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Free E File 1040ez

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Free E File 1040ez

Free e file 1040ez 5. Free e file 1040ez   Figuring Your Tax Table of Contents Introduction Topics - This chapter discusses: Useful Items - You may want to see: Tax Year Identification NumberF-1 and M-1 visa holders. Free e file 1040ez J-1 visa holders. Free e file 1040ez Filing StatusResident Aliens Nonresident Aliens Reporting Your Income DeductionsResident Aliens Nonresident Aliens ExemptionsResident Aliens Nonresident Aliens Itemized DeductionsResident Aliens Nonresident Aliens Tax Credits and PaymentsResident Aliens Nonresident Aliens Bona Fide Residents of American Samoa or Puerto Rico Introduction After you have determined your alien status, the source of your income, and if and how that income is taxed in the United States, your next step is to figure your tax. Free e file 1040ez The information in this chapter is not as comprehensive for resident aliens as it is for nonresident aliens. Free e file 1040ez Resident aliens should get publications, forms, and instructions for U. Free e file 1040ez S. Free e file 1040ez citizens, because the information for filing returns for resident aliens is generally the same as for U. Free e file 1040ez S. Free e file 1040ez citizens. Free e file 1040ez If you are both a nonresident alien and a resident alien in the same tax year, see chapter 6 for a discussion of dual-status aliens. Free e file 1040ez Topics - This chapter discusses: Identification numbers, Filing status, Deductions, Exemptions, Tax credits and payments, and Special rules for bona fide residents of American Samoa and Puerto Rico. Free e file 1040ez Useful Items - You may want to see: Publication 463 Travel, Entertainment, Gift, and Car Expenses 501 Exemptions, Standard Deduction, and Filing Information 521 Moving Expenses 526 Charitable Contributions 535 Business Expenses 597 Information on the United States–Canada Income Tax Treaty Form (and Instructions) W-7 Application for IRS Individual Taxpayer Identification Number 1040 U. Free e file 1040ez S. Free e file 1040ez Individual Income Tax Return 1040NR U. Free e file 1040ez S. Free e file 1040ez Nonresident Alien Income Tax Return 1040NR-EZ U. Free e file 1040ez S. Free e file 1040ez Income Tax Return for Certain Nonresident Aliens With No Dependents 2106 Employee Business Expenses 2106-EZ Unreimbursed Employee Business Expenses 3903 Moving Expenses 4563 Exclusion of Income for Bona Fide Residents of American Samoa 8959 Additional Medicare Tax See chapter 12 for information about getting these publications and forms. Free e file 1040ez Tax Year You must figure your income and file a tax return on the basis of an annual accounting period called a tax year. Free e file 1040ez If you have not previously established a fiscal tax year, your tax year is the calendar year. Free e file 1040ez A calendar year is 12 consecutive months ending on December 31. Free e file 1040ez If you have previously established a regular fiscal year (12 consecutive months ending on the last day of a month other than December or a 52–53 week year) and are considered to be a U. Free e file 1040ez S. Free e file 1040ez resident for any calendar year, you will be treated as a U. Free e file 1040ez S. Free e file 1040ez resident for any part of your fiscal year that falls within that calendar year. Free e file 1040ez Identification Number A taxpayer identification number must be furnished on returns, statements, and other tax-related documents. Free e file 1040ez For an individual, this is a social security number (SSN). Free e file 1040ez If you do not have and are not eligible to get an SSN, you must apply for an individual taxpayer identification number (ITIN). Free e file 1040ez An employer identification number (EIN) is required if you are engaged in a trade or business as a sole proprietor and have employees or a qualified retirement plan. Free e file 1040ez You must furnish a taxpayer identification number if you are: An alien who has income effectively connected with the conduct of a U. Free e file 1040ez S. Free e file 1040ez trade or business at any time during the year, An alien who has a U. Free e file 1040ez S. Free e file 1040ez office or place of business at any time during the year, A nonresident alien spouse treated as a resident, as discussed in chapter 1, or Any other alien who files a tax return, an amended return, or a refund claim (but not information returns). Free e file 1040ez Social security number (SSN). Free e file 1040ez   Generally, you can get an SSN if you have been lawfully admitted to the United States for permanent residence or under other immigration categories that authorize U. Free e file 1040ez S. Free e file 1040ez employment. Free e file 1040ez   To apply for this number, get Form SS-5, Application for a Social Security Card, from your local Social Security Administration (SSA) office or call the SSA at 1-800-772-1213. Free e file 1040ez You can also download Form SS-5 from the SSA's website at www. Free e file 1040ez socialsecurity. Free e file 1040ez gov/ssnumber/ss5. Free e file 1040ez htm. Free e file 1040ez You must visit an SSA office in person and submit your Form SS-5 along with original documentation showing your age, identity, immigration status, and authority to work in the United States. Free e file 1040ez Generally, you will receive your card about 2 weeks after the SSA has all of the necessary information. Free e file 1040ez F-1 and M-1 visa holders. Free e file 1040ez    If you are an F-1 or M-1 student, you must also show your Form I-20. Free e file 1040ez For more information, see SSA Publication 05-10181, International Students and Social Security Numbers, available online at www. Free e file 1040ez socialsecurity. Free e file 1040ez gov/pubs/10181. Free e file 1040ez html. Free e file 1040ez J-1 visa holders. Free e file 1040ez   If you are a J-1 exchange visitor, you will also need to show your Form DS-2019. Free e file 1040ez For more information, see SSA Publication 05-10107, Foreign Workers and Social Security Numbers, available online at www. Free e file 1040ez socialsecurity. Free e file 1040ez gov/pubs/10107. Free e file 1040ez html. Free e file 1040ez Individual taxpayer identification number (ITIN). Free e file 1040ez   If you do not have and are not eligible to get an SSN, you must apply for an ITIN. Free e file 1040ez For details on how to do so, see Form W-7 and its instructions. Free e file 1040ez Allow 6 to 10 weeks for the IRS to notify you of your ITIN. Free e file 1040ez If you already have an ITIN, enter it wherever an SSN is required on your tax return. Free e file 1040ez   An ITIN is for tax use only. Free e file 1040ez It does not entitle you to social security benefits or change your employment or immigration status under U. Free e file 1040ez S. Free e file 1040ez law. Free e file 1040ez   In addition to those aliens who are required to furnish a taxpayer identification number and are not eligible for an SSN, a Form W-7 must be filed for: Alien individuals who are claimed as dependents and are not eligible for an SSN, and Alien spouses who are claimed as exemptions and are not eligible for an SSN. Free e file 1040ez Employer identification number (EIN). Free e file 1040ez   An individual may use an SSN (or ITIN) for individual taxes and an EIN for business taxes. Free e file 1040ez To apply for an EIN, file Form SS-4, Application for Employer Identification Number, with the IRS. Free e file 1040ez Filing Status The amount of your tax depends on your filing status. Free e file 1040ez Your filing status is important in determining whether you can take certain deductions and credits. Free e file 1040ez The rules for determining your filing status are different for resident aliens and nonresident aliens. Free e file 1040ez Resident Aliens Resident aliens can use the same filing statuses available to U. Free e file 1040ez S. Free e file 1040ez citizens. Free e file 1040ez See your form instructions or Publication 501 for more information on filing status. Free e file 1040ez Married filing jointly. Free e file 1040ez   Generally, you can file as married filing jointly only if both you and your spouse were resident aliens for the entire tax year, or if you make one of the choices discussed in chapter 1 to treat your spouse as a resident alien for the entire tax year. Free e file 1040ez Qualifying widow(er). Free e file 1040ez   If your spouse died in 2011 or 2012, you did not remarry before the end of 2013, and you have a dependent child living with you, you may qualify to file as a qualifying widow(er) and use the joint return tax rates. Free e file 1040ez This applies only if you could have filed a joint return with your spouse for the year your spouse died. Free e file 1040ez Head of household. Free e file 1040ez   You can qualify as head of household if you are unmarried or considered unmarried on the last day of the year and you pay more than half the cost of keeping up a home for you and a qualifying person. Free e file 1040ez You must be a resident alien for the entire tax year. Free e file 1040ez   You are considered unmarried for this purpose if your spouse was a nonresident alien at any time during the year and you do not make one of the choices discussed in chapter 1 to treat your spouse as a resident alien for the entire tax year. Free e file 1040ez Note. Free e file 1040ez   Even if you are considered unmarried for head of household purposes because you are married to a nonresident alien, you may still be considered married for purposes of the earned income credit. Free e file 1040ez In that case, you will not be entitled to the credit. Free e file 1040ez See Publication 596 for more information. Free e file 1040ez Nonresident Aliens If you are a nonresident alien filing Form 1040NR, you may be able to use one of the filing statuses discussed later. Free e file 1040ez If you are filing Form 1040NR-EZ, you can only claim “Single nonresident alien” or “Married nonresident alien” as your filing status. Free e file 1040ez Married nonresident alien. Free e file 1040ez   Married nonresident aliens who are not married to U. Free e file 1040ez S. Free e file 1040ez citizens or residents generally must use the Tax Table column or the Tax Computation Worksheet for married filing separate returns when determining the tax on income effectively connected with a U. Free e file 1040ez S. Free e file 1040ez trade or business. Free e file 1040ez Exceptions. Free e file 1040ez   Married nonresident aliens normally cannot use the Tax Table column or the Tax Computation Worksheet for single individuals. Free e file 1040ez However, you may be able to file as single if you lived apart from your spouse during the last 6 months of the year and you are a married resident of Canada, Mexico, South Korea, or are a married U. Free e file 1040ez S. Free e file 1040ez national. Free e file 1040ez See the instructions for Form 1040NR or Form 1040NR-EZ to see if you qualify. Free e file 1040ez U. Free e file 1040ez S. Free e file 1040ez national is defined later in this section under Qualifying widow(er) . Free e file 1040ez   A nonresident alien generally cannot file as married filing jointly. Free e file 1040ez However, a nonresident alien who is married to a U. Free e file 1040ez S. Free e file 1040ez citizen or resident can choose to be treated as a resident and file a joint return on Form 1040, Form 1040A, or Form 1040EZ. Free e file 1040ez For information on these choices, see chapter 1. Free e file 1040ez If you do not make the choice to file jointly, file Form 1040NR or Form 1040NR-EZ and use the Tax Table column or the Tax Computation Worksheet for married individuals filing separately. Free e file 1040ez Qualifying widow(er). Free e file 1040ez   You may be eligible to file as a qualifying widow(er) and use the joint return tax rates if all of the following conditions apply. Free e file 1040ez You were a resident of Canada, Mexico, or South Korea, or a U. Free e file 1040ez S. Free e file 1040ez national (defined later). Free e file 1040ez Your spouse died in 2011 or 2012 and you did not remarry before the end of 2013. Free e file 1040ez You have a dependent child living with you. Free e file 1040ez See the instructions for Form 1040NR for the rules for filing as a qualifying widow(er) with a dependent child. Free e file 1040ez   A U. Free e file 1040ez S. Free e file 1040ez national is an individual who, although not a U. Free e file 1040ez S. Free e file 1040ez citizen, owes his or her allegiance to the United States. Free e file 1040ez U. Free e file 1040ez S. Free e file 1040ez nationals include American Samoans and Northern Mariana Islanders who chose to become U. Free e file 1040ez S. Free e file 1040ez nationals instead of U. Free e file 1040ez S. Free e file 1040ez citizens. Free e file 1040ez Head of household. Free e file 1040ez   You cannot file as head of household if you are a nonresident alien at any time during the tax year. Free e file 1040ez However, if you are married, your spouse can qualify as a head of household if: Your spouse is a resident alien or U. Free e file 1040ez S. Free e file 1040ez citizen for the entire tax year, You do not choose to be treated as a resident alien, and Your spouse meets the other requirements for this filing status, as discussed earlier under Resident Aliens . Free e