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Free Turbo Tax 2012

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Free Turbo Tax 2012

Free turbo tax 2012 2. Free turbo tax 2012   Filing Status Table of Contents What's New Introduction Useful Items - You may want to see: Marital StatusDivorced persons. Free turbo tax 2012 Divorce and remarriage. Free turbo tax 2012 Annulled marriages. Free turbo tax 2012 Head of household or qualifying widow(er) with dependent child. Free turbo tax 2012 Considered married. Free turbo tax 2012 Same-sex marriage. Free turbo tax 2012 Spouse died during the year. Free turbo tax 2012 Married persons living apart. Free turbo tax 2012 Single Married Filing JointlyFiling a Joint Return Married Filing SeparatelySpecial Rules Head of HouseholdConsidered Unmarried Keeping Up a Home Qualifying Person Qualifying Widow(er) With Dependent Child What's New Filing status for same-sex married couples. Free turbo tax 2012  If you have a same-sex spouse whom you legally married in a state (or foreign country) that recognizes same-sex marriage, you and your spouse generally must use the married filing jointly or married filing separately filing status on your 2013 return, even if you and your spouse now live in a state (or foreign country) that does not recognize same-sex marriage. Free turbo tax 2012 See Same-sex marriage under Marital Status, later. Free turbo tax 2012 Introduction This chapter helps you determine which filing status to use. Free turbo tax 2012 There are five filing statuses. Free turbo tax 2012 Single. Free turbo tax 2012 Married Filing Jointly. Free turbo tax 2012 Married Filing Separately. Free turbo tax 2012 Head of Household. Free turbo tax 2012 Qualifying Widow(er) With Dependent Child. Free turbo tax 2012 If more than one filing status applies to you, choose the one that will give you the lowest tax. Free turbo tax 2012 You must determine your filing status before you can determine whether you must file a tax return (chapter 1), your standard deduction (chapter 20), and your tax (chapter 30). Free turbo tax 2012 You also use your filing status to determine whether you are eligible to claim certain deductions and credits. Free turbo tax 2012 Useful Items - You may want to see: Publication 501 Exemptions, Standard Deduction, and Filing Information 519 U. Free turbo tax 2012 S. Free turbo tax 2012 Tax Guide for Aliens 555 Community Property Marital Status In general, your filing status depends on whether you are considered unmarried or married. Free turbo tax 2012 Unmarried persons. Free turbo tax 2012   You are considered unmarried for the whole year if, on the last day of your tax year, you are unmarried or legally separated from your spouse under a divorce or separate maintenance decree. Free turbo tax 2012 State law governs whether you are married or legally separated under a divorce or separate maintenance decree. Free turbo tax 2012 Divorced persons. Free turbo tax 2012   If you are divorced under a final decree by the last day of the year, you are considered unmarried for the whole year. Free turbo tax 2012 Divorce and remarriage. Free turbo tax 2012   If you obtain a divorce for the sole purpose of filing tax returns as unmarried individuals, and at the time of divorce you intend to and do, in fact, remarry each other in the next tax year, you and your spouse must file as married individuals in both years. Free turbo tax 2012 Annulled marriages. Free turbo tax 2012    If you obtain a court decree of annulment, which holds that no valid marriage ever existed, you are considered unmarried even if you filed joint returns for earlier years. Free turbo tax 2012 You must file Form 1040X, Amended U. Free turbo tax 2012 S. Free turbo tax 2012 Individual Income Tax Return, claiming single or head of household status for all tax years that are affected by the annulment and are not closed by the statute of limitations for filing a tax return. Free turbo tax 2012 Generally, for a credit or refund, you must file Form 1040X within 3 years (including extensions) after the date you filed your original return or within 2 years after the date you paid the tax, whichever is later. Free turbo tax 2012 If you filed your original return early (for example, March 1), your return is considered filed on the due date (generally April 15). Free turbo tax 2012 However, if you had an extension to file (for example, until October 15) but you filed earlier and we received it on July 1, your return is considered filed on July 1. Free turbo tax 2012 Head of household or qualifying widow(er) with dependent child. Free turbo tax 2012   If you are considered unmarried, you may be able to file as a head of household or as a qualifying widow(er) with a dependent child. Free turbo tax 2012 See Head of Household and Qualifying Widow(er) With Dependent Child to see if you qualify. Free turbo tax 2012 Married persons. Free turbo tax 2012   If you are considered married, you and your spouse can file a joint return or separate returns. Free turbo tax 2012 Considered married. Free turbo tax 2012   You are considered married for the whole year if, on the last day of your tax year, you and your spouse meet any one of the following tests. Free turbo tax 2012 You are married and living together as a married couple. Free turbo tax 2012 You are living together in a common law marriage recognized in the state where you now live or in the state where the common law marriage began. Free turbo tax 2012 You are married and living apart, but not legally separated under a decree of divorce or separate maintenance. Free turbo tax 2012 You are separated under an interlocutory (not final) decree of divorce. Free turbo tax 2012 Same-sex marriage. Free turbo tax 2012   For federal tax purposes, individuals of the same sex are considered married if they were lawfully married in a state (or foreign country) whose laws authorize the marriage of two individuals of the same sex, even if the state (or foreign country) in which they now live does not recognize same-sex marriage. Free turbo tax 2012 The term “spouse” includes an individual married to a person of the same sex if the couple is lawfully married under state (or foreign) law. Free turbo tax 2012 However, individuals who have entered into a registered domestic partnership, civil union, or other similar relationship that is not considered a marriage under state (or foreign) law are not considered married for federal tax purposes. Free turbo tax 2012 For more