Filing Your Taxes Online is Fast, Easy and Secure.
Start now and receive your tax refund in as little as 7 days.

1. Get Answers

Your online questions are customized to your unique tax situation.

2. Maximize your Refund

Find tax credits for everything from school tuition to buying a hybri

3. E-File for FREE

E-file free with direct deposit to get your refund in as few as 7 days.

Filing your taxes with paper mail can be difficult and it could take weeks for your refund to arrive. IRS e-file is easy, fast and secure. There is no paperwork going to the IRS so tax refunds can be processed in as little as 7 days with direct deposit. As you prepare your taxes online, you can see your tax refund in real time.

FREE audit support and representation from an enrolled agent – NEW and only from H&R Block

Can I Still E File 2011 Taxes

Tax Planning Us 1040aMilitary Tax Free Zones2012 Tax Return Instructions2011 Tax Form 1040ezFile Taxes For FreeIrs TaxFree Online State Tax Filing Only1040x Tax FormTax Forms 20071040 For 20102010 Tax Return2012 990 Tax FormsH & R Block Free File OnlineH&r Block 1040ezTurbo State Tax FreeHow Do I File An Amended Tax ReturnFile 2011 TaxIrs 1040ez InstructionsIrs Form 1040ez 2014Irs Tax Form 1040ezTurbotax 2010 SoftwareIrs Free Efile2011 1040ez FormFile Prior Year Taxes OnlineEfile H&r Block1040ez Tax Forms1040x File Online10ezFile 2010 Tax ReturnNeed To File 2010 TaxesFile My 2009 Taxes Online Free1040 2012 Tax FormCheapest State Tax FilingE File Tax Return1040ez Form And InstructionsIrs 1040ez 2012Free Tax Filing H&r BlockFile My 2010 TaxesWhere Can I Find State Tax FormsFiling 2011 Taxes For Free

