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Free H & R Block Tax Filing

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Free H & R Block Tax Filing

Free h & r block tax filing 2. Free h & r block tax filing   Simplified Employee Pensions (SEPs) Table of Contents Topics - This chapter discusses: Useful Items - You may want to see: Setting Up a SEPWhen not to use Form 5305-SEP. Free h & r block tax filing How Much Can I Contribute?Contribution Limits Deducting ContributionsDeduction Limit for Contributions for Participants Deduction Limit for Self-Employed Individuals Carryover of Excess SEP Contributions When To Deduct Contributions Where To Deduct Contributions Salary Reduction Simplified Employee Pensions (SARSEPs)SARSEP ADP test. Free h & r block tax filing Deferral percentage. Free h & r block tax filing Employee compensation. Free h & r block tax filing Compensation of self-employed individuals. Free h & r block tax filing Choice not to treat deferrals as compensation. Free h & r block tax filing Limit on Elective Deferrals Tax Treatment of Deferrals Distributions (Withdrawals) Additional TaxesEffects on employee. Free h & r block tax filing Reporting and Disclosure Requirements Topics - This chapter discusses: Setting up a SEP How much can I contribute Deducting contributions Salary reduction simplified employee pensions (SARSEPs) Distributions (withdrawals) Additional taxes Reporting and disclosure requirements Useful Items - You may want to see: Publication 590 Individual Retirement Arrangements (IRAs) 3998 Choosing A Retirement Solution for Your Small Business 4285 SEP Checklist 4286 SARSEP Checklist 4333 SEP Retirement Plans for Small Businesses 4336 SARSEP for Small Businesses 4407 SARSEP—Key Issues and Assistance Forms (and Instructions) W-2 Wage and Tax Statement 1040 U. Free h & r block tax filing S. Free h & r block tax filing Individual Income Tax Return 5305-SEP Simplified Employee Pension—Individual Retirement Accounts Contribution Agreement 5305A-SEP Salary Reduction Simplified Employee Pension—Individual Retirement Accounts Contribution Agreement 8880 Credit for Qualified Retirement Savings Contributions 8881 Credit for Small Employer Pension Plan Startup Costs A SEP is a written plan that allows you to make contributions toward your own retirement and your employees' retirement without getting involved in a more complex qualified plan. Free h & r block tax filing Under a SEP, you make contributions to a traditional individual retirement arrangement (called a SEP-IRA) set up by or for each eligible employee. Free h & r block tax filing A SEP-IRA is owned and controlled by the employee, and you make contributions to the financial institution where the SEP-IRA is maintained. Free h & r block tax filing SEP-IRAs are set up for, at a minimum, each eligible employee (defined below). Free h & r block tax filing A SEP-IRA may have to be set up for a leased employee (defined in chapter 1), but does not need to be set up for excludable employees (defined later). Free h & r block tax filing Eligible employee. Free h & r block tax filing   An eligible employee is an individual who meets all the following requirements. Free h & r block tax filing Has reached age 21. Free h & r block tax filing Has worked for you in at least 3 of the last 5 years. Free h & r block tax filing Has received at least $550 in compensation from you in 2013. Free h & r block tax filing This amount remains the same in 2014. Free h & r block tax filing    You can use less restrictive participation requirements than those listed, but not more restrictive ones. Free h & r block tax filing Excludable employees. Free h & r block tax filing   The following employees can be excluded from coverage under a SEP. Free h & r block tax filing Employees covered by a union agreement and whose retirement benefits were bargained for in good faith by the employees' union and you. Free h & r block tax filing Nonresident alien employees who have received no U. Free h & r block tax filing S. Free h & r block tax filing source wages, salaries, or other personal services compensation from you. Free h & r block tax filing For more information about nonresident aliens, see Publication 519, U. Free h & r block tax filing S. Free h & r block tax filing Tax Guide for Aliens. Free h & r block tax filing Setting Up a SEP There are three basic steps in setting up a SEP. Free h & r block tax filing You must execute a formal written agreement to provide benefits to all eligible employees. Free h & r block tax filing You must give each eligible employee certain information about the SEP. Free h & r block tax filing A SEP-IRA must be set up by or for each eligible employee. Free h & r block tax filing Many financial institutions will help you set up a SEP. Free h & r block tax filing Formal written agreement. Free h & r block tax filing   You must execute a formal written agreement to provide benefits to all eligible employees under a SEP. Free h & r block tax filing You can satisfy the written agreement requirement by adopting an IRS model SEP using Form 5305-SEP. Free h & r block tax filing However, see When not to use Form 5305-SEP, below. Free h & r block tax filing   If you adopt an IRS model SEP using Form 5305-SEP, no prior IRS approval or determination letter is required. Free h & r block tax filing Keep the original form. Free h & r block tax filing Do not file it with the IRS. Free h & r block tax filing Also, using Form 5305-SEP will usually relieve you from filing annual retirement plan information returns with the IRS and the Department of Labor. Free h & r block tax filing See the Form 5305-SEP instructions for details. Free h & r block tax filing If you choose not to use Form 5305-SEP, you should seek professional advice in adopting a SEP. Free h & r block tax filing When not to use Form 5305-SEP. Free h & r block tax filing   You cannot use Form 5305-SEP if any of the following apply. Free h & r block tax filing You currently maintain any other qualified retirement plan other than another SEP. Free h & r block tax filing You have any eligible employees for whom IRAs have not been set up. Free h & r block tax filing You use the services of leased employees, who are not your common-law employees (as described in chapter 1). Free h & r block tax filing You are a member of any of the following unless all eligible employees of all the members of these groups, trades, or businesses participate under the SEP. Free h & r block tax filing An affiliated service group described in section 414(m). Free h & r block tax filing A controlled group of corporations described in section 414(b). Free h & r block tax filing Trades or businesses under common control described in section 414(c). Free h & r block tax filing You do not pay the cost of the SEP contributions. Free h & r block tax filing Information you must give to employees. Free h & r block tax filing   You must give each eligible employee a copy of Form 5305-SEP, its instructions, and the other information listed in the Form 5305-SEP instructions. Free h & r block tax filing An IRS model SEP is not considered adopted until you give each employee this information. Free h & r block tax filing Setting up the employee's SEP-IRA. Free h & r block tax filing   A SEP-IRA must be set up by or for each eligible employee. Free h & r block tax filing SEP-IRAs can be set up with banks, insurance companies, or other qualified financial institutions. Free h & r block tax filing You send SEP contributions to the financial institution where the SEP-IRA is maintained. Free h & r block tax filing Deadline for setting up a SEP. Free h & r block tax filing   You can set up a SEP for any year as late as the due date (including extensions) of your income tax return for that year. Free h & r block tax filing Credit for startup costs. Free h & r block tax filing   You may be able to claim a tax credit for part of the ordinary and necessary costs of starting a SEP that first became effective in 2013. Free h & r block tax filing For more information, see Credit for startup costs under Reminders, earlier. Free h & r block tax filing How Much Can I Contribute? The SEP rules permit you to contribute a limited amount of money each year to each employee's SEP-IRA. Free h & r block tax filing If you are self-employed, you can contribute to your own SEP-IRA. Free h & r block tax filing Contributions must be in the form of money (cash, check, or money order). Free h & r block tax filing You cannot contribute property. Free h & r block tax filing However, participants may be able to transfer or roll over certain property from one retirement plan to another. Free h & r block tax filing See Publication 590 for more information about rollovers. Free h & r block tax filing You do not have to make contributions every year. Free h & r block tax filing But if you make contributions, they must be based on a written allocation formula and must not discriminate in favor of highly compensated employees (defined in chapter 1). Free h & r block tax filing When you contribute, you must contribute to the SEP-IRAs of all participants who actually performed personal services during the year for which the contributions are made, including employees who die or terminate employment before the contributions are made. Free h & r block tax filing Contributions are deductible within limits, as discussed later, and generally are not taxable to the plan participants. Free h & r block tax filing A SEP-IRA cannot be a Roth IRA. Free h & r block tax filing Employer contributions to a SEP-IRA will not affect the amount an individual can contribute to a Roth or traditional IRA. Free h & r block tax filing Unlike regular contributions to a traditional IRA, contributions under a SEP can be made to participants over age 70½. Free h & r block tax filing If you are self-employed, you can also make contributions under the SEP for yourself even if you are over 70½. Free h & r block tax filing Participants age 70½ or over must take required minimum distributions. Free h & r block tax filing Time limit for making contributions. Free h & r block tax filing   To deduct contributions for a year, you must make the contributions by the due date (including extensions) of your tax return for the year. Free h & r block tax filing Contribution Limits Contributions you make for 2013 to a common-law employee's SEP-IRA cannot exceed the lesser of 25% of the employee's compensation or $51,000. Free h & r block tax filing Compensation generally does not include your contributions to the SEP. Free h & r block tax filing The SEP plan document will specify how the employer contribution is determined and how it will be allocated to participants. Free h & r block tax filing Example. Free h & r block tax filing Your employee, Mary Plant, earned $21,000 for 2013. Free h & r block tax filing The maximum contribution you can make to her SEP-IRA is $5,250 (25% x $21,000). Free h & r block tax filing Contributions for yourself. Free h & r block tax filing   The annual limits on your contributions to a common-law employee's SEP-IRA also apply to contributions you make to your own SEP-IRA. Free h & r block tax filing However, special rules apply when figuring your maximum deductible contribution. Free h & r block tax filing See Deduction Limit for Self-Employed Individuals , later. Free h & r block tax filing Annual compensation limit. Free h & r block tax filing   You cannot consider the part of an employee's compensation over $255,000 when figuring your contribution limit for that employee. Free h & r block tax filing However, $51,000 is the maximum contribution for an eligible employee. Free h & r block tax filing These limits are $260,000 and $52,000, respectively, in 2014. Free h & r block tax filing Example. Free h & r block tax filing Your employee, Susan Green, earned $210,000 for 2013. Free h & r block tax filing Because of the maximum contribution limit for 2013, you can only contribute $51,000 to her SEP-IRA. Free h & r block tax filing More than one plan. Free h & r block tax filing   If you contribute to a defined contribution plan (defined in chapter 4), annual additions to an account are limited to the lesser of $51,000 or 100% of the participant's compensation. Free h & r block tax filing When you figure this limit, you must add your contributions to all defined contribution plans maintained by you. Free h & r block tax filing Because a SEP is considered a defined contribution plan for this limit, your contributions to a SEP must be added to your contributions to other defined contribution plans you maintain. Free h & r block tax filing Tax treatment of excess contributions. Free h & r block tax filing   Excess contributions are your contributions to an employee's SEP-IRA (or to your own SEP-IRA) for 2013 that exceed the lesser of the following amounts. Free h & r block tax filing 25% of the employee's compensation (or, for you, 20% of your net earnings from self-employment). Free h & r block tax filing $51,000. Free h & r block tax filing Excess contributions are included in the employee's income for the year and are treated as contributions by the employee to his or her SEP-IRA. Free h & r block tax filing For more information on employee tax treatment of excess contributions, see chapter 1 in Publication 590. Free h & r block tax filing Reporting on Form W-2. Free h & r block tax filing   Do not include SEP contributions on your employee's Form W-2 unless contributions were made under a salary reduction arrangement (discussed later). Free h & r block tax filing Deducting Contributions Generally, you can deduct the contributions you make each year to each employee's SEP-IRA. Free h & r block tax filing If you are self-employed, you can deduct the contributions you make each year to your own SEP-IRA. Free h & r block tax filing Deduction Limit for Contributions for Participants The most you can deduct for your contributions to you or your employee's SEP-IRA is the lesser of the following amounts. Free h & r block tax filing Your contributions (including any excess contributions carryover). Free h & r block tax filing 25% of the compensation (limited to $255,000 per participant) paid to the participants during 2013 from the business that has the plan, not to exceed $51,000 per participant. Free h & r block tax filing In 2014, the amounts in (2) above are $260,000 and $52,000, respectively. Free h & r block tax filing Deduction Limit for Self-Employed Individuals If you contribute to your own SEP-IRA, you must make a special computation to figure your maximum deduction for these contributions. Free h & r block tax filing When figuring the deduction for contributions made to your own SEP-IRA, compensation is your net earnings from self-employment (defined in chapter 1), which takes into account both the following deductions. Free h & r block tax filing The deduction for the deductible part of your self-employment tax. Free h & r block tax filing The deduction for contributions to your own SEP-IRA. Free h & r block tax filing The deduction for contributions to your own SEP-IRA and your net earnings depend on each other. Free h & r block tax filing For this reason, you determine the deduction for contributions to your own SEP-IRA indirectly by reducing the contribution rate called for in your plan. Free h & r block tax filing To do this, use the Rate Table for Self-Employed or the Rate Worksheet for Self-Employed, whichever is appropriate for your plan's contribution rate, in chapter 5. Free h & r block tax filing Then figure your maximum deduction by using the Deduction Worksheet