details, see Publication 501. Free turbo tax 2012 Spouse died during the year. Free turbo tax 2012   If your spouse died during the year, you are considered married for the whole year for filing status purposes. Free turbo tax 2012   If you did not remarry before the end of the tax year, you can file a joint return for yourself and your deceased spouse. Free turbo tax 2012 For the next 2 years, you may be entitled to the special benefits described later under Qualifying Widow(er) With Dependent Child . Free turbo tax 2012   If you remarried before the end of the tax year, you can file a joint return with your new spouse. Free turbo tax 2012 Your deceased spouse's filing status is married filing separately for that year. Free turbo tax 2012 Married persons living apart. Free turbo tax 2012   If you live apart from your spouse and meet certain tests, you may be able to file as head of household even if you are not divorced or legally separated. Free turbo tax 2012 If you qualify to file as head of household instead of married filing separately, your standard deduction will be higher. Free turbo tax 2012 Also, your tax may be lower, and you may be able to claim the earned income credit. Free turbo tax 2012 See Head of Household , later. Free turbo tax 2012 Single Your filing status is single if you are considered unmarried and you do not qualify for another filing status. Free turbo tax 2012 To determine your marital status, see Marital Status , earlier. Free turbo tax 2012 Widow(er). Free turbo tax 2012   Your filing status may be single if you were widowed before January 1, 2013, and did not remarry before the end of 2013. Free turbo tax 2012 You may, however, be able to use another filing status that will give you a lower tax. Free turbo tax 2012 See Head of Household and Qualifying Widow(er) With Dependent Child , later, to see if you qualify. Free turbo tax 2012 How to file. Free turbo tax 2012   You can file Form 1040. Free turbo tax 2012 If you have taxable income of less than $100,000, you may be able to file Form 1040A. Free turbo tax 2012 If, in addition, you have no dependents, and are under 65 and not blind, and meet other requirements, you can file Form 1040EZ. Free turbo tax 2012 If you file Form 1040A or Form 1040, show your filing status as single by checking the box on line 1. Free turbo tax 2012 Use the Single column of the Tax Table or Section A of the Tax Computation Worksheet to figure your tax. Free turbo tax 2012 Married Filing Jointly You can choose married filing jointly as your filing status if you are considered married and both you and your spouse agree to file a joint return. Free turbo tax 2012 On a joint return, you and your spouse report your combined income and deduct your combined allowable expenses. Free turbo tax 2012 You can file a joint return even if one of you had no income or deductions. Free turbo tax 2012 If you and your spouse decide to file a joint return, your tax may be lower than your combined tax for the other filing statuses. Free turbo tax 2012 Also, your standard deduction (if you do not itemize deductions) may be higher, and you may qualify for tax benefits that do not apply to other filing statuses. Free turbo tax 2012 If you and your spouse each have income, you may want to figure your tax both on a joint return and on separate returns (using the filing status of married filing separately). Free turbo tax 2012 You can choose the method that gives the two of you the lower combined tax. Free turbo tax 2012 How to file. Free turbo tax 2012   If you file as married filing jointly, you can use Form 1040. Free turbo tax 2012 If you and your spouse have taxable income of less than $100,000, you may be able to file Form 1040A. Free turbo tax 2012 If, in addition, you and your spouse have no dependents, are both under 65 and not blind, and meet other requirements, you can file Form 1040EZ. Free turbo tax 2012 If you file Form 1040 or Form 1040A, show this filing status by checking the box on line 2. Free turbo tax 2012 Use the Married filing jointly column of the Tax Table or Section B of the Tax Computation Worksheet to figure your tax. Free turbo tax 2012 Spouse died. Free turbo tax 2012   If your spouse died during the year, you are considered married for the whole year and can choose married filing jointly as your filing status. Free turbo tax 2012 See Spouse died during the year under Marital Status, earlier, for more information. Free turbo tax 2012   If your spouse died in 2014 before filing a 2013 return, you can choose married filing jointly as your filing status on your 2013 return. Free turbo tax 2012 Divorced persons. Free turbo tax 2012   If you are divorced under a final decree by the last day of the year, you are considered unmarried for the whole year and you cannot choose married filing jointly as your filing status. Free turbo tax 2012 Filing a Joint Return Both you and your spouse must include all of your income, exemptions, and deductions on your joint return. Free turbo tax 2012 Accounting period. Free turbo tax 2012   Both of you must use the same accounting period, but you can use different accounting methods. Free turbo tax 2012 See Accounting Periods and Accounting Methods in chapter 1. Free turbo tax 2012 Joint responsibility. Free turbo tax 2012   Both of you may be held responsible, jointly and individually, for the tax and any interest or penalty due on your joint return. Free turbo tax 2012 This means that if one spouse does not pay the tax due, the other may have to. Free turbo tax 2012 Or, if one spouse does not report the correct tax, both spouses may be responsible for any additional taxes assessed by the IRS. Free turbo tax 2012 One spouse may be held responsible for all the tax due even if all the income was earned by the other spouse. Free turbo tax 2012 You may want to file separately if: You believe your spouse is not reporting all of his or her income, or You do not want to be responsible for any taxes due if your spouse does not have enough tax withheld or does not pay enough estimated tax. Free turbo tax 2012 Divorced taxpayer. Free turbo tax 2012   You may be held jointly and individually responsible for any tax, interest, and penalties due on a joint return filed before your divorce. Free turbo tax 2012 This responsibility may apply even if your divorce decree states that your former spouse will be responsible for any amounts due on previously filed joint returns. Free turbo tax 2012 Relief from joint responsibility. Free turbo