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File my 2011 taxes free Publication 4492-A - Main Contents Table of Contents DefinitionsKansas Disaster Area Storms and Tornadoes Casualty and Theft Losses Replacement Period for Nonrecognition of Gain Net Operating Losses IRAs and Other Retirement PlansDefinitions Taxation of Qualified Recovery Assistance Distributions Repayment of Qualified Recovery Assistance Distributions How To Report Qualified Recovery Assistance Distributions Repayment of Qualified Distributions for the Purchase or Construction of a Main Home Loans From Qualified Plans Additional Tax Relief for BusinessesSpecial Depreciation Allowance Increased Section 179 Deduction Employee Retention Credit Demolition and Clean-up Costs Request for Copy or Transcript of Tax Return How To Get Tax HelpLow Income Taxpayer Clinics (LITCs). File my 2011 taxes free Definitions The following definitions are used throughout this publication. File my 2011 taxes free Kansas Disaster Area The Kansas disaster area covers the Kansas counties of Barton, Clay, Cloud, Comanche, Dickinson, Edwards, Ellsworth, Kiowa, Leavenworth, Lyon, McPherson, Osage, Osborne, Ottawa, Phillips, Pottawatomie, Pratt, Reno, Rice, Riley, Saline, Shawnee, Smith, and Stafford. File my 2011 taxes free Storms and Tornadoes The term “storms and tornadoes” as used in this publication, refers to the storms and tornadoes that began on May 4, 2007, and affected the Kansas disaster area (defined above). File my 2011 taxes free Casualty and Theft Losses The following paragraphs explain changes to casualty and theft losses that occurred in the Kansas disaster area. File my 2011 taxes free Limits on personal casualty or theft losses in the Kansas disaster area. File my 2011 taxes free   Losses of personal use property that arose in the Kansas disaster area after May 3, 2007, are not subject to the $100 or 10% of adjusted gross income limits. File my 2011 taxes free Qualifying losses include losses from casualties and thefts that arose in the disaster area and that were attributable to the storms and tornadoes. File my 2011 taxes free When to deduct the loss. File my 2011 taxes free   Casualty and theft losses are generally deductible only in the year the casualty occurred or the theft was discovered. File my 2011 taxes free However, the Kansas disaster area is a Presidentially declared disaster. File my 2011 taxes free Therefore, you could have elected to deduct losses from these storms and tornadoes on your tax return for the previous year. File my 2011 taxes free The deadline for making this election has expired. File my 2011 taxes free   The following special instructions explain how to complete your forms if you deduct the loss in 2007 or elected to deduct the loss in 2006. File my 2011 taxes free Special instructions for individuals who file Form 4684 to claim a Kansas disaster area casualty or theft loss for 2007 or are amending their 2006 return. File my 2011 taxes free   Individuals filing or amending their 2007 tax return or amending their 2006 tax return for casualty or theft losses that were attributable to the storms and tornadoes should enter “Kansas Disaster Area” at the top of Form 1040 or 1040X. File my 2011 taxes free They must also complete and attach the 2006 version of Form 4684 for either year and enter “Kansas Disaster Area” on the top and on the dotted line next to line 11 and enter -0- on line 11. File my 2011 taxes free Individuals filing or amending their 2007 tax return should cross out “2006” and enter “2007” at the top of Form 4684. File my 2011 taxes free They must also enter the amount from line 21 of that form on line 20 of Schedule A (Form 1040). File my 2011 taxes free Replacement Period for Nonrecognition of Gain Generally, an involuntary conversion occurs when property is damaged, destroyed, stolen, seized, requisitioned, or condemned, and you receive other property or money in payment, such as insurance or a condemnation award. File my 2011 taxes free Generally, you do not have to report a gain (if any) if you replace the property within 2 years (4 years for a main home in a Presidentially declared disaster area). File my 2011 taxes free However, for property that was involuntarily converted after May 3, 2007, as a result of the storms and tornadoes, a 5-year replacement period applies if substantially all of the use of the replacement property is in the Kansas disaster area. File my 2011 taxes free For more information, see the Instructions for Form 4684. File my 2011 taxes free Net Operating Losses Qualified recovery assistance loss. File my 2011 taxes free   Generally, you can carry a net operating loss (NOL) back to the 2 tax years before the NOL year. File my 2011 taxes free However, the portion of an NOL that is a qualified recovery assistance loss can be carried back to the 5 tax years before the NOL year. File my 2011 taxes free In addition, the 90% limit on the alternative tax NOL deduction (ATNOLD) does not apply to such portion of the ATNOLD. File my 2011 taxes free   A qualified recovery assistance loss is the smaller of: The excess of the NOL for the year over the specified liability loss for the year to which a 10-year carryback applies, or The total of the following deductions (to the extent they are taken into account in computing the NOL for the tax year): Qualified recovery assistance casualty loss (as defined below), Moving expenses paid or incurred after May 3, 2007, and before January 1, 2010, for the employment of an individual whose main home was in the Kansas disaster area before May 4, 2007, who was unable to remain in that home because of the storms and tornadoes, and whose main job location (after the move) is in the Kansas disaster area, Temporary housing expenses paid or incurred after May 3, 2007, and before January 1, 2010, to house employees of the taxpayer whose main job location is in the Kansas disaster area, Depreciation or amortization allowable for any qualified recovery assistance property (even if you elected not to claim the special recovery assistance depreciation allowance for such property) for the year placed in service, and Repair expenses (including expenses for the removal of debris) paid or incurred after May 3, 2007, and before January 1, 2010, for any damage from the storms and tornadoes to property located in the Kansas disaster area. File my 2011 taxes free Qualified recovery assistance casualty loss. File my 2011 taxes free   A qualified recovery assistance casualty loss is any deductible section 1231 loss of property located in the Kansas disaster area if the loss was caused by the storms and tornadoes. File my 2011 taxes free For this purpose, the amount of the loss is reduced by any recognized gain from an involuntary conversion caused by the storms and tornadoes of property located in the Kansas disaster area. File my 2011 taxes free Any such loss taken into account in figuring your qualified recovery assistance loss is not eligible for the election to be treated as having occurred in the previous tax year. File my 2011 taxes free Amended return. File my 2011 taxes free   If you have already filed your 2007 tax return and then carried your NOL back 2 years, you may file an amended return to carry back for 5 years your NOL attributable to a qualified recovery assistance loss. File my 2011 taxes free More information. File my 2011 taxes free    For more information on NOLs, see Publication 536. File my 2011 taxes free IRAs and Other Retirement Plans New rules provide for tax-favored withdrawals, repayments, and loans from certain retirement plans for individuals who suffered economic losses as a result of the storms and tornadoes. File my 2011 taxes free Definitions Qualified recovery assistance distribution. File my 2011 taxes free   Except as provided below, a qualified recovery assistance distribution is any distribution you received and designated as such from an eligible retirement plan if all of the following apply. File my 2011 taxes free The distribution was made after May 3, 2007, and before January 1, 2009. File my 2011 taxes free Your main home was located in the Kansas disaster area on May 4, 2007. File my 2011 taxes free You sustained an economic loss because of the storms and tornadoes. File my 2011 taxes free Examples of an economic loss include, but are not limited to: Loss, damage to, or destruction of real or personal property from fire, flooding, looting, vandalism, theft, wind, or other cause; Loss related to displacement from your home; or Loss of livelihood due to temporary or permanent layoffs. File my 2011 taxes free   If (1) through (3) above apply, you can generally designate any distribution (including periodic payments and required minimum distributions) from an eligible retirement plan as a qualified recovery assistance distribution, regardless of whether the distribution was made on account of the storms and tornadoes. File my 2011 taxes free Qualified recovery assistance distributions are permitted without regard to your need or the actual amount of your economic loss. File my 2011 taxes free   The total of your qualified recovery assistance distributions from all plans is limited to $100,000. File my 2011 taxes free If you have distributions in excess of $100,000 from more than one type of plan, such as a 401(k) plan and an IRA, you may allocate the $100,000 limit among the plans any way you choose. File my 2011 taxes free   A reduction or offset after May 3, 2007, of your account balance in an eligible retirement plan in order to repay a loan can also be designated as a qualified recovery assistance distribution. File my 2011 taxes free Eligible retirement plan. File my 2011 taxes free   An eligible retirement plan can be any of the following. File my 2011 taxes free A qualified pension, profit-sharing, or stock bonus plan (including a 401(k) plan). File my 2011 taxes free A qualified annuity plan. File my 2011 taxes free A tax-sheltered annuity contract. File my 2011 taxes free A governmental section 457 deferred compensation plan. File my 2011 taxes free A traditional, SEP, SIMPLE, or Roth IRA. File my 2011 taxes free Main home. File my 2011 taxes free   Generally, your main home is the home where you live most of the time. File my 2011 taxes free A temporary absence due to special circumstances, such as illness, education, business, military service, evacuation, or vacation, will not change your main home. File my 2011 taxes free Taxation of Qualified Recovery Assistance Distributions Qualified recovery assistance distributions are included in income in equal amounts over three years. File my 2011 taxes free However, if you elect, you can include the entire distribution in your income in the year it was received. File my 2011 taxes free Qualified recovery assistance distributions are not subject to the additional 10% tax (or the additional 25% tax for certain distributions from SIMPLE IRAs) on early distributions from qualified retirement plans (including IRAs). File my 2011 taxes free However, any distributions you receive in excess of the $100,000 qualified recovery assistance distribution limit may be subject to the additional tax on early distributions. File my 2011 taxes free For more information, see How To Report Qualified Recovery Assistance Distributions on page 4. File my 2011 taxes free Repayment of Qualified Recovery Assistance Distributions If you choose, you generally can repay any portion of a qualified recovery assistance distribution that is eligible for tax-free rollover treatment to an eligible retirement plan. File my 2011 taxes free Also, you can repay a qualified recovery assistance distribution made on account of a hardship from a retirement plan. File my 2011 taxes free However, see Exceptions below for qualified recovery assistance distributions you cannot repay. File my 2011 taxes free You have three years from the day after the date you received the distribution to make a repayment. File my 2011 taxes free Amounts that are repaid are treated as a qualified rollover and are not included in income. File my 2011 taxes free Also, for purposes of the one-rollover-per-year limitation for IRAs, a repayment to an IRA is not considered a qualified rollover. File my 2011 taxes free See Form 8915 for more information on how to report repayments. File my 2011 taxes free Exceptions. File my 2011 taxes free   You cannot repay the following types of distributions. File my 2011 taxes free Qualified recovery assistance distributions received as a beneficiary (other than a surviving spouse). File my 2011 taxes free Required minimum distributions. File my 2011 taxes free Periodic payments (other than from an IRA) that are for: A period of 10 years or more, Your life or life expectancy, or The joint lives or joint life expectancies of you and your beneficiary. File my 2011 taxes free How To Report Qualified Recovery Assistance Distributions You will need the following information to correctly report any 2007 or 2008 qualified recovery assistance distributions. File my 2011 taxes free 2007 Qualified Recovery Assistance Distributions If you received a distribution after May 3, 2007, from an eligible retirement plan, you may be able to designate it as a qualified recovery assistance distribution. File my 2011 taxes free See Qualified recovery assistance distribution on page 3. File my 2011 taxes free If you have not filed your 2007 income tax return, see Form 8915 and Form 8606 on this page to see how to complete these forms for any qualified recovery assistance distributions. File my 2011 taxes free Be sure to attach Form 8915 and Form 8606 (if required) to your 2007 income tax return. File my 2011 taxes free If you have filed your 2007 income tax return, you will need to amend your return to designate any distributions as qualified recovery assistance distributions. File my 2011 taxes free You can amend your 2007 income tax return by using Form 1040X. File my 2011 taxes free You will need to complete and attach Form 8915 and Form 8606 (if required) to your amended income tax return for any qualified recovery assistance distributions. File my 2011 taxes free See Form 8915 and Form 8606 on this page. File my 2011 taxes free Form 8915. File my 2011 taxes free   For a 2007 qualified recovery assistance distribution, complete the 2005 Form 8915, Qualified Hurricane Retirement Plan Distributions and Repayments. File my 2011 taxes free Before you complete the form, modify the form as follows. File my 2011 taxes free Cross out “Hurricane” in the title at the top of the form and enter “Recovery Assistance. File my 2011 taxes free ” To the right of the title, cross out “2005” and enter “2007. File my 2011 taxes free ” In Part I, at the top of column (a), cross out “2005” and enter “2007. File my 2011 taxes free ” In Part II, cross out “Hurricane” in the title and enter “Recovery Assistance. File my 2011 taxes free ” On lines 10 and 11, cross out “2005” and enter “2007. File my 2011 taxes free ” In Part III, cross out “Hurricane” in the title and enter “Recovery Assistance. File my 2011 taxes free ” On line 12, cross out “hurricane” and enter “recovery assistance. File my 2011 taxes free ” On lines 13 and 14, cross out “line 15b” and “line 25b. File my 2011 taxes free ” On lines 18 and 19, cross out “2005” and enter “2007. File my 2011 taxes free ”   You can now complete Form 8915. File my 2011 taxes free For the instructions, use the applicable dates and terms in this publication instead of those used in the 2005 Form 8915 instructions. File my 2011 taxes free See Example 1 on page 5 to see how to complete Form 8915. File my 2011 taxes free Form 8606. File my 2011 taxes free   For a 2007 qualified recovery assistance distribution, complete or amend the 2007 Form 8606, Nondeductible IRAs. File my 2011 taxes free Before you complete or amend the form, use the following additional instructions. File my 2011 taxes free Form 8606, Part I. File my 2011 taxes free    On line 6, subtract any repayments of qualified recovery assistance distributions from the amount you would otherwise enter on line 6. File my 2011 taxes free Do not enter an amount less than -0-. File my 2011 taxes free Include on line 7 the amount of any qualified recovery assistance distributions that you received even if they were later repaid. File my 2011 taxes free Complete line 15 as follows. File my 2011 taxes free If all of your distributions are qualified recovery assistance distributions, enter the amount from line 15 on Form 8915, line 13. File my 2011 taxes free Do not enter this amount on Form 1040, line 15b; Form 1040A, line 11b; or Form 1040NR, line 16b. File my 2011 taxes free If you have qualified recovery assistance distributions as well as other distributions, you will need to multiply the amount on line 15 by a fraction. File my 2011 taxes free The numerator of the fraction is your total qualified recovery assistance distributions and the denominator is the amount from Form 8606, line 7. File my 2011 taxes free Enter the result in the white space in the bottom margin of the form under line 15. File my 2011 taxes free To the left of this amount, enter “Qualified recovery assistance distributions” and also enter this amount on Form 8915, line 13. File my 2011 taxes free Then, subtract this amount from the amount on line 15 and include the result on Form 1040, line 15b; Form 1040A, line 11b; or Form 1040NR, line 16b. File my 2011 taxes free Also, enter this amount on Form 8606 under your qualified recovery assistance distributions. File my 2011 taxes free To the left of this amount, enter “Other distributions. File my 2011 taxes free ” Form 8606, Part III. File my 2011 taxes free    Include on line 19 the amount of any qualified recovery assistance distributions that you received even if they were later repaid. File my 2011 taxes free Complete line 25 as follows. File my 2011 taxes free If all of your distributions are qualified recovery assistance distributions, enter the amount from line 25 on Form 8915, line 14. File my 2011 taxes free Do not enter this amount on Form 1040, line 15b; Form 1040A, line 11b; or Form 1040NR, line 16b. File my 2011 taxes free If you have qualified recovery assistance distributions as well as other distributions, you will need to multiply the amount on line 25 by a fraction. File my 2011 taxes free The numerator of the fraction is your total qualified recovery assistance distributions and the denominator is the amount from Form 8606, line 21. File my 2011 taxes free Enter the result in the white space in the bottom margin of the form under line 25. File my 2011 taxes free To the left of this amount, enter “Qualified recovery assistance distributions” and also enter this amount on Form 8915, line 14. File my 2011 taxes free Then, subtract this amount from the amount on line 25 and include the result on Form 1040, line 15b; Form 1040A, line 11b; or Form 1040NR, line 16b. File my 2011 taxes free Also, enter this amount on Form 8606 under your qualified recovery assistance distributions. File my 2011 taxes free To the left of this amount, enter “Other distributions. File my 2011 taxes free ” Example 1. File my 2011 taxes free   On May 4, 2007, Margaret Maple