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Freestatetaxreturns 8. Freestatetaxreturns   Dividends and Other Distributions Table of Contents Reminder Introduction Useful Items - You may want to see: General InformationDividends not reported on Form 1099-DIV. Freestatetaxreturns Reporting tax withheld. Freestatetaxreturns Nominees. Freestatetaxreturns Ordinary DividendsQualified Dividends Dividends Used to Buy More Stock Money Market Funds Capital Gain DistributionsBasis adjustment. Freestatetaxreturns Nondividend DistributionsLiquidating Distributions Distributions of Stock and Stock Rights Other DistributionsInformation reporting requirement. Freestatetaxreturns Alternative minimum tax treatment. Freestatetaxreturns How To Report Dividend IncomeInvestment interest deducted. Freestatetaxreturns Reminder Foreign-source income. Freestatetaxreturns  If you are a U. Freestatetaxreturns S. Freestatetaxreturns citizen with dividend income from sources outside the United States (foreign-source income), you must report that income on your tax return unless it is exempt by U. Freestatetaxreturns S. Freestatetaxreturns law. Freestatetaxreturns This is true whether you reside inside or outside the United States and whether or not you receive a Form 1099 from the foreign payer. Freestatetaxreturns Introduction This chapter discusses the tax treatment of: Ordinary dividends, Capital gain distributions, Nondividend distributions, and Other distributions you may receive from a corporation or a mutual fund. Freestatetaxreturns This chapter also explains how to report dividend income on your tax return. Freestatetaxreturns Dividends are distributions of money, stock, or other property paid to you by a corporation or by a mutual fund. Freestatetaxreturns You also may receive dividends through a partnership, an estate, a trust, or an association that is taxed as a corporation. Freestatetaxreturns However, some amounts you receive that are called dividends are actually interest income. Freestatetaxreturns (See Dividends that are actually interest under Taxable Interest in chapter 7. Freestatetaxreturns ) Most distributions are paid in cash (or check). Freestatetaxreturns However, distributions can consist of more stock, stock rights, other property, or services. Freestatetaxreturns Useful Items - You may want to see: Publication 514 Foreign Tax Credit for Individuals 550 Investment Income and Expenses Form (and Instructions) Schedule B (Form 1040A or 1040) Interest and Ordinary Dividends General Information This section discusses general rules for dividend income. Freestatetaxreturns Tax on unearned income of certain children. Freestatetaxreturns   Part of a child's 2013 unearned income may be taxed at the parent's tax rate. Freestatetaxreturns If it is, Form 8615, Tax for Certain Children Who Have Unearned Income, must be completed and attached to the child's tax return. Freestatetaxreturns If not, Form 8615 is not required and the child's income is taxed at his or her own tax rate. Freestatetaxreturns    Some parents can choose to include the child's interest and dividends on the parent's return if certain requirements are met. Freestatetaxreturns Use Form 8814, Parents' Election To Report Child's Interest and Dividends, for this purpose. Freestatetaxreturns   For more information about the tax on unearned income of children and the parents' election, see chapter 31. Freestatetaxreturns Beneficiary of an estate or trust. Freestatetaxreturns    Dividends and other distributions you receive as a beneficiary of an estate or trust are generally taxable income. Freestatetaxreturns You should receive a Schedule K-1 (Form 1041), Beneficiary's Share of Income, Deductions, Credits, etc. Freestatetaxreturns , from the fiduciary. Freestatetaxreturns Your copy of Schedule K-1 (Form 1041) and its instructions will tell you where to report the income on your Form 1040. Freestatetaxreturns Social security number (SSN) or individual taxpayer identification number (ITIN). Freestatetaxreturns    You must give your SSN or ITIN to any person required by federal tax law to make a return, statement, or other document that relates to you. Freestatetaxreturns This includes payers of dividends. Freestatetaxreturns If you do not give your SSN or ITIN to the payer of dividends, you may have to pay a penalty. Freestatetaxreturns For more information on SSNs and ITINs, see Social Security Number (SSN) in chapter 1. Freestatetaxreturns Backup withholding. Freestatetaxreturns   Your dividend income is generally not subject to regular withholding. Freestatetaxreturns However, it may be subject to backup withholding to ensure that income tax is collected on the income. Freestatetaxreturns Under backup withholding, the payer of dividends must withhold, as income tax, on the amount you are paid, applying the appropriate withholding rate. Freestatetaxreturns   Backup withholding may also be required if the IRS has determined that you underreported your interest or dividend income. Freestatetaxreturns For more information, see Backup Withholding in chapter 4. Freestatetaxreturns Stock certificate in two or more names. Freestatetaxreturns   If two or more persons hold stock as joint tenants, tenants by the entirety, or tenants in common, each person's share of any dividends from the stock is determined by local law. Freestatetaxreturns Form 1099-DIV. Freestatetaxreturns   Most corporations and mutual funds use Form 1099-DIV, Dividends and Distributions, to show you the distributions you received from them during the year. Freestatetaxreturns Keep this form with your records. Freestatetaxreturns You do not have to attach it to your tax return. Freestatetaxreturns Dividends not reported on Form 1099-DIV. Freestatetaxreturns   Even if you do not receive Form 1099-DIV, you must still report all your taxable dividend income. Freestatetaxreturns For example, you may receive distributive shares of dividends from partnerships or S corporations. Freestatetaxreturns These dividends are reported to you on Schedule K-1 (Form 1065), Partner's Share of Income, Deductions, Credits, etc. Freestatetaxreturns , and Schedule K-1 (Form 1120S), Shareholder's Share of Income, Deductions, Credits, etc. Freestatetaxreturns Reporting tax withheld. Freestatetaxreturns   If tax is withheld from your dividend income, the payer must give you a Form 1099-DIV that indicates the amount withheld. Freestatetaxreturns Nominees. Freestatetaxreturns   If someone receives distributions as a nominee for you, that person should give you a Form 1099-DIV, which will show distributions received on your behalf. Freestatetaxreturns Form 1099-MISC. Freestatetaxreturns   Certain substitute payments in lieu of dividends or tax-exempt interest received by a broker on your behalf must be reported to you on Form 1099-MISC, Miscellaneous Income, or a similar statement. Freestatetaxreturns See Reporting Substitute Payments under Short Sales in chapter 4 of Publication 550 for more information about reporting these payments. Freestatetaxreturns Incorrect amount shown on a Form 1099. Freestatetaxreturns   If you receive a Form 1099 that shows an incorrect amount (or other incorrect information), you should ask the issuer for a corrected form. Freestatetaxreturns The new Form 1099 you receive will be marked “Corrected. Freestatetaxreturns ” Dividends on stock sold. Freestatetaxreturns   If stock is sold, exchanged, or otherwise disposed of after a dividend is declared but before it is paid, the owner of record (usually the payee shown on the dividend check) must include the dividend in income. Freestatetaxreturns Dividends received in January. Freestatetaxreturns   If a mutual fund (or other regulated investment company) or real estate investment trust (REIT) declares a dividend (including any exempt-interest dividend or capital gain distribution) in October, November, or December, payable to shareholders of record on a date in one of those months but actually pays the dividend during January of the next calendar year, you are considered to have received the dividend on December 31. Freestatetaxreturns You report the dividend in the year it was declared. Freestatetaxreturns Ordinary Dividends Ordinary (taxable) dividends are the most common type of distribution from a corporation or a mutual fund. Freestatetaxreturns They are paid out of earnings and profits and are ordinary income to you. Freestatetaxreturns This means they are not capital gains. Freestatetaxreturns You can assume that any dividend you receive on common or preferred stock is an ordinary dividend unless the paying corporation or mutual fund tells you otherwise. Freestatetaxreturns Ordinary dividends will be shown in box 1a of the Form 1099-DIV you receive. Freestatetaxreturns Qualified Dividends Qualified dividends are the ordinary dividends subject to the same 0%, 15%, or 20% maximum tax rate that applies to net capital gain. Freestatetaxreturns They should be shown in box 1b of the Form 1099-DIV you receive. Freestatetaxreturns The maximum rate of tax on qualified dividends is: 0% on any amount that otherwise would be taxed at a 10% or 15% rate. Freestatetaxreturns 15% on any amount that otherwise would be taxed at rates greater than 15% but less than 39. Freestatetaxreturns 6%. Freestatetaxreturns 20% on any amount that otherwise would be taxed at a 39. Freestatetaxreturns 6% rate. Freestatetaxreturns To qualify for the maximum rate, all of the following requirements must be met. Freestatetaxreturns The dividends must have been paid by a U. Freestatetaxreturns S. Freestatetaxreturns corporation or a qualified foreign corporation. Freestatetaxreturns (See Qualified foreign corporation , later. Freestatetaxreturns ) The dividends are not of the type listed later under Dividends that are not qualified dividends . Freestatetaxreturns You meet the holding period (discussed next). Freestatetaxreturns Holding period. Freestatetaxreturns   You must have held the stock for more than 60 days during the 121-day period that begins 60 days before the ex-dividend date. Freestatetaxreturns The ex-dividend date is the first date following the declaration of a dividend on which the buyer of a stock is not entitled to receive the next dividend payment. Freestatetaxreturns Instead, the seller will get the dividend. Freestatetaxreturns   When counting the number of days you held the stock, include the day you disposed of the stock, but not the day you acquired it. Freestatetaxreturns See the examples later. Freestatetaxreturns Exception for preferred stock. Freestatetaxreturns   In the case of preferred stock, you must have held the stock more than 90 days during the 181-day period that begins 90 days before the ex-dividend date if the dividends are due to periods totaling more than 366 days. Freestatetaxreturns If the preferred dividends are due to periods totaling less than 367 days, the holding period in the previous paragraph applies. Freestatetaxreturns Example 1. Freestatetaxreturns You bought 5,000 shares of XYZ Corp. Freestatetaxreturns common stock on July 9, 2013. Freestatetaxreturns XYZ Corp. Freestatetaxreturns paid a cash dividend of 10 cents per share. Freestatetaxreturns The ex-dividend date was July 16, 2013. Freestatetaxreturns Your Form 1099-DIV from XYZ Corp. Freestatetaxreturns shows $500 in box 1a (ordinary dividends) and in box 1b (qualified dividends). Freestatetaxreturns However, you sold the 5,000 shares on August 12, 2013. Freestatetaxreturns You held your shares of XYZ Corp. Freestatetaxreturns for only 34 days of the 121-day period (from July 10, 2013, through August 12, 2013). Freestatetaxreturns The 121-day period began on May 17, 2013 (60 days before the ex-dividend date), and ended on September 14, 2013. Freestatetaxreturns You have no qualified dividends from XYZ Corp. Freestatetaxreturns because you held the XYZ stock for less than 61 days. Freestatetaxreturns Example 2. Freestatetaxreturns Assume the same facts as in Example 1 except that you bought the stock on July 15, 2013 (the day before the ex-dividend date), and you sold the stock on September 16, 2013. Freestatetaxreturns You held the stock for 63 days (from July 16, 2013, through September 16, 2013). Freestatetaxreturns The $500 of qualified dividends shown in box 1b of your Form 1099-DIV are all qualified dividends because you held the stock for 61 days of the 121-day period (from July 16, 2013, through September 14, 2013). Freestatetaxreturns Example 3. Freestatetaxreturns You bought 10,000 shares of ABC Mutual Fund common stock on July 9, 2013. Freestatetaxreturns ABC Mutual Fund paid a cash dividend of 10 cents a share. Freestatetaxreturns The ex-dividend date was July 16, 2013. Freestatetaxreturns The ABC Mutual Fund advises you that the portion of the dividend eligible to be treated as qualified