Form 4952, Investment Interest Expense Deduction - 1040.com-2025

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Form 4952 is used by individuals, estates, or trusts to calculate the deductible amount of investment interest expense for the tax year 2012 and any amount that can be carried forward to future years. The form requires reporting total investment interest expenses, net investment income, and determining the allowable deduction based on these figures. Specific instructions detail how to report various types of income and expenses related to investments, including exceptions and allocations for different purposes.

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Begin with Part I. Enter your total investment interest expense paid or accrued during the year on line 1. Include any amounts reported on Schedule K-1.
On line 2, input any disallowed investment interest expense from the previous year (Form 4952, line 7).
Add lines 1 and 2 to calculate your total investment interest expense on line 3.
Proceed to Part II. Report your gross income from property held for investment on line 4a, excluding net gains from property dispositions.
Complete lines 4b through 4h by detailing qualified dividends and calculating net investment income.
In Part III, determine your investment interest expense deduction by entering the smaller of line 3 or line 6 on line 8.
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What is the tax code 4952?

26 U.S. Code 4952 - Taxes on taxable expenditures. There is hereby imposed on each taxable expenditure (as defined in subsection (d)) from the assets or income of a trust described in section 501(c)(21) a tax equal to 10 percent of the amount thereof.

What is the IRS form 4952 used for?

Use Form 4952 to figure the amount of investment interest expense you can deduct for 2024 and the amount you can carry forward to future years. Your investment interest expense deduction is limited to your net investment income.

Is investment interest expense deductible on 1040?

Types of interest deductible as itemized deductions on Schedule A (Form 1040, Itemized Deductions) include: Investment interest (limited to your net investment income; see Publication 550, Investment Income and Expenses) and. Qualified mortgage interest including points (if youre the buyer); see below.

What is the 1040 Form 4952?

To report your margin interest or other deductible investment interest expenses on your Form 1040, you must complete Form 4952 and include the allowable deduction on Schedule A (Itemized Deductions) under the section for investment interest. This is where you report margin interest on 1040 if it qualifies.

Where does form 4952 flow to?

Investment (margin) interest deduction is claimed on Form 4952 Investment Interest Expense Deduction and the allowable deduction will flow to Schedule A (Form 1040) Itemized Deductions, Line 9 to be claimed as an itemized deduction, up to the amount of your investment income.

form 4952

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What does 4952 mean?

Investment Interest Expense Deduction (Form 4952) Form 4952 is used to calculate the amount of investment interest expense you can deduct on your federal tax return for the current year, as well as any amount you may carry forward to future years.

Where to deduct investment fees on 1040?

Investment expenses (other than interest expenses claimed on IRS Form 4952) are deducted as miscellaneous itemized deductions on Line 23 of Schedule A. To be deductible, these expenses must be ordinary and necessary expenses paid or incurred: To produce or collect income, or. To manage property held for producing