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Www irs gov efile com Publication 4492-B - Main Content Table of Contents DefinitionsMidwestern Disaster Areas Applicable Disaster Date Charitable Giving IncentivesTemporary Suspension of Limits on Charitable Contributions Standard Mileage Rate for Charitable Use of Vehicles Mileage Reimbursements to Charitable Volunteers Casualty and Theft LossesTime limit for making election. Www irs gov efile com Replacement Period for Nonrecognition of Gain Net Operating Losses IRAs and Other Retirement PlansDefinitions Taxation of Qualified Disaster Recovery Assistance Distributions Repayment of Qualified Disaster Recovery Assistance Distributions Repayment of Qualified Distributions for the Purchase or Construction of a Main Home Loans From Qualified Plans Additional Tax Relief for IndividualsEarned Income Credit and Child Tax Credit Additional Exemption for Housing Individuals Displaced by the Severe Storms, Tornadoes, or Flooding Education Credits Recapture of Federal Mortgage Subsidy Exclusion of Certain Cancellations of Indebtedness by Reason of the Severe Storms, Tornadoes, or Flooding Tax Relief for Temporary Relocation Additional Tax Relief for BusinessesEmployee Retention Credit Employer Housing Credit and Exclusion Demolition and Clean-up Costs Increase in Rehabilitation Tax Credit Request for Copy or Transcript of Tax Return How To Get Tax HelpLow Income Taxpayer Clinics (LITCs). Www irs gov efile com Definitions The following definitions are used throughout this publication. Www irs gov efile com Midwestern Disaster Areas A Midwestern disaster area is an area for which a major disaster was declared by the President during the period beginning on May 20, 2008, and ending on July 31, 2008, in the state of Arkansas, Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri, Nebraska, or Wisconsin, as a result of severe storms, tornadoes, or flooding that occurred on the applicable disaster date. Www irs gov efile com See Tables 1 and 2 for a list of the counties included in the Midwestern disaster areas. Www irs gov efile com Applicable Disaster Date The term “applicable disaster date” as used in this publication, refers to the date on which the severe storms, tornadoes, or flooding occurred in the Midwestern disaster areas. Www irs gov efile com You will need to know this date when using this publication for the various tax provisions. Www irs gov efile com Table 1 The counties listed in Table 1 below are eligible for all tax provisions shown in this publication. Www irs gov efile com Applicable Disaster Dates* State Affected Counties—Midwestern Disaster Areas 05/02/2008through05/12/2008 Arkansas Arkansas, Benton, Cleburne, Conway, Crittenden, Grant, Lonoke, Mississippi, Phillips, Pulaski, Saline, and Van Buren. Www irs gov efile com 06/01/2008through07/22/2008 Illinois Adams, Calhoun, Clark, Coles, Crawford, Cumberland, Douglas, Edgar, Hancock, Henderson, Jasper, Jersey, Lake, Lawrence, Mercer, Rock Island, Whiteside, and Winnebago. Www irs gov efile com 05/30/2008through06/27/2008 Indiana Adams, Bartholomew, Brown, Clay, Daviess, Dearborn, Decatur, Gibson, Grant, Greene, Hamilton, Hancock, Hendricks, Henry, Huntington, Jackson, Jefferson, Jennings, Johnson, Knox, Lawrence, Madison, Marion, Monroe, Morgan, Owen, Parke, Pike, Posey, Putnam, Randolph, Ripley, Rush, Shelby, Sullivan, Tippecanoe, Vermillion, Vigo, Washington, and Wayne. Www irs gov efile com 05/25/2008through08/13/2008 Iowa Adair, Adams, Allamakee, Appanoose, Audubon, Benton, Black Hawk, Boone, Bremer, Buchanan, Butler, Cass, Cedar, Cerro Gordo, Chickasaw, Clarke, Clayton, Clinton, Crawford, Dallas, Davis, Decatur, Delaware, Des Moines, Dubuque, Fayette, Floyd, Franklin, Fremont, Greene, Grundy, Guthrie, Hamilton, Hancock, Hardin, Harrison, Henry, Howard, Humboldt, Iowa, Jackson, Jasper, Johnson, Jones, Keokuk, Kossuth, Lee, Linn, Louisa, Lucas, Madison, Mahaska, Marion, Marshall, Mills, Mitchell, Monona, Monroe, Montgomery, Muscatine, Page, Polk, Pottawattamie, Poweshiek, Ringgold, Scott, Story, Tama, Union, Van Buren, Wapello, Warren, Washington, Webster, Winnebago, Winneshiek, Worth, and Wright. Www irs gov efile com 05/10/2008through05/11/2008 Missouri Barry, Jasper, and Newton. Www irs gov efile com 06/01/2008through08/13/2008 Missouri Adair, Andrew, Callaway, Cass, Chariton, Clark, Gentry, Greene, Harrison, Holt, Johnson, Lewis, Lincoln, Linn, Livingston, Macon, Marion, Monroe, Nodaway, Pike, Putnam, Ralls, St. Www irs gov efile com Charles, Stone, Taney, Vernon, and Webster. Www irs gov efile com 05/22/2008through06/24/2008 Nebraska Buffalo, Butler, Colfax, Custer, Dawson, Douglas, Gage, Hamilton, Holt, Jefferson, Kearney, Lancaster, Platte, Richardson, Sarpy, and Saunders. Www irs gov efile com 06/05/2008through07/25/2008 Wisconsin Adams, Calumet, Crawford, Columbia, Dane, Dodge, Fond du Lac, Grant, Green, Green Lake, Iowa, Jefferson, Juneau, Kenosha, La Crosse, Manitowoc, Marquette, Milwaukee, Monroe, Ozaukee, Racine, Richland, Rock, Sauk, Sheboygan, Vernon, Walworth, Washington, Waukesha, and Winnebago. Www irs gov efile com *For more details, go to www. Www irs gov efile com fema. Www irs gov efile com gov Table 2 The counties listed in Table 2 below are eligible for all of the special tax provisions shown in this publication except the following. Www irs gov efile com Charitable Giving Incentives. Www irs gov efile com Net Operating Losses. Www irs gov efile com Education Credits. Www irs gov efile com Recapture of Federal Mortgage Subsidy. Www irs gov efile com Tax Relief for Temporary Relocation. Www irs gov efile com Employee Retention Credit. Www irs gov efile com Employer Housing Credit and Exclusion. Www irs gov efile com Demolition and Clean-up Costs. Www irs gov efile com Increase in Rehabilitation Credit. Www irs gov efile com Applicable Disaster Dates* State Affected Counties—Midwestern Disaster Areas 06/01/2008through07/22/2008 Illinois Greene, Madison, Monroe, Pike, Randolph, St. Www irs gov efile com Clair, and Scott. Www irs gov efile com 05/30/2008through06/27/2008 Indiana Benton, Boone, Fountain, Franklin, Jay, Montgomery, Ohio, Switzerland, Union, and Wabash. Www irs gov efile com 05/25/2008through08/13/2008 Iowa Carroll, Cherokee, Lyon, Palo Alto, Pocahontas, Taylor, and Wayne. Www irs gov efile com 05/22/2008through06/16/2008 Kansas Barber, Barton, Bourbon, Brown, Butler, Chautauqua, Cherokee, Clark, Clay, Comanche, Cowley, Crawford, Decatur, Dickinson, Edwards, Elk, Ellis, Ellsworth, Franklin, Gove, Graham, Harper, Haskell, Hodgeman, Jackson, Jewell, Kingman, Kiowa, Lane, Linn, Logan, Mitchell, Montgomery, Ness, Norton, Osborne, Pawnee, Phillips, Pratt, Reno, Republic, Riley, Rooks, Rush, Saline, Seward, Sheridan, Smith, Stafford, Sumner, Thomas, Trego, Wallace, and Wilson. Www irs gov efile com 06/06/2008through06/13/2008 Michigan Allegan, Barry, Eaton, Ingham, Lake, Manistee, Mason, Missaukee, Osceola, Ottawa, Saginaw, and Wexford. Www irs gov efile com 06/06/2008through06/12/2008 Minnesota Cook, Fillmore, Freeborn, Houston, Mower, and Nobles. Www irs gov efile com 06/01/2008through08/13/2008 Missouri Atchison, Audrain, Bates, Buchanan, Cape Girardeau, Carroll, Christian, Daviess, Grundy, Howard, Jefferson, Knox, Mercer, Miller, Mississippi, Morgan, New Madrid, Pemiscot, Perry, Pettis, Platte, Polk, Randolph, Ray, Saline, Schuyler, Scotland, Shelby, St. Www irs gov efile com Genevieve, St. Www irs gov efile com Louis, the Independent City of St. Www irs gov efile com Louis, Scott, Sullivan, and Worth. Www irs gov efile com 04/23/2008through04/26/2008 Nebraska Gage, Johnson, Morrill, Nemaha, and Pawnee. Www irs gov efile com 05/22/2008through06/24/2008 Nebraska Adams, Blaine, Boone, Boyd, Brown, Burt, Cass, Chase, Cherry, Cuming, Dundy, Fillmore, Frontier, Furnas, Garfield, Gosper, Greeley, Hall, Hayes, Howard, Johnson, Keya Paha, Lincoln, Logan, Loup, Merrick, McPherson, Morrill, Nance, Nemaha, Otoe, Phelps, Polk, Red Willow, Rock, Saline, Seward, Sherman, Stanton, Thayer, Thomas, Thurston, Valley, Webster, Wheeler, and York. Www irs gov efile com 06/27/2008 Nebraska Dodge, Douglas, Sarpy, and Saunders. Www irs gov efile com 06/05/2008through07/25/2008 Wisconsin Lafayette. Www irs gov efile com * For more details, go to www. Www irs gov efile com fema. Www irs gov efile com gov Charitable Giving Incentives Temporary Suspension of Limits on Charitable Contributions This benefit applies only to the counties in Table 1. Www irs gov efile com Individuals. Www irs gov efile com   Qualified contributions are not subject to the overall limit on itemized deductions or the 50% of adjusted gross income (AGI) limit. Www irs gov efile com A qualified contribution is a charitable contribution paid in cash or by check to a 50% limit organization if you make an election to have the 50% limit not apply to these contributions. Www irs gov efile com   A qualified contribution must also meet all of the following requirements. Www irs gov efile com Be paid after May 1, 2008, and before January 1, 2009. Www irs gov efile com The contribution must be for relief efforts in one or more Midwestern disaster areas. Www irs gov efile com Documentation must be provided by the donee organization that the contribution was used (or will be used) for relief efforts in one or more Midwestern disaster areas. Www irs gov efile com   Your deduction for qualified contributions is limited to your AGI minus your deduction for all other charitable contributions. Www irs gov efile com You can carry over any contributions you are not able to deduct for 2008 because of this limit. Www irs gov efile com In 2009, the carryover of your unused qualified contributions is subject to the 50% of AGI limit. Www irs gov efile com Exception. Www irs gov efile com   Qualified contributions do not include contributions to certain private foundations described in section 509(a)(3) or contributions for the establishment of a new, or maintenance of an existing, donor advised fund. Www irs gov efile com Corporations. Www irs gov efile com   A corporation can elect to deduct qualified cash contributions without regard to the 10% of taxable income limit if the contributions were paid after May 1, 2008, and before January 1, 2009, to a qualified charitable organization (other than certain private foundations described in section 509(a)(3) or contributions for the establishment of a new, or maintenance of an existing, donor advised fund), for relief efforts in one or more Midwestern disaster areas. Www irs gov efile com Documentation must be provided by the donee organization that the contribution was used (or will be used) for relief efforts in one or more Midwestern disaster areas. Www irs gov efile com The corporation's deduction for these qualified contributions is limited to 100% of taxable income (as modified for the 10% limit) minus the corporation's deduction for all other charitable contributions. Www irs gov efile com Any qualified contributions over this limit can be carried over to the next 5 years, subject to the 10% of taxable income limit. Www irs gov efile com Partners and shareholders. Www irs gov efile com   Each partner in a partnership and each shareholder in an S corporation must make a separate election to have the appropriate limit not apply. Www irs gov efile com More information. Www irs gov efile com   For more information, see Publication 526 or Publication 542, Corporations. Www irs gov efile com Publication 526 includes a worksheet you can use to figure your deduction if any limits apply to your charitable contributions. Www irs gov efile com Standard Mileage Rate for Charitable Use of Vehicles This benefit applies only to the counties in Table 1. Www irs gov efile com The following are special standard mileage rates in effect for 2008 for the cost of operating your vehicle for providing charitable services related only to the severe storms, tornadoes, or flooding. Www irs gov efile com 36 cents per mile for the period beginning on the applicable disaster date through June 30, 2008. Www irs gov efile com 41 cents per mile for the period July 1 through December 31, 2008. Www irs gov efile com Mileage Reimbursements to Charitable Volunteers This benefit applies only to the counties in Table 1. Www irs gov efile com You can exclude from income amounts you receive as mileage reimbursements for the use of a private passenger vehicle for the benefit of a qualified charitable organization in providing relief related to the severe storms, tornadoes, or flooding during the period beginning on the applicable disaster date, and ending on December 31, 2008. Www irs gov efile com You cannot claim a deduction or credit for amounts you exclude. Www irs gov efile com You must keep records of miles driven, time, place (or use), and purpose of the mileage. Www irs gov efile com The amount you can exclude cannot exceed the standard business mileage rate (shown below) for expenses incurred during the following periods. Www irs gov efile com 50. Www irs gov efile com 5 cents per mile for the period beginning on the applicable disaster date through June 30, 2008. Www irs gov efile com 58. Www irs gov efile com 5 cents per mile for the period July 1 through December 31, 2008. Www irs gov efile com Casualty and Theft Losses This benefit applies to the counties in both Tables 1 and 2. Www irs gov efile com The following paragraphs explain changes to casualty and theft losses that were caused by the severe storms, tornadoes, or flooding in the Midwestern disaster areas. Www irs gov efile com For more information, see Publication 547. Www irs gov efile com Limits on personal casualty or theft losses. Www irs gov efile com   Losses of personal use property that arose in a Midwestern disaster area on or after the applicable disaster date are not subject to the $100 or 10% of AGI limits. Www irs gov efile com Qualifying losses include losses from casualties and thefts that arose in a Midwestern disaster area that were attributable to the severe storms, tornadoes, or flooding. Www irs gov efile com When completing Form 4684, do not include on line 17 any losses that arose in a Midwestern disaster area. Www irs gov efile com A loss arising in a Midwestern disaster area is not considered a loss attributable to a federally declared disaster for purposes of that line and cannot be added to your standard deduction. Www irs gov efile com When to deduct the loss. Www irs gov efile com   Casualty and theft losses are generally deductible only in the year the casualty occurred or the theft was discovered. Www irs gov efile com However, you can elect to deduct losses caused by the severe storms, tornadoes, or flooding on your return for the prior year. Www irs gov efile com Special instructions for individuals who elect to claim a Midwestern disaster area casualty or theft loss for 2007. Www irs gov efile com   Individuals filing or amending their 2007 tax return for casualty or theft losses that were attributable to the severe storms, tornadoes, or flooding should: Enter “Midwestern Disaster Area” at the top of Form 1040 or Form 1040X, and Complete the 2008 version of Form 4684. Www irs gov efile com Cross out “2008” and enter “2007” at the top of Form 4684. Www irs gov efile com Time limit for making election. Www irs gov efile com   You must make this election to claim your casualty or theft loss in 2007 by the later of the following dates. Www irs gov efile com The due date (without extensions) for filing your 2008 income tax return. Www irs gov efile com The due date (with extensions) for filing your 2007 income tax return. Www irs gov efile com Example. Www irs gov efile com If you are a calendar year individual taxpayer, you have until April 15, 2009, to amend your 2007 tax return to claim a casualty or theft loss that occurred during 2008. Www irs gov efile com Replacement Period for Nonrecognition of Gain This benefit applies to the counties in both Tables 1 and 2. Www irs gov efile com Generally, an involuntary conversion occurs when property is damaged, destroyed, stolen, seized, requisitioned, or condemned, and you receive other property or money in payment, such as insurance or a condemnation award. Www irs gov efile com Generally, you do not have to report a gain (if any) if you replace the property within 2 years (4 years for a main home in a federally declared disaster area). Www irs gov efile com However, for property that was involuntarily converted on or after the applicable disaster date, as a result of the severe storms, tornadoes, or flooding, a 5-year replacement period applies if substantially all of the use of the replacement property is in a Midwestern disaster area. Www irs gov efile com For more information, see the Instructions for Form 4684. Www irs gov efile com Net Operating Losses This benefit applies only to the counties in Table 1. Www irs gov efile com Qualified disaster recovery assistance loss. Www irs gov efile com   Generally, you can carry a net operating loss (NOL) back to the 2 tax years before the NOL year. Www irs gov efile com However, the portion of an NOL that is a qualified disaster recovery assistance loss can be carried back to the 5 tax years before the NOL year. Www irs gov efile com In addition, the 90% limit on the alternative tax NOL deduction (ATNOLD) does not apply to such portion of the ATNOLD. Www irs gov efile com   A qualified disaster recovery assistance loss is the smaller of: The excess of the NOL for the year over the specified liability loss for the year to which a 10-year carryback applies, or The total of the following deductions (to the extent they are taken into account in computing the NOL for the tax year): Qualified disaster recovery assistance casualty loss (as defined below), Moving expenses paid or incurred on or after the applicable disaster date, and before January 1, 2011, for the employment of an individual whose main home was in a Midwestern disaster area before the applicable disaster date, who was unable to remain in that home because of the severe storms, tornadoes, or flooding, and whose main job location (after the move) is in a Midwestern disaster area, Temporary housing expenses paid or incurred on or after the applicable disaster date, and before January 1, 2011, to house employees of the taxpayer whose main job location is in a Midwestern disaster area, Depreciation or amortization allowable for any qualified disaster recovery assistance property (even if you elected not to claim the special disaster recovery assistance depreciation allowance for such property) for the year placed in service, and Repair expenses (including expenses for the removal of debris) paid or incurred on or after the applicable disaster date, and before January 1, 2011, for any damage from the severe storms, tornadoes, or flooding to property located in a Midwestern disaster area. Www irs gov efile com Qualified disaster recovery assistance casualty loss. Www irs gov efile com   A qualified disaster recovery assistance casualty loss is any deductible section 1231 loss of property located in a Midwestern disaster area if the loss was caused by the severe storms, tornadoes, or flooding. Www irs gov efile com For this purpose, the amount of the loss is reduced by any recognized gain from an involuntary conversion caused by the severe storms, tornadoes, or flooding of property located in a Midwestern disaster area. Www irs gov efile com Any such loss taken into account in figuring your qualified disaster recovery assistance loss is not eligible for the election to be treated as having occurred in the previous tax year. Www irs gov efile com More information. Www irs gov efile com   For more information on NOLs, see Publication 536 or Publication 542, Corporations. Www irs gov efile com IRAs and Other Retirement Plans New rules provide for tax-favored withdrawals, repayments, and loans from certain retirement plans for taxpayers who suffered economic losses as a result of the severe storms, tornadoes, or flooding. Www irs gov efile com Definitions Qualified disaster recovery assistance distribution. Www irs gov efile com   A qualified disaster recovery assistance distribution is any distribution you received from an eligible retirement plan if all of the following apply. Www irs gov efile com The distribution was made on or after the applicable disaster date and before January 1, 2010. Www irs gov efile com Your main home was located in a Midwestern disaster area on the applicable disaster date. Www irs gov efile com You sustained an economic loss because of the severe storms, tornadoes, or flooding and your main home was in a Midwestern disaster area on the applicable disaster date. Www irs gov efile com Examples of an economic loss include, but are not limited to: Loss, damage to, or destruction of real or personal property from fire, flooding, looting, vandalism, theft, wind, or other cause; Loss related to displacement from your home; or Loss of livelihood due to temporary or permanent layoffs. Www irs gov efile com   If (1) through (3) above apply, you can generally designate any distribution (including periodic payments and required minimum distributions) from an eligible retirement plan as a qualified disaster recovery assistance distribution, regardless of whether the distribution was made on account of the severe storms, tornadoes, or flooding. Www irs gov efile com Qualified disaster recovery assistance distributions are permitted without regard to your need or the actual amount of your economic loss. Www irs gov efile com   The total of your qualified disaster recovery assistance distributions from all plans is limited to $100,000. Www irs gov efile com If you have distributions in excess of $100,000 from more than one type of plan, such as a 401(k) plan and an IRA, you can allocate the $100,000 limit among the plans any way you choose. Www irs gov efile com   A reduction or offset (on or after the applicable disaster date) of