I just received my tax package in the mail. Why are there so many forms and schedules in it?

We print several packages that include different forms and schedules that may be filed with Form 1040 (PDF). We mail you the package that includes the items you may need based on what you filed last year. We use packages instead of mailing forms and schedules separately as a cost-saving measure for us and a convenience for you.

References:

• Instructions for Form 1040 (General Inst.), U.S. Individual Income Tax Return

Do I have to file all the forms and schedules that are in my tax package?

No. Complete and attach to your return only the forms and schedules you need to report your income, deductions, and credits.

What form do I use to correct my tax return that I have already filed?

The form needed to correct previously filed Forms 1040, 1040A, 1040EZ, as well as individual income tax returns submitted through TeleFile or e-file, is Form 1040X (PDF), Amended U.S. Individual Income Tax Return.

References:

• Form 1040X (PDF), Amended U.S. Individual Income Tax Return
• Tax Topic 308, Amended returns

Where can the forms be found to file an amended return?

Form 1040X (PDF), Amended U.S. Individual Income Tax Return, and instructions may be ordered by calling (800) 829-3676, or visit the Forms & Pubs section of our web site .

References:

• Form 1040X (PDF), Amended U.S. Individual Income Tax Return
• Tax Topic 308, Amended returns

What form do I need to get a copy of a previous year's federal tax return that I filed?

At the present time, it is not possible to request a copy of your return via the Internet. If you need an exact copy of a previously filed and processed Federal return, you must file Form 4506 (PDF), Request for Copy or Transcript of Tax Form (Form 4506 changes Jan. 1, 2004 to Request for Copy of Tax Return). In cases where an exact copy of the return is not needed, tax return and tax account transcripts may be ordered, to be sent to you at your address of record, by calling (800) 829-1040 or completing and mailing Form 4506 (Effective Jan. 1, 2004, use Form 4506-T, Request for Transcript of Tax Return.) There is a $23 fee (increased to $39 January 1, 2004) for copies of your previously filed tax forms and all attachments (including Form(s) W-2) for each tax period requested. You should allow 60 calendar days for a response. There is no charge for tax return transcripts or Forms W-2 information.

References:

• Form 4506 (PDF), Request for Copy or Transcript of Tax Form Form 4506 (PDF), Rev. 1-1-2004, Request for Copy of Tax Form
• Form 4506 (PDF)-T, Rev1-1-2004, Request for Copy or Transcript of Tax Form

Can I get copies of my prior year Forms W-2 from the IRS?

The quickest way to obtain a copy of a prior year Form W-2 (PDF) is through your employer. If that is not possible, you can order and pay for copies of your entire return (attachments include Form W-2) from IRS, or order W-2 information at no charge from IRS. IRS can provide W-2 information for the current and past 9 years. Complete and mail Form 4506 (PDF), Request for Copy or Transcript of Tax For (Effective Jan. 1, 2004, use Form 4506 (Rev. 1-1-2004, Request for Copy of Tax Return, for a copy of a return and Form 4506-T Rev. 1-1-2004, Request for Transcript or Tax Return, for W-2 information. You should allow 60 calendar days for a response.

References:

• Form 4506 (PDF), Request for Copy or Transcript of Tax Form
• Form 4506 (PDF), Rev. 1-1-2004 Request for Copy of Tax Form
• Form 4506 (PDF)-T Rev. 1-1-2004 Request for Transcript of Tax Form

What form do I fill out to request an extension to file my individual income tax return?

The form to file for an extension of time to time to file your Forms 1040, 1040A, or 1040EZ, is Form 4868 (PDF), Application for Automatic Extension of Time To File U.S. Individual Income Tax Return. You must file Form 4868 by the due date of the return. The automatic extension is a four-month extension.

An extension of time to file is not an extension of time to pay. You must make an accurate estimate of your tax and send any necessary payment with your Form 4868. If you find you cannot pay the full amount due with Form 4868, you can still get the extension. You will owe interest on the unpaid amount.

