We, therefore, the undersigned citizens of the United States, petition the U.S. Congress to act immediately to lower gasoline prices (and diesel and other fuel prices)* by authorizing the exploration of proven energy reserves to reduce our dependence on foreign energy sources from unstable countries.

Join the 842,592 people who have signed the petition.

Sign The Petition

Number Signed June 17, 2008--842,592

June 18--903,692

IRA'S What's New for 2008 (Part 6)-See Part 1-5 Below

Statement of required minimum distribution

If a minimum distribution is required from your IRA, the trustee, custodian, or issuer that held the IRA at the end of the preceding year must either report the amount of the required minimum distribution to you, or offer to calculate it for you. The report or offer must include the date by which the amount must be distributed. The report is due January 31 of the year in which the minimum distribution is required. It can be provided with the year-end fair market value statement that you normally get each year. No report is required for section 403(b) contracts (generally tax-sheltered annuities) or for IRAs of owners who have died.

IRA interest. Although interest earned from your IRA is generally not taxed in the year earned, it is not tax-exempt interest. Do not report this interest on your return as tax-exempt interest.

Hurricane tax relief. Special rules apply to the use of retirement funds (including IRAs) by qualified individuals who suffered an economic loss as a result of Hurricane Katrina, Rita, or Wilma. While qualified hurricane distributions can no longer be made, special rules apply to the repayment of these distributions. See chapter 4, Hurricane-Related Relief, for information on these special rules.

Photographs of missing children. The Internal Revenue Service is a proud partner with the National Center for Missing and Exploited Children. Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child.

IRA'S What's New for 2008 (Part 5)-See Part 1-4 Below

Reminders

Simplified employee pension (SEP). SEP IRAs are not covered in this publication. They are covered in Publication 560, Retirement Plans for Small Business.

Deemed IRAs. A qualified employer plan (retirement plan) can maintain a separate account or annuity under the plan (a deemed IRA) to receive voluntary employee contributions.

If the separate account or annuity otherwise meets the requirements of an IRA, it will be subject only to IRA rules. An employee's account can be treated as a traditional IRA or a Roth IRA. For this purpose, a “qualified employer plan” includes:

A qualified pension, profit-sharing, or stock bonus plan (section 401(a) plan),

A qualified employee annuity plan (section 403(a) plan),

A tax-sheltered annuity plan (section 403(b) plan), and

A deferred compensation plan (section 457 plan) maintained by a state, a political subdivision of a state, or an agency or instrumentality of a state or political subdivision of a state.

IRA'S What's New for 2008 (Part 4)-See Part 1 & 2 & 3 Below

Modified AGI limit for retirement savings contributions credit increased. For 2008, you may be able to claim the retirement savings contributions credit if your modified adjusted gross income (AGI) is not more than:

$53,000 if your filing status is married filing jointly,

$39,750 if your filing status is head of household, or

$26,500 if your filing status is single, married filing separately, or qualifying widow(er).

See Can you claim the credit? in chapter 5.

Rollovers from other retirement plans. For 2008, you can roll over amounts from an eligible retirement plan into a Roth IRA.

IRA'S What's New for 2008 (Part 3)-See Part 1 & 2 Below

Modified AGI limit for Roth IRA contributions increased. For 2008, your Roth IRA contribution limit is reduced (phased out) in the following situations.

Your filing status is married filing jointly or qualifying widow(er) and your modified AGI is at least $159,000. You cannot make a Roth IRA contribution if your modified AGI is $169,000 or more.

Your filing status is single, head of household, or married filing separately and you did not live with your spouse at any time in 2008 and your modified AGI is at least $101,000. You cannot make a Roth IRA contribution if your modified AGI is $116,000 or more.

Your filing status is married filing separately, you lived with your spouse at any time during the year, and your modified AGI is more than -0-. You cannot make a Roth IRA contribution if your modified AGI is $10,000 or more.

IRA'S What's New for 2008 Part 2-See Part 1 Below

Traditional IRA contribution and deduction limit. The contribution limit to your traditional IRA for 2008 will be increased to the smaller of the following amounts:

$5,000, or

Your taxable compensation for the year.

If you were age 50 or older before 2009, the most that can be contributed to your traditional IRA for 2008 will be the smaller of the following amounts:

$6,000, or

Your taxable compensation for the year.

For more information, see How Much Can Be Contributed? in chapter 1.

Roth IRA contribution limit. If contributions on your behalf are made only to Roth IRAs, your contribution limit for 2008 will generally be the lesser of:

$5,000, or

Your taxable compensation for the year.

If you were age 50 or older before 2009 and contributions on your behalf were made only to Roth IRAs, your contribution limit for 2008 will generally be the lesser of:

$6,000, or

Your taxable compensation for the year.

However, if your modified adjusted gross income (AGI) is above a certain amount, your contribution limit may be reduced. For more information, see How Much Can Be Contributed? under Can You Contribute to a Roth IRA? in chapter 2.

Modified AGI limit for traditional IRA contributions increased. For 2008, if you are covered by a retirement plan at work, your deduction for contributions to a traditional IRA is reduced (phased out) if your modified adjusted gross income (AGI) is:

More than $85,000 but less than $105,000 for a married couple filing a joint return or a qualifying widow(er),

More than $53,000 but less than $63,000 for a single individual or head of household, or

Less than $10,000 for a married individual filing a separate return.

If you either live with your spouse or file a joint return, and your spouse is covered by a retirement plan at work, but you are not, your deduction is phased out if your AGI is more than $159,000 but less than $169,000. If your AGI is $169,000 or more, you cannot take a deduction for contributions to a traditional IRA. See How Much Can You Deduct? in chapter 1.

Roth IRA Contributions

A Roth IRA is an account or annuity set up in the United States solely for the benefit of you or your beneficiaries. It is an individual retirement plan.

However, it differs from traditional IRAs in that contributions are not deductible. For information on contributions and the limitations please refer to Chapter 2 of the Publication 590, Individual Retirement Arrangements.

Introduction

This publication discusses individual retirement arrangements (IRAs). An IRA is a personal savings plan that gives you tax advantages for setting aside money for retirement.What are some tax advantages of an IRA? Two tax advantages of an IRA are that:

Contributions you make to an IRA may be fully or partially deductible, depending on which type of IRA you have and on your circumstances, and

Generally, amounts in your IRA (including earnings and gains) are not taxed until distributed. In some cases, amounts are not taxed at all if distributed according to the rules.

Amended Returns

If you discover an error after your return has been mailed, you may need to amend your return. The service center may correct errors in math on a return and may accept returns with certain forms or schedules left out.

In these instances, do not amend your return! However, do file an amended return if your filing status, your income, your deductions or credits were incorrect.

Use Form 1040X (PDF), Amended U.S. Individual Income Tax Return, to correct a previously filed Form 1040 (PDF), Form 1040A (PDF), Form 1040EZ (PDF), Form 1040NR (PDF), or Form 1040NR-EZ (PDF). If you are filing to claim an additional refund, wait until you have received your original refund (you may cash that check).

To avoid penalty and interest, if you owe additional tax for a current year amended return, file Form 1040X and pay the tax by April 15 of the current year. If the due date falls on a Saturday, Sunday, or legal holiday, the due date is delayed until the next business day. The Form 1040X Instructions list the addresses for the service centers.

File a separate Form 1040X for each year you are amending. Mail each form in a separate envelope. Be sure to enter the year of the return you are amending at the top of Form 1040X. The form has three columns.

Column A shows original or adjusted figures from the original return. Column C shows the corrected figures. The difference between Columns A and C is shown in Column B. There is an area on the back of the form to explain the specific changes being made and the reason for each change.

Attach any forms or schedules that are affected by the change. Generally, to claim a refund, Form 1040X must be filed within 3 years from the date of your original return or within 2 years from the date you paid the tax, whichever is later.

Please Note: Your state tax liability may be affected by a change made on your federal return. For information on how to correct your state tax return, contact your state tax agency.

Backup Withholding

Banks and other businesses that pay you certain kinds of income must file Form 1099, an information return, with the IRS. Generally, these payments are not subject to withholding; however they may be subject to backup withholding.

Payments that may be subject to "backup withholding" include interest, dividends, rents, royalties, payments for work you do as an independent contractor, and broker payments. Under the backup withholding rules, the business or bank must withhold on a payment if:

You have not given the payer your taxpayer identification number in the required manner,

The IRS has notified the payer that the taxpayer identification number you provided is incorrect.

The IRS has notified the payer to start withholding on interest and dividends because you had not reported all of your interest or dividend income in prior years; or

You have not certified, when required, that you were not subject to backup withholding on interest and dividends.

Payers who withhold income tax under the backup withholding rules must show the tax withheld on a Form 1099. The payer must send you this form by January 31.

If you have not received it by then, contact the bank or business that made payments to you. You should report the amount of tax withheld in the payment section on your Form 1040 (PDF), or Form 1040A (PDF).

More detailed information on the backup withholding rules and procedures for payers can be found in Publication 1281 (PDF).

For more information, refer to Publication 505, Tax Withholding and Estimated Tax.

Penalty for Underpayment of Estimated Tax

The United States income tax is a pay–as–you–go tax, which means that tax must be paid as you earn or receive your income during the year. You can either do this through withholding or by making estimated tax payments.

If you do not pay enough tax, you may have to pay a penalty for underpayment of estimated tax. Generally, most taxpayers will have paid enough tax to avoid this penalty if they paid at least 90% of the tax for the current year, or 100% of the tax shown on the return for the prior year, whichever is smaller.

There are special rules for farmers and fishermen. Please refer to Publication 505, Tax Withholding and Estimated Tax, for additional information.