for Self-Employed in chapter 5. Free h & r block tax filing Carryover of Excess SEP Contributions If you made SEP contributions that are more than the deduction limit (nondeductible contributions), you can carry over and deduct the difference in later years. Free h & r block tax filing However, the carryover, when combined with the contribution for the later year, is subject to the deduction limit for that year. Free h & r block tax filing If you also contributed to a defined benefit plan or defined contribution plan, see Carryover of Excess Contributions under Employer Deduction in chapter 4 for the carryover limit. Free h & r block tax filing Excise tax. Free h & r block tax filing   If you made nondeductible (excess) contributions to a SEP, you may be subject to a 10% excise tax. Free h & r block tax filing For information about the excise tax, see Excise Tax for Nondeductible (Excess) Contributions under Employer Deduction in chapter 4. Free h & r block tax filing When To Deduct Contributions When you can deduct contributions made for a year depends on the tax year on which the SEP is maintained. Free h & r block tax filing If the SEP is maintained on a calendar year basis, you deduct the yearly contributions on your tax return for the year within which the calendar year ends. Free h & r block tax filing If you file your tax return and maintain the SEP using a fiscal year or short tax year, you deduct contributions made for a year on your tax return for that year. Free h & r block tax filing Example. Free h & r block tax filing You are a fiscal year taxpayer whose tax year ends June 30. Free h & r block tax filing You maintain a SEP on a calendar year basis. Free h & r block tax filing You deduct SEP contributions made for calendar year 2013 on your tax return for your tax year ending June 30, 2014. Free h & r block tax filing Where To Deduct Contributions Deduct the contributions you make for your common-law employees on your tax return. Free h & r block tax filing For example, sole proprietors deduct them on Schedule C (Form 1040) or Schedule F (Form 1040), Profit or Loss From Farming; partnerships deduct them on Form 1065, U. Free h & r block tax filing S. Free h & r block tax filing Return of Partnership Income; and corporations deduct them on Form 1120, U. Free h & r block tax filing S. Free h & r block tax filing Corporation Income Tax Return, or Form 1120S, U. Free h & r block tax filing S. Free h & r block tax filing Income Tax Return for an S Corporation. Free h & r block tax filing Sole proprietors and partners deduct contributions for themselves on line 28 of Form 1040. Free h & r block tax filing (If you are a partner, contributions for yourself are shown on the Schedule K-1 (Form 1065), Partner's Share of Income, Deductions, Credits, etc. Free h & r block tax filing , you receive from the partnership. Free h & r block tax filing ) Remember that sole proprietors and partners can't deduct as a business expense contributions made to a SEP for themselves, only those made for their common-law employees. Free h & r block tax filing Salary Reduction Simplified Employee Pensions (SARSEPs) A SARSEP is a SEP set up before 1997 that includes a salary reduction arrangement. Free h & r block tax filing (See the Caution, next. Free h & r block tax filing ) Under a SARSEP, your employees can choose to have you contribute part of their pay to their SEP-IRAs rather than receive it in cash. Free h & r block tax filing This contribution is called an “elective deferral” because employees choose (elect) to set aside the money, and they defer the tax on the money until it is distributed to them. Free h & r block tax filing You are not allowed to set up a SARSEP after 1996. Free h & r block tax filing However, participants (including employees hired after 1996) in a SARSEP set up before 1997 can continue to have you contribute part of their pay to the plan. Free h & r block tax filing If you are interested in setting up a retirement plan that includes a salary reduction arrangement, see chapter 3. Free h & r block tax filing Who can have a SARSEP?   A SARSEP set up before 1997 is available to you and your eligible employees only if all the following requirements are met. Free h & r block tax filing At least 50% of your employees eligible to participate choose to make elective deferrals. Free h & r block tax filing You have 25 or fewer employees who were eligible to participate in the SEP at any time during the preceding year. Free h & r block tax filing The elective deferrals of your highly compensated employees meet the SARSEP ADP test. Free h & r block tax filing SARSEP ADP test. Free h & r block tax filing   Under the SARSEP ADP test, the amount deferred each year by each eligible highly compensated employee as a percentage of pay (the deferral percentage) cannot be more than 125% of the average deferral percentage (ADP) of all non-highly compensated employees eligible to participate. Free h & r block tax filing A highly compensated employee is defined in chapter 1. Free h & r block tax filing Deferral percentage. Free h & r block tax filing   The deferral percentage for an employee for a year is figured as follows. Free h & r block tax filing   The elective employer contributions (excluding certain catch-up contributions)  paid to the SEP for the employee for the year     The employee's compensation (limited to $255,000 in 2013)   The instructions for Form 5305A-SEP have a worksheet you can use to determine whether the elective deferrals of your highly compensated employees meet the SARSEP ADP test. Free h & r block tax filing Employee compensation. Free h & r block tax filing   For figuring the deferral percentage, compensation is generally the amount you pay to the employee for the year. Free h & r block tax filing Compensation includes the elective deferral and other amounts deferred in certain employee benefit plans. Free h & r block tax filing See Compensation in chapter 1. Free h & r block tax filing Elective deferrals under the SARSEP are included in figuring your employees' deferral percentage even though they are not included in the income of your employees for income tax purposes. Free h & r block tax filing Compensation of self-employed individuals. Free h & r block tax filing   If you are self-employed, compensation is your net earnings from self-employment as defined in chapter 1. Free h & r block tax filing   Compensation does not include tax-free items (or deductions related to them) other than foreign earned income and housing cost amounts. Free h & r block tax filing Choice not to treat deferrals as compensation. Free h & r block tax filing   You can choose not to treat elective deferrals (and other amounts deferred in certain employee benefit plans) for a year as compensation under your SARSEP. Free h & r block tax filing Limit on Elective Deferrals The most a participant can choose to defer for calendar year 2013 is the lesser of the following amounts. Free h & r block tax filing 25% of the participant's compensation (limited to $255,000 of the participant's compensation). Free h & r block tax filing $17,500. Free h & r block tax filing The $17,500 limit applies to the total elective deferrals the employee makes for the year to a SEP and any of the following. Free h & r block tax filing Cash or deferred arrangement (section 401(k) plan). Free h & r block tax filing Salary reduction arrangement under a tax-sheltered annuity plan (section 403(b) plan). Free h & r block tax filing SIMPLE IRA plan. Free h & r block tax filing In 2014, the $255,000 limit increases to $260,000 and the $17,500 limit remains at $17,500. Free h & r block tax filing Catch-up contributions. Free h & r block tax filing   A SARSEP can permit participants who are age 50 or over at the end of the calendar year to also make catch-up contributions. Free h & r block tax filing The catch-up contribution limit for 2013 is $5,500 and remains at $5,500 for 2014. Free h & r block tax filing Elective deferrals are not treated as catch-up contributions for 2013 until they exceed the elective deferral limit (the lesser of 25% of compensation or $17,500), the SARSEP ADP test limit discussed earlier, or the plan limit (if any). Free h & r block tax filing However, the catch-up contribution a participant can make for a year cannot exceed the lesser of the following amounts. Free h & r block tax filing The catch-up contribution limit. Free h & r block tax filing The excess of the participant's compensation over the elective deferrals that are not catch-up contributions. Free h & r block tax filing   Catch-up contributions are not subject to the elective deferral limit (the lesser of 25% of compensation or $17,500 in 2013 and in 2014). Free h & r block tax filing Overall limit on SEP contributions. Free h & r block tax filing   If you also make nonelective contributions to a SEP-IRA, the total of the nonelective and elective contributions to that SEP-IRA cannot exceed the lesser of 25% of the employee's compensation or $51,000 for 2013 ($52,000 for 2014). Free h & r block tax filing The same rule applies to contributions you make to your own SEP-IRA. Free h & r block tax filing See Contribution Limits , earlier. Free h & r block tax filing Figuring the elective deferral. Free h & r block tax filing   For figuring the 25% limit on elective deferrals, compensation does not include SEP contributions, including elective deferrals or other amounts deferred in certain employee benefit plans. Free h & r block tax filing Tax Treatment of Deferrals Elective deferrals that are not more than the limits discussed earlier under Limit on Elective Deferrals are excluded from your employees' wages subject to federal income tax in the year of deferral. Free h & r block tax filing However, these deferrals are included in wages for social security, Medicare, and federal unemployment (FUTA) tax. Free h & r block tax filing Excess deferrals. Free h & r block tax filing   For 2013, excess deferrals are the elective deferrals for the year that are more than the $17,500 limit discussed earlier. Free h & r block tax filing For a participant who is eligible to make catch-up contributions, excess deferrals are the elective deferrals that are more than $23,000. Free h & r block tax filing The treatment of excess deferrals made under a SARSEP is similar to the treatment of excess deferrals made under a qualified plan. Free h & r block tax filing See Treatment of Excess Deferrals under Elective Deferrals (401(k) Plans) in chapter 4. Free h & r block tax filing Excess SEP contributions. Free h & r block tax filing   Excess SEP contributions are elective deferrals of highly compensated employees that are more than the amount permitted under the SARSEP ADP test. Free h & r block tax filing You must notify your highly compensated employees within 2½ months after the end of the plan year of their excess SEP contributions. Free h & r block tax filing If you do not notify them within this time period, you must pay a 10% tax on the excess. Free h & r block tax filing For an explanation of the notification requirements, see Rev. Free h & r block tax filing Proc. Free h & r block tax filing 91-44, 1991-2 C. Free h & r block tax filing B. Free h & r block tax filing 733. Free h & r block tax filing If you adopted a SARSEP using Form 5305A-SEP, the notification requirements are explained in the instructions for that form. Free h & r block tax filing Reporting on Form W-2. Free h & r block tax filing   Do not include elective deferrals in the “Wages, tips, other compensation” box of Form W-2. Free h & r block tax filing You must, however, include them in the “Social security wages” and “Medicare wages and tips” boxes. Free h & r block tax filing You must also include them in box 12. Free h & r block tax filing Mark the “Retirement plan” checkbox in box 13. Free h & r block tax filing For more information, see the Form W-2 instructions. Free h & r block tax filing Distributions (Withdrawals) As an employer, you cannot prohibit distributions from a SEP-IRA. Free h & r block tax filing Also, you cannot make your contributions on the condition that any part of them must be kept in the account after you have made your contributions to the employee's accounts. Free h & r block tax filing Distributions are subject to IRA rules. Free h & r block tax filing Generally, you or your employee must begin to receive distributions from a SEP-IRA by April 1 of the first year after the calendar year in which you or your employee reaches age 70½. Free h & r block tax filing For more information about IRA rules, including the tax treatment of distributions, rollovers, required distributions, and income tax withholding, see Publication 590. Free h & r block tax filing Additional Taxes The tax advantages of using SEP-IRAs for retirement savings can be offset by additional taxes that may be imposed for all the following actions. Free h & r block tax filing Making excess contributions. Free h & r block tax filing Making early withdrawals. Free h & r block tax filing Not making required withdrawals. Free h & r block tax filing For information about these taxes, see chapter 1 in Publication 590. Free h & r block tax filing Also, a SEP-IRA may be disqualified, or an excise tax may apply, if the account is involved in a prohibited transaction, discussed next. Free h & r block tax filing Prohibited transaction. Free h & r block tax filing   If an employee improperly uses his or her SEP-IRA, such as by borrowing money from it, the employee has engaged in a prohibited transaction. Free h & r block tax filing In that case, the SEP-IRA will no longer qualify as an IRA. Free h & r block tax filing For a list of prohibited transactions, see Prohibited Transactions in chapter 4. Free h & r block tax filing Effects on employee. Free h & r block tax filing   If a SEP-IRA is disqualified because of a prohibited transaction, the assets in the account will be treated as having been distributed to the employee on the first day of the year in which the transaction occurred. Free h & r block tax filing The employee must include in income the fair market value of the assets (on the first day of the year) that is more than any cost basis in the account. Free h & r block tax filing Also, the employee may have to pay the additional tax for making early withdrawals. Free h & r block tax filing Reporting and Disclosure Requirements If you set up a SEP using Form 5305-SEP, you must give your eligible employees certain information about the SEP when you set it up. Free h & r block tax filing See Setting Up a SEP , earlier. Free h & r block tax filing Also, you must give your eligible employees a statement each year showing any contributions to their SEP-IRAs. Free h & r block tax filing You must also give them notice of any excess contributions. Free h & r block tax filing For details about other information you must give them, see the instructions for Form 5305-SEP or Form 5305A-SEP (for a salary reduction SEP). Free h & r block tax filing Even if you did not use Form 5305-SEP or Form 5305A-SEP to set up your SEP, you must give your employees information similar to that described above. Free h & r block tax filing For more information, see the instructions for either Form 5305-SEP or Form 5305A-SEP. Free h & r block tax filing Prev  Up  Next   Home   More Online Publications
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Look for Warning Signs

Look for these warning signs to avoid fraud:

  • Someone you don't know asks you to send money or money orders to claim a prize, lottery, credit card, loan, or other valuable offer.
