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Turbo Tax 2011

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Turbo Tax 2011

Turbo tax 2011 Publication 15-B - Main Content Table of Contents 1. Turbo tax 2011 Fringe Benefit OverviewAre Fringe Benefits Taxable? Cafeteria Plans Simple Cafeteria Plans 2. Turbo tax 2011 Fringe Benefit Exclusion RulesAccident and Health Benefits Achievement Awards Adoption Assistance Athletic Facilities De Minimis (Minimal) Benefits Dependent Care Assistance Educational Assistance Employee Discounts Employee Stock Options Employer-Provided Cell Phones Group-Term Life Insurance Coverage Health Savings Accounts Lodging on Your Business Premises Meals Moving Expense Reimbursements No-Additional-Cost Services Retirement Planning Services Transportation (Commuting) Benefits Tuition Reduction Working Condition Benefits 3. Turbo tax 2011 Fringe Benefit Valuation RulesGeneral Valuation Rule Cents-Per-Mile Rule Commuting Rule Lease Value Rule Unsafe Conditions Commuting Rule 4. Turbo tax 2011 Rules for Withholding, Depositing, and ReportingTransfer of property. Turbo tax 2011 Amount of deposit. Turbo tax 2011 Limitation. Turbo tax 2011 Conformity rules. Turbo tax 2011 Election not to withhold income tax. Turbo tax 2011 How To Get Tax Help 1. Turbo tax 2011 Fringe Benefit Overview A fringe benefit is a form of pay for the performance of services. Turbo tax 2011 For example, you provide an employee with a fringe benefit when you allow the employee to use a business vehicle to commute to and from work. Turbo tax 2011 Performance of services. Turbo tax 2011   A person who performs services for you does not have to be your employee. Turbo tax 2011 A person may perform services for you as an independent contractor, partner, or director. Turbo tax 2011 Also, for fringe benefit purposes, treat a person who agrees not to perform services (such as under a covenant not to compete) as performing services. Turbo tax 2011 Provider of benefit. Turbo tax 2011   You are the provider of a fringe benefit if it is provided for services performed for you. Turbo tax 2011 You are considered the provider of a fringe benefit even if a third party, such as your client or customer, provides the benefit to your employee for services the employee performs for you. Turbo tax 2011 For example, if, in exchange for goods or services, your customer provides day care services as a fringe benefit to your employees for services they provide for you as their employer, then you are the provider of this fringe benefit even though the customer is actually providing the day care. Turbo tax 2011 Recipient of benefit. Turbo tax 2011   The person who performs services for you is considered the recipient of a fringe benefit provided for those services. Turbo tax 2011 That person may be considered the recipient even if the benefit is provided to someone who did not perform services for you. Turbo tax 2011 For example, your employee may be the recipient of a fringe benefit you provide to a member of the employee's family. Turbo tax 2011 Are Fringe Benefits Taxable? Any fringe benefit you provide is taxable and must be included in the recipient's pay unless the law specifically excludes it. Turbo tax 2011 Section 2 discusses the exclusions that apply to certain fringe benefits. Turbo tax 2011 Any benefit not excluded under the rules discussed in section 2 is taxable. Turbo tax 2011 Including taxable benefits in pay. Turbo tax 2011   You must include in a recipient's pay the amount by which the value of a fringe benefit is more than the sum of the following amounts. Turbo tax 2011 Any amount the law excludes from pay. Turbo tax 2011 Any amount the recipient paid for the benefit. Turbo tax 2011 The rules used to determine the value of a fringe benefit are discussed in section 3. Turbo tax 2011   If the recipient of a taxable fringe benefit is your employee, the benefit is subject to employment taxes and must be reported on Form W-2, Wage and Tax Statement. Turbo tax 2011 However, you can use special rules to withhold, deposit, and report the employment taxes. Turbo tax 2011 These rules are discussed in section 4. Turbo tax 2011   If the recipient of a taxable fringe benefit is not your employee, the benefit is not subject to employment taxes. Turbo tax 2011 However, you may have to report the benefit on one of the following information returns. Turbo tax 2011 If the recipient receives the benefit as: Use: An independent contractor Form 1099-MISC, Miscellaneous Income A partner Schedule K-1 (Form 1065), Partner's Share of Income, Deductions, Credits, etc. Turbo tax 2011 For more information, see the instructions for the forms listed above. Turbo tax 2011 Cafeteria Plans A cafeteria plan, including a flexible spending arrangement, is a written plan that allows your employees to choose between receiving cash or taxable benefits instead of certain qualified benefits for which the law provides an exclusion from wages. Turbo tax 2011 If an employee chooses to receive a qualified benefit under the plan, the fact that the employee could have received cash or a taxable benefit instead will not make the qualified benefit taxable. Turbo tax 2011 Generally, a cafeteria plan does not include any plan that offers a benefit that defers pay. Turbo tax 2011 However, a cafeteria plan can include a qualified 401(k) plan as a benefit. Turbo tax 2011 Also, certain life insurance plans maintained by educational institutions can be offered as a benefit even though they defer pay. Turbo tax 2011 Qualified benefits. Turbo tax 2011   A cafeteria plan can include the following benefits discussed in section 2. Turbo tax 2011 Accident and health benefits (but not Archer medical savings accounts (Archer MSAs) or long-term care insurance). Turbo tax 2011 Adoption assistance. Turbo tax 2011 Dependent care assistance. Turbo tax 2011 Group-term life insurance coverage (including costs that cannot be excluded from wages). Turbo tax 2011 Health savings accounts (HSAs). Turbo tax 2011 Distributions from an HSA may be used to pay eligible long-term care insurance premiums or qualified long-term care services. Turbo tax 2011 Benefits not allowed. Turbo tax 2011   A cafeteria plan cannot include the following benefits discussed in section 2. Turbo tax 2011 Archer MSAs. Turbo tax 2011 See Accident and Health Benefits in section 2. Turbo tax 2011 Athletic facilities. Turbo tax 2011 De minimis (minimal) benefits. Turbo tax 2011 Educational assistance. Turbo tax 2011 Employee discounts. Turbo tax 2011 Employer-provided cell phones. Turbo tax 2011 Lodging on your business premises. Turbo tax 2011 Meals. Turbo tax 2011 Moving expense reimbursements. Turbo tax 2011 No-additional-cost services. Turbo tax 2011 Transportation (commuting) benefits. Turbo tax 2011 Tuition reduction. Turbo tax 2011 Working condition benefits. Turbo tax 2011 It also cannot include scholarships or fellowships (discussed in Publication 970, Tax Benefits for Education). Turbo tax 2011 $2,500 limit on a health flexible spending arrangement (FSA). Turbo tax 2011   For plan years beginning after December 31, 2012, a cafeteria plan may not allow an employee to request salary reduction contributions for a health FSA in excess of $2,500. Turbo tax 2011 For plan years beginning after December 31, 2013, the limit is unchanged at $2,500. Turbo tax 2011   A cafeteria plan offering a health FSA must be amended to specify the $2,500 limit (or any lower limit set by the employer). Turbo tax 2011 While cafeteria plans generally must be amended on a prospective basis, an amendment that is adopted on or before December 31, 2014, may be made effective retroactively, provided that in operation the cafeteria plan meets the limit for plan years beginning after December 31, 2012. Turbo tax 2011 A cafeteria plan that does not limit health FSA contributions to the dollar limit is not a cafeteria plan and all benefits offered under the plan are includible in the employee's gross income. Turbo tax 2011   For more information, see Notice 2012-40, 2012-26 I. Turbo tax 2011 R. Turbo tax 2011 B. Turbo tax 2011 1046, available at www. Turbo tax 2011 irs. Turbo tax 2011 gov/irb/2012-26_IRB/ar09. Turbo tax 2011 html. Turbo tax 2011 Employee. Turbo tax 2011   For these plans, treat the following individuals as employees. Turbo tax 2011 A current common-law employee. Turbo tax 2011 See section 2 in Publication 15 (Circular E) for more information. Turbo tax 2011 A full-time life insurance agent who is a current statutory employee. Turbo tax 2011 A leased employee who has provided services to you on a substantially full-time basis for at least a year if the services are performed under your primary direction or control. Turbo tax 2011 Exception for S corporation shareholders. Turbo tax 2011   Do not treat a 2% shareholder of an S corporation as an employee of the corporation for this purpose. Turbo tax 2011 A 2% shareholder for this purpose is someone who directly or indirectly owns (at any time during the year) more than 2% of the corporation's stock or stock with more than 2% of the voting power. Turbo tax 2011 Treat a 2% shareholder as you would a partner in a partnership for fringe benefit purposes, but do not treat the benefit as a reduction in distributions to the 2% shareholder. Turbo tax 2011 Plans that favor highly compensated employees. Turbo tax 2011   If your plan favors highly compensated employees as to eligibility to participate, contributions, or benefits, you must include in their wages the value of taxable benefits they could have selected. Turbo tax 2011 A plan you maintain under a collective bargaining agreement does not favor highly compensated employees. Turbo tax 2011   A highly compensated employee for this purpose is any of the following employees. Turbo tax 2011 An officer. Turbo tax 2011 A shareholder who owns more than 5% of the voting power or value of all classes of the employer's stock. Turbo tax 2011 An employee who is highly compensated based on the facts and circumstances. Turbo tax 2011 A spouse or dependent of a person described in (1), (2), or (3). Turbo tax 2011 Plans that favor key employees. Turbo tax 2011   If your plan favors key employees, you must include in their wages the value of taxable benefits they could have selected. Turbo tax 2011 A plan favors key employees if more than 25% of the total of the nontaxable benefits you provide for all employees under the plan go to key employees. Turbo tax 2011 However, a plan you maintain under a collective bargaining agreement does not favor key employees. Turbo tax 2011   A key employee during 2014 is generally an employee who is either of the following. Turbo tax 2011 An officer having annual pay of more than $170,000. Turbo tax 2011 An employee who for 2014 is either of the following. Turbo tax 2011 A 5% owner of your business. Turbo tax 2011 A 1% owner of your business whose annual pay was more than $150,000. Turbo tax 2011 Simple Cafeteria Plans Eligible employers meeting contribution requirements and eligibility and participation requirements can establish a simple cafeteria plan. Turbo tax 2011 Simple cafeteria plans are treated as meeting the nondiscrimination requirements of a cafeteria plan and certain benefits under a cafeteria plan. Turbo tax 2011 Eligible employer. Turbo tax 2011   You are an eligible employer if you employ an average of 100 or fewer employees during either of the 2 preceding years. Turbo tax 2011 If your business was not in existence throughout the preceding year, you are eligible if you reasonably expect to employ an average of 100 or fewer employees in the current year. Turbo tax 2011 If you establish a simple cafeteria plan in a year that you employ an average of 100 or fewer employees, you are considered an eligible employer for any subsequent year as long as you do not employ an average of 200 or more employees in a subsequent year. Turbo tax 2011 Eligibility and participation requirements. Turbo tax 2011   These requirements are met if all employees who had at least 1,000 hours of service for the preceding plan year are eligible to participate and each employee eligible to participate in the plan may elect any benefit available under the plan. Turbo tax 2011 You may elect to exclude from the plan employees who: Are under age 21 before the close of the plan year, Have less than 1 year of service with you as of any day during the plan year, Are covered under a collective bargaining agreement, or Are nonresident aliens working outside the United States whose income did not come from a U. Turbo tax 2011 S. Turbo tax 2011 source. Turbo tax 2011 Contribution requirements. Turbo tax 2011   You must make a contribution to provide qualified benefits on behalf of each qualified employee in an amount equal to: A uniform percentage (not less than 2%) of the employee’s compensation for the plan year, or An amount which is at least 6% of the employee’s compensation for the plan year or twice the amount of the salary reduction contributions of each qualified employee, whichever is less. Turbo tax 2011 If the contribution requirements are met using option (2), the rate of contribution to any salary reduction contribution of a highly compensated or key employee can not be greater than the rate of contribution to any other employee. Turbo tax 2011 More information. Turbo tax 2011   For more information about cafeteria plans, see section 125 of the Internal Revenue Code and its regulations. Turbo tax 2011 2. Turbo tax 2011 Fringe Benefit Exclusion Rules This section discusses the exclusion rules that apply to fringe benefits. Turbo tax 2011 These rules exclude all or part of the value of certain benefits from the recipient's pay. Turbo tax 2011 The excluded benefits are not subject to federal income tax withholding. Turbo tax 2011 Also, in most cases, they are not subject to social security, Medicare, or federal unemployment (FUTA) tax and are not reported on Form W-2. Turbo tax 2011 This section discusses the exclusion rules for the following fringe benefits. Turbo tax 2011 Accident and health benefits. Turbo tax 2011 Achievement awards. Turbo tax 2011 Adoption assistance. Turbo tax 2011 Athletic facilities. Turbo tax 2011 De minimis (minimal) benefits. Turbo tax 2011 Dependent care assistance. Turbo tax 2011 Educational assistance. Turbo tax 2011 Employee discounts. Turbo tax 2011 Employee stock options. Turbo tax 2011 Employer-provided cell phones. Turbo tax 2011 Group-term life insurance coverage. Turbo tax 2011 Health