your account balance in an eligible retirement plan in order to repay a loan can also be designated as a qualified disaster recovery assistance distribution. Www irs gov efile com Eligible retirement plan. Www irs gov efile com   An eligible retirement plan can be any of the following. Www irs gov efile com A qualified pension, profit-sharing, or stock bonus plan (including a 401(k) plan). Www irs gov efile com A qualified annuity plan. Www irs gov efile com A tax-sheltered annuity contract. Www irs gov efile com A governmental section 457 deferred compensation plan. Www irs gov efile com A traditional, SEP, SIMPLE, or Roth IRA. Www irs gov efile com Main home. Www irs gov efile com   Generally, your main home is the home where you live most of the time. Www irs gov efile com A temporary absence due to special circumstances, such as illness, education, business, military service, evacuation, or vacation, will not change your main home. Www irs gov efile com Taxation of Qualified Disaster Recovery Assistance Distributions This benefit applies to the counties in both Tables 1 and 2. Www irs gov efile com Qualified disaster recovery assistance distributions are included in income in equal amounts over three years. Www irs gov efile com However, if you elect, you can include the entire distribution in your income in the year it was received. Www irs gov efile com Qualified disaster recovery assistance distributions are not subject to the additional 10% tax (or the additional 25% tax for certain distributions from SIMPLE IRAs) on early distributions from qualified retirement plans (including IRAs). Www irs gov efile com However, any distributions you receive in excess of the $100,000 qualified disaster recovery assistance distribution limit may be subject to the additional tax on early distributions. Www irs gov efile com For more information, see Form 8930. Www irs gov efile com Repayment of Qualified Disaster Recovery Assistance Distributions This benefit applies to the counties in both Tables 1 and 2. Www irs gov efile com If you choose, you generally can repay any portion of a qualified disaster recovery assistance distribution that is eligible for tax-free rollover treatment to an eligible retirement plan. Www irs gov efile com Also, you can repay a qualified disaster recovery assistance distribution made on account of a hardship from a retirement plan. Www irs gov efile com However, see Exceptions later for qualified disaster recovery assistance distributions you cannot repay. Www irs gov efile com You have three years from the day after the date you received the distribution to make a repayment. Www irs gov efile com Amounts that are repaid are treated as a qualified rollover and are not included in income. Www irs gov efile com Also, a repayment of a qualified disaster recovery assistance distribution to an IRA is not counted when figuring the one-rollover-per-year limitation. Www irs gov efile com See Form 8930 for more information on how to report repayments. Www irs gov efile com Exceptions. Www irs gov efile com   You cannot repay the following types of distributions. Www irs gov efile com Qualified disaster recovery assistance distributions received as a beneficiary (other than a surviving spouse). Www irs gov efile com Required minimum distributions. Www irs gov efile com Periodic payments (other than from an IRA) that are for: A period of 10 years or more, Your life or life expectancy, or The joint lives or joint life expectancies of you and your beneficiary. Www irs gov efile com Repayment of Qualified Distributions for the Purchase or Construction of a Main Home This benefit applies to the counties in both Tables 1 and 2. Www irs gov efile com If you received a qualified distribution to purchase or construct a main home in a Midwestern disaster area, you can repay part or all of that distribution on or after the applicable disaster date, but no later than March 3, 2009, to an eligible retirement plan. Www irs gov efile com For this purpose, an eligible retirement plan is any plan, annuity, or IRA to which a qualified rollover can be made. Www irs gov efile com To be a qualified distribution, the distribution must meet all of the following requirements. Www irs gov efile com The distribution is a hardship distribution from a 401(k) plan, a hardship distribution from a tax-sheltered annuity contract, or a qualified first-time homebuyer distribution from an IRA. Www irs gov efile com The distribution was received after the date that was 6 months before the day after the applicable disaster date. Www irs gov efile com The distribution was to be used to purchase or construct a main home in a Midwestern disaster area that was not purchased or constructed because of the severe storms, tornadoes, or flooding. Www irs gov efile com Amounts that are repaid before March 4, 2009, are treated as a qualified rollover and are not included in income. Www irs gov efile com Also, a repayment of a qualified distribution to an IRA is not counted when figuring the one-rollover-per-year limitation. Www irs gov efile com A qualified distribution not repaid before March 4, 2009, may be taxable for 2007 or 2008 and subject to the additional 10% tax (or the additional 25% tax for certain SIMPLE IRAs) on early distributions. Www irs gov efile com You must file Form 8930 if you received a qualified distribution that you repaid, in whole or in part, before March 4, 2009. Www irs gov efile com Loans From Qualified Plans This benefit applies to the counties in both Tables 1 and 2. Www irs gov efile com The following benefits are available to qualified individuals. Www irs gov efile com Increases to the limits for distributions treated as loans from employer plans. Www irs gov efile com A 1-year suspension for payments due on plan loans. Www irs gov efile com Qualified individual. Www irs gov efile com   You are a qualified individual if your main home was located in a Midwestern disaster area on the applicable disaster date and you had an economic loss because of the severe storms, tornadoes, or flooding. Www irs gov efile com Examples of an economic loss include, but are not limited to: Loss, damage to, or destruction of real or personal property from fire, flooding, looting, vandalism, theft, wind, or other cause; Loss related to displacement from your home; or Loss of livelihood due to temporary or permanent layoffs. Www irs gov efile com Limits on plan loans. Www irs gov efile com   The $50,000 limit for distributions treated as plan loans is increased to $100,000. Www irs gov efile com In addition, the limit based on 50% of your vested accrued benefit is increased to 100% of that benefit. Www irs gov efile com If your main home was located in a Midwestern disaster area, the higher limits apply only to loans received during the period beginning on October 3, 2008, and ending on December 31, 2009. Www irs gov efile com One-year suspension of loan payments. Www irs gov efile com   Payments on plan loans outstanding on or after the applicable disaster date, may be suspended for 1 year by the plan administrator. Www irs gov efile com To qualify for the suspension, the due date for any loan payment must occur during the period beginning on the applicable disaster date and ending on December 31, 2009. Www irs gov efile com Additional Tax Relief for Individuals Earned Income Credit and Child Tax Credit This benefit applies to the counties in both Tables 1 and 2. Www irs gov efile com You can elect to use your 2007 earned income to figure your earned income credit (EIC) and additional child tax credit for 2008 if: Your 2008 earned income is less than your 2007 earned income, and At least one of the following statements is true. Www irs gov efile com Your main home on the applicable disaster date was in a Midwestern disaster area as shown in Table 1. Www irs gov efile com Your main home on the applicable disaster date was in a Midwestern disaster area as shown in Table 2, and you were displaced from that home because of the severe storms, tornadoes, or flooding. Www irs gov efile com Earned income. Www irs gov efile com    For the purpose of this election, your earned income for both the EIC and the additional child tax credit is the amount of earned income used to figure your EIC, even if you did not take the EIC and even if that amount is different than your earned income for the additional child tax credit. Www irs gov efile com If you are claiming only the additional child tax credit, you must figure the amount of your earned income for EIC purposes to determine your eligibility to make the election and the amount of the credit. Www irs gov efile com Joint returns. Www irs gov efile com   If you file a joint return, you qualify to make this election even if only one spouse meets the requirements. Www irs gov efile com If you make the election, your 2007 earned income is the sum of your 2007 earned income and your spouse's 2007 earned income. Www irs gov efile com Making the election. Www irs gov efile com   If you make the election to use your 2007 earned income, the election applies for figuring both the EIC and the additional child tax credit. Www irs gov efile com However, you can make the election for the additional child tax credit even if you do not take the EIC. Www irs gov efile com   Electing to use your 2007 earned income can increase or decrease your EIC. Www irs gov efile com Take the following steps to decide whether to make the election. Www irs gov efile com Figure your 2008 EIC using your 2007 earned income. Www irs gov efile com Figure your 2008 additional child tax credit using your 2007 earned income for EIC purposes. Www irs gov efile com Add the results of (1) and (2). Www irs gov efile com Figure your 2008 EIC using your 2008 earned income. Www irs gov efile com Figure your 2008 additional child tax credit using your 2008 earned income for additional child tax credit purposes. Www irs gov efile com Add the results of (4) and (5). Www irs gov efile com Compare the results of (3) and (6). Www irs gov efile com If (3) is larger than (6), it is to your benefit to make the election. Www irs gov efile com If (3) is equal to or smaller than (6), making the election will not help you. Www irs gov efile com   If you elect to use your 2007 earned income and you are claiming the EIC, enter “PYEI” and the amount of your 2007 earned income on the dotted line next to line 64a of Form 1040, on the line next to line 40a of Form 1040A, or in the space to the left of line 8a of Form 1040EZ. Www irs gov efile com   If you elect to use your 2007 earned income and you are claiming the additional child tax credit, enter your 2007 earned income for EIC purposes (even if you did not claim the EIC) on Form 8812, Additional Child Tax Credit, line 4a, and check the box on that line. Www irs gov efile com Getting your 2007 tax return information. Www irs gov efile com   If you do not have your 2007 tax records, you can get the amount of earned income used to figure your 2007 EIC by calling 1-866-562-5227. Www irs gov efile com You can also get this information by visiting the IRS website at www. Www irs gov efile com irs. Www irs gov efile com gov. Www irs gov efile com   If you prefer to figure your 2007 earned income yourself, copies or transcripts of your filed and processed tax returns can help you reconstruct your tax records. Www irs gov efile com See Request for Copy or Transcript of Tax Return on page 11. Www irs gov efile com Additional Exemption for Housing Individuals Displaced by the Severe Storms, Tornadoes, or Flooding This benefit applies to the counties in both Tables 1 and 2. Www irs gov efile com You can claim an additional exemption amount of $500 for providing housing in your main home for each individual displaced by the severe storms, tornadoes, or flooding. Www irs gov efile com The additional exemption amount is claimed on Form 8914. Www irs gov efile com You can claim an additional exemption amount only one time for a specific individual. Www irs gov efile com If you claimed an additional exemption amount for an individual in 2008, you cannot claim that amount again for the same individual in 2009. Www irs gov efile com The maximum additional exemption amount you can claim for all displaced individuals is $2,000. Www irs gov efile com Any additional exemption amount you claimed for displaced individuals in 2008 will reduce the $2,000 maximum for 2009. Www irs gov efile com The $2,000 limit applies to a husband and wife, whether the husband and wife file joint returns or separate returns. Www irs gov efile com If married filing separately, the $2,000 can be divided in $500 increments between the spouses. Www irs gov efile com For example, if one spouse claims an additional exemption amount for one displaced individual, the other spouse, if otherwise eligible, can claim additional exemption amounts for three different displaced individuals. Www irs gov efile com If two or more taxpayers share the same main home, only one taxpayer in that main home can claim the additional exemption amount for a specific displaced individual. Www irs gov efile com In order for you to be considered to have provided housing, you must have a legal interest in the main home (that is, own or rent the home). Www irs gov efile com To qualify as a displaced individual, the individual: Must have had his or her main home in a Midwestern disaster area on the applicable disaster date, and he or she must have been displaced from that home. Www irs gov efile com If the individual's main home was located in a Midwestern disaster area as shown in Table 2, that home must have been damaged by the severe storms, tornadoes, or flooding or the individual must have been evacuated from that home because of the severe storms, tornadoes, or flooding, Must have been provided housing in your main home for a period of at least 60 consecutive days ending in the tax year in which the exemption is claimed, and Cannot be your spouse or dependent. Www irs gov efile com You cannot claim the additional exemption amount if you received rent (or any other amount) from any source for providing the housing. Www irs gov efile com You are permitted to receive payments or reimbursements that do not relate to normal housing costs, including the following. Www irs gov efile com Food, clothing, or personal items consumed or used by the displaced individual. Www irs gov efile com Reimbursement for the cost of any long distance telephone calls made by the displaced individual. Www irs gov efile com Reimbursement for the cost of gasoline for the displaced individual's use of your vehicle. Www irs gov efile com However, you cannot claim the additional exemption amount if you received any reimbursement for the extra costs of heat, electricity, or water used by the displaced individual. Www irs gov efile com Also, you must report on Form 8914 the displaced individual's social security number or individual taxpayer identification number to claim an additional exemption amount. Www irs gov efile com For more information, see Form 8914. Www irs gov efile com Education Credits This benefit applies only to the counties in Table 1. Www irs gov efile com The education credits have been expanded for students attending an eligible educational institution located in a Midwestern disaster area (Midwestern disaster area students) for any tax year beginning in 2008 or 2009. Www irs gov efile com The Hope credit for a Midwestern disaster area student is increased to 100% of the first $2,400 in qualified education expenses and 50% of the next $2,400 of qualified education expenses for a maximum credit of $3,600 per student. Www irs gov efile com The lifetime learning credit rate for a Midwestern disaster area student is increased from 20% to 40%. Www irs gov efile com The definition of qualified education expenses for a Midwestern disaster area student also has been expanded. Www irs gov efile com This expanded definition also applies to the tuition and fees deduction claimed on Form 8917. Www irs gov efile com In addition to tuition and fees required for the student's enrollment or attendance at an eligible educational institution, qualified education expenses for a Midwestern disaster area student include the following. Www irs gov efile com Books, supplies, and equipment required for enrollment or attendance at an eligible educational institution. Www irs gov efile com For a special needs student, expenses that are necessary for that person's enrollment or attendance at an eligible educational institution. Www irs gov efile com For a student who is at least a half-time student, the reasonable costs of room and board, but only to the extent that the costs are not more than the greater of the following two amounts. Www irs gov efile com The allowance for room and board, as determined by the eligible educational institution, that was included in the cost of attendance (for federal financial aid purposes) for a particular academic period and living arrangement of the student. Www irs gov efile com The actual amount charged if the student is residing in housing owned or operated by the eligible educational institution. Www irs gov efile com You will need to contact the eligible educational institution for qualified room and board costs. Www irs gov efile com For more information, see Form 8863. Www irs gov efile com See Form 8917 for the tuition and fees deduction. Www irs gov efile com Recapture of Federal Mortgage Subsidy This benefit applies only to the counties in Table 1. Www irs gov efile com Generally, if you financed your home under a federally subsidized program (loans from tax-exempt qualified mortgage bonds or loans with mortgage credit certificates), you may have to recapture all or part of the benefit you received from that program when you sell or otherwise dispose of your home. Www irs gov efile com However, you do not have to recapture any benefit if your mortgage loan was a qualified home improvement loan of not more than $15,000. Www irs gov efile com This amount is increased to $150,000 if the loan was provided before 2011 and was used to alter, repair, or improve an existing owner-occupied residence in a Midwestern disaster area as shown in Table 1. Www irs gov efile com Exclusion of Certain Cancellations of Indebtedness by Reason of the Severe Storms, Tornadoes, or Flooding This benefit applies to the counties in both Tables 1 and 2. Www irs gov efile com Generally, discharges of nonbusiness debts (such as mortgages) made on or after the applicable disaster date and before January 1, 2010, are excluded from income for individuals whose main home was in a Midwestern disaster area on the applicable disaster date. Www irs gov efile com If the individual's main home was located in a Midwestern disaster area as shown in Table 2, the individual also must have had an economic loss because of the severe storms, tornadoes, or flooding. Www irs gov efile com Examples of an economic loss include, but are not limited to: Loss, damage to, or destruction of real or personal property from fire, flooding, looting, vandalism, theft, wind, or other cause; Loss related to displacement from your home; or Loss of livelihood due to temporary or permanent layoffs. Www irs gov efile com This relief does not apply to any debt secured by real property located outside a Midwestern disaster area. Www irs gov efile com You may also have to reduce certain tax attributes by the amount excluded. Www irs gov efile com For more information, see Form 982, Reduction of Tax Attributes Due to Discharge of Indebtedness (and Section 1082 Basis Adjustment). Www irs gov efile com Tax Relief for Temporary Relocation This benefit applies only to the counties in Table 1. Www irs gov efile com The IRS can adjust the internal revenue laws to ensure that taxpayers do not lose a deduction or credit or experience a change of filing status in 2008 or 2009 as a result of a temporary relocation caused by the severe storms, tornadoes, or flooding. Www irs gov efile com However, any such adjustment must ensure that an individual is not taken into account by more than one taxpayer for the same tax benefit. Www irs gov efile com The IRS has exercised this authority as follows. Www irs gov efile com In determining whether you furnished over one-half of the cost of maintaining a household, you can exclude from total household costs any assistance received from the government or charitable organizations because you were temporarily relocated as a result of the severe storms, tornadoes, or flooding. Www irs gov efile com In determining whether you provided more than one-half of an individual's support, you can disregard any assistance received from the government or charitable organizations because you were temporarily relocated as a result of the severe storms, tornadoes, or flooding. Www irs gov efile com You can treat as a student an individual who enrolled in school before the applicable disaster date, and who is unable to attend classes because of the severe storms, tornadoes, or flooding, for each month of the enrollment period that individual is prevented by the severe storms, tornadoes, or flooding from attending school as planned. Www irs gov efile com Additional Tax Relief for Businesses Employee Retention Credit This benefit applies only to the counties in Table 1. Www irs gov efile com An eligible employer who conducted an active trade or business in a Midwestern disaster area can claim the employee retention credit. Www irs gov efile com The credit is 40% of qualified wages for each eligible employee (up to a maximum of $6,000 in qualified wages per employee). Www irs gov efile com Generally, you must reduce your deduction for salaries and wages by the amount of this credit (before the tax liability limit). Www irs gov efile com Use Form 5884-A to claim the credit. Www irs gov efile com Employers affected by the severe storms, tornadoes, or flooding. Www irs gov efile com   