Q4RPFCOVER

1040

Form 1040
2013 Tax Year

Registered Tax Return Preparer Edition

TAX PREPARATION

2013 Key Amounts
Standard Deduction		Earned Income Credit (Maximum)
MFJ or QW¹	$ 12,200	No children	$ 487
Single²	6,100	1 child	3,250
HOH²	8,950	2 children	5,372
MFS¹	6,100	>2 children	6,044
Dependent²	1,000³	Investment income limit	3,300
Personal Exemption		Kiddie Tax Threshold
$3,900		$2,000
Gift Tax Annual Exclusion		Elective Deferral Limits
$14,000		SIMPLE IRA Plan
Estate and Gift Tax Exclusion Amount		< age 50	$ 12,000
$5,250,000		≥ age 50	14,500
Standard Mileage Rates
Business	56.5¢	401(k), 403(b) and 457 Plans
Medical/moving	24¢	< age 50	$ 17,500
Charitable	14¢	≥ age 50	23,000
Profit-Sharing Plan/SEP
Contribution limit			$ 51,000
Compensation limit⁴			$255,000
Health Savings Accounts (HSAs)
Self-only coverage	Contribution (deduction) limit		$ 3,250
	Plan minimum deductible		1,250
	Plan out-of-pocket limit		6,250
Family coverage	Contribution (deduction) limit		$ 6,450
	Plan minimum deductible		2,500
	Plan out-of-pocket limit		12,500
Additional contribution amount if age 55 or older			$ 1,000
¹ Add $1,200 for age 65 or older or blind, each. ² Add $1,500 for age 65 or older or blind, each. ³ If greater, amount of earned income plus $350 (but not to exceed $6,100). ⁴ For computing employer contributions.

2013 Quick Tax Method
MFJ, QW Taxable Income
$	0	-	$	17,850	×	10.0%	minus	$	0.00	=	Tax
	17,851	-		72,500	×	15.0	minus		892.50	=	Tax
	72,501	-		146,400	×	25.0	minus		8,142.50	=	Tax
	146,401	-		223,050	×	28.0	minus		12,534.50	=	Tax
	223,051	-		398,350	×	33.0	minus		23,687.00	=	Tax
	398,351	-		450,000	×	35.0	minus		31,654.00	=	Tax
	450,001	and over			×	39.6	minus		52,354.00	=	Tax
Single Taxable Income
$	0	-	$	8,925	×	10.0%	minus	$	0.00	=	Tax
	8,926	-		36,250	×	15.0	minus		446.25	=	Tax
	36,251	-		87,850	×	25.0	minus		4,071.25	=	Tax
	87,851	-		183,250	×	28.0	minus		6,706.75	=	Tax
	183,251	-		398,350	×	33.0	minus		15,869.25	=	Tax
	398,351	-		400,000	×	35.0	minus		23,836.25	=	Tax
	400,001	and over			×	39.6	minus		42,236.25	=	Tax
HOH Taxable Income
$	0	-	$	12,750	×	10.0%	minus	$	0.00	=	Tax
	12,751	-		48,600	×	15.0	minus		637.50	=	Tax
	48,601	-		125,450	×	25.0	minus		5,497.50	=	Tax
	125,451	-		203,150	×	28.0	minus		9,261.00	=	Tax
	203,151	-		398,350	×	33.0	minus		19,418.50	=	Tax
	398,351	-		425,000	×	35.0	minus		27,385.50	=	Tax
	425,001	and over			×	39.6	minus		46,935.50	=	Tax
MFS Taxable Income
$	0	-	$	8,925	×	10.0%	minus	$	0.00	=	Tax
	8,926	-		36,250	×	15.0	minus		446.25	=	Tax
	36,251	-		73,200	×	25.0	minus		4,071.25	=	Tax
	73,201	-		111,525	×	28.0	minus		6,267.25	=	Tax
	111,526	-		199,175	×	33.0	minus		11,843.50	=	Tax
	199,176	-		225,000	×	35.0	minus		15,827.00	=	Tax
	225,001	and over			×	39.6	minus		26,177.00	=	Tax
Note: Assumes taxable income is all ordinary income. High-income taxpayers may also be subject to the 3.8% tax on net investment income and/or the 0.9% additional Medicare tax on earned income. Caution: IRS Tax Tables must be used for taxable income under $100,000. To calculate the exact tax using the Quick Tax Method for taxable income under $100,000, round taxable income to the nearest $25 or $75 increment before using the formula. Round $50 or $100 increments up.