Generally, the payments should be made in four equal amounts to avoid a penalty. However, if you made unequal payments because your income was received unevenly during the year, you may be able to avoid or lower the penalty by annualizing your income.

Use Form 2210 (PDF), Underpayment of Estimated Tax by Individuals and Fiduciaries, to see if you owe a penalty for underpaying your estimated tax.

The penalty may be waived if:

1. The failure to make estimated payments was caused by a casualty, disaster, or other unusual circumstance and it would be inequitable to impose the penalty, or

2. You retired (after reaching age 62) or became disabled during the tax year for which estimated payments were required to be made or in the preceding tax year, and the underpayment was due to reasonable cause and not willful neglect.

Please refer to the Form 1040 Instructions or the Form 1040A Instructions for where to report the estimated tax penalty on your return.

Recordkeeping

Well–organized records will make it easier to prepare your tax return and will help you answer questions if your return is selected for examination, or prepare any response if you are billed for additional tax.

Records such as receipts, canceled checks, and other documents that support an item of income or a deduction appearing on your return should be kept until the statute of limitations expires for that return.

For assessment of tax you owe, this generally is 3 years from the date you filed the return. For filing a claim for credit or refund, this generally is 3 years from the date the original return was filed, or 2 years from the date the tax was paid, whichever is later.

Returns filed before the due date are treated as filed on the due date. There is no statute of limitations when a return is fraudulent or when no return is filed.

If you are an employer, you must keep all your employment tax records for at least 4 years after the tax becomes due or is paid, whichever is later.

If you are in business, there is no particular method of bookkeeping you must use. However, you must use a method that clearly and accurately reflects your gross income and expenses.

The records should substantiate both your income and expenses. Publication 583, Starting a Business and Keeping Records, and Publication 463, Travel, Entertainment, Gift, and Car Expenses, provide additional information on required documentation for taxpayers with business expenses. Publication 552, Recordkeeping for Individuals, provides more information on recordkeeping requirements for individuals.

Checklist of Common Errors When Preparing Your Tax Return

Before filing your return, review it to make sure it is correct and complete. The following checklist may help you avoid errors:

Did you use the peel–off label and enter any corrections? If you used the label, did you enter your social security number in the space provided?

If you do not have a label, or there are too many corrections, did you clearly print your name, social security number, and address, including zip code directly on your return?

Did you enter the names and social security numbers for yourself, your spouse, your dependents, and qualifying children for earned income credit or child tax credit, exactly as they appear on the social security cards? If there have been any name changes be sure to go to www.ssa.gov or call at 1–800–772–1213.

Did you check only one filing status?

Did you check the appropriate exemption boxes and enter the names and social security numbers exactly as they appear on the Social Security Card, for all of the dependents claimed? Is the total number of exemptions entered?

Did you enter income, deductions, and credits on the correct lines and are the totals correct?

If you show a negative amount on your return, did you put brackets around it?

If you are taking the standard deduction and checked any box indicating either you or your spouse were age 65 or older or blind, did you find the correct standard deduction using the worksheet in the Form 1040 Instructions or the Form 1040A Instructions?

Did you figure the tax correctly? If you used the tax tables, did you use the correct column for your filing status?

Did you sign and date the return? If it is a joint return, did your spouse also sign and date the return?

Do you have a Form W-2 (PDF) from all of your employers and did you attach Copy B of each to your return? File only one return, even if you have more than one job. Combine the wages and withholding from all Form W-2's, on one return.

Did you attach any Form 1099-R (PDF) that shows tax withheld?

Did you attach all other necessary schedules and forms in sequence number order given in the upper right–hand corner?

If you owe tax, did you enclose a check or money order with the return and write your social security number, tax form, and tax year on the payment? Refer to Topic 158 for more information, and

If you are due a refund and requested direct deposit did you check the routing and account numbers?

Did you make a copy of the signed return and all schedules for your records?

A few of the most common errors are:

1. Incorrect or missing social security numbers.

2. Incorrect tax entered from the tables.

3. Computation errors in figuring the child and dependent care credit or the earned income credit. Also, missing or incorrect identification numbers for child care providers.

4. Withholding and estimated tax payments entered on the wrong line, and

5. Math Errors. Both addition and subtraction.

It is important that you review your entire return because any errors may delay the processing of your return.

Extensions of Time to File Your Tax Return

There are three choices for filing Form 4868 (PDF), Application For Automatic Extension of Time To File U.S. Individual Tax Return, electronically (such as by computer), by paying part of your tax due with a credit card through an outside service provider listed on the form, or by mail.

If you file your Form 4868 electronically you will receive an acknowledgement or confirmation number for your records and you do not need to send in Form 4868. If you need to pay additional taxes, you may do so through the outside service provider or through e-file. If you were or are serving in a combat zone, a qualified hazardous duty area, or in a contingency operation, refer to Topic 301 for more information about extensions.

You can refer to your tax software or tax professional for ways to file electronically using e-file services. If you wish to make a payment using the electronic funds withdrawal option, be sure to have a copy of last year's tax return. You will be asked to provide the Adjusted Gross Income from the return for taxpayer verification.

Besides filing electronically, you can generally get an extension of time to file if you pay part or all of your estimate of income tax due by credit card. You may pay by phone or Internet through one of the service providers listed on Form 4868.

Each service provider will charge a convenience fee based on the amount of the tax payment. At the completion of the transaction, you will receive a confirmation number for your records.

In addition to filing Form 4868 electronically, or by paying part of your tax by credit card, you can file Form 4868 by filling out the form and mailing it to the place where you will file your return.

Please be aware that an extension of time to file is NOT an extension of time to pay.

The State Government page on the IRS web site also contains information useful to individuals. Visit the taxation links for each state's site to find information on individual tax issues, including electronic filing.

When, Where, and How to File

April 15 each year is the due date for filing your Federal individual income tax return, if your tax year ends December 31st. Your return is considered filed timely if the envelope is properly addressed and postmarked no later than April 15.

If you use a fiscal year (which is a year ending on the last day of any month other than December), your return is due on or before the 15th day of the fourth month after the close of your fiscal year.

If the due date falls on a Saturday, Sunday, or legal holiday, the due date is delayed until the next business day (i.e., Tax Year 2006 is due April 17, 2007).

If you cannot file by the due date of your return, then you can request an extension of time to file. However, an extension of time to file is not an extension of time to pay.

You will owe interest on any past–due tax and you may be subject to a late–payment penalty if payment is not made timely. To receive an automatic 6-month extension of time to file your return, you can file Form 4868 (PDF) by the due date of your return. For more information, refer to the Form 4868 Instructions.

If you are a United States citizen or resident, whose home and main place of business or post of duty is outside the United States and Puerto Rico on the due date of your return, you are allowed an automatic extension until June 15, to file your return and pay any tax due.

This also applies if you are in military or naval service on duty outside the United States and Puerto Rico.

If you use this automatic extension, you must attach a statement to your return showing that you met the requirements for the extension on the due date of your return. Refer to Topic 304 for more information about extensions.

If you are serving in a combat zone or in a contingency operation (or are hospitalized as a result of an injury received while serving in such an area or operation), you have at least 180 days after you leave the designated combat zone/contingency operation to file and pay taxes.

See Publication 3, Armed Forces' Tax Guide. If you are determined by the Service to be affected by a Presidentially declared disaster or a terroristic or military action, then you may have up to one year after the due date of your return to file and pay taxes, depending on the deadline specified by the Service.

When filing your return, use the peel–off label that is included in your tax package. Check the label to be sure the information is correct. Make any corrections or additions right on the label.

If you did not receive a tax return package with a label, print or type your name, address and social security number in the spaces provided. If you are filing Form 1040EZ (PDF), you must print this information.

Be sure the social security number is the same number listed on your social security card. If you have changed your name you should notify the Social Security Administration or call 1–800–772–1213 before you file your return.

If a joint return is filed, both husband and wife must sign the return. If your spouse cannot sign because of disease or injury and requests that you sign the return, sign your spouse's name in the proper place followed by the word "by" your signature, followed by the word "husband" or "wife".

Be sure to also sign in the space provided for your signature. In addition, you must attach a statement that includes the form number of the return you are filing, the tax year, the reason your spouse cannot sign the return, and that your spouse has agreed to your signing for him or her. If you are the guardian for your spouse who is mentally incompetent, you may sign the return for your spouse, as guardian.

If your spouse cannot sign the return for any other reason, you may sign it only if you are given a valid power of attorney. The document granting you power of attorney should be attached to the return when it is filed. Form 2848 (PDF), Power of Attorney and Declaration of Representative, may be used for this purpose.

If you are filing a return for a minor child who cannot sign the return, sign the child's name followed by the word "by", your signature, and your relationship, such as "parent" or "guardian of minor child".

For information on signing a return for a decedent, refer to Topic 356.

Be sure to attach the Form W-2 (PDF) and the Form 1099-R (PDF) that show Federal income tax withheld to the front of the return. If you are filing Form 1040 (PDF), be sure to attach all related schedules and forms behind your return in order of the sequence number located in the upper right hand corner of the schedule or form.

If you owe tax, make your check or money order payable to the United States Treasury, and enclose it with your return. On the front of your check or money order, please show your name, address, social security number, daytime phone number, the tax year and type of form you are filing (for example, "2005 Form 1040").

Do not mail cash with your return. You can also use a credit card to pay the tax due by calling 1-800-2paytax (1-800-272-9829) or Link2Gov (1-800-729-1040). Refer to your form instructions for more information.

If you cannot pay the amount owed with the return, refer to Topic 201, The Collection Process, for more information.

