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File Free 2012 Tax Return

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File Free 2012 Tax Return

File free 2012 tax return 6. File free 2012 tax return   Catch-Up Contributions Table of Contents The most that can be contributed to your 403(b) account is the lesser of your limit on annual additions or your limit on elective deferrals. File free 2012 tax return If you will be age 50 or older by the end of the year, you may also be able to make additional catch-up contributions. File free 2012 tax return These additional contributions cannot be made with after-tax employee contributions. File free 2012 tax return You are eligible to make catch-up contributions if: You will have reached age 50 by the end of the year, and The maximum amount of elective deferrals that can be made to your 403(b) account have been made for the plan year. File free 2012 tax return The maximum amount of catch-up contributions is the lesser of: $5,500 for 2013 and unchanged for 2014, or The excess of your compensation for the year, over the elective deferrals that are not catch-up contributions. File free 2012 tax return Figuring catch-up contributions. File free 2012 tax return   When figuring allowable catch-up contributions, combine all catch-up contributions made by your employer on your behalf to the following plans. File free 2012 tax return Qualified retirement plans. File free 2012 tax return (To determine if your plan is a qualified plan, ask your plan administrator. File free 2012 tax return ) 403(b) plans. File free 2012 tax return Simplified employee pension (SEP) plans. File free 2012 tax return SIMPLE plans. File free 2012 tax return   The total amount of the catch-up contributions on your behalf to all plans maintained by your employer cannot be more than the annual limit. File free 2012 tax return For 2013 the limit is $5,500, unchanged for 2014. File free 2012 tax return    If you are eligible for both the 15-year rule increase in elective deferrals and the age 50 catch-up, allocate amounts first under the 15-year rule and next as an age 50 catch-up. File free 2012 tax return    Catch-up contributions do not affect your MAC. File free 2012 tax return Therefore, the maximum amount that you are allowed to have contributed to your 403(b) account is your MAC plus your allowable catch-up contribution. File free 2012 tax return You can use Worksheet C in chapter 9 to figure your limit on catch-up contributions. File free 2012 tax return Prev  Up  Next   Home   More Online Publications
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Understanding your CP11A Notice

We made changes to your return because we believe there's a miscalculation involving your Earned Income Credit. You owe money on your taxes as a result of these changes.

Tax publications you may find useful

How to get help

Calling the toll free 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.
 


What you need to do

  • Read your notice carefully ― it will explain why you owe money on your taxes.
  • Pay the amount owed by the date on the notice's payment coupon.
  • Make payment arrangements if you can't pay the full amount you owe.
  • Contact us within 60 days of the date of your notice if you disagree with the change we made.
  • Correct the copy of your tax return that you kept for your records.

You may want to...


Answers to Common Questions

How can I find out what caused my tax return to change?
Please contact us at the number listed on your notice for specific information concerning your tax return.

What should I do if I disagree with the changes you made?
If you disagree, contact us at the toll free number listed on the top right corner of your notice.

If you contact us in writing within 60 days of the date of this notice, we'll reverse the change we made to your account. However, if you're unable to provide us additional information that justifies the reversal and we believe the reversal is in error, we'll forward your case for audit. This step gives you formal appeal rights, including the right to appeal our decision in court before you have to pay the additional tax. After we forward your case, the audit staff will contact you within five to six weeks to fully explain the audit process and your rights. If you don’t contact us within the 60-day period, you'll lose your right to appeal our decision before payment of tax.

If you don't contact us within 60 days, the change won’t be reversed and you must pay the additional tax. You may then file a claim for refund. You must submit the claim within three years of the date you filed the tax return, or within two years of the date of your last payment for this tax.

What happens if I can’t pay the full amount I owe?
You can arrange to make a payment plan with us if you can’t pay the full amount you owe.

Am I charged interest on the money I owe?
Not if you pay the full amount you owe by the date on the payment coupon. However interest accrues on the unpaid balance after that date.

Will I receive a penalty if I can't pay the full amount?
Yes, you will receive a late payment penalty. You can contact us at the number given on your notice at 1-800-829-0922 if you're unable to pay the full amount shown in your specific notice because of circumstances beyond your control. Contact us by the due date of your payment and, depending on your situation, we may be able to remove the penalty.

What's the difference between the "Child Tax Credit" and the "Additional Child Tax Credit?" Can I qualify for both?
The Child Tax Credit is for people who have a qualifying child and meet the eligibility requirements. The maximum amount you can claim is $1000 for each qualifying child. The Additional Child Tax Credit is for eligible individuals who receive less than the full amount of Child Tax Credit. You may qualify for both the Child Tax Credit and the Additional Child Tax Credit. For more information, see:

How do I claim an Additional Child Tax Credit?
You can claim the credit by completing a Form 1040 Schedule 8812, Child Tax Credit and attaching it to your income tax return.

My child is turning 18 this year. Can I still get the Additional Child Tax Credit?
No. Your child must be under age 17 at the end of 2009 to qualify for both the Child Tax Credit and the Additional Child Tax Credit.


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.

Use the EITC Assistant on our website to help you complete your Schedule EIC, Earned Income Credit and claim your Earned Income Credit.

If you have any dependent children, remember to check out if you are eligible to claim the Child Tax Credit and the Additional Child Tax Credit the next time you file your income tax return. Instructions for claiming the Child Tax Credit are found in the Form 1040 Instruction booklet. Use Form 1040 Schedule 8812, Child Tax Credit to claim the Additional Child Tax Credit, if you are eligible.