file 1040ez Note. Free e file 1040ez   Even if your spouse is considered unmarried for head of household purposes because you are a nonresident alien, your spouse may still be considered married for purposes of the earned income credit. Free e file 1040ez In that case, your spouse will not be entitled to the credit. Free e file 1040ez See Publication 596 for more information. Free e file 1040ez Estates and trusts. Free e file 1040ez   A nonresident alien estate or trust using Form 1040NR must use Tax Rate Schedule W in the Form 1040NR instructions when determining the tax on income effectively connected with a U. Free e file 1040ez S. Free e file 1040ez trade or business. Free e file 1040ez Special rules for aliens from certain U. Free e file 1040ez S. Free e file 1040ez possessions. Free e file 1040ez   A nonresident alien who is a bona fide resident of American Samoa or Puerto Rico for the entire tax year and who is temporarily working in the United States should read Bona Fide Residents of American Samoa or Puerto Rico, at the end of this chapter, for information about special rules. Free e file 1040ez Reporting Your Income You must report each item of income that is taxable according to the rules in chapters 2, 3, and 4. Free e file 1040ez For resident aliens, this includes income from sources both within and outside the United States. Free e file 1040ez For nonresident aliens, this includes both income that is effectively connected with a trade or business in the United States (subject to graduated tax rates) and income from U. Free e file 1040ez S. Free e file 1040ez sources that is not effectively connected (subject to a flat 30% tax rate or lower tax treaty rate). Free e file 1040ez Deductions Resident and nonresident aliens can claim similar deductions on their U. Free e file 1040ez S. Free e file 1040ez tax returns. Free e file 1040ez However, nonresident aliens generally can claim only deductions related to income that is effectively connected with their U. Free e file 1040ez S. Free e file 1040ez trade or business. Free e file 1040ez Resident Aliens You can claim the same deductions allowed to U. Free e file 1040ez S. Free e file 1040ez citizens if you are a resident alien for the entire tax year. Free e file 1040ez While the discussion that follows contains some of the same general rules and guidelines that apply to you, it is specifically directed toward nonresident aliens. Free e file 1040ez You should get Form 1040 and instructions for more information on how to claim your allowable deductions. Free e file 1040ez Nonresident Aliens You can claim deductions to figure your effectively connected taxable income. Free e file 1040ez You generally cannot claim deductions related to income that is not connected with your U. Free e file 1040ez S. Free e file 1040ez business activities. Free e file 1040ez Except for personal exemptions, and certain itemized deductions, discussed later, you can claim deductions only to the extent they are connected with your effectively connected income. Free e file 1040ez Ordinary and necessary business expenses. Free e file 1040ez   You can deduct all ordinary and necessary expenses in the operation of your U. Free e file 1040ez S. Free e file 1040ez trade or business to the extent they relate to income effectively connected with that trade or business. Free e file 1040ez The deduction for travel expenses while in the United States is discussed under Itemized Deductions, later. Free e file 1040ez For information about other business expenses, see Publication 535. Free e file 1040ez Losses. Free e file 1040ez   You can deduct losses resulting from transactions that you entered into for profit and that you were not reimbursed for by insurance, etc. Free e file 1040ez to the extent that they relate to income that is effectively connected with a trade or business in the United States. Free e file 1040ez Educator expenses. Free e file 1040ez   If you were an eligible educator in 2013, you can deduct as an adjustment to income up to $250 in unreimbursed qualified expenses you paid or incurred during 2013 for books, supplies (other than nonathletic supplies for courses of instruction in health or physical education), computer equipment, and other equipment and materials used in the classroom. Free e file 1040ez For more information, see your tax form instructions. Free e file 1040ez Individual retirement arrangement (IRA). Free e file 1040ez   If you made contributions to a traditional IRA for 2013, you may be able to take an IRA deduction. Free e file 1040ez But you must have taxable compensation effectively connected with a U. Free e file 1040ez S. Free e file 1040ez trade or business to do so. Free e file 1040ez A Form 5498 should be sent to you by May 31, 2014, that shows all contributions to your traditional IRA for 2013. Free e file 1040ez If you were covered by a retirement plan (qualified pension, profit-sharing (including 401(k)), annuity, SEP, SIMPLE, etc. Free e file 1040ez ) at work or through self-employment, your IRA deduction may be reduced or eliminated. Free e file 1040ez But you can still make contributions to a traditional IRA even if you cannot deduct them. Free e file 1040ez If you made nondeductible contributions to a traditional IRA for 2013, you must report them on Form 8606, Nondeductible IRAs. Free e file 1040ez   For more information, see Publication 590, Individual Retirement Arrangements (IRAs). Free e file 1040ez Moving expenses. Free e file 1040ez   If you are a nonresident alien temporarily in the United States earning taxable income for performing personal services, you can deduct moving expenses to the United States if you meet both of the following tests. Free e file 1040ez You are a full-time employee for at least 39 weeks during the 12 months right after you move, or if you are self-employed, you work full time for at least 39 weeks during the first 12 months and 78 weeks during the first 24 months right after you move. Free e file 1040ez Your new job location is at least 50 miles farther (by the shortest commonly traveled route) from your former home than your former job location was. Free e file 1040ez If you had no former job location, the new job location must be at least 50 miles from your former home. Free e file 1040ez   You cannot deduct the moving expense you have when returning to your home abroad or moving to a foreign job site. Free e file 1040ez   Figure your deductible moving expenses to the United States on Form 3903, and deduct them on line 26 of Form 1040NR. Free e file 1040ez   For more information on the moving expense deduction, see Publication 521. Free e file 1040ez Reimbursements. Free e file 1040ez   If your employer reimbursed you for allowable moving expenses under an accountable plan, your employer should have excluded these reimbursements from your income. Free e file 1040ez You can only deduct allowable moving expenses that were not reimbursed by your employer or that were reimbursed but the reimbursement was included in your income. Free e file 1040ez For more information, see Publication 521. Free e file 1040ez Moving expense or travel expense. Free e file 1040ez   If you deduct moving expenses to the United States, you cannot also deduct travel expenses (discussed later under Itemized Deductions) while temporarily away from your tax home in a foreign country. Free e file 1040ez Moving expenses are based on a change in your principal place of business while travel expenses are based on your temporary absence from your principal place of business. Free e file 1040ez Self-employed SEP, SIMPLE, and qualified retirement plans. Free e file 1040ez   If you are self-employed, you may be able to deduct contributions to a SEP, SIMPLE, or qualified retirement plan that provides retirement benefits for yourself and your common-law employees, if any. Free e file 1040ez To make deductible contributions for yourself, you must have net earnings from self-employment that are effectively connected with your U. Free e file 1040ez S. Free e file 1040ez trade or business. Free e file 1040ez   Get Publication 560, Retirement Plans for Small Business (SEP, SIMPLE, and Qualified Plans), for further information. Free e file 1040ez Penalty on early withdrawal of savings. Free e file 1040ez   You must include in income all effectively connected interest income you receive or that is credited to your account during the year. Free e file 1040ez Do not reduce it by any penalty you must pay on an early withdrawal from a time savings account. Free e file 1040ez However, if the interest income is effectively connected with your U. Free e file 1040ez S. Free e file 1040ez trade or business during the year, you can deduct on line 30 of Form 1040NR the amount of the early withdrawal penalty that the banking institution charged. Free e file 1040ez Student loan interest expense. Free e file 1040ez   If you paid interest on a student loan in 2013, you may be able to deduct up to $2,500 of the interest you paid. Free e file 1040ez Generally, you can claim the deduction if all the following requirements are met. Free e file 1040ez Your filing status is any filing status except married filing separately. Free e file 1040ez Your modified adjusted gross income is less than $75,000. Free e file 1040ez No one else is claiming an exemption for you on his or her 2013 tax return. Free e file 1040ez You paid interest on a loan taken out only to pay tuition and other qualified higher education expenses for yourself, your spouse, someone who was your dependent when the loan was taken out, or someone you could have claimed as a dependent for the year the loan was taken out except that: The person filed a joint return, The person had gross income that was equal to or more than the exemption amount for that year ($3,900 for 2013), or You could be claimed as a dependent on someone else's return. Free e file 1040ez The loan is not from a related person or a person who borrowed the proceeds under a qualified employer plan or a contract purchased under such a plan. Free e file 1040ez The education expenses were paid or incurred within a reasonable period of time before or after the loan was taken out. Free e file 1040ez The person for whom the expenses were paid or incurred was an eligible student. Free e file 1040ez Use the worksheet in the Form 1040NR or Form 1040NR-EZ instructions to figure the deduction. Free e file 1040ez For more information, see Publication 970, Tax Benefits for Education. Free e file 1040ez Exemptions Resident aliens can claim personal exemptions and exemptions for dependents in the same way as U. Free e file 1040ez S. Free e file 1040ez citizens. Free e file 1040ez However, nonresident aliens generally can claim only a personal exemption for themselves on their U. Free e file 1040ez S. Free e file 1040ez tax return. Free e file 1040ez Resident Aliens You can claim personal exemptions and exemptions for dependents according to the dependency rules for U. Free e file 1040ez S. Free e file 1040ez citizens. Free e file 1040ez You can claim an exemption for your spouse on a separate return if your spouse had no gross income for U. Free e file 1040ez S. Free e file 1040ez tax purposes and was not the dependent of another taxpayer. Free e file 1040ez You can claim this exemption even if your spouse has not been a resident alien for a full tax year or is an alien who has not come to the United States. Free e file 1040ez You can claim an exemption for each person who qualifies as a dependent according to the rules for U. Free e file 1040ez S. Free e file 1040ez citizens. Free e file 1040ez The dependent must be a citizen or national (defined earlier) of the United States or be a resident of the United States, Canada, or Mexico for some part of the calendar year in which your tax year begins. Free e file 1040ez Get Publication 501 for more information. Free e file 1040ez Your spouse and each dependent for whom you claim an exemption must have either an SSN or an ITIN. Free e file 1040ez See Identification Number, earlier. Free e file 1040ez Nonresident Aliens Generally, if you are a nonresident alien engaged in a trade or business in the United States, you can claim only one personal exemption ($3,900 for 2013). Free e file 1040ez You may be able to claim an exemption for a spouse and a dependent if you are described in any of the following discussions. Free e file 1040ez Your spouse and each dependent for whom you claim an exemption must have either an SSN or an ITIN. Free e file 1040ez See Identification Number, earlier. Free e file 1040ez Residents of Mexico or Canada or U. Free e file 1040ez S. Free e file 1040ez nationals. Free e file 1040ez   If you are a resident of Mexico or Canada or a national of the United States (defined earlier), you can also claim a personal exemption for your spouse if your spouse had no gross income for U. Free e file 1040ez S. Free e file 1040ez tax purposes and cannot be claimed as the dependent on another U. Free e file 1040ez S. Free e file 1040ez taxpayer's return. Free e file 1040ez In addition, you can claim exemptions for your dependents who meet certain tests. Free e file 1040ez Residents of Mexico, Canada, or nationals of the United States must use the same rules as U. Free e file 1040ez S. Free e file 1040ez citizens to determine who is a dependent and for which dependents exemptions can be claimed. Free e file 1040ez See Publication 501 for these rules. Free