Can I Still E File 2011 Taxes

Can i still e file 2011 taxes Publication 970 - Introductory Material Table of Contents Future Developments What's New Reminders IntroductionComparison table. Can i still e file 2011 taxes Ordering forms and publications. Can i still e file 2011 taxes Tax questions. Can i still e file 2011 taxes Useful Items - You may want to see: Future Developments For the latest information about developments related to Publication 970, such as legislation enacted after it was published, go to www. Can i still e file 2011 taxes irs. Can i still e file 2011 taxes gov/pub970. Can i still e file 2011 taxes What's New Lifetime learning credit. Can i still e file 2011 taxes  For 2013, the amount of your lifetime learning credit is gradually reduced (phased out) if your modified adjusted gross income (MAGI) is between $53,000 and $63,000 ($107,000 and $127,000 if you file a joint return). Can i still e file 2011 taxes You cannot claim a credit if your MAGI is $63,000 or more ($127,000 or more if you file a joint return). Can i still e file 2011 taxes This is an increase from the 2012 limits of $52,000 and $62,000 ($104,000 and $124,000 if filing a joint return). Can i still e file 2011 taxes For more information, see chapter 3, Lifetime Learning Credit . Can i still e file 2011 taxes Business deduction for work-related education. Can i still e file 2011 taxes  For 2013, if you drive your car to and from school and qualify to deduct transportation expenses, the amount you can deduct for miles driven from January 1, 2013 through December 31, 2013 is 56. Can i still e file 2011 taxes 5 cents per mile. Can i still e file 2011 taxes See chapter 12, Business Deduction for Work-Related Education , for more information. Can i still e file 2011 taxes Reminders Form 1098-T, Tuition Statement. Can i still e file 2011 taxes  When figuring an education credit or the tuition and fees deduction, use only the amounts you paid and are deemed to have paid during the tax year for qualified education expenses. Can i still e file 2011 taxes In most cases, the student should receive Form 1098-T from the eligible educational institution by January 31, 2014. Can i still e file 2011 taxes An institution my choose to report either payments received during calendar year 2013 (box 1), or amounts billed during the calendar year 2013 (box 2), for qualified education expenses. Can i still e file 2011 taxes However, the amounts in boxes 1 and 2 of Form 1098-T might be different than the amount you actually paid and are deemed to have paid. Can i still e file 2011 taxes In addition, the Form 1098-T should give you other information for that institution, such as adjustments made for prior years, the amount of scholarships or grants, reimbursements, or refunds, and whether the student was enrolled at least half-time or was a graduate student. Can i still e file 2011 taxes The eligible educational institution may ask for a completed Form W-9S, Request for Student's or Borrower's Taxpayer Identification Number and Certification, or similar statement to obtain the student's name, address, and taxpayer identification number. Can i still e file 2011 taxes Hope Scholarship Credit. Can i still e file 2011 taxes  For 2013, the Hope Scholarship Credit is not available. Can i still e file 2011 taxes However, you may be able to claim an American opportunity or lifetime learning credit. Can i still e file 2011 taxes See chapter 2, American Opportunity Credit , and chapter 3, Lifetime Learning Credit , for more information. Can i still e file 2011 taxes Estimated tax payments. Can i still e file 2011 taxes  If you have taxable income from any of your education benefits and the payer does not withhold enough income tax, you may need to make estimated tax payments. Can i still e file 2011 taxes For more information, see Publication 505, Tax Withholding and Estimated Tax. Can i still e file 2011 taxes Photographs of missing children. Can i still e file 2011 taxes  The Internal Revenue Service is a proud partner with the National Center for Missing and Exploited Children. Can i still e file 2011 taxes Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. Can i still e file 2011 taxes You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child. Can i still e file 2011 taxes Introduction This publication explains tax benefits that may be available to you if you are saving for or paying education costs for yourself or, in many cases, another student who is a member of your immediate family. Can i still e file 2011 taxes Most benefits apply only to higher education. Can i still e file 2011 taxes What is in this publication. Can i still e file 2011 taxes    Chapter 1, Scholarships, Fellowships, Grants, and Tuition Reductions , explains the tax treatment of various types of educational assistance, including scholarships, fellowships, and tuition reductions. Can i still e file 2011 taxes   Two tax credits for which you may be eligible are explained in chapter 2, American Opportunity Credit , and chapter 3, Lifetime Learning Credit . Can i still e file 2011 taxes These benefits, which reduce the amount of income tax you may have to pay, are: The American opportunity credit, and The lifetime learning credit. Can i still e file 2011 taxes    Ten other types of benefits are explained in chapters 4 through 12. Can i still e file 2011 taxes These benefits, which reduce the amount of income tax you may have to pay, are: Deduct student loan interest; Receive tax-free treatment of a canceled student loan; Receive tax-free student loan repayment assistance; Deduct tuition and fees for education; Establish and contribute to a Coverdell education savings account (ESA), which features tax-free earnings; Participate in a qualified tuition program (QTP), which features tax-free earnings; Take early distributions from any type of individual retirement arrangement (IRA) for education costs without paying the 10% additional tax on early distributions; Cash in savings bonds for education costs without having to pay tax on the interest; Receive tax-free educational benefits from your employer; and Take a business deduction for work-related education. Can i still e file 2011 taxes Note. Can i still e file 2011 taxes You generally cannot claim more than one of the benefits described in the list above for the same qualifying education expense. Can i still e file 2011 taxes Comparison table. Can i still e file 2011 taxes   Some of the features of these benefits are highlighted in Appendix B, Highlights of Education Tax Benefits for Tax Year 2013 , later, in this publication. Can i still e file 2011 taxes This general comparison table may guide you in determining which benefits you may be eligible for and which chapters you may want to read. Can i still e file 2011 taxes When you figure your taxes, you may want to compare these tax benefits so you can choose the method(s) that gives you the lowest tax liability. Can i still e file 2011 taxes If you qualify, you may find that a combination of credit(s) and deduction(s) gives you the lowest tax. Can i still e file 2011 taxes Analyzing your tax withholding. Can i still e file 2011 taxes   After you estimate your education tax benefits for the year, you may be able to reduce the amount of your federal income tax withholding. Can i still e file 2011 taxes Also, you may want to recheck your withholding during the year if your personal or financial situation changes. Can i still e file 2011 taxes See Publication 919, How Do I Adjust My Tax Withholding, for more information. Can i still e file 2011 taxes Glossary. Can i still e file 2011 taxes   In this publication, wherever appropriate, we have tried to use the same or similar terminology when referring to the basic components of each education benefit. Can i still e file 2011 taxes Some of the terms used are: Qualified education expenses, Eligible educational institution, and Modified adjusted gross income. Can i still e file 2011 taxes   Even though the same term, such as qualified education expenses, is used to label a basic component of many of the education benefits, the same expenses are not necessarily allowed for each benefit. Can i still e file 2011 taxes For example, the cost of room and board is a qualified education expense for the qualified tuition program, but not for the education savings bond program. Can i still e file 2011 taxes   Many of the terms used in the publication are defined in the glossary near the end of the publication. Can i still e file 2011 taxes The glossary is not intended to be a substitute for reading the chapter on a particular education benefit, but it will give you an overview of how certain terms are used in discussing the different benefits. Can i still e file 2011 taxes Comments and suggestions. Can i still e file 2011 taxes   We welcome your comments about this publication and your suggestions for future editions. Can i still e file 2011 taxes   You can write to us at the following address: Internal Revenue Service Tax Forms and Publications Division 1111 Constitution Ave. Can i still e file 2011 taxes NW, IR-6526 Washington, DC 20224   We respond to many letters by telephone. Can i still e file 2011 taxes Therefore, it would be helpful if you would include your daytime phone number, including the area code, in your correspondence. Can i still e file 2011 taxes   You can send your comments from www. Can i still e file 2011 taxes irs. Can i still e file 2011 taxes gov/formspubs/. Can i still e file 2011 taxes Click on “More Information” and then on “Comment on Tax Forms and Publications”. Can i still e file 2011 taxes   Although we cannot respond individually to each comment received, we do appreciate your feedback and will consider your comments as we revise our tax products. Can i still e file 2011 taxes Ordering forms and publications. Can i still e file 2011 taxes   Visit www. Can i still e file 2011 taxes irs. Can i still e file 2011 taxes gov/formspubs/ to download forms and publications, call 1-800-TAX-FORM (1-800-829-3676), or write to the address below and receive a response within 10 days after your request is received. Can i still e file 2011 taxes Internal Revenue Service 1201 N. Can i still e file 2011 taxes Mitsubishi Motorway Bloomington, IL 61705-6613 Tax questions. Can i still e file 2011 taxes   If you have a tax question, check the information available on IRS. Can i still e file 2011 taxes gov or call 1-800-829-1040. Can i still e file 2011 taxes We cannot answer tax questions sent to either of the above addresses. Can i still e file 2011 taxes Useful Items - You may want to see: Publication 463 Travel, Entertainment, Gift, and Car Expenses 525 Taxable and Nontaxable Income 550 Investment Income and Expenses 590 Individual Retirement Arrangements (IRAs) Form (and Instructions) 1040 U. Can i still e file 2011 taxes S. Can i still e file 2011 taxes Individual Income Tax Return 1040A U. Can i still e file 2011 taxes S. Can i still e file 2011 taxes Individual Income Tax Return 1040EZ Income Tax Return for Single and Joint Filers With No Dependents 1040NR U. Can i still e file 2011 taxes S. Can i still e file 2011 taxes Nonresident Alien Income Tax Return 1040NR-EZ U. Can i still e file 2011 taxes S. Can i still e file 2011 taxes Income Tax Return for Certain Nonresident Aliens With No Dependents 2106 Employee Business Expenses 2106-EZ Unreimbursed Employee Business Expenses 5329 Additional Taxes on Qualified Plans and Other Tax-Favored Accounts 8815 Exclusion of Interest From Series EE and I U. Can i still e file 2011 taxes S. Can i still e file 2011 taxes Savings Bonds Issued After 1989 8863 Education Credits 8917 Tuition and Fees Deduction Schedule A (Form 1040) Itemized Deductions  See chapter 13, How To Get Tax Help , for information about getting these publications and forms. Can i still e file 2011 taxes Prev  Up  Next   Home   More Online Publications
Print - Click this link to Print this page

Understanding your CP49 Notice

We sent you this notice to tell you we used all or part of your refund to pay a tax debt.


