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Notice

Proposed Collection; Comment Request for Form 1040 and Schedules A, B, C, C-EZ, D, E, EIC, F, H, J, R, and SE, Form 1040A, Form 1040EZ, Form 1040NR, Form 1040NR-EZ, Form 1040X, and All Attachments to These Forms

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Start Preamble

AGENCY:

Internal Revenue Service (IRS), Treasury.

ACTION:

Notice and request for comments.

SUMMARY:

The Internal Revenue Service, as part of its continuing effort to reduce paperwork and respondent burden, invites the general public and other Federal agencies to take this opportunity to comment on proposed and continuing information collections, as required by the Paperwork Reduction Act of 1995 (PRA), Public Law 104-13 (44 U.S.C. 3506(c)(2)(A)). This notice requests comments on all forms used by individual taxpayers: Form 1040, U.S. Individual Income Tax Return, and Schedules A, B, C, C-EZ, D, E, EIC, F, H, J, R, and SE; Form 1040A; Form 1040EZ; Form 1040NR; Form 1040NR-EZ; Form 1040X; and all attachments to these forms (see the Appendix to this notice).

DATES:

Written comments should be received on or before April 29, 2014 to be assured of consideration.

ADDRESSES:

Direct all written comments to The OMB Unit, SE:W:CAR:MP:T:T:SP, Internal Revenue Service, Room 6129, 1111 Constitution Avenue NW., Washington, DC 20224.

End Preamble Start Supplemental Information

SUPPLEMENTARY INFORMATION:

PRA Approval of Forms Used by Individual Taxpayers

Under the PRA, OMB assigns a control number to each “collection of information” that it reviews and approves for use by an agency. The PRA also requires agencies to estimate the burden for each collection of information. Burden estimates for each control number are displayed in (1) PRA notices that accompany collections of information, (2) Federal Register notices such as this one, and (3) OMB's database of approved information collections.

Taxpayer Burden Model

The Individual Taxpayer Burden Model (ITBM) estimates burden experienced by individual taxpayers when complying with Federal tax laws and incorporates results from a survey of tax year 2011 individual taxpayers, conducted in 2012 and 2013. The approach to measuring burden focuses on the characteristics and activities undertaken by individual taxpayers in meeting their tax return filing obligations.

Burden is defined as the time and out-of-pocket costs incurred by taxpayers in complying with the Federal tax system and are estimated separately. Out-of-pocket costs include any expenses incurred by taxpayers to prepare and submit their tax returns. Examples include tax return preparation fees, the purchase price of tax preparation software, submission fees, photocopying costs, postage, and phone calls (if not toll-free).

The methodology distinguishes among preparation method, taxpayer activities, taxpayer type, filing method, and income level. Indicators of tax law and administrative complexity, as reflected in the tax forms and instructions, are incorporated into the model.

Preparation methods reflected in the model are as follows:

  • Self-prepared without software,
  • Self-prepared with software, and
  • Use of a paid preparer or tax professional.Start Printed Page 11505

Types of taxpayer activities reflected in the model are as follows:

  • Recordkeeping,
  • Tax planning,
  • Gathering tax materials,
  • Use of services (IRS and other),
  • Form completion, and
  • Form submission.

Taxpayer Burden Estimates

Summary level results using this methodology are presented in Table 1 below. The data shown are the best forward-looking estimates available for income tax returns filed for tax year 2013.

Table 1 shows burden estimates based on current statutory requirements as of November 21, 2013 for taxpayers filing a 2013 Form 1040, 1040A, or 1040EZ tax return. Time spent and out-of-pocket costs are presented separately. Time burden is broken out by taxpayer activity, with record keeping representing the largest component. Out-of-pocket costs include any expenses incurred by taxpayers to prepare and submit their tax returns. Examples include tax return preparation and submission fees, postage and photocopying costs, and tax preparation software costs. While these estimates do not include burden associated with post-filing activities, IRS operational data indicate that electronically prepared and filed returns have fewer arithmetic errors, implying lower post-filing burden.