dividends equals 2 cents per share. Freestatetaxreturns Your Form 1099-DIV from ABC Mutual Fund shows total ordinary dividends of $1,000 and qualified dividends of $200. Freestatetaxreturns However, you sold the 10,000 shares on August 12, 2013. Freestatetaxreturns You have no qualified dividends from ABC Mutual Fund because you held the ABC Mutual Fund stock for less than 61 days. Freestatetaxreturns Holding period reduced where risk of loss is diminished. Freestatetaxreturns   When determining whether you met the minimum holding period discussed earlier, you cannot count any day during which you meet any of the following conditions. Freestatetaxreturns You had an option to sell, were under a contractual obligation to sell, or had made (and not closed) a short sale of substantially identical stock or securities. Freestatetaxreturns You were grantor (writer) of an option to buy substantially identical stock or securities. Freestatetaxreturns Your risk of loss is diminished by holding one or more other positions in substantially similar or related property. Freestatetaxreturns   For information about how to apply condition (3), see Regulations section 1. Freestatetaxreturns 246-5. Freestatetaxreturns Qualified foreign corporation. Freestatetaxreturns   A foreign corporation is a qualified foreign corporation if it meets any of the following conditions. Freestatetaxreturns The corporation is incorporated in a U. Freestatetaxreturns S. Freestatetaxreturns possession. Freestatetaxreturns The corporation is eligible for the benefits of a comprehensive income tax treaty with the United States that the Treasury Department determines is satisfactory for this purpose and that includes an exchange of information program. Freestatetaxreturns For a list of those treaties, see Table 8-1. Freestatetaxreturns The corporation does not meet (1) or (2) above, but the stock for which the dividend is paid is readily tradable on an established securities market in the United States. Freestatetaxreturns See Readily tradable stock , later. Freestatetaxreturns Exception. Freestatetaxreturns   A corporation is not a qualified foreign corporation if it is a passive foreign investment company during its tax year in which the dividends are paid or during its previous tax year. Freestatetaxreturns Readily tradable stock. Freestatetaxreturns   Any stock (such as common, ordinary, or preferred) or an American depositary receipt in respect of that stock is considered to satisfy requirement (3) under Qualified foreign corporation , if it is listed on a national securities exchange that is registered under section 6 of the Securities Exchange Act of 1934 or on the Nasdaq Stock Market. Freestatetaxreturns For a list of the exchanges that meet these requirements, see www. Freestatetaxreturns sec. Freestatetaxreturns gov/divisions/marketreg/mrexchanges. Freestatetaxreturns shtml. Freestatetaxreturns Dividends that are not qualified dividends. Freestatetaxreturns   The following dividends are not qualified dividends. Freestatetaxreturns They are not qualified dividends even if they are shown in box 1b of Form 1099-DIV. Freestatetaxreturns Capital gain distributions. Freestatetaxreturns Dividends paid on deposits with mutual savings banks, cooperative banks, credit unions, U. Freestatetaxreturns S. Freestatetaxreturns building and loan associations, U. Freestatetaxreturns S. Freestatetaxreturns savings and loan associations, federal savings and loan associations, and similar financial institutions. Freestatetaxreturns (Report these amounts as interest income. Freestatetaxreturns ) Dividends from a corporation that is a tax-exempt organization or farmer's cooperative during the corporation's tax year in which the dividends were paid or during the corporation's previous tax year. Freestatetaxreturns Dividends paid by a corporation on employer securities held on the date of record by an employee stock ownership plan (ESOP) maintained by that corporation. Freestatetaxreturns Dividends on any share of stock to the extent you are obligated (whether under a short sale or otherwise) to make related payments for positions in substantially similar or related property. Freestatetaxreturns Payments in lieu of dividends, but only if you know or have reason to know the payments are not qualified dividends. Freestatetaxreturns Payments shown in Form 1099-DIV, box 1b, from a foreign corporation to the extent you know or have reason to know the payments are not qualified dividends. Freestatetaxreturns Table 8-1. Freestatetaxreturns Income Tax Treaties Income tax treaties the United States has with the following countries satisfy requirement (2) under Qualified foreign corporation. Freestatetaxreturns Australia Indonesia Romania Austria Ireland Russian Bangladesh Israel Federation Barbados Italy Slovak Belgium Jamaica Republic Bulgaria Japan Slovenia Canada Kazakhstan South Africa China Korea Spain Cyprus Latvia Sri Lanka Czech Lithuania Sweden Republic Luxembourg Switzerland Denmark Malta Thailand Egypt Mexico Trinidad and Estonia Morocco Tobago Finland Netherlands Tunisia France New Zealand Turkey Germany Norway Ukraine Greece Pakistan United Hungary Philippines Kingdom Iceland Poland Venezuela India Portugal     Dividends Used to Buy More Stock The corporation in which you own stock may have a dividend reinvestment plan. Freestatetaxreturns This plan lets you choose to use your dividends to buy (through an agent) more shares of stock in the corporation instead of receiving the dividends in cash. Freestatetaxreturns Most mutual funds also permit shareholders to automatically reinvest distributions in more shares in the fund, instead of receiving cash. Freestatetaxreturns If you use your dividends to buy more stock at a price equal to its fair market value, you still must report the dividends as income. Freestatetaxreturns If you are a member of a dividend reinvestment plan that lets you buy more stock at a price less than its fair market value, you must report as dividend income the fair market value of the additional stock on the dividend payment date. Freestatetaxreturns You also must report as dividend income any service charge subtracted from your cash dividends before the dividends are used to buy the additional stock. Freestatetaxreturns But you may be able to deduct the service charge. Freestatetaxreturns See chapter 28 for more information about deducting expenses of producing income. Freestatetaxreturns In some dividend reinvestment plans, you can invest more cash to buy shares of stock at a price less than fair market value. Freestatetaxreturns If you choose to do this, you must report as dividend income the difference between the cash you invest and the fair market value of the stock you buy. Freestatetaxreturns When figuring this amount, use the fair market value of the stock on the dividend payment date. Freestatetaxreturns Money Market Funds Report amounts you receive from money market funds as dividend income. Freestatetaxreturns Money market funds are a type of mutual fund and should not be confused with bank money market accounts that pay interest. Freestatetaxreturns Capital Gain Distributions Capital gain distributions (also called capital gain dividends) are paid to you or credited to your account by mutual funds (or other regulated investment companies) and real estate investment trusts (REITs). Freestatetaxreturns They will be shown in box 2a of the Form 1099-DIV you receive from the mutual fund or REIT. Freestatetaxreturns Report capital gain distributions as long-term capital gains, regardless of how long you owned your shares in the mutual fund or REIT. Freestatetaxreturns Undistributed capital gains of mutual funds and REITs. Freestatetaxreturns    Some mutual funds and REITs keep their long-term capital gains and pay tax on them. Freestatetaxreturns You must treat your share of these gains as distributions, even though you did not actually receive them. Freestatetaxreturns However, they are not included on Form 1099-DIV. Freestatetaxreturns Instead, they are reported to you in box 1a of Form 2439. Freestatetaxreturns   Report undistributed capital gains (box 1a of Form 2439) as long-term capital gains on Schedule D (Form 1040), column (h), line 11. Freestatetaxreturns   The tax paid on these gains by the mutual fund or REIT is shown in box 2 of Form 2439. Freestatetaxreturns You take credit for this tax by including it on Form 1040, line 71, and checking box a on that line. Freestatetaxreturns Attach Copy B of Form 2439 to your return, and keep Copy C for your records. Freestatetaxreturns Basis adjustment. Freestatetaxreturns   Increase your basis in your mutual fund, or your interest in a REIT, by the difference between the gain you report and the credit you claim for the tax paid. Freestatetaxreturns Additional information. Freestatetaxreturns   For more information on the treatment of distributions from mutual funds, see Publication 550. Freestatetaxreturns Nondividend Distributions A nondividend distribution is a distribution that is not paid out of the earnings and profits of a corporation or a mutual fund. Freestatetaxreturns You should receive a Form 1099-DIV or other statement showing the nondividend distribution. Freestatetaxreturns On Form 1099-DIV, a nondividend distribution will be shown in box 3. Freestatetaxreturns If you do not receive such a statement, you report the distribution as an ordinary dividend. Freestatetaxreturns Basis adjustment. Freestatetaxreturns   A nondividend distribution reduces the basis of your stock. Freestatetaxreturns It is not taxed until your basis in the stock is fully recovered. Freestatetaxreturns This nontaxable portion is also called a return of capital; it is a return of your investment in the stock of the company. Freestatetaxreturns If you buy stock in a corporation in different lots at different times, and you cannot definitely identify the shares subject to the nondividend distribution, reduce the basis of your earliest purchases first. Freestatetaxreturns   When the basis of your stock has been reduced to zero, report any additional nondividend distribution you receive as a capital gain. Freestatetaxreturns Whether you report it as a long-term or short-term capital gain depends on how long you have held the stock. Freestatetaxreturns See Holding Period in chapter 14. Freestatetaxreturns Example. Freestatetaxreturns You bought stock in 2000 for $100. Freestatetaxreturns In 2003, you received a nondividend distribution of $80. Freestatetaxreturns You did not include this amount in your income, but you reduced the basis of your stock to $20. Freestatetaxreturns You received a nondividend distribution of $30 in 2013. Freestatetaxreturns The first $20 of this amount reduced your basis to zero. Freestatetaxreturns You report the other $10 as a long-term capital gain for 2013. Freestatetaxreturns You must report as a long-term capital gain any nondividend distribution you receive on this stock in later years. Freestatetaxreturns Liquidating Distributions Liquidating distributions, sometimes called liquidating dividends, are distributions you receive during a partial or complete liquidation of a corporation. Freestatetaxreturns These distributions are, at least in part, one form of a return of capital. Freestatetaxreturns They may be paid in one or more installments. Freestatetaxreturns You will receive Form 1099-DIV from the corporation showing you the amount of the liquidating distribution in box 8 or 9. Freestatetaxreturns For more information on liquidating distributions, see chapter 1 of Publication 550. Freestatetaxreturns Distributions of Stock and Stock Rights Distributions by a corporation of its own stock are commonly known as stock dividends. Freestatetaxreturns Stock rights (also known as “stock options”) are distributions by a corporation of rights to acquire the corporation's stock. Freestatetaxreturns Generally, stock dividends and stock rights are not taxable to you, and you do not report them on your return. Freestatetaxreturns Taxable stock dividends and stock rights. Freestatetaxreturns   Distributions of stock dividends and stock rights are taxable to you if any of the following apply. Freestatetaxreturns You or any other shareholder have the choice to receive cash or other property instead of stock or stock rights. Freestatetaxreturns The distribution gives cash or other property to some shareholders and an increase in the percentage interest in the corporation's assets or earnings and profits to other shareholders. Freestatetaxreturns The distribution is in convertible preferred stock and has the same result as in (2). Freestatetaxreturns The distribution gives preferred stock to some common stock shareholders and common stock to other common stock shareholders. Freestatetaxreturns The distribution