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Www freetaxusa 11. Www freetaxusa   Social Security and Equivalent Railroad Retirement Benefits Table of Contents Introduction Useful Items - You may want to see: Are Any of Your Benefits Taxable? How To Report Your BenefitsHow Much Is Taxable? Examples Deductions Related to Your BenefitsRepayments More Than Gross Benefits Introduction This chapter explains the federal income tax rules for social security benefits and equivalent tier 1 railroad retirement benefits. Www freetaxusa It explains the following topics. Www freetaxusa How to figure whether your benefits are taxable. Www freetaxusa How to use the social security benefits worksheet (with examples). Www freetaxusa How to report your taxable benefits. Www freetaxusa How to treat repayments that are more than the benefits you received during the year. Www freetaxusa Social security benefits include monthly retirement, survivor, and disability benefits. Www freetaxusa They do not include supplemental security income (SSI) payments, which are not taxable. Www freetaxusa Equivalent tier 1 railroad retirement benefits are the part of tier 1 benefits that a railroad employee or beneficiary would have been entitled to receive under the social security system. Www freetaxusa They are commonly called the social security equivalent benefit (SSEB) portion of tier 1 benefits. Www freetaxusa If you received these benefits during 2013, you should have received a Form SSA-1099, Social Security Benefit Statement, or Form RRB-1099, Payments by the Railroad Retirement Board. Www freetaxusa These forms show the amounts received and repaid, and taxes withheld for the year. Www freetaxusa You may receive more than one of these forms for the same year. Www freetaxusa You should add the amounts shown on all the Forms SSA-1099 and Forms RRB-1099 you receive for the year to determine the total amounts received and repaid, and taxes withheld for that year. Www freetaxusa See the Appendix at the end of Publication 915 for more information. Www freetaxusa Note. Www freetaxusa When the term “benefits” is used in this chapter, it applies to both social security benefits and the SSEB portion of tier 1 railroad retirement benefits. Www freetaxusa What is not covered in this chapter. Www freetaxusa   This chapter does not cover the tax rules for the following railroad retirement benefits. Www freetaxusa Non-social security equivalent benefit (NSSEB) portion of tier 1 benefits. Www freetaxusa Tier 2 benefits. Www freetaxusa Vested dual benefits. Www freetaxusa Supplemental annuity benefits. Www freetaxusa For information on these benefits, see Publication 575, Pension and Annuity Income. Www freetaxusa   This chapter does not cover the tax rules for social security benefits reported on Form SSA-1042S, Social Security Benefit Statement, or Form RRB-1042S, Statement for Nonresident Alien Recipients of: Payments by the Railroad Retirement Board. Www freetaxusa For information about these benefits, see Publication 519, U. Www freetaxusa S. Www freetaxusa Tax Guide for Aliens, and Publication 915, Social Security and Equivalent Railroad Retirement Benefits. Www freetaxusa   This chapter also does not cover the tax rules for foreign social security benefits. Www freetaxusa These benefits are taxable as annuities, unless they are exempt from U. Www freetaxusa S. Www freetaxusa tax or treated as a U. Www freetaxusa S. Www freetaxusa social security benefit under a tax treaty. Www freetaxusa Useful Items - You may want to see: Publication 505 Tax Withholding and Estimated Tax 575 Pension and Annuity Income 590 Individual Retirement Arrangements (IRAs) 915 Social Security and Equivalent Railroad Retirement Benefits Forms (and Instructions) 1040-ES Estimated Tax for Individuals SSA-1099 Social Security Benefit Statement RRB-1099 Payments by the Railroad Retirement Board W-4V Voluntary Withholding Request Are Any of Your Benefits Taxable? To find out whether any of your benefits may be taxable, compare the base amount for your filing status with the total of: One-half of your benefits, plus All your other income, including tax-exempt interest. Www freetaxusa When making this comparison, do not reduce your other income by any exclusions for: Interest from qualified U. Www freetaxusa S. Www freetaxusa savings bonds, Employer-provided adoption benefits, Foreign earned income or foreign housing, or Income earned by bona fide residents of American Samoa or Puerto Rico. Www freetaxusa Children's benefits. Www freetaxusa   The rules in this chapter apply to benefits received by children. Www freetaxusa See Who is taxed , later. Www freetaxusa Figuring total income. Www freetaxusa   To