World of Shareware - Software Farm 2

home *** CD-ROM | disk | FTP | other *** search

/ World of Shareware - Software Farm 2 / wosw_2.zip / wosw_2 / BUDGET / TTOOL92.ZIP / CHAPT31.DOC < prev next >

Wrap

Text File | 1992-12-13 | 37.7 KB | 851 lines

Chapter 31. How to Figure Your Tax In 1992, there are three tax rates (15%, 28%, and 31%). The 31% rate applies to any taxable income you have over the following amount shown for your filing status. Married filing jointly $86,500 Qualifying widow(er) $86,500 Head of household $74,150 Single $51,900 Married filing separately $43,250 Maximum tax rate on capital gains. The new 31% tax rate for individuals does not apply to net capital gains. The maximum income tax rate on net capital gain income remains at 28%. Net capital gain is the excess of net long-term capital gain for the year over the net short-term capital loss for the year. Limit on exemption amount. If your adjusted gross income is more than a specified amount based on your filing status, the amount of your deduction for exemptions is reduced. These amounts are explained later in this chapter under Exemptions. Introduction This chapter discusses the steps you need to take to figure your tax on: ∙ Form 1040EZ, ∙ Form 1040A, and ∙ Form 1040. Also, the chapter will help you to determine if you should use the standard deduction or itemize your deductions. In addition, it covers a portion of the alternative minimum tax. The IRS will figure your tax for you if certain requirements are met. These requirements are discussed at the end of this chapter. Form 1040EZ If you file Form 1040EZ, you must figure your adjusted gross income and taxable income before you can find your tax. Adjusted gross income (line 3, Form 1040EZ). This is the total of your wages, salaries, tips, taxable scholarships or fellowship grants, and taxable interest income. Taxable income (line 5, Form 1040EZ). Your taxable income is your adjusted gross income (line 3), minus your standard deduction and the deduction for your personal exemption (line 4). The amount of these deductions depends on whether you can be claimed as a dependent on someone else's return, such as your parents. The rules for determining whether you are a dependent are in Chapter 3. If you are not a dependent, the total of your standard deduction and your personal exemption is $5,900. Check the No box and enter this amount on line 4. If you can be claimed as a dependent by another taxpayer, check the Yes box on line 4 and complete the worksheet on the back of Form 1040EZ. Enter the result from line E of the worksheet on line 4. You are not allowed a personal exemption. Tax withheld. After you have figured your taxable income, enter the total of your federal income tax withheld on line 6. This amount is shown in Box 9 of your Form(s) W─2. Form(s) W─2 must be attached to the return. Also include on line 6 any excess social security or railroad retirement tax withheld. You can use the worksheet in the instructions for Form 1040EZ to figure your excess social security taxes. Show this amount to the left of line 6 and write "Excess SST." See Chapter 36 for a discussion of excess withholding. Tax. To find your tax, use the Tax Table at the back of this publication or in the instructions for Form 1040EZ. Find the income line that includes your taxable income shown on line 5 of your Form 1040EZ. Next, find the column heading for single (if using Publication 17) and read down the column. The amount shown where the income line and filing status column (single) meet is your tax. Enter it on line 7. Refund or amount you owe. If line 6 is larger than line 7, subtract line 7 from line 6 and enter the result on line 8. This is the amount of your refund. For information on refunds, see Refunds in Chapter 1. If line 7 is larger than line 6, subtract line 6 from line 7 and enter the result on line 9. This is the amount you owe. For information on how to pay, see Amount You Owe in Chapter 1. Form 1040A If you file Form 1040A, you must find your adjusted gross income and your taxable income before you can figure your tax. Adjusted gross income (line 16, Form 1040A). This is your total income (line 14) minus your IRA deduction, and your spouse's IRA deduction if you file a joint return. You can figure your IRA deduction by completing the worksheet in the instructions for Form 1040A. Also see Chapter 18. Taxable income (line 22). This is your adjusted gross income (line 16) minus your standard deduction (line 19) and the deduction for your exemptions (line 21). Standard deduction. Your standard deduction is based on