tax 2012   In some cases, one spouse may be relieved of joint responsibility for tax, interest, and penalties on a joint return for items of the other spouse that were incorrectly reported on the joint return. Free turbo tax 2012 You can ask for relief no matter how small the liability. Free turbo tax 2012   There are three types of relief available. Free turbo tax 2012 Innocent spouse relief. Free turbo tax 2012 Separation of liability (available only to joint filers who are divorced, widowed, legally separated, or have not lived together for the 12 months ending on the date the election for this relief is filed). Free turbo tax 2012 Equitable relief. Free turbo tax 2012    You must file Form 8857, Request for Innocent Spouse Relief, to request relief from joint responsibility. Free turbo tax 2012 Publication 971, Innocent Spouse Relief, explains these kinds of relief and who may qualify for them. Free turbo tax 2012 Signing a joint return. Free turbo tax 2012   For a return to be considered a joint return, both spouses generally must sign the return. Free turbo tax 2012 Spouse died before signing. Free turbo tax 2012   If your spouse died before signing the return, the executor or administrator must sign the return for your spouse. Free turbo tax 2012 If neither you nor anyone else has yet been appointed as executor or administrator, you can sign the return for your spouse and enter “Filing as surviving spouse” in the area where you sign the return. Free turbo tax 2012 Spouse away from home. Free turbo tax 2012   If your spouse is away from home, you should prepare the return, sign it, and send it to your spouse to sign so that it can be filed on time. Free turbo tax 2012 Injury or disease prevents signing. Free turbo tax 2012   If your spouse cannot sign because of disease or injury and tells you to sign for him or her, you can sign your spouse's name in the proper space on the return followed by the words “By (your name), Husband (or Wife). Free turbo tax 2012 ” Be sure to also sign in the space provided for your signature. Free turbo tax 2012 Attach a dated statement, signed by you, to the return. Free turbo tax 2012 The statement should include the form number of the return you are filing, the tax year, and the reason your spouse cannot sign, and should state that your spouse has agreed to your signing for him or her. Free turbo tax 2012 Signing as guardian of spouse. Free turbo tax 2012   If you are the guardian of your spouse who is mentally incompetent, you can sign the return for your spouse as guardian. Free turbo tax 2012 Spouse in combat zone. Free turbo tax 2012   You can sign a joint return for your spouse if your spouse cannot sign because he or she is serving in a combat zone (such as the Persian Gulf Area, Serbia, Montenegro, Albania, or Afghanistan), even if you do not have a power of attorney or other statement. Free turbo tax 2012 Attach a signed statement to your return explaining that your spouse is serving in a combat zone. Free turbo tax 2012 For more information on special tax rules for persons who are serving in a combat zone, or who are in missing status as a result of serving in a combat zone, see Publication 3, Armed Forces' Tax Guide. Free turbo tax 2012 Other reasons spouse cannot sign. Free turbo tax 2012    If your spouse cannot sign the joint return for any other reason, you can sign for your spouse only if you are given a valid power of attorney (a legal document giving you permission to act for your spouse). Free turbo tax 2012 Attach the power of attorney (or a copy of it) to your tax return. Free turbo tax 2012 You can use Form 2848, Power of Attorney and Declaration of Representative. Free turbo tax 2012 Nonresident alien or dual-status alien. Free turbo tax 2012   Generally, a married couple cannot file a joint return if either one is a nonresident alien at any time during the tax year. Free turbo tax 2012 However, if one spouse was a nonresident alien or dual-status alien who was married to a U. Free turbo tax 2012 S. Free turbo tax 2012 citizen or resident alien at the end of the year, the spouses can choose to file a joint return. Free turbo tax 2012 If you do file a joint return, you and your spouse are both treated as U. Free turbo tax 2012 S. Free turbo tax 2012 residents for the entire tax year. Free turbo tax 2012 See chapter 1 of Publication 519. Free turbo tax 2012 Married Filing Separately You can choose married filing separately as your filing status if you are married. Free turbo tax 2012 This filing status may benefit you if you want to be responsible only for your own tax or if it results in less tax than filing a joint return. Free turbo tax 2012 If you and your spouse do not agree to file a joint return, you must use this filing status unless you qualify for head of household status, discussed later. Free turbo tax 2012 You may be able to choose head of household filing status if you are considered unmarried because you live apart from your spouse and meet certain tests (explained later, under Head of Household ). Free turbo tax 2012 This can apply to you even if you are not divorced or legally separated. Free turbo tax 2012 If you qualify to file as head of household, instead of as married filing separately, your tax may be lower, you may be able to claim the earned income credit and certain other credits, and your standard deduction will be higher. Free turbo tax 2012 The head of household filing status allows you to choose the standard deduction even if your spouse chooses to itemize deductions. Free turbo tax 2012 See Head of Household , later, for more information. Free turbo tax 2012 You will generally pay more combined tax on separate returns than you would on a joint return for the reasons listed under Special Rules, later. Free turbo tax 2012 However, unless you are required to file separately, you should figure your tax both ways (on a joint return and on separate returns). Free turbo tax 2012 This way you can make sure you are using the filing status that results in the lowest combined tax. Free turbo tax 2012 When figuring the combined tax of a married couple, you may want to consider state taxes as well as federal taxes. Free turbo tax 2012 How to file. Free turbo tax 2012   If you file a separate return, you generally report only your own income, exemptions, credits, and deductions. Free turbo tax 2012 You can claim an exemption for your spouse only if your spouse had no gross income, is not filing a return, and was not the dependent of