Page Last Reviewed or Updated: 28-Mar-2014

The File Free 2012 Tax Return

File free 2012 tax return Publication 529 - Main Content Table of Contents Deductions Subject to the 2% LimitUnreimbursed Employee Expenses Tax Preparation Fees Other Expenses Deductions Not Subject to the 2% LimitList of Deductions Nondeductible ExpensesList of Nondeductible Expenses How To ReportWho can use Form 2106-EZ. File free 2012 tax return Computer used in a home office. File free 2012 tax return Example How To Get Tax HelpLow Income Taxpayer Clinics Deductions Subject to the 2% Limit You can deduct certain expenses as miscellaneous itemized deductions on Schedule A (Form 1040 or Form 1040NR). File free 2012 tax return You can claim the amount of expenses that is more than 2% of your adjusted gross income. File free 2012 tax return You figure your deduction on Schedule A by subtracting 2% of your adjusted gross income from the total amount of these expenses. File free 2012 tax return Your adjusted gross income is the amount on Form 1040, line 38, or Form 1040NR, line 37. File free 2012 tax return Generally, you apply the 2% limit after you apply any other deduction limit. File free 2012 tax return For example, you apply the 50% (or 80%) limit on business-related meals and entertainment (discussed later under Travel, Transportation, Meals, Entertainment, Gifts, and Local Lodging ) before you apply the 2% limit. File free 2012 tax return Deductions subject to the 2% limit are discussed in the following three categories. File free 2012 tax return Unreimbursed employee expenses (Schedule A (Form 1040), line 21 or Schedule A (Form 1040NR), line 7). File free 2012 tax return Tax preparation fees (Schedule A (Form 1040), line 22 or Schedule A (Form 1040NR), line 8). File free 2012 tax return Other expenses (Schedule A (Form 1040), line 23 or Schedule A (Form 1040NR), line 9). File free 2012 tax return Unreimbursed Employee Expenses Generally, the following expenses are deducted on Schedule A (Form 1040), line 21, or Schedule A (Form 1040NR), line 7. File free 2012 tax return You can deduct only unreimbursed employee expenses that are: Paid or incurred during your tax year, For carrying on your trade or business of being an employee, and Ordinary and necessary. File free 2012 tax return An expense is ordinary if it is common and accepted in your trade, business, or profession. File free 2012 tax return An expense is necessary if it is appropriate and helpful to your business. File free 2012 tax return An expense does not have to be required to be considered necessary. File free 2012 tax return You may be able to deduct the following items as unreimbursed employee expenses. File free 2012 tax return Business bad debt of an employee. File free 2012 tax return Business liability insurance premiums. File free 2012 tax return Damages paid to a former employer for breach of an employment contract. File free 2012 tax return Depreciation on a computer your employer requires you to use in your work. File free 2012 tax return Dues to a chamber of commerce if membership helps you do your job. File free 2012 tax return Dues to professional societies. File free 2012 tax return Educator expenses. File free 2012 tax return Home office or part of your home used regularly and exclusively in your work. File free 2012 tax return Job search expenses in your present occupation. File free 2012 tax return Laboratory breakage fees. File free 2012 tax return Legal fees related to your job. File free 2012 tax return Licenses and regulatory fees. File free 2012 tax return Malpractice insurance premiums. File free 2012 tax return Medical examinations required by an employer. File free 2012 tax return Occupational taxes. File free 2012 tax return Passport for a business trip. File free 2012 tax return Repayment of an income aid payment received under an employer's plan. File free 2012 tax return Research expenses of a college professor. File free 2012 tax return Rural mail carriers' vehicle expenses. File free 2012 tax return Subscriptions to professional journals and trade magazines related to your work. File free 2012 tax return Tools and supplies used in your work. File free 2012 tax return Travel, transportation, meals, entertainment, gifts, and local lodging related to your work. File free 2012 tax return Union dues and expenses. File free 2012 tax return Work clothes and uniforms if required and not suitable for everyday use. File free 2012 tax return Work-related education. File free 2012 tax return Business Bad Debt A business bad debt is a loss from a debt created or acquired in your trade or business. File free 2012 tax return Any other worthless debt is a business bad debt only if there is a very close relationship between the debt and your trade or business when the debt becomes worthless. File free 2012 tax return A debt has a very close relationship to your trade or business of being an employee if your main motive for incurring the debt is a business reason. File free 2012 tax return Example. File free 2012 tax return You make a bona fide loan to the corporation you work for. File free 2012 tax return It fails to pay you back. File free 2012 tax return You had to make the loan in order to keep your job. File free 2012 tax return You have a business bad debt as an employee. File free 2012 tax return More information. File free 2012 tax return   For more information on business bad debts, see chapter 10 in Publication 535. File free 2012 tax return For information on nonbusiness bad debts, see chapter 4 in Publication 550, Investment Income and Expenses. File free 2012 tax return Business Liability Insurance You can deduct insurance premiums you paid for protection against personal liability for wrongful acts on the job. File free 2012 tax return Damages for Breach of Employment Contract If you break an employment contract, you can deduct damages you pay your former employer if the damages are attributable to the pay you received from that employer. File free 2012 tax return Depreciation on Computers You can claim a depreciation deduction for a computer that you use in your work as an employee if its use is: For the convenience of your employer, and Required as a condition of your employment. File free 2012 tax return For the convenience of your employer. File free 2012 tax return   This means that your use of the computer is for a substantial business reason of your employer. File free 2012 tax return You must consider all facts in making this determination. File free 2012 tax return Use of your computer during your regular working hours to carry on your employer's business is generally for the convenience of your employer. File free 2012 tax return Required as a condition of your employment. File free 2012 tax return   This means that you cannot properly perform your duties without the computer. File free 2012 tax return Whether you can properly perform your duties without it depends on all the facts and circumstances. File free 2012 tax return It is not necessary that your employer explicitly requires you to use your computer. File free 2012 tax return But neither is it enough that your employer merely states that your use of the item is a condition of your employment. File free 2012 tax return Example. File free 2012 tax return You are an engineer with an engineering firm. File free 2012 tax return You occasionally take work home at night rather than work late at the office. File free 2012 tax return You own and use a computer that is similar to the one you use at the office to complete your work at home. File free 2012 tax return Since your use of the computer is not for the convenience of your employer and is not required as a condition of your employment, you cannot claim a depreciation deduction for it. File free 2012 tax return Which depreciation method to use. File free 2012 tax return   The depreciation method you use depends on whether you meet the more-than-50%-use test. File free 2012 tax return More-than-50%-use test met. File free 2012 tax return   You meet this test if you use the computer more than 50% in your work. File free 2012 tax return If you meet this test, you can claim accelerated depreciation under the General Depreciation System (GDS). File free 2012 tax return In addition, you may be able to take the section 179 deduction for the year you place the item in service. File free 2012 tax return More-than-50%-use test not met. File free 2012 tax return   If you do not meet the more-than-50%-use test, you are limited to the straight line method of depreciation under the Alternative Depreciation System (ADS). File free 2012 tax return You also cannot claim the section 179 deduction. File free 2012 tax return (But if you use your computer in a home office, see the exception below. File free 2012 tax return ) Investment use. File free 2012 tax return   Your use of a computer in connection with investments (described later under Other Expenses ) does not count as use in your work. File free 2012 tax return However, you can combine your investment use with your work use in figuring your depreciation deduction. File free 2012 tax return Exception for computer used in a home office. File free 2012 tax return   The more-than-50%-use test does not apply to a computer used only in a part of your home that meets the requirements described later under Home Office . File free 2012 tax return You can claim accelerated depreciation using GDS for a computer used in a qualifying home office, even if you do not use it more than 50% in your work. File free 2012 tax return You also may be able to take a section 179 deduction for the year you place the computer in service. File free 2012 tax return See Computer used in a home office under How To Report, later. File free 2012 tax return More information. File free 2012 tax return   For more information on depreciation and the section 179 deduction for computers and other items used in a home office, see Business Furniture and Equipment in Publication 587. File free 2012 tax return Publication 946 has detailed information about the section 179 deduction and depreciation deductions using GDS and ADS. File free 2012 tax return Reporting your depreciation deduction. File free 2012 tax return    See How To Report, later, for information about reporting a deduction for depreciation. File free 2012 tax return You must keep records to prove your percentage of business and investment use. File free 2012 tax return Dues to Chambers of Commerce and Professional Societies You may be able to deduct dues paid to professional organizations (such as bar associations and medical associations) and to chambers of commerce and similar organizations, if membership helps you carry out the duties of your job. File free 2012 tax return Similar organizations include: Boards of trade, Business leagues, Civic or public service organizations, Real estate boards, and Trade associations. File free 2012 tax return Lobbying and political activities. File free 2012 tax return    You may not be able to deduct that part of your dues that is for certain lobbying and political activities. File free 2012 tax return See Lobbying Expenses under Nondeductible Expenses, later. File free 2012 tax return Educator Expenses If you were an eligible educator in 2013, you can deduct up to $250 of qualified expenses you paid in 2013 as an adjustment to gross income on Form 1040, line 23, rather than as a miscellaneous itemized deduction. File free 2012 tax return If you file Form 1040A, you can deduct these expenses on line 16. File free 2012 