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H And R Block 1040ez

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H And R Block 1040ez

H and r block 1040ez Publication 939 - Main Content Table of Contents General Information Taxation of Periodic PaymentsInvestment in the Contract Expected Return Computation Under the General Rule How To Use Actuarial TablesUnisex Annuity Tables Special Elections Worksheets for Determining Taxable Annuity Actuarial Tables Requesting a Ruling on Taxation of Annuity How To Get Tax HelpLow Income Taxpayer Clinics General Information Some of the terms used in this publication are defined in the following paragraphs. H and r block 1040ez A pension is generally a series of payments made to you after you retire from work. H and r block 1040ez Pension payments are made regularly and are for past services with an employer. H and r block 1040ez An annuity is a series of payments under a contract. H and r block 1040ez You can buy the contract alone or you can buy it with the help of your employer. H and r block 1040ez Annuity payments are made regularly for more than one full year. H and r block 1040ez Note. H and r block 1040ez Distributions from pensions and annuities follow the same rules as outlined in this publication unless otherwise noted. H and r block 1040ez Types of pensions and annuities. H and r block 1040ez   Particular types of pensions and annuities include: Fixed period annuities. H and r block 1040ez You receive definite amounts at regular intervals for a definite length of time. H and r block 1040ez Annuities for a single life. H and r block 1040ez You receive definite amounts at regular intervals for life. H and r block 1040ez The payments end at death. H and r block 1040ez Joint and survivor annuities. H and r block 1040ez The first annuitant receives a definite amount at regular intervals for life. H and r block 1040ez After he or she dies, a second annuitant receives a definite amount at regular intervals for life. H and r block 1040ez The amount paid to the second annuitant may or may not differ from the amount paid to the first annuitant. H and r block 1040ez Variable annuities. H and r block 1040ez You receive payments that may vary in amount for a definite length of time or for life. H and r block 1040ez The amounts you receive may depend upon such variables as profits earned by the pension or annuity funds or cost-of-living indexes. H and r block 1040ez Disability pensions. H and r block 1040ez You are under minimum retirement age and receive payments because you retired on disability. H and r block 1040ez If, at the time of your retirement, you were permanently and totally disabled, you may be eligible for the credit for the elderly or the disabled discussed in Publication 524. H and r block 1040ez If your annuity starting date is after November 18, 1996, the General Rule cannot be used for the following qualified plans. H and r block 1040ez A qualified employee plan is an employer's stock bonus, pension, or profit-sharing plan that is for the exclusive benefit of employees or their beneficiaries. H and r block 1040ez This plan must meet Internal Revenue Code requirements. H and r block 1040ez It qualifies for special tax benefits, including tax deferral for employer contributions and rollover distributions. H and r block 1040ez However, you must use the General Rule if you were 75 or over and the annuity payments are guaranteed for more than 5 years. H and r block 1040ez A qualified employee annuity is a retirement annuity purchased by an employer for an employee under a plan that meets Internal Revenue Code requirements. H and r block 1040ez A tax-sheltered annuity is a special annuity plan or contract purchased for an employee of a public school or tax-exempt organization. H and r block 1040ez   The General Rule is used to figure the tax treatment of various types of pensions and annuities, including nonqualified employee plans. H and r block 1040ez A nonqualified employee plan is an employer's plan that does not meet Internal Revenue Code requirements. H and r block 1040ez It does not qualify for most of the tax benefits of a qualified plan. H and r block 1040ez Annuity worksheets. H and r block 1040ez   The worksheets found near the end of the text of this publication may be useful to you in figuring the taxable part of your annuity. H and r block 1040ez Request for a ruling. H and r block 1040ez   If you are unable to determine the income tax treatment of your pension or annuity, you may ask the Internal Revenue Service to figure the taxable part of your annuity payments. H and r block 1040ez This is treated as a request for a ruling. H and r block 1040ez See Requesting a Ruling on Taxation of Annuity near the end of this publication. H and r block 1040ez Withholding tax and estimated tax. H and r block 1040ez   Your pension or annuity is subject to federal income tax withholding unless you choose not to have tax withheld. H and r block 1040ez If you choose not to have tax withheld from your pension or annuity, or if you do not have enough income tax withheld, you may have to make estimated tax payments. H and r block 1040ez Taxation of Periodic Payments This section explains how the periodic payments you receive under a pension or annuity plan are taxed under the General Rule. H and r block 1040ez Periodic payments are amounts paid at regular intervals (such as weekly, monthly, or yearly) for a period of time greater than one year (such as for 15 years or for life). H and r block 1040ez These payments are also known as amounts received as an annuity. H and r block 1040ez If you receive an amount from your plan that is a nonperiodic payment (amount not received as an annuity), see Taxation of Nonperiodic Payments in Publication 575. H and r block 1040ez In general, you can recover your net cost of the pension or annuity tax free over the period you are to receive the payments. H and r block 1040ez The amount of each payment that is more than the part that represents your net cost is taxable. H and r block 1040ez Under the General Rule, the part of each annuity payment that represents your net cost is in the same proportion that your investment in the contract is to your expected return. H and r block 1040ez These terms are explained in the following discussions. H and r block 1040ez Investment in the Contract In figuring how much of your pension or annuity is taxable under the General Rule, you must figure your investment in the contract. H and r block 1040ez First, find your net cost of the contract as of the annuity starting date (defined later). H and r block 1040ez To find this amount, you must first figure the total premiums, contributions, or other amounts paid. H and r block 1040ez This includes the amounts your employer contributed if you were required to include these amounts in income. H and r block 1040ez It also includes amounts you actually contributed (except amounts for health and accident benefits and deductible voluntary employee contributions). H and r block 1040ez From this total cost you subtract: Any refunded premiums, rebates, dividends, or unrepaid loans (any of which were not included in your income) that you received by the later of the annuity starting date or the date on which you received your first payment. H and r block 1040ez Any additional premiums paid for double indemnity or disability benefits. H and r block 1040ez Any other tax-free amounts you received under the contract or plan before the later of the dates in (1). H and r block 1040ez The annuity starting date   is the later of the first day of the first period for which you receive payment under the contract or the date on which the obligation under the contract becomes fixed. H and r block 1040ez Example. H and r block 1040ez On January 1 you completed all your payments required under an annuity contract providing for monthly payments starting on August 1, for the period beginning July 1. H and r block 1040ez The annuity starting date is July 1. H and r block 1040ez This is the date you use in figuring your investment in the contract and your expected return (discussed later). H and r block 1040ez Adjustments If any of the following items apply, adjust (add or subtract) your total cost to find your net cost. H and r block 1040ez Foreign employment. H and r block 1040ez   If you worked abroad, your cost may include contributions by your employer to the retirement plan, but only if those contributions would be excludible from your gross income had they been paid directly to you as compensation. H and r block 1040ez The contributions that apply are: Contributions before 1963 by your employer, Contributions after 1962 by your employer if the contributions would be excludible from your gross income (without regard to the foreign earned income exclusion) had they been paid directly to you, or Contributions after 1996 by your employer on your behalf if you performed the services of a foreign missionary (a duly ordained, commissioned, or licensed minister of a church or a lay person) if the contributions would be excludible from your gross income had they been paid directly to you. H and r block 1040ez Foreign employment contributions while a nonresident alien. H and r block 1040ez   In determining your cost, special rules apply if you are a U. H and r block 1040ez S. H and r block 1040ez citizen or resident alien who received distributions from a plan to which contributions were made while you were a nonresident alien. H and r block 1040ez Your contributions and your employer's contributions are not included in your cost if the contributions: Were made based on compensation which was for services performed outside the United States which you were a nonresident alien, and Were not subject to income tax under the laws of the United States or any foreign country, but only if the contribution would have been subject to income tax if they had been paid as cash compensation when the services were performed. H and r block 1040ez Death benefit exclusion. H and r block 1040ez   If you are the beneficiary of a deceased employee (or former employee), who died before August 21, 1996, you may qualify for a death benefit exclusion of up to $5,000. H and r block 1040ez The beneficiary of a deceased employee who died after August 20, 1996, will not qualify for the death benefit exclusion. H and r block 1040ez How to adjust your total cost. H and r block 1040ez   If you are eligible, treat the amount of any allowable death benefit exclusion as additional cost paid by the employee. H and r block 1040ez Add it to the cost or unrecovered cost of the annuity at the annuity starting date. H and r block 1040ez See Example 3 under Computation Under General Rule for an illustration of the adjustment to the cost of the contract. H and r block 1040ez Net cost. H and r block 1040ez   Your total cost plus certain adjustments and minus other amounts already recovered before the annuity starting date is your net cost. H and r block 1040ez This is the unrecovered investment in the contract as of the annuity starting date. H and r block 1040ez If your annuity starting date is after 1986, this is the maximum amount that you may recover tax free under the contract. H and r block 1040ez Refund feature. H and r block 1040ez   Adjustment for the value of the refund feature is only applicable when you report your pension or annuity under the General Rule. H and r block 1040ez Your annuity contract has a refund feature if: The expected return ( discussed later) of an annuity depends entirely or partly on the life of one or more individuals, The contract provides that payments will be made to a beneficiary or the estate of an annuitant on or after the death of the annuitant if a stated amount or a stated number of payments has not been paid to the annuitant or annuitants before death, and The payments are a refund of the amount you paid for the annuity contract. H and r block 1040ez   If your annuity has a refund feature, you must reduce your net cost of the contract by the value of the refund feature (figured using Table III or VII at the end of this publication, also see How To Use Actuarial Tables , later) to find the investment in the contract. H and r block 1040ez Zero value of refund feature. H and r block 1040ez   For a joint and