Reported time and cost burdens are national averages and do not necessarily reflect a “typical” case. Most taxpayers experience lower than average burden, with taxpayer burden varying considerably by taxpayer type. For instance, the estimated average time burden for all taxpayers filing a Form 1040, 1040A, or 1040EZ is 12 hours, with an average cost of $210 per return. This average includes all associated forms and schedules, across all preparation methods and taxpayer activities. The average burden for taxpayers filing Form 1040 is about 15 hours and $280; the average burden for taxpayers filing Form 1040A is about 7 hours and $90; and the average for Form 1040EZ filers is about 4 hours and $30.

Within each of these estimates there is significant variation in taxpayer activity. For example, non-business taxpayers are expected to have an average burden of about 7 hours and $120, while business taxpayers are expected to have an average burden of about 24 hours and $430. Similarly, tax preparation fees and other out-of-pocket costs vary extensively depending on the tax situation of the taxpayer, the type of software or professional preparer used, and the geographic location.

Proposed PRA Submission to OMB

Title: U.S. Individual Income Tax Return.

OMB Number: 1545-0074.

Form Numbers: Form 1040 and Schedules A, B, C, C-EZ, D, D-1, E, EIC, F, H, J, R, and SE; Form 1040A; Form 1040EZ; Form 1040NR; Form 1040NR-EZ, Form 1040X; and all attachments to these forms (see the Appendix to this notice).

Abstract: These forms are used by individuals to report their income tax liability. The data is used to verify that the items reported on the forms are correct, and also for general statistical use.

Current Actions: The change in estimated aggregate compliance burden can be explained by three major sources—technical adjustments, statutory changes, and discretionary agency (IRS) actions.

Technical Adjustments—The largest adjustments are from incorporation of updated tax return data, macroeconomic data, and survey data as well as refinements in the estimation methodology. Updating the FY13 macroeconomic data and incorporating new tax return data lead to the largest technical adjustments. The impact of each technical adjustment can be seen below.

Change in filersChange in timeChange in dollars
Updated FY13 Macroeconomic Data−3,100,000−32,000,000−762,000,000
Updated Tax Return Data0−53,000,000−1,486,000,000
Updated Survey Data06,000,0001,063,000,000
FY14 Population Estimates1,700,0004,000,000908,000,000

Statutory Changes—The primary drivers of the statutory changes are the phaseout of itemized deductions (American Taxpayer Relief Act of 2012), the Net Investment Income Tax (Health Care and Education Reconciliation Act of 2010), and the Additional Medicare Tax (Patient Protection and Affordable Care Act of 2010). The estimated impact of these items is as follows:

Expected filersChange in hoursChange in dollars
Phaseout of Itemized Deductions2,300,000<500,000$21,000,000
Net Investment Income Tax2,800,0004,000,000202,000,000
Additional Medicare Tax3,100,0003,000,000129,000,000

IRS Discretionary Changes Introduction of the Office in the Home Safe Harbor impacts approximately 600,000 filers and decreases time by 1,600,000 hours (rounded to 2,000,000 hours) and money by $7,000,000. All other IRS discretionary changes had a negligible impact on taxpayer burden.Start Printed Page 11506

Table 1—Estimated Average Taxpayer Burden for Individuals by Activity

Primary form filed or type of taxpayerTime burdenMoney burden
Percentage of returnsAverage time burden (hours)Average cost
Total timeRecord keepingTax planningForm completion and submissionAll other
All Taxpayers100126241$210
Primary Forms Filed
104068158241280
1040A197213190
1040EZ1341*2130
Type of Taxpayer
Non-business **7073131120
Business **302413452430
* Rounds to less than one hour.
Detail may not add to total due to rounding. Dollars rounded to the nearest $10.
** A “business” filer files one or more of the following with Form 1040: Schedule C, C-EZ, E, F, Form 2106, or 2106-EZ. A “non-business” filer does not file any of these schedules or forms with Form 1040 or if you file Form 1040A or 1040EZ.

