpayment of tax after completing your Form 1040 or Form 1040A for 2013, you can apply part or all of it to your estimated tax for 2014. 2011 income tax On line 75 of Form 1040, or line 44 of Form 1040A, enter the amount you want credited to your estimated tax rather than refunded. 2011 income tax Take the amount you have credited into account when figuring your estimated tax payments. 2011 income tax You cannot have any of the amount you credited to your estimated tax refunded to you until you file your tax return for the following year. 2011 income tax You also cannot use that overpayment in any other way. 2011 income tax Pay Online Paying online is convenient and secure and helps make sure we get your payments on time. 2011 income tax You can pay using either of the following electronic payment methods. 2011 income tax Direct transfer from your bank account. 2011 income tax Credit or debit card. 2011 income tax To pay your taxes online or for more information, go to www. 2011 income tax irs. 2011 income tax gov/e-pay. 2011 income tax Pay by Phone Paying by phone is another safe and secure method of paying electronically. 2011 income tax Use one of the following methods. 2011 income tax Direct transfer from your bank account. 2011 income tax Credit or debit card. 2011 income tax To pay by direct transfer from your bank account, call 1-800-555-4477 (English), 1-800-244-4829 (Espanol). 2011 income tax People who are deaf, hard of hearing, or have a speech disability and who have access to TTY/TDD can call 1-800-733-4829. 2011 income tax To pay using a credit or debit card, you can call one of the following service providers. 2011 income tax There is a convenience fee charged by these providers that varies by provider, card type, and payment amount. 2011 income tax WorldPay 1-888-9-PAY-TAXTM(1-888-972-9829) www. 2011 income tax payUSAtax. 2011 income tax com Official Payments Corporation 1-888-UPAY-TAXTM (1-888-872-9829) www. 2011 income tax officialpayments. 2011 income tax com Link2Gov Corporation 1-888-PAY-1040TM (1-888-729-1040) www. 2011 income tax PAY1040. 2011 income tax com For the latest details on how to pay by phone, go to www. 2011 income tax irs. 2011 income tax gov/e-pay. 2011 income tax Pay by Check or Money Order Using the Estimated Tax Payment Voucher Each payment of estimated tax by check or money order must be accompanied by a payment voucher from Form 1040-ES. 2011 income tax During 2013, if you: made at least one estimated tax payment but not by electronic means, did not use software or a paid preparer to prepare or file your return,  then you should receive a copy of the 2014 Form 1040-ES/V. 2011 income tax The enclosed payment vouchers will be preprinted with your name, address, and social security number. 2011 income tax Using the preprinted vouchers will speed processing, reduce the chance of error, and help save processing costs. 2011 income tax Use the window envelopes that came with your Form 1040-ES package. 2011 income tax If you use your own envelopes, make sure you mail your payment vouchers to the address shown in the Form 1040-ES instructions for the place where you live. 2011 income tax Note. 2011 income tax These criteria can change without notice. 2011 income tax If you do not receive a Form 1040-ES/V package and you are required to make an estimated tax payment, you should go to www. 2011 income tax irs. 2011 income tax gov and print a copy of Form 1040-ES which includes four blank payment vouchers. 2011 income tax Complete one of these and make your payment timely to avoid penalties for paying late. 2011 income tax Do not use the address shown in the Form 1040 or Form 1040A instructions for your estimated tax payments. 2011 income tax If you did not pay estimated tax last year, you can order Form 1040-ES from the IRS (see inside back cover of this publication) or download it from IRS. 2011 income tax gov. 2011 income tax Follow the instructions to make sure you use the vouchers correctly. 2011 income tax Joint estimated tax payments. 2011 income tax   If you file a joint return and are making joint estimated tax payments, enter the names and social security numbers on the payment voucher in the same order as they will appear on the joint return. 2011 income tax Change of address. 2011 income tax   You must notify the IRS if you are making estimated tax payments and you changed your address during the year. 2011 income tax Complete Form 8822, Change of Address, and mail it to the address shown in the instructions for that form. 2011 income tax Credit for Withholding and Estimated Tax for 2013 When you file your 2013 income tax return, take credit for all the income tax and excess social security or railroad retirement tax withheld from your salary, wages, pensions, etc. 2011 income tax Also take credit for the estimated tax you paid for 2013. 2011 income tax These credits are subtracted from your total tax. 2011 income tax Because these credits are refundable, you should file a return and claim these credits, even if you do not owe tax. 2011 income tax Two or more employers. 2011 income tax   If you had two or more employers in 2013 and were paid wages of more than $113,700, too much social security or tier 1 railroad retirement tax may have been withheld from your pay. 2011 income tax You may be able to claim the excess as a credit against your income tax when you file your return. 2011 income tax See Credit for Excess Social Security Tax or Railroad Retirement Tax Withheld in chapter 37. 2011 income tax Withholding If you had income tax withheld during 2013, you should be sent a statement by January 31, 2014, showing your income and the tax withheld. 2011 income tax Depending on the source of your income, you should receive: Form W-2, Wage and Tax Statement, Form W-2G, Certain Gambling Winnings, or A form in the 1099 series. 2011 income tax Forms W-2 and W-2G. 2011 income tax   If you file a paper return, always file Form W-2 with your income tax return. 2011 income tax File Form W-2G with your return only if it shows any federal income tax withheld from your winnings. 2011 income tax   You should get at least two copies of each form. 2011 income tax If you file a paper return, attach one copy to the front of your federal income tax return. 2011 income tax Keep one copy for your records. 2011 income tax You also should receive copies to file with your state and local returns. 2011 income tax Form W-2 Your employer is required to provide or send Form W-2 to you no later than January 31, 2014. 2011 income tax You should receive a separate Form W-2 from each employer you worked for. 2011 income tax If you stopped working before the end of 2013, your employer could have given you your Form W-2 at any time after you stopped working. 2011 income tax However, your employer must provide or send it to you by January 31, 2014. 2011 income tax If you ask for the form, your employer must send it to you within 30 days after receiving your written request or within 30 days after your final wage payment, whichever is later. 2011 income tax If you have not received your Form W-2 by January 31, you should ask your employer for it. 2011 income tax If you do not receive it by February 15, call the IRS. 2011 income tax Form W-2 shows your total pay and other compensation and the income tax, social security tax, and Medicare tax that was withheld during the year. 2011 income tax Include the federal income tax withheld (as shown in box 2 of Form W-2) on: Line 62 if you file Form 1040, Line 36 if you file Form 1040A, or Line 7 if you file Form 1040EZ. 2011 income tax In addition, Form W-2 is used to report any taxable sick pay you received and any income tax withheld from your sick pay. 2011 income tax Form W-2G If you had gambling winnings in 2013, the payer may have withheld income tax. 2011 income tax If tax was withheld, the payer will give you a Form W-2G showing the amount you won and the amount of tax withheld. 2011 income tax Report the amounts you won on line 21 of Form 1040. 2011 income tax Take credit for the tax withheld on line 62 of Form 1040. 2011 income tax If you had gambling winnings, you must use Form 1040; you cannot use Form 1040A or Form 1040EZ. 2011 income tax The 1099 Series Most forms in the 1099 series are not filed with your return. 2011 income tax These forms should be furnished to you by January 31, 2014 (or, for Forms 1099-B, 1099-S, and certain Forms 1099-MISC, by February 15, 2014). 2011 income tax Unless instructed to file any of these forms with your return, keep them for your records. 2011 income tax There are several different forms in this series, including: Form 1099-B, Proceeds From Broker and Barter Exchange Transactions; Form 1099-DIV, Dividends and Distributions; Form 1099-G, Certain Government Payments; Form 1099-INT, Interest Income; Form 1099-K, Payment Card and Third Party Network Transactions; Form 1099-MISC, Miscellaneous Income; Form 1099-OID, Original Issue Discount; Form 1099-PATR, Taxable Distributions Received from Cooperatives; Form 1099-Q, Payments From Qualified Education Programs; Form 1099-R, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc. 2011 income tax ; Form 1099-S, Proceeds From Real Estate Transactions; Form RRB-1099, Payments by the Railroad Retirement Board. 2011 income tax If you received the types of income reported on some forms in the 1099 series, you may not be able to use Form 1040A or Form 1040EZ. 2011 income tax See the instructions to these forms for details. 2011 income tax Form 1099-R. 2011 income tax   Attach Form 1099-R to your paper return if box 4 shows federal income tax withheld. 2011 income tax Include the amount withheld in the total on line 62 of Form 1040 or line 36 of Form 1040A. 2011 income tax You cannot use Form 1040EZ if you received payments reported on Form 1099-R. 2011 income tax Backup withholding. 2011 income tax   If you were subject to backup withholding on income you received during 2013, include the amount withheld, as shown on your Form 1099, in the total on line 62 of Form 1040, line 36 of Form 1040A, or line 7 of Form 1040EZ. 2011 income tax Form Not Correct If you receive a form with incorrect information on it, you should ask the payer for a corrected form. 2011 income tax Call the telephone number or write to the address given for the payer on the form. 2011 income tax The corrected Form W-2G or Form 1099 you receive will have an “X” in the “CORRECTED” box at the top of the form. 2011 income tax A special form, Form W-2c, Corrected Wage and Tax Statement, is used to correct a Form W-2. 2011 income tax In certain situations, you will receive two forms in place of the original incorrect form. 2011 income tax This will happen when your taxpayer identification number is wrong or missing, your name and address are wrong, or you received the wrong type of form (for example, a Form 1099-DIV instead of a Form 1099-INT). 2011 income tax One new form you receive will be the same incorrect form or have the same incorrect information, but all money amounts will be zero. 2011 income tax This form will have an “X” in the “CORRECTED” box at the top of the form. 2011 income tax The second new form should have all the correct information, prepared as though it is the original (the “CORRECTED” box will not be checked). 