another person. Free turbo tax 2012 You can file Form 1040. Free turbo tax 2012 If your taxable income is less than $100,000, you may be able to file Form 1040A. Free turbo tax 2012 Select this filing status by checking the box on line 3 of either form. Free turbo tax 2012 Enter your spouse's full name and SSN or ITIN in the spaces provided. Free turbo tax 2012 If your spouse does not have and is not required to have an SSN or ITIN, enter “NRA” in the space for your spouse's SSN. Free turbo tax 2012 Use the Married filing separately column of the Tax Table or Section C of the Tax Computation Worksheet to figure your tax. Free turbo tax 2012 Special Rules If you choose married filing separately as your filing status, the following special rules apply. Free turbo tax 2012 Because of these special rules, you usually pay more tax on a separate return than if you use another filing status you qualify for. Free turbo tax 2012   Your tax rate generally is higher than on a joint return. Free turbo tax 2012 Your exemption amount for figuring the alternative minimum tax is half that allowed on a joint return. Free turbo tax 2012 You cannot take the credit for child and dependent care expenses in most cases, and the amount you can exclude from income under an employer's dependent care assistance program is limited to $2,500 (instead of $5,000). Free turbo tax 2012 If you are legally separated or living apart from your spouse, you may be able to file a separate return and still take the credit. Free turbo tax 2012 For more information about these expenses, the credit, and the exclusion, see chapter 32. Free turbo tax 2012 You cannot take the earned income credit. Free turbo tax 2012 You cannot take the exclusion or credit for adoption expenses in most cases. Free turbo tax 2012 You cannot take the education credits (the American opportunity credit and lifetime learning credit), the deduction for student loan interest, or the tuition and fees deduction. Free turbo tax 2012 You cannot exclude any interest income from qualified U. Free turbo tax 2012 S. Free turbo tax 2012 savings bonds you used for higher education expenses. Free turbo tax 2012 If you lived with your spouse at any time during the tax year: You cannot claim the credit for the elderly or the disabled, and You must include in income a greater percentage (up to 85%) of any social security or equivalent railroad retirement benefits you received. Free turbo tax 2012 The following credits and deductions are reduced at income levels half those for a joint return: The child tax credit, The retirement savings contributions credit, The deduction for personal exemptions, and Itemized deductions. Free turbo tax 2012 Your capital loss deduction limit is $1,500 (instead of $3,000 on a joint return). Free turbo tax 2012 If your spouse itemizes deductions, you cannot claim the standard deduction. Free turbo tax 2012 If you can claim the standard deduction, your basic standard deduction is half the amount allowed on a joint return. Free turbo tax 2012 Adjusted gross income (AGI) limits. Free turbo tax 2012   If your AGI on a separate return is lower than it would have been on a joint return, you may be able to deduct a larger amount for certain deductions that are limited by AGI, such as medical expenses. Free turbo tax 2012 Individual retirement arrangements (IRAs). Free turbo tax 2012   You may not be able to deduct all or part of your contributions to a traditional IRA if you or your spouse were covered by an employee retirement plan at work during the year. Free turbo tax 2012 Your deduction is reduced or eliminated if your income is more than a certain amount. Free turbo tax 2012 This amount is much lower for married individuals who file separately and lived together at any time during the year. Free turbo tax 2012 For more information, see How Much Can You Deduct in chapter 17. Free turbo tax 2012 Rental activity losses. Free turbo tax 2012   If you actively participated in a passive rental real estate activity that produced a loss, you generally can deduct the loss from your nonpassive income, up to $25,000. Free turbo tax 2012 This is called a special allowance. Free turbo tax 2012 However, married persons filing separate returns who lived together at any time during the year cannot claim this special allowance. Free turbo tax 2012 Married persons filing separate returns who lived apart at all times during the year are each allowed a $12,500 maximum special allowance for losses from passive real estate activities. Free turbo tax 2012 See Limits on Rental Losses in chapter 9. Free turbo tax 2012 Community property states. Free turbo tax 2012   If you live in Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, or Wisconsin and file separately, your income may be considered separate income or community income for income tax purposes. Free turbo tax 2012 See Publication 555. Free turbo tax 2012 Joint Return After Separate Returns You can change your filing status from a separate return to a joint return by filing an amended return using Form 1040X. Free turbo tax 2012 You generally can change to a joint return any time within 3 years from the due date of the separate return or returns. Free turbo tax 2012 This does not include any extensions. Free turbo tax 2012 A separate return includes a return filed by you or your spouse claiming married filing separately, single, or head of household filing status. Free turbo tax 2012 Separate Returns After Joint Return Once you file a joint return, you cannot choose to file separate returns for that year after the due date of the return. Free turbo tax 2012 Exception. Free turbo tax 2012   A personal representative for a decedent can change from a joint return elected by the surviving spouse to a separate return for the decedent. Free turbo tax 2012 The personal representative has 1 year from the due date of the return (including extensions) to make the change. Free turbo tax 2012 See Publication 559, Survivors, Executors, and Administrators, for more information on filing a return for a decedent. Free turbo tax 2012 Head of Household You may be able to file as head of household if you meet all the following requirements. Free turbo tax 2012 You are unmarried or “considered unmarried” on the last day of the year. Free turbo tax 2012 See Marital Status , earlier, and Considered Unmarried , later. Free turbo tax 2012 You paid more than half the cost of keeping up a home for the year. Free turbo tax 2012 A qualifying person lived with