Credit for Withholding & Estimated Tax

When you file your 2001 income tax return, take credit for all the income tax and excess social security or railroad retirement tax withheld from your salary, wages, pensions, etc. Also, take credit for the estimated tax you paid for 2001. These credits are subtracted from your tax. You should file a return and claim these credits, even if you do not owe tax.

If you had two or more employers and were paid wages of more than $80,400 during 2001, too much social security or railroad retirement tax may have been withheld from your wages. See Credit for Excess Social Security Tax or Railroad Retirement Tax Withheld in chapter 38.

Withholding

If you had income tax withheld during 2001, you should receive a statement by January 31, 2002, showing your income and the tax withheld. Depending on the source of your income, you will receive:

• Form W-2, Wage and Tax Statement,
• Form W-2G, Certain Gambling Winnings, or
• A form in the 1099 series.

Forms W-2 and W-2G. You file Form W-2 with your income tax return. File Form W-2G with your return if it shows any federal income tax withheld from your winnings.

You should get at least two copies of each form you receive. Attach one copy to the front of your federal income tax return. Keep one copy for your records. You should also receive copies to file with your state and local returns.

Form W-2

Your employer should give you a Form W-2 for 2001 by January 31, 2002. You should receive a separate Form W-2 from each employer you worked for.

If you stop working before the end of the year, your employer can give you your Form W-2 at any time after you leave your job. However, your employer must give it to you by January 31 of the following year (or the next day that is not a Saturday, Sunday, or holiday if January 31 is a Saturday, Sunday, or holiday).

If you ask for the form, your employer must give it to you within 30 days after receiving your written request or within 30 days after your final wage payment, whichever is later.

If you have not received your Form W-2 by February 1, 2002, you should ask your employer for it. If you do not receive it by February 15, call the IRS.

Form W-2 shows your total pay and other compensation and the income tax, social security tax, and Medicare tax that was withheld during the year. Include the federal income tax withheld (as shown on Form W-2) on:

• Line 59 if you file Form 1040,
• Line 37 if you file Form 1040A, or
• Line 8 if you file Form 1040EZ.

Form W-2 is also used to report any taxable sick pay you received and any income tax withheld from your sick pay.

Form W-2G

If you had gambling winnings in 2001, the payer may have withheld 27 1/2% or 28% as income tax. If tax was withheld, the payer will give you a Form W-2G showing the amount you won and the amount of tax withheld.

Report the amounts you won on line 21 of Form 1040. Take credit for the tax withheld on line 59 of Form 1040. If you had gambling winnings, you must use Form 1040; you cannot use Form 1040A or Form 1040EZ.

The 1099 Series

Most forms in the 1099 series are not filed with your return. You should receive these forms by February 1, 2002. Keep these forms for your records. There are several different forms in this series, including:

• Form 1099-B, Proceeds From Broker and Barter Exchange Transactions,
• Form 1099-DIV, Dividends and Distributions,
• Form 1099-G, Certain Government and Qualified State Tuition Program Payments,
• Form 1099-INT, Interest Income,
• Form 1099-MISC, Miscellaneous Income,
• Form 1099-OID, Original Issue Discount,
• Form 1099-R, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc.,
• Form SSA-1099, Social Security Benefit Statement, and
• Form RRB-1099, Payments by the Railroad Retirement Board.

If you received the types of income reported on some forms in the 1099 series, you may not be able to use Form 1040A or Form 1040EZ. See the instructions to these forms for details.

Form 1099-R. Attach Form 1099-R to your return if box 4 shows federal income tax withheld. Include the amount withheld in the total on line 59 of Form 1040 or line 37 of Form 1040A. You cannot use Form 1040EZ if you received payments reported on Form 1099-R.

Backup withholding. If you were subject to backup withholding on income you received during 2001, include the amount withheld, as shown on your Form 1099, in the total on line 59 of Form 1040, or line 37 of Form 1040A.

Form Not Correct

If you receive a form with incorrect information on it, you should ask the payer for a corrected form. Call the telephone number or write to the address given for the payer on the form. The corrected Form W-2G or Form 1099 you receive will be marked "Corrected." A special form, Form W-2c, Corrected Wage and Tax Statement, is used to correct a Form W-2.

Form Received After Filing

If you file your return and you later receive a form for income that you did not include on your return, you should report the income and take credit for any income tax withheld by filing Form 1040X, Amended U.S. Individual Income Tax Return. See Amended Returns and Claims for Refund in chapter 1.

Separate Returns

If you are married but file a separate return, you can take credit only for the tax withheld from your own income. Do not include any amount withheld from your spouse's income. However, different rules may apply if you live in a community property state.

Community property states are listed in chapter 2. For more information on these rules, and some exceptions, see Publication 555, Community Property.

Fiscal Years

If you file your tax return on the basis of a fiscal year (a 12-month period ending on the last day of any month except December), you must follow special rules to determine your credit for federal income tax withholding. For a discussion of how to take credit for withholding on a fiscal year return, see Fiscal Years in chapter 3 of Publication 505.

Estimated Tax

Take credit for all your estimated tax payments for 2001 on line 60 of Form 1040 or line 38 of Form 1040A. Include any overpayment from 2000 that you had credited to your 2001 estimated tax. You must use Form 1040 or Form 1040A if you paid estimated tax. You cannot use Form 1040EZ.

Name changed. If you changed your name, and you made estimated tax payments using your old name, attach a brief statement to the front of your tax return indicating:

• When you made the payments,
• The amount of each payment,
• Which IRS address you sent the payments to,
• Your name when you made the payments, and
• Your social security number.

The statement should cover payments you made jointly with your spouse as well as any you made separately.

Separate Returns

If you and your spouse made separate estimated tax payments for 2001 and you file separate returns, you can take credit only for your own payments.

If you made joint estimated tax payments, you must decide how to divide the payments between your returns. One of you can claim all of the estimated tax paid and the other none, or you can divide it in any other way you agree on. If you cannot agree, you must divide the payments in proportion to each spouse's individual tax as shown on your separate returns for 2000.

Divorced Taxpayers

If you made joint estimated tax payments for 2001, and you were divorced during the year, either you or your former spouse can claim all of the joint payments, or you each can claim part of them. If you cannot agree on how to divide the payments, you must divide them in proportion to each spouse's individual tax as shown on your separate returns for 2001.

If you claim any of the joint payments on your tax return, enter your former spouse's social security number (SSN) in the space provided on the front of Form 1040 or Form 1040A. If you divorced and remarried in 2001, enter your present spouse's SSN in that space and write your former spouse's SSN, followed by "DIV," to the left of line 60, Form 1040, or line 38, Form 1040A.

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