What you need to do

  • Read your notice carefully — it'll explain how we used your refund.
  • Contact us if you disagree.

You may want to...


Answers to Common Questions

What should I do if I disagree with the notice?
Call us at the toll free number on the top right corner of your notice. Please have your paperwork (such as cancelled checks, amended return, etc.) ready when you call.

Part of the refund you used is mine. You used it to pay taxes my spouse owes. I don't owe any taxes. What can I do?
You can file a Form 8379, Injured Spouse Allocation to claim your share of the refund.

You only used part of my refund. What happens to the part you didn't use?
You'll receive a refund check for any part we didn't use.

What happens when the refund you used didn't pay the full amount I owe and I can't pay the rest?
You can make a payment plan with us when you can't pay the full amount you owe.

How can I make a payment plan?
Call us at the toll free number on the top right corner of your notice to talk about payment plans or learn more about them.


Tips for next year

Consider filing your taxes electronically. Filing online can help you avoid mistakes and find credits and deductions that you may qualify for. In many cases you can file for free. Learn more about e-file.

Printable samples of this notice (PDF)

Tax publications you may find useful

How to get help

Calling the 1-800 number listed on the top right corner of your notice is the fastest way to get your questions answered.

You can also authorize someone (such as an accountant) to contact the IRS on your behalf using this Power of Attorney and Declaration of Representative (Form 2848).

Or you may qualify for help from a Low Income Taxpayer Clinic.
 

