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Www.irs Tax Form 1040ez For 2012

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Www.irs Tax Form 1040ez For 2012

Www. Www.irs tax form 1040ez for 2012 irs tax form 1040ez for 2012 Publication 584 - Additional Material Table of Contents This image is too large to be displayed in the current screen. Www.irs tax form 1040ez for 2012 Please click the link to view the image. Www.irs tax form 1040ez for 2012 Entrance Hall This image is too large to be displayed in the current screen. Www.irs tax form 1040ez for 2012 Please click the link to view the image. Www.irs tax form 1040ez for 2012 Living Room This image is too large to be displayed in the current screen. Www.irs tax form 1040ez for 2012 Please click the link to view the image. Www.irs tax form 1040ez for 2012 Dining Room This image is too large to be displayed in the current screen. Www.irs tax form 1040ez for 2012 Please click the link to view the image. Www.irs tax form 1040ez for 2012 Kitchen This image is too large to be displayed in the current screen. Www.irs tax form 1040ez for 2012 Please click the link to view the image. Www.irs tax form 1040ez for 2012 Den This image is too large to be displayed in the current screen. Www.irs tax form 1040ez for 2012 Please click the link to view the image. Www.irs tax form 1040ez for 2012 Bedrooms This image is too large to be displayed in the current screen. Www.irs tax form 1040ez for 2012 Please click the link to view the image. Www.irs tax form 1040ez for 2012 Bathrooms This image is too large to be displayed in the current screen. Www.irs tax form 1040ez for 2012 Please click the link to view the image. Www.irs tax form 1040ez for 2012 Recreation Room This image is too large to be displayed in the current screen. Www.irs tax form 1040ez for 2012 Please click the link to view the image. Www.irs tax form 1040ez for 2012 Laundry and Basement This image is too large to be displayed in the current screen. Www.irs tax form 1040ez for 2012 Please click the link to view the image. Www.irs tax form 1040ez for 2012 Garage This image is too large to be displayed in the current screen. Www.irs tax form 1040ez for 2012 Please click the link to view the image. Www.irs tax form 1040ez for 2012 Sporting Equipment This image is too large to be displayed in the current screen. Www.irs tax form 1040ez for 2012 Please click the link to view the image. Www.irs tax form 1040ez for 2012 Men's Clothing This image is too large to be displayed in the current screen. Www.irs tax form 1040ez for 2012 Please click the link to view the image. Www.irs tax form 1040ez for 2012 Women's Clothing This image is too large to be displayed in the current screen. Www.irs tax form 1040ez for 2012 Please click the link to view the image. Www.irs tax form 1040ez for 2012 Children's Clothing This image is too large to be displayed in the current screen. Www.irs tax form 1040ez for 2012 Please click the link to view the image. Www.irs tax form 1040ez for 2012 Jewelry This image is too large to be displayed in the current screen. Www.irs tax form 1040ez for 2012 Please click the link to view the image. Www.irs tax form 1040ez for 2012 Electrical Appliances This image is too large to be displayed in the current screen. Www.irs tax form 1040ez for 2012 Please click the link to view the image. Www.irs tax form 1040ez for 2012 Linens This image is too large to be displayed in the current screen. Www.irs tax form 1040ez for 2012 Please click the link to view the image. Www.irs tax form 1040ez for 2012 Miscellaneous This image is too large to be displayed in the current screen. Www.irs tax form 1040ez for 2012 Please click the link to view the image. Www.irs tax form 1040ez for 2012 Motor Vehicles Schedule 20. Www.irs tax form 1040ez for 2012 Home (Excluding Contents) Note. Www.irs tax form 1040ez for 2012 If you used the entire property as your home, fill out only column (a). Www.irs tax form 1040ez for 2012 If you used part of the property as your home and part of it for business or to produce rental income, you must allocate the entries on lines 2-9 between the personal part (column (a)) and the business/rental part (column (b)). Www.irs tax form 1040ez for 2012 1. Www.irs tax form 1040ez for 2012 Description of property (Show location and date acquired. Www.irs tax form 1040ez for 2012 )     (a)  Personal Part (b)  Business/Rental Part 2. Www.irs tax form 1040ez for 2012 Cost or other (adjusted) basis of property (from Worksheet A)     3. Www.irs tax form 1040ez for 2012 Insurance or other reimbursement Note. Www.irs tax form 1040ez for 2012 If line 2 is more than line 3, skip line 4. Www.irs tax form 1040ez for 2012 If line 3 is more than line 2, you exclude gain, and the gain is more than you can exclude, see the instructions for line 3 in the Instructions for Form 4684 for the amount to enter. Www.irs tax form 1040ez for 2012     4. Www.irs tax form 1040ez for 2012 Gain from casualty. Www.irs tax form 1040ez for 2012 If line 3 is more than line 2, enter the difference here and skip lines 5 through 9. Www.irs tax form 1040ez for 2012 But see Next below line 9. Www.irs tax form 1040ez for 2012     5. Www.irs tax form 1040ez for 2012 Fair market value before casualty     6. Www.irs tax form 1040ez for 2012 Fair market value after casualty     7. Www.irs tax form 1040ez for 2012 Decrease in fair market value. Www.irs tax form 1040ez for 2012 Subtract line 6 from line 5. Www.irs tax form 1040ez for 2012     8. Www.irs tax form 1040ez for 2012 Enter the smaller of line 2 or line 7 Note for business/rental part. Www.irs tax form 1040ez for 2012 If the property was totally destroyed by casualty, enter on line 8, column (b) the amount from line 2, column (b). Www.irs tax form 1040ez for 2012     9. Www.irs tax form 1040ez for 2012 Subtract line 3 from line 8. Www.irs tax form 1040ez for 2012 If zero or less, enter -0-. Www.irs tax form 1040ez for 2012     Next: Transfer the entries from line 1 and lines 2-9, column (a), above to the corresponding lines on Form 4684, Section A. Www.irs tax form 1040ez for 2012 Transfer the entries from line 1 and lines 2-9, column (b), to the corresponding lines on Form 4684, Section B. Www.irs tax form 1040ez for 2012 Worksheet A. Www.irs tax form 1040ez for 2012 Cost or Other (Adjusted) Basis Caution. Www.irs tax form 1040ez for 2012 See the Worksheet A Instructions before you use this worksheet. Www.irs tax form 1040ez for 2012         (a) Personal Part (b) Business/Rental Part 1. Www.irs tax form 1040ez for 2012   Enter the purchase price of the home damaged or destroyed. Www.irs tax form 1040ez for 2012 (If you filed Form 2119 when you originally acquired that home to postpone gain on the sale of a previous home before May 7, 1997, enter the adjusted basis of the new home from that Form 2119. Www.irs tax form 1040ez for 2012 ) 1. Www.irs tax form 1040ez for 2012     2. Www.irs tax form 1040ez for 2012   Seller paid points for home bought after 1990. Www.irs tax form 1040ez for 2012 Do not include any seller-paid points you already subtracted to arrive at the amount entered on line 1 2. Www.irs tax form 1040ez for 2012     3. Www.irs tax form 1040ez for 2012   Subtract line 2 from line 1 3. Www.irs tax form 1040ez for 2012     4. Www.irs tax form 1040ez for 2012   Settlement fees or closing costs. Www.irs tax form 1040ez for 2012 (See Settlement costs in Publication 551. Www.irs tax form 1040ez for 2012 ) If line 1 includes the adjusted basis of the new home from Form 2119, skip lines 4a-4g and 5; go to line 6. Www.irs tax form 1040ez for 2012         a. Www.irs tax form 1040ez for 2012 Abstract and recording