lost her home due to the tornadoes on that day. File my 2011 taxes free Her home was located in the Kansas disaster area. File my 2011 taxes free On July 31, 2007, Margaret took out $30,000 from her 401(k) plan and an additional $15,000 from her traditional IRA in order to rebuild her home. File my 2011 taxes free Margaret has not filed her 2007 return yet but would like to designate the $45,000 in distributions from her retirement plans as qualified recovery assistance distributions. File my 2011 taxes free Since the distributions occurred in 2007, Margaret would modify and complete the 2005 Form 8915 as discussed on page 4. File my 2011 taxes free Margaret would also need to complete Form 8606 since her distribution from her traditional IRA has nondeductible contributions from previous years. File my 2011 taxes free   In addition to the $15,000 qualified recovery assistance distribution on July 31, 2007, Margaret received an additional distribution of $15,000 from her traditional IRA on October 31, 2007, that she did not designate as a qualified recovery assistance distribution. File my 2011 taxes free Because Margaret has a qualified recovery assistance distribution as well as a distribution not so designated, Margaret must allocate the amount on Form 8606, line 15 to both distributions, as discussed earlier. File my 2011 taxes free Margaret's qualified recovery assistance distributions are $13,125 ($26,250 × $15,000 ÷ $30,000). File my 2011 taxes free Margaret enters in the white space in the bottom margin of Form 8606, the following, “Qualified recovery assistance distributions $13,125. File my 2011 taxes free ” This amount is then reported on Form 8915, line 13. File my 2011 taxes free Below this entry, Margaret enters “Other distributions $13,125,” and includes this amount on Form 1040, line 15b. File my 2011 taxes free See Margaret's modified 2005 Form 8915 and 2007 Form 8606 shown on pages 6 through 8. File my 2011 taxes free This image is too large to be displayed in the current screen. File my 2011 taxes free Please click the link to view the image. File my 2011 taxes free 2005 Form 8915, page 1, Illustrated Example 1. File my 2011 taxes free This image is too large to be displayed in the current screen. File my 2011 taxes free Please click the link to view the image. File my 2011 taxes free 2005 Form 8915, page 2, Illustrated Example 1 This image is too large to be displayed in the current screen. File my 2011 taxes free Please click the link to view the image. File my 2011 taxes free Form 8606, page 1, Illustrated Example 1 2008 Qualified Recovery Assistance Distributions If you received a distribution in 2008 from an eligible retirement plan, you may be able to designate it as a qualified recovery assistance distribution. File my 2011 taxes free See Qualified recovery assistance distribution on page 3. File my 2011 taxes free You will need to complete and attach Form 8915 and Form 8606 (if required) to your 2008 income tax return for any qualified recovery assistance distributions. File my 2011 taxes free See Form 8915 and Form 8606 below. File my 2011 taxes free Form 8915. File my 2011 taxes free   For a 2008 qualified recovery assistance distribution, you will need to complete the 2006 Form 8915. File my 2011 taxes free Before you complete the form, modify the form as follows. File my 2011 taxes free Cross out “Hurricane” in the title at the top of the form and enter “Recovery Assistance. File my 2011 taxes free ” To the right of the title, cross out “2006” and enter “2008. File my 2011 taxes free ” In the first sentence of Part I and on line 1, cross out “hurricane” and enter “recovery assistance,” cross out “2006” and enter “2008,” and cross out “2005” and enter “2007. File my 2011 taxes free ” At the top of column (a) cross out “2006” and enter “2008. File my 2011 taxes free ” In Part II, cross out “Hurricane” in the title and enter “Recovery Assistance. File my 2011 taxes free ” On lines 12, 14, and 15, cross out “2005” and enter “2007. File my 2011 taxes free ” On lines 17 and 19, cross out “2006” and enter “2008. File my 2011 taxes free ” In Part III, cross out “Hurricane” in the title and enter “Recovery Assistance. File my 2011 taxes free ” On line 21, cross out “hurricane” and enter “recovery assistance. File my 2011 taxes free ” On lines 22 and 23, cross out “line 15b” and “line 25b. File my 2011 taxes free ” On lines 27, 29, and 30, cross out “2005” and enter “2007. File my 2011 taxes free ” On lines 32 and 34, cross out “2006” and enter “2008. File my 2011 taxes free ”   You can now complete Form 8915. File my 2011 taxes free For the instructions, use the applicable dates and terms in this publication instead of those used in the 2006 Form 8915 instructions. File my 2011 taxes free Example 2. File my 2011 taxes free   On June 15, 2008, Margaret Maple, from the previous example, took out $15,000 from her 401(k) plan that she is designating as a qualified recovery assistance distribution. File my 2011 taxes free Since the distribution occurred in 2008, Margaret would modify and complete the 2006 Form 8915 as discussed above. File my 2011 taxes free Also, since Margaret is including her 2007 recovery assistance distributions in income over 3 years, she reports the applicable amount of those distributions on the modified 2006 Form 8915. File my 2011 taxes free See Margaret's modified 2006 Form 8915 shown on pages 9 and 10. File my 2011 taxes free This image is too large to be displayed in the current screen. File my 2011 taxes free Please click the link to view the image. File my 2011 taxes free 2006 Form 8915, page 1, Illustrated Example 2 This image is too large to be displayed in the current screen. File my 2011 taxes free Please click the link to view the image. File my 2011 taxes free 2006 Form 8915, page 2, Illustrated Example 2 Form 8606. File my 2011 taxes free   For a 2008 qualified recovery assistance distribution, you may need to complete the 2008 Form 8606. File my 2011 taxes free Before you complete Form 8606, use the additional instructions outlined in Form 8606, Part I, on page 4 and Form 8606, Part III, on this page. File my 2011 taxes free Repayment of Qualified Distributions for the Purchase or Construction of a Main Home If you received a qualified distribution to purchase or construct a main home in the Kansas disaster area, you can repay part or all of that distribution after May 3, 2007, but no later than October 22, 2008, to an eligible retirement plan. File my 2011 taxes free For this purpose, an eligible retirement plan is any plan, annuity, or IRA to which a qualified rollover can be made. File my 2011 taxes free To be a qualified distribution, the distribution must meet all of the following requirements. File my 2011 taxes free The distribution is a hardship distribution from a 401(k) plan, a hardship distribution from a tax-sheltered annuity contract, or a qualified first-time homebuyer distribution from an IRA. File my 2011 taxes free The distribution was received after November 4, 2006, and before May 5, 2007. File my 2011 taxes free The distribution was to be used to purchase or construct a main home in the Kansas disaster area that was not purchased or constructed because of the storms and tornadoes. File my 2011 taxes free Amounts that are repaid before October 23, 2008, are treated as a qualified rollover and are not included in income. File my 2011 taxes free Also, for purposes of the one-rollover-per-year limitation for IRAs, a repayment to an IRA is not considered a qualified rollover. File my 2011 taxes free A qualified distribution not repaid before October 23, 2008, may be taxable for 2006 or 2007 and subject to the additional 10% tax (or the additional 25% tax for certain SIMPLE IRAs) on early distributions. File my 2011 taxes free You must file Form 8915 if you received a qualified distribution that you repaid, in whole or in part, before October 23, 2008. File my 2011 taxes free See How to report, next, for information on completing Form 8915. File my 2011 taxes free How to report. File my 2011 taxes free   To report the repayment of a qualified distribution for the purchase or construction of a main home that was not purchased or constructed due to the storms and tornadoes, use the 2005 Form 8915, Part IV. File my 2011 taxes free Before you complete the form, modify the form as follows. File my 2011 taxes free Cross out “Hurricane” in the title at the top of the form and enter “Recovery Assistance. File my 2011 taxes free ” To the right of the title, cross out “2005” and enter “2006” or “2007. File my 2011 taxes free ” Enter only the year the distribution was received. File my 2011 taxes free Cross out “Hurricane” in the title of Part IV and enter “Kansas. File my 2011 taxes free ” In the sentence below the title of Part IV, cross out “March 1, 2006” and enter “October 23, 2008. File my 2011 taxes free ” On line 24, cross out “March 1, 2006” and enter “October 23, 2008. File my 2011 taxes free ” You can now complete Part IV of Form 8915. File my 2011 taxes free Use the applicable dates and terms in this publication instead of those used in the 2005 Form 8915 instructions to complete the form. File my 2011 taxes free Attach Form 8915 to your original or amended return for the year of the distribution. File my 2011 taxes free Amended return. File my 2011 taxes free   If you repay part or all of a qualified distribution by October 22, 2008, you will need to file an amended return for that part of a distribution that was previously included in income. File my 2011 taxes free Loans From Qualified Plans The following benefits are available to qualified individuals. File my 2011 taxes free Increases to the limits for distributions treated as loans from employer plans. File my 2011 taxes free A 1-year suspension for payments due on plan loans. File my 2011 taxes free Qualified individual. File my 2011 taxes free   You are a qualified individual if your main home on May 4, 2007, was located in the Kansas disaster area and you had an economic loss because of the storms and tornadoes. File my 2011 taxes free Examples of an economic loss include, but are not limited to: Loss, damage to, or destruction of real or personal property from fire, flooding, looting, vandalism, theft, wind, or other cause; Loss related to displacement from your home; or Loss of livelihood due to temporary or permanent layoffs. File my 2011 taxes free Limits on plan loans. File my 2011 taxes free   The $50,000 limit for distributions treated as plan loans is increased to $100,000. File my 2011 taxes free In addition, the limit based on 50% of your vested accrued benefit is increased to 100% of that benefit. File my 2011 taxes free If your home was located in the Kansas disaster area, the higher limits apply only to loans received during the period beginning on May 22, 2008, and ending on December 31, 2008. File my 2011 taxes free One-year suspension of loan payments. File my 2011 taxes free   Payments on plan loans outstanding after May 3, 2007, may be suspended for 1 year by the plan administrator. File my 2011 taxes free To qualify for the suspension, the due date for any loan payment must occur during the period beginning on May 4, 2007, and ending on December 31, 2008. File my 2011 taxes free Additional Tax Relief for Businesses Special Depreciation Allowance You can take a special depreciation allowance for qualified recovery assistance property (as defined below) you acquire after May 4, 2007. File my 2011 taxes free The special allowance is an additional deduction of 50% of the property's depreciable basis (after any section 179 deduction and before figuring your regular depreciation deduction). File my 2011 taxes free The special allowance applies only for the first year the property is placed in service. File my 2011 taxes free The special allowance is deductible for both the regular tax and the alternative minimum tax (AMT). File my 2011 taxes free There is no AMT adjustment required for any depreciation figured on the remaining basis of the property. File my 2011 taxes free You can elect not to deduct the special allowance for qualified recovery assistance property. File my 2011 taxes free If you make this election for any property, it applies to all property in the same class placed in service during the year. File my 2011 taxes free Qualified recovery assistance property. File my 2011 taxes free   Property that qualifies for the special allowance for qualified recovery assistance property includes the following. File my 2011 taxes free Tangible property depreciated under the modified accelerated cost recovery system (MACRS) with a recovery period of 20 years or less. File my 2011 taxes free Water utility property. File my 2011 taxes free Computer software that is readily available for purchase by the general public, is subject to a nonexclusive license, and has not been substantially modified. File my 2011 taxes free (The cost of some computer software is treated as part of the cost of hardware and is depreciated under MACRS. File my 2011 taxes free ) Qualified leasehold improvement property. File my 2011 taxes free Nonresidential real property and residential rental property. File my 2011 taxes free   For more information on this property, see Publication 946. File my 2011 taxes free Other tests to be met. File my 2011 taxes free   To be qualified recovery assistance property, the property must also meet all of the following tests. File my 2011 taxes free You must have acquired the property, by purchase, after May 4, 2007, but only if no binding written contract for the acquisition was in effect before May 5, 2007. File my 2011 taxes free The property must be placed in service before 2009 (2010 in the case of nonresidential real property and residential rental property). File my 2011 taxes free Substantially all of the use of the property must be in the Kansas disaster area and in the active conduct of your trade or business in the Kansas disaster area. File my 2011 taxes free The original use of the property in the Kansas disaster area must begin with you after May 4, 2007. File my 2011 taxes free Used property can be qualified recovery assistance property if it has not previously been used within the Kansas disaster area. File my 2011 taxes free Also, additional capital expenditures you incurred after May 4, 2007, to recondition or rebuild your property meet the original use test if the original use of the property in the Kansas disaster area began with you. File my 2011 taxes free Excepted property. File my 2011 taxes free   Qualified recovery assistance property does not include any of the following. File my 2011 taxes free Property required to be depreciated using the Alternative Depreciation System (ADS). File my 2011 taxes free Property any portion of which is financed with the proceeds of a tax-exempt obligation under section 103. File my 2011 taxes free Property for which you are claiming a commercial revitalization deduction. File my 2011 taxes free Property in the same class as that for which you elected not to claim the special allowance for qualified recovery assistance property. File my 2011 taxes free Property placed in service and disposed of in the same tax year. File my 2011 taxes free Property converted from business use to personal use in the same tax year it is placed in service. File my 2011 taxes free Property converted from personal use to business use in the same or later tax year may be qualified recovery assistance property. File my 2011 taxes free Recapture of special allowance. File my 2011 taxes free   If, in any year after the year you claim the special allowance, the property ceases to be qualified recovery assistance property, you may have to recapture as ordinary income any excess benefit you received from claiming the special allowance. File my 2011 taxes free Amended return. File my 2011 taxes free   If you have already filed your tax return, you may have to amend that return to claim any special allowance. File my 2011 taxes free Additional guidance will be published on how you may claim, or elect not to claim, the special allowance if you have already filed your tax return. File my 2011 taxes free Increased Section 179 Deduction An increased section 179 deduction is allowable for qualified section 179 recovery assistance property (as defined later) placed in service in the Kansas disaster area. File my 2011 taxes free Increased dollar limit. File my 2011 taxes free   The limit on the section 179 deduction ($125,000 for 2007, $250,000 for 2008) is increased by the smaller of: $100,000, or The cost of qualified section 179 recovery assistance property placed in service during the year (including such property placed in service by your spouse, even if you are filing a separate return). File my 2011 taxes free   The amount for which you can make the election is reduced if the cost of all section 179 property you placed in service during the year exceeds $500,000 for 2007 and $800,000 for 2008 increased by the smaller of: $600,000, or The cost of qualified section 179 recovery assistance property placed in service during the year. File my 2011 taxes free Qualified section 179 recovery assistance property. File my 2011 taxes free   Qualified section 179 recovery assistance property is section 179 property that is qualified recovery assistance property (explained earlier under Special Depreciation Allowance). File my 2011 taxes free Section 179 property does not include nonresidential real property or residential rental property. File my 2011 taxes free For more information, including the requirements that must be met for property to qualify for the section 179 deduction, see chapter 2 of Publication 946. File my 2011 taxes free Amended return. File my 2011 taxes free   If you have already filed your tax return, you may have to amend that return for any increased section 179 deduction. File my 2011 taxes free Employee Retention Credit An eligible employer who conducted an active trade or business in the Kansas disaster area can claim the employee retention credit. File my 2011 taxes free The credit is 40% of qualified wages for each eligible employee (up to a maximum of $6,000 in qualified wages per employee). File my 2011 taxes free Generally, you must reduce your deduction for salaries and wages by the amount of this credit (before the tax liability limit). File my 2011 taxes free Use Form 5884-A to claim the credit. File my 2011 taxes free See Form 5884-A later. File my 2011 taxes free The following rules and definitions apply. File my 2011 taxes free Employers affected by the storms and tornadoes. File my 2011 taxes free   The following definitions apply to employers affected by the storms and tornadoes. File my 2011 taxes free Eligible employer. File my 2011 taxes free   For this purpose, an eligible employer is any employer who meets all of the following. File my 2011 taxes free Employed an average of not more than 200 employees on business days during the tax year before May 4, 2007. File my 2011 taxes free Conducted an active trade or business on May 4, 2007, in the Kansas disaster area. File my 2011 taxes free Whose trade or business was inoperable on any day after