Mail your return to the address given in the tax form instructions for the area where you live. If possible, use the pre–addressed envelope that came with your booklet. If you are mailing payment or owe tax, follow additional instructions in your tax package.

You may want to file electronically! When you file electronically, you usually receive your refund within 3 weeks after the IRS has received your return, even faster if you have it directly deposited into your checking or savings account.

Many professional tax return preparers offer electronic filing of tax returns in addition to their return preparation services. A fee may be charged. For more information on electronic filing, click on the e-file logo on the home page of irs.gov.

Taxpayer Advocate Service – Help for Problem Situations

The Taxpayer Advocate Service is an independent organization within the IRS whose employees assist taxpayers who are experiencing economic harm, who are seeking help in resolving tax problems that have not been resolved through normal channels, or who believe that an IRS system or procedure is not working as it should.

For example, if you are experiencing financial problems and will be evicted if you don't pay the rent, the Taxpayer Advocate Service may be able to assist you in obtaining your refund expeditiously.

The Taxpayer Advocate Service also may be able to assist you if you have experienced a delay of more than 30 days to resolve a tax-related problem or have not received a response by the date promised. The service is free, confidential, tailored to meet your needs, and available for businesses as well as individuals.

While the Taxpayer Advocate Service cannot change the law or make a technical tax decision, it can clear up problems that resulted from previous contacts and ensure that your case is given a complete and impartial review.

You can contact the Taxpayer Advocate Service by calling its toll–free number 1-877-777-4778, TTY/TTD 1-800-829-4059 to see if you are eligible for assistance.

You can also call or write to your Local Taxpayer Advocate, whose address and phone number are listed in your local telephone directory and in Publication 1546 (PDF), The Taxpayer Advocate Service of the IRS—How to Get Help With Unresolved Tax Problems.

If you write, please be sure to include your social security number or employer identification number, your return address and a phone number where you can be reached during the day. Include with your letter, copies of any correspondence you have received from the IRS.

In addition, please describe your problem, the tax years involved and any previous attempts to solve the problem (including any offices you contacted). You can also file Form 911, Request for Taxpayer Advocate Service Assistance (And Application for Taxpayer Assistance Order), or ask an IRS employee to complete it on your behalf.

To learn more about the Taxpayer Advocate Service, see www.irs.gov/advocate.

Tax Help for Small Businesses and the Self-Employed

If you are starting or already have a small business and need information on taxes, help is available in the form of media products and services.

Publication 3207, The Small Business Resource Guide CD-ROM is a must for every small business owner, or any taxpayer about to start a business. This handy, interactive CD contains all the business tax forms, instructions and publications to successfully manage a business.

In addition, the CD provides a wide variety of web links to various government agencies, business associations and IRS organizations. The improved subscription option feature is your opportunity to join the SB/SE Mail List to receive valuable information that impacts the small business owner.

In addition, the subscription option feature lets small business owners join the SB/SE Mail List to receive valuable information about IRS outreach programs and products.

In addition, please visit our Small Business and Self-Employed Community Web site at www.irs.gov/smallbiz. Our site provides extensive tax information and online tools and resources especially for the small business person.

We offer an array of educational products which you can view or order online, at your convenience, night or day. Additionally, the Web site features an online classroom with video streaming of several of our multimedia educational products.

We also include an ever expanding list of services, such as the online application for your Employer Identification Number and e-filing.

Tax Assistance for Individuals with Disabilities and the Hearing Impaired

Special assistance is available for persons with disabilities. If you are unable to complete your return because of a physical disability, you may obtain assistance from an IRS office, or the Volunteer Income Tax Assistance Program (VITA) sponsored by IRS. For further information on available IRS services, refer to Topic 101 or refer to Publication 910 (PDF), Guide to Free Tax Services.

Telephone assistance for the hearing impaired is available for individuals with TTY equipment. The toll–free number for this service is 1-800-829-4059. Hearing impaired individuals that do not have this equipment may be able to obtain access through the federal or state relay services.

Braille materials for the visually impaired are available at any of the 142 regional libraries in conjunction with the national library service for the blind and physically handicapped.

To locate your nearest library write to the National Library Service for the Blind and Physically Handicapped, Library of Congress at 1291 Taylor Street, NW, Washington, D.C. 20542. Available materials are limited to Publication 17, Your Federal Income Tax, Publication 334, Tax Guide for Small Business, and Forms 1040, 1040A and 1040EZ (materials include instructions and tax tables).

For additional information on these subjects and other areas that may affect persons with disabilities, refer to Publication 907, Tax Highlights for Persons with Disabilities.

Topic 101 - IRS Services – Volunteer Tax Assistance, Toll–Free Telephone, Walk–in Assistance, and Outreach Programs

The IRS sponsors volunteer assistance programs and offers help to taxpayers in many community locations.

The Volunteer Income Tax Assistance Program (VITA) offers free tax help by trained volunteers to low to moderate income taxpayers. VITA sites are locally available at community locations, and provide free basic income tax return preparation to individuals. To see if you qualify, see Publication 910 (PDF), IRS Guide to Free Tax Services, at our website, www.irs.gov. Volunteers prepare Form 1040A (PDF), Form 1040EZ (PDF), and Form 1040 (PDF).

Trained volunteers can help you with special credits, such as Earned Income Tax Credit (EITC), Child Tax Credit and Credit for the Elderly for which you may qualify.

In addition to free tax return preparation assistance, many VITA sites offer free electronic filing (e-file). Individuals taking advantage of the e-file program will receive their refunds in half the time compared to returns filed on paper – even faster if you have your refund deposited directly into your bank account.

Learn the locations, dates, and hours of the volunteer sites, by calling the IRS toll-free at (800) TAX-1040 or (800) 829–1040.

Another program, Tax Counseling for the Elderly (TCE), is a grant program designed to offer free tax assistance to individuals age 60 years or older with low to moderate income. TCE sites are located at convenient community locations.

TCE counselors offer free income tax return preparation services, and can prepare Form 1040, Form 1040A, Form 1040EZ, Form 1040, Schedule A&B (PDF), and simple Form 1040, Schedule D (PDF). The American Association of Retired Persons (AARP), participates in the TCE program.

To locate the nearest AARP office, visit their web site at www.aarp.org/taxaide/home.htm or call 1-888-AARPNOW or (1-888-227-7669). To locate the nearest TCE site call the IRS toll-free at 1-800-TAX-1040 or 1–800–829–1040.

If you plan to take advantage of any of the volunteer assistance programs, be sure to bring photo identification as well as social security cards for you and all your exemptions, your current year's tax package and/or label; all Forms, W-2 and Forms 1099; information for other income; information for all deductions/credits; and a copy of last year's tax return, amounts paid for day care, and bank routing numbers if your are expecting a refund and choose direct deposit.

You can get free telephone assistance by calling 1-800-829-1040. When calling this number, you may ask questions to help you prepare your return, or ask about a notice you have received. In certain areas, IRS has local offices you may visit to receive assistance.

The Community Outreach Tax Education Program offers free tax seminars to groups of people sharing common tax interests. IRS employees or trained volunteers conduct tax information seminars at convenient times and places in the community.

The seminars cover a variety of topics tailored to the needs of your organization's members and include films or videotapes and discussion of tax questions.

For information on VITA, TCE, and Community Outreach locations and times, or to volunteer for any of these programs, call 1–800–829–1040.

Armed Forces Tax Information

The tax laws provide some special benefits for active members of the U.S. Armed Forces and certain benefits for individuals serving in combat zones.

For more information on the various tax benefits available to members of the U.S. Armed Forces, please refer to Publication 3, Armed Forces' Tax Guide.

For federal tax purposes, the U.S. Armed Forces includes commissioned officers, warrant officers, and enlisted personnel in all regular and reserve units controlled by the Secretaries of Defense, the Army, Navy, and Air Force.

The Coast Guard is also included, but not the U.S. Merchant Marine or the American Red Cross. However, these and other support personnel serving in a combat zone may qualify for certain tax deadline extensions normally available to individuals in the U.S.

Armed Forces serving in a combat zone. For more information on benefits available to individuals serving in a combat zone, please refer to Publication 3, Armed Forces' Tax Guide, or go to Questions and Answers on Combat Zone Tax Provisions at the www.irs.gov web site.

Bad Debt Deduction

If someone owes you money that you cannot collect, you may have a bad debt. For a discussion of what constitutes a valid debt, refer to Publication 550, Investment Income and Expenses, and Publication 535, Business Expense. To deduct a bad debt, you must have previously included the amount in your income or loaned out your cash. If you are a cash basis taxpayer, as most individuals are, you may not take a bad debt deduction for income you expected to receive but did not because the amount was never included in your income. For a bad debt, you must show that there was an intention at the time of the transaction to make a loan and not a gift.

There are two kinds of bad debts – business and nonbusiness. A business bad debt, generally, is one that comes from operating your trade or business. A business deducts its bad debts from gross income when figuring its taxable income. Business bad debts may be deducted in part or in full.

All other bad debts are nonbusiness. Nonbusiness bad debts must be totally worthless to be deductible. You cannot deduct a partially worthless nonbusiness bad debt. You must establish that you have taken reasonable steps to collect the debt and the debt is worthless. It is not necessary to go to court if you can show that a judgment from the court would be uncollectible. You may take the deduction only in the year the debt becomes worthless. A debt becomes worthless when the surrounding facts and circumstances indicate there is no longer any chance the amount owed will be paid. You do not have to wait until a debt is due to determine whether it is worthless.

A nonbusiness bad debt is reported as a short–term capital loss in Part 1 on Form 1040, Schedule D (PDF). It would be subject to the capital loss limitations. A nonbusiness bad debt deduction requires a separate detailed statement attached to your return.

