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File Tax Return For 2012

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File Tax Return For 2012

File tax return for 2012 Publication 526 - Main Content Table of Contents Organizations That Qualify To Receive Deductible ContributionsTypes of Qualified Organizations Contributions You Can DeductContributions From Which You Benefit Expenses Paid for Student Living With You Out-of-Pocket Expenses in Giving Services Expenses of Whaling Captains Contributions You Cannot DeductContributions to Individuals Contributions to Nonqualified Organizations Contributions From Which You Benefit Value of Time or Services Personal Expenses Appraisal Fees Contributions to Donor-Advised Funds Partial Interest in Property Contributions of PropertyContributions Subject to Special Rules Determining Fair Market Value Giving Property That Has Decreased in Value Giving Property That Has Increased in Value Penalty When To DeductChecks. File tax return for 2012 Text message. File tax return for 2012 Credit card. File tax return for 2012 Pay-by-phone account. File tax return for 2012 Stock certificate. File tax return for 2012 Promissory note. File tax return for 2012 Option. File tax return for 2012 Borrowed funds. File tax return for 2012 Conditional gift. File tax return for 2012 Limits on Deductions50% Limit 30% Limit Special 30% Limit for Capital Gain Property 20% Limit Special 50% Limit for Qualified Conservation Contributions How To Figure Your Deduction When Limits Apply Records To KeepCash Contributions Noncash Contributions Out-of-Pocket Expenses How To ReportReporting expenses for student living with you. File tax return for 2012 Total deduction over $500. File tax return for 2012 Deduction over $5,000 for one item. File tax return for 2012 Vehicle donations. File tax return for 2012 Clothing and household items not in good used condition. File tax return for 2012 Easement on building in historic district. File tax return for 2012 Deduction over $500,000. File tax return for 2012 How To Get Tax HelpLow Income Taxpayer Clinics Organizations That Qualify To Receive Deductible Contributions You can deduct your contributions only if you make them to a qualified organization. File tax return for 2012 Most organizations, other than churches and governments, must apply to the IRS to become a qualified organization. File tax return for 2012 How to check whether an organization can receive deductible charitable contributions. File tax return for 2012   You can ask any organization whether it is a qualified organization, and most will be able to tell you. File tax return for 2012 Or go to IRS. File tax return for 2012 gov. File tax return for 2012 Click on “Tools” and then on “Exempt Organizations Select Check” (www. File tax return for 2012 irs. File tax return for 2012 gov/Charities-&-Non-Profits/Exempt-Organizations-Select-Check). File tax return for 2012 This online tool will enable you to search for qualified organizations. File tax return for 2012 You can also call the IRS to find out if an organization is qualified. File tax return for 2012 Call 1-877-829-5500. File tax return for 2012 People who are deaf, hard of hearing, or have a speech disability and who have access to TTY/TDD equipment can call 1-800-829-4059. File tax return for 2012 Deaf or hard of hearing individuals can also contact the IRS through relay services such as the Federal Relay Service at www. File tax return for 2012 gsa. File tax return for 2012 gov/fedrelay. File tax return for 2012 Types of Qualified Organizations Generally, only the following types of organizations can be qualified organizations. File tax return for 2012 A community chest, corporation, trust, fund, or foundation organized or created in or under the laws of the United States, any state, the District of Columbia, or any possession of the United States (including Puerto Rico). File tax return for 2012 It must, however, be organized and operated only for charitable, religious, scientific, literary, or educational purposes, or for the prevention of cruelty to children or animals. File tax return for 2012 Certain organizations that foster national or international amateur sports competition also qualify. File tax return for 2012 War veterans' organizations, including posts, auxiliaries, trusts, or foundations, organized in the United States or any of its possessions (including Puerto Rico). File tax return for 2012 Domestic fraternal societies, orders, and associations operating under the lodge system. File tax return for 2012 (Your contribution to this type of organization is deductible only if it is to be used solely for charitable, religious, scientific, literary, or educational purposes, or for the prevention of cruelty to children or animals. File tax return for 2012 ) Certain nonprofit cemetery companies or corporations. File tax return for 2012 (Your contribution to this type of organization is not deductible if it can be used for the care of a specific lot or mausoleum crypt. File tax return for 2012 ) The United States or any state, the District of Columbia, a U. File tax return for 2012 S. File tax return for 2012 possession (including Puerto Rico), a political subdivision of a state or U. File tax return for 2012 S. File tax return for 2012 possession, or an Indian tribal government or any of its subdivisions that perform substantial government functions. File tax return for 2012 (Your contribution to this type of organization is deductible only if it is to be used solely for public purposes. File tax return for 2012 ) Example 1. File tax return for 2012 You contribute cash to your city's police department to be used as a reward for information about a crime. File tax return for 2012 The city police department is a qualified organization, and your contribution is for a public purpose. File tax return for 2012 You can deduct your contribution. File tax return for 2012 Example 2. File tax return for 2012 You make a voluntary contribution to the social security trust fund, not earmarked for a specific account. File tax return for 2012 Because the trust fund is part of the U. File tax return for 2012 S. File tax return for 2012 Government, you contributed to a qualified organization. File tax return for 2012 You can deduct your contribution. File tax return for 2012 Examples. File tax return for 2012   The following list gives some examples of qualified organizations. File tax return for 2012 Churches, a convention or association of churches, temples, synagogues, mosques, and other religious organizations. File tax return for 2012 Most nonprofit charitable organizations such as the American Red Cross and the United Way. File tax return for 2012 Most nonprofit educational organizations, including the Boy Scouts of America, Girl Scouts of America, colleges, and museums. File tax return for 2012 This also includes nonprofit daycare centers that provide childcare to the general public if substantially all the childcare is provided to enable parents and guardians to be gainfully employed. File tax return for 2012 However, if your contribution is a substitute for tuition or other enrollment fee, it is not deductible as a charitable contribution, as explained later under Contributions You Cannot Deduct . File tax return for 2012 Nonprofit hospitals and medical research organizations. File tax return for 2012 Utility company emergency energy programs, if the utility company is an agent for a charitable organization that assists individuals with emergency energy needs. File tax return for 2012 Nonprofit volunteer fire companies. File tax return for 2012 Nonprofit organizations that develop and maintain public parks and recreation facilities. File tax return for 2012 Civil defense organizations. File tax return for 2012 Canadian charities. File tax return for 2012   You may be able to deduct contributions to certain Canadian charitable organizations covered under an income tax treaty with Canada. File tax return for 2012 To deduct your contribution to a Canadian charity, you generally must have income from sources in Canada. File tax return for 2012 See Publication 597, Information on the United States-Canada Income Tax Treaty, for information on how to figure your deduction. File tax return for 2012 Mexican charities. File tax return for 2012   Under the U. File tax return for 2012 S. File tax return for 2012 -Mexico income tax treaty, a contribution to a Mexican charitable organization may be deductible, but only if and to the extent the contribution would have been treated as a charitable contribution to a public charity created or organized under U. File tax return for 2012 S. File tax return for 2012 law. File tax return for 2012 To deduct your contribution to a Mexican charity, you must have income from sources in Mexico. File tax return for 2012 The limits described in Limits on Deductions , later, apply and are figured using your income from Mexican sources. File tax return for 2012 Israeli charities. File tax return for 2012   Under the U. File tax return for 2012 S. File tax return for 2012 -Israel income tax treaty, a contribution to an Israeli charitable organization is deductible if and to the extent the contribution would have been treated as a charitable contribution if the organization had been created or organized under U. File tax return for 2012 S. File tax return for 2012 law. File tax return for 2012 To deduct your contribution to an Israeli charity, you must have income from sources in Israel. File tax return for 2012 The limits described in Limits on Deductions , later, apply. File tax return for 2012 The deduction is also limited to 25% of your adjusted gross income from Israeli sources. File tax return for 2012 Contributions You Can Deduct Generally, you can deduct contributions of money or property you make to, or for the use of, a qualified organization. File tax return for 2012 A contribution is “for the use of” a qualified organization when it is held in a legally enforceable trust for the qualified organization or in a similar legal arrangement. File tax return for 2012 The contributions must be made to a qualified organization and not set aside for use by a specific person. File tax return for 2012 If you give property to a qualified organization, you generally can deduct the fair market value of the property at the time of the contribution. File tax return for 2012 See Contributions of Property , later. File tax return for 2012 Your deduction for charitable contributions generally cannot be more than 50% of your adjusted gross income (AGI), but in some cases 20% and 30% limits may apply. File tax return for 2012 In addition, the total of your charitable contributions deduction and certain other itemized deductions may be limited. File tax return for 2012 See Limits on Deductions , later. File tax return for 2012 Table 1 in this publication gives examples of contributions you can and cannot deduct. File tax return for 2012 Contributions From Which You Benefit If you receive a benefit as a result of making a contribution to a qualified organization, you can deduct only the amount of your contribution that is more than the value of the benefit you receive. File tax return for 2012 Also see Contributions From Which You Benefit under Contributions You Cannot Deduct, later. File tax return for 2012 If you pay more than fair market value to a qualified organization for goods or services, the excess may be a charitable contribution. File tax return for 2012 For the excess amount to qualify, you must pay it with the intent to make a charitable contribution. File tax return for 2012 Example 1. File tax return for 2012 You pay $65 for a ticket to a dinner-dance at a church. File tax return for 2012 Your entire $65 payment goes to the church. File tax return for 2012 The ticket to the dinner-dance has a fair market value of $25. File tax return for 2012 When you buy your ticket, you know its value is less than your payment. File tax return for 2012 To figure the amount of your charitable contribution, subtract the value of the benefit you receive ($25) from your total payment ($65). File tax return for 2012 You can deduct $40 as a charitable contribution to the church. File tax return for 2012 Example 2. File tax return for 2012 At a fundraising auction conducted by a charity, you pay $600 for a week's stay at a beach house. File tax return for 2012 The amount you pay is no more than the fair rental value. File tax return for 2012 You have not made a deductible charitable contribution. File tax return for 2012 Athletic events. File tax return for 2012   If you make a payment to, or for the benefit of, a college or university and, as a result, you receive the right to buy tickets to an athletic event in the athletic stadium of the college or university, you can deduct 80% of the payment as a charitable contribution. File tax return for 2012   If any part of your payment is for tickets (rather than the right to buy tickets), that part is not deductible. File tax return for 2012 Subtract the price of the tickets from your payment. File tax return for 2012 You can deduct 80% of the remaining amount as a charitable contribution. File tax return for 2012 Example 1. File tax return for 2012 You pay $300 a year for membership in a university's athletic scholarship program. File tax return for 2012 The only benefit of membership is that you have the right to buy one season ticket for a seat in a designated area of the stadium at the university's home football games. File tax return for 2012 You can deduct $240 (80% of $300) as a charitable contribution. File tax return for 2012 Example 2. File tax return for 2012 The facts are the same as in Example 1 except your $300 payment includes the purchase of one season ticket for the stated ticket price of $120. File tax return for 2012 You must subtract the usual price of a ticket ($120) from your $300 payment. File tax return for 2012 The result is $180. File tax return for 2012 Your deductible charitable contribution is $144 (80% of $180). File tax return for 2012 Charity benefit events. File tax return for 2012   If you pay a qualified organization more than fair market value for the right to attend a charity ball, banquet, show, sporting event, or other benefit event, you can deduct only the amount that is more than the value of the privileges or other benefits you receive. File tax return for 2012   If there is an established charge for the event, that charge is the value of your benefit. File tax return for 2012 If there is no established charge, the reasonable value of the right to attend the event is the value of your benefit. File tax return for 2012 Whether you use the tickets or other privileges has no effect on the amount you can deduct. File tax return for 2012 However, if you return the ticket to the qualified organization for resale, you can deduct the entire amount you paid for the ticket. File tax return for 2012    Even if the ticket or other evidence of payment indicates that the payment is a “contribution,” this does not mean you can deduct the entire amount. File tax return for 2012 If the ticket shows the price of admission and the amount of the contribution, you can deduct the contribution amount. File tax return for 2012 Example. File tax return for 2012 You pay $40 to see a special showing of a movie for the benefit of a qualified organization. File tax return for 2012 Printed on the ticket is “Contribution–$40. File tax return for 2012 ” If the regular price for the movie is $8, your contribution is $32 ($40 payment − $8 regular price). File tax return for 2012 Membership fees or dues. File tax return for 2012   You may be able to deduct membership fees or dues you pay to a qualified organization. File tax return for 2012 However, you can deduct only the amount that is more than the value of the benefits you receive. File tax return for 2012   You cannot deduct dues, fees, or assessments paid to country clubs and other social organizations. File tax return for 2012 They are not