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Efile Tax Return For Free

Efile tax return for free Publication 547(SP) - Introductory Material Table of Contents Qué Hay de Nuevo Recordatorios IntroductionCómo pedir formularios y publicaciones. Efile tax return for free Preguntas sobre los impuestos. Efile tax return for free Useful Items - You may want to see: Qué Hay de Nuevo Nueva Sección C en el Formulario 4684 para esquemas de inversión de tipo Ponzi (Ponzi-type schemes). Efile tax return for free  La Sección C del Formulario 4684 (disponible en inglés) es nueva para el año 2013. Efile tax return for free Usted debe completar la Seción C si está reclamando una deducción de pérdida por robo debido a un esquema de inversión de tipo Ponzi (Ponzi-type scheme) y estará usando el Procedimiento Tributario (Revenue Procedure) 2009-20, según modificado por el Procedimiento Tributario (Revenue Procedure) 2011-58. Efile tax return for free La Sección C del Formulario 4864 reemplaza el Anexo A del Procedimiento Tributario (Revenue Procedure) 2009-20. Efile tax return for free No necesita completar el Anexo A. Efile tax return for free Para más información, vea Pérdidas provenientes de esquemas de inversión de tipo Ponzi (Ponzi-type schemes) , más adelante. Efile tax return for free Recordatorios Acontecimientos futuros. Efile tax return for free  Si desea obtener la información más reciente sobre los acontecimientos relacionados con la Publicación 547(SP), tal como legislación promulgada después que ésta fue impresa, acceda a www. Efile tax return for free irs. Efile tax return for free gov/Spanish/About-Publication-547(SP). Efile tax return for free Fotografías de niños desaparecidos. Efile tax return for free  El Servicio de Impuestos Internos (IRS, por sus siglas en inglés) se enorgullece en colaborar con el Centro Nacional de Niños Desaparecidos y Explotados (National Center for Missing and Exploited Children). Efile tax return for free En esta publicación, pueden aparecer fotografías de niños desaparecidos que han sido seleccionadas por el Centro. Efile tax return for free Estas fotografías aparecen en páginas que de otra manera estarían en blanco. Efile tax return for free Usted puede ayudar a que estos niños regresen a sus hogares si identifica alguno de ellos y llama gratis al 1-800-THE-LOST (1-800-843-5678). Efile tax return for free Introduction Esta publicación explica el trato tributario de casos de hechos fortuitos, robos y pérdidas de depósitos monetarios. Efile tax return for free Un hecho fortuito ocurre cuando su propiedad resulta dañada por causa de algún desastre, como por ejemplo, una tormenta, un incendio, un accidente automovilístico u otro suceso de esta índole. Efile tax return for free Un robo ocurre cuando alguien hurta sus bienes. Efile tax return for free La pérdida de depósitos monetarios ocurre cuando su institución bancaria se declara insolvente o en quiebra (bancarrota). Efile tax return for free Esta publicación aborda los siguientes temas: Definiciones de hecho fortuito, robo y pérdida de depósitos monetarios. Efile tax return for free Cómo calcular el monto de su pérdida o ganancia. Efile tax return for free Cómo se tratan tributariamente seguros y otros reembolsos que reciba. Efile tax return for free Límites de la deducción. Efile tax return for free Cómo y cuándo declarar un caso de hecho fortuito o robo. Efile tax return for free Reglas especiales para pérdidas en zonas de desastre. Efile tax return for free Formularios que tiene que presentar. Efile tax return for free   Normalmente, si es víctima de un hecho fortuito o robo, tiene que presentar el Formulario 4684 (disponible sólo en inglés). Efile tax return for free Asimismo, es posible que tenga que presentar uno o más de los siguientes formularios (todos en inglés): Anexo A (Formulario 1040). Efile tax return for free Formulario 1040NR, Anexo A (para extranjeros no residentes). Efile tax return for free Anexo D. Efile tax return for free Formulario 4797. Efile tax return for free Para información adicional sobre qué formulario utilizar, vea más adelante la sección sobre Cómo Declarar Pérdidas y Ganancias . Efile tax return for free Expropiaciones forzosas. Efile tax return for free   Para obtener información sobre expropiaciones forzosas de propiedades, vea el tema Involuntary Conversions (Conversiones involuntarias) en el capítulo 1 de la Publicación 544, Sales and Other Dispositions of Assets (Ventas y otras enajenaciones de activos), en inglés. Efile tax return for free Registros para el cálculo de pérdidas por hecho fortuito y robo. Efile tax return for free   La Publicación 584SP, Registro de Pérdidas por Hechos Fortuitos (Imprevistos), Desastres y Robos (Propiedad de uso Personal) está a su disposición para ayudarle a hacer una lista de artículos de sus bienes de uso personal que hayan sido robados o dañados y calcular su pérdida. Efile tax return for free En dicha publicación se incluyen tablas para ayudarle a calcular el monto de las pérdidas de su vivienda, artículos de la misma y vehículos motorizados. Efile tax return for free   La Publicación 584-B, Business Casualty, Disaster, and