May 4, 2007, and before January 1, 2008, because of damage caused by the storms and tornadoes. File my 2011 taxes free Eligible employee. File my 2011 taxes free   For this purpose, an eligible employee is an employee whose principal place of employment on May 4, 2007, with the eligible employer was in the Kansas disaster area. File my 2011 taxes free An employee is not an eligible employee for purposes of the storms and tornadoes if the employee is treated as an eligible employee for the work opportunity credit. File my 2011 taxes free Qualified wages. File my 2011 taxes free   Qualified wages are wages you paid or incurred before January 1, 2008, (up to $6,000 per employee) for an eligible employee beginning on the date your trade or business first became inoperable at the employee's principal place of employment immediately before May 4, 2007, and ending on the date your trade or business resumed significant operations at that place. File my 2011 taxes free In addition, the wages must have been paid or incurred after May 4, 2007. File my 2011 taxes free    This includes wages paid even if the employee performed no services, performed services at a place of employment other than the principal place of employment, or performed services at the principal place of employment before significant operations resumed. File my 2011 taxes free    Wages qualifying for the credit generally have the same meaning as wages subject to the Federal Unemployment Tax Act (FUTA). File my 2011 taxes free Qualified wages also include amounts you paid for medical or hospitalization expenses in connection with sickness or accident disability. File my 2011 taxes free Qualified wages for any employee must be reduced by the amount of any work supplementation payment you received under the Social Security Act. File my 2011 taxes free   For agricultural employees, if the work performed by any employee during more than half of any pay period qualified under FUTA as agricultural labor, that employee's wages subject to social security and Medicare taxes are qualified wages. File my 2011 taxes free For a special rule that applies to railroad employees, see section 51(h)(1)(B). File my 2011 taxes free   Qualified wages do not include the following. File my 2011 taxes free Wages paid to your dependent or a related individual. File my 2011 taxes free See section 51(i)(1). File my 2011 taxes free Wages paid to any employee during the period for which you received payment for the employee from a federally funded on-the-job training program. File my 2011 taxes free Wages for services of replacement workers during a strike or lockout. File my 2011 taxes free Form 5884-A. File my 2011 taxes free   Use Section A of Form 5884-A (Rev. File my 2011 taxes free October 2006) to claim the employer retention credit. File my 2011 taxes free Section B does not apply to the Kansas disaster area. File my 2011 taxes free Before you complete the form, modify the form as follows. File my 2011 taxes free Cross out “Hurricane Katrina, Rita, or Wilma” in the title at the top of the form and enter “Kansas Storms and Tornadoes. File my 2011 taxes free ” On line 1a cross out “Hurricane Katrina” and enter “Kansas Storms and Tornadoes,” cross out “August 28, 2005,” and enter “May 4, 2007,” and cross out “January 1, 2006,” and enter “January 1, 2008. File my 2011 taxes free ”   Complete the form as instructed. File my 2011 taxes free Lines 1b and 1c do not apply. File my 2011 taxes free Include the amount from Form 5884-A, line 4 in the amount entered on Form 3800, line 1x. File my 2011 taxes free On the dotted line to the left of line 1x, enter “5884-A. File my 2011 taxes free ” Use the applicable dates and terms in this publication instead of those used in the Form 5884-A instructions. File my 2011 taxes free Amended return. File my 2011 taxes free   You may have to amend a previously filed return to claim the employee retention credit. File my 2011 taxes free Demolition and Clean-up Costs You can elect to deduct 50% of any qualified recovery assistance clean-up costs for the tax year in which the costs are paid or incurred, instead of capitalizing them. File my 2011 taxes free Qualified recovery assistance clean-up costs are any amounts paid or incurred after May 3, 2007, and before January 1, 2010, for the removal of debris from, or the demolition of structures on, real property located in the Kansas disaster area that is: Held by you for use in a trade or business or for the production of income, or Inventory or other property held primarily for sale to customers in the ordinary course of your trade or business. File my 2011 taxes free Amended return. File my 2011 taxes free   If you have already filed your tax return, you may have to amend that return to claim the 50% of any qualified recovery assistance clean-up costs. File my 2011 taxes free Request for Copy or Transcript of Tax Return Request for copy of tax return. File my 2011 taxes free   You can use Form 4506 to order a copy of your tax return. File my 2011 taxes free Generally, there is a $39. File my 2011 taxes free 00 fee (subject to change) for requesting each copy of a tax return. File my 2011 taxes free If your main home, principal place of business, or tax records are located in a Presidentially declared disaster area, the fee will be waived if the assigned disaster designation (for example, “Kansas Storms”) is written in red across the top of the form when filed. File my 2011 taxes free Request for transcript of tax return. File my 2011 taxes free   You can use Form 4506-T to order a free transcript of your tax return. File my 2011 taxes free A transcript provides most of the line entries from a tax return and usually contains the information that a third party requires. File my 2011 taxes free You can also call 1-800-829-1040 to order a transcript. File my 2011 taxes free How To Get Tax Help You can get help with unresolved tax issues, order free publications and forms, ask tax questions, and get information from the IRS in several ways. File my 2011 taxes free By selecting the method that is best for you, you will have quick and easy access to tax help. File my 2011 taxes free Contacting your Taxpayer Advocate. File my 2011 taxes free   The Taxpayer Advocate Service (TAS) is an independent organization within the IRS whose employees assist taxpayers who are experiencing economic harm, who are seeking help in resolving tax problems that have not been resolved through normal channels, or who believe that an IRS system or procedure is not working as it should. File my 2011 taxes free   You can contact the TAS by calling the TAS toll-free case intake line at 1-877-777-4778 or TTY/TDD 1-800-829-4059 to see if you are eligible for assistance. File my 2011 taxes free You can also call or write to your local taxpayer advocate, whose phone number and address are listed in your local telephone directory and in Publication 1546, Taxpayer Advocate Service — Your Voice at the IRS. File my 2011 taxes free You can file Form 911, Request for Taxpayer Advocate Service Assistance (And Application for Taxpayer Assistance Order), or ask an IRS employee to complete it on your behalf. File my 2011 taxes free For more information, go to www. File my 2011 taxes free irs. File my 2011 taxes free gov/advocate. File my 2011 taxes free Low Income Taxpayer Clinics (LITCs). File my 2011 taxes free   LITCs are independent organizations that provide low income taxpayers with representation in federal tax controversies with the IRS for free or for a nominal charge. File my 2011 taxes free The clinics also provide tax education and outreach for taxpayers who speak English as a second language. File my 2011 taxes free Publication 4134, Low Income Taxpayer Clinic List, provides information on clinics in your area. File my 2011 taxes free It is available at www. File my 2011 taxes free irs. File my 2011 taxes free gov or your local IRS office. File my 2011 taxes free Free tax services. File my 2011 taxes free   To find out what services are available, get Publication 910, IRS Guide to Free Tax Services. File my 2011 taxes free It contains lists of free tax information sources, including publications, services, and free tax education and assistance programs. File my 2011 taxes free It also has an index of over 100 TeleTax topics, (recorded tax information) you can listen to on your telephone. File my 2011 taxes free   Accessible versions of IRS published products are available on request in a variety of alternative formats for people with disabilities. File my 2011 taxes free Free help with your return. File my 2011 taxes free   Free help in preparing your return is available nationwide from IRS-trained volunteers. File my 2011 taxes free The Volunteer Income Tax Assistance (VITA) program is designed to help low-income taxpayers and Tax Counseling for the Elderly (TCE) program is designed to assist taxpayers age 60 and older with their tax returns. File my 2011 taxes free Many VITA sites offer free electronic filing and all volunteers will let you know about credits and deductions you may be entitled to claim. File my 2011 taxes free To find a site near you, call 1-800-829-1040. File my 2011 taxes free Or to find the nearest AARP TaxAide site, visit AARP's website at www. File my 2011 taxes free aarp. File my 2011 taxes free org/taxaide or call 1-888-227-7669. File my 2011 taxes free For more information on these programs, go to www. File my 2011 taxes free irs. File my 2011 taxes free gov and enter keyword “VITA” in the upper right-hand corner. File my 2011 taxes free Internet. File my 2011 taxes free You can access the IRS website at www. File my 2011 taxes free irs. File my 2011 taxes free gov 24 hours a day, 7 days a week to: E-file your return. File my 2011 taxes free Find out about commercial tax preparation and e-file services available free to eligible taxpayers. File my 2011 taxes free Check the status of your refund. File my 2011 taxes free Click on Where's My Refund. File my 2011 taxes free Wait at least 6 weeks from the date you filed your return (3 weeks if you filed electronically). File my 2011 taxes free Have your tax return available because you will need to know your social security number, your filing status, and the exact whole dollar amount of your refund. File my 2011 taxes free Download forms, instructions, and publications. File my 2011 taxes free Order IRS products online. File my 2011 taxes free Research your tax questions online. File my 2011 taxes free Search publications online by topic or keyword. File my 2011 taxes free View Internal Revenue Bulletins (IRBs) published in the last few years. File my 2011 taxes free Figure your withholding allowances using the withholding calculator online at www. File my 2011 taxes free irs. File my 2011 taxes free gov/individuals. File my 2011 taxes free Determine if Form 6251 must be filed using our Alternative Minimum Tax (AMT) Assistant. File my 2011 taxes free Sign up to receive local and national tax news by email. File my 2011 taxes free Get information on starting and operating a small business. File my 2011 taxes free Phone. File my 2011 taxes free Many services are available by phone. File my 2011 taxes free Ordering forms, instructions, and publications. File my 2011 taxes free Call 1-800-829-3676 to order current-year forms, instructions, and publications, and prior-year forms and instructions. File my 2011 taxes free You should receive your order within 10 days. File my 2011 taxes free Asking tax questions. File my 2011 taxes free Call the IRS with your tax questions at 1-800-829-1040. File my 2011 taxes free Solving problems. File my 2011 taxes free You can get face-to-face help solving tax problems every business day in IRS Taxpayer Assistance Centers. File my 2011 taxes free An employee can explain IRS letters, request adjustments to your account, or help you set up a payment plan. File my 2011 taxes free Call your local Taxpayer Assistance Center for an appointment. File my 2011 taxes free To find the number, go to www. File my 2011 taxes free irs. File my 2011 taxes free gov/localcontacts or look in the phone book under United States Government, Internal Revenue Service. File my 2011 taxes free TTY/TDD equipment. File my 2011 taxes free If you have access to TTY/TDD equipment, call 1-800-829-4059 to ask tax questions or to order forms and publications. File my 2011 taxes free TeleTax topics. File my 2011 taxes free Call 1-800-829-4477 to listen to pre-recorded messages covering various tax topics. File my 2011 taxes free Refund information. File my 2011 taxes free To check the status of your refund, call 1-800-829-4477 and press 1 for automated refund information or call 1-800-829-1954. File my 2011 taxes free Be sure to wait at least 6 weeks from the date you filed your return (3 weeks if you filed electronically). File my 2011 taxes free Have your tax return available because you will need to know your social security number, your filing status, and the exact whole dollar amount of your refund. File my 2011 taxes free Evaluating the quality of our telephone services. File my 2011 taxes free To ensure IRS representatives give accurate, courteous, and professional answers, we use several methods to evaluate the quality of our telephone services. File my 2011 taxes free One method is for a second IRS representative to listen in on or record random telephone calls. File my 2011 taxes free Another is to ask some callers to complete a short survey at the end of the call. File my 2011 taxes free Walk-in. File my 2011 taxes free Many products and services are available on a walk-in basis. File my 2011 taxes free Products. File my 2011 taxes free You can walk in to many post offices, libraries, and IRS offices to pick up certain forms, instructions, and publications. File my 2011 taxes free Some IRS offices, libraries, grocery stores, copy centers, city and county government offices, credit unions, and office supply stores have a collection of products available to print from a CD or photocopy from reproducible proofs. File my 2011 taxes free Also, some IRS offices and libraries have the Internal Revenue Code, regulations, Internal Revenue Bulletins, and Cumulative Bulletins available for research purposes. File my 2011 taxes free Services. File my 2011 taxes free You can walk in to your local Taxpayer Assistance Center every business day for personal, face-to-face tax help. File my 2011 taxes free An employee can explain IRS letters, request adjustments to your tax account, or help you set up a payment plan. File my 2011 taxes free If you need to resolve a tax problem, have questions about how the tax law applies to your individual tax return, or you're more comfortable talking with someone in person, visit your local Taxpayer Assistance Center where you can spread out your records and talk with an IRS representative face-to-face. File my 2011 taxes free No appointment is necessary — just walk in. File my 2011 taxes free If you prefer, you can call your local Center and leave a message requesting an appointment to resolve a tax account issue. File my 2011 taxes free A representative will call you back within 2 business days to schedule an in-person appointment at your convenience. File my 2011 taxes free If you have an ongoing, complex tax account problem or a special need, such as a disability, an appointment may be requested. File my 2011 taxes free All other issues will be handled without an appointment. File my 2011 taxes free To find the number of your local office, go to www. File my 2011 taxes free irs. File my 2011 taxes free gov/localcontacts or look in the phone book under United States Government, Internal Revenue Service. File my 2011 taxes free Mail. File my 2011 taxes free You can send your order for forms, instructions, and publications to the address below. File my 2011 taxes free You should receive a response within 10 days after your request is received. File my 2011 taxes free Internal Revenue Service 1201 N. File my 2011 taxes free Mitsubishi Motorway Bloomington, IL 61705-6613 CD/DVD for tax products. File my 2011 taxes free You can order Publication 1796, IRS Tax Products CD/DVD, and obtain: Current-year forms, instructions, and publications. File my 2011 taxes free Prior-year forms, instructions, and publications. File my 2011 taxes free Bonus: Historical Tax Products DVD - Ships with the final release. File my 2011 taxes free IRS Tax Map: an electronic research tool and finding aid. File my 2011 taxes free Tax law frequently asked questions (FAQ). File my 2011 taxes free Tax Topics from the IRS telephone response system. File my 2011 taxes free Fill-in, print, and save features for most tax forms. File my 2011 taxes free Internal Revenue Bulletins. File my 2011 taxes free Toll-free and email technical support. File my 2011 taxes free The CD/DVD is released twice during the year in January and March. File my 2011 taxes free Purchase the CD/DVD from National Technical Information Service (NTIS) at www. File my 2011 taxes free irs. File my 2011 taxes free gov/cdorders for $35 (no handling fee) or call 1-877-CDFORMS (1-877-233-6767) toll free to buy the CD/DVD for $35 (plus a $5 handling fee). File my 2011 taxes free Price is subject to change. File my 2011 taxes free CD for small businesses. File my 2011 taxes free Publication 3207, The Small Business Resource Guide CD, is a must for every small business owner or any taxpayer about to start a business. File my 2011 taxes free This year's CD includes: Helpful information, such as how to prepare a business plan, find financing for your business, and much more. File my 2011 taxes free All the business tax forms, instructions, and publications needed to successfully manage a business. File my 2011 taxes free Tax law changes. File my 2011 taxes free Tax Map: an electronic research tool and finding aid. File my 2011 taxes free Web links to various government agencies, business associations, and IRS organizations. File my 2011 taxes free “Rate the Product” survey—your opportunity to suggest changes for future editions. File my 2011 taxes free A site map of the CD to help you navigate the pages of the CD with ease. File my 2011 taxes free An interactive “Teens in Biz” module that gives practical tips for teens about starting their own business, creating a business plan, and filing taxes. File my 2011 taxes free An updated version of this CD is available each year in early April. File my 2011 taxes free You can get a free copy by calling 1-800-829-3676 or by visiting www. File my 2011 taxes free irs. File my 2011 taxes free gov/smallbiz. File my 2011 taxes free Prev  Up  Next   Home   More Online Publications
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Protect Yourself Online

Every day, millions of computer users share files online. Whether it is music, games, video, or software, peer-to-peer (P2P) file sharing allows users to share all kinds of content. To share files, you download special software that connects your computer to an informal network of other computers running the same software. Millions of users could be connected to each other through this software at one time. The software is often free and easy to access.