fees 4a. Www.irs tax form 1040ez for 2012       b. Www.irs tax form 1040ez for 2012 Legal fees (including fees for title search and preparing documents) 4b. Www.irs tax form 1040ez for 2012       c. Www.irs tax form 1040ez for 2012 Survey fees 4c. Www.irs tax form 1040ez for 2012       d. Www.irs tax form 1040ez for 2012 Title insurance 4d. Www.irs tax form 1040ez for 2012       e. Www.irs tax form 1040ez for 2012 Transfer or stamp taxes 4e. Www.irs tax form 1040ez for 2012       f. Www.irs tax form 1040ez for 2012 Amounts that the seller owed that you agreed to pay (back taxes or interest, recording or mortgage fees, and sales commissions) 4f. Www.irs tax form 1040ez for 2012       g. Www.irs tax form 1040ez for 2012 Other 4g. Www.irs tax form 1040ez for 2012     5. Www.irs tax form 1040ez for 2012   Add lines 4a through 4g 5. Www.irs tax form 1040ez for 2012     6. Www.irs tax form 1040ez for 2012   Cost of additions and improvements. Www.irs tax form 1040ez for 2012 (See Increases to Basis in Publication 551. Www.irs tax form 1040ez for 2012 ) Do not include any additions and improvements included on line 1 6. Www.irs tax form 1040ez for 2012     7. Www.irs tax form 1040ez for 2012   Special tax assessments paid for local improvements, such as streets and sidewalks 7. Www.irs tax form 1040ez for 2012     8. Www.irs tax form 1040ez for 2012   Other increases to basis 8. Www.irs tax form 1040ez for 2012     9. Www.irs tax form 1040ez for 2012   Add lines 3, 5, 6, 7, and 8 9. Www.irs tax form 1040ez for 2012     10. Www.irs tax form 1040ez for 2012   Depreciation allowed or allowable, related to the business use or rental of the home 10. Www.irs tax form 1040ez for 2012 0   11. Www.irs tax form 1040ez for 2012   Other decreases to basis (See Decreases to Basis in Publication 551. Www.irs tax form 1040ez for 2012 ) 11. Www.irs tax form 1040ez for 2012     12. Www.irs tax form 1040ez for 2012   Add lines 10 and 11 12. Www.irs tax form 1040ez for 2012     13. Www.irs tax form 1040ez for 2012   Cost or other (adjusted) basis of home damaged or destroyed. Www.irs tax form 1040ez for 2012 Subtract line 12 from line 9. Www.irs tax form 1040ez for 2012 Enter here and on Schedule 20, line 2 13. Www.irs tax form 1040ez for 2012     Worksheet A Instructions. Www.irs tax form 1040ez for 2012 If you use Worksheet A to figure the cost or other (adjusted) basis of your home, follow these instructions. Www.irs tax form 1040ez for 2012 DO NOT use this worksheet to determine your basis if you acquired an interest in your home from a decedent who died in 2010 and whose executor filed Form 8939. Www.irs tax form 1040ez for 2012 IF. Www.irs tax form 1040ez for 2012 . Www.irs tax form 1040ez for 2012 . Www.irs tax form 1040ez for 2012   THEN. Www.irs tax form 1040ez for 2012 . Www.irs tax form 1040ez for 2012 . Www.irs tax form 1040ez for 2012 you inherited your home from a decedent who died either before or after 2010 or from a decedent who died in 2010 and whose executor did not file Form 8939. Www.irs tax form 1040ez for 2012 1 skip lines 1–4 of the worksheet. Www.irs tax form 1040ez for 2012 2 find your basis using the rules under Inherited Property in Publication 551. Www.irs tax form 1040ez for 2012 Enter this amount on line 5 of the worksheet. Www.irs tax form 1040ez for 2012 3 fill out lines 6–13 of the worksheet. Www.irs tax form 1040ez for 2012 you received your home as a gift 1 read Property Received as a Gift in Publication 551 and enter on lines 1 and 3 of the worksheet either the donor's adjusted basis or the home's fair market value at the time of the gift, whichever is appropriate. Www.irs tax form 1040ez for 2012 2 if you can add any federal gift tax to your basis, enter that amount on line 5 of the worksheet. Www.irs tax form 1040ez for 2012 3 fill out the rest of the worksheet. Www.irs tax form 1040ez for 2012 you received your home as a trade for other property 1 enter on line 1 of the worksheet the fair market value of the other property at the time of the trade. Www.irs tax form 1040ez for 2012 (But if you received your home as a trade for your previous home before May 7, 1997, and had a gain on the trade that you postponed using Form 2119, enter on line 1 of the worksheet the adjusted basis of the new home from that Form 2119. Www.irs tax form 1040ez for 2012 ) 2 fill out the rest of the worksheet. Www.irs tax form 1040ez for 2012 you built your home 1 add the purchase price of the land and the cost of building the home. Www.irs tax form 1040ez for 2012 Enter that total on line 1 of the worksheet. Www.irs tax form 1040ez for 2012 (However, if you filed a Form 2119 to postpone gain on the sale of a previous home before May 7, 1997, enter on line 1 of the worksheet the adjusted basis of the new home from that Form 2119. Www.irs tax form 1040ez for 2012 ) 2 fill out the rest of the worksheet. Www.irs tax form 1040ez for 2012 you received your home from your spouse after July 18, 1984 1 skip lines 1–4 of the worksheet. Www.irs tax form 1040ez for 2012 2 enter on line 5 of the worksheet your spouse's cost or other (adjusted) basis in the home just before you received it. Www.irs tax form 1040ez for 2012 3 fill out lines 6–13 of the worksheet, making adjustments to basis only for events after the transfer. Www.irs tax form 1040ez for 2012 you owned a home jointly with your spouse, who transferred his or her interest in the home to you after July 18, 1984     fill out one worksheet, making adjustments to basis for events both before and after the transfer. Www.irs tax form 1040ez for 2012   you received your home from your spouse before July 19, 1984 1 skip lines 1–4 of the worksheet. Www.irs tax form 1040ez for 2012 2 enter on line 5 of the worksheet the home's fair market value at the time you received it. Www.irs tax form 1040ez for 2012 3 fill out lines 6–13 of the worksheet, making adjustments to basis only for events after the transfer. Www.irs tax form 1040ez for 2012 you owned a home jointly with your spouse, and your spouse transferred his or her interest in the home to you before July 19, 1984 1 fill out a worksheet, lines 1–13, making adjustments to basis only for events before the transfer. Www.irs tax form 1040ez for 2012 2 multiply the amount on line 13 of that worksheet by 50% (0. Www.irs tax form 1040ez for 2012 50) to get the adjusted basis of your half-interest at the time of the transfer. Www.irs tax form 1040ez for 2012 3 multiply the fair market value of the home at the time of the transfer by 50% (0. Www.irs tax form 1040ez for 2012 50). Www.irs tax form 1040ez for 2012 Generally, this is the basis of the half-interest that your spouse owned. Www.irs tax form 1040ez for 2012 4 add the amounts from steps 2 and 3 and enter the total on line 5 of a second worksheet. Www.irs tax form 1040ez for 2012 5 complete lines 6–13 of the second worksheet, making adjustments to basis only for events after the transfer. Www.irs tax form 1040ez for 2012 you owned your home jointly with a nonspouse 1 fill out lines 1–13 of the worksheet. Www.irs tax form 1040ez for 2012 2 multiply the amount on line 13 by your percentage of ownership to get the adjusted basis of your part-interest. Www.irs tax form 1040ez for 2012 Worksheet A Instructions. Www.irs tax form 1040ez for 2012 (Continued) IF. Www.irs tax form 1040ez for 2012 . Www.irs tax form 1040ez for 2012 . Www.irs tax form 1040ez for 2012   THEN. Www.irs tax form 1040ez for 2012 . Www.irs tax form 1040ez for 2012 . Www.irs tax form 1040ez for 2012 you owned your home jointly with your spouse who died before 2010 and before the casualty 1 fill out a worksheet, lines 1–13, including adjustments to