Theft Loss Workbook (Registro de pérdidas por hechos fortuitos, desastres y robos de propiedad de uso comercial), en inglés puede ayudarle a hacer una lista de artículos que hayan sido robados o dañados en su empresa o bienes de generación de ingresos, y calcular su pérdida. Efile tax return for free Comentarios y sugerencias. Efile tax return for free   Agradecemos sus comentarios y sugerencias sobre esta publicación para ediciones futuras. Efile tax return for free   Puede escribirnos a la siguiente dirección: Internal Revenue Service Tax Forms and Publications Division 1111 Constitution Ave. Efile tax return for free NW, IR-6526 Washington, DC 20224   Contestamos gran parte de correspondencia por teléfono. Efile tax return for free Por lo tanto, nos sería útil si en su correspondencia incluye el número telefónico con su código de área donde podemos ubicarlo durante el día. Efile tax return for free   Puede enviarnos comentarios a través de www. Efile tax return for free irs. Efile tax return for free gov/formspubs, pulsando sobre “ Comment on Tax Forms and Publications ” (Comentarios sobre formularios y publicaciones tributarios) bajo el título “ Information about ” (Información sobre), en inglés. Efile tax return for free   Aunque no podemos contestar cada uno de los comentarios, agradecemos su opinión y tendremos en cuenta sus comentarios cuando revisemos nuestros productos. Efile tax return for free Cómo pedir formularios y publicaciones. Efile tax return for free   Visite el sitio web del IRS www. Efile tax return for free irs. Efile tax return for free gov/espanol y pulse sobre el enlace “Formularios y Publicaciones” para descargar formularios y publicaciones. Efile tax return for free Llame al 1-800-829-3676 o escriba a la dirección que aparece a continuación y recibirá respuesta a los 10 días de que el IRS reciba su solicitud: Internal Revenue Service 1201 N. Efile tax return for free Mitsubishi Motorway Bloomington, IL 61705-6613 Preguntas sobre los impuestos. Efile tax return for free   Si tiene alguna pregunta acerca de sus impuestos, consulte la información disponible en IRS. Efile tax return for free gov/espanol o llame al número 1-800-829-1040. Efile tax return for free No podemos contestar preguntas sobre impuestos enviadas a las direcciones anteriores. Efile tax return for free Useful Items - You may want to see: Publicación 523 Selling Your Home (Venta de su vivienda), en inglés 525 Taxable and Nontaxable Income (Ingresos tributables y no tributables), en inglés 550 Investment Income and Expenses (Ingresos y gastos de inversiones), en inglés 551 Basis of Assets (Base de activos), en inglés 584SP Registro de Pérdidas por Hechos Fortuitos (Imprevistos), Desastres y Robos (Propiedad de Uso Personal) 584-B Business Casualty, Disaster, and Theft Loss Workbook (Registro de pérdidas por hechos fortuitos, desastres y robos comerciales), en inglés  Formulario (e Instrucciones) Anexo A (Formulario 1040) Itemized Deductions (Deducciones detalladas), en inglés Anexo A (Formulario 1040NR) Itemized Deductions (for nonresident aliens) (Deducciones detalladas (para extranjeros no residentes)), en inglés Anexo D (Formulario 1040) Capital Gains and Losses (Pérdidas y ganancias de capital), en inglés 4684 Casualties and Thefts (Hechos fortuitos y robos), en inglés 4797 Sales of Business Property (Ventas de bienes comerciales), en inglés  Para más información sobre cómo obtener publicaciones y formularios, vea la sección Cómo Obtener Ayuda con los Impuestos al final de esta publicación. 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The Efile Tax Return For Free

Efile tax return for free 2. Efile tax return for free   Tax Shelters and Other Reportable Transactions Table of Contents Introduction Topics - This chapter discusses: Useful Items - You may want to see: Abusive Tax SheltersRules To Curb Abusive Tax Shelters Investor Reporting Penalties Whether To Invest Introduction Investments that yield tax benefits are sometimes called “tax shelters. Efile tax return for free ” In some cases, Congress has concluded that the loss of revenue is an acceptable side effect of special tax provisions designed to encourage taxpayers to make certain types of investments. Efile tax return for free In many cases, however, losses from tax shelters produce little or no benefit to society, or the tax benefits are exaggerated beyond those intended. Efile tax return for free Those cases are called “abusive tax shelters. Efile tax return for free ” An investment that is considered a tax shelter is subject to restrictions, including the requirement that it be disclosed, as discussed later. Efile tax return for free Topics - This chapter discusses: Abusive Tax Shelters , Rules To Curb Abusive Tax Shelters , Investor Reporting , Penalties , and Whether To Invest . Efile tax return for free Useful Items - You may want to see: Publication 538 Accounting Periods and Methods 556 Examination of Returns, Appeal Rights, and Claims for Refund 561 Determining the Value of Donated Property 925 Passive Activity and At-Risk Rules Form (and Instructions) 8275 Disclosure Statement 8275-R Regulation Disclosure Statement 