figure the total of one-half of your benefits plus your other income, use Worksheet 11-1 later in this discussion. Www freetaxusa If the total is more than your base amount, part of your benefits may be taxable. Www freetaxusa    If you are married and file a joint return for 2013, you and your spouse must combine your incomes and your benefits to figure whether any of your combined benefits are taxable. Www freetaxusa Even if your spouse did not receive any benefits, you must add your spouse's income to yours to figure whether any of your benefits are taxable. Www freetaxusa    If the only income you received during 2013 was your social security or the SSEB portion of tier 1 railroad retirement benefits, your benefits generally are not taxable and you probably do not have to file a return. Www freetaxusa If you have income in addition to your benefits, you may have to file a return even if none of your benefits are taxable. Www freetaxusa Base amount. Www freetaxusa   Your base amount is: $25,000 if you are single, head of household, or qualifying widow(er), $25,000 if you are married filing separately and lived apart from your spouse for all of 2013, $32,000 if you are married filing jointly, or $-0- if you are married filing separately and lived with your spouse at any time during 2013. Www freetaxusa Worksheet 11-1. Www freetaxusa   You can use Worksheet 11-1 to figure the amount of income to compare with your base amount. Www freetaxusa This is a quick way to check whether some of your benefits may be taxable. Www freetaxusa Worksheet 11-1. Www freetaxusa A Quick Way To Check if Your Benefits May Be Taxable A. Www freetaxusa Enter the amount from box 5 of all your Forms SSA-1099 and RRB-1099. Www freetaxusa Include the full amount of any lump-sum benefit payments received in 2013, for 2013 and earlier years. Www freetaxusa (If you received more than one form, combine the amounts from box 5 and enter the total. Www freetaxusa ) A. Www freetaxusa   Note. Www freetaxusa If the amount on line A is zero or less, stop here; none of your benefits are taxable this year. Www freetaxusa B. Www freetaxusa Enter one-half of the amount on line A B. Www freetaxusa   C. Www freetaxusa Enter your taxable pensions, wages, interest, dividends, and other taxable income C. Www freetaxusa   D. Www freetaxusa Enter any tax-exempt interest income (such as interest on municipal bonds) plus any exclusions from income (listed earlier) D. Www freetaxusa   E. Www freetaxusa Add lines B, C, and D E. Www freetaxusa   Note. Www freetaxusa Compare the amount on line E to your base amount for your filing status. Www freetaxusa If the amount on line E equals or is less than the base amount for your filing status, none of your benefits are taxable this year. Www freetaxusa If the amount on line E is more than your base amount, some of your benefits may be taxable. Www freetaxusa You need to complete Worksheet 1 in Publication 915 (or the Social Security Benefits Worksheet in your tax form instructions). Www freetaxusa If none of your benefits are taxable, but you otherwise must file a tax return, see Benefits not taxable , later, under How To Report Your Benefits. Www freetaxusa Example. Www freetaxusa You and your spouse (both over 65) are filing a joint return for 2013 and you both received social security benefits during the year. Www freetaxusa In January 2014, you received a Form SSA-1099 showing net benefits of $7,500 in box 5. Www freetaxusa Your spouse received a Form SSA-1099 showing net benefits of $3,500 in box 5. Www freetaxusa You also received a taxable pension of $22,800 and interest income of $500. Www freetaxusa You did not have any tax-exempt interest income. Www freetaxusa Your benefits are not taxable for 2013 because your income, as figured in Worksheet 11-1, is not more than your base amount ($32,000) for married filing jointly. Www freetaxusa Even though none of your benefits are taxable, you must file a return for 2013 because your taxable gross income ($23,300) exceeds the minimum filing requirement amount for your filing status. Www freetaxusa Filled-in Worksheet 11-1. Www freetaxusa A Quick Way To Check if Your Benefits May Be Taxable A. Www freetaxusa Enter the amount from box 5 of all your Forms SSA-1099 and RRB-1099. Www freetaxusa Include the full amount of any lump-sum benefit payments received in 2013, for 2013 and earlier years. Www freetaxusa (If you received more than one form, combine the amounts from box 5 and enter the total. Www freetaxusa ) A. Www freetaxusa $11,000 Note. Www freetaxusa If the amount on line A is zero or less, stop here; none of your benefits are taxable this year. Www freetaxusa B. Www freetaxusa Enter one-half of