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H&r Block Free Tax Return

H&r block free tax return 5. H&r block free tax return   Exemptions, Deductions, and Credits Table of Contents Topics - This chapter discusses: Useful Items - You may want to see: Items Related to Excluded Income Exemptions Contributions to Foreign Charitable Organizations Moving ExpensesAllocation of Moving Expenses Forms To File Contributions to Individual Retirement Arrangements Taxes of Foreign Countries and U. H&r block free tax return S. H&r block free tax return PossessionsCredit for Foreign Income Taxes Deduction for Foreign Income Taxes Deduction for Other Foreign Taxes How To Report Deductions Topics - This chapter discusses: The rules concerning items related to excluded income, Exemptions, Contributions to foreign charitable organizations, Moving expenses, Contributions to individual retirement arrangements (IRAs), Taxes of foreign countries and U. H&r block free tax return S. H&r block free tax return possessions, and How to report deductions. H&r block free tax return Useful Items - You may want to see: Publication 501 Exemptions, Standard Deduction, and Filing Information 514 Foreign Tax Credit for Individuals 521 Moving Expenses 523 Selling Your Home 590 Individual Retirement Arrangements (IRAs) 597 Information on the United States—Canada Income Tax Treaty Form (and Instructions) 1116 Foreign Tax Credit 2106 Employee Business Expenses 2555 Foreign Earned Income 2555-EZ Foreign Earned Income Exclusion 3903 Moving Expenses Schedule A (Form 1040) Itemized Deductions Schedule C (Form 1040) Profit or Loss From Business SS-5 Application for a Social Security Card W-7 Application for IRS Individual Taxpayer Identification Number See chapter 7 for information about getting these publications and forms. H&r block free tax return Items Related to Excluded Income U. H&r block free tax return S. H&r block free tax return citizens and resident aliens living outside the United States generally are allowed the same deductions as citizens and residents living in the United States. H&r block free tax return If you choose to exclude foreign earned income or housing amounts, you cannot deduct, exclude, or claim a credit for any item that can be allocated to or charged against the excluded amounts. H&r block free tax return This includes any expenses, losses, and other normally deductible items that are allocable to the excluded income. H&r block free tax return You can deduct only those expenses connected with earning includible income. H&r block free tax return These rules apply only to items definitely related to the excluded earned income and they do not apply to other items that are not definitely related to any particular type of gross income. H&r block free tax return These rules do not apply to items such as: Personal exemptions, Qualified retirement contributions, Alimony payments, Charitable contributions, Medical expenses, Mortgage interest, or Real estate taxes on your personal residence. H&r block free tax return For purposes of these rules, your housing deduction is not treated as allocable to your excluded income, but the deduction for self- employment tax is. H&r block free tax return If you receive foreign earned income in a tax year after the year in which you earned it, you may have to file an amended return for the earlier year to properly adjust the amounts of deductions, credits, or exclusions allocable to your foreign earned income and housing exclusions. H&r block free tax return Example. H&r block free tax return In 2012, you had $90,400 of foreign earned income and $9,500 of deductions allocable to your foreign earned income. H&r block free tax return You did not have a housing exclusion. H&r block free tax return Because you excluded all of your foreign earned income, you would not have been able to claim any of the deductions on your 2012 return. H&r block free tax return In 2013, you received a $12,000 bonus for work you did abroad in 2012. H&r block free tax return You can exclude $4,700 of the bonus because the limit on the foreign earned income exclusion for 2012 was $95,100 and you have already excluded $90,400. H&r block free tax return Since you must include $7,300 of the bonus ($12,000 − $4,700) for work you did in 2012 in income, you can file an amended return for 2012 to claim $677 of the deductions. H&r block free tax return This is the deductions allocable to the foreign earned income ($9,500) multiplied by the includible portion of the foreign earned income ($7,300) and divided by the total foreign earned income for 2012 ($102,400). H&r block free tax return Exemptions You can claim an exemption for your nonresident alien spouse on your separate return, provided your spouse has no gross income for U. H&r block free tax return S. H&r block free tax return tax purposes and is not the dependent of another U. H&r block free tax return S. H&r block free tax return taxpayer. H&r block free tax return You also can claim exemptions for individuals who qualify as your dependents. H&r block free tax return To be your dependent, the individual must be a U. H&r block free tax return S. H&r block free tax return citizen, U. H&r block free tax return S. H&r block free tax return national, U. H&r block free tax return S. H&r block free tax return resident alien, or a resident of Canada or Mexico for some part of the calendar year in which your tax year begins. H&r block free tax return Children. H&r block free tax return   Children usually are citizens or residents of the same country as their parents. H&r block free tax return If you were a U. H&r block free tax return S. H&r block free tax return citizen when your child was born, your child generally is a U. H&r block free tax return S. H&r block free tax return citizen. H&r block free tax return This is true even if the child's other parent is a nonresident alien, the child was born in a foreign country, and the child lives abroad with the other parent. H&r block free tax return   If you have a legally adopted child who is not a U. H&r block free tax return S. H&r block free tax return citizen, U. H&r block free tax return S. H&r block free tax return resident, or U. H&r block free tax return S. H&r block free tax return national, the child meets the citizen requirement if you are a U. H&r block free tax return S. H&r block free tax return citizen or U. H&r block free tax return S. H&r block free tax return national and the child lived with you as a member of your household all year. H&r block free tax return Social security number. H&r block free tax return   You must include on your return the social security number (SSN) of each dependent for whom you claim an exemption. H&r block free tax return To get a social security number for a dependent, apply at a Social Security office or U. H&r block free tax return S. H&r block free tax return consulate. H&r block free tax return You must provide original or certified copies of documents to verify the dependent's age, identity, and citizenship, and complete Form SS-5. H&r block free tax return   If you do not have an SSN for a child who was born in 2013 and died in 2013, attach a copy of the child's birth certificate to your tax return. H&r block free tax return Print “Died” in column (2) of line 6c of your Form 1040 or Form 1040A. H&r block free tax return   If your dependent is a nonresident alien who is not eligible to get a social security number, you must list the dependent's individual taxpayer identification number (ITIN) instead of an SSN. H&r block free tax return To apply for an ITIN, file Form W-7 with the IRS. H&r block free tax return It usually takes 6 to 10 weeks to get an ITIN. H&r block free tax return Enter your dependent's ITIN wherever an SSN is requested on your tax return. H&r block free tax return More information. H&r block free tax return   For more information about exemptions, see Publication 501. H&r block free tax return Contributions to Foreign Charitable Organizations If you make contributions directly to a foreign church or other foreign charitable organization, you generally cannot deduct them. H&r block free tax return Exceptions are explained under Canadian, Mexican, and Israeli charities, later. H&r block free tax return You can deduct contributions to a U. H&r block free tax return S. H&r block free tax return organization that transfers funds to a charitable foreign organization if the U. H&r block free tax return S. H&r block free tax return organization controls the use of the funds by the foreign organization or if the foreign organization is just an administrative arm of the U. H&r block free tax return S. H&r block free tax return organization. H&r block free tax return Canadian, Mexican, and Israeli charities. H&r block free tax return   Under the income tax treaties with Canada, Mexico and Israel, you may be able to deduct contributions to certain Canadian, Mexican, and Israeli charitable organizations. H&r block free tax return Generally, you must have income from sources in Canada, Mexico, or Israel, and the organization must meet certain requirements. H&r block free tax return See Publication 597, Information on the United States-Canada Income Tax Treaty, and Publication 526, Charitable Contributions, for more information. H&r block free tax return Moving Expenses If you moved to a new home in 2013 because of your job or business, you may be able to deduct the expenses of your move. H&r block free tax return Generally, to be deductible, the moving expenses must have been paid or incurred in connection with starting work at a new job location. H&r block free tax return See Publication 521 for a complete discussion of the deduction for moving expenses and information about moves within the United States. H&r block free tax return Foreign moves. H&r block free tax return   A foreign move is a move in connection with the start of work at a new job location outside the United States and its possessions. H&r block free tax return A foreign move does not include a move back to the United States or its possessions. H&r block free tax return Allocation of Moving Expenses When your new place of work is in a foreign country, your moving expenses are directly connected with the income earned in that foreign country. H&r block free tax return If you exclude all or part of the income that you earn at the new location under the foreign earned income exclusion or the foreign housing exclusion, you cannot deduct the part of your moving expense that is allocable to the excluded income. H&r block free tax return Also, you cannot deduct the part of the moving expense related to the excluded income for a move from a foreign country to the United States if you receive a reimbursement that you are able to treat as compensation for services performed in the foreign country. H&r block free tax return Year to which expense is connected. H&r block free tax return   The moving expense is connected with earning the income (including reimbursements, as discussed in chapter 4 under Reimbursement of moving expenses ) either entirely in the year of the move or in 2 years. H&r block free tax return It is connected with earning the income entirely in the year of the move if you qualify for the foreign earned income exclusion under the bona fide residence test or physical presence test for at least 120 days during that tax year. H&r block free tax return   If you do not qualify under either the bona fide residence test or the physical presence test for at least 120 days during the year of the move, the expense is connected with earning the income in 2 years. H&r block free tax return The moving expense is connected with the year of the move and the following year if the move is from the United States to a foreign country. H&r block free tax return The moving expense is connected with the year of the move and the preceding year if the move is from a foreign country to the United States. H&r block free tax return Amount allocable to excluded income. H&r block free tax return   To figure the amount of your moving expense that is allocable to your excluded foreign earned income (and not deductible), you must multiply your total moving expense deduction by a fraction. H&r block free tax return The numerator (top number) of the fraction is the total of your excluded foreign earned income and housing amounts for both years and the denominator (bottom number) of the fraction is your total foreign earned income for both years. H&r block free tax return Example. H&r block free tax return On November 1, 2012, you transfer to Monaco. H&r block free tax return Your tax home is in Monaco, and you are a bona fide resident of Monaco for the entire tax year 2013. H&r block free tax return In 2012, you paid $6,000 for allowable moving expenses for your move from the United States to Monaco. H&r block free tax return You were fully reimbursed (under a nonaccountable plan) for these expenses in the same year. H&r block free tax return The reimbursement is included in your income. H&r block free tax return Your only other income consists of $16,000 wages earned in 2012 after the date of your move, and $100,100 wages earned in Monaco for 2013. H&r block free tax return Because you did not meet the bona fide residence test for at least 120 days during 2012, the year of the move, the moving expenses are for services you performed in both 2012 and the following year, 2013. H&r block free tax return Your total foreign earned income for both years is $122,100, consisting of $16,000 wages for 2012, $100,100 wages for 2013, and $6,000 moving expense reimbursement for both years. H&r block free tax return You have no housing exclusion. H&r block free tax return The total amount you can exclude is $113,190, consisting of the $97,600 full-year exclusion for 2013 and a $15,590 part-year exclusion for 2012 ($95,100 times the fraction of 60 qualifying bona fide residence days over 366 total days in the year). H&r block free tax return To find the part of your moving expenses that is not deductible, multiply your $6,000 total expenses by the fraction $113,190 over $122,100. H&r block free tax return The result, $5,562, is your nondeductible amount. H&r block free tax return    You must report the full amount of the moving expense reimbursement in the year in which you received the reimbursement. H&r block free tax return In the preceding example, this year was 2012. H&r block free tax return You attribute the reimbursement to both 2012 and 2013 only to figure the amount of foreign earned income eligible for exclusion for each year. H&r block free tax return Move between foreign countries. H&r block free tax return   If you move between foreign countries, your moving expense is allocable to income earned in the year of the move if you qualified under either the bona fide residence test or the physical presence test for a period that includes at least 120 days in the year of the move. H&r block free tax return New place of work in U. H&r block free tax return S. H&r block free tax return   If your new place of work is in the United States, the deductible moving expenses are directly connected with the income earned in the United States. H&r block free tax return If you treat a reimbursement from your employer as foreign earned income (see the discussion in chapter 4), you must allocate deductible moving expenses to foreign earned income. H&r block free tax return Storage expenses. H&r block free tax return   These expenses are attributable to work you do during the year in which you incur the storage expenses. H&r block free tax return You cannot deduct the amount allocable to excluded income. H&r block free tax return Moving Expense Attributable to Foreign Earnings in 2 Years If your moving expense deduction is attributable to your foreign earnings in 2 years (the year of the move and the following year), you should request an extension of time to file your return for the year of the move until after the end of the second year. H&r block free tax return By then, you