Filing Your Taxes Online is Fast, Easy and Secure.
Start now and receive your tax refund in as little as 7 days.

1. Get Answers

Your online questions are customized to your unique tax situation.

2. Maximize your Refund

Find tax credits for everything from school tuition to buying a hybri

3. E-File for FREE

E-file free with direct deposit to get your refund in as few as 7 days.

Filing your taxes with paper mail can be difficult and it could take weeks for your refund to arrive. IRS e-file is easy, fast and secure. There is no paperwork going to the IRS so tax refunds can be processed in as little as 7 days with direct deposit. As you prepare your taxes online, you can see your tax refund in real time.

FREE audit support and representation from an enrolled agent – NEW and only from H&R Block

2014 State Tax Forms

Last Day To File Taxes 2014File State Income Tax Online Free1040ez Instructions 2014File Amended ReturnFile 2009 Tax Return TurbotaxState Income Tax ChartH R Block 2011Amended Tax Returns More:label_amended_20tax_20returns More:taxesEfile 1040nr Ez 540nr ShortFree Taxes H&r Block1040x TurbotaxE File 2011 Taxes OnlineIrs Forms Amended Return1040ez Forms And InstructionsHow To Amend Income Tax ReturnI Need Tax Instruction Booklet For 1040ezHow Do I Complete A 1040x Forms140 Ez FormIrs Form 1040a Or 1040ezLast Day File Taxes 2013I Need To File My 2011 Federal TaxesTaxes For Self EmployedStudent Tax FormsFree State Tax Filing OnlineCan I File My 1040x OnlineWhat Form Do I Need To Amend My TaxesState Tax ReturnHttps Efile State Tax FreeStudents TaxesWwwh&rblock ComH&r Block Free EfileHow To Complete 1040x2010 Tax FilingFreetaxusa20111040nr TurbotaxCan I Still File My 2011 State TaxesHow To Fill 1040nrFiling An AmendmentH & R Block Online FilingTurbotax Deluxe Federal E File State 2012

