| Tax Law Changes for 2011 All Chapter references refer to IRS Publication 17 |
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What's New
The IRS has created a page on IRS.gov for information about this publication at www.irs.
gov/pub17. Information about any future developments affecting this publication (such as
legislation) will be posted on that page.
Due date of return. File Form 1040, 1040A, or 1040EZ by April 17, 2012. The due date is
April 17, instead of April 15, because April 15 is a Sunday and April 16 is the Emancipation
Day holiday in the District of Columbia.
Reporting capital gains and losses on new Form 8949. In most cases, you must report
your capital gains and losses on new Form 8949. Then you report certain totals from that
form on Schedule D (Form 1040). See chapter 16.
Standard mileage rates. The 2011 rate for business use of your car is 51 cents a mile for
miles driven before July 1, 2011, and 55 ½ cents a mile for miles driven after June 30,
2011. See chapter 26.The 2011 rate for use of your car to get medical care is 19 cents a
mile for miles driven before July 1, 2011, and 23 ½ cents a mile for miles driven after June
30, 2011. See chapter 21.The 2011 rate for use of your car to move is 19 cents a mile for
miles driven before July 1, 2011, and 23 ½ cents a mile for miles driven after June 30,
2011. See Publication 521, Moving Expenses.
Standard deduction increased. The standard deduction for some taxpayers who do not
itemize their deductions on Schedule A (Form 1040) is higher for 2011 than it was for
2010. The amount depends on your filing status.
Check the correct number of boxes below. Then go to the chart.
Exemption amount. The amount you can deduct for each exemption has increased. It was
$3,650 for 2010. It is $3,700 for 2011.
Self-employed health insurance deduction. This deduction is no longer allowed on
Schedule SE (Form 1040). However, you can still take it on Form 1040, line 29. See
chapter 21.
Alternative minimum tax (AMT) exemption amount increased. The AMT exemption
amount has increased to $48,450 ($74,450 if married filing jointly or a qualifying widow
(er); $37,225 if married filing separately).
Health savings accounts (HSAs) and Archer MSAs. For distributions after 2010, the
additional tax on distributions from HSAs and Archer MSAs not used for qualified medical
expenses has increased to 20%.Also beginning in 2011, amounts paid for medicine or a
drug are qualified medical expenses only if the medicine or drug is a prescribed drug or is
insulin.See the instructions for Form 8889 or Form 8853 for details.
Roth IRAs. If you converted or rolled over an amount to a Roth IRA in 2010 and did not
elect to report the taxable amount on your 2010 return, you generally must report half of it
on your 2011 return and the rest on your 2012 return. See Publication 575 for details.
Designated Roth accounts. If you rolled over an amount from a 401(k) or 403(b) plan to
a designated Roth account in 2010 and did not elect to report the taxable amount on your
2010 return, you generally must report half of it on your 2011 return and the rest on your
2012 return. See Publication 575 for details.
Alternative motor vehicle credit. You cannot claim the alternative motor vehicle credit
for a vehicle you bought in 2011, unless the vehicle is a new fuel cell motor vehicle. See
chapter 36.
First-time homebuyer credit. To claim the first-time homebuyer credit for 2011, you (or
your spouse if married) must have been a member of the uniformed services or Foreign
Service or an employee of the intelligence community on qualified official extended duty
outside the United States for at least 90 days during the period beginning after December
31, 2008, and ending before May 1, 2010. See chapter 36.
Repayment of first-time homebuyer credit. If you have to repay the credit, you may be
able to do so without attaching Form 5405. See chapter 36.
Nonbusiness energy property credit. This credit is figured differently for 2011 than it
was for 2010. See chapter 36 for details.
Health coverage tax credit. This credit has been extended, and the amount has changed.
See chapter 36 for details.
Foreign financial assets. If you had foreign financial assets in 2011, you may have to file
new Form 8938 with your return. Check www.IRS.gov/form8938 for details.
Schedule L. Schedule L is no longer in use. You do not need it to figure your 2011
standard deduction. Instead, see chapter 20 for information about your 2011 standard
deduction.
Making work pay credit. The making work pay credit has expired. You cannot claim it on
your 2011 return. Schedule M is no longer in use.
