1. Topic 558 - Tax on Early Distributions from Retirement Plans, Other Than IRAs
To discourage the use of retirement funds for purposes other than normal retirement, the law imposes a 10% additional tax on certain early
distributions of these funds. Early distributions are those you receive from a qualified retirement plan or deferred annuity contract before reaching
age 59 1/2. The term "qualified retirement plan" means:
• A qualified employee plan under section 401(a), such as a section 401(k) plan
• A qualified employee annuity plan under section 403(a)
• A tax-sheltered annuity plan under section 403(b) for employees of public schools or tax-exempt organizations, or
• An individual retirement account under section 408(a) or an individual retirement annuity under section 408(b)
While an eligible State or local government section 457 deferred compensation plan is not a qualified retirement plan, any distribution attributable to
amounts the plan received in a direct transfer or rollover from one of the other plans listed here would be subject to the 10% additional tax.
Distributions that are not taxable, such as distributions that you roll over to another qualified retirement plan or a distribution of your designated Roth
IRA contributions are not subject to this 10% additional tax. For more information on rollovers, refer to Topic 413.
There are certain exceptions to this additional tax. The following six exceptions apply to distributions from any qualified retirement plan:
• Distributions made to your beneficiary or estate on or after your death
• Distributions made because you are totally and permanently disabled
• Distributions made as part of a series of substantially equal periodic payments over your life expectancy or the life expectancies of
you and your designated beneficiary. If these distributions are from a qualified plan other than an IRA, you must separate from service
with this employer before the payments begin for this exception to apply
• Distributions that are equal to or less than your deductible medical expenses, that is, the amount of your medical expenses that is more
than 7.5% of your adjusted gross income. You do not have to itemize to meet this exception. For more information on medical
expenses, refer to Topic 502
• Distributions made due to an IRS levy of the plan
• Distributions to qualified reservists. Generally, these are distributions made to individuals called to active duty after September 11,
2001 (See section 107 of the Heroes Earnings Assistance and Relief Act of 2008 ("HEART" H. R. 6081), section 72(t)(2)(G) is
amended striking this phrase. The amendment made by section 107 shall apply to individuals ordered or called to active duty on or
after December 31, 2007.)
The following additional exceptions apply only to distributions from a qualified retirement plan other than an IRA:
1. Distributions made to you after you separated from service with your employer if the separation occurred in or after the year you
reached age 55, or distributions from qualified governmental defined benefit plans if you were a qualified public safety employee
(State or local government) who separated from service on or after you reached age 50,
2. Distributions made to an alternate payee under a qualified domestic relations order, and
3. Distributions of dividends from employee stock ownership plans.
Refer to Topic 557 for information on the tax on early distributions from IRAs. For more information, refer to Publication 575, Pension and Annuity
Income, and Publication 590, Individual Retirement Arrangements (IRAs).
The 10% additional tax is reported on the appropriate line of Form 1040 (PDF). You must also file Form 5329 (PDF), Additional Taxes on Qualified
Plans (Including IRA's) and other Tax-Favored Accounts, if:
1. Your distribution is subject to the tax, and distribution code "1" is not shown in the appropriate box of Form 1099-R (PDF), or
2. One of the exceptions applies but the box labeled "Distribution Code(s)" does not show a distribution code of "2", "3", or "4". On the
other hand, you do not need to file Form 5329 if your distribution is subject to the tax and a distribution code of "1" shows in the
appropriate box. In this case enter the 10% additional tax on the appropriate line of Form 1040 and write "no" on the dotted line next
to the appropriate line.
Distributions from a qualified retirement plan are subject to federal income tax withholding; however, if your distribution is subject to the 10%
additional tax, your withholding may not be enough. You may have to make estimated tax payments. For more information on estimated tax
payments, refer to Publication 505, Tax Withholding and Estimated Tax.

2. What if I lose my job?
The loss of a job may create new tax issues. Severance pay and unemployment compensation are taxable.
Payments for any accumulated vacation or sick time also are taxable. You should ensure that enough taxes are
withheld from these payments or make estimated tax payments to avoid a big bill at tax time. Public assistance
and food stamps are not taxable. The IRS has updated a helpful publication which lists a number of job-loss
related tax issues. For more information, see Publication 4128, Tax Impact of Job Loss and the Tax Center to
Assist Unemployed Taxpayers.

3. Tax Center to Assist Unemployed Taxpayers
The “What Ifs” of an Economic Downturn
The Internal Revenue Service recognizes that many people may be having difficult times financially. There can
be a tax impact to events such as job loss, debt forgiveness or tapping a retirement fund. If your income
decreased, you may be newly eligible for certain tax credits, such as the Earned Income Tax Credit.
Publications to assist unemployed taxpayers
Publication 4128 , Tax Impact of Job Loss
Publication 4128(SP), Tax Impact of Job Loss (Spanish version)
Publication 4763, Job Related Questions During an Economic Downturn
Publication 4763(SP), Job Related Questions During an Economic Downturn (Spanish version)
Assistance with filing and paying taxes
If you have troubles paying your tax bill, contact the IRS immediately. There are steps we can take to help ease
the burden. You should file a tax return even if you are unable to pay so you can avoid additional penalties.
Free Tax Help
Publication 1546, The Taxpayer Advocate Service at the IRS – How to Get Help with Unresolved Tax Problems
Payment Plans, Installment Agreements
Offers in Compromise
IRS Help for Financially Distressed Taxpayers
Starting your own business
Some taxpayers may see unemployment as an opportunity to start their own businesses.
Starting a Business
Self-Employed Individuals Tax Center
Small Business Tax Workshops Learn the basics by taking a free Virtual Small Business Tax Workshop.
Business.gov Business.gov guides you through the maze of government rules and regulations and provides access
to services and resources to help you start, grow, and succeed in business.
Health insurance
COBRA Health Insurance
Workers who lose their jobs may qualify for a 65% reduction in health insurance premiums for up to 15 months.
Health Coverage Tax Credit - Trade-affected workers and PBGC payees receive an 80% credit for health
insurance premiums.
Other Resources
Publication 908, Bankruptcy Tax Guide
Canceled Debt – Is it Taxable or Not?
Publication 4705, Overview: Mortgage Debt Forgiveness
Publication 4705(SP), Overview: Mortgage Debt Forgiveness (Spanish version)
Bartering Income Bartering for goods or services? Know the rules.

4. Payment Plans, Installment Agreements
Whether you call it an installment agreement, payment agreement, payment option or a payment plan, the idea
is the same — you make payments on the tax you owe. That sounds like a good deal, but you can save money
by paying the full amount you owe as quickly as possible to minimize the interest and penalties you’ll be
charged. For those who cannot resolve their tax debt immediately, however, an installment agreement can be a
reasonable payment option. Installment agreements allow for the full payment of the tax debt in smaller, more
manageable amounts.
Frequently Asked Questions about Installment Agreements/Payment Plans
• How can I save money by paying my taxes?
• If I recently filed my income tax return and owe but have NOT yet received a bill from the IRS,
can I set up an installment agreement?
• How do I set up an installment agreement/payment plan?
• Are there fees associated with setting up an agreement?
• What is the best way to make timely installment payments?
• What happens if I miss a payment?
• Will a notice of federal tax lien be filed?
• Can I combine other tax balances owed on my new installment agreement?
• Will I still get my tax refunds?
How to Set Up an Installment Agreement
Taxpayers wishing to pay off a tax debt through an installment agreement, and owe:
• $25,000 or less in combined tax, penalties, and interest can use the Online Payment
Agreement (OPA) or call the number on the bill or notice (have the bill or notice available,
along with the social security number). A fill-in Request for Installment Agreement, Form
9465 (PDF), is available online that can be mailed to the address on the bill.
Note: If you recently filed your income tax return and owe but have NOT yet received a bill
from the IRS, you can use the Online Payment Agreement to establish an installment
agreement on current year returns. To determine the information needed to establish a pre-
assessed installment agreement, refer to What Information Do I Need to Use OPA?
• More than $25,000 in combined tax, penalties, and interest may still qualify for an installment
agreement, but a Collection Information Statement, Form 433F (PDF) may need to be
completed. Call the number on the bill or mail the Request for Installment Agreement, Form
9465 (PDF) and Form 433F (PDF) to the address on the bill.
You will receive a written notification telling you whether your terms for an installment agreement have been
accepted or if they need to be modified.
References/Related Topics
• Filing Late and/or Paying Late: Information You Should Know
• Haven't Filed a Tax Return? Here's What to Do
• It’s Important to Pay Taxes in Full
• Receiving a Bill From the IRS
• Meeting the Terms of an Installment Agreement
• Collection Financial Standards and Necessary Expenses
• FAQs - Installment Agreement/Payment Plan

5. What if my income declines?
There are many tax credits that are subject to income limitations. If you had a reduction in income this year you
may be eligible for some credits or deductions. For example, the Earned Income Tax Credit is available for
working families and individuals. Eligibility is determined by income and family size. You must file an income
tax return in order to claim EITC. See 1040 Central for more information on EITC, other tax credits and tax law
changes.