2011 income tax Form Received After Filing If you file your return and you later receive a form for income that you did not include on your return, you should report the income and take credit for any income tax withheld by filing Form 1040X, Amended U. 2011 income tax S. 2011 income tax Individual Income Tax Return. 2011 income tax Separate Returns If you are married but file a separate return, you can take credit only for the tax withheld from your own income. 2011 income tax Do not include any amount withheld from your spouse's income. 2011 income tax However, different rules may apply if you live in a community property state. 2011 income tax Community property states are listed in chapter 2. 2011 income tax For more information on these rules, and some exceptions, see Publication 555, Community Property. 2011 income tax Fiscal Years If you file your tax return on the basis of a fiscal year (a 12-month period ending on the last day of any month except December), you must follow special rules to determine your credit for federal income tax withholding. 2011 income tax For a discussion of how to take credit for withholding on a fiscal year return, see Fiscal Years (FY) in chapter 3 of Publication 505. 2011 income tax Estimated Tax Take credit for all your estimated tax payments for 2013 on line 63 of Form 1040 or line 37 of Form 1040A. 2011 income tax Include any overpayment from 2012 that you had credited to your 2013 estimated tax. 2011 income tax You must use Form 1040 or Form 1040A if you paid estimated tax. 2011 income tax You cannot use Form 1040EZ. 2011 income tax Name changed. 2011 income tax   If you changed your name, and you made estimated tax payments using your old name, attach a brief statement to the front of your paper tax return indicating: When you made the payments, The amount of each payment, Your name when you made the payments, and Your social security number. 2011 income tax The statement should cover payments you made jointly with your spouse as well as any you made separately. 2011 income tax   Be sure to report the change to the Social Security Administration. 2011 income tax This prevents delays in processing your return and issuing any refunds. 2011 income tax Separate Returns If you and your spouse made separate estimated tax payments for 2013 and you file separate returns, you can take credit only for your own payments. 2011 income tax If you made joint estimated tax payments, you must decide how to divide the payments between your returns. 2011 income tax One of you can claim all of the estimated tax paid and the other none, or you can divide it in any other way you agree on. 2011 income tax If you cannot agree, you must divide the payments in proportion to each spouse's individual tax as shown on your separate returns for 2013. 2011 income tax Divorced Taxpayers If you made joint estimated tax payments for 2013, and you were divorced during the year, either you or your former spouse can claim all of the joint payments, or you each can claim part of them. 2011 income tax If you cannot agree on how to divide the payments, you must divide them in proportion to each spouse's individual tax as shown on your separate returns for 2013. 2011 income tax If you claim any of the joint payments on your tax return, enter your former spouse's social security number (SSN) in the space provided on the front of Form 1040 or Form 1040A. 2011 income tax If you divorced and remarried in 2013, enter your present spouse's SSN in that space and write your former spouse's SSN, followed by “DIV,” to the left of Form 1040, line 63, or Form 1040A, line 37. 2011 income tax Underpayment Penalty for 2013 If you did not pay enough tax, either through withholding or by making timely estimated tax payments, you will have an underpayment of estimated tax and you may have to pay a penalty. 2011 income tax Generally, you will not have to pay a penalty for 2013 if any of the following apply. 2011 income tax The total of your withholding and estimated tax payments was at least as much as your 2012 tax (or 110% of your 2012 tax if your AGI was more than $150,000, $75,000 if your 2013 filing status is married filing separately) and you paid all required estimated tax payments on time. 2011 income tax The tax balance due on your 2013 return is no more than 10% of your total 2013 tax, and you paid all required estimated tax payments on time. 2011 income tax Your total 2013 tax minus your withholding and refundable credits is less than $1,000. 2011 income tax You did not have a tax liability for 2012 and your 2012 tax year was 12 months, or You did not have any withholding taxes and your current year tax less any household employment taxes is less than $1,000. 2011 income tax See Publication 505, chapter 4, for a definition of “total tax” for 2012 and 2013. 2011 income tax Farmers and fishermen. 2011 income tax   Special rules apply if you are a farmer or fisherman. 2011 income tax See Farmers and Fishermen in chapter 4 of Publication 505 for more information. 2011 income tax IRS can figure the penalty for you. 2011 income tax   If you think you owe the penalty but you do not want to figure it yourself when you file your tax return, you may not have to. 2011 income tax Generally, the IRS will figure the penalty for you and send you a bill. 2011 income tax However, if you think you are able to lower or eliminate your penalty, you must complete Form 2210 or Form 2210-F and attach it to your paper return. 2011 income tax See chapter 4 of Publication 505. 2011 income tax Prev  Up  Next   Home   More Online Publications
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The 2011 Income Tax

2011 income tax Publication 503 - Main Content Table of Contents Tests To Claim the CreditQualifying Person Test Earned Income Test Work-Related Expense Test Joint Return Test Provider Identification Test How To Figure the CreditFiguring Total Work-Related Expenses Earned Income Limit Dollar Limit Amount of Credit How To Claim the CreditTax credit not refundable. 2011 income tax Employment Taxes for Household Employers How To Get Tax HelpLow Income Taxpayer Clinics Tests To Claim the Credit To be able to claim the credit for child and dependent care expenses, you must file Form 1040, Form 1040A, or Form 1040NR, not Form 1040EZ or Form 1040NR-EZ, and meet all the following tests. 2011 income tax The care must be for one or more qualifying persons who are identified on Form 2441. 2011 income tax (See Qualifying Person Test. 2011 income tax ) You (and your spouse if filing jointly) must have earned income during the year. 2011 income tax (However, see Rule for student-spouse or spouse not able to care for self under Earned Income Test, later. 2011 income tax ) You must pay child and dependent care expenses so you (and your spouse if filing jointly) can work or look for work. 2011 income tax (See Work-Related Expense Test, later. 2011 income tax ) You must make payments for child and dependent care to someone you (and your spouse) cannot claim as a dependent. 2011 income tax If you make payments to your child, he or she cannot be your dependent and must be age 19 or older by the end of the year. 2011 income tax You cannot make payments to: Your spouse, or The parent of your qualifying person if your qualifying person is your child and under age 13. 2011 income tax See Payments to Relatives or Dependents under Work-Related Expense Test, later. 2011 income tax Your filing status may be single, head of household, or qualifying widow(er) with dependent child. 2011 income tax If you are married, you must file a joint return, unless an exception applies to you. 2011 income tax See Joint Return Test, later. 2011 income tax You must identify the care provider on your tax return. 2011 income tax (See Provider Identification Test, later. 2011 income tax ) If you exclude or deduct dependent care benefits provided by a dependent care benefit plan, the total amount you exclude or deduct must be less than the dollar limit for qualifying expenses (generally, $3,000 if one qualifying person was cared for or $6,000 if two or more qualifying persons were cared for). 2011 income tax (If two or more qualifying persons were cared for, the amount you exclude or deduct will always be less than the dollar limit, since the total amount you can exclude or deduct is limited to $5,000. 2011 income tax See Reduced Dollar Limit under How To Figure the Credit, later. 2011 income tax ) These tests are presented in Figure A and are also explained in detail in this publication. 2011 income tax Qualifying Person Test Your child and dependent care expenses must be for the care of one or more qualifying persons. 2011 income tax A qualifying person is: Your qualifying child who is your dependent and who was under age 13 when the care was provided (but see Child of divorced or separated parents or parents living apart , later), Your spouse who was not physically or mentally able to care for himself or herself and lived with you for more than half the year, or A person who was not physically or mentally able to care for himself or herself, lived with you for more than half the year, and either: Was your dependent, or Would have been your dependent except that: He or she received gross income of $3,900 or more, He or she filed a joint return, or You, or your spouse if filing jointly, could be claimed as a dependent on someone else's 2013 return. 2011 income tax Dependent defined. 2011 income tax   A dependent is a person, other than you or your spouse, for whom you can claim an exemption. 2011 income tax To be your dependent, a person must be your qualifying child (or your qualifying relative). 2011 income tax Qualifying child. 2011 income tax   To be your qualifying child, a child must live with you for more than half the year and meet other requirements. 2011 income tax More information. 2011 income tax   For more information about who is a dependent or a qualifying child, see Publication 501. 2011 income tax Physically or mentally not able to care for oneself. 2011 income tax   Persons who cannot dress, clean, or feed themselves because of physical or mental problems are considered not able to care for themselves. 2011 income tax Also, persons who must have constant attention to prevent them from injuring themselves or others are considered not able to care for themselves. 2011 income tax Person qualifying for part of year. 2011 income tax   You determine a person's qualifying status each day. 2011 income tax For example, if the person for whom you pay child and dependent care expenses no longer qualifies on September 16, count only those expenses through September 15. 2011 income tax Also see Yearly limit under Dollar Limit, later. 2011 income tax Birth or death of otherwise qualifying person. 2011 income tax   In determining whether a person is a qualifying person, a person who was born or died in 2013 is treated as having lived with you for more than half of 2013 if your home was the person's home more than half the time he or she was alive in 2013. 2011 income tax Taxpayer identification number. 2011 income tax   You must include on your return the name and taxpayer identification number (generally the social security number) of the qualifying person(s). 