You must report unearned income, such as interest, dividends, and pensions, from sources outside the United States unless exempt by law or a tax treaty. You must also report earned income, such as wages and tips, from sources outside the United States.
If you worked abroad, you may be able to exclude part or all of your earned income. For details, see Pub. 54 and Form 2555 or 2555-EZ.taxmap/instr/i1040gi-010.htm#TXMP44462bd8
If you were a beneficiary of a foreign retirement plan, you may have to report the undistributed income earned in your plan. However, if you were the beneficiary of a Canadian registered retirement plan, see Form 8891 to find out if you can elect to defer tax on the undistributed income.
Report distributions from foreign pension plans on lines 16a and 16b.taxmap/instr/i1040gi-010.htm#TXMP618c3f76
If you are a debtor in a chapter 11 bankruptcy case, income taxable to the bankruptcy estate and reported on the estate's income tax return includes:
- Earnings from services you performed after the beginning of the case (both wages and self-employment income), and
- Income from property described in section 541 of title 11 of the U.S. Code that you either owned when the case began or that you acquired after the case began and before the case was closed, dismissed, or converted to a case under a different chapter.
Because this income is taxable to the estate, do not include this income on your own individual income tax return. The only exception is for purposes of figuring your self-employment tax. For that purpose, you must take into account all your self-employment income for the year from services performed both before and after the beginning of the case. Also, you (or the trustee, if one is appointed) must allocate between you and the bankruptcy estate the wages, salary, or other compensation and withheld income tax reported to you on Form W-2. A similar allocation is required for income and withheld income tax reported to you on Forms 1099. You must also attach a statement to your tax return that indicates you filed a chapter 11 case and that explains how income and withheld income tax reported to you on Forms W-2 and 1099 are allocated between you and the estate. For more details, including acceptable allocation methods, see Notice 2006-83, 2006-40 I.R.B. 596, available at www.irs.gov/irb/2006-40_IRB/ar12.html
Community property states are Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin. If you and your spouse lived in a community property state, you must usually follow state law to determine what is community income and what is separate income. For details, see Pub. 555.taxmap/instr/i1040gi-010.htm#TXMP57f5a150
A registered domestic partner in California must report all wages, salaries, and other compensation received for his or her personal services on his or her own return. Therefore, a registered domestic partner cannot report half the combined income earned by the individual and his or her domestic partner as a married person filing separately does in California.taxmap/instr/i1040gi-010.htm#TXMP7f60028f
You can round off cents to whole dollars on your return and schedules. If you do round to whole dollars, you must round all amounts. To round, drop amounts under 50 cents and increase amounts from 50 to 99 cents to the next dollar. For example, $1.39 becomes $1 and $2.50 becomes $3.
If you have to add two or more amounts to figure the amount to enter on a line, include cents when adding the amounts and round off only the total.taxmap/instr/i1040gi-010.htm#TXMP0fd04aa2taxmap/instr/i1040gi-010.htm#TXMP29f500d7
Enter the total of your wages, salaries, tips, etc. If a joint return, also include your spouse's income. For most people, the amount to enter on this line should be shown in box 1 of their Form(s) W-2. But the following types of income must also be included in the total on line 7.
- Wages received as a household employee for which you did not receive a Form W-2 because your employer paid you less than $1,600 in 2008. Also, enter "HSH" and the amount not reported on Form W-2 on the dotted line next to line 7.
- Tip income you did not report to your employer. Also include allocated tips shown on your Form(s) W-2 unless you can prove that you received less. Allocated tips should be shown in box 8 of your Form(s) W-2. They are not included as income in box 1. See Pub. 531 for more details.
You may owe social security and Medicare tax on unreported or allocated tips. See the instructions for line 58 on
- Dependent care benefits, which should be shown in box 10 of your Form(s) W-2. But first complete Form 2441 to see if you can exclude part or all of the benefits.
- Employer-provided adoption benefits, which should be shown in box 12 of your Form(s) W-2 with code T. But see the Instructions for Form 8839 to find out if you can exclude part or all of the benefits. You may also be able to exclude amounts if you adopted a child with special needs and the adoption became final in 2008.
- Scholarship and fellowship grants not reported on Form W-2. Also, enter
SCH and the amount on the dotted line next to line 7. However, if you were a degree candidate, include on line 7 only the amounts you used for expenses other than tuition and course-related expenses. For example, amounts used for room, board, and travel must be reported on line 7.
- Excess salary deferrals. The amount deferred should be shown in box 12 of your Form W-2, and the
Retirement plan box in box 13 should be checked. If the total amount you (or your spouse if filing jointly) deferred for 2008 under all plans was more than $15,500 (excluding catch-up contributions as explained below), include the excess on line 7. This limit is (a) $10,500 if you only have SIMPLE plans, or (b) $18,500 for section 403(b) plans if you qualify for the 15-year rule in Pub. 571. Although designated Roth contributions are subject to this limit, do not include the excess attributable to such contributions on line 7. They are already included as income in box 1 of your Form W-2.
A higher limit may apply to participants in section 457(b) deferred compensation plans for the 3 years before retirement age. Contact your plan administrator for more information.
If you were age 50 or older at the end of 2008, your employer may have allowed an additional deferral (catch-up contributions) of up to $5,000 ($2,500 for section 401(k)(11) and SIMPLE plans). This additional deferral amount is not subject to the overall limit on elective deferrals.
You cannot deduct the amount deferred. It is not included as income in box 1 of your Form W-2.