The following definitions apply to employers affected by the severe storms, tornadoes, or flooding. Www irs gov efile com Eligible employer. Www irs gov efile com   For this purpose, an eligible employer is any employer who meets all of the following. Www irs gov efile com Employed an average of not more than 200 employees on business days during the tax year before the applicable disaster date. Www irs gov efile com Conducted an active trade or business on the applicable disaster date in a Midwestern disaster area. Www irs gov efile com Whose trade or business was inoperable on any day after the applicable disaster date and before January 1, 2009, because of the damage caused by the severe storms, tornadoes, or flooding. Www irs gov efile com Eligible employee. Www irs gov efile com   For this purpose, an eligible employee is an employee whose principal place of employment on the applicable disaster date with such eligible employer was in a Midwestern disaster area. Www irs gov efile com An employee is not an eligible employee for purposes of the severe storms, tornadoes, or flooding if the employee is treated as an eligible employee for the work opportunity credit. Www irs gov efile com Qualified wages. Www irs gov efile com   Qualified wages are wages (up to $6,000 per employee) you paid or incurred before January 1, 2009, for an eligible employee beginning on the date your trade or business first became inoperable at the employee's principal place of employment immediately before the applicable disaster, and ending on the date your trade or business resumed significant operations at that place. Www irs gov efile com In addition, the wages must have been paid or incurred after the applicable disaster date. Www irs gov efile com    This includes wages paid even if the employee performed no services, performed services at a place of employment other than the principal place of employment, or performed services at the principal place of employment before significant operations resumed. Www irs gov efile com    Wages qualifying for the credit generally have the same meaning as wages subject to the Federal Unemployment Tax Act (FUTA). Www irs gov efile com Qualified wages also include amounts you paid for medical or hospitalization expenses in connection with sickness or accident disability. Www irs gov efile com Qualified wages for any employee must be reduced by the amount of any work supplementation payment you received under the Social Security Act. Www irs gov efile com   For agricultural employees, if the work performed by any employee during more than half of any pay period qualified under FUTA as agricultural labor, that employee's wages subject to social security and Medicare taxes are qualified wages. Www irs gov efile com For a special rule that applies to railroad employees, see section 51(h)(1)(B). Www irs gov efile com   Qualified wages do not include the following. Www irs gov efile com Wages paid to your dependent or a related individual. Www irs gov efile com See section 51(i)(1). Www irs gov efile com Wages paid to any employee during the period for which you received payment for the employee from a federally funded on-the-job training program. Www irs gov efile com Wages for services of replacement workers during a strike or lockout. Www irs gov efile com   For more information, see Form 5884-A. Www irs gov efile com Employer Housing Credit and Exclusion This benefit applies only to the counties in Table 1. Www irs gov efile com An employer who conducted an active trade or business in a Midwestern disaster area can claim the employer housing credit. Www irs gov efile com The credit is equal to 30% of the value (up to $600 per month per employee) of in-kind lodging furnished to a qualified employee (and the employee's spouse or dependents) from November 1, 2008, through May 1, 2009. Www irs gov efile com The value of the lodging is excluded from the income of the qualified employee but is treated as wages for purposes of taxes imposed under the Federal Insurance Contributions Act (FICA) and the Federal Unemployment Tax Act (FUTA). Www irs gov efile com Generally, you must reduce your deduction for salaries and wages by the amount of this credit (before the tax liability limit). Www irs gov efile com The employer must use Form 5884-A to claim the credit. Www irs gov efile com A qualified employee is an individual who had a main home in a Midwestern disaster area on the applicable disaster date, and who performs substantially all employment services in a Midwestern disaster area for the employer furnishing the lodging. Www irs gov efile com The employee cannot be your dependent or a related individual. Www irs gov efile com See section 51(i)(1). Www irs gov efile com For more information, see Form 5884-A. Www irs gov efile com Demolition and Clean-up Costs This benefit applies only to the counties in Table 1. Www irs gov efile com You can elect to deduct 50% of any qualified disaster recovery assistance clean-up costs for the tax year in which the costs are paid or incurred, instead of capitalizing them. Www irs gov efile com Qualified disaster recovery assistance clean-up costs are any amounts paid or incurred on or after the applicable disaster date, and before January 1, 2011, for the removal of debris from, or the demolition of structures on, real property located in a Midwestern disaster area that is: Held by you for use in a trade or business or for the production of income, or Inventory or other property held primarily for sale to customers in the ordinary course of your trade or business. Www irs gov efile com Qualified disaster recovery assistance clean-up costs are limited to amounts necessary due to damage attributable to the severe storms, tornadoes, or flooding in the Midwestern disaster areas. Www irs gov efile com Increase in Rehabilitation Tax Credit This benefit applies only to the counties in Table 1. Www irs gov efile com The rehabilitation credit is increased for qualified rehabilitation expenditures paid or incurred on or after the applicable disaster date, and before January 1, 2012, on buildings located in a Midwestern disaster area as follows. Www irs gov efile com For pre-1936 buildings (other than certified historic structures), the credit percentage is increased from 10% to 13%. Www irs gov efile com For certified historic structures, the credit percentage is increased from 20% to 26%. Www irs gov efile com For more information, see Form 3468, Investment Credit. Www irs gov efile com Request for Copy or Transcript of Tax Return Request for copy of tax return. Www irs gov efile com   You can use Form 4506 to order a copy of your tax return. Www irs gov efile com Generally, there is a $57 fee for requesting each copy of a tax return. Www irs gov efile com If your main home, principal place of business, or tax records are located in a Midwestern disaster area, the fee will be waived if “Midwestern Disaster Area” is written in red across the top of the form when filed. Www irs gov efile com Request for transcript of tax return. Www irs gov efile com   You can use Form 4506-T to order a free transcript of your tax return. Www irs gov efile com A transcript provides most of the line entries from a tax return and usually contains the information that a third party requires. Www irs gov efile com You can also call 1-800-829-1040 to order a transcript. Www irs gov efile com How To Get Tax Help Special IRS assistance. Www irs gov efile com   The IRS is providing special help for those affected by the severe storms, tornadoes, or flooding, as well as survivors and personal representatives of the victims. Www irs gov efile com We have set up a special toll-free number for people who may have trouble filing or paying their taxes because they were affected by recent federally declared disasters, or who have other tax issues related to the severe storms, tornadoes, or flooding. Www irs gov efile com Call 1-866-562-5227 Monday through FridayIn English–7 a. Www irs gov efile com m. Www irs gov efile com to 10 p. Www irs gov efile com m. Www irs gov efile com local timeIn Spanish–8 a. Www irs gov efile com m. Www irs gov efile com to 9:30 p. Www irs gov efile com m. Www irs gov efile com local time   The IRS website at www. Www irs gov efile com irs. Www irs gov efile com gov has notices and other tax relief information. Www irs gov efile com Check it periodically for any new guidance. Www irs gov efile com You can get help with unresolved tax issues, order free publications and forms, ask tax questions, and get information from the IRS in several ways. Www irs gov efile com By selecting the method that is best for you, you will have quick and easy access to tax help. Www irs gov efile com Contacting your Taxpayer Advocate. Www irs gov efile com   The Taxpayer Advocate Service (TAS) is an independent organization within the IRS whose employees assist taxpayers who are experiencing economic harm, who are seeking help in resolving tax problems that have not been resolved through normal channels, or who believe that an IRS system or procedure is not working as it should. Www irs gov efile com Here are seven things every taxpayer should know about TAS: TAS is your voice at the IRS. Www irs gov efile com Our service is free, confidential, and tailored to meet your needs. Www irs gov efile com You may be eligible for TAS help if you have tried to resolve your tax problem through normal IRS channels and have gotten nowhere, or you believe an IRS procedure just isn't working as it should. Www irs gov efile com TAS helps taxpayers whose problems are causing financial difficulty or significant cost, including the cost of professional representation. Www irs gov efile com This includes businesses as well as individuals. Www irs gov efile com TAS employees know the IRS and how to navigate it. Www irs gov efile com We will listen to your problem, help you understand what needs to be done to resolve it, and stay with you every step of the way until your problem is resolved. Www irs gov efile com TAS has at least one local taxpayer advocate in every state, the District of Columbia, and Puerto Rico. Www irs gov efile com You can call your local advocate, whose number is in your phone book, in Pub. Www irs gov efile com 1546, Taxpayer Advocate Service—Your Voice at the IRS, and on our website at www. Www irs gov efile com irs. Www irs gov efile com gov/advocate. Www irs gov efile com You can also call our toll-free line at 1-877-777-4778 or TTY/TDD 1-800-829-4059. Www irs gov efile com You can learn about your rights and responsibilities as a taxpayer by visiting our online tax toolkit at www. Www irs gov efile com taxtoolkit. Www irs gov efile com irs. Www irs gov efile com gov. Www irs gov efile com Low Income Taxpayer Clinics (LITCs). Www irs gov efile com   The Low Income Taxpayer Clinic program serves individuals who have a problem with the IRS and whose income is below a certain level. Www irs gov efile com LITCs are independent from the IRS. Www irs gov efile com Most LITCs can provide representation before the IRS or in court on audits, tax collection disputes, and other issues for free or a small fee. Www irs gov efile com If an individual's native language is not English, some clinics can provide multilingual information about taxpayer rights and responsibilities. Www irs gov efile com For more information, see Publication 4134, Low Income Taxpayer Clinic List. Www irs gov efile com This publication is available at www. Www irs gov efile com irs. Www irs gov efile com gov, by calling 1-800-TAX-FORM (1-800-829-3676), or at your local IRS office. Www irs gov efile com Free tax services. Www irs gov efile com   To find out what services are available, get Publication 910, IRS Guide to Free Tax Services. Www irs gov efile com It contains lists of free tax information sources, including publications, services, and free tax education and assistance programs. Www irs gov efile com It also has an index of over 100 TeleTax topics (recorded tax information) you can listen to on your telephone. Www irs gov efile com   Accessible versions of IRS published products are available on request in a variety of alternative formats for people with disabilities. Www irs gov efile com Free help with your return. Www irs gov efile com   Free help in preparing your return is available nationwide from IRS-trained volunteers. Www irs gov efile com The Volunteer Income Tax Assistance (VITA) program is designed to help low-income taxpayers and the Tax Counseling for the Elderly (TCE) program is designed to assist taxpayers age 60 and older with their tax returns. Www irs gov efile com Many VITA sites offer free electronic filing and all volunteers will let you know about credits and deductions you may be entitled to claim. Www irs gov efile com To find the nearest VITA or TCE site, call 1-800-829-1040. Www irs gov efile com   As part of the TCE program, AARP offers the Tax-Aide counseling program. Www irs gov efile com To find the nearest AARP Tax-Aide site, call 1-888-227-7669 or visit AARP's website atwww. Www irs gov efile com aarp. Www irs gov efile com org/money/taxaide. Www irs gov efile com   For more information on these programs, go to www. Www irs gov efile com irs. Www irs gov efile com gov and enter keyword “VITA” in the upper right-hand corner. Www irs gov efile com Internet. Www irs gov efile com You can access the IRS website at www. Www irs gov efile com irs. Www irs gov efile com gov 24 hours a day, 7 days a week to: E-file your return. Www irs gov efile com Find out about commercial tax preparation and e-file services available free to eligible taxpayers. Www irs gov efile com Check the status of your 2009 refund. Www irs gov efile com Go to www. Www irs gov efile com irs. Www irs gov efile com gov and click on Where's My Refund. Www irs gov efile com Wait at least 72 hours after the IRS acknowledges receipt of your e-filed return, or 3 to 4 weeks after mailing a paper return. Www irs gov efile com If you filed Form 8379 with your return, wait 14 weeks (11 weeks if you filed electronically). Www irs gov efile com Have your 2009 tax return available so you can provide your social security number, your filing status, and the exact whole dollar amount of your refund. Www irs gov efile com Download forms, instructions, and publications. Www irs gov efile com Order IRS products online. Www irs gov efile com Research your tax questions online. Www irs gov efile com Search publications online by topic or keyword. Www irs gov efile com Use the online Internal Revenue Code, Regulations, or other official guidance. Www irs gov efile com View Internal Revenue Bulletins (IRBs) published in the last few years. Www irs gov efile com Figure your withholding allowances using the withholding calculator online at www. Www irs gov efile com irs. Www irs gov efile com gov/individuals. Www irs gov efile com Determine if Form 6251 must be filed by using our Alternative Minimum Tax (AMT) Assistant. Www irs gov efile com Sign up to receive local and national tax news by email. Www irs gov efile com Get information on starting and operating a small business. Www irs gov efile com Phone. Www irs gov efile com Many services are available by phone. Www irs gov efile com Ordering forms, instructions, and publications. Www irs gov efile com Call 1-800-TAX FORM (1-800-829-3676) to order current-year forms, instructions, and publications, and prior-year forms and instructions. Www irs gov efile com You should receive your order within 10 days. Www irs gov efile com Asking tax questions. Www irs gov efile com Call the IRS with your tax questions at 1-800-829-1040. Www irs gov efile com Solving problems. Www irs gov efile com You can get face-to-face help solving tax problems every business day in IRS Taxpayer Assistance Centers. Www irs gov efile com An employee can explain IRS letters, request adjustments to your account, or help you set up a payment plan. Www irs gov efile com Call your local Taxpayer Assistance Center for an appointment. Www irs gov efile com To find the number, go to www. Www irs gov efile com irs. Www irs gov efile com gov/localcontacts or look in the phone book under United States Government, Internal Revenue Service. Www irs gov efile com TTY/TDD equipment. Www irs gov efile com If you have access to TTY/TDD equipment, call 1-800-829-4059 to ask tax questions or to order forms and publications. Www irs gov efile com TeleTax topics. Www irs gov efile com Call 1-800-829-4477 to listen to pre-recorded messages covering various tax topics. Www irs gov efile com Refund information. Www irs gov efile com To check the status of your 2009 refund, call 1-800-829-1954 during business hours or 1-800-829-4477 (automated refund information 24 hours a day, 7 days a week). Www irs gov efile com Wait at least 72 hours after the IRS acknowledges receipt of your e-filed return, or 3 to 4 weeks after mailing a paper return. Www irs gov efile com If you filed Form 8379 with your return, wait 14 weeks (11 weeks if you filed electronically). Www irs gov efile com Have your 2009 tax return available so you can provide your social security number, your filing status, and the exact whole dollar amount of your refund. Www irs gov efile com Refunds are sent out weekly on Fridays. Www irs gov efile com If you check the status of your refund and are not given the date it will be issued, please wait until the next week before checking back. Www irs gov efile com Other refund information. Www irs gov efile com To check the status of a prior year refund or amended return refund, call 1-800-829-1954. Www irs gov efile com Evaluating the quality of our telephone services. Www irs gov efile com To ensure IRS representatives give accurate, courteous, and professional answers, we use several methods to evaluate the quality of our telephone services. Www irs gov efile com One method is for a second IRS representative to listen in on or record random telephone calls. Www irs gov efile com Another is to ask some callers to complete a short survey at the end of the call. Www irs gov efile com Walk-in. Www irs gov efile com Many products and services are available on a walk-in basis. Www irs gov efile com Products. Www irs gov efile com You can walk in to many post offices, libraries, and IRS offices to pick up certain forms, instructions, and publications. Www irs gov efile com Some IRS offices, libraries, grocery stores, copy centers, city and county government offices, credit unions, and office supply stores have a collection of products available to print from a CD or photocopy from reproducible proofs. Www irs gov efile com Also, some IRS offices and libraries have the Internal Revenue Code, regulations, Internal Revenue Bulletins, and Cumulative Bulletins available for research purposes. Www irs gov efile com Services. Www irs gov efile com You can walk in to your local Taxpayer Assistance Center every business day for personal, face-to-face tax help. Www irs gov efile com An employee can explain IRS letters, request adjustments to your tax account, or help you set up a payment plan. Www irs gov efile com If you need to resolve a tax problem, have questions about how the tax law applies to your individual tax return, or you are more comfortable talking with someone in person, visit your local Taxpayer Assistance Center where you can spread out your records and talk with an IRS representative face-to-face. Www irs gov efile com No appointment is necessary—just walk in. Www irs gov efile com If you prefer, you can call your local Center and leave a message requesting an appointment to resolve a tax account issue. Www irs gov efile com A representative will call you back within 2 business days to schedule an in-person appointment at your convenience. Www irs gov efile com If you have an ongoing, complex tax account problem or a special need, such as a disability, an appointment can be requested. Www irs gov efile com All other issues will be handled without an appointment. Www irs gov efile com To find the number of your local office, go to www. Www irs gov efile com irs. Www irs gov efile com gov/localcontacts or look in the phone book under United States Government, Internal Revenue Service. Www irs gov efile com Mail. Www irs gov efile com You can send your order for forms, instructions, and publications to the address below. Www irs gov efile com You should receive a response within 10 days after your request is received. Www irs gov efile com Internal Revenue Service1201 N. Www irs gov efile com Mitsubishi MotorwayBloomington, IL 61705-6613 DVD for tax products. Www irs gov efile com You can order Publication 1796, IRS Tax Products DVD, and obtain: Current-year forms, instructions, and publications. Www irs gov efile com Prior-year forms, instructions, and publications. Www irs gov efile com Tax Map: an electronic research tool and finding aid. Www irs gov efile com Tax law frequently asked questions. Www irs gov efile com Tax Topics from the IRS telephone response system. Www irs gov efile com Internal Revenue Code—Title 26 of the U. Www irs gov efile com S. Www irs gov efile com Code. Www irs gov efile com Fill-in, print, and save features for most tax forms. Www irs gov efile com Internal Revenue Bulletins. Www irs gov efile com Toll-free and email technical support. Www irs gov efile com Two releases during the year. Www irs gov efile com – The first release will ship the beginning of January 2010. Www irs gov efile com – The final release will ship the beginning of March 2010. Www irs gov efile com Purchase the DVD from National Technical Information Service (NTIS) at www. Www irs gov efile com irs. Www irs gov efile com gov/cdorders for $30 (no handling fee) or call 1-877-233-6767 toll free to buy the DVD for $30 (plus a $6 handling fee). Www irs gov efile com Prev  Up  Next   Home   More Online Publications
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Consumer Protection Offices