2014 State Tax Forms

2014 state tax forms 2. 2014 state tax forms   Fuel Tax Credits and Refunds Table of Contents Gasoline and Aviation Gasoline Undyed Diesel Fuel and Undyed Kerosene (Other Than Kerosene Used in Aviation)Sales by Registered Ultimate Vendors Diesel-Water Fuel Emulsion Kerosene for Use in AviationSales by Registered Ultimate Vendors Other Fuels (Including Alternative Fuels) Refunds of Second TaxOptional reporting. 2014 state tax forms Providing information. 2014 state tax forms Definitions of Nontaxable UsesCustom application of fertilizer and pesticide. 2014 state tax forms Fuel used between airfield and farm. 2014 state tax forms Fuel not used for farming. 2014 state tax forms Vehicles not considered highway vehicles. 2014 state tax forms Biodiesel or Renewable Diesel Mixture Credit, Alternative Fuel Credit, and Alternative Fuel Mixture CreditHow to Claim the Credit Filing Claims Claiming A Refund Claiming a Credit on Form 4136 Including the Credit or Refund in Income Federal excise taxes are imposed on certain fuels as discussed in chapter 1. 2014 state tax forms This chapter lists the nontaxable uses of each fuel and defines the nontaxable uses. 2014 state tax forms Information on the refund of second tax is included. 2014 state tax forms This chapter also explains credits and refunds for the biodiesel or renewable diesel mixture credits, and the alternative fuel mixture and alternative fuel credits. 2014 state tax forms Information on how to make a claim for credit or refund is included in this chapter and in the instructions for: Form 720, Form 4136, and Form 8849. 2014 state tax forms Exported taxable fuel. 2014 state tax forms   The claim rates for exported taxable fuel are listed on Schedule C (Form 720), Schedule 1 (Form 8849), and Form 4136. 2014 state tax forms Taxpayers making a claim for exported taxable fuel must include with their records proof of exportation. 2014 state tax forms Proof of exportation includes: A copy of the export bill of lading issued by the delivering carrier, A certificate by the agent or representative of the export carrier showing actual exportation of the fuel, A certificate of lading signed by a customs officer of the foreign country to which the fuel is exported, or A statement of the foreign consignee showing receipt of the fuel. 2014 state tax forms Gasoline and Aviation Gasoline Ultimate Purchasers. 2014 state tax forms   The following are the uses of gasoline (defined earlier) for which a credit or refund may be allowable to an ultimate purchaser. 2014 state tax forms On a farm for farming purposes (credit only). 2014 state tax forms Off-highway business use. 2014 state tax forms Export. 2014 state tax forms In a boat engaged in commercial fishing. 2014 state tax forms In certain intercity and local buses. 2014 state tax forms In a school bus. 2014 state tax forms Exclusive use by a qualified blood collector organization. 2014 state tax forms In a highway vehicle owned by the United States that is not used on a highway. 2014 state tax forms Exclusive use by a nonprofit educational organization (see Sales by registered ultimate vendors and Credit Card Purchases, later). 2014 state tax forms Exclusive use by a state, political subdivision of a state, or the District of Columbia (see Sales by registered ultimate vendors and Credit Card Purchases, later). 2014 state tax forms In an aircraft or vehicle owned by an aircraft museum. 2014 state tax forms   The following are the uses of aviation gasoline for which a credit or refund may be allowable to an ultimate purchaser. 2014 state tax forms On a farm for farming purposes (credit only). 2014 state tax forms Export. 2014 state tax forms In foreign trade. 2014 state tax forms Certain helicopter and fixed-wing air ambulance uses. 2014 state tax forms In commercial aviation (other than foreign trade). 2014 state tax forms Exclusive use by a qualified blood collector organization. 2014 state tax forms Exclusive use by a nonprofit education organization (see Sales by registered ultimate vendors and Credit card purchases, later). 2014 state tax forms Exclusive use by a state, political subdivision of a state, or the District of Columbia (see Sales by registered ultimate vendors and Credit and purchases, later). 2014 state tax forms In an aircraft owned by an aircraft museum. 2014 state tax forms In military aircraft. 2014 state tax forms Claims by persons who paid the tax to the government. 2014 state tax forms   Except for sales to nonprofit educational organizations and states and local governments, a credit or refund is allowable to the person that paid the tax to the government if the gasoline was sold to the ultimate purchaser (including an exporter) by either that person or by a retailer and the fuel was exported; used or sold for use as supplies for vessels or aircraft, including military aircraft, commercial fishing, and foreign trade; sold to a qualified blood collector organization; or used or sold for use in the production of Other Fuels. 2014 state tax forms See Filing Claims, later. 2014 state tax forms Sales by registered ultimate vendors. 2014 state tax forms   This is an ultimate vendor that sells gasoline or aviation gasoline to any of the following and that is purchased without the use of a credit card. 2014 state tax forms A state or local government for its exclusive use (including essential government use by an Indian tribal government). 2014 state tax forms A nonprofit educational organization for its exclusive use. 2014 state tax forms   The registered ultimate vendor may make the claim if the ultimate purchaser did not use a credit card and waives its right to the credit or refund by providing the registered ultimate vendor with a certificate. 2014 state tax forms A sample certificate is included as Model Certificate M in the Appendix. 2014 state tax forms The registered ultimate vendor must have the certificate at the time the credit or refund is claimed. 2014 state tax forms   The ultimate vendor must be registered by the IRS. 2014 state tax forms See Registration Requirements, earlier. 2014 state tax forms Credit card purchases. 2014 state tax forms   If gasoline and aviation gasoline are purchased with a credit card issued to a state or local government for its exclusive use (including essential government use by an Indian tribal government), or a nonprofit educational organization for its exclusive use, the person who extended credit to the ultimate purchaser (the credit card issuer) is treated as the person that paid the tax and makes the claim if the credit card issuer: Is registered by the IRS, Has established that the amount of tax has not been collected from the person who purchased the gasoline or has obtained written consent from the ultimate purchaser to the allowance of the credit or refund, and Has repaid or agreed to repay the amount of the tax to the ultimate vendor, has obtained the written consent of the ultimate vendor to the allowance of the credit or refund, or has made arrangements that provide the ultimate vendor with reimbursement of the tax. 2014 state tax forms   If the requirements above are not met by the credit card issuer, the credit card issuer must collect the tax from the ultimate purchaser and only the ultimate purchaser may make the claim. 2014 state tax forms How to make the claim. 2014 state tax forms   If the claim is made by the credit card issuer, see Schedule C  (Form 720) or Schedule 8 (Form 8849). 2014 state tax forms Undyed Diesel Fuel and Undyed Kerosene (Other Than Kerosene Used in Aviation) For conditions to an allowance of a credit or refund on exported dyed diesel fuel and dyed kerosene, see Exported taxable fuel, earlier. 2014 state tax forms Ultimate purchasers. 2014 state tax forms   The following are nontaxable uses of diesel fuel and kerosene (defined earlier) for which a credit or refund may be allowable to an ultimate purchaser. 2014 state tax forms On a farm for farming purposes. 2014 state tax forms Off-highway business use. 2014 state tax forms Export. 2014 state tax forms In a qualified local bus. 2014 state tax forms In a school bus. 2014 state tax forms Other than as a fuel in a propulsion engine of a diesel-powered highway vehicle (such as home heating oil). 2014 state tax forms Exclusive use by a qualified blood collector organization. 2014 state tax forms In a highway vehicle owned by the United States that is not used on a highway. 2014 state tax forms Exclusive use by a nonprofit educational organization (see Sales by Registered Ultimate Vendors and Credit Card Purchases, later). 2014 state tax forms Exclusive use by a state, political subdivision of a state, or the District of Columbia (see Sales by Registered Ultimate Vendors and Credit Card Purchases, later). 2014 state tax forms In a vehicle owned by an aircraft museum. 2014 state tax forms As a fuel in a propulsion engine of a diesel-powered train. 2014 state tax forms Sales by Registered Ultimate Vendors The following are the sales for which a credit or refund may be allowable to the registered ultimate vendor only. 2014 state tax forms Undyed diesel fuel or undyed kerosene sold for the exclusive use by a state or local government (if credit card rules (defined later) do not apply), Undyed kerosene sold from a blocked pump (defined below), or Undyed diesel fuel or undyed kerosene used in certain intercity and local buses, only if the ultimate purchaser waives its right to the credit or refund by providing the registered ultimate vendor with a waiver. 2014 state tax forms Registered ultimate vendor (state use). 2014 state tax forms   This is a person that sells undyed diesel fuel or undyed kerosene to a state or local government for its exclusive use (including essential government use by an Indian tribal government). 2014 state tax forms The diesel fuel or kerosene must be purchased by the state without the use of a credit card, issued to the state by the credit card issuer, in order for the ultimate vendor to make the claim. 2014 state tax forms The ultimate vendor must be registered by the IRS. 2014 state tax forms See Registration Requirements, earlier. 2014 state tax forms Registered ultimate vendor (blocked pump). 2014 state tax forms   This is an ultimate vendor that sells undyed kerosene from a blocked pump. 2014 state tax forms   A credit or refund may be allowable to a registered ultimate vendor (blocked pump) if the vendor sold to a buyer undyed kerosene from a blocked pump for use other than as a fuel in a diesel-powered highway vehicle and the vendor had no reason to believe the kerosene would not be used in that manner. 2014 state tax forms Blocked pump. 2014 state tax forms   A blocked pump is a fuel pump that meets all the following requirements. 2014 state tax forms It is used to make retail sales of undyed kerosene for use by the buyer in any nontaxable use. 2014 state tax forms It is at a fixed location. 2014 state tax forms It is identified with a legible and conspicuous notice stating, “UNDYED UNTAXED KEROSENE, NONTAXABLE USE ONLY. 2014 state tax forms ” It meets either of the following conditions. 2014 state tax forms It cannot reasonably be used to dispense fuel directly into the fuel supply tank of a diesel-powered highway vehicle or train. 2014 state tax forms It is locked by the vendor after each sale and unlocked by the vendor only in response to a buyer's request for undyed kerosene for use other than as a fuel in a diesel-powered highway vehicle or train. 2014 state tax forms Registered ultimate vendor (certain intercity and local buses). 2014 state tax forms   This is an ultimate vendor that sells undyed diesel fuel or undyed kerosene to the ultimate purchaser for use in certain intercity and local buses. 2014 state tax forms   The registered ultimate vendor may make the claim if the ultimate purchaser waives its right to the credit or refund by providing the registered ultimate vendor with a waiver. 2014 state tax forms A sample waiver is included as Model Waiver N in the Appendix. 2014 state tax forms The registered ultimate vendor must have the waiver at the time the credit or payment is claimed. 2014 state tax forms Credit Card Purchases. 2014 state tax forms   If undyed diesel fuel or kerosene is purchased with a credit card issued to a state, the person who extended credit to the state (the credit card issuer) is treated as the person that paid the tax and makes the claim if the credit card issuer: Is registered by the IRS, Has established that the amount of tax has not been collected from the person who purchased the diesel fuel or kerosene, or has obtained written consent from the ultimate purchaser to the allowance of the credit or refund, and Has repaid or agreed to repay the amount of the tax to the ultimate vendor, has obtained the written consent of the ultimate vendor to the allowance of the credit or refund, or has made arrangements that provide the ultimate vendor with reimbursement of the tax. 2014 state tax forms   If the requirements above are not met by the credit card issuer, the credit card issuer must collect the tax from the ultimate purchaser and only the ultimate purchaser may make the claim. 2014 state tax forms Diesel-Water Fuel Emulsion A claim for credit or refund may be made for the nontaxable use of a diesel-water fuel emulsion and for undyed diesel fuel used to produce a diesel-water fuel emulsion. 2014 state tax forms The claim rate for nontaxable use of a diesel-water fuel emulsion taxed at $. 2014 state tax forms 198 per gallon is $. 2014 state tax forms 197 (if exported, the claim rate is $. 2014 state tax forms 198). 2014 state tax forms The following are the nontaxable uses for a diesel-water fuel emulsion for which a credit or refund may be allowable to an ultimate purchaser. 2014 state tax forms On a farm for farming purposes. 2014 state tax forms Off-highway business use. 2014 state tax forms Export. 2014 state tax forms In a qualified local bus. 2014 state tax forms In a school bus. 2014 state tax forms Other than as fuel in the propulsion engine of a train or diesel-powered highway vehicle (but not off-highway use). 2014 state tax forms Exclusive use by a qualified blood collector organization. 2014 state tax forms In a highway vehicle owned by the United States that is not used on a highway. 2014 state tax forms Exclusive use by a nonprofit educational organization. 2014 state tax forms Exclusive use by a state, political subdivision of a state, or the District of Columbia. 2014 state tax forms In an aircraft or vehicle owned by an aircraft museum. 2014 state tax forms Blender claims. 2014 state tax forms   The claim rate for undyed diesel fuel taxed at $. 2014 state tax forms 244 and used to produce a diesel-water fuel emulsion is $. 2014 state tax forms 046 per gallon of diesel fuel so used. 2014 state tax forms The blender must be registered by the IRS in order to make the claim. 2014 state tax forms The blender must attach a statement to the claim certifying that: The diesel-water fuel emulsion contains at least 14% water, The emulsion additive is registered by a United States manufacturer with the EPA under section 211 of the Clean Air Act as in effect on March 31, 2003, Undyed diesel fuel taxed at $. 2014 state tax forms 244 was used to produce the diesel-water fuel emulsion, and The diesel-water fuel emulsion was used or sold for use in the blender's trade or business. 2014 state tax forms Kerosene for Use in Aviation Ultimate purchasers. 2014 state tax forms   Ultimate purchasers of kerosene used in certain aviation uses may make a claim if the rate of tax on their use is less than the rate of tax that was charged on the kerosene. 2014 state tax forms   The ultimate purchaser of the kerosene used in commercial aviation (other than foreign trade) and noncommercial aviation (other than nonexempt, noncommercial aviation and exclusive use by a state, political subdivision of a state, or the District of Columbia) is eligible to make a claim if the ultimate purchaser certifies that the right to make the claim has not been waived. 2014 state tax forms Generally, the ultimate purchaser is the aircraft operator. 2014 state tax forms   The following are the nontaxable uses of kerosene used in noncommercial aviation for which a credit or refund may be allowable to the ultimate purchaser. 2014 state tax forms On a farm for farming purposes. 2014 state tax forms Certain helicopter and fixed-wing aircraft uses. 2014 state tax forms Exclusive use by a qualified blood collector organization. 2014 state tax forms Exclusive use by a nonprofit educational organization. 2014 state tax forms In an aircraft owned by an aircraft museum. 2014 state tax forms In military aircraft. 2014 state tax forms Kerosene for use partly in commercial aviation and partly in nonexempt, noncommercial aviation. 2014 state tax forms   If the fuel is used partly for use in commercial aviation and partly for use in nonexempt, noncommercial aviation, the operator may identify, either at the time of purchase or after the kerosene has been used, the amount that will be (or has been) used in commercial aviation. 2014 state tax forms At the same time, the operator would either make the claim or waive the right to make the claim for credit or refund of the kerosene for use in commercial and nonexempt, noncommercial aviation. 2014 state tax forms   If the operator does not identify the amount of kerosene that will be (or has been) used in commercial aviation, the operator may provide a certificate to the ultimate vendor similar to Model Certificate Q in the Appendix. 2014 state tax forms For kerosene purchased with the certificate, used in commercial aviation, and taxed at $. 2014 state tax forms 244 per gallon, use of the certificate will be treated as a waiver of the right to claim a credit or refund for the $. 2014 state tax forms 025 per gallon part of the tax. 2014 state tax forms The ultimate vendor may make this claim. 2014 state tax forms The operator may make a claim for the $. 2014 state tax forms 175 tax per gallon of the kerosene, but cannot waive the right to make the claim for the $. 2014 state tax forms 175 tax per gallon. 2014 state tax forms Sales by Registered Ultimate Vendors Kerosene for use in commercial aviation or noncommercial aviation. 2014 state tax forms   The registered ultimate vendor of kerosene for use in commercial aviation (other than foreign trade) or noncommercial aviation (other than nonexempt, noncommercial aviation and exclusive use by a state, political subdivision of a state, or the District of Columbia) may make this claim if the ultimate purchaser waives its right to the credit or payment by providing the registered ultimate vendor with a waiver. 2014 state tax forms A sample waiver is included as Model Waiver L in the Appendix. 2014 state tax forms The registered ultimate vendor must have the waiver at the time the credit or payment is claimed. 2014 state tax forms   Noncommercial aviation means any use of an aircraft not described as commercial aviation. 2014 state tax forms For the definition of commercial aviation, see Commercial aviation on page 11. 2014 state tax forms Kerosene for use in nonexempt, noncommercial aviation. 