- Disability pensions shown on Form 1099-R if you have not reached the minimum retirement age set by your employer. But see on page 24. Disability pensions received after you reach minimum retirement age and other payments shown on Form 1099-R (other than payments from an IRA*) are reported on lines 16a and 16b. Payments from an IRA are reported on lines 15a and 15b.
- Corrective distributions from a retirement plan shown on Form 1099-R of excess salary deferrals and excess contributions (plus earnings). But do not include distributions from an IRA* on line 7. Instead, report distributions from an IRA on lines 15a and 15b.
- Wages from Form 8919, line 6.
|*This includes a Roth, SEP, or SIMPLE IRA.|
If you were, the taxmap/instr/i1040gi-010.htm#TXMP37cefe3e
Statutory employee box in box 13 of your Form W-2 should be checked. Statutory employees include full-time life insurance salespeople, certain agent or commission drivers and traveling salespeople, and certain homeworkers. If you have related business expenses to deduct, report the amount shown in box 1 of your Form W-2 on Schedule C or C-EZ along with your expenses.
Your employer is required to provide or send Form W-2 to you no later than taxmap/instr/i1040gi-010.htm#TXMP522315d6taxmap/instr/i1040gi-010.htm#TXMP678fe2ba
February 2, 2009. If you do not receive it by early February, use TeleTax topic 154 (see page 84) to find out what to do. Even if you do not get a Form W-2, you must still report your earnings on line 7. If you lose your Form W-2 or it is incorrect, ask your employer for a new one.
Each payer should send you a Form 1099-INT or Form 1099-OID. Enter your total taxable interest income on line 8a. But you must fill in and attach Schedule B if the total is over $1,500 or any of the other conditions listed at the beginning of the Schedule B instructions (see page B-1) apply to you.
Interest credited in 2008 on deposits that you could not withdraw because of the bankruptcy or insolvency of the financial institution may not have to be included in your 2008 income. For details, see
If you get a 2008 Form 1099-INT for U.S. savings bond interest that includes amounts you reported before 2008, see Pub. 550.
If you received any tax-exempt interest, such as from municipal bonds, each payer should send you a Form 1099-INT. Your tax-exempt interest, plus any exempt-interest dividends from a mutual fund or other regulated investment company, should be included in box 8 of Form 1099-INT. Enter the total on line 8b. Do not include interest earned on your IRA, health savings account, Archer or Medicare Advantage MSA, or Coverdell education savings account.taxmap/instr/i1040gi-010.htm#TXMP29fac8b5taxmap/instr/i1040gi-010.htm#TXMP7de1b085
Each payer should send you a Form 1099-DIV. Enter your total ordinary dividends on line 9a. This amount should be shown in box 1a of Form(s) 1099-DIV.
You must fill in and attach Schedule B if the total is over $1,500 or you received, as a nominee, ordinary dividends that actually belong to someone else.taxmap/instr/i1040gi-010.htm#TXMP6715ed80
Some distributions are a return of your cost (or other basis). They will not be taxed until you recover your cost (or other basis). You must reduce your cost (or other basis) by these distributions. After you get back all of your cost (or other basis), you must report these distributions as capital gains on Schedule D. For details, see Pub. 550.
Dividends on insurance policies are a partial return of the premiums you paid. Do not report them as dividends. Include them in income on line 21 only if they exceed the total of all net premiums you paid for the contract.
Enter your total qualified dividends on taxmap/instr/i1040gi-010.htm#TXMP03ed2d5b
line 9b. Qualified dividends are eligible for a lower tax rate than other ordinary income. Generally, these dividends are shown in box 1b of Form(s) 1099-DIV. See Pub. 550 for the definition of qualified dividends if you received dividends not reported on Form 1099-DIV.
Some dividends may be reported as qualified dividends in box 1b of Form 1099-DIV but are not qualified dividends. These include:
- Dividends you received as a nominee. See the Instructions for Schedule B.
- Dividends you received on any share of stock that you held for less than 61 days during the 121-day period that began 60 days before the ex-dividend date. The ex-dividend date is the first date following the declaration of a dividend on which the purchaser of a stock is not entitled to receive the next dividend payment. When counting the number of days you held the stock, include the day you disposed of the stock but not the day you acquired it. See the examples on this page. Also, when counting the number of days you held the stock, you cannot count certain days during which your risk of loss was diminished. See Pub. 550 for more details.
- Dividends attributable to periods totaling more than 366 days that you received on any share of preferred stock held for less than 91 days during the 181-day period that began 90 days before the ex-dividend date. When counting the number of days you held the stock, you cannot count certain days during which your risk of loss was diminished. See Pub. 550 for more details. Preferred dividends attributable to periods totaling less than 367 days are subject to the 61-day holding period rule on this page.
- Dividends on any share of stock to the extent that you are under an obligation (including a short sale) to make related payments with respect to positions in substantially similar or related property.
- Payments in lieu of dividends, but only if you know or have reason to know that the payments are not qualified dividends.
