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Form 1040x Fillable

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Form 1040x Fillable

Form 1040x fillable Internal Revenue Bulletin:  2009-17  April 27, 2009  Rev. Form 1040x fillable Proc. Form 1040x fillable 2009-24 Table of Contents SECTION 1. Form 1040x fillable PURPOSE SECTION 2. Form 1040x fillable BACKGROUND SECTION 3. Form 1040x fillable SCOPE SECTION 4. Form 1040x fillable APPLICATION. Form 1040x fillable 01 In General. Form 1040x fillable . Form 1040x fillable 02 Limitations on Depreciation Deductions for Certain Automobiles. Form 1040x fillable . Form 1040x fillable 03 Inclusions in Income of Lessees of Passenger Automobiles. Form 1040x fillable SECTION 5. Form 1040x fillable EFFECTIVE DATE SECTION 6. Form 1040x fillable DRAFTING INFORMATION SECTION 1. Form 1040x fillable PURPOSE . Form 1040x fillable 01 This revenue procedure provides: (1) limitations on depreciation deductions for owners of passenger automobiles first placed in service by the taxpayer during calendar year 2009, including a separate table of limitations on depreciation deductions for trucks and vans; and (2) the amounts to be included in income by lessees of passenger automobiles first leased by the taxpayer during calendar year 2009, including a separate table of inclusion amounts for lessees of trucks and vans. Form 1040x fillable . Form 1040x fillable 02 The tables detailing these depreciation limitations and lessee inclusion amounts reflect the automobile price inflation adjustments required by § 280F(d)(7) of the Internal Revenue Code. Form 1040x fillable SECTION 2. Form 1040x fillable BACKGROUND . Form 1040x fillable 01 For owners of passenger automobiles, § 280F(a) imposes dollar limitations on the depreciation deduction for the year that the passenger automobile is placed in service by the taxpayer and each succeeding year. Form 1040x fillable Section 280F(d)(7) requires the amounts allowable as depreciation deductions to be increased by a price inflation adjustment amount for passenger automobiles placed in service after 1988. Form 1040x fillable The method of calculating this price inflation amount for trucks and vans placed in service in or after calendar year 2003 uses a different CPI “automobile component” (the “new trucks” component) than that used in the price inflation amount calculation for other passenger automobiles (the “new cars” component), resulting in somewhat higher depreciation deductions for trucks and vans. Form 1040x fillable This change reflects the higher rate of price inflation that trucks and vans have been subject to since 1988. Form 1040x fillable . Form 1040x fillable 02 Section 168(k)(1)(A) provides a 50 percent additional first year depreciation deduction for certain new property acquired by a taxpayer after December 31, 2007, and before January 1, 2010, if no written binding contract for the acquisition of the property existed before January 1, 2008. Form 1040x fillable Section 168(k)(2)(F)(i) increases the first year depreciation allowed under § 280F(a)(1)(A) by $8,000 for passenger automobiles to which the 50 percent additional first year depreciation deduction applies. Form 1040x fillable . Form 1040x fillable 03 Section 168(k)(2)(D)(i) provides that the 50 percent additional first year depreciation deduction does not apply to any property required to be depreciated under the alternative depreciation system of § 168(g), including property described in § 280F(b)(1). Form 1040x fillable Section 168(k)(2)(D)(iii) permits a taxpayer to elect to not claim the 50 percent additional first year depreciation deduction for any class of property. Form 1040x fillable Section 168(k)(4) permits a corporation to elect to not claim the 50 percent additional first year depreciation deduction for all eligible qualified property (that is extension property or that is not extension property, as applicable) and instead to increase the business credit limitation under § 38(c) or the alternative minimum tax credit limitation under § 53(c). Form 1040x fillable Accordingly, this revenue procedure provides tables for passenger automobiles for which the 50 percent additional depreciation deduction applies and tables for passenger automobiles for which the 50 percent additional first year depreciation deduction does not apply, including passenger automobiles in a class of property for which the taxpayer “elects out” of the 50 percent additional first year depreciation deduction or passenger automobiles that are eligible qualified property to which the § 168(k)(4) election applies. Form 1040x fillable . Form 1040x fillable 04 For leased passenger automobiles, § 280F(c) requires a reduction in the deduction allowed to the lessee of the passenger automobile. Form 1040x fillable The reduction must be substantially equivalent to the limitations on the depreciation deductions imposed on owners of passenger automobiles. Form 1040x fillable Under § 1. Form 1040x fillable 280F-7(a) of the Income Tax Regulations, this reduction requires a lessee to include in gross income an inclusion amount determined by applying a formula to the amount obtained from a table. Form 1040x fillable One table applies to lessees of trucks and vans and another table applies to all other passenger automobiles. Form 1040x fillable Each table shows inclusion amounts for a range of fair market values for each taxable year after the passenger automobile is