is on preferred stock. Freestatetaxreturns (The distribution, however, is not taxable if it is an increase in the conversion ratio of convertible preferred stock made solely to take into account a stock dividend, stock split, or similar event that would otherwise result in reducing the conversion right. Freestatetaxreturns )   The term “stock” includes rights to acquire stock, and the term “shareholder” includes a holder of rights or of convertible securities. Freestatetaxreturns If you receive taxable stock dividends or stock rights, include their fair market value at the time of distribution in your income. Freestatetaxreturns Preferred stock redeemable at a premium. Freestatetaxreturns   If you hold preferred stock having a redemption price higher than its issue price, the difference (the redemption premium) generally is taxable as a constructive distribution of additional stock on the preferred stock. Freestatetaxreturns For more information, see chapter 1 of Publication 550. Freestatetaxreturns Basis. Freestatetaxreturns   Your basis in stock or stock rights received in a taxable distribution is their fair market value when distributed. Freestatetaxreturns If you receive stock or stock rights that are not taxable to you, see Stocks and Bonds under Basis of Investment Property in chapter 4 of Publication 550 for information on how to figure their basis. Freestatetaxreturns Fractional shares. Freestatetaxreturns    You may not own enough stock in a corporation to receive a full share of stock if the corporation declares a stock dividend. Freestatetaxreturns However, with the approval of the shareholders, the corporation may set up a plan in which fractional shares are not issued but instead are sold, and the cash proceeds are given to the shareholders. Freestatetaxreturns Any cash you receive for fractional shares under such a plan is treated as an amount realized on the sale of the fractional shares. Freestatetaxreturns Report this transaction on Form 8949, Sales and Other Dispositions of Capital Assets. Freestatetaxreturns Enter your gain or loss, the difference between the cash you receive and the basis of the fractional shares sold, in column (h) of Schedule D (Form 1040) in Part I or Part II, whichever is appropriate. Freestatetaxreturns    Report these transactions on Form 8949 with the correct box checked. Freestatetaxreturns   For more information on Form 8949 and Schedule D (Form 1040), see chapter 4 of Publication 550. Freestatetaxreturns Also see the Instructions for Form 8949 and the Instructions for Schedule D (Form 1040). Freestatetaxreturns Example. Freestatetaxreturns You own one share of common stock that you bought on January 3, 2004, for $100. Freestatetaxreturns The corporation declared a common stock dividend of 5% on June 29, 2013. Freestatetaxreturns The fair market value of the stock at the time the stock dividend was declared was $200. Freestatetaxreturns You were paid $10 for the fractional-share stock dividend under a plan described in the discussion above. Freestatetaxreturns You figure your gain or loss as follows: Fair market value of old stock $200. Freestatetaxreturns 00 Fair market value of stock dividend (cash received) +10. Freestatetaxreturns 00 Fair market value of old stock and stock dividend $210. Freestatetaxreturns 00 Basis (cost) of old stock after the stock dividend (($200 ÷ $210) × $100) $95. Freestatetaxreturns 24 Basis (cost) of stock dividend (($10 ÷ $210) × $100) + 4. Freestatetaxreturns 76 Total $100. Freestatetaxreturns 00 Cash received $10. Freestatetaxreturns 00 Basis (cost) of stock dividend − 4. Freestatetaxreturns 76 Gain $5. Freestatetaxreturns 24 Because you had held the share of stock for more than 1 year at the time the stock dividend was declared, your gain on the stock dividend is a long-term capital gain. Freestatetaxreturns Scrip dividends. Freestatetaxreturns   A corporation that declares a stock dividend may issue you a scrip certificate that entitles you to a fractional share. Freestatetaxreturns The certificate is generally nontaxable when you receive it. Freestatetaxreturns If you choose to have the corporation sell the certificate for you and give you the proceeds, your gain or loss is the difference between the proceeds and the portion of your basis in the corporation's stock allocated to the certificate. Freestatetaxreturns   However, if you receive a scrip certificate that you can choose to redeem for cash instead of stock, the certificate is taxable when you receive it. Freestatetaxreturns You must include its fair market value in income on the date you receive it. Freestatetaxreturns Other Distributions You may receive any of the following distributions during the year. Freestatetaxreturns Exempt-interest dividends. Freestatetaxreturns   Exempt-interest dividends you receive from a mutual fund or other regulated investment company, including those received from a qualified fund of funds in any tax year beginning after December 22, 2010, are not included in your taxable income. Freestatetaxreturns Exempt-interest dividends should be shown in box 10 of Form 1099-DIV. Freestatetaxreturns Information reporting requirement. Freestatetaxreturns   Although exempt-interest dividends are not taxable, you must show them on your tax return if you have to file a return. Freestatetaxreturns This is an information reporting requirement and does not change the exempt-interest dividends to taxable income. Freestatetaxreturns Alternative minimum tax treatment. Freestatetaxreturns   Exempt-interest dividends paid from specified private activity bonds may be subject to the alternative minimum tax. Freestatetaxreturns See Alternative Minimum Tax (AMT) in chapter 30 for more information. Freestatetaxreturns Dividends on insurance policies. Freestatetaxreturns    Insurance policy dividends the insurer keeps and uses to pay your premiums are not taxable. Freestatetaxreturns However, you must report as taxable interest income the interest that is paid or credited on dividends left with the insurance company. Freestatetaxreturns    If dividends on an insurance contract (other than a modified endowment contract) are distributed to you, they are a partial return of the premiums you paid. Freestatetaxreturns Do not include them in your gross income until they are more than the total of all net premiums you paid for the contract. Freestatetaxreturns Report any taxable distributions on insurance policies on Form 1040, line 21. Freestatetaxreturns Dividends on veterans' insurance. Freestatetaxreturns   Dividends you receive on veterans' insurance policies are not taxable. Freestatetaxreturns In addition, interest on dividends left with the Department of Veterans Affairs is not taxable. Freestatetaxreturns Patronage dividends. Freestatetaxreturns   Generally, patronage dividends you receive in money from a cooperative organization are included in your income. Freestatetaxreturns   Do not include in your income patronage dividends you receive on: Property bought for your personal use, or Capital assets or depreciable property bought for use in your business. Freestatetaxreturns But you must reduce the basis (cost) of the items bought. Freestatetaxreturns If the dividend is more than the adjusted basis of the assets, you must report the excess as income. Freestatetaxreturns   These rules are the same whether the cooperative paying the dividend is a taxable or tax-exempt cooperative. Freestatetaxreturns Alaska Permanent Fund dividends. Freestatetaxreturns    Do not report these amounts as dividends. Freestatetaxreturns Instead, report these amounts on Form 1040, line 21; Form 1040A, line 13; or Form 1040EZ, line 3. Freestatetaxreturns How To Report Dividend Income Generally, you can use either Form 1040 or Form 1040A to report your dividend income. Freestatetaxreturns Report the total of your ordinary dividends on line 9a of Form 1040 or Form 1040A. Freestatetaxreturns Report qualified dividends on line 9b of Form 1040 or Form 1040A. Freestatetaxreturns If you receive capital gain distributions, you may be able to use Form 1040A or you may have to use Form 1040. Freestatetaxreturns See Exceptions to filing Form 8949 and Schedule D (Form 1040) in chapter 16. Freestatetaxreturns If you receive nondividend distributions required to be reported as capital gains, you must use Form 1040. Freestatetaxreturns You cannot use Form 1040EZ if you receive any dividend income. Freestatetaxreturns Form 1099-DIV. Freestatetaxreturns   If you owned stock on which you received $10 or more in dividends and other distributions, you should receive a Form 1099-DIV. Freestatetaxreturns Even if you do not receive Form 1099-DIV, you must report all your dividend income. Freestatetaxreturns   See Form 1099-DIV for more information on how to report dividend income. Freestatetaxreturns Form 1040A or 1040. Freestatetaxreturns    You must complete Schedule B (Form 1040A or 1040), Part II, and attach it to your Form 1040A or 1040, if: Your ordinary dividends (Form 1099-DIV, box 1a) are more than $1,500, or You received, as a nominee, dividends that actually belong to someone else. Freestatetaxreturns If your ordinary dividends are more than $1,500, you must also complete Schedule B (Form 1040A or 1040), Part III. Freestatetaxreturns   List on Schedule B (Form 1040A or 1040), Part II, line 5, each payer's name and the ordinary dividends you received. Freestatetaxreturns If your securities are held by a brokerage firm (in “street name”), list the name of the brokerage firm shown on Form 1099-DIV as the payer. Freestatetaxreturns If your stock is held by a nominee who is the owner of record, and the nominee credited or paid you dividends on the stock, show the name of the nominee and the dividends you received or for which you were credited. Freestatetaxreturns   Enter on line 6 the total of the amounts listed on line 5. Freestatetaxreturns Also enter this total on line 9a of Form 1040A or 1040. Freestatetaxreturns Qualified dividends. Freestatetaxreturns   Report qualified dividends (Form 1099-DIV, box 1b) on line 9b of Form 1040 or Form 1040A. Freestatetaxreturns The amount in box 1b is already included in box 1a. Freestatetaxreturns Do not add the amount in box 1b to, or substract it from, the amount in box 1a. Freestatetaxreturns   Do not include any of the following on line 9b. Freestatetaxreturns Qualified dividends you received as a nominee. Freestatetaxreturns See Nominees under How to Report Dividend Income in chapter 1 of Publication 550. Freestatetaxreturns Dividends on stock for which you did not meet the holding period. Freestatetaxreturns See Holding period , earlier under Qualified Dividends. Freestatetaxreturns Dividends on any share of stock to the extent you are obligated (whether under a short sale or otherwise) to make related payments for positions in substantially similar or related property. Freestatetaxreturns Payments in lieu of dividends, but only if you know or have reason to know the payments are not qualified dividends. Freestatetaxreturns Payments shown in Form 1099-DIV, box 1b, from a foreign corporation to the extent you know or have reason to know the payments are not qualified dividends. Freestatetaxreturns   If you have qualified dividends, you must figure your tax by completing the Qualified Dividends and Capital Gain Tax Worksheet in the Form 1040 or 1040A instructions or the Schedule D Tax Worksheet in the Schedule D (Form 1040) instructions, whichever applies. Freestatetaxreturns Enter qualified dividends on line 2 of the worksheet. Freestatetaxreturns Investment interest deducted. Freestatetaxreturns   If you claim a deduction for investment interest, you may have to reduce the amount of your qualified dividends that are eligible for the 0%, 15%, or 20% tax rate. Freestatetaxreturns Reduce it by the qualified dividends you choose to include in investment income when figuring the limit on your investment interest deduction. Freestatetaxreturns This is done on the Qualified Dividends and Capital Gain Tax Worksheet or the Schedule D Tax Worksheet. Freestatetaxreturns For more information about the limit on investment interest, see Investment expenses in chapter 23. Freestatetaxreturns Expenses related to dividend income. Freestatetaxreturns   You may be able to deduct expenses related to dividend income if you itemize your deductions on Schedule A (Form 1040). Freestatetaxreturns See chapter 28 for general information about deducting expenses of producing income. Freestatetaxreturns More information. Freestatetaxreturns    For more information about how to report dividend income, see chapter 1 of Publication 550 or the instructions for the form you must file. Freestatetaxreturns Prev  Up  Next   Home   More Online Publications
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About the API