  • Someone you don't know offers you the chance to receive a credit card, loan, prize, lottery, or other valuable item, but asks you for personal data to claim it.
  • An unknown caller claiming to be a lawyer or in law enforcement offers to help you get your money back (for a fee).
  • The deal is only good "for today" or a short period of time.
  • The seller offers "free gifts" in return for a minimum effort or a fee.
  • A "repair person" suddenly finds a dangerous defect in your car or home.
  • You are given little or no time to read a contract.
  • A sale item is suddenly unavailable but a "much better item" is available for slightly more money.
  • Someone is trying to scare you into purchasing credit protection plans.
  • The solicitation looks like a government document and suggests contest winnings or unclaimed assets are yours for a small fee. (The government doesn't solicit money from citizens.)
  • You are asked for your bank account or credit card number.

Quick Tips for Avoiding Fraud

  • Don't give out personal information. Be suspicious of anyone you don't know who asks for your Social Security number, credit card and bank account details, date of birth, etc.
  • Don't be intimidated. Be suspicious of calls or e-mails that want you to provide or verify personal information immediately. Tell them you're not interested and hang up or don't reply to the e-mail.
  • Monitor your accounts. Review bank and credit card statements carefully. Report unauthorized transactions to your financial institution immediately.
  • Use a shredder. Tear or shred credit offers you receive in the mail, bank statements, insurance forms and other papers with personal information.

Fraud Alert

Be on the lookout for these common scams:

  • Fake Check Scams- You discover the check is worthless after you've deposited it and wired money back to the crook.
  • Sweetheart Swindles- Criminals befriend you in online chat rooms or dating sites, then request money as a favor or for accident or travel expenses.
  • Auctions- Beware of fraudulent sellers and bogus merchandise.
  • Lotteries- Don't fall for foreign lotteries; they're illegal to play and may be a scam.
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The Free H & R Block Tax Filing

Free h & r block tax filing Publication 536 - Main Content Table of Contents NOL Steps How To Figure an NOLNonbusiness deductions (line 6). Free h & r block tax filing Nonbusiness income (line 7). Free h & r block tax filing Nonbusiness capital losses. Free h & r block tax filing Business capital losses. Free h & r block tax filing Illustrated Form 1045, Schedule A When To Use an NOLExceptions to 2-Year Carryback Rule Waiving the Carryback Period How To Carry an NOL Back or Forward How To Claim an NOL DeductionDeducting a Carryback Deducting a Carryforward Change in Marital Status Change in Filing Status Illustrated Form 1045 How To Figure an NOL CarryoverIllustrated Form 1045, Schedule B NOL Carryover From 2013 to 2014Worksheet Instructions How To Get Tax HelpLow Income Taxpayer Clinics NOL Steps Follow Steps 1 through 5 to figure and use your NOL. Free h & r block tax filing Step 1. Free h & r block tax filing   Complete your tax return for the year. Free h & r block tax filing You may have an NOL if a negative figure appears on the line below: Individuals — Form 1040, line 41, or Form 1040NR, line 39. Free h & r block tax filing Estates and trusts — Form 1041, line 22. Free h & r block tax filing   If the amount on that line is not negative, stop here — you do not have an NOL. Free h & r block tax filing Step 2. Free h & r block tax filing   Determine whether you have an NOL and its amount. Free h & r block tax filing See How To Figure an NOL , later. Free h & r block tax filing If you do not have an NOL, stop here. Free h & r block tax filing Step 3. Free h & r block tax filing   Decide whether to carry the NOL back to a past year or to waive the carryback period and instead carry the NOL forward to a future year. Free h & r block tax filing See When To Use an NOL , later. Free h & r block tax filing Step 4. Free h & r block tax filing   Deduct the NOL in the carryback or carryforward year. Free h & r block tax filing See How To Claim an NOL Deduction , later. Free h & r block tax filing If your NOL deduction is equal to or less than your taxable income without the deduction, stop here — you have used up your NOL. Free h & r block tax filing Step 5. Free h & r block tax filing   Determine the amount of your unused NOL. Free h & r block tax filing See How To Figure an NOL Carryover , later. Free h & r block tax filing Carry over the unused NOL to the next carryback or carryforward year and begin again at Step 4. Free h & r block tax filing Note. Free h & r block tax filing   If your NOL deduction includes more than one NOL amount, apply Step 5 separately to each NOL amount, starting with the amount from the earliest year. Free h & r block tax filing How To Figure an NOL If your deductions for the year are more than your income for the year, you may have an NOL. Free h & r block tax filing There are rules that limit what you can deduct when figuring an NOL. Free h & r block tax filing In general, the following items are not allowed when figuring an NOL. Free h & r block tax filing Any deduction for personal exemptions. Free h & r block tax filing Capital losses in excess of capital gains. Free h & r block tax filing The section 1202 exclusion of the gain from the sale or exchange of qualified small business stock. Free h & r block tax filing Nonbusiness deductions in excess of nonbusiness income. Free h & r block tax filing The net operating loss deduction. Free h & r block tax filing The domestic production activities deduction. Free h & r block tax filing Form 1045, Schedule A. Free h & r block tax filing   Use Form 1045, Schedule A, to figure an NOL. Free h & r block tax filing The following discussion explains Schedule A and includes an illustrated example. Free h & r block tax filing   First, complete Form 1045, Schedule A, line 1, using amounts from your return. Free h & r block tax filing If line 1 is a negative amount, you may have an NOL. Free h & r block tax filing   Next, complete the rest of Form 1045, Schedule A, to figure your NOL. Free h & r block tax filing Nonbusiness deductions (line 6). Free h & r block tax filing   Enter on line 6 deductions that are not connected to your trade or business or your employment. Free h & r block tax filing Examples of deductions not related to your trade or business are: Alimony paid, Deductions for contributions to an IRA or a self-employed retirement plan, Health savings account deduction, Archer medical savings account deduction, Most itemized deductions (except for casualty and theft losses, state income tax on trade and business income, and any employee business expenses), and The standard deduction. Free h & r block tax filing   Do not include on line 6 the deduction for personal exemptions for you, your spouse, or your dependents. Free h & r block tax filing   Do not enter business deductions on line 6. Free h & r block tax filing These are deductions that are connected to your trade or business. Free h & r block tax filing They include the following. Free h & r block tax filing State income tax on income attributable to trade or business (including wages, salary, and unemployment compensation). Free h & r block tax filing Moving expenses. Free h & r block tax filing Educator expenses. Free h & r block tax filing The deduction for the deductible part of self-employed health insurance. Free h & r block tax filing Domestic production activities deduction. Free h & r block tax filing Rental losses. Free h & r block tax filing Loss on the sale or exchange of business real estate or depreciable property. Free h & r block tax filing Your share of a business loss from a partnership or an S corporation. Free h & r block tax filing Ordinary loss on the sale or exchange of stock in a small business corporation or a small business investment company. Free h & r block tax filing If you itemize your deductions, casualty and theft losses (even if they involve nonbusiness property) and employee business expenses (such as union dues, uniforms, tools, education expenses, and travel and transportation expenses). Free h & r block tax filing Loss on the sale of accounts receivable (if you use an accrual method of accounting). Free h & r block tax filing Interest and litigation expenses on state and federal income taxes related to your business. Free h & r block tax filing Unrecovered investment in a pension or annuity claimed on a decedent's final return. Free h & r block tax filing Payment by a federal employee to buy back sick leave used in an earlier year. Free h & r block tax filing Nonbusiness income (line 7). Free h & r block tax filing   Enter on line 7 only income that is not related to your trade or business or your employment. Free h & r block tax filing For example, enter your annuity income, dividends, and interest on investments. Free h & r block tax filing Also, include your share of nonbusiness income from partnerships and S corporations. Free h & r block tax filing   Do not include on line 7 the income you receive from your trade or business or your employment. Free h & r block tax filing This includes salaries and wages, self-employment income, unemployment compensation included in your gross income, and your share of business income from partnerships and S corporations. Free h & r block tax filing Also, do not include rental income or ordinary gain from the sale or other disposition of business real estate or depreciable business property. Free h & r block tax filing Adjustment for section 1202 exclusion (line 17). Free h & r block tax filing   Enter on line 17 any gain you excluded under section 1202 on the sale or exchange of qualified small business stock. Free h & r block tax filing Adjustments for capital losses (lines 19–22). Free h & r block tax filing   The amount deductible for capital losses is limited based on whether the losses are business capital losses or nonbusiness capital losses. Free h & r block tax filing Nonbusiness capital losses. Free h & r block tax filing   You can deduct your nonbusiness capital losses (line 2) only up to the amount of your nonbusiness capital gains without regard to any section 1202 exclusion (line 3). Free h & r block tax filing If your nonbusiness capital losses are more than your nonbusiness capital gains without regard to any section 1202 exclusion, you cannot deduct the excess. Free h & r block tax filing Business capital losses. Free h & r block tax filing   You can deduct your business capital losses (line 11) only up to the total of: Your nonbusiness capital gains that are more than the total of your nonbusiness capital losses and excess nonbusiness deductions (line 10), and Your total business capital gains without regard to any section 1202 exclusion (line 12). Free h & r block tax filing Domestic production activities deduction (line 23). Free h & r block tax filing   You cannot take the domestic production activities deduction when figuring your NOL. Free h & r block tax filing Enter on line 23 any domestic production activities deduction claimed on your return. Free h & r block tax filing NOLs from other years (line 24). Free h & r block tax filing   You cannot deduct any NOL carryovers or carrybacks from other years. Free h & r block tax filing Enter the total amount of your NOL deduction for losses from other years. Free h & r block tax filing Illustrated Form 1045, Schedule A The following example illustrates how to figure an NOL. Free h & r block tax filing It includes filled-in pages 1 and 2 of Form 1040 and Form 1045, Schedule A. Free h & r block tax filing Example. Free h & r block tax filing Glenn Johnson is in the retail record business. Free h & r block tax filing He is single and has the following income and deductions on his Form 1040 for 2013. Free h & r block tax filing See the illustrated Form 1040 , later. Free h & r block tax filing INCOME   Wages from part-time job $1,225 Interest on savings 425 Net long-term capital gain on sale of real estate used in business 2,000 Glenn's total income $3,650 DEDUCTIONS   Net loss from business (gross income of $67,000 minus expenses of $72,000) $5,000 Net short-term capital loss on sale of stock 1,000 Standard deduction 6,100 Personal exemption 3,900 Glenn's total deductions $16,000 Glenn's deductions exceed his income by $12,350 ($16,000 − $3,650). Free h & r block tax filing However, to figure whether he has an NOL, certain deductions are not allowed. Free h & r block tax filing He uses Form 1045, Schedule A, to figure his NOL. Free h & r block tax filing See the Illustrated Form 1045, Schedule A , later. Free h & r block tax filing The following items are not allowed on Form 1045, Schedule A. Free h & r block tax filing Nonbusiness net short-term capital loss $1,000 Nonbusiness deductions (standard deduction, $6,100) minus nonbusiness income (interest, $425) 5,675 Deduction for personal exemption 3,900 Total adjustments to net loss $10,575     Therefore, Glenn's NOL for 2013 is figured as follows: Glenn's total 2013 income $3,650 Less:     Glenn's original 2013 total deductions $16,000   Reduced by the disallowed items − 10,575 − 5,425 Glenn's NOL for 2013 $1,775 This image is too large to be displayed in the current screen. Free h & r block tax filing Please click the link to view the image. Free h & r block tax filing Form 1040, page 1 This image is too large to be displayed in the current screen. Free h & r block tax filing Please click the link to view the image. Free h & r block tax filing Form 1040, page 2 This image is too large to be displayed in the current screen. Free h & r block tax filing Please click the link to view the image. Free h & r block tax filing Form 1045, page 2 When To Use an NOL Generally, if you have an NOL for a tax year ending in 2013, you must carry back the entire amount of the NOL to the 2 tax years before the NOL year (the carryback period), and then carry forward any remaining NOL for up to 20 years after the NOL year (the carryforward period). Free h & r block tax filing You can, however, choose not to carry back an NOL and only carry it forward. Free h & r block tax filing See Waiving the Carryback Period , later. Free h & r block tax filing You cannot deduct any part