the amount on line A B. Www freetaxusa 5,500 C. Www freetaxusa Enter your taxable pensions, wages, interest, dividends, and other taxable income C. Www freetaxusa 23,300 D. Www freetaxusa Enter any tax-exempt interest income (such as interest on municipal bonds) plus any exclusions from income (listed earlier) D. Www freetaxusa -0- E. Www freetaxusa Add lines B, C, and D E. Www freetaxusa $28,800 Note. Www freetaxusa Compare the amount on line E to your base amount for your filing status. Www freetaxusa If the amount on line E equals or is less than the base amount for your filing status, none of your benefits are taxable this year. Www freetaxusa If the amount on line E is more than your base amount, some of your benefits may be taxable. Www freetaxusa You need to complete Worksheet 1 in Publication 915 (or the Social Security Benefits Worksheet in your tax form instructions). Www freetaxusa If none of your benefits are taxable, but you otherwise must file a tax return, see Benefits not taxable , later, under How To Report Your Benefits. Www freetaxusa Who is taxed. Www freetaxusa   Benefits are included in the taxable income (to the extent they are taxable) of the person who has the legal right to receive the benefits. Www freetaxusa For example, if you and your child receive benefits, but the check for your child is made out in your name, you must use only your part of the benefits to see whether any benefits are taxable to you. Www freetaxusa One-half of the part that belongs to your child must be added to your child's other income to see whether any of those benefits are taxable to your child. Www freetaxusa Repayment of benefits. Www freetaxusa   Any repayment of benefits you made during 2013 must be subtracted from the gross benefits you received in 2013. Www freetaxusa It does not matter whether the repayment was for a benefit you received in 2013 or in an earlier year. Www freetaxusa If you repaid more than the gross benefits you received in 2013, see Repayments More Than Gross Benefits , later. Www freetaxusa   Your gross benefits are shown in box 3 of Form SSA-1099 or RRB-1099. Www freetaxusa Your repayments are shown in box 4. Www freetaxusa The amount in box 5 shows your net benefits for 2013 (box 3 minus box 4). Www freetaxusa Use the amount in box 5 to figure whether any of your benefits are taxable. Www freetaxusa Tax withholding and estimated tax. Www freetaxusa   You can choose to have federal income tax withheld from your social security benefits and/or the SSEB portion of your tier 1 railroad retirement benefits. Www freetaxusa If you choose to do this, you must complete a Form W-4V. Www freetaxusa   If you do not choose to have income tax withheld, you may have to request additional withholding from other income or pay estimated tax during the year. Www freetaxusa For details, see Publication 505 or the instructions for Form 1040-ES. Www freetaxusa How To Report Your Benefits If part of your benefits are taxable, you must use Form 1040 or Form 1040A. Www freetaxusa You cannot use Form 1040EZ. Www freetaxusa Reporting on Form 1040. Www freetaxusa   Report your net benefits (the total amount from box 5 of all your Forms SSA-1099 and Forms RRB-1099) on line 20a and the taxable part on line 20b. Www freetaxusa If you are married filing separately and you lived apart from your spouse for all of 2013, also enter “D” to the right of the word “benefits” on line 20a. Www freetaxusa Reporting on Form 1040A. Www freetaxusa   Report your net benefits (the total amount from box 5 of all your Forms SSA-1099 and Forms RRB-1099) on line 14a and the taxable part on line 14b. Www freetaxusa If you are married filing separately and you lived apart from your spouse for all of 2013, also enter “D” to the right of the word “benefits” on line 14a. Www freetaxusa Benefits not taxable. Www freetaxusa   If you are filing Form 1040EZ, do not report any benefits on your tax return. Www freetaxusa If you are filing Form 1040 or Form 1040A, report your net benefits (the total amount from box 5 of all your Forms SSA-1099 and Forms RRB-1099) on Form 1040, line 20a, or Form 1040A, line 14a. Www freetaxusa Enter -0- on Form 1040, line 20b, or Form 1040A, line 14b. Www freetaxusa If you are married filing separately and you lived apart from your spouse for all of 2013, also enter “D” to the right of the word “benefits” on Form 1040, line 20a, or Form 1040A, line 14a. Www freetaxusa How Much Is Taxable? If part of your benefits are taxable, how much is taxable depends on the total amount of your benefits and other income. Www freetaxusa Generally, the higher that total amount, the greater the taxable part of your benefits. Www freetaxusa Maximum taxable