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Filelate Publication 54 - Additional Material Questions and AnswersThis section answers tax- related questions commonly asked by taxpayers living abroad. Filelate 1. Filelate Filing Requirements—Where, When, and How . Filelate 1) When are U. Filelate S. Filelate income tax returns due? . Filelate 2) I am going abroad this year and expect to qualify for the foreign earned income exclusion. Filelate How can I secure an extension of time to file my return, when should I file my return, and what forms are required? . Filelate 3) My entire income qualifies for the foreign earned income exclusion. Filelate Must I file a tax return? . Filelate 4) I was sent abroad by my company in November of last year. Filelate I plan to secure an extension of time on Form 2350 to file my tax return for last year because I expect to qualify for the foreign earned income exclusion under the physical presence test. Filelate However, if my company recalls me to the United States before the end of the qualifying period and I find I will not qualify for the exclusion, how and when should I file my return? . Filelate 5) I am a U. Filelate S. Filelate citizen and have no taxable income from the United States, but I have substantial income from a foreign source. Filelate Am I required to file a U. Filelate S. Filelate income tax return? . Filelate 6) I am a U. Filelate S. Filelate citizen who has retired, and I expect to remain in a foreign country. Filelate Do I have any further U. Filelate S. Filelate tax obligations? . Filelate 7) I have been a bona fide resident of a foreign country for over 5 years. Filelate Is it necessary for me to pay estimated tax? . Filelate 8) Will a check payable in foreign currency be acceptable in payment of my U. Filelate S. Filelate tax? . Filelate 9) I have met the test for physical presence in a foreign country and am filing returns for 2 years. Filelate Must I file a separate Form 2555 (or Form 2555-EZ) with each return? . Filelate 10) Does a Form 2555 (or 2555-EZ) with a Schedule C or Form W-2 attached constitute a return? . Filelate 11) On Form 2350, Application for Extension of Time To File U. Filelate S. Filelate Income Tax Return, I stated that I would qualify for the foreign earned income exclusion under the physical presence test. Filelate If I qualify under the bona fide residence test, can I file my return on that basis? . Filelate 12) I am a U. Filelate S. Filelate citizen who worked in the United States for 6 months last year. Filelate I accepted employment overseas in July of last year and expect to qualify for the foreign earned income exclusion. Filelate Should I file a return and pay tax on the income earned in the United States during the first 6 months and then, when I qualify, file another return covering the last 6 months of the year? . Filelate 13) I am a U. Filelate S. Filelate citizen. Filelate I have lived abroad for a number of years and recently realized that I should have been filing U. Filelate S. Filelate income tax returns. Filelate How do I correct this oversight in not having filed returns for these years? . Filelate 14) In 2008, I qualified to exclude my foreign earned income, but I did not claim this exclusion on the return I filed in 2009. Filelate I paid all outstanding taxes with the return. Filelate Can I file a claim for refund now? . Filelate 1) When are U. Filelate S. Filelate income tax returns due? Generally, for calendar year taxpayers, U. Filelate S. Filelate income tax returns are due on April 15. Filelate If you are a U. Filelate S. Filelate citizen or resident and both your tax home and your abode are outside the United States and Puerto Rico on the regular due date, an automatic extension is granted to June 15 for filing the return. Filelate Interest will be charged on any tax due, as shown on the return, from April 15. Filelate a) You should file Form 2350 by the due date of your return to request an extension of time to file. Filelate Form 2350 is a special form for those U. Filelate S. Filelate citizens or residents abroad who expect to qualify for the foreign earned income exclusion or the housing exclusion or deduction under either the bona fide residence test or physical presence test and would like to have an extension of time to delay filing until after they have qualified. Filelate b) If the extension is granted, you should file your return after you qualify, but by the approved extension date. Filelate c) You must file your Form 1040 with Form 2555 (or Form 2555-EZ). Filelate Generally, yes. Filelate Every U. Filelate S. Filelate citizen or resident who receives income must file a U. Filelate S. Filelate income tax return unless total income without regard to the foreign earned income exclusion is below an amount based on filing status. Filelate The income levels for filing purposes are discussed under Filing Requirements in chapter 1. Filelate If your regular filing date has passed, you should file a return, Form 1040, as soon as possible for last year. Filelate Include a statement with this return noting that you have returned to the United States and will not qualify for the foreign earned income exclusion. Filelate You must report your worldwide income on the return. Filelate If you paid a foreign tax on the income earned abroad, you may be able to either deduct this tax as an itemized deduction or claim it as a credit against your U. Filelate S. Filelate income tax. Filelate However, if you pay the tax due after the regular due date, interest will be charged from the regular due date until the date the tax is paid. Filelate Yes. Filelate All U. Filelate S. Filelate citizens and resident aliens are subject to U. Filelate S. Filelate tax on their worldwide income. Filelate If you paid taxes to a foreign government on income from sources outside the United States, you may be able to claim a foreign tax credit against your U. Filelate S. Filelate income tax liability for the foreign taxes paid. Filelate Form 1116 is used to figure the allowable credit. Filelate Your U. Filelate S. Filelate tax obligation on your income is the same as that of a retired person living in the United States. Filelate (See the discussion on filing requirements in chapter 1 of this publication. Filelate ) U. Filelate S. Filelate taxpayers overseas have the same requirements for paying estimated tax as those in the United States. Filelate See the discussion under Estimated Tax in chapter 1. Filelate Overseas taxpayers should not include in their estimated income any income they receive that is, or will be, exempt from U. Filelate S. Filelate taxation. Filelate Overseas taxpayers can deduct their estimated housing deduction in figuring their estimated tax. Filelate The first installment of estimated tax is due on April 15 of the year for which the income is earned. Filelate Generally, only U. Filelate S. Filelate currency is acceptable for payment of income tax. Filelate However, if you are a Fulbright grantee, see Fulbright Grant in chapter 1. Filelate Yes. Filelate A Form 2555 (or Form 2555-EZ) must be filed with each Form 1040 tax return on which the benefits of income earned abroad are claimed. Filelate No. Filelate The Form 2555 (or 2555-EZ), Schedule C, and Form W-2 are merely attachments and do not relieve you of the requirement to file a Form 1040 to show the sources of income reported and the exclusions or deductions claimed. Filelate Yes. Filelate You can claim the foreign earned income exclusion and the foreign housing exclusion or deduction under either test as long as you meet the requirements. Filelate You are not bound by the test indicated in the application for extension of time. Filelate You must be sure, however, that you file the Form 1040 by the date approved on Form 2350, since a return filed after that date may be subject to a failure to file penalty. Filelate If you will not qualify under the bona fide residence test until a date later than the extension granted under the physical presence rule, apply for a new extension to a date 30 days beyond the date you expect to qualify as a bona fide resident. Filelate No. Filelate You have the choice of one of the following two methods of filing your return: a) You can file your return when due under the regular filing rules, report all your income without excluding your foreign earned income, and pay the tax due. Filelate After you have qualified for the exclusion, you can file an amended return, Form 1040X, accompanied by Form 2555 (or 2555-EZ), for a refund of any excess tax paid. Filelate b) You can postpone the filing of your tax return by applying on Form 2350 for an extension of time to file to a date 30 days beyond the date you expect to qualify under either the bona fide residence test or the physical presence test, then file your return reflecting the exclusion of foreign earned income. Filelate This allows you to file only once and saves you from paying the tax and waiting for a refund. Filelate However, interest is charged on any tax due on the postponed tax return, but interest is not paid on refunds paid within 45 days after the return is filed. Filelate If you have moving expenses that are for services performed in two years, you can be granted an extension until after the end of the second year. Filelate File the late returns as soon as possible, stating your reason for filing late. Filelate For advice on filing the returns, you should contact an  Internal Revenue Service representative in one of the four overseas offices listed in chapter 7. Filelate It is too late to claim this refund since a claim for refund must be filed within 3 years from the date the return was filed or 2 years from the date the tax was paid, whichever is later. Filelate A return filed before the due date is considered filed on the due date. Filelate . Filelate 2) I am going abroad this year and expect to qualify for the foreign earned income exclusion. Filelate How can I secure an extension of time to file my return, when should I file my return, and what forms are required? a) You should file Form 2350 by the due date of your return to request an extension of time to file. Filelate Form 2350 is a special form for those U. Filelate S. Filelate citizens or residents abroad who expect to qualify for the foreign earned income exclusion or the housing exclusion or deduction under either the bona fide residence test or physical presence test and would like to have an extension of time to delay filing until after they have qualified. Filelate b) If the extension is granted, you should file your return after you qualify, but by the approved extension date. Filelate c) You must file your Form 1040 with Form 2555 (or Form 2555-EZ). Filelate Generally, yes. Filelate Every U. Filelate S. Filelate citizen or resident who receives income must file a U. Filelate S. Filelate income tax return unless total income without regard to the foreign earned income exclusion is below an amount based on filing status. Filelate The income levels for filing purposes are discussed under Filing Requirements in chapter 1. Filelate If your regular filing date has passed, you should file a return, Form 1040, as soon as possible for last year. Filelate Include a statement with this return noting that you have returned to the United States and will not qualify for the foreign earned income exclusion. Filelate You must report your worldwide income on the return. Filelate If you paid a foreign tax on the income earned abroad, you may be able to either deduct this tax as an itemized deduction or claim it as a credit against your U. Filelate S. Filelate income tax. Filelate However, if you pay the tax due after the regular due date, interest will be charged from the regular due date until the date the tax is paid. Filelate Yes. Filelate All U. Filelate S. Filelate citizens and resident aliens are subject to U. Filelate S. Filelate tax on their worldwide income. Filelate If you paid taxes to a foreign government on income from sources outside the United States, you may be able to claim a foreign tax credit against your U. Filelate S. Filelate income tax liability for the foreign taxes paid. Filelate Form 1116 is used to figure the allowable credit. Filelate Your U. Filelate S. Filelate tax obligation on your income is the same as that of a retired person living in the United States. Filelate (See the discussion on filing requirements in chapter 1 of this publication. Filelate ) U. Filelate S. Filelate taxpayers overseas have the same requirements for paying estimated tax as those in the United States. Filelate See the discussion under Estimated Tax in chapter 1. Filelate Overseas taxpayers should not include in their estimated income any income they receive that is, or will be, exempt from U. Filelate S. Filelate taxation. Filelate Overseas taxpayers can deduct their estimated housing deduction in figuring their estimated tax. Filelate The first installment of estimated tax is due on April 15 of the year for which the income is earned. Filelate Generally, only U. Filelate S. Filelate currency is acceptable for payment of income tax. Filelate However, if you are a Fulbright grantee, see Fulbright Grant in chapter 1. Filelate Yes. Filelate A Form 2555 (or Form 2555-EZ) must be filed with each Form 1040 tax return on which the benefits of income earned abroad are claimed. Filelate No. Filelate The Form 2555 (or 2555-EZ), Schedule C, and Form W-2 are merely attachments and do not relieve you of the requirement to file a Form 1040 to show the sources of income reported and the exclusions or deductions claimed. Filelate Yes. Filelate You can claim the foreign earned income exclusion and the foreign housing exclusion or deduction under either test as long as you meet the requirements. Filelate You are not bound by the test indicated in the application for extension of time. Filelate You must