6. Identity Theft and Your Tax Records
The IRS does not initiate communication with taxpayers through e-mail. Before identity theft happens,
safeguard your information.
What do I do if the IRS contacts me because of a tax issue that may have been created by an identity
theft?
If you receive a notice or letter in the mail from the IRS that leads you to believe someone may have used
your Social Security number fraudulently, please respond immediately to the name, address, and/or number
printed on the IRS notice.
Be alert to possible identity theft if the IRS issued notice or letter:
• states more than one tax return was filed for you, or
• indicates you received wages from an employer unknown to you.
An identity thief might also use your Social Security number to file a tax return in order to receive a refund. If
the thief files the tax return before you do, the IRS will believe you already filed and received your refund if
eligible.
If your Social Security number is stolen, it may be used by another individual to get a job. That person’s
employer would report income earned to the IRS using your Social Security number, making it appear that you
did not report all of your income on your tax return.
If you have previously been in contact with the IRS and have not achieved a resolution, please contact the IRS
Identity Protection Specialized Unit, toll-free at 1-800-908-4490.
What do I do if I have not been contacted by IRS for a tax issue but believe I am a victim of identity
theft?
If your tax records are not currently affected by identity theft, but you believe your IRS records may be at risk
due to a lost/stolen purse or wallet, questionable credit card activity, credit report, or other activity, you need to
provide the IRS with proof of your identity.
You should submit a copy, not the original documents, of your valid Federal or State issued identification,
such as a social security card, driver's license, or passport, etc, along with a copy of a police report and/or a
completed IRS Identity Theft Affidavit - Form 14039. Please send these documents using one of the following
options:
Mailing address:
Internal Revenue Service
P.O. Box 9039
Andover, MA 01810-0939
FAX: Note that this is not a toll-free FAX number
1-978-247-9965
You may also contact the IRS Identity Protection Specialized Unit, toll-free 1-800-908-4490 for resource
information and guidance.
Hours of Operation: Monday – Friday, 8:00 a.m. – 8:00 p.m. your local time (Alaska & Hawaii follow Pacific
Time).

7. What do you do if you receive a paper letter or notice via mail claiming to be the IRS but you suspect it is
a scam?
1. Contact the IRS to determine if it is a legitimate IRS notice or letter.
2. If it is a legitimate IRS notice or letter, reply if needed.
3. If caller or party that sent the paper letter is not legitimate, contact the Treasury Inspector General for
Tax Administration at 1-800-366-4484. You may also fax the notice/letter you received plus any related
or supporting information to TIGTA. Note that this is not a toll-free FAX number 1-202-927-7018.
Helpful IRS Publications
• Publication 4535, Identity Theft Protection and Victim Assistance
• Publication 4524, Security Awareness-Identity Theft Flyer
• Publication 4523, Beware of Phishing Schemes
Additional IRS.gov resources
• Top 10 Things Every Taxpayer Should Know about Identity Theft
• How to report and identify phishing, e-mail scams and bogus IRS Web sites.
• If you have tried to resolve a tax problem with the IRS and are still experiencing economic harm, you
may be eligible for Taxpayer Advocate Service assistance.
• Internal Revenue Manual 10.5.3 (Identity Protection Program) - Procedural guidance on issues related to
identity theft
• If you do not prepare your own return, be careful in choosing your tax preparer.
• Repository of IRS messages related to suspicious e-mails and identity theft.
• Having trouble downloading or viewing a PDF?
IRS Partner resources
The IRS partners with the Federal Trade Commission, SSA and other federal agencies to combat identity theft
and educate taxpayers on how to protect themselves.
• OnGuardOnline.gov Urges Taxpayers to Contact the IRS If They Suspect Tax-Related Identity Theft
• Social Security Administration: Actions to take in the case of identity theft
• Internet Crime Complaint Center (IC3) is a partnership between the Federal Bureau of Investigation,
the National White Collar Crime Center, and the Bureau of Justice Assistance.
Remember:
The IRS does not initiate communication with taxpayers through e-mail.

8. More Taxpayers Are Filing From Home in 2011, Free File Options Abound
IR-2011-24, March 4, 2011
WASHINGTON — Almost 19 million tax returns have been filed with the IRS from home computers so far
this year, an increase of almost 6 percent compared to the number of returns from the same time last year.
IRS reminds taxpayers that everyone can use Free File to prepare and e-file their tax returns for free, either by
using brand name software or Free File Fillable Forms, which is the electronic version of IRS paper forms.
Individuals or families with 2010 adjusted gross incomes of $58,000 or less can use Free File software. Using
Free File Fillable Forms has no income restrictions.
Free File software is a product of a public-private partnership between the IRS and the Free File Alliance, LLC.
The Alliance is a consortium of approximately 20 tax software providers who make versions of their products
available exclusively on line. All Free File members must meet certain security requirements and use the latest
in encryption technology to protect taxpayers’ information.
The easiest way to locate a software provider is to use the online tool that, with a little of a taxpayer’s personal
information, can identify matching products. Or, taxpayers can review all providers and their offers. Some
software providers also offer state income tax preparation for free or for a fee.
This is the third year that the Free File Alliance has provided the Free Fillable Forms program, which is like
completing a Form 1040 online, except the program performs some math calculations and provides links to
some IRS publications. However, it does not use the familiar question-and-answer format used by tax
preparation software. It also does not support state income tax returns. Taxpayers can e-file the forms for free.
Taxpayers must access the tax products through IRS.gov to avoid any charges for preparing or e-filing a federal
tax return.
The total number of individual income tax returns that have been e-filed this year is 46.9 million, an increase of
2 percent from the same time last year. E-file includes both returns filed from home computers and returns e-
filed by professional tax return preparers.
2011 FILING SEASON STATISTICS
Cumulative through the weeks ending 02/26/10 and 02/25/11
Individual Income Tax Returns 2010 2011 % Change
Total Receipts 53,556,000 51,927,000 -3.0%
Total Processed 49,751,000 49,278,000 -1.0%
E-filing Receipts:
TOTAL 45,873,000 46,868,000 2.2%
Tax Professionals 28,048,000 27,983,000 -0.2%
Self-prepared 17,826,000 18,885,000 5.9%

9. Web Usage:
Visits to IRS.gov 98,691,224 107,028,830 8.5
Total Refunds:
Number 45,544,000 45,077,000 -1.0%
Amount $143.417 Billion $141.054 Billion -1.6%
Average refund $3,149 $3,129 -0.6%
Direct Deposit Refunds:
Number 39,569,000 39,821,000 0.6%
Amount $130.774 Billion $129.684 Billion -0.8%
Average refund $3,305 $3,257 -1.5%

10. Order a Transcript
• Tax Return Transcript • Social Security Number (or • Go to Order a Transcript, or
provides most your IRS individual taxpayer
line items from your original identification number); • Call 1-800-908-9946
return.
• Date of birth;
• Tax Account Transcript
provides • Street address; and
basic info, including marital
status, • Zip Code or Postal Code.
type of return filed, AGI,
taxable income, and later
adjustments, if any.
Note: We cannot process your request online if you need transcripts mailed to an address other than the one
we have on file for you. To send your transcript to a different address, complete and send Form 4506-T or call
us at 1-800-829-1040