savings accounts (HSAs). Turbo tax 2011 Lodging on your business premises. Turbo tax 2011 Meals. Turbo tax 2011 Moving expense reimbursements. Turbo tax 2011 No-additional-cost services. Turbo tax 2011 Retirement planning services. Turbo tax 2011 Transportation (commuting) benefits. Turbo tax 2011 Tuition reduction. Turbo tax 2011 Working condition benefits. Turbo tax 2011 See Table 2-1, later, for an overview of the employment tax treatment of these benefits. Turbo tax 2011 Table 2-1. Turbo tax 2011 Special Rules for Various Types of Fringe Benefits (For more information, see the full discussion in this section. Turbo tax 2011 ) Treatment Under Employment Taxes Type of Fringe Benefit Income Tax Withholding Social Security and Medicare (including Additional Medicare Tax when wages are paid in excess of $200,000) Federal Unemployment (FUTA) Accident and health benefits Exempt1,2, except for long-term care benefits provided through a flexible spending or similar arrangement. Turbo tax 2011 Exempt, except for certain payments to S corporation employees who are 2% shareholders. Turbo tax 2011 Exempt Achievement awards Exempt1 up to $1,600 for qualified plan awards ($400 for nonqualified awards). Turbo tax 2011 Adoption assistance Exempt1,3 Taxable Taxable Athletic facilities Exempt if substantially all use during the calendar year is by employees, their spouses, and their dependent children and the facility is operated by the employer on premises owned or leased by the employer. Turbo tax 2011 De minimis (minimal) benefits Exempt Exempt Exempt Dependent care assistance Exempt3 up to certain limits, $5,000 ($2,500 for married employee filing separate return). Turbo tax 2011 Educational assistance Exempt up to $5,250 of benefits each year. Turbo tax 2011 (See Educational Assistance , later in this section. Turbo tax 2011 ) Employee discounts Exempt3 up to certain limits. Turbo tax 2011 (See Employee Discounts , later in this section. Turbo tax 2011 ) Employee stock options See Employee Stock Options , later in this section. Turbo tax 2011 Employer-provided cell phones Exempt if provided primarily for noncompensatory business purposes. Turbo tax 2011 Group-term life insurance coverage Exempt Exempt1,4, 7 up to cost of $50,000 of coverage. Turbo tax 2011 (Special rules apply to former employees. Turbo tax 2011 ) Exempt Health savings accounts (HSAs) Exempt for qualified individuals up to the HSA contribution limits. Turbo tax 2011 (See Health Savings Accounts , later in this section. Turbo tax 2011 ) Lodging on your business premises Exempt1 if furnished for your convenience as a condition of employment. Turbo tax 2011 Meals Exempt if furnished on your business premises for your convenience. Turbo tax 2011 Exempt if de minimis. Turbo tax 2011 Moving expense reimbursements Exempt1 if expenses would be deductible if the employee had paid them. Turbo tax 2011 No-additional-cost services Exempt3 Exempt3 Exempt3 Retirement planning services Exempt5 Exempt5 Exempt5 Transportation (commuting) benefits Exempt1 up to certain limits if for rides in a commuter highway vehicle and/or transit passes ($130), qualified parking ($250), or qualified bicycle commuting reimbursement6 ($20). Turbo tax 2011 (See Transportation (Commuting) Benefits , later in this section. Turbo tax 2011 ) Exempt if de minimis. Turbo tax 2011 Tuition reduction Exempt3 if for undergraduate education (or graduate education if the employee performs teaching or research activities). Turbo tax 2011 Working condition benefits Exempt Exempt Exempt 1 Exemption does not apply to S corporation employees who are 2% shareholders. Turbo tax 2011 2 Exemption does not apply to certain highly compensated employees under a self-insured plan that favors those employees. Turbo tax 2011 3 Exemption does not apply to certain highly compensated employees under a program that favors those employees. Turbo tax 2011 4 Exemption does not apply to certain key employees under a plan that favors those employees. Turbo tax 2011 5 Exemption does not apply to services for tax preparation, accounting, legal, or brokerage services. Turbo tax 2011 6 If the employee receives a qualified bicycle commuting reimbursement in a qualified bicycle commuting month, the employee cannot receive commuter highway vehicle, transit pass, or qualified parking benefits in that same month. Turbo tax 2011 7 You must include in your employee's wages the cost of group-term life insurance beyond $50,000 worth of coverage, reduced by the amount the employee paid toward the insurance. Turbo tax 2011 Report it as wages in boxes 1, 3, and 5 of the employee's Form W-2. Turbo tax 2011 Also, show it in box 12 with code “C. Turbo tax 2011 ” The amount is subject to social security and Medicare taxes, and you may, at your option, withhold federal income tax. Turbo tax 2011 Accident and Health Benefits This exclusion applies to contributions you make to an accident or health plan for an employee, including the following. Turbo tax 2011 Contributions to the cost of accident or health insurance including qualified long-term care insurance. Turbo tax 2011 Contributions to a separate trust or fund that directly or through insurance provides accident or health benefits. Turbo tax 2011 Contributions to Archer MSAs or health savings accounts (discussed in Publication 969, Health Savings Accounts and Other Tax-Favored Health Plans). Turbo tax 2011 This exclusion also applies to payments you directly or indirectly make to an employee under an accident or health plan for employees that are either of the following. Turbo tax 2011 Payments or reimbursements of medical expenses. Turbo tax 2011 Payments for specific injuries or illnesses (such as the loss of the use of an arm or leg). Turbo tax 2011 The payments must be figured without regard to any period of absence from work. Turbo tax 2011 Accident or health plan. Turbo tax 2011   This is an arrangement that provides benefits for your employees, their spouses, their dependents, and their children (under age 27) in the event of personal injury or sickness. Turbo tax 2011 The plan may be insured or noninsured and does not need to be in writing. Turbo tax 2011 Employee. Turbo tax 2011   For this exclusion, treat the following individuals as employees. Turbo tax 2011 A current common-law employee. Turbo tax 2011 A full-time life insurance agent who is a current statutory employee. Turbo tax 2011 A retired employee. Turbo tax 2011 A former employee you maintain coverage for based on the employment relationship. Turbo tax 2011 A widow or widower of an individual who died while an employee. Turbo tax 2011 A widow or widower of a retired employee. Turbo tax 2011 For the exclusion of contributions to an accident or health plan, a leased employee who has provided services to you on a substantially full-time basis for at least a year if the services are performed under your primary direction or control. Turbo tax 2011 Special rule for certain government plans. Turbo tax 2011   For certain government accident and health plans, payments to a deceased plan participant's beneficiary may qualify for the exclusion from gross income if the other requirements for exclusion are met. Turbo tax 2011 See section 105(j) for details. Turbo tax 2011 Exception for S corporation shareholders. Turbo tax 2011   Do not treat a 2% shareholder of an S corporation as an employee of the corporation for this purpose. Turbo tax 2011 A 2% shareholder is someone who directly or indirectly owns (at any time during the year) more than 2% of the corporation's stock or stock with more than 2% of the voting power. Turbo tax 2011 Treat a 2% shareholder as you would a partner in a partnership for fringe benefit purposes, but do not treat the benefit as a reduction in distributions to the 2% shareholder. Turbo tax 2011 Exclusion from wages. Turbo tax 2011   You can generally exclude the value of accident or health benefits you provide to an employee from the employee's wages. Turbo tax 2011 Exception for certain long-term care benefits. Turbo tax 2011   You cannot exclude contributions to the cost of long-term care insurance from an employee's wages subject to federal income tax withholding if the coverage is provided through a flexible spending or similar arrangement. Turbo tax 2011 This is a benefit program that reimburses specified expenses up to a maximum amount that is reasonably available to the employee and is less than five times the total cost of the insurance. Turbo tax 2011 However, you can exclude these contributions from the employee's wages subject to social security, Medicare, and federal unemployment (FUTA) taxes. Turbo tax 2011 S corporation shareholders. Turbo tax 2011   Because you cannot treat a 2% shareholder of an S corporation as an employee for this exclusion, you must include the value of accident or health benefits you provide to the employee in the employee's wages subject to federal income tax withholding. Turbo tax 2011 However, you can exclude the value of these benefits (other than payments for specific injuries or illnesses) from the employee's wages subject to social security, Medicare, and FUTA taxes. Turbo tax 2011 Exception for highly compensated employees. Turbo tax 2011   If your plan is a self-insured medical reimbursement plan that favors highly compensated employees, you must include all or part of the amounts you pay to these employees in their wages subject to federal income tax withholding. Turbo tax 2011 However, you can exclude these amounts (other than payments for specific injuries or illnesses) from the employee's wages subject to social security, Medicare, and FUTA taxes. Turbo tax 2011   A self-insured plan is a plan that reimburses your employees for medical expenses not covered by an accident or health insurance policy. Turbo tax 2011   A highly compensated employee for this exception is any of the following individuals. Turbo tax 2011 One of the five highest paid officers. Turbo tax 2011 An employee who owns (directly or indirectly) more than 10% in value of the employer's stock. Turbo tax 2011 An employee who is among the highest paid 25% of all employees (other than those who can be excluded from the plan). Turbo tax 2011   For more information on this exception, see section 105(h) of the Internal Revenue Code and its regulations. Turbo tax 2011 COBRA premiums. Turbo tax 2011   The exclusion for accident and health benefits applies to amounts you pay to maintain medical coverage for a current or former employee under the Combined Omnibus Budget Reconciliation Act of 1986 (COBRA). Turbo tax 2011 The exclusion applies regardless of the length of employment, whether you directly pay the premiums or reimburse the former employee for premiums paid, and whether the employee's separation is permanent or temporary. Turbo tax 2011 Achievement Awards This exclusion applies to the value of any tangible personal property you give to an employee as an award for either length of service or safety achievement. Turbo tax 2011 The exclusion does not apply to awards of cash, cash equivalents, gift certificates, or other intangible property such as vacations, meals, lodging, tickets to theater or sporting events, stocks, bonds, and other securities. Turbo tax 2011 The award must meet the requirements for employee achievement awards discussed in chapter 2 of Publication 535, Business Expenses. Turbo tax 2011 Employee. Turbo tax 2011   For this exclusion, treat the following individuals as employees. Turbo tax 2011 A current employee. Turbo tax 2011 A former common-law employee you maintain coverage for in consideration of or based on an agreement relating to prior service as an employee. Turbo tax 2011 A leased employee who has provided services to you on a substantially full-time basis for at least a year if the services are performed under your primary direction or control. Turbo tax 2011 Exception for S corporation shareholders. Turbo tax 2011   Do not treat a 2% shareholder of an S corporation as an employee of the corporation for this purpose. Turbo tax 2011 A 2% shareholder is someone who directly or indirectly owns (at any time during the year) more than 2% of the corporation's stock or stock with more than 2% of the voting power. Turbo tax 2011 Treat a 2% shareholder as you would a partner in a partnership for fringe benefit purposes, but do not treat the benefit as a reduction in distributions to the 2% shareholder. Turbo tax 2011 Exclusion from wages. Turbo tax 2011   You can generally exclude the value of achievement awards you give to an employee from the employee's wages if their cost is not more than the amount you can deduct as a business expense for the year. Turbo tax 2011 The excludable annual amount is $1,600 ($400 for awards that are not “qualified plan awards”). Turbo tax 2011 See chapter 2 of Publication 535 for more information about the limit on deductions for employee achievement awards. Turbo tax 2011    To determine for 2014 whether an achievement award is a “qualified plan award” under the deduction rules described in Publication 535, treat any employee who received more than $115,000 in pay for 2013 as a highly compensated employee. Turbo tax 2011   If the cost of awards given to an employee is more than your allowable deduction, include in the employee's wages the larger of the following amounts. Turbo tax 2011 The part of the cost that is more than your allowable deduction (up to the value of the awards). Turbo tax 2011 The amount by which the value of the awards exceeds your allowable deduction. Turbo tax 2011 Exclude the remaining value of the awards from the employee's wages. Turbo tax 2011 Adoption Assistance An adoption assistance program is a separate written plan of an employer that meets all of the following requirements. Turbo tax 2011 It benefits employees who qualify under rules set up by you, which do not favor highly compensated employees or their dependents. Turbo tax 2011 To determine whether your plan meets this test, do not consider employees excluded from your plan who are covered by a collective bargaining agreement, if there is evidence that adoption assistance was a subject of good-faith bargaining. Turbo tax 2011 It does not pay more than 5% of its payments during the year for shareholders or owners (or their spouses or dependents). Turbo tax 2011 A shareholder or owner is someone who owns (on any day of the year) more than 5% of the stock or of the capital or profits interest of your business. Turbo tax 2011 You give reasonable