We make the content you see in our directory of federal agencies available in both English and Spanish via a REST API. The API programmatically returns all of the information contained in the directory, or you can query the API to return just a subset of the available information.

If you are using the Federal Agency Directory API and have feedback or want to tell us about your product, please e-mail us.

Changes to the API

On December 28, 2012, we launched version 2.0 of the API and made the following changes:

  • Launched new methods to return directory records in a hierarchical fashion.
  • Results can now be returned using XML and JSONP, as well as straight JSON.
  • The Interface method was removed.

About the Data

The data in the Federal Agency Directory API is based on the English and Spanish federal agency directories. We gather this data from the agency information listed in the U.S. Government Manual, and independent research by our staff.

There is no schedule for data updates; we update data continually, and as needed. Early versions of the API may have incomplete and inconsistent data. We are working to continually develop the data in our directory records.

If you have suggestions about what types of data you would like to see in the Federal Agency Directory API, please e-mail us.

About the Spanish Data

GobiernoUSA.gov and the North American Academy of the Spanish Language (ANLE, per its Spanish acronym) worked together to review federal agencies Spanish translations to ensure language accuracy and consistency throughout the government. ANLE, the highest authority on Spanish language in the United States, and GobiernoUSA.gov have the joined mission of improving and standardizing the use of Spanish language in government communications.

This collaboration, possible through a signed agreement between the two institutions, resulted in a list of official Spanish language translations of federal agencies, available through this API.

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Accessing the API

Our Federal Agency Directory API is accessible via HTTP GET requests and does not require a login or API key to use.

The base URL for the API is http://www.usa.gov/api/USAGovAPI/contacts.{format}/. Append the API call you’d like to make to this URL.

Currently, three output formats are available:

  1. JSON (such as http://www.usa.gov/api/USAGovAPI/contacts.json/contacts)
  2. XML (such as http://www.usa.gov/api/USAGovAPI/contacts.xml/contacts)
  3. JSONP (such as http://www.usa.gov/api/USAGovAPI/contacts.jsonp/contacts?callback=callmemaybe). When requesting JSONP, you should include a callback parameter with the name of the callback function you would like called.

For the purposes of this documentation, only JSON sample calls and results will be shown.

API Result Formats

The Federal Agency Directory API returns results in json, with an optional callback parameter to enable jsonp support.

Interactive Documentation for the API

If you're interested in trying out the Federal Agency Directory API, we have an interactive test page. On this page, you can try different parameters and see the results.

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API Data Model

The following fields are associated with directory records. Please note that not every record has data in every field, and the API will only return completed fields.

  • Id - A unique identifier for each directory record
  • Name – The name of the agency.
  • Description – A brief description of the agency.
  • Language – Whether the record is in English or Spanish.
  • Subdivision – Used for mailing items to the agency.
  • Street1 – A first line of address information (such as the street address) for the agency’s main office.
  • Street2 – A second line of address information for the agency’s main office.
  • City – The city of the agency’s main office.
  • StateTer – The state of the agency’s main office.
  • Zip – The postal zip code of the agency’s main office.
  • Email – The e-mail address for the agency’s main office.
  • Phone – The phone number of the agency’s main office (may contain more than one).
  • TTY – The TTY number of the agency’s main office (may contain more than one).
  • Tollfree – The toll-free number to contact the agency (may contain more than one).
  • SMS – Any services offered via text messaging by the agency.
  • Synonym – Alternative names used commonly to refer to the agency (may contain more than one).
  • URI – The URL to access the agency’s complete directory record via the API.
  • Source_Url – The USA.gov or GobiernoUSA.gov URL that contains the record.

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URLs

The directory API returns several types of URLs that can be used to link to the agency.

  • Web_Url – Main URLs for the agency (may contain more than one).
  • Contact_Url – URLs for the public to contact the agency (may contain more than one).
  • In_Person_Url – URLs for the public to find out how to interact with the agney in person (may contain more than one).
  • Form_Url – URLs for the agency to find forms from the agency (may contain more than one).

For each of these URLs, the following sub-data elements are returned:

  • Url – The URL to the web page.
  • Description – A description of the URL.
  • Language – Whether the web page located at the URL is in English (en) or Spanish (es).

Agency Relationships

Additionally, the directory API returns information on the hierarchical relationship between federal agencies.

  • Parent – The parent of the agency. such as the Department of the Treasury for the Internal Revenue Service.
  • Child – Any children departments or agencies for the agency. such as the Census Bureau for the Department of Commerce (may contain more than one of these).
  • Alt_Language – The record for the agency in Spanish, if the record is in English, and vice versa.

For each of these relationships, the following sub-data elements are returned for the related agency:

  • Id – A unique identifier for each directory record
  • Name – The name of the agency.
  • URI – The URL to access the agency’s complete directory record via the API.
  • For Alt_Language only, Language – Whether the alternate language record is in English (en) or Spanish (es).

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API Methods

As of version 2.0, the methods of the Federal Agency Directory API are broken down into two categories. The first category simply returns a list of agency records. The second category returns a hierarchical structure of the agency records, making it easy to form a tree. The tree can show that the Food and Drug Administration is part of the Department of Health and Human Services. This is just one example.

API Methods That Return A List of Agency Records

Contacts

Contacts is a general purpose call that, by default, will return all of the agency directory records. However, you can pass parameters into contacts that allow you to filter the records returned by the API in powerful ways.

Parameters

query_filter – Return only agency directory records that meet the criteria you enter into this parameter. In general, the filter takes the form of {field_name}::{value}[|{field_name}::{value}]*. Additionally, for names, you can perform substring searches by surrounding {value} with asterixis.

For example, if you want to return all agencies that have the word “commission” in their title, you can use a query_filter of name::*commission*. Likewise, if you want to find all commissions who have their main address in Virginia, you can use a query_filter of: name::*commission*|state::VA

See the data model above for a list of field names that you can query on.

result_filter – Return only the fields listed here (separated by |) as opposed to every field in each directory record. For example, use a result_filter of name|phone to return only names and phone numbers.

See the data model above for a list of field names that you can specify be returned.

sort – Allows you to specify the sort order of the returned agency directory records. For example, use a sort of name to sort the results by the agency’s name. You can also cause the sort to go in descending order by prepending the field name with a -, such as -name.

See the data model above for a list of field names that you can sort the results on.

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/contacts/tree/independent

The independent method will return every agency record that has no parent and no child, such as the National Railroad Passenger Corporation.

/contacts/tree

The tree method returns every agency record, and, optionally, includes sub-agencies as part of their parent agency’s record.

Paramaters

include_descendants - Set to true if you want the API to return the descendents directly as part of their parent agency’s record.

/contacts/tree/dependent

The dependent method returns every agency record that has sub-agencies, and, optionally, includes sub-agencies as part of their parent agency’s record.

Parameters

include_descendants - Set to true if you want the API to return the descendents directly as part of their parent agency’s record.

/contact/{identifier}/tree/sibling

The sibling method will return all of the agency records that are siblings to the agency represented by the id specified in the REST URL. It will also return the record for the id specified as well.  

The only difference between the result format of the sibling method and the more generic contacts method is that the siblings method does not return the child and parent data elements as part of it’s results.

For example, if you request the sibling agencies for the U.S. Botanic Garden (id 49108), the API will return records for both the U.S. Botanic Garden and the U.S. Capitol Visitor Center, as both of these agencies are part of the Architect of the Capitol.

If you desired the results in JSON format, the API call for this query would look like the following:
http://www.usa.gov/api/USAGovAPI/contacts.json/contact/49108/tree/sibling

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Sample Results For These Methods

For API methods that return a list of directory records, the API will return an array of objects, such as:

The API will return an array of objects, such as:

{
   "Contact":[
      {
         "Id":"52663",
         "URI":"http://www.usa.gov/api/USAGovAPI/contacts.json/contact/52663",
         "Language":"en",
         "Name":"U.S. Access Board",
         "Source_Url":"http://www.usa.gov/directory/federal/us-access-board.shtml",
         "Street1":"1331 F Street, NW",
         "Street2":"Suite 1000",
         "City":"Washington",
         "StateTer":"DC",
         "Zip":"20004-1111",
         "Synonym":[
            "Access Board"
         ],
         "Phone":[
            "202-272-0080"
         ],
         "Tollfree":[
            "800-872-2253"
         ],
         "TTY":[
            "202-272-0082",
            "800-993-2822"
         ],
         "Email":"info@access-board.gov",
         "Contact_Url":[
            {
               "Url":"http://www.access-board.gov/contact.htm",
               "Description":"Contact the U.S. Access Board ",
               "Language":"en"
            },
            {
               "Url":"http://www.access-board.gov/contact.htm#email",
               "Description":"E-mail Directory",
               "Language":"en"
            },
            {
               "Url":"http://www.access-board.gov/contact.htm#Phone",
               "Description":"Phone Directory",
               "Language":"en"
            },
            {
               "Url":"http://www.access-board.gov/enforcement/filing.htm",
               "Description":"File an Accessibility Complaint",
               "Language":"en"
            }
         ],
         "Web_Url":[
            {
               "Url":"http://www.access-board.gov/",
               "Description":"U.S. Access Board ",
               "Language":"en"
            }
         ],
         "In_Person_Url":[
            {
               "Url":"http://www.access-board.gov/contact.htm#Location",
               "Description":"Map and Directions",
               "Language":"en"
            }
         ],
         "Description":"The Access Board is an independent federal agency devoted to accessibility for people with disabilities. The Board develops and maintains design criteria for the built environment, transit vehicles, telecommunications equipment, and for electronic and information technology. ",
         "Alt_Language":[
            {
               "Id":"50175",
               "URI":"http://www.usa.gov/api/USAGovAPI/contacts.json/contact/50175",
               "Name":"Consejo de Acceso de Estados Unidos",
               "Language":"es"
            }
         ]
      },
      {
         "Id":"61787",
         "URI":"http://www.usa.gov/api/USAGovAPI/contacts.json/contact/61787",
         "Language":"en",
         "Name":"Medicaid and CHIP Payment and Access Commission",
         "Source_Url":"http://www.usa.gov/directory/federal/medicaid-chip-payment-access-commission.shtml",
         "Street1":"1800 M Street, NW",
         "Street2":"Suite 350N",
         "City":"Washington",
         "StateTer":"DC",
         "Zip":"20036",
         "Phone":[
            "202-273-2460"
         ],
         "Email":"webmaster@macpac.gov",
         "Web_Url":[
            {
               "Url":"http://www.macpac.gov",
               "Description":"Medicaid and CHIP Payment and Access Commission ",
               "Language":"en"
            }
         ]
      }
   ]
}

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If you set include_descendents to true in the tree or descendants methods, parent agencies will include an array called "Contact" with their child agency records, such as in this snippet:

{
   "Contact":[
      {
         "Id":"49015",
         "URI":"http://www.usa.gov/api/USAGovAPI/contacts.json/contact/49015",
         "Language":"en",
         "Name":"U.S. Department of Agriculture (USDA)",
         "Source_Url":"http://www.usa.gov/directory/federal/department-of-agriculture.shtml",
         "Street1":"1400 Independence Ave., S.W.",
         "City":"Washington",
         "StateTer":"DC",
         "Zip":"20250",
         "Synonym":[
            "Agriculture Department",
            "Department of Agriculture"
         ],
         "Phone":[
            "202-720-2791"
         ],
         "Contact_Url":[
            {
               "Url":"http://usda.gov/wps/portal/usda/usdahome?navid=CONTACT_US",
               "Description":"Contact the U.S. Department of Agriculture (USDA) ",
               "Language":"en"
            },
            {
               "Url":"http://www.fns.usda.gov/cnd/Contacts/StateDirectory.htm",
               "Description":"Child Nutrition Programs",
               "Language":"en"
            },
            {
               "Url":"http://www.fns.usda.gov/snap/contact_info/default.htm",
               "Description":"Food Stamps",
               "Language":"en"
            },
            {
               "Url":"http://www.fsis.usda.gov/Food_Safety_Education/USDA_Meat_&_Poultry_Hotline/index.asp",
               "Description":"Meat and Poultry Hotline",
               "Language":"en"
            },
            {
               "Url":"http://offices.sc.egov.usda.gov/employeeDirectory/app",
               "Description":"Employee Directory",
               "Language":"en"
            }
         ],
         "Web_Url":[
            {
               "Url":"http://www.usda.gov/wps/portal/usda/usdahome",
               "Description":"U.S. Department of Agriculture (USDA) ",
               "Language":"en"
            }
         ],
         "In_Person_Url":[
            {
               "Url":"http://www.rurdev.usda.gov/recd_map.html",
               "Description":"Rural Development Office Locator",
               "Language":"en"
            },
            {
               "Url":"http://apps.ams.usda.gov/FarmersMarkets/",
               "Description":"Farmers Markets Near You",
               "Language":"en"
            },
            {
               "Url":"http://offices.sc.egov.usda.gov/locator/app",
               "Description":"Find a Service Center Near You",
               "Language":"en"
            }
         ],
         "Description":"The Department of Agriculture provides leadership on food, agriculture, natural resources, and related issues.",
         "Alt_Language":[
            {
               "Id":"50072",
               "URI":"http://www.usa.gov/api/USAGovAPI/contacts.json/contact/50072",
               "Name":"Departamento de Agricultura",
               "Language":"es"
            }
         ],
         "Contact":[
            {
               "Id":"48012",
               "URI":"http://www.usa.gov/api/USAGovAPI/contacts.json/contact/48012",
               "Language":"en",
               "Name":"Center for Nutrition Policy and Promotion (CNPP)",
               "Source_Url":"http://www.usa.gov/directory/federal/center-for-nutrition-policy-and-promotion.shtml",
               "Street1":"3101 Park Center Dr., 10th Floor",
               "City":"Alexandria",
               "StateTer":"VA",
               "Zip":"22302-1594",
               "Phone":[
                  "703-305-7600"
               ],
               "Contact_Url":[
                  {
                     "Url":"http://www.cnpp.usda.gov/contacts.htm",
                     "Description":"Contact the Center for Nutrition Policy and Promotion (CNPP) ",
                     "Language":"en"
                  }
               ],
               "Web_Url":[
                  {
                     "Url":"http://www.cnpp.usda.gov/",
                     "Description":"Center for Nutrition Policy and Promotion (CNPP) ",
                     "Language":"en"
                  },
                  {
                     "Url":"http://www.choosemyplate.gov/",
                     "Description":"",
                     "Language":"en"
                  }
               ],
               "Description":"The USDA Center for Nutrition Policy and Promotion (CNPP) works to improve the health and well-being of Americans by developing and promoting dietary guidance that links scientific research to the nutrition needs of consumers."
            }
         ]
      }
   ]
}

For a complete list of fields returned in the json, see the data model description above. Please note that any field that contains more than one item in it (such as synonyms), is returned as an array and noted in the data model description.

We encourage you to try out the interactive documentation to learn more.

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API Methods That Return Agency Records in a Tree Form

These methods return agency records in a hierarchical data structure. In this way, you do not have to manually recreate the hierarchy yourself using the contacts method.

/contact/{identifier}/tree/parent

The parent method returns the record of the parent agency specified in the REST URL and will continue up the agency hierarchy until the root agency is returned. Additionally, the record for the id specified will also be returned.

For example, if you request the parent tree for the Administration for Native Americans (agency id 49064) , the API will return a tree structure whose head is the U.S.  Department of Health and Human Services, with a child record for the Administration for Children and Families, which will then have a child record for the Administration of Native Americans.

With JSON-formatted results, this call would be made with this URL:  http://www.usa.gov/api/USAGovAPI/contacts.json/contact/49064/tree/parent

Likewise, if you request the parent tree for the Administration for Children and Families (agency id 47994), the API will return a tree structure whose head is the U.S. Department of Health and Human Services, with a child record for the Administration for Children and Families.  However, the structure will end at that point instead of continuing down the agency hierarchy.

With JSON-formatted results, this call would be made with this URL:  http://www.usa.gov/api/USAGovAPI/contacts.json/contact/47994/tree/parent

/contact/{identifier}/tree/descendant

The descendant method will return a tree with the agency specified in the REST URL at it’s head. It will include all of the agency's sub-agencies as children. The tree will then continue in this fashion until the agencies with no children are returned.

For example, if you request the descendant tree of the Administration for Children and Families (agency id 47994), the API will return a tree structure with the record for the Administration for Children and Families at it’s head. There would then be child record for the Administration of Native Americans, since that agency is a subagency of the Administration for Children and Families.

With JSON-formatted results, this call would be made with this URL: http://www.usa.gov/api/USAGovAPI/contacts.json/contact/47994/tree/descendant

Likewise, if you request the descendant tree of the U.S. Department of Health and Human Services (agency id 49021), the API will return a tree structure with the U.S. Department of Health and Human Services record at it’s head, and have 15 child records for each of the sub-agencies.  The tree will continue in this manner until the entire U.S. Department of Health and Human Services hierarchy of agencies is exposed.

With JSON-formatted results, this call would be made with this URL: http://www.usa.gov/api/USAGovAPI/contacts.json/contact/49021/tree/descendant

/contact/{identifier}/tree/branch

The branch method returns a tree that is the combination of the trees returned by the parent method and the descendant method for the id specified in the REST URL. With this one method, the API will return every parent and every descendant of a particular agency.

/contact/{identifier}

The contact/{identifier} method will return the single directory record represented by the id specified in the REST URL. There are no children records returned when using this method.

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Sample Results For These Methods

For API methods that return a tree of directory records, the API will return an array of objects, such as:

{
  "Id": "49021",
  "URI": "http://www.usa.gov/api/USAGovAPI/contacts.json/contact/49021",
  "Language": "en",
  "Name": "U.S. Department of Health and Human Services (HHS)",
  "Source_Url": "http://www.usa.gov/directory/federal/department-of-health-and-human-services.shtml",
  "Street1": "200 Independence Avenue, S.W.",
  "City": "Washington",
  "StateTer": "DC",
  "Zip": "20201",
  "Synonym": [
    "Health and Human Services Department",
    "Department of Health and Human Services"
  ],
  "Contact_Url": [
    {
      "Url": "http://www.hhs.gov/contactus.html",
      "Description": "Contact the U.S. Department of Health and Human Services (HHS) ",
      "Language": "en"
    },
    {
      "Url": "http://www.acf.hhs.gov/acf_contact_us.html#state",
      "Description": "Child Support",
      "Language": "en"
    },
    {
      "Url": "http://www.acf.hhs.gov/programs/ofa/help",
      "Description": "Temporary Assistance for Needy Families (Welfare)",
      "Language": "en"
    },
    {
      "Url": "http://www.medicare.gov/ContactUs.asp",
      "Description": "Medicare",
      "Language": "en"
    },
    {
      "Url": "http://www.acf.hhs.gov/programs/ocs/liheap/about/contact_us.html",
      "Description": "Low Income Home Energy Assistance Program (LIHEAP)",
      "Language": "en"
    },
    {
      "Url": "https://cfo.gov/cfo-members/",
      "Description": "Employee Directory",
      "Language": "en"
    }
  ],
  "Web_Url": [
    {
      "Url": "http://www.hhs.gov/",
      "Description": "U.S. Department of Health and Human Services (HHS) ",
      "Language": "en"
    }
  ],
  "In_Person_Url": [
    {
      "Url": "http://eclkc.ohs.acf.hhs.gov/hslc/HeadStartOffices",
      "Description": "Head Start Program Locator",
      "Language": "en"
    }
  ],
  "Description": "The Department of Health and Human Services protects the health of all Americans and provides essential human services.",
  "Alt_Language": [
    {
      "Id": "50081",
      "URI": "http://www.usa.gov/api/USAGovAPI/contacts.json/contact/50081",
      "Name": "Departamento de Salud y Servicios Sociales – HHS",
      "Language": "es"
    }
  ],
  "Contact": [
    {
      "Id": "47994",
      "URI": "http://www.usa.gov/api/USAGovAPI/contacts.json/contact/47994",
      "Language": "en",
      "Name": "Administration for Children and Families (ACF)",
      "Source_Url": "http://www.usa.gov/directory/federal/administration-for-children--families.shtml",
      "Street1": "370 L'nfant Promenade, SW",
      "City": "Washington",
      "StateTer": "DC",
      "Zip": "20447",
      "Tollfree": [
        "1-888-289-8442 (Fraud Alert Hotline)"
      ],
      "Contact_Url": [
        {
          "Url": "http://www.acf.hhs.gov/programs/ana/about",
          "Description": "Contact the Administration for Children and Families (ACF) ",
          "Language": "en"
        },
        {
          "Url": "https://cfo.gov/cfo-members/",
          "Description": "Employee Directory",
          "Language": "en"
        },
        {
          "Url": "http://www.acf.hhs.gov/acf_contact_us.html#state",
          "Description": "Child Support",
          "Language": "en"
        },
        {
          "Url": "http://www.acf.hhs.gov/programs/ofa/help",
          "Description": "Temporary Assistance for Needy Families (Welfare)",
          "Language": "en"
        },
        {
          "Url": "http://www.childwelfare.gov/pubs/reslist/rl_dsp.cfm?rs_id=5&rate_chno=11-11172",
          "Description": "Report Child Abuse and Neglect",
          "Language": "en"
        },
        {
          "Url": "http://www.acf.hhs.gov/programs/ocs/liheap/about/contact_us.html",
          "Description": "Low Income Home Energy Assistance Program (LIHEAP)",
          "Language": "en"
        }
      ],
      "Web_Url": [
        {
          "Url": "http://www.acf.hhs.gov/",
          "Description": "Administration for Children and Families (ACF) ",
          "Language": "en"
        }
      ],
      "In_Person_Url": [
        {
          "Url": "http://eclkc.ohs.acf.hhs.gov/hslc/HeadStartOffices",
          "Description": "Head Start Program Locator",
          "Language": "en"
        },
        {
          "Url": "http://www.acf.hhs.gov/programs/cse/extinf.html",
          "Description": "Child Support Enforcement in Your State",
          "Language": "en"
        }
      ],
      "Description": "The ACF funds state, territory, local, and tribal organizations to provide family assistance (welfare), child support, child care, Head Start, child welfare, and other programs relating to children and families.",
      "Alt_Language": [
        {
          "Id": "50101",
          "URI": "http://www.usa.gov/api/USAGovAPI/contacts.json/contact/50101",
          "Name": "Administración de Asuntos de Niños y Familias",
          "Language": "es"
        }
      ],
      "Contact": [
        {
          "Id": "49064",
          "URI": "http://www.usa.gov/api/USAGovAPI/contacts.json/contact/49064",
          "Language": "en",
          "Name": "Administration for Native Americans",
          "Source_Url": "http://www.usa.gov/directory/federal/administration-for-native-americans.shtml",
          "Street1": "2nd Floor, West Aerospace Center",
          "Street2": "370 L'Enfant Promenade, SW",
          "City": "Washington",
          "StateTer": "DC",
          "Zip": "20447-0002",
          "Tollfree": [
            "877-922-9262"
          ],
          "Email": "anacomments@acf.hhs.gov",
          "Contact_Url": [
            {
              "Url": "http://www.acf.hhs.gov/programs/ana/about",
              "Description": "Contact the Administration for Native Americans ",
              "Language": "en"
            }
          ],
          "Web_Url": [
            {
              "Url": "http://www.acf.hhs.gov/programs/ana/",
              "Description": "Administration for Native Americans ",
              "Language": "en"
            }
          ],
          "Description": "The Administration for Native Americans promotes self-sufficiency and cultural preservation for Native Americans by providing social and economic development opportunities through financial assistance, training, and technical assistance.",
          "Alt_Language": [
            {
              "Id": "50125",
              "URI": "http://www.usa.gov/api/USAGovAPI/contacts.json/contact/50125",
              "Name": "Oficina de Asuntos Nativo Americanos",
              "Language": "es"
            }
          ]
        }
      ]
    }
  ]
}