tax return If you and your spouse are filing jointly and both of you were eligible educators, the maximum deduction is $500. File free 2012 tax return However, neither spouse can deduct more than $250 of his or her qualified expenses. File free 2012 tax return Eligible educator. File free 2012 tax return   An eligible educator is a kindergarten through grade 12 teacher, instructor, counselor, principal, or aide in school for at least 900 hours during a school year. File free 2012 tax return Qualified expenses. File free 2012 tax return   Qualified expenses include ordinary and necessary expenses paid in connection with books, supplies, equipment (including computer equipment, software, and services), and other materials used in the classroom. File free 2012 tax return An ordinary expense is one that is common and accepted in your educational field. File free 2012 tax return A necessary expense is one that is helpful and appropriate for your profession as an educator. File free 2012 tax return An expense does not have to be required to be considered necessary. File free 2012 tax return   Qualified expenses do not include expenses for home schooling or for nonathletic supplies for courses in health or physical education. File free 2012 tax return You must reduce your qualified expenses by the following amounts. File free 2012 tax return Excludable U. File free 2012 tax return S. File free 2012 tax return series EE and I savings bond interest from Form 8815. File free 2012 tax return Nontaxable qualified state tuition program earnings. File free 2012 tax return Nontaxable earnings from Coverdell education savings accounts. File free 2012 tax return Any reimbursements you received for those expenses that were not reported to you on your Form W-2, box 1. File free 2012 tax return Educator expenses over limit. File free 2012 tax return   If you were an educator in 2013 and you had qualified expenses that you cannot take as an adjustment to gross income, you can deduct the rest as an itemized deduction subject to the 2% limit. File free 2012 tax return Home Office If you use a part of your home regularly and exclusively for business purposes, you may be able to deduct a part of the operating expenses and depreciation of your home. File free 2012 tax return You can claim this deduction for the business use of a part of your home only if you use that part of your home regularly and exclusively: As your principal place of business for any trade or business, As a place to meet or deal with your patients, clients, or customers in the normal course of your trade or business, or In the case of a separate structure not attached to your home, in connection with your trade or business. File free 2012 tax return The regular and exclusive business use must be for the convenience of your employer and not just appropriate and helpful in your job. File free 2012 tax return Principal place of business. File free 2012 tax return   If you have more than one place of business, the business part of your home is your principal place of business if: You use it regularly and exclusively for administrative or management activities of your trade or business, and You have no other fixed location where you conduct substantial administrative or management activities of your trade or business. File free 2012 tax return   Otherwise, the location of your principal place of business generally depends on the relative importance of the activities performed at each location and the time spent at each location. File free 2012 tax return You should keep records that will give the information needed to figure the deduction according to these rules. File free 2012 tax return Also keep canceled checks, substitute checks, or account statements and receipts of the expenses paid to prove the deductions you claim. File free 2012 tax return More information. File free 2012 tax return   See Publication 587 for more detailed information and a worksheet for figuring the deduction. File free 2012 tax return Job Search Expenses You can deduct certain expenses you have in looking for a new job in your present occupation, even if you do not get a new job. File free 2012 tax return You cannot deduct these expenses if: You are looking for a job in a new occupation, There was a substantial break between the ending of your last job and your looking for a new one, or You are looking for a job for the first time. File free 2012 tax return Employment and outplacement agency fees. File free 2012 tax return    You can deduct employment and outplacement agency fees you pay in looking for a new job in your present occupation. File free 2012 tax return Employer pays you back. File free 2012 tax return   If, in a later year, your employer pays you back for employment agency fees, you must include the amount you receive in your gross income up to the amount of your tax benefit in the earlier year. File free 2012 tax return See Recoveries in Publication 525. File free 2012 tax return Employer pays the employment agency. File free 2012 tax return   If your employer pays the fees directly to the employment agency and you are not responsible for them, you do not include them in your gross income. File free 2012 tax return Résumé. File free 2012 tax return   You can deduct amounts you spend for preparing and mailing copies of a résumé to prospective employers if you are looking for a new job in your present occupation. File free 2012 tax return Travel and transportation expenses. File free 2012 tax return   If you travel to an area and, while there, you look for a new job in your present occupation, you may be able to deduct travel expenses to and from the area. File free 2012 tax return You can deduct the travel expenses if the trip is primarily to look for a new job. File free 2012 tax return The amount of time you spend on personal activity compared to the amount of time you spend in looking for work is important in determining whether the trip is primarily personal or is primarily to look for a new job. File free 2012 tax return   Even if you cannot deduct the travel expenses to and from an area, you can deduct the expenses of looking for a new job in your present occupation while in the area. File free 2012 tax return    You can choose to use the standard mileage rate to figure your car expenses. File free 2012 tax return The 2013 rate for business use of a vehicle is 56½ cents per mile. File free 2012 tax return See Publication 463 for more information on travel and car expenses. File free 2012 tax return Legal Fees You can deduct legal fees related to doing or keeping your job. File free 2012 tax return Licenses and Regulatory Fees You can deduct the amount you pay each year to state or local governments for licenses and regulatory fees for your trade, business, or profession. File free 2012 tax return Occupational Taxes You can deduct an occupational tax charged at a flat rate by a locality for the privilege of working or conducting a business in the locality. File free 2012 tax return If you are an employee, you can claim occupational taxes only as a miscellaneous deduction subject to the 2% limit; you cannot claim them as a deduction for taxes elsewhere on your return. File free 2012 tax return Repayment of Income Aid Payment An “income aid payment” is one that is received under an employer's plan to aid employees who lose their jobs because of lack of work. File free 2012 tax return If you repay a lump-sum income aid payment that you received and included in income in an earlier year, you can deduct the repayment. File free 2012 tax return Research Expenses of a College Professor If you are a college professor, you can deduct your research expenses, including travel expenses, for teaching, lecturing, or writing and publishing on subjects that relate directly to your teaching duties. File free 2012 tax return You must have undertaken the research as a means of carrying out the duties expected of a professor and without expectation of profit apart from salary. File free 2012 tax return However, you cannot deduct the cost of travel as a form of education. File free 2012 tax return Rural Mail Carriers' Vehicle Expenses If your expenses to use a vehicle in performing services as a rural mail carrier are more than the amount of your reimbursements, you can deduct the unreimbursed expenses. File free 2012 tax return See chapter 4 of Publication 463 for more information. File free 2012 tax return Tools Used in Your Work Generally, you can deduct amounts you spend for tools used in your work if the tools wear out and are thrown away within 1 year from the date of purchase. File free 2012 tax return You can depreciate the cost of tools that have a useful life substantially beyond the tax year. File free 2012 tax return For more information about depreciation, see Publication 946. File free 2012 tax return Travel, Transportation, Meals, Entertainment, Gifts, and Local Lodging If you are an employee and have ordinary and necessary business-related expenses for travel away from home, local transportation, entertainment, and gifts, you may be able to deduct these expenses. File free 2012 tax return Generally, you must file Form 2106 or Form 2106-EZ to claim these expenses. File free 2012 tax return Travel expenses. File free 2012 tax return   Travel expenses are those incurred while traveling away from home for your employer. File free 2012 tax return You can deduct travel expenses paid or incurred in connection with a temporary work assignment. File free 2012 tax return Generally, you cannot deduct travel expenses paid or incurred in connection with an indefinite work assignment. File free 2012 tax return   Travel expenses may include: The cost of getting to and from your business destination (air, rail, bus, car, etc. File free 2012 tax return ), Meals and lodging while away from home, Taxi fares, Baggage charges, and Cleaning and laundry expenses. File free 2012 tax return   Travel expenses are discussed more fully in chapter 1 of Publication 463. File free 2012 tax return Temporary work assignment. File free 2012 tax return    If your assignment or job away from home in a single location is realistically expected to last (and does in fact last) for 1 year or less, it is temporary, unless there are facts and circumstances that indicate it is not. File free 2012 tax return Indefinite work assignment. File free 2012 tax return   If your assignment or job away from home in a single location is realistically expected to last for more than 1 year, it is indefinite, whether or not it actually lasts for more than 1 year. File free 2012 tax return If your assignment or job away from home in a single location is realistically expected to last for 1 year or less, but at some later date it is realistically expected to exceed 1 year, it will be treated as temporary (in the absence of facts and circumstances indicating otherwise) until the date that your realistic expectation changes, and it will be treated as indefinite after that date. File free 2012 tax return Federal crime investigation and prosecution. File free 2012 tax return   If you are a federal employee participating in a federal crime investigation or prosecution, you are not subject to the 1-year rule for deducting temporary travel expenses. File free 2012 tax return This means that you may be able to deduct travel expenses even if you are away from your tax home for more than 1 year. File free 2012 tax return   To qualify, the Attorney General must certify that you are traveling: For the Federal Government, In a temporary duty status, and