notice of the plan to eligible employees. Turbo tax 2011 Employees provide reasonable substantiation that payments or reimbursements are for qualifying expenses. Turbo tax 2011 For this exclusion, a highly compensated employee for 2014 is an employee who meets either of the following tests. Turbo tax 2011 The employee was a 5% owner at any time during the year or the preceding year. Turbo tax 2011 The employee received more than $115,000 in pay for the preceding year. Turbo tax 2011 You can choose to ignore test (2) if the employee was not also in the top 20% of employees when ranked by pay for the preceding year. Turbo tax 2011 You must exclude all payments or reimbursements you make under an adoption assistance program for an employee's qualified adoption expenses from the employee's wages subject to federal income tax withholding. Turbo tax 2011 However, you cannot exclude these payments from wages subject to social security, Medicare, and federal unemployment (FUTA) taxes. Turbo tax 2011 For more information, see the Instructions for Form 8839, Qualified Adoption Expenses. Turbo tax 2011 You must report all qualifying adoption expenses you paid or reimbursed under your adoption assistance program for each employee for the year in box 12 of the employee's Form W-2. Turbo tax 2011 Use code “T” to identify this amount. Turbo tax 2011 Exception for S corporation shareholders. Turbo tax 2011   For this exclusion, do not treat a 2% shareholder of an S corporation as an employee of the corporation. Turbo tax 2011 A 2% shareholder is someone who directly or indirectly owns (at any time during the year) more than 2% of the corporation's stock or stock with more than 2% of the voting power. Turbo tax 2011 Treat a 2% shareholder as you would a partner in a partnership for fringe benefit purposes, including using the benefit as a reduction in distributions to the 2% shareholder. Turbo tax 2011 Athletic Facilities You can exclude the value of an employee's use of an on-premises gym or other athletic facility you operate from an employee's wages if substantially all use of the facility during the calendar year is by your employees, their spouses, and their dependent children. Turbo tax 2011 For this purpose, an employee's dependent child is a child or stepchild who is the employee's dependent or who, if both parents are deceased, has not attained the age of 25. Turbo tax 2011 On-premises facility. Turbo tax 2011   The athletic facility must be located on premises you own or lease. Turbo tax 2011 It does not have to be located on your business premises. Turbo tax 2011 However, the exclusion does not apply to an athletic facility for residential use, such as athletic facilities that are part of a resort. Turbo tax 2011 Employee. Turbo tax 2011   For this exclusion, treat the following individuals as employees. Turbo tax 2011 A current employee. Turbo tax 2011 A former employee who retired or left on disability. Turbo tax 2011 A widow or widower of an individual who died while an employee. Turbo tax 2011 A widow or widower of a former employee who retired or left on disability. Turbo tax 2011 A leased employee who has provided services to you on a substantially full-time basis for at least a year if the services are performed under your primary direction or control. Turbo tax 2011 A partner who performs services for a partnership. Turbo tax 2011 De Minimis (Minimal) Benefits You can exclude the value of a de minimis benefit you provide to an employee from the employee's wages. Turbo tax 2011 A de minimis benefit is any property or service you provide to an employee that has so little value (taking into account how frequently you provide similar benefits to your employees) that accounting for it would be unreasonable or administratively impracticable. Turbo tax 2011 Cash and cash equivalent fringe benefits (for example, use of gift card, charge card, or credit card), no matter how little, are never excludable as a de minimis benefit, except for occasional meal money or transportation fare. Turbo tax 2011 Examples of de minimis benefits include the following. Turbo tax 2011 Personal use of an employer-provided cell phone provided primarily for noncompensatory business purposes. Turbo tax 2011 See Employer-Provided Cell Phones , later in this section, for details. Turbo tax 2011 Occasional personal use of a company copying machine if you sufficiently control its use so that at least 85% of its use is for business purposes. Turbo tax 2011 Holiday gifts, other than cash, with a low fair market value. Turbo tax 2011 Group-term life insurance payable on the death of an employee's spouse or dependent if the face amount is not more than $2,000. Turbo tax 2011 Meals. Turbo tax 2011 See Meals , later in this section, for details. Turbo tax 2011 Occasional parties or picnics for employees and their guests. Turbo tax 2011 Occasional tickets for theater or sporting events. Turbo tax 2011 Transportation fare. Turbo tax 2011 See Transportation (Commuting) Benefits , later in this section, for details. Turbo tax 2011 Employee. Turbo tax 2011   For this exclusion, treat any recipient of a de minimis benefit as an employee. Turbo tax 2011 Dependent Care Assistance This exclusion applies to household and dependent care services you directly or indirectly pay for or provide to an employee under a dependent care assistance program that covers only your employees. Turbo tax 2011 The services must be for a qualifying person's care and must be provided to allow the employee to work. Turbo tax 2011 These requirements are basically the same as the tests the employee would have to meet to claim the dependent care credit if the employee paid for the services. Turbo tax 2011 For more information, see Qualifying Person Test and Work-Related Expense Test in Publication 503, Child and Dependent Care Expenses. Turbo tax 2011 Employee. Turbo tax 2011   For this exclusion, treat the following individuals as employees. Turbo tax 2011 A current employee. Turbo tax 2011 A leased employee who has provided services to you on a substantially full-time basis for at least a year if the services are performed under your primary direction or control. Turbo tax 2011 Yourself (if you are a sole proprietor). Turbo tax 2011 A partner who performs services for a partnership. Turbo tax 2011 Exclusion from wages. Turbo tax 2011   You can exclude the value of benefits you provide to an employee under a dependent care assistance program from the employee's wages if you reasonably believe that the employee can exclude the benefits from gross income. Turbo tax 2011   An employee can generally exclude from gross income up to $5,000 of benefits received under a dependent care assistance program each year. Turbo tax 2011 This limit is reduced to $2,500 for married employees filing separate returns. Turbo tax 2011   However, the exclusion cannot be more than the smaller of the earned income of either the employee or employee's spouse. Turbo tax 2011 Special rules apply to determine the earned income of a spouse who is either a student or not able to care for himself or herself. Turbo tax 2011 For more information on the earned income limit, see Publication 503. Turbo tax 2011 Exception for highly compensated employees. Turbo tax 2011   You cannot exclude dependent care assistance from the wages of a highly compensated employee unless the benefits provided under the program do not favor highly compensated employees and the program meets the requirements described in section 129(d) of the Internal Revenue Code. Turbo tax 2011   For this exclusion, a highly compensated employee for 2014 is an employee who meets either of the following tests. Turbo tax 2011 The employee was a 5% owner at any time during the year or the preceding year. Turbo tax 2011 The employee received more than $115,000 in pay for the preceding year. Turbo tax 2011 You can choose to ignore test (2) if the employee was not also in the top 20% of employees when ranked by pay for the preceding year. Turbo tax 2011 Form W-2. Turbo tax 2011   Report the value of all dependent care assistance you provide to an employee under a dependent care assistance program in box 10 of the employee's Form W-2. Turbo tax 2011 Include any amounts you cannot exclude from the employee's wages in boxes 1, 3, and 5. Turbo tax 2011 Report both the nontaxable portion of assistance (up to $5,000) and any assistance above the amount that is non-taxable to the employee. Turbo tax 2011 Example. Turbo tax 2011   Company A provides a dependent care assistance flexible spending arrangement to its employees through a cafeteria plan. Turbo tax 2011 In addition, it provides occasional on-site dependent care to its employees at no cost. Turbo tax 2011 Emily, an employee of company A, had $4,500 deducted from her pay for the dependent care flexible spending arrangement. Turbo tax 2011 In addition, Emily used the on-site dependent care several times. Turbo tax 2011 The fair market value of the on-site care was $700. Turbo tax 2011 Emily's Form W-2 should report $5,200 of dependent care assistance in box 10 ($4,500 flexible spending arrangement plus $700 on-site dependent care). Turbo tax 2011 Boxes 1, 3, and 5 should include $200 (the amount in excess of the nontaxable assistance), and applicable taxes should be withheld on that amount. Turbo tax 2011 Educational Assistance This exclusion applies to educational assistance you provide to employees under an educational assistance program. Turbo tax 2011 The exclusion also applies to graduate level courses. Turbo tax 2011 Educational assistance means amounts you pay or incur for your employees' education expenses. Turbo tax 2011 These expenses generally include the cost of books, equipment, fees, supplies, and tuition. Turbo tax 2011 However, these expenses do not include the cost of a course or other education involving sports, games, or hobbies, unless the education: Has a reasonable relationship to your business, or Is required as part of a degree program. Turbo tax 2011 Education expenses do not include the cost of tools or supplies (other than textbooks) your employee is allowed to keep at the end of the course. Turbo tax 2011 Nor do they include the cost of lodging, meals, or transportation. Turbo tax 2011 Educational assistance program. Turbo tax 2011   An educational assistance program is a separate written plan that provides educational assistance only to your employees. Turbo tax 2011 The program qualifies only if all of the following tests are met. Turbo tax 2011 The program benefits employees who qualify under rules set up by you that do not favor highly compensated employees. Turbo tax 2011 To determine whether your program meets this test, do not consider employees excluded from your program who are covered by a collective bargaining agreement if there is evidence that educational assistance was a subject of good-faith bargaining. Turbo tax 2011 The program does not provide more than 5% of its benefits during the year for shareholders or owners. Turbo tax 2011 A shareholder or owner is someone who owns (on any day of the year) more than 5% of the stock or of the capital or profits interest of your business. Turbo tax 2011 The program does not allow employees to choose to receive cash or other benefits that must be included in gross income instead of educational assistance. Turbo tax 2011 You give reasonable notice of the program to eligible employees. Turbo tax 2011 Your program can cover former employees if their employment is the reason for the coverage. Turbo tax 2011   For this exclusion, a highly compensated employee for 2014 is an employee who meets either of the following tests. Turbo tax 2011 The employee was a 5% owner at any time during the year or the preceding year. Turbo tax 2011 The employee received more than $115,000 in pay for the preceding year. Turbo tax 2011 You can choose to ignore test (2) if the employee was not also in the top 20% of employees when ranked by pay for the preceding year. Turbo tax 2011 Employee. Turbo tax 2011   For this exclusion, treat the following individuals as employees. Turbo tax 2011 A current employee. Turbo tax 2011 A former employee who retired, left on disability, or was laid off. Turbo tax 2011 A leased employee who has provided services to you on a substantially full-time basis for at least a year if the services are performed under your primary direction or control. Turbo tax 2011 Yourself (if you are a sole proprietor). Turbo tax 2011 A partner who performs services for a partnership. Turbo tax 2011 Exclusion from wages. Turbo tax 2011   You can exclude up to $5,250 of educational assistance you provide to an employee under an educational assistance program from the employee's wages each year. Turbo tax 2011 Assistance over $5,250. Turbo tax 2011   If you do not have an educational assistance plan, or you provide an employee with assistance exceeding $5,250, you must include the value of these benefits as wages, unless the benefits are working condition benefits. Turbo tax 2011 Working condition benefits may be excluded from wages. Turbo tax 2011 Property or a service provided is a working condition benefit to the extent that if the employee paid for it, the amount paid would have been deductible as a business or depreciation expense. Turbo tax 2011 See Working Condition Benefits , later, in this section. Turbo tax 2011 Employee Discounts This exclusion applies to a price reduction you give an employee on property or services you offer to customers in the ordinary course of the line of business in which the employee performs substantial services. Turbo tax 2011 However, it does not apply to discounts on real property or discounts on personal property of a kind commonly held for investment (such as stocks or bonds). Turbo tax 2011 Employee. Turbo tax 2011   For this exclusion, treat the following individuals as employees. Turbo tax 2011 A current employee. Turbo tax 2011 A former employee who retired or left on disability. Turbo tax 2011 A widow or widower of an individual who died while an employee. Turbo tax 2011 A widow or widower of an employee who retired or left on disability. Turbo tax 2011 A leased employee who has provided services to you on a substantially full-time basis for at least a year if the services are performed under your primary direction or control. Turbo tax 2011 A partner who performs services for a partnership. Turbo tax 2011 Exclusion from wages. Turbo tax 2011   You can generally exclude the value of an