your filing status, whether you are 65 or older or blind, and whether you can be claimed as a dependent on another person's return. For information, see Standard Deduction, later, and Chapter 20. Exemptions. To figure the deduction for your exemptions, multiply $2,300 by the number of exemptions claimed on line 6e. If you can be claimed as a dependent on someone else's return, check the box on line 18b and do not claim an exemption for yourself on line 6a. Tax, credits, and payments. Next, you must figure your tax. Subtract from your tax any credits or payments to determine whether you owe additional tax or are due a refund. Note. If this is the return of a child under age 14 on January 1, 1993, with more than $1,200 of investment income, you cannot use the Tax Table. Instead, you must check the box marked "Form 8615" on line 23. Use Form 8615, Tax for Children Under Age 14 Who Have Investment Income of More Than $1,200, to compute your tax. This computation is explained in Chapter 32. Tax. To find your tax, use the Tax Table at the back of this publication or in the instructions for Form 1040A. In the Tax Table, find the income line that includes your taxable income shown on line 22. Next, find the column heading that describes your filing status and read down the column. The amount shown where the income line and filing status column meet is your tax. Enter it on line 23 and check the box marked "Tax Table." Credits. There are three credits that can be claimed on Form 1040A. Credits, unlike deductions, are subtracted after you find your tax from the tax table and, therefore, reduce your tax dollar for dollar. These credits are: 1) Credit for child and dependent care expenses, 2) Credit for the elderly or the disabled, and 3) Earned income credit. The earned income credit is explained later under Payments. If you claim the credit for child and dependent care expenses, you must complete all applicable parts of Schedule 2 (Form 1040A) and attach it to your return. For information on the credit for child and dependent care expenses, see Chapter 33. If you claim the credit for the elderly or the disabled, you must complete Schedule 3 (Form 1040A) and attach it to your return. For information on credit for the elderly or the disabled, see Chapter 34. Add lines 24a and 24b and enter the result on line 24c. Subtract your total credits (line 24c) from your tax (line 23) and enter the result on line 25. If you received advance earned income credit payments, the amount will be shown on your Form(s) W─2, Box 8. Enter the amount of these payments on line 26. For more information, see Advance Earned Income Credit Payments in Chapter 35. Payments. The next step is to figure your total payments. On line 28a, enter the total Federal income tax withheld from your pay. This amount is shown in Box 9 of your Form(s) W─2. If you have more than one employer, carefully add the amounts from these boxes and enter the total on line 28a. If you received a Form 1099 showing income tax withheld on dividends, interest, IRA distributions, or pensions, check the box on line 28a and include the amount withheld in the total on line 28a. It is important to check all of your Form 1099 statements to see whether any income tax was withheld. A table showing the proper boxes that record withholding is included later under Payments under Form 1040. On line 28b, enter your 1992 estimated tax payments and any overpayment applied from your 1991 Federal income tax return. On line 28c, enter your earned income credit. You may be able to take this credit if you earned less than $22,370 and a child who meets certain age and other requirements lived with you. Figure the amount of your earned income credit by completing Schedule EIC. For information on the earned income credit, see Chapter 35. On line 28d, include any excess social security or railroad retirement tax withheld. Write "Excess SST" and the amount in the space to the left of line 28d. See Chapter 36 for a discussion on this. Add the amounts on lines 28a, 28b, and 28c and enter this total on line 28d. This sum is your total payments. Refund or Amount You Owe After you have your total tax (line 27) and your total payments (line 28d), you can determine if you are due a tax refund or if you owe additional tax. Refund If line 28d is more than line 27, subtract line 27 from line 28d and enter the result on line 29. This is the amount of your refund. For information on refunds, see Refunds in Chapter 1. If you want the entire amount on line 29 refunded, enter that amount on line 30. Enter on line 30 the exact amount you want