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Share-TAX/1040 (tm) for 1991 U S E R ' S M A N U A L Bammel Software P.O. Box 382194 Duncanville, TX 75138-2194 214-296-8518 (voice, FAX & BBS) (for FAX press your SEND key) DISCLAIMER THIS PROGRAM IS PROVIDED "AS IS", WITH NO WARRANTY OF ANY KIND, EXPRESS OR IMPLIED, AND IN NO EVENT WILL BAMMEL SOFTWARE OR ANY INDIVIDUAL CONNECTED WITH BAMMEL SOFTWARE BE LIABLE FOR DIRECT, INDIRECT, INCIDENTAL, OR CONSEQUENTIAL DAMAGES RESULTING FROM THE USE OF THIS PROGRAM. BAMMEL SOFTWARE, AND ALL INDIVIDUALS CONNECTED WITH BAMMEL SOFTWARE, SPECIFICALLY DISCLAIM THE ROLE OF TAX ADVISER. THIS PROGRAM ONLY PERFORMS THE MECHANICS OF TAX PREPARATION IN STRICT ACCORDANCE WITH IRS FORMS AND INSTRUCTIONS. THE USER MUST EXERCISE JUDGEMENT AS TO THE CORRECTNESS AND APPROPRIATENESS OF ANY AND ALL AMOUNTS ENTERED USING THIS PROGRAM, JUST THE SAME AS IN FILLING OUT THE IRS FORMS MANUALLY. (C) Copyright 1991, Bammel Software. All Rights Reserved. C O N T E N T S 1. FEATURES and BENEFITS 1.1. What it Does 1.2. Ease of Use 1.3. Forms not Provided by the Program 1.4. Getting an Early Start on your Tax Return 1.5. Dollars and Cents, versus Whole-dollar Amounts 1.6. Next Year's Version 2. PRODUCT SUPPORT 3. SOFTWARE LICENSE 4. DUPLICATION and DISTRIBUTION of Share-TAX/1040 5. INSTALLATION and RUNNING THE PROGRAM 5.1. Machine Requirements 5.2. Using the INSTALL Program 5.3. Installing Upgrades 5.4. Running the Program from Diskette 5.5. Running the Program from Hard Disk 5.6. Exiting from the Program 5.7. Setting Screen Options 5.8. Setting Printer Options 6. GENERAL INSTRUCTIONS 6.1. Taxpayer Lookup 6.2. Keyboarding Conventions 6.3. Screen Selectors and Multiple-instance Screens 6.4. Data Entry Fields 6.5. Calculated Data Fields 6.6. Calculations 6.7. Data Records 6.8. Multiple Versions of Data 6.9. List of Screens with their Names 7. SCREEN-SPECIFIC INSTRUCTIONS 7.1. Form 1040 - U.S. Individual Income Tax Return 7.2. Schedule A - Itemized Deductions 7.3. Schedule B - Interest and Dividend Income 7.4. Schedule C - Profit(Loss) from Business/Profession 7.5. Schedule D - Capital Gains and Losses 7.6. Schedule E - Supplemental Income Schedule 7.7. Schedule F - Farm Income and Expenses 7.8. Schedule R - Credit for Elderly and Disabled 7.9. Schedule SE - Social Security Self-Employment Tax 7.10. Form 2106 - Employee Business Expenses 7.11. Form 2119 - Sale/Exchange of Principal Residence 7.12. Form 2210 - Underpayment of Estimated Tax 7.13. Form 2441 - Child/Dependent Care Expense Credit 7.14. Form 3903 - Moving Expense 7.15. Form 4137 - S.S. Tax on Unreported Tip Income 7.16. Form 4562 - Depreciation and Amortization 7.17. Form 6251 - Alternative Minimum Tax - Individuals 7.18. Form 8606 - Non-deductible IRA Contributions 7.19. Form 8615 - Under 14, Investmt Income over $1100 (C) Copyright 1991, Bammel Software. All Rights Reserved. 7.20. Worksheet - W-2 Forms Wage Information 7.21. Worksheet - Schedule of Other Income 7.22. Schedule EIC - Earned Income Credit 7.23. Worksheet - Taxable Part of Pensions/Annuities 7.24. Worksheet - Taxable Social Security Benefits 7.25. Worksheet - IRA Contributions 7.26. Supplemental Schedules 7.27. Client Invoice 8. PRINTING 8.1. Printing Individual Forms 8.2. IRS-Approved Form 1040 on LASER Printer 8.3. IRS-Approved Form 1040 on Dot Matrix Printer 8.4. Precautions for printing to a file 8.5. IRS Approval of Substitute Forms 8.6. IRS Requirements for Computer-Generated Forms 8.7. Calculation Before Printing 8.8. Printing to the Screen 8.9. Printing to a File 9. TAX PREPARER INFORMATION 10. EXCEPTION REPORT MESSAGES (C) Copyright 1991, Bammel Software. All Rights Reserved. Share-TAX/1040 Page 1 1. FEATURES and BENEFITS 1.1. What it Does Using the data you enter, Share-TAX/1040 does all computations and prints out your complete tax return ready to submit to the IRS. If you have a compatible LASER or dot-matrix printer, you can print a graphic image of the official Form 1040 which is IRS approved for inclusion in your tax return. For all schedules and forms other than Form 1040, it prints IRS-approved substitute forms. It frees you from the drudgery of manually filling in the forms and manual calculations. The ease with which you can try out various combinations and situations adds a new dimension to tax preparation as compared to manual methods. 1.2. Ease of Use You need only enter the correct numbers, and Share-TAX/1040 will do all computations for you, forwarding amounts from one form to another as necessary. It displays and follows IRS forms as closely as possible so that you can see and understand clearly what is happening and so that you can make the proper judgements. The order in which you enter your data is completely arbitrary, and you can at any time suspend your data entry to work on a different tax return or exit the program. Then later you can resume where you left off. 1.3. Forms not Provided by the Program If you need additional forms not provided by the program, simply fill out these forms manually and enter the total(s) to the proper form in the program. Then submit the manually prepared forms along with those produced by the program. 1.4. Getting an Early Start on your Tax Return As you begin receiving your tax information, you can get an early start on your taxes by entering it as soon as you receive it. At that point, by estimating the numbers you don't have yet, you can get an early idea of what your tax bite is going to be. Later, when you receive those last few missing numbers, you can enter them and in a few moments have your complete tax return ready to submit to the IRS. 1.5. Dollars and Cents, versus Whole-dollar Amounts The IRS permits you to enter your money amounts either as dollars and cents, or as rounded whole-dollar amounts, but whichever you choose, you must use it consistently throughout your return. It is our understanding that the IRS probably prefers whole-dollar amounts since it slightly eases their data entry. (C) Copyright 1991, Bammel Software. All Rights Reserved. Share-TAX/1040 Page 2 However, the IRS requires that when adding up amounts for a single entry on a form, that dollars and cents be used, and that rounding to whole dollars be done only after the addition. That is the reason why a few forms in Share-TAX/1040 have dollars and cents, in particular the W-2 worksheet and the Supplemental Schedule. But you will notice that the totals are shown in whole dollars. 