first leased. Form 1040x fillable SECTION 3. Form 1040x fillable SCOPE . Form 1040x fillable 01 The limitations on depreciation deductions in section 4. Form 1040x fillable 02(2) of this revenue procedure apply to passenger automobiles (other than leased passenger automobiles) that are placed in service by the taxpayer in calendar year 2009, and continue to apply for each taxable year that the passenger automobile remains in service. Form 1040x fillable . Form 1040x fillable 02 The tables in section 4. Form 1040x fillable 03 of this revenue procedure apply to leased passenger automobiles for which the lease term begins during calendar year 2009. Form 1040x fillable Lessees of these passenger automobiles must use these tables to determine the inclusion amount for each taxable year during which the passenger automobile is leased. Form 1040x fillable See Rev. Form 1040x fillable Proc. Form 1040x fillable 2002-14, 2002-1 C. Form 1040x fillable B. Form 1040x fillable 450, for passenger automobiles first leased before January 1, 2003, Rev. Form 1040x fillable Proc. Form 1040x fillable 2003-75, 2003-2 C. Form 1040x fillable B. Form 1040x fillable 1018, for passenger automobiles first leased during calendar year 2003, Rev. Form 1040x fillable Proc. Form 1040x fillable 2004-20, 2004-1 C. Form 1040x fillable B. Form 1040x fillable 642, for passenger automobiles first leased during calendar year 2004, Rev. Form 1040x fillable Proc. Form 1040x fillable 2005-13, 2005-1 C. Form 1040x fillable B. Form 1040x fillable 759, for passenger automobiles first leased during calendar year 2005, Rev. Form 1040x fillable Proc. Form 1040x fillable 2006-18, 2006-1 C. Form 1040x fillable B. Form 1040x fillable 645, for passenger automobiles first leased during calendar year 2006, Rev. Form 1040x fillable Proc. Form 1040x fillable 2007-30, 2007-1 C. Form 1040x fillable B. Form 1040x fillable 1104, for passenger automobiles first leased during calendar year 2007, and Rev. Form 1040x fillable Proc. Form 1040x fillable 2008-22, 2008-12 I. Form 1040x fillable R. Form 1040x fillable B. Form 1040x fillable 658, for passenger automobiles first leased during calendar year 2008. Form 1040x fillable SECTION 4. Form 1040x fillable APPLICATION . Form 1040x fillable 01 In General. Form 1040x fillable (1) Limitations on depreciation deductions for certain automobiles. Form 1040x fillable The limitations on depreciation deductions for passenger automobiles placed in service by the taxpayer for the first time during calendar year 2009 are in Tables 1 through 4 in section 4. Form 1040x fillable 02(2) of this revenue procedure. Form 1040x fillable (2) Inclusions in income of lessees of passenger automobiles. Form 1040x fillable A taxpayer first leasing a passenger automobile during calendar year 2009 must determine the inclusion amount that is added to gross income using Tables 5 and 6 in section 4. Form 1040x fillable 03 of this revenue procedure. Form 1040x fillable In addition, the taxpayer must follow the procedures of § 1. Form 1040x fillable 280F-7(a). Form 1040x fillable . Form 1040x fillable 02 Limitations on Depreciation Deductions for Certain Automobiles. Form 1040x fillable (1) Amount of the inflation adjustment. Form 1040x fillable (a) Passenger automobiles (other than trucks or vans). Form 1040x fillable Under § 280F(d)(7)(B)(i), the automobile price inflation adjustment for any calendar year is the percentage (if any) by which the CPI automobile component for October of the preceding calendar year exceeds the CPI automobile component for October 1987. Form 1040x fillable The term “CPI automobile component” is defined in § 280F(d)(7)(B)(ii) as the “automobile component” of the Consumer Price Index for all Urban Consumers published by the Department of Labor. Form 1040x fillable The new car component of the CPI was 115. Form 1040x fillable 2 for October 1987 and 134. Form 1040x fillable 837 for October 2008. Form 1040x fillable The October 2008 index exceeded the October 1987 index by 19. Form 1040x fillable 637. Form 1040x fillable The Internal Revenue Service has, therefore, determined that the automobile price inflation adjustment for 2009 for passenger automobiles (other than trucks and vans) is 17. Form 1040x fillable 05 percent (19. Form 1040x fillable 637/115. Form 1040x fillable 2 x 100%). Form 1040x fillable This adjustment is applicable to all passenger automobiles (other than trucks and vans) that are first placed in service in calendar year 2009. Form 1040x fillable The dollar limitations in § 280F(a) therefore must be multiplied by a factor of 0. Form 1040x fillable 1705, and the resulting increases, after rounding to the nearest $100, are added to the 1988 limitations to give the depreciation limitations applicable to passenger automobiles (other than trucks and vans) for calendar year 2009. Form 1040x fillable (b) Trucks and vans. Form 1040x fillable To determine the dollar limitations applicable to trucks and vans first placed in service during calendar year 2009, the new truck component of the CPI is used instead of the new car component. Form 1040x fillable The new truck component of the CPI was 112. Form 1040x fillable 4 for October 1987 and 133. Form 1040x fillable 640 for October 2008. Form 1040x fillable The October 2008 index exceeded the October 1987 index by 21. Form 1040x fillable 24. Form 1040x fillable The Service has, therefore, determined that the automobile price inflation