part. Www freetaxusa   Generally, up to 50% of your benefits will be taxable. Www freetaxusa However, up to 85% of your benefits can be taxable if either of the following situations applies to you. Www freetaxusa The total of one-half of your benefits and all your other income is more than $34,000 ($44,000 if you are married filing jointly). Www freetaxusa You are married filing separately and lived with your spouse at any time during 2013. Www freetaxusa Which worksheet to use. Www freetaxusa   A worksheet you can use to figure your taxable benefits is in the instructions for your Form 1040 or Form 1040A. Www freetaxusa You can use either that worksheet or Worksheet 1 in Publication 915, unless any of the following situations applies to you. Www freetaxusa You contributed to a traditional individual retirement arrangement (IRA) and you or your spouse is covered by a retirement plan at work. Www freetaxusa In this situation, you must use the special worksheets in Appendix B of Publication 590 to figure both your IRA deduction and your taxable benefits. Www freetaxusa Situation (1) does not apply and you take an exclusion for interest from qualified U. Www freetaxusa S. Www freetaxusa savings bonds (Form 8815), for adoption benefits (Form 8839), for foreign earned income or housing (Form 2555 or Form 2555-EZ), or for income earned in American Samoa (Form 4563) or Puerto Rico by bona fide residents. Www freetaxusa In this situation, you must use Worksheet 1 in Publication 915 to figure your taxable benefits. Www freetaxusa You received a lump-sum payment for an earlier year. Www freetaxusa In this situation, also complete Worksheet 2 or 3 and Worksheet 4 in Publication 915. Www freetaxusa See Lump-sum election next. Www freetaxusa Lump-sum election. Www freetaxusa   You must include the taxable part of a lump-sum (retroactive) payment of benefits received in 2013 in your 2013 income, even if the payment includes benefits for an earlier year. Www freetaxusa    This type of lump-sum benefit payment should not be confused with the lump-sum death benefit that both the SSA and RRB pay to many of their beneficiaries. Www freetaxusa No part of the lump-sum death benefit is subject to tax. Www freetaxusa   Generally, you use your 2013 income to figure the taxable part of the total benefits received in 2013. Www freetaxusa However, you may be able to figure the taxable part of a lump-sum payment for an earlier year separately, using your income for the earlier year. Www freetaxusa You can elect this method if it lowers your taxable benefits. Www freetaxusa Making the election. Www freetaxusa   If you received a lump-sum benefit payment in 2013 that includes benefits for one or more earlier years, follow the instructions in Publication 915 under Lump-Sum Election to see whether making the election will lower your taxable benefits. Www freetaxusa That discussion also explains how to make the election. Www freetaxusa    Because the earlier year's taxable benefits are included in your 2013 income, no adjustment is made to the earlier year's return. Www freetaxusa Do not file an amended return for the earlier year. Www freetaxusa Examples The following are a few examples you can use as a guide to figure the taxable part of your benefits. Www freetaxusa Example 1. Www freetaxusa George White is single and files Form 1040 for 2013. Www freetaxusa He received the following income in 2013: Fully taxable pension $18,600 Wages from part-time job 9,400 Taxable interest income 990 Total $28,990 George also received social security benefits during 2013. Www freetaxusa The Form SSA-1099 he received in January 2014 shows $5,980 in box 5. Www freetaxusa To figure his taxable benefits, George completes the worksheet shown here. Www freetaxusa Filled-in Worksheet 1. Www freetaxusa Figuring Your Taxable Benefits 1. Www freetaxusa Enter the total amount from box 5 of ALL your Forms SSA-1099 and RRB-1099. Www freetaxusa Also enter this amount on Form 1040, line 20a, or Form 1040A, line 14a $5,980 2. Www freetaxusa Enter one-half of line 1 2,990 3. Www freetaxusa Combine the amounts from:     Form 1040: Lines 7, 8a, 9a, 10 through 14, 15b, 16b, 17 through 19, and 21. Www freetaxusa     Form 1040A: Lines 7, 8a, 9a, 10, 11b, 12b, and 13 28,990 4. Www freetaxusa Enter the amount, if any, from Form 1040 or 1040A, line 8b -0-       5. Www freetaxusa Enter the total of any exclusions/adjustments for: Adoption benefits (Form 8839, line 28), Foreign earned income or housing (Form 2555, lines 45 and 50, or Form 2555-EZ, line 18), and Certain income of bona fide residents of American Samoa (Form 4563, line 15) or Puerto Rico -0-       6. Www freetaxusa Combine lines 2, 3, 4, and 5 31,980 7. Www freetaxusa Form 1040 filers: Enter the amount from Form 1040, lines 23 through 32, and any write-in adjustments you entered on the dotted line next to line 36. Www freetaxusa     Form 1040A filers: Enter the amount from Form 1040A, lines 16 and 17 -0- 8. Www freetaxusa Is the amount on line 7 less than the amount on line 6?     