basis only for events before your spouse's death. Www.irs tax form 1040ez for 2012 2 multiply the amount on line 13 of that worksheet by 50% (0. Www.irs tax form 1040ez for 2012 50) to get the adjusted basis of your half-interest on the date of death. Www.irs tax form 1040ez for 2012 3 figure the basis for the half-interest owned by your spouse. Www.irs tax form 1040ez for 2012 This is one-half of the fair market value on the date of death (or later alternate valuation used for estate or inheritance tax). Www.irs tax form 1040ez for 2012 (The basis in your half will remain one-half of the adjusted basis determined in step 2. Www.irs tax form 1040ez for 2012 ) 4 add the amounts from steps 2 and 3 and enter the total on line 5 of a second worksheet. Www.irs tax form 1040ez for 2012 5 complete lines 6–13 of the second worksheet, making adjustments to basis only for events after your spouse's death. Www.irs tax form 1040ez for 2012 you owned your home jointly with your spouse who died before 2010 and before the casualty, and your permanent legal home is in a community property state 1 skip lines 1–4 of the worksheet. Www.irs tax form 1040ez for 2012 2 enter the amount of your basis on line 5 of the worksheet. Www.irs tax form 1040ez for 2012 Generally, this is the fair market value of the home at the time of death. Www.irs tax form 1040ez for 2012 (But see Community Property in Publication 551 for special rules. Www.irs tax form 1040ez for 2012 ) 3 fill out lines 6–13 of the worksheet, making adjustments to basis only for events after your spouse's death. Www.irs tax form 1040ez for 2012 you owned your home jointly with a nonspouse who died before 2010 and before the casualty 1 fill out lines 1–13 of the worksheet, including adjustments to basis only for events before the co-owner's death. Www.irs tax form 1040ez for 2012 2 multiply the amount on line 13 by your percentage of ownership to get the adjusted basis of your part-interest on the date of death. Www.irs tax form 1040ez for 2012 3 multiply the fair market value on the date of death (or later alternate valuation used for estate or inheritance tax) by the co-owner's percentage of ownership. Www.irs tax form 1040ez for 2012 This is the basis for the co-owner's part-interest. Www.irs tax form 1040ez for 2012 4 add the amounts from steps 2 and 3 and enter the total on line 5 of a second worksheet. Www.irs tax form 1040ez for 2012 5 complete lines 6–13 of the second worksheet, including adjustments to basis only for events after the co-owner's death. Www.irs tax form 1040ez for 2012 your home was ever damaged as a result of a prior casualty 1 on line 8 of the worksheet, enter any amounts you spent to restore the home to its condition before the prior casualty. Www.irs tax form 1040ez for 2012 2 on line 11 enter: any insurance reimbursements you received (or expect to receive) for the prior loss,  and any deductible casualty losses from prior years not covered by insurance. Www.irs tax form 1040ez for 2012 the person who sold you your home paid points on your loan and you bought your home after 1990 but before April 4, 1994. Www.irs tax form 1040ez for 2012   on line 2 enter the seller-paid points only if you deducted them as home mortgage interest in the year paid (unless you used the seller-paid points to reduce the amount on line 1). Www.irs tax form 1040ez for 2012 the person who sold you your home paid points on your loan and you bought your home after April 3, 1994   on line 2 enter the seller-paid points even if you did not deduct them (unless you used the seller-paid points to reduce the amount on line 1). Www.irs tax form 1040ez for 2012 you used part of the property as your home and part of it for business or to produce rental income   you must allocate the entries on Worksheet A between the personal part (column (a)) and the business/rental part (column (b)). Www.irs tax form 1040ez for 2012 none of these items apply   fill out the entire worksheet. Www.irs tax form 1040ez for 2012 Prev  Up  Next   Home   More Online Publications
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The Www.irs Tax Form 1040ez For 2012

Www. Www.irs tax form 1040ez for 2012 irs tax form 1040ez for 2012 Depreciation Table of Contents Introduction Special Depreciation AllowanceQualified Property Election Not To Claim the Allowance Rules for Returns Filed Before June 1, 2002 Passenger Automobiles New York Liberty Zone BenefitsSpecial Liberty Zone Depreciation Allowance Increased Section 179 Deduction Liberty Zone Leasehold Improvement Property If you depreciate business property that you acquired and placed in service after September 10, 2001, new law contains provisions that may affect your depreciation deduction for that property. Www.irs tax form 1040ez for 2012 Publication 946, How To Depreciate Property, contains information on depreciation. Www.irs tax form 1040ez for 2012 However, Publication 946 does not contain the new provisions because it was printed before the law was enacted. Www.irs tax form 1040ez for 2012 The new provisions are in the Supplement to Publication 946, which is reprinted below. Www.irs tax form 1040ez for 2012 Supplement to Publication 946 How To Depreciate Property   Introduction After Publication 946 was printed, the Job Creation and Worker Assistance Act of 2002 was signed into law by the President. Www.irs tax form 1040ez for 2012 The new law made several changes in the tax rules explained in the publication. Www.irs tax form 1040ez for 2012 Some of the changes apply to property placed in service during 2001. Www.irs tax form 1040ez for 2012 This supplemental publication describes those changes and explains what you should do if you are affected by them. Www.irs tax form 1040ez for 2012 The situations and examples in Publication 946 do not reflect any of the changes made by the Job Creation and Worker Assistance Act of 2002. Www.irs tax form 1040ez for 2012 The new law contains the following provisions. Www.irs tax form 1040ez for 2012 30% depreciation deductions (special depreciation allowance and special New York Liberty Zone (Liberty Zone) depreciation allowance) for the year qualified property is placed in service after September 10, 2001. Www.irs tax form 1040ez for 2012 An increased dollar limit on the section 179 deduction for qualified Liberty Zone property purchased after September 10, 2001. Www.irs tax form 1040ez for 2012 A shorter recovery period for qualified Liberty Zone leasehold improvement property placed in service after September 10, 2001. Www.irs tax form 1040ez for 2012 An increase in the maximum depreciation deduction for 2001 for a qualified passenger automobile placed in service after September 10, 2001. Www.irs tax form 1040ez for 2012 If you believe you qualify for an increased deduction under any of these new rules, you must file the revised 2001 Form 4562 (dated March 2002) for 2001 calendar or fiscal years and 2000 fiscal years ending after September 10, 2001. Www.irs tax form 1040ez for 2012 If you have already filed a tax return, this supplemental publication explains how to claim these benefits and how to elect not to claim the special depreciation allowance or special Liberty Zone depreciation allowance. Www.irs tax form 1040ez for 2012 See Table 2 at the end of the supplement for an overview of the rules that apply if you filed your return before June 1, 2002. Www.irs tax form 1040ez for 2012 Special Depreciation Allowance You can take a special depreciation allowance for qualified property you place in service after September 10, 2001. Www.irs tax form 1040ez for 2012 The allowance is an additional deduction of 30% of the property's depreciable