e file 1040ez For purposes of these rules, dependents who are U. Free e file 1040ez S. Free e file 1040ez nationals meet the citizenship test discussed in Publication 501. Free e file 1040ez Residents of South Korea. Free e file 1040ez   Nonresident aliens who are residents of South Korea may be able to claim exemptions for a spouse and children. Free e file 1040ez The income tax treaty with South Korea imposes two additional requirements on South Korean residents: The spouse and all children claimed must live with the alien in the United States at some time during the tax year, and The additional deduction for the exemptions must be prorated based on the ratio of the alien's U. Free e file 1040ez S. Free e file 1040ez source gross income effectively connected with a U. Free e file 1040ez S. Free e file 1040ez trade or business for the tax year to the alien's entire income from all sources during the tax year. Free e file 1040ez Example. Free e file 1040ez Mr. Free e file 1040ez Park, a nonresident alien who is a resident of South Korea, lives temporarily in the United States with his wife and two children. Free e file 1040ez During the tax year he receives U. Free e file 1040ez S. Free e file 1040ez compensation of $18,000. Free e file 1040ez He also receives $6,000 of income from sources outside the United States that is not effectively connected with his U. Free e file 1040ez S. Free e file 1040ez trade or business. Free e file 1040ez Thus, his total income for the year is $24,000. Free e file 1040ez Mr. Free e file 1040ez Park meets all requirements for claiming exemptions for his spouse and two children. Free e file 1040ez The additional deduction for 2013 is $8,775 figured as follows: $18,000 $24,000 × $11,700* = $8,775               *3 × $3,900 = $11,700   Students and business apprentices from India. Free e file 1040ez   Students and business apprentices who are eligible for the benefits of Article 21(2) of the United States–India Income Tax Treaty may be able to claim exemptions for their spouse and dependents. Free e file 1040ez   You can claim an exemption for your spouse if he or she had no gross income during the year and cannot be claimed as a dependent on another U. Free e file 1040ez S. Free e file 1040ez taxpayer's return. Free e file 1040ez   You can claim exemptions for each of your dependents not admitted to the United States on “F-2,” “J-2,” or “M-2” visas if they meet the same rules that apply to U. Free e file 1040ez S. Free e file 1040ez citizens. Free e file 1040ez See Publication 501 for these rules. Free e file 1040ez   List your spouse and dependents on line 7c of Form 1040NR. Free e file 1040ez Enter the total on the appropriate line to the right of line 7c. Free e file 1040ez Itemized Deductions Nonresident aliens can claim some of the same itemized deductions that resident aliens can claim. Free e file 1040ez However, nonresident aliens can claim itemized deductions only if they have income effectively connected with their U. Free e file 1040ez S. Free e file 1040ez trade or business. Free e file 1040ez Resident Aliens You can claim the same itemized deductions as U. Free e file 1040ez S. Free e file 1040ez citizens, using Schedule A of Form 1040. Free e file 1040ez These deductions include certain medical and dental expenses, state and local income taxes, real estate taxes, interest you paid on a home mortgage, charitable contributions, casualty and theft losses, and miscellaneous deductions. Free e file 1040ez If you do not itemize your deductions, you can claim the standard deduction for your particular filing status. Free e file 1040ez For further information, see Form 1040 and instructions. Free e file 1040ez Nonresident Aliens You can deduct certain itemized deductions if you receive income effectively connected with your U. Free e file 1040ez S. Free e file 1040ez trade or business. Free e file 1040ez These deductions include state and local income taxes, charitable contributions to U. Free e file 1040ez S. Free e file 1040ez organizations, casualty and theft losses, and miscellaneous deductions. Free e file 1040ez Use Schedule A of Form 1040NR to claim itemized deductions. Free e file 1040ez If you are filing Form 1040NR-EZ, you can only claim a deduction for state or local income taxes. Free e file 1040ez If you are claiming any other itemized deduction, you must file Form 1040NR. Free e file 1040ez Standard deduction. Free e file 1040ez   Nonresident aliens cannot claim the standard deduction. Free e file 1040ez However, see Students and business apprentices from India , next. Free e file 1040ez Students and business apprentices from India. Free e file 1040ez   A special rule applies to students and business apprentices who are eligible for the benefits of Article 21(2) of the United States–India Income Tax Treaty. Free e file 1040ez You can claim the standard deduction provided you do not claim itemized deductions. Free e file 1040ez   Use Worksheet 5-1 to figure your standard deduction. Free e file 1040ez If you are married and your spouse files a return and itemizes deductions, you cannot take the standard deduction. Free e file 1040ez State and local income taxes. Free e file 1040ez   You can deduct state and local income taxes you paid on income that is effectively connected with a trade or business in the United States. Free e file 1040ez If you received a refund or rebate in 2013 of taxes you paid in an earlier year, do not reduce your deduction by that amount. Free e file 1040ez Instead, you must include the refund or rebate in income if you deducted the taxes in the earlier year and the deduction reduced your tax. Free e file 1040ez See Recoveries in Publication 525 for details on how to figure the amount to include in income. Free e file 1040ez Charitable contributions. Free e file 1040ez   You can deduct your charitable contributions or gifts to qualified organizations subject to certain limits. Free e file 1040ez Qualified organizations include organizations that are religious, charitable, educational, scientific, or literary in nature, or that work to prevent cruelty to children or animals. Free e file 1040ez Certain organizations that promote national or international amateur sports competition are also qualified organizations. Free e file 1040ez Foreign organizations. Free e file 1040ez   Contributions made directly to a foreign organization are not deductible. Free e file 1040ez However, you can deduct contributions to a U. Free e file 1040ez S. Free e file 1040ez organization that transfers funds to a charitable foreign organization if the U. Free e file 1040ez S. Free e file 1040ez organization controls the use of the funds or if the foreign organization is only an administrative arm of the U. Free e file 1040ez S. Free e file 1040ez organization. Free e file 1040ez   For more information about organizations that qualify to receive charitable contributions, see Publication 526, Charitable Contributions. Free e file 1040ez Worksheet 5-1. Free e file 1040ez 2013 Standard Deduction Worksheet for Students and Business Apprentices From India Caution. Free e file 1040ez If you are married filing a separate return and your spouse itemizes deductions, do not complete this worksheet. Free e file 1040ez You cannot take the standard deduction even if you were born before January 2, 1949, or are blind. Free e file 1040ez 1 Enter the amount shown below for your filing status. Free e file 1040ez           Single or married filing separately—$6,100 Qualifying widow(er)—$12,200 1. Free e file 1040ez           2 Can you be claimed as a dependent on someone else's U. Free e file 1040ez S. Free e file 1040ez income tax return?  No. Free e file 1040ez Enter the amount from line 1 on line 4. Free e file 1040ez Skip line 3 and go to line 5. Free e file 1040ez   Yes. Free e file 1040ez Go to line 3. Free e file 1040ez         3 Is your earned income* more than $650?           Yes. Free e file 1040ez Add $350 to your earned income. Free e file 1040ez Enter the total. Free e file 1040ez           No. Free e file 1040ez Enter $1,000 3. Free e file 1040ez       4 Enter the smaller of line 1 or line 3 4. Free e file 1040ez   5 If born before January 2, 1949, OR blind, enter $1,200 ($1,500 if single). Free e file 1040ez If born before January 2, 1949, AND blind, enter $2,400 ($3,000 if single). Free e file 1040ez Otherwise, enter -0- 5. Free e file 1040ez   6 Add lines 4 and 5. Free e file 1040ez Enter the total here and on Form 1040NR, line 38 (or Form 1040NR-EZ, line 11). Free e file 1040ez Print “Standard Deduction Allowed Under U. Free e file 1040ez S. Free e file 1040ez –India Income Tax Treaty” in the space to the left of these lines. Free e file 1040ez This is your standard deduction for 2013. Free e file 1040ez 6. Free e file 1040ez   *Earned income includes wages, salaries, tips, professional fees, and other compensation received for personal services you performed. Free e file 1040ez It also includes any amount received as a scholarship that you must include in your income. Free e file 1040ez Generally, your earned income is the total of the amount(s) you reported on Form 1040NR, lines 8,12,13, and 19, minus amounts on lines 27 and 31 (or Form 1040NR-EZ, lines 3 and 5, minus any amount on line 8). Free e file 1040ez Contributions from which you benefit. Free e file 1040ez   If you receive a benefit as a result of making a contribution to a qualified organization, you can deduct only the amount of your contribution that is more than the value of the benefit you receive. Free e file 1040ez   If you pay more than the fair market value to a qualified organization for merchandise, goods, or services, the amount you pay that is more than the value of the item can be a charitable contribution. Free e file 1040ez For the excess amount to qualify, you must pay it with the intent to make a charitable contribution. Free e file 1040ez Cash contributions. Free e file 1040ez   You cannot deduct a cash contribution, regardless of the amount, unless you keep as a record of the contribution a bank record (such as a canceled check, a bank copy of a canceled check, or a bank statement containing the name of the charity, the date, and the amount) or a written record from the charity. Free e file 1040ez The written record must include the name of the charity, date of the contribution, and the amount of the contribution. Free e file 1040ez   You may deduct a cash contribution of $250 or more only if you have a written statement from the charitable organization showing: The amount of any money contributed, Whether the organization gave you any goods or services in return for your contribution, and A description and estimate of the value of any goods or services described in (2). Free e file 1040ez If you received only intangible religious benefits, the organization must state this, but it does not have to describe or value the benefit. Free e file 1040ez Noncash contributions. Free e file 1040ez   For contributions not made in cash, the records you must keep depend on the amount of your deduction. Free e file 1040ez See Publication 526 for details. Free e file 1040ez For example, if you make a noncash contribution and the amount of your deduction is more than $500, you must complete and attach to your tax return Form 8283, Noncash Charitable Contributions. Free e file 1040ez If you deduct more than $500 for a contribution of a motor vehicle, boat, or airplane, you must also attach a statement from the charitable organization to your return. Free e file 1040ez If your total deduction is over $5,000, you also may have to get appraisals of the values of the property. Free e file 1040ez If the donated property is valued at more than $5,000, you must obtain a qualified appraisal. Free e file 1040ez You generally must attach to your tax return an appraisal of any property if your deduction for the property is more than $500,000. Free e file 1040ez See Form 8283 and its instructions for details. Free e file 1040ez Contributions of appreciated property. Free e file 1040ez   If you contribute property to a qualified organization, the amount of your charitable contribution is generally the fair market value of the property at the time of the contribution. Free e file 1040ez However, if you contribute property with a fair market value that is more than your basis in it, you may have to reduce the fair market value by the amount of appreciation (increase in value) when you figure your deduction. Free e file 1040ez Your basis in the property is generally what you paid for it. Free e file 1040ez If you need more information about basis, get Publication 551, Basis of Assets. Free e file 1040ez   Different rules apply to figuring your deduction, depending on whether the property is: Ordinary income property, or Capital gain property. Free e file 1040ez For information about these rules, see Publication 526. Free e file 1040ez Limit. Free e file 1040ez   The amount you can deduct in a tax year is limited in the same way it is for a citizen or resident of the United States. Free e file 1040ez For a discussion of limits on charitable contributions and other information, get Publication 526. Free e file 1040ez Casualty and theft losses. Free e file 1040ez   You can deduct your loss from fire, storm, shipwreck, or other casualty, or theft of property even though your property is not connected with a U. Free e file 1040ez S. Free e file 1040ez trade or