However, file sharing can have a number of risks. For example, when you are connected to file-sharing programs, you could unknowingly allow others to copy private files you never intended to share. You could download material that is protected by copyright laws and find yourself mired in legal issues. You could download a virus or facilitate a security breach. Or you could unwittingly download pornography labeled as something else.

To secure the personal information stored on your computer, the FTC suggests that you:

  • Set up the file-sharing software very carefully.
  • Be aware of spyware. Use a good anti-spyware program.
  • Close your connection when you're not using it.
  • Use an effective anti-virus program and update it regularly.
  • Talk with your family about file sharing.

For more complete information on P2P, visit the FTC's website, OnguardOnline.

Online Copyright Issues

Quite simply, to make or download unauthorized copies of software is to break the law, no matter how many copies are involved. Whether you are casually making a few copies for friends, loaning disks, distributing and/or downloading pirated software via the Internet, or buying a single software program and then installing it on 100 computers, you are committing a copyright infringement. It doesn't matter if you make money or not. If you or your company is caught copying software, you may be held liable under both civil and criminal law.

If the copyright owner brings a civil action against you, the owner can stop you from using its software immediately and can also request monetary damages. The copyright owner can sue for as much as $150,000 for each program copied. In addition, the government can criminally prosecute you for copyright infringement. If convicted, you can be fined up to $250,000, be sentenced to jail for up to five years, or both.

For more information contact the U.S. Department of Justice or the Business Software alliance, with content on online piracy issues.

The File My 2011 Taxes Free

File my 2011 taxes free 1. File my 2011 taxes free   Tax Withholding for 2014 Table of Contents Introduction Useful Items - You may want to see: Salaries and WagesDetermining Amount of Tax Withheld Using Form W-4 Completing Form W-4 and Worksheets Getting the Right Amount of Tax Withheld Rules Your Employer Must Follow Exemption From Withholding Supplemental Wages Penalties Tips Taxable Fringe BenefitsSpecial rule. File my 2011 taxes free Exceptions. File my 2011 taxes free Sick Pay Pensions and AnnuitiesPeriodic Payments Nonperiodic Payments Eligible Rollover Distributions Choosing Not To Have Income Tax Withheld Gambling WinningsException. File my 2011 taxes free Identical wagers. File my 2011 taxes free Unemployment Compensation Federal Payments Backup WithholdingTaxpayer identification number. File my 2011 taxes free Underreported interest or dividends. File my 2011 taxes free Introduction This chapter discusses income tax withholding on: Salaries and wages, Tips, Taxable fringe benefits, Sick pay, Pensions and annuities, Gambling winnings, Unemployment compensation, and Certain federal payments. File my 2011 taxes free This chapter explains in detail the rules for withholding tax from each of these types of income. File my 2011 taxes free The discussion of salaries and wages includes an explanation of how to complete Form W-4. File my 2011 taxes free This chapter also covers backup withholding on interest, dividends, and other payments. File my 2011 taxes free Useful Items - You may want to see: Form (and Instructions) W-4 Employee's Withholding Allowance Certificate W-4P Withholding Certificate for Pension or Annuity Payments W-4S Request for Federal Income Tax Withholding From Sick Pay W-4V Voluntary Withholding Request See chapter 5 of this publication for information about getting these publications and forms. File my 2011 taxes free Salaries and Wages Income tax is withheld from the pay of most employees. File my 2011 taxes free Your pay includes your regular pay, bonuses, commissions, and vacation allowances. File my 2011 taxes free It also includes reimbursements and other expense allowances paid under a nonaccountable plan. File my 2011 taxes free See Supplemental Wages , later, for definitions of accountable and nonaccountable plans. File my 2011 taxes free If your income is low enough that you will not have to pay income tax for the year, you may be exempt from withholding. File my 2011 taxes free This is explained under Exemption From Withholding , later. File my 2011 taxes free You can ask your employer to withhold income tax from noncash wages and other wages not subject to withholding. File my 2011 taxes free If your employer does not agree to withhold tax, or if not enough is withheld, you may have to pay estimated tax, as discussed in chapter 2. File my 2011 taxes free Military retirees. File my 2011 taxes free   Military retirement pay is treated in the same manner as regular pay for income tax withholding purposes, even though it is treated as a pension or annuity for other tax purposes. File my 2011 taxes free Household workers. File my 2011 taxes free   If you are a household worker, you can ask your employer to withhold income tax from your pay. File my 2011 taxes free A household worker is an employee who performs household work in a private home, local college club, or local fraternity or sorority chapter. File my 2011 taxes free   Tax is withheld only if you want it withheld and your employer agrees to withhold it. File my 2011 taxes free If you do not have enough income tax withheld, you may have to pay estimated tax, as discussed in chapter 2. File my 2011 taxes free Farmworkers. File my 2011 taxes free   Generally, income tax is withheld from your cash wages for work on a farm unless your employer both: Pays you cash wages of less than $150 during the year, and Has expenditures for agricultural labor totaling less than $2,500 during the year. File my 2011 taxes free Differential wage payments. File my 2011 taxes free   When employees are on leave from employment for military duty, some employers make up the difference between the military pay and civilian pay. File my 2011 taxes free Payments to an employee who is on active duty for a period of more than 30 days will be subject to income tax withholding, but not subject to social security or Medicare taxes. File my 2011 taxes free The wages and withholding will be reported on Form W-2, Wage and Tax Statement. File my 2011 taxes free Determining Amount of Tax Withheld Using Form W-4 The amount of income tax your employer withholds from your regular pay depends on two things. File my 2011 taxes free The amount you earn in each payroll period. File my 2011 taxes free The information you give your employer on Form W-4. File my 2011 taxes free Form W-4 includes four types of information that your employer will use to figure your withholding. File my 2011 taxes free Whether to withhold at the single rate or at the lower married rate. File my 2011 taxes free How many withholding allowances you claim (each allowance reduces the amount withheld). File my 2011 taxes free Whether you want an additional amount withheld. File my 2011 taxes free Whether you are claiming an exemption from withholding in 2014. File my 2011 taxes free See Exemption From Withholding , later. File my 2011 taxes free Note. File my 2011 taxes free You must specify a filing status and a number of withholding allowances on Form W-4. File my 2011 taxes free You cannot specify only a dollar amount of withholding. File my 2011 taxes free New Job When you start a new job, you must fill out a Form W-4 and give it to your employer. File my 2011 taxes free Your employer should have copies of the form. File my 2011 taxes free If you need to change the information later, you must fill out a new form. File my 2011 taxes free If you work only part of the year (for example, you start working after the beginning of the year), too much tax may be withheld. File my 2011 taxes free You may be able to avoid overwithholding if your employer agrees to use the part-year method. File my 2011 taxes free See Part-Year Method , later, for more information. File my 2011 taxes free Employee also receiving pension income. File my 2011 taxes free   If you receive pension or annuity income and begin a new job, you will need to file Form W-4 with your new employer. File my 2011 taxes free However, you can choose to split your withholding allowances between your pension and job in any manner. File my 2011 taxes free Changing Your Withholding During the year changes may occur to your marital status, exemptions, adjustments, deductions, or credits you expect to claim on your tax return. File my 2011 taxes free When this happens, you may need to give your employer a new Form W-4 to change your withholding status or number of allowances. File my 2011 taxes free If the changes reduce the number of allowances you are allowed to claim or changes your marital status from married to single, you must give your employer a new Form W-4 within 10 days. File my 2011 taxes free See Marital Status (Line 3 of Form W-4) and Withholding Allowances (Line 5 of Form W-4) , later. File my 2011 taxes free Generally, you can submit a new Form W-4 whenever you wish to change your withholding allowances for any other reason. File my 2011 taxes free See Table 1-1 for examples of personal and financial changes you should consider. File my 2011 taxes free Table 1-1. File my 2011 taxes free Personal and Financial Changes Factor Examples Lifestyle change Marriage Divorce Birth or adoption of child Loss of an exemption Purchase of a new home Retirement Filing chapter 11 bankruptcy Wage income You or your spouse start or stop working, or start or stop a second job Change in the amount of taxable income not subject to withholding Interest income Dividends Capital gains Self-employment income IRA (including certain Roth  IRA) distributions Change in the amount of adjustments to income IRA deduction Student loan interest deduction Alimony expense Change in the amount of itemized deductions or tax credits Medical expenses Taxes Interest expense Gifts to charity Job expenses Dependent care expenses Education credit Child tax credit Earned income credit If you change the number of your withholding allowances, you can request that your employer withhold using the Cumulative Wage Method , explained later. File my 2011 taxes free Checking Your Withholding After you have given your employer a Form W-4, you can check to see whether the amount of tax withheld from your pay is too much or too little. File my 2011 taxes free If too much or too little tax is being withheld, you should give your employer a new Form W-4 to change your withholding. File my 2011 taxes free You can get a blank Form W-4 from your employer or print the form from IRS. File my 2011 taxes free gov. File my 2011 taxes free You should try to have your withholding match your actual tax liability. File my 2011 taxes free If not enough tax is withheld, you will owe tax at the end of the year and may have to pay interest and a penalty. File my 2011 taxes free If too much tax is withheld, you will lose the use of that money until you get your refund. File my 2011 taxes free Always check your withholding if there are personal or financial changes in your life or changes in the law that might change your tax liability. File my 2011 taxes free See Table 1-1 for examples. File my 2011 taxes free Note. File my 2011 taxes free You cannot give your employer a payment to cover federal income tax withholding on salaries and wages for past pay periods or a payment for estimated tax. File my 2011 taxes free When Should You Check Your Withholding? The earlier in the year you check your withholding, the easier it is to get the right amount of tax withheld. File my 2011 taxes free You should check your withholding when any of the following situations occur. File my 2011 taxes free You receive a paycheck stub (statement) covering a full pay period in 2014, showing tax withheld based on 2014 tax rates. File my 2011 taxes free You prepare your 2013 tax return and get a: Big refund, or Balance due that is: More than you can comfortably pay, or Subject to a penalty. File my 2011 taxes free There are changes in your life or financial situation that affect your tax liability. File my 2011 taxes free See Table 1-1. File my 2011 taxes free There are changes in the tax law that affect your tax liability. File my 2011 taxes free How Do You Check Your Withholding? You can use the worksheets and tables in this publication to see if you are having the right amount of tax withheld. File my 2011 taxes free You can also use the IRS Withholding calculator at www. File my 2011 taxes free irs. File my 2011 taxes free gov/individuals. File my 2011 taxes free If you use the worksheets and tables in this publication, follow these steps. File my 2011 taxes free Fill out Worksheet 1-5 to project your total federal income tax liability for 2014. File my 2011 taxes free Fill out Worksheet 1-7 to project your total federal withholding for 2014 and compare that with your projected tax liability from Worksheet 1-5. File my 2011 taxes free If you are not having enough tax withheld, line 6 of Worksheet 1-7 will show you how much more to have withheld each payday. File my 2011 taxes free For ways to increase the amount of tax withheld, see How Do You Increase Your Withholding? If line 5 of Worksheet 1-7 shows that you are having more tax withheld than necessary, see How Do You Decrease Your Withholding, for ways to decrease the amount of tax you have withheld each payday. File my 2011 taxes free How Do You Increase Your Withholding? There are two ways to increase your withholding. File my 2011 taxes free You can: Decrease the number of allowances you claim on Form W-4, or Enter an additional amount that you want withheld from each paycheck on Form W-4. File my 2011 taxes free Requesting an additional amount withheld. File my 2011 taxes free   You can request that an additional amount be withheld from each paycheck by following these steps. File my 2011 taxes free Complete Worksheets 1-5 and 1-7. File my 2011 taxes free Complete a new Form W-4 if the amount on Worksheet 1-7, line 5: Is more than you want to pay with your tax return or in estimated tax payments throughout the year, or Would cause you to pay a penalty when you file your tax return for 2014. File my 2011 taxes free Enter on your new Form W-4, the same number of withholding allowances your employer now uses for your withholding. File my 2011 taxes free This is the number of allowances you entered on the last Form W-4 you gave your employer. File my 2011 taxes free Enter on your new Form W-4, the amount from Worksheet 1-7, line 6. File my 2011 taxes free Give your newly completed Form W-4 to your employer. File my 2011 taxes free   If you have this additional amount withheld from your pay each payday, you should avoid owing a large amount at the end of the year. File my 2011 taxes free Example. File my 2011 taxes free Early in 2014, Steve Miller used Worksheets 1-5, 1-6, and 1-7 to project his 2014 tax liability ($4,316) and his withholding for the year ($3,516). File my 2011 taxes free Steve's tax will be underwithheld by $800 ($4,316 − $3,516). File my 2011 taxes free His choices are to pay this amount when he files his 2014 tax return, make estimated tax payments, or increase his withholding now. File my 2011 taxes free Steve gets a new Form W-4 from his employer, who tells him that there are 50 paydays remaining in 2014. File my 2011 taxes free Steve completes the new Form W-4 as before, entering the same number of withholding allowances as before, but, in addition, entering $16 ($800 ÷ 50) on the form as the additional amount to be withheld from his pay each payday. File my 2011 taxes free He gives the completed form to his employer. File my 2011 taxes free What if I have more than one job or my spouse also has a job?   