2014 state tax forms   Only the registered ultimate vendor may claim a credit or payment for sales of kerosene for use in nonexempt, noncommercial aviation. 2014 state tax forms The ultimate vendor must be registered by the IRS (activity letter UA) and have the required certificate from the ultimate purchaser. 2014 state tax forms A sample certificate is included as Model Certificate Q in the Appendix. 2014 state tax forms The registered ultimate vendor must have the certificate at the time the credit or payment is claimed. 2014 state tax forms Kerosene for use in aviation by a state or local government. 2014 state tax forms   Only the registered ultimate vendor may claim a credit or payment for sales of kerosene for use in aviation to a state or local government for its exclusive use (including essential government use by an Indian tribal government). 2014 state tax forms The kerosene for use in aviation must be purchased by the state without the use of a credit card in order for the ultimate vendor to make the claim. 2014 state tax forms The ultimate vendor must be registered by the IRS (activity letter UV) and have the required certificate from the ultimate purchaser. 2014 state tax forms A sample certificate is included as Model Certificate P in the Appendix. 2014 state tax forms The registered ultimate vendor must have the certificate at the time the credit or payment is claimed. 2014 state tax forms Credit card purchases. 2014 state tax forms   If taxed kerosene for use in aviation is purchased with a credit card issued to a state, the person who extended credit to the state (the credit card issuer) is treated as the person that paid the tax and makes the claim if the credit card issuer: Is registered by the IRS, Has established that the amount of tax has not been collected from the person who purchased the kerosene, or has obtained written consent from the ultimate purchaser to the allowance of the credit or refund, and Has repaid or agreed to repay the amount of the tax to the ultimate vendor, has obtained the written consent of the ultimate vendor to the allowance of the credit or refund, or has made arrangements that provide the ultimate vendor with reimbursement of the tax. 2014 state tax forms   If the requirements above are not met by the credit card issuer, the credit card issuer must collect the tax from the ultimate purchaser and only the ultimate purchaser may make the claim. 2014 state tax forms Other Fuels (Including Alternative Fuels) Credit or refund for nontaxable use of taxed Other Fuels may be allowable to an ultimate purchaser. 2014 state tax forms While tax is generally imposed on delivery, Other Fuels are taxed prior to delivery in the case of certain bulk sales described in chapter 1. 2014 state tax forms The following are the nontaxable uses of Other Fuels for which a credit or refund may be allowable to the ultimate purchaser. 2014 state tax forms On a farm for farming purposes. 2014 state tax forms Off-highway business use. 2014 state tax forms In a boat engaged in commercial fishing. 2014 state tax forms In certain intercity and local buses. 2014 state tax forms In a school bus. 2014 state tax forms In a qualified local bus. 2014 state tax forms Exclusive use by a qualified blood collector organization. 2014 state tax forms Exclusive use by a nonprofit educational organization. 2014 state tax forms Exclusive use by a state, political subdivision of a state, or the District of Columbia. 2014 state tax forms In an aircraft or vehicle owned by an aircraft museum. 2014 state tax forms Use in any boat operated by the United States for its exclusive use or any vessel of war of any foreign nation. 2014 state tax forms See Biodiesel or Renewable Diesel Mixture Credit, Alternative Fuel Credit, and Alternative Fuel Mixture Credit, later. 2014 state tax forms Refunds of Second Tax The tax on dyed diesel fuel for inland waterways fuel use applies at the rate listed on Form 720. 2014 state tax forms This is in addition to all other taxes imposed on the sale or use of the fuel. 2014 state tax forms The section 4081(e) refund (discussed below) cannot be claimed. 2014 state tax forms If the tax is paid and reported to the government on more than one taxable event for a taxable fuel under section 4081, the person paying the “second tax” may claim a refund (without interest) of that tax if certain conditions and reporting requirements are met. 2014 state tax forms No credit against any tax is allowed for this tax. 2014 state tax forms For information about taxable events, see the discussions under Gasoline, Diesel Fuel and Kerosene and Kerosene for Use in Aviation in chapter 1. 2014 state tax forms Conditions to allowance of refund. 2014 state tax forms   A claim for refund of the tax is allowed only if all the following conditions are met. 2014 state tax forms A tax on the fuel was paid to the government and not credited or refunded (the “first tax”). 2014 state tax forms After the first tax was imposed, another tax was imposed on the same fuel and was paid to the government (the “second tax”). 2014 state tax forms The person that paid the second tax filed a timely claim for refund containing the information required (see Refund claim, later). 2014 state tax forms The person that paid the first tax has met the reporting requirements, discussed next. 2014 state tax forms Reporting requirements. 2014 state tax forms   Generally, the person that paid the first tax must file a “First Taxpayer's Report” with its Form 720 for the quarter to which the report relates. 2014 state tax forms A model first taxpayer's report is shown in the Appendix as Model Certificate B. 2014 state tax forms The report must contain all information needed to complete the model. 2014 state tax forms   By the due date for filing the Form 720, you must also send a separate copy of the report to the following address. 2014 state tax forms Department of the Treasury Internal Revenue Service  Cincinnati, OH 45999-0555 Write “EXCISE – FIRST TAXPAYER'S REPORT” across the top of that copy. 2014 state tax forms Optional reporting. 2014 state tax forms   A first taxpayer's report is not required for the tax imposed on: Removal at a terminal rack, Nonbulk entries into the United States, and Removals or sales by blenders. 2014 state tax forms However, if the person liable for the tax expects that another tax will be imposed on that fuel, that person should (but is not required to) file a first taxpayer's report. 2014 state tax forms Providing information. 2014 state tax forms   The first taxpayer must give a copy of the report to the buyer of the fuel within the bulk transfer/terminal system or to the owner of the fuel immediately before the first tax was imposed, if the first taxpayer is not the owner at that time. 2014 state tax forms If an optional report is filed, a copy should (but is not required to) be given to the buyer or owner. 2014 state tax forms   A person that receives a copy of the first taxpayer's report and later sells the fuel within the bulk transfer/terminal system must give the copy and a “Statement of Subsequent Seller” to the buyer. 2014 state tax forms If the later sale is outside the bulk transfer/terminal system and that person expects that another tax will be imposed, that person should (but is not required to) give the copy and the statement to the buyer. 2014 state tax forms A model statement of subsequent seller is shown in the Appendix as Model Certificate A. 2014 state tax forms The statement must contain all information necessary to complete the model. 2014 state tax forms   If the first taxpayer's report relates to fuel sold to more than one buyer, copies of that report must be made when the fuel is divided. 2014 state tax forms Each buyer must be given a copy of the report. 2014 state tax forms Refund claim. 2014 state tax forms   You must have filed Form 720 and paid the second tax before you file for a refund of that tax. 2014 state tax forms You must make your claim for refund on Form 8849. 2014 state tax forms Complete Schedule 5 (Form 8849) and attach it to your Form 8849. 2014 state tax forms Do not include this claim with a claim under another tax provision. 2014 state tax forms You must not have included the second tax in the price of the fuel and must not have collected it from the purchaser. 2014 state tax forms You must submit the following information with your claim. 2014 state tax forms A copy of the first taxpayer's report (discussed earlier). 2014 state tax forms A copy of the statement of subsequent seller if the fuel was bought from someone other than the first taxpayer. 2014 state tax forms Definitions of Nontaxable Uses This section provides definitions of the terms used in Table 2-1 for nontaxable uses. 2014 state tax forms If applicable, the type of use number from Table 2-1 is indicated in each heading. 2014 state tax forms Type of use table. 2014 state tax forms   The first column of the table is the number you enter on Form 4136, Form 8849, or Schedule C (Form 720) for that type of use. 2014 state tax forms For type of use 2, the mobile machinery parenthetical applies only to Form 8849 and Form 720. 2014 state tax forms Table 2-1. 2014 state tax forms Type of Use Table No. 2014 state tax forms Type of Use 1 On a farm for farming purposes 2 Off-highway business use (for business use other than in a highway vehicle registered or required to be registered for highway use) (other than use in mobile machinery) 3 Export 4 In a boat engaged in commercial fishing 5 In certain intercity and local buses 6 In a qualified local bus 7 In a bus transporting students and employees of schools (school buses) 8 For diesel fuel and kerosene (other than kerosene used in aviation) used other than as a fuel in the propulsion engine of a train or diesel-powered highway vehicle (but not off-highway business use) 9 In foreign trade 10 Certain helicopter and fixed-wing aircraft uses 11 Exclusive use by a qualified blood collector organization 12 In a highway vehicle owned by the United States that is not used on a highway 13 Exclusive use by a nonprofit educational organization 14 Exclusive use by a state, political subdivision of a state, or the District of Columbia 15 In an aircraft or vehicle owned by an aircraft museum 16 In military aircraft On a farm for farming purposes (No. 2014 state tax forms 1). 2014 state tax forms   On a farm for farming purposes means fuel used in carrying on a trade or business of farming, on a farm in the United States, and for farming purposes. 2014 state tax forms Farm. 2014 state tax forms   A farm includes livestock, dairy, fish, poultry, fruit, fur-bearing animals, and truck farms; orchards; plantations; ranches; nurseries; ranges; and feed yards for fattening cattle. 2014 state tax forms It also includes structures such as greenhouses used primarily for the raising of agricultural or horticultural commodities. 2014 state tax forms A fish farm is an area where fish are grown or raised — not merely caught or harvested. 2014 state tax forms Farming purposes. 2014 state tax forms   As an owner, tenant, or operator, you use fuel on a farm for farming purposes if you use it in any of the following ways. 2014 state tax forms To cultivate the soil or to raise or harvest any agricultural or horticultural commodity. 2014 state tax forms To raise, shear, feed, care for, train, or manage livestock, bees, poultry, fur-bearing animals, or wildlife. 2014 state tax forms To operate, manage, conserve, improve, or maintain your farm and its tools and equipment. 2014 state tax forms To handle, dry, pack, grade, or store any raw agricultural or horticultural commodity. 2014 state tax forms For this use to qualify, you must have produced more than half the commodity so treated during the tax year. 2014 state tax forms Commodity means a single raw product. 2014 state tax forms For example, apples and peaches are two separate commodities. 2014 state tax forms To plant, cultivate, care for, or cut trees or to prepare (other than sawing logs into lumber, chipping, or other milling) trees for market, but only if the planting, etc. 2014 state tax forms , is incidental to your farming operations. 2014 state tax forms Your tree operations will be incidental only if they are minor in nature when compared to the total farming operations. 2014 state tax forms   If any other person, such as a neighbor or custom operator, performs a service for you on your farm for any of the purposes listed in (1) or (2), you are considered to be the ultimate purchaser that used the fuel on a farm for farming purposes. 2014 state tax forms However, see Custom application of fertilizer and pesticide, next. 2014 state tax forms   If doubt exists whether the owner, the tenant, or the operator of the farm bought the fuel, determine who bore the cost of the fuel. 2014 state tax forms For example, if the owner of a farm and the tenant equally share the cost of gasoline that is used on a farm for farming purposes, each can claim a credit for the tax on one-half the fuel used. 2014 state tax forms Custom application of fertilizer and pesticide. 2014 state tax forms   Fuel used on a farm for farming purposes includes fuel used in the application of fertilizer, pesticides, or other substances, including aerial applications. 2014 state tax forms Generally, the applicator is treated as having used the fuel on a farm for farming purposes. 2014 state tax forms For aviation gasoline, the aerial applicator makes the claim as the ultimate purchaser. 2014 state tax forms For kerosene used in aviation, the ultimate purchaser may make the claim or waive their right to make the claim to the registered ultimate vendor. 2014 state tax forms Fuel used between airfield and farm. 2014 state tax forms   Fuel used by an aerial applicator for the direct flight between the airfield and one or more farms is treated as a farming purpose. 2014 state tax forms Fuel not used for farming. 2014 state tax forms   Fuel is not used on a farm for farming purposes if it is used in any of the following ways. 2014 state tax forms Off the farm, such as on the highway or in noncommercial aviation, other than fuel used between the airfield and farm described above, even if the fuel is used in transporting livestock, feed, crops, or equipment. 2014 state tax forms For personal use, such as mowing the lawn. 2014 state tax forms In processing, packaging, freezing, or canning operations. 2014 state tax forms In processing crude gum into gum spirits of turpentine or gum resin or in processing maple sap into maple syrup or maple sugar. 2014 state tax forms Off-highway business use (No. 2014 state tax forms 2). 2014 state tax forms   Off-highway business use means fuel used in a trade or business or in an income-producing activity other than as a fuel in a highway vehicle registered or required to be registered for use on public highways. 2014 state tax forms The terms “highway vehicle,” “public highway,” and “registered” are defined below. 2014 state tax forms Do not consider any use in a boat as an off-highway business use. 2014 state tax forms   Off-highway business use includes fuels used in any of the following ways. 2014 state tax forms In stationary machines such as generators, compressors, power saws, and similar equipment. 2014 state tax forms For cleaning purposes. 2014 state tax forms In forklift trucks, bulldozers, and earthmovers. 2014 state tax forms   Generally, this use does not include nonbusiness use of fuel, such as use by minibikes, snowmobiles, power lawn mowers, chain saws, and other yard equipment. 2014 state tax forms Example. 2014 state tax forms Caroline owns a landscaping business. 2014 state tax forms She uses power lawn mowers and chain saws in her business. 2014 state tax forms The gasoline used in the power lawn mowers and chain saws qualifies as fuel used in an off-highway business use. 2014 state tax forms The gasoline used in her personal lawn mower at home does not qualify. 2014 state tax forms Highway vehicle. 2014 state tax forms   A highway vehicle is any self-propelled vehicle designed to carry a load over public highways, whether or not it is also designed to perform other functions. 2014 state tax forms Examples of vehicles designed to carry a load over public highways are passenger automobiles, motorcycles, buses, and highway-type trucks and truck tractors. 2014 state tax forms A vehicle is a highway vehicle even though the vehicle's design allows it to perform a highway transportation function for only one of the following. 2014 state tax forms A particular type of load, such as passengers, furnishings, and personal effects (as in a house, office, or utility trailer). 2014 state tax forms A special kind of cargo, goods, supplies, or materials. 2014 state tax forms Some off-highway task unrelated to highway transportation, except as discussed next. 2014 state tax forms Vehicles not considered highway vehicles. 2014 state tax forms   Generally, the following kinds of vehicles are not considered highway vehicles for purposes of the credit or refund of fuel taxes. 2014 state tax forms Specially designed mobile machinery for nontransportation functions. 2014 state tax forms A self-propelled vehicle is not a highway vehicle if all the following apply. 2014 state tax forms The chassis has permanently mounted to it machinery or equipment used to perform certain operations (construction, manufacturing, drilling, mining, timbering, processing, farming, or similar operations) if the operation of the machinery or equipment is unrelated to transportation on or off the public highways. 2014 state tax forms The chassis has been specially designed to serve only as a mobile carriage and mount (and power source, if applicable) for the machinery or equipment, whether or not the machinery or equipment is in operation. 2014 state tax forms The chassis could not, because of its special design and without substantial structural modification, be used as part of a vehicle designed to carry any other load. 2014 state tax forms The vehicle must have traveled less than 7,500 miles on public highways during the taxable year. 2014 state tax forms Vehicles specially designed for off-highway transportation. 2014 state tax forms A vehicle is not treated as a highway vehicle if the vehicle is specially designed for the primary function of transporting a particular type of load other than over the public highway and because of this special design, the vehicle's capability to transport a load over a public highway is substantially limited or impaired. 2014 state tax forms To make this determination, you can take into account the vehicle's size, whether the vehicle is subject to licensing, safety, or other requirements, and whether the vehicle can transport a load at a sustained speed of at least 25 miles per hour. 2014 state tax forms It does not matter that the vehicle can carry heavier loads off highway than it is allowed to carry over the highway. 2014 state tax forms Nontransportation trailers and semitrailers. 2014 state tax forms A trailer or semi-trailer is not treated as a highway vehicle if it is specially designed to function only as an enclosed stationary shelter for carrying on a nontransportation function at an off-highway site. 2014 state tax forms For example, a trailer that is capable only of functioning as an office for an off-highway construction operation is not a highway vehicle. 