survivor annuity, the value of the refund feature is zero if: Both annuitants are age 74 or younger, The payments are guaranteed for less than 2½ years, and The survivor's annuity is at least 50% of the first annuitant's annuity. H and r block 1040ez   For a single-life annuity without survivor benefit, the value of the refund feature is zero if: The payments are guaranteed for less than 2½ years, and The annuitant is: Age 57 or younger (if using the new (unisex) annuity tables), Age 42 or younger (if male and using the old annuity tables), or Age 47 or younger (if female and using the old annuity tables). H and r block 1040ez   If you do not meet these requirements, you will have to figure the value of the refund feature, as explained in the following discussion. H and r block 1040ez Examples. H and r block 1040ez The first example shows how to figure the value of the refund feature when there is only one beneficiary. H and r block 1040ez Example 2 shows how to figure the value of the refund feature when the contract provides, in addition to a whole life annuity, one or more temporary life annuities for the lives of children. H and r block 1040ez In both examples, the taxpayer elects to use Tables V through VIII. H and r block 1040ez If you need the value of the refund feature for a joint and survivor annuity, write to the Internal Revenue Service as explained under Requesting a Ruling on Taxation of Annuity near the end of this publication. H and r block 1040ez Example 1. H and r block 1040ez At age 65, Barbara bought for $21,053 an annuity with a refund feature. H and r block 1040ez She will get $100 a month for life. H and r block 1040ez Barbara's contract provides that if she does not live long enough to recover the full $21,053, similar payments will be made to her surviving beneficiary until a total of $21,053 has been paid under the contract. H and r block 1040ez In this case, the contract cost and the total guaranteed return are the same ($21,053). H and r block 1040ez Barbara's investment in the contract is figured as follows: Net cost $21,053 Amount to be received annually $1,200   Number of years for which payment is guaranteed ($21,053 divided by $1,200) 17. H and r block 1040ez 54   Rounded to nearest whole number of years 18   Percentage from Actuarial Table VII for age 65 with 18 years of guaranteed payments 15%   Value of the refund feature (rounded to the nearest dollar)—15% of $21,053 3,158 Investment in the contract, adjusted for value of refund feature $17,895       If the total guaranteed return were less than the $21,053 net cost of the contract, Barbara would apply the appropriate percentage from the tables to the lesser amount. H and r block 1040ez For example, if the contract guaranteed the $100 monthly payments for 17 years to Barbara's estate or beneficiary if she were to die before receiving all the payments for that period, the total guaranteed return would be $20,400 ($100 × 12 × 17 years). H and r block 1040ez In this case, the value of the refund feature would be $2,856 (14% of $20,400) and Barbara's investment in the contract would be $18,197 ($21,053 minus $2,856) instead of $17,895. H and r block 1040ez Example 2. H and r block 1040ez John died while still employed. H and r block 1040ez His widow, Eleanor, age 48, receives $171 a month for the rest of her life. H and r block 1040ez John's son, Elmer, age 9, receives $50 a month until he reaches age 18. H and r block 1040ez John's contributions to the retirement fund totaled $7,559. H and r block 1040ez 45, with interest on those contributions of $1,602. H and r block 1040ez 53. H and r block 1040ez The guarantee or total refund feature of the contract is $9,161. H and r block 1040ez 98 ($7,559. H and r block 1040ez 45 plus $1,602. H and r block 1040ez 53). H and r block 1040ez The adjustment in the investment in the contract is figured as follows: A) Expected return:*       1) Widow's expected return:         Annual annuity ($171 × 12) $2,052       Multiplied by factor from Table V         (nearest age 48) 34. H and r block 1040ez 9 $71,614. H and r block 1040ez 80   2) Child's expected return:         Annual annuity ($50 × 12) $600       Multiplied by factor from         Table VIII (nearest age 9         for term of 9 years) 9. H and r block 1040ez 0 5,400. H and r block 1040ez 00   3) Total expected return   $77,014. H and r block 1040ez 80 B) Adjustment for refund feature:       1) Contributions (net cost) $7,559. H and r block 1040ez 45   2) Guaranteed amount (contributions of $7,559. H and r block 1040ez 45 plus interest of $1,602. H and r block 1040ez 53) $9,161. H and r block 1040ez 98   3) Minus: Expected return under child's (temporary life) annuity (A(2)) 5,400. H and r block 1040ez 00   4) Net guaranteed amount $3,761. H and r block 1040ez 98   5) Multiple from Table VII (nearest age 48 for 2 years duration (recovery of $3,761. H and r block 1040ez 98 at $171 a month to nearest whole year)) 0%   6) Adjustment required for value of refund feature rounded to the nearest whole dollar  (0% × $3,761. H and r block 1040ez 98, the smaller of B(3) or B(6)) 0 *Expected return is the total amount you and other eligible annuitants can expect to receive under the contract. H and r block 1040ez See the discussion of expected return, later in this publication. H and r block 1040ez Free IRS help. H and r block 1040ez   If you need to request assistance to figure the value of the refund feature, see Requesting a Ruling on Taxation of Annuity near the end of this publication. H and r block 1040ez Expected Return Your expected return is the total amount you and other eligible annuitants can expect to receive under the contract. H and r block 1040ez The following discussions explain how to figure the expected return with each type of annuity. H and r block 1040ez A person's age, for purposes of figuring the expected return, is the age at the birthday nearest to the annuity starting date. H and r block 1040ez Fixed period annuity. H and r block 1040ez   If you will get annuity payments for a fixed number of years, without regard to your life expectancy, you must figure your expected return based on that fixed number of years. H and r block 1040ez It is the total amount you will get beginning at the annuity starting date. H and r block 1040ez You will receive specific periodic payments for a definite period of time, such as a fixed number of months (but not less than 13). H and r block 1040ez To figure your expected return, multiply the fixed number of months for which payments are to be made by the amount of the payment specified for each period. H and r block 1040ez Single life annuity. H and r block 1040ez   If you are to get annuity payments for the rest of your life, find your expected return as follows. H and r block 1040ez You must multiply the amount of the annual payment by a multiple based on your life expectancy as of the annuity starting date. H and r block 1040ez These multiples are set out in actuarial Tables I and V near the end of this publication (see How To Use Actuarial Tables , later). H and r block 1040ez   You may need to adjust these multiples if the payments are made quarterly, semiannually, or annually. H and r block 1040ez See Adjustments to Tables I, II, V, VI, and VIA following Table I. H and r block 1040ez Example. H and r block 1040ez Henry bought an annuity contract that will give him an annuity of $500 a month for his life. H and r block 1040ez If at the annuity starting date Henry's nearest birthday is 66, the expected return is figured as follows: Annual payment ($500 × 12 months) $6,000 Multiple shown in Table V, age 66 × 19. H and r block 1040ez 2 Expected return $115,200 If the payments were to be made to Henry quarterly and the first payment was made one full month after the annuity starting date, Henry would adjust the 19. H and r block 1040ez 2 multiple by +. H and r block 1040ez 1. H and r block 1040ez His expected return would then be $115,800 ($6,000 × 19. H and r block 1040ez 3). H and r block 1040ez Annuity for shorter of life or specified period. H and r block 1040ez   With this type of annuity, you are to get annuity payments either for the rest of your life or until the end of a specified period, whichever period is shorter. H and r block 1040ez To figure your expected return, multiply the amount of your annual payment by a multiple in Table IV or VIII for temporary life annuities. H and r block 1040ez Find the proper multiple based on your sex (if using Table IV), your age at the annuity starting date, and the nearest whole number of years in the specified period. H and r block 1040ez Example. H and r block 1040ez Harriet purchased an annuity this year that will pay her $200 each month for five years or until she dies, whichever period is shorter. H and r block 1040ez She was age 65 at her birthday nearest the annuity starting date. H and r block 1040ez She figures the expected return as follows: Annual payment ($200 × 12 months) $2,400 Multiple shown in Table VIII, age 65, 5-year term × 4. H and r block 1040ez 9 Expected return $11,760 She uses Table VIII (not Table IV) because all her contributions were made after June 30, 1986. H and r block 1040ez See Special Elections, later. H and r block 1040ez Joint and survivor annuities. H and r block 1040ez   If you have an annuity that pays you a periodic income for life and after your death provides an identical lifetime periodic income to your spouse (or some other person), you figure the expected return based on your combined life expectancies. H and r block 1040ez To figure the expected return, multiply the annual payment by a multiple in Table II or VI based on your joint life expectancies. H and r block 1040ez If your payments are made quarterly, semiannually, or annually, you may need to adjust these multiples. H and r block 1040ez See Adjustments to Tables I, II, V, VI, and VIA following Table I near the end of this publication. H and r block 1040ez Example. H and r block 1040ez John bought a joint and survivor annuity providing payments of $500 a month for his life, and, after his death, $500 a month for the remainder of his wife's life. H and r block 1040ez At John's annuity starting date, his age at his nearest birthday is 70 and his wife's at her nearest birthday is 67. H and r block 1040ez The expected return is figured as follows: Annual payment ($500 × 12 months) $6,000 Multiple shown in Table VI, ages 67 and 70 × 22. H and r block 1040ez 0 Expected return $132,000 Different payments to survivor. H and r block 1040ez   If your contract provides that payments to a survivor annuitant will be different from the amount you receive, you must use a computation which accounts for both the joint lives of the annuitants and the life of the survivor. H and r block 1040ez Example 1. H and r block 1040ez Gerald bought a contract providing for payments to him of $500 a month for life and, after his death, payments to his wife, Mary, of $350 a month for life. H and r block 1040ez If, at the annuity starting date, Gerald's nearest birthday is 70 and Mary's is 67, the expected return under the contract is figured as follows: Combined multiple for Gerald and Mary, ages 70 and 67 (from Table VI)   22. H and r block 1040ez 0 Multiple for Gerald, age 70 (from Table V)   16. H and r block 1040ez 0 Difference: Multiple applicable to Mary   6. H and r block 1040ez 0 Gerald's annual payment ($500 × 12) $6,000   Gerald's multiple 16. H and r block 1040ez 0   Gerald's expected return   $96,000 Mary's annual payment ($350 × 12) $4,200   Mary's multiple 6. H and r block 1040ez 0   Mary's expected return   25,200 Total expected return under the contract   $121,200 Example 2. H and r block 1040ez Your husband died while still employed. H and r block 1040ez Under the terms of his employer's retirement plan, you are entitled to get an immediate annuity of $400 a month for the rest of your life or until you remarry. H and r block 1040ez Your daughters, Marie and Jean, are each entitled to immediate temporary life annuities of $150 a month until they reach age 18. H and r block 1040ez You were 50 years old at the annuity starting date. H and r block 1040ez Marie was 16 and Jean was 14. H and r block 1040ez Using the multiples shown in Tables V and VIII at the end of this publication, the total expected return