Page Last Reviewed or Updated: 04-Mar-2014

The Can I Still E File 2011 Taxes

Can i still e file 2011 taxes 1. Can i still e file 2011 taxes   Deducting Business Expenses Table of Contents What's New Introduction Topics - This chapter discusses: Useful Items - You may want to see: What Can I Deduct?Cost of Goods Sold Capital Expenses Capital versus Deductible Expenses Personal versus Business Expenses How Much Can I Deduct?Not-for-profit limits. Can i still e file 2011 taxes At-risk limits. Can i still e file 2011 taxes Passive activities. Can i still e file 2011 taxes Net operating loss. Can i still e file 2011 taxes When Can I Deduct an Expense?Economic performance. Can i still e file 2011 taxes Not-for-Profit ActivitiesGross Income Limit on Deductions What's New Optional safe harbor method to determine the business use of a home deduction. Can i still e file 2011 taxes  Beginning in 2013, you can use the optional safe harbor method to determine the deduction for the business use of your home. Can i still e file 2011 taxes See Optional safe harbor method under Business use of your home , later. Can i still e file 2011 taxes Introduction This chapter covers the general rules for deducting business expenses. Can i still e file 2011 taxes Business expenses are the costs of carrying on a trade or business, and they are usually deductible if the business is operated to make a profit. Can i still e file 2011 taxes Topics - This chapter discusses: What you can deduct How much you can deduct When you can deduct Not-for-profit activities Useful Items - You may want to see: Publication 334 Tax Guide for Small Business 463 Travel, Entertainment, Gift, and Car Expenses 525 Taxable and Nontaxable Income 529 Miscellaneous Deductions 536 Net Operating Losses (NOLs) for Individuals, Estates, and Trusts 538 Accounting Periods and Methods 542 Corporations 547 Casualties, Disasters, and Thefts 587 Business Use of Your Home 925 Passive Activity and At-Risk Rules 936 Home Mortgage Interest Deduction 946 How To Depreciate Property Form (and Instructions) Sch A (Form 1040) Itemized Deductions 5213 Election To Postpone Determination as To Whether the Presumption Applies That an Activity Is Engaged in for Profit See chapter 12 for information about getting publications and forms. Can i still e file 2011 taxes What Can I Deduct? To be deductible, a business expense must be both ordinary and necessary. Can i still e file 2011 taxes An ordinary expense is one that is common and accepted in your industry. Can i still e file 2011 taxes A necessary expense is one that is helpful and appropriate for your trade or business. Can i still e file 2011 taxes An expense does not have to be indispensable to be considered necessary. Can i still e file 2011 taxes Even though an expense may be ordinary and necessary, you may not be allowed to deduct the expense in the year you paid or incurred it. Can i still e file 2011 taxes In some cases you may not be allowed to deduct the expense at all. Can i still e file 2011 taxes Therefore, it is important to distinguish usual business expenses from expenses that include the following. Can i still e file 2011 taxes The expenses used to figure cost of goods sold, Capital expenses, and Personal expenses. Can i still e file 2011 taxes Cost of Goods Sold If your business manufactures products or purchases them for resale, you generally must value inventory at the beginning and end of each tax year to determine your cost of goods sold. Can i still e file 2011 taxes Some of your business expenses may be included in figuring cost of goods sold. Can i still e file 2011 taxes Cost of goods sold is deducted from your gross receipts to figure your gross profit for the year. Can i still e file 2011 taxes If you include an expense in the cost of goods sold, you cannot deduct it again as a business expense. Can i still e file 2011 taxes The following are types of expenses that go into figuring cost of goods sold. Can i still e file 2011 taxes The cost of products or raw materials, including freight. Can i still e file 2011 taxes Storage. Can i still e file 2011 taxes Direct labor (including contributions to pension or annuity plans) for workers who produce the products. Can i still e file 2011 taxes Factory overhead. Can i still e file 2011 taxes Under the uniform capitalization rules, you must capitalize the direct costs and part of the indirect costs for certain production or resale activities. Can i still e file 2011 taxes Indirect costs include rent, interest, taxes, storage, purchasing, processing, repackaging, handling, and administrative costs. Can i still e file 2011 taxes This rule does not apply to personal property you acquire for resale if your average annual gross receipts (or those of your predecessor) for the preceding 3 tax years are not more than $10 million. Can i still e file 2011 taxes For more information, see the following sources. Can i still e file 2011 taxes Cost of goods sold—chapter 6 of Publication 334. Can i still e file 2011 taxes Inventories—Publication 538. Can i still e file 2011 taxes Uniform capitalization rules—Publication 538 and section 263A of the Internal Revenue Code and the related regulations. Can i still e file 2011 taxes Capital Expenses You must capitalize, rather than deduct, some costs. Can i still e file 2011 taxes These costs are a part of your investment in your business and are called “capital expenses. Can i still e file 2011 taxes ” Capital expenses are considered assets in your business. Can i still e file 2011 taxes In general, you capitalize three types of costs. Can i still e file 2011 taxes Business start-up costs (See Tip below). Can i still e file 2011 taxes Business assets. Can i still e file 2011 taxes Improvements. Can i still e file 2011 taxes You can elect to deduct or amortize certain business start-up costs. Can i still e file 2011 taxes See chapters 7 and 8. Can i still e file 2011 taxes Cost recovery. Can i still e file 2011 taxes   Although you generally cannot take a current deduction for a capital expense, you may be able to recover the amount you spend through depreciation, amortization, or depletion. Can i still e file 2011 taxes These recovery methods allow you to deduct part of your cost each year. Can i still e file 2011 taxes In this way, you are able to recover your capital expense. Can i still e file 2011 taxes See Amortization (chapter 8) and Depletion (chapter 9) in this publication. Can i still e file 2011 taxes A taxpayer can elect to deduct a portion of the costs of certain depreciable property as a section 179 deduction. Can i still e file 2011 taxes A greater portion of these costs can be deducted if the property is qualified disaster assistance property. Can i still e file 2011 taxes See Publication 946 for details. Can i still e file 2011 taxes Going Into Business The costs of getting started in business, before you actually begin business operations, are capital expenses. Can i still e file 2011 taxes These costs may include expenses for advertising, travel, or wages for training employees. Can i still e file 2011 taxes If you go into business. Can i still e file 2011 taxes   When you go into business, treat all costs you had to get your business started as capital expenses. Can i still e file 2011 taxes   Usually you recover costs for a particular asset through depreciation. Can i still e file 2011 taxes Generally, you cannot recover other costs until you sell the business or otherwise go out of business. Can i still e file 2011 taxes However, you can choose to amortize certain costs for setting up your business. Can i still e file 2011 taxes See Starting a Business in chapter 8 for more information on business start-up costs. Can i still e file 2011 taxes If your attempt to go into business is unsuccessful. Can i still e file 2011 taxes   If you are an individual and your attempt to go into business is not successful, the