11. Second Special Voluntary Disclosure Initiative Opens; Those Hiding Assets Offshore Face
Aug. 31 deadline
Update June 10, 2011 — Updated information is available on the main offshore voluntary disclosure and
Frequently Asked Questions pages.
IR-2011-14, Feb. 8, 2011
WASHINGTON — The Internal Revenue Service announced today a special voluntary disclosure initiative
designed to bring offshore money back into the U.S. tax system and help people with undisclosed income from
hidden offshore accounts get current with their taxes. The new voluntary disclosure initiative will be available
through Aug. 31, 2011.
“As we continue to amass more information and pursue more people internationally, the risk to individuals
hiding assets offshore is increasing,” said IRS Commissioner Doug Shulman. “This new effort gives those
hiding money in foreign accounts a tough, fair way to resolve their tax problems once and for all. And it gives
people a chance to come in before we find them.”
The IRS decision to open a second special disclosure initiative follows continuing interest from taxpayers with
foreign accounts. The first special voluntary disclosure program closed with 15,000 voluntary disclosures on
Oct. 15, 2009. Since that time, more than 3,000 taxpayers have come forward to the IRS with bank accounts
from around the world. These taxpayers will also be eligible to take advantage of the special provisions of the
new initiative.
“As I’ve said all along, the goal is to get people back into the U.S. tax system,” Shulman said. “Combating
international tax evasion is a top priority for the IRS. We have additional cases and banks under review. The
situation will just get worse in the months ahead for those hiding assets and income offshore. This new
disclosure initiative is the last, best chance for people to get back into the system.”
The new initiative announced today – called the 2011 Offshore Voluntary Disclosure Initiative (OVDI) --
includes several changes from the 2009 Offshore Voluntary Disclosure Program (OVDP). The overall penalty
structure for 2011 is higher, meaning that people who did not come in through the 2009 voluntary disclosure
program will not be rewarded for waiting. However, the 2011 initiative does add new features.
For the 2011 initiative, there is a new penalty framework that requires individuals to pay a penalty of 25 percent
of the amount in the foreign bank accounts in the year with the highest aggregate account balance covering the
2003 to 2010 time period. Some taxpayers will be eligible for 5 or 12.5 percent penalties. Participants also must
pay back-taxes and interest for up to eight years as well as paying accuracy-related and/or delinquency
penalties.
Taxpayers participating in the new initiative must file all original and amended tax returns and include payment
for taxes, interest and accuracy-related penalties by the Aug. 31 deadline.

12. The IRS is also making other modifications to the 2011 disclosure initiative.
Participants face a 25 percent penalty, but taxpayers in limited situations can qualify for a 5 percent penalty.
The IRS also created a new penalty category of 12.5 percent for treating smaller offshore accounts. People
whose offshore accounts or assets did not surpass $75,000 in any calendar year covered by the 2011 initiative
will qualify for this lower rate.
The 2011 initiative offers clear benefits to encourage taxpayers to come in now rather than risk IRS detection.
Taxpayers hiding assets offshore who do not come forward will face far higher penalty scenarios as well as the
possibility of criminal prosecution.
“This is a fair offer for people with offshore accounts who want to get right with the nation’s taxpayers,”
Shulman said. “This initiative offers them the chance to get certainty about how their case will be handled. Just
as importantly, those who truly come in voluntarily can avoid criminal prosecution as well.”
The IRS is handling processing of the voluntary disclosures in centralized units to more efficiently process the
applications.
The IRS has launched a new section on www.IRS.gov that includes the full terms and conditions on the 2011
Offshore Voluntary Disclosure Initiative, including an extensive set of questions and answers to help taxpayers
and tax professionals. The web site also includes details on how people can make a voluntary disclosure.
In the first voluntary disclosure program in 2009, taxpayers faced up to a 20 percent penalty covering up to a
six-year period. Taxpayers came forward with about 15,000 voluntary disclosures in that effort covering banks
in more than 60 countries.
Shulman said IRS efforts in the international arena will only increase as time goes on.
“Tax secrecy continues to erode,” Shulman said. “We are not letting up on international tax issues, and more is
in the works. For those hiding cash or assets offshore, the time to come in is now. The risk of being caught will
only increase.”

13. Affordable Care Act Tax Provisions
The Affordable Care Act was enacted on March 23, 2010. It contains some tax provisions that take effect this
year and more that will be implemented during the next several years. The following is a list of provisions now
in effect; additional information will be added to this page as it becomes available.
Small Business Health Care Tax Credit
This new credit helps small businesses and small tax-exempt organizations afford the cost of covering their
employees and is specifically targeted for those with low- and moderate-income workers. The credit is
designed to encourage small employers to offer health insurance coverage for the first time or maintain
coverage they already have. In general, the credit is available to small employers that pay at least half the cost
of single coverage for their employees. Learn more by browsing our page on the Small Business Health Care
Tax Credit for Small Employers.
Changes to Flexible Spending Arrangements
Effective Jan. 1, 2011, the cost of an over-the-counter medicine or drug cannot be reimbursed from Flexible
Spending Arrangements or health reimbursement arrangements unless a prescription is obtained. The change
does not affect insulin, even if purchased without a prescription, or other health care expenses such as medical
devices, eye glasses, contact lenses, co-pays and deductibles. The new standard applies only to purchases made
on or after Jan. 1, 2011, so claims for medicines or drugs purchased without a prescription in 2010 can still be
reimbursed in 2011, if allowed by the employer’s plan. A similar rule goes into effect on Jan. 1, 2011 for
Health Savings Accounts (HSAs), and Archer Medical Savings Accounts (Archer MSAs). Employers and
employees should take these changes into account as they make health benefit decisions for 2011.
For more information, see news release IR-2010-95, Notice 2010-59, Revenue Ruling 2010-23 and our
questions and answers.
FSA and HRA participants can continue using debit cards to buy prescribed over-the-counter medicines, if
requirements are met. For more information, see news release IR-2010-128 and Notice 2011-5.
IRS partners can spread the word to their clients with the help of a Health Plan Changes flyer and a drop-in
article, Does your Healthcare Program need a checkup?
Health Coverage for Older Children
Health coverage for an employee's children under 27 years of age is now generally tax-free to the employee.
This expanded health care tax benefit applies to various work place and retiree health plans. These changes
immediately allow employers with cafeteria plans –– plans that allow employees to choose from a menu of
tax-free benefit options and cash or taxable benefits –– to permit employees to begin making pre-tax
contributions to pay for this expanded benefit. This also applies to self-employed individuals who qualify for
the self-employed health insurance deduction on their federal income tax return. Learn more by reading our
news release or this notice.

14. Excise Tax on Indoor Tanning Services — First Quarterly Payment Was Due Nov. 1, 2010
A 10-percent excise tax on indoor UV tanning services went into effect on July 1, 2010. The first
payment of the tax was due Monday, Nov. 1. Payments are made along with Form 720, Quarterly
Federal Excise Tax Return. The tax doesn't apply to phototherapy services performed by a licensed
medical professional on his or her premises. There's also an exception for certain physical fitness
facilities that offer tanning as an incidental service to members without a separately identifiable fee.
For more information on the tax and how it will be administered, see our news release, video,
webinar, questions and answers and legal guidance.
Employer-Provided Health Coverage — Not Taxable; Reporting is Voluntary for All Employers for
2011 and Small Employers for 2012
Starting in tax year 2011, the Affordable Care Act requires employers to report the cost of coverage under an
employer-sponsored group health plan. To give employers more time to update their payroll systems, Notice
2010-69, issued last fall, made this requirement optional for all employers in 2011. IRS Notice 2011-28
provided further relief for smaller employers filing fewer than 250 W-2 forms by making the reporting
requirement optional for them at least for 2012 and continuing this optional treatment for smaller employers
until further guidance is issued. Notice 2011-28 also includes information on how to report, what coverage to
include and how to determine the cost of the coverage.
The 2011 Form W-2 is available for viewing on IRS.gov. This is the W-2 that most employees will receive in
early 2012. The form includes the codes that employers may use to report the cost of coverage under an
employer-sponsored group health plan.
This reporting is for informational purposes only, to show employees the value of their health care benefits so
they can be more informed consumers. The amount reported does not affect tax liability, as the value of the
employer contribution to health coverage continues to be excludible from an employee's income, and it is not
taxable.
For more information, see the 2011 Form W-2, IR-2011-31, Notice 2010-69, Notice 2011-28 and our IRS
YouTube video and frequently asked questions.
Adoption Credit
The Affordable Care Act raises the maximum adoption credit to $13,170 per child, up from $12,150
in 2009. It also makes the credit refundable, meaning that eligible taxpayers can get it even if they
owe no tax for that year. In general, the credit is based on the reasonable and necessary expenses
related to a legal adoption, including adoption fees, court costs, attorney’s fees and travel expenses.
Income limits and other special rules apply. In addition to filling out Form 8839, Qualified Adoption
Expenses (see instructions), eligible taxpayers must include with their 2010 tax returns one or more
adoption-related documents to avoid slowing down a refund.
For other information, see our news release, tax tip, questions and answers, flyer, Notice 2010-66,
Revenue Procedure 2010-31 and Revenue Procedure 2010-35.
Medicare Shared Savings Program
The Affordable Care Act establishes a Medicare shared savings program (MSSP) which encourages
Accountable Care Organizations (ACOs) to facilitate cooperation among providers to improve the quality of
care provided to Medicare beneficiaries and reduce unnecessary costs. More information can be found in