To investigate, prosecute, or provide support services for the investigation or prosecution of a federal crime. File free 2012 tax return Armed Forces reservists traveling more than 100 miles from home. File free 2012 tax return   If you are a member of a reserve component of the Armed Forces of the United States and you travel more than 100 miles away from home in connection with your performance of services as a member of the reserves, you can deduct some of your travel expenses as an adjustment to gross income rather than as a miscellaneous itemized deduction. File free 2012 tax return The amount of expenses you can deduct as an adjustment to gross income is limited to the regular federal per diem rate (for lodging, meals, and incidental expenses) and the standard mileage rate (for car expenses) plus any parking fees, ferry fees, and tolls. File free 2012 tax return The balance, if any, is reported on Schedule A. File free 2012 tax return   You are a member of a reserve component of the Armed Forces of the United States if you are in the Army, Naval, Marine Corps, Air Force, Coast Guard Reserve, the Army National Guard of the United States, the Air National Guard of the United States, or the Reserve Corps of the Public Health Service. File free 2012 tax return   For more information on travel expenses, see Publication 463. File free 2012 tax return Local transportation expenses. File free 2012 tax return   Local transportation expenses are the expenses of getting from one workplace to another when you are not traveling away from home. File free 2012 tax return They include the cost of transportation by air, rail, bus, taxi, and the cost of using your car. File free 2012 tax return   You can choose to use the standard mileage rate to figure your car expenses. File free 2012 tax return The 2013 rate for business use of a vehicle is 56½ cents per mile. File free 2012 tax return    In general, the costs of commuting between your residence and your place of business are nondeductible. File free 2012 tax return Work at two places in a day. File free 2012 tax return   If you work at two places in a day, whether or not for the same employer, you can generally deduct the expenses of getting from one workplace to the other. File free 2012 tax return Temporary work location. File free 2012 tax return   You can deduct expenses incurred in going between your home and a temporary work location if at least one of the following applies. File free 2012 tax return The work location is outside the metropolitan area where you live and normally work. File free 2012 tax return You have at least one regular work location (other than your home) for the same trade or business. File free 2012 tax return (If this applies, the distance between your home and the temporary work location does not matter. File free 2012 tax return )   For this purpose, a work location is generally considered temporary if your work there is realistically expected to last (and does in fact last) for 1 year or less. File free 2012 tax return It is not temporary if your work there is realistically expected to last for more than 1 year, even if it actually lasts for 1 year or less. File free 2012 tax return If your work there initially is realistically expected to last for 1 year or less, but later is realistically expected to last for more than 1 year, the work location is generally considered temporary until the date your realistic expectation changes and not temporary after that date. File free 2012 tax return For more information, see chapter 1 of Publication 463. File free 2012 tax return Home office. File free 2012 tax return   You can deduct expenses incurred in going between your home and a workplace if your home is your principal place of business for the same trade or business. File free 2012 tax return (In this situation, whether the other workplace is temporary or regular and its distance from your home do not matter. File free 2012 tax return ) See Home Office , earlier, for a discussion on the use of your home as your principal place of business. File free 2012 tax return Meals and entertainment. File free 2012 tax return   Generally, you can deduct entertainment expenses (including entertainment-related meals) only if they are directly related to the active conduct of your trade or business. File free 2012 tax return However, the expense only needs to be associated with the active conduct of your trade or business if it directly precedes or follows a substantial and bona fide business-related discussion. File free 2012 tax return   You can deduct only 50% of your business-related meal and entertainment expenses unless the expenses meet certain exceptions. File free 2012 tax return You apply this 50% limit before you apply the 2%-of-adjusted-gross-income limit. File free 2012 tax return Meals when subject to “hours of service” limits. File free 2012 tax return   You can deduct 80% of your business-related meal expenses if you consume the meals during or incident to any period subject to the Department of Transportation's “hours of service” limits. File free 2012 tax return You apply this 80% limit before you apply the 2%-of-adjusted-gross-income limit. File free 2012 tax return Gift expenses. File free 2012 tax return   You can generally deduct up to $25 of business gifts you give to any one individual during the year. File free 2012 tax return The following items do not count toward the $25 limit. File free 2012 tax return Identical, widely distributed items costing $4 or less that have your name clearly and permanently imprinted. File free 2012 tax return Signs, racks, and promotional materials to be displayed on the business premises of the recipient. File free 2012 tax return Local lodging. File free 2012 tax return   If your employer provides or requires you to obtain lodging while you are not traveling away from home, you can deduct the cost of the lodging if it is: on a temporary basis, necessary for you to participate in or be available for a business meeting or employer function, and the costs are ordinary and necessary, but not lavish or extravagant. File free 2012 tax return   If your employer provides the lodging or reimburses you for the cost of the lodging, you can deduct the cost only if the value or the reimbursement is included in your gross income because it is reported as wages on your Form W-2. File free 2012 tax return Additional information. File free 2012 tax return    See Publication 463 for more information on travel, transportation, meal, entertainment, and gift expenses, and reimbursements for these expenses. File free 2012 tax return Union Dues and Expenses You can deduct dues and initiation fees you pay for union membership. File free 2012 tax return You can also deduct assessments for benefit payments to unemployed union members. File free 2012 tax return However, you cannot deduct the part of the assessments or contributions that provides funds for the payment of sick, accident, or death benefits. File free 2012 tax return Also, you cannot deduct contributions to a pension fund even if the union requires you to make the contributions. File free 2012 tax return You may not be able to deduct amounts you pay to the union that are related to certain lobbying and political activities. File free 2012 tax return See Lobbying Expenses under Nondeductible Expenses, later. File free 2012 tax return Work Clothes and Uniforms You can deduct the cost and upkeep of work clothes if the following two requirements are met. File free 2012 tax return You must wear them as a condition of your employment. File free 2012 tax return The clothes are not suitable for everyday wear. File free 2012 tax return It is not enough that you wear distinctive clothing. File free 2012 tax return The clothing must be specifically required by your employer. File free 2012 tax return Nor is it enough that you do not, in fact, wear your work clothes away from work. File free 2012 tax return The clothing must not be suitable for taking the place of your regular clothing. File free 2012 tax return Examples of workers who may be able to deduct the cost and upkeep of work clothes are: delivery workers, firefighters, health care workers, law enforcement officers, letter carriers, professional athletes, and transportation workers (air, rail, bus, etc. File free 2012 tax return ). File free 2012 tax return Musicians and entertainers can deduct the cost of theatrical clothing and accessories that are not suitable for everyday wear. File free 2012 tax return However, work clothing consisting of white cap, white shirt or white jacket, white bib overalls, and standard work shoes, which a painter is required by his union to wear on the job, is not distinctive in character or in the nature of a uniform. File free 2012 tax return Similarly, the costs of buying and maintaining blue work clothes worn by a welder at the request of a foreman are not deductible. File free 2012 tax return Protective clothing. File free 2012 tax return   You can deduct the cost of protective clothing required in your work, such as safety shoes or boots, safety glasses, hard hats, and work gloves. File free 2012 tax return   Examples of workers who may be required to wear safety items are: carpenters, cement workers, chemical workers, electricians, fishing boat crew members, machinists, oil field workers, pipe fitters, steamfitters, and truck drivers. File free 2012 tax return Military uniforms. File free 2012 tax return   You generally cannot deduct the cost of your uniforms if you are on full-time active duty in the armed forces. File free 2012 tax return However, if you are an armed forces reservist, you can deduct the unreimbursed cost of your uniform if military regulations restrict you from wearing it except while on duty as a reservist. File free 2012 tax return In figuring the deduction, you must reduce the cost by any nontaxable allowance you receive for these expenses. File free 2012 tax return   If local military rules do not allow you to wear fatigue uniforms when you are off duty, you can deduct the amount by which the cost of buying and keeping up these uniforms is more than the uniform allowance you receive. File free 2012 tax return   If you are a student at an armed forces academy, you cannot deduct the cost of your uniforms if they replace regular clothing. File free 2012 tax return However, you can deduct the cost of insignia, shoulder boards, and related items. File free 2012 tax return    You can deduct the cost of your uniforms if you are a civilian faculty or staff member of a military school. File free 2012 tax return Work-Related Education You can deduct expenses you have for education, even if the education may lead to a degree, if the education meets at least one of the following two tests. File free 2012 tax return It maintains or improves skills required in your present work. File free 2012 tax return It is required by your employer or the law to keep your salary, status, or job, and the requirement serves a business purpose of your employer. File free 2012 tax return You cannot deduct expenses you have for education, even though one or both of the preceding tests are met, if the education: Is needed to meet the minimum educational requirements to qualify you in your trade or business, or Is part of a program of study that will lead to qualifying you in a new trade or business. File free 2012 tax return If your education qualifies, you can deduct expenses for tuition, books, supplies, laboratory fees, and similar items, and certain transportation costs. File