You bought 5,000 shares of XYZ Corp. common stock on July 1, 2008. XYZ Corp. paid a cash dividend of 10 cents per share. The ex-dividend date was July 9, 2008. Your Form 1099-DIV from XYZ Corp. shows $500 in box 1a (ordinary dividends) and in box 1b (qualified dividends). However, you sold the 5,000 shares on August 4, 2008. You held your shares of XYZ Corp. for only 34 days of the 121-day period (from July 2, 2008, through August 4, 2008). The 121-day period began on May 10, 2008 (60 days before the ex-dividend date), and ended on September 7, 2008. You have no qualified dividends from XYZ Corp. because you held the XYZ stock for less than 61 days.taxmap/instr/i1040gi-010.htm#TXMP118272a2
Assume the same facts as in Example 1 except that you bought the stock on July 8, 2008 (the day before the ex-dividend date), and you sold the stock on September 9, 2008. You held the stock for 63 days (from July 9, 2008, through September 9, 2008). The $500 of qualified dividends shown in box 1b of Form 1099-DIV are all qualified dividends because you held the stock for 61 days of the 121-day period (from July 9, 2008, through September 7, 2008).taxmap/instr/i1040gi-010.htm#TXMP3b2a7110
You bought 10,000 shares of ABC Mutual Fund common stock on July 1, 2008. ABC Mutual Fund paid a cash dividend of 10 cents a share. The ex-dividend date was July 9, 2008. The ABC Mutual Fund advises you that the portion of the dividend eligible to be treated as qualified dividends equals 2 cents per share. Your Form 1099-DIV from ABC Mutual Fund shows total ordinary dividends of $1,000 and qualified dividends of $200. However, you sold the 10,000 shares on August 4, 2008. You have no qualified dividends from ABC Mutual Fund because you held the ABC Mutual Fund stock for less than 61 days.
Be sure you use the Qualified Dividends and Capital Gain Tax Worksheet or the
Schedule D Tax Worksheet, whichever applies, to figure your tax. Your tax may be less if you use the worksheet that applies. See the instructions for line 44 that begin on page 36 for details.
None of your refund is taxable if, in the year you paid the tax, you either (a) did not itemize deductions, or (b) elected to deduct state and local general sales taxes instead of state and local income taxes.
If you received a refund, credit, or offset of state or local income taxes in 2008, you may receive a Form 1099-G. If you chose to apply part or all of the refund to your 2008 estimated state or local income tax, the amount applied is treated as received in 2008. If the refund was for a tax you paid in 2007 and you deducted state and local income taxes on line 5 of your 2007 Schedule A, use the worksheet below to see if any of your refund is taxable.taxmap/instr/i1040gi-010.htm#TXMP29e3a5ae
See Itemized Deduction Recoveries
in Pub. 525 instead of using the worksheet below if any of the following applies.
- You received a refund in 2008 that is for a tax year other than 2007.
- You received a refund other than an income tax refund, such as a general sales tax or real property tax refund, in 2008 of an amount deducted or credit claimed in an earlier year.
- The amount on your 2007 Form 1040, line 42, was more than the amount on your 2007 Form 1040, line 41.
- Your 2007 state and local income tax refund is more than your 2007 state and local income tax deduction minus the amount you could have deducted as your 2007 state and local general sales taxes.
- You made your last payment of 2007 estimated state or local income tax in 2008.
- You owed alternative minimum tax in 2007.
- You could not use the full amount of credits you were entitled to in 2007 because the total credits were more than the amount shown on your 2007 Form 1040, line 46.
- You could be claimed as a dependent by someone else in 2007.
- You had to use the Itemized Deductions Worksheet in the 2007 Instructions for Schedules A&B because your 2007 adjusted gross income was over $156,400 ($78,200 if married filing separately) and both of the following apply.
- You could not deduct all of the amount on the 2007 Itemized Deductions Worksheet, line 1.
- The amount on line 8 of that 2007 worksheet would be more than the amount on line 4 of that worksheet if the amount on line 4 were reduced by 80% of the refund you received in 2008.
Enter amounts received as alimony or separate maintenance. You must let the person who made the payments know your social security number. If you do not, you may have to pay a $50 penalty. For more details, see Pub. 504.
State and Local Income Tax Refund Worksheet—Line 10
- Be sure you have read the Exception above to see if you can use this worksheet instead of Pub. 525 to figure if any of your refund is taxable.
| || |
|1.|| ||Enter the income tax refund from Form(s) 1099-G (or similar statement). But do not enter more than the amount of your state and local income taxes shown on your 2007 Schedule A, line 5 ||1.|| || |
|2.|| ||Enter your total allowable itemized deductions from your 2007 Schedule A, line 29||2.|| || || |
| || || || || || || |
| ||Note. If the filing status on your 2007 Form 1040 was married filing separately and your spouse itemized deductions in 2007, skip lines 3, 4, and 5, and enter the amount from line 2 on line 6. || || |
|3.|| ||Enter the amount shown below for the filing status claimed on your 2007 Form 1040. || || |
| || |
- Single or married filing separately— $5,350
- Married filing jointly or qualifying widow(er)— $10,700
| || ||3.|| || || |
| || |
- Head of household— $7,850
| || |
|4.|| ||Did you fill in line 39a on your 2007 Form 1040?|| || |
| || No.||Enter -0-.|| || || || || |
| || Yes.||Multiply the number in the box on line 39a of your 2007 Form 1040 by $1,050 ($1,300 if your 2007 filing status was single or head of household). || ||4.|| || || |
|5.|| ||Add lines 3 and 4||5.|| || || |
|6.|| ||Is the amount on line 5 less than the amount on line 2?|| || |
| || No.|| ||None of your refund is taxable.|| || |
| || Yes.|| Subtract line 5 from line 2||6.|| || |
|7.|| ||Taxable part of your refund. Enter the smaller of line 1 or line 6 here and on Form 1040, line 10 ||7.|| || |
| || |
If you operated a business or practiced your profession as a sole proprietor, report your income and expenses on Schedule C or C-EZ.taxmap/instr/i1040gi-010.htm#TXMP25cc99b9taxmap/instr/i1040gi-010.htm#TXMP19ca8a5a
If you had a capital gain or loss, including any capital gain distributions or a capital loss carryover from 2007, you must complete and attach Schedule D.taxmap/instr/i1040gi-010.htm#TXMP797820a2
You do not have to file Schedule D if both of the following apply.