2014 state tax forms Public highway. 2014 state tax forms   A public highway includes any road in the United States that is not a private roadway. 2014 state tax forms This includes federal, state, county, and city roads and streets. 2014 state tax forms Registered. 2014 state tax forms   A vehicle is considered registered when it is registered or required to be registered for highway use under the law of any state, the District of Columbia, or any foreign country in which it is operated or situated. 2014 state tax forms Any highway vehicle operated under a dealer's tag, license, or permit is considered registered. 2014 state tax forms A highway vehicle is not considered registered solely because a special permit allows the vehicle to be operated at particular times and under specified conditions. 2014 state tax forms Dual use of propulsion motor. 2014 state tax forms   Off-highway business use does not include any fuel used in the propulsion motor of a registered highway vehicle even though that motor also operates special equipment by means of a power take-off or power transfer. 2014 state tax forms It does not matter if the special equipment is mounted on the vehicle. 2014 state tax forms Example. 2014 state tax forms The motor of a registered concrete-mixer truck operates both the engine and the mixing unit by means of a power take-off. 2014 state tax forms The fuel used in the motor to run the mixer is not off-highway business use. 2014 state tax forms Use in separate motor. 2014 state tax forms   Off-highway business use includes fuel used in a separate motor to operate special equipment, such as a refrigeration unit, pump, generator, or mixing unit. 2014 state tax forms If you draw fuel from the same tank that supplies fuel to the propulsion motor, you must figure the quantity used in the separate motor operating the special equipment. 2014 state tax forms You may make a reasonable estimate based on your operating experience and supported by your records. 2014 state tax forms   You can use devices that measure the miles the vehicle has traveled (such as hubometers) to figure the gallons of fuel used to propel the vehicle. 2014 state tax forms Add to this amount the fuel consumed while idling or warming up the motor before propelling the vehicle. 2014 state tax forms The difference between your total fuel used and the fuel used to propel the vehicle is the fuel used in the separate motor. 2014 state tax forms Example. 2014 state tax forms Hazel owns a refrigerated truck. 2014 state tax forms It has a separate motor for the refrigeration unit. 2014 state tax forms The same tank supplies both motors. 2014 state tax forms Using the truck's hubometer, Hazel figures that 90% of the fuel was used to propel the truck. 2014 state tax forms Therefore, 10% of the fuel is used in an off-highway business use. 2014 state tax forms Fuel lost or destroyed. 2014 state tax forms   You cannot treat fuel lost or destroyed through spillage, fire, or other casualty as fuel used in an off-highway business use. 2014 state tax forms Export (No. 2014 state tax forms 3). 2014 state tax forms   Export means fuel transported from the United States with the intention that the fuel remain in a foreign country or possession of the United States. 2014 state tax forms Fuel is not exported if it is in the fuel supply tank of a vehicle or aircraft. 2014 state tax forms In a boat engaged in commercial fishing (No. 2014 state tax forms 4). 2014 state tax forms   In a boat engaged in commercial fishing means fuel used in taking, catching, processing, or transporting fish, shellfish, or other aquatic life for commercial purposes, such as selling or processing the catch, on a specific trip basis. 2014 state tax forms They include boats used in both fresh and salt water fishing. 2014 state tax forms They do not include boats used for both sport fishing and commercial fishing on the same trip. 2014 state tax forms In certain intercity and local buses (No. 2014 state tax forms 5). 2014 state tax forms   In certain intercity and local buses means fuel used in a bus engaged in furnishing (for compensation) passenger land transportation available to the general public. 2014 state tax forms The bus must be engaged in one of the following activities. 2014 state tax forms Scheduled transportation along regular routes. 2014 state tax forms Nonscheduled operations if the seating capacity of the bus is at least 20 adults, not including the driver. 2014 state tax forms Vans and similar vehicles used for van-pooling or taxi service do not qualify. 2014 state tax forms Available to the general public. 2014 state tax forms   This means you offer service to more than a limited number of persons or organizations. 2014 state tax forms If a bus operator normally provides charter operations through travel agencies but has buses available for chartering by the general public, this service is available to the general public. 2014 state tax forms A bus does not qualify when its operator uses it to provide exclusive services to only one person, group, or organization. 2014 state tax forms Also, intercity bus transportation does not include transporting students and employees of schools or intercity transportation in a qualified local bus. 2014 state tax forms In a qualified local bus (No. 2014 state tax forms 6). 2014 state tax forms   In a qualified local bus means fuel used in a bus meeting all the following requirements. 2014 state tax forms It is engaged in furnishing (for compensation) intracity passenger land transportation available to the general public. 2014 state tax forms It operates along scheduled, regular routes. 2014 state tax forms It has a seating capacity of at least 20 adults (excluding the driver). 2014 state tax forms It is under contract with (or is receiving more than a nominal subsidy from) any state or local government to furnish the transportation. 2014 state tax forms Intracity passenger land transportation. 2014 state tax forms   This is the land transportation of passengers between points located within the same metropolitan area. 2014 state tax forms It includes transportation along routes that cross state, city, or county boundaries if the routes remain within the metropolitan area. 2014 state tax forms Under contract. 2014 state tax forms   A bus is under contract with a state or local government only if the contract imposes a bona fide obligation on the bus operator to furnish the transportation. 2014 state tax forms More than a nominal subsidy. 2014 state tax forms   A subsidy is more than nominal if it is reasonably expected to exceed an amount equal to 3 cents multiplied by the number of gallons of fuel used in buses on subsidized routes. 2014 state tax forms A company that operates its buses along subsidized and unsubsidized intracity routes may consider its buses qualified local buses only when the buses are used on the subsidized intracity routes. 2014 state tax forms In a school bus (No. 2014 state tax forms 7). 2014 state tax forms   In a school bus means fuel used in a bus engaged in the transportation of students or employees of schools. 2014 state tax forms A school is an educational organization with a regular faculty and curriculum and a regularly enrolled body of students who attend the place where the educational activities occur. 2014 state tax forms For diesel fuel and kerosene (other than kerosene used in aviation) used other than as a fuel (No. 2014 state tax forms 8). 2014 state tax forms   Diesel fuel and kerosene (other than kerosene used in aviation) used other than as a fuel in the propulsion engine of a diesel-powered highway vehicle or diesel-powered train (not including off-highway business use) means undyed diesel fuel and undyed kerosene used: For home heating, lighting, and cooking; In boats; In stationary machines, such as generators and compressors; For cleaning purposes; or In minibikes and snowmobiles. 2014 state tax forms In foreign trade (No. 2014 state tax forms 9). 2014 state tax forms   In foreign trade means fuel used in civil aircraft employed in foreign trade or trade between the United States and any of its possessions. 2014 state tax forms The term trade includes the transportation of persons or property for hire and the making of the necessary preparations for such transportation. 2014 state tax forms In the case of aircraft registered in a foreign country, the country must allow reciprocal benefits for aircraft registered in the United States. 2014 state tax forms Certain helicopter and fixed-wing aircraft uses (No. 2014 state tax forms 10). 2014 state tax forms   Includes: Certain helicopter uses. 2014 state tax forms   Certain helicopter uses means fuel used by a helicopter for any of the following purposes. 2014 state tax forms Transporting individuals, equipment, or supplies in the exploration for, or the development or removal of, hard minerals, oil, or gas. 2014 state tax forms Planting, cultivating, cutting, transporting, or caring for trees (including logging operations). 2014 state tax forms Providing emergency medical transportation. 2014 state tax forms   During a use described in items (1) and (2), the helicopter must not take off from, or land at, a facility eligible for assistance under the Airport and Airway Development Act of 1970, or otherwise use services provided pursuant to section 44509 or 44913(b) or subchapter I of chapter 471 of title 49, United States Code. 2014 state tax forms For item (1), treat each flight segment as a separate flight. 2014 state tax forms Fixed-wing aircraft uses. 2014 state tax forms   Fixed-wing aircraft uses means fuel used by a fixed-wing aircraft for any of the following purposes. 2014 state tax forms Planting, cultivating, cutting, transporting, or caring for trees (including logging operations). 2014 state tax forms Providing emergency medical transportation. 2014 state tax forms The aircraft must be equipped for and exclusively dedicated on that flight to acute care emergency medical services. 2014 state tax forms During a use described in item (1), the aircraft must not take off from, or land at, a facility eligible for assistance under the Airport and Airway Development Act of 1970, or otherwise use services provided pursuant to section 44509 or 44913(b) or subchapter I of chapter 471 of title 49, United States Code. 2014 state tax forms Exclusive use by a qualified blood collector organization (No. 2014 state tax forms 11). 2014 state tax forms   Exclusive use by a qualified blood collector organization means fuel used by the qualified blood collector organization for its exclusive use in the collection, storage, or transportation of blood. 2014 state tax forms Qualified blood collector organization. 2014 state tax forms   A qualified blood collector organization is one that is: Described in section 501(c)(3) and exempt from tax under section 501(a), Primarily engaged in the activity of collecting human blood, Registered by the IRS, and Registered by the Food and Drug Administration to collect blood. 2014 state tax forms In a highway vehicle owned by the United States that is not used on a highway (No. 2014 state tax forms 12). 2014 state tax forms   In a highway vehicle owned by the United States that is not used on a highway means fuel used in a vehicle that was not used on public highways during the period covered by the claim. 2014 state tax forms This use applies whether or not the vehicle is registered or required to be registered for highway use. 2014 state tax forms Exclusive use by a nonprofit educational organization (No. 2014 state tax forms 13). 2014 state tax forms   Exclusive use by a nonprofit educational organization means fuel used by an organization exempt from income tax under section 501(a) that meets both of the following requirements. 2014 state tax forms It has a regular faculty and curriculum. 2014 state tax forms It has a regularly enrolled body of students who attend the place where the instruction normally occurs. 2014 state tax forms   A nonprofit educational organization also includes a school operated by a church or other organization described in section 501(c)(3) if the school meets the above requirements. 2014 state tax forms Exclusive use by a state, political subdivision of a state, or the District of Columbia (No. 2014 state tax forms 14). 2014 state tax forms   Exclusive use by a state, political subdivision of a state, or the District of Columbia means fuel purchased by the state or local government for its exclusive use. 2014 state tax forms A state or local government is any state, any political subdivision thereof, or the District of Columbia. 2014 state tax forms An Indian tribal government is treated as a state only if the fuel is used in an activity that involves the exercise of an essential tribal government function. 2014 state tax forms Gasoline, diesel fuel, and kerosene used by the American Red Cross is considered to be the use of these fuels by a state. 2014 state tax forms In an aircraft or vehicle owned by an aircraft museum (No. 2014 state tax forms 15). 2014 state tax forms   In an aircraft or vehicle owned by an aircraft museum means fuel used in an aircraft or vehicle that is owned by an organization that meets all the following requirements. 2014 state tax forms It is exempt from income tax as an organization described in section 501(c)(3). 2014 state tax forms It is operated as a museum under a state (or District of Columbia) charter. 2014 state tax forms It is operated exclusively for acquiring, exhibiting, and caring for aircraft of the type used for combat or transport in  World War II. 2014 state tax forms   The aircraft or vehicle (such as a ground servicing vehicle for aircraft) must be used exclusively for the purposes described in item (3). 2014 state tax forms In military aircraft (No. 2014 state tax forms 16). 2014 state tax forms   In a military aircraft means fuel used in an aircraft owned by the United States or any foreign nation and constituting a part of its armed forces. 2014 state tax forms In commercial aviation (other than foreign trade). 2014 state tax forms   See Commercial aviation, earlier, for the definition. 2014 state tax forms Use in a train. 2014 state tax forms   Use in a train means fuel used in the propulsion engine of equipment or machinery that rides on rails. 2014 state tax forms This includes use in a locomotive, work train, switching engine, and track maintenance machine. 2014 state tax forms Biodiesel or Renewable Diesel Mixture Credit, Alternative Fuel Credit, and Alternative Fuel Mixture Credit For alternative fuel mixtures produced after December 31, 2011, see How to Claim the Credit below. 2014 state tax forms The section 6426 credit for biodiesel and alternative fuel consists of the biodiesel or renewable diesel mixture credit, alternative fuel credit, and alternative fuel mixture credit. 2014 state tax forms Biodiesel or renewable diesel mixture credit claimant. 2014 state tax forms   Claimant produced a biodiesel mixture by mixing biodiesel with diesel fuel. 2014 state tax forms Claimant produced a renewable diesel mixture by mixing renewable diesel with liquid fuel (other than renewable diesel). 2014 state tax forms   The person that produced and sold or used the mixture in their trade or business is the only person eligible to make this claim. 2014 state tax forms The credit is based on the gallons of biodiesel or renewable diesel in the mixture. 2014 state tax forms Renewable diesel does not include any fuel derived from coprocessing biomass (as defined in section 45K(c)(3)) with a feedstock that is not biomass. 2014 state tax forms Claim requirements. 2014 state tax forms   See the Instructions for Form 720 for the biodiesel or renewable diesel mixture claim requirements. 2014 state tax forms Alternative fuel credit claimant. 2014 state tax forms   For the alternative fuel credit, the registered alternative fueler who (1) sold an alternative fuel at retail delivered it into the fuel supply tank of a motor vehicle or motorboat, (2) sold an alternative fuel, delivered it in bulk taxable use in a motor vehicle or motorboat, and received required statement from the buyer, (3) used an alternative fuel (not sold at retail or in bulk as previously described) motor vehicle or motorboat, or (4) sold an alternative fuel used as a fuel in aviation is the only person eligible to make this claim. 2014 state tax forms Carbon capture requirement. 2014 state tax forms   A credit for Fischer-Tropsch process liquid fuel derived from coal (including peat) can be claimed only if the fuel is derived from coal produced at a gasification facility that separates and sequesters at least 75% of the facility's total carbon dioxide emissions. 2014 state tax forms Alternative fuel credit. 2014 state tax forms   The registered alternative fueler is the person eligible to make the claim. 2014 state tax forms An alternative fueler is the person liable for tax on alternative fuel under the rules for taxable events for Other Fuels (discussed in chapter 1) or would be liable but for an exemption for nontaxable uses. 2014 state tax forms An alternative fueler includes a person who sells for use or uses an alternative fuel in aviation. 2014 state tax forms Alternative fuel mixture credit claimant. 2014 state tax forms   For the alternative fuel mixture credit, the registered alternative fueler that produced and sold or used the mixture as a fuel in their trade or business is the only person eligible to make this claim. 2014 state tax forms The credit is based on the gallons of alternative fuel in the mixture. 2014 state tax forms An alternative fuel mixture is a mixture of alternative fuel and section 4081 taxable fuel (gasoline, diesel fuel, or kerosene). 2014 state tax forms Registration. 2014 state tax forms   You must be registered by the IRS to be eligible to claim the section 6426 fuel credit. 2014 state tax forms See Registration Requirements in chapter 1. 2014 state tax forms Credits for fuel provide incentive for United States production. 2014 state tax forms   The section 6426 fuel credit may not be claimed for alternative fuel that is produced outside the United States for use as a fuel outside the United States. 2014 state tax forms The United States includes any possession of the United States. 2014 state tax forms Credit for fuels derived from paper or pulp production. 2014 state tax forms   Credit for alternative fuels and alternative fuel mixtures for any fuel derived from the production of paper or pulp are not available for fuel sold or used on or after December 31, 2009. 2014 state tax forms How to Claim the Credit Any biodiesel or renewable diesel mixture credit must first be claimed on Schedule C to reduce your taxable fuel liability reported on Form 720. 2014 state tax forms Any excess credit may be claimed on Schedule C (Form 720), Schedule 3 (Form 8849), Form 4136, or Form 8864, Biodiesel and Renewable Diesel Fuels Credit. 2014 state tax forms See Notice 2005-4 and the Instructions for Form 720 for more information. 2014 state tax forms Also see Notice 2013-26 on page 984 of I. 2014 state tax forms R. 2014 state tax forms B. 2014 state tax forms 2013-18 at www. 2014 state tax forms irs. 2014 state tax forms gov/pub/irs-irbs/irb13-18. 