8283 Noncash Charitable Contributions 8886 Reportable Transaction Disclosure Statement See chapter 5, How To Get Tax Help , for information about getting these publications and forms. Efile tax return for free Abusive Tax Shelters Abusive tax shelters are marketing schemes involving artificial transactions with little or no economic reality. Efile tax return for free They often make use of unrealistic allocations, inflated appraisals, losses in connection with nonrecourse loans, mismatching of income and deductions, financing techniques that do not conform to standard commercial business practices, or mischaracterization of the substance of the transaction. Efile tax return for free Despite appearances to the contrary, the taxpayer generally risks little. Efile tax return for free Abusive tax shelters commonly involve package deals designed from the start to generate losses, deductions, or credits that will be far more than present or future investment. Efile tax return for free Or, they may promise investors from the start that future inflated appraisals will enable them, for example, to reap charitable contribution deductions based on those appraisals. Efile tax return for free (But see the appraisal requirements discussed under Rules To Curb Abusive Tax Shelters , later. Efile tax return for free ) They are commonly marketed in terms of the ratio of tax deductions allegedly available to each dollar invested. Efile tax return for free This ratio (or “write-off”) is frequently said to be several times greater than one-to-one. Efile tax return for free Because there are many abusive tax shelters, it is not possible to list all the factors you should consider in determining whether an offering is an abusive tax shelter. Efile tax return for free However, you should ask the following questions, which might provide a clue to the abusive nature of the plan. Efile tax return for free Do the tax benefits far outweigh the economic benefits? Is this a transaction you would seriously consider, apart from the tax benefits, if you hoped to make a profit? Do shelter assets really exist and, if so, are they insured for less than their purchase price? Is there a nontax justification for the way profits and losses are allocated to partners? Do the facts and supporting documents make economic sense? In that connection, are there sales and resales of the tax shelter property at ever increasing prices? Does the investment plan involve a gimmick, device, or sham to hide the economic reality of the transaction? Does the promoter offer to backdate documents after the close of the year? Are you instructed to backdate checks covering your investment? Is your debt a real debt or are you assured by the promoter that you will never have to pay it? Does this transaction involve laundering United States source income through foreign corporations incorporated in a tax haven and owned by United States shareholders? Rules To Curb Abusive Tax Shelters Congress has enacted a series of income tax laws designed to halt the growth of abusive tax shelters. Efile tax return for free These provisions include the following. Efile tax return for free Disclosure of reportable transactions. Efile tax return for free   You must disclose information for each reportable transaction in which you participate. Efile tax return for free See Reportable Transaction Disclosure Statement , later. Efile tax return for free   Material advisors with respect to any reportable transaction must disclose information about the transaction on Form 8918, Material Advisor Disclosure Statement. Efile tax return for free To determine whether you are a material advisor to a transaction, see the Instructions for Form 8918. Efile tax return for free   Material advisors will receive a reportable transaction number for the disclosed reportable transaction. Efile tax return for free They must provide this number to all persons to whom they acted as a material advisor. Efile tax return for free They must provide the number at the time the transaction is entered into. Efile tax return for free If they do not have the number at that time, they must provide it within 60 days from the date the number is mailed to them. Efile tax return for free For information on penalties for failure to disclose and failure to maintain lists, see Internal Revenue Code sections 6707, 6707A, and 6708. Efile tax return for free Requirement to maintain list. Efile tax return for free   Material advisors must maintain a list of persons to whom they provide material aid, assistance, or advice on any reportable transaction. Efile tax return for free The list must be available for inspection by the IRS, and the information required to be included on the list generally must be kept for 7 years. Efile tax return for free See Regulations section 301. Efile tax return for free 6112-1 for more information (including what information is required to be included on the list). Efile tax return for free Confidentiality privilege. Efile tax return for free   The confidentiality privilege between you and a federally authorized tax practitioner does not apply to written communications made after