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The Freestatetaxreturns

Freestatetaxreturns 5. Freestatetaxreturns   Exemptions, Deductions, and Credits Table of Contents Topics - This chapter discusses: Useful Items - You may want to see: Items Related to Excluded Income Exemptions Contributions to Foreign Charitable Organizations Moving ExpensesAllocation of Moving Expenses Forms To File Contributions to Individual Retirement Arrangements Taxes of Foreign Countries and U. Freestatetaxreturns S. Freestatetaxreturns PossessionsCredit for Foreign Income Taxes Deduction for Foreign Income Taxes Deduction for Other Foreign Taxes How To Report Deductions Topics - This chapter discusses: The rules concerning items related to excluded income, Exemptions, Contributions to foreign charitable organizations, Moving expenses, Contributions to individual retirement arrangements (IRAs), Taxes of foreign countries and U. Freestatetaxreturns S. Freestatetaxreturns possessions, and How to report deductions. Freestatetaxreturns Useful Items - You may want to see: Publication 501 Exemptions, Standard Deduction, and Filing Information 514 Foreign Tax Credit for Individuals 521 Moving Expenses 523 Selling Your Home 590 Individual Retirement Arrangements (IRAs) 597 Information on the United States—Canada Income Tax Treaty Form (and Instructions) 1116 Foreign Tax Credit 2106 Employee Business Expenses 2555 Foreign Earned Income 2555-EZ Foreign Earned Income Exclusion 3903 Moving Expenses Schedule A (Form 1040) Itemized Deductions Schedule C (Form 1040) Profit or Loss From Business SS-5 Application for a Social Security Card W-7 Application for IRS Individual Taxpayer Identification Number See chapter 7 for information about getting these publications and forms. Freestatetaxreturns Items Related to Excluded Income U. Freestatetaxreturns S. Freestatetaxreturns citizens and resident aliens living outside the United States generally are allowed the same deductions as citizens and residents living in the United States. Freestatetaxreturns If you choose to exclude foreign earned income or housing amounts, you cannot deduct, exclude, or claim a credit for any item that can be allocated to or charged against the excluded amounts. Freestatetaxreturns This includes any expenses, losses, and other normally deductible items that are allocable to the excluded income. Freestatetaxreturns You can deduct only those expenses connected with earning includible income. Freestatetaxreturns These rules apply only to items definitely related to the excluded earned income and they do not apply to other items that are not definitely related to any particular type of gross income. Freestatetaxreturns These rules do not apply to items such as: Personal exemptions, Qualified retirement contributions, Alimony payments, Charitable contributions, Medical expenses, Mortgage interest, or Real estate taxes on your personal residence. Freestatetaxreturns For purposes of these rules, your housing deduction is not treated as allocable to your excluded income, but the deduction for self- employment tax is. Freestatetaxreturns If you receive foreign earned income in a tax year after the year in which you earned it, you may have to file an amended return for the earlier year to properly adjust the amounts of deductions, credits, or exclusions allocable to your foreign earned income and housing exclusions. Freestatetaxreturns Example. Freestatetaxreturns In 2012, you had $90,400 of foreign earned income and $9,500 of deductions allocable to your foreign earned income. Freestatetaxreturns You did not have a housing exclusion. Freestatetaxreturns Because you excluded all of your foreign earned income, you would not have been able to claim any of the deductions on your 2012 return. Freestatetaxreturns In 2013, you received a $12,000 bonus for work you did abroad in 2012. Freestatetaxreturns You can exclude $4,700 of the bonus because the limit on the foreign earned income exclusion for 2012 was $95,100 and you have already excluded $90,400. Freestatetaxreturns Since you must include $7,300 of the bonus ($12,000 − $4,700) for work you did in 2012 in income, you can file an amended return for 2012 to claim $677 of the deductions. Freestatetaxreturns This is the deductions allocable to the foreign earned income ($9,500) multiplied by the includible portion of the foreign earned income ($7,300) and divided by the total foreign earned income for 2012 ($102,400). Freestatetaxreturns Exemptions You can claim an exemption for your nonresident alien spouse on your separate return, provided your spouse has no gross income for U. Freestatetaxreturns S. Freestatetaxreturns tax purposes and is not the dependent of another U. Freestatetaxreturns S. Freestatetaxreturns taxpayer. Freestatetaxreturns You also can claim exemptions for individuals who qualify as your dependents. Freestatetaxreturns To be your dependent, the individual must be a U. Freestatetaxreturns S. Freestatetaxreturns citizen, U. Freestatetaxreturns S. Freestatetaxreturns national, U. Freestatetaxreturns S. Freestatetaxreturns resident alien, or a resident of Canada or Mexico for some part of the calendar year in which your tax year begins. Freestatetaxreturns Children. Freestatetaxreturns   Children usually are citizens or residents of the same country as their parents. Freestatetaxreturns If you were a U. Freestatetaxreturns S. Freestatetaxreturns citizen when your child was born, your child generally is a U. Freestatetaxreturns S. Freestatetaxreturns citizen. Freestatetaxreturns This is true even if the child's other parent is a nonresident alien, the child was born in a foreign country, and the child lives abroad with the other parent. Freestatetaxreturns   If you have a legally adopted child who is not a U. Freestatetaxreturns S. Freestatetaxreturns citizen, U. Freestatetaxreturns S. Freestatetaxreturns resident, or U. Freestatetaxreturns S. Freestatetaxreturns national, the child meets the citizen requirement if you are a U. Freestatetaxreturns S. Freestatetaxreturns citizen or U. Freestatetaxreturns S. Freestatetaxreturns national and the child lived with you as a member of your household all year. Freestatetaxreturns Social security number. Freestatetaxreturns   You must include on your return the social security number (SSN) of each dependent for whom you claim an exemption. Freestatetaxreturns To get a social security number for a dependent, apply at a Social Security office or U. Freestatetaxreturns S. Freestatetaxreturns consulate. Freestatetaxreturns You must provide original or certified copies of documents to verify the dependent's age, identity, and citizenship, and complete Form SS-5. Freestatetaxreturns   If you do not have an SSN for a child who was born in 2013 and died in 2013, attach a copy of the child's birth certificate to your tax return. Freestatetaxreturns Print “Died” in column (2) of line 6c of your Form 1040 or Form 1040A. Freestatetaxreturns   If your dependent is a nonresident alien who is not eligible to get a social security number, you must list the dependent's individual taxpayer identification number (ITIN) instead of an SSN. Freestatetaxreturns To apply for an ITIN, file Form W-7 with the IRS. Freestatetaxreturns It usually takes 6 to 10 weeks to get an ITIN. Freestatetaxreturns Enter your dependent's ITIN wherever an SSN is requested on your tax return. Freestatetaxreturns More information. Freestatetaxreturns   For more information about exemptions, see Publication 501. Freestatetaxreturns Contributions to Foreign Charitable Organizations If you make contributions directly to a foreign church or other foreign charitable organization, you generally cannot deduct them. Freestatetaxreturns Exceptions are explained under Canadian, Mexican, and Israeli charities, later. Freestatetaxreturns You can deduct contributions to a U. Freestatetaxreturns S. Freestatetaxreturns organization that transfers funds to a charitable foreign organization if the U. Freestatetaxreturns S. Freestatetaxreturns organization controls the use of the funds by the foreign organization or if the foreign organization is just an administrative arm of the U. Freestatetaxreturns S. Freestatetaxreturns organization. Freestatetaxreturns Canadian, Mexican, and Israeli charities. Freestatetaxreturns   Under the income tax treaties with Canada, Mexico and Israel, you may be able to deduct contributions to certain Canadian, Mexican, and Israeli charitable organizations. Freestatetaxreturns Generally, you must have income from sources in Canada, Mexico, or Israel, and the organization must meet certain requirements. Freestatetaxreturns See Publication 597, Information on the United States-Canada Income Tax Treaty, and Publication 526, Charitable Contributions, for more information. Freestatetaxreturns Moving Expenses If you moved to a new home in 2013 because of your job or business, you may be able to deduct the expenses of your move. Freestatetaxreturns Generally, to be deductible, the moving expenses must have been paid or incurred in connection with starting work at a new job location. Freestatetaxreturns See Publication 521 for a complete discussion of the deduction for moving expenses and information about moves within the United States. Freestatetaxreturns Foreign moves. Freestatetaxreturns   A foreign move is a move in connection with the start of work at a new job location outside the United States and its possessions. Freestatetaxreturns A foreign move does not include a move back to the United States or its possessions. Freestatetaxreturns Allocation of Moving Expenses When your new place of work is in a foreign country, your moving expenses are directly connected with the income earned in that foreign country. Freestatetaxreturns If you exclude all or part of the income that you earn at the new location under the foreign earned income exclusion or the foreign housing exclusion, you cannot deduct the part of your moving expense that is allocable to the excluded income. Freestatetaxreturns Also, you cannot deduct the part of the moving expense related to the excluded income for a move from a foreign country to the United States if you receive a reimbursement that you are able to treat as compensation for services performed in the foreign country. Freestatetaxreturns Year to which expense is connected. Freestatetaxreturns   The moving expense is connected with earning the income (including reimbursements, as discussed in chapter 4 under Reimbursement of moving expenses ) either entirely in the year of the move or in 2 years. Freestatetaxreturns It is connected with earning the income entirely in the year of the move if you qualify for the foreign earned income exclusion under the bona fide residence test or physical presence test for at least 120 days during that tax year. Freestatetaxreturns   If you do not qualify under either the bona fide residence test or the physical presence test for at least 120 days during the year of the move, the expense is connected with earning the income in 2 years. Freestatetaxreturns The moving expense is connected with the year of the move and the following year if the move is from the United States to a foreign country. Freestatetaxreturns The moving expense is connected with the year of the move and the preceding year if the move is from a foreign country to the United States. Freestatetaxreturns Amount allocable to excluded income. Freestatetaxreturns   To figure the amount of your moving expense that is allocable to your excluded foreign earned income (and not deductible), you must multiply your total moving expense deduction by a fraction. Freestatetaxreturns The numerator (top number) of the fraction is the total of your excluded foreign earned income and housing amounts for both years and the denominator (bottom number) of the fraction is your total foreign earned income for both years. Freestatetaxreturns Example. Freestatetaxreturns On November 1, 2012, you transfer to Monaco. Freestatetaxreturns Your tax home is in Monaco, and you are a bona fide resident of Monaco for the entire tax year 2013. Freestatetaxreturns In 2012, you paid $6,000 for allowable moving expenses for your move from the United States to Monaco. Freestatetaxreturns You were fully reimbursed (under a nonaccountable plan) for these expenses in the same year. Freestatetaxreturns The reimbursement is included in your income. Freestatetaxreturns Your only other income consists of $16,000 wages earned in 2012 after the date of your move, and $100,100 wages earned in Monaco for 2013. Freestatetaxreturns Because you did not meet the bona fide residence test for at least 120 days during 2012, the year of the move, the moving expenses are for services you performed in both 2012 and the following year, 2013. Freestatetaxreturns Your total foreign earned income for both years is $122,100, consisting of $16,000 wages for 2012, $100,100 wages for 2013, and $6,000 moving expense reimbursement for both