refunded. However, if you want all or part of your refund applied to your 1993 estimated tax, you must enter the appropriate amount on line 31. The amount on line 31 will be credited to your 1993 estimated taxes unless you request us to apply it to your spouse's account. This request should include your spouse's social security number. The amount on line 31 generally cannot be refunded to you until you file a tax return for 1993. Amount You Owe If line 27 is more than line 28d, subtract line 28d from line 27 and enter the result on line 32. This is the amount you owe. For information on how to pay, see Amount You Owe in Chapter 1. Form 1040 If you file Form 1040, you must compute your adjusted gross income and taxable income before you can figure your tax. Adjusted Gross Income Adjusted gross income (line 31, Form 1040) is your total income (line 23) minus any adjustments for the following: 1) IRA deduction for you (line 24a), and for your spouse (line 24b). See Chapter 18. 2) Deduction for one-half of your self-employment tax (line 25). See Publication 533, Self-Employment Tax. 3) Self-employed health insurance deduction (line 26). See Chapter 22. 4) Keogh retirement plan and self-employed SEP deduction (line 27). See Publication 560, Retirement Plans for the Self-Employed. 5) Penalty on early withdrawal of savings (line 28). See Chapter 8. 6) Alimony paid. You must show the recipient's social security number in the space provided on line 29. See Chapter 19. 7) Other adjustments. Write in the following adjustments in the space to the left of line 30 and include them in the total on line 30. a) Certain expenses of qualified performing artists. See Chapter 30. b) Jury duty pay given to your employer. See Chapter 13. c) Amortization of the costs of forestation or reforestation if you do not have to file Schedule C or Schedule F. See Publication 535, Business Expenses. d) Certain required repayments of supplemental unemployment benefits. See Chapter 6. Taxable Income There are two ways to figure the amount of your taxable income (line 37, Form 1040). You can itemize your deductions on Schedule A (Form 1040) or take the standard deduction. Itemizing Your Deductions You generally can choose to either itemize your deductions (such as medical expenses, taxes, mortgage interest, and casualty losses) on Schedule A (Form 1040) or take a standard deduction, whichever is greater. You may benefit from itemizing your deductions on Schedule A if you: 1) Do not qualify for the standard deduction, or the amount you can claim is limited, 2) Had large uninsured medical and dental expenses during the year, 3) Paid interest and taxes on your home, 4) Had large unreimbursed employee business expenses or other miscellaneous deductions, 5) Had large casualty or theft losses not covered by insurance, 6) Had large unreimbursed moving expenses, 7) Made large contributions to qualified charities, or 8) Have total itemized deductions that are more than the highest standard deduction amount to which you otherwise are entitled. Some taxpayers itemize deductions because they do not qualify for the standard deduction or the amount they qualify for is limited (see Chapter 20). If you decide to itemize your deductions, complete and attach Schedule A to your return. Enter the amount from line 26 of Schedule A on line 34 of Form 1040. If you and your spouse file separate returns, you can use the method that gives you the lowest total tax, even though one of you may pay more than the other. You both must use the same method of claiming deductions. If one itemizes deductions, the other should itemize also since he or she will not qualify for the standard deduction. Changing your mind. If you do not itemize your deductions and later find you should have itemized - or if you itemize and later find you should not have - you may change your return by filing Form 1040X, Amended U.S. Individual Income Tax Return. If you are married and filed separate returns, you may change methods of taking deductions only if you and your spouse make the same changes. Both of you must consent in writing to the assessment for any additional tax either one may owe as a result of the change. If you itemize your deductions, your taxable income (line 37) is your adjusted gross income (line 32) minus your itemized deductions (line 34) and your exemptions (line 36). Standard Deduction The standard deduction reduces the amount of your income that is taxed and thus reduces the amount of tax you will pay. The standard deduction is based on your filing status and whether you are 65 or older or blind. 