October 21, 2004, regarding the promotion of your direct or indirect participation in any tax shelter. Efile tax return for free Appraisal requirement for donated property. Efile tax return for free   If you claim a deduction of more than $5,000 for an item or group of similar items of donated property, you generally must get a qualified appraisal from a qualified appraiser and complete and attach section B of Form 8283 to your return. Efile tax return for free If you claim a deduction of more than $500,000 for the donated property, you generally must attach the qualified appraisal to your return. Efile tax return for free If you file electronically, see Form 8453, U. Efile tax return for free S. Efile tax return for free Individual Income Tax Transmittal for an IRS e-file Return, and its instructions. Efile tax return for free For more information about appraisals, including exceptions, see Publication 561. Efile tax return for free Passive activity loss and credit limits. Efile tax return for free   The passive activity loss and credit rules limit the amount of losses and credits that can be claimed from passive activities and limit the amount that can offset nonpassive income, such as certain portfolio income from investments. Efile tax return for free For more detailed information about determining and reporting income, losses, and credits from passive activities, see Publication 925. Efile tax return for free Interest on penalties. Efile tax return for free   If you are assessed an accuracy-related or civil fraud penalty (as discussed under Penalties , later), interest will be imposed on the amount of the penalty from the due date of the return (including any extensions) to the date you pay the penalty. Efile tax return for free Accounting method restriction. Efile tax return for free   Tax shelters generally cannot use the cash method of accounting. Efile tax return for free Uniform capitalization rules. Efile tax return for free   The uniform capitalization rules generally apply to producing property or acquiring it for resale. Efile tax return for free Under those rules, the direct cost and part of the indirect cost of the property must be capitalized or included in inventory. Efile tax return for free For more information, see Publication 538. Efile tax return for free Denial of deduction for interest on an underpayment due to a reportable transaction. Efile tax return for free   You cannot deduct any interest you paid or accrued on any part of an underpayment of tax due to an understatement arising from a reportable transaction (discussed later) if the relevant facts affecting the tax treatment of the item are not adequately disclosed. Efile tax return for free This rule applies to reportable transactions entered into in tax years beginning after October 22, 2004. Efile tax return for free Authority for Disallowance of Tax Benefits The IRS has published guidance concluding that the claimed tax benefits of various abusive tax shelters should be disallowed. Efile tax return for free The guidance is the conclusion of the IRS on how the law is applied to a particular set of facts. Efile tax return for free Guidance is published in the Internal Revenue Bulletin for taxpayers' information and also for use by IRS officials. Efile tax return for free So, if your return is examined and an abusive tax shelter is identified and challenged, published guidance dealing with that type of shelter, which disallows certain claimed tax shelter benefits, could serve as the basis for the examining official's challenge of the tax benefits you claimed. Efile tax return for free In such a case, the examiner will not compromise even if you or your representative believes you have authority for the positions taken on your tax return. Efile tax return for free The courts have generally been unsympathetic to taxpayers involved in abusive tax shelter schemes and have ruled in favor of the IRS in the majority of the cases in which these shelters have been challenged. Efile tax return for free Investor Reporting You may be required to file a reportable transaction disclosure statement. Efile tax return for free Reportable Transaction Disclosure Statement Use Form 8886 to disclose information for each reportable transaction (discussed later) in which you participated. Efile tax return for free Generally, you must attach Form 8886 to your return for each tax year in which you participated in the transaction. Efile tax return for free Under certain circumstances, a transaction must be disclosed within 90 days of the transaction being identified as a listed transaction or a transaction of interest (discussed later). Efile tax return for free In addition, for the first year Form 8886 is attached to your return, you must send a copy of the form to: Internal Revenue Service OTSA Mail Stop 4915 1973 North Rulon White Blvd. Efile tax return for free  Ogden, UT 84404 If you file your return electronically, the copy sent to OTSA must show exactly the same information, word for word, provided with the electronically filed return and it must be provided on the official IRS Form 8886 or an exact copy of the form. Efile tax