1.6. Next Year's Version Next year's version is not expected to be ready before early January, 1993. This is due to the fact that final IRS forms are usually released late. However, the IRS usually releases preliminary forms in June or July. Therefore, we expect to have a PRELIMINARY version of the program ready in July or August, 1992. Even though you will not be able to use the preliminary version to file your 1992 tax, it should be very useful for tax planning because it will utilize the 1992 tax rates. 2. PRODUCT SUPPORT Voice, FAX and BBS is provided at 214-296-8518. The voice system will guide you through placing an order or leaving a message. To send a FAX, just press the SEND key on your FAX. If for some reason that does not work, you can also press "77#" anytime after the voice answer to activate our FAX. To access the BBS, press "6" after the voice answer. When the answering modem carrier tone comes up about 10 seconds later, follow normal login instructions. You should be able to automate your BBS access with the following modem command: "ATDT214-296-8518,,,6,6,6,6,6,6", where each comma gives 2 seconds of delay. If you are using a dialing program, you can just enter the following as the phone number: "214-296-8518,,,6,6,6,6,6,6". The reason for more than one "6" is because sometimes the first one is not recognized due to timing or being drowned out by voice audio. If it takes a long time to connect your call from your location, your modem may time out before the answering carrier comes up. (Most modems will time out 30 seconds after initiation of the call.) To prevent this, first enter the following command to your modem: "ATS7=55". This will set the timeout for waiting for carrier to 55 seconds (maximum on most modems). You may also need to add a few more commas to the group of commas. Furthermore, if you use a communications program which automatically re-dials, you must set it to wait more than 30 seconds before re-trying. You also need to be sure your communications program and modem are set to 1200 or 2400 baud with no parity, 8 data (C) Copyright 1991, Bammel Software. All Rights Reserved. Share-TAX/1040 Page 3 bits and one stop bit (usually denoted "N81"). You can download the latest version of Share/TAX-1040 from the BBS. You can also place an order or pay the shareware fee by leaving a message for the SYSOP giving your name, address and credit-card number on the BBS. The BBS will be online only during tax season (November 1 through April 15). During tax season, it will normally be up 24 hours per day, 7 days a week. However, there will be brief periods when it is down for maintenance or other reasons. 3. SOFTWARE LICENSE Share-TAX/1040 (tm) software and reference materials are the sole property of Bammel Software and are protected by U.S. Copyright Law. Share-TAX/1040 is a trademark of Bammel Software. You are granted permission to copy Share-TAX/1040 for use in preparing and reviewing actual tax returns and for tax planning and estimating only if you pay promptly as follows: Right to use Share-TAX/1040 on one computer..... $15.00 (Texas residents please add 7.25% sales tax) This fee is due when you start using it, and payable to: Bammel Software P.O. Box 382194 Duncanville, TX 75138-2194 TO EVERYONE WHO PAYS THIS SHAREWARE FEE WE WILL SEND THE 1992 Share-TAX/1040 AS A FREE THANK-YOU BONUS IN EARLY JANUARY 1993. 4. DUPLICATION and DISTRIBUTION of Share-TAX/1040 Share-TAX/1040 is provided on the basis of the "Shareware" concept, and you are granted permission to copy it freely for evaluation and distribution purposes without paying a fee under the following conditions, but it is not free nor is it in the public domain. You are encouraged to make copies of Share-TAX/1040 for your friends and acquaintences. Shareware distributors are encouraged to distribute this program. Operators of electronic bulletin board systems are encouraged to post this program for downloading by their users. Permission is hereby granted to copy and distribute Share-TAX/1040, for profit or otherwise, provided all the following conditions are met: 1) Share-TAX/1040 must be copied and distributed in unmodified form, complete with copyright notices, licensing information and all documentation. (C) Copyright 1991, Bammel Software. All Rights Reserved. Share-TAX/1040 Page 4 2) A reasonable fee may be charged for duplication and distribution services, but no fee may be charged for use of the program. (Fees for the use of the program are payable only to the copyright owner, Bammel Software.) 3) Share-TAX/1040 may not be distributed in conjunction with any other product. Copying for any other purpose is expressly prohibited. The files which must be included for a complete copy are: READ.ME Information file ORDER.FRM A blank order form INSTALL.EXE The installation program STAX91.DOC The User's Manual (this file) STAX91.EXE The executable program T91PT.SCH Data files T91SC.DAT " T91SC.KEY " T91PR.DAT " TOPTN.DAT " DOT1040.EXE Graphic 1040 on dot-matrix 1040.HP2 1040 laser forms 5. INSTALLATION and RUNNING THE PROGRAM 5.1. Machine Requirements Share-TAX/1040 needs approximataely 320K of free memory (that is memory remaining after subtracting that used by DOS and any resident utilities), and at least one diskette drive with a minimum capacity of 360K. A hard disk is of course nice, but operation is quite acceptable on diskette. It is not expected that there be any problem in operating the program with any of the commonly used resident utilities. However if you have any difficulties in running the program with any such utilities installed, you should de-install them while running this program. 5.2. Using the INSTALL Program Place the original diskette in drive "A:" or "B:". Then at the DOS prompt, type "A:INSTALL" or "B:INSTALL", respectively. The installation program will ask you if you are installing on a hard disk or not. If to a hard disk, it will create the necessary directory, and will check for previous installations of the program to prevent accidental overwriting of previously entered data. If to a diskette, it will simply make a duplicate with the DOS DISKCOPY program. To prevent accidental erasure of your original diskette, be sure it has a write-protect tab on it before inserting it into the diskette drive. It is NOT recommended that you run Share-TAX/1040 from the original diskette. Always run the program from a copy. (C) Copyright 1991, Bammel Software. All Rights Reserved. Share-TAX/1040 Page 5 5.3. Installing Upgrades Use the INSTALL program as described in the previous section. It will check for previously installed versions and prevent accidental erasure of data files. NOTE: The data files used by the PRELIMINARY version are NOT COMPATIBLE with the final version. There were just too many changes to the forms for compatability to be feasible. 