65 or older or blind. If you are 65 or older or blind in 1992, you are entitled to a higher standard deduction than taxpayers under 65 and not blind. For information on who qualifies for the higher standard deduction for age and blindness, see Chapter 20. The standard deduction amounts are given in the standard deduction charts and worksheet in Chapter 20. Special rules. Your standard deduction is zero if: 1) Your spouse itemizes deductions on a separate return, 2) You are a dual-status or nonresident alien, or 3) You have a short tax year. If you can be claimed as a dependent on another person's return, your standard deduction may be limited. See Standard Deduction for Dependents in Chapter 20. Amount of the standard deduction. If you decide to take the standard deduction, show the amount on line 34 of Form 1040. The amount of the standard deduction for most people is shown on Form 1040 to the left of line 34. Others must use the standard deduction charts and worksheet in Chapter 20 or in the Form 1040 instructions to find their standard deduction. If you take the standard deduction, your taxable income (line 37) is your adjusted gross income (line 32) minus your standard deduction (line 34) and your exemptions (line 36). Exemptions Whether you itemize your deductions or use the standard deduction, you can generally deduct $2,300 for each exemption you can claim. However, if your adjusted gross income (AGI) is more than the dollar amount for your filing status as shown in the following table, the amount of your deduction is less. Filing Status AGI more than: Single ........................................ $105,250 Married filing jointly ........................ 157,900 Married filing separately ..................... 78,950 Head of household ............................. 131,550 Qualifying widow(er) .......................... 157,900 See Chapter 3 for an explanation of this reduction and a worksheet to figure the amount of your deduction. Tax, Credits, and Payments After finding your taxable income, the next step is to figure your tax liability. This tax amount is then reduced by any credits you may have. Finally, you apply any payments or other credits against your liability to determine whether you owe additional tax or are entitled to a refund. Tax Most people use the Tax Table to figure their tax. However, you must use the Tax Rate Schedules to figure your tax if your taxable income is $100,000 or more. If you have a net capital gain, your tax may be less if you figure it on Schedule D. Form 8615 may have to be used to figure the tax for a child with more than $1,200 of investment income. Tax Table. The Tax Table is shown in the back of this publication and in the instructions for Form 1040. To find your tax, read down the income column to the line that includes your taxable income as shown on line 37. Then read across the line to the column heading that describes your filing status. The amount shown where the income line and filing status column meet is your tax. Enter it on line 38 and check the box marked Tax Table. Tax Rate Schedules. If your taxable income (line 37) is $100,000 or more, you must figure your tax by using Tax Rate Schedules X, Y─1, Y─2, or Z unless you can use Schedule D or are required to use Form 8615. The Tax Rate Schedules are shown at the back of this publication and in the Form 1040 instructions. Enter your tax on line 38, and check the box marked Tax Rate Schedules. Maximum tax rate on capital gains (Schedule D). In 1992, the highest tax rate on taxable income is 31%. However, the highest tax rate on a net capital gain is 28%. A net capital gain is the excess of your net long-term capital gains over your net short-term capital losses. Therefore, the maximum 28% rate applies if you have a long-term capital gain shown on line 16, Schedule D (Form 1040), and a net gain shown on line 17, Schedule D (Form 1040). You should complete Part IV of Schedule D (Form 1040) to figure your tax only if your taxable income (line 37, Form 1040) is more than the amount shown for your filing status in the following table. Filing Status Amount Married filing jointly ........................ $86,500 Qualifying widow(er) .......................... 86,500 Head of household ............................. 74,150 Single ........................................ 51,900 Married filing separately ..................... 