expenses you had in trying to establish yourself in business fall into two categories. Can i still e file 2011 taxes The costs you had before making a decision to acquire or begin a specific business. Can i still e file 2011 taxes These costs are personal and nondeductible. Can i still e file 2011 taxes They include any costs incurred during a general search for, or preliminary investigation of, a business or investment possibility. Can i still e file 2011 taxes The costs you had in your attempt to acquire or begin a specific business. Can i still e file 2011 taxes These costs are capital expenses and you can deduct them as a capital loss. Can i still e file 2011 taxes   If you are a corporation and your attempt to go into a new trade or business is not successful, you may be able to deduct all investigatory costs as a loss. Can i still e file 2011 taxes   The costs of any assets acquired during your unsuccessful attempt to go into business are a part of your basis in the assets. Can i still e file 2011 taxes You cannot take a deduction for these costs. Can i still e file 2011 taxes You will recover the costs of these assets when you dispose of them. Can i still e file 2011 taxes Business Assets There are many different kinds of business assets; for example, land, buildings, machinery, furniture, trucks, patents, and franchise rights. Can i still e file 2011 taxes You must fully capitalize the cost of these assets, including freight and installation charges. Can i still e file 2011 taxes Certain property you produce for use in your trade or business must be capitalized under the uniform capitalization rules. Can i still e file 2011 taxes See Regulations section 1. Can i still e file 2011 taxes 263A-2 for information on these rules. Can i still e file 2011 taxes Improvements Improvements are generally major expenditures. Can i still e file 2011 taxes Some examples are: new electric wiring, a new roof, a new floor, new plumbing, bricking up windows to strengthen a wall, and lighting improvements. Can i still e file 2011 taxes The costs of making improvements to a business asset are capital expenses if the improvements add to the value of the asset, appreciably lengthen the time you can use it, or adapt it to a different use. Can i still e file 2011 taxes Beginning in 2014, you must capitalize as improvements costs that are for the betterment of a unit of property, restore the unit of property, or adapt the unit of property to a new or different use. Can i still e file 2011 taxes Temporary regulations allow you to capitalize costs meeting the above criteria for tax years beginning after 2011. Can i still e file 2011 taxes However, you can currently deduct repairs that keep your property in a normal efficient operating condition as a business expense. Can i still e file 2011 taxes Treat as repairs amounts paid to replace parts of a machine that only keep it in a normal operating condition. Can i still e file 2011 taxes Restoration plan. Can i still e file 2011 taxes   Capitalize the cost of reconditioning, improving, or altering your property as part of a general restoration plan to make it suitable for your business. Can i still e file 2011 taxes This applies even if some of the work would by itself be classified as repairs. Can i still e file 2011 taxes Capital versus Deductible Expenses To help you distinguish between capital and deductible expenses, different examples are given below. Can i still e file 2011 taxes Motor vehicles. Can i still e file 2011 taxes   You usually capitalize the cost of a motor vehicle you use in your business. Can i still e file 2011 taxes You can recover its cost through annual deductions for depreciation. Can i still e file 2011 taxes   There are dollar limits on the depreciation you can claim each year on passenger automobiles used in your business. Can i still e file 2011 taxes See Publication 463. Can i still e file 2011 taxes   Generally, repairs you make to your business vehicle are currently deductible. Can i still e file 2011 taxes However, amounts you pay to recondition and overhaul a business vehicle are capital expenses and are recovered through depreciation. Can i still e file 2011 taxes Roads and driveways. Can i still e file 2011 taxes    The cost of building a private road on your business property and the cost of replacing a gravel driveway with a concrete one are capital expenses you may be able to depreciate. Can i still e file 2011 taxes The cost of maintaining a private road on your business property is a deductible expense. Can i still e file 2011 taxes Tools. Can i still e file 2011 taxes   Unless the uniform capitalization rules apply, amounts spent for tools used in your business are deductible expenses if the tools have a life expectancy of less than 1 year or their cost is minor. Can i still e file 2011 taxes Machinery parts. Can i still e file 2011 taxes   Unless the uniform capitalization rules apply, the cost of replacing short-lived parts of a machine to keep it in good working condition, but not add to its life, is a deductible expense. Can i still e file 2011 taxes Heating equipment. Can i still e file 2011 taxes   The cost of changing from one heating system to another is a capital expense. Can i still e file 2011 taxes Personal versus Business Expenses Generally, you cannot deduct personal, living, or family expenses. Can i still e file 2011 taxes However, if you have an expense for something that is used partly for business and partly for personal purposes, divide the total cost between the business and personal parts. Can i still e file 2011 taxes You can deduct the business part. Can i still e file 2011 taxes For example, if you borrow money and use 70% of it for business and the other 30% for a family vacation, you generally can deduct 70% of the interest as a business expense. Can i still e file 2011 taxes The remaining 30% is personal interest and generally is not deductible. Can i still e file 2011 taxes See chapter 4 for information on deducting interest and the allocation rules. Can i still e file 2011 taxes Business use of your home. Can i still e file 2011 taxes   If you use part of your home for business, you may be able to deduct expenses for the business use of your home. Can i still e file 2011 taxes These expenses may include mortgage interest, insurance, utilities, repairs, and depreciation. Can i still e file 2011 taxes   To qualify to claim expenses for the business use of your home, you must meet both of the following tests. Can i still e file 2011 taxes The business part of your home must be used exclusively and regularly for your trade or business. Can i still e file 2011 taxes The business part of your home must be: Your principal place of business, or A place where you meet or deal with patients, clients, or customers in the normal course of your trade or business, or A separate structure (not attached to your home) used in connection with your trade or business. Can i still e file 2011 taxes   You generally do not have to meet the exclusive use test for the part of your home that you regularly use either for the storage of inventory or product samples, or as a daycare facility. Can i still e file 2011 taxes   Your home office qualifies as your principal place of business if you meet the following requirements. Can i still e file 2011 taxes You use the office exclusively and regularly for administrative or management activities of your trade or business. Can i still e file 2011 taxes You have no other fixed location where you conduct substantial administrative or management activities of your trade or business. Can i still e file 2011 taxes   If you have more than one business location, determine your principal place of business based on the following factors. Can i still e file 2011 taxes The relative importance of the activities performed at each location. Can i still e file 2011 taxes If the relative importance factor does