be sure, however, that you file the Form 1040 by the date approved on Form 2350, since a return filed after that date may be subject to a failure to file penalty. Filelate If you will not qualify under the bona fide residence test until a date later than the extension granted under the physical presence rule, apply for a new extension to a date 30 days beyond the date you expect to qualify as a bona fide resident. Filelate No. Filelate You have the choice of one of the following two methods of filing your return: a) You can file your return when due under the regular filing rules, report all your income without excluding your foreign earned income, and pay the tax due. Filelate After you have qualified for the exclusion, you can file an amended return, Form 1040X, accompanied by Form 2555 (or 2555-EZ), for a refund of any excess tax paid. Filelate b) You can postpone the filing of your tax return by applying on Form 2350 for an extension of time to file to a date 30 days beyond the date you expect to qualify under either the bona fide residence test or the physical presence test, then file your return reflecting the exclusion of foreign earned income. Filelate This allows you to file only once and saves you from paying the tax and waiting for a refund. Filelate However, interest is charged on any tax due on the postponed tax return, but interest is not paid on refunds paid within 45 days after the return is filed. Filelate If you have moving expenses that are for services performed in two years, you can be granted an extension until after the end of the second year. Filelate File the late returns as soon as possible, stating your reason for filing late. Filelate For advice on filing the returns, you should contact an  Internal Revenue Service representative in one of the four overseas offices listed in chapter 7. Filelate It is too late to claim this refund since a claim for refund must be filed within 3 years from the date the return was filed or 2 years from the date the tax was paid, whichever is later. Filelate A return filed before the due date is considered filed on the due date. Filelate . Filelate 3) My entire income qualifies for the foreign earned income exclusion. Filelate Must I file a tax return? Generally, yes. Filelate Every U. Filelate S. Filelate citizen or resident who receives income must file a U. Filelate S. Filelate income tax return unless total income without regard to the foreign earned income exclusion is below an amount based on filing status. Filelate The income levels for filing purposes are discussed under Filing Requirements in chapter 1. Filelate If your regular filing date has passed, you should file a return, Form 1040, as soon as possible for last year. Filelate Include a statement with this return noting that you have returned to the United States and will not qualify for the foreign earned income exclusion. Filelate You must report your worldwide income on the return. Filelate If you paid a foreign tax on the income earned abroad, you may be able to either deduct this tax as an itemized deduction or claim it as a credit against your U. Filelate S. Filelate income tax. Filelate However, if you pay the tax due after the regular due date, interest will be charged from the regular due date until the date the tax is paid. Filelate Yes. Filelate All U. Filelate S. Filelate citizens and resident aliens are subject to U. Filelate S. Filelate tax on their worldwide income. Filelate If you paid taxes to a foreign government on income from sources outside the United States, you may be able to claim a foreign tax credit against your U. Filelate S. Filelate income tax liability for the foreign taxes paid. Filelate Form 1116 is used to figure the allowable credit. Filelate Your U. Filelate S. Filelate tax obligation on your income is the same as that of a retired person living in the United States. Filelate (See the discussion on filing requirements in chapter 1 of this publication. Filelate ) U. Filelate S. Filelate taxpayers overseas have the same requirements for paying estimated tax as those in the United States. Filelate See the discussion under Estimated Tax in chapter 1. Filelate Overseas taxpayers should not include in their estimated income any income they receive that is, or will be, exempt from U. Filelate S. Filelate taxation. Filelate Overseas taxpayers can deduct their estimated housing deduction in figuring their estimated tax. Filelate The first installment of estimated tax is due on April 15 of the year for which the income is earned. Filelate Generally, only U. Filelate S. Filelate currency is acceptable for payment of income tax. Filelate However, if you are a Fulbright grantee, see Fulbright Grant in chapter 1. Filelate Yes. Filelate A Form 2555 (or Form 2555-EZ) must be filed with each Form 1040 tax return on which the benefits of income earned abroad are claimed. Filelate No. Filelate The Form 2555 (or 2555-EZ), Schedule C, and Form W-2 are merely attachments and do not relieve you of the requirement to file a Form 1040 to show the sources of income reported and the exclusions or deductions claimed. Filelate Yes. Filelate You can claim the foreign earned income exclusion and the foreign housing exclusion or deduction under either test as long as you meet the requirements. Filelate You are not bound by the test indicated in the application for extension of time. Filelate You must be sure, however, that you file the Form 1040 by the date approved on Form 2350, since a return filed after that date may be subject to a failure to file penalty. Filelate If you will not qualify under the bona fide residence test until a date later than the extension granted under the physical presence rule, apply for a new extension to a date 30 days beyond the date you expect to qualify as a bona fide resident. Filelate No. Filelate You have the choice of one of the following two methods of filing your return: a) You can file your return when due under the regular filing rules, report all your income without excluding your foreign earned income, and pay the tax due. Filelate After you have qualified for the exclusion, you can file an amended return, Form 1040X, accompanied by Form 2555 (or 2555-EZ), for a refund of any excess tax paid. Filelate b) You can postpone the filing of your tax return by applying on Form 2350 for an extension of time to file to a date 30 days beyond the date you expect to qualify under either the bona fide residence test or the physical presence test, then file your return reflecting the exclusion of foreign earned income. Filelate This allows you to file only once and saves you from paying the tax and waiting for a refund. Filelate However, interest is charged on any tax due on the postponed tax return, but interest is not paid on refunds paid within 45 days after the return is filed. Filelate If you have moving expenses that are for services performed in two years, you can be granted an extension until after the end of the second year. Filelate File the late returns as soon as possible, stating your reason for filing late. Filelate For advice on filing the returns, you should contact an  Internal Revenue Service representative in one of the four overseas offices listed in chapter 7. Filelate It is too late to claim this refund since a claim for refund must be filed within 3 years from the date the return was filed or 2 years from the date the tax was paid, whichever is later. Filelate A return filed before the due date is considered filed on the due date. Filelate . Filelate 4) I was sent abroad by my company in November of last year. Filelate I plan to secure an extension of time on Form 2350 to file my tax return for last year because I expect to qualify for the foreign earned income exclusion under the physical presence test. Filelate However, if my company recalls me to the United States before the end of the qualifying period and I find I will not qualify for the exclusion, how and when should I file my return? If your regular filing date has passed, you should file a return, Form 1040, as soon as possible for last year. Filelate Include a statement with this return noting that you have returned to the United States and will not qualify for the foreign earned income exclusion. Filelate You must report your worldwide income on the return. Filelate If you paid a foreign tax on the income earned abroad, you may be able to either deduct this tax as an itemized deduction or claim it as a credit against your U. Filelate S. Filelate income tax. Filelate However, if you pay the tax due after the regular due date, interest will be charged from the regular due date until the date the tax is paid. Filelate Yes. Filelate All U. Filelate S. Filelate citizens and resident aliens are subject to U. Filelate S. Filelate tax on their worldwide income. Filelate If you paid taxes to a foreign government on income from sources outside the United States, you may be able to claim a foreign tax credit against your U. Filelate S. Filelate income tax liability for the foreign taxes paid. Filelate Form 1116 is used to figure the allowable credit. Filelate Your U. Filelate S. Filelate tax obligation on your income is the same as that of a retired person living in the United States. Filelate (See the discussion on filing requirements in chapter 1 of this publication. Filelate ) U. Filelate S. Filelate taxpayers overseas have the same requirements for paying estimated tax as those in the United States. Filelate See the discussion under Estimated Tax in chapter 1. Filelate Overseas taxpayers should not include in their estimated income any income they receive that is, or will be, exempt from U. Filelate S. Filelate taxation. Filelate Overseas taxpayers can deduct their estimated housing deduction in figuring their estimated tax. Filelate The first installment of estimated tax is due on April 15 of the year for which the income is earned. Filelate Generally, only U. Filelate S. Filelate currency is acceptable for payment of income tax. Filelate However, if you are a Fulbright grantee, see Fulbright Grant in chapter 1. Filelate Yes. Filelate A Form 2555 (or Form 2555-EZ) must be filed with each Form 1040 tax return on which the benefits of income earned abroad are claimed. Filelate No. Filelate The Form 2555 (or 2555-EZ), Schedule C, and Form W-2 are merely attachments and do not relieve you of the requirement to file a Form 1040 to show the sources of income reported and the exclusions or deductions claimed. Filelate Yes. Filelate You can claim the foreign earned income exclusion and the foreign housing exclusion or deduction under either test as long as you meet the requirements. Filelate You are not bound by the test indicated in the application for extension of time. Filelate You must be sure, however, that you file the Form 1040 by the date approved on Form 2350, since a return filed after that date may be subject to a failure to file penalty. Filelate If you will not qualify under the bona fide residence test until a date later than the extension granted under the physical presence rule, apply for a new extension to a date 30 days beyond the date you expect to qualify as a bona fide resident. Filelate No. Filelate You have the choice of one of the following two methods of filing your return: a) You can file your return when due under the regular filing rules, report all your income without excluding your foreign earned income, and pay the tax due. Filelate After you have qualified for the exclusion, you can file an amended return, Form 1040X, accompanied by Form 2555 (or 2555-EZ), for a refund of any excess tax paid. Filelate b) You can postpone the filing of your tax return by applying on Form 2350 for an extension of time to file to a date 30 days beyond the date you expect to qualify under either the bona fide residence test or the physical presence test, then file your return reflecting the exclusion of foreign earned income. Filelate This allows you to file only once and saves you from paying the tax and waiting for a refund. Filelate However, interest is charged on any tax due on the postponed tax return, but interest is not paid on refunds paid within 45 days after the return is filed. Filelate If you have moving expenses that are for services performed in two years, you can be granted an extension until after the end of the second year. Filelate File the late returns as soon as possible, stating your reason for filing late. Filelate For advice on filing the returns, you should contact an  Internal Revenue Service representative in one of the four overseas offices listed in chapter 7. Filelate It is too late to claim this refund since a claim for refund must be filed within 3 years from the date the return was filed or 2 years from the date the tax was paid, whichever is later. Filelate A return filed before the due date is considered filed on the due date. Filelate . Filelate 5) I am a U. Filelate S. Filelate citizen and have no taxable income from the United States, but I have substantial income from a foreign source. Filelate Am I required to file a U. Filelate S. Filelate income tax return? Yes. Filelate All U. Filelate S. Filelate citizens and resident aliens are subject to U. Filelate S. Filelate tax on their worldwide income. Filelate If you paid taxes to a foreign government on income from sources outside the United States, you may be able to claim a foreign tax credit against your U. Filelate S. Filelate income tax liability for the foreign taxes paid. Filelate Form 1116 is used to figure the allowable credit. Filelate Your U. Filelate S. Filelate tax obligation on your income is the same as that of a retired person living in the United States. Filelate (See the discussion on filing requirements in chapter 1 of this publication. Filelate ) U. Filelate S. Filelate taxpayers overseas have the same requirements for paying estimated tax as those