You are more likely to need to increase your withholding if you have more than one job or if you are married filing jointly and your spouse also works. File my 2011 taxes free If this is the case, you can increase your withholding for one or more of the jobs. File my 2011 taxes free   You can apply the amount on Worksheet 1-7, line 5, to only one job or divide it between the jobs any way you wish. File my 2011 taxes free For each job, determine the extra amount that you want to apply to that job and divide that amount by the number of paydays remaining in 2014 for that job. File my 2011 taxes free This will give you the additional amount to enter on the Form W-4 you will file for that job. File my 2011 taxes free You need to give your employer a new Form W-4 for each job for which you are changing your withholding. File my 2011 taxes free Example. File my 2011 taxes free Meg Green works in a store and earns $46,000 a year. File my 2011 taxes free Her husband, John, works full-time in manufacturing and earns $68,000 a year. File my 2011 taxes free In 2014, they will also have $184 in taxable interest and $1,000 of other taxable income. File my 2011 taxes free They expect to file a joint income tax return. File my 2011 taxes free Meg and John complete Worksheets 1-5, 1-6, and 1-7. File my 2011 taxes free Line 5 of Worksheet 1-7 shows that they will owe an additional $4,459 after subtracting their withholding for the year. File my 2011 taxes free They can divide the $4,459 any way they want. File my 2011 taxes free They can enter an additional amount on either of their Forms W-4, or divide it between them. File my 2011 taxes free They decide to have the additional amount withheld from John's wages, so they enter $91 ($4,459 ÷ 49 remaining paydays) on his Form W-4. File my 2011 taxes free Both claim the same number of allowances as before. File my 2011 taxes free How Do You Decrease Your Withholding? If your completed Worksheets 1-5 and 1-7 show that you may have more tax withheld than your projected tax liability for 2014, you may be able to decrease your withholding. File my 2011 taxes free There are two ways to do this. File my 2011 taxes free You can: Decrease any additional amount you are having withheld, or Increase the number of allowances you claim on Form W-4. File my 2011 taxes free You can claim only the number of allowances to which you are entitled. File my 2011 taxes free To see if you can decrease your withholding by increasing your allowances, see the Form W-4 instructions and the rest of this publication. File my 2011 taxes free Increasing the number of allowances. File my 2011 taxes free   Figure and increase the number of withholding allowances you can claim as follows. File my 2011 taxes free On a new Form W-4, complete the Personal Allowances Worksheet. File my 2011 taxes free If you plan to itemize deductions, claim adjustments to income, or claim tax credits, complete a new Deductions and Adjustments Worksheet. File my 2011 taxes free If you plan to claim tax credits, see Converting Credits to Withholding Allowances, later. File my 2011 taxes free If you meet the criteria on line H of the Form W-4 Personal Allowances Worksheet, complete a new Two-Earners/Multiple Jobs Worksheet. File my 2011 taxes free If the number of allowances you can claim on Form W-4, is different from the number you already are claiming, give the newly completed Form W-4 to your employer. File my 2011 taxes free Converting Credits to Withholding Allowances Table 1-2 , later, shows many of the tax credits you may be able to use to decrease your withholding. File my 2011 taxes free The Form W-4 Personal Allowances Worksheet provides only rough adjustments for the child and dependent care credit and the child tax credit. File my 2011 taxes free Complete Worksheet 1-8 to figure these credits more accurately and also take other credits into account. File my 2011 taxes free Include the amount from line 12 of Worksheet 1-8 in the total on line 5 of the Deductions and Adjustments Worksheet. File my 2011 taxes free Then complete the Deductions and Adjustments Worksheet and the rest of Form W-4. File my 2011 taxes free If you take the child and dependent care credit into account on Worksheet 1-8, enter -0- on line F of the Personal Allowances Worksheet. File my 2011 taxes free If you take the child tax credit into account on Worksheet 1-8, enter -0- on line G of the Personal Allowances Worksheet. File my 2011 taxes free Example. File my 2011 taxes free Brett and Alyssa Davis are married and expect to file a joint return for 2014. File my 2011 taxes free Their expected taxable income from all sources is $68,000. File my 2011 taxes free They expect to have $15,900 of itemized deductions. File my 2011 taxes free Their projected tax credits include a child and dependent care credit of $960 and an adoption credit of $1,500. File my 2011 taxes free The Davis' complete Worksheet 1-8, as follows, to see whether they can convert their tax credits into additional withholding allowances. File my 2011 taxes free Line 1, expected child and dependent care credit—$960. File my 2011 taxes free Line 9, expected adoption credit—$1,500. File my 2011 taxes free Line 10, total estimated tax credits—$2,460. File my 2011 taxes free Line 11. File my 2011 taxes free Their combined total income from all sources, $68,000, falls between $42,001 and $98,000 on the table for married filing jointly or qualifying widow(er). File my 2011 taxes free The number to the right of this range is 6. File my 2011 taxes free 7. File my 2011 taxes free Line 12, multiply line 10 by line 11—$16,482. File my 2011 taxes free Then the Davis' complete the Form W-4 worksheets. File my 2011 taxes free Because they choose to account for their child and dependent care credit on the Deductions and Adjustments Worksheet, they enter -0- on line F of the Personal Allowances Worksheet and figure a new total for line H. File my 2011 taxes free They take the result on line 12 of Worksheet 1-8, add it to their other adjustments on line 5 of the Form W-4 Deductions and Adjustments Worksheet, and complete the Form W-4 worksheets. File my 2011 taxes free When Will Your New Form W-4 Go Into Effect? If the change is for the current year, your employer must put your new Form W-4 into effect no later than the start of the first payroll period ending on or after the 30th day after the day on which you give your employer your revised Form W-4. File my 2011 taxes free If the change is for next year, your new Form W-4 will not take effect until next year. File my 2011 taxes free Retirees Returning to the Workforce When you first began receiving your pension, you told the payer how much tax to withhold, if any, by completing Form W-4P, Withholding Certificate for Pension or Annuity Payments (or similar form). File my 2011 taxes free However, if your retirement pay is from the military or certain deferred compensation plans, you completed Form W-4 instead of Form W-4P. File my 2011 taxes free You completed either form based on your projected income at that time. File my 2011 taxes free Now that you are returning to the workforce, your new Form W-4 (given to your employer) and your Form W-4 or W-4P (on file with your pension plan) must work together to determine the correct amount of withholding for your new amount of income. File my 2011 taxes free The worksheets that come with Forms W-4 and W-4P are basically the same, so you can use either set of worksheets to figure out how many withholding allowances you are entitled to claim. File my 2011 taxes free Start off with the Personal Allowances Worksheet. File my 2011 taxes free Then, if you will be itemizing your deductions, claiming adjustments to income, or claiming tax credits when you file your tax return, complete the Deductions and Adjustments Worksheet. File my 2011 taxes free The third worksheet is the most important for this situation. File my 2011 taxes free Form W-4 calls it the Two-Earners/Multiple Jobs Worksheet, Form W-4P calls it the Multiple Pensions/More-Than-One-Income Worksheet—both are the same. File my 2011 taxes free If you have more than one source of income, in order to have enough withholding to cover the tax on your higher income, you may need to claim fewer withholding allowances or request your employer to withhold an additional amount from each paycheck. File my 2011 taxes free Once you have figured out how many allowances you are entitled to claim, look at the income from both your pension and your new job, and how often you receive payments. File my 2011 taxes free It is your decision how to divide up your withholding allowances between these sources of income. File my 2011 taxes free For example, you may want to “take home” most of your weekly paycheck to use as spending money and use your monthly pension to “pay the bills. File my 2011 taxes free ” In that case, change your Form W-4P to zero allowances and claim all that you are entitled to on your Form W-4. File my 2011 taxes free There are a couple of ways you can get a better idea of how much tax will be withheld when claiming a certain number of allowances. File my 2011 taxes free Use the withholding tables in Publication 15 (Circular E), Employer's Tax Guide. File my 2011 taxes free Contact your pension provider and your employer's payroll department. File my 2011 taxes free And remember, this is not a final decision. File my 2011 taxes free If you do not get the correct amount of withholding with the first Forms W-4 and W-4P you submit, you should refigure your allowances (or divide them differently) using the information and worksheets in this publication, or the resources mentioned above. File my 2011 taxes free You should go through this same process each time your life situation changes, whether it be for personal or financial reasons. File my 2011 taxes free You may need more tax withheld, or you may need less. File my 2011 taxes free Table 1-2. File my 2011 taxes free Tax Credits for 2014 For more information about the . File my 2011 taxes free . File my 2011 taxes free . File my 2011 taxes free See . File my 2011 taxes free . File my 2011 taxes free . File my 2011 taxes free Adoption credit Form 8839 instructions Child and dependent care expenses, credit for Publication 503, Child and Dependent Care Expenses Child tax credit (including the additional child tax credit) Instructions for Form 1040 or Form 1040A Earned income credit Publication 596, Earned Income Credit Education credits Publication 970, Tax Benefits for Education Elderly or the disabled, credit for the Publication 524, Credit for the Elderly or the Disabled Foreign tax credit (except any credit that applies to wages not subject to U. File my 2011 taxes free S. File my 2011 taxes free income tax withholding because they are subject to income tax withholding by a foreign country) Publication 514, Foreign Tax Credit for Individuals General business credit Form 3800, General Business Credit Mortgage interest credit Publication 530, Tax Information for First-Time Homeowners Qualified electric vehicle passive activity credit Form 8834 Prior year minimum tax, credit for (if you paid alternative minimum tax in an earlier year) Form 8801 instructions Retirement savings contributions credit (saver's credit) Publication 590, Individual Retirement Arrangements (IRAs) Tax credit bonds, credit to holders of Form 8912 instructions Completing Form W-4 and Worksheets When reading the following discussion, you may find it helpful to refer to Form W-4. File my 2011 taxes free Marital Status There is a lower withholding rate for people who qualify to check the “Married” box on line 3 of Form W-4. File my 2011 taxes free Everyone else must have tax withheld at the higher single rate. File my 2011 taxes free Single. File my 2011 taxes free   You must check the “Single” box if any of the following applies. File my 2011 taxes free You are single. File my 2011 taxes free If you are divorced, or separated from your spouse under a court decree of separate maintenance, you are considered single. File my 2011 taxes free You are married, but neither you nor your spouse is a citizen or resident of the United States. File my 2011 taxes free You are married, either you or your spouse is a nonresident alien, and you have not chosen to have that person treated as a resident alien for tax purposes. File my 2011 taxes free For more information, see Nonresident Spouse Treated as a Resident in chapter 1 of Publication 519. File my 2011 taxes free Married. File my 2011 taxes free   You qualify to check the “Married” box if any of the following applies. File my 2011 taxes free You are married and neither you nor your spouse is a nonresident alien. File my 2011 taxes free You are considered married for the whole year even if your spouse died during the year. File my 2011 taxes free You are married and either you or your spouse is a nonresident alien who has chosen to be treated as a resident alien for tax purposes. File my 2011 taxes free For more information, see Nonresident Spouse Treated as a Resident in chapter 1 of Publication 519. File my 2011 taxes free You expect to be able to file your return as a qualifying widow or widower. File my 2011 taxes free You usually can use this filing status if your spouse died within the previous 2 years and you provide more than half the cost of keeping up a home for the entire year that was the main home for you and your child whom you can claim as a dependent. File my 2011 taxes free However, you must file a new Form W-4 showing your filing status as single by December 1 of the last year you are eligible to file as a qualifying widow or widower. File my 2011 taxes free For more information on this filing status, see Qualifying Widow(er) With Dependent Child under Filing Status in Publication 501, Exemptions, Standard Deduction, and Filing Information. File my 2011 taxes free Married, but withhold at higher single rate. File my 2011 taxes free   Some married people find that they do not have enough tax withheld at the married rate. File my 2011 taxes free This can happen, for example, when both spouses work. File my 2011 taxes free To avoid this, you can check the “Married, but withhold at higher Single rate” box (even if you qualify for the married rate). File my 2011 taxes free Also, you may find that more tax is withheld if you fill out the Two-Earners/Multiple Jobs Worksheet, explained later. File my 2011 taxes free Withholding Allowances The more allowances you claim on Form W-4, the less income tax your employer will withhold. File my 2011 taxes free You will have the most tax withheld if you claim “0” allowances. File my 2011 taxes free The number of allowances you can claim depends on the following factors. File my 2011 taxes free How many exemptions you can take on your tax return. File my 2011 taxes free Whether you have income from more than one job. File my 2011 taxes free What deductions, adjustments to income, and credits you expect to have for the year. File my 2011 taxes free Whether you will file as head of household. File my 2011 taxes free If you are married (filing jointly), it also depends on whether your spouse also works and claims any allowances on his or her own Form W-4. File my 2011 taxes free Or, if married filing separately, whether or not your spouse also works. File my 2011 taxes free Form W-4 worksheets. File my 2011 taxes free    Form W-4 has worksheets to help you figure how many withholding allowances you can claim. File my 2011 taxes free The worksheets are for your own records. File my 2011 taxes free Do not give them to your employer. File my 2011 taxes free   Complete only one set of Form W-4 worksheets, no matter how many jobs you have. File my 2011 taxes free If you are married and will file a joint return, complete only one set of worksheets for you and your spouse, even if you both earn wages and each must give Form W-4 to your employers. File my 2011 taxes free Complete separate sets of worksheets only if you and your spouse will file separate returns. File my 2011 taxes free   If you are not exempt from withholding (see Exemption From Withholding , later), complete the Personal Allowances Worksheet on page 1 of the form. File my 2011 taxes free Also, use the worksheets on page 2 of the form to adjust the number of your withholding allowances for itemized deductions and adjustments to income, and for two-earner or multiple-job situations. File my 2011 taxes free If you want to adjust the number of your withholding allowances for certain tax credits, use the Deductions and Adjustments Worksheet on page 2 of Form W-4, even if you do not have any deductions or adjustments. File my 2011 taxes free   Complete all worksheets that apply to your situation. File my 2011 taxes free The worksheets will help you figure the maximum number of withholding allowances you are entitled to claim so that the amount of income tax withheld from your wages will match, as closely as possible, the amount of income tax you will owe at the end of the year. File my 2011 taxes free Multiple jobs. File my 2011 taxes free   If you have income from more than