qualified organizations. File tax return for 2012 Certain membership benefits can be disregarded. File tax return for 2012   Both you and the organization can disregard the following membership benefits if you get them in return for an annual payment of $75 or less. File tax return for 2012 Any rights or privileges, other than those discussed under Athletic events , earlier, that you can use frequently while you are a member, such as: Free or discounted admission to the organization's facilities or events, Free or discounted parking, Preferred access to goods or services, and Discounts on the purchase of goods and services. File tax return for 2012 Admission, while you are a member, to events open only to members of the organization if the organization reasonably projects that the cost per person (excluding any allocated overhead) is not more than $10. File tax return for 2012 20. File tax return for 2012 Token items. File tax return for 2012   You do not have to reduce your contribution by the value of any benefit you receive if both of the following are true. File tax return for 2012 You receive only a small item or other benefit of token value. File tax return for 2012 The qualified organization correctly determines that the value of the item or benefit you received is not substantial and informs you that you can deduct your payment in full. File tax return for 2012 The organization determines whether the value of an item or benefit is substantial by using Revenue Procedures 90-12 and 92-49 and the inflation adjustment in Revenue Procedure 2012–41. File tax return for 2012 Written statement. File tax return for 2012   A qualified organization must give you a written statement if you make a payment of more than $75 that is partly a contribution and partly for goods or services. File tax return for 2012 The statement must say you can deduct only the amount of your payment that is more than the value of the goods or services you received. File tax return for 2012 It must also give you a good faith estimate of the value of those goods or services. File tax return for 2012   The organization can give you the statement either when it solicits or when it receives the payment from you. File tax return for 2012 Exception. File tax return for 2012   An organization will not have to give you this statement if one of the following is true. File tax return for 2012 The organization is: A governmental organization described in (5) under Types of Qualified Organizations , earlier, or An organization formed only for religious purposes, and the only benefit you receive is an intangible religious benefit (such as admission to a religious ceremony) that generally is not sold in commercial transactions outside the donative context. File tax return for 2012 You receive only items whose value is not substantial as described under Token items , earlier. File tax return for 2012 You receive only membership benefits that can be disregarded, as described under Membership fees or dues , earlier. File tax return for 2012 Expenses Paid for Student Living With You You may be able to deduct some expenses of having a student live with you. File tax return for 2012 You can deduct qualifying expenses for a foreign or American student who: Lives in your home under a written agreement between you and a qualified organization (defined later) as part of a program of the organization to provide educational opportunities for the student, Is not your relative (defined later) or dependent (also defined later), and Is a full-time student in the twelfth or any lower grade at a school in the United States. File tax return for 2012 You can deduct up to $50 a month for each full calendar month the student lives with you. File tax return for 2012 Any month when conditions (1) through (3) above are met for 15 or more days counts as a full month. File tax return for 2012 Qualified organization. File tax return for 2012   For these purposes, a qualified organization can be any of the organizations described earlier under Types of Qualified Organizations , except those in (4) and (5). File tax return for 2012 For example, if you are providing a home for a student as part of a state or local government program, you cannot deduct your expenses as charitable contributions. File tax return for 2012 But see Foster parents under Out-of-Pocket Expenses in Giving Services, later, if you provide the home as a foster parent. File tax return for 2012 Relative. File tax return for 2012   The term “relative” means any of the following persons. File tax return for 2012 Your child, stepchild, foster child, or a descendant of any of them (for example, your grandchild). File tax return for 2012 A legally adopted child is considered your child. File tax return for 2012 Your brother, sister, half brother, half sister, stepbrother, or stepsister. File tax return for 2012 Your father, mother, grandparent, or other direct ancestor. File tax return for 2012 Your stepfather or stepmother. File tax return for 2012 A son or daughter of your brother or sister. File tax return for 2012 A brother or sister of your father or mother. File tax return for 2012 Your son-in-law, daughter-in-law, father-in-law, mother-in-law, brother-in-law, or sister-in-law. File tax return for 2012 Dependent. File tax return for 2012   For this purpose, the term “dependent” means: A person you can claim as a dependent, or A person you could have claimed as a dependent except that: He or she received gross income of $3,900 or more, He or she filed a joint return, or You, or your spouse if filing jointly, could be claimed as a dependent on someone else's 2013 return. File tax return for 2012    Foreign students brought to this country under a qualified international education exchange program and placed in American homes for a temporary period generally are not U. File tax return for 2012 S. File tax return for 2012 residents and cannot be claimed as dependents. File tax return for 2012 Qualifying expenses. File tax return for 2012   You may be able to deduct the cost of books, tuition, food, clothing, transportation, medical and dental care, entertainment, and other amounts you actually spend for the well-being of the student. File tax return for 2012 Expenses that do not qualify. File tax return for 2012   You cannot deduct depreciation on your home, the fair market value of lodging, and similar items not considered amounts actually spent by you. File tax return for 2012 Nor can you deduct general household expenses, such as taxes, insurance, and repairs. File tax return for 2012 Reimbursed expenses. File tax return for 2012   In most cases, you cannot claim a charitable contribution deduction if you are compensated or reimbursed for any part of the costs of having a student live with you. File tax return for 2012 However, you may be able to claim a charitable contribution deduction for the unreimbursed portion of your expenses if you are reimbursed only for an extraordinary or one-time item, such as a hospital bill or vacation trip, you paid in advance at the request of the student's parents or the sponsoring organization. File tax return for 2012 Mutual exchange program. File tax return for 2012   You cannot deduct the costs of a foreign student living in your home under a mutual exchange program through which your child will live with a family in a foreign country. File tax return for 2012 Reporting expenses. File tax return for 2012   For a list of what you must file with your return if you deduct expenses for a student living with you, see Reporting expenses for student living with you under How To Report, later. File tax return for 2012 Out-of-Pocket Expenses in Giving Services Table 2. File tax return for 2012 Volunteers' Questions and Answers If you volunteer for a qualified organization, the following questions and answers may apply to you. File tax return for 2012 All of the rules explained in this publication also apply. File tax return for 2012 See, in particular, Out-of-Pocket Expenses in Giving Services . File tax return for 2012 Question Answer I volunteer 6 hours a week in the office of a qualified organization. File tax return for 2012 The receptionist is paid $10 an hour for the same work. File tax return for 2012 Can I deduct $60 a week for my time? No, you cannot deduct the value of your time or services. File tax return for 2012  The office is 30 miles from my home. File tax return for 2012 Can I deduct any of my car expenses for these trips? Yes, you can deduct the costs of gas and oil that are directly related to getting to and from the place where you volunteer. File tax return for 2012 If you do not want to figure your actual costs, you can deduct 14 cents for each mile. File tax return for 2012 I volunteer as a Red Cross nurse's aide at a hospital. File tax return for 2012 Can I deduct the cost of the uniforms I must wear? Yes, you can deduct the cost of buying and cleaning your uniforms if the hospital is a qualified organization, the uniforms are not suitable for everyday use, and you must wear them when volunteering. File tax return for 2012 I pay a babysitter to watch my children while I volunteer for a qualified organization. File tax return for 2012 Can I deduct these costs? No, you cannot deduct payments for childcare expenses as a charitable contribution, even if you would be unable to volunteer without childcare. File tax return for 2012 (If you have childcare expenses so you can work for pay, see Publication 503, Child and Dependent Care Expenses. File tax return for 2012 ) Although you cannot deduct the value of your services given to a qualified organization, you may be able to deduct some amounts you pay in giving services to a qualified organization. File tax return for 2012 The amounts must be: Unreimbursed, Directly connected with the services, Expenses you had only because of the services you gave, and Not personal, living, or family expenses. File tax return for 2012 Table 2 contains questions and answers that apply to some individuals who volunteer their services. File tax return for 2012 Underprivileged youths selected by charity. File tax return for 2012   You can deduct reasonable unreimbursed out-of-pocket expenses you pay to allow underprivileged youths to attend athletic events, movies, or dinners. File tax return for 2012 The youths must be selected by a charitable organization whose goal is to reduce juvenile delinquency. File tax return for 2012 Your own similar expenses in accompanying the youths are not deductible. File tax return for 2012 Conventions. File tax return for 2012   If a qualified organization selects you to attend a convention as its representative, you can deduct your unreimbursed expenses for travel, including reasonable amounts for meals and lodging, while away from home overnight for the convention. File tax return for 2012 However, see Travel , later. File tax return for 2012   You cannot deduct personal expenses for sightseeing, fishing parties, theater tickets, or nightclubs. File tax return for 2012 You also cannot deduct travel, meals and lodging, and other expenses for your spouse or children. File tax return for 2012   You cannot deduct your travel expenses in attending a church convention if you go only as a member of your church rather than as a chosen representative. File tax return for 2012 You can, however, deduct unreimbursed expenses that are directly connected with giving services for your church during the convention. File tax return for 2012 Uniforms. File tax return for 2012   You can deduct the cost and upkeep of uniforms that are not suitable for everyday use and that you must wear while performing donated services for a charitable organization. File tax return for 2012 Foster parents. File tax return for 2012   You may be able to deduct as a charitable contribution some of the costs of being a foster parent (foster care provider) if you have no profit motive in providing the foster care and are not, in fact, making a profit. File tax return for 2012 A qualified organization must select the individuals you take into your home for foster care. File tax return for 2012   You can deduct expenses that meet both of the following requirements. File tax return for 2012 They are unreimbursed out-of-pocket expenses to feed, clothe, and care for the foster child. File tax return for 2012 They are incurred primarily to benefit the qualified organization. File tax return for 2012   Unreimbursed expenses that you cannot deduct as charitable contributions may be considered support provided by you in determining whether you can claim the foster child as a dependent. File tax return for 2012 For details, see Publication 501, Exemptions, Standard Deduction, and Filing Information. File tax return for 2012 Example. File tax return for 2012 You cared for a foster child because you wanted to adopt her, not to benefit the agency that placed her in your home. File tax return for 2012 Your unreimbursed expenses are not deductible as charitable contributions. File tax return for 2012 Church deacon. File tax return for 2012   You can deduct as a charitable contribution any unreimbursed expenses you have while in a permanent diaconate program established by your church. File tax return for 2012 These expenses include the cost of vestments, books, and transportation required in order to serve in the program as either a deacon candidate or an ordained deacon. File tax return for 2012 Car expenses. File tax return for 2012   You can deduct as a charitable contribution any unreimbursed out-of-pocket expenses, such as the cost of gas and oil, directly related to the use of your car in giving services to a charitable organization. File tax return for 2012 You cannot deduct general repair and maintenance expenses, depreciation, registration fees, or the costs of tires or insurance. File tax return for 2012   If you do not want to deduct your actual expenses, you can use a standard mileage rate of 14 cents a mile to figure your contribution. File tax return for 2012   You can deduct parking fees and tolls whether you use your actual expenses or the standard mileage rate. File tax return for 2012   You must keep reliable written records of your car expenses. File tax return for 2012 For more information, see Car expenses under Records To Keep, later. File tax return for 2012 Travel. File tax return for 2012   Generally, you can claim a charitable contribution deduction for travel expenses necessarily incurred while you are away from home performing services for a charitable organization only if there is no significant element of personal pleasure, recreation, or vacation in the travel. File tax return for 2012 This applies whether you pay the expenses directly or indirectly. File tax return for 2012 You are paying the expenses indirectly if you make a payment to the charitable organization and the organization pays for your travel expenses. File tax return for 2012   The deduction for travel expenses will not be denied simply because you enjoy providing services to the charitable organization. File tax return for 2012 Even if you enjoy the trip, you can take a charitable contribution deduction for your travel expenses if you are on duty in a genuine and substantial sense throughout the trip. File tax return for 2012 However, if you have only nominal duties, or if for significant parts of the trip you do not have any duties, you cannot deduct your travel expenses. File tax return for 2012 Example 1. File tax return for 2012 You are a troop leader for a tax-exempt youth group and you take the group on a camping trip. File tax return for 2012 You are responsible for overseeing the setup of the camp and for providing adult supervision for other activities during the entire trip. File tax return for 2012 You participate in the activities of the group and enjoy your time with them. File tax return for 2012 You oversee the breaking of camp and you transport the group home. File tax return for 2012 You can deduct your travel expenses. File tax return for 2012 Example 2. File