should have all the information needed to properly figure the moving expense deduction. H&r block free tax return See Extensions under When To File and Pay in chapter 1. H&r block free tax return If you do not request an extension, you should figure the part of the moving expense that you cannot deduct because it is allocable to the foreign earned income you are excluding. H&r block free tax return You do this by multiplying the moving expense by a fraction, the numerator (top number) of which is your excluded foreign earned income for the year of the move, and the denominator (bottom number) of which is your total foreign earned income for the year of the move. H&r block free tax return Once you know your foreign earnings and exclusion for the following year, you must either: Adjust the moving expense deduction by filing an amended return for the year of the move, or Recapture any additional unallowable amount as income on your return for the following year. H&r block free tax return If, after you make the final computation, you have an additional amount of allowable moving expense deduction, you can claim this only on an amended return for the year of the move. H&r block free tax return You cannot claim it on the return for the second year. H&r block free tax return Forms To File Report your moving expenses on Form 3903. H&r block free tax return Report your moving expense deduction on line 26 of Form 1040. H&r block free tax return If you must reduce your moving expenses by the amount allocable to excluded income (as explained later under How To Report Deductions ), attach a statement to your return showing how you figured this amount. H&r block free tax return For more information about figuring moving expenses, see Publication 521. H&r block free tax return Contributions to Individual Retirement Arrangements Contributions to your individual retirement arrangements (IRAs) that are traditional IRAs or Roth IRAs are generally limited to the lesser of $5,500 ($6,500 if 50 or older) or your compensation that is includible in your gross income for the tax year. H&r block free tax return In determining compensation for this purpose, do not take into account amounts you exclude under either the foreign earned income exclusion or the foreign housing exclusion. H&r block free tax return Do not reduce your compensation by the foreign housing deduction. H&r block free tax return If you are covered by an employer retirement plan at work, your deduction for your contributions to your traditional IRAs is generally limited based on your modified adjusted gross income. H&r block free tax return This is your adjusted gross income figured without taking into account the foreign earned income exclusion, the foreign housing exclusion, or the foreign housing deduction. H&r block free tax return Other modifications are also required. H&r block free tax return For more information on IRAs, see Publication 590. H&r block free tax return Taxes of Foreign Countries and U. H&r block free tax return S. H&r block free tax return Possessions You can take either a credit or a deduction for income taxes paid to a foreign country or a U. H&r block free tax return S. H&r block free tax return possession. H&r block free tax return Taken as a deduction, foreign income taxes reduce your taxable income. H&r block free tax return Taken as a credit, foreign income taxes reduce your tax liability. H&r block free tax return You must treat all foreign income taxes the same way. H&r block free tax return If you take a credit for any foreign income taxes, you cannot deduct any foreign income taxes. H&r block free tax return However, you may be able to deduct other foreign taxes. H&r block free tax return See Deduction for Other Foreign Taxes, later. H&r block free tax return There is no rule to determine whether it is to your advantage to take a deduction or a credit for foreign income taxes. H&r block free tax return In most cases, it is to your advantage to take foreign income taxes as a tax credit, which you subtract directly from your U. H&r block free tax return S. H&r block free tax return tax liability, rather than as a deduction in figuring taxable income. H&r block free tax return However, if foreign income taxes were imposed at a high rate and the proportion of foreign income to U. H&r block free tax return S. H&r block free tax return income is small, a lower final tax may result from deducting the foreign income taxes. H&r block free tax return In any event, you should figure your tax liability both ways and then use the one that is better for you. H&r block free tax return You can make or change your choice within 10 years from the due date for filing the tax return on which you are entitled to take either the deduction or the credit. H&r block free tax return Foreign income taxes. H&r block free tax return   These are generally income taxes you pay to any foreign country or possession of the United States. H&r block free tax return Foreign income taxes on U. H&r block free tax return S. H&r block free tax return return. H&r block free tax return   Foreign income taxes can only be taken as a credit on Form 1040, line 47, or as an itemized deduction on Schedule A. H&r block free tax return These amounts cannot be included as withheld income taxes on Form 1040, line 62. H&r block free tax return Foreign taxes paid on excluded income. H&r block free tax return   You cannot take a credit or deduction for foreign income taxes paid on earnings you exclude from tax under any of the following. H&r block free tax return Foreign earned income exclusion. H&r block free tax return Foreign housing exclusion. H&r block free tax return Possession exclusion. H&r block free tax return If your wages are completely excluded, you cannot deduct or take a credit for any of the foreign taxes paid on your wages. H&r block free tax return   If only part of your wages is excluded, you cannot deduct or take a credit for the foreign income taxes allocable to the excluded part. H&r block free tax return You find the taxes allocable to your excluded wages by applying a fraction to the foreign taxes paid on foreign earned income received during the tax year. H&r block free tax return The numerator (top number) of the fraction is your excluded foreign earned income received during the tax year minus deductible expenses allocable to that income (not including the foreign housing deduction). H&r block free tax return The denominator (bottom number) of the fraction is your total foreign earned income received during the tax year minus all deductible expenses allocable to that income (including the foreign housing deduction). H&r block free tax return   If foreign law taxes both earned income and some other type of income and the taxes on the other type cannot be separated, the denominator of the fraction is the total amount of income subject to foreign tax minus deductible expenses allocable to that income. H&r block free tax return    If you take a foreign tax credit for tax on income you could have excluded under your choice to exclude foreign earned income or your choice to exclude foreign housing costs, one or both of the choices may be considered revoked. H&r block free tax return Credit for Foreign Income Taxes If you take the foreign tax credit, you may have to file Form 1116 with Form 1040. H&r block free tax return Form 1116 is used to figure the amount of foreign tax paid or accrued that can be claimed as a foreign tax credit. H&r block free tax return Do not include the amount of foreign tax paid or accrued as withheld federal income taxes on Form 1040, line 62. H&r block free tax return The foreign income tax for which you can claim a credit is the amount of legal and actual tax liability you pay or accrue during the year. H&r block free tax return The amount for which you can claim a credit is not necessarily the amount withheld by the foreign country. H&r block free tax return You cannot take a foreign tax credit for income tax you paid to a foreign country that would be refunded by the foreign country if you made a claim for refund. H&r block free tax return Subsidies. H&r block free tax return   If a foreign country returns your foreign tax payments to you in the form of a subsidy, you cannot claim a foreign tax credit based on these payments. H&r block free tax return This rule applies to a subsidy provided by any means that is determined, directly or indirectly, by reference to the amount of tax, or to the base used to figure the tax. H&r block free tax return   Some ways of providing a subsidy are refunds, credits, deductions, payments, or discharges of obligations. H&r block free tax return A credit is also not allowed if the subsidy is given to a person related to you, or persons who participated in a transaction or a related transaction with you. H&r block free tax return Limit The foreign tax credit is limited to the part of your total U. H&r block free tax return S. H&r block free tax return tax that is in proportion to your taxable income from sources outside the United States compared to your total taxable income. H&r block free tax return The allowable foreign tax credit cannot be more than your actual foreign tax liability. H&r block free tax return Exemption from limit. H&r block free tax return   You will not be subject to this limit and will not have to file Form 1116 if you meet all three of the following requirements. H&r block free tax return Your only foreign source income for the year is passive income (dividends, interest, royalties, etc. H&r block free tax return ) that is reported to you on a payee statement (such as a Form 1099-DIV or 1099-INT). H&r block free tax return Your foreign taxes for the year that qualify for the credit are not more than $300 ($600 if you are filing a joint return) and are reported on a payee statement. H&r block free tax return You elect this procedure. H&r block free tax return If you make this election, you cannot carry back or carry over any unused foreign tax to or from this year. H&r block free tax return Separate limit. H&r block free tax return   You must figure the limit on a separate basis with regard to “passive category income” and “general category income” (see the instructions for Form 1116). H&r block free tax return Figuring the limit. H&r block free tax return   In figuring taxable income in each category, you take into account only the amount that you must include in income on your federal tax return. H&r block free tax return Do not take any excluded amount into account. H&r block free tax return   To determine your taxable income in each category, deduct expenses and losses that are definitely related to that income. H&r block free tax return   Other expenses (such as itemized deductions or the standard deduction) not definitely related to specific items of income must be apportioned to the foreign income in each category by multiplying them by a fraction. H&r block free tax return The numerator (top number) of the fraction is your gross foreign income in the separate limit category. H&r block free tax return The denominator (bottom number) of the fraction is your gross income from all sources. H&r block free tax return For this purpose, gross income includes income that is excluded under the foreign earned income provisions but does not include any other exempt income. H&r block free tax return You must use special rules for deducting interest expenses. H&r block free tax return For more information on allocating and apportioning your deductions, see Publication 514. H&r block free tax return Exemptions. H&r block free tax return   Do not take the deduction for exemptions for yourself, your spouse, or your dependents in figuring taxable income for purposes of the limit. H&r block free tax return Recapture of foreign losses. H&r block free tax return   If you have an overall foreign loss and the loss reduces your U. H&r block free tax return S. H&r block free tax return source income (resulting in a reduction of your U. H&r block free tax return S. H&r block free tax return tax liability), you must recapture the loss in later years when you have taxable income from foreign sources. H&r block free tax return This is done by treating a part of your taxable income from foreign sources in later years as U. H&r block free tax return S. H&r block free tax return source income. H&r block free tax return This reduces the numerator of the limiting fraction and the resulting foreign tax credit limit. H&r block free tax return Recapture of domestic losses. H&r block free tax return   If you have an overall domestic loss (resulting in no U. H&r block free tax return S. H&r block free tax return tax liability), you cannot claim a foreign tax credit for taxes paid during that year. H&r block free tax return You must recapture the loss in later years when you have U. H&r block free tax return S. H&r block free tax return source taxable income. H&r block free tax return This is done by treating a part of your taxable income from U. H&r block free tax return S. H&r block free tax return sources in later years as foreign source income. H&r block free tax return This increases the numerator of the limiting fraction and the resulting foreign tax credit limit. H&r block free tax return Foreign tax credit carryback and carryover. H&r block free tax return   The amount of foreign income tax not allowed as a credit because of the limit can be carried back 1 year and carried forward 10 years. H&r block free tax return   More information on figuring the foreign tax credit can be found in Publication 514. H&r block free tax return Deduction for Foreign Income Taxes Instead of taking the foreign tax credit, you can deduct foreign income taxes as an itemized deduction on Schedule A (Form 1040). H&r block free tax return You can deduct only foreign income taxes paid on income that is subject to U. H&r block free tax return S. H&r block free tax return tax. H&r block free tax return You cannot deduct foreign taxes paid on earnings you exclude from tax under any of the following. H&r block free tax return Foreign earned income exclusion. H&r block free tax return Foreign housing exclusion. H&r block free tax return Possession exclusion. H&r block free tax return Example. H&r block free tax return You are a U. H&r block free tax return S. H&r block free tax return citizen and qualify to exclude your foreign earned income. H&r block free tax return Your excluded wages in Country X are $70,000 on which you paid income tax of $10,000. H&r block free tax return You received dividends from Country X of $2,000 on which you paid income tax of $600. H&r block free tax return You can deduct the $600 tax payment because the dividends relating to it are subject to U. H&r block free tax return S. H&r block free tax return tax. H&r block free tax return Because you exclude your wages, you cannot deduct the income tax of $10,000. H&r block free tax return If you exclude only a part of your wages, see the earlier discussion under Foreign taxes paid on excluded income. H&r block free tax return Deduction for Other Foreign Taxes You can deduct real property taxes you pay that are imposed on you by a foreign country. H&r block free tax return You take this deduction on Schedule A (Form 1040). H&r block free tax return You cannot deduct other foreign taxes, such as personal property taxes, unless you incurred the expenses in a trade or business or in the production of income. H&r block free tax return On the other hand, you generally can deduct personal property taxes when you pay them to U. H&r block free tax return S. H&r block free tax return possessions. H&r block free tax return But if you claim the possession exclusion, see Publication 570. H&r block free tax return The deduction for foreign taxes other than foreign income taxes is not related to the foreign tax credit. H&r block free tax return You can take deductions for these miscellaneous foreign taxes and also claim the foreign tax credit for income taxes imposed by a foreign country. H&r block free tax