You will be billed for a late payment penalty (which equals one-half of one percent of the unpaid tax for each month from the original due date of payment), unless at least 90 percent of the actual tax liability was paid prior to the original due date of the return through withholding on wages, estimated tax payments, or any payment accompanying the Form 4868. However, you will not have to pay the penalty if you can show reasonable cause for the failure to pay.

If you qualify for the automatic four month extension and you later find that you are not able to file within the four month extension period, you may be able to get 2 more months to file, for a total of 6 months. To apply for an additional extension either write a letter to the IRS or file Form 2688 (PDF), Application for Additional Extension of Time To File U.S. Individual Income Tax Return. You should ask for the extension early so that, if it is not approved, you still will be able to file by the end of the first extension time limit. Refer to Publication 17, Your Federal Income Tax, for additional information on filing extensions for your individual tax returns.

References:

• Publication 17, Your Federal Income Tax
• Form 4868 (PDF), Application for Automatic Extension of Time To File U.S. Individual Income Tax Return
• Form 2688 (PDF), Application for Additional Extension of Time To File U.S. Individual Income Tax Return

How can I get forms and publications?

You can download them electronically at Forms & Pubs or call 800-TAX-FORM (800-829-3676) 24 hours a day, 7 days a week. You can order by mail using the order blank in the tax package you receive in the mail. Certain forms and publications are available by fax at (703) 368-9694 or pick them up at most local IRS offices, participating libraries, or post offices.

How do I obtain forms (including prior year) and publications not available on your site?

By phone: Call (800) 829-3676 (available 24 hours a day, 7 days a week).

Are copies of tax forms available at local libraries?

If you need tax forms or would like instructions for completing your federal income tax return, your local library may have just what you need. For further information, refer to Tax Topic 105, Public Libraries - Tax Information Tapes and Reproducible Tax Forms.

References:

• Tax Topic 105, Public Libraries - Tax Information Tapes and Reproducible Tax Forms

Is there an Offer and Compromise form available? How can I get one?

The Offer and Compromise form you must complete is Form 656 (PDF), Offer in Compromise.

You can get this form by calling (800) 829-3676 or you can download it at Forms & Pubs through our internet site.

References:

• Publication 594 (PDF), The IRS Collection Process
• Publication 594SP (PDF), Comprendiendo el Proceso del Cobro
• Form 656 (PDF), Offer in Compromise
• Tax Topic 204, Offers in compromise

Are the forms that can be downloaded from this web site approved for use?

Yes, all IRS forms are available for download at Forms & Pubs on our website. All are approved for use.

References:

• Forms & Pubs

Can I use computer-generated tax forms instead of the IRS forms?

IRS provides for the approval and acceptance of computer-prepared and computer-generated tax forms that are filed by individual taxpayers and tax practitioners, in place of many of the official IRS printed forms. For additional information, refer to Tax Topic 253, Substitute Tax Forms.

References:

• Tax Topic 253, Substitute Tax Forms
• Publication 1167 (PDF) , Substitute Tax Form and Schedules

Where can I find previous years' tax forms?

You can download the tax years 1992 through the current year on this web site at Forms & Pubs. You can also order tax forms by calling (800) 829-3676.

References:

• Forms & Pubs

After you download a tax form, how do you open the file to read it?

Refer to our Frequently Asked Downloading and Printing Questions.

To view/print a PDF file from the Web, download the file to your hard drive or diskette, launch the Acrobat Reader (an icon will be created during the setup process) and open the file you just saved. If you need help getting around the IRS web site or assistance retrieving files and forms, we can help you. Call (800) 876-1715 or if outside the US and Canada dial (309) 229-7111 or send a message to the IRS Web Site Help Desk e-mail address at [email protected]. Although we can be pretty busy at times we will try to help you.

References:

• Frequently Asked Downloading and Printing Questions
• IRS Web Site Help Desk e-mail at [email protected].

I am having trouble downloading forms and publications from your web site. What can I do?