5.4. Running the Program from Diskette Put the diskette made by the Installation Program in drive "A:" or "B:". Then at the DOS prompt type "A:" or "B:" to make the diskette the current drive. Then type "STAX91" at the DOS prompt to run Share-TAX/1040. To obtain maximum working space on the run diskette, delete all files BUT: STAX91.EXE T91PR.DAT T91PT.SCH T91SC.DAT T91SC.KEY TOPTN.DAT DOT1040.EXE (keep only for dot-matrix 1040) 1040.HP2 (keep only for laser printer) For even more diskette work space, place STAX91.EXE on another diskette drive if available. WARNING: If while running the program, the diskette fills up and runs out of space, the data files will likely be DAMAGED or DESTROYED. Therefore, it is important to backup regularly and to check from time to time how much space is left, and to limit the number of tax returns per diskette to a safe margin. As a rule of thumb, a very complicated tax return will take on the order of 20K of disk space. 5.5. Running the Program from Hard Disk Make the drive and directory where you installed Share-TAX/1040 your default. (example: Type "C:", and then "CD \STAX91"). Then run the program by typing: "STAX91". The same warning about disk space applies to hard disks as well as diskettes, but usually there will be much more free space on a hard drive, with little likelihood of running out from the operation of the program. 5.6. Exiting from the Program It is very IMPORTANT that you exit from the program through the EXIT screen BEFORE powering down or booting (using CTRL-ALT-DEL or otherwise). IF YOU FAIL TO EXIT PROPERLY, YOUR DATA FILES MAY BE IRREPARABLY DAMAGED. (C) Copyright 1991, Bammel Software. All Rights Reserved. Share-TAX/1040 Page 6 5.7. Setting Screen Options To select the colors you want, go to the COLOR screen. Then use the cursor keys to position to the desired item, and press the F and B keys to change foreground and background colors, respectively. The colors selected will be automatically stored on disk in the current directory so that you will get them next time you run the program. The COLOR screen also allows you to select the method for displaying data on the screen. The default screen output is via BIOS which is the most compatible with different types of hardware, but is also the slowest. The next option is faster and is designed for use on CGA adapters prone to "snow". The last option is the fastest, and it writes directly to screen memory at maximum speed with no waits. The COLOR screen also has a color/monochrome selection. This is actually implemented by simply providing two sets of colors, and you can change either or both as you choose. IF YOU HAVE A MONOCHROME SCREEN, in order to read the screen clearly, you can start up the program in monochrome mode by running with the -B option (run it by typing "STAX91 -B" at the DOS prompt). This may not be necessary with all monochrome CRTs, but is likely to be quite necessary with some laptops. You should then select "monochrome" on the COLOR screen, and next time you run the program it will remember your preferences. If you ever mess up the colors so badly that you cannot read the screen well enough to correct it (this is not an entirely unlikely possibility with some laptops), you can recover by copying ONLY the file TOPTN.DAT from your distribution diskette to your working diskette/directory. If you have altered other options, they will be reset also, and you will have to re-enter them. However, your tax-return data will not be affected. 5.8. Setting Printer Options To select the printer options you want, go to the "PRSU" screen and press the F2 key and select your printer type. As delivered, the printer control sequences are set up for the IBM Proprinter. If your printer is not included in the list, you will need to enter the appropriate sequences as defined in your printer's manual. If your printer does not have a bold printing capability, the program can simulate it by overstriking. To activate this option, answer "Y" to the bold question and leave the control sequences blank. If your printer does not have an underlining capability, you must use ruled or color-barred paper. Without an underlining capability, answering "Y" to the underling question has no effect. (C) Copyright 1991, Bammel Software. All Rights Reserved. Share-TAX/1040 Page 7 Note that for printer control sequences, NON-DISPLAYING ASCII characters must be entered as a two-character sequence where the first character is always a "^". For example, a control-C is entered as "^C", an escape followed by the character 0 as "^[0". This two-character notation is shown on the screen along with the decimal equivalents in parentheses. The decimal equivalents are given only for your information and are not entered as such in the control sequences. They are the values you would use with the CHR$ function of BASIC and are given in many printer manuals. 6. GENERAL INSTRUCTIONS 6.1. Taxpayer Lookup As delivered, the data files contain a sample tax return. You probably will not want to enter data into this tax return, but will want to create new ones for your use. You can also erase it entirely if you choose. Multiple tax returns may be stored in one set of files, and are identified by a "REF" (reference) number. Each tax return also has a 6-character search key for easy lookup when you can't remember the number. You enter the key as you choose, hopefully with a value which you can easily remember, and which will fall in a natural alphabetical sequence. When you need to select a tax return a window will pop up on the screen. Use the arrow keys to select the desired tax return or type in the reference number directly. When you have made your selection, press the Enter key to complete it. If you do not wish to select a tax return at this time, press the ESC key. In this case, the program will enter a display-only mode and will just display the text of the screens with no data. To select a tax return after entering this mode, just press F1 for the Menu window again. 