return How To Report Deductions If you exclude foreign earned income or housing amounts, how you show your deductions on your tax return and how you figure the amount allocable to your excluded income depends on whether the expenses are used in figuring adjusted gross income (Form 1040, line 38) or are itemized deductions. H&r block free tax return If you have deductions used in figuring adjusted gross income, enter the total amount for each of these items on the appropriate lines and schedules of Form 1040. H&r block free tax return Generally, you figure the amount of a deduction related to the excluded income by multiplying the deduction by a fraction, the numerator of which is your foreign earned income exclusion and the denominator of which is your foreign earned income. H&r block free tax return Enter the amount of the deduction(s) related to excluded income on line 44 of Form 2555. H&r block free tax return If you have itemized deductions related to excluded income, enter on Schedule A (Form 1040) only the part not related to excluded income. H&r block free tax return You figure that amount by subtracting from the total deduction the amount related to excluded income. H&r block free tax return Generally, you figure the amount that is related to the excluded income by multiplying the total deduction by a fraction, the numerator of which is your foreign earned income exclusion and the denominator of which is your foreign earned income. H&r block free tax return Attach a statement to your return showing how you figured the deductible amount. H&r block free tax return Example 1. H&r block free tax return You are a U. H&r block free tax return S. H&r block free tax return citizen employed as an accountant. H&r block free tax return Your tax home is in Germany for the entire tax year. H&r block free tax return You meet the physical presence test. H&r block free tax return Your foreign earned income for the year was $122,000 and your investment income was $10,380. H&r block free tax return After excluding $97,600, your AGI is $34,780. H&r block free tax return You had unreimbursed business expenses of $2,500 for travel and entertainment in earning your foreign income, of which $500 was for meals and entertainment. H&r block free tax return These expenses are deductible only as miscellaneous deductions on Schedule A (Form 1040). H&r block free tax return You also have $500 of miscellaneous expenses that are not related to your foreign income that you enter on line 23 of Schedule A. H&r block free tax return You must fill out Form 2106. H&r block free tax return On that form, reduce your deductible meal and entertainment expenses by 50% ($250). H&r block free tax return You must reduce the remaining $2,250 of travel and entertainment expenses by 80% ($1,800) because you excluded 80% ($97,600/$122,000) of your foreign earned income. H&r block free tax return You carry the remaining total of $450 to line 21 of Schedule A. H&r block free tax return Add the $450 to the $500 that you have on line 23 and enter the total ($950) on line 24. H&r block free tax return On line 26 of Schedule A, enter $696, which is 2% of your adjusted gross income of $34,780 (line 38, Form 1040) and subtract it from the amount on line 24. H&r block free tax return Enter $254 on line 27 of Schedule A. H&r block free tax return Example 2. H&r block free tax return You are a U. H&r block free tax return S. H&r block free tax return citizen, have a tax home in Spain, and meet the physical presence test. H&r block free tax return You are self-employed and personal services produce the business income. H&r block free tax return Your gross income was $116,931, business expenses $66,895, and net income (profit) $50,036. H&r block free tax return You choose the foreign earned income exclusion and exclude $97,600 of your gross income. H&r block free tax return Since your excluded income is 83. H&r block free tax return 47% of your total income, 83. H&r block free tax return 47% of your business expenses are not deductible. H&r block free tax return Report your total income and expenses on Schedule C (Form 1040). H&r block free tax return On Form 2555 you will show the following: Line 20a, $116,931, gross income, Lines 42 and 43, $97,600, foreign earned income exclusion, and Line 44, $55,837 (83. H&r block free tax return 47% × $66,895) business expenses attributable to the exclusion. H&r block free tax return In this situation (Example 2), you cannot use Form 2555-EZ since you had self-employment income and business expenses. H&r block free tax return Example 3. H&r block free tax return Assume in Example 2 that both capital and personal services combine to produce the business income. H&r block free tax return No more than 30% of your net income, or $15,011, assuming that this amount is a reasonable allowance for your services, is considered earned and can be excluded. H&r block free tax return Your exclusion of $15,011 is 12. H&r block free tax return 84% of your gross income ($15,011 ÷ $116,931). H&r block free tax return Because you excluded 12. H&r block free tax return 84% of your total income, $8,589 (. H&r block free tax return 1284 x $66,895) of your business expenses is attributable to the excluded income and is not deductible. H&r block free tax return Example 4. H&r block free tax return You are a U. H&r block free tax return S. H&r block free tax return citizen, have a tax home in Brazil, and meet the physical presence test. H&r block free tax return You are self-employed and both capital and personal services combine to produce business income. H&r block free tax return Your gross income was $146,000, business expenses were $172,000, and your net loss was $26,000. H&r block free tax return A reasonable allowance for the services you performed for the business is $77,000. H&r block free tax return Because you incurred a net loss, the earned income limit of 30% of your net profit does not apply. H&r block free tax return The $77,000 is foreign earned income. H&r block free tax return If you choose to exclude the $77,000, you exclude 52. H&r block free tax return 74% of your gross income ($77,000 ÷ $146,000), and 52. H&r block free tax return 74% of your business expenses ($90,713) is attributable to that income and is not deductible. H&r block free tax return Show your total income and expenses on Schedule C (Form 1040). H&r block free tax return On Form 2555, exclude $77,000 and show $90,713 on line 44. H&r block free tax return Subtract line 44 from line 43, and enter the difference as a negative (in parentheses) on line 45. H&r block free tax return Because this amount is negative, enter it as a positive (no parentheses) on line 21, Form 1040, and combine it with your other income to arrive at total income on line 22 of Form 1040. H&r block free tax return In this situation (Example 4), you would probably not want to choose the foreign earned income exclusion if this was the first year you were eligible. H&r block free tax return If you had chosen the exclusion in an earlier year, you might want to revoke the choice for this year. H&r block free tax return To do so would mean that you could not claim the exclusion again for the next 5 tax years without IRS approval. H&r block free tax return See Choosing the Exclusion in chapter 4. H&r block free tax return Example 5. H&r block free tax return You are a U. H&r block free tax return S. H&r block free tax return citizen, have a tax home in Panama, and meet the bona fide residence test. H&r block free tax return You have been performing services for clients as a partner in a firm that provides services exclusively in Panama. H&r block free tax return Capital investment is not material in producing the partnership's income. H&r block free tax return Under the terms of the partnership agreement, you are to receive 50% of the net profits. H&r block free tax return The partnership received gross income of $244,000 and incurred operating expenses of $98,250. H&r block free tax return Of the net profits of $145,750, you received $72,875 as your distributive share. H&r block free tax return You choose to exclude $97,600 of your share of the gross income. H&r block free tax return Because you exclude 80% ($97,600 ÷ $122,000) of your share of the gross income, you cannot deduct $39,300, 80% of your share of the operating expenses (. H&r block free tax return 80 × $49,125). H&r block free tax return Report $72,875, your distributive share of the partnership net profit, on Schedule E (Form 1040), Supplemental Income and Loss. H&r block free tax return On Form 2555, show $97,600 on line 42 and show $39,300 on line 44. H&r block free tax return Your exclusion on Form 2555 is $58,300. H&r block free tax return In this situation (Example 5), you cannot use Form 2555-EZ since you had earned income other than salaries and wages and you had business expenses. H&r block free tax return Prev  Up  Next   Home   More Online Publications
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The H&r Block Free Tax Return

H&r block free tax return Publication 915 - Main Content Table of Contents Are Any of Your Benefits Taxable?Worksheet A. H&r block free tax return Exemption from withholding. H&r block free tax return How To Report Your Benefits How Much Is Taxable?Examples Lump-Sum ElectionExample Deductions Related to Your BenefitsRepayments More Than Gross Benefits Worksheets AppendixForm SSA-1099, Social Security Benefit Statement 2013 Form SSA-1042S, Social Security Benefit Statement 2013 (Nonresident Aliens) Form RRB-1099, Payments by the Railroad Retirement Board 2013 Form RRB-1042S, Payments by the Railroad Retirement Board 2013 (Nonresident Aliens) How To Get Tax HelpLow Income Taxpayer Clinics Are Any of Your Benefits Taxable? To find out whether any of your benefits shown on Forms SSA-1099 and RRB-1099 may be taxable, compare the base amount (explained later) for your filing status with the total of: One-half of your benefits, plus All your other income, including tax-exempt interest. H&r block free tax return When making this comparison, do not reduce your other income by any exclusions for: Interest from qualified U. H&r block free tax return S. H&r block free tax return savings bonds, Employer-provided adoption benefits, Foreign earned income or foreign housing, or Income earned by bona fide residents of American Samoa or Puerto Rico. H&r block free tax return Children's benefits. H&r block free tax return   The rules in this publication apply to benefits received by children. H&r block free tax return See Who is taxed , later. H&r block free tax return The SSA issues Form SSA-1099 and Form SSA-1042S. H&r block free tax return The RRB issues Form RRB-1099 and Form RRB-1042S. H&r block free tax return These forms (tax statements) report the amounts paid and repaid, and taxes withheld for a tax year. H&r block free tax return You may receive more than one of these forms for the same tax year. H&r block free tax return See the Appendix at the end of this publication for more information. H&r block free tax return Each original Form RRB-1099 or Form RRB-1042S is valid unless it has been corrected. H&r block free tax return The RRB will issue a corrected Form RRB-1099 or Form RRB-1042S if there is an error in the original. H&r block free tax return A corrected Form RRB-1099 or Form RRB-1042S is indicated as “CORRECTED” and replaces the corresponding original Form RRB-1099 or Form RRB-1042S. H&r block free tax return You must use the latest corrected Form RRB-1099 or Form RRB-1042S you received and any original Form RRB-1099 or Form RRB-1042S that the RRB has not corrected when you determine what amounts to report on your tax return. H&r block free tax return Figuring total income. H&r block free tax return   To figure the total of one-half of your benefits plus your other income, use Worksheet A, discussed later. H&r block free tax return If the total is more than your base amount, part of your benefits may be taxable. H&r block free tax return   If you are married and file a joint return for 2013, you and your spouse must combine your incomes and your benefits to figure whether any of your combined benefits are taxable. H&r block free tax return Even if your spouse did not receive any benefits, you must add your spouse's income to yours to figure whether any of your benefits are taxable. H&r block free tax return If the only income you received during 2013 was your social security or the SSEB portion of tier 1 railroad retirement benefits, your benefits generally are not taxable and you probably do not have to file a return. H&r block free tax return If you have income in addition to your benefits, you may have to file a return even if none of your benefits are taxable. H&r block free tax return Base amount. H&r block free tax return   Your base amount is: $25,000 if you are single, head of household, or qualifying widow(er), $25,000 if you are married filing separately and lived apart from your spouse for all of 2013, $32,000 if you are married filing jointly, or $-0- if you are married filing separately and lived with your spouse at any time during 2013. H&r block free tax return Worksheet A. H&r block free tax return   You can use Worksheet A to figure the amount of income to compare with your base amount. H&r block free tax return This is a quick way to check whether some of your benefits may be taxable. H&r block free tax return     Worksheet A. H&r block free tax return A Quick Way To Check if Your Benefits May Be Taxable Keep for your records A. H&r block free tax return Enter the amount from box 5 of all your Forms SSA-1099 and RRB-1099. H&r block free tax return Include the full amount of any lump-sum benefit payments received in 2013, for 2013 and earlier years. H&r block free tax return (If you received more than one form, combine the amounts from box 5 and enter the total. H&r block free tax return ) A. H&r block free tax return   Note. H&r block free tax return If the amount on line A is zero or less, stop here; none of your benefits are taxable this year. H&r block free tax return B. H&r block free tax return Enter one-half of the amount on line A B. H&r block free tax return   C. H&r block free tax return Enter your taxable pensions, wages, interest, dividends, and other taxable income C. H&r block free tax return   D. H&r block free tax return Enter any tax-exempt interest income (such as interest on municipal bonds) plus any exclusions from income (listed earlier) D. H&r block free tax return   E. H&r block free tax return Add lines B, C, and D E. H&r block free tax return   Note. H&r block free tax return Compare the amount on line E to your base amount for your filing status. H&r block free tax return If the amount on line E equals or is less than the base amount for your filing status, none of your benefits are taxable this year. H&r block free tax return If the amount on line E is more than your base amount, some of your benefits may be taxable. H&r block free tax return You need to complete Worksheet 1, shown later. H&r block free tax return If none of your benefits are taxable, but you otherwise must file a tax return, see Benefits not taxable , later, under How To Report Your Benefits . H&r block free tax return   Example. H&r block free tax return You and your spouse (both over 65) are filing a joint return for 2013 and you both received social security benefits during the year. H&r block free tax return In January 2014, you received a Form SSA-1099 showing net benefits of $7,500 in box 5. H&r block free tax return Your spouse received a Form SSA-1099 showing net benefits of $3,500 in box 5. H&r block free tax return You also received a taxable pension of $22,800 and interest income of $500. H&r block free tax return You did not have any tax-exempt interest income. H&r block free tax return Your benefits are not taxable for 2013 because your income, as figured in Worksheet A below, is not more than your base amount ($32,000) for married filing jointly. H&r block free tax return   Even though none of your benefits