City, county, regional, and state consumer offices offer a variety of important services. They might mediate complaints, conduct investigations, prosecute offenders of consumer laws, license and regulate professional service providers, provide educational materials and advocate for consumer rights. To save time, call before sending a written complaint. Ask if the office handles the type of complaint you have and if complaint forms are provided.

City Consumer Protection Offices

Department of Consumer and Regulatory Affairs

Website: Department of Consumer and Regulatory Affairs ((DC consumer website)) http://www.dcra.dc.gov

Address: Department of Consumer and Regulatory Affairs
1100 4th St., SW
Washington, DC 20024

Phone Number: 202-442-4400

TTY: 202-123-4567

Office of the Attorney General

Website: Office of the Attorney General ((DC consumer website)) http://www.oag.dc.gov

Address: Office of the Attorney General
Consumer Protection and Antitrust
441 4th St., NW
Washington, DC 20001

Phone Number: 202-442-9828 (Hotline)

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Banking Authorities

The officials listed in this section regulate and supervise state-chartered banks. Many of them handle or refer problems and complaints about other types of financial institutions as well. Some also answer general questions about banking and consumer credit. If you are dealing with a federally chartered bank, check Federal Agencies.

Department of Insurance, Securities and Banking

Website: Department of Insurance, Securities and Banking

Address: Department of Insurance, Securities and Banking
810 1st St., NE, Suite 701
Attn: Consumer Protection Advocate
Washington, DC 20002

Phone Number: 202-727-8000

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Insurance Regulators

Each state has its own laws and regulations for each type of insurance. The officials listed in this section enforce these laws. Many of these offices can also provide you with information to help you make informed insurance buying decisions.

Department of Insurance, Securities and Banking

Website: Department of Insurance, Securities and Banking

Address: Department of Insurance, Securities and Banking
810 First St., NE, Suite 701
Attn: Consumer Services Division
Washington, DC 20002

Phone Number: 202-727-8000

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Securities Administrators

Each state has its own laws and regulations for securities brokers and securities - including stocks, mutual funds, commodities, real estate, etc. The officials and agencies listed in this section enforce these laws and regulations. Many of these offices can also provide information to help you make informed investment decisions.

Department of Insurance, Securities and Banking

Website: Department of Insurance, Securities and Banking

Address: Department of Insurance, Securities and Banking
Consumer Protection Advocate
810 1st St., NE, Suite 701
Washington, DC 20002

Phone Number: 202-727-8000

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Utility Commissions

State Utility Commissions regulate services and rates for gas, electricity and telephones within your state. In some states, the utility commissions regulate other services such as water, transportation, and the moving of household goods. Many utility commissions handle consumer complaints. Sometimes, if a number of complaints are received about the same utility matter, they will conduct investigations.

Public Service Commission

Website: Public Service Commission

Address: Public Service Commission
Office of Consumer Services
1333 H St., NW, Suite 600
Washington, DC 20005