2013 AGI Phase-Out Amounts/Thresholds
*Filing Status*	Tuition and Fees Deduction¹		Student Loan Interest Deduction		Education Savings Bond Interest Exclusion		Lifetime Learning Credit	American Opportunity Credit	Personal Exemptions
MFJ	$130,000 / $160,000		$125,000 - $155,000		$112,050 - $142,050		$107,000 - $127,000	$160,000 - $180,000	$300,000 - $422,500
QW	65,000 / 80,000		60,000 - 75,000		112,050 - 142,050		53,000 - 63,000	80,000 - 90,000	300,000 - 422,500
Single	65,000 / 80,000		60,000 - 75,000		74,700 - 89,700		53,000 - 63,000	80,000 - 90,000	250,000 - 372,500
HOH	65,000 / 80,000		60,000 - 75,000		74,700 - 89,700		53,000 - 63,000	80,000 - 90,000	275,000 - 397,500
MFS	Do Not Qualify		Do Not Qualify		Do Not Qualify		Do Not Qualify	Do Not Qualify	150,000 - 211,250
	Itemized Deductions²	Saver’s Credit³	Earned Income Credit³				Traditional IRA Deduction⁴	Roth IRA Contribution	Net Investment Income Tax⁶
	Itemized Deductions²	Saver’s Credit³	No Child	1 Child	2 Children	>2 Children	Traditional IRA Deduction⁴	Roth IRA Contribution	Net Investment Income Tax⁶
MFJ	$ 300,000	$ 59,000	$ 19,680	$ 43,210	$ 48,378	$ 51,567	$ 95,000 - $115,000	$178,000 - $188,000	$250,000
QW	300,000	29,500	14,340	37,870	43,038	46,227	95,000 - 115,000	178,000 - 188,000	250,000
Single	250,000	29,500	14,340	37,870	43,038	46,227	59,000 - 69,000	112,000 - 127,000	200,000
HOH	275,000	44,250	14,340	37,870	43,038	46,227	59,000 - 69,000	112,000 - 127,000	200,000
MFS	150,000	29,500	Do Not Qualify				0⁵- 10,000	0⁵- 10,000	125,000
¹ Amounts shown are thresholds for $4,000 and $2,000 deduction, respectively. ² Amount at which phase-out begins. ³ Amount at which phase-out is complete. ⁴ Phase-out only applies if taxpayer is covered by an employer retirement plan. For MFJ, phase-out range for non-covered spouse is $178,000-$188,000. ⁵ Married individuals filing MFS who live apart at all times during the year are treated as single. ⁶ Amount at which tax begins.

1040 Quickfinder^® Handbook—Registered Tax Return
Preparer Edition

ISBN 978-0-7646-6594-4

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The 1040 Quickfinder^® Handbook—Registered Tax Return Preparer Edition is published by Thomson Reuters. Reproduction is prohibited without written permission of the publisher. Not assignable without consent.

The 1040 Quickfinder^® Handbook—Registered Tax Return Preparer Edition is to be used as a first-source, quick reference to basic tax principles used in preparing individual income tax returns. The focus of this handbook is to present often-needed reference information in a concise, easy-to-use format. The summaries, highlights, tax tips and other information included herein are intended to apply to the average individual taxpayer only. Information included is general in nature and we acknowledge the existence of many exceptions in the area of income tax. The information this handbook contains has been carefully compiled from sources believed to be reliable, but its accuracy is not guaranteed. The author/publisher is not engaged in rendering legal, accounting or other advice and will not be held liable for any actions or suit based on this handbook. For further information regarding a specific situation, see applicable IRS publications, rulings, regulations, court cases and Code sections. This handbook is not intended to be used as your only reference source.

2014 Key Amounts
Standard Deduction		Earned Income Credit (Maximum)
MFJ or QW¹	$ 12,400	No Children	$ 496
Single²	6,200	1 Child	3,305
HOH²	9,100	2 Children	5,460
MFS¹	6,200	>2 Children	6,143
Dependent²	1,000⁵	Investment Income Limit	$ 3,350
Traditional IRA Deduction Phase-Out Begins at AGI of		Elective Deferral Limits
Traditional IRA Deduction Phase-Out Begins at AGI of		SIMPLE IRA
MFJ,⁴ QW⁴	$ 96,000	< age 50	$ 12,000
MFJ³	181,000	≥ age 50	14,500
Single⁴	60,000	401(k), 403(b) and 457 Plans
HOH⁴	60,000	< age 50	$ 17,500
MFS⁴	0	≥ age 50	23,000
Gift Tax Annual Exclusion		Kiddie Tax Threshold
$14,000		$2,000
Profit-Sharing Plan/SEP
Contribution limit			$ 52,000
Compensation limit (for computing employer contributions)			260,000
¹ Add $1,200 for ≥ age 65 or blind, each. ² Add $1,550 for ≥ age 65 or blind, each. ³ Noncovered spouse. ⁴ Covered by an employer retirement plan. ⁵ If greater, earned income plus $350, not to exceed $6,200.