First make sure that you have the latest version of Adobe Acrobat Reader software. Adobe Acrobat Reader software is needed to view and print PDF files (the preferred format for viewing or printing IRS forms, instructions, and publications).

Adobe Acrobat Reader is available free-of-charge from hundreds of sites on the Web, including the IRS web site. However, the best way to get the free software is from Adobe's home page. Their site offers two versions of the Reader, versions for most platforms (Macintosh, all Windows versions, etc.), and they even offer the user his/her language preference.

Adobe provides comprehensive instructions for downloading the software.

To view or print a PDF file from the Web, download the file to your hard drive or diskette, launch the Acrobat Reader (an icon will be created during the setup process) and open the file you just saved. The document will appear on your monitor and you can print from there. Some web browsers will launch the reader automatically when you download a PDF file.

Also see Frequently Asked Downloading and Printing Questions on our website.

References:

• Adobe's home page
• Frequently Asked Downloading and Printing Questions

My modem will not download your forms, what can I do?

You can call the IRS at (800) TAX-FORM or (800) 829-3676 and place an order for forms or publications. These numbers are available 24 hours a day, 7 days a week. For more information refer to Tax Topic 155, Forms/Publications - How to Order.

If you have a fax modem and fax software, refer to Fax On Demand on this site for information about getting the forms you need by fax.

For information on how to order forms and publications, refer to Tax Topic 155. The information below may also be helpful:

Internet: Forms & Pubs

FTP: www.irs.gov/pub/irs-pdf

The IRS web site help desk at (800- 876-1715) (or if outside the US and Canada dial (309) 229-7111) or the IRS Web Site Help Desk e-mail address at help desk @speedymail.com offer technical assistance for transmission problems (not tax help).

Federal Tax Forms CD-ROM contains hundreds of tax forms, instructions and TIPS (Taxpayer Information Publications) for current and prior years back to the 1997 tax year. It runs on Windows 95/98/4.0 and Macintosh 7.0 or later platforms. You may purchase the CD-ROM from the National Technical Information Service (NTIS) at Order 2003 Tax Products CD-ROM.

References:

• Tax Topic 155, Forms/Publications - How to Order
• Fax On Demand
• 2002 Tax Products CD-ROM

I would like to know if I could get Publication 78 online?

The entire contents of this publication are now listed on IRS' web site. The listing is accessible through the Tax Information for You and Tax Information for Business sections, or you may go directly to the electronic version of Publication 78, Cumulative List of Organizations.

References:

• Publication 78, Cumulative List of Organizations
• Tax Information for You
• Tax Information for Business

I am looking for a Form I-9. Is it available online?

No. Form I-9 is available from the Bureau of Citizenship and Immigration Services, or call (800) 870-3676.

References:

• Bureau of Citizenship and Immigration Services

I need a list of all the IRS forms, instructions, and publications.

Please refer to Publication 910 (PDF), IRS Guide to Free Tax Services , for a listing of forms and publications available. They are also available at Forms & Pubs.

References:

• Publication 910 (PDF), IRS Guide to Free Tax Services
• Tax Topic 155, Forms and publications - how to order

Is there a form for receiving the no-fault spouse's portion on a joint return when one spouse owes child support?

Yes, Form 8379 (PDF), Injured Spouse Claim and Allocation, is the form used to request your portion of a joint refund.

References:

• Form 8379 (PDF), Injured Spouse Claim and Allocation
• Publication 17, Your Income Federal Tax Return

We had too much social security tax taken out this year. What form do we need to fill out to request some of these monies back?

Credit for excess social security withheld is claimed on page 2 of Form 1040, U.S. Individual Income Tax Return. Refer to Credit for Excess Social Security Tax or Railroad Retirement Tax Withheld in Chapter 38 of Publication 17, Your Federal Income Tax.

References:

• Publication 17, Your Federal Income Tax
• Publication 213 (PDF), Check Your Withholding

What is the tax form number for the custodial parent to sign that allows the noncustodial parent to use the child as a dependent?