you in the home for more than half the year (except for temporary absences, such as school). Free turbo tax 2012 However, if the qualifying person is your dependent parent, he or she does not have to live with you. Free turbo tax 2012 See Special rule for parent , later, under Qualifying Person. Free turbo tax 2012 If you qualify to file as head of household, your tax rate usually will be lower than the rates for single or married filing separately. Free turbo tax 2012 You will also receive a higher standard deduction than if you file as single or married filing separately. Free turbo tax 2012 Kidnapped child. Free turbo tax 2012   A child may qualify you to file as head of household even if the child has been kidnapped. Free turbo tax 2012 For more information, see Publication 501. Free turbo tax 2012 How to file. Free turbo tax 2012   If you file as head of household, you can use Form 1040. Free turbo tax 2012 If your taxable income is less than $100,000, you may be able to file Form 1040A. Free turbo tax 2012 Indicate your choice of this filing status by checking the box on line 4 of either form. Free turbo tax 2012 Use the Head of a household column of the Tax Table or Section D of the Tax Computation Worksheet to figure your tax. Free turbo tax 2012 Considered Unmarried To qualify for head of household status, you must be either unmarried or considered unmarried on the last day of the year. Free turbo tax 2012 You are considered unmarried on the last day of the tax year if you meet all the following tests. Free turbo tax 2012 You file a separate return (defined earlier under Joint Return After Separate Returns ). Free turbo tax 2012 You paid more than half the cost of keeping up your home for the tax year. Free turbo tax 2012 Your spouse did not live in your home during the last 6 months of the tax year. Free turbo tax 2012 Your spouse is considered to live in your home even if he or she is temporarily absent due to special circumstances. Free turbo tax 2012 See Temporary absences , under Qualifying Person, later. Free turbo tax 2012 Your home was the main home of your child, stepchild, or foster child for more than half the year. Free turbo tax 2012 (See Home of qualifying person , under Qualifying Person, later, for rules applying to a child's birth, death, or temporary absence during the year. Free turbo tax 2012 ) You must be able to claim an exemption for the child. Free turbo tax 2012 However, you meet this test if you cannot claim the exemption only because the noncustodial parent can claim the child using the rules described in Children of divorced or separated parents (or parents who live apart) under Qualifying Child in chapter 3, or in Support Test for Children of Divorced or Separated Parents (or Parents Who Live Apart) under Qualifying Relative in chapter 3. Free turbo tax 2012 The general rules for claiming an exemption for a dependent are explained under Exemptions for Dependents in chapter 3. Free turbo tax 2012 If you were considered married for part of the year and lived in a community property state (listed earlier under Married Filing Separately), special rules may apply in determining your income and expenses. Free turbo tax 2012 See Publication 555 for more information. Free turbo tax 2012 Nonresident alien spouse. Free turbo tax 2012   You are considered unmarried for head of household purposes if your spouse was a nonresident alien at any time during the year and you do not choose to treat your nonresident spouse as a resident alien. Free turbo tax 2012 However, your spouse is not a qualifying person for head of household purposes. Free turbo tax 2012 You must have another qualifying person and meet the other tests to be eligible to file as a head of household. Free turbo tax 2012 Choice to treat spouse as resident. Free turbo tax 2012   You are considered married if you choose to treat your spouse as a resident alien. Free turbo tax 2012 See Publication 519. Free turbo tax 2012 Keeping Up a Home To qualify for head of household status, you must pay more than half of the cost of keeping up a home for the year. Free turbo tax 2012 You can determine whether you paid more than half of the cost of keeping up a home by using Worksheet 2–1. Free turbo tax 2012 Worksheet 2-1. Free turbo tax 2012 Cost of Keeping Up a Home   Amount You Paid Total Cost Property taxes $ $ Mortgage interest expense     Rent     Utility charges     Repairs/maintenance     Property insurance     Food consumed on the premises     Other household expenses     Totals $ $ Minus total amount you paid   () Amount others paid   $ If the total amount you paid is more than the amount others paid, you meet the requirement of paying more than half the cost of keeping up the home. Free turbo tax 2012 Costs you include. Free turbo tax 2012   Include in the cost of keeping up a home expenses such as rent, mortgage interest, real estate taxes, insurance on the home, repairs, utilities, and food eaten in the home. Free turbo tax 2012   If you used payments you received under Temporary Assistance for Needy Families (TANF) or other public assistance programs to pay part of the cost of keeping up your home, you cannot count them as money you paid. Free turbo tax 2012 However, you must include them in the total cost of keeping up your home to figure if you paid over half the cost. Free turbo tax 2012 Costs you do not include. Free turbo tax 2012   Do not include the costs of clothing, education, medical treatment, vacations, life insurance, or transportation. Free turbo tax 2012 Also, do not include the rental value of a home you own or the value of your services or those of a member of your household. Free turbo tax 2012 Qualifying Person See Table 2-1 to see who is a qualifying person. Free turbo tax 2012 Any person not described in Table 2-1 is not a qualifying person. Free turbo tax 2012 Table 2-1. Free turbo tax 2012 Who Is a Qualifying Person Qualifying You To File as Head of Household?1 Caution. Free turbo tax 2012 See the text of this chapter for the other requirements you must meet to claim head of household filing status. Free turbo tax 2012 IF the person is your . Free turbo tax 2012 . Free turbo tax 2012 . Free turbo tax 2012   AND . Free turbo tax 2012 . Free turbo tax 2012 . Free turbo tax 2012   THEN that person is . Free turbo tax 2012 . Free turbo tax 2012 . Free turbo tax 2012 qualifying child (such as a son, daughter, or grandchild who lived with you more than half the year and meets certain other tests)2   he