15. Notice 2011-20, which solicits written comments regarding what additional guidance, if any, is needed for tax-
exempt organizations participating in the MSSP through an ACO. This guidance also addresses the
participation of tax-exempt organizations in non-MSSP activities through ACOs. Comments must be
submitted by May 31, 2011. Additional information on the MSSP is available on the Department of Health and
Human Services website.
Qualified Therapeutic Discovery Project Program
This program was designed to provide tax credits and grants to small firms that show significant potential to
produce new and cost-saving therapies, support U.S. jobs and increase U.S. competitiveness. Applicants were
required to have their research projects certified as eligible for the credit or grant. IRS guidance describes the
application process.
Submission of certification applications began June 21, 2010, and applications had to be postmarked no later
than July 21, 2010, to be considered for the program. Applications that were postmarked by July 21, 2010,
were reviewed by both the Department of Health and Human Services (HHS) and the IRS. All applicants were
notified by letter dated October 29, 2010, advising whether or not the application for certification was
approved. For those applications that were approved, the letter also provided the amount of the grant to be
awarded or the tax credit the applicant was eligible to take.
The IRS published the names of the applicants whose projects were approved as required by law. Listings of
results are available by state.
Learn more by reading the IRS news release, the news release issued by the U.S. Department of the Treasury,
the page on the HHS website and our questions and answers.
Group Health Plan Requirements
The Affordable Care Act establishes a number of new requirements for group health plans. Interim guidance
on changes to the nondiscrimination requirements for group health plans can be found in Notice 2011-1, which
provides that employers will not be subject to penalties until after additional guidance is issued. Other
information on requirements is available on the websites of the Departments of Health and Human
Services and Labor and in additional guidance.
Tax-Exempt 501(c)(29) Qualified Nonprofit Health Insurance Issuers
The Affordable Care Act requires the Department of Health and Human Services (HHS) to establish the
Consumer Operated and Oriented Plan program (CO-OP program). It also provides for tax exemption under
section 501(c)(29) for recipients of CO-OP grants and loans that meet additional requirements. IRS Notice
2011-23 outlines the requirements for tax exemption under under section 501(c)(29) and solicits written
comments regarding these requirements as well as the application process. Comments must be submitted by
May 27, 2011.
An overview of the CO-OP program is available on the Department of Health and Human Services website.
Medicare Part D Coverage Gap “donut hole” Rebate
The Affordable Care Act provides a one-time $250 rebate in 2010 to assist Medicare Part D recipients who
have reached their Medicare drug plan’s coverage gap. This payment is not taxable. This payment is not made
by the IRS. More information can be found at www.medicare.gov.

16. Additional Requirements for Tax-Exempt Hospitals
The Affordable Care Act adds requirements in the Internal Revenue Code that tax-exempt hospitals must meet
to maintain their tax-exempt status. IRS Notice 2010-39 described the new requirements and solicited public
comments. Due to changes to IRS forms and systems to reflect the additional requirements for charitable
hospitals, the start of the 2010 filing season for hospital organizations is delayed. Tax-exempt organizations
that are required to file Form 990, Schedule H (Hospitals), may not file their 2010 Forms 990 before July 1,
2011. Furthermore, IRS Announcement 2011-37 advises hospital organizations that Part V, Section B of
Schedule H is optional for the 2010 tax year. The 2010 Form 990 and Schedule H include new questions
relating to the new requirements that are in effect for tax years beginning after March 23, 2010, addressing the
financial assistance, emergency medical care, billing and collection policies and charges for medical care.
Annual Fee on Branded Prescription Pharmaceutical Manufacturers and Importers
The Affordable Care Act created an annual fee payable beginning in 2011 by certain manufacturers and
importers of brand name pharmaceuticals. More information can be found in Notice 2010-71 and Notice 2011-
9, which provide proposed guidance and solicit comments on the new fee, and on Form 8947, Report of
Branded Prescription Drug Information.
Revenue Procedure 2011-24, establishes a dispute resolution process for the preliminary fee calculation for the
2011 annual fee. The revenue procedure provides guidance on what information needs to be submitted
regarding an asserted error, in what format the information must be submitted, who may submit the
information and the deadline for submitting the information. Notice 2011-46 extends the deadline for
submitting error reports as part of the dispute resolution process.
Modification of Section 833 Treatment of Certain Health Organizations
The Affordable Care Act amended section 833 of the Code, which provides special rules for the taxation of
Blue Cross and Blue Shield organizations and certain other organizations that provide health
insurance. Guidance can be found in Notice 2011-04, which provides procedures for a taxpayer to obtain
automatic consent to change its method of accounting for unearned premiums, and Notice 2011-51, which
extends interim guidance on modification of Section 833 treatment of certain health organizations.
Limitation on Deduction for Compensation Paid by Certain Health Insurance Providers
The Affordable Care Act amended section 162(m) of the Code to limit the compensation deduction available
to certain health insurance providers. The amendment goes into effect for taxable years beginning after Dec.
31, 2012, but may affect deferred compensation attributable to services performed in a taxable year beginning
after Dec. 31, 2009. Initial guidance on the application of this provision can be found in Notice 2011-2, which
also solicits comments on the application of the amended provision.
Employer Shared Responsibility Payment
Starting in 2014, certain employers must offer health coverage to their full-time employees or a shared
responsibility payment may apply. More information and a request for comments on approaches to
determining who is a full-time employee for purposes of this new provision are in Notice 2011-36. Learn more
by reading our news release.

17. Patient-Centered Outcomes Research Institute
The Affordable Care Act establishes the Patient-Centered Outcomes Research Institute and that the institute be
funded by the Patient-Centered Outcomes Research Trust Fund. The institute will assist patients, clinicians,
purchasers, and policy-makers in making informed health decisions by advancing clinical effectiveness
research. The Trust Fund is to be funded in part by fees to be paid by issuers of health insurance policies and
sponsors of self-insured health plans. IRS Notice 2011-35 requests comments regarding how the fees to fund
the institute should be calculated and paid, including several possible rules and safe harbors.
For More Information
For tips, fact sheets, questions and answers, videos and more, see our Affordable Care Act of 2010: News
Releases, Multimedia and Legal Guidance page.

18. The “What Ifs” of an Economic Downturn
The Internal Revenue Service recognizes that many people may be having difficult times financially.
There can be a tax impact to events such as job loss, debt forgiveness or tapping a retirement fund. If
your income decreased, you may be newly eligible for certain tax credits, such as the
Earned Income Tax Credit.
Most importantly, if you believe you may have trouble paying your tax bill contact the IRS immediately.
There are steps we can take to help ease the burden. You also should file a tax return even if you are
unable to pay so you can avoid additional penalties.
Here are some “What if” scenarios and the possible tax impact:
Job Related
What if I lose my job?
What if I receive unemployment compensation?
What if my income declines?
What if I am searching for a job?
What if my employer goes out of business?
What if I close my own business?
What if I withdraw money from my IRA?
What if my 401(k) drops in value?
Debt Related
What if I lose my home through foreclosure?
What if I sell my home for a loss?
What if my debt is forgiven?
What if I am insolvent?
What if I file for bankruptcy protection?
Tax Related
What if I can’t pay my taxes?
What if I can’t pay my installment agreement?
What if there is a federal tax lien on my home?
What if a levy on my wages is creating hardship?
What if I can’t resolve my tax problem with the IRS?
What if I need legal representation to help with my tax problem but can’t afford it?
Related Items:
Tax Tip 2011-68, Three Ways to Pay Your Federal Income Tax
• Special Edition Tax Tip, IRS Help for Financially Distressed Taxpayers
• IR-2011-42, April 18 Deadline Approaching; Check IRS Payment Options
• IR-2011-20, IRS Announces New Effort to Help Struggling Taxpayers Get a Fresh Start; Major
Changes Made to Lien Process
• IR-2010-29, IRS Outlines Additional Steps to Assist Unemployed Taxpayers and Others
• Payment Plans, Installment Agreements
• Offers in Compromise
• Tax Center to Assist Unemployed Taxpayers
• Publication 4763, Job Related Questions During an Economic Downturn
GO TO WWW.IRS.GOV
AND TYPE IN THE SEARCH ENGINE:
THE WHAT IFS OF AN ECONOMIC DOWNTURN