Phone Number: 202-626-5120

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The Www Irs Gov Efile Com

Www irs gov efile com Publication 575 - Main Content Table of Contents General InformationPension. Www irs gov efile com Annuity. Www irs gov efile com Qualified employee plan. Www irs gov efile com Qualified employee annuity. Www irs gov efile com Designated Roth account. Www irs gov efile com Tax-sheltered annuity plan. Www irs gov efile com Fixed-period annuities. Www irs gov efile com Annuities for a single life. Www irs gov efile com Joint and survivor annuities. Www irs gov efile com Variable annuities. Www irs gov efile com Disability pensions. Www irs gov efile com Variable Annuities Section 457 Deferred Compensation Plans Disability Pensions Insurance Premiums for Retired Public Safety Officers Railroad Retirement Benefits Withholding Tax and Estimated Tax Cost (Investment in the Contract)Foreign employment contributions while a nonresident alien. Www irs gov efile com Taxation of Periodic PaymentsPeriod of participation. Www irs gov efile com Fully Taxable Payments Partly Taxable Payments Taxation of Nonperiodic PaymentsFiguring the Taxable Amount Loans Treated as Distributions Transfers of Annuity Contracts Lump-Sum Distributions RolloversExceptions. Www irs gov efile com No tax withheld. Www irs gov efile com Partial rollovers. Www irs gov efile com Frozen deposits. Www irs gov efile com Reasonable period of time. Www irs gov efile com 20% Mandatory withholding. Www irs gov efile com How to report. Www irs gov efile com How to report. Www irs gov efile com Special rule for Roth IRAs and designated Roth accounts. Www irs gov efile com Special Additional TaxesTax on Early Distributions Tax on Excess Accumulation Survivors and BeneficiariesGuaranteed payments. Www irs gov efile com How To Get Tax HelpLow Income Taxpayer Clinics General Information Definitions. Www irs gov efile com   Some of the terms used in this publication are defined in the following paragraphs. Www irs gov efile com Pension. Www irs gov efile com   A pension is generally a series of definitely determinable payments made to you after you retire from work. Www irs gov efile com Pension payments are made regularly and are based on such factors as years of service and prior compensation. Www irs gov efile com Annuity. Www irs gov efile com   An annuity is a series of payments under a contract made at regular intervals over a period of more than one full year. Www irs gov efile com They can be either fixed (under which you receive a definite amount) or variable (not fixed). Www irs gov efile com You can buy the contract alone or with the help of your employer. Www irs gov efile com Qualified employee plan. Www irs gov efile com   A qualified employee plan is an employer's stock bonus, pension, or profit-sharing plan that is for the exclusive benefit of employees or their beneficiaries and that meets Internal Revenue Code requirements. Www irs gov efile com It qualifies for special tax benefits, such as tax deferral for employer contributions and capital gain treatment or the 10-year tax option for lump-sum distributions (if participants qualify). Www irs gov efile com To determine whether your plan is a qualified plan, check with your employer or the plan administrator. Www irs gov efile com Qualified employee annuity. Www irs gov efile com   A qualified employee annuity is a retirement annuity purchased by an employer for an employee under a plan that meets Internal Revenue Code requirements. Www irs gov efile com Designated Roth account. Www irs gov efile com   A designated Roth account is a separate account created under a qualified Roth contribution program to which participants may elect to have part or all of their elective deferrals to a 401(k), 403(b), or 457(b) plan designated as Roth contributions. Www irs gov efile com Elective deferrals that are designated as Roth contributions are included in your income. Www irs gov efile com However, qualified distributions (explained later) are not included in your income. Www irs gov efile com You should check with your plan administrator to determine if your plan will accept designated Roth contributions. Www irs gov efile com Tax-sheltered annuity plan. Www irs gov efile com   A tax-sheltered annuity plan (often referred to as a 403(b) plan or a tax-deferred annuity plan) is a retirement plan for employees of public schools and certain tax-exempt organizations. Www irs gov efile com Generally, a tax-sheltered annuity plan provides retirement benefits by purchasing annuity contracts for its participants. Www irs gov efile com Types of pensions and annuities. Www irs gov efile com   Pensions and annuities include the following types. Www irs gov efile com Fixed-period annuities. Www irs gov efile com   You receive definite amounts at regular intervals for a specified length of time. Www irs gov efile com Annuities for a single life. Www irs gov efile com   You receive definite amounts at regular intervals for life. Www irs gov efile com The payments end at death. Www irs gov efile com Joint and survivor annuities. Www irs gov efile com   The first annuitant receives a definite amount at regular intervals for life. Www irs gov efile com After he or she dies, a second annuitant receives a definite amount at regular intervals for life. Www irs gov efile com The amount paid to the second annuitant may or may not differ from the amount paid to the first annuitant. Www irs gov efile com Variable annuities. Www irs gov efile com   You receive payments that may vary in amount for a specified length of time or for life. Www irs gov efile com The amounts you receive may depend upon such variables as profits earned by the pension or annuity funds, cost-of-living indexes, or earnings from a mutual fund. Www irs gov efile com Disability pensions. Www irs gov efile com   You receive disability payments because you retired on disability and have not reached minimum retirement age. Www irs gov efile com More than one program. Www irs gov efile com   You may receive employee plan benefits from more than one program under a single trust or plan of your employer. Www irs gov efile com If you participate in more than one program, you may have to treat each as a separate pension or annuity contract, depending upon the facts in each case. Www irs gov efile com Also, you may be considered to have received more than one pension or annuity. Www irs gov efile com Your former employer or the plan administrator should be able to tell you if you have more than one contract. Www irs gov efile com Example. Www irs gov efile com Your employer set up a noncontributory profit-sharing plan for its employees. Www irs gov efile com The plan provides that the amount held in the account of each participant will be paid when that participant retires. Www irs gov efile com Your employer also set up a contributory defined benefit pension plan for its employees providing for the payment of a lifetime pension to each participant after retirement. Www irs gov efile com The amount of any distribution from the profit-sharing plan depends on the contributions (including allocated forfeitures) made for the participant and the earnings from those contributions. Www irs gov efile com Under the pension plan, however, a formula determines the amount of the pension benefits. Www irs gov efile com The amount of contributions is the amount necessary to provide that pension. Www irs gov efile com Each plan is a separate program and a separate contract. Www irs gov efile com If you get benefits from these plans, you must account for each separately, even though the benefits from both may be included in the same check. Www irs gov efile com Distributions from a designated Roth account are treated separately from other distributions from the plan. Www irs gov efile com Qualified domestic relations order (QDRO). Www irs gov efile com   A QDRO is a judgment, decree, or order relating to payment of child support, alimony, or marital property rights to a spouse, former spouse, child, or other dependent of a participant in a retirement plan. Www irs gov efile com The QDRO must contain certain specific information, such as the name and last known mailing address of the participant and each alternate payee, and the amount or percentage of the participant's benefits to be paid to each alternate payee. Www irs gov efile com A QDRO may not award an amount or form of benefit that is not available under the plan. Www irs gov efile com   A spouse or former spouse who receives part of the benefits from a retirement plan under a QDRO reports the payments received as if he or she were a plan participant. Www irs gov efile com The spouse or former spouse is allocated a share of the participant's cost (investment in the contract) equal to the cost times a fraction. Www irs gov efile com The numerator of the fraction is the present value of the benefits payable to the spouse or former spouse. Www irs gov efile com The denominator is the present value of all benefits payable to the participant. Www irs gov efile com   A distribution that is paid to a child or other dependent under a QDRO is taxed to the plan participant. Www irs gov efile com Variable Annuities The tax rules in this publication apply both to annuities that provide fixed payments and to annuities that provide payments that vary in amount based on investment results or other factors. Www irs gov efile com For example, they apply to commercial variable annuity contracts, whether bought by an employee retirement plan for its participants or bought directly from the issuer by an individual investor. Www irs gov efile com Under these contracts, the owner can generally allocate the purchase payments among several types of investment portfolios or mutual funds and the contract value is determined by the performance of those investments. Www irs gov efile com The earnings are not taxed until distributed either in a withdrawal or in annuity payments. Www irs gov efile com The taxable part of a distribution is treated as ordinary income. Www irs gov efile com Net investment income tax. Www irs gov efile com   Beginning in 2013, annuities under a nonqualified plan are included in calculating your net investment income for the net investment income tax (NIIT). Www irs gov efile com For information see the Instructions for Form 8960, Net Investment Income Tax — Individuals, Estates and Trusts. Www irs gov efile com For information on the tax treatment of a transfer or exchange of a variable annuity contract, see Transfers of Annuity Contracts under Taxation of Nonperiodic Payments, later. Www irs gov efile com Withdrawals. Www irs gov efile com   If you withdraw funds before your annuity starting date and your annuity is under a qualified retirement plan, a ratable part of the amount withdrawn is tax free. Www irs gov efile com The tax-free part is based on the ratio of your cost (investment in the contract) to your account balance under the plan. Www irs gov efile com   If your annuity is under a nonqualified plan (including a contract you bought directly from the issuer), the amount withdrawn is allocated first to earnings (the taxable part) and then to your cost (the tax-free part). Www irs gov efile com However, if you bought your annuity contract before August 14, 1982, a different allocation applies to the investment before that date and the earnings on that investment. Www irs gov efile com To the extent the amount withdrawn does not exceed that investment and earnings, it is allocated first to your cost (the tax-free part) and then to earnings (the taxable part). Www irs gov efile com   If you withdraw funds (other than as an annuity) on or after your annuity starting date, the entire amount withdrawn is generally taxable. Www irs gov efile com   The amount you receive in a full surrender of your annuity contract at any time is tax free to the extent of any cost that you have not previously recovered tax free. Www irs gov efile com The rest is taxable. Www irs gov efile com   For more information on the tax treatment of withdrawals, see Taxation of Nonperiodic Payments , later. Www irs gov efile com If you withdraw funds from your annuity before you reach age 59½, also see Tax on Early Distributions under Special Additional Taxes, later. Www irs gov efile com Annuity payments. Www irs gov efile com   If you receive annuity payments under a variable annuity plan or contract, you recover your cost tax free under either the Simplified Method or the General Rule, as explained under Taxation of Periodic Payments , later. Www irs gov efile com For a variable annuity paid under a qualified plan, you generally must use the Simplified Method. Www irs gov efile com For a variable annuity paid under a nonqualified plan (including a contract you bought directly from the issuer), you must use a special computation under the General Rule. Www irs gov efile com For more information, see Variable annuities in Publication 939 under Computation Under the General Rule. Www irs gov efile com Death benefits. Www irs gov efile com    If you receive a single-sum distribution from a variable annuity contract because of the death of the owner or annuitant, the distribution is generally taxable only to the extent it is more than the unrecovered cost of the contract. Www irs gov efile com If you choose to receive an annuity, the payments are subject to tax as described above. Www irs gov efile com If the contract provides a joint and survivor annuity and the primary annuitant had received annuity payments before death, you figure the tax-free part of annuity payments you receive as the survivor in the same way the primary annuitant did. Www irs gov efile com See Survivors and Beneficiaries , later. Www irs gov efile com Section 457 Deferred Compensation Plans If you work for a state or local government or for a tax-exempt organization, you may be able to participate in a section 457 deferred compensation plan. Www irs gov efile com If your plan is an eligible plan, you are not taxed currently on pay that is deferred under the plan or on any earnings from the plan's investment of the deferred pay. Www irs gov efile com You are generally taxed on amounts deferred in an eligible state or local government plan only when they are distributed from the plan. Www irs gov efile com You are taxed on amounts deferred in an eligible tax-exempt organization plan when they are distributed or otherwise made available to you. Www irs gov efile com Your 457(b) plan may have a designated Roth account option. Www irs gov efile com If so, you may be able to roll over amounts to the designated Roth account or make contributions. Www irs gov efile com Elective deferrals to a designated Roth account are included in your income. Www irs gov efile com Qualified distributions (explained later) are not included in your income. Www irs gov efile com See the Designated Roth accounts discussion under Taxation of Periodic Payments, later. Www irs gov efile com This publication covers the tax treatment of benefits under eligible section 457 plans, but it does not cover the treatment of deferrals. Www irs gov efile com For information on deferrals under section 457 plans, see Retirement Plan Contributions under Employee Compensation in Publication 525. Www irs gov efile com Is your plan eligible?   To find out if your plan is an eligible plan, check with your employer. Www irs gov efile com Plans that are not eligible section 457 plans include the following: Bona fide vacation leave, sick leave, compensatory time, severance pay, disability pay, or death benefit plans. Www irs gov efile com Nonelective deferred compensation plans for nonemployees (independent contractors). Www irs gov efile com Deferred compensation plans maintained by churches. Www irs gov efile com Length of service award plans for bona fide volunteer firefighters and emergency medical personnel. Www irs gov efile com An exception applies if the total amount paid to a volunteer exceeds $3,000 for any year of service. Www irs gov efile com Disability Pensions If you retired on disability, you generally must include in income any disability pension you receive under a plan that is paid for by your employer. Www irs gov efile com You must report your taxable disability payments as wages on line 7 of Form 1040 or Form 1040A or on line 8 of Form 1040NR until you reach minimum retirement age. Www irs gov efile com Minimum retirement age generally is the age at which you can first receive a pension or annuity if you are not disabled. Www irs gov efile com You may be entitled to a tax credit if you were permanently and totally disabled when you retired. Www irs gov efile com For information on this credit, see Publication 524. Www irs gov efile com Beginning on the day after you reach minimum retirement age, payments you receive are taxable as a pension or annuity. Www irs gov efile com Report the payments on Form 1040, lines 16a and 16b; Form 1040A, lines 12a and 12b; or on Form 1040NR, lines 17a and 17b. Www irs gov efile com Disability payments for injuries incurred as a direct result of a terrorist attack directed against the United States (or its allies) are not included in income. Www irs gov efile com For more information about payments to survivors of terrorist attacks, see Publication 3920, Tax Relief for Victims of Terrorist Attacks. Www irs gov efile com Insurance Premiums for Retired Public Safety Officers If you are an eligible retired public safety officer (law enforcement officer, firefighter, chaplain, or member of a rescue squad or ambulance crew), you can elect to exclude from income distributions made from your eligible retirement plan that are used to pay the premiums for accident or health insurance or long-term care insurance. Www irs gov efile com The premiums can be for coverage for you, your spouse, or dependents. Www irs gov efile com The distribution must be made directly from the plan to the insurance provider. Www irs gov efile com You can exclude from income the smaller of the amount of the insurance premiums or $3,000. Www irs gov efile com You can only make this election for amounts that would otherwise be included in your income. Www irs gov efile com The amount excluded from your income cannot be used to claim a medical expense deduction. Www irs gov efile com An eligible retirement plan is a governmental plan that is: a qualified trust, a section 403(a) plan, a section 403(b) annuity, or a section 457(b) plan. Www irs gov efile com If you make this election, reduce the otherwise taxable amount of your pension or annuity by the amount excluded. Www irs gov efile com The amount shown in box 2a of Form 1099-R does not reflect this exclusion. Www irs gov efile com Report your total distributions on Form 1040, line 16a; Form 1040A, line 12a; or Form 1040NR, line 17a. Www irs gov efile com Report the taxable amount on Form 1040, line 16b; Form 1040A, line 12b; or Form 1040NR, line 17b. Www irs gov efile com Enter “PSO” next to the appropriate line on which you report the taxable amount. Www irs gov efile com If you are retired on disability and reporting your disability pension on line 7 of Form 1040 or Form 1040A, or line 8 of Form 1040NR, include only the taxable amount on that line and enter “PSO” and the amount excluded on the dotted line next to the applicable line. Www irs gov efile com Railroad Retirement Benefits Benefits paid under the Railroad Retirement Act fall into two categories. Www irs gov efile com These categories are treated differently for income tax purposes. Www irs gov efile com The first category is the amount of tier 1 railroad