6.2. Keyboarding Conventions Normally a field is cleared when you type the first character. However, you can edit the previous contents of any field by making the first character an editing key (identified below with an asterisk). The function and editing keys normally act as follows (the notation "^" means hold down the Control key, then press the specified key): F1 Pop up the MENU window. Use the cursor keys to select the item you want, or type the name of the screen directly. F2 Generally, this key is used to search for something, such as a tax return or a particular instance of a screen. Follow prompts on screen for instructions. F3 Allows erasing a "record" (see below). F4 Prints a form or complete tax return. F5,PGUP Go to previous screen. F6,PGDN Go to next screen. (C) Copyright 1991, Bammel Software. All Rights Reserved. Share-TAX/1040 Page 8 F7,Shift-TAB Move to data-entry field to left. F8,TAB Move to data-entry field to right. F9,Up-Arrow Move up rows. F10,Down-Arrow Move down rows. ^HOME Go to the first data-entry field on the screen. ^END Go to the last data-entry field on the screen. * Left-Arrow Move one colum to the left. * Right-Arrow Move one column to the right. * ^Left-Arrow Move to beginning of the word to left. * ^Right-Arrow Move to beginning of the word to right. * HOME Go to beginning of the data-entry field. * END Go to end of the data-entry field. * INSERT Toggle between insert and overstrike mode. * DELETE Delete the key under the cursor. * BACKSPACE Delete the key to the left of the cursor and move the cursor one to the left. * ^BACKSPACE Clear the data-entry field. ESC Cancel changes keyed before pressing ENTER. ENTER Enter changes keyed. In most cases it sequences through the fields the same as the TAB key, but in some cases it follows a more natural order. (* Field editing keys are indicated with an asterisk.) The reason for duplicating some of the functions with function keys is for the convenience of those who do not have an enhanced keyboard and who like to enter their numbers using the number pad. 6.3. Screen Selectors and Multiple-instance Screens Certain IRS forms may need to be filed more than once in a single tax return. There are two basic classes of these forms, namely those which have no fixed number (such as W-2's and Schedule C), and those which must be filed separately for Taxpayer and Spouse in joint returns (such as Schedule SE). Those with no fixed number are selected with letters "A" thru "Z", giving a maximum of 26. Those for taxpayer/spouse are selected with "T" or "S". To re-select with a different letter, use the "SEARCH" function, F2. 6.4. Data Entry Fields There are two types of data-entry fields, numeric and text. If you try to enter text in a numeric field, the program will complain and not accept it. Most single-character text fields are "YES"/"NO" fields. Enter "Y", "y" or "1" for "Yes", and "N", "n" or "2" for "No". A Few single-character text fields are "Taxpayer"/"Spouse" fields. Enter "T", "t" (or sometimes blank) for "Taxpayer", and "S" or "s" for "Spouse". The few other types of single character fields are identified as such on the screen. Dates can be entered with or without the slashes, for example "10188" or "01/01/88" or "1/1/88", and the program will then enter the slashes correctly. Date fields will also accept arbitrary text which does not look like a date such as (C) Copyright 1991, Bammel Software. All Rights Reserved. Share-TAX/1040 Page 9 "VARIOUS". The philosophy used throughout the program is that data entry fields are never changed by the calculations. A minor exception to this is a few fields which must always be positive or negative. In most of these cases, the program forces the necessary polarity. 6.5. Calculated Data Fields Data in these fields are calculated by the program and you cannot position the cursor to these fields. If you have chosen colors properly, these fields will have a different color (or shading with some monochrome monitors) from the data entry fields, and the background text. 6.6. Calculations Every effort is made to keep values passed from one form to another current. However, in the interest of efficiency, this cannot always be done. To bring all values up to date at any time, just select the "CALC" function. This takes just a few seconds with a hard disk, and something like 30 seconds on diskette for a large return. During the calculations, an "Exception Report" is displayed on the screen warning you of any obvious problems. This report can also be printed. 6.7. Data Records Data is organized in the files as "records". In some cases one screen constitutes one record, whereas in other cases a number of screens constitute one record. The "ERASE" function erases records, not screens. Therefore, the erase function will first inform you of the scope of the proposed erasure before asking you to confirm. In order to conserve disk space, data is organized so that zero-valued numeric amounts and blank-valued text do not occupy space in the file. Furthermore, records are not created until data has been entered, or in a few cases where the calculations automatically create records when necessary. At the upper-right corner of the screen, you will at times see and "R" and a "M". The "R" means that the record has been created. The "M" means that the screen has been modified with new data, and if the record has not been created yet, it will be created when you leave the screen. 6.8. Multiple Versions of Data Sometimes you might want to try out several situations for a given tax return. You could create a new tax return and re-enter all the data again, but that is quite a bother. A more efficient way is to enter data up to the point you want to make a second copy. Then copy the data files (T91PT.SCH, T91SC.DAT, T91SC.KEY, T91PR.DAT and TOPTN.DAT) to a new directory or diskette. Then by selecting which directory you (C) Copyright 1991, Bammel Software. All Rights Reserved. Share-TAX/1040 Page 10 run from, you can have more than one version of a tax return without entering the bulk of the data more than once. 6.9. List of Screens with their Names The pop-up menu window displays the names of all the screens. The complete list of screens with their names is as follows: SIGN Sign-on Message DISCL Disclaimer DIST Distribution of Program SUPP Product Support INSTR General Instructions INST2 (continued) COLOR Screen Color Setup PRSU Printer Selection PRSU2 Custom Printer Setup ORDER Order Blank ORD2 (continued) PREP Preparer Setup TPI Taxpayer Information W2 Individual W-2 Forms W2T W-2 Form Totals W2X Excess SS/Medicare Tax Withheld OI Other Income EIC Sch EIC - Earned Income Credit EIC2 Sch EIC - Qualifying Children EIC3 Sch EIC - Basic Credit EIC4 Sch EIC - Health Ins/Extra Credit WP Pension/Annuity Worksheet WP2 (continued) WS Social Security Worksheet WI IRA Worksheet Data Entry WI1 IRA Worksheet 1 WI2 IRA Worksheet 2 WI2N IRA Worksheet 2, Non-working spouse E 1040 Exemptions I 1040 Income A 1040 Adjustments to Income T 1040 Tax