2014 state tax forms pdf; and see chapter 2, later. 2014 state tax forms Coordination with income tax credit. 2014 state tax forms   Only one credit may be taken for any amount of biodiesel or renewable diesel. 2014 state tax forms If any amount is claimed (or will be claimed) for any amount of biodiesel or renewable diesel on Form 720, Form 8849, or Form 4136, then a claim cannot be made on Form 8864 for that amount of biodiesel or renewable diesel. 2014 state tax forms   Any alternative fuel credit must first be claimed on Schedule C (Form 720) to reduce your section 4041 taxable fuel liability for alternative fuel and CNG reported on Form 720. 2014 state tax forms Any excess credit may claimed on Schedule C (Form 720), Schedule 3 (Form 8849), or Form 4136. 2014 state tax forms   For alternative fuel mixtures produced after December 31, 2011, the alternative fuel mixture credit can be claimed on Schedule C (Form 720), not on Form 4136 or Schedule 3 (Form 8849), and only to the extent of your section 4081 taxable fuel liability for gasoline, diesel fuel and kerosene reported on Form 720. 2014 state tax forms   Calculate the limitation for alternative fuel mixtures separately and enter on Schedule C (Form 720), line 14, only the gallons of mixtures that do not exceed your section 4081 taxable fuel liability. 2014 state tax forms Filing Claims This section tells you how to make a claim for a credit or refund of excise taxes on fuels. 2014 state tax forms This section also covers recordkeeping requirements and when to include the credit or refund in your income. 2014 state tax forms Generally, you will provide all the information needed to claim a credit or refund when you properly complete Form 8849, Form 4136, Schedule C (Form 720), Form 6478, or Form 8864. 2014 state tax forms In some cases, you will have to attach additional information. 2014 state tax forms You need to keep records that support your claim for a credit or refund. 2014 state tax forms Keep at your principal place of business all records needed to enable the IRS to verify that you are the person entitled to claim a credit or refund and the amount you claimed. 2014 state tax forms Ultimate purchaser. 2014 state tax forms   Ultimate purchasers may make claims for the nontaxable use of fuels on Form 4136, Schedule 1 (Form 8849), and Schedule C (Form 720) if reporting excise tax liability on that return. 2014 state tax forms If you are an ultimate purchaser, you must keep the following records. 2014 state tax forms The number of gallons purchased and used during the period covered by your claim. 2014 state tax forms The dates of the purchases. 2014 state tax forms The names and addresses of suppliers and amounts purchased from each in the period covered by your claim. 2014 state tax forms The nontaxable use for which you used the fuel. 2014 state tax forms The number of gallons used for each nontaxable use. 2014 state tax forms It is important that your records show separately the number of gallons used for each nontaxable use that qualifies as a claim. 2014 state tax forms If the fuel is exported, you must have proof of exportation. 2014 state tax forms   For more information about keeping records, see Publication 583, Starting a Business and Keeping Records, or chapter 1 of Publication 17, Your Federal Income Tax for Individuals. 2014 state tax forms Exceptions. 2014 state tax forms    Generally, the ultimate purchaser may not claim a credit or refund for undyed diesel fuel, undyed kerosene, or kerosene for use in aviation sold for the exclusive use of a state or local government. 2014 state tax forms However, see Claims by credit card issuers, later, for an exception. 2014 state tax forms The ultimate purchaser may not claim a credit or refund as follows. 2014 state tax forms The ultimate purchaser of gasoline or aviation gasoline used by a state or local government for its exclusive use or by a nonprofit educational organization for its exclusive use may waive its right to make a claim by providing a certificate that is signed under penalties of perjury by a person authorized to bind the ultimate purchaser and is in the same format as the Model Certificate M. 2014 state tax forms A new certificate is required each year or when any information in the current certificate expires. 2014 state tax forms The ultimate purchaser of kerosene for use in commercial aviation or noncommercial aviation (other than nonexempt, noncommercial aviation and exclusive use by a state, political subdivision of a state, or the District of Columbia) may waive its right to make a claim by providing a waiver that is signed under penalties of perjury by a person authorized to bind the ultimate purchaser and is in the same format as the Model Waiver L. 2014 state tax forms A new waiver is required each year or when any information in the current waiver expires. 2014 state tax forms The ultimate purchaser of undyed diesel fuel or undyed kerosene used in certain intercity and local buses may waive its right to make a claim by providing a waiver that is signed under penalties of perjury by a person authorized to bind the ultimate purchaser and is in the same format as the Model Waiver N. 2014 state tax forms A new waiver is required each year or when any information in the current waiver expires. 2014 state tax forms The ultimate purchaser of kerosene for use in nonexempt, noncommercial aviation must provide a certificate that is signed under penalties of perjury by a person authorized to bind the ultimate purchaser and is in the same format as the Model Certificate Q. 2014 state tax forms A new certificate is required each year or when any information in the current certificate expires. 2014 state tax forms Registered ultimate vendor. 2014 state tax forms   Registered ultimate vendors may make claims for certain sales of fuels on Form 4136, Schedule 2 (Form 8849), and Schedule C (Form 720) if reporting excise tax liability on that return. 2014 state tax forms If you are a registered ultimate vendor, you must keep certain information pertaining to the sale of the fuel. 2014 state tax forms   To make a claim, you must have sold the fuel at a tax-excluded price, repaid the tax to the buyer, or obtained the buyer's written consent to the allowance of the claim. 2014 state tax forms You are required to have a valid certificate or waiver in your possession in order to make the claim. 2014 state tax forms   In addition, you must have a registration number that has not been revoked or suspended. 2014 state tax forms See Form 637. 2014 state tax forms State use. 2014 state tax forms   To make a claim as an ultimate vendor (state), you must have a UV registration number and the fuel cannot be purchased with a credit card as explained below. 2014 state tax forms If you sell undyed diesel fuel, undyed kerosene, or kerosene for use in aviation for use by a state or local government, you must keep the following information. 2014 state tax forms The name and taxpayer identification number of each person (government unit) that bought the fuel. 2014 state tax forms The number of gallons sold to each person. 2014 state tax forms An unexpired certificate from the buyer. 2014 state tax forms See Model Certificate P in the Appendix. 2014 state tax forms The certificate expires on the earlier of 1 year after the date of the certificate or the date a new certificate is given to the registered ultimate vendor. 2014 state tax forms Nonprofit educational organization and state use. 2014 state tax forms   To make a claim as an ultimate vendor (nonprofit educational organization or state), you must have a UV registration number and the fuel cannot be purchased with a credit card as explained later. 2014 state tax forms If you sell gasoline or aviation gasoline to a nonprofit educational organization for its exclusive use or to a state or local government for its exclusive use, you must keep the following information. 2014 state tax forms The name and taxpayer identification number of each person (nonprofit educational organization or government unit) that bought the fuel. 2014 state tax forms The number of gallons sold to each person. 2014 state tax forms An unexpired certificate from the buyer. 2014 state tax forms See Model Certificate M in the Appendix. 2014 state tax forms  The certificate expires on the earlier of 1 year after the date of the certificate or the date a new certificate is given to the registered ultimate vendor. 2014 state tax forms Blocked pump. 2014 state tax forms   To make a claim as an ultimate vendor (blocked pump), you must have a UP registration number. 2014 state tax forms If you sell undyed kerosene (other than kerosene for use in aviation) from a pump that qualifies as a blocked pump because it is locked by you after each sale and is unlocked by you at the request of the buyer, you must keep the following information for each sale of more than 5 gallons. 2014 state tax forms The date of each sale. 2014 state tax forms The name and address of the buyer. 2014 state tax forms The number of gallons sold to that buyer. 2014 state tax forms Certain intercity and local bus use. 2014 state tax forms   To make a claim as an ultimate vendor of undyed diesel fuel or undyed kerosene used in certain intercity and local buses, you must have a UB registration number. 2014 state tax forms You must keep the following information. 2014 state tax forms The date of each sale. 2014 state tax forms The name and address of the buyer. 2014 state tax forms The number of gallons sold to the buyer. 2014 state tax forms A copy of the waiver signed by the buyer at the time the credit or payment is claimed. 2014 state tax forms See Model Waiver N in the Appendix. 2014 state tax forms Kerosene for use in commercial aviation or noncommercial aviation. 2014 state tax forms   To make a claim as an ultimate vendor of kerosene for use in commercial aviation (other than foreign trade) or noncommercial aviation (other than nonexempt, noncommercial aviation and exclusive use by a state, political subdivision of a state, or the District of Columbia), you must have a UA registration number. 2014 state tax forms See Kerosene for use in aviation, earlier, for a list of nontaxable uses. 2014 state tax forms You must keep the following information. 2014 state tax forms The date of each sale. 2014 state tax forms The name and address of the buyer. 2014 state tax forms The number of gallons sold to the buyer. 2014 state tax forms A copy of the waiver signed by the buyer at the time the credit or payment is claimed. 2014 state tax forms See Model Waiver L in the Appendix. 2014 state tax forms Kerosene for use in nonexempt, noncommercial aviation. 2014 state tax forms   To make a claim as an ultimate vendor of kerosene for use in nonexempt, noncommercial aviation, you must have a UA registration number. 2014 state tax forms You must keep the following information. 2014 state tax forms The date of each sale. 2014 state tax forms The name and address of the buyer. 2014 state tax forms The number of gallons sold to the buyer. 2014 state tax forms A copy of the certificate signed by the buyer at the time the credit or payment is claimed. 2014 state tax forms See Model Certificate Q in the Appendix. 2014 state tax forms Claims by credit card issuers. 2014 state tax forms   For sales of gasoline, aviation gasoline, diesel fuel, kerosene, or kerosene for use in aviation that are purchased by an exempt user with the use of a credit card, the registered credit card issuer is the only person who can make the claim. 2014 state tax forms An exempt user for this purpose is: For gasoline or aviation gasoline, a state or local government (including essential government use by an Indian tribal government) or a nonprofit educational organization; or For diesel fuel, kerosene, or kerosene for use in aviation, a state or local government (including essential government use by an Indian tribal government). 2014 state tax forms   If gasoline is purchased without the use of a credit card, then the registered ultimate vendor of the gasoline may make the claim for refund or credit. 2014 state tax forms However, if the gasoline is purchased with a credit card issued to a state, but the credit card issuer is not registered by the IRS or does not meet the conditions described, the credit card issuer must collect the tax and the state may make the claim. 2014 state tax forms   If diesel fuel, kerosene, or kerosene for use in aviation is purchased without the use of a credit card, the registered ultimate vendor may make the claim for refund or credit. 2014 state tax forms A state is not allowed to make a claim for these fuels. 2014 state tax forms However, if the diesel fuel or kerosene is purchased with a credit card issued to a state, but the credit card issuer is not registered by the IRS or does not meet the conditions described, the credit card issuer must collect the tax and the state may make the claim. 2014 state tax forms   The claim from the credit card issuer must contain the following information as it applies to the fuel covered in the claim. 2014 state tax forms The total number of gallons. 2014 state tax forms Its registration number. 2014 state tax forms A statement that it has not collected the amount of tax from the ultimate purchaser or has obtained the written consent of the ultimate purchaser to make the claim. 2014 state tax forms A statement that it has repaid or agreed to repay the amount of tax to the ultimate vendor, has obtained the written consent of the ultimate vendor to make the claim, or has otherwise made arrangements which directly or indirectly provide the ultimate vendor with reimbursement of the tax. 2014 state tax forms Has in its possession an unexpired certificate similar to Model Certificate R in the Appendix and has no reason to believe any of the information in the certificate is false. 2014 state tax forms Taxpayer identification number. 2014 state tax forms   To file a claim, you must have a taxpayer identification number. 2014 state tax forms Your taxpayer identification number can be an: Employer identification number (EIN), Social security number (SSN), or Individual taxpayer identification number (ITIN), if you are an alien individual and do not have and are not eligible to get an SSN. 2014 state tax forms   If you normally file only a U. 2014 state tax forms S. 2014 state tax forms individual income tax return (such as Form 1040 or 1040NR), use your SSN or ITIN. 2014 state tax forms You get an SSN by filing Form SS-5, Application for a Social Security Card, with the Social Security Administration. 2014 state tax forms To get an ITIN, file Form W-7, Application for IRS Individual Taxpayer Identification Number, with the IRS. 2014 state tax forms   If you operate a business, use your EIN. 2014 state tax forms If you do not have an EIN, you may apply for one online. 2014 state tax forms Go to the IRS website at irs. 2014 state tax forms gov/businesses/small and click on the “Employer ID Numbers (EINs)” link. 2014 state tax forms You may also apply for an EIN by calling 1-800-829-4933, or you can fax or mail Form SS-4, Application for Employer Identification Number, to the IRS. 2014 state tax forms Claiming A Refund Generally, you may claim a refund of excise taxes on Form 8849. 2014 state tax forms Complete and attach to Form 8849 the appropriate Form 8849 schedules. 2014 state tax forms The instructions for Form 8849 and the separate instructions for each schedule explain the requirements for making a claim for refund. 2014 state tax forms If you file Form 720, you can use the Schedule C (Form 720) for your refund claims for the quarter. 2014 state tax forms See the Instructions for Form 720. 2014 state tax forms Do not claim a refund on Form 8849 for any amount for which you have filed or will file a claim on Schedule C (Form 720) or Form 4136. 2014 state tax forms The alternative fuel mixture credit must be claimed on Schedule C (Form 720) against your section 4081 taxable fuel liability for gasoline, diesel, and kerosene and any excess is not allowed. 2014 state tax forms The alternative fuel credit must first be claimed on Schedule C (Form 720) against your section 4041 taxable fuel liability for alternative fuel and CNG. 2014 state tax forms To the extent the alternative fuel credit exceeds this taxable fuel liability, a payment is allowed and may be claimed as a credit on Schedule C (Form 720), or as an income tax credit on Forms 4136, 6478, or 8864, as applicable. 2014 state tax forms Only one claim may be made for any particular amount of alternative fuel. 2014 state tax forms Claiming a Credit on Form 4136 For alternative fuel mixtures produced after December 31, 2011, the alternative fuel mixture credit cannot be claimed on Form 4136. 2014 state tax forms See Biodiesel or Renewable Diesel Mixture Credit, Alternative Fuel Credit and Alternative Fuel Mixture Credit in chapter 2, earlier. 2014 state tax forms A credit may be claimed for certain uses and sales of fuels on Form 4136 when you file your income tax return at the end of the year. 2014 state tax forms If you meet certain requirements (discussed earlier), you may be able to make a claim during the year. 2014 state tax forms Credit only. 2014 state tax forms   You can claim the following taxes only as a credit on Form 4136. 2014 state tax forms Tax on fuels used for nontaxable uses if the total for your tax year is less than $750. 2014 state tax forms Tax on fuel you did not include in any claim for refund previously filed for any quarter of your tax year. 2014 state tax forms Tax on fuel you used in mobile machinery (off-highway business use) that traveled less than 7,500 miles on public highways. 2014 state tax forms Do not claim a credit for any amount for which you have filed a refund claim on Form 8849 or credit on Schedule C (Form 720). 2014 state tax forms When to file. 2014 state tax forms   You can claim a fuel tax credit on your income tax return for the year you used the fuel (or sold the fuel in the case of a registered ultimate vendor claim). 2014 state tax forms You may be able to make a fuel tax claim on an amended income tax return for the year you used the fuel. 2014 state tax forms Generally, you must file an amended return by the later of 3 years from the date you filed your original return or within 2 years from the date you paid the income tax. 2014 state tax forms How to claim a credit. 2014 state tax forms   How you claim a credit depends on whether you are an individual, partnership, corporation, S corporation, or farmers' cooperative association. 2014 state tax forms Individuals. 2014 state tax forms   You claim the credit on the “Credits from” line of Form 1040. 2014 state tax forms Also check box b on that line. 2014 state tax forms If you would not otherwise have to file an income tax return, you must do so to get a fuel tax credit. 2014 state tax forms Partnerships. 2014 state tax forms   Partnerships (other than electing large partnerships) claim the credit by including a statement on Schedule K-1 (Form 1065), Partner's Share of Income, Deductions, Credits, etc. 2014 state tax forms , showing each partner's share of the number of gallons of each fuel sold or used for a non
Español