The custodial parent should use Form 8332 (PDF), Release of Claim to Exemption for Child of Divorced or Separated Parents, or a substantially similar statement, to release the exemption to the noncustodial parent. The noncustodial parent must attach the form or statement to his or her tax return. Please be aware that if the custodial parent releases the exemption, for a child the custodial parent may not claim a child tax credit for that child.

References:

• Publication 504, Divorced or Separated Individuals
• Form 8332 (PDF), Release of Claim to Exemption for Child of Divorced or Separated Parents
• Tax Topic 354, Dependents

I received a Form 1099-MISC with an amount in box 7, (nonemployee compensation). What forms and schedules should be used to report income earned as an independent contractor?

Independent contractors report their income on Form 1040, Schedule C (PDF), Profit or Loss from Business (Sole Proprietorship), or you may qualify to use Form 1040, Schedule C-EZ (PDF), Net Profit from Business (Sole Proprietorship). You should also be aware of Form 1040, Schedule SE (PDF), Self-Employment Tax, which must be filed if net earnings from self-employment are $400 or more. This form is used to figure your social security and Medicare tax which is based on your net self-employment income. You may also need to file Form 2210, Underpayment of Estimated Tax by Individuals, Estates & Trusts, if you do not make estimated tax payments.

References:

• Form 1040, Schedule C (PDF), Profit or Loss from Business (Sole Proprietorship)
• Form 1040, Schedule C-EZ (PDF), Net Profit from Business
• Instructions for Form 1040, Schedule C
• Form 1040, Schedule SE (PDF), Self-Employment Tax
• Instructions for Form 1040, Schedule SE
• Publication 533, Self-employment Tax
• Publication 334, Tax Guide for Small Business
• Tax information for Business
• Form 2210 (PDF) Underpayment of Estimated Tax

What, if any, quarterly forms must I file to report income as an independent contractor?

There are no quarterly income reporting requirements for Federal income tax purposes. However, because you will have no withholding taken from your income, you may need to make quarterly estimated tax payments. You use Form 1040ES (PDF), Estimated Tax for Individuals.

You need to be aware that there may be state and local requirements for estimated tax payments. You can start looking for information at How to Contact Us. You may want to go to your state's individual Web site for additional information. To access the state you need go to our Alphabetical State Index.

References:

• Form 1040ES (PDF), Estimated Tax for Individuals
• Publication 505, Tax Withholding and Estimated Tax
• Tax Topic 355, Estimated Tax
• Publication 334, Tax Guide for Small Business
• Alphabetical State Index
• Tax Information for Business

I am looking for the form you would use to find out how many quarters you've put in, and what your Social Security amounts would be and the varying ages of retirement, but I don't know the name. Can you help?

You need to check the Social Security Administration web site, at www.ssa.gov . Or, you can contact the Social Security Administration at 1-800-772-1213. They are currently providing information of this nature in an online format. Their web site may also answer your other questions concerning social security.

References:

• Social Security Administration

How can I get a Form 8863?

You can download this form and the instructions from the Forms & Pubs section of our web site. You may also call 1-800-829-3676.

References:

• Publication 970, Tax Benefits for Higher Education
• Tax Topic 605, Education credits
• Form 8863 (PDF), Education Credits (Hope and Lifetime Learning Credits)

What form will I use to make estimated payments?

Use Form 1040ES (PDF), Estimated Tax for Individuals, to estimate your tax liability. Four payment vouchers are included in the 1040ES package that are used to send your payment to the Internal Revenue Service

References:

• Form 1040ES (PDF), Estimated Tax for Individuals

I sold my principal residence this year. What form do I need to file?

If you meet the ownership and use tests, you will generally only need to report the sale of your home if your gain is more than $250,000 ($500,000 if married filing a joint return). This means that during the 5-year period ending on the date of the sale, you must have:

Owned the home for at least 2 years (the ownership test), and

Lived in the home as your main home for at least 2 years (the use test).