Computation C 1040 Credits O 1040 Other Taxes P 1040 Payments & Refund/Amount Due AM Sch A - Medical expenses AT Sch A - Taxes paid AI Sch A - Interest paid AC Sch A - Gifts to Charity AO Sch A - Other expenses BI Sch B - Interest income BD Sch B - Dividend income BF Sch B - Foreign accounts CN Sch C - Business name CI Sch C - Income CD Sch C - Deductions CC Sch C - Cost of goods DS Sch D - Short-term gain(loss) DS2 Sch D - Short-term continued (C) Copyright 1991, Bammel Software. All Rights Reserved. Share-TAX/1040 Page 11 DL Sch D - Long-term gain(loss) DL2 Sch D - Long-term continued DSUM Sch D - Summary of Parts I & II DT Sch D - Max Cap Gains Tax Rate DC Sch D - Loss carryovers DR Sch D - 1099-B reconciliation ER Sch E - Rent/royalty income ET Sch E - Totals EP Sch E - Partnerships/S Corp EE Sch E - Estates & Trusts ES Sch E - Summary FN Sch F - Farm proprietor name FI Sch F - Farm income, cash meth FE Sch F - Farm expenses FT Sch F - Farm total income (loss) FA Sch F - Farm income, accrual RQ Sch R - Questionnaire RC Sch R - Credit Computation RW Sch R - Credit Limit Worksheet SE Sch SE - Self-Employment ST Sch SE - SE Tax Computation SO Sch SE - Optional Methods 2106 Employee Business Expense 2106B (continued) 2106C Vehicle Expenses 2106D (continued) 2106E Depreciation of Vehicles 2119 Sale/Exchange of Residence 2119B (continued) 2119C (continued) 2210 Penalty - Reasons for Filing 2210B Previous Year Amts 2210C Figuring the Underpayment 2210D (continued) 2210E Figuring the Penalty 2441 Child/Dependent Care Expenses 2441B (continued) 2441C Employer-paid Dependent Care 2441D Credit Limitation Worksheet 3903 Moving Expenses 3903B (continued) 3903C (continued) 4137 SS Tax on Unreported Tips 4137B (continued) 4562 Sec 179 Property 4562B MACRS Depreciation 4562C Other Deducts/Amortization 4562D Listed Property 4562E Vehicle Use 4562F Amortization 6251 Alternative Minimum Tax 6251B (continued) 6251C (continued) 8606 Nondeductible IRA Contrib 8615 Tax for Under Age 14 with over 8615B $1100 investment income 8615C (continued) SS Supplemental Schedule (C) Copyright 1991, Bammel Software. All Rights Reserved. Share-TAX/1040 Page 12 EST Estimated Tax Worksheet EST2 (continued) INV Client Invoice CALC Complete Tax Return Calculation P1040 Print Form 1040 PRDOT Print 1040 on Dot Matrix PRALL Print Complete Return EXIT Exit to DOS 7. SCREEN-SPECIFIC INSTRUCTIONS The following is specific instructions for individual screens. Explanation will be given only for items which are not self-explanatory, and only with the purpose of helping you understand the mechanics of data entry. No attempt will be made to explain or analyze the IRS regulations; such information is available directly from IRS publications and other sources. 7.1. Form 1040 - U.S. Individual Income Tax Return The Taxpayer Information screen (TPI) must be filled out first to setup the tax return. Some fields on this screen do not apply to all types of filing status; just leave those fields blank. Be sure to enter your basic exemptions and dependents on the front of Form 1040 (screen E). Then be sure to check any boxes on the back which apply to you (screen T). Most numbers on Form 1040 come automatically from other forms. For the few which don't come from other forms, it is a very good idea to step through all 1040 screens to be sure that you have entered all necessary amounts. The line 30 writein amount is tagged onto the end of the description for that item in preparation for printing it out. You should make any necessary adjustments to the description at the time of data entry. The tax computation (screen T) will automatically choose the larger of your itemized deductions from Schedule A, or the Standard Deduction so that your taxable income will be minimum. The value chosen is displayed on the right. You can also override the automatic selection and choose Schedule A even if less than the Standard Deduction. 7.2. Schedule A - Itemized Deductions If you have filled in Schedule A it will always print whether it or the Standard Deduction is chosen. If you do not want it to print, erase it, or else simply do not submit it with your return if it does not apply. The charitable contributions section has a worksheet to provide convenient data entry and to limit the deduction to the amount allowed by the IRS. Usually the deductible amount is 50% of your Adjusted Gross Income (AGI), and therefore (C) Copyright 1991, Bammel Software. All Rights Reserved. Share-TAX/1040 Page 13 that is the default if you don't enter a different value, but in certain cases the limit is 30% or 20%. In figuring the limitation, first the 50% deductible amounts are computed, then the 30% and and last the 20% ones. Then the allowable deductions are first applied to contributions made in cash or by check, next to contributions other than cash, and finally to carryovers from prior years. 7.3. Schedule B - Interest and Dividend Income The IRS instructions say that if you had over $400 in TAXABLE interest income, then you must list ALL interest you received, and to include on Form 1040, line 8a only the taxable interest, and on line 8b tax-exempt interest. Usually most interest will be taxable, and for taxable interest you can just skip through (i.e. leave zero) the column "Amount tax-exempt". If some or all of the interest is tax-exempt, enter that amount in the "Amount tax-exempt" column. Similarly, the dividend screen has a "non-taxable" column. 7.4. Schedule C - Profit(Loss) from Business/Profession You can have up to 26 Schedules C, one for each letter of the alphabet. Note that each Schedule C pertains to only one individual, even if you are filing a joint return. If both you and your spouse have income from the same business, you should file a separate Schedule C for each person. You generally may deduct only 80% of your business-related meal and entertainment expenses; however, there are exceptions. Therefore line 24b is entered as two amounts. The first amount, "Meals not subj 80%", is the portion which is not subject to the 80% limitation. The second amount, "Amt subj 80% limit", is that amount which is subject to the 80% limitation. 7.5. Schedule D - Capital Gains and Losses This year, there is a new section on the back of Schedule D for computing tax when the Maximum Capital Gains Tax rate applies. The program will use this automatically if you have sufficient capital gains. 