on the annuity starting date is $169,680, figured as follows: Widow, age 50 (multiple from Table V—33. H and r block 1040ez 1 × $4,800 annual payment) $158,880 Marie, age 16 for 2 years duration (multiple from Table VIII—2. H and r block 1040ez 0 × $1,800 annual payment) 3,600 Jean, age 14 for 4 years duration (multiple from Table VIII—4. H and r block 1040ez 0 × $1,800 annual payment) 7,200 Total expected return $169,680 No computation of expected return is made based on your husband's age at the date of death because he died before the annuity starting date. H and r block 1040ez Computation Under the General Rule Note. H and r block 1040ez Variable annuities use a different computation for determining the exclusion amounts. H and r block 1040ez See Variable annuities later. H and r block 1040ez Under the General Rule, you figure the taxable part of your annuity by using the following steps: Step 1. H and r block 1040ez   Figure the amount of your investment in the contract, including any adjustments for the refund feature and the death benefit exclusion, if applicable. H and r block 1040ez See Death benefit exclusion , earlier. H and r block 1040ez Step 2. H and r block 1040ez   Figure your expected return. H and r block 1040ez Step 3. H and r block 1040ez   Divide Step 1 by Step 2 and round to three decimal places. H and r block 1040ez This will give you the exclusion percentage. H and r block 1040ez Step 4. H and r block 1040ez   Multiply the exclusion percentage by the first regular periodic payment. H and r block 1040ez The result is the tax-free part of each pension or annuity payment. H and r block 1040ez   The tax-free part remains the same even if the total payment increases due to variation in the annuity amount such as cost of living increases, or you outlive the life expectancy factor used. H and r block 1040ez However, if your annuity starting date is after 1986, the total amount of annuity income that is tax free over the years cannot exceed your net cost. H and r block 1040ez   Each annuitant applies the same exclusion percentage to his or her initial payment called for in the contract. H and r block 1040ez Step 5. H and r block 1040ez   Multiply the tax-free part of each payment (step 4) by the number of payments received during the year. H and r block 1040ez This will give you the tax-free part of the total payment for the year. H and r block 1040ez    In the first year of your annuity, your first payment or part of your first payment may be for a fraction of the payment period. H and r block 1040ez This fractional amount is multiplied by your exclusion percentage to get the tax-free part. H and r block 1040ez Step 6. H and r block 1040ez   Subtract the tax-free part from the total payment you received. H and r block 1040ez The rest is the taxable part of your pension or annuity. H and r block 1040ez Example 1. H and r block 1040ez You purchased an annuity with an investment in the contract of $10,800. H and r block 1040ez Under its terms, the annuity will pay you $100 a month for life. H and r block 1040ez The multiple for your age (age 65) is 20. H and r block 1040ez 0 as shown in Table V. H and r block 1040ez Your expected return is $24,000 (20 × 12 × $100). H and r block 1040ez Your cost of $10,800, divided by your expected return of $24,000, equals 45. H and r block 1040ez 0%. H and r block 1040ez This is the percentage you will not have to include in income. H and r block 1040ez Each year, until your net cost is recovered, $540 (45% of $1,200) will be tax free and you will include $660 ($1,200 − $540) in your income. H and r block 1040ez If you had received only six payments of $100 ($600) during the year, your exclusion would have been $270 (45% of $100 × 6 payments). H and r block 1040ez Example 2. H and r block 1040ez Gerald bought a joint and survivor annuity. H and r block 1040ez Gerald's investment in the contract is $62,712 and the expected return is $121,200. H and r block 1040ez The exclusion percentage is 51. H and r block 1040ez 7% ($62,712 ÷ $121,200). H and r block 1040ez Gerald will receive $500 a month ($6,000 a year). H and r block 1040ez Each year, until his net cost is recovered, $3,102 (51. H and r block 1040ez 7% of his total payments received of $6,000) will be tax free and $2,898 ($6,000 − $3,102) will be included in his income. H and r block 1040ez If Gerald dies, his wife will receive $350 a month ($4,200 a year). H and r block 1040ez If Gerald had not recovered all of his net cost before his death, his wife will use the same exclusion percentage (51. H and r block 1040ez 7%). H and r block 1040ez Each year, until the entire net cost is recovered, his wife will receive $2,171. H and r block 1040ez 40 (51. H and r block 1040ez 7% of her payments received of $4,200) tax free. H and r block 1040ez She will include $2,028. H and r block 1040ez 60 ($4,200 − $2,171. H and r block 1040ez 40) in her income tax return. H and r block 1040ez Example 3. H and r block 1040ez Using the same facts as Example 2 under Different payments to survivor, you are to receive an annual annuity of $4,800 until you die or remarry. H and r block 1040ez Your two daughters each receive annual annuities of $1,800 until they reach age 18. H and r block 1040ez Your husband contributed $25,576 to the plan. H and r block 1040ez You are eligible for the $5,000 death benefit exclusion because your husband died before August 21, 1996. H and r block 1040ez Adjusted Investment in the Contract Contributions $25,576 Plus: Death benefit exclusion 5,000 Adjusted investment in the contract $30,576 The total expected return, as previously figured (in Example 2 under Different payments to survivor), is $169,680. H and r block 1040ez The exclusion percentage of 18. H and r block 1040ez 0% ($30,576 ÷ $169,680) applies to the annuity payments you and each of your daughters receive. H and r block 1040ez Each full year $864 (18. H and r block 1040ez 0% × $4,800) will be tax free to you, and you must include $3,936 in your income tax return. H and r block 1040ez Each year, until age 18, $324 (18. H and r block 1040ez 0% × $1,800) of each of your daughters' payments will be tax free and each must include the balance, $1,476, as income on her own income tax return. H and r block 1040ez Part-year payments. H and r block 1040ez   If you receive payments for only part of a year, apply the exclusion percentage to the first regular periodic payment, and multiply the result by the number of payments received during the year. H and r block 1040ez   If you receive amounts during the year that represent 12 payments, one for each month in that year, and an amount that represents payments for months in a prior year, apply the exclusion percentage to the first regular periodic payment, and multiply the result by the number of payments the amounts received represent. H and r block 1040ez For instance, if you received amounts during the year that represent the 12 payments for that year plus an amount that represents three payments for a prior year, multiply that amount by the 15 (12 + 3) payments received that the year. H and r block 1040ez   If you received a fractional payment, follow Step 5, discussed earlier. H and r block 1040ez This gives you the tax-free part of your total payment. H and r block 1040ez Example. H and r block 1040ez On September 28, Mary bought an annuity contract for $22,050 that will give her $125 a month for life, beginning October 30. H and r block 1040ez The applicable multiple from Table V is 23. H and r block 1040ez 3 (age 61). H and r block 1040ez Her expected return is $34,950 ($125 × 12 × 23. H and r block 1040ez 3). H and r block 1040ez Mary's investment in the contract of $22,050, divided by her expected return of $34,950, equals 63. H and r block 1040ez 1%. H and r block 1040ez Each payment received will consist of 63. H and r block 1040ez 1% return of cost and 36. H and r block 1040ez 9% taxable income, until her net cost of the contract is fully recovered. H and r block 1040ez During the first year, Mary received three payments of $125, or $375, of which $236. H and r block 1040ez 63 (63. H and r block 1040ez 1% × $375) is a return of cost. H and r block 1040ez The remaining $138. H and r block 1040ez 37 is included in income. H and r block 1040ez Increase in annuity payments. H and r block 1040ez   The tax-free amount remains the same as the amount figured at the annuity starting date, even if the payment increases. H and r block 1040ez All increases in the installment payments are fully taxable. H and r block 1040ez   However, if your annuity payments are scheduled to increase at a definite date in the future you must figure the expected return for that annuity using the method described in section 1. H and r block 1040ez 72-5(a)(5) of the regulations. H and r block 1040ez Example. H and r block 1040ez Joe's wife died while she was still employed and, as her beneficiary, he began receiving an annuity of $147 per month. H and r block 1040ez In figuring the taxable part, Joe elects to use Tables V through VIII. H and r block 1040ez The cost of the contract was $7,938, consisting of the sum of his wife's net contributions, adjusted for any refund feature. H and r block 1040ez His expected return as of the annuity starting date is $35,280 (age 65, multiple of 20. H and r block 1040ez 0 × $1,764 annual payment). H and r block 1040ez The exclusion percentage is $7,938 ÷ $35,280, or 22. H and r block 1040ez 5%. H and r block 1040ez During the year he received 11 monthly payments of $147, or $1,617. H and r block 1040ez Of this amount, 22. H and r block 1040ez 5% × $147 × 11 ($363. H and r block 1040ez 83) is tax free as a return of cost and the balance of $1,253. H and r block 1040ez 17 is taxable. H and r block 1040ez Later, because of a cost-of-living increase, his annuity payment was increased to $166 per month, or $1,992 a year (12 × $166). H and r block 1040ez The tax-free part is still only 22. H and r block 1040ez 5% of the annuity payments as of the annuity starting date (22. H and r block 1040ez 5% × $147 × 12 = $396. H and r block 1040ez 90 for a full year). H and r block 1040ez The increase of $228 ($1,992 − $1,764 (12 × $147)) is fully taxable. H and r block 1040ez Variable annuities. H and r block 1040ez   For variable annuity payments, figure the amount of each payment that is tax free by dividing your investment in the contract (adjusted for any refund feature) by the total number of periodic payments you expect to get under the contract. H and r block 1040ez   If the annuity is for a definite period, you determine the total number of payments by multiplying the number of payments to be made each year by the number of years you will receive payments. H and r block 1040ez If the annuity is for life, you determine the total number of payments by using a multiple from the appropriate actuarial table. H and r block 1040ez Example. H and r block 1040ez Frank purchased a variable annuity at age 65. H and r block 1040ez The total cost of the contract was $12,000. H and r block 1040ez The annuity starting date is January 1 of the year of purchase. H and r block 1040ez His annuity will be paid, starting July 1, in variable annual installments for his life. H and r block 1040ez The tax-free amount of each payment, until he has recovered his cost of his contract, is: Investment in the contract $12,000 Number of expected annual payments (multiple for age 65 from Table V) 20 Tax-free amount of each payment ($12,000 ÷ 20) $600 If Frank's first payment is $920, he includes only $320 ($920 − $600) in his gross income. H and r block 1040ez   If the tax-free amount for a year is more than the payments you receive in that year, you may choose, when you receive the next payment, to refigure the tax-free part. H and r block 1040ez Divide the amount of the periodic tax-free part that is more than the payment you received by the remaining number of payments you expect. H and r block 1040ez The result is added to the previously figured periodic tax-free part. H and r block 1040ez The sum is the amount of each future payment that will be tax free. H and r block 1040ez Example. H and r block 1040ez Using the facts of the previous example about Frank, assume that after Frank's $920 payment, he received $500 in the following year, and $1,200 in the year