adjustment for 2009 for trucks and vans is 18. Form 1040x fillable 90 percent (21. Form 1040x fillable 24/112. Form 1040x fillable 4 x 100%). Form 1040x fillable This adjustment is applicable to all trucks and vans that are first placed in service in calendar year 2009. Form 1040x fillable The dollar limitations in § 280F(a) therefore must be multiplied by a factor of 0. Form 1040x fillable 1890, and the resulting increases, after rounding to the nearest $100, are added to the 1988 limitations to give the depreciation limitations applicable to trucks and vans. Form 1040x fillable (2) Amount of the limitation. Form 1040x fillable For passenger automobiles placed in service by the taxpayer in calendar year 2009, Tables 1 through 4 contain the dollar amount of the depreciation limitation for each taxable year. Form 1040x fillable Use Table 1 for a passenger automobile (other than a truck or van) placed in service by the taxpayer in calendar year 2009, for which the 50 percent additional first year depreciation deduction does not apply, including a passenger automobile (other than a truck or van) in a class of property for which the taxpayer elects out of the 50 percent additional first year depreciation deduction or a passenger automobile that is eligible qualified property to which the § 168(k)(4) election applies. Form 1040x fillable Use Table 2 for a passenger automobile (other than a truck or van) placed in service by the taxpayer in calendar year 2009, for which the 50 percent additional first year depreciation deduction applies. Form 1040x fillable Use Table 3 for a truck or van placed in service by the taxpayer in calendar year 2009, for which the 50 percent additional first year depreciation deduction does not apply, including a truck or van in a class of property for which the taxpayer elects out of the 50 percent additional first year depreciation deduction or a truck or van that is eligible qualified property to which the § 168(k)(4) election applies. Form 1040x fillable Use Table 4 for a truck or van placed in service by the taxpayer in calendar year 2009, for which the 50 percent additional first year depreciation deduction applies. Form 1040x fillable REV. Form 1040x fillable PROC. Form 1040x fillable 2009-24 TABLE 1 DEPRECIATION LIMITATIONS FOR PASSENGER AUTOMOBILES (THAT ARE NOT TRUCKS OR VANS) PLACED IN SERVICE BY THE TAXPAYER IN CALENDAR YEAR 2009, FOR WHICH THE 50 PERCENT ADDITIONAL FIRST YEAR DEPRECIATION DEDUCTION DOES NOT APPLY Tax Year Amount 1st Tax Year $2,960 2nd Tax Year $4,800 3rd Tax Year $2,850 Each Succeeding Year $1,775 REV. Form 1040x fillable PROC. Form 1040x fillable 2009-24 TABLE 2 DEPRECIATION LIMITATIONS FOR PASSENGER AUTOMOBILES (THAT ARE NOT TRUCKS OR VANS) PLACED IN SERVICE BY THE TAXPAYER IN CALENDAR YEAR 2009, FOR WHICH THE 50 PERCENT ADDITIONAL FIRST YEAR DEPRECIATION DEDUCTION APPLIES Tax Year Amount 1st Tax Year $10,960 2nd Tax Year $4,800 3rd Tax Year $2,850 Each Succeeding Year $1,775 REV. Form 1040x fillable PROC. Form 1040x fillable 2009-24 TABLE 3 DEPRECIATION LIMITATIONS FOR TRUCKS AND VANS PLACED IN SERVICE BY THE TAXPAYER IN CALENDAR YEAR 2009, FOR WHICH THE 50 PERCENT ADDITIONAL FIRST YEAR DEPRECIATION DEDUCTION DOES NOT APPLY Tax Year Amount 1st Tax Year $3,060 2nd Tax Year $4,900 3rd Tax Year $2,950 Each Succeeding Year $1,775 REV. Form 1040x fillable PROC. Form 1040x fillable 2009-24 TABLE 4 DEPRECIATION LIMITATIONS FOR TRUCKS AND VANS PLACED IN SERVICE BY THE TAXPAYER IN CALENDAR YEAR 2009, FOR WHICH THE 50 PERCENT ADDITIONAL FIRST YEAR DEPRECIATION DEDUCTION APPLIES Tax Year Amount 1st Tax Year $11,060 2nd Tax Year $4,900 3rd Tax Year $2,950 Each Succeeding Year $1,775 . Form 1040x fillable 03 Inclusions in Income of Lessees of Passenger Automobiles. Form 1040x fillable The inclusion amounts for passenger automobiles first leased in calendar year 2009 are calculated under the procedures described in § 1. Form 1040x fillable 280F-7(a). Form 1040x fillable Lessees of passenger automobiles other than trucks and vans should use Table 5 of this revenue procedure in applying these procedures, while lessees of trucks and vans should use Table 6 of this revenue procedure. Form 1040x fillable REV. Form 1040x fillable PROC. Form 1040x fillable 2009-24 TABLE 5 DOLLAR AMOUNTS FOR PASSENGER AUTOMOBILES (THAT ARE NOT TRUCKS OR VANS) WITH A LEASE TERM BEGINNING IN CALENDAR YEAR 2009 Fair Market Value of Passenger Automobile Tax Year During Lease Over Not Over 1st 2nd 3rd 4th 5th & Later $18,500 $19,000 9 19 28 34 38 19,000 19,500 10 21 32 38 43 19,500 20,000 11 24 36 42 48 20,000 20,500 12 27 39 46 54 20,500 21,000 13 29 43 51 58 21,000 21,500 15 31 47 55 64 21,500 22,000 16 34 50 60 68 22,000 23,000 17 38 56 66 76 23,000 24,000 20 42 64 75 86 24,000 25,000 22 47 71 84 96 25,000 26,000 24 52 78 93 107 26,000 27,000 26 58 85 101 117 27,000 28,000 29 62 93 110 127 28,000 29,000 31 67 100 119 138 29,000 30,000 33 72 108 128 147 30,000 31,000 35 77 115 137 157 31,000 32,000 38 82 122 146 167 32,000 33,000 40 87 129 155 178 33,000 34,000 42 92 137 163 188 34,000 35,000 44 97 144 172 199 35,000 36,000 47 102 151 181 208 36,000 37,000 49 107 159 189 219 37,000 38,000 51 112 166 199 228 38,000 39,000 53 117 173 208 239 39,000 40,000 56 122 180 216 250 40,000 41,000 58 127 188 225 259 41,000 42,000 60 132 195 234 269 42,000 43,000 62 137 203 242 280 43,000 44,000 65 141 210 252 290 44,000 45,000 67 146 218 260 300 45,000 46,000 69 151 225 269 