in the United States. Filelate See the discussion under Estimated Tax in chapter 1. Filelate Overseas taxpayers should not include in their estimated income any income they receive that is, or will be, exempt from U. Filelate S. Filelate taxation. Filelate Overseas taxpayers can deduct their estimated housing deduction in figuring their estimated tax. Filelate The first installment of estimated tax is due on April 15 of the year for which the income is earned. Filelate Generally, only U. Filelate S. Filelate currency is acceptable for payment of income tax. Filelate However, if you are a Fulbright grantee, see Fulbright Grant in chapter 1. Filelate Yes. Filelate A Form 2555 (or Form 2555-EZ) must be filed with each Form 1040 tax return on which the benefits of income earned abroad are claimed. Filelate No. Filelate The Form 2555 (or 2555-EZ), Schedule C, and Form W-2 are merely attachments and do not relieve you of the requirement to file a Form 1040 to show the sources of income reported and the exclusions or deductions claimed. Filelate Yes. Filelate You can claim the foreign earned income exclusion and the foreign housing exclusion or deduction under either test as long as you meet the requirements. Filelate You are not bound by the test indicated in the application for extension of time. Filelate You must be sure, however, that you file the Form 1040 by the date approved on Form 2350, since a return filed after that date may be subject to a failure to file penalty. Filelate If you will not qualify under the bona fide residence test until a date later than the extension granted under the physical presence rule, apply for a new extension to a date 30 days beyond the date you expect to qualify as a bona fide resident. Filelate No. Filelate You have the choice of one of the following two methods of filing your return: a) You can file your return when due under the regular filing rules, report all your income without excluding your foreign earned income, and pay the tax due. Filelate After you have qualified for the exclusion, you can file an amended return, Form 1040X, accompanied by Form 2555 (or 2555-EZ), for a refund of any excess tax paid. Filelate b) You can postpone the filing of your tax return by applying on Form 2350 for an extension of time to file to a date 30 days beyond the date you expect to qualify under either the bona fide residence test or the physical presence test, then file your return reflecting the exclusion of foreign earned income. Filelate This allows you to file only once and saves you from paying the tax and waiting for a refund. Filelate However, interest is charged on any tax due on the postponed tax return, but interest is not paid on refunds paid within 45 days after the return is filed. Filelate If you have moving expenses that are for services performed in two years, you can be granted an extension until after the end of the second year. Filelate File the late returns as soon as possible, stating your reason for filing late. Filelate For advice on filing the returns, you should contact an  Internal Revenue Service representative in one of the four overseas offices listed in chapter 7. Filelate It is too late to claim this refund since a claim for refund must be filed within 3 years from the date the return was filed or 2 years from the date the tax was paid, whichever is later. Filelate A return filed before the due date is considered filed on the due date. Filelate . Filelate 6) I am a U. Filelate S. Filelate citizen who has retired, and I expect to remain in a foreign country. Filelate Do I have any further U. Filelate S. Filelate tax obligations? Your U. Filelate S. Filelate tax obligation on your income is the same as that of a retired person living in the United States. Filelate (See the discussion on filing requirements in chapter 1 of this publication. Filelate ) U. Filelate S. Filelate taxpayers overseas have the same requirements for paying estimated tax as those in the United States. Filelate See the discussion under Estimated Tax in chapter 1. Filelate Overseas taxpayers should not include in their estimated income any income they receive that is, or will be, exempt from U. Filelate S. Filelate taxation. Filelate Overseas taxpayers can deduct their estimated housing deduction in figuring their estimated tax. Filelate The first installment of estimated tax is due on April 15 of the year for which the income is earned. Filelate Generally, only U. Filelate S. Filelate currency is acceptable for payment of income tax. Filelate However, if you are a Fulbright grantee, see Fulbright Grant in chapter 1. Filelate Yes. Filelate A Form 2555 (or Form 2555-EZ) must be filed with each Form 1040 tax return on which the benefits of income earned abroad are claimed. Filelate No. Filelate The Form 2555 (or 2555-EZ), Schedule C, and Form W-2 are merely attachments and do not relieve you of the requirement to file a Form 1040 to show the sources of income reported and the exclusions or deductions claimed. Filelate Yes. Filelate You can claim the foreign earned income exclusion and the foreign housing exclusion or deduction under either test as long as you meet the requirements. Filelate You are not bound by the test indicated in the application for extension of time. Filelate You must be sure, however, that you file the Form 1040 by the date approved on Form 2350, since a return filed after that date may be subject to a failure to file penalty. Filelate If you will not qualify under the bona fide residence test until a date later than the extension granted under the physical presence rule, apply for a new extension to a date 30 days beyond the date you expect to qualify as a bona fide resident. Filelate No. Filelate You have the choice of one of the following two methods of filing your return: a) You can file your return when due under the regular filing rules, report all your income without excluding your foreign earned income, and pay the tax due. Filelate After you have qualified for the exclusion, you can file an amended return, Form 1040X, accompanied by Form 2555 (or 2555-EZ), for a refund of any excess tax paid. Filelate b) You can postpone the filing of your tax return by applying on Form 2350 for an extension of time to file to a date 30 days beyond the date you expect to qualify under either the bona fide residence test or the physical presence test, then file your return reflecting the exclusion of foreign earned income. Filelate This allows you to file only once and saves you from paying the tax and waiting for a refund. Filelate However, interest is charged on any tax due on the postponed tax return, but interest is not paid on refunds paid within 45 days after the return is filed. Filelate If you have moving expenses that are for services performed in two years, you can be granted an extension until after the end of the second year. Filelate File the late returns as soon as possible, stating your reason for filing late. Filelate For advice on filing the returns, you should contact an  Internal Revenue Service representative in one of the four overseas offices listed in chapter 7. Filelate It is too late to claim this refund since a claim for refund must be filed within 3 years from the date the return was filed or 2 years from the date the tax was paid, whichever is later. Filelate A return filed before the due date is considered filed on the due date. Filelate . Filelate 7) I have been a bona fide resident of a foreign country for over 5 years. Filelate Is it necessary for me to pay estimated tax? U. Filelate S. Filelate taxpayers overseas have the same requirements for paying estimated tax as those in the United States. Filelate See the discussion under Estimated Tax in chapter 1. Filelate Overseas taxpayers should not include in their estimated income any income they receive that is, or will be, exempt from U. Filelate S. Filelate taxation. Filelate Overseas taxpayers can deduct their estimated housing deduction in figuring their estimated tax. Filelate The first installment of estimated tax is due on April 15 of the year for which the income is earned. Filelate Generally, only U. Filelate S. Filelate currency is acceptable for payment of income tax. Filelate However, if you are a Fulbright grantee, see Fulbright Grant in chapter 1. Filelate Yes. Filelate A Form 2555 (or Form 2555-EZ) must be filed with each Form 1040 tax return on which the benefits of income earned abroad are claimed. Filelate No. Filelate The Form 2555 (or 2555-EZ), Schedule C, and Form W-2 are merely attachments and do not relieve you of the requirement to file a Form 1040 to show the sources of income reported and the exclusions or deductions claimed. Filelate Yes. Filelate You can claim the foreign earned income exclusion and the foreign housing exclusion or deduction under either test as long as you meet the requirements. Filelate You are not bound by the test indicated in the application for extension of time. Filelate You must be sure, however, that you file the Form 1040 by the date approved on Form 2350, since a return filed after that date may be subject to a failure to file penalty. Filelate If you will not qualify under the bona fide residence test until a date later than the extension granted under the physical presence rule, apply for a new extension to a date 30 days beyond the date you expect to qualify as a bona fide resident. Filelate No. Filelate You have the choice of one of the following two methods of filing your return: a) You can file your return when due under the regular filing rules, report all your income without excluding your foreign earned income, and pay the tax due. Filelate After you have qualified for the exclusion, you can file an amended return, Form 1040X, accompanied by Form 2555 (or 2555-EZ), for a refund of any excess tax paid. Filelate b) You can postpone the filing of your tax return by applying on Form 2350 for an extension of time to file to a date 30 days beyond the date you expect to qualify under either the bona fide residence test or the physical presence test, then file your return reflecting the exclusion of foreign earned income. Filelate This allows you to file only once and saves you from paying the tax and waiting for a refund. Filelate However, interest is charged on any tax due on the postponed tax return, but interest is not paid on refunds paid within 45 days after the return is filed. Filelate If you have moving expenses that are for services performed in two years, you can be granted an extension until after the end of the second year. Filelate File the late returns as soon as possible, stating your reason for filing late. Filelate For advice on filing the returns, you should contact an  Internal Revenue Service representative in one of the four overseas offices listed in chapter 7. Filelate It is too late to claim this refund since a claim for refund must be filed within 3 years from the date the return was filed or 2 years from the date the tax was paid, whichever is later. Filelate A return filed before the due date is considered filed on the due date. Filelate . Filelate 8) Will a check payable in foreign currency be acceptable in payment of my U. Filelate S. Filelate tax? Generally, only U. Filelate S. Filelate currency is acceptable for payment of income tax. Filelate However, if you are a Fulbright grantee, see Fulbright Grant in chapter 1. Filelate Yes. Filelate A Form 2555 (or Form 2555-EZ) must be filed with each Form 1040 tax return on which the benefits of income earned abroad are claimed. Filelate No. Filelate The Form 2555 (or 2555-EZ), Schedule C, and Form W-2 are merely attachments and do not relieve you of the requirement to file a Form 1040 to show the sources of income reported and the exclusions or deductions claimed. Filelate Yes. Filelate You can claim the foreign earned income exclusion and the foreign housing exclusion or deduction under either test as long as you meet the requirements. Filelate You are not bound by the test indicated in the application for extension of time. Filelate You must be sure, however, that you file the Form 1040 by the date approved on Form 2350, since a return filed after that date may be subject to a failure to file penalty. Filelate If you will not qualify under the bona fide residence test until a date later than the extension granted under the physical presence rule, apply for a new extension to a date 30 days beyond the date you expect to qualify as a bona fide resident. Filelate No. Filelate You have the choice of one of the following two methods of filing your return: a) You can file your return when due under the regular filing rules, report all your income without excluding your foreign earned income, and pay the tax due. Filelate After you have qualified for the exclusion, you can file an amended return, Form 1040X, accompanied by Form 2555 (or 2555-EZ), for a refund of any excess tax paid. Filelate b) You can postpone the filing of your tax return by applying on Form 2350 for an extension of time to file to a date 30 days beyond the date you expect to qualify under either the bona fide residence test or the physical presence test, then file your return reflecting the exclusion of foreign earned income. Filelate This allows you to file only once and saves you from paying the tax and waiting for a refund. Filelate However, interest is charged on any tax due on the postponed tax return, but interest is not paid on refunds paid within 45 days after the return is filed. Filelate If you have moving expenses that are for services performed in two years, you can be granted an extension until after the end of the second year. Filelate File the late returns as soon as possible, stating your reason for filing late. Filelate For advice on filing the returns, you should contact an  Internal Revenue Service representative in one of the four overseas offices listed in