If you owned and lived in the property as your main home for less than 2 years, you may still be able to claim an exclusion in some cases. The maximum amount you can exclude will be reduced. If you are required or choose to report a gain, it is reported on Form 1040, Schedule D (PDF), Capital Gains and Losses .

If you were on qualified extended duty in th U.S. Armed Services or the Foreign Service you may suspend the five-year test period for up to 10 years. You are on qualified extended duty when:

At a duty station that is at least 50 miles from the residence sold, or

When residing under orders in government housing, for more than 90 days or for an indefinite period.

This change applies to home sales after May 6, 1997. You may use this provision for only one property at a time and one sale every two years.

For additional information on selling your home, refer to Publication 523, Selling Your Home .

References:

• Publication 523, Selling Your Home
• Tax Topic 701, Sale of your home - after May 6, 1997
• Tax Topic 703, Basis of assets

Is there any publication that explains the proper way to file a Schedule C as a day trader?

There is no publication specific to DayTraders. But see the Instructions for Form 1040, Schedule D . The section "Traders in Securities" has information for DayTraders.

Internal Revenue Code section 475(f) and Revenue Procedure 99-17 apply only to traders who elect to use mark-to-market method of Accounting.

References:

• Publication 550, Investment Income and Expenses
• Publication 535, Business Expenses
• Form 3115 (PDF), Application for Change in Accounting Method
• Instructions for Form 1040, Schedule D
• Internal Revenue Code section 475(f)
• Revenue Procedure 99-17

I am a stock day trader. I understand I have the option of electing the mark-to-market method of accounting which would preclude application of the wash sale rule. What forms and publications do I need?

If your trading activity is a business, your trading expenses would be reported on Form 1040, Schedule C (PDF), Profit or Loss from Business (Sole Proprietorship) instead of Form 1040, Schedule A (PDF), Itemized Deductions . Your gains or losses, however, would be reported on Form 1040, Schedule D (PDF), Capital Gains and Losses , unless you file an election to change your method of accounting to the mark-to-market method of accounting.

See Publication 550, Investment Income and Expenses (p. 68) for guidance on how to make the mark-to-market election. You need Form 3115 (PDF), Application for Change in Accounting Method. The mark-to-market method of accounting cannot be revoked without the consent of the Secretary.

If you qualify and elect to change to the mark-to-market method of accounting, you would report your gains or losses on Part II of Form 4797 (PDF), Sales of Business Property .

References:

• Publication 550, Investment Income and Expenses
• Publication 535, Business Expenses
• Form 3115 (PDF), Application for Change in Accounting Method
• Form 4797 (PDF), Sales of Business Property
• Procedure 99-17
• Revenue Procedure 99-49

What form(s) do we need to fill out to report the sale of rental property?

The gain or loss on the sale of rental property is reported on Form 4797 (PDF), Sale of Business Property. Form 1040, Schedule D (PDF), Capital Gains and Losses, is often used in conjunction with Form 4797. For further information, refer to Publication 544, Sale on Other Disposition of Assets,Publication 550, Investment Income and Expense, the Instructions to Form 4797 (PDF), Sale of Business Property, and the Instructions to Form 1040, Schedule D, Capital Gain and Losses.

References:

• Form 4797 (PDF), Sale of Business Property
• Instructions for Form 4797
• Publication 544, Sales and Other Dispositions of Assets
• Publication 550,Investment Income and Expense
• Form 1040 Schedule D (PDF), Capital Gains and Losses

How do I file the gain on an installment sale of business property in each year? What form do I use?

Use Form 6252 (PDF), Installment Sale Income, to figure your installment sale income each year. This form does not account for taxable interest income from the sale that needs to be reported each year by the seller, usually on Form 1040, Schedule B (PDF), Interest and Ordinary Dividends.