311 46,000 47,000 71 157 232 278 320 47,000 48,000 74 161 240 286 331 48,000 49,000 76 166 247 296 340 49,000 50,000 78 171 255 304 351 50,000 51,000 80 176 262 313 361 51,000 52,000 83 181 269 322 371 52,000 53,000 85 186 276 331 381 53,000 54,000 87 191 284 339 392 54,000 55,000 89 196 291 349 401 55,000 56,000 92 201 298 357 412 56,000 57,000 94 206 306 365 423 57,000 58,000 96 211 313 375 432 58,000 59,000 98 216 320 384 442 59,000 60,000 101 221 327 393 452 60,000 62,000 104 228 339 406 467 62,000 64,000 109 238 353 424 488 64,000 66,000 113 248 368 441 509 66,000 68,000 118 258 382 459 529 68,000 70,000 122 268 397 476 550 70,000 72,000 127 277 413 493 570 72,000 74,000 131 288 427 511 590 74,000 76,000 136 297 442 529 610 76,000 78,000 140 307 457 546 631 78,000 80,000 145 317 471 564 651 80,000 85,000 152 335 497 595 686 85,000 90,000 164 359 534 639 737 90,000 95,000 175 384 570 683 789 95,000 100,000 186 409 607 727 839 100,000 110,000 203 446 662 793 916 110,000 120,000 226 495 736 881 1,018 120,000 130,000 248 545 809 970 1,119 130,000 140,000 271 594 883 1,058 1,220 140,000 150,000 293 644 956 1,146 1,322 150,000 160,000 316 693 1,030 1,234 1,424 160,000 170,000 338 743 1,103 1,322 1,526 170,000 180,000 361 792 1,177 1,410 1,628 180,000 190,000 383 842 1,250 1,498 1,730 190,000 200,000 406 891 1,324 1,586 1,831 200,000 210,000 428 941 1,397 1,675 1,932 210,000 220,000 451 990 1,471 1,762 2,035 220,000 230,000 473 1,040 1,544 1,851 2,136 230,000 240,000 496 1,089 1,618 1,939 2,238 240,000 And up 518 1,139 1,691 2,027 2,340 REV. Form 1040x fillable PROC. Form 1040x fillable 2009-24 TABLE 6 DOLLAR AMOUNTS FOR TRUCKS AND VANS WITH A LEASE TERM BEGINNING IN CALENDAR YEAR 2009 Fair Market Value of Electric Automobile Tax Year During Lease Over Not Over 1st 2nd 3rd 4th 5th and Later $18,500 $19,000 8 17 25 30 35 19,000 19,500 9 19 29 35 40 19,500 20,000 10 22 33 38 45 20,000 20,500 11 25 36 43 50 20,500 21,000 12 27 40 48 55 21,000 21,500 13 30 43 52 60 21,500 22,000 15 32 47 56 66 22,000 23,000 16 36 52 64 72 23,000 24,000 18 41 60 72 83 24,000 25,000 21 45 68 81 93 25,000 26,000 23 50 75 90 103 26,000 27,000 25 56 82 98 114 27,000 28,000 27 61 89 107 124 28,000 29,000 30 65 97 116 134 29,000 30,000 32 70 104 125 144 30,000 31,000 34 75 112 134 154 31,000 32,000 36 80 119 143 164 32,000 33,000 39 85 126 151 175 33,000 34,000 41 90 134 160 184 34,000 35,000 43 95 141 169 195 35,000 36,000 45 100 148 178 205 36,000 37,000 48 105 155 187 215 37,000 38,000 50 110 163 195 226 38,000 39,000 52 115 170 204 236 39,000 40,000 55 120 177 213 246 40,000 41,000 57 125 185 221 256 41,000 42,000 59 130 192 231 266 42,000 43,000 61 135 199 240 276 43,000 44,000 64 139 207 249 286 44,000 45,000 66 144 215 257 296 45,000 46,000 68 149 222 266 307 46,000 47,000 70 155 229 274 317 47,000 48,000 73 159 237 283 327 48,000 49,000 75 164 244 292 338 49,000 50,000 77 169 251 301 348 50,000 51,000 79 174 259 310 357 51,000 52,000 82 179 266 318 368 52,000 53,000 84 184 273 328 378 53,000 54,000 86 189 281 336 388 54,000 55,000 88 194 288 345 399 55,000 56,000 91 199 295 354 408 56,000 57,000 93 204 302 363 419 57,000 58,000 95 209 310 371 429 58,000 59,000 97 214 317 381 439 59,000 60,000 100 219 324 389 450 60,000 62,000 103 226 336 402 465 62,000 64,000 107 236 351 420 485 64,000 66,000 112 246 365 438 505 66,000 68,000 116 256 380 455 526 68,000 70,000 121 266 394 473 546 70,000 72,000 125 276 409 491 566 72,000 74,000 130 286 423 509 586 74,000 76,000 134 296 438 526 607 76,000 78,000 139 305 454 543 627 78,000 80,000 143 316 467 561 648 80,000 85,000 151 333 493 592 684 85,000 90,000 163 357 531 635 735 90,000 95,000 174 382 567 680 785 95,000 100,000 185 407 604 724 836 100,000 110,000 202 444 659 790 912 110,000 120,000 225 493 733 878 1,014 120,000 130,000 247 543 806 966 1,116 130,000 140,000 270 592 880 1,054 1,218 140,000 150,000 292 642 953 1,143 1,319 150,000 160,000 315 691 1,027 1,230 1,421 160,000 170,000 337 741 1,100 1,319 1,522 170,000 180,000 360 790 1,174 1,407 1,624 180,000 190,000 382 840 1,247 1,495 1,726 190,000 200,000 405 889 1,321 1,583 1,828 200,000 210,000 427 939 1,394 1,671 1,930 210,000 220,000 450 988 1,468 1,759 2,031 220,000 230,000 472 1,038 1,541 1,847 2,134 230,000 240,000 495 1,087 1,615 1,935 2,235 240,000 and up 517 1,137 1,688 2,024 2,336 SECTION 5. Form 1040x fillable EFFECTIVE DATE This revenue procedure applies to passenger automobiles (other than leased passenger automobiles) that are first placed in service by a taxpayer during calendar year 2009, and to leased passenger automobiles that are first leased by a taxpayer during calendar year 2009. Form 1040x fillable SECTION 6. Form 1040x fillable DRAFTING INFORMATION The principal author of this revenue procedure is Bernard P. Form 1040x fillable Harvey of the Office of Associate Chief Counsel (Income Tax & Accounting). Form 1040x fillable For further information regarding this revenue procedure, contact Mr. Form 1040x fillable Harvey at (202) 622-4930 (not a toll-free call). Form 1040x fillable Prev  Up  Next   Home   More Internal Revenue Bulletins
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Susquehanna River Basin Commission

The Susquehanna River Basin Commission is an interstate body, with representatives from New York, Maryland, Pennsylvania and the federal government, that manages the environmental stewardship and economic development of the Susquehanna river and its tributaries.