For more information on nonbusiness bad debts, refer to Publication 550, Investment Income and Expenses. For more information on business bad debts, refer to Publication 535, Business Expenses.

Student Loan Interest Deduction

You may be able to deduct interest you pay on a qualified student loan. And, if your student loan is canceled, you may not have to include any amount in income.

The deduction is claimed as an adjustment to income so you do not need to itemize your deductions on Schedule A Form 1040.

You can claim the deduction if all of the following apply:

1. You paid interest on a qualified student loan in tax year 2007

2. Your filing status is not married filing separately

3. Your modified adjusted gross income is less than $65,000 ($135,000 if filing jointly)

4. You and your spouse, if filing jointly, cannot be claimed as dependents on someone else's return

A qualified student loan is a loan you took out solely to pay qualified higher education expenses. See the instructions for Form 1040 to determine if your expenses qualify.

If you file a Form 2555, Form 2555EZ or Form 4563, use Publication 970 instead of the worksheet in the Form 1040 Instructions.

The deduction will start to phase out when the modified AGI exceeds certain amounts. To determine when the deduction is phased out, please refer to Publication 970, Tax Benefits for Education.

If you paid $600 or more of interest on a qualified student loan during the year, you will receive a Form 1098-E (PDF), Student Loan Interest Statement, from the entity to which you paid the student loan interest.

Tuition And Fees Deduction

You may be able to deduct qualified tuition and related expenses that you pay for yourself, your spouse, or a dependent, as a tuition and fees deduction. To determine whether your expenses are qualified, refer to Publication 970, Tax Benefits for Education.

You do not have to itemize to take this deduction. You can claim qualified tuition and fees as either: (1) an adjustment to income, as directed above; or (2) a Hope or Lifetime Learning credit, or (3) if applicable, as business expenses.

You cannot take the tuition and fees deduction on your income tax return if your filling status is married filing separately, or if you are claimed as a dependent on someone else's return.

The deduction is reduced or eliminated if your modified adjusted gross income exceeds certain limits, based on your filing status. You cannot claim the tuition and fees deduction and a Hope or Lifetime Learning credit for the same student.

If the educational expenses are also allowable as a business expense, the tuition and fees deduction may be claimed in conjunction with a business expense deduction, but the same expenses cannot be deducted twice.

You cannot claim a deduction or credit based on expenses paid with tax-free scholarship, fellowship, grant, or education savings account funds such as a Coverdell education savings account, tax-free savings bond interest or employer-provided education assistance.

The same rule applies to expenses you pay with a tax-exempt distribution from a qualified tuition plan, except that you can deduct qualified expenses you pay only with that part of the distribution that is a return of your contribution to the plan.

Educator Expense Deduction

If you are an eligible educator, you can deduct up to $250 of your unreimbursed expenses [otherwise deductible trade or business expenses] you paid or incurred for books, supplies, computer equipment (including related software and services), other equipment, and supplementary materials that you use in the classroom.

For courses in health and physical education, expenses for supplies are qualified expenses only if they are related to athletics. You can deduct these expenses even if you do not itemize deductions on Form 1040, Schedule A.

This deduction is for expenses paid or incurred during the tax year. Previously, these expenses were deductible only as a miscellaneous itemized deduction subject to the 2% of adjusted gross income limit. The deduction is claimed on line 23 of Form 1040.

You are an eligible educator if, for the tax year, you meet the following requirements:

You are a kindergarten through grade 12;

Teacher

Instructor

Counselor

Principal, or

Aide

You work at least 900 hours a school year in a school that provides elementary or secondary education, as determined under state law.

Qualified expenses are deductible only to the extent the amount of such expenses exceeds the following amounts for the tax year:

The interest on qualified U.S. savings bonds that you excluded from income because you paid qualified higher education expenses,

Any distribution from a qualified tuition program that you excluded from income, or

Any tax-free withdrawals from your Coverdell Education Savings Account.

For additional information regarding personal credits and any alternative minimum tax (AMT), refer to Publication 17, Your Federal Income Tax.

Moving Expenses

If you moved due to a change in your job or business because you started a new job, you may be able to deduct your moving expenses. To qualify for the moving expense deduction, you must satisfy two tests.

Under the first test, the "distance test", your new job must be at least 50 miles farther from your old home than your old job location was from your old home.

If you had no previous workplace, your new job must be at least 50 miles from your old home, or if you are a member of the armed forces and your move was due to a permanent change of station you also may qualify.

The second test is the "time test". If you are an employee, you must work full-time for at least 39 weeks during the 12 months right after starting your new job.

If you are self-employed, you must work full time for at least 39 weeks during the first 12 months and for a total of at least 78 weeks during the first 24 months after starting your new job.

There are exceptions to the time test in case of death, disability and involuntary separation, among other things. For more information on qualifying to deduct moving expenses please refer to Publication 521, Moving Expenses.

Moving expenses are figured on Form 3903 (PDF) and deducted as an adjustment to income on Form 1040 (PDF). You cannot deduct any moving expenses that were reimbursed by your employer.

For additional information, refer to the Form 3903 (PDF) Instructions and Publication 521, Moving Expenses.

Alimony Paid

You may deduct the alimony or separate maintenance payments you are required to make, and you must include in income the alimony or separate maintenance payments you receive.

This topic covers alimony under divorce or separate maintenance decrees or written separation agreements entered into by you and your spouse/former spouse after 1984. It explains what is deductible if you pay alimony, and what is taxable if you receive alimony.

Alimony payments you make under a divorce or separation instrument are deductible if all of the following requirements are met:

1. You and your spouse or former spouse do not file a joint return with each other, 2. You pay in cash (including checks or money orders),

3. The divorce or separation instrument does not say that the payment is not alimony,

4. If legally separated under a decree of divorce or separate maintenance, you and your former spouse are not members of the same household when you make the payment,

5. You have no liability to make any payment (in cash or property) after the death of your spouse or former spouse; and

6. Your payment is not treated as child support.

Child support is never deductible. If your divorce decree or other written instrument or agreement calls for alimony and child support, and you pay less than the total required, the payments apply first to child support. Any remaining amount is considered alimony.

Noncash property settlements, whether in a lump sum or installments, do not qualify as alimony. Voluntary payments (i.e., payments not required by a divorce decree or separation instrument) do not qualify as alimony.

You do not have to itemize deductions to deduct your alimony payments. You must claim the deduction on Form 1040 (PDF). You cannot use Form 1040A or Form 1040EZ.

You must provide the social security number of the spouse or former spouse receiving the payments. If you don't, you may have to pay a $50 penalty and your deduction may be disallowed.

If you are the spouse or former spouse who is receiving the alimony, you must report the full amount as income on your Form 1040. You cannot use Form 1040A or Form 1040EZ. If you do not give your social security number to your spouse or former spouse who is making the alimony payments, you may have to pay a $50 penalty.

More information on alimony, including rules for divorces and separations before 1985 and recapture rules, is available in Publication 504, Divorced or Separated Individuals.

Individual Retirement Arrangements (IRAs)

An individual retirement arrangement, or IRA, is a personal savings plan which allows you to set aside money for retirement, while offering you tax advantages.

You may be able to deduct some or all of your contributions to your IRA. Amounts in your IRA, including earnings, generally are not taxed until distributed to you.

IRA's cannot be owned jointly. However, any amounts remaining in your IRA upon your death can be paid to your beneficiary or beneficiaries.

To contribute to a traditional IRA, you must be under age 70 1/2 at the end of the tax year. You, and/or your spouse if you file a joint return, must have taxable compensation, such as wages, salaries, commissions, tips, bonuses, or net income from self–employment.

Taxable alimony and separate maintenance payments received by an individual are treated as compensation for IRA purposes.

Compensation does not include earnings and profits from property, such as rental income, interest and dividend income or any amount received as pension or annuity income, or as deferred compensation.

Please refer to Publication 590 for information on the amounts you will be eligible to contribute to your IRA account.

Figure your deduction using the worksheets in the Form 1040 Instructions or Form 1040A Instructions or in Publication 590. You cannot claim an IRA deduction on Form 1040EZ; you must use either Form 1040A (PDF) or Form 1040 (PDF). Form 8606 (PDF) should be attached to your return.

The deadline for contributions to a traditional IRA for the year is the due date of your return, not including any extensions of time to file.

Amounts you withdraw from your IRA are fully or partially taxable in the year you withdraw them. If you made only deductible contributions, withdrawals are fully taxable. Use Form 8606 to figure the taxable portion of withdrawals.

Withdrawals made prior to age 59 1/2 may be subject to a 10% additional tax. You also may owe an excise tax if you do not begin to withdraw minimum distributions by April 1st of the year after you reach age 70 1/2.

These additional taxes are figured and reported on Form 5329 (PDF). Refer to Form 5329 Instructions for exceptions to the additional taxes. For information on Roth IRA contributions or distributions, refer to Topic 309.

For information on conversions from a traditional IRA to a Roth IRA, refer to Publication 590.

Wages and Salaries

Wages, salaries, and tips received by an employee for performing services for an employer must be included in your gross income. Amounts withheld from pay for income tax, social security and Medicare taxes, pensions, insurance, and union dues are considered "received" and must be included in gross income in the year they are withheld.

Generally, your employer's contribution to a qualified pension plan for you is not included in gross income at the time it is contributed. However, amounts withheld under certain salary reduction agreements with your employer may have to be included in gross income in the year they are withheld. See Publication 17, Chapter 5, Wages Salaries and Other Earnings, and Chapter 6, Tip Income, for specific information.