are taxable, you must file a return for 2013 because your taxable gross income ($23,300) exceeds the minimum filing requirement amount for your filing status. H&r block free tax return     Filled-in Worksheet A. H&r block free tax return A Quick Way To Check if Your Benefits May Be Taxable Keep for your records A. H&r block free tax return Enter the amount from box 5 of all your Forms SSA-1099 and RRB-1099. H&r block free tax return Include the full amount of any lump-sum benefit payments received in 2013, for 2013 and earlier years. H&r block free tax return (If you received more than one form, combine the amounts from box 5 and enter the total. H&r block free tax return ) A. H&r block free tax return $11,000 Note. H&r block free tax return If the amount on line A is zero or less, stop here; none of your benefits are taxable this year. H&r block free tax return B. H&r block free tax return Enter one-half of the amount on line A B. H&r block free tax return 5,500 C. H&r block free tax return Enter your taxable pensions, wages, interest, dividends, and other taxable income C. H&r block free tax return 23,300 D. H&r block free tax return Enter any tax-exempt interest income (such as interest on municipal bonds) plus any exclusions from income (listed earlier) D. H&r block free tax return -0- E. H&r block free tax return Add lines B, C, and D E. H&r block free tax return $28,800 Note. H&r block free tax return Compare the amount on line E to your base amount for your filing status. H&r block free tax return If the amount on line E equals or is less than the base amount for your filing status, none of your benefits are taxable this year. H&r block free tax return If the amount on line E is more than your base amount, some of your benefits may be taxable. H&r block free tax return You need to complete Worksheet 1, shown later. H&r block free tax return If none of your benefits are taxable, but you otherwise must file a tax return, see Benefits not taxable , later, under How To Report Your Benefits . H&r block free tax return   Who is taxed. H&r block free tax return   Benefits are included in the taxable income (to the extent they are taxable) of the person who has the legal right to receive the benefits. H&r block free tax return For example, if you and your child receive benefits, but the check for your child is made out in your name, you must use only your part of the benefits to see whether any benefits are taxable to you. H&r block free tax return One-half of the part that belongs to your child must be added to your child's other income to see whether any of those benefits are taxable to your child. H&r block free tax return Repayment of benefits. H&r block free tax return   Any repayment of benefits you made during 2013 must be subtracted from the gross benefits you received in 2013. H&r block free tax return It does not matter whether the repayment was for a benefit you received in 2013 or in an earlier year. H&r block free tax return If you repaid more than the gross benefits you received in 2013, see Repayments More Than Gross Benefits , later. H&r block free tax return   Your gross benefits are shown in box 3 of Form SSA-1099 or Form RRB-1099. H&r block free tax return Your repayments are shown in box 4. H&r block free tax return The amount in box 5 shows your net benefits for 2013 (box 3 minus box 4). H&r block free tax return Use the amount in box 5 to figure whether any of your benefits are taxable. H&r block free tax return Example. H&r block free tax return In 2012, you received $3,000 in social security benefits, and in 2013 you received $2,700. H&r block free tax return In March 2013, SSA notified you that you should have received only $2,500 in benefits in 2012. H&r block free tax return During 2013, you repaid $500 to SSA. H&r block free tax return The Form SSA-1099 you received for 2013 shows $2,700 in box 3 (gross amount) and $500 in box 4 (repayment). H&r block free tax return The amount in box 5 shows your net benefits of $2,200 ($2,700 minus $500). H&r block free tax return Tax withholding and estimated tax. H&r block free tax return   You can choose to have federal income tax withheld from your social security benefits and/or the SSEB portion of your tier 1 railroad retirement benefits. H&r block free tax return If you choose to do this, you must complete a Form W-4V, Voluntary Withholding Statement. H&r block free tax return   If you do not choose to have income tax withheld, you may have to request additional withholding from other income or pay estimated tax during the year. H&r block free tax return For details, see Publication 505, Tax Withholding and Estimated Tax, or the instructions for Form 1040-ES, Estimated Tax for Individuals. H&r block free tax return U. H&r block free tax return S. H&r block free tax return citizens residing abroad. H&r block free tax return   U. H&r block free tax return S. H&r block free tax return citizens who are residents of the following countries are exempt from U. H&r block free tax return S. H&r block free tax return tax on their benefits. H&r block free tax return Canada. H&r block free tax return Egypt. H&r block free tax return Germany. H&r block free tax return Ireland. H&r block free tax return Israel. H&r block free tax return Italy. H&r block free tax return (You must also be a citizen of Italy for the exemption to apply. H&r block free tax return ) Romania. H&r block free tax return United Kingdom. H&r block free tax return   The SSA will not withhold U. H&r block free tax return S. H&r block free tax return tax from your benefits if you are a U. H&r block free tax return S. H&r block free tax return citizen. H&r block free tax return   The RRB will withhold U. H&r block free tax return S. H&r block free tax return tax from your benefits unless you file Form RRB-1001, Nonresident Questionnaire, with the RRB to provide citizenship and residency information. H&r block free tax return If you do not file Form RRB-1001, the RRB will consider you a nonresident alien and withhold tax from your railroad retirement benefits at a 30% rate. H&r block free tax return Contact the RRB to get this form. H&r block free tax return Lawful permanent residents. H&r block free tax return   For U. H&r block free tax return S. H&r block free tax return income tax purposes, lawful permanent residents (green card holders) are considered resident aliens until their lawful permanent resident status under the immigration laws is either taken away or is administratively or judicially determined to have been abandoned. H&r block free tax return Social security benefits paid to a green card holder are not subject to 30% withholding. H&r block free tax return If you are a green card holder and tax was withheld in error on your social security benefits because you have a foreign address, the withholding tax is refundable by the Social Security Administration (SSA) or the IRS. H&r block free tax return SSA will refund taxes erroneously withheld if the refund can be processed during the same calendar year in which the tax was withheld. H&r block free tax return If SSA cannot refund the taxes withheld, you must file a Form 1040 or 1040A with the Internal Revenue Service Center, Austin, TX 73301 to determine if you are entitled to a refund. H&r block free tax return You must also attach the following information to your Form 1040 or 1040A: A copy of the Form SSA-1042S, Social Security Benefit Statement, A copy of the “green card,” and A signed declaration that includes the following statements:    “The SSA should not have withheld federal income tax from my social security benefits because I am a U. H&r block free tax return S. H&r block free tax return lawful permanent resident and my green card has been neither revoked nor administratively or judicially determined to have been abandoned. H&r block free tax return I am filing a U. H&r block free tax return S. H&r block free tax return income tax return for the tax year as a resident alien reporting all of my worldwide income. H&r block free tax return I have not claimed benefits for the tax year under an income tax treaty as a nonresident alien. H&r block free tax return ” Nonresident aliens. H&r block free tax return   A nonresident alien is an individual who is not a citizen or resident of the United States. H&r block free tax return If you are a nonresident alien, the rules discussed in this publication do not apply to you. H&r block free tax return Instead, 85% of your benefits are taxed at a 30% rate, unless exempt (or subject to a lower rate) by treaty. H&r block free tax return You will receive a Form SSA-1042S or Form RRB-1042S showing the amount of your benefits. H&r block free tax return These forms will also show the tax rate and the amount of tax withheld from your benefits. H&r block free tax return   Under tax treaties with the following countries, residents of these countries are exempt from U. H&r block free tax return S. H&r block free tax return tax on their benefits. H&r block free tax return Canada. H&r block free tax return Egypt. H&r block free tax return Germany. H&r block free tax return Ireland. H&r block free tax return Israel. H&r block free tax return Italy. H&r block free tax return Japan. H&r block free tax return Romania. H&r block free tax return United Kingdom. H&r block free tax return   Under a treaty with India, benefits paid to individuals who are both residents and nationals of India are exempt from U. H&r block free tax return S. H&r block free tax return tax if the benefits are for services performed for the United States, its subdivisions, or local government authorities. H&r block free tax return   If you are a resident of Switzerland, your total benefit amount will be taxed at a 15% rate. H&r block free tax return   For more information on whether you are a nonresident alien, see Publication 519, U. H&r block free tax return S. H&r block free tax return Tax Guide for Aliens. H&r block free tax return Exemption from withholding. H&r block free tax return   If your social security benefits are exempt from tax because you are a resident of one of the treaty countries listed, the SSA will not withhold U. H&r block free tax return S. H&r block free tax return tax from your benefits. H&r block free tax return   If your railroad retirement benefits are exempt from tax because you are a resident of one of the treaty countries listed, you can claim an exemption from withholding by filing Form RRB-1001 with the RRB. H&r block free tax return Contact the RRB to get this form. H&r block free tax return Canadian or German social security benefits paid to U. H&r block free tax return S. H&r block free tax return residents. H&r block free tax return   Under income tax treaties with Canada and Germany, social security benefits paid by those countries to U. H&r block free tax return S. H&r block free tax return residents are treated for U. H&r block free tax return S. H&r block free tax return income tax purposes as if they were paid under the social security legislation of the United States. H&r block free tax return If you receive social security benefits from Canada or Germany, include them on line 1 of Worksheet 1, shown later. H&r block free tax return How To Report Your Benefits If part of your benefits are taxable, you must use Form 1040 or Form 1040A. H&r block free tax return You cannot use Form 1040EZ. H&r block free tax return Reporting on Form 1040. H&r block free tax return   Report your net benefits (the total amount from box 5 of all your Forms SSA-1099 and Forms RRB-1099) on line 20a and the taxable part on line 20b. H&r block free tax return If you are married filing separately and you lived apart from your spouse for all of 2013, also enter “D” to the right of the word “benefits” on line 20a. H&r block free tax return Reporting on Form 1040A. H&r block free tax return   Report your net benefits (the total amount from box 5 of all your Forms SSA-1099 and Forms RRB-1099) on line 14a and the taxable part on line 14b. H&r block free tax return If you are married filing separately and you lived apart from your spouse for all of 2013, also enter “D” to the right of the word “benefits” on line 14a. H&r block free tax return Benefits not taxable. H&r block free tax return   If you are filing Form 1040EZ, do not report any benefits on your tax return. H&r block free tax return If you are filing Form 1040 or Form 1040A, report your net benefits (the total amount from box 5 of all your Forms SSA-1099 and Forms RRB-1099) on Form 1040, line 20a, or Form 1040A, line 14a. H&r block free tax return Enter -0- on Form 1040, line 20b, or Form 1040A, line 14b. H&r block free tax return If you are married filing separately and you lived apart from your spouse for all of 2013, also enter “D” to the right of the word “benefits” on Form 1040, line 20a, or Form 1040A, line 14a. H&r block free tax return How Much Is Taxable? If part of your benefits are taxable, how much is taxable depends on the total amount of your benefits and other income. H&r block free tax return Generally, the higher that total amount, the greater the taxable part of your benefits. H&r block free tax return Maximum taxable part. H&r block free tax return   Generally, up to 50% of your benefits will be taxable. H&r block free tax return However, up to 85% of your benefits can be taxable if either of the following situations applies to you. H&r block free tax return The total of one-half of your benefits and all your other income is more than $34,000 ($44,000 if you are married filing jointly). H&r block free tax return You are married filing separately and lived with your spouse at any time during 2013. H&r block free tax return Which worksheet to use. H&r block free tax return   A worksheet you can use to figure your taxable benefits is in the instructions for your Form 1040 or 1040A. H&r block free tax return You can use either that worksheet or Worksheet 1 in this publication, unless any of the following situations applies to you. H&r block free tax return You contributed to a traditional individual retirement arrangement (IRA) and you or your spouse is covered by a retirement plan at work. H&r block free tax return In this situation you must use the special worksheets in Appendix B of Publication 590 to figure both your IRA deduction and your taxable benefits. H&r block free tax return Situation (1) does not apply and you take an exclusion for interest from qualified U. H&r block free tax return S. H&r block free tax return savings bonds (Form 8815), for adoption benefits (Form 8839), for foreign earned income or housing (Form 2555 or Form 2555-EZ), or for income earned in American Samoa (Form 4563) or Puerto Rico by bona fide residents. H&r block free tax return In this situation, you must use Worksheet 1 in this publication to figure your taxable benefits. H&r block free tax return You received a lump-sum payment for an earlier year. H&r block free tax return In this situation, also complete Worksheet 2 or 3 and Worksheet 4 in this publication. H&r block free tax return See Lump-Sum Election , later. H&r block free tax return Examples A few examples you can use as a guide to figure the taxable part of your benefits follow. H&r block free tax return Filled-in Worksheet 1. H&r block free tax return Figuring Your Taxable Benefits Before you begin: If you are married filing separately and you lived apart from your spouse for all of 2013, enter “D” to the right of the word “benefits” on Form 1040, line 20a, or Form 1040A, line 14a. H&r block free tax return Do not use this worksheet if you repaid benefits in 2013 and your total repayments (box 4 of Forms SSA-1099 and RRB-1099) were more than your gross benefits for 2013 (box 3 of Forms SSA-1099 and RRB-1099). H&r block free tax return None of your benefits are taxable for 2013. H&r block free tax return For more information, see Repayments More Than Gross Benefits . H&r block free tax return If you are filing Form 8815, Exclusion of Interest From Series EE and I U. H&r block free tax return S. H&r block free tax return Savings Bonds Issued After 1989, do not include the amount from line 8a of Form 1040 or Form 1040A on line 3 of this worksheet. H&r block free tax return Instead, include the amount from Schedule B (Form 1040A or 1040), line 2. H&r block free tax return 1. H&r block free tax return Enter the total amount from box 5 of ALL your Forms SSA-1099 and RRB-1099. H&r block free tax return Also enter this amount on Form 1040, line 20a, or Form 1040A, line 14a 1. H&r block free tax return $5,980         2. H&r block free tax return Enter one-half of line 1 2. H&r block free tax return 2,990     3. H&r block free tax return Combine the amounts from: Form 1040: Lines 7, 8a, 9a, 10 through 14, 15b, 16b, 17 through 19, and 21 Form 1040A: Lines 7, 8a, 9a, 10, 11b, 12b, and 13 3. H&r block free tax return 28,990     4. H&r block free tax return Enter the amount, if any, from Form 1040 or 1040A, line 8b 4. H&r block free tax return -0-     5. H&r block free tax return Enter the total of any exclusions/adjustments for: Adoption benefits (Form 8839, line 28), Foreign earned income or housing (Form 2555, lines 45 and 50, or Form 2555-EZ, line 18), and Certain income of bona fide residents of American Samoa (Form 4563, line 15) or Puerto Rico 5. H&r block free tax return -0-     6. H&r block free tax return Combine lines 2, 3, 4, and 5 6. H&r block free tax return 31,980     7. H&r block free tax return Form 1040 filers: Enter the amounts from Form 1040, lines 23 through 32, and any write-in adjustments you entered on the dotted line next to line 36. H&r block free tax return  Form 1040A filers: Enter the amounts from Form 1040A, lines 16 and 17 7. H&r block free tax return -0-     8. H&r block free tax return Is the amount on line 7 less than the amount on line 6?             