2011 income tax If the correct information is not shown, the credit may be reduced or disallowed. 2011 income tax Individual taxpayer identification number (ITIN) for aliens. 2011 income tax   If your qualifying person is a nonresident or resident alien who does not have and cannot get a social security number (SSN), use that person's ITIN. 2011 income tax The ITIN is entered wherever an SSN is requested on a tax return. 2011 income tax If the alien does not have an ITIN, he or she must apply for one. 2011 income tax See Form W-7, Application for IRS Individual Taxpayer Identification Number, for details. 2011 income tax   An ITIN is for tax use only. 2011 income tax It does not entitle the holder to social security benefits or change the holder's employment or immigration status under U. 2011 income tax S. 2011 income tax law. 2011 income tax Adoption taxpayer identification number (ATIN). 2011 income tax   If your qualifying person is a child who was placed in your home for adoption and for whom you do not have an SSN, you must get an ATIN for the child. 2011 income tax File Form W-7A, Application for Taxpayer Identification Number for Pending U. 2011 income tax S. 2011 income tax Adoptions. 2011 income tax Child of divorced or separated parents or parents living apart. 2011 income tax   Even if you cannot claim your child as a dependent, he or she is treated as your qualifying person if: The child was under age 13 or was not physically or mentally able to care for himself or herself, The child received over half of his or her support during the calendar year from one or both parents who are divorced or legally separated under a decree of divorce or separate maintenance, are separated under a written separation agreement, or lived apart at all times during the last 6 months of the calendar year, The child was in the custody of one or both parents for more than half the year, and You were the child's custodial parent. 2011 income tax   The custodial parent is the parent with whom the child lived for the greater number of nights in 2013. 2011 income tax If the child was with each parent for an equal number of nights, the custodial parent is the parent with the higher adjusted gross income. 2011 income tax For details and an exception for a parent who works at night, see Publication 501. 2011 income tax   The noncustodial parent cannot treat the child as a qualifying person even if that parent is entitled to claim the child as a dependent under the special rules for a child of divorced or separated parents. 2011 income tax Please click here for the text description of the image. 2011 income tax Figure a. 2011 income tax Can you claim the credit Earned Income Test To claim the credit, you (and your spouse if filing jointly) must have earned income during the year. 2011 income tax Earned income. 2011 income tax   Earned income includes wages, salaries, tips, other taxable employee compensation, and net earnings from self-employment. 2011 income tax A net loss from self-employment reduces earned income. 2011 income tax Earned income also includes strike benefits and any disability pay you report as wages. 2011 income tax   Generally, only taxable compensation is included. 2011 income tax However, you can elect to include nontaxable combat pay in earned income. 2011 income tax If you are filing a joint return and both you and your spouse received nontaxable combat pay, you can each make your own election. 2011 income tax (In other words, if one of you makes the election, the other one can also make it but does not have to. 2011 income tax ) Including this income will give you a larger credit only if your (or your spouse's) other earned income is less than the amount entered on line 3 of Form 2441. 2011 income tax You should figure your credit both ways and make the election if it gives you a greater tax benefit. 2011 income tax    You can choose to include your nontaxable combat pay in earned income when figuring your credit for child and dependent care expenses, even if you choose not to include it in earned income for the earned income credit or the exclusion or deduction for dependent care benefits. 2011 income tax Members of certain religious faiths opposed to social security. 2011 income tax   This section is for persons who are members of certain religious faiths that are opposed to participation in Social Security Act programs and have an IRS-approved form that exempts certain income from social security and Medicare taxes. 2011 income tax These forms are: Form 4361, Application for Exemption From Self-Employment Tax for Use by Ministers, Members of Religious Orders and Christian Science Practitioners, and Form 4029, Application for Exemption From Social Security and Medicare Taxes and Waiver of Benefits, for use by members of recognized religious groups. 2011 income tax   Each form is discussed here in terms of what is or is not earned income for purposes of the child and dependent care credit. 2011 income tax For information on the use of these forms, see Publication 517, Social Security and Other Information for Members of the Clergy and Religious Workers. 2011 income tax Form 4361. 2011 income tax   Whether or not you have an approved Form 4361, amounts you received for performing ministerial duties as an employee are earned income. 2011 income tax This includes wages, salaries, tips, and other taxable employee compensation. 2011 income tax   However, amounts you received for ministerial duties, but not as an employee, do not count as earned income. 2011 income tax Examples include fees for performing marriages and honoraria for delivering speeches. 2011 income tax   Any amount you received for work that is not related to your ministerial duties is earned income. 2011 income tax Form 4029. 2011 income tax   Whether or not you have an approved Form 4029, all wages, salaries, tips, and other taxable employee compensation are earned income. 2011 income tax   However, amounts you received as a self-employed individual do not count as earned income. 2011 income tax What is not earned income?   Earned income does not include: Pensions and annuities, Social security and railroad retirement benefits, Workers' compensation, Interest and dividends, Unemployment compensation, Scholarships or fellowship grants, except for those reported on Form W-2 and paid to you for teaching or other services, Nontaxable workfare payments, Child support payments received, Income of a nonresident alien that is not effectively connected with a U. 2011 income tax S. 2011 income tax trade or business, or Any amount received for work while an inmate in a penal institution. 2011 income tax Rule for student-spouse or spouse not able to care for self. 2011 income tax   Your spouse is treated as having earned income for any month that he or she is: A full-time student, or Physically or mentally not able to care for himself or herself. 2011 income tax (Your spouse also must live with you for more than half the year. 2011 income tax )   If you are filing a joint return, this rule also applies to you. 2011 income tax You can be treated as having earned income for any month you are a full-time student or not able to care for yourself. 2011 income tax   Figure the earned income of the nonworking spouse, described under (1) or (2) above, as shown under Earned Income Limit under How To Figure the Credit, later. 2011 income tax   This rule applies to only one spouse for any one month. 2011 income tax If, in the same month, both you and your spouse do not work and are either full-time students or not physically or mentally able to care for yourselves, only one of you can be treated as having earned income in that month. 2011 income tax Full-time student. 2011 income tax    You are a full-time student if you are enrolled at a school for the number of hours or classes that the school considers full time. 2011 income tax You must have been a full-time student for some part of each of 5 calendar months during the year. 2011 income tax (The months need not be consecutive. 2011 income tax ) School. 2011 income tax   The term “school” includes high schools, colleges, universities, and technical, trade, and mechanical schools. 2011 income tax A school does not include an on-the-job training course, correspondence school, or school offering courses only through the Internet. 2011 income tax Work-Related Expense Test Child and dependent care expenses must be work-related to qualify for the credit. 2011 income tax Expenses are considered work-related only if both of the following are true. 2011 income tax They allow you (and your spouse if filing jointly) to work or look for work. 2011 income tax They are for a qualifying person's care. 2011 income tax Working or Looking for Work To be work-related, your expenses must allow you to work or look for work. 2011 income tax If you are married, generally both you and your spouse must work or look for work. 2011 income tax One spouse is treated as working during any month he or she is a full-time student or is not physically or mentally able to care for himself or herself. 2011 income tax Your work can be for others or in your own business or partnership. 2011 income tax It can be either full time or part time. 2011 income tax Work also includes actively looking for work. 2011 income tax However, if you do not find a job and have no earned income for the year, you cannot take this credit. 2011 income tax See Earned Income Test, earlier. 2011 income tax An expense is not considered work-related merely because you had it while you were working. 2011 income tax The purpose of the expense must be to allow you to work. 2011 income tax Whether your expenses allow you to work or look for work depends on the facts. 2011 income tax Example 1. 2011 income tax The cost of a babysitter while you and your spouse go out to eat is not normally a work-related expense. 2011 income tax Example 2. 2011 income tax You work during the day. 2011 income tax Your spouse works at night and sleeps during the day. 2011 income tax You pay for care of your 5-year-old child during the hours when you are working and your spouse is sleeping. 2011 income tax Your expenses are considered work-related. 2011 income tax Volunteer work. 2011 income tax   For this purpose, you are not considered to be working if you do unpaid volunteer work or volunteer work for a nominal salary. 2011 income tax Work for part of year. 2011 income tax   If you work or actively look for work during only part of the period covered by the expenses, then you must figure your expenses for each day. 2011 income tax For example, if you work all year and pay care expenses of $250 a month ($3,000 for the year), all the expenses are work related. 2011 income tax However, if you work or look for work for only 2 months and 15 days during the year and pay expenses of $250 a month, your work-related expenses are limited to $625 (2½ months × $250). 2011 income tax Temporary absence from work. 2011 income tax   You do not have to figure your expenses for each day during a short, temporary absence from work, such as for vacation or a minor illness, if you have to pay for care anyway. 2011 income tax Instead, you can figure your credit including the expenses you paid for the period of absence. 