Your employer should provide a Form W-2 (PDF) showing your total income and withholding. You must include all wages and withholding's from all Forms W-2 if you received more than one and if filing jointly all of your spouses Forms W-2. Attach a copy of each W–2 to the front of your tax return as indicated in the instructions. Please note that Form 1099-MISC (PDF) generally reports self-employment income.

NOTE: Topic 407 provides information on Business Income.

File an amended tax return, Form 1040X (PDF), if you receive a Form W-2 after your return is filed. Topic 308 provides information on amended returns.

Refer to Topic 154, Forms W-2 and Form 1099–R (What To Do If Not Received), if you have not received one or more Forms W–2 by early February.

For more information on tips, refer to Publication 531, Reporting Tip Income. Publication 1244, which contains Form 4070A, Employee's Daily Record of Tips to Employer, and Form 4070, Employee's Report of Tips to Employer, should also be helpful to you.

More On Casualty, Disaster, and Theft Losses

If your business or income-producing property is completely destroyed, the decrease in fair market value is not considered. Your loss is the adjusted basis of the property, minus any salvage value and any insurance or other reimbursement you receive or expect to receive. For more information on determining adjusted basis, see Publication 551, Basis of Assets.

In figuring your loss, do not consider the loss of future profits or income due to the casualty.

Casualty losses are claimed on Form 4684 (PDF), Casualties and Thefts. Section A is used for personal–use property and Section B is used for business or income-producing property. If personal-use property was destroyed or stolen, you may wish to refer to Publication 584B (PDF), Business Casualty, Disaster, and Theft Loss Workbook.

Casualty losses are generally deductible only in the year the casualty occurred. However, if you have a deductible loss from a disaster in a Presidentially declared disaster area, you can choose to deduct that loss on your tax return for the year immediately preceding the year of the casualty. If you have already filed your return for the preceding year, the loss may be claimed in the preceding year by filing an amended return, ( Form 1040X (PDF) for Individuals or Form 1120X (PDF) for Corporations).

Generally, you must make the choice to use the preceding year by the due date of the current year's return, without extensions.

For Example:

The election to deduct a 2005 disaster loss on your 2004 return must be made on or before the due date (without extensions) of the 2005 return.

You can revoke this choice within 90 days after making it by returning to the IRS any refund or credit you received from making the choice. If you revoke your choice before receiving a refund, you must return the refund within 30 days after receiving it for the revocation to be effective.

Generally, you can choose to postpone reporting gain due to insurance proceeds that exceed your basis in property destroyed or damaged by a casualty if you purchase replacement property or repair the damage within two years. Postponement of gain is only available if the amount you spend on replacing or repairing your property is equal to, or exceeds, the insurance proceeds you receive. Otherwise, the excess of the insurance proceeds over the amount you spend to replace or repair your property must be reported as gain.

If your main home, or any of its contents, is damaged or destroyed as a result of a disaster in a Presidentially declared disaster area, do not report any gain due to insurance proceeds you receive for unscheduled personal property, such as damaged furniture, that was part of the contents of your home. You can choose to postpone gain from any other insurance proceeds received for your main home or its contents if you purchase replacement property within four years after the close of the first tax year in which any gain is realized. For this purpose, insurance proceeds received for the home or its contents are treated as being received for a single item of property, and any replacement property you purchase that is similar or related in service or use to your home or its contents is treated as similar or related in service or use to that single item of property. Again, postponement of gain is only available if the amount you spend on replacing or repairing your property is equal to, or exceeds, the insurance proceeds you receive. Otherwise, you must recognize gain to the extent that the insurance proceeds are more than the cost of your replacement property. Renters qualify to choose relief under these rules if the rented residence is their main home.

If your home is located in a Presidentially declared disaster area and your state or local government orders you to tear it down or move it because it is no longer safe to live in, the resulting loss in value is treated as a casualty loss from a disaster. Figure your loss in the same way as any other casualty loss of personal-use property. The State or local government order must be issued within 120 days after the area is declared a disaster area.

If your loss deduction is more than your income, you may have a net operating loss. You do not have to be in business to have a net operating loss from a casualty. For more information, refer to Publication 536, Net Operating Losses.

The IRS may postpone for up to one year certain tax deadlines of taxpayers who are affected by a Presidentially declared disaster. The tax deadlines the IRS may postpone include those for filing income, estate, gift, generation-skipping transfer, certain excise, and employment tax returns, paying taxes associated with those returns, and making contributions to a traditional IRA or Roth IRA.

If the IRS postpones the due date for filing your return and for paying your tax and you are affected by a Presidentially declared disaster area, the IRS may abate the interest on underpaid tax that would otherwise accrue for the period of the postponement.

Casualty, Disaster, and Theft Losses

A casualty loss can result from the damage, destruction or loss of your property from any sudden, unexpected, and unusual event such as a flood, hurricane, tornado, fire, earthquake or even volcanic eruption.

If your property is not completely destroyed, or if it is personal-use property, determine your loss from a casualty by first figuring the decrease in fair market value of your property as a result of the casualty event.

To determine the fair market value of your property, refer to Topic 703. Keep in mind the general definition of fair market value is the price at which property would change hands between a buyer and seller, neither having to buy or sell, and both having reasonable knowledge of all necessary facts.

If the property was held by you for personal use, you must further reduce your loss by $100. This $100 reduction for losses of personal-use property applies to each casualty or theft event that occurred during the year.

The total of all your casualty and theft losses of personal-use property must be further reduced by 10% of your adjusted gross income.

For more information regarding casualty losses of personal-use property and how to deduct them, refer to Topic 507 and Publication 547, Casualties, Disasters, and Thefts.

I am in a disaster area and heard the IRS could help me. What can the IRS do?

If you have been affected by a Presidentially declared disaster, the IRS may help you by allowing additional time for filing returns and making payments, and in some circumstances, waiving penalties if the disaster has caused you to file or pay late.

The IRS may also, provide copies or transcripts of previously filed returns, free of charge. You may be eligible to file for a casualty loss deduction on the prior year's tax return, or if you have already filed, by amended return (Form 1040X).

For additional information on this subject, refer to Tax Topic 515, Casualty, Disaster, and Theft Losses, and Publication 547, Casualties, Disasters, and Theft.

My spouse and I are filing separate returns. How can we split our itemized deductions?

If you and your spouse file separate returns and one of you itemizes deductions, the other spouse will have a standard deduction of zero. Therefore, the other spouse should also itemize deductions.

You may be able to claim itemized deductions on a separate return for certain expenses that you paid separately or jointly with your spouse. Deductible expenses that are paid out of separate funds, such as medical expenses, are deductible by the spouse who pays them.

If these expenses are paid from community funds, the deduction may depend on whether or not you live in a community property state. In a community property state, the deduction is, generally, divided equally between you and your spouse.

For more information refer to Publication 504, Divorced or Separated Individuals; and Publication 555, Community Property.

Home Mortgage Points

The term "points" is used to describe certain charges paid to obtain a home mortgage. Points may be deductible as home mortgage interest, if you itemize deductions on Form 1040, Schedule A (PDF). If you can deduct all of the interest on your mortgages, you may be able to deduct all of the points paid on the mortgage. For more information on deducting interest, refer to Topic 505.

You can deduct the points in full in the year they are paid, if all the following requirements are met:

1. Your loan is secured by your main home (your main home is the one you live in most of the time).

2. Paying points is an established business practice in your area.

3. The points paid were not more than the amount generally charged in that area.

4. You use the cash method of accounting. This means you report income in the year you receive it and deduct expenses in the year you pay them.

5. The points were not paid for items that usually are separately stated on the settlement sheet such as appraisal fees, inspection fees, title fees, attorney fees, or property taxes.

6. The funds you provided at or before closing, plus any points the seller paid, were at least as much as the points charged. You cannot have borrowed the funds from your lender or mortgage broker in order to pay the points.

7. You use your loan to buy or build your main home.

8. The points were computed as a percentage of the principal amount of the mortgage, and

9. The amount is clearly shown on your settlement statement.

Points that do not meet these requirements may be deductible over the life of the loan. Points paid for refinancing generally can only be deducted over the life of the new mortgage.

However, if you use part of the refinanced mortgage proceeds to improve your main home and you meet the first six requirements stated previously, you can fully deduct the part of the points related to the improvement in the year you paid them with your own funds. Points charged for specific services, such as preparation costs for a mortgage note, appraisal fees or notary fees are not interest and cannot be deducted.

Points paid by the seller of a home cannot be deducted as interest on the seller's return, but they are a selling expense which will reduce the amount of gain realized. Points paid by the seller may be deducted by the buyer provided the buyer subtracts the amount from the basis, or cost, of the residence. Points you pay on loans secured by your second home can be deducted only over the life of the loan.

You may be subject to a limit on some of your itemized deductions, including points; for more information on the adjusted gross income limitations please refer to the Form 1040 Instructions.

For more information on points, refer to Publication 936, Home Mortgage Interest Deduction.

If I must deduct points over the life of my mortgage, and I have a 30 year mortgage, does this mean that I divide the points paid by 30 and enter that amount on Schedule A?

No, you don't divide the points by 30. If you choose to use the straight-line method, you need to divide the points by the number of payments over the term of the loan and deduct points for a year according to the number of payments made in the year.

If the loan ends prematurely, due to payoff or refinance with a different lender, for example, then the remaining points are deducted in that year.

Points not included in Form 1098 (PDF) (usually not included on a refinance) should be entered on Form 1040, Schedule A (PDF), Itemized Deductions. For more information, refer to Publication 936, Home Mortgage Interest Deduction; and Tax Topic 504, Home Mortgage Points.