No. Www freetaxusa None of your social security benefits are taxable. Www freetaxusa Enter -0- on Form 1040, line 20b, or Form 1040A, line 14b. Www freetaxusa   Yes. Www freetaxusa Subtract line 7 from line 6 31,980 9. Www freetaxusa If you are: Married filing jointly, enter $32,000 Single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013, enter $25,000 25,000   Note. Www freetaxusa If you are married filing separately and you lived with your spouse at any time in 2013, skip lines 9 through 16; multiply line 8 by 85% (. Www freetaxusa 85) and enter the result on line 17. Www freetaxusa Then go to line 18. Www freetaxusa   10. Www freetaxusa Is the amount on line 9 less than the amount on line 8?     No. Www freetaxusa None of your benefits are taxable. Www freetaxusa Enter -0- on Form 1040, line 20b, or on Form 1040A, line 14b. Www freetaxusa If you are married filing separately and you lived apart from your spouse for all of 2013, be sure you entered “D” to the right of the word “benefits” on Form 1040, line 20a, or on Form 1040A, line 14a. Www freetaxusa     Yes. Www freetaxusa Subtract line 9 from line 8 6,980 11. Www freetaxusa Enter $12,000 if married filing jointly; $9,000 if single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013 9,000 12. Www freetaxusa Subtract line 11 from line 10. Www freetaxusa If zero or less, enter -0- -0- 13. Www freetaxusa Enter the smaller of line 10 or line 11 6,980 14. Www freetaxusa Enter one-half of line 13 3,490 15. Www freetaxusa Enter the smaller of line 2 or line 14 2,990 16. Www freetaxusa Multiply line 12 by 85% (. Www freetaxusa 85). Www freetaxusa If line 12 is zero, enter -0- -0- 17. Www freetaxusa Add lines 15 and 16 2,990 18. Www freetaxusa Multiply line 1 by 85% (. Www freetaxusa 85) 5,083 19. Www freetaxusa Taxable benefits. Www freetaxusa Enter the smaller of line 17 or line 18. Www freetaxusa Also enter this amount on Form 1040, line 20b, or Form 1040A, line 14b $2,990 The amount on line 19 of George's worksheet shows that $2,990 of his social security benefits is taxable. Www freetaxusa On line 20a of his Form 1040, George enters his net benefits of $5,980. Www freetaxusa On line 20b, he enters his taxable benefits of $2,990. Www freetaxusa Example 2. Www freetaxusa Ray and Alice Hopkins file a joint return on Form 1040A for 2013. Www freetaxusa Ray is retired and received a fully taxable pension of $15,500. Www freetaxusa He also received social security benefits, and his Form SSA-1099 for 2013 shows net benefits of $5,600 in box 5. Www freetaxusa Alice worked during the year and had wages of $14,000. Www freetaxusa She made a deductible payment to her IRA account of $1,000. Www freetaxusa Ray and Alice have two savings accounts with a total of $250 in taxable interest income. Www freetaxusa They complete Worksheet 1, entering $29,750 ($15,500 + $14,000 + $250) on line 3. Www freetaxusa They find none of Ray's social security benefits are taxable. Www freetaxusa On Form 1040A, they enter $5,600 on line 14a and -0- on line 14b. Www freetaxusa Filled-in Worksheet 1. Www freetaxusa Figuring Your Taxable Benefits 1. Www freetaxusa Enter the total amount from box 5 of ALL your Forms SSA-1099 and RRB-1099. Www freetaxusa Also enter this amount on Form 1040, line 20a, or Form 1040A, line 14a $5,600 2. Www freetaxusa Enter one-half of line 1 2,800 3. Www freetaxusa Combine the amounts from:     Form 1040: Lines 7, 8a, 9a, 10 through 14, 15b, 16b, 17 through 19, and 21. Www freetaxusa     Form 1040A: Lines 7, 8a, 9a, 10, 11b, 12b, and 13 29,750 4. Www freetaxusa Enter the amount, if any, from Form 1040 or 1040A, line 8b -0-       5. Www freetaxusa Enter the total of any exclusions/adjustments for: Adoption benefits (Form 8839, line 28), Foreign earned income or housing (Form 2555, lines 45 and 50, or Form 2555-EZ, line 18), and Certain income of bona fide residents of American Samoa (Form 4563, line 15) or Puerto Rico -0-       6. Www freetaxusa Combine lines 2, 3, 4, and 5 32,550 7. Www freetaxusa Form 1040 filers: Enter the amount from Form 1040, lines 23 through 32, and any write-in adjustments you entered on the dotted line next to line 36. Www freetaxusa     Form 1040A filers: Enter the amount from Form 1040A, lines 16 and 17 1,000 8. Www freetaxusa Is the amount on line 7 less than the amount on line 6?     