one job at the same time, complete only one set of Form W-4 worksheets. File my 2011 taxes free Then split your allowances between the Forms W-4 for each job. File my 2011 taxes free You cannot claim the same allowances with more than one employer at the same time. File my 2011 taxes free You can claim all your allowances with one employer and none with the other(s), or divide them any other way. File my 2011 taxes free Married individuals. File my 2011 taxes free   If both you and your spouse are employed and expect to file a joint return, figure your withholding allowances using your combined income, adjustments, deductions, exemptions, and credits. File my 2011 taxes free Use only one set of worksheets. File my 2011 taxes free You can divide your total allowances any way, but you cannot claim an allowance that your spouse also claims. File my 2011 taxes free   If you and your spouse expect to file separate returns, figure your allowances using separate worksheets based on your own individual income, adjustments, deductions, exemptions, and credits. File my 2011 taxes free Alternative method of figuring withholding allowances. File my 2011 taxes free   You do not have to use the Form W-4 worksheets if you use a more accurate method of figuring the number of withholding allowances. File my 2011 taxes free   The method you use must be based on withholding schedules, the tax rate schedules, and the 2014 Estimated Tax Worksheet in chapter 2. File my 2011 taxes free It must take into account only the items of income, adjustments to income, deductions, and tax credits that are taken into account on Form W-4. File my 2011 taxes free   You can use the number of withholding allowances determined under an alternative method rather than the number determined using the Form W-4 worksheets. File my 2011 taxes free You still must give your employer a Form W-4 claiming your withholding allowances. File my 2011 taxes free Employees who are not citizens or residents. File my 2011 taxes free   If you are neither a citizen nor a resident of the United States, you usually can claim only one withholding allowance. File my 2011 taxes free However, this rule does not apply if you are a resident of Canada or Mexico, or if you are a U. File my 2011 taxes free S. File my 2011 taxes free national. File my 2011 taxes free It also does not apply if your spouse is a U. File my 2011 taxes free S. File my 2011 taxes free citizen or resident and you have chosen to be treated as a resident of the United States for tax purposes. File my 2011 taxes free Special rules apply to residents of South Korea and India. File my 2011 taxes free For more information, see Withholding From Compensation in chapter 8 of Publication 519. File my 2011 taxes free Personal Allowances Worksheet Use the Personal Allowances Worksheet on page 1 of Form W-4 to figure your withholding allowances based on all of the following that apply. File my 2011 taxes free Exemptions. File my 2011 taxes free Only one job. File my 2011 taxes free Head of household filing status. File my 2011 taxes free Child and dependent care credit. File my 2011 taxes free Child tax credit. File my 2011 taxes free Exemptions (worksheet lines A, C, and D). File my 2011 taxes free   You can claim one withholding allowance for each exemption you expect to claim on your tax return. File my 2011 taxes free Self. File my 2011 taxes free   You can claim an allowance for your exemption on line A unless another person can claim an exemption for you on his or her tax return. File my 2011 taxes free If another person is entitled to claim an exemption for you, you cannot claim an allowance for your exemption even if the other person will not claim your exemption. File my 2011 taxes free Spouse. File my 2011 taxes free   You can claim an allowance for your spouse's exemption on line C unless your spouse is claiming his or her own exemption or another person can claim an exemption for your spouse. File my 2011 taxes free Do not claim this allowance if you and your spouse expect to file separate returns. File my 2011 taxes free Dependents. File my 2011 taxes free   You can claim one allowance on line D for each exemption you will claim for a dependent on your tax return. File my 2011 taxes free Only one job (worksheet line B). File my 2011 taxes free    You can claim an additional withholding allowance if any of the following apply for 2014. File my 2011 taxes free You are single and you have only one job at a time. File my 2011 taxes free You are married, you have only one job at a time, and your spouse does not work. File my 2011 taxes free Your wages from a second job or your spouse's wages (or the total of both) are $1,500 or less. File my 2011 taxes free If you qualify for this allowance, enter “1” on line B of the worksheet. File my 2011 taxes free Head of household filing status (worksheet line E). File my 2011 taxes free   Generally, you can file as head of household if you are unmarried and pay more than half the cost of keeping up a home that: Was the main home for all of 2014 of your parent whom you can claim as a dependent, or You lived in for more than half the year with your qualifying child or any other person you can claim as a dependent. File my 2011 taxes free For more information, see Publication 501. File my 2011 taxes free   If you expect to file as head of household on your 2014 tax return, enter “1” on line E of the worksheet. File my 2011 taxes free Reduction of personal allowances. File my 2011 taxes free   For 2014, your deduction for personal exemptions on your tax return is reduced if your adjusted gross income (AGI) is more than the AGI shown next for your filing status. File my 2011 taxes free Personal Allowance Phaseout Threshold Single $254,200 Married filing jointly or qualifying widow(er) $305,050 Married filing separately $152,525 Head of household $279,650   If you expect your AGI to be more than the amount listed, use Worksheet 1-1 to figure your reduced number of personal allowances on lines A, C, and D of the Personal Allowances Worksheet. File my 2011 taxes free Worksheet 1-1. File my 2011 taxes free Personal Allowances Worksheet (Form W-4) Reduction of Personal Allowances if AGI Above Phaseout Threshold 1. File my 2011 taxes free Enter the total amount of allowances on lines A, C, and D of the Personal Allowance Worksheet without regard to the phaseout rule 1. File my 2011 taxes free   2. File my 2011 taxes free Enter your expected AGI 2. File my 2011 taxes free       3. File my 2011 taxes free Enter $254,200 if single $305,050 if married filing jointly or qualifying widow(er) $152,525 if married filing separately $279,650 if head of household 3. File my 2011 taxes free       4. File my 2011 taxes free Subtract line 3 from line 2 4. File my 2011 taxes free       5. File my 2011 taxes free Divide line 4 by $125,000 ($62,500 if married filing separately). File my 2011 taxes free Enter the result as a decimal 5. File my 2011 taxes free   6. File my 2011 taxes free Multiply line 1 by line 5. File my 2011 taxes free If the result is not a whole number, increase it to the next higher whole number 6. File my 2011 taxes free   7. File my 2011 taxes free Subtract line 6 from line 1. File my 2011 taxes free The total of the numbers you enter on A, C, and D of the Personal Allowances Worksheet can not be more than this amount 7. File my 2011 taxes free     Child and dependent care credit (worksheet line F). File my 2011 taxes free   Enter “1” on line F if you expect to claim a credit for at least $2,000 of qualifying child or dependent care expenses on your 2014 return. File my 2011 taxes free Generally, qualifying expenses are those you pay for the care of your dependent who is your qualifying child under age 13 or for your spouse or dependent who is not able to care for himself or herself so that you can work or look for work. File my 2011 taxes free For more information, see Publication 503, Child and Dependent Care Expenses. File my 2011 taxes free   Instead of using line F, you can choose to take the credit into account on line 5 of the Deductions and Adjustments Worksheet, as explained under Tax credits , later. File my 2011 taxes free Child tax credit (worksheet line G). File my 2011 taxes free   If your total income will be less than $65,000 ($95,000 if married), enter “2” on line G for each eligible child. File my 2011 taxes free Subtract “1” from that amount if you have three to six eligible children. File my 2011 taxes free Subtract “2” from that amount if you have seven or more eligible children. File my 2011 taxes free   If your total income will be between $65,000 and $84,000 ($95,000 and $119,000 if married), enter “1” on line G for each eligible child. File my 2011 taxes free   An eligible child is any child: Who is your son, daughter, stepchild, foster child, brother, sister, stepbrother, stepsister, half brother, half sister, or a descendant of any of them (for example, your grandchild, niece, or nephew), Who will be under age 17 at the end of 2014, Who is younger than you (or your spouse if filing jointly) or permanently and totally disabled, Who will not provide over half of his or her own support for 2014, Who will not file a joint return, unless the return is filed only as a claim for refund, Who will live with you for more than half of 2014, Who is a U. File my 2011 taxes free S. File my 2011 taxes free citizen, U. File my 2011 taxes free S. File my 2011 taxes free national, or U. File my 2011 taxes free S. File my 2011 taxes free resident alien, and Who will be claimed as a dependent on your return. File my 2011 taxes free If you are a U. File my 2011 taxes free S. File my 2011 taxes free citizen or U. File my 2011 taxes free S. File my 2011 taxes free national and your adopted child lived with you all year as a member of your household, that child meets the citizenship test. File my 2011 taxes free   Also, if any other person can claim the child as an eligible child, see Qualifying child of more than one person in the 2013 instructions for Form 1040 or 1040A, line 6c. File my 2011 taxes free   For more information about the child tax credit, see the instructions for Form 1040 or Form 1040A. File my 2011 taxes free   Instead of using line G, you can choose to take the credit into account on line 5 of the Deductions and Adjustments Worksheet, as explained under Tax credits , later. File my 2011 taxes free Total personal allowances (worksheet line H). File my 2011 taxes free    Add lines A through G and enter the total on line H. File my 2011 taxes free If you do not use either of the worksheets on the back of Form W-4, enter the number from line H on line 5 of Form W-4. File my 2011 taxes free Deductions and Adjustments Worksheet Use the Deductions and Adjustments Worksheet on page 2 of Form W-4 if you plan to itemize your deductions, claim certain credits, or claim adjustments to the income on your 2014 tax return and you want to reduce your withholding. File my 2011 taxes free Also, complete this worksheet when you have changes to those items to see if you need to change your withholding. File my 2011 taxes free Use the amount of each item you reasonably can expect to show on your return. File my 2011 taxes free However, do not use more than: The amount shown for that item on your 2013 return (or your 2012 return if you have not yet filed your 2013 return), plus Any additional amount related to a transaction or occurrence (such as payments already made, the signing of an agreement, or the sale of property) that you can prove has happened or will happen during 2013 or 2014. File my 2011 taxes free Do not include any amount shown on your last tax return that has been disallowed by the IRS. File my 2011 taxes free Example. File my 2011 taxes free On June 30, 2013, you bought your first home. File my 2011 taxes free On your 2013 tax return, you claimed itemized deductions of $6,600, the total mortgage interest and real estate tax you paid during the 6 months you owned your home. File my 2011 taxes free Based on your mortgage payment schedule and your real estate tax assessment, you reasonably can expect to claim deductions of $13,200 for those items on your 2014 return. File my 2011 taxes free You can use $13,200 to figure the number of your withholding allowances for itemized deductions. File my 2011 taxes free Not itemizing deductions. File my 2011 taxes free   If you expect to claim the standard deduction on your tax return, skip lines 1 and 2, and enter “0” on line 3 of the worksheet. File my 2011 taxes free Itemized deductions (worksheet line 1). File my 2011 taxes free   Enter your estimated total itemized deductions on line 1 of the worksheet. File my 2011 taxes free   Listed below are some of the deductions you can take into account when figuring additional withholding allowances for 2014. File my 2011 taxes free You normally claim these deductions on Schedule A of Form 1040. File my 2011 taxes free Medical and dental expenses that are more than 10% (7. File my 2011 taxes free 5% if either you or your spouse was born before January 2, 1950) of your 2014 AGI (defined under AGI , later). File my 2011 taxes free State and local income or property taxes. File my 2011 taxes free Deductible home mortgage interest. File my 2011 taxes free Investment interest up to net investment income. File my 2011 taxes free Charitable contributions. File my 2011 taxes free Casualty and theft losses that are more than $100 and 10% of your AGI. File my 2011 taxes free Fully deductible miscellaneous itemized deductions, including: Impairment-related work expenses of persons with disabilities, Federal estate tax on income in respect of a decedent, Repayment of more than $3,000 of income held under a claim of right that you included in income in an earlier year because at the time you thought you had an unrestricted right to it, Unrecovered investments in an annuity contract under which payments have ceased because of the annuitant's death, Gambling losses up to the amount of gambling winnings reported on your return, and Casualty and theft losses from  income-producing property. File my 2011 taxes free Other miscellaneous itemized deductions that are more than 2% of your AGI, including: Unreimbursed employee business expenses, such as education expenses, work clothes and uniforms, union dues and fees, and the cost of work-related small tools and supplies, Safe deposit box rental, Tax counsel and assistance, and Certain fees paid to an IRA trustee or custodian. File my 2011 taxes free AGI. File my 2011 taxes free   For the purpose of estimating your itemized deductions, your AGI is your estimated total income for 2014 minus any estimated adjustments to income (discussed later) that you include on line 4 of the Deductions and Adjustments Worksheet. File my 2011 taxes free Phaseout of itemized deductions. File my 2011 taxes free   For 2014, your total itemized deductions may be phased out (reduced) if your AGI is more than the following thresholds. File my 2011 taxes free    Itemized Deduction Phaseout Threshold Single $254,200 Married filing jointly or qualifying widow(er) $305,050 Married filing separately $152,525 Head of household $279,650   If you expect your AGI to be more than the amount listed, use Worksheet 1–2 to figure your reduction in itemized deductions. File my 2011 taxes free Worksheet 1-2. File my 2011 taxes free Deductions and Adjustments Worksheet (Form W-4)—Line 1 Phaseout of Itemized Deductions 1. File my 2011 taxes free Enter the estimated total of your itemized deductions 1. File my 2011 taxes free   2. File my 2011 taxes free Enter the amount included in line 1 for medical and dental expenses, investment interest, casualty or theft losses, and gambling losses 2. File my 2011 taxes free   3. File my 2011 taxes free Is the amount on line 2 less than the amount on line 1? ❑ No. File my 2011 taxes free Stop here. File my 2011 taxes free Your deduction is not limited. File my 2011 taxes free Enter the amount from line 1 above on line 1 of the Deductions and Adjustments Worksheet. File my 2011 taxes free  ❑ Yes. File my 2011 taxes free Subtract line 2 from line 1. File my 2011 taxes free 3. File my 2011 taxes free       4. File my 2011 taxes free Multiply line 3 by 80% (. File my 2011 taxes free 80) 4. File my 2011 taxes free       5. File my 2011 taxes free Enter your expected AGI 5. File my 2011 taxes free       6. File my 2011 taxes free Enter $305,050 If married filing jointly or qualifying widow(er), $279,650 if head of household, $254,200 if single, or $152,525 if married