2011 income tax   An absence of 2 weeks or less is a short, temporary absence. 2011 income tax An absence of more than 2 weeks may be considered a short, temporary absence, depending on the circumstances. 2011 income tax Example. 2011 income tax You pay a nanny to care for your 2-year-old son and 4-year-old daughter so you can work. 2011 income tax You become ill and miss 4 months of work but receive sick pay. 2011 income tax You continue to pay the nanny to care for the children while you are ill. 2011 income tax Your absence is not a short, temporary absence, and your expenses are not considered work-related. 2011 income tax Part-time work. 2011 income tax   If you work part-time, you generally must figure your expenses for each day. 2011 income tax However, if you have to pay for care weekly, monthly, or in another way that includes both days worked and days not worked, you can figure your credit including the expenses you paid for days you did not work. 2011 income tax Any day when you work at least 1 hour is a day of work. 2011 income tax Example 1. 2011 income tax You work 3 days a week. 2011 income tax While you work, your 6-year-old child attends a dependent care center, which complies with all state and local regulations. 2011 income tax You can pay the center $150 for any 3 days a week or $250 for 5 days a week. 2011 income tax Your child attends the center 5 days a week. 2011 income tax Your work-related expenses are limited to $150 a week. 2011 income tax Example 2. 2011 income tax The facts are the same as in Example 1 except the center does not offer a 3-day option. 2011 income tax The entire $250 weekly fee may be a work-related expense. 2011 income tax Care of a Qualifying Person To be work-related, your expenses must be to provide care for a qualifying person. 2011 income tax You do not have to choose the least expensive way of providing the care. 2011 income tax The cost of a paid care provider may be an expense for the care of a qualifying person even if another care provider is available at no cost. 2011 income tax Expenses are for the care of a qualifying person only if their main purpose is the person's well-being and protection. 2011 income tax Expenses for household services qualify if part of the services is for the care of qualifying persons. 2011 income tax See Household Services, later. 2011 income tax Expenses not for care. 2011 income tax   Expenses for care do not include amounts you pay for food, lodging, clothing, education, and entertainment. 2011 income tax However, you can include small amounts paid for these items if they are incidental to and cannot be separated from the cost of caring for the qualifying person. 2011 income tax Otherwise, see the discussion of Expenses partly work-related, later. 2011 income tax   Child support payments are not for care and do not qualify for the credit. 2011 income tax Education. 2011 income tax   Expenses for a child in nursery school, preschool, or similar programs for children below the level of kindergarten are expenses for care. 2011 income tax   Expenses to attend kindergarten or a higher grade are not expenses for care. 2011 income tax Do not use these expenses to figure your credit. 2011 income tax   However, expenses for before- or after-school care of a child in kindergarten or a higher grade may be expenses for care. 2011 income tax   Summer school and tutoring programs are not for care. 2011 income tax Example 1. 2011 income tax You take your 3-year-old child to a nursery school that provides lunch and a few educational activities as part of its preschool childcare service. 2011 income tax The lunch and educational activities are incidental to the childcare, and their cost cannot be separated from the cost of care. 2011 income tax You can count the total cost when you figure the credit. 2011 income tax Example 2. 2011 income tax You place your 10-year-old child in a boarding school so you can work full time. 2011 income tax Only the part of the boarding school expense that is for the care of your child is a work-related expense. 2011 income tax You can count that part of the expense in figuring your credit if it can be separated from the cost of education. 2011 income tax You cannot count any part of the amount you pay the school for your child's education. 2011 income tax Care outside your home. 2011 income tax   You can count the cost of care provided outside your home if the care is for your dependent under age 13 or any other qualifying person who regularly spends at least 8 hours each day in your home. 2011 income tax Dependent care center. 2011 income tax   You can count care provided outside your home by a dependent care center only if the center complies with all state and local regulations that apply to these centers. 2011 income tax   A dependent care center is a place that provides care for more than six persons (other than persons who live there) and receives a fee, payment, or grant for providing services for any of those persons, even if the center is not run for profit. 2011 income tax Camp. 2011 income tax   The cost of sending your child to an overnight camp is not considered a work-related expense. 2011 income tax    The cost of sending your child to a day camp may be a work-related expense, even if the camp specializes in a particular activity, such as computers or soccer. 2011 income tax Transportation. 2011 income tax   If a care provider takes a qualifying person to or from a place where care is provided, that transportation is for the care of the qualifying person. 2011 income tax This includes transportation by bus, subway, taxi, or private car. 2011 income tax However, transportation not provided by a care provider is not for the care of a qualifying person. 2011 income tax Also, if you pay the transportation cost for the care provider to come to your home, that expense is not for care of a qualifying person. 2011 income tax Fees and deposits. 2011 income tax   Fees you paid to an agency to get the services of a care provider, deposits you paid to an agency or preschool, application fees, and other indirect expenses are work-related expenses if you have to pay them to get care, even though they are not directly for care. 2011 income tax However, a forfeited deposit is not for the care of a qualifying person if care is not provided. 2011 income tax Example 1. 2011 income tax You paid a fee to an agency to get the services of the nanny who cares for your 2-year-old daughter while you work. 2011 income tax The fee you paid is a work-related expense. 2011 income tax Example 2. 2011 income tax You placed a deposit with a preschool to reserve a place for your 3-year-old child. 2011 income tax You later sent your child to a different preschool and forfeited the deposit. 2011 income tax The forfeited deposit is not for care and so is not a work-related expense. 2011 income tax Household Services Expenses you pay for household services meet the work-related expense test if they are at least partly for the well-being and protection of a qualifying person. 2011 income tax Definition. 2011 income tax   Household services are ordinary and usual services done in and around your home that are necessary to run your home. 2011 income tax They include the services of a housekeeper, maid, or cook. 2011 income tax However, they do not include the services of a chauffeur, bartender, or gardener. 2011 income tax Housekeeper. 2011 income tax   In this publication, the term housekeeper refers to any household employee whose services include the care of a qualifying person. 2011 income tax Expenses partly work-related. 2011 income tax   If part of an expense is work-related (for either household services or the care of a qualifying person) and part is for other purposes, you have to divide the expense. 2011 income tax To figure your credit, count only the part that is work-related. 2011 income tax However, you do not have to divide the expense if only a small part is for other purposes. 2011 income tax Example. 2011 income tax You pay a housekeeper to care for your 9-year-old and 15-year-old children so you can work. 2011 income tax The housekeeper spends most of the time doing normal household work and spends 30 minutes a day driving you to and from work. 2011 income tax You do not have to divide the expenses. 2011 income tax You can treat the entire expense of the housekeeper as work-related because the time spent driving is minimal. 2011 income tax Nor do you have to divide the expenses between the two children, even though the expenses are partly for the 15-year-old child who is not a qualifying person, because the expense is also partly for the care of your 9-year-old child, who is a qualifying person. 2011 income tax However, the dollar limit (discussed later) is based on one qualifying person, not two. 2011 income tax Meals and lodging provided for housekeeper. 2011 income tax   If you have expenses for meals that your housekeeper eats in your home because of his or her employment, count these as work-related expenses. 2011 income tax If you have extra expenses for providing lodging in your home to the housekeeper, count these as work-related expenses also. 2011 income tax Example. 2011 income tax To provide lodging to the housekeeper, you move to an apartment with an extra bedroom. 2011 income tax You can count the extra rent and utility expenses for the housekeeper's bedroom as work-related. 2011 income tax However, if your housekeeper moves into an existing bedroom in your home, you can count only the extra utility expenses as work-related. 2011 income tax Taxes paid on wages. 2011 income tax   The taxes you pay on wages for qualifying child and dependent care services are work-related expenses. 2011 income tax For more information on a household employer's tax responsibilities, see Employment Taxes for Household Employers, later. 2011 income tax Payments to Relatives or Dependents You can count work-related payments you make to relatives who are not your dependents, even if they live in your home. 2011 income tax However, do not count any amounts you pay to: A dependent for whom you (or your spouse if filing jointly) can claim an exemption, Your child who was under age 19 at the end of the year, even if he or she is not your dependent, A person who was your spouse any time during the year, or The parent of your qualifying person if your qualifying person is your child and under age 13. 2011 income tax Joint Return Test Generally, married couples must file a joint return to take the credit. 2011 income tax However, if you are legally separated or living apart from your spouse, you may be able to file a separate return and still take the credit. 2011 income tax Legally separated. 2011 income tax   You are not considered married if you are legally separated from your spouse under a decree of divorce or separate maintenance. 2011 income tax You may be eligible to take the credit on your return using head of household filing status. 2011 income tax Married and living apart. 2011 income tax   You are not considered married and are eligible to take the credit if all the following apply. 2011 income tax You file a return apart from your spouse. 