of the NOL remaining after the 20-year carryforward period. Free h & r block tax filing NOL year. Free h & r block tax filing   This is the year in which the NOL occurred. Free h & r block tax filing Exceptions to 2-Year Carryback Rule Eligible losses, farming losses, qualified disaster losses, and specified liability losses, all defined next, qualify for longer carryback periods. Free h & r block tax filing Eligible loss. Free h & r block tax filing   The carryback period for eligible losses is 3 years. Free h & r block tax filing Only the eligible loss portion of the NOL can be carried back 3 years. Free h & r block tax filing An eligible loss is any part of an NOL that: Is from a casualty or theft, or Is attributable to a federally declared disaster for a qualified small business or certain qualified farming businesses. Free h & r block tax filing Qualified small business. Free h & r block tax filing   A qualified small business is a sole proprietorship or a partnership that has average annual gross receipts (reduced by returns and allowances) of $5 million or less during the 3-year period ending with the tax year of the NOL. Free h & r block tax filing If the business did not exist for this entire 3-year period, use the period the business was in existence. Free h & r block tax filing   An eligible loss does not include a farming loss or a qualified disaster loss. Free h & r block tax filing Farming loss. Free h & r block tax filing   The carryback period for a farming loss is 5 years. Free h & r block tax filing Only the farming loss portion of the NOL can be carried back 5 years. Free h & r block tax filing A farming loss is the smaller of: The amount that would be the NOL for the tax year if only income and deductions attributable to farming businesses were taken into account, or The NOL for the tax year. Free h & r block tax filing Farming business. Free h & r block tax filing   A farming business is a trade or business involving cultivation of land or the raising or harvesting of any agricultural or horticultural commodity. Free h & r block tax filing A farming business can include operating a nursery or sod farm or raising or harvesting most ornamental trees or trees bearing fruit, nuts, or other crops. Free h & r block tax filing The raising, shearing, feeding, caring for, training, and management of animals is also considered a farming business. Free h & r block tax filing   A farming business does not include contract harvesting of an agricultural or horticultural commodity grown or raised by someone else. Free h & r block tax filing It also does not include a business in which you merely buy or sell plants or animals grown or raised entirely by someone else. Free h & r block tax filing Waiving the 5-year carryback. Free h & r block tax filing   You can choose to figure the carryback period for a farming loss without regard to the special 5-year carryback rule. Free h & r block tax filing To make this choice for 2013, attach to your 2013 income tax return filed by the due date (including extensions) a statement that you are choosing to treat any 2013 farming losses without regard to the special 5-year carryback rule. Free h & r block tax filing If you filed your original return on time but did not file the statement with it, you can make this choice on an amended return filed within 6 months after the due date of the return (excluding extensions). Free h & r block tax filing Attach an election statement to your amended return, and write “Filed pursuant to section 301. Free h & r block tax filing 9100-2” at the top of the statement. Free h & r block tax filing Once made, this choice is irrevocable. Free h & r block tax filing Qualified disaster loss. Free h & r block tax filing   The carryback period for a qualified disaster loss is 5 years. Free h & r block tax filing Only the qualified disaster loss portion of the NOL can be carried back 5 years. Free h & r block tax filing A qualified disaster loss is the smaller of: The sum of: Any losses attributable to a federally declared disaster and occurring before January 1, 2010, in the disaster area, plus Any allowable qualified disaster expenses (even if you did not choose to treat those expenses as deductions in the current year), or The NOL for the tax year. Free h & r block tax filing Qualified disaster expenses. Free h & r block tax filing   A qualified disaster expense is any capital expense paid or incurred in connection with a trade or business or with business-related property which is: For the abatement or control of hazardous substances that were released as a result of a federally declared disaster occurring before January 1, 2010, For the removal of debris from, or the demolition of structures on, real property which is business-related property damaged or destroyed as a result of a federally declared disaster occurring before January 1, 2010, or For the repair of business-related property damaged as a result of a federally declared disaster occurring before January 1, 2010. Free h & r block tax filing Business-related property is property held for use in a trade or business, property held for the production of income, or inventory property. Free h & r block tax filing Note. Free h & r block tax filing Section 198A allows taxpayers to treat certain capital expenses (qualified disaster expenses) as deductions in the year the expenses were paid or incurred. Free h & r block tax filing Excluded losses. Free h & r block tax filing   A qualified disaster loss does not include any losses from property used in connection with any private or commercial golf course, country club, massage parlor, hot tub facility, suntan facility, or any store for which the principal business is the sale of alcoholic beverages for consumption off premises. Free h & r block tax filing   A qualified disaster loss also does not include any losses from any gambling or animal racing property. Free h & r block tax filing Gambling or animal racing property is any equipment, furniture, software, or other property used directly in connection with gambling, the racing of animals, or the on-site viewing of such racing, and the portion of any real property (determined by square footage) that is dedicated to gambling, the racing of animals, or the on-site viewing of such racing, unless this portion is less than 100 square feet. Free h & r block tax filing Specified liability loss. Free h & r block tax filing   The carryback period for a specified liability loss is 10 years. Free h & r block tax filing Only the specified liability loss portion of the NOL can be carried back 10 years. Free h & r block tax filing Generally, a specified liability loss is a loss arising from: Product liability and expenses incurred in the investigation or settlement of, or opposition to, product liability claims, or An act (or failure to act) that occurred at least 3 years before the beginning of the loss year and resulted in a liability under a federal or state law requiring: Reclamation of land, Dismantling of a drilling platform, Remediation of environmental contamination, or Payment under any workers compensation act. Free h & r block tax filing   Any loss from a liability arising from (1) through (4) above can be taken into account as a specified liability loss only if you used an accrual method of accounting throughout the period in which the act (or failure to act) occurred. Free h & r block tax filing For details, see section 172(f). Free h & r block tax filing Waiving the 10-year carryback. Free h & r block tax filing   You can choose to figure the carryback period for a specified liability loss without regard to the special 10-year carryback rule. Free h & r block tax filing To make this choice for 2013 attach to your 2013 income tax return filed by the due date (including extensions) a statement that you are choosing to treat any 2013 specified liability losses without regard to the special 10-year carryback rule. Free h & r block tax filing If you filed your original return on time but did not file the statement with it, you can make this choice on an amended return filed within 6 months after the due date of the return (excluding extensions). Free h & r block tax filing Attach a statement to your amended return and write “Filed pursuant to section 301. Free h & r block tax filing 9100-2” at the top of the statement. Free h & r block tax filing Once made, this choice is irrevocable. Free h & r block tax filing Waiving the Carryback Period You can choose not to carry back your NOL. Free h & r block tax filing If you make this choice, then you can use your NOL only in the 20-year carryforward period. Free h & r block tax filing (This choice means you also choose not to carry back any alternative tax NOL. Free h & r block tax filing ) To make this choice, attach a statement to your original return filed by the due date (including extensions) for the NOL year. Free h & r block tax filing This statement must show that you are choosing to waive the carryback period under section 172(b)(3). Free h & r block tax filing If you filed your original return on time but did not file the statement with it, you can make this choice on an amended return filed within 6 months of the due date of the return (excluding extensions). Free h & r block tax filing Attach a statement to your amended return, and write “Filed pursuant to section 301. Free h & r block tax filing 9100-2” at the top of the statement. Free h & r block tax filing Once you choose to waive the carryback period, it generally is irrevocable. Free h & r block tax filing If you choose to waive the carryback period for more than one NOL, you must make a separate choice and attach a separate statement for each NOL year. Free h & r block tax filing If you do not file this statement on time, you cannot waive the carryback period. Free h & r block tax filing How To Carry an NOL Back or Forward If you choose to carry back the NOL, you must first carry the entire NOL to the earliest carryback year. Free h & r block tax filing If your NOL is not used up, you can carry the rest to the next earliest carryback year, and so on. Free h & r block tax filing If you waive the carryback period or do not use up the NOL in the carryback period, carry forward what remains of the NOL to the 20 tax years following the NOL year. Free h & r block tax filing Start by carrying it to the first tax year after the NOL year. Free h & r block tax filing If you do not use it up, carry the unused part to the next year. Free h & r block tax filing Continue to carry any unused part of the NOL forward until the NOL is used up or you complete the 20-year carryforward period. Free h & r block tax filing Example 1. Free h & r block tax filing You started your business as a sole proprietor in 2013 and had a $42,000 NOL for the year. Free h & r block tax filing No part of the NOL qualifies for the 3-year, 5-year, or 10-year carryback. Free h & r block tax filing You begin using your NOL in 2011, the second year before the NOL year, as shown in the following chart. Free h & r block tax filing Year   Carryback/  Carryover Unused  Loss 2011 $42,000 $40,000 2012 40,000 37,000 2013 (NOL year)     2014 37,000 31,500 2015 31,500 22,500 2016 22,500 12,700 2017 12,700 4,000 2018 4,000 -0- If your loss were larger, you could carry it forward until the year 2033. Free h & r block tax filing If you still had an unused 2013 carryforward after the year 2033, you would not be allowed to deduct it. Free h & r block tax filing Example 2. Free h & r block tax filing Assume the same facts as in Example 1 , except that $4,000 of the NOL is attributable to a casualty loss and this loss qualifies for a 3-year carryback period. Free h & r block tax filing You begin using the $4,000 in 2010. Free h & r block tax filing As shown in the following chart, $3,000 of this NOL is used in 2010. Free h & r block tax filing The remaining $1,000 is carried to 2011 with the $38,000 NOL that you must begin using in 2011. Free h & r block tax filing Year   Carryback/  Carryover Unused  Loss 2010 $4,000 $1,000 2011 39,000 37,000 2012 37,000 34,000 2013 (NOL year)     2014 34,000 28,500 2015 28,500 19,500 2016 19,500 9,700 2017 9,700 1,000 2018 1,000 -0- How To Claim an NOL Deduction If you have not already carried the NOL to an earlier year, your NOL deduction is the total NOL. Free h & r block tax filing If you carried the NOL to an earlier year, your NOL deduction is the carried over NOL minus the NOL amount you used in the earlier year or years. Free h & r block tax filing If you carry more than one NOL to the same year, your NOL deduction is the total of these carrybacks and carryovers. Free h & r block tax filing NOL resulting in no taxable income. Free h & r block tax filing   If your NOL is more than the taxable income of the year you carry it to (figured before deducting the NOL), you generally will have an NOL carryover to the next year. Free h & r block tax filing See How To Figure an NOL Carryover , later, to determine how much NOL you have used and how much you carry to the next year. Free h & r block tax filing Deducting a Carryback If you carry back your NOL, you can use either Form 1045 or Form 1040X. Free h & r block tax filing You can get your refund faster by using Form 1045, but you have a shorter time to file it. Free h & r block tax filing You can use Form 1045 to apply an NOL to all carryback years. Free h & r block tax filing If you use Form 1040X, you must use a separate Form 1040X for each carryback year to which you apply the NOL. Free h & r block tax filing Estates and trusts that do not file Form 1045 must file an amended Form 1041 (instead of Form 1040X) for each carryback year to which NOLs are applied. Free h & r block tax filing Use a copy of the appropriate year's Form 1041, check the “Amended return” box, and follow the Form 1041 instructions for amended returns. Free h & r block tax filing Include the NOL deduction with other deductions not subject to the 2% limit (line 15a). Free h & r block tax filing Also, see the special procedures for filing an amended return due to an NOL carryback, explained under Form 1040X , later. Free h & r block tax filing Form 1045. Free h & r block tax filing   You can apply for a quick refund by filing Form 1045. Free h & r block tax filing This form results in a tentative adjustment of tax in the carryback year. Free h & r block tax filing See the