retirement benefits that equals the social security benefit that a railroad employee or beneficiary would have been entitled to receive under the social security system. Www irs gov efile com This part of the tier 1 benefit is the social security equivalent benefit (SSEB) and you treat it for tax purposes like social security benefits. Www irs gov efile com If you received, repaid, or had tax withheld from the SSEB portion of tier 1 benefits during 2013, you will receive Form RRB-1099, Payments by the Railroad Retirement Board (or Form RRB-1042S, Statement for Nonresident Alien Recipients of Payments by the Railroad Retirement Board, if you are a nonresident alien) from the U. Www irs gov efile com S. Www irs gov efile com Railroad Retirement Board (RRB). Www irs gov efile com For more information about the tax treatment of the SSEB portion of tier 1 benefits and Forms RRB-1099 and RRB-1042S, see Publication 915. Www irs gov efile com The second category contains the rest of the tier 1 railroad retirement benefits, called the non-social security equivalent benefit (NSSEB). Www irs gov efile com It also contains any tier 2 benefit, vested dual benefit (VDB), and supplemental annuity benefit. Www irs gov efile com Treat this category of benefits, shown on Form RRB-1099-R, as an amount received from a qualified employee plan. Www irs gov efile com This allows for the tax-free (nontaxable) recovery of employee contributions from the tier 2 benefits and the NSSEB part of the tier 1 benefits. Www irs gov efile com (The NSSEB and tier 2 benefits, less certain repayments, are combined into one amount called the Contributory Amount Paid on Form RRB-1099-R. Www irs gov efile com ) Vested dual benefits and supplemental annuity benefits are non-contributory pensions and are fully taxable. Www irs gov efile com See Taxation of Periodic Payments , later, for information on how to report your benefits and how to recover the employee contributions tax free. Www irs gov efile com Form RRB-1099-R is used for U. Www irs gov efile com S. Www irs gov efile com citizens, resident aliens, and nonresident aliens. Www irs gov efile com Nonresident aliens. Www irs gov efile com   A nonresident alien is an individual who is not a citizen or a resident alien of the United States. Www irs gov efile com Nonresident aliens are subject to mandatory U. Www irs gov efile com S. Www irs gov efile com tax withholding unless exempt under a tax treaty between the United States and their country of legal residency. Www irs gov efile com A tax treaty exemption may reduce or eliminate tax withholding from railroad retirement benefits. Www irs gov efile com See Tax withholding next for more information. Www irs gov efile com   If you are a nonresident alien and your tax withholding rate changed or your country of legal residence changed during the year, you may receive more than one Form RRB-1042S or Form RRB-1099-R. Www irs gov efile com To determine your total benefits paid or repaid and total tax withheld for the year, you should add the amounts shown on all forms you received for that year. Www irs gov efile com For information on filing requirements for aliens, see Publication 519, U. Www irs gov efile com S. Www irs gov efile com Tax Guide for Aliens. Www irs gov efile com For information on tax treaties between the United States and other countries that may reduce or eliminate U. Www irs gov efile com S. Www irs gov efile com tax on your benefits, see Publication 901, U. Www irs gov efile com S. Www irs gov efile com Tax Treaties. Www irs gov efile com Tax withholding. Www irs gov efile com   To request or change your income tax withholding from SSEB payments, U. Www irs gov efile com S. Www irs gov efile com citizens should contact the IRS for Form W-4V, Voluntary Withholding Request, and file it with the RRB. Www irs gov efile com To elect, revoke, or change your income tax withholding from NSSEB, tier 2, VDB, and supplemental annuity payments received, use Form RRB W-4P, Withholding Certificate for Railroad Retirement Payments. Www irs gov efile com If you are a nonresident alien or a U. Www irs gov efile com S. Www irs gov efile com citizen living abroad, you should provide Form RRB-1001, Nonresident Questionnaire, to the RRB to furnish citizenship and residency information and to claim any treaty exemption from U. Www irs gov efile com S. Www irs gov efile com tax withholding. Www irs gov efile com Nonresident U. Www irs gov efile com S. Www irs gov efile com citizens cannot elect to be exempt from withholding on payments delivered outside of the U. Www irs gov efile com S. Www irs gov efile com Help from the RRB. Www irs gov efile com   To request an RRB form or to get help with questions about an RRB benefit, you should contact your nearest RRB field office if you reside in the United States (call 1-877-772-5772 for the nearest field office) or U. Www irs gov efile com S. Www irs gov efile com consulate/Embassy if you reside outside the United States. Www irs gov efile com You can visit the RRB on the Internet at www. Www irs gov efile com rrb. Www irs gov efile com gov. Www irs gov efile com Form RRB-1099-R. Www irs gov efile com   The following discussion explains the items shown on Form RRB-1099-R. Www irs gov efile com The amounts shown on this form are before any deduction for: Federal income tax withholding, Medicare premiums, Legal process garnishment payments, Recovery of a prior year overpayment of an NSSEB, tier 2 benefit, VDB, or supplemental annuity benefit, or Recovery of Railroad Unemployment Insurance Act benefits received while awaiting payment of your railroad retirement annuity. Www irs gov efile com   The amounts shown on this form are after any offset for: Social Security benefits, Age reduction, Public Service pensions or public disability benefits, Dual railroad retirement entitlement under another RRB claim number, Work deductions, Legal process partition deductions, Actuarial adjustment, Annuity waiver, or Recovery of a current-year overpayment of NSSEB, tier 2, VDB, or supplemental annuity benefits. Www irs gov efile com   The amounts shown on Form RRB-1099-R do not reflect any special rules, such as capital gain treatment or the special 10-year tax option for lump-sum payments, or tax-free rollovers. Www irs gov efile com To determine if any of these rules apply to your benefits, see the discussions about them later. Www irs gov efile com   Generally, amounts shown on your Form RRB-1099-R are considered a normal distribution. Www irs gov efile com Use distribution code “7” if you are asked for a distribution code. Www irs gov efile com Distribution codes are not shown on Form RRB-1099-R. Www irs gov efile com   There are three copies of this form. Www irs gov efile com Copy B is to be included with your income tax return if federal income tax is withheld. Www irs gov efile com Copy C is for your own records. Www irs gov efile com Copy 2 is filed with your state, city, or local income tax return, when required. Www irs gov efile com See the illustrated Copy B (Form RRB-1099-R) above. Www irs gov efile com       Each beneficiary will receive his or her own Form RRB-1099-R. Www irs gov efile com If you receive benefits on more than one railroad retirement record, you may get more than one Form RRB-1099-R. Www irs gov efile com So that you get your form timely, make sure the RRB always has your current mailing address. Www irs gov efile com Please click here for the text description of the image. Www irs gov efile com Form RRB-1099-R Box 1—Claim Number and Payee Code. Www irs gov efile com   Your claim number is a six- or nine-digit number preceded by an alphabetical prefix. Www irs gov efile com This is the number under which the RRB paid your benefits. Www irs gov efile com Your payee code follows your claim number and is the last number in this box. Www irs gov efile com It is used by the RRB to identify you under your claim number. Www irs gov efile com In all your correspondence with the RRB, be sure to use the claim number and payee code shown in this box. Www irs gov efile com Box 2—Recipient's Identification Number. Www irs gov efile com   This is the recipient's U. Www irs gov efile com S. Www irs gov efile com taxpayer identification number. Www irs gov efile com It is the social security number (SSN), individual taxpayer identification number (ITIN), or employer identification number (EIN), if known, for the person or estate listed as the recipient. Www irs gov efile com If you are a resident or nonresident alien who must furnish a taxpayer identification number to the IRS and are not eligible to obtain an SSN, use Form W-7, Application for IRS Individual Taxpayer Identification Number, to apply for an ITIN. Www irs gov efile com The Instructions for Form W-7 explain how and when to apply. Www irs gov efile com Box 3—Employee Contributions. Www irs gov efile com   This is the amount of taxes withheld from the railroad employee's earnings that exceeds the amount of taxes that would have been withheld had the earnings been covered under the social security system. Www irs gov efile com This amount is the employee's cost that you use to figure the tax-free part of the NSSEB and tier 2 benefit you received (the amount shown in box 4). Www irs gov efile com (For information on how to figure the tax-free part, see Partly Taxable Payments under Taxation of Periodic Payments, later. Www irs gov efile com ) The amount shown is the total employee contribution amount, not reduced by any amounts that the RRB calculated as previously recovered. Www irs gov efile com It is the latest amount reported for 2013 and may have increased or decreased from a previous Form RRB-1099-R. Www irs gov efile com If this amount has changed, the change is retroactive. Www irs gov efile com You may need to refigure the tax-free part of your NSSEB/tier 2 benefit for 2013 and prior tax years. Www irs gov efile com If this box is blank, it means that the amount of your NSSEB and tier 2 payments shown in box 4 is fully taxable. Www irs gov efile com    If you had a previous annuity entitlement that ended and you are figuring the tax-free part of your NSSEB/tier 2 benefit for your current annuity entitlement, you should contact the RRB for confirmation of your correct employee contribution amount. Www irs gov efile com Box 4—Contributory Amount Paid. Www irs gov efile com   This is the gross amount of the NSSEB and tier 2 benefit you received in 2013, less any 2013 benefits you repaid in 2013. Www irs gov efile com (Any benefits you repaid in 2013 for an earlier year or for an unknown year are shown in box 8. Www irs gov efile com ) This amount is the total contributory pension paid in 2013. Www irs gov efile com It may be partly taxable and partly tax free or fully taxable. Www irs gov efile com If you determine you are eligible to compute a tax-free part as explained later in Partly Taxable Payments under Taxation of Periodic Payments, use the latest reported employee contribution amount shown in box 3 as the cost. Www irs gov efile com Box 5—Vested Dual Benefit. Www irs gov efile com   This is the gross amount of vested dual benefit (VDB) payments paid in 2013, less any 2013 VDB payments you repaid in 2013. Www irs gov efile com It is fully taxable. Www irs gov efile com VDB payments you repaid in 2013 for an earlier year or for an unknown year are shown in box 8. Www irs gov efile com Note. Www irs gov efile com The amounts shown in boxes 4 and 5 may represent payments for 2013 and/or other years after 1983. Www irs gov efile com Box 6—Supplemental Annuity. Www irs gov efile com   This is the gross amount of supplemental annuity benefits paid in 2013, less any 2013 supplemental annuity benefits you repaid in 2013. Www irs gov efile com It is fully taxable. Www irs gov efile com Supplemental annuity benefits you repaid in 2013 for an earlier year or for an unknown year are shown in box 8. Www irs gov efile com Box 7—Total Gross Paid. Www irs gov efile com   This is the sum of boxes 4, 5, and 6. Www irs gov efile com The amount represents the total pension paid in 2013. Www irs gov efile com Include this amount on Form 1040, line 16a; Form 1040A, line 12a; or Form 1040NR, line 17a. Www irs gov efile com Box 8—Repayments. Www irs gov efile com   This amount represents any NSSEB, tier 2 benefit, VDB, and supplemental annuity benefit you repaid to the RRB in 2013 for years before 2013 or for unknown years. Www irs gov efile com The amount shown in this box has not been deducted from the amounts shown in boxes 4, 5, and 6. Www irs gov efile com It only includes repayments of benefits that were taxable to you. Www irs gov efile com This means it only includes repayments in 2013 of NSSEB benefits paid after 1985, tier 2 and VDB benefits paid after 1983, and supplemental annuity benefits paid in any year. Www irs gov efile com If you included the benefits in your income in the year you received them, you may be able to deduct the repaid amount. Www irs gov efile com For more information about repayments, see Repayment of benefits received in an earlier year , later. Www irs gov efile com    You may have repaid an overpayment of benefits by returning a payment, by making a payment, or by having an amount withheld from your railroad retirement annuity payment. Www irs gov efile com Box 9—Federal Income Tax Withheld. Www irs gov efile com   This is the total federal income tax withheld from your NSSEB, tier 2 benefit, VDB, and supplemental annuity benefit. Www irs gov efile com Include this on your income tax return as tax withheld. Www irs gov efile com If you are a nonresident alien and your tax withholding rate and/or country of legal residence changed during 2013, you will receive more than one Form RRB-1099-R for 2013. Www irs gov efile com Determine the total amount of U. Www irs gov efile com S. Www irs gov efile com federal income tax withheld from your 2013 RRB NSSEB, tier 2, VDB, and supplemental annuity payments by adding the amounts in box 9 of all original 2013 Forms RRB-1099-R, or the latest corrected or duplicate Forms RRB-1099-R you receive. Www irs gov efile com Box 10—Rate of Tax. Www irs gov efile com   If you are taxed as a U. Www irs gov efile com S. Www irs gov efile com citizen or resident alien, this box does not apply to you. Www irs gov efile com If you are a nonresident alien, an entry in this box indicates the rate at which tax was withheld on the NSSEB, tier 2, VDB, and supplemental annuity payments that were paid to you in 2013. Www irs gov efile com If you are a nonresident alien whose tax was withheld at more than one rate during 2013, you will receive a separate Form RRB-1099-R for each rate change during 2013. Www irs gov efile com Box 11—Country. Www irs gov efile com   If you are taxed as a U. Www irs gov efile com S. Www irs gov efile com citizen or resident alien, this box does not apply to you. Www irs gov efile com If you are a nonresident alien, an entry in this box indicates the country of which you were a resident for tax purposes at the time you received railroad retirement payments in 2013. Www irs gov efile com If you are a nonresident alien who was a resident of more than one country during 2013, you will receive a separate Form RRB-1099-R for each country of residence during 2013. Www irs gov efile com Box 12—Medicare Premium Total. Www irs gov efile com   This is for information purposes only. Www irs gov efile com The amount shown in this box represents the total amount of Part B Medicare premiums deducted from your railroad retirement annuity payments in 2013. Www irs gov efile com Medicare premium refunds are not included in the Medicare total. Www irs gov efile com The Medicare total is normally shown on Form RRB-1099 (if you are a citizen or resident alien of the United States) or Form RRB-1042S (if you are a nonresident alien). Www irs gov efile com However, if Form RRB-1099 or Form RRB-1042S is not required for 2013, then this total will be shown on Form RRB-1099-R. Www irs gov efile com If your Medicare premiums were deducted from your social security benefits, paid by a third party, refunded to you, and/or you paid the premiums by direct billing, your Medicare total will not be shown in this box. Www irs gov efile com Repayment of benefits received in an earlier year. Www irs gov efile com   If you had to repay any railroad retirement benefits that you had included in your income in an earlier year because at that time you thought you had an unrestricted right to it, you can deduct the amount you repaid in the year in which you repaid it. Www irs gov efile com   If you repaid $3,000 or less in 2013, deduct it on Schedule A (Form 1040), line 23. Www irs gov efile com The 2%-of-adjusted-gross-income limit applies to this deduction. Www irs gov efile com You cannot take this deduction if you file Form 1040A. Www irs gov efile com    If you repaid more than $3,000 in 2013, you can either take a deduction for the amount repaid on Schedule A (Form 1040), line 28 or you can take a credit against your tax. Www irs gov efile com For more information, see Repayments in Publication 525. Www irs gov efile com Withholding Tax and Estimated Tax Your retirement plan distributions are subject to federal income tax withholding. Www irs gov efile com However, you can choose not to have tax withheld on payments you receive unless they are eligible rollover distributions. Www irs gov efile com (These are distributions, described later under Rollovers, that are eligible for rollover treatment but are not paid directly to another qualified retirement plan or to a traditional IRA. Www irs gov efile com ) If you choose not to have tax withheld or if you do not have enough tax withheld, you may have to make estimated tax payments. Www irs gov efile com See Estimated tax , later. Www irs gov efile com The withholding rules apply to the taxable part of payments you receive from: An employer pension, annuity, profit-sharing, or stock bonus plan, Any other deferred compensation plan, A traditional individual retirement arrangement (IRA), or A commercial annuity. Www irs gov efile com For this purpose, a commercial annuity means an annuity, endowment, or life insurance contract issued by an insurance company. Www irs gov efile com There will be no withholding on any part of a distribution where it is reasonable to believe that it will not be includible in gross income. Www irs gov efile com Choosing no withholding. Www irs gov efile com   You can choose not to have income tax withheld from retirement plan payments unless they are eligible rollover distributions. Www irs gov efile com You can make this choice on Form W-4P for periodic and nonperiodic payments. Www irs gov efile com This choice generally remains in effect until you revoke it. Www irs gov efile com   The payer will ignore your choice not to have tax withheld if: You do not give the payer your social security number (in the required manner), or The IRS notifies the payer, before the payment is made, that you gave an incorrect social security number. Www irs gov efile com   To choose not to have tax withheld, a U. Www irs gov efile com S. Www irs gov efile com citizen or resident alien must give the payer a home address in the United States or its possessions. Www irs gov efile com Without that address, the payer must withhold tax. Www irs gov efile com For example, the payer has to withhold tax if the recipient has provided a U. Www irs gov efile com S. Www irs gov efile com address for a nominee, trustee, or agent to whom the benefits are delivered, but has not provided his or her own U. Www irs gov efile com S. Www irs gov efile com home