2011 income tax Your home is the home of a qualifying person for more than half the year. 2011 income tax You pay more than half the cost of keeping up your home for the year. 2011 income tax Your spouse does not live in your home for the last 6 months of the year. 2011 income tax Costs of keeping up a home. 2011 income tax   The costs of keeping up a home normally include property taxes, mortgage interest, rent, utility charges, home repairs, insurance on the home, and food eaten at home. 2011 income tax   The costs of keeping up a home do not include payments for clothing, education, medical treatment, vacations, life insurance, transportation, or mortgage principal. 2011 income tax   They also do not include the purchase, permanent improvement, or replacement of property. 2011 income tax For example, you cannot include the cost of replacing a water heater. 2011 income tax However, you can include the cost of repairing a water heater. 2011 income tax Death of spouse. 2011 income tax   If your spouse died during the year and you do not remarry before the end of the year, you generally must file a joint return to take the credit. 2011 income tax If you do remarry before the end of the year, the credit can be claimed on your deceased spouse's own return. 2011 income tax Provider Identification Test You must identify all persons or organizations that provide care for your child or dependent. 2011 income tax Use Form 2441, Part I, to show the information. 2011 income tax If you do not have any care providers and you are filing Form 2441 only to report taxable income in Part III, enter “none” in line 1, column (a). 2011 income tax Information needed. 2011 income tax   To identify the care provider, you must give the provider's: Name, Address, and Taxpayer identification number. 2011 income tax    If the care provider is an individual, the taxpayer identification number is his or her social security number or individual taxpayer identification number. 2011 income tax If the care provider is an organization, then it is the employer identification number (EIN). 2011 income tax   You do not have to show the taxpayer identification number if the care provider is a tax-exempt organization (such as a church or school). 2011 income tax In this case, enter “Tax-Exempt” in the space where Form 2441 asks for the number. 2011 income tax   If you cannot provide all of the information or the information is incorrect, you must be able to show that you used due diligence (discussed later) in trying to furnish the necessary information. 2011 income tax Getting the information. 2011 income tax    You can use Form W-10, Dependent Care Provider's Identification and Certification, to request the required information from the care provider. 2011 income tax If you do not use Form W-10, you can get the information from one of the other sources listed in the instructions for Form W-10, including: A copy of the provider's social security card, A copy of the provider's completed Form W-4, Employee's Withholding Allowance Certificate, if he or she is your household employee, A copy of the statement furnished by your employer if the provider is your employer's dependent care plan, or A letter or invoice from the provider if it shows the necessary information. 2011 income tax    You should keep this information with your tax records. 2011 income tax Do not send Form W-10 (or other document containing this information) to the Internal Revenue Service. 2011 income tax Due diligence. 2011 income tax   If the care provider information you give is incorrect or incomplete, your credit may not be allowed. 2011 income tax However, if you can show that you used due diligence in trying to supply the information, you can still claim the credit. 2011 income tax   You can show due diligence by getting and keeping the provider's completed Form W-10 or one of the other sources of information just listed. 2011 income tax Care providers can be penalized if they do not provide this information to you or if they provide incorrect information. 2011 income tax Provider refusal. 2011 income tax    If the provider refuses to give you the identifying information, you should report on Form 2441 whatever information you have (such as the name and address). 2011 income tax Enter “See Attached Statement” in the columns calling for the information you do not have. 2011 income tax Then attach a statement explaining that you requested the information from the care provider, but the provider did not give you the information. 2011 income tax Be sure to write your name and social security number on this statement. 2011 income tax The statement will show that you used due diligence in trying to furnish the necessary information. 2011 income tax U. 2011 income tax S. 2011 income tax citizens and resident aliens living abroad. 2011 income tax   If you are living abroad, your care provider may not have, and may not be required to get, a U. 2011 income tax S. 2011 income tax taxpayer identification number (for example, an SSN or an EIN). 2011 income tax If so, enter “LAFCP” (Living Abroad Foreign Care Provider) in the space for the care provider's taxpayer identification number. 2011 income tax How To Figure the Credit Your credit is a percentage of your work-related expenses. 2011 income tax Your expenses are subject to the earned income limit and the dollar limit. 2011 income tax The percentage is based on your adjusted gross income. 2011 income tax Figuring Total Work-Related Expenses To figure the credit for 2013 work-related expenses, count only those you paid by December 31, 2013. 2011 income tax Expenses prepaid in an earlier year. 2011 income tax   If you pay for services before they are provided, you can count the prepaid expenses only in the year the care is received. 2011 income tax Claim the expenses for the later year as if they were actually paid in that later year. 2011 income tax Expenses not paid until the following year. 2011 income tax   Do not count 2012 expenses that you paid in 2013 as work-related expenses for 2013. 2011 income tax You may be able to claim an additional credit for them on your 2013 return, but you must figure it separately. 2011 income tax See Payments for prior year's expenses under Amount of Credit, later. 2011 income tax If you had expenses in 2013 that you did not pay until 2014, you cannot count them when figuring your 2013 credit. 2011 income tax You may be able to claim a credit for them on your 2014 return. 2011 income tax Expenses reimbursed. 2011 income tax   If a state social services agency pays you a nontaxable amount to reimburse you for some of your child and dependent care expenses, you cannot count the expenses that are reimbursed as work-related expenses. 2011 income tax Example. 2011 income tax You paid work-related expenses of $3,000. 2011 income tax You are reimbursed $2,000 by a state social services agency. 2011 income tax You can use only $1,000 to figure your credit. 2011 income tax Medical expenses. 2011 income tax   Some expenses for the care of qualifying persons who are not able to care for themselves may qualify as work-related expenses and also as medical expenses. 2011 income tax You can use them either way, but you cannot use the same expenses to claim both a credit and a medical expense deduction. 2011 income tax   If you use these expenses to figure the credit and they are more than the earned income limit or the dollar limit, discussed later, you can add the excess to your medical expenses. 2011 income tax However, if you use your total expenses to figure your medical expense deduction, you cannot use any part of them to figure your credit. 2011 income tax For information on medical expenses, see Publication 502, Medical and Dental Expenses. 2011 income tax    Amounts excluded from your income under your employer's dependent care benefits plan cannot be used to claim a medical expense deduction. 2011 income tax Dependent Care Benefits If you receive dependent care benefits, your dollar limit for purposes of the credit may be reduced. 2011 income tax See Reduced Dollar Limit, later. 2011 income tax But, even if you cannot take the credit, you may be able to take an exclusion or deduction for the dependent care benefits. 2011 income tax Dependent care benefits. 2011 income tax    Dependent care benefits include: Amounts your employer paid directly to either you or your care provider for the care of your qualifying person while you work, The fair market value of care in a daycare facility provided or sponsored by your employer, and Pre-tax contributions you made under a dependent care flexible spending arrangement. 2011 income tax Your salary may have been reduced to pay for these benefits. 2011 income tax If you received benefits as an employee, they should be shown in box 10 of your Form W-2, Wage and Tax Statement. 2011 income tax See Statement for employee, later. 2011 income tax Benefits you received as a partner should be shown in box 13 of your Schedule K-1 (Form 1065) with code O. 2011 income tax   Enter the amount of these benefits on Form 2441, Part III, line 12. 2011 income tax Exclusion or deduction. 2011 income tax   If your employer provides dependent care benefits under a qualified plan, you may be able to exclude these benefits from your income. 2011 income tax Your employer can tell you whether your benefit plan qualifies. 2011 income tax To claim the exclusion, you must complete Part III of Form 2441. 2011 income tax You cannot use Form 1040EZ. 2011 income tax   If you are self-employed and receive benefits from a qualified dependent care benefit plan, you are treated as both employer and employee. 2011 income tax Therefore, you would not get an exclusion from wages. 2011 income tax Instead, you would get a deduction on Form 1040, Schedule C, line 14; Schedule E, line 19 or 28; or Schedule F, line 15. 2011 income tax To claim the deduction, you must use Form 2441. 2011 income tax   The amount you can exclude or deduct is limited to the smallest of: The total amount of dependent care benefits you received during the year, The total amount of qualified expenses you incurred during the year, Your earned income, Your spouse's earned income, or $5,000 ($2,500 if married filing separately). 2011 income tax   The definition of earned income for the exclusion or deduction is the same as the definition used when figuring the credit except that earned income for the exclusion or deduction does not include any dependent care benefits you receive. 2011 income tax    You can choose to include your nontaxable combat pay in earned income when figuring your exclusion or deduction, even if you choose not to include it in earned income for the earned income credit or the credit for child and dependent care expenses. 2011 income tax Statement for employee. 2011 income tax   Your employer must give you a Form W-2 (or similar statement), showing in box 10 the total amount of dependent care benefits provided to you during the year under a qualified plan. 2011 income tax Your employer will also include any dependent care benefits over $5,000 in your wages shown on your Form W-2 in box 1. 2011 income tax Effect of exclusion on credit. 2011 income tax   If you exclude dependent care benefits from your income, the amount of the excluded benefits: Is not included in your work-related expenses, and Reduces the dollar limit, discussed later. 