Illustrated Form 1045 . Free h & r block tax filing at the end of this discussion. Free h & r block tax filing   If the IRS refunds or credits an amount to you from Form 1045 and later determines that the refund or credit is too much, the IRS may assess and collect the excess immediately. Free h & r block tax filing   Generally, you must file Form 1045 on or after the date you file your tax return for the NOL year, but not later than one year after the end of the NOL year. Free h & r block tax filing If the last day of the NOL year falls on a Saturday, Sunday, or holiday, the form will be considered timely if postmarked on the next business day. Free h & r block tax filing For example, if you are a calendar year taxpayer with a carryback from 2013 to 2011, you must file Form 1045 on or after the date you file your tax return for 2013, but no later than December 31, 2014. Free h & r block tax filing Form 1040X. Free h & r block tax filing   If you do not file Form 1045, you can file Form 1040X to get a refund of tax because of an NOL carryback. Free h & r block tax filing File Form 1040X within 3 years after the due date, including extensions, for filing the return for the NOL year. Free h & r block tax filing For example, if you are a calendar year taxpayer and filed your 2011 return by the April 15, 2012, due date, you must file a claim for refund of 2008 tax because of an NOL carryback from 2011 by April 15, 2015. Free h & r block tax filing   Attach a computation of your NOL using Form 1045, Schedule A, and, if it applies, your NOL carryover using Form 1045, Schedule B, discussed later . Free h & r block tax filing Refiguring your tax. Free h & r block tax filing   To refigure your total tax liability for a carryback year, first refigure your adjusted gross income for that year. Free h & r block tax filing (On Form 1045, use lines 10 and 11 and the “After carryback” column for the applicable carryback year. Free h & r block tax filing ) Use your adjusted gross income after applying the NOL deduction to refigure income or deduction items that are based on, or limited to, a percentage of your adjusted gross income. Free h & r block tax filing Refigure the following items. Free h & r block tax filing The special allowance for passive activity losses from rental real estate activities. Free h & r block tax filing Taxable social security and tier 1 railroad retirement benefits. Free h & r block tax filing IRA deductions. Free h & r block tax filing Excludable savings bond interest. Free h & r block tax filing Excludable employer-provided adoption benefits. Free h & r block tax filing The student loan interest deduction. Free h & r block tax filing The tuition and fees deduction. Free h & r block tax filing   If more than one of these items apply, refigure them in the order listed above, using your adjusted gross income after applying the NOL deduction and any previous item. Free h & r block tax filing (Enter your NOL deduction on Form 1045, line 10. Free h & r block tax filing On line 11, using the “After carryback” column, enter your adjusted gross income refigured after applying the NOL deduction and after refiguring any above items. Free h & r block tax filing )   Next, refigure your taxable income. Free h & r block tax filing (On Form 1045, use lines 12 through 15 and the “After carryback” column. Free h & r block tax filing ) Use your refigured adjusted gross income (Form 1045, line 11, using the “After carryback” column) to refigure certain deductions and other items that are based on or limited to a percentage of your adjusted gross income. Free h & r block tax filing Refigure the following items. Free h & r block tax filing The itemized deduction for medical expenses. Free h & r block tax filing The itemized deduction for qualified mortgage insurance premiums. Free h & r block tax filing The itemized deduction for casualty losses. Free h & r block tax filing Miscellaneous itemized deductions subject to the 2% limit. Free h & r block tax filing The overall limit on itemized deductions (do not apply to carryback years beginning after December 31, 2009). Free h & r block tax filing The phaseout of the deduction for exemptions (do not apply to carryback years beginning after December 31, 2009). Free h & r block tax filing Qualified motor vehicle tax (do not apply to carryback years beginning after December 31, 2009). Free h & r block tax filing    Do not refigure the itemized deduction for charitable contributions. Free h & r block tax filing   Finally, use your refigured taxable income (Form 1045, line 15, using the “After carryback” column) to refigure your total tax liability. Free h & r block tax filing Refigure your income tax, your alternative minimum tax, and any credits that are based on or limited by your adjusted gross income (AGI), modified adjusted gross income (MAGI), or tax liability. Free h & r block tax filing (On Form 1045, use lines 16 through 25, and the “After carryback” column. Free h & r block tax filing ) The earned income credit, for example, may be affected by changes to adjusted gross income or the amount of tax (or both) and, therefore, must be recomputed. Free h & r block tax filing If you become eligible for a credit because of the carryback, complete the form for that specific credit (such as the EIC Worksheet) for that year. Free h & r block tax filing   While it is necessary to refigure your income tax, alternative minimum tax, and credits, do not refigure your self-employment tax. Free h & r block tax filing Deducting a Carryforward If you carry forward your NOL to a tax year after the NOL year, list your NOL deduction as a negative figure on the “Other income” line of Form 1040 or Form 1040NR (line 21 for 2013). Free h & r block tax filing Estates and trusts include an NOL deduction on Form 1041 with other deductions not subject to the 2% limit (line 15a for 2013). Free h & r block tax filing You must attach a statement that shows all the important facts about the NOL. Free h & r block tax filing Your statement should include a computation showing how you figured the NOL deduction. Free h & r block tax filing If you deduct more than one NOL in the same year, your statement must cover each of them. Free h & r block tax filing Change in Marital Status If you and your spouse were not married to each other in all years involved in figuring NOL carrybacks and carryovers, only the spouse who had the loss can take the NOL deduction. Free h & r block tax filing If you file a joint return, the NOL deduction is limited to the income of that spouse. Free h & r block tax filing For example, if your marital status changes because of death or divorce, and in a later year you have an NOL, you can carry back that loss only to the part of the income reported on the joint return (filed with your former spouse) that was related to your taxable income. Free h & r block tax filing After you deduct the NOL in the carryback year, the joint rates apply to the resulting taxable income. Free h & r block tax filing Refund limit. Free h & r block tax filing   If you are not married in the NOL year (or are married to a different spouse), and in the carryback year you were married and filed a joint return, your refund for the overpaid joint tax may be limited. Free h & r block tax filing You can claim a refund for the difference between your share of the refigured tax and your contribution toward the tax paid on the joint return. Free h & r block tax filing The refund cannot be more than the joint overpayment. Free h & r block tax filing Attach a statement showing how you figured your refund. Free h & r block tax filing Figuring your share of a joint tax liability. Free h & r block tax filing   There are five steps for figuring your share of the refigured joint tax liability. Free h & r block tax filing Figure your total tax as though you had filed as married filing separately. Free h & r block tax filing Figure your spouse's total tax as though your spouse had also filed as married filing separately. Free h & r block tax filing Add the amounts in (1) and (2). Free h & r block tax filing Divide the amount in (1) by the amount in (3). Free h & r block tax filing Multiply the refigured tax on your joint return by the amount figured in (4). Free h & r block tax filing This is your share of the joint tax liability. Free h & r block tax filing Figuring your contribution toward tax paid. Free h & r block tax filing   Unless you have an agreement or clear evidence of each spouse's contributions toward the payment of the joint tax liability, figure your contribution by adding the tax withheld on your wages and your share of joint estimated tax payments or tax paid with the return. Free h & r block tax filing If the original return for the carryback year resulted in an overpayment, reduce your contribution by your share of the tax refund. Free h & r block tax filing Figure your share of a joint payment or refund by the same method used in figuring your share of the joint tax liability. Free h & r block tax filing Use your taxable income as originally reported on the joint return in steps (1) and (2) above, and substitute the joint payment or refund for the refigured joint tax in step (5). Free h & r block tax filing Change in Filing Status If you and your spouse were married and filed a joint return for each year involved in figuring NOL carrybacks and carryovers, figure the NOL deduction on a joint return as you would for an individual. Free h & r block tax filing However, treat the NOL deduction as a joint NOL. Free h & r block tax filing If you and your spouse were married and filed separate returns for each year involved in figuring NOL carrybacks and carryovers, the spouse who sustained the loss may take the NOL deduction on a separate return. Free h & r block tax filing Special rules apply for figuring the NOL carrybacks and carryovers of married people whose filing status changes for any tax year involved in figuring an NOL carryback or carryover. Free h & r block tax filing Separate to joint return. Free h & r block tax filing   If you and your spouse file a joint return for a carryback or carryforward year, and were married but filed separate returns for any of the tax years involved in figuring the NOL carryback or carryover, treat the separate carryback or carryover as a joint carryback or carryover. Free h & r block tax filing Joint to separate returns. Free h & r block tax filing   If you and your spouse file separate returns for a carryback or carryforward year, but filed a joint return for any or all of the tax years involved in figuring the NOL carryover, figure each of your carryovers separately. Free h & r block tax filing Joint return in NOL year. Free h & r block tax filing   Figure each spouse's share of the joint NOL through the following steps. Free h & r block tax filing Figure each spouse's NOL as if he or she filed a separate return. Free h & r block tax filing See How To Figure an NOL , earlier. Free h & r block tax filing If only one spouse has an NOL, stop here. Free h & r block tax filing All of the joint NOL is that spouse's NOL. Free h & r block tax filing If both spouses have an NOL, multiply the joint NOL by a fraction, the numerator of which is spouse A's NOL figured in (1) and the denominator of which is the total of the spouses' NOLs figured in (1). Free h & r block tax filing The result is spouse A's share of the joint NOL. Free h & r block tax filing The rest of the joint NOL is spouse B's share. Free h & r block tax filing Example 1. Free h & r block tax filing Mark and Nancy are married and file a joint return for 2013. Free h & r block tax filing They have an NOL of $5,000. Free h & r block tax filing They carry the NOL back to 2011, a year in which Mark and Nancy filed separate returns. Free h & r block tax filing Figured separately, Nancy's 2013 deductions were more than her income, and Mark's income was more than his deductions. Free h & r block tax filing Mark does not have any NOL to carry back. Free h & r block tax filing Nancy can carry back the entire $5,000 NOL to her 2011 separate return. Free h & r block tax filing Example 2. Free h & r block tax filing Assume the same facts as in Example 1 , except that both Mark and Nancy had deductions in 2013 that were more than their income. Free h & r block tax filing Figured separately, his NOL is $1,800 and her NOL is $3,000. Free h & r block tax filing The sum of their separate NOLs ($4,800) is less than their $5,000 joint NOL because his deductions included a $200 net capital loss that is not allowed in figuring his separate NOL. Free h & r block tax filing The loss is allowed in figuring their joint NOL because it was offset by Nancy's capital gains. Free h & r block tax filing Mark's share of their $5,000 joint NOL is $1,875 ($5,000 × $1,800/$4,800) and Nancy's is $3,125 ($5,000 − $1,875). Free h & r block tax filing Joint return in previous carryback or carryforward year. Free h & r block tax filing   If only one spouse had an NOL deduction on the previous year's joint return, all of the joint carryover is that spouse's carryover. Free h & r block tax filing If both spouses had an NOL deduction (including separate carryovers of a joint NOL, figured as explained in the previous discussion ), figure each spouse's share of the joint carryover through the following steps. Free h & r block tax filing Figure each spouse's modified taxable income as if he or she filed a separate return. Free h & r block tax filing See Modified taxable income under How To Figure an NOL Carryover , later. Free h & r block tax filing Multiply the joint modified taxable income you used to figure the joint carryover by a fraction, the numerator of which is spouse A's modified taxable income figured in (1) and the denominator of which is the total of the spouses' modified taxable incomes figured in (1). Free h & r block tax filing This is spouse A's share of the joint modified taxable income. Free h & r block tax filing Subtract the amount figured in (2) from the joint modified taxable income. Free h & r block tax filing This is spouse B's share of the joint modified taxable income. Free h & r block tax filing Reduce the amount figured in (3), but not below zero, by spouse B's NOL deduction. Free h & r block tax filing Add the amounts figured in (2) and (4). Free h & r block tax filing Subtract the amount figured in (5) from spouse A's NOL