No. Www freetaxusa None of your social security benefits are taxable. Www freetaxusa Enter -0- on Form 1040, line 20b, or Form 1040A, line 14b. Www freetaxusa   Yes. Www freetaxusa Subtract line 7 from line 6 31,550 9. Www freetaxusa If you are: Married filing jointly, enter $32,000 Single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013, enter $25,000 32,000   Note. Www freetaxusa If you are married filing separately and you lived with your spouse at any time in 2013, skip lines 9 through 16; multiply line 8 by 85% (. Www freetaxusa 85) and enter the result on line 17. Www freetaxusa Then go to line 18. Www freetaxusa   10. Www freetaxusa Is the amount on line 9 less than the amount on line 8?     No. Www freetaxusa None of your benefits are taxable. Www freetaxusa Enter -0- on Form 1040, line 20b, or on Form 1040A, line 14b. Www freetaxusa If you are married filing separately and you lived apart from your spouse for all of 2013, be sure you entered “D” to the right of the word “benefits” on Form 1040, line 20a, or on Form 1040A, line 14a. Www freetaxusa     Yes. Www freetaxusa Subtract line 9 from line 8   11. Www freetaxusa Enter $12,000 if married filing jointly; $9,000 if single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013   12. Www freetaxusa Subtract line 11 from line 10. Www freetaxusa If zero or less, enter -0-   13. Www freetaxusa Enter the smaller of line 10 or line 11   14. Www freetaxusa Enter one-half of line 13   15. Www freetaxusa Enter the smaller of line 2 or line 14   16. Www freetaxusa Multiply line 12 by 85% (. Www freetaxusa 85). Www freetaxusa If line 12 is zero, enter -0-   17. Www freetaxusa Add lines 15 and 16   18. Www freetaxusa Multiply line 1 by 85% (. Www freetaxusa 85)   19. Www freetaxusa Taxable benefits. Www freetaxusa Enter the smaller of line 17 or line 18. Www freetaxusa Also enter this amount on Form 1040, line 20b, or Form 1040A, line 14b   Example 3. Www freetaxusa Joe and Betty Johnson file a joint return on Form 1040 for 2013. Www freetaxusa Joe is a retired railroad worker and in 2013 received the social security equivalent benefit (SSEB) portion of tier 1 railroad retirement benefits. Www freetaxusa Joe's Form RRB-1099 shows $10,000 in box 5. Www freetaxusa Betty is a retired government worker and receives a fully taxable pension of $38,000. Www freetaxusa They had $2,300 in taxable interest income plus interest of $200 on a qualified U. Www freetaxusa S. Www freetaxusa savings bond. Www freetaxusa The savings bond interest qualified for the exclusion. Www freetaxusa They figure their taxable benefits by completing Worksheet 1. Www freetaxusa Because they have qualified U. Www freetaxusa S. Www freetaxusa savings bond interest, they follow the note at the beginning of the worksheet and use the amount from line 2 of their Schedule B (Form 1040A or 1040) on line 3 of the worksheet instead of the amount from line 8a of their Form 1040. Www freetaxusa On line 3 of the worksheet, they enter $40,500 ($38,000 + $2,500). Www freetaxusa Filled-in Worksheet 1. Www freetaxusa Figuring Your Taxable Benefits Before you begin: • If you are married filing separately and you lived apart from your spouse for all of 2013, enter “D” to the right of the word “benefits” on Form 1040, line 20a, or Form 1040A, line 14a. Www freetaxusa • Do not use this worksheet if you repaid benefits in 2013 and your total repayments (box 4 of Forms SSA-1099 and RRB-1099) were more than your gross benefits for 2013 (box 3 of Forms SSA-1099 and RRB-1099). Www freetaxusa None of your benefits are taxable for 2013. Www freetaxusa For more information, see Repayments More Than Gross Benefits. Www freetaxusa • If you are filing Form 8815, Exclusion of Interest From Series EE and I U. Www freetaxusa S. Www freetaxusa Savings Bonds Issued After 1989, do not include the amount from line 8a of Form 1040 or Form 1040A on line 3 of this worksheet. Www freetaxusa Instead, include the amount from Schedule B (Form 1040A or 1040), line 2. Www freetaxusa 1. Www freetaxusa Enter the total amount from box 5 of ALL your Forms SSA-1099 and RRB-1099. Www freetaxusa Also enter this amount on Form 1040, line 20a, or Form 1040A, line 14a $10,000 2. Www freetaxusa Enter one-half of line 1 5,000 3. Www freetaxusa Combine the amounts from:     Form 1040: Lines 7, 8a, 9a, 10 through 14, 15b, 16b, 17 through 19, and 21. Www freetaxusa     Form 1040A: Lines 7, 8a, 9a, 10, 11b, 12b, and 13 40,500 4. Www freetaxusa Enter the amount, if any, from Form 1040 or 1040A, line 8b -0-       5. Www freetaxusa Enter the total of any exclusions/adjustments for: Adoption benefits (Form 8839, line 28), Foreign earned income or housing (Form 2555, lines 45 and 50, or Form 2555-EZ, line 18), and Certain income of bona fide residents of American Samoa (Form 4563, line 15) or Puerto Rico -0-       6. Www freetaxusa Combine lines 2, 3, 4, and 5 45,500 7. Www freetaxusa Form 1040 filers: Enter the amount from Form 1040, lines 23 through 32, and any write-in adjustments you entered on the dotted line next to line 36. Www freetaxusa     Form 1040A filers: Enter the amount from Form 1040A, lines 16 and 17 -0- 8. Www freetaxusa Is the amount on line 7 less than the amount on line 6?     