- The only amounts you have to report on Schedule D are capital gain distributions from Form(s) 1099-DIV, box 2a, or substitute statements.
- None of the Form(s) 1099-DIV or substitute statements have an amount in box 2b (unrecaptured section 1250 gain), box 2c (section 1202 gain), or box 2d (collectibles (28%) gain).
If both of the above apply, enter your total capital gain distributions (from box 2a of Form(s) 1099-DIV) on line 13 and check the box on that line. If you received capital gain distributions as a nominee (that is, they were paid to you but actually belong to someone else), report on line 13 only the amount that belongs to you. Attach a statement showing the full amount you received and the amount you received as a nominee. See the Instructions for Schedule B for filing requirements for Forms 1099-DIV and 1096.
If you do not have to file Schedule D, use the Qualified Dividends and Capital Gain Tax Worksheet on page 38 to figure your tax. Your tax is usually less if you use this worksheet.
If you sold or exchanged assets used in a trade or business, see the Instructions for Form 4797.taxmap/instr/i1040gi-010.htm#TXMP3bb52c64taxmap/instr/i1040gi-010.htm#TXMP7ba3fcff
Special rules may apply to your IRA distributions if your main home was in the Kansas disaster area or a Midwestern disaster area. Special rules may also apply if you received a distribution to buy or construct a main home in a Midwestern disaster area, but that home was not bought or constructed because of the Midwestern storms, tornadoes, or flooding. For details, see Pub. 4492-A (Kansas) or Pub. 4492-B (Midwestern disaster areas).
You should receive a Form 1099-R showing the amount of any distribution from your IRA. Unless otherwise noted in the line 15a and 15b instructions, an IRA includes a traditional IRA, Roth IRA, simplified employee pension (SEP) IRA, and a savings incentive match plan for employees (SIMPLE) IRA. Except as provided below, leave line 15a blank and enter the total distribution on line 15b.taxmap/instr/i1040gi-010.htm#TXMP76d88ebf
Enter the total distribution on line 15a if you rolled over part or all of the distribution from one:
- IRA to another IRA of the same type (for example, from one traditional IRA to another traditional IRA), or
- SEP or SIMPLE IRA to a traditional IRA.
Rollover next to line 15b. If the total distribution was rolled over in a qualified rollover, enter -0- on line 15b. If the total distribution was not rolled over in a qualified rollover, enter the part not rolled over on line 15b unless Exception 2 or Exception 5 applies to the part not rolled over. Generally, a qualified rollover must be made within 60 days after the day you received the distribution. For more details on rollovers, see Pub. 590.
If you rolled over the distribution into a qualified plan other than an IRA or you made the rollover in 2009, attach a statement explaining what you did.taxmap/instr/i1040gi-010.htm#TXMP5ad61f1e
If any of the following apply, enter the total distribution on line 15a and see Form 8606 and its instructions to figure the amount to enter on line 15b.
- You received a distribution from an IRA (other than a Roth IRA) and you made nondeductible contributions to any of your traditional or SEP IRAs for 2008 or an earlier year. If you made nondeductible contributions to these IRAs for 2008, also see Pub. 590.
- You received a distribution from a Roth IRA. But if either (a) or (b) below applies, enter -0- on line 15b; you do not have to see Form 8606 or its instructions.
- Distribution code T is shown in box 7 of Form 1099-R and you made a contribution (including a conversion) to a Roth IRA for 2003 or an earlier year.
- Distribution code Q is shown in box 7 of Form 1099-R.
- You converted part or all of a traditional, SEP, or SIMPLE IRA to a Roth IRA in 2008.
- You had a 2007 or 2008 IRA contribution returned to you, with the related earnings or less any loss, by the due date (including extensions) of your tax return for that year.
- You made excess contributions to your IRA for an earlier year and had them returned to you in 2008.
- You recharacterized part or all of a contribution to a Roth IRA as a traditional IRA contribution, or vice versa.
If the distribution is a qualified charitable distribution (QCD), enter the total distribution on line 15a. If the total amount distributed is a QCD, enter -0- on line 15b. If only part of the distribution is a QCD, enter the part that is not a QCD on line 15b unless Exception 2 or Exception 5 applies to that part. Enter
QCD next to line 15b.
A QCD is a distribution made directly by the trustee of your IRA (other than a SEP or SIMPLE IRA) to an organization eligible to receive tax-deductible contributions (with certain exceptions). You must have been at least age 70 when the distribution was made. Your total QCDs for the year cannot be more than $100,000. (On a joint return, your spouse can also have a QCD of up to $100,000.) The amount of the QCD is limited to the amount that would otherwise be included in your income. If your IRA includes nondeductible contributions, the distribution is first considered to be paid out of otherwise taxable income. See Pub. 590 for details.
You cannot claim a charitable contribution deduction for any QCD not included in your income.
If the distribution is a qualified health savings account (HSA) funding distribution (HFD), enter the total distribution on line 15a. If the total amount distributed is an HFD and you elect to exclude it from income, enter -0- on line 15b. If only part of the distribution is an HFD and you elect to exclude that part from income, enter the part that is not an HFD on line 15b unless Exception 2 or Exception 5 applies to that part. Enter
HFD next to line 15b.