employee discount you provide an employee from the employee's wages, up to the following limits. Turbo tax 2011 For a discount on services, 20% of the price you charge nonemployee customers for the service. Turbo tax 2011 For a discount on merchandise or other property, your gross profit percentage times the price you charge nonemployee customers for the property. Turbo tax 2011   Determine your gross profit percentage in the line of business based on all property you offer to customers (including employee customers) and your experience during the tax year immediately before the tax year in which the discount is available. Turbo tax 2011 To figure your gross profit percentage, subtract the total cost of the property from the total sales price of the property and divide the result by the total sales price of the property. Turbo tax 2011 Exception for highly compensated employees. Turbo tax 2011   You cannot exclude from the wages of a highly compensated employee any part of the value of a discount that is not available on the same terms to one of the following groups. Turbo tax 2011 All of your employees. Turbo tax 2011 A group of employees defined under a reasonable classification you set up that does not favor highly compensated employees. Turbo tax 2011   For this exclusion, a highly compensated employee for 2014 is an employee who meets either of the following tests. Turbo tax 2011 The employee was a 5% owner at any time during the year or the preceding year. Turbo tax 2011 The employee received more than $115,000 in pay for the preceding year. Turbo tax 2011 You can choose to ignore test (2) if the employee was not also in the top 20% of employees when ranked by pay for the preceding year. Turbo tax 2011 Employee Stock Options There are three kinds of stock options—incentive stock options, employee stock purchase plan options, and nonstatutory (nonqualified) stock options. Turbo tax 2011 Wages for social security, Medicare, and federal unemployment (FUTA) taxes do not include remuneration resulting from the exercise, after October 22, 2004, of an incentive stock option or under an employee stock purchase plan option, or from any disposition of stock acquired by exercising such an option. Turbo tax 2011 The IRS will not apply these taxes to an exercise before October 23, 2004, of an incentive stock option or an employee stock purchase plan option or to a disposition of stock acquired by such exercise. Turbo tax 2011 Additionally, federal income tax withholding is not required on the income resulting from a disqualifying disposition of stock acquired by the exercise after October 22, 2004, of an incentive stock option or under an employee stock purchase plan option, or on income equal to the discount portion of stock acquired by the exercise, after October 22, 2004, of an employee stock purchase plan option resulting from any disposition of the stock. Turbo tax 2011 The IRS will not apply federal income tax withholding upon the disposition of stock acquired by the exercise, before October 23, 2004, of an incentive stock option or an employee stock purchase plan option. Turbo tax 2011 However, the employer must report as income in box 1 of Form W-2, (a) the discount portion of stock acquired by the exercise of an employee stock purchase plan option upon disposition of the stock, and (b) the spread (between the exercise price and the fair market value of the stock at the time of exercise) upon a disqualifying disposition of stock acquired by the exercise of an incentive stock option or an employee stock purchase plan option. Turbo tax 2011 An employer must report the excess of the fair market value of stock received upon exercise of a nonstatutory stock option over the amount paid for the stock option on Form W-2 in boxes 1, 3 (up to the social security wage base), 5, and in box 12 using the code “V. Turbo tax 2011 ” See Regulations section 1. Turbo tax 2011 83-7. Turbo tax 2011 An employee who transfers his or her interest in nonstatutory stock options to the employee's former spouse incident to a divorce is not required to include an amount in gross income upon the transfer. Turbo tax 2011 The former spouse, rather than the employee, is required to include an amount in gross income when the former spouse exercises the stock options. Turbo tax 2011 See Revenue Ruling 2002-22 and Revenue Ruling 2004-60 for details. Turbo tax 2011 You can find Revenue Ruling 2002-22 on page 849 of Internal Revenue Bulletin 2002-19 at www. Turbo tax 2011 irs. Turbo tax 2011 gov/pub/irs-irbs/irb02-19. Turbo tax 2011 pdf. Turbo tax 2011 See Revenue Ruling 2004-60, 2004-24 I. Turbo tax 2011 R. Turbo tax 2011 B. Turbo tax 2011 1051, available at www. Turbo tax 2011 irs. Turbo tax 2011 gov/irb/2004-24_IRB/ar13. Turbo tax 2011 html. Turbo tax 2011 For more information about employee stock options, see sections 421, 422, and 423 of the Internal Revenue Code and their related regulations. Turbo tax 2011 Employer-Provided Cell Phones The value of an employer-provided cell phone, provided primarily for noncompensatory business reasons, is excludable from an employee's income as a working condition fringe benefit. Turbo tax 2011 Personal use of an employer-provided cell phone, provided primarily for noncompensatory business reasons, is excludable from an employee's income as a de minimis fringe benefit. Turbo tax 2011 For the rules relating to these types of benefits, see De Minimis (Minimal) Benefits , earlier in this section, and Working Condition Benefits , later in this section. Turbo tax 2011 Noncompensatory business purposes. Turbo tax 2011   You provide a cell phone primarily for noncompensatory business purposes if there are substantial business reasons for providing the cell phone. Turbo tax 2011 Examples of substantial business reasons include the employer's: Need to contact the employee at all times for work-related emergencies, Requirement that the employee be available to speak with clients at times when the employee is away from the office, and Need to speak with clients located in other time zones at times outside the employee's normal workday. Turbo tax 2011 Cell phones provided to promote goodwill, boost morale, or attract prospective employees. Turbo tax 2011   You cannot exclude from an employee's wages the value of a cell phone provided to promote goodwill of an employee, to attract a prospective employee, or as a means of providing additional compensation to an employee. Turbo tax 2011 Additional information. Turbo tax 2011   For additional information on the tax treatment of employer-provided cell phones, see Notice 2011-72, 2011-38 I. Turbo tax 2011 R. Turbo tax 2011 B. Turbo tax 2011 407, available at  www. Turbo tax 2011 irs. Turbo tax 2011 gov/irb/2011-38_IRB/ar07. Turbo tax 2011 html. Turbo tax 2011 Group-Term Life Insurance Coverage This exclusion applies to life insurance coverage that meets all the following conditions. Turbo tax 2011 It provides a general death benefit that is not included in income. Turbo tax 2011 You provide it to a group of employees. Turbo tax 2011 See The 10-employee rule , later. Turbo tax 2011 It provides an amount of insurance to each employee based on a formula that prevents individual selection. Turbo tax 2011 This formula must use factors such as the employee's age, years of service, pay, or position. Turbo tax 2011 You provide it under a policy you directly or indirectly carry. Turbo tax 2011 Even if you do not pay any of the policy's cost, you are considered to carry it if you arrange for payment of its cost by your employees and charge at least one employee less than, and at least one other employee more than, the cost of his or her insurance. Turbo tax 2011 Determine the cost of the insurance, for this purpose, as explained under Coverage over the limit , later. Turbo tax 2011 Group-term life insurance does not include the following insurance. Turbo tax 2011 Insurance that does not provide general death benefits, such as travel insurance or a policy providing only accidental death benefits. Turbo tax 2011 Life insurance on the life of your employee's spouse or dependent. Turbo tax 2011 However, you may be able to exclude the cost of this insurance from the employee's wages as a de minimis benefit. Turbo tax 2011 See De Minimis (Minimal) Benefits , earlier in this section. Turbo tax 2011 Insurance provided under a policy that provides a permanent benefit (an economic value that extends beyond 1 policy year, such as paid-up or cash surrender value), unless certain requirements are met. Turbo tax 2011 See Regulations section 1. Turbo tax 2011 79-1 for details. Turbo tax 2011 Employee. Turbo tax 2011   For this exclusion, treat the following individuals as employees. Turbo tax 2011 A current common-law employee. Turbo tax 2011 A full-time life insurance agent who is a current statutory employee. Turbo tax 2011 An individual who was formerly your employee under (1) or (2). Turbo tax 2011 A leased employee who has provided services to you on a substantially full-time basis for at least a year if the services are performed under your primary direction and control. Turbo tax 2011 Exception for S corporation shareholders. Turbo tax 2011   Do not treat a 2% shareholder of an S corporation as an employee of the corporation for this purpose. Turbo tax 2011 A 2% shareholder is someone who directly or indirectly owns (at any time during the year) more than 2% of the corporation's stock or stock with more than 2% of the voting power. Turbo tax 2011 Treat a 2% shareholder as you would a partner in a partnership for fringe benefit purposes, but do not treat the benefit as a reduction in distributions to the 2% shareholder. Turbo tax 2011 The 10-employee rule. Turbo tax 2011   Generally, life insurance is not group-term life insurance unless you provide it to at least 10 full-time employees at some time during the year. Turbo tax 2011   For this rule, count employees who choose not to receive the insurance unless, to receive it, they must contribute to the cost of benefits other than the group-term life insurance. Turbo tax 2011 For example, count an employee who could receive insurance by paying part of the cost, even if that employee chooses not to receive it. Turbo tax 2011 However, do not count an employee who must pay part or all of the cost of permanent benefits to get insurance, unless that employee chooses to receive it. Turbo tax 2011 A permanent benefit is an economic value extending beyond one policy year (for example, a paid-up or cash-surrender value) that is provided under a life insurance policy. Turbo tax 2011 Exceptions. Turbo tax 2011   Even if you do not meet the 10-employee rule, two exceptions allow you to treat insurance as group-term life insurance. Turbo tax 2011   Under the first exception, you do not have to meet the 10-employee rule if all the following conditions are met. Turbo tax 2011 If evidence that the employee is insurable is required, it is limited to a medical questionnaire (completed by the employee) that does not require a physical. Turbo tax 2011 You provide the insurance to all your full-time employees or, if the insurer requires the evidence mentioned in (1), to all full-time employees who provide evidence the insurer accepts. Turbo tax 2011 You figure the coverage based on either a uniform percentage of pay or the insurer's coverage brackets that meet certain requirements. Turbo tax 2011 See Regulations section 1. Turbo tax 2011 79-1 for details. Turbo tax 2011   Under the second exception, you do not have to meet the 10-employee rule if all the following conditions are met. Turbo tax 2011 You provide the insurance under a common plan covering your employees and the employees of at least one other employer who is not related to you. Turbo tax 2011 The insurance is restricted to, but mandatory for, all your employees who belong to, or are represented by, an organization (such as a union) that carries on substantial activities besides obtaining insurance. Turbo tax 2011 Evidence of whether an employee is insurable does not affect an employee's eligibility for insurance or the amount of insurance that employee gets. Turbo tax 2011   To apply either exception, do not consider employees who were denied insurance for any of the following reasons. Turbo tax 2011 They were 65 or older. Turbo tax 2011 They customarily work 20 hours or less a week or 5 months or less in a calendar year. Turbo tax 2011 They have not been employed for the waiting period given in the policy. Turbo tax 2011 This waiting period cannot be more than 6 months. Turbo tax 2011 Exclusion from wages. Turbo tax 2011   You can generally exclude the cost of up to $50,000 of group-term life insurance from the wages of an insured employee. Turbo tax 2011 You can exclude the same amount from the employee's wages when figuring social security and Medicare taxes. Turbo tax 2011 In addition, you do not have to withhold federal income tax or pay FUTA tax on any group-term life insurance you provide to an employee. Turbo tax 2011 Coverage over the limit. Turbo tax 2011   You must include in your employee's wages the cost of group-term life insurance beyond $50,000 worth of coverage, reduced by the amount the employee paid toward the insurance. Turbo tax 2011 Report it as wages in boxes 1, 3, and 5 of the employee's Form W-2. Turbo tax 2011 Also, show it in box 12 with code “C. Turbo tax 2011 ” The amount is subject to social security and Medicare taxes, and you may, at your option, withhold federal income tax. Turbo tax 2011   Figure the monthly cost of the insurance to include in the employee's wages by multiplying the number of thousands of dollars of all insurance coverage over $50,000 (figured to the nearest $100) by the cost shown in Table 2-2. Turbo tax 2011 For all coverage provided within the calendar year, use the employee's age on the last day of the employee's tax year. Turbo tax 2011 You must prorate the cost from the table if less than a full month of coverage is involved. Turbo tax 2011 Table 2-2. Turbo tax 2011 Cost Per $1,000 of Protection For 1 Month Age Cost Under 25 $ . Turbo tax 2011 05 25 through 29 . Turbo tax 2011 06 30 through 34 . Turbo tax 2011 08 35 through 39 . Turbo tax 2011 09 40 through 44 . Turbo tax 2011 10 45 through 49 . Turbo tax 2011 15 50 through 54 . Turbo tax 2011 23 55 through 59 . Turbo tax 2011 43 60 through 64 . Turbo tax 2011 66 65 through 69 1. Turbo tax 2011 27 70 and older 2. Turbo tax 2011 06 You figure the total cost to include in the employee's