2011 income tax Earned Income Limit The amount of work-related expenses you use to figure your credit cannot be more than: Your earned income for the year, if you are single at the end of the year, or The smaller of your or your spouse's earned income for the year if you are married at the end of the year. 2011 income tax Earned income for the purpose of figuring the credit is defined under Earned Income Test, earlier. 2011 income tax For purposes of item (2), use your spouse's earned income for the entire year, even if you were married for only part of the year. 2011 income tax Example. 2011 income tax You remarried on December 3. 2011 income tax Your earned income for the year was $18,000. 2011 income tax Your new spouse's earned income for the year was $2,000. 2011 income tax You paid work-related expenses of $3,000 for the care of your 5-year-old child and qualified to claim the credit. 2011 income tax The amount of expenses you use to figure your credit cannot be more than $2,000 (the smaller of your earned income or that of your spouse). 2011 income tax Separated spouse. 2011 income tax   If you are legally separated or married and living apart from your spouse (as described under Joint Return Test, earlier), you are not considered married for purposes of the earned income limit. 2011 income tax Use only your income in figuring the earned income limit. 2011 income tax Surviving spouse. 2011 income tax   If your spouse died during the year and you file a joint return as a surviving spouse, you may, but are not required to, take into account the earned income of your spouse who died during the year. 2011 income tax Community property laws. 2011 income tax   Disregard community property laws when you figure earned income for this credit. 2011 income tax Self-employment earnings. 2011 income tax   If you are self-employed, include your net earnings in earned income. 2011 income tax For purposes of the child and dependent care credit, net earnings from self-employment generally means the amount from Schedule SE (either Section A or Section B), line 3, minus any deduction for self-employment tax on Form 1040 or Form 1040NR, line 27. 2011 income tax Include your self-employment earnings in earned income, even if they are less than $400 and you did not file Schedule SE. 2011 income tax Clergy or church employee. 2011 income tax   If you are a member of the clergy or a church employee, see the Instructions for Form 2441 for details. 2011 income tax Statutory employee. 2011 income tax   If you filed Schedule C (Form 1040) or C-EZ (Form 1040) to report income as a statutory employee, also include as earned income the amount from line 1 of that Schedule C (Form 1040) or C-EZ (Form 1040). 2011 income tax Net loss. 2011 income tax   You must reduce your earned income by any net loss from self-employment. 2011 income tax Optional method if earnings are low or a net loss. 2011 income tax   If your net earnings from self-employment are low or you have a net loss, you may be able to figure your net earnings by using an optional method instead of the regular method. 2011 income tax Get Publication 334, Tax Guide for Small Business, for details. 2011 income tax If you use an optional method to figure net earnings for self-employment tax purposes, include those net earnings in your earned income for this credit. 2011 income tax In this case, subtract any deduction you claimed on Form 1040 or Form 1040NR, line 27, from the total of the amounts on Schedule SE, Section B, lines 3 and 4b, to figure your net earnings. 2011 income tax You or your spouse is a student or not able to care for self. 2011 income tax   Your spouse who is either a full-time student or not able to care for himself or herself is treated as having earned income. 2011 income tax His or her earned income for each month is considered to be at least $250 if there is one qualifying person in your home, or at least $500 if there are two or more. 2011 income tax Spouse works. 2011 income tax   If your spouse works during that month, use the higher of $250 (or $500) or his or her actual earned income for that month. 2011 income tax Spouse qualifies for part of month. 2011 income tax   If your spouse is a full-time student or not able to care for himself or herself for only part of a month, the full $250 (or $500) still applies for that month. 2011 income tax You are a student or not able to care for self. 2011 income tax   These rules also apply if you are a student or not able to care for yourself and are filing a joint return. 2011 income tax For each month or part of a month you are a student or not able to care for yourself, your earned income is considered to be at least $250 (or $500). 2011 income tax If you also work during that month, use the higher of $250 (or $500) or your actual earned income for that month. 2011 income tax Both spouses qualify. 2011 income tax   If, in the same month, both you and your spouse are either full-time students or not able to care for yourselves, only one spouse can be considered to have this earned income of $250 (or $500) for that month. 2011 income tax Example. 2011 income tax Jim works and keeps up a home for himself and his wife Sharon. 2011 income tax Because of an accident, Sharon is not able to care for herself for 11 months during the tax year. 2011 income tax During the 11 months, Jim pays $3,300 of work-related expenses for Sharon's care. 2011 income tax These expenses also qualify as medical expenses. 2011 income tax Their adjusted gross income is $29,000 and the entire amount is Jim's earned income. 2011 income tax Jim and Sharon's earned income limit is the smallest of the following amounts. 2011 income tax   Jim and Sharon's Earned Income Limit   1) Work-related expenses Jim paid $   3,300   2) Jim's earned income $   29,000   3) Income considered earned by Sharon (11 × $250) $    2,750   Jim and Sharon can use $2,750 to figure the credit and treat the balance of $550 ($3,300 − $2,750) as a medical expense. 2011 income tax However, if they use the $3,300 first as a medical expense, they cannot use any part of that amount to figure the credit. 2011 income tax Dollar Limit There is a dollar limit on the amount of your work-related expenses you can use to figure the credit. 2011 income tax This limit is $3,000 for one qualifying person, or $6,000 for two or more qualifying persons. 2011 income tax If you paid work-related expenses for the care of two or more qualifying persons, the applicable dollar limit is $6,000. 2011 income tax This limit does not need to be divided equally among them. 2011 income tax For example, if your work-related expenses for the care of one qualifying person are $3,200 and your work-related expenses for another qualifying person are $2,800, you can use the total, $6,000, when figuring the credit. 2011 income tax Yearly limit. 2011 income tax   The dollar limit is a yearly limit. 2011 income tax The amount of the dollar limit remains the same no matter how long, during the year, you have a qualifying person in your household. 2011 income tax Use the $3,000 limit if you paid work-related expenses for the care of one qualifying person at any time during the year. 2011 income tax Use $6,000 if you paid work-related expenses for the care of more than one qualifying person at any time during the year. 2011 income tax Example 1. 2011 income tax You pay $500 a month for after-school care for your son. 2011 income tax He turned 13 on May 1 and is no longer a qualifying person. 2011 income tax You can use the $2,000 of expenses for his care January through April to figure your credit because it is not more than the $3,000 yearly limit. 2011 income tax Example 2. 2011 income tax In July of this year, to permit your spouse to begin a new job, you enrolled your 3-year-old daughter in a nursery school that provides preschool childcare. 2011 income tax You paid $300 per month for the childcare. 2011 income tax You can use the full $1,800 you paid ($300 × 6 months) as qualified expenses because it is not more than the $3,000 yearly limit. 2011 income tax Reduced Dollar Limit If you received dependent care benefits that you exclude or deduct from your income, you must subtract that amount from the dollar limit that applies to you. 2011 income tax Your reduced dollar limit is figured on Form 2441, Part III. 2011 income tax See Dependent Care Benefits, earlier, for information on excluding or deducting these benefits. 2011 income tax Example 1. 2011 income tax George is a widower with one child and earns $24,000 a year. 2011 income tax He pays work-related expenses of $2,900 for the care of his 4-year-old child and qualifies to claim the credit for child and dependent care expenses. 2011 income tax His employer pays an additional $1,000 under a qualified dependent care benefit plan. 2011 income tax This $1,000 is excluded from George's income. 2011 income tax Although the dollar limit for his work-related expenses is $3,000 (one qualifying person), George figures his credit on only $2,000 of the $2,900 work-related expenses he paid. 2011 income tax This is because his dollar limit is reduced as shown next. 2011 income tax   George's Reduced Dollar Limit 1) Maximum allowable expenses for one qualifying person $3,000 2) Minus: Dependent care benefits George excludes from income −1,000 3) Reduced dollar limit on expenses George can use for the credit $2,000 Example 2. 2011 income tax Randall is married and both he and his wife are employed. 2011 income tax Each has earned income in excess of $6,000. 2011 income tax They have two children, Anne and Andy, ages 2 and 4, who attend a daycare facility licensed and regulated by the state. 2011 income tax Randall's work-related expenses are $6,000 for the year. 2011 income tax Randall's employer has a dependent care assistance program as part of its cafeteria plan, which allows employees to make pre-tax contributions to a dependent care flexible spending arrangement. 2011 income tax Randall has elected to take the maximum $5,000 exclusion from his salary to cover dependent care expenses through this program. 2011 income tax Although the dollar limit for his work-related expenses is $6,000 (two or more qualifying persons), Randall figures his credit on only $1,000 of the $6,000 work-related expense paid. 2011 income tax This is because his dollar limit is reduced as shown next. 2011 income tax   Randall's Reduced Dollar Limit 1) Maximum allowable expenses for two qualifying persons $6,000 2) Minus: Dependent care benefits selected from employer's cafeteria plan and  excluded from Randall's income −5,000 3) Reduced dollar limit on work-related expenses Randall can use for the credit $1,000 Amount of Credit To determine the amount of your credit, multiply your work-related expenses (after applying the earned income and dollar limits) by a percentage. 2011 income tax This percentage depends on your adjusted gross income shown on Form 1040, line 38; Form 1040A, line 22; or Form 1040NR, line 37. 2011 income tax The following table shows the percentage to use based on adjusted gross income. 