basis. Www.irs tax form 1040ez for 2012 To figure the depreciable basis, you must first multiply the property's cost or other basis by the percentage of business/investment use and then reduce that amount by any section 179 deduction and certain other deductions and credits for the property. Www.irs tax form 1040ez for 2012 See What Is the Basis for Depreciation? on page 23 in Publication 946 for more information on figuring depreciable basis. Www.irs tax form 1040ez for 2012 The allowance is deductible for both regular tax and alternative minimum tax (AMT) purposes. Www.irs tax form 1040ez for 2012 There is no AMT adjustment required for any depreciation figured on the remaining basis of the property. Www.irs tax form 1040ez for 2012 In the year you claim the allowance (generally the year you place the property in service), you must reduce the depreciable basis of the property by the allowance before figuring your regular depreciation deduction. Www.irs tax form 1040ez for 2012 Example 1. Www.irs tax form 1040ez for 2012 On November 1, 2001, you bought and placed in service in your business qualified property that cost $100,000. Www.irs tax form 1040ez for 2012 You did not elect to claim a section 179 deduction. Www.irs tax form 1040ez for 2012 You can deduct 30% of the cost ($30,000) as a special depreciation allowance for 2001. Www.irs tax form 1040ez for 2012 You use the remaining $70,000 of cost to figure your regular depreciation deduction for 2001 and later years. Www.irs tax form 1040ez for 2012 Example 2. Www.irs tax form 1040ez for 2012 The facts are the same as in Example 1, except that you choose to deduct $24,000 of the property's cost as a section 179 deduction. Www.irs tax form 1040ez for 2012 You use the remaining $76,000 of cost to figure your special depreciation allowance of $22,800 ($76,000 × 30%). Www.irs tax form 1040ez for 2012 You use the remaining $53,200 of cost to figure your regular depreciation deduction for 2001 and later years. Www.irs tax form 1040ez for 2012 Qualified Property To qualify for the special depreciation allowance, your property must meet the following requirements. Www.irs tax form 1040ez for 2012 It is new property of one of the following types. Www.irs tax form 1040ez for 2012 Property depreciated under the modified accelerated cost recovery system (MACRS) with a recovery period of 20 years or less. Www.irs tax form 1040ez for 2012 See Can You Use MACRS To Depreciate Your Property and Which Recovery Period Applies? on pages 7 and 23, respectively, in Publication 946. Www.irs tax form 1040ez for 2012 Water utility property. Www.irs tax form 1040ez for 2012 See 25-year property on page 22 in Publication 946. Www.irs tax form 1040ez for 2012 Computer software that is not a section 197 intangible as described in Computer software on page 5 in Publication 946. Www.irs tax form 1040ez for 2012 (The cost of some computer software is treated as part of the cost of hardware and is depreciated under MACRS. Www.irs tax form 1040ez for 2012 ) Qualified leasehold improvement property (defined later). Www.irs tax form 1040ez for 2012 It meets the following tests (explained later under Tests To Be Met). Www.irs tax form 1040ez for 2012 Acquisition date test. Www.irs tax form 1040ez for 2012 Placed in service date test. Www.irs tax form 1040ez for 2012 Original use test. Www.irs tax form 1040ez for 2012 It is not excepted property (explained later under Excepted Property). Www.irs tax form 1040ez for 2012 Qualified leasehold improvement property. Www.irs tax form 1040ez for 2012    Generally, this is any improvement to an interior part of a building that is nonresidential real property, provided all of the following requirements are met. Www.irs tax form 1040ez for 2012 The improvement is made under or pursuant to a lease by the lessee (or any sublessee) or the lessor of that part of the building. Www.irs tax form 1040ez for 2012 That part of the building is to be occupied exclusively by the lessee (or any sublessee) of that part. Www.irs tax form 1040ez for 2012 The improvement is placed in service more than 3 years after the date the building was first placed in service. Www.irs tax form 1040ez for 2012   However, a qualified leasehold improvement does not include any improvement for which the expenditure is attributable to any of the following. Www.irs tax form 1040ez for 2012 The enlargement of the building. Www.irs tax form 1040ez for 2012 Any elevator or escalator. Www.irs tax form 1040ez for 2012 Any structural component benefiting a common area. Www.irs tax form 1040ez for 2012 The internal structural framework of the building. Www.irs tax form 1040ez for 2012   Generally, a binding commitment to enter into a lease is treated as a lease and the parties to the commitment are treated as the lessor and lessee. Www.irs tax form 1040ez for 2012 However, a binding commitment between related persons is not treated as a lease. Www.irs tax form 1040ez for 2012 Related persons. Www.irs tax form 1040ez for 2012   For this purpose, the following are related persons. Www.irs tax form 1040ez for 2012 Members of an affiliated group. Www.irs tax form 1040ez for 2012 The persons listed in items (1) through (9) under Related persons on page 8 of Publication 946 (except that “80% or more” should be substituted for “more than 10%” each place it appears). Www.irs tax form 1040ez for 2012 An executor and a beneficiary of the same estate. Www.irs tax form 1040ez for 2012 Tests To Be Met To qualify for the special depreciation allowance, the property must meet all of the following tests. Www.irs tax form 1040ez for 2012 Acquisition date test. Www.irs tax form 1040ez for 2012    Generally, you must have acquired the property either: After September 10, 2001, and before September 11, 2004, but only if no written binding contract for the acquisition was in effect before September 11, 2001, or Pursuant to a written binding contract entered into after September 10, 2001, and before September 11, 2004. Www.irs tax form 1040ez for 2012   Property you manufacture, construct, or produce for your own use meets this test if you began the manufacture, construction, or production of the property after September 10, 2001, and before September 11, 2004. Www.irs tax form 1040ez for 2012 Placed in service date test. Www.irs tax form 1040ez for 2012   Generally, the property must be placed in service for use in your trade or business or for the production of income after September 10, 2001, and before January 1, 2005. Www.irs tax form 1040ez for 2012   If you sold property you placed in service after September 10, 2001, and you leased it back within 3 months after the property was originally placed in service, the property is treated as placed in service no earlier than the date it is used under the leaseback. Www.irs tax form 1040ez for 2012 Original use test. Www.irs tax form 1040ez for 2012   The original use of the property must have begun with you after September 10, 2001. Www.irs tax form 1040ez for 2012 “Original use” means the first use to which the property is put, whether or not by you. Www.irs tax form 1040ez for 2012 Additional capital expenditures you incurred after September 10, 2001, to recondition or rebuild your property meet the original use test. Www.irs tax form 1040ez for 2012 Excepted Property The following property does not qualify for the special depreciation allowance. Www.irs tax form 1040ez for 2012 Property used by any person before September 11, 2001. Www.irs tax form 1040ez for 2012 Property required to be depreciated using ADS. Www.irs tax form 1040ez for 2012 This includes listed property used 50% or less in a qualified