deduction. Free h & r block tax filing This is spouse A's share of the joint carryover. Free h & r block tax filing The rest of the joint carryover is spouse B's share. Free h & r block tax filing Example. Free h & r block tax filing Sam and Wanda filed a joint return for 2011 and separate returns for 2012 and 2013. Free h & r block tax filing In 2013, Sam had an NOL of $18,000 and Wanda had an NOL of $2,000. Free h & r block tax filing They choose to carry back both NOLs 2 years to their 2011 joint return and claim a $20,000 NOL deduction. Free h & r block tax filing Their joint modified taxable income (MTI) for 2011 is $15,000, and their joint NOL carryover to 2012 is $5,000 ($20,000 – $15,000). Free h & r block tax filing Sam and Wanda each figure their separate MTI for 2011 as if they had filed separate returns. Free h & r block tax filing Then they figure their shares of the $5,000 carryover as follows. Free h & r block tax filing Step 1. Free h & r block tax filing   Sam's separate MTI $9,000 Wanda's separate MTI + 3,000 Total MTI $12,000 Step 2. Free h & r block tax filing   Joint MTI $15,000 Sam's MTI ÷ total MTI ($9,000 ÷ $12,000) × . Free h & r block tax filing 75 Sam's share of joint MTI $11,250 Step 3. Free h & r block tax filing   Joint MTI $15,000 Sam's share of joint MTI − 11,250 Wanda's share of joint MTI $3,750 Step 4. Free h & r block tax filing   Wanda's share of joint MTI $3,750 Wanda's NOL deduction − 2,000 Wanda's remaining share $1,750 Step 5. Free h & r block tax filing   Sam's share of joint MTI $11,250 Wanda's remaining share + 1,750 Joint MTI to be offset $13,000 Step 6. Free h & r block tax filing   Sam's NOL deduction $18,000 Joint MTI to be offset − 13,000 Sam's carryover to 2012 $5,000 Joint carryover to 2012 $5,000 Sam's carryover − 5,000 Wanda's carryover to 2012 $-0- Wanda's $2,000 NOL deduction offsets $2,000 of her $3,750 share of the joint modified taxable income and is completely used up. Free h & r block tax filing She has no carryover to 2012. Free h & r block tax filing Sam's $18,000 NOL deduction offsets all of his $11,250 share of joint modified taxable income and the remaining $1,750 of Wanda's share. Free h & r block tax filing His carryover to 2012 is $5,000. Free h & r block tax filing Illustrated Form 1045 The following example illustrates how to use Form 1045 to claim an NOL deduction in a carryback year. Free h & r block tax filing It includes a filled-in page 1 of Form 1045. Free h & r block tax filing Example. Free h & r block tax filing Martha Sanders is a self-employed contractor. Free h & r block tax filing Martha's 2013 deductions are more than her 2013 income because of a business loss. Free h & r block tax filing She uses Form 1045 to carry back her NOL 2 years and claim an NOL deduction in 2011. Free h & r block tax filing Her filing status in both years was single. Free h & r block tax filing See the filled-in Form 1045 later. Free h & r block tax filing Martha figures her 2013 NOL on Form 1045, Schedule A (not shown). Free h & r block tax filing (For an example using Form 1045, Schedule A, see Illustrated Form 1045, Schedule A under How To Figure an NOL , earlier. Free h & r block tax filing ) She enters the $10,000 NOL from Form 1045, Schedule A, line 25, on Form 1045, line 1a. Free h & r block tax filing Martha completes lines 10 through 25, using the “Before carryback” column under the column for the second preceding tax year ended 12/31/11 on page 1 of Form 1045 using the following amounts from her 2011 return. Free h & r block tax filing 2011 Adjusted gross income $50,000 Itemized deductions:     Medical expenses [$6,000 − ($50,000 × 7. Free h & r block tax filing 5%)] $2,250   State income tax + 2,000   Real estate tax + 4,000   Home mortgage interest + 5,000   Total itemized deductions $13,250 Exemption $3,700 Income tax $4,550 Self-employment tax $6,120   Martha refigures her taxable income for 2011 after carrying back her 2013 NOL as follows: 2011 Adjusted gross income $50,000 Less:     NOL from 2013 −10,000 2011 Adjusted gross income after carryback $40,000 Less:     Itemized deductions:     Medical expenses [$6,000 − ($40,000 × 7. Free h & r block tax filing 5%)] $3,000   State income tax + 2,000   Real estate tax + 4,000   Home mortgage interest + 5,000   Total itemized deductions −14,000 Less:     Exemption − 3,700 2011 Taxable income after carryback $22,300 Martha then completes lines 10 through 25, using the “After carryback” column under the column for the second preceding tax year ended 12/31/11. Free h & r block tax filing On line 10, Martha enters her $10,000 NOL deduction. Free h & r block tax filing Her new adjusted gross income on line 11 is $40,000 ($50,000 − $10,000). Free h & r block tax filing To complete line 12, she must refigure her medical expense deduction using her new adjusted gross income. Free h & r block tax filing Her refigured medical expense deduction is $3,000 [$6,000 − ($40,000 × 7. Free h & r block tax filing 5%)]. Free h & r block tax filing This increases her total itemized deductions to $14,000 [$13,250 + ($3,000 − $2,250)]. Free h & r block tax filing Martha uses her refigured taxable income ($22,300) from line 15, and the tax tables in her 2011 Form 1040 instructions to find her income tax. Free h & r block tax filing She enters the new amount, $2,924, on line 16, and her new total tax liability, $9,044, on line 25. Free h & r block tax filing Martha used up her $10,000 NOL in 2011 so she does not complete a column for the first preceding tax year ended 12/31/2012. Free h & r block tax filing The decrease in tax because of her NOL deduction (line 27) is $1,612. Free h & r block tax filing Martha files Form 1045 after filing her 2013 return, but no later than December 31, 2014. Free h & r block tax filing She mails it to the Internal Revenue Service Center for the place where she lives as shown in the 2013 instructions for Form 1040 and attaches a copy of her 2013 return (including the applicable forms and schedules). Free h & r block tax filing This image is too large to be displayed in the current screen. Free h & r block tax filing Please click the link to view the image. Free h & r block tax filing Form 1045, page 1 How To Figure an NOL Carryover If your NOL is more than your taxable income for the year to which you carry it (figured before deducting the NOL), you may have an NOL carryover. Free h & r block tax filing You must make certain modifications to your taxable income to determine how much NOL you will use up in that year and how much you can carry over to the next tax year. Free h & r block tax filing Your carryover is the excess of your NOL deduction over your modified taxable income for the carryback or carryforward year. Free h & r block tax filing If your NOL deduction includes more than one NOL, apply the NOLs against your modified taxable income in the same order in which you incurred them, starting with the earliest. Free h & r block tax filing Modified taxable income. Free h & r block tax filing   Your modified taxable income is your taxable income figured with the following changes. Free h & r block tax filing You cannot claim an NOL deduction for the NOL carryover you are figuring or for any later NOL. Free h & r block tax filing You cannot claim a deduction for capital losses in excess of your capital gains. Free h & r block tax filing Also, you must increase your taxable income by the amount of any section 1202 exclusion. Free h & r block tax filing You cannot claim the domestic production activities deduction. Free h & r block tax filing You cannot claim a deduction for your exemptions for yourself, your spouse, or dependents. Free h & r block tax filing You must figure any item affected by the amount of your adjusted gross income after making the changes in (1), (2), and (3), above, and certain other changes to your adjusted gross income that result from (1), (2), and (3). Free h & r block tax filing This includes income and deduction items used to figure adjusted gross income (for example, IRA deductions), as well as certain itemized deductions. Free h & r block tax filing To figure a charitable contribution deduction, do not include deductions for NOL carrybacks in the change in (1) but do include deductions for NOL carryforwards from tax years before the NOL year. Free h & r block tax filing   Your taxable income as modified cannot be less than zero. Free h & r block tax filing Form 1045, Schedule B. Free h & r block tax filing   You can use Form 1045, Schedule B, to figure your modified taxable income for carryback years and your carryover from each of those years. Free h & r block tax filing Do not use Form 1045, Schedule B, for a carryforward year. Free h & r block tax filing If your 2013 return includes an NOL deduction from an NOL year before 2013 that reduced your taxable income to zero (to less than zero, if an estate or trust), see NOL Carryover From 2013 to 2014 , later. Free h & r block tax filing Illustrated Form 1045, Schedule B The following example illustrates how to figure an NOL carryover from a carryback year. Free h & r block tax filing It includes a filled-in Form 1045, Schedule B. Free h & r block tax filing Example. Free h & r block tax filing Ida Brown runs a small clothing shop. Free h & r block tax filing In 2013, she has an NOL of $36,000 that she carries back to 2011. Free h & r block tax filing She has no other carrybacks or carryforwards to 2011. Free h & r block tax filing Ida's adjusted gross income in 2011 was $35,000, consisting of her salary of $36,000 minus a $1,000 capital loss deduction. Free h & r block tax filing She is single and claimed only one personal exemption of $3,700. Free h & r block tax filing During that year, she gave $1,450 in charitable contributions. Free h & r block tax filing Her medical expenses were $3,000. Free h & r block tax filing She also deducted $1,650 in taxes and $3,125 in home mortgage interest. Free h & r block tax filing Her deduction for charitable contributions was not limited because her contributions, $1,450, were less than 50% of her adjusted gross income. Free h & r block tax filing The deduction for medical expenses was limited to expenses over 7. Free h & r block tax filing 5% of adjusted gross income (. Free h & r block tax filing 075 × $35,000 = $2,625; $3,000 − $2,625 = $375). Free h & r block tax filing The deductions for taxes and home mortgage interest were not subject to any limits. Free h & r block tax filing She was able to claim $6,600 ($1,450 + $375 + $1,650 + $3,125) in itemized deductions and a personal exemption deduction of $3,700 for 2011. Free h & r block tax filing She had no other deductions in 2011 (except the NOL deduction). Free h & r block tax filing Her taxable income (figured without the NOL deduction) for the year was $24,700. Free h & r block tax filing Ida's adjusted gross income in 2012 was $9,325, consisting of net business income from the clothing shop of $12,325 and a net capital loss of $3,000. Free h & r block tax filing She did not itemize her deductions in 2012. Free h & r block tax filing She deducted the standard deduction of $5,950 and the personal exemption deduction of $3,800. Free h & r block tax filing She had no other deductions in 2012 (other than the NOL deduction). Free h & r block tax filing Her taxable income, therefore, was ($425). Free h & r block tax filing Ida's $36,000 carryback will result in her having 2011 taxable income of zero. Free h & r block tax filing She then completes the column for the second preceding tax year ended 12/31/11 on Form 1045, Schedule B, to figure how much of her NOL she uses up in 2011 and how much she can carry over to 2012. Free h & r block tax filing She completes the column for the first preceding tax year ended 12/31/12. Free h & r block tax filing See the illustrated Form 1045, Schedule B , shown later. Free h & r block tax filing Column 1, line 1. Free h & r block tax filing Ida enters $36,000, her 2013 net operating loss, on line 1. Free h & r block tax filing Column 1, line 2. Free h & r block tax filing She enters $24,700, her 2011 taxable income (figured without the NOL deduction), on line 2. Free h & r block tax filing Column 1, line 3. Free h & r block tax filing Ida enters her net capital loss deduction of $1,000 on line 3. Free h & r block tax filing Column 1, lines 4 and 5. Free h & r block tax filing Ida had no section 1202 exclusion or domestic production activities deduction in 2011. Free h & r block tax filing She enters zero on lines 4 and 5. Free h & r block tax filing Column 1, line 6. Free h & r block tax filing Although Ida's entry on line 3 modifies her adjusted gross income, that does not affect any other items included in her adjusted gross income. Free h & r block tax filing Ida enters zero on line 6. Free h & r block tax filing Column 1, line 7. Free h & r block tax filing Ida had itemized deductions and entered $1,000 on line 3, so she completes lines 11 through 38 to figure her adjustment to itemized deductions. Free h & r block tax filing On line 7, she enters the total adjustment from line 38. Free h & r block tax filing Column 1, line 8. Free h & r block tax filing Ida enters the deduction for her personal exemption of $3,700 for 2011. Free h & r block tax filing Column 1, line 9. Free h & r block tax filing After combining lines 2 through 8, Ida's modified taxable income is $29,475. Free h & r block tax filing Column 1, line 10. Free h & r block tax filing Ida figures her carryover to 2012 by subtracting her modified taxable income (line 9) from her NOL deduction (line 1). Free h & r block tax filing She enters the $6,525 carryover on line 10. Free h & r block tax filing She also enters the $6,525 as her NOL deduction for 2012 on Form 1045, page 1, line 10, in the “After carryback” column under the column for the first preceding tax year ended 12/31/12. Free h & r block tax filing (For an illustrated example of page 1 of Form 1045, see Illustrated Form 1045 under How To Claim an NOL Deduction , earlier. Free h & r block tax filing ) Next, Ida completes column 2 for the first preceding tax year ended 12/31/12. Free h & r block tax filing Column 1, line 11. Free h & r block tax filing Ida's adjusted gross income for 2011 was $35,000. Free h & r block tax filing Column 1, line 12. Free h & r block tax filing She adds lines 3 through 6 and enters $1,000 on line 12. Free h & r block tax