The IRS determines whether your Social Security benefits are taxable by looking at your total income and marital status. Form SSA-1099, which Social Security recipients should receive by January 31, shows your total benefits, but determining your taxable benefits requires putting pencil to paper.
Generally, if Social Security benefits are your only income, your benefits are not taxable and you probably do not need to file a federal income tax return. If you received Social Security benefits plus other income, the answer to how much, if any, is taxable can be found in the worksheet in the Form 1040 or 1040A instruction book.
For a quick computation, add one-half of your Social Security benefits to all your other income, including tax-exempt interest. If this amount is greater than the base amount for your filing status, a part of your benefits will be taxable.
The 2004 base amounts are:
$25,000 for single, head of household, or qualifying widow/widower with a dependent child
$25,000 for married individuals filing separately who did not live with their spouses at any time during the year
$32,000 for married couples filing jointly
$0 for married persons filing separately who lived together during the year
If your benefits are taxable, you can avoid estimated tax payments and minimize your tax bill next year by having federal income tax withheld from your benefits. Simply complete Form W-4V, Voluntary Withholding Request, and file it with the Social Security Administration.
New Law Changes Highway Use Tax Rules: Installment Payment Option Eliminated
The IRS is reminding truckers and other owners of heavy highway vehicles that the installment option for paying the federal highway use tax will no longer be available. This change was included in the American Jobs Creation Act of 2004 and applies to filers of Form 2290, Heavy Highway Vehicle Use Tax Return.
IRS Certifies 2006 Toyota Hybrid for Clean Fuel Deduction
The Internal Revenue Service has certified the 2006 Toyota Highlander Hybrid as being eligible for the clean-burning fuel deduction. This certification means that taxpayers who purchase one of these hybrid vehicles new during calendar year 2005 may claim a tax deduction of up to $2000 on Form 1040.
Gambling Income and Expenses - Taxes
Gambling income ... but is not limited to, winnings from ... raffles, horse and dog races and casinos. ... gambling income also includes the fair market value of prizes such as