chapter 7. Filelate It is too late to claim this refund since a claim for refund must be filed within 3 years from the date the return was filed or 2 years from the date the tax was paid, whichever is later. Filelate A return filed before the due date is considered filed on the due date. Filelate . Filelate 9) I have met the test for physical presence in a foreign country and am filing returns for 2 years. Filelate Must I file a separate Form 2555 (or Form 2555-EZ) with each return? Yes. Filelate A Form 2555 (or Form 2555-EZ) must be filed with each Form 1040 tax return on which the benefits of income earned abroad are claimed. Filelate No. Filelate The Form 2555 (or 2555-EZ), Schedule C, and Form W-2 are merely attachments and do not relieve you of the requirement to file a Form 1040 to show the sources of income reported and the exclusions or deductions claimed. Filelate Yes. Filelate You can claim the foreign earned income exclusion and the foreign housing exclusion or deduction under either test as long as you meet the requirements. Filelate You are not bound by the test indicated in the application for extension of time. Filelate You must be sure, however, that you file the Form 1040 by the date approved on Form 2350, since a return filed after that date may be subject to a failure to file penalty. Filelate If you will not qualify under the bona fide residence test until a date later than the extension granted under the physical presence rule, apply for a new extension to a date 30 days beyond the date you expect to qualify as a bona fide resident. Filelate No. Filelate You have the choice of one of the following two methods of filing your return: a) You can file your return when due under the regular filing rules, report all your income without excluding your foreign earned income, and pay the tax due. Filelate After you have qualified for the exclusion, you can file an amended return, Form 1040X, accompanied by Form 2555 (or 2555-EZ), for a refund of any excess tax paid. Filelate b) You can postpone the filing of your tax return by applying on Form 2350 for an extension of time to file to a date 30 days beyond the date you expect to qualify under either the bona fide residence test or the physical presence test, then file your return reflecting the exclusion of foreign earned income. Filelate This allows you to file only once and saves you from paying the tax and waiting for a refund. Filelate However, interest is charged on any tax due on the postponed tax return, but interest is not paid on refunds paid within 45 days after the return is filed. Filelate If you have moving expenses that are for services performed in two years, you can be granted an extension until after the end of the second year. Filelate File the late returns as soon as possible, stating your reason for filing late. Filelate For advice on filing the returns, you should contact an  Internal Revenue Service representative in one of the four overseas offices listed in chapter 7. Filelate It is too late to claim this refund since a claim for refund must be filed within 3 years from the date the return was filed or 2 years from the date the tax was paid, whichever is later. Filelate A return filed before the due date is considered filed on the due date. Filelate . Filelate 10) Does a Form 2555 (or 2555-EZ) with a Schedule C or Form W-2 attached constitute a return? No. Filelate The Form 2555 (or 2555-EZ), Schedule C, and Form W-2 are merely attachments and do not relieve you of the requirement to file a Form 1040 to show the sources of income reported and the exclusions or deductions claimed. Filelate Yes. Filelate You can claim the foreign earned income exclusion and the foreign housing exclusion or deduction under either test as long as you meet the requirements. Filelate You are not bound by the test indicated in the application for extension of time. Filelate You must be sure, however, that you file the Form 1040 by the date approved on Form 2350, since a return filed after that date may be subject to a failure to file penalty. Filelate If you will not qualify under the bona fide residence test until a date later than the extension granted under the physical presence rule, apply for a new extension to a date 30 days beyond the date you expect to qualify as a bona fide resident. Filelate No. Filelate You have the choice of one of the following two methods of filing your return: a) You can file your return when due under the regular filing rules, report all your income without excluding your foreign earned income, and pay the tax due. Filelate After you have qualified for the exclusion, you can file an amended return, Form 1040X, accompanied by Form 2555 (or 2555-EZ), for a refund of any excess tax paid. Filelate b) You can postpone the filing of your tax return by applying on Form 2350 for an extension of time to file to a date 30 days beyond the date you expect to qualify under either the bona fide residence test or the physical presence test, then file your return reflecting the exclusion of foreign earned income. Filelate This allows you to file only once and saves you from paying the tax and waiting for a refund. Filelate However, interest is charged on any tax due on the postponed tax return, but interest is not paid on refunds paid within 45 days after the return is filed. Filelate If you have moving expenses that are for services performed in two years, you can be granted an extension until after the end of the second year. Filelate File the late returns as soon as possible, stating your reason for filing late. Filelate For advice on filing the returns, you should contact an  Internal Revenue Service representative in one of the four overseas offices listed in chapter 7. Filelate It is too late to claim this refund since a claim for refund must be filed within 3 years from the date the return was filed or 2 years from the date the tax was paid, whichever is later. Filelate A return filed before the due date is considered filed on the due date. Filelate . Filelate 11) On Form 2350, Application for Extension of Time To File U. Filelate S. Filelate Income Tax Return, I stated that I would qualify for the foreign earned income exclusion under the physical presence test. Filelate If I qualify under the bona fide residence test, can I file my return on that basis? Yes. Filelate You can claim the foreign earned income exclusion and the foreign housing exclusion or deduction under either test as long as you meet the requirements. Filelate You are not bound by the test indicated in the application for extension of time. Filelate You must be sure, however, that you file the Form 1040 by the date approved on Form 2350, since a return filed after that date may be subject to a failure to file penalty. Filelate If you will not qualify under the bona fide residence test until a date later than the extension granted under the physical presence rule, apply for a new extension to a date 30 days beyond the date you expect to qualify as a bona fide resident. Filelate No. Filelate You have the choice of one of the following two methods of filing your return: a) You can file your return when due under the regular filing rules, report all your income without excluding your foreign earned income, and pay the tax due. Filelate After you have qualified for the exclusion, you can file an amended return, Form 1040X, accompanied by Form 2555 (or 2555-EZ), for a refund of any excess tax paid. Filelate b) You can postpone the filing of your tax return by applying on Form 2350 for an extension of time to file to a date 30 days beyond the date you expect to qualify under either the bona fide residence test or the physical presence test, then file your return reflecting the exclusion of foreign earned income. Filelate This allows you to file only once and saves you from paying the tax and waiting for a refund. Filelate However, interest is charged on any tax due on the postponed tax return, but interest is not paid on refunds paid within 45 days after the return is filed. Filelate If you have moving expenses that are for services performed in two years, you can be granted an extension until after the end of the second year. Filelate File the late returns as soon as possible, stating your reason for filing late. Filelate For advice on filing the returns, you should contact an  Internal Revenue Service representative in one of the four overseas offices listed in chapter 7. Filelate It is too late to claim this refund since a claim for refund must be filed within 3 years from the date the return was filed or 2 years from the date the tax was paid, whichever is later. Filelate A return filed before the due date is considered filed on the due date. Filelate . Filelate 12) I am a U. Filelate S. Filelate citizen who worked in the United States for 6 months last year. Filelate I accepted employment overseas in July of last year and expect to qualify for the foreign earned income exclusion. Filelate Should I file a return and pay tax on the income earned in the United States during the first 6 months and then, when I qualify, file another return covering the last 6 months of the year? No. Filelate You have the choice of one of the following two methods of filing your return: a) You can file your return when due under the regular filing rules, report all your income without excluding your foreign earned income, and pay the tax due. Filelate After you have qualified for the exclusion, you can file an amended return, Form 1040X, accompanied by Form 2555 (or 2555-EZ), for a refund of any excess tax paid. Filelate b) You can postpone the filing of your tax return by applying on Form 2350 for an extension of time to file to a date 30 days beyond the date you expect to qualify under either the bona fide residence test or the physical presence test, then file your return reflecting the exclusion of foreign earned income. Filelate This allows you to file only once and saves you from paying the tax and waiting for a refund. Filelate However, interest is charged on any tax due on the postponed tax return, but interest is not paid on refunds paid within 45 days after the return is filed. Filelate If you have moving expenses that are for services performed in two years, you can be granted an extension until after the end of the second year. Filelate File the late returns as soon as possible, stating your reason for filing late. Filelate For advice on filing the returns, you should contact an  Internal Revenue Service representative in one of the four overseas offices listed in chapter 7. Filelate It is too late to claim this refund since a claim for refund must be filed within 3 years from the date the return was filed or 2 years from the date the tax was paid, whichever is later. Filelate A return filed before the due date is considered filed on the due date. Filelate . Filelate 13) I am a U. Filelate S. Filelate citizen. Filelate I have lived abroad for a number of years and recently realized that I should have been filing U. Filelate S. Filelate income tax returns. Filelate How do I correct this oversight in not having filed returns for these years? File the late returns as soon as possible, stating your reason for filing late. Filelate For advice on filing the returns, you should contact an  Internal Revenue Service representative in one of the four overseas offices listed in chapter 7. Filelate It is too late to claim this refund since a claim for refund must be filed within 3 years from the date the return was filed or 2 years from the date the tax was paid, whichever is later. Filelate A return filed before the due date is considered filed on the due date. Filelate . Filelate 14) In 2008, I qualified to exclude my foreign earned income, but I did not claim this exclusion on the return I filed in 2009. Filelate I paid all outstanding taxes with the return. Filelate Can I file a claim for refund now? It is too late to claim this refund since a claim for refund must be filed within 3 years from the date the return was filed or 2 years from the date the tax was paid, whichever is later. Filelate A return filed before the due date is considered filed on the due date. Filelate 2. Filelate Meeting the Requirements of Either the Bona Fide Residence Test or the Physical Presence Test . Filelate 1) I recently came to Country X to work for the Orange Tractor Co. Filelate and I expect to be here for 5 or 6 years. Filelate I understand that upon the completion of 1 full year I will qualify for an exclusion or deduction under the bona fide residence test. Filelate Is this correct? . Filelate 2) I understand the physical presence test to be simply a matter of being physically present in a foreign country for at least 330 days within 12 consecutive months; but what are the criteria of the bona fide residence test? . Filelate 3) To meet the qualification of an uninterrupted period which includes an entire taxable year, do I have to be physically present in a foreign country for the entire year? . Filelate 4) I am a U. Filelate S. Filelate citizen and during 2012 was a bona fide resident of Country X. Filelate On January 15, 2013, I was notified that I was to be assigned to Country Y. Filelate I was recalled to New York for 90 days orientation and then went to Country Y, where I have been since. Filelate Although I was not in Country Y on January 1, I was a bona fide resident of Country X and was in Country Y on December 31, 2013. Filelate My family remained in Country X until completion of the orientation period, and my household goods were shipped directly to my new post. Filelate Am I a bona fide resident of a foreign country for 2013, or must I wait for the entire year of 2014 to become one? . Filelate 5) Due to illness, I returned to the United States before I completed my qualifying period to claim the foreign earned income exclusion. Filelate Can I figure the exclusion