43,250 If you use Part IV of Schedule D, enter your tax from line 27, Schedule D, on line 38, Form 1040, and check the box marked Schedule D. Investment income of certain minor children (Form 8615). If a child under age 14 at the end of the year has more than $1,200 of interest, dividends, and other investment income, part of that income may be taxed at the parent's rate. The tax is figured using Form 8615, Tax for Children Under Age 14 Who Have Investment Income of More Than $1,200. Form 8615 should not be filed if neither parent is alive at the end of the year or if a parent chooses to include the child's interest and dividend income on his or her return. For more information, see Chapter 32. Additional taxes. If you owe either of the taxes shown on line 39 (Form 1040), attach Form 4970, Tax on Accumulation Distribution of Trusts, or Form 4972, Tax on Lump-Sum Distributions. On line 39, check the box that applies to you and enter the amount of additional taxes. Credits After you have figured your tax and entered the total of lines 38 and 39 on line 40, figure your credits and enter them on lines 41 through 45. Enter the total credits on line 45. Subtract line 45 from line 40. Enter the result on line 46. Credit for child and dependent care expenses. Enter on line 41 (Form 1040) the amount of this credit, which you figure on Form 2441, Child and Dependent Care Expenses. See Chapter 33 for information on this credit. Credit for the elderly or the disabled. Enter on line 42 (Form 1040) the amount of this credit, which you figure on Schedule R. See Chapter 34 for more information. Foreign tax credit. Enter on line 43 (Form 1040) the amount of foreign tax credit, which you figure on Form 1116. Foreign tax credit is discussed in Publication 514, Foreign Tax Credit for Individuals. Other credits. Enter other credits on line 44 and check the appropriate box to identify which form you are attaching. General business credit. The general business credit is made up of 7 separate business-related credits. If you have 2 or more of the separate credits, use Form 3800, General Business Credit, and check Box a on line 44. If you have only one of these credits, check Box d and enter the number of the appropriate form. See Form 3800 for more information. Mortgage interest credit. Use Form 8396, Mortgage Interest Credit, to figure the amount of this credit and check Box b. See Mortgage interest credit under Interest in Publication 530, Tax Information for Homeowners. Credit for prior year minimum tax. Complete Form 8801, Credit For Prior Year Minimum Tax - Individuals and Fiduciaries, if you paid alternative minimum tax in 1991 on deferred preference items or have a carryforward of the minimum tax credit. Attach this form to your tax return and check Box c on line 44. For information on this credit, see Publication 909, Alternative Minimum Tax for Individuals. Credit for fuel from a nonconventional source. Include the credit in the total for line 45. Write the amount and "FNS" on the dotted line next to line 45. Also attach a separate schedule showing how you figured the credit. See Internal Revenue Code section 29, for further information. Total tax. Add lines 46 through 52. Put the total on line 53. Line 53 is your total tax. Other Taxes If you owe any other taxes or if you received advance earned income payments, complete any of lines 47 through 52 that apply to you and enter the total on line 53. Self-employment tax. If you (or your spouse if you file a joint return) have net earnings of $400 or more from self-employment, complete Schedule SE (Form 1040) and show any tax you owe on line 47 (Form 1040). See Publication 533, Self-Employment Tax, for more information. Alternative minimum tax. Use Form 6251 to see if you owe any alternative minimum tax. Enter the result on line 48 (Form 1040). This tax is discussed later in this chapter and in Publication 909. Recapture taxes. If you are required to recapture investment tax credit on Form 4255, low-income housing credit on Form 8611, or Federal mortgage subsidy on Form 8828, enter the amount on line 49 (Form 1040) and check the appropriate box. Social security and Medicare tax on tip income not reported to employer. Attach Form 4137, Social Security and Medicare Tax on Unreported Tip Income, and show on line 50 (Form 1040) the tax due on tip income you did not report to your employer. See Chapter 7 for more information. Tax on an IRA or other qualified retirement plan. You may owe additional taxes on your IRA or other qualified retirement plan if you: Made excess contributions to your IRA, Received early distributions, Did not receive a minimum required distribution, or Received excess distributions. You must complete Form 5329, Return for Additional Taxes Attributable to Qualified Retirement Plans (Including