or she is single   a qualifying person, whether or not you can claim an exemption for the person. Free turbo tax 2012   he or she is married and you can claim an exemption for him or her   a qualifying person. Free turbo tax 2012   he or she is married and you cannot claim an exemption for him or her   not a qualifying person. Free turbo tax 2012 3 qualifying relative4 who is your father or mother   you can claim an exemption for him or her5   a qualifying person. Free turbo tax 2012 6   you cannot claim an exemption for him or her   not a qualifying person. Free turbo tax 2012 qualifying relative4 other than your father or mother (such as a grandparent, brother, or sister who meets certain tests)   he or she lived with you more than half the year, and he or she is related to you in one of the ways listed under Relatives who do not have to live with you in chapter 3 and you can claim an exemption for him or her5   a qualifying person. Free turbo tax 2012   he or she did not live with you more than half the year   not a qualifying person. Free turbo tax 2012   he or she is not related to you in one of the ways listed under Relatives who do not have to live with you in chapter 3 and is your qualifying relative only because he or she lived with you all year as a member of your household   not a qualifying person. Free turbo tax 2012   you cannot claim an exemption for him or her   not a qualifying person. Free turbo tax 2012 1A person cannot qualify more than one taxpayer to use the head of household filing status for the year. Free turbo tax 2012 2The term “qualifying child” is defined in chapter 3. Free turbo tax 2012 Note. Free turbo tax 2012 If you are a noncustodial parent, the term “qualifying child” for head of household filing status does not include a child who is your qualifying child for exemption purposes only because of the rules described under Children of divorced or separated parents (or parents who live apart) under Qualifying Child in chapter 3. Free turbo tax 2012 If you are the custodial parent and those rules apply, the child generally is your qualifying child for head of household filing status even though the child is not a qualifying child for whom you can claim an exemption. Free turbo tax 2012 3This person is a qualifying person if the only reason you cannot claim the exemption is that you can be claimed as a dependent on someone else's return. Free turbo tax 2012 4The term “ qualifying relative ” is defined in chapter 3. Free turbo tax 2012 5If you can claim an exemption for a person only because of a multiple support agreement, that person is not a qualifying person. Free turbo tax 2012 See Multiple Support Agreement in chapter 3. Free turbo tax 2012 6See Special rule for parent . Free turbo tax 2012 Example 1—child. Free turbo tax 2012 Your unmarried son lived with you all year and was 18 years old at the end of the year. Free turbo tax 2012 He did not provide more than half of his own support and does not meet the tests to be a qualifying child of anyone else. Free turbo tax 2012 As a result, he is your qualifying child (see Qualifying Child in chapter 3) and, because he is single, your qualifying person for you to claim head of household filing status. Free turbo tax 2012 Example 2—child who is not qualifying person. Free turbo tax 2012 The facts are the same as in Example 1 except your son was 25 years old at the end of the year and his gross income was $5,000. Free turbo tax 2012 Because he does not meet the age test (explained under Qualifying Child in chapter 3), your son is not your qualifying child. Free turbo tax 2012 Because he does not meet the gross income test (explained later under Qualifying Relative in chapter 3), he is not your qualifying relative. Free turbo tax 2012 As a result, he is not your qualifying person for head of household purposes. Free turbo tax 2012 Example 3—girlfriend. Free turbo tax 2012 Your girlfriend lived with you all year. Free turbo tax 2012 Even though she may be your qualifying relative if the gross income and support tests (explained in chapter 3) are met, she is not your qualifying person for head of household purposes because she is not related to you in one of the ways listed under Relatives who do not have to live with you in chapter 3. Free turbo tax 2012 See Table 2-1. Free turbo tax 2012 Example 4—girlfriend's child. Free turbo tax 2012 The facts are the same as in Example 3 except your girlfriend's 10-year-old son also lived with you all year. Free turbo tax 2012 He is not your qualifying child and, because he is your girlfriend's qualifying child, he is not your qualifying relative (see Not a Qualifying Child Test in chapter 3). Free turbo tax 2012 As a result, he is not your qualifying person for head of household purposes. Free turbo tax 2012 Home of qualifying person. Free turbo tax 2012   Generally, the qualifying person must live with you for more than half of the year. Free turbo tax 2012 Special rule for parent. Free turbo tax 2012   If your qualifying person is your father or mother, you may be eligible to file as head of household even if your father or mother does not live with you. Free turbo tax 2012 However, you must be able to claim an exemption for your father or mother. Free turbo tax 2012 Also, you must pay more than half the cost of keeping up a home that was the main home for the entire year for your father or mother. Free turbo tax 2012   You are keeping up a main home for your father or mother if you pay more than half the cost of keeping your parent in a rest home or home for the elderly. Free turbo tax 2012 Death or birth. Free turbo tax 2012   You may be eligible to file as head of household even if the individual who qualifies you for this filing status is born or dies during the year. Free turbo tax 2012 If the individual is your qualifying child, the child must have lived with you for more than half the part of the year he or she was alive. Free turbo tax 2012 If the individual is anyone else, see Publication 501. Free turbo tax 2012 Temporary absences. Free turbo tax 2012   You and your qualifying person are considered to live together even if one or both of you are temporarily absent from your home due to special circumstances such as illness, education, business, vacation, or military service. Free turbo tax 2012 It must be reasonable to assume the absent person will return to the home after the temporary absence. Free turbo tax 2012 You must continue to keep up the home during the absence. Free turbo