An HFD is a distribution made directly by the trustee of your IRA (other than a SEP or SIMPLE IRA) to your HSA. If eligible, you generally can elect to exclude an HFD from your income once in your lifetime. You cannot exclude more than the limit on HSA contributions or more than the amount that would otherwise be in cluded in your income. If your IRA includes nondeductible contributions, the HFD is first considered to be paid out of otherwise taxable income. See Pub. 969 for details.
The amount of an HFD reduces the amount you can contribute to your HSA for the year. If you fail to maintain eligibility for an HSA for the 12 months following the month of the HFD, you may have to report the HFD as income and pay an additional tax. See Form 8889, Part III.
If the distribution is the withdrawal of an economic stimulus payment that was directly deposited to your IRA, enter the total distribution on line 15a. If you made the withdrawal by the due date of your return (including extensions):
ESP next to line 15b, and
- If the total distribution was less than or equal to the economic stimulus payment, enter -0- on line 15b. Otherwise, enter the amount by which the distribution was more than the economic stimulus payment on line 15b unless another exception applies to that part.
See Pub. 590 for details.
If more than one exception applies, attach a statement showing the amount of each exception, instead of making an entry next to line 15b. For example: taxmap/instr/i1040gi-010.htm#TXMP6309e008
Line 15b – $1,000 Rollover and $500 HFD.
If you (or your spouse if filing jointly) received more than one distribution, figure the taxable amount of each distribution and enter the total of the taxable amounts on line 15b. Enter the total amount of those distributions on line 15a.
You may have to pay an additional tax if (a) you received an early distribution from your IRA and the total was not rolled over, or (b) you were born before July 1, 1937, and received less than the minimum required distribution from your traditional, SEP, and SIMPLE IRAs. See the instructions for line 59 on page 44 for details.
Special rules may apply if you received a distribution from a profit-sharing or retirement plan and your main home was in the Kansas disaster area or a Midwestern disaster area. Special rules may also apply if you received a distribution to buy or construct a main home in a Midwestern disaster area, but that home was not bought or constructed because of the Midwestern storms, tornadoes, or flooding. For details, see Pub. 4492-A (Kansas) or Pub. 4492-B (Midwestern disaster areas).
You should receive a Form 1099-R showing the amount of your pension and annuity payments, including distributions from 401(k) and 403(b) plans. See page 26 for details on rollovers and lump-sum distributions. Do not include the following payments on lines 16a and 16b. Instead, report them on line 7.
- Disability pensions received before you reach the minimum retirement age set by your employer.
- Corrective distributions (including any earnings) of excess salary deferrals or excess contributions to retirement plans. The plan must advise you of the year(s) the distributions are includible in income.
Attach Form(s) 1099-R to
Form 1040 if any federal
income tax was withheld.
If your pension or annuity is fully taxable, enter it on line 16b; do not make an entry on line 16a. Your payments are fully taxable if (a) you did not contribute to the cost (see page 26) of your pension or annuity, or (b) you got your entire cost back tax free before 2008. But see Insurance Premiums for Retired Public Safety Officers
on this page.
Simplified Method Worksheet—Lines 16a and 16b
Note. If you had more than one partially taxable pension or annuity, figure the taxable part of each separately. Enter the total of the taxable parts on Form 1040, line 16b. Enter the total pension or annuity payments received in 2008 on Form 1040, line 16a.
- If you are the beneficiary of a deceased employee or former employee who died before August 21, 1996, include any death benefit exclusion that you are entitled to (up to $5,000) in the amount entered on line 2 below.
|1.||Enter the total pension or annuity payments received in 2008. Also, enter this amount on Form 1040, |
|1.|| || |
|2.||Enter your cost in the plan at the annuity starting date||2.|| || || |
| ||Note. If you completed this worksheet last year, skip line 3 and enter the amount from line 4 of last year's worksheet on line 4 below (even if the amount of your pension or annuity has changed). Otherwise, go to line 3. || || || || || || |
|3.||Enter the appropriate number from Table 1 below. But if your annuity starting date was after 1997 and the payments are for your life and that of your beneficiary, enter the appropriate number from Table 2 below ||3.|| || || |
|4.||Divide line 2 by the number on line 3||4.|| || || |
|5.||Multiply line 4 by the number of months for which this year's payments were made. If your annuity starting date was before 1987, skip lines 6 and 7 and enter this amount on line 8. Otherwise, go to line 6 ||5.|| || || |
|6.||Enter the amount, if any, recovered tax free in years after 1986. If you completed this worksheet last year, enter the amount from line 10 of last year's worksheet ||6.|| || || |
|7.||Subtract line 6 from line 2||7.|| || || |
|8.||Enter the smaller of line 5 or line 7 ||8.|| || |
|9.||Taxable amount. Subtract line 8 from line 1. Enter the result, but not less than zero. Also, enter this amount on Form 1040, line 16b. If your Form 1099-R shows a larger amount, use the amount on this line instead of the amount from Form 1099-R. If you are a retired public safety officer, see Insurance Premiums for Retired Public Safety Officers on page 24 before entering an amount on line 16b. ||9.|| || |
|10.||Was your annuity starting date before 1987?|| || || || |
| || Yes.|| Leave line 10 blank. || || || || |
| || No.||Add lines 6 and 8. This is the amount you have recovered tax free through 2008. You will need this number when you fill out this worksheet next year ||10.|| || |
| || |
|Table 1 for Line 3 Above|| |
| || || ||AND your annuity starting date was—|| || |
| ||IF the age at annuity starting date (see page 24) was . . .|| ||before November 19, 1996,|
enter on line 3 . . .