Contact the Agency or Department

Website: Susquehanna River Basin Commission

E-mail:

Address: 1721 Front St
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Phone Number: (717) 238-0423

The Form 1040x Fillable

Form 1040x fillable 6. Form 1040x fillable   Insurance Table of Contents What's New Introduction Topics - This chapter discusses: Useful Items - You may want to see: Deductible PremiumsSelf-Employed Health Insurance Deduction Nondeductible Premiums Capitalized Premiums When To Deduct Premiums What's New Retiree drug subsidy. Form 1040x fillable  Beginning in 2013, sponsors of certain qualified retiree prescription drug plans must account for the subsidy received by reducing the amount of qualified retiree prescription drug plans expense by the subsidy received (taking into account the taxpayer's accounting method). Form 1040x fillable For more information, see the retiree drug subsidy frequently asked questions on IRS. Form 1040x fillable gov. Form 1040x fillable Introduction You generally can deduct the ordinary and necessary cost of insurance as a business expense if it is for your trade, business, or profession. Form 1040x fillable However, you may have to capitalize certain insurance costs under the uniform capitalization rules. Form 1040x fillable For more information, see Capitalized Premiums , later. Form 1040x fillable Topics - This chapter discusses: Deductible premiums Nondeductible premiums Capitalized premiums When to deduct premiums Useful Items - You may want to see: Publication 15-B Employer's Tax Guide to Fringe Benefits 525 Taxable and Nontaxable Income 538 Accounting Periods and Methods 547 Casualties, Disasters, and Thefts Form (and Instructions) 1040 U. Form 1040x fillable S. Form 1040x fillable Individual Income Tax Return See chapter 12 for information about getting publications and forms. Form 1040x fillable Deductible Premiums You generally can deduct premiums you pay for the following kinds of insurance related to your trade or business. Form 1040x fillable Insurance that covers fire, storm, theft, accident, or similar losses. Form 1040x fillable Credit insurance that covers losses from business bad debts. Form 1040x fillable Group hospitalization and medical insurance for employees, including long-term care insurance. Form 1040x fillable If a partnership pays accident and health insurance premiums for its partners, it generally can deduct them as guaranteed payments to partners. Form 1040x fillable If an S corporation pays accident and health insurance premiums for its more-than-2% shareholder-employees, it generally can deduct them, but must also include them in the shareholder's wages subject to federal income tax withholding. Form 1040x fillable See Publication 15-B. Form 1040x fillable Liability insurance. Form 1040x fillable Malpractice insurance that covers your personal liability for professional negligence resulting in injury or damage to patients or clients. Form 1040x fillable Workers' compensation insurance set by state law that covers any claims for bodily injuries or job-related diseases suffered by employees in your business, regardless of fault. Form 1040x fillable If a partnership pays workers' compensation premiums for its partners, it generally can deduct them as guaranteed payments to partners. Form 1040x fillable If an S corporation pays workers' compensation premiums for its more-than-2% shareholder-employees, it generally can deduct them, but must also include them in the shareholder's wages. Form 1040x fillable Contributions to a state unemployment insurance fund are deductible as taxes if they are considered taxes under state law. Form 1040x fillable Overhead insurance that pays for business overhead expenses you have during long periods of disability caused by your injury or sickness. Form 1040x fillable Car and other vehicle insurance that covers vehicles used in your business for liability, damages, and other losses. Form 1040x fillable If you operate a vehicle partly for personal use, deduct only the part of the insurance premium that applies to the business use of the vehicle. Form 1040x fillable If you use the standard mileage rate to figure your car expenses, you cannot deduct any car insurance premiums. Form 1040x fillable Life insurance covering your officers and employees if you are not directly or indirectly a beneficiary under the contract. Form 1040x fillable Business interruption insurance that pays for lost profits if your business is shut down due to a fire or other cause. Form 1040x fillable Self-Employed Health Insurance Deduction You may be able to deduct premiums paid for medical and dental insurance and qualified long-term care insurance for yourself, your spouse, and your dependents. Form 1040x fillable The insurance can also cover your child who was under age 27 at the end of 2013, even if the child was not your dependent. Form 1040x fillable A child includes your son, daughter, stepchild, adopted child, or foster child. Form 1040x fillable A foster child is any child placed with you by an authorized placement agency or by judgment, decree, or other order of any court of competent jurisdiction. Form 1040x fillable One of the following statements must be true. Form 1040x fillable You were self-employed and had a net profit for the year reported on Schedule C (Form 1040), Profit or Loss From Business; Schedule C-EZ (Form 1040), Net Profit From Business; or Schedule F (Form 1040), Profit or Loss From Farming. Form 1040x fillable You were a partner with net earnings from self-employment for the year reported on Schedule K-1 (Form 1065), Partner's Share of Income, Deductions, Credits, etc. Form 1040x fillable , box 14, code A. Form 1040x fillable You used one of the optional methods to figure your net earnings from self-employment on Schedule SE. Form 1040x fillable You received wages in 2013 from an S corporation in which you were a more-than-2% shareholder. Form 1040x fillable Health insurance premiums paid or reimbursed by the S corporation are shown as wages on Form W-2, Wage and Tax Statement. Form 1040x fillable The insurance plan must be established, or considered to be established as discussed in the following bullets, under your business. Form 1040x fillable For self-employed individuals filing a Schedule C, C-EZ, or F, a policy can be either in the name of the business or in the name of the individual. Form 1040x fillable For partners, a policy can be either in the name of the partnership or in the name of the partner. Form 1040x fillable You can either pay the premiums yourself or your partnership can pay them and report the premium amounts on Schedule K-1 (Form 1065) as guaranteed payments to be included in your gross income. Form 1040x fillable However, if the policy is in your name and you pay the premiums yourself, the partnership