return for free If you use a computer-generated or substitute Form 8886, it must be an exact copy of the official IRS form. Efile tax return for free If you fail to file Form 8886 as required or fail to include any required information on the form, you may have to pay a penalty. Efile tax return for free See Penalty for failure to disclose a reportable transaction , later under Penalties. Efile tax return for free The following discussion briefly describes reportable transactions. Efile tax return for free For more details, see the Instructions for Form 8886. Efile tax return for free Reportable transaction. Efile tax return for free   A reportable transaction is any of the following. Efile tax return for free A listed transaction. Efile tax return for free A confidential transaction. Efile tax return for free A transaction with contractual protection. Efile tax return for free A loss transaction. Efile tax return for free A transaction of interest entered into after November 1, 2006. Efile tax return for free Note. Efile tax return for free Transactions with a brief asset holding period were removed from the definition of reportable transaction for transactions entered into after August 2, 2007. Efile tax return for free Listed transaction. Efile tax return for free   A listed transaction is the same as, or substantially similar to, one of the types of transactions the IRS has determined to be a tax-avoidance transaction. Efile tax return for free These transactions have been identified in notices, regulations, and other published guidance issued by the IRS. Efile tax return for free For a list of existing guidance, see Notice 2009-59 in Internal Revenue Bulletin 2009-31, available at www. Efile tax return for free irs. Efile tax return for free gov/irb/2009-31_IRB/ar07. Efile tax return for free html. Efile tax return for free Confidential transaction. Efile tax return for free   A confidential transaction is offered to you under conditions of confidentiality and for which you have paid an advisor a minimum fee. Efile tax return for free A transaction is offered under conditions of confidentiality if the advisor who is paid the fee places a limit on your disclosure of the tax treatment or tax structure of the transaction and the limit protects the confidentiality of the advisor's tax strategies. Efile tax return for free The transaction is treated as confidential even if the conditions of confidentiality are not legally binding on you. Efile tax return for free Transaction with contractual protection. Efile tax return for free   Generally, a transaction with contractual protection is one in which you or a related party has the right to a full or partial refund of fees if all or part of the intended tax consequences of the transaction are not sustained, or a transaction for which the fees are contingent on your realizing the tax benefits from the transaction. Efile tax return for free For information on exceptions, see Revenue Procedure 2007-20 in Internal Revenue Bulletin 2007-7, available at www. Efile tax return for free irs. Efile tax return for free gov/irb/2007-07_IRB/ar15. Efile tax return for free html. Efile tax return for free Loss transaction. Efile tax return for free   For individuals, a loss transaction is one that results in a deductible loss if the gross amount of the loss is at least $2 million in a single tax year or $4 million in any combination of tax years. Efile tax return for free A loss from a foreign currency transaction under Internal Revenue Code section 988 is a loss transaction if the gross amount of the loss is at least $50,000 in a single tax year, whether or not the loss flows through from an S corporation or partnership. Efile tax return for free   Certain losses (such as losses from casualties, thefts, and condemnations) are excepted from this category and do not have to be reported on Form 8886. Efile tax return for free For information on other exceptions, see Revenue Procedure 2004-66 in Internal Revenue Bulletin 2004-50, as modified and superseded by Revenue Procedure 2013-11, (or future published guidance) available at www. Efile tax return for free irs. Efile tax return for free gov/irb/2004-50_IRB/ar11. Efile tax return for free html. Efile tax return for free Transaction of interest. Efile tax return for free   A transaction of interest is a transaction entered into after November 1, 2006, that is the same as, or substantially similar to, one of the types of transactions that the IRS has identified by notice, regulation, or other form of published guidance as a transaction of interest. Efile tax return for free The IRS has identified the following transactions of interest. Efile tax return for free “Toggling” grantor trusts as described in Notice 2007-73, 2007-36 I. Efile tax return for free R. Efile tax return for free B. Efile tax return for free 545, available at www. Efile tax return for free irs. Efile tax return for free gov/irb/2007-36_IRB/ar20. Efile tax return for free html. Efile tax return for free Certain transactions involving contributions of a successor member interest in a limited liability company as described in Notice 2007-72, 