wages by multiplying the monthly cost by the number of full months' coverage at that cost. Turbo tax 2011 Example. Turbo tax 2011 Tom's employer provides him with group-term life insurance coverage of $200,000. Turbo tax 2011 Tom is 45 years old, is not a key employee, and pays $100 per year toward the cost of the insurance. Turbo tax 2011 Tom's employer must include $170 in his wages. Turbo tax 2011 The $200,000 of insurance coverage is reduced by $50,000. Turbo tax 2011 The yearly cost of $150,000 of coverage is $270 ($. Turbo tax 2011 15 x 150 x 12), and is reduced by the $100 Tom pays for the insurance. Turbo tax 2011 The employer includes $170 in boxes 1, 3, and 5 of Tom's Form W-2. Turbo tax 2011 The employer also enters $170 in box 12 with code “C. Turbo tax 2011 ” Coverage for dependents. Turbo tax 2011   Group-term life insurance coverage paid by the employer for the spouse or dependents of an employee may be excludable from income as a de minimis fringe benefit if the face amount is not more than $2,000. Turbo tax 2011 If the face amount is greater than $2,000, the entire cost of the dependent coverage must be included in income unless the amount over $2,000 is purchased with employee contributions on an after-tax basis. Turbo tax 2011 The cost of the insurance is determined by using Table 2-2. Turbo tax 2011 Former employees. Turbo tax 2011   When group-term life insurance over $50,000 is provided to an employee (including retirees) after his or her termination, the employee share of social security and Medicare taxes on that period of coverage is paid by the former employee with his or her tax return and is not collected by the employer. Turbo tax 2011 You are not required to collect those taxes. Turbo tax 2011 Use the table above to determine the amount of social security and Medicare taxes owed by the former employee for coverage provided after separation from service. Turbo tax 2011 Report those uncollected amounts separately in box 12 of Form W-2 using codes “M” and “N. Turbo tax 2011 ” See the General Instructions for Forms W-2 and W-3 and the Instructions for Form 941. Turbo tax 2011 Exception for key employees. Turbo tax 2011   Generally, if your group-term life insurance plan favors key employees as to participation or benefits, you must include the entire cost of the insurance in your key employees' wages. Turbo tax 2011 This exception generally does not apply to church plans. Turbo tax 2011 When figuring social security and Medicare taxes, you must also include the entire cost in the employees' wages. Turbo tax 2011 Include the cost in boxes 1, 3, and 5 of Form W-2. Turbo tax 2011 However, you do not have to withhold federal income tax or pay FUTA tax on the cost of any group-term life insurance you provide to an employee. Turbo tax 2011   For this purpose, the cost of the insurance is the greater of the following amounts. Turbo tax 2011 The premiums you pay for the employee's insurance. Turbo tax 2011 See Regulations section 1. Turbo tax 2011 79-4T(Q&A 6) for more information. Turbo tax 2011 The cost you figure using Table 2-2. Turbo tax 2011   For this exclusion, a key employee during 2014 is an employee or former employee who is one of the following individuals. Turbo tax 2011 See section 416(i) of the Internal Revenue Code for more information. Turbo tax 2011 An officer having annual pay of more than $170,000. Turbo tax 2011 An individual who for 2014 was either of the following. Turbo tax 2011 A 5% owner of your business. Turbo tax 2011 A 1% owner of your business whose annual pay was more than $150,000. Turbo tax 2011   A former employee who was a key employee upon retirement or separation from service is also a key employee. Turbo tax 2011   Your plan does not favor key employees as to participation if at least one of the following is true. Turbo tax 2011 It benefits at least 70% of your employees. Turbo tax 2011 At least 85% of the participating employees are not key employees. Turbo tax 2011 It benefits employees who qualify under a set of rules you set up that do not favor key employees. Turbo tax 2011   Your plan meets this participation test if it is part of a cafeteria plan (discussed in section 1) and it meets the participation test for those plans. Turbo tax 2011   When applying this test, do not consider employees who: Have not completed 3 years of service, Are part-time or seasonal, Are nonresident aliens who receive no U. Turbo tax 2011 S. Turbo tax 2011 source earned income from you, or Are not included in the plan but are in a unit of employees covered by a collective bargaining agreement, if the benefits provided under the plan were the subject of good-faith bargaining between you and employee representatives. Turbo tax 2011   Your plan does not favor key employees as to benefits if all benefits available to participating key employees are also available to all other participating employees. Turbo tax 2011 Your plan does not favor key employees just because the amount of insurance you provide to your employees is uniformly related to their pay. Turbo tax 2011 S corporation shareholders. Turbo tax 2011   Because you cannot treat a 2% shareholder of an S corporation as an employee for this exclusion, you must include the cost of all group-term life insurance coverage you provide the 2% shareholder in his or her wages. Turbo tax 2011 When figuring social security and Medicare taxes, you must also include the cost of this coverage in the 2% shareholder's wages. Turbo tax 2011 Include the cost in boxes 1, 3, and 5 of Form W-2. Turbo tax 2011 However, you do not have to withhold federal income tax or pay federal unemployment tax on the cost of any group-term life insurance coverage you provide to the 2% shareholder. Turbo tax 2011 Health Savings Accounts A Health Savings Account (HSA) is an account owned by a qualified individual who is generally your employee or former employee. Turbo tax 2011 Any contributions that you make to an HSA become the employee's property and cannot be withdrawn by you. Turbo tax 2011 Contributions to the account are used to pay current or future medical expenses of the account owner, his or her spouse, and any qualified dependent. Turbo tax 2011 The medical expenses must not be reimbursable by insurance or other sources and their payment from HSA funds (distribution) will not give rise to a medical expense deduction on the individual's federal income tax return. Turbo tax 2011 For more information about HSAs, visit the Department of Treasury's website at www. Turbo tax 2011 treasury. Turbo tax 2011 gov and enter “HSA” in the search box. Turbo tax 2011 Eligibility. Turbo tax 2011   A qualified individual must be covered by a High Deductible Health Plan (HDHP) and not be covered by other health insurance except for permitted insurance listed under section 223(c)(3) or insurance for accidents, disability, dental care, vision care, or long-term care. Turbo tax 2011 For calendar year 2014, a qualifying HDHP must have a deductible of at least $1,250 for self-only coverage or $2,500 for family coverage and must limit annual out-of-pocket expenses of the beneficiary to $6,350 for self-only coverage and $12,700 for family coverage. Turbo tax 2011   There are no income limits that restrict an individual's eligibility to contribute to an HSA nor is there a requirement that the account owner have earned income to make a contribution. Turbo tax 2011 Exceptions. Turbo tax 2011   An individual is not a qualified individual if he or she can be claimed as a dependent on another person's tax return. Turbo tax 2011 Also, an employee's participation in a health flexible spending arrangement (FSA) or health reimbursement arrangement (HRA) generally disqualifies the individual (and employer) from making contributions to his or her HSA. Turbo tax 2011 However, an individual may qualify to participate in an HSA if he or she is participating in only a limited-purpose FSA or HRA or a post-deductible FSA. Turbo tax 2011 For more information, see Other employee health plans in Publication 969. Turbo tax 2011 Employer contributions. Turbo tax 2011   Up to specified dollar limits, cash contributions to the HSA of a qualified individual (determined monthly) are exempt from federal income tax withholding, social security tax, Medicare tax, and FUTA tax. Turbo tax 2011 For 2014, you can contribute up to $3,300 for self-only coverage or $6,550 for family coverage to a qualified individual's HSA. Turbo tax 2011   The contribution amounts listed above are increased by $1,000 for a qualified individual who is age 55 or older at any time during the year. Turbo tax 2011 For two qualified individuals who are married to each other and who each are age 55 or older at any time during the year, each spouse's contribution limit is increased by $1,000 provided each spouse has a separate HSA. Turbo tax 2011 No contributions can be made to an individual's HSA after he or she becomes enrolled in Medicare Part A or Part B. Turbo tax 2011 Nondiscrimination rules. Turbo tax 2011    Your contribution amount to an employee's HSA must be comparable for all employees who have comparable coverage during the same period. Turbo tax 2011 Otherwise, there will be an excise tax equal to 35% of the amount you contributed to all employees' HSAs. Turbo tax 2011   For guidance on employer comparable contributions to HSAs under section 4980G in instances where an employee has not established an HSA by December 31 and in instances where an employer accelerates contributions for the calendar year for employees who have incurred qualified medical expenses, see Regulations section 54. Turbo tax 2011 4980G-4. Turbo tax 2011 Exception. Turbo tax 2011   The Tax Relief and Health Care Act of 2006 allows employers to make larger HSA contributions for a nonhighly compensated employee than for a highly compensated employee. Turbo tax 2011 A highly compensated employee for 2014 is an employee who meets either of the following tests. Turbo tax 2011 The employee was a 5% owner at any time during the year or the preceding year. Turbo tax 2011 The employee received more than $115,000 in pay for the preceding year. Turbo tax 2011 You can choose to ignore test (2) if the employee was not also in the top 20% of employees when ranked by pay for the preceding year. Turbo tax 2011 Partnerships and S corporations. Turbo tax 2011   Partners and 2% shareholders of an S corporation are not eligible for salary reduction (pre-tax) contributions to an HSA. Turbo tax 2011 Employer contributions to the HSA of a bona fide partner or 2% shareholder are treated as distributions or guaranteed payments as determined by the facts and circumstances. Turbo tax 2011 Cafeteria plans. Turbo tax 2011   You may contribute to an employee's HSA using a cafeteria plan and your contributions are not subject to the statutory comparability rules. Turbo tax 2011 However, cafeteria plan nondiscrimination rules still apply. Turbo tax 2011 For example, contributions under a cafeteria plan to employee HSAs cannot be greater for higher-paid employees than they are for lower-paid employees. Turbo tax 2011 Contributions that favor lower-paid employees are not prohibited. Turbo tax 2011 Reporting requirements. Turbo tax 2011   You must report your contributions to an employee's HSA in box 12 of Form W-2 using code “W. Turbo tax 2011 ” The trustee or custodian of the HSA, generally a bank or insurance company, reports distributions from the HSA using Form 1099-SA, Distributions From an HSA, Archer MSA, or Medicare Advantage MSA. Turbo tax 2011 Lodging on Your Business Premises You can exclude the value of lodging you furnish to an employee from the employee's wages if it meets the following tests. Turbo tax 2011 It is furnished on your business premises. Turbo tax 2011 It is furnished for your convenience. Turbo tax 2011 The employee must accept it as a condition of employment. Turbo tax 2011 Different tests may apply to lodging furnished by educational institutions. Turbo tax 2011 See section 119(d) of the Internal Revenue Code for details. Turbo tax 2011 The exclusion does not apply if you allow your employee to choose to receive additional pay instead of lodging. Turbo tax 2011 On your business premises. Turbo tax 2011   For this exclusion, your business premises is generally your employee's place of work. Turbo tax 2011 For special rules that apply to lodging furnished in a camp located in a foreign country, see section 119(c) of the Internal Revenue Code and its regulations. Turbo tax 2011 For your convenience. Turbo tax 2011   Whether or not you furnish lodging for your convenience as an employer depends on all the facts and circumstances. Turbo tax 2011 You furnish the lodging to your employee for your convenience if you do this for a substantial business reason other than to provide the employee with additional pay. Turbo tax 2011 This is true even if a law or an employment contract provides that the lodging is furnished as pay. Turbo tax 2011 However, a written statement that the lodging is furnished for your convenience is not sufficient. Turbo tax 2011 Condition of employment. Turbo tax 2011   Lodging meets this test if you require your employees to accept the lodging because they need to live on your business premises to be able to properly perform their duties. Turbo tax 2011 Examples include employees who must be available at all times and employees who could not perform their required duties without being furnished the lodging. Turbo tax 2011   It does not matter whether you must furnish the lodging as pay under the terms of an employment contract or a law fixing the terms of employment. Turbo tax 2011 Example. Turbo tax 2011 A hospital gives Joan, an employee of the hospital, the choice of living at the hospital free of charge or living elsewhere and receiving a cash allowance in addition to her regular salary. Turbo tax 2011 If Joan chooses to live at the hospital, the hospital cannot exclude the value of the lodging from her wages because she is not required to live at the hospital to properly perform the duties of her employment. Turbo tax 2011 S corporation shareholders. Turbo tax 2011   For this exclusion, do not treat a 2% shareholder of an S corporation as an employee of the corporation. Turbo tax 2011 A 2% shareholder is someone who directly or indirectly owns (at any time during the year) more than 2% of the corporation's stock or stock with more than 2% of the voting power. Turbo tax 2011 Treat a 2% shareholder as you would a partner in a partnership for fringe benefit purposes, but do not treat the benefit as a reduction in distributions to the 2% shareholder. Turbo tax 2011 Meals This section discusses the exclusion rules that apply to de minimis meals and meals on your business premises. Turbo tax 2011 De Minimis Meals You can exclude any occasional meal or meal money you provide to an employee if it has so little value (taking into account how frequently you provide meals to your employees) that accounting for it would be unreasonable or administratively impracticable. Turbo tax 2011 The exclusion applies, for example, to the following items. Turbo tax 2011 Coffee, doughnuts, or soft drinks. Turbo tax 2011 Occasional meals or meal money provided to enable an employee to work overtime. Turbo tax 2011 However, the exclusion does not apply to meal money figured on the basis of hours worked. Turbo tax 2011 Occasional parties or picnics for employees and their guests. Turbo tax 2011 This exclusion also applies to meals you provide at an employer-operated eating facility for employees if the annual revenue from the facility equals or exceeds the direct costs of the facility. Turbo tax 2011 For this purpose, your revenue from providing a meal is considered equal to the facility's direct operating costs to provide that meal if its value can be excluded from an employee's wages as explained under Meals on Your Business Premises , later. Turbo tax 2011 If food or beverages you furnish to employees qualify as a de minimis benefit, you can deduct their full cost. Turbo tax 2011 The 50% limit on deductions for the cost of meals does not apply. Turbo tax 2011 The deduction limit on meals is discussed in chapter 2 of Publication 535. Turbo tax 2011 Employee. Turbo tax 2011   For this exclusion, treat any recipient of a de minimis meal as