address. Www irs gov efile com   If you do not give the payer a home address in the United States or its possessions, you can choose not to have tax withheld only if you certify to the payer that you are not a U. Www irs gov efile com S. Www irs gov efile com citizen, a U. Www irs gov efile com S. Www irs gov efile com resident alien, or someone who left the country to avoid tax. Www irs gov efile com But if you so certify, you may be subject to the 30% flat rate withholding that applies to nonresident aliens. Www irs gov efile com This 30% rate will not apply if you are exempt or subject to a reduced rate by treaty. Www irs gov efile com For details, get Publication 519. Www irs gov efile com Periodic payments. Www irs gov efile com   Unless you choose no withholding, your annuity or similar periodic payments (other than eligible rollover distributions) will be treated like wages for withholding purposes. Www irs gov efile com Periodic payments are amounts paid at regular intervals (such as weekly, monthly, or yearly) for a period of time greater than one year (such as for 15 years or for life). Www irs gov efile com You should give the payer a completed withholding certificate (Form W-4P or a similar form provided by the payer). Www irs gov efile com If you do not, tax will be withheld as if you were married and claiming three withholding allowances. Www irs gov efile com   Tax will be withheld as if you were single and were claiming no withholding allowances if: You do not give the payer your social security number (in the required manner), or The IRS notifies the payer (before any payment is made) that you gave an incorrect social security number. Www irs gov efile com   You must file a new withholding certificate to change the amount of withholding. Www irs gov efile com Nonperiodic distributions. Www irs gov efile com    Unless you choose no withholding, the withholding rate for a nonperiodic distribution (a payment other than a periodic payment) that is not an eligible rollover distribution is 10% of the distribution. Www irs gov efile com You can also ask the payer to withhold an additional amount using Form W-4P. Www irs gov efile com The part of any loan treated as a distribution (except an offset amount to repay the loan), explained later, is subject to withholding under this rule. Www irs gov efile com Eligible rollover distribution. Www irs gov efile com    If you receive an eligible rollover distribution, 20% of it generally will be withheld for income tax. Www irs gov efile com You cannot choose not to have tax withheld from an eligible rollover distribution. Www irs gov efile com However, tax will not be withheld if you have the plan administrator pay the eligible rollover distribution directly to another qualified plan or an IRA in a direct rollover. Www irs gov efile com For more information about eligible rollover distributions, see Rollovers , later. Www irs gov efile com Estimated tax. Www irs gov efile com   Your estimated tax is the total of your expected income tax, self-employment tax, and certain other taxes for the year, minus your expected credits and withheld tax. Www irs gov efile com Generally, you must make estimated tax payments for 2014 if you expect to owe at least $1,000 in tax (after subtracting your withholding and credits) and you expect your withholding and credits to be less than the smaller of: 90% of the tax to be shown on your 2014 return, or 100% of the tax shown on your 2013 return. Www irs gov efile com If your adjusted gross income for 2013 was more than $150,000 ($75,000 if your filing status for 2014 is married filing separately), substitute 110% for 100% in (2) above. Www irs gov efile com For more information, get Publication 505, Tax Withholding and Estimated Tax. Www irs gov efile com In figuring your withholding or estimated tax, remember that a part of your monthly social security or equivalent tier 1 railroad retirement benefits may be taxable. Www irs gov efile com See Publication 915. Www irs gov efile com You can choose to have income tax withheld from those benefits. Www irs gov efile com Use Form W-4V to make this choice. Www irs gov efile com Cost (Investment in the Contract) Distributions from your pension or annuity plan may include amounts treated as a recovery of your cost (investment in the contract). Www irs gov efile com If any part of a distribution is treated as a recovery of your cost under the rules explained in this publication, that part is tax free. Www irs gov efile com Therefore, the first step in figuring how much of a distribution is taxable is to determine the cost of your pension or annuity. Www irs gov efile com In general, your cost is your net investment in the contract as of the annuity starting date (or the date of the distribution, if earlier). Www irs gov efile com To find this amount, you must first figure the total premiums, contributions, or other amounts you paid. Www irs gov efile com This includes the amounts your employer contributed that were taxable to you when paid. Www irs gov efile com (However, see Foreign employment contributions , later. Www irs gov efile com ) It does not include amounts withheld from your pay on a tax-deferred basis (money that was taken out of your gross pay before taxes were deducted). Www irs gov efile com It also does not include amounts you contributed for health and accident benefits (including any additional premiums paid for double indemnity or disability benefits). Www irs gov efile com From this total cost you must subtract the following amounts. Www irs gov efile com Any refunded premiums, rebates, dividends, or unrepaid loans that were not included in your income and that you received by the later of the annuity starting date or the date on which you received your first payment. Www irs gov efile com Any other tax-free amounts you received under the contract or plan by the later of the dates in (1). Www irs gov efile com If you must use the Simplified Method for your annuity payments, the tax-free part of any single-sum payment received in connection with the start of the annuity payments, regardless of when you received it. Www irs gov efile com (See Simplified Method , later, for information on its required use. Www irs gov efile com ) If you use the General Rule for your annuity payments, the value of the refund feature in your annuity contract. Www irs gov efile com (See General Rule , later, for information on its use. Www irs gov efile com ) Your annuity contract has a refund feature if the annuity payments are for your life (or the lives of you and your survivor) and payments in the nature of a refund of the annuity's cost will be made to your beneficiary or estate if all annuitants die before a stated amount or a stated number of payments are made. Www irs gov efile com For more information, see Publication 939. Www irs gov efile com The tax treatment of the items described in (1) through (3) is discussed later under Taxation of Nonperiodic Payments . Www irs gov efile com Form 1099-R. Www irs gov efile com If you began receiving periodic payments of a life annuity in 2013, the payer should show your total contributions to the plan in box 9b of your 2013 Form 1099-R. Www irs gov efile com Annuity starting date defined. Www irs gov efile com   Your annuity starting date is the later of the first day of the first period for which you received a payment or the date the plan's obligations became fixed. Www irs gov efile com Example. Www irs gov efile com On January 1, you completed all your payments required under an annuity contract providing for monthly payments starting on August 1 for the period beginning July 1. Www irs gov efile com The annuity starting date is July 1. Www irs gov efile com This is the date you use in figuring the cost of the contract and selecting the appropriate number from Table 1 for line 3 of the Simplified Method Worksheet. Www irs gov efile com Designated Roth accounts. Www irs gov efile com   Your cost in these accounts is your designated Roth contributions that were included in your income as wages subject to applicable withholding requirements. Www irs gov efile com Your cost will also include any in-plan Roth rollovers you included in income. Www irs gov efile com Foreign employment contributions. Www irs gov efile com   If you worked abroad, your cost may include contributions by your employer to the retirement plan, but only if those contributions would be excludible from your gross income had they been paid directly to you as compensation. Www irs gov efile com The contributions that apply are: Contributions before 1963 by your employer, Contributions after 1962 by your employer if the contributions would be excludible from your gross income (not including the foreign earned income exclusion) had they been paid directly to you, or Contributions after 1996 by your employer if you performed the services of a foreign missionary (a duly ordained, commissioned, or licensed minister of a church or a lay person) but only if the contributions would be excludible from your gross income had they been paid directly to you. Www irs gov efile com Foreign employment contributions while a nonresident alien. Www irs gov efile com   In determining your cost, special rules apply if you are a U. Www irs gov efile com S. Www irs gov efile com citizen or resident alien who received distributions in 2013 from a plan to which contributions were made while you were a nonresident alien. Www irs gov efile com Your contributions and your employer's contributions are not included in your cost if the contribution: Was made based on compensation which was for services performed outside the United States while you were a nonresident alien, and Was not subject to income tax under the laws of the United States or any foreign country, but only if the contribution would have been subject to income tax if paid as cash compensation when the services were performed. Www irs gov efile com Taxation of Periodic Payments This section explains how the periodic payments you receive from a pension or annuity plan are taxed. Www irs gov efile com Periodic payments are amounts paid at regular intervals (such as weekly, monthly, or yearly) for a period of time greater than one year (such as for 15 years or for life). Www irs gov efile com These payments are also known as amounts received as an annuity. Www irs gov efile com If you receive an amount from your plan that is not a periodic payment, see Taxation of Nonperiodic Payments , later. Www irs gov efile com In general, you can recover the cost of your pension or annuity tax free over the period you are to receive the payments. Www irs gov efile com The amount of each payment that is more than the part that represents your cost is taxable (however, see Insurance Premiums for Retired Public Safety Officers , earlier). Www irs gov efile com Designated Roth accounts. Www irs gov efile com   If you receive a qualified distribution from a designated Roth account, the distribution is not included in your gross income. Www irs gov efile com This applies to both your cost in the account and income earned on that account. Www irs gov efile com A qualified distribution is generally a distribution that is: Made after a 5-tax-year period of participation, and Made on or after the date you reach age 59½, made to a beneficiary or your estate on or after your death, or attributable to your being disabled. Www irs gov efile com   If the distribution is not a qualified distribution, the rules discussed in this section apply. Www irs gov efile com The designated Roth account is treated as a separate contract. Www irs gov efile com Period of participation. Www irs gov efile com   The 5-tax-year period of participation is the 5-tax-year period beginning with the first tax year for which the participant made a designated Roth contribution to the plan. Www irs gov efile com Therefore, for designated Roth contributions made for 2013, the first year for which a qualified distribution can be made is 2018. Www irs gov efile com   However, if a direct rollover is made to the plan from a designated Roth account under another plan, the 5-tax-year period for the recipient plan begins with the first tax year for which the participant first had designated Roth contributions made to the other plan. Www irs gov efile com   Your 401(k), 403(b), or 457(b) plan may permit you to roll over amounts from those plans to a designated Roth account within the same plan. Www irs gov efile com This is known as an in-plan Roth rollover. Www irs gov efile com For more details, see In-plan Roth rollovers , later. Www irs gov efile com Fully Taxable Payments The pension or annuity payments that you receive are fully taxable if you have no cost in the contract because any of the following situations applies to you (however, see Insurance Premiums for Retired Public Safety Officers , earlier). Www irs gov efile com You did not pay anything or are not considered to have paid anything for your pension or annuity. Www irs gov efile com Amounts withheld from your pay on a tax-deferred basis are not considered part of the cost of the pension or annuity payment. Www irs gov efile com Your employer did not withhold contributions from your salary. Www irs gov efile com You got back all of your contributions tax free in prior years (however, see Exclusion not limited to cost under Partly Taxable Payments, later). Www irs gov efile com Report the total amount you got on Form 1040, line 16b; Form 1040A, line 12b; or on Form 1040NR, line 17b. Www irs gov efile com You should make no entry on Form 1040, line 16a; Form 1040A, line 12a; or Form 1040NR, line 17a. Www irs gov efile com Deductible voluntary employee contributions. Www irs gov efile com   Distributions you receive that are based on your accumulated deductible voluntary employee contributions are generally fully taxable in the year distributed to you. Www irs gov efile com Accumulated deductible voluntary employee contributions include net earnings on the contributions. Www irs gov efile com If distributed as part of a lump sum, they do not qualify for the 10-year tax option or capital gain treatment, explained later. Www irs gov efile com Partly Taxable Payments If you have a cost to recover from your pension or annuity plan (see Cost (Investment in the Contract) , earlier), you can exclude part of each annuity payment from income as a recovery of your cost. Www irs gov efile com This tax-free part of the payment is figured when your annuity starts and remains the same each year, even if the amount of the payment changes. Www irs gov efile com The rest of each payment is taxable (however, see Insurance Premiums for Retired Public Safety Officers , earlier). Www irs gov efile com You figure the tax-free part of the payment using one of the following methods. Www irs gov efile com Simplified Method. Www irs gov efile com You generally must use this method if your annuity is paid under a qualified plan (a qualified employee plan, a qualified employee annuity, or a tax-sheltered annuity plan or contract). Www irs gov efile com You cannot use this method if your annuity is paid under a nonqualified plan. Www irs gov efile com General Rule. Www irs gov efile com You must use this method if your annuity is paid under a nonqualified plan. Www irs gov efile com You generally cannot use this method if your annuity is paid under a qualified plan. Www irs gov efile com You determine which method to use when you first begin receiving your annuity, and you continue using it each year that you recover part of your cost. Www irs gov efile com If you had more than one partly taxable pension or annuity, figure the tax-free part and the taxable part of each separately. Www irs gov efile com Qualified plan annuity starting before November 19, 1996. Www irs gov efile com   If your annuity is paid under a qualified plan and your annuity starting date (defined earlier under Cost (Investment in the Contract) ) is after July 1, 1986, and before November 19, 1996, you could have chosen to use either the Simplified Method or the General Rule. Www irs gov efile com If your annuity starting date is before July 2, 1986, you use the General Rule unless your annuity qualified for the Three-Year Rule. Www irs gov efile com If you used the Three-Year Rule (which was repealed for annuities starting after July 1, 1986), your annuity payments are generally now fully taxable. Www irs gov efile com Exclusion limit. Www irs gov efile com   Your annuity starting date determines the total amount of annuity payments that you can exclude from income over the years. Www irs gov efile com Once your annuity starting date is determined, it does not change. Www irs gov efile com If you calculate the taxable portion of your annuity payments using the simplified method worksheet, the annuity starting date determines the recovery period for your cost. Www irs gov efile com That recovery period begins on your annuity starting date and is not affected by the date you first complete the worksheet. Www irs gov efile com Exclusion limited to cost. Www irs gov efile com   If your annuity starting date is after 1986, the total amount of annuity income that you can exclude over the years as a recovery of the cost cannot exceed your total cost. Www irs gov efile com Any unrecovered cost at your (or the last annuitant's) death is allowed as a miscellaneous itemized deduction on the final return of the decedent. Www irs gov efile com This deduction is not subject to the 2%-of-adjusted-gross-income limit. Www irs gov efile com Example 1. Www irs gov efile com Your annuity starting date is after 1986, and you exclude $100 a month ($1,200 a year) under the Simplified Method. Www irs gov efile com The total cost of your annuity is $12,000. Www irs gov efile com Your exclusion ends when you have recovered your cost tax free, that is, after 10 years (120 months). Www irs gov efile com After that, your annuity payments are generally fully taxable. Www irs gov efile com Example 2. Www irs gov efile com The facts are the same as in Example 1, except you die (with no surviving annuitant) after the eighth year of retirement. Www irs gov efile com You have recovered tax free only $9,600 (8 × $1,200) of your cost. Www irs gov efile com An itemized deduction for your unrecovered cost of $2,400 ($12,000 – $9,600) can be taken on your final return. Www irs gov efile com Exclusion not limited to cost. Www irs gov efile com   If your annuity starting date is before 1987, you can continue to take your monthly exclusion for as long as you receive your annuity. Www irs gov efile com If you chose a joint and survivor annuity, your survivor can continue to take the survivor's exclusion figured as of the annuity starting date. Www irs gov efile com The total exclusion may be more than your cost. Www irs gov efile com Simplified Method Under the Simplified Method, you figure the tax-free part of each annuity payment by dividing your cost by the total number of anticipated monthly payments. Www irs gov efile com For an annuity that is payable for the lives of the annuitants, this number is based on the annuitants' ages on the annuity starting date and is determined from a table. Www irs gov efile com For any other annuity, this number is the number of monthly annuity payments under the contract. Www irs gov efile com Who must use the Simplified Method. Www irs gov efile com   You must use the Simplified Method if your annuity starting date is after November 18, 1996, and you meet both of the following conditions. Www irs gov efile com You receive your pension or annuity payments from any of the following