2007-36 I. Efile tax return for free R. Efile tax return for free B. Efile tax return for free 544, available at www. Efile tax return for free irs. Efile tax return for free gov/irb/2007-36_IRB/ar19. Efile tax return for free html. Efile tax return for free Certain transactions involving the sale or other disposition of all interests in a charitable remainder trust and claiming little or no taxable gain as described in Notice 2008-99, 2008-47 I. Efile tax return for free R. Efile tax return for free B. Efile tax return for free 1194, available at www. Efile tax return for free irs. Efile tax return for free gov/irb/2008-47_IRB/ar11. Efile tax return for free html. Efile tax return for free Certain transactions involving a U. Efile tax return for free S. Efile tax return for free taxpayer owning controlled foreign corporations (CFCs) that hold stock of a lower-tier CFC through a domestic partnership to avoid reporting income as described in Notice 2009-7, 2009-3 I. Efile tax return for free R. Efile tax return for free B. Efile tax return for free 312, available at www. Efile tax return for free irs. Efile tax return for free gov/irb/2009-03_IRB/ar10. Efile tax return for free html. Efile tax return for free   For updates to this list, go to www. Efile tax return for free irs. Efile tax return for free gov/Businesses/Corporations/Abusive-Tax-Shelters-and-Transactions. Efile tax return for free Penalties Investing in an abusive tax shelter may lead to substantial expenses. Efile tax return for free First, the promoter generally charges a substantial fee. Efile tax return for free If your return is examined by the IRS and a tax deficiency is determined, you will be faced with payment of more tax, interest on the underpayment, possibly a 20%, 30%, or even 40% accuracy-related penalty, or a 75% civil fraud penalty. Efile tax return for free You may also be subject to the penalty for failure to pay tax. Efile tax return for free These penalties are explained in the following paragraphs. Efile tax return for free Accuracy-related penalties. Efile tax return for free   An accuracy-related penalty of 20% can be imposed for underpayments of tax due to: Negligence or disregard of rules or regulations, Substantial understatement of tax, Substantial valuation misstatement (increased to 40% for gross valuation misstatement), Transaction lacking economic substance (increased to 40% for undisclosed transaction lacking economic substance), or Undisclosed foreign financial asset understatement (40% in all cases). Efile tax return for free Except for a transaction lacking economic substance, this penalty will not be imposed if you can show you had reasonable cause for any understatement of tax and that you acted in good faith. Efile tax return for free Your failure to disclose a reportable transaction is a strong indication that you failed to act in good faith. Efile tax return for free   If you are charged an accuracy-related penalty, interest will be imposed on the amount of the penalty from the due date of the return (including extensions) to the date you pay the penalty. Efile tax return for free   The 20% penalties do not apply to any underpayment attributable to a reportable transaction understatement subject to an accuracy-related penalty (discussed later). Efile tax return for free Negligence or disregard of rules or regulations. Efile tax return for free   The penalty for negligence or disregard of rules or regulations is imposed only on the part of the underpayment due to negligence or disregard of rules or regulations. Efile tax return for free The penalty will not be charged if you can show you had reasonable cause for understating your tax and that you acted in good faith. Efile tax return for free    Negligence includes any failure to make a reasonable attempt to comply with the provisions of the Internal Revenue Code. Efile tax return for free It also includes any failure to keep adequate books and records. Efile tax return for free A return position that has a reasonable basis is not negligence. Efile tax return for free   Disregard includes any careless, reckless, or intentional disregard of rules or regulations. Efile tax return for free   The penalty for disregard of rules and regulations can be avoided if all the following are true. Efile tax return for free You keep adequate books and records. Efile tax return for free You have a reasonable basis for your position on the tax issue. Efile tax return for free You make an adequate disclosure of your position. Efile tax return for free Use Form 8275 to make your disclosure and attach it to your return. Efile tax return for free To disclose a position contrary to a regulation, use Form 8275-R. Efile tax return for free Use Form 8886 to disclose a reportable transaction (discussed earlier). Efile tax return for free Substantial understatement of tax. Efile tax return for free   An understatement is considered to be substantial if it is more than the greater of: 10% of the tax required to be shown on the return, or $5,000. Efile tax return for free An “understatement” is the amount of tax required to be shown on your return for a tax year