after that. H and r block 1040ez Frank does not pay tax on the $500 (second year) payment because $600 of each annual pension payment is tax free. H and r block 1040ez Since the $500 payment is less than the $600 annual tax-free amount, he may choose to refigure his tax-free part when he receives his $1,200 (third year) payment, as follows: Amount tax free in second year $600. H and r block 1040ez 00 Amount received in second year 500. H and r block 1040ez 00 Difference $100. H and r block 1040ez 00 Number of remaining payments after the first 2 payments (age 67, from Table V) 18. H and r block 1040ez 4 Amount to be added to previously determined annual tax-free part ($100 ÷ 18. H and r block 1040ez 4) $5. H and r block 1040ez 43 Revised annual tax-free part for third and later years ($600 + $5. H and r block 1040ez 43) $605. H and r block 1040ez 43 Amount taxable in third year ($1,200 − $605. H and r block 1040ez 43) $594. H and r block 1040ez 57 If you choose to refigure your tax-free amount,   you must file a statement with your income tax return stating that you are refiguring the tax-free amount in accordance with the rules of section 1. H and r block 1040ez 72–4(d)(3) of the Income Tax Regulations. H and r block 1040ez The statement must also show the following information: The annuity starting date and your age on that date. H and r block 1040ez The first day of the first period for which you received an annuity payment in the current year. H and r block 1040ez Your investment in the contract as originally figured. H and r block 1040ez The total of all amounts received tax free under the annuity from the annuity starting date through the first day of the first period for which you received an annuity payment in the current tax year. H and r block 1040ez Exclusion Limits Your annuity starting date determines the total amount of annuity income that you can exclude from income over the years. H and r block 1040ez Exclusion limited to net cost. H and r block 1040ez   If your annuity starting date is after 1986, the total amount of annuity income that you can exclude over the years as a return of your cost cannot exceed your net cost (figured without any reduction for a refund feature). H and r block 1040ez This is the unrecovered investment in the contract as of the annuity starting date. H and r block 1040ez   If your annuity starting date is after July 1, 1986, any unrecovered net cost at your (or last annuitant's) death is allowed as a miscellaneous itemized deduction on the final return of the decedent. H and r block 1040ez This deduction is not subject to the 2%-of-adjusted-gross-income limit. H and r block 1040ez Example 1. H and r block 1040ez Your annuity starting date is after 1986. H and r block 1040ez Your total cost is $12,500, and your net cost is $10,000, taking into account certain adjustments. H and r block 1040ez There is no refund feature. H and r block 1040ez Your monthly annuity payment is $833. H and r block 1040ez 33. H and r block 1040ez Your exclusion ratio is 12% and you exclude $100 a month. H and r block 1040ez Your exclusion ends after 100 months, when you have excluded your net cost of $10,000. H and r block 1040ez Thereafter, your annuity payments are fully taxable. H and r block 1040ez Example 2. H and r block 1040ez The facts are the same as in Example 1, except that there is a refund feature, and you die after 5 years with no surviving annuitant. H and r block 1040ez The adjustment for the refund feature is $1,000, so the investment in the contract is $9,000. H and r block 1040ez The exclusion ratio is 10. H and r block 1040ez 8%, and your monthly exclusion is $90. H and r block 1040ez After 5 years (60 months), you have recovered tax free only $5,400 ($90 x 60). H and r block 1040ez An itemized deduction for the unrecovered net cost of $4,600 ($10,000 net cost minus $5,400) may be taken on your final income tax return. H and r block 1040ez Your unrecovered investment is determined without regard to the refund feature adjustment, discussed earlier, under Adjustments. H and r block 1040ez Exclusion not limited to net cost. H and r block 1040ez   If your annuity starting date was before 1987, you could continue to take your monthly exclusion for as long as you receive your annuity. H and r block 1040ez If you choose a joint and survivor annuity, your survivor continues to take the survivor's exclusion figured as of the annuity starting date. H and r block 1040ez The total exclusion may be more than your investment in the contract. H and r block 1040ez How To Use Actuarial Tables In figuring, under the General Rule, the taxable part of your annuity payments that you are to get for the rest of your life (rather than for a fixed number of years), you must use one or more of the actuarial tables in this publication. H and r block 1040ez Unisex Annuity Tables Effective July 1, 1986, the Internal Revenue Service adopted new annuity Tables V through VIII, in which your sex is not considered when determining the applicable factor. H and r block 1040ez These tables correspond to the old Tables I through IV. H and r block 1040ez In general, Tables V through VIII must be used if you made contributions to the retirement plan after June 30, 1986. H and r block 1040ez If you made no contributions to the plan after June 30, 1986, generally you must use only Tables I through IV. H and r block 1040ez However, if you received an annuity payment after June 30, 1986, you may elect to use Tables V through VIII (see Annuity received after June 30, 1986, later). H and r block 1040ez Special Elections Although you generally must use Tables V through VIII if you made contributions to the retirement plan after June 30, 1986, and Tables I through IV if you made no contributions after June 30, 1986, you can make the following special elections to select which tables to use. H and r block 1040ez Contributions made both before July 1986 and after June 1986. H and r block 1040ez   If you made contributions to the retirement plan both before July 1986 and after June 1986, you may elect to use Tables I through IV for the pre-July 1986 cost of the contract, and Tables V through VIII for the post-June 1986 cost. H and r block 1040ez (See the examples below. H and r block 1040ez )    Making the election. H and r block 1040ez Attach this statement to your income tax return for the first year in which you receive an annuity:    “I elect to apply the provisions of paragraph (d) of section 1. H and r block 1040ez 72–6 of the Income Tax Regulations. H and r block 1040ez ”   The statement must also include your name, address, social security number, and the amount of the pre-July 1986 investment in the contract. H and r block 1040ez   If your investment in the contract includes post-June 1986 contributions to the plan, and you do not make the election to use Tables I through IV and Tables V through VIII, then you can only use Tables V through VIII in figuring the taxable part of your annuity. H and r block 1040ez You must also use Tables V through VIII if you are unable or do not wish to determine the portions of your contributions which were made before July 1, 1986, and after June 30, 1986. H and r block 1040ez    Advantages of election. H and r block 1040ez In general, a lesser amount of each annual annuity payment is taxable if you separately figure your exclusion ratio for pre-July 1986 and post-June 1986 contributions. H and r block 1040ez    If you intend to make this election, save your records that substantiate your pre-July 1986 and post-June 1986 contributions. H and r block 1040ez If the death benefit exclusion applies (see discussion, earlier), you do not have to apportion it between the pre-July 1986 and the post-June 1986 investment in the contract. H and r block 1040ez   The following examples illustrate the separate computations required if you elect to use Tables I through IV for your pre-July 1986 investment in the contract and Tables V through VIII for your post-June 1986 investment in the contract. H and r block 1040ez Example 1. H and r block 1040ez Bill, who is single, contributed $42,000 to the retirement plan and will receive an annual annuity of $24,000 for life. H and r block 1040ez Payment of the $42,000 contribution is guaranteed under a refund feature. H and r block 1040ez Bill is 55 years old as of the annuity starting date. H and r block 1040ez For figuring the taxable part of Bill's annuity, he chose to make separate computations for his pre-July 1986 investment in the contract of $41,300, and for his post-June 1986 investment in the contract of $700. H and r block 1040ez       Pre- July 1986   Post- June 1986 A. H and r block 1040ez Adjustment for refund feature         1) Net cost $41,300   $700   2) Annual annuity—$24,000  ($41,300/$42,000 × $24,000) $23,600       ($700/$42,000 × $24,000)     $400   3) Guarantee under contract $41,300   $700   4) No. H and r block 1040ez of years payments  guaranteed (rounded), A(3) ÷ A(2) 2   2   5) Applicable percentage from  Tables III and VII 1%   0%   6) Adjustment for value of refund  feature, A(5) × smaller of A(1)  or A(3) $413   $0 B. H and r block 1040ez Investment in the contract         1) Net cost $41,300   $700   2) Minus: Amount in A(6) 413   0   3) Investment in the contract $40,887   $700 C. H and r block 1040ez Expected return         1) Annual annuity receivable $24,000   $24,000   2) Multiples from Tables I and V 21. H and r block 1040ez 7   28. H and r block 1040ez 6   3) Expected return, C(1) × C(2) $520,800   $686,400 D. H and r block 1040ez Tax-free part of annuity         1) Exclusion ratio as decimal,  B(3) ÷ C(3) . H and r block 1040ez 079   . H and r block 1040ez 001   2) Tax-free part, C(1) × D(1) $1,896   $24 The tax-free part of Bill's total annuity is $1,920 ($1,896 plus $24). H and r block 1040ez The taxable part of his annuity is $22,080 ($24,000 minus $1,920). H and r block 1040ez If the annuity starting date is after 1986, the exclusion over the years cannot exceed the net cost (figured without any reduction for a refund feature). H and r block 1040ez Example 2. H and r block 1040ez Al is age 62 at his nearest birthday to the annuity starting date. H and r block 1040ez Al's wife is age 60 at her nearest birthday to the annuity starting date. H and r block 1040ez The joint and survivor annuity pays $1,000 per month to Al for life, and $500 per month to Al's surviving wife after his death. H and r block 1040ez The pre-July 1986 investment in the contract is $53,100 and the post-June 1986 investment in the contract is $7,000. H and r block 1040ez Al makes the election described in Example 1 . H and r block 1040ez For purposes of this example, assume the refund feature adjustment is zero. H and r block 1040ez If an adjustment is required, IRS will figure the amount. H and r block 1040ez See Requesting a Ruling on Taxation of Annuity near the end of this publication. H and r block 1040ez       Pre-  July 1986   Post-  June 1986 A. H and r block 1040ez Adjustment for refund feature         1) Net cost $53,100   $7,000   2) Annual annuity—$12,000  ($53,100/$60,100 × $12,000) $10,602       ($7,000/$60,100 × $12,000)     $1,398   3) Guaranteed under the contract $53,100   $7,000   4) Number of years guaranteed,  rounded, A(3) ÷ A(2) 5   5   5) Applicable percentages 0%   0%   6) Refund feature adjustment, A(5) × smaller of A(1) or A(3) 0   0 B. H and r block 1040ez Investment in the contract         1) Net cost $53,100   $7,000   2) Refund feature adjustment 0   0   3) Investment in the contract adjusted for refund feature $53,100   $7,000 C. H and r block 1040ez Expected return         1) Multiple for both annuitants from Tables II and VI 25. H and r block 1040ez 4   28. H and r block 1040ez 8   2) Multiple for first annuitant from Tables I and V 16. H and r block 1040ez 9   22. H and r block 1040ez 5   3) Multiple applicable to surviving annuitant, subtract C(2) from C(1) 8. H and r block 1040ez 5   6. H and r block 1040ez 3   4) Annual annuity to surviving annuitant $6,000   $6,000   5) Portion of expected return for surviving annuitant, C(4) × C(3) $51,000   $37,800   6) Annual annuity to first annuitant $12,000   $12,000   7) Plus: Portion of expected return for first annuitant, C(6) × C(2) $202,800   $270,000   8) Expected return for both annuitants, C(5) + C(7) $253,800   $307,800 D. H and r block 1040ez Tax-free part of annuity         1) Exclusion ratio as a decimal, B(3) ÷ C(8) . H and r block 1040ez 209   . H and r block 1040ez 023   2) Retiree's tax-free part of annuity, C(6) × D(1) $2,508   $276   3) Survivor's tax-free part of annuity, C(4) × D(1) $1,254   $138 The tax-free part of Al's total annuity is $2,784 ($2,508 + $276). H and r block 1040ez The taxable part of his annuity is $9,216 ($12,000 − $2,784). H and r block 1040ez The exclusion over the years cannot exceed the net cost of the contract (figured without any reduction for a refund feature) if the annuity starting date is after 1986. H and r block 1040ez After Al's death, his widow will apply the same exclusion percentages (20. H and r block 1040ez 9% and 2. H and r block 1040ez 3%) to her annual annuity of $6,000 to figure the tax-free part of her annuity. H and r block 1040ez Annuity received after June 30, 1986. H and r block 1040ez   If you receive an annuity payment after June 30, 1986, (regardless of your annuity starting date), you may elect to treat the entire cost of the contract as post-June 1986 cost (even if you made no post-June 1986 contributions to the plan) and use Tables V through VIII. H and r block 1040ez Once made, you cannot revoke the election, which will apply to all payments during the year and in any later year. H and r block 1040ez    Make the election by attaching the following statement to your income tax return. H and r block 1040ez    “I elect, under section 1. H and r block 1040ez 72–9 of the Income Tax Regulations, to treat my entire cost of the contract as a post-June 1986 cost of the plan. H and r block 1040ez ”   The statement must also include your name, address, and social security number. H and r block 1040ez   You should also indicate you are making this election if you are unable or do not wish to determine the parts of your contributions which were made before July 1, 1986, and after June 30, 1986. H and r block 1040ez Disqualifying form of payment or settlement. H and r block 1040ez   If your annuity starting date is after June 30, 1986, and the contract provides for a disqualifying form of payment or settlement, such as an option to receive a lump sum in full discharge of the obligation under the contract, the entire investment in the contract is treated as post-June 1986 investment in the contract. H and r block 1040ez See regulations section 1. H and r block 1040ez 72–6(d)(3) for additional examples of disqualifying forms of payment or settlement. H and r block 1040ez You can find the Income Tax Regulations in many libraries and at Internal Revenue Service Offices. H and r block 1040ez Worksheets for Determining Taxable Annuity Worksheets I and II. H and r block 1040ez   Worksheets I and II follow for determining your taxable annuity under Regulations Section 1. H and r block 1040ez 72–6(d)(6) Election. H and r block 1040ez Worksheet I For Determining Taxable Annuity Under Regulations Section 1. H and r block 1040ez 72-6(d)(6) Election For Single Annuitant With No Survivor Annuity               Pre-July 1986   Post-June 1986 A. H and r block 1040ez   Refund Feature Adjustment             1)   Net cost (total cost less returned premiums, dividends, etc. H and r block 1040ez )             2)   Annual annuity allocation:                   Portion of net cost in A(1) x annual annuity                   Net cost             3)   Guaranteed under the contract             4)   Number of years guaranteed, rounded to whole years:                   A(3) divided by A(2)             5)   Applicable percentages* from Tables III and VII                   *If your annuity meets the three conditions listed in Zero value of refund feature in Investment in the Contract, earlier, both percentages are 0. H and r block 1040ez If not, the IRS will calculate the refund feature percentage. H and r block 1040ez             6)   Refund feature adjustment:                   A(5) times lesser of A(1) or A(3)                             B. H and r block 1040ez   Investment in the Contract             1)   Net cost:                   A(1)             2)   Refund feature adjustment:                   A(6)             3)   Investment in the contract adjusted for refund feature:                   B(1) minus B(2)                             C. H and r block 1040ez   Expected Return             1)   Annual Annuity:                   12 times monthly annuity**             2)   Expected return multiples from Tables I and V             3)     Expected return:                   C(1) times C(2)                             D. H and r block 1040ez   Tax-Free Part of Annuity             1)     Exclusion ratio, as a decimal rounded to 3 places:                   B(3) divided by C(3)             2)     Tax-free part of annuity:                   C(1) times D(1)             **If the annuity is not paid monthly, figure the amount to enter by using the total number of periodic payments for the year times the amount of the periodic payment. H and r block 1040ez     Worksheet II For Determining Taxable Annuity Under Regulations Section 1. H and r block 1040ez 72-6(d)(6) Election For Joint and Survivor Annuity               Pre-July 1986   Post-June 1986 A. H and r block 1040ez   Refund Feature Adjustment             1)   Net cost (total cost less returned premiums, dividends, etc. H and r block 1040ez )             2)   Annual annuity allocation:                   Portion of net cost in A(1) x annual annuity                   Net cost             3)   Guaranteed under the contract             4)     Number of years guaranteed, rounded to whole years:                   A(3) divided by A(2)             5)   Applicable percentages*                   *If your annuity meets the three conditions listed in Zero value of refund feature in Investment in the Contract, earlier, both percentages are 0. H and r block 1040ez If not, the IRS will calculate the refund feature percentage. H and r block 1040ez             6)   Refund feature adjustment:                   A(5) times lesser of A(1) or A(3)                             B. H and r block 1040ez   Investment in the Contract             1)   Net cost:                   A(1)             2)   Refund feature adjustment:                   A(6)             3)   Investment in the contract adjusted for refund future:                   B(1) minus B(2)                             C. H and r block 1040ez   Expected Return             1)   Multiples for both annuitants, Tables II and VI             2)   Multiple for retiree. H and r block 1040ez Tables I and VI             3)   Multiple for survivor:                   C(1) minus C(2)             4)   Annual annuity to survivor:                   12 times potential monthly rate for survivor**             5)   Expected return for survivor:                   C(3) times C(4)             6)   Annual annuity to retiree:                   12 times monthly rate for retiree**             7)   Expected return for retiree:                   C(2) times C(6)             8)   Total expected return:                   C(5) plus C(7)                             D. H and r block 1040ez   Tax-Free Part of Annuity             1)   Exclusion ratio, as a decimal rounded to 3 places:                   B(3) divided by C(8)             2)   Retiree's tax-free part of annuity:                   C(6) times D(1)             3)   Survivor's tax-free part of annuity, if surviving after death of retiree:                   C(4) times D(1)             **If the annuity is not paid monthly, figure the amount to enter by using the total number of periodic payments for the year times the amount of the periodic payment. H and r block 1040ez   Actuarial Tables Please click here for the text description of the image. H and r block 1040ez Actuarial Tables Please click here for the text description of the image. H and r block 1040ez Actuarial Tables Please click here for the text description of the image. H and r block 1040ez Actuarial tables Please click here for the text description of the image. 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H and r block 1040ez Actuarial tables Requesting a Ruling on Taxation of Annuity If you are a retiree, or the survivor of an employee or retiree, you may ask the Internal Revenue Service to help you determine the taxation of your annuity. H and r block 1040ez If you make this request, you are asking for a ruling. H and r block 1040ez User fee. H and r block 1040ez   Under the law in effect at the time this publication went to print, the IRS must charge a user fee for all ruling requests. H and r block 1040ez You should call the IRS for the proper fee. H and r block 1040ez A request solely for the value of the refund feature is not treated as a ruling request and requires no fee. H and r block 1040ez Send your request to:     Internal Revenue Service  Attention: EP Letter Rulings P. H and r block 1040ez O. H and r block 1040ez Box 27063 McPherson Station Washington, DC 20038 The user fee is allowed as a miscellaneous itemized deduction, subject to the 2%-of-adjusted-gross-income limit. H and r block 1040ez When to make the request. H and r block 1040ez   Please note that requests sent between February 1 and April 15 may experience some delay. H and r block 1040ez We process requests in the order received, and we will reply to your request as soon as we can process it. H and r block 1040ez If you do not receive your ruling by the required filing date, you may use Form 4868, Application for Automatic Extension of Time To File U. H and r block 1040ez S. H and r block 1040ez Individual Income Tax Return, to get an extension of time to file. H and r block 1040ez Information you must furnish. H and r block 1040ez   You must furnish the information listed below so the IRS can comply with your request. H and r block 1040ez Failure to furnish the information will result in a delay in processing your request. H and r block 1040ez Please send only copies of the following documents, as the IRS retains all material sent for its records: A letter explaining the question(s) you wish to have resolved or the information you need from the ruling. H and r block 1040ez Copies of any documents showing distributions, annuity rates, and annuity options available to you. H and r block 1040ez A copy of any Form 1099–R you received since your annuity began. H and r block 1040ez A statement indicating whether you have filed your return for the year for which you are making the request. H and r block 1040ez If you have requested an extension of time to file that return, please indicate the extension date. H and r block 1040ez Your daytime phone number. H and r block 1040ez Your current mailing address. H and r block 1040ez A power of attorney if someone other than you, an attorney, a certified public accountant, or an enrolled agent is signing this request. H and r block 1040ez Form 2848, Power of Attorney and Declaration of Representative, may be used for this purpose. H and r block 1040ez A completed Tax Information Sheet (or facsimile) shown on the next page. H and r block 1040ez Sign and date the Disclosure and Perjury Statement (or facsimile) at the end of the tax information sheet. H and r block 1040ez This statement must be signed by the retiree or the survivor annuitant. H and r block 1040ez It cannot be signed by a representative. H and r block 1040ez Tax Information Sheet Please click here for the text description of the image. H and r block 1040ez Tax Information Sheet Please click here for the text description of the image. H and r block 1040ez Tax Information Sheet (continued) How To Get Tax Help Whether it's help with a tax issue, preparing your tax return or a need for a free publication or form, get the help you need the way you want it: online, use a smart phone, call or walk in to an IRS office or volunteer site near you. H and r block 1040ez Free help with your tax return. H and r block 1040ez   You can get free help preparing your return nationwide from IRS-certified volunteers. H and r block 1040ez The Volunteer Income Tax Assistance (VITA) program helps low-to-moderate income, elderly, people with disabilities, and limited English proficient taxpayers. H and r block 1040ez The Tax Counseling for the Elderly (TCE) program helps taxpayers age 60 and older with their tax