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The Turbo Tax 2011

Turbo tax 2011 5. Turbo tax 2011   Manufacturers Taxes Table of Contents Importer. Turbo tax 2011 Use considered sale. Turbo tax 2011 Lease considered sale. Turbo tax 2011 Bonus goods. Turbo tax 2011 Taxable Event ExemptionsRequirements for Exempt Sales Credits or Refunds Sport Fishing EquipmentRelated person. Turbo tax 2011 Bows, Quivers, Broadheads, and Points Arrow ShaftsExemption for certain wooden arrows. Turbo tax 2011 CoalExported. Turbo tax 2011 Taxable TiresQualifying intercity or local bus. Turbo tax 2011 Qualifying school bus. Turbo tax 2011 Gas Guzzler TaxVehicles not subject to tax. Turbo tax 2011 Imported automobiles. Turbo tax 2011 VaccinesConditions to allowance. Turbo tax 2011 Taxable Medical Devices The following discussion of manufacturers taxes applies to the tax on: Sport fishing equipment; Fishing rods and fishing poles; Electric outboard motors; Fishing tackle boxes; Bows, quivers, broadheads, and points; Arrow shafts; Coal; Taxable tires; Gas guzzler automobiles; and Vaccines. Turbo tax 2011 Manufacturer. Turbo tax 2011   The term “manufacturer” includes a producer or importer. Turbo tax 2011 A manufacturer is any person who produces a taxable article from new or raw material, or from scrap, salvage, or junk material, by processing or changing the form of an article or by combining or assembling two or more articles. Turbo tax 2011 If you furnish the materials and keep title to those materials and to the finished article, you are considered the manufacturer even though another person actually manufactures the taxable article. Turbo tax 2011   A manufacturer who sells a taxable article in knockdown (unassembled) condition is liable for the tax. Turbo tax 2011 The person who buys these component parts and assembles a taxable article may also be liable for tax as a further manufacturer depending on the labor, material, and overhead required to assemble the completed article if the article is assembled for business use. Turbo tax 2011 Importer. Turbo tax 2011   An importer is a person who brings a taxable article into the United States, or withdraws a taxable article from a customs bonded warehouse for sale or use in the United States. Turbo tax 2011 Sale. Turbo tax 2011   A sale is the transfer of the title to, or the substantial incidents of ownership in, an article to a buyer for consideration that may consist of money, services, or other things. Turbo tax 2011 Use considered sale. Turbo tax 2011   A manufacturer who uses a taxable article is liable for the tax in the same manner as if it were sold. Turbo tax 2011 Lease considered sale. Turbo tax 2011   The lease of an article (including any renewal or extension of the lease) by the manufacturer is generally considered a taxable sale. Turbo tax 2011 However, for the gas guzzler tax, only the first lease (excluding any renewal or extension) of the automobile by the manufacturer is considered a sale. Turbo tax 2011 Manufacturers taxes based on sale price. Turbo tax 2011   The manufacturers taxes imposed on the sale of sport fishing equipment, electric outboard motors, and bows are based on the sale price of the article. Turbo tax 2011 The taxes imposed on coal are based either on the sale price or the weight. Turbo tax 2011   The price for which an article is sold includes the total consideration paid for the article, whether that consideration is in the form of money, services, or other things. Turbo tax 2011 However, you include certain charges made when a taxable article is sold and you exclude others. Turbo tax 2011 To figure the price on which you base the tax, use the following rules. Turbo tax 2011 Include both the following charges in the price. Turbo tax 2011 Any charge for coverings or containers (regardless of their nature). Turbo tax 2011 Any charge incident to placing the article in a condition packed ready for shipment. Turbo tax 2011 Exclude all the following amounts from the price. Turbo tax 2011 The manufacturers excise tax, whether or not it is stated as a separate charge. Turbo tax 2011 The transportation charges pursuant to the sale. Turbo tax 2011 The cost of transportation of goods to a warehouse before their bona fide sale is not excludable. Turbo tax 2011 Delivery, insurance, installation, retail dealer preparation charges, and other charges you incur in placing the article in the hands of the purchaser under a bona fide sale. Turbo tax 2011 Discounts, rebates, and similar allowances actually granted to the purchaser. Turbo tax 2011 Local advertising charges. Turbo tax 2011 A charge made separately when the article is sold and that qualifies as a charge for “local advertising” may, within certain limits, be excluded from the sale price. Turbo tax 2011 Charges for warranty paid at the purchaser's option. Turbo tax 2011 However, a charge for a warranty of an article that the manufacturer requires the purchaser to pay to obtain the article is included in the sale price on which the tax is figured. Turbo tax 2011 Bonus goods. Turbo tax 2011   Allocate the sale price if you give free nontaxable goods with the purchase of taxable merchandise. Turbo tax 2011 Figure the tax only on the sale price attributable to the taxable articles. Turbo tax 2011 Example. Turbo tax 2011 A manufacturer sells a quantity of taxable articles and gives the purchaser certain nontaxable articles as a bonus. Turbo tax 2011 The sale price of the shipment is $1,500. Turbo tax 2011 The normal sale price is $2,000: $1,500 for the taxable articles and $500 for the nontaxable articles. Turbo tax 2011 Since the taxable items represent 75% of the normal sale price, the tax is based on 75% of the actual sale price, or $1,125 (75% of $1,500). Turbo tax 2011 The remaining $375 is allocated to the nontaxable articles. Turbo tax 2011 Taxable Event Tax attaches when the title to the article sold passes from the manufacturer to the buyer. Turbo tax 2011 When the title passes depends on the intention of the parties as gathered from the contract of sale. Turbo tax 2011 In the absence of expressed intention, the legal rules of presumption followed in the jurisdiction where the sale occurs determine when title passes. Turbo tax 2011 If the taxable article is used by the manufacturer, the tax attaches at the time use begins. Turbo tax 2011 The manufacturer is liable for the tax. Turbo tax 2011 Partial payments. Turbo tax 2011   The tax applies to each partial payment received when taxable articles are: Leased, Sold conditionally, Sold on installment with chattel mortgage, or Sold on installment with title to pass in the future. Turbo tax 2011 To figure the tax, multiply the partial payment by the tax rate in effect at the time of the payment. Turbo tax 2011 Exemptions The following sales by the manufacturer are exempt from the manufacturers tax. Turbo tax 2011 Sale of an article to a state or local government for the exclusive use of the state or local government. Turbo tax 2011 This exemption does not apply to the taxes on coal, gas guzzlers, and vaccines. Turbo tax 2011 State is defined in Definitions in chapter 1. Turbo tax 2011 Sale of an article to a nonprofit educational organization for its exclusive use. Turbo tax 2011 This exemption does not apply to the taxes on coal, gas guzzlers, and vaccines. Turbo tax 2011 Nonprofit educational organization is defined under Communications Tax in chapter 4. Turbo tax 2011 Sale of an article to a qualified blood collector organization. Turbo tax 2011 This exemption does not apply to gas guzzlers, recreational equipment, and vaccines. Turbo tax 2011 Qualified blood collector organizations are defined under Communications Tax in chapter 4. Turbo tax 2011 Sale of an article for use by the purchaser as supplies for vessels. Turbo tax 2011 This exemption does not apply to the taxes on coal and vaccines. Turbo tax 2011 Supplies for vessels means ships' stores, sea stores, or legitimate equipment on vessels of war of the United States or any foreign nation, vessels employed in the fisheries or whaling business, or vessels actually engaged in foreign trade. Turbo tax 2011 Sale of an article for use by the purchaser for further manufacture, or for resale by the purchaser to a second purchaser for use by the second purchaser for further manufacture. Turbo tax 2011 This exemption does not apply to the tax on coal and tires. Turbo tax 2011 Use for further manufacture means use in the manufacture or production of an article subject to the manufacturers excise taxes. Turbo tax 2011 If you buy articles tax free and resell or use them other than in the manufacture of another article, you are liable for the tax on their resale or use just as if you had manufactured and sold them. Turbo tax 2011 Sale of an article for export or for resale by the purchaser to a second purchaser for export. Turbo tax 2011 The article may be exported to a foreign country or to a possession of the United States. Turbo tax 2011 A vaccine shipped to a possession of the United States is not considered to be exported. Turbo tax 2011 If an article is sold tax free for export and the manufacturer does not receive proof of export, described later, the manufacturer is liable for the tax. Turbo tax 2011 Sales of articles of native Indian handicraft, such as bows and arrow shafts, manufactured by Indians on reservations, in Indian schools, or under U. Turbo tax 2011 S. Turbo tax 2011 jurisdiction in Alaska. Turbo tax 2011 For tire exemptions, see section 4221(e)(2). Turbo tax 2011 Requirements for Exempt Sales The following requirements must be met for a sale to be exempt from the manufacturers tax. Turbo tax 2011 Registration requirements. Turbo tax 2011   The manufacturer, first purchaser, and second purchaser in the case of resales must be registered. Turbo tax 2011 See the Form 637 instructions for more information. Turbo tax 2011 Exceptions to registration requirements. Turbo tax 2011   Registration is not required for: State or local governments, Foreign purchasers of articles sold or resold for export, The United States, or Parties to a sale of supplies for vessels and aircraft. Turbo tax 2011 Certification requirement. Turbo tax 2011   If the purchaser is required to be registered, the purchaser must give the manufacturer its registration number and certify the exempt purpose for which the article will be used. Turbo tax 2011 The information must be in writing and may be noted on the purchase order or other document furnished by the purchaser to the seller in connection with the sale. Turbo tax 2011   For a sale to a state or local government, an exemption certificate must be signed by an officer or employee authorized by the state or local government. Turbo tax 2011 See Regulations section 48. Turbo tax 2011 4221-5(c) for the certificate requirements. Turbo tax 2011   For sales for use as supplies for vessels and aircraft, if the manufacturer and purchaser are not registered, the owner or agent of the vessel must provide an exemption certificate to the manufacturer before or at the time of sale. Turbo tax 2011 See Regulations section 48. Turbo tax 2011 4221-4(d) for the certificate requirements. Turbo tax 2011 Proof of export requirement. Turbo tax 2011   Within 6 months of the date of sale or shipment by the manufacturer, whichever is earlier, the manufacturer must receive proof of exportation. Turbo tax 2011 See Regulations section 48. Turbo tax 2011 4221-3(d) for evidence that qualifies as proof of exportation. Turbo tax 2011 Proof of resale for further manufacture requirement. Turbo tax 2011   Within 6 months of the date of sale or shipment by the manufacturer, whichever is earlier, the manufacturer must receive proof that the article has been resold for use in further manufacture. Turbo tax 2011 See Regulations section 48. Turbo tax 2011 4221-2(c) for evidence that qualifies as proof of resale. Turbo tax 2011 Information to be furnished to purchaser. Turbo tax 2011   The manufacturer must indicate to the purchaser that the articles normally would be subject to tax and are being sold tax free for an exempt purpose because the purchaser has provided the required certificate. Turbo tax 2011 Credits or Refunds The manufacturer may be eligible to obtain a credit or refund of the manufacturers tax for certain uses, sales, exports, and price readjustments. Turbo tax 2011 The claim must set forth in detail the facts upon which the claim is based. Turbo tax 2011 Uses, sales, and exports. Turbo tax 2011   A credit or refund (without interest) of the manufacturers taxes may be allowable if a tax-paid article is, by any person: Exported, Used or sold for use as supplies for vessels (except