business. Free e file 1040ez The property can be personal use property or income-producing property not connected with a U. Free e file 1040ez S. Free e file 1040ez trade or business. Free e file 1040ez The property must be located in the United States at the time of the casualty or theft. Free e file 1040ez You can deduct theft losses only in the year in which you discover the loss. Free e file 1040ez   The amount of the loss is the fair market value of the property immediately before the casualty or theft less its fair market value immediately after the casualty or theft (but not more than its cost or adjusted basis) less any insurance or other reimbursement. Free e file 1040ez The fair market value of property immediately after a theft is considered zero, because you no longer have the property. Free e file 1040ez   If your property is covered by insurance, you should file a timely insurance claim for reimbursement. Free e file 1040ez If you do not, you cannot deduct this loss as a casualty or theft loss. Free e file 1040ez   Figure your deductible casualty and theft losses on Form 4684, Casualties and Thefts. Free e file 1040ez Losses from personal use property. Free e file 1040ez    You cannot deduct the first $100 of each casualty or theft loss to property held for personal use. Free e file 1040ez You can deduct only the total of these losses for the year (reduced by the $100 limit) that is more than 10% of your adjusted gross income (line 37, Form 1040NR) for the year. Free e file 1040ez Losses from income-producing property. Free e file 1040ez   These losses are not subject to the limitations that apply to personal use property. Free e file 1040ez Use Section B of Form 4684 to figure your deduction for these losses. Free e file 1040ez Job expenses and other miscellaneous deductions. Free e file 1040ez   You can deduct job expenses, such as allowable unreimbursed travel expenses (discussed next), and other miscellaneous deductions. Free e file 1040ez Generally, the allowable deductions must be related to effectively connected income. Free e file 1040ez Deductible expenses include: Union dues, Safety equipment and small tools needed for your job, Dues to professional organizations, Subscriptions to professional journals, Tax return preparation fees, and Casualty and theft losses of property used in performing services as an employee (employee property). Free e file 1040ez   Most miscellaneous itemized deductions are deductible only if they are more than 2% of your adjusted gross income (line 37, Form 1040NR). Free e file 1040ez For more information on miscellaneous deductions, see the instructions for Form 1040NR. Free e file 1040ez Travel expenses. Free e file 1040ez   You may be able to deduct your ordinary and necessary travel expenses while you are temporarily performing personal services in the United States. Free e file 1040ez Generally, a temporary assignment in a single location is one that is realistically expected to last (and does in fact last) for one year or less. Free e file 1040ez You must be able to show you were present in the United States on an activity that required your temporary absence from your regular place of work. Free e file 1040ez   For example, if you have established a “tax home” through regular employment in a foreign country, and intend to return to similar employment in the same country at the end of your temporary stay in the United States, you can deduct reasonable travel expenses you paid. Free e file 1040ez You cannot deduct travel expenses for other members of your family or party. Free e file 1040ez Deductible travel expenses. Free e file 1040ez   If you qualify, you can deduct your expenses for: Transportation—airfare, local transportation, including train, bus, etc. Free e file 1040ez , Lodging—rent paid, utilities (do not include telephone), hotel or motel room expenses, and Meal expenses—actual expenses allowed if you keep records of the amounts, or, if you do not wish to keep detailed records, you are generally allowed a standard meal allowance amount depending on the date and area of your travel. Free e file 1040ez You generally can deduct only 50% of unreimbursed meal expenses. Free e file 1040ez The standard meal allowance rates for high-cost areas are available at www. Free e file 1040ez gsa. Free e file 1040ez gov/perdiem. Free e file 1040ez The rates for other areas are in Publication 463. Free e file 1040ez   Use Form 2106 or 2106-EZ to figure your allowable expenses that you claim on line 7 of Schedule A (Form 1040NR). Free e file 1040ez Expenses allocable to U. Free e file 1040ez S. Free e file 1040ez tax-exempt income. Free e file 1040ez   You cannot deduct an expense, or part of an expense, that is allocable to U. Free e file 1040ez S. Free e file 1040ez tax-exempt income, including income exempt by tax treaty. Free e file 1040ez Example. Free e file 1040ez Irina Oak, a citizen of Poland, resided in the United States for part of the year to acquire business experience from a U. Free e file 1040ez S. Free e file 1040ez company. Free e file 1040ez During her stay in the United States, she received a salary of $8,000 from her Polish employer. Free e file 1040ez She received no other U. Free e file 1040ez S. Free e file 1040ez source income. Free e file 1040ez She spent $3,000 on travel expenses, of which $1,000 were for meals. Free e file 1040ez None of these expenses were reimbursed. Free e file 1040ez Under the tax treaty with Poland, $5,000 of her salary is exempt from U. Free e file 1040ez S. Free e file 1040ez income tax. Free e file 1040ez In filling out Form 2106-EZ, she must reduce her deductible meal expenses by half ($500). Free e file 1040ez She must reduce the remaining $2,500 of travel expenses by 62. Free e file 1040ez 5% ($1,563) because 62. Free e file 1040ez 5% ($5,000 ÷ $8,000) of her salary is exempt from tax. Free e file 1040ez She enters the remaining total of $937 on line 7 of Schedule A (Form 1040NR). Free e file 1040ez She completes the remaining lines according to the instructions for Schedule A. Free e file 1040ez More information. Free e file 1040ez   For more information about deductible expenses, reimbursements, and recordkeeping, get Publication 463. Free e file 1040ez Tax Credits and Payments This discussion covers tax credits and payments for resident aliens, followed by a discussion of the credits and payments for nonresident aliens. Free e file 1040ez Resident Aliens Resident aliens generally claim tax credits and report tax payments, including withholding, using the same rules that apply to U. Free e file 1040ez S. Free e file 1040ez citizens. Free e file 1040ez The following items are some of the credits you may be able to claim. Free e file 1040ez Foreign tax credit. Free e file 1040ez   You can claim a credit, subject to certain limits, for income tax you paid or accrued to a foreign country on foreign source income. Free e file 1040ez You cannot claim a credit for taxes paid or accrued on excluded foreign earned income. Free e file 1040ez To claim a credit for income taxes paid or accrued to a foreign country, you generally will file Form 1116, Foreign Tax Credit (Individual, Estate, or Trust), with your Form 1040. Free e file 1040ez   For more information, get Publication 514, Foreign Tax Credit for Individuals. Free e file 1040ez Child and dependent care credit. Free e file 1040ez   You may be able to take this credit if you pay someone to care for your qualifying child who is under age 13, or your disabled dependent or disabled spouse, so that you can work or look for work. Free e file 1040ez Generally, you must be able to claim an exemption for your dependent. Free e file 1040ez   For more information, get Publication 503, Child and Dependent Care Expenses, and Form 2441, Child and Dependent Care Expenses. Free e file 1040ez Credit for the elderly or the disabled. Free e file 1040ez   You may qualify for this credit if you are 65 or older or if you retired on permanent and total disability. Free e file 1040ez For more information on this credit, get Publication 524, Credit for the Elderly or the Disabled, and Schedule R (Form 1040A or 1040). Free e file 1040ez Education credits. Free e file 1040ez   You may qualify for these credits if you paid qualified education expenses for yourself, your spouse, or your dependent. Free e file 1040ez There are two education credits: the American Opportunity Credit and the lifetime learning credit. Free e file 1040ez You cannot claim these credits if you are married filing separately. Free e file 1040ez Use Form 8863, Education Credits (American Opportunity and Lifetime Learning Credits), to figure the credit. Free e file 1040ez For more information, see Publication 970. Free e file 1040ez Retirement savings contributions credit. Free e file 1040ez   You may qualify for this credit (also known as the saver's credit) if you made eligible contributions to an employer-sponsored retirement plan or to an individual retirement arrangement (IRA) in 2013. Free e file 1040ez You cannot claim this credit if: You were born after January 1, 1996, You were a full-time student, Your exemption is claimed by someone else on his or her 2013 tax return, or Your adjusted gross income is more than: $59,000, if your filing status is married filing jointly, $44,250, if your filing status is head of household, or $29,500, if your filing status is single, married filing separately, or qualifying widow(er). Free e file 1040ez Use Form 8880, Credit for Qualified Retirement Savings Contributions, to figure the credit. Free e file 1040ez For more information, see Publication 590. Free e file 1040ez Child tax credit. Free e file 1040ez   You may be able to take this credit if you have a qualifying child. Free e file 1040ez   A qualifying child for purposes of the child tax credit is a child who: Was under age 17 at the end of 2013. Free e file 1040ez Is your son, daughter, stepchild, foster child, brother, sister, stepbrother, stepsister, half brother, half sister, or a descendant of any of them (for example, your grandchild, niece, or nephew). Free e file 1040ez Is a U. Free e file 1040ez S. Free e file 1040ez citizen, a U. Free e file 1040ez S. Free e file 1040ez national, or a resident alien. Free e file 1040ez Did not provide over half of his or her own support for 2013. Free e file 1040ez Lived with you more than half of 2013. Free e file 1040ez Temporary absences, such as for school, vacation, or medical care, count as time lived in the home. Free e file 1040ez Is claimed as a dependent on your return. Free e file 1040ez An adopted child is always treated as your own child. Free e file 1040ez An adopted child includes a child lawfully placed with you for legal adoption. Free e file 1040ez   See your form instructions for additional details. Free e file 1040ez Adoption credit. Free e file 1040ez   You may qualify to take a tax credit of up to $12,970 for qualifying expenses paid to adopt an eligible child. Free e file 1040ez This amount may be allowed for the adoption of a child with special needs regardless of whether you have qualifying expenses. Free e file 1040ez To claim the adoption credit, file Form 8839, Qualified Adoption Expenses, with your Form 1040. Free e file 1040ez Earned income credit. Free e file 1040ez   You may qualify for an earned income credit of up to $3,250 if a child lived with you in the United States and your earned income and adjusted gross income were each less than $37,870 ($43,210 if married filing jointly). Free e file 1040ez If two children lived with you in the United States and your earned income and adjusted gross income were each less than $43,038 ($48,378 if married filing jointly), your credit could be as much as $5,372. Free e file 1040ez If three or more children lived with you in the United States and your earned income and adjusted gross income were each less than $46,227 ($51,567 if married filing jointly), your credit could be as much as $6,044. Free e file 1040ez If you do not have a qualifying child and your earned income and adjusted gross income were each less than $14,340 ($19,680 if married filing jointly), your credit could be as much as $487. Free e file 1040ez You cannot claim the earned income credit if your filing status is married filing separately. Free e file 1040ez    You and your spouse (if filing a joint return) and any qualifying child must have valid SSNs to claim this credit. Free e file 1040ez You cannot claim the credit using an ITIN. Free e file 1040ez If a social security card has a legend that says Not Valid for Employment and the number was issued so that you (or your spouse or your qualifying child) could receive a federally funded benefit, you cannot claim the earned income credit. Free e file 1040ez An example of a federally funded benefit is Medicaid. Free e file 1040ez If a card has this legend and the individual's immigration status has changed so that the individual is now a U. Free e file 1040ez S. Free e file 1040ez citizen or lawful permanent resident, ask the SSA to issue a new social security card without the legend. Free e file 1040ez Other information. Free e file 1040ez   There are other eligibility rules that are not discussed here. Free e file 1040ez For more information, get Publication 596, Earned Income Credit. Free e file 1040ez Nonresident Aliens You can claim some of the same credits that resident aliens can claim. Free e file 1040ez You can also report