plans. Www irs gov efile com A qualified employee plan. Www irs gov efile com A qualified employee annuity. Www irs gov efile com A tax-sheltered annuity plan (403(b) plan). Www irs gov efile com On your annuity starting date, at least one of the following conditions applies to you. Www irs gov efile com You are under age 75. Www irs gov efile com You are entitled to less than 5 years of guaranteed payments. Www irs gov efile com Guaranteed payments. Www irs gov efile com   Your annuity contract provides guaranteed payments if a minimum number of payments or a minimum amount (for example, the amount of your investment) is payable even if you and any survivor annuitant do not live to receive the minimum. Www irs gov efile com If the minimum amount is less than the total amount of the payments you are to receive, barring death, during the first 5 years after payments begin (figured by ignoring any payment increases), you are entitled to less than 5 years of guaranteed payments. Www irs gov efile com Annuity starting before November 19, 1996. Www irs gov efile com   If your annuity starting date is after July 1, 1986, and before November 19, 1996, and you chose to use the Simplified Method, you must continue to use it each year that you recover part of your cost. Www irs gov efile com You could have chosen to use the Simplified Method if your annuity is payable for your life (or the lives of you and your survivor annuitant) and you met both of the conditions listed earlier under Who must use the Simplified Method . Www irs gov efile com Who cannot use the Simplified Method. Www irs gov efile com   You cannot use the Simplified Method if you receive your pension or annuity from a nonqualified plan or otherwise do not meet the conditions described in the preceding discussion. Www irs gov efile com See General Rule , later. Www irs gov efile com How to use the Simplified Method. Www irs gov efile com    Complete Worksheet A in the back of this publication to figure your taxable annuity for 2013. Www irs gov efile com Be sure to keep the completed worksheet; it will help you figure your taxable annuity next year. Www irs gov efile com   To complete line 3 of the worksheet, you must determine the total number of expected monthly payments for your annuity. Www irs gov efile com How you do this depends on whether the annuity is for a single life, multiple lives, or a fixed period. Www irs gov efile com For this purpose, treat an annuity that is payable over the life of an annuitant as payable for that annuitant's life even if the annuity has a fixed-period feature or also provides a temporary annuity payable to the annuitant's child under age 25. Www irs gov efile com    You do not need to complete line 3 of the worksheet or make the computation on line 4 if you received annuity payments last year and used last year's worksheet to figure your taxable annuity. Www irs gov efile com Instead, enter the amount from line 4 of last year's worksheet on line 4 of this year's worksheet. Www irs gov efile com Single-life annuity. Www irs gov efile com   If your annuity is payable for your life alone, use Table 1 at the bottom of the worksheet to determine the total number of expected monthly payments. Www irs gov efile com Enter on line 3 the number shown for your age on your annuity starting date. Www irs gov efile com This number will differ depending on whether your annuity starting date is before November 19, 1996, or after November 18, 1996. Www irs gov efile com Multiple-lives annuity. Www irs gov efile com   If your annuity is payable for the lives of more than one annuitant, use Table 2 at the bottom of the worksheet to determine the total number of expected monthly payments. Www irs gov efile com Enter on line 3 the number shown for the annuitants' combined ages on the annuity starting date. Www irs gov efile com For an annuity payable to you as the primary annuitant and to more than one survivor annuitant, combine your age and the age of the youngest survivor annuitant. Www irs gov efile com For an annuity that has no primary annuitant and is payable to you and others as survivor annuitants, combine the ages of the oldest and youngest annuitants. Www irs gov efile com Do not treat as a survivor annuitant anyone whose entitlement to payments depends on an event other than the primary annuitant's death. Www irs gov efile com   However, if your annuity starting date is before 1998, do not use Table 2 and do not combine the annuitants' ages. Www irs gov efile com Instead, you must use Table 1 at the bottom of the worksheet and enter on line 3 the number shown for the primary annuitant's age on the annuity starting date. Www irs gov efile com This number will differ depending on whether your annuity starting date is before November 19, 1996, or after November 18, 1996. Www irs gov efile com Fixed-period annuity. Www irs gov efile com   If your annuity does not depend in whole or in part on anyone's life expectancy, the total number of expected monthly payments to enter on line 3 of the worksheet is the number of monthly annuity payments under the contract. Www irs gov efile com Line 6. Www irs gov efile com   The amount on line 6 should include all amounts that could have been recovered in prior years. Www irs gov efile com If you did not recover an amount in a prior year, you may be able to amend your returns for the affected years. Www irs gov efile com Example. Www irs gov efile com Bill Smith, age 65, began receiving retirement benefits in 2013 under a joint and survivor annuity. Www irs gov efile com Bill's annuity starting date is January 1, 2013. Www irs gov efile com The benefits are to be paid for the joint lives of Bill and his wife, Kathy, age 65. Www irs gov efile com Bill had contributed $31,000 to a qualified plan and had received no distributions before the annuity starting date. Www irs gov efile com Bill is to receive a retirement benefit of $1,200 a month, and Kathy is to receive a monthly survivor benefit of $600 upon Bill's death. Www irs gov efile com Bill must use the Simplified Method to figure his taxable annuity because his payments are from a qualified plan and he is under age 75. Www irs gov efile com Because his annuity is payable over the lives of more than one annuitant, he uses his and Kathy's combined ages and Table 2 at the bottom of Worksheet A in completing line 3 of the worksheet. Www irs gov efile com His completed worksheet is shown later. Www irs gov efile com Bill's tax-free monthly amount is $100 ($31,000 ÷ 310) as shown on line 4 of the worksheet. Www irs gov efile com Upon Bill's death, if Bill has not recovered the full $31,000 investment, Kathy will also exclude $100 from her $600 monthly payment. Www irs gov efile com The full amount of any annuity payments received after 310 payments are paid must be included in gross income. Www irs gov efile com If Bill and Kathy die before 310 payments are made, a miscellaneous itemized deduction will be allowed for the unrecovered cost on the final income tax return of the last to die. Www irs gov efile com This deduction is not subject to the 2%-of-adjusted-gross-income limit. Www irs gov efile com Worksheet A. Www irs gov efile com Simplified Method Worksheet for Bill Smith 1. Www irs gov efile com Enter the total pension or annuity payments received this year. Www irs gov efile com Also, add this amount to the total for Form 1040, line 16a; Form 1040A, line 12a; or Form 1040NR, line 17a 1. Www irs gov efile com $14,400 2. Www irs gov efile com Enter your cost in the plan (contract) at the annuity starting date plus any death benefit exclusion. Www irs gov efile com * See Cost (Investment in the Contract) , earlier 2. Www irs gov efile com 31,000   Note. Www irs gov efile com If your annuity starting date was before this year and you completed this worksheet last year, skip line 3 and enter the amount from line 4 of last year's worksheet on line 4 below (even if the amount of your pension or annuity has changed). Www irs gov efile com Otherwise, go to line 3. Www irs gov efile com     3. Www irs gov efile com Enter the appropriate number from Table 1 below. Www irs gov efile com But if your annuity starting date was after 1997 and the payments are for your life and that of your beneficiary, enter the appropriate number from Table 2 below 3. Www irs gov efile com 310 4. Www irs gov efile com Divide line 2 by the number on line 3 4. Www irs gov efile com 100 5. Www irs gov efile com Multiply line 4 by the number of months for which this year's payments were made. Www irs gov efile com If your annuity starting date was before 1987, enter this amount on line 8 below and skip lines 6, 7, 10, and 11. Www irs gov efile com Otherwise, go to line 6 5. Www irs gov efile com 1,200 6. Www irs gov efile com Enter any amount previously recovered tax free in years after 1986. Www irs gov efile com This is the amount shown on line 10 of your worksheet for last year 6. Www irs gov efile com -0- 7. Www irs gov efile com Subtract line 6 from line 2 7. Www irs gov efile com 31,000 8. Www irs gov efile com Enter the smaller of line 5 or line 7 8. Www irs gov efile com 1,200 9. Www irs gov efile com Taxable amount for year. Www irs gov efile com Subtract line 8 from line 1. Www irs gov efile com Enter the result, but not less than zero. Www irs gov efile com Also, add this amount to the total for Form 1040, line 16b; Form 1040A, line 12b; or Form 1040NR, line 17b. Www irs gov efile com Note: If your Form 1099-R shows a larger taxable amount, use the amount figured on this line instead. Www irs gov efile com If you are a retired public safety officer, see Insurance Premiums for Retired Public Safety Officers , earlier, before entering an amount on your tax return 9. Www irs gov efile com $13,200 10. Www irs gov efile com Was your annuity starting date before 1987? □ Yes. Www irs gov efile com STOP. Www irs gov efile com Do not complete the rest of this worksheet. Www irs gov efile com  ☑ No. Www irs gov efile com Add lines 6 and 8. Www irs gov efile com This is the amount you have recovered tax free through 2013. Www irs gov efile com You will need this number if you need to fill out this worksheet next year 10. Www irs gov efile com 1,200 11. Www irs gov efile com Balance of cost to be recovered. Www irs gov efile com Subtract line 10 from line 2. Www irs gov efile com If zero, you will not have to complete this worksheet next year. Www irs gov efile com The payments you receive next year will generally be fully taxable 11. Www irs gov efile com $29,800         * A death benefit exclusion (up to $5,000) applied to certain benefits received by employees who died before August 21, 1996. Www irs gov efile com           Table 1 for Line 3 Above       AND your annuity starting date was—     IF the age at annuity starting date was. Www irs gov efile com . Www irs gov efile com . Www irs gov efile com BEFORE November 19, 1996, enter on line 3. Www irs gov efile com . Www irs gov efile com . Www irs gov efile com AFTER November 18, 1996, enter on line 3. Www irs gov efile com . Www irs gov efile com . Www irs gov efile com     55 or under 300 360     56-60 260 310     61-65 240 260     66-70 170 210     71 or older 120 160     Table 2 for Line 3 Above     IF the combined ages at  annuity starting date were. Www irs gov efile com . Www irs gov efile com . Www irs gov efile com THEN enter on line 3. Www irs gov efile com . Www irs gov efile com . Www irs gov efile com     110 or under   410     111-120   360     121-130   310     131-140   260     141 or older   210   Multiple annuitants. Www irs gov efile com   If you and one or more other annuitants receive payments at the same time, you exclude from each annuity payment a pro rata share of the monthly tax-free amount. Www irs gov efile com Figure your share by taking the following steps. Www irs gov efile com Complete your worksheet through line 4 to figure the monthly tax-free amount. Www irs gov efile com Divide the amount of your monthly payment by the total amount of the monthly payments to all annuitants. Www irs gov efile com Multiply the amount on line 4 of your worksheet by the amount figured in (2) above. Www irs gov efile com The result is your share of the monthly tax-free amount. Www irs gov efile com   Replace the amount on line 4 of the worksheet with the result in (3) above. Www irs gov efile com Enter that amount on line 4 of your worksheet each year. Www irs gov efile com General Rule Under the General Rule, you determine the tax-free part of each annuity payment based on the ratio of the cost of the contract to the total expected return. Www irs gov efile com Expected return is the total amount you and other eligible annuitants can expect to receive under the contract. Www irs gov efile com To figure it, you must use life expectancy (actuarial) tables prescribed by the IRS. Www irs gov efile com Who must use the General Rule. Www irs gov efile com   You must use the General Rule if you receive pension or annuity payments from: A nonqualified plan (such as a private annuity, a purchased commercial annuity, or a nonqualified employee plan), or A qualified plan if you are age 75 or older on your annuity starting date and your annuity payments are guaranteed for at least 5 years. Www irs gov efile com Annuity starting before November 19, 1996. Www irs gov efile com   If your annuity starting date is after July 1, 1986, and before November 19, 1996, you had to use the General Rule for either circumstance just described. Www irs gov efile com You also had to use it for any fixed-period annuity. Www irs gov efile com If you did not have to use the General Rule, you could have chosen to use it. Www irs gov efile com If your annuity starting date is before July 2, 1986, you had to use the General Rule unless you could use the Three-Year Rule. Www irs gov efile com   If you had to use the General Rule (or chose to use it), you must continue to use it each year that you recover your cost. Www irs gov efile com Who cannot use the General Rule. Www irs gov efile com   You cannot use the General Rule if you receive your pension or annuity from a qualified plan and none of the circumstances described in the preceding discussions apply to you. Www irs gov efile com See Simplified Method , earlier. Www irs gov efile com More information. Www irs gov efile com   For complete information on using the General Rule, including the actuarial tables you need, see Publication 939. Www irs gov efile com Taxation of Nonperiodic Payments This section of the publication explains how any nonperiodic distributions you receive under a pension or annuity plan are taxed. Www irs gov efile com Nonperiodic distributions are also known as amounts not received as an annuity. Www irs gov efile com They include all payments other than periodic payments and corrective distributions. Www irs gov efile com For example, the following items are treated as nonperiodic distributions. Www irs gov efile com Cash withdrawals. Www irs gov efile com Distributions of current earnings (dividends) on your investment. Www irs gov efile com However, do not include these distributions in your income to the extent the insurer keeps them to pay premiums or other consideration for the contract. Www irs gov efile com Certain loans. Www irs gov efile com See Loans Treated as Distributions , later. Www irs gov efile com The value of annuity contracts transferred without full and adequate consideration. Www irs gov efile com See Transfers of Annuity Contracts , later. Www irs gov efile com Corrective distributions of excess plan contributions. Www irs gov efile com   Generally, if the contributions made for you during the year to certain retirement plans exceed certain limits, the excess is taxable to you. Www irs gov efile com To correct an excess, your plan may distribute it to you (along with any income earned on the excess). Www irs gov efile com Although the plan reports the corrective distributions on Form 1099-R, the distribution is not treated as a nonperiodic distribution from the plan. Www irs gov efile com It is not subject to the allocation rules explained in the following discussion, it cannot be rolled over into another plan, and it is not subject to the additional tax on early distributions. Www irs gov efile com    If your retirement plan made a corrective distribution of excess amounts (excess deferrals, excess contributions, or excess annual additions), your Form 1099-R should have the code “8,” “B,” “P,” or “E” in box 7. Www irs gov efile com   For information on plan contribution limits and how to report corrective distributions of excess contributions, see Retirement Plan Contributions under Employee Compensation in Publication 525. Www irs gov efile com Figuring the Taxable Amount How you figure the taxable amount of a nonperiodic distribution depends on whether it is made before the annuity starting date, or on or after the annuity starting date. Www irs gov efile com If it is made before the annuity starting date, its tax treatment also depends on whether it is made under a qualified or nonqualified plan. Www irs gov efile com If it is made under a nonqualified plan, its tax treatment depends on whether it fully discharges the contract, is received under certain life insurance or endowment contracts, or is allocable to an investment you made before August 14, 1982. Www irs gov efile com You may be able to roll over the taxable amount of a nonperiodic distribution from a qualified retirement plan into another qualified retirement plan or a traditional IRA tax free. Www irs gov efile com See Rollovers, later. Www irs gov efile com If you do not make a tax-free rollover and the distribution qualifies as a lump-sum distribution, you may be able to elect an optional method of figuring the tax on the taxable amount. Www irs gov efile com See Lump-Sum Distributions, later. Www irs gov efile com Annuity starting date. Www irs gov efile com   The annuity starting date is either the first day of the first period for which you receive an annuity payment under the contract or the date on which the obligation under the contract becomes fixed, whichever is later. Www irs gov efile com Distributions of employer securities. Www irs gov efile com    If you receive a distribution of employer securities from a qualified retirement plan, you may be able to defer the tax on the net unrealized appreciation (NUA) in the securities. Www irs gov efile com The NUA is the net increase in the securities' value while they were in the trust. Www irs gov efile com This tax deferral applies to distributions of the employer corporation's stocks, bonds, registered debentures, and debentures with interest coupons attached. Www irs gov efile com   If the distribution is a lump-sum distribution, tax is deferred on all of the NUA unless you choose to include it in your income for the year of the distribution. Www irs gov efile com    A lump-sum distribution for this purpose is the distribution or payment of a plan participant's entire balance (within a single tax year) from all of the employer's qualified plans of one kind (pension, profit-sharing, or stock bonus plans), but only if paid: Because of the plan participant's death, After the participant reaches age 59½, Because the participant, if an employee, separates from service, or After the participant, if a self-employed individual, becomes totally and permanently disabled. Www irs gov efile com    If you choose to include NUA in your income for the year of the distribution and the participant was born before January 2, 1936, you may be able to figure the tax on the NUA using the optional methods described und