minus the amount of tax shown on the return, reduced by any rebates. Efile tax return for free The term “rebate” generally means a decrease in the tax shown on your original return as the result of your filing an amended return or claim for refund. Efile tax return for free   For items other than tax shelters, you can file Form 8275 or Form 8275-R to disclose items that could cause a substantial understatement of income tax. Efile tax return for free In that way, you can avoid the substantial understatement penalty if you have a reasonable basis for your position on the tax issue. Efile tax return for free Disclosure of the tax shelter item on a tax return does not reduce the amount of the understatement. Efile tax return for free   Also, the understatement penalty will not be imposed if you can show there was reasonable cause for the underpayment caused by the understatement and that you acted in good faith. Efile tax return for free An important factor in establishing reasonable cause and good faith will be the extent of your effort to determine your proper tax liability under the law. Efile tax return for free Substantial valuation misstatement. Efile tax return for free   In general, you are liable for a 20% penalty for a substantial valuation misstatement if all the following are true. Efile tax return for free The value or adjusted basis of any property claimed on the return is 150% or more of the correct amount. Efile tax return for free You underpaid your tax by more than $5,000 because of the misstatement. Efile tax return for free You cannot establish that you had reasonable cause for the underpayment and that you acted in good faith. Efile tax return for free   You may be assessed a penalty of 40% for a gross valuation misstatement. Efile tax return for free If you misstate the value or the adjusted basis of property by 200% or more of the amount determined to be correct, you will be assessed a penalty of 40%, instead of 20%, of the amount you underpaid because of the gross valuation misstatement. Efile tax return for free The penalty rate is also 40% if the property's correct value or adjusted basis is zero. Efile tax return for free Transaction lacking economic substance. Efile tax return for free   The economic substance doctrine only applies to an individual that entered into a transaction in connection with a trade or business or an activity engaged in for the production of income. Efile tax return for free For transactions entered into after March 30, 2010, a transaction has economic substance for you as an individual taxpayer only if: The transaction changes your economic position in a meaningful way (apart from federal income tax effects), or You have a substantial purpose (apart from federal income tax effects) for entering into the transaction. Efile tax return for free   For purposes of determining whether economic substance exists, a transaction's profit potential will only be taken into account if the present value of the reasonably expected pre-tax profit from the transaction is substantial compared to the present value of the expected net tax benefits that would be allowed if the transaction were respected. Efile tax return for free   If any part of your underpayment is due to any disallowance of claimed tax benefits by reason of a transaction lacking economic substance or failing to meet the requirements of any similar rule of law, that part of your underpayment will be subject to the 20% accuracy-related penalty even if you had a reasonable cause and acted in good faith concerning that part. Efile tax return for free   Additionally, the penalty increases to 40% if you do not adequately disclose on your return or in a statement attached to your return the relevant facts affecting the tax treatment of a transaction that lacks economic substance. Efile tax return for free Relevant facts include any facts affecting the tax treatment of the transaction. Efile tax return for free    Any excessive amount of an erroneous claim for an income tax refund or credit (other than a refund or credit related to the earned income credit) that results from a transaction found to be lacking economic substance will not be treated as having a reasonable basis and could be subject to a 20% penalty. Efile tax return for free Undisclosed foreign financial asset understatement. Efile tax return for free   For tax years beginning after March 18, 2010, you may be liable for a 40% penalty for an understatement of your tax liability due to an undisclosed foreign financial asset. Efile tax return for free An undisclosed foreign financial asset is any asset for which an information return, required to be provided under Internal Revenue Code section 6038, 6038B, 6038D, 6046A, or 6048 for any taxable year, is not provided. Efile tax return for free The penalty applies to any part of an underpayment related to the following undisclosed foreign financial assets. Efile tax return for free Any foreign business you control, reportable on Form 5471, Information Return of U. Efile tax return for free S. Efile tax return for free Persons With Respect To Certain Foreign Corporations, or Form 8865, Return