for coal and vaccines), Sold to a state or local government for its exclusive use (except for coal, gas guzzlers, and vaccines), Sold to a nonprofit educational organization for its exclusive use (except for coal, gas guzzlers, and vaccines), Sold to a qualified blood collector organization for its exclusive use (except for gas guzzlers, recreational equipment, and vaccines), or Used for further manufacture of another article subject to the manufacturers taxes (except for coal). Turbo tax 2011 Export. Turbo tax 2011   If a tax-paid article is exported, the exporter or shipper may claim a credit or refund if the manufacturer waives its right to claim the credit or refund. Turbo tax 2011 In the case of a tax-paid article used to make another taxable article, the subsequent manufacturer may claim the credit or refund. Turbo tax 2011 Price readjustments. Turbo tax 2011   In addition, a credit or refund (without interest) may be allowable for a tax-paid article for which the price is readjusted by reason of return or repossession of the article or a bona fide discount, rebate, or allowance for taxes based on price. Turbo tax 2011 Conditions to allowance. Turbo tax 2011   To claim a credit or refund in the case of export; supplies for vessels; or sales to a state or local government, nonprofit educational organization, or qualified blood collector organization; the person who paid the tax must certify on the claim that one of the following applies and that the claimant has the required supporting information. Turbo tax 2011 The claimant sold the article at a tax-excluded price. Turbo tax 2011 The person has repaid, or agreed to repay, the tax to the ultimate vendor of the article. Turbo tax 2011 The person has obtained the written consent of the ultimate vendor to make the claim. Turbo tax 2011 The ultimate vendor generally is the seller making the sale that gives rise to the overpayment of tax. Turbo tax 2011 Claim for further manufacture. Turbo tax 2011   To claim a credit or refund for further manufacture, the claimant must include a statement that contains the following. Turbo tax 2011 The name and address of the manufacturer and the date of payment. Turbo tax 2011 An identification of the article for which the credit or refund is claimed. Turbo tax 2011 The amount of tax paid on the article and the date on which it was paid. Turbo tax 2011 Information indicating that the article was used as material in the manufacture or production of, or as a component part of, a second article manufactured or produced by the manufacturer, or was sold on or in connection with, or with the sale of a second article manufactured or produced by the manufacturer. Turbo tax 2011 An identification of the second article. Turbo tax 2011   For claims by the exporter or shipper, the claim must contain the proof of export and a statement signed by the person that paid the tax waiving the right to claim a credit or refund. Turbo tax 2011 The statement must include the amount of tax paid, the date of payment, and the office to which it was paid. Turbo tax 2011 Claim for price readjustment. Turbo tax 2011   To claim a credit or refund for a price readjustment, the person who paid the tax must include with the claim, a statement that contains the following. Turbo tax 2011 A description of the circumstances that gave rise to the price readjustment. Turbo tax 2011 An identification of the article whose price was readjusted. Turbo tax 2011 The price at which the article was sold. Turbo tax 2011 The amount of tax paid on the article and the date on which it was paid. Turbo tax 2011 The name and address of the purchaser. Turbo tax 2011 The amount repaid to the purchaser or credited to the purchaser's account. Turbo tax 2011 Sport Fishing Equipment A tax of 10% of the sale price is imposed on many articles of sport fishing equipment sold by the manufacturer. Turbo tax 2011 This includes any parts or accessories sold on or in connection with the sale of those articles. Turbo tax 2011 Pay this tax with Form 720. Turbo tax 2011 No tax deposits are required. Turbo tax 2011 Sport fishing equipment includes all the following items. Turbo tax 2011 Fishing rods and poles (and component parts), fishing reels, fly fishing lines, and other fishing lines not over 130 pounds test, fishing spears, spear guns, and spear tips. Turbo tax 2011 Items of terminal tackle, including leaders, artificial lures, artificial baits, artificial flies, fishing hooks, bobbers, sinkers, snaps, drayles, and swivels (but not including natural bait or any item of terminal tackle designed for use and ordinarily used on fishing lines not described in (1)). Turbo tax 2011 The following items of fishing supplies and accessories: fish stringers, creels, bags, baskets, and other containers designed to hold fish, portable bait containers, fishing vests, landing nets, gaff hooks, fishing hook disgorgers, and dressing for fishing lines and artificial flies. Turbo tax 2011 Fishing tip-ups and tilts. Turbo tax 2011 Fishing rod belts, fishing rodholders, fishing harnesses, fish fighting chairs, fishing outriggers, and fishing downriggers. Turbo tax 2011 See Revenue Ruling 88-52 in Cumulative Bulletin 1988-1 for a more complete description of the items of taxable equipment. Turbo tax 2011 Fishing rods and fishing poles. Turbo tax 2011   The tax on fishing rods and fishing poles (and component parts) is 10% of the sales price not to exceed $10 per article. Turbo tax 2011 The tax is paid by the manufacturer, producer, or importer. Turbo tax 2011 Fishing tackle boxes. Turbo tax 2011   The tax on fishing tackle boxes is 3% of the sales price. Turbo tax 2011 The tax is paid by the manufacturer, producer, or importer. Turbo tax 2011 Electric outboard boat motors. Turbo tax 2011   A tax of 3% of the sale price is imposed on the sale by the manufacturer of electric outboard motors. Turbo tax 2011 This includes any parts or accessories sold on or in connection with the sale of those articles. Turbo tax 2011 Certain equipment resale. Turbo tax 2011   The tax on the sale of sport fishing equipment is imposed a second time under the following circumstances. Turbo tax 2011 If the manufacturer sells a taxable article to any person, the manufacturer is liable for the tax. Turbo tax 2011 If the purchaser or any other person then sells it to a person who is related (discussed next) to the manufacturer, that related person is liable for a second tax on any subsequent sale of the article. Turbo tax 2011 The second tax, however, is not imposed if the constructive sale price rules under section 4216(b) apply to the sale by the manufacturer. Turbo tax 2011   If the second tax is imposed, a credit for tax previously paid by the manufacturer is available provided the related person can document the tax paid. Turbo tax 2011 The documentation requirement is generally satisfied only through submission of copies of actual records of the person that previously paid the tax. Turbo tax 2011 Related person. Turbo tax 2011   For the tax on sport fishing equipment, a person is a related person of the manufacturer if that person and the manufacturer have a relationship described in section 465(b)(3)(C). Turbo tax 2011 Bows, Quivers, Broadheads, and Points The tax on bows is 11% (. Turbo tax 2011 11) of the sales price. Turbo tax 2011 The tax is paid by the manufacturer, producer, or importer. Turbo tax 2011 It applies to bows having a peak draw weight of 30 pounds or more. Turbo tax 2011 The tax is also imposed on the sale of any part or accessory suitable for inclusion in or attachment to a taxable bow and any quiver, broadhead, or point suitable for use with arrows described below. Turbo tax 2011 Pay this tax with Form 720. Turbo tax 2011 No tax deposits are required. Turbo tax 2011 Arrow Shafts The tax on arrow shafts is listed on Form 720. Turbo tax 2011 The tax is paid by the manufacturer, producer, or importer of any arrow shaft (whether sold separately or incorporated as part of a finished or unfinished product) of a type used in the manufacture of any arrow that after its assembly meets either of the following conditions. Turbo tax 2011 It measures 18 inches or more in overall length. Turbo tax 2011 It measures less than 18 inches in overall length but is suitable for use with a taxable bow, described earlier. Turbo tax 2011 Exemption for certain wooden arrows. Turbo tax 2011   After October 3, 2008, the tax does not apply to any shaft made of all natural wood with no laminations or artificial means of enhancing the spine of such shaft (whether sold separately or incorporated as part of a finished or unfinished product) and used in the manufacture of any arrow that after its assembly meets both of the following conditions. Turbo tax 2011 It measures 5/16 of an inch or less in diameter. Turbo tax 2011 It is not suitable for use with a taxable bow, described earlier. Turbo tax 2011 Pay this tax with Form 720. Turbo tax 2011 No tax deposits are required. Turbo tax 2011 Coal A tax is imposed on the first sale of coal mined in the United States. Turbo tax 2011 The producer of the coal is liable for the tax. Turbo tax 2011 The producer is the person who has vested ownership of the coal under state law immediately after the coal is severed from the ground. Turbo tax 2011 Determine vested ownership without regard to any contractual arrangement for the sale or other disposition of the coal or the payment of any royalties between the producer and third parties. Turbo tax 2011 A producer includes any person who extracts coal from coal waste refuse piles (or from the silt waste product that results from the wet washing of coal). Turbo tax 2011 The tax is not imposed on coal extracted from a riverbed by dredging if it can be shown that the coal has been taxed previously. Turbo tax 2011 Tax rates. Turbo tax 2011   The tax on underground-mined coal is the lower of: $1. Turbo tax 2011 10 a ton, or 4. Turbo tax 2011 4% of the sale price. Turbo tax 2011   The tax on surface-mined coal is the lower of: 55 cents a ton, or 4. Turbo tax 2011 4% of the sale price. Turbo tax 2011   Coal will be taxed at the 4. Turbo tax 2011 4% rate if the selling price is less than $25 a ton for underground-mined coal and less than $12. Turbo tax 2011 50 a ton for surface-mined coal. Turbo tax 2011 Apply the tax proportionately if a sale or use includes a portion of a ton. Turbo tax 2011 Example. Turbo tax 2011 If you sell 21,000 pounds (10. Turbo tax 2011 5 tons) of coal from an underground mine for $525, the price per ton is $50. Turbo tax 2011 The tax is $1. Turbo tax 2011 10 × 10. Turbo tax 2011 5 tons ($11. Turbo tax 2011 55). Turbo tax 2011 Coal production. Turbo tax 2011   Coal is produced from surface mines if all geological matter (trees, earth, rock) above the coal is removed before the coal is mined. Turbo tax 2011 Treat coal removed by auger and coal reclaimed from coal waste refuse piles as produced from a surface mine. Turbo tax 2011   Treat coal as produced from an underground mine when the coal is not produced from a surface mine. Turbo tax 2011 In some cases, a single mine may yield coal from both surface mining and underground mining. Turbo tax 2011 Determine if the coal is from a surface mine or an underground mine for each ton of coal produced and not on a mine-by-mine basis. Turbo tax 2011 Determining tonnage or selling price. Turbo tax 2011   The producer pays the tax on coal at the time of sale or use. Turbo tax 2011 In figuring the selling price for applying the tax, the point of sale is f. Turbo tax 2011 o. Turbo tax 2011 b. Turbo tax 2011 (free on board) mine or f. Turbo tax 2011 o. Turbo tax 2011 b. Turbo tax 2011 cleaning plant if you clean the coal before selling it. Turbo tax 2011 This applies even if you sell the coal for a delivered price. Turbo tax 2011 The f. Turbo tax 2011 o. Turbo tax 2011 b. Turbo tax 2011 mine or f. Turbo tax 2011 o. Turbo tax 2011 b. Turbo tax 2011 cleaning plant is the point at which you figure the number of tons sold for applying the applicable tonnage rate, and the point at which you figure the sale price for applying the 4. Turbo tax 2011 4% rate. Turbo tax 2011   The tax applies to the full amount of coal sold. Turbo tax 2011 However, the IRS allows a calculated reduction of the taxable weight of the coal for the weight of the moisture in excess of the coal's inherent moisture content. Turbo tax 2011 Include in the sale price any additional charge for a freeze-conditioning additive in figuring the tax. Turbo tax 2011   Do not include in the sales price the excise tax imposed on coal. Turbo tax 2011 Coal used by the producer. Turbo tax 2011   The tax on coal applies if the coal is used by the producer in other than a mining process. Turbo tax 2011 A mining process means the same for this purpose as for percentage depletion. Turbo tax 2011 For example, the tax does not apply if, before selling the coal, you break it, clean it, size it, or apply any other process considered mining under the rules for depletion. Turbo tax 2011 In this case, the tax applies only when you sell the coal. Turbo tax 2011 The tax does not apply to coal used as fuel in the coal drying process since it is considered to be used in a mining process. Turbo tax 2011 However, the tax does apply when you use the coal as fuel or as an ingredient in making coke since the coal is not used in a mining process. Turbo tax 2011   You must use a constructive sale price to figure the tax under the 4. Turbo tax 2011 4% rate if you use the coal in other than a mining process. Turbo tax 2011 Base your constructive sale price on sales of a like kind and grade of coal by you or other producers made f. Turbo tax 2011 o. Turbo tax 2011 b. Turbo tax 2011 mine or cleaning plant. Turbo tax 2011 Normally, you use the same constructive price used to figure your percentage depletion deduction. Turbo tax 2011 Blending. Turbo tax 2011   If you blend surface-mined coal with underground-mined coal during the cleaning process, you must figure the excise tax on the sale of the blended, cleaned coal. Turbo tax 2011 Figure the tax separately for each type of coal in the blend. Turbo tax 2011 Base the tax on the amount of each type in the blend if you can determine the proportion of each type of coal contained in the final blend. Turbo tax 2011 Base the tax on the ratio of each type originally put into the cleaning process if you cannot determine the proportion of each type of coal in the blend. Turbo tax 2011 However, the tax is limited to 4. Turbo