2011 income tax   IF your adjusted gross income is: THEN the       Over:       But not over:   percentage is:       $0   —   $15,000   35%       15,000   —   17,000   34%       17,000   —   19,000   33%       19,000   —   21,000   32%       21,000   —   23,000   31%       23,000   —   25,000   30%       25,000   —   27,000   29%       27,000   —   29,000   28%       29,000   —   31,000   27%       31,000   —   33,000   26%       33,000   —   35,000   25%       35,000   —   37,000   24%       37,000   —   39,000   23%       39,000   —   41,000   22%       41,000   —   43,000   21%       43,000   —   No limit   20%   To qualify for the credit, you must have one or more qualifying persons. 2011 income tax You should show the expenses for each person on Form 2441, line 2, column (c). 2011 income tax However, it is possible a qualifying person could have no expenses and a second qualifying person could have expenses exceeding $3,000. 2011 income tax You should list -0- for the one person and the actual amount for the second person. 2011 income tax The $6,000 limit that applies to two or more qualifying persons would still be used to compute your credit unless you already excluded or deducted, in Part III of Form 2441, certain dependent care benefits paid to you (or on your behalf) by your employer. 2011 income tax Example. 2011 income tax Roger and Megan Paris have two qualifying children. 2011 income tax They received $1,000 of dependent care benefits from Megan's employer during 2013, but they incurred a total of $19,500 of child and dependent care expenses. 2011 income tax They complete Part III of Form 2441 to exclude the $1,000 from their taxable income (offsetting $1,000 of their expenses). 2011 income tax Roger and Megan continue to line 27 to figure their credit using the remaining $18,500 of expenses. 2011 income tax Line 30 tells them to complete line 2 without including any dependent care benefits. 2011 income tax They complete line 2 of Form 2441, listing both Susan and James, as shown in the Line 2 example above. 2011 income tax Line 2 Example (a) Qualifying person's name (b) Qualifying person's social security number (c) Qualified expenses you incurred and paid in 2013 for the person listed in column (a) First Last Susan Paris 123-00-6789 -0- James Paris 987-00-4321 18,500. 2011 income tax 00 All of Susan's expenses were covered by the $1,000 of employer-provided dependent care benefits. 2011 income tax However, their son James has special needs and they paid $18,500 for his care. 2011 income tax Line 3 imposes a $5,000 limit for two or more children ($6,000 limit, minus $1,000 already excluded from income = $5,000) and Roger and Megan continue to complete the form. 2011 income tax Even though line 2 indicates one of the Paris children did not have any dependent care expenses, it does not change the fact that they had two qualifying children for the purposes of Form 2441. 2011 income tax Payments for prior year's expenses. 2011 income tax   If you had work-related expenses in 2012 that you paid in 2013, you may be able to increase the credit on your 2013 return. 2011 income tax Attach a statement to your form showing how you figured the additional amount from 2012. 2011 income tax Then enter “CPYE” (Credit for Prior Year Expenses) and the amount of the credit on the dotted line next to line 9 on Form 2441. 2011 income tax Also enter the name and taxpayer identification number of the person for whom you paid the prior year's expenses. 2011 income tax Then add this credit to the amount on line 9, and replace the amount on line 9 with the total. 2011 income tax See Worksheet A. 2011 income tax Example. 2011 income tax In 2012, Sam and Kate had childcare expenses of $2,600 for their 12-year-old child. 2011 income tax Of the $2,600, they paid $2,000 in 2012 and $600 in 2013. 2011 income tax Their adjusted gross income for 2012 was $30,000. 2011 income tax Sam's earned income of $14,000 was less than Kate's earned income. 2011 income tax A credit for their 2012 expenses paid in 2013 is not allowed in 2012. 2011 income tax It is allowed for the 2013 tax year, but they must use their adjusted gross income for 2012 to compute the amount. 2011 income tax The filled-in Worksheet A they used to figure this credit is shown later. 2011 income tax Sam and Kate add the $162 from line 13 of this worksheet to their 2013 credit and enter the total on their Form 2441, line 9. 2011 income tax They enter “CPYE $162” and their child's name and SSN in the space to the left of line 9. 2011 income tax Worksheet A. 2011 income tax Worksheet for 2012 Expenses Paid in 2013 Use this worksheet to figure the credit you may claim for 2012 expenses paid in 2013. 2011 income tax 1. 2011 income tax   Enter your 2012 qualified expenses paid in 2012 1. 2011 income tax     2. 2011 income tax   Enter your 2012 qualified expenses paid in 2013 2. 2011 income tax     3. 2011 income tax   Add the amounts on lines 1 and 2 3. 2011 income tax     4. 2011 income tax   Enter $3,000 if care was for one qualifying person ($6,000 if for two or more) 4. 2011 income tax     5. 2011 income tax   Enter any dependent care benefits received for 2012 and excluded from your income (from your 2012 Form 2441, line 25) 5. 2011 income tax     6. 2011 income tax   Subtract the amount on line 5 from the amount on line 4 and enter the result 6. 2011 income tax     7. 2011 income tax   Compare your earned income for 2012 and your spouse's earned income for 2012 and enter the smaller amount 7. 2011 income tax     8. 2011 income tax   Compare the amounts on lines 3, 6, and 7 and enter the smallest amount 8. 2011 income tax     9. 2011 income tax   Enter the amount on which you figured the credit for 2012 (from your 2012 Form 2441, line 6) 9. 2011 income tax     10. 2011 income tax   Subtract the amount on line 9 from the amount on line 8 and enter the result. 2011 income tax If zero or less, stop here. 2011 income tax You cannot increase your 2013 credit by any previous year's expenses 10. 2011 income tax     11. 2011 income tax   Enter your 2012 adjusted gross income (from your 2012 Form 1040, line 38; Form 1040A, line 22; or Form 1040NR, line 37) 11. 2011 income tax     12. 2011 income tax   Find your 2012 adjusted gross income in the table below and enter the corresponding decimal amount here 12. 2011 income tax             IF your 2012 adjusted gross income is:   THEN the decimal                 Over:   But not over:     amount is:                 $0 — $15,000     . 2011 income tax 35                 15,000 — 17,000     . 2011 income tax 34                 17,000 — 19,000     . 2011 income tax 33                 19,000 — 21,000     . 2011 income tax 32                 21,000 — 23,000     . 2011 income tax 31                 23,000 — 25,000     . 2011 income tax 30                 25,000 — 27,000     . 2011 income tax 29                 27,000 — 29,000     . 2011 income tax 28                 29,000 — 31,000     . 2011 income tax 27                 31,000 — 33,000     . 2011 income tax 26                 33,000 — 35,000     . 2011 income tax 25                 35,000 — 37,000     . 2011 income tax 24                 37,000 — 39,000     . 2011 income tax 23                 39,000 — 41,000     . 2011 income tax 22                 41,000 — 43,000     . 2011 income tax 21                 43,000 — No limit     . 2011 income tax 20           13. 2011 income tax   Multiply line 10 by line 12. 2011 income tax Add this amount to your 2013 credit and enter the total on your 2013 Form 2441, line 9. 2011 income tax Enter the following on the dotted line next to line 9 of Form 2441: “CPYE” The amount of this credit for a prior year's expenses           Also, attach a statement to your tax return showing the name and taxpayer identification number of the person for whom you paid the prior year's expenses and how you figured the credit 13. 2011 income tax       Worksheet A. 2011 income tax Filled-in Worksheet for 2012 Expenses Paid in 2013 Use this worksheet to figure the credit you may claim for 2012 expenses paid in 2013. 2011 income tax 1. 2011 income tax   Enter your 2012 qualified expenses paid in 2012 1. 2011 income tax   $2,000 2. 2011 income tax   Enter your 2012 qualified expenses paid in 2013 2. 2011 income tax   600 3. 2011 income tax   Add the amounts on lines 1 and 2 3. 2011 income tax   2,600 4. 2011 income tax   Enter $3,000 if care was for one qualifying person ($6,000 if for two or more) 4. 2011 income tax   3,000 5. 2011 income tax   Enter any dependent care benefits received for 2012 and excluded from your income (from your 2012 Form 2441, line 25) 5. 2011 income tax   0 6. 2011 income tax   Subtract the amount on line 5 from the amount on line 4 and enter the result 6. 2011 income tax   3,000 7. 2011 income tax   Compare your earned income for 2012 and your spouse's earned income for 2012 and enter the smaller amount 7. 2011 income tax   14,000 8. 2011 income tax   Compare the amounts on lines 3, 6, and 7 and enter the smallest amount 8. 2011 income tax   2,600 9. 2011 income tax   Enter the amount on which you figured the credit for 2012 (from your 2012 Form 2441, line 6) 9. 2011 income tax   2,000 10. 2011 income tax   Subtract the amount on line 9 from the amount on line 8 and enter the result. 2011 income tax If zero or less, stop here. 2011 income tax You cannot increase your 2013 credit by any previous year's expenses 10. 2011 income tax   600 11. 2011 income tax   Enter your 2012 adjusted gross income (from your 2012 Form 1040, line 38; Form 1040A, line 22; or Form 1040NR, line 37) 11. 2011 income tax   30,000 12. 2011 income tax   Find your 2012 adjusted gross income in the table below and enter the corresponding decimal amount here 12. 2011 income tax   . 2011 income tax 27         IF your 2012 adjusted gross income is:   THEN the decimal                 Over   But not over     amount is:                 $0 — $15,000     . 2011 income tax 35                 15,000 — 17,000     . 2011 income tax 34                 17,000 — 19,000     . 2011 income tax 33                 19,000 — 21,000     . 2011 income tax 32                 21,000 — 23,000     . 2011 income tax 31                 23,000 — 25,000     . 2011 income tax 30                 25,000 — 27,000     . 2011 income tax 29                 27,000 — 29,000     . 2011 income tax 28                 29,000 — 31,000     . 2011 income tax 27                 31,000 — 33,000     . 2011 income tax 26                 33,000 — 35,000     . 2011 income tax 25                 35,000 — 37,000     . 2011 income tax 24                 37,000 — 39,000     . 2011 income tax 23                 39,000 — 41,000     . 2011 income tax 22                 41,000 — 43,000     . 2011 income tax 21                 43,000 — No limit     . 2011 income tax 20           13. 2011 income tax   Multiply line 10 by line 12. 2011 income tax Add this amount to your 2013 credit and enter the total on your 2013 Form 2441, line 9. 2011 income tax Enter the following on the dotted line next to line 9 of Form 2441: “CPYE” The amount of this credit for a prior year's expenses             Also, attach a statement to your tax return showing the name and taxpayer identification number of the person for whom you paid the prior year's expenses and how you figured the credit 13. 