for the period I resided abroad? . Filelate 6) Can a resident alien of the United States qualify for an exclusion or deduction under the bona fide residence test or the physical presence test? . Filelate 7) On August 13 of last year I left the United States and arrived in Country Z to work for the Gordon Manufacturing Company. Filelate I expected to be able to exclude my foreign earned income under the physical presence test because I planned to be in Country Z for at least 1 year. Filelate However, I was reassigned back to the United States and left Country Z on July 1 of this year. Filelate Can I exclude any of my foreign earned income? . Filelate 1) I recently came to Country X to work for the Orange Tractor Co. Filelate and I expect to be here for 5 or 6 years. Filelate I understand that upon the completion of 1 full year I will qualify for an exclusion or deduction under the bona fide residence test. Filelate Is this correct? Not necessarily. Filelate The law provides that to qualify under this test for the foreign earned income exclusion, the foreign housing exclusion, or the foreign housing deduction, a person must be a “bona fide resident of a foreign country or countries for an uninterrupted period which includes an entire taxable year. Filelate ” If, like most U. Filelate S. Filelate citizens, you file your return on a calendar year basis, the taxable year referred to in the law would be from January 1 to December 31 of any particular year. Filelate Unless you established residence in Country X on January 1, it would be more than 1 year before you would be a bona fide resident of a foreign country. Filelate Once you have completed your qualifying period, however, you are entitled to exclude the income or to claim the housing exclusion or deduction from the date you established bona fide residence. Filelate To be a bona fide resident of a foreign country, you must show that you entered a foreign country intending to remain there for an indefinite or prolonged period and, to that end, you are making your home in that country. Filelate Consideration is given to the type of quarters occupied, whether your family went with you, the type of visa, the employment agreement, and any other factor pertinent to show whether your stay in the foreign country is indefinite or prolonged. Filelate To claim the foreign earned income exclusion or foreign housing exclusion or deduction under this test, the period of foreign residence must include 1 full tax year (usually January 1 – December 31), but once you meet this time requirement, you figure the exclusions and the deduction from the date the residence actually began. Filelate No. Filelate Uninterrupted refers to the bona fide residence proper and not to the physical presence of the individual. Filelate During the period of bona fide residence in a foreign country, even during the first full year, you can leave the country for brief and temporary trips back to the United States or elsewhere for vacation, or even for business. Filelate To preserve your status as a bona fide resident of a foreign country, you must have a clear intention of returning from those trips, without unreasonable delay, to your foreign residence. Filelate Since you did not break your period of foreign residence, you would continue to be a bona fide resident of a foreign country for 2013. Filelate No. Filelate You are not entitled to any exclusion of foreign earned income since you did not complete your qualifying period under either the bona fide residence test or physical presence test. Filelate If you paid foreign tax on the income earned abroad, you may be able to claim that tax as a deduction or as a credit against your U. Filelate S. Filelate tax. Filelate Resident aliens of the United States can qualify for the foreign earned income exclusion, the foreign housing exclusion, or the foreign housing deduction if they meet the requirements of the physical presence test. Filelate Resident aliens who are citizens or nationals of a country with which the United States has an income tax treaty in effect also can qualify under the bona fide residence test. Filelate No. Filelate You cannot exclude any of the income you earned in Country Z because you were not in a foreign country for at least 330 full days as required under the physical presence test. Filelate . Filelate 2) I understand the physical presence test to be simply a matter of being physically present in a foreign country for at least 330 days within 12 consecutive months; but what are the criteria of the bona fide residence test? To be a bona fide resident of a foreign country, you must show that you entered a foreign country intending to remain there for an indefinite or prolonged period and, to that end, you are making your home in that country. Filelate Consideration is given to the type of quarters occupied, whether your family went with you, the type of visa, the employment agreement, and any other factor pertinent to show whether your stay in the foreign country is indefinite or prolonged. Filelate To claim the foreign earned income exclusion or foreign housing exclusion or deduction under this test, the period of foreign residence must include 1 full tax year (usually January 1 – December 31), but once you meet this time requirement, you figure the exclusions and the deduction from the date the residence actually began. Filelate No. Filelate Uninterrupted refers to the bona fide residence proper and not to the physical presence of the individual. Filelate During the period of bona fide residence in a foreign country, even during the first full year, you can leave the country for brief and temporary trips back to the United States or elsewhere for vacation, or even for business. Filelate To preserve your status as a bona fide resident of a foreign country, you must have a clear intention of returning from those trips, without unreasonable delay, to your foreign residence. Filelate Since you did not break your period of foreign residence, you would continue to be a bona fide resident of a foreign country for 2013. Filelate No. Filelate You are not entitled to any exclusion of foreign earned income since you did not complete your qualifying period under either the bona fide residence test or physical presence test. Filelate If you paid foreign tax on the income earned abroad, you may be able to claim that tax as a deduction or as a credit against your U. Filelate S. Filelate tax. Filelate Resident aliens of the United States can qualify for the foreign earned income exclusion, the foreign housing exclusion, or the foreign housing deduction if they meet the requirements of the physical presence test. Filelate Resident aliens who are citizens or nationals of a country with which the United States has an income tax treaty in effect also can qualify under the bona fide residence test. Filelate No. Filelate You cannot exclude any of the income you earned in Country Z because you were not in a foreign country for at least 330 full days as required under the physical presence test. Filelate . Filelate 3) To meet the qualification of “an uninterrupted period which includes an entire taxable year,” do I have to be physically present in a foreign country for the entire year? No. Filelate Uninterrupted refers to the bona fide residence proper and not to the physical presence of the individual. Filelate During the period of bona fide residence in a foreign country, even during the first full year, you can leave the country for brief and temporary trips back to the United States or elsewhere for vacation, or even for business. Filelate To preserve your status as a bona fide resident of a foreign country, you must have a clear intention of returning from those trips, without unreasonable delay, to your foreign residence. Filelate Since you did not break your period of foreign residence, you would continue to be a bona fide resident of a foreign country for 2013. Filelate No. Filelate You are not entitled to any exclusion of foreign earned income since you did not complete your qualifying period under either the bona fide residence test or physical presence test. Filelate If you paid foreign tax on the income earned abroad, you may be able to claim that tax as a deduction or as a credit against your U. Filelate S. Filelate tax. Filelate Resident aliens of the United States can qualify for the foreign earned income exclusion, the foreign housing exclusion, or the foreign housing deduction if they meet the requirements of the physical presence test. Filelate Resident aliens who are citizens or nationals of a country with which the United States has an income tax treaty in effect also can qualify under the bona fide residence test. Filelate No. Filelate You cannot exclude any of the income you earned in Country Z because you were not in a foreign country for at least 330 full days as required under the physical presence test. Filelate . Filelate 4) I am a U. Filelate S. Filelate citizen and during 2012 was a bona fide resident of Country X. Filelate On January 15, 2013, I was notified that I was to be assigned to Country Y. Filelate I was recalled to New York for 90 days orientation and then went to Country Y, where I have been since. Filelate Although I was not in Country Y on January 1, I was a bona fide resident of Country X and was in Country Y on December 31, 2013. Filelate My family remained in Country X until completion of the orientation period, and my household goods were shipped directly to my new post. Filelate Am I a bona fide resident of a foreign country for 2013, or must I wait for the entire year of 2014 to become one? Since you did not break your period of foreign residence, you would continue to be a bona fide resident of a foreign country for 2013. Filelate No. Filelate You are not entitled to any exclusion of foreign earned income since you did not complete your qualifying period under either the bona fide residence test or physical presence test. Filelate If you paid foreign tax on the income earned abroad, you may be able to claim that tax as a deduction or as a credit against your U. Filelate S. Filelate tax. Filelate Resident aliens of the United States can qualify for the foreign earned income exclusion, the foreign housing exclusion, or the foreign housing deduction if they meet the requirements of the physical presence test. Filelate Resident aliens who are citizens or nationals of a country with which the United States has an income tax treaty in effect also can qualify under the bona fide residence test. Filelate No. Filelate You cannot exclude any of the income you earned in Country Z because you were not in a foreign country for at least 330 full days as required under the physical presence test. Filelate . Filelate 5) Due to illness, I returned to the United States before I completed my qualifying period to claim the foreign earned income exclusion. Filelate Can I figure the exclusion for the period I resided abroad? No. Filelate You are not entitled to any exclusion of foreign earned income since you did not complete your qualifying period under either the bona fide residence test or physical presence test. Filelate If you paid foreign tax on the income earned abroad, you may be able to claim that tax as a deduction or as a credit against your U. Filelate S. Filelate tax. Filelate Resident aliens of the United States can qualify for the foreign earned income exclusion, the foreign housing exclusion, or the foreign housing deduction if they meet the requirements of the physical presence test. Filelate Resident aliens who are citizens or nationals of a country with which the United States has an income tax treaty in effect also can qualify under the bona fide residence test. Filelate No. Filelate You cannot exclude any of the income you earned in Country Z because you were not in a foreign country for at least 330 full days as required under the physical presence test. Filelate . Filelate 6) Can a resident alien of the United States qualify for an exclusion or deduction under the bona fide residence test or the physical presence test? Resident aliens of the United States can qualify for the foreign earned income exclusion, the foreign housing exclusion, or the foreign housing deduction if they meet the requirements of the physical presence test. Filelate Resident aliens who are citizens or nationals of a country with which the United States has an income tax treaty in effect also can qualify under the bona fide residence test. Filelate No. Filelate You cannot exclude any of the income you earned in Country Z because you were not in a foreign country for at least 330 full days as required under the physical presence test. Filelate . Filelate 7) On August 13 of last year I left the United States and arrived in Country Z to work for the Gordon Manufacturing Company. Filelate I expected to be able to exclude my foreign earned income under the physical presence test because I planned to be in Country Z for at least 1 year. Filelate However, I was reassigned back to the United States and left Country Z on July 1 of this year. Filelate Can I exclude any of my foreign earned income? No. Filelate You cannot exclude any of the income you earned in Country Z because you were not in a foreign country for at least 330 full days as required under the physical presence test. Filelate 3. Filelate Foreign Earned Income . Filelate 1) I am an employee of the U. Filelate S. Filelate Government working abroad. Filelate Can all or part of my government income earned abroad qualify for the foreign earned income exclusion? . Filelate 2) I qualify for the foreign earned income exclusion under the bona fide residence test. Filelate Does my foreign earned income include my U. Filelate S. Filelate dividends and the interest I receive on a foreign bank account? . Filelate 3) My company pays my foreign income tax on my foreign