19. Tax Impact
of
Job Loss
Publication 4128 (Rev. 5-2011) Catalog Number 35359Q
Department of the Treasury Internal Revenue Service www.irs.gov

20. Facts
JOB LOSS CREATES TAX ISSUES
The Internal Revenue Service recognizes that the loss of a job may create new tax
issues. The IRS provides the following information to assist displaced workers.
Severance pay and unemployment compensation are taxable. Payments for
any accumulated vacation or sick time are also taxable. You should ensure that
enough taxes are withheld from these payments or make estimated payments.
See IRS Publication 17, Your Federal Income Tax, for more information.
Generally, withdrawals from your pension plan are taxable unless they are
transferred to a qualified plan (such as an IRA). If you are under age 59 1⁄2,
an additional tax may apply to the taxable portion of your pension. See IRS
Publication 575, Pension and Annuity Income, for more information.
Certain expenses incurred while looking for a new job may be deductible.
Examples of deductible expenses include employment and outplacement agency
fees, resume preparation, and travel expenses for job search and interviews. See
IRS Publication 17, Your Federal Income Tax, for more information.
Moving costs you incur because of a change in your job location may be
deductible. You must meet certain criteria relating to distance moved and timing of
the move. See IRS Publication 521, Moving Expenses, for more information.
Some displaced workers may decide to start their own business. The IRS provides
information and classes for new business owners. Please visit www.irs.gov or see
IRS Publication 334, Tax Guide for Small Businesses, for more information.
Copies of all publications are available at www.irs.gov. You may also request a copy by
calling 1-800-829-3676.
1

21. Q&A
JOB LOSS: What Income is Taxable?
The following Questions and Answers are provided by the Internal Revenue Service to clarify the tax
implications of financial issues faced by workers who have lost their jobs. References are provided for
additional information.
Is Severance Pay taxable?
Yes, severance pay is taxable in the year that you receive it. Your employer will include this amount on
your Form W-2 and will withhold appropriate federal and state taxes. See Publication 525 for additional
information.
What about Accumulated Leave or Vacation Pay and Sick Pay?
Yes, annual, or vacation pay, and sick pay are calculated as wages by your employer and will be included
in your Form W-2.
Is Unemployment Compensation taxable?
Yes, your state unemployment insurance benefits (up to 26 weeks) and your extended benefits (up to an
additional 13 weeks) are taxable. You may choose to have 10% withheld for federal taxes by completing
Form W-4V. The State will provide you with a Form 1099-G prior to January 31st of each year, showing
the amount of taxable benefits paid in the prior year. See Publication 525 for additional information.
What about Gifts of Cash and Property from Family or Friends?
Generally, the person who receives the gift is not liable for any taxes on the gift. If the gift produces
income like interest, dividends or rent payments, the receiver would be responsible for taxes on that
produced income. Each year there is a specific maximum amount that may be given that will not create
a taxable event to either the giver or the receiver. Gifts in excess of this maximum may be subject to gift
taxes by the gift giver. See Publications 17 or Instructions to Form 709, United States Gift Tax Return, for
additional information.
If I am eligible for Public Assistance or Food Stamps, is it taxable? No.
When will I get my final Form W-2 from my employer?
Your employer must provide your Form W-2 by January 31st after the close of the calendar year. As an
example, 2011 Forms W-2 are due to employees by January 31, 2012.
What if my employer filed bankruptcy or went out of business, how do I get my Form W-2?
In either case the employer must file and report your wages and withholding on a Form W-2 at year’s
end. If you do not receive your Form W-2, try to contact your employer or their representative. If you are
unsuccessful, the IRS can assist you in filing a substitute Form W-2 using your records. A good precaution
is to keep year-to-date records or pay stubs until you receive your Form W-2.
Can I file an early tax return and receive any refund due?
No. Individual income tax returns are based on a calendar year and cannot be filed and processed earlier
than January 1st of the next calendar year.
If I sell other assets like stocks, bonds, and investment property, are they immediately taxable?
Not necessarily, however the sale of such assets should be reported. If you have a gain on the sale, it may
generate an income tax liability. You should review your overall tax situation and make sure you have paid
your taxes as required to avoid any estimated tax penalty. Information on estimated tax is in Publication
505.
2

22. Q&A
JOB LOSS: What Income is Taxable? (continued)
What can I do if I owe taxes and cannot pay them?
Contact the Internal Revenue Service as soon as possible to request a payment plan. Communication is
the key to minimizing problems.
Go to www.irs.gov for more information on payment methods and balance due payment options or you
can call the IRS at 1-800-829-1040.
Is special assistance available on unresolved tax matters that create hardships?
Yes, if you are experiencing economic harm, a systemic problem or are seeking help in resolving tax
problems that have not been resolved through normal channels, you may be eligible for Taxpayer
Advocate Services (TAS) assistance. You can reach TAS by calling toll-free 1-877-777-4778 or TTY/TTD
1-800-829-4059.
Copies of the referenced publications can be found at www.irs.gov, or you may call 1-800-829-3676.
3

23. Q&A
JOB LOSS: Pensions/IRAs – What’s Next?
The following Questions and Answers are provided by the Internal Revenue Service to help you handle
financial issues with a tax impact which may arise if you lose your job.
What if I withdraw money from my qualified retirement plan or IRA?
Generally speaking, if you withdraw the funds before you reach eligible age, and do not roll it over into
another qualified retirement plan or Individual Retirement Account (IRA) within 60 days, that amount will
be taxable income in the year in which it is withdrawn. You may also have to pay an additional 10% tax
on those early distributions. There are special rules for computing tax on lump-sum distributions. See IRS
Publication 17 or Publication 575 for detailed information.
Can I move money from my qualified retirement plan into another qualified retirement plan or IRA?
Yes, this is called a “rollover” and the amount will not be taxed if you redeposit the amount withdrawn
into another qualified retirement plan or traditional IRA within 60 days. See Publication 575 for additional
information.
Are there any “hardship” exceptions to the early distribution penalties?
Yes. If you are totally and permanently disabled or if you withdraw the money to pay medical expenses
(these expenses must be more than 7.5% of your adjusted gross income) or to pay an alternate payee
under a qualified domestic relations order. Other specific exceptions are detailed in Publication 575.
If I made an IRA contribution during the current tax year, can I withdraw it before the close of the
year?
Yes. Contributions returned before the due date of the return can be withdrawn without penalty. You must
take not only the contribution but any interest or dividend it may have earned. This is a tax-free event
if (1) you do not take a deduction for the contribution and (2) you withdraw any income or interest the
investment made while in the IRA and include that amount in your income. See Publication 590, Individual
Retirement Arrangements for more information.
I’ve had my IRAs for several years, in some of those years I didn’t benefit from any deduction due
to my income. How do I figure what part of the distribution is taxable?
If you had non-deductible IRA contributions, you would have completed Form 8606 to establish your
basis (cost) in your combined IRAs. Use the worksheet in Publication 590 to calculate what part of the
distribution is taxable and complete Part I on Form 8606 and attach it to your return.
If I take my pension and want to transfer it to an IRA, are there any special rules or restrictions?
Rolling over your pension distribution to a financial institution: (i.e., bank, credit union, brokerage house,
etc.) is straightforward. There are some prohibited transactions including borrowing the distribution even
with a signed contract with interest due, receiving unreasonable compensation for managing these funds,
buying property for personal use (present or future), or using the distribution as security for a loan. Review
the information in Publications 575 and 590 for additional information.
In addition to the Publications 17, 575 and 590, take advantage of every resource including your financial
and/or tax advisor before deciding how to proceed in transitioning your retirement funds. Copies of the
referenced publications can be found at www.irs.gov or you may call 1-800-829-3676.
4