No. H&r block free tax return None of your social security benefits are taxable. H&r block free tax return Enter -0- on Form 1040, line 20b, or Form 1040A, line 14b. H&r block free tax return             Yes. H&r block free tax return Subtract line 7 from line 6 8. H&r block free tax return 31,980     9. H&r block free tax return If you are:  Married filing jointly, enter $32,000 Single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013, enter $25,000 9. H&r block free tax return 25,000       Note. H&r block free tax return If you are married filing separately and you lived with your spouse at any time in 2013, skip lines 9 through 16; multiply line 8 by 85% (. H&r block free tax return 85) and enter the result on line 17. H&r block free tax return Then go to line 18. H&r block free tax return         10. H&r block free tax return Is the amount on line 9 less than the amount on line 8?             No. H&r block free tax return None of your benefits are taxable. H&r block free tax return Enter -0- on Form 1040, line 20b, or on Form 1040A, line 14b. H&r block free tax return If you are married filing separately and you lived apart from your spouse for all of 2013, be sure you entered “D” to the right of the word “benefits” on Form 1040, line 20a, or on Form 1040A, line 14a. H&r block free tax return             Yes. H&r block free tax return Subtract line 9 from line 8 10. H&r block free tax return 6,980     11. H&r block free tax return Enter $12,000 if married filing jointly; $9,000 if single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013 11. H&r block free tax return 9,000     12. H&r block free tax return Subtract line 11 from line 10. H&r block free tax return If zero or less, enter -0- 12. H&r block free tax return -0-     13. H&r block free tax return Enter the smaller of line 10 or line 11 13. H&r block free tax return 6,980     14. H&r block free tax return Enter one-half of line 13 14. H&r block free tax return 3,490     15. H&r block free tax return Enter the smaller of line 2 or line 14 15. H&r block free tax return 2,990     16. H&r block free tax return Multiply line 12 by 85% (. H&r block free tax return 85). H&r block free tax return If line 12 is zero, enter -0- 16. H&r block free tax return -0-     17. H&r block free tax return Add lines 15 and 16 17. H&r block free tax return 2,990     18. H&r block free tax return Multiply line 1 by 85% (. H&r block free tax return 85) 18. H&r block free tax return 5,083     19. H&r block free tax return Taxable benefits. H&r block free tax return Enter the smaller of line 17 or line 18. H&r block free tax return Also enter this amount on Form 1040, line 20b, or Form 1040A, line 14b 19. H&r block free tax return $2,990       If you received a lump-sum payment in 2013 that was for an earlier year, also complete Worksheet 2 or 3 and Worksheet 4 to see if you can report a lower taxable benefit. H&r block free tax return         Example 1. H&r block free tax return George White is single and files Form 1040 for 2013. H&r block free tax return In addition to receiving social security payments, he received a fully taxable pension of $18,600, wages from a part-time job of $9,400, and taxable interest income of $990, for a total of $28,990. H&r block free tax return He received a Form SSA-1099 in January 2014 that shows his net social security benefits of $5,980 in box 5. H&r block free tax return   To figure his taxable benefits, George completes Worksheet 1, shown below. H&r block free tax return On line 20a of his Form 1040, George enters his net benefits of $5,980. H&r block free tax return On line 20b, he enters his taxable benefits of $2,990. H&r block free tax return Example 2. H&r block free tax return Ray and Alice Hopkins file a joint return on Form 1040A for 2013. H&r block free tax return Ray is retired and received a fully taxable pension of $15,500. H&r block free tax return He also received social security benefits and his Form SSA-1099 for 2013 shows net benefits of $5,600 in box 5. H&r block free tax return Alice worked during the year and had wages of $14,000. H&r block free tax return She made a deductible payment to her IRA account of $1,000. H&r block free tax return Ray and Alice have two savings accounts with a total of $250 in taxable interest income. H&r block free tax return They complete Worksheet 1, entering $29,750 ($15,500 + $14,000 + $250) on line 3. H&r block free tax return They find none of Ray's social security benefits are taxable. H&r block free tax return On Form 1040A, they enter $5,600 on line 14a and -0- on line 14b. H&r block free tax return Filled-in Worksheet 1. H&r block free tax return Figuring Your Taxable Benefits Before you begin: If you are married filing separately and you lived apart from your spouse for all of 2013, enter “D” to the right of the word “benefits” on Form 1040, line 20a, or Form 1040A, line 14a. H&r block free tax return Do not use this worksheet if you repaid benefits in 2013 and your total repayments (box 4 of Forms SSA-1099 and RRB-1099) were more than your gross benefits for 2013 (box 3 of Forms SSA-1099 and RRB-1099). H&r block free tax return None of your benefits are taxable for 2013. H&r block free tax return For more information, see Repayments More Than Gross Benefits . H&r block free tax return If you are filing Form 8815, Exclusion of Interest From Series EE and I U. H&r block free tax return S. H&r block free tax return Savings Bonds Issued After 1989, do not include the amount from line 8a of Form 1040 or Form 1040A on line 3 of this worksheet. H&r block free tax return Instead, include the amount from Schedule B (Form 1040A or 1040), line 2. H&r block free tax return 1. H&r block free tax return Enter the total amount from box 5 of ALL your Forms SSA-1099 and RRB-1099. H&r block free tax return Also enter this amount on Form 1040, line 20a, or Form 1040A, line 14a 1. H&r block free tax return $5,600         2. H&r block free tax return Enter one-half of line 1 2. H&r block free tax return 2,800     3. H&r block free tax return Combine the amounts from: Form 1040: Lines 7, 8a, 9a, 10 through 14, 15b, 16b, 17 through 19, and 21 Form 1040A: Lines 7, 8a, 9a, 10, 11b, 12b, and 13 3. H&r block free tax return 29,750     4. H&r block free tax return Enter the amount, if any, from Form 1040 or 1040A, line 8b 4. H&r block free tax return -0-     5. H&r block free tax return Enter the total of any exclusions/adjustments for: Adoption benefits (Form 8839, line 28), Foreign earned income or housing (Form 2555, lines 45 and 50, or Form 2555-EZ, line 18), and Certain income of bona fide residents of American Samoa (Form 4563, line 15) or Puerto Rico 5. H&r block free tax return -0-     6. H&r block free tax return Combine lines 2, 3, 4, and 5 6. H&r block free tax return 32,550     7. H&r block free tax return Form 1040 filers: Enter the amounts from Form 1040, lines 23 through 32, and any write-in adjustments you entered on the dotted line next to line 36. H&r block free tax return  Form 1040A filers: Enter the amounts from Form 1040A, lines 16 and 17 7. H&r block free tax return 1,000     8. H&r block free tax return Is the amount on line 7 less than the amount on line 6?             No. H&r block free tax return None of your social security benefits are taxable. H&r block free tax return Enter -0- on Form 1040, line 20b, or Form 1040A, line 14b. H&r block free tax return             Yes. H&r block free tax return Subtract line 7 from line 6 8. H&r block free tax return 31,550     9. H&r block free tax return If you are:  Married filing jointly, enter $32,000 Single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013, enter $25,000 9. H&r block free tax return 32,000       Note. H&r block free tax return If you are married filing separately and you lived with your spouse at any time in 2013, skip lines 9 through 16; multiply line 8 by 85% (. H&r block free tax return 85) and enter the result on line 17. H&r block free tax return Then go to line 18. H&r block free tax return         10. H&r block free tax return Is the amount on line 9 less than the amount on line 8?             No. H&r block free tax return None of your benefits are taxable. H&r block free tax return Enter -0- on Form 1040, line 20b, or on Form 1040A, line 14b. H&r block free tax return If you are married filing separately and you lived apart from your spouse for all of 2013, be sure you entered “D” to the right of the word “benefits” on Form 1040, line 20a, or on Form 1040A, line 14a. H&r block free tax return             Yes. H&r block free tax return Subtract line 9 from line 8 10. H&r block free tax return       11. H&r block free tax return Enter $12,000 if married filing jointly; $9,000 if single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013 11. H&r block free tax return       12. H&r block free tax return Subtract line 11 from line 10. H&r block free tax return If zero or less, enter -0- 12. H&r block free tax return       13. H&r block free tax return Enter the smaller of line 10 or line 11 13. H&r block free tax return       14. H&r block free tax return Enter one-half of line 13 14. H&r block free tax return       15. H&r block free tax return Enter the smaller of line 2 or line 14 15. H&r block free tax return       16. H&r block free tax return Multiply line 12 by 85% (. H&r block free tax return 85). H&r block free tax return If line 12 is zero, enter -0- 16. H&r block free tax return       17. H&r block free tax return Add lines 15 and 16 17. H&r block free tax return       18. H&r block free tax return Multiply line 1 by 85% (. H&r block free tax return 85) 18. H&r block free tax return       19. H&r block free tax return Taxable benefits. H&r block free tax return Enter the smaller of line 17 or line 18. H&r block free tax return Also enter this amount on Form 1040, line 20b, or Form 1040A, line 14b 19. H&r block free tax return         If you received a lump-sum payment in 2013 that was for an earlier year, also complete Worksheet 2 or 3 and Worksheet 4 to see if you can report a lower taxable benefit. H&r block free tax return         Example 3. H&r block free tax return Joe and Betty Johnson file a joint return on Form 1040 for 2013. H&r block free tax return Joe is a retired railroad worker and in 2013 received the social security equivalent benefit (SSEB) portion of tier 1 railroad retirement benefits. H&r block free tax return Joe's Form RRB-1099 shows $10,000 in box 5. H&r block free tax return Betty is a retired government worker and received a fully taxable pension of $38,000. H&r block free tax return They had $2,300 in taxable interest income plus interest of $200 on a qualified U. H&r block free tax return S. H&r block free tax return savings bond. H&r block free tax return The savings bond interest qualified for the exclusion. H&r block free tax return They figure their taxable benefits by completing Worksheet 1 below. H&r block free tax return Because they have qualified U. H&r block free tax return S. H&r block free tax return savings bond interest, they follow the note at the beginning of the worksheet and use the amount from line 2 of their Schedule B (Form 1040A or 1040) on line 3 of the worksheet instead of the amount from line 8a of their Form 1040. H&r block free tax return On line 3 of the worksheet, they enter $40,500 ($38,000 + $2,500). H&r block free tax return More than 50% of Joe's net benefits are taxable because the income on line 8 of the worksheet ($45,500) is more than $44,000. H&r block free tax return (See Maximum taxable part under How Much Is Taxable earlier. H&r block free tax return ) Joe and Betty enter $10,000 on Form 1040, line 20a, and $6,275 on Form 1040, line 20b. H&r block free tax return Filled-in Worksheet 1. H&r block free tax return Figuring Your Taxable Benefits Before you begin: If you are married filing separately and you lived apart from your spouse for all of 2013, enter “D” to the right of the word “benefits” on Form 1040, line 20a, or Form 1040A, line 14a. H&r block free tax return Do not use this worksheet if you repaid benefits in 2013 and your total repayments (box 4 of Forms SSA-1099 and RRB-1099) were more than your gross benefits for 2013 (box 3 of Forms SSA-1099 and RRB-1099). H&r block free tax return None of your benefits are taxable for 2013. H&r block free tax return For more information, see Repayments More Than Gross Benefits . H&r block free tax return If you are filing Form 8815, Exclusion of Interest From Series EE and I U. H&r block free tax return S. H&r block free tax return Savings Bonds Issued After 1989, do not include the amount from line 8a of Form 1040 or Form 1040A on line 3 of this worksheet. H&r block free tax return Instead, include the amount from Schedule B (Form 1040A or 1040), line 2. H&r block free tax return 1. H&r block free tax return Enter the total amount from box 5 of ALL your Forms SSA-1099 and RRB-1099. H&r block free tax return Also enter this amount on Form 1040, line 20a, or Form 1040A, line 14a 1. H&r block free tax return $10,000         2. H&r block free tax return Enter one-half of line 1 2. H&r block free tax return 5,000     3. H&r block free tax return Combine the amounts from: Form 1040: Lines 7, 8a, 9a, 10 through 14, 15b, 16b, 17 through 19, and 21 Form 1040A: Lines 7, 8a, 9a, 10, 11b, 12b, and 13 3. H&r block free tax return 40,500     4. H&r block free tax return Enter the amount, if any, from Form 1040 or 1040A, line 8b 4. H&r block free tax return -0-     5. H&r block free tax return Enter the total of any exclusions/adjustments for: Adoption benefits (Form 8839, line 28), Foreign earned income or housing (Form 2555, lines 45 and 50, or Form 2555-EZ, line 18), and Certain income of bona fide residents of American Samoa (Form 4563, line 15) or Puerto Rico 5. H&r block free tax return -0-     6. H&r block free tax return Combine lines 2, 3, 4, and 5 6. H&r block free tax return 45,500     7. H&r block free tax return Form 1040 filers: Enter the amounts from Form 1040, lines 23 through 32, and any write-in adjustments you entered on the dotted line next to line 36. H&r block free tax return  Form 1040A filers: Enter the amounts from Form 1040A, lines 16 and 17 7. H&r block free tax return -0-     8. H&r block free tax return Is the amount on line 7 less than the amount on line 6?             