filing (This is her net capital loss deduction added back, which modifies her adjusted gross income. Free h & r block tax filing ) Column 1, line 13. Free h & r block tax filing Her modified adjusted gross income for 2011 is now $36,000. Free h & r block tax filing Column 1, line 14. Free h & r block tax filing On her 2011 tax return, she deducted $375 as medical expenses. Free h & r block tax filing Column 1, line 15. Free h & r block tax filing Her actual medical expenses were $3,000. Free h & r block tax filing Column 1, line 16. Free h & r block tax filing She multiplies her modified adjusted gross income, $36,000, by . Free h & r block tax filing 075. Free h & r block tax filing She enters $2,700 on line 16. Free h & r block tax filing Column 1, line 17. Free h & r block tax filing She substracts $2,700 from her actual medical expenses, $3,000. Free h & r block tax filing She enters $300 on line 17. Free h & r block tax filing This is her modified medical deduction. Free h & r block tax filing Column 1, line 18. Free h & r block tax filing The difference between her medical deduction and her modified medical deduction is $75. Free h & r block tax filing She enters this on line 18. Free h & r block tax filing Column 1, lines 19 through 21. Free h & r block tax filing Ida had no deduction for qualified mortgage insurance premiums in 2011. Free h & r block tax filing She skips lines 19 and 20 and enters zero on line 21. Free h & r block tax filing Column 1, line 22. Free h & r block tax filing She enters her modified adjusted gross income of $36,000 on line 22. Free h & r block tax filing Column 1, line 23. Free h & r block tax filing She had no other carrybacks to 2011 and enters zero on line 23. Free h & r block tax filing Column 1, line 24. Free h & r block tax filing Her modified adjusted gross income remains $36,000. Free h & r block tax filing Column 1, line 25. Free h & r block tax filing Her actual contributions for 2011 were $1,450, which she enters on line 25. Free h & r block tax filing Column 1, line 26. Free h & r block tax filing She now refigures her charitable contributions based on her modified adjusted gross income. Free h & r block tax filing Her contributions are well below the 50% limit, so she enters $1,450 on line 26. Free h & r block tax filing Column 1, line 27. Free h & r block tax filing The difference is zero. Free h & r block tax filing Column 1, lines 28 through 37. Free h & r block tax filing Ida had no casualty losses or deductions for miscellaneous items in 2011. Free h & r block tax filing She skips lines 28 through 31 and lines 33 through 36. Free h & r block tax filing Ida enters zero on lines 32 and 37. Free h & r block tax filing Column 1, line 38. Free h & r block tax filing She combines lines 18, 21, 27, 32, and 37 and enters $75 on line 38. Free h & r block tax filing She carries this figure to line 7. Free h & r block tax filing Column 2, line 1. Free h & r block tax filing Ida enters $6,525, the carryback of her 2013 NOL to 2012, from column 1, line 10, on line 1. Free h & r block tax filing Column 2, line 2. Free h & r block tax filing She enters ($425), her 2012 taxable income, on line 2. Free h & r block tax filing Column 2, line 3. Free h & r block tax filing Ida enters her net capital loss deduction of $3,000 on line 3. Free h & r block tax filing Column 2, lines 4 and 5. Free h & r block tax filing Ida had no section 1202 exclusion or domestic production activities deduction in 2012. Free h & r block tax filing She enters zero on lines 4 and 5. Free h & r block tax filing Column 2, line 6. Free h & r block tax filing Although Ida's entry on line 3 modifies her adjusted gross income, that does not affect any other items included in her adjusted gross income. Free h & r block tax filing Ida enters zero on line 6. Free h & r block tax filing Column 2, line 7. Free h & r block tax filing Because Ida did not itemize deductions on her 2012 tax return, she enters zero on line 7. Free h & r block tax filing Column 2, line 8. Free h & r block tax filing Ida enters the deduction for her personal exemption of $3,800 for 2012. Free h & r block tax filing Column 2, line 9. Free h & r block tax filing After combining lines 2 through 8, Ida's modified taxable income is $6,375. Free h & r block tax filing Column 2, line 10. Free h & r block tax filing Ida figures her carryforward to 2014 by subtracting her modified taxable income (line 9) from her NOL deduction (line 1). Free h & r block tax filing She enters the $150 carryover on line 10. Free h & r block tax filing This image is too large to be displayed in the current screen. Free h & r block tax filing Please click the link to view the image. Free h & r block tax filing Form 1045, page 3 This image is too large to be displayed in the current screen. Free h & r block tax filing Please click the link to view the image. Free h & r block tax filing Form 1045, page 4 NOL Carryover From 2013 to 2014 If you had an NOL deduction carried forward from a year prior to 2013 that resulted in your having taxable income on your 2013 return of zero (of less than zero, if an estate or trust), complete Table 1 , Worksheet for NOL Carryover From 2013 to 2014, on the following pages. Free h & r block tax filing It will help you figure your NOL to carry to 2014. Free h & r block tax filing Keep the worksheet for your records. Free h & r block tax filing Worksheet Instructions At the top of the worksheet, enter the NOL year for which you are figuring the carryover. Free h & r block tax filing More than one NOL. Free h & r block tax filing   If your 2013 NOL deduction includes amounts for more than one loss year, complete this worksheet only for one loss year. Free h & r block tax filing To determine which year, start with your earliest NOL and subtract each NOL separately from your taxable income figured without the NOL deduction. Free h & r block tax filing Complete this worksheet for the earliest NOL that results in your having taxable income below zero. Free h & r block tax filing Your NOL carryover to 2014 is the total of the amount on line 10 of the worksheet and all later NOL amounts. Free h & r block tax filing Example. Free h & r block tax filing Your taxable income for 2013 is $5,000 without your $9,000 NOL deduction. Free h & r block tax filing Your NOL deduction includes a $2,000 carryover from 2011 and a $7,000 carryover from 2012. Free h & r block tax filing Subtract your 2011 NOL of $2,000 from $5,000. Free h & r block tax filing This gives you taxable income of $3,000. Free h & r block tax filing Your 2011 NOL is now completely used up. Free h & r block tax filing Subtract your $7,000 2012 NOL from $3,000. Free h & r block tax filing This gives you taxable income of ($4,000). Free h & r block tax filing You now complete the worksheet for your 2012 NOL. Free h & r block tax filing Your NOL carryover to 2014 is the unused part of your 2012 NOL from line 10 of the worksheet. Free h & r block tax filing Line 2. Free h & r block tax filing   Treat your NOL deduction for the NOL year entered at the top of the worksheet and later years as a positive amount. Free h & r block tax filing Add it to your negative taxable income (figured without the NOL deduction). Free h & r block tax filing Enter the result on line 2. Free h & r block tax filing Line 6. Free h & r block tax filing   You must refigure the following income and deductions based on adjusted gross income. Free h & r block tax filing The special allowance for passive activity losses from rental real estate activities. Free h & r block tax filing Taxable social security and tier 1 railroad retirement benefits. Free h & r block tax filing IRA deductions. Free h & r block tax filing Excludable savings bond interest. Free h & r block tax filing Excludable employer-provided adoption benefits. Free h & r block tax filing The student loan interest deduction. Free h & r block tax filing The tuition and fees deduction. Free h & r block tax filing   If none of these items apply to you, enter zero on line 6. Free h & r block tax filing Otherwise, increase your adjusted gross income by the total of lines 3 through 5 and your NOL deduction for the NOL year entered at the top of the worksheet and later years. Free h & r block tax filing Using this increased adjusted gross income, refigure the items that apply, in the order listed above. Free h & r block tax filing Your adjustment for each item is the difference between the refigured amount and the amount included on your return. Free h & r block tax filing Combine the adjustments for previous items with your adjusted gross income before refiguring the next item. Free h & r block tax filing Keep a record of your computations. Free h & r block tax filing   Enter your total adjustments for the above items on line 6. Free h & r block tax filing Line 7. Free h & r block tax filing   Enter zero if you claimed the standard deduction or the amounts on lines 3 through 5 are zero. Free h & r block tax filing Otherwise, use lines 11 through 33 of the worksheet to figure the amount to enter on this line. Free h & r block tax filing Complete only those sections that apply to you. Free h & r block tax filing Estates and trusts. Free h & r block tax filing   Enter zero on line 7 if you did not claim any miscellaneous deductions on Form 1041, line 15c, or a casualty or theft loss. Free h & r block tax filing Otherwise, refigure these deductions by substituting modified adjusted gross income (see below ) for adjusted gross income. Free h & r block tax filing Subtract the recomputed deductions from those claimed on the return. Free h & r block tax filing Enter the result on line 7. Free h & r block tax filing Modified adjusted gross income. Free h & r block tax filing   To refigure miscellaneous itemized deductions of an estate or trust (Form 1041, line 15c), modified adjusted gross income is the total of the following amounts. Free h & r block tax filing The adjusted gross income on the return. Free h & r block tax filing The amounts from lines 3 through 5 of the worksheet. Free h & r block tax filing The exemption amount from Form 1041, line 20. Free h & r block tax filing The NOL deduction for the NOL year entered at the top of the worksheet and for later years. Free h & r block tax filing   To refigure the casualty and theft loss deduction of an estate or trust, modified adjusted gross income is the total of the following amounts. Free h & r block tax filing The adjusted gross income amount you used to figure the deduction claimed on the return. Free h & r block tax filing The amounts from lines 3 through 5 of the worksheet. Free h & r block tax filing The NOL deduction for the NOL year entered at the top of the worksheet and for later years. Free h & r block tax filing Line 11. Free h & r block tax filing   Treat your NOL deduction for the NOL year entered at the top of the worksheet and for later years as a positive amount. Free h & r block tax filing Add it to your adjusted gross income. Free h & r block tax filing Enter the result on line 11. Free h & r block tax filing Line 20. Free h & r block tax filing   Is your modified adjusted gross income from line 13 of this worksheet more than $100,000 ($50,000 if married filing separately)?   □ Yes. Free h & r block tax filing Your deduction is limited. Free h & r block tax filing Refigure your deduction using the Mortgage Insurance Premiums Deduction Worksheet in the 2013 Instructions for Form 1045. Free h & r block tax filing On line 2 of the Mortgage Insurance Premiums Deduction Worksheet, enter the amount from line 13 of this worksheet. Free h & r block tax filing   □ No. Free h & r block tax filing Your deduction is not limited. Free h & r block tax filing Enter the amount from line 19 on line 20 and enter -0- on line 21. Free h & r block tax filing Line 23. Free h & r block tax filing   If you had a contributions carryover from 2012 to 2013 and your NOL deduction includes an amount from an NOL year before 2012, you may have to reduce your contributions carryover. Free h & r block tax filing Reduce the contributions carryover by the amount of any adjustment you made to your 2012 charitable contributions deduction when figuring your NOL carryover to 2013. Free h & r block tax filing Use the reduced contributions carryover to figure the amount to enter on line 23. Free h & r block tax filing Please click here for the text description of the image. Free h & r block tax filing Worksheet for NOL Carryover Worksheet for NOL Carryover (Continued) How To Get Tax Help Whether it's help with a tax issue, preparing your tax return or a need for a free publication or form, get the help you need the way you want it: online, use a smart phone, call or walk in to an IRS office or volunteer site near you. Free h & r block tax filing Free help with your tax return. Free h & r block tax filing   You can get free help preparing your return nationwide from IRS-certified volunteers. Free h & r block tax filing The Volunteer Income Tax Assistance (VITA) program helps low-to-moderate income, elderly, people with disabilities, and limited English proficient taxpayers. Free h & r block tax filing The Tax Counseling for the Elderly (TCE) program helps taxpayers age 60 and older with their tax returns. Free h & r block tax filing Most VITA and TCE sites offer free electronic filing and all volunteers will let you know about credits and deductions you may be entitled to claim. Free h & r block tax filing In addition, some VITA and TCE sites provide taxpayers the opportunity to prepare their own return with help from an IRS-certified volunteer. Free h & r block tax filing To find the nearest VITA or TCE site, you can use the VITA Locator Tool on IRS. Free h & r block tax filing gov, download the IRS2Go app, or call 1-800-906-9887. Free h & r block tax filing   As part of the TCE program, AARP offers the Tax-Aide counseling program. Free h & r block tax filing To find the nearest AARP Tax-Aide site, visit AARP's website at www. Free h & r block tax filing aarp. Free h & r block tax filing org/money/taxaide or call 1-888-227-7669. Free h & r block tax filing For more information on these programs, go to IRS. Free h & r block tax filing gov and enter “VITA” in the search box. Free h & r block tax filing Internet. Free h & r block tax filing    IRS. Free h & r block tax filing gov and IRS2Go are ready when you are —24 hours a day, 