Office of Scientific and Technical Information

The Office of Scientific and Technical Information collects, preserves, and makes available the results of research and development carried out or sponsored by the Department of Energy.

Contact the Agency or Department

Website: Office of Scientific and Technical Information

E-mail:

Address: Office of Scientific and Technical Information
P.O. Box 62

Oak Ridge, TN 37831

Phone Number: (865) 576-1188(856) 576-8401 (Document Requests)

The 2014 State Tax Forms

2014 state tax forms Publication 530 - Main Content Table of Contents What You Can and Cannot DeductHardest Hit Fund and Emergency Homeowners' Loan Programs Real Estate Taxes Sales Taxes Home Mortgage Interest Mortgage Insurance Premiums Mortgage Interest CreditFiguring the Credit BasisFiguring Your Basis Adjusted Basis Keeping Records How To Get Tax HelpLow Income Taxpayer Clinics What You Can and Cannot Deduct To deduct expenses of owning a home, you must file Form 1040, U. 2014 state tax forms S. 2014 state tax forms Individual Income Tax Return, and itemize your deductions on Schedule A (Form 1040). 2014 state tax forms If you itemize, you cannot take the standard deduction. 2014 state tax forms This section explains what expenses you can deduct as a homeowner. 2014 state tax forms It also points out expenses that you cannot deduct. 2014 state tax forms There are four primary discussions: real estate taxes, sales taxes, home mortgage interest, and mortgage insurance premiums. 2014 state tax forms Generally, your real estate taxes, home mortgage interest, and mortgage insurance premiums are included in your house payment. 2014 state tax forms Your house payment. 2014 state tax forms   If you took out a mortgage (loan) to finance the purchase of your home, you probably have to make monthly house payments. 2014 state tax forms Your house payment may include several costs of owning a home. 2014 state tax forms The only costs you can deduct are real estate taxes actually paid to the taxing authority, interest that qualifies as home mortgage interest, and mortgage insurance premiums. 2014 state tax forms These are discussed in more detail later. 2014 state tax forms   Some nondeductible expenses that may be included in your house payment include: Fire or homeowner's insurance premiums, and The amount applied to reduce the principal of the mortgage. 2014 state tax forms Minister's or military housing allowance. 2014 state tax forms   If you are a minister or a member of the uniformed services and receive a housing allowance that is not taxable, you still can deduct your real estate taxes and your home mortgage interest. 2014 state tax forms You do not have to reduce your deductions by your nontaxable allowance. 2014 state tax forms For more information see Publication 517, Social Security and Other Information for Members of the Clergy and Religious Workers, and Publication 3, Armed Forces' Tax Guide. 2014 state tax forms Nondeductible payments. 2014 state tax forms   You cannot deduct any of the following items. 2014 state tax forms Insurance (other than mortgage insurance premiums), including fire and comprehensive coverage, and title insurance. 2014 state tax forms Wages you pay for domestic help. 2014 state tax forms Depreciation. 2014 state tax forms The cost of utilities, such as gas, electricity, or water. 2014 state tax forms Most settlement costs. 2014 state tax forms See Settlement or closing costs under Cost as Basis, later, for more information. 2014 state tax forms Forfeited deposits, down payments, or earnest money. 2014 state tax forms Hardest Hit Fund and Emergency Homeowners' Loan Programs You can use a special method to compute your deduction for mortgage interest and real estate taxes on your main home if you meet the following two conditions. 2014 state tax forms You received assistance under: A State Housing Finance Agency (State HFA) Hardest Hit Fund program in which program payments could be used to pay mortgage interest, or An Emergency Homeowners' Loan Program administered by the Department of Housing and Urban Development (HUD) or a state. 2014 state tax forms You meet the rules to deduct all of the mortgage interest on your loan and all of the real estate taxes on your main home. 2014 state tax forms If you meet these tests, then you can deduct all of the payments you actually made during the year to your mortgage servicer, the State HFA, or HUD on the home mortgage (including the amount shown on box 3 of Form 1098-MA, Mortgage Assistance Payments), but not more than the sum of the amounts shown on Form 1098, Mortgage Interest Statement, in box 1 (mortgage interest received), box 4 (mortgage insurance premiums) and box 5 (real property taxes). 2014 state tax forms However, you are not required to use this special method to compute your deduction for mortgage interest and real estate taxes on your main home. 2014 state tax forms Real Estate Taxes Most state and local governments charge an annual tax on the value of real property. 2014 state tax forms This is called a real estate tax. 2014 state tax forms You can deduct the tax if it is assessed uniformly at a like rate on all real property throughout the community. 2014 state tax forms The proceeds must be for general community or governmental purposes and not be a payment for a special privilege granted or service rendered to you. 2014 state tax forms Deductible Real Estate Taxes You can deduct real estate taxes imposed on you. 2014 state tax forms You must have paid them either at settlement or closing, or to a taxing authority (either directly or through an escrow account) during the year. 2014 state tax forms If you own a cooperative apartment, see Special Rules for Cooperatives , later. 2014 state tax forms Where to deduct real estate taxes. 2014 state tax forms   Enter the amount of your deductible real estate taxes on Schedule A (Form 1040), line 6. 2014 state tax forms Real estate taxes paid at settlement or closing. 2014 state tax forms   Real estate taxes are generally divided so that you and the seller each pay taxes for the part of the property tax year you owned the home. 2014 state tax forms Your share of these taxes is fully deductible if you itemize your deductions. 2014 state tax forms Division of real estate taxes. 2014 state tax forms   For federal income tax purposes, the seller is treated as paying the property taxes up to, but not including, the date of sale. 2014 state tax forms You (the buyer) are treated as paying the taxes beginning with the date of sale. 2014 state tax forms This applies regardless of the lien dates under local law. 2014 state tax forms Generally, this information is included on the settlement statement you get at closing. 2014 state tax forms   You and the seller each are considered to have paid your own share of the taxes, even if one or the other paid the entire amount. 2014 state tax forms You each can deduct your own share, if you itemize deductions, for the year the property is sold. 2014 state tax forms Example. 2014 state tax forms You bought your home on September 1. 2014 state tax forms The property tax year (the period to which the tax relates) in your area is the calendar year. 2014 state tax forms The tax for the year was $730 and was due and paid by the seller on August 15. 2014 state tax forms You owned your new home during the property tax year for 122 days (September 1 to December 31, including your date of purchase). 2014 state tax forms You figure your deduction for real estate taxes on your home as follows. 2014 state tax forms 1. 2014 state tax forms Enter the total real estate taxes for the real property tax year $730 2. 2014 state tax forms Enter the number of days in the property tax year that you owned the property 122 3. 2014 state tax forms Divide line 2 by 365 . 2014 state tax forms 3342 4. 2014 state tax forms Multiply line 1 by line 3. 2014 state tax forms This is your deduction. 2014 state tax forms Enter it on Schedule A (Form 1040), line 6 $244   You can deduct $244 on your return for the year if you itemize your deductions. 2014 state tax forms You are considered to have paid this amount and can deduct it on your return even if, under the contract, you did not have to reimburse the seller. 2014 state tax forms Delinquent taxes. 2014 state tax forms   Delinquent taxes are unpaid taxes that were imposed on the seller for an earlier tax year. 2014 state tax forms If you agree to pay delinquent taxes when you buy your home, you cannot deduct them. 2014 state tax forms You treat them as part of the cost of your home. 2014 state tax forms See Real estate taxes , later, under Basis. 2014 state tax forms Escrow accounts. 2014 state tax forms   Many monthly house payments include an amount placed in escrow (put in the care of a third party) for real estate taxes. 2014 state tax forms You may not be able to deduct the total you pay into the escrow account. 2014 state tax forms You can deduct only the real estate taxes that the lender actually paid from escrow to the taxing authority. 2014 state tax forms Your real estate tax bill will show this amount. 2014 state tax forms Refund or rebate of real estate taxes. 2014 state tax forms   If you receive a refund or rebate of real estate taxes this year for amounts you paid this year, you must reduce your real estate tax deduction by the amount refunded to you. 2014 state tax forms If the refund or rebate was for real estate taxes paid for a prior year, you may have to include some or all of the refund in your income. 2014 state tax forms For more information, see Recoveries in Publication 525, Taxable and Nontaxable Income. 2014 state tax forms Items You Cannot Deduct as Real Estate Taxes The following items are not deductible as real estate taxes. 2014 state tax forms Charges for services. 2014 state tax forms   An itemized charge for services to specific property or people is not a tax, even if the charge is paid to the taxing authority. 2014 state tax forms You cannot deduct the charge as a real estate tax if it is: A unit fee for the delivery of a service (such as a $5 fee charged for every 1,000 gallons of water you use), A periodic charge for a residential service (such as a $20 per month or $240 annual fee charged for trash collection), or A flat fee charged for a single service provided by your local government (such as a $30 charge for mowing your lawn because it had grown higher than permitted under a local ordinance). 2014 state tax forms    You must look at your real estate tax bill to decide if any nondeductible itemized charges, such as those listed above, are included in the bill. 2014 state tax forms If your taxing authority (or lender) does not furnish you a copy of your real estate tax bill, ask for it. 2014 state tax forms Contact the taxing authority if you need additional information about a specific charge on your real estate tax bill. 2014 state tax forms Assessments for local benefits. 2014 state tax forms   You cannot deduct amounts you pay for local benefits that tend to increase the value of your property. 2014 state tax forms Local benefits include the construction of streets, sidewalks, or water and sewer systems. 2014 state tax forms You must add these amounts to the basis of your property. 2014 state tax forms   You can, however, deduct assessments (or taxes) for local benefits if they are for maintenance, repair, or interest charges related to those benefits. 2014 state tax forms An example is a charge to repair an existing sidewalk and any interest included in that charge. 2014 state tax forms   If only a part of the assessment is for maintenance, repair, or interest charges, you must be able to show the amount of that part to claim the deduction. 2014 state tax forms If you cannot show what part of the assessment is for maintenance, repair, or interest charges, you cannot deduct any of it. 2014 state tax forms   An assessment for a local benefit may be listed as an item in your real estate tax bill. 2014 state tax forms If so, use the rules in this section to find how much of it, if any, you can deduct. 2014 state tax forms Transfer taxes (or stamp taxes). 2014 state tax forms   You cannot deduct transfer taxes and similar taxes and charges on the sale of a personal home. 2014 state tax forms If you are the buyer and you pay them, include them in the cost basis of the property. 2014 state tax forms If you are the seller and you pay them, they are expenses of the sale and reduce the amount realized on the sale. 2014 state tax forms Homeowners association assessments. 2014 state tax forms   You cannot deduct these assessments because the homeowners association, rather than a state or local government, imposes them. 2014 state tax forms Special Rules for Cooperatives If you own a cooperative apartment, some special rules apply to you, though you generally receive the same tax treatment as other homeowners. 2014 state tax forms As an owner of a cooperative apartment, you own shares of stock in a corporation that owns or leases housing facilities. 2014 state tax forms You can deduct your share of the corporation's deductible real estate taxes if the cooperative housing corporation meets the following conditions: The corporation has only one class of stock outstanding, Each stockholder, solely because of ownership of the stock, can live in a house, apartment, or house trailer owned or leased by the corporation, No stockholder can receive any distribution out of capital, except on a partial or complete liquidation of the corporation, and At least one of the following: At least 80% of the corporation's gross income for the tax year was paid by the tenant-stockholders. 2014 state tax forms For this purpose, gross income means all income received during the entire tax year, including any received before the corporation changed to cooperative ownership. 2014 state tax forms At least 80% of the total square footage of the corporation's property must be available for use by the tenant-stockholders during the entire tax year. 2014 state tax forms At least 90% of the expenditures paid or incurred by the corporation were used for the acquisition, construction, management, maintenance, or care of the property for the benefit of the tenant-shareholders during the entire tax year. 2014 state tax forms Tenant-stockholders. 2014 state tax forms   A tenant-stockholder can be any entity (such as a corporation, trust, estate, partnership, or association) as well as an individual. 2014 state tax forms The tenant-stockholder does not have to live in any of the cooperative's dwelling units. 2014 state tax forms The units that the tenant-stockholder has the right to occupy can be rented to others. 2014 state tax forms Deductible taxes. 2014 state tax forms   You figure your share of real estate taxes in the following way. 2014 state tax forms Divide the number of your shares of stock by the total number of shares outstanding, including any shares held by the corporation. 2014 state tax forms Multiply the corporation's deductible real estate taxes by the number you figured in (1). 2014 state tax forms This is your share of the real estate taxes. 2014 state tax forms   Generally, the corporation will tell you your share of its real estate tax. 2014 state tax forms This is the amount you can deduct if it reasonably reflects the cost of real estate taxes for your dwelling unit. 2014 state tax forms Refund of real estate taxes. 2014 state tax forms   If the corporation receives a refund of real estate taxes it paid in an earlier year, it must reduce the amount of real estate taxes paid this year when it allocates the tax expense to you. 2014 state tax forms Your deduction for real estate taxes the corporation paid this year is reduced by your share of the refund the corporation received. 2014 state tax forms Sales Taxes Generally, you can elect to deduct state and local general sales taxes instead of state and local income taxes as an itemized deduction on Schedule A (Form 1040). 2014 state tax forms Deductible sales taxes may include sales taxes paid on your home (including mobile and prefabricated), or home building materials if the tax rate was the same as the general sales tax rate. 2014 state tax forms For information on figuring your deduction, see the Instructions for Schedule A (Form 1040). 2014 state tax forms If you elect to deduct the sales taxes paid on your home, or home building materials, you cannot include them as part of your cost basis in the home. 2014 state tax forms Home Mortgage Interest This section of the publication gives you basic information about home mortgage interest, including information on interest paid at settlement, points, and Form 1098, Mortgage Interest Statement. 2014 state tax forms Most home buyers take out a mortgage (loan) to buy their home. 2014 state tax forms They then make monthly payments to either the mortgage holder or someone collecting the payments for the mortgage holder. 2014 state tax forms Usually, you can deduct the entire part of your payment that is for mortgage interest, if you itemize your deductions on Schedule A (Form 1040). 2014 state tax forms However, your deduction may be limited if: Your total mortgage balance is more than $1 million ($500,000 if married filing separately), or You took out a mortgage for reasons other than to buy, build, or improve your home. 2014 state tax forms If either of these situations applies to you, see Publication 936 for more information. 2014 state tax forms Also see Publication 936 if you later refinance your mortgage or buy a second home. 2014 state tax forms Refund of home mortgage interest. 2014 state tax forms   If you receive a refund of home mortgage interest that you deducted in an earlier year and that reduced your tax, you generally must include the refund in income in the year you receive it. 2014 state tax forms For more information, see Recoveries in Publication 525. 2014 state tax forms The amount of the refund will usually be shown on the mortgage interest statement you receive from your mortgage lender. 2014 state tax forms See Mortgage Interest Statement , later. 2014 state tax forms Deductible Mortgage Interest To be deductible, the interest you pay must be on a loan secured by your main home or a second home. 2014 state tax forms The loan can be a first or second mortgage, a home improvement loan, or a home equity loan. 2014 state tax forms Prepaid interest. 2014 state tax forms   If you pay interest in advance for a period that goes beyond the end of the tax year, you must spread this interest over the tax years to which it applies. 2014 state tax forms Generally, you can deduct in each year only the interest that qualifies as home mortgage interest for that year. 2014 state tax forms An exception (discussed later) applies to points. 2014 state tax forms Late payment charge on mortgage payment. 2014 state tax forms   You can deduct as home mortgage interest a late payment charge if it was not for a specific service in connection with your mortgage loan. 2014 state tax forms Mortgage prepayment penalty. 2014 state tax forms   If you pay off your home mortgage early, you may have to pay a penalty. 2014 state tax forms You can deduct that penalty as home mortgage interest provided the penalty is not for a specific service performed or cost incurred in connection with your mortgage loan. 2014 state tax forms Ground rent. 2014 state tax forms   In some states (such as Maryland), you may buy your home subject to a ground rent. 2014 state tax forms A ground rent is an obligation you assume to pay a fixed amount per year on the property. 2014 state tax forms Under this arrangement, you are leasing (rather than buying) the land on which your home is located. 2014 state tax forms Redeemable ground rents. 2014 state tax forms   If you make annual or periodic rental payments on a redeemable ground rent, you can deduct the payments as mortgage interest. 2014 state tax forms The ground rent is a redeemable ground rent only if all of the following are true. 2014 state tax forms Your lease, including renewal periods, is for more than 15 years. 2014 state tax forms You can freely assign the lease. 2014 state tax forms You have a present or future right (under state or local law) to end the lease and buy the lessor's entire interest in the land by paying a specified amount. 2014 state tax forms The lessor's interest in the land is primarily a security interest to protect the rental payments to which he or she is entitled. 2014 state tax forms   Payments made to end the lease and buy the lessor's entire interest in the land are not redeemable ground rents. 2014 state tax forms You cannot deduct them. 2014 state tax forms Nonredeemable ground rents. 2014 state tax forms   Payments on a nonredeemable ground rent are not mortgage interest. 2014 state tax forms You can deduct them as rent only if they are a business expense or if they are for rental property. 2014 state tax forms Cooperative apartment. 2014 state tax forms   You can usually treat the interest on a loan you took out to buy stock in a cooperative housing corporation as home mortgage interest if you own a cooperative apartment, and the cooperative housing corporation meets the conditions described earlier under Special Rules for Cooperatives . 2014 state tax forms In addition, you can treat as home mortgage interest your share of the corporation's deductible mortgage interest. 2014 state tax forms Figure your share of mortgage interest the same way that is shown for figuring your share of real estate taxes in the Example under Division of real estate taxes, earlier. 2014 state tax forms For more information on cooperatives, see Special Rule for Tenant-Stockholders in Cooperative Housing Corporations in Publication 936. 2014 state tax forms Refund of cooperative's mortgage interest. 2014 state tax forms   You must reduce your mortgage interest deduction by your share of any cash portion of a patronage dividend that the cooperative receives. 2014 state tax forms The patronage dividend is a partial refund to the cooperative housing corporation of mortgage interest it paid in a prior year. 2014 state tax forms   If you receive a Form 1098 from the cooperative housing corporation, the form should show only the amount you can deduct. 2014 state tax forms Mortgage Interest Paid at Settlement One item that normally appears on a settlement or closing statement is home mortgage interest. 2014 state tax forms You can deduct the interest that you pay at settlement if you itemize your deductions on Schedule A (Form 1040). 2014 state tax forms This amount should be included in the mortgage interest statement provided by your lender. 2014 state tax forms See the discussion under Mortgage Interest Statement , later. 2014 state tax forms Also, if you pay interest in advance, see Prepaid interest , earlier, and Points , next. 2014 state tax forms Points The term “points” is used to describe certain charges paid, or treated as paid, by a borrower to obtain a home mortgage. 2014 state tax forms Points also may be called loan origination fees, maximum loan charges, loan discount, or discount points. 2014 state tax forms A borrower is treated as paying any points that a home seller pays for the borrower's mortgage. 2014 state tax forms See Points paid by the seller , later. 2014 state tax forms General rule. 2014 state tax forms   You cannot deduct the full amount of points in the year paid. 2014 state tax forms They are prepaid interest, so you generally must deduct them over the life (term) of the mortgage. 2014 state tax forms Exception. 2014 state tax forms   You can deduct the full amount of points in the year paid if you meet all the following tests. 2014 state tax forms Your loan is secured by your main home. 2014 state tax forms (Generally, your main home is the one you live in most of the time. 2014 state tax forms ) Paying points is an established business practice in the area where the loan was made. 2014 state tax forms The points paid were not more than the points generally charged in that area. 2014 state tax forms You use the cash method of accounting. 2014 state tax forms This means you report income in the year you receive it and deduct expenses in the year you pay them. 2014 state tax forms Most individuals use this method. 2014 state tax forms The points were not paid in place of amounts that ordinarily are stated separately on the settlement statement, such as appraisal fees, inspection fees, title fees, attorney fees, and property taxes. 2014 state tax forms The funds you provided at or before closing, plus any points the seller paid, were at least as much as the points charged. 2014 state tax forms The funds you provided are not required to have been applied to the points. 2014 state tax forms They can include a down payment, an escrow deposit, earnest money, and other funds you paid at or before closing for any purpose. 2014 state tax forms You cannot have borrowed these funds. 2014 state tax forms You use your loan to buy or build your main home. 2014 state tax forms The points were computed as a percentage of the principal amount of the mortgage. 2014 state tax forms The amount is clearly shown on the settlement statement (such as the Uniform Settlement Statement, Form HUD-1) as points charged for the mortgage. 2014 state tax forms The points may be shown as paid from either your funds or the seller's. 2014 state tax forms Note. 2014 state tax forms If you meet all of the tests listed above and you itemize your deductions in the year you get the loan, you can either deduct the full amount of points in the year paid or deduct them over the life of the loan, beginning in the year you get the loan. 2014 state tax forms If you do not itemize your deductions in the year you get the loan, you can spread the points over the life of the loan and deduct the appropriate amount in each future year, if any, when you do itemize your deductions. 