No. H&r block free tax return None of your social security benefits are taxable. H&r block free tax return Enter -0- on Form 1040, line 20b, or Form 1040A, line 14b. H&r block free tax return             Yes. H&r block free tax return Subtract line 7 from line 6 8. H&r block free tax return 45,500     9. H&r block free tax return If you are:  Married filing jointly, enter $32,000 Single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013, enter $25,000 9. H&r block free tax return 32,000       Note. H&r block free tax return If you are married filing separately and you lived with your spouse at any time in 2013, skip lines 9 through 16; multiply line 8 by 85% (. H&r block free tax return 85) and enter the result on line 17. H&r block free tax return Then go to line 18. H&r block free tax return         10. H&r block free tax return Is the amount on line 9 less than the amount on line 8?             No. H&r block free tax return None of your benefits are taxable. H&r block free tax return Enter -0- on Form 1040, line 20b, or on Form 1040A, line 14b. H&r block free tax return If you are married filing separately and you lived apart from your spouse for all of 2013, be sure you entered “D” to the right of the word “benefits” on Form 1040, line 20a, or on Form 1040A, line 14a. H&r block free tax return             Yes. H&r block free tax return Subtract line 9 from line 8 10. H&r block free tax return 13,500     11. H&r block free tax return Enter $12,000 if married filing jointly; $9,000 if single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013 11. H&r block free tax return 12,000     12. H&r block free tax return Subtract line 11 from line 10. H&r block free tax return If zero or less, enter -0- 12. H&r block free tax return 1,500     13. H&r block free tax return Enter the smaller of line 10 or line 11 13. H&r block free tax return 12,000     14. H&r block free tax return Enter one-half of line 13 14. H&r block free tax return 6,000     15. H&r block free tax return Enter the smaller of line 2 or line 14 15. H&r block free tax return 5,000     16. H&r block free tax return Multiply line 12 by 85% (. H&r block free tax return 85). H&r block free tax return If line 12 is zero, enter -0- 16. H&r block free tax return 1,275     17. H&r block free tax return Add lines 15 and 16 17. H&r block free tax return 6,275     18. H&r block free tax return Multiply line 1 by 85% (. H&r block free tax return 85) 18. H&r block free tax return 8,500     19. H&r block free tax return Taxable benefits. H&r block free tax return Enter the smaller of line 17 or line 18. H&r block free tax return Also enter this amount on Form 1040, line 20b, or Form 1040A, line 14b 19. H&r block free tax return $6,275       If you received a lump-sum payment in 2013 that was for an earlier year, also complete Worksheet 2 or 3 and Worksheet 4 to see if you can report a lower taxable benefit. H&r block free tax return         Filled-in Worksheet 1. H&r block free tax return Figuring Your Taxable Benefits Before you begin: If you are married filing separately and you lived apart from your spouse for all of 2013, enter “D” to the right of the word “benefits” on Form 1040, line 20a, or Form 1040A, line 14a. H&r block free tax return Do not use this worksheet if you repaid benefits in 2013 and your total repayments (box 4 of Forms SSA-1099 and RRB-1099) were more than your gross benefits for 2013 (box 3 of Forms SSA-1099 and RRB-1099). H&r block free tax return None of your benefits are taxable for 2013. H&r block free tax return For more information, see Repayments More Than Gross Benefits . H&r block free tax return If you are filing Form 8815, Exclusion of Interest From Series EE and I U. H&r block free tax return S. H&r block free tax return Savings Bonds Issued After 1989, do not include the amount from line 8a of Form 1040 or Form 1040A on line 3 of this worksheet. H&r block free tax return Instead, include the amount from Schedule B (Form 1040A or 1040), line 2. H&r block free tax return 1. H&r block free tax return Enter the total amount from box 5 of ALL your Forms SSA-1099 and RRB-1099. H&r block free tax return Also enter this amount on Form 1040, line 20a, or Form 1040A, line 14a 1. H&r block free tax return $4,000         2. H&r block free tax return Enter one-half of line 1 2. H&r block free tax return 2,000     3. H&r block free tax return Combine the amounts from: Form 1040: Lines 7, 8a, 9a, 10 through 14, 15b, 16b, 17 through 19, and 21 Form 1040A: Lines 7, 8a, 9a, 10, 11b, 12b, and 13 3. H&r block free tax return 8,000     4. H&r block free tax return Enter the amount, if any, from Form 1040 or 1040A, line 8b 4. H&r block free tax return -0-     5. H&r block free tax return Enter the total of any exclusions/adjustments for: Adoption benefits (Form 8839, line 28), Foreign earned income or housing (Form 2555, lines 45 and 50, or Form 2555-EZ, line 18), and Certain income of bona fide residents of American Samoa (Form 4563, line 15) or Puerto Rico 5. H&r block free tax return -0-     6. H&r block free tax return Combine lines 2, 3, 4, and 5 6. H&r block free tax return 10,000     7. H&r block free tax return Form 1040 filers: Enter the amounts from Form 1040, lines 23 through 32, and any write-in adjustments you entered on the dotted line next to line 36. H&r block free tax return  Form 1040A filers: Enter the amounts from Form 1040A, lines 16 and 17 7. H&r block free tax return -0-     8. H&r block free tax return Is the amount on line 7 less than the amount on line 6?             No. H&r block free tax return None of your social security benefits are taxable. H&r block free tax return Enter -0- on Form 1040, line 20b, or Form 1040A, line 14b. H&r block free tax return             Yes. H&r block free tax return Subtract line 7 from line 6 8. H&r block free tax return 10,000     9. H&r block free tax return If you are:  Married filing jointly, enter $32,000 Single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013, enter $25,000 9. H&r block free tax return         Note. H&r block free tax return If you are married filing separately and you lived with your spouse at any time in 2013, skip lines 9 through 16; multiply line 8 by 85% (. H&r block free tax return 85) and enter the result on line 17. H&r block free tax return Then go to line 18. H&r block free tax return         10. H&r block free tax return Is the amount on line 9 less than the amount on line 8?             No. H&r block free tax return None of your benefits are taxable. H&r block free tax return Enter -0- on Form 1040, line 20b, or on Form 1040A, line 14b. H&r block free tax return If you are married filing separately and you lived apart from your spouse for all of 2013, be sure you entered “D” to the right of the word “benefits” on Form 1040, line 20a, or on Form 1040A, line 14a. H&r block free tax return             Yes. H&r block free tax return Subtract line 9 from line 8 10. H&r block free tax return       11. H&r block free tax return Enter $12,000 if married filing jointly; $9,000 if single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013 11. H&r block free tax return       12. H&r block free tax return Subtract line 11 from line 10. H&r block free tax return If zero or less, enter -0- 12. H&r block free tax return       13. H&r block free tax return Enter the smaller of line 10 or line 11 13. H&r block free tax return       14. H&r block free tax return Enter one-half of line 13 14. H&r block free tax return       15. H&r block free tax return Enter the smaller of line 2 or line 14 15. H&r block free tax return       16. H&r block free tax return Multiply line 12 by 85% (. H&r block free tax return 85). H&r block free tax return If line 12 is zero, enter -0- 16. H&r block free tax return       17. H&r block free tax return Add lines 15 and 16 17. H&r block free tax return 8,500     18. H&r block free tax return Multiply line 1 by 85% (. H&r block free tax return 85) 18. H&r block free tax return 3,400     19. H&r block free tax return Taxable benefits. H&r block free tax return Enter the smaller of line 17 or line 18. H&r block free tax return Also enter this amount on Form 1040, line 20b, or Form 1040A, line 14b 19. H&r block free tax return $3,400       If you received a lump-sum payment in 2013 that was for an earlier year, also complete Worksheet 2 or 3 and Worksheet 4 to see if you can report a lower taxable benefit. H&r block free tax return         Example 4. H&r block free tax return Bill and Eileen Jones are married and live together, but file separate Form 1040 returns for 2013. H&r block free tax return Bill earned $8,000 during 2013. H&r block free tax return The only other income he had for the year was $4,000 net social security benefits (box 5 of his Form SSA-1099). H&r block free tax return Bill figures his taxable benefits by completing Worksheet 1 below. H&r block free tax return He must include 85% of his social security benefits in his taxable income because he is married filing separately and lived with his spouse during 2013. H&r block free tax return See How Much Is Taxable earlier. H&r block free tax return Bill enters $4,000 on his Form 1040, line 20a, and $3,400 on Form 1040, line 20b. H&r block free tax return Lump-Sum Election You must include the taxable part of a lump-sum (retroactive) payment of benefits received in 2013 in your 2013 income, even if the payment includes benefits for an earlier year. H&r block free tax return This type of lump-sum benefit payment should not be confused with the lump-sum death benefit that both the SSA and RRB pay to many of their beneficiaries. H&r block free tax return No part of the lump-sum death benefit is subject to tax. H&r block free tax return Generally, you use your 2013 income to figure the taxable part of the total benefits received in 2013. H&r block free tax return However, you may be able to figure the taxable part of a lump-sum payment for an earlier year separately, using your income for the earlier year. H&r block free tax return You can elect this method if it lowers your taxable benefits. H&r block free tax return Under the lump-sum election method, you refigure the taxable part of all your benefits for the earlier year (including the lump-sum payment) using that year's income. H&r block free tax return Then you subtract any taxable benefits for that year that you previously reported. H&r block free tax return The remainder is the taxable part of the lump-sum payment. H&r block free tax return Add it to the taxable part of your benefits for 2013 (figured without the lump-sum payment for the earlier year). H&r block free tax return Because the earlier year's taxable benefits are included in your 2013 income, no adjustment is made to the earlier year's return. H&r block free tax return Do not file an amended return for the earlier year. H&r block free tax return Will the lump-sum election method lower your taxable benefits?   To find out, take the following steps. H&r block free tax return Complete Worksheet 1 in this publication. H&r block free tax return Complete Worksheet 2 and Worksheet 3 as appropriate. H&r block free tax return Use Worksheet 2 if your lump-sum payment was for a year after 1993. H&r block free tax return Use Worksheet 3 if it was for 1993 or an earlier year. H&r block free tax return Complete a separate Worksheet 2 or Worksheet 3 for each earlier year for which you received the lump-sum payment. H&r block free tax return Complete Worksheet 4. H&r block free tax return Compare the taxable benefits on line 19 of Worksheet 1 with the taxable benefits on line 21 of Worksheet 4. H&r block free tax return If the taxable benefits on Worksheet 4 are lower than the taxable benefits on Worksheet 1, you can elect to report the lower amount on your return. H&r block free tax return Making the election. H&r block free tax return   If you elect to report your taxable benefits under the lump-sum election method, follow the instructions at the bottom of Worksheet 4. H&r block free tax return Do not attach the completed worksheets to your return. H&r block free tax return Keep them with your records. H&r block free tax return    Once you elect this method of figuring the taxable part of a lump-sum payment, you can revoke your election only with the consent of the IRS. H&r block free tax return Lump-sum payment reported on Form SSA-1099 or RRB-1099. H&r block free tax return   If you received a lump-sum payment in 2013 that includes benefits for one or more earlier years after 1983, it will be included in box 3 of either Form SSA-1099 or Form RRB-1099. H&r block free tax return That part of any lump-sum payment for years before 1984 is not taxed and will not be shown on the form. H&r block free tax return The form will also show the year (or years) the payment is for. H&r block free tax return However, Form RRB-1099 will not show a breakdown by year (or years) of any lump-sum payment for years before 2011. H&r block free tax return You must contact the RRB for a breakdown by year for any amount shown in box 9. H&r block free tax return Example Jane Jackson is single. H&r block free tax return In 2012 she applied for social security disability benefits but was told she was ineligible. H&r block free tax return She appealed the decision and won. H&r block free tax return In 2013, she received a lump-sum payment of $6,000, of which $2,000 was for 2012 and $4,000 was for 2013. H&r block free tax return Jane also received $5,000 in social security benefits in 2013, so her total benefits in 2013 were $11,000. H&r block free tax return Jane's other income for 2012 and 2013 is as follows. H&r block free tax return   Income 2012 2013     Wages $20,000 $ 3,500     Interest income 2,000 2,500     Dividend income 1,000 1,500     Fully taxable pension   18,000     Total $23,000 $25,500   To see if the lump-sum election method results in lower taxable benefits, she completes Worksheets 1, 2, and 4 from this publication. H&r block free tax return She does not need to complete Worksheet 3 because her lump-sum payment was for years after 1993. H&r block free tax return Jane completes Worksheet 1 to find the amount of her taxable benefits for 2013 under the regular method. H&r block free tax return She completes Worksheet 2 to find the taxable part of the lump-sum payment for 2012 under the lump-sum election method. H&r block free tax return She completes Worksheet 4 to decide if the lump-sum election method will lower her taxable benefits. H&r block free tax return After completing the worksheets, Jane compares the amounts from Worksheet 4, line 21, and Worksheet 1, line 19. H&r block free tax return Because the amount on Worksheet 4 is smaller, she chooses to use the lump-sum election method. H&r block free tax return To do this, she prints “LSE” to the left of Form 1040, line 20a. H&r block free tax return She then enters $11,000 on Form 1040, line 20a, and her taxable benefits of $2,500 on line 20b. H&r block free tax return Jane's filled-in worksheets (1, 2, and 4) follow. H&r block free tax return Jane Jackson's Filled-in Worksheet 1. H&r block free tax return Figuring Your Taxable Benefits Before you begin: If you are married filing separately and you lived apart from your spouse for all of 2013, enter “D” to the right of the word “benefits” on Form 1040, line 20a, or Form 1040A, line 14a. H&r block free tax return Do not use this worksheet if you repaid benefits in 2013 and your total repayments (box 4 of Forms SSA-1099 and RRB-1099) were more than your gross benefits for 2013 (box 3 of Forms SSA-1099 and RRB-1099). H&r block free tax return None of your benefits are taxable for 2013. H&r block free tax return For more information, see Repayments More Than Gross Benefits . H&r block free tax return If you are filing Form 8815, Exclusion of Interest From Series EE and I U. H&r block free tax return S. H&r block free tax return Savings Bonds Issued After 1989, do not include the amount from line 8a of Form 1040 or Form 1040A on line 3 of this worksheet. H&r block free tax return Instead, include the amount from Schedule B (Form 1040A or 1040), line 2. H&r block free tax return 1. H&r block free tax return Enter the total amount from box 5 of ALL your Forms SSA-1099 and RRB-1099. H&r block free tax return Also enter this amount on Form 1040, line 20a, or Form 1040A, line 14a 1. H&r block free tax return $11,000         2. H&r block free tax return Enter one-half of line 1 2. H&r block free tax return 5,500     3. H&r block free tax return Combine the amounts from: Form 1040: Lines 7, 8a, 9a, 10 through 14, 15b, 16b, 17 through 19, and 21 Form 1040A: Lines 7, 8a, 9a, 10, 11b, 12b, and 13 3. H&r block free tax return 25,500     4. H&r block free tax return Enter the amount, if any, from Form 1040 or 1040A, line 8b 4. H&r block free tax return -0-     5. H&r block free tax return Enter the total of any exclusions/adjustments for: Adoption benefits (Form 8839, line 28), Foreign earned income or housing (Form 2555, lines 45 and 50, or Form 2555-EZ, line 18), and Certain income of bona fide residents of American Samoa (Form 4563, line 15) or Puerto Rico 5. H&r block free tax return -0-     6. H&r block free tax return Combine lines 2, 3, 4, and 5 6. H&r block free tax return 31,000     7. H&r block free tax return Form 1040 filers: Enter the amounts from Form 1040, lines 23 through 32, and any write-in adjustments you entered on the dotted line next to line 36. H&r block free tax return  Form 1040A filers: Enter the amounts from Form 1040A, lines 16 and 17 7. H&r block free tax return -0-     8. H&r block free tax return Is the amount on line 7 less than the amount on line 6?             