certain taxes you paid, are considered to have paid, or that were withheld from your income. Free e file 1040ez Credits Credits are allowed only if you receive effectively connected income. Free e file 1040ez You may be able to claim some of the following credits. Free e file 1040ez Foreign tax credit. Free e file 1040ez   If you receive foreign source income that is effectively connected with a trade or business in the United States, you can claim a credit for any income taxes paid or accrued to any foreign country or U. Free e file 1040ez S. Free e file 1040ez possession on that income. Free e file 1040ez   If you do not have foreign source income effectively connected with a U. Free e file 1040ez S. Free e file 1040ez trade or business, you cannot claim credits against your U. Free e file 1040ez S. Free e file 1040ez tax for taxes paid or accrued to a foreign country or U. Free e file 1040ez S. Free e file 1040ez possession. Free e file 1040ez   You cannot take any credit for taxes imposed by a foreign country or U. Free e file 1040ez S. Free e file 1040ez possession on your U. Free e file 1040ez S. Free e file 1040ez source income if those taxes were imposed only because you are a citizen or resident of the foreign country or possession. Free e file 1040ez   If you claim a foreign tax credit, you generally will have to attach to your return a Form 1116. Free e file 1040ez See Publication 514 for more information. Free e file 1040ez Child and dependent care credit. Free e file 1040ez   You may qualify for this credit if you pay someone to care for your qualifying child who is under age 13, or your disabled dependent or disabled spouse, so that you can work or look for work. Free e file 1040ez Generally, you must be able to claim an exemption for your dependent. Free e file 1040ez   Married nonresident aliens can claim the credit only if they choose to file a joint return with a U. Free e file 1040ez S. Free e file 1040ez citizen or resident spouse as discussed in chapter 1, or if they qualify as certain married individuals living apart (see Joint Return Test in Publication 503). Free e file 1040ez   The amount of your child and dependent care expense that qualifies for the credit in any tax year cannot be more than your earned income from the United States for that tax year. Free e file 1040ez Earned income generally means wages, salaries, and professional fees for personal services performed. Free e file 1040ez   For more information, get Publication 503. Free e file 1040ez Education credits. Free e file 1040ez   If you are a nonresident alien for any part of the year, you generally cannot claim the education credits. Free e file 1040ez However, if you are married and choose to file a joint return with a U. Free e file 1040ez S. Free e file 1040ez citizen or resident spouse as discussed in chapter 1, you may be eligible for these credits. Free e file 1040ez Retirement savings contributions credit. Free e file 1040ez   You may qualify for this credit (also known as the saver's credit) if you made eligible contributions to an employer-sponsored retirement plan or to an individual retirement arrangement (IRA) in 2013. Free e file 1040ez You cannot claim this credit if: You were born after January 1, 1996, You were a full-time student, Your exemption is claimed by someone else on his or her 2013 tax return, or Your adjusted gross income is more than $29,500. Free e file 1040ez Use Form 8880 to figure the credit. Free e file 1040ez For more information, see Publication 590. Free e file 1040ez Child tax credit. Free e file 1040ez   You may be able to take this credit if you have a qualifying child. Free e file 1040ez   A qualifying child for purposes of the child tax credit is a child who: Was under age 17 at the end of 2013. Free e file 1040ez Is your son, daughter, stepchild, foster child, brother, sister, stepbrother, stepsister, half brother, half sister, or a descendant of any of them (for example, your grandchild, niece, or nephew). Free e file 1040ez Is a U. Free e file 1040ez S. Free e file 1040ez citizen, a U. Free e file 1040ez S. Free e file 1040ez national, or a resident alien. Free e file 1040ez Did not provide over half of his or her own support for 2013. Free e file 1040ez Lived with you more than half of 2013. Free e file 1040ez Temporary absences, such as for school, vacation, or medical care, count as time lived in the home. Free e file 1040ez Is claimed as a dependent on your return. Free e file 1040ez An adopted child is always treated as your own child. Free e file 1040ez An adopted child includes a child lawfully placed with you for legal adoption. Free e file 1040ez   See your form instructions for additional details. Free e file 1040ez Adoption credit. Free e file 1040ez   You may qualify to take a tax credit of up to $12,970 for qualifying expenses paid to adopt an eligible child. Free e file 1040ez This amount may be allowed for the adoption of a child with special needs regardless of whether you have qualifying expenses. Free e file 1040ez To claim the adoption credit, file Form 8839 with your Form 1040NR. Free e file 1040ez   Married nonresident aliens can claim the credit only if they choose to file a joint return with a U. Free e file 1040ez S. Free e file 1040ez citizen or resident spouse as discussed in chapter 1, or if they qualify as certain married individuals living apart (see Married Persons Not Filing Jointly in the Form 8839 instructions). Free e file 1040ez Credit for prior year minimum tax. Free e file 1040ez   If you paid alternative minimum tax in a prior year, get Form 8801, Credit for Prior Year Minimum Tax—Individuals, Estates, and Trusts, to see if you qualify for this credit. Free e file 1040ez Earned income credit. Free e file 1040ez   If you are a nonresident alien for any part of the tax year, you generally cannot get the earned income credit. Free e file 1040ez However, if you are married and choose to file a joint return with a U. Free e file 1040ez S. Free e file 1040ez citizen or resident spouse as discussed in chapter 1, you may be eligible for the credit. Free e file 1040ez    You, your spouse, and any qualifying child must have valid SSNs to claim this credit. Free e file 1040ez You cannot claim the credit using an ITIN. Free e file 1040ez If a social security card has a legend that says Not Valid for Employment and the number was issued so that you (or your spouse or your qualifying child) could receive a federally funded benefit, you cannot claim the earned income credit. Free e file 1040ez An example of a federally funded benefit is Medicaid. Free e file 1040ez If a card has this legend and the individual's immigration status has changed so that the individual is now a U. Free e file 1040ez S. Free e file 1040ez citizen or lawful permanent resident, ask the SSA to issue a new social security card without the legend. Free e file 1040ez   See Publication 596 for more information on the credit. Free e file 1040ez Tax Withheld You can claim the tax withheld during the year as a payment against your U. Free e file 1040ez S. Free e file 1040ez tax. Free e file 1040ez You claim it on line 61 of Form 1040NR or on line 18 of Form 1040NR-EZ. Free e file 1040ez The tax withheld reduces any tax you owe with Form 1040NR or Form 1040NR-EZ. Free e file 1040ez Withholding from wages. Free e file 1040ez   Any federal income tax withheld from your wages during the tax year while you were a nonresident alien is allowed as a payment against your U. Free e file 1040ez S. Free e file 1040ez income tax liability for the same year. Free e file 1040ez You can claim the income tax withheld whether or not you were engaged in a trade or business in the United States during the year, and whether or not the wages (or any other income) were connected with a trade or business in the United States. Free e file 1040ez Excess social security tax withheld. Free e file 1040ez   If you have two or more employers, you may be able to claim a credit against your U. Free e file 1040ez S. Free e file 1040ez income tax liability for social security tax withheld in excess of the maximum required. Free e file 1040ez See Social Security and Medicare Taxes in chapter 8 for more information. Free e file 1040ez Additional Medicare Tax. Free e file 1040ez   Your employer is responsible for withholding the 0. Free e file 1040ez 9% Additional Medicare Tax on Medicare wages or RRTA compensation it pays to you in excess of $200,000 in 2013. Free e file 1040ez If you do not owe Additional Medicare Tax, you can claim a credit for any withheld Additional Medicare Tax against the total tax liability shown on your tax return by filing Form 8959. Free e file 1040ez Tax paid on undistributed long-term capital gains. Free e file 1040ez   If you are a shareholder in a mutual fund (or other regulated investment company) or real estate investment trust, you can claim a credit for your share of any taxes paid by the company on its undistributed long-term capital gains. Free e file 1040ez You will receive information on Form 2439, Notice to Shareholder of Undistributed Long-Term Capital Gains, which you must attach to your return. Free e file 1040ez Tax withheld at the source. Free e file 1040ez   You can claim as a payment any tax withheld at the source on investment and other fixed or determinable annual or periodic income paid to you. Free e file 1040ez Fixed or determinable income includes interest, dividend, rental, and royalty income that you do not claim to be effectively connected income. Free e file 1040ez Wage or salary payments can be fixed or determinable income to you, but usually are subject to withholding as discussed above. Free e file 1040ez Taxes on fixed or determinable income are withheld at a 30% rate or at a lower treaty rate. Free e file 1040ez Tax withheld on partnership income. Free e file 1040ez   If you are a foreign partner in a partnership, the partnership will withhold tax on your share of effectively connected taxable income from the partnership. Free e file 1040ez The partnership will give you a statement on Form 8805, Foreign Partner's Information Statement of Section 1446 Withholding Tax, showing the tax withheld. Free e file 1040ez A partnership that is publicly traded may withhold on your actual distributions of effectively connected income. Free e file 1040ez In this case, the partnership will give you a statement on Form 1042-S. Free e file 1040ez Claim the tax withheld as a payment on line 61b or 61d of Form 1040NR, as appropriate. Free e file 1040ez Claiming tax withheld on your return. Free e file 1040ez   When you fill out your tax return, take extra care to enter the correct amount of any tax withheld shown on your information documents. Free e file 1040ez The following table lists some of the more common information documents and shows where to find the amount of tax withheld. Free e file 1040ez Form number Location  of tax  withheld RRB-1042S Box 12 SSA-1042S Box 9 W-2 Box 2 W-2c Box 2 1042-S Box 9 8805 Line 10 8288-A Box 2 Bona Fide Residents of American Samoa or Puerto Rico If you are a nonresident alien who is a bona fide resident of American Samoa or Puerto Rico for the entire tax year, you generally are taxed the same as resident aliens. Free e file 1040ez You should file Form 1040 and report all income from sources both in and outside the United States. Free e file 1040ez However, you can exclude the income discussed in the following paragraphs. Free e file 1040ez For tax purposes other than reporting income, however, you will be treated as a nonresident alien. Free e file 1040ez For example, you are not allowed the standard deduction, you cannot file a joint return, and you are not allowed a deduction for a dependent unless that person is a citizen or national of the United States. Free e file 1040ez There are also limits on what deductions and credits are allowed. Free e file 1040ez See Nonresident Aliens under Deductions , Itemized Deductions , and Tax Credits and Payments in this chapter. Free e file 1040ez Residents of Puerto Rico. Free e file 1040ez   If you are a bona fide resident of Puerto Rico for the entire year, you can exclude from gross income all income from sources in Puerto Rico (other than amounts for services performed as an employee of the United States or any of its agencies). Free e file 1040ez   If you report income on a calendar year basis and you do not have wages subject to withholding, file your return and pay your tax by June 15. Free e file 1040ez You must also make your first payment of estimated tax by June 15. Free e file 1040ez You cannot file a joint income tax return or make joint payments of estimated tax. Free e file 1040ez However, if you are married to a U. Free e file 1040ez S. Free e file 1040ez citizen or resident, see Nonresident Spouse Treated as a Resident in chapter 1. Free e file 1040ez   If you earn wages subject to withholding, your U. Free e file 1040ez S. Free e file 1040ez income tax return is due by April 15. Free e file 1040ez Your first payment of estimated tax is also due by April 15. Free e file 1040ez For information on withholding and estimated tax, see chapter 8 . Free e file 1040ez Residents of American Samoa. Free e file 1040ez   If you are a bona fide resident of American Samoa for the entire year, you can exclude from gross income all income from sources in American Samoa (other than amounts for services performed as an employee of the U. Free e file 1040ez S. Free e file 1040ez government or any of its agencies). Free e file 1040ez An employee of the American Samoan government is not considered an employee of the U. Free e file 1040ez S. Free e file 1040ez government or any of its agencies for purposes of the exclusion. Free e file 1040ez For more information about this exclusion, get Form 4563 and Publication 570, Tax Guide for Individuals With Income From U. Free e file 1040ez S. Free e file 1040ez Possessions. 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The Free E File 1040ez