tax return for 2012 You sail from one island to another and spend 8 hours a day counting whales and other forms of marine life. File tax return for 2012 The project is sponsored by a charitable organization. File tax return for 2012 In most circumstances, you cannot deduct your expenses. File tax return for 2012 Example 3. File tax return for 2012 You work for several hours each morning on an archeological dig sponsored by a charitable organization. File tax return for 2012 The rest of the day is free for recreation and sightseeing. File tax return for 2012 You cannot take a charitable contribution deduction even though you work very hard during those few hours. File tax return for 2012 Example 4. File tax return for 2012 You spend the entire day attending a charitable organization's regional meeting as a chosen representative. File tax return for 2012 In the evening you go to the theater. File tax return for 2012 You can claim your travel expenses as charitable contributions, but you cannot claim the cost of your evening at the theater. File tax return for 2012 Daily allowance (per diem). File tax return for 2012   If you provide services for a charitable organization and receive a daily allowance to cover reasonable travel expenses, including meals and lodging while away from home overnight, you must include in income any part of the allowance that is more than your deductible travel expenses. File tax return for 2012 You may be able to deduct any necessary travel expenses that are more than the allowance. File tax return for 2012 Deductible travel expenses. File tax return for 2012   These include: Air, rail, and bus transportation, Out-of-pocket expenses for your car, Taxi fares or other costs of transportation between the airport or station and your hotel, Lodging costs, and The cost of meals. File tax return for 2012 Because these travel expenses are not business-related, they are not subject to the same limits as business related expenses. File tax return for 2012 For information on business travel expenses, see Travel in Publication 463, Travel, Entertainment, Gift, and Car Expenses. File tax return for 2012 Expenses of Whaling Captains You may be able to deduct as a charitable contribution any reasonable and necessary whaling expenses you pay during the year to carry out sanctioned whaling activities. File tax return for 2012 The deduction is limited to $10,000 a year. File tax return for 2012 To claim the deduction, you must be recognized by the Alaska Eskimo Whaling Commission as a whaling captain charged with the responsibility of maintaining and carrying out sanctioned whaling activities. File tax return for 2012 Sanctioned whaling activities are subsistence bowhead whale hunting activities conducted under the management plan of the Alaska Eskimo Whaling Commission. File tax return for 2012 Whaling expenses include expenses for: Acquiring and maintaining whaling boats, weapons, and gear used in sanctioned whaling activities, Supplying food for the crew and other provisions for carrying out these activities, and Storing and distributing the catch from these activities. File tax return for 2012 You must keep records showing the time, place, date, amount, and nature of the expenses. File tax return for 2012 For details, see Revenue Procedure 2006-50, which is on page 944 of Internal Revenue Bulletin 2006-47 at www. File tax return for 2012 irs. File tax return for 2012 gov/pub/irs-irbs/irb06-47. File tax return for 2012 pdf. File tax return for 2012 Contributions You Cannot Deduct There are some contributions you cannot deduct and others you can deduct only in part. File tax return for 2012 You cannot deduct as a charitable contribution: A contribution to a specific individual, A contribution to a nonqualified organization, The part of a contribution from which you receive or expect to receive a benefit, The value of your time or services, Your personal expenses, A qualified charitable distribution from an individual retirement arrangement (IRA), Appraisal fees, Certain contributions to donor-advised funds, or Certain contributions of partial interests in property. File tax return for 2012 Detailed discussions of these items follow. File tax return for 2012 Contributions to Individuals You cannot deduct contributions to specific individuals, including the following. File tax return for 2012 Contributions to fraternal societies made for the purpose of paying medical or burial expenses of members. File tax return for 2012 Contributions to individuals who are needy or worthy. File tax return for 2012 You cannot deduct these contributions even if you make them to a qualified organization for the benefit of a specific person. File tax return for 2012 But you can deduct a contribution to a qualified organization that helps needy or worthy individuals if you do not indicate that your contribution is for a specific person. File tax return for 2012 Example. File tax return for 2012 You can deduct contributions to a qualified organization for flood relief, hurricane relief, or other disaster relief. File tax return for 2012 However, you cannot deduct contributions earmarked for relief of a particular individual or family. File tax return for 2012 Payments to a member of the clergy that can be spent as he or she wishes, such as for personal expenses. File tax return for 2012 Expenses you paid for another person who provided services to a qualified organization. File tax return for 2012 Example. File tax return for 2012 Your son does missionary work. File tax return for 2012 You pay his expenses. File tax return for 2012 You cannot claim a deduction for your son's unreimbursed expenses related to his contribution of services. File tax return for 2012 Payments to a hospital that are for a specific patient's care or for services for a specific patient. File tax return for 2012 You cannot deduct these payments even if the hospital is operated by a city, state, or other qualified organization. File tax return for 2012 Contributions to Nonqualified Organizations You cannot deduct contributions to organizations that are not qualified to receive tax-deductible contributions, including the following. File tax return for 2012 Certain state bar associations if: The bar is not a political subdivision of a state, The bar has private, as well as public, purposes, such as promoting the professional interests of members, and Your contribution is unrestricted and can be used for private purposes. File tax return for 2012 Chambers of commerce and other business leagues or organizations. File tax return for 2012 Civic leagues and associations. File tax return for 2012 Communist organizations. File tax return for 2012 Country clubs and other social clubs. File tax return for 2012 Foreign organizations other than certain Canadian, Israeli, or Mexican charitable organizations. File tax return for 2012 (See Canadian charities , Mexican charities , and Israeli charities under Organizations That Qualify To Receive Deductible Contributions, earlier. File tax return for 2012 ) Also, you cannot deduct a contribution you made to any qualifying organization if the contribution is earmarked to go to a foreign organization. File tax return for 2012 However, certain contributions to a qualified organization for use in a program conducted by a foreign charity may be deductible as long as they are not earmarked to go to the foreign charity. File tax return for 2012 For the contribution to be deductible, the qualified organization must approve the program as furthering its own exempt purposes and must keep control over the use of the contributed funds. File tax return for 2012 The contribution is also deductible if the foreign charity is only an administrative arm of the qualified organization. File tax return for 2012 Homeowners' associations. File tax return for 2012 Labor unions. File tax return for 2012 But you may be able to deduct union dues as a miscellaneous itemized deduction, subject to the 2%-of-adjusted-gross-income limit, on Schedule A (Form 1040). File tax return for 2012 See Publication 529, Miscellaneous Deductions. File tax return for 2012 Political organizations and candidates. File tax return for 2012 Contributions From Which You Benefit If you receive or expect to receive a financial or economic benefit as a result of making a contribution to a qualified organization, you cannot deduct the part of the contribution that represents the value of the benefit you receive. File tax return for 2012 See Contributions From Which You Benefit under Contributions You Can Deduct, earlier. File tax return for 2012 These contributions include the following. File tax return for 2012 Contributions for lobbying. File tax return for 2012 This includes amounts you earmark for use in, or in connection with, influencing specific legislation. File tax return for 2012 Contributions to a retirement home for room, board, maintenance, or admittance. File tax return for 2012 Also, if the amount of your contribution depends on the type or size of apartment you will occupy, it is not a charitable contribution. File tax return for 2012 Costs of raffles, bingo, lottery, etc. File tax return for 2012 You cannot deduct as a charitable contribution amounts you pay to buy raffle or lottery tickets or to play bingo or other games of chance. File tax return for 2012 For information on how to report gambling winnings and losses, see Deductions Not Subject to the 2% Limit in Publication 529. File tax return for 2012 Dues to fraternal orders and similar groups. File tax return for 2012 However, see Membership fees or dues under Contributions From Which You Benefit, earlier. File tax return for 2012 Tuition, or amounts you pay instead of tuition. File tax return for 2012 You cannot deduct as a charitable contribution amounts you pay as tuition even if you pay them for children to attend parochial schools or qualifying nonprofit daycare centers. File tax return for 2012 You also cannot deduct any fixed amount you must pay in addition to, or instead of, tuition to enroll in a private school, even if it is designated as a “donation. File tax return for 2012 ” Contributions connected with split-dollar insurance arrangements. File tax return for 2012 You cannot deduct any part of a contribution to a charitable organization if, in connection with the contribution, the organization directly or indirectly pays, has paid, or is expected to pay any premium on any life insurance, annuity, or endowment contract for which you, any member of your family, or any other person chosen by you (other than a qualified charitable organization) is a beneficiary. File tax return for 2012 Example. File tax return for 2012 You donate money to a charitable organization. File tax return for 2012 The charity uses the money to purchase a cash value life insurance policy. File tax return for 2012 The beneficiaries under the insurance policy include members of your family. File tax return for 2012 Even though the charity may eventually get some benefit out of the insurance policy, you cannot deduct any part of the donation. File tax return for 2012 Qualified Charitable Distributions A qualified charitable distribution (QCD) is a distribution made directly by the trustee of your individual retirement arrangement (IRA), other than a SEP or SIMPLE IRA, to certain qualified organizations. File tax return for 2012 You must have been at least age 70½ when the distribution was made. File tax return for 2012 Your total QCDs for the year cannot be more than $100,000. File tax return for 2012 If all the requirements are met, a QCD is nontaxable, but you cannot claim a charitable contribution deduction for a QCD. File tax return for 2012 See Publication 590, Individual Retirement Arrangements (IRAs), for more information about QCDs. File tax return for 2012 Value of Time or Services You cannot deduct the value of your time or services, including: Blood donations to the American Red Cross or to blood banks, and The value of income lost while you work as an unpaid volunteer for a qualified organization. File tax return for 2012 Personal Expenses You cannot deduct personal, living, or family expenses, such as the following items. File tax return for 2012 The cost of meals you eat while you perform services for a qualified organization, unless it is necessary for you to be away from home overnight while performing the services. File tax return for 2012 Adoption expenses, including fees paid to an adoption agency and the costs of keeping a child in your home before adoption is final. File tax return for 2012 However, you may be able to claim a tax credit for these expenses. File tax return for 2012 Also, you may be able to exclude from your gross income amounts paid or reimbursed by your employer for your adoption expenses. File tax return for 2012 See Form 8839, Qualified Adoption Expenses, and its instructions, for more information. File tax return for 2012 You also may be able to claim an exemption for the child. File tax return for 2012 See Exemptions for Dependents in Publication 501 for more information. File tax return for 2012 Appraisal Fees You cannot deduct as a charitable contribution any fees you pay to find the fair market value of donated property. File tax return for 2012 But you can claim them, subject to the 2%-of-adjusted-gross-income limit, as a miscellaneous itemized deduction on Schedule A (Form 1040). File tax return for 2012 See Deductions Subject to the 2% Limit in Publication 529 for more information. File tax return for 2012 Contributions to Donor-Advised Funds You cannot deduct a contribution to a donor-advised fund if: The qualified organization that sponsors the fund is a war veterans' organization, a fraternal society, or a nonprofit cemetery company, or You do not have an acknowledgment from that sponsoring organization that it has exclusive legal control over the assets contributed. File tax return for 2012 There are also other circumstances in which you cannot deduct your contribution to a donor-advised fund. File tax return for 2012 Generally, a donor-advised fund is a fund or account in which a donor can, because of being a donor, advise the fund how to distribute or invest amounts held in the fund. File tax return for 2012 For details, see Internal Revenue Code section 170(f)(18). File tax return for 2012 Partial Interest in Property Generally, you cannot deduct a contribution of less than your entire interest in property. File tax return for 2012 For details, see Partial Interest in Property under Contributions of Property, later. File tax return for 2012 Contributions of Property If you contribute property to a qualified organization, the amount of your charitable contribution is generally the fair market value of the property at the time of the contribution. File tax return for 2012 However, if the property has increased in value, you may have to make some adjustments to the amount of your deduction. File tax return for 2012 See Giving Property That Has Increased in Value , later. File tax return for 2012 For information about the records you must keep and the information you must furnish with your return if you donate property, see Records To Keep and How To Report , later. File tax return for 2012 Contributions Subject to Special Rules Special rules apply if you contribute: Clothing or household items, A car, boat, or airplane, Taxidermy property, Property subject to a debt, A partial interest in property, A fractional interest in tangible personal property, A qualified conservation contribution, A future interest in tangible personal property, Inventory from your business, or A patent or other intellectual property. File tax return for 2012 These special rules are described next. File tax return for 2012 Clothing and Household Items You cannot take a deduction for clothing or household items you donate unless the clothing or household items are in good used condition or better. File tax return for 2012 Exception. File tax return for 2012   You can take a deduction for a contribution of an item