IRAs), Annuities, and Modified Endowment Contracts, and attach it to your return. Enter the tax on line 51 (Form 1040). See Chapter 18 for more information. Advance earned income credit. Include on line 52 any advance earned income credit payments you received in 1992. Your W─2 form(s) will show these payments in Box 8. Section 72(m)(5) excess benefits. If you are or were a 5% owner of a business and you received a distribution of excess benefits from a qualified pension or annuity plan, you may have to pay a penalty tax of 10% of the excess benefits distribution. Include the amount of the penalty in your total for line 53. Also write the amount and "Section 72(m)(5)" on the dotted line next to line 53. See Publication 560, Retirement Plans for the Self-Employed, for more information. Uncollected employee social security and Medicare or RRTA tax on tips (or group-term life insurance). If you did not have enough wages to cover the social security tax and Medicare tax or railroad retirement (RRTA) tax due on tips you reported to your employer (or on group-term life insurance), include the amount in the total for line 53. The amount of tax due will be shown on your Form W─2. Also write the amount and "Uncollected Tax" on the dotted line next to line 53. See Chapter 7 for more information. Golden parachute payments. If you received an excess parachute payment (EPP), you must pay a tax equal to 20% of this excess payment. Include the amount of this tax in your total for line 53. Also write the amount and "EPP" on the dotted line next to line 53. See Form 1040 Instructions for Line 53 for more information. Payments Once you have figured your total tax on line 53, figure your total payments. On line 54, enter your federal income tax withheld. This includes amounts from Forms W─2, W─2G, 1099─R, and any other Form 1099. It is important to check all of your statements to see whether any tax was withheld and to carefully add the amounts before making an entry on line 54. The following table shows the proper boxes that record withholding. FORM NUMBER LOCATION W-2 ........................................ Box 9 W-2G ....................................... Box 2 1099-B ..................................... Box 4 1099-DIV ................................... Box 2 1099-G ..................................... Box 4 1099-INT ................................... Box 4 1099-MISC .................................. Box 4 1099-OID ................................... Box 4 1099-PATR .................................. Box 4 1099-R ..................................... Box 4 If you made estimated tax payments for 1992, enter the total of these payments on line 55. Also enter on line 55 any overpayment from your 1991 return that you applied to your 1992 estimated tax. Enter your earned income credit on line 56. You may be able to take this credit if you earned less than $22,370 and a child who meets certain age and other requirements lived with you. Figure the amount of your earned income credit on Schedule EIC. The earned income credit is explained in Chapter 35. If you paid any tax with Forms 4868, 2688, or 2350 (extensions of time to file), enter this amount on line 57. If you worked for more than one employer and had too much social security tax, Medicare tax, or railroad retirement tax withheld, enter the excess amount on line 58. This is explained in Chapter 36. If you can take a credit for tax on gasoline, diesel fuel, and other fuels used in your business, or for certain diesel-powered cars, vans, and light trucks, attach Form 4136. Include the amount of the credit on line 59 and check Box b. If you can take a regulated investment company credit, attach Copy B of Form 2439, Notice to Shareholder of Undistributed Long-Term Capital Gains. Include the amount of the credit on line 59 and check Box a. Add lines 54 through 59 and enter this total on line 60. This sum is your total payments. Refund or Amount You Owe After you have your total tax (line 53) and your total payments (line 60), you must determine if you are due a tax refund or if you owe additional tax. Refund If the amount on line 60 is more than the amount on line 53, subtract line 53 from line 60 and enter the result on line 61. This is the amount of tax you have overpaid. If you want the entire amount refunded to you, enter the amount from line 61 on line 62. If you want all of your overpayment applied to your 1993 estimated tax, enter the amount on line 63. If you want part of your overpayment applied to your 1993 estimated tax, you must complete both lines 62 and 63. For information on