You may also need Form 1040, Schedule D (PDF), Capital Gains and Losses, and Form 4797 (PDF), Sales of Business Property. For additional information including forms and instructions, refer to Publication 537, Installment Sales

References:

• Publication 537, Installment Sales
• Form 1040, Schedule D (PDF), Capital Gains and Losses
• Form 4797 (PDF), Sales of Business Property
• Form 6252 (PDF), Installment Sale Income
• Form 1040, Schedule B (PDF), Interest and Ordinary Dividends

What forms do we file to report a loss on the sale of a rental property?

The loss on the sale of rental property is reported on Form 4797 (PDF), (Sale of Business Property) as ordinary loss.

References:

• Form 4797 (PDF), Sale of Business Property
• Publication 544, Sales and Other Dispositions of Assets

As a Domestic LLC (limited liability company), what forms do I use to file a return?

The form you use will depend on what kind of entity your business is for Federal tax purposes. Following are some general guidelines and the forms which go with each entity:

If your business has only one owner, it will automatically be considered to be a sole proprietorship (referred to as an entity to be disregarded as separate from its owner) unless an election is made to be treated as a corporation. A sole proprietorship files Form 1040 (PDF), U.S. Individual Income Tax Return and will include Form 1040, Schedule C (PDF), Profit or Loss from Business, or Form 1040, Schedule C-EZ (PDF) and Form 1040, Schedule SE (PDF) , if net income $400.00. If an election is made to be treated as a corporation, Form 1120 (PDF), U.S. Corporation Income Tax Return, is filed.

If your business has two or more owners, it will automatically be considered to be a partnership unless an election is made to be treated as a corporation. A partnership files Form 1065 (PDF), U.S. Partnership Return of Income. If an election is made to be treated as a corporation, Form 1120 (PDF), U.S. Corporation Income Tax Return, is filed.

The election referred to is made by filing Form 8832 (PDF), Entity Classification Election.

References:

• Publication 334, Tax Guide for Small Business
• Tax Topic 103, Small Business Tax Education Program
• Publication 542, Corporations
• Publication 541, Partnerships
• Form 8832 (PDF), Entity Classification Election

What forms and schedules should be used to report income earned as an independent contractor?

Independent contractor report their income on Form 1040, Schedule C (PDF), Profit or Loss from Business, or they may qualify to use Form 1040, Schedule C-EZ (PDF), Net Profit from Business. Independent contractors should also be aware of Form 1040, Schedule SE (PDF), Self-Employment Tax. This form is used to figure social security and Medicare tax which is based on self-employment income. Also, see Form 1040ES (PDF) Estimated Tax For Individuals, as you may need to make quarterly estimated tax payments.

References:

• Form 1040, Schedule C (PDF), Profit or Loss from Business
• Form 1040, Schedule C-EZ (PDF), Net Profit from Business
• Instructions for Form 1040, Schedule C
• Form 1040, Schedule SE (PDF), Self-Employment Tax
• Form 1040ES (PDF), Estimated Tax for Individuals
• Instructions for Form 1040, Schedule SE
• Publication 533, Self-Employment Tax
• Publication 334, Tax Guide for Small Business
• Tax Topic 554, Self-Employment Tax
• Publication 505, Tax Withholding and Estimated Tax
• Tax information for Business

What, if any, quarterly forms must I file to report income as an independent contractor?

There are no quarterly income reporting requirements for Federal income tax purposes. However, because you will have no Federal Income Tax withheld from your income, you may need to make quarterly estimated tax payments. You use Form 1040ES (PDF), Estimated Tax for Individuals, for this purpose.

You may be subject to a penalty for underpaying your estimated tax installments. For more information refer to Publication 505, Tax Withholding and Estimated Tax. You need to be aware that there may also be state and local quarterly reporting requirements. You can start looking for information at How to Contact Us. You may want to go to your state's individual web site for additional information. To access the state you need to direct your question to, please go to our Alphabetical State Index.

References:

• Form 1040ES (PDF), Estimated Tax for Individuals
• Form 2210, (PDF) Underpayment of Estimated Tax by Individuals, Estates & Trusts
• Publication 505, Tax Withholding and Estimated Tax
• Publication 533, Self-Employment Tax
• Tax Topic 355, Estimated Tax
• Publication 334, Tax Guide for Small Business
• Tax Information for Business
• Alphabetical State Index

What publications are available that would explain the taxation policy for Flexible Spending Arrangements (FSAs)?