of clothing or a household item that is not in good used condition or better if you deduct more than $500 for it and include a qualified appraisal of it with your return. File tax return for 2012 Household items. File tax return for 2012   Household items include: Furniture and furnishings, Electronics, Appliances, Linens, and Other similar items. File tax return for 2012   Household items do not include: Food, Paintings, antiques, and other objects of art, Jewelry and gems, and Collections. File tax return for 2012 Fair market value. File tax return for 2012   To determine the fair market value of these items, use the rules under Determining Fair Market Value , later. File tax return for 2012 Cars, Boats, and Airplanes The following rules apply to any donation of a qualified vehicle. File tax return for 2012 A qualified vehicle is: A car or any motor vehicle manufactured mainly for use on public streets, roads, and highways, A boat, or An airplane. File tax return for 2012 Deduction more than $500. File tax return for 2012   If you donate a qualified vehicle with a claimed fair market value of more than $500, you can deduct the smaller of: The gross proceeds from the sale of the vehicle by the organization, or The vehicle's fair market value on the date of the contribution. File tax return for 2012 If the vehicle's fair market value was more than your cost or other basis, you may have to reduce the fair market value to figure the deductible amount, as described under Giving Property That Has Increased in Value , later. File tax return for 2012 Form 1098-C. File tax return for 2012   You must attach to your return Copy B of the Form 1098-C, Contributions of Motor Vehicles, Boats, and Airplanes, (or other statement containing the same information as Form 1098-C) you received from the organization. File tax return for 2012 The Form 1098-C (or other statement) will show the gross proceeds from the sale of the vehicle. File tax return for 2012   If you e-file your return, you must: Attach Copy B of Form 1098-C to Form 8453, U. File tax return for 2012 S. File tax return for 2012 Individual Income Tax Transmittal for an IRS e-file Return, and mail the forms to the IRS, or Include Copy B of Form 1098-C as a pdf attachment if your software program allows it. File tax return for 2012   If you do not attach Form 1098-C (or other statement), you cannot deduct your contribution. File tax return for 2012    You must get Form 1098-C (or other statement) within 30 days of the sale of the vehicle. File tax return for 2012 But if exception 1 or 2 (described later) applies, you must get Form 1098-C (or other statement) within 30 days of your donation. File tax return for 2012 Filing deadline approaching and still no Form 1098-C. File tax return for 2012   If the filing deadline is approaching and you still do not have a Form 1098-C, you have two choices. File tax return for 2012 Request an automatic 6-month extension of time to file your return. File tax return for 2012 You can get this extension by filing Form 4868, Application for Automatic Extension of Time To File U. File tax return for 2012 S. File tax return for 2012 Individual Income Tax Return. File tax return for 2012 For more information, see the instructions for Form 4868. File tax return for 2012 File the return on time without claiming the deduction for the qualified vehicle. File tax return for 2012 After receiving the Form 1098-C, file an amended return, Form 1040X, Amended U. File tax return for 2012 S. File tax return for 2012 Individual Income Tax Return, claiming the deduction. File tax return for 2012 Attach Copy B of Form 1098-C (or other statement) to the amended return. File tax return for 2012 Exceptions. File tax return for 2012   There are two exceptions to the rules just described for deductions of more than $500. File tax return for 2012 Exception 1—vehicle used or improved by organization. File tax return for 2012   If the qualified organization makes a significant intervening use of or material improvement to the vehicle before transferring it, you generally can deduct the vehicle's fair market value at the time of the contribution. File tax return for 2012 But if the vehicle's fair market value was more than your cost or other basis, you may have to reduce the fair market value to get the deductible amount, as described under Giving Property That Has Increased in Value , later. File tax return for 2012 The Form 1098-C (or other statement) will show whether this exception applies. File tax return for 2012    Exception 2—vehicle given or sold to needy individual. File tax return for 2012   If the qualified organization will give the vehicle, or sell it for a price well below fair market value, to a needy individual to further the organization's charitable purpose, you generally can deduct the vehicle's fair market value at the time of the contribution. File tax return for 2012 But if the vehicle's fair market value was more than your cost or other basis, you may have to reduce the fair market value to get the deductible amount, as described under Giving Property That Has Increased in Value , later. File tax return for 2012 The Form 1098-C (or other statement) will show whether this exception applies. File tax return for 2012   This exception does not apply if the organization sells the vehicle at auction. File tax return for 2012 In that case, you cannot deduct the vehicle's fair market value. File tax return for 2012 Example. File tax return for 2012 Anita donates a used car to a qualified organization. File tax return for 2012 She bought it 3 years ago for $9,000. File tax return for 2012 A used car guide shows the fair market value for this type of car is $6,000. File tax return for 2012 However, Anita gets a Form 1098-C from the organization showing the car was sold for $2,900. File tax return for 2012 Neither exception 1 nor exception 2 applies. File tax return for 2012 If Anita itemizes her deductions, she can deduct $2,900 for her donation. File tax return for 2012 She must attach Form 1098-C and Form 8283 to her return. File tax return for 2012 Deduction $500 or less. File tax return for 2012   If the qualified organization sells the vehicle for $500 or less and exceptions 1 and 2 do not apply, you can deduct the smaller of: $500, or The vehicle's fair market value on the date of the contribution. File tax return for 2012 But if the vehicle's fair market value was more than your cost or other basis, you may have to reduce the fair market value to get the deductible amount, as described under Giving Property That Has Increased in Value , later. File tax return for 2012   If the vehicle's fair market value is at least $250 but not more than $500, you must have a written statement from the qualified organization acknowledging your donation. File tax return for 2012 The statement must contain the information and meet the tests for an acknowledgment described under Contributions of $250 or More under Records To Keep, later. File tax return for 2012 Fair market value. File tax return for 2012   To determine a vehicle's fair market value, use the rules described under Determining Fair Market Value , later. File tax return for 2012 Donations of inventory. File tax return for 2012   The vehicle donation rules just described do not apply to donations of inventory. File tax return for 2012 For example, these rules do not apply if you are a car dealer who donates a car you had been holding for sale to customers. File tax return for 2012 See Inventory , later. File tax return for 2012 Taxidermy Property If you donate taxidermy property to a qualified organization, your deduction is limited to your basis in the property or its fair market value, whichever is less. File tax return for 2012 This applies if you prepared, stuffed, or mounted the property or paid or incurred the cost of preparing, stuffing, or mounting the property. File tax return for 2012 Your basis for this purpose includes only the cost of preparing, stuffing, and mounting the property. File tax return for 2012 Your basis does not include transportation or travel costs. File tax return for 2012 It also does not include the direct or indirect costs for hunting or killing an animal, such as equipment costs. File tax return for 2012 In addition, it does not include the value of your time. File tax return for 2012 Taxidermy property means any work of art that: Is the reproduction or preservation of an animal, in whole or in part, Is prepared, stuffed, or mounted to recreate one or more characteristics of the animal, and Contains a part of the body of the dead animal. File tax return for 2012 Property Subject to a Debt If you contribute property subject to a debt (such as a mortgage), you must reduce the fair market value of the property by: Any allowable deduction for interest you paid (or will pay) that is attributable to any period after the contribution, and If the property is a bond, the lesser of: Any allowable deduction for interest you paid (or will pay) to buy or carry the bond that is attributable to any period before the contribution, or The interest, including bond discount, receivable on the bond that is attributable to any period before the contribution, and that is not includible in your income due to your accounting method. File tax return for 2012 This prevents you from deducting the same amount as both investment interest and a charitable contribution. File tax return for 2012 If the recipient (or another person) assumes the debt, you must also reduce the fair market value of the property by the amount of the outstanding debt assumed. File tax return for 2012 The amount of the debt is also treated as an amount realized on the sale or exchange of property for purposes of figuring your taxable gain (if any). File tax return for 2012 For more information, see Bargain Sales under Giving Property That Has Increased in Value, later. File tax return for 2012 Partial Interest in Property Generally, you cannot deduct a charitable contribution of less than your entire interest in property. File tax return for 2012 Right to use property. File tax return for 2012   A contribution of the right to use property is a contribution of less than your entire interest in that property and is not deductible. File tax return for 2012 Example 1. File tax return for 2012 You own a 10-story office building and donate rent-free use of the top floor to a charitable organization. File tax return for 2012 Because you still own the building, you have contributed a partial interest in the property and cannot take a deduction for the contribution. File tax return for 2012 Example 2. File tax return for 2012 Mandy White owns a vacation home at the beach that she sometimes rents to others. File tax return for 2012 For a fund-raising auction at her church, she donated the right to use the vacation home for 1 week. File tax return for 2012 At the auction, the church received and accepted a bid from Lauren Green equal to the fair rental value of the home for 1 week. File tax return for 2012 Mandy cannot claim a deduction because of the partial interest rule. File tax return for 2012 Lauren cannot claim a deduction either, because she received a benefit equal to the amount of her payment. File tax return for 2012 See Contributions From Which You Benefit , earlier. File tax return for 2012 Exceptions. File tax return for 2012   You can deduct a charitable contribution of a partial interest in property only if that interest represents one of the following items. File tax return for 2012 A remainder interest in your personal home or farm. File tax return for 2012 A remainder interest is one that passes to a beneficiary after the end of an earlier interest in the property. File tax return for 2012 Example. File tax return for 2012 You keep the right to live in your home during your lifetime and give your church a remainder interest that begins upon your death. File tax return for 2012 You can deduct the value of the remainder interest. File tax return for 2012 An undivided part of your entire interest. File tax return for 2012 This must consist of a part of every substantial interest or right you own in the property and must last as long as your interest in the property lasts. File tax return for 2012 But see Fractional Interest in Tangible Personal Property , later. File tax return for 2012 Example. File tax return for 2012 You contribute voting stock to a qualified organization but keep the right to vote the stock. File tax return for 2012 The right to vote is a substantial right in the stock. File tax return for 2012 You have not contributed an undivided part of your entire interest and cannot deduct your contribution. File tax return for 2012 A partial interest that would be deductible if transferred to certain types of trusts. File tax return for 2012 A qualified conservation contribution (defined later). File tax return for 2012 For information about how to figure the value of a contribution of a partial interest in property, see Partial Interest in Property Not in Trust in Publication 561. File tax return for 2012 Fractional Interest in Tangible Personal Property You cannot deduct a charitable contribution of a fractional interest in tangible personal property unless all interests in the property are held immediately before the contribution by: You, or You and the qualifying organization receiving the contribution. File tax return for 2012 If you make an additional contribution later, the fair market value of that contribution will be determined by using the smaller of: The fair market value of the property at the time of the initial contribution, or The fair market value of the property at the time of the additional contribution. File tax return for 2012 Tangible personal property is defined later under Future Interest in Tangible Personal Property . File tax return for 2012 A fractional interest in property is an undivided portion of your entire interest in the property. File tax return for 2012 Example. File tax return for 2012 An undivided one-quarter interest in a painting that entitles an art museum to possession of the painting for 3 months of each year is a fractional interest in the property. File tax return for 2012 Recapture of deduction. File tax return for 2012   You must recapture your charitable contribution deduction by including it in your income if both of the following statements are true. File tax return for 2012 You contributed a fractional interest in tangible personal property after August 17, 2006. File tax return for 2012 You do not contribute the rest of your interests in the property to the original recipient or, if it no longer exists, another qualified organization on or before the earlier of: The date that is 10 years after the date of the initial contribution, or The date of your death. File tax return for 2012   Recapture is also required if the qualified organization has not taken substantial physical possession of the property and used it in a way related to the organization's purpose during the period beginning on the date of the initial contribution and ending on the earlier of: The date that is 10 years after the date of the initial contribution, or The date of your death. File tax return for 2012 Additional tax. File tax return for 2012   If you must recapture your deduction, you must also pay interest and an additional tax equal to 10% of the amount recaptured. File tax return for 2012 Qualified Conservation Contribution A qualified conservation contribution is a contribution of a qualified real property interest to a qualified organization to be used only for conservation purposes. File tax return for 2012 Qualified organization. File tax return for 2012   For purposes of a qualified conservation contribution, a qualified organization is: A governmental unit, A publicly supported charity, or An organization controlled by, and operated for the exclusive benefit of, a governmental unit or a publicly supported charity. File tax return for 2012 The organization also must have a commitment to