years. Freestatetaxreturns You have no housing exclusion. Freestatetaxreturns The total amount you can exclude is $113,190, consisting of the $97,600 full-year exclusion for 2013 and a $15,590 part-year exclusion for 2012 ($95,100 times the fraction of 60 qualifying bona fide residence days over 366 total days in the year). Freestatetaxreturns To find the part of your moving expenses that is not deductible, multiply your $6,000 total expenses by the fraction $113,190 over $122,100. Freestatetaxreturns The result, $5,562, is your nondeductible amount. Freestatetaxreturns    You must report the full amount of the moving expense reimbursement in the year in which you received the reimbursement. Freestatetaxreturns In the preceding example, this year was 2012. Freestatetaxreturns You attribute the reimbursement to both 2012 and 2013 only to figure the amount of foreign earned income eligible for exclusion for each year. Freestatetaxreturns Move between foreign countries. Freestatetaxreturns   If you move between foreign countries, your moving expense is allocable to income earned in the year of the move if you qualified under either the bona fide residence test or the physical presence test for a period that includes at least 120 days in the year of the move. Freestatetaxreturns New place of work in U. Freestatetaxreturns S. Freestatetaxreturns   If your new place of work is in the United States, the deductible moving expenses are directly connected with the income earned in the United States. Freestatetaxreturns If you treat a reimbursement from your employer as foreign earned income (see the discussion in chapter 4), you must allocate deductible moving expenses to foreign earned income. Freestatetaxreturns Storage expenses. Freestatetaxreturns   These expenses are attributable to work you do during the year in which you incur the storage expenses. Freestatetaxreturns You cannot deduct the amount allocable to excluded income. Freestatetaxreturns Moving Expense Attributable to Foreign Earnings in 2 Years If your moving expense deduction is attributable to your foreign earnings in 2 years (the year of the move and the following year), you should request an extension of time to file your return for the year of the move until after the end of the second year. Freestatetaxreturns By then, you should have all the information needed to properly figure the moving expense deduction. Freestatetaxreturns See Extensions under When To File and Pay in chapter 1. Freestatetaxreturns If you do not request an extension, you should figure the part of the moving expense that you cannot deduct because it is allocable to the foreign earned income you are excluding. Freestatetaxreturns You do this by multiplying the moving expense by a fraction, the numerator (top number) of which is your excluded foreign earned income for the year of the move, and the denominator (bottom number) of which is your total foreign earned income for the year of the move. Freestatetaxreturns Once you know your foreign earnings and exclusion for the following year, you must either: Adjust the moving expense deduction by filing an amended return for the year of the move, or Recapture any additional unallowable amount as income on your return for the following year. Freestatetaxreturns If, after you make the final computation, you have an additional amount of allowable moving expense deduction, you can claim this only on an amended return for the year of the move. Freestatetaxreturns You cannot claim it on the return for the second year. Freestatetaxreturns Forms To File Report your moving expenses on Form 3903. Freestatetaxreturns Report your moving expense deduction on line 26 of Form 1040. Freestatetaxreturns If you must reduce your moving expenses by the amount allocable to excluded income (as explained later under How To Report Deductions ), attach a statement to your return showing how you figured this amount. Freestatetaxreturns For more information about figuring moving expenses, see Publication 521. Freestatetaxreturns Contributions to Individual Retirement Arrangements Contributions to your individual retirement arrangements (IRAs) that are traditional IRAs or Roth IRAs are generally limited to the lesser of $5,500 ($6,500 if 50 or older) or your compensation that is includible in your gross income for the tax year. Freestatetaxreturns In determining compensation for this purpose, do not take into account amounts you exclude under either the foreign earned income exclusion or the foreign housing exclusion. Freestatetaxreturns Do not reduce your compensation by the foreign housing deduction. Freestatetaxreturns If you are covered by an employer retirement plan at work, your deduction for your contributions to your traditional IRAs is generally limited based on your modified adjusted gross income. Freestatetaxreturns This is your adjusted gross income figured without taking into account the foreign earned income exclusion, the foreign housing exclusion, or the foreign housing deduction. Freestatetaxreturns Other modifications are also required. Freestatetaxreturns For more information on IRAs, see Publication 590. Freestatetaxreturns Taxes of Foreign Countries and U. Freestatetaxreturns S. Freestatetaxreturns Possessions You can take either a credit or a deduction for income taxes paid to a foreign country or a U. Freestatetaxreturns S. Freestatetaxreturns possession. Freestatetaxreturns Taken as a deduction, foreign income taxes reduce your taxable income. Freestatetaxreturns Taken as a credit, foreign income taxes reduce your tax liability. Freestatetaxreturns You must treat all foreign income taxes the same way. Freestatetaxreturns If you take a credit for any foreign income taxes, you cannot deduct any foreign income taxes. Freestatetaxreturns However, you may be able to deduct other foreign taxes. Freestatetaxreturns See Deduction for Other Foreign Taxes, later. Freestatetaxreturns There is no rule to determine whether it is to your advantage to take a deduction or a credit for foreign income taxes. Freestatetaxreturns In most cases, it is to your advantage to take foreign income taxes as a tax credit, which you subtract directly from your U. Freestatetaxreturns S. Freestatetaxreturns tax liability, rather than as a deduction in figuring taxable income. Freestatetaxreturns However, if foreign income taxes were imposed at a high rate and the proportion of foreign income to U. Freestatetaxreturns S. Freestatetaxreturns income is small, a lower final tax may result from deducting the foreign income taxes. Freestatetaxreturns In any event, you should figure your tax liability both ways and then use the one that is better for you. Freestatetaxreturns You can make or change your choice within 10 years from the due date for filing the tax return on which you are entitled to take either the deduction or the credit. Freestatetaxreturns Foreign income taxes. Freestatetaxreturns   These are generally income taxes you pay to any foreign country or possession of the United States. Freestatetaxreturns Foreign income taxes on U. Freestatetaxreturns S. Freestatetaxreturns return. Freestatetaxreturns   Foreign income taxes can only be taken as a credit on Form 1040, line 47, or as an itemized deduction on Schedule A. Freestatetaxreturns These amounts cannot be included as withheld income taxes on Form 1040, line 62. Freestatetaxreturns Foreign taxes paid on excluded income. Freestatetaxreturns   You cannot take a credit or deduction for foreign income taxes paid on earnings you exclude from tax under any of the following. Freestatetaxreturns Foreign earned income exclusion. Freestatetaxreturns Foreign housing exclusion. Freestatetaxreturns Possession exclusion. Freestatetaxreturns If your wages are completely excluded, you cannot deduct or take a credit for any of the foreign taxes paid on your wages. Freestatetaxreturns   If only part of your wages is excluded, you cannot deduct or take a credit for the foreign income taxes allocable to the excluded part. Freestatetaxreturns You find the taxes allocable to your excluded wages by applying a fraction to the foreign taxes paid on foreign earned income received during the tax year. Freestatetaxreturns The numerator (top number) of the fraction is your excluded foreign earned income received during the tax year minus deductible expenses allocable to that income (not including the foreign housing deduction). Freestatetaxreturns The denominator (bottom number) of the fraction is your total foreign earned income received during the tax year minus all deductible expenses allocable to that income (including the foreign housing deduction). Freestatetaxreturns   If foreign law taxes both earned income and some other type of income and the taxes on the other type cannot be separated, the denominator of the fraction is the total amount of income subject to foreign tax minus deductible expenses allocable to that income. Freestatetaxreturns    If you take a foreign tax credit for tax on income you could have excluded under your choice to exclude foreign earned income or your choice to exclude foreign housing costs, one or both of the choices may be considered revoked. Freestatetaxreturns Credit for Foreign Income Taxes If you take the foreign tax credit, you may have to file Form 1116 with Form 1040. Freestatetaxreturns Form 1116 is used to figure the amount of foreign tax paid or accrued that can be claimed as a foreign tax credit. Freestatetaxreturns Do not include the amount of foreign tax paid or accrued as withheld federal income taxes on Form 1040, line 62. Freestatetaxreturns The foreign income tax for which you can claim a credit is the amount of legal and actual tax liability you pay or accrue during the year. Freestatetaxreturns The amount for which you can claim a credit is not necessarily the amount withheld by the foreign country. Freestatetaxreturns You cannot take a foreign tax credit for income tax you paid to a foreign country that would be refunded by the foreign country if you made a claim for refund. Freestatetaxreturns Subsidies. Freestatetaxreturns   If a foreign country returns your foreign tax payments to you in the form of a subsidy, you cannot claim a foreign tax credit based on these payments. Freestatetaxreturns This rule applies to a subsidy provided by any means that is determined, directly or indirectly, by reference to the amount of tax, or to the base used to figure the tax. Freestatetaxreturns   Some ways of providing a subsidy are refunds, credits, deductions, payments, or discharges of obligations. Freestatetaxreturns A credit is also not allowed if the subsidy is given to a person related to you, or persons who participated in a transaction or a related transaction with you. Freestatetaxreturns Limit The foreign tax credit is limited to the part of your total U. Freestatetaxreturns S. Freestatetaxreturns tax that is in proportion to your taxable income from sources outside the United States compared to your total taxable income. Freestatetaxreturns The allowable foreign tax credit cannot be more than your actual foreign tax liability. Freestatetaxreturns Exemption from limit. Freestatetaxreturns   You will not be subject to this limit and will not have to file Form 1116 if you meet all three of the following requirements. Freestatetaxreturns Your only foreign source income for the year is passive income (dividends, interest, royalties, etc. Freestatetaxreturns ) that is reported to you on a payee statement (such as a Form 1099-DIV or 1099-INT). Freestatetaxreturns Your foreign taxes for the year that qualify for the credit are not more than $300 ($600 if you are filing a joint return) and are reported on a payee statement. Freestatetaxreturns You elect this procedure. Freestatetaxreturns If you make this election, you cannot carry back or carry over any unused foreign tax to or from this year. Freestatetaxreturns Separate limit. Freestatetaxreturns   You must figure the limit on a separate basis with regard to “passive category income” and “general category income” (see the instructions for Form 1116). Freestatetaxreturns Figuring the limit. Freestatetaxreturns   In figuring taxable income in each category, you take into account only the amount that you must include in income on your federal tax return. Freestatetaxreturns Do not take any excluded amount into account. Freestatetaxreturns   To determine your taxable income in each category, deduct expenses and losses that are definitely related to that income. Freestatetaxreturns   Other expenses (such as itemized deductions or the standard deduction) not definitely related to specific items of income must be apportioned to the foreign income in each category by multiplying them by a fraction. Freestatetaxreturns The numerator (top number) of the fraction is your gross foreign income in the separate limit category. Freestatetaxreturns The denominator (bottom number) of the fraction is your gross income from all sources. Freestatetaxreturns