Information on Flexible Spending Account and Cafeteria Plans can be found in the following sources listed below:

References:

• Publication 15-B (PDF) , Employer's Tax 'Guide to Fringe Benefits
• Cafeteria Plan Explanations, Code and Regulations
• Cafeteria Plan Introduction Text
• Cafeteria is No Ruling Section
• Cafeteria Plan/Qualified Retirement Plan Hybrid Arrangements
• Change in Status Elections
• Health Flexible Spending Arrangements

If you do not have any employees for a particular quarter, do you have to file an Employer's Quarterly Federal Tax Return Form 941?

Seasonal employers are not required to file for quarters when they regularly have no tax liability because they have paid no wages. To alert the IRS that you will not have to file a return for one or more quarters during the year, check the seasonal employer box above line 1 on Form 941. The IRS will mail two Forms 941 to you once a year after March 1. The preprinted name and address information will not include the date the quarter ended. You must enter the date the quarter ended when you file the return. The IRS generally will not inquire about unfiled returns if at least one return showing tax due is filed each year. However, you must check the seasonal employer box on each quarterly return you file. Otherwise, the IRS will expect a return to be filed for each quarter.

For any employer, who no longer has employees, a final return should be filed for the last quarter during which you had employees.

References:

• Instructions for Form 941, Employer's Quarterly Federal Tax Return

All of the Forms 941 that I can find ask for the number of employees on record as of March 12th. Is there a similar form for the second quarter?

The Form 941 is the same for all 4 quarters. Only on the January-March calendar quarter Form 941 should you enter the number of employees on your payroll during the pay period that includes March 12. You do not need to answer this question on the Forms 941 for the other 3 quarters.

References:

• Instructions for Form 941, Employer's Quarterly Federal Tax Return

What forms do you use when you have a small business?

The annual income tax forms that you would use to report you business activity to the IRS would depend on the type of entity you operate your business under.

Sole Proprietorships use Form 1040, Schedule C (PDF), Profit and Loss from Business (Sole Proprietorship) or Form 1040, Schedule C-EZ (PDF), Net Profit from Business and Form 1040, Schedule SE (PDF), Self-employment Tax.

Partnerships use Form 1065 (PDF), U.S. Partnership Return of Income and Schedule K-1.

Corporations use Form 1120 (PDF), U.S. Corporation Income Tax Return.

S Corporations use Form 1120S (PDF), U.S. Income Tax Return for an S Corporation.

Limited Liability Companies use one of the choices above according to their structure.

If you hired employees to work in your business, if you are liable for excise tax, or heavy highway vehicle use tax, other forms and publications would come into play.

References:

• Publication 334, Tax Guide for Small Business
• Publication 541, Partnerships
• Publication 542, Corporations
• Form 1120S (PDF), U.S. Income Tax Return for an S Corporation
• Form 1065 (PDF), U.S Partnership Return of Income
• Form 1120 (PDF), U.S. Corporation Income Tax Return
• Form 1040, Schedule C (PDF)
• Form 1040, Schedule C-EZ (PDF)
• Form 1040 Schedule SE (PDF)

What deductions can I take on my partnership or S Corporation return

In general, ordinary and necessary business expenses are deductible on business return. However, there are some items that partnership and S Corporation do not deduct at the business entity level but rather at the partner or shareholder level. These are referred to as separately stated items. For a more complete explanation of business in general, see Publication 535 , Business Expenses Publication 541, Partnerships, and Instructions for Form 1120S.

References:

• Publication 535, Business Expenses
• Publication 541, Partnership
• Instructions for Form 1120S
• Instructions for Form 1065

What do I need to do to become a Corporation?

Corporation are formed at the state level first. For additional information on requirements at the federal level, please see Publication 542, on Corporation .