| ||after November 18, 1996, enter on line 3 . . . || || |
| || 55 or under|| ||300|| ||360|| || |
| || 56–60|| ||260|| ||310|| || |
| || 61–65|| ||240|| ||260|| || |
| || 66–70|| ||170|| ||210|| || |
| || 71 or older|| ||120|| ||160|| || |
|Table 2 for Line 3 Above|
| ||IF the combined ages at annuity|
starting date (see page 24) were . . .
| ||THEN enter on line 3 . . .|| || |
| || 110 or under|| ||410|| || |
| || 111–120|| ||360|| || |
| || 121–130|| ||310|| || |
| || 131–140|| ||260|| || |
| || 141 or older|| ||210|| || |
Fully taxable pensions and annuities also include military retirement pay shown on Form 1099-R. For details on military disability pensions, see Pub. 525. If you received a Form RRB-1099-R, see taxmap/instr/i1040gi-010.htm#TXMP109ef0d0
Pub. 575 to find out how to report your benefits.
Enter the total pension or annuity payments you received in 2008 on line 16a. If your Form 1099-R does not show the taxable amount, you must use the General Rule explained in Pub. 939 to figure the taxable part to enter on line 16b. But if your annuity starting date (defined on this page) was after July 1, 1986, see Simplified Method on this page to find out if you must use that method to figure the taxable part.
You can ask the IRS to figure the taxable part for you for a $500 fee. For details, see Pub. 939.
If your Form 1099-R shows a taxable amount, you can report that amount on taxmap/instr/i1040gi-010.htm#TXMP4b9ad2d1
line 16b. But you may be able to report a lower taxable amount by using the General Rule or the Simplified Method or if the exclusion for retired public safety officers, discussed next, applies.
If you are an eligible retired public safety officer (law enforcement officer, firefighter, chaplain, or member of a rescue squad or ambulance crew), you can elect to exclude from income distributions made from your eligible retirement plan that are used to pay the premiums for accident or health insurance or long-term care insurance. You can do this only if you retired because of disability or because you reached normal retirement age. The premiums can be for coverage for you, your spouse, or dependents. The distribution must be made directly from the plan to the insurance provider. You can exclude from income the smaller of the amount of the insurance premiums or $3,000. You can only make this election for amounts that would otherwise be included in your income.
An eligible retirement plan is a governmental plan that is:
- A qualified trust,
- A section 403(a) plan,
- A section 403(b) annuity, or
- A section 457(b) plan.
If you make this election, reduce the otherwise taxable amount of your pension or annuity by the amount excluded. The amount shown in box 2a of Form 1099-R does not reflect the exclusion. Report your total distributions on line 16a and the taxable amount on line 16b. Enter
PSO next to line 16b.
If you are retired on disability and reporting your disability pension on line 7, include only the taxable amount on that line and enter taxmap/instr/i1040gi-010.htm#TXMP6568b4ae
PSO and the amount excluded on the dotted line next to line 7.
Your annuity starting date is the later of the first day of the first period for which you received a payment or the date the plan's obligations became fixed.taxmap/instr/i1040gi-010.htm#TXMP092691e9
You must use the Simplified Method if either of the following applies.
- Your annuity starting date (defined above) was after July 1, 1986, and you used this method last year to figure the taxable part.
- Your annuity starting date was after November 18, 1996, and both of the following apply.
- The payments are from a qualified employee plan, a qualified employee annuity, or a tax-sheltered annuity.
- On your annuity starting date, either you were under age 75 or the number of years of guaranteed payments was fewer than 5. See Pub. 575 for the definition of guaranteed payments.
If you must use the Simplified Method, complete the worksheet on below to figure the taxable part of your pension or annuity. For more details on the Simplified Method, see Pub. 575 or Pub. 721 for U.S. Civil Service retirement benefits.
If you received U.S. Civil Service retirement benefits and you chose the alternative annuity option, see Pub. 721 to figure the taxable part of your annuity. Do not use the worksheet below.
If you are the retiree, use your age on the annuity starting date. If you are the survivor of a retiree, use the retiree's age on his or her annuity starting date. But if your annuity starting date was after 1997 and the payments are for your life and that of your beneficiary, use your combined ages on the annuity starting date.
If you are the beneficiary of an employee who died, see Pub. 575. If there is more than one beneficiary, see Pub. 575 or Pub. 721 to figure each beneficiary's taxable amount.taxmap/instr/i1040gi-010.htm#TXMP1cef9545
Your cost is generally your net investment in the plan as of the annuity starting date. It does not include pre-tax contributions. Your net investment should be shown in box 9b of Form 1099-R for the first year you received payments from the plan.taxmap/instr/i1040gi-010.htm#TXMP0eee1506
Generally, a qualified rollover is a tax-free distribution of cash or other assets from one retirement plan that is contributed to another plan within 60 days of receiving the distribution. However, a qualified rollover to a Roth IRA is not a tax-free distribution. Use lines 16a and 16b to report a qualified rollover, including a direct rollover, from one qualified employer's plan to another or to an IRA or SEP.