free 2012 tax return If the education qualifies you for a new trade or business, you cannot deduct the educational expenses even if you do not intend to enter that trade or business. File free 2012 tax return Travel as education. File free 2012 tax return   You cannot deduct the cost of travel that in itself constitutes a form of education. File free 2012 tax return For example, a French teacher who travels to France to maintain general familiarity with the French language and culture cannot deduct the cost of the trip as an educational expense. File free 2012 tax return More information. File free 2012 tax return    See Publication 970, Tax Benefits for Education, for a complete discussion of the deduction for work-related education expenses. File free 2012 tax return Education Expenses During Unemployment If you stop working for a year or less in order to get education in order to maintain or improve skills needed in your present work and then return to the same general type of work, your absence is considered temporary. File free 2012 tax return Education that you get during a temporary absence is qualifying work-related education if it maintains or improves skills needed in your present work. File free 2012 tax return Tax Preparation Fees You can usually deduct tax preparation fees on the return for the year in which you pay them. File free 2012 tax return Thus, on your 2013 return, you can deduct fees paid in 2013 for preparing your 2012 return. File free 2012 tax return These fees include the cost of tax preparation software programs and tax publications. File free 2012 tax return They also include any fee you paid for electronic filing of your return. File free 2012 tax return See Tax preparation fees under How To Report, later. File free 2012 tax return Other Expenses You can deduct certain other expenses as miscellaneous itemized deductions subject to the 2%-of-adjusted-gross-income limit. File free 2012 tax return On Schedule A (Form 1040), line 23, or Schedule A (Form 1040NR), line 9, you can deduct the ordinary and necessary expenses that you pay: To produce or collect income that must be included in your gross income, To manage, conserve, or maintain property held for producing such income, or To determine, contest, pay, or claim a refund of any tax. File free 2012 tax return You can deduct expenses you pay for the purposes in (1) and (2) above only if they are reasonable and closely related to these purposes. File free 2012 tax return These other expenses include the following items. File free 2012 tax return Appraisal fees for a casualty loss or charitable contribution. File free 2012 tax return Casualty and theft losses from property used in performing services as an employee. File free 2012 tax return Clerical help and office rent in caring for investments. File free 2012 tax return Depreciation on home computers used for investments. File free 2012 tax return Excess deductions (including administrative expenses) allowed a beneficiary on termination of an estate or trust. File free 2012 tax return Fees to collect interest and dividends. File free 2012 tax return Hobby expenses, but generally not more than hobby income. File free 2012 tax return Indirect miscellaneous deductions from pass-through entities. File free 2012 tax return Investment fees and expenses. File free 2012 tax return Legal fees related to producing or collecting taxable income or getting tax advice. File free 2012 tax return Loss on deposits in an insolvent or bankrupt financial institution. File free 2012 tax return Loss on traditional IRAs or Roth IRAs, when all amounts have been distributed to you. File free 2012 tax return Repayments of income. File free 2012 tax return Repayments of social security benefits. File free 2012 tax return Safe deposit box rental, except for storing jewelry and other personal effects. File free 2012 tax return Service charges on dividend reinvestment plans. File free 2012 tax return Tax advice fees. File free 2012 tax return Trustee's fees for your IRA, if separately billed and paid. File free 2012 tax return If the expenses you pay produce income that is only partially taxable, see Tax-Exempt Income Expenses, later, under Nondeductible Expenses. File free 2012 tax return Appraisal Fees You can deduct appraisal fees if you pay them to figure a casualty loss or the fair market value of donated property. File free 2012 tax return Casualty and Theft Losses You can deduct a casualty or theft loss as a miscellaneous itemized deduction subject to the 2% limit if you used the damaged or stolen property in performing services as an employee. File free 2012 tax return First report the loss in Section B of Form 4684, Casualties and Thefts. File free 2012 tax return You may also have to include the loss on Form 4797, Sales of Business Property, if you are otherwise required to file that form. File free 2012 tax return To figure your deduction, add all casualty or theft losses from this type of property included on Form 4684, lines 32 and 38b, or Form 4797, line 18a. File free 2012 tax return For more information on casualty and theft losses, see Publication 547, Casualties, Disasters, and Thefts. File free 2012 tax return Clerical Help and Office Rent You can deduct office expenses, such as rent and clerical help, that you have in connection with your investments and collecting the taxable income on them. File free 2012 tax return Credit or Debit Card Convenience Fees You can deduct the convenience fee charged by the card processor for paying your income tax (including estimated tax payments) by credit or debit card. File free 2012 tax return The fees are deductible on the return for the year in which you paid them. File free 2012 tax return For example, fees charged to payments made in 2013 can be claimed on the 2013 tax return. File free 2012 tax return Depreciation on Home Computer You can deduct depreciation on your home computer if you use it to produce income (for example, to manage your investments that produce taxable income). File free 2012 tax return You generally must depreciate the computer using the straight line method over the Alternative Depreciation System (ADS) recovery period. File free 2012 tax return But if you work as an employee and also use the computer in that work, see Depreciation on Computers under Unreimbursed Employee Expenses, earlier. File free 2012 tax return For more information on depreciation, see Publication 946. File free 2012 tax return Excess Deductions of an Estate If an estate's total deductions in its last tax year are more than its gross income for that year, the beneficiaries succeeding to the estate's property can deduct the excess. File free 2012 tax return Do not include deductions for the estate's personal exemption and charitable contributions when figuring the estate's total deductions. File free 2012 tax return The beneficiaries can claim the deduction only for the tax year in which, or with which, the estate terminates, whether the year of termination is a normal year or a short tax year. File free 2012 tax return For more information, see Termination of Estate in Publication 559, Survivors, Executors, and Administrators. File free 2012 tax return Fees To Collect Interest and Dividends You can deduct fees you pay to a broker, bank, trustee, or similar agent to collect your taxable bond interest or dividends on shares of stock. File free 2012 tax return But you cannot deduct a fee you pay to a broker to buy investment property, such as stocks or bonds. File free 2012 tax return You must add the fee to the cost of the property. File free 2012 tax return You cannot deduct the fee you pay to a broker to sell securities. File free 2012 tax return You can use the fee only to figure gain or loss from the sale. File free 2012 tax return See the instructions for Schedule D (Form 1040) for information on how to report the fee. File free 2012 tax return Hobby Expenses You can generally deduct hobby expenses, but only up to the amount of hobby income. File free 2012 tax return A hobby is not a business because it is not carried on to make a profit. File free 2012 tax return See Not-for-Profit Activities in chapter 1 of Publication 535. File free 2012 tax return Indirect Deductions of Pass-Through Entities Pass-through entities include partnerships, S corporations, and mutual funds that are not publicly offered. File free 2012 tax return Deductions of pass-through entities are passed through to the partners or shareholders. File free 2012 tax return The partners or shareholders can deduct their share of passed-through deductions for investment expenses as miscellaneous itemized deductions subject to the 2% limit. File free 2012 tax return Example. File free 2012 tax return You are a member of an investment club that is formed solely to invest in securities. File free 2012 tax return The club is treated as a partnership. File free 2012 tax return The partnership's income is solely from taxable dividends, interest, and gains from sales of securities. File free 2012 tax return In this case, you can deduct your share of the partnership's operating expenses as miscellaneous itemized deductions subject to the 2% limit. File free 2012 tax return However, if the investment club partnership has investments that also produce nontaxable income, you cannot deduct your share of the partnership's expenses that produce the nontaxable income. File free 2012 tax return Publicly offered mutual funds. File free 2012 tax return   Publicly offered mutual funds do not pass deductions for investment expenses through to shareholders. File free 2012 tax return A mutual fund is “publicly offered” if it is: Continuously offered pursuant to a public offering, Regularly traded on an established securities market, or Held by or for at least 500 persons at all times during the tax year. File free 2012 tax return   A publicly offered mutual fund will send you a Form 1099-DIV, Dividends and Distributions, or a substitute form, showing the net amount of dividend income (gross dividends minus investment expenses). File free 2012 tax return This net figure is the amount you report on your return as income. File free 2012 tax return You cannot further deduct investment expenses related to publicly offered mutual funds because they are already included as part of the net income amount. File free 2012 tax return Information returns. File free 2012 tax return   You should receive information returns from pass-through entities. File free 2012 tax return Partnerships and S corporations. File free 2012 tax return   These entities issue Schedule K-1, which lists the items and amounts you must report, and identifies the tax return schedules and lines to use. File free 2012 tax return Nonpublicly offered mutual funds. File free 2012 tax return   These funds will send you a Form 1099-DIV, or a substitute form, showing your share of gross income and investment expenses. File free 2012 tax return You can claim the expenses only as a miscellaneous itemized deduction subject to the 2% limit. File free 2012 tax return Investment Fees and Expenses You can deduct investment fees, custodial fees, trust administration fees, and other expenses you paid for managing your investments that produce taxable income. File free 2012 tax return Legal Expenses You can usually deduct legal expenses that you incur in attempting to produce or collect taxable income or that you pay in connection with the determination, collection, or refund of any tax. File free 2012 tax return You can also deduct legal expenses that are: Related