References:

• Publication 542, Corporation

Where is a loss reported on my return and how much can I deduct?

The place where your loss is reported depends on how much is deductible, the type of loss, and the type of return you are filing. If your business deductions are more than your business income for the year, you may have a Net Operating Loss (NOL). You can use an NOL by deducting it from your income in another year or years. Partnerships and S Corporations generally cannot use an NOL. But partners or shareholders can use their separate shares of the partnership's of S Corporation's business deductions to their individual NOLs. For additional help, see Publication 541, Partnership, Publication 542, Corporation, Publication 925, Passive Activities and At-Risk Rules, and Publication 536, Net Operating Losses (NOLs) for individuals, Estates, and Trusts.

If you have a Capital Loss, it is generally from the sale or loss of investment property, a business, or a capital asset used in a business. Publication 544, on Sales and Other Disposition of Assets, will provide additional information on this subject.

Special Situations

S Corporations

In general, if an S corporation purchases a C Corporation at the end of the year and the C Corporation has a loss, the S Corporation does not get to claim the C Corporation loss. A C Corporation is a taxable entity in itself and gains and losses do not flow through to the shareholders.

S Corporation shareholder who hold stock at any time during the year may claim their proportionate share of corporate losses on their individual tax returns subject to certain limits. For more information about the limitations, see the instruction for Instructions for Form 1120S, Schedule K-1.

Partnerships

In general, a partner loss is allocated base on his/her percentage of ownership of the year. This percentage is referred to as the partner's distributive share. The partners' distributive share of items is reported to the partner on Schedule K-1 (Form 1065). A partner's distributive share of partnership loss is allowed only to the extent of the adjusted basis of the partner's partnership interest. A loss that is more than the partner's adjusted basis is not deductible. For additional deductibility of partnership losses, see Publication 541, Partnership, and Publication 925, Passive Activities and At-Risk Rules

References:

• Publication 541, Partnership
• Publication 542, Corporation
• Publication 925, Passive Activities and At-risk Rules
• Publication 536, Net Operating Losses (NOLs) for individuals, Estates, and Trusts
• Publication 544, Sales and Other Dispositions of Assets

I live in a foreign country. Where can I find local tax assistance and forms?

The IRS has a full-time permanent staff in 6 U.S. Embassies. These offices have tax forms and publications, can help you with account problems, and answer your questions about notices and bills. For more information about these offices, please refer to www.irs.gov under "Contact My Local Office."

In addition, most U.S. Embassies stock the more commonly used tax forms and publications, and sponsor speaking tours by IRS employees during filing season.

Where can I get a TeleFile form?

If you file a paper tax return for the current year and qualify to TeleFile, the IRS should send you a TeleFile package in the mail by January 20th of the following year, which will include your PIN number. If you qualify and do not receive the package, call (800) 829-1040 and request one. If you do not qualify, you can still receive all of the benefits that IRS e-file has to offer by using a personal computer or filing through an Authorized IRS e-file Provider. To learn more, refer to our Electronic Services information. For general information about TeleFile or e-file, refer to Tax Topic 255, TeleFile, or Tax Topic 252, Electronic Filing.

References:

• Tax Topic 255, TeleFile
• Tax Topic 252, Electronic Filing
• Electronic Services

I have not received a TeleFile tax package. Is there a way I can order this form?

If you have met the criteria for using Telefile, i.e., filed TeleFile or a paper 1040 EZ the current year and have not changed your address or filing requirements, you should receive a package. If you do not receive the TeleFile tax package or if you lost or misplaced it, you can call the IRS at (800) 829-1040 and request another package be mailed to you. Also, consider IRS e-file using a personal computer or filing through an Authorized IRS e-file Provider. To learn more, refer to our Electronic Services information. For general information about TeleFile or e-file, refer to Tax Topic 255, TeleFile, or Tax Topic 252, Electronic Filing.

References:

• Tax Topic 255, TeleFile
• Tax Topic 252, Electronic Filing
• Electronic Services