For more details on rollovers, including distributions under qualified domestic relations orders, see Pub. 575.taxmap/instr/i1040gi-010.htm#TXMP491e58d3
Enter on line 16a the total distribution before income tax or other deductions were withheld. This amount should be shown in box 1 of Form 1099-R. From the total on line 16a, subtract any contributions (usually shown in box 5) that were taxable to you when made. From that result, subtract the amount of the qualified rollover. Enter the remaining amount, even if zero, on line 16b. Also, enter "Rollover" next to line 16b.
Special rules apply to partial rollovers of property. See Pub. 575.taxmap/instr/i1040gi-010.htm#TXMP3e01c970
Enter on line 16a the total distribution before income tax or other deductions were withheld. This amount should be shown in box 1 of Form 1099-R. From the total on line 16a, subtract any contributions (usually shown in box 5) that were taxable to you when made. Enter the remaining amount, even if zero, on line 16b.taxmap/instr/i1040gi-010.htm#TXMP40b08b1f
If you received a lump-sum distribution from a profit-sharing or retirement plan, your Form 1099-R should have the "Total distribution" box in box 2b checked. You may owe an additional tax if you received an early distribution from a qualified retirement plan and the total amount was not rolled over in a qualified rollover. For details, see the instructions for line 59 on page 44.
Enter the total distribution on line 16a and the taxable part on line 16b. For details, see Pub. 575.
You may be able to pay less tax on the distribution if you were born before January 2, 1936, or you are the beneficiary of a deceased employee who was born before January 2, 1936. For details, see Form 4972.
You should receive a Form 1099-G showing in box 1 the total unemployment compensation paid to you in 2008. Report the amount in box 1 on line 19. However, if you made contributions to a governmental unemployment compensation program and you are not itemizing deductions, reduce the amount you report on line 19 by those contributions.
If you received an overpayment of unemployment compensation in 2008 and you repaid any of it in 2008, subtract the amount you repaid from the total amount you received. Enter the result on line 19. Also, enter taxmap/instr/i1040gi-010.htm#TXMP4b06d95dtaxmap/instr/i1040gi-010.htm#TXMP627af220
Repaid and the amount you repaid on the dotted line next to line 19. If, in 2008, you repaid unemployment compensation that you included in gross income in an earlier year, you can deduct the amount repaid on Schedule A, line 23. But if you repaid more than $3,000, see Repayments in Pub. 525 for details on how to report the repayment.
You should receive a Form SSA-1099 showing in box 3 the total social security benefits paid to you. Box 4 will show the amount of any benefits you repaid in 2008. If you received railroad retirement benefits treated as social security, you should receive a Form RRB-1099.
Use the worksheet on page 27 to see if any of your benefits are taxable.taxmap/instr/i1040gi-010.htm#TXMP58aef539
Do not use the worksheet on page 27 if any of the following applies.
- You made contributions to a traditional IRA for 2008 and you or your spouse were covered by a retirement plan at work or through self-employment. Instead, use the worksheets in Pub. 590 to see if any of your social security benefits are taxable and to figure your IRA deduction.
- You repaid any benefits in 2008 and your total repayments (box 4) were more than your total benefits for 2008 (box 3). None of your benefits are taxable for 2008. Also, you may be able to take an itemized deduction or a credit for part of the excess repayments if they were for benefits you included in gross income in an earlier year. For more details, see Pub. 915.
- You file Form 2555, 2555-EZ, 4563, or 8815, or you exclude employer-provided adoption benefits or income from sources within Puerto Rico. Instead, use the worksheet in Pub. 915.
Social Security Benefits Worksheet—Lines 20a and 20b
- Complete Form 1040, lines 21 and 23 through 32, if they apply to you.
- Figure any write-in adjustments to be entered on the dotted line next to line 36 (see the instructions for line 36 on page 34).
- If you are married filing separately and you lived apart from your spouse for all of 2008, enter "D" to the right of the word "benefits" on line 20a. If you do not, you may get a math error notice from the IRS.
- Be sure you have read the Exception on page 26 to see if you can use this worksheet instead of a publication to find out if any of your benefits are taxable.