24. Q&A
JOB LOSS: Starting Your Own Business
Every new phase of life brings many challenges. The Internal Revenue Service recognizes that the loss
of a job can create new tax situations for you. The following information is provided to clarify possible tax
implications.
Can I be an Employee and a Business Owner in the same tax year?
Yes. Under the tax law, you can be both an Employee and a Business Owner at the same time if you
choose. The primary issue is to report all income on your return.
Where can I get information about starting my own business?
Publication 334, Tax Guide for Small Business, Publication 583, Starting a Business and Keeping Records
are free publications that have helpful information for small business owners. In addition, Publication
4591, Small Business Tax Responsibilities, provides a summary of the reference material for the business
owner. These products contain information on starting your own business, record keeping, and deductible
expenses.
What options do I have for organizing my business?
Under the federal tax code, there are three options: Sole Proprietorship, Partnership or Corporation. A
number of factors may influence your decision about which structure is best for you including cost of start-
up, exposure to risk or liability, financing and the tax implications.
What record keeping requirements do I have as a Sole Proprietor?
Generally, you should keep detailed records of your income and expenses for your business to prepare
not only required tax returns but also financial statements to help in maintaining and growing your
business. The same general rules apply for Partnerships and Corporations with some additional detail.
How do I report my business income?
As a Sole Proprietor, you will need to file a Form 1040, Schedule C or C-EZ and Schedule SE. For more
information, please see Publication 334, Tax Guide for Small Business.
What kinds of taxes do I pay as a Sole Proprietor?
Taxes due on net self-employment income (total business income minus expenses) include income
tax and self-employment (Social Security and Medicare) taxes. Additional information is available in
Publication 334, Tax Guide for Small Businesses. You may be responsible for Employment Taxes if you
have employees working in your business, see Publication 15, Circular E, Employer’s Tax Guide for
details.
How do I pay my taxes as a Sole Proprietor?
Generally, you would pay using the 1040ES Estimated Tax process on a quarterly basis. Federal income
taxes including Self-Employment tax use a pay-as-you-go system. You generally must make estimated tax
payments if you expect to owe taxes of $1,000 or more when you file your return. For more information on
Estimated Tax see Publication 505. Employment taxes are paid using Forms 941, Employer’s Quarterly
Federal Tax Return, and Form 940, Employer’s Annual Federal Unemployment Tax Return. The filing
requirements for each of these forms and instructions about how to pay taxes due are included in the
Publication 15, Circular E, Employer’s Tax Guide.
Can I claim the Earned Income Credit on my net self-employment income?
Yes, net income from a Sole Proprietorship is earned income and is one of the qualifications for earned
income credit. The Earned Income Credit is available to taxpayers that meet certain income guidelines.
See Publication 596, Earned Income Credit.
Are classes or seminars available to get additional information?
Yes. The Small Business/Self-Employed Division of the Internal Revenue Service has a number of Small
Business seminars through out the nation. You can also order Publication 1066C, A Virtual Small Business
Workshop DVD on the Small Business Web Site at www.irs.gov. Other products are available to order at
the Small Business Web Site as well.
5

25. Q&A
JOB LOSS: Miscellaneous Tax Information
Every new phase of life brings many challenges. The Internal Revenue Service recognizes that the loss
of a job can create new tax situations for you. The following information is provided to clarify the tax
implications.
Can I deduct any of the expenses that I have from looking for a new job?
Yes, you can deduct certain expenses for looking for a new job in your present occupation, even if you do
not get a new job. For additional information, see Publication 529, Miscellaneous Deductions.
What types of expenses can I include?
Generally, you can deduct employment and outplacement agency fees and amounts for typing, printing,
and mailing copies of your resume to prospective employers for work in your current occupation. More
specific information is available in Publication 529, Miscellaneous Deductions.
What about travel costs for interviews or job hunting?
If you travel to an area to look for work in your current occupation or attend an interview you can generally
deduct the ordinary and necessary travel costs. The purpose of the trip must be considered. Trips that are
primarily personal are not deductible. For more information on how to compute your travel expenses, see
Publication 463, Travel, Entertainment, Gifts and Car Expense.
Do I need to file the “long-form” to deduct my job hunting costs?
Yes, you will need to file a Form 1040 and Schedule A. Job hunting costs are a miscellaneous itemized
deduction, subject to a 2% Adjusted Gross Income limitation. For more information, please see
Publication 17, Your Federal Income Tax.
Can I deduct the moving costs I paid to move to my new job?
Certain moving costs are deductible if you meet the time and distance requirements. Generally, your
move has to be closely related in time to the start of your new job and you must have moved at least 50
miles. Deductible moving costs are calculated on Form 3903. Publication 521, Moving Expenses, provides
additional information.
If I sell my home, do I have to pay taxes on the money I make?
Usually you do not have to pay tax on the first $250,000 ($500,000 on a joint return in most cases) of gain
from the sale of your main home. Generally, you must have lived in and owned the home for at least two
years of the five years prior to the sale and not excluded a gain on another home in the past two years.
For more information, see Publication 523, Selling Your Home.
Now I have to pay the full cost for my health insurance. Is this deductible?
Health insurance premiums are includible in your medical and dental bills. They are deductible on
Schedule A, if you itemize. Some limitations apply. See Publication 502, Medical and Dental Expenses, for
more information.
Can I deduct contributions I made to a Health Savings Account (HSA)?
If you are an eligible individual, you can claim a tax deduction for contributions you, or someone other
than your employer, make to your HSA even if you do not itemize your deductions on Form 1040. For
more information see Pub 969, Health Savings Accounts and Other Tax-Favored Health Plans.
Can I claim the Earned Income Credit this year?
Even though your income may have exceeded the thresholds for this credit in past years, you may be
eligible for the credit this year. The credit is available to taxpayers who meet certain income guidelines. For
more information, see Publication 596, Earned Income Credit.
My chances of finding a new job will be better if I take a few college courses. Can I deduct any of
my tuition?
There are a number of tax benefits available for going to college or taking college courses. Some of the
benefits are credits and others are deductions from your income. Refer to Publication 970, Tax Benefits
for Education for more information.
Copies of the referenced publications can be found at www.irs.gov or you may call 1-800-829-3676.
6

26. How can you minimize becoming a victim? How can you protect your tax records?
Identity Theft Prevention • Don’t carry your Social Security card or any document(s) with If your tax records are not currently affected by identity theft, but
your SSN on it. you believe you may be at risk due to a lost/stolen purse or wallet,
And Victim Assistance
• Don’t give a business your SSN just because they ask - only when questionable credit card activity or credit report, etc., contact the
absolutely necessary. IRS Identity Protection Specialized Unit at 1-800-908-4490.
• Protect your financial information. What should you do if your tax records are affected
• Check your credit report every 12 months. by identity theft?
• Secure personal information in your home. If you receive a notice from IRS, respond immediately. If you
• Protect your personal computers by using firewalls, anti- believe someone may have used your SSN fraudulently, please
spam/virus software, update security patches, and change passwords notify IRS immediately by responding to the name and number
for Internet accounts. printed on the notice or letter.
• Don’t give personal information over the phone, through the mail
What if you receive an e-mail claiming to be from
or on the Internet unless you have initiated the contact or you are
the IRS?
sure you know who you are dealing with.
• Remember, the IRS does not initiate contact with taxpayers via e-
Remember, the IRS does not initiate contact with
mail, and the IRS does not request detailed personal information
taxpayers via e-mails, and the IRS does not
through e-mail.
request detailed personal information
• Confirm the contact you have received is from the IRS by calling
through e-mail.
1-800-829-1040.
What if you are a victim of identity theft? • Please forward the bogus e-mail claiming to be from the IRS to
• Report incidents of identity theft to the FTC phishing@irs.gov. Go to IRS.gov (keyword phishing) to get
Information from atwww.consumer.gov/idtheft or the FTC Identity Theft hotline at instructions on how to forward thee-mail message.
the Internal Revenue Service 1-877-438-4338 or TTY 1-866-653-4261. • Do not open attachments or click on the links found within the
• File a report with the local police. bogus e-mail.
• Contact the fraud departments of the three major credit bureaus:
For additional information, visit:
Equifax – www.equifax.com 1-800-525-6285
• IRS.gov (keyword identity theft)
Experian – www.experian.com 1-888-397-3742
While the Federal Trade Commission, the lead agency • IRS.gov (keyword phishing)
TransUnion – www.transunion.com 1-800-680-7289
on identity theft, reported that the IRS has a low number
• Close any accounts that have been tampered with or opened Federal Trade Commission, FTC
of identity theft crimes, we take this issue very seriously.
fraudulently.
What is identity theft?
How could identity theft impact your tax records?
Identity theft occurs when someone uses your personal
• Individuals may use your SSN to get a job. That person’s employer
information such as your name, Social Security number
would report the W-2 wages earned using your SSN to IRS. This
or other identifying information, without your permission, to
may give the appearance that you did not report all of your income
commit fraud or other crimes.
on your return.
Identity theft is a serious crime. People whose identities • When you subsequently file your tax return the IRS will believe
have been stolen can spend months or years, and their you already filed and received a refund, and the return you actually
hard earned money, cleaning up the mess thieves have submitted is a second copy or duplicate.
made of their good name and credit record. In the • Be alert to possible identity theft if you receive an IRS notice or
meantime, victims may lose job opportunities, be
letter that states that:
refused loans, education, housing or cars, or even get
• More than one tax return for you was filed, or
arrested for crimes they didn’t commit.
• IRS records indicate you received wages from an employer
unknown to you.