business use. Www.irs tax form 1040ez for 2012 Qualified New York Liberty Zone leasehold improvement property (defined next). Www.irs tax form 1040ez for 2012 Qualified New York Liberty Zone leasehold improvement property. Www.irs tax form 1040ez for 2012   This is any qualified leasehold improvement property (as defined earlier) if all of the following requirements are met. Www.irs tax form 1040ez for 2012 The improvement is to a building located in the New York Liberty Zone (defined later under New York Liberty Zone Benefits). Www.irs tax form 1040ez for 2012 The improvement is placed in service after September 10, 2001, and before January 1, 2007. Www.irs tax form 1040ez for 2012 No written binding contract for the improvement was in effect before September 11, 2001. Www.irs tax form 1040ez for 2012 Election Not To Claim the Allowance You can elect not to claim the special depreciation allowance for qualified property. Www.irs tax form 1040ez for 2012 If you make this election for any property, it applies to all property in the same property class placed in service during the year. Www.irs tax form 1040ez for 2012 To make this election, attach a statement to your return indicating you elect not to claim the allowance and the class of property for which you are making the election. Www.irs tax form 1040ez for 2012 When to make election. Www.irs tax form 1040ez for 2012   Generally, you must make the election on a timely filed tax return (including extensions) for the year in which you place the property in service. Www.irs tax form 1040ez for 2012   However, if you timely filed your return for the year without making the election, you can still make the election by filing an amended return within 6 months of the due date of the original return (not including extensions). Www.irs tax form 1040ez for 2012 Attach the election statement to the amended return. Www.irs tax form 1040ez for 2012 At the top of the election statement, write “Filed pursuant to section 301. Www.irs tax form 1040ez for 2012 9100–2. Www.irs tax form 1040ez for 2012 ” Revoking an election. Www.irs tax form 1040ez for 2012   Once you elect not to deduct the special depreciation allowance for a class of property, you cannot revoke the election without IRS consent. Www.irs tax form 1040ez for 2012 A request to revoke the election is subject to a user fee. Www.irs tax form 1040ez for 2012 Rules for Returns Filed Before June 1, 2002 The following rules apply if you placed qualified property in service after September 10, 2001, and filed your return before June 1, 2002. Www.irs tax form 1040ez for 2012 The rules apply to returns for the following years. Www.irs tax form 1040ez for 2012 2000 fiscal years that end after September 10, 2001. Www.irs tax form 1040ez for 2012 2001 calendar and fiscal years. Www.irs tax form 1040ez for 2012 Claiming the allowance. Www.irs tax form 1040ez for 2012   If you did not claim the allowance on your return and did not make the election not to claim the allowance, you can do either of the following to claim the allowance. Www.irs tax form 1040ez for 2012 File an amended return by the due date (not including extensions) of your return for the year following the year the property was placed in service. Www.irs tax form 1040ez for 2012 Write “Filed Pursuant to Rev. Www.irs tax form 1040ez for 2012 Proc. Www.irs tax form 1040ez for 2012 2002–33” at the top of the amended return. Www.irs tax form 1040ez for 2012 File Form 3115, Application for Change in Accounting Method, with your return for the year following the year the property was placed in service. Www.irs tax form 1040ez for 2012 Your return must be filed by the due date (including extensions). Www.irs tax form 1040ez for 2012 Write “Automatic Change Filed Under Rev. Www.irs tax form 1040ez for 2012 Proc. Www.irs tax form 1040ez for 2012 2002–33” on the appropriate line of Form 3115. Www.irs tax form 1040ez for 2012 You must also file a copy (with signature) of the completed Form 3115 with the IRS National Office no later than when you file the original with your return. Www.irs tax form 1040ez for 2012 For more information about filing Form 3115, including the address to send it to, see Revenue Procedure 2002–9, Revenue Procedure 2002–19, and Revenue Procedure 2002–33. Www.irs tax form 1040ez for 2012 Example 1. Www.irs tax form 1040ez for 2012 You are an individual and you use the calendar year. Www.irs tax form 1040ez for 2012 You placed qualified property in service for your business in December 2001. Www.irs tax form 1040ez for 2012 You filed your 2001 income tax return before April 15, 2002. Www.irs tax form 1040ez for 2012 You did not claim the special depreciation allowance for the property and did not make the election not to claim the allowance. Www.irs tax form 1040ez for 2012 You can claim the special allowance by filing an amended 2001 return by April 15, 2003, with “Filed Pursuant to Rev. Www.irs tax form 1040ez for 2012 Proc. Www.irs tax form 1040ez for 2012 2002–33” at the top of the amended return. Www.irs tax form 1040ez for 2012 You must file an amended return by April 15, 2003, even if you get an extension of time to file your 2002 tax return. Www.irs tax form 1040ez for 2012 Example 2. Www.irs tax form 1040ez for 2012 The facts concerning your 2001 return are the same as in Example 1. Www.irs tax form 1040ez for 2012 In addition, you got an automatic 4-month extension of time (to August 15, 2003) to file your 2002 return. Www.irs tax form 1040ez for 2012 You can claim the special allowance by filing a Form 3115 (with “Filed Pursuant to Rev. Www.irs tax form 1040ez for 2012 Proc. Www.irs tax form 1040ez for 2012 2002–33” on the appropriate line) with your 2002 return by August 15, 2003. Www.irs tax form 1040ez for 2012 You must also file a copy of this Form 3115 with the IRS National Office no later than when you file your 2002 return. Www.irs tax form 1040ez for 2012 Electing not to claim the allowance. Www.irs tax form 1040ez for 2012   Generally, you have elected not to claim the special depreciation allowance for a class of property if you: Filed your return timely (including extensions) for the year you placed qualified property in service and indicated on a statement with the return that you are not claiming the allowance, or Filed your return timely and filed an amended return within 6 months of the due date of the original return (not including extensions) and indicated on a statement with the amended return that you are not claiming the allowance. Www.irs tax form 1040ez for 2012 The statement must indicate that you are not deducting the special depreciation allowance and the class of property to which the election applies. Www.irs tax form 1040ez for 2012 The statement can be either attached to or written on the return. Www.irs tax form 1040ez for 2012 You can, for example, write “not deducting 30%” on Form 4562. Www.irs tax form 1040ez for 2012 Deemed election. Www.irs tax form 1040ez for 2012   If you have not followed either of the procedures described above to elect not to claim the allowance, you may still be treated as making the election. Www.irs tax form 1040ez for 2012 You will be treated as making the election if you meet both of the following conditions. Www.irs tax form 1040ez for 2012 You filed your return for the year you placed the property in service and claimed depreciation, but not the special allowance, for any class of property. Www.irs tax form 1040ez for 2012 You do not file an amended return or a Form 3115 within the time prescribed for claiming the special allowance. Www.irs tax form 1040ez for 2012 See Claiming the allowance, earlier. Www.irs tax