2011 income tax   $162   How To Claim the Credit To claim the credit, you can file Form 1040, Form 1040A, or Form 1040NR. 2011 income tax You cannot claim the credit on Form 1040EZ or Form 1040NR-EZ. 2011 income tax Form 1040, Form 1040A, or Form 1040NR. 2011 income tax    You must complete Form 2441 and attach it to your Form 1040, Form 1040A, or Form 1040NR. 2011 income tax Enter the credit on your Form 1040, line 48; Form 1040A, line 29; or Form 1040NR, line 46. 2011 income tax Limit on credit. 2011 income tax    The amount of credit you can claim is limited to your tax. 2011 income tax For more information, see the Instructions for Form 2441. 2011 income tax Tax credit not refundable. 2011 income tax   You cannot get a refund for any part of the credit that is more than this limit. 2011 income tax Recordkeeping. 2011 income tax You should keep records of your work-related expenses. 2011 income tax Also, if your dependent or spouse is not able to care for himself or herself, your records should show both the nature and length of the disability. 2011 income tax Other records you should keep to support your claim for the credit are described under Provider Identification Test, earlier. 2011 income tax Employment Taxes for Household Employers If you pay someone to come to your home and care for your dependent or spouse, you may be a household employer. 2011 income tax If you are a household employer, you will need an employer identification number (EIN) and you may have to pay employment taxes. 2011 income tax If the individuals who work in your home are self-employed, you are not liable for any of the taxes discussed in this section. 2011 income tax Self-employed persons who are in business for themselves are not household employees. 2011 income tax Usually, you are not a household employer if the person who cares for your dependent or spouse does so at his or her home or place of business. 2011 income tax If you use a placement agency that exercises control over what work is done and how it will be done by a babysitter or companion who works in your home, the worker is not your employee. 2011 income tax This control could include providing rules of conduct and appearance and requiring regular reports. 2011 income tax In this case, you do not have to pay employment taxes. 2011 income tax But, if an agency merely gives you a list of sitters and you hire one from that list, and pay the sitter directly, the sitter may be your employee. 2011 income tax If you have a household employee, you may be subject to: Social security and Medicare taxes, Federal unemployment tax, and Federal income tax withholding. 2011 income tax Social security and Medicare taxes are generally withheld from the employee's pay and matched by the employer. 2011 income tax Federal unemployment (FUTA) tax is paid by the employer only and provides for payments of unemployment compensation to workers who have lost their jobs. 2011 income tax Federal income tax is withheld from the employee's total pay if the employee asks you to do so and you agree. 2011 income tax For more information on a household employer's tax responsibilities, see Publication 926 and Schedule H (Form 1040) and its instructions. 2011 income tax State employment tax. 2011 income tax   You may also have to pay state unemployment tax. 2011 income tax Contact your state unemployment tax office for information. 2011 income tax You should also find out whether you need to pay or collect other state employment taxes or carry worker's compensation insurance. 2011 income tax For a list of state unemployment tax agencies, visit the U. 2011 income tax S. 2011 income tax Department of Labor's website. 2011 income tax To find that website, use the link in Publication 926 or search online. 2011 income tax How To Get Tax Help Whether it's help with a tax issue, preparing your tax return or a need for a free publication or form, get the help you need the way you want it: online, use a smart phone, call or walk in to an IRS office or volunteer site near you. 2011 income tax Free help with your tax return. 2011 income tax   You can get free help preparing your return nationwide from IRS-certified volunteers. 2011 income tax The Volunteer Income Tax Assistance (VITA) program helps low-to-moderate income, elderly, people with disabilities, and limited English proficient taxpayers. 2011 income tax The Tax Counseling for the Elderly (TCE) program helps taxpayers age 60 and older with their tax returns. 2011 income tax Most VITA and TCE sites offer free electronic filing and all volunteers will let you know about credits and deductions you may be entitled to claim. 2011 income tax In addition, some VITA and TCE sites provide taxpayers the opportunity to prepare their own return with help from an IRS-certified volunteer. 2011 income tax To find the nearest VITA or TCE site, you can use the VITA Locator Tool on IRS. 2011 income tax gov, download the IRS2Go app, or call 1-800-906-9887. 2011 income tax   As part of the TCE program, AARP offers the Tax-Aide counseling program. 2011 income tax To find the nearest AARP Tax-Aide site, visit AARP's website at www. 2011 income tax aarp. 2011 income tax org/money/taxaide or call 1-888-227-7669. 2011 income tax For more information on these programs, go to IRS. 2011 income tax gov and enter “VITA” in the search box. 2011 income tax Internet. 2011 income tax    IRS. 2011 income tax gov and IRS2Go are ready when you are —24 hours a day, 7 days a week. 2011 income tax Download the free IRS2Go app from the iTunes app store or from Google Play. 2011 income tax Use it to check your refund status, order transcripts of your tax returns or tax account, watch the IRS YouTube channel, get IRS news as soon as it's released to the public, subscribe to filing season updates or daily tax tips, and follow the IRS Twitter news feed, @IRSnews, to get the latest federal tax news, including information about tax law changes and important IRS programs. 2011 income tax Check the status of your 2013 refund with the Where's My Refund? application on IRS. 2011 income tax gov or download the IRS2Go app and select the Refund Status option. 2011 income tax The IRS issues more than 9 out of 10 refunds in less than 21 days. 2011 income tax Using these applications, you can start checking on the status of your return within 24 hours after we receive your e-filed return or 4 weeks after you mail a paper return. 2011 income tax You will also be given a personalized refund date as soon as the IRS processes your tax return and approves your refund. 2011 income tax The IRS updates Where's My Refund? every 24 hours, usually overnight, so you only need to check once a day. 2011 income tax Use the Interactive Tax Assistant (ITA) to research your tax questions. 2011 income tax No need to wait on the phone or stand in line. 2011 income tax The ITA is available 24 hours a day, 7 days a week, and provides you with a variety of tax information related to general filing topics, deductions, credits, and income. 2011 income tax When you reach the response screen, you can print the entire interview and the final response for your records. 2011 income tax New subject areas are added on a regular basis. 2011 income tax  Answers not provided through ITA may be found in Tax Trails, one of the Tax Topics on IRS. 2011 income tax gov which contain general individual and business tax information or by searching the IRS Tax Map, which includes an international subject index. 2011 income tax You can use the IRS Tax Map, to search publications and instructions by topic or keyword. 2011 income tax The IRS Tax Map integrates forms and publications into one research tool and provides single-point access to tax law information by subject. 2011 income tax When the user searches the IRS Tax Map, they will be provided with links to related content in existing IRS publications, forms and instructions, questions and answers, and Tax Topics. 2011 income tax Coming this filing season, you can immediately view and print for free all 5 types of individual federal tax transcripts (tax returns, tax account, record of account, wage and income statement, and certification of non-filing) using Get Transcript. 2011 income tax You can also ask the IRS to mail a return or an account transcript to you. 2011 income tax Only the mail option is available by choosing the Tax Records option on the IRS2Go app by selecting Mail Transcript on IRS. 2011 income tax gov or by calling 1-800-908-9946. 2011 income tax Tax return and tax account transcripts are generally available for the current year and the past three years. 2011 income tax Determine if you are eligible for the EITC and estimate the amount of the credit with the Earned Income Tax Credit (EITC) Assistant. 2011 income tax Visit Understanding Your IRS Notice or Letter to get answers to questions about a notice or letter you received from the IRS. 2011 income tax If you received the First Time Homebuyer Credit, you can use the First Time Homebuyer Credit Account Look-up tool for information on your repayments and account balance. 2011 income tax Check the status of your amended return using Where's My Amended Return? Go to IRS. 2011 income tax gov and enter Where's My Amended Return? in the search box. 2011 income tax You can generally expect your amended return to be processed up to 12 weeks from the date we receive it. 2011 income tax It can take up to 3 weeks from the date you mailed it to show up in our system. 2011 income tax Make a payment using one of several safe and convenient electronic payment options available on IRS. 2011 income tax gov. 2011 income tax Select the Payment tab on the front page of IRS. 2011 income tax gov for more information. 2011 income tax Determine if you are eligible and apply for an online payment agreement, if you owe more tax than you can pay today. 2011 income tax Figure your income tax withholding with the IRS Withholding Calculator on IRS. 2011 income tax gov. 2011 income tax Use it if you've had too much or too little withheld, your personal situation has changed, you're starting a new job or you just want to see if you're having the right amount withheld. 2011 income tax Determine if you might be subject to the Alternative Minimum Tax by using the Alternative Minimum Tax Assistant on IRS. 2011 income tax gov. 2011 income tax Request an Electronic Filing PIN by going to IRS. 2011 income tax gov and entering Electronic Filing PIN in the search box. 2011 income tax Download forms, instructions and publications, including accessible versions for people with disabilities. 2011 income tax Locate the nearest Taxpayer Assistance Center (TAC) using the Office Locator tool on IRS. 2011 income tax gov, or choose the Contact Us option on the IRS2Go app and search Local Offices. 2011 income tax An employee can answer questions about your tax account or help you set up a payment plan. 2011 income tax Before you visit, check the Office Locator on IRS. 2011 income tax gov, or Local Offices under Contact Us on IRS2Go to confirm the address, phone number, days and hours of operation, and the services provided. 2011 income tax If you have a special need, such as a disability, you can request an appointment. 2011 income tax Call the local number listed in the Office Locator, or look in the phone book under Unit