7 days a week. Free h & r block tax filing Download the free IRS2Go app from the iTunes app store or from Google Play. Free h & r block tax filing Use it to check your refund status, order transcripts of your tax returns or tax account, watch the IRS YouTube channel, get IRS news as soon as it's released to the public, subscribe to filing season updates or daily tax tips, and follow the IRS Twitter news feed, @IRSnews, to get the latest federal tax news, including information about tax law changes and important IRS programs. Free h & r block tax filing Check the status of your 2013 refund with the Where's My Refund? application on IRS. Free h & r block tax filing gov or download the IRS2Go app and select the Refund Status option. Free h & r block tax filing The IRS issues more than 9 out of 10 refunds in less than 21 days. Free h & r block tax filing Using these applications, you can start checking on the status of your return within 24 hours after we receive your e-filed return or 4 weeks after you mail a paper return. Free h & r block tax filing You will also be given a personalized refund date as soon as the IRS processes your tax return and approves your refund. Free h & r block tax filing The IRS updates Where's My Refund? every 24 hours, usually overnight, so you only need to check once a day. Free h & r block tax filing Use the Interactive Tax Assistant (ITA) to research your tax questions. Free h & r block tax filing No need to wait on the phone or stand in line. Free h & r block tax filing The ITA is available 24 hours a day, 7 days a week, and provides you with a variety of tax information related to general filing topics, deductions, credits, and income. Free h & r block tax filing When you reach the response screen, you can print the entire interview and the final response for your records. Free h & r block tax filing New subject areas are added on a regular basis. Free h & r block tax filing  Answers not provided through ITA may be found in Tax Trails, one of the Tax Topics on IRS. Free h & r block tax filing gov which contain general individual and business tax information or by searching the IRS Tax Map, which includes an international subject index. Free h & r block tax filing You can use the IRS Tax Map to search publications and instructions by topic or keyword. Free h & r block tax filing The IRS Tax Map integrates forms and publications into one research tool and provides single-point access to tax law information by subject. Free h & r block tax filing When the user searches the IRS Tax Map, they will be provided with links to related content in existing IRS publications, forms and instructions, questions and answers, and Tax Topics. Free h & r block tax filing Coming this filing season, you can immediately view and print for free all 5 types of individual federal tax transcripts (tax returns, tax account, record of account, wage and income statement, and certification of non-filing) using Get Transcript. Free h & r block tax filing You can also ask the IRS to mail a return or an account transcript to you. Free h & r block tax filing Only the mail option is available by choosing the Tax Records option on the IRS2Go app by selecting Mail Transcript on IRS. Free h & r block tax filing gov or by calling 1-800-908-9946. Free h & r block tax filing Tax return and tax account transcripts are generally available for the current year and the past three years. Free h & r block tax filing Determine if you are eligible for the EITC and estimate the amount of the credit with the Earned Income Tax Credit (EITC) Assistant. Free h & r block tax filing Visit Understanding Your IRS Notice or Letter to get answers to questions about a notice or letter you received from the IRS. Free h & r block tax filing If you received the First Time Homebuyer Credit, you can use the First Time Homebuyer Credit Account Look-up tool for information on your repayments and account balance. Free h & r block tax filing Check the status of your amended return using Where's My Amended Return? Go to IRS. Free h & r block tax filing gov and enter Where's My Amended Return? in the search box. Free h & r block tax filing You can generally expect your amended return to be processed up to 12 weeks from the date we receive it. Free h & r block tax filing It can take up to 3 weeks from the date you mailed it to show up in our system. Free h & r block tax filing Make a payment using one of several safe and convenient electronic payment options available on IRS. Free h & r block tax filing gov. Free h & r block tax filing Select the Payment tab on the front page of IRS. Free h & r block tax filing gov for more information. Free h & r block tax filing Determine if you are eligible and apply for an online payment agreement, if you owe more tax than you can pay today. Free h & r block tax filing Figure your income tax withholding with the IRS Withholding Calculator on IRS. Free h & r block tax filing gov. Free h & r block tax filing Use it if you've had too much or too little withheld, your personal situation has changed, you're starting a new job or you just want to see if you're having the right amount withheld. Free h & r block tax filing Determine if you might be subject to the Alternative Minimum Tax by using the Alternative Minimum Tax Assistant on IRS. Free h & r block tax filing gov. Free h & r block tax filing Request an Electronic Filing PIN by going to IRS. Free h & r block tax filing gov and entering Electronic Filing PIN in the search box. Free h & r block tax filing Download forms, instructions and publications, including accessible versions for people with disabilities. Free h & r block tax filing Locate the nearest Taxpayer Assistance Center (TAC) using the Office Locator tool on IRS. Free h & r block tax filing gov, or choose the Contact Us option on the IRS2Go app and search Local Offices. Free h & r block tax filing An employee can answer questions about your tax account or help you set up a payment plan. Free h & r block tax filing Before you visit, check the Office Locator on IRS. Free h & r block tax filing gov, or Local Offices under Contact Us on IRS2Go to confirm the address, phone number, days and hours of operation, and the services provided. Free h & r block tax filing If you have a special need, such as a disability, you can request an appointment. Free h & r block tax filing Call the local number listed in the Office Locator, or look in the phone book under United States Government, Internal Revenue Service. Free h & r block tax filing Apply for an Employer Identification Number (EIN). Free h & r block tax filing Go to IRS. Free h & r block tax filing gov and enter Apply for an EIN in the search box. Free h & r block tax filing Read the Internal Revenue Code, regulations, or other official guidance. Free h & r block tax filing Read Internal Revenue Bulletins. Free h & r block tax filing Sign up to receive local and national tax news and more by email. Free h & r block tax filing Just click on “subscriptions” above the search box on IRS. Free h & r block tax filing gov and choose from a variety of options. Free h & r block tax filing Phone. Free h & r block tax filing    You can call the IRS, or you can carry it in your pocket with the IRS2Go app on your smart phone or tablet. Free h & r block tax filing Download the free IRS2Go app from the iTunes app store or from Google Play. Free h & r block tax filing Call to locate the nearest volunteer help site, 1-800-906-9887 or you can use the VITA Locator Tool on IRS. Free h & r block tax filing gov, or download the IRS2Go app. Free h & r block tax filing Low-to-moderate income, elderly, people with disabilities, and limited English proficient taxpayers can get free help with their tax return from the nationwide Volunteer Income Tax Assistance (VITA) program. Free h & r block tax filing The Tax Counseling for the Elderly (TCE) program helps taxpayers age 60 and older with their tax returns. Free h & r block tax filing Most VITA and TCE sites offer free electronic filing. Free h & r block tax filing Some VITA and TCE sites provide IRS-certified volunteers who can help prepare your tax return. Free h & r block tax filing Through the TCE program, AARP offers the Tax-Aide counseling program; call 1-888-227-7669 to find the nearest Tax-Aide location. Free h & r block tax filing Call the automated Where's My Refund? information hotline to check the status of your 2013 refund 24 hours a day, 7 days a week at 1-800-829-1954. Free h & r block tax filing If you e-file, you can start checking on the status of your return within 24 hours after the IRS receives your tax return or 4 weeks after you've mailed a paper return. Free h & r block tax filing The IRS issues more than 9 out of 10 refunds in less than 21 days. Free h & r block tax filing Where's My Refund? will give you a personalized refund date as soon as the IRS processes your tax return and approves your refund. Free h & r block tax filing Before you call this automated hotline, have your 2013 tax return handy so you can enter your social security number, your filing status, and the exact whole dollar amount of your refund. Free h & r block tax filing The IRS updates Where's My Refund? every 24 hours, usually overnight, so you only need to check once a day. Free h & r block tax filing Note, the above information is for our automated hotline. Free h & r block tax filing Our live phone and walk-in assistors can research the status of your refund only if it's been 21 days or more since you filed electronically or more than 6 weeks since you mailed your paper return. Free h & r block tax filing Call the Amended Return Hotline, 1-866-464-2050, to check the status of your amended return. Free h & r block tax filing You can generally expect your amended return to be processed up to 12 weeks from the date we receive it. Free h & r block tax filing It can take up to 3 weeks from the date you mailed it to show up in our system. Free h & r block tax filing Call 1-800-TAX-FORM (1-800-829-3676) to order current-year forms, instructions, publications, and prior-year forms and instructions (limited to 5 years). Free h & r block tax filing You should receive your order within 10 business days. Free h & r block tax filing Call TeleTax, 1-800-829-4477, to listen to pre-recorded messages covering general and business tax information. Free h & r block tax filing If, between January and April 15, you still have questions about the Form 1040, 1040A, or 1040EZ (like filing requirements, dependents, credits, Schedule D, pensions and IRAs or self-employment taxes), call 1-800-829-1040. Free h & r block tax filing Call using TTY/TDD equipment, 1-800-829-4059 to ask tax questions or order forms and publications. Free h & r block tax filing The TTY/TDD telephone number is for people who are deaf, hard of hearing, or have a speech disability. Free h & r block tax filing These individuals can also contact the IRS through relay services such as the Federal Relay Service. Free h & r block tax filing Walk-in. Free h & r block tax filing   You can find a selection of forms, publications and services — in person. Free h & r block tax filing Products. Free h & r block tax filing You can walk in to some post offices, libraries, and IRS offices to pick up certain forms, instructions, and publications. Free h & r block tax filing Some IRS offices, libraries, and city and county government offices have a collection of products available to photocopy from reproducible proofs. Free h & r block tax filing Services. Free h & r block tax filing You can walk in to your local TAC for face-to-face tax help. Free h & r block tax filing An employee can answer questions about your tax account or help you set up a payment plan. Free h & r block tax filing Before visiting, use the Office Locator tool on IRS. Free h & r block tax filing gov, or choose the Contact Us option on the IRS2Go app and search Local Offices for days and hours of operation, and services provided. Free h & r block tax filing Mail. Free h & r block tax filing   You can send your order for forms, instructions, and publications to the address below. Free h & r block tax filing You should receive a response within 10 business days after your request is received. Free h & r block tax filing Internal Revenue Service 1201 N. Free h & r block tax filing Mitsubishi Motorway Bloomington, IL 61705-6613    The Taxpayer Advocate Service Is Here to Help You. Free h & r block tax filing The Taxpayer Advocate Service (TAS) is your voice at the IRS. Free h & r block tax filing Our job is to ensure that every taxpayer is treated fairly and that you know and understand your rights. Free h & r block tax filing   What can TAS do for you? We can offer you free help with IRS problems that you can't resolve on your own. Free h & r block tax filing We know this process can be confusing, but the worst thing you can do is nothing at all! TAS can help if you can't resolve your tax problem and: Your problem is causing financial difficulties for you, your family, or your business. Free h & r block tax filing You face (or your business is facing) an immediate threat of adverse action. Free h & r block tax filing You've tried repeatedly to contact the IRS but no one has responded, or the IRS hasn't responded by the date promised. Free h & r block tax filing   If you qualify for our help, you'll be assigned to one advocate who'll be with you at every turn and will do everything possible to resolve your problem. Free h & r block tax filing Here's why we can help: TAS is an independent organization within the IRS. Free h & r block tax filing Our advocates know how to work with the IRS. Free h & r block tax filing Our services are free and tailored to meet your needs. Free h & r block tax filing We have offices in every state, the District of Columbia, and Puerto Rico. Free h & r block tax filing   How can you reach us? If you think TAS can help you, call your local advocate, whose number is in your local directory and at Taxpayer Advocate, or call us toll-free at 1-877-777-4778. Free h & r block tax filing   How else does TAS help taxpayers?  TAS also works to resolve large-scale, systemic problems that affect many taxpayers. Free h & r block tax filing If you know of one of these broad issues, please report it to us through our Systemic Advocacy Management System. Free h & r block tax filing Low Income Taxpayer Clinics Low Income