form 1040ez for 2012 Passenger Automobiles The limit on your depreciation deduction (including any section 179 deduction) for any passenger automobile that is qualified property (defined earlier) placed in service after September 10, 2001, and for which you claim the special depreciation allowance is increased. Www.irs tax form 1040ez for 2012 Generally, the limit is increased from $3,060 to $7,660. Www.irs tax form 1040ez for 2012 However, if the automobile is a qualified electric car, the limit is increased from $9,280 to $23,080 ($22,980 if placed in service in 2002). Www.irs tax form 1040ez for 2012 Table 1 shows the maximum deduction amounts for 2001. Www.irs tax form 1040ez for 2012 Table 1. Www.irs tax form 1040ez for 2012 Maximum Deduction for 2001 Qualified Vehicle Placed in Service Before Sept. Www.irs tax form 1040ez for 2012 11 Placed in Service After Sept. Www.irs tax form 1040ez for 2012 10 Passenger automobile $3,060 $7,660 Electric car 9,280 23,080 1 1$22,980 if you place an electric car in service in 2002. Www.irs tax form 1040ez for 2012 Election not to claim the allowance. Www.irs tax form 1040ez for 2012   The increased maximum depreciation deduction does not apply if you elected not to claim the special depreciation allowance as explained earlier under Election Not To Claim the Allowance and Rules for Returns Filed Before June 1, 2002. Www.irs tax form 1040ez for 2012 New York Liberty Zone Benefits Several benefits are available for property you place in service in the New York Liberty Zone (Liberty Zone). Www.irs tax form 1040ez for 2012 They include a special depreciation allowance for the year you place the property in service, an increased section 179 deduction, and the classification of certain leasehold improvement property as 5-year property. Www.irs tax form 1040ez for 2012 Area defined. Www.irs tax form 1040ez for 2012   The New York Liberty Zone is the area located on or south of Canal Street, East Broadway (east of its intersection with Canal Street), or Grand Street (east of its intersection with East Broadway) in the Borough of Manhattan in the City of New York, New York. Www.irs tax form 1040ez for 2012 Special Liberty Zone Depreciation Allowance You can take a special depreciation allowance for qualified Liberty Zone property you place in service after September 10, 2001. Www.irs tax form 1040ez for 2012 The allowance is an additional deduction of 30% of the property's depreciable basis. Www.irs tax form 1040ez for 2012 To figure the depreciable basis, you must first multiply the property's cost or other basis by the percentage of business/investment use and then reduce that amount by any section 179 deduction and certain other deductions and credits for the property. Www.irs tax form 1040ez for 2012 See What Is the Basis for Depreciation? on page 23 in Publication 946 for more information on figuring depreciable basis. Www.irs tax form 1040ez for 2012 The allowance is deductible for both regular tax and alternative minimum tax (AMT) purposes. Www.irs tax form 1040ez for 2012 There is no AMT adjustment required for any depreciation figured on the remaining basis of the property. Www.irs tax form 1040ez for 2012 In the year you claim the allowance (generally the year you place the property in service), you must reduce the depreciable basis of the property by the allowance before figuring your regular depreciation deduction. Www.irs tax form 1040ez for 2012 You cannot claim the special Liberty Zone depreciation allowance for property eligible for the special depreciation allowance explained earlier in Qualified Property under Special Depreciation Allowance. Www.irs tax form 1040ez for 2012 Qualified property is eligible for only one special depreciation allowance. Www.irs tax form 1040ez for 2012 Example 1. Www.irs tax form 1040ez for 2012 On November 1, 2001, you bought and placed in service in your business, which is in the Liberty Zone, qualified Liberty Zone property that cost $200,000. Www.irs tax form 1040ez for 2012 You did not elect to claim a section 179 deduction. Www.irs tax form 1040ez for 2012 You can deduct 30% of the cost ($60,000) as a special Liberty Zone depreciation allowance for 2001. Www.irs tax form 1040ez for 2012 You use the remaining $140,000 of cost to figure your regular depreciation deduction for 2001 and later years. Www.irs tax form 1040ez for 2012 Example 2. Www.irs tax form 1040ez for 2012 The facts are the same as in Example 1, except that you choose to deduct $59,000 of the property's cost as a section 179 deduction. Www.irs tax form 1040ez for 2012 (See Increased Section 179 Deduction, later, for information concerning how this section 179 deduction amount is figured). Www.irs tax form 1040ez for 2012 You use the remaining $141,000 of cost to figure your special Liberty Zone depreciation allowance of $42,300 ($141,000 × 30%). Www.irs tax form 1040ez for 2012 You use the remaining $98,700 of cost to figure your regular depreciation deduction for 2001 and later years. Www.irs tax form 1040ez for 2012 Qualified Liberty Zone Property For a 2001 calendar or fiscal year and a 2000 fiscal year that ends after September 10, 2001, property qualifies for the special Liberty Zone depreciation allowance if it meets the following requirements. Www.irs tax form 1040ez for 2012 It is one of the following types of property. Www.irs tax form 1040ez for 2012 Used property depreciated under MACRS with a recovery period of 20 years or less. Www.irs tax form 1040ez for 2012 See Can You Use MACRS To Depreciate Your Property and Which Recovery Period Applies? on pages 7 and 23, respectively, in Publication 946. Www.irs tax form 1040ez for 2012 Used water utility property. Www.irs tax form 1040ez for 2012 See 25-year property on page 22 in Publication 946. Www.irs tax form 1040ez for 2012 Used computer software that is not a section 197 intangible as described in Computer software on page 5 in Publication 946. Www.irs tax form 1040ez for 2012 (The cost of some computer software is treated as part of the cost of hardware and is depreciated under MACRS. Www.irs tax form 1040ez for 2012 ) Certain nonresidential real property and residential rental property (defined later). Www.irs tax form 1040ez for 2012 It meets the following tests (explained later under Tests to be met). Www.irs tax form 1040ez for 2012 Acquisition date test. Www.irs tax form 1040ez for 2012 Placed in service date test. Www.irs tax form 1040ez for 2012 Substantial use test. Www.irs tax form 1040ez for 2012 Original use test. Www.irs tax form 1040ez for 2012 It is not excepted property (explained later under Excepted property). Www.irs tax form 1040ez for 2012 Nonresidential real property and residential rental property. Www.irs tax form 1040ez for 2012   This property is qualifying property only to the extent it rehabilitates real property damaged, or replaces real property destroyed or condemned, as a result of the terrorist attack of September 11, 2001. Www.irs tax form 1040ez for 2012 Property is treated as replacing destroyed or condemned property if, as part of an integrated plan, such property replaces real property included in a continuous area that includes real property destroyed or condemned. Www.irs tax form 1040ez for 2012   For these purposes, real property is considered destroyed (or condemned) only if an entire building or structure was destroyed (or condemned) as a result of the terrorist attack. Www.irs tax form 1040ez for 2012 Otherwise, the property is considered damaged real property. Www.irs tax form 1040ez for 2012 For example, if certain structural components of a building (such as walls, floors, or plumbing fixtures) are