Mailing your return. If you are filing a paper return, you may be mailing it to a different
address this year because the IRS has changed the filing location for several areas. See
Where To File near the end of this publication for a list of IRS addresses.
Reminders
Listed below are important reminders and other items that may help you file your
2011 tax return. Many of these items are explained in more detail later in this
publication.
Enter your social security number (SSN). Enter your SSN in the space provided on your
tax form. If you filed a joint return for 2010 and are filing a joint return for 2011 with the
same spouse, enter your names and SSNs in the same order as on your 2010 return. See
chapter 1.
Secure your tax records from identity theft. Identity theft occurs when someone uses your
personal information such as your name, SSN, or other identifying information, without
your permission, to commit fraud or other crimes. An identity thief may use your SSN to
get a job or may file a tax return using your SSN to receive a refund.To reduce your risk:
Protect your SSN,
Ensure your employer is protecting your SSN, and
Be careful when choosing a tax preparer.
If your tax records are affected by identity theft and you receive a notice from the IRS,
respond right away to the name and phone number printed on the IRS notice or letter.If
your tax records are not currently affected by identity theft but you think you are at risk
due to a lost or stolen purse or wallet, questionable credit card activity or credit report, etc.,
contact the IRS Identity Protection Specialized Unit at 1-800-908-4490 or submit Form
14039.For more information, see Publication 4535, Identity Theft Prevention and Victim
Assistance. Victims of identity theft who are experiencing economic harm or a systemic
problem, or are seeking help in resolving tax problems that have not been resolved through
normal channels, may be eligible for Taxpayer Advocate Service (TAS) assistance. You can
reach TAS by calling the National Taxpayer Advocate helpline at 1-877-777-4778 or
TTY/TDD 1-800-829-4059. Protect yourself from suspicious emails or phishing schemes.
Phishing is the creation and use of email and websites designed to mimic legitimate business
emails and websites. The most common form is the act of sending an email to a user
falsely claiming to be an established legitimate enterprise in an attempt to scam the user into
surrendering private information that will be used for identity theft.The IRS does not initiate
contacts with taxpayers via emails. Also, the IRS does not request detailed personal
information through email or ask taxpayers for the PIN numbers, passwords, or similar
secret access information for their credit card, bank, or other financial accounts.If you
receive an unsolicited email claiming to be from the IRS, forward the message to:
phishing@irs.gov. You may also report misuse of the IRS name, logo, forms or other IRS
property to the Treasury Inspector General for Tax Administration toll-free at 1-800-366-
4484. You can forward suspicious emails to the Federal Trade Commission at: spam@uce.
gov or contact them at www.ftc.gov/idtheft or 1-877-IDTHEFT (1-877-438-4338).Visit
IRS.gov and enter “identity theft” in the search box to learn more about identity theft and
how to reduce your risk.
Taxpayer identification numbers. You must provide the taxpayer identification number for
each person for whom you claim certain tax benefits. This applies even if the person was
born in 2011. Generally, this number is the person's social security number (SSN). See
chapter 1.
Foreign source income. If you are a U.S. citizen with income from sources outside the
United States (foreign income), you must report all such income on your tax return unless
it is exempt by U.S. law. This is true whether you reside inside or outside the United States
and whether or not you receive a Form W-2 or Form 1099 from the foreign payer. This
applies to earned income (such as wages and tips) as well as unearned income (such as
interest, dividends, capital gains, pensions, rents and royalties). If you reside outside the
United States, you may be able to exclude part or all of your foreign source earned income.
For details, see Publication 54, Tax Guide for U.S. Citizens and Resident Aliens Abroad.
Automatic 6-month extension to file tax return. You can use Form 4868, Application for
Automatic Extension of Time To File U.S. Individual Income Tax Return, to obtain an
automatic 6-month extension of time to file your tax return. See chapter 1.
Include your phone number on your return. To promptly resolve any questions we have in
processing your tax return, we would like to be able to call you. Please enter your daytime
telephone number on your tax form next to your signature.
Payment of taxes. Make your check or money order payable to “United States Treasury.”