not determine your principal place of business, consider the time spent at each location. Can i still e file 2011 taxes Optional safe harbor method. Can i still e file 2011 taxes   Beginning in 2013, individual taxpayers can use the optional safe harbor method to determine the amount of deductible expenses attributable to certain business use of a residence during the tax year. Can i still e file 2011 taxes This method is an alternative to the calculation, allocation, and substantiation of actual expenses. Can i still e file 2011 taxes   The deduction under the optional method is limited to $1,500 per year based on $5 a square foot for up to 300 square feet. Can i still e file 2011 taxes Under this method, you claim your allowable mortgage interest, real estate taxes, and casualty losses on the home as itemized deductions on Schedule A (Form 1040). Can i still e file 2011 taxes You are not required to allocate these deductions between personal and business use, as is required under the regular method. Can i still e file 2011 taxes If you use the optional method, you cannot depreciate the portion of your home used in a trade or business. Can i still e file 2011 taxes   Business expenses unrelated to the home, such as advertising, supplies, and wages paid to employees, are still fully deductible. Can i still e file 2011 taxes All of the requirements discussed earlier under Business use of your home still apply. Can i still e file 2011 taxes   For more information on the deduction for business use of your home, including the optional safe harbor method, see Publication 587. Can i still e file 2011 taxes    If you were entitled to deduct depreciation on the part of your home used for business, you cannot exclude the part of the gain from the sale of your home that equals any depreciation you deducted (or could have deducted) for periods after May 6, 1997. Can i still e file 2011 taxes Business use of your car. Can i still e file 2011 taxes   If you use your car exclusively in your business, you can deduct car expenses. Can i still e file 2011 taxes If you use your car for both business and personal purposes, you must divide your expenses based on actual mileage. Can i still e file 2011 taxes Generally, commuting expenses between your home and your business location, within the area of your tax home, are not deductible. Can i still e file 2011 taxes   You can deduct actual car expenses, which include depreciation (or lease payments), gas and oil, tires, repairs, tune-ups, insurance, and registration fees. Can i still e file 2011 taxes Or, instead of figuring the business part of these actual expenses, you may be able to use the standard mileage rate to figure your deduction. Can i still e file 2011 taxes Beginning in 2013, the standard mileage rate is 56. Can i still e file 2011 taxes 5 cents per mile. Can i still e file 2011 taxes   If you are self-employed, you can also deduct the business part of interest on your car loan, state and local personal property tax on the car, parking fees, and tolls, whether or not you claim the standard mileage rate. Can i still e file 2011 taxes   For more information on car expenses and the rules for using the standard mileage rate, see Publication 463. Can i still e file 2011 taxes How Much Can I Deduct? Generally, you can deduct the full amount of a business expense if it meets the criteria of ordinary and necessary and it is not a capital expense. Can i still e file 2011 taxes Recovery of amount deducted (tax benefit rule). Can i still e file 2011 taxes   If you recover part of an expense in the same tax year in which you would have claimed a deduction, reduce your current year expense by the amount of the recovery. Can i still e file 2011 taxes If you have a recovery in a later year, include the recovered amount in income in that year. Can i still e file 2011 taxes However, if part of the deduction for the expense did not reduce your tax, you do not have to include that part of the recovered amount in income. Can i still e file 2011 taxes   For more information on recoveries and the tax benefit rule, see Publication 525. Can i still e file 2011 taxes Payments in kind. Can i still e file 2011 taxes   If you provide services to pay a business expense, the amount you can deduct is limited to your out-of-pocket costs. Can i still e file 2011 taxes You cannot deduct the cost of your own labor. Can i still e file 2011 taxes   Similarly, if you pay a business expense in goods or other property, you can deduct only what the property costs you. Can i still e file 2011 taxes If these costs are included in the cost of goods sold, do not deduct them again as a business expense. Can i still e file 2011 taxes Limits on losses. Can i still e file 2011 taxes   If your deductions for an investment or business activity are more than the income it brings in, you have a loss. Can i still e file 2011 taxes There may be limits on how much of the loss you can deduct. Can i still e file 2011 taxes Not-for-profit limits. Can i still e file 2011 taxes   If you carry on your business activity without the intention of making a profit, you cannot use a loss from it to offset other income. Can i still e file 2011 taxes See Not-for-Profit Activities , later. Can i still e file 2011 taxes At-risk limits. Can i still e file 2011 taxes   Generally, a deductible loss from a trade or business or other income-producing activity is limited to the investment you have “at risk” in the activity. Can i still e file 2011 taxes You are at risk in any activity for the following. Can i still e file 2011 taxes The money and adjusted basis of property you contribute to the activity. Can i still e file 2011 taxes Amounts you borrow for use in the activity if: You are personally liable for repayment, or You pledge property (other than property used in the activity) as security for the loan. Can i still e file 2011 taxes For more information, see Publication 925. Can i still e file 2011 taxes Passive activities. Can i still e file 2011 taxes   Generally, you are in a passive activity if you have a trade or business activity in which you do not materially participate, or a rental activity. Can i still e file 2011 taxes In general, deductions for losses from passive activities only offset income from passive activities. Can i still e file 2011 taxes You cannot use any excess deductions to offset other income. Can i still e file 2011 taxes In addition, passive activity credits can only offset the tax on net passive income. Can i still e file 2011 taxes Any excess loss or credits are carried over to later years. Can i still e file 2011 taxes Suspended passive losses are fully deductible in the year you completely dispose of the activity. Can i still e file 2011 taxes For more information, see Publication 925. Can i still e file 2011 taxes Net operating loss. Can i still e file 2011 taxes   If your deductions are more than your income for the year, you may have a “net operating loss. Can i still e file 2011 taxes ” You can use a net operating loss to lower your taxes in other years. Can i still e file 2011 taxes See Publication 536 for more information. Can i still e file 2011 taxes   See Publication 542 for information about net operating losses of corporations. Can i still e file 2011 taxes When Can I Deduct an Expense? When you can deduct an expense depends on your accounting method. Can i still e file 2011 taxes An accounting method is a set of rules used to determine when and how income and expenses are reported. Can i still e file 2011 taxes The two basic methods are the cash method and the accrual method. Can i still e file 2011 taxes Whichever method you choose must clearly reflect income. Can i still e file 2011 taxes For more information on accounting methods, see Publication 538. Can i still e file 2011 taxes Cash method. Can i still e file 2011 taxes   Under the cash method of accounting, you generally deduct