to either doing or keeping your job, such as those you paid to defend yourself against criminal charges arising out of your trade or business, For tax advice related to a divorce if the bill specifies how much is for tax advice and it is determined in a reasonable way, or To collect taxable alimony. File free 2012 tax return You can deduct expenses of resolving tax issues relating to profit or loss from business (Schedule C or C-EZ), rentals or royalties (Schedule E), or farm income and expenses (Schedule F) on the appropriate schedule. File free 2012 tax return You deduct expenses of resolving nonbusiness tax issues on Schedule A (Form 1040 or Form 1040NR). File free 2012 tax return See Tax Preparation Fees, earlier. File free 2012 tax return Unlawful discrimination claims. File free 2012 tax return   You may be able to deduct, as an adjustment to income on Form 1040, line 36, or Form 1040NR, line 35, rather than as a miscellaneous itemized deduction, attorney fees and court costs for actions settled or decided after October 22, 2004, involving a claim of unlawful discrimination, a claim against the U. File free 2012 tax return S. File free 2012 tax return Government, or a claim made under section 1862(b)(3)(A) of the Social Security Act. File free 2012 tax return However, the amount you can deduct on Form 1040, line 36, or Form 1040NR, line 35, is limited to the amount of the judgment or settlement you are including in income for the tax year. File free 2012 tax return See Publication 525 for more information. File free 2012 tax return Loss on Deposits A loss on deposits can occur when a bank, credit union, or other financial institution becomes insolvent or bankrupt. File free 2012 tax return If you can reasonably estimate the amount of your loss on money you have on deposit in a financial institution that becomes insolvent or bankrupt, you can generally choose to deduct it in the current year even though its exact amount has not been finally determined. File free 2012 tax return If elected, the casualty loss is subject to certain deduction limitations. File free 2012 tax return The election is made on Form 4684. File free 2012 tax return Once you make this choice, you cannot change it without IRS approval. File free 2012 tax return If none of the deposit is federally insured, you can deduct the loss in either of the following ways. File free 2012 tax return As an ordinary loss (as a miscellaneous itemized deduction subject to the 2% limit). File free 2012 tax return Write the name of the financial institution and “Insolvent Financial Institution” beside the amount on Schedule A (Form 1040), line 23, or Schedule A (Form 1040NR), line 9. File free 2012 tax return This deduction is limited to $20,000 ($10,000 if you are married filing separately) for each financial institution, reduced by any expected state insurance proceeds. File free 2012 tax return As a casualty loss. File free 2012 tax return Report it on Form 4684 first and then on Schedule A (Form 1040). File free 2012 tax return See Publication 547 for details. File free 2012 tax return As a nonbusiness bad debt. File free 2012 tax return Report it on Schedule D (Form 1040). File free 2012 tax return If any part of the deposit is federally insured, you can deduct the loss only as a casualty loss. File free 2012 tax return Exception. File free 2012 tax return   You cannot make this choice if you are a 1%-or-more-owner or an officer of the financial institution, or are related to such owner or officer. File free 2012 tax return For a definition of “related,” see Deposit in Insolvent or Bankrupt Financial Institution in chapter 4 of Publication 550. File free 2012 tax return Actual loss different from estimated loss. File free 2012 tax return   If you make this choice and your actual loss is less than your estimated loss, you must include the excess in income. File free 2012 tax return See Recoveries in Publication 525. File free 2012 tax return If your actual loss is more than your estimated loss, treat the excess loss as explained under Choice not made, next. File free 2012 tax return Choice not made. File free 2012 tax return   If you do not make this choice (or if you have an excess actual loss after choosing to deduct your estimated loss), treat your loss (or excess loss) as a nonbusiness bad debt (deductible as a short-term capital loss) in the year its amount is finally determined. File free 2012 tax return See Nonbusiness Bad Debts in chapter 4 of Publication 550. File free 2012 tax return Loss on IRA If you have a loss on your traditional IRA (or Roth IRA) investment, you can deduct the loss as a miscellaneous itemized deduction subject to the 2% limit, but only when all the amounts in all your traditional IRA (or Roth IRA) accounts have been distributed to you and the total distributions are less than your unrecovered basis. File free 2012 tax return For more information, see Publication 590, Individual Retirement Arrangements (IRAs). File free 2012 tax return Repayments of Income If you had to repay an amount that you included in income in an earlier year, you may be able to deduct the amount you repaid. File free 2012 tax return If the amount you had to repay was ordinary income of $3,000 or less, the deduction is subject to the 2% limit. File free 2012 tax return If it was more than $3,000, see Repayments Under Claim of Right under Deductions Not Subject to the 2% Limit, later. File free 2012 tax return Repayments of Social Security Benefits If the total of the amounts in box 5 (net benefits for 2013) of all your Forms SSA-1099, Social Security Benefit Statement, and Forms RRB-1099, Payments By the Railroad Retirement Board, is a negative figure (a figure in parentheses), you may be able to take a miscellaneous itemized deduction subject to the 2% limit. File free 2012 tax return The amount you can deduct is the part of the negative figure that represents an amount you included in gross income in an earlier year. File free 2012 tax return The amount in box 5 of Form SSA-1099 or RRB-1099 is the net amount of your benefits for the year. File free 2012 tax return It will be a negative figure if the amount of benefits you repaid in 2013 (box 4) is more than the gross amount of benefits paid to you in 2013 (box 3). File free 2012 tax return If the deduction is more than $3,000, you will have to use a special computation to figure your tax. File free 2012 tax return See Publication 915, Social Security and Equivalent Railroad Retirement Benefits, for additional information. File free 2012 tax return Safe Deposit Box Rent You can deduct safe deposit box rent if you use the box to store taxable income-producing stocks, bonds, or investment-related papers and documents. File free 2012 tax return You cannot deduct the rent if you use the box only for jewelry, other personal items, or tax-exempt securities. File free 2012 tax return Service Charges on Dividend Reinvestment Plans You can deduct service charges you pay as a subscriber in a dividend reinvestment plan. File free 2012 tax return These service charges include payments for: Holding shares acquired through a plan, Collecting and reinvesting cash dividends, and Keeping individual records and providing detailed statements of accounts. File free 2012 tax return Trustee's Administrative Fees for IRA Trustee's administrative fees that are billed separately and paid by you in connection with your IRA are deductible (if they are ordinary and necessary) as a miscellaneous itemized deduction subject to the 2% limit. File free 2012 tax return Deductions Not Subject to the 2% Limit You can deduct the items listed below as miscellaneous itemized deductions. File free 2012 tax return They are not subject to the 2% limit. File free 2012 tax return Report these items on Schedule A (Form 1040), line 28, or Schedule A (Form 1040NR), line 14. File free 2012 tax return List of Deductions Amortizable premium on taxable bonds. File free 2012 tax return Casualty and theft losses from income-producing property. File free 2012 tax return Federal estate tax on income in respect of a decedent. File free 2012 tax return Gambling losses up to the amount of gambling winnings. File free 2012 tax return Impairment-related work expenses of persons with disabilities. File free 2012 tax return Loss from other activities from Schedule K-1 (Form 1065-B), box 2. File free 2012 tax return Losses from Ponzi-type investment schemes. File free 2012 tax return Repayments of more than $3,000 under a claim of right. File free 2012 tax return Unrecovered investment in an annuity. File free 2012 tax return Amortizable Premium on Taxable Bonds In general, if the amount you pay for a bond is greater than its stated principal amount, the excess is bond premium. File free 2012 tax return You can elect to amortize the premium on taxable bonds. File free 2012 tax return The amortization of the premium is generally an offset to interest income on the bond rather than a separate deduction item. File free 2012 tax return Pre-1998 election to amortize bond premium. File free 2012 tax return   Generally, if you first elected to amortize bond premium before 1998, the above treatment of the premium does not apply to bonds you acquired before 1988. File free 2012 tax return Bonds acquired after October 22, 1986, and before 1988. File free 2012 tax return   The amortization of the premium on these bonds is investment interest expense subject to the investment interest limit, unless you chose to treat it as an offset to interest income on the bond. File free 2012 tax return Bonds acquired before October 23, 1986. File free 2012 tax return   The amortization of the premium on these bonds is a miscellaneous itemized deduction not subject to the 2% limit. File free 2012 tax return Deduction for excess premium. File free 2012 tax return   On certain bonds (such as bonds that pay a variable rate of interest or that provide for an interest-free period), the amount of bond premium allocable to a period may exceed the amount of stated interest allocable to the period. File free 2012 tax return If this occurs, treat the excess as a miscellaneous itemized deduction that is not subject to the 2% limit. File free 2012 tax return However, the amount deductible is limited to the amount by which your total interest inclusions on the bond in prior periods exceed the total amount you treated as a bond premium deduction on the bond in prior periods. File free 2012 tax return If any of the excess bond premium cannot be deducted because of the limit, this amount is carried forward to the next period and is treated as bond premium allocable to that period. File free 2012 tax return    Pre-1998 choice to amortize bond premium. File free 2012 tax return If you made the choice to amortize the premium on taxable bonds before 1998, you can deduct the bond premium amortization that is more than your interest income only for bonds acquired during 1998 and later years. File free 2012 tax return More information. File free 2012 tax return    For more information on bond premium, see Bond Premium Amortization in chapter 3 of Publication 550. File free 2012 tax return Casualty and Theft Losses of Income-Producing Property You can deduct a casualty or theft loss as a miscellaneous itemized deduction not subject to the 2% limit if the damaged or stolen property was income-producing property (property held for investment, such as stocks, notes, bonds, gold, silver, vacant lots, and works of art). File free 2012 tax return First report the loss in Section B of Form 4684. File free 