27. Form 4506-T Request for Transcript of Tax Return
(Rev. January 2011) OMB No. 1545-1872
Department of the Treasury Request may be rejected if the form is incomplete or illegible.
Internal Revenue Service
Tip. Use Form 4506-T to order a transcript or other return information free of charge. See the product list below. You can quickly request transcripts by using
our automated self-help service tools. Please visit us at IRS.gov and click on "Order a Transcript" or call 1-800-908-9946. If you need a copy of your return, use
Form 4506, Request for Copy of Tax Return. There is a fee to get a copy of your return.
1a Name shown on tax return. If a joint return, enter the name shown 1b First social security number on tax return, individual taxpayer identification
first. number, or employer identification number (see instructions)
2a If a joint return, enter spouse’s name shown on tax return. 2b Second social security number or individual taxpayer
identification number if joint tax return
3 Current name, address (including apt., room, or suite no.), city, state, and ZIP code (See instructions)
4 Previous address shown on the last return filed if different from line 3 (See instructions)
5 If the transcript or tax information is to be mailed to a third party (such as a mortgage company), enter the third party’s name, address,
and telephone number. The IRS has no control over what the third party does with the tax information.
Caution. If the transcript is being mailed to a third party, ensure that you have filled in line 6 and line 9 before signing. Sign and date the form once you
have filled in these lines. Completing these steps helps to protect your privacy.
6 Transcript requested. Enter the tax form number here (1040, 1065, 1120, etc.) and check the appropriate box below. Enter only one tax form
number per request.
a Return Transcript, which includes most of the line items of a tax return as filed with the IRS. A tax return transcript does not reflect
changes made to the account after the return is processed. Transcripts are only available for the following returns: Form 1040 series,
Form 1065, Form 1120, Form 1120A, Form 1120H, Form 1120L, and Form 1120S. Return transcripts are available for the current year
and returns processed during the prior 3 processing years. Most requests will be processed within 10 business days . . . . . .
b Account Transcript, which contains information on the financial status of the account, such as payments made on the account, penalty
assessments, and adjustments made by you or the IRS after the return was filed. Return information is limited to items such as tax liability
and estimated tax payments. Account transcripts are available for most returns. Most requests will be processed within 30 calendar days. .
c Record of Account, which is a combination of line item information and later adjustments to the account. Available for current year and
3 prior tax years. Most requests will be processed within 30 calendar days . . . . . . . . . . . . . . . . . . .
7 Verification of Nonfiling, which is proof from the IRS that you did not file a return for the year. Current year requests are only available
after June 15th. There are no availability restrictions on prior year requests. Most requests will be processed within 10 business days . .
8 Form W-2, Form 1099 series, Form 1098 series, or Form 5498 series transcript. The IRS can provide a transcript that includes data from
these information returns. State or local information is not included with the Form W-2 information. The IRS may be able to provide this
transcript information for up to 10 years. Information for the current year is generally not available until the year after it is filed with the IRS.
For example, W-2 information for 2007, filed in 2008, will not be available from the IRS until 2009. If you need W-2 information for retirement
purposes, you should contact the Social Security Administration at 1-800-772-1213. Most requests will be processed within 45 days . . .
Caution. If you need a copy of Form W-2 or Form 1099, you should first contact the payer. To get a copy of the Form W-2 or Form 1099 filed
with your return, you must use Form 4506 and request a copy of your return, which includes all attachments.
9 Year or period requested. Enter the ending date of the year or period, using the mm/dd/yyyy format. If you are requesting more than four
years or periods, you must attach another Form 4506-T. For requests relating to quarterly tax returns, such as Form 941, you must enter
each quarter or tax period separately.
Signature of taxpayer(s). I declare that I am either the taxpayer whose name is shown on line 1a or 2a, or a person authorized to obtain the tax
information requested. If the request applies to a joint return, either husband or wife must sign. If signed by a corporate officer, partner, guardian, tax
matters partner, executor, receiver, administrator, trustee, or party other than the taxpayer, I certify that I have the authority to execute
Form 4506-T on behalf of the taxpayer. Note. For transcripts being sent to a third party, this form must be received within 120 days of signature date.
Telephone number of taxpayer on
line 1a or 2a
Signature (see instructions) Date
Sign
Here Title (if line 1a above is a corporation, partnership, estate, or trust)
Spouse’s signature Date
For Privacy Act and Paperwork Reduction Act Notice, see page 2. Cat. No. 37667N Form 4506-T (Rev. 1-2011)