tax 2011 4% of the sale price per ton of the blended coal. Turbo tax 2011 Exemption from tax. Turbo tax 2011   The tax does not apply to sales of lignite and imported coal. Turbo tax 2011 The only other exemption from the tax on the sale of coal is for coal exported as discussed next. Turbo tax 2011 Exported. Turbo tax 2011   The tax does not apply to the sale of coal if the coal is in the stream of export when sold by the producer and the coal is actually exported. Turbo tax 2011   Coal is in the stream of export when sold by the producer if the sale is a step in the exportation of the coal to its ultimate destination in a foreign country. Turbo tax 2011 For example, coal is in the stream of export when: The coal is loaded on an export vessel and title is transferred from the producer to a foreign purchaser, or The producer sells the coal to an export broker in the United States under terms of a contract showing that the coal is to be shipped to a foreign country. Turbo tax 2011   Proof of export includes any of the following items. Turbo tax 2011 A copy of the export bill of lading issued by the delivering carrier. Turbo tax 2011 A certificate signed by the export carrier's agent or representative showing actual exportation of the coal. Turbo tax 2011 A certificate of landing signed by a customs officer of the foreign country to which the coal is exported. Turbo tax 2011 If the foreign country does not have a customs administrator, a statement of the foreign consignee showing receipt of the coal. Turbo tax 2011 Taxable Tires Taxable tires are divided into three categories for reporting and figuring the tax as described below. Turbo tax 2011 A tax is imposed on taxable tires sold by the manufacturer, producer, or importer at the rate of $. Turbo tax 2011 0945 ($. Turbo tax 2011 04725 in the case of a biasply tire or super single tire) for each 10 pounds of the maximum rated load capacity over 3,500 pounds. Turbo tax 2011 The three categories for reporting the tax and the tax rate are listed below. Turbo tax 2011 Taxable tires other than biasply or super single tires at $. Turbo tax 2011 0945. Turbo tax 2011 Taxable tires, biasply or super single tires (other than super single tires designed for steering) at $. Turbo tax 2011 04725. Turbo tax 2011 Taxable tires, super single tires designed for steering at $. Turbo tax 2011 0945. Turbo tax 2011 A taxable tire is any tire of the type used on highway vehicles if wholly or partially made of rubber and if marked according to federal regulations for highway use. Turbo tax 2011 A biasply tire is a pneumatic tire on which the ply cords that extend to the beads are laid at alternate angles substantially less than 90 degrees to the centerline of the tread. Turbo tax 2011 A super single tire is a tire greater than 13 inches in cross section width designed to replace 2 tires in a dual fitment. Turbo tax 2011 Special rule, manufacturer's retail stores. Turbo tax 2011   The excise tax on taxable tires is imposed at the time the taxable tires are delivered to the manufacturer-owned retail stores, not at the time of sale. Turbo tax 2011 Tires on imported articles. Turbo tax 2011   The importer of an article equipped with taxable tires is treated as the manufacturer of the tires and is liable for the taxable tire excise tax when the article is sold (except in the case of an automobile bus chassis or body with tires). Turbo tax 2011 Tires exempt from tax. Turbo tax 2011   The tax on taxable tires does not apply to the following items. Turbo tax 2011 Domestically recapped or retreaded tires if the tires have been sold previously in the United States and were taxable tires at the time of sale. Turbo tax 2011 Tire carcasses not suitable for commercial use. Turbo tax 2011 Tires for use on qualifying intercity, local, and school buses. Turbo tax 2011 For tax-free treatment, the registration requirements discussed earlier under Requirements for Exempt Sales apply. Turbo tax 2011 Tires sold for the exclusive use of the Department of Defense or the Coast Guard. Turbo tax 2011 Tires of a type used exclusively on mobile machinery. Turbo tax 2011 A taxable tire used on mobile machinery is not exempt from tax. Turbo tax 2011 Qualifying intercity or local bus. Turbo tax 2011   This is any bus used mainly (more than 50%) to transport the general public for a fee and that either operates on a schedule along regular routes or seats at least 20 adults (excluding the driver). Turbo tax 2011 Qualifying school bus. Turbo tax 2011   This is any bus substantially all the use (85% or more) of which is to transport students and employees of schools. Turbo tax 2011 Credit or refund. Turbo tax 2011   A credit or refund (without interest) is allowable on tax-paid tires if the tires have been: Exported; Sold to a state or local government for its exclusive use; Sold to a nonprofit educational organization for its exclusive use (as defined under Communications Tax in chapter 4); Sold to a qualified blood collector organization (as defined under Communications Tax in chapter 4) for its exclusive use in connection with a vehicle the organization certifies will be primarily used in the collection, storage, or transportation of blood; Used or sold for use as supplies for vessels; or Sold in connection with qualified intercity, local, or school buses. Turbo tax 2011   Also, a credit or refund (without interest) is allowable on tax-paid tires sold by any person on, or in connection with, any other article that is sold or used in an activity listed above. Turbo tax 2011   The person who paid the tax is eligible to make the claim. Turbo tax 2011 Gas Guzzler Tax Tax is imposed on the sale by the manufacturer of automobiles of a model type that has a fuel economy standard as measured by the Environmental Protection Agency (EPA) of less than 22. Turbo tax 2011 5 miles per gallon. Turbo tax 2011 If you import an automobile for personal use, you may be liable for this tax. Turbo tax 2011 Figure the tax on Form 6197, as discussed later. Turbo tax 2011 The tax rate is based on fuel economy rating. Turbo tax 2011 The tax rates for the gas guzzler tax are shown on Form 6197. Turbo tax 2011 A person that lengthens an existing automobile is the manufacturer of an automobile. Turbo tax 2011 Automobiles. Turbo tax 2011   An automobile (including limousines) means any four-wheeled vehicle that is: Rated at an unloaded gross vehicle weight of 6,000 pounds or less, Propelled by an engine powered by gasoline or diesel fuel, and Intended for use mainly on public streets, roads, and highways. Turbo tax 2011 Vehicles not subject to tax. Turbo tax 2011   For the gas guzzler tax, the following vehicles are not considered automobiles. Turbo tax 2011 Limousines with a gross unloaded vehicle weight of more than 6,000 pounds. Turbo tax 2011 Vehicles operated exclusively on a rail or rails. Turbo tax 2011 Vehicles sold for use and used primarily: As ambulances or combination ambulance-hearses, For police or other law enforcement purposes by federal, state, or local governments, or For firefighting purposes. Turbo tax 2011 Vehicles treated under 49 U. Turbo tax 2011 S. Turbo tax 2011 C. Turbo tax 2011 32901 (1978) as non-passenger automobiles. Turbo tax 2011 This includes limousines manufactured primarily to transport more than 10 persons. Turbo tax 2011   The manufacturer can sell a vehicle described in item (3) tax free only when the sale is made directly to a purchaser for the described emergency use and the manufacturer and purchaser (other than a state or local government) are registered. Turbo tax 2011   Treat an Indian tribal government as a state only if the police or other law enforcement purposes are an essential tribal government function. Turbo tax 2011 Model type. Turbo tax 2011   Model type is a particular class of automobile as determined by EPA regulations. Turbo tax 2011 Fuel economy. Turbo tax 2011   Fuel economy is the average number of miles an automobile travels on a gallon of gasoline (or diesel fuel) rounded to the nearest 0. Turbo tax 2011 1 mile as figured by the EPA. Turbo tax 2011 Imported automobiles. Turbo tax 2011   The tax also applies to automobiles that do not have a prototype-based fuel economy rating assigned by the EPA. Turbo tax 2011 An automobile imported into the United States without a certificate of conformity to United States emission standards and that has no assigned fuel economy rating must be either: Converted by installation of emission controls to conform in all material respects to an automobile already certified for sale in the United States, or Modified by installation of emission control components and individually tested to demonstrate emission compliance. Turbo tax 2011   An imported automobile that has been converted to conform to an automobile already certified for sale in the United States may use the fuel economy rating assigned to that certified automobile. Turbo tax 2011   A fuel economy rating is not generally available for modified imported automobiles because the EPA does not require a highway fuel economy test on them. Turbo tax 2011 A separate highway fuel economy test would be required to devise a fuel economy rating (otherwise the automobile is presumed to fall within the lowest fuel economy rating category). Turbo tax 2011   For more information about fuel economy ratings for imported automobiles, see Revenue Ruling 86-20 and Revenue Procedure 86-9 in Cumulative Bulletin 1986-1, and Revenue Procedure 87-10 in Cumulative Bulletin 1987-1. Turbo tax 2011 Exemptions. Turbo tax 2011   No one is exempt from the gas guzzler tax, including the federal government, state and local governments, qualified blood collector organizations, and nonprofit educational organizations. Turbo tax 2011 However, see Vehicles not subject to tax, earlier. Turbo tax 2011 Form 6197. Turbo tax 2011   Use Form 6197 to figure your tax liability for each quarter. Turbo tax 2011 Attach Form 6197 to your Form 720 for the quarter. Turbo tax 2011 See the Form 6197 instructions for more information and the one-time filing rules. Turbo tax 2011 Credit or refund. Turbo tax 2011   If the manufacturer paid the tax on a vehicle that is used or resold for an emergency use (see item (3) under Vehicles not subject to tax), the manufacturer can claim a credit or refund. Turbo tax 2011 For information about how to file for credits or refunds, see the Instructions for Form 720 or Form 8849. Turbo tax 2011 Vaccines Tax is imposed on certain vaccines sold by the manufacturer in the United States. Turbo tax 2011 A taxable vaccine means any of the following vaccines. Turbo tax 2011 Any vaccine containing diphtheria toxoid. Turbo tax 2011 Any vaccine containing tetanus toxoid. Turbo tax 2011 Any vaccine containing pertussis bacteria, extracted or partial cell bacteria, or specific pertussis antigens. Turbo tax 2011 Any vaccine containing polio virus. Turbo tax 2011 Any vaccine against measles. Turbo tax 2011 Any vaccine against mumps. Turbo tax 2011 Any vaccine against rubella. Turbo tax 2011 Any vaccine against hepatitis A. Turbo tax 2011 Any vaccine against hepatitis B. Turbo tax 2011 Any vaccine against chicken pox. Turbo tax 2011 Any vaccine against rotavirus gastroenteritis. Turbo tax 2011 Any HIB vaccine. Turbo tax 2011 Any conjugate vaccine against streptococcus pneumoniae. Turbo tax 2011 Any trivalent vaccine against influenza or any other vaccine against influenza. Turbo tax 2011 Any meningococcal vaccine. Turbo tax 2011 Any vaccine against the human papillomavirus. Turbo tax 2011 The effective date for the tax on any vaccine against influenza, other than trivalent influenza vaccines, is the later of August 1, 2013, or the date the Secretary of Health and Human Services lists a vaccine against seasonal influenza for purposes of compensation for any vaccine-related injury or death through the Vaccine Injury Compensation Trust Fund. Turbo tax 2011 The tax is $. Turbo tax 2011 75 per dose of each taxable vaccine. Turbo tax 2011 The tax per dose on a vaccine that contains more than one taxable vaccine is $. Turbo tax 2011 75 times the number of taxable vaccines. Turbo tax 2011 Taxable use. Turbo tax 2011   Any manufacturer (including a governmental entity) that uses a taxable vaccine before it is sold will be liable for the tax in the same manner as if the vaccine was sold by the manufacturer. Turbo tax 2011 Credit or refund. Turbo tax 2011   A credit or refund (without interest) is available if the vaccine is: Returned to the person who paid the tax (other than for resale), or Destroyed. Turbo tax 2011 The claim for a credit or refund must be filed within 6 months after the vaccine is returned or destroyed. Turbo tax 2011 Conditions to allowance. Turbo tax 2011   To claim a credit or refund, the person who paid the tax must have repaid or agreed to repay the tax to the ultimate purchaser of the vaccine or obtained the written consent of such purchaser to allowance of the credit or refund. Turbo tax 2011 Taxable Medical Devices Taxable medical devices. Turbo tax 2011   The tax on the sale of certain medical devices by the manufacturer, producer, or importer of the device is 2. Turbo tax 2011 3% (. Turbo tax 2011 023) of the sales price. Turbo tax 2011 A taxable medical device is a device that is listed as a device with the Food and Drug Administration (FDA) under section 510(j) of the Federal Food, Drug, and Cosmetic Act and 21 CFR part 807, pursuant to FDA requirements. Turbo tax 2011 There are specific exemptions for eyeglasses, contact lenses, and hearing aids. Turbo tax 2011 There is also an exemption for devices that are determined by the Secretary to be of a type that are generally purchased by the general public at retail for individual use (this exemption is known as the retail exemption). Turbo tax 2011 See T. Turbo tax 2011 D. Turbo tax 2011 9604 for information on how to determine whether a device falls within the retail exemption, and examples of how a taxpayer might evaluate a given device. Turbo tax 2011 More information. Turbo tax 2011   For more information on the medical device tax, see section 4191, T. Turbo tax 2011 D. Turbo tax 2011 9604, and Notice 2012-77. Turbo tax 2011 You can find T. Turbo tax 2011 D. Turbo tax 2011 9604 and Notice 2012-77 on pages 730 and 781, respectively, of I. Turbo tax 2011 R. Turbo tax 2011 B. Turbo tax 2011 2012-52 at www. Turbo tax 2011 irs. Turbo tax 2011 gov/pub/irs-irbs/irb12-52. Turbo tax 2011 pdf. Turbo tax 2011 Prev  Up  Next   Home   More Online Publications