2012 tax return You may also have to include the loss on Form 4797, Sales of Business Property, if you are otherwise required to file that form. File free 2012 tax return To figure your deduction, add all casualty or theft losses from this type of property included on Form 4684, lines 32 and 38b, or Form 4797, line 18a. File free 2012 tax return For more information on casualty and theft losses, see Publication 547. File free 2012 tax return Federal Estate Tax on Income in Respect of a Decedent You can deduct the federal estate tax attributable to income in respect of a decedent that you as a beneficiary include in your gross income. File free 2012 tax return Income in respect of the decedent is gross income that the decedent would have received had death not occurred and that was not properly includible in the decedent's final income tax return. File free 2012 tax return See Publication 559 for information about figuring the amount of this deduction. File free 2012 tax return Gambling Losses Up to the Amount of Gambling Winnings You must report the full amount of your gambling winnings for the year on Form 1040, line 21. File free 2012 tax return You deduct your gambling losses for the year on Schedule A (Form 1040), line 28. File free 2012 tax return You cannot deduct gambling losses that are more than your winnings. File free 2012 tax return Generally, nonresident aliens cannot deduct gambling losses on Schedule A (Form 1040NR). File free 2012 tax return You cannot reduce your gambling winnings by your gambling losses and report the difference. File free 2012 tax return You must report the full amount of your winnings as income and claim your losses (up to the amount of winnings) as an itemized deduction. File free 2012 tax return Therefore, your records should show your winnings separately from your losses. File free 2012 tax return Diary of winnings and losses. File free 2012 tax return You must keep an accurate diary or similar record of your losses and winnings. File free 2012 tax return Your diary should contain at least the following information. File free 2012 tax return The date and type of your specific wager or wagering activity. File free 2012 tax return The name and address or location of the gambling establishment. File free 2012 tax return The names of other persons present with you at the gambling establishment. File free 2012 tax return The amount(s) you won or lost. File free 2012 tax return Proof of winnings and losses. File free 2012 tax return   In addition to your diary, you should also have other documentation. File free 2012 tax return You can generally prove your winnings and losses through Form W-2G, Certain Gambling Winnings, Form 5754, Statement by Person(s) Receiving Gambling Winnings, wagering tickets, canceled checks, substitute checks, credit records, bank withdrawals, and statements of actual winnings or payment slips provided to you by the gambling establishment. File free 2012 tax return   For specific wagering transactions, you can use the following items to support your winnings and losses. File free 2012 tax return    These recordkeeping suggestions are intended as general guidelines to help you establish your winnings and losses. File free 2012 tax return They are not all-inclusive. File free 2012 tax return Your tax liability depends on your particular facts and circumstances. File free 2012 tax return Keno. File free 2012 tax return   Copies of the keno tickets you purchased that were validated by the gambling establishment, copies of your casino credit records, and copies of your casino check cashing records. File free 2012 tax return Slot machines. File free 2012 tax return   A record of the machine number and all winnings by date and time the machine was played. File free 2012 tax return Table games (twenty-one (blackjack), craps, poker, baccarat, roulette, wheel of fortune, etc. File free 2012 tax return ). File free 2012 tax return   The number of the table at which you were playing. File free 2012 tax return Casino credit card data indicating whether the credit was issued in the pit or at the cashier's cage. File free 2012 tax return Bingo. File free 2012 tax return   A record of the number of games played, cost of tickets purchased, and amounts collected on winning tickets. File free 2012 tax return Supplemental records include any receipts from the casino, parlor, etc. File free 2012 tax return Racing (horse, harness, dog, etc. File free 2012 tax return ). File free 2012 tax return   A record of the races, amounts of wagers, amounts collected on winning tickets, and amounts lost on losing tickets. File free 2012 tax return Supplemental records include unredeemed tickets and payment records from the racetrack. File free 2012 tax return Lotteries. File free 2012 tax return   A record of ticket purchases, dates, winnings, and losses. File free 2012 tax return Supplemental records include unredeemed tickets, payment slips, and winnings statements. File free 2012 tax return Impairment-Related Work Expenses If you have a physical or mental disability that limits your being employed, or substantially limits one or more of your major life activities, such as performing manual tasks, walking, speaking, breathing, learning, and working, you can deduct your impairment-related work expenses. File free 2012 tax return Impairment-related work expenses are ordinary and necessary business expenses for attendant care services at your place of work and other expenses in connection with your place of work that are necessary for you to be able to work. File free 2012 tax return Example. File free 2012 tax return You are blind. File free 2012 tax return You must use a reader to do your work. File free 2012 tax return You use the reader both during your regular working hours at your place of work and outside your regular working hours away from your place of work. File free 2012 tax return The reader's services are only for your work. File free 2012 tax return You can deduct your expenses for the reader as impairment-related work expenses. File free 2012 tax return Self-employed. File free 2012 tax return   If you are self-employed, enter your impairment-related work expenses on the appropriate form (Schedule C, C-EZ, E, or F) used to report your business income and expenses. File free 2012 tax return See Impairment-related work expenses. File free 2012 tax return , later under How To Report. File free 2012 tax return Loss From Other Activities From Schedule K-1 (Form 1065-B), Box 2 If the amount reported in Schedule K-1 (Form 1065-B), box 2, is a loss, report it on Schedule A (Form 1040), line 28, or Schedule A (Form 1040NR), line 14 (only if effectively connected with a U. File free 2012 tax return S. File free 2012 tax return trade or business). File free 2012 tax return It is not subject to the passive activity limitations. File free 2012 tax return Officials Paid on a Fee Basis If you are a fee-basis official, you can claim your expenses in performing services in that job as an adjustment to income rather than as a miscellaneous itemized deduction. File free 2012 tax return See Publication 463 for more information. File free 2012 tax return Performing Artists If you are a qualified performing artist, you can deduct your employee business expenses as an adjustment to income rather than as a miscellaneous itemized deduction. File free 2012 tax return If you are an employee, complete Form 2106 or Form 2106-EZ. File free 2012 tax return See Publication 463 for more information. File free 2012 tax return Losses From Ponzi-type Investment Schemes These losses are deductible as theft losses of income-producing property on your tax return for the year the loss was discovered. File free 2012 tax return You figure the deductible loss in Section B of Form 4684. File free 2012 tax return However, if you qualify to use Revenue Procedure 2009-20 (as modified by Revenue Procedure 2011-58) and you choose to follow the procedures in the guidance, complete Section C of Form 4684 before completing Section B. File free 2012 tax return Section C of Form 4684 replaces Appendix A in Revenue Procedure 2009-20. File free 2012 tax return You do not need to complete Appendix A. File free 2012 tax return See the Form 4684 instructions and Publication 547, Casualties, Disasters, and Thefts, for more information. File free 2012 tax return Repayments Under Claim of Right If you had to repay more than $3,000 that you included in your income in an earlier year because at the time you thought you had an unrestricted right to it, you may be able to deduct the amount you repaid, or take a credit against your tax. File free 2012 tax return See Repayments in Publication 525 for more information. File free 2012 tax return Unrecovered Investment in Annuity A retiree who contributed to the cost of an annuity can exclude from income a part of each payment received as a tax-free return of the retiree's investment. File free 2012 tax return If the retiree dies before the entire investment is recovered tax free, any unrecovered investment can be deducted on the retiree's final income tax return. File free 2012 tax return See Publication 575, Pension and Annuity Income, for more information about the tax treatment of pensions and annuities. File free 2012 tax return Nondeductible Expenses You cannot deduct the following expenses. File free 2012 tax return List of Nondeductible Expenses Adoption expenses. File free 2012 tax return Broker's commissions. File free 2012 tax return Burial or funeral expenses, including the cost of a cemetery lot. File free 2012 tax return Campaign expenses. File free 2012 tax return Capital expenses. File free 2012 tax return Check-writing fees. File free 2012 tax return Club dues. File free 2012 tax return Commuting expenses. File free 2012 tax return Fees and licenses, such as car licenses, marriage licenses, and dog tags. File free 2012 tax return Fines and penalties, such as parking tickets. File free 2012 tax return Health spa expenses. File free 2012 tax return Hobby losses—but see Hobby Expenses, earlier. File free 2012 tax return Home repairs, insurance, and rent. File free 2012 tax return Home security system. File free 2012 tax return Illegal bribes and kickbacks—see Bribes and kickbacks in chapter 11 of Publication 535. File free 2012 tax return Investment-related seminars. File free 2012 tax return Life insurance premiums paid by the insured. File free 2012 tax return Lobbying expenses. File free 2012 tax return Losses from the sale of your home, furniture, personal car, etc. File free 2012 tax return Lost or misplaced cash or property. File free 2012 tax return Lunches with co-workers. File free 2012 tax return Meals while working late. File free 2012 tax return Medical expenses as business expenses other than medical examinations required by your employer. File free 2012 tax return Personal disability insurance premiums. File free 2012 tax return Personal legal expenses. File free 2012 tax return Personal, living, or family expenses. File free 2012 tax return Political contributions. File free 2012 tax return Professional accreditation fees. File free 2012 tax return Professional reputation, expenses to improve. File free 2012 tax return Relief fund contributions. File free 2012 tax return Residential telephone line. File free 2012 tax return Stockholders' meeting, expenses of attending. File free 2012 tax return Tax-exempt income, expenses of earning or collecting. File free 2012 tax return The value of wages never received or lost vacation time. File free 2012 tax return