returns. H and r block 1040ez Most VITA and TCE sites offer free electronic filing and all volunteers will let you know about credits and deductions you may be entitled to claim. H and r block 1040ez In addition, some VITA and TCE sites provide taxpayers the opportunity to prepare their own return with help from an IRS-certified volunteer. H and r block 1040ez To find the nearest VITA or TCE site, you can use the VITA Locator Tool on IRS. H and r block 1040ez gov, download the IRS2Go app, or call 1-800-906-9887. H and r block 1040ez   As part of the TCE program, AARP offers the Tax-Aide counseling program. H and r block 1040ez To find the nearest AARP Tax-Aide site, visit AARP's website at www. H and r block 1040ez aarp. H and r block 1040ez org/money/taxaide or call 1-888-227-7669. H and r block 1040ez For more information on these programs, go to IRS. H and r block 1040ez gov and enter “VITA” in the search box. H and r block 1040ez Internet. H and r block 1040ez    IRS. H and r block 1040ez gov and IRS2Go are ready when you are —24 hours a day, 7 days a week. H and r block 1040ez Download the free IRS2Go app from the iTunes app store or from Google Play. H and r block 1040ez Use it to check your refund status, order transcripts of your tax returns or tax account, watch the IRS YouTube channel, get IRS news as soon as it's released to the public, subscribe to filing season updates or daily tax tips, and follow the IRS Twitter news feed, @IRSnews, to get the latest federal tax news, including information about tax law changes and important IRS programs. H and r block 1040ez Check the status of your 2013 refund with the Where's My Refund? application on IRS. H and r block 1040ez gov or download the IRS2Go app and select the Refund Status option. H and r block 1040ez The IRS issues more than 9 out of 10 refunds in less than 21 days. H and r block 1040ez Using these applications, you can start checking on the status of your return within 24 hours after we receive your e-filed return or 4 weeks after you mail a paper return. H and r block 1040ez You will also be given a personalized refund date as soon as the IRS processes your tax return and approves your refund. H and r block 1040ez The IRS updates Where's My Refund? every 24 hours, usually overnight, so you only need to check once a day. H and r block 1040ez Use the Interactive Tax Assistant (ITA) to research your tax questions. H and r block 1040ez No need to wait on the phone or stand in line. H and r block 1040ez The ITA is available 24 hours a day, 7 days a week, and provides you with a variety of tax information related to general filing topics, deductions, credits, and income. H and r block 1040ez When you reach the response screen, you can print the entire interview and the final response for your records. H and r block 1040ez New subject areas are added on a regular basis. H and r block 1040ez  Answers not provided through ITA may be found in Tax Trails, one of the Tax Topics on IRS. H and r block 1040ez gov which contain general individual and business tax information or by searching the IRS Tax Map, which includes an international subject index. H and r block 1040ez You can use the IRS Tax Map, to search publications and instructions by topic or keyword. H and r block 1040ez The IRS Tax Map integrates forms and publications into one research tool and provides single-point access to tax law information by subject. H and r block 1040ez When the user searches the IRS Tax Map, they will be provided with links to related content in existing IRS publications, forms and instructions, questions and answers, and Tax Topics. H and r block 1040ez Coming this filing season, you can immediately view and print for free all 5 types of individual federal tax transcripts (tax returns, tax account, record of account, wage and income statement, and certification of non-filing) using Get Transcript. H and r block 1040ez You can also ask the IRS to mail a return or an account transcript to you. H and r block 1040ez Only the mail option is available by choosing the Tax Records option on the IRS2Go app by selecting Mail Transcript on IRS. H and r block 1040ez gov or by calling 1-800-908-9946. H and r block 1040ez Tax return and tax account transcripts are generally available for the current year and the past three years. H and r block 1040ez Determine if you are eligible for the EITC and estimate the amount of the credit with the Earned Income Tax Credit (EITC) Assistant. H and r block 1040ez Visit Understanding Your IRS Notice or Letter to get answers to questions about a notice or letter you received from the IRS. H and r block 1040ez If you received the First Time Homebuyer Credit, you can use the First Time Homebuyer Credit Account Look-up tool for information on your repayments and account balance. H and r block 1040ez Check the status of your amended return using Where's My Amended Return? Go to IRS. H and r block 1040ez gov and enter Where's My Amended Return? in the search box. H and r block 1040ez You can generally expect your amended return to be processed up to 12 weeks from the date we receive it. H and r block 1040ez It can take up to 3 weeks from the date you mailed it to show up in our system. H and r block 1040ez Make a payment using one of several safe and convenient electronic payment options available on IRS. H and r block 1040ez gov. H and r block 1040ez Select the Payment tab on the front page of IRS. H and r block 1040ez gov for more information. H and r block 1040ez Determine if you are eligible and apply for an online payment agreement, if you owe more tax than you can pay today. H and r block 1040ez Figure your income tax withholding with the IRS Withholding Calculator on IRS. H and r block 1040ez gov. H and r block 1040ez Use it if you've had too much or too little withheld, your personal situation has changed, you're starting a new job or you just want to see if you're having the right amount withheld. H and r block 1040ez Determine if you might be subject to the Alternative Minimum Tax by using the Alternative Minimum Tax Assistant on IRS. H and r block 1040ez gov. H and r block 1040ez Request an Electronic Filing PIN by going to IRS. H and r block 1040ez gov and entering Electronic Filing PIN in the search box. H and r block 1040ez Download forms, instructions and publications, including accessible versions for people with disabilities. H and r block 1040ez Locate the nearest Taxpayer Assistance Center (TAC) using the Office Locator tool on IRS. H and r block 1040ez gov, or choose the Contact Us option on the IRS2Go app and search Local Offices. H and r block 1040ez An employee can answer questions about your tax account or help you set up a payment plan. H and r block 1040ez Before you visit, check the Office Locator on IRS. H and r block 1040ez gov, or Local Offices under Contact Us on IRS2Go to confirm the address, phone number, days and hours of operation, and the services provided. H and r block 1040ez If you have a special need, such as a disability, you can request an appointment. H and r block 1040ez Call the local number listed in the Office Locator, or look in the phone book under United States Government, Internal Revenue Service. H and r block 1040ez Apply for an Employer Identification Number (EIN). H and r block 1040ez Go to IRS. H and r block 1040ez gov and enter Apply for an EIN in the search box. H and r block 1040ez Read the Internal Revenue Code, regulations, or other official guidance. H and r block 1040ez Read Internal Revenue Bulletins. H and r block 1040ez Sign up to receive local and national tax news and more by email. H and r block 1040ez Just click on “subscriptions” above the search box on IRS. H and r block 1040ez gov and choose from a variety of options. H and r block 1040ez    Phone. H and r block 1040ez You can call the IRS, or you can carry it in your pocket with the IRS2Go app on your smart phone or tablet. H and r block 1040ez Download the free IRS2Go app from the iTunes app store or from Google Play. H and r block 1040ez Call to locate the nearest volunteer help site, 1-800-906-9887 or you can use the VITA Locator Tool on IRS. H and r block 1040ez gov, or download the IRS2Go app. H and r block 1040ez Low-to-moderate income, elderly, people with disabilities, and limited English proficient taxpayers can get free help with their tax return from the nationwide Volunteer Income Tax Assistance (VITA) program. H and r block 1040ez The Tax Counseling for the Elderly (TCE) program helps taxpayers age 60 and older with their tax returns. H and r block 1040ez Mos
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Research Your Options

  • Learn what rights you have when buying a used car. Contact your state or local consumer protection office.
  • Find out in advance what paperwork you will need to register a vehicle. Contact your state's motor vehicle department.
  • Check prices of similar models using the NADA Official Used Car Guide published by the National Automobile Dealer Association or the Kelley Blue Book. These guides are usually available at local libraries.
  • Research the vehicle's history. Ask the seller for details concerning past owners, use, and maintenance. Next, find out whether the car has been damaged in a flood, involved in a crash, been labeled a lemon or had its odometer rolled back. The vehicle identification number (VIN) will help you do this.
  • Your state motor vehicle department can research the car's title history. Inspect the title for "salvage," "rebuilt", or similar notations.
  • The National Highway Traffic Safety Administration lists VINs of its crash-test vehicles and will let you search an online database of manufacturer service bulletins.
  • Vehiclehistory.gov and the National Insurance Crime Bureau’s free database are centralized places for consumers to buy information on the history of vehicles gathered from state motor vehicle departments and other sources. These reports are helpful but do not guarantee that a vehicle is accident-free.
  • The Center for Auto Safety provides information on safety defects, recalls, and lemons, as well as service bulletins.
  • Make sure any mileage disclosures match the odometer reading on the car.
  • Check the warranty. If a manufacturer's warranty is still in effect, contact the manufacturer to make sure you can use the coverage.
  • Ask about the dealer's return policy. Get it in writing and read it carefully.
  • Have the car inspected by your mechanic. Talk to the seller and agree in advance that you'll pay for the examination if the car passes inspection, but the seller will pay if significant problems are discovered. A qualified mechanic should check the vehicle's frame, tires, air bags and undercarriage, as well as the engine.
  • Examine dealer documents carefully. Make sure you are buying- not leasing- the vehicle. Leases use terms such as "balloon payment" and "base mileage" disclosures.

The H And R Block 1040ez