7.6. Schedule E - Supplemental Income Schedule Schedule E allows up to three properties per front page. If you enter more than three, then additional front pages will be printed, with totals for all front pages only on the last front page. Each side of Schedule E can stand alone, so that if only the front is needed, the back will not be printed, and vice versa. The way Schedule E is designed, the descriptions of "Other" on each front page apply to three properties. The screen only shows one property at a time. Therefore, in order to prevent you from entering conflicting descriptions, the descriptions if any, from the other two properties are (C) Copyright 1991, Bammel Software. All Rights Reserved. Share-TAX/1040 Page 14 displayed for you in their proper place, and you are not permitted to change them. The only way to change them is to (re)select the screen where you originally typed them in. 7.7. Schedule F - Farm Income and Expenses This schedule is analogous to Schedule C, except that it is for farm income and expenses. As with Schedule C, you can have up to 26 Schedules F, one for each letter of the alphabet. Note that each Schedule F pertains to only one individual, even if you are filing a joint return. If both you and your spouse have income from the same farm, you should file a separate Schedule F for each person. If the back of Schedule F is not needed, it will not be printed as per IRS instructions. 7.8. Schedule R - Credit for Elderly and Disabled Under certain circumstances, you must complete Form 6251 for the Schedule R worksheet. If this is necessary and you have not already done so, you will be warned on the Exception Report that you need to fill in Form 6251. 7.9. Schedule SE - Social Security Self-Employment Tax This form is created automatically if you have self-employment income. You need fill it in only if you have partnership (Form 1065) self-employment income, if you use the optional method, or if you need to make adjustments to lines 1 and/or 2 (seldom needed). Only the Long Schedule SE is programmed, which will serve in all cases; just don't fill out the parts which don't apply. 7.10. Form 2106 - Employee Business Expenses Data-entry is self-explanatory. 7.11. Form 2119 - Sale/Exchange of Principal Residence The reason you are asked to indicate whether this transaction is short-term or not is so that the program will know which section of Schedule D to put the result. If you indicate that you have filled out a Form 6252 for this transaction, then the result will not be passed to Schedule D or anywhere else, and you will need to fill out Form 6252 (Form 6252 is not in the program and must be filled out manually, and any amounts will need to be entered manually on Schedule D on the appropriate line for Form 6252). If you need to file this form separately (not attached to your tax return) so that you need to sign it, use an original form from the IRS. (C) Copyright 1991, Bammel Software. All Rights Reserved. Share-TAX/1040 Page 15 7.12. Form 2210 - Underpayment of Estimated Tax The second screen is data entry of amounts from your 1990 tax return, and does not print. DO NOT ENTER YOUR 1991 DATA ON THIS SCREEN, as it only computes a value for your last year's tax. The third screen starts the form proper. Most values are obtained from elsewhere on your tax return. Be sure to enter the missing values if necessary. Be sure to enter on the fourth screen your estimated tax payments. Include as one of these payments any overpayment from your 1990 return that you elected to apply to your 1991 estimated tax. If you believe you qualify for a waiver, enter the amount of the penalty to be waved on the last screen and attach an explanation. If you file your return on or before 1/31/92 and pay all tax due, there is no penalty charged for the period 1/16/92 thru 1/31/92. In such a case enter your data as if your last installment was paid on 1/15/92 so that the program will not compute a penalty for this period. Only the long method has been programmed, which will serve in all cases. 7.13. Form 2441 - Child/Dependent Care Expense Credit Under certain conditions, you must fill in Form 6251 to complete the worksheet for this form. In such a case, you will be warned on the Exception Report to complete Form 6251 if you have not done so already. 7.14. Form 3903 - Moving Expense Data-entry is self-explanatory. 7.15. Form 4137 - S.S. Tax on Unreported Tip Income Data-entry is self-explanatory. 7.16. Form 4562 - Depreciation and Amortization You can have up to 26 Forms 4562 (one for each letter of the alphabet) since each business or activity needs a separate form. THE TOTALS FROM THESE FORMS DO NOT AUTOMATICALLY CARRY TO ANY OTHER FORM. Therefore, you must enter the totals to the appropriate forms. 7.17. Form 6251 - Alternative Minimum Tax - Individuals This form will be automatically computed whether you have filled it in or not. If you have not filled it in, and the calculations show that tax is due from the form, you will be advised on the Exception Report that "You may need to file Form 6251, Alternative Minimum Tax." You must then complete this form to see how much, if any, Alternative Minimum Tax (C) Copyright 1991, Bammel Software. All Rights Reserved. Share-TAX/1040 Page 16 you owe. Under certain conditions, line 18 of this form is needed for the Schedule R Worksheet and the Form 2441 Worksheet. If needed, and you have not filled it in, you will be so notified on the Exception Report. 7.18. Form 8606 - Non-deductible IRA Contributions This form will be automatically created and printed whenever nondeductible IRA contributions are calculated by the IRA Worksheet ("WI"). If you made contributions in 1992, you will need to fill in line 5 to indicate what part of your 1992 contributions, if any, you want to be nondeductible. IRA rollovers, if any, are also entered on this form. If you need to file this form separately (not attached to your tax return) so that you need to sign it, use an original form from the IRS. 7.19. Form 8615 - Under 14, Investmt Income over $1100 Be sure to keep the child's and parent's numbers straight. If this form is filled in, the tax on Form 1040, line 38 will be taken from it instead of being calculated in the normal manner. 7.20. Worksheet - W-2 Forms Wage Information Enter each individual W-2 on a separate screen using a different screen selector. The totals for all W-2s will be shown on screen W2T. These worksheets need not be submitted to the IRS since you should have Forms W-2 for each. Keep them for your records. If you leave the "Taxpayer/Spouse" entry blank, then that W-2 will be assumed to be for the "Taxpayer". 