Table 2—ICB Estimates for the 1040/A/EZ/NR/NR-EZ/X Series of Returns and Supporting Forms and Schedules

[FY2014]

Previously approved FY13Program change due to adjustmentProgram change due to new legislationProgram change due to agencyFY14
Number of Taxpayers154,300,000(1,400,000)152,900,000
Burden in Hours1,924,000,000(75,000,000)8,000,000(2,000,000)1,855,000,000
Burden in Dollars31,649,000,000(277,000,000)352,000,000(7,000,000)31,717,000,000

Appendix

FormsFiled by individuals and othersTitle
673Statement for Claiming Exemption from Withholding on Foreign Earned Income Eligible for the Exclusions Provided by Section 911.
926XReturn by a U.S. Transferor of Property to a Foreign Corporation.
970XApplication To Use LIFO Inventory Method.
972XConsent of Shareholder To Include Specific Amount in Gross Income.
982XReduction of Tax Attributes Due To Discharge of Indebtedness (and Section 1082 Basis Adjustment).
1040U.S. Individual Income Tax Return.
1040 SCH AItemized Deductions.
1040 SCH BInterest and Ordinary Dividends.
1040 SCH CXProfit or Loss From Business.
1040 SCH C-EZXNet Profit From Business.
1040 SCH DCapital Gains and Losses.
1040 SCH EXSupplemental Income and Loss.
1040 SCH EICEarned Income Credit.
1040 SCH FXProfit or Loss From Farming.
1040 SCH HXHousehold Employment Taxes.
1040 SCH JIncome Averaging for Farmers and Fishermen.
1040 SCH RCredit for the Elderly or the Disabled.
1040 SCH SESelf-Employment Tax.
1040 SCH 8812
1040 AU.S. Individual Income Tax Return.
1040-C
1040ES (NR)U.S. Estimated Tax for Nonresident Alien Individuals.
1040ES (PR)Estimated Federal Tax on Self Employment Income and on Household Employees (Residents of Puerto Rico).
1040 ES-OCR-VPayment Voucher.
1040 ES-OTCEstimated Tax for Individuals.
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1040 EZIncome Tax Return for Single and Joint Filers With No Dependents.
1040 NRU.S. Nonresident Alien Income Tax Return.
1040 NR-EZU.S. Income Tax Return for Certain Nonresident Aliens With No Dependents.
1040 VPayment Voucher.
1040 V-OCR-ESPayment Voucher.
1040 XAmended U.S. Individual Income Tax Return.
1045XApplication for Tentative Refund.
1116XForeign Tax Credit.
1127XApplication For Extension of Time For Payment of Tax.
1128XApplication To Adopt, Change, or Retain a Tax Year.
1310Statement of Person Claiming Refund Due a Deceased Taxpayer.
2106Employee Business Expenses.
2106 EZUnreimbursed Employee Business Expenses.
2120Multiple Support Declaration.
2210XUnderpayment of Estimated Tax by Individuals, Estates, and Trusts.
2210 FXUnderpayment of Estimated Tax by Farmers and Fishermen.
2350Application for Extension of Time To File U.S. Income Tax Return.
2350 SPSolicitud de Prórroga para Presentar la Declaración del Impuesto Personal sobre el Ingreso de los Estados Unidos.
2439XNotice to Shareholder of Undistributed Long-Term Capital Gains.
2441Child and Dependent Care Expenses.
2555Foreign Earned Income.
2555 EZForeign Earned Income Exclusion.
2848XPower of Attorney and Declaration of Representative.
2848(SP)
3115XApplication for Change in Accounting Method.
3468XInvestment Credit.
3520XAnnual Return To Report Transactions With Foreign Trusts and Receipt of Certain Foreign Gifts.
3800XGeneral Business Credit.
3903Moving Expenses.
4029Application for Exemption From Social Security and Medicare Taxes and Waiver of Benefits.
4070Employee's Report of Tips to Employer.
4070 AEmployee's Daily Record of Tips.
4136XCredit for Federal Tax Paid On Fuels.
4137Social Security and Medicare Tax on Unreported Tip Income.
4255XRecapture of Investment Credit.
4361Application for Exemption From Self-Employment Tax for Use by Ministers, Members of Religious Orders, and Christian Science Practitioners.
4562XDepreciation and Amortization.
4563Exclusion of Income for Bona Fide Residents of American Samoa.
4684XCasualties and Thefts.
4797XSales of Business Property.
4835Farm Rental Income and Expenses.
4852XSubstitute for Form W-2, Wage and Tax Statement or Form 1099-R, Distributions From Pension Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc.