earnings. Filelate Is this taxable compensation? . Filelate 4) I live in an apartment in a foreign city for which my employer pays the rent. Filelate Should I include in my income the cost to my employer ($1,200 a month) or the fair market value of equivalent housing in the United States ($800 a month)? . Filelate 5) My U. Filelate S. Filelate employer pays my salary into my U. Filelate S. Filelate bank account. Filelate Is this income considered earned in the United States or is it considered foreign earned income? . Filelate 6) What is considered a foreign country? . Filelate 7) What is the source of earned income? . Filelate 1) I am an employee of the U. Filelate S. Filelate Government working abroad. Filelate Can all or part of my government income earned abroad qualify for the foreign earned income exclusion? No. Filelate The foreign earned income exclusion applies to your foreign earned income. Filelate Amounts paid by the United States or its agencies to their employees are not treated, for this purpose, as foreign earned income. Filelate No. Filelate The only income that is foreign earned income is income from the performance of personal services abroad. Filelate Investment income is not earned income. Filelate However, you must include it in gross income reported on your Form 1040. Filelate Yes. Filelate The amount is compensation for services performed. Filelate The tax paid by your company should be reported on Form 1040, line 7, and on Form 2555, Part IV, line 22(f) (or on Form 2555-EZ, Part IV, line 17). Filelate You must include in income the fair market value (FMV) of the facility provided, where it is provided. Filelate This will usually be the rent your employer pays. Filelate Situations when the FMV is not included in income are discussed in chapter 4 under Exclusion of Meals and Lodging. Filelate If you performed the services to earn this salary outside the United States, your salary is considered earned abroad. Filelate It does not matter that you are paid by a U. Filelate S. Filelate employer or that your salary is deposited in a U. Filelate S. Filelate bank account in the United States. Filelate The source of salary, wages, commissions, and other personal service income is the place where you perform the services. Filelate For the purposes of the foreign earned income exclusion and the foreign housing exclusion or deduction, any territory under the sovereignty of a countr
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Filelate 5. Filelate   Manufacturers Taxes Table of Contents Importer. Filelate Use considered sale. Filelate Lease considered sale. Filelate Bonus goods. Filelate Taxable Event ExemptionsRequirements for Exempt Sales Credits or Refunds Sport Fishing EquipmentRelated person. Filelate Bows, Quivers, Broadheads, and Points Arrow ShaftsExemption for certain wooden arrows. Filelate CoalExported. Filelate Taxable TiresQualifying intercity or local bus. Filelate Qualifying school bus. Filelate Gas Guzzler TaxVehicles not subject to tax. Filelate Imported automobiles. Filelate VaccinesConditions to allowance. Filelate Taxable Medical Devices The following discussion of manufacturers taxes applies to the tax on: Sport fishing equipment; Fishing rods and fishing poles; Electric outboard motors; Fishing tackle boxes; Bows, quivers, broadheads, and points; Arrow shafts; Coal; Taxable tires; Gas guzzler automobiles; and Vaccines. Filelate Manufacturer. Filelate   The term “manufacturer” includes a producer or importer. Filelate A manufacturer is any person who produces a taxable article from new or raw material, or from scrap, salvage, or junk material, by processing or changing the form of an article or by combining or assembling two or more articles. Filelate If you furnish the materials and keep title to those materials and to the finished article, you are considered the manufacturer even though another person actually manufactures the taxable article. Filelate   A manufacturer who sells a taxable article in knockdown (unassembled) condition is liable for the tax. Filelate The person who buys these component parts and assembles a taxable article may also be liable for tax as a further manufacturer depending on the labor, material, and overhead required to assemble the completed article if the article is assembled for business use. Filelate Importer. Filelate   An importer is a person who brings a taxable article into the United States, or withdraws a taxable article from a customs bonded warehouse for sale or use in the United States. Filelate Sale. Filelate   A sale is the transfer of the title to, or the substantial incidents of ownership in, an article to a buyer for consideration that may consist of money, services, or other things. Filelate Use considered sale. Filelate   A manufacturer who uses a taxable article is liable for the tax in the same manner as if it were sold. Filelate Lease considered sale. Filelate   The lease of an article (including any renewal or extension of the lease) by the manufacturer is generally considered a taxable sale. Filelate However, for the gas guzzler tax, only the first lease (excluding any renewal or extension) of the automobile by the manufacturer is considered a sale. Filelate Manufacturers taxes based on sale price. Filelate   The manufacturers taxes imposed on the sale of sport fishing equipment, electric outboard motors, and bows are based on the sale price of the article. Filelate The taxes imposed on coal are based either on the sale price or the weight. Filelate   The price for which an article is sold includes the total consideration paid for the article, whether that consideration is in the form of money, services, or other things. Filelate However, you include certain charges made when a taxable article is sold and you exclude others. Filelate To figure the price on which you base the tax, use the following rules. Filelate Include both the following charges in the price. Filelate Any charge for coverings or containers (regardless of their nature). Filelate Any charge incident to placing the article in a condition packed ready for shipment. Filelate Exclude all the following amounts from the price. Filelate The manufacturers excise tax, whether or not it is stated as a separate charge. Filelate The transportation charges pursuant to the sale. Filelate The cost of transportation of goods to a warehouse before their bona fide sale is not excludable. Filelate Delivery, insurance, installation, retail dealer preparation charges, and other charges you incur in placing the article in the hands of the purchaser under a bona fide sale. Filelate Discounts, rebates, and similar allowances actually granted to the purchaser. Filelate Local advertising charges. Filelate A charge made separately when the article is sold and that qualifies as a charge for “local advertising” may, within certain limits, be excluded from the sale price. Filelate Charges for warranty paid at the purchaser's option. Filelate However, a charge for a warranty of an article that the manufacturer requires the purchaser to pay to obtain the article is included in the sale price on which the tax is figured. Filelate Bonus goods. Filelate   Allocate the sale price if you give free nontaxable goods with the purchase of taxable merchandise. Filelate Figure the tax only on the sale price attributable to the taxable articles. Filelate Example. Filelate A manufacturer sells a quantity of taxable articles and gives the purchaser certain nontaxable articles as a bonus. Filelate The sale price of the shipment is $1,500. Filelate The normal sale price is $2,000: $1,500 for the taxable articles and $500 for the nontaxable articles. Filelate Since the taxable items represent 75% of the normal sale price, the tax is based on 75% of the actual sale price, or $1,125 (75% of $1,500). Filelate The remaining $375 is allocated to the nontaxable articles. Filelate Taxable Event Tax attaches when the title to the article sold passes from the manufacturer to the buyer. Filelate When the title passes depends on the intention of the parties as gathered from the contract of sale. Filelate In the absence of expressed intention, the legal rules of presumption followed in the jurisdiction where the sale occurs determine when title passes. Filelate If the taxable article is used by the manufacturer, the tax attaches at the time use begins. Filelate The manufacturer is liable for the tax. Filelate Partial payments. Filelate   The tax applies to each partial payment received when taxable articles are: Leased, Sold conditionally, Sold on installment with chattel mortgage, or Sold on installment with title to pass in the future. Filelate To figure the tax, multiply the partial payment by the tax rate in effect at the time of the payment. Filelate Exemptions The following sales by the manufacturer are exempt from the manufacturers tax. Filelate Sale of an article to a state or local government for the exclusive use of the state or local government. Filelate This exemption does not apply to the taxes on coal, gas guzzlers, and vaccines. Filelate State is defined in Definitions in chapter 1. Filelate Sale of an article to a nonprofit educational organization for its exclusive use. Filelate This exemption does not apply to the taxes on coal, gas guzzlers, and vaccines. Filelate Nonprofit educational organization is defined under Communications Tax in chapter 4. Filelate Sale of an article to a qualified blood collector organization. Filelate This exemption does not apply to gas guzzlers, recreational equipment, and vaccines. Filelate Qualified blood collector organizations are defined under Communications Tax in chapter 4. Filelate Sale of an article for use by the purchaser as supplies for vessels. Filelate This exemption does not apply to the taxes on coal and vaccines. Filelate Supplies for vessels means ships' stores, sea stores, or legitimate equipment on vessels of war of the United States or any foreign nation, vessels employed in the fisheries or whaling business, or vessels actually engaged in foreign trade. Filelate Sale of an article for use by the purchaser for further manufacture, or for resale by the purchaser to a second purchaser for use by the second purchaser for further manufacture. Filelate This exemption does not apply to the tax on coal and tires. Filelate Use for further manufacture means use in the manufacture or production of an article subject to the manufacturers excise taxes. Filelate If you buy articles tax free and resell or use them other than in the manufacture of another article, you are liable for the tax on their resale or use just as if you had manufactured and sold them. Filelate Sale of an article for export or for resale by the purchaser to a second purchaser for export. Filelate The article may be exported to a foreign country or to a possession of the United States. Filelate A vaccine shipped to a possession of the United States is not considered to be exported. Filelate If an article is sold tax free for export and the manufacturer does not receive proof of export, described later, the manufacturer is liable for the tax. Filelate Sales of articles of native Indian handicraft, such as bows and arrow shafts, manufactured by Indians on reservations, in Indian schools, or under U. Filelate S. Filelate jurisdiction in Alaska. Filelate For tire exemptions, see section 4221(e)(2). Filelate Requirements for Exempt Sales The following requirements must be met for a sale to be exempt from the manufacturers tax. Filelate Registration requirements. Filelate   The manufacturer, first purchaser, and second purchaser in the case of resales must be registered. Filelate See the Form 637 instructions for more information. Filelate Exceptions to registration requirements. Filelate   Registration is not required for: State or local governments, Foreign purchasers of articles sold or resold for export, The United States, or Parties to a sale of supplies for vessels and aircraft. Filelate Certification requirement. Filelate   If the purchaser is required to be registered, the purchaser must give the manufacturer its registration number and certify the exempt purpose for which the article will be used. Filelate The information must be in writing and may be noted on the purchase order or other document furnished by the purchaser to the seller in connection with the sale. Filelate   For a sale to a state or local government, an exemption certificate must be signed by an officer or employee authorized by the state or local government. Filelate See Regulations section 48. Filelate 4221-5(c) for the certificate requirements. Filelate   For sales for use as supplies for vessels and aircraft, if the manufacturer and purchaser are not registered, the owner or agent of the vessel must provide an exemption certificate to the manufacturer before or at the time of sale. Filelate See Regulations section 48. Filelate 4221-4(d) for the certificate requirements. Filelate Proof of export requirement. Filelate   Within 6 months of the date of sale or shipment by the manufacturer, whichever is earlier, the manufacturer must receive proof of exportation. Filelate See Regulations section 48. Filelate 4221-3(d) for evidence that qualifies as proof of exportation. Filelate Proof of resale for further manufacture requirement. Filelate   Within 6 months of the date of sale or shipment by the manufacturer, whichever is earlier, the manufacturer must receive proof that the article has been resold for use in further manufacture. Filelate See Regulations section 48. Filelate 4221-2(c) for evidence that qualifies as proof of resale. Filelate Information to be furnished to purchaser. Filelate   The manufacturer must indicate to the purchaser that the articles normally would be subject to tax and are being sold tax free for an exempt purpose because the purchaser has provided the required