Free e file 1040ez 22. Free e file 1040ez   Taxes Table of Contents IntroductionIndian tribal government. Free e file 1040ez Useful Items - You may want to see: Tests To Deduct Any Tax Income TaxesState and Local Income Taxes Foreign Income Taxes General Sales TaxesMotor vehicles. Free e file 1040ez Real Estate TaxesReal estate taxes for prior years. Free e file 1040ez Examples. Free e file 1040ez Form 1099-S. Free e file 1040ez Real Estate-Related Items You Cannot Deduct Personal Property Taxes Taxes and Fees You Cannot Deduct Where To Deduct Introduction This chapter discusses which taxes you can deduct if you itemize deductions on Schedule A (Form 1040). Free e file 1040ez It also explains which taxes you can deduct on other schedules or forms and which taxes you cannot deduct. Free e file 1040ez This chapter covers the following topics. Free e file 1040ez Income taxes (federal, state, local, and foreign). Free e file 1040ez General sales taxes (state and local). Free e file 1040ez Real estate taxes (state, local, and foreign). Free e file 1040ez Personal property taxes (state and local). Free e file 1040ez Taxes and fees you cannot deduct. Free e file 1040ez Use Table 22-1 as a guide to determine which taxes you can deduct. Free e file 1040ez The end of the chapter contains a section that explains which forms you use to deduct different types of taxes. Free e file 1040ez Business taxes. Free e file 1040ez   You can deduct certain taxes only if they are ordinary and necessary expenses of your trade or business or of producing income. Free e file 1040ez For information on these taxes, see Publication 535, Business Expenses. Free e file 1040ez State or local taxes. Free e file 1040ez   These are taxes imposed by the 50 states, U. Free e file 1040ez S. Free e file 1040ez possessions, or any of their political subdivisions (such as a county or city), or by the District of Columbia. Free e file 1040ez Indian tribal government. Free e file 1040ez   An Indian tribal government recognized by the Secretary of the Treasury as performing substantial government functions will be treated as a state for purposes of claiming a deduction for taxes. Free e file 1040ez Income taxes, real estate taxes, and personal property taxes imposed by that Indian tribal government (or by any of its subdivisions that are treated as political subdivisions of a state) are deductible. Free e file 1040ez General sales taxes. Free e file 1040ez   These are taxes imposed at one rate on retail sales of a broad range of classes of items. Free e file 1040ez Foreign taxes. Free e file 1040ez   These are taxes imposed by a foreign country or any of its political subdivisions. Free e file 1040ez Useful Items - You may want to see: Publication 514 Foreign Tax Credit for Individuals 530 Tax Information for Homeowners Form (and Instructions) Schedule A (Form 1040) Itemized Deductions Schedule E (Form 1040) Supplemental Income and Loss 1116 Foreign Tax Credit Tests To Deduct Any Tax The following two tests must be met for you to deduct any tax. Free e file 1040ez The tax must be imposed on you. Free e file 1040ez You must pay the tax during your tax year. Free e file 1040ez The tax must be imposed on you. Free e file 1040ez   In general, you can deduct only taxes imposed on you. Free e file 1040ez   Generally, you can deduct property taxes only if you are an owner of the property. Free e file 1040ez If your spouse owns the property and pays the real estate taxes, the taxes are deductible on your spouse's separate return or on your joint return. Free e file 1040ez You must pay the tax during your tax year. Free e file 1040ez   If you are a cash basis taxpayer, you can deduct only those taxes you actually paid during your tax year. Free e file 1040ez If you pay your taxes by check, the day you mail or deliver the check is the date of payment, provided the check is honored by the financial institution. Free e file 1040ez If you use a pay-by-phone account (such as a credit card or electronic funds withdrawal), the date reported on the statement of the financial institution showing when payment was made is the date of payment. Free e file 1040ez If you contest a tax liability and are a cash basis taxpayer, you can deduct the tax only in the year you actually pay it (or transfer money or other property to provide for satisfaction of the contested liability). Free e file 1040ez See Publication 538, Accounting Periods and Methods, for details. Free e file 1040ez    If you use an accrual method of accounting, see Publication 538 for more information. Free e file 1040ez Income Taxes This section discusses the deductibility of state and local income taxes (including employee contributions to state benefit funds) and foreign income taxes. Free e file 1040ez State and Local Income Taxes You can deduct state and local income taxes. Free e file 1040ez However, you can elect to deduct state and local general sales taxes instead of state and local income taxes. Free e file 1040ez See General Sales Taxes , later. Free e file 1040ez Exception. Free e file 1040ez    You cannot deduct state and local income taxes you pay on income that is exempt from federal income tax, unless the exempt income is interest income. Free e file 1040ez For example, you cannot deduct the part of a state's income tax that is on a cost-of-living allowance exempt from federal income tax. Free e file 1040ez What To Deduct Your deduction may be for withheld taxes, estimated tax payments, or other tax payments as follows. Free e file 1040ez Withheld taxes. Free e file 1040ez   You can deduct state and local income taxes withheld from your salary in the year they are withheld. Free e file 1040ez Your Form(s) W-2 will show these amounts. Free e file 1040ez Forms W-2G, 1099-G, 1099-R, and 1099-MISC may also show state and local income taxes withheld. Free e file 1040ez Estimated tax payments. Free e file 1040ez   You can deduct estimated tax payments you made during the year to a state or local government. Free e file 1040ez However, you must have a reasonable basis for making the estimated tax payments. Free e file 1040ez Any estimated state or local tax payments that are not made in good faith at the time of payment are not deductible. Free e file 1040ez For example, you made an estimated state income tax payment. Free e file 1040ez However, the estimate of your state tax liability shows that you will get a refund of the full amount of your estimated payment. Free e file 1040ez You had no reasonable basis to believe you had any additional liability for state income taxes and you cannot deduct the estimated tax payment. Free e file 1040ez Refund applied to taxes. Free e file 1040ez   You can deduct any part of a refund of prior-year state or local income taxes that you chose to have credited to your 2013 estimated state or local income taxes. Free e file 1040ez    Do not reduce your deduction by either of the following items. Free e file 1040ez Any state or local income tax refund (or credit) you expect to receive for 2013. Free e file 1040ez Any refund of (or credit for) prior-year state and local income taxes you actually received in 2013. Free e file 1040ez   However, part or all of this refund (or credit) may be taxable. Free e file 1040ez See Refund (or credit) of state or local income taxes , later. Free e file 1040ez Separate federal returns. Free e file 1040ez   If you and your spouse file separate state, local, and federal income tax returns, you each can deduct on your federal return only the amount of your own state and local income tax that you paid during the tax year. Free e file 1040ez Joint state and local returns. Free e file 1040ez   If you and your spouse file joint state and local returns and separate federal returns, each of you can deduct on your separate federal return a part of the total state and local income taxes paid during the tax year. Free e file 1040ez You can deduct only the amount of the total taxes that is proportionate to your gross income compared to the combined gross income of you and your spouse. Free e file 1040ez However, you cannot deduct more than the amount you actually paid during the year. Free e file 1040ez You can avoid this calculation if you and your spouse are jointly and individually liable for the full amount of the state and local income taxes. Free e file 1040ez If so, you and your spouse can deduct on your separate federal returns the amount you each actually paid. Free e file 1040ez Joint federal return. Free e file 1040ez   If you file a joint federal return, you can deduct the total of the state and local income taxes both of you paid. Free e file 1040ez Contributions to state benefit funds. Free e file 1040ez    As an employee, you can deduct mandatory contributions to state benefit funds withheld from your wages that provide protection against loss of wages. Free e file 1040ez For example, certain states require employees to make contributions to state funds providing disability or unemployment insurance benefits. Free e file 1040ez Mandatory payments made to the following state benefit funds are deductible as state income taxes on Schedule A (Form 1040), line 5. Free e file 1040ez Alaska Unemployment Compensation Fund. Free e file 1040ez California Nonoccupational Disability Benefit Fund. Free e file 1040ez New Jersey Nonoccupational Disability Benefit Fund. Free e file 1040ez New Jersey Unemployment Compensation Fund. Free e file 1040ez New York Nonoccupational Disability Benefit Fund. Free e file 1040ez Pennsylvania Unemployment Compensation Fund. Free e file 1040ez Rhode Island Temporary Disability Benefit Fund. Free e file 1040ez Washington State Supplemental Workmen's Compensation Fund. Free e file 1040ez    Employee contributions to private or voluntary disability plans are not deductible. Free e file 1040ez Refund (or credit) of state or local income taxes. Free e file 1040ez   If you receive a refund of (or credit for) state or local income taxes in a year after the year in which you paid them, you may have to include the refund in income on Form 1040, line 10, in the year you receive it. Free e file 1040ez This includes refunds resulting from taxes that were overwithheld, applied from a prior year return, not figured correctly, or figured again because of an amended return. Free e file 1040ez If you did not itemize your deductions in the previous year, do not include the refund in income. Free e file 1040ez If you deducted the taxes in the previous year, include all or part of the refund on Form 1040, line 10, in the year you receive the refund. Free e file 1040ez For a discussion of how much to include, see Recoveries in chapter 12. Free e file 1040ez Foreign Income Taxes Generally, you can take either a deduction or a credit for income taxes imposed on you by a foreign country or a U. Free e file 1040ez S. Free e file 1040ez possession. Free e file 1040ez However, you cannot take a deduction or credit for foreign income taxes paid on income that is exempt from U. Free e file 1040ez S. Free e file 1040ez tax under the foreign earned income exclusion or the foreign housing exclusion. Free e file 1040ez For information on these exclusions, see Publication 54, Tax Guide for U. Free e file 1040ez S. Free e file 1040ez Citizens and Resident Aliens Abroad. Free e file 1040ez For information on the foreign tax credit, see Publication 514. Free e file 1040ez General Sales Taxes You can elect to deduct state and local general sales taxes, instead of state and local income taxes, as an itemized deduction on Schedule A (Form 1040), line 5b. Free e file 1040ez You can use either your actual expenses or the state and local sales tax tables to figure your sales tax deduction. Free e file 1040ez Actual expenses. Free e file 1040ez   Generally, you can deduct the actual state and local general sales taxes (including compensating use taxes) if the tax rate was the same as the general sales tax rate. Free e file 1040ez However, sales taxes on food, clothing, medical supplies, and motor vehicles are deductible as a general sales tax even if the tax rate was less than the general sales tax rate. Free e file 1040ez If you paid sales tax on a motor vehicle at a rate higher than the general sales tax rate, you can deduct only the amount of tax that you would have paid at the general sales tax rate on that vehicle. Free e file 1040ez If you use the actual expenses method, you must have receipts to show the general sales taxes paid. Free e file 1040ez Do not include sales taxes paid on items used in your trade or business. Free e file 1040ez Motor vehicles. Free e file 1040ez   For purposes of this section, motor vehicles include cars, motorcycles, motor homes, recreational vehicles, sport utility vehicles, trucks, vans, and off-road vehicles. Free e file 1040ez This also includes sales taxes on a leased motor vehicle, but not on vehicles used in your trade or