No. Www freetaxusa None of your social security benefits are taxable. Www freetaxusa Enter -0- on Form 1040, line 20b, or Form 1040A, line 14b. Www freetaxusa   Yes. Www freetaxusa Subtract line 7 from line 6 45,500 9. Www freetaxusa If you are: Married filing jointly, enter $32,000 Single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013, enter $25,000 32,000   Note. Www freetaxusa If you are married filing separately and you lived with your spouse at any time in 2013, skip lines 9 through 16; multiply line 8 by 85% (. Www freetaxusa 85) and enter the result on line 17. Www freetaxusa Then go to line 18. Www freetaxusa   10. Www freetaxusa Is the amount on line 9 less than the amount on line 8?     No. Www freetaxusa None of your benefits are taxable. Www freetaxusa Enter -0- on Form 1040, line 20b, or on Form 1040A, line 14b. Www freetaxusa If you are married filing separately and you lived apart from your spouse for all of 2013, be sure you entered “D” to the right of the word “benefits” on Form 1040, line 20a, or on Form 1040A, line 14a. Www freetaxusa     Yes. Www freetaxusa Subtract line 9 from line 8 13,500 11. Www freetaxusa Enter $12,000 if married filing jointly; $9,000 if single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2013 12,000 12. Www freetaxusa Subtract line 11 from line 10. Www freetaxusa If zero or less, enter -0- 1,500 13. Www freetaxusa Enter the smaller of line 10 or line 11 12,000 14. Www freetaxusa Enter one-half of line 13 6,000 15. Www freetaxusa Enter the smaller of line 2 or line 14 5,000 16. Www freetaxusa Multiply line 12 by 85% (. Www freetaxusa 85). Www freetaxusa If line 12 is zero, enter -0- 1,275 17. Www freetaxusa Add lines 15 and 16 6,275 18. Www freetaxusa Multiply line 1 by 85% (. Www freetaxusa 85) 8,500 19. Www freetaxusa Taxable benefits. Www freetaxusa Enter the smaller of line 17 or line 18. Www freetaxusa Also enter this amount on Form 1040, line 20b, or Form 1040A, line 14b $6,275 More than 50% of Joe's net benefits are taxable because the income on line 8 of the worksheet ($45,500) is more than $44,000. Www freetaxusa Joe and Betty enter $10,000 on Form 1040, line 20a, and $6,275 on Form 1040, line 20b. Www freetaxusa Deductions Related to Your Benefits You may be entitled to deduct certain amounts related to the benefits you receive. Www freetaxusa Disability payments. Www freetaxusa   You may have received disability payments from your employer or an insurance company that you included as income on your tax return in an earlier year. Www freetaxusa If you received a lump-sum payment from SSA or RRB, and you had to repay the employer or insurance company for the disability payments, you can take an itemized deduction for the part of the payments you included in gross income in the earlier year. Www freetaxusa If the amount you repay is more than $3,000, you may be able to claim a tax credit instead. Www freetaxusa Claim the deduction or credit in the same way explained under Repayments More Than Gross Benefits , later. Www freetaxusa Legal expenses. Www freetaxusa   You can usually deduct legal expenses that you pay or incur to produce or collect taxable income or in connection with the determination, collection, or refund of any tax. Www freetaxusa   Legal expenses for collecting the taxable part of your benefits are deductible as a miscellaneous itemized deduction on Schedule A (Form 1040), line 23. Www freetaxusa Repayments More Than Gross Benefits In some situations, your Form SSA-1099 or Form RRB-1099 will show that the total benefits you repaid (box 4) are more than the gross benefits (box 3) you received. Www freetaxusa If this occurred, your net benefits in box 5 will be a negative figure (a figure in parentheses) and none of your benefits will be taxable. Www freetaxusa Do not use a worksheet in this case. Www freetaxusa If you receive more than one form, a negative figure in box 5 of one form is used to offset a positive figure in box 5 of another form for that same year. Www freetaxusa If you have any questions about this negative figure, contact your local SSA office or your local RRB field office. Www freetaxusa Joint return. Www freetaxusa   If you and your spouse file a joint return, and