No. H&r block free tax return None of your social security benefits are taxable. H&r block free tax return Enter -0- on Form 1040, line 20b, or Form 1040A, line 14b. H&r block free tax return             Yes. H&r block free tax return Subtract line 7 from line 6 8. H&r block free tax return 31,000     9. H&r block free tax return If you are:  Married filing jointly, enter $32,000 Single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013, enter $25,000 9. H&r block free tax return 25,000       Note. H&r block free tax return If you are married filing separately and you lived with your spouse at any time in 2013, skip lines 9 through 16; multiply line 8 by 85% (. H&r block free tax return 85) and enter the result on line 17. H&r block free tax return Then go to line 18. H&r block free tax return         10. H&r block free tax return Is the amount on line 9 less than the amount on line 8?             No. H&r block free tax return None of your benefits are taxable. H&r block free tax return Enter -0- on Form 1040, line 20b, or on Form 1040A, line 14b. H&r block free tax return If you are married filing separately and you lived apart from your spouse for all of 2013, be sure you entered “D” to the right of the word “benefits” on Form 1040, line 20a, or on Form 1040A, line 14a. H&r block free tax return             Yes. H&r block free tax return Subtract line 9 from line 8 10. H&r block free tax return 6,000     11. H&r block free tax return Enter $12,000 if married filing jointly; $9,000 if single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013 11. H&r block free tax return 9,000     12. H&r block free tax return Subtract line 11 from line 10. H&r block free tax return If zero or less, enter -0- 12. H&r block free tax return -0-     13. H&r block free tax return Enter the smaller of line 10 or line 11 13. H&r block free tax return 6,000     14. H&r block free tax return Enter one-half of line 13 14. H&r block free tax return 3,000     15. H&r block free tax return Enter the smaller of line 2 or line 14 15. H&r block free tax return 3,000     16. H&r block free tax return Multiply line 12 by 85% (. H&r block free tax return 85). H&r block free tax return If line 12 is zero, enter -0- 16. H&r block free tax return -0-     17. H&r block free tax return Add lines 15 and 16 17. H&r block free tax return 3,000     18. H&r block free tax return Multiply line 1 by 85% (. H&r block free tax return 85) 18. H&r block free tax return 9,350     19. H&r block free tax return Taxable benefits. H&r block free tax return Enter the smaller of line 17 or line 18. H&r block free tax return Also enter this amount on Form 1040, line 20b, or Form 1040A, line 14b 19. H&r block free tax return $3,000       If you received a lump-sum payment in 2013 that was for an earlier year, also complete Worksheet 2 or 3 and Worksheet 4 to see if you can report a lower taxable benefit. H&r block free tax return         Jane Jackson's Filled-in Worksheet 2. H&r block free tax return Figure Your Additional Taxable Benefits (From a Lump-Sum Payment for a Year After 1993)     Enter earlier year 2012 1. H&r block free tax return Enter the total amount from box 5 of ALL your Forms SSA-1099 and RRB-1099 for the earlier year, plus the lump-sum payment for the earlier year received after that year 1. H&r block free tax return $2,000           Note. H&r block free tax return If line 1 is zero or less, skip lines 2 through 20 and enter -0- on line 21. H&r block free tax return Otherwise, go on to line 2. H&r block free tax return             2. H&r block free tax return Enter one-half of line 1 2. H&r block free tax return 1,000   3. H&r block free tax return Enter your adjusted gross income for the earlier year 3. H&r block free tax return 23,000   4. H&r block free tax return Enter the total of any exclusions/adjustments you claimed in the earlier year for: Adoption benefits (Form 8839) Qualified U. H&r block free tax return S. H&r block free tax return savings bond interest (Form 8815) Student loan interest (Form 1040, page 1, or Form 1040A, page 1) Tuition and fees (Form 1040, page 1, or Form 1040A, page 1) Domestic production activities (for 2005 through 2012) (Form 1040, page 1) Foreign earned income or housing (Form 2555 or Form 2555-EZ) Certain income of bona fide residents of American Samoa (Form 4563) or Puerto Rico 4. H&r block free tax return -0-   5. H&r block free tax return Enter any tax-exempt interest received in the earlier year 5. H&r block free tax return -0-   6. H&r block free tax return Add lines 2 through 5 6. H&r block free tax return 24,000   7. H&r block free tax return Enter your taxable benefits for the earlier year that you previously reported 7. H&r block free tax return -0-   8. H&r block free tax return Subtract line 7 from line 6 8. H&r block free tax return 24,000   9. H&r block free tax return If, for the earlier year, you were:     Married filing jointly, enter $32,000 Single, head of household, qualifying widow(er), married filing separately and you lived apart from your spouse for all of the earlier year, enter $25,000 9. H&r block free tax return 25,000     Note. H&r block free tax return If you were married filing separately and you lived with your spouse at any time during the earlier year, skip lines 9 through 16; multiply line 8 by 85% (. H&r block free tax return 85) and enter the result on line 17. H&r block free tax return Then go to line 18. H&r block free tax return         10. H&r block free tax return Is the amount on line 8 more than the amount on line 9?       No. H&r block free tax return Skip lines 10 through 20 and enter -0- on line 21. H&r block free tax return       Yes. H&r block free tax return Subtract line 9 from line 8 10. H&r block free tax return     11. H&r block free tax return Enter $12,000 if married filing jointly for the earlier year; $9,000 if single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of the earlier year 11. H&r block free tax return     12. H&r block free tax return Subtract line 11 from line 10. H&r block free tax return If zero or less, enter -0- 12. H&r block free tax return     13. H&r block free tax return Enter the smaller of line 10 or line 11 13. H&r block free tax return     14. H&r block free tax return Enter one-half of line 13 14. H&r block free tax return     15. H&r block free tax return Enter the smaller of line 2 or line 14 15. H&r block free tax return     16. H&r block free tax return Multiply line 12 by 85% (. H&r block free tax return 85). H&r block free tax return If line 12 is zero, enter -0- 16. H&r block free tax return     17. H&r block free tax return Add lines 15 and 16 17. H&r block free tax return     18. H&r block free tax return Multiply line 1 by 85% (. H&r block free tax return 85) 18. H&r block free tax return     19. H&r block free tax return Refigured taxable benefits. H&r block free tax return Enter the smaller of line 17 or line 18 19. H&r block free tax return     20. H&r block free tax return Enter your taxable benefits for the earlier year (or as refigured due to a previous lump-sum payment for the year) 20. H&r block free tax return     21. H&r block free tax return Additional taxable benefits. H&r block free tax return Subtract line 20 from line 19. H&r block free tax return Also enter this amount on Worksheet 4, line 20 21. H&r block free tax return -0-     Do not file an amended return for this earlier year. H&r block free tax return Complete a separate Worksheet 2 or Worksheet 3 for each earlier year for which you received a lump-sum payment in 2013. H&r block free tax return   Jane Jackson's Filled-in Worksheet 4. H&r block free tax return Figure Your Taxable Benefits Under the Lump-Sum Election Method (Use With Worksheet 2 or 3)     Complete Worksheet 1 and Worksheets 2 and 3 as appropriate before completing this worksheet. H&r block free tax return 1. H&r block free tax return Enter the total amount from box 5 of ALL your Forms SSA-1099 and RRB-1099 for 2013, minus the lump-sum payment for years before 2013 1. H&r block free tax return $9,000         Note. H&r block free tax return If line 1 is zero or less, skip lines 2 through 18, enter -0- on line 19 and go to line 20. H&r block free tax return Otherwise, go on to line 2. H&r block free tax return           2. H&r block free tax return Enter one-half of line 1 2. H&r block free tax return 4,500   3. H&r block free tax return Enter the amount from Worksheet 1, line 3 3. H&r block free tax return 25,500   4. H&r block free tax return Enter the amount from Worksheet 1, line 4 4. H&r block free tax return -0-   5. H&r block free tax return Enter the amount from Worksheet 1, line 5 5. H&r block free tax return -0-   6. H&r block free tax return Combine lines 2, 3, 4, and 5 6. H&r block free tax return 30,000   7. H&r block free tax return Enter the amount from Worksheet 1, line 7 7. H&r block free tax return -0-   8. H&r block free tax return Subtract line 7 from line 6 8. H&r block free tax return 30,000   9. H&r block free tax return Enter the amount from Worksheet 1, line 9. H&r block free tax return But if you are married filing separately and lived with your spouse at any time during 2013, skip lines 9 through 16; multiply line 8 by 85% (. H&r block free tax return 85) and enter the result on line 17. H&r block free tax return Then, go to line 18 9. H&r block free tax return 25,000   10. H&r block free tax return Is the amount on line 8 more than the amount on line 9? No. H&r block free tax return Skip lines 10 through 18, enter -0- on line 19, and go to line 20. H&r block free tax return  Yes. H&r block free tax return Subtract line 9 from line 8 10. H&r block free tax return 5,000   11. H&r block free tax return Enter the amount from Worksheet 1, line 11 11. H&r block free tax return 9,000   12. H&r block free tax return Subtract line 11 from line 10. H&r block free tax return If zero or less, enter -0- 12. H&r block free tax return -0-   13. H&r block free tax return Enter the smaller of line 10 or line 11 13. H&r block free tax return 5,000   14. H&r block free tax return Enter one-half of line 13 14. H&r block free tax return 2,500   15. H&r block free tax return Enter the smaller of line 2 or line 14 15. H&r block free tax return 2,500   16. H&r block free tax return Multiply line 12 by 85% (. H&r block free tax return 85). H&r block free tax return If line 12 is zero, enter -0- 16. H&r block free tax return -0-   17. H&r block free tax return Add lines 15 and 16 17. H&r block free tax return 2,500   18. H&r block free tax return Multiply line 1 by 85% (. H&r block free tax return 85) 18. H&r block free tax return 7,650   19. H&r block free tax return Enter the smaller of line 17 or line 18 19. H&r block free tax return 2,500   20. H&r block free tax return Enter the total of the amounts from Worksheet 2, line 21, and Worksheet 3, line 14, for all earlier years for which the lump-sum payment was received 20. H&r block free tax return -0-   21. H&r block free tax return Taxable benefits under lump-sum election method. H&r block free tax return Add lines 19 and 20 21. H&r block free tax return $2,500   Next. H&r block free tax return Is line 21 above smaller than Worksheet 1, line 19? No. H&r block free tax return Do not use this method to figure your taxable benefits. H&r block free tax return Follow the instructions on Worksheet 1 to report your benefits. H&r block free tax return  Yes. H&r block free tax return You can elect to report your taxable benefits under this method. H&r block free tax return To elect this method:     Enter “LSE” to the left of Form 1040, line 20a, or Form 1040A, line 14a. H&r block free tax return If line 21 above is zero, follow the instructions in line 10 for “No” on Worksheet 1. H&r block free tax return Otherwise: Enter the amount from Worksheet 1, line 1, on Form 1040, line 20a, or on Form 1040A, line 14a. H&r block free tax return Enter the amount from line 21 above on Form 1040, line 20b, or on Form 1040A, line 14b. H&r block free tax return If you are married filing separately and you lived apart from your spouse for all of 2013, enter “D” to the right of the word “benefits” on Form 1040, line 20a, or Form 1040A, line 14a. H&r block free tax return   Deductions Related to Your Benefits You may be entitled to deduct certain amounts related to the benefits you receive. H&r block free tax return Disability payments. H&r block free tax return   You may have received disability payments from your employer or an insurance company that you included as income on your tax return in an earlier year. H&r block free tax return If you received a lump-sum payment from SSA or RRB, and you had to repay the employer or insurance company for the disability payments, you can take an itemized deduction for the part of the payments you included in gross income in the earlier year. H&r block free tax return If the amount you repay is more than $3,000, you may be able to claim a tax credit instead. H&r block free tax return Claim the deduction or credit in the same way explained under Repayment of benefits received in an earlier year in the section Repayments More Than Gross Benefits , later. H&r block free tax return Legal expenses. H&r block free tax return   You can usually deduct legal expenses that you pay or incur to produce or collect taxable income or in connection with the determination, collection, or refund of any tax. H&r block free tax return   Legal expenses for collecting the taxable part of your benefits are deductible as a miscellaneous itemized deduction on Schedule A (Form 1040), line 23. H&r block free tax return Repayments More Than Gross Benefits In some situations, your Form SSA-1099 or Form RRB-1099 will show that the total benefits you repaid (box 4) are more than the gross benefits (box 3) you received. H&r block free tax return If this occurred, your net benefits in box 5 will be a negative figure (a figure in parentheses) and none of your benefits will be taxable. H&r block free tax return Do not use Worksheet 1 in this case. H&r block free tax return If you receive more than one form, a negative figure in box 5 of one form is used to offset a positive figure in box 5 of another form for that same year. H&r block free tax return If you have any questions about this negative figure, contact your local SSA office or your local RRB field office. H&r block free tax return Joint return. H&r block free tax return   If you and your