damaged or destroyed as a result of the terrorist attack, but the building is not destroyed (or condemned), then only costs related to replacing the damaged or destroyed structural components qualify for the special Liberty Zone depreciation allowance. Www.irs tax form 1040ez for 2012 Tests to be met. Www.irs tax form 1040ez for 2012   To qualify for the special Liberty Zone depreciation allowance, your property must meet all of the following tests. Www.irs tax form 1040ez for 2012 Acquisition date test. Www.irs tax form 1040ez for 2012   You must have acquired the property by purchase after September 10, 2001, and there must not have been a binding written contract for the acquisition in effect before September 11, 2001. Www.irs tax form 1040ez for 2012   For information on the acquisition of property by purchase, see Property Acquired by Purchase on page 15 of Publication 946. Www.irs tax form 1040ez for 2012   Property you manufacture, construct, or produce for your own use meets this test if you began the manufacture, construction, or production of the property after September 10, 2001. Www.irs tax form 1040ez for 2012 Placed in service date test. Www.irs tax form 1040ez for 2012   Generally, the property must be placed in service for use in your trade or business or for the production of income before January 1, 2007 (January 1, 2010, in the case of qualifying nonresidential real property and residential rental property). Www.irs tax form 1040ez for 2012   If you sold property you placed in service after September 10, 2001, and you leased it back within 3 months after the property was originally placed in service, the property is treated as placed in service no earlier than the date it is used under the leaseback. Www.irs tax form 1040ez for 2012 Substantial use test. Www.irs tax form 1040ez for 2012   Substantially all use of the property must be in the Liberty Zone and in the active conduct of your trade or business in the Liberty Zone. Www.irs tax form 1040ez for 2012 Original use test. Www.irs tax form 1040ez for 2012   The original use of the property in the Liberty Zone must have begun with you after September 10, 2001. Www.irs tax form 1040ez for 2012   Used property can be qualified Liberty Zone property if it has not previously been used within the Liberty Zone. Www.irs tax form 1040ez for 2012 Also, additional capital expenditures you incurred after September 10, 2001, to recondition or rebuild your property meet the original use test if the original use of the property in the Liberty Zone began with you. Www.irs tax form 1040ez for 2012 Excepted property. Www.irs tax form 1040ez for 2012   The following property does not qualify for the special Liberty Zone depreciation allowance. Www.irs tax form 1040ez for 2012 Property eligible for the special depreciation allowance explained earlier in Qualified Property under Special Depreciation Allowance. Www.irs tax form 1040ez for 2012 Property required to be depreciated using ADS. Www.irs tax form 1040ez for 2012 This includes listed property used 50% or less in a qualified business use. Www.irs tax form 1040ez for 2012 Qualified New York Liberty Zone leasehold improvement property (defined earlier in Excepted Property under Special Depreciation Allowance). Www.irs tax form 1040ez for 2012 Example. Www.irs tax form 1040ez for 2012 In December 2001, you bought and placed in service in your business in the Liberty Zone the following property. Www.irs tax form 1040ez for 2012 New office furniture with a MACRS recovery period of 7 years. Www.irs tax form 1040ez for 2012 A used computer with a MACRS recovery period of 5 years. Www.irs tax form 1040ez for 2012 The computer had not previously been used within the Liberty Zone. Www.irs tax form 1040ez for 2012 Because the office furniture is new property, it qualifies for the special depreciation allowance, but not the special Liberty Zone depreciation allowance. Www.irs tax form 1040ez for 2012 Because the computer is used property that had not previously been used in the Liberty Zone, it qualifies for the special Liberty Zone depreciation allowance, but not the special depreciation allowance. Www.irs tax form 1040ez for 2012 Election Not To Claim the Liberty Zone Allowance You can elect not to claim the special Liberty Zone depreciation allowance for qualified property. Www.irs tax form 1040ez for 2012 If you make this election for any property, it applies to all property in the same property class placed in service during the year. Www.irs tax form 1040ez for 2012 To make this election, attach a statement to your return indicating you elect not to claim the allowance and the class of property for which you are making the election. Www.irs tax form 1040ez for 2012 When to make the election. Www.irs tax form 1040ez for 2012   Generally, you must make the election on a timely filed tax return (including extensions) for the year in which you place the property in service. Www.irs tax form 1040ez for 2012   However, if you timely filed your return for the year without making the election, you can still make the election by filing an amended return within 6 months of the due date of the original return (not including extensions). Www.irs tax form 1040ez for 2012 Attach the election statement to the amended return. Www.irs tax form 1040ez for 2012 At the top of the election statement, write “Filed pursuant to section 301. Www.irs tax form 1040ez for 2012 9100–2. Www.irs tax form 1040ez for 2012 ” Revoking an election. Www.irs tax form 1040ez for 2012   Once you elect not to deduct the special Liberty Zone depreciation allowance for a class of property, you cannot revoke the election without IRS consent. Www.irs tax form 1040ez for 2012 A request to revoke the election is subject to a user fee. Www.irs tax form 1040ez for 2012 Returns filed before June 1, 2002. Www.irs tax form 1040ez for 2012   The rules that apply to the special depreciation allowance discussed earlier in Rules for Returns Filed Before June 1, 2002 under Special Depreciation Allowance also apply to the special Liberty Zone depreciation allowance. Www.irs tax form 1040ez for 2012 Increased Section 179 Deduction Under section 179 of the Internal Revenue Code, you can choose to recover all or part of the cost of certain qualifying property, up to a limit, by deducting it in the year you place the property in service. Www.irs tax form 1040ez for 2012 For tax years beginning in 2000, that limit was $20,000. Www.irs tax form 1040ez for 2012 For tax years beginning in 2001 and 2002, that limit is generally $24,000. Www.irs tax form 1040ez for 2012 If the cost of qualifying section 179 property placed in service in a year is over $200,000, you must reduce the dollar limit (but not below zero) by the amount of the cost over $200,000. Www.irs tax form 1040ez for 2012 Increased Dollar Limit The dollar limit on the section 179 deduction is increased for certain property placed in service in the Liberty Zone. Www.irs tax form 1040ez for 2012 The increase is the smaller of the following amounts. Www.irs tax form 1040ez for 2012 $35,000. Www.irs tax form 1040ez for 2012 The cost of section 179 property that is qualified Liberty Zone property placed in service during the year. Www.irs tax form 1040ez for 2012 If you use the revised 2001 Form 4562 (dated March 2002) for a tax year beginning in 2000, you must reduce the section 179 dollar limit to $20,000 before adding the additional amount for qualified property. Www.irs tax form 1040ez for 2012 Qualified property. Www.irs tax form 1040ez for 2012   To qualify for the increased section 179 deduction, your property must be section 179 property