your Form SSA-1099 or RRB-1099 has a negative figure in box 5, but your spouse's does not, subtract the amount in box 5 of your form from the amount in box 5 of your spouse's form. Www freetaxusa You do this to get your net benefits when figuring if your combined benefits are taxable. Www freetaxusa Example. Www freetaxusa John and Mary file a joint return for 2013. Www freetaxusa John received Form SSA-1099 showing $3,000 in box 5. Www freetaxusa Mary also received Form SSA-1099 and the amount in box 5 was ($500). Www freetaxusa John and Mary will use $2,500 ($3,000 minus $500) as the amount of their net benefits when figuring if any of their combined benefits are taxable. Www freetaxusa Repayment of benefits received in an earlier year. Www freetaxusa   If the total amount shown in box 5 of all of your Forms SSA-1099 and RRB-1099 is a negative figure, you can take an itemized deduction for the part of this negative figure that represents benefits you included in gross income in an earlier year. Www freetaxusa Deduction $3,000 or less. Www freetaxusa   If this deduction is $3,000 or less, it is subject to the 2%-of-adjusted-gross-income limit that applies to certain miscellaneous itemized deductions. Www freetaxusa Claim it on Schedule A (Form 1040), line 23. Www freetaxusa Deduction more than $3,000. Www freetaxusa    If this deduction is more than $3,000, you should figure your tax two ways: Figure your tax for 2013 with the itemized deduction included on Schedule A, line 28. Www freetaxusa Figure your tax for 2013 in the following steps. Www freetaxusa Figure the tax without the itemized deduction included on Schedule A, line 28. Www freetaxusa For each year after 1983 for which part of the negative figure represents a repayment of benefits, refigure your taxable benefits as if your total benefits for the year were reduced by that part of the negative figure. Www freetaxusa Then refigure the tax for that year. Www freetaxusa Subtract the total of the refigured tax amounts in (b) from the total of your actual tax amounts. Www freetaxusa Subtract the result in (c) from the result in (a). Www freetaxusa Compare the tax figured in methods (1) and (2). Www freetaxusa Your tax for 2013 is the smaller of the two amounts. Www freetaxusa If method (1) results in less tax, take the itemized deduction on Schedule A (Form 1040), line 28. Www freetaxusa If method (2) results in less tax, claim a credit for the amount from step 2(c) above on Form 1040, line 71. Www freetaxusa Check box d and enter “I. Www freetaxusa R. Www freetaxusa C. Www freetaxusa 1341” in the space next to that box. Www freetaxusa If both methods produce the same tax, deduct the repayment on Schedule A (Form 1040), line 28. Www freetaxusa Prev  Up  Next   Home   More Online Publications
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Www freetaxusa Publication 584 - Introductory Material Table of Contents What's New Introduction How To Use This Workbook What's New Future developments. Www freetaxusa  The IRS has created a page on IRS. Www freetaxusa gov for information about Publication 584, at www. Www freetaxusa irs. Www freetaxusa gov/pub584. Www freetaxusa Information about any future developments affecting Publication 584 (such as legislation enacted after we release it) will be posted on that page. Www freetaxusa Introduction This workbook is designed to help you figure your loss on personal-use property in the event of a disaster, casualty, or theft. Www freetaxusa It contains schedules to help you figure the loss to your main home, its contents, and your motor vehicles. Www freetaxusa However, these schedules are for your information only. Www freetaxusa You must complete Form 4684, Casualties and Thefts, to report your loss. Www freetaxusa How To Use This Workbook You can use this workbook by following these five steps. Www freetaxusa Read Publication 547 to learn about the tax rules for casualties, disasters, and thefts. Www freetaxusa Know the definitions of cost or other basis and fair market value, discussed later. Www freetaxusa Fill out Schedules 1 through 20. Www freetaxusa Read the instructions for Form 4684. Www freetaxusa Fill out Form 4684 using the information you entered in Schedules 1 through 20. Www freetaxusa Use the chart below to find out how to use Schedules 1 through 19 to fill out Form 4684. Www freetaxusa Take what's in each row of. Www freetaxusa . Www freetaxusa . Www freetaxusa And enter it on Form 4684. Www freetaxusa . Www freetaxusa . Www freetaxusa Column 1 Line 1 Column 2 Line 2 Column 3 Line 3 Column 4 Line 4 Column 5 Line 5 Column 6 Line 6 Column 7 Line 7 Column 8 Line 8 Column 9 Line 9 Prev  Up  Next   Home   More Online Publications