H and r block 1040ez 6. H and r block 1040ez   Ingresos de Propinas Table of Contents Introduction Useful Items - You may want to see: Cómo Mantener un Registro Diario de PropinasRegistro electrónico de propinas. H and r block 1040ez Cómo Declarar las Propinas a su EmpleadorInforme electrónico de propinas. H and r block 1040ez Declaración final. H and r block 1040ez Cómo se Declaran las Propinas en la Declaración de Impuestos Asignación de Propinas Introduction Este capítulo es para empleados que reciben propinas. H and r block 1040ez Todas las propinas que usted reciba son ingresos y están sujetas al impuesto federal sobre los ingresos. H and r block 1040ez Tiene que incluir en el ingreso bruto todas las propinas que reciba directamente, propinas recibidas por medio de cargos a tarjetas de crédito o débito que le son entregadas por su empleador y su participación de todas las propinas recibidas de un fondo común u otro acuerdo de distribución de propinas. H and r block 1040ez El valor de las propinas que no son pagadas en efectivo, tales como boletos, pases u otros artículos de valor también son ingresos y están sujetos al impuesto. H and r block 1040ez La declaración correcta de los ingresos de propinas no es difícil. H and r block 1040ez Usted tiene que completar tres pasos: Mantener un registro diario de propinas. H and r block 1040ez Declarar sus propinas a su empleador. H and r block 1040ez Declarar todas sus propinas en su declaración de impuestos. H and r block 1040ez  Este capítulo le explicará estos tres pasos y le ayudará a determinar cómo completar su declaración de impuestos si no ha realizado los dos primeros pasos. H and r block 1040ez Este capítulo también le mostrará cómo tratar las propinas asignadas. H and r block 1040ez Para información sobre acuerdos y programas especiales relacionados con las propinas, vea la Publicación 531, en inglés. H and r block 1040ez Useful Items - You may want to see: Publicación 531 Reporting Tip Income (Cómo declarar los ingresos de propinas), en inglés 1244-PR Registro Diario de Propinas Recibidas por el(la) Empleado(a) e Informe al Patrono, en español 1244 Employee's Daily Record of Tips and Report to Employer (Registro Diario de Propinas Recibidas por el(la) Empleado(a) e Informe al Empleador), en inglés Formularios (e Instrucciones) 4137 Social Security and Medicare Tax on Unreported Tip Income (Impuestos del Seguro Social y Medicare sobre el ingreso de propinas no declaradas), en inglés 4070-PR Informe al Patrono de Propinas Recibidas por el(la) Empleado(a), disponible en español 4070 Employee's Report of Tips to Employer (Informe al Empleador de Propinas Recibidas por el(la) Empleado(a)), en inglés Cómo Mantener un Registro Diario de Propinas ¿Por qué mantener un registro diario de propinas?   Usted tiene que mantener un registro diario de propinas para que pueda: Declarar sus propinas correctamente a su empleador, Declarar sus propinas correctamente en su declaración de impuestos y Comprobar sus ingresos de propinas si se cuestiona su declaración. H and r block 1040ez Cómo mantener un registro diario de propinas. H and r block 1040ez   Hay dos maneras de mantener un registro diario de propinas. H and r block 1040ez Puede optar por: Anotar la información sobre sus propinas en un diario de propinas o Mantener copias de documentos que comprueben sus propinas, tales como cuentas de restaurantes y recibos de cargos hechos a tarjetas de crédito o de débito. H and r block 1040ez Usted debe mantener su registro diario de propinas junto con su documentación tributaria u otra documentación personal. H and r block 1040ez Tiene que guardar su documentación por el tiempo en que sea importante para la aplicación de la ley tributaria federal. H and r block 1040ez Para información sobre cuánto tiempo debe guardar esta documentación, vea el tema titulado Cuánto Tiempo Debe Mantener Los Documentos , en el capítulo 1. H and r block 1040ez    Si mantiene un registro de propinas, puede utilizar el Formulario 4070A-PR, Registro Diario de Propinas del(la) Empleado(a) (o el Formulario 4070-A, en inglés). H and r block 1040ez Para obtener el Formulario 4070A-PR (o el Formulario 4070-A), pídale al IRS o a su empleador la Publicación 1244-PR (o la Publicación 1244, en inglés). H and r block 1040ez Asimismo, la Publicación 1244-PR está disponible en el sitio web www. H and r block 1040ez irs. H and r block 1040ez gov/pub/irs-pdf/p1244pr. H and r block 1040ez pdf. H and r block 1040ez La Publicación 1244-PR (o la Publicación 1244, en inglés) contiene suficientes copias del Formulario 4070A-PR (o del Formulario 4070-A, en inglés) para un año. H and r block 1040ez Cada día, anote la información solicitada en el formulario. H and r block 1040ez   Además de la información solicitada en el Formulario 4070A-PR, también es necesario que mantenga un registro u otra documentación de la fecha y el valor de toda propina que reciba que no sea en efectivo, tales como boletos, pases u otros artículos de valor. H and r block 1040ez Aunque no declara estas propinas a su empleador, tiene que declararlas en su declaración de impuestos. H and r block 1040ez   Si no utiliza el Formulario 4070A-PR (o el Formulario 4070-A, en inglés), comience su registro escribiendo su nombre, el nombre de su empleador y el nombre del negocio o establecimiento donde trabaja si es distinto al nombre de su empleador. H and r block 1040ez Luego, cada día que trabaje, anote la fecha y la siguiente información: Propinas en efectivo que obtiene directamente de los clientes o de otros empleados. H and r block 1040ez Propinas de los clientes que pagan con tarjeta de crédito y de débito que su empleador le paga. H and r block 1040ez El valor de toda propina que haya recibido que no sea pagada en efectivo, tales como boletos, pases y otros artículos de valor. H and r block 1040ez La cantidad de propinas que usted le pagó a otros empleados a través de un fondo común u otro acuerdo de distribución de propinas y los nombres de los empleados a los cuales les pagó las propinas. H and r block 1040ez Registro electrónico de propinas. H and r block 1040ez   Usted puede utilizar un sistema electrónico provisto por su empleador para mantener un registro de propinas diarias. H and r block 1040ez En tal caso, tiene que recibir y guardar una copia en papel de este registro. H and r block 1040ez Cargos por servicios. H and r block 1040ez   No anote en su registro de propinas la cantidad de ningún cargo por servicios que su empleador añada a la cuenta de un cliente y que luego le pague a usted y que el empleador trate como salario de usted. H and r block 1040ez Los cargos de este tipo son parte de su salario, no son propinas. H and r block 1040ez Vea los ejemplos que se presentan a continuación. H and r block 1040ez Ejemplo 1. H and r block 1040ez El restaurante Buena Comida añade un cargo del 18% a la cuenta de grupos de 6 o más clientes. H and r block 1040ez Juanita forma parte de un grupo de 8 personas. H and r block 1040ez Además del costo de la comida y bebidas que se sirvieron a todos en el grupo de Juanita, la cuenta incluye un monto igual al 18% del costo de las mismas, el cual aparece en la línea para anotar propinas. H and r block 1040ez Dicho monto se incluye en el total de la cuenta. H and r block 1040ez Debido a que Juanita no tenía un derecho ilimitado de determinar el monto en la línea para anotar propinas, el cargo del 18% se considera un cargo por servicios. H and r block 1040ez No anote el cargo del 18% en su registro de propinas. H and r block 1040ez Los cargos por servicios que se le paguen son considerados salarios y no propinas. H and r block 1040ez Ejemplo 2. H and r block 1040ez El restaurante Buena Comida también incluye ejemplos de cálculos para las cantidades de propinas en la parte inferior de la cuenta para la comida y las bebidas servidas a los clientes. H and r block 1040ez En la parte inferior de la cuenta de David, debajo de la línea para la firma, se incluye una línea en blanco para anotar propinas, además de ejemplos de propinas calculadas en base al 15%, 18% y 20% de los costos de la comida y bebidas que le sirvieron. H and r block 1040ez Debido a que David tenía libertad para anotar cualquier cantidad en la línea para anotar propinas, o dejarla en blanco, cualquier cantidad que David anote se considera propina. H and r block 1040ez Cerciórese de incluir esta cantidad en su registro de propinas. H and r block 1040ez Cómo Declarar las Propinas a su Empleador ¿Por qué tiene que declarar sus propinas a su empleador?   Tiene que declarar sus propinas a su empleador para que: Éste pueda retenerle impuesto federal sobre el ingreso, impuestos del Seguro Social, impuestos de Medicare, Impuesto Adicional del Medicare o impuestos de la jubilación ferroviaria, Éste pueda declarar la cantidad correcta de sus ganancias a la Administración del Seguro Social o a la Junta de la Jubilación Ferroviaria (lo cual afecta sus beneficios cuando se jubile o si queda incapacitado, o los beneficios de su familia cuando usted fallezca) y Usted pueda evitar la Multa por no declarar las propinas a su empleador (tema explicado más adelante). H and r block 1040ez Propinas que tiene que declarar a su empleador. H and r block 1040ez   Declárele a su empleador solamente las propinas que reciba en efectivo, en cheques, tarjetas de débito y de crédito. H and r block 1040ez   Si el total de las propinas que reciba de un trabajo en un mes determinado es menos de $20, no declare las propinas de ese mes a ese empleador. H and r block 1040ez   Si recibe propinas conforme a un acuerdo para compartir propinas equitativamente, declare sólo las propinas que reciba y retenga. H and r block 1040ez No declare a su empleador ninguna parte de las propinas que reciba para luego entregárselas a otros empleados. H and r block 1040ez Sin embargo, tiene que declarar las propinas que reciba de otros empleados. H and r block 1040ez    No declare a su empleador el valor de las propinas que no reciba en efectivo, tales como boletos o pases. H and r block 1040ez No se pagan impuestos del Seguro Social, Medicare, Impuesto Adicional del Medicare o impuestos de la jubilación ferroviaria sobre estas propinas. H and r block 1040ez Cómo se declaran las propinas. H and r block 1040ez    Si su empleador no le proporciona otro medio para declarar las propinas, puede usar el Formulario 4070-PR, en español (o el Formulario 4070, en inglés). H and r block 1040ez Escriba la información requerida en el formulario, incluya su firma y la fecha y entrégueselo a su empleador. H and r block 1040ez Si desea obtener copias del formulario para un año completo, comuníquese con el IRS o pídale a su empleador la Publicación 1244-PR (o la Publicación 1244, en inglés). H and r block 1040ez   Si no usa el Formulario 4070-PR (o el Formulario 4070, en inglés), entréguele a su empleador un informe con la información siguiente: Su nombre, dirección y número de Seguro Social. H and r block 1040ez El nombre de su empleador, la dirección y el nombre del establecimiento (si es diferente al nombre del empleador). H and r block 1040ez El mes (o las fechas de cualquier período más corto) en el cual usted recibió propinas. H and r block 1040ez El total de propinas que se tienen que declarar para ese período. H and r block 1040ez Usted tiene que firmar y fechar el informe. H and r block 1040ez Cerciórese de guardar una copia junto con sus documentos tributarios u otros documentos personales. H and r block 1040ez   Su empleador puede requerirle que declare sus propinas más de una vez al mes. H and r block 1040ez Sin embargo, el informe no puede abarcar un período mayor de un mes natural. H and r block 1040ez Informe electrónico de propinas. H and r block 1040ez   Su empleador puede exigir que facilite su informe de propinas por medios electrónicos. H and r block 1040ez Cuándo debe declarar las propinas. H and r block 1040ez   Entregue a su empleador el informe correspondiente a cada mes, a más tardar el día 10 del mes siguiente. H and r block 1040ez Si el día 10 cae en sábado, domingo o día feriado legal, entonces entréguele el informe a su empleador el próximo día siempre que no sea sábado, domingo o día feriado legal. H and r block 1040ez Ejemplo. H and r block 1040ez Tiene que declararle a su empleador la cantidad de propinas que recibió en septiembre del año 2014 a más tardar el día 10 de octubre de 2014. H and r block 1040ez Declaración final. H and r block 1040ez   Si deja de trabajar durante el mes, puede declarar las propinas recibidas cuando termine su empleo. H and r block 1040ez Multa por no declarar las propinas. H and r block 1040ez   Si no le declara a su empleador las propinas que recibió, tal como se requiere, puede estar sujeto a que se le imponga una multa equivalente al 50% de los impuestos del Seguro Social, Medicare, Impuesto Adicional del Medicare o impuesto de la jubilación ferroviaria que adeude sobre las propinas que no declaró. H and r block 1040ez (Para información sobre estos impuestos, vea Cómo declarar los impuestos del Seguro Social, Medicare, Impuesto Adicional del Medicare o impuesto de la jubilación ferroviaria sobre las propinas no declaradas a su empleador , bajo Cómo se Declaran las Propinas en la Declaración de Impuestos, más adelante). H and r block 1040ez La cantidad de la multa que se impone es adicional a los impuestos que adeude. H and r block 1040ez   Puede evitar que esta multa le sea impuesta si puede demostrar que existe causa razonable por la cual no le declaró las propinas a su empleador. H and r block 1040ez Para hacerlo, adjunte un documento escrito a su declaración de impuestos explicando la razón por la cual no declaró la cantidad de propinas que recibió. H