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2014 Quick Tax Method
MFJ or QW Taxable Income
$	0	-	$	18,150	×	10.0%	minus	$	0.00	=	Tax
	18,151	-		73,800	×	15.0	minus		907.50	=	Tax
	73,801	-		148,850	×	25.0	minus		8,287.50	=	Tax
	148,851	-		226,850	×	28.0	minus		12,753.00	=	Tax
	226,851	-		405,100	×	33.0	minus		24,095.50	=	Tax
	405,101	-		457,600	×	35.0	minus		32,197.50	=	Tax
	457,601	and over			×	39.6	minus		53,247.10	=	Tax
Single Taxable Income
$	0	-	$	9,075	×	10.0%	minus	$	0.00	=	Tax
	9,076	-		36,900	×	15.0	minus		453.75	=	Tax
	36,901	-		89,350	×	25.0	minus		4,143.75	=	Tax
	89,351	-		186,350	×	28.0	minus		6,824.25	=	Tax
	186,351	-		405,100	×	33.0	minus		16,141.75	=	Tax
	405,101	-		406,750	×	35.0	minus		24,243.75	=	Tax
	406,751	and over			×	39.6	minus		42,954.25	=	Tax
HOH Taxable Income
$	0	-	$	12,950	×	10.0%	minus	$	0.00	=	Tax
	12,951	-		49,400	×	15.0	minus		647.50	=	Tax
	49,401	-		127,550	×	25.0	minus		5,587.50	=	Tax
	127,551	-		206,600	×	28.0	minus		9,414.00	=	Tax
	206,601	-		405,100	×	33.0	minus		19,744.00	=	Tax
	405,101	-		432,200	×	35.0	minus		27,846.00	=	Tax
	432,201	and over			×	39.6	minus		47,727.20	=	Tax
MFS Taxable Income
$	0	-	$	9,075	×	10.0%	minus	$	0.00	=	Tax
	9,076	-		36,900	×	15.0	minus		453.75	=	Tax
	36,901	-		74,425	×	25.0	minus		4,143.75	=	Tax
	74,426	-		113,425	×	28.0	minus		6,376.50	=	Tax
	113,426	-		202,550	×	33.0	minus		12,047.75	=	Tax
	202,551	-		228,800	×	35.0	minus		16,098.75	=	Tax
	228,801	and over			×	39.6	minus		26,623.55	=	Tax
Note: Assumes taxable income is all ordinary income. High-income taxpayers may also be subject to the 3.8% tax on net investment income and/or the 0.9% additional Medicare tax on earned income.

Tax Rules By Age for 2013
*Age*	*Rule*
13	Cannot claim a child care credit for children age 13 or older.
17	Cannot claim $1,000 child tax credit for children age 17 or older.
18	• Children working for parents’ unincorporated business subject to FICA. • Generally cannot contribute to an ESA for children age 18 or older. • Adoption credit/exclusion generally unavailable for children age 18 or older. • Taxpayer qualifies for saver’s credit (if neither a dependent nor student). • Kiddie tax doesn’t apply if child’s earned income > than half his support.
19	• Exemption for dependent children who are not full-time students expires. • Kiddie tax generally no longer applies except to full-time students.
21	Children working for parents’ unincorporated business subject to FUTA.
24	• Exemption for dependent children who are full-time-students expires. • Can purchase savings bonds and exclude income used for education. • Kiddie tax no longer applies.
25	Taxpayers with no children qualify for EIC.
27	Income exclusion for health insurance coverage and self-employed health insurance deduction for coverage of children age 26 and younger expires.
30	Generally must distribute ESA when beneficiary reaches age 30.
50	• Eligible for catch-up contributions to IRAs, SIMPLE-IRAs, 401(k), 403(b) and 457 plans. • Qualified public safety employees eligible for penalty-free withdrawals from a governmental defined benefit pension plan, if retired.
55	• Eligible for penalty-free withdrawal from employer retirement plan (but not an IRA) if separated from service. • Eligible for catch-up contributions to HSAs.
59½	• Penalty for early withdrawal from retirement accounts expires. • Roth IRA distributions are tax-free (if any Roth held for at least five years).
65	• Non-itemizers become eligible for a higher standard deduction. • Taxpayers with no children no longer qualify for EIC. • HSA and MSA withdrawals not used for medical costs are taxed but no longer subject to a 20% penalty. • Eligible for credit for the elderly. • 7.5% (rather than 10%) of AGI threshold applies to medical expenses.
70½	• Contributions no longer allowed to traditional IRAs. • RMDs from retirement plans (other than Roth IRAs) must begin.