spouse file a joint return, and your Form SSA-1099 or RRB-1099 has a negative figure in box 5, but your spouse's does not, subtract the amount in box 5 of your form from the amount in box 5 of your spouse's form. H&r block free tax return You do this to get your net benefits when figuring if your combined benefits are taxable. H&r block free tax return Example. H&r block free tax return John and Mary file a joint return for 2013. H&r block free tax return John received Form SSA-1099 showing $3,000 in box 5. H&r block free tax return Mary also received Form SSA-1099 and the amount in box 5 was ($500). H&r block free tax return John and Mary will use $2,500 ($3,000 minus $500) as the amount of their net benefits when figuring if any of their combined benefits are taxable. H&r block free tax return Repayment of benefits received in an earlier year. H&r block free tax return   If the total amount shown in box 5 of all of your Forms SSA-1099 and RRB-1099 is a negative figure, you can take an itemized deduction for the part of this negative figure that represents benefits you included in gross income in an earlier year. H&r block free tax return Deduction $3,000 or less. H&r block free tax return   If this deduction is $3,000 or less, it is subject to the 2%-of-adjusted-gross-income limit that applies to certain miscellaneous itemized deductions. H&r block free tax return Claim it on Schedule A (Form 1040), line 23. H&r block free tax return Deduction more than $3,000. H&r block free tax return   If this deduction is more than $3,000, you should figure your tax two ways: Figure your tax for 2013 with the itemized deduction included on Schedule A, line 28. H&r block free tax return Figure your tax for 2013 in the following steps: Figure the tax without the itemized deduction included on Schedule A, line 28. H&r block free tax return For each year after 1983 for which part of the negative figure represents a repayment of benefits, refigure your taxable benefits as if your total benefits for the year were reduced by that part of the negative figure. H&r block free tax return Then refigure the tax for that year. H&r block free tax return Subtract the total of the refigured tax amounts in (b) from the total of your actual tax amounts. H&r block free tax return Subtract the result in (c) from the result in (a). H&r block free tax return   Compare the tax figured in methods (1) and (2). H&r block free tax return Your tax for 2013 is the smaller of the two amounts. H&r block free tax return If method (1) results in less tax, take the itemized deduction on Schedule A (Form 1040), line 28. H&r block free tax return If method (2) results in less tax, claim a credit for the amount from step 2(c) above on Form 1040, line 71. H&r block free tax return Check box d and enter “I. H&r block free tax return R. H&r block free tax return C. H&r block free tax return 1341” in the space next to that box. H&r block free tax return If both methods produce the same tax, deduct the repayment on Schedule A (Form 1040), line 28. H&r block free tax return Worksheets Blank Worksheets 1 through 4 are provided in this section: Worksheet 1, Figuring Your Taxable Benefits; Worksheet 2, Figure Your Additional Taxable Benefits (From a Lump-Sum Payment for a Year After 1993); Worksheet 3, Figure Your Additional Taxable Benefits (From a Lump-Sum Payment for a Year Before 1994); Worksheet 4, Figure Your Taxable Benefits Under the Lump-Sum Election Method (Use With Worksheet 2 or 3). H&r block free tax return Worksheet 1. H&r block free tax return Figuring Your Taxable Benefits Before you begin: If you are married filing separately and you lived apart from your spouse for all of 2013, enter “D” to the right of the word “benefits” on Form 1040, line 20a, or Form 1040A, line 14a. H&r block free tax return Do not use this worksheet if you repaid benefits in 2013 and your total repayments (box 4 of Forms SSA-1099 and RRB-1099) were more than your gross benefits for 2013 (box 3 of Forms SSA-1099 and RRB-1099). H&r block free tax return None of your benefits are taxable for 2013. H&r block free tax return For more information, see Repayments More Than Gross Benefits . H&r block free tax return If you are filing Form 8815, Exclusion of Interest From Series EE and I U. H&r block free tax return S. H&r block free tax return Savings Bonds Issued After 1989, do not include the amount from line 8a of Form 1040 or Form 1040A on line 3 of this worksheet. H&r block free tax return Instead, include the amount from Schedule B (Form 1040A or 1040), line 2. H&r block free tax return 1. H&r block free tax return Enter the total amount from box 5 of ALL your Forms SSA-1099 and RRB-1099. H&r block free tax return Also enter this amount on Form 1040, line 20a, or Form 1040A, line 14a 1. H&r block free tax return           2. H&r block free tax return Enter one-half of line 1 2. H&r block free tax return       3. H&r block free tax return Combine the amounts from: Form 1040: Lines 7, 8a, 9a, 10 through 14, 15b, 16b, 17 through 19, and 21 Form 1040A: Lines 7, 8a, 9a, 10, 11b, 12b, and 13 3. H&r block free tax return       4. H&r block free tax return Enter the amount, if any, from Form 1040 or 1040A, line 8b 4. H&r block free tax return       5. H&r block free tax return Enter the total of any exclusions/adjustments for: Adoption benefits (Form 8839, line 28), Foreign earned income or housing (Form 2555, lines 45 and 50, or Form 2555-EZ, line 18), and Certain income of bona fide residents of American Samoa (Form 4563, line 15) or Puerto Rico 5. H&r block free tax return       6. H&r block free tax return Combine lines 2, 3, 4, and 5 6. H&r block free tax return       7. H&r block free tax return Form 1040 filers: Enter the amounts from Form 1040, lines 23 through 32, and any write-in adjustments you entered on the dotted line next to line 36. H&r block free tax return  Form 1040A filers: Enter the amounts from Form 1040A, lines 16 and 17 7. H&r block free tax return       8. H&r block free tax return Is the amount on line 7 less than the amount on line 6?             No. H&r block free tax return None of your social security benefits are taxable. H&r block free tax return Enter -0- on Form 1040, line 20b, or Form 1040A, line 14b. H&r block free tax return             Yes. H&r block free tax return Subtract line 7 from line 6 8. H&r block free tax return       9. H&r block free tax return If you are:  Married filing jointly, enter $32,000 Single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013, enter $25,000 9. H&r block free tax return         Note. H&r block free tax return If you are married filing separately and you lived with your spouse at any time in 2013, skip lines 9 through 16; multiply line 8 by 85% (. H&r block free tax return 85) and enter the result on line 17. H&r block free tax return Then go to line 18. H&r block free tax return         10. H&r block free tax return Is the amount on line 9 less than the amount on line 8?             No. H&r block free tax return None of your benefits are taxable. H&r block free tax return Enter -0- on Form 1040, line 20b, or on Form 1040A, line 14b. H&r block free tax return If you are married filing separately and you lived apart from your spouse for all of 2013, be sure you entered “D” to the right of the word “benefits” on Form 1040, line 20a, or on Form 1040A, line 14a. H&r block free tax return             Yes. H&r block free tax return Subtract line 9 from line 8 10. H&r block free tax return       11. H&r block free tax return Enter $12,000 if married filing jointly; $9,000 if single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013 11. H&r block free tax return       12. H&r block free tax return Subtract line 11 from line 10. H&r block free tax return If zero or less, enter -0- 12. H&r block free tax return       13. H&r block free tax return Enter the smaller of line 10 or line 11 13. H&r block free tax return       14. H&r block free tax return Enter one-half of line 13 14. H&r block free tax return       15. H&r block free tax return Enter the smaller of line 2 or line 14 15. H&r block free tax return       16. H&r block free tax return Multiply line 12 by 85% (. H&r block free tax return 85). H&r block free tax return If line 12 is zero, enter -0- 16. H&r block free tax return       17. H&r block free tax return Add lines 15 and 16 17. H&r block free tax return       18. H&r block free tax return Multiply line 1 by 85% (. H&r block free tax return 85) 18. H&r block free tax return       19. H&r block free tax return Taxable benefits. H&r block free tax return Enter the smaller of line 17 or line 18. H&r block free tax return Also enter this amount on Form 1040, line 20b, or Form 1040A, line 14b 19. H&r block free tax return         If you received a lump-sum payment in 2013 that was for an earlier year, also complete Worksheet 2 or 3 and Worksheet 4 to see if you can report a lower taxable benefit. H&r block free tax return         Worksheet 2. H&r block free tax return Figure Your Additional Taxable Benefits (From a Lump-Sum Payment for a Year After 1993)     Enter earlier year 1. H&r block free tax return Enter the total amount from box 5 of ALL your Forms SSA-1099 and RRB-1099 for the earlier year, plus the lump-sum payment for the earlier year received after that year 1. H&r block free tax return             Note. H&r block free tax return If line 1 is zero or less, skip lines 2 through 20 and enter -0- on line 21. H&r block free tax return Otherwise, go on to line 2. H&r block free tax return             2. H&r block free tax return Enter one-half of line 1 2. H&r block free tax return     3. H&r block free tax return Enter your adjusted gross income for the earlier year 3. H&r block free tax return     4. H&r block free tax return Enter the total of any exclusions/adjustments you claimed in the earlier year for: Adoption benefits (Form 8839) Qualified U. H&r block free tax return S. H&r block free tax return savings bond interest (Form 8815) Student loan interest (Form 1040, page 1, or Form 1040A, page 1) Tuition and fees (Form 1040, page 1, or Form 1040A, page 1) Domestic production activities (for 2005 through 2012) (Form 1040, page 1) Foreign earned income or housing (Form 2555 or Form 2555-EZ) Certain income of bona fide residents of American Samoa (Form 4563) or Puerto Rico 4. H&r block free tax return     5. H&r block free tax return Enter any tax-exempt interest received in the earlier year 5. H&r block free tax return     6. H&r block free tax return Add lines 2 through 5 6. H&r block free tax return     7. H&r block free tax return Enter your taxable benefits for the earlier year that you previously reported 7. H&r block free tax return     8. H&r block free tax return Subtract line 7 from line 6 8. H&r block free tax return     9. H&r block free tax return If, for the earlier year, you were:     Married filing jointly, enter $32,000 Single, head of household, qualifying widow(er), married filing separately and you lived apart from your spouse for all of the earlier year, enter $25,000 9. H&r block free tax return       Note. H&r block free tax return If you were married filing separately and you lived with your spouse at any time during the earlier year, skip lines 9 through 16; multiply line 8 by 85% (. H&r block free tax return 85) and enter the result on line 17. H&r block free tax return Then go to line 18. H&r block free tax return         10. H&r block free tax return Is the amount on line 8 more than the amount on line 9?       No. H&r block free tax return Skip lines 10 through 20 and enter -0- on line 21. H&r block free tax return       Yes. H&r block free tax return Subtract line 9 from line 8 10. H&r block free tax return     11. H&r block free tax return Enter $12,000 if married filing jointly for the earlier year; $9,000 if single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of the earlier year 11. H&r block free tax return     12. H&r block free tax return Subtract line 11 from line 10. H&r block free tax return If zero or less, enter -0- 12. H&r block free tax return     13. H&r block free tax return Enter the smaller of line 10 or line 11 13. H&r block free tax return     14. H&r block free tax return Enter one-half of line 13 14. H&r block free tax return     15. H&r block free tax return Enter the smaller of line 2 or line 14 15. H&r block free tax return     16. H&r block free tax return Multiply line 12 by 85% (. H&r block free tax return 85). H&r block free tax return If line 12 is zero, enter -0- 16. H&r block free tax return     17. H&r block free tax return Add lines 15 and 16 17. H&r block free tax return     18. H&r block free tax return Multiply line 1 by 85% (. H&r block free tax return 85) 18. H&r block free tax return     19. H&r block free tax return Refigured taxable benefits. H&r block free tax return Enter the smaller of line 17 or line 18 19. H&r block free tax return     20. H&r block free tax return Enter your taxable benefits for the earlier year (or as refigured due to a previous lump-sum payment for the year) 20. H&r block free tax return     21. H&r block free tax return Additional taxable benefits. H&r block free tax return Subtract line 20 from line 19. H&r block free tax return Also enter this amount on Worksheet 4, line 20 21. H&r block free tax return       Do not file an amended return for this earlier year. H&r block free tax return Complete a separate Worksheet 2 or Worksheet 3 for each earlier year for which you received a lump-sum payment in 2013. H&r block free tax return   Worksheet 3. H&r block free tax return Figure Your Additional Taxable Benefits (From a Lump-Sum Payment for a Year Before 1994) Enter earlier year 1. H&r block free tax return Enter the total amount from box 5 of ALL your Forms SSA-1099 and RRB-1099 for the earlier year, plus the lump-sum payment for the earlier year received after that year 1. H&r block free tax return           Note. H&r block free tax return If line 1 is zero or less, skip lines 2 through 13 and enter -0- on line 14. H&r block free tax return Otherwise, go on to line 2. H&r block free tax return           2. H&r block free tax return Enter one-half of line 1 2. H&r block free tax return     3. H&r block free tax return Enter your adjusted gross income for the earlier year 3. H&r block free tax return     4. H&r block free tax return Enter the total of any exclusions/adjustments you claimed in the earlier year for: Qualified U. H&r block free tax return S. H&r block free tax return savings bond interest (Form 8815) Foreign earned income or housing (Form 2555 or Form 2555-EZ) Certain income of bona fide residents of American Samoa (Form 4563) or Puerto Rico 4. H&r block free tax return     5. H&r block free tax return Enter any tax-exempt interest received in the earlier year 5. H&r block free tax return     6. H&r block free tax return Add lines 2 through 5 6. H&r block free tax return     7. H&r block free tax return Enter your taxable benefits for the earlier year that you previously reported 7. H&r block free tax return     8. H&r block free tax return Subtract line 7 from line 6 8. H&r block free tax return     9. H&r block free tax return Enter $25,000 ($32,000 if married filing jointly for the earlier year; $-0- if married filing separately for the earlier year and you lived with your spouse at any time during the earlier year) 9. H&r block free tax return     10. H&r block free tax return Is the amount on line 8 more than the amount on line 9? No. H&r block free tax return Skip lines 10 through 13 and enter -0- on line 14. H&r block free tax return  Yes. H&r block free tax return Subtract line 9 from line 8. H&r block free tax return 10. H&r block free tax return     11. H&r block free tax return Enter one-half of line 10 11. H&r block free tax return     12. H&r block free tax return Refigured taxable benefits. H&r block free tax return Enter the smaller of line 2 or line 11 12. H&r block free tax return     13. H&r block free tax return Enter your taxable benefits for the earlier year (or as refigured due to a previous