Is the mortgage interest and property tax on a second residence deductible?

The mortgage interest on a second home which you use as a residence for some portion of the taxable year, is generally deductible if the interest satisfies the same requirements for deductibility as interest on a primary residence.

Real estate taxes paid on your primary and second residence are, generally, deductible. Deductible real estate taxes include any state, local, or foreign taxes on real property levied for the general public welfare.

Deductible real estate taxes do not include taxes charged for local benefits and improvements that increase the value of the property. For more information, refer to Publication 17, Your Federal Income Tax for Individuals, Chapter 24; Tax Topic 503, Deductible Taxes; and Publication 530, Tax Information for First-Time Home Owners.

Our home was seriously damaged by flooding last year. Are there special provisions for claiming a loss since our home is located in a declared disaster area?

Casualty losses not compensated for by insurance or otherwise are generally deductible only in the year the casualty occurred. However, if you have a deductible loss from a disaster in an area that is officially designated by the President of the United States as eligible for federal disaster assistance, you can choose to deduct that loss on your return for the year immediately preceding the loss year.

In other words, you may treat the loss as having occurred in either the current year or the previous year, whichever provides the best tax results for you.

If you have already filed your return for the preceding year, the loss may be claimed by filing an amended return, Form 1040X (PDF), Amended U.S. Individual Income Tax Return.

For more information on disaster area losses (including flood losses), refer to Tax Topic 515, Disaster Area Losses (Including Flood Losses), or Publication 547, Casualties, Disasters and Thefts. Publication 584, Casualty, Disaster, and Theft Loss Workbook, can be used to help you catalog your property.

Home mortgage interest is interest you pay on a loan secured by your main home or a second home. The loan may be a mortgage to buy your home, a second mortgage, a home equity loan, or a line of credit.

Your main home is where you live most of the time. It can be a house, cooperative apartment, condominium, mobile home, house trailer, or houseboat that has sleeping, cooking and toilet facilities.

A second home can include any other residence you own, and treat as a second home. You do not have to use the home during the year. However, if you rent it to others, you must also use it as a home during the year for more than the greater of 14 days or 10 percent of the number of days you rent it, for the interest to qualify as home mortgage interest.

Home mortgage interest and points are generally reported to you on Form 1098 (PDF), Mortgage Interest Statement, by the financial institution to which you made the payments.

If all of your mortgages fit into one or more of the following three categories at all times during the year, you can deduct all of the interest on these mortgages:

1. A mortgage you took out on or before October 13, 1987 (grandfathered debt.) 2. Mortgages taken out after October 13, 1987, to buy, build, or improve your home, (called home acquisition debt) but only if this debt plus any grandfathered debt totals $1 million or less throughout 2007. The limit is $500,000 if you are married filing separately.

3. Any mortgages taken out after October 13, 1987, other than to buy, build, or improve your home (called home equity debt), but only if these mortgages total $100,000 or less throughout 2007, and all mortgages, including any grandfathered debt and home acquisition debt, on the home, total no more than your homes fair market value. The limit is $50,000 if you are married filing separately.

If one or more of your mortgages does not fit into any of these categories, refer to Publication 936, Home Mortgage Interest Deduction, to figure the amount of interest you can deduct.

You may be able to take a credit against your federal income tax if you were issued a mortgage credit certificate by a state or local government for low income housing. Use Form 8396 (PDF), Mortgage Interest Credit, to figure the amount. For further information, please refer to Publication 530, Tax Information for First Time Homeowners.

You cannot deduct personal interest. Personal interest includes interest paid on a loan to purchase a car for personal use, credit card and installment interest incurred for personal expenses. Items you cannot deduct as interest include points (if you are a seller), service charges, credit investigation fees, and interest relating to tax–exempt income, such as interest to purchase or carry tax–exempt securities.

You may be subject to a limit (phaseout) on some of your itemized deductions including mortgage interest. For more information on the limitations based on the adjusted gross income please refer to the Form 1040 Instructions.

Interest Expense

Interest is an amount you pay for the use of borrowed money. To deduct interest you paid on a debt you must be legally liable for the debt.

Additionally, you generally must itemize your deductions, unless the interest is on rental or business property or on a student loan.

If you prepay interest, you must allocate the interest over the tax years to which it applies. You may deduct in each year only the interest that applies to that year.

However, there is an exception that applies to points paid on a principal residence.

The types of interest you can deduct as itemized deductions on Form 1040, Schedule A (PDF) are investment interest and home mortgage interest, including certain points. For information on points, refer to Topic 504 .

You can deduct student loan interest on Form 1040 (PDF) or Form 1040A (PDF). For information on deducting student loan interest, refer to Topic 456.

I took out a home equity loan to pay off personal debts. Is this interest deductible? Where do I enter this amount on my tax return?

A loan taken out for reasons other than to buy, build, or substantially improve your home, such as to pay off personal debts may qualify as home equity debt.

The interest would be deducted on Form 1040, Schedule A (PDF), Itemized Deductions. The amount you can deduct as interest on home equity debt is subject to certain limitations. For more information, refer to Publication 936, Home Mortgage Interest Deduction; and Tax Topic 505, Interest Expense.

I have a mortgage for my primary residence and a second mortgage for land that I intend to build a home on. Can the interest be deducted for the second mortgage?

Unless you have begun construction of a home on the bare land that you can occupy within 24 months the interest you paid on the second mortgage would not qualify as deductible mortgage interest. . For more information, refer to Publication 936, Home Mortgage Interest Deduction.

My father is in a nursing home and I pay for the entire cost. Can I deduct the expenses on my tax return?

Nursing home expenses are allowable as medical expenses in certain instances. If you, your spouse, or your dependent is in a nursing home, and the primary reason for being there is for medical care, the entire cost, including meals and lodging, is a medical expense.

If the individual is in the home mainly for personal reasons, then only the cost of the actual medical care is a medical expense, and the cost of the meals and lodging is not deductible.

To determine if your father qualifies as your dependent for this purpose, refer to Publication 502, Medical and Dental Expenses.

You deduct medical expenses on Form 1040, Schedule A (PDF), Itemized Deductions. The total of all allowable medical expenses must be reduced by 7.5% of your Adjusted Gross Income.

Can I deduct alimony paid to my former spouse?

If you are divorced or separated, you may be able to deduct the alimony or separate maintenance payments that you are required to make to your spouse or former spouse, or on behalf of that spouse.

For additional information, refer to Tax Topic 452, Alimony Paid (this topic covers alimony under decrees or agreements after 1984); and Publication 504, Divorced or Separated Individuals.

Alimony Paid

You may deduct the alimony or separate maintenance payments you are required to make, and you must include in income the alimony or separate maintenance payments you receive.

This topic covers alimony under divorce or separate maintenance decrees or written separation agreements entered into by you and your spouse/former spouse after 1984. It explains what is deductible if you pay alimony, and what is taxable if you receive alimony.

Alimony payments you make under a divorce or separation instrument are deductible if all of the following requirements are met:

1. You and your spouse or former spouse do not file a joint return with each other,

2. You pay in cash (including checks or money orders),

3. The divorce or separation instrument does not say that the payment is not alimony,

4. If legally separated under a decree of divorce or separate maintenance, you and your former spouse are not members of the same household when you make the payment,

5. You have no liability to make any payment (in cash or property) after the death of your spouse or former spouse; and

6. Your payment is not treated as child support.

Child support is never deductible. If your divorce decree or other written instrument or agreement calls for alimony and child support, and you pay less than the total required, the payments apply first to child support. Any remaining amount is considered alimony.

Noncash property settlements, whether in a lump sum or installments, do not qualify as alimony. Voluntary payments (i.e., payments not required by a divorce decree or separation instrument) do not qualify as alimony.

You do not have to itemize deductions to deduct your alimony payments. You must claim the deduction on Form 1040 (PDF). You cannot use Form 1040A or Form 1040EZ.

You must provide the social security number of the spouse or former spouse receiving the payments. If you don't, you may have to pay a $50 penalty and your deduction may be disallowed.

If you are the spouse or former spouse who is receiving the alimony, you must report the full amount as income on your Form 1040.

You cannot use Form 1040A or Form 1040EZ. If you do not give your social security number to your spouse or former spouse who is making the alimony payments, you may have to pay a $50 penalty.

More information on alimony, including rules for divorces and separations before 1985 and recapture rules, is available in Publication 504, Divorced or Separated Individuals.

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You will need Adobe Reader (the latest version is recommended) installed on your computer in order to open and read this ebook. You can get Adobe Reader here (a new window will open so you can download it without leaving this page).

If you want to open the file in your browser window, just click on the link. However, if you want to download the file to view later, then right-click on the link and choose "Save Target As" if you are using Internet Explorer or "Save Link As" if you are using Mozilla. Some Browsers use "Save File as" Then select where you want to save the file on your hard drive.

Once you have saved the file, locate where you saved it, and double click to open.

One of the main features is an outline of a plan for getting 25 to 30 year olds elected to congress.

This is in no way an endorsement of Ron Paul. It is to show that a 25 year old with the same message of bringing the "federal monster" under control could raise enough money for a successful campaign.

JFK is featured quite prominently is this Ebook. His tax cuts gave us one of the best economies in the history of America.

You should find his economic philosophy both informative and illuminating; it is quite the opposite of today's diseased class warfare/class envy.

Interest Expense

Interest is an amount you pay for the use of borrowed money. To deduct interest you paid on a debt you must be legally liable for the debt. Additionally, you generally must itemize your deductions, unless the interest is on rental or business property or on a student loan.