business. Free e file 1040ez Optional sales tax tables. Free e file 1040ez   Instead of using your actual expenses, you can figure your state and local general sales tax deduction using the state and local sales tax tables in the Instructions for Schedule A (Form 1040). Free e file 1040ez You may also be able to add the state and local general sales taxes paid on certain specified items. Free e file 1040ez   Your applicable table amount is based on the state where you live, your income, and the number of exemptions claimed on your tax return. Free e file 1040ez Your income is your adjusted gross income plus any nontaxable items such as the following. Free e file 1040ez Tax-exempt interest. Free e file 1040ez Veterans' benefits. Free e file 1040ez Nontaxable combat pay. Free e file 1040ez Workers' compensation. Free e file 1040ez Nontaxable part of social security and railroad retirement benefits. Free e file 1040ez Nontaxable part of IRA, pension, or annuity distributions, excluding rollovers. Free e file 1040ez Public assistance payments. Free e file 1040ez If you lived in different states during the same tax year, you must prorate your applicable table amount for each state based on the days you lived in each state. Free e file 1040ez See the Instructions for Schedule A (Form 1040), line 5, for details. Free e file 1040ez Real Estate Taxes Deductible real estate taxes are any state, local, or foreign taxes on real property levied for the general public welfare. Free e file 1040ez You can deduct these taxes only if they are based on the assessed value of the real property and charged uniformly against all property under the jurisdiction of the taxing authority. Free e file 1040ez Deductible real estate taxes generally do not include taxes charged for local benefits and improvements that increase the value of the property. Free e file 1040ez They also do not include itemized charges for services (such as trash collection) assessed against specific property or certain people, even if the charge is paid to the taxing authority. Free e file 1040ez For more information about taxes and charges that are not deductible, see Real Estate-Related Items You Cannot Deduct , later. Free e file 1040ez Tenant-shareholders in a cooperative housing corporation. Free e file 1040ez   Generally, if you are a tenant-stockholder in a cooperative housing corporation, you can deduct the amount paid to the corporation that represents your share of the real estate taxes the corporation paid or incurred for your dwelling unit. Free e file 1040ez The corporation should provide you with a statement showing your share of the taxes. Free e file 1040ez For more information, see Special Rules for Cooperatives in Publication 530. Free e file 1040ez Division of real estate taxes between buyers and sellers. Free e file 1040ez   If you bought or sold real estate during the year, the real estate taxes must be divided between the buyer and the seller. Free e file 1040ez   The buyer and the seller must divide the real estate taxes according to the number of days in the real property tax year (the period to which the tax is imposed relates) that each owned the property. Free e file 1040ez The seller is treated as paying the taxes up to, but not including, the date of sale. Free e file 1040ez The buyer is treated as paying the taxes beginning with the date of sale. Free e file 1040ez This applies regardless of the lien dates under local law. Free e file 1040ez Generally, this information is included on the settlement statement provided at the closing. Free e file 1040ez    If you (the seller) cannot deduct taxes until they are paid because you use the cash method of accounting, and the buyer of your property is personally liable for the tax, you are considered to have paid your part of the tax at the time of the sale. Free e file 1040ez This lets you deduct the part of the tax to the date of sale even though you did not actually pay it. Free e file 1040ez However, you must also include the amount of that tax in the selling price of the property. Free e file 1040ez The buyer must include the same amount in his or her cost of the property. Free e file 1040ez   You figure your deduction for taxes on each property bought or sold during the real property tax year as follows. Free e file 1040ez Worksheet 22-1. Free e file 1040ez Figuring Your Real Estate Tax Deduction 1. Free e file 1040ez Enter the total real estate taxes for the real property tax year   2. Free e file 1040ez Enter the number of days in the real property tax year that you owned the property   3. Free e file 1040ez Divide line 2 by 365 (for leap years, divide line 2 by 366) . Free e file 1040ez 4. Free e file 1040ez Multiply line 1 by line 3. Free e file 1040ez This is your deduction. Free e file 1040ez Enter it on Schedule A (Form 1040), line 6   Note. Free e file 1040ez Repeat steps 1 through 4 for each property you bought or sold during the real property tax year. Free e file 1040ez Your total deduction is the sum of the line 4 amounts for all of the properties. Free e file 1040ez Real estate taxes for prior years. Free e file 1040ez   Do not divide delinquent taxes between the buyer and seller if the taxes are for any real property tax year before the one in which the property is sold. Free e file 1040ez Even if the buyer agrees to pay the delinquent taxes, the buyer cannot deduct them. Free e file 1040ez The buyer must add them to the cost of the property. Free e file 1040ez The seller can deduct these taxes paid by the buyer. Free e file 1040ez However, the seller must include them in the selling price. Free e file 1040ez Examples. Free e file 1040ez   The following examples illustrate how real estate taxes are divided between buyer and seller. Free e file 1040ez Example 1. Free e file 1040ez Dennis and Beth White's real property tax year for both their old home and their new home is the calendar year, with payment due August 1. Free e file 1040ez The tax on their old home, sold on May 7, was $620. Free e file 1040ez The tax on their new home, bought on May 3, was $732. Free e file 1040ez Dennis and Beth are considered to have paid a proportionate share of the real estate taxes on the old home even though they did not actually pay them to the taxing authority. Free e file 1040ez On the other hand, they can claim only a proportionate share of the taxes they paid on their new property even though they paid the entire amount. Free e file 1040ez Dennis and Beth owned their old home during the real property tax year for 126 days (January 1 to May 6, the day before the sale). Free e file 1040ez They figure their deduction for taxes on their old home as follows. Free e file 1040ez Worksheet 22-1. Free e file 1040ez Figuring Your Real Estate Tax Deduction — Taxes on Old Home 1. Free e file 1040ez Enter the total real estate taxes for the real property tax year $620 2. Free e file 1040ez Enter the number of days in the real property tax year that you owned the property 126 3. Free e file 1040ez Divide line 2 by 365 (for leap years, divide line 2 by 366) . Free e file 1040ez 3452 4. Free e file 1040ez Multiply line 1 by line 3. Free e file 1040ez This is your deduction. Free e file 1040ez Enter it on Schedule A (Form 1040), line 6 $214 Since the buyers of their old home paid all of the taxes, Dennis and Beth also include the $214 in the selling price of the old home. Free e file 1040ez (The buyers add the $214 to their cost of the home. Free e file 1040ez ) Dennis and Beth owned their new home during the real property tax year for 243 days (May 3 to December 31, including their date of purchase). Free e file 1040ez They figure their deduction for taxes on their new home as follows. Free e file 1040ez Worksheet 22-1. Free e file 1040ez Figuring Your Real Estate Tax Deduction — Taxes on New Home 1. Free e file 1040ez Enter the total real estate taxes for the real property tax year $732 2. Free e file 1040ez Enter the number of days in the real property tax year that you owned the property 243 3. Free e file 1040ez Divide line 2 by 365 (for leap years, divide line 2 by 366) . Free e file 1040ez 6658 4. Free e file 1040ez Multiply line 1 by line 3. Free e file 1040ez This is your deduction. Free e file 1040ez Enter it on Schedule A (Form 1040), line 6 $487 Since Dennis and Beth paid all of the taxes on the new home, they add $245 ($732 paid less $487 deduction) to their cost of the new home. Free e file 1040ez (The sellers add this $245 to their selling price and deduct the $245 as a real estate tax. Free e file 1040ez ) Dennis and Beth's real estate tax deduction for their old and new homes is the sum of $214 and $487, or $701. Free e file 1040ez They will enter this amount on Schedule A (Form 1040), line 6. Free e file 1040ez Example 2. Free e file 1040ez George and Helen Brown bought a new home on May 3, 2013. Free e file 1040ez Their real property tax year for the new home is the calendar year. Free e file 1040ez Real estate taxes for 2012 were assessed in their state on January 1, 2013. Free e file 1040ez The taxes became due on May 31, 2013, and October 31, 2013. Free e file 1040ez The Browns agreed to pay all taxes due after the date of purchase. Free e file 1040ez Real estate taxes for 2012 were $680. Free e file 1040ez They paid $340 on May 31, 2013, and $340 on October 31, 2013. Free e file 1040ez These taxes were for the 2012 real property tax year. Free e file 1040ez The Browns cannot deduct them since they did not own the property until 2013. Free e file 1040ez Instead, they must add $680 to the cost of their new home. Free e file 1040ez In January 2014, the Browns receive their 2013 property tax statement for $752, which they will pay in 2014. Free e file 1040ez The Browns owned their new home during the 2013 real property tax year for 243 days (May 3 to December 31). Free e file 1040ez They will figure their 2014 deduction for taxes as follows. Free e file 1040ez Worksheet 22-1. Free e file 1040ez Figuring Your Real Estate Tax Deduction — Taxes on New Home 1. Free e file 1040ez Enter the total real estate taxes for the real property tax year $752 2. Free e file 1040ez Enter the number of days in the real property tax year that you owned the property 243 3. Free e file 1040ez Divide line 2 by 365 (for leap years, divide line 2 by 366) . Free e file 1040ez 6658 4. Free e file 1040ez Multiply line 1 by line 3. Free e file 1040ez This is your deduction. Free e file 1040ez Claim it on Schedule A (Form 1040), line 6 $501 The remaining $251 ($752 paid less $501 deduction) of taxes paid in 2014, along with the $680 paid in 2013, is added to the cost of their new home. Free e file 1040ez Because the taxes up to the date of sale are considered paid by the seller on the date of sale, the seller is entitled to a 2013 tax deduction of $931. Free e file 1040ez This is the sum of the $680 for 2012 and the $251 for the 122 days the seller owned the home in 2013. Free e file 1040ez The seller must also include the $931 in the selling price when he or she figures the gain or loss on the sale. Free e file 1040ez The seller should contact the Browns in January 2014 to find out how much real estate tax is due for 2013. Free e file 1040ez Form 1099-S. Free e file 1040ez   For certain sales or exchanges of real estate, the person responsible for closing the sale (generally the settlement agent) prepares Form 1099-S, Proceeds From Real Estate Transactions, to report certain information to the IRS and to the seller of the property. Free e file 1040ez Box 2 of Form 1099-S is for the gross proceeds from the sale and should include the portion of the seller's real estate tax liability that the buyer will pay after the date of sale. Free e file 1040ez The buyer includes these taxes in the cost basis of the property, and the seller both deducts this amount as a tax paid and includes it in the sales price of the property. Free e file 1040ez   For a real estate transaction that involves a home, any real estate tax the seller paid in advance but that is the liability of the buyer appears on Form 1099-S, box 5. Free e file 1040ez The buyer deducts this amount as a real estate tax, and the seller reduces his or her real estate tax deduction (or includes it in income) by the same amount. Free e file 1040ez See Refund (or rebate) , later. Free e file 1040ez Taxes placed in escrow. Free e file 1040ez   If your monthly mortgage payment includes an amount placed in escrow (put in the care of a third party) for real estate taxes, you may not be able to deduct the total amount placed in escrow. Free e file 1040ez You can deduct only the real estate tax that the third party actually paid to the taxing authority. Free e file 1040ez If the third party does not notify you of the amount of real estate tax that was paid for you, contact the third party or the taxing authority to find the proper amount to show on your return. Free e file 1040ez Tenants by the entirety. Free e file 1040ez   If you and your spouse held property as tenants by the entirety and you file separate federal returns, each of you can deduct only the taxes each of you paid on the property. Free e file 1040ez Divorced individuals. Free e file 1040ez   If your divorce or separation agreement states that you must pay the real estate taxes for a home owned by you and your spouse, part of your payments may be deductible as alimony and part as real estate taxes. Free e file 1040ez See Taxes and insurance in chapter 18 