4868Application for Automatic Extension of Time To File Individual U.S. Income Tax Return.
4868 SPSolicitud de Prórroga Automática para Presentar la Declaración del Impuesto sobre el Ingreso Personal de los Estados Unidos.
4952XInvestment Interest Expense Deduction.
4970XTax on Accumulation Distribution of Trusts.
4972XTax on Lump-Sum Distributions.
5074Allocation of Individual Income Tax To Guam or the Commonwealth of the Northern Mariana Islands (CNMI).
5213XElection To Postpone Determination as To Whether the Presumption Applies That an Activity Is Engaged in for Profit.
5329Additional Taxes on Qualified Plans (Including IRAs) and Other Tax-Favored Accounts.
5405First-Time Homebuyer Credit.
5471XInformation Return of U.S. Persons With Respect To Certain Foreign Corporations.
5471 SCH JXAccumulated Earnings and Profits (E&P) of Controlled Foreign Corporation.
5471 SCH MXTransactions Between Controlled Foreign Corporation and Shareholders or Other Related Persons.
5471 SCH OXOrganization or Reorganization of Foreign Corporation, and Acquisitions and Dispositions of Its Stock.
5695Residential Energy Credits.
5713XInternational Boycott Report.
5713 SCH AXInternational Boycott Factor (Section 999(c)(1)).
5713 SCH BXSpecifically Attributable Taxes and Income (Section 999(c)(2)).
5713 SCH CXTax Effect of the International Boycott Provisions.
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5754XStatement by Person(s) Receiving Gambling Winnings.
5884XWork Opportunity Credit.
6198XAt-Risk Limitations.
6251Alternative Minimum Tax—Individuals.
6252XInstallment Sale Income.
6478XCredit for Alcohol Used as Fuel.
6765XCredit for Increasing Research Activities.
6781XGains and Losses From Section 1256 Contracts and Straddles.
8082XNotice of Inconsistent Treatment or Administrative Adjustment Request (AAR).
8275XDisclosure Statement.
8275 RXRegulation Disclosure Statement.
8283XNoncash Charitable Contributions.
8332Release of Claim to Exemption for Child of Divorced or Separated Parents.
8379Injured Spouse Claim and Allocation.
8396Mortgage Interest Credit.
8453U.S. Individual Income Tax Declaration for an IRS e-file Return.
8453(SP)
8582XPassive Activity Loss Limitations.
8582 CRXPassive Activity Credit Limitations.
8586XLow-Income Housing Credit.
8594XAsset Acquisition Statement.
8606Nondeductible IRAs.
8609-AXAnnual Statement for Low-Income Housing Credit.
8611XRecapture of Low-Income Housing Credit.
8615Tax for Certain Children Who Have Investment Income of More Than $1,800.
8621XReturn by a Shareholder of a Passive Foreign Investment Company or Qualified Electing Fund.
8621-AXLate Deemed Dividend or Deemed Sale Election by a Passive Foreign Investment Company.
8689Allocation of Individual Income Tax To the Virgin Islands.
8693XLow-Income Housing Credit Disposition Bond.
8697XInterest Computation Under the Look-Back Method for Completed Long-Term Contracts.
8801XCredit for Prior Year Minimum Tax—Individuals, Estates, and Trusts.
8812Additional Child Tax Credit.
8814Parents' Election To Report Child's Interest and Dividends.
8815Exclusion of Interest From Series EE and I U.S. Savings Bonds Issued After 1989.
8818Optional Form To Record Redemption of Series EE and I U.S. Savings Bonds Issued After 1989.
8820XOrphan Drug Credit.
8821XTax Information Authorization.
8822XChange of Address.
8824XLike-Kind Exchanges.
8826XDisabled Access Credit.
8828Recapture of Federal Mortgage Subsidy.
8829Expenses for Business Use of Your Home.
8832XEntity Classification Election.
8833XTreaty-Based Return Position Disclosure Under Section 6114 or 7701(b).
8834XQualified Electric Vehicle Credit.
8835XRenewable Electricity and Refined Coal Production Credit.
8838XConsent To Extend the Time To Assess Tax Under Section 367—Gain Recognition Statement.
8839Qualified Adoption Expenses.
8840Closer Connection Exception Statement for Aliens.
8843Statement for Exempt Individuals and Individuals With a Medical Condition.