If you prepay interest, you must allocate the interest over the tax years to which it applies. You may deduct in each year only the interest that applies to that year. However, there is an exception that applies to points paid on a principal residence.

The types of interest you can deduct as itemized deductions on Form 1040, Schedule A (PDF) are investment interest and home mortgage interest, including certain points. For information on points, refer to Topic 504 .

You can deduct student loan interest on Form 1040 (PDF) or Form 1040A (PDF). For information on deducting student loan interest, refer to Topic 456.

Home mortgage interest is interest you pay on a loan secured by your main home or a second home. The loan may be a mortgage to buy your home, a second mortgage, a home equity loan, or a line of credit.

Your main home is where you live most of the time. It can be a house, cooperative apartment, condominium, mobile home, house trailer, or houseboat that has sleeping, cooking and toilet facilities.

A second home can include any other residence you own, and treat as a second home. You do not have to use the home during the year. However, if you rent it to others, you must also use it as a home during the year for more than the greater of 14 days or 10 percent of the number of days you rent it, for the interest to qualify as home mortgage interest.

Home mortgage interest and points are generally reported to you on Form 1098 (PDF), Mortgage Interest Statement, by the financial institution to which you made the payments.

If all of your mortgages fit into one or more of the following three categories at all times during the year, you can deduct all of the interest on these mortgages:

1. A mortgage you took out on or before October 13, 1987 (grandfathered debt.)

2. Mortgages taken out after October 13, 1987, to buy, build, or improve your home, (called home acquisition debt) but only if this debt plus any grandfathered debt totals $1 million or less throughout 2007. The limit is $500,000 if you are married filing separately.

3. Any mortgages taken out after October 13, 1987, other than to buy, build, or improve your home (called home equity debt), but only if these mortgages total $100,000 or less throughout 2007, and all mortgages, including any grandfathered debt and home acquisition debt, on the home, total no more than your homes fair market value. The limit is $50,000 if you are married filing separately.

If one or more of your mortgages does not fit into any of these categories, refer to Publication 936, Home Mortgage Interest Deduction, to figure the amount of interest you can deduct.

You may be able to take a credit against your federal income tax if you were issued a mortgage credit certificate by a state or local government for low income housing. Use Form 8396 (PDF), Mortgage Interest Credit, to figure the amount. For further information, please refer to Publication 530, Tax Information for First Time Homeowners.

You cannot deduct personal interest. Personal interest includes interest paid on a loan to purchase a car for personal use, credit card and installment interest incurred for personal expenses. Items you cannot deduct as interest include points (if you are a seller), service charges, credit investigation fees, and interest relating to tax–exempt income, such as interest to purchase or carry tax–exempt securities.

You may be subject to a limit (phaseout) on some of your itemized deductions including mortgage interest. For more information on the limitations based on the adjusted gross income please refer to the Form 1040 Instructions.

NOTICE:

Interest and penalties paid to the IRS on Federal taxes are not deductible. For more information, refer to Items You Cannot Deduct in Chapter 25, Interest Expense, in Publication 17, Your Federal Income Tax for Individuals; and Tax Topic 505, Interest Expense.

I donated a used car to a qualified charity. I itemize my deductions, and I would like to take a charitable contribution for the donation. Do I need to attach any special forms to my return? What records do I need to keep?

If you claim a deduction on your return of over $500 for all contributed property, you must attach a Form 8283 (PDF), Noncash Charitable Contributions, to your return.

If you claim a total deduction of $5,000 or less for all contributed property, you need only complete Section A of Form 8283 (PDF).

If you claim a deduction of more than $5,000 for an item or a group of similar items, you generally need to complete Section B of Form 8283 (PDF) which requires, in most cases, an appraisal by a qualified appraiser.

You will need to obtain and keep evidence of your car donation and be able to substantiate the fair market value of the car. If you are claiming a deduction of $250 or more for the car donation, you will also need a contemporaneous written acknowledgement from the charity that includes a description of the car and a statement of whether the charity provided any goods or services in return for the car and, if so, a description and estimate of the fair market value of the goods or services.

For more information on these requirements, refer to Publication 526, Charitable Contributions; Publication 561, Determining the Value of Donated Property; Form 8283, Noncash Charitable Contributions, and its instructions.

Last year, my parents took out a student loan for me in their name and I also took out a student loan. My parents received Form 1098-E for their loan and I also received Form 1098-E for my loan. Can we both claim the interest from the loans on our tax returns? Last year, I was not their dependent.

In order for a taxpayer to claim a deduction for student loan interest, the loan must be incurred for the taxpayer, the taxpayer's spouse, or a person who was the taxpayer's dependent when the taxpayer took out the loan.

Since you were not your parents' dependent when they took out the student loan, the interest they paid on the loan does not qualify for deduction. However, the student loan interest payments you made on the student loan you took out on your behalf are eligible for deduction, provided all the other requirements are met.

For more information, refer to Publication 970, Tax Benefits for Education, Chapter 4; Tax Topic 505, Interest Expense; and Tax Topic 513, Educational Expenses.

Right-click to download Real World Economics: For High School Seniors, College Students and New Entrants To The Workforce.

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You will need Adobe Reader (the latest version is recommended) installed on your computer in order to open and read this ebook. You can get Adobe Reader here (a new window will open so you can download it without leaving this page).

If you want to open the file in your browser window, just click on the link. However, if you want to download the file to view later, then right-click on the link and choose "Save Target As" if you are using Internet Explorer or "Save Link As" if you are using Mozilla. Some Browsers use "Save File as" Then select where you want to save the file on your hard drive.

Once you have saved the file, locate where you saved it, and double click to open.

One of the main features is an outline of a plan for getting 25 to 30 year olds elected to congress.

This is in no way an endorsement of Ron Paul. It is to show that a 25 year old with the same message of bringing the "federal monster" under control could raise enough money for a successful campaign.

JFK is featured quite prominently is this Ebook. His tax cuts gave us one of the best economies in the history of America.

You should find his economic philosophy both informative and illuminating; it is quite the opposite of today's diseased class warfare/class envy.

What are the limits for deducting interest paid on a student loan?

The maximum deductible interest on a qualified student loan is $2,500 per return.

There is no deduction if you file as married filing separately, if you are claimed as a dependent, or if the loan is from a related party or a qualified employer plan. There are limits based on your filing status and adjusted gross income. For more information, refer to Publication 970, Tax Benefits for Education, and Tax Topic 513, Educational Expenses.

Right-click to download Real World Economics: For High School Seniors, College Students and New Entrants To The Workforce.

It's Free-It's Instant

You will need Adobe Reader (the latest version is recommended) installed on your computer in order to open and read this ebook. You can get Adobe Reader here (a new window will open so you can download it without leaving this page).

If you want to open the file in your browser window, just click on the link. However, if you want to download the file to view later, then right-click on the link and choose "Save Target As" if you are using Internet Explorer or "Save Link As" if you are using Mozilla. Some Browsers use "Save File as" Then select where you want to save the file on your hard drive.

Once you have saved the file, locate where you saved it, and double click to open.

One of the main features is an outline of a plan for getting 25 to 30 year olds elected to congress.

This is in no way an endorsement of Ron Paul. It is to show that a 25 year old with the same message of bringing the "federal monster" under control could raise enough money for a successful campaign.

JFK is featured quite prominently is this Ebook. His tax cuts gave us one of the best economies in the history of America.

You should find his economic philosophy both informative and illuminating; it is quite the opposite of today's diseased class warfare/class envy.

My employer is including my graduate school tuition reimbursements on my W-2 as wages. Where do I claim these education expenses on my Form 1040?

If your graduate school tuition is deductible and the reimbursements are included in your income as wages, you may take the expense as a miscellaneous itemized deduction on Form 1040, Schedule A (PDF), Itemized Deductions.

You may also need to attach Form 2106 (PDF), Employee Business Expenses. For more information, refer to Publication 970, Tax Benefits for Education, Chapter 12; Tax Topic 513, Educational Expenses; and Form 2106 (PDF), Employee Business Expenses.

Am I eligible to claim both my job education expenses (minus 2% of AGI) and the Lifetime Learning Credit on my taxes?

If you are eligible to deduct educational expenses and are also eligible for the lifetime learning credit, then it is possible to claim both, as long as you do NOT use the SAME educational expenses to claim both benefits.

Your may want to allocate some of your expenses to the deduction and others to the credit. This is sometimes desirable because a qualifying expense for one benefit may not be a qualifying expense for the other tax benefit.

For example, the cost of course-related books ordinarily qualifies for the deduction, but not for the lifetime learning credit. For more information, refer to Publication 970, Tax Benefits for Education; Form 8863 (PDF), Education Credits (Hope and Lifetime Learning Credits); and Tax Topic 513, Educational Expenses.

Can I deduct the cost of classes I need for work?

In some cases, you may be able to deduct the cost of classes you need for work. This deduction, however, would be subject to the 2 percent of AGI limitation, along with most other miscellaneous itemized deductions you list on Form 1040, Schedule A (PDF), Itemized Deductions.

For more information, refer to Publication 970, Tax Benefits for Education,

What types of educational expenses are deductible?

Deductible educational expenses include amounts spent for tuition, books, supplies, laboratory fees, and similar items.

They also include the cost of correspondence courses, as well as formal training and research you do as part of an educational program.

Transportation and travel expenses to attend qualified educational activities may also be deductible. For more information, refer to Publication 970, Tax Benefits for Education; Chapter 12 and Tax Topic 513, Educational Expenses.

My university required each incoming freshman to come to school with their own computer. Is there any way to deduct the cost of the computer from my tax liability?

The cost of a personal computer is generally a personal expense that is not deductible.