must reimburse you and report the premium amounts on Schedule K-1 (Form 1065) as guaranteed payments to be included in your gross income. Form 1040x fillable Otherwise, the insurance plan will not be considered to be established under your business. Form 1040x fillable For more-than-2% shareholders, a policy can be either in the name of the S corporation or in the name of the shareholder. Form 1040x fillable You can either pay the premiums yourself or your S corporation can pay them and report the premium amounts on Form W-2 as wages to be included in your gross income. Form 1040x fillable However, if the policy is in your name and you pay the premiums yourself, the S corporation must reimburse you and report the premium amounts on Form W-2 as wages to be included in your gross income. Form 1040x fillable Otherwise, the insurance plan will not be considered to be established under your business. Form 1040x fillable Medicare premiums you voluntarily pay to obtain insurance in your name that is similar to qualifying private health insurance can be used to figure the deduction. Form 1040x fillable If you previously filed returns without using Medicare premiums to figure the deduction, you can file timely amended returns to refigure the deduction. Form 1040x fillable For more information, see Form 1040X, Amended U. Form 1040x fillable S. Form 1040x fillable Individual Income Tax Return. Form 1040x fillable Amounts paid for health insurance coverage from retirement plan distributions that were nontaxable because you are a retired public safety officer cannot be used to figure the deduction. Form 1040x fillable Take the deduction on Form 1040, line 29. Form 1040x fillable Qualified long-term care insurance. Form 1040x fillable   You can include premiums paid on a qualified long-term care insurance contract when figuring your deduction. Form 1040x fillable But, for each person covered, you can include only the smaller of the following amounts. Form 1040x fillable The amount paid for that person. Form 1040x fillable The amount shown below. Form 1040x fillable Use the person's age at the end of the tax year. Form 1040x fillable Age 40 or younger–$360 Age 41 to 50–$680 Age 51 to 60–$1,360 Age 61 to 70–$3,640 Age 71 or older–$4,550 Qualified long-term care insurance contract. Form 1040x fillable   A qualified long-term care insurance contract is an insurance contract that only provides coverage of qualified long-term care services. Form 1040x fillable The contract must meet all the following requirements. Form 1040x fillable It must be guaranteed renewable. Form 1040x fillable It must provide that refunds, other than refunds on the death of the insured or complete surrender or cancellation of the contract, and dividends under the contract may be used only to reduce future premiums or increase future benefits. Form 1040x fillable It must not provide for a cash surrender value or other money that can be paid, assigned, pledged, or borrowed. Form 1040x fillable It generally must not pay or reimburse expenses incurred for services or items that would be reimbursed under Medicare, except where Medicare is a secondary payer or the contract makes per diem or other periodic payments without regard to expenses. Form 1040x fillable Qualified long-term care services. Form 1040x fillable   Qualified long-term care services are: Necessary diagnostic, preventive, therapeutic, curing, treating, mitigating, and rehabilitative services, and Maintenance or personal care services. Form 1040x fillable The services must be required by a chronically ill individual and prescribed by a licensed health care practitioner. Form 1040x fillable Worksheet 6-A. Form 1040x fillable Self-Employed Health Insurance Deduction Worksheet Note. Form 1040x fillable Use a separate worksheet for each trade or business under which an insurance plan is established. Form 1040x fillable 1. Form 1040x fillable Enter the total amount paid in 2013 for health insurance coverage established under your business for 2013 for you, your spouse, and your dependents. Form 1040x fillable Your insurance can also cover your child who was under age 27 at the end of 2013, even if the child was not your dependent. Form 1040x fillable But do not include the following. Form 1040x fillable   Amounts for any month you were eligible to participate in a health plan subsidized by your or your spouse's employer or the employer of either your dependent or your child who was under the age of 27 at the end of 2013. Form 1040x fillable Any amounts paid from retirement plan distributions that were nontaxable because you are a retired public safety officer. Form 1040x fillable Any amounts you included on Form 8885, line 4. Form 1040x fillable Any qualified health insurance premiums you paid to “U. Form 1040x fillable S. Form 1040x fillable Treasury-HCTC. Form 1040x fillable ” Any health coverage tax credit advance payments shown in box 1 of Form 1099-H. Form 1040x fillable Any payments for qualified long-term care insurance (see line 2) 1. Form 1040x fillable   2. Form 1040x fillable For coverage under a qualified long-term care insurance contract, enter for each person covered the smaller of the following amounts. Form 1040x fillable       a) Total payments made for that person during the year. Form 1040x fillable       b) The amount shown below. Form 1040x fillable Use the person's age at the end of the tax year. Form 1040x fillable         $360— if that person is age 40 or younger          $680— if age 41 to 50         $1,360— if age 51 to 60         $3,640— if age 61 to 70         $4,550— if age 71 or older         Do not include payments for any month you were eligible to participate in a long-term care insurance plan subsidized by your or your spouse’s employer or the employer of either your dependent or your child who was under the age of 27 at the end of 2013. Form 1040x fillable If more than one person is covered, figure separately the amount to enter for each person. Form 1040x fillable Then enter the total of those amounts 2. Form 1040x fillable   3. Form 1040x fillable Add lines 1 and 2 3. Form 1040x fillable   4. Form 1040x fillable Enter your net profit* and any other earned income** from the trade or business under which the insurance plan is established. Form 1040x fillable Do not include Conservation Reserve Program payments exempt from self-employment tax. Form 1040x fillable If the business is an S corporation, skip to line 11 4. Form 1040x fillable   5. Form 1040x fillable Enter the total of all net profits* from: Schedule C (Form 1040), line 31; Schedule C-EZ (Form 1040), line 3; Schedule F (Form 1040), line 34; or Schedule K-1 (Form 1065), box 14, code A; plus any other income allocable to the profitable businesses. Form 1040x fillable Do not include Conservation Reserve Program payments