For this purpose, gross income includes income that is excluded under the foreign earned income provisions but does not include any other exempt income. Freestatetaxreturns You must use special rules for deducting interest expenses. Freestatetaxreturns For more information on allocating and apportioning your deductions, see Publication 514. Freestatetaxreturns Exemptions. Freestatetaxreturns   Do not take the deduction for exemptions for yourself, your spouse, or your dependents in figuring taxable income for purposes of the limit. Freestatetaxreturns Recapture of foreign losses. Freestatetaxreturns   If you have an overall foreign loss and the loss reduces your U. Freestatetaxreturns S. Freestatetaxreturns source income (resulting in a reduction of your U. Freestatetaxreturns S. Freestatetaxreturns tax liability), you must recapture the loss in later years when you have taxable income from foreign sources. Freestatetaxreturns This is done by treating a part of your taxable income from foreign sources in later years as U. Freestatetaxreturns S. Freestatetaxreturns source income. Freestatetaxreturns This reduces the numerator of the limiting fraction and the resulting foreign tax credit limit. Freestatetaxreturns Recapture of domestic losses. Freestatetaxreturns   If you have an overall domestic loss (resulting in no U. Freestatetaxreturns S. Freestatetaxreturns tax liability), you cannot claim a foreign tax credit for taxes paid during that year. Freestatetaxreturns You must recapture the loss in later years when you have U. Freestatetaxreturns S. Freestatetaxreturns source taxable income. Freestatetaxreturns This is done by treating a part of your taxable income from U. Freestatetaxreturns S. Freestatetaxreturns sources in later years as foreign source income. Freestatetaxreturns This increases the numerator of the limiting fraction and the resulting foreign tax credit limit. Freestatetaxreturns Foreign tax credit carryback and carryover. Freestatetaxreturns   The amount of foreign income tax not allowed as a credit because of the limit can be carried back 1 year and carried forward 10 years. Freestatetaxreturns   More information on figuring the foreign tax credit can be found in Publication 514. Freestatetaxreturns Deduction for Foreign Income Taxes Instead of taking the foreign tax credit, you can deduct foreign income taxes as an itemized deduction on Schedule A (Form 1040). Freestatetaxreturns You can deduct only foreign income taxes paid on income that is subject to U. Freestatetaxreturns S. Freestatetaxreturns tax. Freestatetaxreturns You cannot deduct foreign taxes paid on earnings you exclude from tax under any of the following. Freestatetaxreturns Foreign earned income exclusion. Freestatetaxreturns Foreign housing exclusion. Freestatetaxreturns Possession exclusion. Freestatetaxreturns Example. Freestatetaxreturns You are a U. Freestatetaxreturns S. Freestatetaxreturns citizen and qualify to exclude your foreign earned income. Freestatetaxreturns Your excluded wages in Country X are $70,000 on which you paid income tax of $10,000. Freestatetaxreturns You received dividends from Country X of $2,000 on which you paid income tax of $600. Freestatetaxreturns You can deduct the $600 tax payment because the dividends relating to it are subject to U. Freestatetaxreturns S. Freestatetaxreturns tax. Freestatetaxreturns Because you exclude your wages, you cannot deduct the income tax of $10,000. Freestatetaxreturns If you exclude only a part of your wages, see the earlier discussion under Foreign taxes paid on excluded income. Freestatetaxreturns Deduction for Other Foreign Taxes You can deduct real property taxes you pay that are imposed on you by a foreign country. Freestatetaxreturns You take this deduction on Schedule A (Form 1040). Freestatetaxreturns You cannot deduct other foreign taxes, such as personal property taxes, unless you incurred the expenses in a trade or business or in the production of income. Freestatetaxreturns On the other hand, you generally can deduct personal property taxes when you pay them to U. Freestatetaxreturns S. Freestatetaxreturns possessions. Freestatetaxreturns But if you claim the possession exclusion, see Publication 570. Freestatetaxreturns The deduction for foreign taxes other than foreign income taxes is not related to the foreign tax credit. Freestatetaxreturns You can take deductions for these miscellaneous foreign taxes and also claim the foreign tax credit for income taxes imposed by a foreign country. Freestatetaxreturns How To Report Deductions If you exclude foreign earned income or housing amounts, how you show your deductions on your tax return and how you figure the amount allocable to your excluded income depends on whether the expenses are used in figuring adjusted gross income (Form 1040, line 38) or are itemized deductions. Freestatetaxreturns If you have deductions used in figuring adjusted gross income, enter the total amount for each of these items on the appropriate lines and schedules of Form 1040. Freestatetaxreturns Generally, you figure the amount of a deduction related to the excluded income by multiplying the deduction by a fraction, the numerator of which is your foreign earned income exclusion and the denominator of which is your foreign earned income. Freestatetaxreturns Enter the amount of the deduction(s) related to excluded income on line 44 of Form 2555. Freestatetaxreturns If you have itemized deductions related to excluded income, enter on Schedule A (Form 1040) only the part not related to excluded income. Freestatetaxreturns You figure that amount by subtracting from the total deduction the amount related to excluded income. Freestatetaxreturns Generally, you figure the amount that is related to the excluded income by multiplying the total deduction by a fraction, the numerator of which is your foreign earned income exclusion and the denominator of which is your foreign earned income. Freestatetaxreturns Attach a statement to your return showing how you figured the deductible amount. Freestatetaxreturns Example 1. Freestatetaxreturns You are a U. Freestatetaxreturns S. Freestatetaxreturns citizen employed as an accountant. Freestatetaxreturns Your tax home is in Germany for the entire tax year. Freestatetaxreturns You meet the physical presence test. Freestatetaxreturns Your foreign earned income for the year was $122,000 and your investment income was $10,380. Freestatetaxreturns After excluding $97,600, your AGI is $34,780. Freestatetaxreturns You had unreimbursed business expenses of $2,500 for travel and entertainment in earning your foreign income, of which $500 was for meals and entertainment. Freestatetaxreturns These expenses are deductible only as miscellaneous deductions on Schedule A (Form 1040). Freestatetaxreturns You also have $500 of miscellaneous expenses that are not related to your foreign income that you enter on line 23 of Schedule A. Freestatetaxreturns You must fill out Form 2106. Freestatetaxreturns On that form, reduce your deductible meal and entertainment expenses by 50% ($250). Freestatetaxreturns You must reduce the remaining $2,250 of travel and entertainment expenses by 80% ($1,800) because you excluded 80% ($97,600/$122,000) of your foreign earned income. Freestatetaxreturns You carry the remaining total of $450 to line 21 of Schedule A. Freestatetaxreturns Add the $450 to the $500 that you have on line 23 and enter the total ($950) on line 24. Freestatetaxreturns On line 26 of Schedule A, enter $696, which is 2% of your adjusted gross income of $34,780 (line 38, Form 1040) and subtract it from the amount on line 24. Freestatetaxreturns Enter $254 on line 27 of Schedule A. Freestatetaxreturns Example 2. Freestatetaxreturns You are a U. Freestatetaxreturns S. Freestatetaxreturns citizen, have a tax home in Spain, and meet the physical presence test. Freestatetaxreturns You are self-employed and personal services produce the business income. Freestatetaxreturns Your gross income was $116,931, business expenses $66,895, and net income (profit) $50,036. Freestatetaxreturns You choose the foreign earned income exclusion and exclude $97,600 of your gross income. Freestatetaxreturns Since your excluded income is 83. Freestatetaxreturns 47% of your total income, 83. Freestatetaxreturns 47% of your business expenses are not deductible. Freestatetaxreturns Report your total income and expenses on Schedule C (Form 1040). Freestatetaxreturns On Form 2555 you will show the following: Line 20a, $116,931, gross income, Lines 42 and 43, $97,600, foreign earned income exclusion, and Line 44, $55,837 (83. Freestatetaxreturns 47% × $66,895) business expenses attributable to the exclusion. Freestatetaxreturns In this situation (Example 2), you cannot use Form 2555-EZ since you had self-employment income and business expenses. Freestatetaxreturns Example 3. Freestatetaxreturns Assume in Example 2 that both capital and personal services combine to produce the business income. Freestatetaxreturns No more than 30% of your net income, or $15,011, assuming that this amount is a reasonable allowance for your services, is considered earned and can be excluded. Freestatetaxreturns Your exclusion of $15,011 is 12. Freestatetaxreturns 84% of your gross income ($15,011 ÷ $116,931). Freestatetaxreturns Because you excluded 12. Freestatetaxreturns 84% of your total income, $8,589 (. Freestatetaxreturns 1284 x $66,895) of your business expenses is attributable to the excluded income and is not deductible. Freestatetaxreturns Example 4. Freestatetaxreturns You are a U. Freestatetaxreturns S. Freestatetaxreturns citizen, have a tax home in Brazil, and meet the physical presence test. Freestatetaxreturns You are self-employed and both capital and personal services combine to produce business income. Freestatetaxreturns Your gross income was $146,000, business expenses were $172,000, and your net loss was $26,000. Freestatetaxreturns A reasonable allowance for the services you performed for the business is $77,000. Freestatetaxreturns Because you incurred a net loss, the earned income limit of 30% of your net profit does not apply. Freestatetaxreturns The $77,000 is foreign earned income. Freestatetaxreturns If you choose to exclude the $77,000, you exclude 52. Freestatetaxreturns 74% of your gross income ($77,000 ÷ $146,000), and 52. Freestatetaxreturns 74% of your business expenses ($90,713) is attributable to that income and is not deductible. Freestatetaxreturns Show your total income and expenses on Schedule C (Form 1040). Freestatetaxreturns On Form 2555, exclude $77,000 and show $90,713 on line 44. Freestatetaxreturns Subtract line 44 from line 43, and enter the difference as a negative (in parentheses) on line 45. Freestatetaxreturns Because this amount is negative, enter it as a positive (no parentheses) on line 21, Form 1040, and combine it with your other income to arrive at total income on line 22 of Form 1040. Freestatetaxreturns In this situation (Example 4), you would probably not want to choose the foreign earned income exclusion if this was the first year you were eligible. Freestatetaxreturns If you had chosen the exclusion in an earlier year, you might want to revoke the choice for this year. Freestatetaxreturns To do so would mean that you could not claim the exclusion again for the next 5 tax years without IRS approval. Freestatetaxreturns See Choosing the Exclusion in chapter 4. Freestatetaxreturns Example 5. Freestatetaxreturns You are a U. Freestatetaxreturns S. Freestatetaxreturns citizen, have a tax home in Panama, and meet the bona fide residence test. Freestatetaxreturns You have been performing services for clients as a partner in a firm that provides services exclusively in Panama. Freestatetaxreturns Capital investment is not material in producing the partnership's income. Freestatetaxreturns Under the terms of the partnership agreement, you are to receive 50% of the net profits. Freestatetaxreturns The partnership received gross income of $244,000 and incurred operating expenses of $98,250. Freestatetaxreturns Of the net profits of $145,750, you received $72,875 as your distributive share. Freestatetaxreturns You choose to exclude $97,600 of your share of the gross income. Freestatetaxreturns Because you exclude 80% ($97,600 ÷ $122,000) of your share of the gross income, you cannot deduct $39,300, 80% of your share of the operating expenses (. Freestatetaxreturns 80 × $49,125). Freestatetaxreturns Report $72,875, your distributive share of the partnership net profit, on Schedule E (Form 1040), Supplemental Income and Loss. Freestatetaxreturns On Form 2555, show $97,600 on line 42 and show $39,300 on line 44. Freestatetaxreturns Your exclusion on Form 2555 is $58,300. Freestatetaxreturns In this situation (Example 5), you cannot use Form 2555-EZ since you had earned income other than salaries and wages and you had business expenses. Freestatetaxreturns Prev  Up  Next   Home   More Online Publications