refunds, see Refunds in Chapter 1. Amount You Owe If the amount on line 53 is more than the amount on line 60, subtract line 60 from line 53 and enter the result on line 64. This is the amount you owe. For information on how to pay, see Amount You Owe in Chapter 1. Alternative Minimum Tax The tax laws give special treatment to some kinds of income and allow special deductions and credits for some kinds of expenses. Taxpayers who benefit from these laws have to pay at least a minimum amount of tax through an additional tax. This additional tax is called the alternative minimum tax (AMT). You may have to pay the alternative minimum tax if your taxable income for regular tax purposes, combined with any of the adjustments and preference items that apply to you, is more than: $40,000 if your filing status is married filing a joint return (or a qualifying widow(er) with dependent child), $30,000 if your filing status is single or head of household, or $20,000 if your filing status is married filing a separate return. Adjustments to taxable income include: ∙ Addition of personal exemptions, ∙ Addition of the standard deduction (if claimed), ∙ Addition of itemized deductions claimed for state and local taxes, certain interest, most miscellaneous deductions, and part of medical expenses, ∙ Subtraction of any refund of state and local taxes included in gross income, ∙ Change in amount of depreciation claimed on certain property, ∙ Change in method of determining income from long-term contracts entered into on or after March 1, 1986, ∙ Change in method of determining income from certain installment sales, and ∙ Change in method of determining passive activity loss deduction. Tax preference items include: ∙ That part of any deduction for depletion that is more than the adjusted basis of the property, ∙ Part of any deduction for intangible drilling costs if the deduction (minus the amount that could have been deducted if the cost were amortized over 120 months) is more than 65% of the net income from oil, gas, and geothermal properties, ∙ Tax-exempt interest on certain private activity bonds, ∙ Unrealized appreciation on donations of certain long-term capital gain property donated after June 30, 1992, and ∙ Accelerated depreciation on certain property placed in service before 1987. For more information about the alternative minimum tax and how to figure it, see Publication 909, Alternative Minimum Tax for Individuals, and Form 6251, Alternative Minimum Tax - Individuals. Tax Figured by IRS The IRS will figure your tax on Form 1040EZ, Form 1040A, or Form 1040. If the IRS figures your tax and you paid too much, you will receive a refund. If you did not pay enough, you will receive a bill for the balance. You may avoid interest or the penalty for late payment if you pay the bill within 30 days of the date of the bill or by the due date for your return, whichever is later. Note. If you did not pay enough tax, you may be charged a penalty for underpayment of estimated tax. See Underpayment Penalty in Chapter 5. Changing your mind. If you choose to have the IRS figure your tax, you may later change your mind by filing an amended return. Form 1040EZ If you file Form 1040EZ by April 15, 1993, you may choose to have the IRS figure your tax. Put your name and address label on your return. If you do not have a label, print (do not type) your name, address, and social security number in the spaces provided. What to complete. Read lines 1 through 6 and fill in the lines that apply to you. Sign and date your return. Attach Copy B or the first copy of your Form W─2 to your return. Mail the return to the Internal Revenue Service Center for the area where you live. Form 1040A If you file Form 1040A by April 15, 1993, you may choose to have the IRS figure your tax. Place your name and address label on your return or, if you do not have a label, fill in (print or type) your name, address, and social security number. If you are married, give the social security numbers of both spouses even if you file separately. If you are required to use Form 8615, Tax for Children Under Age 14 Who Have Investment Income of More Than $1,200, or if you want any of your refund applied to your 1993 estimated tax, IRS cannot figure your tax for you. What to complete. Read lines 1 through 22 and fill in the lines that apply to you. If you file a joint return, use the space to the left of line 22 to separately show your own and your spouse's taxable income. Credit for child and dependent care expenses. If you can take this credit, complete Schedule 2 and attach it to your return. You must