protect the conservation purposes of the donation and must have the resources to enforce the restrictions. File tax return for 2012   A publicly supported charity is an organization of the type described in (1) under Types of Qualified Organizations , earlier, that normally receives a substantial part of its support, other than income from its exempt activities, from direct or indirect contributions from the general public or from governmental units. File tax return for 2012 Qualified real property interest. File tax return for 2012   This is any of the following interests in real property. File tax return for 2012 Your entire interest in real estate other than a mineral interest (subsurface oil, gas, or other minerals, and the right of access to these minerals). File tax return for 2012 A remainder interest. File tax return for 2012 A restriction (granted in perpetuity) on the use that may be made of the real property. File tax return for 2012 Conservation purposes. File tax return for 2012   Your contribution must be made only for one of the following conservation purposes. File tax return for 2012 Preserving land areas for outdoor recreation by, or for the education of, the general public. File tax return for 2012 Protecting a relatively natural habitat of fish, wildlife, or plants, or a similar ecosystem. File tax return for 2012 Preserving open space, including farmland and forest land, if it yields a significant public benefit. File tax return for 2012 The open space must be preserved either for the scenic enjoyment of the general public or under a clearly defined federal, state, or local governmental conservation policy. File tax return for 2012 Preserving a historically important land area or a certified historic structure. File tax return for 2012 Building in registered historic district. File tax return for 2012   If a building in a registered historic district is a certified historic structure, a contribution of a qualified real property interest that is an easement or other restriction on the exterior of the building is deductible only if it meets all of the following conditions. File tax return for 2012 The restriction must preserve the entire exterior of the building (including its front, sides, rear, and height) and must prohibit any change to the exterior of the building that is inconsistent with its historical character. File tax return for 2012 You and the organization receiving the contribution must enter into a written agreement certifying, under penalty of perjury, that the organization: Is a qualified organization with a purpose of environmental protection, land conservation, open space preservation, or historic preservation, and Has the resources to manage and enforce the restriction and a commitment to do so. File tax return for 2012 You must include with your return: A qualified appraisal, Photographs of the building's entire exterior, and A description of all restrictions on development of the building, such as zoning laws and restrictive covenants. File tax return for 2012   If you claimed the rehabilitation credit for the building for any of the 5 years before the year of the contribution, your charitable deduction is reduced. File tax return for 2012 For more information, see Form 3468, Investment Credit, and Internal Revenue Code section 170(f)(14). File tax return for 2012   If you claim a deduction of more than $10,000, your deduction will not be allowed unless you pay a $500 filing fee. File tax return for 2012 See Form 8283-V, Payment Voucher for Filing Fee Under Section 170(f)(13), and its instructions. File tax return for 2012 You may be able to deduct the filing fee as a miscellaneous itemized deduction, subject to the 2%-of-adjusted-gross-income limit, on Schedule A (Form 1040). File tax return for 2012 See Deductions Subject to the 2% Limit in Publication 529 for more information. File tax return for 2012 More information. File tax return for 2012   For information about determining the fair market value of qualified conservation contributions, see Publication 561. File tax return for 2012 For information about the limits that apply to deductions for this type of contribution, see Limits on Deductions , later. File tax return for 2012 For more information about qualified conservation contributions, see Regulations section 1. File tax return for 2012 170A-14. File tax return for 2012 Future Interest in Tangible Personal Property You cannot deduct the value of a charitable contribution of a future interest in tangible personal property until all intervening interests in and rights to the actual possession or enjoyment of the property have either expired or been turned over to someone other than yourself, a related person, or a related organization. File tax return for 2012 But see Fractional Interest in Tangible Personal Property , earlier, and Tangible personal property put to unrelated use , later. File tax return for 2012 Related persons include your spouse, children, grandchildren, brothers, sisters, and parents. File tax return for 2012 Related organizations may include a partnership or corporation in which you have an interest, or an estate or trust with which you have a connection. File tax return for 2012 Tangible personal property. File tax return for 2012   This is any property, other than land or buildings, that can be seen or touched. File tax return for 2012 It includes furniture, books, jewelry, paintings, and cars. File tax return for 2012 Future interest. File tax return for 2012   This is any interest that is to begin at some future time, regardless of whether it is designated as a future interest under state law. File tax return for 2012 Example. File tax return for 2012 You own an antique car that you contribute to a museum. File tax return for 2012 You give up ownership, but retain the right to keep the car in your garage with your personal collection. File tax return for 2012 Because you keep an interest in the property, you cannot deduct the contribution. File tax return for 2012 If you turn the car over to the museum in a later year, giving up all rights to its use, possession, and enjoyment, you can take a deduction for the contribution in that later year. File tax return for 2012 Inventory If you contribute inventory (property you sell in the course of your business), the amount you can deduct is the smaller of its fair market value on the day you contributed it or its basis. File tax return for 2012 The basis of contributed inventory is any cost incurred for the inventory in an earlier year that you would otherwise include in your opening inventory for the year of the contribution. File tax return for 2012 You must remove the amount of your charitable contribution deduction from your opening inventory. File tax return for 2012 It is not part of the cost of goods sold. File tax return for 2012 If the cost of donated inventory is not included in your opening inventory, the inventory's basis is zero and you cannot claim a charitable contribution deduction. File tax return for 2012 Treat the inventory's cost as you would ordinarily treat it under your method of accounting. File tax return for 2012 For example, include the purchase price of inventory bought and donated in the same year in the cost of goods sold for that year. File tax return for 2012 A special rule applies to certain donations of food inventory. File tax return for 2012 See Food Inventory, later. File tax return for 2012 Patents and Other Intellectual Property If you donate intellectual property to a qualified organization, your deduction is limited to the basis of the property or the fair market value of the property, whichever is smaller. File tax return for 2012 Intellectual property means any of the following: Patents. File tax return for 2012 Copyrights (other than a copyright described in Internal Revenue Code sections 1221(a)(3) or 1231(b)(1)(C)). File tax return for 2012 Trademarks. File tax return for 2012 Trade names. File tax return for 2012 Trade secrets. File tax return for 2012 Know-how. File tax return for 2012 Software (other than software described in Internal Revenue Code section 197(e)(3)(A)(i)). File tax return for 2012 Other similar property or applications or registrations of such property. File tax return for 2012 Additional deduction based on income. File tax return for 2012   You may be able to claim additional charitable contribution deductions in the year of the contribution and years following, based on the income, if any, from the donated property. File tax return for 2012   The following table shows the percentage of income from the property that you can deduct for each of your tax years ending on or after the date of the contribution. File tax return for 2012 In the table, “tax year 1,” for example, means your first tax year ending on or after the date of the contribution. File tax return for 2012 However, you can take the additional deduction only to the extent the total of the amounts figured using this table is more than the amount of the deduction claimed for the original donation of the property. File tax return for 2012   After the legal life of the intellectual property ends, or after the 10th anniversary of the donation, whichever is earlier, no additional deduction is allowed. File tax return for 2012 The additional deductions cannot be taken for intellectual property donated to certain private foundations. File tax return for 2012 Tax year Deductible percentage 1 100% 2 100% 3 90% 4 80% 5 70% 6 60% 7 50% 8 40% 9 30% 10 20% 11 10% 12 10% Reporting requirements. File tax return for 2012   You must inform the organization at the time of the donation that you intend to treat the donation as a contribution subject to the provisions just discussed. File tax return for 2012   The organization is required to file an information return showing the income from the property, with a copy to you. File tax return for 2012 This is done on Form 8899, Notice of Income From Donated Intellectual Property. File tax return for 2012 Determining Fair Market Value This section discusses general guidelines for determining the fair market value of various types of donated property. File tax return for 2012 Publication 561 contains a more complete discussion. File tax return for 2012 Fair market value is the price at which property would change hands between a willing buyer and a willing seller, neither having to buy or sell, and both having reasonable knowledge of all the relevant facts. File tax return for 2012 Used clothing. File tax return for 2012   The fair market value of used clothing and other personal items is usually far less than the price you paid for them. File tax return for 2012 There are no fixed formulas or methods for finding the value of items of clothing. File tax return for 2012   You should claim as the value the price that buyers of used items actually pay in used clothing stores, such as consignment or thrift shops. File tax return for 2012      Also see Clothing and Household Items , earlier. File tax return for 2012 Example. File tax return for 2012    Kristin donated a coat to a thrift store operated by her church. File tax return for 2012 She paid $300 for the coat 3 years ago. File tax return for 2012 Similar coats in the thrift store sell for $50. File tax return for 2012 The fair market value of the coat is $50. File tax return for 2012 Kristin's donation is limited to $50. File tax return for 2012 Household items. File tax return for 2012   The fair market value of used household items, such as furniture, appliances, and linens, is usually much lower than the price paid when new. File tax return for 2012 These items may have little or no market value because they are in a worn condition, out of style, or no longer useful. File tax return for 2012 For these reasons, formulas (such as using a percentage of the cost to buy a new replacement item) are not acceptable in determining value. File tax return for 2012   You should support your valuation with photographs, canceled checks, receipts from your purchase of the items, or other evidence. File tax return for 2012 Magazine or newspaper articles and photographs that describe the items and statements by the recipients of the items are also useful. File tax return for 2012 Do not include any of this evidence with your tax return. File tax return for 2012   If the property is valuable because it is old or unique, see the discussion under Paintings, Antiques, and Other Objects of Art in Publication 561. File tax return for 2012   Also see Clothing and Household Items , earlier. File tax return for 2012 Cars, boats, and airplanes. File tax return for 2012   If you contribute a car, boat, or airplane to a charitable organization, you must determine its fair market value. File tax return for 2012 Boats. File tax return for 2012   Except for small, inexpensive boats, the valuation of boats should be based on an appraisal by a marine surveyor or appraiser because the physical condition is critical to the value. File tax return for 2012 Cars. File tax return for 2012   Certain commercial firms and trade organizations publish used car pricing guides, commonly called “blue books,” containing complete dealer sale prices or dealer average prices for recent model years. File tax return for 2012 The guides may be published monthly or seasonally, and for different regions of the country. File tax return for 2012 These guides also provide estimates for adjusting for unusual equipment, unusual mileage, and physical condition. File tax return for 2012 The prices are not “official” and these publications are not considered an appraisal of any specific donated property. File tax return for 2012 But they do provide clues for making an appraisal and suggest relative prices for comparison with current sales and offerings in your area. File tax return for 2012   These publications are sometimes available from public libraries, or from the loan officer at a bank, credit union, or finance company. File tax return for 2012 You can also find used car pricing information on the Internet. File tax return for 2012   To find the fair market value of a donated car, use the price listed in a used car guide for a private party sale, not the dealer retail value. File tax return for 2012 However, the fair market value may be less if the car has engine trouble, body damage, high mileage, or any type of excessive wear. File tax return for 2012 The fair market value of a donated car is the same as the price listed in a used car guide for a private party sale only if the guide lists a sales price for a car that is the same make, model, and year, sold in the same area, in the same condition, with the same or similar options or accessories, and with the same or similar warranties as the donated car. File tax return for 2012 Example. File tax return for 2012 You donate a used car in poor condition to a local high school for use by students studying car repair. File tax return for 2012 A used car guide shows the dealer retail value for this type of car in poor condition is $1,600. File tax return for 2012 However, the guide shows the price for a private party sale of the car is only $750. File tax return for 2012 The fair market value of the car is considered to be $750. File tax return for 2012 Large quantities. File tax return for 2012   If you contribute a large number of the same item, fair market value is the price at which comparable numbers of the item are being sold. File tax return for 2012 Example. File tax return for 2012 You purchase 500 bibles for $1,000. File tax return for 2012 The person who sells them to you says the retail value of these bibles is $3,000. File tax return for 2012 If you contribute the bibles to a qualified organization, you can claim a deduction only for the price at which similar numbers of the same bible are currently being sold. File tax return for 2012 Your charitable contribution is $1,000, unless you can show that similar numbers of that bible wer
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Health Insurance