of U. Efile tax return for free S. Efile tax return for free Persons With Respect to Certain Foreign Partnerships. Efile tax return for free Certain transfers of property to a foreign corporation or partnership, reportable on Form 926, Return by a U. Efile tax return for free S. Efile tax return for free Transferor of Property to a Foreign Corporation, or certain distributions to a foreign person, reportable on Form 8865. Efile tax return for free Your ownership interest in certain foreign financial assets, temporarily reportable on Form 8275 or 8275-R. Efile tax return for free    Instead of, or in addition to, Form 8275 or 8275-R, you may have to file Form 8938, Statement of Specified Foreign Financial Assets, with your tax return. Efile tax return for free See the Instructions for Form 8938 for details. Efile tax return for free    Your acquisition, disposition, or substantial change in ownership interest in a foreign partnership, reportable on Form 8865. Efile tax return for free Creation or transfer of money or property to certain foreign trusts, reportable on Form 3520, Annual Return To Report Transactions With Foreign Trusts and Receipt of Certain Foreign Gifts. Efile tax return for free Penalty for incorrect appraisals. Efile tax return for free   The person who prepares an appraisal of the value of property may have to pay a penalty if: He or she knows, or reasonably should have known, that the appraisal would be used in connection with a return or claim for refund; and The claimed value of the property on a return or claim for refund based on that appraisal results in a substantial valuation misstatement or a gross valuation misstatement as discussed earlier. Efile tax return for free For details on the penalty amount and exceptions, see Publication 561. Efile tax return for free Penalty for failure to disclose a reportable transaction. Efile tax return for free   If you fail to include any required information regarding a reportable transaction (discussed earlier) on a return or statement, you may have to pay a penalty of 75% of the decrease in tax shown on your return as a result of such transaction (or that would have resulted if the transaction were respected for federal tax purposes). Efile tax return for free For an individual, the minimum penalty is $5,000 and the maximum is $10,000 (or $100,000 for a listed transaction). Efile tax return for free This penalty is in addition to any other penalty that may be imposed. Efile tax return for free   The IRS may rescind or abate the penalty for failing to disclose a reportable transaction under certain limited circumstances but cannot rescind the penalty for failing to disclose a listed transaction. Efile tax return for free For information on rescission, see Revenue Procedure 2007-21 in Internal Revenue Bulletin 2007-9 available at www. Efile tax return for free irs. Efile tax return for free gov/irb/2007-09_IRB/ar12. Efile tax return for free html. Efile tax return for free Accuracy-related penalty for a reportable transaction understatement. Efile tax return for free   If you have a reportable transaction understatement, you may have to pay a penalty equal to 20% of the amount of that understatement. Efile tax return for free This applies to any item due to a listed transaction or other reportable transaction with a significant purpose of avoiding or evading federal income tax. Efile tax return for free The penalty is 30% rather than 20% for the part of any reportable transaction understatement if the transaction was not properly disclosed. Efile tax return for free You may not have to pay the 20% penalty if you meet the strengthened reasonable cause and good faith exception. Efile tax return for free The reasonable cause and good faith exception does not apply to any part of a reportable transaction understatement attributable to one or more transactions that lack economic substance. Efile tax return for free   This penalty does not apply to the part of an understatement on which the fraud penalty, gross valuation misstatement penalty, or penalty for nondisclosure of noneconomic substance transactions is imposed. Efile tax return for free Civil fraud penalty. Efile tax return for free   If any underpayment of tax on your return is due to fraud, a penalty of 75% of the underpayment will be added to your tax. Efile tax return for free Joint return. Efile tax return for free   The fraud penalty on a joint return applies to a spouse only if some part of the underpayment is due to the fraud of that spouse. Efile tax return for free Failure to pay tax. Efile tax return for free   If a deficiency is assessed and is not paid within 10 days of the demand for payment, an investor can be penalized with up to a 25% addition to tax if the failure to pay continues. Efile tax return for free Whether To Invest In light of the adverse tax consequences and the substantial amount of penalties and interest that will result if the claimed tax benefits are disallowed, you should consider tax shelter investments carefully and seek competent legal and financial advice. Efile tax return for free Prev  Up  Next   Home   More Online Publications