2014 state tax forms Home improvement loan. 2014 state tax forms   You can also fully deduct in the year paid points paid on a loan to improve your main home, if you meet the first six tests listed earlier. 2014 state tax forms Refinanced loan. 2014 state tax forms   If you use part of the refinanced mortgage proceeds to improve your main home and you meet the first six tests listed earlier, you can fully deduct the part of the points related to the improvement in the year you paid them with your own funds. 2014 state tax forms You can deduct the rest of the points over the life of the loan. 2014 state tax forms Points not fully deductible in year paid. 2014 state tax forms    If you do not qualify under the exception to deduct the full amount of points in the year paid (or choose not to do so), see Points in Publication 936 for the rules on when and how much you can deduct. 2014 state tax forms Figure A. 2014 state tax forms   You can use Figure A, next, as a quick guide to see whether your points are fully deductible in the year paid. 2014 state tax forms    Please click here for the text description of the image. 2014 state tax forms Figure A. 2014 state tax forms Are my points fully deductible this year? Amounts charged for services. 2014 state tax forms   Amounts charged by the lender for specific services connected to the loan are not interest. 2014 state tax forms Examples of these charges are: Appraisal fees, Notary fees, and Preparation costs for the mortgage note or deed of trust. 2014 state tax forms You cannot deduct these amounts as points either in the year paid or over the life of the mortgage. 2014 state tax forms For information about the tax treatment of these amounts and other settlement fees and closing costs, see Basis , later. 2014 state tax forms Points paid by the seller. 2014 state tax forms   The term “points” includes loan placement fees that the seller pays to the lender to arrange financing for the buyer. 2014 state tax forms Treatment by seller. 2014 state tax forms   The seller cannot deduct these fees as interest. 2014 state tax forms However, they are a selling expense that reduces the seller's amount realized. 2014 state tax forms See Publication 523 for more information. 2014 state tax forms Treatment by buyer. 2014 state tax forms   The buyer treats seller-paid points as if he or she had paid them. 2014 state tax forms If all the tests listed earlier under Exception are met, the buyer can deduct the points in the year paid. 2014 state tax forms If any of those tests are not met, the buyer must deduct the points over the life of the loan. 2014 state tax forms   The buyer must also reduce the basis of the home by the amount of the seller-paid points. 2014 state tax forms For more information about the basis of your home, see Basis , later. 2014 state tax forms Funds provided are less than points. 2014 state tax forms   If you meet all the tests listed earlier under Exception except that the funds you provided were less than the points charged to you (test 6), you can deduct the points in the year paid up to the amount of funds you provided. 2014 state tax forms In addition, you can deduct any points paid by the seller. 2014 state tax forms Example 1. 2014 state tax forms When you took out a $100,000 mortgage loan to buy your home in December, you were charged one point ($1,000). 2014 state tax forms You meet all the tests for deducting points in the year paid (see Exception , earlier), except the only funds you provided were a $750 down payment. 2014 state tax forms Of the $1,000 you were charged for points, you can deduct $750 in the year paid. 2014 state tax forms You spread the remaining $250 over the life of the mortgage. 2014 state tax forms Example 2. 2014 state tax forms The facts are the same as in Example 1 , except that the person who sold you your home also paid one point ($1,000) to help you get your mortgage. 2014 state tax forms In the year paid, you can deduct $1,750 ($750 of the amount you were charged plus the $1,000 paid by the seller). 2014 state tax forms You spread the remaining $250 over the life of the mortgage. 2014 state tax forms You must reduce the basis of your home by the $1,000 paid by the seller. 2014 state tax forms Excess points. 2014 state tax forms   If you meet all the tests under Exception , earlier, except that the points paid were more than are generally charged in your area (test 3), you can deduct in the year paid only the points that are generally charged. 2014 state tax forms You must spread any additional points over the life of the mortgage. 2014 state tax forms Mortgage ending early. 2014 state tax forms   If you spread your deduction for points over the life of the mortgage, you can deduct any remaining balance in the year the mortgage ends. 2014 state tax forms A mortgage may end early due to a prepayment, refinancing, foreclosure, or similar event. 2014 state tax forms Example. 2014 state tax forms Dan paid $3,000 in points in 2006 that he had to spread out over the 15-year life of the mortgage. 2014 state tax forms He had deducted $1,400 of these points through 2012. 2014 state tax forms Dan prepaid his mortgage in full in 2013. 2014 state tax forms He can deduct the remaining $1,600 of points in 2013. 2014 state tax forms Exception. 2014 state tax forms   If you refinance the mortgage with the same lender, you cannot deduct any remaining points for the year. 2014 state tax forms Instead, deduct them over the term of the new loan. 2014 state tax forms Form 1098. 2014 state tax forms   The mortgage interest statement you receive should show not only the total interest paid during the year, but also your deductible points paid during the year. 2014 state tax forms See Mortgage Interest Statement , later. 2014 state tax forms Where To Deduct Home Mortgage Interest Enter on Schedule A (Form 1040), line 10, the home mortgage interest and points reported to you on Form 1098 (discussed next). 2014 state tax forms If you did not receive a Form 1098, enter your deductible interest on line 11, and any deductible points on line 12. 2014 state tax forms See Table 1 below for a summary of where to deduct home mortgage interest and real estate taxes. 2014 state tax forms If you paid home mortgage interest to the person from whom you bought your home, show that person's name, address, and social security number (SSN) or employer identification number (EIN) on the dotted lines next to line 11. 2014 state tax forms The seller must give you this number and you must give the seller your SSN. 2014 state tax forms Form W-9, Request for Taxpayer Identification Number and Certification, can be used for this purpose. 2014 state tax forms Failure to meet either of these requirements may result in a $50 penalty for each failure. 2014 state tax forms Table 1. 2014 state tax forms Where To Deduct Interest and Taxes Paid on Your Home See the text for information on what expenses are eligible. 2014 state tax forms IF you are eligible to deduct . 2014 state tax forms . 2014 state tax forms . 2014 state tax forms THEN report the amount  on Schedule A (Form 1040) . 2014 state tax forms . 2014 state tax forms . 2014 state tax forms real estate taxes line 6. 2014 state tax forms home mortgage interest and points reported on Form 1098 line 10. 2014 state tax forms home mortgage interest not reported on  Form 1098 line 11. 2014 state tax forms points not reported on Form 1098 line 12. 2014 state tax forms qualified mortgage insurance premiums line 13. 2014 state tax forms Mortgage Interest Statement If you paid $600 or more of mortgage interest (including certain points and mortgage insurance premiums) during the year on any one mortgage to a mortgage holder in the course of that holder's trade or business, you should receive a Form 1098 or similar statement from the mortgage holder. 2014 state tax forms The statement will show the total interest paid on your mortgage during the year. 2014 state tax forms If you bought a main home during the year, it also will show the deductible points you paid and any points you can deduct that were paid by the person who sold you your home. 2014 state tax forms See Points , earlier. 2014 state tax forms The interest you paid at settlement should be included on the statement. 2014 state tax forms If it is not, add the interest from the settlement sheet that qualifies as home mortgage interest to the total shown on Form 1098 or similar statement. 2014 state tax forms Put the total on Schedule A (Form 1040), line 10, and attach a statement to your return explaining the difference. 2014 state tax forms Write “See attached” to the right of line 10. 2014 state tax forms A mortgage holder can be a financial institution, a governmental unit, or a cooperative housing corporation. 2014 state tax forms If a statement comes from a cooperative housing corporation, it generally will show your share of interest. 2014 state tax forms Your mortgage interest statement for 2013 should be provided or sent to you by January 31, 2014. 2014 state tax forms If it is mailed, you should allow adequate time to receive it before contacting the mortgage holder. 2014 state tax forms A copy of this form will be sent to the IRS also. 2014 state tax forms Example. 2014 state tax forms You bought a new home on May 3. 2014 state tax forms You paid no points on the purchase. 2014 state tax forms During the year, you made mortgage payments which included $4,480 deductible interest on your new home. 2014 state tax forms The settlement sheet for the purchase of the home included interest of $620 for 29 days in May. 2014 state tax forms The mortgage statement you receive from the lender includes total interest of $5,100 ($4,480 + $620). 2014 state tax forms You can deduct the $5,100 if you itemize your deductions. 2014 state tax forms Refund of overpaid interest. 2014 state tax forms   If you receive a refund of mortgage interest you overpaid in a prior year, you generally will receive a Form 1098 showing the refund in box 3. 2014 state tax forms Generally, you must include the refund in income in the year you receive it. 2014 state tax forms See Refund of home mortgage interest , earlier, under Home Mortgage Interest. 2014 state tax forms More than one borrower. 2014 state tax forms   If you and at least one other person (other than your spouse if you file a joint return) were liable for and paid interest on a mortgage that was for your home, and the other person received a Form 1098 showing the interest that was paid during the year, attach a statement to your return explaining this. 2014 state tax forms Show how much of the interest each of you paid, and give the name and address of the person who received the form. 2014 state tax forms Deduct your share of the interest on Schedule A (Form 1040), line 11, and write “See attached” to the right of that line. 2014 state tax forms Mortgage Insurance Premiums You may be able to take an itemized deduction on Schedule A (Form 1040), line 13, for premiums you pay or accrue during 2013 for qualified mortgage insurance in connection with home acquisition debt on your qualified home. 2014 state tax forms Mortgage insurance premiums you paid or accrued on any mortgage insurance contract issued before January 1, 2007, are not deductible as an itemized deduction. 2014 state tax forms Qualified Mortgage Insurance Qualified mortgage insurance is mortgage insurance provided by the Veterans Administration, the Federal Housing Administration, or the Rural Housing Administration, and private mortgage insurance (as defined in section 2 of the Homeowners Protection Act of 1998 as in effect on December 20, 2006). 2014 state tax forms Prepaid mortgage insurance premiums. 2014 state tax forms   If you paid premiums that are allocable to periods after 2013, you must allocate them over the shorter of: The stated term of the mortgage, or 84 months, beginning with the month the insurance was obtained. 2014 state tax forms The premiums are treated as paid in the year to which they were allocated. 2014 state tax forms If the mortgage is satisfied before its term, no deduction is allowed for the unamortized balance. 2014 state tax forms See Publication 936 for details. 2014 state tax forms Exception for certain mortgage insurance. 2014 state tax forms   The allocation rules, explained above, do not apply to qualified mortgage insurance provided by the Department of Veterans Affairs or Rural Housing Service. 2014 state tax forms Home Acquisition Debt Home acquisition debt is a mortgage you took out after October 13, 1987, to buy, build, or substantially improve a qualified home. 2014 state tax forms It also must be secured by that home. 2014 state tax forms If the amount of your mortgage is more than the cost of the home plus the cost of any substantial improvements, only the debt that is not more than the cost of the home plus improvements qualifies as home acquisition debt. 2014 state tax forms Home acquisition debt limit. 2014 state tax forms   The total amount you can treat as home acquisition debt at any time on your home cannot be more than $1 million ($500,000 if married filing separately). 2014 state tax forms Discharges of qualified principal residence indebtedness. 2014 state tax forms   You can exclude from gross income any discharges of qualified principal residence indebtedness made after 2006 and before 2014. 2014 state tax forms You must reduce the basis of your principal residence (but not below zero) by the amount you exclude. 2014 state tax forms Principal residence. 2014 state tax forms   Your principal residence is the home where you ordinarily live most of the time. 2014 state tax forms You can have only one principal residence at any one time. 2014 state tax forms Qualified principal residence indebtedness. 2014 state tax forms   This is a mortgage that you took out to buy, build, or substantially improve your principal residence and that is secured by that residence. 2014 state tax forms If the amount of your original mortgage is more than the cost of your principal residence plus the cost of substantial improvements, qualified principal residence indebtedness cannot be more than the cost of your principal residence plus improvements. 2014 state tax forms   Any debt secured by your principal residence that you use to refinance qualified principal residence indebtedness is qualified principal residence indebtedness up to the amount of your old mortgage principal just before the refinancing. 2014 state tax forms Additional debt incurred to substantially improve your principal residence is also qualified principal residence indebtedness. 2014 state tax forms Amount you can exclude. 2014 state tax forms   You can only exclude debt discharged after 2006 and before 2014. 2014 state tax forms The most you can exclude is $2 million ($1 million if married filing separately). 2014 state tax forms You cannot exclude any amount that was discharged because of services performed for the lender or on account of any other factor not directly related either to a decline in the value of your residence or to your financial condition. 2014 state tax forms Ordering rule. 2014 state tax forms   If only a part of a loan is qualified principal residence indebtedness, you can exclude only the amount of the discharge that is more than the amount of the loan (immediately before the discharge) that is not qualified principal residence indebtedness. 2014 state tax forms Qualified Home This means your main home or your second home. 2014 state tax forms A home includes a house, condominium, cooperative, mobile home, house trailer, boat, or similar property that has sleeping, cooking, and toilet facilities. 2014 state tax forms Main home. 2014 state tax forms   You can have only one main home at any one time. 2014 state tax forms This is the home where you ordinarily live most of the time. 2014 state tax forms Second home and other special situations. 2014 state tax forms   If you have a second home, use part of your home for other than residential living (such as a home office), rent out part of your home, or are having your home constructed, see Qualified Home in Publication 936. 2014 state tax forms Limit on Deduction If your adjusted gross income (AGI) on Form 1040, line 38, is more than $100,000 ($50,000 if your filing status is married filing separately), the amount of your mortgage insurance premiums that are deductible is reduced and may be eliminated. 2014 state tax forms See Line 13 in the instructions for Schedule A (Form 1040) and complete the Mortgage Insurance Premiums Deduction Worksheet to figure the amount you can deduct. 2014 state tax forms If your AGI is more than $109,000 ($54,500 if married filing separately), you cannot deduct your mortgage insurance premiums. 2014 state tax forms Form 1098. 2014 state tax forms   The amount of mortgage insurance premiums you paid during 2013 should be reported in box 4. 2014 state tax forms See Form 1098, Mortgage Interest Statement in Publication 936. 2014 state tax forms Mortgage Interest Credit The mortgage interest credit is intended to help lower-income individuals afford home ownership. 2014 state tax forms If you qualify, you can claim the credit on Form 8396 each year for part of the home mortgage interest you pay. 2014 state tax forms Who qualifies. 2014 state tax forms   You may be eligible for the credit if you were issued a qualified Mortgage Credit Certificate (MCC) from your state or local government. 2014 state tax forms Generally, an MCC is issued only in connection with a new mortgage for the purchase of your main home. 2014 state tax forms The MCC will show the certificate credit rate you will use to figure your credit. 2014 state tax forms It also will show the certified indebtedness amount. 2014 state tax forms Only the interest on that amount qualifies for the credit. 2014 state tax forms See Figuring the Credit , later. 2014 state tax forms You must contact the appropriate government agency about getting an MCC before you get a mortgage and buy your home. 2014 state tax forms Contact your state or local housing finance agency for information about the availability of MCCs in your area. 2014 state tax forms How to claim the credit. 2014 state tax forms   To claim the credit, complete Form 8396 and attach it to your Form 1040 or Form 1040NR, U. 2014 state tax forms S. 2014 state tax forms Nonresident Alien Income Tax Return. 2014 state tax forms Include the credit in your total for Form 1040, line 53, or Form 1040NR, line 50; be sure to check box c and write “Form 8396” on that line. 2014 state tax forms Reducing your home mortgage interest deduction. 2014 state tax forms   If you itemize your deductions on Schedule A (Form 1040), you must reduce your home mortgage interest deduction by the amount of the mortgage interest credit shown on Form 8396, line 3. 2014 state tax forms You must do this even if part of that amount is to be carried forward to 2014. 2014 state tax forms Selling your home. 2014 state tax forms   If you purchase a home after 1990 using an MCC, and you sell that home within 9 years, you may have to recapture (repay) all or part of the benefit you received from the MCC program. 2014 state tax forms For additional information, see Recapturing (Paying Back) a Federal Mortgage Subsidy, in Publication 523. 2014 state tax forms Figuring the Credit Figure your credit on Form 8396. 2014 state tax forms Mortgage not more than certified indebtedness. 2014 state tax forms   If your mortgage loan amount is equal to (or smaller than) the certified indebtedness amount shown on your MCC, enter on Form 8396, line 1, all the interest you paid on your mortgage during the year. 2014 state tax forms Mortgage more than certified indebtedness. 2014 state tax forms   If your mortgage loan amount is larger than the certified indebtedness amount shown on your MCC, you can figure the credit on only part of the interest you paid. 2014 state tax forms To find the amount to enter on line 1, multiply the total interest you paid during the year on your mortgage by the following fraction. 2014 state tax forms Certified indebtedness amount on your MCC Original amount of your mortgage   The fraction will not change as long as you are entitled to take the mortgage interest credit. 2014 state tax forms Example. 2014 state tax forms Emily bought a home this year. 2014 state tax forms Her mortgage loan is $125,000. 2014 state tax forms The certified indebtedness amount on her MCC is $100,000. 2014 state tax forms She paid $7,500 interest this year. 2014 state tax forms Emily figures the interest to enter on Form 8396, line 1, as follows:   $100,000 = 80% (. 2014 state tax forms 80)       $125,000       $7,500 x . 2014 state tax forms 80 = $6,000   Emily enters $6,000 on Form 8396, line 1. 2014 state tax forms In each later year, she will figure her credit using only 80% of the interest she pays for that year. 2014 state tax forms Limits Two limits may apply to your credit. 2014 state tax forms A limit based on the credit rate, and A limit based on your tax. 2014 state tax forms Limit based on credit rate. 2014 state tax forms   If the certificate credit rate is higher than 20%, the credit you are allowed cannot be more than $2,000. 2014 state tax forms Limit based on tax. 2014 state tax forms   After applying the limit based on the credit rate, your credit generally cannot be more than your tax liability. 2014 state tax forms See the Credit Limit Worksheet in the Form 8396 instructions to calculate the limit based on tax. 2014 state tax forms Dividing the Credit If two or more persons (other than a married couple filing a joint return) hold an interest in the home to which the MCC relates, the credit must be divided based on the interest held by each person. 2014 state tax forms Example. 2014 state tax forms John and his brother, George, were issued an MCC. 2014 state tax forms They used it to get a mortgage on their main home. 2014 state tax forms John has a 60% ownership interest in the home, and George has a 40% ownership interest in the home. 2014 state tax forms John paid $5,400 mortgage interest this year and George paid $3,600. 2014 state tax forms The MCC shows a credit rate of 25% and a certified indebtedness amount of $130,000. 2014 state tax forms The loan amount (mortgage) on their home is $120,000. 2014 state tax forms The credit is limited to $2,000 because the credit rate is more than 20%. 2014 state tax forms John figures the credit by multiplying the mortgage interest he paid this year ($5,400) by the certificate credit rate (25%) for a total of $1,350. 2014 state tax forms His credit is limited to $1,200 ($2,000 × 60%). 2014 state tax forms George figures the credit by multiplying the mortgage interest he paid this year ($3,600) by the certificate credit rate (25%) for a total of $900. 2014 state tax forms His credit is limited to $800 ($2,000 × 40%). 2014 state tax forms Carryforward If your allowable credit is reduced because of the limit based on your tax, you can carry forward the unused portion of the credit to the next 3 years or until used, whichever comes first. 2014 state tax forms Example. 2014 state tax forms You receive a mortgage credit certificate from State X. 2014 state tax forms This year, your regular tax liability is $1,100, you owe no alternative minimum tax, and your mortgage interest credit is $1,700. 2014 state tax forms You claim no other credits. 2014 state tax forms Your unused mortgage interest credit for this year is $600 ($1,700 − $1,100). 2014 state tax forms You can carry forward this amount to the next 3 years or until used, whichever comes first. 2014 state tax forms Credit rate more than 20%. 2014 state tax forms   If you are subject to the $2,000 limit because your certificate credit rate is more than 20%, you cannot carry forward any amount more than $2,000 (or your share of the $2,000 if you must divide the credit). 2014 state tax forms Example. 2014 state tax forms In the earlier example under Dividing the Credit , John and George used the entire $2,000 credit. 2014 state tax forms The excess   John $1,350 − $1,200 = $150     George $900 − $800 = $100   $150 for John ($1,350 − $1,200) and $100 for George ($900 − $800) cannot be carried forward to future years, despite the respective tax liabilities for John and George. 2014 state tax forms Refinancing If you refinance your original mortgage loan on which you had been given an MCC, you must get a new MCC to be able to claim the credit on the new loan. 2014 state tax forms The amount of credit you can claim on the new loan may change. 2014 state tax forms Table 2 below summarizes how to figure your credit if you refinance your original mortgage loan. 2014 state tax forms Table 2. 2014 state tax forms Effect of Refinancing on Your Credit IF you get a new (reissued) MCC and the amount of your new mortgage is . 2014 state tax forms . 2014 state tax forms . 2014 state tax forms THEN the interest you claim on Form 8396, line 1, is* . 2014 state tax forms . 2014 state tax forms . 2014 state tax forms smaller than or equal to the certified indebtedness amount on the new MCC all the interest paid during the year on your new mortgage. 2014 state tax forms larger than the certified indebtedness amount on the new MCC interest paid during the year on your new mortgage multiplied by the following fraction. 2014 state tax forms         certified indebtedness  amount on your new MCC       original amount of your  mortgage   *The credit using the new MCC cannot be more than the credit using the old MCC. 2014 state tax forms  See New MCC cannot increase your credit above. 2014 state tax forms An issuer may reissue an MCC after you refinance your mortgage. 2014 state tax forms If you did not get a new MCC, you may want to contact the state or local housing finance agency that issued your original MCC for information about whether you can get a reissued MCC. 2014 state tax forms Year of refinancing. 