You can pay your taxes by credit or debit card, using the Electronic Federal Tax Payment
System (EFTPS), or, if you file electronically, by electronic funds withdrawal. See chapter
1.
Faster ways to file your return. The IRS offers fast, accurate ways to file your tax return
information without filing a paper tax return. You can use IRS e-file (electronic filing). See
chapter 1.
Free electronic filing. You may be able to file your 2011 taxes online for free thanks to an
electronic filing agreement. See chapter 1.
Change of address. If you change your address, you should notify the IRS. See Change of
Address in chapter 1.
Refund on a late filed return. If you were due a refund but you did not file a return, you
generally must file your return within 3 years from the date the return was due (including
extensions) to get that refund. See chapter 1.
Frivolous tax submissions. The IRS has published a list of positions that are identified as
frivolous. The penalty for filing a frivolous tax return is $5,000. Also, the $5,000 penalty
will apply to other specified frivolous submissions. See chapter 1.
Filing erroneous claim for refund or credit. You may have to pay a penalty if you file an
erroneous claim for refund or credit. See chapter 1.
Privacy Act and paperwork reduction information. The IRS Restructuring and Reform Act
of 1998, the Privacy Act of 1974, and the Paperwork Reduction Act of 1980 require that
when we ask you for information we must first tell you what our legal right is to ask for
the information, why we are asking for it, how it will be used, what could happen if we do
not receive it, and whether your response is voluntary, required to obtain a benefit, or
mandatory under the law. A complete statement on this subject can be found in your tax
form instructions.
Customer service for taxpayers. The IRS has expanded customer service for taxpayers.
You can set up a personal appointment at the most convenient Taxpayer Assistance Center,
on the most convenient business day. See How To Get Tax Help in the back of this
publication.
Preparer e-file mandate. A new law requires some paid preparers to e-file returns they
prepare and file. Your preparer may make you aware of this requirement and the options
available to you.
Treasury Inspector General for Tax Administration. If you want to confidentially report
misconduct, waste, fraud, or abuse by an IRS employee, you can call 1-800-366-4484 (1-
800-877-8339 for TTY/TDD users). You can remain anonymous.
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.
The IRS has created a page on IRS.gov for information about this publication at www.irs.
gov/pub17. Information about any future developments affecting this publication (such as
legislation) will be posted on that page.
Due date of return. File Form 1040, 1040A, or 1040EZ by April 17, 2012. The due date is
April 17, instead of April 15, because April 15 is a Sunday and April 16 is the Emancipation
Day holiday in the District of Columbia.
Reporting capital gains and losses on new Form 8949. In most cases, you must report
your capital gains and losses on new Form 8949. Then you report certain totals from that
form on Schedule D (Form 1040). See chapter 16.
Standard mileage rates. The 2011 rate for business use of your car is 51 cents a mile for
miles driven before July 1, 2011, and 55 ½ cents a mile for miles driven after June 30,
2011. See chapter 26.The 2011 rate for use of your car to get medical care is 19 cents a
mile for miles driven before July 1, 2011, and 23 ½ cents a mile for miles driven after June
30, 2011. See chapter 21.The 2011 rate for use of your car to move is 19 cents a mile for
miles driven before July 1, 2011, and 23 ½ cents a mile for miles driven after June 30,
2011. See Publication 521, Moving Expenses.
Standard deduction increased. The standard deduction for some taxpayers who do not
itemize their deductions on Schedule A (Form 1040) is higher for 2011 than it was for
2010. The amount depends on your filing status.
Check the correct number of boxes below. Then go to the chart.
Exemption amount. The amount you can deduct for each exemption has increased. It was
$3,650 for 2010. It is $3,700 for 2011.
Self-employed health insurance deduction. This deduction is no longer allowed on
Schedule SE (Form 1040). However, you can still take it on Form 1040, line 29. See
chapter 21.
Alternative minimum tax (AMT) exemption amount increased. The AMT exemption
amount has increased to $48,450 ($74,450 if married filing jointly or a qualifying widow
(er); $37,225 if married filing separately).