tax 2012 Qualifying Widow(er) With Dependent Child If your spouse died in 2013, you can use married filing jointly as your filing status for 2013 if you otherwise qualify to use that status. Free turbo tax 2012 The year of death is the last year for which you can file jointly with your deceased spouse. Free turbo tax 2012 See Married Filing Jointly , earlier. Free turbo tax 2012 You may be eligible to use qualifying widow(er) with dependent child as your filing status for 2 years following the year your spouse died. Free turbo tax 2012 For example, if your spouse died in 2012, and you have not remarried, you may be able to use this filing status for 2013 and 2014. Free turbo tax 2012 This filing status entitles you to use joint return tax rates and the highest standard deduction amount (if you do not itemize deductions). Free turbo tax 2012 It does not entitle you to file a joint return. Free turbo tax 2012 How to file. Free turbo tax 2012   If you file as qualifying widow(er) with dependent child, you can use Form 1040. Free turbo tax 2012 If you also have taxable income of less than $100,000 and meet certain other conditions, you may be able to file Form 1040A. Free turbo tax 2012 Check the box on line 5 of either form. Free turbo tax 2012 Use the Married filing jointly column of the Tax Table or Section B of the Tax Computation Worksheet to figure your tax. Free turbo tax 2012 Eligibility rules. Free turbo tax 2012   You are eligible to file your 2013 return as a qualifying widow(er) with dependent child if you meet all of the following tests. Free turbo tax 2012 You were entitled to file a joint return with your spouse for the year your spouse died. Free turbo tax 2012 It does not matter whether you actually filed a joint return. Free turbo tax 2012 Your spouse died in 2011 or 2012 and you did not remarry before the end of 2013. Free turbo tax 2012 You have a child or stepchild for whom you can claim an exemption. Free turbo tax 2012 This does not include a foster child. Free turbo tax 2012 This child lived in your home all year, except for temporary absences. Free turbo tax 2012 See Temporary absences , earlier, under Head of Household. Free turbo tax 2012 There are also exceptions, described later, for a child who was born or died during the year and for a kidnapped child. Free turbo tax 2012 You paid more than half the cost of keeping up a home for the year. Free turbo tax 2012 See Keeping Up a Home , earlier, under Head of Household. Free turbo tax 2012 Example. Free turbo tax 2012 John's wife died in 2011. Free turbo tax 2012 John has not remarried. Free turbo tax 2012 During 2012 and 2013, he continued to keep up a home for himself and his child, who lives with him and for whom he can claim an exemption. Free turbo tax 2012 For 2011 he was entitled to file a joint return for himself and his deceased wife. Free turbo tax 2012 For 2012 and 2013, he can file as qualifying widower with a dependent child. Free turbo tax 2012 After 2013 he can file as head of household if he qualifies. Free turbo tax 2012 Death or birth. Free turbo tax 2012    You may be eligible to file as a qualifying widow(er) with dependent child if the child who qualifies you for this filing status is born or dies during the year. Free turbo tax 2012 You must have provided more than half of the cost of keeping up a home that was the child's main home during the entire part of the year he or she was alive. Free turbo tax 2012 Kidnapped child. Free turbo tax 2012   A child may qualify you for qualifying widow(er) with dependent child, even if the child has been kidnapped. Free turbo tax 2012 See Publication 501. Free turbo tax 2012    As mentioned earlier, this filing status is available for only 2 years following the year your spouse died. Free turbo tax 2012 Prev  Up  Next   Home   More Online Publications
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The Free Turbo Tax 2012

Free turbo tax 2012 3. Free turbo tax 2012   Abandonments Table of Contents You abandon property when you voluntarily and permanently give up possession and use of the property with the intention of ending your ownership but without passing it on to anyone else. Free turbo tax 2012 Whether an abandonment has occurred is determined in light of all the facts and circumstances. Free turbo tax 2012 You must both show an intention to abandon the property and affirmatively act to abandon the property. Free turbo tax 2012 A voluntary conveyance of the property in lieu of foreclosure is not an abandonment and is treated as the exchange of property to satisfy a debt. Free turbo tax 2012 For more information, see Sales and Exchanges in Publication 544. Free turbo tax 2012 The tax consequences of abandonment of property that secures a debt depend on whether you were personally liable for the debt (recourse debt) or were not personally liable for the debt (nonrecourse debt). Free turbo tax 2012 See Publication 544 if you abandoned property that did not secure debt. Free turbo tax 2012 This publication only discusses the tax consequences of abandoning property that secured a debt. Free turbo tax 2012 Abandonment of property securing recourse debt. Free turbo tax 2012    In most cases, if you abandon property that secures debt for which you are personally liable (recourse debt), you do not have gain or loss until the later foreclosure is completed. Free turbo tax 2012 For details on figuring gain or loss on the foreclosure, see chapter 2. Free turbo tax 2012 Example 1—abandonment of personal-use property securing recourse debt. Free turbo tax 2012 In 2009, Anne purchased a home for $200,000. Free turbo tax 2012 She borrowed the entire purchase price, for which she was personally liable, and gave the bank a mortgage on the home. Free turbo tax 2012 In 2013, Anne lost her job and was unable to continue making her mortgage loan payments. Free turbo tax 2012 Because her mortgage loan balance was $185,000 and the FMV of her home was only $150,000, Anne decided to abandon her home by permanently moving out on August 1, 2013. Free turbo tax 2012 Because Anne was personally liable for the debt and the bank did not complete a foreclosure of the property in 2013, Anne has neither gain nor loss in tax year 2013 from abandoning the home. Free turbo tax 2012 If the bank sells the house at a foreclosure sale in 2014, Anne will have to figure her gain or nondeductible loss for tax year 2014 as discussed earlier in chapter 2. Free turbo tax 2012 Example 2—abandonment of business or