exempt from self-employment tax. Form 1040x fillable See the Instructions for Schedule SE (Form 1040). Form 1040x fillable Do not include any net losses shown on these schedules. Form 1040x fillable 5. Form 1040x fillable   6. Form 1040x fillable Divide line 4 by line 5 6. Form 1040x fillable   7. Form 1040x fillable Multiply Form 1040, line 27, by the percentage on line 6 7. Form 1040x fillable   8. Form 1040x fillable Subtract line 7 from line 4 8. Form 1040x fillable   9. Form 1040x fillable Enter the amount, if any, from Form 1040, line 28, attributable to the same trade or business in which the insurance plan is established 9. Form 1040x fillable   10. Form 1040x fillable Subtract line 9 from line 8 10. Form 1040x fillable   11. Form 1040x fillable Enter your Medicare wages (Form W-2, box 5) from an S corporation in which you are a more-than-2% shareholder and in which the insurance plan is established 11. Form 1040x fillable   12. Form 1040x fillable Enter any amount from Form 2555, line 45, attributable to the amount entered on line 4 or 11 above, or any amount from Form 2555-EZ, line 18, attributable to the amount entered on line 11 above 12. Form 1040x fillable   13. Form 1040x fillable Subtract line 12 from line 10 or 11, whichever applies 13. Form 1040x fillable   14. Form 1040x fillable Enter the smaller of line 3 or line 13 here and on Form 1040, line 29. Form 1040x fillable Do not include this amount when figuring any medical expense deduction on Schedule A (Form 1040). Form 1040x fillable 14. Form 1040x fillable   * If you used either optional method to figure your net earnings from self-employment from any business, do not enter your net profit from the business. Form 1040x fillable Instead, enter the amount attributable to that business from Schedule SE (Form 1040), Section B, line 4b. Form 1040x fillable * *Earned income includes net earnings and gains from the sale, transfer, or licensing of property you created. Form 1040x fillable However, it does not include capital gain income. Form 1040x fillable Chronically ill individual. Form 1040x fillable   A chronically ill individual is a person who has been certified as one of the following. Form 1040x fillable An individual who has been unable, due to loss of functional capacity for at least 90 days, to perform at least two activities of daily living without substantial assistance from another individual. Form 1040x fillable Activities of daily living are eating, toileting, transferring (general mobility), bathing, dressing, and continence. Form 1040x fillable An individual who requires substantial supervision to be protected from threats to health and safety due to severe cognitive impairment. Form 1040x fillable The certification must have been made by a licensed health care practitioner within the previous 12 months. Form 1040x fillable Benefits received. Form 1040x fillable   For information on excluding benefits you receive from a long-term care contract from gross income, see Publication 525. Form 1040x fillable Other coverage. Form 1040x fillable   You cannot take the deduction for any month you were eligible to participate in any employer (including your spouse's) subsidized health plan at any time during that month, even if you did not actually participate. Form 1040x fillable In addition, if you were eligible for any month or part of a month to participate in any subsidized health plan maintained by the employer of either your dependent or your child who was under age 27 at the end of 2013, do not use amounts paid for coverage for that month to figure the deduction. Form 1040x fillable   These rules are applied separately to plans that provide long-term care insurance and plans that do not provide long-term care insurance. Form 1040x fillable However, any medical insurance payments not deductible on Form 1040, line 29, can be included as medical expenses on Schedule A (Form 1040), Itemized Deductions, if you itemize deductions. Form 1040x fillable Effect on itemized deductions. Form 1040x fillable   Subtract the health insurance deduction from your medical insurance when figuring medical expenses on Schedule A (Form 1040) if you itemize deductions. Form 1040x fillable Effect on self-employment tax. Form 1040x fillable   For tax years beginning before or after 2010, you cannot subtract the self-employed health insurance deduction when figuring net earnings for your self-employment tax from the business under which the insurance plan is established, or considered to be established as discussed earlier. Form 1040x fillable For more information, see Schedule SE (Form 1040). Form 1040x fillable How to figure the deduction. Form 1040x fillable   Generally, you can use the worksheet in the Form 1040 instructions to figure your deduction. Form 1040x fillable However, if any of the following apply, you must use Worksheet 6-A in this chapter. Form 1040x fillable You had more than one source of income subject to self-employment tax. Form 1040x fillable You file Form 2555, Foreign Earned Income, or Form 2555-EZ, Foreign Earned Income Exclusion. Form 1040x fillable You are using amounts paid for qualified long-term care insurance to figure the deduction. Form 1040x fillable If you are claiming the health coverage tax credit, complete Form 8885, Health Coverage Tax Credit, before you figure this deduction. Form 1040x fillable Health coverage tax credit. Form 1040x fillable   You may be able to take this credit only if you were an eligible trade adjustment assistance (TAA) recipient, alternative TAA (ATAA) recipient, reemployment trade adjustment assistance (RTAA) recipient, or Pension Benefit Guaranty Corporation (PBGC) pension recipient. Form 1040x fillable Use Form 8885 to figure the amount, if any, of this credit. Form 1040x fillable   When figuring the amount to enter on line 1 of Worksheet 6-A, do not include the following. Form 1040x fillable Any amounts you included on Form 8885, line 4. Form 1040x fillable Any qualified health insurance premiums you paid to “U. Form 1040x fillable S. Form 1040x fillable Treasury-HCTC. Form 1040x fillable ” Any health coverage tax credit advance payments shown in box 1 of Form 1099-H, Health Coverage Tax Credit (HCTC) Advance Payments. Form 1040x fillable More than one health plan and business. Form 1040x fillable   If you have more than one health plan during the year and each plan is established under a different business, you must use separate worksheets (Worksheet 6-A) to figure each plan's net earnings limit. Form 1040x fillable Include the premium you paid under each plan on line 1 or line 2 of that separate worksheet and your net profit (or wages) from that business on line 4 (or line 11). Form 1040x fillable For a plan that provides long-term care insurance, the total of the amounts entered for each person on line 