Travel expenses for another individual. File free 2012 tax return Voluntary unemployment benefit fund contributions. File free 2012 tax return Wristwatches. File free 2012 tax return Adoption Expenses You cannot deduct the expenses of adopting a child but you may be able to take a credit for those expenses. File free 2012 tax return For details, see Form 8839, Qualified Adoption Expenses. File free 2012 tax return Commissions Commissions paid on the purchase of securities are not deductible, either as business or nonbusiness expenses. File free 2012 tax return Instead, these fees must be added to the taxpayer's cost of the securities. File free 2012 tax return Commissions paid on the sale are deductible as business expenses only by dealers. File free 2012 tax return Campaign Expenses You cannot deduct campaign expenses of a candidate for any office, even if the candidate is running for reelection to the office. File free 2012 tax return These include qualification and registration fees for primary elections. File free 2012 tax return Legal fees. File free 2012 tax return   You cannot deduct legal fees paid to defend charges that arise from participation in a political campaign. File free 2012 tax return Capital Expenses You cannot currently deduct amounts paid to buy property that has a useful life substantially beyond the tax year or amounts paid to increase the value or prolong the life of property. File free 2012 tax return If you use such property in your work, you may be able to take a depreciation deduction. File free 2012 tax return See Publication 946. File free 2012 tax return If the property is a car used in your work, also see Publication 463. File free 2012 tax return Check-Writing Fees on Personal Account If you have a personal checking account, you cannot deduct fees charged by the bank for the privilege of writing checks, even if the account pays interest. File free 2012 tax return Club Dues Generally, you cannot deduct the cost of membership in any club organized for business, pleasure, recreation, or other social purpose. File free 2012 tax return This includes business, social, athletic, luncheon, sporting, airline, hotel, golf, and country clubs. File free 2012 tax return You cannot deduct dues paid to an organization if one of its main purposes is to: Conduct entertainment activities for members or their guests, or Provide members or their guests with access to entertainment facilities. File free 2012 tax return Dues paid to airline, hotel, and luncheon clubs are not deductible. File free 2012 tax return Commuting Expenses You cannot deduct commuting expenses (the cost of transportation between your home and your main or regular place of work). File free 2012 tax return If you haul tools, instruments, or other items in your car to and from work, you can deduct only the additional cost of hauling the items, such as the rent on a trailer to carry the items. File free 2012 tax return Fines or Penalties You cannot deduct fines or penalties you pay to a governmental unit for violating a law. File free 2012 tax return This includes an amount paid in settlement of your actual or potential liability for a fine or penalty (civil or criminal). File free 2012 tax return Fines or penalties include parking tickets, tax penalties, and penalties deducted from teachers' paychecks after an illegal strike. File free 2012 tax return Health Spa Expenses You cannot deduct health spa expenses, even if there is a job requirement to stay in excellent physical condition, such as might be required of a law enforcement officer. File free 2012 tax return Home Security System You cannot deduct the cost of a home security system as a miscellaneous deduction. File free 2012 tax return However, you may be able to claim a deduction for a home security system as a business expense if you have a home office. File free 2012 tax return See Home Office under Unreimbursed Employee Expenses, earlier, and Publication 587. File free 2012 tax return Investment-Related Seminars You cannot deduct any expenses for attending a convention, seminar, or similar meeting for investment purposes. File free 2012 tax return Life Insurance Premiums You cannot deduct premiums you pay on your life insurance. File free 2012 tax return You may be able to deduct, as alimony, premiums you pay on life insurance policies assigned to your former spouse. File free 2012 tax return See Publication 504, Divorced or Separated Individuals, for information on alimony. File free 2012 tax return Lobbying Expenses You generally cannot deduct amounts paid or incurred for lobbying expenses. File free 2012 tax return These include expenses to: Influence legislation, Participate, or intervene, in any political campaign for, or against, any candidate for public office, Attempt to influence the general public, or segments of the public, about elections, legislative matters, or referendums, or Communicate directly with covered executive branch officials in any attempt to influence the official actions or positions of those officials. File free 2012 tax return Lobbying expenses also include any amounts paid or incurred for research, preparation, planning, or coordination of any of these activities. File free 2012 tax return Covered executive branch official. File free 2012 tax return   A covered executive branch official, for the purpose of (4) above, is any of the following officials. File free 2012 tax return The President. File free 2012 tax return The Vice President. File free 2012 tax return Any officer or employee of the White House Office of the Executive Office of the President, and the two most senior level officers of each of the other agencies in the Executive Office. File free 2012 tax return Any individual serving in a position in Level I of the Executive Schedule under section 5312 of Title 5, United States Code, any other individual designated by the President as having Cabinet-level status, and any immediate deputy of one of these individuals. File free 2012 tax return Dues used for lobbying. File free 2012 tax return   If a tax-exempt organization notifies you that part of the dues or other amounts you pay to the organization are used to pay nondeductible lobbying expenses, you cannot deduct that part. File free 2012 tax return Exceptions. File free 2012 tax return   You can deduct certain lobbying expenses if they are ordinary and necessary expenses of carrying on your trade or business. File free 2012 tax return You can deduct expenses for attempting to influence the legislation of any local council or similar governing body (local legislation). File free 2012 tax return An Indian tribal government is considered a local council or similar governing body. File free 2012 tax return You can deduct in-house expenses for influencing legislation or communicating directly with a covered executive branch official if the expenses for the tax year are not more than $2,000 (not counting overhead expenses). File free 2012 tax return If you are a professional lobbyist, you can deduct the expenses you incur in the trade or business of lobbying on behalf of another person. File free 2012 tax return Payments by the other person to you for lobbying activities cannot be deducted. File free 2012 tax return Lost or Mislaid Cash or Property You cannot deduct a loss based on the mere disappearance of money or property. File free 2012 tax return However, an accidental loss or disappearance of property can qualify as a casualty if it results from an identifiable event that is sudden, unexpected, or unusual. File free 2012 tax return See Publication 547. File free 2012 tax return Example. File free 2012 tax return A car door is accidentally slammed on your hand, breaking the setting of your diamond ring. File free 2012 tax return The diamond falls from the ring and is never found. File free 2012 tax return The loss of the diamond is a casualty. File free 2012 tax return Lunches With Co-workers You cannot deduct the expenses of lunches with co-workers, except while traveling away from home on business. File free 2012 tax return See Publication 463 for information on deductible expenses while traveling away from home. File free 2012 tax return Meals While Working Late You cannot deduct the cost of meals while working late. File free 2012 tax return However, you may be able to claim a deduction if the cost of the meals is a deductible entertainment expense, or if you are traveling away from home. File free 2012 tax return See Publication 463 for information on deductible entertainment expenses and expenses while traveling away from home. File free 2012 tax return Personal Legal Expenses You cannot deduct personal legal expenses such as those for the following. File free 2012 tax return Custody of children. File free 2012 tax return Breach of promise to marry suit. File free 2012 tax return Civil or criminal charges resulting from a personal relationship. File free 2012 tax return Damages for personal injury (except certain whistleblower claims and unlawful discrimination claims). File free 2012 tax return For more information about unlawful discrimination claims, see Deductions Subject to the 2% Limit, earlier. File free 2012 tax return Preparation of a title (or defense or perfection of a title). File free 2012 tax return Preparation of a will. File free 2012 tax return Property claims or property settlement in a divorce. File free 2012 tax return You cannot deduct these expenses even if a result of the legal proceeding is the loss of income-producing property. File free 2012 tax return Political Contributions You cannot deduct contributions made to a political candidate, a campaign committee, or a newsletter fund. File free 2012 tax return Advertisements in convention bulletins and admissions to dinners or programs that benefit a political party or political candidate are not deductible. File free 2012 tax return Professional Accreditation Fees You cannot deduct professional accreditation fees such as the following. File free 2012 tax return Accounting certificate fees paid for the initial right to practice accounting. File free 2012 tax return Bar exam fees and incidental expenses in securing initial admission to the bar. File free 2012 tax return Medical and dental license fees paid to get initial licensing. File free 2012 tax return Professional Reputation You cannot deduct expenses of radio and TV appearances to increase your personal prestige or establish your professional reputation. File free 2012 tax return Relief Fund Contributions You cannot deduct contributions paid to a private plan that pays benefits to any covered employee who cannot work because of any injury or illness not related to the job. File free 2012 tax return Residential Telephone Service You cannot deduct any charge (including taxes) for basic local telephone service for the first telephone line to your residence, even if it is used in a trade or business. File free 2012 tax return Stockholders' Meetings You cannot deduct transportation and other expenses you pay to attend stockholders' meetings of companies in which you own stock but have no other interest. File free 2012 tax return You cannot deduct these expenses even if you are attending the meeting to get information that would be useful in making further investments. File free 2012 tax return Tax-Exempt Income Expenses You cannot deduct expenses to produce tax-exempt income. File free 2012 tax return You cannot deduct interest on a debt incurred or continued to buy or carry tax-exempt securities. File free 2012 tax return If you have expenses to p