investment property securing recourse debt. Free turbo tax 2012 In 2009, Sue purchased business property for $200,000. Free turbo tax 2012 She borrowed the entire purchase price, for which she was personally liable, and gave the lender a security interest in the property. Free turbo tax 2012 In 2013, Sue was unable to continue making her loan payments. Free turbo tax 2012 Because her loan balance was $185,000 and the FMV of the property was only $150,000, Sue abandoned the property on August 1, 2013. Free turbo tax 2012 Because Sue was personally liable for the debt and the lender did not complete a foreclosure of the property in 2013, Sue has neither gain nor loss in tax year 2013 from abandoning the property. Free turbo tax 2012 If the lender sells the property at a foreclosure sale in 2014, Sue will have to figure her gain or deductible loss for tax year 2014 as discussed earlier in chapter 2. Free turbo tax 2012 Abandonment of property securing nonrecourse debt. Free turbo tax 2012    If you abandon property that secures debt for which you are not personally liable (nonrecourse debt), the abandonment is treated as a sale or exchange. Free turbo tax 2012   The amount you realize on the abandonment of property that secured nonrecourse debt is the amount of the nonrecourse debt. Free turbo tax 2012 If the amount you realize is more than your adjusted basis, then you have a gain. Free turbo tax 2012 If your adjusted basis is more than the amount you realize, then you have a loss. Free turbo tax 2012 For more information on how to figure gain and loss, see Gain or Loss from Sales or Exchanges in Publication 544. Free turbo tax 2012   Loss from abandonment of business or investment property is deductible as a loss. Free turbo tax 2012 The character of the loss depends on the character of the property. Free turbo tax 2012 The amount of deductible capital loss may be limited. Free turbo tax 2012 For more information, see Treatment of Capital Losses in Publication 544. Free turbo tax 2012 You cannot deduct any loss from abandonment of your home or other property held for personal use. Free turbo tax 2012 Example 1—abandonment of personal-use property securing nonrecourse debt. Free turbo tax 2012 In 2009, Timothy purchased a home for $200,000. Free turbo tax 2012 He borrowed the entire purchase price, for which he was not personally liable, and gave the bank a mortgage on the home. Free turbo tax 2012 In 2013, Timothy lost his job and was unable to continue making his mortgage loan payments. Free turbo tax 2012 Because his mortgage loan balance was $185,000 and the FMV of his home was only $150,000, Timothy decided to abandon his home by permanently moving out on August 1, 2013. Free turbo tax 2012 Because Timothy was not personally liable for the debt, the abandonment is treated as a sale or exchange of the home in tax year 2013. Free turbo tax 2012 Timothy's amount realized is $185,000 and his adjusted basis in the home is $200,000. Free turbo tax 2012 Timothy has a $15,000 nondeductible loss in tax year 2013. Free turbo tax 2012 (Had Timothy’s adjusted basis been less than the amount realized, Timothy would have had a gain that he would have to include in gross income. Free turbo tax 2012 ) The bank sells the house at a foreclosure sale in 2014. Free turbo tax 2012 Timothy has neither gain nor loss from the foreclosure sale. Free turbo tax 2012 Because he was not personally liable for the debt, he also has no cancellation of debt income. Free turbo tax 2012 Example 2—abandonment of business or investment property securing nonrecourse debt. Free turbo tax 2012 In 2009, Robert purchased business property for $200,000. Free turbo tax 2012 He borrowed the entire purchase price, for which he was not personally liable, and gave the lender a security interest in the property. Free turbo tax 2012 In 2013, Robert was unable to continue making his loan payments. Free turbo tax 2012 Because his loan balance was $185,000 and the FMV of the property was only $150,000, Robert decided to abandon the property on August 1, 2013. Free turbo tax 2012 Because Robert was not personally liable for the debt, the abandonment is treated as a sale or exchange of the property in tax year 2013. Free turbo tax 2012 Robert's amount realized is $185,000 and his adjusted basis in the property is $180,000 (as a result of $20,000 of depreciation deductions on the property). Free turbo tax 2012 Robert has a $5,000 gain in tax year 2013. Free turbo tax 2012 (Had Robert’s adjusted basis been greater than the amount realized, he would have had a deductible loss. Free turbo tax 2012 ) The lender sells the property at a foreclosure sale in 2014. Free turbo tax 2012 Robert has neither gain nor loss from the foreclosure sale. Free turbo tax 2012 Because he was not personally liable for the debt, he also has no cancellation of debt income. Free turbo tax 2012 Canceled debt. Free turbo tax 2012    If the abandoned property secures a debt for which you are personally liable and the debt is canceled, you will realize ordinary income equal to the canceled debt. Free turbo tax 2012 This income is separate from any amount realized from abandonment of the property. Free turbo tax 2012 You must report this income on your return unless one of the exceptions or exclusions described in chapter 1 applies. Free turbo tax 2012 See chapter 1 for more details. Free turbo tax 2012 Forms 1099-A and 1099-C. Free turbo tax 2012    In most cases, if you abandon real property (such as a home), intangible property, or tangible personal property held (wholly or partly) for use in a trade or business or for investment, that secures a loan and the lender knows the property has been abandoned, the lender should send you Form 1099-A showing information you need to figure your gain or loss from the abandonment. Free turbo tax 2012 Also, if your debt is canceled and the lender must file Form 1099-C, the lender can include the information about the abandonment on that form instead of on Form 1099-A. Free turbo tax 2012 The lender must file Form 1099-C and send you a copy if the amount of debt canceled is $600 or more and the lender is a financial institution, credit union, federal government agency, or any organization that has a significant trade or business of lending money. Free turbo tax 2012 For abandonments of property and debt cancellations occurring in 2013, these forms should be sent to you by January 31, 2014. Free turbo tax 2012 Prev  Up  Next   Home   More Online Publications