that is either: Qualified Liberty Zone property, or Property that would be qualified Liberty Zone property except that it is eligible for the special depreciation allowance. Www.irs tax form 1040ez for 2012 Qualified Liberty Zone property is explained earlier in Qualified Liberty Zone Property under Special Liberty Zone Depreciation Allowance. Www.irs tax form 1040ez for 2012 Property eligible for the special depreciation allowance is explained earlier in Qualified Property under Special Depreciation Allowance. Www.irs tax form 1040ez for 2012 For information on the requirements that must be met for property to qualify for the section 179 deduction, see What Property Qualifies? on page 14 of Publication 946. Www.irs tax form 1040ez for 2012 Example 1. Www.irs tax form 1040ez for 2012 In 2002, you place in service in your business, which is in the Liberty Zone, qualified property (defined earlier) costing $25,000. Www.irs tax form 1040ez for 2012 Because this cost is less than $35,000, the dollar limit on the section 179 deduction is increased by $25,000 to $49,000 ($24,000 + $25,000). Www.irs tax form 1040ez for 2012 Example 2. Www.irs tax form 1040ez for 2012 In 2002, you place in service in your business, which is in the Liberty Zone, qualified property (defined earlier) costing $75,000. Www.irs tax form 1040ez for 2012 Because $35,000 is less than the cost of the property you place in service, the dollar limit on the section 179 deduction you can claim is increased by $35,000 to $59,000 ($24,000 + $35,000). Www.irs tax form 1040ez for 2012 Reduced Dollar Limit Generally, you must reduce the dollar limit for a year by the cost of qualifying section 179 property placed in service in the year that is more than $200,000. Www.irs tax form 1040ez for 2012 However, if the cost of your Liberty Zone property exceeds $200,000, you take into account only 50% (instead of 100%) of the cost of qualified property placed in service in a year. Www.irs tax form 1040ez for 2012 Example. Www.irs tax form 1040ez for 2012 In 2002, you place in service in your business, which is in the Liberty Zone, qualified property costing $460,000. Www.irs tax form 1040ez for 2012 Your increased dollar limit is $59,000 ($35,000 + $24,000). Www.irs tax form 1040ez for 2012 Because 50% of the cost of the property you place in service ($230,000) is $30,000 more than $200,000, you must reduce your $59,000 dollar limit to $29,000 ($59,000 - $30,000). Www.irs tax form 1040ez for 2012 Recapture Rules Rules similar to those explained on page 20 of Publication 946 under When Must You Recapture the Deduction? apply with respect to any qualified property you stop using in the Liberty Zone. Www.irs tax form 1040ez for 2012 Returns Filed Before June 1, 2002 If you filed a return before June 1, 2002, and did not deduct the increased section 179 amount for qualified property placed in service after September 10, 2001, you can deduct the increased amount by filing an amended return by the due date (not including extensions) of the return for the year after the year the property was placed in service. Www.irs tax form 1040ez for 2012 This rule applies to returns for the following years. Www.irs tax form 1040ez for 2012 2000 fiscal years that end after September 10, 2001. Www.irs tax form 1040ez for 2012 2001 calendar and fiscal years. Www.irs tax form 1040ez for 2012 On the amended return, write “Filed Pursuant to Rev. Www.irs tax form 1040ez for 2012 Proc. Www.irs tax form 1040ez for 2012 2002–33. Www.irs tax form 1040ez for 2012 ” Liberty Zone Leasehold Improvement Property Qualified Liberty Zone leasehold improvement property (described earlier in Qualified Property under Special Depreciation Allowance) is 5-year property. Www.irs tax form 1040ez for 2012 This means that it is depreciated over a recovery period of 5 years. Www.irs tax form 1040ez for 2012 For information about recovery periods, see Which Recovery Period Applies? on page 23 of Publication 946. Www.irs tax form 1040ez for 2012 The straight-line method must be used with respect to qualified Liberty Zone leasehold improvement property. Www.irs tax form 1040ez for 2012 Under ADS, the recovery period for qualified Liberty Zone leasehold improvement property is 9 years. Www.irs tax form 1040ez for 2012 Returns Filed Before June 1, 2002 If you filed either of the following returns before June 1, 2002, and did not depreciate qualified Liberty Zone leasehold improvement property placed in service during the tax year as 5-year property using the straight line method, you should file an amended return before you file your return for the year after the year the property was placed in service. Www.irs tax form 1040ez for 2012 Your 2000 fiscal year return (for a 2000 fiscal year that ends after September 10, 2001). Www.irs tax form 1040ez for 2012 Your 2001 calendar or fiscal year return. Www.irs tax form 1040ez for 2012 On the amended return, write “Filed Pursuant to Rev. Www.irs tax form 1040ez for 2012 Proc. Www.irs tax form 1040ez for 2012 2002–33. Www.irs tax form 1040ez for 2012 ” Table 2. Www.irs tax form 1040ez for 2012 Rules for Returns Filed Before June 1, 2002 Note:This chart highlights the rules for returns affected by the Job Creation and Worker Assistance Act of 2002 that were filed before June 1, 2002, without accounting for any of the new benefits under the law. Www.irs tax form 1040ez for 2012 See the text for definitions and examples. Www.irs tax form 1040ez for 2012 Do not rely on this chart alone. Www.irs tax form 1040ez for 2012 IF you want to. Www.irs tax form 1040ez for 2012 . Www.irs tax form 1040ez for 2012 . Www.irs tax form 1040ez for 2012 THEN you. Www.irs tax form 1040ez for 2012 . Www.irs tax form 1040ez for 2012 . Www.irs tax form 1040ez for 2012 BY. Www.irs tax form 1040ez for 2012 . Www.irs tax form 1040ez for 2012 . Www.irs tax form 1040ez for 2012 claim the special depreciation allowance or special Liberty Zone depreciation allowance • must file an amended return • the due date (not including extensions) of your return for the year after the year the property was placed in service, or • must file Form 3115, Application for Change in Accounting Method, with your return for the year after the year the property was placed in service • the due date (including extensions) of your return for the year after the year the property was placed in service, and • must file a copy of your completed Form 3115 with the IRS National Office • the date you file the original Form 3115 with your return for the year after the year the property was placed in service. Www.irs tax form 1040ez for 2012 elect not to claim the special depreciation allowance or the special Liberty Zone depreciation allowance 1 • must have filed your return timely for the year the property was placed in service, and   • must file an amended return stating you are not claiming the allowance • the date that is 6 months after the due date of the original return (not including extensions). Www.irs tax form 1040ez for 2012 deduct the increased section 179 amount • must file an amended return • the due date (not including extensions) of your return for the year after the year the property was placed in service. Www.irs tax form 1040ez for 2012 use a 5-year recovery period for depreciating qualified Liberty Zone leasehold improvement property • should file an amended return • the date you file your return for the year after the year the property was placed in service. Www.irs tax form 1040ez for 2012 1See also Deemed election under Rules for Returns Filed Before June 1, 2002, earlier. Www.irs tax form 1040ez for 2012 Prev  Up  Next   Home   More Online Publications