2 of all worksheets cannot be more than the appropriate limit shown on line 2 for that person. Form 1040x fillable Nondeductible Premiums You cannot deduct premiums on the following kinds of insurance. Form 1040x fillable Self-insurance reserve funds. Form 1040x fillable You cannot deduct amounts credited to a reserve set up for self-insurance. Form 1040x fillable This applies even if you cannot get business insurance coverage for certain business risks. Form 1040x fillable However, your actual losses may be deductible. Form 1040x fillable See Publication 547. Form 1040x fillable Loss of earnings. Form 1040x fillable You cannot deduct premiums for a policy that pays for lost earnings due to sickness or disability. Form 1040x fillable However, see the discussion on overhead insurance, item (8), under Deductible Premiums , earlier. Form 1040x fillable Certain life insurance and annuities. Form 1040x fillable For contracts issued before June 9, 1997, you cannot deduct the premiums on a life insurance policy covering you, an employee, or any person with a financial interest in your business if you are directly or indirectly a beneficiary of the policy. Form 1040x fillable You are included among possible beneficiaries of the policy if the policy owner is obligated to repay a loan from you using the proceeds of the policy. Form 1040x fillable A person has a financial interest in your business if the person is an owner or part owner of the business or has lent money to the business. Form 1040x fillable For contracts issued after June 8, 1997, you generally cannot deduct the premiums on any life insurance policy, endowment contract, or annuity contract if you are directly or indirectly a beneficiary. Form 1040x fillable The disallowance applies without regard to whom the policy covers. Form 1040x fillable Partners. Form 1040x fillable If, as a partner in a partnership, you take out an insurance policy on your own life and name your partners as beneficiaries to induce them to retain their investments in the partnership, you are considered a beneficiary. Form 1040x fillable You cannot deduct the insurance premiums. Form 1040x fillable Insurance to secure a loan. Form 1040x fillable If you take out a policy on your life or on the life of another person with a financial interest in your business to get or protect a business loan, you cannot deduct the premiums as a business expense. Form 1040x fillable Nor can you deduct the premiums as interest on business loans or as an expense of financing loans. Form 1040x fillable In the event of death, the proceeds of the policy are generally not taxed as income even if they are used to liquidate the debt. Form 1040x fillable Capitalized Premiums Under the uniform capitalization rules, you must capitalize the direct costs and part of the indirect costs for certain production or resale activities. Form 1040x fillable Include these costs in the basis of property you produce or acquire for resale, rather than claiming them as a current deduction. Form 1040x fillable You recover the costs through depreciation, amortization, or cost of goods sold when you use, sell, or otherwise dispose of the property. Form 1040x fillable Indirect costs include premiums for insurance on your plant or facility, machinery, equipment, materials, property produced, or property acquired for resale. Form 1040x fillable Uniform capitalization rules. Form 1040x fillable   You may be subject to the uniform capitalization rules if you do any of the following, unless the property is produced for your use other than in a business or an activity carried on for profit. Form 1040x fillable Produce real property or tangible personal property. Form 1040x fillable For this purpose, tangible personal property includes a film, sound recording, video tape, book, or similar property. Form 1040x fillable Acquire property for resale. Form 1040x fillable However, these rules do not apply to the following property. Form 1040x fillable Personal property you acquire for resale if your average annual gross receipts are $10 million or less for the 3 prior tax years. Form 1040x fillable Property you produce if you meet either of the following conditions. Form 1040x fillable Your indirect costs of producing the property are $200,000 or less. Form 1040x fillable You use the cash method of accounting and do not account for inventories. Form 1040x fillable More information. Form 1040x fillable   For more information on these rules, see Uniform Capitalization Rules in Publication 538 and the regulations under Internal Revenue Code section 263A. Form 1040x fillable When To Deduct Premiums You can usually deduct insurance premiums in the tax year to which they apply. Form 1040x fillable Cash method. Form 1040x fillable   If you use the cash method of accounting, you generally deduct insurance premiums in the tax year you actually paid them, even if you incurred them in an earlier year. Form 1040x fillable However, see Prepayment , later. Form 1040x fillable Accrual method. Form 1040x fillable   If you use an accrual method of accounting, you cannot deduct insurance premiums before the tax year in which you incur a liability for them. Form 1040x fillable In addition, you cannot deduct insurance premiums before the tax year in which you actually pay them (unless the exception for recurring items applies). Form 1040x fillable For more information about the accrual method of accounting, see chapter 1. Form 1040x fillable For information about the exception for recurring items, see Publication 538. Form 1040x fillable Prepayment. Form 1040x fillable   You cannot deduct expenses in advance, even if you pay them in advance. Form 1040x fillable This rule applies to any expense paid far enough in advance to, in effect, create an asset with a useful life extending substantially beyond the end of the current tax year. Form 1040x fillable   Expenses such as insurance are generally allocable to a period of time. Form 1040x fillable You can deduct insurance expenses for the year to which they are allocable. Form 1040x fillable Example. Form 1040x fillable In 2013, you signed a 3-year insurance contract. Form 1040x fillable Even though you paid the premiums for 2013, 2014, and 2015 when you signed the contract, you can only deduct the premium for 2013 on your 2013 tax return. Form 1040x fillable You can deduct in 2014 and 2015 the premium allocable to those years. Form 1040x fillable Dividends received. Form 1040x fillable   If you receive dividends from business insurance and you deducted the premiums in prior years, at least part of the dividends generally are income. Form 1040x fillable For more information, see Recovery of amount deducted (tax benefit rule) in chapter 1 under How Much Can I Deduct. Form 1040x fillable Prev  Up  Next   Home   More Online Publications