Learn about your health insurance options. Get information about the Health Insurance Marketplace, Medicare, Medicaid, and other programs to help you pay for your medical expenses.

Health Insurance Overview

Health care is expensive and few individuals can afford to pay the full costs. Having health insurance allows you to get the treatment you need without incurring huge medical bills. 

Most Americans have private health insurance or participate in public programs, such as Medicare or Medicaid, but many Americans are uninsured due to finances and/or pre-existing conditions.

Under the Affordable Care Act, all Americans will be able to get health insurance regardless of income or health history.

Affordable Care Act

The Affordable Care Act allows all Americans to get comprehensive health insurance and offers new rights and protections. Some provisions of the law have already taken effect while others will be implemented in the coming years.

You can now enroll in health insurance through your state's Health Insurance Marketplace. The Marketplace can help you compare plans and find one that fits your needs and budget.

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Medicaid

States decide on the benefits provided under Medicaid, but Medicaid usually provides health care for low-income children and families, and people with disabilities. Covered services usually include doctor visits, hospital care, vaccinations, prescription drugs, vision, hearing, long-term care, and preventive care for children.

  • State Medicaid Programs – Learn about the Medicaid program in your state, and how to apply. Note that if you're not eligible for Medicaid now, you may qualify in 2014, when new rules take effect in most states. 
  • Medicaid and the Health Insurance Marketplace – If you are eligible for Medicaid, you don't need to buy coverage through the Health Insurance Marketplace.

Medicare

Medicare is a government health insurance plan for people 65 or older, people under 65 with certain disabilities, and people with end-stage renal disease. Medicare helps to pay for care in hospitals, skilled nursing facilities, hospice care, and some home health care. Coverage can also include doctors’ services and prescription drugs.

Under the health care law, Medicare benefits have been expanded for preventive care and drug coverage. Medicare is not part of the Health Insurance Marketplace, so—if you have Medicare—you will not need to take any action as a result of the new Marketplace. 

  • Medicare – Learn about the Medicare program; enroll online; and find a Medicare-enrolled doctor or health care facility.
  • Replace Your Medicare Card – If your Medicare card is lost, stolen, or damaged, you can ask for a new one online.

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COBRA: Keep Your Insurance If You Leave Your Job

The Consolidated Omnibus Budget Reconciliation Act (COBRA) can help you temporarily keep your health insurance even though you left your job. Eligibility for the program is based on the reason you left your job, and even if you get to keep your insurance, you may be required to pay the entire premium for coverage.

  • COBRA – Learn more about the costs and benefits of the COBRA program.
  • An Employee's Guide to Health Benefits Under COBRA – This booklet explains your rights under COBRA to a temporary extension of employer-provided group health coverage, called COBRA continuation coverage.

Starting in 2014, you may change from COBRA coverage to Marketplace health insurance coverage. Losing your COBRA coverage qualifies you to buy health insurance in the Marketplace, even if it's not during open enrollment. This is true whether your coverage runs out, or you choose to end it.

Health Insurance for Children: CHIP

The Children’s Health Insurance Program (CHIP) provides free or low-cost health coverage for low-income children. Each state decides on the benefits provided under CHIP, but all states cover routine check-ups, immunizations, hospital care, dental care, and lab and x-ray services.