certificate. Filelate Credits or Refunds The manufacturer may be eligible to obtain a credit or refund of the manufacturers tax for certain uses, sales, exports, and price readjustments. Filelate The claim must set forth in detail the facts upon which the claim is based. Filelate Uses, sales, and exports. Filelate   A credit or refund (without interest) of the manufacturers taxes may be allowable if a tax-paid article is, by any person: Exported, Used or sold for use as supplies for vessels (except for coal and vaccines), Sold to a state or local government for its exclusive use (except for coal, gas guzzlers, and vaccines), Sold to a nonprofit educational organization for its exclusive use (except for coal, gas guzzlers, and vaccines), Sold to a qualified blood collector organization for its exclusive use (except for gas guzzlers, recreational equipment, and vaccines), or Used for further manufacture of another article subject to the manufacturers taxes (except for coal). Filelate Export. Filelate   If a tax-paid article is exported, the exporter or shipper may claim a credit or refund if the manufacturer waives its right to claim the credit or refund. Filelate In the case of a tax-paid article used to make another taxable article, the subsequent manufacturer may claim the credit or refund. Filelate Price readjustments. Filelate   In addition, a credit or refund (without interest) may be allowable for a tax-paid article for which the price is readjusted by reason of return or repossession of the article or a bona fide discount, rebate, or allowance for taxes based on price. Filelate Conditions to allowance. Filelate   To claim a credit or refund in the case of export; supplies for vessels; or sales to a state or local government, nonprofit educational organization, or qualified blood collector organization; the person who paid the tax must certify on the claim that one of the following applies and that the claimant has the required supporting information. Filelate The claimant sold the article at a tax-excluded price. Filelate The person has repaid, or agreed to repay, the tax to the ultimate vendor of the article. Filelate The person has obtained the written consent of the ultimate vendor to make the claim. Filelate The ultimate vendor generally is the seller making the sale that gives rise to the overpayment of tax. Filelate Claim for further manufacture. Filelate   To claim a credit or refund for further manufacture, the claimant must include a statement that contains the following. Filelate The name and address of the manufacturer and the date of payment. Filelate An identification of the article for which the credit or refund is claimed. Filelate The amount of tax paid on the article and the date on which it was paid. Filelate Information indicating that the article was used as material in the manufacture or production of, or as a component part of, a second article manufactured or produced by the manufacturer, or was sold on or in connection with, or with the sale of a second article manufactured or produced by the manufacturer. Filelate An identification of the second article. Filelate   For claims by the exporter or shipper, the claim must contain the proof of export and a statement signed by the person that paid the tax waiving the right to claim a credit or refund. Filelate The statement must include the amount of tax paid, the date of payment, and the office to which it was paid. Filelate Claim for price readjustment. Filelate   To claim a credit or refund for a price readjustment, the person who paid the tax must include with the claim, a statement that contains the following. Filelate A description of the circumstances that gave rise to the price readjustment. Filelate An identification of the article whose price was readjusted. Filelate The price at which the article was sold. Filelate The amount of tax paid on the article and the date on which it was paid. Filelate The name and address of the purchaser. Filelate The amount repaid to the purchaser or credited to the purchaser's account. Filelate Sport Fishing Equipment A tax of 10% of the sale price is imposed on many articles of sport fishing equipment sold by the manufacturer. Filelate This includes any parts or accessories sold on or in connection with the sale of those articles. Filelate Pay this tax with Form 720. Filelate No tax deposits are required. Filelate Sport fishing equipment includes all the following items. Filelate Fishing rods and poles (and component parts), fishing reels, fly fishing lines, and other fishing lines not over 130 pounds test, fishing spears, spear guns, and spear tips. Filelate Items of terminal tackle, including leaders, artificial lures, artificial baits, artificial flies, fishing hooks, bobbers, sinkers, snaps, drayles, and swivels (but not including natural bait or any item of terminal tackle designed for use and ordinarily used on fishing lines not described in (1)). Filelate The following items of fishing supplies and accessories: fish stringers, creels, bags, baskets, and other containers designed to hold fish, portable bait containers, fishing vests, landing nets, gaff hooks, fishing hook disgorgers, and dressing for fishing lines and artificial flies. Filelate Fishing tip-ups and tilts. Filelate Fishing rod belts, fishing rodholders, fishing harnesses, fish fighting chairs, fishing outriggers, and fishing downriggers. Filelate See Revenue Ruling 88-52 in Cumulative Bulletin 1988-1 for a more complete description of the items of taxable equipment. Filelate Fishing rods and fishing poles. Filelate   The tax on fishing rods and fishing poles (and component parts) is 10% of the sales price not to exceed $10 per article. Filelate The tax is paid by the manufacturer, producer, or importer. Filelate Fishing tackle boxes. Filelate   The tax on fishing tackle boxes is 3% of the sales price. Filelate The tax is paid by the manufacturer, producer, or importer. Filelate Electric outboard boat motors. Filelate   A tax of 3% of the sale price is imposed on the sale by the manufacturer of electric outboard motors. Filelate This includes any parts or accessories sold on or in connection with the sale of those articles. Filelate Certain equipment resale. Filelate   The tax on the sale of sport fishing equipment is imposed a second time under the following circumstances. Filelate If the manufacturer sells a taxable article to any person, the manufacturer is liable for the tax. Filelate If the purchaser or any other person then sells it to a person who is related (discussed next) to the manufacturer, that related person is liable for a second tax on any subsequent sale of the article. Filelate The second tax, however, is not imposed if the constructive sale price rules under section 4216(b) apply to the sale by the manufacturer. Filelate   If the second tax is imposed, a credit for tax previously paid by the manufacturer is available provided the related person can document the tax paid. Filelate The documentation requirement is generally satisfied only through submission of copies of actual records of the person that previously paid the tax. Filelate Related person. Filelate   For the tax on sport fishing equipment, a person is a related person of the manufacturer if that person and the manufacturer have a relationship described in section 465(b)(3)(C). Filelate Bows, Quivers, Broadheads, and Points The tax on bows is 11% (. Filelate 11) of the sales price. Filelate The tax is paid by the manufacturer, producer, or importer. Filelate It applies to bows having a peak draw weight of 30 pounds or more. Filelate The tax is also imposed on the sale of any part or accessory suitable for inclusion in or attachment to a taxable bow and any quiver, broadhead, or point suitable for use with arrows described below. Filelate Pay this tax with Form 720. Filelate No tax deposits are required. Filelate Arrow Shafts The tax on arrow shafts is listed on Form 720. Filelate The tax is paid by the manufacturer, producer, or importer of any arrow shaft (whether sold separately or incorporated as part of a finished or unfinished product) of a type used in the manufacture of any arrow that after its assembly meets either of the following conditions. Filelate It measures 18 inches or more in overall length. Filelate It measures less than 18 inches in overall length but is suitable for use with a taxable bow, described earlier. Filelate Exemption for certain wooden arrows. Filelate   After October 3, 2008, the tax does not apply to any shaft made of all natural wood with no laminations or artificial means of enhancing the spine of such shaft (whether sold separately or incorporated as part of a finished or unfinished product) and used in the manufacture of any arrow that after its assembly meets both of the following conditions. Filelate It measures 5/16 of an inch or less in diameter. Filelate It is not suitable for use with a taxable bow, described earlier. Filelate Pay this tax with Form 720. Filelate No tax deposits are required. Filelate Coal A tax is imposed on the first sale of coal mined in the United States. Filelate The producer of the coal is liable for the tax. Filelate The producer is the person who has vested ownership of the coal under state law immediately after the coal is severed from the ground. Filelate Determine vested ownership without regard to any contractual arrangement for the sale or other disposition of the coal or the payment of any royalties between the producer and third parties. Filelate A producer includes any person who extracts coal from coal waste refuse piles (or from the silt waste product that results from the wet washing of coal). Filelate The tax is not imposed on coal extracted from a riverbed by dredging if it can be shown that the coal has been taxed previously. Filelate Tax rates. Filelate   The tax on underground-mined coal is the lower of: $1. Filelate 10 a ton, or 4. Filelate 4% of the sale price. Filelate   The tax on surface-mined coal is the lower of: 55 cents a ton, or 4. Filelate 4% of the sale price. Filelate   Coal will be taxed at the 4. Filelate 4% rate if the selling price is less than $25 a ton for underground-mined coal and less than $12. Filelate 50 a ton for surface-mined coal. Filelate Apply the tax proportionately if a sale or use includes a portion of a ton. Filelate Example. Filelate If you sell 21,000 pounds (10. Filelate 5 tons) of coal from an underground mine for $525, the price per ton is $50. Filelate The tax is $1. Filelate 10 × 10. Filelate 5 tons ($11. Filelate 55). Filelate Coal production. Filelate   Coal is produced from surface mines if all geological matter (trees, earth, rock) above the coal is removed before the coal is mined. Filelate Treat coal removed by auger and coal reclaimed from coal waste refuse piles as produced from a surface mine. Filelate   Treat coal as produced from an underground mine when the coal is not produced from a surface mine. Filelate In some cases, a single mine may yield coal from both surface mining and underground mining. Filelate Determine if the coal is from a surface mine or an underground mine for each ton of coal produced and not on a mine-by-mine basis. Filelate Determining tonnage or selling price. Filelate   The producer pays the tax on coal at the time of sale or use. Filelate In figuring the selling price for applying the tax, the point of sale is f. Filelate o. Filelate b. Filelate (free on board) mine or f. Filelate o. Filelate b. Filelate cleaning plant if you clean the coal before selling it. Filelate This applies even if you sell the coal for a delivered price. Filelate The f. Filelate o. Filelate b. Filelate mine or f. Filelate o. Filelate b. Filelate cleaning plant is the point at which you figure the number of tons sold for applying the applicable tonnage rate, and the point at which you figure the sale price for applying the 4. Filelate 4% rate. Filelate   The tax applies to the full amount of coal sold. Filelate However, the IRS allows a calculated reduction of the taxable weight of the coal for the weight of the moisture in excess of the coal's inherent moisture content. Filelate Include in the sale price any additional charge for a freeze-conditioning additive in figuring the tax. Filelate   Do not include in the sales price the excise tax imposed on coal. Filelate Coal used by the producer. Filelate   The tax on coal applies if the coal is used by the producer in other than a mining process. Filelate A mining process means the same for this purpose as for percentage depletion. Filelate For example, the tax does not apply if, before selling the coal, you break it, clean it, size it, or apply any other process considered mining under the rules for depletion. Filelate In this case, the tax applies only when you sell the coal. Filelate The tax does not apply to coal used as fuel in the coal drying process since it is considered to be used in a mining process. Filelate However, the tax does apply when you use the coal as fuel or as an ingredient in making coke since the coal is not used in a mining process. Filelate   You must use a constructive sale price to figure the tax under the 4. Filelate 4% rate if you use the coal in other than a mining process. Filelate Base your constructive sale price on sales of a like kind and grade of coal by you or other producers made f. Filelate o. Filelate b. Filelate mine or cleaning plant. Filelate Normally, you use the same constructive price used to figure your percentage depletion deduction. Filelate Blending. Filelate   If you blend surface-mined coal with underground-mined coal during the cleaning process, you must figure the excise tax on the sale of the blended, cleaned coal. Filelate Figure the tax separately for each type of coal in the blend. Filelate Base the tax on the amount of each type in the blend if you can determine the proportion of each type of