2014 state tax forms   In the year of refinancing, add the applicable amount of interest paid on the old mortgage and the applicable amount of interest paid on the new mortgage, and enter the total on Form 8396, line 1. 2014 state tax forms   If your new MCC has a credit rate different from the rate on the old MCC, you must attach a statement to Form 8396. 2014 state tax forms The statement must show the calculation for lines 1, 2, and 3 for the part of the year when the old MCC was in effect. 2014 state tax forms It must show a separate calculation for the part of the year when the new MCC was in effect. 2014 state tax forms Combine the amounts from both calculations for line 3, enter the total on line 3 of the form, and write “See attached” on the dotted line next to line 2. 2014 state tax forms New MCC cannot increase your credit. 2014 state tax forms   The credit that you claim with your new MCC cannot be more than the credit that you could have claimed with your old MCC. 2014 state tax forms   In most cases, the agency that issues your new MCC will make sure that it does not increase your credit. 2014 state tax forms However, if either your old loan or your new loan has a variable (adjustable) interest rate, you will need to check this yourself. 2014 state tax forms In that case, you will need to know the amount of the credit you could have claimed using the old MCC. 2014 state tax forms   There are two methods for figuring the credit you could have claimed. 2014 state tax forms Under one method, you figure the actual credit that would have been allowed. 2014 state tax forms This means you use the credit rate on the old MCC and the interest you would have paid on the old loan. 2014 state tax forms   If your old loan was a variable rate mortgage, you can use another method to determine the credit that you could have claimed. 2014 state tax forms Under this method, you figure the credit using a payment schedule of a hypothetical self-amortizing mortgage with level payments projected to the final maturity date of the old mortgage. 2014 state tax forms The interest rate of the hypothetical mortgage is the annual percentage rate (APR) of the new mortgage for purposes of the Federal Truth in Lending Act. 2014 state tax forms The principal of the hypothetical mortgage is the remaining outstanding balance of the certified mortgage indebtedness shown on the old MCC. 2014 state tax forms    You must choose one method and use it consistently beginning with the first tax year for which you claim the credit based on the new MCC. 2014 state tax forms    As part of your tax records, you should keep your old MCC and the schedule of payments for your old mortgage. 2014 state tax forms Basis Basis is your starting point for figuring a gain or loss if you later sell your home, or for figuring depreciation if you later use part of your home for business purposes or for rent. 2014 state tax forms While you own your home, you may add certain items to your basis. 2014 state tax forms You may subtract certain other items from your basis. 2014 state tax forms These items are called adjustments to basis and are explained later under Adjusted Basis . 2014 state tax forms It is important that you understand these terms when you first acquire your home because you must keep track of your basis and adjusted basis during the period you own your home. 2014 state tax forms You also must keep records of the events that affect basis or adjusted basis. 2014 state tax forms See Keeping Records , below. 2014 state tax forms Figuring Your Basis How you figure your basis depends on how you acquire your home. 2014 state tax forms If you buy or build your home, your cost is your basis. 2014 state tax forms If you receive your home as a gift, your basis is usually the same as the adjusted basis of the person who gave you the property. 2014 state tax forms If you inherit your home from a decedent, different rules apply depending on the date of the decedent's death. 2014 state tax forms Each of these topics is discussed later. 2014 state tax forms Property transferred from a spouse. 2014 state tax forms   If your home is transferred to you from your spouse, or from your former spouse as a result of a divorce, your basis is the same as your spouse's (or former spouse's) adjusted basis just before the transfer. 2014 state tax forms Publication 504, Divorced or Separated Individuals, fully discusses transfers between spouses. 2014 state tax forms Cost as Basis The cost of your home, whether you purchased it or constructed it, is the amount you paid for it, including any debt you assumed. 2014 state tax forms The cost of your home includes most settlement or closing costs you paid when you bought the home. 2014 state tax forms If you built your home, your cost includes most closing costs paid when you bought the land or settled on your mortgage. 2014 state tax forms See Settlement or closing costs , later. 2014 state tax forms If you elect to deduct the sales taxes on the purchase or construction of your home as an itemized deduction on Schedule A (Form 1040), you cannot include the sales taxes as part of your cost basis in the home. 2014 state tax forms Purchase. 2014 state tax forms   The basis of a home you bought is the amount you paid for it. 2014 state tax forms This usually includes your down payment and any debt you assumed. 2014 state tax forms The basis of a cooperative apartment is the amount you paid for your shares in the corporation that owns or controls the property. 2014 state tax forms This amount includes any purchase commissions or other costs of acquiring the shares. 2014 state tax forms Construction. 2014 state tax forms   If you contracted to have your home built on land that you own, your basis in the home is your basis in the land plus the amount you paid to have the home built. 2014 state tax forms This includes the cost of labor and materials, the amount you paid the contractor, any architect's fees, building permit charges, utility meter and connection charges, and legal fees that are directly connected with building your home. 2014 state tax forms If you built all or part of your home yourself, your basis is the total amount it cost you to build it. 2014 state tax forms You cannot include in basis the value of your own labor or any other labor for which you did not pay. 2014 state tax forms Real estate taxes. 2014 state tax forms   Real estate taxes are usually divided so that you and the seller each pay taxes for the part of the property tax year that each owned the home. 2014 state tax forms See the earlier discussion of Real estate taxes paid at settlement or closing , under Real Estate Taxes, earlier, to figure the real estate taxes you paid or are considered to have paid. 2014 state tax forms   If you pay any part of the seller's share of the real estate taxes (the taxes up to the date of sale), and the seller did not reimburse you, add those taxes to your basis in the home. 2014 state tax forms You cannot deduct them as taxes paid. 2014 state tax forms   If the seller paid any of your share of the real estate taxes (the taxes beginning with the date of sale), you can still deduct those taxes. 2014 state tax forms Do not include those taxes in your basis. 2014 state tax forms If you did not reimburse the seller, you must reduce your basis by the amount of those taxes. 2014 state tax forms Example 1. 2014 state tax forms You bought your home on September 1. 2014 state tax forms The property tax year in your area is the calendar year, and the tax is due on August 15. 2014 state tax forms The real estate taxes on the home you bought were $1,275 for the year and had been paid by the seller on August 15. 2014 state tax forms You did not reimburse the seller for your share of the real estate taxes from September 1 through December 31. 2014 state tax forms You must reduce the basis of your home by the $426 [(122 ÷ 365) × $1,275] the seller paid for you. 2014 state tax forms You can deduct your $426 share of real estate taxes on your return for the year you purchased your home. 2014 state tax forms Example 2. 2014 state tax forms You bought your home on May 3, 2013. 2014 state tax forms The property tax year in your area is the calendar year. 2014 state tax forms The taxes for the previous year are assessed on January 2 and are due on May 31 and November 30. 2014 state tax forms Under state law, the taxes become a lien on May 31. 2014 state tax forms You agreed to pay all taxes due after the date of sale. 2014 state tax forms The taxes due in 2013 for 2012 were $1,375. 2014 state tax forms The taxes due in 2014 for 2013 will be $1,425. 2014 state tax forms You cannot deduct any of the taxes paid in 2013 because they relate to the 2012 property tax year and you did not own the home until 2013. 2014 state tax forms Instead, you add the $1,375 to the cost (basis) of your home. 2014 state tax forms You owned the home in 2013 for 243 days (May 3 to December 31), so you can take a tax deduction on your 2014 return of $949 [(243 ÷ 365) × $1,425] paid in 2014 for 2013. 2014 state tax forms You add the remaining $476 ($1,425 − $949) of taxes paid in 2014 to the cost (basis) of your home. 2014 state tax forms Settlement or closing costs. 2014 state tax forms   If you bought your home, you probably paid settlement or closing costs in addition to the contract price. 2014 state tax forms These costs are divided between you and the seller according to the sales contract, local custom, or understanding of the parties. 2014 state tax forms If you built your home, you probably paid these costs when you bought the land or settled on your mortgage. 2014 state tax forms   The only settlement or closing costs you can deduct are home mortgage interest and certain real estate taxes. 2014 state tax forms You deduct them in the year you buy your home if you itemize your deductions. 2014 state tax forms You can add certain other settlement or closing costs to the basis of your home. 2014 state tax forms Items added to basis. 2014 state tax forms   You can include in your basis the settlement fees and closing costs you paid for buying your home. 2014 state tax forms A fee is for buying the home if you would have had to pay it even if you paid cash for the home. 2014 state tax forms   The following are some of the settlement fees and closing costs that you can include in the original basis of your home. 2014 state tax forms Abstract fees (abstract of title fees). 2014 state tax forms Charges for installing utility services. 2014 state tax forms Legal fees (including fees for the title search and preparation of the sales contract and deed). 2014 state tax forms Recording fees. 2014 state tax forms Surveys. 2014 state tax forms Transfer or stamp taxes. 2014 state tax forms Owner's title insurance. 2014 state tax forms Any amount the seller owes that you agree to pay, such as back taxes or interest, recording or mortgage fees, cost for improvements or repairs, and sales commissions. 2014 state tax forms   If the seller actually paid for any item for which you are liable and for which you can take a deduction (such as your share of the real estate taxes for the year of sale), you must reduce your basis by that amount unless you are charged for it in the settlement. 2014 state tax forms Items not added to basis and not deductible. 2014 state tax forms   Here are some settlement and closing costs that you cannot deduct or add to your basis. 2014 state tax forms Fire insurance premiums. 2014 state tax forms Charges for using utilities or other services related to occupancy of the home before closing. 2014 state tax forms Rent for occupying the home before closing. 2014 state tax forms Charges connected with getting or refinancing a mortgage loan, such as: Loan assumption fees, Cost of a credit report, and Fee for an appraisal required by a lender. 2014 state tax forms Points paid by seller. 2014 state tax forms   If you bought your home after April 3, 1994, you must reduce your basis by any points paid for your mortgage by the person who sold you your home. 2014 state tax forms   If you bought your home after 1990 but before April 4, 1994, you must reduce your basis by seller-paid points only if you deducted them. 2014 state tax forms See Points , earlier, for the rules on deducting points. 2014 state tax forms Gift To figure the basis of property you receive as a gift, you must know its adjusted basis (defined later) to the donor just before it was given to you, its fair market value (FMV) at the time it was given to you, and any gift tax paid on it. 2014 state tax forms Fair market value. 2014 state tax forms   Fair market value (FMV) is the price at which property would change hands between a willing buyer and a willing seller, neither being under any compulsion to buy or sell and who both have a reasonable knowledge of all the necessary facts. 2014 state tax forms Donor's adjusted basis is more than FMV. 2014 state tax forms   If someone gave you your home and the donor's adjusted basis, when it was given to you, was more than the FMV, your basis at the time of receipt is the same as the donor's adjusted basis. 2014 state tax forms Disposition basis. 2014 state tax forms   If the donor's adjusted basis at the time of the gift is more than the FMV, your basis (plus or minus any required adjustments, see Adjusted Basis , later) when you dispose of the property will depend on whether you have a gain or a loss. 2014 state tax forms Your basis for figuring a gain is the same as the donor's adjusted basis. 2014 state tax forms Your basis for figuring a loss is the FMV when you received the gift. 2014 state tax forms If you use the donor's adjusted basis to figure a gain and it results in a loss, then you must use the FMV (at the time of the gift) to refigure the loss. 2014 state tax forms However, if using the FMV results in a gain, then you neither have a gain nor a loss. 2014 state tax forms Example 1. 2014 state tax forms Andrew received a house as a gift from Ishmael (the donor). 2014 state tax forms At the time of the gift, the home had an FMV of $80,000. 2014 state tax forms Ishmael's adjusted basis was $100,000. 2014 state tax forms After he received the house, no events occurred to increase or decrease the basis. 2014 state tax forms If Andrew sells the house for $120,000, he will have a $20,000 gain because he must use the donor's adjusted basis ($100,000) at the time of the gift as his basis to figure the gain. 2014 state tax forms Example 2. 2014 state tax forms Same facts as Example 1 , except this time Andrew sells the house for $70,000. 2014 state tax forms He will have a loss of $10,000 because he must use the FMV ($80,000) at the time of the gift as his basis to figure the loss. 2014 state tax forms Example 3. 2014 state tax forms Same facts as Example 1 , except this time Andrew sells the house for $90,000. 2014 state tax forms Initially, he figures the gain using Ishmael's adjusted basis ($100,000), which results in a loss of $10,000. 2014 state tax forms Since it is a loss, Andrew must now recalculate the loss using the FMV ($80,000), which results in a gain of $10,000. 2014 state tax forms So in this situation, Andrew will neither have a gain nor a loss. 2014 state tax forms Donor's adjusted basis equal to or less than the FMV. 2014 state tax forms   If someone gave you your home after 1976 and the donor's adjusted basis, when it was given to you, was equal to or less than the FMV, your basis at the time of receipt is the same as the donor's adjusted basis, plus the part of any federal gift tax paid that is due to the net increase in value of the home. 2014 state tax forms Part of federal gift tax due to net increase in value. 2014 state tax forms   Figure the part of the federal gift tax paid that is due to the net increase in value of the home by multiplying the total federal gift tax paid by a fraction. 2014 state tax forms The numerator (top part) of the fraction is the net increase in the value of the home, and the denominator (bottom part) is the value of the home for gift tax purposes after reduction for any annual exclusion and marital or charitable deduction that applies to the gift. 2014 state tax forms The net increase in the value of the home is its FMV minus the adjusted basis of the donor. 2014 state tax forms Publication 551 gives more information, including examples, on figuring your basis when you receive property as a gift. 2014 state tax forms Inheritance Your basis in a home you inherited is generally the fair market value of the home on the date of the decedent's death or on the alternative valuation date if the personal representative for the estate chooses to use alternative valuation. 2014 state tax forms If an estate tax return was filed, your basis is generally the value of the home listed on the estate tax return. 2014 state tax forms If an estate tax return was not filed, your basis is the appraised value of the home at the decedent's date of death for state inheritance or transmission taxes. 2014 state tax forms Publication 551 and Publication 559, Survivors, Executors, and Administrators, have more information on the basis of inherited property. 2014 state tax forms If you inherited your home from someone who died in 2010, and the executor of the decedent's estate made the election to file Form 8939, Allocation of Increase in Basis for Property Acquired From a Decedent, refer to the information provided by the executor or see Publication 4895, Tax Treatment of Property Acquired From a Decedent Dying in 2010. 2014 state tax forms Adjusted Basis While you own your home, various events may take place that can change the original basis of your home. 2014 state tax forms These events can increase or decrease your original basis. 2014 state tax forms The result is called adjusted basis. 2014 state tax forms See Table 3, on this page, for a list of some of the items that can adjust your basis. 2014 state tax forms Table 3. 2014 state tax forms Adjusted Basis This table lists examples of some items that generally will increase or decrease your basis in your home. 2014 state tax forms It is not intended to be all-inclusive. 2014 state tax forms Increases to Basis Decreases to Basis Improvements: Putting an addition on your home Replacing an entire roof Paving your driveway Installing central air conditioning Rewiring your home Assessments for local improvements (see Assessments for local benefits , under What You Can and Cannot Deduct, earlier) Amounts spent to restore damaged property Insurance or other reimbursement for casualty losses Deductible casualty loss not covered by insurance Payments received for easement or right-of-way granted Depreciation allowed or allowable if home is used for business or rental purposes Value of subsidy for energy conservation measure excluded from income Improvements. 2014 state tax forms   An improvement materially adds to the value of your home, considerably prolongs its useful life, or adapts it to new uses. 2014 state tax forms You must add the cost of any improvements to the basis of your home. 2014 state tax forms You cannot deduct these costs. 2014 state tax forms   Improvements include putting a recreation room in your unfinished basement, adding another bathroom or bedroom, putting up a fence, putting in new plumbing or wiring, installing a new roof, and paving your driveway. 2014 state tax forms Amount added to basis. 2014 state tax forms   The amount you add to your basis for improvements is your actual cost. 2014 state tax forms This includes all costs for material and labor, except your own labor, and all expenses related to the improvement. 2014 state tax forms For example, if you had your lot surveyed to put up a fence, the cost of the survey is a part of the cost of the fence. 2014 state tax forms   You also must add to your basis state and local assessments for improvements such as streets and sidewalks if they increase the value of the property. 2014 state tax forms These assessments are discussed earlier under Real Estate Taxes . 2014 state tax forms Improvements no longer part of home. 2014 state tax forms    Your home's adjusted basis does not include the cost of any improvements that are replaced and are no longer part of the home. 2014 state tax forms Example. 2014 state tax forms You put wall-to-wall carpeting in your home 15 years ago. 2014 state tax forms Later, you replaced that carpeting with new wall-to-wall carpeting. 2014 state tax forms The cost of the old carpeting you replaced is no longer part of your home's adjusted basis. 2014 state tax forms Repairs versus improvements. 2014 state tax forms   A repair keeps your home in an ordinary, efficient operating condition. 2014 state tax forms It does not add to the value of your home or prolong its life. 2014 state tax forms Repairs include repainting your home inside or outside, fixing your gutters or floors, fixing leaks or plastering, and replacing broken window panes. 2014 state tax forms You cannot deduct repair costs and generally cannot add them to the basis of your home. 2014 state tax forms   However, repairs that are done as part of an extensive remodeling or restoration of your home are considered improvements. 2014 state tax forms You add them to the basis of your home. 2014 state tax forms Records to keep. 2014 state tax forms   You can use Table 4 (at the end of the publication) as a guide to help you keep track of improvements to your home. 2014 state tax forms Also see Keeping Records , below. 2014 state tax forms Energy conservation subsidy. 2014 state tax forms   If a public utility gives you (directly or indirectly) a subsidy for the purchase or installation of an energy conservation measure for your home, do not include the value of that subsidy in your income. 2014 state tax forms You must reduce the basis of your home by that value. 2014 state tax forms   An energy conservation measure is an installation or modification primarily designed to reduce consumption of electricity or natural gas or to improve the management of energy demand. 2014 state tax forms Keeping Records Keeping full and accurate records is vital to properly report your income and expenses, to support your deductions and credits, and to know the basis or adjusted basis of your home. 2014 state tax forms These records include your purchase contract and settlement papers if you bought the property, or other objective evidence if you acquired it by gift, inheritance, or similar means. 2014 state tax forms You should keep any receipts, canceled checks, and similar evidence for improvements or other additions to the basis. 2014 state tax forms In addition, you should keep track of any decreases to the basis such as those listed in Table 3, earlier. 2014 state tax forms How to keep records. 2014 state tax forms   How you keep records is up to you, but they must be clear and accurate and must be available to the IRS. 2014 state tax forms How long to keep records. 2014 state tax forms   You must keep your records for as long as they are important for meeting any provision of the federal tax law. 2014 state tax forms   Keep records that support an item of income, a deduction, or a credit appearing on a return until the period of limitations for the return runs out. 2014 state tax forms (A period of limitations is the period of time after which no legal action can be brought. 2014 state tax forms ) For assessment of tax you owe, this is generally 3 years from the date you filed the return. 2014 state tax forms For filing a claim for credit or refund, this is generally 3 years from the date you filed the original return, or 2 years from the date you paid the tax, whichever is later. 2014 state tax forms Returns filed before the due date are treated as filed on the due date. 2014 state tax forms   You may need to keep records relating to the basis of property (discussed earlier) for longer than the period of limitations. 2014 state tax forms Keep those records as long as they are important in figuring the basis of the original or replacement property. 2014 state tax forms Generally, this means for as long as you own the property and, after you dispose of it, for the period of limitations that applies to you. 2014 state tax forms Table 4. 2014 state tax forms Record of Home Improvements Keep this for your records. 2014 state tax forms Also, keep receipts or other proof of improvements. 2014 state tax forms Remove from this record any improvements that are no longer part of your main home. 2014 state tax forms For example, if you put wall-to-wall carpeting in your home and later replace it with new wall-to-wall carpeting, remove the cost of the first carpeting. 2014 state tax forms (a) Type of Improvement (b) Date (c) Amount   (a) Type of Improvement (b) Date (c) Amount Additions:       Heating & Air  Conditioning:     Bedroom       Heating system     Bathroom       Central air conditioning     Deck       Furnace     Garage       Duct work     Porch       Central humidifier     Patio       Filtration system     Storage shed       Other     Fireplace       Electrical:     Other           Lawn & Grounds:       Lighting fixtures           Wiring upgrades     Landscaping       Other     Driveway       Plumbing:     Walkway           Fences       Water heater     Retaining wall       Soft water system     Sprinkler system       Filtration system     Swimming pool       Other     Exterior lighting       Insulation:     Other           Communications:       Attic           Walls     Satellite dish       Floors     Intercom       Pipes and duct work     Security system       Other     Other             Miscellaneous:       Interior  Improvements:     Storm windows and doors       Built-in appliances     Roof       Kitchen modernization     Central vacuum       Bathroom modernization     Other       Flooring             Wall-to-wall carpeting             Other     How To