filing separately 6. File my 2011 taxes free   7. File my 2011 taxes free Is the amount on line 6 less than the amount on line 5? ❑ No. File my 2011 taxes free Stop here. File my 2011 taxes free Your deduction is not limited. File my 2011 taxes free Enter the amount from line 1 above on line 1 of the Deductions and Adjustments Worksheet. File my 2011 taxes free  ❑ Yes. File my 2011 taxes free Subtract line 6 from line 5. File my 2011 taxes free 7. File my 2011 taxes free       8. File my 2011 taxes free Multiply line 7 by 3% (. File my 2011 taxes free 03) 8. File my 2011 taxes free       9. File my 2011 taxes free Enter the smaller of line 4 or line 8 9. File my 2011 taxes free     10. File my 2011 taxes free Subtract line 9 from line 1. File my 2011 taxes free Enter the result here and on line 1 of the Deductions and Adjustments Worksheet 10. File my 2011 taxes free     Adjustments to income (worksheet line 4). File my 2011 taxes free   Enter your estimated total adjustments to income on line 4 of the Deductions and Adjustments Worksheet. File my 2011 taxes free   You can take the following adjustments to income into account when figuring additional withholding allowances for 2014. File my 2011 taxes free These adjustments appear on page 1 of your Form 1040 or 1040A. File my 2011 taxes free Net losses from Schedules C, D, E, and F of Form 1040 and from Part II of Form 4797, line 18b. File my 2011 taxes free Net operating loss carryovers. File my 2011 taxes free Certain business expenses of reservists, performing artists, and fee-based government officials. File my 2011 taxes free Health savings account or medical savings account deduction. File my 2011 taxes free Certain moving expenses. File my 2011 taxes free Deduction for self-employment tax. File my 2011 taxes free Deduction for contributions to self-employed SEP, and qualified SIMPLE plans. File my 2011 taxes free Self-employed health insurance deduction. File my 2011 taxes free Penalty on early withdrawal of savings. File my 2011 taxes free Alimony paid. File my 2011 taxes free IRA deduction. File my 2011 taxes free Student loan interest deduction. File my 2011 taxes free Jury duty pay given to your employer. File my 2011 taxes free Reforestation amortization and expenses. File my 2011 taxes free Deductible expenses related to income reported on line 21 from the rental of personal property engaged in for profit. File my 2011 taxes free Repayment of certain supplemental unemployment benefits. File my 2011 taxes free Contributions to IRC 501(c)(18)(D) pension plans. File my 2011 taxes free Contributions by certain chaplains to IRC 403(b) plans. File my 2011 taxes free Attorney fees and court costs for certain unlawful discrimination claims. File my 2011 taxes free Attorney fees and court costs for certain whistleblower awards. File my 2011 taxes free Estimated amount of decrease in tax attributable to income averaging using Schedule J (Form 1040). File my 2011 taxes free Tax credits (worksheet line 5). File my 2011 taxes free   Although you can take most tax credits into account when figuring withholding allowances, the Personal Allowances Worksheet uses only the child and dependent care credit (line F) and the child tax credit (line G). File my 2011 taxes free But you can take these credits and others into account by adding an extra amount on line 5 of the Deductions and Adjustments Worksheet. File my 2011 taxes free   If you take the child and dependent care credit into account on line 5, do not use line F. File my 2011 taxes free If you take the child tax credit into account on line 5, do not use line G. File my 2011 taxes free   In addition to the child and dependent care credit and the child tax credit, you can generally take into account the following credits. File my 2011 taxes free See the individual tax form instructions for more details. File my 2011 taxes free Foreign tax credit, except any credit that applies to wages not subject to U. File my 2011 taxes free S. File my 2011 taxes free income tax withholding because they are subject to income tax withholding by a foreign country. File my 2011 taxes free See Publication 514, Foreign Tax Credit for Individuals. File my 2011 taxes free Credit for the elderly or the disabled. File my 2011 taxes free See Publication 524, Credit for the Elderly or the Disabled. File my 2011 taxes free Education credits. File my 2011 taxes free See Publication 970, Tax Benefits for Education. File my 2011 taxes free Retirement savings contributions credit (saver's credit). File my 2011 taxes free See Publication 590. File my 2011 taxes free Mortgage interest credit. File my 2011 taxes free See Publication 530, Tax Information for Homeowners. File my 2011 taxes free Adoption credit. File my 2011 taxes free See the Instructions for Form 8839. File my 2011 taxes free Credit for nonrefundable portion of prior year minimum tax if you paid alternative minimum tax in an earlier year. File my 2011 taxes free See the Instructions for Form 8801. File my 2011 taxes free General business credit. File my 2011 taxes free See the Instructions for Form 3800. File my 2011 taxes free Earned income credit. File my 2011 taxes free See Publication 596. File my 2011 taxes free Figuring line 5 entry. File my 2011 taxes free   To figure the amount to add on line 5 for tax credits, multiply your estimated total credits by the appropriate number from Table 1-3 . File my 2011 taxes free Example. File my 2011 taxes free You are married and expect to file a joint return for 2014. File my 2011 taxes free Your combined estimated wages are $68,000. File my 2011 taxes free Your estimated tax credits include a child and dependent care credit of $960 and a mortgage interest credit of $1,700 (total credits = $2,660). File my 2011 taxes free In Table 1-3, the number corresponding to your combined estimated wages ($42,001 – $98,000) is 6. File my 2011 taxes free 7. File my 2011 taxes free Multiply your total estimated tax credits of $2,660 by 6. File my 2011 taxes free 7. File my 2011 taxes free Add the result, $17,822, to the amount you otherwise would show on line 5 of the Deductions and Adjustments Worksheet and enter the total on line 5. File my 2011 taxes free Because you choose to account for your child and dependent care credit this way, do not make an entry on line F of the Personal Allowances Worksheet. File my 2011 taxes free Nonwage income (worksheet line 6). File my 2011 taxes free   Enter on line 6 your estimated total nonwage income (other than tax-exempt income). File my 2011 taxes free Nonwage income includes interest, dividends, net rental income, unemployment compensation, alimony, gambling winnings, prizes and awards, hobby income, capital gains, royalties, and partnership income. File my 2011 taxes free   If line 6 is more than line 5, you may not have enough income tax withheld from your wages. File my 2011 taxes free See Getting the Right Amount of Tax Withheld , later. File my 2011 taxes free Net deductions and adjustments (worksheet line 8). File my 2011 taxes free    If line 7 is less than $3,950, enter “0” on line 8. File my 2011 taxes free If line 7 is $3,950 or more, divide it by $3,950, drop any fraction, and enter the result on line 8. File my 2011 taxes free Example. File my 2011 taxes free If line 7 is $5,200, $5,200 ÷ $3,950 = 1. File my 2011 taxes free 32. File my 2011 taxes free Drop the fraction (. File my 2011 taxes free 32) and enter “1” on line 8. File my 2011 taxes free Two-Earners/Multiple Jobs Worksheet Complete the Two-Earners/Multiple Jobs Worksheet on page 2 of Form W-4 if you have more than one job or are married and you and your spouse both work and the combined earnings from all jobs are more than $50,000 ($20,000 if married). File my 2011 taxes free Reducing your allowances (worksheet lines 1-3). File my 2011 taxes free   On line 1 of the worksheet, enter the number from line H of the Personal Allowances Worksheet (or line 10 of the Deductions and Adjustments Worksheet, if used). File my 2011 taxes free Using Table 1 in the Two-Earners/Multiple Jobs Worksheet, find the number listed beside the amount of your estimated wages for the year from your lowest paying job (or if lower and you are filing jointly, your spouse's job). File my 2011 taxes free Enter that number on line 2. File my 2011 taxes free However, if you are married filing jointly and estimated wages from the highest paying job are $65,000 or less, do not enter more than “3. File my 2011 taxes free ”    Table 1-3. File my 2011 taxes free Deductions and Adjustments Worksheet (Form W-4)—Line 5 a. File my 2011 taxes free  Married Filing Jointly or Qualifying Widow(er) If combined income from all sources is:   Multiply credits by: $0 – 42,000 10. File my 2011 taxes free 0 $42,001 – 98,000 6. File my 2011 taxes free 7 $98,001 – 180,000 4. File my 2011 taxes free 0 $180,001 – 270,000 3. File my 2011 taxes free 6 $270,001 – 440,000 3. File my 2011 taxes free 0 $440,001 – 490,000. File my 2011 taxes free . File my 2011 taxes free . File my 2011 taxes free . File my 2011 taxes free 2. File my 2011 taxes free 9 $490,001 and over 2. File my 2011 taxes free 5 b. File my 2011 taxes free  Single If combined income from all sources is:   Multiply credits by: $0 – 19,000 10. File my 2011 taxes free 0 $19,001 – 47,000 6. File my 2011 taxes free 7 $47,001 – 104,000 4. File my 2011 taxes free 0 $104,001 – 205,000 3. File my 2011 taxes free 6 $205,001 – 430,000 3. File my 2011 taxes free 0 $430,001 and over 2. File my 2011 taxes free 5 c. File my 2011 taxes free  Head of Household If combined income from all sources is:   Multiply credits by: $0 – 30,000 10. File my 2011 taxes free 0 $30,001 – 66,000 6. File my 2011 taxes free 7 $66,001 – 150,000 4. File my 2011 taxes free 0 $150,001 – 235,000 3. File my 2011 taxes free 6 $235,001 – 430,000 3. File my 2011 taxes free 0 $430,001 – 460,000 2. File my 2011 taxes free 9 $460,001 and over 2. File my 2011 taxes free 5 d. File my 2011 taxes free  Married Filing Separately   If combined income from all sources is:   Multiply credits by: $0 – 21,000 10. File my 2011 taxes free 0 $21,001 – 49,000 6. File my 2011 taxes free 7 $49,001 – 90,000 4. File my 2011 taxes free 0 $90,001 – 135,000 3. File my 2011 taxes free 6 $135,001 – 220,000 3. File my 2011 taxes free 0 $220,001 – 245,000 2. File my 2011 taxes free 9 $245,001 and over 2. File my 2011 taxes free 5   Subtract line 2 from line 1 and enter the result (but not less than zero) on line 3 and on Form W-4, line 5. File my 2011 taxes free If line 1 is more than or equal to line 2, do not use the rest of the worksheet. File my 2011 taxes free   If line 1 is less than line 2, enter “0” on Form W-4, line 5. File my 2011 taxes free Then complete lines 4 through 9 of the worksheet to figure the additional withholding needed to avoid underwithholding. File my 2011 taxes free Other amounts owed. File my 2011 taxes free   If you expect to owe amounts other than income tax, such as self-employment tax, include them on line 8. File my 2011 taxes free The total is the additional withholding needed for the year. File my 2011 taxes free Getting the Right Amount of Tax Withheld In most situations, the tax withheld from your pay will be close to the tax you figure on your return if you follow these two rules. File my 2011 taxes free You accurately complete all the Form W-4 worksheets that apply to you. File my 2011 taxes free You give your employer a new Form W-4 when changes occur. File my 2011 taxes free But because the worksheets and withholding methods do not account for all possible situations, you may not be getting the right amount withheld. File my 2011 taxes free This is most likely to happen in the following situations. File my 2011 taxes free You are married and both you and your spouse work. File my 2011 taxes free You have more than one job at a time. File my 2011 taxes free You have nonwage income, such as interest, dividends, alimony, unemployment compensation, or self-employment income. File my 2011 taxes free You will owe additional amounts with your return, such as self-employment tax. File my 2011 taxes free Your withholding is based on obsolete Form W-4 information for a substantial part of the year. File my 2011 taxes free Your earnings are more than $130,000 if you are single or $180,000 if you are married. File my 2011 taxes free You work only part of the year. File my 2011 taxes free You change the number of your withholding allowances during the year. File my 2011 taxes free You are subject to Additional Medicare Tax or Net Investment Income Tax. File my 2011 taxes free If you anticipate liability for Additional Medicare Tax or Net Investment Income Tax, you may request that your employer withhold an additional amount of income tax withholding on Form W-4. File my 2011 taxes free Part-Year Method If you work only part of the year and your employer agrees to use the part-year withholding method, less tax will be withheld from each wage payment than would be withheld if you worked all year. File my 2011 taxes free To be eligible for the part-year method, you must meet both of the following requirements. File my 2011 taxes free You must use the calendar year (the 12 months from January 1 through December 31) as your tax year. File my 2011 taxes free You cannot use a fiscal year. File my 2011 taxes free You must not expect to be employed for more than 245 days during the year. File my 2011 taxes free To figure this limit, count all calendar days that you are employed (including weekends, vacations, and sick days) beginning with the first day you are on the job for pay and ending with your last day of work. File my 2011 taxes free If you are temporarily laid off for 30 days or less, count those days too. File my 2011 taxes free If you are laid off for more than 30 days, do not count those days. File my 2011 taxes free You will not meet this requirement if you begin working before May 1 and expect to work for the rest of the year. File my 2011 taxes free How to apply for the part-year method. File my 2011 taxes free   You must ask your employer in writing to use this method. File my 2011 taxes free The request must state all three of the following. File my 2011 taxes free The date of your last day of work for any prior employer during the current calendar year. File my 2011 taxes free That you do not expect to be employed more than 245 days during the current calendar year. File my 2011 taxes free That you use the calendar year as your tax year. File my 2011 taxes free Cumulative Wage Method If you change the number of your withholding allowances during the year, too much or too little tax may have been withheld for the period before you made the change. File my 2011 taxes free You may be able to compensate for this if your employer agrees to use the cumulative wage withholding method for the rest of the year. File my 2011 taxes free You must ask your employer in writing to use this method. File my 2011 taxes free To be eligible, you must have been paid for the same kind of payroll period (weekly, biweekly, etc. File my 2011 taxes free ) since the beginning of the year. File my 2011 taxes free Aids for Figuring Your Withholding IRS Withholding Calculator. File my 2011 taxes free   If you had too much or too little income tax withheld from your pay, the IRS provides a withholding calculator on its website. File my 2011 taxes free Go to www. File my 2011 taxes free irs. File my 2011 taxes free gov/Individuals/IRS-Withholding-Calculator. File my 2011 taxes free It can help you determine the correct amount to be withheld any time during the year. File my 2011 taxes free Rules Your Employer Must Follow It may be helpful for you to know some of the withholding rules your employer must follow. File my 2011 taxes free These rules can affect how to fill out your Form W-4 and how to handle problems that may arise. File my 2011 taxes free New Form W-4. File my 2011 taxes free   When you start a new job, your employer should give you a Form W-4 to fill out. File my 2011 taxes free Beginning with your first payday, your employer will use the information you give on the form to figure your withholding. File my 2011 taxes free   If you later fill out a new Form W-4, your employer can put it into effect as soon as possible. File my 2011 taxes free The deadline for putting it into effect is the start of the first payroll period ending 30 or more days after you turn it in. File my 2011 taxes free No Form W-4. File my 2011 taxes free   If you do not give your employer a completed Form W-4, your employer