show on Schedule 2 the name, address, and identifying number of the person or organization who provided the care. Enter the amount of the credit on line 24a (Form 1040A). Credit for the elderly or the disabled. If you can take this credit, attach Schedule 3 to your return and write "CFE" in the space to the left of line 24b (Form 1040A). Check the box on Schedule 3 for your filing status and age, and fill in lines 11 and 13 of Part III if applicable. Also complete Part II if applicable. Advance earned income credit payment. If you received any advance earned income credit payment during 1992, enter the amount on line 26. Your Form(s) W─2 will show these payments in Box 8. Payments. Place any income tax withheld that is shown in Box 9 of Form W─2, or the appropriate box of Form 1099, on line 28a. Place any estimated tax payments you made on line 28b. Earned income credit. If you can take the earned income credit, as discussed in Chapter 35, the IRS will figure the credit for you. Write "EIC" in the space to the left of line 28c. Fill in Parts II and III of Schedule EIC and attach it to your Form 1040A. Form W─2. Attach Copy B or the first copy of your Form W─2 to your return. Also attach any Form 1099─R you received that has withholding tax in Box 4. Filing the return. Sign and date your return. Also fill in your occupation. If you are filing a joint return, both you and your spouse must sign it. Show both of your occupations on a joint return. Mail the return to the Internal Revenue Service Center for the area where you live. Form 1040 If you file Form 1040 by April 15, 1993, you may choose to have the IRS figure your tax if you meet all of the conditions described below: 1) All of your income for 1992 was from wages, salaries, tips, interest, dividends, taxable social security benefits, unemployment compensation, IRA distributions, pensions, or annuities, 2) Your taxable income on line 37 is not more than $50,000, 3) You do not itemize deductions, 4) You do not file any of the following forms: a) Schedule D, Capital Gains and Losses. b) Form 2555, Foreign Earned Income. c) Form 4137, Social Security and Medicare Tax on Unreported Tip Income. d) Form 4970, Tax on Accumulation Distribution of Trusts. e) Form 4972, Tax on Lump-Sum Distributions. f) Form 6198, At-Risk Limitations. g) Form 6251, Alternative Minimum Tax - individuals. h) Form 8615, Tax for Children Under Age 14 Who Have Investment Income of More Than $1,200. i) Form 8814, Parent's Election To Report Child's Interest and Dividends. 5) You do not want any of your refund applied to your 1993 estimated tax. Name, address, and social security number. Put your name and address label on your return. If you do not have a label, fill in (print or type) your name, address, and social security number. If you are married, give the social security numbers of both spouses even if you file separately. What to complete. Read lines 1 through 37 and fill in the lines that apply to you. If you are filing a joint return, use the space under the words Adjustments to Income on the front of your return to show your taxable income and your spouse's taxable income separately. Read lines 39 through 59. Fill in the lines that apply to you, but do not fill in the Total lines. Please be sure to fill in line 54 for Federal income tax withheld. Fill in any forms or schedules asked for on the lines you completed, and attach them to your return when you file it. Credit for the elderly or the disabled. If you can take the credit for the elderly or the disabled, as discussed in Chapter 34, attach Schedule R. Write "CFE" on the dotted line next to line 42 of Form 1040. On Schedule R, check the box for your filing status and age, and fill in lines 11 and 13 of Part III if applicable. Also complete Part II of Schedule R if applicable. Earned income credit. If you can take the earned income credit, as discussed in Chapter 35, fill in Parts II and III of Schedule EIC and attach it to your return. Write "EIC" on the dotted line next to line 56 of Form 1040. Payments. Place any income tax withheld that is shown in Box 9 of Form W─2, or the appropriate box of Form 1099, on line 54. Attach Copy B or the first copy of your Form(s) W─2 to your return. Also attach any Form 1099─R you received that has withholding tax in Box 4. Place any estimated tax payments you made on line 55. Filing the return. Be sure to sign and date your return and show your occupation. If you are filing a joint return, both you and your spouse must sign it. Mail your return to the Internal Revenue Service Center for the area where you live.