8844XEmpowerment Zone and Renewal Community Employment Credit.
8845XIndian Employment Credit.
8846XCredit for Employer Social Security and Medicare Taxes Paid on Certain Employee Tips.
8847XCredit for Contributions to Selected Community Development Corporations.
8853Archer MSAs and Long-Term Care Insurance Contracts.
8854Initial and Annual Expatriation Information Statement.
8858XInformation Return of U.S. Persons With Respect to Foreign Disregarded Entities.
8858 SCH MXTransactions Between Controlled Foreign Disregarded Entity and Filer or Other Related Entities.
8859District of Columbia First-Time Homebuyer Credit.
8862Information to Claim Earned Income Credit After Disallowance.
8862(SP)
8863Education Credits.
8864XBiodiesel Fuels Credit.
8865XReturn of U.S. Persons With Respect To Certain Foreign Partnerships.
8865 SCH K-1XPartner's Share of Income, Credits, Deductions, etc.
Start Printed Page 11509
8865 SCH OXTransfer of Property to a Foreign Partnership.
8865 SCH PXAcquisitions, Dispositions, and Changes of Interests in a Foreign Partnership.
8866XInterest Computation Under the Look-Back Method for Property Depreciated Under the Income Forecast Method.
8873XExtraterritorial Income Exclusion.
8874XNew Markets Credit.
8878IRS e-file Signature Authorization for Form 4868 or Form 2350.
8878 SPAutorizacion de firma para presentar por medio del IRS e-file para el Formulario 4868(SP) o el Formulario 2350(SP).
8879IRS e-file Signature Authorization.
8879 SPAutorizacion de firma para presentar la Declaracion por medio del IRS e-file.
8880Credit for Qualified Retirement Savings Contributions.
8881XCredit for Small Employer Pension Plan Startup Costs.
8882XCredit for Employer-Provided Childcare Facilities and Services.
8885Health Coverage Tax Credit.
8886XReportable Transaction Disclosure Statement.
8888Allocation of Refund (Including Savings Bond Purchases).
8889Health Savings Accounts (HSAs).
8891U.S. Information Return for Beneficiaries of Certain Canadian Registered Retirement Plans.
8896XLow Sulfur Diesel Fuel Production Credit.
8898Statement for Individuals Who Begin or End Bona Fide Residence in a U.S. Possession.
8900XQualified Railroad Track Maintenance Credit.
8903XDomestic Production Activities Deduction.
8906Distills Spirits Credit.
8907Nonconventional Source Fuel Credit.
8908Energy Efficient Home Credit.
8909
8910Alternative Motor Vehicle Credit.
8911Alternative Fuel Vehicle Refueling Property Credit.
8912
8917Tuition and Fees Deduction.
8919Uncollected Social Security and Medicare Tax on Wages.
8923Mine Rescue Team Training Credit.
8925XReport of Employer-Owned Life Insurance Contracts.
8931XAgricultural Chemicals Security Credit.
8932XCredit for Employer Differential Wage Payments.
8933Carbon Dioxide Sequestration Credit.
8936Qualified Plug-in Electric Drive Motor Vehicle Credit.
9465Installment Agreement Request.
9465 SPSolicitud para un Plan de Pagos a Plazos.
Notice 2006-52
Notice 160920-05Deduction for Energy Efficient Commercial Buildings.
Pub 972 TablesChild Tax Credit.
REG-149856-03Notice of Proposed Rulemaking Dependent Child of Divorced or Separated Parents or Parents Who Live Apart.
SS-4XApplication for Employer Identification Number.
SS-8XDetermination of Worker Status for Purposes of Federal Employment Taxes and Income Tax Withholding.
T (Timber)XForest Activities Schedules.
W-4Employee's Withholding Allowance Certificate.
W-4 PWithholding Certificate for Pension or Annuity Payments.
W-4 SRequest for Federal Income Tax Withholding From Sick Pay.
W -4 SPCertificado de Exencion de la Retencion del Empleado.
W-4 VVoluntary Withholding Request.
W-7Application for IRS Individual Taxpayer Identification Number.
W-7 AApplication for Taxpayer Identification Number for Pending U.S. Adoptions.
W-7 SPSolicitud de Numero de Identicacion Personal del Contribuyente del Servicio de Impuestos Internos.
Start Printed Page 11510 End Supplemental Information

[FR Doc. 2014-04374 Filed 2-27-14; 8:45 am]

BILLING CODE 4830-01-P