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How to Appeal a Health Insurance Claim

If your health insurer has denied coverage for medical care you received, you have the right to appeal the claim, and ask that the company reverse that decision. You can be your own health care advocate. Follow these five steps:

  1. Review your policy and explanation of benefits.
  2. Contact your insurer and keep detailed records of your contacts (copies of letters, time and date of conversations).
  3. Request documentation from your doctor or employer to support your case.
  4. Write a formal complaint letter explaining what care was denied and why you are appealing through use of the company's internal review process.
  5. If the internal appeal is not granted through step four, file a claim with your state's insurance department.

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The File Tax Return For 2012

File tax return for 2012 3. File tax return for 2012   Limit on Annual Additions Table of Contents Ministers and church employees. File tax return for 2012 Includible Compensation for Your Most Recent Year of ServiceMost Recent Year of Service Includible Compensation The first component of MAC is the limit on annual additions. File tax return for 2012 This is a limit on the total contributions (elective deferrals, nonelective contributions, and after-tax contributions) that can be made to your 403(b) account. File tax return for 2012 The limit on annual additions generally is the lesser of: $51,000 for 2013 and $52,000 for 2014, or 100% of your includible compensation for your most recent year of service. File tax return for 2012 More than one 403(b) account. File tax return for 2012 If you contributed to more than one 403(b) account, you must combine the contributions made to all 403(b) accounts on your behalf by your employer. File tax return for 2012 Ministers and church employees. File tax return for 2012   If you are a minister or a church employee, you may be able to increase your limit on annual additions or use different rules when figuring your limit on annual additions. File tax return for 2012 For more information, see chapter 5. File tax return for 2012 Participation in a qualified plan. File tax return for 2012 If you participated in a 403(b) plan and a qualified plan, you must combine contributions made to your 403(b) account with contributions to a qualified plan and simplified employee pensions of all corporations, partnerships, and sole proprietorships in which you have more than 50% control. File tax return for 2012 You can use Part I of Worksheet 1 in chapter 9 to figure your limit on annual additions. File tax return for 2012 Includible Compensation for Your Most Recent Year of Service Definition. File tax return for 2012   Generally, includible compensation for your most recent year of service is the amount of taxable wages and benefits you received from the employer that maintained a 403(b) account for your benefit during your most recent year of service. File tax return for 2012 When figuring your includible compensation for your most recent year of service, keep in mind that your most recent year of service may not be the same as your employer's most recent annual work period. File tax return for 2012 This can happen if your tax year is not the same as your employer's annual work period. File tax return for 2012 When figuring includible compensation for your most recent year of service, do not mix compensation or service of one employer with compensation or service of another employer. File tax return for 2012 Most Recent Year of Service Your most recent year of service is your last full year of service, ending on the last day of your tax year that you worked for the employer that maintained a 403(b) account on your behalf. File tax return for 2012 Tax year different from employer's annual work period. File tax return for 2012   If your tax year is not the same as your employer's annual work period, your most recent year of service is made up of parts of at least two of your employer's annual work periods. File tax return for 2012 Example. File tax return for 2012 A professor who reports her income on a calendar-year basis is employed on a full-time basis by a university that operates on an academic year (October through May). File tax return for 2012 To figure her includible compensation for 2013, the professor's most recent year of service is her service from January through May 2013 and from October through December 2013. File tax return for 2012 Figuring Your Most Recent Year of Service To figure your most recent year of service, begin by determining what is a full year of service for your position. File tax return for 2012 A full year of service is equal to full-time employment for your employer's annual work period. File tax return for 2012 After identifying a full year of service, begin counting the service you have provided for your employer starting with the service provided in the current year. File tax return for 2012 Part-time or employed only part of the year. File tax return for 2012   If you are a part-time or a full-time employee who is employed for only part of the year, your most recent year of service is your service this year and your service for as many previous years as is necessary to total 1 full year of service. File tax return for 2012 To determine your most recent year of service, add the following periods of service: Your service during the year for which you are figuring the limit on annual additions, and Your service during your preceding tax years until the total service equals 1 year of service or you have figured all of your service with the employer. File tax return for 2012 Example. File tax return for 2012 You were employed on a full-time basis from July through December 2011 (1/2 year of service), July through December 2012 (1/2 year of service), and October through December 2013 (1/4 year of service). File tax return for 2012 Your most recent year of service for computing your limit on annual additions for 2013 is the total of your service during 2013 (1/4 year of service), your service during 2012 (1/2 year of service), and your service during the months October through December 2011 (1/4 year of service). File tax return for 2012 Not yet employed for 1 year. File tax return for 2012   If, at the close of the year, you have not yet worked for your employer for 1 year (including time you worked for the same employer in all earlier years), use the period of time you have worked for the employer as your most recent year of service. File tax return for 2012 Includible Compensation After identifying your most recent year of service, the next step is to identify the includible compensation associated with that full year of service. File tax return for 2012 Includible compensation is not the same as income included on your tax return. File tax return for 2012 Compensation is a combination of income and benefits received in exchange for services provided to your employer. File tax return for 2012 Generally, includible compensation is the amount of income and benefits: Received from the employer who maintains your 403(b) account, and Must be included in your income. File tax return for 2012 Includible compensation includes the following amounts. File tax return for 2012 Elective deferrals (employer's contributions made on your behalf under a salary reduction agreement). File tax return for 2012 Amounts contributed or deferred by your employer under a section 125 cafeteria plan. File tax return for 2012 Amounts contributed or deferred, at the election of the employee, under an eligible section 457 nonqualified deferred compensation plan (state or local government or tax-exempt organization plan). File tax return for 2012  Note. File tax return for 2012 For information about treating elective deferrals under section 457 plans as Roth contributions, see Publication 575. File tax return for 2012 Wages, salaries, and fees for personal services earned with the employer maintaining your 403(b) account. File tax return for 2012 Income otherwise excluded under the foreign earned income exclusion. File tax return for 2012 Pre-tax contributions (employer's contributions made on your behalf according to your election) to a qualified transportation fringe benefit plan. File tax return for 2012 Includible compensation does not include the following items. File tax return for 2012 Your employer's contributions to your 403(b) account. File tax return for 2012 Compensation earned while your employer was not an eligible employer. File tax return for 2012 Your employer's contributions to a qualified plan that: Are on your behalf, and Are excludable from income. File tax return for 2012 The cost of incidental life insurance. File tax return for 2012 See Cost of Incidental Life Insurance, later. File tax return for 2012 If you are a church employee or a foreign missionary, figure includible compensation using the rules explained in chapter 5. File tax return for 2012 Contributions after retirement. File tax return for 2012   Nonelective contributions may be made for an employee for up to 5 years after retirement. File tax return for 2012 These contributions would be based on includible compensation for the last year of service before retirement. File tax return for 2012 Cost of Incidental Life Insurance Includible compensation does not include the cost of incidental life insurance. File tax return for 2012 If all of your 403(b) accounts invest only in mutual funds, then you have no incidental life insurance. File tax return for 2012 If you have an annuity contract, a portion of the cost of that contract may be for incidental life insurance. File tax return for 2012 If so, the cost of the insurance is taxable to you in the year contributed and is considered part of your basis when distributed. File tax return for 2012 Your employer will include the cost of your insurance as taxable wages in box 1 of Form W-2. File tax return for 2012 Not all annuity contracts include life insurance. File tax return for 2012 Contact your plan administrator to determine if your contract includes incidental life insurance. File tax return for 2012 If it does, you will need to figure the cost of life insurance each year the policy is in effect. File tax return for 2012 Figuring the cost of incidental life insurance. File tax return for 2012 If you have determined that part of the cost of your annuity contract is for an incidental life insurance premium, you will need to determine the amount of the premium and subtract it from your includible compensation. File tax return for 2012 To determine the amount of the life insurance premiums, you will need to know the following information. File tax return for 2012 The value of your life insurance contract, which is the amount payable upon your death. File tax return for 2012 The cash value of your life insurance contract at the end of the tax year. File tax return for 2012 Your age on your birthday nearest the beginning of the policy year. File tax return for 2012 Your current life insurance protection under an ordinary retirement income life insurance policy, which is the amount payable upon your death minus the cash value of the contract at the end of the year. File tax return for 2012 You can use Worksheet A, in chapter 9, to determine the cost of your incidental life insurance. File tax return for 2012 Example. File tax return for 2012 Your new contract provides that your beneficiary will receive $10,000 if you should die before retirement. File tax return for 2012 Your cash value in the contract at the end of the first year is zero. File tax return for 2012 Your current life insurance protection for the first year is $10,000 ($10,000 − 0). File tax return for 2012 The cash value in the contract at the end of year two is $1,000, and the current life insurance protection for the second year is $9,000 ($10,000 – $1,000). File tax return for 2012 The 1-year cost of the protection can be calculated by using Figure 3-1, Table of One-Year Term Premiums for $1,000 Life Insurance Protection . File tax return for 2012 The premium rate is determined based on your age on your birthday nearest the beginning of the policy year. File tax return for 2012 Figure 3-1. File tax return for 2012 Table of One-Year Term Premiums for $1,000 Life Insurance Protection Age Cost   Age Cost   Age Cost 0 $0. File tax return for 2012 70   35 $0. File tax return for 2012 99   70 $20. File tax return for 2012 62 1 0. File tax return for 2012 41   36 1. File tax return for 2012 01   71 22. File tax return for 2012 72 2 0. File tax return for 2012 27   37 1. File tax return for 2012 04   72 25. File tax return for 2012 07 3 0. File tax return for 2012 19   38 1. File tax return for 2012 06   73 27. File tax return for 2012 57 4 0. File tax return for 2012 13   39 1. File tax return for 2012 07   74 30. File tax return for 2012 18 5 0. File tax return for 2012 13   40 1. File tax return for 2012 10   75 33. File tax return for 2012 05 6 0. File tax return for 2012 14   41 1. File tax return for 2012 13   76 36. File tax return for 2012 33 7 0. File tax return for 2012 15   42 1. File tax return for 2012 20   77 40. File tax return for 2012 17 8 0. File tax return for 2012 16   43 1. File tax return for 2012 29   78 44. File