However, if the school includes the cost of school-supplied computers as part of the cost of tuition or as a fee required for attendance or enrollment, and bill students for computer software that students cannot obtain elsewhere, your expenses may qualify as an expense towards either the Lifetime Learning Credit or Hope Credit.

For more information, refer to Publication 970, Tax Benefits for Education, Chapters 2 and 3.

Amended Returns

After filing your return, you may realize you made an error. IRS corrects many errors during processing. However, there are certain situations that require you to file an Amended Return.

Note: The following applies forms 1040, 1040A, 1040EZ, or 1040NR or 1040NR-EZ.

Generally, you must file an Amended Return within 3 years from the date you filed your original return or within 2 years from the date you paid the tax, whichever is later.

The limits are different for net operating losses, foreign tax credits, and bad debts. For additional information, refer to Chapter 1 of Publication 17, Your Federal Income Tax. Publication 17 is available for download, or you may request a copy by calling 1-800-829-3676.

Social Security and Equivalent Railroad Retirement Benefits

If the only income you received during the tax year was your social security or equivalent railroad retirement benefits, your benefits are probably not taxable and you probably will not have to file a tax return.

If you also received other income, your benefits will not be taxed unless your modified adjusted gross income is more than the base amount for your filing status.

If you have income in addition to your benefits, you may have to file a return even if none of your benefits are taxable. Your taxable benefits and modified adjusted gross income are figured in a worksheet in the Form 1040 Instructions or Form 1040A Instructions.

To make a determination if your benefits are taxable, complete the social security benefits worksheet in the Form 1040 or 1040A instruction book.

The taxable benefits, if any, must be included in the gross income of the person who has the legal right to receive them. For example, if you and your child received benefits, but the check for your child was made out in your name, you must use only your own portion of the benefits in figuring if any part is taxable to you.

Half of the portion that belongs to your child must be added to your child's other income to determine if any of those benefits are taxable to your child.

If you are married and file a joint return, you and your spouse must combine your incomes, social security benefits, and equivalent railroad retirement benefits when figuring the taxable portion of your benefits.

If part of your benefits is taxable, you must use Form 1040 (PDF) or Form 1040A (PDF). You cannot use Form 1040EZ.

You should receive your Form SSA-1099 or Form RRB-1099 by early February of the current tax year. The form will show benefits paid to the person who has the legal right to receive them, and the amount of any benefits you repaid.

It will also show amounts by which the benefits were reduced because you received workers compensation benefits. The Substitute Workers Compensation benefits would be taxable to the same extent.

For additional information, refer to Publication 915, Social Security and Equivalent Railroad Retirement Benefits.

If any part of your social security or equivalent railroad retirement benefits will be taxable in the current tax year, you may request to have additional income tax withheld from your social security and/or tier 1 Railroad Retirement Benefits; you may request to have additional withholding from other income or pay estimated tax during the year. Refer to Publication 505, Tax Withholding and Estimated Tax, for additional information on estimated tax.

Issue Number: IR-2008-022

Inside This Issue

2008 Economic Stimulus Act Provides Tax Benefits to Businesses

WASHINGTON — In addition to providing stimulus payments to individuals, the Economic Stimulus Act of 2008 provides incentives to businesses.

These incentives include a special 50-percent depreciation allowance for 2008 purchases and an increase in the small business expensing limitation for tax years beginning in 2008.

50-Percent Special Depreciation Allowance

Depreciation is an income tax deduction that allows a taxpayer to recover the cost or other basis of certain property over several years. It is an annual allowance for the wear and tear, deterioration or obsolescence of the property.

Under the new law, a taxpayer is entitled to depreciate 50 percent of the adjusted basis of certain qualified property during the year that the property is placed in service. This is similar to the special depreciation allowance was previously available for certain property placed in service generally before Jan. 1, 2005, often referred to as “bonus depreciation.” To qualify for the 50 percent special depreciation allowance under the new law, the property must be placed in service after Dec. 31, 2007, but generally before Jan. 1, 2009.

To reflect the new 50-percent special depreciation allowance, the IRS is developing a new version of the depreciation and amortization form for fiscal year filers. The new form will be designated as the 2007 Form 4562-FY.

Section 179 Expensing

In general, a qualifying taxpayer can elect to treat the cost of certain property as an expense and deduct it in the year the property is placed in service instead of depreciating it over several years. This property is frequently referred to as section 179 property, after the relevant section in the Internal Revenue Code.

Under the new law, a qualifying business can expense up to $250,000 of section 179 property purchased by the taxpayer in a tax year beginning in 2008. Absent this legislation, the 2008 expensing limit for section 179 property would have been $128,000. The $250,000 amount provided under the new law is reduced if the cost of all section 179 property placed in service by the taxpayer during the tax year exceeds $800,000.

The new law does not alter the section 179 limitation imposed on sport utility vehicles, which have an expense limit of $25,000.

Student Loan Interest

Student loan interest is interest paid by you, or on your behalf, during the year on a qualified student loan. The maximum benefit can be found in Chapter 4, Student Loan Interest Deduction, of Publication 970, Tax Benefits for Education.

The student loan interest deduction is taken as an adjustment to income. This means you can claim this deduction even if you do not itemize deductions on Form 1040, Schedule A. You must meet several requirements to take this deduction.

Please refer to Chapter 4 of Publication 970, Tax Benefits for Education, for the maximum benefit amount.

Personal Exemptions

If you are a U.S. citizen or resident alien at the end of the tax year

and

Another taxpayer may not claim you as a dependent:

You may claim a personal exemption for yourself.

The amount of the exemption will depend on your Adjusted Gross Income (AGI) for the tax year. The amount of your exemption will be reduced if your AGI goes above a certain level for your filing status. Refer to the Form 1040 Instructions or the Form 1040A Instructions for further details.

To figure the amount you can claim for your personal exemption, please refer to Worksheet 2 on page 19 of Publication 501, Exemptions, Standard Deduction, and Filing Information. Publication 501 is available for download, or you may request a copy by calling 1-800-829-3676.

Dependents-continued

If your child was born alive during the year, and the dependency tests are met, you may take the full dependency exemption.

This is true even if the child lived only for a moment. State or local law must treat the child as having been born alive. There must be proof of a live birth shown by an official document, such as a birth certificate.

If your child was born and died in the tax year being filed, and you do not have a Social Security Number (SSN) for the child, you may attach a copy of the child's birth certificate instead.

If you do, enter "died" in the space you would normally enter the child's Social Security Number. You may not claim an exemption for a stillborn child.

If your dependent died during the year and otherwise met the dependency tests, you may take an exemption for your dependent.

Dependents

Due to tax law changes, the definition of dependent has changed for tax years starting in 2005. If you need information on claiming a dependent for years before 2005, see the form instructions for the tax year for which you are filing.

You are allowed one exemption for each person you can claim as a dependent.

You may take an exemption for your dependent even if your dependent files a tax return, except a joint return. Your dependent, however, cannot claim his or her personal exemption if you are entitled to do so.

If a housekeeper, maid, or servant works for you, you may not claim a dependency exemption for that person.

For additional information on Dependents, refer to Publication 501, Exemptions, Standard Deduction and Filing Information. Publication 501 is available for download, or you may request a copy by calling 1-800-829-3676.

Can You Use The Simplified Method To Figure The Taxable Part Of Your Pension Or Annuity?

Pensions – the General Rule and the Simplified Method

If you made after-tax contributions to your pension or annuity plan, you can exclude part of your pension or annuity payments from your income.

You must figure this tax-free part when the payments first begin. The tax-free amount remains the same each year, even if the amount of the payment changes.

If you begin receiving annuity payments from a qualified retirement plan after November 18, 1996, generally you use the Simplified Method to figure the tax–free part of the payments.

A qualified retirement plan is a qualified employee plan, a qualified employee annuity, or a tax–sheltered annuity plan. Under the Simplified Method, you figure the taxable and tax–free parts of your annuity payments by completing the Simplified Method Worksheet in the Form 1040 Instructions or Form 1040A Instructions or in Publication 575, Pension and Annuity Income.

For more information on the Simplified Method, refer to Publication 575, or if you receive United States Civil Service retirement benefits, refer to Publication 721, Tax Guide to U.S. Civil Service Retirement Benefits.

If you began receiving annuity payments from a qualified retirement plan after July 1, 1986 and before November 19, 1996, you generally could have chosen to use either the Simplified Method or the General Rule to figure the tax–free part of the payments.

If you receive annuity payments from a nonqualified retirement plan, you must use the General Rule. Under the General Rule, you figure the taxable and tax–free parts of your annuity payments using life expectancy tables prescribed by the IRS.

For a fee, the IRS will figure the tax–free part of your annuity payments for you. For more information, refer to Publication 939, General Rule for Pensions and Annuities.

Right-click to download Real World Economics: For High School Seniors, College Students and New Entrants To The Workforce.

It's Free-It's Instant

You will need Adobe Reader (the latest version is recommended) installed on your computer in order to open and read this ebook. You can get Adobe Reader here (a new window will open so you can download it without leaving this page).

If you want to open the file in your browser window, just click on the link. However, if you want to download the file to view later, then right-click on the link and choose "Save Target As" if you are using Internet Explorer or "Save Link As" if you are using Mozilla. Some Browsers use "Save File as" Then select where you want to save the file on your hard drive.

Once you have saved the file, locate where you saved it, and double click to open.

One of the main features is an outline of a plan for getting 25 to 30 year olds elected to congress.

This is in no way an endorsement of Ron Paul. It is to show that a 25 year old with the same message of bringing the "federal monster" under control could raise enough money for a succe