| || |
|1.|| ||Enter the total amount from box 5 of all your Forms SSA-1099 and Forms RRB-1099. Also, enter this amount on Form 1040, line 20a ||1.|| || || || |
|2.|| ||Enter one-half of line 1||2.|| || || |
|3.|| ||Enter the total of the amounts from Form 1040, lines 7, 8a, 9a, 10 through 14, 15b, 16b, 17 through 19, and 21||3.|| || || |
|4.|| ||Enter the amount, if any, from Form 1040, line 8b||4.|| || || |
|5.|| ||Add lines 2, 3, and 4||5.|| || || |
|6.|| ||Enter the total of the amounts from Form 1040, lines 23 through 32, plus any write-in adjustments you entered on the dotted line next to line 36 ||6.|| || || |
|7.|| ||Is the amount on line 6 less than the amount on line 5?|| || |
| || || ||No.|| || None of your social security benefits are taxable. Enter -0- on Form 1040, line 20b.|| || || || |
| || || ||Yes. Subtract line 6 from line 5 ||7.|| || || |
|8.|| ||If you are: |
- Married filing jointly, enter $32,000
- Single, head of household, qualifying widow(er), or married filing
separately and you lived apart from your spouse for all of 2008,
| ||8.|| || || |
| || || |
- Married filing separately and you lived with your spouse at any time
in 2008, skip lines 8 through 15; multiply line 7 by 85% (.85) and
enter the result on line 16. Then go to line 17
| || |
|9.|| ||Is the amount on line 8 less than the amount on line 7?|| || |
| || || ||No.|| ||None of your social security benefits are taxable. Enter -0- on Form 1040, line 20b. If you are married filing separately and you lived apart from your spouse for all of 2008, be sure you entered "D" to the right of the word "benefits" on line 20a. || || |
| || || ||Yes. Subtract line 8 from line 7 ||9.|| || || |
|10.|| ||Enter: $12,000 if married filing jointly; $9,000 if single, head of household, qualifying widow(er), or married filing separately and you lived apart from your spouse for all of 2008 ||10.|| || || |
|11.|| ||Subtract line 10 from line 9. If zero or less, enter -0-||11.|| || || |
|12.|| ||Enter the smaller of line 9 or line 10 ||12.|| || || |
|13.|| ||Enter one-half of line 12||13.|| || || |
|14.|| ||Enter the smaller of line 2 or line 13 ||14.|| || || |
|15.|| ||Multiply line 11 by 85% (.85). If line 11 is zero, enter -0-||15.|| || || |
|16.|| ||Add lines 14 and 15||16.|| || || |
|17.|| ||Multiply line 1 by 85% (.85)||17.|| || || |
|18.|| ||Taxable social security benefits. Enter the smaller of line 16 or line 17. Also enter this amount on Form 1040, line 20b ||18.|| || || |
| ||If any of your benefits are taxable for 2008 and they include a lump-sum benefit payment that was for an earlier year, you may be able to reduce the taxable amount. See Pub. 915 for details.|| |
Do not report on this line any income from self-employment or fees received as a notary public. Instead, you must use Schedule C, C-EZ, or F, even if you do not have any business expenses. Also, do not report on line 21 any nonemployee compensation shown on Form 1099-MISC. Instead, see the chart on page 11 to find out where to report that income.
Use line 21 to report any income not reported elsewhere on your return or other schedules. See the examples below. List the type and amount of income. If necessary, show the required information on an attached statement. For more details, see Miscellaneous Income in Pub. 525.
Do not report any nontaxable amounts on line 21. Nontaxable amounts include:
- Child support.
- Economic stimulus payments.
- Life insurance proceeds received because of someone's death (other than from certain employer-owned life insurance contracts).
- Gifts and bequests. However, if you received a gift or bequest from a foreign person of more than $13,561, you may have to report information about it on Form 3520, Part IV. See the instructions for Form 3520.
Examples of income to report on line 21 are:
- Taxable distributions from a Coverdell education savings account (ESA) or a qualified tuition program (QTP). Distributions from these accounts may be taxable if (a) they are more than the qualified higher education expenses of the designated beneficiary in 2008, and (b) they were not included in a qualified rollover. See Pub. 970. Nontaxable distributions from these accounts, including rollovers, do not have to be reported on Form 1040. Withdrawal of an economic stimulus payment that was directly deposited to your account is not taxable if withdrawn by the due date (including extensions) of your 2008 return. For a Coverdell ESA, the withdrawal can be made by the later of the above date or June 1, 2009.
You may have to pay an additional tax if you received a taxable distribution from a Coverdell ESA or a QTP. See the Instructions for Form 5329.
- Taxable distributions from a health savings account (HSA) or an Archer MSA. Distributions from these accounts may be taxable if (a) they are more than the unreimbursed qualified medical expenses of the account beneficiary or account holder in 2008, and (b) they were not included in a qualified rollover. Withdrawal of an economic stimulus payment that was directly deposited to your account is not taxable if withdrawn by the due date (including extensions) of your 2008 return. See Pub. 969.
You may have to pay an additional tax if you received a taxable distribution from an HSA or an Archer MSA. See the Instructions for Form 8889 for HSAs or the Instructions for Form 8853 for Archer MSAs.
- Amounts deemed to be income from an HSA because you did not remain an eligible individual during the testing period. See Form 8889, Part III.
- Prizes and awards.
- Gambling winnings, including lotteries, raffles, a lump-sum payment from the sale of a right to receive future lottery payments, etc. For details on gambling losses, see the instructions for Schedule A, line 28, on page A-10.
Attach Form(s) W-2G to
Form 1040 if any federal income tax was withheld.
- Jury duty pay. Also, see the instructions for line 36 on page 34.
- Alaska Permanent Fund dividends.
- Alternative trade adjustment assistance (ATAA) payments. These payments should be shown in box 5 of Form 1099-G.
- Reimbursements or other amounts received for items deducted in an earlier year, such as medical expenses, real estate taxes, general sales taxes, or home mortgage interest. See in Pub. 525 for details on how to figure the amount to report.
- Income from the rental of personal property if you engaged in the rental for profit but were not in the business of renting such property. Also, see the instructions for line 36 on page 34.
- Income from an activity not engaged in for profit. See Pub. 535.
- Loss on certain corrective distributions of excess deferrals. See in Pub. 525.
- Dividends on insurance policies if they exceed the total of all net premiums you paid for the contract.
- Recapture of a charitable contribution deduction relating to the contribution of a fractional interest in tangible personal property. See in Pub. 526. Interest and an additional 10% tax apply to the amount of the recapture. See the instructions for line 61 on page 45.
- Recapture of a charitable contribution deduction if the charitable organization disposes of the donated property within 3 years of the contribution. See in Pub. 526.
- Canceled debts. These amounts may be shown in box 2 of Form 1099-C. However, part or all of your income from the cancellation of debt may be nontaxable. See Pub. 4681 or go to www.irs.gov and enter
canceled debt or
foreclosure in the search box.