28. Form 4506-T (Rev. 1-2011) Page 2
General Instructions Chart for all other transcripts Corporations. Generally, Form 4506-T can be
signed by: (1) an officer having legal authority to
Purpose of form. Use Form 4506-T to request If you lived in Mail or fax to the bind the corporation, (2) any person designated
tax return information. You can also designate a or your business “Internal Revenue by the board of directors or other governing
third party to receive the information. See line 5. was in: Service” at: body, or (3) any officer or employee on written
Tip. Use Form 4506, Request for Copy of request by any principal officer and attested to
Tax Return, to request copies of tax returns. Alabama, Alaska, by the secretary or other officer.
Arizona, Arkansas,
Where to file. Mail or fax Form 4506-T to Partnerships. Generally, Form 4506-T can be
California, Colorado,
the address below for the state you lived in, signed by any person who was a member of the
Florida, Hawaii, Idaho,
or the state your business was in, when that partnership during any part of the tax period
Iowa, Kansas,
return was filed. There are two address charts: requested on line 9.
Louisiana, Minnesota,
one for individual transcripts (Form 1040 series Mississippi, All others. See Internal Revenue Code section
and Form W-2) and one for all other transcripts. Missouri, Montana, 6103(e) if the taxpayer has died, is insolvent, is a
If you are requesting more than one transcript Nebraska, Nevada, RAIVS Team dissolved corporation, or if a trustee, guardian,
or other product and the chart below shows two New Mexico, P.O. Box 9941 executor, receiver, or administrator is acting for
different RAIVS teams, send your request to the North Dakota, Mail Stop 6734 the taxpayer.
team based on the address of your most recent Oklahoma, Oregon, Ogden, UT 84409 Documentation. For entities other than
return. South Dakota, Texas, individuals, you must attach the authorization
Utah, Washington, document. For example, this could be the letter
Automated transcript request. You can quickly
Wyoming, a foreign from the principal officer authorizing an
request transcripts by using our automated self
country, or A.P.O. or employee of the corporation or the Letters
help-service tools. Please visit us at IRS.gov and
F.P.O. address 801-620-6922 Testamentary authorizing an individual to act for
click on “Order a Transcript” or call
1-800-908-9946. an estate.
Connecticut,
Chart for individual Delaware, District of Privacy Act and Paperwork Reduction Act
Columbia, Georgia, Notice. We ask for the information on this form
transcripts (Form 1040 series and Illinois, Indiana, to establish your right to gain access to the
Form W-2) Kentucky, Maine, requested tax information under the Internal
Maryland, Revenue Code. We need this information to
If you filed an Mail or fax to the Massachusetts, properly identify the tax information and respond
Michigan, New RAIVS Team
individual return “Internal Revenue P.O. Box 145500 to your request. You are not required to request
and lived in: Service” at: Hampshire, New any transcript; if you do request a transcript,
Jersey, New York, Stop 2800 F
Cincinnati, OH 45250 sections 6103 and 6109 and their regulations
Florida, Georgia (After RAIVS Team North Carolina, require you to provide this information, including
June 30, 2011, send P.O. Box 47-421 Ohio, Pennsylvania, your SSN or EIN. If you do not provide this
your transcript Stop 91 Rhode Island, South information, we may not be able to process your
requests to Kansas Doraville, GA 30362 Carolina, Tennessee, request. Providing false or fraudulent information
City, MO) 770-455-2335 Vermont, Virginia, may subject you to penalties.
West Virginia,
Wisconsin 859-669-3592 Routine uses of this information include giving
Alabama, Kentucky, RAIVS Team it to the Department of Justice for civil and
Louisiana, Mississippi, Stop 6716 AUSC criminal litigation, and cities, states, the District
Line 1b. Enter your employer identification
Tennessee, Texas, a Austin, TX 73301 of Columbia, and U.S. commonwealths and
number (EIN) if your request relates to a
foreign country, possessions for use in administering their tax
business return. Otherwise, enter the first
American Samoa, laws. We may also disclose this information to
social security number (SSN) or your individual
Puerto Rico, Guam, the other countries under a tax treaty, to federal and
taxpayer identification number (ITIN) shown on
Commonwealth of the state agencies to enforce federal nontax criminal
the return. For example, if you are requesting
Northern Mariana laws, or to federal law enforcement and
Form 1040 that includes Schedule C (Form
Islands, the U.S. Virgin 512-460-2272 intelligence agencies to combat terrorism.
1040), enter your SSN.
Islands, or A.P.O. or
F.P.O. address Line 3. Enter your current address. If you use a You are not required to provide the
P. O. box, include it on this line. information requested on a form that is subject
to the Paperwork Reduction Act unless the form
Alaska, Arizona, RAIVS Team Line 4. Enter the address shown on the last displays a valid OMB control number. Books or
Arkansas, California, Stop 37106 return filed if different from the address entered records relating to a form or its instructions must
Colorado, Hawaii, Fresno, CA 93888 on line 3. be retained as long as their contents may
Idaho, Illinois, Indiana, become material in the administration of any
Iowa, Kansas, Note. If the address on Lines 3 and 4 are
Internal Revenue law. Generally, tax returns and
Michigan, Minnesota, different and you have not changed your address
return information are confidential, as required by
Montana, Nebraska, with the IRS, file Form 8822, Change of Address.
section 6103.
Nevada, New Mexico, Line 6. Enter only one tax form number per
North Dakota, The time needed to complete and file Form
request.
Oklahoma, Oregon, 559-456-5876 4506-T will vary depending on individual
Signature and date. Form 4506-T must be circumstances. The estimated average time is:
South Dakota, Utah, signed and dated by the taxpayer listed on line
Washington, Learning about the law or the form, 10 min.;
1a or 2a. If you completed line 5 requesting the Preparing the form, 12 min.; and Copying,
Wisconsin, Wyoming information be sent to a third party, the IRS must assembling, and sending the form to the IRS,
receive Form 4506-T within 120 days of the date 20 min.
Connecticut, Delaware, RAIVS Team signed by the taxpayer or it will be rejected.
If you have comments concerning the
District of Columbia, Stop 6705 P-6 Individuals. Transcripts of jointly filed tax accuracy of these time estimates or suggestions
Maine, Maryland, Kansas City, MO returns may be furnished to either spouse. Only for making Form 4506-T simpler, we would be
Massachusetts, 64999 one signature is required. Sign Form 4506-T happy to hear from you. You can write to the
Missouri, New exactly as your name appeared on the original Internal Revenue Service, Tax Products
Hampshire, New return. If you changed your name, also sign your Coordinating Committee, SE:W:CAR:MP:T:T:SP,
Jersey, New York, current name. 1111 Constitution Ave. NW, IR-6526,
North Carolina, Ohio, Washington, DC 20224. Do not send the form to
Pennsylvania, Rhode this address. Instead, see Where to file on this
Island, South Carolina, page.
Vermont, Virginia, West 816-292-6102
Virginia

29. Volunteer Income Tax Assistance Grant Program
IRS VITA Grant Program
The Volunteer Income Tax Assistance Grant Program is an IRS initiative designed to promote and support free tax preparation service for the
underserved, low income populations. These include the elderly, disabled, non-urban, native American and those taxpayers having limited English
proficiency.
In 2011, IRS awarded matching grants to 179 organizations that offered free tax preparation services during the 2011 tax filing season at locations
in all 50 states and the District of Columbia. Congress appropriated $12 million in funding to support the VITA Program.
This year the IRS will be accepting applications for the VITA Grant Program that will allow some organizations to apply for annual funding for up
to three years. The application period opens May 23, 2011 and closes June 30, 2011.
This Grant Program is intended to provide direct funds to organizations to:
• Enable VITA Programs to extend services to underserved populations in hardest-to-reach areas, both urban and non-urban;
• Increase the capacity to file returns electronically;
• Heighten quality control;
• Enhance volunteer training; and
• Significantly improve the accuracy rate of returns prepared at volunteer sites.
Please refer to IRS Publication 4671, VITA Grant 2012 Program Overview and Application Package for more information. Contact the VITA Grant
Program at Grant.Program.Office@irs.gov.
What's Happening Forms Reporting Requirements
• 2012 VITA/TCE Grant Overview • Standard Form 424, Application for Federal • At-A-Glance VITA Grant
• VITA Grant 2012 Workbook Assistance Reporting Requirements
• VITA Grant FAQs by Category • Standard Form 424A, Budget Information–Non- • Guidelines for VITA Grant
• GPO News - May 2011 Construction Programs Reports
• Standard Form 424B, Assurances—Non- • SF 425, Federal Financial Report
Construction Programs • SF PPR, Performance Progress
Report
• Standard Form LLL, Disclosure Form to Report • SF PPR-A, Performance Measures
Lobbying When Applicable • SF PPR-B, Program
• Form 13981, VITA Grant Agreement

30. Publications Important Links Additional Resources
• Publication 561, Determining the • Grants.gov - Online federal grant announcement • 2011 Grant Award Notification
Value of Donated Property and application system. Enclosure
• Publication 1084, IRS Volunteer • Office of Management and Budget- Circulars • 2011 VITA/TCE Grant Recipient
Site Coordinator's Handbook governing the administrative requirements, cost Orientation
• Publication 4299, Privacy and principles, and audit requirements of a grant • Form 13614-C, Intake/Interview
Confidentiality - A Public Trust award. and Quality Review Sheet
• Publication 4671, VITA Grant • Central Contractor Registry - The primary • SF1199-A, Direct Deposit Form
2012 Program Overview and registrant database of contracts and assistance • VITA Grant Program Office
Application Package (Rev. 5- awards for the federal government. Primary Contact Form
2011) • State Review Required under Executive Order • Division of Payment Management
• Publication 4680, VITA Grant 12372 - Allows each state to designate an entity Primary Contact Form
Program brochure (Rev. 3-2011) to review proposed federal financial assistance • Previous GPO News
• Publication 4883, Grant Programs and direct federal development. Visit the Web o March 2011
Resource Guide (Rev. 3-2011) site to determine whether your state participates. o February 2010
• Division of Payment Management - Provides an
on-line payment system that is used to request
federal funds awarded under the VITA Grant
Program.
• Dun & Bradstreet Universal Number - The
DUNS number is a means to identify entities
receiving federal grants and cooperative
agreements. Call 1–866–705–5711 to learn more.
• Sub-award Reporting - Reporting of first tier
sub-awards. Please refer to the Terms and
Conditions Addendum, Form 13981.
Page Last Reviewed or Updated: May 31, 2011
If you would like to be a Volunteer to assist the elderly and disabled file tax returns,
please review the information on the website at www.irs.gov - search for VITA
Volunteer Income Tax Assistance Grant Program.