tax return for 2012 33 9 0. File tax return for 2012 16   44 1. File tax return for 2012 40   79 49. File tax return for 2012 23 10 0. File tax return for 2012 16   45 1. File tax return for 2012 53   80 54. File tax return for 2012 56 11 0. File tax return for 2012 19   46 1. File tax return for 2012 67   81 60. File tax return for 2012 51 12 0. File tax return for 2012 24   47 1. File tax return for 2012 83   82 66. File tax return for 2012 74 13 0. File tax return for 2012 28   48 1. File tax return for 2012 98   83 73. File tax return for 2012 07 14 0. File tax return for 2012 33   49 2. File tax return for 2012 13   84 80. File tax return for 2012 35 15 0. File tax return for 2012 38   50 2. File tax return for 2012 30   85 88. File tax return for 2012 76 16 0. File tax return for 2012 52   51 2. File tax return for 2012 52   86 99. File tax return for 2012 16 17 0. File tax return for 2012 57   52 2. File tax return for 2012 81   87 110. File tax return for 2012 40 18 0. File tax return for 2012 59   53 3. File tax return for 2012 20   88 121. File tax return for 2012 85 19 0. File tax return for 2012 61   54 3. File tax return for 2012 65   89 133. File tax return for 2012 40 20 0. File tax return for 2012 62   55 4. File tax return for 2012 15   90 144. File tax return for 2012 30 21 0. File tax return for 2012 62   56 4. File tax return for 2012 68   91 155. File tax return for 2012 80 22 0. File tax return for 2012 64   57 5. File tax return for 2012 20   92 168. File tax return for 2012 75 23 0. File tax return for 2012 66   58 5. File tax return for 2012 66   93 186. File tax return for 2012 44 24 0. File tax return for 2012 68   59 6. File tax return for 2012 06   94 206. File tax return for 2012 70 25 0. File tax return for 2012 71   60 6. File tax return for 2012 51   95 228. File tax return for 2012 35 26 0. File tax return for 2012 73   61 7. File tax return for 2012 11   96 250. File tax return for 2012 01 27 0. File tax return for 2012 76   62 7. File tax return for 2012 96   97 265. File tax return for 2012 09 28 0. File tax return for 2012 80   63 9. File tax return for 2012 08   98 270. File tax return for 2012 11 29 0. File tax return for 2012 83   64 10. File tax return for 2012 41   99 281. File tax return for 2012 05 30 0. File tax return for 2012 87   65 11. File tax return for 2012 90       31 0. File tax return for 2012 90   66 13. File tax return for 2012 51       32 0. File tax return for 2012 93   67 15. File tax return for 2012 20       33 0. File tax return for 2012 96   68 16. File tax return for 2012 92       34 0. File tax return for 2012 98   69 18. File tax return for 2012 70                       If the current published premium rates per $1,000 of insurance protection charged by an insurer for individual 1-year term life insurance premiums available to all standard risks are lower than those in the preceding table, you can use the lower rates for figuring the cost of insurance in connection with individual policies issued by the same insurer. File tax return for 2012 Example 1. File tax return for 2012 Lynne Green, age 44, and her employer enter into a 403(b) plan that will provide her with a $500 a month annuity upon retirement at age 65. File tax return for 2012 The agreement also provides that if she should die before retirement, her beneficiary will receive the greater of $20,000 or the cash surrender value in the life insurance contract. File tax return for 2012 Using the facts presented we can determine the cost of Lynne's life insurance protection as shown in Table 3-1. File tax return for 2012 Lynne's employer has included $28 for the cost of the life insurance protection in her current year's income. File tax return for 2012 When figuring her includible compensation for this year, Lynne will subtract $28. File tax return for 2012 Table 3-1. File tax return for 2012 Worksheet A. File tax return for 2012 Cost of Incidental Life Insurance Note. File tax return for 2012 Use this worksheet to figure the cost of incidental life insurance included in your annuity contract. File tax return for 2012 This amount will be used to figure includible compensation for your most recent year of service. File tax return for 2012 1. File tax return for 2012 Enter the value of the contract (amount payable upon your death) 1. File tax return for 2012 $20,000. File tax return for 2012 00 2. File tax return for 2012 Enter the cash value in the contract at the end of the year 2. File tax return for 2012 0. File tax return for 2012 00 3. File tax return for 2012 Subtract line 2 from line 1. File tax return for 2012 This is the value of your current life insurance protection 3. File tax return for 2012 $20,000. File tax return for 2012 00 4. File tax return for 2012 Enter your age on your birthday nearest the beginning of the policy year 4. File tax return for 2012 44 5. File tax return for 2012 Enter the 1-year term premium for $1,000 of life insurance based on your age. File tax return for 2012 (From Figure 3-1) 5. File tax return for 2012 $1. File tax return for 2012 40 6. File tax return for 2012 Divide line 3 by $1,000 6. File tax return for 2012 20 7. File tax return for 2012 Multiply line 6 by line 5. File tax return for 2012 This is the cost of your incidental life insurance 7. File tax return for 2012 $28. File tax return for 2012 00 Example 2. File tax return for 2012 Lynne's cash value in the contract at the end of the second year is $1,000. File tax return for 2012 In year two, the cost of Lynne's life insurance is calculated as shown in Table 3-2. File tax return for 2012 In year two, Lynne's employer will include $29. File tax return for 2012 07 in her current year's income. File tax return for 2012 Lynne will subtract this amount when figuring her includible compensation. File tax return for 2012 Table 3-2. File tax return for 2012 Worksheet A. File tax return for 2012 Cost of Incidental Life Insurance Note. File tax return for 2012 Use this worksheet to figure the cost of incidental life insurance included in your annuity contract. File tax return for 2012 This amount will be used to figure includible compensation for your most recent year of service. File tax return for 2012 1. File tax return for 2012 Enter the value of the contract (amount payable upon your death) 1. File tax return for 2012 $20,000. File tax return for 2012 00 2. File tax return for 2012 Enter the cash value in the contract at the end of the year 2. File tax return for 2012 $1,000. File tax return for 2012 00 3. File tax return for 2012 Subtract line 2 from line 1. File tax return for 2012 This is the value of your current life insurance protection 3. File tax return for 2012 $19,000. File tax return for 2012 00 4. File tax return for 2012 Enter your age on your birthday nearest the beginning of the policy year 4. File tax return for 2012 45 5. File tax return for 2012 Enter the 1-year term premium for $1,000 of life insurance based on your age. File tax return for 2012 (From Figure 3-1) 5. File tax return for 2012 $1. File tax return for 2012 53 6. File tax return for 2012 Divide line 3 by $1,000 6. File tax return for 2012 19 7. File tax return for 2012 Multiply line 6 by line 5. File tax return for 2012 This is the cost of your incidental life insurance 7. File tax return for 2012 $29. File tax return for 2012 07 Figuring Includible Compensation for Your Most Recent Year of Service You can use Worksheet B in chapter 9 to determine your includible compensation for your most recent year of service. File tax return for 2012 Example. File tax return for 2012 Floyd has been periodically working full-time for a local hospital since September 2011. File tax return for 2012 He needs to figure his limit on annual additions for 2014. File tax return for 2012 The hospital's normal annual work period for employees in Floyd's general type of work runs from January to December. File tax return for 2012 During the periods that Floyd was employed with the hospital, the hospital has always been eligible to provide a 403(b) plan to employees. File tax return for 2012 Additionally, the hospital has never provided the employees with a 457 deferred compensation plan, a transportation fringe benefit plan, or a cafeteria plan. File tax return for 2012 Floyd has never worked abroad and there is no life insurance provided under the plan. File tax return for 2012 Table 3-3 shows the service Floyd provided to his employer, his compensation for the periods worked, his elective deferrals, and his taxable wages. File tax return for 2012 Table 3-3. File tax return for 2012 Floyd's Compensation Note. File tax return for 2012 This table shows information Floyd will use to figure includible compensation for his most recent year of service. File tax return for 2012   Year Years of Service Taxable Wages Elective Deferrals 2014 6/12 of  a year $42,000 $2,000 2013 4/12 of  a year $16,000 $1,650 2012 4/12 of  a year $16,000 $1,650 Before Floyd can figure his limit on annual additions, he must figure includible compensation for his most recent year of service. File tax return for 2012 Because Floyd is not planning to work the entire 2014 year, his most recent year of service will include the time he is planning to work in 2014 plus time he worked in the preceding 3 years until the time he worked for the hospital totals 1 year. File tax return for 2012 If the total time he worked is less than 1 year, Floyd will treat it as if it were 1 year. File tax return for 2012 He figures his most recent year of service shown in the following list. File tax return for 2012 Time he will work in 2014 is 6/12 of a year. File tax return for 2012 Time worked in 2013 is 4/12 of a year. File tax return for 2012 All of this time will be used to determine Floyd's most recent year of service. File tax return for 2012 Time worked in 2012 is 4/12 of a year. File tax return for 2012 Floyd only needs 2 months of the 4 months he worked in 2012 to have enough time to total 1 full year. File tax return for 2012 Because he needs only one-half of the actual time he worked, Floyd will use only one-half of his income earned during that period to calculate wages that will be used in figuring his includible compensation. File tax return for 2012 Using the information provided in Table 3-3, wages for Floyd's most recent year of service are $66,000 ($42,000 + $16,000 + $8,000). File tax return for 2012 His includible compensation for his most recent year of service is figured as shown in Table 3-4. File tax return for 2012 After figuring his includible compensation, Floyd determines his limit on annual additions for 2014 to be $52,000, the lesser of his includible compensation, $70,475 (Table 3-4), and the maximum amount of $52,000. File tax return for 2012 Table 3-4. File tax return for 2012 Worksheet B. File tax return for 2012 Includible Compensation for Your Most Recent Year of Service1 Note. File tax return for 2012 Use this worksheet to figure includible compensation for your most recent year of service. File tax return for 2012 1. File tax return for 2012 Enter your includible wages from the employer maintaining your 403(b) account for your most recent year of service 1. File tax return for 2012 $66,000 2. File tax return for 2012 Enter elective deferrals excluded from your gross income for your most recent year of service2 2. File tax return for 2012 4,4753 3. File tax return for 2012 Enter amounts contributed or deferred by your employer under a cafeteria plan for your most recent year of service 3. File tax return for 2012 -0- 4. File tax return for 2012 Enter amounts contributed or deferred by your employer according to your election to your 457 account (a nonqualified plan of a state or local government, or of a tax-exempt organization) for your most recent year of service 4. File tax return for 2012 -0- 5. File tax return for 2012 Enter pre-tax contributions (employer's contributions made on your behalf according to your election) to a qualified transportation fringe benefit plan for your most recent year of service 5. File tax return for 2012 -0- 6. File tax return for 2012 Enter your foreign earned income exclusion for your most recent year of service 6. File tax return for 2012 -0- 7. File tax return for 2012 Add lines 1, 2, 3, 4, 5, and 6 7. File tax return for 2012 70,475 8. File tax return for 2012 Enter the cost of incidental life insurance that is part of your annuity contract for your most recent year of service 8. File tax return for 2012 -0- 9. File tax return for 2012 Enter compensation that was both: Earned during your most recent year of service, and Earned while your employer was not qualified to maintain a 403(b) plan 9. File tax return for 2012 -0- 10. File tax return for 2012 Add lines 8 and 9 10. File tax return for 2012 -0- 11. File tax return for 2012 Subtract line 10 from line 7. File tax return for 2012 This is your includible compensation for your most recent year of service 11. File tax return for 2012 70,475 1Use estimated amounts if figuring includible compensation before the end of the year. File tax return for 2012 2Elective deferrals made to a designated Roth account are not excluded from your gross income and should not be included on this line. File tax return for 2012  3$4,475 ($2,000 + $1,650 + $825). File tax return for 2012 Prev  Up  Next   Home   More Online Publications