Health savings accounts (HSAs) and Archer MSAs. For distributions after 2010, the
additional tax on distributions from HSAs and Archer MSAs not used for qualified medical
expenses has increased to 20%.Also beginning in 2011, amounts paid for medicine or a
drug are qualified medical expenses only if the medicine or drug is a prescribed drug or is
insulin.See the instructions for Form 8889 or Form 8853 for details.
Roth IRAs. If you converted or rolled over an amount to a Roth IRA in 2010 and did not
elect to report the taxable amount on your 2010 return, you generally must report half of it
on your 2011 return and the rest on your 2012 return. See Publication 575 for details.
Designated Roth accounts. If you rolled over an amount from a 401(k) or 403(b) plan to
a designated Roth account in 2010 and did not elect to report the taxable amount on your
2010 return, you generally must report half of it on your 2011 return and the rest on your
2012 return. See Publication 575 for details.
Alternative motor vehicle credit. You cannot claim the alternative motor vehicle credit
for a vehicle you bought in 2011, unless the vehicle is a new fuel cell motor vehicle. See
chapter 36.
First-time homebuyer credit. To claim the first-time homebuyer credit for 2011, you (or
your spouse if married) must have been a member of the uniformed services or Foreign
Service or an employee of the intelligence community on qualified official extended duty
outside the United States for at least 90 days during the period beginning after December
31, 2008, and ending before May 1, 2010. See chapter 36.
Repayment of first-time homebuyer credit. If you have to repay the credit, you may be
able to do so without attaching Form 5405. See chapter 36.
Nonbusiness energy property credit. This credit is figured differently for 2011 than it
was for 2010. See chapter 36 for details.
Health coverage tax credit. This credit has been extended, and the amount has changed.
See chapter 36 for details.
Foreign financial assets. If you had foreign financial assets in 2011, you may have to file
new Form 8938 with your return. Check www.IRS.gov/form8938 for details.
Schedule L. Schedule L is no longer in use. You do not need it to figure your 2011
standard deduction. Instead, see chapter 20 for information about your 2011 standard
deduction.
Making work pay credit. The making work pay credit has expired. You cannot claim it on
your 2011 return. Schedule M is no longer in use.
Mailing your return. If you are filing a paper return, you may be mailing it to a different
address this year because the IRS has changed the filing location for several areas. See
Where To File near the end of this publication for a list of IRS addresses.
Reminders
Listed below are important reminders and other items that may help you file your
2011 tax return. Many of these items are explained in more detail later in this
publication.
Enter your social security number (SSN). Enter your SSN in the space provided on your
tax form. If you filed a joint return for 2010 and are filing a joint return for 2011 with the
same spouse, enter your names and SSNs in the same order as on your 2010 return. See
chapter 1.
Secure your tax records from identity theft. Identity theft occurs when someone uses your
personal information such as your name, SSN, or other identifying information, without
your permission, to commit fraud or other crimes. An identity thief may use your SSN to
get a job or may file a tax return using your SSN to receive a refund.To reduce your risk:
Protect your SSN,
Ensure your employer is protecting your SSN, and
Be careful when choosing a tax preparer.
If your tax records are affected by identity theft and you receive a notice from the IRS,
respond right away to the name and phone number printed on the IRS notice or letter.If
your tax records are not currently affected by identity theft but you think you are at risk
due to a lost or stolen purse or wallet, questionable credit card activity or credit report, etc.,
contact the IRS Identity Protection Specialized Unit at 1-800-908-4490 or submit Form
14039.For more information, see Publication 4535, Identity Theft Prevention and Victim
Assistance. Victims of identity theft who are experiencing economic harm or a systemic
problem, or are seeking help in resolving tax problems that have not been resolved through
normal channels, may be eligible for Taxpayer Advocate Service (TAS) assistance. You can
reach TAS by calling the National Taxpayer Advocate helpline at 1-877-777-4778 or
TTY/TDD 1-800-829-4059. Protect yourself from suspicious emails or phishing schemes.