business expenses in the tax year you pay them. Can i still e file 2011 taxes Accrual method. Can i still e file 2011 taxes   Under an accrual method of accounting, you generally deduct business expenses when both of the following apply. Can i still e file 2011 taxes The all-events test has been met. Can i still e file 2011 taxes The test is met when: All events have occurred that fix the fact of liability, and The liability can be determined with reasonable accuracy. Can i still e file 2011 taxes Economic performance has occurred. Can i still e file 2011 taxes Economic performance. Can i still e file 2011 taxes   You generally cannot deduct or capitalize a business expense until economic performance occurs. Can i still e file 2011 taxes If your expense is for property or services provided to you, or for your use of property, economic performance occurs as the property or services are provided, or the property is used. Can i still e file 2011 taxes If your expense is for property or services you provide to others, economic performance occurs as you provide the property or services. Can i still e file 2011 taxes Example. Can i still e file 2011 taxes Your tax year is the calendar year. Can i still e file 2011 taxes In December 2013, the Field Plumbing Company did some repair work at your place of business and sent you a bill for $600. Can i still e file 2011 taxes You paid it by check in January 2014. Can i still e file 2011 taxes If you use the accrual method of accounting, deduct the $600 on your tax return for 2013 because all events have occurred to “fix” the fact of liability (in this case the work was completed), the liability can be determined, and economic performance occurred in that year. Can i still e file 2011 taxes If you use the cash method of accounting, deduct the expense on your 2014 return. Can i still e file 2011 taxes Prepayment. Can i still e file 2011 taxes   You generally cannot deduct expenses in advance, even if you pay them in advance. Can i still e file 2011 taxes This rule applies to both the cash and accrual methods. Can i still e file 2011 taxes It applies to prepaid interest, prepaid insurance premiums, and any other expense paid far enough in advance to, in effect, create an asset with a useful life extending substantially beyond the end of the current tax year. Can i still e file 2011 taxes Example. Can i still e file 2011 taxes In 2013, you sign a 10-year lease and immediately pay your rent for the first 3 years. Can i still e file 2011 taxes Even though you paid the rent for 2013, 2014, and 2015, you can only deduct the rent for 2013 on your 2013 tax return. Can i still e file 2011 taxes You can deduct the rent for 2014 and 2015 on your tax returns for those years. Can i still e file 2011 taxes Contested liability. Can i still e file 2011 taxes   Under the cash method, you can deduct a contested liability only in the year you pay the liability. Can i still e file 2011 taxes Under the accrual method, you can deduct contested liabilities such as taxes (except foreign or U. Can i still e file 2011 taxes S. Can i still e file 2011 taxes possession income, war profits, and excess profits taxes) either in the tax year you pay the liability (or transfer money or other property to satisfy the obligation) or in the tax year you settle the contest. Can i still e file 2011 taxes However, to take the deduction in the year of payment or transfer, you must meet certain conditions. Can i still e file 2011 taxes See Regulations section 1. Can i still e file 2011 taxes 461-2. Can i still e file 2011 taxes Related person. Can i still e file 2011 taxes   Under an accrual method of accounting, you generally deduct expenses when you incur them, even if you have not yet paid them. Can i still e file 2011 taxes However, if you and the person you owe are related and that person uses the cash method of accounting, you must pay the expense before you can deduct it. Can i still e file 2011 taxes Your deduction is allowed when the amount is includible in income by the related cash method payee. Can i still e file 2011 taxes See Related Persons in Publication 538. Can i still e file 2011 taxes Not-for-Profit Activities If you do not carry on your business or investment activity to make a profit, you cannot use a loss from the activity to offset other income. Can i still e file 2011 taxes Activities you do as a hobby, or mainly for sport or recreation, are often not entered into for profit. Can i still e file 2011 taxes The limit on not-for-profit losses applies to individuals, partnerships, estates, trusts, and S corporations. Can i still e file 2011 taxes It does not apply to corporations other than S corporations. Can i still e file 2011 taxes In determining whether you are carrying on an activity for profit, several factors are taken into account. Can i still e file 2011 taxes No one factor alone is decisive. Can i still e file 2011 taxes Among the factors to consider are whether: You carry on the activity in a businesslike manner, The time and effort you put into the activity indicate you intend to make it profitable, You depend on the income for your livelihood, Your losses are due to circumstances beyond your control (or are normal in the start-up phase of your type of business), You change your methods of operation in an attempt to improve profitability, You (or your advisors) have the knowledge needed to carry on the activity as a successful business, You were successful in making a profit in similar activities in the past, The activity makes a profit in some years, and You can expect to make a future profit from the appreciation of the assets used in the activity. Can i still e file 2011 taxes Presumption of profit. Can i still e file 2011 taxes   An activity is presumed carried on for profit if it produced a profit in at least 3 of the last 5 tax years, including the current year. Can i still e file 2011 taxes Activities that consist primarily of breeding, training, showing, or racing horses are presumed carried on for profit if they produced a profit in at least 2 of the last 7 tax years, including the current year. Can i still e file 2011 taxes The activity must be substantially the same for each year within this period. Can i still e file 2011 taxes You have a profit when the gross income from an activity exceeds the deductions. Can i still e file 2011 taxes   If a taxpayer dies before the end of the 5-year (or 7-year) period, the “test” period ends on the date of the taxpayer's death. Can i still e file 2011 taxes   If your business or investment activity passes this 3- (or 2-) years-of-profit test, the IRS will presume it is carried on for profit. Can i still e file 2011 taxes This means the limits discussed here will not apply. Can i still e file 2011 taxes You can take all your business deductions from the activity, even for the years that you have a loss. Can i still e file 2011 taxes You can rely on this presumption unless the IRS later shows it to be invalid. Can i still e file 2011 taxes Using the presumption later. Can i still e file 2011 taxes   If you are starting an activity and do not have 3 (or 2) years showing a profit, you can elect to have the presumption made after you have the 5 (or 7) years of experience allowed by the test. Can i still e file 2011 taxes   You can elect to do this by filing Form 5213. Can i still e file 2011 taxes Filing this form postpones any determination that your activity is not carried on for profit until 5 (or 7) years have passed since you started the activity. Can i still e file 2011 taxes   The benefit gained by making this election is that the IRS will not immediately question whether your activity is engaged in for profit. Can i still e file 2011 taxes Accordingly, it will not restrict your deductions. Can i still e file 2011 taxes Rather, you will gain time to earn a profit in the required number of years. Can i still e file 2011 taxes If you