7.21. Worksheet - Schedule of Other Income Enter here all amounts for Form 1040, line 22. If there is just one line entered, and if the description is short enough to fit directly on Form 1040, then it will be printed on the 1040 and this schedule will not be printed. If it won't fit, then the total is printed on Form 1040, the description on Form 1040 is printed as "SEE ATTACHED SCHEDULE", and this schedule is printed on a separate page. This schedule should then be submitted to the IRS with the rest of the return. 7.22. Schedule EIC - Earned Income Credit If it appears that you might qualify for this credit, and you have not answered the questions necessary on it, the Exception Report will notify you that you might qualify. (C) Copyright 1991, Bammel Software. All Rights Reserved. Share-TAX/1040 Page 17 7.23. Worksheet - Taxable Part of Pensions/Annuities Data-entry is self-explanatory. 7.24. Worksheet - Taxable Social Security Benefits Data-entry is self-explanatory. 7.25. Worksheet - IRA Contributions This worksheet obscures a fairly simple thing. Everyone is entitled to contribute to his IRA the smaller of 1) his earned income, or 2) $2000; or with a non-working spouse the smaller of 1) earned income, or 2) $2250, but a maximum of $2000 per individual. The difference is in whether any or all of it is tax-deductible. Any non-deductible contributions must be reported on Form 8606. Just fill in the numbers on the first screen and everything else will be taken care of for you. If any of it is non-deductible, then you must complete Form 8606, and you will be warned by the Exception Report to do so if you haven't already. You will also need to fill in Form 8606 if you have any IRA rollovers. 7.26. Supplemental Schedules These schedules may be used to report detail which will not fit on the forms themselves. On the Form itself, enter "SEE SCHEDULE ATTACHED" and enter the total. Then on the supplemental schedule, enter the detail and in the title say what form it pertains to. NOTE: TOTALS FROM THESE SCHEDULES DO NOT AUTOMATICALLY GO ANYWHERE, and you must enter the totals where they belong. Submit these schedules to the IRS with your return. 7.27. Client Invoice This was designed for use by the paid tax preparer. 8. PRINTING 8.1. Printing Individual Forms You can print individual forms without printing the whole return by going to a screen pertaining to the form in question, and then pressing the F4 key. 8.2. IRS-Approved Form 1040 on LASER Printer This prints an exact duplicate of the Official Form 1040. To use this feature, select "HP LaserJet with 1040 forms software" from the Printer Setup screen (screen "PRSU"). You do not need a tax font cartridge, or any font cartridge, because the fonts are downloaded to the printer as needed during the printing. Since full font information is sent to the laser printer, printing may be somewhat slower than what (C) Copyright 1991, Bammel Software. All Rights Reserved. Share-TAX/1040 Page 18 you are used to. See "Precautions for printing to a file" below if you print to a file. 8.3. IRS-Approved Form 1040 on Dot Matrix Printer This prints a facsimile of Form 1040 on an IBM ProPrinter or compatible dot-matrix printer using the 216 x 240 dots/inch graphics mode. Except for the resolution of the printer, the printed form is an exact duplicate of the Official Form 1040. It has been approved by the IRS for submission in your tax return. Because the dots are so dense and overlap, you will probably get better results with an OLD ribbon. Expect it to take at least 30 minutes on an average-speed dot-matrix printer. If you get incorrect results, your printer may not be 100% compatible. If you get a printout which is too tall (about 11 inches high), then your printer is probably using the Epson LQ mode rather than the IBM ProPrinter mode. If you print to a file first, note that the file size is almost one megabyte, so be sure you have sufficient disk space before doing it. Also, see "Precautions for printing to a file" below. 8.4. Precautions for printing to a file Both the LASER and graphic dot-matrix versions of Form 1040 produce binary data. The DOS PRINT command will not correctly print such a file because it mis-interprets binary data as TABs, etc.. Instead, to print the file, you will need to execute the following DOS command: "COPY/B file-name PRN", or you will need a print spooler which will faithfully copy binary data to your printer. The "/B" selects binary mode and insures that the data is transferred unchanged to the printer. Networks may present other problems. However, the objective is always to get the data from Share-TAX/1040 to the printer with no alterations of any kind. 8.5. IRS Approval of Substitute Forms All substitute forms and schedules (computer generated forms used in place of the IRS official forms) printed by this program have been approved by the IRS. However, there are factors under your control which must meet requirements also, which are explained below. 8.6. IRS Requirements for Computer-Generated Forms Your printer must be set to 6 lines per inch vertically and 10 characters per inch horizontally. These are the normal (default) values for almost all printers. (C) Copyright 1991, Bammel Software. All Rights Reserved. Share-TAX/1040 Page 19 Form 1040 itself MUST be submitted using the IRS pre-printed form or a high-quality duplicate (offset press, photocopy, etc.) thereof. As stated earlier, the LASER 1040 and the dot-matrix graphic 1040 produced by this program are approved by the IRS for inclusion in your tax return. If you do not use either of these, you can order continuous pre-printed Forms 1040 from: Nelco Tax Forms P.O. Box 10208 Green Bay, WI 54307-0208 414-337-1000 Be sure to get the "1040 Official Edition" Tell them Bammel Software referred you. They accept telephone orders with credit cards as payment and will sell you as few as 100 sets. There are other sources of continuous forms, but note that many commercially available continuous Forms 1040 are not exact copies of the IRS Official Form 1040, but have had some of the data positions altered, and so are not suitable for use by Share-TAX/1040. You can also print your 1040 by simply placing single-sheet blank IRS 1040 forms in your computer printer. When printing the "IRS" 1040 form, the program will always pause for you to put the blank form in the printer. The tricky part is getting the 1040 form positioned correctly at the beginning of printing. If you have plenty of blank 1040's, just experiment with them until you get it right. Otherwise, one way of doing it is to print the 1040 on blank continuous paper. Then fasten the actual 1040 over the continuous paper in the proper position and re-run