Phishing is the creation and use of email and websites designed to mimic legitimate business
emails and websites. The most common form is the act of sending an email to a user
falsely claiming to be an established legitimate enterprise in an attempt to scam the user into
surrendering private information that will be used for identity theft.The IRS does not initiate
contacts with taxpayers via emails. Also, the IRS does not request detailed personal
information through email or ask taxpayers for the PIN numbers, passwords, or similar
secret access information for their credit card, bank, or other financial accounts.If you
receive an unsolicited email claiming to be from the IRS, forward the message to:
phishing@irs.gov. You may also report misuse of the IRS name, logo, forms or other IRS
property to the Treasury Inspector General for Tax Administration toll-free at 1-800-366-
4484. You can forward suspicious emails to the Federal Trade Commission at: spam@uce.
gov or contact them at www.ftc.gov/idtheft or 1-877-IDTHEFT (1-877-438-4338).Visit
IRS.gov and enter “identity theft” in the search box to learn more about identity theft and
how to reduce your risk.
Taxpayer identification numbers. You must provide the taxpayer identification number for
each person for whom you claim certain tax benefits. This applies even if the person was
born in 2011. Generally, this number is the person's social security number (SSN). See
chapter 1.
Foreign source income. If you are a U.S. citizen with income from sources outside the
United States (foreign income), you must report all such income on your tax return unless
it is exempt by U.S. law. This is true whether you reside inside or outside the United States
and whether or not you receive a Form W-2 or Form 1099 from the foreign payer. This
applies to earned income (such as wages and tips) as well as unearned income (such as
interest, dividends, capital gains, pensions, rents and royalties). If you reside outside the
United States, you may be able to exclude part or all of your foreign source earned income.
For details, see Publication 54, Tax Guide for U.S. Citizens and Resident Aliens Abroad.
Automatic 6-month extension to file tax return. You can use Form 4868, Application for
Automatic Extension of Time To File U.S. Individual Income Tax Return, to obtain an
automatic 6-month extension of time to file your tax return. See chapter 1.
Include your phone number on your return. To promptly resolve any questions we have in
processing your tax return, we would like to be able to call you. Please enter your daytime
telephone number on your tax form next to your signature.
Payment of taxes. Make your check or money order payable to “United States Treasury.”
You can pay your taxes by credit or debit card, using the Electronic Federal Tax Payment
System (EFTPS), or, if you file electronically, by electronic funds withdrawal. See chapter
1.
Faster ways to file your return. The IRS offers fast, accurate ways to file your tax return
information without filing a paper tax return. You can use IRS e-file (electronic filing). See
chapter 1.
Free electronic filing. You may be able to file your 2011 taxes online for free thanks to an
electronic filing agreement. See chapter 1.
Change of address. If you change your address, you should notify the IRS. See Change of
Address in chapter 1.
Refund on a late filed return. If you were due a refund but you did not file a return, you
generally must file your return within 3 years from the date the return was due (including
extensions) to get that refund. See chapter 1.
Frivolous tax submissions. The IRS has published a list of positions that are identified as
frivolous. The penalty for filing a frivolous tax return is $5,000. Also, the $5,000 penalty
will apply to other specified frivolous submissions. See chapter 1.
Filing erroneous claim for refund or credit. You may have to pay a penalty if you file an
erroneous claim for refund or credit. See chapter 1.
Privacy Act and paperwork reduction information. The IRS Restructuring and Reform Act
of 1998, the Privacy Act of 1974, and the Paperwork Reduction Act of 1980 require that
when we ask you for information we must first tell you what our legal right is to ask for
the information, why we are asking for it, how it will be used, what could happen if we do
not receive it, and whether your response is voluntary, required to obtain a benefit, or
mandatory under the law. A complete statement on this subject can be found in your tax
form instructions.
Customer service for taxpayers. The IRS has expanded customer service for taxpayers.
You can set up a personal appointment at the most convenient Taxpayer Assistance Center,
on the most convenient business day. See How To Get Tax Help in the back of this
publication.
Preparer e-file mandate. A new law requires some paid preparers to e-file returns they
prepare and file. Your preparer may make you aware of this requirement and the options
available to you.
Treasury Inspector General for Tax Administration. If you want to confidentially report
misconduct, waste, fraud, or abuse by an IRS employee, you can call 1-800-366-4484 (1-
800-877-8339 for TTY/TDD users). You can remain anonymous.
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.
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