show 3 (or 2) years of profit at the end of this period, your deductions are not limited under these rules. Can i still e file 2011 taxes If you do not have 3 (or 2) years of profit, the limit can be applied retroactively to any year with a loss in the 5-year (or 7-year) period. Can i still e file 2011 taxes   Filing Form 5213 automatically extends the period of limitations on any year in the 5-year (or 7-year) period to 2 years after the due date of the return for the last year of the period. Can i still e file 2011 taxes The period is extended only for deductions of the activity and any related deductions that might be affected. Can i still e file 2011 taxes    You must file Form 5213 within 3 years after the due date of your return (determined without extensions) for the year in which you first carried on the activity, or, if earlier, within 60 days after receiving written notice from the Internal Revenue Service proposing to disallow deductions attributable to the activity. Can i still e file 2011 taxes Gross Income Gross income from a not-for-profit activity includes the total of all gains from the sale, exchange, or other disposition of property, and all other gross receipts derived from the activity. Can i still e file 2011 taxes Gross income from the activity also includes capital gains and rents received for the use of property which is held in connection with the activity. Can i still e file 2011 taxes You can determine gross income from any not-for-profit activity by subtracting the cost of goods sold from your gross receipts. Can i still e file 2011 taxes However, if you determine gross income by subtracting cost of goods sold from gross receipts, you must do so consistently, and in a manner that follows generally accepted methods of accounting. Can i still e file 2011 taxes Limit on Deductions If your activity is not carried on for profit, take deductions in the following order and only to the extent stated in the three categories. Can i still e file 2011 taxes If you are an individual, these deductions may be taken only if you itemize. Can i still e file 2011 taxes These deductions may be taken on Schedule A (Form 1040). Can i still e file 2011 taxes Category 1. Can i still e file 2011 taxes   Deductions you can take for personal as well as for business activities are allowed in full. Can i still e file 2011 taxes For individuals, all nonbusiness deductions, such as those for home mortgage interest, taxes, and casualty losses, belong in this category. Can i still e file 2011 taxes Deduct them on the appropriate lines of Schedule A (Form 1040). Can i still e file 2011 taxes For tax years beginning after December 31, 2008, you can deduct a casualty loss on property you own for personal use only to the extent it is more than $500 and exceeds 10% of your adjusted gross income (AGI). Can i still e file 2011 taxes The 10% AGI limitation does not apply to net disaster losses resulting from federally declared disasters in 2008 and 2009, and individuals are allowed to claim the net disaster losses even if they do not itemize their deductions. Can i still e file 2011 taxes The reduction amount returns to $100 for tax years beginning after December 31, 2009. Can i still e file 2011 taxes See Publication 547 for more information on casualty losses. Can i still e file 2011 taxes For the limits that apply to home mortgage interest, see Publication 936. Can i still e file 2011 taxes Category 2. Can i still e file 2011 taxes   Deductions that do not result in an adjustment to the basis of property are allowed next, but only to the extent your gross income from the activity is more than your deductions under the first category. Can i still e file 2011 taxes Most business deductions, such as those for advertising, insurance premiums, interest, utilities, and wages, belong in this category. Can i still e file 2011 taxes Category 3. Can i still e file 2011 taxes   Business deductions that decrease the basis of property are allowed last, but only to the extent the gross income from the activity exceeds the deductions you take under the first two categories. Can i still e file 2011 taxes Deductions for depreciation, amortization, and the part of a casualty loss an individual could not deduct in category (1) belong in this category. Can i still e file 2011 taxes Where more than one asset is involved, allocate depreciation and these other deductions proportionally. Can i still e file 2011 taxes    Individuals must claim the amounts in categories (2) and (3) as miscellaneous deductions on Schedule A (Form 1040). Can i still e file 2011 taxes They are subject to the 2%-of-adjusted-gross-income limit. Can i still e file 2011 taxes See Publication 529 for information on this limit. Can i still e file 2011 taxes Example. Can i still e file 2011 taxes Adriana is engaged in a not-for-profit activity. Can i still e file 2011 taxes The income and expenses of the activity are as follows. Can i still e file 2011 taxes Gross income $3,200 Subtract:     Real estate taxes $700   Home mortgage interest 900   Insurance 400   Utilities 700   Maintenance 200   Depreciation on an automobile 600   Depreciation on a machine 200 3,700 Loss $(500)   Adriana must limit her deductions to $3,200, the gross income she earned from the activity. Can i still e file 2011 taxes The limit is reached in category (3), as follows. Can i still e file 2011 taxes Limit on deduction $3,200 Category 1: Taxes and interest $1,600   Category 2: Insurance, utilities, and maintenance 1,300 2,900 Available for Category 3 $ 300   The $800 of depreciation is allocated between the automobile and machine as follows. Can i still e file 2011 taxes $600 $800 x $300 = $225 depreciation for the automobile             $200 $800 x $300 = $75 depreciation for the machine The basis of each asset is reduced accordingly. Can i still e file 2011 taxes Adriana includes the $3,200 of gross income on line 21 (other income) of Form 1040. Can i still e file 2011 taxes The $1,600 for category (1) is deductible in full on the appropriate lines for taxes and interest on Schedule A (Form 1040). Can i still e file 2011 taxes Adriana deducts the remaining $1,600 ($1,300 for category (2) and $300 for category (3)) as other miscellaneous deductions on Schedule A (Form 1040) subject to the 2%-of-adjusted-gross-income limit. Can i still e file 2011 taxes Partnerships and S corporations. Can i still e file 2011 taxes   If a partnership or S corporation carries on a not-for-profit activity, these limits apply at the partnership or S corporation level. Can i still e file 2011 taxes They are reflected in the individual shareholder's or partner's distributive shares. Can i still e file 2011 taxes More than one activity. Can i still e file 2011 taxes   If you have several undertakings, each may be a separate activity or several undertakings may be combined. Can i still e file 2011 taxes The following are the most significant facts and circumstances in making this determination. Can i still e file 2011 taxes The degree of organizational and economic interrelationship of various undertakings. Can i still e file 2011 taxes The business purpose that is (or might be) served by carrying on the various undertakings separately or together in a business or investment setting. Can i still e file 2011 taxes The similarity of the undertakings. Can i still e file 2011 taxes   The IRS will generally accept your characterization if it is supported by facts and circumstances. Can i still e file 2011 taxes    If you are carrying on two or more different activities, keep the deductions and income from each one separate. Can i still e file 2011 taxes Figure separately whether each is a not-for-profit activity. Can i still e file 2011 taxes Then figure the limit on deductions and losses separately for each activity that is not for profit. Can i still e file 2011 taxes Prev  Up  Next   Home   More Online Publications