must withhold at the highest rate, as if you were single and claimed no withholding allowances. File my 2011 taxes free Repaying withheld tax. File my 2011 taxes free   If you find you are having too much tax withheld because you did not claim all the withholding allowances you are entitled to, you should give your employer a new Form W-4. File my 2011 taxes free Your employer cannot repay any of the tax previously withheld. File my 2011 taxes free Instead, claim the full amount withheld when you file your tax return. File my 2011 taxes free   However, if your employer has withheld more than the correct amount of tax for the Form W-4 you have in effect, you do not have to fill out a new Form W-4 to have your withholding lowered to the correct amount. File my 2011 taxes free Your employer can repay the amount that was withheld incorrectly. File my 2011 taxes free If you are not repaid, your Form W-2 will reflect the full amount actually withheld, which you would claim when you file your tax return. File my 2011 taxes free IRS review of your withholding. File my 2011 taxes free   Whether you are entitled to claim a certain number of allowances or a complete exemption from withholding is subject to review by the IRS. File my 2011 taxes free Your employer may be required to send a copy of the Form W-4 to the IRS. File my 2011 taxes free There is a penalty for supplying false information on Form W-4. File my 2011 taxes free See Penalties , later. File my 2011 taxes free   If the IRS determines that you cannot claim more than a specified number of withholding allowances or claim a complete exemption from withholding, the IRS will issue a notice of the maximum number of withholding allowances permitted (commonly referred to as a “lock-in letter”) to both you and your employer. File my 2011 taxes free   The IRS will provide a period of time during which you can dispute the determination before your employer adjusts your withholding. File my 2011 taxes free If you believe that you are entitled to claim complete exemption from withholding or claim more withholding allowances than the maximum number specified by the IRS in the lock-in letter, you must submit a new Form W-4 and a written statement to support your claims to the IRS. File my 2011 taxes free Contact information (a toll-free number and an IRS office address) will be provided in the lock-in letter. File my 2011 taxes free At the end of this period, if you have not responded or if your response is not adequate, your employer will be required to withhold based on the original lock-in letter. File my 2011 taxes free   After the lock-in letter takes effect, your employer must withhold tax on the basis of the withholding rate (marital status) and maximum number of withholding allowances specified in that letter. File my 2011 taxes free   If you later believe that you are entitled to claim exemption from withholding or more allowances than the IRS determined, you can complete a new Form W-4 and a written statement to support the claims made on the Form W-4 and send them directly to the IRS address shown on the lock-in letter. File my 2011 taxes free Your employer must continue to figure your withholding on the basis of the number of allowances previously determined by the IRS until the IRS advises your employer otherwise. File my 2011 taxes free   At any time, either before or after the lock-in letter becomes effective, you may give your employer a new Form W-4 that does not claim complete exemption from withholding and results in more income tax withheld than specified in the lock-in letter. File my 2011 taxes free Your employer must then withhold tax based on this new Form W-4. File my 2011 taxes free   Additional information is available at IRS. File my 2011 taxes free gov. File my 2011 taxes free Enter “withholding compliance questions” in the search box. File my 2011 taxes free Exemption From Withholding If you claim exemption from withholding, your employer will not withhold federal income tax from your wages. File my 2011 taxes free The exemption applies only to income tax, not to social security or Medicare tax. File my 2011 taxes free You can claim exemption from withholding for 2014 only if both of the following situations apply. File my 2011 taxes free For 2013 you had a right to a refund of all federal income tax withheld because you had no tax liability. File my 2011 taxes free For 2014 you expect a refund of all federal income tax withheld because you expect to have no tax liability. File my 2011 taxes free Use Figure 1-A to help you decide whether you can claim exemption from withholding. File my 2011 taxes free Do not use Figure 1-A if you: Are 65 or older, Are blind, Will itemize deductions on your 2014 return, Will claim an exemption for a dependent on your 2014 return, or Will claim any tax credits on your 2014 return. File my 2011 taxes free These situations are discussed later. File my 2011 taxes free Students. File my 2011 taxes free   If you are a student, you are not automatically exempt. File my 2011 taxes free If you work only part time or during the summer, you may qualify for exemption from withholding. File my 2011 taxes free Example 1. File my 2011 taxes free You are a high school student and expect to earn $2,500 from a summer job. File my 2011 taxes free You do not expect to have any other income during the year, and your parents will be able to claim an exemption for you on their tax return. File my 2011 taxes free You worked last summer and had $375 federal income tax withheld from your pay. File my 2011 taxes free The entire $375 was refunded when you filed your 2013 return. File my 2011 taxes free Using Figure 1-A, you find that you can claim exemption from withholding. File my 2011 taxes free Please click here for the text description of the image. File my 2011 taxes free Figure 1-A: Exemption From Withholding on Form W-4 Example 2. File my 2011 taxes free The facts are the same as in Example 1, except that you also have a savings account and expect to have $400 interest income during the year. File my 2011 taxes free Using Figure 1-A, you find that you cannot claim exemption from withholding because your unearned income will be more than $350 and your total income will be more than $1,000. File my 2011 taxes free    You may have to file a tax return, even if you are exempt from withholding. File my 2011 taxes free See Publication 501 to see whether you must file a return. File my 2011 taxes free    Age 65 or older or blind. File my 2011 taxes free If you are 65 or older or blind, use Worksheet 1-3 or Worksheet 1-4, to help you decide whether you can claim exemption from withholding. File my 2011 taxes free Do not use either worksheet if you will itemize deductions, claim exemptions for dependents, or claim tax credits on your 2014 return. File my 2011 taxes free Instead, see Itemizing deductions or claiming exemptions or credits, next. File my 2011 taxes free Itemizing deductions or claiming exemptions or credits. File my 2011 taxes free   If you had no tax liability for 2013, and you will: Itemize deductions, Claim an exemption for a dependent, or Claim a tax credit, use the 2014 Estimated Tax Worksheet (also see chapter 2), to figure your 2014 expected tax liability. File my 2011 taxes free You can claim exemption from withholding only if your total expected tax liability (line 13c of the worksheet) is zero. File my 2011 taxes free Claiming exemption from withholding. File my 2011 taxes free   To claim exemption, you must give your employer a Form W-4. File my 2011 taxes free Do not complete lines 5 and 6. File my 2011 taxes free Enter “Exempt” on line 7. File my 2011 taxes free   If you claim exemption, but later your situation changes so that you will have to pay income tax after all, you must file a new Form W-4 within 10 days after the change. File my 2011 taxes free If you claim exemption in 2014 but you expect to owe income tax for 2015, you must file a new Form W-4 by December 1, 2014. File my 2011 taxes free   Your claim of exempt status may be reviewed by the IRS. File my 2011 taxes free See IRS review of your withholding , earlier. File my 2011 taxes free An exemption is good for only 1 year. File my 2011 taxes free   You must give your employer a new Form W-4 by February 15 each year to continue your exemption. File my 2011 taxes free Supplemental Wages Supplemental wages include bonuses, commissions, overtime pay, vacation allowances, certain sick pay, and expense allowances under certain plans. File my 2011 taxes free The payer can figure withholding on supplemental wages using the same method used for your regular wages. File my 2011 taxes free However, if these payments are identified separately from regular wages, your employer or other payer of supplemental wages can withhold income tax from these wages at a flat rate. File my 2011 taxes free Expense allowances. File my 2011 taxes free   Reimbursements or other expense allowances paid by your employer under a nonaccountable plan are treated as supplemental wages. File my 2011 taxes free A nonaccountable plan is a reimbursement arrangement that does not require you to account for, or prove, your business expenses to your employer or does not require you to return your employer's payments that are more than your proven expenses. File my 2011 taxes free   Reimbursements or other expense allowances paid under an accountable plan that are more than your proven expenses are treated as paid under a nonaccountable plan if you do not return the excess payments within a reasonable period of time. File my 2011 taxes free Accountable plan. File my 2011 taxes free   To be an accountable plan, your employer's reimbursement or allowance arrangement must include all three of the following rules. File my 2011 taxes free Your expenses must have a business connection. File my 2011 taxes free That is, you must have paid or incurred deductible expenses while performing services as an employee of your employer. File my 2011 taxes free You must adequately account to your employer for these expenses within a reasonable period of time. File my 2011 taxes free You must return any excess reimbursement or allowance within a reasonable period of time. File my 2011 taxes free    An excess reimbursement or allowance is any amount you are paid that is more than the business-related expenses that you adequately accounted for to your employer. File my 2011 taxes free   The definition of reasonable period of time depends on the facts and circumstances of your situation. File my 2011 taxes free However, regardless of those facts and circumstances, actions that take place within the times specified in the following list will be treated as taking place within a reasonable period of time. File my 2011 taxes free You receive an advance within 30 days of the time you have an expense. File my 2011 taxes free You adequately account for your expenses within 60 days after they were paid or incurred. File my 2011 taxes free You return any excess reimbursement within 120 days after the expense was paid or incurred. File my 2011 taxes free You are given a periodic statement (at least quarterly) that asks you to either return or adequately account for outstanding advances and you comply within 120 days of the statement. File my 2011 taxes free Nonaccountable plan. File my 2011 taxes free   Any plan that does not meet the definition of an accountable plan is considered a nonaccountable plan. File my 2011 taxes free For more information about accountable and nonaccountable plans, see chapter 6 of Publication 463, Travel, Entertainment, Gift, and Car Expenses. File my 2011 taxes free Penalties You may have to pay a penalty of $500 if both of the following apply. File my 2011 taxes free You make statements or claim withholding allowances on your Form W-4 that reduce the amount of tax withheld. File my 2011 taxes free You have no reasonable basis for those statements or allowances at the time you prepare your Form W-4. File my 2011 taxes free There is also a criminal penalty for willfully supplying false or fraudulent information on your Form W-4 or for willfully failing to supply information that would increase the amount withheld. File my 2011 taxes free The penalty upon conviction can be either a fine of up to $1,000 or imprisonment for up to 1 year, or both. File my 2011 taxes free These penalties will apply if you deliberately and knowingly falsify your Form W-4 in an attempt to reduce or eliminate the proper withholding of taxes. File my 2011 taxes free A simple error or an honest mistake will not result in one of these penalties. File my 2011 taxes free For example, a person who has tried to figure the number of withholding allowances correctly, but claims seven when the proper number is six, will not be charged a Form W-4 penalty. File my 2011 taxes free However, see chapter 4 for information on the penalty for underpaying your tax. File my 2011 taxes free Tips The tips you receive while working on your job are considered part of your pay. File my 2011 taxes free You must include your tips on your tax return on the same line as your regular pay. File my 2011 taxes free However, tax is not withheld directly from tip income, as it is from your regular pay. File my 2011 taxes free Nevertheless, your employer will take into account the tips you report when figuring how much to withhold from your regular pay. File my 2011 taxes free Reporting tips to your employer. File my 2011 taxes free   If you receive tips of $20 or more in a month while working for any one employer, you must report to your employer the total amount of tips you receive on the job during the month. File my 2011 taxes free The report is due by the 10th day of the following month. File my 2011 taxes free   If you have more than one job, make a separate report to each employer. File my 2011 taxes free Report only the tips you received while working for that employer, and only if they total $20 or more for the month. File my 2011 taxes free How employer figures amount to withhold. File my 2011 taxes free   The tips you report to your employer are counted as part of your income for the month you report them. File my 2011 taxes free Your employer can figure your withholding in either of two ways. File my 2011 taxes free By withholding at the regular rate on the sum of your pay plus your reported tips. File my 2011 taxes free By withholding at the regular rate on your pay plus a percentage of your reported tips. File my 2011 taxes free Not enough pay to cover taxes. File my 2011 taxes free   If your regular pay is not enough for your employer to withhold all the tax (including income tax and social security and Medicare taxes (or the equivalent railroad retirement tax)) due on your pay plus your tips, you can give your employer money to cover the shortage. File my 2011 taxes free   If you do not give your employer money to cover the shortage, your employer first withholds as much Medicare tax and social security or railroad retirement tax as possible, up to the proper amount, and then withholds income tax up to the full amount of your pay. File my 2011 taxes free If not enough tax is withheld, you may have to pay estimated tax. File my 2011 taxes free When you file your return, you also may have to pay any Medicare and social security tax or railroad retirement tax your employer could not withhold. File my 2011 taxes free Tips not reported to your employer. File my 2011 taxes free   On your tax return, you must report all the tips you receive during the year, even tips you do not report to your employer (this includes the value of any noncash tips you received, such as tickets, passes, or other items of value). File my 2011 taxes free Make sure you are having enough tax withheld, or are paying enough estimated tax (see chapter 2), to cover all your tip income. File my 2011 taxes free Allocated tips. File my 2011 taxes free   If you work in a large food or beverage establishment, your employer may have to report an allocated amount of tips on your Form W-2. File my 2011 taxes free   Your employer should not withhold income tax, Medicare tax, and social security or railroad retirement tax on the allocated amount. File my 2011 taxes free Withholding is based only on your pay plus your reported tips. File my 2011 taxes free Your employer should refund to you any incorrectly withheld tax. File my 2011 taxes free More information. File my 2011 taxes free   For more information on the reporting and withholding rules for tip income and on tip allocation, see Publi