the paper through the printer without altering the top of form position. Another way to meet IRS requirements for Form 1040 is to use a copier and overlays which you can purchase or make yourself. To make your own, you will need to use a copier which does not significantly shrink or enlarge the copy. First make an "overlay" of a blank IRS Form 1040 on transparent plastic of the type designed for use in a copier. Then print the Form 1040 on blank paper, position the overlay correctly over the printout, and then make a copy of the combination. Overlays for Form 1040 can be purchased from Nelco Tax Forms mentioned above. Be sure to order the "1040 Official Edition". A "Proof" printout for the 1040 is provided which is similar to the substitute forms, but it is for your own use and review, and it SHOULD NOT BE SUBMITTED TO THE IRS. The forms and schedules other than Form 1040 may be fully computer generated with the following requirements: 1) A high standard of legibility is required. Low quality printers should not be used (good dot matrix is OK). The originals must be filed, NOT carbon copies. (C) Copyright 1991, Bammel Software. All Rights Reserved. Share-TAX/1040 Page 20 2) Paper must be at least 18 lb. weight, be 8" x 11" or 8.5" X 11" in size, and must have 1/4" to 1/2" margins on all sides after removal of pin-feed holes. 3) Paper color must be white or cream colored, and either it must be ruled every other line or be color-barred, or the computer printer must underline every other line. 4) Black ink must be used for printing. 5) Printing must be 6 lines per inch vertically, and 10 chars per inch horizontally. 6) Forms must be assembled with Form 1040 first, then the schedules and forms in their sequence number order (the sequence number is given after the "1991 *" at the top right), then supporting schedules in the order of the forms they refer to. When you select the "print all forms" option, they will automatically be printed in the correct order. 7) Social security numbers must be printed in the format: 000-00-0000, thus you must key them in in that form. 8.7. Calculation Before Printing Most forms require that the "CALC" function (complete calculations) be current. That is, no data should have been changed since the last "CALC" operation. The print program checks to be sure that this is so, and if so, it will print. If not, it warns you and will not print, until you have done a "CALC". 8.8. Printing to the Screen You can conveniently preview the printout by looking at it on the screen. Just select the "S" print option. 8.9. Printing to a File In addition to printing to the printer and to the screen, the program has two options for printing to files. The first option, overwrite "O", will erase any data that was in the file and overwrite it. This option will prompt you if the file already exists to be sure you want to over-write it. The other option, append "A", will add the data at the end of what is already in the file, if anything. This option will prompt you if the file does not already exist. 9. TAX PREPARER INFORMATION If you use this program as a paid tax-preparer, your name and address, etc. must be entered at the bottom of the back of the 1040. The Preparer Menu allows you to enter this information into the database, and then prints it. There is (C) Copyright 1991, Bammel Software. All Rights Reserved. Share-TAX/1040 Page 21 space on the database for 20 preparers, numbered 1 through 20. If you are using this program only for your own use, or for family members and friends where you receive no remuneration, you do not need to enter any preparer information. Select preparer number 0 when you setup your return. Then these fields will be left blank on the 1040 printout. 10. EXCEPTION REPORT MESSAGES "No room for 'Form 2106' description on Form 1040, line 30" This message occurs when you enter a description on Form 1040, line 30 and there is also a value from Form 2106 for the same line. In this case you will need to use a separate schedule to list all the necessary information and carry the total from it to Form 1040, line 30. "Excess FICA withheld by one employer, obtain refund from employer." If one employer withholds more than the maximum, you cannot obtain a refund for the excess on your tax return. You can only obtain a refund from the employer. This message will continue to display even though your tax return is correct. "Form 1040: May not exempt self on line 6a if line 33b checked" "Schedule A, line 14 is over $500, be sure to file Form 8283" "Schedule A contributions reduced by AGI limitation" "Must answer Sch B, part III since more than $400 interest/dividends" "You may owe a penalty, complete Form 2210 to find out." "On screen 2210D, must enter date final amount due to be paid" "On screen 2210D, date amount due paid before today (OK if you want that)" "You may need to file Form 6251, Alternative Minimum Tax." "Form 6251 Lines 4b, 4c & 4d set to zero since Sch A not applicable" This message occurs when you have filled out Form 6251 and Schedule A, and your schedule A deductions are less than the Standard Deduction. Therefore, the return is calculated as if you had not filled out Schedule A. The presence of this message does not necessarily indicate an error. "You need to complete Form 6251 for Form 2441 Worksheet." "You need to complete Form 6251 for Schedule R Worksheet." (C) Copyright 1991, Bammel Software. All Rights Reserved. Share-TAX/1040 Page 22 Even if you don't otherwise need Form 6251, you must fill it out for these worksheets and forms. "Filing status must be "Single" (1) for Form 8615" "Must enter PARENT's filing status on Form 8615" "You must complete Form 8606." This message occurs when your IRA worksheet results in non-deductible IRA contributions. Go to Form 8606 and fill it out for taxpayer and/or spouse as needed. "You may qualify for Earned Income Credit. Go to screen EIC." "Not joint return, but "S" (spouse) selected on screen W2" "Not joint return, but "S" (spouse) selected on Schedule C" "Not joint return, but "S" (spouse) selected on Schedule F" "Not joint return, but "S" (spouse) selected on Schedule SE" "Not joint return, but "S" (spouse) selected on Form 2106" "Not joint return, but "S" (spouse) selected on Form 4137" "Not joint return, but "S" (spouse) selected on Form 8606" One of these errors is likely to occur if you start entering your tax return as a joint return, but then later change it to an individual return. Normally, these errors must be corrected to get correct results. (C) Copyright 1991, Bammel Software. All Rights Reserved.