for more information. Free e file 1040ez Ministers' and military housing allowances. Free e file 1040ez   If you are a minister or a member of the uniformed services and receive a housing allowance that you can exclude from income, you still can deduct all of the real estate taxes you pay on your home. Free e file 1040ez Refund (or rebate). Free e file 1040ez   If you received a refund or rebate in 2013 of real estate taxes you paid in 2013, you must reduce your deduction by the amount refunded to you. Free e file 1040ez If you received a refund or rebate in 2013 of real estate taxes you deducted in an earlier year (either as an itemized deduction or an increase to your standard deduction), you generally must include the refund or rebate in income in the year you receive it. Free e file 1040ez However, the amount you include in income is limited to the amount of the deduction that reduced your tax in the earlier year. Free e file 1040ez For more information, see Recoveries in chapter 12. Free e file 1040ez Table 22-1. Free e file 1040ez Which Taxes Can You Deduct? Type of Tax You Can Deduct You Cannot Deduct Fees and Charges Fees and charges that are expenses of your trade or business or of producing income. Free e file 1040ez Fees and charges that are not expenses of your trade or business or of producing income, such as fees for driver's licenses, car inspections, parking, or charges for water bills (see Taxes and Fees You Cannot Deduct ). Free e file 1040ez     Fines and penalties. Free e file 1040ez Income Taxes State and local income taxes. Free e file 1040ez Federal income taxes. Free e file 1040ez   Foreign income taxes. Free e file 1040ez     Employee contributions to state funds listed under Contributions to state benefit funds . Free e file 1040ez Employee contributions to private or voluntary disability plans. Free e file 1040ez     State and local general sales taxes if you choose to deduct state and local income taxes. Free e file 1040ez General Sales Taxes State and local general sales taxes, including compensating use taxes. Free e file 1040ez State and local income taxes if you choose to deduct state and local general sales taxes. Free e file 1040ez Other Taxes Taxes that are expenses of your trade or business. Free e file 1040ez Federal excise taxes, such as tax on gasoline, that are not expenses of your trade or business or of producing income. Free e file 1040ez   Taxes on property producing rent or royalty income. Free e file 1040ez Per capita taxes. Free e file 1040ez   Occupational taxes. Free e file 1040ez See chapter 28. Free e file 1040ez     One-half of self-employment tax paid. Free e file 1040ez   Personal Property Taxes State and local personal property taxes. Free e file 1040ez Customs duties that are not expenses of your trade or business or of producing income. Free e file 1040ez Real Estate Taxes State and local real estate taxes. Free e file 1040ez Real estate taxes that are treated as imposed on someone else (see Division of real estate taxes between buyers and sellers ). Free e file 1040ez   Foreign real estate taxes. Free e file 1040ez Taxes for local benefits (with exceptions). Free e file 1040ez See Real Estate-Related Items You Cannot Deduct . Free e file 1040ez   Tenant's share of real estate taxes paid by  cooperative housing corporation. Free e file 1040ez Trash and garbage pickup fees (with exceptions). Free e file 1040ez See Real Estate-Related Items You Cannot Deduct . Free e file 1040ez     Rent increase due to higher real estate taxes. Free e file 1040ez     Homeowners' association charges. Free e file 1040ez Real Estate-Related Items You Cannot Deduct Payments for the following items generally are not deductible as real estate taxes. Free e file 1040ez Taxes for local benefits. Free e file 1040ez Itemized charges for services (such as trash and garbage pickup fees). Free e file 1040ez Transfer taxes (or stamp taxes). Free e file 1040ez Rent increases due to higher real estate taxes. Free e file 1040ez Homeowners' association charges. Free e file 1040ez Taxes for local benefits. Free e file 1040ez   Deductible real estate taxes generally do not include taxes charged for local benefits and improvements tending to increase the value of your property. Free e file 1040ez These include assessments for streets, sidewalks, water mains, sewer lines, public parking facilities, and similar improvements. Free e file 1040ez You should increase the basis of your property by the amount of the assessment. Free e file 1040ez   Local benefit taxes are deductible only if they are for maintenance, repair, or interest charges related to those benefits. Free e file 1040ez If only a part of the taxes is for maintenance, repair, or interest, you must be able to show the amount of that part to claim the deduction. Free e file 1040ez If you cannot determine what part of the tax is for maintenance, repair, or interest, none of it is deductible. Free e file 1040ez    Taxes for local benefits may be included in your real estate tax bill. Free e file 1040ez If your taxing authority (or mortgage lender) does not furnish you a copy of your real estate tax bill, ask for it. Free e file 1040ez You should use the rules above to determine if the local benefit tax is deductible. Free e file 1040ez Contact the taxing authority if you need additional information about a specific charge on your real estate tax bill. Free e file 1040ez Itemized charges for services. Free e file 1040ez    An itemized charge for services assessed against specific property or certain people is not a tax, even if the charge is paid to the taxing authority. Free e file 1040ez For example, you cannot deduct the charge as a real estate tax if it is: A unit fee for the delivery of a service (such as a $5 fee charged for every 1,000 gallons of water you use), A periodic charge for a residential service (such as a $20 per month or $240 annual fee charged to each homeowner for trash collection), or A flat fee charged for a single service provided by your government (such as a $30 charge for mowing your lawn because it was allowed to grow higher than permitted under your local ordinance). Free e file 1040ez    You must look at your real estate tax bill to determine if any nondeductible itemized charges, such as those listed above, are included in the bill. Free e file 1040ez If your taxing authority (or mortgage lender) does not furnish you a copy of your real estate tax bill, ask for it. Free e file 1040ez Exception. Free e file 1040ez   Service charges used to maintain or improve services (such as trash collection or police and fire protection) are deductible as real estate taxes if: The fees or charges are imposed at a like rate against all property in the taxing jurisdiction, The funds collected are not earmarked; instead, they are commingled with general revenue funds, and Funds used to maintain or improve services are not limited to or determined by the amount of these fees or charges collected. Free e file 1040ez Transfer taxes (or stamp taxes). Free e file 1040ez   Transfer taxes and similar taxes and charges on the sale of a personal home are not deductible. Free e file 1040ez If they are paid by the seller, they are expenses of the sale and reduce the amount realized on the sale. Free e file 1040ez If paid by the buyer, they are included in the cost basis of the property. Free e file 1040ez Rent increase due to higher real estate taxes. Free e file 1040ez   If your landlord increases your rent in the form of a tax surcharge because of increased real estate taxes, you cannot deduct the increase as taxes. Free e file 1040ez Homeowners' association charges. Free e file 1040ez   These charges are not deductible because they are imposed by the homeowners' association, rather than the state or local government. Free e file 1040ez Personal Property Taxes Personal property tax is deductible if it is a state or local tax that is: Charged on personal property, Based only on the value of the personal property, and Charged on a yearly basis, even if it is collected more or less than once a year. Free e file 1040ez A tax that meets the above requirements can be considered charged on personal property even if it is for the exercise of a privilege. Free e file 1040ez For example, a yearly tax based on value qualifies as a personal property tax even if it is called a registration fee and is for the privilege of registering motor vehicles or using them on the highways. Free e file 1040ez If the tax is partly based on value and partly based on other criteria, it may qualify in part. Free e file 1040ez Example. Free e file 1040ez Your state charges a yearly motor vehicle registration tax of 1% of value plus 50 cents per hundredweight. Free e file 1040ez You paid $32 based on the value ($1,500) and weight (3,400 lbs. Free e file 1040ez ) of your car. Free e file 1040ez You can deduct $15 (1% × $1,500) as a personal property tax because it is based on the value. Free e file 1040ez The remaining $17 ($. Free e file 1040ez 50 × 34), based on the weight, is not deductible. Free e file 1040ez Taxes and Fees You Cannot Deduct Many federal, state, and local government taxes are not deductible because they do not fall within the categories discussed earlier. Free e file 1040ez Other taxes and fees, such as federal income taxes, are not deductible because the tax law specifically prohibits a deduction for them. Free e file 1040ez See Table 22-1. Free e file 1040ez Taxes and fees that are generally not deductible include the following items. Free e file 1040ez Employment taxes. Free e file 1040ez This includes social security, Medicare, and railroad retirement taxes withheld from your pay. Free e file 1040ez However, one-half of self-employment tax you pay is deductible. Free e file 1040ez In addition, the social security and other employment taxes you pay on the wages of a household worker may be included in medical expenses that you can deduct or child care expenses that allow you to claim the child and dependent care credit. Free e file 1040ez For more information, see chapters 21 and 32. Free e file 1040ez Estate, inheritance, legacy, or succession taxes. Free e file 1040ez However, you can deduct the estate tax attributable to income in respect of a decedent if you, as a beneficiary, must include that income in your gross income. Free e file 1040ez In that case, deduct the estate tax as a miscellaneous deduction that is not subject to the 2%-of-adjusted-gross-income limit. Free e file 1040ez For more information, see Publication 559, Survivors, Executors, and Administrators. Free e file 1040ez Federal income taxes. Free e file 1040ez This includes income taxes withheld from your pay. Free e file 1040ez Fines and penalties. Free e file 1040ez You cannot deduct fines and penalties paid to a government for violation of any law, including related amounts forfeited as collateral deposits. Free e file 1040ez Gift taxes. Free e file 1040ez License fees. Free e file 1040ez You cannot deduct license fees for personal purposes (such as marriage, driver's, and dog license fees). Free e file 1040ez Per capita taxes. Free e file 1040ez You cannot deduct state or local per capita taxes. Free e file 1040ez Many taxes and fees other than those listed above are also nondeductible, unless they are ordinary and necessary expenses of a business or income producing activity. Free e file 1040ez For other nondeductible items, see Real Estate-Related Items You Cannot Deduct , earlier. Free e file 1040ez Where To Deduct You deduct taxes on the following schedules. Free e file 1040ez State and local income taxes. Free e file 1040ez    These taxes are deducted on Schedule A (Form 1040), line 5, even if your only source of income is from business, rents, or royalties. Free e file 1040ez Check box a on line 5. Free e file 1040ez General sales taxes. Free e file 1040ez   Sales taxes are deducted on Schedule A (Form 1040), line 5. Free e file 1040ez You must check box b on line 5. Free e file 1040ez If you elect to deduct sales taxes, you cannot deduct state and local income taxes on Schedule A (Form 1040), line 5, box a. Free e file 1040ez Foreign income taxes. Free e file 1040ez   Generally, income taxes you pay to a foreign country or U. Free e file 1040ez S. Free e file 1040ez possession can be claimed as an itemized deduction on Schedule A (Form 1040), line 8, or as a credit against your U. Free e file 1040ez S. Free e file 1040ez income tax on Form 1040, line 47. Free e file 1040ez To claim the credit, you may have to complete and attach Form 1116. Free e file 1040ez For more information, see chapter 37, the Form 1040 instructions, or Publication 514. Free e file 1040ez Real estate taxes and personal property taxes. Free e file 1040ez    Real estate and personal property taxes are deducted on Schedule A (Form 1040), lines 6 and 7, respectively, unless they are paid on property used in your business, in which case they are deducted on Schedule C, Schedule C-EZ, or Schedule F (Form 1040). Free e file 1040ez Taxes on property that produces rent or royalty income are deducted on Schedule E (Form 1040). Free e file 1040ez Self-employment tax. Free e file 1040ez    Deduct one-half of your self-employment tax on Form 1040, line 27. Free e file 1040ez Other taxes. Free e file 1040ez    All other deductible taxes are deducted on Schedule A (Form 1040), line 8. Free e file 1040ez Prev  Up  Next   Home   More Online Publications