coal contained in the final blend. Filelate Base the tax on the ratio of each type originally put into the cleaning process if you cannot determine the proportion of each type of coal in the blend. Filelate However, the tax is limited to 4. Filelate 4% of the sale price per ton of the blended coal. Filelate Exemption from tax. Filelate   The tax does not apply to sales of lignite and imported coal. Filelate The only other exemption from the tax on the sale of coal is for coal exported as discussed next. Filelate Exported. Filelate   The tax does not apply to the sale of coal if the coal is in the stream of export when sold by the producer and the coal is actually exported. Filelate   Coal is in the stream of export when sold by the producer if the sale is a step in the exportation of the coal to its ultimate destination in a foreign country. Filelate For example, coal is in the stream of export when: The coal is loaded on an export vessel and title is transferred from the producer to a foreign purchaser, or The producer sells the coal to an export broker in the United States under terms of a contract showing that the coal is to be shipped to a foreign country. Filelate   Proof of export includes any of the following items. Filelate A copy of the export bill of lading issued by the delivering carrier. Filelate A certificate signed by the export carrier's agent or representative showing actual exportation of the coal. Filelate A certificate of landing signed by a customs officer of the foreign country to which the coal is exported. Filelate If the foreign country does not have a customs administrator, a statement of the foreign consignee showing receipt of the coal. Filelate Taxable Tires Taxable tires are divided into three categories for reporting and figuring the tax as described below. Filelate A tax is imposed on taxable tires sold by the manufacturer, producer, or importer at the rate of $. Filelate 0945 ($. Filelate 04725 in the case of a biasply tire or super single tire) for each 10 pounds of the maximum rated load capacity over 3,500 pounds. Filelate The three categories for reporting the tax and the tax rate are listed below. Filelate Taxable tires other than biasply or super single tires at $. Filelate 0945. Filelate Taxable tires, biasply or super single tires (other than super single tires designed for steering) at $. Filelate 04725. Filelate Taxable tires, super single tires designed for steering at $. Filelate 0945. Filelate A taxable tire is any tire of the type used on highway vehicles if wholly or partially made of rubber and if marked according to federal regulations for highway use. Filelate A biasply tire is a pneumatic tire on which the ply cords that extend to the beads are laid at alternate angles substantially less than 90 degrees to the centerline of the tread. Filelate A super single tire is a tire greater than 13 inches in cross section width designed to replace 2 tires in a dual fitment. Filelate Special rule, manufacturer's retail stores. Filelate   The excise tax on taxable tires is imposed at the time the taxable tires are delivered to the manufacturer-owned retail stores, not at the time of sale. Filelate Tires on imported articles. Filelate   The importer of an article equipped with taxable tires is treated as the manufacturer of the tires and is liable for the taxable tire excise tax when the article is sold (except in the case of an automobile bus chassis or body with tires). Filelate Tires exempt from tax. Filelate   The tax on taxable tires does not apply to the following items. Filelate Domestically recapped or retreaded tires if the tires have been sold previously in the United States and were taxable tires at the time of sale. Filelate Tire carcasses not suitable for commercial use. Filelate Tires for use on qualifying intercity, local, and school buses. Filelate For tax-free treatment, the registration requirements discussed earlier under Requirements for Exempt Sales apply. Filelate Tires sold for the exclusive use of the Department of Defense or the Coast Guard. Filelate Tires of a type used exclusively on mobile machinery. Filelate A taxable tire used on mobile machinery is not exempt from tax. Filelate Qualifying intercity or local bus. Filelate   This is any bus used mainly (more than 50%) to transport the general public for a fee and that either operates on a schedule along regular routes or seats at least 20 adults (excluding the driver). Filelate Qualifying school bus. Filelate   This is any bus substantially all the use (85% or more) of which is to transport students and employees of schools. Filelate Credit or refund. Filelate   A credit or refund (without interest) is allowable on tax-paid tires if the tires have been: Exported; Sold to a state or local government for its exclusive use; Sold to a nonprofit educational organization for its exclusive use (as defined under Communications Tax in chapter 4); Sold to a qualified blood collector organization (as defined under Communications Tax in chapter 4) for its exclusive use in connection with a vehicle the organization certifies will be primarily used in the collection, storage, or transportation of blood; Used or sold for use as supplies for vessels; or Sold in connection with qualified intercity, local, or school buses. Filelate   Also, a credit or refund (without interest) is allowable on tax-paid tires sold by any person on, or in connection with, any other article that is sold or used in an activity listed above. Filelate   The person who paid the tax is eligible to make the claim. Filelate Gas Guzzler Tax Tax is imposed on the sale by the manufacturer of automobiles of a model type that has a fuel economy standard as measured by the Environmental Protection Agency (EPA) of less than 22. Filelate 5 miles per gallon. Filelate If you import an automobile for personal use, you may be liable for this tax. Filelate Figure the tax on Form 6197, as discussed later. Filelate The tax rate is based on fuel economy rating. Filelate The tax rates for the gas guzzler tax are shown on Form 6197. Filelate A person that lengthens an existing automobile is the manufacturer of an automobile. Filelate Automobiles. Filelate   An automobile (including limousines) means any four-wheeled vehicle that is: Rated at an unloaded gross vehicle weight of 6,000 pounds or less, Propelled by an engine powered by gasoline or diesel fuel, and Intended for use mainly on public streets, roads, and highways. Filelate Vehicles not subject to tax. Filelate   For the gas guzzler tax, the following vehicles are not considered automobiles. Filelate Limousines with a gross unloaded vehicle weight of more than 6,000 pounds. Filelate Vehicles operated exclusively on a rail or rails. Filelate Vehicles sold for use and used primarily: As ambulances or combination ambulance-hearses, For police or other law enforcement purposes by federal, state, or local governments, or For firefighting purposes. Filelate Vehicles treated under 49 U. Filelate S. Filelate C. Filelate 32901 (1978) as non-passenger automobiles. Filelate This includes limousines manufactured primarily to transport more than 10 persons. Filelate   The manufacturer can sell a vehicle described in item (3) tax free only when the sale is made directly to a purchaser for the described emergency use and the manufacturer and purchaser (other than a state or local government) are registered. Filelate   Treat an Indian tribal government as a state only if the police or other law enforcement purposes are an essential tribal government function. Filelate Model type. Filelate   Model type is a particular class of automobile as determined by EPA regulations. Filelate Fuel economy. Filelate   Fuel economy is the average number of miles an automobile travels on a gallon of gasoline (or diesel fuel) rounded to the nearest 0. Filelate 1 mile as figured by the EPA. Filelate Imported automobiles. Filelate   The tax also applies to automobiles that do not have a prototype-based fuel economy rating assigned by the EPA. Filelate An automobile imported into the United States without a certificate of conformity to United States emission standards and that has no assigned fuel economy rating must be either: Converted by installation of emission controls to conform in all material respects to an automobile already certified for sale in the United States, or Modified by installation of emission control components and individually tested to demonstrate emission compliance. Filelate   An imported automobile that has been converted to conform to an automobile already certified for sale in the United States may use the fuel economy rating assigned to that certified automobile. Filelate   A fuel economy rating is not generally available for modified imported automobiles because the EPA does not require a highway fuel economy test on them. Filelate A separate highway fuel economy test would be required to devise a fuel economy rating (otherwise the automobile is presumed to fall within the lowest fuel economy rating category). Filelate   For more information about fuel economy ratings for imported automobiles, see Revenue Ruling 86-20 and Revenue Procedure 86-9 in Cumulative Bulletin 1986-1, and Revenue Procedure 87-10 in Cumulative Bulletin 1987-1. Filelate Exemptions. Filelate   No one is exempt from the gas guzzler tax, including the federal government, state and local governments, qualified blood collector organizations, and nonprofit educational organizations. Filelate However, see Vehicles not subject to tax, earlier. Filelate Form 6197. Filelate   Use Form 6197 to figure your tax liability for each quarter. Filelate Attach Form 6197 to your Form 720 for the quarter. Filelate See the Form 6197 instructions for more information and the one-time filing rules. Filelate Credit or refund. Filelate   If the manufacturer paid the tax on a vehicle that is used or resold for an emergency use (see item (3) under Vehicles not subject to tax), the manufacturer can claim a credit or refund. Filelate For information about how to file for credits or refunds, see the Instructions for Form 720 or Form 8849. Filelate Vaccines Tax is imposed on certain vaccines sold by the manufacturer in the United States. Filelate A taxable vaccine means any of the following vaccines. Filelate Any vaccine containing diphtheria toxoid. Filelate Any vaccine containing tetanus toxoid. Filelate Any vaccine containing pertussis bacteria, extracted or partial cell bacteria, or specific pertussis antigens. Filelate Any vaccine containing polio virus. Filelate Any vaccine against measles. Filelate Any vaccine against mumps. Filelate Any vaccine against rubella. Filelate Any vaccine against hepatitis A. Filelate Any vaccine against hepatitis B. Filelate Any vaccine against chicken pox. Filelate Any vaccine against rotavirus gastroenteritis. Filelate Any HIB vaccine. Filelate Any conjugate vaccine against streptococcus pneumoniae. Filelate Any trivalent vaccine against influenza or any other vaccine against influenza. Filelate Any meningococcal vaccine. Filelate Any vaccine against the human papillomavirus. Filelate The effective date for the tax on any vaccine against influenza, other than trivalent influenza vaccines, is the later of August 1, 2013, or the date the Secretary of Health and Human Services lists a vaccine against seasonal influenza for purposes of compensation for any vaccine-related injury or death through the Vaccine Injury Compensation Trust Fund. Filelate The tax is $. Filelate 75 per dose of each taxable vaccine. Filelate The tax per dose on a vaccine that contains more than one taxable vaccine is $. Filelate 75 times the number of taxable vaccines. Filelate Taxable use. Filelate   Any manufacturer (including a governmental entity) that uses a taxable vaccine before it is sold will be liable for the tax in the same manner as if the vaccine was sold by the manufacturer. Filelate Credit or refund. Filelate   A credit or refund (without interest) is available if the vaccine is: Returned to the person who paid the tax (other than for resale), or Destroyed. Filelate The claim for a credit or refund must be filed within 6 months after the vaccine is returned or destroyed. Filelate Conditions to allowance. Filelate   To claim a credit or refund, the person who paid the tax must have repaid or agreed to repay the tax to the ultimate purchaser of the vaccine or obtained the written consent of such purchaser to allowance of the credit or refund. Filelate Taxable Medical Devices Taxable medical devices. Filelate   The tax on the sale of certain medical devices by the manufacturer, producer, or importer of the device is 2. Filelate 3% (. Filelate 023) of the sales price. Filelate A taxable medical device is a device that is listed as a device with the Food and Drug Administration (FDA) under section 510(j) of the Federal Food, Drug, and Cosmetic Act and 21 CFR part 807, pursuant to FDA requirements. Filelate There are specific exemptions for eyeglasses, contact lenses, and hearing aids. Filelate There is also an exemption for devices that are determined by the Secretary to be of a type that are generally purchased by the general public at retail for individual use (this exemption is known as the retail exemption). Filelate See T. Filelate D. Filelate 9604 for information on how to determine whether a device falls within the retail exemption, and examples of how a taxpayer might evaluate a given device. Filelate More information. Filelate   For more information on the medical device tax, see section 4191, T. Filelate D. Filelate 9604, and Notice 2012-77. Filelate You can find T. Filelate D. Filelate 9604 and Notice 2012-77 on pages 730 and 781, respectively, of I. Filelate R. Filelate B. Filelate 2012-52 at www. Filelate irs. Filelate gov/pub/irs-irbs/irb12-52. Filelate pdf. Filelate Prev  Up  Next   Home   More Online Publications