and r block 1040ez Entrega de dinero al empleador para el pago de los impuestos. H and r block 1040ez   Es posible que lo que gana normalmente no sea suficiente para que su empleador le retenga todos los impuestos que adeude sobre su salario normal más las propinas que recibe. H and r block 1040ez Si esto ocurre, puede entregarle dinero a su empleador hasta el cierre del año natural para pagar el resto de los impuestos. H and r block 1040ez   Si no le entrega dinero suficiente a su empleador, el mismo aplicará su salario normal y todo dinero que usted le entregue para los impuestos, en el orden siguiente: Todos los impuestos sobre su salario normal. H and r block 1040ez Los impuestos del Seguro Social, Medicare, Impuesto Adicional del Medicare o impuestos de la jubilación ferroviaria sobre las propinas que declaró. H and r block 1040ez Los impuestos federales, estatales y locales sobre los ingresos sobre las propinas que declaró. H and r block 1040ez    Su empleador puede descontar de su próximo salario todo impuesto que quede pendiente. H and r block 1040ez Si al final del año aún no se le han retenido suficientes impuestos, usted puede estar sujeto a una multa por pago insuficiente de impuestos estimados. H and r block 1040ez Vea la Publicación 505, Tax Withholding and Estimated Tax (Retención de impuestos e impuesto estimado), en inglés, para más información. H and r block 1040ez    Impuestos no recaudados. H and r block 1040ez Usted tiene que informar en su declaración de impuestos todo impuesto del Seguro Social y Medicare o impuestos de la jubilación ferroviaria que no se recaudaron al final del año 2013. H and r block 1040ez Estos impuestos no recaudados aparecerán en su Formulario W-2 del año 2013. H and r block 1040ez Vea el tema titulado Cómo se declaran los impuestos no recaudados del Seguro Social, Medicare o impuesto de la jubilación ferroviaria sobre propinas declaradas a su empleador , bajo Cómo se Declaran las Propinas en la Declaración de Impuestos, a continuación. H and r block 1040ez Cómo se Declaran las Propinas en la Declaración de Impuestos Cómo se declaran las propinas. H and r block 1040ez    Declare las propinas que recibió junto con su salario en la línea 7 del Formulario 1040, la línea 7 del Formulario 1040A o en la línea 1 del Formulario 1040EZ. H and r block 1040ez Qué propinas se tienen que declarar. H and r block 1040ez   Usted tiene que informar en su declaración de impuestos todas las propinas que recibió en 2013. H and r block 1040ez Incluya las que recibió en efectivo y las que no fueron en efectivo. H and r block 1040ez Toda propina que usted haya declarado en 2013 a su empleador está incluida en los salarios que aparecen en el recuadro 1 de su Formulario W-2. H and r block 1040ez Sume a la cantidad del recuadro 1 solamente las propinas que usted no le declaró a su empleador. H and r block 1040ez    Si recibió $20 o más en propinas en efectivo o cargadas a tarjetas de crédito o débito en un mes y no las declaró a su empleador, vea más adelante el tema titulado Cómo declarar los impuestos del Seguro Social, Medicare, Impuesto Adicional del Medicare o impuesto de la jubilación ferroviaria sobre las propinas no declaradas a su empleador . H and r block 1040ez    Si usted no llevó un registro diario de las propinas que recibió, tal como se requiere, y aparece una cantidad en el recuadro 8 del Formulario W-2, vea más adelante la sección titulada Asignación de Propinas . H and r block 1040ez   Si usted llevó un registro diario y declaró a su empleador todas las propinas que recibió, tal como se requiere conforme a las reglas explicadas anteriormente, añada a la cantidad que aparece en el recuadro 1 de su Formulario W-2 las siguientes propinas: Las propinas que recibió tanto en efectivo como cargadas a tarjetas de crédito o débito que fueron menos de $20 en un mes cualquiera. H and r block 1040ez El valor de las propinas que no recibió en efectivo, tales como boletos, pases u otros artículos de valor. H and r block 1040ez Ejemplo. H and r block 1040ez Mariano Almendares comenzó a trabajar en el Restaurante Océano Azul (su único empleador en el año 2013) el día 30 de junio y recibió $10,000 en salarios durante el año. H and r block 1040ez Mariano llevó un registro diario de las propinas que recibió durante el año, el cual muestra que en junio recibió $18 en propinas y en el resto del año recibió $7,000 en propinas. H and r block 1040ez Al Sr. H and r block 1040ez Almendares no se le requirió declararle a su empleador las propinas que recibió en junio, pero sí le declaró todas las propinas que recibió durante el resto del año, tal como se requiere. H and r block 1040ez El Formulario W-2 que el Sr. H and r block 1040ez Almendares recibió del Restaurante Océano Azul muestra $17,000 ($10,000 de salario más $7,000 de propinas declaradas) en el recuadro 1. H and r block 1040ez El Sr. H and r block 1040ez Almendares añade a esa cantidad los $18 de propinas que no le declaró al empleador y declara $17,018 como salario en su declaración de impuestos. H and r block 1040ez Cómo declarar los impuestos del Seguro Social, Medicare, Impuesto Adicional del Medicare o impuesto de la jubilación ferroviaria sobre las propinas no declaradas a su empleador. H and r block 1040ez    Si en un mes recibió $20 o más en propinas en efectivo o cargadas a tarjetas de crédito o débito en algún empleo y no declaró todas esas propinas a su empleador, tiene que declarar como impuesto adicional los impuestos del Seguro Social, Medicare e Impuesto Adicional del Medicare sobre las propinas que no declaró a su empleador. H and r block 1040ez Para declarar estos impuestos, tiene que presentar una declaración aunque de otro modo no tuviera que presentarla. H and r block 1040ez Para hacerlo, tiene que usar el Formulario 1040. H and r block 1040ez (No puede presentar el Formulario 1040EZ ni el Formulario 1040A). H and r block 1040ez    Use el Formulario 4137, Social Security and Medicare Tax on Unreported Tip Income (Impuestos del Seguro Social y de Medicare sobre el ingreso de propinas no declaradas), en inglés, para calcular los impuestos al Seguro Social y al Medicare. H and r block 1040ez Anote el impuesto en su declaración como se indica y adjunte el Formulario 4137 debidamente completado a la misma. H and r block 1040ez Use el Formulario 8959, en inglés, para calcular el Impuesto Adicional del Medicare. H and r block 1040ez    Si usted está sujeto a la Railroad Retirement Tax Act (Ley Tributaria para la Jubilación Ferroviaria), no puede utilizar el Formulario 4137 para pagar el impuesto para la jubilación ferroviaria sobre propinas no declaradas. H and r block 1040ez Para obtener crédito para la jubilación ferroviaria, tiene que declarar sus propinas a su empleador. H and r block 1040ez Cómo se declaran los impuestos no recaudados del Seguro Social, Medicare o impuesto de la jubilación ferroviaria sobre propinas declaradas a su empleador. H and r block 1040ez   Usted podría tener impuestos sin recaudar si su salario normal no es suficiente para que su empleador retenga todos los impuestos adeudados y si no le dio a su empleador dinero suficiente para pagar el resto de los impuestos. H and r block 1040ez Para más información, vea Entrega de dinero al empleador para el pago de los impuestos , bajo Cómo Declarar las Propinas a su Empleador, anteriormente. H and r block 1040ez   Si su empleador no pudo recaudar todos los impuestos al Seguro Social y al Medicare o impuesto de la jubilación ferroviaria que usted adeuda sobre propinas declaradas para 2013, los impuestos por recaudar se mostrarán en el recuadro 12 del Formulario W-2 (códigos A y B). H and r block 1040ez Tiene que declarar estas cantidades como impuesto adicional en su declaración. H and r block 1040ez A diferencia de la parte no recaudada del impuesto regular al Medicare (1. H and r block 1040ez 45%), el Impuesto Adicional del Medicare no recaudado no se declara en el recuadro 12 del Formulario W-2 con el código B. H and r block 1040ez    Para declarar estos impuestos no recaudados, tiene que presentar una declaración aunque no tuviera que presentarla de otro modo. H and r block 1040ez Tiene que declarar estos impuestos en la línea 60 del Formulario 1040. H and r block 1040ez Vea las instrucciones para la línea 60 del Formulario 1040, disponibles en inglés. H and r block 1040ez (No puede presentar el Formulario 1040EZ ni el Formulario 1040A). H and r block 1040ez Asignación de Propinas Si su empleador le asignó propinas, las mismas aparecen por separado en el recuadro 8 de su Formulario W-2. H and r block 1040ez Estas propinas no están incluidas en el recuadro 1 con sus salarios y propinas declaradas. H and r block 1040ez Si el recuadro 8 está en blanco, lo que se explica en esta sección no es aplicable en su caso. H and r block 1040ez ¿Qué son propinas asignadas?   Éstas son propinas que su empleador le asignó, además de las que usted le declaró para el año. H and r block 1040ez Su empleador habrá hecho esto únicamente si: Usted trabajó en un establecimiento (restaurante, bar o negocio similar) que tiene que asignar las propinas a los empleados y La cantidad de propinas que declaró a su empleador fue menos de su parte del 8% de las ventas de comidas y bebidas del establecimiento donde usted trabajó. H and r block 1040ez De las propinas asignadas, no se retienen impuestos sobre los ingresos, Seguro Social, Medicare, Impuesto Adicional del Medicare ni impuestos de la jubilación ferroviaria. H and r block 1040ez ¿Cómo se calcula su asignación de propinas?   Las propinas que se le asignan a usted son su parte de una cantidad calculada restando las propinas declaradas de todos los empleados del 8% (u otra tasa más baja aprobada) de las ventas de comida y bebida (que no sean ventas de comida para llevar por los clientes o ventas con un cargo por servicio del 10% o más). H and r block 1040ez Su parte de esa cantidad fue calculada utilizando un método provisto por un acuerdo laboral entre empleador y empleado o por un método provisto por los reglamentos del IRS basado en las ventas hechas o las horas trabajadas por los empleados. H and r block 1040ez Para más información sobre el método de asignación exacto utilizado, consulte a su empleador. H and r block 1040ez ¿Tiene que incluir en la declaración sus propinas asignadas?   Tiene que incluir en la declaración de impuestos todas las propinas que recibió en 2013, incluyendo las propinas pagadas en efectivo como las no pagadas en efectivo. H and r block 1040ez Todas las propinas que usted haya declarado en 2013 a su empleador están incluidas en los salarios que aparecen en el recuadro 1 de su Formulario W-2. H and r block 1040ez Sume a la cantidad del recuadro 1 solamente las propinas que usted no le declaró a su empleador. H and r block 1040ez Esto tiene que incluir toda propina asignada mostrada en el recuadro 8 de su(s) Formulario(s) W-2, a menos que tenga registros confiables que muestren que recibió menos propinas en el año que las cifras asignadas. H and r block 1040ez   Vea los temas titulados Qué propinas se tienen que declarar , bajo Cómo se Declaran las Propinas en la Declaración de Impuestos y Cómo Mantener un Registro Diario de Propinas , anteriormente. H and r block 1040ez Cómo declarar las propinas asignadas. H and r block 1040ez   Declare la cantidad en el recuadro 1 y las propinas asignadas en el recuadro 8 de su(s) Formulario(s) W-2 como salario en la línea 7 del Formulario 1040, en la línea 8 del Formulario 1040NR o en la línea 3 del Formulario 1040NR-EZ. H and r block 1040ez (No puede presentar el Formulario 1040A ni el Formulario 1040EZ cuando se tienen propinas asignadas). H and r block 1040ez    Debido a que los impuestos del Seguro Social, Medicare o Impuesto Adicional del Medicare no fueron retenidos de las propinas asignadas, tiene que declararlos como impuestos adicionales en su declaración. H and r block 1040ez Complete el Formulario 4137 e incluya las propinas asignadas en la línea 1 del formulario. H and r block 1040ez Vea Cómo declarar los impuestos del Seguro Social, Medicare, Impuesto Adicional del Medicare o impuesto de la jubilación ferroviaria sobre las propinas no declaradas a su empleador , bajo Cómo se Declaran las Propinas en la Declaración de Impuestos. H and r block 1040ez Prev  Up  Next   Home   More Online Publications